VERTEX TECHNOLOGY ACQUISITION CORPORATION LTD

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CIRCULAR DATED 9 NOVEMBER 2023. THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. PLEASE READ IT CAREFULLY.

ÀǘƵǞȁǏȌȲǿƊɈǞȌȁǞȁɈǘǞȺǐƊɈƵǏȌǶƮǞȺƊȺɐǿǿƊȲɯȌǏɈǘƵ§ȲȌȯȌȺƵƮ ɐȺǞȁƵȺȺ!ȌǿƦǞȁƊɈǞȌȁƊȁƮǞȺȱɐƊǶǞ˛ƵƮƦɯ‫ة‬ƊȁƮȺǘȌɐǶƮƦƵȲƵƊƮǞȁƧȌȁǯɐȁƧɈǞȌȁɩǞɈǘ‫ة‬ɈǘƵǏɐǶǶǞȁǏȌȲǿƊɈǞȌȁƧȌȁɈƊǞȁƵƮǞȁɈǘƵȲƵȺɈȌǏɈǘǞȺ!ǞȲƧɐǶƊȲ‫خ‬XȁɈǘƵƵɨƵȁɈȌǏƊȁɯǞȁƧȌȁȺǞȺɈƵȁƧɯȌȲƧȌȁ˜ǞƧɈƦƵɈɩƵƵȁɈǘƵǞȁǏȌȲǿƊɈǞȌȁǞȁɈǘǞȺǐƊɈƵǏȌǶƮƊȁƮɈǘǞȺ!ǞȲƧɐǶƊȲ‫ة‬ɈǘƵ
information set out in this Circular shall prevail.

VERTEX TECHNOLOGY ACQUISITION CORPORATION LTD(Incorporated as an exempted company in the Cayman Islands)(Company Registration No. 378671)
XIæÇª0Xyyæ(Ç À²ÀÀR0!ÀXyÀRÀæÇ²RÇm(Àj0‫ة‬æÇ²RÇm(!y²ÇmÀæÇªm0Jm‫ة‬
IXyy!Xm‫ة‬ÀåªÀR0ª§ªI0²²Xym(ßX²0ª‫ـ‬²‫ف‬Xww0(XÀ0mæ‫خ‬ÇȁǶƵȺȺȌɈǘƵȲɩǞȺƵƮƵ˛ȁƵƮ‫ة‬ƧƊȯǞɈƊǶǞȺƵƮɈƵȲǿȺƊȯȯƵƊȲǞȁǐǞȁɈǘǞȺǐƊɈƵǏȌǶƮƦƵƊȲɈǘƵȺƊǿƵǿƵƊȁǞȁǐȺƊȺƮƵ˛ȁƵƮǞȁ
this Circular.
If you have sold or transferred all your shares (the “Shares٘‫ ف‬Ǟȁ ßƵȲɈƵɮ ÀƵƧǘȁȌǶȌǐɯ ƧȱɐǞȺǞɈǞȌȁ !ȌȲȯȌȲƊɈǞȌȁ mɈƮ(“VTAC” or the “Company٘‫ف‬ǘƵǶƮɈǘȲȌɐǐǘÀǘƵ!ƵȁɈȲƊǶ(ƵȯȌȺǞɈȌȲɯ‫§ـ‬ɈƵ‫ف‬mǞǿǞɈƵƮ‫ـ‬ɈǘƵٗCDP٘‫ةف‬ɯȌɐȁƵƵƮȁȌɈǏȌȲɩƊȲƮɈǘǞȺ!ǞȲƧɐǶƊȲɈȌɈǘƵȯɐȲƧǘƊȺƵȲȌȲɈȲƊȁȺǏƵȲƵƵƊȺƊȲȲƊȁǐƵǿƵȁɈȺɩǞǶǶƦƵǿƊƮƵƦɯ!(§ǏȌȲƊȺƵȯƊȲƊɈƵ!ǞȲƧɐǶƊȲɈȌƦƵȺƵȁɈto the purchaser or transferee.
ȁ ƊȯȯǶǞƧƊɈǞȌȁ ǘƊȺ ƦƵƵȁ ǿƊƮƵ ɈȌ ɈǘƵ ²ǞȁǐƊȯȌȲƵ 0ɮƧǘƊȁǐƵ ²ƵƧɐȲǞɈǞƵȺ ÀȲƊƮǞȁǐ mǞǿǞɈƵƮ ‫ـ‬ɈǘƵ ٗSGX-ST” or the“Exchange”) for permission for the listing and quotation of the Consideration Shares, the Earnout Shares, the0X²²ǘƊȲƵȺ‫ة‬ɈǘƵ0²§²ǘƊȲƵȺƊȁƮɈǘƵ²ȯƵƧǞƊǶ ȌȁɐȺ²ǘƊȲƵȺȌȁɈǘƵwƊǞȁƦȌƊȲƮ‫خ‬ÀǘƵǶǞȺɈǞȁǐƊȁƮȱɐȌɈƊɈǞȌȁȁȌɈǞƧƵ‫ة‬ǞǏǞȺȺɐƵƮƦɯɈǘƵ²Jåٌ²À‫ة‬ǞȺȁȌɈɈȌƦƵɈƊǲƵȁƊȺƊȁǞȁƮǞƧƊɈǞȌȁȌǏɈǘƵǿƵȲǞɈȺȌǏƊȁɯȌǏɈǘƵ§ȲȌȯȌȺƵƮÀȲƊȁȺƊƧɈǞȌȁȺ‫ـ‬ƊȺƮƵ˛ȁƵƮ ǘƵȲƵǞȁ‫ ةف‬ɈǘƵ !ȌǿȯƊȁɯ‫ ة‬ɈǘƵ ÀƊȲǐƵɈ JȲȌɐȯ ‫ـ‬ƊȺ ƮƵ˛ȁƵƮ ǘƵȲƵǞȁ‫ ةف‬ɈǘƵ 0ȁǶƊȲǐƵƮ JȲȌɐȯ ‫ـ‬ƊȺ ƮƵ˛ȁƵƮ ǘƵȲƵǞȁ‫ةف‬ɈǘƵ!ȌȁȺǞƮƵȲƊɈǞȌȁ²ǘƊȲƵȺ‫ة‬ɈǘƵ0ƊȲȁȌɐɈ²ǘƊȲƵȺ‫ة‬ɈǘƵ0X²²ǘƊȲƵȺ‫ة‬ɈǘƵ0²§²ǘƊȲƵȺȌȲɈǘƵ²ȯƵƧǞƊǶ ȌȁɐȺ²ǘƊȲƵȺ‫خ‬ÀǘƵ
²Jåٌ²ÀǘƊȺȁȌɈǞȁƊȁɯɩƊɯƧȌȁȺǞƮƵȲƵƮɈǘƵǿƵȲǞɈȺȌǏɈǘƵȺǘƊȲƵȺƦƵǞȁǐȌǏǏƵȲƵƮǏȌȲǞȁɨƵȺɈǿƵȁɈ‫خ‬ÀǘƵ²Jåٌ²ÀƊȺȺɐǿƵȺȁȌȲƵȺȯȌȁȺǞƦǞǶǞɈɯǏȌȲɈǘƵƊƧƧɐȲƊƧɯȌǏƊȁɯȌǏɈǘƵȺɈƊɈƵǿƵȁɈȺǿƊƮƵ‫ة‬ȲƵȯȌȲɈȺƧȌȁɈƊǞȁƵƮȌȲȌȯǞȁǞȌȁȺƵɮȯȲƵȺȺƵƮ‫ة‬ǞȁɈǘǞȺ
Circular.
Special Considerations for Shareholders Who Are U.S. Persons
Neither the U.S. Securities and Exchange Commission (“SEC” or “Commission”) nor any state securities
administrator has approved or disapproved the securities offered in this Circular nor has the Commission or any
state securities administrator passed upon the adequacy or accuracy of the disclosures contained in this Circularor the merits of an investment in the securities offered herein. Any representation to the contrary is a criminalȌǏǏƵȁƧƵɐȁƮƵȲɈǘƵǶƊɩȺȌǏɈǘƵÇ‫خ‬²‫خ‬yȌȁƵ ȌǏ ɈǘƵ ȺƵƧɐȲǞɈǞƵȺ ɈȌ ɩǘǞƧǘ ɈǘǞȺ !ǞȲƧɐǶƊȲ ȲƵǶƊɈƵȺ ǘƊɨƵ ƦƵƵȁ ȲƵǐǞȺɈƵȲƵƮ ɐȁƮƵȲ ɈǘƵ Ç‫خ‬²‫ خ‬²ƵƧɐȲǞɈǞƵȺ ƧɈ ȌǏ ׁ‫׃׃׉‬(the “1933 Act٘‫ةف‬ȌȲƊȁɯÇ‫خ‬²‫خ‬ȺɈƊɈƵȺƵƧɐȲǞɈǞƵȺǶƊɩȺ‫ة‬ƊȁƮ‫ة‬ɐȁǶƵȺȺȺȌȲƵǐǞȺɈƵȲƵƮ‫ة‬ȁȌȁƵǿƊɯƦƵȌǏǏƵȲƵƮ‫ة‬ȺȌǶƮ‫ة‬ȯǶƵƮǐƵƮȌȲȌɈǘƵȲɩǞȺƵɈȲƊȁȺǏƵȲȲƵƮ‫ة‬ƮǞȲƵƧɈǶɯȌȲǞȁƮǞȲƵƧɈǶɯ‫ة‬ǞȁɈǘƵÇ‫خ‬²‫ةخ‬ȌȲɈȌ‫ة‬ȌȲǏȌȲɈǘƵƊƧƧȌɐȁɈȌȲƦƵȁƵ˛ɈȌǏ‫ة‬Ç‫خ‬²‫§خ‬ƵȲȺȌȁȺ‫ة‬ƵɮƧƵȯɈǞȁƊƧƧȌȲƮƊȁƧƵɩǞɈǘɈǘƵȯȲȌɨǞȺǞȌȁȺȌǏȲƵǐɐǶƊɈǞȌȁȺɐȁƮƵȲɈǘƵׁ‫׃׃׉‬ƧɈ‫ة‬ȯɐȲȺɐƊȁɈɈȌƊȁƵǏǏƵƧɈǞɨƵȲƵǐǞȺɈȲƊɈǞȌȁȺɈƊɈƵǿƵȁɈɐȁƮƵȲɈǘƵׁ‫׃׃׉‬ƧɈ‫ة‬ȌȲȯɐȲȺɐƊȁɈɈȌƊȁƊɨƊǞǶƊƦǶƵƵɮƵǿȯɈǞȌȁǏȲȌǿ‫ة‬ȌȲǞȁƊɈȲƊȁȺƊƧɈǞȌȁȁȌɈȺɐƦǯƵƧɈɈȌ‫ة‬ɈǘƵȲƵǐǞȺɈȲƊɈǞȌȁȲƵȱɐǞȲƵǿƵȁɈȺȌǏɈǘƵׁ‫׃׃׉‬ƧɈƊȁƮǞȁƵƊƧǘƧƊȺƵȌȁǶɯǞȁƊƧƧȌȲƮƊȁƧƵɩǞɈǘƊȯȯǶǞƧƊƦǶƵÇ‫خ‬²‫خ‬ȺɈƊɈƵƊȁƮǏȌȲƵǞǐȁȺƵƧɐȲǞɈǞƵȺǶƊɩȺ‫خ‬ÀǘƵɈƵȲǿٗU.S. Person٘ǞȁƧǶɐƮƵȺ‫ة‬ƦɐɈǞȺȁȌɈǶǞǿǞɈƵƮɈȌ‫ـب‬Ɗ‫ف‬ƊȁɯÇ‫خ‬²‫خ‬ƧǞɈǞɹƵȁ‫ـس‬Ʀ‫ف‬ƊȁɯȁƊɈɐȲƊǶȯƵȲȺȌȁȲƵȺǞƮƵȁɈǞȁɈǘƵÇ‫خ‬²‫ـسخ‬Ƨ‫ف‬ƊȁɯȯƊȲɈȁƵȲȺǘǞȯȌȲƧȌȲȯȌȲƊɈǞȌȁȌȲǐƊȁǞȺƵƮȌȲǞȁƧȌȲȯȌȲƊɈƵƮɐȁƮƵȲɈǘƵǶƊɩȺȌǏɈǘƵÇ‫خ‬²‫ـسخ‬Ʈ‫ف‬ƊȁɯȯƊȲɈȁƵȲȺǘǞȯȌȲ ƧȌȲȯȌȲƊɈǞȌȁ ȌȲǐƊȁǞȺƵƮ ȌɐɈȺǞƮƵ ɈǘƵ Ç‫خ‬²‫ خ‬Ʀɯ Ɗ Ç‫خ‬²‫§ خ‬ƵȲȺȌȁ ȯȲǞȁƧǞȯƊǶǶɯ ǏȌȲ ɈǘƵ ȯɐȲȯȌȺƵ ȌǏ ǞȁɨƵȺɈǞȁǐ Ǟȁ ȺƵƧɐȲǞɈǞƵȺȁȌɈȲƵǐǞȺɈƵȲƵƮɐȁƮƵȲɈǘƵׁ‫׃׃׉‬ƧɈ‫ة‬ɐȁǶƵȺȺǞɈǞȺȌȲǐƊȁǞȺƵƮȌȲǞȁƧȌȲȯȌȲƊɈƵƮ‫ة‬ƊȁƮȌɩȁƵƮ‫ة‬ƦɯƊƧƧȲƵƮǞɈƵƮǞȁɨƵȺɈȌȲȺ‫ـ‬ƊȺƮƵ˛ȁƵƮǞȁªɐǶƵ‫ـׁ׀ׅ‬Ɗ‫ف‬ȌǏɈǘƵׁ‫׃׃׉‬ƧɈ‫ف‬ɩǘȌƊȲƵȁȌɈȁƊɈɐȲƊǶȯƵȲȺȌȁȺ‫ة‬ƵȺɈƊɈƵȺȌȲɈȲɐȺɈȺ‫س‬ȌȲ‫ـ‬Ƶ‫ف‬ƊȁɯƵȺɈƊɈƵȌȲɈȲɐȺɈȌǏɩǘǞƧǘƊȁɯƵɮƵƧɐɈȌȲȌȲƊƮǿǞȁǞȺɈȲƊɈȌȲȌȲɈȲɐȺɈƵƵǞȺƊÇ‫خ‬²‫§خ‬ƵȲȺȌȁ‫خ‬yȌɈǏȌȲȲƵǶƵƊȺƵ‫ة‬ȯɐƦǶǞƧƊɈǞȌȁȌȲƮǞȺɈȲǞƦɐɈǞȌȁ‫ة‬ǞȁɩǘȌǶƵȌȲǞȁȯƊȲɈ‫ة‬ǞȁɈȌȌȲǏȲȌǿƊȁɯǯɐȲǞȺƮǞƧɈǞȌȁɩǘƵȲƵɈȌƮȌȺȌɩȌɐǶƮƧȌȁȺɈǞɈɐɈƵƊɨǞȌǶƊɈǞȌȁȌǏɈǘƵȲƵǶƵɨƊȁɈǶƊɩȺȌǏɈǘƊɈǯɐȲǞȺƮǞƧɈǞȌȁ‫خ‬
YOUR ATTENTION IS DRAWN TO SECTION 16 TITLED “RISK FACTORS” OF THIS CIRCULAR, WHICHHIGHLIGHTS CERTAIN MATERIAL RISKS RELATING TO THE OWNERSHIP OF THE SHARES AND INHERENTIN THE BUSINESS OF THE TARGET GROUP. SHAREHOLDERS ARE ADVISED TO TAKE THESE FACTORS INTOCONSIDERATION WHEN DECIDING ON THE PROPOSED TRANSACTIONS.

Important Dates and Times
Last date and time to purchase Shares to be entitledto the Special Bonus NRS Shares and the Additional
Warrants
Last date and time to purchase Shares to be entitled to
the Redemption Right

27 November 2023, before the closeof trading at 5.00 p.m.

Commencement of the Trading Suspension

28 November 2023, 9.00 a.m.

Last date and time to elect for Redemption and submit
the Share Redemption Form

28 November 2023, 2.00 p.m.

Last date and time for lodgement of Proxy Form

29 November 2023, 2.00 p.m.

Date and time of Extraordinary General Meeting andannouncement of level of Redemption

1 December 2023, 2.00 p.m.

Place of Extraordinary General Meeting

Circular to Shareholders in relation to the:ׁ‫خ‬§ȲȌȯȌȺƵƮɐȺǞȁƵȺȺ !ȌǿƦǞȁƊɈǞȌȁ ƦƵɈɩƵƵȁ ɈǘƵ!ȌǿȯƊȁɯƊȁƮׁ‫ׇ‬mXß0XȁƧ‫خ‬ƦɯɩƊɯȌǏƊȁƊƧȱɐǞȺǞɈǞȌȁƦɯ
the Company of the entire issued and paid-up shareƧƊȯǞɈƊǶȌǏׁ‫ׇ‬mXß0XȁƧ‫خ‬ǏȲȌǿɈǘƵßƵȁƮȌȲǏȌȲɈǘƵ§ɐȲƧǘƊȺƵ!ȌȁȺǞƮƵȲƊɈǞȌȁ‫س‬ׂ‫§ خ‬ȲȌȯȌȺƵƮ ƊǶǶȌɈǿƵȁɈ ƊȁƮ ǞȺȺɐƊȁƧƵ ȌǏ ׁ‫ׁׅ׆ةׂ׆ׁة׀׆‬!ȌȁȺǞƮƵȲƊɈǞȌȁ ²ǘƊȲƵȺ ƊɈ ɈǘƵ XȺȺɐƵ §ȲǞƧƵ ȌǏ ²‫ ׀׀خׅٽ‬ǞȁȯƊȲɈǞƊǶ ȺƊɈǞȺǏƊƧɈǞȌȁ ȌǏ ɈǘƵ §ɐȲƧǘƊȺƵ !ȌȁȺǞƮƵȲƊɈǞȌȁ ǏȌȲɈǘƵ§ȲȌȯȌȺƵƮ ɐȺǞȁƵȺȺ!ȌǿƦǞȁƊɈǞȌȁ‫س‬‫§ خ׃‬ȲȌȯȌȺƵƮƊǶǶȌɈǿƵȁɈƊȁƮǞȺȺɐƊȁƧƵȌǏɐȯɈȌׂׄ‫׀׀׀ة׈׀ׄة‬0ƊȲȁȌɐɈ ²ǘƊȲƵȺ ƊɈ ɈǘƵ XȺȺɐƵ §ȲǞƧƵ ȌǏ ²‫ ׀׀خׅٽ‬ɈȌ ɈǘƵ
Earnout Shareholders in partial satisfaction of the§ɐȲƧǘƊȺƵ !ȌȁȺǞƮƵȲƊɈǞȌȁ ǏȌȲ ɈǘƵ §ȲȌȯȌȺƵƮ ɐȺǞȁƵȺȺ!ȌǿƦǞȁƊɈǞȌȁ‫ ة‬ȺɐƦǯƵƧɈ ɈȌ ɈǘƵ ȺƊɈǞȺǏƊƧɈǞȌȁ ȌǏ ɈǘƵIǞȁƊȁƧǞƊǶÀƊȲǐƵɈȺǏȌȲ0ƊȲȁȌɐɈ‫س‬ׄ‫§ خ‬ȲȌȯȌȺƵƮƊǶǶȌɈǿƵȁɈƊȁƮǞȺȺɐƊȁƧƵȌǏɐȯɈȌׂ‫׀׀׀ة׀׀׀ة‬ƊȺƵ §X§0 ²ǘƊȲƵȺ ƊɈ ɈǘƵ XȺȺɐƵ §ȲǞƧƵ ȌǏ ²‫ ׀׀خׅٽ‬ɈȌ ɈǘƵ
§X§0XȁɨƵȺɈȌȲȺ‫س‬‫§ خׅ‬ȲȌȯȌȺƵƮ ƊǶǶȌɈǿƵȁɈ ƊȁƮ ǞȺȺɐƊȁƧƵ ȌǏ ɐȯ ɈȌ ‫׀׀׆ة׀׆ׇة׃‬²ȯƵƧǞƊǶ ȌȁɐȺ ²ǘƊȲƵȺ ƊɈ ɈǘƵ XȺȺɐƵ §ȲǞƧƵ ȌǏ ²‫ ׀׀خׅٽ‬ɈȌɈǘƵ yȌȁٌªƵƮƵƵǿǞȁǐ ²ǘƊȲƵǘȌǶƮƵȲȺ ƊȁƮ ɈǘƵ §X§0XȁɨƵȺɈȌȲȺ‫س‬‫§ خ׆‬ȲȌȯȌȺƵƮƊƮȌȯɈǞȌȁȌǏɈǘƵ0ɮƵƧɐɈǞɨƵXȁƧƵȁɈǞɨƵ²ƧǘƵǿƵ‫س‬‫§ خׇ‬ȲȌȯȌȺƵƮ ƊǶǶȌɈǿƵȁɈ ƊȁƮ ǞȺȺɐƊȁƧƵ ȌǏ ɐȯ ɈȌ ׂ‫׀׀׀ة׀ׅׅة‬0X² ²ǘƊȲƵȺ ƊɈ ɈǘƵ XȺȺɐƵ §ȲǞƧƵ ȌǏ ²‫ ׀׀خׅٽ‬ɈȌ ɈǘƵ jƵɯ0ɮƵƧɐɈǞɨƵȺ‫ة‬ȺɐƦǯƵƧɈɈȌɈǘƵȺƊɈǞȺǏƊƧɈǞȌȁȌǏɈǘƵIǞȁƊȁƧǞƊǶÀƊȲǐƵɈȺǏȌȲ0X²‫س‬‫§ خ׈‬ȲȌȯȌȺƵƮ ƊƮȌȯɈǞȌȁ ȌǏ ɈǘƵ !ȌǿȯƊȁɯ 0ǿȯǶȌɯƵƵ ²ǘƊȲƵȯɈǞȌȁ§ǶƊȁ‫س‬‫§ خ׉‬ȲȌȯȌȺƵƮ ƊǶǶȌɈǿƵȁɈ ƊȁƮ ǞȺȺɐƊȁƧƵ ȌǏ ɐȯ ɈȌ ׂ‫ׁ׉׈ةׁׁׄة‬0²§ ²ǘƊȲƵȺ ȯɐȲȺɐƊȁɈ ɈȌ ɈǘƵ !ȌǿȯƊȁɯ 0ǿȯǶȌɯƵƵ
²ǘƊȲƵȯɈǞȌȁ§ǶƊȁ‫س‬ׁ‫§ خ׀‬ȲȌȯȌȺƵƮ ƧǘƊȁǐƵ ȌǏ ɈǘƵ !ȌǿȯƊȁɯٚȺ ȁƊǿƵ ɈȌ ׁٗ‫ׇ‬mXß0JȲȌɐȯmǞǿǞɈƵƮ٘‫س‬ׁׁ‫§ خ‬ȲȌȯȌȺƵƮ ƊƮȌȯɈǞȌȁ ȌǏ ɈǘƵ yƵɩ wƵǿȌȲƊȁƮɐǿ ƊȁƮȲɈǞƧǶƵȺȌǏȺȺȌƧǞƊɈǞȌȁ‫س‬ׁׂ‫§ خ‬ȲȌȯȌȺƵƮ ƧǘƊȁǐƵ ȌǏ ɈǘƵ !ȌǿȯƊȁɯٚȺ XȁƮƵȯƵȁƮƵȁɈɐƮǞɈȌȲ‫س‬ׁ‫§ خ׃‬ȲȌȯȌȺƵƮƊȯȯȌǞȁɈǿƵȁɈȌǏwȲ‫§خ‬ǘɐƊhǞƵɮǞƊȁhȌȺƵȯǘƊȺƊȁƵɩ(ǞȲƵƧɈȌȲɐȯȌȁ!ȌǿȯǶƵɈǞȌȁ‫س‬ׁׄ‫§ خ‬ȲȌȯȌȺƵƮƊȯȯȌǞȁɈǿƵȁɈȌǏwȲ‫خ‬mǞƵȁ!ǘǞƵȁٌmǞȁƊȺƊȁƵɩ(ǞȲƵƧɈȌȲɐȯȌȁ!ȌǿȯǶƵɈǞȌȁ‫س‬ׁ‫§ خׅ‬ȲȌȯȌȺƵƮ ƊȯȯȌǞȁɈǿƵȁɈ ȌǏ wȲ‫ خ‬ǲǞȌ ÀƊȁƊǲƊ ƊȺ Ɗ ȁƵɩ(ǞȲƵƧɈȌȲɐȯȌȁ!ȌǿȯǶƵɈǞȌȁ‫س‬ׁ‫§ خ׆‬ȲȌȯȌȺƵƮƊȯȯȌǞȁɈǿƵȁɈȌǏwȲ‫خ‬RǞƮƵɈȌwǞɹɐȁȌƊȺƊȁƵɩ(ǞȲƵƧɈȌȲɐȯȌȁ!ȌǿȯǶƵɈǞȌȁ‫س‬ƊȁƮׁ‫§ خׇ‬ȲȌȯȌȺƵƮ ƊȯȯȌǞȁɈǿƵȁɈ ȌǏ wȺ‫! خ‬ǘƵȁ åǞɐǶǞȁǐ ƊȺ Ɗ ȁƵɩDirector upon Completion.

This Circular (together with the Notice of EGM,
Proxy Form, Share Redemption Form, Request
Form and the Shareholder Letter) may also beaccessed at the following URLs:

SGX:ǘɈɈȯȺ‫ششب‬ɩɩɩ‫خ‬Ⱥǐɮ‫خ‬ƧȌǿ‫ش‬ȺƵƧɐȲǞɈǞƵȺ‫ش‬company-announcements
VTACǘɈɈȯȺ‫ششب‬ɩɩɩ‫خ‬ɨƵȲɈƵɮȺȯƊƧ‫خ‬ƧȌǿ‫ش‬
announcements
Sole Issue Manager:ªƊǏ˜ƵȺ!ǞɈɯ!ȌȁɨƵȁɈǞȌȁ!ƵȁɈȲƵ‫ة‬
Level 4, Bras Basah Room, 80 Bras
Basah Road, Singapore 189560!ȲƵƮǞɈ ²ɐǞȺȺƵ ‫ـ‬²ǞȁǐƊȯȌȲƵ‫ ف‬mǞǿǞɈƵƮ ‫ٗـ‬Credit Suisse٘‫ ف‬ƊȁƮ ( ² Ɗȁǲ mɈƮ‫ٗـ خ‬DBS٘‫ ف‬ɩƵȲƵ ɈǘƵ ǯȌǞȁɈ ǞȺȺɐƵ ǿƊȁƊǐƵȲȺ ǏȌȲßƵȲɈƵɮÀƵƧǘȁȌǶȌǐɯƧȱɐǞȺǞɈǞȌȁ!ȌȲȯȌȲƊɈǞȌȁmɈƮٚȺǞȁǞɈǞƊǶȯɐƦǶǞƧȌǏǏƵȲǞȁǐ‫ـ‬ɈǘƵٗOffering٘‫!خف‬ȲƵƮǞɈ²ɐǞȺȺƵ‫ (ة‬²ƊȁƮwȌȲǐƊȁ²ɈƊȁǶƵɯ ȺǞƊ ‫ـ‬²ǞȁǐƊȯȌȲƵ‫§ ف‬ɈƵ‫ خ‬ɩƵȲƵ ɈǘƵ ǯȌǞȁɈ ǐǶȌƦƊǶ ƧȌȌȲƮǞȁƊɈȌȲȺ‫ ة‬ǯȌǞȁɈ ƦȌȌǲȲɐȁȁƵȲȺ ƊȁƮ ǯȌǞȁɈ ɐȁƮƵȲɩȲǞɈƵȲȺ ǏȌȲ ɈǘƵOffering.

Joint Financial Advisers:

Rationale for the Proposed
Business CombinationXȁ ɈǘƵ §ȲȌȺȯƵƧɈɐȺ‫ ة‬ßÀ! ǘƊƮ ƮǞȺƧǶȌȺƵƮ ɈǘƊɈ ǞɈ ǞȁɈƵȁƮȺ ɈȌ ƊƧȱɐǞȲƵ ȌȁƵ ȌȲ ǿȌȲƵƦɐȺǞȁƵȺȺƵȺ ɈǘƊɈ ǿƊɯ ƮǞȺȯǶƊɯ ɈǘƵ ǏȌǶǶȌɩǞȁǐ ƧǘƊȲƊƧɈƵȲǞȺɈǞƧȺ ‫ـ‬ƊǿȌȁǐ ȌɈǘƵȲȺ‫بف‬ׁ‫ف‬ɈƵƧǘȁȌǶȌǐɯٌƮȲǞɨƵȁƦɐȺǞȁƵȺȺƵȺ‫فׂس‬ǏƊȺɈٌǐȲȌɩǞȁǐȺƧƊǶƊƦǶƵƦɐȺǞȁƵȺȺƵȺ‫ف׃س‬ƦɐȺǞȁƵȺȺƵȺƊɈ Ɗȁ Ǟȁ˜ƵƧɈǞȌȁ ȯȌǞȁɈ‫ فׄ س‬ȺɈȲȌȁǐ ǿƊȁƊǐƵǿƵȁɈ ɈƵƊǿȺ‫ فׅ س‬ƧȲȌȺȺٌƦȌȲƮƵȲ ȯȌɈƵȁɈǞƊǶɩǞɈǘǿƊȲǲƵɈǶƵƊƮƵȲȺǘǞȯ‫س‬ƊȁƮ‫ف׆‬ƊȯȯȲȌȯȲǞƊɈƵɨƊǶɐƊɈǞȌȁ‫خ‬ȁׂƧɈȌƦƵȲׂ‫ة׃ׂ׀‬ßÀ!ƊȁȁȌɐȁƧƵƮɈǘƊɈǞɈǘƊƮƵȁɈƵȲƵƮǞȁɈȌƊ²ƊǶƵƊȁƮ§ɐȲƧǘƊȺƵǐȲƵƵǿƵȁɈɩǞɈǘׁ‫ׇ‬mXß0RȌǶƮǞȁǐmǞǿǞɈƵƮ‫ـ‬ɈǘƵٗVendor”) and certain other partiesȺƵɈǏȌȲɈǘɈǘƵȲƵǞȁǞȁȲƵǶƊɈǞȌȁɈȌɈǘƵȯȲȌȯȌȺƵƮƦɐȺǞȁƵȺȺƧȌǿƦǞȁƊɈǞȌȁƦƵɈɩƵƵȁɈǘƵ!ȌǿȯƊȁɯƊȁƮׁ‫ׇ‬mXß0XȁƧ‫ٗـخ‬17LIVE Cayman” or the “Target Company٘‫ف‬ƦɯɩƊɯȌǏƊȁƊƧȱɐǞȺǞɈǞȌȁƦɯßÀ!ȌǏɈǘƵƵȁɈǞȲƵǞȺȺɐƵƮƊȁƮȯƊǞƮٌɐȯȺǘƊȲƵƧƊȯǞɈƊǶȌǏɈǘƵÀƊȲǐƵɈ!ȌǿȯƊȁɯ‫ـ‬ɈǘƵٗProposed Business Combination”).
ÀǘƵ§ȲȌȯȌȺƵƮ ɐȺǞȁƵȺȺ!ȌǿƦǞȁƊɈǞȌȁɩǞǶǶǐǞɨƵ²ǘƊȲƵǘȌǶƮƵȲȺɈǘƵȌȯȯȌȲɈɐȁǞɈɯɈȌȯƊȲɈǞƧǞȯƊɈƵǞȁɈǘƵǐȲȌɩɈǘƊȁƮƵɮȯƊȁȺǞȌȁȌǏɈǘƵÀƊȲǐƵɈ!ȌǿȯƊȁɯ‫خ‬The top pure-play live streaming
platform (by revenue)
in Japan and Taiwan combined1ƮǯɐȺɈƵƮ0 XÀ(ȯȌȺǞɈǞɨƵsince FY2020:mƊȲǐƵɐȺƵȲƦƊȺƵ
Avg 1H FY2023mƊȲǐƵǶǞɨƵȺɈȲƵƊǿƵȲƦƊȺƵ
as of 30 June 2023

Revenue
FY2022Adjusted EBITDA
FY2022Total
MAU

Contracted
Streamers

US$363.7

US$15.9

Approximately

Approximately

550k

87k

millionmillionNo. 1 in Japanand Taiwan
combined1
U.S.

Top
MarketShare byRevenue1 of

20.8%
Japan

Taiwan

Malaysia

Philippines

26.9%

jƵɯǿƊȲǲƵɈȺȌǏ
operations include
Japan and Taiwan,ɩǞɈǘƊȯȲƵȺƵȁƧƵin Hong Kong,
Singapore, the U.S.,
the Philippines,
Malaysia and India

Market Shareby Revenue1

SingaporeCore markets

Other markets

1
Based on the report titled “Independent Market Research on the Media and Entertainment Industry
with a Focus on the Interactive Video Streaming Platform, V-Liver, and Live Commerce Industries” datedׂ‫׃‬ƧɈȌƦƵȲׂ‫׃ׂ׀‬ȯȲƵȯƊȲƵƮƦɯIȲȌȺɈ‫ۋ‬²ɐǶǶǞɨƊȁ‫ـ‬²ǞȁǐƊȯȌȲƵ‫§ف‬ɈƵmɈƮǏȌȲɈǘƵÀƊȲǐƵɈ!ȌǿȯƊȁɯKey Value
Propositions

LeadingLive Streaming
Ecosystem in Japanand Taiwan

Loyal andEngaged Live
Social Community
Driven by SeamlessȁǶǞȁƵƊȁƮǏ˜ǞȁƵExperience(ǞɨƵȲȺǞ˛ƵƮƊȁƮ
High Quality
Content

StrongLive Streamer
Community
Empowered by theTarget Group’s
End-To-End TalentManagement
Capabilities(ǞɨƵȲȺǞ˛ƵƮ
Growth Drivers
Empowering
Sustainable
Organic Growth

Leading
Technology
Capabilities with
Innovative Technology
and Superior
Safety Record

ScalableBusiness Modelwith Sustainable
Growth and§ȲȌ˛ɈƊƦǞǶǞɈɯ

VisionaryManagementwith anEntrepreneurial
Company Culture

Business
Overview
CORE OFFERINGS
17LIVE has fostered a diverse live streaming ecosystem with a loyal and engaged user community through:(ǞɨƵȲȺǞ˛ƵƮǶǞɨƵȺɈȲƵƊǿǞȁǐƧȌȁɈƵȁɈȌǏǏƵȲǞȁǐȺǞȁƧǶɐƮǞȁǐǶȌƧƊǶǞȺƵƮƧȌȁɈƵȁɈƊȁƮ
exclusive premium content across a wide range of categories

1

DIVERSIFIED CONTENT OFFERINGS

Music

Games

Education

FashionArt

LOCALISED CONTENT

Chatting

Handcrafting Fortune
Telling

Lifestyle

EXCLUSIVE PREMIUM CONTENT

Local Entertainment
VeteransC
Celebrityl b itLive Streaming

Local Top Stars1

2

Cooking

In-House Developed Shows

XǿǿƵȲȺǞɨƵȌȁǶǞȁƵƊȁƮȌǏ˜ǞȁƵƵɮȯƵȲǞƵȁƧƵȺǏȌȲǐƵƊɨǞƦȲƊȁɈƊȁƮǶȌɯƊǶ
live social community
ONLINEOFFLINELEADERBOARD

EVENT BANNEROFFLINE FINALES

Online event marketingand online competitions
1

Image Credit: Kaohsiung 17LIVE Steelers Facebook

Establish
Strong Online
Entertainment Community

Immersive
Entertainment
ExperiencewɐǶɈǞȯǶƵ ȌǏ˜ǞȁƵ ƵɨƵȁɈȺwɐǶɈǞȯǶƵȌǏ˜ǞȁƵƵɨƵȁɈȺto engage users

BUSINESS PROSPECTS

ExpandingLive Entertainment
Ecosystem(ǞɨƵȲȺǞ˛ƵƮ
Growth Drivers
17LIVE leverages its core
live streaming business toǐƵȁƵȲƊɈƵ ȯȲȌ˛ɈȺ ƊȁƮ ƧƊȺǘ˜ȌɩȺ ƊȁƮ ƮȲǞɨƵ ǐȲȌɩɈǘ
initiatives including V-Liver,live commerce and in-app
games

IN-APP GAMES

04

Highly synergisticwith core businessLIVE COMMERCE

03

Builds connections
between brand and users

02

V-LIVER034
0
02

Enables real-time interaction
with virtual characters

CORE LIVE STREAMING
Robust foundation forgrowth initiatives

01

Multiple Monetisation Strategies
17LIVE’s multi-channel monetisation model includes virtual gifting and subscription
to both live streamers and V-Livers, as well as sale of in-game virtual items

Buy virtual points

mXß0²Àª0w0ª²ٕß٬mXß0ª²
mXß0ß

Send gifts
to show
appreciation

Revenue
shareLIVE STREAMING(GIFTING)

Revenueshare

Buy goods

USERS

LIVE
COMMERCEGAMES

Purchase in-game virtual items

Select Key Growth Drivers(Xß0ª²XIX0(JªàÀR(ªXß0ª²‫ب‬ßّmXß0ª
V-Liver
Opportunity1

Organic
V-Livers

Strong growth momentum
in V-Liver business2

Japan(by total revenue US$mn)

MURAYUKI
Self-grown organic V-Liversince Nov 2018

Rapidly growing
V-Liver community

3,865

~2k

Average
V-LiverMAS

YoY
increase

Expanding
17LIVE fan community

Approx.
41.2%

Proprietary
V-Liver IPs

2023ِ27F
CAGR

BUSHILIVE
5 proprietary V-Liver IPs
introduced in Jul 2023

973

~75k

Average
V-Liver
MAU

2027F

2.1x

YoY
increase

Rapid growth of
V-Liver engagement

~30k

2023

6.5x

Average
V-Liver
spenders

2.7x

YoY
increase

Based on the report titled “Independent Market Research on the Media and Entertainment Industry with a Focus on the Interactive Video Streaming Platform,
V-Liver, and Live Commerce Industries” dated 23 October 2023 prepared by Frost & Sullivan (Singapore) Pte Ltd for the Target Company
2
For 2Q 2023
1

Since 2015, 17LIVE has built a strong foundation of live streaming
operations which serves as a base for new growth initiatives

V-LIVER

Expand pool of quality
V-Livers through active
conversion of the Target
Group’s live streamer
community and partnerships
with or acquisition oftalent agencies

Promote V-Livers bypartnering with top V-Livers
agencies in Japan to invite
their V-Livers to participate
in online competitionsƊȁƮȌǏ˜ǞȁƵƵɨƵȁɈȺCollaborate with gamecompanies in Japan tofeature their V-Livers, which
expands the user base andmonetisation channels

Acquired more than 80
V-Liver IPs of which over 60
V-Livers have started
live streaming

STRATEGIC EXPANSION
INTO REGIONAL
MARKETS WITH HIGHGROWTH POTENTIAL

Japan

Taiwan

Malaysia

Philippines

ThailandSingapore

The market size for live streaming in Southeast Asia is
expected to increase from US$1,071.8 million in 2023 to
US$2,160.9 million in 2027, representing a moderated CAGR
of approximately 19.2% (from 2023-2027F). Southeast Asia isseen to be a fast-growing live streaming market. The Target
Group plans to expand its business in Southeast Asia by:Indonesia‫ ۀ‬0Ǐ˛ƧǞƵȁɈǶɯɐɈǞǶǞȺǞȁǐǞɈȺƊɨƊǞǶƊƦǶƵƧȌȁɈƵȁɈɈȌƦɐǞǶƮƊƧȲǞɈǞƧƊǶǿƊȺȺȌǏɐȺƵȲȺǞȁ²ȌɐɈǘƵƊȺɈȺǞƊ‫ة‬ɩǞɈǘƊɨǞƵɩɈȌƊƧǘǞƵɨǞȁǐorganic growth through cross-border activities and the export of Japanese and Taiwanese content andmerchandise to Southeast Asia through a combination of live streaming, its live commerce channels and 17Shop‫ ۀ‬Making its Japan V-Liver content available in other countries once the Japan V-Liver offering reaches a more
more mature stage‫ ۀ‬Acquiring more live streamers and users in Southeast Asia to complement and strengthen 17LIVE’s core
live streaming business and reach a larger audience base in these markets by collaborating or
partnering with media and entertainment companies in Southeast Asia

Estimated Market Size of Interactive Video
Streaming in Southeast Asia1(US$mn)2,160.9

.2%
9
1
R:
F)

646.0

7
02
2
ِ
23
0
2
(

G
CA

356.2

1,071.8

274.8

349.9

265.5

148.9
142.3
141.5

618.4

289.2
2023
Indonesia
1

2027F
Malaysia

Singapore

Philippines

ThailandBased on the report titled “Independent Market Research on the Media and Entertainment Industry with a Focus on the Interactive Video Streaming Platform,
V-Liver, and Live Commerce Industries” dated 23 October 2023 prepared by Frost & Sullivan (Singapore) Pte Ltd for the Target Company

Key Operational and
Financial Highlights
KEY OPERATING METRICS‫ن‬wyÀRmæß0ªJ0IªׁRIæׂ‫ه׃ׂ׀‬MONTHLY
ACTIVE USERS١wÇ٢

SPENDERS AS A
PERCENTAGE OF MAU
١²§0y(ªÀ0٢

AVERAGE REVENUEPER SPENDING USER
١ª§§Ç٢

16.1%

US$302

Approximately

550,000

ADJUSTED EBITDA1 POSITIVESINCE FY2020
33.3

8.1%

17.4

3.5%

10.4%
15.9

4.4%

15.7

2.2%
4.4

FY2020

FY2021

Adjusted EBITDA (US$mn)

1

FY2022

1H2022Adjusted EBITDA Margin

Adjusted EBITDA (US$mn)

1H2023

The Target Group defines EBITDA as operating income before depreciation and Adjusted EBITDA as EBITDA net of share-based payment
and amortisation.

Key Terms of the
Proposed Business Combination
SUBJECT TO SHAREHOLDERS’ APPROVALPURCHASE CONSIDERATION:
UP TO S$922.9mn
Consideration Shares

S$800.8mn

Earnout Shares
up to

S$122.0mn(Subject to the Financial Targets
for Earnout being achieved)

TOTAL EQUITY VALUE OF ENLARGED GROUP POST COMPLETION:
UP TO S$996.9mn٬²‫עىפנלلלژ‬mn
Purchase
Consideration

Escrow
Amount1

PIPE
Financing

up to
S$922.9mn

S$60.0mn S$208.0mn

S$10.0mn

Shares to be
Allotted and Issued

Special Bonus
Scheme2

S$4.0mn S$18.8mn

Overview

Consideration Shares‫ ۀ‬The Company shall allot and issue 160,162,651 new Shares at S$5.00 per Share in partial
satisfaction of the Purchase Consideration (calculated based on the pre-money equity
value of the Target Company of S$800.8 million)

Earnout Shares‫ ۀ‬The Company shall allot and issue up to 24,408,000 new Shares at S$5.00 per Share to
Earnout Shareholders on the Earnout Vesting Dates, namely, 30 April 2024 and 30 August
2024, subject to the Financial Targets for Earnout achieved

Base PIPE Shares‫ ۀ‬The Company shall allot and issue up to 2,000,0002 new Shares at S$5.00 per Share to
the PIPE Investors pursuant to the PIPE Financing

Special Bonus Shares3‫ ۀ‬The Company shall allot and issue 0.1 new Shares to (a) the Non-Redeeming Shareholders
for every existing Share held as at the Redemption Record Date and (b) the PIPE
Investors for every Base PIPE Share subscribed for “Non-Redeeming Shareholders” refers
to existing Shareholders (other than Vertex SPV) who hold Shares as at the Redemption
Record Date and who will be entitled to the Special Bonus NRS Shares and the Additional
Warrants based on the Shares held as at the Redemption Record Date

EIS Shares‫ ۀ‬The Company shall allot and issue up to 2,550,000 new Shares at S$5.00 per Share to
the Key Executives on the EIS Vesting Dates, namely, 30 April 2024, 30 April 2025 and
30 April 2026, subject to the Financial Targets for EIS achieved

ESOP Shares‫ ۀ‬The Company shall allot and issue up to 2,114,891 new Shares in accordance with theCompany ESOP1 \«®Ú ×¦×Ú áÈ á« ÂÈäÃá ×Â ®Ã®Ã§ ®Ã á« Ú×Èø ÈäÃá ÔÈÚáɩÈÂÔ½á®ÈÃ Ď× Ô þÂÃá È¦ á« SÂÔá®ÈÃ P×®ɒ ÚÚäÂ®Ã§ á« á á«× ®Ú > ý®ÂäÂ
SÂÔá®ÈÃ ɟ®ɒɒ ½½ V« ×«È½×Ú ɟÚ ÷ ¦È× j×áý VPj Ã jÃă®Èɠ ý×®Ú á«®× SÂÔá®ÈÃ S®§«áɠɍ á« Ã½ ×§ $×ÈäÔ ø®½½ ×®÷ VɿǽǷɒǷ Â®½½®ÈÃ ¦×ÈÂ á«Ú×Èø ÈäÃáɒ ÚÚäÂ®Ã§ á« á á«× ®Ú ?È SÂÔá®ÈÃ ɟ®ɒɒ ÃÈÃ È¦ á« V« ×«È½×Ú ɟ®Ã½ä®Ã§ j×áý VPj Ã jÃă®Èɠ ý×®Ú á«®× SÂÔá®ÈÃ S®§«áɠɍá« Ã½ ×§ $×ÈäÔ ø®½½ ×®÷ VɿǹǷǿɒǷ Â®½½®ÈÃ ¦×ÈÂ á« Ú×Èø ÈäÃáɒǹ

#È× ®½½äÚá× á®÷ Ôä×ÔÈÚÚ ÈÃ½þɒ3

½½ ?ÈÃɩSÂ®Ã§ V« ×«È½×Ú ɟ®Ã½ä®Ã§ jÃă®Èɠ ø«È × ÃÈá ?ÈÃɩRä ½®¦þ®Ã§ V« ×«È½×Ú Ú á á« SÂÔá®ÈÃ SÈ×  á ø®½½  ½®§®½ ¦È×VÔ® ½ ÈÃäÚ ?SV V« ×Ú  Ú ÈÃ á« V« ×Ú á«þ «È½ á á« SÂÔá®ÈÃ SÈ×  áɒ \« Ô×ÈÔÈÚ ½½ÈáÂÃá Ã ®ÚÚä Ã È¦ á« VÔ® ½ ÈÃäÚ?SV V« ×Ú Ã ®á®ÈÃ ½ k ×× ÃáÚ ®Ú ÈÃ½þ ÷ ®½ ½ áÈ ?ÈÃɩSÂ®Ã§ V« ×«È½×Ú ɟ®Ã½ä®Ã§ jÃă®Èɠ ø«È × ÃÈá ?ÈÃɩRä ½®¦þ®Ã§ V« ×«È½×Ú Ú áá« SÂÔá®ÈÃ SÈ×  áɒ P½ Ú ×¦× áÈ Vá®ÈÃ ǻǹɒǹ á®á½ “+ÂÔÈ×á Ãá ?Èá® áÈ V« ×«È½×Ú Ã á®ÈÃÚ áÈ  \ »Ã ɨ SÂÔá®ÈÃ ɩ P×Èä×Ú ¦È×?ÈÃɩSÂ®Ã§ V« ×«È½×Ú” of this Circular for further details.

Incentives for All
Stakeholders
SUBJECT TO SHAREHOLDERS’ APPROVALINCENTIVESFor Non-Redeeming Shareholders
and PIPE InvestorsFor
Key Executives

For
Earnout Shareholders

SPECIAL BONUS
SCHEMEEXECUTIVE INCENTIVESCHEMEEARNOUTFRAMEWORK

0.1 New Shares

Up to 2,550,000 Shares

Up to 24,408,000 Shares

Subject to satisfaction of the
Financial Targets for EIS

Subject to satisfaction of
the Financial Targets
for Earnout

To: (1) Non-Redeeming Shareholders forevery existing Share held as at the
Redemption Record Date; and(2) PIPE Investors for every Base PIPE
Share subscribed forSponsor Commitment
To minimise dilution to other Shareholders of the Enlarged Group arising from the Special Bonus Scheme and the
Executive Incentive Scheme, the Sponsor will waive its pro rata right to the allotment and issuance of such numberof Promote Shares to Vertex SPV equal to the actual number of Special Bonus Shares and Executive Incentive
Shares allotted.
Post Completion of the Proposed Business Combination, the Sponsor’s shareholding will be subject to a moratorium
for a period of 12 months from the Completion Date and Venezio’s shareholding will be subject to a moratorium fora period of 6 months from the Completion Date. Please refer to Section 23.7 titled “Enlarged Group Corporate andShareholding Structure - Moratorium” of this Circular for further details.
²§y²ªm!j٬Ç§yy٬ª0(00wXyJ!wwXÀw0yÀ
SponsorVenezio

Promote Shares, Sponsor IPO Investment Units
and Private Placement Warrants

S$30mn

S$30mn12 months

OWNERSHIP STRUCTURE
The following tables set out the shareholding of the existing Shareholders of the Company and the top 10 disclosed
Shareholders of the Resulting Issuer after the Proposed Business Combination, the Proposed Allotment andIssuance of the Consideration Shares, the Proposed Allotment and Issuance of the Base PIPE Shares and the
Proposed Allotment and Issuance of Special Bonus Shares, under the two Redemption scenarios:
EXISTING SHAREHOLDERS OF THE COMPANY% Shareholding in the Resulting Issuer held by existing Shareholders

TOP 10 DISCLOSED SHAREHOLDERS OF THE RESULTING ISSUER

1
2
3
4
5
6
7
8
9
10

Xȁ˛ȁǞɈɯƵ‫خ‬ßƵȁɈɐȲƵȺȺǞƊXXX‫ة‬m‫خ§خ‬
M17 Growth SPV LLC
Dragon Alexander Limited (wholly owned by co-founder Joseph Phua)
Vertex Legacy Continuation Fund Pte. Ltd.
KTB China Synergy Fund
Vertex Growth Fund Pte. Ltd.
Venezio Investments Pte. Ltd.
Vertex Co-Investment Fund Pte. Ltd. (Vertex SPV)§ƊɨXȁɨƵȺɈǿƵȁɈȺ§ɈƵ‫خ‬mɈƮ‫ٶخ‬
Mr. Ng Jing Shen‫ن‬yª0(0w§ÀXy‫ة‬²‫׀ׁٽ‬wy§X§0‫ه‬‫ن‬wåXwÇwª0(0w§ÀXy‫ة‬²‫׀ׁٽ‬wy§X§0‫ه‬

21.8%

7.2%

DIRECT INTEREST‫ن‬yª0(0w§ÀXy‫ة‬²‫׀ׁٽ‬wy§X§0‫ه‬

DIRECT INTEREST‫ن‬wåXwÇwª0(0w§ÀXy‫ة‬²‫׀ׁٽ‬wy§X§0‫ه‬

9.4%
9.0%
7.7%
7.0%
4.5%
3.3%
3.2%
2.9%
2.8%
2.0%

11.1%
10.7%
9.2%
8.3%
5.4%
4.0%
3.8%
3.4%
3.3%
2.4%

What Do You
Need To Do?
Please refer to the Notice of EGM which contains the full list of resolutions to be passed at the EGM (including theresolution on the Proposed Business Combination).

You now have access to the Circular,
the Notice of EGM, the Proxy Form, the Share Redemption Form,the Request Form and the Letter to Shareholders(For Shareholders who wish to redeem part or all of their Shares)
Submit the Share Redemption Form by 28 November 2023, 2.00 p.m.
Please refer to Section 42.2 titled “Important Notice to Shareholders andActions to be Taken - Redemption” of this Circular for further details.

Appoint a proxy to vote at the EGM
by submitting the Proxy Form by
29 November 2023, 2.00 p.m.

Attend the EGM in person

EGM
1 December 2023, 2.00 p.m.

TWO POSSIBLE OUTCOMESOUTCOME 1

Shareholders vote in favour of the
Proposed Transactions.
The Proposed Business Combination isapproved and upon Completion,
the Resulting Issuer will trade under
the new name “17LIVE Group Limited” on
the SGX-ST on 8 December 2023 at 9.00 a.m.

OUTCOME 2
Shareholders do not vote in favour of one ormore of the Proposed Transactions.
The Proposed Business Combination is not
approved and will not be completed.
All Redemption requests will be canceled andthe Company will proceed to Liquidation.
Please refer to Section 42.2 titled“Redemption - Consequences if the Proposed
Business Combination is Not Completed”
of this Circular for further details.

Voting Instructions
If you are unable to attend the EGM in person, you may appoint someone you know, or the Chairman of the EGM,
to vote on your behalf by completing the Proxy Form.

STEP 1

Locate the Proxy Form

The Proxy Form is enclosed together with this Circular and is also available on the
SGX website at the URL: https://www.sgx.com/securities/company-announcements
and the Company’s website at the URL: https://www.vertexspac.com/announcements
SGX

STEP 2VTAC

Complete the Proxy FormVERTEX TECHNOLOGY ACQUISITION CORPORATION LTD(Company Registration Number: 378671)(Incorporated in the Cayman Islands)

EXTRAORDINARY GENERAL MEETING – DEPOSITOR PROXY FORM
We, The Central Depository (Pte) Limited, of 11 North Buona Vista Drive #06-07 The Metropolis Tower 2, Singapore 138589(“CDP”) being a member of VERTEX TECHNOLOGY ACQUISITION CORPORATION LTD (the “Company”), pursuant to
Article 23.1(b) of the Company’s Memorandum and Articles of Association, are deemed to have appointed the person whose nameand particulars are set out in Part I below (the “Depositor(s)”), in respect of such number of shares (the “Depositor(s) Shares”)
set out against his/her/its name in the depository register maintained by CDP (the “Depository Register”) on 29 November 2023
(the “Cut Off Date”), as our proxy to vote for us on our behalf at the Extraordinary General Meeting (the “EGM”) of the Company
to be held at Raffles City Convention Centre, Level 4, Bras Basah Room, 80 Bras Basah Road, Singapore 189560 on 1 December
2023 at 2 p.m. (Singapore time) and at any adjournment thereof.

A.

Fill in your name and particularsB.

æȌɐǿƊɯ˛ǶǶǞȁɈǘƵƮƵɈƊǞǶȺȌǏɈǘƵƊȯȯȌǞȁɈƵƵȌȲǶƵƊɨƵɈǘƵȲƵǶƵɨƊȁɈȺƵƧɈǞȌȁƦǶƊȁǲ‫خ‬
The Chairman of the EGM will be the appointee if the relevant section is left blank.

C.

Indicate the number of Shares you holdD.

Indicate your vote in the box labelled FOR, AGAINST or ABSTAIN

E.

XȁƮǞɨǞƮɐƊǶȺǘƊȲƵǘȌǶƮƵȲȺƊȲƵȲƵȱɐǞȲƵƮɈȌȺǞǐȁɈǘƵ§ȲȌɮɯIȌȲǿƊȁƮ˛ǶǶǞȁɈǘƵƮƊɈƵ‫خ‬
Corporate shareholders are required to either execute the Proxy Form under itsƧȌǿǿȌȁȺƵƊǶȌȲƊȲȲƊȁǐƵǏȌȲɈǘƵ§ȲȌɮɯIȌȲǿɈȌƦƵȺǞǐȁƵƮƦɯƊƮɐǶɯƊɐɈǘȌȲǞȺƵƮȌǏ˛ƧƵȲȌȲƊɈɈȌȲȁƵɯ‫ة‬ƊȁƮ˛ǶǶǞȁɈǘƵƮƊɈƵ‫خ‬I.

OR, in the event the Company receives this Depositor Proxy Form which is:–(i) duly completed and signed/executed by the Depositor(s); and(ii) submitted by the requisite time and date, and to the requisite office as indicated below,
we hereby appoint the person (“Appointee”) whose details are given in Part II(a) or failing him/her/it, the Appointee
whose details are given in Part II(b), provided that such details have been verified in Part V by the affixing of the seal or
the signature of or on behalf of the persons named in Part I, and on the basis that such person(s) is authorised to vote inrespect of the proportion of the shareholding referred to in Part II(a) or (b) or if no proportions are so reflected, in respectof the whole of the said shareholding:–
II. (a)Name

Address

Email Address

NRIC/Passport
Number

Proportion of
Shareholdings%

Numberof Shares

Address

Email Address

NRIC/Passport
Number

Proportion of
Shareholdings%

Numberof Shares

and/or (delete as appropriate)
(b)

Name

or failing him/her, the Chairman of the Meeting *as my/our proxy/proxies to vote for *me/us on *my/us on “my/our behalf at
the Extraordinary General Meeting to be convened and held at Raffles City Convention Centre, Level 4, Bras Basah Room,
80 Bras Basah Road, Singapore 189560 on 1 December 2023 at 2 p.m. (Singapore time) and at any adjournment thereof.
If no specific direction as to voting is given or in the event of any other matter arising at the EGM and at any adjournment
thereof, the proxy/proxies will vote or abstain from voting at his/her discretion. I/We further authorise and direct the Company
to accept this Depositor Proxy Form(s) in respect of the Depositor(s) Shares.
*Please delete accordingly.
III.

No. Resolutions relating toFor

AgainstAbstain

Ordinary Resolutions
1

Proposed Business Combination between the Company and 17LIVE Inc. by wayof an acquisition by the Company of the entire issued and paid-up share capitalof 17LIVE Inc. from the Vendor for the Purchase Consideration2

Proposed allotment and issuance of 160,162,651 Consideration Shares at theIssue Price of S$5.00 in partial satisfaction of the Purchase Consideration for the
Proposed Business Combination3

Proposed allotment and issuance of up to 24,408,000 Earnout Shares at the Issue
Price of S$5.00 to the Earnout Shareholders in partial satisfaction of the Purchase
Consideration for the Proposed Business Combination, subject to the satisfactionof the Financial Targets for Earnout

4

Proposed allotment and issuance of up to 2,000,000 Base PIPE Shares at theIssue Price of S$5.00 to the PIPE Investors

5

Proposed allotment and issuance of up to 3,760,600 Special Bonus Shares at theIssue Price of S$5.00 to the Non-Redeeming Shareholders and the PIPE Investors

6
7

8

Proposed adoption of the Executive Incentive Scheme
Proposed allotment and issuance of up to 2,550,000 EIS Shares at the Issue
Price of S$5.00 to the Key Executives, subject to the satisfaction of the Financial
Targets for EIS
Proposed adoption of the Company Employee Share Option Plan

9

Proposed allotment and issuance of up to 2,114,891 ESOP Shares pursuant to
the Company Employee Share Option Plan

10

Proposed Change of Company’s Independent Auditor

11

Proposed appointment of Mr. Phua Jiexian Joseph as a new Director upon Completion

12

Proposed appointment of Mr. Lien Chien-Lin as a new Director upon Completion

13

Proposed appointment of Mr. Akio Tanaka as a new Director upon Completion

14

Proposed appointment of Mr. Hideto Mizuno as a new Director upon Completion

15

Proposed appointment of Ms. Chen Xiuling as a new Director upon Completion

STEP 3

Submit the Completed Proxy Form
If submitted by post, lodge the ProxyIȌȲǿƊɈɈǘƵ²ǘƊȲƵªƵǐǞȺɈȲƊȲٚȺȌǏ˛ƧƵƊɈ
Boardroom Corporate & Advisory Services
Pte. Ltd., 1 Harbourfront Avenue, #14-07
Keppel Bay Tower, Singapore 098632

If submitted electronically, submit theProxy Form via email to the
Share Registrar, Boardroom Corporate& Advisory Services Pte. Ltd. at
srs.teamd@boardroomlimited.com

The Proxy Form must be received by the Share Registrar by 2.00 p.m. on 29 November 2023
SRS InvestorsSRS Investors may (a) vote at the EGM if they are appointed as proxies by their respective SRS Operators, and should contact
their respective SRS Operators if they have any queries regarding their appointment as proxies; or (b) specify their voting
instructions to their respective SRS Operators or arrange for their votes to be submitted with their respective SRS Operators,ƊȁƮ ȺǘȌɐǶƮ ƊȯȯȲȌƊƧǘ ɈǘƵǞȲ ȲƵȺȯƵƧɈǞɨƵ ²ª² ȯƵȲƊɈȌȲȺ ƊȺ ȺȌȌȁ ƊȺ ȯȌȺȺǞƦǶƵ ƊȁƮ Ʀɯ ɈǘƵ ɈǞǿƵ ƊȁƮ ƮƊɈƵ ƊȺ ȺȯƵƧǞ˛ƵƮ Ʀɯ ɈǘƵǞȲrespective SRS Operators to ensure their votes are submitted.
Relevant Intermediaries²ǘƊȲƵǘȌǶƮƵȲȺ ɩǘȌ ǘȌǶƮ ɈǘƵǞȲ ²ǘƊȲƵȺ ɈǘȲȌɐǐǘ Ɗ ȲƵǶƵɨƊȁɈ ǞȁɈƵȲǿƵƮǞƊȲɯ ‫ـ‬ƊȺ ƮƵ˛ȁƵƮ ɐȁƮƵȲ ²ƵƧɈǞȌȁ ׁ‫ ׁ׈‬ȌǏ ɈǘƵ ²ǞȁǐƊȯȌȲƵCompanies Act), and who wish to attend the EGM, should approach their respective relevant intermediaries through which
they hold such Shares as soon as possible in order to make the necessary arrangements for them to participate in the EGM.

Important Dates and Times1
Resumption of trading on the SGX-ST (after lifting of the Trading Suspension)

8 December 2023

Expected Redemption Payment Date and Redemption Completion Date

8 December 2023

Expected date and time of the crediting of the Consideration Shares, BasePIPE Shares and the Special Bonus PIPE Shares

8 December 2023
before market opens at 9.00 a.m.

Expected date and time of the crediting of the Special Bonus NRS Shares andthe Additional Warrants to Non-Redeeming Shareholders and the crediting of
the Additional Warrants to Vertex SPV

8 December 2023,
before market opens at 9.00 a.m.

Expected trading date under the new name “17LIVE Group Limited”

1

4 December 2023, 9.00 a.m.

Expected Completion Date

8 December 2023

 \«  áÚ Úá Èäá ®Ã á« È÷ á®Âá ½ × ®Ã® á®÷ ÈÃ½þ Ã Â þ  Úä¹á áÈ « Ã§ɒ \« ÈÂÔ Ãþ ø®½½ Â » ¦ä×á«×ÃÃÈäÃÂÃáÚ ÈÃ á« V$p?\ ÈÃ á« ý á  áÚ Ã á®ÂÚ È¦ Úä« ÷ÃáÚɒ

YOUR
VOTE
COUNTSTABLE OF CONTENTSCORPORATE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7

DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

11

GLOSSARY OF TECHNICAL TERMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

41

CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS . . . . . . . . . . . . . . . . . . .

45

INDICATIVE TIMELINE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

47

LETTER TO SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

48

1.

INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

49

2.

SUBMISSIONS TO THE SGX-ST. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

50

2.1

Approval-in-principle. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

50

2.2

Waiver from Compliance with Specific Provisions of the Mainboard Rules . .

52

SUMMARY OF THE PROPOSED TRANSACTIONS . . . . . . . . . . . . . . . . . . . . . . . . .

55

3.1

Proposed Business Combination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

55

3.2

Proposed Allotment and Issuance of the Consideration Shares . . . . . . . . . . .

57

3.3

Proposed Allotment and Issuance of the Earnout Shares . . . . . . . . . . . . . . . .

57

3.4

Proposed Allotment and Issuance of the Base PIPE Shares. . . . . . . . . . . . . .

57

3.5

Proposed Allotment and Issuance of the Special Bonus Shares . . . . . . . . . . .

58

3.6

Proposed Adoption of the Executive Incentive Scheme. . . . . . . . . . . . . . . . . .

58

3.7

Proposed Allotment and Issuance of the EIS Shares . . . . . . . . . . . . . . . . . . .

59

3.8

Proposed Adoption of the Company Employee Share Option Plan . . . . . . . . .

59

3.9

Proposed Allotment and Issuance of the ESOP Shares . . . . . . . . . . . . . . . . .

59

3.10 Proposed Change of the Company’s Name . . . . . . . . . . . . . . . . . . . . . . . . . . .

59

3.11

Proposed Adoption of the New Memorandum and Articles of Association . . .

60

3.12 Proposed Appointment of the Proposed Directors . . . . . . . . . . . . . . . . . . . . . .

60

3.13 Inter-conditionality of Resolutions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

60

RATIONALE FOR THE PROPOSED BUSINESS COMBINATION . . . . . . . . . . . . . . .

62

4.1

Requirement for the Completion of an Initial Business Combination . . . . . . . .

62

4.2

The Company’s Acquisition Mandate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

62

4.3

The Company’s Assessment of the Target Group . . . . . . . . . . . . . . . . . . . . . .

64

PROPOSED BUSINESS COMBINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

66

5.1

Purchase Consideration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

66

5.2

Earnout Framework . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

66

5.3

Special Bonus Scheme . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

68

5.4

PIPE Financing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

69

5.5

Executive Incentive Scheme . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

71

5.6

Company ESOP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

71

5.7

Sponsor’s Waiver of Promote Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

71

5.8

Valuation of the Target Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

73

5.9

Status of the Consideration Shares, the Earnout Shares, the EIS Shares, theESOP Shares, the PIPE Shares and the Special Bonus Shares . . . . . . . . . . .

75

5.10 Conditions Precedent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

75

3.

4.

5.

1

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5.11

Other Salient Terms of the SPA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

76

5.12 Shareholders’ Approval . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

76

PROPOSED ALLOTMENT AND ISSUANCE OF THE CONSIDERATIONSHARES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

77

7.

PROPOSED ALLOTMENT AND ISSUANCE OF THE EARNOUT SHARES . . . . . . .

77

8.

PROPOSED ALLOTMENT AND ISSUANCE OF THE BASE PIPE SHARES. . . . . . .

77

9.

PROPOSED ALLOTMENT AND ISSUANCE OF THE SPECIAL BONUS SHARES . .

78

10. PROPOSED ADOPTION OF THE EXECUTIVE INCENTIVE SCHEME . . . . . . . . . . .

78

10.1 Rationale for the EIS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

79

10.2 Overview of the EIS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

79

10.3 Rationale for including the Proposed Non-Executive Directors in the EIS . . .

84

10.4 Dilutive Impact of the EIS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

84

10.5 Modifications to the EIS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

84

PROPOSED ALLOTMENT AND ISSUANCE OF THE EIS SHARES . . . . . . . . . . . . .

85

12. PROPOSED ADOPTION OF THE COMPANY EMPLOYEE SHARE OPTION PLAN .

85

12.1 Rationale for the Company ESOP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

85

12.2 Overview of the Company ESOP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

87

12.3 Rationale for including Controlling Shareholders and/or their Associates in the
Company ESOP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

92

12.4 Rationale for including the Proposed Non-Executive Directors (including the
Proposed Independent Directors) in the Company ESOP . . . . . . . . . . . . . . . .

93

12.5 Dilutive Impact of the Company ESOP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

94

12.6 Modifications to the Company ESOP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

94

13. PROPOSED ALLOTMENT AND ISSUANCE OF THE ESOP SHARES . . . . . . . . . . .

94

14. INFORMATION ON THE TARGET COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

94

14.1 History and Milestones . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

94

14.2 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

96

6.

11.

14.3 Business Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

101

14.4 Marketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

126

14.5 Major Customers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

126

14.6 Major Suppliers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

127

14.7 Seasonality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

127

14.8 Credit Policy and Credit Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

128

14.9 Material Properties and Fixed Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

129

14.10 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

132

14.11 Permits, Approvals, Licences and Government Regulations . . . . . . . . . . . . . .

132

14.12 Research and Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

132

14.13 Employees and Staff Training . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

134

14.14 Intellectual Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

136

14.15 Competition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

137

14.16 Competitive Strengths . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

138

2

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15. PROSPECTS, BUSINESS STRATEGIES AND FUTURE PLANS . . . . . . . . . . . . . . .

151

15.1 Trend Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

151

15.2 Order Book . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

152

15.3 Business Strategies and Future Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

152

16. RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

156

16.1 Risks relating to the Business and Industry of the Target Group . . . . . . . . . .

157

16.2 Risks relating to Doing Business in Jurisdictions in which the Target GroupOperates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

187

16.3 Risks relating to VTAC and the Proposed Business Combination . . . . . . . . . .

199

16.4 Risks relating to Ownership of the Company’s Shares and Warrants following
Completion of the Proposed Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . .

203

16.5 Risks relating to Redemption of VTAC Shares and Warrants . . . . . . . . . . . . .

207

17. SELECTED FINANCIAL INFORMATION OF THE TARGET GROUP . . . . . . . . . . . . .

208

18. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND
RESULTS OF OPERATIONS OF THE TARGET GROUP . . . . . . . . . . . . . . . . . . . . .

216

18.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

216

18.2 Factors Affecting the Target Group’s Results of Operations . . . . . . . . . . . . . .

217

18.3 Key Components of the Statements of Profit or Loss and Comprehensive
Income of the Target Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

218

18.4 Results of Operations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

224

18.5 Non-IFRS Financial Measures: Adjusted Net Income/Loss, EBITDA and
Adjusted EBITDA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

230

18.6 Consolidated Balance Sheet Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

231

18.7 Liquidity and Capital Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

232

18.8 Capital Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

237

18.9 Critical Accounting Policies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

238

18.10 Changes in Accounting Policies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

239

18.11 Off-balance Sheet Commitments and Arrangements . . . . . . . . . . . . . . . . . . . .

239

18.12 Financial Risk Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

239

18.13 Contingent Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

242

18.14 Off-Balance Sheet Arrangements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

242

19. CAPITALISATION AND INDEBTEDNESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

242

20. FINANCIAL EFFECTS OF THE PROPOSED TRANSACTIONS . . . . . . . . . . . . . . . .

244

20.1 Bases and Assumption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

244

20.2 Financial Effects on Share Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

245

20.3 Financial Effects on NTA and NTA per Share . . . . . . . . . . . . . . . . . . . . . . . . .

246

20.4 Financial Effects on Earnings and EPS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

247

21. NO MATERIAL EFFECT ON FINANCIAL POSITION . . . . . . . . . . . . . . . . . . . . . . . . .

248

22. USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

248

22.1 Use of Proceeds Raised from the Company’s Initial Public Offering . . . . . . . .

248

22.2 Use of Interests and Income Derived from the Amounts in the Escrow
Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

250

3

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22.3 Use of Proceeds Raised from the PIPE Financing and the Completion
Remaining Escrow Amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

250

23. ENLARGED GROUP CORPORATE AND SHAREHOLDING STRUCTURE . . . . . . . .

255

23.1 Corporate Structure of the Company before Completion . . . . . . . . . . . . . . . . .

255

23.2 Corporate Structure of the Target Group as at the date of this Circular . . . . .

255

23.3 Corporate Structure of the Enlarged Group after Completion . . . . . . . . . . . . .

258

23.4 Share Capital of the Target Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

258

23.5 Changes in Shareholding Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

263

23.6 Dilution Effect Resulting from the Proposed Transactions and the Exercise of
the Warrants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

279

23.7 Moratorium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

288

24. PROPOSED DIRECTORS AND EXECUTIVE OFFICERS OF THE ENLARGED
GROUP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

308

24.1 Proposed Directors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

308

24.2 Experience of the Proposed Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

309

24.3 Present and Past Directorships of the Proposed Directors . . . . . . . . . . . . . . .

312

24.4 Proposed Executive Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

314

24.5 Experience of the Proposed Executive Officers . . . . . . . . . . . . . . . . . . . . . . . .

314

24.6 Present and Past Directorships of the Proposed Executive Officers . . . . . . . .

315

24.7 Familial Relationships . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

315

24.8 Arrangement or Understanding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

315

24.9 Terms of Proposed Directors and Proposed Executive Officers . . . . . . . . . . .

315

24.10 Employment Agreements and Indemnification Agreements . . . . . . . . . . . . . . .

317

24.11 Management Reporting Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

318

24.12 Compensation of Directors and Executive Officers . . . . . . . . . . . . . . . . . . . . .

319

25. INTERESTED PERSON TRANSACTIONS AND POTENTIAL CONFLICTS OF
INTEREST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

322

25.1 Past Interested Persons Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

322

25.2 Present and On-going Interested Persons Transactions . . . . . . . . . . . . . . . . .

322

25.3 Future Interested Persons Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

323

25.4 Guidelines and Review Procedures for Future Interested Person
Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

323

25.5 Potential Conflicts of Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

324

26. CORPORATE GOVERNANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

326

26.1 Board Practices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

326

26.2 Proposed New Nominating Committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

327

26.3 Proposed New Remuneration Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . .

330

26.4 Proposed New Audit Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

331

26.5 Adequacy of Internal Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

335

26.6 Risk Management and Internal Controls of the Target Group . . . . . . . . . . . . .

337

26.7 The Proposed New Audit Committee’s Opinion on
the Suitability of the CFO. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

337

4

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26.8 The Audit Committee’s Opinion on the Suitability of the Independent Business
Valuer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

338

26.9 Information Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

338

27. SHARE PRICE & MARKETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

339

28. DIVIDEND POLICY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

340

28.1 The Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

340

28.2 The Target Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

340

28.3 The Enlarged Group. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

341

29. MATERIAL CONTRACTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

342

29.1 The Target Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

342

29.2 The Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

342

30. MATERIAL LITIGATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

354

31. EXCHANGE CONTROL AND TAXATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

354

31.1 Exchange Control . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

354

31.2 Taxation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

355

32. PROPOSED CHANGE OF THE COMPANY’S NAME . . . . . . . . . . . . . . . . . . . . . . . .

362

32.1 Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

362

32.2 Existing Share Certificates and Warrant Certificates . . . . . . . . . . . . . . . . . . . .

363

33. PROPOSED ADOPTION OF THE NEW MEMORANDUM AND ARTICLES OF
ASSOCIATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

363

33.1 Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

363

33.2 Rationale for the New Memorandum and Articles of Association . . . . . . . . . .

363

33.3 Summary of Main Differences Between the existing Memorandum and Articles
of Association and the New Memorandum and Articles of Association . . . . . .

364

33.4 Summary of Principal Provisions of the New Memorandum and Articles of
Association . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

366

34. PROPOSED CHANGE OF THE COMPANY’S INDEPENDENT AUDITOR. . . . . . . . .

374

34.1 Background and Rationale for the Proposed Change of the Company’s
Independent Auditor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

374

34.2 Information on Ernst & Young LLP. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

375

34.3 Disclosure pursuant to Rule 1205(5) of the Mainboard Rules . . . . . . . . . . . . .

375

35. PROPOSED APPOINTMENT OF THE PROPOSED DIRECTORS. . . . . . . . . . . . . . .

376

36. INTERESTS OF DIRECTORS AND SUBSTANTIAL SHAREHOLDERS. . . . . . . . . . .

376

37. INTERESTS OF SOLE ISSUE MANAGER, JOINT FINANCIAL ADVISERS, JOINT
PLACEMENT AGENTS AND INDEPENDENT BUSINESS VALUER . . . . . . . . . . . . .

376

37.1 Interests of DBS as Sole Issue Manager, Joint Financial Adviser and Joint
Placement Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

376

37.2 Interests of UBS as Joint Financial Adviser and Joint Placement
Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

377

37.3 Interests of Frost & Sullivan Limited as Independent Business Valuer . . . . . .

378

38. INTERESTS OF EXPERTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

378

39. ABSTENTION FROM VOTING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

378

40. DIRECTORS’ RECOMMENDATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

378

5

TABLE OF CONTENTS
41. EXTRAORDINARY GENERAL MEETING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

378

42. IMPORTANT NOTICE TO SHAREHOLDERS AND ACTIONS TO BE TAKEN . . . . . .

379

42.1 Actions to be Taken . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

379

42.2 Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

382

42.3 Exercise of Warrants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

388

43. CONSENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

388

44. RESPONSIBILITY STATEMENTS OF THE DIRECTORS AND THE PROPOSEDDIRECTORS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

390

45. RESPONSIBILITY STATEMENT OF THE SOLE ISSUE MANAGER . . . . . . . . . . . . .

391

46. RESPONSIBILITY STATEMENT OF THE SPONSOR . . . . . . . . . . . . . . . . . . . . . . . .

391

47. GENERAL AND
STATUTORYINFORMATION(INCLUDING
MATERIAL
BACKGROUND INFORMATION) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

391

48. DOCUMENTS AVAILABLE FOR INSPECTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

395

APPENDIX A: INDEPENDENT AUDITOR’S REPORT AND AUDITED CONSOLIDATEDFINANCIAL STATEMENTS OF THE TARGET GROUP FOR THE FINANCIAL YEARSENDED 31 DECEMBER 2020, 2021 AND 2022 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

A-1

APPENDIX B: INTERIM CONSOLIDATED FINANCIAL STATEMENTS OF THE TARGETGROUP FOR THE SIX-MONTH PERIOD ENDED 30 JUNE 2023 . . . . . . . . . . . . . . . . . .

B-1

APPENDIX C: UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION
OF THE ENLARGED GROUP FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022
AND THE SIX-MONTH PERIOD ENDED 30 JUNE 2023 . . . . . . . . . . . . . . . . . . . . . . . . .

C-1

APPENDIXD:PROPOSEDNEWMEMORANDUM
AND
ARTICLES
OF ASSOCIATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

D-1

APPENDIX E: BLACKLINE OF PROPOSED NEW MEMORANDUM AND ARTICLES OF
ASSOCIATION AGAINST CURRENT MEMORANDUM AND ARTICLES OF
ASSOCIATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

E-1

APPENDIX F: INDEPENDENT MARKET RESEARCH REPORT . . . . . . . . . . . . . . . . . . .

F-1

APPENDIX G: GOVERNMENT REGULATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

G-1

APPENDIX H: RULES OF THE COMPANY ESOP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

H-1

APPENDIX I: RULES OF THE EIS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

I-1

APPENDIX J: FINANCIAL TARGETS FOR EARNOUT . . . . . . . . . . . . . . . . . . . . . . . . . .

J-1

APPENDIX K: TERMS AND CONDITIONS OF THE SPA . . . . . . . . . . . . . . . . . . . . . . . . .

K-1

APPENDIX L: INTELLECTUAL PROPERTY RIGHTS OF THE TARGET GROUP . . . . . .

