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NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN, INTO OR

FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE

RELEVANT LAWS OF THAT JURISDICTION. THIS ANNOUNCEMENT SHALL NOT CONSTITUTE

AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO SUBSCRIBE FOR OR BUY

SECURITIES IN ANY JURISDICTION, INCLUDING IN THE UNITED STATES.

Innovalues Limited

(UEN/Reg. No: 199702822E)

(Incorporated in Singapore)

Precision Solutions Limited

(Company Registration No: 313918)

(Incorporated in the Cayman Islands)

JOINT ANNOUNCEMENT

PROPOSED ACQUISITION BY PRECISION SOLUTIONS LIMITED OF ALL THE ISSUED

ORDINARY SHARES IN THE CAPITAL OF INNOVALUES LIMITED

BY WAY OF A SCHEME OF ARRANGEMENT

1. INTRODUCTION

1.1 The Scheme. The respective boards of directors of Innovalues Limited (the “Company” or

“Innovalues”) and Precision Solutions Limited (the “Offeror”) are pleased to announce the

proposed acquisition (the “Acquisition”) of all the issued ordinary shares in the capital of the

Company (the “Innovalues Shares”) by the Offeror, a special purpose company incorporated

under the laws of the Cayman Islands, which is an indirect wholly-owned subsidiary of

Northstar Equity Partners IV Limited (“Northstar IV Fund”), an investment fund advised and

managed by Northstar Advisors Pte. Ltd. (“Northstar”). The Acquisition will be effected by the

Company by way of a scheme of arrangement (the “Scheme”) in accordance with Section

210 of the Companies Act, Chapter 50 of Singapore (the “Companies Act”) and the

Singapore Code on Take-overs and Mergers (the “Code”).

1.2 Implementation Agreement. In connection with the Acquisition, the Offeror, Precision

Solutions Group, which is the sole shareholder of the Offeror and a special purpose vehicle

incorporated in the Cayman Islands (“HoldCo”), and the Company (each, a “Party” and

collectively, the “Parties”) have on 25 October 2016 entered into an implementation

agreement (the “Implementation Agreement”) setting out the terms and conditions on which

the Offeror, HoldCo and the Company will implement the Scheme.

2. INFORMATION ON THE PARTIES

2.1 The Company. The Company was incorporated in Singapore on 25 April 1997 and was

listed on the Secondary Board of the Singapore Exchange Securities Trading Limited (the

“SGX-ST”) on 2 March 2001 and the Main Board of the SGX-ST on 8 February 2005. The

Company and its subsidiaries (collectively, the “Innovalues Group” and each, an

“Innovalues Group Company”) are engaged in the business of manufacturing customised

precision machined parts and components, predominantly for the automotive and office

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automation industries. In addition, the Innovalues Group also provides various surface

treatment services for precision machined components.

The board of directors of the Company (the “Board”) comprises the following:

Mr Goh Leng Tse (Chief Executive Officer and Chairman)

Mr Pung Tong Seng (Executive Director)

Mr Ong Tiak Beng (Non-Executive Director)

Mr Anthony Teo Soon Chye (Lead Independent Director)

Mr Liew Yoke Pheng, Joseph (Independent Director)

As at the date of this Joint Announcement (the “Joint Announcement Date”), the Company

has an issued and paid-up share capital of S$13,559,694, comprising 328,109,000

Innovalues Shares.

2.2 Northstar, the Offeror and HoldCo. Northstar is a Singapore-based, MAS-licensed fund

management company managing more than US$2 billion in committed equity capital

dedicated to Southeast Asia. Northstar has a solid track record of actively growing the

businesses of its investee companies. To date, it has invested in more than 30 companies

across various sectors, including banking, insurance, retail, oil and gas, coal and mining

services, technology, telecom and agribusiness.

Each of the Offeror and HoldCo are special purpose vehicles incorporated in the Cayman

Islands for the purposes of the Acquisition.

As at the Joint Announcement Date:

(i) the sole shareholder of the Offeror is HoldCo, and the sole shareholder of HoldCo is

Precision Solutions Partners (the “Founding Shareholder”), which in turn is indirectly

wholly-owned by Northstar IV Fund, an investment fund advised and managed by

Northstar;

(ii) the share capital of the Offeror is US$50,000, divided into 500,000,000 shares of a

par value of US$0.0001 each;

(iii) the share capital of HoldCo is US$50,000, divided into 500,000,000 shares of a par

value of US$0.0001 each (the “HoldCo Shares”); and

(iv) the members of the board of directors of the Offeror and HoldCo are Tan Choon

Hong and Wong Chee Yann, who are employees of Northstar.

3. THE SCHEME

3.1 The Acquisition. Under the Scheme:

3.1.1 all the Innovalues Shares held by the shareholders of the Company (the “Innovalues

Shareholders”) as at a books closure date to be announced by the Company on

which the Transfer Books and the Register of Members of the Company will be

closed in order to determine the entitlements of the Innovalues Shareholders in

respect of the Scheme (the “Books Closure Date”) will be transferred to the Offeror:

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(i) fully paid;

(ii) free from all charges, mortgages, liens, hypothecations, hire purchases,

judgments, encumbrances, easements, security, title retention, preferential

rights, trust arrangements or any other security interests or any other

agreements or arrangements having a commercial effect analogous to the

conferring of security or similar rights in favour of any person

(“Encumbrances”); and

(iii) together with all rights, benefits and entitlements as at the Joint

Announcement Date and thereafter attaching thereto, including the right to

receive and retain all dividends, rights and other distributions (if any) declared

by the Company on or after the Joint Announcement Date. If any dividend,

right or other distribution is declared, paid or made by the Company to the

Innovalues Shareholders on or after the Joint Announcement Date, the

Offeror reserves the right to reduce the Scheme Consideration (as defined

below) by the amount of such dividend, right or distribution; and

3.1.2 in consideration for such transfer, each of the Innovalues Shareholders as at the

Books Closure Date will be entitled to receive for each Innovalues Share (the

“Scheme Consideration”), at their election:

(i) S$1.01 in cash (the “Cash Consideration”); or

(ii) in lieu of the Cash Consideration, S$0.61 in cash and one (1) HoldCo Share

which HoldCo shall allot and issue duly authorised fully paid and free from all

Encumbrances, at an issue price of S$0.40 per HoldCo Share (which shall be

converted into US dollars based on the USD:SGD exchange rate quoted by

Bloomberg on the Effective Date (as defined below)) (the “Issue Price”) (the

“Cash and Securities Consideration”), provided always that no more than

65,000,000 Innovalues Shares1 may be elected for the Cash and Securities

Consideration (the “Maximum Number”).

In the event that the aggregate number of Innovalues Shares that are elected for the

Cash and Securities Consideration exceeds the Maximum Number:

(a) the Maximum Number will be allocated among the electing Innovalues

Shareholders on a pro-rata basis according to the number of Innovalues

Shares they hold; and

(b) in respect of the balance number of Innovalues Shares that are elected for

the Cash and Securities Consideration in excess of the Maximum Number,

each relevant Innovalues Shareholder will receive in cash such amount

equivalent to the HoldCo Shares (based on the Issue Price), which cannot be

allotted and issued to such Innovalues Shareholder,

1 Representing approximately 19.8 per cent. of all of the Innovalues Shares, based on an issued share capital

of 328,109,000 as at the date of this Joint Announcement.

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(the “Adjustment Mechanism”).

The implied value of the Cash and Securities Consideration (based on the Issue Price) will be

the same as the Cash Consideration. The HoldCo Shares will not be listed on any

securities exchange following completion of the Scheme.

For the avoidance of doubt, each Innovalues Shareholder is only entitled to receive the Cash

Consideration or, in lieu thereof, the Cash and Securities Consideration, for all the Innovalues

Shares registered in the Innovalues Shareholder’s name, but not a mixture of both. In the

absence or failure of any valid election by an Innovalues Shareholder to accept the Cash

Consideration or the Cash and Securities Consideration, the Innovalues Shareholder shall

only be entitled to receive the Cash Consideration for all the Innovalues Shares registered in

such Innovalues Shareholder’s name.

