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OFFER DOCUMENT DATED 3 JULY 2013 (registered by the Singapore Exchange Securities Trading Limited acting as agent on behalf of the Monetary Authority of Singapore on 3 July 2013)

®

PS Group Holdings Ltd.
(Company Registration No.: 201311530Z) (Incorporated in the Republic of Singapore on 30 April 2013)

Placement of 20,400,000 Placement Shares at S$0.25 each, payable in full on application.

STRENGTHENING LINKS IN EMERGING MARKETS
THIS DOCUMENT IS IMPORTANT. IF YOU ARE IN ANY DOUBT AS TO THE ACTION YOU SHOULD TAKE, YOU SHOULD CONSULT YOUR LEGAL, FINANCIAL, TAX OR OTHER PROFESSIONAL ADVISER(S). United Overseas Bank Limited (the “Sponsor”) has made an application to the Singapore Exchange Securities Trading Limited (the “SGX-ST”) for permission to deal in, and for quotation of, all the ordinary shares (the “Shares”) in the capital of PS Group Holdings Ltd. (the “Company”) already issued, the new shares (the “Placement Shares”) which are the subject of the Placement (as defined herein), the new Shares which may be issued under the PS Group Holdings Performance Share Plan (the “Performance Shares”) and the new Shares which may be issued upon the exercise of the options which may be granted under the PS Group Holdings Employee Share Option Scheme (the “Option Shares”) on Catalist (as defined herein). Acceptance of applications will be conditional upon, inter alia, issue of the Placement Shares and the listing and quotation of all our existing issued Shares, the Placement Shares, the Performance Shares and the Option Shares. Monies paid in respect of any application accepted will be returned if the admission and listing do not proceed. The dealing in and quotation of the Shares will be in Singapore dollars. Companies listed on Catalist may carry higher investment risk when compared with larger or more established companies listed on the Main Board of the SGX-ST. In particular, companies may list on Catalist without a track record of profitability and there is no assurance that there will be a liquid market in the shares or units of shares traded on Catalist. You should be aware of the risks of investing in such companies and should make the decision to invest only after careful consideration and, if appropriate, consultation with your professional adviser(s). This offer of Placement Shares is made in or accompanied by this Offer Document that has been registered by the SGX-ST acting as agent on behalf of the Monetary Authority of Singapore (the “Authority”). Neither the Authority nor the SGX-ST has examined or approved the contents of this Offer Document. Neither the Authority nor the SGX-ST assumes any responsibility for the contents of this Offer Document, including the correctness of any of the statements or opinions made or reports contained in this Offer Document. The SGX-ST does not normally review the application for admission but relies on the Sponsor confirming that our Company is suitable to be listed and complies with the Listing Manual (as defined herein). Neither the Authority nor the SGX-ST has in any way considered the merits of the Shares being offered for investment. The registration of this Offer Document by the SGX-ST does not imply that the Securities and Futures Act (as defined herein), or any other legal or regulatory requirements, or requirements under the SGX-ST’s listing rules, have been complied with. We have not lodged this Offer Document in any other jurisdiction. Investing in our Shares involves risks. Potential investors in our Company are advised to read the section entitled “Risk Factors” of this Offer Document and the rest of this Offer Document carefully and to seek professional advice if in doubt. After the expiration of six months from the date of registration of this Offer Document, no person shall make an offer of our Shares, or allot, issue or sell any of our Shares, on the basis of this Offer Document; and no officer or equivalent person or promoter of our Company will authorise or permit the offer of any of our Shares or the allotment, issue or sale of any of our Shares, on the basis of this Offer Document.

Sponsor and Placement Agent

The Mix-And-Match Expert

CORPORATE PROFILE
With an operating history dating back to 1994, PS Group Holdings Ltd. is a “Mix-And-Match Expert” for the supply of quality fasteners. We offer an extensive product range in excess of 15,000 different types and sizes of fasteners that have diverse industrial applications in, amongst others, infrastructure developments, structural fabrication and construction in civil works, transportation and manufacturing of heavy machinery, automotives and parts. In the late 1990s, we launched an internet website with information of our range of products that allowed customers to place their orders with us online. This enabled us to have a more extensive reach and to expand our export operations beyond Southeast Asia. In 2011, we put in place an online IT infrastructure which enabled us to have a faster turnaround time in processing our customers’ orders. Our quality management system was ISO 9002:94 certified in 1998 and the certification was updated to ISO 9002 in 2001 and subsequently to ISO 9001 (2000 Revision) in 2003 and ISO 9001:2008 in 2011. In 2012, we were awarded the “Top 100 Singapore Excellence Award 2011/2012” and the “Singapore Brands Award 2012/2013”.

Diversified customer base of approximately 200 customers in more than 45 countries

Competitive Strengths
Diverse range of products to satisfy customer requirements • Extensive product range in excess of 15,000 different types and sizes of fasteners such as screws, bolts, nuts, pins, anchors, rivets, washers and clips. • Able to supply our products at any quantity for shipment to anywhere in the world at relatively short notice. • Carry a ready inventory and have ready access to our suppliers to replenish inventory. Established relationships with our suppliers • Strong relationships with suppliers such as Fang Sheng, Tong Hwei, AFS and Shanghai Prime who supply well established brands such as YFS, THE, RECOIL and SFC. • Assurance of continuity of supplies enables us to develop our customer network, respond promptly to our customers’ requirements and expand our geographical coverage with greater confidence. Established relationships with our customers • Diversified customer base comprising approximately 200 customers in more than 45 countries. • Repeat customers form a significant proportion of our customers for each of the past three financial years ended 31 December 2012. Scalable business model which is not dependent on any single enduse industry • We believe that our online IT infrastructure has helped to improve our operational efficiency and enabled us to reach out online to existing and potential customers. • Our online IT infrastructure has also enabled us to automate certain areas of our operations such as order processing and inventory management, thereby translating into a higher level of service and shorter lead times in response to our customers’ requests. • We believe that our extensive product range, which can cater to a broad spectrum of industrial applications, coupled with our diversified base of customers across countries, means that we are not dependent on any single end-use industry, which in turn, enables us to ride through the different business and economic cycles of different industries and different countries. Experienced and committed management team • Our Executive Chairman, Teo Choon Hock and Managing Director, Kwek Keng Seng have more than 30 years of experience each in the fastener industry.

Online IT Infrastructure to improve Operational Efficiency

EARLY ADOPTION OF IT
Launched our website in the late 1990s to allow online orders

AUTOMATE CERTAIN AREAS OF OUR OPERATIONS SCALABLE BUSINESS MODEL
IT infrastructure as our backbone allows us to drive expansion plans Translates to higher level of service and shorter lead times in response to customers’ requests

Prospects and Trends
• We expect that increasing fixed investments and a rise in the manufacturing bases in emerging economies such as Asia Pacific, South America, Middle East and Africa will boost fastener demand compared to the more developed markets. • We have focused our marketing efforts on distributors with retail networks primarily in Southeast Asia, as well as in emerging markets such as South America. • We believe that, given the wide spectrum of commercial and industrial applications of fasteners, the fastener industry is not dependent on any single end-use industry, but is generally dependent on factors such as population growth, industrial development and general economic conditions. • Subject to competitive and pricing pressures, we expect our revenue to generally follow the activity trend for the manufacture of durable goods, as well as in the construction and infrastructure industry.






REACH OUT TO CUSTOMERS ONLINE
Convenience of placing orders from anywhere, at anytime, of any mix and for any quantity

Business Strategies and Future Plans
Enhance existing warehouse facilities and upgrade inventory management system • Reorganise warehouse space and install new racks in line with our expansion plans. • Install a new inventory management system or upgrade our existing system so as to enhance our ability to more efficiently track and manage an increased inventory and achieve a faster turnaround in processing our customers’ orders. Diversify our product range • Expand our product range based on our understanding of market trends and customers’ product demands and requirements through our longstanding relationships with our customers and frequent contact with them. Expand our business through acquisitions, joint ventures and/or strategic alliances • We believe that suitable acquisitions, joint ventures and strategic alliances will give us access to new markets, customers and businesses.

Revenue
$’m 14 12 10 8 6 4 2 0 FY2010 FY2011 FY2012

12.0

12.5

12.3

FY2012 Revenue Breakdown by Geography
Other countries2

8.8%
Indonesia Emerging Markets1

24.9%

23.2%
Malaysia Singapore

Proposed Dividends
Our Directors intend to recommend at least 30.0% of our net profit attributable to Shareholders in FY2013 and FY2014 as dividends.
1

17.9%

25.2%

2

Emerging markets mainly comprise Sri Lanka, Panama, United Arab Emirates, Chile, Argentina, Thailand, Pakistan, and Venezuela. Other countries mainly comprise New Zealand, Australia, Japan, Israel and Canada.

Financial Highlights
(Financial Year ended 31 December)

Gross Profit and Margin
S’m 5 3.8 3.7 4 4.0 % 40

S$’000 Revenue Gross profit Profit before taxation Net Profit

FY2010 11,991 3,783 1,912 1,669

FY2011 12,502 3,680 1,479 1,304

FY2012 12,293 3,975 1,330 1,092

31.5%
3 2 1 0 FY2010

32.3% 29.4%

35

30

25

20 FY2011 FY2012

TABLE OF CONTENTS
Page CORPORATE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . GLOSSARY OF TECHNICAL TERMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS . . . . . . . . . . . . . . . . . . . SELLING RESTRICTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . DETAILS OF THE PLACEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . LISTING ON CATALIST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . INDICATIVE TIMETABLE FOR LISTING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . PLAN OF DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . OFFER DOCUMENT SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . THE PLACEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RISKS RELATING TO OUR BUSINESS AND INDUSTRY . . . . . . . . . . . . . . . . . . . . . . . . RISKS RELATING TO OWNERSHIP OF OUR SHARES . . . . . . . . . . . . . . . . . . . . . . . . . PLACEMENT STATISTICS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . USE OF PROCEEDS AND LISTING EXPENSES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CAPITALISATION AND INDEBTEDNESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . DIVIDEND POLICY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SHARE CAPITAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . DILUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RESTRUCTURING EXERCISE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . GROUP STRUCTURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SELECTED COMBINED FINANCIAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . GENERAL INFORMATION ON OUR GROUP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . HISTORY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 6 12 13 15 16 16 21 22 24 28 29 29 36 39 41 43 47 48 51 52 53 54 55

57 72 72

1

TABLE OF CONTENTS
BUSINESS OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . INVENTORY MANAGEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SALES AND MARKETING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . QUALITY ASSURANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . AWARDS AND CERTIFICATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MAJOR CUSTOMERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MAJOR SUPPLIERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . DISTRIBUTION AGREEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CREDIT MANAGEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . INSURANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . PROPERTIES AND FIXED ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . INTELLECTUAL PROPERTY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RESEARCH AND DEVELOPMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CORPORATE SOCIAL RESPONSIBILITY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . GOVERNMENT REGULATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . LICENCES AND PERMITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . COMPETITION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . COMPETITIVE STRENGTHS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . PROSPECTS AND TRENDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ORDER BOOK. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . BUSINESS STRATEGIES AND FUTURE PLANS . . . . . . . . . . . . . . . . . . . . . . . . . . . . WHERE YOU CAN FIND US . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . DIRECTORS, MANAGEMENT AND STAFF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MANAGEMENT REPORTING STRUCTURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . EXPERIENCE AND TRAINING OF OUR DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . EXECUTIVE OFFICERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . DIRECTORS’ AND EXECUTIVE OFFICERS’ REMUNERATION . . . . . . . . . . . . . . . . . EMPLOYEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SERVICE AGREEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . INTERESTED PERSON TRANSACTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . PAST INTERESTED PERSON TRANSACTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . PRESENT AND ON-GOING INTERESTED PERSON TRANSACTIONS. . . . . . . . . . . 73 75 76 76 77 77 78 78 79 80 80 81 81 82 82 85 87 88 89 90 90 91 92 92 92 94 95 97 98 98 101 101 102

2

TABLE OF CONTENTS
GUIDELINES AND REVIEW PROCEDURES FOR FUTURE INTERESTED PERSON TRANSACTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . POTENTIAL CONFLICTS OF INTERESTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CORPORATE GOVERNANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . EMPLOYEE SHARE SCHEMES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . PS GROUP HOLDINGS PERFORMANCE SHARE PLAN . . . . . . . . . . . . . . . . . . . . . . . . PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME . . . . . . . . . . . . . . . . . . EXCHANGE CONTROLS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CLEARANCE AND SETTLEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . GENERAL AND STATUTORY INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 . . . . . . . . DESCRIPTION OF ORDINARY SHARES . . . . . . . . . . . . . . . . . . . SUMMARY OF SELECTED ARTICLES OF ASSOCIATION OF OUR COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . TAXATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RULES OF THE PS GROUP HOLDINGS PERFORMANCE SHARE PLAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . TERMS, CONDITIONS AND PROCEDURES FOR APPLICATION AND ACCEPTANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

103 105 106 110 110 118 127 128 129

A-1 B-1

APPENDIX B APPENDIX C

– –

C-1 D-1

APPENDIX D APPENDIX E

– –

E-1

APPENDIX F



F-1

APPENDIX G



G-1

3

CORPORATE INFORMATION
BOARD OF DIRECTORS : Teo Choon Hock (Executive Chairman) Kwek Keng Seng (Managing Director) Ang Miah Khiang (Lead Independent Director) Tan Jee Ming (Independent Director) Tan Chin Keong (Independent Director)

COMPANY SECRETARY

:

Lee Bee Fong (ACIS)

REGISTERED OFFICE

:

3 Kaki Bukit Road 2 #01-06 Eunos Warehouse Complex Singapore 417837

SHARE REGISTRAR AND SHARE TRANSFER OFFICE

:

Tricor Barbinder Share Registration Services (a division of Tricor Singapore Pte. Ltd.) 80 Robinson Road #02-00 Singapore 068898

SPONSOR AND PLACEMENT AGENT

:

United Overseas Bank Limited 80 Raffles Place UOB Plaza Singapore 048624

INDEPENDENT AUDITORS AND REPORTING ACCOUNTANTS

:

Ernst & Young LLP Public Accountants and Chartered Accountants One Raffles Quay North Tower, Level 18 Singapore 048583 Partner-in-charge: Adrian Koh Hian Yan (a practising member of the Institute of Singapore Chartered Accountants)

SOLICITORS TO THE PLACEMENT

:

Drew & Napier LLC 10 Collyer Quay #10-01 Ocean Financial Centre Singapore 049315

SOLICITORS TO THE SPONSOR AND PLACEMENT AGENT

:

RHTLaw Taylor Wessing LLP Six Battery Road #10-01 Singapore 049909

4

CORPORATE INFORMATION
PRINCIPAL BANKERS : DBS Bank Ltd. 12 Marina Boulevard Marina Bay Financial Centre Tower 3 Singapore 018982 Malayan Banking Berhad 200 Jalan Sultan #01-02 Textile Centre Singapore 199018 Standard Chartered Bank 6 Battery Road Singapore 049909 United Overseas Bank Limited 80 Raffles Place UOB Plaza Singapore 048624

RECEIVING BANKER

:

United Overseas Bank Limited 80 Raffles Place UOB Plaza Singapore 048624

5

DEFINITIONS
In this Offer Document and the accompanying Application Forms, the following definitions apply where the context so admits: Group Companies “Company” : PS Group Holdings Ltd. and the terms “we”, “our”, “our Company” or “us” have correlative meanings Our Company and our subsidiary, following the completion of the Restructuring Exercise Our subsidiary, PS Fasteners Pte. Ltd.

“Group”

:

“PS Fasteners”

:

Other Corporations and Agencies “AFS” “Authority” “CDP” “CPF” “Fang Sheng” “Independent Auditors and Reporting Accountants” “IRAS” “MOM” “NTUC” “Pan Sun” : : : : : : Alcoa Fastening Systems-Australia Pty Ltd The Monetary Authority of Singapore The Central Depository (Pte) Limited The Central Provident Fund Fang Sheng Screw Co., Ltd. Ernst & Young LLP

: : : :

Inland Revenue Authority of Singapore Ministry of Manpower of Singapore National Trades Union Congress Pan Sun Hardware Company, a partnership established in Singapore in 1982 that was converted into a private limited company named Pan Sun Hardware Pte. Ltd. in 1992, further details of which are disclosed in the section entitled “ General Information on Our Group – History ” of this Offer Document PSA Corporation Limited Securities Clearing and Computer Services (Pte) Limited Singapore Exchange Securities Trading Limited Shanghai Prime Machinery Co., Ltd. Tricor Barbinder Share Registration Services (a division of Tricor Singapore Pte. Ltd.)

“PSA” “SCCS” “SGX-ST” “Shanghai Prime” “Share Registrar”

: : : : :

6

DEFINITIONS
“Sponsor” or “Placement Agent” or “Receiving Bank” or “UOB” “Tong Hwei” General “Application Forms” : The printed application forms to be used for the purpose of the Placement and which form part of this Offer Document The list of applications for subscription of the Placement Shares The articles of association of our Company : United Overseas Bank Limited

:

Tong Hwei Enterprise Co., Ltd.

“Application List”

:

“Articles” or “Articles of Association” “Associate”

:

:

(a)

in relation to any director, chief executive officer, substantial shareholder or controlling shareholder (being an individual) means: (i) (ii) his immediate family; the trustees of any trust of which he or his immediate family is a beneficiary or, in the case of a discretionary trust, is a discretionary object; or

(iii) any company in which he and his immediate family together (directly or indirectly) have an interest of 30.0% or more; (b) in relation to a substantial shareholder or a controlling shareholder (being a company) means any other company which is its subsidiary or holding company or is a subsidiary of such holding company or one in the equity of which it and/or such other company or companies taken together (directly or indirectly) have an interest of 30.0% or more

“Associated Company”

:

In relation to a corporation, means: (a) any corporation in which the corporation or its subsidiary has, or the corporation and its subsidiary together have, a direct interest of not less than 20.0% but not more than 50.0% of the aggregate of the nominal amount of all the voting shares; or any corporation, other than a subsidiary of the corporation or a corporation which is an associated company by virtue of paragraph (a), the policies of which the corporation or its subsidiary, or the corporation together with its subsidiary, is able to control or influence materially

(b)

7

DEFINITIONS
“Audit Committee” : The audit committee of our Company as at the date of this Offer Document, unless otherwise stated An award of Shares granted under the PSP The board of Directors of our Company as at the date of this Offer Document, unless otherwise stated The sponsor-supervised listing platform of the SGX-ST Chief Executive Officer The Companies Act (Chapter 50) of Singapore, as amended, modified or supplemented from time to time A person who: (a) holds directly or indirectly 15% or more of the nominal amount of all voting shares in a company, where SGX-ST may determine that a person is not a controlling shareholder; or in fact exercises control over a company

“Award” “Board” or “Board of Directors” “Catalist” “CEO” “Companies Act”

: :

: : :

“Controlling Shareholder”

:

(b) “Directors” :

The directors of our Company as at the date of this Offer Document, unless otherwise stated Includes a corporation, an unincorporated association, a partnership and the government of any state, but does not include a trust Earnings per Share The PS Group Holdings Employee Share Option Scheme, adopted by our Company on 13 June 2013, the terms of which are set out in Appendix F of this Offer Document The executive directors of our Company as at the date of this Offer Document, unless otherwise stated The executive officers of our Group as at the date of this Offer Document, unless otherwise stated Financial year ended or, as the case may be, ending 31 December Goods and Services Tax The independent directors of our Company as at the date of this Offer Document, unless otherwise stated Information technology

“entity”

:

“EPS” “ESOS”

: :

“Executive Directors”

:

“Executive Officers”

:

“FY” or “Financial Year”

:

“GST” “Independent Directors”

: :

“IT”

:

8

DEFINITIONS
“Latest Practicable Date” : 7 June 2013 being the latest practicable date prior to the date of lodgement of this Offer Document with the SGX-ST, acting as agent on behalf of the Authority Section B of the listing manual of the SGX-ST, as amended, modified or supplemented from time to time The management and sponsorship agreement dated 3 July 2013 entered into between our Company and UOB pursuant to which UOB agreed to manage and sponsor the Placement, details as described in the section entitled “ General and Statutory Information – Management and Placement Arrangements ” of this Offer Document A day on which the SGX-ST is open for trading in securities Not meaningful Net asset value The nominating committee of our Company as at the date of this Offer Document, unless otherwise stated The non-executive directors of our Company (including Independent Directors) as at the date of this Offer Document, unless otherwise stated Net tangible assets This offer document dated 3 July 2013 issued by our Company in respect of the Placement The list of issuers maintained by the SGX-ST in relation to the Catalist The option(s) which may be granted pursuant to the ESOS The new Shares which may be allotted and issued upon the exercise of the Options Price earnings ratio The new Shares which may be issued from time to time pursuant to the vesting of Awards granted under the PSP The period which comprises FY2010, FY2011 and FY2012 The placement of the Placement Shares by the Placement Agent on behalf of our Company for subscription at the Placement Price, subject to and on the terms and conditions of this Offer Document

“Listing Manual”

:

“Management Agreement”

:

“Market Day” “n.m.” “NAV” “Nominating Committee”

: : : :

“Non-Executive Directors”

:

“NTA” “Offer Document”

: :

“Official List”

:

“Option(s)” “Option Shares”

: :

“PER” “Performance Shares”

: :

“period under review” “Placement”

: :

9

DEFINITIONS
“Placement Agreement” : The placement agreement dated 3 July 2013 entered into between our Company and UOB pursuant to which UOB agreed to subscribe and/or procure subscribers for the Placement Shares, details as described in the section entitled “ General and Statutory Information – Management and Placement Arrangements ” of this Offer Document S$0.25 for each Placement Share The 20,400,000 new Shares which are the subject of the Placement The PS Group Holdings Performance Share Plan, adopted by our Company on 13 June 2013, the terms of which are set out in Appendix E of this Offer Document The remuneration committee of our Company as at the date of this Offer Document, unless otherwise stated The corporate restructuring exercise undertaken in connection with the Placement as described in the section entitled “ Restructuring Exercise ” of this Offer Document The securities account maintained by a depositor with CDP but does not include a securities sub-account The service agreements entered into between our Company and our Executive Directors, namely Teo Choon Hock and Kwek Keng Seng, as set out in the section entitled “ Directors, Management and Staff – Service Agreements ” of this Offer Document The Securities and Futures Act (Chapter 289) of Singapore, as amended or modified from time to time The corporate announcement system maintained by the SGX-ST for the submission of announcements by listed companies Ordinary share(s) in the capital of our Company The subdivision of 6,803,523 Shares into 47,600,000 Shares following the Restructuring Exercise Registered holder(s) of Share(s), except where the registered holder is CDP, the term “Shareholders” shall, in relation to such Shares mean the Depositors whose Securities Accounts are credited with Shares The Republic of Singapore

“Placement Price” “Placement Shares”

: :

“PSP”

:

“Remuneration Committee”

:

“Restructuring Exercise”

:

“Securities Account”

:

“Service Agreements”

:

“SFA” or “Securities and Futures Act” “SGXNET”

:

:

“Share(s)” “Share Split”

: :

“Shareholder(s)”

:

“Singapore”

:

10

DEFINITIONS
“Substantial Shareholder(s)” : Person(s) who has or have an interest in the Share(s), the nominal amount of which is not less than 5% of the aggregate of the nominal amount of all the voting shares of our Company

Currencies, Units and Others “S$” or “$” and “cents” “%” “m” “sq m” “US$” : : : : : Singapore dollars and cents respectively Per centum Metre Square metre United States dollars

The expressions “Depositor”, “Depository Agent” and “Depository Register” shall have the meanings ascribed to them respectively in Section 130A of the Companies Act. 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 and vice versa . References to persons shall include corporations. Any reference in this Offer Document and the Application Forms to any statute or enactment is a reference to that statute or enactment as for the time being amended or re-enacted. Any word defined under the Companies Act, the SFA or any statutory modification thereof and used in this Offer Document and the Application Forms shall, where applicable, have the meaning assigned to it under the Companies Act, the SFA or any statutory modification thereof, as the case may be. Any reference in this Offer Document and the Application Forms to Shares being allotted to an applicant includes allotment to CDP for the account of that Applicant. Any reference to a time of day in this Offer Document and the Application Forms shall be a reference to Singapore time unless otherwise stated. References in this Offer Document to “the Group”, “we”, “our”, and “us” or any other grammatical variations thereof shall unless otherwise stated, mean our Company, our Group or any member of our Group as the context requires. Any discrepancies in the tables included herein between the listed amounts and the totals thereof are due to rounding. Accordingly, figures shown as totals in certain tables may not be an arithmetic aggregation of the figures that precede them.

11

GLOSSARY OF TECHNICAL TERMS
To facilitate a better understanding of our Group, the following glossary provides an explanation on some of the technical terms and abbreviations relating to our Group’s industry. The terms and their assigned meanings may not correspond to standard industry usage or common meanings, as the case may be, of these terms: “ANSI” : The American National Standards Institute Standards. ANSI means the voluntary national consensus standards for products, services, processes, systems, and personnel in the United States and in various sectors, the creation, promulgation and accreditation of which are overseen by the American National Standards Institute. The British Standards. BS means the formal consensus standards promulgated, accredited and certified by the British Standard Institution on a wide range of products, services and processes across various sectors; from nuts and bolts to sustainability, risk, business continuity management and nanotechnology. The Deutsches Institut für Normung (the German Institute for Standardisation) Standards. DIN is developed by the German Institute for Standardisation to promote rationalisation, quality assurance, safety, and environmental protection in various technological and non-technical sectors. The International Organization for Standardisation Standards. ISO standards provide requirements, specifications, guidelines or characteristics that can be used consistently to ensure that materials, products, processes and services are fit for their purposes. The Japanese Industrial Standards. JIS specifies the standards used for industrial activities in Japan published by the Japanese Industrial Standards Association for the improvement of technology and enhancement of production efficiency.

“BS”

:

“DIN”

:

“ISO”

:

“JIS”

:

12

CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS
All statements contained in this Offer Document, statements made in press releases and oral statements that may be made by us or our Directors, Executive Officers or employees acting on our behalf, that are not statements of historical fact, constitute “forward-looking statements”. You can identify some of these forward-looking statements by terms such as “expects”, “believes”, “plans”, “intends”, “estimates”, “anticipates”, “may”, “will”, “would” and “could” or similar words. However, you should note that these words are not the exclusive means of identifying forward-looking statements. All statements regarding our expected financial position, trend information, business strategies, plans and prospects are forward-looking statements. These forward-looking statements, including without limitation, statements as to: (a) (b) (c) (d) (e) our revenue and profitability; expected growth in demand; expected industry trends and development; anticipated expansion plans; and other matters discussed in this Offer Document regarding matters that are not historical facts,

are only predictions. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expected, expressed or implied by these forward-looking statements. These risks, uncertainties and other factors include, among others: (a) changes in political, social and economic conditions and the regulatory environment in Singapore and other countries in which we conduct business or expect to conduct business; changes in currency exchange rates or interest rates; our inability to implement our business strategies and future plans; our inability to realise our anticipated growth strategies and expected internal growth; changes in the availability and prices of raw materials and goods which we use or require to operate our business; changes in customer preferences; changes in competitive conditions and our ability to compete under such conditions; changes in our future capital needs and the availability of financing and capital to fund such needs; other factors beyond our control; and the factors described in the section entitled “ Risk Factors ” of this Offer Document.

(b) (c) (d) (e)

(f) (g) (h)

(i) (j)

13

CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS
Some of these factors are discussed in more detail in this Offer Document, in particular, the discussions under the sections entitled “ Risk Factors ”, “ Management’s Discussion and Analysis of Financial Position and Results of Operations ” and “ General Information on Our Group – Prospects and Trends ” of this Offer Document. These forward-looking statements are applicable only as at the date of this Offer Document. Given the risks and uncertainties that may cause our actual future results, performance or achievements to be materially different from that expected, expressed or implied by the forward-looking statements in this Offer Document, undue reliance must not be placed on these statements which apply only as at the date of this Offer Document. Neither our Company, the Sponsor, the Placement Agent nor any other person represents or warrants that our Group’s actual future results, performance or achievements will be as discussed in those statements. All forward-looking statements by or attributable to us, or persons acting on our behalf, contained in this Offer Document are expressly qualified in their entirety by such factors. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of the risks faced by us. We, the Sponsor and the Placement Agent disclaim any responsibility to update any of those forward-looking statements or publicly announce any revisions to those forwardlooking statements to reflect future developments, events or circumstances for any reason, even if new information becomes available or other events occur in the future. We are, however, subject to the provisions of the SFA and the Listing Manual regarding corporate disclosure. In particular, pursuant to Section 241 of the SFA, if after the registration of the Offer Document but before the close of the Placement, our Company becomes aware of (a) a false or misleading statement or matter in the Offer Document; (b) an omission from the Offer Document of any information that should have been included in it under Section 243 of the SFA; or (c) a new circumstance that has arisen since the Offer Document was lodged which would have been required by Section 243 of the SFA to be included in the Offer Document if it had arisen before the Offer Document was lodged with the SGX-ST acting as agent on behalf of the Authority and that is materially adverse from the point of view of an investor, our Company may, in consultation with the Sponsor and the Placement Agent, lodge a supplementary or replacement offer document with the SGX-ST acting as agent on behalf of the Authority.

14

SELLING RESTRICTIONS
Singapore This Offer Document does not constitute an offer, solicitation or invitation to subscribe for the Placement Shares in any jurisdiction in which such offer, solicitation or invitation is unlawful or is not authorised or to any person to whom it is unlawful to make such offer, solicitation or invitation. No action has been or will be taken under the requirements of the legislation or regulations of, or of the legal or regulatory requirements of any jurisdiction, except for the filing and/or lodgement of this Offer Document in Singapore in order to permit a public offering of the Placement Shares and the public distribution of this Offer Document in Singapore. The distribution of this Offer Document and the offering of the Placement Shares in certain jurisdictions may be restricted by the relevant laws in such jurisdictions. Persons who may come into possession of this Offer Document are required by our Company, the Sponsor and the Placement Agent to inform themselves about, and to observe and comply with, any such restrictions at their own expense and without liability to our Company, the Sponsor and the Placement Agent. Persons to whom a copy of this Offer Document has been issued shall not circulate to any other person, reproduce or otherwise distribute this Offer Document or any information herein for any purpose whatsoever nor permit or cause the same to occur.

15

DETAILS OF THE PLACEMENT
LISTING ON CATALIST The Sponsor has, on our behalf, made an application to the SGX-ST for permission to deal in, and for quotation of, all our Shares already issued, the Placement Shares, the Performance Shares and the Option Shares. Such permission will be granted when our Company has been admitted to Catalist. Our acceptance of applications for the Placement Shares will be conditional upon, inter alia, issue of the Placement Shares and the listing and quotation of all our existing issued Shares, the Placement Shares, the Performance Shares and the Option Shares. Monies paid in respect of any application accepted will be returned to you at your own risk, without interest or any share of revenue or other benefit arising therefrom, and you will not have any claim whatsoever against us, the Sponsor or the Placement Agent if the admission and listing do not proceed. After the expiration of six months from the date of registration of this Offer Document, no person shall make an offer of our Shares, or allot, issue or sell any of our Shares, on the basis of this Offer Document; and no officer or equivalent person or promoter of our Company will authorise or permit the offer of any of our Shares or the allotment, issue or sale of any of our Shares, on the basis of this Offer Document. Companies listed on Catalist may carry higher investment risk when compared with larger or more established companies listed on the Main Board of the SGX-ST. In particular, companies may list on Catalist without a track record of profitability and there is no assurance that there will be a liquid market in the shares or units of shares traded on Catalist. You should be aware of the risks of investing in such companies and should make the decision to invest only after careful consideration and, if appropriate, consultation with your professional adviser(s). The SGX-ST assumes no responsibility for the correctness of any of the statements or opinions made or reports contained in this Offer Document. Admission to Catalist is not to be taken as an indication of the merits of the Placement, our Company, our subsidiary, our existing issued Shares, the Placement Shares, the Performance Shares or the Option Shares. A copy of this Offer Document has been lodged with and registered by the SGX-ST acting as agent on behalf of the Authority. The Authority and the SGX-ST assume no responsibility for the contents of this Offer Document. The registration of this Offer Document by the SGX-ST acting as agent on behalf of the Authority does not imply that the SFA, or any other legal or regulatory requirements, have been complied with. The Authority and the SGX-ST have not, in any way, considered the merits of our existing issued Shares, the Placement Shares, the Performance Shares or the Option Shares, as the case may be, being offered or in respect of which an offer is made for investment. We have not lodged or registered this Offer Document in any other jurisdiction. We are subject to the provisions of the SFA and the Listing Manual regarding corporate disclosure. In particular, if after the registration of this Offer Document but before the close of the Placement, we become aware of: (a) (b) a false or misleading statement or matter in the Offer Document; an omission from the Offer Document of any information that should have been included in it under Section 243 of the SFA; or a new circumstance that has arisen since the Offer Document was lodged with the SGX-ST acting as agent on behalf of the Authority which would have been required by Section 243 of the SFA to be included in the Offer Document if it had arisen before this Offer Document was lodged,

(c)

16

DETAILS OF THE PLACEMENT
that is materially adverse from the point of view of an investor, we may lodge a supplementary or replacement offer document with the SGX-ST acting as agent on behalf of the Authority pursuant to Section 241 of the SFA. In the event that a supplementary or replacement offer document is lodged with the SGX-ST acting as agent on behalf of the Authority, the Placement shall be kept open for at least 14 days after the lodgement of such supplementary or replacement offer document. Where prior to the lodgement of the supplementary or replacement offer document, applications have been made under this Offer Document to subscribe for the Placement Shares and: (a) where the Placement Shares have not been issued to the applicants, we shall either: (i) within two days (excluding any Saturday, Sunday or public holiday) from the date of lodgement of the supplementary or replacement offer document, give the applicants notice in writing of how to obtain, or arrange to receive, a copy of the supplementary or replacement offer document, as the case may be, and provide the applicants with an option to withdraw their applications, and take all reasonable steps to make available within a reasonable period the supplementary or replacement offer document, as the case may be, to the applicants who have indicated that they wish to obtain, or who have arranged to receive, a copy of the supplementary or replacement offer document; or within seven days from the date of lodgement of the supplementary or replacement offer document, give the applicants a copy of the supplementary or replacement offer document, as the case may be, and provide the applicants with an option to withdraw their applications; or

(ii)

(iii) treat the applications as withdrawn and cancelled, in which case the applications shall be deemed to have been withdrawn and cancelled, and we shall, within seven days from the date of lodgement of the supplementary or replacement offer document, pay to the applicants all monies which they have paid on account of their applications for the Placement Shares without interest or any share of revenue or other benefit arising therefrom at the applicants’ own risk, and the applicants shall not have any claim whatsoever against our Company, the Sponsor or the Placement Agent; or (b) where the Placement Shares have been issued to the applicants but trading has not commenced, we shall either: (i) within two days (excluding any Saturday, Sunday or public holiday) from the date of lodgement of the supplementary or replacement offer document, give the applicants notice in writing of how to obtain, or arrange to receive, a copy of the supplementary or replacement offer document, as the case may be, and provide the applicants with an option to return to us the Placement Shares which they do not wish to retain title in, and take all reasonable steps to make available within a reasonable period the supplementary or replacement offer document, as the case may be, to the applicants who have indicated that they wish to obtain, or who have arranged to receive, a copy of the supplementary or replacement offer document; or within seven days from the date of lodgement of the supplementary or replacement offer document, give the applicants a copy of the supplementary or replacement offer document, as the case may be, and provide the applicants with an option to return to us the Placement Shares which they do not wish to retain title in; or

(ii)

17

DETAILS OF THE PLACEMENT
(iii) treat the issue of the Placement Shares as void, in which case the issue shall be deemed void and we shall, within seven days from the date of lodgement of the supplementary or replacement offer document, pay to the applicants all monies which they have paid on account of their applications for the Placement Shares without interest or any share of revenue or other benefit arising therefrom at the applicants’ own risk, and the applicants shall not have any claim whatsoever against our Company, the Sponsor or the Placement Agent. An applicant who wishes to exercise his option under paragraph (a)(i) or (ii) above to withdraw his application shall, within 14 days from the date of lodgement of the supplementary or replacement offer document, notify us of this, whereupon we shall, within seven days from the receipt of such notification, pay to him all monies paid by him on account of his application for the Placement Shares, without interest or any share of revenue or other benefit arising therefrom, at his own risk and he shall not have any claim whatsoever against our Company, the Sponsor or the Placement Agent. An applicant who wishes to exercise his option under paragraph (b)(i) or (ii) above to return the Placement Shares issued to him shall, within 14 days from the date of lodgement of the supplementary or replacement offer document, notify us of this and return all documents, if any, purporting to be evidence of title to those Placement Shares to us, whereupon we shall, within seven days from the receipt of such notification and documents, if any, pay to him all monies which he had paid on account of his application for the Placement Shares, without interest or any share of revenue or other benefit arising therefrom at his own risk, and the issue of those Placement Shares shall be deemed to be void and he shall not have any claim against our Company, the Sponsor or the Placement Agent. Where the Authority, the SGX-ST (acting as agent on behalf of the Authority) or other competent authority issues a stop order under the SFA (“ Stop Order ”) which directs that no or no further shares to which this Offer Document relates be allotted, and: (a) in the case where the Placement Shares have not been issued to the applicants, the applications of the Placement Shares pursuant to the Placement shall be deemed to have been withdrawn and cancelled and our Company shall, within 14 days from the date of the Stop Order, pay to the applicants all monies the applicants have paid on account of their applications for the Placement Shares; or in the case where the Placement Shares have been issued to the applicants, the issue of the Placement Shares pursuant to the Placement shall be deemed to be void and our Company shall, within 14 days from the date of the Stop Order, pay to the applicants all monies paid by them for the Placement Shares.

(b)

Such monies paid in respect of your application will be returned to you at your own risk, without interest or any share of revenue or other benefit arising therefrom, and you will not have any claim whatsoever against us, the Sponsor or the Placement Agent. This shall not apply where only an interim Stop Order has been served. This Offer Document has been read and approved by our Directors and they collectively and individually accept full responsibility for the accuracy of the information given in this Offer Document and confirm after making all reasonable enquiries, that to the best of their knowledge and belief, this Offer Document constitutes full and true disclosure of all material facts about the Placement, our Company and our subsidiary, and our Directors are not aware of any facts the omission of which would make any statement in this Offer Document misleading. Where 18

DETAILS OF THE PLACEMENT
information in this Offer Document has been extracted from published or otherwise publicly available sources or obtained from a named source, the sole responsibility of our Directors has been to ensure that such information has been accurately and correctly extracted from those sources and/or reproduced in this Offer Document in its proper form and context. Neither our Company, the Sponsor, the Placement Agent, nor any other parties involved in the Placement is making any representation to any person regarding the legality of an investment by such person under any investment or other laws or regulations. No information in this Offer Document should be considered as being business, legal or tax advice regarding an investment in our Shares. Each prospective investor should consult his own legal, financial, tax or other professional adviser for advice regarding an investment in any of our Shares. No person has been or is authorised to give any information or to make any representation not contained in this Offer Document in connection with the Placement and, if given or made, such information or representation must not be relied upon as having been authorised by us, the Sponsor or the Placement Agent. Neither the delivery of this Offer Document and the Application Forms nor any documents relating to the Placement, nor the Placement shall, under any circumstances, constitute a continuing representation or create any suggestion or implication that there has been no change in our affairs or in the statements of fact or information contained in this Offer Document since the date of this Offer Document. Where such changes occur and are material or required to be disclosed by law, the SGX-ST and/or any other regulatory or supervisory body or agency, we will comply with the requirements of the SFA and/or any other requirements of the SGX-ST and/or the Authority and make an announcement of the same to the SGX-ST and, if required under the SFA, lodge a supplementary or replacement offer document with the SGX-ST acting as agent on behalf of the Authority and will make the same available to the public after lodgement. All applicants should take note of any such announcement, or supplementary or replacement offer document and, upon the release of such an announcement, or supplementary or replacement offer document, shall be deemed to have notice of such changes. Save as expressly stated in this Offer Document, nothing herein is, or may be relied upon as, a promise or representation as to our future performance or policies. This Offer Document has been prepared solely for the purpose of the Placement and may not be relied upon by any persons other than the applicants in connection with their application for the Placement Shares or for any other purpose. The Placement Shares are offered for subscription solely on the basis of the information contained and representations made in this Offer Document. This Offer Document does not constitute an offer, solicitation or invitation of the Placement Shares in any jurisdiction in which such offer, solicitation or invitation is unlawful or unauthorised nor does it constitute an offer, solicitation or invitation to any person to whom it is unlawful to make such offer, solicitation or invitation. Copies of this Offer Document and the Application Forms may be obtained on request, subject to availability during office hours, from: United Overseas Bank Limited 80 Raffles Place #03-03 UOB Plaza 1 Singapore 048624 A copy of this Offer Document is also available on the SGX-ST website at http://www.sgx.com.

19

DETAILS OF THE PLACEMENT
The Application List will open immediately upon the registration of the Offer Document by the SGX-ST acting as agent on behalf of the Authority and will remain open until 12.00 noon on 9 July 2013 or for such further period or periods as our Directors may, in consultation with the Sponsor and the Placement Agent, in their absolute discretion decide, subject to any limitation under all applicable laws and regulations. In the event a supplementary offer document or replacement offer document is lodged with the SGX-ST acting as agent on behalf of the Authority, the Application List will remain open for at least 14 days after the lodgement of the supplementary or replacement offer document. Details of the procedures for application of the Placement Shares are set out in Appendix G of this Offer Document.

20

INDICATIVE TIMETABLE FOR LISTING
An indicative timetable is set out below for the reference of applicants: Indicative date/time 9 July 2013 at 12.00 noon 11 July 2013 at 9.00 a.m. 16 July 2013 Event Close of Application List Commence trading on a “ready” basis Settlement date for all trades done on a “ready” basis

The above timetable is only indicative as it assumes that the date of closing of the Application List is 9 July 2013, the date of admission of our Company to Catalist is 11 July 2013, the SGX-ST’s shareholding spread requirement will be complied with and the Placement Shares will be issued and fully paid-up prior to 11 July 2013. The above timetable and procedures may be subject to such modification as the SGX-ST may, in its absolute discretion, decide, including the decision to permit commencement of trading on a “ready” basis and the commencement date of such trading. In the event of any changes in the closure of the Application List or the time period during which the Placement is open, we will publicly announce the same: (a) through an SGXNET announcement to be posted on the internet at the SGX-ST website at http://www.sgx.com; and in a local English newspaper(s).

(b)

We will publicly announce the level of subscription for the Placement Shares as soon as it is practicable after the close of the Application List through the channels described in (a) and (b) above. Investors should consult the SGX-ST’s announcement of the “ready” trading date on the internet (at the SGX-ST website at http://www.sgx.com), or the newspapers or check with their brokers on the date on which trading on a “ready” basis will commence.

21

PLAN OF DISTRIBUTION
The Placement The Placement is for 20,400,000 Placement Shares offered in Singapore by way of placement and managed by UOB. Prior to the Placement, there has been no public market for our Shares. The Placement Price is determined by our Company in consultation with the Sponsor and the Placement Agent, taking into consideration, inter alia , the prevailing market conditions and estimated market demand for our Shares determined through a book-building process. The Placement Price is the same for each Placement Share and is payable in full on application. Pursuant to the Management Agreement, we have appointed UOB and UOB has agreed to manage and sponsor the Placement. Placement Shares Application for the Placement Shares may only be made by way of the Application Forms or such other forms of application as the Sponsor and Placement Agent deem appropriate. The terms, conditions and procedures for application and acceptance are set out in Appendix G of this Offer Document entitled “ Terms, Conditions and Procedures for Application and Acceptance ”. Pursuant to the Placement Agreement, UOB has agreed to subscribe and/or procure subscribers for the Placement Shares for a placement commission and brokerage of 3.0% of the Placement Price for each Placement Share, payable by our Company. The Placement Agent may, at its absolute discretion, appoint one or more sub-placement agents for the Placement Shares. Subscribers of the Placement Shares may be required to pay a brokerage of up to 1.0% of the Placement Price (and the prevailing GST thereon, if applicable) to the Placement Agent or any sub-placement agent that may be appointed by the Placement Agent. The Placement Agreement is conditional upon the Management Agreement not having been terminated or rescinded pursuant to the provisions of the Management Agreement. Subscription for Placement Shares As at the date of this Offer Document, our Independent Director, Tan Jee Ming, has indicated that he intends to subscribe for 20,000 Placement Shares, representing approximately 0.1% of the Placement Shares. Save as disclosed, to the best of our knowledge and belief, none of our Directors, Substantial Shareholders or their Associates intend to subscribe for the Placement Shares in the Placement. If such person(s) were to make an application for Shares and are subsequently allotted such number of Shares, we will make the necessary announcement(s) at an appropriate time. To the best of our knowledge and belief, none of our Independent Directors, members of our management or employees intends to subscribe for 5% or more of the Placement Shares in the Placement. As at the date of this Offer Document, Tsai Chao Chin, the general manager and shareholder of one of our major suppliers, Fang Sheng Screw Co., Ltd., and Ng Cheng Hong, the chairman and shareholder of one of our major customers, Advance Bolt & Fasteners Sdn Bhd, have indicated an interest to subscribe for 3,400,000 and 3,000,000 Placement Shares, representing approximately 22

PLAN OF DISTRIBUTION
16.7% and 14.7% of the Placement Shares respectively. In the event Tsai Chao Chin is allotted such number of Placement Shares, he will own 5.0% of our post-Placement share capital, and will therefore become a Substantial Shareholder of our Company. Save as disclosed, to the best of our knowledge and belief, as at the date of this Offer Document, we are not aware of any person who intends to subscribe for 5% or more of the Placement Shares. However, in assessing the market demand for our Shares, there may be other persons who may indicate an interest to subscribe for Placement Shares amounting to 5% or more of the Placement Shares. If such person(s) were to make an application for Placement Shares amounting to 5% or more of the Placement Shares and are subsequently allotted such number of Shares, we will make the necessary announcement(s) at an appropriate time. The final allotment of Shares will be made in accordance with the shareholding spread and distribution guidelines as set out in the Listing Manual. No Shares shall be allotted, issued or sold on the basis of this Offer Document later than six months after the date of registration of this Offer Document.

23

OFFER DOCUMENT SUMMARY
The information contained in this summary is derived from, and should be read in conjunction with, the full text of this Offer Document. Because it is a summary, it does not contain all of the information that prospective investors should consider before investing in our Shares. Prospective investors should read the entire Offer Document carefully, especially the section entitled “ Risk Factors ” of this Offer Document and our financial statements and related notes before deciding on whether to invest in our Shares. The meaning of terms not defined in this summary can be found elsewhere in this Offer Document. Under no circumstances should any information in this Offer Document summary be regarded as a representation or warranty by our Company, the Sponsor and/or the Placement Agent that such information will not change. OVERVIEW OF OUR GROUP

OUR BUSINESS We are a “Mix-And-Match Expert” for the supply of quality fasteners that provide our customers with the online convenience of placing their orders from anywhere, at anytime, of any mix and for any quantity for delivery on a timely basis. We are dedicated to meeting our customers’ requests and carry as at the Latest Practicable Date, in excess of 15,000 different types and sizes of fasteners including screws, bolts, nuts, pins, anchors, rivets, washers and clips in a variety of materials such as stainless steel, alloy steel, carbon steel, mild steel, brass, nylon and aluminium as well as a variety of platings that we can pack and arrange for shipment to anywhere in the world at relatively short notice. Our products have diverse industrial applications in amongst others, infrastructure developments, structural fabrication and construction in civil works, transportation and manufacturing of heavy machinery, automotives and parts which we supply as at the Latest Practicable Date, to approximately 200 customers in more than 45 countries. Please refer to the section entitled “ General Information on Our Group – Business Overview ” of this Offer Document for further details.

OUR FINANCIAL RESULTS AND FINANCIAL POSITION Our financial performance for FY2010, FY2011 and FY2012 and our financial position as at 31 December 2012 are summarised below. Please refer to the section entitled “ Management’s Discussion and Analysis of Financial Position and Results of Operations ” of this Offer Document and the “ Audited Combined Financial Statements Of PS Group Holdings Ltd. And Its Subsidiary For The Financial Years Ended 31 December 2010, 2011 And 2012 ” as set out in Appendix A of this Offer Document for further details. Selected items from the Combined Statements of Comprehensive Income of our Group < FY2010 S$’000 Revenue Gross profit Profit before taxation Profit for the year 11,991 3,783 1,912 1,669 Audited FY2011 S$’000 12,502 3,680 1,479 1,304 > FY2012 S$’000 12,293 3,975 1,330 1,092

24

OFFER DOCUMENT SUMMARY
Selected items from the Combined Balance Sheet of our Group Audited as at 31 December 2012 S$’000 Non-current assets Current assets Current liabilities Net current assets Non-current liabilities Total equity 3,170 10,071 5,918 4,153 519 6,804

OUR COMPETITIVE STRENGTHS We believe that we have the following competitive strengths: Diverse range of products to satisfy customer requirements We offer an extensive product range in excess of 15,000 different types and sizes of fasteners that have diverse industrial applications and are able to supply them at any quantity for shipment to anywhere in the world at relatively short notice. We carry a ready inventory and have ready access to our suppliers to replenish our inventory. We are therefore able to satisfy our customers’ requirements for any mix, any quantity and anywhere across a broad spectrum of industries for delivery on a timely basis. Established relationships with our suppliers We have over the years established strong relationships with our suppliers. This has provided us with assurance of the continuity of our supplies including those of well established brands in the fastener industry such as YFS, THE, RECOIL and SFC, thereby enabling us to develop our customer network, respond promptly to our customers’ requirements and expand our geographical coverage with greater confidence. Please refer to the sub-sections of “ General Information on Our Group ” entitled “ History ”, “ Major Suppliers ” and “ Distribution Agreements ” for more details of our strong relationships with our suppliers. Established relationships with our customers We are committed to supplying quality products and are dedicated to meeting our customers’ orders promptly. Over the years, we have established long-term relationships and have developed goodwill with many of our customers. Our Directors believe that we have established a track record and reputation as a reliable supplier of fasteners. For each of the last three financial years ended 31 December 2012, a significant proportion of our customers comprised repeat customers. We believe that this incidence of repeat orders from our existing customers is a testimony of their support to us and the quality of our service to them.

25

OFFER DOCUMENT SUMMARY
Scalable business model which is not dependent on any single end-use industry We have put in place an online IT infrastructure which we believe has helped to improve our operational efficiency. It has also enabled us to automate certain areas of our operations, thereby translating into a higher level of service and shorter lead times in response to our customers’ requests. With our IT infrastructure as our backbone, we believe that we have a scalable business model with which to drive our expansion plans. In addition, we believe that the extensive range of fastener products we carry, which can cater to a broad spectrum of industrial applications, coupled with our diversified base of customers across countries, means that we are not dependent on any single end-use industry. Experienced and committed management team Our Group is led by Teo Choon Hock and Kwek Keng Seng, each of whom has more than 30 years of experience in the fastener industry and who are instrumental in setting the strategic direction of our Group and in developing and expanding our business. Please refer to the section entitled “ General Information on Our Group – Competitive Strengths ” of this Offer Document for further details.

OUR BUSINESS STRATEGIES AND FUTURE PLANS Our business strategies and future plans are as follows: To enhance our existing warehouse facilities and upgrade our inventory management system We plan to enhance our existing warehouse facilities through a reorganisation of our warehouse space and installation of new racks in line with our expansion plans. We also plan to upgrade our inventory management system and will consider either installing a new inventory management system or upgrading our existing inventory management system so as to enhance our ability to more efficiently track and manage an increased inventory and achieve a faster turnaround time in processing our customers’ orders. To diversify our product range We have longstanding relationships with our customers and maintain frequent contact with them to better understand the market trends and their product demands and requirements. With this insight, we believe that we are in a better position to formulate appropriate strategies to expand our product range, thereby enabling us to meet our customers’ requirements of any mix of products and for any quantity for delivery on a timely basis. To expand our business through acquisitions, joint ventures and/or strategic alliances We may also expand our business, whether in Singapore or overseas, through acquisitions, joint ventures and strategic alliances that we believe will complement our current and future business. We believe that suitable acquisitions, joint ventures and strategic alliances will give us access to new markets and customers as well as new businesses. Please refer to the section entitled “ General Information on Our Group – Business Strategies and Future Plans ” of this Offer Document for further details.

26

OFFER DOCUMENT SUMMARY
WHERE YOU CAN FIND US Our registered office is located at 3 Kaki Bukit Road 2, #01-06 Eunos Warehouse Complex, Singapore 417837 and our principal place of business is located at 3 Kaki Bukit Road 2, #01-06/07 Eunos Warehouse Complex, Singapore 417837. Our telephone number is (65) 6747 7080 and our facsimile number is (65) 6742 0642. Our internet address is http://www.psfasteners.com. Information contained in our website does not constitute part of this Offer Document.

27

THE PLACEMENT
Placement size : Placement in respect of 20,400,000 Placement Shares. The Placement Shares shall, upon their issue and allotment, be free from all pre-emption rights, charges, liens and other encumbrances, and will rank pari passu in all respects with our existing issued Shares. Placement Price : S$0.25 for each Placement Share, payable in full on application. The Placement comprises a placement of 20,400,000 Placement Shares at the Placement Price, subject to and on the terms and conditions of this Offer Document. Our Directors believe that the listing of our Company and the quotation of our Shares on Catalist will enhance the public image of our Group locally and overseas and enable us to tap the capital markets for the expansion of our operations. The Placement will also provide members of the public with an opportunity to participate in the equity of our Company. Prior to the Placement, there has been no public market for our Shares. Our Shares will be quoted in Singapore dollars on Catalist, subject to the admission of our Company to Catalist and permission for dealing in, and for quotation of, our Shares (including the Placement Shares) being granted by the SGX-ST and the Authority not issuing a Stop Order. Investing in our Shares involve risks which are described in the section entitled “ Risk Factors ” of this Offer Document.

The Placement

:

Purpose of the Placement

:

Listing status

:

Risk factors

:

28

RISK FACTORS
Prospective investors should consider carefully and evaluate the following risk factors and all other information contained in this Offer Document, before deciding to invest in our Shares. You should also note that certain of the statements set forth below constitute “forward-looking statements” that may involve direct and/or indirect implications on our future performance. Our actual results may differ materially from those anticipated by these forward-looking statements due to certain factors, including the risks and uncertainties faced by us as described below and elsewhere in this Offer Document. If any of the following risk factors and uncertainties develops into actual events, our business, financial condition or results of operations or cash flows or prospects may be adversely affected. In such circumstances, the trading price of our Shares could decline and investors may lose all or part of their investment in our Shares. To the best of our Directors’ belief and knowledge, all the risk factors that are material to investors in making an informed judgement regarding our Group have been set out below. Please also refer to the section entitled “ General Information on Our Group – Prospects and Trends ” of this Offer Document. RISKS RELATING TO OUR BUSINESS AND INDUSTRY We are dependent on key personnel for our continued success Our Executive Chairman, Teo Choon Hock, and our Managing Director, Kwek Keng Seng are the founders of our Group and our continued growth and success depend on them leading our Group, in particular in terms of our overall management and business strategies. Teo Choon Hock and Kwek Keng Seng are supported by our Executive Officers and they possess the industry knowledge, are familiar with our business operations and have established good relationships with our customers and suppliers. However, there is no assurance that we will be able to continue to retain the services of our key personnel. The resignation or the loss of the services of Teo Choon Hock and/or Kwek Keng Seng or of any of our key personnel without suitable and timely replacement or the inability to attract and retain qualified management personnel in line with our growth will adversely affect our operations and hence, our revenue and profits. Currently, we do not have keyman insurance coverage for any of our key personnel, including Teo Choon Hock and Kwek Keng Seng. Please refer to the section entitled “ Directors, Management and Staff ” of this Offer Document for further details. We may be affected by downturns in the countries where we supply our products to, in particular, Singapore, Malaysia and Indonesia We believe that given the wide spectrum of commercial and industrial applications of fasteners, the fastener industry is not dependent on any single end-use industry, but is generally dependent on factors such as industrial and infrastructure development and general economic conditions. Over the last three financial years ended 31 December 2012, approximately 16.8%, 24.7% and 27.2% of our revenue was derived from sales to Singapore, Malaysia and Indonesia, respectively. In the event that there is an economic downturn or political or social uncertainty or other developments resulting in a sustained weakness in demand for fasteners in the countries where we supply our products to, in particular, Singapore, Malaysia and Indonesia, our sales may be affected and this may materially and adversely affect our business, results of operations and prospects.

29

RISK FACTORS
We may be affected by disruptions in the global financial markets and the sovereign debt markets During the global financial crisis between 2007 and 2009, disruptions in the global financial markets coupled with the repricing of credit risks, the deterioration of the housing markets in the western countries and a slowdown in the global economy had resulted in historic volatility, tight liquidity, widening of credit spreads and a lack of price transparency in certain markets. These conditions had resulted in the failures of a number of financial institutions and unprecedented action by government authorities and central banks around the world. Rising sovereign debt levels coupled with the downgrading of sovereign debts in certain western countries had made it difficult or close to impossible for these countries to refinance their debts and resulted in the sovereign debt crisis in these economies. Due to the interconnectedness of the world’s economy, the extended downturn in the west had reverberated across other economies elsewhere and this has caused increasingly difficult and volatile economic and financial conditions in the global markets. Although government authorities and central banks have introduced stimulus measures to support the economies, it is difficult to predict how long these conditions will persist, whether conditions will normalise without the stimulus measures, what structural and/or regulatory changes may result from these conditions or how frequently such crisis will recur in the future. Such conditions are outside of our control but they would have a material adverse effect on our ability and cost of accessing the financial markets, our profitability, financial condition and prospects. We are vulnerable to increases in the cost of fastener products Raw materials, such as steel, brass and aluminium, are used in the production of fastener products. An increase in the prices of such raw materials will likely result in an increase in the price of fastener products that we purchase from fastener manufacturers. In the event that we are unable to pass on any increase in the prices to our customers, our profit margins will be compressed and consequently, our business, results of operations and prospects may be materially and adversely affected. We do not have long-term purchase commitments from our customers and may not be able to retain our existing customers Our customers do not commit to definite and long-term purchase arrangements for the various products supplied by us. Our customers, mainly being other distributors with retail networks, may decide to purchase directly from fastener manufacturers or other fastener suppliers. If a significant number of our customers were to buy from other sources, then our business, results of operations and prospects will be adversely affected. In addition, while we have good business relationships with our customers, there can be no assurance that they will not significantly reduce their orders with us or will continue to place orders with us in the future. In such an event, if we are unable to secure alternative orders of comparable size, whether from new or existing customers, our business, results of operations and prospects will be adversely affected. We may be affected by inventory holding costs and a downward adjustment in the net realisable value of our inventory We have been adopting a strategy of keeping a ready inventory of products so that we would be better able to meet the immediate demands of our customers. Our level of inventory is mainly based on the actual and anticipated demand for specific products from our customers as well as the cost of purchases.