L-1

APPENDIX M: SUMMARY VALUATION LETTER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

M-1

6CORPORATE INFORMATION
Current Board of
Directors:

Mr. Chua Kee Lock (Non-Executive Chairman)
Mr. Jiang Honghui (Executive Director and CEO)Ms. Anupama Sawhney (Non-Executive Director)
Dr. Steve Lai Mun Fook (Independent Director)
Mr. Low Seow Juan (Independent Director)
Mr. Tan Hup Foi (Independent Director)

Proposed New Board of
Directors on Completionof the Proposed
Transactions:

Mr. Phua Jiexian Joseph (Non-Executive Director andChairman)
Mr. Lien Chien-Lin (Executive Director and CEO)Mr. Akio Tanaka (Non-Executive Director)
Mr. Tan Hup Foi (Independent Non-Executive Director)
Dr. Steve Lai Mun Fook (Independent Non-Executive
Director)
Mr. Hideto Mizuno (Independent Non-Executive Director)
Ms. Chen Xiuling (Independent Non-Executive Director)

Company Secretary:

Ms. Eunice Hooi Lai Fann(a member of the Institute of Singapore Chartered
Accountants)

Registered Office of theCompany:

c/o Maples Corporate Services Limited
PO Box 309
Ugland House
Grand Cayman KY1-1104
Cayman Islands

Principal Place ofBusiness of the Company:

250 North Bridge Road
#11-01
Raffles City Tower
Singapore 179101

Registered Office of theTarget Company:

c/o Harneys Fiduciary (Cayman) Limited
4th Floor, Harbour Place
103 South Church Street
P.O. Box 10240
Grand Cayman KY1-1002
Cayman Islands

Principal Place ofBusiness of the Target
Group

:

2-12-28, Kita-Aoyama, Minato City, Tokyo, Japan

New Principal Place ofBusiness of the Enlarged
Group after Completion:

2-12-28, Kita-Aoyama, Minato City, Tokyo, Japan

7

CORPORATE INFORMATION
Share Registrar:

Boardroom Corporate & Advisory Services Pte. Ltd.
1 Harbourfront Avenue#14-07
Keppel Bay Tower
Singapore 098632

Sole Issue Manager tothe Company:

DBS Bank Ltd.
12 Marina BoulevardMarina Bay Financial Centre Tower 3
Singapore 018982

Joint Financial Advisers
and Joint Placement
Agents to the Company:

DBS Bank Ltd.
12 Marina BoulevardMarina Bay Financial Centre Tower 3
Singapore 018982
UBS AG, Singapore Branch
9 Penang Road
Singapore 238459

Legal Advisers to theCompany:

as to Singapore law
Eng and Co. LLC
7 Straits View
#11-01 Marina One East Tower
Singapore 018936
as to Cayman Islands law
Maples and Calder (Singapore) LLP
1 Raffles Place#36-01 One Raffles PlaceSingapore 048616
as to Japan law
Nishimura & Asahi (Gaikokuho Kyodo Jigyo)
Otemon Tower,
1-1-2 Otemachi
Chiyoda-ku
Tokyo 100-8124, Japan
Nishimura & Asahi (Singapore) LLP
79 Robinson Road #14-01
Singapore 068897
as to Taiwan law
Lin & Partners, Attorneys-at-Law
11/F, No. 2, Sec. 1, Dunhua S. Road
Songshan Dist.,
Taipei 10506, Taiwan (Republic of China)

8

CORPORATE INFORMATION
as to Hong Kong law
Deacons
5th Floor
Alexandra House
18 Chater Road
Central, Hong Kong
Legal Advisers to the
Joint Financial Advisers:

as to Singapore law
WongPartnership LLP
12 Marina Boulevard Level 28
Marina Bay Financial Centre Tower 3
Singapore 018982
as to U.S. law
Freshfields Bruckhaus Deringer Singapore Pte. Ltd.
10 Collyer Quay 42-01
Ocean Financial Centre
Singapore 049315

Legal Advisers to theTarget Company:

as to Hong Kong law, Japan law, Taiwan law, UnitedStates law and Singapore law as Global Lead Counsel
K&L Gates LLP
44th Floor, Edinburgh Tower
The Landmark, 15 Queen’s Road Central
Hong Kongas to Singapore law
Rajah & Tann Singapore LLP
9 Straits View #06-07
Marina One West Tower
Singapore 018937
as to Cayman Islands law
Harney Westwood & Riegels
3501, The Centre,
99 Queen’s Road Central,
Hong Kong

Independent Auditor to
the Company:

KPMG LLP
12 Marina View
#15-01
Asia Square Tower 2
Singapore 018961
Partner-in-charge: Mr. Gerald Low(a member of the Institute of Singapore Chartered
Accountants)

9

CORPORATE INFORMATION
Independent Auditor andReporting Accountant to
the Target Group:

Ernst & Young LLP
One Raffles Quay
North Tower, Level 18
Singapore 048583
Partner-in-charge: Ms. Sharon Peh(a member of the Institute of Singapore Chartered
Accountants)

Independent Reporting
Accountant to theEnlarged Group:

Ernst & Young LLP
One Raffles Quay
North Tower, Level 18
Singapore 048583
Partner-in-charge: Ms. Sharon Peh(a member of the Institute of Singapore Chartered
Accountants)

Independent Business
Valuer to the Company:

Frost & Sullivan Limited
Unit 3006, 30/F
Two Exchange Square
8 Connaught Place, Central, Hong Kong

Independent Market
Research Consultant to
the Target Company:

Frost & Sullivan (Singapore) Pte Ltd
9 Battery Road
#15-01 MYP Centre
Singapore 049910

10

DEFINITIONSIn this Circular, the following definitions apply throughout, unless the context requires otherwise:
Companies within the Enlarged Group“17LIVE Cayman” or“Target Company”:

17LIVE Inc., an exempted company incorporated under thelaws of the Cayman Islands“17LIVE HK”:

17LIVE Ltd., a limited liability company incorporated under
the laws of Hong Kong

“17LIVE Japan”:

17LIVE Japan Inc., a company incorporated under the lawsof Japan“17LIVE Taiwan”:

17LIVE (Taiwan) Limited, a company incorporated under
the laws of Taiwan“17LIVE SEA”:

17LIVE (SEA) Pte. Ltd., a company incorporated under thelaws of Singapore“17LIVE USA”:

17LIVE (USA) Corp., a company incorporated under thelaws of the United States“Company” or “VTAC”:

Vertex Technology Acquisition Corporation Ltd, an
exempted company incorporated under the laws of the
Cayman Islands“Enlarged Group”:

The enlarged group of companies comprising the Company
and the Target Group immediately following Completion“HandsUp”:

HandsUp Inc., a company incorporated under the laws of
Taiwan“Liontrek”:

Liontrek Entertainment India Private Limited, a company
incorporated under the laws of India

“NEI”

:

Next Entertainment Inc., a company incorporated under thelaws of Taiwan“Target Group”:

17LIVE Cayman, 17LIVE Japan and its subsidiaries,
namely, 17LIVE HK, 17LIVE SEA, 17LIVE USA, NEI,
Wave, HandsUp, 17LIVE Taiwan and Liontrek“Wave”:

Wave Inc., a company incorporated under the laws of
TaiwanOther Companies, Organisations and Entities“17LIVE Holdco” or“Vendor”:

17LIVE Holding Limited, an exempted company
incorporated under the laws of the Cayman Islands“ACRA”:The Accounting and Corporate Regulatory Authority ofSingapore“Authority”:

Monetary Authority of Singapore

11

DEFINITIONS
“CDP”

:

The Central Depository (Pte) Limited

“CS”

:

Credit Suisse (Singapore) Limited

“DBS”

:

DBS Bank Ltd.

“Escrow Agent”:

Citibank, N.A., Singapore Branch“FFMC”:

Fullerton Fund Management Company Ltd.

“Ichi Nana Inc.”:

Ichi Nana Inc., a BVI business company incorporated
under the laws of the British Virgin Islands“Ichi Nana Inc. Taiwan
Branch”:

Ichi Nana Inc. Taiwan Branch, a company incorporated
under the laws of Taiwan“IMR Consultant”:

Frost & Sullivan (Singapore) Pte Ltd“Independent Auditor”:

KPMG LLP“Independent Business
Valuer”:

Frost & Sullivan Limited“Innoven”:

Innoven Capital Singapore Pte. Ltd.

“Joint Financial Advisers”
or “Joint Placement
Agents”:

Collectively, DBS and UBS“Machipopo”:

Machipopo K.K., a company incorporated under the laws of
Japan“NEBJ”:

Next Entertainment Science & Technology (Beijing) Co.,
Ltd., a company incorporated under the laws of the PRC“NEGH”:

Next Entertainment Global Holding, an exempted company
incorporated under the laws of the Cayman Islands“NEHK”:

Next Entertainment (Hong Kong) Limited, a limited liability
company incorporated under the laws of Hong Kong

“NETW”:

Next Entertainment Limited Taiwan Branch, a company
incorporated under the laws of Taiwan“Pavilion”:

Pav Investments Pte. Ltd.

“SGX-ST” or the“Exchange”:

Singapore Exchange Securities Trading Limited“Share Registrar”:

Boardroom Corporate & Advisory Services Pte. Ltd.

“Sole Issue Manager”

:

DBS

12

DEFINITIONS“Sponsor” or “Vertex”:

Vertex Venture Holdings Ltd“Sponsor Group”:

The Sponsor and its subsidiaries“Stabilising Manager”:

Credit Suisse (Singapore) Limited“Temasek”:

Temasek Holdings (Private) Limited

“UBS”

:

UBS AG, Singapore Branch“Tembusu”:

Tembusu Capital Pte. Ltd.

“Venezio”:

Venezio Investments Pte. Ltd.

“Vertex Captive Funds”:

The 9 funds wholly-owned and managed by Vertex as atthe Latest Practicable Date

“Vertex Network Funds”:

The 20 global network funds managed by Vertex Ventures
Israel, Vertex Ventures USA, Vertex Ventures China,
Vertex Ventures SEA & India and Vertex Growth through apartnership model as at the Latest Practicable Date

“Vertex Funds”:

Vertex Legacy Continuation Fund Pte. Ltd., Vertex
Ventures SEA Fund III Pte. Ltd. and Vertex Growth Fund
Pte. Ltd.

“Vertex Growth”:

Refers to all the GPs managing Vertex Growth (SG) LP and
Vertex Growth II (SG) LP“Vertex SPV”:

Vertex Co-Investment Fund Pte. Ltd.

“Vertex Ventures China”:

Refers to all the GPs managing the Vertex Network Funds
in China“Vertex Ventures Israel”:

Refers to all the GPs managing the Vertex Network Funds
in Israel“Vertex Ventures SEA &India”:

Refers to all the GPs managing the Vertex Network Funds
in Southeast Asia and India“Vertex Ventures USA”:

Refers to all the GPs managing the Vertex Network Funds
in the USA“VVMPL”:

Vertex Venture Management Pte. Ltd.

“Warrant Agent”:

Boardroom Corporate & Advisory Services Pte. Ltd., orsuch other person as may be appointed as such from time
to time by the Company pursuant to the Warrant Agreement

13

DEFINITIONSGeneral“1H FY2022”:

The six-month financial period ended 30 June 2022

“1H FY2023”:

The six-month financial period ended 30 June 2023

“17LIVE Cayman ESOP”:

The share incentive plans of the Target Company, as
amended from time to time

“17LIVE Cayman
Shareholders”:

The holders of shares in the share capital of the Target
Company prior to the Restructuring“17LIVE RSUs”:

17LIVE Unvested RSUs and 17LIVE Vested RSUs

“17LIVE Unvested RSUs”:

The 3,027,215 outstanding unvested RSUs to acquire
shares in the capital of the Target Company issued
pursuant to an award granted under the 17LIVE Cayman
ESOP“17LIVE Unvested RSU
Holders”:

Holders of the 17LIVE Unvested RSUs

“17LIVE Vested RSUs”:

The 18,349,125 outstanding vested RSUs to acquire
shares in the capital of the Target Company issued
pursuant to an award granted under the 17LIVE Cayman
ESOP“17LIVE Vested RSU
Holders”:

Holders of the 17LIVE Vested RSUs

“17LIVE Warrants”:

The 562,802 warrants issued by the Target Company
which, as at the Latest Practicable Date, have been
exercised and converted into 562,802 Sale Shares“17LIVE Warrant Holders”:

Holders of the 17LIVE Warrants“30-day Redemption
Period”:

The period starting on a date not less than 30 days prior to
the Warrant Redemption Date, to the Warrant Redemption
Date“Actual Special Bonus
Shares”:

Has the meaning ascribed to it in Section 29.2 titled“Material Contracts – The Company – Deed of Waiver” ofthis Circular“Additional Warrants”:

The 0.2 of one Warrant per Share to be issued to the
Non-Redeeming Shareholders and Vertex SPV at or
around Completion for each Share held as at the
Redemption Record Date

“AGM”

:

The annual general meeting of the Company

14

DEFINITIONS“Allotted EIS Shares”:

Has the meaning ascribed to it in Section 29.2 titled“Material Contracts – The Company – Deed of Waiver” ofthis Circular“Announcement”:

The announcement on the Proposed Business
Combination made by the Company on SGXNET on the
Announcement Date

“Announcement Date”:

2 October 2023, being the date of the Announcement“Associate”:(a)

In relation to any director, CEO, substantial
shareholder or Controlling Shareholder (being an
individual) means:(i)

his immediate family;(ii)

the trustees of any trust of which he or his
immediate family is a beneficiary or, in the caseof a discretionary trust, is a discretionary object;or(iii) any company in which he and his immediatefamily together (directly or indirectly) have aninterest of 30.0% or more; and(b)

In relation to a Substantial Shareholder or aControlling 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 othercompany or companies taken together (directly or
indirectly) have an interest of 30.0% or more, savethat:in respect of Temasek (for the purpose of Section 23.7
titled “Enlarged Group Corporate and Shareholding
Structure – Moratorium” of this Circular only),“associates” includes only the following:(A)

the direct and indirect wholly-owned subsidiaries
of Temasek whose boards of directors orequivalent
governing
bodiescompriseemployees and nominees of (1) Temasek;(2) Temasek Pte. Ltd.; and/or (3) any direct andindirect wholly-owned subsidiaries of Temasek
Pte. Ltd.

15

DEFINITIONS
For the avoidance of doubt, save for Section 23.7
titled “Enlarged Group Corporate and Shareholding
Structure – Moratorium” of this Circular, references to“associate” in respect of Temasek elsewhere in thisCircular means any other company which is its
subsidiary or holding company or is a subsidiary ofsuch 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 company, means a company in which atleast 20% but not more than 50% of its shares are held by
the first mentioned company“Audit Committee”:

The audit committee of the Company as at the Latest
Practicable Date

“Base PIPE Shares”:

Up to 2,000,000 new Shares to be allotted and issued to
the PIPE Investors pursuant to the PIPE Financing“Basic Sale Shares”:

The 250,481,652 issued shares in the capital of the Target
Company“BC Deadline”:

24 months from the Listing Date

“Board” or “Directors”:

The board of directors of the Company as at the date of thisCircular, unless where the context requires, means theboard of directors of the Company for the time being“Business Day”:

A day (excluding Saturdays, Sundays and public holidays)on which banks generally are open in Singapore for thetransaction of normal banking business

“CAT”

:

Copyright Act of Japan, as may be amended, varied or
supplemented from time to time

“Cayman Companies Act”:

The Companies Act (As Revised) of the Cayman Islands

“CEO”

:

Chief Executive Officer

“CFO”

:

Chief Financial Officer“CG Code”:

The Code of Corporate Governance 2018, as may beamended, varied or supplemented from time to time

“Circular”:

This circular to the Shareholders dated 9 November 2023

16

DEFINITIONS“Company ESOP” or“Company Employee
Share Option Plan”:

The share incentive scheme established or to beestablished by the Company for the allotment and issuanceof up to 2,114,891 ESOP Shares, being equivalent to theaggregate of (a) 1,799,777 ESOP Shares (calculated
based on (i) 3,027,215 17LIVE Unvested RSUs divided by(ii) the Exchange Ratio and rounded to the nearest whole
number), and (b) up to 315,114 ESOP Shares to be issued
pursuant to the Company ESOP“Company ESOP Rules”:

The rules of the Company ESOP as set out in Appendix H
to this Circular“Company Transaction
Expenses”:

Any out-of-pocket fees and expenses payable by theCompany or any of its affiliates (whether or not billed or
accrued for) as a result of or in connection with thenegotiation, documentation and consummation of the
Proposed Business Combination and the transactions
contemplated in the SPA or any of the other Transaction
Documents (as defined in the SPA), including (a) all fees,
costs, expenses, brokerage fees, commissions, finders’fees and disbursements of the Joint Financial Advisers andthe Sole Issue Manager, investment banks, data roomadministrators, attorneys, accountants and other advisers
and service providers, including consultants and public
relations firms, and (b) any and all filing fees payable by theCompany or its affiliates to any governmental authority inconnection with the Proposed Business Combination, thetransactions contemplated in the SPA or any of the otherTransaction Documents (as defined in the SPA)“Completion”:

The completion of the Proposed Transactions“Completion Date”:

The date on which Completion takes place“Completion Remaining
Escrow Amount”:

The amount held in the Escrow Account as at theCompletion Date

“Conditional Resolutions”:

The conditional resolutions in this Circular, being:(a)Ordinary Resolution 10: Proposed Change of theCompany’s Independent Auditor;(b)

Ordinary Resolution 11: Proposed appointment of
Mr. Phua Jiexian Joseph as a new Director uponCompletion;(c)Ordinary Resolution 12: Proposed appointment of
Mr. Lien Chien-Lin as a new Director uponCompletion;(d)Ordinary Resolution 13: Proposed appointment of
Mr. Akio Tanaka as a new Director upon Completion;

17

DEFINITIONS(e)

Ordinary Resolution 14: Proposed appointment of
Mr. Hideto Mizuno as a new Director uponCompletion; and(f)Ordinary Resolution 15: Proposed appointment of
Ms. Chen Xiuling as a new Director upon Completion“Conditions Precedent”
and each a “Condition
Precedent”:

The conditions precedent of the SPA as set out in
Section 5.10 titled “Proposed Business Combination –Conditions Precedent” of this Circular“Consideration Shares”:

160,162,651 new Shares in the aggregate, comprising:“Controlling Shareholder”:(a)in respect of the Basic Sale Shares, 148,918,937
Consideration Shares to be allotted and issued to the
Vendor (or if the Vendor so nominates, to the Vendor
Shareholders) on the Completion Date;(b)in respect of the 17LIVE Vested RSUs, 10,909,111
Consideration Shares to be allotted and issued to the
17LIVE Vested RSU Holders on the Completion Date;
and

(c)

in respect of the 17LIVE Warrants, 334,603
Consideration Shares to be allotted and issued to the
17LIVE Warrant Holders on the Completion Date

As defined in the Mainboard Rules, a person who:–(a)holds directly or indirectly 15% or more of the total
voting rights in the company. The SGX-ST may
determine that a person who satisfies this paragraphis not a Controlling Shareholder; or(b)in fact exercises control over a company“Converted RSU Award”:

Has the meaning ascribed to it in Section 12.1 titled“Proposed Adoption of the Company Employee Share
Option Plan – Rationale for the Company ESOP” of thisCircular“Converted Shares”:

Up to 41,606,000 Shares to be issued, credited as fully
paid, upon the exercise of the Warrants in accordance with
the Warrant Agreement, including where the context
admits, such new Shares arising from the exercise of any
further Warrants which may be issued pursuant to theterms and conditions of the Warrants as set out in the
Warrant Agreement

18

DEFINITIONS“Cornerstone Units”:

The aggregate of 22.2 million Units which the Cornerstone
Investors (as defined in the Prospectus) have subscribedfor at the Offering Price pursuant to the Cornerstone
Subscription Agreements (as defined in the Prospectus)

“CPA”

:

Consumer Protection Act of Taiwan

“CTO”

:

Chief Technology Officer“Deed of Waiver”:

The deed of waiver entered into by the Sponsor in favour of
the Company pursuant to which the Sponsor agrees towaive its rights to the allotment and issuance of a certain
number of Promote Shares“Draft OTT Law”:

The draft Law Governing Management of Provision ofInternet Audio and Video Services (網際網路視聽服務管理法草案) in Taiwan“Earnout Framework”:

The earnout framework where the Earnout Shares areallotted and issued to the Earnout Shareholders in two
tranches on the applicable Earnout Vesting Date subject toand based on the Financial Targets for Earnout achieved“Earnout Record Date”:

In respect of each Earnout Vesting Date, a date that isthree Market Days before such Earnout Vesting Date

“Earnout Shares”:

Up to 24,408,000 new Shares to be allotted and issued to
the Earnout Shareholders subject to and based on the
Financial Targets for Earnout achieved“Earnout Shareholders”:

Each Vendor Shareholder that remains as a record holderof Shares as at the applicable Earnout Record Date (being
nominated, by and at the discretion of the Vendor, toreceive the Earnout Shares)“Earnout Vesting Date”:

Each of 30 April 2024 and 30 August 2024, as applicable

“EGM”

:

The extraordinary general meeting of the Company, noticeof which is set out in the Notice of EGM“EIS” or “Executive
Incentive Scheme”:

The share incentive scheme established or to beestablished by the Company for the allotment and issuanceof up to 2,550,000 EIS Shares in favour of the Key
Executives to be vested over a three-year period following
Completion, subject to and based on the Financial Targets
for EIS achieved“EIS Rules”:

The rules of the EIS as set out in Appendix I to this Circular“EIS Shares”:

Up to 2,550,000 new Shares to be allotted and issued
pursuant to the Executive Incentive Scheme

19

DEFINITIONS“EIS Vesting Date”:

Each of 30 April 2024, 30 April 2025 and 30 April 2026, asapplicable“Election Period”:

The period for the Redemption starting on 9 November
2023, being the date of the Notice of EGM, and ending on
28 November 2023 at 2.00 p.m., being 72 hours prior to thecommencement of the EGM“Enlarged Group’s
Management Team”:

The Proposed Executive Director and the Proposed
Executive Officers“Enlarged Share Capital”:

The enlarged issued and paid-up share capital of theCompany upon Completion after Redemption (if any), theallotment and issuance of the Consideration Shares, theBase PIPE Shares and the Special Bonus Shares, but
before the allotment and issuance of the Earnout Shares,
the EIS Shares and the ESOP Shares, and including theexisting issued and paid-up Shares of the Company as at
Completion, being:(a)207,529,251 Shares, being the enlarged issued andpaid-up share capital of the Company assuming that
there is No Redemption and that the total proceeds
raised from the PIPE Financing is S$10.0 million; and(b)

174,962,651 Shares, being the enlarged issued andpaid-up share capital of the Company assuming that
there is Maximum Redemption and that the total
proceeds raised from the PIPE Financing is
S$10.0 million.

For the avoidance of doubt, the Enlarged Share Capital does
not include the Promote Shares to be allotted and issued toVertex SPV as such Promote Shares will only be allotted andissued to Vertex SPV after Completion based on the vestingschedule set out in Section 29.2 titled “Material Contracts –The Company – Promote Shares Deed of Undertaking” of thisCircular.
“Entity at Risk”

“EPS”

:

:

Means:(a)the issuer;(b)a subsidiary of the issuer that is not listed on the
SGX-ST or an approved exchange; or(c)an associated company of the issuer that is not listed on
the SGX-ST or an approved exchange, provided that thelisted group, or the listed group and its interested
person(s), has control over the associated company.

Earnings per share

20

DEFINITIONS“Escrow Account”:

The escrow account established and maintained by theCompany with the Escrow Agent containing the proceedsfrom the Offering, the issuance of the Cornerstone Units, theSponsor IPO Investment Units and the Additional Units(including interest accrued from time to time thereon)“ESOP Shares”:

The new Shares to be allotted and issued pursuant to theCompany ESOP

“Eurozone”:

The economic region formed by those member countries of
the European Union that have adopted the euro as theirprimary currency and sole legal tender“Exchange Ratio”:

Means 1.682, which is equal to the number of Sale Shares
divided by the number of Consideration Shares and rounded
to the third decimal place“Executive Director”:

An executive director of the Company as at the date of thisCircular, unless where the context requires, means an
executive director of the Company for the time being“Executive Officer”:

An executive officer of the Company as at the date of thisCircular from time to time, unless where the context requires,means an executive officer of the Company for the time
being, who is also a key executive as defined under the SFR“Existing Warrants”:

The 0.3 of one Warrant per Share which was issued to all
Shareholders at the completion of the Offering“FEFTA”:

Foreign Exchange and Foreign Trade Act of Japan, as may beamended, varied or supplemented from time to time

“FIL”

:

Statute for Investment by Foreign Nationals of Taiwan, as
may be amended, varied or supplemented from time to time

“Final Adjusted Maximum
Promote Shares”:

The maximum number of Promote Shares that the Sponsor isentitled to prior to 30 April 2026, being equivalent in number
to the Original Maximum Promote Shares after deducting theActual Special Bonus Scheme Shares and the Allotted EIS
Shares for the EIS Vesting Dates being 30 April 2024, 30 April
2025 and 30 April 2026

“Financial Targets for
Earnout”:

The financial targets and key performance indicators as set
out in Appendix J of this Circular“Financial Targets for EIS”:

The financial targets and key performance indicators for the
management of the Enlarged Group to be agreed by theCompany and the Target Company and recorded in an
addendum to the Sale and Purchase Agreement to beentered into prior to Completion

21

DEFINITIONS“Foreign Source Income
Exemption”:

The foreign source income exemption regime for passive
income as set out in the Inland Revenue (Amendment)(Taxation on Specified Foreign-sourced Income) Ordinance2022 (the Amendment Ordinance) of Hong Kong

“Founder”:

The founder as defined in the SPA, namely, Phua Jiexian
Joseph“founding shareholder”:

Person who founded and sponsored the establishment of theCompany, i.e. the Sponsor“Fullerton”:

Fullerton (Private) Limited“Fully Enlarged Share
Capital”:

The aggregate of the Enlarged Share Capital and theenlarged issued and paid-up share capital of the Company
after the allotment and issuance of the Earnout Shares, the
EIS Shares and the ESOP Shares, the vesting of the Promote
Shares and the exercise of the Public Warrants and thePrivate Placement Warrants, being:(a)up to 253,978,925 Shares, being the fully enlarged
issued and paid-up share capital of the Company
assuming that there is No Redemption and that the total
proceeds raised from the PIPE Financing is S$10.0
million; and(b)up to 222,235,372 Shares, being the fully enlarged
issued and paid-up share capital of the Company
assuming that there is Maximum Redemption and thatthe total proceeds raised from the PIPE Financing is
S$10.0 million.

“FY”

:

In respect of the Company, the Target Company and theEnlarged Group (as the case may be), the financial year
ended or ending 31 December“Gatefold”:

The gatefold cover to this Circular

“GPs”

:

The general partners that manage the respective Vertex
funds“Group EBITDA”:

With respect to a financial period, the earnings before
interest, taxes, depreciation and amortisation of the Target
Group as shown in the audited or reviewed consolidated
financial statements of the Target Group for that applicablefinancial period; and for the avoidance of doubt, “GroupEBITDA” shall not include (i) any liabilities in relation to theclassification of the Target Company’s preference share classor warrants; (ii) Vendor and Target Company Transaction
Expenses or Company Transaction Expenses; and (iii) any
amounts paid by the Target Group pursuant to the share
repurchase agreement dated 10 November 2020

22

DEFINITIONS“Group Operating
Revenue”:

With respect to a financial period, the operating revenue of
the Target Group as shown in the audited or reviewed
consolidated financial statements of the Target Group for thatapplicable financial period“Hong Kong”:

The Hong Kong Special Administrative Region of the PRC“IASB”:

International Accounting Standards Board

“IAS”

:

International Accounting Standards“IFRIC Interpretations”:

Interpretations issued by the International
Reporting Interpretations Committee“IFRS”:

International Financial Reporting Standards“IMR Report”:

The report titled “Independent Market Research on the Mediaand Entertainment Industry with a Focus on the Interactive
Video Streaming Platform, V-Liver, and Live Commerce
Industries” dated 23 October 2023 prepared by the IMR
Consultant for the Target Company“Initial Adjusted Maximum
Promote Shares”:

The maximum number of Promote Shares that the Sponsor isentitled to prior to 30 April 2026, being equivalent in number
to the Original Maximum Promote Shares after deducting theActual Special Bonus Shares and 2,550,000, which is the
maximum number of EIS Shares that may be allotted andissued by the Company“initial businesscombination”:

An initial acquisition of an operating business or assets under
Rule 210(11)(m)(iii) of the Listing Manual (such acquisition in
the form of a merger, share exchange, asset acquisition,
share purchase, reorganisation, or such other similarbusiness combination methods“Interested Person”:

Means:

Financial(a)a Director, CEO, or Controlling Shareholder of theCompany; or(b)an associate of any such Director, CEO, or Controlling
Shareholder.

“Interested Person
Transaction”:

A transaction between an Entity at Risk and an Interested
Person“Issue Price”:

S$5.00 per Share“IVAS”:The Institute of Valuers and Appraisers, Singapore“Key Executives”:

The members of the management team and the members of
the Proposed New Board of the Enlarged Group who will beentitled to the allotment and issuance of the EIS Shares

23

DEFINITIONS“Key Resolutions”:

The key resolutions in this Circular, being:(a)Ordinary Resolution 1: Proposed Business Combination
between the Company and 17LIVE Inc. by way of an
acquisition by the Company of the entire issued andpaid-up share capital of 17LIVE Inc. from the Vendor for
the Purchase Consideration;(b)

Ordinary Resolution 2: Proposed allotment andissuance of 160,162,651 Consideration Shares at theIssue Price of S$5.00 in partial satisfaction of thePurchase Consideration for the Proposed Business
Combination;(c)Ordinary Resolution 3: Proposed allotment andissuance of up to 24,408,000 Earnout Shares at theIssue Price of S$5.00 to the Earnout Shareholders inpartial satisfaction of the Purchase Consideration for the
Proposed Business Combination, subject to thesatisfaction of the Financial Targets for Earnout;(d)Ordinary Resolution 4: Proposed allotment andissuance of up to 2,000,000 Base PIPE shares at theIssue Price of S$5.00 to the PIPE Investors;(e)Ordinary Resolution 5: Proposed allotment andissuance of up to 3,760,600 Special Bonus Shares at
the Issue Price of S$5.00 to the Non-Redeeming
Shareholders and the PIPE Investors;(f)Ordinary Resolution 6: Proposed Adoption of the
Executive Incentive Scheme;(g)Ordinary Resolution 7: Proposed allotment andissuance of up to 2,550,000 EIS Shares at the Issue
Price of S$5.00 to the Key Executives, subject to thesatisfaction of the Financial Targets for EIS;(h)

Ordinary Resolution 8: Proposed Adoption of theCompany Employee Share Option Plan;(i)

Ordinary Resolution 9: Proposed allotment andissuance of up to 2,114,891 ESOP Shares pursuant to
the Company Employee Share Option Plan;(j)Special Resolution 1: Proposed Change of theCompany’s Name to “17LIVE Group Limited”; and(k)Special Resolution 2: Proposed Adoption of the New
Memorandum and Articles of Association

24

DEFINITIONS“Latest Practicable Date”:

31 October 2023, being the latest practicable date prior to thedate of this Circular“Liquidation”:

An event wherein if the Company has not consummated an
initial business combination within 24 months from the Listing
Date (or such period as may be extended pursuant toapprovals from SGX-ST and the Shareholders, suchextension up to no more than 12 months and subject to an
overall maximum time frame of 36 months from the ListingDate), the Company will: (i) cease all operations except forthe purpose of winding up; (ii) to afford the Company with
sufficient time for liaison with the Escrow Agent and the Share
Registrar and in accordance with applicable law, as promptly
as reasonably possible but not more than 10 Market Daysthereafter, redeem the Shares, at a per-Share price, on a
pro-rata basis, payable in cash, equal to the aggregate
amount then on deposit in: (a) the Escrow Account, includinginterest earned on the funds held in the Escrow Account andnot previously released to the Company to pay theCompany’s income taxes or operating expenses, if any (lessany liquidation expenses); and (b) such other bank accounts
held by the Company, divided by the number of the thenoutstanding Shares (which for the avoidance of doubt,
includes the Shares held by Venezio and the Sponsor but
does not include the Promote Shares), which redemption willcompletely extinguish Shareholders’ rights as Shareholders(including the right to receive further liquidation distributions,
if any); and (iii) as promptly as reasonably possible following
such redemption, subject to the remaining Shareholders andthe Board of Directors, liquidate and dissolve, subject in thecase of clauses (ii) and (iii), to the Company’s obligations
under applicable law to provide for claims of creditors and therequirements of other applicable law and in accordance with
the Memorandum and Articles of Association“Listing”:

Listing of the issued Units (including the Additional Units), theOffering Units and the Cornerstone Units (as defined in the
Prospectus), as well as all the Company’s Shares andWarrants on the Mainboard of the SGX-ST“Listing Application”:

The application for listing and quotation of the Consideration
Shares, the Earnout Shares, the EIS Shares, the ESOP
Shares, the PIPE Shares and the Special Bonus Shares on
the Mainboard“Listing Date”:

The date of the Listing, i.e. 20 January 2022

“Listing Manual”:

The listing manual of the SGX-ST as amended, modified or
supplemented from time to time“Long Stop Date”:

20 January 2024 (or such other date as the parties may agree
in writing)

“LP”

:

Limited partner
25

DEFINITIONS“LPD Remaining Escrow
Amount”:

The amount held in the Escrow Account as at the Latest
Practicable Date

“Mainboard”:

The Mainboard of the SGX-ST“Mainboard Rules”:

The SGX-ST listing rules for the Mainboard“Management andPlacement Agreement”:

The management and placement agreement or similar
agreement entered into by the Company and the Joint
Financial Advisers (and/or their respective affiliates, as thecase may be) in connection with the role of the Joint Financial
Advisers to the Proposed Business Combination and the
Joint Placement Agents to the PIPE Financing, as the casemay be“Management Team”:

The Executive Directors and Executive Officers of theCompany as at the date of this Circular, unless where thecontext requires, means the Executive Directors andExecutive Officers of the Company for the time being“Management Warrantors”:

The management warrantors as defined in the SPA, namely
Lien Chien-Lin, Ng Jing Shen and Kenta Masuda“Market Day”:

A day on which the SGX-ST is open for trading in securities“Maximum Allocation”:

Has the meaning given to it in Section 10.2 titled “Proposed
Adoption of the Executive Incentive Scheme – Overview of
the EIS” of this Circular“Maximum Redemption”:

The scenario where all Shareholders (save for Vertex SPV
and Venezio) exercise their Redemption Right“Memorandum and Articles
of Association” or “M&AA”:

The Memorandum and Articles of Association of theCompany, as amended or modified from time to time

“MOEA”:

Ministry of Economic Affairs of Taiwan

“NAV”

:

Net asset value“New Pension Scheme”:

The new labour pension system under the Labour Pension
Act of Taiwan“New Memorandum andArticles of Association” or“New M&AA”:

The new amended and restated memorandum and articles ofassociation proposed to be adopted by the Company, theterms of which are set out in Appendix D to this Circular“No Redemption”:

The scenario where none of the Shareholders (including
Vertex SPV and Venezio) exercise their Redemption Right“Nominating Committee”:

The nominating committee of the Company as at the Latest
Practicable Date

26

DEFINITIONS“Non-Redeeming
Shareholders”:

Existing Shareholders (other than Vertex SPV) who holdShares as at the Redemption Record Date and who will beentitled to the Special Bonus NRS Shares and the Additional
Warrants based on the Shares held as at the Redemption
Record Date

“Notice of EGM”:

The notice of extraordinary general meeting accompanying
this Circular“NPAT”:Net profit after tax

“NTA”

:

Net tangible assets“OFAC”:

Officer of Foreign Assets Controls of the United States
Department of Treasury“Offering” or “Company’s
initial public offering”:

The Company’s (a) international placement of 11.2 million
Offering Units to investors, including institutional and otherinvestors in Singapore and outside the United States inreliance on Regulation S and (b) offer of 0.6 million Offering
Units to the public in Singapore for subscription at theOffering Price, subject to and on the terms and conditions set
out in the Prospectus“Offering Price”:

The offering price of S$5.00 per Offering Unit

“Offering Units”:

The 11.8 million Units issued and offered by the Company in
the Offering and the 1,606,000 Units issued by the Company
pursuant to the Over-allotment Option“Original Maximum
Promote Shares”:

The up to 10,401,500 Promote Shares that the Sponsor isentitled to the allotment and issuance of pursuant to thePromote Shares Deed of Undertaking“Other Shareholders’ IPO
Units”:The Units allotted and issued to Shareholders other thanVertex SPV and Venezio at the Company’s initial public
offering“Over-allotment Option”:

The over-allotment option granted by the Company to the
Joint Global Coordinators, Joint Bookrunners and Joint
Underwriters (each as defined in the Prospectus) inconnection with the Offering, which was exercised by Credit
Suisse as the Stabilising Manager in part in respect of
1,606,000 Units (the “Additional Units”) (out of the2,360,000 Units which had been over-allotted in connection
with the Offering) on 15 February 2022 at the Offering Pricesolely for the purpose of covering the over-allotment of Units“Period Under Review”:

The period comprising FY2020, FY2021, FY2022 and 1H
FY202327

DEFINITIONS“Permitted Transferees”:(a) the Company’s officers or directors, any affiliates or family
members of any of the Company’s officers or directors, any
affiliate of the Sponsor or to any member(s) of the Sponsor,
any affiliates of such members and funds and accounts
advised by such members; (b) in the case of an individual, bygift to a member of such individual’s immediate family or to atrust, the beneficiary of which is a member of such individual’s
immediate family, an affiliate of such individual or to acharitable organisation; (c) in the case of an individual, byvirtue of the laws of descent and distribution upon death ofsuch person; (d) in the case of an individual, pursuant to aqualified domestic relations order; (e) by private sales ortransfers made in connection with the consummation of an
initial business combination at prices no greater than theprice at which the securities were originally purchased; (f) in
the event of the Company’s liquidation prior to consummationof the Company’s initial business combination; (g) by virtue ofthe laws of Singapore upon liquidation or dissolution of theSponsor; (h) in the event of the Company’s liquidation,
merger, share capital or capital stock exchange,
reorganisation or other similar transaction which results in allof the Shareholders having the right to exchange their Sharesfor cash, securities or other property subsequent to theCompany’s completion of its initial business combination; or(i) to surrender to the Company for no value for cancellationin connection with the consummation of the Company’s initialbusiness combination“PDPA” or “Personal Data
Protection Act”:

Personal Data Protection Act 2012 of Singapore, as may beamended, varied or supplemented from time to time

“PIPE”:

Private investment in public equity“PIPE Financing”:

Financing by way of strategic placement of new Shares to the
PIPE Investors whether before or after the execution of the
SPA, to be completed contemporaneously with Completion,
pursuant to the PIPE Subscription Agreements“PIPE Investors”:

Private investors who will be subscribing for Base PIPE
Shares pursuant to the terms and conditions of the PIPE
Subscription Agreements“PIPE Shares”:

The Base PIPE Shares and the Special Bonus PIPE Shares“PIPE Subscription
Agreements”:

The subscription agreements for the PIPE Financing enteredinto between the Company and the PIPE Investors, pursuant
to which the PIPE Investors agreed to subscribe for the PIPE
Shares“POFMA”:

Protection from Online Falsehoods and Manipulation Act
2019 of Singapore, as may be amended, varied or
supplemented from time to time28

DEFINITIONS“PPIA”:Act on the Protection of Personal Information of Japan, as
may be amended, varied or supplemented from time to time

“PRC”

:

The People’s Republic of China; for the purpose of thiscircular only, excluding Taiwan, and the special administrative
regions of Hong Kong and Macau and the term “Chinese” hasa correlative meaning“Private Placement
Warrants”:

The up to 20.0 million Warrants to be subscribed by Vertex
SPV pursuant to the Private Placement Warrants Purchase
Agreement, wherein 16.0 million Warrants were purchasedon the close of the Offering and up to 4.0 million Warrants will
be purchased at any time during the period commencing thedate of the close of the Offering to the date of the initialbusiness combination, based on the Warrant Exercise Priceof S$5.75 (subject to adjustment) at a price of S$0.50 per
Warrant, in a private placement that closed concurrently withthe closing of the Offering. As at the Latest Practicable Date,the number of Private Placement Warrants purchased is 16.0
million and to the best of the knowledge of the Company andsubject to Completion, no additional Private Placement
Warrants are intended to be purchased by Vertex SPV“Private Placement
Warrants Purchase
Agreement”:

The private placement warrants purchase agreement dated 6
January 2022 entered into between the Company and theSponsor in relation to the purchase of the Private Placement
Warrants by Vertex SPV“Promote Shares”:

The 10,401,500 Shares to be allotted and issued by theCompany to Vertex SPV upon Completion subject to certain
vesting conditions pursuant to the Promote Shares Deed ofUndertaking“Promote Shares Deed ofUndertaking”:

The deed of undertaking dated 6 January 2022 entered into
between the Company and the Sponsor in relation to theissue and allotment of the Promote Shares to Vertex SPV“Proposed Adoption of theCompany ESOP”:

The proposed adoption of the Company ESOP

“Proposed Adoption of the
EIS”:

The proposed adoption of the EIS“Proposed Adoption of the
New Memorandum andArticles of Association”:

The proposed adoption of the New Memorandum and Articles
of Association“Proposed Allotment andIssuance of the Base PIPE
Shares”:

The proposed allotment and issuance of the Base PIPE
Shares to the PIPE Investors at the Issue Price pursuant to
the terms of the PIPE Subscription Agreements“Proposed Allotment andIssuance of theConsideration Shares”:

The proposed allotment and issuance of the Consideration
Shares to the Vendor (or if the Vendor so nominates, to the
Vendor Shareholders) at the Issue Price

29

DEFINITIONS“Proposed Allotment andIssuance of the Earnout
Shares”:

The proposed allotment and issuance of the Earnout Sharesto the Earnout Shareholders at the Issue Price“Proposed Allotment andIssuance of the EIS
Shares”:

The proposed allotment and issuance of the EIS Shares tothe Key Executives at the Issue Price“Proposed Allotment andIssuance of the ESOP
Shares”:

The proposed allotment and issuance of the ESOP Sharespursuant to the Company ESOP

“Proposed Allotment andIssuance of the Special
Bonus Shares”:

The proposed allotment and issuance of the Special BonusNRS Shares to the Non-Redeeming Shareholders and the
proposed allotment and issuance of the Special Bonus PIPE
Shares to the PIPE Investors at the Issue Price“Proposed Business
Combination”:

The proposed business combination between the Company
and the Target Company by way of an acquisition by theCompany of the entire issued and paid-up share capital of theTarget Company from the Vendor pursuant to the terms andsubject to the conditions of the SPA“Proposed Change of theCompany’s Independent
Auditor”:

The proposed change of the Company’s Independent Auditor
from KPMG LLP to Ernst & Young LLP“Proposed Change ofCompany’s Name”:

The proposed change of name of the Company from “Vertex
Technology Acquisition Corporation Ltd” to “17LIVE Group
Limited”“Proposed Directors” or“Proposed New Board”:

The directors proposed to be appointed to the Board, beingthe
Proposed
Executive
Director,the
Proposed
Non-Executive Directors, and the Proposed Independent
Directors“Proposed Executive
Director”:

Mr. Lien Chien-Lin“Proposed Executive
Officers”:

Mr. Lien Chien-Lin, Mr. Ng Jing Shen and Mr. Kenta Masuda“Proposed Independent
Directors”:

Mr. Tan Hup Foi, Dr. Steve Lai Mun Fook, Mr. Hideto Mizuno
and Ms. Chen Xiuling“Proposed Management
Team”

:

The Proposed Directors and the Proposed Executive Officers“Proposed New Audit
Committee”:

The new audit committee of the Company to be constituted
upon Completion“Proposed New
Nominating Committee”:

The new nominating committee of the Company to beconstituted upon Completion

30

DEFINITIONS“Proposed New
Remuneration Committee”:

The new remuneration committee of the Company to beconstituted upon Completion“Proposed Non-Executive
Directors”:

Mr. Phua Jiexian Joseph and Mr. Akio Tanaka“Proposed Transactions”:

The transactions being tabled for Shareholders’ approval as
set out in the Notice of EGM, including the Proposed
Business Combination, the Proposed Allotment and Issuanceof the Consideration Shares, the Proposed Allotment andIssuance of the Earnout Shares, the Proposed Allotment andIssuance of the Base PIPE Shares, the Proposed Allotment
and Issuance of the Special Bonus Shares, the Proposed
Adoption of the EIS, the Proposed Allotment and Issuance of
the EIS Shares, the Proposed Adoption of the Company
ESOP, the Proposed Allotment and Issuance of the ESOP
Shares, the Proposed Change of the Company’s Name and
the Proposed Adoption of the New Memorandum and Articles
of Association“Prospectus”:

The prospectus dated 13 January 2022 issued by theCompany in connection with the Offering and the Listing“Proxy Form”:

The proxy form in respect of the EGM as set out in thisCircular“PSA”:

Payment Services Act of Japan, as may be amended, variedor supplemented from time to time

“Public Shareholders”:

Shares held by persons other than:(a)directors, CEO, Substantial Shareholders or Controlling
Shareholders of the Company or its subsidiarycompanies;(b)

Associates of the persons in paragraph (a); and(c)founding shareholders and the Management Team of
the Company, and their Associates“Public Warrants”:

Warrants issued to the holders of Shares that comprise theOffering Units, the Cornerstone Units and the Sponsor IPO
Investment Units“Purchase Consideration”:

Up to S$922.9 million (equivalent to approximately US$680.6
million), being the aggregate of (a) S$800.8 million(equivalent to approximately US$590.6 million) and (b) up to
S$122.0 million (equivalent to approximately US$90.0
million), subject to the Financial Targets for Earnout being
achieved

31

DEFINITIONS“Redeeming Shareholders”:

Shareholders who have validly exercised their Redemption
Right (other than Vertex SPV and Venezio, being
Shareholders who are not entitled to exercise their
Redemption Right)“Redeeming Shares”:

Shares in respect of which the relevant Shareholder has
validly exercised their Redemption Right“Redemption”:

An event wherein the Shareholders (save for Vertex SPV and
Venezio) may in accordance with the Memorandum andArticles of Association redeem all or a portion of their Shares
upon the Company’s initial business combination’s
completion at a per-Share price equal to the Redemption
Price“Redemption Completion
Date”

:

8 December 2023

“Redemption Limit”:

A maximum of 15% of the Shares in the aggregate“Redemption Payment
Date”

:

8 December 2023

“Redemption Price”:

The aggregate amount on deposit in the Escrow Accountcalculated as of two Market Days before Completion,
including interest earned on the funds held in the Escrow
Account and not previously released to the Company to pay
the Company’s income taxes or operating expenses, if any,
but net of any taxes payable on the interest earned on thefunds held in the Escrow Account, divided by the number ofoutstanding Shares as at date falling two Market Days before
Completion (which for the avoidance of doubt, includes the
Shares held by Venezio and the Sponsor but not including thePromote Shares)“Redemption Record Date”:

The expected record date for determining the NonRedeeming Shareholders who are entitled to the Special
Bonus NRS Shares and Additional Warrants, being a datethat is two Market Days before the date of the EGM, subject
to changes as may be announced on SGXNET“Redemption Right”:

The right of Shareholders (save for Vertex SPV and Venezio)
to elect to redeem all or a portion of their Shares at aper-Share price equal to the Redemption Price“Redemption Shares”:

The number of new Shares to be allotted and issued upon
redemption of the Warrants on a “cashless basis”

32

DEFINITIONS“Reference Price”:

Following the completion of the Offering and Listing, means
S$5.00, and shall be adjusted proportionately to account for
any changes in the Company’s equity securities by way ofrights issue, sub-division of Shares, combination orreclassificationorthroughmerger,consolidation,
reorganisation, recapitalisation or business combination or by
any other means where the Company shall appoint an
independent financial adviser to consider whether any
adjustment to the prevailing Reference Price is appropriate
and has been proportionately adjusted and if such
independent financial adviser shall determine that any
adjustment is appropriate, the Reference Price shall be
adjusted accordingly“Reference Value”:

The last reported sales price of the Shares for any 20 Market
Days within the 30 Market-Day period ending on the third
Market Day prior to the date on which notice of theredemption is given“Register of Members”:

The register of members of the Company“Remuneration Committee”:

The remuneration committee of the Company as at the Latest
Practicable Date

“Request Form”:

The request form to be submitted by Shareholders who wish
to request for a printed copy of the Circular, to be despatchedto Shareholders on or around the date of this Circular“Restructuring”:

The corporate restructuring to be undertaken by the Target
Company prior to Completion, pursuant to which the 17LIVE
Cayman Shareholders will transfer their respective shares in
17LIVE Cayman to the Vendor in consideration for the
allotment and issuance of shares by the Vendor to the 17LIVE
Cayman Shareholders“Resulting Issuer”:

The post-Proposed Business Combination entity that tradeson the SGX-ST upon Completion“ROC Act”:

Act Governing Relationships between the People of the
Taiwan Area and the Mainland Area of Taiwan and theregulations promulgated thereunder, as may be amended,varied or supplemented from time to time

“RSUs”:

Restricted share units“Sale Shares”:

269,393,579 shares in the capital of the Target Company,
being the aggregate of (a) the 250,481,652 Basic Sale
Shares, (b) the 18,349,125 17LIVE Vested RSUs which havebeen converted into shares in the capital of the Target
Company and (c) all shares allotted and issued by the Target
Company pursuant to the exercise and conversion of the
17LIVE Warrants, being 562,802 shares in the capital of theTarget Company, all of which comprise 100% of the issued
and paid-up share capital of the Target Company

33

DEFINITIONS“SCTA”:

Specified Commercial Transactions Act of Japan, as may beamended, varied or supplemented from time to time

“Securities Account”:

The securities account maintained by a depositor with CDP
but does not include a securities sub-account maintained witha depository agent“Securities and Futures
Act” or “SFA”:

Securities and Futures Act 2001 of Singapore, as may by
amended, varied or supplemented from time to time

“Settlement Date”:

The date and time on which the PIPE Shares are issued,
which is to be decided and agreed upon between the PIPE
Investor and the Company and shall be on or around theCompletion Date

“SFR”

:

Securities and Futures (Offers of Investments) (Securities
and Securities Based Derivatives Contracts) Regulations
2018, as may by amended, varied or supplemented from time
to time“SGXNET”:

Singapore Exchange Network, the corporate announcement
system maintained by the SGX-ST for the submission ofannouncements by listed companies“Share Exchange”:

The share exchange in relation to Share Exchange
Agreement“Share Exchange
Agreement”:

The share exchange agreement entered into by the Target
Company, its shareholders named therein and the holders ofoutstanding warrants issued by the Target Company named
therein dated 7 November 2023

“Share Redemption Form”:

The share redemption form to be submitted by Shareholders
in order to exercise their Redemption Right, to be despatchedto Shareholders on or around the date of this Circular“Shareholder Letter”:

The letter to Shareholders dated 9 November 2023 directing
Shareholders on where to access, view, download and print
the Circular, to be despatched to Shareholders on or aroundthe date of this Circular“Shareholders”:

Registered holders of Shares in the Register of Members,
except that where the registered holder is CDP, the term
“Shareholders” shall, in relation to such shares, mean the
Depositors whose direct Securities Accounts maintained with
CDP are credited with Shares“Shares”:

Ordinary shares in the capital of the Company“Singapore Companies
Act”:

Companies Act 1967 of Singapore, as may be amended,varied or supplemented from time to time“Singapore Take-over
Code”

:

The Singapore Code on Take-overs and Mergers, as may beamended, varied or supplemented from time to time34

DEFINITIONS“Southeast Asia”:

Singapore, Malaysia, Thailand, Indonesia and the Philippines“SPA” or “Sale andPurchase Agreement”:

The conditional sale and purchase agreement dated
2 October 2023 (as may be amended, supplemented, orotherwise modified from time to time) entered into among theCompany, the Vendor, the Target Company, the Management
Warrantors and the Founder in relation to the Proposed
Business Combination“SPAC”:

Special purpose acquisition company“Special Bonus NRS
Shares”:

The new Shares to be allotted and issued pursuant to
Non-Redeeming Shareholders pursuant to the Special Bonus
Scheme“Special Bonus PIPE
Shares”:

The new Shares to be allotted and issued to PIPE Investors
pursuant to the Special Bonus Scheme“Special Bonus Scheme”:

The scheme for the allotment and issuance of 0.1 new
Shares, allotted as fully paid up and issued to (a) the
Non-Redeeming Shareholders for every existing Share heldby the Non-Redeeming Shareholders as at the Redemption
Record Date (rounded downwards to the nearest integer),and (b) the PIPE Investors for every Base PIPE Sharesubscribed for by the PIPE Investors pursuant to the terms
and conditions of the PIPE Subscription Agreements(rounded downwards to the nearest integer)“Special Bonus Shares”:

The Special Bonus NRS Shares and the Special Bonus PIPE
Shares“Sponsor IPO Investment
Units”:The 6.0 million Units allotted and issued by the Company toVertex SPV at the Offering Price, at the same time but
separate from the Offering pursuant to the Sponsor
Subscription Agreement“Sponsor Subscription
Agreement”:

The securities subscription agreement dated 6 January 2022
entered into between the Company and the Sponsor in
relation to the issue and allotment of the Sponsor IPO
Investment Units by Vertex SPV

“SPR”

:

Singapore permanent residents

“SRS”

:

Supplementary Retirement Scheme“SRS Investors”:

Shareholders who have purchased Shares using their funds
in the SRS“SRS Operators”:

Approved banks in which SRS Investors hold their accounts
under the SRS“Subsidiary Holdings”:

Shares referred to in Sections 21(4), 21(4B), 21(6A) and21(6C) of the Singapore Companies Act

35

DEFINITIONS“Substantial Shareholder”:

A person which has an interest in one or more voting sharesof a company and the total votes attached to such share(s),are not less than 5% of the total votes attached to all thevoting shares in the company“Summary Valuation
Letter”:

The summary valuation letter prepared by the Independent
Business Valuer in respect of the independent businessvaluation of the Target Company as set out in Appendix M tothis Circular“Target Company’sbusiness”:

The Target Company’s business in live streaming, details of
which are set out in Section 14 titled “Information on theTarget Company” of this Circular“Target Group’s
management”:

The executive directors and executive officers of the Target
Company as at the date of this Circular, including Mr. Phua
Jiexian Joseph, Mr. Lien Chien-Lin, Mr. Kenta Masuda and
Mr. Ng Jing Shen

“Target Shareholders’
Agreement”:

The amended and restated shareholders’ agreement enteredinto by the Target Company and the shareholders of theTarget Company named therein dated 4 April 2023

“TBA”

:

Telecommunications Business Act of Japan, as may beamended, varied or supplemented from time to time

“Trading Suspension”:

A period of four Market Days commencing on 28 November
2023, 9.00 a.m., during which trading of the Company’s
securities will be suspended“Transfer of NEHK”:

The acquisition of the 100% equity interests in NEHK by
17LIVE Japan from NEGH

“Treasury Shares”:

Has the meaning ascribed to it in Section 4 of the Singapore
Companies Act“Units”:

Units in the Company, comprising one ordinary share and 0.3
of one Warrant per Share issued at the completion of theOffering, with an additional right to the Additional Warrants
which will be issued to the Non-Redeeming Shareholders andVertex SPV“U.S.“:The United States of America, its territories and possessions,
any state of the United States and the District of Columbia“U.S. Federal Reserve”:

The Federal Reserve System of the U.S.

“V-Liver Operating
Revenue”:

With respect to a financial period, the operating revenue of
the Target Group attributable to the V-Liver business,
including, without limitation, net revenue generated from live
streaming, games, live commerce, events and concerts andmerchandising featuring V-Livers, as shown in the audited orreviewed consolidated financial statements of the Target
Group for that applicable financial period

36

DEFINITIONS“Valuation Benchmark
Date”

:

30 June 2023

“Valuation Report”:

The full valuation report dated 9 November 2023 prepared by
the Independent Business Valuer in respect of the
independent business valuation of the Target Company“Vendor and Target
Company Transaction
Expenses”:

Any out-of-pocket fees and expenses payable by the Vendor,
the Target Company or any of their respective subsidiaries oraffiliates (whether or not billed or accrued for) as a result of orin connection with the negotiation, documentation andconsummation of the Proposed Business Combination andthe transactions contemplated in the SPA or any of the otherTransaction Documents (as defined in the SPA), including (a)all fees, costs, expenses, brokerage fees, commissions,finders’ fees and disbursements of financial advisers,
investment banks, data room administrators, attorneys,accountants and other advisers and service providers,
including consultants and public relations firms, and (b) any
and all filing fees payable by the Vendor, the Target Company
or any of their respective subsidiaries or affiliates to any
governmental authority in connection with the Proposed
Business Combination, the transactions contemplated in the
SPA or any of the other Transaction Documents (as defined in
the SPA)“Vendor Shareholders”:

The holders of shares in the share capital of the Vendor after
the Restructuring“Waived Promote Shares”:

The number of Promote Shares that the Sponsor waives its
right to the allotment and issuance of pursuant to the Deed of
Waiver“Warrant Agreement”:

The warrant agency agreement and deed poll dated
6 January 2022 entered into between the Company and theWarrant Agent appointing, amongst others, the Warrant
Agent, as the same may be modified from time to time by theparties thereto, and includes any other agreement (whether
made pursuant to the terms of the Warrant Agreement orotherwise) appointing further or other warrant agents oramending or modifying the terms of any such appointment“Warrant Conditions”:

The terms and conditions in respect of the Warrants pursuant
to the Warrant Agreement as detailed in the section titled“Appendix E – Terms and Conditions of the Warrants” of theProspectus“Warrant Exercise Form”:

The warrant exercise forms for scripless Warrants and scripbased Warrants to be completed and submitted by
Warrantholders to the Warrant Agent for the exercise of their
Warrants for Shares, copies of which will be published on the
Resulting Issuer’s corporate website post-Completion

37

DEFINITIONS“Warrant Exercise Period”:

The period commencing on the later of: (a) 30 days after thecompletion of the Company’s initial business combination; or(b) 12 months from the close of the Offering and terminatingon the Warrant Expiration Date

“Warrant Exercise Price”:

S$5.75 payable for each whole Share on the exercise of a
Warrant, subject to the adjustments as described in the
Warrant Conditions“Warrant Expiration Date”:

The earlier to occur of: (a) 5:00 p.m., Singapore time on thedate that is five years after the date on which the Company
completes its initial business combination; (b) the Company’s
Liquidation; or (c) (other than with respect to the Private
Placement Warrants to the extent then held by Vertex SPV or
its Permitted Transferees), 5:00 p.m., Singapore time on the
Warrant Redemption Date as provided in the Warrant
Conditions“Warrant Redemption
Date”

:

The date fixed by the Company where the Company elects toredeem the Warrants“Warrantholders”:

Registered holders of the Warrants except that where theregistered holder is CDP, the term “Warrantholders” shallmean the Depositors whose Securities Accounts with CDP
are credited with the Warrants“Warrants”:

Warrants in registered form issued by the Company and,
where the context so admits, such additional warrants as may
be required or permitted to be issued by the Company
pursuant to the terms and conditions of the Warrant
Agreement (any such additional warrants to rank pari passu
with the warrants issued in connection with the Offering and
the Private Placement Warrants Purchase Agreement and forall purposes to form part of the same series), each such
Warrant entitling its holder to subscribe for one converted
share at the Warrant Exercise Price during the Warrant
Exercise Period, subject to the Warrant Conditions

Currencies and Units of Measurement
“JPY”

:

Japanese yen“HK$” or “HKD”:

Hong Kong dollars

“INR”

:

Indian rupees“NT$” or “NTD”:

New Taiwan dollars

“RMB”

:

Renminbi“S$” or “SGD”:

Singapore dollars and cents“sq m”:

Square metres

38

DEFINITIONS“US$” or “USD”:

United States dollars“%” or “per cent.”:

Per centum or percentage

Any capitalised terms in Section 10 of this Circular relating to the EIS which are not defined in thissection of this Circular shall have the meanings ascribed to them as stated in Appendix I to thisCircular.
Any capitalised terms in Section 12 of this Circular relating to the Company ESOP which are notdefined in this section of this Circular shall have the meanings ascribed to them as stated inAppendix H to this Circular.
The terms “subsidiary”, “subsidiary entity”, “related corporation”, “related entity” and“substantial shareholder” shall have the meaning ascribed to them in the SFA, SFR, theSingapore Companies Act and/or the Mainboard Rules, as the case may be respectively.
The term “entity” includes a corporation, an unincorporated association, a partnership and thegovernment of any state, but does not include a trust as defined in the SFA.
The terms “depositor”, “depository agent” and “depository register” shall have the same
meanings ascribed to them respectively in Section 81SF of the SFA.
Any reference in this Circular to any enactment is a reference to that enactment for the time being
amended or re-enacted. Any word defined under the Mainboard Rules, the Singapore Companies
Act, SFA, SFR, the Singapore Take-over Code or any statutory modification thereof and used inthis Circular shall, where applicable, have the same meaning ascribed to it under the Mainboard
Rules, the Singapore Companies Act, SFA, SFR, the Singapore Take-over Code or any statutory
modification thereto, as the case may be, unless the context requires otherwise.
Any reference in this Circular to “Rule” or “Chapter” is a reference to the relevant rule or chapter
in the Mainboard Rules, unless otherwise stated.
Any reference in this Circular to Shares and/or new Shares being issued and allotted to a person
includes issuance and allotment to CDP for the account of that person.
Any reference to a time of day in this Circular shall be a reference to Singapore time, unlessotherwise stated.
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. Unless the context otherwise requires, any references to persons shall include
individuals, bodies corporate (wherever incorporated), unincorporated associations andpartnerships.
The headings in this Circular are inserted for convenience only and shall be ignored in the eventof inconsistency with this Circular.

39

DEFINITIONS
Any discrepancies between the figures listed and the totals thereof are due to rounding.
Accordingly, figures shown as totals in this Circular may not be an arithmetic aggregation of the
figures that precede them. Unless otherwise provided in this Circular, all foreign currency
conversions are calculated based on the following exchange rates, being exchange rates as at theLatest Practicable Date (save for the “SGD:USD” exchange rate, which is the exchange rate usedin the SPA and not the exchange rate as at the Latest Practicable Date):
SGD:USD1:

1.356

SGD:JPY:110.38

SGD:HKD:

5.72

SGD:NTD:

23.73

SGD:INR

:

60.91

1

For reference only, the “SGD:USD” exchange rate as at the Latest Practicable Date is 1.37.

40

GLOSSARY OF TECHNICAL TERMS
To facilitate a better understanding of the Target Company, the following glossary provides a
description of some of the technical terms and abbreviations commonly used in the Target
Company’s industry. The terms and their assigned meanings may not correspond to standard
industry or common meanings or usages of these terms.
“17LIVE”:

The live streaming platform created and operated by theTarget Company under the brand name “17LIVE”
accessible via internet browsers or a mobile application
named “17LIVE”

“AI”

:

Artificial intelligence“AMPU”:

Average monthly paying users within a given period“Android”:

Android Operating System, the mobile operating systemdeveloped and operated by Google

“APK”

:

Android Package“Apps” or “applications”:

Mobile applications

“AR”

:

Augmented reality“Army subscriber”:

A user of 17LIVE who pays a monthly subscription fee toenjoy special privileges“Asia”:

Japan, Taiwan, Hong Kong and Southeast Asia

“Average Daily View
Duration Per DAU”:

Average duration, in minutes, that a DAU views content
during a specified day“Average Revenue Per
Spending User” or“ARPPU”:

Average monthly spend revenue per spender“Average Revenue Per
User” or “ARPU”:

Average monthly spend revenue per user

“B2B”

:

Business-to-business“B2B2C”:

Business-to-business-to-consumer“CAGR” or “Compound
Annual Growth Rate”:

Annual growth rate over a specified period of time

“CDN”

:

Content Distribution Network“Contracted MAS”:

A MAS who has entered into a contract with the Target
Group as of that specified period

41

GLOSSARY OF TECHNICAL TERMS“Contracted Streamer”:

A live streamer, identified by a unique streamer ID, who hasentered into a contract with the Target Group as of thatspecified period; for the avoidance of doubt, “Contracted
Streamer” includes human voice actors behind V-Livers“COVID-19 pandemic”:

The pandemic caused by the Coronavirus disease 2019,an infectious disease caused by the SARS-CoV-2 virus“daily active user” or
“DAU”

:

A User, identified by a unique ID, who has logged into
17LIVE at least once during the specified day“EBITDA”:

Earnings before
amortisation“Game Penetration Rate”:

Game spenders as a percentage of total spenders on
17LIVE“Game spender”:

A User, identified by a unique ID, who has spent virtual
points on game activities within a specified month“Games”:

Games offered within 17LIVE“Google Play”:

Google Play store, the application store developed andoperated by Google“HandsUp”:

A platform in Japan that allows merchants to sell theirproducts through live streaming“in-app games”:

Games offered within 17LIVE“iOS App Store”:

The application store developed and operated by Apple“Liver”:

Live streamer, a type of influencer which creates online
content and broadcasts real time through a live stream toan audience“monthly active streamer”
or “MAS”:

A live streamer, identified by a unique streamer ID, who has
conducted a stream on 17LIVE at least once during thespecified month“monthly active user” or
“MAU”

:

A User, identified by a unique ID, who has logged into
17LIVE at least once during the specified month“OrderPally”:

A B2B live commerce matching and order management
SaaS platform connecting merchants and users in Taiwan

“PGC”

:

Professionally generated content“PUGC”:

Professionally curated user generated content

42interest,

taxes,

depreciationandGLOSSARY OF TECHNICAL TERMS“Quality MAU”:

A User, identified by a unique ID, who has consecutively
viewed a specified live streamer’s content over 320 times
in total; a user’s cumulative view record will be reset if they
miss five consecutive live streams from the specified live
streamer and only a stream that lasts more than 30 minutes
will be considered valid and will count towards the viewing
total

“R&D”

:

Research and development

“ROI”

:

Return on investment

“RPG”

:

Role playing games“S+ latency technology”:

The technology that balances the connection loads among
computers that perform data computation at the edge of a
network“SaaS”:

Software as a service“spender”:

A user, identified by a unique ID, who has spent virtual
points on 17LIVE within a specified month“Spend Rate”:

Spenders as a percentage of MAU“Spend revenue”:

Total virtual points spent by all spenders on 17LIVE withina specified month“Users”:

Users of the Target Group’s platforms, including 17LIVE,
HandsUp, OrderPally and Wave

“V-Liver” or “V-Liver live
streamer”:

Virtual live streamer, a type of live streamer which
comprises of computer-generated characters designed toresemble real people“V-Liver proprietary IP”:

The intellectual property rights in relation to V-Liver“V-Liver MAS”:

A Contracted Streamer, identified by a unique streamer ID,
who has streamed at least one V-Liver broadcast during
the specified month“V-Liver Spend Rate”:

V-Liver spenders as a percentage of V-Liver viewers“V-Liver spender”:

A User, identified by a unique ID, who has spent virtual
points on V-Livers within a specific month“V-Liver viewer”:

A User, identified by a unique ID, who has watched at least
one V-Liver stream during the specified month43

GLOSSARY OF TECHNICAL TERMS“virtual gifting” or “virtual
gifts”:The gifting of virtual gifts which are purchased using virtual
points in the context of live streaming“virtual point”:

The virtual currency used on 17LIVE, enabling users toengage with specific features, including (i) virtual gifting,where virtual points serve as a medium for users to acquire
virtual gifts on 17LIVE. These virtual gifts can subsequently
be gifted to live streamers or users within the 17LIVE
community; and (ii) games as certain games or interactive
activities on 17LIVE may require the use of virtual points toparticipate“Wave”:

An audio-centric live streaming and social platform
launched by the Target Group44

CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS
All statements contained in this Circular, statements made in the press releases and oral
statements that may be made by the Company, the Target Group, the Enlarged Group, the Vendor
or each of their respective directors, key executives or employees acting on the Company’s or theTarget Group’s or the Enlarged Group’s or the Vendor’s behalf, that are not statements ofhistorical fact, constitute “forward-looking statements”. You can identify some of these statements
by words that have a bias towards, or are forward-looking such as “anticipate”, “believe”, “could”,“estimate”, “expect”, “forecast”, “if”, “intend”, “may”, “plan”, “possible”, “probable”, “project”, “will”,“would” and “should” or similar words. However, you should note that these words are not theexclusive means of identifying forward-looking statements. All statements regarding theCompany’s, the Target Group’s, the Enlarged Group’s and the Vendor’s expected financial
position, business strategies, plans and prospects are forward-looking statements.
These forward-looking statements, including without limitation, statements as to:•revenue and profitability;•

trends in demand and costs;•

expected industry prospects and trends;•

planned strategy and anticipated expansion plans; and•any other matters discussed in this Circular,

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 theCompany’s, the Target Group’s, the Enlarged Group’s and the Vendor’s actual future 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, inter alia, the following:(i)changes in political, social and economic conditions, the regulatory environment, laws andregulations and interpretation thereof in the jurisdictions where the Enlarged Group conducts
business or expects to conduct business;(ii)changes in currency exchange rates;(iii) changes in interest rates;(iv) the risk that the Enlarged Group may be unable to realise its anticipated growth strategies
and expected internal growth;(v)changes in customers’ preferences and needs;(vi) changes in competitive conditions and the Enlarged Group’s ability to compete under suchconditions;(vii) changes in the Enlarged Group’s future capital needs and the availability of financing andcapital to fund such needs; and(viii) other factors whether within or beyond the Enlarged Group’s control.

45

CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS
Some of these risk factors are discussed in greater detail in Section 18 titled “Management’s
Discussion and Analysis of Results of Financial Position and Results of Operations of the Target
Group” and Section 16 titled “Risk Factors” of this Circular. All forward-looking statements by or
attributable to the Company, the Target Group, the Enlarged Group and the Vendor, or persons
acting on the Company’s, the Target Group’s, the Enlarged Group’s or the Vendor’s behalf,contained in this Circular are expressly qualified in their entirety by such facts. These
forward-looking statements are applicable only as of the date of this Circular.
Given the risks and uncertainties that may cause the Company’s, the Target Group’s, the Enlarged
Group’s and the Vendor’s actual future results, performance or achievements to be materiallydifferent from that expected, expressed or implied by the forward-looking statements in thisCircular, you are advised not to place undue reliance on these statements. Neither the Company,
the Target Group, the Enlarged Group, the Vendor and the Joint Financial Advisers nor any otherperson represents or warrants that the Company’s, the Target Group’s, the Enlarged Group’s andthe Vendor’s actual future results, performance or achievements will be as discussed in thosestatements.
The Company’s, the Target Group’s, the Enlarged Group’s and the Vendor’s actual future results
may differ materially from those anticipated in these forward-looking statements as a result of therisks faced by the Company, the Target Group, the Enlarged Group and the Vendor. The Company,
the Target Group, the Enlarged Group, the Vendor and the Joint Financial Advisers disclaim any
responsibility to update or publicly announce any revisions to any of those forward-looking
statements to reflect future developments, events or circumstances, even if new information
becomes available or other events occur in the future. The Company, the Target Group, theEnlarged Group and the Vendor are however, subject to the provisions of the SFA and theMainboard Rules regarding corporate disclosure.
MARKET AND INDUSTRY DATAThis Circular contains and refers to the IMR Report regarding the market and the competitiveenvironment in which the Target Group operates. Please refer to Appendix F titled “Independent
Market Research Report” of this Circular for the IMR Report. The purpose of the IMR Report is toprovide a true and fair view of the industry in which the Target Group operates in and its
competitive position in these markets. Projected data in the IMR Report was forecasted from
historical data analysis plotted against macroeconomic data with reference to specificindustry-related factors, within the limitations of, among others, secondary statistics and primaryresearch, and it does not purport to be exhaustive. The Company, the Target Group, the Sole
Issue Manager and the Joint Financial Advisers have not independently verified the industry dataand other information on which any third party research, including the IMR Report, is based or theexternal sources on which the Target Group’s own estimates are based. Accordingly, theCompany, the Target Group, the Sole Issue Manager and the Joint Financial Advisers accept no
responsibility for the accuracy of information presented in this Circular from third party studies on
the industry environment, development, growth rates, trends and competitive conditions (otherthan the correct replication of such information) or the accuracy of the information on which theTarget Group’s own estimates are based. Market data and statistics are inherently predictive andspeculative and may not necessarily reflect actual or future market conditions and may notnecessarily be indicative of the Target Group’s future operations. The use of such data involves
risks and uncertainties and is subject to change based on various factors, including those
discussed immediately above. There is no assurance that the business strategies and growthprospects of the Target Group will materialise.

46

INDICATIVE TIMETABLE
The following indicative timetable assumes that approval for all the resolutions proposed at the
EGM is obtained on 1 December 2023 and Completion takes place by 8 December 2023.
Last date and time to purchase Shares to beentitled to the Special Bonus NRS Shares and the
Additional Warrants
Last date and time to purchase Shares to beentitled to the Redemption Right:

27 November 2023, before close of
trading at 5.00 pm

Commencement of the Trading Suspension:

28 November 2023, 9.00 a.m.

Last date and time to elect for Redemption andsubmit the Share Redemption Form:

28 November 2023, 2.00 p.m.

Last date and time for lodgement of Proxy Form:

29 November 2023, 2.00 p.m.

Redemption Record Date:

29 November 2023

Date and time of EGM and announcement of levelof Redemption:

1 December 2023, 2.00 p.m.

Resumption of trading on the SGX-ST (after liftingof the Trading Suspension):

4 December 2023, 9.00 a.m.

Expected Completion Date:

8 December 2023

and:

8 December 2023

Expected date and time of the crediting of theConsideration Shares, Base PIPE Shares and theSpecial Bonus PIPE Shares:

8 December 2023, before market
opens at 9.00 a.m.

Expected date and time of the crediting of theSpecial Bonus NRS Shares and the Additional
Warrants to Non-Redeeming Shareholders and thecrediting of the Additional Warrants to Vertex SPV:

8 December 2023, before market
opens at 9.00 a.m.

Expected trading date under the new name“17LIVE Group Limited”:

8 December 2023

Expected Redemption Payment
Redemption Completion Date

Date

The dates set out in the above timetable are indicative only and may be subject to change. The
Company will make further announcements on the SGXNET on the exact dates and times of such
events.

47

LETTER TO SHAREHOLDERSVERTEX TECHNOLOGY ACQUISITION CORPORATION LTD(Incorporated as an exempted company in the Cayman Islands)(Company Registration No. 378671)

Board of Directors:

Registered Office:

Mr. Chua Kee Lock (Non-Executive Chairman)
Mr. Jiang Honghui (Executive Director and CEO)Ms. Anupama Sawhney (Non-Executive Director)
Dr. Steve Lai Mun Fook (Independent Director)
Mr. Low Seow Juan (Independent Director)
Mr. Tan Hup Foi (Independent Director)

c/o Maples Corporate Services Limited
PO Box 309
Ugland House
Grand Cayman
KY1-1104
Cayman Islands

LETTER TO SHAREHOLDERS
Date: 9 November 2023
To:

The Shareholders of Vertex Technology Acquisition Corporation Ltd

Dear Sir/Madam
1.

PROPOSED BUSINESS COMBINATION BETWEEN THE COMPANY AND 17LIVE INC.
BY WAY OF AN ACQUISITION BY THE COMPANY OF THE ENTIRE ISSUED AND
PAID-UP SHARE CAPITAL OF 17LIVE INC. FROM THE VENDOR FOR THE PURCHASECONSIDERATION;

2.

PROPOSED ALLOTMENT AND ISSUANCE OF 160,162,651 CONSIDERATION SHARESAT THE ISSUE PRICE OF S$5.00 IN PARTIAL SATISFACTION OF THE PURCHASECONSIDERATION FOR THE PROPOSED BUSINESS COMBINATION;

3.

PROPOSED ALLOTMENT AND ISSUANCE OF UP TO 24,408,000 EARNOUT SHARESAT THE ISSUE PRICE OF S$5.00 TO THE EARNOUT SHAREHOLDERS IN PARTIAL
SATISFACTION OF THE PURCHASE CONSIDERATION FOR THE PROPOSEDBUSINESS COMBINATION, SUBJECT TO THE SATISFACTION OF THE FINANCIAL
TARGETS FOR EARNOUT;

4.

PROPOSED ALLOTMENT AND ISSUANCE OF UP TO 2,000,000 BASE PIPE SHARESAT THE ISSUE PRICE OF S$5.00 TO THE PIPE INVESTORS;5.

PROPOSED ALLOTMENT AND ISSUANCE OF UP TO 3,760,600 SPECIAL BONUS
SHARES AT THE ISSUE PRICE OF S$5.00 TO THE NON-REDEEMINGSHAREHOLDERS AND THE PIPE INVESTORS;6.

PROPOSED ADOPTION OF THE EXECUTIVE INCENTIVE SCHEME;7.

PROPOSED ALLOTMENT AND ISSUANCE OF UP TO 2,550,000 EIS SHARES AT THE
ISSUE PRICE OF S$5.00 TO THE KEY EXECUTIVES, SUBJECT TO THE SATISFACTION
OF THE FINANCIAL TARGETS FOR EIS;

8.

PROPOSED ADOPTION OF THE COMPANY EMPLOYEE SHARE OPTION PLAN;

48

LETTER TO SHAREHOLDERS
9.

PROPOSED ALLOTMENT AND ISSUANCE OF UP TO 2,114,891 ESOP SHARESPURSUANT TO THE COMPANY EMPLOYEE SHARE OPTION PLAN;

10.

PROPOSED CHANGE OF THE COMPANY’S NAME TO “17LIVE GROUP LIMITED”;

11.

PROPOSED ADOPTIONASSOCIATION;

12.

PROPOSED CHANGE OF THE COMPANY’S INDEPENDENT AUDITOR;13.

PROPOSED APPOINTMENT OF MR. PHUA JIEXIAN JOSEPH AS A NEW DIRECTOR
UPON COMPLETION;

14.

PROPOSED APPOINTMENT OF MR. LIEN CHIEN-LIN AS A NEW DIRECTOR UPONCOMPLETION;

15.

PROPOSED APPOINTMENT OF MR. AKIO TANAKA AS A NEW DIRECTOR UPONCOMPLETION;

16.

PROPOSED APPOINTMENT OF MR. HIDETO MIZUNO AS A NEW DIRECTOR UPONCOMPLETION; AND

17.

PROPOSED APPOINTMENT OF MS. CHEN XIULING AS A NEW DIRECTOR UPONCOMPLETION.

1.

INTRODUCTION

OF

THE

NEW

MEMORANDUM

AND

ARTICLESOF

On 2 October 2023, the Company announced that it had, on the same day, entered into theSale and Purchase Agreement with the Vendor and the Warrantors in relation to the
Proposed Business Combination between the Company and the Target Company by way ofan acquisition by the Company of 100% of the issued and paid-up share capital of theTarget Company from the Vendor for the Purchase Consideration, to be satisfied by (a) the
allotment and issuance of the Consideration Shares at the Issue Price to the Vendor (or, if
the Vendor so nominates, to the Vendor Shareholders) and (b) subject to the satisfaction of
the Financial Targets for Earnout, the allotment and issuance of the Earnout Shares at theIssue Price to the Earnout Shareholders.
Based on the foregoing, the Proposed Business Combination will result in a reverse
takeover of the Company as defined under Chapter 10 of the Mainboard Rules. In
accordance with Chapter 10 of the Mainboard Rules, the Proposed Business Combination
will be subject to, amongst others, the approval of the Shareholders at the EGM to beconvened.
In connection with the Proposed Business Combination, the Company has applied forwaivers from compliance from specific provisions of the Mainboard Rules and has on 8
November 2023 been granted certain waivers. Please refer to Section 2.2 titled“Submissions to the SGX-ST – Waiver from Compliance with Specific Provisions of the
Mainboard Rules” of this Circular for details.
The purpose of this Circular is to provide you with information relating to and to seek yourapproval for the Proposed Transactions at the forthcoming EGM. Specifically, approvals by
way of ordinary resolution will be sought for the Proposed Business Combination, theProposed Allotment and Issuance of the Consideration Shares, the Proposed Allotment andIssuance of the Earnout Shares, the Proposed Allotment and Issuance of the Base PIPE
Shares, the Proposed Allotment and Issuance of the Special Bonus Shares, the Proposed
49

LETTER TO SHAREHOLDERS
Adoption of the EIS, the Proposed Allotment and Issuance of the EIS Shares, the Proposed
Adoption of the Company ESOP and the Proposed Allotment and Issuance of the ESOP
Shares, and approvals by way of special resolution will be sought for the Proposed Changeof the Company’s Name and the Proposed Adoption of the New Memorandum and Articles
of Association. In addition, approval by way of ordinary will be sought for the Proposed
Change of the Company’s Independent Auditor.
A copy of the Notice of EGM is provided with this Circular. Shareholders should note thatcertain of the resolutions to be presented at the EGM are conditional upon the passing ofcertain other resolutions. Shareholders are advised to refer to Section 3.13 titled “Summaryof the Proposed Transactions – Inter-conditionality of Resolutions” of this Circular for further
details on the inter-conditionality of these resolutions.
The Company has appointed DBS as its Sole Issue Manager in respect of the Proposed
Transactions and DBS and UBS as its Joint Financial Advisers in respect of the Proposed
Transactions and its Joint Placement Agents in respect of the PIPE Financing.
This Circular has been prepared solely for the purposes set out herein and may not be
relied upon by any persons (other than the Shareholders to whom this Circular is
despatched by the Company) or for any other purpose.
The SGX-ST assumes no responsibility for the accuracy of any of the statements
made, reports contained, or opinions expressed in this Circular.
2.