Further details will be set out in the Scheme Document (as defined below).

In respect of the Cash Consideration or the cash component of the Cash and Securities

Consideration, the aggregate cash amount that is payable to any Innovalues Shareholder in

respect of the Innovalues Shares held by such Innovalues Shareholder will be rounded down

to the nearest whole cent.

Subject to the Adjustment Mechanism, in respect of the equity component of the Cash and

Securities Consideration, the aggregate number of HoldCo Shares that are issuable to any

Innovalues Shareholder in respect of the Innovalues Shares held by such Innovalues

Shareholder will be rounded down, in each case, to the nearest whole number.

The HoldCo Shares to be issued pursuant to the Scheme becoming effective and binding in

accordance with its terms will, when issued, be validly authorised, validly issued and

outstanding, fully paid and non-assessable and free from Encumbrances (other than

restrictions arising out of applicable securities laws) and all consents, authorisations,

approvals or waivers from any governmental agencies or third parties necessary for such

issuance have been or will, prior to such issuance, be obtained.

3.2 Scheme Document. Further information on the Scheme, the material terms of the HoldCo

Shares which are being offered to the Innovalues Shareholders under the Cash and

Securities Consideration (including the rights of holders of the HoldCo Shares in respect of

capital, dividends and voting), and the terms and conditions upon which the Scheme will be

implemented by the Company, the Offeror and HoldCo will be set out in the document to be

issued by the Company to the Innovalues Shareholders in respect of the Scheme (the

“Scheme Document”).

3.3 Delisting. Upon the Scheme becoming effective and binding, the Company will become a

wholly-owned subsidiary of the Offeror, and will, subject to the approval of the SGX-ST, be

delisted from the Official List of the SGX-ST.

3.4 Switch Option

3.4.1 Pursuant to the terms of the Implementation Agreement, in the event of a Competing

Offer (as defined below) or in the event that an intention to make a Competing Offer

is announced (whether or not such Competing Offer is pre-conditional), the Offeror

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shall have the right at its discretion to elect to proceed by way of a voluntary

conditional cash offer made for or on behalf of the Offeror to acquire all the

Innovalues Shares on the terms and subject to the conditions which will be set out in

the offer document issued for or on behalf of the Offeror (the “Offer”) in lieu of

proceeding by way of the Scheme (the “Switch Option”).

“Competing Offer” means any expression of interest, offer or proposal by any person

other than the Offeror involving (i) a sale, transfer or other disposal of any direct or

indirect interest in some or all of the shares in Innovalues or any Innovalues Group

Company which is (directly or indirectly) a wholly-owned subsidiary of Innovalues

(“Relevant Innovalues Group Company”) or substantially all of the assets, business

and/or undertakings of a Relevant Innovalues Group Company; (ii) a general offer for

the shares in a Relevant Innovalues Group Company; (iii) a scheme of arrangement

involving a Relevant Innovalues Group Company or the merger of a Relevant

Innovalues Group Company with any other entity (whether by way of joint venture,

reverse takeover bid, dual listed company structure or otherwise); or (iv) any other

arrangement having an effect similar to any of (i) to (iii), including a merger or

amalgamation proposal. For the purpose of this definition, a Competing Offer will be

deemed to be for substantially all of the assets, business and/or undertakings of a

Relevant Innovalues Group Company if the relevant assets, business and/or

undertakings in question constitute a “material amount” as defined in Note 2 to Rule 5

of the Code.

3.4.2 If the Offeror exercises the Switch Option, it will make the Offer on the same or better

terms as those which apply to the Scheme, including at a consideration per

Innovalues Share which is the same or greater than the Scheme Consideration, and

conditional upon a level of acceptances set at only more than 50 per cent. of the

Innovalues Shares to which the Offer relates and not conditional on a higher level of

acceptances.

3.4.3 In such event, the Company, the Offeror and HoldCo have agreed that the

Implementation Agreement shall terminate with effect from the date of announcement

of the Offer, save for certain surviving provisions.

4. SCHEME CONDITIONS

4.1 Scheme Conditions. The Scheme is conditional upon the satisfaction or waiver (as the case

may be) of a number of conditions precedent (the “Scheme Conditions”) which are set out in

Schedule 1 to this Joint Announcement.

4.2 Benefit of Scheme Conditions

4.2.1 The Offeror’s Benefit. The Offeror alone may waive the Scheme Conditions in

paragraphs 3, 4, 9 (in relation to the Prescribed Occurrences set out in Schedule 2 to

this Joint Announcement relating to the Innovalues Group Companies) and 11 to 14

of Schedule 1. Any breach or non-fulfilment of any such Scheme Conditions may be

relied upon only by the Offeror. The Offeror may at any time and from time to time at

its sole and absolute discretion waive any such breach or non-fulfilment.

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4.2.2 The Company’s Benefit. The Company alone may waive the Scheme Conditions in

paragraph 9 (in relation to the Prescribed Occurrences relating to the Offeror or,

where applicable, HoldCo) and 10 of Schedule 1. Any breach or non-fulfilment of any

such Scheme Conditions may be relied upon only by the Company. The Company

may at any time and from time to time at its sole and absolute discretion waive any

such breach or non-fulfilment.

4.2.3 Mutual Benefit. The Offeror and the Company may jointly waive the Scheme

Conditions in paragraphs 2 and 8 of Schedule 1 (in each case, to the extent legally

permissible). The Scheme Conditions in paragraphs 1, 5, 6 and 7 of Schedule 1 are

not capable of being waived by either or both of the Company and the Offeror.

5. TERMINATION

5.1 Right to Terminate. The Implementation Agreement provides that the Implementation

Agreement may be terminated at any time prior to the date on which the Scheme becomes

effective in accordance with its terms (the “Effective Date”):

5.1.1 Regulatory Action: by either the Company or the Offeror, if any court of competent

jurisdiction has issued an order, decree or ruling or taken any other action

permanently enjoining, restraining or otherwise prohibiting the Scheme or any part

thereof, or has refused to do anything necessary to permit the Scheme or any part

thereof, and such order, decree, ruling, other action or refusal shall have become final

and non-appealable;

5.1.2 Innovalues Shareholders' Approval: by either the Company or the Offeror, if the

resolutions in respect of the Scheme are not approved (without amendment) by the

requisite majorities of the Innovalues Shareholders at the meeting of the Innovalues

Shareholders to be convened pursuant to the order of the High Court of the Republic

of Singapore (the “Court”) to approve the Scheme and any adjournment thereof (the

“Scheme Meeting”); or

5.1.3 Breach: if there shall have been a breach by any Party of its obligations under the

Implementation Agreement and such breach is material in the context of the Scheme,

by either the Offeror or Innovalues (as the case may be, being the Party not in default

and having the benefit of such obligations) by fourteen (14) days written notice to the

other Parties,

in each case, after prior consultation with the Securities Industry Council (“SIC”).

5.2 Non-fulfilment of Scheme Conditions. Subject to paragraph 4.2, if for any reason the

Scheme Conditions are not satisfied (or, if applicable, waived) or if the Scheme has not

become effective on or before 5.00 p.m. on the date falling six (6) months from the date of the

Implementation Agreement or such other date as the Parties may agree in writing (the

“Conditions Long-Stop Date”), either the Offeror or Innovalues may immediately terminate

the Implementation Agreement (save for certain surviving provisions) by notice in writing to

the other Parties, provided that it has first consulted the SIC and the SIC has given its

approval for, or stated that it has no objection to, such termination.