30

RISK FACTORS
As at 31 December 2012, our inventory accounted for approximately 75.8% of our current assets. Our inventory turnover days for each of FY2010, FY2011 and FY2012 were 217 days, 236 days and 305 days, respectively. As a result of holding and managing a significant level of inventory, we may incur high holding costs such as financing costs, warehousing and logistic costs and insurance costs. A significant increase in these costs may have a material and adverse impact on our results of operations and financial position. While our inventory range and inventory levels are reviewed regularly to ensure that we have sufficient inventory on hand to meet confirmed and projected sales orders, we are unable to predict with certainty our customers’ orders. There is also no certainty that our customers will not reschedule delivery of their purchases or cancel their orders. In the event that we are unable to convert our inventory into sales with a satisfactory profit margin, our operating cashflow, results of operations and financial position will be materially and adversely affected. In addition, as our accounting policies require us to record our inventory at the lower of cost or net realisable value, any downward adjustment in the carrying value of our inventory may have a material adverse impact on our results of operations and financial position. Please refer to the section entitled “ General Information on Our Group – Inventory Management ” of this Offer Document for more details. We are dependent on our major suppliers who account for a significant portion of our purchases Although we have not experienced any significant problems with our major suppliers and have maintained good business relationships with them since we began making purchases from them, there can be no assurance that our business relationships will remain cordial and/or that we will be able to continue obtaining supplies from them on terms which are acceptable to us. Our purchases from our major suppliers accounted for, in aggregate, approximately 91.1%, 89.5% and 89.6% of our total purchases in FY2010, FY2011 and FY2012, respectively. Please refer to the section entitled “ General Information on Our Group – Major Suppliers ” of this Offer Document for further details of our major suppliers. We have distribution agreements with certain of our major suppliers and one of our distribution agreements with these major suppliers is non-exclusive. In the event that any of our major suppliers were to supply our competitors with their products in the territories that we have non-exclusivity in, competition will increase and our business, results of operations and prospects may be materially and adversely affected. Please refer to the section entitled “ General Information on Our Group – Distribution Agreements ” of this Offer Document for further details of our distribution agreements. In addition, our distribution agreements with our major suppliers are subject to renewal and there can be no assurance that we will be able to successfully renew these agreements on terms acceptable to us, or at all, in which case, our business, results of operations and prospects may be materially and adversely affected. If any of our major suppliers are unable to fulfil our purchase requirements, we may not be able to seek alternative sources of products in time, or we may be subject to higher costs from alternative suppliers. In addition, notwithstanding that our products are typically generic in nature, there is no assurance that such alternative sources of products will be acceptable to our customers. Further, any significant delay or disruption in the delivery schedules of our purchase

31

RISK FACTORS
orders, to the extent that it causes a shortage in our inventory or range of products available, may affect our ability to meet our customers’ orders, resulting in lost sales and hence may materially and adversely affect our business, results of operations and prospects. We require adequate working capital to fund our operations We will require adequate funding either from internal resources or borrowings to fund the working capital of our business. Our ability to arrange adequate financing on terms which are acceptable depends on a number of factors that are beyond our control, including general economic, liquidity and political conditions, the terms on which financial institutions are willing to extend credit to us, and the availability of other sources of debt financing or equity financing. If we are unable to secure adequate financing, our business and growth may be adversely affected. There is no assurance that our future plans will be commercially successful Our growth strategies include enhancing our warehouse facilities, upgrading our inventory management system, diversifying our product range and expanding our business through acquisitions, joint ventures and/or strategic alliances. Please refer to the section entitled “ General Information on Our Group – Business Strategies and Future Plans ” of this Offer Document for more details. These expansion plans will require substantial capital expenditure, financial and management resources and expose our business to unforeseen liabilities and risks associated with entering new markets or new businesses which we have no experience in. There is no assurance that such future plans will be commercially successful and if for any reason, we fail to manage our expansion efficiently or execute our plans or integrate them successfully with our existing operations, our business, results of operations and prospects may be materially and adversely affected. We may require additional funding for our future growth Although we have identified our future growth plans as set out in the section entitled “ General Information on Our Group – Business Strategies and Future Plans ” of this Offer Document, the net proceeds from this Placement will not be sufficient to fully cover the estimated costs of implementing all these plans. We may also identify future opportunities to grow either organically or through acquisitions or otherwise which we have yet to identify at this juncture. Hence, we may need to obtain additional debt or equity financing to fund these plans. Any new Shares which are issued to finance our expansion plans could result in dilution in the interests of our Shareholders. If such financing does not generate a commensurate increase in earnings, our EPS will be diluted, and this could also lead to a decline in our Share price. Additional debt financing may, apart from increasing interest expenses and gearing, subject us to various restrictive covenants and result in all or any of the following: (a) (b) (c) limit our ability to pay dividends; increase our vulnerability to general adverse economic and industry conditions; require us to dedicate a substantial portion of our cash flows from operations to payments on our debt, thereby reducing the availability of our cash flows to fund capital expenditure, working capital and other requirements; and/or limit our flexibility in planning for, or reacting to, changes in our business and our industry. 32

(d)

RISK FACTORS
There is no assurance that we will be able to obtain additional equity and/or debt financing on terms that are acceptable to us or at all. Any inability to secure additional equity and/or debt financing may materially and adversely affect our business, implementation of our business strategies and future plans, results of operations and financial condition. We operate in a highly competitive environment and face competition from existing competitors and new market entrants We operate in a highly competitive environment. We generally compete with our competitors on, among other things, competitive pricing, good customer and delivery service and the quality of our products. There is no assurance that we can continue to compete against our competitors successfully in the future. We may face more intense competition in the future from existing competitors and new market entrants. Our competitors or potential competitors may be in a better position to expand their market share, whether because they have longer operating histories, larger customer base, greater access to suppliers, wider range of products, greater financial resources or otherwise. Increased competition may result in lower demand for our products, lower profit margins and/or loss of market share. If we fail to compete effectively, and to maintain or grow our market share, our business, results of operations and prospects will be adversely affected. Please refer to the section entitled “ General Information on Our Group – Competition ” of this Offer Document for more information. We face risks of payment delays and/or default by customers whom we have extended credit to As at 31 December 2012, our trade receivables were approximately S$1.9 million and accounted for approximately 18.8% of our current assets. We may extend credit terms ranging from 30 days to 60 days on a case-by-case basis to our customers, depending on, inter alia , the length of the customer relationship and their credit-worthiness. For FY2010, FY2011 and FY2012, our trade receivables turnover days were approximately 58 days, 56 days and 59 days, respectively. We have not written off or provided for any bad or doubtful debts during the period under review and up to the Latest Practicable Date. Our credit customers may be unable to meet their contractual payment obligations to us, either in a timely manner or at all. In addition, our customers may cancel their orders. The reasons for payment delays, cancellations or default may include, inter alia , our customers’ insolvency or bankruptcy, or inability to raise sufficient financing. Further, we may not be able to enforce our contractual rights to receive payment through legal proceedings. A material increase in bad and doubtful debts will adversely affect our business, results of operations and prospects. We face the risk of operating from a single location All of our operations are housed in one location at 3 Kaki Bukit Road 2, #01-06/07 Eunos Warehouse Complex. Should we be unable to operate out of Eunos Warehouse Complex or should our operations at Eunos Warehouse Complex be temporarily or permanently disrupted whether because of fire, accidents, the spread of communicable disease, any debarment from usage by the government or other circumstances, our business, results of operations and prospects will be materially and adversely affected.

33

RISK FACTORS
We are exposed to the risks of intellectual property infringement or may face litigation suits for intellectual property infringement We have registered a trademark in Singapore and have made an application to register our trademark in Malaysia. There is no assurance that our application will be successful. We are not aware of any violations or infringements of our intellectual property rights over the period under review and for the period from 1 January 2013 to the date of this Offer Document. However, there is no assurance that third parties will not infringe our intellectual property rights in ways that will have negative repercussions on our reputation, business and results of operations or that measures taken by us will be effective in protecting our intellectual property rights. In the event that third parties unlawfully infringe on our intellectual property rights, we may face considerable difficulties and costly litigation in order to fully protect our intellectual property rights which may in turn adversely affect our business, reputation, operations, results of our operations, financial condition and prospects. Please refer to the section entitled “ General Information on Our Group – Intellectual Property ” of this Offer Document for further details of our intellectual property. Pursuant to our distribution agreements with certain of our major suppliers, we are allowed to use certain of their logos and trademarks in our advertising material. Please refer to the section entitled “ General Information on Our Group – Distribution Agreements ” of this Offer Document for further details of our intellectual property. However, we may, in future, receive allegations from third parties asserting the infringement of their intellectual property rights in relation to our business and operations. Any claim or litigation against us in respect of the infringement of intellectual property rights of third parties, whether with or without merit, could divert a significant amount of our management, financial and other resources and could also affect our reputation with our customers and suppliers which would in turn, have a material and adverse effect on our business, results of operations and prospects. We may be affected by any adverse impact on our reputation and goodwill We have built our reputation as a reliable supplier of quality fasteners. Any negative publicity about us, our Directors, our Executive Officers or our Substantial Shareholders, whether founded or unfounded may tarnish our reputation and goodwill with our customers and suppliers. Such negative publicity or announcement may include, inter alia , unsuccessful attempts in joint ventures, acquisitions or takeovers, or involvement in litigation or insolvency proceedings. Under these circumstances, our customers and suppliers may lose confidence in our business, our Directors, our Executive Officers or our Substantial Shareholders, and this could affect our business relationships with them and their referral of new business opportunities. This may have a material and adverse impact on our business, results of operations, prospects and the Share price performance of our Company. To the best of our Directors’ knowledge and belief, none of our existing Directors, Executive Officers or Substantial Shareholders nor our Group is presently involved in any litigation or insolvency proceedings. Our insurance coverage may not be adequate We have taken up insurance policies for risks such as fire, public liability and work injury compensation. However, no insurance can compensate for all potential losses and there can be no assurance that our insurance coverage will be adequate or that our insurers will pay a particular claim. We do not have keyman insurance coverage for our key personnel, including Teo Choon Hock and Kwek Keng Seng. There are also certain types of risks that are not covered by our insurance policies because they are either uninsurable or not economically insurable, 34

RISK FACTORS
including acts of war and acts of terrorism. In addition, we are not insured against business disruption. If such events were to occur, we may have to bear the costs of any uninsured risk or uninsured amount, which can have a material and adverse effect on our business, results of operations, financial condition and prospects. We may face foreign exchange transaction exposure For the last three financial years ended 31 December 2012, approximately 75.8% and 24.2% of our revenue was denominated in S$ and US$, respectively, while approximately 91.3% of our cost of purchases, which constitutes a significant proportion of our total expenses, was denominated in US$. To the extent that our revenue and costs are not perfectly matched in the same currency and that there are time gaps between invoicing and payment, we will be exposed to foreign exchange fluctuations against our functional and reporting currency in S$. Accordingly, any significant foreign currency fluctuations against the S$ may have an impact on our results of operations. In FY2010 and FY2012, we recorded a net foreign exchange loss of approximately S$17,000 and S$38,000 respectively, as compared to a net foreign exchange gain of approximately S$4,000 in FY2011. To fund our Group’s purchases with our suppliers and to manage our foreign exchange exposure, our Group typically draws down on our trust receipt facilities with banks, and fixes the S$ to US$ exchange rate on amounts owing by our Group to our suppliers that are denominated in US$ as part of this process, thereby converting and crystallising the US$ liability into a S$ liability from our Group’s perspective. Consequently, we do not have a formal foreign currency hedging policy with respect to our foreign exchange exposure. As at the date of this Offer Document, we have not used any financial hedging instruments to manage our foreign exchange risk. We will continue to monitor our foreign exchange exposure and may employ hedging instruments to manage our foreign exchange exposure should the need arise in the future. If necessary, we will seek the approval of our Board on the policy for entering into any foreign exchange hedging transactions and will put in place adequate procedures which will be reviewed and approved by our Audit Committee. Our operations are subject to the negative impact of government import policies and tariffs We export a significant proportion of our products which may be subject to import taxes or other import controls in certain countries. Although import taxes are generally paid by customers importing our products, other import controls may also affect the overall cost and saleability of our products relative to identical products imported from other countries which may be subject to lower import taxes or less stringent import controls or none at all. If our products are subject to import taxes or other import controls in the countries that we export to and we are unable to take advantage of applicable tax treaties or free trade or similar agreements with these countries, or if such tax treaties or other tax concessions are abolished, we may not be able to compete effectively against our overseas competitors whose products may not be subject to similar import taxes or other import controls, or who enjoy more favourable treatment for their products than us, which in turn could have an adverse effect on our business, results of operations, financial condition and prospects. In addition, any material changes in the import policies of our export markets, such as an import ban or an increase in import taxes or other similar or related actions by the various governments, would adversely affect the price competitiveness of our products.

35

RISK FACTORS
An outbreak of communicable diseases, severe weather conditions, natural disasters or other incidents may affect us, our customers and our suppliers which if uncontrolled, would affect our financial performance and conditions In recent years, the outbreaks of various communicable diseases such as severe acute respiratory syndrome and the avian influenza have resulted in global economic and social uncertainties. Severe weather conditions, natural disasters such as earthquakes and other incidents such as terrorist attacks or armed conflicts or riots have from time to time disrupted business operations and caused widespread destruction. If any of these occurrences were to happen to any of our major customers, major suppliers or their employees or to us or our employees, our business, results of operations, financial condition and prospects would be materially and adversely affected. RISKS RELATING TO OWNERSHIP OF OUR SHARES Investments in securities quoted on Catalist involve a higher degree of risk and can be less liquid than shares quoted on the Main Board of the SGX-ST We have made an application for our Shares to be admitted to Catalist, a listing platform primarily designed for fast growing and emerging or smaller companies to which a higher investment risk tends to be attached as compared to larger or more established companies listed on the Main Board of the SGX-ST. An investment in shares quoted on Catalist may carry a higher risk than an investment in shares quoted on the Main Board of the SGX-ST and the future success and liquidity in the market of our Shares cannot be guaranteed. Pursuant to the Listing Manual, we are required to, inter alia, retain a sponsor at all times after the admission of our Company to Catalist. In particular, unless approved by the SGX-ST, the Sponsor must act as our continuing sponsor for at least three years after the admission of our Company to Catalist. In addition, we may be delisted in the event that we do not have a sponsor for more than three continuous months. There is no guarantee that following the expiration of the three-year period, the Sponsor will continue to act as our sponsor or that we are able to find a replacement sponsor within the three-month period. Should such risks materialise, we may be delisted. There has been no prior market for our Shares and the Placement may not result in an active or liquid market Prior to the Placement, there has been no public market for our Shares. Although we have made an application to the SGX-ST to list our Shares on Catalist, there is no assurance that an active trading market for our Shares will develop, or if it develops, be sustained. The rules of the Listing Manual require that companies applying for listing of their equity securities on Catalist meet certain minimum shareholding spread and distribution requirements. While we will need to meet these requirements in order to list our Shares on Catalist, these requirements are only minimum requirements and our shareholding distribution in the Placement and our post-Placement shareholding spread may not substantially exceed these limits or may even fall below these limits after the Placement. In the case where the percentage of our post-Placement share capital held by public shareholders is less than 10%, the SGX-ST may suspend trading of our Shares. As a result, liquidity of our Shares can be materially curtailed and there may be no or limited trading in our Shares, and you may not be able to acquire Shares or sell your Shares in our Company, either at a favourable price or at all. In addition, if shares, such as our Shares, have only limited liquidity, the price of such shares can fluctuate significantly as a result of only one or a small number of trades in these shares.

36

RISK FACTORS
Control by our Controlling Shareholders may limit your ability to influence the outcome of decisions requiring the approval of Shareholders Upon completion of the Placement, our Controlling Shareholders will collectively own 70.0% of our post-Placement share capital. By virtue of their controlling ownership of our share capital, our Controlling Shareholders will be able to exert significant influence over our business and otherwise on matters of significance to us and other Shareholders by voting at our Company’s general meetings of Shareholders, including: (a) (b) (c) (d) (e) (f) election of directors; amount and timing of dividend payments and other distributions; acquisition of or merger with another entity; overall strategic and investment decisions; issuance of securities and adjustment to our capital structure; and amendments to our Articles of Association.

Our Controlling Shareholders will collectively have veto power with respect to any Shareholders’ action or approval requiring a majority vote except where they are required by the relevant laws, rules and regulations to abstain from voting. Such concentration of ownership also may have the effect of delaying, preventing or deterring a change in control of our Group even if such change may be beneficial to our minority public Shareholders. Investors in our Shares will face immediate and substantial dilution in our NTA per Share and may experience future dilution Our Placement Price of S$0.25 per Share is substantially higher than our audited NTA per Share as at 31 December 2012 of S$0.16 after adjusting for the estimated net proceeds due to our Company from the Placement and based on the post-Placement issued share capital. If we were liquidated for NTA immediately following the Placement, each Shareholder subscribing to the Placement would receive less than the Placement Price they paid for their Shares. Details of the immediate dilution of our Shares incurred by new investors are described under the section entitled “ Dilution ” of this Offer Document. Further, if we were to raise funds in the future by way of a placement of Shares, rights issue, or other equity-linked securities for our future equity or equity-linked growth, investments, capital expenditure, and working capital, and if any Shareholder is not entitled, unable or unwilling to participate in such fund-raising, such Shareholder will suffer dilution in their shareholdings in our Company. Further, an issue of our Shares below the then prevailing market price will also affect the value of our Shares then held by an investor. Dilution may occur in shareholding terms even if the issue of Shares is at a premium to the market price. Future sales or issuance of our Shares by our Company or future sales of our Shares by Shareholders could materially and adversely affect our Share price Any future sale or issuance or availability of a large number of our Shares in the public market after the Placement or perception thereof can have a downward pressure on our Share price. These factors could also affect our ability to sell additional equity securities in the future, at a time and price we deem appropriate. In addition, our Share price may come under downward pressure

37

RISK FACTORS
if certain of our Shareholders sell their Shares upon the expiry of their moratorium periods. Save as disclosed under the section entitled “ Shareholders – Moratorium ” of this Offer Document, there is no other restriction on the ability of our Shareholders to dispose of their shareholdings. Investors may not be able to participate in future issues of our Shares In the event that we issue new Shares, we will be under no obligation to offer those Shares to our existing Shareholders at the time of issue, except where we elect to conduct a rights issue. If we offer to our Shareholders rights to subscribe for additional Shares or any rights of any other nature or other equity issues, we will have the discretion and be subject to the relevant laws, rules and regulations as to the procedures to be followed in making such rights offering available to our existing Shareholders or in disposing of such rights for the benefit of such Shareholders and making the net proceeds available to them. We may choose not to offer the rights or other equity issues to our Shareholders or investors having an address outside Singapore, hence overseas Shareholders or investors may be unable to participate in future offerings of our Shares and may experience dilution of their interests in our Company. Our Share price may be volatile in future which could result in substantial losses for investors purchasing Shares pursuant to the Placement The trading price of our Shares may fluctuate significantly and rapidly after the Placement as a result of, among others, the following factors, some of which are beyond our control: (a) (b) (c) variations of our operating results; changes in analysts’ recommendations or estimates of our financial performance; changes in market valuations and share prices of companies with businesses similar to that of our Group that may be listed in Singapore or elsewhere; announcements by us of significant acquisitions, strategic alliances or joint ventures; fluctuations in stock market prices and volume; our involvement in material litigation; additions or departures of our key management personnel; material changes or uncertainty in the political, economic and regulatory environment in the markets that we operate or have business relationships with; success or failure of our efforts in implementing business and growth strategies; and changes in conditions affecting the industry in which we operate, the general economic conditions or stock market sentiments or other events or factors.

(d) (e) (f) (g) (h)

(i) (j)

There is also no assurance that the market price for our Shares will not decline below the Placement Price. The Placement Price may not be indicative of prices that may prevail in the trading market after the Placement. Investors may not be able to sell their Shares at or above the Placement Price. The market price of our Shares could be subject to significant fluctuations due to various external factors and events including the liquidity of our Shares in the market, difference between our actual financial or operating results and those expected by investors and analysts, the general market conditions and broad market fluctuations.

38

PLACEMENT STATISTICS
Placement Price NAV NAV per Share based on the audited combined balance sheet of our Group as at 31 December 2012: (a) before adjusting for the estimated net proceeds from the Placement and based on our Company’s pre-Placement share capital of 47,600,000 Shares after adjusting for the estimated net proceeds from the Placement and based on our Company’s post-Placement share capital of 68,000,000 Shares 14.3 cents S$0.25

(b)

15.6 cents

Premium of Placement Price over the NAV per Share as at 31 December 2012: (a) before adjusting for the estimated net proceeds from the Placement and based on our Company’s pre-Placement share capital of 47,600,000 Shares after adjusting for the estimated net proceeds from the Placement and based on our Company’s post-Placement share capital of 68,000,000 Shares 74.8%

(b)

59.9%

EPS Historical EPS based on the audited combined statement of comprehensive income of our Group for FY2012 and our Company’s pre-Placement share capital of 47,600,000 Shares Historical EPS based on the audited combined statement of comprehensive income of our Group for FY2012 and our Company’s pre-Placement share capital of 47,600,000 Shares, had the Service Agreements and the Directors’ fees payable to the Executive Directors for FY2013 been in effect since 1 January 2012 PER Historical PER based on the Placement Price and the historical EPS for FY2012 and our Company’s pre-Placement share capital of 47,600,000 Shares Historical PER based on the Placement Price and the historical EPS for FY2012 and our Company’s pre-Placement share capital of 47,600,000 Shares, had the Service Agreements and the Directors’ fees payable to the Executive Directors for FY2013 been in effect since 1 January 2012 Net operating cash flow(1) Historical net operating cash flow per Share based on the audited combined statement of comprehensive income of our Group for FY2012 and our Company’s pre-Placement share capital of 47,600,000 Shares Historical net operating cash flow per Share based on the audited combined statement of comprehensive income of our Group for FY2012 and our Company’s pre-Placement share capital of 47,600,000 Shares, had the Service Agreements and the Directors’ fees payable to the Executive Directors for FY2013 been in effect since 1 January 2012 2.6 cents 10.9 times 10.4 times 2.3 cents

2.4 cents

2.7 cents

39

PLACEMENT STATISTICS
Price to net operating cash flow ratio Placement Price to historical net operating cash flow per Share based on the audited combined statement of comprehensive income of our Group for FY2012 and our Company’s pre-Placement share capital of 47,600,000 Shares Placement Price to historical net operating cash flow per Share based on the audited combined statement of comprehensive income of our Group for FY2012 and our Company’s pre-Placement share capital of 47,600,000 Shares, had the Service Agreements and the Directors’ fees payable to the Executive Directors for FY2013 been in effect since 1 January 2012 Market capitalisation Our market capitalisation based on the Placement Price and our Company’s post-Placement share capital of 68,000,000 Shares
Note: (1) Net operating cash flow is defined as net profit attributable to equity holders of our Company with depreciation added back.

9.6 times

9.2 times

S$17.0 million

40

USE OF PROCEEDS AND LISTING EXPENSES
USE OF PROCEEDS The estimated net proceeds from the Placement (after deducting the estimated expenses incurred in connection with the Placement) is approximately S$3.8 million. Each of the principal intended use of proceeds from the Placement and major expenses is set out below: Estimated amount allocated for each dollar of the gross proceeds raised from the Placement (as a % of gross proceeds)

Use of proceeds from the Placement To enhance our existing warehouse facilities and upgrade our inventory management system General working capital Net proceeds Expenses Professional fees (2) Placement commission and brokerage Miscellaneous expenses (including listing fees) Gross proceeds
Notes: (1) (2)
(3) (1)

Amount in aggregate (S$’000)

1,000 2,831 3,831

19.6 55.5 75.1

885 153 231 5,100

17.4 3.0 4.5 100.0

To be applied mainly to the purchase of our inventory and towards our plans to diversify our product range. This includes (i) the management fees payable to the Sponsor; and (ii) the fees payable to the Solicitors to the Placement, Solicitors to the Sponsor and Placement Agent, and the Independent Auditors and Reporting Accountants. Pursuant to the Placement Agreement, the Placement Agent has agreed to subscribe and/or procure subscribers for the Placement Shares for a placement commission and brokerage of 3.0% of the Placement Price for each Placement Share. Subscribers of the Placement Shares may be required to pay a brokerage of up to 1.0% of the Placement Price (and the prevailing GST thereon, if applicable) to the Placement Agent or any sub-placement agent that may be appointed by the Placement Agent.

(3)

Should the net proceeds from the Placement exceed the amount estimated in this section, the excess will be applied towards our Group’s working capital. In the reasonable opinion of our Directors, there is no minimum amount which must be raised by the Placement. As at the date of this Offer Document, we are not engaged in any discussion with any party for acquisitions, joint ventures or strategic alliances. Pending the deployment of the net proceeds from the Placement, the funds will be placed in deposits with banks and financial institutions or invested in money market instruments or used for our working capital requirements as our Directors may deem fit at their absolute discretion.

41

USE OF PROCEEDS AND LISTING EXPENSES
The discussion above represents our Company’s reasonable estimate of its allocation of the net proceeds of the Placement based upon its current plans for our Group and reasonable estimates regarding its anticipated expenditures. Actual expenditures may vary from these estimates and our Company may find it necessary or advisable to reallocate the net proceeds within the categories described above or to use portions of the net proceeds for other purposes. In the event that our Company decides to reallocate the net proceeds of the Placement for other purposes, our Company will publicly announce its intention to do so through an SGXNET announcement to be posted on the internet at the SGX-ST website at http://www.sgx.com. Please refer to the section entitled “ General Information on Our Group – Business Strategies and Future Plans ” of this Offer Document for further details. Expenses incurred in connection with the Placement In accordance with the Singapore Financial Reporting Standards, a portion of the listing expenses incurred in connection with the Placement amounting to approximately S$608,000 will be treated as a charge in our financial statements, which will affect our financial results in FY2013.

42

CAPITALISATION AND INDEBTEDNESS
The following information should be read in conjunction with the full text of this Offer Document, including the “ Audited Combined Financial Statements Of PS Group Holdings Ltd. And Its Subsidiary For The Financial Years Ended 31 December 2010, 2011 And 2012 ” as set out in Appendix A of this Offer Document and the section entitled “ Management’s Discussion and Analysis of Financial Position and Results of Operations ” of this Offer Document. The following table shows the cash and cash equivalents as well as capitalisation and indebtedness of our Group as at 30 April 2013, being a date no earlier than 60 days before the date of lodgement of this Offer Document: (a) (b) (c) based on our audited combined balance sheet as at 31 December 2012; based on our unaudited management accounts as at 30 April 2013; and as adjusted for the Restructuring Exercise, the Share Split and the net proceeds from the Placement (“ As Adjusted ”). As at 31 December 2012 (Audited) 335 As at 30 April 2013 (Unaudited) 733 As at 30 April 2013 (As Adjusted) 4,564

(S$’000) Cash and cash equivalents Indebtedness Current – secured and guaranteed – secured and non-guaranteed – unsecured and guaranteed – unsecured and non-guaranteed (1) Non-current – secured and guaranteed – secured and non-guaranteed – unsecured and guaranteed – unsecured and non-guaranteed Total indebtedness Equity attributable to owners of the Company Share capital Retained earnings Total equity Total capitalisation and indebtedness

1,743 – – 2,600 500 – – – 4,843

3,539 – – 1,600 389 – – – 5,528

3,539 – – 1,600 389 – – – 5,528

400 6,404 6,804 11,647

400 6,696 7,096 12,624

4,979 6,151 11,130 16,658

Note: (1) This refers to the interest-free loans extended to us by our Executive Directors, Teo Choon Hock and Kwek Keng Seng. Please refer to the section entitled “Interested Person Transactions – Past Interested Person Transactions” of this Offer Document for more details.

43

CAPITALISATION AND INDEBTEDNESS
As at the Latest Practicable Date, we had secured banking facilities of approximately S$10.5 million and US$250,000 (which include bank overdraft facilities, trade finance facilities and foreign exchange facilities) of which S$5.7 million was utilised, leaving a balance of S$4.8 million and US$250,000 available for utilisation. Interest on overdraft facilities, trade finance facilities and foreign exchange facilities, range from 1.4% to 6.8% per annum or such other rate(s) as the respective financial institutions may determine from time to time. Details of our banking facilities as at the Latest Practicable Date are set out in the table below:
Amount of facility granted (S$’000) 100 800 50 600 2,000 Amount of facility utilised (S$’000) – 642 – – 355 Amount of facility unutilised (S$’000) 100 158 50 600 1,645

Facility Overdraft Import line Clean bills purchase Foreign exchange Letter of credit, trust receipt, import loan, import invoice financing and shipping guarantee(1) Term loan Revolving credit Letter of credit, trust receipt and shipping guarantee

Lender DBS Bank Ltd DBS Bank Ltd DBS Bank Ltd DBS Bank Ltd Standard Chartered Bank

Maturity profile Revolving Up to 150 days Revolving Revolving Up to 120 days

Malayan Banking Berhad Malayan Banking Berhad Malayan Banking Berhad

1,000 1,000 1,500

1,000(2) 1,000 1,189

– – 311

3 years from 1 June 2012 Revolving Up to 90 days (letter of credit) and up to 120 days (trust receipt) Up to 180 days 5 years from 6 May 2013 Up to 120 days Up to 6 months

Foreign exchange Term loan Letter of credit and trust receipts Foreign exchange
Notes: (1)

Malayan Banking Berhad UOB UOB UOB

US$250 1,500 1,000 1,000

– 1,500(3) – –

US$250 – 1,000 1,000

Due to the discharge of the mortgage in favour of Standard Chartered Bank at 3 Kaki Bukit Road 2, #01-07 Eunos Warehouse Complex, Singapore 417837, Standard Chartered Bank has, as at the Latest Practicable Date, withdrawn the overdraft facility granted to us and has reduced the trade finance facility from S$2.5 million to S$2.0 million. We are currently finalising the terms of the revised facility letter with Standard Chartered Bank. We have utilised S$1.0 million of this term loan facility and the amount outstanding as at the Latest Practicable Date is S$694,000. We have utilised S$1.5 million of this term loan facility and the amount outstanding as at the Latest Practicable Date is S$1.5 million.

(2) (3)

44

CAPITALISATION AND INDEBTEDNESS
Our banking facilities are secured by one or several of (a) personal guarantees by our Executive Directors, Teo Choon Hock and Kwek Keng Seng; and (b) a mortgage over our properties at 3 Kaki Bukit Road 2 #01-06 and 3 Kaki Bukit Road 2 #01-07, Singapore 417837. For further details of the guarantees provided by our Executive Directors, please refer to the section entitled “ Interested Person Transactions – Present and On-going Interested Person Transactions ” of this Offer Document. Following the admission of our Company to Catalist, we intend to procure a release and discharge of the aforementioned guarantees from the relevant financial institutions. If we are unable to procure the release and discharge of these guarantees, Teo Choon Hock and Kwek Keng Seng will either continue to provide the guarantees required to secure these banking/credit facilities or seek and obtain alternative facilities from other financial institutions offering comparable terms without the need for such personal guarantees. Since 30 April 2013 up to the Latest Practicable Date, there were no material changes in our capitalisation and indebtedness as disclosed above, save for our partial repayment of the interest-free loans extended to us by our Executive Directors of S$1.6 million that were outstanding as at 30 April 2013, changes in the amounts of banking facilities utilised, and changes in our retained earnings arising from our day-to-day operations in the ordinary course of business. As at the date of this Offer Document, all loans owing by us to our Executive Directors have been fully repaid. To the best of our Directors’ knowledge and belief, we are not in breach of any of the terms and conditions or covenants associated with any credit arrangement or bank loan which could materially affect our financial position or financial results or business operations and none of our Controlling Shareholders’ Shares have been pledged, charged or mortgaged as collateral to secure any credit or banking facilities. Certain of our banking/credit facilities as described in this section contain provisions which require us to obtain consent from the relevant financial institution prior to any substantial change in the shareholdings of Shareholders. As at the date of this Offer Document, our Group has, in anticipation of the Placement, obtained letters of consent in relation to such provisions from the financial institutions which have provided such facilities. For the banking/credit facilities with UOB, the consent granted was subject to Teo Choon Hock and Kwek Keng Seng remaining the legal and registered owners of an aggregate of not less than 51% of the shareholdings of the Company. Pursuant to Rule 728 of the Listing Manual, Teo Choon Hock and Kwek Keng Seng, being Controlling Shareholders of our Company, have each provided an undertaking to our Company that he will notify our Company, as soon as he becomes aware of any share pledging arrangements relating to his Shares and of any event which may result in a breach of our Group’s loan provisions. Upon notification by any of the Controlling Shareholders, our Company will make the necessary announcement(s) in compliance with the said rule. In the event that any Group company enters into a loan agreement or issues debt securities that contain a condition making reference to shareholding interests of any Controlling Shareholder, or places restrictions on any change in control of our Group, and the breach of this condition or restriction will cause a default in respect of the loan agreement or debt securities, significantly affecting the operations of our Group, we will immediately announce the details of the condition(s) in accordance with Rule 704(33) of the Listing Manual, making reference to the shareholding interests of such Controlling Shareholder or restrictions placed on any change in control of our Company and the aggregate level of these facilities that may be affected by a breach of such condition or restriction.

45

CAPITALISATION AND INDEBTEDNESS
Save as disclosed above, we have no other borrowings or indebtedness in the nature of borrowings including bank overdrafts and liabilities under acceptances (other than normal trading credits) or acceptance credits, mortgages, charges, finance lease commitments, guarantees or other material contingent liabilities.

46

DIVIDEND POLICY
Save as disclosed below, neither our Company nor our subsidiary has declared or paid any dividends for each of the last three financial years ended 31 December 2012 and for the period from 1 January 2013 to the Latest Practicable Date: Net dividends paid (S$) 1 January 2013 to the Latest Practicable Date Per Total share – –

FY2010 Per Total share PS Fasteners 800,032 2.00

FY2011 Per Total share 800,032 2.00

FY2012 Per Total share 800,032 2.00

Our Company currently does not have a fixed dividend policy. The form, frequency and amount of future dividends on our Shares that our Directors may recommend or declare in respect of any particular financial year or period will be subject to the factors outlined below as well as any other factors deemed relevant by our Directors: (a) (b) (c) (d) (e) the level of our cash and retained earnings; our actual and projected financial performance; our projected levels of capital expenditure and expansion plans; our working capital requirements and general financing condition; and restrictions on payment of dividends imposed on us by our financing arrangements (if any).

Our Company may declare dividends by way of an ordinary resolution of our Shareholders at a general meeting, but may not pay dividends in excess of the amount recommended by our Board of Directors. The declaration and payment of dividends will be determined at the sole discretion of our Directors, subject to the approval of our Shareholders. Our Directors may also declare an interim dividend without the approval of our Shareholders. Future dividends will be paid by our Company as and when approved by our Shareholders (if necessary) and our Directors. Our Directors intend to recommend at least 30.0% of our net profit attributable to Shareholders in FY2013 and FY2014 as dividends, subject to the factors outlined above. However, investors should note that the intention to recommend the aforesaid dividends should not be treated as legal obligations on our Company nor should it be treated as an indication of our Company’s future dividend policy. In the event our Directors deem that it would be prudent to retain profits in our Group for its operations, especially when economic conditions are not favourable, a lower dividend or no dividend may be declared. The amount of dividends declared and paid by us in the past should not be taken as an indication of the dividends payable in the future. Investors should not make any inference from the foregoing statements as to our actual future profitability or our ability to pay any future dividends. For information relating to taxes payable on dividends, please refer to the section entitled “ Taxation ” as set out in Appendix D of this Offer Document.

47

SHARE CAPITAL
Our Company (company registration number 201311530Z) was incorporated in Singapore on 30 April 2013 under the Companies Act as a private limited company under the name of “PS Group Holdings Pte. Ltd.”. On 18 June 2013, our Company was converted into a public company limited by shares and the name of our Company was changed to “PS Group Holdings Ltd.”. As at the date of incorporation, our Company’s issued and paid-up share capital was S$1.00 comprising one Share. Pursuant to the completion of the Restructuring Exercise, the issued and paid-up share capital of our Company was increased to S$6,803,523 comprising 6,803,523 Shares. At an extraordinary general meeting held on 13 June 2013, our Shareholders approved, inter alia , the following: (a) (b) the Share Split; the conversion of our Company into a public company limited by shares and the consequential change of our name to “PS Group Holdings Ltd.”; the adoption of the new Articles; the listing and quotation of all the issued Shares (including the Placement Shares to be allotted and issued as part of the Placement), the Performance Shares and the Option Shares to be issued (if any) on Catalist; the issue and allotment of the Placement Shares which are the subject of the Placement, on the basis that the Placement Shares, when allotted, issued and fully paid-up, will rank pari passu in all respects with the existing issued and fully paid-up Shares; the authorisation for our Directors, pursuant to Section 161 of the Companies Act and the Listing Manual to (i) issue Shares whether by way of rights, bonus or otherwise; (ii) make or grant offers, agreements or options (collectively, “ Instruments ”) that might or would require Shares to be issued, including but not limited to the creation and issue of (as well as adjustments to) warrants, debentures or other instruments convertible into Shares, at any time and upon such terms and conditions and for such purposes and to such persons as our Directors may in their absolute discretion deem fit; and (iii) (notwithstanding the authority conferred by this resolution may have ceased to be in force) issue Shares in pursuance of any Instruments made or granted by our Directors while this resolution was in force, provided that: (1) the aggregate number of Shares (including Shares to be issued in pursuance of the Instruments, made or granted pursuant to this resolution) and Instruments to be issued pursuant to this resolution shall not exceed 100% of the total number of issued Shares (excluding treasury shares) in the capital of our Company (as calculated in accordance with sub-paragraph (2) below), of which the aggregate number of Shares to be issued (including Shares to be issued pursuant to the Instruments) other than on a pro rata basis to existing Shareholders shall not exceed 50% of the total number of issued Shares (excluding treasury shares) in the capital of our Company (as calculated in accordance with sub-paragraph (2) below);

(c) (d)

(e)

(f)

48

SHARE CAPITAL
(2) (subject to such calculation as may be prescribed by the SGX-ST) for the purpose of determining the aggregate number of Shares (including Shares to be issued pursuant to the Instruments) that may be issued under sub-paragraph (1) above, the percentage of Shares that may be issued shall be based on the total number of issued Shares of our Company (excluding treasury shares) immediately after the Placement, after adjusting for: (aa) new Shares arising from the conversion or exercise of the Instruments or any convertible securities; (bb) new Shares arising from exercising share options or vesting of share awards outstanding and subsisting at the time of the passing of this authority; and (cc) any subsequent bonus issue, consolidation or sub-division of Shares; in exercising such authority, our Company shall comply with the provisions of the Listing Manual for the time being in force (unless such compliance has been waived by the SGX-ST) and the Articles of Association for the time being of our Company; and unless revoked or varied by our Company in a general meeting, such authority shall continue in force until (aa) the conclusion of the next annual general meeting of our Company; or (bb) the date by which the next annual general meeting of our Company is required by law to be held, whichever is the earlier;

(3)

(4)

(g)

the adoption of the PSP, the rules of which are set out in Appendix E of this Offer Document and that our Directors be authorised to allot and issue Shares upon the release of Awards granted under the PSP; the participation in the PSP by Teo Choon Hock, Kwek Keng Seng and Teo Yong Tat; the adoption of the ESOS, the rules of which are set out in Appendix F of this Offer Document and that our Directors be authorised to allot and issue Option Shares upon the exercise of Options granted under the ESOS; the grant of Options at a discount under the ESOS; and the participation in the ESOS by Teo Choon Hock, Kwek Keng Seng and Teo Yong Tat.

(h) (i)

(j) (k)

As at the Latest Practicable Date, there is only one class of shares in the capital of our Company, being ordinary shares. A summary of the Articles of Association of our Company relating to, among others, the voting rights of our Shareholders is set out in the section entitled “ Summary of Selected Articles of Association of Our Company ” in Appendix C of this Offer Document. There are no founder, management, deferred or unissued Shares reserved for issuance for any purpose. Save for the ESOS, no person has been, or is entitled to be, given an option to subscribe for or purchase any securities of our Company or our subsidiary. No participant has been identified and/or granted an Award for any Performance Shares by the Remuneration Committee pursuant to the PS Group Holdings Performance Share Plan. As at the date of this Offer Document, the issued and paid-up share capital of our Company is S$6,803,523 divided into 47,600,000 Shares. Upon the allotment and issue of the Placement Shares which are the subject of the Placement, the resultant issued and paid-up share capital of our Company will be increased to S$11,415,678 comprising 68,000,000 Shares.

49

SHARE CAPITAL
Details of changes in the issued and paid-up capital of our Company since our incorporation and immediately after the Placement are as follows: Issued and paid-up capital (S$) 1 6,803,522

Number of Shares Issued and fully paid Shares as at our Company’s incorporation Issue of Shares pursuant to the Restructuring Exercise Resultant issued and fully paid Shares immediately after the Restructuring Exercise After the Share Split Placement Shares issued pursuant to the Placement Post-Placement issued and paid-up share capital
(1)

1 6,803,522

6,803,523 47,600,000 20,400,000 68,000,000

6,803,523 6,803,523 4,612,155 11,415,678

Note: (1) This takes into account estimated Placement expenses of S$608,000 to be charged directly to our combined statement of comprehensive income for FY2013.

Save as disclosed above and in the section entitled “ Restructuring Exercise ” of this Offer Document, there are no changes in the issued and paid-up share capital of our Company and our subsidiary within the last three years preceding the Latest Practicable Date.

50

SHAREHOLDERS
OWNERSHIP STRUCTURE Our Directors and Substantial Shareholders and their respective shareholdings in our Company immediately before and after the Placement are set out below:
Before the Placement After the Placement Direct interest Deemed interest Direct interest Deemed interest Number of Number of Number of Number of Shares % Shares % Shares % Shares % Directors Teo Choon Hock Kwek Keng Seng Ang Miah Khiang Tan Jee Ming Tan Chin Keong Public Total 26,179,904 21,420,096 – – – – 55.0 45.0 – – – – – – – – – – – – – – – – 26,179,904 38.5 21,420,096 31.5 – – − −(1) – – 20,400,000(1) 30.0 68,000,000 100.0 – – – – – – – – – – – –

47,600,000 100.0

Note: (1) As at the date of this Offer Document, our Independent Director, Tan Jee Ming, and Tsai Chao Chin, the general manager and shareholder of Fang Sheng, have indicated an interest to subscribe for 20,000 and 3,400,000 Placement Shares, respectively. In the event Tan Jee Ming and Tsai Chao Chin are each allotted such number of Placement Shares, he will own approximately 0.03% and 5.0% of our post-Placement share capital respectively, and Tsai Chao Chin will therefore become a Substantial Shareholder of our Company. Please refer to the section entitled “Plan of Distribution” of this Offer Document for more details of indicative interests to subscribe for Placement Shares that have been received by the Company.

The Shares held by our Directors and Substantial Shareholders do not carry different voting rights from the Placement Shares which are the subject of the Placement. Save as disclosed above, our Company is not, whether directly or indirectly, owned or controlled by another corporation, any government or other natural or legal person whether severally or jointly. Our Directors are not aware of any arrangement the operation of which may, at a subsequent date, result in a change in control of our Company. There has not been any public take-over offer by a third party in respect of our Shares or by our Company in respect of the shares of another corporation or units of a business trust which has occurred between 1 January 2012 and the Latest Practicable Date. Significant Changes in Percentage of Ownership Save as disclosed above and under the sections entitled “ Restructuring Exercise ” and “ Share Capital ” of this Offer Document, there were no significant changes in the percentages of ownership of our Directors and Substantial Shareholders in our Company from its incorporation until the Latest Practicable Date. MORATORIUM To demonstrate their commitment to our Group, our Controlling Shareholders, Teo Choon Hock and Kwek Keng Seng, who hold an aggregate of 47,600,000 Shares (representing 70.0% of our Company’s post-Placement share capital), have each undertaken not to, directly or indirectly, sell, contract to sell, offer, realise, transfer, assign, pledge, grant any option to purchase, grant any security over, encumber or otherwise dispose of, any part of their respective shareholdings in the share capital of our Company immediately after the Placement (adjusted for any bonus issue or sub-division of Shares) for a period of six months from the date of our Company’s admission to Catalist and for a period of six months thereafter, not to reduce their respective interests in our Company to below 50% of their original shareholdings in our Company. 51

DILUTION
Dilution is the amount by which the Placement Price paid by the subscribers of our Placement Shares (“ New Investors ”) exceeds our NAV per Share immediately after the Placement. Our audited NAV per Share as at 31 December 2012, before adjusting for the estimated net proceeds from the Placement and based on our Company’s pre-Placement share capital of 47,600,000 Shares, was 14.3 cents per Share. Taking into account the issue of 20,400,000 Placement Shares at the Placement Price in connection with the Placement and after deducting the estimated Placement expenses, our NAV per Share as at 31 December 2012 after adjusting for the estimated net proceeds from the Placement and based on our Company’s post-Placement share capital of 68,000,000 Shares, would have been 15.6 cents. This represents an immediate increase in the NAV per Share of 1.3 cents to our existing Shareholders and an immediate dilution in NAV per Share of 9.4 cents or approximately 37.6% to our New Investors. The following table illustrates such dilution on a per Share basis as at 31 December 2012: Cents Placement Price per Share Audited NAV per Share as at 31 December 2012 based on our Company’s pre-Placement share capital Increase in NAV per Share attributable to the Placement NAV per Share after the Placement (1) Dilution in NAV per Share to New Investors Dilution in NAV per Share to New Investors as a percentage of Placement Price 25.0 14.3 1.3 15.6 9.4

37.6%

Note: (1) The computed NAV does not take into account our actual financial performance from 1 January 2013 up to the Latest Practicable Date. Depending on our actual results, our NAV per Share after the Placement may be higher or lower than the computed NAV per Share.

The following table shows the average effective cost per Share paid by our existing Shareholders for Shares acquired by them (after adjusting for the Restructuring Exercise and the Share Split) during the period of three years prior to the date of lodgement of this Offer Document and the price per Share to be paid by our New Investors pursuant to the Placement: Number of Shares acquired (adjusted for the Restructuring Exercise and the Share Split) Teo Choon Hock Kwek Keng Seng New Investors 26,179,904 21,420,096 20,400,000 Average effective cost per Share (cents) 14.3 14.3 25.0

Total consideration (S$) 3,741,924 3,061,599 5,100,000

Save as disclosed above, none of our Directors or the Substantial Shareholders of our Company or their respective Associates have acquired any Shares during the period of three years prior to the date of lodgement of this Offer Document.

52

RESTRUCTURING EXERCISE
In connection with the Placement, we implemented the following reorganisation (the “ Restructuring Exercise ”) to streamline and rationalise our Group’s structure pursuant to which our Company became the investment holding company of our Group: 1. Incorporation of our Company Our Company was incorporated on 30 April 2013 in Singapore in accordance with the Companies Act as a private company limited by shares with an issued and paid-up share capital of S$1.00 comprising one Share held by Teo Choon Hock. 2. Acquisition of PS Fasteners Pursuant to a share swap agreement dated 30 May 2013 entered into between our Company, Teo Choon Hock and Kwek Keng Seng, our Company acquired from Teo Choon Hock and Kwek Keng Seng the entire issued and paid-up share capital of PS Fasteners held by them, comprising an aggregate of 400,016 ordinary shares for a total consideration of S$6,803,522 based on the audited NTA of PS Fasteners as at 31 December 2012. The purchase consideration was satisfied by the issue and allotment of an aggregate of 6,803,522 Shares in the capital of our Company (“ Consideration Shares ”), at an issue price of S$1.00 per Share, credited as fully paid-up and was arrived at on a willing buyer willing seller basis. The Consideration Shares were issued and allotted to Teo Choon Hock and Kwek Keng Seng in accordance with their shareholding percentage in PS Fasteners immediately prior to the acquisition. Please refer to the section entitled “ Group Structure ” of this Offer Document for details of our Group structure upon completion of the Restructuring Exercise.

53

GROUP STRUCTURE
Our Group structure after the Restructuring Exercise and as at the date of this Offer Document is as follows:

PS Group Holdings Ltd. 100% PS Fasteners Pte. Ltd.
The details of our subsidiary as at the date of this Offer Document are as follows: Date and country of incorporation 20 June 1991/ Singapore Effective equity interest held by our Group 100%

Name PS Fasteners Pte. Ltd.

Principal place of business Singapore

Principal activities Import and export of bolts, nuts, rivets, fasteners and screw machine products

Our subsidiary is not listed on any stock exchange. We do not have any Associated Companies.

54

SELECTED COMBINED FINANCIAL INFORMATION
The following selected combined financial information of our Group should be read in conjunction with the full text of this Offer Document, including the “ Audited Combined Financial Statements Of PS Group Holdings Ltd. And Its Subsidiary For The Financial Years Ended 31 December 2010, 2011 And 2012 ” as set out in Appendix A of this Offer Document and the section entitled “ Management’s Discussion and Analysis of Financial Position and Results of Operations ” of this Offer Document. Combined Statements of Comprehensive Income (1) < FY2010 S$’000 Revenue Cost of sales Gross profit Other income Expenses Selling and distribution expenses Administration expenses Finance expenses Profit before taxation Income tax expense Profit for the year Other comprehensive income for the year, net of tax Total comprehensive income for the year Profit for the year attributable to: Owners of the Company Basic EPS (cents) (2)(3) Adjusted EPS (cents)
Notes: (1) Please refer to the “Audited Combined Financial Statements Of PS Group Holdings Ltd. And Its Subsidiary For The Financial Years Ended 31 December 2010, 2011 And 2012” as set out in Appendix A to this Offer Document for the basis of preparation of the combined financial statements of our Group. For comparative purposes, EPS has been computed based on profit for the year and the pre-Placement share capital of 47,600,000 Shares. Had the Service Agreements (as disclosed in the section entitled “Service Agreements” of this Offer Document) and the Directors’ fees payable to the Executive Directors for FY2013 been in effect since 1 January 2012, the profit before income tax and profit for the year of our Group for FY2012 would have been approximately S$1.4 million and approximately S$1.1 million respectively, and the EPS based on the pre-Placement share capital of 47,600,000 Shares would have been 2.4 cents. For comparative purposes, adjusted EPS has been computed based on profit for the year and the post-Placement share capital of 68,000,000 Shares.
(4)

Audited FY2011 S$’000 12,502 (8,822) 3,680 63 (608) (1,626) (30) 1,479 (175) 1,304 – 1,304

> FY2012 S$’000 12,293 (8,318) 3,975 8 (720) (1,887) (46) 1,330 (238) 1,092 – 1,092

11,991 (8,208) 3,783 259 (551) (1,531) (48) 1,912 (243) 1,669 – 1,669

1,669 3.5 2.5

1,304 2.7 1.9

1,092 2.3 1.6

(2) (3)

(4)

55

SELECTED COMBINED FINANCIAL INFORMATION
Combined Balance Sheet (1) Audited as at 31 December 2012 S$’000 ASSETS Non-current assets Property, plant and equipment Current assets Inventories Trade and other receivables Prepayments Cash and cash equivalents 3,170

7,635 2,026 75 335 10,071

Total assets EQUITY AND LIABILITIES Current liabilities Trade and other payables Loans and borrowings Income tax payable

13,241

2,751 2,933 234 5,918

Net current assets Non-current liabilities Loans and borrowings Deferred tax liabilities

4,153

500 19 519

Total liabilities Net assets Equity attributable to owners of the Company Share capital Retained earnings Total equity Total equity and liabilities NAV per share (cents) (2)
Notes: (1)

6,437 6,804

400 6,404 6,804 13,241 14.3

Please refer to the “Audited Combined Financial Statements Of PS Group Holdings Ltd. And Its Subsidiary For The Financial Years Ended 31 December 2010, 2011 And 2012” as set out in Appendix A to this Offer Document for the basis of preparation of the combined financial statements of our Group. For comparative purposes, NAV per share has been computed based on the net asset value of our Group and our pre-Placement share capital of 47,600,000 Shares.

(2)

56

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS
The following discussion of our results of operations and financial position for the period under review should be read in conjunction with the “ Audited Combined Financial Statements Of PS Group Holdings Ltd. And Its Subsidiary For The Financial Years Ended 31 December 2010, 2011 And 2012 ” as set out in Appendix A of this Offer Document. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from those projected in the forward-looking statements. Factors that may cause future results to differ significantly from those projected in the forward-looking statements include, but are not limited to, those discussed below and elsewhere in this Offer Document, particularly in the section entitled “ Risk Factors ” of this Offer Document. Under no circumstances should the inclusion of such forward-looking statements herein be regarded as a representation, warranty or prediction with respect to the accuracy of the underlying assumptions by our Company, the Sponsor and Placement Agent or any other person. Investors are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof. Please refer to the section entitled “ Cautionary Note on Forward-Looking Statements ” of this Offer Document.

OVERVIEW We are a “Mix-And-Match Expert” for the supply of quality fasteners that provide our customers with the online convenience of placing their orders from anywhere, at anytime, of any mix and for any quantity for delivery on a timely basis. As at the Latest Practicable Date, we carry in excess of 15,000 different types and sizes of fastener products that we procure in bulk from fastener manufacturers and supply to our customers. Our products have diverse industrial applications in amongst others, infrastructure developments, structural fabrication and construction in civil works, transportation and manufacturing of heavy machinery, automotives and parts. Our marketing efforts are focused primarily in Southeast Asia as well as emerging markets such as South America. Please refer to the section entitled “ General Information on Our Group – Business Overview ” of this Offer Document for further details of our business. Revenue We derive our revenue from the supply of fastener products to distributors with retail networks who, in turn, sell the fastener products to industrial end-users from diverse industries. These products include screws, bolts, nuts, pins, anchors, rivets, washers and clips in a variety of materials such as stainless steel, alloy steel, carbon steel, mild steel, brass, nylon and aluminium as well as in a variety of platings. Revenue is recognised upon the transfer of significant risks and rewards of ownership of the products to our customers, usually on delivery of goods. Please refer to the section entitled “ General Information on Our Group – Business Overview ” of this Offer Document for further details of the products that we supply. As at the Latest Practicable Date, we have approximately 200 customers in more than 45 countries. Our sales to Indonesia, Malaysia and Singapore collectively accounted for approximately 70.3%, 67.7% and 68.0% of our revenue in FY2010, FY2011 and FY2012 respectively.

57

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS
An average of approximately 24.2% of our revenue over FY2010, FY2011 and FY2012 was denominated in US$, with the balance denominated in S$. Factors affecting our revenue Our revenue may be affected by, inter alia , the following factors: (a) our ability to retain the continued services of our Executive Chairman, Teo Choon Hock, and our Managing Director, Kwek Keng Seng, and other key personnel and our ability to identify, recruit, train and retain qualified management personnel in line with our growth; demand for our products and services which is largely affected by the state of industrial and infrastructure developments, and general economic conditions, in the countries we supply to, in particular, Singapore, Malaysia and Indonesia; the stability of the global financial markets; our ability to continually source for, in a cost effective and timely manner, the products that meet our customers’ requirements and specifications and which are free from defects; our ability to compete effectively in our industry with competitors as we generally compete on key attributes such as competitive pricing, good customer and delivery service and the quality of our products; and our ability to ensure the continuity of goods supplied to us, including our ability to maintain our long-term arrangements with several of our major suppliers.

(b)

(c) (d)

(e)

(f)

Please refer to the section entitled “ Risk Factors ” of this Offer Document for a more comprehensive discussion of other factors that may affect our business, results of operations and financial condition. Revenue by geographical area Our revenue by geographical breakdown is prepared based on the geographical location of our customers. The following table sets out a breakdown of revenue received from each of our geographical area: FY2010 S$’000 % Indonesia Malaysia Singapore Emerging Markets (1) Other countries (2) Total
Notes: (1) (2) Emerging Markets mainly comprise Sri Lanka, Panama, United Arab Emirates, Chile, Argentina, Thailand, Pakistan, and Venezuela. Other countries mainly comprise New Zealand, Australia, Japan, Israel and Canada.

FY2011 S$’000 % 3,585 2,870 2,001 2,880 1,166 12,502 28.7 23.0 16.0 23.0 9.3 100.0

FY2012 S$’000 % 3,055 3,094 2,203 2,859 1,082 12,293 24.9 25.2 17.9 23.2 8.8 100.0

3,366 3,099 1,970 2,323 1,233 11,991

28.1 25.8 16.4 19.4 10.3 100.0

58

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS
Cost of sales Our cost of sales comprises mainly purchases of fastener products from our suppliers. As our products are generally generic in nature, we select our suppliers based on their reputation, reliability, pricing, purchase terms and timeliness of delivery. We have established strong relationships with our suppliers, which in turn provides us with assurance of the continuity of our supplies including those of well established brands in the fastener industry such as YFS, THE, RECOIL and SFC. For the period under review, we purchased our products from fastener manufacturers located mainly in Taiwan, People’s Republic of China, Japan, Australia and India. Factors affecting our cost of sales Our cost of sales may be affected by, inter alia , the following key factors: (a) our ability to source for and purchase fastener products at competitive prices that meet our customers’ requirements; our ability to maintain our existing relationships with our suppliers; the price of raw materials, such as steel, brass and aluminium, used in the production of fastener products; our ability to manage the costs related to maintaining our inventory range and holding our inventory level, such as financing costs, warehousing and logistics costs and insurance costs, as we seek to expand our business and meet the product requirements of our customers; and the exchange rate between US$ against S$.