SUBMISSIONS TO THE SGX-ST

2.1

Approval-in-principle
An application was made to the SGX-ST for the approval of the listing of and quotation for
the Consideration Shares, the Earnout Shares, the EIS Shares, the ESOP Shares and theSpecial Bonus Shares.
On 8 November 2023, the SGX-ST granted their approval-in-principle for the listing of andquotation for up to 194,996,142 new Shares (being the Consideration Shares, the Earnout
Shares, the EIS Shares, the ESOP Shares and the Special Bonus Shares) on the
Mainboard of the SGX-ST, subject to, inter alia, the following conditions:(a)compliance with the Exchange’s listing requirements;(b)

Shareholders’ approval being obtained for the Proposed Business Combination andfor all other resolutions set out in the Notice of EGM;

(c)compliance with the shareholding spread requirements under Rule 210(1)(a) of the
Mainboard Rules;(d)compliance with Rules 113(2) and 210(5)(a) of the Mainboard Rules which require
that:
(i)

for two years after listing or such other time frame imposed by the Exchange, theResulting Issuer must prominently include a statement that the reverse take-over50

LETTER TO SHAREHOLDERS
of its Shares was sponsored by DBS in all announcements made by it (onSGXNET or otherwise) and in all information documents issued by it to
Shareholders; and
(ii)

(e)

as a pre-quotation disclosure requirement, the Resulting Issuer must release astatement via SGXNET or in this Circular identifying for each Proposed Director,
whether the person has prior experience as a director of an issuer listed on the
Exchange or if he has other relevant experience, and if so, provide details of his
directorships and other relevant experience. If the Proposed Director has no priorexperience as a director of an issuer listed on the Exchange and has no otherrelevant experience, the Resulting Issuer must confirm that (A) the person has
undertaken training as prescribed by the Exchange; or (B) as stated in PracticeNote 2.3 of the Mainboard Rules that such Proposed Director will attend the
mandatory training by the end of the first year of the Resulting Issuer’s listing;submission of the following documents:(i)a written undertaking from the Resulting Issuer that reviews by the Proposed
New Board or the relevant committee of the Resulting Issuer’s key financial,
operational, compliance and information technology risk areas and the outcomeof these reviews must be disclosed in the annual report or where the findings arematerial, immediately announced via SGXNET;(ii)

a written undertaking by the Resulting Issuer of the following:(A)

the commissioning of an annual internal controls audit by a suitable andqualified professional accounting firm until such time the Proposed New Audit
Committee is satisfied that the Resulting Issuer’s internal controls are robustand effective enough to mitigate the Resulting Issuer’s internal control
weaknesses. Prior to the decommissioning of this annual audit, the Proposed
New Board is required to report to the Exchange on how the key internal
control weaknesses have been rectified, and the basis for the decision todecommission the annual internal controls audit;(B)thereafter, such audits may be initiated by the Proposed New Audit
Committee as and when it deems fit to satisfy itself that the Resulting Issuer’s
internal controls remain robust and effective; and(C) upon completion of the internal controls audit, appropriate disclosure must be
made via SGXNET on any material, price-sensitive internal controls
weaknesses and any follow-up to be taken by the Proposed New Board; and(f)various other undertakings, confirmations and documents from the Resulting Issuer,
the Sole Issue Manager and/or the Resulting Issuer’s directors and executive officers.

The approval in-principle granted by the SGX-ST for the listing of and quotation for theConsideration Shares, the Earnout Shares, the Special Bonus Shares, the EIS Shares andthe ESOP Shares is not an indication of the merits of the Consideration Shares, the Earnout
Shares, the Special Bonus Shares, the EIS Shares and the ESOP Shares, the Company,
the Target Group or the Enlarged Group.

51

LETTER TO SHAREHOLDERS
The application for the listing of and quotation for the PIPE Shares on the Mainboard of the
SGX-ST will be submitted in due course.
For completeness, the Company had obtained the conditional approval of the SGX-ST forthe listing of and quotation for up to 22,800,000 Public Warrants on 24 December 2021,
subject to the conditions set out in the SGX-ST’s letter dated 24 December 2021, all ofwhich have been fulfilled prior to the Listing.
2.2

Waiver from Compliance with Specific Provisions of the Mainboard Rules
Waiver from Compliance with Rule 609(b) of the Mainboard Rules
Pursuant to Rule 609(b) of the Mainboard Rules, the pro forma income statement orstatement of comprehensive income is required to be presented for the latest three financial
years and for the most recent interim period as if the restructured group had been in
existence at the beginning of the period reported on.
The Company applied to the SGX-ST for a waiver from the requirement under Rule 609(b)of the Mainboard Rules for the proforma income statement or statement of comprehensive
income for the latest three financial years and for the most recent interim period to be
included in this Circular. Instead, the Company proposed to include the proforma income
statements of comprehensive income for only the latest financial year (i.e. FY2022) and forthe most recent interim period (i.e. 1H FY2023), with relevant adjustments to reflect the
impact of the proposed Enlarged Group structure, as if the Proposed Business Combination
had been completed as of the beginning of the earliest period presented (i.e. 1 January2022), and to include the proforma statement of financial position as of the end of the latest
financial year (i.e. FY2022) and the most recent interim period (i.e. 1H FY2023), with
relevant adjustments to reflect the impact of the proposed Enlarged Group structure, as if
the Proposed Business Combination had been completed as of the relevant balance sheet
dates, in this Circular, for the reasons set out below:
The Company was incorporated on 21 July 2021, listed on the SGX-ST on 20 January 2022
and has a financial year end of 31 December. As a SPAC that was incorporated for the
purpose of effecting an initial business combination, the Company does not currently have
any revenue-generating business or operations prior to Completion. Given the Company’s
nature as a SPAC and its short period of existence, the Company is of the view that it would
not be meaningful or helpful to investors for the proforma statement of comprehensive
income for the latest three financial years (i.e. FY2020, FY2021 and FY2022) to bepresented in the Circular. In particular, the Company would not have any financial
statements for FY2020 as it was only incorporated in 2021, and the Company was primarily
dormant for FY2021 given that the Company’s initial public offering was only completed in
January 2022.
Pursuant to a letter dated 8 November 2023 (the “SGX Letter”), the SGX-ST granted awaiver of Rule 609(b) of the Mainboard Rules, subject to adequate disclosures in the
Circular of the following:(a)the audited financial statements of the Target Group for FY2020, FY2021, FY2022 and1H FY2023;(b)

the pro forma income statements of comprehensive income for FY2022 and 1H
FY2023;52

LETTER TO SHAREHOLDERS(c)the pro forma statement of financial position as of the end of the FY2022 and 1H
FY2023;(d)the reason(s) for seeking the waiver of Rule 609(b) of the Mainboard Rules; and(e)a written confirmation from the Resulting Issuer that the waiver of Rule 609(b) of the
Mainboard Rules does not contravene any laws and regulations governing theResulting Issuer and its constituent documents.

Waiver from Compliance with Rule 210(11)(h)(iii) of the Mainboard Rules
Pursuant to Rule 210(11)(h)(iii) of the Mainboard Rules, following the Completion of the
Proposed Business Combination, all equity securities of (a) the founding shareholders andthe Management Team and their Associates; and (b) the Controlling Shareholders of theResulting Issuer and their Associates, and executive directors of the Resulting Issuer withan interest in 5% or more of the issued share capital of the Resulting Issuer, will be subject
to the moratorium requirements in Rules 227, 228, and 229 of the Mainboard Rules (inaccordance with the Resulting Issuer’s compliance with Rules 210(2)(a), (b) or (c) of the
Mainboard Rules, or Rule 210(8) of the Mainboard Rules, or Rule 210(9) of the Mainboard
Rules) from the Completion Date.
The Company applied to the SGX-ST for a waiver from the requirement under
Rule 210(11)(h)(iii) of the Mainboard Rules in respect of Fullerton, Tembusu and Temasek
for the following reasons:(a)in respect of Fullerton, the Company is of the view that a moratorium in respect ofFullerton’s indirect shareholding in the Sponsor is not required as the Sponsor is anindependently-managed Temasek portfolio company. Temasek is not involved in thebusiness or operational decisions of the Sponsor, including its decisions in relation to
the Target Group and the Company. Accordingly, given the definition of “associates” inrespect of Temasek as set out in the section titled “Definitions” of this Circular, theSponsor will not be deemed to be an “associate” of Temasek. Further, Fullerton will nothave any direct interest in any Shares in the Resulting Issuer. Fullerton’s interest in the
Shares of the Resulting Issuer arises only indirectly through the Sponsor, which in turnwholly owns Vertex Master Fund I Pte. Ltd., which in turn wholly owns Vertex SPV. In
addition, the Sponsor has agreed to provide a moratorium in respect of its effective
interest in the Shares of the Resulting Issuer which Vertex SPV will hold following
Completion, as well as a moratorium in respect of the Sponsor’s interest in Vertex
SPV. Accordingly, the Company is of the view that the moratoriums provided by theSponsor and Vertex SPV are sufficient for the purpose of complying with Listing Rule210(11)(h)(iii);(b)in respect of Tembusu, the Company is of the view that Tembusu should not be
required to provide a moratorium in respect of Innoven’s and FFMC’s respective directinterests in the Resulting Issuer, as such interests are only held through its indirect
shareholdings in Seviora Holdings Pte. Ltd. Each of Seviora Holdings Pte. Ltd.,
Innoven and FFMC is an independently managed Temasek portfolio company andTemasek is not involved in the business or operational decisions of these entities,
including their decisions in relation to the Target Group and the Company. Given thedefinition of “associates” in respect of Temasek as set out in the section titled“Definitions”, Seviora Holdings Pte. Ltd., and consequently, Innoven and FFMC, will
not be deemed to be “associates” of Temasek. Accordingly, the Company is of the view
53

LETTER TO SHAREHOLDERS
that Tembusu should not be required to provide a moratorium in respect of its indirectinterest in the Resulting Issuer, where such indirect interest arises from the aggregateof the direct interests of Innoven and FFMC in the Resulting Issuer.
(c)in respect of Temasek, the Company is of the view that Temasek should not be
required to provide a moratorium in respect of its effective interests in the Resulting
Issuer. Temasek is a global investment company headquartered in Singapore.
Temasek owns and manages a net portfolio value of S$382 billion as at 31 March
2023. Companies in Temasek’s portfolio are guided and managed by their respective
boards and managements, including FFMC, Seviora, Vertex SPV, the Vertex Funds,
the Sponsor, Innoven and Pavilion. Temasek is not involved in the business oroperational decisions of these entities, including their decisions in relation to theTarget Group and the Company. This is in line with Temasek’s overall governancepolicy with respect to its portfolio companies to promote sound corporate governanceby supporting high calibre, experienced and diverse boards to complement
management leadership, and leveraging its wide network of contacts to suggest
qualified individuals for consideration by the respective boards.

Pursuant to the SGX Letter, the SGX-ST granted a waiver of Rule 210(11)(h)(iii) of the
Mainboard Rules in respect of:(a)Fullerton in relation to its effective shareholding interests in the Resulting Issuer held
through the Sponsor, subject to adequate disclosures in the Circular of the reason(s)for seeking the waiver and a written confirmation from the Resulting Issuer that thewaiver does not contravene any laws and regulations governing the Resulting Issuer
and its constituent documents;(b)

Tembusu in relation to its effective shareholding interests in the Resulting Issuer held
through Innoven and FFMC, subject to adequate disclosures in the Circular of:(i)the reason(s) for seeking the waiver;(ii)

the reason(s) why FFMC and Innoven would not be considered to be “associates”
of Temasek;(iii) a written confirmation from the Resulting Issuer that the waiver ofRule 210(11)(h)(iii) of the Mainboard Rules in respect of Tembusu’s effective
interests in the Resulting Issuer held through Innoven and FFMC does notcontravene any laws and regulations governing the Resulting Issuer and its
constituent documents; and(c)Temasek in relation to its effective shareholding interests in the Resulting Issuer,
subject to adequate disclosures in the Circular on the reason(s) for seeking the waiverand a written confirmation from the Resulting Issuer that the waiver does notcontravene any laws and regulations governing the Resulting Issuer and its
constituent documents.

54

LETTER TO SHAREHOLDERS
3.

SUMMARY OF THE PROPOSED TRANSACTIONS

3.1

Proposed Business Combination(a)

The Proposed Business Combination
Pursuant to the SPA, the Company will acquire the entire issued and paid-up sharecapital of the Target Company of up to S$922.9 million (equivalent to approximately
US$680.6 million), to be satisfied by:(i)the allotment and issuance of the Consideration Shares at the Issue Price to the
Vendor (or if the Vendor so nominates, to the Vendor Shareholders) on
Completion, amounting to S$800.8 million (equivalent to approximately
US$590.6 million); and(ii)

subject to the satisfaction of the Financial Targets for Earnout, the allotment andissuance of the Earnout Shares at the Issue Price to the Earnout Shareholders
on the Earnout Vesting Date, amounting to S$122.0 million (equivalent toapproximately US$90.0 million).

Please refer to Section 5 titled “Proposed Business Combination” of this Circular for
further details.
Accordingly, a change of control will arise immediately upon Completion. Please refer
to Section 23.5 titled “Enlarged Group Corporate and Shareholding Structure– Changes in Shareholding Structure” of this Circular for further details.
(b)

Relative Figures under Rule 1006 of the Mainboard Rules
Pursuant to Rule 1015 of the Mainboard Rules, Shareholders’ approval, amongst
others, must be obtained for a “very substantial acquisition” or “reverse takeover” asdefined in Chapter 10 of the Mainboard Rules. Rule 1006 of the Mainboard Rules sets
out the computations for relative figures, and where any of the relative figures is 100%or more, or if the transaction is one which will result in the change in control of a listedcompany, such a transaction is a “very substantial acquisition” or “reverse takeover”.
The relative figures for the Proposed Business Combination using the bases ofcomparison set out in Rule 1006 of the Mainboard Rules are as follows:
Rules

Bases

Relative Figures

Rule 1006(a)Net asset value of the assets to bedisposed of, compared with theCompany’s net asset value

Not applicable(1)Rule 1006(b)Net profits attributable to the Target
Company, compared with the Company’s
net profits(3,976%)(2)55

LETTER TO SHAREHOLDERS
Rules

Bases

Relative Figures

Rule 1006(c)Aggregate value of the Purchase
Consideration given for the Proposed
Business Combination, compared with
the Company’s market capitalisation
based on the total number of issued
shares excluding Treasury Shares467%(3)Rule 1006(d)Number of equity securities issued by theCompany as Purchase Consideration for
the Proposed Business Combination,compared with the number of equity
securities of the Company in issue444%(4)Rule 1006(e)Aggregate volume or amount of proved
and probable reserves to be disposed of,compared with the aggregate of theCompany’s
provedandprobable
reserves

Not applicable(5)Notes:(1) Rule 1006(a) of the Mainboard Rules is not applicable to an acquisition of assets.
(2) Computed based on the Target Company’s net loss before tax for 1H FY2023 of approximately
US$115.3 million and the Company’s unaudited net profit before tax for 1H FY2023 of approximately
S$4.0 million (equivalent to approximately US$2.9 million).
(3) Computed based on (i) the Purchase Consideration of approximately S$922.9 million (equivalent toapproximately US$680.6 million), and (ii) the Company’s market capitalisation of approximately
S$197.7 million (computed based on the Company’s issued ordinary share capital of 41,606,000
Shares and the volume weighted average price of the Shares of S$4.7517 on 29 September 2023,
being the last full market day on which the Company’s Shares were traded prior to the date of the SPA).
The Company does not have any Treasury Shares. For the avoidance of doubt, the Company’s issued
ordinary share capital of 41,606,000 Shares does not include the Promote Shares to be allotted andissued to Vertex SPV as such Promote Shares will only be allotted and issued to Vertex SPV after
Completion in accordance with the vesting schedule set out in Section 29.2 titled “Material Contracts– The Company – Promote Shares Deed of Undertaking” of this Circular.
(4) Based on 160,162,651 Consideration Shares and up to 24,408,000 Earnout Shares and the Company’s
issued ordinary share capital of 41,606,000 Shares. For the avoidance of doubt, the Company’s issued
ordinary share capital of 41,606,000 Shares does not include the Promote Shares to be allotted andissued to Vertex SPV as such Promote Shares will only be allotted and issued to Vertex SPV after
Completion in accordance with the vesting schedule set out in Section 29.2 titled “Material Contracts– The Company – Promote Shares Deed of Undertaking” of this Circular.
(5) Rule 1006(e) of the Mainboard Rules is not applicable as the Company is not a mineral, oil and gas
company.

Notwithstanding the negative relative figure computed under Rule 1006(b) of the
Mainboard Rules, the relative figures computed under Rules 1006(c) and 1006(d) of
the Mainboard Rules exceed 100%. Accordingly, the Proposed Business Combination
constitutes a “very substantial acquisition” or “reverse takeover” pursuant toChapter 10 of the Mainboard Rules. In addition, as the Vendor and/or the Vendor
Shareholders (if so nominated by the Vendor) will hold approximately 77.2% of theEnlarged Share Capital of the Company upon Completion (assuming that there is No
Redemption and that the total proceeds raised from the PIPE Financing is S$10.0
million) and approximately 91.5% of the Enlarged Share Capital of the Company uponCompletion (assuming that there is Maximum Redemption and that the total proceeds
raised from the PIPE Financing is S$10.0 million), a change in control of the Company
56

LETTER TO SHAREHOLDERS
will arise immediately upon Completion. Accordingly, the Proposed Business
Combination is subject to, inter alia, the approval of the Shareholders at the EGM andthe approval of the SGX-ST pursuant to Rule 1015 of the Mainboard Rules.
3.2

Proposed Allotment and Issuance of the Consideration Shares
In partial satisfaction of the Purchase Consideration for the Proposed Business
Combination, and pursuant to the SPA, the Company shall allot and issue 160,162,651
Consideration Shares at the Issue Price to the Vendor (or if the Vendor so nominates, to the
Vendor Shareholders) on Completion.
Assuming that there is No Redemption and that the total proceeds raised from the PIPE
Financing is S$10.0 million, on Completion, the Vendor and/or the Vendor Shareholders
shall collectively hold 160,162,651 Shares, representing approximately 77.2% of theEnlarged Share Capital.
Assuming that there is Maximum Redemption and that the total proceeds raised from the
PIPE Financing is S$10.0 million, on Completion, the Vendor and/or the Vendor
Shareholders shall collectively hold 160,162,651 Shares, representing approximately
91.5% of the Enlarged Share Capital.
Please refer to Section 5.1 titled “Proposed Business Combination – Purchase
Consideration” and Section 6 titled “Proposed Allotment and Issuance of the Consideration
Shares” of this Circular for further details.

3.3

Proposed Allotment and Issuance of the Earnout Shares
In partial satisfaction of the Purchase Consideration for the Proposed Business
Combination, and pursuant to the SPA, the Company shall allot and issue up to 24,408,000
Earnout Shares at the Issue Price to the Earnout Shareholders in two tranches on the
Earnout Vesting Dates (starting in 30 April 2024), subject to the Financial Targets for
Earnout achieved by the Target Group.
Assuming that there is No Redemption and that the total proceeds raised from the PIPE
Financing is S$10.0 million, on the last Earnout Vesting Date, the Earnout Shareholders
shall collectively hold up to 184,570,651 Shares, representing approximately 72.7% of the
Fully Enlarged Share Capital.
Assuming that there is Maximum Redemption and that the total proceeds raised from the
PIPE Financing is S$10.0 million, on the last Earnout Vesting Date, the Earnout
Shareholders shall collectively hold up to 184,570,651 Shares, representing approximately
83.1% of the Fully Enlarged Share Capital.
Please refer to Section 5.1 titled “Proposed Business Combination – Purchase
Consideration” and Section 5.2 titled “Proposed Business Combination – The Earnout
Framework” of this Circular for further details.

3.4

Proposed Allotment and Issuance of the Base PIPE Shares
In connection with the Proposed Business Combination, the Company shall allot and issue
up to 2,000,000 Base PIPE Shares at the Issue Price to the PIPE Investors on Completion

57

LETTER TO SHAREHOLDERS
by way of a private placement in accordance with Section 272B, Section 274 andSection 275 of the SFA pursuant to the terms of the PIPE Subscription Agreements.
Assuming that there is No Redemption and that the total proceeds raised from the PIPE
Financing is S$10.0 million, on Completion, the PIPE Investors shall collectively hold up to
2,200,000 Shares (comprising the Base PIPE Shares and the Special Bonus PIPE Shares),representing approximately 1.1% of the Enlarged Share Capital.
Assuming that there is Maximum Redemption and that the total proceeds raised from the
PIPE Financing is S$10.0 million, on Completion, the PIPE Investors shall collectively holdup to 2,200,000 Shares (comprising the Base PIPE Shares and the Special Bonus PIPE
Shares), representing approximately 1.3% of the Enlarged Share Capital.
Please refer to Section 5.4 titled “Proposed Business Combination – PIPE Financing” of thisCircular for further details.
3.5

Proposed Allotment and Issuance of the Special Bonus Shares
Assuming that there is No Redemption and that the total proceeds raised from the PIPE
Financing is S$10.0 million, in connection with the Proposed Business Combination, theCompany shall allot and issue up to 3,760,600 Special Bonus Shares at the Issue Price on
Completion, comprising (a) up to 3,560,600 Special Bonus Shares to be allotted and issued
to the Non-Redeeming Shareholders, and (b) up to 200,000 Special Bonus PIPE Shares tobe allotted and issued to the PIPE Investors. On Completion, the Non-Redeeming
Shareholders as well as Vertex SPV (being a Shareholder who is not entitled to exercise theRedemption Right) shall collectively hold up to 45,166,600 Shares, representing
approximately 21.8% of the Enlarged Share Capital, and the PIPE Investors shallcollectively hold up to 2,200,000 Shares, representing approximately 1.1% of the Enlarged
Share Capital.
Assuming that there is Maximum Redemption, and that the total proceeds raised from the
PIPE Financing is S$10.0 million, in connection with the Proposed Business Combination,
the Company shall allot and issue up to 800,000 Special Bonus Shares at the Issue Priceon Completion, comprising (a) up to 600,000 Special Bonus Shares to be allotted andissued to Venezio (being a Shareholder who is not entitled to exercise the Redemption
Right), and (b) up to 200,000 Special Bonus PIPE Shares to be allotted and issued to the
PIPE Investors. On Completion, Vertex SPV and Venezio (being Shareholders who are notentitled to exercise the Redemption Right) shall collectively hold up to 12,600,000 Shares,
representing approximately 7.2% of the Enlarged Share Capital, and the PIPE Investors
shall collectively hold up to 2,200,000 Shares, representing approximately 1.3% of theEnlarged Share Capital.
Please refer to Section 5.3 titled “Proposed Business Combination – Special Bonus
Scheme” of this Circular for further details.

3.6

Proposed Adoption of the Executive Incentive Scheme
The Company proposes to seek Shareholders’ approval to adopt the EIS in connection with
the Proposed Business Combination, pursuant to which the Company shall allot and issue
up to 2,550,000 EIS Shares at the Issue Price to the Key Executives on the EIS Vesting
Dates subject to and based on the Financial Targets for EIS achieved.

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LETTER TO SHAREHOLDERS
Please refer to Section 10 titled “Proposed Adoption of the Executive Incentive Scheme”
and Section 11 titled “Proposed Allotment and Issuance of the EIS Shares” of this Circularfor further details.
3.7

Proposed Allotment and Issuance of the EIS Shares
In connection with the Proposed Business Combination, and pursuant to the SPA, theCompany shall allot and issue up to 2,550,000 EIS Shares at the Issue Price to the Key
Executives on the EIS Vesting Dates (starting in 30 April 2024) subject to and based on the
Financial Targets for EIS achieved.
Assuming that there is No Redemption and that the total proceeds raised from the PIPE
Financing is S$10.0 million, on the last EIS Vesting Date, the Key Executives shallcollectively hold up to 2,550,000 Shares, representing approximately 1.0% of the Fully
Enlarged Share Capital.
Assuming that there is Maximum Redemption and that the total proceeds raised from the
PIPE Financing is S$10.0 million, on the last EIS Vesting Date, the Key Executives shallcollectively hold up to 2,550,000 Shares, representing approximately 1.1% of the Fully
Enlarged Share Capital.
Please refer to Section 10 titled “Proposed Adoption of the Executive Incentive Scheme” ofthis Circular for further details.

3.8

Proposed Adoption of the Company Employee Share Option Plan
The Company proposes to seek Shareholders’ approval to adopt the Company ESOP inconnection with the Proposed Business Combination, pursuant to which the Company shallallot and issue the ESOP Shares.
Please refer to Section 12 titled “Proposed Adoption of the Company Employee Share
Option Plan” and Section 13 titled “Proposed Allotment and Issuance of the ESOP Shares”
of this Circular for further details.

3.9

Proposed Allotment and Issuance of the ESOP Shares
In connection with the Proposed Business Combination, the Company shall allot and issue
up to 2,114,891 ESOP Shares in accordance with the Company ESOP.
Please refer to Section 12 titled “Proposed Adoption of the Company Employee Share
Option Plan” of this Circular for further details.

3.10 Proposed Change of the Company’s Name
Pursuant to the SPA and subject to the passing of the special resolution at the EGM, theCompany’s name shall, conditional upon and concurrent with Completion, be changed from
“Vertex Technology Acquisition Corporation Ltd” to “17LIVE Group Limited”. The proposedname change is to reflect the change of the business activities of the Enlarged Group to thatof the Target Company’s Business following Completion.
Please refer to Section 32 titled “Proposed Change of the Company’s Name” of this Circularfor further details.
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LETTER TO SHAREHOLDERS
3.11

Proposed Adoption of the New Memorandum and Articles of Association
Subject to the passing of the special resolution at the EGM, the Company proposes to adopt
the New Memorandum and Articles of Association with effect from Completion for
consistency with the prevailing provisions of the Mainboard Rules and to remove obsolete
SPAC provisions that would no longer apply following Completion.
Please refer to Section 33 titled “Proposed Adoption of the New Memorandum and Articles
of Association” of this Circular for further details.

3.12 Proposed Appointment of the Proposed Directors
Upon Completion, the Company proposes to appoint the Proposed Directors who are as
follows:(a)Mr. Phua Jiexian Joseph (Non-Executive Director and Chairman);(b)

Mr. Lien Chien-Lin (Executive Director and CEO);(c)

Mr. Akio Tanaka (Non-Executive Director);(d)Mr. Hideto Mizuno (Independent Non-Executive Director); and(e)

Ms. Chen Xiuling (Independent Non-Executive Director)

Please refer to Section 24 titled “Proposed Directors and Executive Officers of the Enlarged
Group” of this Circular for details on the working experience and qualifications of the
Proposed Directors.
3.13 Inter-conditionality of Resolutions
Shareholders should note that:(a)Ordinary Resolutions 1 to 9 as well as Special Resolutions 1 and 2 (“KeyResolutions”) are inter-conditional. This means that if any of the Key
Resolutions is not passed, the other Key Resolutions would not be passed; and(b)

Ordinary Resolutions 10, 11, 12, 13, 14 and 15 are conditional upon the passingof the Key Resolutions (“Conditional Resolutions”).

In particular, Shareholders should note that:(a)

The following resolutions (collectively, the “Key Resolutions”) are inter-conditional as
the subject matter of the Key Resolutions will facilitate the conduct of business of theEnlarged Group upon Completion:•

Ordinary Resolution 1: Proposed Business Combination between the Company
and 17LIVE Inc. by way of an acquisition by the Company of the entire issued andpaid-up share capital of 17LIVE Inc. from the Vendor for the Purchase
Consideration;

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LETTER TO SHAREHOLDERS•

Ordinary Resolution 2: Proposed allotment and issuance of 160,162,651
Consideration Shares at the Issue Price of S$5.00 in partial satisfaction of thePurchase Consideration for the Proposed Business Combination;•

Ordinary Resolution 3: Proposed allotment and issuance of up to 24,408,000
Earnout Shares at the Issue Price of S$5.00 to the Earnout Shareholders inpartial satisfaction of the Purchase Consideration for the Proposed Business
Combination, subject to the satisfaction of the Financial Targets for Earnout;•

Ordinary Resolution 4: Proposed allotment and issuance of up to 2,000,000 BasePIPE Shares at the Issue Price of S$5.00 to the PIPE Investors;•

Ordinary Resolution 5: Proposed allotment and issuance of up to 3,760,600
Special Bonus Shares at the Issue Price of S$5.00 to the Non-Redeeming
Shareholders and the PIPE Investors;•

Ordinary Resolution 6: Proposed adoption of the Executive Incentive Scheme;•

Ordinary Resolution 7: Proposed allotment and issuance of up to 2,550,000 EIS
Shares at the Issue Price of S$5.00 to the Key Executives, subject to thesatisfaction of the Financial Targets for EIS;•

Ordinary Resolution 8: Proposed adoption of the Company Employee Share
Option Plan;•

Ordinary Resolution 9: Proposed allotment and issuance of up to 2,114,891
ESOP Shares pursuant to the Company Employee Share Option Plan;•

Special Resolution 1: Proposed Change of the Company’s Name to “17LIVE
Group Limited”; and•Special Resolution 2: Proposed Adoption of the New Memorandum and Articles
of Association.

This means that if any one of these Key Resolutions is not passed, the other Key
Resolutions would not be passed.
(b)Each of the remaining resolutions is conditional upon the passing of the Key
Resolutions (“Conditional Resolutions”):•

Ordinary Resolution 10: Proposed Change of the Company’s Independent
Auditor•Ordinary Resolution 11: Proposed appointment of Mr. Phua Jiexian Joseph as a
new Director upon Completion;•

Ordinary Resolution 12: Proposed appointment of Mr. Lien Chien-Lin as a new
Director upon Completion;•

Ordinary Resolution 13: Proposed appointment of Mr. Akio Tanaka as a new
Director upon Completion;

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LETTER TO SHAREHOLDERS•

Ordinary Resolution 14: Proposed appointment of Mr. Hideto Mizuno as a new
Director upon Completion; and•Ordinary Resolution 15: Proposed appointment of Ms. Chen Xiuling as a new
Director upon Completion.

This means that if any of the Key Resolutions is not passed, the Conditional
Resolutions would not be passed. If any of the Key Resolutions is not passed, theProposed Business Combination will not complete and KPMG LLP will continue to be
the Independent Auditor of the Company.
4.

RATIONALE FOR THE PROPOSED BUSINESS COMBINATION

4.1

Requirement for the Completion of an Initial Business Combination
The Company is a special purpose acquisition company incorporated for the purpose ofeffecting an initial business combination. Pursuant to Rule 210(11)(m)(i) of the Mainboard
Rules, the Company is required to complete an initial business combination within
24 months from the Listing Date (the “BC Deadline”). Where the Company has entered intoa legally binding agreement for an initial business combination before the end of the
24-months period, the Company will have up to not more than 12 months from the BC
Deadline to complete the initial business combination, subject to an overall maximum
timeframe of 36 months from the date of the Listing, provided that: (a) such an extension
is permitted by and in accordance with the Company’s Memorandum and Articles of
Association and all laws and regulations in respect of the Cayman Islands applicable to theCompany; (b) SGX-ST is notified of such an extension in a timely manner; (c) the extension
is announced via SGXNET by the Company in a timely manner; and (d) in theannouncement referred to in (c), the Company confirms that: (i) there is no material adversechange to the Company’s financial position since the date of the Prospectus; (ii) the
extension is permitted by and in accordance with all laws and regulations in respect of the
Cayman Islands applicable to the Company; and (iii) the Company will provide quarterly
updates to investors on the Company’s progress in meeting the key milestones incompleting the initial business combination via SGXNET.
The initial business or asset acquired pursuant to the initial business combination musthave a fair market value of at least 80.0% of the amount in the Escrow Account at the timeof entry into the binding agreement for the initial business combination transaction,
excluding any amount held in the Escrow Account representing deferred underwriting
commissions and any taxes payable on the income earned on the escrowed funds. Where
the Company intends to consummate multiple concurrent acquisitions or mergers as part ofthe initial business combination, there must be at least one initial acquisition which satisfies
the requirement of having a fair market value constituting at least 80.0% of the amount heldin the Escrow Account at the time of entry into the binding agreements for the initialbusiness combination transactions, and such concurrent transactions must be in separate
resolutions and conditional upon the initial acquisition and completed simultaneously on oraround the same day within the permitted time frame.

4.2

The Company’s Acquisition Mandate
The Company had stated in the Prospectus that its goal is to identify and collaborate witha technology company that has the potential to improve people’s lives by transforming
businesses, markets and economies. The Company seeks to work with its target company
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LETTER TO SHAREHOLDERS
to expand into new markets, recruit top-tier management talent, access global capital
markets, and execute a business plan to help the Company grow by targeting best-in-classdisruptive and transformational technologies, focusing the Company’s search on
high-growth targets having a proven business model that can be scaled regionallyand globally, and generating value beyond capital by acquiring a target company
that is well-placed to benefit from having access to the Sponsor’s global network ofindustry-leading companies and investor ecosystem.
Consistent with the Company’s business strategy, the Company had stated in the
Prospectus that it intends to acquire one or more businesses that may, among others,
display the following characteristics:(a)Technology-driven Businesses. The Company will seek businesses with
next-generation disruptive technologies, in particular, companies with a coretechnological focus with highly-differentiated products in its market and is ready totake its business to the next stage of its life cycle. In identifying potential businesscombination targets, the Company intends to focus on six investment themes that will
be at the forefront of technology transformation, and in which the Sponsor’s
ecosystem has deep domain expertise: (i) cyber security and enterprise solutions;(ii) artificial intelligence; (iii) consumer internet and technologies; (iv) financial
technologies; (v) autonomous driving and new-energy vehicles; and (vi) biomedical
technologies and digital healthcare. The Company believes that the Company has theadvantage of the Sponsor’s and the Management Team’s understanding of thetechnology market and proven investment track record in technology-driven
businesses. The Company also believes that these types of businesses present
stronger growth trajectories than traditional businesses. As such, the Company
intends to focus on businesses with a core technological focus that is disruptive andtransformational.

(b)

Fast-growing Scalable Businesses. The Company will look for scalable acquisition
targets that have strong growth potential underpinned by multiple growth drivers andsteady revenue streams. As the Sponsor is an experienced venture capital investor,
the Company believes such businesses will synergise well with the Management
Team’s expertise, and will provide the Company with avenues to add value to suchbusinesses success by tapping on the Company’s proprietary Vertex ecosystem. The
Company also intends to leverage on the Sponsor’s expertise and specialisation inscaling businesses in order to help propel them into their next stage of growth. In
addition, the Vertex ecosystem includes the Vertex Network Funds, the Vertex Captive
Funds, and the network of industry partners established by the Sponsor in Asia as wellas in other parts of the world. The Sponsor intends to continue to support the target
company by tapping into this ecosystem, for new business development opportunities,
greater talent sourcing network and global investor network expansion.

(c)Businesses at an Inflection Point. The Company intends to identify potential targets
that are at an inflection point of their growth journey. These could be businesses thatare revenue generating with a proven product, service or business model, but possibly
in need of additional growth capital, management experience or global partnerships
for further growth. The Company intends to leverage on the global capabilities ofVertex ecosystem to help the target company realise its growth potential.

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LETTER TO SHAREHOLDERS(d)Strong Management Teams. The Company seeks companies with established,innovative and tenacious management teams with intentions to drive growth whilebuilding a sustainable and resilient business. The Company intends to support the
management teams to execute their vision, leveraging on the Company’s experienceof nurturing investee companies.

(e)

Cross-border Potential with Market Leadership. The Company intends to leverageon the Sponsor’s global network and deep local knowledge to scale the target
company’s operations across borders and develop anchor customers in new regions
and expand its portfolio rapidly in order to maintain or achieve market leadership.

(f)

Appropriate Valuation. The Company intends to leverage on the Sponsor’s strong
experience in venture capital investing to adopt a disciplined and valuation-centric
approach to selecting an acquisition target. The Company will only invest in targets
that it believes are attractively priced relative to its peers which would provide upside
potential and benefit from public market access. In assessing the valuation of aprospective target in determining their suitability for the Company’s initial businesscombination, the Management Team, with the support of the Sponsor, will access
Vertex’s global pool of portfolio companies and their market intelligence to have better
assessment of the valuation metrics and trends in different industries and geographies
to allow the Company to benchmark a prospective target’s valuation against similar
players globally.

The criteria set forth are not intended to be exhaustive. Any evaluation relating to the meritsof a particular initial business combination may be based, to the extent relevant, on thesegeneral guidelines as well as on other considerations, factors and criteria that theManagement Team may deem relevant.
For as long as the Company remains on the Official List of the SGX-ST Mainboard, any
proposed change of acquisition mandate for the initial business combination must be
approved by special resolution by a majority of at least 75.0% of the votes cast by
Shareholders at a general meeting to be convened.
4.3

The Company’s Assessment of the Target GroupIn sourcing for potential business combination targets, the Company has the advantage ofbeing able to closely track the progress of investee companies within the Vertex Network
Funds which are potential business combination targets. As a limited partner, Vertex has
the benefit of receiving proprietary insights on a regular basis on the performance, growthand market outlook of the investee companies within the Vertex Network Funds, with directaccess to the management teams of these companies. In identifying and evaluating theTarget Company as an acquisition target for the initial business combination, theManagement Team, with the support of the Sponsor, leveraged their access to Vertex’s
global pool of portfolio companies (in particular, in countries where companies of a similar
nature to the Target Company operate, such as companies that the Vertex Funds had
invested in) and their market intelligence to gain better assessment of the valuation metrics
and trends in different industries and geographies, which allowed the Company tobenchmark the Target Company’s valuation against similar players globally.

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LETTER TO SHAREHOLDERSThe Company had assessed the suitability of the Target Group against the criteria set out
in the Prospectus and had ultimately selected the Target Company as an acquisition target
for the initial business combination in accordance with the Company’s acquisition mandate.
In particular, the Company had considered the following:(a)the Target Group operates a technology-driven business in the consumer internet andtechnologies industry, which is one of the industries in which the Sponsor and theManagement Team has deep expertise and a proven track record. The Sponsor andthe Management Team’s expertise and track record are attributable to the Sponsor’s
previous investment (through the Vertex Network Funds) in consumer technology
companies which in turn provided the Management Team with opportunities to acquire
operational experience in managing consumer technology companies;(b)

the Target Group operates a scalable business (i.e. the Liver live streaming business)with strong growth potential as evidenced by its multiple growth drivers (namely,
V-Liver live streaming, live commerce and in-app games, in addition to the core Liverlive streaming business);(c)the Target Group operates businesses at an inflection point, such as the V-Liver live
streaming business. Please refer to Section 14.3 titled “Information on the Target
Company – Business Overview – The Target Group’s Business Lines – V-Liver” of thisCircular for further details;(d)the Target Company is led by a strong management team with professional expertisein various areas such as consumer technology and product development, cross-borderbusiness operations, finance and corporate management. Please refer to Section 24.2
titled “Proposed Directors and Executive Officers – Experience of the Proposed
Directors” and Section 24.5 titled “Proposed Directors and Executive Officers– Experience of the Proposed Executive Officers” of this Circular for further details;
and

(e)

the Target Group presents cross-border potential with market leadership. While theTarget Group currently operates mainly in Japan and Taiwan, its platforms areavailable to live streamers and users from the U.S., Hong Kong, Singapore and other
Southeast Asian countries. Although the Target Group’s operating revenues fromthese markets are currently not significant, the Target Group expects them to become
future growth drivers, and there is potential for the Target Group’s operations to bescaled up and expanded across these regions, given that the Target Group’s coreexpertise and knowledge can be readily exported into countries where similar content
and services (for example, V-Liver content) are already being consumed.

Please refer to Section 14.16 titled “Information on the Target Company – Competitive
Strengths” of this Circular as well as the section titled “Proposed Business – Business
Strategies and Future Plans – Sourcing of Potential Business Combination Targets” of theProspectus for further details.
Accordingly, subject to Shareholders’ approval, the Company intends to complete the
Proposed Business Combination with the Target Company before the BC Deadline,
i.e. 20 January 2024.

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LETTER TO SHAREHOLDERS
5.

PROPOSED BUSINESS COMBINATION

5.1

Purchase Consideration
The Purchase Consideration for the Proposed Business Combination shall be satisfied by
a combination of the following:(a)the allotment and issuance of 160,162,651 Consideration Shares in the aggregate at
the Issue Price, comprising:(i)in respect of the Basic Sale Shares, 148,918,937 Consideration Shares to be
allotted and issued to the Vendor (or if the Vendor so nominates, to the Vendor
Shareholders) on the Completion Date;(ii)

in respect of the 17LIVE Vested RSUs, 10,909,111 Consideration Shares to be
allotted and issued to the 17LIVE Vested RSU Holders on the Completion Date;and(iii) in respect of the 17LIVE Warrants, 334,603 Consideration Shares to be allotted
and issued to the 17LIVE Warrant Holders on the Completion Date; and(b)subject to the satisfaction of the Financial Targets for Earnout by the Target Group, theallotment and issuance of the Earnout Shares at the Issue Price by the Company to
the Vendor (or, if the Vendor so nominates, to the relevant Vendor Shareholder) on
each applicable Earnout Vesting Date.

For the avoidance of doubt, the Company will not receive any proceeds from the allotment
and issuance of the Consideration Shares and the Earnout Shares.
The Purchase Consideration was arrived at after arms’ length negotiations between the
Company and the Vendor, and on a willing-buyer and willing-seller basis, taking into
consideration, the earnings and business prospects of the Target Company. Please refer to
Section 5.8 titled “Proposed Business Combination – Valuation of the Target Company” ofthis Circular for further details.
The Issue Price for each Consideration Share and Earnout Share represents a premium of
5.3% to the volume-weighted average price of S$4.75 per Share, based on trades done on
the Shares on the Mainboard on the full market day preceding the date of the SPA, being
29 September 2023.
5.2

Earnout Framework
In partial satisfaction of the Purchase Consideration for the Proposed Business
Combination, and pursuant to the SPA, the Company shall allot and issue the Earnout
Shares at the Issue Price to the Earnout Shareholders, in two tranches on the Earnout
Vesting Dates (i.e. 30 April 2024 and 30 August 2024), subject to the Financial Targets for
Earnout for the relevant Earnout Vesting Date achieved by the Target Group. The Financial
Targets for Earnout for each Earnout Vesting Date are set out in Appendix J to this Circular.
The Earnout Shares shall be allotted and issued to each Earnout Shareholder on a pro rata
basis by reference to the formula set out in Appendix J to this Circular. The Earnout
Shareholders are Vendor Shareholders who have been nominated by and at the discretion
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LETTER TO SHAREHOLDERSof the Vendor to receive the Earnout Shares and who remain as record holders of theConsideration Shares as at the applicable Earnout Record Date. If the Vendor nominates
all the Vendor Shareholders to receive the Earnout Shares, and all such Vendor
Shareholders remain as record holders of the Consideration Shares as at the applicable
Earnout Record Date, then the Earnout Shareholders will comprise all the Vendor
Shareholders.
Assuming that there is No Redemption and that the total proceeds raised from the PIPE
Financing is S$10.0 million, on the last Earnout Vesting Date, the Earnout Shareholders
shall collectively hold up to 184,570,651 Shares, representing approximately 72.7% of the
Fully Enlarged Share Capital.
Assuming that there is Maximum Redemption and that the total proceeds raised from the
PIPE Financing is S$10.0 million, on the last Earnout Vesting Date, the Earnout
Shareholders shall collectively hold up to 184,570,651 Shares, representing approximately
83.1% of the Fully Enlarged Share Capital.
Rationale for the Earnout Framework
The main objective of the Earnout Framework is to incentivise the Earnout Shareholders,being a group of Shareholders with a relatively substantial shareholding in the Enlarged
Group, to hold on to the Consideration Shares they received at Completion and not disposeof the same up to at least the Earnout Record Dates.
In addition, the Earnout Framework serves to achieve the following objectives:
First, the Earnout Framework serves to incentivise the Enlarged Group to work towards
achieving higher revenue targets in the near future and in particular reflects the importanceof the Target Group’s V-Liver business as the core driver of the Enlarged Group’s business,thereby driving business growth and enhancing shareholder value. Please refer to Section
14.3 titled “Information on the Target Company – Business Overview – V-Liver” of thisCircular for further details. To this end, the Company has prescribed certain targets for the
total V-Liver Operating Revenue that the Enlarged Group is required to achieve by therespective Earnout Vesting Dates in order for the Earnout Shares to vest (subject to theEnlarged Group achieving the pre-determined “Group Operating Revenue” figure for the
relevant period as a pre-condition).
Second, the adoption of the Earnout Framework serves to incentivise the Enlarged Groupto work towards sustainable profitability. By tying the allotment and issuance of the Earnout
Shares to the Group EBITDA achieved, the Company seeks to ensure that while theEnlarged Group pursues revenue growth through the various initiatives including theV-Liver business, it also maintains a strong focus on the bottom line, thereby balancing both
growth and profitability. Please refer to Section 18 titled “Management’s Discussion andAnalysis of Financial Position and Results of Operations of the Target Group” of thisCircular for further details.
Third, the Earnout Framework which provides for a portion of Earnout Shares to vest basedon the financial results of the Enlarged Group up to the six months ending 30 June 2024,
serves to align the long-term behaviour of the Proposed Management Team with theinterests of the Shareholders by deterring the use of short-term strategies that may
temporarily boost the Company’s performance at the expense of the Company’s long-term
growth and profitability.
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5.3

Special Bonus Scheme
In connection with the Proposed Business Combination, the Company will allot and issue(a) 0.1 new Shares (the “Special Bonus NRS Shares”) at the Issue Price, allotted as fully
paid up, to the Non-Redeeming Shareholders for every existing Share held by the
Non-Redeeming Shareholders as at the Redemption Record Date (rounded downwards tothe nearest integer), and (b) 0.1 new Shares (the “Special Bonus PIPE Shares”) at theIssue Price, allotted as fully paid up, to the PIPE Investors for every Base PIPE Sharesubscribed for by the PIPE Investors in connection with the Proposed Business
Combination pursuant to the terms and conditions of the PIPE Subscription Agreements(rounded downwards to the nearest integer) (the “Special Bonus Scheme”) (the Special
Bonus NRS Shares and the Special Bonus PIPE Shares collectively referred to as the“Special Bonus Shares”). The Special Bonus Shares will be allotted and issued atCompletion.
Assuming that there is No Redemption and that the total proceeds raised from the PIPE
Financing is S$10.0 million, in connection with the Proposed Business Combination, theCompany shall allot and issue up to 3,760,600 Special Bonus Shares at the Issue Price on
Completion, comprising (a) up to 3,560,600 Special Bonus Shares to be allotted and issued
to the Non-Redeeming Shareholders, and (b) up to 200,000 Special Bonus PIPE Shares tobe allotted and issued to the PIPE Investors. On Completion, the Non-Redeeming
Shareholders as well as Vertex SPV (being a Shareholder who is not entitled to exercise theRedemption Right) shall collectively hold up to 45,166,600 Shares, representing
approximately 21.8% of the Enlarged Share Capital, and the PIPE Investors shallcollectively hold up to 2,200,000 Shares, representing approximately 1.1% of the Enlarged
Share Capital.
Assuming that there is Maximum Redemption, and that the total proceeds raised from the
PIPE Financing is S$10.0 million, in connection with the Proposed Business Combination,
the Company shall allot and issue up to 800,000 Special Bonus Shares at the Issue Priceon Completion, comprising (a) up to 600,000 Special Bonus Shares to be allotted andissued to Venezio (being a Shareholder who is not entitled to exercise the Redemption
Right), and (b) up to 200,000 Special Bonus PIPE Shares to be allotted and issued to the
PIPE Investors. On Completion, Vertex SPV and Venezio (being Shareholders who are notentitled to exercise the Redemption Right) shall collectively hold up to 12,600,000 Shares,
representing approximately 7.2% of the Enlarged Share Capital, and the PIPE Investors
shall collectively hold up to 2,200,000 Shares, representing approximately 1.3% of theEnlarged Share Capital.
All Non-Redeeming Shareholders (including Venezio) who are not Non-Qualifying
Shareholders as at the Redemption Record Date will be eligible for Special Bonus NRS
Shares based on the Shares they hold at the Redemption Record Date.
Please refer to Section 42.2 titled “Important Notice to Shareholders and Actions to be
Taken – Redemption – Procedures for Non-Redeeming Shareholders” of this Circular for
further information on the procedures in respect of the entitlements of the Non-Redeeming
Shareholders.
Rationale for the Special Bonus Scheme
There are two objectives of the Special Bonus Scheme. First, it provides an incentive for the
existing Shareholders to remain as Shareholders and not opt to redeem their Shares at or
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LETTER TO SHAREHOLDERS
prior to the Redemption Record Date. Second, the Special Bonus Scheme also provides an
incentive for private investors to participate in the PIPE Financing.
5.4

PIPE Financing
The Company intends to carry out a placement exercise for the allotment and issuance ofup to 2,000,000 Base PIPE Shares at the Issue Price to the PIPE Investors on Completionby way of a private placement in accordance with Section 272B, Section 274 andSection 275 of the SFA pursuant to the terms of the PIPE Subscription Agreements. The
Company intends to raise up to approximately S$10.0 million from the PIPE Financing.
Assuming that there is No Redemption and that the total proceeds raised from the PIPE
Financing is S$10.0 million, on Completion, the PIPE Investors shall collectively hold up to
2,200,000 Shares (comprising the Base PIPE Shares and the Special Bonus PIPE Shares),representing approximately 1.1% of the Enlarged Share Capital.
Assuming that there is Maximum Redemption and that the total proceeds raised from the
PIPE Financing is S$10.0 million, on Completion, the PIPE Investors shall collectively holdup to 2,200,000 Shares (comprising the Base PIPE Shares and the Special Bonus PIPE
Shares), representing approximately 1.3% of the Enlarged Share Capital.
Based on the PIPE Subscription Agreements, the Base PIPE Shares will not be placed toany person who is a Director, a Proposed Director or a Substantial Shareholder of theTarget Company or the Enlarged Group (as the case may be), or any other person in the
categories set out in Rule 812(1) of the Mainboard Rules. Please refer to Section 23.5 titled“Enlarged Group Corporate and Shareholding Structure – Changes in Shareholding
Structure” of this Circular for shareholding effects of, among other things, the PIPE
Financing on the shareholding of the existing Shareholders.
The Company has appointed DBS and UBS as the placement agents for the PIPE
Financing. The final terms of the PIPE Financing (including the placement commission) are
set out in the Management and Placement Agreement.
Terms of the PIPE Financing
The Base PIPE Shares will be issued on Completion and upon their allotment and issuance,
be credited as fully paid-up and free from all encumbrances and will rank pari passu in all
respects with the existing issued Shares save for any rights, benefits, dividends andentitlements the record date of which is before Completion.
The PIPE Financing shall be subject to, inter alia, the following conditions being fulfilled:(a)the receipt of approvals from the SGX-ST approving, among others, the Listing, theProposed Business Combination and the PIPE Financing and all such approvals fromthe SGX-ST remaining in full force and effect on the Settlement Date, such approvals
not having been revoked or amended and, where such approvals are subject toconditions, to the extent that any conditions are required to be fulfilled on or before theSettlement Date, they are so fulfilled;(b)where necessary, the approval of the Shareholders for the allotment and issue of the
PIPE Shares to the PIPE Investors being obtained at the EGM;

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LETTER TO SHAREHOLDERS(c)

all consents and approvals (if any) required under any and all applicable laws for,among others, the Listing, the Proposed Business Combination and the PIPE
Financing and to give effect to the transactions contemplated under the PIPE
Subscription Agreement being obtained;(d)the respective representations, warranties and undertakings of the PIPE Investors in
the PIPE Subscription Agreement remaining true and accurate at all times until the
Settlement Date;(e)

as at the Settlement Date, the allotment and issue of the PIPE Shares, the obligationof the PIPE Investors to subscribe for the PIPE Shares and pay for the Base PIPE
Shares, and the carrying out of any transaction contemplated by, or the compliancewith the terms of the PIPE Subscription Agreements, not being prohibited by any law,rule, regulation, ordinance, order, judgment or decree of or undertaking to any court,
government body, statutory authority or regulatory, administrative or supervisory body(including without limitation, any relevant stock exchange or securities council),whether in Singapore or any other relevant jurisdiction;(f)the entry into the Management and Placement Agreement and the SPA by the parties
thereto; and(g)the Management and Placement Agreement and the SPA not having been terminatedpursuant to their respective terms on or prior to the Settlement Date, and all the
relevant conditions under the Management and Placement Agreement and the SPA
having been satisfied or waived in accordance with its terms.

Use of Proceeds from the PIPE Financing
The Enlarged Group expects to receive net proceeds of up to approximately S$10.0 million
from the issuance of the Base PIPE Shares.
Shareholders should note that the actual number of Base PIPE Shares to be issued will
depend on various factors such as market conditions, as well as potential PIPE Investors’interest in the Shares of the Company upon Completion, and there is no certainty or
assurance that the Company will be able to place out all or any of the Base PIPE Shares.
Please refer to Section 22.3 titled “Use of Proceeds – Use of Proceeds Raised from the
PIPE Financing and the Completion Remaining Escrow Amount” of this Circular for details
on the use of proceeds.
Information on the PIPE Investors
Prior to Completion, each of the PIPE Investors will enter into a PIPE Subscription
Agreement with the Company to subscribe for an aggregate of up to 2,000,000 Base PIPE
Shares at the Issue Price, conditional upon the Management and Placement Agreement
having been entered into and not having been terminated pursuant to its terms on or prior
to the Completion Date.
The Company will make an announcement on SGXNET by 21 November 2023 setting out
the actual amount of proceeds raised from the PIPE Financing and the actual number ofBase PIPE Shares allotted and issued to the PIPE Investors.

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5.5

Executive Incentive Scheme
In connection with the Proposed Business Combination, and pursuant to the SPA, theCompany shall allot and issue up to 2,550,000 EIS Shares at the Issue Price to the Key
Executives on the EIS Vesting Dates subject to and based on the Financial Targets for EIS
achieved for the relevant EIS Vesting Date.
Please refer to Section 5.1 titled “Proposed Business Combination – Purchase
Consideration” and Section 10 titled “Proposed Adoption of the Executive Incentive
Scheme” of this Circular for further details.

5.6

Company ESOPIn connection with the Proposed Business Combination, the Company shall allot and issue
up to 2,114,891 ESOP Shares in accordance with the Company ESOP.
Please refer to Section 3.9 titled “Summary of the Proposed Transactions – Proposed
Allotment and Issuance of the ESOP Shares” and Section 12 titled “Proposed Adoption of
the Company Employee Share Option Plan” of this Circular for further details.

5.7

Sponsor’s Waiver of Promote Shares
Pursuant to the Promote Shares Deed of Undertaking, the Sponsor is entitled to theallotment and issuance of up to 10,401,500 Promote Shares (“Original Maximum Promote
Shares”) in favour of Vertex SPV for a nominal consideration of S$25,000 following thecompletion of the Company’s initial business combination, such Promote Shares (a) to bevested over a certain period subject to certain terms and conditions as set out below, and(b) to constitute no less than 20.0% of the issued and paid-up share capital of the Company
on a fully diluted basis immediately following the Listing. The Promote Shares will vest, andbe allotted and issued in favour of Vertex SPV, based on the following schedule:(a)49.0% of the Promote Shares (rounded down to the nearest whole number) on thedate falling 12 months after the completion of the initial business combination(“Tranche 1 Promote Shares”);(b)

17.0% of the Promote Shares (rounded down to the nearest whole number) on thedate during the 10 calendar years following the date of completion of the initialbusiness combination upon the Return to Shareholders (as defined below) exceeding
20% (“Tranche 2 Promote Shares”);(c)

17.0% of the Promote Shares (rounded down to the nearest whole number) on thedate during the 10 calendar years following the date of completion of the initialbusiness combination upon the Return to Shareholders exceeding 40% (“Tranche 3
Promote Shares”); and(d)17.0% of the Promote Shares (rounded down to the nearest whole number) on thedate during the 10 calendar years following the date of completion of the initialbusiness combination upon the Return to Shareholders exceeding 60% (“Tranche 4
Promote Shares”).

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LETTER TO SHAREHOLDERS
For the purpose of this paragraph, “Return to Shareholders” means the sum of (i) the
appreciation of the per-Share trading price of the Shares following the initial businesscombination (measured as the excess above S$5.00 (the “Reference Price”) of theaverage of the twenty (20) highest daily closing market prices for such shares over any
period of 30-consecutive Market Days that commences after the completion of the initialbusiness combination), and (ii) the cash or fair market value (as applicable) of eachdividend or distribution that has been declared and paid by the Company on the Shares(measured on a per-Share basis as of the date such dividend or distribution was declared)following the initial business combination, with such sum expressed as a percentage of theReference Price.
To minimise dilution arising from the EIS and the Special Bonus Scheme, the Sponsor hasentered into the Deed of Waiver in favour of the Company, pursuant to which the Sponsor
agreed to waive its right to the allotment and issuance of up to 6,310,600 Promote Shares(the “Waived Promote Shares”) to Vertex SPV. The Waived Promote Shares will go
towards the allotment and issuance of (a) up to 2,550,000 EIS Shares, (b) up to 3,560,600
Special Bonus NRS Shares (to be allotted and issued to the Non-Redeeming Shareholders,assuming that none of them redeem their shares as at the Redemption Record Date), and(c) up to 200,000 Special Bonus PIPE Shares (to be allotted and issued to the PIPE
Investors, assuming that the total proceeds raised from the PIPE Financing is
S$10.0 million). If the number of EIS Shares and/or Special Bonus Shares to be allotted andissued by the Company fall below the respective figures specified above, the number ofPromote Shares that the Sponsor will waive its right to will be reduced by the corresponding
number. As the level of Redemption will only be known on or around the Redemption
Record Date, the exact number of Waived Promote Shares, being equivalent to theaggregate of the Allotted EIS Shares and the Actual Special Bonus Shares, will only be
determined on or around the Redemption Record Date. Please refer to Section 29.2 titled“Material Contracts – The Company – Deed of Waiver” of this Circular for details on how thenumber of Waived Promote Shares will be determined. The Company will make anannouncement on SGXNET to disclose the number of Initial Adjusted Maximum Promote
Shares and the number of Final Adjusted Maximum Promote Shares as and when the same
are determined. The vesting schedule for the allotment and issuance of the Final Adjusted
Maximum Promote Shares to Vertex SPV will also be included in such announcement.
In respect of the Waived Promote Shares, it is intended that Vertex SPV waives its right tothe allotment and issuance of the Tranche 4 Promote Shares first. If the number of Waived
Promote Shares exceeds the total number of Tranche 4 Promote Shares, Vertex SPV willthen waive its right to the allotment and issuance of such number of Tranche 3 Promote
Shares as may be necessary. If the number of Waived Promote Shares exceeds the total
number of Tranche 3 Promote Shares and Tranche 4 Promote Shares, Vertex SPV will thenwaive its right to the allotment and issuance of such number of Tranche 2 Promote Sharesas may be necessary. If the number of Waived Promote Shares exceeds the total numberof Tranche 2 Promote Shares, Tranche 3 Promote Shares and Tranche 4 Promote Shares,
Vertex SPV will then waive its right to the allotment and issuance of such number ofTranche 1 Promote Shares as may be necessary. Please refer to Section 29.2 titled“Material Contracts – The Company – Deed of Waiver” of this Circular for further details.
For information on the impact of the waiver of the Promote Shares, please refer to
Section 23.6 titled “Enlarged Group Corporate and Shareholding Structure – Dilution EffectResulting from the Proposed Transactions and the Exercise of the Warrants” of thisCircular.

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5.8

Valuation of the Target Company
The Company has commissioned Frost & Sullivan Limited (the “Independent Business
Valuer”) to undertake an independent business valuation to evaluate the market value of100.0% of the equity interest in the Target Company.
The Independent Business Valuer is of the opinion that the market value of 100.0% of theequity interest in the Target Company as of 30 June 2023 is in the range of US$697.2 million
to US$750.6 million, with a median of US$723.9 million.
The Independent Business Valuer used a combination of the multiple-based valuation anddiscounted cash flow (“DCF”) analysis to determine the value of the Target Company,
considering:(1)

Multiple-based valuation: Multiple-based valuation is a valuation method used todetermine the implied value of the Target Group by considering the market valuationof comparable listed companies as of the Valuation Benchmark Date. Under themultiple-based valuation method, the Independent Business Valuer considered theTarget Company’s industry positioning, product offerings, geographic presence andother factors, and thereafter identified key comparable companies, which comprises
leading global V-Liver agencies and leading interactive live streaming platforms withsignificant presence in Japan and/or rest of Asia.
The Independent Business Valuer believes that price-to-sales (“P/S”) ratio andenterprise value-to-EBITDA (“EV/EBITDA”) are most suitable to evaluate the Target
Company. P/S is commonly used to value live streaming platforms as many
comparable publicly traded companies in the live streaming and V-liver industries arestill unprofitable or at an early stage of profitability. EV/EBITDA was also employed as
the Target Company has generated positive EBITDA since 2020 with an increasingemphasis on profitability.
To derive the implied equity value of the Target Company, the Independent Business
Valuer referenced the price-to-sales ratio and the enterprise value-to-EBITDA multiple
on historical financial performance for the 12 months period ended on the Valuation
Benchmark Date. The equity value of the Target Company was determined byreferencing the valuation multiples of comparable publicly traded companies within thesame industry.
Based on multiple-based valuation, the Independent Business Valuer has concluded
an implied equity value of the Target Company of US$697.2 million to
US$750.6 million.

(2)

Discounted cash flow analysis: DCF represents the present value of the projected
future benefits (including the present value of the terminal value) of the Target
Company. The Independent Business Valuer independently forecasted and projected
the future cash flows of the Target Company based on its evaluation of the Target
Company’s operating metrics and financial performance and by discounting thesecash flows at an appropriate discount rate. The Independent Business Valuer
leveraged the Target Company’s historical operating and financial performance as
disclosed in this Circular, specifically the historical operating metrics (namely, MAU,
Spend Rate and ARPPU) and the development plans of the Target Company for eachof its business segments. Furthermore, as the relevant financial information is73

LETTER TO SHAREHOLDERS
available for each business segment, the Independent Business Valuer was able tounderstand and analyse each business segment and model the financial forecast
accordingly.
Based on the DCF valuation, the Independent Business Valuer has concluded an
implied equity value of the Target Company of US$666.0 million to US$769.0 million.
The Independent Business Valuer had relied on the following general key valuation
assumptions in the DCF analysis:(a)unless otherwise specified in the Valuation Report, abnormal factors that may affectthe assessed value, such as existing or potential mortgages, guarantees, and uniquetransaction structure, have not been considered;(b)there have been no significant changes in the current relevant laws and policies,
industrial policies, and the national macroeconomic situation;(c)the political, economic, and social environment in the region where the assessedsubject is located has remained stable, and there have been no significant adverse
impacts caused by uncontrollable and unforeseeable factors; and(d)there have been no major changes in taxation policies, tax rates, and other policies
applicable to the assessed subject, and the credit policies, interest rates, andexchange rates have remained relatively stable.

In addition to the above assumptions, the Independent Business Valuer had also relied on
business segment-specific assumptions in its financial projections in relation to therespective business segments of the Target Company.
All forecasts and/or financial projections in relation to the Target Company (including its
cash flows, earnings, profits and business) made and/or referred to above, in the Summary
Valuation Letter and the Valuation Report were independently derived by the Independent
Business Valuer, and none of these forecasts and/or financial projections are/were provided
or endorsed by the Company or the Target Company.
Please refer to Appendix M titled “Summary Valuation Letter” of this Circular for further
information on the above valuation methodologies and assumptions.
Assuming that there is No Redemption, the Independent Business Valuer’s opinion of themarket value of 100.0% of the equity interest in the Target Company as set out above
represents approximately 453.5% to 488.3% of the LPD Remaining Escrow Amount (net oftaxes payable on the income earned on the funds held in the Escrow Account), with a
median of 470.9%.
Assuming that there is 50% Redemption, the Independent Business Valuer’s opinion of themarket value of 100.0% of the equity interest in the Target Company as set out above
represents approximately 704.3% to 758.3% of the LPD Remaining Escrow Amount (net oftaxes payable on the income earned on the funds held in the Escrow Account), with a
median of 731.3%.
Assuming that there is Maximum Redemption, the Independent Business Valuer’s opinionof the market value of 100.0% of the equity interest in the Target Company as set out above
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LETTER TO SHAREHOLDERS
represents approximately 1,575.7% to 1,696.4% of the LPD Remaining Escrow Amount (netof taxes payable on the income earned on the funds held in the Escrow Account), with a
median of 1,636.0%.
For completeness, as at the Latest Practicable Date, the total amount of tax payable by theCompany on the interest earned on the funds held in the Escrow Account is S$552,780.
This amount will be fully paid out of the interest earned on the funds held in the Escrow
Account.
While the Independent Business Valuer is not a member of a professional businessvaluation body or association, is not registered with IVAS as a Chartered Valuer andAppraiser and is not regulated by any valuation industry related authority, the Independent
Business Valuer’s independent valuation has been performed in line with recognised
valuation standards (such as the International Valuation Standards). The Independent
Business Valuer has also complied with the disclosure requirements under Practice Note 2(Minimum Disclosure Requirements for Summary Valuation Letters) issued by IVAS in the
preparation of the independent business valuation.
5.9

Status of the Consideration Shares, the Earnout Shares, the EIS Shares, the ESOP
Shares, the PIPE Shares and the Special Bonus Shares
The issuance and allotment of the Consideration Shares, the Earnout Shares, the EIS
Shares, the ESOP Shares, the PIPE Shares and the Special Bonus Shares is subject to,inter alia, the listing and quotation notice thereof on Mainboard having been obtained fromthe SGX-ST. The Consideration Shares, the Earnout Shares, the EIS Shares, the ESOP
Shares, the PIPE Shares and the Special Bonus Shares, upon its issuance and allotment,
will be credited as fully paid-up and free from all encumbrances and will rank pari passu in
all respects with the then existing Shares, save for any rights, benefits, dividends andentitlements attached the record date of which is before the Completion Date.

5.10 Conditions Precedent
Completion of the Proposed Business Combination is conditional upon, amongst others, thefollowing conditions precedent being satisfied or waived on or before Completion(“Conditions Precedent”, and each, a “Condition Precedent”):(a)the Company having obtained Shareholders’ approval at the EGM for the Proposed
Transactions;(b)the Company having obtained the approval of the SGX-ST for Completion of the
Proposed Business Combination pursuant to the terms of the SPA and where suchapproval is subject to conditions, the compliance by the Target Company and (where
relevant) the Company to the satisfaction of the SGX-ST with all the conditions
imposed by the SGX-ST;(c)the Company having obtained the approval of SGX-ST for the listing and quotation of
the Consideration Shares, the PIPE Shares, the Special Bonus Shares, the Earnout
Shares, the ESOP Shares and the EIS Shares on the SGX-ST and where suchapproval is subject to conditions, the compliance by the Target Company and (where
relevant) the Company to the satisfaction of the SGX-ST with all the conditions
imposed by the SGX-ST;

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LETTER TO SHAREHOLDERS(d)the Target Company having rectified or resolved the issues identified through thelegal, financial and tax due diligence conducted by the Company to the reasonablesatisfaction of the Company in its sole and absolute discretion;(e)

the Company having delivered evidence satisfactory to the Vendor that the Completion
Remaining Escrow Amount shall be no less than S$60.0 million; and(f)other conditions precedent customarily included for transactions of a similar nature.

Please refer to Appendix K titled “Terms and Conditions of the SPA” of this Circular for
further details.
5.11

Other Salient Terms of the SPA(a)Representations, Warranties and Undertakings(a)Vendor and Target Company’s Representations and Warranties
The Vendor and the Target Company shall provide customary representations
and warranties to the Company.

(b)Management Warrantors’ Representations and Warranties
The Management Warrantors shall provide customary representations andwarranties to the Company.

(c)Company’s Representations and Warranties
The Company shall provide customary representations and warranties to the
Vendor and the Target Company.

Please refer to Appendix K titled “Terms and Conditions of the SPA” of this Circular for
further details.
5.12 Shareholders’ Approval
The resolution to seek Shareholders’ approval for the Proposed Business Combination isset out in Ordinary Resolution 1 in the Notice of EGM.
The resolutions to seek Shareholders’ approval for (a) the Proposed Allotment andIssuance of the Consideration Shares, (b) the Proposed Allotment and Issuance of the
Earnout Shares, (c) the Proposed Allotment and Issuance of the Base PIPE Shares, (d) the
Proposed Allotment and Issuance of the Special Bonus Shares, (e) the Proposed Adoptionof the EIS, (f) the Proposed Allotment and Issuance of the EIS Shares, (g) the Proposed
Adoption of the Company ESOP and (h) the Proposed Allotment and Issuance the ESOP
Shares are set out in Ordinary Resolutions 2, 3, 4, 5, 6, 7, 8 and 9 in the Notice of EGM.
For the avoidance of doubt, there are no side voting arrangements or agreements, written
or otherwise, entered into by the Company and/or its founding shareholder with other
Shareholders in respect of any of the resolutions to be passed in the Notice of EGM.

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6.

PROPOSED ALLOTMENT AND ISSUANCE OF THE CONSIDERATION SHARES
In partial satisfaction of the Purchase Consideration for the Proposed Business
Combination, and pursuant to the SPA, the Company shall allot and issue 160,162,651
Consideration Shares at the Issue Price to the Vendor (or if the Vendor so nominates, to the
Vendor Shareholders) on Completion.
Assuming that there is No Redemption and that the total proceeds raised from the PIPE
Financing is S$10.0 million, on Completion, the Vendor and/or the Vendor Shareholders
shall collectively hold 160,162,651 Shares, representing approximately 77.2% of theEnlarged Share Capital.
Assuming that there is Maximum Redemption and that the total proceeds raised from the
PIPE Financing is S$10.0 million, on Completion, the Vendor and/or the Vendor
Shareholders shall collectively hold 160,162,651 Shares, representing approximately
91.5% of the Enlarged Share Capital.
Please refer to Section 5.1 titled “Proposed Business Combination – Purchase
Consideration” of this Circular for further details.

7.

PROPOSED ALLOTMENT AND ISSUANCE OF THE EARNOUT SHARES
In partial satisfaction of the Purchase Consideration for the Proposed Business
Combination, and pursuant to the SPA, the Company shall allot and issue up to 24,408,000
Earnout Shares at the Issue Price to the Earnout Shareholders in two tranches on the
Earnout Vesting Dates (starting in 30 April 2024), subject to the Financial Targets for
Earnout achieved by the Target Group.
Assuming that there is No Redemption and that the total proceeds raised from the PIPE
Financing is S$10.0 million, on the last Earnout Vesting Date, the Earnout Shareholders
shall collectively hold up to 184,570,651 Shares, representing approximately 72.7% of the
Fully Enlarged Share Capital.
Assuming that there is Maximum Redemption and that the total proceeds raised from the
PIPE Financing is S$10.0 million, on the last Earnout Vesting Date, the Earnout
Shareholders shall collectively hold up to 184,570,651 Shares, representing approximately
83.1% of the Fully Enlarged Share Capital.
Please refer to Section 5.1 titled “Proposed Business Combination – Purchase
Consideration” and Section 5.2 titled “Proposed Business Combination – The Earnout
Framework” of this Circular for further details.

8.

PROPOSED ALLOTMENT AND ISSUANCE OF THE BASE PIPE SHARES
In connection with the Proposed Business Combination, the Company shall allot and issue
up to 2,000,000 Base PIPE Shares at the Issue Price to the PIPE Investors on Completionby way of a private placement in accordance with Section 272B, Section 274 and Section
275 of the SFA pursuant to the terms of the PIPE Subscription Agreements.
Assuming that there is No Redemption and that the total proceeds raised from the PIPE
Financing is S$10.0 million, on Completion, the PIPE Investors shall collectively hold up to77

LETTER TO SHAREHOLDERS
2,200,000 Shares (comprising the Base PIPE Shares and the Special Bonus PIPE Shares),representing approximately 1.1% of the Enlarged Share Capital.
Assuming that there is Maximum Redemption and that the total proceeds raised from the
PIPE Financing is S$10.0 million, on Completion, the PIPE Investors shall collectively holdup to 2,200,000 Shares (comprising the Base PIPE Shares and the Special Bonus PIPE
Shares), representing approximately 1.3% of the Enlarged Share Capital.
Please refer to Section 5.4 titled “Proposed Business Combination – PIPE Financing” of thisCircular for further details.
9.

PROPOSED ALLOTMENT AND ISSUANCE OF THE SPECIAL BONUS SHARESAssuming that there is No Redemption and that the total proceeds raised from the PIPE
Financing is S$10.0 million, in connection with the Proposed Business Combination, theCompany shall allot and issue up to 3,760,600 Special Bonus Shares at the Issue Price on
Completion, comprising (a) up to 3,560,600 Special Bonus Shares to be allotted and issued
to the Non-Redeeming Shareholders, and (b) up to 200,000 Special Bonus PIPE Shares tobe allotted and issued to the PIPE Investors. On Completion, the Non-Redeeming
Shareholders as well as Vertex SPV (being a Shareholder who is not entitled to exercise theRedemption Right) shall collectively hold up to 45,166,600 Shares, representing
approximately 21.8% of the Enlarged Share Capital, and the PIPE Investors shallcollectively hold up to 2,200,000 Shares, representing approximately 1.1% of the Enlarged
Share Capital.
Assuming that there is Maximum Redemption, and that the total proceeds raised from the
PIPE Financing is S$10.0 million, in connection with the Proposed Business Combination,
the Company shall allot and issue up to 800,000 Special Bonus Shares at the Issue Priceon Completion, comprising (a) up to 600,000 Special Bonus Shares to be allotted andissued to Venezio (being a Shareholder who is not entitled to exercise the Redemption
Right), and (b) up to 200,000 Special Bonus PIPE Shares to be allotted and issued to the
PIPE Investors. On Completion, Vertex SPV and Venezio (being Shareholders who are notentitled to exercise the Redemption Right) shall collectively hold up to 12,600,000 Shares,
representing approximately 7.2% of the Enlarged Share Capital, and the PIPE Investors
shall collectively hold up to 2,200,000 Shares, representing approximately 1.3% of theEnlarged Share Capital.
Please refer to Section 5.3 titled “Proposed Business Combination – Special Bonus
Scheme” of this Circular for further details.

10.

PROPOSED ADOPTION OF THE EXECUTIVE INCENTIVE SCHEME
The Company proposes to adopt an executive share incentive scheme, known as the
Executive Incentive Scheme or EIS. The EIS will commence and take effect only uponCompletion, subject to Shareholders’ approval being obtained at the EGM. Shareholders’approval will be sought at the EGM for the proposed adoption of the EIS (including theallotment and issuance of the EIS Shares subject to and based on the Financial Targets for
EIS achieved). The detailed EIS Rules are set out in Appendix I to this Circular and comply
with the requirements as set out in Chapter 8, Part VIII of the Mainboard Rules. Capitalised
terms used throughout this section, unless otherwise defined in the section titled“Definitions” of this Circular or in this Section 10, shall bear the meanings as defined inAppendix I to this Circular. A summary of the EIS Rules is set out below.
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10.1 Rationale for the EIS
The purpose of adopting the EIS is to incentivise the Key Executives to achieve the key
performance targets (i.e. the Financial Targets for EIS) by providing them with anopportunity to participate in the equity of the Enlarged Group so as to motivate them togreater dedication, loyalty and higher standards of performance, and to give recognition totheir contributions and services. The EIS is proposed on the basis that it is important toretain staff whose contributions are essential to the well-being and continued operations of
the Enlarged Group and to give recognition to the Proposed Directors and the Proposed
Directors and the key employees of the Enlarged Group who have contributed to the growthand profitability of the Enlarged Group.
The Proposed New Board believes that the EIS will be more effective than pure cash
bonuses in motivating the Key Executives of the Enlarged Group to work towards
pre-determined goals.
The objectives of the EIS are as follows:•

to motivate the Key Executives to optimise their performance standards and efficiency
and to maintain a high level of contribution to the Enlarged Group and create value for
Shareholders;•

to retain the Key Executives whose contributions are essential to the long-term growthand profitability of the Enlarged Group;•

to instill loyalty to, and a stronger sense of identification by the Key Executives with theprosperity of the Enlarged Group; and•to align the interests of the Key Executives with the interests of Shareholders.

The duration of the EIS will serve to align the Key Executives’ performance goals with thecorresponding performance cycle of the Enlarged Group, and the strategies and objectives
for the Enlarged Group over the short to medium term. The EIS thus seeks to focus the Key
Executives on short to medium term critical performance targets, to develop a
reward-for-performance culture in the Enlarged Group, and to encourage the Key
Executives to continuously improve their performance. As the actual number of EIS Shares
which the Key Executives will receive under the EIS will depend ultimately on the extent towhich they achieve the Financial Target for EIS set for the relevant EIS Vesting Date, thiscreates a strong incentive for the Key Executives to focus on assigned tasks and to excel.
10.2 Overview of the EIS
Pursuant to the terms of the EIS, each of the Key Executives shall be allocated a certain
number of EIS Shares to be approved by the Proposed New Remuneration Committee
immediately following Completion (the “Maximum Allocation”), which shall be represented
by RSU awards granted immediately following Completion under an award agreement toeach Key Executive, and each Key Executive shall be entitled to be allotted and issued acertain proportion of the Maximum Allocation, as and when the vesting condition under eachof the Financial Targets for EIS set out in the SPA is satisfied. The total number of EIS
Shares to be allocated under the EIS shall be 2,550,000 Shares. The actual number of EIS
Shares to be allotted and issued to the Key Executives will be subject to the Key Executives
remaining in the employment of the Company as at the EIS Vesting Date and the fulfilmentof the Financial Targets for EIS set out in the vesting conditions.