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5.3 Effect of Termination. In the event of termination of the Implementation Agreement by either

the Company or the Offeror (as the case may be) pursuant to the terms of the Implementation

Agreement, the Implementation Agreement shall terminate (except for certain surviving

provisions such as those relating to confidentiality, costs and expenses and governing law)

and there shall be no other liability on the part of any of the Company, the Offeror or HoldCo,

except that:

5.3.1 in the event of a breach by the Company of Clauses 6.2(a), 6.2(b), 6.2(c), 6.2(d),

6.2(e), 6.2(f), 6.2(g), 6.2(h), 6.2(i), 6.2(o), 6.2(p), 6.2(q) or 6.3 of the Implementation

Agreement (collectively known as the “Specific Obligations”); and/or

5.3.2 in the event a general offer for the Innovalues Shares from a third party (other than

the Offeror) turns unconditional in all respects in accordance with its terms on a date

on or prior to the expiry of five (5) months after the Conditions Long-Stop Date,

the Company shall fully compensate the Offeror for all the costs and expenses incurred by or

on behalf of the Offeror in connection with the Acquisition and/or the Scheme (including the

fees and disbursements of counsel, auditors and advisers engaged by or on behalf of the

Offeror in connection with the Acquisition and/or the Scheme), subject to a maximum amount

of S$3,000,000. Any such payment shall be made by the Company to the Offeror within:

(i) (in the case of a payment under paragraph 5.3.1) ten (10) days after written notice

from the Offeror to the Company stating that a payment obligation under paragraph

5.3.1 is triggered or where the Company issues a notice to the Offeror that it

disagrees that such payment obligation is triggered, within ten (10) days after the

date of the final settlement of such disagreement or a court order ordering that

payment be made (as the case may be); and

(ii) (in the case of a payment under paragraph 5.3.2) ten (10) days after the date on

which the general offer is declared unconditional in all respects in accordance with its

terms.

5.4 Specific Obligations of the Company. The Specific Obligations of the Company are set out

in Schedule 3 to this Joint Announcement.

6. SHARE OPTION SCHEME AND OPTIONS PROPOSAL

6.1 Share Option Scheme. The Company has an employees’ share option scheme (the “Share

Option Scheme”). Under the Share Option Scheme, options are not transferable by the

holders thereof (“Optionholders”). In view of this restriction, the Scheme will not be extended

to the Optionholders.

6.2 Options Proposal. In place of extending the Scheme to the Optionholders, the Offeror

intends to make a proposal (“Options Proposal”) to the Optionholders to pay an

Optionholder a cash amount (computed on a “see-through” basis) (the “Option Price”) in

consideration of such Optionholder agreeing not to exercise all or any of the options held by

him in respect of which he has accepted the Options Proposal (“Relevant Options”), and all

or any rights as a holder of the Relevant Options, in each case from the date of his

acceptance of the Options Proposal to the date of expiry of the respective options. The Option

Price in relation to any Innovalues Share under an option will be equal to the Cash

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Consideration minus the exercise price of that Innovalues Share under the option. Where the

exercise price of an option is equal to or in excess of the Cash Consideration, the Option

Price for each option will be fixed at S$0.001.

The Options Proposal is subject to the Scheme becoming effective and is further subject to

such options continuing, as at the Effective Date, to be exercisable into new Innovalues

Shares.

Details of the Options Proposal will be despatched to the Optionholders on or around the date

of despatch of the Scheme Document to the Innovalues Shareholders. For the avoidance of

doubt, the Scheme will be extended to all Innovalues Shares validly issued pursuant to the

Share Option Scheme prior to the date and time of the Scheme Meeting.

6.3 Exercise Restriction. In the event that there are any outstanding options which have not

been accepted under the Options Proposal on the day immediately after the Scheme is

approved by the Innovalues Shareholders in accordance with the Companies Act, the

Company will be required under the Implementation Agreement to use all reasonable

endeavours to procure that the remuneration committee of the Company shall, to the extent

permitted under the rules of the Share Option Scheme, exercise its discretion under the rules

of the Share Option Scheme not to allow such outstanding options to be exercised any

further.

7. IRREVOCABLE UNDERTAKINGS

7.1 Deeds of Undertaking. Each of Mr Goh Leng Tse (“GLT”), Mr Pung Tong Seng (“SP”), Mr

Ong Tiak Beng (“OTB”) and Mr Koh Boon Hwee (“KBH” and, collectively with GLT, SP and

OTB, the “Undertaking Shareholders”) have given an irrevocable undertaking to the Offeror

(the “Deed of Undertaking”) to, inter alia:

7.1.1 vote in favour of the Scheme at the Scheme Meeting;

7.1.2 vote against and reject any and all resolutions or proposals to approve, implement,

carry out or give effect to any competing offer by a third party (subject in the case of

GLT, OTB and SP, to their respective fiduciary duties as a director of the Company or

any other Innovalues Group Company);

7.1.3 comply with certain non-solicitation and no-talk provisions, in his capacity as an

Innovalues Shareholder;

7.1.4 in the event that the Offeror exercises its Switch Option and makes the Offer in

compliance with paragraph 3.4.2, tender his Innovalues Shares in acceptance of the

Offer;

7.1.5 in the case of GLT, SP and OTB, not exercise the options held by each of them and

to elect to accept the Options Proposal; and

7.1.6 elect to accept, in respect of the relevant Undertaking Shareholder’s Innovalues

Shares:

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(i) in the case of GLT and SP, the Cash Consideration; and

(ii) in the case of KBH and OTB, the Cash and Securities Consideration.

The Undertaking Shareholders have each given the Deed of Undertaking to the Offeror in

respect of 127,045,000 Innovalues Shares held legally and/or beneficially by the Undertaking

Shareholders in the aggregate as at the Joint Announcement Date, representing

approximately 38.73 per cent. of all the Innovalues Shares. Further details of the Innovalues

Shares held by the Undertaking Shareholders as at the Joint Announcement Date are set out

in Schedule 4 to this Joint Announcement.

7.2 Termination. The Deeds of Undertaking will terminate on the earliest of any of the following

dates:

7.2.1 the date falling six (6) months from the date of execution of the Implementation

Agreement;

7.2.2 if the Implementation Agreement is not terminated, the Effective Date;

7.2.3 if the Implementation Agreement lapses or is terminated, the earliest of the date on

which:

(i) the Implementation Agreement lapses or is terminated for any reason without

the Scheme becoming effective (other than a breach by the Undertaking

Shareholders of their respective obligations under the Deeds of Undertaking),

if the Switch Option is not exercised by the Offeror;

(ii) the date the Offer lapses or is withdrawn without having become

unconditional, if the Switch Option is exercised by the Offeror; or

(iii) the date on which the Offer becomes unconditional, if the Switch Option is

exercised by the Offeror; and

7.2.4 in the event a competing general offer for the Company is announced by a third party

after this Joint Announcement, the date on which such offer becomes unconditional in

all respects.

7.3 No Other Irrevocable Undertakings. Save for the Deeds of Undertaking, neither the Offeror

nor any Relevant Person (as defined below) has received any irrevocable undertaking from

any party to vote in favour of the Scheme as at the Joint Announcement Date.

7.4 SIC Confirmation. Pursuant to an application made by the Offeror to the SIC to seek certain

rulings in relation to the Acquisition and the Scheme (the “Application”), the SIC has

confirmed that the Deeds of Undertaking:

7.4.1 in relation to OTB and KBH, do not constitute special deals under Rule 10 of the

Code;

7.4.2 in relation to GLT and SP, do not constitute special deals under Rule 10 of the Code,

subject to the condition set out in paragraph 8.5 below; and

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7.4.3 do not amount to an agreement, arrangement or understanding between the Offeror

and each of the Undertaking Shareholders to co-operate to obtain or consolidate

effective control of the Company.

Accordingly, each of the Undertaking Shareholders will not be precluded from attending and

voting at the Scheme Meeting by virtue of the Deeds of Undertaking.