(b) (c)

(d)

(e)

As a substantial amount of our purchases are denominated in foreign currencies, particularly US$, and since our functional currency is S$, any fluctuation in the relevant exchange rates will have an impact on our purchases. In FY2010, FY2011 and FY2012, our purchases denominated in US$ accounted for approximately 92.5%, 92.3% and 89.1% of our total purchases respectively. Please refer to the section entitled “ Risk Factors ” of this Offer Document for a more comprehensive discussion of other factors which may affect our business, results of operations and financial condition. Gross profit Gross profit and gross profit margin for each of FY2010, FY2011 and FY2012 are as set out below: FY2010 Gross profit (S$’000) Gross profit margin (%) 3,783 31.5 FY2011 3,680 29.4 FY2012 3,975 32.3

59

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS
Other income Our other income comprises mainly reversal of impairment losses on our leasehold properties at 3 Kaki Bukit Road 2, #01-06/07 Eunos Warehouse Complex Singapore 417837 and government grants and credits received under the Internationalisation Capability Development Program and SME Cash Grant. Our leasehold properties are accounted for on a cost-model basis, with an impairment assessment carried out annually. In line with the general improvement in Singapore’s industrial property prices during the period under review, we recorded the reversals of impairment losses on our leasehold properties amounting to S$182,000 and S$62,000 in FY2010 and FY2011, respectively. The Internationalisation Capability Development Program is a one-off tax-exempt government grant program introduced by IE Singapore in 2009 to upgrade the competitiveness of local enterprises. The SME Cash Grant is a one-off non-taxable cash grant introduced by the Singapore government in 2012 to help companies offset the high operating costs which may persist in the business slowdown. Other income amounted to approximately S$259,000, S$63,000 and S$8,000 in FY2010, FY2011, and FY2012, respectively. Selling and distribution expenses Selling and distribution expenses comprise mainly remuneration of personnel engaged in distribution and marketing, travelling expenses in relation to sales and marketing activities, advertising and promotional costs and freight expenses. Selling and distribution expenses amounted to approximately S$551,000, S$608,000 and S$720,000, and accounted for approximately 4.6%, 4.9%, and 5.9% of our revenue for FY2010, FY2011 and FY2012, respectively. Administration expenses Administration expenses comprise mainly directors’ fees and remuneration, insurance expenses, depreciation charges, warehouse maintenance fees, professional fees, Placement expenses and general office expenditure. Administration expenses amounted to approximately S$1.5 million, S$1.6 million and S$1.9 million, and accounted for approximately 12.8%, 13.0%, and 15.4% of our revenue for FY2010, FY2011 and FY2012, respectively. Finance expenses Finance expenses relate to interest incurred on bank borrowings, and on trust receipts facilities drawn down from banks. Finance expenses amounted to approximately S$48,000, S$30,000 and S$46,000, and accounted for approximately 0.4%, 0.2%, and 0.4% of our revenue for FY2010, FY2011 and FY2012, respectively. Income tax expense We are subject to income tax at the applicable statutory tax rate in Singapore, which was 17.0% during the period under review. Our effective tax rate was 12.7%, 11.8% and 17.9% in FY2010, FY2011 and FY2012, respectively. In FY2010 and FY2011, the effective tax rates were lower than the statutory rate mainly due to the one-off tax-exempt cash grant received in FY2010 arising from the Internationalisation Capability Development Program and tax credits received in FY2011 from the Productivity Innovation Credit Scheme (“ PICS ”). The PICS was introduced by IRAS in 2010 and allowed for enhanced tax

60

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS
deductions for qualifying expenses, such as the upgrading of IT infrastructure undertaken by our Group. In FY2012, the effective tax rate was marginally higher than the statutory tax rate as a result of professional fees arising from the preparation for the Placement which are non-tax deductible.

REVIEW OF RESULTS OF OPERATIONS FY2011 compared to FY2010 Revenue Our revenue increased by approximately S$511,000 or 4.3% from S$12.0 million in FY2010 to S$12.5 million in FY2011 due mainly to an increase in sales to our customers in Emerging Markets, in particular, our customers in Sri Lanka and Argentina. Gross profit and gross profit margin Gross profit decreased by approximately S$103,000 or 2.7% from S$3.8 million in FY2010 to S$3.7 million in FY2011. The corresponding gross profit margin decreased from approximately 31.5% in FY2010 to approximately 29.4% in FY2011. The decrease in our gross profit and gross profit margin in FY2011 compared to FY2010 was due to: (a) the higher cost of purchases in line with the higher cost of raw materials such as steel, for which we were not able to fully pass on the increased costs to our customers; and the bulk discounts that we provided to several of our customers who had placed larger orders with us compared to the previous financial year.

(b)

Other income Other income decreased by approximately S$196,000 from S$259,000 in FY2010 to S$63,000 in FY2011 mainly due to a lower reversal of impairment loss on our leasehold properties of approximately S$62,000 in FY2011 versus S$182,000 in FY2010 as well as the absence of S$70,000 in one-off tax-exempt government grant under the Internationalisation Capability Development Program that was received in FY2010 to develop our Group’s branding. The reversal of impairment losses on our leasehold properties in FY2011 was in line with the general increase in Singapore’s industrial property prices. However, the amount was lower than that for FY2010 and was limited to S$62,000 as this represented the full reversal of accumulated impairment losses on our leasehold properties, which are to be reflected at the lower of cost or net carrying value in accordance with our Group’s accounting policy. Selling and distribution expenses Selling and distribution expenses increased by approximately 10.3% or S$57,000 from S$551,000 in FY2010 to S$608,000 in FY2011 mainly due to the increase in the number of sales and warehouse staff to support the increase in our business activities.

61

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS
Administration expenses Administration expenses increased by approximately S$95,000 or 6.2% from S$1.5 million in FY2010 to S$1.6 million in FY2011 mainly due to additional depreciation charges arising from the upgrading of our IT infrastructure to enhance the tracking and management of our increasingly wide product range. Finance expenses Finance expenses decreased by approximately S$18,000 from S$48,000 in FY2010 to S$30,000 in FY2011 due to the lower interest expense incurred on our bank loans and trust receipts. Interest expense incurred on our bank loans was lower in FY2011 because of the repayment of S$410,000 in bank loans. Interest expense incurred on our trust receipts was lower in FY2011 as we drew down a lower amount of our trust receipts facilities during the financial year to finance our inventory purchases. Profit before taxation As a result of the foregoing, profit before taxation decreased by approximately S$433,000 or 22.6% from S$1.9 million in FY2010 to S$1.5 million in FY2011. FY2012 compared to FY2011 Revenue Our revenue decreased by approximately S$209,000 or 1.7% from S$12.5 million in FY2011 to S$12.3 million in FY2012 due mainly to a decline in sales of approximately S$635,000 to our customers in Indonesia, Emerging Markets and other countries, which was offset by an increase in sales of approximately S$426,000 to our customers in Singapore and Malaysia. Gross profit and gross profit margin Gross profit increased by approximately S$295,000 or 8.0% from S$3.7 million in FY2011 to S$4.0 million in FY2012. The corresponding gross profit margin increased from approximately 29.4% in FY2011 to approximately 32.3% in FY2012. The increase in our gross profit and gross profit margin in FY2012 compared to FY2011 was due to a decrease in our cost of purchases of fastener products in line with the general slowdown in the global economy. Other income Other income decreased by approximately S$55,000 from S$63,000 in FY2011 to S$8,000 in FY2012 mainly due to the absence of any reversal of impairment loss on leasehold properties which was offset by the receipt of a one-off non-taxable SME Cash Grant of S$5,000. In FY2012, there was no reversal of impairment loss on leasehold properties notwithstanding a general increase in Singapore’s industrial property prices as all the accumulated impairment losses had been fully reversed in FY2011.

62

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS
Selling and distribution expenses Selling and distribution expenses increased by approximately 18.4% or S$112,000 from S$608,000 in FY2011 to S$720,000 in FY2012 due to the increase in sales staff to support the increase in our business activities, as well as the full-year effect of the sales and warehouse staff that joined us over the course of FY2011. Administration expenses Administration expenses increased by approximately S$261,000 from S$1.6 million in FY2011 to S$1.9 million in FY2012 mainly due to the increase in professional fees of approximately S$173,000 arising from the preparation for the Placement. In addition, we increased the number of our finance and administration staff to support the actual and anticipated increase in our business activities. Finance expenses Finance expenses increased by approximately S$16,000 from S$30,000 in FY2011 to S$46,000 in FY2012 mainly attributable to an increase of interest expense incurred on trust receipts due to a higher amount of our trust receipts facilities drawn down during the financial year to finance our inventory purchases. Profit before taxation As a result of the foregoing, profit before taxation decreased by approximately S$149,000 or 10.1% from S$1.5 million in FY2011 to S$1.3 million in FY2012.

REVIEW OF FINANCIAL POSITION Current assets Our current assets comprise inventories, trade and other receivables, prepayments and cash and cash equivalents. As at 31 December 2012, our current assets amounted to approximately S$10.1 million, representing approximately 76.1% of our total assets. The largest component of our current assets, inventories, amounted to approximately S$7.6 million, representing 75.8% of our current assets. Inventories comprise fastener products such as screws, bolts, nuts, pins, anchors, rivets, washers and clips. Trade and other receivables amounted to approximately S$2.0 million, representing approximately 20.1% of our current assets. Other receivables are mainly made up of GST receivables. Cash and cash equivalents was approximately S$335,000 while the remaining balance of approximately S$75,000 related to prepayments, mainly for professional fees made in relation to the Placement.

63

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS
Non-current assets Our non-current assets comprise property, plant and equipment which include our leasehold properties at 3 Kaki Bukit Road 2, #01-06/07 Eunos Warehouse Complex, Singapore 417837 and related improvements, motor vehicles, tools and equipment, office equipment, furniture and fittings, and computer equipment. As at 31 December 2012, our non-current assets amounted to approximately S$3.2 million, representing approximately 23.9% of our total assets. Current liabilities Our current liabilities comprise trade and other payables, current portion of loans and borrowings and income tax payable. As at 31 December 2012, our current liabilities amounted to approximately S$5.9 million, representing approximately 91.9% of our total liabilities. The current portion of our loans and borrowings amounted to approximately S$2.9 million or 49.6% of our current liabilities while trade and other payables amounted to approximately S$2.8 million, representing 46.5% of our current liabilities. Other payables comprise mainly trust receipts facilities utilised, and accrued operating expenses comprising mainly payables in relation to employee salary-related expenses, directors’ fees for our Executive Directors, and Placement expenses incurred. Our income tax payable amounted to approximately S$234,000 or 4.0% of our current liabilities. Non-current liabilities Our non-current liabilities comprise long term loans and borrowings and deferred tax liabilities. As at 31 December 2012, our non-current liabilities amounted to approximately S$519,000, representing approximately 8.1% of our total liabilities. This comprised mainly loans and borrowings of approximately S$500,000 representing 96.3% of our non-current liabilities. The balance of our non-current liabilities comprised our deferred tax liabilities of approximately S$19,000. Equity attributable to owners of the Company Equity attributable to owners of the Company comprises share capital and retained earnings. As at 31 December 2012, equity attributable to owners of the Company amounted to approximately S$6.8 million.

LIQUIDITY AND CAPITAL RESOURCES During the period under review and up to the Latest Practicable Date, we financed our working capital, capital expenditure and other capital requirements through a combination of funds generated from our operating activities, shareholders’ equity, loans from our Directors and bank and other borrowings. Please refer to the section entitled “ Capitalisation and Indebtedness ” of this Offer Document for further details of our borrowings as at the Latest Practicable Date as well as the section entitled “ Interested Person Transactions – Past Interested Person Transactions ” and Note 16 of the “ Audited Combined Financial Statements Of PS Group Holdings Ltd. And Its Subsidiary For The Financial Years Ended 31 December 2010, 2011 And 2012 ” as set out in Appendix A of this Offer Document for further details of the loans from our Directors. 64

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS
As at the Latest Practicable Date, we have cash and cash equivalents of approximately S$958,000, net current assets of S$5.5 million and credit facilities of S$4.8 million and US$250,000 which have not been utilised. Our Directors are of the opinion that, after taking into account the cash flows generated from our operations, our available credit facilities, and our existing cash and cash equivalents, the working capital available to our Group as at the date of lodgement of this Offer Document is sufficient for our present requirements and for at least 12 months after the listing of our Company on Catalist. The Sponsor is of the reasonable opinion that, having regard to the above, after having made due and careful enquiry and after taking into account the cash flows generated from our Group’s operations, our Group’s available credit facilities, and our Group’s existing cash and cash equivalents, the working capital available to our Group as at the date of lodgement of this Offer Document is sufficient for our present requirements and for at least 12 months after the listing of our Company on Catalist. A summary of our cash flows for FY2010, FY2011 and FY2012 is set out as follows: FY2010 S$’000 Net cash flows from/(used in) operating activities Net cash used in investing activities Net cash flows used in financing activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at 1 January Cash and cash equivalents at 31 December 1,543 (86) (1,134) FY2011 S$’000 (52) (131) (468) FY2012 S$’000 543 (100) (300)

323 520 843

(651) 843 192

143 192 335

An analysis of our cashflows for each of FY2010, FY2011 and FY2012 is set out below: Net cash flows from/(used in) operating activities FY2010 In FY2010, we generated net cash flow from operating activities of approximately S$1.5 million which mainly consisted of operating cash flows before working capital changes of S$1.9 million, net working capital outflow of S$204,000, and income tax paid of S$187,000. The net working capital outflow arose mainly from an increase in inventories of approximately S$522,000 in line with our strategy of keeping a ready inventory of products to meet the immediate demands of our customers, which was partly offset by: (a) a decrease in trade and other receivables, and prepayments, of approximately S$162,000 due mainly to a general increase in sales to customers with whom we normally transact on cash terms; and

65

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS
(b) an increase in trade and other payables of approximately S$156,000 due to a large purchase order made with a supplier that had remained outstanding at year-end within the credit terms extended to us.

FY2011 In FY2011, net cash flow used in operating activities was approximately S$52,000, which consisted mainly of operating cash flows before working capital changes of S$1.7 million, net working capital outflow of S$1.5 million, and income tax paid of S$247,000. The net working capital outflow arose mainly from the following: (a) an increase in inventories of approximately S$1.1 million as we expanded the range and quantity of products in line with our strategy of being better able to meet the immediate demands of our customers; an increase in trade and other receivables, and prepayments, of approximately S$274,000 arising from higher sales made on credit terms in December 2011; and a decrease in trade and other payables of approximately S$95,000 due mainly to the absence of the effect of the large purchase order made with a supplier that had remained outstanding at year-end in FY2010.

(b)

(c)

FY2012 In FY2012, we generated net cash flow from operating activities of approximately S$543,000 which consisted mainly of operating cash flows before working capital changes of S$1.5 million, net working capital outflow of S$804,000, and income tax paid of S$174,000. The net working capital outflow arose mainly from an increase in inventories of approximately S$1.4 million as we continued to increase the range and quantity of our inventories in anticipation of market demand, which was partly offset by: (a) a decrease in trade and other receivables, and prepayments, of approximately S$118,000 mainly due to a fall in sales on credit terms at year-end; and an increase in trade and other payables of approximately S$438,000 mainly due to an increase in professional fees payable in relation to the Placement and audit services and a longer average trade payable turnover days of 82 in FY2012 compared with 65 in FY2011.

(b)

Net cash flows used in investing activities FY2010 Net cash flow used in investing activities amounted to approximately S$86,000 in FY2010 mainly due to the acquisition of logistical equipment used in managing our inventory.

66

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS
FY2011 Net cash flow used in investing activities amounted to approximately S$131,000 in FY2011 mainly due to the upgrading of our IT infrastructure to enhance the tracking and management of our increasingly wide product range. FY2012 Net cash flow used in investing activities amounted to approximately S$101,000 in FY2012 mainly due to the improvement works made to our office to accommodate the increase in our sales and finance teams including additional furniture and fittings, leasehold improvements, new office and computer equipment and additional logistical equipment to improve our inventory management efficiency. Net cash flows used in financing activities FY2010 Net cash flows used in financing activities amounted to approximately S$1.1 million in FY2010. This was mainly due to: (a) (b) repayment of bank loans of approximately S$228,000; and payment of dividends amounting to approximately S$800,000.

FY2011 Net cash flows used in financing activities amounted to approximately S$468,000 in FY2011. This was mainly due to: (a) (b) repayment of bank loans of approximately S$410,000; and payment of dividends amounting to approximately S$800,000,

which was partially offset by a net drawdown of our trust receipts facilities amounting to approximately S$772,000 for the purchase of inventory to increase our product range. FY2012 Net cash flows used in financing activities amounted to approximately S$300,000 in FY2012. This was mainly due to: (a) (b) (c) the net repayment of trust receipts facilities of approximately S$287,000; repayment of bank loans of approximately S$167,000; and payment of dividends amounting to approximately S$800,000,

which was partially offset by new bank borrowings of S$1.0 million for working capital purposes.

67

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS
CAPITAL EXPENDITURE AND COMMITMENTS Capital expenditure and divestments Our major capital expenditure and divestments in each of FY2010, FY2011, FY2012, and for the period from 1 January 2013 up to the Latest Practicable Date are set out below: From 1 January 2013 to the Latest Practicable Date S$’000 – – – – – –

FY2010 S$’000 Expenditure
(1)

FY2011 S$’000 – 2 12 n.m. 117 131

FY2012 S$’000 11 35 2 36 17 101

Leasehold improvements Tools and equipment Office equipment Furniture and fittings Computer Total

– 73 2 – 13 88

FY2010 S$’000 Divestments
(2)

FY2011 S$’000 – 2 11 13 84 110

FY2012 S$’000 20 2 9 14 15 60

From 1 January 2013 to the Latest Practicable Date S$’000 – – – – – –

Leasehold improvements Tools and equipment Office equipment Furniture and fittings Computer Total

– 18 – – – 18

Notes: (1) (2) This relates to the cost of property, plant and equipment acquired for each financial year over the period under review and from 1 January 2013 to the Latest Practicable Date. This relates to the cost of property, plant and equipment disposed of/written-off for each financial year over the period under review and from 1 January 2013 to the Latest Practicable Date.

68

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS
FY2010 In FY2010, our Group incurred a total of S$88,000 in capital expenditure. Of the S$88,000, S$73,000 was spent to acquire logistical equipment used in managing our inventory. Our Group also acquired computer equipment and software which amounted to S$13,000. In FY2010, our divestments arose from the disposal of obsolete logistical equipment for managing our inventory which was replaced by the new purchases made. FY2011 In FY2011, our Group incurred a total of S$131,000 in capital expenditure. This was mainly due to an investment of S$117,000 on upgrading our IT infrastructure to enhance the tracking and management of our increasingly wide range of products. In FY2011, our divestments mainly comprise the write-off of computer equipment that was replaced as part of the IT infrastructure upgrading, as well as the write-off and disposals of office equipment and furniture and fittings that were deemed to be no longer useful. FY2012 In FY2012, our Group incurred a total of S$101,000 in capital expenditure. This was mainly due to improvement works made to our office space to accommodate the increase in our sales and finance teams, comprising S$36,000 in additional furniture and fittings, S$17,000 to replace obsolete computer equipment and S$13,000 in leasehold equipment and office equipment. Further, we spent approximately S$35,000 on additional logistical equipment to improve our inventory management efficiency. In FY2012, our divestments mainly comprise the write-off of leasehold improvements of S$20,000 and furniture and fittings of S$14,000 that were deemed to be no longer useful after the renovations, as well as the write-off of obsolete office and computer equipment of S$24,000 in total. Capital commitments As at the Latest Practicable Date, we do not have any material capital commitments. Operating lease commitments As at the Latest Practicable Date, we do not have any operating lease commitments.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS
FOREIGN EXCHANGE MANAGEMENT Our reporting currency is in S$. While our operations are primarily carried out in Singapore, our sales and purchases of inventories are largely denominated and transacted in S$ and US$. For FY2010, FY2011 and FY2012, the percentage of revenue and purchases of inventories denominated in the various currencies, are as set out below: FY2010 % of revenue denominated in S$ US$ 77.4 22.6 100.0 % of purchases denominated in S$ US$ Japanese Yen Others 2.5 92.5 1.0 4.0 100.0 2.7 92.3 1.8 3.2 100.0 2.3 89.1 5.2 3.4 100.0 75.7 24.3 100.0 74.4 25.6 100.0 FY2011 FY2012

To the extent that our revenue and purchases are not perfectly matched in the same currency and there are timing differences between the invoicing of our customers and the payment to our suppliers, we will be exposed to foreign exchange fluctuations against our functional and reporting currency in S$ which may adversely affect our results of operations. Currently, we do not have a formal foreign currency hedging policy with respect to our foreign exchange exposure. As at the date of this Offer Document, we have not used any financial hedging instruments to manage our foreign exchange risk. We will continue to monitor our foreign exchange exposure and may employ hedging instruments to manage our foreign exchange exposure should the need arise in the future. If necessary, we will seek the approval of our Board on the policy for entering into any foreign exchange hedging transactions and will put in place adequate procedures which will be reviewed and approved by our Audit Committee. Our net foreign exchange gains/(losses) for each of FY2010, FY2011 and FY2012 are as follows: FY2010 S$’000 Net foreign exchange gains/(losses) (17) FY2011 S$’000 4 FY2012 S$’000 (38)

Over the period under review, the net foreign exchange gains/(losses) were not material in the context of our profit before taxation and profit for the respective year.

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SEASONALITY We generally do not experience any significant seasonality patterns in our operations and business.

INFLATION During the period under review, inflation did not have a material impact on our financial performance. Please also refer to the section entitled “ General Information on Our Group – Prospects and Trends ” of this Offer Document.

CONTINGENT LIABILITIES As at the Latest Practicable Date, we are not aware of any material contingent liabilities which may have a material effect on the financial position and profitability of our Group.

CHANGES IN ACCOUNTING POLICIES Save as disclosed in the “ Audited Combined Financial Statements Of PS Group Holdings Ltd. And Its Subsidiary For The Financial Years Ended 31 December 2010, 2011 And 2012 ” as set out in Appendix A of this Offer Document, we have not made any significant changes in our accounting policies during the period under review.

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HISTORY Our Company was incorporated on 30 April 2013 in Singapore under the Companies Act as an investment holding private limited company under the name of “PS Group Holdings Pte. Ltd.”. In preparation for the Placement, we undertook the Restructuring Exercise so that PS Fasteners became the wholly-owned subsidiary of our Company. Our Company was converted into a public company and renamed as “PS Group Holdings Ltd.” on 18 June 2013. We are a “Mix-And-Match Expert” for the supply of quality fasteners such as screws, bolts, nuts, pins, anchors, rivets, washers and clips. Our history dates back to 1982 when Teo Choon Hock and Kwek Keng Seng, together with two unrelated partners, established a partnership in Singapore under the name of “Pan Sun Hardware Company” as a wholesale distributor of general hardware including fasteners in Singapore. As Pan Sun’s business expanded, it ventured into the import/export market and started distributing fastener products for brands such as YFS, THE, RECOIL and SFC. A decision was subsequently made by Teo Choon Hock, Kwek Keng Seng and their partners to incorporate PS Fasteners in Singapore on 20 June 1991 with a view that PS Fasteners would, as part of a rationalisation exercise, eventually assume Pan Sun’s import/export business while Pan Sun would continue to focus on the domestic market in Singapore. In 1992, Pan Sun was converted into a private limited company named “Pan Sun Hardware Pte. Ltd.”. Although PS Fasteners was incorporated in 1991, it remained dormant and it was only in 1994 that PS Fasteners assumed Pan Sun’s import/export business thereby taking over Pan Sun’s distributorship of fastener products with a focus on the Southeast Asia markets. In the same year, we relocated from our premises at King George’s Avenue that we had shared with Pan Sun, to a larger premise at 209 Ubi Avenue 4, Intrepid Warehouse Complex which had an area of 800 sq m. In 1997, as our business expanded, we relocated to 3 Kaki Bukit Road 2, #01-06 Eunos Warehouse Complex which had an area of 1,344 sq m for use as our office and warehouse. In the late 1990s, we launched an internet website with information of our range of products that allowed customers to place their orders with us online. This enabled us to have a more extensive reach and to expand our export operations beyond Southeast Asia. In 1998, as part of our endeavour to improve our quality management processes, we obtained certification from Quality Certification Limited for ISO 9002:94. In 2001, our ISO certification for our quality management system was updated to ISO 9002 by Moody International Certification Limited and subsequently to ISO 9001 (2000 Revision) in 2003 and ISO 9001:2008 in 2011. In 2001, PS Fasteners acquired 3 Kaki Bukit Road 2, #01-06 Eunos Warehouse Complex from Pan Sun. In 2002, a share swap was carried out amongst the four partners resulting in PS Fasteners becoming wholly-owned by Teo Choon Hock and Kwek Keng Seng, and Pan Sun being wholly-owned by the other two partners. In the same year, PS Fasteners also acquired a neighbouring unit at 3 Kaki Bukit Road 2, #01-07 Eunos Warehouse Complex, thereby adding an additional 672 sq m of warehouse space. In 2007, in recognition of Fang Sheng’s long-standing relationship with PS Fasteners, Fang Sheng presented an award to PS Fasteners as Fang Sheng’s first export customer for its YFS range of products. In 2009, as part of our marketing efforts, PS Fasteners branded itself as “The Mix-And-Match Expert”. This brand position was adopted to highlight our ability to offer our customers any mix of our products for any quantity so as to allow our customers to enjoy competitive pricing. 72

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In 2011, we put in place an online IT infrastructure which enabled us to have a faster turnaround time in processing our customers’ orders. In 2012, we were awarded the Top 100 Singapore Excellence Award 2011/2012 and the Singapore Brands Award 2012/2013 in recognition of our excellence in business. To date, we are the sole distributor for Fang Sheng’s YFS products to Singapore, Malaysia, Indonesia, Sri Lanka, Cambodia and Myanmar and the non-exclusive agent for Tong Hwei’s THE products in Singapore. Since PS Fasteners commenced operations in 1994, we have grown to become a supplier of over 15,000 different types and sizes of fasteners with approximately 200 customers in more than 45 countries as at the Latest Practicable Date.

BUSINESS OVERVIEW Fasteners are basic hardware devices with a wide spectrum of commercial and industrial applications used in, amongst others, manufacturing of automotives and parts, aircraft, appliances, machinery, construction and infrastructure. They can be produced using various materials such as stainless steel, alloy steel, carbon steel, brass, nylon and aluminium as well as to various lengths, widths, shapes and specifications for different usage. Depending on the intended application, fasteners may also undergo further processing to achieve different platings such as zinc, nickel, brass, chrome and black oxide. The type is driven by the end-use requirement or specification of the fastener, such as strength, resistance to corrosion, reusability, and many other factors. A fastener manufacturer will typically focus its manufacturing on limited types of fasteners and will sell its manufactured fasteners in large quantities through fastener distributors who will undertake the necessary marketing and logistics arrangements for distribution of the fasteners. Most industrial end-users of fasteners typically purchase a large variety of fasteners in relatively smaller quantities according to their usage and requirements and require deliveries to be made on a just-in-time basis. Due to their diversified usage patterns, the needs of industrial end-users are usually not met by a single fastener manufacturer. In addition, industrial end-users usually do not meet the minimum order quantities required by fastener manufacturers. Consequently, fastener manufacturers do not usually sell direct to industrial end-users unless their minimum order quantity is satisfied. Fastener distributors act as intermediaries by purchasing fasteners from fastener manufacturers in large quantities for resale in smaller quantities to industrial end-users. This helps to bridge the time lag between the manufacturers’ production lead times and customers’ tight delivery schedules. As fastener distributors maintain a consistent supply of fasteners of various specifications, they are able to offer their customers readily available inventory, reliable and prompt delivery service and flexible order size. Some smaller distributors specialize along industry lines because of the uniqueness of customer requirements, while others provide a wide range of fasteners used for general assembly. Larger distributors generally provide a wide range of fasteners as well as meet certain specialized industry needs, such as that of the aerospace industry. Depending on the minimum order quantities required by the fastener manufacturer, smaller distributors who are unable to meet such minimum order quantities may also purchase their supply of fasteners from larger distributors who are able to meet the required minimum order quantities.

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Our Business We are a “Mix-And-Match Expert” for the supply of quality fasteners that provide our customers with the online convenience of placing their orders from anywhere, at anytime, of any mix and for any quantity for delivery on a timely basis. We are dedicated to meeting our customers’ requests and carry as at the Latest Practicable Date, in excess of 15,000 different types and sizes of fasteners including screws, bolts, nuts, pins, anchors, rivets, washers and clips in a variety of materials such as stainless steel, alloy steel, carbon steel, mild steel, brass, nylon and aluminium as well as a variety of platings that we can pack and arrange for shipment to anywhere in the world at relatively short notice. Our products have diverse industrial applications in amongst others, infrastructure developments, structural fabrication and construction in civil works, transportation and manufacturing of heavy machinery, automotives and parts which we supply as at the Latest Practicable Date, to approximately 200 customers in more than 45 countries. We believe that this diversity provides a certain sustainability in our business and lends greater stability to our performance. We procure a wide variety of fasteners in bulk from fastener manufacturers and supply them to distributors with retail networks who, in turn, sell the fasteners to end-users. We have established good business relationships with internationally known fastener manufacturers such as Fang Sheng, Tong Hwei, AFS and Shanghai Prime, and have been supplying their brands of fastener products, such as YFS, THE, RECOIL and SFC for over 20 years. Our marketing efforts are focused on distributors with retail networks primarily in Southeast Asia as well as in emerging markets such as South America. Over the last three financial years ended 31 December 2012, approximately 24.7% and 27.2% of our revenue was derived from sales to Malaysia and Indonesia respectively. Please refer to the section entitled “ Management’s Discussion and Analysis of Financial Position and Results of Operations ” of this Offer Document for a breakdown of our revenue by geographical region. Business Process

Customer enquiries

Sales confirmation

Packing of order

Invoice and payment

Delivery

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We typically receive order enquiries from our customers through our internet website, facsimile or by email. Following receipt of the order enquiry, our sales and marketing team will send a sales quotation to the customer. Upon confirmation of the order by the customer, a list of the products ordered will be generated by our online IT system and sent to our warehouse team for packing. As the orders we receive are generally large and consist of a variety of products, all our final cargo packages will be inspected and checked by both our warehouse supervisor and sales personnel before an invoice is sent to the customer. Unless credit terms are extended to the customer, we will arrange for the delivery of the cargo to the customer only upon payment of the invoice. Credit terms ranging from 30 days to 60 days may be extended to certain customers on a case-by-case basis.

INVENTORY MANAGEMENT To maximise inventory turnover while ensuring that we have the necessary range of inventory to meet our customers’ needs, we have in place a computerised inventory management system that allows us to track our inventory movements and levels as well as our customers’ purchasing patterns. As part of our working capital management, we review the various inventory movements on a regular basis. Purchasing decisions are made having regard to the above information as well as indications of near term requirements of our customers. Purchase orders to replenish inventory are approved by the respective authorised personnel according to their authority limits. Our inventory is stored in our warehouse at 3 Kaki Bukit Road 2, #01-06/07 Eunos Warehouse Complex, Singapore 417837. Our procurement strategy is to maintain an extensive range of product items in sufficient quantities so that we have at any time readily available inventory to meet our customers’ purchase requirements and provide on-time delivery. Our inventory turnover days for the last three financial years ended 31 December 2012 are as follows: FY2010 Inventory turnover days
Note: (1) Inventory turnover days is equivalent to average inventory balance divided by cost of sales multiplied by 365 days.
(1)

FY2011 236

FY2012 305

217

We had intentionally increased our inventory levels (in terms of quantity and product range) gradually from FY2010 to FY2012 in line with our strategy of keeping a ready inventory so that we could be better able to meet the immediate demands of our customers, and this had resulted in the corresponding increase in our average inventory turnover days over the period under review. We conduct periodic physical counts of our product items at our warehouse throughout the financial year. This ensures accuracy of the information captured in our inventory management system and allows us to address any discrepancies in our inventory records. Through regular contact with our customers, our sales team understands the industries in which our customers operate, emerging industrial trends affecting their product requirements and their latest business activities. Based on this industry knowledge, we are able to assess the products that our customers require and place advance orders with our suppliers accordingly. Our inventory is measured at the lower of cost or net realisable value. Given the nature of our products, our inventory does not have a definite shelf life although incidents of slow moving inventory are possible. We have not experienced any write-down nor made any provisions in stock

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value for slow moving inventory in the last three financial years ended 31 December 2012. As at the Latest Practicable Date, our Directors are not aware of any information or reason to believe that our Group may have to make any material provisions for or write-down of our inventory.

SALES AND MARKETING Our sales and marketing efforts are focused mainly on promoting public awareness of the various brands that we carry. Our Directors believe that an effective marketing strategy is a key component of our success. Our sales and marketing team is headed by our Managing Director, Kwek Keng Seng. We reach out to our existing and potential customers by utilising marketing channels such as our internet website, online business-to-business platforms, industry magazines and business directories as well as by participating in trade fairs to promote our products. Our sales and marketing team has, over the years, established good long-term business relations with many of our customers, and they and our potential customers are encouraged to visit us to acquaint themselves with our management, and to view our inventory and product range. We also maintain frequent contact with our customers to better understand the market trends and their product demands and requirements. In line with our focus on emerging markets such as Southeast Asia and South America, our marketing efforts are mainly directed at distributors with retail networks primarily in Southeast Asia as well as in emerging markets such as South America.

QUALITY ASSURANCE We are committed to supplying quality fastener products to our customers. Our quality management system ensures that the fastener products we supply meet our customers’ requirements and minimise the risk of any products being rejected or returned by our customers. Our quality management system was ISO 9002:94 certified in 1998 and the certification was upgraded to ISO 9002 in 2001 and subsequently to ISO 9001 (2000 Revision) in 2003 and ISO 9001:2008 in 2011. We are audited annually by Moody International Certification Limited to ensure that our management systems continue to comply with the standards prescribed by ISO. Procurement quality control We receive inspection certificates and testing reports of fastener products from fastener manufacturers certifying that the fastener products we procure conform to applicable international standards such as DIN, JIS, ISO, BS and ANSI, as the case may be, depending on the intended application of the fastener product. Visual quality control Our warehouse supervisor and staff will visually inspect in-coming shipments of fastener products delivered to our warehouse for physical defects by sampling. All out-going fastener products are also inspected before delivery to our customers. In the event of any reported defects in the fastener products sold by us, we will liaise with the relevant fastener manufacturer to determine the nature of the defect. In the case of an inherent defect, the fastener manufacturer will typically replace the defective product.

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AWARDS AND CERTIFICATIONS As a testament of our commitment to quality, our Group has received several awards and certifications over the years, some of which are set out below: Year 1998 2001 2003 2011 2012 2012 Awarding Organisation Quality Certification Limited Moody International Certification Limited Moody International Certification Limited Moody International Certification Limited Singapore Enrich Group Pte Ltd Brands Entrepreneur Alliance (Singapore) Award/Certification ISO 9002:94 ISO 9002 ISO 9001 (2000 Revision) ISO 9001:2008 Top 100 Singapore Excellence Award 2011/2012 Singapore Brands Award 2012/2013

MAJOR CUSTOMERS We sell mainly to other distributors with retail networks who will, in turn, sell the fasteners to industrial end-users from diverse industries. As at the Latest Practicable Date, we have established a diversified pool of approximately 200 customers in more than 45 countries. Our sales to Indonesia, Malaysia and Singapore collectively accounted for 70.3%, 67.7% and 68.0% of our revenue in FY2010, FY2011 and FY2012, respectively. Save as disclosed below, there are no customers who accounted for 5% or more of our revenue for each of the last three financial years ended 31 December 2012: Percentage of revenue (%) FY2010 FY2011 FY2012 11.4 9.5 10.9 7.6 9.6 7.2

Customers Pan Sun Advance Bolt & Fasteners Sdn Bhd

During the period under review, the percentage of our Group’s revenue attributable to our major customers had generally declined on a yearly basis mainly due to the increase in contribution from our customers from other overseas markets. As at the date of this Offer Document, none of our Directors, Substantial Shareholders or the Associates of our Directors and Substantial Shareholders has any interest, direct or indirect, in any of the above customers.

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MAJOR SUPPLIERS As our products are generally generic in nature, we select our suppliers based on their reputation, reliability, pricing, purchase terms and timeliness of delivery. We generally do not enter into long-term or exclusive contracts with our suppliers as this allows us greater flexibility in terms of pricing, quality and timeliness of delivery of our products. Our Directors also believe that most of the products traded by our Group can be purchased from a number of different suppliers at prices comparable to those paid to our Group’s current suppliers. However, we have entered into various distribution agreements with some of our suppliers. Please refer to the sub-section entitled “ Distribution Agreements ” below for more details of these distribution agreements. Save as disclosed below, there are no suppliers who accounted for 5% or more of our total purchases for each of the last three financial years ended 31 December 2012: Percentage of total purchases (%) FY2010 FY2011 FY2012 1.0 25.1 5.8 6.2 6.4 13.8 32.8 1.8 25.9 6.7 6.1 6.5 14.4 28.1 5.2 27.5 4.5 5.8 5.8 15.0 25.8

Suppliers Cosmo Trading Co Ltd Fang Sheng Screw Co., Ltd. King Socket Screw Co Ltd L&W Fasteners Company Min Hwei Enterprise Co., Ltd. Shanghai Prime Machinery Co., Ltd. Tong Hwei Enterprise Co., Ltd.

Our total purchases from Tong Hwei generally declined between FY2010 and FY2012 due to a general decline in the price of these purchases although the volume of purchases had remained relatively stable. Our total purchases from each of our other major suppliers fluctuated year-on-year over the period under review due mainly to changes in demand for their products from our customers and our procurement policy of maintaining sufficient inventory for their products. As at the date of this Offer Document, none of our Directors, Substantial Shareholders or the Associates of our Directors and Substantial Shareholders has any interest, direct or indirect, in any of the above suppliers.

DISTRIBUTION AGREEMENTS The following table summarises the terms of the distribution agreements entered into by our Group with our major suppliers:
Name of supplier Fang Sheng Products supplied YFS screws Nature of distribution rights Sole distributor, including the right to use the “YFS” logo in advertising materials Territory of distribution Singapore, Malaysia, Indonesia, Sri Lanka, Cambodia and Myanmar Expiry date of agreement 31 December 2017

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Name of supplier Tong Hwei Products supplied THE stainless steel fasteners Nature of distribution rights Non-exclusive agent, including the right to use the “THE” logo in advertising materials Territory of distribution None specified Expiry date of agreement 31 December 2016

Save as disclosed above, we do not have any other long-term arrangements with our major suppliers.

CREDIT MANAGEMENT Customers We may extend credit terms ranging from 30 days to 60 days to certain customers on a case-by-case basis. Credit terms extended are based on factors such as length of customer relationship, credit-worthiness, past payment records, financial strength of the customer, as well as the size of the particular transaction. For other customers, we sell to them on cash terms. Depending on the length of customer relationship, credit-worthiness and the size of the particular transaction, we may request for letters of credit to be issued in our favour. We do not extend any credit terms to new customers until such customers have demonstrated a prompt payment track record. We regularly monitor our trade receivables ageing and follow up promptly on any overdue payments. We have established close rapport with our customers through our ability to meet their product requirements consistently. During the period under review, the majority of our revenue was generated from repeat customers. Our trade receivables turnover days for the last three financial years ended 31 December 2012 are as follows: FY2010 Trade receivable turnover days
Note: (1) Trade receivable turnover days is equivalent to average trade receivables balance divided by revenue multiplied by 365 days.
(1)

FY2011 56

FY2012 59

58

Specific provision is made when the recoverability of an outstanding debt is in doubt. We may also write off an outstanding debt when we are certain that the customer is unable to meet its financial obligations. We have not written off or provided for any bad and doubtful debts during the period under review and up to the Latest Practicable Date. Suppliers We typically trade with our suppliers on cash terms with one of our suppliers granting us 30 days credit from delivery date. We utilise trust receipts facilities granted by banks, which offer financing of between 120 and 150 days, to finance some of our purchases.

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Our trade payable turnover days for each of the last three financial years ended 31 December 2012 are as follows: FY2010 Trade payable turnover days
Note: (1) Trade payable turnover days is equivalent to average of the sum of trade payables and trust receipts balance divided by cost of sales multiplied by 365 days.
(1)

FY2011 65

FY2012 82

53

Our average trade payable turnover days increased during the period under review mainly as a higher amount of our trust receipts facilities was drawn down to finance our inventory purchases.

INSURANCE We have taken up insurance policies for risks such as fire, public liability and work injury compensation in relation to our property, inventory and staff. Our insurance policies are reviewed annually to ensure that they adequately satisfy both regulatory and business requirements. We may increase the coverage if we deem it necessary and appropriate. We have not experienced any difficulties obtaining or renewing our insurance policies, or on getting paid for our claims under any of our insurance policies. Our Directors believe that the policy specifications and insured limits of these insurance policies are in line with normal commercial practice. Save as disclosed under the section entitled “ Risk Factors ” of this Offer Document, our Directors believe that the coverage from these insurance policies is adequate for our present operations. However, significant damage or disruption to our operations or damage or loss to any of our properties, including our premises and inventory, whether as a result of fire and/or other causes, would still have a material adverse impact on our results of operations and financial condition.

PROPERTIES AND FIXED ASSETS As at the date of this Offer Document, the properties owned by our Group are set out below:
Approximate area 1,344 sq m Use of property Office and warehouse

Owner PS Fasteners

Location 3 Kaki Bukit Road 2, #01-06 Eunos Warehouse Complex, Singapore 417837

Tenure Leasehold 60 years commencing from 11 January 1982 Leasehold 60 years commencing from 11 January 1982

Encumbrances Mortgage in favour of Malayan Banking Berhad as mortgagee Mortgage in favour of UOB as mortgagee

PS Fasteners

3 Kaki Bukit Road 2, #01-07 Eunos Warehouse Complex, Singapore 417837

672 sq m

Warehouse

Save as disclosed in this section, none of our fixed assets is subject to any mortgage, pledge or any other encumbrances or otherwise used as security for any bank borrowings. As at 31 December 2012, the net book value of our fixed assets, including our leasehold properties and tools and equipment, amounted to approximately S$3.2 million. 80

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To the best of our Directors’ knowledge, save as disclosed in the sub-sections entitled “Government Regulations” and “Licences and Permits” of this Offer Document, there are no regulatory requirements or environmental issues that may materially affect our utilisation of our fixed assets.

INTELLECTUAL PROPERTY We have registered or are applying for the registration of the following trademarks:
Country of Registration Class Singapore 6(1) Granting Authority Intellectual Property Office of Singapore Registered Owner PS Fasteners

Trademark

Status Granted. Registration effective from 21 December 2010

Expiry Date 21 December 2020

Malaysia

6(1)

Intellectual Property Corporation of Malaysia

Pending. Application filed on 16 December 2010(2)



PS Fasteners

Notes: (1) (2) Class 6 refers to the specification of services under the International Classification of Goods and Services by the World Intellectual Property Organisation. The registration under Class 6 relates to bolts. We have been informed by the Malaysian Registry of Trademarks that we will be required to include the disclaimer “Registration of this trade mark shall give no right to the exclusive use of the words ‘Fasteners’ and ‘The Mix-And-Match Expert’.” over the words “Fasteners” and “The Mix-And-Match Expert”. The Company has decided to continue with the registration process on this basis.

Save as disclosed above, we do not own or use any other patents, trademarks or intellectual property on which our business or profitability is materially dependent.

RESEARCH AND DEVELOPMENT We do not conduct any research and development activities, as it is not in the nature of our business to do so.

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CORPORATE SOCIAL RESPONSIBILITY We recognise our responsibilities to our employees, shareholders, business partners and the communities in which we operate, and are committed to achieving long-term mutually sustainable relationships with these stakeholders. We strive to enhance our corporate social responsibility in the community though charitable contributions as well as through the provision of bursaries for the education of the children of our employees.

GOVERNMENT REGULATIONS Save as disclosed below, our business operations in Singapore are not subject to any special legislation or regulatory controls other than those generally applicable to companies and business incorporated and/or operating in Singapore. Thus far, we have not experienced any adverse effect on our business in complying with these regulations. To the best of our Directors’ knowledge and belief, we are not in breach of any law or regulation applicable to our business operations that would materially affect our business operations. 1. Regulation of Import and Export Pursuant to the Regulation of Imports and Exports Act (Chapter 272A) of Singapore (“ RIEA ”), regulations for the registration, regulation and control of all or any class of goods imported into, exported from, transshipped in or in-transit through Singapore may be made. We engage freight forwarders to undertake the import and export of our products and who will also make the necessary permit applications for our imports and exports on a transactional basis. The Regulation of Imports and Exports Regulations (“ RIER ”) was amended on 2 April 2013 by the Regulation of Imports and Exports (Amendment) Regulations 2013 (“ Amendment Regulations ”), pursuant to which Regulation 37 of the RIER was deleted and substituted with Regulations 35A to 35I (“ New Regulations ”). Regulation 37(1) of the RIER previously provided that the Director-General of Customs (“ DGC ”) may maintain a register containing the particulars of importers, exporters, common carriers or any other person who desires to apply for a permit or any other form of approval under the RIER. Under the New Regulations, any importer, exporter, shipping agent, air cargo agent, freight forwarder, common carrier or other person who desires to obtain a permit, certificate or any other document or form of approval for any purposes of the RIEA or any regulations made thereunder, the application for which involves a declaration being made is defined as a declaring entity. Pursuant to the new Regulation 35B of the RIER, the DGC may register as a registrant any person who is, amongst others, a declaring entity. Pursuant to the Amendment Regulations, as our subsidiary, PS Fasteners, was previously registered with the Singapore Customs as an importer and exporter under the old Regulation 37(1) of the RIER, we are deemed to have been registered as a registrant under the New Regulations. Our registration with the Singapore Customs is not subject to any material conditions or renewal requirements, but may be withdrawn at any time. 2. Factory Notification Any person who desires to occupy or use any premises where any building operation or works of engineering construction is or are being carried out by way of trade or for purposes of gain is required to apply to the Commissioner for Workplace Safety and Health (“ CWSH ”) to register the premises as a “factory” pursuant to the Workplace Safety and Health (Registration of Factories) Regulations 2008 (“ WSH Factories Regulations ”). 82

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Any person who desires to occupy or use any premises as a factory not falling within the classes of factories described within the First Schedule of the WSH Factories Regulations, shall, before the commencement of operation of the factory, submit a notification to the CWSH informing the CWSH of his intention to occupy or use those premises as a factory. However, in the event that the CWSH is of the view that the factory in respect of which a notification has been submitted poses or is likely to pose a risk to the safety, health and welfare of persons at work in the factory, the CWSH may, by notice in writing, (i) specify the date from which the notification shall cease to be valid; and (ii) direct the occupier of the factory to register the factory notwithstanding that the factory does not fall within any of the classes of the factories described in the First Schedule of the WSH Factories Regulations. Our warehouse, which is located at 3 Kaki Bukit Road 2, #01-06/07 Eunos Warehouse Complex, Singapore 417837, does not fall within any of the classes of the factories described in the First Schedule of the WSH Factories Regulations and accordingly, a notification to the CWSH will suffice. We have submitted the relevant notification to the CWSH. 3. Workplace Safety and Health The Workplace Safety and Health Act (Chapter 354A) of Singapore (“ WSHA ”) provides that every employer has the duty to take, so far as is reasonably practicable, such measures as are necessary to ensure the safety and health of his employees at work. These measures include providing and maintaining for those persons a work environment which is safe, without risk to health, and adequate as regards facilities and arrangements for their welfare at work, ensuring that adequate safety measures are taken in respect of any machinery, equipment, plant, article or process used by those persons, ensuring that those persons are not exposed to hazards arising out of the arrangement, disposal, manipulation, organisation, processing, storage, transport, working or use of things in their workplace or near their workplace and under the control of the employer, developing and implementing procedures for dealing with emergencies that may arise while those persons are at work and ensuring that those persons at work have adequate instruction, information, training and supervision as is necessary for them to perform their work. Additional duties imposed on employers are also set out in the Workplace Safety And Health (General Provisions) Regulations (“ WSHR ”). The relevant regulatory body is the MOM. Pursuant to the WSHR, the following equipment, amongst others, are required to be tested and examined by an examiner (“ Authorised Examiner ”), who is authorised by the CWSH, before they can be used in a workplace and thereafter, at specified intervals: (a) (b) (c) hoist or lift; lifting gears; and lifting appliances and lifting machines.

Upon examination, the Authorised Examiner will issue and sign a certificate of test and examination, specifying the safe working load of the equipment. Such certificate of test and examination shall be kept available for inspection. Under the WSHR, it is the duty of the occupier to keep a register containing the requisite particulars with respect to the lifting gears, lifting appliances and lifting machines.

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In addition, under the WSHA, inspectors appointed by the CWSH may, inter alia , enter, inspect and examine any workplace and any machinery, equipment, plant, installation or article at any workplace, to make such examination and inquiry as may be necessary to ascertain whether the provisions of the WSHA are complied with. Under the WSHA, the CWSH may serve a remedial order or a stop-work order in respect of a workplace if he is satisfied that (i) the workplace is in such condition, or is so located, or any part of the machinery, equipment, plant or article in the workplace is so used, that any work or process carried on in the workplace cannot be carried on with due regard to the safety, health and welfare of the persons at work; (ii) any person has contravened any duty imposed by the WSHA; or (iii) any person has done any act, or has refrained from doing any act which, in the opinion of the CWSH, poses or is likely to pose a risk to the safety, health and welfare of persons at work. The remedial order shall direct the person served with the order to take such measures, to the satisfaction of the CWSH, to, amongst others, remedy any danger so as to enable the work or process in the workplace to be carried on with due regard to the safety, health and welfare of the persons at work, whilst the stop-work order shall direct the person served with the order to immediately cease to carry on any work indefinitely or until such measures as are required by the CWSH have been taken to remedy any danger so as to enable the work or process in the workplace to be carried on with due regard to the safety, health and welfare of the persons at work. We have obtained the relevant certificates of test and examination for our lifting equipment and have not been served with a remedial order or stop-work order for our workplace at 3 Kaki Bukit Road 2, #01-06/07 Eunos Warehouse Complex, Singapore 417837. 4. Workmen’s Compensation The Work Injury Compensation Act (Chapter 354) of Singapore (“ WICA ”), which is regulated by the MOM, applies to all employees (with the exception of those set out in the Fourth Schedule of the WICA) who have entered into or work under a contract of service in respect of injury suffered by them in the course of their employment and sets out, amongst others, the amount of compensation they are entitled to and the method(s) of calculating such compensation. The WICA provides that if in any employment personal injury by accident arising out of and in the course of the employment is caused to an employee, the employer shall be liable to pay compensation in accordance with the provisions of the WICA. Further, the WICA provides, amongst others, that, where any person (referred to as the principal) in the course of or for the purpose of his trade or business contracts with any other person (referred to as the employer) for the execution by the employer of the whole or any part of any work, or for the supply of labour to carry out any work, undertaken by the principal, the principal shall be liable to pay to any employee employed in the execution of the work any compensation which he would have been liable to pay if that employee had been immediately employed by the principal. Unless exempted, employers are required to maintain adequate work injury compensation insurance for employees doing manual work as well as employees doing non-manual work and earning S$1,600 or less a month. We have in place work injury compensation insurance to cover our statutory obligations and liabilities under the WICA.

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5. PSA Licence Companies who wish to sponsor a PSA pass application must be licensed by PSA (except for shipping lines with a PSA agreement, government agencies and statutory boards). The license categorization depends on the company’s business activity and purpose of pass applicants’ entry into PSA’s restricted areas. A PSA pass is issued pursuant to the Protected Areas and Protected Places Act (Chapter 256) and the Free Trade Zones Act (Chapter 114) of Singapore and at the absolute discretion of PSA. Entry into PSA’s restricted areas without a valid PSA pass constitutes an offence. We have obtained a PSA Licence for Traders: Import/Export to allow us to operate in PSA’s restricted areas. 6. Employment of Foreign Workers The employment of foreign workers in Singapore is governed by the Employment of Foreign Manpower Act (Chapter 91A) (“ EFMA ”) and is regulated by the MOM. In Singapore, under Section 5(1) of the EFMA, no person shall employ a foreign employee unless he has obtained in respect of the foreign employee a valid work pass, which allows the foreign worker to work for him. Any person who fails to comply with or contravenes Section 5(1) of the EFMA shall be guilty of an offence and shall (a) be liable on conviction to a fine not less than S$5,000 and not more than $30,000 or to imprisonment for a term not exceeding 12 months or to both; and (b) on a second or subsequent conviction, (i) in the case of an individual, be punished with a fine of not less than $10,000 and not more than $30,000 and with imprisonment for a term of not less than one month and not more than 12 months; or (ii) in any other case, be punished with a fine not less than S$20,000 and not more than $60,000. An employer of foreign workers is also subject to, amongst others, the provisions set out in the Employment Act (Chapter 91) of Singapore, the EFMA, the Immigration Act (Chapter 133) of Singapore and the regulations issued pursuant to the Immigration Act. As at the date of this Offer Document, we have obtained work passes for all our foreign workers.

LICENCES AND PERMITS Our Directors have confirmed that, to the best of their knowledge and belief, our Group has obtained all requisite certifications, approvals and licences necessary for our current operations. The following is a description of the material licences (apart from those pertaining to general business requirements) required for the operations of our Group:
Licence/Permit number UEN 199102937E Issuing entity Singapore Customs

Licence/Permit Registration of Traders, Common Carriers and Others

Description Pursuant to Regulation 37(1) of the Regulation of Imports and Exports Regulations(1)

Expiry date Not applicable

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Licence/Permit number C1004227491510127-1 PS Fasteners Pte Ltd Issuing entity MOM

Licence/Permit Factory Notification

Description

Expiry date

Not applicable Pursuant to the Workplace Safety and Health (Registration of Factories) Regulations 2008, there is a duty to notify the Commissioner, appointed under Section 7 of the Workplace Safety and Health Act (Cap. 354A), of occupation or use of factory not falling within classes of factories described in the First Schedule of the Workplace Safety and Health (Registration of Factories) Regulations 2008 Pursuant to the Workplace Safety and Health Act 2006, that the lifting equipment complies in all respects with the requirements pertaining to lifting equipment as stipulated in the Workplace Safety and Health (General Provisions) Regulations, and all other regulations made thereunder and is safe for use. Pursuant to the Workplace Safety and Health Act 2006, that the lifting equipment complies in all respects with the requirements pertaining to lifting equipment as stipulated in the Workplace Safety and Health (General Provisions) Regulations, and all other regulations made thereunder and is safe for use. Pursuant to the Workplace Safety and Health Act 2006, that the lifting equipment complies in all respects with the requirements pertaining to lifting equipment as stipulated in the Workplace Safety and Health (General Provisions) Regulations, and all other regulations made thereunder and is safe for use. 27 November 2013

Certificate of test/ thorough visual examination of lifting equipment (LE)

803 LP-Hydraulic Working Platforms, Crown SP3520-30TT240, Distinctive No. 1A381633

MOM

Certificate of test/ thorough visual examination of lifting equipment (LE)

803 LP-Hydraulic Working Platforms, Crown SP3000-240, Distinctive No. 1A251350

MOM

27 November 2013

Certificate of test/ thorough visual examination of lifting equipment (LE)

803 LP-Hydraulic Working Platforms, Crown SP3520-30TT210, Distinctive No. S/N: 1A348731

MOM

27 November 2013

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Licence/Permit number 803 LP-Hydraulic Working Platforms, Crown SP3520-30TT210, Distinctive No. S/N: 1A350778 Issuing entity MOM

Licence/Permit Certificate of test/thorough visual examination of lifting equipment (LE)

Description Pursuant to the Workplace Safety and Health Act 2006, that the lifting equipment complies in all respects with the requirements pertaining to lifting equipment as stipulated in the Workplace Safety and Health (General Provisions) Regulations, and all other regulations made thereunder and is safe for use. Licence to operate in PSA’s restricted areas.

Expiry date 27 November 2013

Traders: Import/Export Licence
Note: (1)

R001499

PSA

31 July 2014

Please refer to the sub-section entitled “Government Regulations” above for more information about the Regulation of Imports and Exports Regulations.

COMPETITION We are engaged in a highly competitive and fragmented industry. Competition is generally based on the availability of a wide product range, timely delivery and price. We compete with a large number of fastener distributors on a regional and local basis, some of which may have greater financial resources than us. To a lesser extent, we also compete with fastener manufacturers who may sometimes sell directly to distributors with retail networks who are able, at times, to meet the manufacturers’ required minimum order quantities. However, these distributors would generally still rely on larger distributors to purchase their fastener requirements as they typically purchase a large variety of fastener products and do not normally order in large quantities. Some of our competitors in the fastener distribution business which are based in Singapore include T.E. Fasteners Pte. Ltd. and Sin Hong Hardware Pte Ltd. To the best of our Directors’ knowledge, none of our Directors or Substantial Shareholders or their respective Associates has any interest, direct or indirect, in any of our competitors listed above. Our Directors believe that new entrants to the industry will require significant capital resources to purchase a wide range of fastener inventory, invest in storage facilities and establish close relationships with suppliers and customers in order to compete effectively in this industry. To the best of our Directors’ knowledge, there are no known published statistics or official sources of information to establish our market share.