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The Financial Targets for EIS as well as the list of Key Executives and their respective
Maximum Allocation will be agreed by the Company and the Target Company and recorded
in an addendum to the Sale and Purchase Agreement to be entered into prior to Completion
and approved by the Proposed New Remuneration Committee immediately following
Completion. The Key Executives will comprise members of the management team of theEnlarged Group and will include certain members of the Proposed New Board (in particular,
one of the Proposed Non-Executive Directors), certain C-suite executives and otherexecutives of the Company. While the list of Key Executives will be recorded in an
addendum to the Sale and Purchase Agreement prior to Completion, the list of Key
Executives will only be confirmed when the Proposed New Remuneration Committee
approves the same immediately following Completion.
Following the end of each FY and before each EIS Vesting Date, the Proposed New
Remuneration Committee shall determine if the vesting conditions have been satisfied
based on the audited consolidated financial statements of the Company for the applicableyear.
If the Financial Target for EIS as set out in a vesting condition is fulfilled, the Proposed New
Remuneration Committee shall submit its approval and recommendation to the Board forthe allotment and issuance of the relevant number of new EIS Shares to the account of the
Key Executives within 14 Market Days after the applicable EIS Vesting Date.
If the Financial Target for EIS as set out in a vesting condition is not fulfilled, but thefinancial figure(s) achieved is 5% (or less) below the Financial Target for EIS set out against
the vesting condition, the Proposed New Remuneration Committee shall be entitled toproceed with the approval for the allotment and issuance of the relevant number of new
Shares to the account of the Key Executives within 14 Market Days after the applicable EIS
Vesting Date. Granting the Proposed New Remuneration Committee the discretion toproceed with the allotment and issuance of the EIS Shares to the Key Executives
notwithstanding the fact that the financial figure(s) achieved does not meet the Financial
Target for EIS serves to ensure that Key Executives who narrowly miss the Financial Target
for EIS for certain reasons beyond their control (such as the general macroeconomic
outlook, unforeseen circumstances, etc.) are not disproportionately penalised – this isconsistent with the objective of the EIS, which is to align the interest of the Key Executives
with that of the Shareholders post-Completion. In the situation where the Proposed New
Remuneration Committee decides to proceed with the allotment and issuance of the EIS
Shares to the Key Executives where the financial figure(s) achieved is 5% (or less) below
the Financial Target for EIS set out against the vesting condition, the Company will issue anannouncement via SGXNET stating the Proposed New Remuneration Committee’s
considerations in making the decision to proceed with the allotment and issuance of the EIS
Shares notwithstanding the fact that the Financial Target for EIS as set out in a vesting
condition has not been fulfilled. If the Proposed New Remuneration Committee decides not
to proceed with the approval for the allotment and issuance of the relevant number of new
Shares under such situation, the rights of the Key Executives shall be extinguished inrelation to that threshold. For the avoidance of doubt, if the financial figure(s) achieved ismore than 5% below the Financial Target for EIS set out against the vesting condition, therights of the Key Executives to the Shares in relation to that vesting condition shall lapse
and be extinguished.
In the event that any of the Key Executives ceases to be an employee of the Company
during the three-year vesting period, the EIS Shares that have not been allotted and issued
to such Key Executive but which would otherwise have been allotted and issued to such
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Key Executive upon the fulfilment of the vesting conditions will lapse and the total number
of EIS Shares to be allotted and issued under the EIS shall be reduced by thecorresponding number.
For the avoidance of doubt, all other terms of the EIS shall apply to the award of the EIS
Shares.
Summary of the Principal Terms of the EIS
A summary of the principal terms of the EIS is set out below. More detailed information on
the EIS is set out in Appendix I to this Circular (“EIS Rules”).
EIS Participants
The Company may grant the awards to the Key Executives.
Administration of the EIS
The Proposed New Remuneration Committee, as delegate of the Board, will act as theadministrator of the EIS in respect of any awards granted to the employees of the Company,
its subsidiaries and related entities as a whole. The Board delegates certain powers andresponsibilities to the Proposed New Remuneration Committee.
Size of the EIS
In order to reduce the dilutive impact of the EIS, the total number of Shares authorised to
be issued pursuant to EIS Awards awarded under the EIS shall not exceed 2,550,000 EIS
Shares, which shall not, in any event, exceed 15.0% of the total number of issued Shares(excluding Treasury Shares, if any) when aggregated with (a) the total number of EIS
Shares issued and/or to be issued pursuant to EIS Awards already awarded under the EIS;and (b) the aggregate number of Shares which may be granted under any other shareoption scheme or share schemes of the Company, in accordance with Rule 845(1) of the
Mainboard Rules. Shares issued under the EIS shall consist in whole or in part ofauthorised but unissued Shares, Treasury Shares, or Shares purchased on the open market
or otherwise, all as determined by the Company from time to time.
Types of EIS Awards
The EIS will permit the grants of restricted stock units (“EIS RSUs”).
EIS Awards
Each EIS Award shall be evidenced by an Award Agreement, in such form or forms as the
Proposed New Remuneration Committee shall from time to time determine. Without limiting
the foregoing, an Award Agreement may be provided in the form of a notice that provides
that acceptance of the EIS Award constitutes acceptance of all terms and conditions of the
EIS and the notice. Award Agreements granted from time to time or at the same time neednot contain similar terms and conditions but shall be consistent with the terms andconditions of the EIS.
The right of a Grantee to exercise or receive a grant or settlement of any EIS Award, andthe timing thereof, may be subject to such performance conditions as may be specified by81

LETTER TO SHAREHOLDERS
the Proposed New Remuneration Committee which shall include, but is not limited to, hisrank, job performance, years of service, potential for future development, futurecontribution to the success and development of the Company and the extent of effort anddifficulty with which the performance conditions may be achieved. The Proposed New
Remuneration Committee may use such business criteria and other measures of
performance as it may deem appropriate in establishing any performance conditions, andmay exercise its discretion to reduce the amounts payable under any EIS Award subject toperformance conditions.
Restricted Stock Units (“EIS RSUs”)
At the time of grant, the Proposed New Remuneration Committee may, in its sole discretion,
establish a period of time (a “Restricted Period”) and any additional restrictions including
the satisfaction of corporate or individual performance objectives applicable to an EISAward of Restricted Stock Units. Each EIS Award of EIS RSUs may be subject to a different
Restricted Period and additional restrictions. The EIS RSUs may not be sold, transferred,assigned, pledged, or otherwise encumbered or disposed of during the Restricted Period or
prior to the satisfaction of any other applicable restrictions.
EIS RSUs shall be settled in EIS Shares, and the allotment and issuance of EIS Sharesshall be completed within 14 Market Days after the applicable EIS Vesting Date. Unlessotherwise stated in the applicable Award Agreement, holders of EIS RSUs shall not haverights as Shareholders, including no voting or dividend or dividend equivalents rights.
Rights of EIS Shares
New EIS Shares allotted and issued pursuant to an EIS Award shall be eligible for all
entitlements, including dividends, rights, allotments or other distributions declared orrecommended in respect of the then existing Shares from the date of allotment and issueof the EIS Shares, and shall in all other respects rank pari passu with other existing Sharesthen in issue.
Duration of the EIS
The EIS shall be effective as of the date falling on or around 8 December 2023, or suchother date as the Board may determine (“Effective Date”) and shall terminate automaticallyon the three-year anniversary of such date (“Termination Date”).
The Proposed New Remuneration Committee, may at any time and from time to time,amend, suspend, or terminate the EIS as to any EIS Awards which have not been made. No
EIS Awards may be granted after the Termination Date. The applicable terms and conditionsof the EIS, and any terms and conditions applicable to EIS Awards granted before theTermination Date shall survive the termination of the EIS and continue to apply to such EISAwards. No amendment, suspension, or termination of the EIS shall, without the consent of
the Grantee, materially impair rights or obligations under any EIS Award theretofore
awarded.
Changes in Capitalisation
If the number of outstanding Shares is increased or decreased or the Shares are changed
into or exchanged for a different number or kind of shares or other securities of theCompany on account of any rights issue, capital reduction, recapitalisation, reclassification,
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LETTER TO SHAREHOLDERS
stock split or sub-division, reverse split, consolidation of shares, exchange of shares, stock
dividend or other distribution payable in capital stock, or other increase or decrease in such
Shares effected without receipt of consideration by the Company occurring after the
Effective Date, (A) the number and kinds of EIS Shares for which grants of EIS Awards may
be made, (B) the number and kinds of EIS Shares for which outstanding EIS Awards may
be settled, and (C) the performance goals relating to outstanding EIS Awards, shall beequitably adjusted by the Company; provided that no adjustments shall be made is as aresult, the Grantee receives a benefit that a shareholder of the Company does not receive.
Adjustments under the EIS related to Shares or other securities of the Company shall bemade by the Proposed New Remuneration Committee, whose determination in that respect
shall be final, binding and conclusive, and adjustments other than on a capitalisation issue
must be confirmed in writing by the auditors of the Company (acting only as experts and not
as arbitrators) to be in their opinion, fair and reasonable. Unless the Proposed New
Remuneration Committee considers an adjustment to be appropriate, the issue of Sharesor other securities as consideration for an acquisition or a private placement of Shares orother securities shall not normally be regarded as a circumstance requiring adjustment. No
fractional Shares or other securities shall be issued under any such adjustment, and any
fractions resulting from any such adjustment shall be eliminated in each case by rounding
downward to the nearest whole Share.
Annual Report
The Company will make such disclosures in its annual report for so long as the EIS
continues in operation:(a)the names of the members of the committee administering the EIS;(b)

the information required in the table below for the following EIS participants:(a)

EIS participants who are Directors;(b)

EIS participants who are Controlling Shareholders and Associates of Controlling
Shareholder(s); and(c)

EIS participants, other than those in (i) and (ii) above, who have received Sharesissued pursuant to the Awards granted under the EIS and/or RSUs granted under
any other share option scheme or share schemes of the Company which, inaggregate, represent 5.0% or more of the aggregate of the total number of
Shares available under the EIS and any other share option scheme or shareschemes of the Company, collectively;
Name of
Participant

Aggregate
number of EIS
Sharescomprised in
EIS Awards
granted during
the financial
year underreview(including
terms)

Aggregate
number of EIS
Sharescomprised in
EIS Awards
granted sincecommencementof the EIS to
the end of thefinancial year
under review

83

EIS Sharescomprised in
EIS Awards
which havebeen issued
sincecommencementof the EIS toend of thefinancial year
under review

Aggregate
number of EIS
Sharescomprised in
EIS Awards
which have notbeen vested or
exercised as at
the end of thefinancial year

LETTER TO SHAREHOLDERS(c)the names of and number and terms of EIS Shares comprised in the EIS Awards
granted to each Key Executive who receives 5.0% or more of the total number of EISAwards available to all Key Executives under the EIS during the financial year underreview;(d)

the aggregate number of EIS Shares comprised in EIS Awards granted under the EIS
to the Key Executives for the financial year under review, and since thecommencement of the EIS to the end of the financial year under review; and(e)the number and proportion of EIS Shares comprised in EIS Awards granted at a
discount during the financial year under review in respect of every 10% discount rate,
up to the maximum quantum of discount granted; and(f)

an appropriate negative statement in the event the disclosure of any of theabovementioned information is not applicable.

10.3 Rationale for including the Proposed Non-Executive Directors in the EIS
While the Key Executives who are entitled to participate in the EIS will only be confirmedby the Proposed New Remuneration Committee immediately following Completion, there isa possibility that they will include one of the Proposed Non-Executive Directors.
Although the Proposed Non-Executive Directors are not involved in the day-to-day runningof the Enlarged Group’s business, they play an invaluable role in furthering the businessinterests of the Enlarged Group by contributing their experience and expertise. The
participation by the Proposed Non-Executive Director in the EIS will provide the Company
with a further avenue to acknowledge their services and contributions to the Enlarged
Group as it may not always be possible to compensate them fully or appropriately byincreasing the directors’ fees or other forms of cash payment. The grant of EIS Shares to
the Proposed Non-Executive Director will also encourage the retention of the Proposed
Non-Executive Director during the crucial period post-Completion and allow the Enlarged
Group to benefit from their experience and expertise during this period, while motivating the
Proposed Non-Executive Director to take extra efforts to promote the interests of theEnlarged Group and to achieve the Financial Targets for EIS.
10.4 Dilutive Impact of the EIS
Shareholders’ shareholding percentages will be diluted accordingly as a result of theallotment and issuance of EIS Shares pursuant to the EIS depending on the number of EIS
Shares issued. Please refer to Section 23.6 titled “Enlarged Group Corporate andShareholding Structure – Dilution Effect Resulting from the Proposed Transactions and theExercise of the Warrants” of this Circular for further details.
10.5 Modifications to the EIS
The EIS may be modified and/or altered from time to time, subject to the prior approval of
Shareholders in a general meeting, and provided that such modifications and/or alterations
are in compliance with the applicable requirements of Part VIII of Chapter 8 of the Listing
Manual.

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11.

PROPOSED ALLOTMENT AND ISSUANCE OF THE EIS SHARES
In connection with the Proposed Business Combination, and pursuant to the SPA, theCompany shall allot and issue up to 2,550,000 EIS Shares at the Issue Price to the Key
Executives on the EIS Vesting Dates (starting in 30 April 2024) subject to and based on the
Financial Targets for EIS achieved.
Assuming that there is No Redemption and that the total proceeds raised from the PIPE
Financing is S$10.0 million, on the last EIS Vesting Date, the Key Executives shallcollectively hold up to 2,550,000 Shares, representing approximately 1.0% of the Fully
Enlarged Share Capital.
Assuming that there is Maximum Redemption and that the total proceeds raised from the
PIPE Financing is S$10.0 million, on the last EIS Vesting Date, the Key Executives shallcollectively hold up to 2,550,000 Shares, representing approximately 1.1% of the Fully
Enlarged Share Capital.
Please refer to Section 5.1 titled “Proposed Business Combination – Purchase
Consideration” and Section 10 titled “Proposed Adoption of the Executive Incentive
Scheme” of this Circular for further details.

12.

PROPOSED ADOPTION OF THE COMPANY EMPLOYEE SHARE OPTION PLAN
The Company proposes to adopt a share option plan, known as the Company Employee
Share Option Plan (“Company ESOP”). The Company ESOP will commence and takeeffect upon Completion, subject to Shareholders’ approval being obtained at the EGM.
Shareholders’ approval will be sought at the EGM for the Proposed Adoption of theCompany ESOP (including the Proposed Allotment and Issuance of the ESOP Shares). The
detailed Company ESOP Rules are set out in Appendix H to this Circular and comply withthe requirements as set out in Chapter 8, Part VIII of the Mainboard Rules. Capitalised
terms used throughout this section, unless otherwise defined in the section titled“Definitions” of this Circular or in this Section 12, shall bear the meanings as defined inAppendix H to this Circular. A summary of the Company ESOP Rules is set out below.

12.1 Rationale for the Company ESOPThe Target Company currently has in place the 17LIVE Cayman ESOP, pursuant to which
RSUs are issued to the employees of the Target Company. While there are several typesof awards which may be awarded or granted under the 17LIVE Cayman ESOP, namely,
RSUs, options, restricted share awards, dividend equivalents awards, deferred shareawards, share payment awards and share appreciation rights, all of which represent theright to receive shares in the Target Company, none of these awards (save for RSUs) havebeen granted as at the Latest Practicable Date.
As at the Latest Practicable Date, a total of 18,349,125 RSUs have been granted andvested pursuant to the 17LIVE Cayman ESOP (“17LIVE Vested RSUs”). The 17LIVE
Vested RSUs form part of the Sale Shares being acquired by the Company in connection
with the Proposed Business Combination.

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LETTER TO SHAREHOLDERS
As at the Latest Practicable Date, a total of 3,027,215 RSUs have been granted under the
17LIVE Cayman ESOP but have not vested (“17LIVE Unvested RSUs”). Subject toShareholders’ approval being obtained at the EGM for the Proposed Adoption of theCompany ESOP, the Company will assume each 17LIVE Unvested RSU outstanding
immediately prior to the Completion Date, automatically and without any required action on
the part of any holder or beneficiary thereto, and convert such 17LIVE Unvested RSU into
an award of RSUs representing the right to receive Shares in accordance with the Company
ESOP (each, a “Converted RSU Award”). Each Converted RSU Award shall, to the extent
permitted under the Mainboard Rules, continue to have and be subject to comparable terms
and conditions as were applicable to such 17LIVE Unvested RSU immediately prior to theCompletion Date (including vesting conditions and settlement terms), except that each
Converted RSU Award will represent the right to receive such number of ESOP Shares
equal to (y) the number of shares in the capital of the Target Company subject to such
17LIVE Unvested RSU immediately prior to the Completion Date divided by (z) the
Exchange Ratio, and rounded down to the nearest whole number.
The 17LIVE Cayman ESOP will be terminated at Completion and all rights of the 17LIVE
Unvested RSU Holders under the 17LIVE Cayman ESOP will be extinguished.
Pursuant to the Company ESOP, up to 2,114,891 ESOP Shares may be allotted and issued,
being equivalent to the aggregate of (a) 1,799,777 ESOP Shares (calculated based on(i) 3,027,215 17LIVE Unvested RSUs divided by (ii) the Exchange Ratio and rounded to thenearest whole number), and (b) up to 315,114 ESOP Shares to be issued pursuant to theCompany ESOP.
The Company believes that it is desirable for a share option scheme to be implemented by
the Company to provide eligible participants (the “Company ESOP Participants”) with anopportunity to participate in the equity of the Enlarged Group and to provide a greater
flexibility to the Enlarged Group in structuring its staff remuneration package. The Company
recognises that in order to maintain the Enlarged Group’s competitiveness and for the
Enlarged Group to build sustainable businesses in the long term, the Company must beable to continue to attract, motivate, reward and maintain a core group of directors,
executives and employees.
Pursuant to the above, the Company is proposing to introduce the Company ESOP as a
new share option scheme of the Company to commence on Completion subject toShareholders’ approval being obtained at the EGM. The Company ESOP is intended to be
employed by the Enlarged Group to reward, retain and motivate eligible employees(including the Proposed Executive Directors) and the Proposed Non-Executive Directors(including the Proposed Independent Directors), whose services are vital to the well-being
and success of the Enlarged Group.

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The main objectives of the Company ESOP are as follows:(a)motivate Company ESOP Participants to achieve higher efficiency and productivity
and improve the performance of the Enlarged Group and its businesses, with the viewof aligning their interests to those of Shareholders;(b)instill a sense of loyalty to the Enlarged Group in the Company ESOP Participants, andto create an incentive for Company ESOP Participants to work towards the long-termwell-being of the Enlarged Group;(c)increase the competitiveness of the Enlarged Group by giving it the option to use theCompany ESOP as a component in its remuneration and incentive package to attract
and retain key employees, Directors and Executive Officers whose contributions areimportant to the growth and profitability of the Enlarged Group;(d)attract potential employees, Directors and Executive Officers with relevant skills andexpertise to contribute to the management and/or growth of the Enlarged Group; and(e)to give recognition to the contributions made or to be made by employees, Directors
and Executive Officers to the success of the Enlarged Group.

12.2 Overview of the Company ESOPA summary of the Company ESOP Rules is set out below. The detailed Company ESOP
Rules is set out in Appendix H to this Circular.
Company ESOP Participants
The Company may grant the awards to the Company’s employees and members of theboard of directors (“Company ESOP Participants”).
Administration of the Company ESOPThe Proposed New Remuneration Committee, as delegate of the Board, will act as theadministrator of the Company ESOP in respect of any awards granted to the officers,
employees, directors and other eligible persons of the Company, its subsidiaries andrelated entities as a whole.
Size of the Company ESOP
In order to reduce the dilutive impact of the Company ESOP, the total number of Sharesauthorised to be issued pursuant to ESOP Awards awarded under the Company ESOP shallnot exceed 2,114,891 ESOP Shares or such other number of ESOP Shares as may be
authorised by the Proposed New Remuneration Committee, which shall not, in any event,exceed 15.0% of the total number of issued Shares (excluding Treasury Shares, if any)
when aggregated with (a) the total number of ESOP Shares issued and/or to be issued
pursuant to ESOP Awards already awarded under the Company ESOP; and (b) the
aggregate number of Shares which may be granted under any other share option schemeor share schemes of the Company, in accordance with Rule 845(1) of the Mainboard Rules.
Shares issued under the Company ESOP shall consist in whole or in part of authorised but
unissued Shares, Treasury Shares, or Shares purchased on the open market or otherwise,
all as determined by the Company from time to time.
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LETTER TO SHAREHOLDERS
Maximum Entitlements
The aggregate number of ESOP Shares which may be issued pursuant to Awards awarded
under the Company ESOP to grantees who are Associates of Controlling Shareholders
shall not exceed 25.0% of the total number of ESOP Shares available under the Company
ESOP preceding the grant of the relevant new ESOP Shares.
The aggregate number of ESOP Shares which may be issued pursuant to Awards awarded
under the Company ESOP to each Grantee who is an Associate of a Controlling
Shareholder shall not exceed 10.0% of the total number of ESOP Shares available under
the Company ESOP preceding the grant of the relevant new ESOP Shares.
However, it does not necessarily mean that the Proposed New Remuneration Committee
will definitely issue ESOP Shares pursuant to the ESOP Awards awarded under theCompany ESOP up to the prescribed limit. The Proposed New Remuneration Committee
shall exercise its discretion in deciding the number of ESOP Shares to be granted to eachparticipant, which will depend on the performance and value of the participant to the Group.
Types of ESOP Awards
The Company ESOP will permit the grants of options, stock appreciation rights, restricted
shares, restricted share units, other stock-based award or cash award.
ESOP Awards
Each ESOP Award shall be evidenced by an Award Agreement, in such form or forms as the
Proposed New Remuneration Committee shall from time to time determine. Without limiting
the foregoing, an Award Agreement may be provided in the form of a notice that provides
that acceptance of the ESOP Award constitutes acceptance of all terms and conditions of
the Company ESOP and the notice. Award Agreements granted from time to time or at thesame time need not contain similar terms and conditions but shall be consistent with theterms and conditions of the Company ESOP.
The right of a Grantee to exercise or receive a grant or settlement of any ESOP Award, andthe timing thereof, may be subject to such performance conditions as may be specified by
the Proposed New Remuneration Committee which shall include, but is not limited to, hisrank, job performance, years of service, potential for future development, futurecontribution to the success and development of the Company and the extent of effort anddifficulty with which the performance conditions may be achieved. The Proposed New
Remuneration Committee may use such business criteria and other measures of
performance as it may deem appropriate in establishing any performance conditions, andmay exercise its discretion to reduce the amounts payable under any ESOP Award subject
to performance conditions.
ESOP Options
The Option Price of each ESOP Option shall be fixed by the Proposed New Remuneration
Committee and stated in the related Award Agreement. Each ESOP Option shall beseparately designated in the Award Agreement as either an Incentive Stock Option orNonqualified Option if it is awarded to a grantee who is a U.S. citizen or U.S. resident with
U.S. source income. The Option Price of each ESOP Option (except those that constituteSubstitute Awards) shall be at least the Fair Market Value of a Share on the trading date88

LETTER TO SHAREHOLDERS
immediately preceding the Grant Date; provided, however, that in the event that a Grantee
is a Ten Percent Shareholder as of the Grant Date, the Option Price of an Option granted
to such Grantee that is intended to be an Incentive Stock Option shall be not less than 110%of the Fair Market Value of a Share on the Grant Date. In no case shall the Option Price of
any ESOP Option be less than the par value of a Share or at a discount to the Fair Market
Value of a Share on the trading date immediately preceding the Grant Date.
Each ESOP Option shall become exercisable at such times and under such terms andconditions (including, without limitation, performance requirements) as may be determinedby the Proposed New Remuneration Committee and stated in the Award Agreement,
provided that the ESOP Options may be exercisable only after one year from the date of
grant.
Each ESOP Option shall terminate, and all rights to purchase Shares thereunder shallcease, upon the expiration of the ESOP Option term determined by the Proposed New
Remuneration Committee and stated in the Award Agreement not to exceed 10 years fromthe Grant Date, or under such circumstances and on any date before 10 years from theGrant Date as may be set forth in the Company ESOP or as may be fixed by the Proposed
New Remuneration Committee and stated in the related Award Agreement; provided,
however, that in the event that the Grantee is a Ten Percent Shareholder, an ESOP Option
granted to such Grantee that is intended to be an Incentive Stock Option at the Grant Dateshall not be exercisable after the expiration of five years from its Grant Date.
An ESOP Option that is exercisable may be exercised by the Grantee’s delivery of a noticeof exercise to the Company, setting forth the number of ESOP Shares with respect to which
the ESOP Option is to be exercised, accompanied by full payment for the ESOP Shares. To
be effective, notice of exercise must be made in accordance with procedures establishedby the Company from time to time.
Stock Appreciation Rights (“SAR”)
A SAR shall confer on the Grantee a right to receive, upon exercise thereof, the excess of(i) the Fair Market Value of one Share on the date of exercise over (ii) the SAR Exercise
Price. The Award Agreement for a SAR (except those that constitute Substitute Awards)
shall specify the SAR Exercise Price, which shall be fixed on the Grant Date as not less thanthe Fair Market Value of a Share on that date. SARs may be granted alone or in conjunction
with all or part of an ESOP Option or at any subsequent time during the term of such ESOP
Option or in conjunction with all or part of any other Award. A SAR granted in tandem withan outstanding ESOP Option after the Grant Date of such ESOP Option shall have a SAR
Exercise Price that is equal to the Option Price.
The payment of the SAR may be settled in cash or in ESOP Shares, as determined by the
Proposed New Remuneration Committee and set forth in the Award Agreement. The
Proposed New Remuneration Committee will consider settlement of the SAR in cash only
if (i) there are legal or regulatory prohibitions around the issue of ESOP Shares to a Granteeand (ii) the financial position of the Company permits the settlement of the SAR in cash,
including whether the Company was in a net positive cash flow statement at such time an
SAR is being exercised or purchased. For the avoidance of doubt, any SAR that is settled
in cash will not be available for grant again under the Company ESOP. Upon exercise of aSAR, a Grantee shall be entitled to receive payment from the Company (in cash or Shares)
in an amount determined by multiplying: (i) the excess of the Fair Market Value of a Shareon the date of exercise over the SAR Exercise Price; by (ii) the number of ESOP Shares

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LETTER TO SHAREHOLDERS
with respect to which the SAR is exercised. No payment will be made if the Fair Market
Value on the date of exercise is below the SAR Exercise Price.
Restricted Stock and Restricted Stock Units (“ESOP RSUs”)
At the time of grant, the Proposed New Remuneration Committee may, in its sole discretion,
establish a period of time (a “Restricted Period”) and any additional restrictions including
the satisfaction of corporate or individual performance objectives applicable to an ESOP
Award of Restricted Stock or ESOP RSUs. Each ESOP Award of Restricted Stock or ESOP
RSUs may be subject to a different Restricted Period and additional restrictions. The
Restricted Stock and ESOP RSUs may not be sold, transferred, assigned, pledged, orotherwise encumbered or disposed of during the Restricted Period or prior to thesatisfaction of any other applicable restrictions. In no case shall the purchase price be lessthan the par value of a Share.
ESOP RSUs may be settled in cash or ESOP Shares, as determined by the Proposed New
Remuneration Committee and set forth in the Award Agreement. For the avoidance of
doubt, any ESOP RSU that is settled in cash will not be available for grant again under theCompany ESOP. Unless otherwise stated in the applicable Award Agreement, holders of
ESOP RSUs shall not have rights as Shareholders, including no voting or dividend or
dividend equivalents rights, whereas holders of Restricted Stock shall have rights as
Shareholders, including voting and dividend rights.
The Grantee shall be required, to the extent required by applicable law, to purchase
Restricted Stock from the Company at a purchase price equal to the greater of (i) the
aggregate par value of the ESOP Shares represented by such Restricted Stock; or (ii) thepurchase price, if any, specified in the related Award Agreement, provided always that thepurchase price shall not be at a discount exceeding 20% of the Fair Market Value of the
Shares on the trading date immediately preceding the Grant Date.
Rights of ESOP Shares
New ESOP Shares allotted and issued pursuant to an ESOP Award shall be eligible for all
entitlements, including dividends, rights, allotments or other distributions declared orrecommended in respect of the then existing Shares from the date of allotment and issueof the ESOP Shares, and shall in all other respects rank pari passu with other existing
Shares then in issue.
Duration of the Company ESOPThe Company ESOP shall be effective as of the date falling on or around 8 December 2023,
or such other date as the Board may determine (“Effective Date”) and shall terminate
automatically on the 10 year anniversary of such date (“Termination Date”) and may beterminated on any earlier date as provided under the Company ESOP.
The Proposed New Remuneration Committee, may at any time and from time to time,amend, suspend, or terminate the Company ESOP as to any ESOP Awards which have notbeen made. No ESOP Awards may be granted after the Termination Date. The applicableterms and conditions of the Company ESOP, and any terms and conditions applicable to
ESOP Awards granted before the Termination Date shall survive the termination of theCompany ESOP and continue to apply to such ESOP Awards. No amendment, suspension,or termination of the Company ESOP shall, without the consent of the Grantee, materially
impair rights or obligations under any ESOP Award theretofore awarded.

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LETTER TO SHAREHOLDERS
Changes in Capitalisation
If (i) the number of outstanding Shares is increased or decreased or the Shares arechanged into or exchanged for a different number or kind of shares or other securities of theCompany on account of any rights issue, capital reduction, recapitalisation, reclassification,
stock split or sub-division, reverse split, consolidation of shares, exchange of shares, stock
dividend or other distribution payable in capital stock, or other increase or decrease in such
Shares effected without receipt of consideration by the Company occurring after the
Effective Date; or (ii) there occurs any spin-off, split-up, extraordinary cash dividend, orother distribution of assets by the Company, (A) the number and kinds of ESOP Shares forwhich grants of ESOP Awards may be made, (B) the number and kinds of ESOP Shares forwhich outstanding ESOP Awards may be settled, and (C) the performance goals relating tooutstanding ESOP Awards, shall be equitably adjusted by the Company; provided that no
adjustments shall be made is as a result, the Grantee receives a benefit that a shareholderof the Company does not receive.
Adjustments under the Company ESOP related to Shares or other securities of theCompany shall be made by the Proposed New Remuneration Committee, whose
determination in that respect shall be final, binding and conclusive, and adjustments otherthan on a capitalisation issue must be confirmed in writing by the auditors of the Company(acting only as experts and not as arbitrators) to be in their opinion, fair and reasonable.
Unless the Proposed New Remuneration Committee considers an adjustment to beappropriate, the issue of Shares or other securities as consideration for an acquisition or a
private placement of Shares or other securities shall not normally be regarded as a
circumstance requiring adjustment. No fractional Shares or other securities shall be issued
under any such adjustment, and any fractions resulting from any such adjustment shall beeliminated in each case by rounding downward to the nearest whole Share.
Annual Report
The Company will make such disclosures in its annual report for so long as the Company
ESOP continues in operation:(a)the names of the members of the Proposed New Remuneration Committee
administering the Company ESOP;(b)

the information required in the table below for the following Company ESOP
Participants:(i)Company ESOP Participants who are Directors;(ii)

Company ESOP Participants who are Controlling Shareholders and Associatesof Controlling Shareholder(s); and(iii) Company ESOP Participants, other than those in (i) and (ii) above, who havereceived ESOP Shares issued pursuant to the ESOP Awards granted under theCompany ESOP and/or options or awards granted under any other share option
scheme or share schemes of the Company which, in aggregate, represent 5.0%
or more of the aggregate of the total number of Shares available under theCompany ESOP and any other share option scheme or share schemes of theCompany, collectively;

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LETTER TO SHAREHOLDERS
Name of
Participant

Aggregate
number of
ESOP Sharescomprised in
ESOP Awards
granted during
the financial
year underreview(including
terms)

Aggregate
number of
ESOP Sharescomprised in
ESOP Awards
granted sincecommencementof theCompany
ESOP to theend of thefinancial year
under review

ESOP Sharescomprised in
ESOP Awards
which havebeen issued
sincecommencementof theCompany
ESOP to end of
the financial
year underreview

Aggregate
number of
ESOP Sharescomprised in
ESOP Awards
which have notbeen vested or
exercised as at
the end of thefinancial year(c)the names of and number and terms of ESOP Shares comprised in the ESOP Awards
granted to each Director and employee of the Company and its Affiliates who receive
5.0% or more of the total number of ESOP Awards available to all directors andemployees of the Company and its Affiliates under the Company ESOP during thefinancial year under review;(d)the aggregate number of ESOP Shares comprised in ESOP Awards granted under theCompany ESOP to the Directors and employees of the Company and its Affiliates forthe financial year under review, and since the commencement of the Company ESOPto the end of the financial year under review;(e)the number and proportion of ESOP Shares comprised in ESOP Awards granted at a
discount during the financial year under review in respect of every 10% discount rate,
up to the maximum quantum of discount granted; and(f)

an appropriate negative statement in the event the disclosure of any of theabovementioned information is not applicable.

12.3 Rationale for including Controlling Shareholders and/or their Associates in the
Company ESOPThe Company acknowledges that the services and contributions of employees who are
Controlling Shareholders or Associates of the Controlling Shareholders are important to thedevelopment and success of the Enlarged Group. The extension of the Company ESOP toemployees who are Controlling Shareholders or Associates of the Controlling Shareholders
allows the Enlarged Group to have a fair and equitable system to reward employees who
have actively contributed to the progress and success of the Enlarged Group. The
participation of the Controlling Shareholders or their Associates in the Company ESOP willserve both as a reward to them for their dedicated services to the Enlarged Group and a
motivation for them to take a long-term view of the Enlarged Group.
Although participants who are Controlling Shareholders or their Associates may alreadyhave shareholding interests in the Company, the extension of the Company ESOP to
include them ensures that they are equally entitled, with the other employees of theEnlarged Group who are not Controlling Shareholders or Associates of the Controlling
Shareholders, to take part and benefit from this system of remuneration. The Company isof the view that a person who would otherwise be eligible should not be excluded from92

LETTER TO SHAREHOLDERS
participating in the Company ESOP solely by reason that he/she is a Controlling
Shareholder or an Associate of the Controlling Shareholder(s).
The specific approval of the independent Shareholders is required for the proposed
participation of any Controlling Shareholder and/or their Associates in the Company ESOP
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 resolutions must state theactual number of Shares comprised in the specific grant and its applicable terms, as wellas the Company’s rationale for such proposal. In addition, only members of the Proposed
New Board who are not the Controlling Shareholders or Associates of such Controlling
Shareholders will be involved in deliberations and decisions in respect of the RSUs to be
granted to or held by Controlling Shareholders and/or their Associates and the terms andconditions including the performance conditions attached to such RSUs. On the foregoingbasis, the Company is of the view that there are sufficient safeguards against abuse
resulting from the participation of the Controlling Shareholders and/or their Associates in
the Company ESOP.
12.4 Rationale for including the Proposed Non-Executive Directors (including the
Proposed Independent Directors) in the Company ESOP
Although the Proposed Non-Executive Directors (including the Proposed Independent
Directors) are not involved in the day-to-day running of the Enlarged Group’s business,they, nonetheless, play an invaluable role in furthering the business interests of theEnlarged Group by contributing their experience and expertise. The participation by the
Proposed Non-Executive Directors (including the Proposed Independent Directors) in the
Company ESOP will provide the Company with a further avenue to acknowledge andrecognise their services and contributions to the Enlarged Group as it may not always be
possible to compensate them fully or appropriately by increasing the directors’ fees or otherforms of cash payment. The extension of the Company ESOP to the Proposed
Non-Executive Directors (including the Proposed Independent Directors) allows theEnlarged Group to have a fair and equitable system to reward the Proposed Non-Executive
Directors (including the Proposed Independent Directors) of the Enlarged Group who havemade and who continue to make significant contributions to the long-term growth of theEnlarged Group.
The Proposed Directors believe that the extension of the Company ESOP to the Proposed
Non-Executive Directors (including the Proposed Independent Directors) will also enable
the Company to attract, retain and incentivise the Proposed Non-Executive Directors(including the Proposed Independent Directors) to achieve higher standards ofperformance as well as to give recognition to past contributions and services as well as
motivate eligible Proposed Non-Executive Directors (including the Proposed Independent
Directors) generally to contribute towards the long-term growth and profitability of theEnlarged Group.
To minimise any potential conflicts of interest, it is envisaged that the offer of RSUs, andhence, the number of ESOP Shares to be issued and allotted to the Proposed
Non-Executive Directors (including the Proposed Independent Directors), based on thecriteria set out above will be relatively small, in terms of frequency and numbers, and hence,
will not jeopardise the independence of the Proposed Independent Directors. The
Committee may also decide that no RSUs shall be granted in any financial year or no RSUs
may be granted at all.

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LETTER TO SHAREHOLDERS
12.5 Dilutive Impact of the Company ESOPIf approved, the Company will provide that the maximum Shares available under theCompany ESOP, the EIS and all options and awards granted under any other share option,
share incentive, performance share or restricted share plan implemented by the Company
and for the time being in force shall not exceed 15% of the total number issued Shares(excluding Treasury Shares and Subsidiary Holdings) from time to time. Notwithstanding
the above, and for the avoidance of doubt, the Company shall issue only up to 2,114,891
ESOP Shares under the Company ESOP.
Shareholders’ shareholding percentages will be diluted accordingly as a result of theallotment and issuance of ESOP Shares pursuant to the Company ESOP depending on thenumber of ESOP Shares issued. Please refer to Section 23.6 titled “Enlarged Group
Corporate and Shareholding Structure – Dilution Effect Resulting from the Proposed
Transactions and the Exercise of the Warrants” of this Circular for further details.
12.6 Modifications to the Company ESOPThe Company ESOP may be modified and/or altered from time to time, subject to the priorapproval of Shareholders in a general meeting, and provided that such modifications and/or
alterations are in compliance with the applicable requirements of Part VIII of Chapter 8 of
the Listing Manual.
13.

PROPOSED ALLOTMENT AND ISSUANCE OF THE ESOP SHARES
In connection with the Proposed Business Combination, the Company shall allot and issue
up to 2,114,891 ESOP Shares in accordance with the Company ESOP.
Please refer to Section 12 titled “Proposed Adoption of the Company Employee Share
Option Plan” of this Circular for further details.

14.

INFORMATION ON THE TARGET COMPANY

14.1 History and Milestones
The Target Company, formerly known as M17 Entertainment Limited, was incorporated
pursuant to the Cayman Companies Act as a Cayman Islands exempted company withlimited liability on 28 February 2017.

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The following table sets out selected milestones of the Target Group:Year

Milestones

2015

Machipopo, Inc. (now known as Ichi Nana Inc.) was incorporated in the
British Virgin Islands and launched the live streaming platform 17 Media in
Taiwan.
17 Media (H.K.) Limited (now known as 17LIVE HK) was incorporated in
Hong Kong as the operating subsidiary of the live streaming business inHong Kong.
Machipopo, Inc. Taiwan branch (now known as Ichi Nana Inc. Taiwan
Branch) was established in Taiwan as the operating subsidiary of the live
streaming business in Taiwan.

2017

Machipopo, Inc. merged with Paktor Pte. Ltd., a dating and social
networking platform in Singapore. As a result of this merger,
M17 Entertainment Limited was incorporated as the holding company ofMachipopo, Inc. and Paktor Pte. Ltd..
The Target Company’s live streaming business expanded to the rest of
Asia, including Japan and Hong Kong.
17 Media Japan Inc. (now known as 17LIVE Japan Inc.) was established as
the operating subsidiary of the live streaming business in Japan.
The Target Group started producing original in-house shows featuring live
streamers who won online competitions.

2018

Wave Inc. was established in Taiwan to operate Wave, an audio-centric live
streaming and social platform owned by the Target Group. The Target
Group launched Wave in 2019.
The Target Group launched its V-Liver content as a genre to allow
interactions among V-Livers, live streamers and users.

2019

HandsUp Inc. was established to operate the Taiwan live commercebusiness, which was later expanded to Japan at the end of 2019.

2020

The Target Company rebranded from M17 Entertainment Limited to 17LIVE
Inc. as part of its global strategy and future development plans.
The Target Company sold its entire shareholding in Paktor Pte. Ltd. tofocus on its live streaming business.
The Target Company acquired Next Entertainment Global Holding, acompany incorporated in the Cayman Islands, which held MeMe Live, a live
streaming platform with operations in India, Japan, Taiwan and the PRC.(1)The Target Group diversified and localised its offerings at the onset of the
COVID-19 pandemic, including investing in more V-Liver content in Japanand inviting politicians to stream in Taiwan.
The Taiwan operation of HandsUp Inc. was rebranded to OrderPally, a B2B
live commerce matching and order management SaaS platform.

2021

In October 2021, the Target Group was selected by the National
Development Council of Taiwan as one of the nine “NEXT BIG” (新創明日之星) start-ups representing Taiwan.

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LETTER TO SHAREHOLDERS
Year

Milestones

2022

The Target Group introduced a variety of in-app games on its Taiwan andJapan platforms in May 2022 and August 2022 respectively, such as “Fruit
Farm” and “Onmyoji”.
The Target Group launched Wave in Japan.
The Target Group achieved a breakthrough in the live commerce industry
in Japan by being the first live streaming platform in Japan to sell cars
through live commerce.

2023

The Target Company integrated the Live2D functions into its V-Liverbroadcasting functionality, which allows users to use their own
smartphones to upload an avatar and conduct virtual streaming. The Target
Group further enhanced its V-Liver broadcasting functionalities byintegrating VRM3D and hand gesture recognition functions.
MeMe Live was integrated into 17LIVE to achieve greater synergy between
the two live streaming businesses.(2)The Target Group introduced 17Shop as a marketplace to 17LIVE.

Notes:(1) The Target Company acquired Next Entertainment Global Holding from an independent third party.
(2) Upon the integration of MeMe Live into 17LIVE, Next Entertainment Global Holding became a dormant
holding company, which does not and will not have any business operations.

14.2 Introduction
The Target Company’s Mission
The Target Company’s mission is to empower human connections.
Life takes place in real time connections. The Target Company empowers authentic
expressions that build borderless human connections and captures these irreversible
moments through live technology.
Overview
The Target Group operates 17LIVE, which is the top pure-play live streaming platform(by revenue) in Japan and Taiwan combined. Its business lines include Liver live streaming,
V-Liver live streaming and other businesses. According to the IMR Consultant, the Target
Group commanded a top market share by revenue of 20.8% in Japan in 2022 and asignificant market share by revenue of 26.9% in Taiwan in 2022. 17LIVE is accessible
globally, and the Target Group’s key markets of operations include Japan and Taiwan, witha presence in Hong Kong, Singapore, the U.S., the Philippines, India and Malaysia, as of
30 June 2023.
For 1H FY2023, the Target Group had an average MAU of approximately 550,000 and asof 30 June 2023, it had approximately 87,000 Contracted Streamers.
17LIVE is the Target Group’s flagship product launched in July 2015 and August 2017 for
Taiwan and Japan respectively. The Target Group has fostered a diverse live streaming
ecosystem with a loyal and engaged user community, as well as a deep pool of live
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LETTER TO SHAREHOLDERS
streamers. For 1H FY2023, the Average Daily View Duration Per DAU was approximately
93 minutes on a monthly average basis.
To drive continued engagement within this ecosystem, the Target Group strives to localise
its products and content, and has introduced innovative business initiatives such as
V-Livers, in-app games and live commerce which are highly synergistic with its core live
streaming business and act as drivers for future sustainable growth of the Target Group’sbusiness.
The diagram below illustrates the self-reinforcing ecosystem supported by the Target
Group’s live social entertainment platforms:

V-LiverLive streaming

~550k

~87k

Total MAUs1

Contracted Streamers2

In-appGames

Live
Commerce

Notes:(1) Average for 1H FY2023.
(2) As of 30 June 2023.

Live streamers are at the core of the Target Group’s business. In addition to providing its
live streamers with a platform that is accessible globally through which they can interact
with their viewers, the Target Group also provides a full suite of powerful, easy-to-use
interface and services, empowering its live streamers to create high-quality and attractive
content. In addition, the Target Group provides in-house training and styling services to its
live streamers, and has created an end-to-end management system to develop and nurture
its live streamers. The Target Group’s contract model with live streamers helps ensure a
consistent supply of diversified content, which is effectively supplemented by the talentagency model that captures a large group of promising and rising live streamers. For
1H FY2023, the average Contracted MAS was approximately 14,000 and since FY2021, theaverage monthly streaming hour per Contracted MAS consistently exceeds 40 hours.
Please refer to Section 14.3 titled “Information on the Target Company – Business Overview

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LETTER TO SHAREHOLDERS– The Target Group’s Business Lines – Live Streaming – Live Streamers – Live Streamer
On-boarding” of this Circular for further details.
The Target Group believes that live streamers choose to showcase their talent on 17LIVE
for its strong brand recognition and unique value propositions to help them createhigh-quality and more relevant content, all of which drive further user growth andengagement. 17LIVE enables users to interact and socialise with live streamers and otherusers and show their support and appreciation to the live streamers by sending virtual gifts,
which results in successful monetisation for the live streamer. The Target Group’s
multi-channel monetisation model includes virtual gifting and subscription to both live
streamers and V-Livers, as well as sale of virtual game equipment and tools within in-app
games. As a result of this powerful ecosystem, 17LIVE has been able to scale from strength
to strength. For 1H FY2023, the average monthly Spend Rate was 16.1% with an averagemonthly ARPPU of approximately US$302.
In 2018, the Target Group further expanded its streamer verticals by introducing V-Livercontent on 17LIVE. V-Livers combine virtual and real interactions to create an immersive
experience for users to foster a thriving community. The V-Liver segment became a focusof the Target Group’s business growth plans in 2022. In April 2023, the Target Group
officially integrated the Live2D functions into its broadcasting functionality, which allows
users to use their smartphones to upload an avatar and conduct virtual streaming without
any additional hardware or software, thereby significantly lowering the barriers to becoming
a V-Liver. In June 2023, the Target Group organised an offline V-Liver performance in
Ikebukuro, Tokyo, where live streamers and V-Livers performed on stage together. In July
2023, 17LIVE created its first five V-Liver proprietary IPs under the name BUSHILIVE.
Following the integration of Live2D functions, the marketing of BUSHILIVE prior to its
official launch and the offline V-Liver event, the Target Group saw significant growth in its
V-Liver business, in particular its talent pool of V-Livers, V-Liver viewer base andengagement. As a result of such initiatives, for Q2 2023, average V-Liver MAS wasapproximately 2,000, representing a YoY increase by 6.5 times, average V-Liver MAU
reached approximately 75,000, representing a YoY increase by 2.1 times, and averagemonthly V-Liver Spender was approximately 30,000, representing a YoY increase by
2.7 times. In August 2023, the Target Group further enhanced its broadcasting
functionalities by integrating VRM3D and hand gesture recognition functions in order tocreate an immersive experience for users with V-Livers.
The Target Group first launched its in-app games on 17LIVE in Taiwan in May 2022 which
included two main genres of in-app games, being half-screen casual games and half-screeninteractive games. These in-app games were gradually rolled out to different markets since
the launch. For 1H FY2023, the average monthly Game Penetration Rate was 25.5%.
The Target Group also operates its live commerce business through (i) HandsUp andOrderPally, and (ii) 17Shop. HandsUp is a platform in Japan that allows merchants to sell
their products through live streaming, and OrderPally in Taiwan, is a B2B live commerce
matching and order management SaaS platform connecting merchants and users. As of
30 June 2023, HandsUp and OrderPally served 918 merchants. In July 2023, 17LIVE
launched 17Shop, a marketplace within 17LIVE through which the Target Group generates
revenues from commission arrangements with merchants. The Target Group has fosteredrelationships with local merchants and brands through HandsUp and OrderPally while
maintaining a strong network with local live streamers who are able to endorse products
effectively through their large fan base. 17Shop serves as a synergistic platform connecting
merchants and live streamers to enhance business collaborations and opportunities. These
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LETTER TO SHAREHOLDERS
channels effectively supplement each other and allow for potential future stronger
monetisation opportunities. The Target Group has a proven track record of monetisation
through its highly interactive and engaging entertainment content on its platforms.
The Target Group embraces cultural nuances and user tastes and strives to localise its
products and content for each market in which the Target Group operates. With local
operating teams based in Japan, Taiwan, Hong Kong, Singapore, the U.S. and India, theTarget Group is well-positioned to understand and meet users’ diversified and ever-evolving
needs. This has been instrumental in attracting a large base of loyal and highly engaged
users.
The Target Group is a technology-driven live social entertainment platform. The Target
Group’s big data analytic capabilities take advantage of prodigious data generated by its
users in order to improve its services to users, including providing interest or location-based
recommendations for a personalised user experience. SkyEye, a dedicated content
monitoring team of the Target Group, is aided by proprietary AI-powered content screening
systems to monitor the contents posted by, and the behaviour of, live streamers and users
on its platforms. Please refer to Section 14.3 titled “Information on the Target Company– Business Overview – The Target Group’s Business Lines – Live Streaming – Content
Management and Monitoring – Human Screening” of this Circular for further details. The
Target Group’s services meld data analytics with refined operational know-how, offering its
live streamers insightful advice on their content and performance to increase engagementwith the audience.
Value Propositions
The Target Group is well-positioned to support its live streamers and to meet the needs of
its users due to the strengths of the Target Group’s live social entertainment platforms andits online ecosystem. By building a large community of users, the Target Group enjoys
network effects and virtuous cycles: the more users use 17LIVE, the more vibrant the live
online social entertainment ecosystem becomes and the greater the value 17LIVE offers to
its live streamers and users, which in turn attracts even more live streamers and users to
17LIVE.

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LETTER TO SHAREHOLDERS
The diagram below illustrates the unique value propositions offered by the Target Group to
live streamers, users, and merchants and business partners:
High user engagement and stickiness

Loyal streamer community

Real-time,l iunediteddinteractions

R b
Robusttalentlmanagement
Unique user
experience

Empowercreation

Users

Streamers

Online andoffline events

Uniqueexposure to
brand partners

Showcase talentbuilding fameHigh quality
content

Ecosystem partners

Targeted user reachHigh willingness
to payDiverse talented
streamers

Influential streamers
among the community

Strong brand recognitionin Taiwan and JapanTo Live Streamers, 17LIVE empowers content creation through•Leveraging a large platform to showcase their talents in front of a large user base.

•

Providing end-to-end talent management.

•

Providing opportunities to work and partner with brands and celebrities which increase
their exposure.

To Users•

Easy-to-use interface allow real-time connections.

•

Enjoying diverse, localised and high quality content provided by the Target Group’s
talented live streamers or by the Target Group itself.

•

Exciting and immersive experience of tactile online and offline events.

To Merchants and Business Partners•

Leveraging 17LIVE’s status as a top live streaming platform to access a ready pool ofhigh quality users with strong propensity to spend.

•

Large pool of talented live streamers fitting the 17LIVE brand image.

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LETTER TO SHAREHOLDERS•

Leveraging the familiarity and trust between users and live streamers to distribute livecommerce products.

•

Strong brand recognition in Japan and Taiwan as the leading live streaming platform.

14.3 Business Overview
The Target Group’s Markets
The Target Group operates in various countries and regions across the world with Japanand Taiwan as its core markets.
The following table sets forth a breakdown of the Target Group’s total revenue by region andeach expressed as a percentage of its total revenue for FY2020, FY2021, FY2022,
1H FY2022 and 1H FY2023:
FY2020FY 2021

FY 20221H FY2022

1H FY2023(US$ in million, except for percentages)(Audited)(Unaudited)

Japan

285.8

69.5%

364.9

73.3%

251.9

69.3%

140.2

70.0%

103.9

68.8%

Taiwan

71.0

17.3%

86.7

17.4%

86.8

23.9%

44.9

22.4%

38.2

25.3%

Rest of World

54.5

13.2%

46.2

9.3%

25.0

6.8%

15.3

7.6%

8.9

5.9%

Total

411.4

100%

497.8

100%

363.7

100%

200.4

100%

151.0

100%

Japan
According to the IMR Consultant, 17LIVE is the top pure-play live streaming platform by
revenue in Japan in 2022, occupying a market share of 20.8% by revenue. Japan is one of
the Target Group’s two core markets and contributes 69.3% of the Target Group’s total
revenue in the financial year ended 31 December 2022.
TaiwanAccording to the IMR Consultant, 17LIVE commands a market share of 26.9% by revenue
in the Taiwan pure-play live streaming industry in 2022. Revenues from Taiwan accounted
for 23.9% of the Target Group’s total revenue for the financial year ended 31 December
2022.
The Target Group’s Business Lines
The Target Group primarily operates the following three business lines: Liver live streaming,
V-Liver live streaming and other businesses. The Target Group generates revenues
primarily from its live streaming businesses (including both Livers and V-Livers) by selling
virtual points to its users, who in turn use them to purchase virtual gifts for their favourite
live streamers and V-Livers or play in-app games. V-Liver live streaming enables real-time
interaction between users and virtual characters. As part of the Liver live streaming and
V-Liver live streaming businesses, the Target Group also offers in-app games which users
can play while watching live streams, or which users can play together with live streamers

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LETTER TO SHAREHOLDERS
and V-Livers. The Target Group also generates revenues from its live commerce business,
which builds connections between brands and users.
Liver live streaming constitutes the majority of the Target Group’s total revenue. It is the
backbone of the Target Group’s business and forms a robust foundation of the growth ofother businesses. The following table sets forth a breakdown of the Target Group’s total
revenue by business line and each expressed as a percentage of its total revenue for
FY2020, FY2021, FY2022, 1H FY2022 and 1H FY2023:
FY2020FY 2021

FY 20221H FY2022

1H FY2023(US$ in million, except for percentages)(Audited)(Unaudited)

Liver Live
Streaming(1)

406.9

98.9%

489.7

98.4%

354.6

97.5%

195.6

97.6%

146.0

96.7%

V-Liver Live
Streaming(2)

2.9

0.7%

3.3

0.7%

3.1

0.9%

1.9

0.9%

1.5

1.0%

Other
businesses(3)

1.5

0.3%

4.7

0.9%

6.0

1.6%

3.0

1.5%

3.4

2.3%

Total

411.4

100%

497.8

100%

363.7

100%

200.4

100%

151.0

100%

Notes:(1) Liver Live Streaming business comprises of revenues from virtual gifting, subscription and in-app games.
(2) V-Liver Live Streaming business comprises of revenues from virtual gifting, subscription and in-app games.
Due to current technical limitations, as of the Latest Practicable Date, the operating revenue which the Target
Group generates from in-app games in V-Liver live streaming offerings has been consolidated into thebusiness segment of Liver live streaming. The Target Group aims to have data infrastructure in place to trackthe operating revenue which the Target Group generates from in-app games in Liver live streaming and
V-Liver live streaming offerings separately starting from 2024.
(3) Other businesses comprise of revenues from live commerce and Wave.

Live Streaming
The Target Group provides live streaming services through the 17LIVE mobile application
which is available on iOS App Store and Google Play, and the 17LIVE website. Together,
these mobile applications and website are accessible to live streamers and users globally.
17LIVE enables users to interact and socialise with live streamers and other users directly
through their mobile devices and the 17LIVE website. While live streamers are streaming,
users can send in-stream instant messages and give virtual gifts to show their support.
Users can also join the fan group of their favourite live streamers and become an “armysubscriber” by paying a subscription fee on a monthly basis. A user who is an “armysubscriber” will enjoy special privileges, which vary depending on the value of thesubscription plan. Please refer to Section 14.3 titled “Information on the Target Company– Business Overview – The Target Group’s Business Lines – Live Streaming – Features of
the Target Group’s Platforms – Army” of this Circular for further details. A variety of in-app
games are available on 17LIVE, including half-screen casual games that users can playwhile simultaneously watching live streams, and half-screen interactive games that users
can play together with the live streamers. The Target Group also hosts online competitions

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LETTER TO SHAREHOLDERS
and offline events in which users, by giving virtual gifts, can help their favourite live
streamers win the online competitions for a variety of rewards such as an opportunity toattend the offline events.
Live Streamers
Live streamers are the predominant content producers on 17LIVE. Live streamers
streaming on 17LIVE include those with a wide variety of talents, such as music, games,
education, fashion, art, chatting, handcrafting, fortune telling, lifestyle and cooking, as wellas those who do not showcase special talent but want to share the moments of their lives
or interesting experiences with a broader group of people.
Live streamers are offered the opportunity to enter into contracts with the Target Group.
These live streamer contracts are mostly standardised, binding Contracted Streamers
within the same countries and regions with similar terms and including standard terms suchas obligations to comply with the Target Group’s content protection policies, confidentiality
obligations and other corporate policies. These contracts are generally renewed annually,and provide for a pre-agreed percentage of revenue to be shared with the live streamers.
The Target Group also has the discretion to grant bonuses to the live streamer if he/shereaches a pre-determined target of streaming hours or receives a certain amount of virtual
gifts. The live streamer contracts can also be exclusive or non-exclusive to the Target
Group. Live streamers which are exclusive to 17LIVE generally enjoy better contractual
terms as compared to non-exclusive live streamers. Currently, there are less thanten legacy contracts which were negotiated on a one-on-one basis and are being phased
out – these legacy contracts provide live streamers with a larger revenue share andperformance bonuses. The Target Group intends to phase out these legacy contracts by theend of 2024.
Live Streamer On-boarding
The Target Group encourages everyone to join its community and live stream on its
platforms. Any user can register as a live streamer on 17LIVE through their accounts on
various social media platforms and start live streaming. The Target Group conducts
verification of live streamers through the application programming interface of social media
platforms. Contracted Streamers are required to complete identity verification steps prior toentering into contracts with the Target Group, such as providing his/her identity card
number, residential address, contact number and email address, and confirming whether
he/she has a criminal record or not. The Target Group has a live streamer referralprogramme and partnerships with various third party agencies globally for recruitment oflive streamers, complemented with recruitment campaigns and auditions.

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Live Streamer Cultivation
The Target Group has developed a robust end-to-end talent management system forContracted Streamers to teach them how to develop quality and meaningful content which
is appreciated by users. This begins with a three-part training programme designed with theaim of upskilling these Contracted Streamers, and supplementing them with greater
exposure by providing them with the opportunities to attend online competitions and offline
events. The Target Group also organises offline live streamer gatherings for live streamers
to interact with each other. The diagram below illustrates the talent management system of
the Target Group:
1

6

Scouting

Mentorship

2Interviews

3

Contract

Full life-cycle talentmanagement capabilities

5

Uniqueexposure

4

Contract compensation

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LETTER TO SHAREHOLDERS
The first part of the three-part training programme provides live streamers with the basic
knowledge required to effectively use the platforms for streaming, which includes setting up
the right streaming environment and utilising product features to enhance streaming quality.
The second part is the advanced training programme which provides in-depth analytical
data to help live streamers review their own performance, instructs live streamers on how
to manage and interact with users and top spenders, and trains other skills such as target
audience analysis, self-media marketing and self-positioning. The final part is the specificgenre training programme, which is usually provided by third party agencies engaged by theTarget Group, and tailored to help live streamers cultivate their own skills in areas such as
singing, hosting or modelling.
In addition to the three-part training programme, the Target Group also arranges a large
variety of personal development activities for its Contracted Streamers, such as(i) handcrafting classes for the live streamers to handmake gifts for their top viewers,(ii) pose and etiquette lessons, and (iii) coaching by famous singers and organising musicshows to further develop and showcase live streamers’ singing talents.
Live Streamer Retention
In order to retain popular live streamers, the Target Group established a “Top Live Streamer
Welfare Committee”, which is responsible for providing consultation services and additional
incentives to top live streamers. Top live streamers have regular one-on-one meetings withdedicated agents to discuss their content and career development.
To enhance competitiveness, the Target Group has a dedicated team that monitors top live
streamers on other live streaming platforms and observes market trends. The Target Groupalso collaborates with talent agencies or multi-channel network corporations on featured
live streaming, where the Target Group invites their artists and celebrities to live stream onsuch featured channels. For example, in Japan, the Target Group collaborated withJapanese pop singer Takanori Nishikawa (西川貴教) and launched an exclusive live stream
series named Nishinana Live in 2021.
Case Studies
岸田直樹

Naoking – Longest-serving Male Live Streamer on 17LIVE in Japan

Naoking started streaming on 17LIVE in 2017 and is the longest-serving male streamer on
17LIVE in Japan, having live streamed for more than 2,000 consecutive days. He
specialises in lifestyle sharing. The Target Group identified Naoking as a promising andrising live streamer when he first started streaming on 17LIVE and has since then supported
him in many ways, including providing live streaming training, personalised planning in
relation to promotion strategies, and featuring him on billboards located in public transport,
as well as the Target Group’s online and offline events in Japan. Naoking has now growninto a top live streamer on 17LIVE with a strong and wide-spread fan base. With
approximately 771,000 followers on 17LIVE as of 30 June 2023, his ambition is to become
the most supported live streamer worldwide. He is widely popular and has won the overall
champion of “Super Live Stream Festival 2021”, which was the biggest mixed-gender event
organised by the Target Group. Live streamers were previously generally known as“streamers” in Japan, until he coined the term “livers”, which is the prevailing term used in
the Japan live streaming industry today. His influence extends beyond live streaming as he

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has also garnered a strong following on different social media platforms. He is an inspiration
for young live streamers and also runs a live streamer agency which scouts and trains
potential talents.

楊淨宇Angel – Singer

Angel started streaming on 17LIVE in 2020 and is a charismatic singer in Taiwan who found
fame and fulfillment through 17LIVE. Audiences witnessed Angel’s transformative journeyfrom a street performer to a digital sensation. The Target Group provided professionalmusic training courses to Angel to further improve her singing and performance skills.
Through offline events and unique exposure opportunities, the Target Group gave heraccess to a wider audience, helped her foster a dedicated fan community and built up her
reach and influence as an artist. Her growing popularity and talent resulted in her
consistently high rankings on 17LIVE’s leaderboard and victory in the “Singing Paradise 2”
contest in 2022. As of 30 June 2023, Angel had approximately 50,000 followers. Byleveraging on 17LIVE, Angel was able to turn her passion into a professional pursuit andshape her singing career. Her story is an inspiring tale of successfully leveraging her talents
and 17LIVE to transform her dreams into reality.

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LETTER TO SHAREHOLDERSUsers
The Target Group believes that its widely-recognised brand image, diversified content andunique user experience have contributed to its user growth. 17LIVE offers popularinteractive social features to users, such as real-time messaging, sending virtual gifts and“army” subscription to their favourite live streamers.
These real-time interactive features, coupled with a wide variety of high quality content,
help the Target Group create a vibrant and loyal social community that creates a sense of
belonging which in turn enhances user retention and promote engagement.
To further enhance user retention and engagement, the Target Group has launchedtier-based loyalty programmes to reward users according to their view duration and Spend
Rate. Furthermore, the Target Group has also launched various user-targeted promotion
and subscription packages to convert users to paying customers.
The following table sets out the Target Group’s average MAU and the average Quality MAU
as % of MAU for the half-yearly periods from FY2020 up to 1H FY2023.
1H
FY20202H
FY20201H
FY2021

2H
FY2021

1H
FY20222H
FY2022

1H
FY2023

1,118
658
244

1,255
848
198

784
508
123

1,533
573
141

1,149
401
121

624
299
107

550
245
92

Quality MAU as % of MAU
Japan
1.2%
Taiwan
3.5%

1.6%
4.5%

3.8%
7.6%

4.8%
7.2%

7.8%
9.0%

11.6%
10.8%

14.4%
12.9%

MAU (’000)
Target Group– Japan– Taiwan

As a result of the COVID-19 pandemic in FY2020, people spent more time at home due tosocial distancing measures and lockdowns and turned to consuming digital content. The
Target Group was able to therefore significantly grow its MAU and MAS as well as increase
its market presence in the live streaming market in Japan and Taiwan which ultimately
increased the competitiveness of the Target Group. As the COVID-19 pandemic restrictions
began to ease in the later part of FY2021 and FY2022 and coupled with the relatively higher
market penetration rate of the Target Group’s core businesses, the cost of acquiring newusers began to increase. As a result, the Target Group intentionally shifted its strategy tofocus on profitability and return on user acquisition, which led to an increase in its Quality
MAU, Spend Rate and ARPPU, ultimately enhancing the Target Group’s profitability.
The following table sets out the Target Group’s average MAU and the average Quality MAU
as % of MAU for FY2020, FY2021 and FY2022:
FY2020

FY2021

FY2022

Target Group

1,187

1,159

886

– Japan

753

540

350

– Taiwan

221

132

114

MAU (’000)

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LETTER TO SHAREHOLDERS

FY2020

FY2021

FY2022

Japan

1.4%

4.3%

9.7%

Taiwan

4.0%

7.4%

9.9%

Quality MAU as % of MAU

Features of the Target Group’s Platforms
17LIVE has a user friendly interface that allows all users to access live streaming content
with a few simple clicks. The following screenshots from 17LIVE demonstrate the simplicityof the on-boarding process onto 17LIVE:Interaction and Socialisation
17LIVE enables users to interact and socialise with live streamers and other users directly
through their mobile devices.
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LETTER TO SHAREHOLDERS
Other than real-time messaging and virtual gifting, the Target Group has introduced
gamified features into its platforms. For instance, users can bid to be the “guardian knight”
of their favourite live streamer, allowing them to serve as the main patron of the live
streamer and assist the live streamer in socialising with the audience by chatting with
newcomers and encouraging them to stay and support the live streamer. Live streamers
who achieve certain level of popularity with their fans can receive rewards, which
incentivise them to engage with users.
In addition, live streamers can archive their live streaming sessions and allow users who
are unable to attend the sessions in real-time to watch them later. Users can also show theirsupport through archive gifting when watching archived sessions, which allows live
streamers to receive virtual gifts even when they are not live streaming.
The following table sets out the Target Group’s Average Daily View Duration Per DAU on amonthly average basis for the half-yearly periods from FY2020 up to 1H FY2023. 17LIVE
has interactive features such as polls, gacha gift (varied virtual gift packages), and in-app
games that increase interaction and engagement between live streamers and users. Suchengaging experience encourages users to stay in the live stream for a longer duration.
1H
FY20202H
FY20201H
FY2021

2H
FY2021

1H
FY20222H
FY2022

1H
FY2023

Average Daily View Duration Per DAU (minutes)
Target Group

71

67

82

87

101

101

93

– Japan

82

70

86

96

108

103

101

– Taiwan

61

65

69

72

82

80

82

The following table sets out the Target Group’s Average Daily View Duration Per DAU on amonthly average basis for FY2020, FY2021 and FY2022:
FY2020

FY2021

FY2022Average Daily View Duration Per DAU (minutes)
Target Group

69

84

101

– Japan

76

91

106

– Taiwan

63

70

81

Gifting
17LIVE features a virtual gifting function, where users purchase virtual points on its
platforms which can be exchanged into virtual gifts and sent to live streamers.
These virtual gifts mimic real-life goods and luxuries ranging from flowers to yachts todifferentiate their rarity and value. Certain virtual gifts are AR-enabled which allow
customisation and filters to be layered on top of live streamers’ faces. These virtual gifts
float across the screen of the streaming room with special visual and/or sound effects
drawing the attention of the other users in the streaming room. The virtual gifts can beexchanged using virtual points at different prices and virtual points can be purchased on
17LIVE in different packages.
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LETTER TO SHAREHOLDERS
The following screenshots demonstrate the diversity of virtual gifting functions on 17LIVE:

Limited gift

Go-Kart gift

Tipping gift

Gacha gift

Live streamers can receive a portion of the corresponding economic value of the virtual giftsthat they have received through their revenue sharing arrangements with the Target Group.
The emphasis on Quality MAU necessitates a shift by the Target Group to focus on
increasing user engagement and spending. The Target Group continues to introduce
several interactive gifts and features in 17LIVE that increase the interaction and the levelof engagement between users, live streamers and V-Livers. The higher the level ofengagement, the higher the ARPPU, and the shorter the time needed to achieve breakevenon user acquisition cost.
The following table sets out the Target Group’s average monthly Spend Rate and ARPPU
for the half-yearly periods from FY2020 up to 1H FY2023.
1H
FY20202H
FY20201H
FY2021

2H
FY2021

1H
FY20222H
FY2022

1H
FY2023

Target Group

8.8%

9.9%

16.5%

9.0%

10.7%

17.3%

16.1%

– Japan

8.2%

9.8%

17.6%

15.4%

19.9%

24.4%

24.5%

– Taiwan

7.8%

8.8%

13.3%

14.8%

15.4%

17.4%

17.6%

Target Group

289

354

366

349

302

285

302

– Japan

314

405

410

401

322

280

279

– Taiwan

345

326

340

306

335

364

459

Spend Rate

ARPPU (US$)

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LETTER TO SHAREHOLDERSThe Target Group’s dedicated prestige customer service team managing top spenderaccounts and providing personalised services led to an increase in ARPPU in Taiwan after
the ease of COVID-19 pandemic. For Japan, the ARPPU in 2023 tapered down andreturned to pre-COVID-19 pandemic levels as users gradually returned to more offline
entertainment and spent less time consuming digital content, including interactive live
streaming.
The following table sets out the Target Group’s average monthly Spend Rate and ARPPU
for FY2020, FY2021 and FY2022:
FY2020

FY2021

FY2022

Target Group

9.3%

12.8%

14.0%

– Japan

9.0%

16.5%

22.1%

– Taiwan

8.3%

14.0%

16.4%

Target Group

322

358

294

– Japan

360

406

301

– Taiwan

335

323

350

Spend Rate

ARPPU (US$)

Army
Users can join the fan group of their favourite live streamers and V-Livers and become partof their core community by enrolling in the live streamers’ and V-Livers’ subscription plan,i.e. the users pay a subscription fee on a monthly basis and become an “army subscriber”
of the relevant live streamer and V-Liver. In Taiwan, users can enrol in the live streamers’
and V-Livers’ subscription plan by paying the subscription fee directly or by spending virtual
points. In other markets, users can only enrol in the live streamers’ and V-Livers’
subscription plan by paying the subscription fee directly. A user who is an army subscriber
will enjoy special privileges, which will vary depending on the value of the subscription plan.
These special privileges include a tiered army exclusive badge (based on the different
subscription plans), gifts, a special notice when entering live stream, and exclusive fangroup streaming. The army subscriber with the highest rank is awarded the title of the “chief
general”. Live streamers and V-Livers are rewarded with virtual points on a daily basis
based on their army subscribers’ subscription plans, the composition of which is accessible
to the live streamers and V-livers. The Target Group recognises revenue generated fromsubscription plans on a daily basis.
In-app Games
In-app games were first launched on 17LIVE in Taiwan in May 2022 which included two
main genres of in-app games, being (i) half-screen casual games that users can play while
simultaneously watching content on its platforms, such as “Fruit Farm” and “Onmyoji”, and(ii) half-screen interactive games that users can play together with live streamers. These
in-app games were gradually rolled out to different markets since the launch.

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Most in-app games are developed in-house and the Target Group owns the copyright ofsuch in-app games. Some in-app games are developed by third-party developers and suchthird-party developers own the copyrights and/or trademarks of the respective in-app
games. The Target Group has a tiered profit-sharing arrangement with the third-party
developers.
One popular interactive game on 17LIVE is “Go-Kart”, an in-house developed racing gamewhere users can use their virtual points to purchase virtual game equipment and tools forlive streamers to win the race. The Target Group believes that its in-app games offerings
enhance user retention rate by keeping users engaged during live streaming downtime, andby providing another opportunity for interaction between live streamers and users.
The following screenshots demonstrate a variety of in-app games offered on 17LIVE:“Go-Kart”“Fruit Farm”“Onmyoji”

Underpinned by the Target Group’s in-house game development capabilities, in-app casual
games serve as a new high-margin revenue stream as it does not involve revenue sharing
with live streamers.
The following table sets out the Target Group’s average monthly Game Penetration Rate forthe half-yearly periods since its introduction in 1H FY2022 up to 1H FY2023:
1H FY2022

2H FY2022

1H FY2023

Target Group

3.2%

21.4%

25.5%

– Japan

0.0%

20.7%

25.1%

– Taiwan

15.5%

28.3%

24.4%

Average monthly Game Penetration Rate

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LETTER TO SHAREHOLDERS
The following table sets out the Target Group’s average monthly Game Penetration Rate for
FY2022:
FY2022Average monthly Game Penetration Rate
Target Group16.8%– Japan

15.5%– Taiwan

25.1%

Online Competitions and Offline Events
Through online competitions and offline events, the Target Group gamifies the gift giving
process to create more fun and excitement and taps into the competitive reward psyche of
its live streamers and users, while providing both groups with an immersive and real-lifeface-to-face entertainment experience.
The diagram below illustrates the synergy between online and offline experience for live
streamers and users:

Immersive online and offline experiences
ONLINE

Event banner

OFFLINE

Event leaderboard

Offline finales

Online event marketing & online competitions

Multiple offline events to engage users

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LETTER TO SHAREHOLDERS
The diagram below illustrates the interaction between and the stages of the online
competitions and offline events:
Event planning

Online event marketing and online competition
Event timeline

Event flyer

Event banner

Event leaderboard

OnlineRules setting

Offline finale
Venue design

Real-time offline performance

PrizesOfflineAnchoring

Online Competitions. The Target Group designs a variety of online competitions withdifferent themes which live streamers can choose to participate in. Live streamers are
incentivised to engage with users and encourage spending in order for the live streamers
to progress in the online competitions. The Target Group’s online competitions give fans anopportunity to show their support to their favourite live streamers and provide the winning
live streamers with a variety of rewards, including the opportunities to participate in offline
concerts, ceremonies or runway shows, appear in in-house produced programmes andbrand collaborations, or promote their personal brands on billboards and magazines.
The Target Group regularly hosts the “17 Music Wave” competitions in Japan, where live
streamers participate in a series of online competitions generally lasting for two weeks, fora place to perform in the offline concert. The first “17 Music Wave” concert was held inTokyo in January 2020, which was attended by ten groups of performers and more than
300 participants. Since then, the Target Group has successfully held a number of “17 MusicWave” concerts, making it one of the most attended and well regarded competitions in themusic genre on 17LIVE. In collaboration with Japanese fashion entertainment companies
such as Kansai Collection, the Target Group also regularly hosts in-app auditions foropportunities to walk the runway in one of Kansai Collection’s shows.
Offline Events. The Target Group regularly organises different types of offline events. For
example, newbie exclusive events are held on a regular basis to help new live streamersbuild a stronger community and bond with users, and adapt to the gifting culture. Luxury
offline events are usually held at high end venues to provide live streamers and users witha premium face-to-face engagement experience with certain indulgences. The Target
Group’s events team has substantial experience in developing localised events. The events

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team is tasked with creating and implementing new ideas that are unique and tailor-madeto each event with the goal of raising the profile of the 17LIVE brand and the popularity of
its live streamers.
The following screenshots showcase a number of competitions organised by the Target
Group:“17 Music Wave”“Live Streamers from 17LIVE Appearing on
Kansai Collection Fashion Show”

In August 2020, the Target Group held a “Summer Festival” in Taiwan, creating an authentic
Japanese festival experience featuring Japanese street food, game zone, and matsuri
performance and a “Let’s Bando” event, where live streamers cooked special dishes forparticipating top spenders.

“2020 Summer Festival”

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LETTER TO SHAREHOLDERS
In June 2022, the Target Group held its annual “Shining Star” event in Japan with 70 top live
streamers on 17LIVE voted by fans, as well as 20 top spenders, offering the live streamers
more exposure through performances, runway show and live streaming gifting competition,
providing the top spenders with a tangible bonding experience that further strengthened
their connection with the live streamers.

“2022 Shining Star”
In December 2022, the Target Group held a “Christmas Party” in Taiwan with 155 live
streamers and 100 top spenders. Live streamers live streamed the entire party while
participating in interactive games and performing on stage. The competitive atmosphereamong live streamers and their fans at the event further facilitated their interactions.
Individual prizes and team prizes such as virtual points and luxury items were awarded tothe top live streamers.

“2022 Christmas Party”

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LETTER TO SHAREHOLDERS
In June 2023, the Target Group launched a two-day “17LIVER Expo”, a stage event in
Taiwan, featuring offline performances of live streamers, V-Livers and pop stars from Japanand Taiwan. The 17LIVER Expo also featured a weekend market where localised physicalmerchandise were sold, attracting approximately 37,500 participants in total.

“2023 17LIVER Expo”
Localisation across markets
Given the Target Group’s global operations, the Target Group embraces the fact that eachgeography exhibits unique cultural traits with diverse cultural backgrounds andpreferences. The Target Group celebrates these differences and strives to localise its apps
and operations across its markets.
For example, the Target Group’s localised content in Japan caters to the uniquesociocultural characteristics and preferences of the Japanese population. According to the
IMR Consultant, the unique characteristic of the young Japanese population is theprevalence of Hikikomori (also known as social withdrawal) and Otaku (who are individuals
that display strong interests and extensive knowledge of subjects such as anime, manga,
video games and related fandoms). Japanese with such characteristics may often find it
challenging to engage in face-to-face interactions. As such, 17LIVE has specially designed
emojis and virtual gifts that cater to the liking of these demographics and continues to serve
as a safe and comforting environment for them to seek social interactions.
Localised Apps and Content Discovery
17LIVE offers substantially the same functions in Japan and Taiwan, with each localised
version of the app available in the dominant language of the region in which it operates,
offering tailored functionalities and content in each market.
The Target Group conducts market surveys regularly to develop new genres of content fordifferent countries and regions. The Target Group recruits live streamers as pilot testers for
new content genres, while agents monitor interactions within the live streaming rooms andanalyse the performance data. Adding onto the Target Group’s content localisation, theTarget Group also runs monthly costume theme online events where live streamers can
dress up in their local costumes. The Target Group also organises uniquely themed
activities regularly to celebrate traditional festivals in different regions. For example, theTarget Group has previously rolled out special animation designs based on Taiwaneseclassic romantic novels in Taiwan.

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The following screenshots demonstrate the localised gifts, live streamers and content
discovery, and online competitions and offline events on 17LIVE:

Japan

Japan

TaiwanTaiwanLocalised Gifts
In Japan, one of the localised virtual gifts is “takoyaki”, a traditional Japanese snack filledwith octopus. In Taiwan, one of the localised virtual gifts is a “Qixi” (七夕) themed gift, Qixi
(also known as Chinese Valentine’s Day) is a Chinese festival celebrating a Chinese
mythology. In Singapore, one of the localised virtual gifts is “Merlion”, a mythical creature
with a lion’s head and the body of a fish, and is a famous Singapore landmark.

Japan

Taiwan118

U.S./Southeast Asia
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LETTER TO SHAREHOLDERS
Localised Competitions and Events
The Target Group’s online competitions and offline events are of different themes indifferent regions based on local culture. The following screenshots showcase a number ofcompetitions and events featuring local cultural themes. Please refer to Section 14.3 titled“Information on the Target Company – Business Overview – The Target Group’s BusinessLines – Live Streaming – Online Competitions and Offline Events” of this Circular for further
details.

Japan Sengoku-themedcompetition( 戰國時代 – 花慶次)

Taiwan Chinese New
Year-themed cooking
competition (尾牙辦桌)

U.S. and Southeast Asia
Backyard Barbeque

Localised Operations
The Target Group’s data-driven bottom-up feedback loop consists of both centralised
management and localised operations. A data-driven feedback loop ensures corporate
strategies are aligned and able to meet the overall goals while the bottom-up feature refers
to the local operation team collaborating and providing feedback on its day-to-day
operations. Although the Target Group centralises its strategic management and technology
R&D, it grants a high degree of autonomy to local live streamer management teams andoperations, permitting local live streamer management teams to have a high amount of
discretion in curating localised content offerings and determining suitable monetisation
strategies.
With in-depth local knowledge and first-hand intelligence on market trends, theseon-the-ground teams are well situated to make business judgements and timely decisions.
The Target Group has invested significant resources in building up its local teams in eachof its primary markets. Aided by its big data analytical capabilities, these local teams haveeffectively adapted the Target Group’s product offerings to different cultures in order toscale its business in Japan, Taiwan and other countries.