8. MANAGEMENT INCENTIVE ARRANGEMENTS

8.1 Binding Term Sheet. As the Offeror intends and desires that there is continuity of

management and minimal interruption of the Innovalues Group’s business, Northstar has on

25 October 2016 entered into a term sheet (the “Term Sheet”) with GLT, the chief executive

officer and chairman of the Company, to set out the proposed terms and conditions of (i) the

reinvestment arrangements of GLT and SP into HoldCo, (ii) the shareholder arrangements

between GLT and the Founding Shareholder in respect of HoldCo following completion of the

Scheme, and (iii) the management equity incentive plan to be offered to the management

team of the Innovalues Group (including GLT). Details of such arrangements are set out in

paragraphs 8.2 to 8.4 below.

8.2 Reinvestment and Shareholding Structure of HoldCo.

8.2.1 Pursuant to:

(i) the Deed of Undertaking and the subscription agreement to be entered into

between the Offeror, HoldCo and GLT, GLT will agree to reinvest an agreed

amount from the proceeds arising from the sale of his Innovalues Shares

pursuant to the Scheme, to subscribe for a certain number of new HoldCo

Shares, based on the Issue Price; and

(ii) the Deed of Undertaking and the subscription agreement to be entered into

between the Offeror, HoldCo and SP, SP will agree to reinvest an agreed

amount from the proceeds arising from the sale of his Innovalues Shares

pursuant to the Scheme, to subscribe for a certain number of new HoldCo

Shares, based on the Issue Price,

(the “Reinvestments”).

8.2.2 Following completion of the Scheme and the Reinvestments (“Completion”), the

shareholding structure of HoldCo, subject to the finalised debt/equity capital structure

of HoldCo, is envisaged to be as follows:

(i) Founding Shareholder: between 60.8 to 63.2 per cent.;

(ii) GLT: approximately 23.9 per cent.;

(iii) SP: approximately 1.6 per cent.; and

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(iv) other Innovalues Shareholders who elect the Cash and Securities

Consideration (including KBH and OTB): between 11.4 to 13.8 per cent.

8.3 Shareholder Arrangements. Following Completion, the relationship between GLT and the

Founding Shareholder will be governed by a shareholders’ agreement to set out their

agreement in relation to the affairs of HoldCo (the “Shareholders’ Agreement”). The

Shareholders’ Agreement will contain provisions such as those relating to board appointment

rights, reserved matters which will require the approval of GLT, and call option rights of GLT

and/or the Founding Shareholder in relation to HoldCo Shares held by the Management

Personnel (as defined below). GLT will have to bear the risks associated with the business

and financial performance of HoldCo and its subsidiaries going forward and will have to

accept the restricted rights of a minority shareholder in a privately held company.

8.4 Management Equity Arrangements. To encourage members of the management team of

the Innovalues Group (including GLT and SP) (collectively, the “Management Personnel”) to

continue to render their services to the Innovalues Group, HoldCo will establish a

management equity incentive plan (the “Management Equity Arrangements”) after

Completion, to grant the Management Personnel remaining in the employment of the

Innovalues Group options to subscribe for HoldCo Shares upon meeting certain conditions

and/or targets.

8.5 SIC Confirmations. Pursuant to the Application, the SIC has confirmed that the Deeds of

Undertaking given by GLT and SP, and the proposed arrangements contemplated by the

Term Sheet relating to GLT and SP (including the Reinvestments, Shareholders’ Agreement

and the Management Equity Arrangements) do not constitute special deals under Rule 10 of

the Code, subject to the IFA (as defined below) publicly stating that in its opinion such

arrangements are fair and reasonable.

9. RATIONALE FOR THE ACQUISITION

9.1 Rationale for the Offeror. The Acquisition represents an opportunity for the Offeror to

acquire control of a company in the precision manufacturing sector with a regional

manufacturing footprint.

9.2 Opportunity for Innovalues Shareholders to Realise their Investment. The Acquisition

represents an opportunity for Innovalues Shareholders to realise their investments in the

Company for a cash consideration at a premium over the one-month volume weighted

average prices (“VWAP”) of the Innovalues Shares prior to the last trading day immediately

before 7 April 2016 (being the date on which the Company released the announcement in

respect of a possible transaction) (the “Holding Announcement Date”).

10. FINANCIAL EVALUATION OF THE SCHEME CONSIDERATION

The Scheme Consideration for each Innovalues Share is either (i) the Cash Consideration,

being S$1.01 in cash, or (ii) the Cash and Securities Consideration, which has an implied

value (based on the Issue Price) equal to the Cash Consideration.

The figures set out in this paragraph are based on data extracted from Bloomberg as at 25

October 2016, being the last full trading day immediately prior to the Joint Announcement

Date.

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The implied premium of the Scheme Consideration over the relevant closing prices and

VWAP of the Company is as follows:

Innovalues Share

Price

Premium to Innovalues

Share Price

(S$) (%)

12-month VWAP to 6 April 2016

(1) 0.774 30.5%

6-month VWAP to 6 April 2016

(1) 0.790 27.9%

3-month VWAP to 6 April 2016(1)

0.830 21.6%

1-month VWAP to 6 April 2016(1)

0.849 19.0%

Closing price on 6 April 2016(1)

0.890 13.5%

Closing price on 30 September

2016(2)

0.855 18.1%

Closing price on 25 October 2016(3)

0.980 3.1%

Notes:

(1) Being the last trading day immediately prior to the Holding Announcement Date.

(2) Being the last full trading day immediately prior to 2 October 2016, being the date on which the Company

released the announcement to update the Innovalues Shareholders that discussions on the possible

transaction are still on-going. (3) Being the last full trading day immediately prior to the Joint Announcement Date.

11. APPROVALS REQUIRED

11.1 Scheme Meeting and Court Sanction. The Scheme will require, inter alia, the following

approvals:

11.1.1 the approval of the Scheme by a majority in number of Innovalues Shareholders

representing not less than three-fourths in value of the Innovalues Shares held by

Innovalues Shareholders present and voting either in person or by proxy at the

Scheme Meeting; and

11.1.2 the sanction of the Scheme by the Court.

In addition, the Scheme will only come into effect if all the Scheme Conditions have been

satisfied or, as the case may be, waived in accordance with the Implementation Agreement

and a copy of the order of the Court sanctioning the Scheme has been lodged with the

Accounting and Corporate Regulatory Authority of Singapore (“ACRA”).

11.2 SIC Confirmations. Pursuant to the Application, the SIC has confirmed, inter alia, that:

11.2.1 it has no objections to the Adjustment Mechanism;

11.2.2 the Scheme is exempted from complying with Rules 14, 15, 16, 17, 20.1, 21, 22, 28,

29, 33.2 and Note 1(b) on Rule 19 of the Code, subject to the following conditions:

13

(i) the Offeror, HoldCo and/or their concert parties abstain from voting on the

Scheme;

(ii) the common substantial shareholders of the Offeror, HoldCo, the Founding

Shareholder and their concert parties and the Company, if any, abstain from

voting on the Scheme;

(iii) Northstar and its concert parties abstain from voting on the Scheme;

(iv) the directors of the Company who are also directors of the Offeror and its

concert parties, if any, abstain from making a recommendation on the

Scheme to the Innovalues Shareholders;

(v) the Company appoints an independent financial adviser to advise the

Innovalues Shareholders on the Scheme; and

(vi) the Scheme Document containing advice to the effect that by voting for the

Scheme, the Innovalues Shareholders are agreeing to Northstar and its

concert parties acquiring or consolidating effective control in the Company

without having to make a general offer for the Company; and

(vii) the Scheme Document discloses the names of Northstar and its concert

parties, their current voting rights in the Company as of the latest practicable

date in relation to the Scheme Document and their voting rights in the

Company after the Scheme; and

11.2.3 it has no objections to the Scheme Conditions.