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COMPETITIVE STRENGTHS We believe that we have the following competitive strengths: Diverse range of products to satisfy customer requirements We offer an extensive product range in excess of 15,000 different types and sizes of fasteners that have diverse industrial applications and are able to supply them at any quantity for shipment to anywhere in the world at relatively short notice. Our products include screws, bolts, nuts, pins, anchors, rivets, washers and clips in a variety of materials as well as a variety of platings that can be used in, amongst others, infrastructure developments, structural fabrication and construction in civil works, transportation and manufacturing of heavy machinery, automotives and parts. We carry a ready inventory and have ready access to our suppliers to replenish our inventory. We are therefore able to satisfy our customers’ requirements for any mix, any quantity and anywhere across a broad spectrum of industries for delivery on a timely basis. Established relationships with our suppliers We have over the years established strong relationships with our suppliers. This has provided us with assurance of the continuity of our supplies including those of well established brands in the fastener industry such as YFS, THE, RECOIL and SFC, thereby enabling us to develop our customer network, respond promptly to our customers’ requirements and expand our geographical coverage with greater confidence. While we generally do not enter into long-term or exclusive contracts with our suppliers so as to provide us with greater flexibility in sourcing for our supplies, we have entered into distribution agreements with certain of our major suppliers and are the sole distributor for Fang Sheng’s YFS range of products in Singapore, Malaysia, Indonesia, Sri Lanka, Cambodia and Myanmar and the non-exclusive distributor for Tong Hwei’s THE products in Singapore. Further, in recognition of our long standing relationship with Fang Sheng, PS Fasteners was presented with an award in 2007 as Fang Sheng’s first export customer for its YFS range of products. Please refer to the sub-sections of “ General Information on Our Group ” entitled “ History ”, “ Major Suppliers ” and “ Distribution Agreements ” for more details of our strong relationships with our suppliers. Established relationships with our customers We are committed to supplying quality products and are dedicated to meeting our customers’ orders promptly. Over the years, we have established long-term relationships and have developed goodwill with many of our customers. As at the Latest Practicable Date, we have a diversified customer base comprising approximately 200 customers in more than 45 countries. Our Directors believe that we have established a track record and reputation as a reliable supplier of fasteners. For each of the last three financial years ended 31 December 2012, a significant proportion of our customers comprised repeat customers. We believe that this incidence of repeat orders from our existing customers is a testimony of their support to us and the quality of our service to them. Scalable business model which is not dependent on any single end-use industry We have put in place an online IT infrastructure which we believe has helped to improve our operational efficiency. This has enabled us to reach out online to our existing and potential customers as well as provide them with the convenience of placing their orders with us from anywhere, at anytime, of any mix and for any quantity. It has also enabled us to automate certain areas of our operations such as order processing and inventory management, thereby translating 88

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into a higher level of service and shorter lead times in response to our customers’ requests. With our IT infrastructure as our backbone, we believe that we have a scalable business model with which to drive our expansion plans. In addition, we believe that the extensive range of fastener products that we carry, which can cater to a broad spectrum of industrial applications, coupled with our diversified base of customers across countries, means that we are not dependent on any single end-use industry, which in turn enables us to ride through the different business and economic cycles of different industries and different countries. Experienced and committed management team Our Group is led by Teo Choon Hock and Kwek Keng Seng, each of whom has more than 30 years of experience in the fastener industry and who are instrumental in setting the strategic direction of our Group and in developing and expanding our business. Our Executive Chairman, Teo Choon Hock, has primary oversight of the performance and strategic goals of our Group while our Managing Director, Kwek Keng Seng, is primarily responsible for the overall management of the business operations of our Group, with particular oversight of our sales and warehouse teams.

PROSPECTS AND TRENDS Fasteners have a wide spectrum of commercial and industrial applications used in, amongst others, manufacturing of automotives and parts, aircraft, appliances, machinery, construction and infrastructure. We believe that given the wide spectrum of commercial and industrial applications of fasteners, the fastener industry is not dependent on any single end-use industry, but is generally dependent on factors such as population growth, industrial development and general economic conditions. We expect that increasing fixed investments and a rise in the manufacturing bases in emerging economies such as Asia Pacific, South America, Middle East and Africa will boost fastener demand compared to the more developed markets. As such, we have focused our marketing efforts on distributors with retail networks primarily in Southeast Asia, as well as in emerging markets such as South America. Our sales to customers in Indonesia, Malaysia and Singapore collectively accounted for approximately 70.3%, 67.7% and 68.0% of our revenue in FY2010, FY2011 and FY2012, respectively. Our Directors have made the following observations for the current financial year based on current trends to-date: (a) Subject to competitive and pricing pressures, we expect our revenue to generally follow the activity trend for the manufacture of durable goods, as well as in the construction and infrastructure industry. We expect our finance expenses to increase further due to the refinancing of our interest-free Directors’ loans of S$2.6 million, which were outstanding as at 31 December 2012, with commercial bank loans. We expect our administration expenses to increase as a result of the full year effect of the remuneration of new finance and administration staff who had joined us over the course of FY2012. Any difference in the net realisable value of our inventory and our carrying cost of inventory will impact our cost of sales.

(b)

(c)

(d)

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(e) Any change in the price of raw materials could affect the cost of our purchases of fasteners and this could, in turn, impact our gross margins. A portion of our listing expenses incurred in connection with the Placement that will be treated as a charge in our financial statements as well as ongoing compliance costs as a listed company will affect our financial results in FY2013. Please refer to the section entitled “ Use of Proceeds and Listing Expenses ” of this Offer Document for more details of our listing expenses.

(f)

Arising from the above factors and especially (b), (c) and (f), we believe that our results of operations for FY2013 would be affected and, hence, investors ought to be aware that our past results of operations are not necessarily indicative of our current and future results of operations. Save as disclosed above and in the sections entitled “ Risk Factors ”, and “ Management’s Discussion and Analysis of Financial Position and Results of Operations ” of this Offer Document, and barring any unforeseen circumstances, our Directors believe that there are no other known recent trends in production, sales and inventory, and in the costs and selling prices of products and services, as well as any other known trends, uncertainties, demands, commitments or events that are reasonably likely to have a material effect on net sales or revenues, profitability, liquidity or capital resources, or that would cause financial information disclosed in this Offer Document to be not necessarily indicative of our future operating results or financial condition. Please also refer to the section entitled “ Cautionary Note On ForwardLooking Statements ” of this Offer Document.

ORDER BOOK We have established a diverse pool of approximately 200 customers in more than 45 countries. Typically in our industry, our customers do not commit to definite and/or long-term purchase orders of their requirements for the various fastener products. We typically receive order enquiries from our customers through our internet website, facsimile or by email. Following receipt of the order enquiry, our sales and marketing team will send a sales quotation to the customer. Unless credit terms are extended to the customer, we will arrange for the delivery of the cargo to the customer upon payment of the invoice. Accordingly, given the nature of our business, the concept of an order book is not meaningful for us.

BUSINESS STRATEGIES AND FUTURE PLANS Our business strategies and future plans are as follows: To enhance our existing warehouse facilities and upgrade our inventory management system We plan to enhance our existing warehouse facilities through a reorganisation of our warehouse space and installation of new racks in line with our expansion plans. We also plan to upgrade our inventory management system and will consider either installing a new inventory management system or upgrading our existing inventory management system so as to enhance our ability to more efficiently track and manage an increased inventory and achieve a faster turnaround time in processing our customers’ orders.

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We intend to use approximately S$1.0 million of the net proceeds from the Placement for this purpose. To diversify our product range We have longstanding relationships with our customers and maintain frequent contact with them to better understand the market trends and their product demands and requirements. With this insight, we believe that we are in a better position to formulate appropriate strategies to expand our product range, thereby enabling us to meet our customers’ requirements of any mix of products and for any quantity for delivery on a timely basis. We believe that with a more comprehensive product range, we will be able to strengthen our position as a “Mix-And-Match Expert” for the supply of quality fasteners. The diversification of our product range will be funded by our working capital, which includes the net proceeds from the Placement allocated to our general working capital. To expand our business through acquisitions, joint ventures and/or strategic alliances We may also expand our business, whether in Singapore or overseas, through acquisitions, joint ventures and strategic alliances that we believe will complement our current and future business. We believe that suitable acquisitions, joint ventures and strategic alliances will give us access to new markets and customers as well as new businesses. As at the date of this Offer Document, we are not engaged in any discussion with any party for acquisitions, joint ventures or strategic alliances. Should such opportunities arise, we will seek the requisite approval, where necessary, from our Shareholders and the relevant authorities as may be required by the relevant rules and regulations.

WHERE YOU CAN FIND US Our registered office is located at 3 Kaki Bukit Road 2, #01-06 Eunos Warehouse Complex, Singapore 417837 and our principal place of business is located at 3 Kaki Bukit Road 2, #01-06/07 Eunos Warehouse Complex, Singapore 417837. Our telephone number is (65) 6747 7080 and our facsimile number is (65) 6742 0642. Our internet address is http://www.psfasteners.com. Information contained in our website does not constitute part of this Offer Document.

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MANAGEMENT REPORTING STRUCTURE The following chart shows our management reporting structure as at the date of this Offer Document.
Board of Directors

Executive Chairman Teo Choon Hock

Managing Director Kwek Keng Seng

Business Development Manager Teo Yong Tat

Financial Controller Seah Han Poh Benedict

DIRECTORS Our Board of Directors is entrusted with the responsibility for the overall management of our Group. The particulars of our Directors are set out below: Name Teo Choon Hock Kwek Keng Seng Age 58 56 Address 8 Cactus Crescent Singapore 809717 519 Yio Chu Kang Road #02-76 The Calrose Singapore 787085 C/o 72 Bendemeer Road #04-28 Luzerne Singapore 339941 219 Seagull Walk Singapore 486649 2 Sennett Close Singapore 466996 Position Executive Chairman Managing Director

Ang Miah Khiang

59

Lead Independent Director

Tan Jee Ming Tan Chin Keong

54 59

Independent Director Independent Director

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DIRECTORS, MANAGEMENT AND STAFF
Our Directors’ career and academic history, business experience and general areas of responsibility within our Group are set out below: Teo Choon Hock was appointed as our Director on 30 April 2013 and is our Executive Chairman. He is responsible for our Group’s overall management, including formulating our Group’s strategic goals, expansion plans and business strategies. Mr Teo, is one of the founding shareholders and directors of our subsidiary, PS Fasteners, and has been instrumental in our Group’s growth, leading the expansion of our business and operations since inception. He also oversees aspects of our day-to-day operations, such as in the areas of quality control, purchasing, finance and marketing. Mr Teo has over 30 years of experience in the fasteners industry. In 1982, Mr Teo was one of the founding partners of Pan Sun, where he was in charge of purchasing and treasury. Mr Teo was one of the partners primarily involved in developing Pan Sun’s import/export business, which was subsequently fully assumed by PS Fasteners in 1994. Mr Teo is the assistant public relations officer of the Singapore Metal and Machinery Association management council and Chairman of the Chong Pang Citizen Consultative Committee and was awarded the Public Service Medal in 2003 and the Public Service Star in 2008. He has been appointed as a Justice of Peace with effect from 8 May 2013. Mr Teo holds a Diploma in Business Administration from PSB International Management Academy and an Advanced Diploma in Management from SGP International Management Academy. Kwek Keng Seng was appointed as our Director on 31 May 2013 and is our Managing Director. He is responsible for assisting our Executive Chairman in the overall management of our Group’s business operations. Mr Kwek manages our day-to-day operations in the areas of sales and warehouse operations, formulating the sales strategies and setting sales targets for our Group as well as overseeing the storage and logistics management of our products. Mr Kwek has over 30 years of experience in the fasteners industry, and was one of the founding shareholders and directors of PS Fasteners, and has been instrumental in our Group’s growth. In 1982, Mr Kwek was one of the founding partners of Pan Sun, where he was in charge of sales and was also one of the partners primarily involved in Pan Sun’s import/export business, which was subsequently fully assumed by PS Fasteners in 1994. Mr Kwek completed his primary education in Singapore. Ang Miah Khiang was appointed as our Independent Director on 31 May 2013 and is also our Lead Independent Director. He holds various non-executive directorships and provides advisory services to companies from time to time. Since 1979, Mr Ang was with GE Commercial Financing (S) Ltd (formerly known as Heller Financial (S) Ltd) (“ GECF ”), where he was the Managing Director from 1991 to 2004, and was concurrently the regional director of other businesses related to GECF in the Asia Pacific region from 2001. In these roles, he was overall responsible for meeting operating plans and developing growth strategies. In 2004, Mr Ang left GECF to join DP Information Network Pte Ltd (“ DP Info ”) as its executive director, where he was responsible for providing support in corporate development and business development opportunities. In 2009, Mr Ang was re-designated as a non-executive director, and continues to serve at the board level for DP Info. From 2010 to 2011, he was appointed as Director, Corporate Advisory of Stone Forest Corporate Advisory Pte. Ltd., where he provided support in the areas of corporate and strategic development. Mr Ang sits on the boards of various companies, including Uni-Asia Holdings Limited and Ley Choon Group Holdings Limited, which are listed on the Main Board of the SGX-ST. Mr Ang holds a Bachelor of Accountancy from the University of Singapore and is a Fellow of the Institute of Singapore Chartered Accountants.

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Tan Jee Ming was appointed as our Independent Director on 31 May 2013 and is currently a director in Straits Law Practice LLC where he practices general civil and criminal law. Mr Tan has been in practice for over 25 years and commenced his legal practice in RCH Lim & Co in 1986. He practiced at various law firms before he became a partner in Derrick Jeffrey & Ravi in 1989. He subsequently set up his own sole proprietorship law firm under the name of Tan Jee Ming & Partners in 1996 before ceasing business to join Straits Law Practice LLC in 2010. Mr Tan currently sits on the board of Soilbuild Construction Group Ltd., which is listed on the Main Board of the SGX-ST. Mr Tan holds a Bachelor of Laws (Honours) from the National University of Singapore and is a member of the Singapore Academy of Law, the Law Society of Singapore Compensation Fund Committee, the Law Society of Singapore Inquiry Panel and the Singapore Institute of Directors. Tan Chin Keong was appointed as our Independent Director on 31 May 2013 and is currently the managing partner of GAAP Consulting Group LLP, which provides consultancy services for financial institutions. Mr Tan started his career in 1979 as an auditor in KPMG and, subsequently, Singapore Airlines. He then joined Chase Manhattan Bank in 1981 as regional auditor in charge of the audit of the bank’s branches in Southeast Asia. Mr Tan joined Tat Lee Bank in 1985 as Head of Internal Audit, and was subsequently appointed as Head of Singapore branches in 1988 where he had overall responsibility for sales, operations and credit policies. In 1993, he became the Head of International Department in charge of managing bank-wide international trade and treasury operations. Mr Tan left Tat Lee Bank in 1998 to join Standard Chartered Bank where he took on various senior management roles, including Regional Head of Infrastructure and Operations for Southeast Asia and Regional Head of Operations for Northeast Asia. Mr Tan established GAAP Consulting Group LLP in 2011. Mr Tan holds a Bachelor of Accountancy from the University of Singapore.

EXPERIENCE AND TRAINING OF OUR DIRECTORS Our Directors have the appropriate expertise to act as directors of our Company, as evidenced by their business and working experience set out above. All our Directors have been informed of their obligations under the Listing Manual as well as the relevant Singapore laws and regulations. Ang Miah Khiang and Tan Jee Ming have prior experience as directors of public listed companies in Singapore and are therefore familiar with the roles and responsibilities of a director of a public listed company in Singapore. Teo Choon Hock, Kwek Keng Seng, Tan Jee Ming and Tan Chin Keong have recently attended programmes conducted by the Singapore Institute of Directors and supported by the SGX-ST and are aware of the roles and responsibilities of a director of a public listed company in Singapore. The list of present and past directorships of each Director over the last five years up to the Latest Practicable Date and excluding those held in our Company, is set out below: Name Teo Choon Hock Present directorships Group corporations PS Fasteners Pte. Ltd. Other corporations Daxinhang Sdn Bhd TCH Investment Holdings (Pte.) Ltd. Think! Studio Pte. Ltd. Past directorships Group corporations – Other corporations Hakuruma Technology Pte. Ltd. T Land Investment Pte. Ltd.

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Name Kwek Keng Seng Present directorships Group corporations PS Fasteners Pte. Ltd. Other corporations – Ang Miah Khiang Group corporations – Other corporations DP Information Network Pte Ltd Ley Choon Group Holdings Limited SPRING Equity Investments Pte. Ltd. SPRING SEEDS Capital Pte. Ltd. Uni-Asia Holdings Limited Past directorships Group corporations – Other corporations – Group corporations – Other corporations Anwell Technologies Limited Asia Enterprises Holding Limited BRIS Information Services Sdn Bhd Cal-comp Precision (Singapore) Limited DP Credit Bureau Pte. Ltd. Heller Factoring (Malaysia) Sdn Bhd (voluntarily liquidated) Heng Long International Ltd. Pan Asian Holdings Limited RAM Credit Information Sdn Bhd SEF Group Ltd. Sei Woo Technologies Pte. Ltd. Group corporations – Other corporations –

Tan Jee Ming

Group corporations – Other corporations Soilbuild Construction Group Ltd. Straits Law Practice LLC

Tan Chin Keong

Group corporations – Other corporations –

Group corporations – Other corporations –

EXECUTIVE OFFICERS The day-to-day operations of our Group are entrusted to our Executive Directors who are assisted by an experienced and qualified team of Executive Officers. The particulars of our Executive Officers are set out below: Name Teo Yong Tat Seah Han Poh Benedict Age 22 42 Address 8 Cactus Crescent Singapore 809717 25 Kovan Road #16-21 Singapore 545024 Principal occupation Business Development Manager Financial Controller

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Our Executive Officers’ career and academic history, business experience and areas of responsibility within our Group are set out below: Teo Yong Tat is our Business Development Manager and is responsible for establishing and/or maintaining relationships with our customers and suppliers, developing business opportunities in existing and potential markets as well as reviewing quotations for and confirming orders with customers. Mr Teo joined PS Fasteners in 2011 as a sales and marketing executive and was promoted to his current position in 2012. Mr Teo holds a Diploma in Commerce (General Studies) from Kaplan. Seah Han Poh Benedict was appointed as our Financial Controller in 2012. He is responsible for all finance related functions of our Group, in particular, financial planning, budgeting, treasury, cost accounting, decision support and tax planning. Mr Seah started his career in 1994 as an audit assistant in KPMG. In 2000, he left KPMG to join Metalock Marine Pte Ltd (a subsidiary of MTQ Corporation Limited, a company listed on the SGX-ST) as a senior accountant and was subsequently re-designated as deputy finance manager in 2001. In 2002, Mr Seah was deployed to MTQ Corporation Limited where he assisted in the consolidation of accounts for one of its Singapore subsidiaries and was also involved in the review of internal controls for some of the overseas subsidiaries of the group. He was promoted to finance manager in 2003 before leaving in 2006 to join Albedo Limited, a Catalist-listed company, as a finance manager. In 2007, Mr Seah joined China Water Holdings Pte. Ltd., then an associate of CNA Group Limited which is listed on the Main Board of the SGX-ST, as financial controller. In 2009, Mr Seah joined Kok Tong Construction Pte Ltd as an accounts manager until 2010, when he joined Parakou Shipmanagement Pte Ltd as a finance and accounts manager. Mr Seah holds a Diploma in Accountancy from Singapore Polytechnic and has obtained a professional qualification from the Association of Chartered Certified Accountants. He is a Chartered Accountant of Singapore. Our Audit Committee, after having conducted an interview with Seah Han Poh Benedict and after having considered: (a) the qualifications and past working experience of Seah Han Poh Benedict which are compatible with his position as Financial Controller of our Group; Seah Han Poh Benedict’s demonstration of the requisite competency in finance-related matters of our Group in connection with the preparation for the listing of our Company; and the absence of negative feedback on Seah Han Poh Benedict from the representatives of our Group’s Independent Auditors and Reporting Accountants, Ernst & Young LLP,

(b)

(c)

is of the view that Seah Han Poh Benedict is suitable for the position of Financial Controller of our Group. Further, based on the foregoing, after making all reasonable enquiries, and to the best of their knowledge and belief, nothing has come to the attention of our Audit Committee members to cause them to believe that Seah Han Poh Benedict does not have the competence, character and integrity expected of the Financial Controller of our Group. In addition, Seah Han Poh Benedict shall be subject to performance appraisal by our Audit Committee on an annual basis to ensure satisfactory performance.

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The list of present and past directorships of each Executive Officer over the last five years up to the Latest Practicable Date and excluding those held in our Company, is set out below: Name Teo Yong Tat Present directorships Group corporations – Other corporations – Seah Han Poh Benedict Group corporations – Other corporations – Past directorships Group corporations – Other corporations – Group corporations – Other corporations –

There is no arrangement or understanding with a Substantial Shareholder, customer or supplier of our Group or other person, pursuant to which any of our Directors or Executive Officers was selected as a Director or an Executive Officer of our Company. Our Executive Chairman, Teo Choon Hock, is the father of our Business Development Manager, Teo Yong Tat. Save as disclosed, none of our Directors, Executive Officers and Substantial Shareholders is related to one another by blood or marriage.

DIRECTORS’ AND EXECUTIVE OFFICERS’ REMUNERATION The remuneration (including salary, bonus, contributions to CPF, directors’ fees, allowances and benefits-in-kind) paid during FY2011 and FY2012 and the estimated remuneration to be paid for the current FY2013 to our Directors and Executive Officers for services rendered to our Group are set out in the following remuneration bands (1): FY2011 Directors Teo Choon Hock Kwek Keng Seng Ang Miah Khiang Tan Jee Ming Tan Chin Keong Executive Officers Teo Yong Tat Seah Han Poh Benedict
Notes: (1) Remuneration bands: “Band A” refers to remuneration of up to S$250,000. “Band B” refers to remuneration between S$250,001 and S$500,000. “Band C” refers to remuneration between S$500,001 and S$750,000. (2) In relation to our Executive Directors, the estimated remuneration to be paid for FY2013 takes into account the annual fixed bonus of three months of the last drawn salary due to the respective Executive Director pursuant to the Service Agreements but does not take into account any performance bonus to be paid pursuant to the Service Agreements. In relation to our Executive Officers, the estimated remuneration to be paid for FY2013 does not take into account any bonuses due to them.

FY2012 Band C Band B – – – Band A Band A

FY2013 (2) Band B Band B Band A Band A Band A Band A Band A

Band C Band B – – – Band A –

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Excluding our Directors and Executive Officers whose relationship with one another is disclosed above, none of our full-time employees are related to our Directors and Substantial Shareholders. Any new employment of related employees and the proposed terms of their employment will be subject to the review and approval of our Remuneration Committee. In the event that a member of our Remuneration Committee is related to the employee under review, he will abstain from the review.

EMPLOYEES As at the Latest Practicable Date, we have 20 full-time employees. A breakdown of our full-time employees by function is as follows: As at the Latest Practicable Date 2 5 9 4 20

< Function Executive Directors Sales Warehouse Finance and administration Total 2010 2 4 8 1 15

As at 31 December 2011 2 5 9 1 17 2012 2 6 9 3 20

>

We do not experience any significant seasonal fluctuations in our number of employees. We do not employ a significant number of temporary employees. Save for certain of our employees who have taken up memberships in NTUC, none of our employees is a member of any labour union. The relationship and co-operation between our management and staff has been good and is expected to remain so in the future. There has not been any incidence of work stoppages or labour disputes which has affected our operations. Pension or retirement benefits As at the Latest Practicable Date, other than amounts set aside or accrued in respect of the relevant laws and regulations, we have not set aside or accrued any amounts for any of our employees to provide for pension, retirement or similar benefits to our employees.

SERVICE AGREEMENTS On 18 June 2013, our Company entered into respective Service Agreements with our Executive Directors, Teo Choon Hock and Kwek Keng Seng (each an “ Appointee ”). The Service Agreements are valid for an initial period of three years with effect from the date of admission of our Company to Catalist (“ Initial Term ”). Upon the expiry of the Initial Term, the employment of the Appointees shall be automatically renewed on a year-on-year basis on such terms and conditions as the parties may agree.

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DIRECTORS, MANAGEMENT AND STAFF
During the Initial Term, our Company may terminate the respective Service Agreements by giving to the other party not less than six months’ notice in writing, or in lieu of notice, payment of an amount equivalent to six months’ salary based on the Appointee’s last drawn monthly salary. At any time after the Initial Term, either party may terminate the respective Service Agreements at any time by giving to the other party not less than six months’ notice in writing, or in lieu of notice, payment of an amount equivalent to six months’ salary based on the Appointee’s last drawn monthly salary. Our Company may also terminate the employment of each Appointee at any time without notice or payment in lieu of notice under the following circumstances: (a) if the Appointee is guilty of any gross default or grave misconduct in connection with or affecting the business of our Group; in the event of any serious or repeated breach or non-observance by the Appointee of any of the stipulations contained in the Service Agreement; if the Appointee becomes bankrupt or makes any composition or enters into any deed of arrangement with his creditors; if the Appointee shall become of unsound mind; or if the Appointee commits any act of criminal breach of trust or dishonesty.

(b)

(c)

(d) (e)

The Service Agreements provide for, inter alia, the salary payable to the Appointees, annual leave, medical benefits, grounds of termination and certain restrictive covenants (including non-compete obligations). Under the terms of the respective Service Agreements, Teo Choon Hock and Kwek Keng Seng are entitled to a monthly salary of S$30,000 and S$25,000 respectively, as well as an annual fixed bonus of three months of his last drawn monthly salary. The Appointees are also entitled to receive a performance bonus based on our Group’s audited consolidated profit before tax before payment of any performance bonus (“ PBT ”), provided that the Appointee is under the employment of the Group on the last day of the relevant financial year. The amount of performance bonus will be determined as follows: Amount of Performance Bonus Where PBT is equal to or less than S$2 million Teo Choon Hock Kwek Keng Seng Nil Nil Where PBT exceeds S$2 million 3% of the difference between PBT and S$1.5 million 3% of the difference between PBT and S$1.5 million

All reasonable travelling, hotel, entertainment and such other out-of-pocket expenses incurred by the Appointees in the discharge of their duties will be borne by our Company. Each of the Service Agreements may be terminated by our Company by summary notice upon the occurrence of certain events, such as criminal conviction, grave misconduct or bankruptcy involving the relevant Appointee. None of the Appointees will be entitled to any benefit upon termination of his Service Agreement.

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Under the Service Agreements, the remuneration of the Appointees is subject to annual review by the Remuneration Committee. Subject to the approvals of the Shareholders of our Company, the SGX-ST and other regulatory authorities, where necessary, and subject to the eligibility criteria set out in the relevant employee share scheme or plan, each Appointee shall be eligible to participate in any employee scheme or plan implemented by our Company on such terms as may be determined by our Remuneration Committee at its sole and absolute discretion. Had the Service Agreements mentioned above and the Directors’ fees payable to the Appointees for FY2013 been in effect since 1 January 2012, the aggregate remuneration (including directors’ fees, contributions to the CPF and other benefits, if any) paid or provided to our Executive Directors would have been approximately S$882,000 instead of S$942,000 and the audited profit before taxation of our Group for FY2012 would have been approximately S$1.4 million instead of S$1.3 million. Under the Service Agreements, each of the Appointees has covenanted not to do business with any person who has done business with us or entice away any of our employees in connection with the carrying on of any business similar to or in competition with our business for 12 months after ceasing to be employed with our Group. Each of the Appointees has also covenanted not to carry on any activity or business in competition with us within Singapore or any country in which we have operations for 12 months after ceasing to be employed with our Group. Save as disclosed above, there are no other existing or proposed service agreements between our Company and our subsidiary with any of our Directors. There are no existing or proposed service agreements entered into or to be entered into between our Company and our subsidiary with any of our Directors which provide for benefits upon termination of employment. Save as disclosed above, there are no bonus or profit-sharing plans or any other profit-linked agreements or arrangements between our Company and any of our Directors, Executive Officers or employees.

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INTERESTED PERSON TRANSACTIONS
In general, transactions between our Group and any of its interested persons (namely, our Directors, CEO or Controlling Shareholders of our Company or the Associates of such Directors, CEO or Controlling Shareholders) would constitute interested person transactions for the purpose of Chapter 9 of the Listing Manual. This section sets out details of interested person transactions for the last three financial years ended 31 December 2012 and for the period commencing from 1 January 2013 up to the Latest Practicable Date (the “ Relevant Period ”). Save as disclosed below and in the sections entitled “ Restructuring Exercise ” and “ General Information on Our Group – History ” of this Offer Document, our Group does not have any other material transactions with any of its interested persons during the Relevant Period.

PAST INTERESTED PERSON TRANSACTIONS Loans from Teo Choon Hock and Kwek Keng Seng Our Executive Directors and Controlling Shareholders, Teo Choon Hock and Kwek Keng Seng, had extended loans to our Group for working capital purposes. These loans were unsecured, interest-free and had no fixed term of repayment. Accordingly, these transactions were not carried out on an arm’s length commercial terms basis. The loans outstanding, rounded to the nearest dollar, as at the end of each of the last three financial years ended 31 December 2012 and as at the Latest Practicable Date were as follows: As at the Latest Practicable Date (S$) 300,000 300,000

2010 (S$) Loans from Teo Choon Hock Loans from Kwek Keng Seng 1,300,000 1,300,000

As at 31 December 2011 (S$) 1,300,000 1,300,000

2012 (S$) 1,300,000 1,300,000

During the Relevant Period, the largest outstanding amount owed by our Group to each of Teo Choon Hock and Kwek Keng Seng was S$1.3 million. As at the Latest Practicable Date, the amount owed by our Group to each of Teo Choon Hock and Kwek Keng Seng was S$300,000. All loans owing by us to Teo Choon Hock and Kwek Keng Seng have been fully repaid as at the date of this Offer Document. We do not intend to enter into similar transactions with the above interested persons following the admission of our Company to Catalist.

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INTERESTED PERSON TRANSACTIONS
PRESENT AND ON-GOING INTERESTED PERSON TRANSACTIONS Provision of personal guarantees by Teo Choon Hock and Kwek Keng Seng Our Executive Directors and Controlling Shareholders, Teo Choon Hock and Kwek Keng Seng, have provided joint and several personal guarantees to financial institutions to secure banking/credit facilities extended to our subsidiary, PS Fasteners, as follows: Financial institution DBS Bank Ltd Banking/ credit facility Overdraft, import line, foreign exchange line and clean bills purchased facilities Term loan, revolving credit facility, letter of credit, trust receipt, shipping guarantee and foreign exchange line facilities Letter of credit, trust receipt, import loan, import invoice financing and shipping guarantee Term loan, letter of credit, trust receipts and foreign exchange facilities Guarantor Teo Choon Hock and Kwek Keng Seng Amount guaranteed All monies owing

Malayan Banking Berhad

Teo Choon Hock and Kwek Keng Seng

S$3,600,000

Standard Chartered Bank (1)

Teo Choon Hock and Kwek Keng Seng

All monies owing

UOB

Teo Choon Hock and Kwek Keng Seng

S$2,700,000

Note: (1) Due to the discharge of mortgage in favour of Standard Chartered Bank at 3 Kaki Bukit Road 2, #01-07 Eunos Warehouse Complex, Singapore 417837, Standard Chartered Bank has, as at the Latest Practicable Date, withdrawn the overdraft facility granted to us and has reduced the trade finance facility from S$2.5 million to S$2.0 million. We are currently finalising the terms of the revised facility letter with Standard Chartered Bank.

The largest aggregate outstanding amount of the above banking/credit facilities guaranteed and secured during the Relevant Period by Teo Choon Hock and Kwek Keng Seng, based on month-end balances, was approximately S$5.3 million. As at the Latest Practicable Date, the aggregate outstanding amount guaranteed and secured was approximately S$5.4 million. The interest rates on the above banking/credit facilities range from 1.4% to 6.8% per annum, or such other rate(s) as the respective institutions may determine from time to time. As no fee was paid to Teo Choon Hock and Kwek Keng Seng for the provision of the above guarantees, the above arrangements were not carried out on an arm’s length commercial terms basis. Following the admission of our Company to Catalist, we intend to procure a release and discharge of the abovementioned guarantees from the relevant financial institutions. If we are unable to procure the release and discharge of these guarantees, Teo Choon Hock and Kwek Keng Seng will either continue to provide the guarantees required to secure these banking/credit facilities or seek and obtain alternative facilities from other financial institutions offering comparable terms without the need for such personal guarantees. 102

INTERESTED PERSON TRANSACTIONS
GUIDELINES AND TRANSACTIONS REVIEW PROCEDURES FOR FUTURE INTERESTED PERSON

All future interested person transactions will be properly documented and submitted to our Audit Committee for periodic review to ensure that they are carried out on an arm’s length basis, on normal commercial terms, and will not be prejudicial to the interests of our minority Shareholders. In respect of all future interested person transactions, we will implement the following review procedures: (a) in relation to any purchase of products or procurement of services from interested persons, quotes from at least two unrelated third parties in respect of the same or substantially the same type of transactions will be used as comparison wherever possible. The Audit Committee will review the comparable factors, taking into account, inter alia , the suitability, quality, timeliness in delivery and cost of the product or service, and the experience and expertise of the supplier. Transactions with such interested persons shall not be on terms less favourable to our Group than those with unrelated third parties; in relation to any sale of products or provision of services to interested persons, the price and terms of two other completed transactions of the same or substantially the same type of transactions to unrelated third parties are to be used as comparison wherever possible. Transactions with such interested persons shall not be on terms less favourable to our Group than those with unrelated third parties; when renting from or to interested persons, our Audit Committee shall take appropriate steps to ensure that such rent is commensurate with the prevailing market rates, including adopting measures such as making relevant enquiries with landlords of properties of similar location and size, or obtaining necessary reports or reviews published by property agents (including an independent valuation report by a property valuer, where appropriate). The rent payable shall be based on the most competitive market rental rate of similar properties in terms of size and location, based on the results of the relevant enquiries; where it is not possible for appropriate information (for comparative purposes) to be obtained, the interested person transaction will be approved by our Audit Committee, who has no interest in the transaction, who will determine whether the price, fees and/or other terms offered by or to the interested persons are fair and reasonable, with consideration to whether the price, fees and/or other terms are in accordance with our usual business practices and policies. In determining the transaction price payable to the interested person for such products and/or services, our Audit Committee will determine whether the relevant transaction is undertaken at an arm’s length basis and on normal commercial terms, taking into account factors such as, but not limited to, suitability, quantity, quality, requirements and specifications; and any contracts to be made with an interested person shall not be approved unless the pricing is determined in accordance with our usual business practices and policies for the same or substantially similar type of transactions between us and unrelated parties on terms that are no more favourable than those extended to, or no less favourable than those received from other unrelated parties.

(b)

(c)

(d)

(e)

In addition, we shall monitor all interested person transactions entered into by us by categorising the transactions as follows: (a) a “category one” interested person transaction (either individually or as part of a series or is aggregated with other transactions involving the same interested person during the same financial year) is one where the value or aggregate thereof is equal to or in excess of 3% of the latest audited NTA of our Group; and 103

INTERESTED PERSON TRANSACTIONS
(b) a “category two” interested person transaction (either individually or as part of a series or is aggregated with other transactions involving the same interested person during the same financial year) is one where the value or aggregate thereof is below 3% of the latest audited NTA of our Group.

“Category one” interested person transactions must be reviewed and approved by our Audit Committee prior to entry. “Category two” interested person transactions must be approved by a Director who shall not be an interested person in respect of the particular transaction prior to entry and must be reviewed on a half-yearly basis by our Audit Committee. In its review, our Audit Committee will ensure that all future interested person transactions are conducted on normal commercial terms and are not prejudicial to the interests of our Company and its minority Shareholders. All interested person transactions shall be subject to review by our Audit Committee on a half-yearly basis. In respect of all interested person transactions, we shall adopt the following policies: (a) In the event that a member of our Audit Committee is interested in any interested person transaction, he will abstain from deliberating, reviewing and/or approving that particular transaction. We shall maintain a register to record all interested person transactions which are entered into by our Group (including the basis on which they are entered into) and the review and/or approval of our Audit Committee. We shall incorporate into our internal audit plan a review of all interested person transactions entered into by our Group. Our Audit Committee shall review the internal audit reports at least annually to ensure that all interested person transactions are carried out on an arm’s length basis and in accordance with the procedures outlined above.

(b)

(c)

(d)

Furthermore, if during these periodic reviews our Audit Committee believes that the guidelines and procedures as stated above are not sufficient to ensure that the interests of minority Shareholders are not prejudiced, we will adopt new guidelines and procedures. The Audit Committee may request for an independent financial adviser’s opinion as it deems fit. We shall ensure that all interested person transactions comply with the provisions in Chapter 9 of the Listing Manual, and if required, we will seek independent Shareholders’ approval for such transactions. In accordance with Rule 919 of the Listing Manual, interested persons and their Associates shall abstain from voting on resolutions approving interested person transactions involving themselves and our Group. In addition, such interested persons shall not act as proxies in relation to such resolutions unless voting instructions have been given by the Shareholder(s). Our Audit Committee will include the review of interested person transactions as part of its standard procedures while examining the adequacy of our internal controls. Our Board of Directors will ensure that all disclosures, approvals and other requirements on interested person transactions, including those required by prevailing legislation, rules, regulations, the Listing Manual and relevant accounting standards, are complied with. We will disclose in our annual report the aggregate value of interested person transactions during the financial year.

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POTENTIAL CONFLICTS OF INTERESTS All our Directors have a duty to disclose their interests in respect of any transactions in which they have any personal material interest or any actual or potential conflict of interest (including a conflict that arises from their directorship or employment or personal investment in any corporate action). Upon such disclosure, such Directors will not participate in any proceedings of our Board and shall abstain from voting in respect of any such transaction where the conflict arises. Save as disclosed in the sections entitled “ Interested Person Transactions ”, “ General Information on Our Group – History ” and “ Restructuring Exercise ” of this Offer Document, none of our Directors, Executive Officers, Substantial Shareholders or any of their Associates has any interest, direct or indirect, in: (a) (b) any transaction to which we were or are to be a party; any entity carrying on the same business or a similar trade which competes materially and directly with the existing business of our Group; and any entity that is our customer or supplier of goods and services.

(c)

Interests of Experts No expert is interested, directly or indirectly, in the promotion of, or in any property or assets which have, within the two years preceding the date of this Offer Document, been acquired or disposed of by or leased to our Company or our subsidiary or are proposed to be acquired or disposed of by or leased to our Company or our subsidiary. No expert is employed on a contingent basis by our Company or our subsidiary; or has a material interest, whether direct or indirect, in our Shares or the shares of our subsidiary; or has a material economic interest, whether direct or indirect, in our Company, including an interest in the success of the Placement. Interests of Sponsor and Placement Agent In the reasonable opinion of our Directors, save as disclosed below and in the section entitled “ General and Statutory Information – Management and Placement Arrangements ” of this Offer Document, our Company does not have any material relationship with the Sponsor and Placement Agent or any other financial adviser in relation to the Placement: (a) (b) (c) (d) (e) UOB is the Sponsor of the Placement; UOB is the Placement Agent of the Placement; UOB is one of our Company’s principal bankers; UOB is the Receiving Banker of the Placement; and UOB will be the continuing Sponsor of our Company for an initial period of three years from the date our Company is admitted to and listed on Catalist.

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CORPORATE GOVERNANCE
Our Directors recognise the importance of corporate governance and the offering of high standards of accountability to our Shareholders, and will use best efforts to implement the good practices recommended in the Code of Corporate Governance 2012 (“ Code ”). Our Board of Directors has formed three committees, namely, the Audit Committee, the Remuneration Committee and the Nominating Committee. We have five Directors on our Board of Directors, of which three are Independent Directors. We have appointed Ang Miah Khiang as our Lead Independent Director. As Lead Independent Director, he is the contact person for Shareholders in situations where there are concerns or issues which communication with our Executive Chairman, Managing Director and/or Financial Controller has failed to resolve or where such communication is inappropriate. Ang Miah Khiang will also take the lead in ensuring compliance with the Code.

BOARD PRACTICES Our Directors are appointed by our Shareholders at a general meeting, and an election of Directors takes place annually. One third (or the number nearest one third) of our Directors, are required to retire from office at each annual general meeting. Further, all our Directors are required to retire from office at least once in every three years. However, a retiring Director is eligible for re-election at the meeting at which he retires. Further details of the appointment and retirement of Directors can be found in the section entitled “ Summary of Selected Articles of Association of Our Company ” as set out in Appendix C of this Offer Document. Our Directors shall generally avoid approving the appointment of alternate directors. Alternate directors shall only be appointed for limited periods in exceptional cases such as when a Director has a medical emergency. If an alternate director is appointed, the alternate director shall be familiar with our Company’s affairs and be appropriately qualified. If a person is proposed to be appointed as alternate director to an Independent Director, our Nominating Committee and our Directors shall review that the person would qualify as an Independent Director before his appointment. Nominating Committee Our Nominating Committee comprises Ang Miah Khiang, Tan Jee Ming, Tan Chin Keong and Teo Choon Hock. The Chairman of the Nominating Committee is Tan Jee Ming. Our Nominating Committee will be responsible for: (a) the nomination and re-nomination of our Directors having regard to their contribution, performance and ability to commit sufficient time and attention to the affairs of our Group, taking into account their respective commitments outside our Group; determining annually whether or not a Director is independent; deciding whether or not a Director is able to and has been adequately carrying out his duties as a director; reviewing Board succession plans for Directors; development of a process for evaluation of the performance of the Board, its committees and Directors;

(b) (c)

(d) (e)

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(f) (g) reviewing training and professional developments programs for the Board; reviewing and approving any new employment of persons related to the Directors, CEO and Substantial Shareholders and the proposed terms of their employment; and the appointment and re-appointment of Directors (including alternate directors, if applicable).

(h)

Our Nominating Committee will decide how the Board’s performance is to be evaluated and will propose objective performance criteria, subject to the approval of the Board, which address how the Board has enhanced long-term Shareholders’ value. The Board will also implement a process to be carried out by our Nominating Committee for assessing the effectiveness of the Board as a whole and for assessing the contribution of each individual Director to the effectiveness of the Board. Each member of our Nominating Committee will not take part in determining his own re-nomination or independence and shall abstain from voting on any resolutions in respect of the assessment of his performance or re-nomination as a Director or that of employees related to him. Nominating Committee’s view of our Independent Directors The Nominating Committee having taken into consideration the following: (a) (b) (c) the number of SGX-ST listed company board representations by Ang Miah Khiang; the principal commitments of the Independent Directors; the confirmations by the Independent Directors stating that they are each able to devote sufficient time and attention to the matters of the Company; the Independent Directors’ working experience and expertise in different areas of specialisation; and the composition of the Board,

(d)

(e)

is of the view that each of Ang Miah Khiang, Tan Jee Ming and Tan Chin Keong is individually and collectively able to devote sufficient time to the discharge of their duties and are suitable and possess relevant experience as Independent Directors of our Company. Remuneration Committee Our Remuneration Committee comprises Ang Miah Khiang, Tan Jee Ming and Tan Chin Keong. The Chairman of the Remuneration Committee is Tan Chin Keong. Our Remuneration Committee will recommend to our Board a framework of remuneration for our Directors and Executive Officers, and determine specific remuneration packages for each Executive Director. The recommendations of our Remuneration Committee will be submitted for endorsement by the entire Board. All aspects of remuneration, including but not limited to directors’ fees, salaries, allowances, bonuses, the Awards to be granted under the PSP, the Options to be issued under the ESOS and other benefits-in-kind shall be covered by our Remuneration Committee. In addition, our Remuneration Committee will perform an annual review of the remuneration of employees related to our Directors and/or Substantial Shareholders to ensure that their remuneration packages are in line with our staff remuneration guidelines and commensurate with 107

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their respective job scopes and level of responsibilities. They will also review and approve any bonuses, pay increases and/or promotions for these employees. Each member of our Remuneration Committee shall abstain from voting on any resolutions in respect of his remuneration package or that of employees related to him. Audit Committee Our Audit Committee comprises Ang Miah Khiang, Tan Jee Ming and Tan Chin Keong. The Chairman of the Audit Committee is Ang Miah Khiang. Our Audit Committee will assist our Board in discharging its responsibility to safeguard our assets, maintain adequate accounting records, and develop and maintain effective systems of internal control, with the overall objective of ensuring that our management creates and maintains an effective control environment in our Group. Our Audit Committee will provide a channel of communication between our Board, our management, our internal auditors and our external auditors on matters relating to audit. Our Audit Committee will meet periodically to perform the following functions: (a) review the relevance and consistency of the accounting standards and policies, the significant financial reporting issues, recommendations and judgements made by the external auditors so as to ensure the integrity of the financial statements of our Group and any announcements relating to our Group’s financial performance; review with the internal auditors the internal audit plan and their evaluation of the adequacy of our internal controls and report to our Board at least annually the adequacy and effectiveness of our Group’s internal controls, including financial, operational, compliance and IT risks and controls prior to the incorporation of such results in our annual report; review the scope and results of the external audit, and the independence and objectivity of the external auditors; monitor and review that the implementation of the external auditors’ and internal auditors’ recommendations concurred with management in relation to the adequacy of our internal controls and accounting system addressing financial, operational and compliance risks; make recommendations to our Board on proposals to our Shareholders for the appointment, re-appointment and removal of the external auditors, and approve the remuneration and terms of engagement of the external auditors; review the co-operation given by our management to our external auditors and our internal auditors, where applicable; review our Group’s compliance with such functions and duties as may be required under the relevant statutes or the Listing Manual, including such amendments made thereto from time to time; review and approve interested person transactions and review procedures thereof; review potential conflicts of interest (if any) and to set out a framework to resolve or mitigate any potential conflicts of interests;

(b)

(c)

(d)

(e)

(f)

(g)

(h) (i)

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(j) review and approve foreign exchange hedging policies implemented by our Group and conduct periodic review of foreign exchange transactions and hedging policies and procedures; review our risk management framework, with a view to providing an independent oversight on our Group’s financial reporting, the outcome of such review to be disclosed in the annual reports or, where the findings are material, announced immediately via SGXNET; investigate any matters within its terms of reference;

(k)

(l)

(m) review the policy and arrangements by which our staff may, in confidence, raise concerns about possible improprieties in matters of our business operations and financial reporting and to ensure that arrangements are in place for the independent investigations of such matter and for appropriate follow-up; and (n) undertake such other functions and duties as may be required by statute or the Listing Manual, and by such amendments made thereto from time to time.

Our Audit Committee will meet, at a minimum, on a half-yearly basis. Apart from the duties listed above, our Audit Committee shall commission and review the findings of internal investigations into matters where there is any suspected fraud or irregularity, or failure of internal controls or suspected infringement of any law, rule or regulation which has or is likely to have a material impact on our Group’s operating results and/or financial position. In the event that a member of our Audit Committee is interested in any matter being considered by our Audit Committee, he will abstain from reviewing and deliberating on that particular transaction or voting on that particular resolution. Our Audit Committee shall also commission an annual internal control audit until such time as our Audit Committee is satisfied that our Group’s internal controls are robust and effective enough to mitigate our Group’s internal control weaknesses (if any). Prior to the decommissioning of such an annual audit, our Board is required to report to the SGX-ST and the Sponsor on how the key internal control weaknesses have been rectified, and the basis for the decision to decommission the annual internal control audit. Thereafter, such audits may be initiated by our Audit Committee as and when it deems fit to satisfy itself that our Group’s internal controls remain robust and effective. Upon completion of the internal control audit, appropriate disclosure will be made via SGXNET of any material, price-sensitive internal control weaknesses and any follow-up actions to be taken by our Board. Currently, based on the internal controls established and maintained by our Group, work performed by the internal and external auditors, and reviews performed by our management and our Board, our Board, with the concurrence of our Audit Committee, is of the opinion that our internal control procedures are adequate to address financial, operational and compliance risks.

DIRECTORS’ TRAINING Our Company shall ensure that all Directors receive training, particularly on relevant laws, regulations and changing commercial risks, from time to time.

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EMPLOYEE SHARE SCHEMES
On 13 June 2013, our Shareholders approved a performance share plan known as the “PS Group Holdings Performance Share Plan” and a share option scheme known as the “PS Group Holdings Employee Share Option Scheme”, the rules of which are set out in Appendices E and F of this Offer Document, respectively. Both the PSP and the ESOS will provide eligible participants with an opportunity to participate in the equity of our Company and to motivate them towards better performance through increased dedication and loyalty. Both the PSP and ESOS form an integral and important component of our compensation plan and are designed primarily to reward and retain employees whose services are vital to the growth and performance of our Company and/or our Group. The PSP and ESOS are designed to complement each other in our Group’s efforts to reward, retain and motivate employees to achieve better performance. The aim of implementing more than one incentive plan is to increase our Group’s flexibility and effectiveness in its continuing efforts to reward, retain and motivate employees to achieve increased performance by providing our Group with a more comprehensive set of remuneration tools and further strengthen its competitiveness in attracting and retaining local and foreign talent. Unlike the ESOS whereby participants are required to pay the exercise price of the Options, the PSP allows our Group to provide an incentive for participants to achieve certain specific performance targets by awarding fully paid Shares to participants after these targets have been met. In addition, the assessment criteria for granting Option(s) under the ESOS are more general (e.g. based on length of service and general performance of our Group) and do not relate to specific performance targets imposed by our Group. In contrast, the assessment criteria for granting of Awards under the PSP will be based on specific performance targets or to impose time-based service conditions, or a combination of both.

PS GROUP HOLDINGS PERFORMANCE SHARE PLAN The PSP complies with the requirements as set out in Chapter 8, Part VIII of the Listing Manual. A summary of the rules of the PSP is set out below. Capitalised terms used throughout this section shall, unless otherwise defined in the section entitled “ Definitions ” of this Offer Document, bear the meanings as defined in Appendix E of this Offer Document. As at the date of this Offer Document, no Awards have been granted under the PSP. Objectives of the PSP The main objectives of the PSP are as follows: (a) to attract potential employees with relevant skills to contribute to our Group and to create value for Shareholders; to instil loyalty to, and a stronger identification by the Participants with the long-term prosperity of our Group; to motivate the Participants to optimise their performance standards and efficiency and to maintain a high level of contribution to our Group;

(b)

(c)

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(d) (e) to align the interests of the Participants with the interests of the Shareholders; to give recognition to the contributions made by the Participants to the success of our Group; and to retain key employees of the Company whose contributions are essential to the long-term prosperity of the Group.

(f)

The rationale for adopting the PSP is to give our Company greater flexibility to align the interests of employees, especially our key personnel, with that of our Shareholders. It is also intended to reward, retain and motivate employees to achieve superior performance which creates and enhances economic value for our Shareholders. A performance target based Award may be granted. As the Shares will be issued free under the PSP, the Participants would receive the same benefit from an Award in respect of fewer Shares as they would receive if share options were granted instead in respect of a larger number of Shares. The PSP would therefore allow our Company to provide an incentive to employees while reducing the dilutive effect to Shareholders. The Awards given to a particular Participant will be determined at the discretion of the Committee, who will take into account factors such as the Participant’s capability, scope of responsibility, skill and vulnerability to leaving the employment of our Group. In deciding on an Award to be granted to a Participant, the Committee will also consider all aspects of the compensation and/or benefits given to the Participant and such other share-based incentive schemes of our Company, if any. The Committee may also set specific criteria and performance targets for each Participant, taking into account factors such as (a) our Company’s and our Group’s business goals and directions for each financial year; (b) the Participant’s actual job scope and responsibilities; and (c) the prevailing economic conditions. Summary of the PSP The following is a summary of the rules of the PSP which should be read in conjunction with the “ Rules of the PS Group Holdings Performance Share Plan ” set out in Appendix E of this Offer Document. 1. Eligibility The following persons shall be eligible to participate in the PSP: (a) Group Employees (including Group Executive Directors) who have attained the age of 21 years on or before the date of grant of the Award; and Non-Executive Directors (including independent Directors) who have attained the age of 21 years on or before the date of grant of the Award.

(b)

Controlling Shareholders and Associates of a Controlling Shareholder who meet the above eligibility criteria are also eligible to participate in the PSP provided that (a) the participation of; and (b) the terms of each grant and the actual number of Awards granted under the PSP to, a Participant who is a Controlling Shareholder or an Associate of a Controlling Shareholder shall be approved by our independent Shareholders in a general meeting in separate resolutions for each such person, and the basis for seeking such Shareholders’ approval will be included in the circular to Shareholders. 111

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There shall be no restriction on the eligibility of any Participant to participate in any other share incentive schemes or share plans implemented or to be implemented by our Company or any other company within our Group. Subject to the Companies Act and any requirement of the SGX-ST, the terms of eligibility for participation in the PSP may be amended from time to time at the absolute discretion of the Committee. 2. Awards Awards represent the right of a Participant to receive fully paid Shares free of charge, upon the Participant achieving prescribed Performance Targets. The selection of the Participants and the number of Shares which are the subject of each Award to be granted to a Participant in accordance with the PSP shall be determined at the absolute discretion of the Committee, which shall take into account criteria such as, inter alia , the rank, scope of responsibilities, performance, years of service and potential for future development and contribution to the success of our Group. In the case of a performance-related Award, the Performance Targets will be set by the Committee depending on each individual Participant’s job scope and responsibilities. The Performance Targets to be set shall take into account both the medium and long-term corporate objectives of our Group and the individual performance of the Participant and will be aimed at sustaining long-term growth. The corporate objectives shall cover market competitiveness, business growth and productivity growth. The Performance Targets could be based on criteria such as sales growth, growth in earnings and return on investment. In addition, the Participant’s length of service with our Group, achievement of past performance targets, value-add to our Group’s performance and development and overall enhancement to Shareholder value, amongst others, will be taken into account. Awards may be granted at any time in the course of a financial year, provided that in the event that an announcement on any matter of an exceptional nature involving unpublished price sensitive information is imminent, Awards may only be vested and hence any Shares comprised in such Awards may only be delivered on or after the second Market Day from the date on which the aforesaid announcement is made. An Award letter confirming the Award will be sent to each Participant as soon as reasonably practicable after the Award is finalised, specifying, inter alia , in relation to the Award: (a) in relation to a performance-related Award, the Performance Targets and the performance period during which the prescribed Performance Targets are to be met; the number of Shares to be vested on the Participant; and the date by which the Award shall be vested.

(b) (c)

The Committee will take into account various factors when determining the method to arrive at the exact number of Shares comprised in an Award. Such factors include, but are not limited to, the current price of the Shares, the total issued share capital of our Company and the pre-determined dollar amount which the Committee decides that a Participant deserves for meeting his Performance Targets. For example, Shares may be awarded based on pre-determined dollar amounts such that the quantum of Shares comprised in Awards is 112

EMPLOYEE SHARE SCHEMES
dependent on the closing price of Shares transacted on the Market Day the Award is vested. Alternatively, the Committee may decide absolute numbers of Shares to be awarded to Participants irrespective of the price of the Shares. The Committee shall monitor the grant of Awards carefully to ensure that the size of the PSP will comply with the relevant rules of the Listing Manual. 3. Size and duration of the PSP The total number of Shares which may be delivered pursuant to the vesting of Awards on any date, when added to the aggregate number of Shares issued and/or issuable in respect of (a) all Awards granted under the PSP; (b) all Options granted under the ESOS; and (c) all other Shares issued and/or issuable under any other share-based incentive schemes or share plans of the Company, shall not exceed 15% of the total number of issued Shares (excluding treasury shares) of the Company from time to time. The Directors believe that the size of the PSP will give our Company sufficient flexibility to decide the number of Shares to be offered under the PSP. However, it does not indicate that the Committee will definitely issue Shares up to the prescribed limit. The Committee will exercise its discretion in deciding the number of Shares to be granted to each Participant under the PSP. This, in turn, will depend on and commensurate with the performance and value of the Participant to our Group. The aggregate number of Shares that are available to the Controlling Shareholders or Associates of our Controlling Shareholders under the PSP shall not exceed 25% of the total number of Shares available under the PSP. The number of Shares that are available to each Controlling Shareholder or Associate of our Controlling Shareholder under the PSP shall not exceed 10% of the Shares available under the PSP. The PSP shall continue in force at the discretion of the Committee, subject to a maximum period of 10 years commencing on the date on which the PSP is adopted by our Company in general meeting, Provided always that the PSP may continue beyond the above stipulated period with the approval of Shareholders by ordinary resolution in general meeting and of any relevant authorities which may then be required. Notwithstanding the expiry or termination of the PSP, any Awards made to Participants prior to such expiry or termination will continue to remain valid. 4. Operation of the PSP The Committee shall have the discretion to determine whether Performance Targets have been met (whether fully or partially) or exceeded and/or whether the Participant’s performance and/or contribution to our Company and/or any of our subsidiaries justifies the vesting of an Award. In making any such determination, the Committee shall have the right to make reference to the audited results of our Company or our Group, as the case may be, to take into account such factors as the Committee may determine to be relevant, such as changes in accounting methods, taxes and extraordinary events, and further, the right to amend the Performance Targets if the Committee decides that a change in the Performance Targets would be a fairer measure of performance. Awards may only be vested and consequently any Shares comprised in such Awards shall only be delivered upon the Committee being satisfied that the Participant has achieved the Performance Targets. 113

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Subject to the prevailing legislation and the provisions of the Listing Manual, our Company will be delivering Shares to Participants upon vesting of their Awards by way of an issue of new Shares or the transfer of existing Shares held as treasury shares to the Participants. In determining whether to issue new Shares or to purchase existing Shares for delivery to Participants upon the vesting of their Awards, our Company will take into account factors such as the number of Shares to be delivered, the prevailing market price of the Shares and the financial effect on our Company of either issuing new Shares or purchasing existing Shares. New Shares allotted and issued on the release of an Award shall rank in full for all entitlements, including dividends or other distributions declared or recommended in respect of the then existing Shares, the record date for which is on or after the date of issue of the new Shares or the date of transfer of treasury shares pursuant to the vesting of the Award, and shall in all other respects rank pari passu with other existing Shares then in issue. 5. Adjustments and alterations under the PSP (a) Variation of Capital If a variation in the issued ordinary share capital of our Company (whether by way of a capitalisation of profits or reserves or rights issue, capital reduction, subdivision, consolidation, distribution or otherwise) shall take place, then: (i) the class and/or number of Shares which are the subject of an Award to the extent not yet vested; and/or the class and/or number of Shares over which future Awards may be granted under the PSP,

(ii)

shall be adjusted by the Committee to give each Participant the same proportion of the equity capital of our Company as that to which he was previously entitled and, in doing so, the Committee shall determine at its own discretion the manner in which such adjustment shall be made. Unless the Committee considers an adjustment to be appropriate, the following events shall not normally be regarded as a circumstance requiring adjustment: (i) the issue of securities as consideration for an acquisition or a private placement of securities; the cancellation of issued Shares purchased or acquired by our Company by way of a market purchase of such Shares undertaken by our Company on Catalist during the period when a share purchase mandate granted by Shareholders (including any renewal of such mandate) is in force;

(ii)

(iii) the issue of Shares or other securities convertible into or with rights to acquire or subscribe for Shares to its employees pursuant to any share option scheme or share plan approved by Shareholders in general meeting, including the PSP; and (iv) any issue of Shares arising from the exercise of any warrants or the conversion of any convertible securities issued by our Company.

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Notwithstanding the provisions of the rules of the PSP: (i) the adjustment must be made in such a way that a Participant will not receive a benefit that a Shareholder does not receive; and any adjustment (except in relation to a capitalisation issue) must be confirmed in writing by the Auditors (acting only as experts and not as arbitrators) to be in their opinion, fair and reasonable.

(ii)

(b)

Modifications to the PSP Any or all the provisions of the PSP may be modified and/or altered at any time and from time to time by resolution of the Committee, provided that: (i) any modification or alteration which would be to the advantage of Participants under the PSP shall be subject to the prior approval of Shareholders in a general meeting; and no modification or alteration shall be made without due compliance with the Listing Manual and such other laws or regulations as may be applicable.