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Premium Content
The Target Group leverages its strategic partnerships and collaborations with local
celebrities, politicians and athletes to produce professional content which is exclusively
offered by 17LIVE. In Taiwan, the Target Group invited politicians from different politicalparties and athletes to live stream on 17LIVE, including the Taiwan president, Tsai Ing-Wen(蔡英文), the former mayor of Taipei, Ko Wen-Je (柯文哲) and the former NBA star, Jeremy
Lin. In Japan, the Target Group further expanded its V-Liver content, which gained
significant popularity and traction among its users. Please refer to Section 14.3 titled“Information on the Target Company – Business Overview – The Target Group’s BusinessLines – V-Liver” of this Circular for further details.
The Target Group has also developed in-house shows featuring live streamers who won
online competitions, such as “17 Unbox (17瘋開箱)”, a variety show, “17LIVE Taiwan
6th Anniversary Event” and “17 Street Music Festival (17街頭音樂節)”. These shows weremainly streamed through the 17LIVE mobile application and reproduced in video format anddistributed through third-party social media platforms for marketing purposes. The Target
Group retains the copyrights of content distributed through the third-party social media
platforms.
The following screenshots demonstrate the diversity of content on 17LIVE:“17 Unbox (17瘋開箱)”“17LIVE Taiwan 6th
Anniversary Event”“17 Street Music Festival(17 街頭音樂節)”Content Management and Monitoring
The Target Group has established strict corporate policies for content management. Livestreamers must register an account with the Target Group’s platforms in order to stream. As
all live streamers are required to accept the Target Group’s terms of use when they register
for an account, they are required to ensure that all live streaming on the Target Group’s
platforms must abide by the Target Group’s content policy and comply with applicable laws
and regulations. Likewise, users must register an account in order to interact with the live
streamers by sending on-screen instant messages and giving virtual gifts. Users are notrequired to register an account in order to view live streaming content on the 17LIVE
website, but they must register an account to view live streaming content on 17LIVE mobile
application. The Target Group also requires registrants to accept its terms of use, which are
updated from time to time in accordance with applicable laws and regulations.

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LETTER TO SHAREHOLDERSThe Target Group’s content monitoring framework is comprised of three prongs:(i) automated screening, (ii) human screening and (iii) penalties. To the best knowledge of
the Target Group, there has been no material breach of the Target Group’s content
monitoring framework since the establishment of SkyEye, the content monitoring team of
the Target Group. The Target Group’s three-pronged content monitoring framework is in linewith industry practices to ensure compliance with the laws and regulations in thejurisdictions it operates in.
Automated Screening
The Target Group’s automated screening mechanism consists of a two-level automatic
filtering (redundancy screening and in-depth screening). The Target Group’s content
distribution network, or CDN, has automated filters that screen nudity, violence and otherexplicit or inappropriate content every five seconds. A proprietary software consisting of AI
models developed in-house by the Target Group aids SkyEye, the content monitoring teamof the Target Group, to monitor and screen graphics and user generated content against a
spam list, a list of keywords and behaviours that are likely to be indicative of inappropriate
content or activities, every few seconds. The software is tailored to monitor the contents
and materials of each market according to its cultural norms and legal restrictions. Content
that violates the Target Group’s policy or contains offensive materials is also filtered.
Human Screening
SkyEye, the dedicated multi-lingual content monitoring team of the Target Group, reviews
and handles content on its platforms across different regions. The team comprises
34 employees and is located in Taiwan. The team, aided by its proprietary software and AI
models, monitors live streams 24 hours a day, seven days a week to ensure that theplatforms provide a clean and friendly environment without inappropriate content or
offensive materials. The team also randomly tunes in to various live streams to monitor its
content. The team also closely monitors live streamers, with more attention on new joiners,
and promptly takes action on live streamers who engage in inappropriate use of the Target
Group’s platforms. By leveraging these technologies, the Target Group is able to detect andremove offensive materials quickly.
Penalties
The Target Group takes immediate enforcement actions to maintain the integrity of thecontent on its platforms, depending on the severity of the violation. Such actions range from“hiding” the live stream such that new users cannot enter the live stream, ending the live
stream and deleting the content, to suspending the violating account. Any live streamer or
V-Liver who violates the content policies of the Target Group will be temporarily suspended
from streaming. Those who violate the content policy three times or more will be banned
from 17LIVE. The associated social media accounts and mobile devices of banned users
are also tracked to prevent them from registering new accounts with 17LIVE.
Customer Service
The Target Group had a dedicated team of 63 customer facing service personnel as of
30 June 2023. Through an in-app online communication channel, the Target Group’s
customer service team helps users with issues they encounter on the mobile platforms,
gathers feedback on how to improve the Target Group’s services and receives customer
complaints and suggestions.
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LETTER TO SHAREHOLDERS
Within its customer service team, the Target Group has a dedicated prestige customer
service team to manage top spender accounts and provide personalised services. Suchservices include on-demand communication to resolve problems, special perks and accessto customised digital products and merchandise, and access to major offline events
organised by the Target Group to meet with their favourite live streamers. Customised
virtual gifts are also designed for top spenders who reach a certain level of spending. This
team works closely with other divisions to ensure that top spenders are continuously
engaged with the live streamers whom they support. The comments and feedback fromthese top spenders are carefully considered and implemented to the extent practicable.
V-Liver
In 2018, the Target Group launched V-Liver content as a genre on 17LIVE, combining virtualand real interactions to create an immersive, real-time experience with virtual charactersand to foster a thriving community. V-Livers are computer-generated characters designed
to resemble real people. 17LIVE is the first V-Liver agency with its own live streaming
platform poised for strong growth. This feature enables users to have real-time interactions
with virtual characters. There are human actors behind the V-Livers, whose movements,
sounds and expressions are simultaneously reflected on the V-Livers by using motion
capture technology or software. There is no direct association between the image andidentity of the V-Livers and those of the human actors.
As of the Latest Practicable Date, the Target Group has acquired more than 80 V-Liver IPs,of which over 60 V-Livers have started live streaming. The Target Group has licensing
arrangements with art studios such as HellArts to cultivate V-Liver proprietary IPs, further
enhancing the V-Liver offerings to capture users with different interests. These proprietary
IPs of the V-Livers under the licensing arrangement with HellArts belong to the Target
Group. In July 2023, the Target Group created its first five V-Liver proprietary IPs under thename BUSHILIVE.

“BUSHILIVE”
The Target Group has used the Open Broadcaster Software system for its V-Liver content
since its launch in 2018. In April 2023, the Target Group integrated the Live2D functions into
the broadcasting functionality, which allows anyone to use their smartphones to upload anavatar and conduct virtual streaming. With the Live2D functions, live streamers do not needto purchase additional equipment in order to virtual stream, significantly lowering thebarriers to becoming a V-Liver. The Live2D software has been licenced by a third party
provider for the Target Group’s broadcasting purposes. Since the integration of the Live2D
functions, the Target Group’s organic traffic of V-Liver MAS has grown significantly. In
August 2023, the Target Group further enhanced its broadcasting functionalities by122

LETTER TO SHAREHOLDERS
integrating VRM3D and hand gesture recognition functions in order to create an immersive
experience for users with V-Livers.
The Target Group collaborates with top voice actor schools and agencies to provide training
for V-Liver voice actors and live streamers who wish to become a V-Liver voice actor, which
increases the overall quality of the live streaming by V-Livers.
Likewise, the Target Group also organises various online competitions and offline events for
V-Livers. In 2018, V-Livers competed with live streamers to win the chance to perform at theTarget Group’s anniversary party in Japan. In September 2019, the Target Group held a live
streaming festival in Tokyo to celebrate its second anniversary in Japan and invited Kizuna
Ai, a leading virtual YouTuber in Japan to attend and perform at the festival, along withsome of the Target Group’s V-Livers and live streamers of different genres. In June 2023,
the Target Group organised an offline V-Liver performance in Ikebukuro, Tokyo. Out of the
200 live streamers competing online for a performance opportunity, five live streamers andfive V-Livers were shortlisted to perform on stage together during this offline performance.
This event recorded a gross revenue of approximately US$181,000 and attracted
approximately 3,000 fans to participate and support their favourite live streamers andV-Livers. In this way, the Target Group’s online events enable real-life connections between
V-Livers, live streamers as well as users with its offline events further increasing
engagement of these parties.
The following table sets out the Target Group’s average monthly V-Liver viewer, averagemonthly V-Liver Spend Rate and average V-Liver MAS for the half-yearly periods fromFY2022, when the V-Liver segment became a focus of the Target Group’s business growthplans, up to 1H FY2023:
1H FY2022

2H FY2022

1H FY2023

V-Liver Viewer (’000)

40

31

61

V-Liver Spend Rate

31.1%

33.9%

30.0%

V-Liver MAS (’000)

0.4

0.3

1.3

The V-Liver MAS grew significantly from 2H FY2022 to 1H FY2023 immediately after the
integration of Live2D functions in April 2023. Live2D functions allowed users to use theirsmartphones to upload an avatar and conduct virtual streaming without any additional
hardware or software, thereby significantly lowering the barriers to becoming a V-Liver,resulting in an increase in V-Liver MAS.
The following table sets out the Target’s Group average monthly V-Liver viewer, averagemonthly V-Liver Spend Rate and average V-Liver MAS for FY2022:

FY2022

123

V-Liver
Viewer (’000)

V-Liver
Spend Rate

V-Liver
MAS (’000)

36

32.5%

0.3

LETTER TO SHAREHOLDERS
Case Studies
Aone Hako
Aone Hako began to stream as a live streamer in the games genre in September 2019. In
2022, in order to further expand her fan base, she switched to being a V-Liver by hiring acharacter design studio to design her own V-Liver model. The Target Group provided
training and tutorials to Aone Hako and increased her in-app exposure. Aone Hako is aninspirational character and actively works as a “2.5-dimensional live streamer” as sheshares photos from her real life on social media. She has a large follower base and camefirst in the V-Liver category at the 5th Super Livestreaming Festival in 2022, an anniversary
event of 17LIVE. She also won the first Kanban event and earned the opportunity to appear
on a billboard at a major intersection in Shibuya.

Murayuki
Murayuki is a V-Liver who started live streaming in November 2018 as a Nekomata(mythical two-tailed cat) character. The Target Group supported Murayuki by arranging
collaborative shows of her with famous V-Livers from other agencies and increasing theexposure of her content creations. She achieved top rankings within a month and had
approximately 170,000 followers as of 30 June 2023. Murayuki is a representative rolemodel and driving force of the V-Liver streamer community due to her engaging voice,character, storyline, speaking skills, and well-planned content. She was an individual
V-Liver without agency support, and expanded her recognition and influence throughactively collaborating with other V-Livers and participating in fan engagement events. She
has received multiple awards and formed a V-Box group called “MUIMAL” with other
V-Livers. She is now an individual V-Liver directly contracted with the Target Group.

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LETTER TO SHAREHOLDERS

Live Commerce
The Target Group operates its live commerce business through (i) HandsUp and OrderPally,a B2B SaaS platform and (ii) 17Shop, a marketplace. Contracted Streamers are invited topromote products from leading brands in their live streams, creating an engaging shopping
experience for users, this is further facilitated and supported by the Target Group’s
knowledge and experience in organising events.
Since 2020, the Target Group operates its live commerce business through HandsUp in
Japan, a platform that allows merchants to sell their products through live streaming, andOrderPally in Taiwan, a B2B live commerce matching and order management SaaS
platform connecting merchants and users, to leverage the capabilities and the community
fostered through the live streaming business and build strong connections between brands
and users. As of 30 June 2023, the Target Group served 918 merchants through its
platforms. Approximately 20% to 30% of the Target Group’s total live commerce revenue asof 30 June 2023 comprises written revenue sharing arrangements in respect of the products
sold through HandsUp and OrderPally, which contribute less than 1% of the Target Group’s
total revenue as of 30 June 2023.
In October 2022, the HandsUp platform helped Hyundai, a Korean auto-mobile
manufacturer, sell three cars in a one-hour live stream. This was a breakthrough in the livecommerce industry in Japan, as these were the first cars ever sold through live streamingin Japan.
The Target Group introduced 17Shop to 17LIVE in July 2023, allowing the Target Group to
operate its live commerce business as a marketplace. Both live streamers and V-Livers cansell their branded goods on 17Shop, providing synergy to both the live commerce andV-Liver businesses. This is supported by a dedicated merchandise development team, whomanages the manufacture, outsourcing and development of V-Liver branded goods.
Wave
In 2019, the Target Group launched Wave, an audio-centric live streaming and social
platform in Taiwan, to expand into other live streaming formats. Wave provides a platform
for people who wish to showcase their talent, including singing and story-telling, without
revealing their faces. In 2022, the Target Group further launched Wave in Japan.
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LETTER TO SHAREHOLDERS
14.4 Marketing
To promote the Target Group’s platforms and the 17LIVE brand awareness, the Target
Group employs a variety of marketing tools, including advertising on social networking
media, search engines and web portals, cooperating with app distributors, as well asorganising offline events. The Target Group also employs performance-based marketing,which helps to identify paying users by monitoring and analysing the online behaviours ofa large number of internet users in order to develop more targeted and effective promotional
materials. However, the most efficient form of marketing for its platforms is still throughword-of-mouth referrals and repeat user visits, which are ultimately driven by the delivery
of a superior user experience on the Target Group’s platforms. The Target Group hastailor-made marketing strategies for each market to achieve the desired outcome.
On one hand, in Japan and Taiwan, the Target Group has a set of marketing strategies toenhance its brand image in order to defend its market leading position. This includes
traditional outdoor media such as billboards, and live streamers who win the Target Group’s
online competitions are given priority with respect to obtaining advertising spots, includingin the busy Tokyo Shibuya, Osaka and Fukuoka train stations. The Target Group also
partners and collaborates with major players in the media, entertainment and sports
industries to spread brand awareness. In July 2022, the Target Group collaborated with
Cosmopolitan to host a summer party in Taiwan, which featured a number of popular live
streamers on 17LIVE. In October 2022, the Target Group started to sponsor professional
basketball team, Kaohsiung Steelers, and had its name incorporated into the team’s official
name.
On the other hand, for the other regions, 17LIVE utilises marketing tactics to increase
market share by attracting quality users and live streamers. This includes online marketingthrough popular social media platforms and referral campaigns.
14.5 Major Customers
The Target Group’s customer base comprises of users of its live streaming platforms andmerchants who subscribe to sell their products through the Target Group’s live commerce
platforms.
The top five major customers of the Target Group comprise users of its live streaming
platform. Their respective revenue contributions to the Target Group during FY2020 toFY2022 were computed based on the number of virtual points spent by them on 17LIVE andthe total amount of the Target Group’s net revenue. The top five major customers of theTarget Group are individuals and none of them have any relationship with the Target Group,
its directors, CEO, or Controlling Shareholders, and their respective Associates. There are
no receivables outstanding from these top five major customers.
Merchants who subscribe to sell their products through the Target Group’s live commerce
platforms contribute less than 1% of the Target Group’s revenue.
No single customer contributed more than 5.0% of the Target Group’s revenue during the
Period Under Review.

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14.6 Major Suppliers
The Target Group’s suppliers include vendors for its mobile application channels, talentagencies, cloud service providers, server and bandwidth providers, third party payment
channels, which are mainly financial institutions in Japan and Taiwan with a small portionof financial institutions in Hong Kong and U.S., and live streamers. While live streamers
account for the majority of the cost of revenue, payment to each live steamer is not material.
The following table sets forth the Target Group’s major suppliers accounting for 5.0% ormore of the Target Group’s total cost of revenue during the Period Under Review:
Name of Major
Supplier

Products supplied/
Services provided

FY2020

FY2021

FY2022

1H
FY2023

Percentage of total cost ofrevenue (%)
Apple Inc.

Channel Fee

10.4

8.8

8.9

7.4

Google LLC

Channel Fee

7.2

5.1

4.7

3.6

Save as disclosed above, there are no other suppliers who accounted for 5.0% or more of
the Target Group’s purchases during the Period Under Review.
Save as disclosed below, as of the Latest Practicable Date and to the best of theirknowledge, none of the Directors, Executive Officers, Substantial Shareholders or their
Associates has any interest, direct or indirect, in any of the major suppliers of the Target
Group and/or are involved in the management of any of the major suppliers of the Target
Group.
Venezio’s holding company, Temasek, is a global investment company headquartered in
Singapore. Its portfolio covers a broad spectrum of industries: transportation andindustrials; financial services; telecommunications, media and technology; consumer andreal estate; and life science and agri-food. Temasek may, from time to time, makeinvestments in one or more portfolio companies which may have interests, whether direct
or indirect, in the major suppliers of the Target Group. However, as a matter oflong-standing governance policy, Temasek does not direct the business decisions oroperations of its portfolio companies, which are guided and managed by their respective
boards of directors and management teams, independently of Temasek. Temasek does notdirect, and is not involved in, the business, commercial or operational decisions of theTarget Group and the Company.
14.7 Seasonality
Discretionary consumer spending in Taiwan generally decreases during the tax season in
May and June, when Taiwan individual income tax is due and payable by Taiwan taxpayers
in one lump sum in May each year. The Target Group has observed a general downward
trend for discretionary consumer spending in Taiwan (including on its platforms) during such
period, which it believes is attributable to consumers having to make provision for tax
payments. In addition, live streamers tend to go on vacation during holiday season,
particularly in January, which leads to a lower number of streaming hours. Save for theabove, the Target Group does not experience any material seasonality from its customers.

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LETTER TO SHAREHOLDERS
14.8 Credit Policy and Credit Management
Credit Terms Offered to the Target Company’s Customers
Due to the nature of the business of the Target Group, the majority of the Target Company’s
customers are users who purchase virtual points on its platforms. As such payments are
made through credit or debit cards and electronic payment through third party payment
service providers, the Target Group does not give any credit terms to its customers2. The
Target Group gives a credit term of 20 to 60 days to third party payment service providers
for their payment to the Target Group of the proceeds from sale of the Target Group’s virtual
points, and to merchants for their payment of service fees for using the Target Group’s livecommerce platforms, depending on the terms and conditions entered with the respective
parties.
The following table sets forth the Target Group’s average trade receivables’ turnover days
during the Period Under Review:

Average trade receivables’
turnover days

FY2020

FY2021

FY2022

1H FY2023

20.5

23.4

28.0

25.3

The Target Group has not previously encountered any issues in relation to the collection of
its trade receivables. The expected credit losses for the Period Under Review were
attributed to ageing of trade receivables from spenders.
Credit Terms Granted by the Target Company’s Suppliers
On average, the Target Group is given a credit term of up to 60 days and payment is madeto its suppliers by bank transfer.
The Target Group’s average trade payables’ turnover days during the Period Under Review
are as follows:

Average trade payables’
turnover days

2

FY2020

FY2021

FY2022

1H FY2023

48.6

53.1

63.0

63.7

The only exception is the granting of credit term to a customer (who was not among the Target Group’s top five major
customers during FY2020 to FY2022) with consistent spending on 17LIVE for more than five years, where credit term
was granted as the only exception to the particular customer, after review by the legal, financial and internal control
team and the chief executive officer of 17LIVE Taiwan. The customer which was granted the credit term has no
relation with the Target Group, its directors, CEO, or controlling shareholders, and their respective associates. While
the Target Group does not anticipate any future grant of credit term to its customers, the same review process will
apply to any future application of credit term. The Target Group does not, as a matter of general practice, extend credit
terms to other customers meeting the reasons above. As of the Latest Practicable Date, the amount of credit extended
to the customer was in the aggregate of TWD14.7 million.

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LETTER TO SHAREHOLDERS
There has been no change in the Target Group’s credit terms during the Period Under
Review. The increasing trend in the trade receivables’ and trade payables’ turnover days
during the Period Under Review is a result of the fluctuation in the Target Group’s revenue(in the case of trade receivables) and cost of revenue (in the case of trade payables), as
well as the fluctuation in average year-end receivables (in the case of trade receivables)
and average year-end payables (in the case of trade payables), as the trade receivables’
and trade payables’ turnover days are calculated based on a formula by reference to thesefactors.
14.9 Material Properties and Fixed Assets
As of the Latest Practicable Date, the Target Group does not own any properties.
The headquarters of the Target Group is in Japan and its principal places of business arelocated in Tokyo, Japan and Taipei, Taiwan. The Target Group has six offices in Japan,
Taiwan, Hong Kong and India, and one of the offices in Taiwan also includes a recording
studio. All of the Target Group’s office premises are leased.
As of the Latest Practicable Date, the Target Group’s material properties comprise thefollowing:
Total landsize (sq m)

Term oflease

2-12-28,
Kita-Aoyama,
Minato City,
Tokyo,
Japan(日本東京都港區北青山
2-12-28)759.02

1 September
2022 –
31 March
2025

Office
US$28,992.40(equivalent tolocal currency
JPY4,339,440)
plus US$7,669.90(equivalent tolocal currency
JPY1,148,000)
for common area
maintenancel/F, No. 221
and 223,
Section 1,
Tiding Blvd,
Neihu District,Taipei City,
Taiwan(台灣台北市內
湖區堤頂大道一段221及223號l樓) (“Neihu
Lease”)

650.3

10 August2022 –
31 January2026

US$6,113.80(equivalent tolocal currency
NT$196,730) for
rent, plus
US$614.40(equivalent tolocal currency
NT$19,770) for
management fees

LesseeProperty

17LIVEJapan

17LIVE
Taiwan129

Monthly rental

Use ofproperty

LessorMarubeni
Corporation(丸紅株式會社)

OfficeYaochengandIndustrial Co.,
Recording Ltd.
Studio(曜丞實業股份有限公司)

LETTER TO SHAREHOLDERS
Total landsize (sq m)

Term oflease

Flats A1-2,
19/F, Hung
Sheng
International
Finance
Centre,No. 168,
Section 3,
Nanjing E Rd,
Zhongshan
District,
Taipei City,
Taiwan(台灣台北市中山區南京東路三段168號「宏盛國際金融中心」
19樓A1-2室)

1,554.5

1 February
2023 –
31 January
2026

Office
US$54,072.10(equivalent tolocal currency
NT$1,739,925 forthe first year
US$55,533.50(equivalent tolocal currency
NT$1,786,950)
for thesubsequent two
years

Hung Sheng
Construction
Co., Ltd(宏盛建設股份有限公司)

17LIVE
TaiwanFlat A4, 10/F,
Hung ShengInternational
Finance
Centre,No. 168,
Section 3,
Nanjing E Rd,
Zhongshan
District,
Taipei City,
Taiwan(台灣台北市中山區南京東路三段168號「宏盛國際金融中心」
10樓A4室)

313.3

1 May
2023 –
31 January2026

US$9,570.90(equivalent tolocal currency
NT$307,970) for
the first ninemonths
US$9,859.40(equivalent tolocal currency
NT$317,256) for
the subsequent
two years

OfficeHung Sheng
Construction
Co., Ltd(宏盛建設股份有限公司)

17LIVEHK

28/F, “909Cheung Sha
Wan Road”,
No. 909
Cheung Sha
Wan Road,
Cheung Sha
Wan, Kowloon,
Hong Kong(“Hong Kong
Lease”)

788.2

1 September
2021 –
31 August2024

Office
US$27,335.80(equivalent tolocal currency
HK$212,025) plus
US$6,833.90(equivalent tolocal currency
HK$53,006.25)
for management
andair-conditioning
charges

BlessedPinnacle
Investments
LimitedLesseeProperty

17LIVE
Taiwan130

Monthly rental

Use ofproperty

LessorLETTER TO SHAREHOLDERS
Total landsize (sq m)

Term oflease

Flat Roofat 28/F,“909 Cheung
Sha WanRoad”,
No. 909
Cheung Sha
Wan Road,
Cheung Sha
Wan, Kowloon,
Hong Kong (1)17.4

1 September
2021 –
31 August2024

Liontrek Office Number
04-106,
WeWork BlueOne Square,
246, Phase IV,
Udyog Vihar,
Gurugram, HR,
122016, India(“India
Lease”)

63.5

1 December US$4,395.00
2022 –(equivalent to
30 November local currency
2023
Indian Rupee
363,000)

LesseePropertyMonthly rental
US$16.10(equivalent tolocal currency
HK$125) plus
US$150.70(equivalent tolocal currency
HK$1,168.75)
management fee

Use ofproperty

LessorLeisureBlessedPinnacle
Investments
Limited

Office

WeWork India
Management
PrivateLimitedNote:(1) The lessee is granted the right to use the said premises by the lessor under a licensing arrangement pursuant
to the Hong Kong Lease.

Under the Neihu Lease, the lessor may terminate such lease by providing one month ofliquidation damages. Under the Hong Kong Lease, the lessor may terminate such lease byproviding six months’ notice in writing, if at any time during the term, the lessor decides tosell, redevelop, demolish, rebuild, refurbish or renovate the premises or the building. Under
the India Lease, the lessor may, at its sole discretion, terminate such lease at any time itsees fit to do so.
Any unilateral termination by the abovementioned lessors is unlikely to have a material
impact on the Target Group’s business or operations as the Target Group believes that theTarget Group is able to secure leases for alternative premises in such an event.
Save as disclosed above, none of the leases may be unilaterally terminated by therespective lessors. As of the Latest Practicable Date, the Proposed New Board is not awareof any existing breach of any obligations under the abovementioned lease agreements thatwould result in their termination by the lessor or non-renewal, if required, when they expire.
The Target Group does not have any production facility.
The Target Group has obtained the required material licences for the business operations
in respect of the properties listed in this section and there are currently no regulatory
requirements or environmental issues that may materially affect the Target Group’s
utilisation of the above properties.

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LETTER TO SHAREHOLDERS
14.10 Insurance
As of the Latest Practicable Date, the Target Group maintains insurance that covers
directors’ and officers’ liability, and incidents relating to fire accidents.
The Target Group is of the view that the insurance coverage from the above insurance
policies is in line with industry practice and adequate for its existing business andoperations and will review and procure the necessary additional insurance coverage as andwhen the need arises. However, significant disruption to the Target Group’s operations or
damage to its properties or assets, whether as a result of fire and/or other causes, may still
have a material adverse impact on its results of operations or financial condition. There is
no assurance that any claims made or decided against the Target Group will be covered byinsurance, or if covered, will not exceed the limits of the Target Group’s coverage. Pleaserefer to Section 16.1 titled “Risk Factors – Risks relating to the Business and Industry of theTarget Group – The Target Group’s insurance may not sufficiently cover, or may not coverat all, losses and liabilities that it may encounter” of this Circular for further details.
14.11 Permits, Approvals, Licences and Government Regulations
Although the Target Group is not required to obtain and therefore has not obtained any
permits or licences to operate its business, the live streaming and internet industries areheavily regulated, and certain registrations and notifications may be required to be madeunder certain regulations with respect to the current business of the Target Group as set out
in Appendix G titled “Government Regulations” of this Circular.
14.12 Research and Development
Technology
The Target Group believes that its ability to develop mobile applications and services
tailored to respond to the needs of its user base has been a key factor for the success of
its business. The Target Group invests significant resources into its R&D, focusing on
improving the multi-media functionalities of its platforms, extending product offerings,
improving user experience and providing synergistic services. The Target Group has spent
US$4.1 million, US$16.6 million, US$27.3 million, US$13.1 million and US$13.5 million on
R&D expenses for FY2020, FY2021, FY2022, 1H FY2022 and 1H FY2023, respectively.
The Target Group is focused on ensuring the delivery of high quality video and voice dataover the internet. For live voice- or video-enabled communications, any data packet loss
and jitter, or delay in transmission, is often immediately noticeable to users and the Target
Group devotes significant resources to maintaining and developing a creative combinationof multiple voice- and voice or video streaming quality assurance mechanisms to minimise
any data loss or jitter.
The Target Group had a dedicated R&D team of 289 engineers, computer scientists andtechnicians as of 30 June 2023. The Target Group has a R&D reward scheme in place toencourage its employees to contribute to its innovative R&D work regularly. The Target
Group has accumulated extensive experience in image processing, real-time voice andvideo streaming, high concurrent connections, load balancing, distributed systems, data
capture, data security and big data analysis during the process of developing its platforms.

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LETTER TO SHAREHOLDERS
As one of the market leaders in the live streaming industry, the Target Group commits toleading the development of live streaming technology and generation of innovative ideas.
The Target Group’s R&D initiatives are focused on the development and introduction of new
tools and processes to its platforms to empower human connections through live
technology. Such initiatives have the explicit aim of making live technology accessible to all
people and to amplifying users’ ability to form authentic human connections with one
another. The Target Group’s strategic development emphasises its ability to rapidly
innovate to cater to the ever-changing needs of its users and it also views the feedback
from its users as a primary source of innovation. The Target Group uses a third party
software to collect user profiles, user location, user behaviours and other personal datafrom its users in order to better understand its users and their needs and to support theTarget Group’s big data analysis for more targeted services such as interest- or locationbased user groups and mobile marketing services. Pursuant to the licensing agreement
between the Target Group and the third party software provider, the Target Group owns andmaintains the intellectual property rights of the user profiles, user location, user behaviours
and other personal data collected from its user.
The Target Group’s R&D strategies include two core categories, namely interaction
technology and fundamental technology. Under interaction technology, the R&D teamfocuses on, amongst others, the development of technologies to facilitate browsing, virtual
gifting, online competitions and offline events, in-app games, V-Liver streaming
environment and interaction. Under fundamental technology, the R&D team focuses on,amongst others, the development of technologies relating to the monitoring of content
violation and complaints, big data analysis for more targeted services and system support.
The Target Group maintains an integrated network which synchronises its S+ latency
technology, the services provided by its internet service providers, cloud service providers,and CDN operators. This integrated network enables the Target Group to efficiently andeffectively maintain a high quality and high speed live social entertainment platform.
Through this network, the Target Group is able to optimise the speed of CDN services byrouting certain traffic to another network to avoid traffic congestion so as to ensure its live
streaming quality is not affected, especially in an offline event where 200 to 300 live
streamers are streaming simultaneously in the same place at the same time. In addition, theTarget Group utilises third party software to monitor its system metrics, including theloading of virtual gifts, response time or latency between data sending and receiving,
central processing unit loading, queries per second, error rates and other key metrics.
The Target Group cooperates with third party providers for cloud storage and CDN
infrastructure. The Target Group orders cloud services from third party providers for data
storage, computing and management, and the providers maintain a virtual infrastructure tokeep its data available, accessible and safe. The Target Group relies on its S+ latency
technology and CDN operators to deliver internet content, including web objects (text,
graphics and script), apps (e-commerce and portals), live streaming media, on-demand
streaming media and social networks, to its users. The Target Group engages multiple CDN
operators to prevent disruption to its operations if any technical problems arise.

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LETTER TO SHAREHOLDERS
Data Analytics Capabilities
The Target Group’s highly engaged user base generates enormous amounts of data
through countless hours of live streaming and interaction. The Target Group’s data analytics
system analyses over 50 metrics relating to live streamers’ performance, including weekly
unique commenters, number of followers, hourly received points, weekly total duration,
weekly average duration per day, recent live stream and number of live stream days, as wellas user behaviours and preferences. The Target Group’s data analytics tools can recognise
objects and live streamer activities from videos, such as whether they are talking or singing,and identify topics being discussed in the audio. This assists the Target Group to analyse
the type of content and live streamer behaviours which drive user behaviours, and produce
real-time recommendation of suitable content to different users.
Data Protection and Privacy
To protect the users’ privacy, the Target Group has implemented extensive data security
measures, including the categorisation of data, anonymisation of personal data, restricted
access to databases and secured backup mechanism. The Target Group anonymises
personal data and only stores summarised metrics in its centralised database. The
anonymised information is subject to strict permission control access and only granted tocertain authorised accounts. To prevent data leakages, the Target Group prohibits anyone
from sharing any personal information outside the organisation.
14.13 Employees and Staff Training
The following table sets forth the geographical breakdown of full time employees as of
31 December 2020, 2021 and 2022 and 30 June 2022 and 2023:
As of 31 December

As of 30 June

Location

2020

2021

2022

2022

2023

Taiwan

438

518

542

501

541

Japan

182

239

226

238

204

Singapore

3

5

4

4

4

Hong Kong

24

28

20

19

20

U.S.

23

38

12

36

11

PRC

59

68

29

61

4

India

49

68

67

81

62

Dubai

8

0

0

0

0

Total

786

964

900

940

846

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LETTER TO SHAREHOLDERS
The following table sets forth the number of employees categorised by functions as of
31 December 2020, 2021 and 2022 and 30 June 2022 and 2023:
As of 31 December

As of 30 June

Function

2020

2021

2022

2022

2023

Sales and Marketing

363

413

333

304

339

Customer Service

64

76

77

89

63

General and
Administrative

128

136

153

213

153

IT

2

1

2

2

2

R&D

229

338

335

332

289

Total

786

964

900

940

846

There was generally no material change in the number of employees of the Target Groupas of 31 December 2020, 2021 and 2022 and 30 June 2022 and 2023, except that during
the financial years ended 31 December 2020 and 2021, the Target Group expanded its R&D
team in order to expedite its products development and upgrade in technologicalinfrastructure. There was a reduction in sales and marketing personnel during the financial
years ended 31 December 2021 and 2022 due to restructuring across different locations.
There was also a reduction in R&D personnel from 31 December 2022 to 30 June 2023, due
to the Target Group’s efforts to streamline and optimise the staffing structure while
maintaining operational efficiency.
As of 30 June 2023, the Target Group has 8 personnel in its headquarters’ finance function,and 21 personnel in Taiwan and other regions, who directly and indirectly report to the CFO.
The Target Group considers its finance function to be adequately staffed and appropriate forits operations. As and when the need arises, the Target Group’s finance function can also
be supplemented by other financial consultants, for example, tax and valuation specialists.
The Target Group’s finance function remains under the review of the Target Group’s auditor
at least on an annual basis in the course of the annual audit of the Target Group’s auditor.
As required by the laws and regulations in Japan, Taiwan, Hong Kong, Singapore, India, theU.S. and PRC, the Target Group participates in various employee social security plans,
including pension, labour insurance (including ordinary insurance and occupational
accident insurance) and national health insurance. The Target Group is required to makecontributions to such employee social security plans at specified percentages of thesalaries, bonuses and certain allowances of its employees, up to a maximum amountspecified by the local government from time to time. For instance, under the Labour
Standards Act and the Labour Pension Act of Taiwan, the Target Group is required tocontribute no less than 6.0% of an employee’s monthly salary into a specific account as partof such employee’s pension; under the Labour Insurance Law of Taiwan, the Target Groupshould withhold and pay for the social insurance premium for its employees aged between
15 and 65 years. In addition, under the National Health Insurance Law of Taiwan, the Target
Group is required to pay for a certain statutory percentage of its employees’ healthinsurance premium.

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LETTER TO SHAREHOLDERSThe Target Group typically enters into standard confidentiality and employment agreementswith its employees. These contracts include a standard non-compete covenant thatprohibits the employee from competing with the Target Group, directly or indirectly, during
his or her employment and for one year after the termination of his or her employment,
subject to laws in the applicable jurisdiction.
The Target Group provides allowances to its employees for their occupational training, gym
memberships, medical check-ups and reimbursement of their phone bills. The Target Group
believes that it maintains a good working relationship with its employees, and has notexperienced any material labour disputes. None of its employees are represented by labour
unions.
14.14 Intellectual Property
The Target Group seeks to protect its intellectual property rights through a combination of
trademark, copyright and trade secret protection laws in Taiwan, Japan and otherjurisdictions, as well as through confidentiality agreements and procedures with its
employees, partners and others. Please refer to Appendix L titled “Intellectual Property
Rights of the Target Group” of this Circular for further details.
Trademarks
As of the Latest Practicable Date, the Target Group has 160 registered trademarks inJapan, Taiwan and other countries or regions. Please refer to Appendix L titled “Intellectual
Property Rights of the Target Group” of this Circular for further details on trademarks
material to the Target Group’s business.
As of the Latest Practicable Date, the Target Group is in the process of applying for
15 trademarks in Japan, Taiwan and other countries or regions. The Target Group owns the
copyrights of all the content streamed on its platforms. The trademarks listed above are key
to the Target Group’s operations as it represents its brand name and platforms.
Domain Names
As of the Latest Practicable Date, the Target Group has 73 registered domain names,
including the following:1.

17app.co;2.

17.live;

3.

17live.com;

4.

wave.com.tw; and5.

handsup.tw.

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LETTER TO SHAREHOLDERS
Patents
As of the Latest Practicable Date, the Target Group owned 57 patents, 52 of which are in
Japan, such as the patents relating to “frame image of a group call”, “recommendation using
machine learning in live streaming”, “gifting during live streaming”, “rejoining during live
streaming after network disconnection”, “tipping gift for in-app games” and “S+ latency
technology”, which significantly improve user experience on the Target Group’s platforms.
The Target Group is applying for 162 patents in Japan, Taiwan and other countries orregions. Please refer to Appendix L titled “Intellectual Property Rights of the Target Group”
of this Circular for further details on patents material to the Target Group’s business.
Save as disclosed above, the Target Group does not own or use any other registeredtrademarks, internet domain names or intellectual property which are material to its
business. The Target Group’s business and profitability are also not materially dependent
on any other intellectual property such as patents, patent rights, licences and processes orother tangible assets. During the Period Under Review and up to the Latest PracticableDate, the Target Group did not have any dispute or other pending legal proceedings
concerning intellectual property rights.
14.15 Competition
The Target Group is subject to intense competition from providers of similar services as wellas potential new types of online entertainment services. The Target Group operates in
multiple markets, in particular, Japan and Taiwan. Please refer to Appendix F titled“Independent Market Research Report” of this Circular for further details on the Target
Group’s competitors.
The Target Group’s live streaming business mainly competes with two types of companies,
namely social media platforms with live streaming function and pure-play interactive live
streaming platforms.
While certain social media platforms offer live streaming function, their main business focus
is on long-form or short-form pre-recorded videos and their monetisation is mainly throughadvertising revenue underpinned by broad user base and high user traffic. However, theTarget Group focuses on deep and meaningful social interactions within a close-knit
community, this is enabled by high quality content, tech-enabled interactive features andfunctionalities within 17LIVE.
The Target Group differentiates itself from other pure-play interactive live streaming
platforms based on its integrated omnichannel user experience, online competitions andoffline events supported by its strong events team. Leveraging its leadership in Japan andTaiwan, the Target Group provides its live streamers with unique exposure opportunities
such as brand collaborations, runway shows, offline concerts and in-house produced
programmes.

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LETTER TO SHAREHOLDERSAs the Target Group expands its V-Liver business and introduces its V-Liver proprietary IPs,
the Target Group competes with other V-Liver agencies as well. The Target Group is the first
V-Liver agency with its own live streaming platform. Unlike the traditional agency model, theTarget Group adopts a hybrid approach supporting both its own V-Liver proprietary IPs andorganic V-Livers to stream and showcase their talent on 17LIVE.
Please refer to Appendix F titled “Independent Market Research Report” of this Circular for
further details on the Target Group’s competitors.
The Target Group believes that its ability to compete effectively depends upon manyfactors, including the size, composition and engagement of its user base, its ability to adjust
to rapid advancements in technology and consumer tastes, its ad targeting capabilities,
market acceptance of its mobile marketing services, its marketing and selling efforts, andthe strength and reputation of its brands. Please refer to Section 16.1 titled “Risk Factors– Risks relating to the Business and Industry of the Target Group – The Target Group
operates in an industry that is highly competitive. If it is unable to compete effectively, its
business, results of operations and prospects may be materially and adversely affected” ofthis Circular for further details.
14.16 Competitive Strengths
The Target Group operates the leading live streaming ecosystem in Japan and Taiwan. The
Target Group believes that the following competitive strengths contribute to its success anddifferentiate the Target Group from its competitors.
Leading Live Streaming Ecosystem in Japan and Taiwan
The Target Group operates 17LIVE, which is the top pure-play live streaming platform inJapan with a market share by revenue of 20.8% for 2022 and commands a significant
market share by revenue of 26.9% in Taiwan for 2022, according to the IMR Consultant. The
Target Group believes its success in these core markets is attributed to its early moveradvantage which allowed it to accumulate local know-how and gain market share in thesefast growing live social entertainment markets. Since the Target Group’s entry into Japan in2017 and Taiwan in 2015, these markets have contributed to the growth of the Target
Group’s business, generating US$251.9 million and US$86.8 million in operating revenue,
respectively, for FY2022. For Japan and Taiwan in 1H FY2023, 17LIVE’s average MAU wasapproximately 245,000 and 92,000 respectively, while the Average Daily View Duration per
DAU was 101 minutes and 82 minutes, on a monthly average basis respectively.
Additionally, according to the IMR Consultant, 17LIVE has the highest ARPPU among thepure-play live streaming platforms in both Japan and Taiwan in 2022. The ARPPU of 17LIVE
in Japan and Taiwan was approximately US$301 and US$350 in 2022 respectively.

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LETTER TO SHAREHOLDERSThe Target Group’s continued success stems from its ability to grow beyond a live
streaming platform. The Target Group has fostered a diverse live streaming ecosystem witha loyal and engaged user community and a deep talent pool of live streamers. To drive
continued engagement within this ecosystem, and leverage the core live streaming
business as a robust foundation for growth, the Target Group has introduced innovative
business initiatives such as V-Livers, in-app games and live commerce which are highly
synergistic with its core live streaming business and act as drivers for future sustainablegrowth of the Target Group’s business. The diagram below illustrates the self-reinforcing
ecosystem supported by the Target Group’s live social entertainment platform:

V-LiverLive streaming

~550k

~87k

Total MAUs1

Contracted Streamers2

In-appGames

Live
Commerce

Notes:(1) Average for 1H FY2023.
(2) As of 30 June 2023.

Loyal and Engaged Live Social Community Driven by Seamless Online and Offline
Experience
The Target Group believes that its ecosystem has accumulated a loyal user base due to its
strong brand image and enjoyable user experience. The Target Group connects users withlive streamers who generate content of interest through AI-powered personalised searchand recommendation. In addition to using content recommendation to drive user
engagement, the Target Group has adopted differentiated features such as AR-enabledemojis and virtual gifts, to create engaging experience for users and to drive interactions
and continuous engagement. As such, 17LIVE had a large user base with an average MAUof approximately 550,000 for 1H FY2023, where the average Quality MAU as % of MAU for
Japan and Taiwan was 14.4% and 12.9% respectively. Active interactions between users
and live streamers enhance users’ loyalty and engagement, which in turn motivate live
streamers to produce more appealing content to attract and retain more users.

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LETTER TO SHAREHOLDERS
The diagram below shows the synergy and interaction between users and live streamers on
17LIVE:
Competitive incentive

Strong loyalty and stickiness

Better content
quality

Increasing
interactivity

Loyal and highly
engaged users
Fun experienceestablishing emotional
attachment

High quality
live streamers
Talent cultivationand management

High quality
content

ShowcasetalentThe Target Group’s ecosystem is reinforced by its unique integration of online live
streaming and offline events. The Target Group hosts gamified online competitions among
live streamers, some of which conclude with an offline grand finale. The Target Group
provides event planning and marketing support for online competitions and provides
anchoring, venue design, real-time offline performance and prizes for the offline grandfinale. Users participate in the online competitions by supporting the live streamers throughvirtual gifting and sometimes the top spenders are invited to attend and witness the offline
finale and interact with their favourite live streamers. Online competitions create
anticipation and lead to a strong sense of participation and achievement among the users,
which boosts the hype and drives the users to continue supporting the live streamers until
the grand finale. The Target Group provides live streamers and users with an immersive
entertainment experience, which strengthens the connections between users and live
streamers and cultivates a unique community culture. For example, the Target Grouphosted 15 such offline events in Japan and four such offline events in Taiwan in 2022, whichwere underpinned by its in-house event coordination capabilities including design,planning, execution and technological expertise. In March 2023, the Target Group held the
grand finale of a series of Sengoku-themed gamified contests offline in Tokyo, which wasattended by more than 60 live streamers and the top ten spenders. This series attracted
approximately 20,000 spenders to participate and spend virtual points through the online
competitions and offline events. The live streamers live streamed the event on each of theirrespective channels to rally the support of their followers. The Target Group constantly
innovates on the themes of its online competitions and offline events to ensure that thecontent remains refreshing for users to stimulate ongoing interaction and engagement.

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LETTER TO SHAREHOLDERS(Sengoku themed event, March 2023)
The Target Group also offers unique offline exposure opportunities to live streamers suchas enabling the live streamers to perform during sports games or including them in brandcampaigns. Users are incentivised to support their favourite live streamers to win theunique exposure opportunities. For example, live streamers on 17LIVE are invited toperform during halftime at Kaohsiung 17LIVE Steelers’s games, the professional basketballteam sponsored by the Target Group. In 2020, the Target Group collaborated with Supau,
a well-known Taiwanese drinks brand, where the live streamers who won online
competitions had their faces featured on the bottle label of the Supau drinks. Purchasers of
the Supau drinks were also able to enter a lucky draw through 17LIVE, thereby widening thebrand awareness of the Target Group and enhancing the personal branding of the live
streamers. These opportunities expand and diversify the Target Group’s current content
offering and introduce its live streamers to a wider base of users. This ecosystem, which
integrates online and offline experiences, provides the Target Group with a uniquecompetitive advantage.
In addition, to improve user experience, the Target Group has dedicated customer service
teams to promptly respond to and address enquiries, feedback or complaints from users
received through instant messaging or emails. The Target Group also has a dedicatedprestige customer service team to provide personalised services to its top spenders. For
further information, please refer to Section 14.3 titled “Information on the Target Company– Business Overview – Live Streaming – Customer Service” of this Circular.

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LETTER TO SHAREHOLDERS
Diversified and High Quality Content
The Target Group attaches great importance to the diversity and quality of the content on
its platforms. The Target Group’s content database encompasses a range of genres
including music, games, education, fashion, art, chatting, handcrafting, fortune telling,
lifestyle and cooking. The diagram below shows some of the content genres that areavailable on 17LIVE:
Diversified content offering
Music

Games

Education

FashionArt

Localised content
Local entertainment veterans

Chatting

Handcrafting

Fortunetelling

Lifestyle

Cooking

Exclusive premium content

Local top stars

Celebrity live streaming

In-house developed shows

The Target Group ensures a sustainable supply of innovative, original and unique content
by contracting with talented live streamers. The Target Group recognises that it is crucial toadopt localisation strategies to tailor to and satisfy user’s cultural preferences andemotional needs in each region. The content created by the live streamers on 17LIVE iscarefully curated by local, on-the-ground and culturally sensitive operation teams. Such
localised content is then recommended to each targeted user by leveraging its data
insights. The Target Group also leverages its strategic partnerships and collaborations withlocal celebrities, politicians and athletes to produce insightful content which is exclusive to
17LIVE. For example, in Taiwan, the Target Group invited politicians to live stream on
17LIVE, including the Taiwan president, Tsai Ing-Wen (蔡英文) and the former mayor of
Taipei, Ko Wen-Je (柯文哲). In Japan, the Target Group collaborates with local
entertainment veterans such as CAPCOM and SEGA to create bespoke user interface on
its platforms and to license and use their game characters and designs on 17LIVE during
the collaboration period. In particular, the CAPCOM and SEGA game themed userinterfaces are able to promote CAPCOM’s new games and SEGA’s Yakuza and Sonic
Superstar games while raising the Target Group’s brand awareness among CAPCOM and
SEGA game players respectively. The Target Group also invites top YouTubers such as
Hikaru 3 to feature and stream on 17LIVE. Furthermore, the Target Group produces original
in-house shows featuring live streamers such as “17 Unbox (17瘋開箱)”.

3

Hikaru is a popular Japanese YouTuber who has over 4 million subscribers as of 30 June 2023.

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LETTER TO SHAREHOLDERSThe Target Group’s deep understanding of the popular sub-cultures, particularly in Japan,
underpins the emergence and growing popularity of its V-Liver content. As a pioneer in
V-Liver offerings, the average V-Liver MAS on 17LIVE was approximately 1,300 for
1H FY2023.
Strong Live Streamer Community Empowered by the Target Group’s End-To-End
Talent Management Capabilities
Live streamers are one of the most valuable resources of the Target Group. 17LIVE has alarge base of live streamers of approximately 87,000 Contracted Streamers as of 30 June
2023. For 1H FY2023, the average Contracted MAS was approximately 14,000 and since
FY2021, the average monthly streaming hour per Contracted MAS consistently exceeds
40 hours, demonstrating the activeness, stickiness and commitment of live streamers to
17LIVE.
The Target Group offers live streamers a stage to showcase their talents, tools to hone theirprofessional performance skills and opportunities to discover and express themselves. To
nurture and promote its live streamers, the Target Group has developed a comprehensive
talent management system which begins from the recruitment of talents, the opportunity toenter into exclusive contracts with the Target Group, followed by a three-part training
programme and supplemented by opportunities to attend online and offline events, coupledwith various benefits offered by the “Top Live Streamer Welfare Committee” and the offline
networking and mentoring events held by the talent management team. For further details
on the talent management system, please refer to Section 14.3 titled “Information on theTarget Company – Business Overview – Live Streaming – Live Streamers – Live Streamer
Cultivation” of this Circular. The diagram below illustrates the talent management system of
the Target Group:
1

6

Scouting

Mentorship

2Interviews

3

Contract

Full life-cycle talentmanagement capabilities

5

Uniqueexposure

4

Contract compensation

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LETTER TO SHAREHOLDERS
Through this holistic talent management approach, the Target Group has built a close
community of top live streamers in Japan and Taiwan who are able to develop quality
and meaningful content to engage with users. Naoking, the longest-serving male live
streamer in Japan on 17LIVE, is an example of the Target Group’s success in cultivatingand empowering its live streamers. Naoking started live streaming on 17LIVE as alifestyle streamer in 2017, and grew to have approximately 771,000 followers as of 30
June 2023. Please refer to Section 14.3 titled “Information on the Target Company –Business Overview – Live Streaming – Live Streamers – Case Studies” of this Circularfor further details.
Diversified Growth Drivers Empowering Sustainable Organic Growth
Since 2015 and with over eight years of operational know-how, the Target Group has built
a strong foundation of live streaming operations which serves as a base for new growth
initiatives.
The Target Group’s user database and analytical capabilities allow it to generate user
insights and introduce new business initiatives that capture the mind share of its user base.
The Target Group has synergistic competitive advantages across business segments whichenables it to unlock growth opportunities, including the following:•

V-Liver. According to the IMR Consultant, the market size for virtual idol in Japan is
expected to increase from US$973.3 million in 2023 to US$3,864.8 million in 2027,
representing a CAGR of approximately 41.2% from 2023 to 2027, presenting an
attractive growth opportunity for the Target Group. Leveraging the Target Group’s
existing knowledge and insights from its live streaming operations, the Target Group
creates innovative and creative V-Liver content by the expansion of organic V-Livers
to create PUGC and the development of V-Liver proprietary IPs to create PGC.
Organic V-Livers: With the Target Group’s strong brand recognition as the top
pure-play live streaming platform in Japan, the Target Group can attract a large
untapped voice acting talent pool to become a V-Liver on its platforms. Also, the Target
Group expects that there will be an active conversion to V-Liver from the Target
Group’s own large live streamer community. The Target Group integrated the Live2D
functions into the broadcasting functionality on 17LIVE in April 2023, which allows
users to use their smartphones to upload an avatar and conduct virtual streaming
without any additional hardware or software, thereby significantly lowering the barriers
to becoming a V-Liver. The Target Group also integrated the VRM3D and hand gesturerecognition functions in August 2023, deepening immersion among users. The Target
Group incubates V-Liver talent with its end-to-end talent management and helps
V-Livers build a follower base within the 17LIVE ecosystem. The Target Groupleverages online competitions and offline events to discover and foster V-Livers withhigh potential to become V-Liver proprietary IPs.
V-Liver proprietary IPs: The Target Group is the first integrated platform combining
V-Liver agency with its own live streaming ecosystem, thereby connecting proprietary
V-Livers directly with users.

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LETTER TO SHAREHOLDERSThe Target Group collaborates with notable art studios such as HellArts to cultivate
V-Liver proprietary IPs, further diversifying the V-Liver content offerings and attracting
users with different interests. In May 2023, the Target Group held auditions at top voiceactor schools to look for talented voice actors for its V-Liver proprietary IPs. In July
2023, the Target Group created its first five V-Liver proprietary IPs under the name
BUSHILIVE. The Target Group draws traffic to its platforms through live streaming,and concurrently tailors omnichannel marketing strategies to promote each of its
proprietary V-Livers to a wider audience, including featuring such V-Liver profiles inoffline events, TV shows and billboards at train stations. For example, in June 2023,
the Target Group held an offline V-Liver performance in Ikebukuro, Tokyo, where live
streamers and V-Livers performed on stage together. This event attracted
approximately 3,000 fans to participate and support their favourite live streamers andV-Livers. In addition, V-Liver proprietary IPs unlock new monetisation channels suchas offline merchandise sales and music production sales which enhances user
engagement.
The Target Group’s R&D team aims to utilise the existing interactive AR technology tomake V-Liver more lifelike. This allows users to forge a stronger connection with theTarget Group’s V-Liver proprietary IPs.
Following the implementation of the above initiatives of V-Liver development since thestart of 2023, the Target Group witnessed strong growth momentum in its V-Liverbusiness in terms of its V-Liver talent pool, viewer base and engagement. The V-Liverand V-Liver fan community on 17LIVE has approximately 2,000 average V-Liver MAS
and approximately 75,000 average V-Liver MAU in Q2 2023, representing a YoY
increase by 6.5 times and 2.1 times, respectively. The Target Group also demonstrated
strong growth in V-Liver engagement, with an average of approximately 30,000 V-Liver
Spenders per month in Q2 2023, representing a YoY increase by 2.7 times.

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LETTER TO SHAREHOLDERS
V-Liver content taps into a new user and live streamer base which is complementary
to 17LIVE’s current content ecosystem anchored by live streamers. V-Liver content is
expected to improve content diversity and quality, broaden the target market of users
for the Target Group and increase the number of views. The diagram below illustrates
the growth drivers for V-Livers:

Diversified growth drivers: V-Liver

Notes:(1) Based on the IMR Report.
(2) For 2Q FY2023.

•

In-app games. In-app games are one of the value-added services offered by the Target
Group in order to further engage users during live streaming. The Target Group offers
both half-screen casual games that users can play while simultaneously watching live
streams, and half-screen interactive games that users can play together with the live
streamers. The in-app games target the same user base as live streaming while
enriching the overall live streaming user experience by offering continuous
engagement during live streaming. Underpinned by its in-house game development
capabilities, the Target Group has gradually rolled out a number of popular in-app
games in different markets. The average monthly Game Penetration Rate was 25.5%
in 1H FY2023. The introduction of in-app games further diversifies the monetisation
channels of the Target Group as the revenue from the purchases of virtual gameequipment and tools in the in-app casual games is not subject to the revenue sharing
arrangement with live streamers and V-Livers.

•

Live commerce. The Target Group provides infrastructure support and data insights forlive commerce campaigns carried out by top retailers and brands. Throughpartnerships with fast-moving consumer goods brands to analyse consumer
behaviour, the Target Group is able to identify suitable products that satisfy the
shopping needs of the Target Group’s user base, and correspondingly invite theappropriate live streamers to promote such products, as well as attracting further
traffic. By leveraging the popularity and size of the Target Group’s readily available live
streamers, live commerce has successfully filled certain existing market gaps in Japanand Taiwan. For instance, the Target Group’s HandsUp platform helped Hyundai sellcars via live commerce, being the first cars to be sold through live streaming in Japan
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LETTER TO SHAREHOLDERS
in 2022. Furthermore, the Target Group achieves synergy through cross-selling where
goods in one geographical market can be actively promoted and sold to the users
based in another geographical market, enlarging the product outreach and target
segment. Live commerce in Japan also benefits from the Target Group’s local
merchant network and marketing efforts such as business-to-business events andoffline festivals for users and live streamers to attend and interact. The Target Group
has also implemented an event-style approach in Japan where live streamers compete
to promote sales. In Taiwan, the Target Group utilises its Taiwan influencer network forcross-border live streaming shopping trips supported by HandsUp and OrderPally. Asof 30 June 2023, HandsUp and OrderPally served 918 merchants. In Taiwan, theTarget Group launched 17Shop, a marketplace, on 17LIVE in July 2023, where bothlive streamers and V-Livers can sell their original merchandise on 17Shop currently.
The Target Group strives to be a preferred live commerce destination for retailers andbrands. The diagram below illustrates the large and growing total addressable market
for the Target Group’s growth drivers:

Diversified growth drivers: Large and growing total
addressable market
Rapidly growing total addressable market1
Key drivers of media &entertainment industry
Live commerce
Increasing digital natives

US$6.1bn (2027E)+ 22.7% (2023-2027F) - Taiwan+ 43.6% (2023-2027F) - Japan

Rise of digital media platforms
leading to a positive viewing
experience with technology

V-Liver
US$3.9bn (2027E)+ 41.2% (2023-2027F) - Japan

Increasing awareness globallytowards the Asia market

Emergence of popular artists
using social media platforms

Live streaming
US$7.8bn (2027E)+ 11.2% (2023-2027F) - Taiwan+ 22.0% (2023-2027F) - Japan+ 19.2% (2023-2027F) - SEA

Live streaming and gaming
industry – major growth driversof media and entertainment

Note:(1) Total addressable market for (a) live commerce is in respect of Japan and Taiwan, (b) V-Liver is inrespect of Japan, and (c) live streaming is in respect of Japan, Taiwan and Southeast Asia.

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LETTER TO SHAREHOLDERS
Leading Technology Capabilities with Innovative Technology and Superior Safety
RecordAs a technology-driven live social entertainment platform, the Target Group has madeextensive investment to enhance its R&D capabilities and scalable technology stacks inorder to effectively innovate its product offerings and ensure content and data security. Asof 30 June 2023, the R&D team comprises of 289 employees, which constitutes
approximately 34.0% of the Target Group’s total workforce.
The R&D team is able to promptly and effectively implement the Target Management’s
business initiatives by providing the necessary technological infrastructure andfunctionality. For example, most of the in-app games available on 17LIVE were developed
in-house. The Target Group also successfully integrated the Live2D, VRM3D and hand
gesture recognition functions into the broadcasting functionality, allowing its users to use
their smartphones to upload an avatar and conduct virtual streaming and create an
immersive experience for users with V-Livers. In addition, the Target Group’s platforms
maintain an ultralow latency4 with the Target Group’s S+ latency technology and highstreaming quality.
Key features of the platform include:•

in-stream gifts supported by AR;•

interactive in-app games featuring V-Livers and in-app game characters;•

Live2D functions to support amateur V-Livers by significantly lowering the barriers to
becoming a V-Liver;•seamless integration of, and interaction between live streamers and V-Liver withultralow latency in the same physical space;•real-time recommendation and monitoring of content through recognition of audio,
video and text and analysis of behavioural data leveraging the Target Group’s large
user base and big data analytic capabilities; and•real-time and low-lag participation by large number of live streamers in offlinecompetitions physically located close to one another.

Besides new product launches, the R&D team also places strong emphasis on the security
features implemented on the Target Group’s platforms. For example, the Target Group has
SkyEye, a dedicated multi-lingual content monitoring team that is aided by a proprietary
software consisting of AI models developed in-house by the Target Group. It has been
responsible for the security of the Target Group’s platforms since 2015. The Target Grouphas implemented extensive data security measures, including the categorisation of data,
anonymisation of personal data, restricted access to databases and secured backup
mechanism. In recognition of its efforts in data security, the Target Group has been awarded
ISO 27001 and ISO 27017 certifications.

4

Ultralow latency refers to a network that can process a high volume of data with very little delay.

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LETTER TO SHAREHOLDERS
Scalable Business Model with Sustainable Growth and Profitability
The Target Group adopts a profitability business strategy by leveraging on its core live
streaming business to generate strong cash flows and drive new initiatives. The diagram
below illustrates the building blocks for the Target Group’s profitability business strategy:

Return Driven
Customer Acquisition

Content & Partnership
Driven Marketing

ROI Focused Online &Offline Events

Increase Monetisation
Opportunities Via
Cross-selling

Focus on Higher
Margin Initiatives

Obtain Operational
Efficiency From
Economies of Scales

The Target Group’s live streaming business model includes various monetisation channels
which enables it to achieve sustainable growth and operating profitability. In particular, theTarget Group has achieved positive EBITDA since FY2020 with a stable EBITDA margin.
The Target Group’s growth is driven by the following competitive advantages:•

low customer acquisition cost from strong brand image and cost-effective marketing;•unique content to drive organic user growth;•

unparalleled event capabilities with proven ROI and efficiency; and•economies of scale from accumulated operational knowledge and capabilities.
17LIVE Group Adjusted EBITDA
Adjusted EBITDA Margin

US$ million

35

33.3

30
25

10.4%
8.1%

20

17.4

15.9

15.7

15
4.4%
10

3.5%
2.2%

5
4.3
FY2020

FY2021

FY2022

1H 2022

Adjusted EBITDA (US$)
Adjusted EBITDA Margin149

1H 2023

LETTER TO SHAREHOLDERS
In addition to its current growth drivers, the Target Group’s new business initiatives further
contribute to its sustainability and profitability growth. New business initiatives such as
V-Liver content, in-app games, and live commerce diversify the Target Group’s
monetisation channels to achieve profitability. At the same time, the Target Group has
achieved cost-effective expansion into new business segments by leveraging its existinguser base, data insights, operational know-how and technology capabilities accumulated
from its live streaming business.
Visionary Management with an Entrepreneurial Company Culture
As an early mover in the live social entertainment industry, the Target Group believes thatit has propelled the development of the industry and plans on continuing to do so. A
seasoned and professional management is instrumental to the Target Group’s continued
success. The Target Group’s track record of successful operations and its leading market
position bear testament to the management teams’ leadership and execution capabilities.
The Target Group adopts a decentralised, bottom-up organisation structure with local teams
led by local management in each of the major markets it operates in. This allows the Target
Group to gain first-hand intelligence on the market as well as its users, and to react quickly
to changing user preferences in each major market.
The Target Group was co-founded by Mr. Phua Jiexian Joseph. Mr. Phua is a highly
respected entrepreneur with professional expertise in finance and corporate managementwith over 10 years of experience in entrepreneurship. Mr. Phua now serves as the chairmanof the board of directors of the Target Company.
The Target Group has a dedicated management team with extensive experience in the live
social entertainment industry, which enables it to continue its market penetration, adhere toits commitment to user experience, and execute new business initiatives such as V-Liver,live commerce and in-app games. The Target Management’s key experience is set out
below:Name
Mr. Lien Chien-Lin

Position

Key Experience

CEO

•
•

•

•

150

Over 15 years of experience in thedigital entertainment industry.
Held management positions in various
Fortune 500 companies including
Starbucks with hands-on experience inglobal operations.
Extensive experience in the gamedevelopment and entertainment
industries accumulated from his tenure
at various game development andentertainment companies, includingElectronic Arts.
Chief Operating Officer in a mobile
game start-up in Shanghai focusing on
narrative and user-generated content.

LETTER TO SHAREHOLDERS
Name
Mr. Ng Jing Shen

Position

Key Experience

CTO

•
•
•

•

Mr. Kenta Masuda

CFO

•
•
•

Over 15 years of experience in thetechnology industry.
Co-founder of Paktor Pte. Ltd., a dating
and social networking platform.
Founder of Restless, a platform forusers to browse, search and book
activities online.
Software engineer at Amazon.com,
where he was part of the team that
re-architected the backbone of
Amazon’s first cloud computing service.
Over 14 years of experience in thefinance industry.
Certified public accountant in Japan.
Served as the head of financial
planning and analysis and treasury of
the Japan branch of a multinational
retail corporation.

In addition, the Target Group fosters a corporate culture in line with its mission statement
which helps to encourage the retention and dedication of its employees while attracting new
employees who share similar values. It has introduced equity incentive plans and promotion
systems for a wide range of employees and consultants to attract top talent in the market
and motivate its employees with clear career paths which benefit their long-term
development.
15.

PROSPECTS, BUSINESS STRATEGIES AND FUTURE PLANS

15.1 Trend Information
Based on the revenue and operations of the Target Group as of the Latest Practicable Dateand barring unforeseen circumstances, the Target Group’s Directors have made thefollowing observations for the 12 months from the Latest Practicable Date:(a)

General economic and market conditions will have an impact on the media andentertainment industry as a whole and the live online social entertainment segmentthat the Target Group focuses on. These may include (i) the resumption andnormalisation of offline social interactions and economic activities following the end of
the COVID-19 pandemic which may lead to a decline in the usage of the Target
Group’s products and services, (ii) the ongoing war in Ukraine and trade sanctions
imposed on Russia, which had a negative impact on the global economy and may
continue to have a negative impact, (iii) the discharge of the treated radioactive
wastewater from the Fukushima nuclear power plant into the sea and for which theimpact is unforeseen at the moment and (iv) the potential slowdown in the global
economy, in part due to the elevated interest rates set by various major central banks
in the world and the escalation of geopolitical tensions. These will lead to foreignexchange fluctuations and affect the spending power of users.

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LETTER TO SHAREHOLDERS(b)

As set out in Section 15.3 titled “Prospects, Business Strategies and Future Plans –Business Strategies and Future Plans” of this Circular, the Target Group intends tooffer new products, invest in new technology and infrastructure as well as expand into
regional markets. Such plans entail additional operating expenses and R&D expenses
to support the expansion into regional markets. The Target Group expects its revenue
sharing fees to increase along with the expansion of its business, however the Target
Group expects the percentage of revenue sharing fees of the total net revenue todecrease due to increasingly diversified revenue streams and strengthened pricenegotiating power of the Target Group.

(c)

As with many businesses, the Target Group expects to face inflationary pressures anda general trend of increase in overhead costs such as the server and bandwidth
service costs and technology expenses. In particular, the Target Group expects its
server and bandwidth costs to increase due to the growth in user base and user
engagement as the Target Group releases more products and content. However, theTarget Group expects the percentage of bandwidth costs of the total net revenue todecrease due to economies of scale and upgrade in technology infrastructure.

(d)

The Target Group expects its ongoing financial results and financial position to beaffected by the compliance costs of a public listed company, as well as the one-timelisting expenses recorded in its financial statements for FY2023 in respect of its listing
expenses incurred in connection with the Proposed Business Combination. Pleaserefer to Section 22.3 titled “Use of Proceeds – Use of Proceeds Raised from the PIPE
Financing and Completion Remaining Escrow Amount” of this Circular for further
details in relation to our listing expenses.

Saved as disclosed above and in Section 18 titled “Management’s Discussion and Analysisof Financial Position and Results of Operations of the Target Group”, Section 15 titled“Prospects, Business Strategies and Future Plans” and Section 16 titled “Risk Factors” ofthis Circular and Appendix A titled “Independent Auditor’s Report and Audited Consolidated
Financial Statements of the Target Group for the Financial Years Ended 31 December 2020,2021 and 2022” and Appendix B titled “Interim Consolidated Financial Statements of theTarget Group for the Six-Month Period Ended 30 June 2023” to this Circular, and barring
any unforeseen circumstances, the Target Group’s Directors are not aware of any othersignificant recent trends in the costs and prices of its products, or any other known trends,
uncertainties, demands, commitments or events that are reasonably likely to have amaterial and adverse effect on its net sales or revenue, profitability, liquidity or capital
resources, or that would cause the financial information disclosed in this Circular to be notnecessarily indicative of its future operating results or financial information. For more
information, please refer to the section titled “Cautionary Note on Forward-Looking
Statements” of this Circular.
15.2 Order Book
Due to the nature of the Target Company’s business, it does not maintain an order book andthe concept of an order book is not meaningful to the Target Company.
15.3 Business Strategies and Future Plans
The Target Group plans to pursue the following strategies to further grow its business andcreate synergistic returns.

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Continue to Foster Quality Live Streamers and Content to Build the Live Streaming
Ecosystem
The Target Group’s business revolves around its ability to attract users with high quality anddiversified content provided by its live streamers. To that end, the Target Group will continue
its strategic recruitment of live streamers, including collaboration with talent agencies,
acquisition of high quality contracted live streamers from talent agencies, live streamerreferral programmes, scouting and recruiting potential talents through various ways, suchas cold calls on social media and giving name cards to street performers. The Target Groupwill continue to strengthen its partnerships with Japan and Taiwan media and entertainment
companies and celebrities, so as to expand its pool of quality live streamers and V-Livers.
In particular, the Target Group will invite more celebrities to stream on featured channels inorder to produce original content exclusive to 17LIVE, thereby improving the 17LIVE brandimage and diversifying its user base.
The Target Group also plans to expand its market share of V-Liver content throughcontinuous investment such as acquiring talent agencies with high quality contracted
V-Livers. Training high quality V-Livers requires significant amount of know-how and time.
The acquisition of talent agencies allows the Target Group to be more efficient and effective
in building a more comprehensive industry ecosystem, fostering strong partnerships andcapturing a larger market share. The Target Group can also benefit from acquiring
additional talent management professionals, thereby enhancing its in-house talentmanagement capabilities.
In order to sustain the live streaming ecosystem, the Target Group will continue to offer
competitive compensation according to the performance of live streamers to retain talented
live streamers and further invest in strategic marketing channels to strengthen its market
position in Japan and Taiwan, especially by reinforcing its event-driven brand image andupscaling live streamers exposure. The Target Group believes that the successfulacquisition and retention of live streamers will increase the quality of content on 17LIVE,
which is crucial to attract more users to the Target Group’s platforms.
Further Strengthen User Engagement and Loyalty by Curating Streaming Content
and Offline Events
The Target Group’s ability to engage users is the key to its success. The Target Group willfurther enhance localisation efforts to identify and tend to the cultural preferences of users
in each region, as well as diversify online competitions and offline events to improve user
engagement, interactions and loyalty. The Target Group organises uniquely themed
activities and design localised virtual gifts regularly to celebrate traditional festivals in
different regions. The Target Group will continue to organise localised events and expand
such events to regional cities and prefectures in Japan and Taiwan, thereby scouting morepotential talents and attracting more users to 17LIVE. For example, in June 2023, the Target
Group launched a two-day 17LIVER Expo, a stage event in Taiwan featuring offline
performances by live streamers, V-Livers and local pop stars from various regions including
Japan and Taiwan, as well as a weekend market at which localised physical merchandiseand street food were sold. The Target Group collaborated with local brands, such as Taihu
Brewing, and invited local politicians such as former mayor of Taipei, Ko Wen-Je (柯文哲),to participate in the 17LIVER Expo. The 17LIVER Expo attracted approximately 37,500
participants and generated publicity for the Target Group. Leveraging its capability toorganise large-scaled brand partnership events, the Target Group plans to organise more
events partnering with high quality brands to stimulate the interactivity between users andlive streamers, and the competition among Contracted Streamers.
153

LETTER TO SHAREHOLDERSThe Target Group plans to promote V-Livers through organising more events such as having
17LIVE V-Livers at the Tokyo Game Show. The Target Group also plans to partner with top
V-Livers agencies in Japan to invite their V-Livers to stream on its platforms and participate
in online competitions and offline events. With these localised content and offline events,
the Target Group expects to foster seamless interactive communications and engagement
among live streamers, V-Livers and users within its live streaming ecosystem. The Target
Group collaborates with game companies in Japan and features their game characters onlive streams or creates collaborative content with the Target Group’s V-Livers, thereby
diversifying the user base and monetisation channels. For example, the Target Groupturned Street Fighter characters in CAPCOM into unique interactive gifts for live streams
and allowed V-Livers to collaborate with the Street Fighter fan community.
Continually Expand Product Offerings across the Target Group’s Ecosystem
The Target Group’s growth focus is on high-margin V-Liver initiatives such as sponsorshipand licensing arrangements to be achieved through the anticipated popularity of proprietary
V-Liver IPs, and leveraging the core capabilities accumulated in its live streaming business,
the Target Group will further invest in the development of its V-Liver proprietary IP and
V-Liver-related technology, as well as enhancing its V-Liver related live commerce offering.
The Target Group intends to further develop its PUGC and PGC content in relation to its
V-Liver offering. The Target Group’s technology and talent management expertise lowers
the barriers to become a V-Liver and makes V-Liver live streaming widely accessible,
thereby furthering the development of PUGC content. Leveraging the launch of Live2D
functions in April 2023 and the VRM3D and hand gesture recognition functions in August
2023, the Target Group will continue to enhance its broadcasting functionality by integrating
features in order to lower the barriers to become a V-Liver and to create immersive
experiences for users consuming V-Liver content. The Target Group will also further
empower individual V-Livers through opportunities to participate in online competitions andoffline events to build their fan base more easily and offer competitive compensation fromvirtual gift and subscription, diversifying the income stream of V-Livers, thereby breaking
the traditional model where success is tied to debuts associated with top agencies. In
addition, as the pool of contracted V-Livers grows, the Target Group aims to pursue new
profitability growth streams and create additional revenue models from its V-Liver offerings,
such as merchandise sales, concerts, performances and commercial collaborations suchas the licensing of organic V-Liver and V-Liver proprietary IPs to brands.
To further increase its PGC content, the Target Group intends to acquire V-Liver IPs fromtalent agencies and to further launch 20 proprietary V-Liver IPs through its collaborations
with animation studios such as HellArts. As of the Latest Practicable Date, the Target Group
has acquired more than 80 V-Liver IPs, of which over 60 V-Livers have already started
streaming. The Target Group has funded, and intends to fund, the payment for these V-Liver
IPs through cash and cash equivalents on hand. These collaborations will create uniquecharacters targeted at the Japanese audience to create more original content and increase
the following of V-Livers on its platforms. The Target Group intends to fully own the IP rightsof these characters and aims to promote and develop them to become V-Liver idols andcreating V-Liver idol groups such as BUSHILIVE. The Target Group aims to unlock further
monetisation channels by entering into sponsorship and licensing arrangements with gamedevelopers and merchandise companies, who may be interested in sponsoring or licensing
the image and/or voice of the Target Group’s popular V-Livers for their own promotional
activities. The sponsorship or licensing fees received by the Target Group will be sharedwith the V-Livers involved, at the pre-agreed revenue sharing percentage between the154

LETTER TO SHAREHOLDERS
Target Group and the V-Livers. As of the Latest Practicable Date, the Target Group has notentered into any such sponsorship or licensing arrangements.
In addition to V-Livers, the Target Group also plans to expand its live commerce offerings.
The Target Group endeavours to increase its live commerce penetration rate by expanding
its live commerce business to include a B2B2C model, allowing brands to collaborate withlive streamers and enabling customers to purchase goods within 17LIVE, where brands caneasily upload products for live streamers to market, and live streamers can select the
products they want to sell during their live streaming. The Target Group believes that its richand dynamic content offerings will allow users to enjoy more immersive, comprehensive
and integrated social experience on real-time basis and maintain and reinforce its leading
position in the live social entertainment industry.
Invest in New Technology and Infrastructure Upgrades to Enhance User ExperienceAs an online live social entertainment platform, a well-established technologicalinfrastructure is of paramount importance to the Target Group. The Target Group iscommitted to investing in cutting-edge technologies and continually developing andupgrading technologies such as AI and AR to support its business growth. In particular, theTarget Group will reinforce its customised recommendation and user behaviour analysis to
more effectively identify high potential live streamers, analyse the needs and preferencesof its users, and design, promote and manage more customised products and tailoredservices to enhance user experience. The Target Group also intends to develop better
content-search tools to help its users search for and find the content they want more easily
and to develop new functionalities to allow users to access records of historical streams
whenever they desire. The Target Group believes that maintaining and upgrading its
technology infrastructure will empower it to continue to attract new users and engender
greater user loyalty. For instance, the Target Group utilises generative AI to create anexperimental V-Liver who acts as a female character and performs fortune telling to users,
the diagram below shows such experimental V-Liver performing fortune telling on 17LIVE:

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LETTER TO SHAREHOLDERS
Expand Footprint by Exporting Our Expertise into High Growth Markets
Leveraging its strong live social entertainment presence in Japan and Taiwan, the Target
Group will strategically expand its business into regional markets with high growth potential
such as Southeast Asia which is seen as a fast-growing live streaming market. According
to the IMR Consultant, the market size for live streaming for Southeast Asia is expected toincrease from US$1,071.8 million in 2023 to US$2,160.9 million in 2027, representing amoderated CAGR of approximately 19.2% from 2023 to 2027. The Target Group is expected
to benefit by experiencing growth in user base from brand recognition in Southeast Asia,and particularly, in Singapore, after the Completion. The Target Group plans to efficiently
utilise its available content to build a critical mass of users in Southeast Asia, with a viewto achieving organic growth through cross-border activities and the export of Japanese andTaiwanese content and merchandise to Southeast Asia through a combination of live
streaming, its live commerce channels and 17Shop. The Target Group plans to make its
Japan V-Liver content available in other countries once the Japan V-Liver offering reaches
a more mature stage. The Target Group will continue to promote cross-border collaborative
streaming among its live streamers where live streamers located in different regions live
stream together as a group. The Target Group also plans to acquire more live streamers andusers in Southeast Asia to complement and strengthen the Target Group’s core live
streaming business and reach a larger audience base in these markets. To this end, theTarget Group may collaborate or partner with media and entertainment companies inSoutheast Asia.
In addition to organic growth, the Target Group plans to expand its products and services
offerings by driving long-term growth through pursuing strategic investment opportunities(such as investments in other quality social media products and platforms), mergers andacquisitions, joint ventures and/or strategic alliances with parties that create synergistic
values with its current business. The Target Group believes that horizontal or verticalinvestments and acquisitions will allow it to further expand its presence and strengthen its
market leading position in Asia and achieve success in the new markets or product niches
that it elects to enter. Should such opportunities arise, the Target Group will seek approval,
where necessary, from shareholders and the relevant authorities in accordance with therequirements of the applicable rules and regulations.
16.

RISK FACTORS
Shareholders and prospective investors should carefully consider and evaluate each of thefollowing risk factors and all other information contained in this Circular before voting on the
resolutions in respect of the Proposed Transactions.
The following describes some of the significant risks known to the Target Company and theCompany now that could directly or indirectly affect the Target Company, the Enlarged
Group and the Proposed Business Combination, including the risks that relate principally tothe industry in which the Target Company operates and its business in general. Other risks
relate principally to the general social, economic, political and regulatory conditions in
Singapore, Japan and Taiwan, the securities market and ownership of the Shares following
Completion, including future dilution in the value of the Shares. The risk factors set out
below are not intended to be exhaustive and do not state risks unknown to the Target
Company and the Company now but which could occur in future, and risks which the Target
Company and the Company currently believe to be immaterial, which could turn out to bematerial. Should these risks occur or turn out to be material, they could materially andadversely affect the Target Company’s or the Enlarged Group’s business, financial position,
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LETTER TO SHAREHOLDERS
results of operations and/or prospects. New risk factors may emerge from time to time andit is not possible for the Directors and the Proposed Directors to predict all risk factors, nor
can the Company assess the impact of all factors or the extent to which any factor or
combination of factors may affect the Target Company, the Enlarged Group and the
Proposed Business Combination.
Save as disclosed below, to the best of the Directors’ and the Proposed Directors’knowledge and belief, all risk factors which are material to Shareholders in making an
informed judgement of the Target Company and the Proposed Business Combination havebeen set out below.
Shareholders should also note that certain of the statements set forth below constitute“forward-looking statements” that involve risks and uncertainties. For more information,please also refer to the section titled “Cautionary Note on Forward-Looking Statements” ofthis Circular. Following Completion, the risk factors in relation to the Target Group will also
be relevant to the Enlarged Group. If any of the following considerations, uncertainties ormaterial risks develops into actual events, the business, financial condition, operational
results or prospects of the Enlarged Group may be materially and adversely affected. Insuch circumstances, the trading price of the Shares could decline, and Shareholders may
lose all or part of their investment in the Shares.
16.1 Risks relating to the Business and Industry of the Target GroupIf the Target Group fails to retain its existing users, keep them engaged or grow theuser base, the business, operation, profitability and prospects of the Target Groupmay be materially and adversely affected.
There is no assurance that the Target Group can effectively retain its existing users, keepthem engaged or grow its user base. The Target Group has an average MAU of
approximately 550,000 globally on 17LIVE for 1H FY2023. If the user base decreases, orthe users access the Target Group’s platforms less frequently or become less active, theywould likely spend less on virtual points and virtual gifts or other products and services on
the Target Group’s platforms. This would in turn drive live streamers and V-Livers away fromthe Target Group’s platforms, reduce the amount of high quality content on its platforms,
and discourage merchants from selecting the Target Group’s platforms, thereby materiallyand adversely affect the Target Group’s operational results, revenues, financial conditionand prospects.
A number of factors could negatively affect user retention, growth and engagement,
including if:•

the Target Group fails to adapt to changes in user preferences, or innovate andintroduce new content, features and services to attract new users;•

the Target Group fails to retain and continue to discover popular live streamers andV-Livers, or the live streamers and V-Livers fail to keep the users engaged over a
period of time;•

the Target Group is unable to address inappropriate or abusive use of its platforms,
which may lead to negative public perception of the Target Group and its brands;•

the Target Group is unable to deliver its services in a prompt and reliable manner due
to information technology issues or other technical problems which adversely affectthe user and/or live streamer’s experience;
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LETTER TO SHAREHOLDERS•

the Target Group fails to deliver satisfactory performance in its new business initiatives
such as in-app games, V-Liver offering and live commerce;•

the Target Group fails to address users’ concerns relating to privacy andcommunication, safety, security or other factors;•

aggressive monetisation measures by the Target Group cause users to shift to otheralternative platforms; and•there are adverse changes in the Target Group’s services that are mandated by, or anelection by the Target Group to address legislation, regulations or government
policies.