12. CONFIRMATION OF FINANCIAL RESOURCES

Standard Chartered Bank, being the financial adviser to the Offeror in connection with the

Acquisition and the Scheme, confirms that sufficient financial resources are available to the

Offeror to satisfy in full the aggregate Scheme Consideration payable by the Offeror for all the

Innovalues Shares to be acquired by the Offeror pursuant to the Scheme (excluding the

amount to be reinvested under the Reinvestments), on the basis that all Innovalues

Shareholders (other than KBH and OTB) elect to receive the Cash Consideration and KBH

and OTB elect to receive the Cash and Securities Consideration.

13. FINANCIAL ADVISERS

13.1 Financial Adviser to the Company. Rippledot Capital Advisers Pte. Ltd. is the financial

adviser to the Company in respect of the Acquisition and the Scheme.

13.2 Financial Adviser to the Offeror. Standard Chartered Bank (the “Offeror Financial

Adviser”) is the financial adviser to the Offeror in respect of the Acquisition and the Scheme.

13.3 Independent Financial Adviser to the Independent Directors. Provenance Capital Pte.

Ltd. has been appointed as the independent financial adviser (the “IFA”) to advise the

directors of the Company who are considered to be independent for the purposes of the

14

Scheme (collectively, the “Independent Directors”) for the purposes of making a

recommendation to the Innovalues Shareholders in connection with the Scheme. Full details

of the Scheme including the recommendation of the Independent Directors along with the

advice of the IFA (the “IFA Letter”) will be included in the Scheme Document.

14. SCHEME DOCUMENT

14.1 Scheme Document. The Scheme Document containing full details of the Scheme (including

the recommendation of the Independent Directors along with the IFA Letter) and giving notice

of the Scheme Meeting to approve the Scheme will be despatched to Innovalues

Shareholders in due course.

Innovalues Shareholders are advised to refrain from taking any action in relation to their

Innovalues Shares which may be prejudicial to their interests until they or their advisers have

considered the information and the recommendations of the Independent Directors on the

Scheme as well as the advice of the IFA set out in the Scheme Document.

Persons who are in doubt as to the action they should take should consult their

stockbroker, bank manager, solicitor or other professional advisers.

15. DISCLOSURE OF INTERESTS

15.1 Company. As at the Joint Announcement Date, the interests in Innovalues Shares held by

the directors of the Company are set out below:

Directors

Direct Interest Deemed Interest

No. of

Innovalues

Shares

%(1)

No. of

Innovalues

Shares

%(1)

Mr Goh Leng Tse 68,726,000

20.95%

886,000(2)

0.27%

Mr Pung Tong Seng 3,191,000

0.97%

1,797,000(3)

0.55%

Mr Ong Tiak Beng 31,376,000

9.56%

–

–

Mr Anthony Teo Soon Chye 699,000

0.21%

–

–

Mr Liew Yoke Pheng, Joseph 249,000

0.076%

–

–

Notes:

(1) All references to percentage shareholding of the issued share capital of the Company in this paragraph

15.1 of this Joint Announcement are based on the total issued Innovalues Shares as at the date of this

Joint Announcement.

(2) Mr Goh Leng Tse is deemed to have an interest in the Innovalues Shares held by Lai Yim Moy.

15

(3) Mr Pung Tong Seng is deemed to have an interest in the 1,752,000 Innovalues Shares held through DBS

Vickers Securities (Singapore) Pte Ltd and the 45,000 Innovalues Shares held by his spouse.

Save as disclosed in this Joint Announcement, no Director or controlling Innovalues

Shareholder of the Company has any interest in the Scheme (other than by reason only of

being a Director or Innovalues Shareholder of the Company). As disclosed in this Joint

Announcement, the Undertaking Shareholders have given the Deeds of Undertaking.

15.2 Offeror

15.2.1 No Holdings. As at the Joint Announcement Date, none of (A) the Offeror, HoldCo,

the Founding Shareholder and Northstar, (B) the directors of the Offeror and HoldCo,

and (C) the Offeror Financial Adviser, (collectively, the “Relevant Persons”) owns,

controls or has agreed to acquire any:

(i) (a) Innovalues Shares, (b) securities which carry voting rights in the

Company and (c) convertible securities, warrants, options or derivatives in

respect of such Innovalues Shares or securities which carry voting rights in

the Company (collectively, the “Innovalues Securities”); or

(ii) (a) HoldCo Shares (save as disclosed in paragraph 2.2), (b) securities which

carry voting rights in HoldCo and (c) convertible securities, warrants, options

or derivatives in respect of such HoldCo Shares or securities which carry

voting rights in HoldCo.

15.2.2 Security Arrangements. The Innovalues Shares acquired by the Offeror pursuant to

the Acquisition will be charged in favour of Standard Chartered Bank (Hong Kong)

Limited as security for, inter alia, the financing arrangements for the Acquisition. Save

for the foregoing, neither the Offeror nor the other Relevant Persons has (i) granted a

security interest relating to any Innovalues Securities to another person, whether

through a charge, pledge or otherwise, (ii) borrowed any Innovalues Securities from

another person (excluding borrowed Innovalues Securities which have been on-lent

or sold) or (iii) lent any Innovalues Securities to another person.

15.2.3 Confidentiality. In the interests of confidentiality, save for the Relevant Persons, the

Offeror has not made enquiries in respect of certain other parties who are or may be

deemed to be acting in concert with it in connection with the Scheme. Similarly, in the

interests of confidentiality, the Offeror Financial Adviser has not made any enquiries

in respect of the other members of its group. Further enquiries will be made of such

persons subsequent to this Joint Announcement and the relevant disclosures will be

made in due course and in the Scheme Document.

16. OVERSEAS SHAREHOLDERS

The applicability of the Scheme to Innovalues Shareholders whose addresses are outside

Singapore, as shown on the Register of Members of the Company, or as the case may be, in

the records of The Central Depository (Pte) Limited (each, an “Overseas Innovalues

Shareholder”) may be affected by the laws of the relevant overseas jurisdictions.

Accordingly, all Overseas Innovalues Shareholders should inform themselves about, and

observe, any applicable legal requirements in their own jurisdictions.

16

Where there are potential restrictions on sending the Scheme Document to any overseas

jurisdiction, the Offeror reserves the right not to send such documents to the Innovalues

Shareholders in such overseas jurisdiction. For the avoidance of doubt, the Scheme is being

proposed to all Innovalues Shareholders (including the Overseas Innovalues Shareholders),

including those to whom the Scheme Document will not be, or may not be, sent, provided that

the Scheme Document does not constitute an offer or a solicitation to any person in any

jurisdiction in which such offer or solicitation is unlawful and the Scheme is not being

proposed in any jurisdiction in which the introduction or implementation of the Scheme would

not be in compliance with the laws of such jurisdiction.

Overseas Innovalues Shareholders who are in doubt about their positions should

consult their own professional advisers in the relevant jurisdictions.

Further details in relation to Overseas Innovalues Shareholders will be contained in the

Scheme Document.

17. DOCUMENTS FOR INSPECTION

Copies of the Implementation Agreement and the Deeds of Undertaking will be made

available for inspection during normal business hours at the registered office of the Company

from the Joint Announcement Date up until the Effective Date.

18. RESPONSIBILITY STATEMENTS

18.1 Company. The directors of the Company (including any who may have delegated detailed

supervision of the preparation of this Joint Announcement) have taken all reasonable care to

ensure that the facts stated and all opinions expressed in this Joint Announcement which

relate to the Company (excluding information relating to the Offeror, HoldCo and/or Northstar

or any opinion expressed by the Offeror, HoldCo and/or Northstar) are fair and accurate and

that, where appropriate, no material facts which relate to the Company have been omitted

from this Joint Announcement, and the directors of the Company jointly and severally accept

responsibility accordingly.