(ii)

6.

Reporting requirements Under the Listing Manual, an immediate announcement must be made on the date of grant of an Award and provide details of the grant, including the following: (a) (b) (c) (d) date of grant; market price of the Shares on the date of grant of the Award; number of Shares granted under the Award; number of Shares granted to each Director and Controlling Shareholder (and each of their Associates) under the Award, if any; and the vesting period in relation to the Award.

(e)

The following disclosures (as applicable) will be made by our Company in our annual report for so long as the PSP continues in operation: (a) (b) the names of the members of the Committee administering the PSP; in respect of the following Participants: (i) (ii) Directors of our Company; Participants who are Controlling Shareholders and their Associates; and

(iii) Participants (other than those in paragraph (b)(i) above) who have received Shares pursuant to the vesting of Awards granted under the PSP which, in aggregate, represent 5% or more of the total number of Shares available under the PSP, 115

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the following information: (aa) the name of the Participant; (bb) the aggregate number of Shares comprised in Awards which have been granted to such Participant during the financial year under review; (cc) the aggregate number of Shares comprised in Awards which have been granted to such Participant since the commencement of the PSP to the end of the financial year under review; (dd) the aggregate number of Shares comprised in Awards which have been issued and/or transferred to such Participant pursuant to the vesting of Awards under the PSP since the commencement of the PSP to the end of the financial year under review; and (ee) the aggregate number of Shares comprised in Awards which have not been vested as at the end of the financial year under review; and (c) 7. such other information as may be required by the Listing Manual or the Companies Act.

Role and composition of the Committee The Committee shall be responsible for the administration of the PSP and shall consist of Directors. As at the date of this Offer Document, the Committee comprises Ang Miah Khiang, Tan Jee Ming and Tan Chin Keong. The Committee shall have the power, from time to time, to make and vary such rules (not being inconsistent with the PSP) for the implementation and administration of the PSP as they think fit including, but not limited to: (a) (b) imposing restrictions on the number of Awards that may be vested within each financial year; and amending Performance Targets if by so doing, it would be a fairer measure of performance for a Participant or for the PSP as a whole.

In compliance with the requirements of the Listing Manual, any Participant of the PSP who is a member of the Committee shall not be involved in its deliberations in respect of Awards to be granted to or held by him or his Associate. 8. Abstention from voting Participants who are also Shareholders and are eligible to participate in this Plan must abstain from voting on any resolution relating to the participation of, or grant of Awards to the Participants. Financial effects of the PSP 1. Cost of Awards Entities shall apply Singapore Financial Reporting Standard 102 (“ FRS 102 ”) for all share-based payment transactions. Participants will receive Shares and the Awards would be accounted for as equity-settled share-based transactions, as described in the following paragraphs.

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The fair value of employee services received in exchange for the grant of the Awards will be recognised as a charge to profit or loss over the period between the grant date and the vesting date of an Award. The total amount of the charge over the vesting period is determined by reference to the fair value of each Award granted at the grant date and the number of Shares vested at the vesting date, with a corresponding credit to reserve account. Before the end of the vesting period, at each accounting year end, the estimate of the number of Awards that are expected to vest by the vesting date is subject to revision, and the impact of the revised estimate will be recognised in profit or loss with a corresponding adjustment to the reserve account. After the vesting date, no adjustment to the charge to profit or loss is made. The amount charged to profit or loss would be the same whether our Company settles the Awards by issuing new Shares or by purchasing existing Shares. The amount of the charge to profit or loss also depends on whether or not the Performance Target attached to an Award is measured by reference to the market price of the Shares. This is known as a market condition. If the Performance Target is a market condition, the probability of the Performance Target being met is taken into account in estimating the fair value of the Award granted at the grant date, and no adjustments to amounts charged to profit or loss are made if the market condition is not met. However, if the Performance Target is not a market condition, the fair value per Share of the Awards granted at the grant date is used to compute the amount to be charged to profit or loss at each accounting date, based on an assessment at that date of whether the non-market conditions would be met to enable the Awards to vest. Thus, where the vesting conditions do not include a market condition, there would be no charge to profit or loss if the Awards do not ultimately vest. 2. Share capital The PSP will result in an increase in our Company’s issued share capital where new Shares are issued to Participants. The number of new Shares issued will depend on, among others, the size of the Awards granted under the PSP. In any case, the PSP provides that the total number of Shares which may be delivered pursuant to the vesting of Awards on any date, when added to the aggregate number of Shares issued and/or issuable in respect of (a) all Awards granted under the PSP; (b) all Options granted under the ESOS; and (c) all other Shares issued and/or issuable under any other share-based incentive schemes or share plans of the Company, shall not exceed 15% of the total number of issued Shares (excluding treasury shares) of the Company from time to time. If instead of issuing new Shares to the Participants, treasury shares are transferred to Participants or our Company pays the equivalent cash value, the PSP would have no impact on our Company’s total number of issued Shares. 3. NTA The PSP will result in a charge to our Company’s profit or loss over the period from the grant date to the vesting date of the Awards. The amount of the charge will be computed in accordance with FRS 102. When new Shares are issued under the PSP, there would be no effect on the NTA. However, instead of issuing new Shares to Participants, existing Shares are purchased for delivery to Participants, or our Company pays the equivalent cash value, the NTA would be impacted by the cost of the Shares purchased or the cash payment, respectively. 4. EPS The PSP will result in a charge to earnings equivalent over the period from the grant date to the vesting date, computed in accordance with FRS 102. 117

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It should again be noted that the delivery of Shares to Participants of the PSP will generally be contingent upon the Participants meeting the prescribed Performance Targets and conditions.

PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME The ESOS complies with the requirements as set out in Chapter 8, Part VIII of the Listing Manual. Capitalised terms used throughout this section shall, unless otherwise defined in the section entitled “ Definitions ” of this Offer Document, bear the meanings as defined in Appendix F of this Offer Document. As at the date of this Offer Document, no Options have been granted under the ESOS. Objectives of the ESOS The objectives of the ESOS are as follows: (a) to motivate Participants to optimise their performance standards and efficiency and to maintain a high level of contribution to our Group; to retain key employees and Directors whose contributions are essential to the long-term growth and profitability of our Group; to instil loyalty to, and a stronger identification by Participants with the long-term prosperity of, our Group; to attract potential employees with relevant skills to contribute to our Group and to create value for our Shareholders; and to align the interests of Participants with the interests of our Shareholders.

(b)

(c)

(d)

(e)

The ESOS will provide eligible Participants with an opportunity to participate in the equity of our Company and to motivate them towards better performance through increased dedication and loyalty. The ESOS, which forms an integral and important component of our employee compensation plan, is designed to primarily reward and retain Directors and employees whose services are vital to our well-being and success. This would enable our Company to give recognition to past contributions and services as well as motivate Participants generally to contribute towards the long-term growth of our Group. Summary of the ESOS The following is a summary of the rules of the ESOS which should be read in conjunction with the “ Rules of the PS Group Holdings Employee Share Option Scheme ” set out in Appendix F of this Offer Document. 1. Participants Confirmed full time employees of our Group, Executive Directors and Non-Executive Directors (including Independent Directors) who have attained the age of 21 years on or prior to the relevant Offer Date and are not undischarged bankrupts and have not entered into a composition with their respective creditors, shall be eligible to participate in the ESOS at the absolute discretion of the Committee.

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Confirmed full time employees of our Group, Executive Directors and Non-Executive Directors who are also Controlling Shareholders or Associates of a Controlling Shareholder are also eligible to participate in the ESOS provided that (a) the participation of, and (b) the terms of any Options to be granted and the actual number of Shares to be granted under the ESOS, to a Participant who is a Controlling Shareholder or an Associate of a Controlling Shareholder shall be approved by the independent Shareholders in separate resolutions for each such person. 2. Administration The ESOS shall be administered by the Committee with powers to determine, inter alia , the following: (a) (b) (c) persons to be granted Options; number of Options to be granted; and recommendations for modifications to the ESOS.

As at the date of this Offer Document, the Committee comprises Ang Miah Khiang, Tan Jee Ming and Tan Chin Keong. The Committee will consist of Directors (including Directors or persons who may be Participants). A member of the Committee who is also a Participant must not be involved in any deliberation or decision in respect of Options granted or to be granted to him. 3. Size of the ESOS The total number of Shares over which the Remuneration Committee may grant Options on any date, when added to the number of Shares issued and issuable in respect of (a) all Options granted under the ESOS; and (b) all Awards granted under the PSP; and (c) all outstanding options or awards granted under such other share-based incentive schemes of the Company, shall not exceed 15% of the number of issued Shares (including treasury shares, as defined in the Companies Act) on the day immediately preceding the Offer Date of the Option. Our Directors believe that this limit gives us sufficient flexibility to decide upon the number of Option Shares to offer to our existing and new employees. The number of eligible participants is expected to grow over the years. Our Company, in line with its goal of ensuring sustainable growth, is constantly reviewing its position and considering the expansion of its talent pool which may involve employing new employees. The employee base, and thus the number of eligible participants will increase as a result. If the number of Options available under the ESOS is limited, our Company may only be able to grant a small number of Options to each eligible participant which may not be a sufficiently attractive incentive. Our Company is of the opinion that it should have sufficient number of Options to offer to new employees as well as to existing ones. The number of Options offered must also be significant to serve as a meaningful reward for contributions to our Group. However, it does not necessarily mean that the Committee will definitely issue Option Shares up to the prescribed limit. The Committee shall exercise its discretion in deciding the number of Option Shares to be granted to each employee which will depend on the performance and value of the employee to our Group.

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4. Maximum entitlements The aggregate number of Shares comprised in any Option to be offered to a Participant under the ESOS shall be determined at the absolute discretion of the Committee, which shall take into account (where applicable) criteria such as rank, past performance, years of service, potential for future development of that Participant. The aggregate number of Shares in respect of which Options may be granted to the Controlling Shareholders or Associates of the Controlling Shareholders under the ESOS shall not exceed 25% of the total number of Shares available under the ESOS. The aggregate number of Shares in respect of which Options may be granted to any individual Controlling Shareholders or Associate of a Controlling Shareholder under the ESOS shall not exceed 10% of the total number of Shares available under the ESOS. 5. Options, exercise period and exercise price The Options that are granted under the ESOS may have exercise prices that are, at the Committee’s discretion, set at a price (the “ Market Price ”) equal to the average of the last dealt prices for the Shares on the Official List of Catalist for the five consecutive Market Days immediately preceding the relevant date of grant of the relevant Option; or at a discount to the Market Price (subject to a maximum discount of 20%). Options which are fixed at the Market Price (“ Market Price Option ”) may be exercised after the first anniversary of the date of grant of that Option while Options exercisable at a discount to the Market Price (“ Discounted Option ”) may only be exercised after the second anniversary from the date of grant of the Option. Options granted under the ESOS will expire upon the tenth anniversary of the date of grant of that Option. 6. Grant of Options Under the rules of the ESOS, there are no fixed periods for the grant of Options. As such, offers for the grant of Options may be made at any time at the discretion of the Committee. However, no Option shall be granted during the period of 30 days immediately preceding the date of announcement of our Company’s interim or final results (as the case may be). In addition, in the event that an announcement on any matter of an exceptional nature involving unpublished price sensitive information is imminent, offers may only be made after the second Market Day from the date on which the aforesaid announcement is made. 7. Termination of Options Special provisions in the rules of the ESOS deal with the lapse or earlier exercise of Options in circumstances which include the termination of the Participant’s employment in our Group, the bankruptcy of the Participant, the death of the Participant, a take-over of our Company and the winding-up of our Company. 8. Acceptance of Options The grant of Options shall be accepted within 30 days from the date of offer. Offers of Options made to Grantees, if not accepted by the closing date, will lapse. Upon acceptance of the offer, the Grantee must pay our Company a consideration of S$1.00.

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9. Rights of Shares arising from the exercise of Options Shares arising from the exercise of Options are subject to the provisions of the Memorandum and Articles of Association of our Company. The Shares so allotted will upon issue rank pari passu in all respects with the then existing issued Shares, save for any dividend, rights, allotments or distributions, the record date for which is prior to the relevant exercise date of the Option. For such purposes, “record date” means the date as at the close of business on which our Shareholders must be registered in order to participate in any dividends, rights, allotments or other distributions (as the case may be). 10. Duration of the ESOS The ESOS shall continue in operation for a maximum duration of 10 years commencing on the date on which the ESOS is adopted by our Company in general meeting and may be continued for any further period thereafter with the approval of our Shareholders by ordinary resolution in general meeting and of any relevant authorities which may then be required. 11. Abstention from voting Shareholders who are eligible to participate in the ESOS are to abstain from voting on any resolution of Shareholders relating to the ESOS. Grant of Discounted Options Discounted Options will only be granted to deserving employees whose performance has been consistently good and/or whose future contributions to our Group will be invaluable. The ability to offer Discounted Options will operate as a means to recognise the performance of Participants as well as to motivate them to continue to excel while encouraging them to focus on improving the profitability and return of our Group to a level that benefits our Shareholders when these are eventually reflected through an appreciation of our Share price. Discounted Options would be perceived in a more positive light by the Participants, inspiring them to work hard and produce results in order to be offered Discounted Options as only employees who have made significant contributions to the success and development of our Group would be granted Discounted Options. The flexibility to grant Discounted Options is also intended to cater to situations where the stock market performance has overrun the general market conditions. In such events, the Committee will have absolute discretion to: (a) grant Options set at a discount to the Market Price of a Share (subject to a maximum limit of 20%); and determine the Participants to whom, and the Options to which, such reduction in exercise prices will apply.

(b)

In determining whether to give a discount and the quantum of the discount, the Committee shall be at liberty to take into consideration factors including the performance of our Company, our Group, the performance of the participant concerned, the contribution of the Participant to the success and development of our Group and the prevailing market conditions. At present, our Company foresees that Discounted Options may be granted principally in the following circumstances: (a) firstly, where it is considered more effective to reward and retain talented employees by way of a Discounted Option rather than a Market Price Option. This is to reward the outstanding 121

EMPLOYEE SHARE SCHEMES
performers who have contributed significantly to our Group’s performance and the Discounted Option serves as additional incentives to such Group employees. Options granted by our Company on the basis of Market Price may not be attractive and realistic in the event of an overly buoyant market and inflated share prices. Hence, during such a period, the ability to offer Discounted Options would allow our Company to grant Options on a more realistic and economically feasible basis. Furthermore, Discounted Options will give an opportunity to our Group employees to realise some tangible benefits even if external events cause the Share price to remain largely static; and (b) secondly, where it is more meaningful and attractive to acknowledge a Participant’s achievements through a Discounted Option rather than paying him a cash bonus. For example, Discounted Options may be used to compensate employees and to motivate them during economic downturns when wages (including cash bonuses and annual wage supplements) are frozen or cut, or they could be used to supplement cash rewards in lieu of larger cash bonuses or annual wage supplements. Accordingly, it is possible that meritbased cash bonuses or rewards may be combined with grants of Market Price Options or Discounted Options, as part of eligible employees’ compensation packages. The ESOS will provide our Group employees with an incentive to focus more on improving the profitability of our Group thereby enhancing Shareholder value when these are eventually reflected through the price appreciation of our Shares after the vesting period.

The Committee will have the absolute discretion to grant Discounted Options, to determine the level of discount (subject to a maximum discount of 20% of the Market Price) and the Grantees to whom, and the Options to which, such discount in the exercise price will apply provided that our Shareholders in general meeting shall have authorised, in a separate resolution, the making of offers and grants of Options under the ESOS at a discount not exceeding the maximum discount as aforesaid. Such Discounted Options may only be exercisable after two years from the date of grant. Our Company may also grant Options without any discount to the Market Price. Additionally, our Company may, if it deems fit, impose conditions on the exercise of the Options (whether such Options are granted at the Market Price or at a discount to the Market Price), such as restricting the number of Shares for which the Option may be exercised during the initial years following its vesting. Financial effects of the ESOS Any Options granted under the ESOS would have a fair value. Where such options are granted at a consideration below their fair value, there will be a cost to our Company, the amount of which will depend on whether the Options are granted at the Market Price or at a discount to the Market Price. The cost to our Company of granting Options under the ESOS would be as follows: (a) the exercise of an Option at a discounted exercise price would translate into a reduction of the proceeds from the exercise of such options, as compared to the proceeds that our Company would have received from such exercise had the exercise been made at the prevailing Market Price of our Shares. Such reduction of the exercise proceeds would represent the monetary cost to our Company of granting Options with a discounted exercise price; as the monetary cost of granting Options with a discounted exercise price is borne by our Company, the earnings of our Company would effectively be reduced by an amount corresponding to the reduced interest earnings that our Company would have received from

(b)

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the difference in proceeds from an exercise price with no discount versus the discounted exercise price. Such reduction would, accordingly, result in the dilution of our Company’s EPS; (c) the effect of the issue and allotment of new Shares upon the exercise of Options on our Company’s NAV per Share is accretive if the exercise price is above the NAV per Share, but dilutive otherwise; and the grant of Options under the ESOS will have an impact on our Company’s reported profit because under FRS 102, share-based payments require the recognition of an expense in respect of Options granted under the ESOS. The expense will be based on the fair value of the Options at the date of grant and will be recognised over the vesting period.

(d)

The financial effects discussed above in (a), (b) and (c) would only materialise upon the exercise of the relevant Options. The cost of granting Options discussed in (d) above would be recognised in the financial statements even if the Options discussed in (d) above are not exercised. Share options have value because the option to buy a company’s share for a fixed price during an extended future time period is a valuable right, even if there are restrictions attached to such an option. As our Company is required to account for share-based awards granted to our employees, the cost of granting Options will affect our financial results as this cost to our Company would be required to be charged to our Company’s profit or loss commencing from the time Options are granted. Subject as aforesaid, as and when Options are exercised, the cash inflow will add to the net tangible assets of our Company and its share capital base will grow. Where Options are granted with subscription prices that are set at a discount to the Market Prices for our Shares prevailing at the time of the grant of such Options, the amount of the cash inflow to our Company on the exercise of such Options would be diminished by the quantum of the discount given, as compared with the cash inflow that would have been receivable by our Company had the Options been granted at the Market Price of our Shares prevailing at the time of the grant. The grant of Options will have an impact on our Company’s reported profit under the accounting rules in FRS 102. The cost to our Company in granting an Option would vary depending on the number of Options granted pursuant to the ESOS, whether these Options are granted at Market Price or at a discount to the Market Price and the validity period of the Options. Generally, a greater discount and a longer validity period for an Option will result in a higher potential cost to our Company.

RATIONALE FOR PARTICIPATION BY THE CONTROLLING SHAREHOLDERS AND ASSOCIATES OF OUR CONTROLLING SHAREHOLDERS IN THE PSP AND THE ESOS Our Company acknowledges that the services and contributions of employees who are Controlling Shareholders or Associates of our Controlling Shareholders are important to the development and success of our Group. The extension of the PSP and the ESOS to confirmed full-time employees who are Controlling Shareholders or Associates of our Controlling Shareholders allows our Group to have a fair and equitable system to reward employees who have actively contributed to the progress and success of our Group. The participation of our Controlling Shareholders or the Associates of the Controlling Shareholders in the PSP and the ESOS will serve both as a reward to them for their dedicated services to our Group and a motivation for them to take a long-term view of our Group.

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Although participants who are Controlling Shareholders or Associates of our Controlling Shareholders may already have shareholding interests in our Company, the extension of the PSP and the ESOS to include them ensures that they are equally entitled, with the other employees of our Group who are not Controlling Shareholders or Associates of our Controlling Shareholders, to take part and benefit from this system of remuneration. We are of the view that a person who would otherwise be eligible should not be excluded from participating in the PSP and the ESOS solely by reason that he/she is a Controlling Shareholder or an Associate of our Controlling Shareholder(s). The specific approval of our independent Shareholders is required for the proposed participation of any Controlling Shareholder and/or their Associates in the PSP and the ESOS as well as any specific grant thereunder to such persons. Separate resolutions must be passed for each such person and, in the case of a grant, the resolution must state the actual number of Shares comprised in the specific grant and its applicable terms, as well as the Company’s rationale for such proposal. On the foregoing basis, we are of the view that there are sufficient safeguards against abuse resulting from the participation of the Controlling Shareholders and/or their Associates in the PSP and the ESOS. It is proposed that Teo Choon Hock and Kwek Keng Seng, both of whom are Controlling Shareholders, and Teo Yong Tat, who is an Associate of Teo Choon Hock, and all of whom are also employees of our Group, be entitled to participate in the PSP and the ESOS. The shareholding interests of Teo Choon Hock and Kwek Keng Seng in the issued share capital of our Company as at the Latest Practicable Date are disclosed in the section entitled “ Shareholders ” of this Offer Document. As at the Latest Practicable Date, Teo Yong Tat does not hold any Shares. Rationale for participation of Teo Choon Hock Teo Choon Hock is the Executive Chairman of our Company and oversees our performance and establishes the strategic goals and direction of our Group. He also formulates our Group’s policies in relation to quality control, purchasing, marketing and finance. Teo Choon Hock is one of the founding members of PS Fasteners and has been with our Group for more than 20 years. As our Executive Chairman, Teo Choon Hock plays a pivotal role in providing strategic leadership, business and management direction, business networks and market contacts to our Group. Our Directors believe that the potential contribution that may be made by Teo Choon Hock to our Group’s future development will be substantial. Our Directors are of the view that including Teo Choon Hock in the PSP and the ESOS will give due recognition for his services and contributions to the growth and development of our Group. The extension of the PSP and the ESOS to Teo Choon Hock is consistent with our Company’s objectives to motivate our employees to achieve and maintain a high level of performance and contribution which is vital to the success of the Company. Although Teo Choon Hock already has a shareholding interest in the Company, the extension of the PSP and the ESOS to him will ensure that he is equally entitled, with the other employees who are not Controlling Shareholders, to take part in and benefit from this system of remuneration, thereby enhancing his long-term commitment to our Company.

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Rationale for participation of Kwek Keng Seng Kwek Keng Seng is our Managing Director, and he assists our Executive Chairman with the overall management of our Group’s business operations. Kwek Keng Seng manages our day-to-day operations in the areas of sales and warehouse operations, formulating the sales strategies and setting sales targets for our Group as well as overseeing the storage and logistics management of our products. Kwek Keng Seng is one of the founding members of PS Fasteners and has been with our Group for more than 20 years. As our Managing Director, he oversees the overall management of our Group, and with his wealth of experience and industry contacts, he has also been instrumental in the Group’s expansion. Kwek Keng Seng’s expertise and contribution to our Group has been invaluable since inception and his continuing contribution is an important factor for the further growth and success of our Group. Our Directors are of the view that including Kwek Keng Seng in the PSP and the ESOS will give due recognition for his services and contributions to the growth and development of our Group. The extension of the PSP and the ESOS to Kwek Keng Seng is consistent with our Company’s objectives to motivate our employees to achieve and maintain a high level of performance and contribution which is vital to the success of our Group. Although Kwek Keng Seng already has a shareholding interest in the Company, the extension of the PSP and the ESOS to him will ensure that he is equally entitled, with the other employees who are not Controlling Shareholders, to take part in and benefit from this system of remuneration, thereby enhancing his long-term commitment to our Company. Rationale for participation of Teo Yong Tat Teo Yong Tat is our Business Development Manager. He is responsible for establishing and/or maintaining relationships with our customers and suppliers, developing business opportunities in existing and potential markets as well as reviewing quotations for and confirming orders with customers. Teo Yong Tat has been with our Group since 2011 and has played an important role in improving our Group’s IT infrastructure which enabled us to have a faster turnaround time in processing our customers’ orders. He continues to provide invaluable support to our Company to assist in overseeing our sales operations and expansion plans. Our Directors consider it crucial to provide incentives which will instill in employees a sense of commitment to our Company. Although Teo Yong Tat is the son of Teo Choon Hock, he does not have any beneficial interest in the shareholding interests of Teo Choon Hock nor does he have any direct shareholding interest in the Company. The extension of the PSP and the ESOS to him will ensure that he is equally entitled, with other employees who are not Controlling Shareholders or Associates of Controlling Shareholders, to take part in and benefit from this system of remuneration, thereby enhancing his long-term commitment to our Company. Acknowledgement and approval by subscribers of Placement Shares The participation in the PSP and the ESOS by Teo Choon Hock, Kwek Keng Seng and Teo Yong Tat will take place only after the listing of our Company on Catalist. By subscribing for the Placement Shares, investors shall be deemed to have acknowledged and approved the participation by each of Teo Choon Hock, Kwek Keng Seng and Teo Yong Tat in each of the PSP and the ESOS. Nonetheless, under the Listing Manual, the specific grant of Awards or Options to

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each of Teo Choon Hock, Kwek Keng Seng and Teo Yong Tat and any other Controlling Shareholders or their Associates will have to be approved in separate resolutions by independent Shareholders in general meeting.

RATIONALE FOR PARTICIPATION BY OUR NON-EXECUTIVE DIRECTORS (INCLUDING INDEPENDENT DIRECTORS) IN THE PSP AND THE ESOS While the PSP and the ESOS cater principally to Group Employees, it is recognised that there are other persons who make significant contributions to our Group through their close working relationships with our Group, even though they are not employed within our Group. Such persons include the Non-Executive Directors (including Independent Directors). The Non-Executive Directors are persons from different professions and working backgrounds, bringing to our Group their wealth of knowledge, business expertise and contacts in the business community. They play an important role in helping our Group shape its business strategy by allowing our Group to draw on their diverse backgrounds and working experience. Although our Non-Executive Directors are not involved in the day-to-day running of our operations, they play an invaluable role in furthering the business interests of our Group by contributing their experience and expertise. It is crucial for our Group to attract, retain and incentivise the Non-Executive Directors. By aligning the interests of the Non-Executive Directors with the interests of Shareholders, our Company aims to inculcate a sense of commitment on the part of the Non-Executive Directors towards serving the short and long-term objectives of our Group. The participation by Non-Executive Directors in the PSP and the ESOS will provide our Company with a further avenue to acknowledge and recognise their services and contributions to our Group as it may not always be possible to compensate them fully or appropriately by increasing the directors’ fees or other forms of cash payment. For instance, the Non-Executive Directors may bring strategic or other value to our Company which may be difficult to quantify in monetary terms. The grant of Awards and/or Options to Non-Executive Directors will allow our Company to attract and retain experienced and qualified persons from different professional backgrounds to join our Company as Non-Executive Directors, and to motivate existing Non-Executive Directors to take extra efforts to promote the interests of our Company and/or our Group. However, as their services and contributions cannot be measured in the same way as the full-time employees of our Group, for the purpose of assessing the contributions of the Non-Executive Directors, the Committee will propose a performance framework comprising mainly non-financial performance measurement criteria, such as the extent of involvement and responsibilities shouldered by the relevant Non-Executive Director, taking into consideration, inter alia , his performance and contributions to the success and development of our Group, his committee memberships in our Group, as well as his contribution, which includes contribution of his experience in the areas of overall business strategies, risk management and investment decisions. In order to minimise any potential conflict of interests and to not compromise the independence of the Non-Executive Directors, we intend to grant only a nominal number of Awards and/or Options to such Non-Executive Directors. The Committee may also decide that no Awards/Options shall be made in any financial year or no Award/Option may be granted at all.

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EXCHANGE CONTROLS
There are no exchange control restrictions in Singapore on the repatriation of capital and the remittance of profit into or out of Singapore by or to our Group companies in Singapore.

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CLEARANCE AND SETTLEMENT
Upon listing and quotation on Catalist, our Shares will be traded under the book-entry settlement system of CDP, and all dealings in and transactions of our Shares through Catalist will be effected in accordance with the terms and conditions for the operation of Securities Accounts with CDP, as amended, modified or supplemented from time to time. Our Shares will be registered in the name of CDP or its nominee and held by CDP for and on behalf of persons who maintain, either directly or through Depository Agents, Securities Accounts with CDP. Persons named as direct Securities Account holders and Depository Agents in the Depository Register maintained by CDP, rather than CDP itself, will be treated, under our Articles of Association and the Companies Act, as members of our Company in respect of the number of Shares credited to their respective Securities Accounts. Persons holding our Shares in Securities Accounts with CDP may withdraw the number of Shares they own from the book-entry settlement system in the form of physical share certificates. Such share certificates will, however, not be valid for delivery pursuant to trades transacted on Catalist, although they will be prima facie evidence of title and may be transferred in accordance with our Articles. A fee of S$10 for each withdrawal of 1,000 Shares or less and a fee of S$25 for each withdrawal of more than 1,000 Shares is payable upon withdrawing our Shares from the book-entry settlement system and obtaining physical share certificates. In addition, a fee of S$2 or such other amount as our Directors may decide, is payable to the share registrar for each share certificate issued, and a stamp duty of S$0.20 per S$100 or part thereof of the last transacted price is payable where it is withdrawn in the name of a third party. Persons holding physical share certificates who wish to trade on Catalist must deposit with CDP their share certificates together with the duly executed and stamped instruments of transfer in favour of CDP, and have their respective Securities Accounts credited with the number of Shares deposited before they can effect the desired trades. A fee of S$10 is payable upon the deposit of each instrument of transfer with CDP. The above fees may be subject to such charges as may be in accordance with CDP’s prevailing policies or the current tax policies that may be in force in Singapore from time to time. Transactions in our Shares under the book-entry settlement system will be reflected by the seller’s Securities Account being debited with the number of Shares sold and the buyer’s Securities Account being credited with the number of Shares acquired. No transfer of stamp duty is currently payable for our Shares that are settled on a book-entry basis. A Singapore clearing fee for trades in our Shares on Catalist is payable at the rate of 0.04% of the transaction value subject to a maximum of S$600 per transaction. The clearing fee, instrument of transfer deposit fee and share withdrawal fee may be subject to GST at the prevailing rate of 7.0% (or such other rate prevailing from time to time). Dealings of our Shares will be carried out in Singapore dollars and will be effected for settlement on CDP on a scripless basis. Settlement of trades on a normal “ready” basis on Catalist generally takes place on the third Market Day following the transaction date, and payment for the securities is generally settled on the following business day. CDP holds securities on behalf of investors in Securities Accounts. An investor may open a direct account with CDP or a sub-account with a CDP Depository Agent. The CDP Depository Agent may be a member company of the SGX-ST, bank, merchant bank or trust company.

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GENERAL AND STATUTORY INFORMATION
INFORMATION ON DIRECTORS AND EXECUTIVE OFFICERS 1. None of our Directors, Executive Officers and Controlling Shareholders: (a) has, at any time during the last ten years, had an application or a petition under any bankruptcy laws of any jurisdiction filed against him or against a partnership of which he was a partner at the time when he was a partner or at any time within two years from the date he ceased to be a partner; has, at any time during the last ten years, had an application or a petition under any law of any jurisdiction filed against an entity (not being a partnership) of which he was a director or an equivalent person or a key executive, at the time when he was a director or an equivalent person or a key executive of that entity or at any time within two years from the date he ceased to be a director or an equivalent person or a key executive of that entity, for the winding up or dissolution of that entity or, where that entity is the trustee of a business trust, that business trust, on the ground of insolvency; has any unsatisfied judgement against him; has ever been convicted of any offence, in Singapore or elsewhere, involving fraud or dishonesty which is punishable with imprisonment, or has been the subject of any criminal proceedings (including any pending criminal proceedings of which he is aware) for such purpose; has ever been convicted of any offence, in Singapore or elsewhere, involving a breach of any law or regulatory requirement that relates to the securities or futures industry in Singapore or elsewhere, or has been the subject of any criminal proceedings (including any pending criminal proceedings of which he is aware) for such breach; has, at any time during the last ten years, had judgement entered against him in any civil proceedings in Singapore or elsewhere involving a breach of any law or regulatory requirement that relates to the securities or futures industry in Singapore or elsewhere, or a finding of fraud, misrepresentation or dishonesty on his part, nor has he been the subject of any civil proceedings (including any pending civil proceedings of which he is aware) involving an allegation of fraud, misrepresentation or dishonesty on his part; has ever been convicted in Singapore or elsewhere of any offence in connection with the formation or management of any entity or business trust; has ever been disqualified from acting as a director or an equivalent person of any entity (including the trustee of a business trust), or from taking part directly or indirectly in the management of any entity or business trust; has ever been the subject of any order, judgement or ruling of any court, tribunal or governmental body permanently or temporarily enjoining him from engaging in any type of business practice or activity; has ever, to his knowledge, been concerned with the management or conduct, in Singapore or elsewhere, of affairs of: (i) any corporation which has been investigated for a breach of any law or regulatory requirement governing corporations in Singapore or elsewhere; 129

(b)

(c) (d)

(e)

(f)

(g)

(h)

(i)

(j)

GENERAL AND STATUTORY INFORMATION
(ii) any entity (not being a corporation) which has been investigated for a breach of any law or regulatory requirement governing such entities in Singapore or elsewhere;

(iii) any business trust which has been investigated for a breach of any law or regulatory requirement governing business trusts in Singapore or elsewhere; or (iv) any entity or business trust which has been investigated for a breach of any law or regulatory requirement that relates to the securities or futures industry in Singapore or elsewhere, in connection with any matter occurring or arising during the period when he was so concerned with the entity or business trust; or (k) has been the subject of any current or past investigation or disciplinary proceedings, or has been reprimanded or issued any warning, by the Authority or any other regulatory authority, exchange, professional body or governmental agency, whether in Singapore or elsewhere.

2. 3.

There is no shareholding qualification for Directors under our Articles. No sum or benefit has been paid or is agreed to be paid to any Director or expert, or to any firm in which such Director or expert is a partner or any corporation in which such Director or expert holds shares or debentures, in cash or shares or otherwise for services rendered by him or by such firm or corporation in connection with the promotion or formation of our Company.

SHARE CAPITAL 4. As at the Latest Practicable Date, there is only one class of shares in the capital of our Company. There are no founder, management or deferred shares. The rights and privileges attached to our Shares are stated in our Articles. Save as disclosed in the sections entitled “ Share Capital ” and “ Restructuring Exercise ” of this Offer Document, there are no changes in the issued and paid-up share capital of our Company and our subsidiary within the last three years preceding the Latest Practicable Date. Save as disclosed in the sections entitled “ Share Capital ” and “ Restructuring Exercise ” of this Offer Document, no shares in, or debentures of, our Company or our subsidiary have been issued, or are proposed to be issued, as fully or partly paid for cash or for a consideration other than cash, during the last three years preceding the date of lodgement of this Offer Document. Except pursuant to the ESOS, no person has been, or is entitled to be, given an option to subscribe for any shares in or debentures of our Company or our subsidiary. Apart from the PSP and the ESOS, our Company does not have any arrangement that involves the issue or grant of options or shares to the employees of our Group.

5.

6.

7.

8.

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GENERAL AND STATUTORY INFORMATION
MATERIAL CONTRACTS 9. The following contract, not being a contract entered into in the ordinary course of business, has been entered into by our Company and our subsidiary within the two years preceding the date of lodgement of this Offer Document and is or may be material: (a) share swap agreement dated 30 May 2013 entered into between our Company, Teo Choon Hock and Kwek Keng Seng, pursuant to which our Company acquired from Teo Choon Hock and Kwek Keng Seng the entire issued and paid-up share capital of PS Fasteners held by them, comprising an aggregate of 400,016 ordinary shares for a total consideration of S$6,803,522 based on the audited NTA of PS Fasteners as at 31 December 2012. The purchase consideration was satisfied by the issue and allotment of an aggregate of 6,803,522 Shares in the capital of our Company at an issue price of S$1.00 per Share, credited as fully paid-up and was arrived at on a willing buyer willing seller basis.

LITIGATION 10. As at the Latest Practicable Date, our Group is not engaged in any legal or arbitration proceedings, including those which are pending or known to be contemplated, which may have or have had in the last 12 months before the date of lodgement of this Offer Document, a material effect on our Group’s financial position or profitability.

MANAGEMENT AND PLACEMENT ARRANGEMENTS 11. Pursuant to the Management Agreement, our Company appointed UOB to sponsor and manage the Placement. UOB will receive a management fee from our Company for such services rendered.

12. Pursuant to the Placement Agreement, our Company appointed UOB as the Placement Agent to subscribe and/or procure subscribers for the Placement Shares for a placement commission and brokerage of 3.0% of the Placement Price for each Placement Share, to be paid by our Company. UOB may, at its absolute discretion, appoint one or more subplacement agents for the Placement Shares. 13. Subscribers of the Placement Shares may be required to pay a brokerage fee of up to 1.0% of the Placement Price to the Placement Agent (and the prevailing GST, if applicable). 14. Subject to the consent of the SGX-ST being obtained, if necessary, UOB shall be entitled by notice in writing to our Company, to rescind or terminate the Management Agreement, if at any time prior to the date and time of the commencement of trading of our Shares on Catalist: (a) the issue of a Stop Order by the Authority, the SGX-ST (acting as agent on behalf of the Authority) or other competent authority in accordance with Section 242 of the SFA (notwithstanding that a supplementary or replacement offer document is subsequently registered with the SGX-ST pursuant to Section 241 of the SFA); or

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GENERAL AND STATUTORY INFORMATION
(b) there shall come to the knowledge of UOB any material breach by the Company of any of the warranties, representations, covenants or undertakings given by the Company in the Management Agreement or that any of the warranties or undertakings in the Management Agreement is untrue or incorrect in any material respect; or any occurrence of a “specified event” comes to the knowledge of the UOB, and “specified event” means an event occurring after the date of the Management Agreement and prior to the date of the close of the Application List which, if it had occurred before the date of the Management Agreement, would have rendered any of the representations, warranties or undertakings contained in the Management Agreement, untrue or incorrect in any material respect; or there shall have been, since the date of the Management Agreement: (i) any material adverse change, or any development or event involving a prospective material adverse change, in the condition (business, trading, financial or otherwise), performance or general affairs of any of the Group companies or the Group as a whole; or any introduction or prospective introduction of or any change or prospective change in any legislation, regulation, order, policy, rule, guideline or directive (whether or not having the force of law and including, without limitation, any directive, notice or request issued by the Authority, the Accounting and Corporate Regulatory Authority, the Securities Industry Council of Singapore, the SGX-ST or any other relevant authorities) in Singapore or elsewhere or in the interpretation or application thereof by any court, government body, regulatory authority or other competent authority in Singapore or elsewhere that has or is reasonably expected to have a material adverse effect or prospective material adverse effect in the condition, performance, general affairs, prospects, future plans and trends of any of the Group companies, financial or otherwise, other than as disclosed in the Preliminary Offer Document or, as the case may be, the Offer Document; or

(c)

(d)

(ii)

(iii) any material adverse change, or any development involving a prospective material adverse change or any crisis in local, national, regional or international political, industrial, legal, financial, monetary or economic conditions, taxation or exchange controls (including without limitation, to the conditions in the stock market, foreign exchange market, inter-bank market or interest rates or money market, in Singapore or any other jurisdiction, or the imposition of any moratorium, suspension or material restriction on trading in securities generally on the SGX-ST (including Catalist) due to exceptional financial circumstances or otherwise) or a combination of any such changes or development or crisis or deterioration thereof; or (iv) any imminent threat or occurrence of any local, national, regional or international outbreak or escalation of hostilities, insurrection, terrorist attacks, or armed conflict whether or not war has been declared or not (whether or not involving financial markets in any jurisdiction); or (v) any regional or local outbreak of disease that may have a material adverse effect on the financial markets; or

132

GENERAL AND STATUTORY INFORMATION
(vi) any other occurrence of any nature whatsoever, which event or events shall in the reasonable opinion of UOB (1) result or be likely to result in a material adverse fluctuation or material adverse conditions in the stock market in Singapore or elsewhere; or (2) be likely to materially prejudice the success of the Placement (whether in the primary market or in respect of dealings in the secondary market); or (3) make it impracticable, inadvisable, inexpedient or not commercially viable to proceed with any of the transactions contemplated in the Management Agreement or the Placement Agreement; or (4) be likely to have a material adverse effect on the business, trading position, operations or prospects of the Company or of the Group as a whole; or (5) be such that no reasonable sponsor, underwriter or placement agent would have entered into the Management Agreement or the Placement Agreement; or (6) results or is likely to result in the issue of a Stop Order by the SGX-ST (acting as agent on behalf of the Authority) or other competent authority pursuant to the SFA; or (7) make it non-commercial or otherwise contrary to or outside the usual commercial practices of sponsoring, underwriting or placement in Singapore for UOB to observe or perform or be obliged to observe or perform the terms of the Management Agreement or the Placement Agreement. (e) without limiting the generality of the foregoing, if it comes to the notice of UOB (i) any statement contained in this Offer Document or the Application Forms which in the reasonable opinion of UOB has become untrue, incorrect or misleading in any material respect; or (ii) circumstances or matters have arisen or have been discovered, which would, if this Offer Document was to be issued at that time, constitute in the reasonable opinion of UOB, a material omission of information, and our Company fails to lodge a supplementary or replacement offer document within a reasonable time after being aware of such material misrepresentation or omission or fails to promptly take such steps as UOB may reasonably require to inform investors of the lodgement of such supplementary or replacement offer document. In such event, UOB reserves the right, at its absolute discretion, to inform the SGX-ST and to cancel the Placement and (if applicable) subject to the terms and conditions of the Offer Document, any application monies received in connection with the Placement will be refunded (without interest or any share of revenue or other benefit arising therefrom) to the applicants for the Placement Shares in accordance with the terms and conditions of the Offer Document. the Placement Agreement is terminated for whatever reason.

(f)

15. In the event of any termination of the Management Agreement or the Placement Agreement for any cause, our Company shall terminate the Placement, and shall in this regard authorise UOB to act on behalf of our Company and to do such acts and things as it may deem necessary or advisable to terminate to cancel the Placement. 16. The Placement Agreement is conditional upon, among other things, the Management Agreement not having been terminated or rescinded pursuant to the provisions of the Management Agreement.

MISCELLANEOUS 17. There has been no previous issue of Shares by our Company or offer for sale of our Shares to the public within the two years preceding the date of this Offer Document.

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GENERAL AND STATUTORY INFORMATION
18. There has not been any public takeover offer by a third party in respect of our Company’s Shares or by our Company in respect of shares of another corporation or units of a business trust which has occurred between 1 January 2012 and the Latest Practicable Date. 19. Save as disclosed in the sub-section entitled “ Management and Placement Arrangements ” under this section of this Offer Document, no commission, discount or brokerage has been paid or other special terms granted within the two years preceding the Latest Practicable Date or is payable to any Director, promoter, expert, proposed director or any other person for subscribing or agreeing to subscribe or procuring or agreeing to procure subscriptions for any shares in, or debentures of, our Company or our subsidiary. 20. No expert is employed on a contingent basis by our Group or has an interest, directly or indirectly, in the promotion of, or in any property or assets which have, within the two years preceding the Latest Practicable Date, been acquired or disposed of by or leased to our Company or our subsidiary or are proposed to be acquired or disposed of by or leased to our Company or our subsidiary. 21. Application monies received by our Company in respect of successful applications (including successful applications which are subsequently rejected) will be placed in a separate non-interest bearing account with UOB (the “ Receiving Bank ”). Any refund of all or part of the application monies to unsuccessful or partially successful applicants will be made without any interest or any share of revenue or any other benefit arising therefrom. 22. Save as disclosed in this Offer Document, our Directors are not aware of any event which has occurred between 1 January 2013 and the Latest Practicable Date which may have a material effect on the financial position and results of our Group. 23. Save as disclosed in this Offer Document, the financial condition and operations of our Group are not likely to be affected by any of the following: (a) known trends or demands, commitments, events or uncertainties that will result in or are reasonably likely to result in our Group’s liquidity increasing or decreasing in any material way; material commitments for capital expenditure; unusual or infrequent events or transactions or any significant economic changes that may materially affect the amount of reported income from operations; and the business and financial prospects and any significant recent trends in production, sales and inventory, and in the costs and selling prices of products and services and known trends or uncertainties that have had or that we reasonably expect will have a material favourable or unfavourable impact on revenues, profitability, liquidity, capital resources or operating income or that would cause financial information disclosed to be not necessarily indicative of the future operating results or financial condition of our Group.

(b) (c)

(d)

24. Details, including the name, address and professional qualifications including membership in a professional body of the auditors of our Company since the incorporation of our Company are as follows:

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GENERAL AND STATUTORY INFORMATION
Name, professional qualification and address Ernst & Young LLP/ Public Accountants and Chartered Accountants/ One Raffles Quay, North Tower, Level 18, Singapore 048583 Partner-in-charge/ Professional qualification Adrian Koh Hian Yan/ a practising member of the Institute of Singapore Chartered Accountants

Professional body Institute of Singapore Chartered Accountants

We currently have no intention of changing our auditors after the listing of our Company on Catalist.

CONSENTS 25. Ernst & Young LLP, the Independent Auditors and Reporting Accountants, has given and has not withdrawn its written consent to the issue of this Offer Document with the inclusion herein of: (a) (b) its name and all references thereto; and “ Audited Combined Financial Statements of PS Group Holdings Ltd. And Its Subsidiary For The Financial Years Ended 31 December 2010, 2011 And 2012 ”, annexed to the Offer Document as Appendix A,

in the form and context in which they are included in this Offer Document and to act in such capacity in relation to this Offer Document. 26. UOB, the Sponsor and Placement Agent, has given and has not withdrawn its written consent to the issue of this Offer Document with the inclusion herein of its names and references thereto in the form and context in which they appear in this Offer Document and to act in such capacity in relation to this Offer Document. 27. Each of the Solicitors to the Placement, the Solicitors to the Sponsor and Placement Agent, the Share Registrar and Share Transfer Office, the Principal Bankers and the Receiving Banker do not make, or purport to make, any statement in this Offer Document or any statement upon which a statement in this Offer Document is based and, to the maximum extent permitted by law, expressly disclaim and take no responsibility for any liability to any persons which is based on, or arises out of, the statements, information or opinions in this Offer Document.

RESPONSIBILITY STATEMENT BY OUR DIRECTORS 28. This Offer Document has been read and approved by our Directors and they collectively and individually accept full responsibility for the accuracy of the information given in this Offer Document and confirm after making all reasonable enquiries, that to the best of their knowledge and belief, this Offer Document constitutes full and true disclosure of all material facts about the Placement, our Company and our subsidiary, and our Directors are not aware of any facts the omission of which would make any statement in this Offer Document misleading. Where information in this Offer Document has been extracted from published or 135

GENERAL AND STATUTORY INFORMATION
otherwise publicly available sources or obtained from a named source, the sole responsibility of our Directors has been to ensure that such information has been accurately and correctly extracted from those sources and/or reproduced in this Offer Document in its proper form and context.

DOCUMENTS AVAILABLE FOR INSPECTION 29. The following documents or copies thereof may be inspected at our registered office at 3 Kaki Bukit Road 2, #01-06 Eunos Warehouse Complex, Singapore 417837 during normal business hours for a period of six months from the date of registration of this Offer Document: (a) (b) the Memorandum and Articles of Association of our Company; the Audited Combined Financial Statements Of PS Group Holdings Ltd. And Its Subsidiary For The Financial Years Ended 31 December 2010, 2011 And 2012 and the Report from the Independent Auditors in relation to the “ Audited Combined Financial Statements Of PS Group Holdings Ltd. And Its Subsidiary For The Financial Years Ended 31 December 2010, 2011 And 2012 ” as set out in Appendix A of this Offer Document; the audited financial statements of our subsidiary, PS Fasteners, for the financial years ended 31 December 2010, 2011 and 2012 and all notes, reports and information relating thereto which are required to be prepared under the Companies Act; the material contract referred to in the section entitled “ General and Statutory Information – Material Contracts ” of this Offer Document; the letters of consent referred to in the section entitled “ General and Statutory Information – Consents ” of this Offer Document; and the Service Agreements referred to in the section entitled “ Directors, Management and Staff – Service Agreements ” of this Offer Document.

(c)

(d)

(e)

(f)

136

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
Company Registration No. 201311520Z

PS Group Holdings Ltd. and its Subsidiary Audited Combined Financial Statements Financial Years ended 31 December 2010, 2011 and 2012

A-1

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 Index Statement by Directors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Independent Auditor’s Report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Combined Statements of Comprehensive Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Combined Balance Sheets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Combined Statements of Changes in Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Combined Statements of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Page A-3 A-4 A-6 A-7 A-8 A-9 A-10 Notes to the Combined Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

A-2

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 STATEMENT BY DIRECTORS We, Teo Choon Hock and Kwek Keng Seng, being two of the directors of PS Group Holdings Ltd. (the “Company”), do hereby state that, in our opinion, (i) the accompanying combined financial statements together with notes thereto are drawn up so as to present fairly, in all material respects, the state of affairs of the Company and its subsidiary (collectively, the “Group”) as at 31 December 2010, 2011 and 2012 and the results of the business, changes in equity and cash flows of the Group for the financial years ended on those dates; and at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay its debts as and when they fall due.

(ii)

On behalf of the board of directors:

Teo Choon Hock Director

Kwek Keng Seng Director

Singapore 3 July 2013

A-3

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
REPORT FROM THE INDEPENDENT AUDITORS IN RELATION TO THE AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 3 July 2013 The Board of Directors PS Group Holdings Ltd. 3 Kaki Bukit Road 2 #01-06 Eunos Warehouse Complex Singapore 417837 Independent Auditor’s Report on the Combined Financial Statements We have audited the accompanying combined financial statements of PS Group Holdings Ltd. (the “Company”) and its subsidiary (collectively, the “Group”) set out on pages A-6 to A-46, which comprise the combined balance sheets of the Group as at 31 December 2010, 2011 and 2012, and the combined statements of comprehensive income, combined statements of changes in equity and combined statements of cash flows of the Group for the financial years then, and a summary of significant accounting policies and other explanatory information. Management’s Responsibility for the Combined Financial Statements Management is responsible for the preparation of combined financial statements that give a true and fair view in accordance with Singapore Financial Reporting Standards, and for devising and maintaining a system of internal accounting controls sufficient to provide a reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised and that they are recorded as necessary to permit the preparation of true and fair profit and loss accounts and balance sheets and to maintain accountability of assets. Auditor’s Responsibility Our responsibility is to express an opinion on these combined financial statements based on our audit. We conducted our audit in accordance with Singapore Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the combined financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the combined financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the combined financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the combined financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the combined financial statements.

A-4

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
REPORT FROM THE INDEPENDENT AUDITORS IN RELATION TO THE AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the combined financial statements of the Group are properly drawn up in accordance with Singapore Financial Reporting Standards so as to present fairly, in all material respects, the state of affairs of the Group as at 31 December 2010, 2011 and 2012 and the results, changes in equity and cash flows of the Group for the financial years ended on those dates. Other Matter This report has been prepared solely for inclusion in the Offer Document of the Company dated 3 July 2013 in connection with the proposed listing of the Company’s shares on the Catalist Board of Singapore Exchange Securities Trading Limited.

ERNST & YOUNG LLP Public Accountants and Chartered Accountants Singapore 3 July 2013 Partner-in-charge: Adrian Koh Hian Yan

A-5

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY COMBINED STATEMENTS OF COMPREHENSIVE INCOME FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 Note Revenue Cost of sales Gross profit Other income Expenses Selling and distribution expenses Administration expenses Finance expenses Profit before taxation Income tax expense Profit for the year Other comprehensive income for the year, net of tax Total comprehensive income for the year Profit for the year attributable to: Owners of the Company Earnings per share attributable to owners of the Company: Basic and diluted 9 4.17 3.26 2.73 1,669,253 1,304,288 1,092,237 6 7 8 (550,790) (1,531,096) (47,526) 1,912,032 (242,779) 1,669,253 (608,082) (1,625,287) (30,098) 1,479,205 (174,917) 1,304,288 (720,355) (1,886,800) (45,709) 1,329,665 (237,428) 1,092,237 5 4 2010 $ 11,991,482 (8,208,975) 3,782,507 258,937 2011 $ 12,502,580 (8,822,419) 3,680,161 62,511 2012 $ 12,293,262 (8,318,432) 3,974,830 7,699

– 1,669,253

– 1,304,288

– 1,092,237

The accompanying accounting policies and explanatory notes form an integral part of the combined financial statements. A-6

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY COMBINED BALANCE SHEETS AS AT 31 DECEMBER 2010, 2011 AND 2012 Note ASSETS Non-current asset Property, plant and equipment Current assets Inventories Trade and other receivables Prepayments Cash and cash equivalents 2010 $ 2011 $ 2012 $

10

3,275,290

3,214,249

3,169,582

12 13 14

5,137,741 1,944,928 – 843,382 7,926,051

6,275,982 2,218,799 – 191,725 8,686,506 11,900,755

7,635,370 2,025,913 74,788 334,817 10,070,888 13,240,470

Total assets EQUITY AND LIABILITIES Current liabilities Trade and other payables Loans and borrowings Income tax payable

11,201,341

15 16

1,922,947 3,010,053 247,050 5,180,050

2,600,291 2,600,000 173,606 5,373,897 3,312,609

2,750,646 2,933,333 233,545 5,917,524 4,153,364

Net current assets Non-current liabilities Loans and borrowings Deferred tax liabilities

2,746,001

16 17

– 14,230 14,230

– 15,541 15,541 5,389,438 6,511,317

500,000 19,424 519,424 6,436,948 6,803,522

Total liabilities Net assets Equity attributable to owners of the Company Share capital Retained earnings Total equity Total equity and liabilities

5,194,280 6,007,061

18

400,016 5,607,045 6,007,061 11,201,341

400,016 6,111,301 6,511,317 11,900,755

400,016 6,403,506 6,803,522 13,240,470

The accompanying accounting policies and explanatory notes form an integral part of the combined financial statements. A-7

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY COMBINED STATEMENTS OF CHANGES IN EQUITY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 Share capital $ Retained earnings $

Note 2010 At 1 January 2010 Profit for the year, representing total comprehensive income for the year Dividends At 31 December 2010 2011 At 1 January 2011 Profit for the year, representing total comprehensive income for the year Dividends At 31 December 2011 2012 At 1 January 2012 Profit for the year, representing total comprehensive income for the year Dividends At 31 December 2012 19 19 19

Total $

400,016 – – 400,016

4,737,824 1,669,253 (800,032) 5,607,045

5,137,840 1,669,253 (800,032) 6,007,061

400,016 – – 400,016

5,607,045 1,304,288 (800,032) 6,111,301

6,007,061 1,304,288 (800,032) 6,511,317

400,016 – – 400,016

6,111,301 1,092,237 (800,032) 6,403,506

6,511,317 1,092,237 (800,032) 6,803,522

The accompanying accounting policies and explanatory notes form an integral part of the combined financial statements. A-8

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY COMBINED STATEMENTS OF CASH FLOWS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
Note Operating activities: Profit before taxation Adjustments for: Interest income Reversal of impairment loss on leasehold properties Finance expenses Depreciation of property, plant and equipment Loss on disposal of property, plant and equipment Total adjustments Operating cash flows before changes in working capital Changes in working capital: Increase in inventories Decrease/(increase) in trade and other receivables, and prepayments Increase/(decrease) in trade and other payables Total changes in working capital Cash generated from operations Income tax paid Interest received Net cash flows from/(used in) operating activities Investing activities: Purchase of property, plant and equipment Proceeds on disposal of property, plant and equipment Net cash flows used in investing activities Financing activities: Net change in trust receipts Finance expenses paid Proceeds from bank loans Repayment of bank loan Dividend paid Net cash flows used in financing activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at 1 January Cash and cash equivalents at 31 December 14 10 2010 $ 1,912,032 5 5 6 7 7 (1,060) (182,290) 47,526 151,421 5,331 20,928 1,932,960 (521,565) 161,983 155,529 (204,053) 1,728,907 (186,980) 1,060 1,542,987 (87,615) 1,869 (85,746) (58,256) (47,526) – (228,092) (800,032) (1,133,906) 323,335 520,047 843,382 2011 $ 1,479,205 (190) (62,321) 30,098 251,724 2,650 221,961 1,701,166 (1,138,241) (273,871) (94,640) (1,506,752) 194,414 (247,049) 190 (52,445) (131,162) 150 (131,012) 771,983 (30,098) – (410,053) (800,032) (468,200) (651,657) 843,382 191,725 2012 $ 1,329,665 (547) – 45,709 143,405 1,824 190,391 1,520,056 (1,359,388) 118,098 437,710 (803,580) 716,476 (173,606) 547 543,417 (100,562) – (100,562) (287,355) (45,709) 1,000,000 (166,667) (800,032) (299,763) 143,092 191,725 334,817

19

The accompanying accounting policies and explanatory notes form an integral part of the combined financial statements. A-9

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 1. 1.1 Corporate information The Company The Company was incorporated on 30 April 2013 under the Companies Act as an exempt private company limited by shares under the name of PS Group Holdings Pte. Ltd.. The Company was incorporated for the purpose of acquiring the existing operating entity, PS Fasteners Pte. Ltd. pursuant to the Restructuring Exercise as disclosed in Note 1.2. On 18 June 2013, the Company was converted to a public limited company and changed its name to PS Group Holdings Ltd.. The registered office of the Company and principal place of business of the Group is located at 3 Kaki Bukit Road 2, #01-06 Eunos Warehouse Complex, Singapore 417837. The principal activity of the Company is that of investment holding. The principal activity of its subsidiary is disclosed in Note 11 to the combined financial statements. The Company and its subsidiary, PS Fasteners Pte. Ltd. are collectively defined as the “Group” in the combined financial statements. 1.2 The Restructuring Exercise The Group undertook the transactions described below as part of a corporate reorganisation implemented in preparation for its listing on the Catalist Board of Singapore Exchange Securities Trading Limited (the “Restructuring Exercise”). (a) Incorporation of the Company On 30 April 2013, the major shareholder of PS Fasteners Pte. Ltd., Teo Choon Hock incorporated PS Group Holdings Pte. Ltd.. (b) Acquisition of PS Fasteners Pte. Ltd. Pursuant to a share swap agreement dated 30 May 2013 entered into between the Company, Teo Choon Hock and Kwek Keng Seng, the Company acquired from Teo Choon Hock and Kwek Keng Seng (collectively, the “Shareholders”) 220,008 and 180,008 ordinary shares respectively in the entire issued and paid-up share capital of PS Fasteners Pte. Ltd., comprising an aggregate of 400,016 ordinary shares. Pursuant to the completion of the Restructuring Exercise, PS Fasteners Pte. Ltd. became a wholly owned subsidiary of the Company.