To the best knowledge of the Target Group, during the Period Under Review and up to theLatest Practicable Date, there has not been any occurrence of the factors described above
resulting in a material adverse impact to the Target Group’s operations and/or financials.
It is vital that the Target Group remains responsive to evolving user preferences and offers
content that attracts its users, especially its paying users. The Target Group will need tocontinue to develop and improve its platforms, to enhance its brand awareness andstimulate user engagement, which may require it to incur substantial costs and expenses
and there is no assurance that such efforts will be successful. If such increased costs andexpenses do not effectively translate into improved user traffic and engagement, its
operational results may be materially and adversely affected.
If the Target Group fails to attract, cultivate, manage and retain its popular live
streamers and V-Livers or if the content created by the Target Group’s live streamers
and V-Livers becomes less engaging to the users, the business, operational results
and prospects of the Target Group may be materially and adversely affected.
The Target Group’s business revolves around its ability to attract and retain popular live
streamers and V-Livers producing high quality original content. These talented live
streamers and V-Livers generally have a large follower base who regularly supports themwith virtual gifts during their live streams and offline events. Their talent and capability togenerate high quality content are the primary contributors to user stickiness.
The Target Group faces significant competition for talented live streamers and V-Livers fromother platforms. The Target Group enters into standard contracts with live streamers andV-Livers directly or through the agencies of the live streamers and V-Livers, some of which
are exclusive and contain non-compete obligations on the live streamers and V-Livers
during the term of their contracts and for up to 12 months after their contracts are
terminated. Live streamers and V-Livers who do not enter into exclusive agreements with
the Target Group can broadcast the same content concurrently on other platforms. Despite
the contractual restrictions, some live streamers and V-Livers may decide to broadcast on
other platforms in breach of the exclusivity agreements, which could result in an outflow ofusers and reduction in revenues of the Target Group. In addition, the Target Group’s live
streamers and V-Livers may not be willing to renew their contracts with the Target Group if
the terms in the standard contracts are no longer attractive to them. If the Target Group
loses a substantial number of popular live streamers and V-Livers, its ability to stream
content may be negatively affected and the attractiveness of its platforms to users may besignificantly reduced. Furthermore, for those live streamers and V-Livers who are managedby talent agencies, the Target Group may lose them if the talent agencies that manage them158

LETTER TO SHAREHOLDERS
fail to reach or maintain satisfactory cooperation arrangements with such live streamers
and V-Livers or with the Target Group. The Target Group may not be able to find new live
streamers and V-Livers who are able to generate appealing content to meet the users’
demands.
To retain popular live streamers and V-Livers, the Target Group must devise more effective
live streamer and V-Liver cultivation programmes and more competitive live streamer and
V-Liver compensation schemes, improve its monetisation strategies and help popular live
streamers and V-Livers appeal to a wider audience. Even with its efforts in these respects,
there is no assurance that the Target Group’s live streamers and V-Livers will not leave its
platforms.
The Target Group implements certain live streamer and V-Liver performance metrics toidentify, track and train promising live streamers and V-Livers to achieve greater popularity.
However, there is no assurance that the performance metrics the Target Group uses to track
its live streamers and V-Livers are effective in projecting future success, as changes in user
preferences are often sudden and unpredictable. Some of the live streamers and V-Livers
the Target Group identifies as promising in the early stage of their careers may not gain
popularity, and some of the live streamers and V-Livers that have not been identified aspromising live streamers and V-Livers may unexpectedly achieve widespread popularity.
The Target Group may not be devoting the appropriate level of resources to talented live
streamers and V-Livers, which could weaken its core competitive strength of creating highquality content and thus cause a reduction in the user base. In addition, the Target Group’s
popular live streamers and V-Livers may fail to deliver engaging and original content, or
face a decline in popularity due to negative publicity, scandals, allegations of illegal acts orlitigations, which could negatively affect the Target Group’s ability to facilitate user
engagement and spending and lead to a loss of the Target Group’s live streaming revenue,
and ultimately, materially and adversely affect its operational results.
The Target Group also seeks to foster a broader and more engaged community, andencourages influencers, celebrities and other public figures, media outlets andorganisations with media rights to use its platforms to express their views and share highquality content. However, there is no assurance that this strategy will be successful ingenerating user traffic and stimulating spending. If the Target Group fails to attract highquality live streamers and V-Livers and correspondingly increase engagement from its
users, its business, operational results and prospects may be materially and adversely
affected.
The Target Group’s business is based on a business model where user demand maychange or decrease substantially, and it may not be able to successfully implement
its monetisation strategies to generate sustainable revenue and profits.
Many of the elements of the Target Group’s business, such as virtual gifting, V-Livers,
in-app games and live commerce, are constantly changing. The markets for the Target
Group’s products and services are rapidly developing and are subject to significant
challenges. The Target Group’s business relies heavily upon revenues from its live
streaming business, as well as its ability to successfully monetise its user base andproducts and services. As the live social entertainment industry in Asia is constantly
changing as well, there are few proven methods of projecting user demand or available
industry standards on which the Target Group can rely, and the Target Group has toconstantly develop and update its monetisation strategies.

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LETTER TO SHAREHOLDERSThe Target Group’s current operations are substantially based on a business model where
the content on its platform is freely accessible by users, who may choose to purchasevirtual points, which can be used to purchase various virtual gifts on its platforms. The
prices of virtual points and virtual gifts are fixed by the Target Group based on its internal
pricing mechanism which aims to strike a balance between affordability for users andmonetisation for the Target Group, and are neither based on demand nor dynamicallydetermined. Virtual points and virtual gifts cannot be used outside of 17LIVE. Although theTarget Group factors in industry standards and expected user demand in determining how
to optimise virtual gifts and in-app game merchandising effectively, if the Target Group fails
to properly maintain a balance between creating sufficient monetisation opportunities andmaintaining an enjoyable platform, its users may be less likely to spend on the Target
Group’s platforms. In addition, if users’ spending habits change and they choose to only
access its free content without additional purchases, the Target Group may not be able tocontinue to successfully implement the virtual gifts-based and in-app games-based revenue
model, in which case the Target Group may have to resort to other monetisation strategies.
If the Target Group’s strategic initiatives do not enhance its ability to monetise its existing
services or enable the Target Group to develop new approaches for monetisation, theTarget Group may not be able to maintain or increase its revenues and profits or recover
any associated costs. In addition, the Target Group may in the future introduce new services
to further diversify its revenue streams, including services which the Target Group has little
or no prior development or operating experience. If these new or enhanced services fail toengage users, the Target Group may fail to attract or retain users or generate sufficientrevenues to justify its investments, and its business and operational results may suffer asa result.
The Target Group’s new monetisation strategies, including its V-Liver, in-app gameproducts and live commerce offerings, have been launched recently, and there is no
assurance that they will be successful, profitable or widely accepted, and will remain
effective or continue to generate revenue in the future. If the Target Group fails to develop
new monetisation channels and generate sustainable growth, its business, operational
results, financial condition and prospects may be materially and adversely affected.
The Target Group may not be able to successfully maintain and increase the numberof its spenders.
The Target Group generates substantially all of its revenue from selling virtual points to its
spenders. If the Target Group fails to maintain the number of its spenders, or if revenues
generated from its spenders are substantially reduced due to, for example, increased
competition, deterioration in user relationship, or lack of engaging content, its business,
operational results, financial condition and prospects may be materially and adversely
affected. The revenue contribution from the top 10 customers (individual spenders) of theTarget Group accounted for 5.69%, 4.82%, 2.77% and 3.08% of the Target Group’s revenue
for FY2020, FY2021, FY2022 and 1H FY2023. While the Target Group plans to enlarge its
spender base, there is no assurance that the Target Group will succeed. Whether the Target
Group can increase the number of its spenders or their spending depends on many factors.
For example, the Target Group’s spenders may have less disposable income if they needto meet financial obligations elsewhere, they may decide to no longer financially support a
particular live streamer or V-Liver that they used to follow, and an overall worsening
economic climate can lower disposable income for all existing spenders, causing them tospend less on its platforms.

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The unique community culture of the users, live streamers and V-Livers of the Target
Group is vital to its success. Its operations may be materially and adversely affected
if it fails to maintain its culture within its addressable user, live streamer and V-Livercommunities.
The large and highly engaged user, live streamer and V-Liver base of the Target Group is
a community in which the users, live streamers and V-Livers can establish and expand theirsocial relationships based on location and common interests. Leveraging this highlyinteractive community among users, live streamers and V-Livers, the Target Group hasorganised a variety of innovative online competitions and offline events with different
themes to further drive engagement level, cultivate a unique culture and incentivise users
to increase their spending on the platforms. These competitions and events encourage
users to buy virtual points to spend on virtual gifts for their favourite live streamers andV-Livers in order to show support and win. Offline engagement complements the Target
Group’s online offerings by providing a tangible experience for many fans of the live
streamers and V-Livers and also for users to meet up in person to build longer-term
relationships with their favourite live streamers and V-Livers. The Target Group believes
that its unique community culture is vital to its success. If the Target Group fails to createcompetitions and events that meet users’ needs or otherwise fails to foster or maintain its
community culture within its addressable user, live streamer and V-Liver communities, its
platforms may lose attractiveness to its users, live streamers and V-Livers and its
operations may be materially and adversely affected.
The Target Group has a limited operating history in the in-app game sector and may
fail to offer popular in-app games or successfully develop or source new popular
in-app games. If the number of its paying users for in-app games declines or ceases
to grow, the Target Group’s in-app game revenues may decrease, and its operational
results, financial condition and prospects may be materially and adversely affected.
The Target Group has a limited operating history in the in-app game sector with the launchof its in-app games on its Taiwan and Japan platforms in May 2022 and August 2022
respectively. Although the Target Group has achieved rapid growth in the in-app game
sector, there is no assurance that new in-app game projects will be successful. For
instance, the development of new in-app game products may not materialise.
Furthermore, most in-app games have a relatively limited commercial lifespan and users
may not stay engaged over a sufficiently long period in order for the game owners toachieve its projected returns. Similarly, there is no assurance that the in-app games offeredby the Target Group will be sufficiently attractive to users, sustainable and revenue
generating at each stage of their lifecycle. As a result, the Target Group has to continuously
invest resources to develop or source new in-app games. If the Target Group fails to expand
and diversify its in-app game offerings, identify trending and popular genres, or maintain thequality of its in-app games, it may lose users and user engagement and the Target Group’s
operational results could be materially and adversely affected.
The Target Group offers its in-app games to its users who pay by virtual points (which canbe purchased or alternatively, occasionally be obtained for free), and users have the option
to purchase in-game virtual items such as in-game accessories and tools that can boost
performance. However, such strategy may not continue to be effective should the Target
Group fail to attract users. In addition, the Target Group may not be able to accurately trackusers’ preferences and consumption trends to retain its user base and encourage existing
paying users to spend more on its in-app games.
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Although the Target Group mainly develops in-app games in-house, certain in-app games
currently offered on its platforms, such as 17 Soccer, were created by third party gamedevelopers under revenue-sharing arrangements. The Target Group may depend on third
party game developers for technical support and maintenance that are necessary tooperate the in-app games on the Target Group’s platforms and to develop updates. Even
though the Target Group’s in-house in-app game R&D capabilities are advancing andgrowing, if it fails to maintain and expand its in-house in-app game R&D capacity, or fails
to maintain or renew third party game contracts on acceptable terms or at all, the Target
Group may be required to cease the offering of popular in-app games, resulting in an
increase in R&D expenses and a decrease in its revenues, which would have a material
adverse effect to its operational results, financial condition and prospects.
The Target Group’s historical growth rates may not be indicative of its future growth.
If the Target Group fails to effectively manage its growth as a result of the increased
complexity of its business and changes in market conditions, its business,
operational results and prospects may be materially and adversely affected.
The historical growth rate of the Target Group may not be indicative of future performancedue to the constantly changing business model and market conditions. There is no
assurance that the Target Group will be able to maintain the historical growth rates in the
future. For example, the Target Group experienced a drop in for both its number of MAUs
and ARPPU in 2022, due to a decrease in demand for its services as users reduced
entertainment budgets post-COVID-19 pandemic and with the ease of COVID-19 pandemic
restrictions, users gradually returned to more offline activities, resulting in less time spent
on online social and entertainment activities.
Some of these risks and uncertainties relate to the Target Group’s ability to:•retain existing users, attract new users, increase paying user ratio and increase user
engagement and monetisation;•roll out its V-Liver strategies;•

maintain growth rates across its platforms in multiple markets;•

maintain and expand its network of domestic, regional and global business partners;•

upgrade its technology and infrastructure to support increased traffic and expanded
offerings of content and services;•

anticipate and adapt to changing user, live streamer and V-Liver preferences;•

implement its strategy to expand its offerings on its live commerce platforms;•

conduct cost-effective marketing campaigns to increase the awareness andattractiveness of its brands;•

adapt to competitive market conditions, as well as the global economic and politicalconditions;•protect its intellectual property;

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launch new products and merchandise;•hire and retain key employees; and•maintain adequate control of its expenses.

If the Target Group is unsuccessful in addressing any of these risks and uncertainties, its
business, operational results, financial condition and prospects may be materially andadversely affected.
In addition, the Target Group’s growth has placed, and may continue to place significant
demands on the Target Group’s management and its technology systems, as well as its
administrative, operational and financial systems. The Target Group’s ability to manage its
growth effectively will also require the Target Group to continue to implement a variety of
new and upgraded managerial, operating, technological and financial systems, procedures
and controls. There is no assurance that its growth initiatives will succeed. If the Target
Group is not able to effectively manage the growth of its business and operations or execute
its strategies effectively, its expansion may not be successful and its business andprospects may be materially and adversely affected.
The Target Group’s profitability in any prior financial period may not be indicative of
its future profitability.
The Target Group had an operating income of US$24.4 million, US$10.4 million and
US$10.1 million for the financial years ended 31 December 2020, 2021 and 2022
respectively. The Target Group’s profitability in any prior financial period may not be
indicative of its future profitability and the Target Group may incur losses in the near future.
Changes in the macroeconomic and regulatory environment or competitive dynamics andthe Target Group’s inability to respond to these changes in a timely and effective manner
may also impact its profitability.
In addition, the Target Group expects to continue to invest heavily in its operations tomaintain its current market position, support anticipated future growth and meet its
expanded reporting and compliance obligations as a public company, including significant
legal, accounting, insurance, compliance, and other expenses. The Target Group may not
generate sufficient revenue from its core live streaming content and its new businessinitiatives such as in-app games, V-Liver offering and live commerce, to offset such costs
to sustain profitability in the future.
The Target Group may also face increasing operational costs to support its further growthand expansion. The Target Group expects its costs and expenses such as its R&D
expenses, selling expenses (including advertising and marketing expenses) and generaland administrative expenses to continue to increase in the future as it broadens its user, live
streamer and V-Liver base, increases engagement level, and develops and implements
new features and services that require more complexity. The Target Group expects tocontinue to invest in its infrastructure in order to enable it to provide rapid and reliable
services to its users, live streamers and V-Livers. Continued growth could also strain theTarget Group’s ability to maintain reliable service levels for its users, live streamers andV-Livers, develop and improve its operational, financial, legal and management controls,and enhance its reporting systems and procedures. If the Target Group is unable togenerate adequate revenues through its monetisation strategies and to manage its
expenses, it may incur significant losses in the future and may not be able to subsequently
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maintain profitability. The Target Group’s expenses may grow faster than its revenues, andits expenses may be greater than anticipated. Managing the Target Group’s growth will
require significant expenditures and the allocation of valuable management resources. If
the Target Group fails to achieve the necessary level of efficiency in its organisation as it
grows, its business, operational results, financial condition and prospects could be harmed.
In addition, the Target Group may require additional capital from time to time to grow its
business and expand product offerings. Its ability to obtain additional capital is subject tothe following uncertainties:•

market position and competitiveness of the Target Group in the live social
entertainment industry;•

operational results, overall financial condition, profitability and cash flows of the Target
Group;•

general market conditions for capital raising activities; and•economic, political and other conditions in the global economy.

There is no assurance that additional financing will be available on acceptable terms, or atall. If the Target Group is unable to obtain adequate financing or financing on terms
satisfactory to it when necessary, its ability to continue to support the operation and growthof its business could be significantly impaired and its operational results may be adversely
affected.
The business operations of the Target Group are geographically concentrated inJapan and Taiwan. The Target Group may be sensitive to or significantly affected byany adverse change in the Japan and Taiwan markets.
While the Target Group has expanded its business to new geographic areas, it remains
highly concentrated in the markets of Japan and Taiwan. The Target Group’s business is
exposed to unfavourable changes in regulatory conditions, adverse changes in thecompetitive landscape, economic downturns, political risks, as well as the occurrence of
natural disasters in Japan and Taiwan. If the Target Group is unable to identify andsuccessfully manage or mitigate these risks, its business, operational results, financial
condition and prospects may be materially adversely affected.
The Target Group has a limited presence in certain international markets into which
it has expanded or seeks to expand. The Target Group may fail to meet the challenges
presented by its current international operations, or to replicate its success in newmarkets it operates in.
The Target Group operates in various countries and regions across the world. While Japanand Taiwan remain its strategic focus, the Target Group also has users, live streamers andV-Livers in Hong Kong, Singapore, the U.S., the Philippines, India and Malaysia. The Target
Group expects to continue its global expansion as a key growth strategy, which exposes it
to a number of risks, including:•challenges in formulating effective sales and marketing strategies targeting users, live
streamers and V-Livers;

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challenges in localising business strategies to satisfy diverse cultural preferences anddemands in different jurisdictions;•challenges in identifying appropriate local business partners and establishing andmaintaining good working relationships with them;•

local competition;•

challenges in meeting local merchant demands as well as online marketing practices
and conventions;•differences in reception and perception of its applications by users, live streamers,
V-Livers and merchants internationally;•

challenges in building direct sales operations, especially in developed markets;•

fluctuations in currency exchange rates;•

compliance with applicable foreign laws and regulations, including but not limited tointernet content requirements, foreign exchange controls, cash repatriation
restrictions, intellectual property protection rules and data privacy requirements;•

exposure to different tax jurisdictions that may subject the Target Group to greaterfluctuations in its effective tax rate and assessments in multiple jurisdictions on
various tax-related assertions, including transfer pricing adjustments and permanentestablishment;•

ability to hire suitable and experienced employees locally; and•increased costs associated with doing business in foreign jurisdictions.

The Target Group’s business, operational results, financial condition and prospects may bematerially and adversely affected by these and other risks associated with its expansion
internationally.
The Target Group operates in an industry that is highly competitive. If it is unable tocompete effectively, its business, operational results and prospects may bematerially and adversely affected.
The Target Group faces competition in several major aspects of its business, particularly
from companies that provide live social entertainment services such as live streaming,
in-app games and live commerce.
Some of the Target Group’s competitors may have longer operating histories andsignificantly greater financial strength, technical capabilities and marketing resources than
the Target Group does, and in turn may have an advantage in attracting and retaining users,
live streamers, V-Livers, merchants, game developers and business partners. For example,
competitors in some areas of the Target Group’s business may have a significantly larger
user, live streamer and V-Liver base and more established brand names and may be able
to more effectively leverage their user, live streamer and V-Liver base and brand names toreach out to more potential users, live streamers and V-Livers and thereby increase theirmarket share. The Target Group also faces competition from larger companies that could
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devote greater resources to the promotion or marketing of their services, taking advantageof acquisition or other opportunities more readily or developing and expanding theirservices more quickly. The Target Group may also face potential competition from global orregional live social entertainment service providers that seek to enter the markets in which
the Target Group operates, whether independently or through the formation of partnerships,
or acquisition of, internet companies.
The Target Group operates in multiple markets, and in particular, Asia. For further detailsof the Target Group’s competitors across these markets, please refer to Appendix F titled“Independent Market Research Report” of this Circular. Some of these competitors may
enjoy better competitive position in certain geographical regions, user demographics orother key areas in which the Target Group currently operates or will operate in the future.
These competitors may offer more appealing services or respond more quickly andcost-effectively than the Target Group to new or changing opportunities. The Target Groupalso faces competition from other live streaming platforms and other platforms which offer
similar types of content such as short form videos. Due to a low switching cost for users,
live streamers and V-Livers, the Target Group competes intensely with these platforms interms of time spent by users, live streamers and V-Livers, as well as quality content. In
addition, the Target Group faces competition from virtual idol agencies in relation to its
V-Liver offering, and has to capture the market share by continuously introducing attractive
virtual idols, building its intellectual property portfolio, and exploring new collaboration
opportunities. The Target Group also competes with other game developers in relation to its
in-app game offering. Since most online games have a limited commercial lifespan, theTarget Group must continuously develop and source new in-app games that appeal to its
users. In relation to the live commerce business, the Target Group competes with othermarketing services companies, social media platforms and other live commerce platforms,
the success of which depends on the size of its user, live streamer and V-Liver base andengagement level, diversity of products as well as innovation in marketing solutions offered.
The live social entertainment industry is also characterised by rapidly changing
technologies, evolving industry standards, new product and service launches, newgenerations of product enhancements and rapidly changing user preferences. Accordingly,
the Target Group is required to adapt to these rapidly changing technologies and industry
standards, and to continually innovate in response to both evolving demands of themarketplace and the actions taken by its competitors. There may be occasions when theTarget Group may not be as responsive as its competitors in adapting its services tochanging industry standards and the needs of its users. Historically, new features may beintroduced by another player in the industry, and if they are perceived as attractive to users,
live streamers and V-Livers, they are often quickly copied and improved upon by othercompeting platforms. On the flip side, the Target Group may not be able to protect its newtechnologies from being copied by its competitors. Introducing new technologies into its
systems involves numerous technical challenges, substantial amounts of capital andpersonnel resources and often takes many months to complete. While the Target Groupintends to continue to devote resources to the development of additional technologies andservices, it may not be able to effectively integrate new technologies on a timely basis orat all, which may decrease user, live streamer and V-Liver satisfaction with its services.
Such technologies, even if integrated, may not function as expected or may be unable toattract and retain a substantial number of its users. A failure by the Target Group to keep
pace with rapid technological changes may cause it to fail to retain or attract users or
generate revenues, and could have a material and adverse effect on its business andoperational results.

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If the Target Group is not able to effectively compete in any of its lines of business, its
overall user, live streamer and V-Liver base and engagement level may decrease, which
could reduce the number of its paying users or merchants or make the Target Group lesseffective in engaging and retaining its business partners. The Target Group may be required
to spend additional resources to further increase its brand recognition and promote its
products and services, and such additional spending could adversely affect its financial
performance. Furthermore, if the Target Group is involved in disputes with any of its
competitors that result in negative publicity to the Target Group, such disputes, regardlessof their veracity or outcome, may harm its reputation or brand image and in turn lead to a
reduced number of users, live streamers, V-Livers, merchants, game developers andbusiness partners. Any legal proceedings or protective measures taken by the Target Groupin response to such disputes may be expensive, time-consuming and disruptive to its
operations and may divert the attention of the Target Group’s management from thebusiness.
Major mobile application distribution channels may change their standard terms andconditions in a manner that is detrimental to the Target Group, or terminate their
existing relationship with the Target Group.
The Target Group relies on third party mobile application distribution channels such as
Google Play and iOS App Store to distribute most of its mobile applications to users. The
Target Group expects that a substantial number of downloads of its mobile applications willcontinue to be derived from these distribution channels. As such, the promotion, distribution
and operation of its applications are subject to such distribution platforms’ standard terms
and policies for application developers, which are subject to the interpretation of, andchanges by, these distribution channels. If Google Play, iOS App Store or any other major
distribution channels change their standard terms and conditions in a manner that is
detrimental to the Target Group, or terminate their existing relationship with the Target
Group, its business, operational results, financial condition and prospects may bematerially and adversely affected.
Growth and engagement level of users, live streamers and V-Livers depend on theeffective interoperation with mobile and computer technology, operating systems,
networks, devices and standards that the Target Group does not control.
The Target Group makes its services available across a variety of third party mobile anddesktop operating systems and devices. The Target Group is dependent on operating its
services on popular mobile and desktop devices and using mobile and desktop operating
systems that it does not control, such as Google Play, iOS App Store and Windows. Anychanges in such mobile and desktop operating systems or devices could potentiallydegrade the functionality of its services or give preferential treatment to competitive
services and result in an adverse effect on the usage of its services. Further, if the numberof platforms for which the Target Group develops its services increases, it will result in an
increase in its costs and expenses. In order to deliver high quality content to a wider
audience, it is important that the Target Group’s platforms work well across a range ofmobile and desktop operating systems, networks, mobile devices, computers andstandards, which the Target Group does not control. The Target Group may not be
successful in developing relationships with key participants in the mobile industry or indeveloping services that operate effectively with these operating systems, networks,
devices and standards. If it is difficult for users, live streamers and V-Livers to access anduse the Target Group’s platforms, particularly on their mobile devices or computers, its

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growth and engagement of users, live streamers and V-Livers could be harmed, and its
business, operational results, financial condition and prospects could be adversely
affected.
The overall network of the Target Group relies on bandwidth connections provided by third
party operators and the Target Group expects this dependence on third parties to continue.
The networks maintained and services provided by such third parties may be subject todamage or interruption, which could impact the Target Group’s business, operational
results, financial condition and prospects. The Target Group also has limited control overthe prices of the services provided by third party operators and may have limited access toalternative networks or services. If the prices for such services rise significantly, the Target
Group’s operational results may be materially and adversely affected.
The services provided by the Target Group may be subject to interruption due tosystem failure or other outages and risks relating to the use of licenced technologies
and opensource software.
Although to the best knowledge of the Target Group, during the Period Under Review and
up to the Latest Practicable Date, there has not been any past instance where the services
provided by the Target Group were subject to interruption, resulting in a material adverse
impact to the Target Group’s operations and/or financials, and the Target Group seeks to
reduce the possibility of disruptions or other outages, its services may be disrupted byproblems with its own technology and system, such as malfunctions in its software or otherfacilities and network overload. The Target Group’s systems may be subject to damage orinterruption from telecommunication failures, power loss, computer attacks or viruses andsimilar events. Parts of its system are not fully redundant, and its disaster recovery planning
may not be adequate for all eventualities. Any interruption in the ability of the Target Group’s
users, live streamers and V-Livers to use its products and services could reduce its future
revenues, harm its future profits, and subject it to regulatory scrutiny and lead users, live
streamers and V-Livers to seek out competing platforms or alternative forms of online social
interactions.
The Target Group relies on certain licenced technologies in some of its products andservices. For instance, in 2023, the Target Group integrated the Live2D functions in its
V-Liver broadcasting functionality, which have been licenced by a third party provider. The
Target Group’s licensing agreements with third party providers are generally one year. The
material licensing agreements entered into by the Target Group with the third party
technology providers which are currently in effect will expire in 2025, and the Target Groupwill generally commence the negotiation process for renewal of such agreements two to
three months prior to the respective expiry date. None of the material licensing agreements
contains a unilateral termination for convenience provision. As at the date of the Circular,
the Target Group does not foresee any particular difficulties in the renewal of its material
licensing agreements. If the Target Group fails to renew any of its licensing agreements withthird party providers upon the expiry of the agreements, certain features or functions on theTarget Group’s platforms may become unavailable, thereby materially and adversely
affecting the business performance of the Target Group.
The Target Group also uses open source software in its business operations and willcontinue to use open source software in the future. There is a risk that open source software
licences could be construed in a manner that imposes unanticipated conditions or
restrictions on the Target Group’s ability to provide or distribute its products or services.
Additionally, the Target Group may face claims from third parties claiming ownership of, or
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demanding release of, the open source software or derivative works that the Target Groupdeveloped using such software. These claims could result in litigation and could require theTarget Group to make its software source code freely available, purchase a costly licenceor cease offering the implicated products or services unless and until the Target Group canre-engineer them to avoid infringement. This re-engineering process could requiresignificant additional R&D resources, and the Target Group may not be able to complete it
successfully.
The Target Group may not be able to successfully halt the operations of spammer ormalicious platforms, which could negatively affect user experience and its
reputation, lure away users, live streamers, V-Livers, merchants or in-app gamedevelopers and reduce its market share and materially and adversely affect its
business, operational results, financial condition and prospects.
Although the Target Group uses technological and legal measures in an attempt to halt theoperations of spammer or malicious platforms, it may not be able to detect all suchplatforms or applications in a timely manner and, even if it could, such measures may beinsufficient to stop these breaches. In these cases, the protective measures used by theTarget Group may not be adequate to protect itself against such platforms or applications.
Regardless of whether the Target Group can successfully enforce its rights against theseplatforms or applications, any measures that it may take could require significant financial
or other resources. These platforms or applications may also lure away some of the Target
Group’s live streamers, V-Livers, users, merchants or game developers, and accordingly
reduce its market share, causing material and adverse effects on its business, operational
results, financial condition and prospects.
Any disruptions or failure in mobile telecommunications or internet services may
have a material and adverse impact on the Target Group’s business and operational
results.
The Target Group depends on the ability of its live streamers, V-Livers, users andmerchants to access mobile telecommunications services and the internet. Currently, thisaccess is provided by companies that have significant market power in the mobile,
broadband and/or internet access marketplaces, including incumbent mobile
telecommunications companies, telephone companies, cable companies, governmentowned service providers, device manufacturers and operating system providers, any ofwhom could take actions that degrade, disrupt or increase the cost of access to the Target
Group’s products or services, which would, in turn, negatively impact its business. The
adoption of any laws or regulations that adversely affect the growth, popularity or use ofmobile devices or the internet or disruption of the Target Group’s services in important
markets for any political or other non-technical reasons could decrease the demand for, or
the usage of, its products and services, increase its cost of doing business and adversely
affect its business, operational results, financial condition and prospects.
The Target Group also relies on telecommunication service providers to maintain reliablenetwork systems that provide adequate speed, data capacity and security to its platforms,
users, live streamers and V-Livers, and internet data centres to host its servers. With the
expansion of its business, the Target Group may be required to purchase more bandwidthand upgrade its infrastructure to keep up with increasing traffic on its platforms. There is no
assurance that such telecommunications providers would be able to accommodate all of its
requests for more bandwidth or upgraded infrastructure, accommodate its requests on
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continued growth in the Target’s internet usage. Any interruption in, or failure of, theoperations of mobile telecommunications or internet infrastructure services that its
platforms, users, live streamers and V-Livers rely on, even for a short period of time, could
undermine its operations, and the Target Group’s business, operational results, financial
condition and prospects could be adversely affected.
Any compromise to the cyber security of the Target Group’s platforms could
materially and adversely affect its business, reputation and operational results.
The Target Group’s products and services are provided through the internet and involve thestorage and transmission of content. Any security breach would expose the Target Groupto a risk of loss of information and result in litigation and potential liability. Although to thebest knowledge of the Target Group, during the Period Under Review and up to the Latest
Practicable Date, there has not been any past instance where the cyber security of theTarget Group’s platforms was compromised, resulting in a material adverse impact to theTarget Group’s operations and/or financials, as the techniques used to obtain unauthorised
access, disable or degrade internet services or sabotage operating systems change
frequently and are often not recognised in a timely manner, the Target Group may not beable to react immediately to such attacks or implement adequate preventative measures.
The Target Group experiences cyber-attacks of varying degrees on a regular basis,including hacking of its user, live streamer and V-Liver accounts and a redirection of its
user, live streamer and V-Liver traffic to other websites, and it has generally been able toidentify the source of the cyber-attacks, mitigate the impact and prevent future occurrences
without a material impact on its operations.
Despite the security measures the Target Group has implemented, its facilities, systems
and procedures and those of third party providers may be subject to security breaches, actsof vandalism, software viruses, misplaced or lost data, programming or human errors orother similar events which may disrupt its delivery of services or expose the confidential
information of its users, live streamers, V-Livers and others. If an actual or perceived breachof its security occurs, the market perception of the effectiveness of the Target Group’s
security measures could be harmed, it may lose existing users, live streamers and V-Livers
and may be exposed to legal and financial risks, including legal claims, regulatory fines andpenalties, which in turn could adversely affect its business, reputation and operational
results.
The Target Group depends on third party online payment systems to conducttransactions. Security breaches or a system interruption of these online payment
systems could materially affect consumer confidence and user experience.
The Target Group depends on the third party online payment systems to process payments
for its products and services. The secure transmission of confidential information, such asusers’ credit card numbers and personal information, through the online payment platforms
is essential to maintaining consumer confidence.
The Target Group does not have control over the security measures of its third party online
payment vendors, and security breaches of these online payment systems could cause
users to lose confidence in the Target Group’s platforms. It could also expose the Target
Group to litigation and possible liability for failing to secure confidential user informationand could, among other things, damage its reputation. If a well-publicised internet or mobile
network security breach were to occur, users concerned about the security of their online
financial transactions may become reluctant to purchase the Target Group’s virtual points
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even if the publicised breach was not a direct result of the actions of the Target Group. In
addition, there may be billing software errors that would damage user confidence in these
online payment systems. For example, during the Period Under Review, one of the Target
Group’s third party online payment service providers experienced billing software errors
and mistakenly informed the Target Group of successful payments even though thetransactions had failed, resulting in the Target Group issuing virtual points which were notpaid for. The Target Group initiated a legal proceeding against the third party online
payment service provider to claim approximately NTD13 million in damages, being theamount the Target Group should have received. As of the Latest Practicable Date, no loss
has been recognised by the Target Group as the proceeding is still ongoing. Other than the
aforementioned software error, to the best knowledge of the Target Group, during the
Period Under Review and up to the Latest Practicable Date, there has not been any past
instance of (i) security breaches or billing software errors of the third party online payment
systems; or (ii) service interruptions or increased costs associated with the third party
online payment systems, in each case resulting in a material adverse impact to the Target
Group’s operations and/or financials. However, if any material security breach or software
error were to occur and damage the perceived security of the online payment systems, theTarget Group may lose paying users who may be discouraged from or stop purchasing thevirtual points, which may have an adverse effect on the Target Group’s business.
In addition, given that the Target Group relies on a limited number of third party payment
systems, any significant increase in the processing fees of these vendors, or a failure bysuch vendors to provide their services may result in a termination of their services with theTarget Group, and accordingly, the Target Group could suffer service interruptions andincreased costs, any of which may have a material adverse effect on its business,
operational results, financial condition and prospects.
The Target Group’s focus on user experience and satisfaction and acting in thelong-term interests of its stakeholders may conflict with the short-term operational
results of its business, and also negatively impact its relationships with merchantsor other business partners.
The Target Group believes that prioritising its user experience and satisfaction is essential
to its success and serves the best, long-term interests of its stakeholders. Therefore, it has
made, and may continue to make, significant investments or changes in strategy that it
believes will benefit its users, even if the decision negatively impacts its operational resultsin the short-term. For example, the Target Group currently does not place significant
advertising on its platforms so that its users can enjoy uninterrupted entertainment on its
platforms. While this decision may limit the Target Group’s revenues in the short term, it
provides a higher quality user experience on its platforms, which it believes will help it
enhance user loyalty and create better monetising potential in the long term. Thisphilosophy of putting the users first may negatively impact its relationship with merchantsor other business partners, in which case its business, financial condition, operational
results and prospects may be adversely affected.
The continuing and collaborative efforts of the Target Group’s management and key
employees are important to its success.
The Target Group depends on the continued contributions of the Target Group’s
management, especially the executive officers listed in Section 24.4 titled “Proposed
Directors and Executive Officers of the Enlarged Group – Proposed Executive Officers” ofthis Circular, and other key employees. Although the Target Group has adopted various
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employee incentive schemes in the past to align the interests of executive officers and key
employees with the Target Group, there is no assurance that such key personnel will beable and willing to continue to contribute their services to the Target Group. If any of the key
personnel intends to leave the Target Group, the Target Group may have to replace themand may incur additional costs to recruit, train and retain key personnel. As a result, its
business may be severely disrupted, its operational results, financial condition andprospects may be materially and adversely affected. In addition, competition for talent in
Asia and other parts of the world is intense. The Target Group’s future success is dependent
on its ability to attract a significant number of qualified employees and retain existing key
employees. If the Target Group is unable to do so, its business and growth may bematerially and adversely affected.
Live streamer, V-Liver and user misconduct and misuse of the Target Group’s
platforms and inappropriate or indecent information disseminated on the platforms
may adversely impact the brand image of the Target Group, affecting its business andsubjecting it to liabilities.
The Target Group operates live social entertainment platforms that provide real-timestreaming and interactions between its users, live streamers and V-Livers. Although theTarget Group has put in place community guidelines and user, live streamer and V-Liveragreements, which users, live streamers and V-Livers are required to adhere to when using
its platforms, the Target Group does not have full control over the content that users, live
streamers and V-Livers generate on its platforms which is unscripted and not pre-vetted,
and the way in which they interact with each other online using its platforms or offline
outside of the supervised events organised by the Target Group. Furthermore,inappropriate representation made by third parties such as celebrities and key opinion
leaders who collaborate with the Target Group in marketing initiatives may negatively affect
the Target Group’s reputation. While the views of third parties are not representative of theTarget Group, the general public may associate such views with the Target Group given thatthe representation was made on the Target Group’s platforms. As the Target Group has
limited control over real-time and offline behaviours of its users, live streamers andV-Livers, to the extent such behaviours are associated with its platforms, its ability toprotect its brand image and reputation may be limited.
The Target Group has implemented processes to detect spam accounts on a daily basis
through which inappropriate or indecent content could be posted and fraudulent or illegal
activities may be conducted. Although the Target Group has SkyEye, a dedicatedmonitoring team, which is aided by proprietary software consisting of AI models developed
in-house, to identify, and take immediate action against, any inappropriate or indecent
content, or fraudulent or illegal activities, and to block accounts or comments during live
streaming sessions, such measures may not be successful in filtering all inappropriate orindecent content or catching all fraudulent or illegal activities. The Target Group had
previously suffered negative publicity involving its brands and platforms, and its application
was removed from iOS App Store and Google Play because of certain live streamers’
violations of the app store policies for approximately two months from October to November
2015. The Target Group immediately took corrective action and none of its applications has
been removed from either of these distribution platforms since then.
In addition, the Target Group has experienced and may continue to experience
manipulation of the popularity indicators on its live streaming platforms by live streamers
and V-Livers who either secretly fund their fans’ gift-giving or through self-gifting via
separate accounts to falsely increase their popularity indicators. While better popularity
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indicators will not automatically result in higher revenue share or higher performancebonuses as those percentages are pre-agreed in the contracts, better popularity indicators
will help the live streamers or V-Livers achieve higher ranking on 17LIVE which will likely
help attract a larger base of audience to their streams. Such an abuse of the system andany perception of abuse may harm the credibility of the popularity indicators and ultimately
the reputation of the Target Group’s platforms. The Target Group’s business and the public
perception of its brands may be materially and adversely affected by the misuse of its
platforms.
If any of its users, live streamers and V-Livers suffers or is alleged to have suffered
physical, financial or emotional harm following contact initiated with other parties on its
platforms, the Target Group may face civil or criminal lawsuits or other liabilities initiated by
the affected individual, or by governmental or regulatory bodies. If the Target Group isdeemed to have facilitated the posting of inappropriate content placed by third parties on its
platforms, or the conduct of fraudulent or illegal activities by third parties using its platforms,
it may be subject to fines or other disciplinary actions, including, in serious cases,
restrictions on some of the features and services provided on its platforms. As a result, its
business may suffer and its reputation, user, live streamer and V-Liver base, revenues andprofitability may be materially and adversely affected.
The Target Group may not be able to prevent fraudulent behaviour by users resulting
in misappropriation of virtual points, which may adversely affect the Target Group’s
revenue-generating opportunities.
Once a user purchases the virtual points, the virtual points are deposited in and attachedto the unique user account, and a user cannot request a refund from the Target Group forthe purchased virtual points, or transfer the virtual points from his/her account to anotheruser’s account. Users can only purchase virtual points directly from the Target Group’s
website or mobile applications, and may make payment through in-app purchases, credit
card gateways and bank-to-bank transfers processed by financial institutions or third party
payment channels, top-up in convenience store, and authorised resellers (only for SEA andIndia) who facilitate payment from users. Therefore, users cannot obtain virtual points fromsecondary platforms. However, the Target Group occasionally experiences fraudulent
behaviour by users resulting in misappropriation of virtual points. These users wouldpurchase the virtual points from the Target Group and make payment through a third party
payment channel. They would then quickly spend the virtual points to redeem virtual gifts
or sell the relevant account to a third party at a discount in breach of the Target Group’s user
conduct rules, before requesting a payment refund from such third party payment channel.
Once a third party payment channel notifies the Target Group that it has made a refund toa user in connection with a purchase of virtual points of 17LIVE, and requests for acorresponding refund from the Target Group, the Target Group will immediately trace thetransaction to identify the relevant account that purchased the virtual points in question.
Depending on the circumstances of each incident (including the amount of virtual points
involved), the Target Group takes appropriate course of actions. If, by analysing the viewing
and gifting history of such account, the Target Group determines that the account has beentransferred, it will be blocked immediately. Furthermore, in all cases, if the virtual points inthe account have not been used to redeem virtual gifts and given to live streamers or
V-Livers, the unspent virtual points will be forfeited. If the virtual points in the account havebeen spent, the Target Group will determine the authenticity of the gifting behaviour. If therelevant gifting is determined by the Target Group to be fraudulent (for example, some live
streamers or V-Livers might attempt to self-gift to increase their popularity indicators tomanipulate the Target Group’s algorithm into ranking them higher on its platforms, and then173

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request refund from third party payment channels), the virtual gifts will be clawed back andthe corresponding revenue will not be attributed to the live streamers or V-Livers. In othercases where the Target Group did not find the gifting to be fraudulent (even though thegifting was made using virtual points obtained by fraudulent means), the virtual gifts will not
be clawed back from the live streamers or V-Livers and the Target Group will bear thelosses and recognise such loss when it recognises the relevant revenue share in respectof the virtual gifts received, because the Target Group is of the view that live streamers andV-Livers who received the virtual gifts should not be penalised if they did not participate in
the users’ fraudulent behaviour. Virtual points that are not clawed back are recognised asrevenue sharing costs (included in cost of revenue) at the end of each month. For the
Period Under Review, (i) the aggregate value of virtual points involved in such fraudulent
behaviour in Japan was approximately JPY137 million, representing approximately 0.12%of the Target Group’s cumulative revenue in Japan for the Period Under Review and (ii) the
aggregate value of virtual points involved in such fraudulent behaviour in Taiwan wasapproximately NTD8.2 million, representing approximately 0.26% of the Target Group’s
cumulative revenue in Taiwan for the Period Under Review.
Policing such fraudulent behaviour is inherently difficult and the preventive measures takenby the Target Group may be inadequate. If user accounts with a substantial amount of
virtual points in deposit are available on the secondary market at a discounted price, theend users may resort to third party platforms instead of purchasing directly from the Target
Group. This may divert sales from the Target Group, affect the Target Group’s reputationand may adversely affect the Target Group’s revenue-generating opportunities, which may
have a material adverse effect on its business, operational results, financial condition andprospects.
The Target Group relies on various third party talent agencies to identify and manage
some of its live streamers and V-Livers. The Target Group may fail to maintain its
relationship with such talent agencies or be subject to fraud or misconduct by suchtalent agencies, and any contractual disputes with the talent agencies or the live
streamers and V-Livers could be costly and time-consuming and may harm the Target
Group’s reputation.
The Target Group enters into both exclusive and non-exclusive live streamer and V-Liver
contracts with a number of its live streamers and V-Livers who produce original content,
either directly with the live streamers and V-Livers or through third party talent agencies
which help the Target Group identify talented live streamers and V-Livers and bring them toits platforms. The Target Group’s standard live streamer and V-Liver contracts provide afixed percentage of revenue sharing with the live streamer and V-Liver without any basesalary and give the Target Group discretion to grant bonuses to the live streamer and
V-Liver if he/she reaches a pre-determined target of streaming hours or receives a certain
amount of virtual gifts. The live streamer and V-Liver contracts also include obligations on
its live streamers and V-Livers to comply with its content protection, confidentiality andother corporate policies.
Some of the Target Group’s live streamers and V-Livers engage in competing business after
the termination of their exclusive live streamer and V-Liver contracts with the Target Group
which may raise legal disputes over the exclusivity and non-compete clauses in theircontracts and the legal proceedings the Target Group takes or may take in response tothese disputes may be expensive, time-consuming and disruptive to its operations. During
the Period Under Review and up to the Latest Practicable Date, the Target Group has only
initiated one legal dispute against a live streamer who breached his/her non-compete
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obligations. On 27 October 2023, the Target Group’s claim against the defendant was
dismissed by the court, but the defendant was ordered to pay the Target Group acompensatory amount of approximately US$20,511 (equivalent to local currency
NT$660,000) plus an interest of 5% per annum from 14 June 2022 until the payment date
for the breach of contract. As of the Latest Practicable Date, the Target Group has notreceived the compensation payment from the live streamer. The outcome of the proceeding
did not materially affect the Target Group’s financials.
While the Target Group generally owns all the original content across multiple media
formats streamed on its platforms, there may be contractual disputes involving live
streamers and V-Livers, third party talent agencies and the Target Group in relation to
intellectual property ownership. Any such disputes between the Target Group and its live
streamers and V-Livers or third party talent agencies, may not only involve lengthy andcostly negotiations and potential litigations, but may also be detrimental to the quality of thecontent produced by its live streamers and V-Livers, deter other live streamers and V-Livers
from signing or continuing to work with the Target Group, decrease user engagement on its
platforms and otherwise adversely affect its business, operational results, financial
condition and prospects.
In addition, the Target Group may be exposed to the risk of fraud or other misconduct by thetalent agencies. Whilst the Target Group has not received any complaints from its live
streamers and V-Livers who have entered into contracts with them in relation to third party
talent agencies conveying false or misleading messages to them (whether in respect of
their use of the Target Group’s platforms or otherwise) during the Period Under Review and
up to the Latest Practicable Date, there is no assurance that the Target Group will not incur
liability for misrepresentation or fraud by third party talent agencies in the future. Any suchclaims could subject the Target Group to costly litigation and result in a significant strain on
its financial resources and divert the attention of the Target Group’s management.
The Target Group’s business is dependent on the strength and market perception ofits brands, and any failure to maintain, protect and enhance the brand would hurt theability to retain or expand the Target Group’s user, live streamer and V-Liver base.
The Target Group markets its live social entertainment services under 17LIVE and Waveand its live commerce services under HandsUp and OrderPally. The business and financial
performance of the Target Group are highly dependent on the strength and the market
perception of its brands and services. The Target Group’s brands and reputation are criticalto increasing its user, live streamer and V-Liver base and, in turn, facilitating its efforts tomonetise its services and enhancing its attractiveness to users, live streamers andV-Livers. From time to time, the Target Group conducts marketing activities across various
media to enhance its brands and to guide public perception of its brands and services. In
order to create and maintain brand awareness and brand loyalty, to influence public
perception and to retain existing and attract new users, live streamers and V-Livers, theTarget Group may need to substantially increase its marketing expenditures. However,there is no assurance that these activities will be successful or that the Target Group will beable to achieve the expected brand promotion effect.
Negative publicity involving the Target Group, its users, live streamers, V-Livers, the Target
Group’s management, platforms or its business model or its industry in general may
materially and adversely harm its brands and its business. There is no assurance that theTarget Group will be able to defuse negative publicity to the satisfaction of its investors,
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facilitate illegal activities such as money laundering may negatively impact its public image.
Such negative publicity, especially when it is directly addressed against the Target Group,
may also require it to engage in defensive media campaigns in order to protect its brand.
This may cause the Target Group to increase its marketing expenses and divert the Target
Group’s management’s attention and may adversely impact its business and operational
results.
To the best knowledge of the Target Group, during the Period Under Review and up to theLatest Practicable Date, there has not been any past instance where the Target Groupfailed to maintain or protect its brands resulting in a material adverse impact to the Target
Group’s operations and/or financials.
Non-compliance on the part of the Target Group’s employees or third parties involved
in its business could adversely affect its business.
The Target Group’s compliance controls, policies and procedures may not be adequate toprotect it from acts committed by its employees, agents, contractors, users, live streamers,
V-Livers collaborators or other business partners that violate the laws or regulations of thejurisdictions in which it operates, which may adversely affect its business. The Target Group
cannot be certain whether any such party has infringed or will infringe on any other parties’
legal rights or violate any regulatory requirements, and cannot rule out the possibility of
incurring liabilities or suffering losses due to any non-compliance by such party. There is no
assurance that the Target Group will be able to identify irregularities or any non-compliancein the business practices of its business partners or other third parties, or that suchirregularities or non-compliance will be corrected in a prompt and proper manner, or at all.
The legal liabilities and regulatory actions on its business partners may also affect theTarget Group’s business activities and reputation, and may in turn affect its operational
results.
Privacy concerns relating to the services of the Target Group and the collection anduse of user, live streamer and V-Liver information could negatively impact the user,
live streamer and V-Liver base or user, live streamer and V-Liver engagement, subject
the Target Group to governmental regulation and other legal obligations, or
negatively affect its reputation.
The Target Group collects profiles, locations and other personal data from its users, live
streamers and V-Livers in order to better understand its users, live streamers and V-Livers
and their needs. Concerns about the collection, use, disclosure or security of personal
information or chat history or other privacy-related matters, even if unfounded, could
damage the Target Group’s reputation, cause it to lose users, live streamers and V-Livers
and subject it to regulatory investigation, all of which may adversely affect its business.
While the Target Group strives to comply with all applicable data protection laws andregulations, as well as its privacy policies pursuant to its terms of use and other obligations
it may have with respect to privacy and data protection, any failure or perceived failure tocomply with these laws, regulations or policies may result in enquiries and otherproceedings or actions against the Target Group by government bodies or others, as well
as negative publicity and damage to its reputation and brands, each of which could cause
the Target Group to lose users, live streamers and V-Livers and have an adverse effect on
its business and operational results.

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LETTER TO SHAREHOLDERSThe Target Group has policies and measures in place to address such privacy concerns. In
particular, the Target Group has implemented data security measures such as
categorisation of personal data, anonymisation of personal data, restricted access todatabases and secured backup mechanism. The Target Group anonymises personal dataand only stores summarised metrics in its centralized, encrypted database. The
anonymised information is subject to strict permission control access and only granted tocertain authorised accounts, with an audit log to record all access log for future analysis.
To further prevent leakages of personal information, the Target Group also prohibits any
personnel from sharing any personal information outside the group. While the Target Group
expects to continue expending significant resources to protect against security breaches,
any actual or perceived systems failure or compromise of the Target Group’s security that
results in the unauthorised access to or release of the data or chat history of its users, live
streamers and V-Livers could significantly reduce its users’, live streamers’ and V-Livers’
willingness to use its services, as well as harm its reputation and brands.
The Target Group may not be able to adequately protect its intellectual property,
which could cause it to be less competitive and third party infringements of its
intellectual property rights may adversely affect its business.
The Target Group relies on a combination of copyright and trademark laws and restrictions
on disclosure to protect its intellectual property, including its proprietary V-Livers. Pleaserefer to Section 14.14 titled “Information on the Target Company – Intellectual Property” ofthis Circular for further details. Despite its efforts to protect its proprietary rights, third
parties may attempt to copy or otherwise obtain and use its intellectual property or seek
court declarations that there has not been any infringement of the Target Group’s
intellectual property. Although to the best knowledge of the Target Group, during the Period
Under Review and up to the Latest Practicable Date, there has not been any past instance
where the Target Group did not adequately protect its intellectual property, resulting in amaterial adverse impact to the Target Group’s operations and/or financials, monitoring
unauthorised use of its intellectual property is difficult and costly, and the Target Group
cannot be certain that the steps it has taken or will take will adequately prevent themisappropriation of its intellectual property. From time to time, the Target Group may haveto resort to litigation to enforce its intellectual property rights, which could result in
substantial costs and diversion of its resources.
Competitors and other third parties may register trademarks or purchase internet searchengine keywords or domain names that are similar to those of the Target Group in order todivert potential users, live streamers and V-Livers from the Target Group’s platforms totheirs. Preventing such unauthorised use is inherently difficult. If the Target Group is unable
to prevent such unauthorised use, potential users, live streamers and V-Livers may be
driven away from its platforms to competing, irrelevant or potentially offensive platforms,
which could harm the Target Group’s reputation and cause material and adverse effects to
its business, operational results, financial condition and prospects. There have been
instances where third parties have cloned and launched applications that have similar lookor similar looking names compared to the Target Group’s mobile applications. Some ofthese counterfeits were inadvertently installed by users. These counterfeit mobile
applications may mislead users and negatively affect their perception of the Target Group’s
platforms. The Target Group may have to expend substantial resources in connection withlegal proceedings or other protective measures to curb these counterfeit activities in orderto protect its intellectual property, user experience and brand perception.

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LETTER TO SHAREHOLDERSThe Target Group may be subject to intellectual property infringement claims or otherallegations by third parties for information or content displayed on, retrieved from orlinked to its platforms, or distributed to its users, or for proprietary information
appropriated by former employees, which may materially and adversely affect its
business, financial condition and prospects.
The Target Group does not have full control over how and what its live streamers andV-Livers will share, display on or link to its platforms. As a large portion of its content isgenerated by live streamers and V-Livers who can be any person registered on its
platforms, the Target Group does not have the capacity or resources to verify the originalityof each content uploaded to its platforms. Although those allegations arise out of individual
behaviours, platforms as service providers are often sued or investigated for any potential
liabilities or misbehaviours. Although to the best knowledge of the Target Group, during the
Period Under Review and up to the Latest Practicable Date, the Target Group was not
subject to any intellectual property infringement claims brought by third parties for services
it provides or for content displayed on, retrieved from, linked to, recorded, stored or madeaccessible on its platform, the Target group may be subject to intellectual property
infringement claims in the future, which may materially and adversely affect its business,financial conditions and prospects. In addition, there is no assurance that other aspects of
the Target Group’s operations do not or will not infringe upon or violate intellectual property
rights (including but not limited to trademarks, patents, copyrights, know-how) or otherrights (including but not limited to portraiture right) owned or held by third parties. The
Target Group may be involved in litigation based on allegations of infringement ofintellectual property, unfair competition, invasion of privacy, defamation and other violationsof other parties’ rights. For instance, there may be allegations that some in-app gamecontent of the Target Group (whether developed in-house or by third party gamedevelopers) has infringed the copyright in works of literature and art of other gameproducers, thereby harming the reputation of the Target Group. In addition, the regulatory
regimes on the protection of intellectual property rights in internet-related industries,
especially in the evolving live social entertainment industry, are uncertain and still evolving.
Defending any such actions could be costly and require significant time and attention of theTarget Group’s management and other resources, and may cause damages to its
reputation, which would materially and adversely affect its business.
The Target Group has adopted systematic methods to reduce its exposure to the risks ofintellectual property infringement claims. Under its agreements with live streamers andV-Livers, the Target Group is the owner of the intellectual property arising out of live
streaming activities on its platforms. When the live streamers and V-Livers register on its
platforms, they agree to its standard agreement, which includes a clause providing that theyshall not disseminate any content infringing on a third party’s copyright. Once a complaintof alleged intellectual property infringement is reported to the Target Group, an investigationis commenced by the Target Group and any infringing content is deleted as appropriate ina timely manner. However, it is challenging for the Target Group to accurately identify andverify such content in each case, and there is no assurance those methods are sufficient toshield the Target Group from third party liabilities for intellectual property infringement, orthat its efforts will be considered favourably by a given court or relevant governmental
authority. Liabilities for intellectual property infringement, or allegations of such
infringement, may lead to unfavourable media coverage and damage to its reputation, oreven cause governmental authorities to impose sanctions and financial penalties on theTarget Group, including, in certain cases, a suspension of the Target Group’s business
operations, which may materially and adversely affect its business, financial condition andprospects.
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LETTER TO SHAREHOLDERSThe Target Group’s patents for its technologies may expire and may not be extended,
its patent applications may not be granted and its patent rights may be contested,circumvented, invalidated or limited in scope.
The operation and success of the Target Group’s services and its business are affected by
its ability to obtain patents and other intellectual property rights and adequate legal
protection for its technologies in Japan, Taiwan and other jurisdictions, such as patents
relating to “frame image of a group call”, “recommendation using machine learning in live
streaming”, “gifting during live streaming”, “rejoining during live streaming after network
disconnection”, “tipping gift for in-app games” and “S+ latency technology”. The Target
Group relies on a combination of patent, copyright, service mark, and trade secret laws, aswell as confidentiality procedures and contractual obligations, to establish and protect its
proprietary rights, all of which provide only limited protection. The Target Group has
implemented various internal policies and rules such as the “Trade Secret Management
Rule” to protect its trade secrets, such as its S+ latency technology and details of its top
spenders. The “Trade Secret Management Rule” classifies internal information into threelevels with different intensity of protection measures, and trade secrets are classified as thehighest level, which requires (1) personnel access control, (2) mark “Confidential” to theinformation, (3) password set up and (4) enhance the management of trade secret byapproval process with confidentiality agreement signed by external parties. The Target
Group has also built its information security policy with mechanisms in its IT infrastructure,by which the IT teams can swiftly monitor and suspend any abnormal communication inorder to prevent any leakage of trade secrets. There is no assurance that the Target Group’s
pending patent applications will be approved, which is required to ensure that the Target
Group is adequately protected and to provide the Target Group with a competitive
advantage, or that any of the Target Group’s patents will not be challenged, invalidated or
circumvented. The Target Group has filed for patents in Japan, Taiwan and otherjurisdictions, but such protection may not be available in all countries and regions in which
the Target Group operates and accordingly the Target Group may not be able to enforce its
intellectual property rights. Such patents will also expire in the future. In addition, the patentapplications made by the Target Group may be rejected. For example, in 2022, one
registered patent in Taiwan of the Target Group was invalidated by the Taiwan Supreme
Court although the Target Group believes that the invalidation did not have any effect on thebusiness of the Target Group.
The Target Group’s live streaming platforms which enable its users to purchase thevirtual points to play online in-app games on its platforms may be adversely affectedby changes to the regulation of gambling and gambling related activities underapplicable laws.
The laws and regulations governing online games and games of chance for a prize injurisdictions in which the Target Group operates and offers its in-app games are developing
and evolving, and are subject to changes. For instance, given that the promotion of theTarget Group’s platforms is a form of inducement pursuant to the Act against Unjustifiable
Premiums and Misleading Representations of Japan, the offering of virtual points on theTarget Group’s platforms may be subject to certain limitations relating to the value, kinds
and means of offering. There is no assurance that changes in applicable laws will not havea material adverse effect on its operations in future periods.

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LETTER TO SHAREHOLDERSThe Target Group is subject to regulations restricting gambling in jurisdictions in which it
operates. Any non-compliance with the applicable laws and regulations (as amended fromtime to time) could subject the Target Group to administrative fines and sanctions imposedby the competent authorities, and in turn adversely affect its reputation, business,
operational results, financial condition and prospects. Please refer to Appendix G titled“Government Regulations – Japan – Act against Unjustifiable Premiums and Misleading
Representations of Japan and – Taiwan – Criminal Code of Taiwan” of this Circular for
further details.
The Target Group relies on assumptions and estimates to calculate certain key
operating metrics, and real or perceived inaccuracies in such metrics may harm its
reputation and negatively affect its business.
All of the key operating metrics such as the MAUs and number of paying users of the Target
Group’s various applications are calculated using internal company data collated by theTarget Group. These key operating metrics have not been independently verified. Whilethese numbers are based on what the Target Group believes to be reasonable calculations
in line with market standards for such applicable periods, there are inherent challenges inmeasuring usage and user engagement across its large user base. For example, the Target
Group treats each account as a separate user for the purposes of calculating its MAUs andpaying users, because it may not always be possible to identify users that have set up morethan one account. In reality, a single user may register multiple accounts across the Target
Group’s platforms. Therefore, the calculations of its MAUs and paying users may notaccurately reflect the actual number of people using its applications.
The measures of the growth and engagement metrics of users, live streamers and V-Liversof the Target Group may differ from estimates published by third parties or from similarly
titled metrics used by its competitors due to differences in calculation methodology. If users,
live streamers and V-Livers do not perceive the performance metrics adopted by the Target
Group to be accurate representations of its user, live streamer and V-Liver base orengagement level, or if the Target Group discovers material inaccuracies in its performance
metrics, its reputation may be negatively affected and users, live streamers and V-Livers
may be less willing to allocate their time or spending to its platforms, which could negatively
affect its business, operational results, financial condition and prospects.
Part of the revenues of the Target Group are recognised on a deferred basis, and it
cannot be certain when such revenues will be recognised in its financial statements.
Changes in cash flow generated from the Target Group’s businesses may not always matchits revenue trends due to its revenue recognition policy, under which proceeds from its salesof virtual points to its users are booked as deferred revenues and are only recognised whenthe virtual points are used by the users to purchase virtual gifts and given to the live
streamers and V-Livers on its platforms. To determine the revenue to be recognised fromthe sale of a virtual point, the Target Group utilises an internal system to individually track
the value of each virtual point purchased by users from the Target Group (regardless of thepayment channel used by users to make the payment). Each virtual point held by a user in
his/her account carries a distinct value in the system, and revenue is recognised when thevirtual points are spent on a First-In-First-Out (FIFO) basis, i.e. virtual points purchased
earlier are deemed to be spent first and therefore the relevant revenue is recognised first.
Any virtual points purchased by a user in Japan and not used will expire after a year andthe revenues from these virtual points will be recognised by the Target Group at such time.
To the extent that virtual points are purchased by users in one jurisdiction and used toredeem virtual gifts which are given to live streamers or V-Livers in another jurisdiction, the180

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Target Group allocates the revenue based on location of live streamers or V-Livers who
receive the virtual gifts. The operating entity for the jurisdiction where the virtual points arepurchased records the amount represented by the virtual points spent to redeem the virtual
gifts as payables to the operating entity for the jurisdiction where the live streamers or
V-Livers who receive the virtual gifts are based. On the other hand, the latter entity records
the same amount as receivables from the former entity. These receivables and payables areoffset with each other in the consolidated financial statements of the Target Group.
Since the Target Group does not know in advance precisely when its users give the virtual
gifts to the live streamers and V-Livers on its platforms, it is difficult for the Target Group toaccurately predict its revenues and cash flow. Accordingly, the quarter-to-quartercomparisons of the operational results of the Target Group included elsewhere in thisCircular may not be indicative of its future performance. Moreover, a decline in its sales ofvirtual points in any one quarter may not be immediately reflected in its revenue results forthat quarter. Such a decline, however, may negatively affect its revenue in future quarters.
Accordingly, the effect of significant downturns in sales and market acceptance of its virtual
points and virtual gifts, and potential changes in the number of its active paying users may
not be fully reflected in its operational results until future periods. Its revenue recognition
policy also makes it more difficult for the Target Group to rapidly increase its revenue
through additional sales in any period, as revenue from its paying users is only recognised
when its paying users use their virtual points to purchase virtual gifts and give to the live
streamers and V-Livers, which may occur in subsequent periods.
The Target Group’s operational results are subject to fluctuations due to seasonality.
The revenue streams of the Target Group are subject to seasonality and other fluctuationsin its business. Factors that may contribute to the fluctuations of its revenue and periodic
results include (i) seasonal promotional and marketing activities, such as online
competitions and offline events; (ii) fluctuations in overall consumer demand for online live
entertainment services during certain months and holidays; (iii) timing of promotional andmarketing activities; and (iv) macro-economic and local economic conditions, and theireffect on discretionary consumer spending. Furthermore, the Target Group does not know
in advance when its users will utilise their virtual points to purchase virtual gifts on its
platforms. As a result and taking into consideration the short operating history of some ofits products, it may be difficult for the Target Group to accurately identify recurring seasonal
trends in its business. Accordingly, the period-to-period comparisons of the operational
results of the Target Group included elsewhere in this Circular may not be indicative of its
future performance and the Target Group’s operating results in future quarters or years may
fall below the expectations of securities analysts and investors.
Fluctuations in foreign currency exchange rates in countries and areas where theTarget Group operates its business will affect its financial results, which it reports in
U.S. Dollars.
The Target Group operates in multiple jurisdictions, which exposes it to the effects offluctuations in currency exchange rates. The Target Group earns revenue denominated inJapanese Yen, New Taiwan Dollars, U.S. Dollars, Hong Kong Dollars, and Singapore
Dollars, among other currencies. The Target Group incurs expenses for employeecompensation and other operating expenses in the local currencies in the jurisdictions inwhich it operates, including the jurisdictions described above. Fluctuations in the exchange
rates between the various currencies that the Target Group uses could result in expenses
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stable. There is no assurance that fluctuations in foreign currency exchange rates will nothave a material adverse effect on its operational results in future periods. The Target Group
does not generally enter into hedging contracts to limit its exposure to fluctuations in thevalue of the currencies that its businesses use. Furthermore, the substantial majority of its
revenue is denominated in the currencies in the markets in which the Target Group operates
and is different from its reporting currency in U.S. Dollars. Because fluctuations in the valueof such currencies are not necessarily correlated, there can be no assurance that theoperational results of the Target Group will not be adversely affected by such volatility inexchange rates.
The Target Group is subject to risks relating to liabilities relating to subsidiaries thatit has liquidated, dissolved or otherwise wound up prior to the Completion of the
Proposed Business Combination.
The Target Group may liquidate, dissolve or otherwise wind up certain subsidiaries prior to
the Completion of the Proposed Business Combination, as a result of strategic
re-positioning of its business or internal group restructuring. Such subsidiaries may besubject to claims, allegations or lawsuits, government investigations, and otherproceedings, as well as liabilities as a result of their violation of laws and regulations. If theTarget Group is held liable for the liabilities of such subsidiaries, the Target Group’sbusiness, operational results, financial condition and prospects could be materially andadversely affected.
If the Target Group’s goodwill or intangible assets become impaired, it may berequired to record a significant charge to earnings.
The Target Group reviews its intangible assets for impairment when events or changes incircumstances indicate that the carrying value may not be recoverable, such as a decline
in share price and market capitalisation. The Target Group tests goodwill for impairment atleast once a year. If such goodwill or intangible assets are deemed to be impaired, an
impairment loss equal to the amount by which the carrying amount exceeds the fair valueof the assets would be recognised. The Target Group may be required to record a significant
charge in its financial statements during the period in which any impairment of goodwill or
intangible assets is determined, which would negatively affect the operational results.
The Target Group is or may be subject to risks associated with strategic partnerships
or acquisitions.
As in the past, the Target Group continues to look for opportunities to invest in, partner withor acquire other businesses that it believes will strengthen its operations in areas such as
in-app games and short form videos, among others. However, the Target Group may fail toselect appropriate acquisition targets, negotiate acceptable arrangements (including
arrangements to finance acquisitions) or integrate the acquired businesses and theirpersonnel into its own. Furthermore, even if the Target Group identifies a target, there canbe no assurance that such an acquisition may be completed. This may impede its future
expansion plans and result in a waste of its resources.
If these investments and acquisitions do not perform as well or are not as profitable as
anticipated, do not bring about the synergies to its business as anticipated, or if theindustry, regulatory or economic environments deteriorate, they could result in significant
impairment of goodwill, intangible assets and investments. Moreover, acquisitions ofbusinesses and assets may result in an increase in capital expenditure and other expenses
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in integrating new businesses and personnel into its own, require significant management
attention and result in a diversion of resources away from its existing business, which inturn could have an adverse effect on its business operations. Further, acquisitions could
result in increased leverage, potentially dilutive issuances of equity securities and exposure
to potential unknown liabilities of the acquired business. The costs of identifying andconsummating acquisitions may also be significant. In addition to possible shareholders’approval, the Target Group may also have to obtain approvals and licences from relevant
government authorities for the acquisitions and comply with applicable laws andregulations, which could result in increased costs and delays. In addition, strategic
partnerships could subject the Target Group to a number of risks, including risks associatedwith sharing proprietary information and non-performance by third parties. The Target
Group may not be able to monitor or control the actions of its strategic partners and, to theextent any such strategic partner suffers negative publicity or harm to its reputation fromevents relating to its own business, the Target Group may also suffer negative publicity or
harm to its reputation by association.
The Target Group is subject to risks relating to litigation, which could adversely
affect its business, operational results, financial condition and prospects.
The Target Group has been, and may become, subject to claims, allegations or lawsuits,
government investigations, and other proceedings brought by its competitors, users, live
streamers, V-Livers, business partners, employees, short sellers, investment researchfirms or other individuals or entities relating to intellectual property, consumer protection,
privacy, labour and employment, unfair competition, securities, tax, marketing andcommunications practices, commercial disputes, breach of contract or other matters. Anysuch allegations or lawsuits, with or without merit, or any perceived unfair, unethical,
fraudulent or inappropriate business practice by the Target Group or perceived
malfeasance by the Target Group’s management could harm its reputation and user, live
streamer and V-Liver base and significantly divert the attention of the Target Group’s
management from the daily operations. The Target Group will also need to incur additionalcosts to manage and defend litigation and related indemnity. The Target Group may berequired to pay damages or settle litigation claims, all of which could have a material
adverse impact on the Target Group’s business and operational results.
In addition, the Target Group’s live streamers and V-Livers may be the subject of litigation.
For instance, the Target Group’s live streamers and V-Livers may be involved in contractual
disputes over their non-compete obligations with their former platforms. Although suchallegations or lawsuits will not subject the Target Group to liability or compensation and theTarget Group is not liable to indemnify the live streamers and V-Livers for their obligations
owed to their former platforms, these allegations or lawsuits may generate negative
publicity that significantly harms the reputation of the Target Group, which may in turnmaterially and adversely affect the Target Group’s user base and ability to attract users.
To the best knowledge of the Target Group, during the Period Under Review and up to theLatest Practicable Date, there has not been any past instance where (i) the Target Groupwas subject to any claims, allegations or lawsuits, government investigations, and otherproceedings brought by its competitors, users, live streamers, V-Livers, business partners,
employees, short sellers, investment research firms or other individuals or entities relating
to intellectual property, consumer protection, privacy, labour and employment, unfair
competition, securities, tax, marketing and communications practices, commercial
disputes, breach of contract or other matters; or (ii) Target Group’s reputation was harmed

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as a result of its live streamers or V-Livers being subject to allegations or lawsuits, in eachcase resulting in a material adverse impact to the Target Group’s operations and/or
financials.
The Target Group is subject to anti-corruption, anti-bribery and other laws andregulations, and the third party payment channels that the Target Group cooperates
with are subject to anti-money laundering laws and regulations.
The Target Group is subject to anti-corruption, anti-bribery and other relevant laws andregulations in the markets it operates. The third party payment channels that the Target
Group cooperates with are subject to anti-money laundering laws and regulations. Pleaserefer to Appendix G titled “Government Regulations – Japan – Act on Prevention of Transfer
of Criminal Proceeds of Japan and – Taiwan – Regulations Governing Anti-Money
Laundering of Financial Institutions of Taiwan” of this Circular for further details.
The Target Group performs compliance processes, maintains internal control systems(which include procedures to prevent money laundering and counter terrorism financing)and organises refresher trainings to its employees to be made aware potential money
laundering activities that may be carried out on its platform. Specifically, in respect of thelive streamers and V-Livers, the Target Group requires all contracted or non-contracted live
streamers and V-Livers who are entitled to revenue sharing to submit their personal details
to the Target Group, including their full name, date of birth, address, official identification
documents and the bank account number. The full name and bank account number have tomatch with the records of the recipient financial institution before the payment can go
through. For Taiwan, the Target Group assists to submit to the tax authorities such payment
information for the filing of income tax purpose and for Japan, the Target Group annuallyprovides tax authorities with the individual name, address, payment amount andwithholding tax for all the live streamers and V-Livers who earned more than approximately
USD334.1 (equivalent to local currency JPY50,000) for the year. In addition, for Japan, thenames of live streamers and V-Livers are passed through an “anti-social check”, such term
being a euphemism in Japan for organised crime which is considered a serious threat tobusinesses. In respect of the users, the Target Group requires them to provide their email
address and/or mobile phone number at the initial setting-up of his/her account on the
17LIVE application, and anti-money laundering considerations are mitigated in multiple
ways, including (i) the anti-money laundering checks performed by financial institutions andpayment processing platforms processing the payment from users to the Target Group via
credit card payment gateways or direct bank-to-bank transfers, which constitute more than
99.8% of the total revenue of the Target Group in FY2020 to FY2022; (ii) the no-refund
policy (exceptions are made in the very limited circumstances of credit card fraud) and theno-transfer policy (with no exception) adopted by the Target Group. In addition, the revenue
sharing arrangement (where a live streamer or V-Liver will generally only be entitled to lessthan 50% of the initial monetary value of the virtual points paid by the user) does not make
17LIVE an effective platform to conduct money laundering activities.
To the best knowledge of the Target Group, and as of the Latest Practicable Date, there has
not been any breach or alleged breach of anti-corruption, anti-bribery, anti-money
laundering and other laws and regulations that resulted in a material adverse impact on theTarget Group’s financials and/or operations and there were no due diligence findings of any
such breach or alleged breach. Although the Target Group performs compliance processes,
maintains internal control systems (which include procedures to prevent money launderingand counter terrorism financing) and relies on contractual protection, it is exposed to therisk of fraud or other illegal activity committed by its employees, live streamers, V-Livers,
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users or other business partners. For example, it does not generally require real-nameregistration by its users and it may not be able to verify the basic information provided byits users as being true and accurate. If the Target Group fails to detect or prevent any
misconduct or violation of applicable laws, regulations or internal controls by these third
parties, or determines that its compliance processes or internal control systems are notconducted or operated properly, the Target Group could become subject to investigations
and enforcement actions, which may result in penalties, fines and sanctions and in turnadversely affect its reputation, business, operational results, financial condition andprospects. In particular, the Target Group currently engages third party online payment
platforms to process payment for its virtual points. These third party online payment
platforms may also be subject to anti-money laundering obligations under applicableanti-money laundering laws and regulations in jurisdictions where the Target Group
operates its business, including the establishment of a customer identification programme,
the monitoring and reporting of suspicious transactions, the preservation of user
information and transaction records, and the provision of assistance to the public security
department and judicial authority in investigations and proceedings in relation to antimoney laundering matters. Any breach or alleged breach of these anti-money laundering
laws by third party online payment platforms used by the Target Group could harm theTarget Group’s reputation and materially and adversely affect the Target Group’s business,
operational results, financial condition and prospects.
The risk management and internal control systems of the Target Group may not beable to exhaustively assess or mitigate all risks.
The Target Group’s internal control system includes an organisational framework and,policies and procedures that are designed to monitor and control potential risk areas
relevant to its business operations. Although the Target Group’s internal control proceduresare designed to monitor its operations and ensure overall compliance, there is no
assurance that its risk management and internal control systems will be able to identify,
prevent and manage all risks or all non-compliance incidents exhaustively in a timely
manner, and it may not be always possible to detect and prevent every fraud and othermisconduct in a timely manner.
The Target Group’s risk management and internal controls also depend on the effective
implementation of such systems by its employees. Due to the significant size of the Target
Group’s operations, there is no assurance that such implementation will not involve any
human errors or mistakes, which may materially and adversely affect the Target Group’sbusiness and operational results.
As the Target Group is likely to offer a broader and more diverse range of services in the
future, its risk management capabilities are likely to require further enhancement. If theTarget Group fails to timely adapt its risk management policies and procedures to itschanging business, its business, financial condition, operational results and prospects
could be materially and adversely affected.
The Target Group’s insurance may not sufficiently cover, or may not cover at all,losses and liabilities that it may encounter.
The Target Group’s business insurance is limited and it does not maintain businessinterruption insurance to cover its operations. The Target Group has determined that thecosts of insuring for related risks and the difficulties associated with acquiring suchinsurance on commercially reasonable terms make it impractical to have such insurance.
Any uninsured damage to the Target Group’s platforms, technology infrastructures or
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disruption of business operations could require it to incur substantial costs and divert its
resources, which could have an adverse effect on its business, operational results, financial
condition and prospects. Please refer to Section 14.10 titled “Information on the Target
Company – Insurance” of this Circular for further details.
The Target Group faces risks related to natural disasters, health epidemics, acts ofterrorism, acts of war, political transformations and other catastrophes, which could
significantly disrupt its operations.
The Target Group’s business could be adversely affected by any occurrence of force
majeure events, acts of war, terrorist attacks, political unrest, social and economic chaos,natural disasters such as earthquakes, typhoons, nuclear disasters, floods, tsunamis,
snowstorms, sandstorms, droughts and extreme and adverse bad weather conditions in themarkets in which the Target Group operates, which are beyond the control of the Target
Group. Such force majeure events may materially and adversely affect the economy,
infrastructure and livelihood of the users, live streamers and V-Livers, and could materiallyand adversely affect the Target Group’s business, operational results, financial conditionand prospects.
The Target Group’s services rely on the technical infrastructure and other utilities, which
may be subject to damage from natural disasters and other calamities. The Target Group
does not carry insurance to cover damage caused by earthquakes, typhoons or othernatural disasters or any resulting business interruption. It is possible that the Target Groupmay be unable to recover certain data in the event of a server failure. There is no assurance
that any backup systems will be adequate to protect it from the effects of fire, floods,
typhoons, earthquakes, power loss, telecommunications failures, break-ins, wars, riots,
terrorist attacks or similar events. Any of the foregoing events may give rise to serverinterruptions, breakdowns, system failures, technology platform failures or internet failures,
which could cause the loss or corruption of data or malfunctions of software or hardware aswell as adversely affect the Target Group’s ability to provide services on its platforms.
In recent years, there have been outbreaks of epidemics globally such as COVID-19, Ebola
and Zika. The operations of the Target Group could be disrupted if any of its live streamers,
V-Livers or employees were suspected of having any epidemic illnesses, since this could
cause the live streamers and V-Livers to be unable to broadcast and require the Target
Group to quarantine its employees, disinfect the facilities and cancel its offline events,
which could severely disrupt its operations and materially and adversely affect its business,
operational results, financial condition and prospects.
The business, operational results, financial condition and prospects of the Target
Group, as well as its ability to obtain financing, may be adversely affected bydownturns, or perceived downturns, in the global economies or the economies ofcountries and markets it operates in.
Economic conditions in the countries and regions in which the Target Group operates are
sensitive to global economic conditions, as well as changes in domestic economic andpolitical policies. The global macroeconomic environment faces challenges, including theslow recovery from the COVID-19 pandemic, the rising U.S.-PRC and PRC-Taiwan tensions
and the Russia-Ukraine war. Rising political tension between the PRC and the U.S. could
reduce the levels of trade, investment, technological transfers and other economic activities
between the two major economies, which would have a material adverse effect on global
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Middle East, Europe and Africa, which have resulted in volatility in oil and other markets,and over the conflicts involving Ukraine and Syria. For example, the Russia-Ukraine conflictmay continue to intensify, resulting in significant geopolitical tensions in Europe and acrossthe world. There have also been concerns over the relationship among the PRC and otherAsia Pacific countries, which may result in or intensify potential conflicts in relation toterritorial disputes.
Any severe or prolonged slowdown in the global economies or the economies of thecountries and regions in which the Target Group operates may materially and adversely
affect its business, operational results, financial condition and prospects, given that theTarget Group’s products and services may be viewed as discretionary by its users, who may
choose to discontinue or reduce spending on such products and services during an
economic downturn, which would in turn negatively impact its business and operational
results.
In addition, changes in the stability of global financial markets may adversely affect theTarget Group’s ability to access capital markets to meet liquidity needs. The weakness inthe economy could erode investors’ confidence, which constitutes the basis of the credit
market. The recent financial turmoil affecting the financial markets and banking system may
significantly restrict the Target Group’s ability to obtain financing in the capital markets orfrom financial institutions on commercially reasonable terms, or at all.
16.2 Risks relating to Doing Business in Jurisdictions in which the Target Group Operates
The Target Group may be subject to licensing requirements and restrictions on
foreign investment in jurisdictions in which it operates.
During the Period Under Review and up to the Latest Practicable Date, the Target Group
does not require licences and approvals to operate its business. However, one of the Target
Company’s subsidiaries in Japan, Machipopo, has submitted a notification to the Japanese
government that it is an issuer of “prepaid payment instruments for own business” pursuant
to the PSA with respect to the virtual points available on 17LIVE, and is therefore required
to submit a notification within a prescribed time period if the unused balance of the virtual
points issued has exceeded the applicable notification threshold at the end of March or
September each year and is required to make a restricted deposit in the amount equal toat least 50% of the total amount of unused balance of the prepaid payment instruments at
the end of March and September each year, if such total amount is more than JPY10 million.
During the Period Under Review and up to the Latest Practicable Date, the Target Grouphas complied with all applicable requirements under the PSA. On 13 October 2023,
Machipopo transferred its business to 17LIVE Japan, pursuant to which 17LIVE Japan
became the issuer of virtual points on 17LIVE in Japan. 17LIVE Japan is required to, andis prepared to, file a notification under the PSA as the new issuer within one month of thebusiness transfer. As of the date of this Circular, the shareholder of Machipopo hasapproved its dissolution, which is expected to be completed by end of 2023. As of the Latest
Practicable Date, 17LIVE Japan has not filed the notification under the PSA. 17LIVE Japanintends to complete such filing prior to the EGM and Shareholders will be updated on thefiling at the EGM. The business transfer is part of the Target Group’s internal restructuring
to streamline the group structure and improve operational efficiency, and will not affect theTarget Group’s financials and/or business in Japan. If the Target Group fails to comply with
the notification or other applicable requirements under the PSA in the future, Target Group’sbusiness in Japan may be subject to a suspension order for a period of not more than six
months, and the Target Group’s operations and/or financials may be materially and187

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adversely affected. Please refer to Appendix G titled “Government Regulations – Japan –Payment Services Act of Japan” of this Circular for further details.
In addition, under the TBA, 17LIVE Japan submitted a notice to the Minister of Internal
Affairs and Communications of Japan as a telecommunications business operator on
26 November 2020. In the notice, 17LIVE Japan reported its services as “video chatservice” under the category of “internet connection service”. Given that the Target Group
provides text messaging function in the live streaming sessions on its platforms, it may also
be required to report its services as “text chat service” in addition to “video chat service”.
Based on the advice received by 17LIVE Japan from its Japanese legal adviser, the Target
Group believes that even if the wordings “text chat service” were not included in the
notification, it is unlikely that such notification would be regarded as a violation of the TBA.
However, if the Target Group is considered to have violated the TBA and an employee of theTarget Group is prosecuted, its business, reputation and operational results and prospects
could be materially and adversely affected. Please refer to Appendix G titled “Government
Regulations – Japan – Telecommunications Business Act of Japan” of this Circular for
further details.
If any licences and approvals are required for the Target Group to operate its business inthe future, there is no assurance that the Target Group would be able to obtain suchlicences or approvals in a timely manner, or at all, which would subject it to the sanctions
described above or other sanctions as stipulated in the new regulatory rules, and materiallyand adversely affect its business and impede its ability to continue its operations.
The Target Group’s subsidiary in Japan and Taiwan may also be subject to restrictions on
foreign investment and ownership of business. Please refer to Section 16.2 titled “Risk
Factors – Risks relating to Doing Business in Jurisdictions in which the Target GroupOperates – The Target Group may be adversely affected by Taiwan laws and regulations
regarding restrictions on PRC ownership and investment”, Appendix G titled “Government
Regulations – Japan – Foreign Exchange and Foreign Trade Act of Japan” and Appendix G
titled “Government Regulations – Taiwan – Statute for Investment by Foreign Nationals of
Taiwan” of this Circular for further details. During the Period Under Review and up to theLatest Practicable Date, the Target Group is not required to obtain regulatory approvals in
respect of its interests in its subsidiaries in Japan and Taiwan. If the Target Group becomessubject to such requirements in the future and fails to obtain the relevant approvals, theTarget Group’s investments in its subsidiaries in Japan and Taiwan may be restricted andthe Target Group may be subject to a monetary fine or other enforcement actions, which
may adversely affect its reputation, business, operational results, financial condition andprospects.
The Target Group may be adversely affected by Taiwan laws and regulations
regarding restrictions on PRC ownership and investment.
The Target Group may be affected by Taiwan laws and regulations concerning PRC
ownership and investment. The Target Group operates its business in Taiwan through its
Taiwan-incorporated subsidiaries and branch offices, which include 17LIVE Taiwan,
HandsUp, NEI, Wave and NETW, (together, the “Group Taiwanese Entities”). The Target
Group’s Taiwan business accounted for approximately 17.3%, 17.4%, 23.9% and 25.3% of
the revenue for FY2020, FY2021, FY2022 and 1H FY2023, respectively. The Target
Company is required to obtain prior approval from the Department of Investment Review,
Ministry of Economic Affairs of Taiwan (the “Taiwan DIR”) for the Target Company’s
investment in the Group Taiwanese Entities if the Target Company becomes a PRC
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investor. Furthermore, as PRC investors are only allowed to invest in specific businesses
explicitly listed on the positive list as promulgated by the Taiwan DIR, the registered scopeof business of Group Taiwanese Entities may need to be adjusted accordingly forcompliance. Please refer to Appendix G titled “Government Regulations – Taiwan – ROC
Act” of this Circular for the definition of “PRC investor” and further details.
The Target Company or the Resulting Issuer will be considered a PRC investor if any
individual, juristic person, organisation or any other institution of PRC (“Mainland
Person(s)”) directly or indirectly hold more than 30% of its shares in aggregate or havecontrol 5 over it. As at the date of this Circular, no Mainland Persons, individually or inaggregate, hold more than 30% of the shares of the Target Company or have control of theTarget Company, and the Target Company is able to monitor potential changes in its
shareholding structure resulting from proposed direct or indirect transfers of its sharesthrough the transfer restrictions in its shareholders agreement, and consider the potential
implication under the PRC ownership restrictions. As at Completion, Mainland Persons will
not, individually or in aggregate, hold more than 30% of the Shares of the Resulting Issuer
or have control over the Resulting Issuer, and the Resulting Issuer would not be required
to obtain approvals by the Taiwan DIR to hold the interests in the Group Taiwanese Entities.
After Completion, while it would be difficult for us to track the trading of all Shares in thesecondary market, and we cannot assure that Mainland Persons will not, in aggregate,
directly or indirectly acquire more than 30% (or such other limit as may be stipulated underapplicable Taiwan laws and regulations at the relevant time) of the Shares from time to time,
we will, monitor information available to us by conducting reasonable enquiry, including
through the disclosures of substantial shareholding notifications. We will also actively
conduct due diligence on any proposed director and executive officer who may beconsidered Mainland Person(s) in respect of the potential implication under the PRC
ownership restrictions.
If the Target Company becomes a PRC investor, we will be prohibited from investing in
Taiwan (including maintaining any existing investments in Taiwan) unless we obtainapproval from the Taiwan DIR. In addition, in the event the PRC ownership restrictions arebreached, the Taiwan DIR may impose fines or other penalties, including ordering theshareholder(s) (which have been considered as a PRC investor) of Group Taiwanese
Entities to withdraw its investment in Group Taiwanese Entities, forbidding the shareholder
to exercise its shareholder rights, or cancelling or invalidating the company registration ofGroup Taiwanese Entities. The quantum of the administrative fine is determined withreference to the amount invested in the Taiwan investee company, based on which thequantum of the fine expected to be imposed on the Target Company or the Enlarged Group
if there is a breach of the PRC ownership restrictions is expected to be approximately
NT$4,026,400 in respect of 17LIVE Taiwan, NT$610,000 in respect of HandsUp,
NT$210,000 in respect of NEI, NT$510,200 in respect of Wave, NT$210,000 in respect of
NETW. Based on the Act and the Administrative Procedure Act of Taiwan, Taiwan DIR will
issue an official letter to the breaching shareholder and seek for the shareholder’s
explanation, and the relevant penalties will be imposed upon the conclusion of Taiwan DIR’s
investigation, if there’s any breach. It will also request the company to take action(s) to
5

The definition of “control” under the ROC Act means any of the following: (i) the ability to control majority of the voting
power pursuant to contractual arrangement with other investor(s); (ii) the ability to control the direction of thecompany’s financial, operation and human resource matters pursuant to law or contractual arrangement; (iii) theability to appoint or dismiss the majority of the board or its equivalent organisation, and the operation of the company
is controlled by the board or such equivalent organisation; (iv) the ability to control majority in voting power of theboard or its equivalent organisation, and the operation of the company is controlled by the board or such equivalentorganisation; or (v) other circumstances would be deemed to have control pursuant to IFRS or applicable enterpriseaccounting standards.