Where any information which relates to the Company has been extracted or reproduced from

published or otherwise publicly available sources or obtained from the Offeror, HoldCo or

Northstar, the sole responsibility of the directors of the Company has been to ensure that,

through reasonable enquiries, such information is accurately extracted from such sources or,

as the case may be, reflected or reproduced in this Joint Announcement. The directors of the

Company do not accept any responsibility for any information relating to the Offeror, HoldCo

and/or Northstar or any opinion expressed by the Offeror, HoldCo and/or Northstar.

18.2 Offeror and HoldCo. The directors of the Offeror and HoldCo (including any who may have

delegated detailed supervision of the preparation of this Joint Announcement) have taken all

reasonable care to ensure that the facts stated and all opinions expressed in this Joint

Announcement (excluding information relating to the Company or any opinion expressed by

the Company) are fair and accurate and that, where appropriate, no material facts in relation

thereto have been omitted from this Joint Announcement, and the directors of the Offeror and

HoldCo jointly and severally accept responsibility accordingly.

17

Where any information has been extracted or reproduced from published or otherwise publicly

available sources or obtained from the Company, the sole responsibility of the directors of the

Offeror and HoldCo has been to ensure that, through reasonable enquiries, such information

is accurately extracted from such sources or, as the case may be, reflected or reproduced in

this Joint Announcement. The directors of the Offeror and HoldCo do not accept any

responsibility for any information relating to or any opinion expressed by the Company.

26 October 2016

By order of the Board

By order of the board of directors

INNOVALUES LIMITED PRECISION SOLUTIONS LIMITED

Any queries relating to this Joint Announcement, the Acquisition or the Scheme should be directed to

one of the following:

Innovalues Limited

Rippledot Capital Advisers Pte. Ltd.

6 Battery Road #19-02A

Singapore 049909

Attn: Atin Kukreja / Ravi Ravulaparthi

Tel: +65 6226 0788

Precision Solutions Limited

Standard Chartered Bank

8 Marina Boulevard

Marina Bay Financial Centre Tower 1

Singapore 018981

Attn: Ralf Pilarczyk / Samaresh Singh

Tel: +65 6596 9495

Forward-Looking Statements

All statements other than statements of historical facts included in this Joint Announcement are or

may be forward-looking statements. Forward-looking statements include but are not limited to those

using words such as “seek”, “expect”, “anticipate”, “estimate”, “believe”, “intend”, “project”, “plan”,

“strategy”, “forecast” and similar expressions or future or conditional verbs such as “will”, “would”,

“should”, “could”, “may” and “might”. These statements reflect the Offeror’s or the Company's (as the

case may be) current expectations, beliefs, hopes, intentions or strategies regarding the future and

assumptions in light of currently available information. Such forward-looking statements are not

guarantees of future performance or events and involve known and unknown risks and uncertainties.

Accordingly, actual results may differ materially from those described in such forward-looking

statements. Innovalues Shareholders and investors of the Offeror and the Company should not place

undue reliance on such forward-looking statements, and neither the Offeror nor the Company

undertakes any obligation to update publicly or revise any forward-looking statements.

18

Schedule 1

Scheme Conditions

All capitalised terms used and not defined in this Joint Announcement shall have the same meanings

given to them in the Implementation Agreement, a copy of which is available for inspection during

normal business hours at the registered office of the Company from the Joint Announcement Date up

until the Effective Date.

The Acquisition is conditional upon the following:

1. Regulatory Approvals: prior to the first application to the Court for the order to convene the

Scheme Meeting, the receipt of the following Regulatory Approvals and such approvals not

being revoked or withdrawn (if applicable) on or before the Relevant Date:

(i) confirmation from the SIC that Rules 14, 15, 16, 17, 20.1, 21, 22, 28, 29 and 33.2 and

Note 1(b) to Rule 19 of the Code do not apply to the Scheme, subject to any

conditions that the SIC may deem fit to impose;

(ii) confirmation from the SIC that it has no objections to the conditions set out in this

Schedule 1;

(iii) approval-in-principle of the SGX-ST of the Scheme Document and for the proposed

delisting of Innovalues from the SGX-ST; and

(iv) subject to any conditions that the SIC may deem fit to impose, confirmation from the

SIC that (A) the proposed arrangements contemplated in the binding term sheet

dated 25 October 2016 between Northstar and GLT, including the management

incentive plan for the Management Personnel who are Innovalues Shareholders,

would not be regarded as a prohibited special deal under the Code; and (B) each of

the Undertaking Shareholders (including GLT) giving the Irrevocable Undertakings

would be permitted to attend and vote on the Scheme at the Scheme Meeting;

2. Authorisations: In addition to the approvals aforementioned in paragraph 1 above:

(i) in relation to Innovalues (and in addition to the approvals and steps referred to in

paragraphs 5, 6 and 7 below) all other authorisations, consents, clearances,

permissions and approvals as are necessary or required by Innovalues under any

and all applicable laws from all relevant Government Agencies, for or in respect of the

Acquisition or the implementation of the Scheme being obtained; and

(ii) in relation to each of the Offeror and HoldCo, all authorisations, consents, clearances,

permissions and approvals as are necessary or required by the Offeror and/or

HoldCo under any and all applicable laws from all Governmental Agencies, for or in

respect of the Acquisition or implementation of the Scheme being obtained,

and if any such authorisations, consents, clearances, permissions and approvals is subject to

any conditions or requires any actions or obligations to be taken or performed, all such

actions having been duly taken or performed on or prior to the first application to the Court for

the order to convene the Scheme Meeting;

19

3. Major Customers: the receipt of all authorisations, consents, clearances, permissions and

approvals as are necessary or required by Innovalues from the Major Customers (as defined

below), for or in respect of the implementation of the Scheme and/or the Acquisition;

4. Relevant Facilities: (i) the receipt of all authorisations, consents, clearances, permissions and

approvals as are necessary or required by Innovalues from the counterparties to the Relevant

Facilities for or in respect of the implementation of the Scheme and/or the Acquisition and/or (ii)

the repayment of all outstanding amounts under the Relevant Facilities and termination of the

Relevant Facilities;

5. Shareholder Approval: the approval of the Scheme by the Innovalues Shareholders at the

Scheme Meeting to approve the Scheme in compliance with Section 210(3AB) of the

Companies Act;

6. Court Order: the grant of the Court Order by the Court and such Court Order having become

final;

7. Lodgement of the Court Order: the lodgement of the Court Order with ACRA pursuant to

Section 210(5) of the Companies Act;

8. No Legal or Regulatory Restraint: between the date of the Implementation Agreement and up

to the Relevant Date, no injunction or other order being issued by any Governmental Agency or

by any court of competent jurisdiction or other legal or regulatory restraint, prohibition or

condition preventing the consummation of the Acquisition or the implementation of the Scheme

or proposed transactions relating to the Scheme, being in effect;

9. No Prescribed Occurrence: between the date of the Implementation Agreement and up to the

Relevant Date, no Prescribed Occurrence in relation to Innovalues (or, where applicable, any

other Innovalues Group Company) or the Offeror (or, where applicable, HoldCo), as the case

may be, occurring other than as required or contemplated by the Implementation Agreement;

10. The Offeror's and HoldCo’s Representations, Warranties and Covenants:

(i) the representations and warranties of the Offeror and HoldCo set out in the

Implementation Agreement that:

(A) are qualified as to materiality, the Fundamental Acquiror Warranties and the

Fundamental HoldCo Warranties shall be true and correct; and

(B) are not qualified as to materiality (other than the Fundamental Acquiror

Warranties and the Fundamental HoldCo Warranties) shall be true and

correct in all material respects,

in each case as of the date of the Implementation Agreement and as of the Relevant

Date (as if they have been given again on and as of that date) except to the extent

any such representation or warranty expressly relates to an earlier date (in which

case as of such earlier date); and

20

(ii) each of the Offeror and HoldCo shall have, as of the Relevant Date, performed and

complied in all material respects with all covenants and agreements contained in the