A-10

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 2. 2.1 Summary of significant accounting policies Basis of preparation Although the Company was incorporated subsequent to 31 December 2012 upon which the Restructuring Exercise was completed on 14 June 2013, the financial statements presented for the financial years ended 31 December 2010, 2011 and 2012 for the purpose of inclusion in the Offer Document are that of the Company and its subsidiary company prepared in accordance with RAP 12 Merger Accounting for Common Control Combinations for financial statements prepared under Part IX of the Fifth Schedule to the Securities and Futures (Offers of Investments) (Shares and Debentures) Regulations 2005. The substance is that the Group is a continuation of PS Fastener Pte. Ltd.. The combined financial statements of the Group for the financial years ended 31 December 2010, 2011 and 2012 have been presented as if the Group had been in existence for all periods presented and the assets and liabilities are brought into the combined financial statements at their existing carrying amounts. The retained earnings recognised in the combined financial statements are the retained earnings of PS Fastener Pte. Ltd.. The combined financial statements of the Group have been prepared in accordance with Singapore Financial Reporting Standards (“FRS”). The combined financial statements are presented in Singapore Dollars (SGD or $). The combined financial statements have been prepared on a historical cost basis, except as disclosed in the accounting policies below. 2.2 Changes in accounting policies The Group has adopted all the standards and Interpretations of FRS (INT FRS) that are effective for annual periods beginning on or after 1 January 2010, 2011 and 2012. The adoption of these standards did not have any effect on the financial performance or position of the Group.

A-11

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 2. 2.3 Summary of significant accounting policies (cont’d) Standards issued but not yet effective The Group has not adopted the following standards and interpretations that have been issued but not yet effective: Effective for annual periods beginning on or after 1 July 2012 1 January 2013 1 January 2013 1 January 2013

Description Amendments to FRS 1 Presentation of Items of Other Comprehensive Income Revised FRS 19 Employee Benefits FRS 113 Fair Value Measurement Amendments to FRS 107 Disclosures – Offsetting Financial Assets and Financial Liabilities Improvements to FRSs 2012 – Amendment to FRS 1 Presentation of Financial Statements – Amendment to FRS 16 Property, Plant and Equipment – Amendment to FRS 32 Financial Instruments: Presentation Revised FRS 27 Separate Financial Statements Revised FRS 28 Investments in Associates and Joint Ventures FRS 110 Consolidated Financial Statements FRS 111 Joint Arrangements FRS 112 Disclosure of Interests in Other Entities Amendments to FRS 32 Offsetting Financial Assets and Financial Liabilities Amendments to FRS 110 Consolidated Financial Statements , FRS 112 Disclosure of Interests in Other Entities and FRS 27 Separate Financial Statements – Investment Entities

1 January 2013 1 January 2013 1 January 2013 1 January 2014 1 January 2014 1 January 2014 1 January 2014 1 January 2014 1 January 2014

1 January 2014

The directors expect that the adoption of the other standards and interpretations above will have no material impact on the combined financial statements in the period of initial application.

A-12

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 2. 2.4 Summary of significant accounting policies (cont’d) Functional and foreign currency The Group’s combined financial statements are presented in Singapore Dollars, which is also the Company’s functional currency. Each entity in the Group determines its own functional currency and items included in the combined financial statements of each entity are measured using that functional currency. Transactions in foreign currencies are measured in the respective functional currencies of the Company and its subsidiary and are recorded on initial recognition in the functional currencies at exchange rates approximating those ruling at the transaction dates. Monetary assets and liabilities denominated in foreign currencies are translated at the rate of exchange ruling at the end of the reporting period. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined. Exchange differences arising on the settlement of monetary items or on translating monetary items at the end of the reporting period are recognised in profit or loss. 2.5 Basis of consolidation The combined financial statements comprise the financial statements of the Company and its subsidiary as at the end of the reporting period. The financial statements of the subsidiary used in the preparation of the combined financial statements are prepared for the same reporting date as the Company. Consistent accounting policies are applied to like transactions and events in similar circumstances. All intra-group balances, income and expenses and unrealised gains and losses resulting from intra-group transactions and dividends are eliminated in full. The substance is that the Group is a continuation of PS Fastener Pte. Ltd.. The combined financial statements of the Group for the financial years ended 31 December 2010, 2011 and 2012 have been presented as if the Group had been in existence for all periods presented and the assets and liabilities are brought into the combined financial statements at their existing carrying amounts. The retained earnings recognised in the combined financial statements are the retained earnings of PS Fastener Pte. Ltd.. 2.6 Subsidiary A subsidiary is an entity over which the Group has the power to govern the financial and operating policies so as to obtain benefits from its activities.

A-13

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 2. 2.7 Summary of significant accounting policies (cont’d) Property, plant and equipment All items of property, plant and equipment are initially recorded at cost. Subsequent to recognition, property, plant and equipment and are measured at cost less accumulated depreciation and any accumulated impairment losses. The cost includes the cost of replacing part of the property, plant and equipment and borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying property, plant and equipment. The cost of an item of property, plant and equipment is recognised as an asset if, and only if, it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. When significant parts of property, plant and equipment are required to be replaced in intervals, the Group recognises such parts as individual assets with specific useful lives and depreciation, respectively. Likewise, when a major inspection is performed, its cost is recognised in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognised in profit or loss as incurred. Depreciation is computed on a straight-line basis over the estimated useful lives of the assets as follows: Leasehold properties Leasehold improvements Motor vehicles Tools and equipment Office equipment Furniture and fittings Computers – – – – – – – 41 years 5 to 10 years 5 to 10 years 5 to 10 years 5 to 10 years 5 to 10 years 1 to 3 years

The carrying values of property, plant and equipment are reviewed for impairment when events or changes in circumstances indicate that the carrying value may not be recoverable. The residual value, useful life and depreciation method are reviewed at each financial year-end, and adjusted prospectively, if appropriate. An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss on de-recognition of the asset is included in profit or loss in the year the asset is derecognised.

A-14

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 2. 2.8 Summary of significant accounting policies (cont’d) Impairment of non-financial assets The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, or when an annual impairment testing for an asset is required, the Group makes an estimate of the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s fair value less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of an asset or cash-generating unit exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows expected to be generated by the asset are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs to sell, recent market transactions are taken into account, if available. If no such transactions can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples or other available fair value indicators. Impairment losses of continuing operations are recognised in profit or loss in those expense categories consistent with the function of the impaired asset. For assets excluding goodwill, an assessment is made at each reporting date as to whether there is any indication that previously recognised impairment losses may no longer exist or may have decreased. If such indication exists, the Group estimates the asset’s or cash-generating unit’s recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognised. If that is the case, the carrying amount of the asset is increased to its recoverable amount. That increase cannot exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised previously. Such reversal is recognised in profit or loss. 2.9 Inventories Inventories are stated at the lower of cost and net realisable value. Costs incurred in bringing the inventories to their present location and condition are accounted for using the weighted average cost formula. Where necessary, allowance is provided for damaged, obsolete and slow moving items to adjust the carrying value of inventories to the lower of cost and net realisable value. Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale.

A-15

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 2. Summary of significant accounting policies (cont’d)

2.10 Financial assets Initial recognition and measurement Financial assets are recognised when, and only when, the Group becomes a party to the contractual provisions of the financial instrument. The Group determines the classification of its financial assets at initial recognition. When financial assets are recognised initially, they are measured at fair value, plus, in the case of financial assets not at fair value through profit or loss, directly attributable transaction costs. Subsequent measurement Loans and receivables Non-derivative financial assets with fixed or determinable payments that are not quoted in an active market are classified as loans and receivables. Subsequent to initial recognition, loans and receivables are measured at amortised cost using the effective interest method, less impairment. Gains and losses are recognised in profit or loss when the loans and receivables are derecognised or impaired, and through the amortisation process. Trade and other receivables, and cash and cash equivalents are classified as loans and receivables. De-recognition A financial asset is derecognised where the contractual right to receive cash flows from the asset has expired. On de-recognition of a financial asset in its entirety, the difference between the carrying amount and the sum of the consideration received is recognised in profit or loss. Regular way purchase or sale of a financial asset All regular way purchases and sales of financial assets are recognised or derecognised on the trade date i.e., the date that the Group commits to purchase or sell the asset. Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within the period generally established by regulation or convention in the marketplace concerned.

A-16

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 2. 2.11 Summary of significant accounting policies (cont’d) Impairment of financial assets The Group assesses at each reporting date whether there is any objective evidence that a financial asset is impaired. (a) Financial assets carried at amortised cost For financial assets carried at amortised cost, the Group first assesses whether objective evidence of impairment exists individually for financial assets that are individually significant, or collectively for financial assets that are not individually significant. If the Group determines that no objective evidence of impairment exists for an individually assessed financial asset, whether significant or not, it includes the asset in a group of financial assets with similar credit risk characteristics and collectively assesses them for impairment. Assets that are individually assessed for impairment and for which an impairment loss is, or continues to be recognised are not included in a collective assessment of impairment. If there is objective evidence that an impairment loss on financial assets carried at amortised cost has been incurred, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the financial asset’s original effective interest rate. If a loan has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate. The carrying amount of the asset is reduced through the use of an allowance account. The impairment loss is recognised in profit or loss. When the asset becomes uncollectible, the carrying amount of impaired financial assets is reduced directly or if an amount was charged to the allowance account, the amounts charged to the allowance account are written off against the carrying value of the financial asset. To determine whether there is objective evidence that an impairment loss on financial assets has been incurred, the Group considers factors such as the probability of insolvency or significant financial difficulties of the debtor and default or significant delay in payments. If in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed to the extent that the carrying amount of the asset does not exceed its amortised cost at the reversal date. The amount of reversal is recognised in profit or loss.

A-17

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 2. 2.11 Summary of significant accounting policies (cont’d) Impairment of financial assets (cont’d) (b) Financial assets carried at cost If there is objective evidence (such as significant adverse changes in the business environment where the issuer operates, probability of insolvency or significant financial difficulties of the issuer) that an impairment loss on financial assets carried at cost has been incurred, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the current market rate of return for a similar financial asset. Such impairment losses are not reversed in subsequent periods. 2.12 Cash and cash equivalents Cash and cash equivalents comprise cash at bank and on hand, and demand deposits that are readily convertible to known amount of cash and which are subject to an insignificant risk of changes in value. 2.13 Provisions Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and the amount of the obligation can be estimated reliably. Provisions are reviewed at the end of each reporting period and adjusted to reflect the current best estimate. If it is no longer probable that an outflow of economic resources will be required to settle the obligation, the provision is reversed. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, where appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost. 2.14 Financial liabilities Initial recognition and measurement Financial liabilities are recognised when, and only when, the Group becomes a party to the contractual provisions of the financial instrument. The Group determines the classification of its financial liabilities at initial recognition. All financial liabilities are recognised initially at fair value plus in the case of financial liabilities not at fair value through profit or loss, directly attributable transaction costs.

A-18

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 2. Summary of significant accounting policies (cont’d)

2.14 Financial liabilities (cont’d) Subsequent measurement Other financial liabilities After initial recognition, other financial liabilities are subsequently measured at amortised cost using the effective interest rate method. Gains and losses are recognised in profit or loss when the liabilities are derecognised, and through the amortisation process. Trade and other payables, and loans and borrowings are classified as other liabilities. De-recognition A financial liability is de-recognised when the obligation under the liability is discharged or cancelled or expired. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a de-recognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised in profit or loss. 2.15 Employee benefits (a) Defined contribution plans The Group makes contributions to the Central Provident Fund scheme in Singapore, a defined contribution pension scheme. Contributions to defined contribution pension schemes are recognised as an expense in the period in which the related service is performed. (b) Employee leave entitlement Employee entitlements to annual leave are recognised as a liability when they accrue to the employees. The estimated liability for leave is recognised for services rendered by employees up to the end of the reporting period.

A-19

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 2. Summary of significant accounting policies (cont’d)

2.16 Revenue Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured, regardless of when the payment is made. Revenue is measured at the fair value of consideration received or receivable, taking into account contractually defined terms of payment, net of commission and discount, and excluding taxes or duty. The Group assesses its revenue arrangements to determine if it is acting as principal or agent. The Group has concluded that it is acting as a principal in all of its revenue arrangements. The following specific recognition criteria must also be met before revenue is recognised: (a) Sale of goods Revenue from sale of goods is recognised upon the transfer of significant risk and rewards of ownership of the goods to the customer, usually on delivery of goods. Revenue is not recognised to the extent where there are significant uncertainties regarding recovery of the consideration due, associated costs or the possible return of goods. (b) Interest income Interest income is recognised using the effective interest method. 2.17 Borrowing costs Borrowing costs are capitalised as part of the cost of a qualifying asset if they are directly attributable to the acquisition, construction or production of that asset. Capitalisation of borrowing costs commences when the activities to prepare the asset for its intended use or sale are in progress and the expenditures and borrowing costs are incurred. Borrowing costs are capitalised until the assets are substantially completed for their intended use or sale. All other borrowing costs are expensed in the period they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. 2.18 Taxes (a) Current income tax Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted at the end of the reporting period, in the country where the Group operates and generates taxable income.

A-20

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 2. Summary of significant accounting policies (cont’d)

2.18 Taxes (cont’d) (a) Current income tax (cont’d) Current income taxes are recognised in profit or loss except to the extent that the tax relates to items recognised outside profit or loss, either in other comprehensive income or directly in equity. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate. (b) Deferred tax Deferred tax is provided using the liability method on temporary differences at the end of the reporting period between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred tax assets are recognised for all deductible temporary differences, carry forward of unused tax credits and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised. The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets are reassessed at the end of each reporting period and are recognised to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the end of each reporting period. Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss. Deferred tax items are recognised in correlation to the underlying transaction either in other comprehensive income or directly in equity. Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current income tax assets against current income tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.

A-21

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 2. Summary of significant accounting policies (cont’d)

2.18 Taxes (cont’d) (c) Sales tax Revenues, expenses and assets are recognised net of the amount of sales tax except: – Where the sales tax incurred on a purchase of assets or services is not recoverable from the taxation authority, in which case the sales tax is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and Receivables and payables that are stated with the amount of sales tax included.



The net amount of sales tax recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the balance sheet. 2.19 Share capital and share issuance expenses Proceeds from issuance of ordinary shares are recognised as share capital in equity. Incremental costs directly attributable to the issuance of ordinary shares are deducted against share capital. 2.20 Contingencies A contingent liability is: (a) a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Group; or a present obligation that arises from past events but is not recognised because: (i) It is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or The amount of the obligation cannot be measured with sufficient reliability.

(b)

(ii)

A contingent asset is a possible asset that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Group. Contingent liabilities and assets are not recognised on the balance sheet of the Group, except for contingent liabilities assumed in a business combination that are present obligations and which the fair values can be reliably determined.

A-22

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 2. Summary of significant accounting policies (cont’d)

2.21 Related parties A related party is defined as follows: (a) A person or a close member of that person’s family is related to the Group and Company if that person: (i) (ii) has control or joint control over the Company; has significant influence over the Company; or

(iii) is a member of the key management personnel of the Group or Company or of a parent of the Company. (b) An entity is related to the Group and the Company if any of the following conditions applies: (i) the entity and the Company are members of the same group (which means that each parent, subsidiary and fellow subsidiary is related to the others). one entity is an associate or joint venture of the other entity (or an associate or joint venture of a member of a group of which the other entity is a member).

(ii)

(iii) both entities are joint ventures of the same third party. (iv) one entity is a joint venture of a third entity and the other entity is an associate of the third entity. (v) the entity is a post-employment benefit plan for the benefit of employees of either the Company or an entity related to the Company. If the Company is itself such a plan, the sponsoring employers are also related to the Company.

(vi) the entity is controlled or jointly controlled by a person identified in (a). (vii) a person identified in (a)(i) has significant influence over the entity or is a member of the key management personnel of the entity (or of a parent of the entity). 3. Significant accounting judgements and estimates The preparation of the Group’s combined financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities at the end of each reporting period. However, uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of the asset or liability affected in the future periods.

A-23

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 3. 3.1 Significant accounting judgements and estimates (cont’d) Judgments made in applying accounting policies In the process of applying the Group’s accounting policies, management has made the following judgments, apart from those involving estimations, which have the most significant effect on the amounts recognised in the combined financial statements: Determination of functional currency The Group measures foreign currency transactions in the respective functional currencies of the Company and its subsidiary. In determining the functional currencies of the respective entities in the Group, judgement is required to determine the currency that mainly influences sales prices for goods and services and of the country whose competitive forces and regulations mainly determines the sales prices of its goods and services. The functional currencies of the entities in the Group are determined based on management’s assessment of the economic environment in which the entities operate and the entities’ process of determining sales prices. 3.2 Key sources of estimation uncertainty The key assumptions concerning the future and other key sources of estimation uncertainty at the end of each reporting period, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below. The Group based its assumptions and estimates on parameters available when the combined financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising beyond the control of the Group. Such changes are reflected in the assumptions when they occur. (a) Impairment of loans and receivables The Group assesses at the end of each reporting period whether there is any objective evidence that a financial asset is impaired. To determine whether there is objective evidence of impairment, the Group considers factors such as the probability of insolvency or significant financial difficulties of the debtor and default or significant delay in payments. Where there is objective evidence of impairment, the amount and timing of future cash flows are estimated based on historical loss experience for assets with similar credit risk characteristics. The carrying amount of the Group’s loans and receivables at the end of the reporting period is disclosed in Note 13 to the combined financial statements.

A-24

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 3. 3.2 Significant accounting judgements and estimates (cont’d) Key sources of estimation uncertainty (cont’d) (b) Useful lives of property, plant and equipment The cost of property, plant and equipment is depreciated on a straight line basis over the property, plant and equipment’s estimated useful lives. Management estimates the useful lives of these property, plant and equipment to be within 1 to 41 years. Changes in the expected level of usage and technological developments could impact the economic useful lives of these assets, therefore future depreciation charges could be revised. The carrying amount of the Group’s plant and equipment at 31 December 2012 is disclosed in Note 10 to the combined financial statements. (c) Taxes Uncertainties exist with respect to the interpretation of complex tax regulations and the amount and timing of future taxable income. Differences arising between the actual results and the assumptions made, or future changes to such assumptions, could necessitate future adjustments to tax provisions already recorded. The Group establishes provisions, based on reasonable estimates, for possible consequences of audits by the tax authorities. The amount of provision is based on various factors, such as experience of previous tax audits and differing interpretations of tax regulations by the taxable entity and the relevant tax authority. Such differences of interpretation may arise on a wide variety of issues depending on the conditions prevailing in the respective Group entity’s domicile. The carrying amount of the Group’s income tax payable at 31 December 2012 was $233,545 (2011: $173,606; 2010: $247,050). The Group’s deferred tax liabilities at 31 December 2012 is disclosed in Note 17 to the combined financial statements. 4. Revenue 2010 $ Sale of goods 5. Other income 2010 $ Reversal of impairment loss on leasehold properties (Note 10) Government grants and credit received Interest income from cash at bank 182,290 75,587 1,060 258,937 2011 $ 62,321 – 190 62,511 2012 $ – 7,152 547 7,699 11,991,482 2011 $ 12,502,580 2012 $ 12,293,262

A-25

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 6. Finance expenses 2010 $ Interest expense on: – Trust receipts – Bank loans 28,889 18,637 47,526 20,354 9,744 30,098 35,224 10,485 45,709 2011 $ 2012 $

7.

Profit before taxation Profit is stated after charging/(crediting): 2010 $ Audit fees paid to auditors of the Group Depreciation of property, plant and equipment (Note 10) Exchange loss/(gain), net Warehouse maintenance fee Listing expense Loss on disposal of property, plant and equipment Inventories recognised as an expense in cost of sales (Note 12) Employee benefits expenses (including directors’ remuneration): – Wages, salaries and bonuses – Central Provident Fund Contribution – Other short term employee benefits 927,371 72,331 50,435 973,617 83,613 34,834 1,106,486 108,277 36,689 3,600 151,421 16,748 44,820 – 5,331 8,198,909 2011 $ 4,400 251,724 (3,529) 44,820 – 2,650 8,810,294 2012 $ 40,000 143,405 38,231 44,820 173,425 1,824 8,305,131

A-26

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 8. Income tax expense Major components of income tax expense The major components of income tax expense for the financial years ended 31 December are: 2010 $ Current income tax: – Current income taxation Deferred tax (Note 17): – Origination and reversal of temporary difference – Over provision in respect of prior years (4,270) – 242,779 1,311 – 174,917 5,502 (1,619) 237,428 247,049 173,606 233,545 2011 $ 2012 $

Relationship between tax expense and accounting profit A reconciliation between tax expense and the product of profit before tax multiplied by the applicable tax rate for the financial years ended 31 December are as follows: Profit before taxation Tax at statutory income tax rate of 17% (2011: 17%; 2010: 17%) Adjustments: Non-deductible expenses Income not subject to taxation Effect of partial tax exemption and tax relief Over provision of deferred tax in respect of prior years Others Income tax expense recognised in profit or loss 19,551 (43,890) (54,542) – (3,385) 29,546 (10,595) (93,947) – (1,552) 59,846 (850) (45,992) (1,619) – 1,912,032 1,479,205 1,329,665

325,045

251,465

226,043

242,779

174,917

237,428

A-27

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 9. Earnings per share The basic and diluted earnings per share are calculated by dividing the profit for the year, net of tax, attributable to owners of the Company by the weighted average number of ordinary shares outstanding during the financial year. The Company did not hold any dilutive potential ordinary shares during the financial year (2011: Nil; 2010: Nil). The following table reflects the statement of comprehensive income and share data used in the computation of basic and diluted earnings per share for the years ended 31 December 2010, 2011 and 2012. 2010 $ Profit for the year attributable to owners of the Company Weighted average number of ordinary share for basic and diluted earnings per share computation Earnings per share – Basic and diluted 4.17 3.26 2.73 1,669,253 2011 $ 1,304,288 2012 $ 1,092,237

400,016

400,016

400,016

A-28

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012

PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY

NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012

10. Leasehold properties $ Leasehold improvements $ Motor vehicles $ Tools and equipment $ Office equipment $ Furniture and fittings $

Property, plant and equipment

Computers $

Total $

2010 Cost: At 1 January 2010 Additions Disposals 4,222,554 – – 4,222,554 37,634 37,400 180,601 29,398 37,634 – – 37,400 – – 125,421 73,180 (18,000) 27,711 1,687 –

132,413 – – 132,413

103,632 12,748 – 116,380

4,686,765 87,615 (18,000) 4,756,380

At 31 December 2010

Accumulated depreciation and impairment loss: At 1 January 2010 Charge for the year Disposals Reversal of impairment (Note 5) 1,172,554 102,989 – (182,290) 1,093,253 3,129,301 10,931 26,703 37,400 – – – 22,940 3,763 – 37,400 – – 71,258 17,952 (10,800) – 78,410 102,191

17,443 2,514 – – 19,957 9,441

97,532 11,455 – – 108,987 23,426

103,632 12,748 – – 116,380 –

1,522,759 151,421 (10,800) (182,290) 1,481,090 3,275,290

At 31 December 2010

Net carrying amount: At 31 December 2010

A-29

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012

PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY

NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012

10. Leasehold properties $ Leasehold improvements $ Motor vehicles $ Tools and equipment $ Office equipment $ Furniture and fittings $

Property, plant and equipment (cont’d)

Computers $

Total $

2011 Cost: At 1 January 2011 Additions Disposals Written off 4,222,554 – – – 4,222,554 37,634 37,400 180,313 29,747 37,634 – – – 37,400 – – – 180,601 1,795 (1,000) (1,083) 29,398 11,610 (7,000) (4,261)

132,413 460 – (13,298) 119,575

116,380 117,297 – (84,009) 149,668

4,756,380 131,162 (8,000) (102,651) 4,776,891

At 31 December 2011

Accumulated depreciation and impairment loss: At 1 January 2011 Charge for the year Disposals Written off Reversal of impairment (Note 5) 1,093,253 102,989 – – (62,321) 1,133,921 3,088,633 7,168 30,466 – – 37,400 – 26,703 3,763 – – 37,400 – – –

78,410 18,031 (300) (1,083) – 95,058 85,255

19,957 2,837 (4,900) (4,261) – 13,633 16,114

108,987 6,807 – (13,298) – 102,496 17,079

116,380 117,297 – (84,009) – 149,668 –

1,481,090 251,724 (5,200) (102,651) (62,321) 1,562,642 3,214,249

At 31 December 2011

Net carrying amount: At 31 December 2011

A-30

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012

PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY

NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012

10. Leasehold properties $ Leasehold improvements $ Motor vehicles $ Tools and equipment $ Office equipment $ Furniture and fittings $

Property, plant and equipment (cont’d)

Computers $

Total $

2012 Cost: At 1 January 2012 Additions Disposals 4,222,554 – – 4,222,554 27,622 37,400 213,535 23,263 37,634 10,494 (20,506) 37,400 – – 180,313 35,000 (1,778) 29,747 2,200 (8,684)

119,575 35,670 (14,490) 140,755

149,668 17,198 (14,902) 151,964

4,776,891 100,562 (60,360) 4,817,093

At 31 December 2012

Accumulated depreciation and impairment loss: At 1 January 2012 Charge for the year Disposals 1,133,921 102,989 – 1,236,910 2,985,644 13,884 – 13,738 37,400 30,466 3,752 (20,480) 37,400 – – 95,058 18,137 (1,778) 111,417 102,118

13,633 2,591 (8,482) 7,742 15,521

102,496 11,709 (12,894) 101,311 39,444

149,668 4,227 (14,902) 138,993 12,971

1,562,642 143,405 (58,536) 1,647,511 3,169,582

At 31 December 2012

Net carrying amount: At 31 December 2012

A-31

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 10. Property, plant and equipment (cont’d) Impairment of assets As at the balance sheet date, the reversal of impairment losses recognised in profit or loss was $ Nil (2011: $62,321; 2010: $182,290) as the market value of the leasehold properties had increased during these years. Assets pledged as security The Group’s leasehold properties with a carrying amount of $2,985,644 (2011: $3,088,633; 2010: $3,129,301) are mortgaged to secure the Group’s banking facilities (Note 15 and 16). 11. Investment in a subsidiary The subsidiary of the Company is as follows: Name of subsidiary Country of incorporation Principal activities Proportion (%) of ownership interest 2010 2011 2012 % % %

Held by the Company PS Fasteners Pte. Ltd.* Singapore Import and export of bolts, nuts, rivets, fasteners and screw machine products 100 100 100

* Audited by Ernst & Young LLP, Singapore

For the financial years ended 31 December 2010, 2011 and 2012, the financial results of PS Fasteners Pte. Ltd. were combined with the Company on the basis that the Group is a continuation of the existing business of PS Fasteners Pte. Ltd. under common control. Accordingly, the equity interests in this subsidiary held by the Company for those financial years were deemed to be 100%.

A-32

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 12. Inventories 2010 $ Trading stocks Goods in transit Total inventories at lower of cost and net realisable value Combined statement of comprehensive income: Inventories recognised as an expense in cost of sales 8,198,909 8,810,294 8,305,131 5,137,741 – 2011 $ 6,275,982 – 2012 $ 7,555,048 80,322

5,137,741

6,275,982

7,635,370

13.

Trade and other receivables 2010 $ Trade receivables Sundry receivables Deposits Trade and other receivables Add: Cash and cash equivalents (Note 14) Total loans and receivables 1,815,090 127,198 2,640 1,944,928 843,382 2,788,310 2011 $ 2,050,832 164,686 3,281 2,218,799 191,725 2,410,524 2012 $ 1,890,726 131,397 3,790 2,025,913 334,817 2,360,730

Trade receivables due from third parties are unsecured, non-interest bearing and are generally on 30 to 90 days’ terms. They are recognised at their original invoiced amounts which represent their fair values on initial recognition. Trade receivables denominated in foreign currencies as at 31 December are as follows: 2010 $ United States Dollar 122,566 2011 $ 222,079 2012 $ 51,452

A-33

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 13. Trade and other receivables (cont’d) Receivables that are past due but not impaired The Group has trade receivables amounting to $1,456,399 (2011: $1,835,665; 2010: $1,600,462) that are past due at the end of the reporting period but not impaired. These receivables are unsecured and the analysis of these aging at the end of the reporting period is as follows: 2010 $ Trade receivables past due but not impaired: Less than 30 days 30 – 60 days 61 – 90 days 91 – 120 days More than 120 days 727,771 432,078 183,732 165,627 91,254 1,600,462 875,734 379,219 378,634 144,006 58,072 1,835,665 647,180 434,696 175,708 90,790 108,025 1,456,399 2011 $ 2012 $

Receivables that are impaired There are no trade receivables that are impaired at the balance sheet date (2011: Nil; 2010: Nil). 14. Cash and cash equivalents 2010 $ Cash at bank Cash on hand 834,433 8,949 843,382 2011 $ 189,846 1,879 191,725 2012 $ 332,817 2,000 334,817

Cash at bank earns daily interest based on the bank’s deposit rate. The interest rate as at 31 December 2012 for the Group was 0.018% per annum (2011: 0.018% per annum; 2010: 0.118% per annum).

A-34

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 14. Cash and cash equivalents (cont’d) Cash at bank denominated in foreign currency at 31 December are as follow: 2010 $ United States Dollar – 2011 $ – 2012 $ 27,904

15.

Trade and other payables 2010 $ Trade payables Sundry payables Accrued operating expenses Trust receipts 309,319 14,616 673,669 925,343 1,922,947 Add: Loans and borrowings (Note 16) Total financial liabilities carried at amortised cost 3,010,053 2011 $ 200,161 6,453 696,351 1,697,326 2,600,291 2,600,000 2012 $ 436,848 13,777 890,050 1,409,971 2,750,646 3,433,333

4,933,000

5,200,291

6,183,979

Trade payables and sundry payables due to third parties are non-interest bearing and are normally settled on 30 days term. Trust receipts bear interest of between 1.623% and 2.350% per annum (2011: 1.628% and 2.350% per annum; 2010: 1.628% and 2.350% per annum) and are normally settled between 120 and 150 days (2011: 120 and 150 days; 2010: 120 and 150 days). Trust receipts are secured by a first legal mortgage over the leasehold properties of the Group (Note 10) and joint and several guarantees by the Company’s directors. Trade and other payables denominated in foreign currencies as at 31 December are as follows: 2010 $ United States Dollar Australia Dollar Japanese Yen 530,749 24,562 667 2011 $ 922,755 22,297 – 2012 $ 306,529 17,750 –

A-35

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 16. Loans and borrowings 2010 $ 2011 $ 2012 $

Maturity Current: Loan from directors Bank loans: – SGD loan at between 4.28% and 4.98% p.a. – SGD loan at between 3.78% and 4.98% p.a. – SGD loan at 1.50% p.a. above bank cost of funds 2011 2011 2013 On demand

2,600,000

2,600,000

2,600,000

283,690 126,363 –

– – –

– – 333,333

3,010,053

2,600,000

2,933,333

Non-current: Bank loans: – SGD loan at 1.50% p.a. above bank cost of funds Total loans and borrowings 2014 – – 500,000

3,010,053

2,600,000

3,433,333

Loan from directors The amounts due are non-trade in nature, unsecured, interest-free and repayable on demand and in cash. Bank loans Bank loans are secured by a first legal mortgage over the leasehold properties of the Group and several guarantees by the Company’s directors. The loan as at the end of reporting period is repayable by 36 monthly instalments, starting from June 2012.

A-36

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 17. Deferred tax liabilities Deferred tax liabilities as at 31 December relate to the following: 2010 $ Deferred tax liabilities: Differences in depreciation for tax purposes An analysis of the deferred taxes is as follows: At beginning of year Movements in deferred taxes – current year – over provision in respect of prior years At end of year (4,270) – 14,230 1,311 – 15,541 5,502 (1,619) 19,424 18,500 14,230 15,541 14,230 15,541 19,424 2011 $ 2012 $

18.

Share capital 2010 No. of shares Issued and fully paid ordinary shares: At 1 January and 31 December 400,016 400,016 400,016 400,016 400,016 400,016 2011 No. of shares 2012 No. of shares

$

$

$

The holders of ordinary shares are entitled to receive dividends as and when declared by the Company. All ordinary shares carry one vote per share without restrictions. The ordinary shares have no par value. The Company has not been incorporated as at 31 December 2012. Accordingly, the share capital of the Group refers to the paid-up capital of PS Fasteners Pte. Ltd.. Subsequent to 31 December 2012, the Company was incorporated on 30 April 2013 with 1 initial subscriber share of $1.00. Pursuant to the Restructuring Exercise, the Company acquired the entire equity interest in PS Fasteners Pte. Ltd. via the issue of 6,803,522 shares at $1.00 per share. In addition, the Company performed a share split. Consequently, the share capital of the Company becomes $6,803,523 comprising 47,600,000 ordinary shares.

A-37

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 19. Dividends 2010 $ Declared and paid during the financial year Dividends on ordinary shares: Interim exempt dividend for 2012: $1.00 (2011: $1.00; 2010: $1.00) per share Final exempt dividend for 2012: $1.00 (2011: $1.00; 2010: $1.00) per share 400,016 400,016 800,032 400,016 400,016 800,032 400,016 400,016 800,032 2011 $ 2012 $

The dividends have been declared by PS Fasteners Pte. Ltd. to its then existing shareholders prior to the Restructuring Exercise. The dividend per share is calculated based on the number of ordinary shares of PS Fasteners Pte. Ltd. in issue as at date of dividend declaration. 20. Significant related party transactions In addition to the related party information disclosed elsewhere in the combined financial statements, the following significant transactions between the Group and related parties took place at terms agreed between the parties during the financial year: Compensation of key management personnel 2010 $ Short-term employee benefits Central Provident Fund contributions 571,200 21,014 592,214 2011 $ 575,822 22,201 598,023 2012 $ 636,738 33,379 670,117

Comprise amounts paid to: Directors of the Company Other key management personnel 539,187 53,027 592,214 539,200 58,823 598,023 541,650 128,467 670,117

A-38

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 21. Fair value of financial instruments The fair value of a financial instrument is the amount at which the instrument could be exchanged or settled between knowledgeable and willing parties in an arm’s length transaction, other than in a forced or liquidation sale. (A) Fair value of financial instruments by classes that are not carried at fair value and whose carrying amounts are reasonable approximation of fair value Trade and other receivables (Note 13), cash and cash equivalents (Note 14), trade and other payables (Note 15), and current loans and borrowings (Note 16). The carrying amounts of these financial assets and liabilities are based on their nominal amount and are reasonable approximation of fair values, either due to their short term nature or are repayable on demand in cash. (B) Fair value of financial instruments by classes that are not carried at fair value and whose carrying amounts are not reasonable approximation of fair value The fair value of loans and borrowings is estimated by discounting expected future cash flows at market lending rates for similar type of borrowing arrangement at the end of the reporting period. Information regarding loans and borrowings is disclosed in Note 16. 2010 $ Carrying amount Fair value Financial liabilities: Loans and borrowings (non-current) 2011 $ Carrying amount Fair value 2012 $ Carrying Fair amount value









500,000 522,732

22.

Financial risk management objectives and policies The Group is exposed to financial risks arising from its operations and use of financial instruments. The key financial risks include credit risk, currency risk, liquidity risk and interest rate risk. The Group’s risk management policy seeks to minimise the potential adverse effects from these exposures. The management continually monitors the Group’s risk management process to ensure that an appropriate balance between risk and control is achieved. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Group’s activities.

A-39

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 22. Financial risk management objectives and policies (cont’d) The Board of Directors is responsible for setting the objectives, the underlying principles of financial risk management for the Group and establishing policies such as authority levels, oversight responsibilities, risk identification and measurement, exposure limits and hedging strategies, in accordance with the objectives and underlying principles approved. It is, and has been throughout the current and previous financial year, the Group’s policy that no trading in derivatives for speculative purposes shall be undertaken. There has been no change to the Group’s exposure to the following financial risks identified or the manner in which it manages and measures the risks. (a) Credit risk Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty default on its obligations. The Group’s exposure to credit risk arises primarily from trade and other receivables. For other financial assets (including cash and cash equivalents), the Group minimises credit risk by dealing exclusively with high credit rating counterparties. The Group’s objective is to seek continual revenue growth while minimising losses incurred due to increased credit risk exposure. The Group trades only with recognised and creditworthy third parties. It is the Group’s policy that all customers who wish to trade on credit terms are subject to credit verification procedures. In addition, receivable balances are monitored on an ongoing basis with the result that the Group’s exposure to bad debts is not significant. Excessive risk concentration Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in the same geographical region, or have economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative sensitivity of the Group’s performance to developments affecting a particular industry. In order to avoid excessive concentrations of risk, the Group’s policies and procedures include specific guidelines to focus on maintaining a diversified portfolio. Identified concentrations of credit risks are controlled and managed accordingly. Exposure to credit risk At the end of the reporting period, the Group has no significant exposure to a single customer.

A-40

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 22. Financial risk management objectives and policies (cont’d) (a) Credit risk (cont’d) Credit risk concentration profile The Group determines concentration of credit risk by monitoring the country profile of its trade receivables on an ongoing basis. The credit risk concentration profile of the Group’s trade receivables at the end of the reporting period is as follows: 2010 $ Malaysia Indonesia Singapore Other countries Total 715,160 558,442 350,321 191,167 1,815,090 % 39 31 19 11 100 $ 711,900 618,551 391,750 328,631 2,050,832 2011 % 35 30 19 16 100 $ 826,028 502,346 425,422 136,930 1,890,726 2012 % 44 27 23 6 100

Financial assets that are neither past due nor impaired Trade and other receivables that are neither past due nor impaired is due from creditworthy debtors with good payment record with the Group. Cash and cash equivalents that are neither past due nor impaired are placed with or entered into with reputable financial institutions. Financial assets that are either past due or impaired At the end of the reporting period, the Group has no receivables that are impaired. Information regarding financial assets that are past due is disclosed in Note 13 to the combined financial statements. (b) Liquidity risk Liquidity risk is the risk that the Group will encounter difficulty in meeting financial obligations due to shortage of funds. The Group’s exposure to liquidity risk arises primarily from mismatches of the maturities of financial assets and liabilities. It was the Group’s objective to maintain a balance between continuity of funding and flexibility through short-term banking facilities and borrowings from banks or directors in order to meet its liquidity requirements both in the short and long term. In the management of liquidity risk, the Group monitors and maintains a level of cash and cash equivalents deemed adequate by management to finance the Group’s operations. A-41

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 22. Financial risk management objectives and policies (cont’d) (b) Liquidity risk (cont’d) The table below summarises the maturity profile of the Group’s financial assets and liabilities at the end of the reporting period based on contractual undiscounted payments. One year or less $ 2010 Financial assets: Trade and other receivables Cash and cash equivalents Total undiscounted financial assets 1,944,928 843,382 2,788,310

Financial liabilities: Trade and other payables Loans and borrowings Total undiscounted financial liabilities Total net undiscounted financial liabilities 2011 Financial assets: Trade and other receivables Cash and cash equivalents Total undiscounted financial assets 2,218,799 191,725 2,410,524 1,922,947 3,010,053 4,933,000 (2,144,690)

Financial liabilities: Trade and other payables Loans and borrowings Total undiscounted financial liabilities Total net undiscounted financial liabilities 2,600,291 2,600,000 5,200,291 (2,789,767)

A-42

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 22. Financial risk management objectives and policies (cont’d) (b) Liquidity risk (cont’d) One year or less $ 2012 Financial assets: Trade and other receivables Cash and cash equivalents Total undiscounted financial assets Financial liabilities: Trade and other payables Loans and borrowings Total undiscounted financial liabilities Total net undiscounted financial liabilities 2,750,646 2,933,333 5,683,979 – 519,500 519,500 2,750,646 3,452,833 6,203,479 2,025,913 334,817 2,360,730 – – – 2,025,913 334,817 2,360,730 Two to five years $

Total $

(3,323,249)

(519,500)

(3,842,749)

(c)

Foreign currency risk Foreign currency risk arises when transactions are denominated in foreign currencies. The Group has transactional currency exposures arising mainly from sales and purchases that are denominated in a currency other than the respective functional currencies of the Group entities, primarily, Singapore Dollars (“SGD”). The foreign currency in which these transactions are denominated are mainly United States Dollars (“USD”). The Group’s objective is where possible to limit the effect of exchange rate movements on the Group’s earnings by closely monitoring the movement of exchange rate fluctuations but the Group does not use foreign currency forward exchange contracts or purchase currency options for trading purposes.

A-43

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 22. Financial risk management objectives and policies (cont’d) (c) Foreign currency risk (cont’d) Sensitivity analysis for foreign currency risk The following table demonstrates the sensitivity of the Group’s profit before tax to a reasonably possible change in the USD against the functional currency with all other variables held constant Profit before taxation 2010 2011 2012 $ $ $ USD – strengthened 10% (2011: 10%, 2010: 10%) – weakened 10% (2011: 10%, 2010: 10%) (53,075) 53,075 (92,276) 92,276 (30,653) 30,653

(d)

Interest rate risk Interest rate risk is the risk that the fair value or future cash flows of the Group’s financial instruments will fluctuate because of changes in market interest rates. The Group’s exposure to interest rate risk mainly arises from its loans and borrowings and trust receipts. Interest rate risk is managed by the Group on an on-going basis with the primary objective of limiting the extent to which net interest expense could be affected by an adverse movement in interest rates. The Group’s policy is to obtain the most favourable interest rates available for its borrowings and bank deposits. Sensitivity analysis for interest rate risk A change of 100 basis points in interest rate at the reporting date would increase/(decrease) profit after tax and equity by the amounts as shown below. This analysis assumes that all other variables, in particular foreign currency and tax rates, remain constant. At the end of the reporting period, if SGD interest rates had been 100 (2011: 100; 2010:100) basis points lower/higher with all other variables held constant, the Group’s profit before tax would have been $20,511 (2011: $16,376; 2010: $13,068) higher/lower. This arises mainly as a result of lower/higher interest expense on floating rate loans and borrowings and trust receipts, and higher/lower interest income from floating rate for cash at bank.

A-44

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 23. Capital management Capital includes debt and equity items as disclosed in the table below. The primary objective of the Group’s capital management is to ensure that it maintains a healthy capital ratio in order to support its business and maximise shareholder value. The Group manages its capital structure and makes adjustments to it, in light of changes in economic conditions. To maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Group reviews its capital structure at least annually. The capital structure of the Group comprises issued capital and retained earnings. No changes were made in the objectives, policies or processes during the financial years ended 31 December 2010, 2011 and 2012. 2010 $ Loans and borrowings (Note 16) Trade and other payables (Note 15) Less: Cash and cash equivalents (Note 14) Net debt Equity attributable to the owners of the Company Total capital Capital and net debt Gearing ratio 3,010,053 1,922,947 (843,382) 4,089,618 2011 $ 2,600,000 2,600,291 (191,725) 5,008,566 2012 $ 3,433,333 2,750,646 (334,817) 5,849,162

6,007,061 6,007,061 10,096,679 41%

6,511,317 6,511,317 11,519,883 43%

6,803,522 6,803,522 12,652,684 46%

A-45

APPENDIX A – AUDITED COMBINED FINANCIAL STATEMENTS OF PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
PS GROUP HOLDINGS LTD. AND ITS SUBSIDIARY NOTES TO THE COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 24. Segment information The Group has only one operating segment in the import and export of bolts, nuts, rivets, fasteners and screw machine products. Management has not identified any business or operating units separately for purpose of making decisions about resource allocation and performance assessment. Geographical information Revenue based on the geographical location of customers is as follows: 2010 $ Indonesia Malaysia Singapore Other countries 3,366,249 3,099,198 1,970,352 3,555,683 11,991,482 2011 $ 3,585,475 2,870,448 2,000,567 4,046,090 12,502,580 2012 $ 3,055,498 3,093,705 2,202,897 3,941,162 12,293,262

All non-current assets are located in Singapore, the Group’s country of domicile. Information about a major customer Revenue from a major customer amounts to $1,177,985 (2011: $1,369,262; 2010: $1,363,019). 25. Authorisation of combined financial statements The combined financial statements for the financial years ended 31 December 2010, 2011 and 2012 were authorised for issue in accordance with a resolution of the directors on 3 July 2013.

A-46

APPENDIX B – DESCRIPTION OF ORDINARY SHARES
The following statements are brief summaries of the rights and privileges of Shareholders conferred by the laws of Singapore and the Articles of our Company. These statements summarise the material provisions of the Articles and are qualified in entirety by reference to the Articles, a copy of which will be available for inspection at our registered office during normal business hours for a period of six months from the date of registration of this Offer Document. 1. Ordinary Shares There are no founders, management, deferred or unissued shares reserved for issue for any purpose. We have only one class of shares, namely, our ordinary shares which have identical rights in all respects and rank equally with one another. All of the Shares are in registered form. We may, subject to the provisions of the Companies Act and the rules of the SGX-ST, purchase our own Shares. However, we may not, except in circumstances permitted by the Companies Act, grant any financial assistance for the acquisition or proposed acquisition of our own Shares. 2. New Shares New Shares may only be issued with the prior approval in a general meeting of our Shareholders. The aggregate number of Shares to be issued pursuant to such approval may not exceed 100% (or such other limit as may be prescribed by the SGX-ST) of our issued share capital for the time being, of which the aggregate number of shares to be issued other than on a pro-rata basis to our Shareholders shall not exceed 50% (or such other limit as may be prescribed by the SGX-ST) of our issued share capital for the time being (the percentage of issued share capital being based on our issued Shares at the time such authority is given after adjusting for new Shares arising from the conversion of convertible securities or employee share options on issue at the time such authority is given and any subsequent consolidation or sub-division of Shares). The approval, if granted, will lapse at the conclusion of the annual general meeting following the date on which the approval was granted or the date by which the annual general meeting is required by law to be held, whichever is the earlier but any approval may be previously revoked or varied by Shareholders in general meeting. Subject to the foregoing, the provisions of the Companies Act and any special rights attached to any class of shares currently issued, all new Shares are under the control of our Board who may allot and issue the same with such rights and restrictions as it may think fit. 3. Shareholders Only persons who are registered in the register of Shareholders of our Company and, in cases in which the person so registered is CDP, the persons named as the Depositors in the Depository Register maintained by CDP for the Shares, are recognised as our Shareholders. Our Company will not, except as required by law, recognise any equitable, contingent, future or partial interest in any Share or other rights for any Share other than the absolute right thereto of the registered holder of that Share or of the person whose name is entered in the Depository Register for that Share. Our Company may close the register of Shareholders for any time or times if we provide the SGX-ST at least five clear market days’ notice. However, the register of Shareholders may not be closed for more than 30 days in aggregate in any calendar year. Our Company typically closes the register of Shareholders to determine Shareholders’ entitlement to receive dividends and other distributions.

B-1

APPENDIX B – DESCRIPTION OF ORDINARY SHARES
4. Transfer of Shares There is no restriction on the transfer of fully paid Shares except where required by law or the Listing Manual or the rules or by-laws of any stock exchange on which our Company is listed. Our Board may decline to register any transfer of Shares which are not fully paid Shares, or Shares on which our Company has a lien. Our Shares may be transferred by a duly signed instrument of transfer in a form approved by the SGX-ST or any stock exchange on which our Company is listed. Our Board may also decline to register any instrument of transfer unless, among other things, it has been duly stamped and is presented for registration together with the share certificate and such other evidence of title as it may require. Our Company will replace lost or destroyed certificates for Shares if it is properly notified and if the applicant pays a fee which will not exceed S$2 and furnishes any evidence and indemnity that our Board may require. 5. General Meetings of Shareholders Our Company is required to hold an annual general meeting every year. Our Board may convene an extraordinary general meeting whenever it thinks fit and must do so if Shareholders representing not less than 10% of the total voting rights of all Shareholders request in writing that such a meeting be held. In addition, two or more Shareholders holding not less than 10% of the issued share capital of our Company (excluding treasury shares) may call a meeting. Unless otherwise required by law or by our Articles, voting at general meetings is by ordinary resolution, requiring an affirmative vote of a simple majority of the votes cast at that meeting. An ordinary resolution suffices, for example, for the appointment of directors. A special resolution, requiring the affirmative vote of at least 75% of the votes cast at the meeting, is necessary for certain matters under Singapore law, including voluntary winding up, amendments to the Memorandum of Association and our Articles, a change of the corporate name and a reduction in the share capital. Our Company must give at least 21 days’ notice in writing for every general meeting convened for the purpose of passing a special resolution. Ordinary resolutions generally require at least 14 days’ notice in writing. The notice must be given to every Shareholder who has supplied our Company with an address in Singapore for the giving of notices and must set forth the place, the day and the hour of the meeting and, in the case of special business, the general nature of that business. 6. Voting Rights A Shareholder is entitled to attend, speak and vote at any general meeting, in person or by proxy. Proxies need not be Shareholders. A person who holds Shares through the SGX-ST book-entry settlement system will only be entitled to vote at a general meeting as a Shareholder if his name appears on the Depository Register maintained by CDP 48 hours before the general meeting. Except as otherwise provided in our Articles, two or more Shareholders must be present in person or by proxy to constitute a quorum at any general meeting. Under the Articles, on a show of hands, every Shareholder present in person and by proxy shall have one vote (provided that in the case of a Shareholder who is represented by two proxies, only one of the two proxies as determined by that Shareholder or, failing such determination, by the Chairman of the meeting in his sole discretion shall be entitled to vote on a show of hands), and on a poll, every Shareholder present in person or by proxy shall have one vote for each Share which he holds or represents. A poll may be demanded in certain circumstances, including by the chairman of the meeting or by any Shareholder or Shareholders present in person or by proxy and representing not less than 10% of the total voting rights of all Shareholders having the right to attend and vote at the meeting or by not less than two Shareholders present in person or by proxy and entitled to vote. In the case of an equality of vote, whether on a show of hands or a poll, the chairman of the meeting shall be entitled to a casting vote. B-2

APPENDIX B – DESCRIPTION OF ORDINARY SHARES
7. Dividends Our Company may, by ordinary resolution of our Shareholders, declare dividends at a general meeting, but we may not pay dividends in excess of the amount recommended by our Board. We must pay all dividends out of our profits. Our Board may also declare an interim dividend without the approval of our Shareholders. All dividends are paid pro-rata among our Shareholders in proportion to the amount paid up on each Share, unless the rights attaching to an issue of any Share provide otherwise. Unless otherwise directed, dividends are paid by cheque or warrant sent through the post to each Shareholder at his registered address. Notwithstanding the foregoing, the payment by our Company to CDP of any dividend payable to a Shareholder whose name is entered in the Depository Register shall, to the extent of payment made to CDP, discharge our Company from any liability to that Shareholder in respect of that payment. 8. Bonus and Rights Issues Our Board may, with approval by our Shareholders at a general meeting, capitalise any reserves or profits and distribute the same as bonus Shares credited as paid-up to our Shareholders in proportion to their shareholdings. Our Board may also issue rights to take up additional Shares to Shareholders in proportion to their shareholdings. Such rights are subject to any conditions attached to such issue and the regulations of any stock exchange on which our Company is listed. 9. Take-overs Under the Singapore Code on Take-overs and Mergers (“ Singapore Take-over Code ”), issued by the Authority pursuant to section 321 of the SFA, any person acquiring an interest, either on his own or together with parties acting in concert with him, in 30% or more of the voting Shares must extend a takeover offer for the remaining voting Shares in accordance with the provisions of the Singapore Take-over Code. In addition, a mandatory takeover offer is also required to be made if a person holding, either on his own or together with parties acting in concert with him, between 30% and 50% of the voting rights acquires additional voting shares representing more than 1% of the voting shares in any six month period. Under the Singapore Take-over Code, the following individuals and companies will be presumed to be persons acting in concert with each other unless the contrary is established: (a) the following companies: (i) (ii) a company; the parent company of (i);

(iii) the subsidiaries of (i); (iv) the fellow subsidiaries of (i); (v) the associated companies of (i), (ii), (iii) or (iv);

(vi) companies whose associated companies include any of (i), (ii), (iii), (iv) or (v); and (vii) any person who has provided financial assistance (other than a bank in the ordinary course of business) to any of the above for the purchase of voting rights; B-3

APPENDIX B – DESCRIPTION OF ORDINARY SHARES
(b) a company with any of its directors (together with their close relatives, related trusts as well as companies controlled by any of the directors, their close relatives and related trusts); a company with any of its pension funds and employee share schemes; a person with any investment company, unit trust or other fund whose investment such person manages on a discretionary basis, but only in respect of the investment account which such person manages; a financial or other professional adviser, including a stockbroker, with its customer in respect of the shareholdings of: (i) the adviser and persons controlling, controlled by or under the same control as the adviser; and all the funds which the adviser manages on a discretionary basis, where the shareholdings of the adviser and any of those funds in the customer total 10% or more of the customer’s equity share capital;

(c) (d)

(e)

(ii)

(f)

directors of a company (together with their close relatives, related trusts and companies controlled by any of such directors, their close relatives and related trusts) which is subject to an offer or where the directors have reason to believe a bona fide offer for their company may be imminent; partners; and the following persons and entities: (i) (ii) an individual; the close relatives of (i);

(g) (h)

(iii) the related trusts of (i); (iv) any person who is accustomed to act in accordance with the instructions of (i); (v) companies controlled by any of (i), (ii), (iii) or (iv); and

(vi) any person who has provided financial assistance (other than a bank in the ordinary course of business) to any of the above for the purchase of voting rights. Under the Singapore Take-over Code, a mandatory offer made with consideration other than cash must be accompanied by a cash alternative at not less than the highest price paid by the offeror or any person acting in concert within the preceding six months. 10. Liquidation or Other Return of Capital If our Company is liquidated or in the event of any other return of capital, holders of Shares will be entitled to participate in any surplus assets in proportion to their shareholdings, subject to any special rights attaching to any other class of shares.

B-4

APPENDIX B – DESCRIPTION OF ORDINARY SHARES
11. Indemnity As permitted by Singapore law, our Articles provide that, subject to the Companies Act, our Board and officers shall be entitled to be indemnified by our Company against any liability incurred in defending any proceedings, whether civil or criminal, which relate to anything done or omitted to have been done as an officer, director or employee and in which judgment is given in their favour or in which they are acquitted or in connection with any application under any statute for relief from liability in respect thereof in which relief is granted by the court. Our Company may not indemnify our Directors and officers against any liability which by law would otherwise attach to them in respect of any negligence, default, breach of duty or breach of trust of which they may be guilty in relation to our Company. 12. Limitations on Rights to Hold or Vote Shares Except as described in “ Voting Rights ” and “ Take-overs ” above, there are no limitations imposed by Singapore law or by our Articles on the rights of non-resident Shareholders to hold or vote in respect of our Shares. 13. Minority Rights The rights of minority Shareholders of Singapore-incorporated companies are protected under Section 216 of the Companies Act, which gives the Singapore courts a general power to make any order, upon application by any Shareholder of our Company, as they think fit to remedy any of the following situations: (a) our affairs are being conducted or the powers of our Board are being exercised in a manner oppressive to, or in disregard of the interests of, one or more of our Shareholders; or we take an action, or threaten to take an action, or our Shareholders pass a resolution, or propose to pass a resolution, which unfairly discriminates against, or is otherwise prejudicial to, one or more of our Shareholders, including the applicant.

(b)

Singapore courts have wide discretion as to the reliefs they may grant and those reliefs are in no way limited to those listed in the Companies Act itself. Without prejudice to the foregoing, Singapore courts may: (a) (b) (c) direct or prohibit any act or cancel or vary any transaction or resolution; regulate the conduct of our affairs in the future; authorise civil proceedings to be brought in the name of, or on behalf of, our Company by a person or persons and on such terms as the court may direct; provide for the purchase of a minority Shareholder’s shares by our other Shareholders or by us and, in the case of a purchase of Shares by us, a corresponding reduction of our share capital; provide that our Memorandum of Association or our Articles be amended; or provide that we be wound up.

(d)

(e) (f)

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APPENDIX B – DESCRIPTION OF ORDINARY SHARES
14. Substantial Shareholders The Securities and Futures Act requires our Substantial Shareholders to give notice to us of certain information as prescribed by the Authority, including particulars of their interest, within two business days of becoming aware of being our Substantial Shareholders or ceasing to be our Substantial Shareholder and being aware of any change in the percentage level of their interest. “Percentage level”, in relation to a Substantial Shareholder, is the percentage figure ascertained by expressing the total votes attached to all the voting shares in which the Substantial Shareholder has an interest (or interests) immediately before or (as the case may be) immediately after the relevant time, as a percentage of the total votes attached to all of the voting shares (excluding treasury shares), and if it is not a whole number, rounding that figure down to the next whole number. Under the Securities and Futures Act, a person has a substantial shareholding in us if he has an interest (or interests) in one or more of our voting shares (excluding treasury shares) and the total votes attached to those shares are not less than 5.0% of the total votes attached to all of our voting shares (excluding treasury shares).

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APPENDIX C – SUMMARY OF SELECTED ARTICLES OF ASSOCIATION OF OUR COMPANY
The discussion below provides information about certain provisions of our Articles of Association. This description is only a summary and is qualified in entirety by reference to the Articles, a copy of which will be available for inspection at our registered office during normal business hours for a period of six months from the date of registration of this Offer Document. The following are extracts of the provisions in our Articles relating to: 1. A director’s power to vote on a proposal, arrangement or contract in which he is interested Article 90(1) – Powers of Directors to contract with Company No Director or intending Director shall be disqualified by his office from contracting or entering into any arrangement with the Company either as vendor, purchaser or otherwise nor shall such contract or arrangement or any contract or arrangement entered into by or on behalf of the Company in which any Director shall be in any way interested be avoided nor shall any Director so contracting or being so interested be liable to account to the Company for any profit realised by any such contract or arrangement by reason only of such Director holding that office or of the fiduciary relation thereby established but every Director shall observe the provisions of Section 156 of the Companies Act relating to the disclosure of the interests of the Directors in transactions or proposed transactions with the Company or of any office or property held by a Director which might create duties or interests in conflict with his duties or interests as a Director and any transactions to be entered into by or on behalf of the Company in which any Director shall be in any way interested shall be subject to any requirements that may be imposed by the Exchange. No Director shall vote in respect of any contract, arrangement or transaction in which he has directly or indirectly a personal material interest as aforesaid or in respect of any allotment of shares in or debentures of the Company to him and if he does so vote his vote shall not be counted. Article 90(2) – Relaxation of restriction on voting A Director, notwithstanding his interest, may be counted in the quorum present at any meeting where he or any other Director is appointed to hold any office or place of profit under the Company, or where the Directors resolve to exercise any of the rights of the Company (whether by the exercise of voting rights or otherwise) to appoint or concur in the appointment of a Director to hold any office or place of profit under any other company, or where the Directors resolve to enter into or make any arrangements with him or on his behalf pursuant to these Articles or where the terms of any such appointment or arrangements as hereinbefore mentioned are considered, and he may vote on any such matter other than in respect of the appointment of or arrangements with himself or the fixing of the terms thereof. Article 91(3) – Exercise of voting power The Directors may exercise the voting power conferred by the shares in any company held or owned by the Company in such manner and in all respects as the Directors think fit in the interests of the Company (including the exercise thereof in favour of any resolution appointing the Directors or any of them to be directors of such company or voting or providing for the payment of remuneration to the directors of such company) and any such Director of the Company may vote in favour of the exercise of such voting powers in the manner aforesaid notwithstanding that he may be or be about to be appointed a director of such other company.