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rectify such breach within a certain period of time pursuant to the Act. If the breach is not
remedied (including if approval from the Taiwan DIR is not obtained) within the grace
period, penalties may be imposed on the shareholder. If the PRC investor fails to meet thedeadline for rectification, it may also be subject to consecutive fines until the breach is
rectified. In addition, a PRC Investor may only invest in a Taiwan company which engages
in business items set out in the “Positive List” approved by the MOEA from time to time.
Although not all the registered business items of Group Taiwanese Entities and thebusiness items they engage in are set out in the “Positive List” in force as at the Latest
Practicable Date, the Taiwan DIR would request the relevant Group Taiwanese Entities toamend its registered business items and order that such Group Taiwanese Entities should
not engage in businesses that are not in the Positive List during the review process.
However, as the grant of approval by the Taiwan DIR is at its discretion, if the Company
becomes a PRC Investor, there is no assurance that approval of the Taiwan DIR can beobtained within the stipulated deadline or at all. Under the ROC Act, the Taiwan DIR may
reject the approval for various reasons, such as the investment causing a monopoly,
oligopoly, or adverse impact on the national safety or domestic economy or financial
market. Further, as the “Positive List” is subject to change by the MOEA, there is no
assurance that the registered business items of Group Taiwanese Entities and the business
items they engage in will always fall within the prevailing “Positive List”. If we become awarethat the aggregate shareholding percentage of Mainland Persons has exceeded therelevant threshold and we become a PRC Investor, we will take appropriate actions toensure compliance with the PRC ownership restrictions, including assessing if theregistered business items of the Group Taiwanese Entities are on the “Positive List” in force
at the relevant time, and if required, obtaining the requisite approvals from the Taiwan DIR.
Our operations in Taiwan attributed approximately 23.9% of our revenue for FY2022. If we
become a PRC Investor and we are unable to obtain approval of the Taiwan DIR for theCompany’s continued ownership of Group Taiwanese Entities, satisfy any conditions towhich approval of the Taiwan DIR may be subject or undertake adequate remedial actions
by the stipulated deadline or at all or maintain the registered business items of the Group
Taiwanese Entities which are relevant to the core businesses of the Group Taiwanese
Entities, the Company’s business, financial condition, operational results and prospects
may be materially and adversely affected.
The Target Group may be adversely affected by the complexity, uncertainties andchanges in licensing and regulation of live streaming and internet businesses.
The laws and regulations governing the online live social entertainment industry injurisdictions in which the Target Group operates are developing and evolving and subject tochanges. For example, in May 2022, Taiwan regulatory authorities announced the Draft
OTT Law for public comments, under which the internet audio and video services providers
are required to be registered with the competent authority. In August 2022, Taiwan
regulatory authorities further announced the Digital Media Communication Regulation Act(Draft) (數位中介服務法草案) (the “Digital Media Act”) for public comments, under which
digital media communication service providers, such as social media and mobile application
operators, are required to disclose relevant information, including business details, terms
and conditions of use, privacy policies, notification and complaint mechanism. Appendix G
titled “Government Regulations – Taiwan – Digital Media Act” of this Circular for further
details. It is unclear when the Draft OTT Law and Digital Media Act will take effect. Basedon the proposed scope and content of the Draft OTT Law and Digital Media Act that iscurrently published, the Target Group is of the view that it will be able to comply with
relevant requirements under the Draft OTT Law and Digital Media Act.
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Due to the increasing popularity and use of the internet and other online services, additionallaws and regulations may be adopted with respect to the internet or other online services
covering issues such as user privacy, pricing, content, copyright and distribution. The
adoption of additional laws or regulations may subject the Target Group to additional
regulatory or administrative requirements, resulting in an increase in its operating
expenses.
Additional taxes paid with respect to the revenue recognition in Taiwan may
adversely affect the financial conditions of the Target Group.
As a general principle of revenue recognition, since FY2022, the Target Group allocatesrevenue from selling its virtual points based on the location of live streamers or V-Livers
who receive the virtual gifts redeemed from purchased virtual points. Before FY2022, theTarget Group allocated revenue based on the location of the users who purchase virtual
points. In relation to the Target Group’s live commerce business, as of the Latest
Practicable Date, the Target Group operates its live commerce business independently ineach relevant jurisdiction. There has not been any cross-jurisdiction sale, and the Target
Group allocates its live commerce revenue based on the location of the sale. If the virtual
points are purchased by the users in Japan, then these sales revenues are reported inJapan for tax purposes. If the virtual points are purchased by the users in Taiwan, thenthese sales revenues are reported in Taiwan for tax purposes. However, for the financial
years ended 31 December 2016, 2017, 2018, 2019 and 2020, Ichi Nana Inc. Taiwan Branchand 17LIVE Taiwan allocated sales revenue from points sold through the Taiwan Google
Play and iOS App Store to the British Virgin Islands. In response to a tax inquiry by the
Taiwan tax authorities in 2021, the Target Group changed its revenue recognition practicein Taiwan in compliance with Taiwan tax law and adjusted its historical financial statements
to recognise the re-allocated revenues in Taiwan. The Target Group settled and paid all
outstanding tax liabilities for the financial years ended 31 December 2016, 2017, 2018,2019 and 2020 to the Taiwan tax authorities on 24 December 2021. During the Period Under
Review and up to the Latest Practicable Date, no further queries were received from the
Taiwan tax authorities in this regard. As of the Latest Practicable Date, the Target Group
had no outstanding queries from tax authorities and the Target Group has engaged external
tax advisers in Japan, Taiwan, Hong Kong, the United States and Singapore. However,there is no assurance that such principle of allocation of revenue by geography will beagreeable to the various tax authorities in the jurisdictions in which the Target Group
operates. No such risk is associated with the Target Group’s live commerce revenue, whichis generated domestically in each relevant jurisdiction and is only allocated to the location
where the sales took place.
The Target Group may be exposed to additional tax liability in the jurisdictions inwhich live streamers or V-Livers are located if the Target Group is treated as having
a permanent establishment in such jurisdictions.
The Target Group may create a permanent establishment in the jurisdictions in which thelive streamers or V-Livers are located, subject to whether the live streamers or V-Livers
constitute dependent agents6 of the Target Group. If the Target Group is determined byrelevant tax authorities as having a permanent establishment in a jurisdiction other than its
6

Based on the Organisation for Economic Cooperation and Development (“OECD”) principles, a dependent agent isa person that provides a particular service to an enterprise from a country where the person is located. Such persons
may be either individuals or companies and need not be residents of, nor have a place of business in, the country inwhich they act for the enterprise. Additionally, a dependent agent is also a person who is either legally and/or
economically dependent of the enterprise that they are acting on behalf of.

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country of incorporation, as far as the Company’s tax adviser is aware, the Target Groupmay be subject to additional income tax in such jurisdiction in respect of the revenue thatis attributable to the permanent establishment in such jurisdiction. As a result, the Target
Group’s income tax expense could materially increase, which could have a material
adverse effect on the Target Group’s business, operational results, financial condition andprospects. However, it should be noted that the Target Group has changed its revenue
recognition practice in 2021 to recognise revenue based on where live streamers or
V-Livers are located, as described in the previous point for Taiwan, one of the Target
Group’s largest markets. No comments were raised by the Target Group’s tax advisers on
the change of revenue recognition practice and it is in line with the revenue recognition
practices of companies comparable to the Target Group. The change in the revenue
recognition practice is consistently implemented across the Target Group, except that it did
not affect India in practice, as Indian users generally only consume domestic content.
Additionally, the Company’s tax adviser has also been made aware that the Target Groupis in the midst of developing a transfer pricing policy to ensure that profits are reasonably
allocated to the various jurisdictions in which the Target Group operates, which could
potentially reduce the overall risk of relevant tax authorities subjecting the Target Group to
additional income tax in these jurisdictions. The Target Group intends to finalise the transfer
pricing policy before Completion, and the Proposed New Audit Committee will oversee theimplementation of the transfer pricing policy.
Failure to comply with applicable foreign regulations, in particular regard to foreignexchange and enterprise income tax and value added tax in the PRC, may subject theTarget Group to fines and other legal or administrative sanctions.
The Target Group mainly operates its business in Japan and Taiwan. Although the Target
Group does not market or make its applications available for download from all app storesin the world including the PRC, some individuals located in jurisdictions where the Target
Group does not operate may be able to download its applications through the APK file on
its website or while travelling outside of these jurisdictions. The Target Group may generate
revenue from these users, which may therefore subject the Target Group to various foreign
regulations, such as licences, approvals and permits, as well as tax implications. The Target
Group may be subject to tax audits or tax investigation by the tax authorities in jurisdictions
in which it operates. For example, 17LIVE Japan was subject to a tax audit by the National
Tax Agency of Japan with respect to the Japanese Consumption Tax for the financial years
ended 31 December 2018 to 2021. As of the Latest Practicable Date, such tax audit has
been completed. There was no offence uncovered through the tax audit and all tax liabilities
relating to the tax audit have been recorded in the Target Group’s consolidated financial
statements for the financial years ended 31 December 2020, 2021 and 2022 and there isno additional potential tax liability for the Target Group in relation to such tax audit.
For instance, individuals located in the PRC have been able to download the Target Group’s
applications through the APK file on its website or while travelling outside of the PRC. The
Target Group generated a certain amount of revenue from users located in the PRC for thefinancial year ended 31 December 2022 and continued to collect minimal amounts for thesix months ended 30 June 2023 through NEHK. As the Target Group has not established aregular office or company bank account in the PRC, its PRC users were not able to makepayments directly to the Target Group and instead made payments in Renminbi to a PRC
individual not employed by the Target Group during 2017, and to one of the Target Group’s
employees in 2018. Each of these individuals in turn transferred the fees either to the Target
Group’s vendors or employees located in the PRC to offset payables, or to its bankaccounts outside of the PRC, after deducting an agreed commission. Such business
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activities may subject the Target Group to various PRC regulatory requirements, such as
licences, approvals and permits. In particular, under PRC regulations, certain foreignexchange activities can only be conducted by qualified financial institutions. If the Target
Group were found to be in violation of such regulations, it may be subject to fines or otherpenalties. In addition, if the PRC tax authorities determine that the Target Group provided
services in the PRC, given the cross-border nature of the internet and because certain
buyers of its services are located in the PRC, it may be subject to enterprise income tax orvalue added tax. The PRC tax authorities may also impose late payment fees and otherpenalties on the Target Group for currently unpaid taxes. As of the Latest Practicable Date,the Target Group has ceased all business operations in the PRC, and individuals in the PRC
can no longer download the Target Group’s application or make payments to the Target
Group through alternative means.
The Target Company faces uncertainties with respect to the indirect transfer of equity
interest in a PRC subsidiary of the Target Group.
The Target Company conducted a restructuring of its group entities in 2021. In the
restructuring, 17LIVE Japan purchased the 100% equity interests in NEHK, a Hong Kong
subsidiary of the group, from NEGH, a Cayman subsidiary of the Target Group. NEHK holds
100% equity interests in NEBJ, a PRC subsidiary of the Target Group. Estimated PRC
taxes, and the related late payment fees and penalties in relation to the transfer of NEHK
potentially amount to up to US$30,000 in aggregate as of the Latest Practicable Date.
There may be tax consequences arising from the restructuring, and the Target Group may
incur additional tax expenses including late payment fees and other penalties forunder-payment of taxes. As a result, the business, operational results, financial conditionand prospects may be adversely affected.
Uncertainties with respect to the tax treatment of the unutilised tax losses of Ichi
Nana Inc. Taiwan Branch may adversely affect the financial conditions of the Target
Group.
Ichi Nana Inc. Taiwan Branch had US$33.5 million unutilised tax losses as of 31 December
2022. On 1 January 2023, Ichi Nana Inc. transferred the business of Ichi Nana Inc. Taiwan
Branch to 17LIVE Taiwan. Ichi Nana Inc. Taiwan Branch’s unutilised tax losses could
potentially be carried over by 17LIVE Taiwan based on the interpretation of Article 43 of
Taiwan Business Mergers and Acquisitions Act. However, there are uncertainties withrespect to whether Article 43 applies to cross-border spin-off transactions and there is noprecedent or Taiwan tax ruling to confirm the carryover treatment of cross-border spin-off
transactions. Therefore, there is a risk that the losses may not be allowed to be carried overby 17LIVE Taiwan. No material adverse implication is expected on the Target Group’s
consolidated financial statements in the event the losses from Ichi Nana Inc. Taiwan Branch
are not allowed to be carried over by 17LIVE Taiwan, as the Target Group did not recognise
any deferred tax assets pertaining these unutilised tax losses from Ichi Nana Inc. Taiwan
Branch.
Potential Taiwan tax liability for the transfer of know-how may adversely affect thefinancial conditions of the Target Group.
In September 2021, Ichi Nana Inc. Taiwan Branch transferred some know-how to 17LIVE
Services Inc. without receiving any compensation. Under the Taiwanese transfer pricing
regulations, any asset transfer between related parties should be transacted at the fairmarket value of the asset. The Taiwanese tax authority may require 17LIVE Taiwan (in its
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capacity as the successor entity of Ichi Nana Inc. Taiwan Branch) to prepare a valuation
report to validate the transfer price of NT$0. In the event that the valuation report indicatesthat the transfer price should be greater than NT$0, 17LIVE Taiwan may be required by the
Taiwanese tax authority to recognise a gain for the transfer of know-how based on thevaluation report, which would need to be included for 17LIVE Taiwan’s corporate income tax
assessment. The resulting gain would be subject to a corporate income tax rate of 20%. In
addition, 17LIVE Taiwan would be subject to 5% value-added tax on the transfer priceadjusted based on the valuation report. As of the Latest Practicable Date, the tax exposureis unquantifiable due to the lack of the valuation report. The “know-how” here was theinherent skills and experience of the employees who resigned from Ichi Nana Inc. Taiwan
Branch and joined 17LIVE Taiwan simultaneously, as part of the Target Group’s internal
restructuring, and there was no separate know-how or any other intellectual property thatwas transferred to the 17LIVE Taiwan. A valuation report will not be prepared on the basisthat practically, employees’ inherent skills and experience would be difficult to be financiallyvalued. Generally speaking, except in limited circumstances, the statute of limitation formaking tax assessments in Taiwan is five years from the tax return filing date. The
maximum tax exposure is not quantifiable without a valuation report being produced, andas of the Latest Practicable Date, no valuation report has been prepared. The tax exposurethat the Target Group may be subject to is covered under the representations andwarranties from the Warrantors. Please refer to Clause 9.12 of Part A of Section D ofAppendix K to this Circular for further details. The Target Group believes that this will nothave a material adverse impact on its financials and/or operations.
The Target Group’s business is subject to complex and evolving laws and regulations
in various jurisdictions. The laws, regulations and actions, as well as the legal
systems in these jurisdictions are subject to change and uncertain interpretation,and could result in claims, changes to its business practices, monetary penalties,
increased cost of operations or declines in growth or engagement level of users, live
streamers and V-Livers, restricted access to its services or otherwise harm its
business.
The Target Group is subject to a variety of laws and regulations in jurisdictions where it
operates its business that involve matters central to its business, including those relating tolive streaming services, virtual gifting, social networking, live commerce services, gamblingand gaming services, privacy and data protection, telecommunications service, online
cultural activities, online transmission of audio-visual programmes, internet publication andcultural products, labour laws, intellectual property, national security, computer security,
online content restrictions, protection of minors, youth welfare and rights, anti-money
laundering, anti-corruption and anti-bribery, prevention of financing criminal activities andterrorism, electronic payment services regulations, currency control regulations, internet
content and information security, consumer protection, competition, advertising, productliability and foreign investments. Furthermore, the introduction of new products andservices, expansion of its activities in certain jurisdictions, or other actions that the Target
Group may take, may subject it to additional laws, regulations, or other government
scrutiny.
These foreign laws and regulations in jurisdictions where the Target Group operates its
business, which in some cases can be enforced by private parties in addition to government
entities, are constantly evolving and can be subject to significant change. As a result, theapplication, interpretation, and enforcement of these laws and regulations are often
uncertain, particularly in the new and rapidly evolving industry in which the Target Group
operates, and may be interpreted and applied inconsistently from market to market and194

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inconsistently with its current policies and practices, which could adversely affect themanner in which the Target Group provides its services or its financial results. For example,
the Target Group is subject to laws and regulations that dictate whether, how, and underwhat circumstances it can transfer, process and/or receive transnational data that is criticalto its operations, including data relating to users, live streamers, V-Livers or partners
outside Taiwan, and those laws and regulations are uncertain and subject to change. The
regulatory framework for privacy issues in Asia is currently in a state of flux and is likely toremain in such state for the foreseeable future. It is possible that obligations imposed underapplicable laws may be interpreted and applied in a manner that is inconsistent from one
jurisdiction to another and may conflict with other rules or its practices. Any failure orperceived failure by the Target Group to comply with its privacy policies, its privacy-related
obligations to its users, live streamers, V-Livers or other third parties, or its privacy-related
legal obligations, or any compromise of security that results in the unauthorised release ortransfer of information or other data, may result in governmental enforcement actions,litigation or public statements against it by consumer advocacy groups or others and could
cause its users, live streamers and V-Livers to lose trust in the Target Group, which could
have an adverse effect on its business. Furthermore, if third parties with whom the Target
Group works, such as its users, live streamers, V-Livers, its service partners and content
creation partners, or its third party service providers, violate applicable laws or the Target
Group’s policies, such violations may put the Target Group’s user, live streamer and V-Liverinformation at risk and could have an adverse effect on the reputation and business of theTarget Group.
The legal systems in the jurisdictions in which the Target Group operates vary significantly
from jurisdiction to jurisdiction. Some jurisdictions have a civil law system, such as Japanand Taiwan which are based on written statutes, and others are based on common law,such as Singapore and Hong Kong. Unlike the common law system, prior court decisions
on specific cases under the civil law system may be cited for reference, but the statutory
laws serve as the primary source of the law. In addition, certain laws and regulations inother jurisdictions where Target Group operates its business, including those pertaining todata protection, privacy and competition, gambling and gaming, may be more restrictive
than those in Singapore.
Proposed or new legislation and regulations could also significantly affect its business.
There are currently a number of proposals pending before foreign legislative and regulatory
bodies. Japan promulgated an amendment to the Act on the Protection of Personal
Information on 12 June 2020, which has been in force since 1 April 2022. In addition, somecountries are considering passing or have passed legislation imposing data protection
requirements or requiring local storage and processing of data or similar requirements that
could increase the cost and complexity of delivering its services. In Singapore, theProtection from Online Falsehoods and Manipulation Act 2019 (the “POFMA”) came into
effect in Singapore on 2 October 2019. The POFMA primarily aims to prevent the electronic
communication of false statements of fact in Singapore and enable measures to be taken
to counteract the effects of such communication. The POFMA grants power to thecompetent authority in Singapore to issue binding codes of practices applicable to digitaladvertising intermediaries and internet intermediaries as a more proactive step to prevent
abuse of their platforms and keep their platforms safe and secure. The POFMA also sets out
the actions and orders which may be made against internet intermediaries and providers ofmass media services. These include directions which may be made to an internet
intermediary that provided the service by means of which the relevant material wascommunicated in Singapore, such as a targeted correction direction i.e. to communicate bymeans of that services to all end users in Singapore, a correction notice or a disabling
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direction i.e. to disable access by end-users in Singapore. In addition, amendments relating
to the enforcement under the Personal Data Protection Act 2012 of Singapore (the “PDPA”),
came into effect on 1 October 2022. The PDPA governs the collection, use and disclosureof personal data by organisations, and is administered and enforced by the Infocommunications Media Development Authority (which is also designated as the Personal
Data Protection Commission under the PDPA). It sets out, among other things, dataprotection obligations which all organisations are required to comply with in undertaking
activities relating to the collection, use or disclosure of personal data. The recent
amendments to the PDPA enhanced the Personal Data Protection Commission’s power toaccept voluntary undertakings as part of its enforcement regime and increased the financial
penalty cap which may be imposed on organisations for breaches under the PDPA from thepreviously fixed S$1 million to 10% of the organisation’s annual turnover in Singapore fororganisations with annual local turnover exceeding S$10 million, whichever is higher.
These laws and regulations, as well as any associated inquiries or investigations or any
other government actions, may be costly to comply with and may delay or impede thedevelopment of new products, result in negative publicity, increase the operating costs of
the Target Group, demand significant time and attention from the Target Group’s
management, and subject the Target Group to penalties that may harm its business,
including fines or demands or orders that it modifies or ceases its existing businesspractices.
The Target Group may be adversely affected if any sales are made to certain
countries that are or become subject to international sanctions.
The United States and other jurisdictions or organisations, including the European Union,
the United Nations and Australia, have in place economic sanctions against certain
countries or against targeted industry sectors, groups of companies or persons, and/ororganisations within such countries. Since the Target Group operates its business in the
United States and Asia, it may be subject to sanctions administered by the United States,
the United Nations and other relevant sanctions authorities if it sold its products or provided
its services to persons or entities on the sanctions list, such as the sanctions list maintainedby the U.S. Department of Treasury’s Office of Foreign Assets Control (“OFAC”). Countries
that are currently under the OFAC sanction include Syria, Iran, Russia, Belarus, Cuba andothers.
In addition, the Target Group has implemented and will continue to implement enhanced
internal control and risk management measures which it believes enable it to monitor andevaluate its business to address economic sanctions risks. If the Target Group, due to either
its own deliberate or inadvertent acts or those of others, sells its products or provides its
services to persons or entities being sanctioned by relevant authorities, its reputation could
be damaged and it may face civil, administrative or criminal penalties or incur significant
expenses, which could have a material and adverse effect on its business, operational
results, financial condition and prospects.

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The ability of the Target Company’s subsidiaries to distribute dividends or transfer
profits to the Target Group may be subject to restriction under the laws of thejurisdiction in which such subsidiary operates.
The Target Company is a holding company, and its subsidiaries are located in jurisdictions
where the Target Group operates its business, including Japan, Taiwan, Hong Kong,
Singapore, the United States and India. Internal sources of funds to meet its cash needs
include dividends paid by its subsidiaries. The distribution of dividends to the Target
Company from its subsidiaries is subject to restrictions imposed by the applicable laws andregulations in these markets, which are more fully described in Section 28.2 titled “Dividend
Policy – The Target Group” of this Circular. In addition, except for the limitations describedin Appendix G titled “Government Regulations” of this Circular, although there are currently
no foreign exchange control regulations which restrict the ability of its subsidiaries in Japan,
Taiwan, Hong Kong, Singapore, the United States and India to distribute dividends to theTarget Company, the relevant regulations may be changed and the ability of thesesubsidiaries to distribute dividends to the Target Company may be restricted in the future.
It may be difficult for overseas regulators to conduct an investigation or collectevidence in jurisdictions in which the Target Group operates.
Shareholder claims or regulatory investigations generally are difficult to pursue as a matterof law or practicality in jurisdictions in which the Target Group operates. The Japanese
securities laws do not expressly permit overseas regulators to conduct investigations inJapan. However, a foreign government may request the Japanese government to cooperatein accordance with mutual legal assistance treaties, and in the absence of such mutual legal
assistance treaty, a foreign government may request cooperation by the Japanese
government in criminal investigation of a specific case in accordance with the Act on
International Assistance in Investigation and Other Related Matters of Japan. In Taiwan,
where a foreign government has undertaken an investigation, prosecution or judicial
procedure in connection with any suspected violation of foreign financial regulatory
legislation, and such foreign government requests assistance with investigation inaccordance with the treaty or agreement made pursuant to the Taiwan Securities andExchange Act, the Taiwan prosecutor’s office may require institutions, juristic persons,associations, or natural persons related to the securities trading to present relevant accountbooks or documents or to appear at its offices. When necessary, the Taiwan prosecutor’s
office may request the foreign government to send representatives to participate in its
investigations. However, during the Period Under Review and up to the Latest PracticableDate, the Taiwan government has not entered into such treaty or arrangement with thecompetent authority in Singapore.
It will be difficult to enforce liabilities against the Target Group’s assets based insome parts of Asia.
Substantially all of the Target Group’s assets are located in Asia and substantially all of its
directors and executive officers reside outside of Singapore. As a result, it may not be
possible for investors in Singapore to enforce their legal rights, to effect service of process
upon the Target Group’s directors or executive officers or to enforce judgments of theSingapore courts predicated upon civil liabilities and criminal penalties of directors andexecutive officers of the Target Group under Singapore securities laws. Moreover, theTarget Group’s management has been advised that Taiwan and other jurisdictions within
Asia where the Target Group operates do not have treaties providing for the reciprocal
recognition and enforcement of judgments of courts with Singapore. Pursuant to the Taiwan
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Code of Civil Procedure, a foreign judgment needs to be recognised by a Taiwan court
before being enforced, which renders its enforceability uncertain. The Code of Civil
Procedure of Japan also contains similar provisions. Further, it is unclear if extradition
treaties now in effect between Singapore and some markets within Asia, such as Taiwan
and Japan, would permit effective enforcement of criminal penalties of the Singapore
securities laws in those jurisdictions. Moreover, there is no extradition treaty between
Singapore and Taiwan or Japan, and an extradition relies solely on the cooperation between
the governments.
You may face difficulties in protecting your interests, and your ability to protect yourrights through Singapore courts may be limited, because the Target Company and
VTAC are incorporated under Cayman Islands law.
The Target Company and VTAC are exempted companies with limited liability incorporated
under the laws of the Cayman Islands. Their corporate affairs are governed by theirrespective memorandum and articles of association, the Cayman Companies Act and thecommon law of the Cayman Islands. The rights of shareholders to take action against thedirectors, actions by minority shareholders and the fiduciary duties of the directors of theTarget Company and VTAC under Cayman Islands law are to a large extent governed by thecommon law of the Cayman Islands. The common law of the Cayman Islands is derived inpart from comparatively limited judicial precedent in the Cayman Islands as well as from thecommon law of England, the decisions of whose courts are of persuasive authority, but may
not be binding, on a court in the Cayman Islands. The rights of the shareholders and thefiduciary duties of the directors of the Target Company and VTAC under Cayman Islands
law are not as clearly established as they would be under statutes or judicial precedent in
Singapore. In particular, the Cayman Islands has a less developed body of securities laws
than Singapore. In addition, Cayman Islands companies may not have standing to initiate
a shareholder derivative action in the Singapore courts.
Shareholders of Cayman Islands exempted companies have no general rights underCayman Islands law to inspect corporate records or to obtain copies of lists of shareholdersof these companies. The Target Company’s and VTAC’s directors have discretion under
their memorandum and articles of association to determine whether or not, and under what
conditions, their corporate records may be inspected by their shareholders, but are notobliged to make them available to their shareholders. This may make it more difficult for you
to obtain the information needed to establish any facts necessary for a shareholder motion
or to solicit proxies from other shareholders in connection with a proxy contest.
Certain corporate governance practices in the Cayman Islands, which is the home countryof Target Company and VTAC, differ significantly from requirements for companies
incorporated in other jurisdictions such as Singapore. Currently, the Target Company and
VTAC do not plan to rely on home country practice with respect to any corporate
governance matter. However, if they choose to follow the home country practice in the
future, their shareholders may be afforded less protection than they otherwise would underrules and regulations applicable to Singapore issuers.
As a result of all of the above, Public Shareholders may have more difficulty in protecting
their interests in the face of actions taken by the Management Team, the Board orControlling Shareholders than they would as Public Shareholders of a company
incorporated in Singapore.

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16.3 Risks relating to VTAC and the Proposed Business Combination
Our Directors and Executive Officers and their affiliates have interests that are
different than, in addition to, or may conflict with, the interests of Shareholders, andtherefore potential conflicts of interest exist in recommending that Shareholders votein favour of the Proposed Business Combination.
When considering the Board’s recommendation to vote in favour of the Proposed Business
Combination, you should keep in mind that the Directors and Executive Officers have(subject always to their fiduciary duties under Cayman Islands law) interests in suchproposals that are different from, in addition to, or may conflict with, your interests as
Shareholders generally.
In particular, Mr. Chua Kee Lock (a) has interests as a direct or indirect individual investor
in GPs that manage the Vertex Funds, which are shareholders of the Target Company; and(b) is a member of the investment committees (“ICs”) formed by the fund managers
appointed by the GPs which manage the Vertex Funds in his individual capacity. Mr. Chua’s
participation in the GPs and ICs of the Vertex Funds is in his individual capacity and not forand on behalf of the Sponsor Group. There are no representatives from the Sponsor Groupin the GPs and ICs of the Vertex Funds. In addition, Mr. Chua has provided an undertaking
to recuse himself from voting in his capacity as a member of the ICs in the Vertex Funds,
in respect of any decision in relation to an initial business combination with a portfolio
company that is under any of the Vertex Funds.
The personal and financial interests of the Directors and Executive Officers (such as
Mr. Chua’s interests set out above) may have influenced their motivation in identifying andselecting the Target Company for the Proposed Business Combination, subject always totheir fiduciary duties under Cayman Islands law. You should consider these interests inconsidering the recommendations of the Board to vote for the Proposed Business
Combination.
If our Sponsor, Directors, Executive Officers or any of their respective affiliates electto purchase Shares from Public Shareholders, they may influence the vote on the
Proposed Business Combination and reduce the public “float” of our Shares.
Our Sponsor, Directors, Executive Officers or any of their respective Associates maypurchase Shares in privately negotiated transactions or in the open market prior to the
EGM. Additionally, at any time prior to the EGM, subject to applicable securities laws(including with respect to material non-public information), our Sponsor, Directors,
Executive Officers or any of their respective Associates may enter into transactions withinvestors and others to provide the latter with incentives to acquire Shares and vote their
Shares in favour of the Proposed Business Combination, thereby increasing the likelihoodof obtaining Shareholder approval for the Proposed Business Combination. This may resultin the Completion of the Proposed Business Combination that may not otherwise have beenpossible. In addition, if such purchases are made, the public “float” of our Shares and thenumber of beneficial holders of our Shares may be reduced, possibly making it difficult tomaintain or obtain the quotation, listing or trading of our Shares on the SGX-ST. However,
our Sponsor, Directors, Executive Officers, advisers or any of their respective Associates
are under no obligation or duty to enter into such transactions and as far as we are aware,they have no current commitments, plans or intentions to engage in such transactions andhave not formulated any terms or conditions for any such transactions.

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The process of going public by means of an initial business combination with a SPAC
may create additional risks for Shareholders.
Unlike in the case of a traditional underwritten initial public offering, going public via an
initial business combination with a SPAC does not involve a book-building process. The
value of the Target Company was established by means of negotiations among theCompany, the Target Company, and the PIPE Investors who agreed to subscribe for theBase PIPE Shares at the time of the Proposed Business Combination, which may be lesseffective than a traditional book-building process, and will not reflect events that may haveoccurred between the date of the Sale and Purchase Agreement and Completion. Similarly,
unlike a traditional initial public offering, there is no stabilising manager nor stabilisingaction for the Proposed Business Combination. As such, there may be share price volatility
immediately after Completion of the Proposed Business Combination.
In addition, not going public by way of a traditional underwritten initial public offering may
result in less coverage on the Company, the Target Company and the Proposed Business
Combination by securities and industry analysts. Accordingly, investment banks may beless inclined to underwrite follow-on or secondary offerings by the Company, which may
adversely affect the liquidity of the Company’s securities.
If our due diligence investigation on the Target Group was inadequate, Shareholders
could lose some or all of their investment following the Proposed Business
Combination. After Completion of the Proposed Business Combination, we may berequired to take write-downs or write-offs, restructuring and impairment or othercharges that could have a significant negative effect on our financial condition,
operational results and the price of our Shares, which could cause you to lose someor all of your investment.
While the Company and the Sole Issue Manager have conducted a due diligence
investigation on the Target Group which we believe to be reasonable, there is no assurance
that the due diligence uncovered all material issues relating to the Target Group and its
business, and material information may later surface which could cause Shareholders tolose some or all of their investment. As a result, we may be forced to later write-down or
write-off assets, restructure our operations, or incur impairment or other charges that could
result in our reporting losses. Even if our due diligence investigation successfully identifies
certain risks, unexpected risks may arise and previously known risks may materialise in amanner not consistent with our preliminary risk analysis. Even though these charges may
be non-cash items and not have an immediate impact on our liquidity, the fact that we reportcharges of this nature could contribute to negative market perceptions about us or our
Shares. Accordingly, any Shareholders who choose to retain their Shares following theCompletion of the Proposed Business Combination could suffer a reduction in the value of
their Shares. Such Shareholders are unlikely to have a remedy for such reduction in value.
We did not obtain an independent financial adviser’s evaluation on whether the
Proposed Business Combination constitutes an interested person transaction under
the Mainboard Rules.
We are not required to obtain an opinion from an independent financial adviser that theterms of the Proposed Business Combination are on normal commercial terms and are notprejudicial to the interest of the Company and minority Shareholders as we are notcompleting the Proposed Business Combination with an interested person (as determined
under Chapter 9 of the Listing Manual). The Sale and Purchase Agreement in respect of the200

LETTER TO SHAREHOLDERS
Proposed Business Combination was entered into between the Company (i.e. the entity atrisk), the Vendor and the Warrantors. The Vendor is not an “interested person” as definedin Rule 904(4) of the Mainboard Rules. The Vendor is not a Director or CEO of theCompany, or an Associate of a Director or CEO of the Company. Further, the Vendor is not
a Controlling Shareholder of the Company. As at 30 March 2023, the Shareholders with thelargest direct interests in the Company are Vertex SPV, Venezio and Income Insurance
Limited (formerly known as NTUC Income Insurance Co-operative Limited), each of whichhold less than 15% of the Shares. Further, the Vendor is not an Associate of the deemed
Controlling Shareholders of the Company, namely, Temasek and Tembusu, and is hence notan “interested person” in respect of the Company. The Vertex Funds hold an aggregate of
16.2% of the Vendor. Pavilion, which is an indirect wholly-owned subsidiary of Temasek,
holds 3.9% of the Vendor. Each of Vertex SPV, the Vertex Funds and Pavilion is anindependently managed Temasek portfolio company. Temasek is not involved in thebusiness or operational decisions of these entities, including their decisions in relation to
the Target Group and the Company. Accordingly, the Proposed Business Combination will
not constitute an “interested person transaction” pursuant to Rule 904(5) of the Mainboard
Rules. In relation to Rule 210(11)(m)(ix) of the Mainboard Rules, given that the Vendor is
not the founding shareholder of the Company or a member of the Management Team of theCompany or their respective Associates, Chapter 9 of the Mainboard Rules would not apply
to the Proposed Business Combination. Accordingly, we are not required to obtain an
opinion from an independent financial adviser that the terms of the Proposed Business
Combination are on normal commercial terms and are not prejudicial to the interest of theCompany and minority Shareholders, and Vertex SPV, Venezio and Income Insurance
Limited will be able to vote on the resolution in respect of the Proposed Business
Combination at the EGM.
For completeness, while the Sponsor Group has invested in the Target Group through theVertex Funds and hold LP interests in each of the Vertex Funds, the Sponsor Group does
not hold majority of the LP interests in any of the Vertex Funds. The Vertex Funds aremanaged by independent GPs and operate independently from the Sponsor Group, andinterest in each of the GPs of the Vertex Funds are held by the team of investment
professionals (in their individual capacities) managing the relevant Vertex Fund. Given that
the GPs who manage the Vertex Funds are not subsidiaries of the Sponsor, the Sponsor
does not have control or influence over the operations of or the decision-making of the
Vertex Funds, including investment decisions on the Proposed Business Combination
involving the Target Group. There are no differences in rights (including economic rights)
accorded to the Sponsor Group as a LP interest holder of the Vertex Funds compared to theother LP interest holders of the Vertex Funds, and the Sponsor Group does not enjoy any
special rights as a LP interest holder of the Vertex Funds which have not been accorded toother LP interest holders of the Vertex Funds. Given that the Sponsor Group does not holdany direct or indirect interest in the GPs of the Vertex Funds, it does not receive any
benefits (monetary or otherwise), including carried interest, arising from the investment
performance and returns of the Vertex Funds pursuant to the Proposed Business
Combination, whether through the GPs of the Vertex Funds or otherwise. Similarly, none ofthe other LP interest holders of the Vertex Funds receives any benefits (monetary orotherwise), including carried interest, arising from the investment performance and returnsof the Vertex Funds pursuant to the Proposed Business Combination, whether through theGPs of the Vertex Funds or otherwise. There are no representatives from the Vertex Funds
and/or the Sponsor Group on the board of the Vendor. There are two representatives fromthe Vertex Funds on the board of the Target Company, but there are no representatives fromthe Sponsor Group on the board of the Target Company.

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If we are unable to complete the Proposed Business Combination with the Target
Company or another initial business combination by 20 January 2024 (unlessextended by 12 months as may be approved by Shareholders and SGX-ST, suchextension up to no more than 12 months and subject to an overall maximum timeframe of 36 months from Listing Date), the Company will be liquidated.
If we are unable to complete the Proposed Business Combination with the Target Company
or another initial business combination by 20 January 2024 (unless extended by 12 months
as may be approved by Shareholders and SGX-ST, such extension up to no more than
12 months and subject to an overall maximum time frame of 36 months from Listing Date),
the Company will have to cease all operations except for the purpose of winding up, redeem
all outstanding shares, and proceed to liquidation and dissolution in accordance with theMemorandum and Articles of Association. In such event, the proceeds held in the Escrow
Account could be subject to claims by third parties which could take priority over those ofyours as Shareholders which could result in you losing some or all of your investment.
If we are unable to complete the Proposed Business Combination with the Target Company
or another initial business combination by 20 January 2024 and we qualify for an extension
under the Listing Manual and receive the SGX-ST’s approval and Shareholders’ approval
for an extension, we may have up to no more than another 12 months from the relevant
deadline to complete the Proposed Business Combination (subject to an overall maximum
time frame of 36 months from the Listing Date). In other words, our Shareholders may beforced to wait for at least 24 months from the Listing Date (or such period as may be
extended pursuant to approvals from SGX-ST and our Shareholders, such extension up to
no more than 12 months and subject to an overall maximum time frame of 36 months fromthe Listing Date) before being allowed to redeem the Shares if we do not complete the
Proposed Business Combination with the Target Company or another initial businesscombination. In such case, our Shareholders may not receive the full amount of theirinvestment even in the event of a redemption or Liquidation and receive only S$5.00 per
Share (being the initial investment per Unit made by our Shareholders in the Offering as
100% of the gross proceeds raised from the Offering and issuance of the Cornerstone Unitsand Sponsor IPO Investment Units will be placed in the Escrow Account), or less than
S$5.00 per Share in certain circumstances (such as where investments made from theamounts in the Escrow Account diminish in value), on the redemption of their Shares, andour Warrants will expire worthless.
The Proposed Business Combination remains subject to conditions that we cannot
control and if such conditions are not satisfied or waived, the Proposed Business
Combination may not be consummated.
The Proposed Business Combination is subject to a number of conditions (as set out
Section 5.10 titled “Proposed Business Combination – Conditions Precedent” of thisCircular). There are no assurances that all conditions to the Proposed Business
Combination will be satisfied or that the conditions will be satisfied in the time frame
expected. If the conditions to the Proposed Business Combination are not met (and are notwaived, to the extent waivable), then either the Company or the Target Company may,subject to the terms and conditions of the Sale and Purchase Agreement, terminate the Saleand Purchase Agreement or amend the Long Stop Date.

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LETTER TO SHAREHOLDERS
Delays in completing the Proposed Business Combination may substantially reduce
the expected benefits of the Proposed Business Combination.
It may take longer and cost more than we expect to satisfy the conditions to the Completionof the Proposed Business Combination. Any delay in completing, or any additional
conditions imposed in order to complete, the Proposed Business Combination may
materially adversely affect the expected outlook of and benefits from the Proposed
Business Combination.
We may be targeted by derivative lawsuits that could result in substantial costs andmay delay or prevent the Proposed Business Combination from being completed.
Derivative lawsuits could be brought against us in connection with the Proposed Business
Combination and we may be required to incur substantial costs and exert management timeand resources in defending these claims, whether or not they have merit. Any adverse
judgment resulting in monetary damages could adversely affect our liquidity and financial
condition. Additionally, any adverse judgment resulting in an injunction prohibiting the
Proposed Business Combination may delay or prevent the Proposed Business Combinationfrom being completed within the expected timeframe, or at all, which may adversely affectour and the Target Group’s respective businesses, operational results, financial conditionand prospects.
Changes in laws or regulations, or a failure to comply with any laws and regulations,
may adversely affect the Company’s business, including its ability to negotiate andcomplete the Proposed Business Combination, operational results, financial
condition and prospects.
We are subject to laws and regulations enacted by national, regional and local
governments. Compliance with, and monitoring of, applicable laws and regulations may bedifficult, time-consuming and costly. Those laws and regulations and their interpretation andapplication may also change from time to time and those changes, as well as a failure tocomply with such laws and regulations, could have a material adverse effect on ourbusiness, operational results, financial condition and prospects.
16.4 Risks relating to Ownership of the Company’s Shares and Warrants following
Completion of the Proposed Transactions
Existing Shareholders will face immediate and substantial dilution following
Completion and may experience future dilution to shareholdings.
Completion will result in immediate dilution to the shareholding of existing Shareholders
from the allotment and issuance of the Consideration Shares to the Vendor (or if the Vendor
so nominates, to the Vendor Shareholders), the allotment and issuance of the PIPE Sharesto the PIPE Investors, and the allotment and issuance of the Special Bonus Shares to the
Non-Redeeming Shareholders and the PIPE Investors pursuant to the Proposed Business
Combination. Existing Shareholders may also face dilution after Completion arising fromthe allotment and issuance of the EIS Shares to the Key Executives, the allotment andissuance of the Earnout Shares to the Earnout Shareholders, the allotment and issuance of
the ESOP Shares in accordance with the Company ESOP and the vesting of the Promote
Shares. Please refer to Section 23.6 titled “Enlarged Group Corporate and Shareholding
Structure – Dilution Effect Resulting from the Proposed Transactions and the Exercise of
the Warrants” of this Circular for further details.
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In addition, following Completion, it is possible that the Enlarged Group may require further
funding in order to grow and expand its operations. Under such circumstances, secondary
issue(s) of securities may be necessary to raise the required capital to develop thesegrowth opportunities. If new Shares are issued and placed to new and/or existing
Shareholders, they may be priced at a discount to the then prevailing market price ofShares trading on the SGX-ST, in which case existing Shareholders’ equity interest will be
diluted. If the Enlarged Group fails to utilise the new equity to generate a commensurateincrease in earnings, the EPS of the Enlarged Group will be diluted and this could lead toa decline in the market prices of its Shares.
Warrants will become exercisable after Completion of the Proposed Business
Combination and result in dilution to Shareholders.
Investors may experience a dilution of their percentage ownership if they do not exercise
their Warrants or if other investors exercise their Warrants. The terms of the Warrants
provide, among others, for the issue of Shares in the Company upon any exercise of theWarrants, in each case in accordance with their respective terms. For further details on theterms of the Warrants, please refer to Section 29.2 titled “Material Contracts – The
Company – Warrant Agreement” of this Circular. Based on the 12,481,799 Public Warrants
and 16,000,000 Private Placement Warrants outstanding as at the Latest Practicable Date,
if all Warrants (including the Private Placement Warrants) were exercised, this would resultin a maximum dilution of approximately 5.6% of our Enlarged Share Capital.
Notwithstanding that investors may choose not to exercise their Warrants, their
proportionate ownership and voting interest in us could in any case be reduced by the issueof Shares pursuant to the terms of the Warrants. The exercise of the Warrants, including byother Warrantholders, will result in a dilution of the value of such investors’ interests if thevalue of a Share exceeds the Warrant Exercise Price at the relevant time. The potential forthe issue of additional Shares pursuant to the exercise of the Warrants could have an
adverse effect on the market price of the Shares. There is no assurance that the Warrants
will be “in the money” prior to their expiration or that the holders of the Warrants will
exercise their Warrants.
No prior market for the Shares on an Enlarged Group basis exists.
The Shares have never been traded on the SGX-ST on an Enlarged Group basis. As such,there can be no assurance that an active trading market for the Shares will develop or, if
developed, will be sustained.
Although we have received the SGX-ST’s approval-in-principle for the listing of andquotation for the Consideration Shares, the Earnout Shares, the EIS Shares, the ESOP
Shares and the Special Bonus Shares on the Mainboard of the SGX-ST, this should not betaken as an indication of the merits of the Proposed Business Combination, the Enlarged
Group or the Shares. The Offering Price of the Shares may not be indicative of prices thatwill prevail in the trading market. You may not be able to resell the Shares at the Offering
Price or at a price that is attractive to you. The trading prices of the Shares could be subject
to fluctuations in response to variations in the operational results of the Enlarged Group,changes in general economic conditions, changes in accounting principles or otherdevelopments affecting the Enlarged Group, its customers or competitors, changes infinancial estimates by securities analysts, the operating and stock price performance ofother companies and other events or factors, many of which are beyond our control.
Volatility in the price of the Shares may be caused by factors outside of our control or may
be unrelated or disproportionate to the operational results of the Enlarged Group. An
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inactive market may also impair the ability of the Enlarged Group to raise capital by selling
Shares, attract and motivate its personnel through equity incentive awards. Although it iscurrently intended that the Shares will remain listed on the SGX-ST, there is no guaranteeof the continued listing of our Shares. If the Shares are no longer listed on the SGX-ST,
there may be no active or liquid market for the Shares.
Future issuances of the Enlarged Group’s Shares may not be available to existing
Shareholders.
Should the Enlarged Group issue new Shares in the future, it will not be obligated to offer
those Shares to existing Shareholders, except in a rights issue, preferential offering, bonus
issue and scrip dividends, among others. The Enlarged Group will have discretion inelecting the method of issuance of new Shares and may be subject to the general mandate
threshold, which may affect its ability to make the Shares available to its existing
Shareholders.
Accordingly, existing Shareholders may be unable to participate in future offerings of new
Shares and may experience dilution to their shareholding interests as a result. In addition,
the Company may also issue new Shares or convertible securities, share options or shareawards under any employee share schemes that are currently in place or may be
implemented after Completion. This may lead to further dilution to the shareholdings of theexisting Shareholders.
Future sale of securities by the Vendor may adversely affect the price of the Shares.
Following Completion, the Vendor Shareholders will hold approximately 77.2% of theEnlarged Share Capital upon Completion (assuming that there is No Redemption and thatthe total proceeds raised from the PIPE Financing is S$10.0 million) and approximately
91.5% of the Enlarged Share Capital upon Completion (assuming that there is Maximum
Redemption and that the total proceeds raised from the PIPE Financing is S$10.0 million).
A significant portion of Vendor Shareholders are not subject to a moratorium and are free
to trade their Consideration Shares immediately upon Completion. Any sale of a significant
number of such Consideration Shares could materially and adversely affect the market
price of the Shares. Furthermore, although the Consideration Shares held by certain
Vendor Shareholders will be subject to a moratorium (the details of which are set out in
Section 23.7 titled “Enlarged Group Corporate and Shareholding Structure – Moratorium” ofthis Circular), any sale of a significant number of such Shares after expiration of theapplicable moratorium period or any permitted sale during the applicable moratorium periodby the Vendor Shareholders, or the perception that such sales may occur, could materiallyand adversely affect the market price of the Shares and may thereby also affect the
Enlarged Group’s ability to raise funds through the issue of equity or other forms of
securities. These factors may also affect the Company’s ability to attract subscriptions for
additional equity securities in the future, at a time and price the Company deems
appropriate.
The Enlarged Group may not be able to successfully execute the Company’s plans.
The future plans for the Company are as described in Section 15 titled “Prospects, Business
Strategies and Future Plans” of this Circular. No assurance can be given that the Enlarged
Group will be able to successfully execute these plans. It is also not possible to predict withcertainty, the length of time that may be needed to successfully execute these plans. Until
such time that the plans described above are successfully executed, the aforementioned
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liabilities and other liabilities of the Company will remain within the Enlarged Group, andsuch liabilities would continue to require cost, resources and attention of the managementof the Enlarged Group.
The Enlarged Group may not be able to pay dividends.
There is no assurance that the Company will pay dividends in the future or, if the Company
does pay dividends in the future, when the Company will pay them. The declaration andpayment of future dividends will depend upon, inter alia, the Enlarged Group’s actual andfuture financial performance and financial condition, level of cash and retained earnings,
current capital commitments, projected capital expenditure and other investment plans, theterms of the borrowing arrangements (if any), future plans for expansion, and any otherfactors which the Proposed New Board may deem appropriate. This may be affected bynumerous factors including but not limited to general economic conditions, market
sentiment, market competition and the success of the Enlarged Group’s future plans andbusiness strategies, many of which are beyond the Enlarged Group’s control. As such, there
is no assurance that the Enlarged Group will be able to pay dividends to its Shareholders
after Completion. For further details on the dividend policy of the Enlarged Group, pleaserefer to Section 28.3 titled “Dividend Policy – The Enlarged Group” of this Circular.
Further, companies in the Enlarged Group may enter into loan agreements in the future,
which contain covenants that may limit when and how much dividends the companies in the
Enlarged Group can declare and pay. There is no assurance that the Enlarged Group will
be able to obtain the approval of the relevant lenders for the declaration and payment ofdividends, and there is therefore no assurance that the Enlarged Group will be able todeclare and pay dividends after Completion.
The price of the Shares may fluctuate or decline following Completion.
The Issue Price of the Consideration Shares allotted and issued in relation to the Proposed
Business Combination may not be indicative of the price of the Shares that will prevail in the
trading market. The market price of the Shares may fluctuate significantly and rapidly as aresult of, amongst other things, the following factors, some of which are beyond the controlof the Enlarged Group:(a)the success or failure of the Enlarged Group’s management team in implementing
business and growth strategies;(b)announcements by the Enlarged Group of significant contracts, acquisitions, strategic
partnerships or capital commitments;(c)loss of the Enlarged Group’s major customers or suppliers (including popular live
streamers, V-Livers and users);(d)any negative publicity on the Enlarged Group or any of its Proposed Directors,
Proposed Executive Officers, Substantial Shareholders, business partners, customers
and suppliers (including popular live streamers, V-Livers and users), whether or notthey are justified;(e)involvement by the Enlarged Group in material litigation, arbitrations proceedings
and/or investigations by government authorities;

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unforeseen contingent liabilities of the Enlarged Group;(g)additions or departures of key personnel of the Enlarged Group;(h)loss of an important business relationship or adverse financial performance by asignificant customer or group of customers;(i)changes in securities analysts’ estimates of the Enlarged Group’s financial
performance and recommendations;(j)changes in conditions affecting the industry, the general economic conditions or stock
market sentiments or other events or factors;(k)differences between the Enlarged Group’s actual financial operating results and those
expected by investors and securities analysts;(l)changes in market valuations and share prices of companies with businesses that are
similar to those of the Enlarged Group that may be listed in Singapore or elsewhere;(m) variation in the operational results of the Enlarged Group;(n)changes in general market conditions and broad market fluctuations; and(o)foreign exchange fluctuations and translations.

In addition, the market price of the Shares may decline as a result of the Completion of the
Proposed Business Combination if (a) the Company does not achieve the perceived
benefits of the Proposed Business Combination as rapidly as, or to the extent anticipatedby, Shareholders or securities analysts; or (b) the effect of the Proposed Business
Combination on the Enlarged Group’s financial statements is not consistent with the
expectations of Shareholders or securities analysts.
Accordingly, Shareholders may experience a loss as a result of the decreasing market priceof the Shares.
16.5 Risks relating to Redemption of VTAC Shares and Warrants
Investors may experience dilution resulting from the exercise of the Redemption
Right by other Shareholders in connection with the Proposed Business Combination.
Our Shareholders (save for Vertex SPV and Venezio) may redeem all or a portion of their
Shares upon Completion of the Proposed Business Combination at a per-Share price equal
to the Redemption Price. Prior to the Completion of the Proposed Business Combination,
we will not know how many Shareholders will exercise their Redemption Right. If asignificant number of Shares are submitted for Redemption, there may be a risk that
Shareholders that remain invested in us (or the Resulting Issuer) will experience dilution,such dilution being the difference between the adjusted NAV per Share arising from the
Redemption and the NAV per Share just before such Redemption. In addition to dilution,
there will be less cash available at the Completion of the Proposed Business Combination.

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We may redeem your unexpired Warrants prior to their exercise at a time that is
disadvantageous to you.
We have the ability, at our option, to redeem all (and not part of) the outstanding Warrants
at any time after they become exercisable and prior to their expiration, for cash at any time
during the 30-day Redemption Period and any Warrants outstanding as at the Warrant
Redemption Date shall be redeemed and settled on a “cashless basis” (wherein the number
of Redemption Shares to be received upon redemption shall be the product of Warrants
held by such Warrantholder, multiplied by 0.361 (rounded down to the nearest whole
number of Redemption Shares)), provided that the Reference Value of our Shares equals
or exceeds S$9.00 per Share (subject to adjustments in compliance with the Warrant
Conditions). Redemption of the outstanding Warrants could force you to (i) exercise yourWarrants and pay the exercise price therefor at a time when it may be disadvantageous foryou to do so or (ii) sell your Warrants at the then-current market price when you mightotherwise wish to hold your Warrants. In addition, given that the stipulated ratio of 0.361
Redemption Share for each Warrant redeemed and settled on a “cashless basis” is fixed(regardless of any adjustments to the Warrant Exercise Price of the Warrants as there will
be a corresponding and proportionate adjustment to the redemption trigger price inaccordance with the Warrant Conditions), there may be limited upside for Warrantholders
in the event their Warrants are redeemed by us as such Warrantholder would not receive
any incremental gain on their investment even where the Reference Price exceeds S$9.00.
None of the Private Placement Warrants will be redeemable by us if at the time of theredemption such Private Placement Warrants continue to be held by the original purchasers
thereof or any of their Permitted Transferees, and have not yet been transferred (other thanto Permitted Transferees).
If a Shareholder fails to comply with the procedures to redeem our Shares inconnection with the Proposed Business Combination, such Shares may not be
redeemed.
If a Shareholder fails to adhere to the Redemption processes and mechanisms set out inthis Circular, the Memorandum and Articles of Association or in any relevant document inrespect of the Proposed Business Combination in order to validly redeem the Shares, such
Shareholder’s Shares may not be redeemed and they may not be able to recover all or partof their initial investment.
17.

SELECTED FINANCIAL INFORMATION OF THE TARGET GROUP
The following selected financial information of the Target Group should be read in
conjunction with the full text of this Circular, including Section 18 titled “Management’s
Discussion and Analysis of Financial Position and Results of Operations of the Target
Group” of this Circular, the “Independent Auditor’s Report and Audited Consolidated
Financial Statements of the Target Group for the financial years ended 31 December 2020,2021 and 2022” as set out in Appendix A to this Circular, the “Interim Consolidated Financial
Statements of the Target Group for the Six-Month Period Ended 30 June 2023” as set out
in Appendix B to this Circular and the “Unaudited Pro Forma Consolidated Financial
Information of the Enlarged Group for the Financial Year Ended 31 December 2022 and the
Six-Month Period Ended 30 June 2023” as set out in Appendix C to this Circular.

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LETTER TO SHAREHOLDERS
This Circular contains the audited consolidated financial statements for the financial years
ended 31 December 2020, 2021 and 2022 of the Target Group, the unaudited interim
consolidated financial statements for the six months ended 30 June 2022 and 30 June 2023of the Target Group, the unaudited proforma financial information for the financial years
ended 31 December 2020, 2021 and 2022 of the Target Group and the unaudited proforma
financial information for the financial year ended 31 December 2022 and the six months
ended 30 June 2022 and 30 June 2023 of the Target Group, together with the related notes
thereto, each of which has been prepared in accordance with the IFRS.
A summary of the financial information of the Target Group during the Period Under Review
is set out below:
Results of Operations of the Target GroupFY2020

FY2021(Audited)(Audited)

FY2022

1H FY2023(Audited)(Unaudited)

US$
Operating revenue

411,360,430

497,782,292

363,717,850

150,984,528

Cost of revenue(236,001,310) (310,035,338) (237,568,755)(87,925,616)

Gross profit

175,359,120

187,746,954

126,149,095

63,058,912

Selling expenses(97,079,510) (129,179,652)(64,310,830)(24,315,104)

General and administrative
expenses(49,786,248)(31,592,573)(24,402,012)(12,219,602)

Research and development
expenses(4,072,531)(16,609,117)(27,312,262)(13,517,949)(150,938,289) (177,381,342) (116,025,104)(50,052,655)

Operating expenses

Total operating expenses
Operating income

24,420,831

10,365,612

10,123,991

13,006,257– Revaluation (loss)/gain on
financial liabilities(59,105,881)

112,407,180(55,860,150) (127,649,235)– Others(12,554,312)(2,790,961)(71,660,193)

109,616,219(974,233)(743,168)

Non-operating income andexpenses
Other gains and losses

Finance costs

209

3,045,118(638,459)(52,815,032) (128,287,694)(171,948)(53,763)

LETTER TO SHAREHOLDERS
FY2020

FY2021(Audited)(Audited)

FY2022

1H FY2023(Audited)(Unaudited)

US$
Total non-operating
income and expenses(72,634,426)

108,873,051(52,986,980)(128,341,457)(Loss)/profit before
income tax(48,213,595)

119,238,663(42,862,989)(115,335,200)(5,286,793)(9,727,770)(8,153,842)(2,909,563)(53,500,388)

109,510,893(51,016,831)(118,244,763)

1,552,129–––(51,948,259)

109,510,893(51,016,831)(118,244,763)(211,943)(2,976,784)(3,951,456)(1,210,349)

Change in credit risk offinancial liabilities at fair value
through profit or loss

(175,000)(19,500)

700(20,700)

Other comprehensive income
for the period/year, net of tax(386,943)(2,996,284)(3,950,756)(1,231,049)

Total comprehensive income
for the period/year(52,335,202)

106,514,609(54,967,587)(119,475,812)– continuing operations(53,490,390)

109,510,893(51,016,831)(118,244,763)– discontinued operations

1,552,129–––(9,998)–––(51,948,259)

109,510,893(51,016,831)(118,244,763)

Income tax expense(Loss)/profit for theperiod/year from continuing
operations
Profit for the period/year fromdiscontinued operations(Loss)/profit forthe period/year
Other comprehensive
income:Items that may be reclassified
to profit or loss
Foreign currency translation
Items that will not bereclassified to profit or loss

(Loss)/income attributable to:
Owners of the Company

Non-controlling interests– continuing operations

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LETTER TO SHAREHOLDERS
FY2020

FY2021(Audited)(Audited)

FY2022

1H FY2023(Audited)(Unaudited)

US$
Total comprehensive income
attributable to:– continuing operations(51,906,485)

106,514,609(54,967,587)(119,475,812)(428,717)–––(52,335,202)

106,514,609(54,967,587)(119,475,812)– continuing operations(1.05)

3.31(1.35)(3.12)– discontinued operations

0.03

–

–

–

Basic earnings per share (1)(1.02)

3.31(1.35)(3.12)– continuing operations(1.05)(0.01)(1.35)(3.12)– discontinued operations

0.03

–

–

–

Diluted earnings per share(1.02)(0.01)(1.35)(3.12)– discontinued operations

Basic earnings per share
Owners of the Company

Adjusted earnings per share
Diluted earnings per share
Owners of the Company

Note:(1) For illustrative purposes, the EPS for the Period Under Review have been computed based on the Target
Group’s (loss)/profit attributable to owners of the Company for each financial year and the Target Company’s
weighted average number of shares of 51,133,758 shares for financial year 31 December 2020, 33,047,738
shares for financial year ended 31 December 2021, and 37,923,882 shares for financial year ended
31 December 2022 and for the six-month period ended 30 June 2023.

Financial Position of the Target GroupFY2020

FY2021(Audited)(Audited)

FY2022

1H FY2023(Audited)(Unaudited)US$
ASSETS
Non-current assets
Property, plant and equipment

1,686,922

2,017,633

795,789

1,186,719

Right-of-use assets

8,688,274

8,114,534

1,848,265

3,405,201

Intangible assets

30,529,783

28,424,508

26,543,128

25,188,892

Deferred tax assets

3,169,184

2,194,774

1,537,813

2,302,375

Guarantee deposits

3,403,741

3,645,149

3,696,046

3,490,677

Total non-current assets

47,477,904

44,396,598

34,421,041

35,573,864

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LETTER TO SHAREHOLDERS
FY2020

FY2021(Audited)(Audited)

FY2022

1H FY2023(Audited)(Unaudited)

US$
Current assets
Prepaid operating expenses

1,473,165

4,457,704

3,369,559

2,581,499

Financial assets at fair value
through profit or loss

144,745

108,813––

1,277,185

2,433,266

2,325,918

751,940

Trade and other receivables (2)32,678,926

34,243,046

24,053,674

20,551,791

Cash and cash equivalents

92,491,374

59,090,846

39,259,309

39,865,932

Total current assets

128,065,395

100,333,675

69,008,460

63,751,162

Total assets

175,543,299

144,730,273

103,429,501

99,325,026

Trade and other payables

89,624,295

82,752,531

59,043,917

47,259,978

Contract liabilities

8,032,045

9,982,872

7,273,934

6,860,310

821,000

295,000

211,102,456

1,023,000

Income tax payable

12,628,013

12,043,085

5,255,771

3,415,305

Lease liabilities

2,260,100

2,639,683

920,219

1,614,677

Loans and borrowings

Other current assets(1)

LIABILITIESCurrent liabilities

Financial liabilities at fair value
through profit or loss (3)(4)5,696,687

1,164,988

–

–

(5)

775,918

1,630,178

893,360

855,409

Other current liabilities

129,817

201,020

106,744407,506

Total current liabilities

119,967,875

110,709,357

284,596,401

61,436,185(10,375,682) (215,587,941)

2,314,977

Provisions

Net current assets/(liabilities)

8,097,520

Non-current liabilities
Financial liabilities at fair value
through profit or loss

278,664,192

154,948,006–

337,749,391

Loans and borrowings

1,161,649–––

Deferred tax liabilities

1,939,550

1,406,024

855,590329,955

Lease liabilities

7,423,678

6,429,734

1,012,263

1,772,991

223,135

308,592

164,036

359,504

Total non-current liabilities

289,412,204

163,092,356

2,031,889

340,211,841

Total liabilities

409,380,079

273,801,713

286,628,290

401,648,026

Provisions

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LETTER TO SHAREHOLDERS
FY2020

FY2021(Audited)(Audited)

FY2022

1H FY2023(Audited)(Unaudited)

US$
EquityShare capital

2,876

3,792

3,792

3,792

Share premium

21,383,500

25,409,440

25,409,440

25,409,440

Other reserves

8,959,154

1,100,037(2,010,481)(2,889,929)

Accumulated deficit(264,182,310) (155,584,709) (206,601,540) (324,846,303)

Total equity(233,836,780) (129,071,440) (183,198,789) (302,323,000)

Total liabilities and equity

175,543,299

144,730,273

103,429,501

99,325,026

Notes:(1) In 2020, US$66,222 was advanced to a live streamer for penalty expenses for his/her departure from anotherplatform, which the Target Group had agreed to bear in connection with its acquisition of the live streamer.
The dispute was resolved in 2021.
(2) In 2020, US$81,651 was lent to employees. These loans were interest-free, unsecured (i.e. did not require
collateral from the employees) and repayable on demand. These loans were fully repaid in 2021. The Target
Group may provide loans to employees should there be a request in exceptional circumstances, which will beapproved on a case-by-case basis.
(3) The fair value of financial liabilities was determined using the market approach, making reference to thetransaction price of the Target Group’s most recent round of pre-listing investment and taking into
consideration factors such as market volatility. The change in the financial liabilities at fair value through profit
and loss during the Period Under Review was primarily attributable to the then market volatility.
(4) Please refer to Note 22 to Appendix A titled “Independent Auditor’s Report and Audited Consolidated Financial
Statements of the Target Group for the Financial Years Ended 31 December 2020, 2021 and 2022” of thisCircular for further details.
(5) The changes in provisions from FY2021 to FY2022 are primarily attributable to the changes in provisions for
VAT penalties. In FY2021, the Target Group had made a provision for VAT penalties in the amount of
US$722,540. The VAT audit was completed by the tax authority in FY2022 and therefore the provision for VAT
penalties in FY2022 was reduced to US$130,252.

Cash FlowFY2020

FY2021(Audited)(Audited)

FY2022

1H FY2023(Audited)(Unaudited)

US$
Cash flows from operating
activities(Loss)/profit before income tax
from continuing operations(48,213,595)

119,238,663(42,862,989)(115,335,200)

Profit before income tax fromdiscontinued operations

1,552,129–––

Expected credit losses

652,863

516,189––

Impairment of goodwill

10,594,732

–

–

–

Impairment of otherintangible assets

1,708,445–––

Adjustments for:213

LETTER TO SHAREHOLDERS
FY2020

FY2021(Audited)(Audited)

FY2022

1H FY2023(Audited)(Unaudited)

US$
Gain on disposal ofsubsidiaries(1,292,787)

–

–

–

Loss on repurchase ofpreference shares–

2,708,549––

Depreciation expense

2,709,947

2,868,002

2,590,617

1,053,772

Amortisation expense

3,176,250

2,217,357

2,300,960

1,333,837

414,804

197,391

995,365

339,744

Share-based payments

2,988,723

1,923,761

840,238

351,601

Revaluation loss/(gain) on
financial liabilities

59,105,881(112,407,180)

55,860,150

127,649,235

Finance costs

974,233

743,168

171,948

53,763

Loss/(gain) on termination ofleases80,350–(338,996)(3,942)

Professional fees in relation
to the Proposed Business
Combination

–

–

–

1,534,899

34,451,975

18,005,900

19,557,293

16,977,709

Trade and other receivables(19,820,226)(2,014,087)

10,189,372

3,501,883

Prepaid operating expenses(168,625)(2,984,539)

1,088,145

788,060

Other current assets

990,789(1,222,303)

107,348

1,573,97850,627,470(6,871,764)(23,708,614)(13,318,838)

Other current liabilities(768,638)

71,203(94,276)

300,762

Contract liabilities

1,397,341

1,950,827(2,708,938)(413,624)

730,569

939,717(881,374)(37,951)

67,440,655

7,874,954

3,548,956

9,371,979

Interest paid

(564,621)(398,700)(4,583)–

Income tax paid

(156,886)(10,388,203)(14,008,601)(5,383,534)

66,719,148(2,911,949)(10,464,228)

3,988,445

Decrease/(increase) in
financial assets at fair value
through profit or loss

(144,745)

35,932

108,813–Purchase of property, plantand equipment(1,475,026)(1,051,686)(438,061)(964,143)

Loss on disposal of property,
plant and equipment

Operating cash flows beforechanges in working capital
Changes in working capital

Trade and other payables

Provisions
Cash flows from operations

Net cash flows from/(usedin) operating activities
Investing activities

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LETTER TO SHAREHOLDERS
FY2020

FY2021(Audited)(Audited)

FY2022

1H FY2023(Audited)(Unaudited)

US$
Purchase of intangible assets(206,551)(118,393)(467,858)–

Decrease/(increase) inguarantee deposits

711,818(241,408)(50,897)

205,369

Acquisition of a subsidiary

3,889,743–––

Disposal of subsidiaries

668,886–––

3,444,125(1,375,555)(848,003)(758,774)

Proceeds from issuance ofpreference shares

28,100,000

–

–

–

Proceeds from issuance of
warrants

328,000–––

Repayments of principal
portion of lease liabilities(1,095,629)(2,348,051)(2,854,123)(739,698)

Proceeds from loans andborrowings

6,672,000–––

Repayment of loans andborrowings(705,277)(5,833,334)(1,166,666)–(32,748,923)(1,838,953)––

Repurchase of restricted
share units(490,450)(1,834,077)––

Repurchase of preference
shares–(14,563,055)––

Interest paid

(181,480)(202,422)(164,210)(51,684)

Net cash flows used infinancing activities(121,759)(26,619,892)(4,184,999)(791,382)

70,041,514(30,907,396)(15,497,230)

2,438,289

685,208(2,493,132)(4,334,307)(1,831,666)

Cash and cash equivalents at
beginning of financial year

21,764,652

92,491,374

59,090,846

39,259,309

Cash and cash equivalents
at end of financial period/
year

92,491,374

59,090,846

39,259,309

39,865,932

Net cash flows from/(usedin) investing activities
Financing activities

Repurchase and retirement ofordinary shares

Net increase/(decrease) incash and cash equivalents
Net foreign exchange
difference

215

LETTER TO SHAREHOLDERS
18.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND
RESULTS OF OPERATIONS OF THE TARGET GROUP
The following discussion and analysis of the Target Group’s financial condition and resultsof operations should be read in conjunction with “Selected Financial Information of The
Target Company” and the Target Group’s consolidated financial statements and the related
notes thereto, each included elsewhere in this Circular. In addition to historical consolidated
financial information, the following discussions contain forward-looking statements thatreflect the Target Group’s plans, estimates, and beliefs that involve risks and uncertainties.
The Target Group’s actual results and the timing of selected events could differ materiallyfrom those anticipated in the forward-looking statements as a result of many factors,
including those set forth under “Risk Factors” and elsewhere in this Circular. The Target
Group’s Audited Consolidated Financial Statements for FY2020, FY2021 and FY2022 are
prepared and presented in accordance with IFRS. A review of the interim financial
information for 1H FY2022 has been included as comparative figures in the consolidated
financial statements for 1H FY2023.
Any discrepancies in the tables included herein between the listed amounts and 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.