Implementation Agreement which are required to be performed by or complied with

by it, on or prior to the Relevant Date;

11. Innovalues' Representations, Warranties and Covenants:

(i) the representations and warranties of Innovalues set out in the Implementation

Agreement that:

(A) are qualified as to materiality and the Fundamental Innovalues Warranties

shall be true and correct; and

(B) are not qualified as to materiality (other than the Fundamental Innovalues

Warranties) shall be true and correct in all material respects,

in each case as of the date of the Implementation Agreement and as of the Relevant

Date (as if they have been given again on and as of that date) except to the extent

any such representation or warranty expressly relates to an earlier date (in which

case as of such earlier date); and

(ii) Innovalues shall have, as of the Relevant Date, performed and complied in all

material respects with all covenants and agreements contained in the Implementation

Agreement which are required to be performed by or complied with by it, on or prior to

the Relevant Date;

12. Irrevocable Undertakings: contemporaneous with the execution of the Implementation

Agreement, each of the Undertaking Shareholders delivering to the Offeror the relevant

Irrevocable Undertakings in the agreed terms;

13. Material Adverse Event: there being no event occurring from the date of the Implementation

Agreement which has or have the effect of causing a diminution in the consolidated net tangible

asset value of Innovalues Group to an amount below S$73,000,000, as reflected in or

computed from the later of (i) the latest publicly released consolidated unaudited financial

statement of Innovalues Group immediately prior to the Relevant Date; or (ii) the consolidated

unaudited management balance sheet (to be prepared in accordance with the accounting

principles, policies, bases, practices and estimation techniques used in preparing the

Innovalues June 2016 Unaudited Accounts applied on a consistent basis) as at the calendar

month ending at least fifteen (15) days immediately prior to the Relevant Date, provided that

any diminution or increase in the value of any asset or liability arising from currency translation

shall not be taken into account. For the avoidance of doubt, the consolidated net tangible asset

value of Innovalues Group shall mean net assets excluding intangible assets, goodwill and

minority interests; and

14. Major Customers: between the date of the Implementation Agreement and the Relevant Date,

there being no loss of any Major Customer or any written notice given by any Major Customer

indicating that it wishes to cease being a customer of the Innovalues Group. For the purpose of

the Implementation Agreement, a "Major Customer" refers to a major customer that had,

together with such customer’s contract manufacturers, contributed (in aggregate) 5 per cent. or

more to the gross revenue of the Innovalues Group as disclosed and reflected in the Innovalues

21

2015 Audited Accounts. For the avoidance of doubt, an individual contract manufacturer is not

deemed to be a Major Customer for the purposes of the Implementation Agreement.

22

Schedule 2

Prescribed Occurrence

For the purposes of the Implementation Agreement, a “Prescribed Occurrence”, as referred to in

paragraphs 4.2.1 and 4.2.2 of the Joint Announcement and paragraph 9 of Schedule 1 to this Joint

Announcement and defined in the Implementation Agreement, means, in relation to the Offeror,

HoldCo, Innovalues and/or any other Innovalues Group Company, as the case may be, any of the

following:

1. Conversion of Shares: Innovalues converting all or any of its shares into a larger or smaller

number of shares;

2. Share Buy-back: Innovalues entering into a share buy-back agreement or resolving to

approve the terms of a share buy-back agreement under the Companies Act or the equivalent

companies or securities legislation;

3. Reduction of Share Capital: Innovalues resolving to reduce its share capital in any way;

4. Allotment of Shares: Innovalues making an allotment of, or granting an option to subscribe

for, any shares or securities convertible into shares or agreeing to make such an allotment or

to grant such an option or convertible security, or any other Innovalues Group Company doing

any of the foregoing with respect to its own securities, other than in the case of Innovalues, an

issue of shares pursuant to the valid exercise of an existing Option in accordance with the

terms of the Share Option Scheme;

5. Issuance of Debt Securities: Innovalues (or any other Innovalues Group Company), issuing,

or agreeing to issue, convertible notes or other debt securities;

6. Dividends: Innovalues declaring, making or paying any dividends or any other form of

distribution to its shareholders;

7. Injunctions: an injunction or other order issued by any court of competent jurisdiction or

other legal restraint or prohibition preventing the consummation of the Scheme or the

Acquisition or any part thereof by either the Offeror or Innovalues;

8. Resolution for Winding Up: Innovalues (or any other Innovalues Group Company), the

Offeror or HoldCo resolving that it be wound up;

9. Appointment of Liquidator and Judicial Manager: the appointment of a liquidator,

provisional liquidator, judicial manager, provisional judicial manager and/or other similar

officer of Innovalues (or of any other Innovalues Group Company), the Offeror or HoldCo;

10. Order of Court for Winding Up: the making of an order by a court of competent jurisdiction

for the winding up of Innovalues (or of any other Innovalues Group Company), the Offeror or

HoldCo;

23

11. Composition: Innovalues (or any other Innovalues Group Company), the Offeror or HoldCo

entering into any arrangement or general assignment or composition for the benefit of its

creditors generally;

12. Appointment of Receiver: the appointment of a receiver or a receiver and manager, in

relation to the property or assets of Innovalues (or of any other Innovalues Group Company),

the Offeror or HoldCo;

13. Insolvency: Innovalues (or any other Innovalues Group Company), the Offeror or HoldCo

becoming or being deemed by law or a court to be insolvent or stops or suspends or

threatens to stop or suspend payment of its debts;

14. Cessation of Business: Innovalues (or any other Innovalues Group Company), the Offeror

or HoldCo ceases or threatens to cease for any reason to carry on business in the usual

course;

15. Breach of the Implementation Agreement: Innovalues, the Offeror or HoldCo being in

material breach of any of the provisions of the Implementation Agreement;

16. Investigations and Proceedings: if Innovalues (or any other Innovalues Group Company),

the Offeror or HoldCo or any of their respective directors is or will be the subject of any

governmental, quasi-governmental, criminal, regulatory or stock exchange investigation

and/or proceeding; or

17. Analogous Event: any event occurs which, under the laws of any jurisdiction, has an

analogous or equivalent effect to any of the foregoing event(s).

24

Schedule 3

Specific Obligations

The Specific Obligations of the Company are as follows:

1. Announcement: Innovalues will release the Announcement jointly with the Offeror on the

Announcement Date;

2. Preparation of Scheme Document: Innovalues shall prepare and circulate the Scheme

Document and all other documents which are required to be prepared and circulated by it in

connection with the Scheme and to carry into effect the Implementation Agreement, in each

case, in compliance with all applicable laws and regulations;

3. SGX-ST Approval: Innovalues shall submit the draft Scheme Document to the SGX-ST for

clearance as soon as reasonably practicable after the date of the Implementation Agreement

and diligently seek such clearance promptly;

4. Scheme Meeting: Subject to obtaining the approval of the SGX-ST, Innovalues will make the

application to the Court for order(s) convening the Scheme Meeting and for any ancillary

orders relating thereto (all such applications and orders, including the originating summons for

the Scheme, to be in such form and substance as shall have been approved by the Offeror)

and convene the Scheme Meeting;

5. Despatch of Documents: Innovalues will instruct its share registrar to despatch to the

entitled Innovalues Shareholders the Scheme Document and the appropriate forms of proxy

for use at the Scheme Meeting following approval thereof by the SGX-ST and the Court,

respectively;

6. Major Customers: Innovalues will prepare all necessary documents to obtain the consent of

the relevant Major Customers for the waiver of the non-compliance and/or breach of the

requirements, covenants and terms in the contracts entered into with such Major Customer

which will or may occur as a result of the Acquisition and/or the Scheme;

7. Relevant Facilities: Innovalues will prepare all necessary documents to (i) obtain the

consent of the counterparties to the Relevant Facilities for the waiver of the non-compliance

and/or breach of the requirements, covenants and terms in the Relevant Facilities which will

or may occur as a result of the Acquisition and/or the Scheme, and/or (ii) repay all

outstanding amounts under the Relevant Facilities and terminate the Relevant Facilities;