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APPENDIX C – SUMMARY OF SELECTED ARTICLES OF ASSOCIATION OF OUR COMPANY
2. A director’s power to vote on remuneration (including pension or other benefits) for himself or for any other director and whether the quorum at a meeting of the board of directors to vote on directors’ remuneration may include the director whose remuneration is the subject of the vote Article 86(1) – Fees The fees of the Directors shall be determined from time to time by the Company in general meetings and such fees shall not be increased except pursuant to an ordinary resolution passed at a general meeting where notice of the proposed increase shall have been given in the notice convening the meeting. Such fees shall be divided among the Directors in such proportions and manner as they may agree and in default of agreement equally, except that in the latter event any Director who shall hold office for part only of the period in respect of which such fee is payable shall be entitled only to rank in such division for the proportion of fee related to the period during which he has held office. Article 86(2) – Extra remuneration Any Director who is appointed to any executive office or serves on any committee or who otherwise performs or renders services, which, in the opinion of the Directors, are outside his ordinary duties as a Director, may be paid such extra remuneration as the Directors may determine, subject however as is hereinafter provided in this Article. Article 86(3) – Remuneration of director The fees (including any remuneration under Article 86(2) above) in the case of a Director other than an Executive Director shall be payable by a fixed sum and shall not at any time be by commission on or percentage of the profits or turnover, and no Director whether an Executive Director or otherwise shall be remunerated by a commission on or percentage of turnover. Article 87 – Expenses The Directors shall be entitled to be repaid all travelling or such reasonable expenses as may be incurred in attending and returning from meetings of the Directors or of any committee of the Directors or general meetings or otherwise howsoever in or about the business of the Company in the course of the performance of their duties as Directors. Article 88 – Pensions to directors and dependents Subject to the Companies Act, the Directors on behalf of the Company may pay a gratuity or other retirement, superannuation, death or disability benefits to any Director or former Director who had held any other salaried office or place of profit with the Company or to his widow or dependants or relations or connections or to any persons in respect of and may make contributions to any fund and pay premiums for the purchase or provision of any such gratuity, pension or allowance.

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APPENDIX C – SUMMARY OF SELECTED ARTICLES OF ASSOCIATION OF OUR COMPANY
Article 89 – Benefits for employees The Directors may procure the establishment and maintenance of or participate in or contribute to any non-contributory or contributory pension or superannuation fund or life assurance scheme or any other scheme whatsoever for the benefit of and pay, provide for or procure the grant of donations, gratuities, pensions, allowances, benefits or emoluments to any persons (including Directors and other officers) who are or shall have been at any time in the employment or service of the Company or of the predecessors in business of the Company or of any subsidiary company, and the wives, widows, families or dependants of any such persons. The Directors may also procure the establishment and subsidy of or subscription and support to any institutions, associations, clubs, funds or trusts calculated to be for the benefit of any such persons as aforesaid or otherwise to advance the interests and well-being of the Company or of any such other company as aforesaid or of its Members and payment for or towards the insurance of any such persons as aforesaid, and subscriptions or guarantees of money for charitable or benevolent objects or for any exhibition or for any public, general or useful object. Article 94 – Remuneration of Chief Executive Officer/Managing Director The remuneration of a Chief Executive Officer/Managing Director (or any Director holding an equivalent appointment) shall from time to time be fixed by the Directors and may subject to these Articles be by way of salary or commission or participating in profits or by any or all of these modes but he shall not under any circumstances be remunerated by a commission on or a percentage of turnover. Article 103(1) – Alternate Directors Any Director of the Company may at any time appoint any person who is not a Director or alternate Director and who is approved by a majority of his co-Directors to be his alternate Director for such period as he thinks fit and may at any time remove any such alternate Director from office. An alternate Director so appointed shall be entitled to receive from the Company such proportion (if any) of the remuneration otherwise payable to his appointor as such appointor may by notice in writing to the Company from time to time direct, but save as aforesaid he shall not in respect of such appointment be entitled to receive any remuneration from the Company. Any fee paid to an alternate Director shall be deducted from the remuneration otherwise payable to his appointor. 3. The borrowing powers exercisable by the directors and how such borrowing powers may be varied Article 118 – Directors’ borrowing powers The Directors may at their discretion exercise all the powers of the Company to borrow or otherwise raise money, to mortgage, charge or hypothecate all or any property or business of the Company including any uncalled or called but unpaid capital and to issue debentures or give any other security for any debt or obligation of the Company or of any third party.

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APPENDIX C – SUMMARY OF SELECTED ARTICLES OF ASSOCIATION OF OUR COMPANY
4. The retirement or non-retirement of a director under an age limit requirement Article 93 – Chief Executive Officer/Managing Director to be subject to retirement by rotation Any Director who is appointed as a Chief Executive Officer/Managing Director (or an equivalent appointment) shall be subject to the same provisions as to retirement by rotation, resignation and removal as the other Directors of the Company. The appointment of any Director to the office of Chief Executive Officer/Managing Director (or any Director holding an equivalent appointment) shall not automatically determine if he ceases from any cause to be a Director, unless the contract or resolution under which he holds office shall expressly state otherwise, in which event such determination shall be without prejudice to any claim for damages for breach of any contract of service between him and the Company. Article 96(1)(viii) – Vacation of office of director Subject as herein otherwise provided or to the terms of any subsisting agreement, the office of a Director shall be vacated subject to the provisions of the Companies Act, at the conclusion of the Annual General Meeting commencing next after he attains the age of seventy (70) years. Article 98 – Retirement of directors by rotation Subject to these Articles and to the Companies Act, at each Annual General Meeting at least one-third of the Directors for the time being (or, if their number is not a multiple of three (3), the number nearest to but not less than one-third) shall retire from office by rotation. Provided that all Directors shall retire from office at least once every three (3) years. Article 99 – Selection of directors to retire The Directors to retire by rotation shall include (so far as necessary to obtain the number required) any Director who is due to retire at the meeting by reason of age or who wishes to retire and not to offer himself for re-election. Any further Directors so to retire shall be those of the other Directors subject to retirement by rotation who have been longest in office since their last re-election or appointment or have been in office for the three (3) years since their last election. However as between persons who became or were last re-elected Directors on the same day, those to retire shall (unless they otherwise agree among themselves) be determined by lot. A retiring Director shall be eligible for re-election. Article 100 – Deemed re-elected The Company at the meeting at which a Director retires under any provision of these Articles may by ordinary resolution fill up the vacated office by electing a person thereto. In default the retiring Director shall be deemed to have been re-elected, unless: (i) at such meeting it is expressly resolved not to fill up such vacated office or a resolution for the re-election of such Director is put to the meeting and lost; or such Director is disqualified under the Companies Act from holding office as a Director or has given notice in writing to the Company that he is unwilling to be re-elected;

(ii)

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APPENDIX C – SUMMARY OF SELECTED ARTICLES OF ASSOCIATION OF OUR COMPANY
(iii) such Director is disqualified from acting as a director in any jurisdiction for reasons other than on technical grounds; or (iv) such Director has attained any retiring age applicable to him as a Director. 5. The number of shares, if any, required for the qualification of a director Article 85 – Qualifications A Director need not be a Member and shall not be required to hold any share qualification in the Company and shall be entitled to attend and speak at general meetings but subject to the provisions of the Companies Act he shall not be of or over the age of seventy (70) years at the date of his appointment. 6. The rights, preferences and restrictions attaching to each class of shares Article 4 – Issue of new shares Subject to the Companies Act and these Articles, no shares may be issued by the Directors without the prior sanction of an ordinary resolution of the Company in general meeting but subject thereto and to Article 47, and to any special rights attached to any shares for the time being issued, the Directors may issue, allot or grant options over or otherwise deal with or dispose of the same to such persons on such terms and conditions and for such consideration and at such time and subject or not to the payment of any part of the amount thereof in cash as the Directors may think fit, and any shares may be issued in such denominations or with such preferential, deferred, qualified or special rights, privileges or conditions as the Directors may think fit, and preference shares may be issued which are or at the option of the Company are liable to be redeemed, the terms and manner of redemption being determined by the Directors. Article 5(1) – Rights attached to certain shares Preference shares may be issued subject to such limitations thereof as may be prescribed by any stock exchange upon which shares in the Company may be listed and the rights attaching to shares other than ordinary shares shall be expressed in the Memorandum of Association or these Articles. The total number of issued preference shares shall not exceed the total number of issued ordinary shares at any time. Preference shareholders shall have the same rights as ordinary shareholders as regards receiving of notices, reports and balance sheets and attending general meetings of the Company. Preference shareholders shall also have the right to vote at any meeting convened for the purpose of reducing the capital or winding up or sanctioning a sale of the undertaking of the Company or where the proposal to be submitted to the meeting directly affects their rights and privileges or when the dividend on the preference shares is more than six (6) months in arrears. Article 5(2) The Company has power to issue further preference capital ranking equally with, or in priority to, preference shares from time to time already issued or about to be issued.

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APPENDIX C – SUMMARY OF SELECTED ARTICLES OF ASSOCIATION OF OUR COMPANY
Article 7(2) – Rights of preference shareholders The repayment of preference capital other than redeemable preference or any other alteration of preference shareholder rights, may only be made pursuant to a special resolution of the preference shareholders concerned. Provided always that where the necessary majority for such a special resolution is not obtained at the general meeting, consent in writing if obtained from the holders of three-fourths of the preference shares concerned within two (2) months of the general meeting, shall be as valid and effectual as a special resolution carried at the general meeting. Article 16(1) – Entitlement to certificate Shares must be allotted and certificates despatched within ten (10) market days of the final closing date for an issue of shares unless the Exchange shall agree to an extension of time in respect of that particular issue. The Depository must despatch statements to successful investor applicants confirming the number of shares held under their Securities Accounts. Persons entered in the Register of Members as registered holders of shares shall be entitled to certificates within ten (10) market days after lodgement of any transfer. Every registered shareholder shall be entitled to receive share certificates in reasonable denominations for his holding and where a charge is made for certificates, such charge shall not exceed S$2 (or such other fee as the Directors may determine having regard to any limitation thereof as may be prescribed by any stock exchange upon which the shares of the Company may be listed). Where a registered shareholder transfers part only of the shares comprised in a certificate or where a registered shareholder requires the Company to cancel any certificate or certificates and issue new certificates for the purpose of subdividing his holding in a different manner the old certificate or certificates shall be cancelled and a new certificate or certificates for the balance of such shares issued in lieu thereof and the registered shareholder shall pay a fee not exceeding S$2 (or such other fee as the Directors may determine having regard to any limitation thereof as may be prescribed by any stock exchange upon which the shares of the Company may be listed) for each such new certificate as the Directors may determine. Where the member is a Depositor the delivery by the Company to the Depository of provisional allotments or share certificates in respect of the aggregate entitlements of Depositors to new shares offered by way of rights issue or other preferential offering or bonus issue shall to the extent of the delivery discharge the Company from any further liability to each such Depositor in respect of his individual entitlement. Article 21(1) – Directors’ power to decline to register Subject to these Articles, there shall be no restriction on the transfer of fully paid up shares except where required by law or by the rules, bye-laws or listing rules of the Exchange but the Directors may in their discretion decline to register any transfer of shares upon which the Company has a lien and in the case of shares not fully paid up may refuse to register a transfer to a transferee of whom they do not approve. If the Directors shall decline to register any such transfer of shares, they shall give to both the transferor and the transferee written notice of their refusal to register as required by the Companies Act and the listing rules of the Exchange.

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APPENDIX C – SUMMARY OF SELECTED ARTICLES OF ASSOCIATION OF OUR COMPANY
Article 47 – Rights and privileges of new shares Subject to any special rights for the time being attached to any existing class of shares, the new shares shall be issued upon such terms and conditions and with such rights and privileges annexed thereto as the general meeting resolving upon the creation thereof shall direct and if no direction be given as the Directors shall determine; subject to the provisions of these Articles and in particular (but without prejudice to the generality of the foregoing) such shares may be issued with a preferential or qualified right to dividends and in the distribution of assets of the Company or otherwise. Article 71(1) – Voting rights of Members Subject and without prejudice to any special privileges or restrictions as to voting for the time being attached to any special class of shares for the time being forming part of the capital of the Company and to Article 6, each Member entitled to vote may vote in person or by proxy or attorney, and (in the case of a corporation) by a representative. A person entitled to more than one (1) vote need not use all his votes or cast all the votes he uses in the same way. Article 71(3) Notwithstanding anything contained in these Articles, a Depositor shall not be entitled to attend any general meeting and to speak and vote thereat unless his name is certified by the Depository to the Company as appearing on the Depository Register not later than forty-eight (48) hours before the time of the relevant general meeting (the cut-off time) as a Depositor on whose behalf the Depository holds shares in the Company. For the purpose of determining the number of votes which a Depositor or his proxy may cast on a poll, the Depositor or his proxy shall be deemed to hold or represent that number of shares entered in the Depositor’s Securities Account at the cut-off time as certified by the Depository to the Company, or where a Depositor has apportioned the balance standing to his Securities Account as at the cut-off time between two (2) proxies, to apportion the said number of shares between the two (2) proxies in the same proportion as specified by the Depositor in appointing the proxies; and accordingly no instrument appointing a proxy of a Depositor shall be rendered invalid merely by reason of any discrepancy between the number of shares standing to the credit of that Depositor’s Securities Account as at the cut-off time, and the true balance standing to the Securities Account of a Depositor as at the time of the relevant general meeting, if the instrument is dealt with in such manner as aforesaid. Article 72 – Voting rights of joint holders Where there are joint holders of any share any one (1) of such persons may vote and be reckoned in a quorum at any meeting either personally or by proxy or by attorney or in the case of a corporation by a representative as if he were solely entitled thereto but if more than one (1) of such joint holders is so present at any meeting then the person present whose name stands first in the Register of Members or the Depository Register (as the case may be) in respect of such share shall alone be entitled to vote in respect thereof. Several executors or administrators of a deceased Member in whose name any share stands shall for the purpose of this Article be deemed joint holders thereof.

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APPENDIX C – SUMMARY OF SELECTED ARTICLES OF ASSOCIATION OF OUR COMPANY
Article 73 – Voting rights of members of unsound mind If a Member be a lunatic, idiot or non-compos mentis, he may vote whether on a show of hands or on a poll by his committee, curator bonis or such other person as properly has the management of his estate and any such committee, curator bonis or other person may vote by proxy or attorney, provided that such evidence as the Directors may require of the authority of the person claiming to vote shall have been deposited at the Office not less than forty-eight (48) hours before the time appointed for holding the meeting. Article 74 – Right to vote Subject to the provisions of these Articles, every Member either personally or by proxy or by attorney or in the case of a corporation by a representative shall be entitled to be present and to vote at any general meeting and to be reckoned in the quorum thereat in respect of shares fully paid and in respect of partly paid shares where calls are not due and unpaid. In the event a member has appointed more than one (1) proxy, only one (1) proxy is counted in determining the quorum. 7. Any change in capital Article 50(1) – Power to consolidate, cancel and subdivide shares The Company may by ordinary resolution alter its share capital in the manner permitted under the Companies Act including without limitation: (i) (ii) consolidate and divide all or any of its shares; cancel the number of shares which, at the date of the passing of the resolution, have not been taken or agreed to be taken by any person or which have been forfeited and diminish its share capital in accordance with the Companies Act;

(iii) subdivide its shares or any of them (subject to the provisions of the Companies Act), Provided always that in such subdivision the proportion between the amount paid and the amount (if any) unpaid on each reduced share shall be the same as it was in the case of the share from which the reduced share is derived; and (iv) subject to the provisions of these Articles and the Companies Act, convert any class of shares into any other class of shares. Article 50(2) – Repurchase of Company’s shares The Company may purchase or otherwise acquire its issued shares subject to and in accordance with the provisions of the Companies Act and any other relevant rule, law or regulation enacted or promulgated by any relevant competent authority from time to time (collectively, the “ Relevant Laws ”), on such terms and subject to such conditions as the Company may in general meeting prescribe in accordance with the Relevant Laws. Any shares purchased or acquired by the Company as aforesaid may be cancelled or held as treasury shares and dealt with in accordance with the Relevant Laws. On the cancellation of any share as aforesaid, the rights and privileges attached to that share shall expire. In any

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APPENDIX C – SUMMARY OF SELECTED ARTICLES OF ASSOCIATION OF OUR COMPANY
other instance, the Company may hold or deal with any such share which is so purchased or acquired by it in such manner as may be permitted by, and in accordance with, the Companies Act. Article 51 – Power to reduce capital The Company may by special resolution reduce its share capital or any other undistributable reserve in any manner subject to any requirements and consents required by law. Without prejudice to the generality of the foregoing, upon cancellation of any share purchased or otherwise acquired by the Company pursuant to these presents and the Companies Act, the number of issued shares of the Company shall be diminished by the number of shares so cancelled, and where any such cancelled shares were purchased or acquired out of the capital of the Company, the amount of the share capital of the Company shall be reduced accordingly. 8. Any change in the respective rights of the various classes of shares including the action necessary to change the rights, indicating where the conditions are different from those required by the applicable law Article 7(1) – Variation of rights If at any time the share capital is divided into different classes, the repayment of preference capital other than redeemable preference capital and the rights attached to any class (unless otherwise provided by the terms of issue of the shares of that class) may, subject to the provisions of the Companies Act, whether or not the Company is being wound up, only be made, varied or abrogated with the sanction of a special resolution passed at a separate general meeting of the holders of shares of the class and to every such special resolution, the provisions of Section 184 of the Companies Act shall, with such adaptations as are necessary, apply. To every such separate general meeting, the provisions of these Articles relating to general meetings shall mutatis mutandis apply; but so that the necessary quorum shall be two (2) persons at least holding or representing by proxy or by attorney one-third of the issued shares of the class and that any holder of shares of the class present in person or by proxy or by attorney may demand a poll. Provided always that where the necessary majority for such a special resolution is not obtained at the general meeting, consent in writing if obtained from the holders of three-fourths of the issued shares of the class concerned within two (2) months of the general meeting shall be as valid and effectual as a special resolution carried at the general meeting. Article 8 – Creation or issue of further shares with special rights The rights conferred upon the holders of the shares of any class issued with preferred or other rights shall, unless otherwise expressly provided by the terms of issue of the shares of that class or by these Articles, be deemed to be varied by the creation or issue of further shares ranking equally therewith.

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APPENDIX C – SUMMARY OF SELECTED ARTICLES OF ASSOCIATION OF OUR COMPANY
9. Any time limit after which a dividend entitlement will lapse and an indication of the party in whose favour this entitlement operates Article 130(1) – Unclaimed dividends The payment by the Directors of any unclaimed dividends or other monies payable on or in respect of a share into a separate account shall not constitute the Company a trustee in respect thereof. All dividends unclaimed after being declared may be invested or otherwise made use of by the Directors for the benefit of the Company and any dividend unclaimed after a period of six (6) years from the date of declaration of such dividend may be forfeited and if so shall revert to the Company but the Directors may at any time thereafter at their absolute discretion annul any such forfeiture and pay the dividend so forfeited to the person entitled thereto prior to the forfeiture. For the avoidance of doubt no Member shall be entitled to any interest, share of revenue or other benefit arising from any unclaimed dividends, howsoever and whatsoever. If the Depositor returns any such dividend or money to the Company, the relevant Depositor shall not have any right or claim in respect of such dividend or money against the Company if a period of six (6) years has elapsed from the date of the declaration of such dividend or the date on which such other money was first payable. 10. Any limitation on the right to own shares including limitations on the right of non-resident or foreign shareholders to hold or exercise voting rights on the shares Article 11 – No trust recognised Except as required by law, no person shall be recognised by the Company as holding any share upon any trust and the Company shall not be bound by or compelled in any way to recognise (even when having notice thereof) any equitable, contingent, future or partial interest in any share or any interest in any fractional part of a share or (except only as by these Articles or by law otherwise provided) any other rights in respect of any share, except an absolute right to the entirety thereof in the person (other than the Depository) entered in the Register of Members as the registered holder thereof or (where the person entered in the Register of Members as the registered holder of a share is the Depository) the person whose name is entered in the Depository Register in respect of that share. Article 20 – Person under disability No share shall in any circumstances be transferred to any infant, bankrupt or person of unsound mind but nothing herein contained shall be construed as imposing on the company any liability in respect of the registration of such transfer if the company has no actual knowledge of the same. Article 48(1) – Issue of new shares to Members Subject to any direction to the contrary that may be given by the Company in general meeting, or except as permitted under the Exchange’s listing rules, all new shares shall before issue be offered to the Members in proportion, as nearly as the circumstances admit, to the number of the existing shares to which they are entitled or hold. The offer shall be made by notice specifying the number of shares offered, and limiting a time within which the offer, if not accepted, will be deemed to be declined, and, after the expiration of that time, or on the receipt of an intimation from the person to whom the offer is made that he declines to

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APPENDIX C – SUMMARY OF SELECTED ARTICLES OF ASSOCIATION OF OUR COMPANY
accept the shares offered, the Directors may dispose of those shares in such manner as they think most beneficial to the Company. The Directors may likewise so dispose of any new shares which (by reason of the ratio which the new shares bear to shares held by persons entitled to an offer of new shares) cannot, in the opinion of the Directors, be conveniently offered under this Article. Article 48(2) Notwithstanding Article 48(1) above but subject to the Companies Act and the byelaws and listing rules of the Exchange, the Company may by ordinary resolution in general meeting give to the Directors a general authority, either unconditionally or subject to such conditions as may be specified in the ordinary resolution to: (i) issue shares in the capital of the Company (whether by way of rights, bonus or otherwise); and/or make or grant Instruments; and/or

(ii)

(iii) (notwithstanding the authority conferred by the ordinary resolution may have ceased to be in force) issue shares in pursuance of any Instrument made or granted by the Directors while the ordinary resolution was in force; provided that: (a) the aggregate number of shares or Instruments to be issued pursuant to the ordinary resolution (including shares to be issued in pursuance of Instruments made or granted pursuant to the ordinary resolution but excluding shares which may be issued pursuant to any adjustments effected under any relevant Instrument) does not exceed any applicable limits prescribed by the Exchange; in exercising the authority conferred by the ordinary resolution, the Company shall comply with the listing rules for the time being in force (unless such compliance is waived by the Exchange) and the Articles; and (unless revoked or varied by the Company in general meeting) the authority conferred by the ordinary resolution shall not continue in force beyond the conclusion of the Annual General Meeting next following the passing of the ordinary resolution, or the date by which such Annual General Meeting is required by law to be held, or the expiration of such other period as may be prescribed by the Companies Act (whichever is the earliest).

(b)

(c)

Article 48(3) Notwithstanding Article 48(1) above but subject to the Companies Act, the Directors shall not be required to offer any new shares to members to whom by reason of foreign securities laws such offers may not be made without registration of the shares or a prospectus or other document, but may sell the entitlements to the new shares on behalf of such Members in such manner as they think most beneficial to the Company.

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APPENDIX D – TAXATION
The following is a discussion of certain tax matters relating to Singapore income tax, capital gains tax, stamp duty, estate duty and GST consequences in relation to the purchase, ownership and disposal of our Shares based on the current tax laws in Singapore. The discussion is limited to a general description of certain tax consequences in Singapore with respect to ownership of our Shares by Singapore investors, and does not purport to be a comprehensive nor exhaustive description of all of the tax considerations that may be relevant to a decision to purchase our Shares. It is also not intended to be and does not constitute legal or tax advice. The discussion below is based on the assumption that our Company is a tax resident in Singapore for Singapore income tax purposes. The laws, regulations and interpretations, may change at any time, and any change could be made on a retroactive basis. These laws and regulations are also subject to various interpretations and no assurance can be given that the relevant tax authorities or the courts of Singapore will agree with the explanations or conclusions set out below or that changes in such laws and regulations will not occur. You, as a prospective subscriber of our Shares should consult your tax advisers and/or legal advisers concerning the tax consequences of owning and disposing our Shares. Neither our Company, our Directors nor any other persons involved in this Placement accepts responsibility for any tax effects or liabilities resulting from the subscription, purchase, holding or disposal of our Shares. 1. INCOME TAX (a) Individual Taxpayers An individual is regarded as a tax resident in Singapore in a year of assessment if, in the preceding calendar year, he was physically present in Singapore or exercised an employment in Singapore for 183 days or more, or if he ordinarily resides in Singapore. Individual taxpayers who are Singapore tax residents are subject to Singapore income tax on income accrued in or derived from Singapore. All foreign-source income received (except for certain income received through a partnership in Singapore) in Singapore by Singapore tax resident individuals is exempt from Singapore income tax if the IRAS is satisfied that the tax exemption would be beneficial to the individual. Singapore tax-resident individuals are subject to tax based on progressive rates, currently ranging from 0% to 20%. Non-Singapore resident individuals, subject to certain exceptions, are subject to Singapore income tax on income accrued in or derived from Singapore. They are generally subject to tax at 20% except for Singapore employment income which is subjected to tax at a flat rate of 15% or at the resident rate, whichever is higher. (b) Corporate Taxpayers A company is tax resident in Singapore if the control and management of its business is exercised in Singapore. Corporate taxpayers are subject to Singapore income tax on income accrued in or derived from Singapore and, subject to certain exceptions, on foreign-source income received or deemed to be received in Singapore from outside Singapore. Foreign-

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APPENDIX D – TAXATION
source income in the form of dividends, branch profits and services income received or deemed to be received in Singapore by Singapore tax resident companies on or after 1 June 2003 are exempt from tax if certain prescribed conditions are met. The corporate tax rate in Singapore is 17% with effect from year of assessment 2010 (i.e. financial year ended 2009). In addition, 75% of up to the first S$10,000 of normal chargeable income, and 50% of up to the next S$290,000 is exempt from corporate tax. The remaining chargeable income (after the partial tax exemption) will be taxed at 17%. In addition, for newly incorporated entities, subject to meeting certain conditions, the first S$100,000 and one-half of up to the next S$200,000 of their normal chargeable income will be eligible for tax exemption. (c) Dividend Distributions (i) One Tier Corporate Taxation System Singapore adopts the One-Tier Corporate Taxation System (“ One-Tier System ”), Under the One-Tier System, the tax collected from corporate profits is a final tax and the after-tax profits of the company resident in Singapore can be distributed to the shareholders as tax exempt (One-Tier) dividends. Such dividends are tax exempt in the hands of the shareholders. (ii) Withholding Taxes Singapore does not currently impose withholding tax on dividends paid to resident or non-resident shareholders. Foreign shareholders are advised to consult their own tax advisers to take into account the tax laws of their respective home countries/countries of residence and the applicability of any double taxation agreement which their country of residence may have with Singapore. 2. CAPITAL GAINS TAX In general, there is no tax on capital gains in Singapore. Thus, any gains derived from the disposal of our Shares acquired for long-term investment will not be taxable in Singapore. On the other hand, where the taxpayer is deemed by the IRAS to be carrying on a trade or business of dealing in shares in Singapore, gains from disposal of shares are of an income nature (rather than capital gains) and thus subject to Singapore income tax. Subject to certain conditions being met, with effect from 1 June 2012 and for a period of five years, gains derived from the disposal of ordinary shares by companies will not be subjected to Singapore tax, if the divesting company holds a minimum shareholding of 20% of the ordinary shares in the company whose shares are being disposed for a minimum period of 24 months. Other than the above, there are no specific laws or regulations which deal with the characterisation of capital gains, and hence, gains may be construed to be of an income nature and subject to tax especially if they arise from activities which the IRAS regards as the carrying on of a trade in Singapore. D-2

APPENDIX D – TAXATION
Foreign sellers are advised to consult their own tax advisers to take into account the applicable tax laws of their respective home countries or countries of residence as well as the provisions of any applicable double taxation agreement. 3. STAMP DUTY No stamp duty is payable on the subscription and issuance of our Shares. Where existing Shares evidenced in certificated form are acquired in Singapore, stamp duty is payable on the instrument of transfer of the Shares at the rate of S$0.20 for every S$100 or any part thereof of the consideration for, or market value of the Shares, whichever is higher. The purchaser is liable for stamp duty, unless otherwise agreed. No stamp duty is payable if no instrument of transfer is executed (such as in the case of scripless shares, the transfer of which does not require instruments of transfer to be executed) or if the instrument of transfer is executed outside Singapore. However, stamp duty may be payable if the instrument of transfer which is executed outside Singapore is subsequently received in Singapore. Stamp duty is not applicable to electronic transfers of our Shares through the CDP system. 4. ESTATE DUTY Singapore estate duty has been abolished with effect from 15 February 2008. 5. GOODS AND SERVICES TAX (“GST”) General The sale of our Shares by a GST-registered investor belonging in Singapore to another person belonging in Singapore is an exempt supply not subject to GST. Any GST (for example, GST on brokerage) incurred by the investor in connection with the making of this exempt supply will generally become an additional cost to the investor unless the investor satisfies certain concessions. Where our Shares are sold by a GST-registered investor to a person belonging to a country other than Singapore, the sale is a zero-rated supply (i.e. subject to GST at zero rate). Any GST (for example, GST on brokerage) incurred by him in the making of this zero-rated supply for the purpose of his business will, subject to the provisions of the GST legislation, be recoverable as an input tax credit in his GST returns. Investors should seek their own tax advice on the recoverability of GST incurred on expenses in connection with purchase and sale of our Shares. Services such as brokerage, handling and clearing services rendered by a GST-registered person to an investor belonging in Singapore in connection with the investor’s purchase, sale or holding of our Shares will be subject to GST at the prevailing rate of 7.0%. Similar services rendered contractually to an investor belonging outside Singapore should qualify for zero-rating (i.e. subject to GST at zero rate) provided that the investor is not physically present in Singapore at the time the services are performed and the services do not directly benefit a person who belongs in Singapore.

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APPENDIX E – RULES OF THE PS GROUP HOLDINGS PERFORMANCE SHARE PLAN
1. NAME OF THE PSP The PSP shall be called the “PS Group Holdings Performance Share Plan”. 2. 2.1 DEFINITIONS In this PSP, unless the context otherwise requires, the following words and expressions shall have the following meanings: “Adoption Date” : The date on which the PSP is adopted by the Company in general meeting (a) in relation to any director, chief executive officer, substantial shareholder or controlling shareholder (being an individual) means: (i) (ii) his immediate family; the trustees of any trust of which he or his immediate family is a beneficiary or, in the case of a discretionary trust, is a discretionary object; or

“Associate”

:

(iii) any company in which he and his immediate family together (directly or indirectly) have an interest of 30.0% or more; (b) in relation to a substantial shareholder or a controlling shareholder (being a company) means any other company which is its subsidiary or holding company or is a subsidiary of such holding company or one in the equity of which it and/or such other company or companies taken together (directly or indirectly) have an interest of 30.0% or more

“Auditors” “Award” “Board”

: : :

The auditors for the time being of the Company An award of Shares granted under the PSP The board of Directors of the Company for the time being The Central Depository (Pte) Limited The date for the commencement of the PSP The remuneration committee of the Company, or such other committee comprising directors of the Company duly authorised and appointed by the Board to administer this PSP E-1

“CDP” “Commencement Date” “Committee”

: : :

APPENDIX E – RULES OF THE PS GROUP HOLDINGS PERFORMANCE SHARE PLAN
“Companies Act” : The Companies Act (Chapter 50) of Singapore, as amended, modified or supplemented from time to time PS Group Holdings Ltd. A Shareholder who, in relation to the Company, has control, as further defined in Rule 2.2 A director of the Company for the time being The PS Group Holdings Employee Share Option Scheme, as modified or supplemented from time to time The Company and its subsidiaries Any confirmed full time employee of the Group (including any Group Executive Director) selected by the Committee to participate in the PSP in accordance with the provisions thereof A director of the Company and/or any of its subsidiaries, as the case may be, who performs an executive function Section B of the Listing Manual of the SGX-ST, as amended, modified or supplemented from time to time A day on which the SGX-ST is open for trading in securities The new Shares which may be issued from time to time pursuant to the vesting of Awards granted under the PSP A director of the Company and/or any of its subsidiaries, as the case may be, other than a Group Executive Director The right to subscribe for Shares granted or to be granted pursuant to the ESOS A person who is selected by the Committee to participate in the PSP in accordance with the provisions of the PSP The performance targets prescribed by the Committee to be fulfilled by a Participant for any particular period under the PSP

“Company” “Controlling Shareholder”

: :

“Director” “ESOS”

: :

“Group” “Group Employee”

: :

“Group Executive Director”

:

“Listing Manual”

:

“Market Day”

:

“New Shares”

:

“Non-Executive Director”

:

“Option”

:

“Participant”

:

“Performance Targets”

:

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APPENDIX E – RULES OF THE PS GROUP HOLDINGS PERFORMANCE SHARE PLAN
“PS Group Holdings Performance Share Plan” or “PSP” “Rules” : The PS Group Holdings Performance Share Plan, as modified or supplemented from time to time

:

The rules of the PSP, as the same may be amended or supplemented from time to time Singapore Exchange Securities Trading Limited Registered holders of Shares except that where the registered holder is CDP, the term “Shareholders” shall, in relation to such Shares mean the Depositors whose securities accounts are credited with the Shares Ordinary shares in the capital of the Company Issued Shares of the Company which were (or are treated as having been) purchased by the Company in circumstances which Section 76H of the Companies Act applies and have since purchase been continuously held by the Company In relation to Shares which are the subject of an Award which has been released in accordance with Rule 10, the date (as determined by the Committee and notified to the relevant Participant) on which those Shares will vest pursuant to Rule 10 Singapore dollars and cents respectively Per centum

“SGX-ST” “Shareholders”

: :

“Shares” “treasury shares”

: :

“Vesting Date”

:

“$” and “cents” “%” 2.2 For the purposes of the PSP: (a)

: :

in relation to a Shareholder (including, where the context requires, the Company), “control” means the capacity to dominate decision-making, directly or indirectly, in relation to the financial and operating policies of the company; unless rebutted, a person who holds directly or indirectly, a shareholding of 15% or more of the Company’s total number of issued shares excluding treasury shares shall be presumed to be a Controlling Shareholder; and in relation to a Controlling Shareholder, his “associate” shall have the meaning ascribed to it by the Listing Manual or any other publication prescribing rules or regulations for corporations admitted to the Official List of Catalist (as modified, supplemented or amended from time to time).

(b)

(c)

2.3

The terms “Depositor” and “Depository Agent” shall have the meanings ascribed to them respectively by Section 130A of the Companies Act.

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APPENDIX E – RULES OF THE PS GROUP HOLDINGS PERFORMANCE SHARE PLAN
2.4 Any reference in the PSP or the Rules to any enactment is a reference to that enactment as for the time being amended or re-enacted. Any word defined under the Companies Act or any statutory modification thereof and used in the PSP and the Rules shall have the meaning assigned to it under the Companies Act. Words importing the singular number shall include the plural number where the context admits and vice versa . Words importing the masculine gender shall include the feminine gender where the context admits. Any reference to a time of day shall be a reference to Singapore time. OBJECTIVES The main objectives of the PSP are as follows: (a) to attract potential employees with relevant skills to contribute to the Group and to create value for Shareholders; to instil loyalty to, and a stronger identification by the Participants with the long-term prosperity of the Group; to motivate the Participants to optimise their performance standards and efficiency and to maintain a high level of contribution to the Group; to align the interests of the Participants with the interests of the Shareholders; to give recognition to the contributions made by the Participants to the success of the Group; and to retain key employees of the Company whose contributions are essential to the long-term prosperity of the Group.

2.5

2.6 3. 3.1

(b)

(c)

(d) (e)

(f)

4. 4.1

ELIGIBILITY The following persons (provided that such persons are not undischarged bankrupts at the relevant time) shall be eligible to participate in the PSP at the absolute discretion of the Committee: (a) Group Employees (including Group Executive Directors) who have attained the age of 21 years on or before the date of grant of the Award; and Non-Executive Directors (including independent Directors) who have attained the age of 21 years on or before the date of grant of the Award.

(b)

4.2

Controlling Shareholders and Associates of the Controlling Shareholders who meet the eligibility criteria in Rule 4.1 shall be eligible to participate in the PSP provided that (a) the participation of; and (b) the terms of each grant and the actual number of Awards granted under the PSP, to a Participant who is a Controlling Shareholder or an Associate of a Controlling Shareholder shall be approved by the independent Shareholders in a general meeting in separate resolutions for each such person, and the basis for seeking such Shareholders’ approval will be included in the circular to Shareholders.

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APPENDIX E – RULES OF THE PS GROUP HOLDINGS PERFORMANCE SHARE PLAN
4.3 Participants who are also Shareholders and are eligible to participate in this Plan must abstain from voting on any resolution relating to the participation of, or grant of Awards to the Participants. The Controlling Shareholder and his Associate shall abstain from voting on the resolution in relation to his participation in this Plan and grant of Awards to him. For the purposes of determining eligibility to participate in the PSP, the secondment of a Group Employee to another company within the Group shall not be regarded as a break in his employment or his having ceased by reason only of such secondment to be a full-time employee of the Group. There shall be no restriction on the eligibility of any Participant to participate in any other share incentive schemes or share plans implemented or to be implemented by the Company or any other company within the Group. Subject to the Companies Act and any requirement of the SGX-ST, the terms of eligibility for participation in the PSP may be amended from time to time at the absolute discretion of the Committee. LIMITATIONS UNDER THE PSP The total number of Shares which may be delivered pursuant to the vesting of Awards on any date, when added to the aggregate number of Shares issued and/or issuable in respect of (a) all Awards granted under the PSP; (b) all Options granted under the ESOS; and (c) all other Shares issued and/or issuable under any other share-based incentive schemes or share plans of the Company, shall not exceed 15% of the total number of issued Shares (excluding treasury shares) of the Company from time to time. Shares which are the subject of Awards which have lapsed for any reason whatsoever may be the subject of further Awards granted by the Committee under the PSP. The aggregate number of Shares available to the Controlling Shareholders or Associates of the Controlling Shareholders (including adjustments made in accordance with Rule 11) shall not exceed 25% of the Shares available under the PSP. The number of Shares available to each Controlling Shareholder or Associate of the Controlling Shareholder (including adjustments made in accordance with Rule 11) shall also not exceed 10% of the Shares available under the PSP. DATE OF GRANT The Committee may grant Awards at any time in the course of a financial year, provided that in the event that an announcement on any matter of an exceptional nature involving unpublished price sensitive information is imminent, Awards may only be vested and hence any Shares comprised in such Awards may only be delivered on or after the second Market Day from the date on which the aforesaid announcement is made.

4.4

4.5

4.6

4.7

5. 5.1

5.2

5.3

5.4

6.

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APPENDIX E – RULES OF THE PS GROUP HOLDINGS PERFORMANCE SHARE PLAN
7. 7.1 AWARDS The selection of the Participants and number of Shares which are the subject of each Award to be granted to a Participant in accordance with the PSP shall be determined at the absolute discretion of the Committee, which shall take into account criteria such as, inter alia , the rank, scope of responsibilities, performance, years of service and potential for future development and contribution to the success of the Group. In the case of a performance-related Award, the Performance Targets will be set by the Committee depending on each individual Participant’s job scope and responsibilities. The Performance Targets to be set shall take into account both the medium and long-term corporate objectives of the Group and the individual performance of the Participant and will be aimed at sustaining long-term growth. The corporate objectives shall cover market competitiveness, business growth and productivity growth. The Performance Targets could be based on criteria such as sales growth, growth in earnings and return on investment. In addition, the Participant’s length of service with the Group, achievement of past Performance Targets, value-add to the Group’s performance and development and overall enhancement to shareholder value, amongst others, will be taken into account. As soon as reasonably practicable after an Award is finalised by the Committee, the Committee shall send an Award letter to the Participant confirming the said Award. The said Award letter shall specify, inter alia , the following: (a) in relation to a performance-related Award, the Performance Targets for the Participant and the period during which the Performance Targets shall be met; the number of Shares to be vested on the Participant; and the date by which the Award shall be vested.

7.2

7.3

(b) (c) 7.4

The Committee shall take into account various factors when determining the method to arrive at the exact number of Shares comprised in an Award. Such factors include, but are not limited to, the current price of the Shares, the total issued share capital of the Company and the predetermined dollar amount which the Committee decides that a Participant deserves for meeting his Performance Targets. For example, Shares may be awarded based on predetermined dollar amounts such that the quantum of Shares comprised in Awards is dependent on the closing price of Shares transacted on the Market Day the Award is vested. Alternatively, the Committee may decide absolute numbers of Shares to be awarded to Participants irrespective of the price of the Shares. The Committee shall monitor the grant of Awards carefully to ensure that the size of the PSP will comply with the relevant rules of the Listing Manual. Awards are personal to the Participant to whom it is given and shall not be transferred (other than to a Participant’s personal representative on the death of that Participant), charged, assigned, pledged or otherwise disposed of, in whole or in part, unless with the prior approval of the Committee.

7.5

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APPENDIX E – RULES OF THE PS GROUP HOLDINGS PERFORMANCE SHARE PLAN
8. 8.1 VESTING OF THE AWARDS Notwithstanding that a Participant may have met his Performance Targets, no Awards shall be vested: (a) upon the bankruptcy of the Participant or the happening of any other event which results in his being deprived of the legal or beneficial ownership of such Award; in the event of any misconduct on the part of the Participant as determined by the Committee in its discretion; subject to Rule 8.2, upon the Participant ceasing to be in the employment of the Group for any reason whatsoever; or in the event that the Committee shall, at its discretion, deem it appropriate that such Award to be given to a Participant shall so lapse on the grounds that any of the objectives of the PSP (as set out in Rule 3) have not been met.

(b)

(c)

(d)

8.2

A Participant shall be entitled to an Award so long as he has met the Performance Targets notwithstanding that he may have ceased to be employed by the Group after the fulfilment of such Performance Targets. For the purpose of this Rule 8.2, the Participant may cease to be so employed in any of the following events, namely: (a) through ill health, injury or disability (in each case, evidenced to the satisfaction of the Committee); redundancy; death; retirement at or after the legal retirement age; retirement before the legal retirement age with the consent of the Committee; or any other event approved by the Committee.

(b) (c) (d) (e) (f) 9. 9.1

TAKE-OVER AND WINDING UP OF THE COMPANY Notwithstanding Rule 8 but subject to Rule 9.5, in the event of a take-over being made for the Shares, a Participant shall (notwithstanding that the vesting period for the Award has not expired) be entitled to the Shares under the Awards if he has met the Performance Targets which fall within the period commencing on the date on which such offer for a take-over of the Company is made or, if such offer is conditional, the date on which such offer becomes or is declared unconditional, as the case may be, and ending on the earlier of: (a) the expiry of six months thereafter, unless prior to the expiry of such 6-month period, at the recommendation of the offeror and with the approvals of the Committee and

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APPENDIX E – RULES OF THE PS GROUP HOLDINGS PERFORMANCE SHARE PLAN
the SGX-ST, such expiry date is extended to a later date (in either case, being a date falling not later than the last date on which the Performance Targets are to be met); or (b) the date of expiry of the period for which the Performance Targets are to be met,

provided that if during such period, the offeror becomes entitled or bound to exercise rights of compulsory acquisition under the provisions of the Companies Act and, being entitled to do so, gives notice to the Participants that it intends to exercise such rights on a specified date, the Participant shall be obliged to fulfill such Performance Targets until the expiry of such specified date or the expiry date of the Performance Targets relating thereto, whichever is earlier, before an Award can be vested. 9.2 If under any applicable laws, the court sanctions a compromise or arrangement proposed for the purposes of, or in connection with, a scheme for the reconstruction of the Company or its amalgamation with another company or companies, each Participant who has fulfilled his Performance Targets shall be entitled, notwithstanding the provisions herein and the fact that the vesting period for such Award has not expired but subject to Rule 9.5, to any Shares under the Awards so determined by the Committee to be released to him during the period commencing on the date upon which the compromise or arrangement is sanctioned by the court and ending either on the expiry of 60 days thereafter or the date upon which the compromise or arrangement becomes effective, whichever is later. If an order or an effective resolution is made for the winding-up of the Company on the basis of its insolvency, all Awards, notwithstanding that they may have been so vested shall be deemed or become null and void. In the event of a members’ voluntary winding-up (other than for amalgamation or reconstruction), the Awards shall so vest in the Participant for so long as, in the absolute determination by the Committee, the Participant has met the Performance Targets prior to the date that the members’ voluntary winding-up shall be deemed to have been commenced or effective in law. If in connection with the making of a general offer referred to in Rule 9.1 or the scheme referred to in Rule 9.2 or the winding-up referred to in Rule 9.4, arrangements are made (which are confirmed in writing by the Auditors, acting only as experts and not as arbitrators, to be fair and reasonable) for the compensation of Participants, whether by the payment of cash or by any other form of benefit, no release of Shares under the Award shall be made in such circumstances. RELEASE OF AWARDS As soon as reasonably practicable after the end of each performance period, the Committee shall review the Performance Targets specified in respect of that Award and determine whether they have been satisfied and, if so, the extent to which they have been satisfied (whether fully or partially) and the number of Shares to be released. The Committee shall have the discretion to determine whether Performance Targets have been met (whether fully or partially) or exceeded and/or whether the Participant’s performance and/or contribution to the Company and/or any of its subsidiaries justifies the

9.3

9.4

9.5

10. 10.1

10.2

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APPENDIX E – RULES OF THE PS GROUP HOLDINGS PERFORMANCE SHARE PLAN
vesting of an Award. In making any such determination, the Committee shall have the right to make reference to the audited results of the Company or the Group, as the case may be, to take into account such factors as the Committee may determine to be relevant, such as changes in accounting methods, taxes and extraordinary events, and further, the right to amend the Performance Targets if the Committee decides that a changed Performance Targets would be a fairer measure of performance. 10.3 Awards may only be vested and consequently any Shares comprised in such Awards shall only be delivered upon the Committee being satisfied that the Participant has achieved the Performance Targets. Subject to the prevailing legislation and the provisions of the Listing Manual, the Company will deliver Shares to Participants upon vesting of their Awards by way of an issue of New Shares or the transfer of existing Shares held as treasury shares to the Participants. In determining whether to issue New Shares or to purchase existing Shares for delivery to Participants upon the vesting of their Awards, the Company will take into account factors such as the number of Shares to be delivered, the prevailing market price of the Shares and the financial effect on the Company of either issuing New Shares or purchasing existing Shares. The Committee will procure, upon approval of the Board, the allotment or transfer to each Participant of the number of Shares which are to be released to that Participant pursuant to an Award under Rule 7. Any proposed issue of New Shares will be subject to there being in force at the relevant time the requisite Shareholders approval under the Companies for the issue of Shares. Any allotment of New Shares pursuant to an Award will take into account the rounding of odd lots. Where New Shares are to be allotted or any Shares are to be transferred to a Participant pursuant to the release of any Award, the Vesting Date will be a trading day falling as soon as practicable after the review of the Committee referred to in Rule 10.1. On the Vesting Date, the Committee will procure the allotment or transfer of each Participant of the number of Shares so determined. Where New Shares are to be allotted upon the vesting of any Award, the Company shall, as soon as practicable after allotment, where necessary, apply to the SGX-ST for the permission to deal in and for quotation of such Shares on Catalist. Shares which are allotted or transferred on the release of an Award to a Participant shall be issued in the name of, or transferred to, CDP to the credit of either: (a) (b) (c) the securities account of that Participant maintained with CDP; the securities sub-account of that Participant maintained with a Depository Agent; or the CPF investment account maintained with a CPF agent bank,

10.4

10.5

10.6

10.7

10.8

10.9

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APPENDIX E – RULES OF THE PS GROUP HOLDINGS PERFORMANCE SHARE PLAN
in each case, as designated by that Participant. Until such issue or transfer of such Shares has been effected, that Participant shall have no voting rights nor any entitlements to dividends or other distributions declared or recommended in respect of any Shares which are the subject of the Award granted to him. 10.10 New Shares allotted and issued, and existing Shares held in treasury procured by the Company for transfer, on the release of an Award, shall be subject to all the provisions of the Memorandum and Articles of Association of the Company and the Companies Act, and shall rank in full for all entitlements, including dividends or other distributions declared or recommended in respect of the then existing Shares, the Record Date for which is on or after the date of issue of the New Shares or the date of transfer of treasury shares pursuant to the vesting of the Award, and shall in all other respects rank pari passu with other existing Shares then in issue. “Record Date” means the date fixed by the Company for the purposes of determining entitlements to dividends or other distributions to or rights of holders of Shares. 10.11 Shares which are allotted, and/or treasury shares which are transferred, on the vesting of an Award to a Participant, may be subject to such moratorium as may be imposed by the Committee. VARIATION OF CAPITAL If a variation in the issued ordinary share capital of the Company (whether by way of a capitalisation of profits or reserves or rights issue, capital reduction, subdivision, consolidation, distribution or otherwise) shall take place, then: (a) the class and/or number of Shares which are the subject of an Award to the extent not yet vested; and/or the class and/or number of Shares over which future Awards may be granted under the PSP,

11. 11.1

(b)

shall be adjusted by the Committee to give each Participant the same proportion of the equity capital of the Company as that to which he was previously entitled and, in doing so, the Committee shall determine at its own discretion the manner in which such adjustment shall be made. 11.2 Unless the Committee considers an adjustment to be appropriate, the following events shall not normally be regarded as a circumstance requiring adjustment: (a) the issue of securities as consideration for an acquisition or a private placement of securities; the cancellation of issued Shares purchased or acquired by the Company by way of a market purchase of such Shares undertaken by the Company on Catalist of the SGX-ST during the period when a share purchase mandate granted by Shareholders (including any renewal of such mandate) is in force;

(b)

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APPENDIX E – RULES OF THE PS GROUP HOLDINGS PERFORMANCE SHARE PLAN
(c) the issue of Shares or other securities convertible into or with rights to acquire or subscribe for Shares to its employees pursuant to any share option scheme or share plan approved by Shareholders in general meeting, including the PSP; and any issue of Shares arising from the exercise of any warrants or the conversion of any convertible securities issued by the Company.

(d)

11.3

Notwithstanding the provisions of Rule 11.1: (a) the adjustment must be made in such a way that a Participant will not receive a benefit that a Shareholder does not receive; and any adjustment (except in relation to a capitalisation issue) must be confirmed in writing by the Auditors (acting only as experts and not as arbitrators) to be in their opinion, fair and reasonable.

(b)

11.4

Upon any adjustment required to be made pursuant to this Rule 11, the Company shall notify the Participant (or his duly appointed personal representatives where applicable) in writing and deliver to him (or his duly appointed personal representatives where applicable) a statement setting forth the class and/or number of Shares thereafter to be issued or transferred on the vesting of an Award. Any adjustment shall take effect upon such written notification being given. ADMINISTRATION OF THE PSP The Plan shall be administered by the Committee in its absolute discretion with such powers and duties as are conferred on it by the Board, provided that no member of the Committee shall participate in any deliberation or decision in respect of Awards granted or to be granted to him. The Committee shall have the power, from time to time, to make and vary such rules (not being inconsistent with the PSP) for the implementation and administration of the PSP as they think fit including, but not limited to: (a) imposing restrictions on the number of Awards that may be vested within each financial year; and amending Performance Targets if by so doing, it would be a fairer measure of performance for a Participant or for the PSP as a whole.

12. 12.1

12.2

(b)

12.3

Any decision of the Committee made pursuant to any provision of the PSP (other than a matter to be certified by the Auditors) shall be final and binding (including any decisions pertaining to the number of Shares to be vested) or to disputes as to the interpretation of the PSP or any rule, regulation, procedure thereunder or as to any rights under the PSP. NOTICES AND ANNUAL REPORT Any notice required to be given by a Participant to the Company shall be sent or made to the registered office of the Company or such other addresses as may be notified by the Company to him in writing.

13. 13.1

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APPENDIX E – RULES OF THE PS GROUP HOLDINGS PERFORMANCE SHARE PLAN
13.2 Any notices or documents required to be given to a Participant or any correspondence to be made between the Company and the Participant shall be given or made by the Committee (or such person(s) as it may from time to time direct) on behalf of the Company and shall be delivered to him by hand or sent to him at his home address according to the records of the Company or at the last known address of the Participant and if sent by post, shall be deemed to have been given on the day following the date of posting. The following disclosures (as applicable) will be made by the Company in its annual report for so long as the PSP continues in operation: (a) (b) the names of the members of the Committee administering the PSP; in respect of the following Participants: (i) (ii) Directors of the Company; Participants who are Controlling Shareholders and their Associates; and

13.3

(iii) Participants (other than those in paragraph (b)(i) above) who have received Shares pursuant to the vesting of the Awards granted under the PSP which, in aggregate, represent 5% or more of the total number of Shares available under the PSP, the following information: (aa) the name of the Participant; (bb) the aggregate number of Shares comprised in Awards which have been granted to such Participant during the financial year under review; (cc) the aggregate number of Shares comprised in Awards which have been granted to such Participant since the commencement of the PSP to the end of the financial year under review; (dd) the aggregate number of Shares comprised in Awards which have been issued and/or transferred to such Participant pursuant to the vesting of Awards under the PSP since the commencement of the PSP to the end of the financial year under review; and (ee) the aggregate number of Shares comprised in Awards which have not been vested as at the end of the financial year under review; and (c) such other information as may be required by the Listing Manual or the Companies Act.

If any of the above is not applicable, an appropriate negative statement shall be included.

E-12

APPENDIX E – RULES OF THE PS GROUP HOLDINGS PERFORMANCE SHARE PLAN
14. 14.1 MODIFICATIONS TO THE PSP Any or all the provisions of the PSP may be modified and/or altered at any time and from time to time by resolution of the Committee, provided that: (a) any modification or alteration which would be to the advantage of Participants under the PSP shall be subject to the prior approval of Shareholders in a general meeting; and no modification or alteration shall be made without due compliance with the Listing Manual and such other laws or regulations as may be applicable.

(b)

14.2

Written notice of any modification or alteration made in accordance with this Rule 14 shall be given to all Participants. TERMS OF EMPLOYMENT UNAFFECTED The terms of employment of a Participant (who is a Group Employee) shall not be affected by his participation in the PSP, which shall neither form part of such terms nor entitle him to take into account such participation in calculating any compensation or damages on the termination of his employment for any reason.

15.

16. 16.1

DURATION OF THE PSP The PSP shall continue to be in force at the discretion of the Committee, subject to a maximum period of 10 years commencing on the Adoption Date, Provided always that the PSP may continue beyond the above stipulated period with the approval of the Company’s shareholders by ordinary resolution in general meeting and of any relevant authorities which may then be required. The PSP may be terminated at any time at the discretion of the Committee or by an ordinary resolution of the Company in general meeting subject to all other relevant approvals which may be required and if the PSP is so terminated, no further Awards shall be offered by the Company thereunder. Notwithstanding the expiry or termination of the PSP, any Awards made to Participants prior to such expiry or termination will continue to remain valid. TAXES All taxes (including income tax) arising from the grant and/or disposal of Shares pursuant to the Awards granted to any Participant under the PSP shall be borne by that Participant.

16.2

16.3

17.

18. 18.1

COSTS AND EXPENSES Each Participant shall be responsible for all fees of CDP relating to or in connection with the issue and allotment or transfer of any Shares pursuant to the Awards in CDP’s name, the deposit of share certificate(s) with CDP, the Participant’s securities account with CDP, or the Participant’s securities sub-account with a CDP Depository Agent.

E-13

APPENDIX E – RULES OF THE PS GROUP HOLDINGS PERFORMANCE SHARE PLAN
18.2 Save for the taxes referred to in Rule 17 and such other costs and expenses expressly provided in the PSP to be payable by the Participants, all fees, costs and expenses incurred by the Company in relation to the PSP including but not limited to the fees, costs and expenses relating to the allotment, issue and/or delivery of Shares pursuant to the Awards shall be borne by the Company. DISCLAIMER OF LIABILITY Notwithstanding any provisions herein contained, the Board, the Committee and the Company shall not under any circumstances be held liable for any costs, losses, expenses and damages whatsoever and howsoever arising in any event, including but not limited to the Company’s delay in issuing or transferring the Shares or applying for or procuring the listing of the Shares on Catalist. 20. DISPUTES Any disputes or differences of any nature arising hereunder shall be referred to the Committee and its decision shall be final and binding in all respects. 21. CONDITION OF AWARDS Every Award shall be subject to the condition that no Shares would be issued or transferred pursuant to the vesting of any Award if such issue or transfer would be contrary to the constitutive documents of the Company or any law or enactment, or any rules or regulations of any legislative or non-legislative governing body for the time being in force in Singapore or any other relevant country having jurisdiction in relation to the issue or transfer of Shares hereto. 22. GOVERNING LAW The PSP shall be governed by, and construed in accordance with, the laws of the Republic of Singapore. The Participants, by accepting Awards in accordance with the PSP, and the Company irrevocably submit to the exclusive jurisdiction of the courts of the Republic of Singapore.

19.