8. Court Order: If the Scheme is approved by the requisite majority of the Innovalues

Shareholders at the Scheme Meeting, Innovalues will apply to the Court within such time

frames as shall be agreed between the Parties in writing for the Court Order and seek its

sanction and confirmation of the Scheme;

9. ACRA Lodgement: Following the grant of the Court Order, Innovalues will deliver the same

to ACRA for lodgement within such time frames as shall be agreed between the Parties

pursuant to Section 210(5) of the Companies Act;

25

10. No Dividend or Distribution: Innovalues will not, during the period from the date of the

Implementation Agreement up to (and including) the Effective Date:

(i) declare or pay any dividend or make any distribution (in cash or in kind) to the

Innovalues Shareholders; or

(ii) (and will procure that no Innovalues Group Company will) create, allot or issue any

shares or other securities convertible into equity securities, or create, issue or grant

any option or right to subscribe in respect of any of its share capital, or agree to do

any of the foregoing, save for the Innovalues Shares issued on or prior to the

Relevant Date pursuant to the valid exercise of existing Options in accordance with

the terms of the Share Option Scheme;

11. Normal Dealing: Innovalues will not, and will procure that each Innovalues Group Company

will not, without the prior written consent of the Offeror (such consent not to be unreasonably

withheld):

(i) except as would not be material in the context of the Innovalues Group taken as a

whole, dispose of any assets, including shares or other interests in any Innovalues

Group Company or in any other entity in which it has an interest, or voluntarily

assume, acquire or incur any liabilities (including contingent liabilities), in each case,

otherwise than in the ordinary and normal course of business of the Innovalues

Group;

(ii) create, or agree to create, any Encumbrance over any of the Innovalues Group

Company's assets or undertakings otherwise than in the ordinary and normal course

of business of the Innovalues Group;

(iii) enter into any guarantee, indemnity or other agreement to secure any obligation of a

third party that is not an Innovalues Group Company or to create any Encumbrance

over any of the Innovalues Group's assets or undertakings otherwise than in the

ordinary and usual course of business of the Innovalues Group;

(iv) enter into any transaction with any shareholder and/or director of any Innovalues

Group Company otherwise than in the ordinary and usual course of business of the

Innovalues Group;

(v) amend, or agree to amend, any terms of any agreement or arrangement to which any

Innovalues Group Company is a party or is bound by which would have a material

adverse effect on the financial position of the Innovalues Group as a whole;

(vi) sell, transfer or otherwise dispose of any treasury shares of Innovalues to any person

(other than the Offeror);

(vii) save for the banking facilities disclosed to the Offeror during the Offeror’s due

diligence process, incur further bank indebtedness (beyond the amount already

incurred) in excess of S$500,000; or

(viii) save for any issue of shares pursuant to the valid exercise of an existing Option in

accordance with the terms of the Share Option Scheme, alter its share capital in any

26

way, including (A) issuing, or granting a right or option to subscribe for, any new

shares or new class of shares, (B) repurchasing, cancelling or redeeming its share

capital or any reduction, consolidation, subdivision or reclassification or other

alteration of its capital structure; and

12. No Solicitation: During the Restricted Period, Innovalues will:

(i) ensure that it and the other Innovalues Group Companies and their respective

employees, consultants, advisers and representatives shall deal exclusively with the

Offeror to complete the Scheme and do not directly or indirectly solicit, invite, induce,

initiate, encourage or entertain approaches or participate in or enter into any

negotiations or discussions, or communicate any intention to do any of these things

(including allowing any third party to perform due diligence investigations on any

Innovalues Group Company), with a view to obtaining or with respect to any

expression of interest, offer or proposal by any person other than the Offeror in

relation to:

(A) any proposal or offer to (whether directly or indirectly) acquire or become the

holder (whether by share purchase, asset purchase, scheme, capital

reconstruction, tender offer or otherwise) of, or otherwise have an economic

interest in:

(I) any part of the businesses, assets (other than in the ordinary and

usual course of business of the Innovalues Group) or undertakings of

Innovalues and/or any other Innovalues Group Company; or

(II) any shares in Innovalues and/or any other Innovalues Group

Company; or

(B) any proposal or offer to otherwise acquire or merge with Innovalues or any

other Innovalues Group Company (whether by way of joint venture, reverse

takeover bid, dual listed company structure or otherwise); or

(C) any other arrangement having an effect similar to any of items 12(i)(A) or

12(i)(B), including a merger or amalgamation proposal; or

(D) any other transaction which would preclude, interfere with or prejudice the

Acquisition and/or the Scheme;

(ii) notify the Offeror of the details of any approach or solicitations by any third party

made in writing either to Innovalues or any Innovalues Group Company with a view to

the making of any such offer, merger or sale upon becoming aware of the relevant

matter,

save that the restrictions in this item 12 shall not apply to (I) the making of normal

presentations, by and on behalf of any Innovalues Group Company, to brokers, portfolio

investors and analysis in the ordinary and usual course in relation to its business generally,

and (II) the provision of information by or on behalf of Innovalues to the SGX-ST.

For the avoidance of doubt, nothing in this item 12 shall prohibit or restrict Innovalues from

receiving any unsolicited or uninitiated expression of interest, offer or proposal of a kind

27

referred to in this item 12. In the event that any Innovalues Group Company receives any

such expression of interest, offer or proposal, Innovalues shall be entitled:

(1) if required pursuant to the Listing Rules and/or the Code, to announce such

expression of interest, offer or proposal;

(2) to enter into discussions or negotiations or otherwise entertain such expressions of

interest, offer or proposal;

(3) to make any recommendation or to refrain from making any recommendation to the

Innovalues Shareholders as the directors of Innovalues may deem fit in respect of

such expression of interest, offer or proposal; and

(4) generally to perform all such acts as may be necessary for the directors of Innovalues

to comply with and discharge their fiduciary duties, statutory, regulatory and/or legal

obligations that they may be subject to under all applicable laws and regulations

(including but not limited to their obligations under the Code),

provided that, in each instance, the Board has determined in good faith and acting reasonably

(after having obtained written advice from its legal advisers) that a failure to do any of the

foregoing would constitute a breach of the Listing Rules, the requirements of the SGX-ST, the

Code or any applicable laws or regulations (including the fiduciary obligations of the directors

of Innovalues). The Offeror, HoldCo and Innovalues agree that nothing in the Implementation

Agreement will derogate from, or otherwise affect, Innovalues’ obligations under Clause

6.2(n) of the Implementation Agreement; and

13. Appeal Process: If the Court refuses to make any orders convening the Scheme Meeting or

approving the Scheme, Innovalues must appeal the Court's decision under Singapore law

(except to the extent that the Parties agree otherwise) and the Offeror, HoldCo and

Innovalues shall consult with each other in relation to such an appeal. If an appeal of the

Courts decision is made by Innovalues, the Offeror shall provide all reasonable assistance as

Innovalues and its advisers may reasonably request for the purposes of the appeal. The legal

costs and other costs and expenses incurred by Innovalues in connection with obtaining the

orders of the Court and (if applicable) the appeal shall be borne by Innovalues.

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Schedule 4

Undertaking Shareholders

Name of

Undertaking

Shareholder

Description

Total Number of

Innovalues Shares

Owned Legally and/or

Beneficially

Number of

Innovalues Shares

Owned Legally

and/or

Beneficially as a

Percentage of the

Total Number of

Innovalues Shares

GLT Chief Executive Officer and

Director of Innovalues

68,726,000 20.95%

SP Executive Director of

Innovalues

4,943,000 1.51%

OTB Non-Executive Director of

Innovalues

31,376,000 9.56%

KBH Substantial shareholder of

Innovalues

22,000,000 6.71%

TOTAL 127,045,000 38.73%