E-14

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
1. NAME OF THE ESOS The ESOS shall be called the “PS Group Holdings Employee Share Option Scheme”. 2. 2.1 DEFINITIONS In the ESOS, unless the context otherwise requires, the following words and expressions shall have the following meanings: “Act” The Companies Act (Chapter 50) of Singapore, as amended, modified or supplemented from time to time Has the meaning assigned to it by the Listing Manual, as amended, modified or supplemented from time to time The auditors of the Company for the time being An award of Shares granted under the PSP The board of directors of the Company The Central Depository (Pte) Limited Central Provident Fund The remuneration committee of the Company, or such other committee comprising directors of the Company duly authorised and appointed by the Board to administer this ESOS PS Group Holdings Ltd. The capacity to dominate decision making, directly or indirectly, in relation to the financial and operating policies of the Company A shareholder exercising control over the Company and unless rebutted, a person who controls directly or indirectly 15% or more of the Company’s issued share capital shall be presumed to be a Controlling Shareholder of the Company In relation to an Option, the date on which the Option is granted to a Participant pursuant to Rule 7

“Associate”

“Auditors” “Awards” “Board” “CDP” “CPF” “Committee”

“Company” “control”

“Controlling Shareholder”

“Date of Grant”

F-1

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
“Director” A person holding office as a director for the time being of the Company and/or its Subsidiaries, as the case may be The PS Group Holdings Employee Share Option Scheme, as the same may be modified or altered from time to time A director of the Company and/or its Subsidiaries, as the case may be, who performs an executive function within the Company or the relevant Subsidiary, as the case may be The price at which a Participant shall subscribe for each Share upon the exercise of an Option which shall be the price as determined in accordance with Rule 9, as adjusted in accordance with Rule 10 A person to whom an offer of an Option is made The Company and its Subsidiaries Any confirmed full time employee of the Group (including any Executive Director) selected by the Committee to participate in the ESOS in accordance with Rule 4 Section B of the Listing Manual of the SGX-ST, as amended, modified or supplemented from time to time A day on which the SGX-ST is open for trading in securities A price equal to the average of the last dealt prices for the Shares on Catalist over the five consecutive Trading Days immediately preceding the Date of Grant of that Option, as determined by the Committee by reference to the daily official list or any other publication published by the SGX-ST, rounded to the nearest whole cent in the event of fractional prices A director of the Company and/or its Subsidiaries, as the case may be, other than an Executive Director but including the independent Directors of the Company The date on which an offer to grant an Option is made pursuant to the ESOS

“ESOS”

“Executive Director”

“Exercise Price”

“Grantee” “Group” “Group Employee”

“Listing Manual”

“Market Day”

“Market Price”

“Non-Executive Director”

“Offer Date”

F-2

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
“Option” The right to subscribe for Shares granted or to be granted to a Group Employee pursuant to the ESOS and for the time being subsisting The holder of an Option The PS Group Holdings Performance Share Plan, as the same may be modified or altered from time to time The date as at the close of business on which the Shareholders must be registered in order to participate in any dividends, rights, allotments or other distributions Rules of the PS Group Holdings Employee Share Option Scheme The securities account maintained by a Depositor with CDP Singapore Exchange Securities Trading Limited Registered holders of Shares, except where the registered holder is CDP, the term “Shareholders” shall, in relation to such Shares, mean the Depositors whose securities accounts are credited with Shares Ordinary shares in the capital of the Company The sponsor appointed by the Company in accordance with the Listing Manual, for such time as the Company remains listed on the Catalist Board of the SGX-ST Companies which are for the time being subsidiaries of the Company as defined by Section 5 of the Act; and “Subsidiary” means each of them A day on which the Shares are traded on the Official List of Catalist Per centum Singapore dollars and cents respectively

“Participant” “PSP”

“Record Date”

“Rules”

“securities account”

“SGX-ST” “Shareholders”

“Shares” “Sponsor”

“Subsidiaries”

“Trading Day”

“per cent.” “S$” or “$” and “cents”

F-3

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
2.2 The term “Depositor”, “Depository Register” and “Depository Agent” shall have the meanings ascribed to it by Section 130A of the Act and the term “associate” shall have the meaning ascribed to it by the Listing Manual or any other publication prescribing rules or regulations for corporations admitted to the Official List of Catalist (as modified, supplemented or amended from time to time). Words importing the singular number shall, where applicable, include the plural number and vice versa . Words importing the masculine gender shall, where applicable, include the feminine and neuter gender. Any reference to a time of a day in the ESOS is a reference to Singapore time. Any reference in the ESOS to any enactment is a reference to that enactment as for the time being amended or re-enacted. Unless otherwise defined, any word defined under the Act or any statutory modification thereof and used in the ESOS shall have the meaning assigned to it under the Act. OBJECTIVES OF THE ESOS The ESOS will provide an opportunity for Group Employees who have contributed significantly to the growth and performance of the Group (including Executive Directors) and Non-Executive Directors (including independent Directors) and who satisfy the eligibility criteria as set out in Rule 4 of the ESOS, to participate in the equity of the Company. The ESOS is primarily a share incentive scheme. It recognises the fact that the services of such Group Employees are important to the success and continued well-being of the Group. Implementation of the ESOS will enable the Company to give recognition to the contributions made by such Group Employees. At the same time, it will give such Group Employees an opportunity to have a direct interest in the Company and will also help to achieve the following positive objectives: (a) to motivate each Participant to optimise his performance standards and efficiency and to maintain a high level of contribution to the Group; to retain key employees and Directors whose contributions are essential to the long-term growth and profitability of the Group; to instil loyalty to, and a stronger identification by the Participants with the long-term prosperity of, the Group; to attract potential employees with relevant skills to contribute to the Group and to create value for the Shareholders; and to align the interests of the Participants with the interests of the Shareholders.

2.3

2.4 2.5

3. 3.1

3.2

(b)

(c)

(d)

(e)

F-4

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
4. 4.1 ELIGIBILITY Confirmed Group Employees (including Executive Director) and Non-Executive Directors (including Independent Directors) who have attained the age of 21 years on or prior to the relevant Offer Date and are not undischarged bankrupts and have not entered into a composition with their respective creditors, shall be eligible to participate in the ESOS at the absolute discretion of the Committee. Controlling Shareholders and their Associates who meet the eligibility criteria in Rule 4.1 shall be eligible to participate in the ESOS, provided that (a) the participation of; and (b) the terms of any Options to be granted and the actual number of Options to be granted under the ESOS, to a Participant who is a Controlling Shareholder or an Associate of a Controlling Shareholder shall be approved by the independent Shareholders in separate resolutions for each such person. The Company will at such time provide the rationale and justification for any proposal to grant the Controlling Shareholder or his Associate any Options (including the rationale for any discount to the market price, if so proposed). Such Controlling Shareholder and his Associate shall abstain from voting on the resolution in relation to his participation in this ESOS and the grant of Options to him. 4.3 For the purposes of determining eligibility to participate in the ESOS, the secondment of a confirmed Group Employee to another company within the Group shall not be regarded as a break in his employment or his having ceased by reason only of such secondment to be a full-time employee of the Group. There will be no restriction on the eligibility of any Participant to participate in any other share option or share incentive schemes implemented by any other companies within the Group. Subject to the Act and any requirement of the SGX-ST, the terms of eligibility for participation in the ESOS may be amended from time to time at the absolute discretion of the Committee, which would be exercised judiciously. MAXIMUM ENTITLEMENT Subject to Rule 4, Rule 5.2, Rule 5.3 and Rule 10, the aggregate number of Shares in respect of which Options may be offered to a Grantee for subscription in accordance with the ESOS shall be determined by the discretion of the Committee, who shall take into account criteria such as rank, past performance, years of service and potential development of the Participant. The aggregate number of Shares issued and issuable in respect of all Options granted under the ESOS available to the Controlling Shareholders or Associates of the Controlling Shareholders shall not exceed 25% of the total number of Shares available under the ESOS. The number of Shares issued and issuable in respect of all Options granted under the ESOS available to each Controlling Shareholder or Associate of a Controlling Shareholder under the ESOS shall not exceed 10% of the total number of Shares available under the ESOS.

4.2

4.4

4.5

5. 5.1

5.2

5.3

F-5

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
6. LIMITATION ON SIZE OF THE ESOS The total number of Shares over which the Committee may grant Options on any date, when added to the number of Shares issued and issuable in respect of (a) all Options granted under the ESOS; (b) all Awards granted under the PSP; and (c) all outstanding options or awards granted under such other share-based incentive schemes of the Company, shall not exceed 15% of the number of issued Shares (including treasury shares, as defined in the Companies Act) on the day immediately preceding the Offer Date of the Option. 7. OFFER DATE The Committee may, save as provided in Rule 4, Rule 5 and Rule 6, offer to grant Options to such Grantees as it may select in its absolute discretion at any time during the period when the ESOS is in force, except that no Option shall be granted during the period of 30 days immediately preceding the date of announcement of the Company’s interim and/or final results (as the case may be). In addition, in the event that an announcement on any matter of an exceptional nature involving unpublished price sensitive information is made, offers to grant Options may only be made on or after the second Market Day on which such announcement is released. An offer to grant the Option to a Grantee shall be made by way of a letter (the “ Letter of Offer ”) in the form or substantially in the form set out in Schedule A, subject to such amendments as the Committee may determine from time to time. 8. 8.1 ACCEPTANCE OF OFFER An Option offered to a Grantee pursuant to Rule 7 may only be accepted by the Grantee within 30 days after the relevant Offer Date and not later than 5.00 p.m. on the 30th day from such Offer Date (a) by completing, signing and returning to the Company the acceptance form (“ Acceptance Form ”) in or substantially in the form set out in Schedule B, subject to such modification as the Committee may from time to time determine, accompanied by payment of S$1.00 as consideration; and (b) if, at the date on which the Company receives from the Grantee the Acceptance Form in respect of the Option as aforesaid, he remains eligible to participate in the ESOS in accordance with these Rules. The Grantee may accept or refuse the whole or part of the offer. If only part of the offer is accepted, the Grantee shall accept the offer in multiples of 1,000 Shares. If a grant of an Option is not accepted strictly in the manner as provided in this Rule 8.1, such offer shall, upon the expiry of the 30 day period, automatically lapse and shall forthwith be deemed to be null and void and be of no effect. 8.2 The Company shall be entitled to reject any purported acceptance of a grant of an Option made pursuant to this Rule 8 or exercise notice (“ Exercise Notice ”) in or substantially in the form set out in Schedule C given pursuant to Rule 12 which does not strictly comply with the terms of the ESOS. Options are personal to the Grantees to whom they are granted and shall not be sold, mortgaged, transferred, charged, assigned, pledged or otherwise disposed of or F-6

8.3

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
encumbered in whole or in part or in any way whatsoever without the Committee’s prior written approval, but may be exercised by the Grantee’s duly appointed personal representative as provided in Rule 11.6 in the event of the death of such Grantee. 8.4 In the event that a grant of an Option results in a contravention of any applicable law or regulation, such grant shall be null and void and be of no effect and the relevant Participant shall have no claim whatsoever against the Company. Unless the Committee determines otherwise, an Option shall automatically lapse and become null, void and of no effect and shall not be capable of acceptance if: (a) (b) (c) it is not accepted in the manner as provided in Rule 8.1 within the 30 day period; the Grantee dies prior to his acceptance of the Option; the Grantee is adjudicated a bankrupt or enters into composition with his creditors prior to his acceptance of the Option; the Grantee being a Group Employee ceases to be in the employment of the Group or (being a Director) ceases to be a Director of the Company, in each case, for any reason whatsoever prior to his acceptance of the Option; or the Company is liquidated or wound-up prior to the Grantee’s acceptance of the Option.

8.5

(d)

(e)

9. 9.1

EXERCISE PRICE Subject to any adjustment pursuant to Rule 10, the Exercise Price for each Share in respect of which an Option is exercisable shall be determined by the Committee, in its absolute discretion, on the Date of Grant, at: (a) (b) a price equal to the Market Price; or a price which is set at a discount to the Market Price, provided that: (i) the maximum discount shall not exceed 20% of the Market Price (or such other percentage or amount as may be determined by the Committee and permitted by the SGX-ST); and the Shareholders in general meeting shall have authorised, in a separate resolution, the making of offers and grants of Options under the ESOS at a discount not exceeding the maximum discount as aforesaid.

(ii)

9.2

In making any determination under Rule 9.1(b) on whether to give a discount and the quantum of such discount, the Committee shall be at liberty to take into consideration such criteria as the Committee may, at its absolute discretion, deem appropriate, including but not limited to: (a) the performance of the Company and/or its Subsidiaries, as the case may be;

F-7

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
(b) the years of service and individual performance of the eligible Group Employee or Director; the contribution of the eligible Group Employee or Director to the success and development of the Company and/or the Group; and the prevailing market conditions.

(c)

(d) 9.3

In the event that the Company is no longer listed on Catalist or any other relevant stock exchange or trading in the Shares on Catalist or such stock exchange is suspended for any reason for 14 days or more, the Exercise Price for each Share in respect of which an Option is exercisable shall be the fair market value of each such Share as determined by the Committee in good faith. ALTERATION OF CAPITAL If a variation in the issued share capital of the Company (whether by way of a capitalisation of profits or reserves or rights issue or reduction (including any reduction arising by reason of the Company purchasing or acquiring its issued Shares), subdivision, consolidation or distribution, or otherwise howsoever) should take place, then: (a) the Exercise Price for the Shares, class and/or number of Shares comprised in the Options to the extent unexercised and the rights attached thereto; and/or the class and/or number of Shares in respect of which additional Options may be granted to Participants,

10. 10.1

(b)

may be adjusted in such manner as the Committee may determine to be appropriate including retrospective adjustments where such variation occurs after the date of exercise of an Option but the Record Date relating to such variation precedes such date of exercise and, except in relation to a capitalisation issue, upon the written confirmation of the Auditors (acting only as experts and not as arbitrators), that in their opinion, such adjustment is fair and reasonable. 10.2 Notwithstanding the provisions of Rule 10.1 above, no such adjustment shall be made: (a) if as a result, the Participant receives a benefit that a Shareholder does not receive; and unless the Committee, after considering all relevant circumstances, considers it equitable to do so.

(b)

10.3

The issue of securities as consideration for an acquisition of any assets by the Company, or the cancellation of issued Shares purchased or acquired by the Company by way of market purchase of such Shares undertaken by the Company on Catalist during the period when a share purchase mandate granted by Shareholders (including any renewal of such mandate) is in force, shall not be regarded as a circumstance requiring adjustment under the provisions of this Rule 10, unless the Committee considers an adjustment to be appropriate, having due regard to the interests of Shareholders and Participants.

F-8

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
10.4 The restriction on the number of Shares to be offered to any Grantee under Rule 5 above, shall not apply to the number of additional Shares or Options over additional Shares issued by virtue of any adjustment to the number of Shares and/or Options pursuant to this Rule 10. Upon any adjustment required to be made pursuant to this Rule 10, the Company shall notify each Participant (or his duly appointed personal representative(s)) in writing and deliver to him (or, where applicable, his duly appointed personal representative(s)) a statement setting forth the new Exercise Price thereafter in effect and the class and/or number of Shares thereafter comprised in the Option so far as unexercised. Any adjustment shall take effect upon such written notification being given. OPTION PERIOD Options granted with the Exercise Price set at Market Price shall only be exercisable, in whole or in part (provided that an Option may be exercised in part only in respect of 1,000 Shares or any multiple thereof), at any time, by a Participant after the first anniversary of the Offer Date of that Option, Provided always that the Options shall be exercised before the tenth anniversary of the relevant Offer Date, or such earlier date as may be determined by the Committee, failing which all unexercised Options shall immediately lapse and become null and void and a Participant shall have no claim against the Company. Options granted with the Exercise Price set at a discount to Market Price shall only be exercisable, in whole or in part (provided that an Option may be exercised in part only in respect of 1,000 Shares or any multiple thereof), at any time, by a Participant after the second anniversary from the Offer Date of that Option, Provided always that the Options shall be exercised before the tenth anniversary of the relevant Offer Date, or such earlier date as may be determined by the Committee, failing which all unexercised Options shall immediately lapse and become null and void and a Participant shall have no claim against the Company. An Option shall, to the extent unexercised, immediately lapse and become null and void and a Participant shall have no claim against the Company: (a) subject to Rules 11.4, 11.5 and 11.6, upon the Participant ceasing to be in the employment of the Company or any of the companies within the Group for any reason whatsoever; upon the bankruptcy of the Participant or the happening of any other event which result in his being deprived of the legal or beneficial ownership of such Option; or in the event of misconduct on the part of the Participant, as determined by the Committee in its absolute discretion.

10.5

11. 11.1

11.2

11.3

(b)

(c)

For the purpose of Rule 11.3(a), a Participant shall be deemed to have ceased to be so employed as of the date the notice of termination of employment is tendered by or is given to him, unless such notice shall be withdrawn prior to its effective date.

F-9

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
11.4 If a Participant ceases to be employed by the Group by reason of his: (a) ill health, injury or disability, in each case, as certified by a medical practitioner approved by the Committee; redundancy; retirement at or after a normal retirement age; or retirement before that age with the consent of the Committee,

(b) (c) (d)

or for any other reason approved in writing by the Committee, he may, at the absolute discretion of the Committee exercise any unexercised Option within the relevant Option Period and upon the expiry of such period, the Option shall immediately lapse and become null and void. 11.5 If a Participant ceases to be employed by a Subsidiary: (a) by reason of the Subsidiary, by which he is principally employed ceasing to be a company within the Group or the undertaking or part of the undertaking of such Subsidiary, being transferred otherwise than to another company within the Group; or for any other reason, provided the Committee gives its consent in writing, he may, at the absolute discretion of the Committee, exercise any unexercised Options within the relevant Option Period and upon the expiry of such period, the Option shall immediately lapse and become null and void.

(b)

11.6

If a Participant dies and at the date of his death holds any unexercised Option, such Option may, at the absolute discretion of the Committee, be exercised by the duly appointed legal personal representatives of the Participant within the relevant Option Period and upon the expiry of such period, the Option shall immediately lapse and become null and void. If a Participant, who is also an Executive Director, ceases to be a Director for any reason whatsoever, he may, at the absolute discretion of the Committee, exercise any unexercised Option within the relevant Option Period and upon the expiry of such period, the Option shall immediately lapse and become null and void.

11.7

F-10

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
12. 12.1 EXERCISE OF OPTIONS, ALLOTMENT AND LISTING OF SHARES An Option may be exercised, in whole or in part (provided that an Option may be exercised in part only in respect of 1,000 Shares or any multiple thereof), by a Participant giving notice in writing to the Company in or substantially in the form set out in Schedule C (the “ Exercise Notice ”), subject to such amendments as the Committee may from time to time determine. Every Exercise Notice must be accompanied by a remittance for the full amount of the aggregate Exercise Price in respect of the Shares which have been exercised under the Option, the relevant CDP charges (if any) and any other documentation the Committee may require. All payments shall be made by cheque, cashier’s order, bank draft or postal order made out in favour of the Company. An Option shall be deemed to be exercised upon the receipt by the Company of the abovementioned Notice duly completed and the receipt by the Company of the full amount of the aggregate Exercise Price in respect of the Shares which have been exercised under the Option. Subject to: (a) such consents or other actions required by any competent authority under any regulations or enactments for the time being in force as may be necessary; and compliance with the Rules, the Act and the Memorandum of Association of the Company, the Company shall, as soon as practicable after the exercise of an Option by a Participant but in any event within 10 Market Days after the date of the exercise of the Option in accordance with Rule 12.1, allot the Shares in respect of which such Option has been exercised by the Participant and within five Market Days from the date of such allotment, despatch the relevant share certificates to CDP for the credit of the securities account of that Participant by ordinary post or such other mode of delivery as the Committee may deem fit.

12.2

(b)

12.3

The Company shall, if necessary, as soon as practicable after the exercise of an Option, apply for the listing and quotation of the Shares which may be issued upon exercise of the Option and the Shares (if any) which may be issued to the Participant pursuant to any adjustments made in accordance with Rule 10. Shares which are allotted on the exercise of an Option by a Participant shall be issued, as the Participant may elect, in the name of CDP to the credit of the securities account of the Participant maintained with CDP or the Participant’s securities sub-account with a CDP Depository Agent. Shares allotted and issued upon the exercise of an Option shall be subject to all provisions of the Memorandum and Articles of Association of the Company and shall rank pari passu in all respects with the then existing issued Shares in the capital of the Company except for any dividends, rights, allotments or other distributions, the Record Date for which is prior to the date such Option is exercised. The Company shall keep available sufficient unissued Shares to satisfy the full exercise of all Options for the time being remaining capable of being exercised.

12.4

12.5

12.6

F-11

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
13. 13.1 MODIFICATIONS TO THE ESOS Any or all the provisions of the ESOS may be modified and/or altered at any time and from time to time by resolution of the Committee, except that: (a) any modification or alteration which shall alter adversely the rights attaching to any Option granted prior to such modification or alteration and which in the opinion of the Committee, materially alters the rights attaching to any Option granted prior to such modification or alteration may only be made with the consent in writing of such number of Participants who, if they exercised their Options in full, would thereby become entitled to not less than three-quarters (3/4) of the total number of Shares which would fall to be allotted upon exercise in full of all outstanding Options; any modification or alteration which would be to the advantage of Participants under the ESOS shall be subject to the prior approval of the Shareholders in general meeting; and no modification or alteration shall be made without the prior approval of the Sponsor or (if required) any other stock exchange on which the Shares are quoted and listed, and such other regulatory authorities as may be necessary.

(b)

(c)

For the purposes of Rule 13.1(a), the opinion of the Committee as to whether any modification or alteration would alter adversely the rights attaching to any Option shall be final and conclusive. 13.2 Notwithstanding anything to the contrary contained in Rule 13.1, the Committee may at any time by resolution (and without other formality, save for the prior approval of the Sponsor) amend or alter the ESOS in any way to the extent necessary to cause the ESOS to comply with any statutory provision or the provisions or the regulations of any regulatory or other relevant authority or body. Written notice of any modification or alteration made in accordance with this Rule 13 shall be given to all Participants. DURATION OF THE ESOS The ESOS shall continue to be in force at the discretion of the Committee, subject to a maximum period of 10 years, commencing on the date on which the ESOS is adopted by the Company in general meeting. Subject to compliance with any applicable laws and regulations in Singapore, the ESOS may be continued beyond the above stipulated period with the approval of the Shareholders by ordinary resolution at a general meeting and of any relevant authorities which may then be required. The ESOS may be terminated at any time by the Committee or by ordinary resolution of the Shareholders at a general meeting subject to all other relevant approvals which may be required and if the ESOS is so terminated, no further Options shall be offered by the Company hereunder.

13.3

14. 14.1

14.2

F-12

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
14.3 The termination, discontinuance or expiry of the ESOS shall be without prejudice to the rights accrued to Options which have been granted and accepted as provided in Rule 8, whether such Options have been exercised (whether fully or partially) or not. TAKE-OVER AND WINDING UP OF THE COMPANY In the event of a take-over offer being made for the Company, Participants (including Participants holding Options which are then not exercisable pursuant to the provisions of Rules 11.1 and 11.2) holding Options as yet unexercised shall, notwithstanding Rules 11 and 12 but subject to Rule 15.5, be entitled to exercise such Options in full or in part during the period commencing on the date on which such offer is made or, if such offer is conditional, the date on which the offer becomes or is declared unconditional, as the case may be, and ending on the earlier of: (a) the expiry of six months thereafter, unless prior to the expiry of such six month period, at the recommendation of the offeror and with the approvals of the Committee and the Sponsor, such expiry date is extended to a later date (being a date falling not later than the date of expiry of the Option Period relating thereto); or the date of the expiry of the Option Period relating thereto,

15. 15.1

(b)

whereupon any Option then remaining unexercised shall immediately lapse and become null and void. Provided always that if during such period the offeror becomes entitled or bound to exercise the rights of compulsory acquisition of the Shares under the provisions of the Act and, being entitled to do so, gives notice to the Participants that it intends to exercise such rights on a specified date, the Option shall remain exercisable by the Participants until such specified date or the expiry of the Option Period relating thereto, whichever is earlier. Any Option not so exercised by the said specified date shall lapse and become null and void. Provided that the rights of acquisition or obligation to acquire stated in the notice shall have been exercised or performed, as the case may be. If such rights of acquisition or obligations have not been exercised or performed, all Options shall, subject to Rule 11.3, remain exercisable until the expiry of the Option Period. 15.2 If, under any applicable laws, the court sanctions a compromise or arrangement proposed for the purposes of, or in connection with, a scheme for the reconstruction of the Company or its amalgamation with another corporation or corporations, Participants (including Participants holding Options which are then not exercisable pursuant to the provisions of Rule 11.1 and 11.2) shall notwithstanding Rules 11 and 12 but subject to Rule 15.5, be entitled to exercise any Option then held by them during the period commencing on the date upon which the compromise or arrangement is sanctioned by the court and ending either on the expiry of 60 days thereafter or the date upon which the compromise or arrangement becomes effective, whichever is later (but not after the expiry of the Option Period relating thereto), whereupon any unexercised Option shall lapse and become null and void, Provided always that the date of exercise of any Option shall be before the expiry of the relevant Option Period.

F-13

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
15.3 If an order or an effective resolution is passed for the winding up of the Company on the basis of its insolvency, all Options, to the extent unexercised, shall lapse and become null and void. In the event a notice is given by the Company to its members to convene a general meeting for the purposes of considering and, if thought fit, approving a resolution to voluntarily wind-up the Company, the Company shall on the same date as or soon after it despatches such notice to each member of the Company give notice thereof to all Participants (together with a notice of the existence of the provision of this Rule 15.4) and thereupon, each Participant (or his personal representative) shall be entitled to exercise all or any of his Options at any time not later than two business days prior to the proposed general meeting of the Company by giving notice in writing to the Company, accompanied by a remittance for the full amount of the aggregate Exercise Price for the shares in respect of which the notice is given whereupon the Company shall as soon as possible and in any event, no later than the business day immediately prior to the date of the proposed general meeting referred to above, allot the relevant Shares to the Participant credited as fully paid. If in connection with the making of a general offer referred to in Rule 15.1 above or the scheme referred to in Rule 15.2 above or the winding up referred to in Rule 15.4 above, arrangements are made (which are confirmed in writing by the Auditors, acting only as experts and not as arbitrators, to be fair and reasonable) for the compensation of Participants, whether by the continuation of their Options or the payment of cash or the grant of other options or otherwise, a Participant holding an Option, which is not then exercisable, may not, at the discretion of the Committee, be permitted to exercise that Option as provided for in this Rule 15. If the events stipulated in this Rule 15 should occur, to the extent that an Option is not exercised within the respective periods referred to herein in this Rule 15, it shall lapse and become null and void. ADMINISTRATION OF THE ESOS The ESOS shall be administered by the Committee in its absolute discretion with such powers and duties as are conferred upon it by the Board. The Committee shall have the power, from time to time, to make or vary such regulations (not being inconsistent with the ESOS) as it may consider necessary, desirable or expedient for it to administer and give effect to the ESOS. Any decision of the Committee, made pursuant to any Rule of the ESOS (other than a matter to be certified by the Auditors), shall be final and binding (including any decisions pertaining to disputes as to the interpretation of the Rules of the ESOS or any rule, regulation or procedure thereunder or as to any rights under the ESOS). A Director who is a member of the Committee shall not be involved in its deliberation in respect of Options to be granted to him.

15.4

15.5

15.6

16. 16.1

16.2

16.3

16.4

F-14

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
17. 17.1 NOTICES Any notice given by a Participant to the Company shall be sent by post or delivered to the registered office of the Company or such other address as may be notified by the Company to the Participant in writing. Any notice or documents given by the Company to a Participant shall be sent to the Participant by hand or sent to him at his home address stated in the records of the Company or the last known address of the Participant, and if sent by post shall be deemed to have been given on the day immediately following the date of posting. TERMS OF EMPLOYMENT UNAFFECTED The ESOS or any Option shall not form part of any contract of employment between the Company or any Subsidiary (as the case may be) and any Participant and the rights and obligations of any individual under the terms of the office or employment with such company within the Group shall not be affected by his participation in the ESOS or any right which he may have to participate in it or any Option which he may hold and the ESOS or any Option shall afford such an individual no additional rights to compensation or damages in consequence of the termination of such office or employment for any reason whatsoever. The ESOS shall not confer on any person any legal or equitable rights (other than those constituting the Options themselves) against the Company and/or any Subsidiary directly or indirectly or give rise to any cause of action at law or in equity against the Company or any Subsidiary. TAXES All taxes (including income tax) arising from the exercise of any Option granted to any Participant under the ESOS shall be borne by that Participant. 20. 20.1 COSTS AND EXPENSES OF THE ESOS Each Participant shall be responsible for all fees of CDP relating to or in connection with the issue and allotment of any Shares pursuant to the exercise of any Option in CDP’s name, the deposit of share certificate(s) with CDP, the Participant’s securities account with CDP or the Participant’s securities sub-account with a Depository Agent or CPF investment account with a CPF agent bank and all taxes referred to in Rule 19 which shall be payable by the relevant Participant. Save for such costs and expenses expressly provided in the Rules to be payable by the Participants, all fees, costs and expenses incurred by the Company in relation to the ESOS including but not limited to the fees, costs and expenses relating to the allotment and issue of Shares pursuant to the exercise of any Option shall be borne by the Company.

17.2

18. 18.1

18.2

19.

20.2

F-15

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
21. CONDITION OF OPTION Every Option shall be subject to the condition that no Shares shall be issued pursuant to the exercise of an Option if such issue would be contrary to the constitutive documents of the Company or any law or enactment, or any rules or regulations of any legislative or non-legislative governing body for the time being in force in Singapore or any other relevant country. 22. DISCLAIMER OF LIABILITY Notwithstanding any provisions herein contained and subject to the Act, the Board, the Committee and the Company shall not under any circumstances be held liable for any costs, losses, expenses and damages whatsoever and howsoever arising in respect of any matter under or in connection with the ESOS, including but not limited to the Company’s delay in allotting and issuing the Shares or in applying for or procuring the listing of the Shares on Catalist (or any other relevant stock exchange). 23. DISCLOSURE IN ANNUAL REPORT The Company shall make the following disclosure in its annual report: (a) (b) the names of the members of the Committee; the information required in the table below for the following Participants (which for the avoidance of doubt, shall include Participants who have exercised all their Options in any particular financial year): (i) (ii) Participants who are Directors of the Company; and Participants who are Controlling Shareholders of the Company and their Associates; and

(iii) Participants, other than those in (i) and (ii) above, who receive 5% or more of the total number of Options available under the ESOS;
Options granted during financial year under review (including terms) Aggregate Options granted since commencement of the ESOS to end of financial year under review Aggregate Options exercised since commencement of the ESOS to end of financial year under review

Name of Participant

Aggregate Options outstanding as at end of financial year under review

F-16

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
(c) in respect of Options granted to directors and employees of the parent company and its subsidiaries: (i) the names of and number and terms of Options granted to each director or employee of the parent company and its subsidiaries who receives 5% or more of the total number of Options available to all directors and employees of the parent company and its subsidiaries under the scheme, during the financial year under review; and the aggregate number of Options granted to the directors and employees of the parent company and its subsidiaries for the financial year under review, and since the commencement of the ESOS to the end of the financial year under review.

(ii)

(d)

the number and proportion of Options granted at the following discounts to average market value of the Shares in the financial year under review: (i) (ii) Options granted at up to 10% discount; and Options granted at between 10% but not more than 20% discount.

Provided that if any of the above requirements is not applicable, an appropriate negative statement must be included. 24. ABSTENTION FROM VOTING Shareholders who are eligible to participate in the ESOS shall abstain from voting on any Shareholders’ resolution relating to the ESOS. 25. DISPUTES Any disputes or differences of any nature arising hereunder shall be referred to the Committee and its decision shall be final and binding in all respects. 26. GOVERNING LAW The ESOS shall be governed by, and construed in accordance with, the laws of the Republic of Singapore. The Participants, by accepting Options in accordance with the ESOS, and the Company submit to the exclusive jurisdiction of the courts of the Republic of Singapore.

F-17

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
Schedule A PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME LETTER OF OFFER Serial No: Date: To: [Name] [Designation] [Address]

Private and Confidential

Dear Sir/Madam, 1. We have the pleasure of informing you that, pursuant to the PS Group Holdings Employee Share Option Scheme (the “ ESOS ”), you have been nominated to participate in the ESOS by the Committee (the “ Committee ”) appointed by the Board of Directors of PS Group Holdings Ltd. (the “ Company ”) to administer the ESOS. Terms as defined in the Rules of the ESOS shall have the same meaning when used in this letter. Accordingly, in consideration of the payment of a sum of S$1.00, an offer is hereby made to Shares at grant you an option (the “ Option ”), to subscribe for and be allotted the price of S$ per Share. The Option is personal to you and shall not be transferred, charged, pledged, assigned or otherwise disposed of by you, in whole or in part, except with the prior approval of the Committee. The Option shall be subject to the terms of the ESOS, a copy of which is available for inspection at the business address of the Company. If you wish to accept the offer of the Option on the terms of this letter, please sign and return the enclosed Acceptance Form with a sum of S$1.00 not later than 5.00 p.m. on , failing which this offer will lapse.

2.

3.

4.

5.

Yours faithfully, For and on behalf of PS Group Holdings Ltd.

Name: Designation: F-18

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
Schedule B PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME ACCEPTANCE FORM Serial No: Date: To: The Committee PS Group Holdings Ltd. 3 Kaki Bukit Road 2 #01-06/07 Eunos Warehouse Complex Singapore 417837

Closing Date for Acceptance of Offer Number of Shares Offered Exercise Price for each Share Total Amount Payable

: : : : S$ S$

and agree to be bound by the I have read your Letter of Offer dated terms of the Letter of Offer and ESOS referred to therein. Terms defined in your Letter of Offer shall have the same meanings when used in this Acceptance Form. Shares at S$ per I hereby accept the Option to subscribe for Share. I enclose cash for S$1.00 in payment for the purchase of the Option/I authorise my employer to deduct the sum of S$1.00 from my salary in payment for the purchase of the Option. I understand that I am not obliged to exercise the Option. I confirm that my acceptance of the Option will not result in the contravention of any applicable law or regulation in relation to the ownership of Shares in the Company or options to subscribe for such Shares. I further acknowledge and confirm that you have not made any representation to induce me to accept the offer in respect of the said Option and that the terms of the Letter of Offer and this Acceptance Form constitute the entire agreement between us relating to the offer.

F-19

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
Please print in block letters Name in full Designation Address Nationality *NRIC/Passport No. Signature Date : : : : : : :

Note: * Delete where inapplicable

F-20

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
Schedule C PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME EXERCISE NOTICE

Total number of ordinary shares (the per “ Shares ”) offered at S$ Share (the “ Exercise Price ”) under the ESOS on (Date of Grant) Number of Shares previously allotted thereunder Outstanding balance of Shares to be allotted thereunder Number of Shares now to be subscribed

:

:

: :

To:

The Committee PS Group Holdings Ltd. 3 Kaki Bukit Road 2 #01-06/07 Eunos Warehouse Complex Singapore 417837 Pursuant to your Letter of Offer dated I hereby exercise the Option to subscribe Ltd. (the “ Company ”) at S$ per Share. for and my acceptance thereof, for Shares in PS Group Holdings

1.

2.

I enclose a *cheque/cashiers order/banker’s draft/postal order no. S$ by way of subscription for the total number of the said Shares.

3.

I agree to subscribe for the said Shares subject to the terms of the Letter of Offer, the PS Group Holdings Employee Share Option Scheme and the Memorandum and Articles of Association of the Company. I declare that I am subscribing for the said Shares for myself and not as a nominee for any other person. I request the Company to allot and issue the Shares in the name of The Central Depository (Pte) Limited (“ CDP ”) for credit of my *securities account with CDP/Sub-Account with the Depository Agent/CPF investment account with my Agent Bank specified below and I hereby agree to bear such fees or other charges as may be imposed by CDP in respect thereof.

4.

5.

F-21

APPENDIX F – RULES OF THE PS GROUP HOLDINGS EMPLOYEE SHARE OPTION SCHEME
Please print in block letters Name in full Designation Address Nationality *NRIC/Passport No *Direct Securities Account No. OR *Sub Account No. Name of Depository Agent OR *CPF Investment Account No. Name of Agent Bank Signature Date : : : : : : : : : : : :

Note: * Delete where inapplicable

F-22

APPENDIX G – TERMS, CONDITIONS AND PROCEDURES FOR APPLICATION AND ACCEPTANCE
You are invited to apply and subscribe for the Placement Shares at the Placement Price for each Placement Share, subject to the following terms and conditions: 1. YOUR APPLICATION MUST BE MADE IN LOTS OF 1,000 PLACEMENT SHARES OR INTEGRAL MULTIPLES THEREOF. YOUR APPLICATION FOR ANY OTHER NUMBER OF PLACEMENT SHARES WILL BE REJECTED. Your application for the Placement Shares may only be made by way of printed BLUE Placement Shares Application Forms or such other forms of application as the Sponsor and Placement Agent deems appropriate. YOU MAY NOT USE CPF FUNDS TO APPLY FOR THE PLACEMENT SHARES. 3. You (not being an approved nominee company) are allowed to submit only one application in your own name for the Placement Shares. If you, being other than an approved nominee company, have submitted an application for the Placement Shares in your own name, you should not submit any other application for the Placement Shares for any other person. Such separate applications shall be deemed to be multiple applications and may be rejected at the discretion of our Company, the Sponsor and the Placement Agent. Joint and multiple applications for the Placement Shares may be rejected at the discretion of our Company, the Sponsor and the Placement Agent. If you submit or procure submissions of multiple share applications for the Placement Shares, you may be deemed to have committed an offence under the Penal Code, Chapter 224 of Singapore and the SFA, and your applications may be referred to the relevant authorities for investigation. Multiple applications or those appearing to be or suspected of being multiple applications may be rejected at the discretion of our Company, the Sponsor and the Placement Agent. 4. We will not accept applications from any person under the age of 21 years, undischarged bankrupts, sole-proprietorships, partnerships, or non-corporate bodies, joint Securities Account holders of CDP and from applicants whose addresses (as furnished in their Application Forms) bear post office box numbers. No person acting or purporting to act on behalf of a deceased person is allowed to apply under the Securities Account with CDP in the deceased’s name at the time of application. We will not recognise the existence of a trust. Any application by a trustee or trustees must therefore be made in his/her/their own name(s) and without qualification or, where the application is made by way of an Application Form by a nominee, in the name(s) of an approved nominee company or companies after complying with paragraph 6 below. WE WILL NOT ACCEPT APPLICATIONS FROM NOMINEES EXCEPT THOSE MADE BY APPROVED NOMINEE COMPANIES ONLY . Approved nominee companies are defined as banks, merchant banks, finance companies, insurance companies, licensed securities dealers in Singapore and nominee companies controlled by them. Applications made by persons acting as nominees other than approved nominee companies shall be rejected.

2.

5.

6.

G-1

APPENDIX G – TERMS, CONDITIONS AND PROCEDURES FOR APPLICATION AND ACCEPTANCE
7. IF YOU ARE NOT AN APPROVED NOMINEE COMPANY, YOU MUST MAINTAIN A SECURITIES ACCOUNT WITH CDP IN YOUR OWN NAME AT THE TIME OF YOUR APPLICATION. If you do not have an existing Securities Account with CDP in your own name at the time of your application, your application may be rejected. If you have an existing Securities Account with CDP but fail to provide your Securities Account number or provide an incorrect Securities Account number in Section B of the Application Form, your application is liable to be rejected. Subject to paragraph 8 below, your application shall be rejected if your particulars such as name, NRIC/passport number, nationality and permanent residency status provided in your Application Form differ from those particulars in your Securities Account as maintained with CDP. If you possess more than one individual direct Securities Account with CDP, your application may be rejected. If your address as stated in the Application Form is different from the address registered with CDP, you must inform CDP of your updated address promptly, failing which the notification letter on successful allotment and other correspondence from CDP will be sent to your address last registered with CDP. Our Company, the Sponsor and the Placement Agent reserve the right to reject any application which does not conform strictly to the instructions set out in the Application Form and in this Offer Document or with the terms and conditions of this Offer Document or, in the case of an application by way of an Application Form, which is illegible, incomplete, incorrectly completed or which is accompanied by an improperly drawn remittance or improper form of remittance or remittances which are not honoured upon their first presentation. Our Company, the Sponsor and the Placement Agent further reserve the right to treat as valid any applications not completed or submitted or effected in all respects in accordance with the instructions set out in the Application Forms or the terms and conditions of this Offer Document, and also to present for payment or other processes all remittances at any time after receipt and to have full access to all information relating to, or deriving from, such remittances or the processing thereof.

8.

9.

10. Our Company, the Sponsor and the Placement Agent reserve the right to reject or to accept, in whole or in part, or to scale down or to ballot any application, without assigning any reason therefor, and no enquiry and/or correspondence on the decision of our Company, the Sponsor and the Placement Agent with regards hereto will be entertained. In deciding the basis of allotment, which shall be at the discretion of our Company, the Sponsor and the Placement Agent, due consideration will be given to the desirability of allotting the Placement Shares to a reasonable number of applicants with a view to establishing an adequate market for the Shares and this basis of allotment of the Placement Shares shall be made public as soon as practicable through a SGXNET announcement to be posted on the internet at the SGX-ST’s website at http://www.sgx.com and through an advertisement in a local English newspaper. 11. Share certificates will be registered in the name of CDP or its nominee and will be forwarded only to CDP. It is expected that CDP will send to you, at your own risk, within 15 Market Days after the close of the Application List, a statement of account stating that your Securities Account has been credited with the number of Placement Shares allotted to you, if your application is successful. This will be the only acknowledgement of application monies received and is not an acknowledgement by our Company. You irrevocably authorise CDP to

G-2

APPENDIX G – TERMS, CONDITIONS AND PROCEDURES FOR APPLICATION AND ACCEPTANCE
complete and sign on your behalf, as transferee or renouncee, any instrument of transfer and/or other documents required for the issue or transfer of the Placement Shares allotted to you. 12. In the event that a supplementary or replacement offer document is lodged with the SGX-ST acting as agent on behalf of the Authority, the Placement shall be kept open for at least 14 days after the lodgement of such supplementary or replacement offer document. Where prior to the lodgement of the supplementary or replacement offer document, applications have been made under this Offer Document to subscribe for the Placement Shares and: (a) where the Placement Shares have not been issued to the applicants, we shall either: (i) within two days (excluding any Saturday, Sunday or public holiday) from the date of lodgement of the supplementary or replacement offer document, give the applicants notice in writing of how to obtain, or arrange to receive, a copy of the same and provide the applicants with an option to withdraw their applications, and take all reasonable steps to make available within a reasonable period the supplementary or replacement offer document, as the case may be, to the applicants who have indicated that they wish to obtain, or who have arranged to receive, a copy of the supplementary or replacement offer document; or within seven days from the date of lodgement of the supplementary or replacement offer document, give the applicants the supplementary or replacement offer document, as the case may be, and provide the applicants with an option to withdraw their applications; or

(ii)

(iii) treat the applications as withdrawn and cancelled, in which case the applications shall be deemed to have been withdrawn and cancelled, and we shall, within seven days from the date of lodgement of the supplementary or replacement offer document, pay to the applicants all monies which they have paid on account of their applications for the Placement Shares without interest or any share of revenue or other benefit arising therefrom at the applicants’ own risk, and the applicants shall not have any claim whatsoever against our Company, the Sponsor or the Placement Agent; or (b) where the Placement Shares have been issued to the applicants but trading has not commenced, we shall either: (i) within two days (excluding any Saturday, Sunday or public holiday) from the date of lodgement of the supplementary or replacement offer document, give the applicants notice in writing of how to obtain, or arrange to receive, a copy of the supplementary or replacement after document, as the case may be, and provide the applicants with an option to return to us the Placement Shares which they do not wish to retain title in, and take all reasonable steps to make available within a reasonable period the supplementary or replacement offer document, as the case may be, to the applicants who have indicated that they wish to obtain, or who have arranged to receive, a copy of the supplementary or replacement offer document; or

G-3

APPENDIX G – TERMS, CONDITIONS AND PROCEDURES FOR APPLICATION AND ACCEPTANCE
(ii) within seven days from the date of lodgement of the supplementary or replacement offer document, give the applicants a copy of the supplementary or replacement offer document, as the case may be, and provide the applicants with an option to return to us the Placement Shares which they do not wish to retain title in; or

(iii) treat the issue of the Placement Shares as void, in which case the issue shall be deemed void and we shall, within seven days from the date of lodgement of the supplementary or replacement offer document, pay to the applicants all monies which they have paid on account of their applications for the Placement Shares without interest or any share of revenue or other benefit arising therefrom at the applicants’ own risk, and the applicants shall not have any claim whatsoever against our Company, the Sponsor or the Placement Agent. An applicant who wishes to exercise his option under paragraph (a)(i) or (ii) above to withdraw his application shall, within 14 days from the date of lodgement of the supplementary or replacement offer document, notify us of this, whereupon we shall, within seven days from the receipt of such notification, pay to him all monies paid by him on account of his application for the Placement Shares, without interest or any share of revenue or other benefit arising therefrom, at his own risk and he shall not have any claim against our Company, the Sponsor or the Placement Agent. An applicant who wishes to exercise his option under paragraph (b)(i) or (ii) above to return the Placement Shares issued to him shall, within 14 days from the date of lodgement of the supplementary or replacement offer document, notify us of this and return all documents, if any, purporting to be evidence of title to those Placement Shares to us, whereupon we shall, within seven days from the receipt of such notification and documents, if any, pay to him all monies which he had paid on account of his application for the Placement Shares, without interest or any share of revenue or other benefit arising therefrom at his own risk, and the issue of those Placement Shares shall be deemed to be void and he shall not have any claim against our Company, the Sponsor or the Placement Agent. 13. You irrevocably authorise CDP to disclose the outcome of your application, including the number of Placement Shares allotted to you pursuant to your application, to us, the Sponsor and the Placement Agent and any other parties so authorised by the foregoing persons. 14. Any reference to “you” or the “applicant” in this section shall include an individual, a corporation, an approved nominee company and trustee applying for the Placement Shares by way of an Application Form or such other forms of application as the Sponsor and the Placement Agent may deem appropriate. 15. By completing and delivering an Application Form or such other forms of application as the Sponsor and the Placement Agent may deem appropriate in accordance with the provisions of this Offer Document, you: (a) irrevocably offer, agree and undertake to subscribe for the number of Placement Shares specified in your application (or such smaller number for which the application is accepted) at the Placement Price for each Placement Share and agree that you will accept such Placement Shares as may be allotted to you, in each case on the terms of, and subject to the conditions set out in this Offer Document, the Application Forms and the Memorandum and Articles of Association of our Company;

G-4

APPENDIX G – TERMS, CONDITIONS AND PROCEDURES FOR APPLICATION AND ACCEPTANCE
(b) agree that the aggregate Placement Price for the Placement Shares applied for is due and payable to our Company upon application; warrant the truth and accuracy of the information contained, and representations and declarations made, in your application, and acknowledge and agree that such information, representations and declarations will be relied on by our Company, the Sponsor and the Placement Agent in determining whether to accept your application and/or whether to allot any Placement Shares to you; and agree and warrant that, if the laws of any jurisdictions outside Singapore are applicable to your application, you have complied with all such laws and none of our Company, the Sponsor and the Placement Agent will infringe any such laws as a result of the acceptance of your application.

(c)

(d)

16. Our acceptance of applications for the Placement Shares will be conditional upon, inter alia, our Company being satisfied that: (a) (b) the Placement Shares have been issued; permission has been granted by the SGX-ST for the listing and quotation of all our existing issued Shares, the Placement Shares, the Performance Shares and the Option Shares on Catalist; the Management Agreement and the Placement Agreement referred to in the section entitled “ General and Statutory Information – Management and Placement Arrangements ” of this Offer Document have become unconditional and have not been terminated or cancelled prior to such date as our Company may determine; and the Authority, the SGX-ST (acting as agent on behalf of the Authority) or other competent authority has not served a stop order (“ Stop Order ”) which directs that no or no further shares to which this Offer Document relates be allotted.

(c)

(d)

17. In the event that a Stop Order in respect of the Placement Shares is issued by the Authority, the SGX-ST (acting as agent on behalf of the Authority) or other competent authority, and: (a) in the case where the Placement Shares have not been issued to the applicants, the applications of the Placement Shares pursuant to the Placement shall be deemed to have been withdrawn and cancelled and our Company shall, within 14 days from the date of the Stop Order, pay to the applicants all monies the applicants have paid on account of their applications for the Placement Shares; or in the case where the Placement Shares have been issued to the applicants, the issue of the Placement Shares pursuant to the Placement shall be deemed to be void and our Company shall, within 14 days from the date of the Stop Order, pay to the applicants all monies paid by them for the Placement Shares.

(b)

Such monies paid in respect of your application will be returned to you at your own risk, without interest or any share of revenue or other benefit arising therefrom, and you will not have any claim against us, the Sponsor or the Placement Agent. This shall not apply where only an interim Stop Order has been served.

G-5

APPENDIX G – TERMS, CONDITIONS AND PROCEDURES FOR APPLICATION AND ACCEPTANCE
18. In the event that an interim Stop Order in respect of the Placement Shares is served by the Authority, the SGX-ST (acting as agent on behalf of the Authority) or other competent authority, no Placement Shares shall be issued to you during the time when the interim Stop Order is in force. 19. The Authority, the SGX-ST (acting as agent on behalf of the Authority) or other competent authority is not able to serve a Stop Order in respect of the Placement Shares if the Placement Shares have been issued, listed for quotation on a securities exchange and trading in the Placement Shares has commenced. 20. We will not hold any application in reserve. 21. We will not allot, issue or sell Shares on the basis of this Offer Document later than six months after the date of registration of this Offer Document by the SGX-ST acting as agent on behalf of the Authority. 22. Additional terms and conditions for applications by way of Application Forms are set out on pages G-6 to G-9 of this Offer Document. ADDITIONAL TERMS AND CONDITIONS FOR APPLICATIONS USING APPLICATION FORMS Applications by way of an Application Form shall be made on, and subject to, the terms and conditions of this Offer Document including but not limited to the terms and conditions appearing below as well as those set out under the section entitled “ Terms, Conditions and Procedures for Application and Acceptance ” of this Offer Document, as well as the Memorandum and Articles of Association of our Company. 1. Your application for the Placement Shares must be made using the BLUE Application Forms accompanying and forming part of this Offer Document or such other forms of application as the Sponsor and the Placement Agent may deem appropriate for Placement Shares. We draw your attention to the detailed instructions contained in the Application Forms and this Offer Document for the completion of the Application Forms which must be carefully followed. Our Company, the Sponsor and Placement Agent reserve the right to reject applications which do not conform strictly to the instructions set out in the Application Forms and this Offer Document or to the terms and conditions of this Offer Document or which are illegible, incomplete, incorrectly completed or which are accompanied by improperly drawn remittances or improper forms of remittance. 2. Your Application Forms must be completed in English. Please type or write clearly in ink using BLOCK LETTERS . All spaces in the Application Forms except those under the heading “ FOR OFFICIAL USE ONLY ” must be completed and the words “ NOT APPLICABLE ” or “ N.A. ” should be written in any space that is not applicable. Individuals, corporations, approved nominee companies and trustees must give their names in full. If you are an individual, you must make your application using your full name as it appears in your identity card (if you have such an identification document) or in your passport and, in the case of a corporation, in your full name as registered with a competent authority.

3.

4.

G-6

APPENDIX G – TERMS, CONDITIONS AND PROCEDURES FOR APPLICATION AND ACCEPTANCE
If you are a non-individual, you must complete the Application Form under the hand of an official who must state the name and capacity in which he signs the Application Form. If you are a corporation completing the Application Form, you are required to affix your Common Seal (if any) in accordance with your Memorandum and Articles of Association or equivalent constitutive documents of the corporation. If you are a corporate applicant and your application is successful, a copy of your Memorandum and Articles of Association or equivalent constitutive documents must be lodged with our Company’s Share Registrar and Share Transfer Office. Our Company, the Sponsor and Placement Agent reserve the right to require you to produce documentary proof of identification for verification purposes. 5. (a) (b) You must complete Sections A and B and sign on page 1 of the Application Form. You are required to delete either paragraph 7(a) or 7(b) on page 1 of the Application Form. Where paragraph 7(a) is deleted, you must also complete Section C of the Application Form with particulars of the beneficial owner(s). If you fail to make the required declaration in paragraph 7(a) or 7(b), as the case may be, on page 1 of the Application Form, your application is liable to be rejected.

(c)

You (whether you are an individual or corporate applicant, whether incorporated or unincorporated and wherever incorporated or constituted) will be required to declare whether you are a citizen or permanent resident of Singapore or a corporation in which citizens or permanent residents of Singapore or any body corporate constituted under any statute of Singapore having an interest in the aggregate of more than 50% of the issued share capital of or interests in such corporations. If you are an approved nominee company, you are required to declare whether the beneficial owner of the Shares is a citizen or permanent resident of Singapore or a corporation, whether incorporated or unincorporated and wherever incorporated or constituted, in which citizens or permanent residents of Singapore or any body corporate whether incorporated or unincorporated and wherever incorporated or constituted under any statute of Singapore have an interest in the aggregate of more than 50% of the issued share capital of or interests in such corporation. 6. You may apply and make payment for the Placement Shares using cash only. Your application must be accompanied by a remittance in Singapore currency for the full amount payable, in respect of the number of Placement Shares applied for, in the form of a BANKER’S DRAFT or CASHIER’S ORDER drawn on a bank in Singapore, made out in favour of “ PS GROUP HOLDINGS SHARE ISSUE ACCOUNT ” crossed “ A/C PAYEE ONLY ”, and with your name and address written clearly on the reverse side. Applications not accompanied by any payment or accompanied by any other form of payment will not be accepted . ANY OTHER FORM OF PAYMENT WILL NOT BE ACCEPTED. We will reject remittances bearing “ NOT TRANSFERABLE ” or “ NON TRANSFERABLE ” crossings. The completed and signed BLUE Placement Shares Application Form and the correct remittance in full in respect of the number of Placement Shares applied for (in accordance with the terms and conditions of this Offer Document) with your name and address written clearly on the reverse side, must be enclosed and sealed in an envelope to be provided by you. You must affix adequate Singapore postage on the envelope (if despatching by ordinary post) and thereafter the sealed envelope must be DESPATCHED BY ORDINARY POST OR DELIVERED BY HAND at your own risk to PS GROUP HOLDINGS LTD. c/o TRICOR BARBINDER SHARE REGISTRATION SERVICES, 80 ROBINSON ROAD, #02-00, SINGAPORE 068898, to arrive by 12.00 noon on 9 July 2013 or such other time as our

G-7

APPENDIX G – TERMS, CONDITIONS AND PROCEDURES FOR APPLICATION AND ACCEPTANCE
Company may, in consultation with the Sponsor and the Placement Agent, decide. Local Urgent Mail or Registered Post must NOT be used . No acknowledgement or receipt will be issued by our Company, or the Sponsor or the Placement Agent for applications and application monies received. 7. Monies paid in respect of unsuccessful applications are expected to be returned (without interest or any share of revenue or other benefit arising therefrom) to you by ordinary post at your own risk. Where your application is rejected or accepted in part only, the full amount or the balance of the application monies, as the case may be, will be refunded (without interest or any share of revenue or other benefit arising therefrom) to you by ordinary post at your own risk within 14 days after the close of the Application List, provided that the remittance accompanying such application which has been presented for payment or other processes has been honoured and application monies have been received in the designated share issue account. In the event that the Placement is cancelled by us following the termination of the Management Agreement and/or the Placement Agreement, the application monies received will be refunded (without interest or any share of revenue or other benefit arising therefrom) to you by ordinary post at your own risk within five Market Days of the termination of the Placement. In the event that the Placement is cancelled by us following the issuance of a Stop Order by the Authority, the SGX-ST (acting as agent on behalf of the Authority) or other competent authority, the application monies received will be refunded (without interest or any share of revenue or other benefit arising therefrom) to you by ordinary post at your own risk within 14 days from the date of the Stop Order. Capitalised terms used in the Application Form and defined in this Offer Document shall bear the meanings assigned to them in this Offer Document. You irrevocably agree and acknowledge that your application is subject to risks of fires, acts of God and other events beyond the control of our Company, our Directors, the Sponsor, the Placement Agent and/or any other party involved in the Placement, and if, in any such event, our Company and/or the Sponsor and/or the Placement Agent does not receive your Application Form, you shall have no claim whatsoever against our Company, the Sponsor and the Placement Agent and/or any other party involved in the Placement for the Placement Shares applied for or for any compensation, loss or damage.

8.

9.

10. By completing and delivering the Application Form, you agree that: (a) in consideration of our Company having distributed the Application Form to you and agreeing to close the Application List at 12.00 noon on 9 July 2013 or such other time or date as our Company may, in consultation with the Sponsor and the Placement Agent, decide: (i) (ii) your application is irrevocable; and your remittance will be honoured on first presentation and that any application monies returnable may be held pending clearance of your payment without interest or any share of revenue or other benefit arising therefrom;

(b)

neither our Company, the Sponsor, the Placement Agent nor any other party involved in the Placement shall be liable for any delays, failures or inaccuracies in the recording, storage or in the transmission or delivery of data relating to your application to us or

G-8

APPENDIX G – TERMS, CONDITIONS AND PROCEDURES FOR APPLICATION AND ACCEPTANCE
CDP due to breakdowns or failure of transmission, delivery or communication facilities or any risks referred to in paragraph 9 above or to any cause beyond their respective controls; (c) all applications, acceptances and contracts resulting therefrom under the Placement shall be governed by and construed in accordance with the laws of Singapore and that you irrevocably submit to the non-exclusive jurisdiction of the Singapore courts; in respect of the Placement Shares for which your application has been received and not rejected, acceptance of your application shall be constituted by written notification and not otherwise, notwithstanding any remittance being presented for payment by or on behalf of our Company; you will not be entitled to exercise any remedy of rescission for misrepresentation at any time after acceptance of your application; in making your application, reliance is placed solely on the information contained in this Offer Document and that none of our Company, the Sponsor and the Placement Agent or any other person involved in the Placement shall have any liability for any information not so contained; you consent to the disclosure of your name, NRIC/passport number, address, nationality, permanent resident status, CDP Securities Account number, and share application amount to our Share Registrar, CDP, SCCS, SGX-ST, our Company, the Sponsor, the Placement Agent or other authorised operators; and you irrevocably offer, agree and undertake to subscribe for the number of Placement Shares applied for as stated in the Application Form or any smaller number of such Placement Shares that may be allotted to you in respect of your application. In the event that our Company decides to allot a smaller number of Placement Shares or not to allot any Placement Shares to you, you agree to accept such decision as final.

(d)

(e)

(f)

(g)

(h)

G-9

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®

PS GROUP HOLDINGS LTD.
(Company Registration No.: 201311530Z) (Incorporated in the Republic of Singapore on 30 April 2013)

3 Kaki Bukit Road 2, #01-06, Eunos Warehouse Complex, Singapore 417837 • T: 6747 7080 • F: 6742 0642 http://www.psfasteners.com

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