18.1 Overview
The Target Group operates the top pure-play live streaming platform in Japan with a market
share by revenue of 20.8% for 2022 and commands a significant market share by revenueof 26.9% in Taiwan for 2022, according to the IMR Consultant. The Target Group had an
average MAU of approximately 550,000 globally in 1H FY2023 and approximately 87,000
Contracted Streamers as of 30 June 2023.
The Target Group’s business is broadly categorised into the Liver live streaming, V-Liverlive streaming and other businesses. Please refer to Section 14.3 titled “Information on theTarget Company – Business Overview” of this Circular for further details.
Liver live streaming
The Target Group launched its flagship product, 17LIVE, in Taiwan in July 2015, andsubsequently in Japan in August 2017.
Complementary to its Liver live streaming offerings, the Target Group also launched in-app
games on 17LIVE in Taiwan and Japan in May 2022 and August 2022 respectively, and has
continued to expand its in-app game offerings and introduce more in-app game interactive
features in both the Liver and V-Liver live streaming offerings.
The Target Group’s operating revenue from Liver live streaming was US$406.9 million,
US$489.7 million, US$354.6 million, US$195.6 million and US$146.0 million for FY2020,
FY2021, FY2022, 1H FY2022 and 1H FY2023 respectively.

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LETTER TO SHAREHOLDERS
V-Liver live streaming
In 2018, the Target Group introduced V-Liver content as a genre on 17LIVE, which arecomputer-generated characters designed to represent real people, using motion capture
technology to capture the movements, sounds and expressions of the human actors to bereflected on the V-Livers. The Target Group further expanded its V-Liver broadcasting
functionality by integrating the Live2D functions on 17LIVE in April 2023, which allows users
to use their smartphones to upload an avatar and conduct virtual streaming without any
additional hardware or software, thereby significantly lowering the barriers to becoming a
V-Liver.
The Target Group’s operating revenue from V-Liver live streaming was US$2.9 million,
US$3.3 million, US$3.1 million, US$1.9 million and US$1.5 million for FY2020, FY2021,
FY2022, 1H FY2022 and 1H FY2023 respectively.
Other businesses (Live commerce and Wave)
Since 2019, the Target Group has operated its live commerce business through HandsUp,
a platform that allows merchants to sell their products through live streaming in Japan, andOrderPally, a B2B live commerce matching and order management SaaS platform
connecting merchants and users in Taiwan.
The Target Group also operates Wave, an audio-centric live streaming and social platform,
which was launched in Taiwan in 2018 and was subsequently introduced to Japan in 2022.
The Target Group’s operating revenue from other businesses was US$1.5 million, US$4.7
million, US$6.0 million, US$3.0 million and US$3.4 million for FY2020, FY2021, FY2022,
1H FY2022 and 1H FY2023 respectively.
18.2 Factors Affecting the Target Group’s Results of Operations
The Target Group’s business and operating results are affected by general factors affecting
the live social entertainment industry in markets in which it operates, including
macroeconomic trends such as an increasing GDP per capita in Asia, increasing number ofsmartphone users and internet penetration rate, increasing personal entertainment spend
as a proportion of total income, shift in consumer behaviour and preferences to consume
digital content, growth of the live social entertainment market and governmental policies
and initiatives affecting the live social entertainment industry and growth of other forms of
online entertainment.
The Target Group believes that its results of operations are also more directly affected byfactors specific to the Target Group, including the Target Group’s ability to:•

grow its user base and enhance user engagement;•

attract and retain popular live streamers and enrich the quality of its content offerings;•

effectively develop and improve technology infrastructure;•provide effective customer service to attract and retain users;•

effectively acquire and utilise V-Liver proprietary IP and related technologies;
217

LETTER TO SHAREHOLDERS•

effectively implement omni-marketing strategies and organise offline events;•

effectively implement its monetisation strategies to generate sustainable revenue andprofits;•

manage its costs and expenses; and•maintain its position in core markets and successfully expand into and adapt to newmarkets.

Please refer to Section 14.3 titled “Information on the Target Company – Business
Overview” of this Circular for further details.
18.3 Key Components of the Statements of Profit or Loss and Comprehensive Income of
the Target GroupOperating Revenue
In the Period Under Review, the Target Group derived its operating revenue primarily fromliver live streaming services, V-Liver live streaming services and other businesses. The
following table sets forth a breakdown of the Target Group’s operating revenue by businesssegment in amount and as a percentage of its total operating revenue for the periods
indicated:
FY2020

FY2021

FY2022

1H FY2022

1H FY2023

US$’000%

US$’000%

US$’000%

US$’000%

US$’000%

Liver Live
Streaming

406,89998.9

489,70798.4

354,587

97.5

195,61197.6

146,038

96.7

V-Liver Live
Streaming(1)

2,914

0.7

3,326

0.7

3,107

0.9

1,854

0.9

1,545

1.0

Other
Businesses(2)

1,548

0.4

4,749

0.9

6,024

1.7

2,957

1.5

3,402

2.3

411,360

100.0

497,782

100.0

363,718

100.0

200,421100.0

150,985

100.0

Operating
Revenue:

Total
Notes:(1) In-app games are available in Liver live streaming and V-Liver live streaming offerings but due to current
technical limitations, as of the Latest Practicable Date, the operating revenue which the Target Groupgenerates from in-app games in V-Liver live streaming offerings has been consolidated into the businesssegment of Liver live streaming. The Target Group aims to have data infrastructure in place to track theoperating revenue which the Target Group generates from in-app games in Liver live streaming and V-Liverlive streaming offerings separately starting from 2024.
(2) Other businesses include live commerce and Wave.

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LETTER TO SHAREHOLDERS
The following table sets forth a breakdown of the Target Group’s operating revenue bygeographic markets for the periods indicated. The Target Group’s operating revenue ispredominantly derived from Japan and Taiwan, comprising an aggregate of 94.1% of theTarget Group’s total operating revenue in 1H FY2023.
FY2020

FY2021

FY2022

1H FY2022

1H FY2023

US$’000%

US$’000%

US$’000%

US$’000%

US$’000%

Japan

285,84169.5

364,87873.3

251,92769.3

140,198

70.0

103,852

68.8

Taiwan71,023

17.3

86,735

17.4

86,83023.9

44,88922.4

38,21625.3

Rest of theWorld

54,49613.2

46,1699.3

24,961

6.9

15,335

7.6

8,916

5.9

Total

411,360

100.0

497,782

100.0

363,718

100.0

200,421100.0

150,985

100.0

Operating
Revenue:

Liver Live Streaming and V-Liver Live Streaming Revenues
The Target Group’s operating revenue is affected by Spend Rate and ARPPU.
The Target Group’s live streaming revenues comprise revenues from (i) virtual gifting,(ii) subscription, and (iii) in-app games. Revenues are generated through virtual points that
the Target Group sells to its users, which the users can exchange for virtual gifts. The Target
Group first introduced the V-Liver live streaming segment in 2018. Since 2022, in line withits business growth plans, the Target Group began tracking and focusing on thedevelopment of its V-Liver live streaming business.
Virtual Gifting Revenues. The Target Group generates substantially all of its operating
revenue through sales of virtual points to its users to exchange for virtual gifts presented
to Livers and V-Livers during live streams. Virtual gifts can be exchanged using virtual
points at different prices and virtual points can be purchased on 17LIVE in different
packages, which can cost users anywhere from approximately US$1 to US$30,000. Pleaserefer to Section 14.3 titled “Information on the Target Company – Business Overview – The
Target Group’s Business Lines – Live Streaming – Gifting” of this Circular for further details.
Both Liver and V-Liver live streaming virtual gifts are consumable virtual gifts that the users
can present to live streamers and V-Livers to express appreciation and support.
Accordingly, revenues from the sale of virtual points are first recorded as contract liabilities
and are recognised as revenues upon conversion of virtual points to virtual gifts and gifted
to live streamers or V-Livers based on the contract location of the live streamers andV-Livers. Virtual points can be sold in bundled packages, and the sale price is proportionallyallocated to each virtual point based on the total package price, and recognised as revenue
upon utilisation. The Target Group does not have further obligations to the users
immediately after the consumable virtual gifts are consumed or after the effective period fortime-based virtual items expires. As of the Latest Practicable Date, virtual points purchasedby users in Japan will only be valid for one year. This one-year validity period of thepurchased virtual points only applies to virtual points purchased by users in Japan – this is
primarily due to certain depository requirements under the PSA. Upon the expiration of theunused virtual points, restricted deposits representing such expired virtual points may bereleased to form part of the Target Group’s working capital. The one-year validity period
does not apply to virtual points purchased by a user outside of Japan because there is no219

LETTER TO SHAREHOLDERS
such statutory depository restriction in other applicable jurisdictions. In order to continue
producing appealing content to attract and retain user traffic, the Target Group shares
revenues with live streamers and V-Livers in accordance with its revenue sharing
arrangements. The portion of revenue shared with live streamers and V-Livers is accounted
for as the Target Group’s cost of revenue. If virtual points are provided to users free ofcharge for marketing purposes, although the live streamers and V-Livers receive
remuneration from virtual gifts redeemed from such free virtual points (which will be basedon the same pre-agreed revenue sharing percentage as for the virtual gifts redeemed frompaid virtual points), the Target Group does not recognise any revenue when users convert
these free virtual points to virtual gifts. When providing free virtual points, the Target Grouptags and tracks the free virtual points and how they are spent. Such free virtual points arevalid for one year, and the Target Group has no further obligations to the user after it
expires.
Users purchase virtual points, which are stored in their wallets, and use those virtual points
to redeem for virtual gifts as appreciation for the streamers. The streamers receive virtual
points in their wallets equivalent to the value of the virtual gifts they received. Virtual points
can only be used once and cannot be used multiple times. While a “user” can be both a user
and a streamer using the same account on 17LIVE, the wallet containing the virtual points
that he/she has purchased as a user is separate from the wallet containing the virtual points
that he/she has received as a streamer.
Subscription Revenues. The Target Group generates a portion of its revenues fromsubscription fees paid by users on a monthly basis for value-added and exclusive services
such as the options to join the fan group of their preferred live streamers and V-Livers,
becoming part of the live streamers’ and V-Livers’ core community (i.e. becoming an “armysubscriber”) and enjoy exclusive fan group streaming. The subscription fee is collected
upfront from subscribers. The receipt of the revenue is initially recorded as contract
liabilities and revenue is recognised over the period of the subscription. The membershipsubscription does not include elements of discount or bundled sales.
In-app Games Revenues. The Target Group also generates a small portion of its operating
revenue from sales of virtual points used to play in-app games available on its platforms
complementary to live streaming, including half-screen in-app casual games for users toplay while simultaneously watching a live stream, and half-screen interactive in-app games
that users play together with live streamers and V-Livers.
Revenues generated from sale of virtual points used to play in-app games or purchasevirtual in-game equipment and tools when watching a live stream or a V-liver stream arerecognised when the virtual points are used.
Other Business Revenues
The Target Group’s other business revenues primarily derive from its live commercebusiness and Wave.
The Target Group’s live commerce revenues primarily derive from SaaS subscription feesand revenue sharing arrangements for the live commerce services provided by the Target
Group through HandsUp in Japan and OrderPally in Taiwan, and revenues are recognised
when the services are provided. The Target Group offers merchants a three-month trial

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LETTER TO SHAREHOLDERS
account, or three trial live streams. The subscription period is generally six or twelve
months. The Target Group’s live commerce revenues are also derived from commission
arrangements through 17Shop.
The Target Group’s revenues derived from Wave are primarily sales of virtual points to its
users to exchange for virtual gifts presented to live streamers. For further details, pleaserefer to Section 14.3 titled “Information on the Target Company – Business Overview – The
Target Group’s Business Lines – Live Commerce and Wave” of this Circular.
Cost of Revenue
The following table sets forth a breakdown of the Target Group’s cost of revenue by types
in amount and as a percentage of its total cost of revenue for the periods indicated.
FY2020

FY2021

FY2022

1H FY2022

1H FY2023

US$’000%

US$’000%

US$’000%

US$’000%

US$’000%

Revenue
Sharing Fees
and Live
Streaming
Costs

175,878

74.5

236,935

76.4

172,687

72.7

101,29675.1

64,804

73.7

ChannelCosts

47,30220.0

51,05916.5

39,793

16.7

22,77816.9

13,49015.3

Server and
Bandwidth
Costs

8,881

3.8

19,7906.4

20,459

8.6

10,585

7.8

8,932

10.2

Other Costs

3,941

1.7

2,252

0.7

4,630

1.9

281

0.2

700

0.8

236,001

100.0

310,035

100.0

237,569

100.0

134,939

100.0

87,926

100.0

Cost ofrevenue:

Total

Revenue Sharing Fees and Live Streaming Costs
Revenue sharing fees represent the Target Group’s payment to its live streamers andV-Livers based on a percentage of revenue from sales of virtual gifts and other subscriptionbased privileges attributable to such live streamers and V-Livers. When a user sends a
virtual gift to a live streamer or V-Liver, the Target Group shares a pre-agreed portion of theresulting revenue with the live streamer, the V-Liver or their affiliated talent agency, whichis generally in line with that offered by the Target Group’s competitors. When users sendvirtual gifts to live streamers and V-Livers, virtual points representing the value of such
virtual gifts are tagged to the live streamers and V-Livers. In addition, the Target Group has
the discretion to grant bonuses to a live streamer and V-Liver if he/she reaches a
pre-determined target of streaming hours or receives a certain amount of virtual gifts.
The Target Group also shares a pre-agreed portion of revenue with live streamers andV-Livers generated from subscription fees paid by users for enrolling in a subscription planof a live streamer or V-Liver. Each subscription plan is assigned with predetermined numberof virtual points in the Target Group’s system and when subscription fees are paid by users,
the predetermined number of virtual points in the system will be tagged to such live

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streamers and V-Livers, and the live streamers and V-Livers will accrue the virtual points ona daily basis during the subscription period.
The cumulative virtual points which are tagged to each live streamer or V-Liver are thenquantified and accounted for as revenue sharing costs (included in cost of revenue) at theend of each month and settled in cash, and extinguished from the Target Group’s system.
Live streaming costs represent the Target Group’s payment to talent agencies, which are
independent third parties, and are contractually agreed fixed sums under the respective
agreements. These payments cover the recruitment, acquisition, and compensation of newlive streamers and V-Livers. The costs also account for efforts to increase revenue fromexisting live streamers and V-Livers, such as launching special campaigns on the Target
Group’s platforms. Please refer to Section 14.3 titled “Information on the Target Company– Business Overview – Live Streaming – Features of the Target Group’s Platforms” of thisCircular for further details.
Channel Costs
Channel costs consist primarily of fees the Target Group pays to third party payment
channels and distribution channels which include (i) in-app channels such as iOS App Storeand Google Play and (ii) the Target Group’s official web-based store where users canpurchase virtual points. The Target Group’s third party payment and distribution channels
typically charge processing and commission fees, respectively, calculated as a percentageof payments and sales arising from the transactions conducted through the respective
platforms.
Server and Bandwidth Costs
Server and bandwidth costs consist primarily of fees and charges that the Target Grouppays to telecommunication service providers for bandwidth and content delivery-related
service.
Other Costs
Other costs of revenue mainly consist of the Target Group’s content production cost. These
costs are predominantly costs incurred in developing and producing professional generated
content.
Gross Profit and Gross Profit Margin
The following table sets forth a breakdown of gross profit and gross profit margin of theTarget Group.
FY2020

FY2021

FY2022(Audited)

1H FY2022

1H FY2023(Unaudited)

Gross Profit (US$’000)

175,359

187,747

126,149

65,482

63,059Gross Profit Margin (%)

42.6

37.7

34.7

32.7

41.8

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The following table sets forth a breakdown of gross profit and gross profit margin of theTarget Group in local currencies.
FY2020Gross
ProfitGross
ProfitMarginFY2021

Gross
ProfitGross
ProfitMarginFY2022Gross
ProfitGross
ProfitMargin1H FY2022

Gross
Profit(Audited)

Gross
ProfitMargin1H FY2023

Gross
ProfitGross
ProfitMargin(Unaudited)Japan(JPY in billion)

14.7

48.1

16.8

41.9

13.7

41.6

6.7

38.7

7.0

50.2

Taiwan(TW$ in million)

517.3

24.7

593.4

24.4

513.5

19.9

226.4

17.6

259.0

22.2

Operating Expenses
Selling Expenses
Selling expenses primarily comprise (i) marketing expenses, (ii) employee benefits
expense, (iii) depreciation and amortisation, (iv) professional fees, including consulting
fees, and (v) others. The Target Group’s selling expenses are US$97.1 million, US$129.2
million, US$64.3 million, US$37.1 million, and US$24.3 million for FY2020, FY2021,
FY2022, 1H FY2022 and 1H FY2023, respectively. The selling expenses of the Target
Group as a percentage of its total operating expenses are 64.3%, 72.8%, 55.4%, 57.7% and48.6% for FY2020, FY2021, FY2022, 1H FY2022 and 1H FY2023, respectively.
General and Administrative Expenses
General and administrative expenses primarily comprise (i) employee benefits expense,(ii) depreciation and amortisation, (iii) professional fees, including audit fees, consulting
fees and legal fees, (iv) provision for expected credit losses for trade receivables,(v) provision for expected credit losses for other receivables and (vi) others. The Target
Group’s general and administrative expenses are US$49.8 million, US$31.6 million,
US$24.4 million, US$14.1 million, and US$12.2 million for FY2020, FY2021, FY2022, 1H
FY2022 and 1H FY2023, respectively. The general and administrative expenses of theTarget Group as a percentage of its total operating expenses are 33.0%, 17.8%, 21.0%,
21.9% and 24.4% for FY2020, FY2021, FY2022, 1H FY2022 and 1H FY2023, respectively.
Research and Development Expenses
Research and development expenses primarily comprise (i) employee benefits expense,
including wages and salaries, welfare and share-based compensation for research anddevelopment personnel, (ii) depreciation and amortisation, (iii) professional fees, including
consulting fees, and (iv) others. The Target Group’s research and development expenses
are US$4.1 million, US$16.6 million, US$27.3 million, US$13.1 million, and US$13.5 million
for FY2020, FY2021, FY2022, 1H FY2022 and 1H FY2023, respectively. The research anddevelopment expenses as a percentage of its total operating expenses are 2.7%, 9.4%,
23.5%, 20.4% and 27.0% for FY2020, FY2021, FY2022, 1H FY2022 and 1H FY2023
respectively. During the Period under Review, we expensed majority of research anddevelopment expenses as incurred. The percentage of operating revenue of the Target
Group spent on R&D activities is 1.0%, 3.3%, 7.5%, 6.6% and 9.0% for FY2020, FY2021,
FY2022, 1H FY2022 and 1H FY2023, respectively.

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Non-Operating Income and Expenses
The Target Group’s non-operating income and expenses comprise (i) other gains andlosses, which include revaluation losses on financial liabilities and impairment of goodwill,
primarily attributable to the changes in valuation of preference shares and warrants which
are classified as financial liabilities and not conditional on or relevant to the Target Group’s
operations, and (ii) finance costs, which include interest expenses in connection with loans
and borrowings and lease liabilities.
The following table sets forth a breakdown of the Target Group’s non-operating income andexpenses by types in amount and as a percentage of its total non-operating income andexpenses for the periods indicated.
FY2020

FY2021

FY2022

1H FY2022

1H FY2023

US$’000%

US$’000%

US$’000%

US$’000%

US$’000%

Revaluation(loss)/gain on
financialliabilities(59,106)

81.4

112,407103.2(55,860)

105.4(38,014)108.7(127,649)

99.5

Others(12,554)

17.3(2,791)

(2.6)

3,045

(5.7)

3,157

(9.0)

(638)

0.5

Other Gainsand Losses(71,660)

98.7

109,616100.7(52,815)

99.7(34,857)

99.7(128,288)

100.0

(974)

1.3

(743)

(0.7)

(172)

0.3

(110)

0.3

(54)

0.0

(72,634)

100.0

108,873

100.0(52,987)

100.0(34,967)

100.0(128,341)

100.0

NonOperating
Income andExpenses:Finance Costs
Total

18.4 Results of Operations
1H FY2023 Compared to 1H FY2022
Operating Revenue
The Target Group’s operating revenue decreased by 24.7% from US$200.4 million in
1H FY2022 to US$151.0 million in 1H FY2023, which was mainly attributable to thedecrease in Liver live streaming revenues.
This is primarily due to the decrease in the number of users on 17LIVE resulting mainly fromthe normalisation and resumption of economic activities after the ease of the COVID-19
pandemic restrictions. Additionally, the Target Group made a deliberate shift in its strategy
to focus on profitability by targeting quality users over scale. The introduction of new
business initiatives such as V-Liver live streaming offerings, in-app games and livecommerce also began to gain traction. As a result, while the average monthly MAU
decreased from approximately 1,149,000 in 1H FY2022 to approximately 550,000 in
1H FY2023, the Target Group observed an increase in the Spend Rate from 10.7% to 16.1%
whilst maintaining the ARPPU at US$302 over the same period.
Operating revenue derived from other businesses increased by 15.0% from US$3.0 million
in 1H FY2022, compared to US$3.4 million in 1H FY2023.

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Cost of Revenue
The Target Group’s cost of revenue decreased by 34.8% from US$134.9 million in
1H FY2022 to US$87.9 million in 1H FY2023, which was primarily attributable to a decrease
in revenue sharing fees and live streaming costs by 36.0% from US$101.3 million in
1H FY2022 to US$64.8 million in 1H FY2023, mainly due to a decrease in the number ofContracted MAS as a result of the ease of the COVID-19 pandemic restrictions.
The channel costs decreased by 40.8% from US$22.8 million in 1H FY2022 to US$13.5
million in 1H FY2023 mainly due to a shift in transactions towards the Target Group’s official
web-based store, resulting from optimised payment methods. In particular, in 1H FY2023,
more users shifted towards third party payment methods/channels available on the Target
Group’s official website as compared to payments made through in-app channels. The
channel costs of the Target Group therefore decreased by 40.8% because of such users’
shift in payment methods, as well as a general decrease in sales volume. The server andbandwidth costs decreased by 15.6% from US$10.6 million in 1H FY2022 to US$8.9 million
in 1H FY2023 mainly due to improved operating efficiency. Other costs increased by
149.3% from US$0.3 million in 1H FY2022 to US$0.7 million in 1H FY2023.
Gross Profit and Gross Profit Margin
As a result of the foregoing, the Target Group’s gross profit remained relatively stable anddecreased by 3.7% from US$65.5 million in 1H FY2022 to US$63.1 million in 1H FY2023,
and its gross profit margin improved by 9.1% from 32.7% in 1H FY2022 to 41.8% in 1H
FY2023.
This is primarily attributable to: (i) an increasing contribution from high-margin in-app gamerevenue, which is not subject to revenue sharing arrangements with live streamers andV-Livers; (ii) a decrease in channel costs resulting from optimised payment methods; and(iii) a decrease in server and bandwidth costs resulting from improvement in operating
efficiency.
Operating Expenses
The Target Group’s operating expenses decreased by 22.2% from US$64.3 million in
1H FY2022 to US$50.1 million in 1H FY2023, which was primarily attributable to a decrease
in selling expenses.
Selling Expenses. The Target Group’s selling expenses decreased by 34.5% from US$37.1
million in 1H FY2022 to US$24.3 million in 1H FY2023, primarily attributable to a decreasein marketing expenses in line with the Target Group’s strategic shift to return-driven
marketing strategy.
General and Administrative Expenses. The Target Group’s general and administrative
expenses decreased by 13.1% from US$14.1 million in 1H FY2022 to US$12.2 million in 1H
FY2023, primarily due to a decrease in employee benefits expense, resulting from astreamlined staffing structure implemented by the Target Group as part of its cost
optimisation initiatives.
Research and Development Expenses. The Target Group’s research and development
expenses remained relatively stable, and increased by 2.9% from US$13.1 million in
1H FY2022 to US$13.5 million in 1H FY2023.
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Operating Income
As a result of the foregoing, the Target Group’s operating income increased from US$1.1
million in 1H FY2022 to US$13.0 million in 1H FY2023.
Non-Operating Income and Expenses
The Target Group’s non-operating income and expenses increased by 267.0%, from a lossof US$35.0 million in 1H FY2022 to a loss of US$128.3 million in 1H FY2023, which was
primarily attributable to revaluation loss on financial liabilities by US$89.6 million from aloss of US$38.0 million in 1H FY2022 to a loss of US$127.6 million in 1H FY2023. Suchfinancial liabilities were in relation to the fair value adjustment for preference shares andwarrants.
Income Tax Expenses
The Target Group’s income tax expenses decreased by 64.3% from US$8.1 million in
1H FY2022 to US$2.9 million in 1H FY2023, primarily attributable to a lower taxable income
and the restructuring of the Target Group, which led to a more tax-efficient structure.
Loss for the Period
As a result of the foregoing, the Target Group’s loss for the period changed from a net lossof US$42.0 million in 1H FY2022 to a net loss of US$118.2 million in 1H FY2023.
FY2022 Compared to FY2021
Operating Revenue
The Target Group’s operating revenue decreased by 26.9% from US$497.8 million in
FY2021 to US$363.7 million in FY2022, which was mainly attributable to the decrease inLiver live streaming revenues.
This is primarily due to the decrease in the number of the Target Group’s spenders
attributable to a lower user base resulting mainly from the Target Group’s deliberate shift inits strategy to focus on profitability by targeting quality users rather than pure scale. The
outcome of this shift was an increase in Quality MAU and Spend Rate. MAU dropped fromapproximately 1,159,000 in FY2021 to approximately 886,000 in FY2022, however the
Spend Rate increased from 12.8% to 14.0% over the same period.
However, despite the effective monetisation strategy implemented by the Target Group, the
ARPPU dropped from an average of US$358 in FY2021 to US$294 in FY2022, as users
reduced entertainment budgets post-COVID-19 pandemic and with the ease of COVID-19
pandemic restrictions, and users gradually returned to more offline activities, resulting inlower demand for online entertainment, including interactive live streaming.
Operating revenue derived from other businesses increased to US$6.0 million in FY2022,
compared to US$4.7 million in FY2021.

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LETTER TO SHAREHOLDERS
Cost of Revenue
The Target Group’s cost of revenue decreased by 23.4% from US$310.0 million for FY2021
to US$237.6 million for FY2022, which was primarily attributable to (i) a decrease inrevenue sharing fees and live streaming costs by 27.1% from US$236.9 million for FY2021
to US$172.7 million for FY2022 and (ii) a decrease in channel costs by 22.1% from US$51.1
million for FY2021 to US$39.8 million for FY2022, both due to a decrease in the number ofContracted MAS as a result of the ease of the COVID-19 pandemic restrictions. The serverand bandwidth costs increased by 3.4% from US$19.8 million for FY2021 to US$20.5
million for FY2022. Other costs increased by 105.6% from US$2.3 million for FY2021 to
US$4.6 million for FY2022.
Gross Profit and Gross Profit Margin
As a result of the foregoing, the Target Group’s gross profit decreased by 32.8% from
US$187.7 million for FY2021 to US$126.1 million for FY2022, and its gross profit margin
remained relatively stable for FY2021 and FY2022.
This is primarily due to the Target Group’s continued enhancement in revenue sharing
percentage with live streamers in Taiwan to maintain a competitive rate and attract top-tiertalents. Such decrease was partially offset by the Target Group’s shift from an hourly wage
scheme to a pure revenue sharing model in Japan. Additionally, there was a shift in payment
channels from “in-app” purchase to the official web-based store, which offers a lower
transaction fee.
Operating Expenses
The Target Group’s operating expenses decreased by 34.6% from US$177.4 million for
FY2021 to US$116.0 million for FY2022, which was primarily attributable to the decrease in
selling expenses.
Selling Expenses. The Target Group’s selling expenses decreased by 50.2% from
US$129.2 million for FY2021 to US$64.3 million for FY2022, primarily attributable tostrategic focus on selecting marketing channels and shifted focus to higher marketing
return. As a result, the Target Group’s selling expenses as a percentage of total operating
expenses for FY2022.
General and Administrative Expenses. The Target Group’s general and administrative
expenses decreased by 22.8% from US$31.6 million for FY2021 to US$24.4 million for
FY2022, primarily due to a decrease in staffing costs arising from a generally streamlined
staffing structure and a decrease in professional fees.
Research and Development Expenses. The Target Group’s research and development
expenses increased by 64.4% from US$16.6 million for FY2021 to US$27.3 million for
FY2022, due to (i) an expansion of its research and development team for its in-app game
offerings in relation to Liver and V-Liver live streaming services, and (ii) an increase ofrental fees of cloud services, software and servers utilised by its research and development
personnel to accommodate the newly introduced interactive in-app games on 17LIVE.

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LETTER TO SHAREHOLDERS
Operating Income
As a result of the foregoing, the Target Group’s operating income remained relatively stable,
and decreased by 2.3% from US$10.4 million for FY2021 to US$10.1 million for FY2022.
Non-Operating Income and Expenses
The Target Group’s non-operating income and expenses changed from an income of
US$108.9 million for FY2021 to a loss of US$53.0 million for FY2022, which was primarily
attributable to revaluation losses on financial liabilities, loss on disposal of property, plantand equipment, and foreign exchange gains. In particular, the Target Group’s revaluation
losses on financial liabilities changed from a gain of US$112.4 million for FY2021 to a lossof US$55.9 million for FY2022. Such financial liabilities were in relation to the fair value
adjustment for preference shares and warrants.
Income Tax Expenses
The Target Group’s income tax expenses decreased by 16.2% from US$9.7 million for
FY2021 to US$8.2 million for FY2022 which was primarily attributable to decrease inassessable profit.
Loss for the YearAs a result of the foregoing, the Target Group’s income for the year changed from a net
profit of US$109.5 million for FY2021 to a net loss of US$51.0 million for FY2022.
FY2021 Compared to FY2020
Operating revenue
The Target Group’s operating revenue increased by 21.0% from US$411.4 million for
FY2020 to US$497.8 million for FY2021, which was mainly attributable to the increase in its
Liver live streaming revenues.
This is primarily due to the increase in the number of its spenders attributable to the growthin the Target Group’s user base and an improvement in its monetisation strategy. The
COVID-19 pandemic played a significant role in the growth of user base due to the social
distancing measures and lockdowns, as people increasingly turned to consuming digitalcontent for entertainment. In line with the shift in user behaviour, the Spend Rate increased
from 9.3% for FY2020 to 12.8% in FY2021, and the ARPPU increased from approximately
US$322 for FY2020 to approximately US$358 for FY2021, underscoring the heightened
online spending tendencies of users during lockdowns.
Operating revenue derived from other businesses increased by 206.8% from US$1.5 million
for FY2020 to US$4.7 million for FY2021.
Cost of Revenue
The Target Group’s cost of revenue increased by 31.4% from US$236.0 million for FY2020
to US$310.0 million for FY2021, which was primarily attributable to an increase in revenue
sharing fees and live streaming costs by 34.7%, from US$175.9 million for FY2020 to
US$236.9 million for FY2021. The increase was largely driven by the recruitment of more
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live streamers, many of whom joined for a supplemental income source and due to thesocial distancing measures imposed during the COVID-19 pandemic. Additionally, there
was a change in the revenue sharing model in Japan and Taiwan. The Target Group
introduced the hourly wage scheme in Japan, and enhanced the revenue sharing
percentage with live streamers in Taiwan to maintain a competitive rate and attract top-tiertalent.
The channel cost increased by 7.9% from US$47.3 million for FY2020 to US$51.1 million
for FY2021. The server and bandwidth costs increased by 122.8% from US$8.9 million for
FY2020 to US$19.8 million for FY2021. Other costs decreased by 42.9% from US$3.9
million for FY2020 to US$2.3 million for FY2021.
Gross Profit and Gross Profit Margin
As a result of the foregoing, the Target Group’s gross profit increased by 7.1% from
US$175.4 million for FY2020, to US$187.7 million for FY2021.
The Target Group’s gross profit margin decreased by 4.9% from 42.6% pts for FY2020 to
37.7% pts for FY2021, which was mainly attributable to the increase in the revenue sharing
with live streamers, particularly resulting from the Target Group’s introduction of hourly
wage schemes for live streamers in Japan and the enhanced revenue sharing percentage
with live streamers in Taiwan in FY2021.
Operating Expenses
The Target Group’s operating expenses increased by 17.5% from US$150.9 million for
FY2020 to US$177.4 million for FY2021, which was primarily attributable to the increase in
selling expenses and increase in research and development expenses.
Selling Expenses. The Target Group’s selling expenses increased by 33.1% from US$97.1
million for FY2020 to US$129.2 million for FY2021, which was primarily attributable to its
increased marketing efforts focused on further building its user base and promoting its
brands across various marketing channels to generate new user traffic.
General and Administrative Expenses. The Target Group’s general and administrative
expenses decreased by 36.5% from US$49.8 million for FY2020 to US$31.6 million for
FY2021, primarily due to decrease in staffing costs arising from a generally streamlined
staffing structure and a decrease in amortisation expense.
Research and Development Expenses. The Target Group’s research and development
expenses increased by 307.8% from US$4.1 million for FY2020 to US$16.6 million for
FY2021, which was primarily attributable to the Target Group’s allocation of employee
resources from general and administrative divisions to R&D divisions in FY2021 due totechnological upgrade. The Target Group continued to invest significant resources into its
R&D for new features and products, as well as for improvement of its technology
infrastructure. The Target Group’s research and development expenses as a percentage of
total operating revenue also slightly increased from 1.0% for FY2020 to 3.3% for FY2021.

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Operating Income
As a result of the foregoing, the Target Group’s operating income decreased by 57.6% from
US$24.4 million for FY2020 to US$10.4 million for FY2021.
Non-Operating Income and Expenses
The Target Group’s non-operating income and expenses changed significantly from a lossof US$72.6 million for FY2020 to an income of US$108.9 million for FY2021, which was
primarily attributable to the change in other gains and losses from a loss of US$71.7 million
for FY2020 to a gain of US$109.6 million for FY2021, which was as a result of therevaluation gains on financial liabilities. The Target Group’s revaluation gains on financial
liabilities changed from a loss of US$59.1 million for FY2020 to a gain of US$112.4 million
for FY2021. Such financial liabilities were in relation to the fair value adjustment for
preference shares and warrants.
Income Tax Expenses
The Target Group’s income tax expenses increased by 84.0% from US$5.3 million for
FY2020 to US$9.7 million for FY2021, primarily due to increase in assessable profit
resulting from higher level of revenues in relation to the Target Group’s operations in Japan.
Income for the YearAs a result of the foregoing, the Target Group’s income for the year changed from a net lossof US$51.9 million for FY2020 to a net profit of US$109.5 million for FY2021.
18.5 Non-IFRS Financial Measures: Adjusted Net Income/Loss, EBITDA and Adjusted
EBITDATo supplement the Target Group’s consolidated financial statements, which are preparedand presented in accordance with IFRS, the Target Group also uses adjusted net loss,
EBITDA and adjusted EBITDA as an additional financial measure, which is not required by,or presented in accordance with, IFRS.
These non-IFRS financial measures eliminate the impact of items that are not indicative of
the performance of the Target Group’s business, and the Target Group believes that they
provide useful information to investors and others in understanding and evaluating theTarget Group’s consolidated results of operations in the same manner as they help theTarget Group’s management. However, the Target Group’s presentation of adjusted net
income/loss, EBITDA and adjusted EBITDA may not be comparable to similarly titledmeasures presented by other companies. These non-IFRS financial measures have
limitations as an analytical tool, and should not be considered in isolation from, or as a
substitute for an analysis of, the Target Group’s results of operations or financial condition
as reported under IFRS.
The Target Group defines EBITDA as operating income before depreciation andamortisation. The Target Group defines adjusted EBITDA as EBITDA net of share-based
payment. The Target Group defines adjusted net profit/(loss) as profit/(loss) for the year,
excluding the revaluation (loss)/gain on financial liabilities as they are not expected to recur
after Completion. The changes in the valuation of the Target Group’s financial liabilities for
the Period Under Review were primarily attributable to changes in valuation of its
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preference shares, which was calculated using the market approach, the Backsolve
Method. The Backsolve Method is sensitive to certain key assumptions and inputs,
including the volatility in share price of listed comparable companies and the expected
timing of exit events. The changes in the valuation of the Target Group’s preference sharesfor the Period Under Review were primarily attributable to the volatility in share price ofcomparable listed companies.
The table below presents reconciliations of the Target Group’s adjusted net profit/loss to
profit/(loss) for the period/year, the most directly comparable financial measure calculated
and presented in accordance with IFRS, for the periods indicated:
1H
FY2021
FY2022
FY2022(US$’000 except adjusted profit margin)

FY2020(Loss)/profit for the period/
year
Add/(less): Revaluation(loss)/gain on financial
liabilities
Adjusted profit/(loss) forthe period/year
Adjusted profit margin

1H
FY2023(51,948)

109,511(51,017)(41,974)(118,245)

59,106(112,407)

55,86038,014

127,649

7,158(2,896)

4,843(3,960)

9,404

1.7%

(0.6%)

1.3%(2.0%)

6.2%

The table below presents reconciliations of the Target Group’s EBITDA and adjusted
EBITDA to operating income, the most directly comparable IFRS financial measure, for theperiods indicated:
FY2020

1H
1H
FY2021
FY2022
FY2022
FY2023(US$’000 except adjusted EBITDA margin)

Operating Income for the
Year/Period
Add: Depreciation
Add: Amortisation
EBITDA

24,421
2,710
3,176
30,307

10,3662,868
2,217
15,451

10,1242,591
2,301
15,016

1,135
1,648
1,096
3,879

13,006
1,054
1,334
15,394

Add: Share-based payment

2,989

1,924

840

470

352

Adjusted EBITDA

33,296

17,37515,856

4,350

15,745Adjusted EBITDA margin

8.1%

3.5%

4.4%

2.2%

10.4%

18.6 Consolidated Balance Sheet Position
The Target Group’s total liabilities and equity as of 31 December 2022 were US$103.4
million, comprising of current liabilities of US$284.6 million, non-current liabilities of US$2.0
million and equity-deficit of US$183.2 million. The Target Group’s current liabilities wereprimarily attributable to its financial liabilities at fair value through profit or loss of US$211.1
million in relation to its preference shares and the change in its valuation, and trade andother payables of US$59.0 million. The Target Group’s equity-deficit was primarily
attributable to its accumulated deficit of US$206.6 million which was partially offset by its
share premium of US$25.4 million.

231

LETTER TO SHAREHOLDERSThe Target Group’s total liabilities and equity as of 30 June 2023 were US$99.3 million,
comprising of current liabilities of US$61.4 million, non-current liabilities of US$340.2
million and equity-deficit of US$302.3 million. The Target Group’s current liabilities wereprimarily attributable to its trade and other payables of US$47.3 million. The Target Group’s
equity-deficit was primarily attributable to its accumulated deficit of US$324.8 million which
was partially offset by its share premium of US$25.4 million.
18.7 Liquidity and Capital Resources
The Target Group’s principal sources of liquidity have been investments from its
shareholders through private placements and cash generated from operating activities.
The Target Group’s principal sources of liquidity have been investments from its
shareholders through private placements and cash generated from operating activities.
As of 30 June 2023, the Target Group had approximately US$39.9 million in cash and cash
equivalents, which consist of cash on hand, checking and demand deposits and cash
equivalents. The Target Group’s cash and cash equivalents are primarily denominated in
JPY as well as in local currencies of the markets in which it operates. The Target Groupintends to finance its future working capital requirements and capital expenditures, and fundits operations and expansion plans post-Completion of the Proposed Business
Combination, through cash and cash equivalents on hand as well as the proceeds raised
from the Escrow Account and the PIPE Financing. The Target Group’s operations are notfunded by shareholders’ loans or bank borrowings. As of 30 June 2023, the Target Group
did not take out any credit arrangement or bank loan. Please refer to Section 22 titled “Useof Proceeds” of this Circular for further details.
The Proposed Directors are of the reasonable opinion that, after taking into consideration
the above and notwithstanding that the Target Group had a net current liabilities position
and recorded negative cash flow used in operating activities for both FY2021 and FY2022,
having made due and careful enquiry and after taking into account the expected cash flows
generated from the Target Group’s operations and the Target Group’s currently available
cash and cash equivalents as well as the net proceeds from the Proposed Transactions, theworking capital available to the Target Group as at the date of this Circular is sufficient for
the Target Group to meet the present working capital requirements and for at least the next
12 months after Completion.

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LETTER TO SHAREHOLDERS
The following table sets forth a summary of the Target Group’s net cash flows fromoperating activities, investing activities and financing activities for the periods indicated.

Summary Consolidated Cash
Flow Data:
Net cash flows from/(usedin) operating activities
Net cash flows from/(usedin) investing activities
Net cash flows from/(usedin) financing activities
Net increase/(decrease) incash and cash equivalents
Net foreign exchange
differences
Cash and cash equivalents
at beginning of financial year
Cash and cash equivalents
at end of financial year

FY2020

FY2021

FY2022

1H
FY2022

1H
FY2023

US$’000

US$’000

US$’000

US$’000

US$’000

66,719(2,912)(10,464)(16,051)

3,988

3,444

(1,376)

(848)

(560)

(759)

(122)

(26,620)(4,185)(2,606)(791)

70,042(30,907)(15,497)(19,218)

2,438

685

(2,493)(4,334)(3,700)(1,832)

21,76592,49159,09159,091

39,25992,49159,091

39,25936,17339,866

Operating Activities
Net cash generated from operating activities was US$4.0 million in 1H FY2023. This
amount represents the Target Group’s loss before tax of US$115.3 million, as well as certain
adjustments including revaluation losses on financial liabilities of US$127.6 million, tradeand other payables of US$13.3 million which was primarily attributable to revenue sharing
fees and one-off retrospective tax paid in Japan which amounted to US$4.3 million7, andpartially offset by trade and other receivables of US$3.5 million.
Net cash used in operating activities was US$16.1 million in 1H FY2022. This amountrepresents the Target Group’s loss before tax of US$33.8 million, as well as certain
adjustments including revaluation losses on financial liabilities of US$38.0 million, tradeand other payables of US$20.0 million which was primarily attributable to revenue sharing
fees and selling expenses, and partially offset by trade and other receivables of US$7.5
million.
Net cash used in operating activities was US$10.5 million for FY2022, the difference
between the net cash used in operating activities and the Target Group’s loss before tax of
US$42.9 million was due to certain adjustments including revaluation losses on financial
liabilities of US$55.9 million, trade and other receivables of US$10.2 million, which was
primarily attributable to the sales of virtual points conducted through third party payment
channels, and partially offset by trade and other payables of US$23.7 million, which was
primarily attributable to revenue sharing fees and selling expenses, and income tax paid of
US$14.0 million.

7

17LIVE Japan was subject to a tax audit by the National Tax Agency of Japan (“NTAJ”) with respect to the Japanese
consumption tax (“JCT”) for the financial years ended 31 December 2018 to 2021. 17LIVE Japan filed its amended
JCT returns with the NTAJ for the financial years ended 31 December 2018 to 2021 in June 2023, resulting in paymentof such one-off retrospective tax.

233

LETTER TO SHAREHOLDERS
Net cash used in operating activities was US$2.9 million for FY2021. This amountrepresents the Target Group’s income before tax of US$119.2 million, as well as certain
adjustments including revaluation gains on financial liabilities of US$112.4 million, andpartially offset by trade and other payables of US$6.9 million, which was primarily
attributable to selling expenses relating to certain one-off promotion events, and income tax
paid of US$10.4 million.
Net cash generated from operating activities was US$66.7 million in FY2020. This amountrepresents the Target Group’s loss before tax of US$48.2 million, as well as certain
adjustments including revaluation losses on financial liabilities of US$59.1 million, tradeand other receivable of US$19.8 million, and partially offset by impairment for goodwill of
US$10.6 million, trade and other payables of US$50.6 million. The trade and other payables
and cash flows was mainly due to increased sales of virtual points.
Investing Activities
Net cash used in investing activities was US$0.8 million in 1H FY2023, which was primarily
attributable to acquisition of property, plant and equipment of US$1.0 million, which mainly
consisted of purchase of office furniture and other office set-up related costs, and partially
offset by decrease in guarantee deposit of US$0.2 million.
Net cash used in investing activities was US$0.6 million in 1H FY2022, which was primarily
attributable to acquisition of property, plant and equipment of US$0.3 million, which mainly
consisted of purchase of office equipment, and purchase of intangible assets of US$0.2
million.
Net cash used in investing activities was US$0.8 million for FY2022, which was primarily
attributable to acquisition of property, plant and equipment of US$0.4 million, which mainly
consisted of the purchase of office furniture and other office set-up related costs andacquisition of intangible assets of US$0.5 million, and partially offset by acquisition offinancial assets at fair value through profit or loss of US$0.1 million.
Net cash used in investing activities was US$1.4 million for FY2021, which was primarily
attributable to acquisition of property, plant and equipment of US$1.1 million, which mainly
consisted of the purchase of office furniture and other office set-up related costs, andincrease in guarantee deposit of US$0.2 million.
Net cash generated from investing activities was US$3.4 million in FY2020, which was
primarily attributable to the acquisition of a subsidiary resulting in cash inflow of US$3.9
million, decrease in guarantee deposit of US$0.7 million and disposal of subsidiaries of
US$0.7 million, and partially offset by purchase of property, plant and equipment of US$1.5
million, which mainly consisted of the purchase of office furniture and other office set-up
related costs and acquisition, and purchase of intangible assets of US$0.2 million, whichprimarily represented the purchase of domain names in preparation for the continued
expansion of the Target Group’s platforms.

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LETTER TO SHAREHOLDERS
Financing Activities
Net cash used in financing activities was US$0.8 million in 1H FY2023, which was primarily
attributable to the repayments of principal portion of lease liabilities of US$0.7 million.
Net cash used in financing activities was US$2.6 million in 1H FY2022, which was primarily
attributable to the repayments of principal portion of lease liabilities of US$1.3 million andrepayment of loans and borrowings of US$1.2 million.
Net cash used in financing activities was US$4.2 million for FY2022, which was primarily
attributable to repayments of principal portion of lease liabilities of US$2.9 million andrepayment of loans and borrowings of US$1.2 million.
Net cash used in financing activities was US$26.6 million for FY2021, which was primarily
attributable to repurchase of preference shares of US$14.6 million, repayment of loans andborrowings of US$5.8 million, repayments of principal portion of lease liabilities of US$2.3
million, repurchase of restricted share units of US$1.8 million and repurchase andretirement of ordinary shares of US$1.8 million.
Net cash used in financing activities was US$0.1 million for FY2020, which was primarily
attributable to repurchase and retirement of ordinary shares of US$32.7 million andrepayments of principal portion of lease liabilities of US$1.1 million, partially offset byproceeds from issuance of preference shares of US$28.1 million and proceeds from loans
and borrowings of US$6.7 million.
Capital Expenditures and Divestments
Material Capital Expenditures
The details of material capital expenditures made by the Target Group during the Period
Under Review and the Latest Practicable Date are set forth in the table below.

FY2020

FY2021

FY2022

1H FY2023

From 1 July
2023 to theLatestPracticable
Date

US$
Expenditures
Leasehold improvement for
the Target Group’s head
office in Taiwan
Leasehold improvement for
the Target Group’s office in
TaiwanLeasehold improvement for
the Target Group’s photostudio in Taiwan
Leasehold improvement for
the Target Group’s office in
Taiwan
Domain name acquisition
Total

838,339

–

–

–

–

–

121,143

–

–

–

–

–

129,681–––
142,830––––

570,542–561,305–

981,169

121,143

129,681570,542561,305

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LETTER TO SHAREHOLDERS
The above capital expenditures were incurred in Taiwan and primarily financed by internallygenerated resources. In these periods, the Target Group’s capital expenditures were mainly
used for purchases of, intangible assets such as computer software, and plant andequipment such as servers and computers. As at the Latest Practicable Date, save as
disclosed above, the Target Group does not have any material expenditure on capital
investment in progress.
Material Divestments
The details of material divestments made by the Target Group during the Period Under
Review and the Latest Practicable Date are set forth in the table below.

FY2020

FY2021

FY2022

1H FY2023

From 1 July
2023 to theLatestPracticable
Date

US$
Divestments
Disposal of leasehold
improvement due to theTarget Group’s officerelocation in Taiwan––

843,987

–

–

Total

–

–

843,987––

The above divestment was made in Taiwan. As at the Latest Practicable Date, saved as
disclosed above, the Target Group did not have any material divestment of capital
investment in progress.
Employee Share-based Payment
All of the Target Group’s share-based payments are equity settled. Employee services
received are measured at the fair value of the equity instruments awarded at the granting
date, and are recognised as compensation cost over the vesting period, with acorresponding adjustment to equity. The fair value of the equity instruments granted shallreflect the impact of market vesting conditions and exclude the impact of any service andnon-market performance vesting conditions.
Compensation cost is subject to adjustment based on the service conditions that are
expected to be satisfied and the estimates of the number of equity instruments that are
expected to vest under the non-market vesting conditions at each balance sheet date.
Ultimately, the amount of compensation cost recognised is based on the number of equity
instruments that eventually vest.
In connection with the Proposed Business Combination, the Company shall allot and issue
up to 2,114,891 ESOP Shares in accordance with the Company ESOP. Please refer to
Section 12 titled “Proposed Adoption of the Company Employee Share Option Plan” of thisCircular for further details.

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LETTER TO SHAREHOLDERS
The following table summarises activities under the Target Group’ employee share incentive
plans as of the dates indicated:
As of
30 JuneAs of 31 December

Number of restricted share units
outstanding

2020

2021

2022

2023

55,769,761

40,901,923

28,291,482

27,235,961

Impairment Assessment of Tangible and Intangible Assets (Excluding Goodwill)
The Target Group assesses impairment based on its subjective judgement and determines
the separate cash flows of a specific group of assets, useful lives of assets and the future
possible income and expenses arising from the assets depending on how assets are
utilised and their industrial characteristics. Any changes of economic circumstances or
estimates due to the change of the Target Group’s strategy might cause material
impairment on assets in the future.
Impairment Assessment of Goodwill
The impairment assessment of goodwill relies on the Target Group’s subjective judgement,
including identifying cash-generating units, allocating assets and liabilities as well as
goodwill to related cash-generating units, and determining the recoverable amounts ofrelated cash-generating units.
18.8 Capital Commitments
The following table sets forth the Target Group’s capital commitments as at the Latest
Practicable Date:
Payment Due by PeriodLess Than
1 YearOver 1 Year Over 3 Years
but Less
but Less
Than 3 Years Than 5 Years

Over 5 Years

Total

(US$)
Trade and otherliabilities (1)Lease liabilities(2)

43,499,606

–

–

–

43,499,606

1,570,265

1,251,506––

2,821,771

Notes:(1) Represents revenue sharing fees and content cost, as well as other payables including marketing expenses,
accrued salaries and sales tax payable.
(2) Represents future minimum lease payments under non-cancellable operating leases in connection with theleases of offices.

237

LETTER TO SHAREHOLDERSThe Target Group intends to finance the above capital commitments with funds fromcontinuing operations. Other than those shown above, the Target Group did not have any
significant capital and other commitments, long-term obligations, or guarantees as at theLatest Practicable Date.
18.9 Critical Accounting Policies
An accounting policy is considered critical if it requires an accounting estimate to be madebased on assumptions about matters that are highly uncertain at the time such estimate is
made, and if different accounting estimates that reasonably could have been used, orchanges in the accounting estimates that are reasonably likely to occur periodically, could
materially impact the consolidated financial statements.
The Target Group prepares its consolidated financial statements in accordance with
International Financial Reporting Standards (“IFRS”), which collective term includes all
applicable individual IFRS, International Accounting Standards (“IAS”) as issued by theInternational Accounting Standards Board (the “IASB”) and Interpretations issued by theInternational Financial Reporting Interpretations Committee (the “IFRIC Interpretations”)
of the IASB.
The preparation of financial statements in conformity with IFRS, IAS, IFRIC Interpretations,and Interpretations issued by the Standard Interpretations Committee, which were
subsequently endorsed by the IASB, require the use of certain critical accounting
estimates. It also requires the Target Group’s management to exercise its judgement in theprocess of applying its accounting policies. The areas involving a higher degree ofjudgement or complexity, or areas where assumptions and estimates are significant to theconsolidated financial statements are disclosed in Note 3 to the Target Group’s
consolidated financial statements included in this Circular. Since the use of estimates is an
integral component of the financial reporting process, actual results could differ from theTarget Group’s expectations as a result of changes in its estimates. Some of the Target
Group’s accounting policies require a higher degree of judgement than others in theirapplication and require the Target Group to make significant accounting estimates.
The following descriptions of critical accounting policies, judgements and estimates should
be read in conjunction with the Target Group’s consolidated financial statements andaccompanying notes and other disclosures included in this Circular. When reviewing theTarget Group’s financial statements, you should consider (i) the Target Group’s selection ofcritical accounting policies, (ii) the judgements and other uncertainties affecting theapplication of such policies and (iii) the sensitivity of reported results to changes in
conditions and assumptions.

238

LETTER TO SHAREHOLDERS
18.10 Changes in Accounting Policies
The audited consolidated financial statements of the Target Group and the unauditedcondensed interim consolidated financial statements set out in Appendix A titled“Independent Auditor’s Report and Audited Consolidated Financial Statements of the Target
Group for the Financial Years Ended 31 December 2020, 2021 and 2022” and Appendix B
titled “Interim Consolidated Financial Statements of the Target Group for the Six-Month
Period Ended 30 June 2023” to this Circular have each been prepared in accordance withIFRS.
The same accounting policies are applied throughout all periods presented in the audited
consolidated financial statements and the unaudited condensed interim consolidated
financial statements set out in Appendix A titled “Independent Auditor’s Report and Audited
Consolidated Financial Statements of the Target Group for the Financial Years Ended
31 December 2020, 2021 and 2022” and Appendix B titled “Interim Consolidated Financial
Statements of the Target Group for the Six-Month Period Ended 30 June 2023” to thisCircular, respectively, subject to the new standards, interpretations and amendments
adopted by the Group as disclosed in Note 2 to the Target Group’s consolidated financial
statements included in this Circular.
The Target Group currently has no intention to make any changes to its accounting policyin the next 12 months that may result in material adjustments to the disclosed financials for
the Period Under Review.
18.11 Off-balance Sheet Commitments and Arrangements
The Target Group has not entered into any off-balance sheet financial guarantees or otheroff-balance sheet commitments to guarantee the payment obligations of any third parties.
The Target Group has not entered into any derivative contracts that are indexed to its
shares and classified as shareholder’s equity or that are not reflected in its consolidated
financial statements. Furthermore, the Target Group does not have any retained orcontingent interest in assets transferred to an unconsolidated entity that serves as credit,
liquidity or market risk support to such entity. The Target Group does not have any variableinterest in any unconsolidated entity that provides it with financing, liquidity, market risk or
credit support or engages in leasing, hedging or product development services.
18.12 Financial Risk Management
The Target Group is exposed to certain financial risks that arise in its normal course ofbusiness, such as market risk (including foreign exchange risk and interest rate risk) andcredit risk. The Target Group has implemented risk management policies and guidelinesthat seek to minimise potential adverse effects on its financial performance. The Target
Group does not hold or issue derivative financial instruments for speculative purposes.

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LETTER TO SHAREHOLDERS
Foreign Exchange Risk
The Target Group uses US$ as the presentation currency and one of the functional
currencies. During the Period Under Review, the Target Company’s subsidiaries had
different functional currencies in JPY, TW$, HK$ and S$, among other currencies. For
FY2022, the percentage contribution of JPY and NT$ to the Target Group’s revenue was
69.3% and 23.9%, respectively.
As a result, the fluctuations as of US$ against JPY, TW$, HK$ and/or S$ have had, and may
continue to have, a significant impact on the consolidated financial statements of the Target
Group and affect its revenue, expenses, profits, assets and liabilities reflected therein.
Please refer to Note 32(c) of Appendix A titled “Independent Auditor’s Report and Audited
Consolidated Financial Statements of the Target Group for the Financial Years Ended
31 December 2020, 2021 and 2022” to this Circular for further details. The highest andlowest exchange rates between US$ and S$ for each month during the six months
immediately prior to the Latest Practicable Date are set forth below8:
Highest exchange rate
between US$ and S$

Lowest exchange rate
between US$ and S$

1.3562
1.35731.35591.36251.37261.37341.32271.3352
1.3172
1.32891.35271.3631

May 2023
June 2023
July 2023
August 2023
September 2023
October 2023

The average exchange rates between US$ and S$ for FY2020, FY2021 and FY2022, 1H
FY2022 and 1H FY2023 are set forth below9:

Average exchange rate
between US$ and S$

FY2020

FY2021

FY2022

1H
FY2022

1.3221

1.34901.33951.39051H
FY20231.3524The Target Group’s exposure to the risk of changes in foreign exchange rates relates
primarily to its operating activities, when revenues or expenses are denominated in adifferent currency from its functional currency, and its net investments in foreignsubsidiaries. The Target Group applies natural hedges by using accounts receivable andaccounts payable denominated in the same currency. However, this natural hedge does notconcur with the requirement for hedge accounting. Furthermore, as net investments inforeign subsidiaries are for strategic purposes, they are not hedged by the Target Group.

8

Source: Bloomberg L.P.. Bloomberg L.P. has not provided its consent for the inclusion of the exchange rates quoted
under this Section and is therefore not liable for such information. While the Company, the Target Group, the Sole
Issue Manager and Joint Financial Advisers have taken reasonable actions to ensure that the above exchange rates
have been reproduced in their proper form and context, neither the Company, the Target Group, the Sole Issue
Manager and Joint Financial Advisers, nor any other party have conducted an independent review of the informationor verified the accuracy of the contents of the relevant information.

9

Calculated by using the average of the exchange rates between US$ and S$ on the last day of each month during
the period, with exchange rates quote from Bloomberg L.P.

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LETTER TO SHAREHOLDERS
The total exchange gains (losses), including realised and unrealised gains (losses) arisingfrom significant foreign exchange variations on monetary items held by the Target Group for
FY2020, FY2021 and FY2022, and for 1H FY2022 and 1H FY2023 amounted to
US$(1,209,154), US$567,685, US$2,826,708, US$3,015,857 and US$(637,915),
respectively. The analysis of foreign currency market risk arising from significant foreignexchange variations is set forth below:
FY2022
Change in exchange
rate

Effect on profit(loss)%

US$1%(34,653)(1)%

35,354

1%

10,173(1)%(10,379)1%(76,773)(1)%

78,324

JPY:US$

NT$:US$

HK$:US$Interest Rate Risk

The Target Group is not exposed to material risks due to changes in market interest rateand it has not used any derivative financial instrument to manage its interest risk exposure.
After Completion, the Enlarged Group may invest the net proceeds from the Proposed
Transactions in interest-bearing instruments. Investments in both fixed rate and floating
rate interest earning instruments carry a degree of interest rate risk. Fixed rate securities
may have their fair market value adversely impacted due to a rise in interest rates, while
floating rate securities may produce less income than expected if interest rates fall.
Credit Risk
The Target Group is exposed to credit risk from its operating activities, primarily from tradeand other receivables from third party payment channels which collected payments for its
users’ purchase of virtual points on behalf of the Target Group.
The Target Group’s payment terms for each third party payment channel differ. Under theTarget Group’s standard payment terms, it generally grants credit terms ranging from 20 to
60 days, depending on factors including but not limited to their payment history, financial
strength and internal payment schedule, as well as the size of the relevant transaction.
The Target Group will review the trade debts and follow up on the outstanding debts withthe respective third party payment channel. According to the Target Group’s policy, it will
provide an allowance for expected credit losses for trade debts that are over due date andwith recoverability issues. Specific provision or write-off will be made when the Target
Group is of the view that the collectability of an outstanding debt is impaired or the debt isuncollectible.

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LETTER TO SHAREHOLDERS
Except for those trade receivables that have been included in the allowance for expectedcredit losses and based on the third party payment channel’s historical default rates andexperience, the Target Group does not foresee any issue with collection of the outstanding
debts. The Target Group incurred bad debts of US$149,551, US$0, US$16,928 andUS$356,404 which were written off in FY2020, FY2021 and FY2022, and 1H FY2023,
respectively. As of the Latest Practicable Date, approximately 98.7% of the Target Group’s
trade receivables as at 30 June 2023 had been collected.
18.13 Contingent Liabilities
The Target Group does not have any contingent liabilities as at the Latest Practicable Date.
18.14 Off-Balance Sheet Arrangements
The Target Group has no off-balance sheet arrangements that are not reflected in its
financial statements as at the Latest Practicable Date.
Recently Issued Accounting Pronouncements
See Note 2 to the Target Group’s consolidated financial statements included in this Circular
for a detailed discussion.
Significant Developments after 30 June 2023 that May Affect the Target Group’s
Results of Operations
Save as disclosed in Section 14 titled “Information on the Target Company”, Section 15
titled “Prospects, Business Strategies and Future Plans”, Section 16 titled “Risk Factors”
and Section 18 titled “Management’s Discussion and Analysis of Financial Position and
Results of Operations of the Target Group” of this Circular, and the “Independent Auditor’sReport and Audited Consolidated Financial Statements of the Target Group for the Financial
Years ended 31 December 2020, 2021 and 2022”, “Interim Consolidated Financial
Statements of the Target Group for the six-month period ended 30 June 2023” and“Unaudited Pro Forma Consolidated Financial Information of the Enlarged Group for the
Financial Year ended 31 December 2020, 2021 and 2022 and the six-month period ended
30 June 2023” as set out in Appendices A, B and C to this Circular, respectively, and barring
any unforeseen circumstances, the Target Group is not aware of any other known trends,
uncertainties, demands, commitments or events that are reasonably likely to have amaterial effect on net sales or revenues, profitability, liquidity or capital resources for thecurrent financial year, or that may cause the financial information disclosed in this Circular
to be not necessarily indicative of the Target Group’s future operating results or financial
condition. Please refer to the Section titled “Cautionary Note on Forward-Looking
Statements” of this Circular.
19.

CAPITALISATION AND INDEBTEDNESSThe following table, which should be read in conjunction with the full text of this Circular,
including the “Independent Auditors’ Report and Audited Consolidated Financial
Statements of the Target Group for the financial years ended 31 December 2020, 2021 and2022” as set out in Appendix A to this Circular, the “Interim Consolidated Financial
Statements of the Target Group for the Six-Month Period Ended 30 June 2023” as set out
in Appendix B to this Circular and the “Unaudited Pro Forma Consolidated Financial
Information of the Enlarged Group for the Financial Year Ended 31 December 2022 and the242

LETTER TO SHAREHOLDERS
Six-Month Period Ended 30 June 2023” as set out in Appendix C to this Circular, shows theTarget Group’s cash and bank balances, capitalisation and indebtedness, which is preparedbased on:(a)the Target Group’s audited financial statements for the financial year ended
31 December 2022; and(b)

the Target Group’s unaudited management accounts as at 30 September 2023.
As at
31 December
2022

As at
30 September
2023

39,25937,2980
212,023

0
2,297

0
1,012

0
339,326

Total indebtedness

213,035

341,623

Total shareholders’ equity(183,199)(302,221)

69,09576,700(US$’000)
Cash and bank balances indebtedness
Current:– secured and guaranteed– unsecured and non-guaranteed(1)Non-current:– secured and guaranteed– unsecured and non-guaranteed(1)Total capitalisation and indebtedness
Note:(1) Unsecured and non-guaranteed indebtedness pertains to financial liabilities at fair value through profit or loss
and lease liabilities. Financial liabilities at fair value through profit or loss primarily consist of preference
shares and warrants issued by the Target Company. These financial liabilities are expected to be converted
to shareholders’ equity upon Completion.

Save for (a) the changes in working capital; and (b) the changes in shareholders’ equity andreserves arising from the day-to-day operations in the ordinary course of business, there
were no material changes to the Target Group’s capitalisation and indebtedness as
disclosed above as at the Latest Practicable Date.
Credit Facilities
As at 30 June 2023, the Target Group does not have any committed borrowing facilities.

243

LETTER TO SHAREHOLDERS
20.

FINANCIAL EFFECTS OF THE PROPOSED TRANSACTIONS
The pro forma financial effects of the Proposed Business Combination on the share capital,
earnings and the NTA of the Company have been prepared based on the audited
consolidated financial statements of the Company for the financial year ended
31 December 2022 and the six-month period ended 30 June 2023 and the audited
consolidated financial statements of the Target Group for the financial year ended
31 December 2022 and the six-month period ended 30 June 2023.
The pro forma financial effects of the Proposed Business Combination are for illustrative
purposes only. The objective is to illustrate what the historical information might have been
if the Proposed Business Combination had been completed at an earlier date. However,such information is not necessarily indicative of the actual results of the operations or the
related effects in the financial position that would have been attained had the Proposed
Business Combination been completed at such an earlier date. Given that the financial
effects presented below are pro forma in nature and only for illustrative purposes, it does
not necessarily represent the actual financial position and/or results of the Company or the
Enlarged Group immediately after Completion.

20.1 Bases and Assumption
For illustrative purposes only, the financial effects of the Proposed Transactions areprepared based on, inter alia, the following assumptions:(a)the financial effects of the Proposed Transactions on the share capital, NTA andearnings of the Enlarged Group are computed based on the audited financial
statements of the Company and the audited consolidated financial statements of theTarget Group for FY2022 and the condensed interim financial statements of theCompany and the reviewed interim financial statements of the Target Group for
1H FY2023;(b)

the financial effects of the Proposed Transactions on the share capital and NTA of theEnlarged Group are computed assuming that the Proposed Transactions have been
completed on 31 December 2022 and 30 June 2023 (as applicable);(c)the financial effects of the Proposed Transactions on the earnings and EPS of theEnlarged Group are computed assuming that the Proposed Transactions have been
completed on 1 January 2022;(d)

except for the financial effects of the conversion of the warrants and preference sharesof the Target Group, the financial effects do not take into account any transactions
effected or completed by the Enlarged Group subsequent to 31 December 2022 and30 June 2023 (as applicable);(e)directly attributable costs in connection with the Proposed Transactions are assumed
to be approximately S$21.0 million (equivalent to approximately US$15.5 million)
assuming that there is No Redemption and approximately S$19.0 million (equivalent
to approximately US$14.0 million) assuming that there is Maximum Redemption; and(f)the difference between the deemed consideration for the Proposed Business
Combination and the fair value of the net assets of the Enlarged Group, if any, havenot been considered and will be determined on the date of Completion when the
Vendor has effectively obtained control of the Company. The actual difference could
be materially different from the aforementioned assumption.
244

LETTER TO SHAREHOLDERS
For the avoidance of doubt, the financial effects of the Proposed Transactions on NTA andearnings reflect the following:(1)

the 41,606,000 issued Shares held by the Non-Redeeming Shareholders and Vertex
SPV assuming that there is No Redemption and 12,000,000 Shares held by the
Non-Redeeming Shareholders and Vertex SPV assuming that there is Maximum
Redemption;(2)

the allotment and issuance of 160,162,651 Consideration Shares;(3)

the allotment and issuance of 2,000,000 Base PIPE Shares;(4)

the allotment and issuance of 3,760,600 Special Bonus Shares; and(5)

the allotment and issuance of the Promote Shares to the Sponsor,

but do not take into consideration the following:(6)

the allotment and issuance of 2,114,891 ESOP Shares;(7)

the allotment and issuance of 24,408,000 Earnout Shares;(8)

the allotment and issuance of 2,550,000 EIS Shares; and(9)the exercise of the Warrants.

20.2 Financial Effects on Share Capital
As at the Latest Practicable Date, there were 41,606,000 Shares, 12,481,799 Public
Warrants and 16,000,000 Private Placement Warrants outstanding.
Assuming that there is No Redemption and that the total proceeds raised from the PIPE
Financing is S$10.0 million, the Enlarged Share Capital as at Completion is expected to be
207,529,251 Shares.
Assuming that there is Maximum Redemption and that the total proceeds raised from the
PIPE Financing is S$10.0 million, the Enlarged Share Capital as at Completion is expected
to comprise 174,962,651 Shares.
Effects of No
Redemption
Immediately before Completion
Minus: Redemption by Shareholders
Add: Number of Consideration Shares

245

Effects of Maximum
Redemption

41,606,000 Shares

41,606,000 Shares

0 Shares29,606,000 Shares

160,162,651 Shares

160,162,651 Shares

LETTER TO SHAREHOLDERS
Effects of No
Redemption

Effects of Maximum
Redemption

Add: Base PIPE Shares

2,000,000 Shares

2,000,000 Shares

Add: Special Bonus Shares

3,760,600 Shares

800,000 Shares

207,529,251 Shares

174,962,651 Shares

Enlarged Share Capital as at
Completion

20.3 Financial Effects on NTA and NTA per Share
As of 31 December 2022(+) Adjustments

Pro forma

VTAC(+) Target
CompanyNo
Maximum
No
Maximum
Redemption Redemption Redemption Redemption

Shares outstanding(millions)41.6

148.9(1)

N.M.

N.M.

207.5

175.0

NTA (US$ million)

26.4(209.7)

333.8

224.6

150.5

41.3

NTA per share (US$)

0.64(1.41)

N.M.

N.M.

0.73

0.24

Notes: N.M. means not meaningful. The pro forma adjustments relate to:(a) The effects of the reverse takeover accounting for the Proposed Business Combination, including theissuance of the Promote Shares to the Sponsor, with a resultant listing expense of US$22.6 million. The
Proposed Business Combination is classified as a reverse takeover of a SPAC (i.e. the Company), and theCompany does not constitute a business under the definitions in IFRS 3. Accordingly, any excess of the fairvalue of the effective consideration transferred by the Target Company (the accounting acquirer) for theacquisition of the Company (the accounting acquiree), and the fair value of the net identifiable assets andliabilities of the Company acquired, is recorded as a share-based payment in accordance with IFRS 2 (i.e.
listing expense). The fair value of the effective consideration transferred by the Target Company for theacquisition of the Company is determined based on (A) the number of Shares held by (i) the existing
Shareholders (i.e. 41,606,000), (ii) the Special Bonus Shares expected to be issued to the Non-Redeeming
Shareholders (i.e. 3,560,600), and (iii) the Promote Shares expected to be issued within 12 months of theCompletion of the Proposed Business Combination (i.e. 5,096,735), multiplied by (B) the share price of theCompany as of the date of the SPA (S$4.81 per Share), for pro forma illustrative purposes. The fair value ofthe net identifiable assets and liabilities of the Company acquired is determined based on the audited/unaudited balance sheets of the Company as of 31 December 2022 and 30 June 2023 respectively, where thecarrying values of its assets and liabilities approximate their fair values, and as adjusted for (i) the conversionof all redeemable shares into equity, and (ii) the nominal proceeds of S$25,000 expected to be received on
issuance of the Promote Shares.
(b) Conversion of the redeemable shares of the Company of US$130.8 million into equity(c)

Conversion of the warrants and preference shares of the Target Group aggregating to US$211.1 million into
equity(d) Receipt of PIPE proceeds of US$7.4 million(e) Total estimated professional fees in relation to the Proposed Business Combination amounting to US$15.5
million assuming that there is No Redemption and US$14.0 million assuming that there is Maximum
Redemption, which are deemed to have been incurred and settled in cash
(1) Refers to the Basic Sale Shares

246

LETTER TO SHAREHOLDERS
As of 30 June 2023(+) Adjustments

Pro forma

VTAC(+) Target
CompanyNo
Maximum
No
Maximum
Redemption Redemption Redemption Redemption

Shares outstanding(millions)41.6

148.9(1)

N.M.

N.M.

207.5

175.0

NTA (US$ million)

28.9(327.5)

462.6

353.4

164.0

54.8

NTA per share (US$)

0.69(2.20)

N.M.

N.M.

0.79

0.31

Notes: N.M. means not meaningful. The pro forma adjustments relate to:(a) The effects of the reverse takeover accounting for the Proposed Business Combination, including theissuance of the Promote Shares to the Sponsor, with a resultant listing expense of US$19.7 million(b) Conversion of the redeemable shares of the Company of US$129.7 million into equity(c)

Conversion of the warrants and preference shares of the Target Group aggregating to US$338.8 million into
equity(d) Receipt of PIPE proceeds of US$7.4 million(e) Total estimated professional fees in relation to the Proposed Business Combination amounting to US$15.5
million assuming that there is No Redemption and US$14.0 million assuming that there is Maximum
Redemption, which are deemed to have been incurred and settled in cash
(1) Refers to the Basic Sale Shares

20.4 Financial Effects on Earnings and EPS
FY2022(+) Adjustments

Pro forma

VTAC(+) Target
CompanyNo
Maximum
No
Maximum
Redemption Redemption Redemption Redemption

Shares outstanding(millions as of 31 Dec
2022)

41.6

148.9(1)

N.M.

N.M.

207.5

175.0

Net profit after tax(US$ million)

5.3(51.0)

21.2

17.7(24.5)(28.0)Net profit after tax per
share (US$)

0.13(0.34)

N.M.

N.M.

(0.12)(0.16)

Notes: N.M. means not meaningful. The pro forma adjustments relate to:(a) The effects of the reverse takeover accounting for the Proposed Business Combination, including theissuance of the Promote Shares to the Sponsor, with a resultant listing expense of US$22.6 million(b) Reversal of interest expense on redeemable shares of the Company of US$2.6 million(c)

Reversal of the revaluation loss on warrants and preference shares of the Target Group aggregating to
US$55.9 million and changes in credit risk of warrants and preference shares of the Target Group of US$700(d) Total estimated professional fees in relation the Proposed Business Combination amounting to US$15.5
million assuming that there is No Redemption and US$14.0 million assuming that there is Maximum
Redemption, which are deemed to have been incurred and settled in cash
(1) Refers to the Basic Sale Shares.

247

LETTER TO SHAREHOLDERS
1H FY2023(+) Adjustments

Pro forma

VTAC(+) Target
CompanyNo
Maximum
No
Maximum
Redemption Redemption Redemption Redemption

Shares outstanding(millions as of
30 June 2023)

41.6

148.9(1)

N.M.

N.M.

207.5

175.0

Net profit after tax(US$ million)

2.7(118.2)

129.8

126.3

14.3

10.8

Net profit after tax
per share (US$)

0.07(0.79)

N.M.

N.M.

0.07

0.06

Notes: N.M. means not meaningful. The pro forma adjustments relate to:

21.

(a)

Reversal of interest expense on redeemable shares of the Company US$1.5 million(b)

Reversal of the revaluation loss on warrants and preference shares of the Target Group aggregating to
US$127.6 million and changes in credit risk of warrants and preference shares of the Target Group of
US$20,700(c)

Reversal of professional fees accrued and/or paid during the six-month period ended 30 June 2023 inrelation to the Proposed Business Combination, which amounted to US$2.2 million, and which are deemed
to have been incurred on 1 January 2022

(1)

Refers to the Basic Sale Shares

NO MATERIAL EFFECT ON FINANCIAL POSITION
Save as disclosed in this Circular and all public announcements made by the Company, theDirectors are not aware of any event which has occurred since the last audited balance
sheet of 31 December 2022 and up to the Latest Practicable Date, which may have amaterial effect on the financial position and results of the Company.
Save as disclosed in this Circular, the directors of the Target Company are not aware of any
event which has occurred since the last audited balance sheet of 31 December 2022 andup to the Latest Practicable Date, which may have a material effect on the financial position
and results of the Target Company.

22.

USE OF PROCEEDS

22.1 Use of Proceeds Raised from the Company’s Initial Public Offering
According to the Prospectus, 100% of the gross proceeds raised (or S$1.00 for every dollar
raised) by the Company from the Offering, the issuance of the Cornerstone Units, theSponsor IPO Investment Units and the Additional Units will be placed in the Escrow
Account. Such monies in the Escrow Account may be used for the consummation of theinitial business combination, and in the payment of deferred underwriting commissions to
the Joint Global Coordinators, Joint Bookrunners and Joint Underwriters (as defined in the
Prospectus).

248

LETTER TO SHAREHOLDERS
Based on the Prospectus, the Company intends to use the gross proceeds due to it from theOffering, the issuance of the Cornerstone Units, the Sponsor IPO Investment Units and the
Additional Units for the purposes set out below:(a)Consummation of the initial business combination(1): S$202.38 million (based on theOver-allotment Option) or S$0.97 (as a dollar amount for each S$1.00 of the grossproceeds due to the Company from the Offering, the issuance of the Cornerstone
Units, the Sponsor IPO Investment Units and the Additional Units); and(b)

Payment of deferred underwriting commissions to the Joint Global Coordinators, Joint
Bookrunners and Joint Underwriters(1): S$5.65 million (based on the Over-allotment
Option) or S$0.03 (as a dollar amount for each S$1.00 of the gross proceeds due tothe Company from the Offering, the issuance of the Cornerstone Units, the Sponsor
IPO Investment Units and the Additional Units).

Note:(1) Assuming that there is No Redemption at the initial business combination.

For the avoidance of doubt, based on the Prospectus, the gross proceeds to be held in the
Escrow Account does not include the proceeds from the issuance of the Private Placement
Warrants. The gross proceeds raised from the issuance of the 16.0 million Private
Placement Warrants in conjunction with the Offering will be S$8.0 million based on thesubscription price of S$0.50 per Warrant. Such gross proceeds will not be placed in the
Escrow Account and will instead be placed in a separate bank account and be used to pay
for expenses incurred by the Company in connection with the Offering, and any remaining
amounts, together with interest or other income earned on the escrowed funds frompermitted investments, will be applied for general working capital expenses and for the
purpose of identifying and completing an initial business combination.
The Company had raised approximately S$208.03 million from the Offering, the issuance of
the Cornerstone Units, the Sponsor IPO Investment Units and the Additional Units (the “IPO
Proceeds”), which was placed in the Escrow Account. Consistent with its disclosure in the
Prospectus, the Company intends to use the IPO Proceeds for the purposes set out below:(a)Consummation of the initial business combination(1): S$202.38 million or S$0.97 (asa dollar amount for each S$1.00 of the gross proceeds due to the Company from theOffering, the issuance of the Cornerstone Units, the Sponsor IPO Investment Units
and the Additional Units); and(b)

Payment of deferred underwriting commissions to the Joint Global Coordinators, Joint
Bookrunners and Joint Underwriters(1): S$5.65 million or S$0.03 (as a dollar amountfor each S$1.00 of the gross proceeds due to the Company from the Offering, theissuance of the Cornerstone Units, the Sponsor IPO Investment Units and the
Additional Units).

Note:(1) Assumes that there is No Redemption at the initial business combination.

249

LETTER TO SHAREHOLDERS
Pursuant to the terms of the management and underwriting agreement that was entered into
between the Company, the Sponsor, Vertex SPV, CS, DBS and Morgan Stanley Asia
(Singapore) Pte., dated 13 January 2022 (the “MUA”), the Company will, subject to theterms and conditions specified in the MUA, pay the deferred underwriting commissions to
the Joint Global Coordinators, Joint Bookrunners and Joint Underwriters (as defined in the
Prospectus) within ten Market Days following Completion. Accordingly, the Company’s useof the gross proceeds raised from the Offering, the issuance of the Cornerstone Units, theSponsor IPO Investment Units and the Additional Units is consistent with the intended useof proceeds disclosed in the Prospectus.
As at the Latest Practicable Date, the number of Private Placement Warrants purchased is16.0 million and to the best of the knowledge of the Company and subject to Completion,no additional Private Placement Warrants are intended to be purchased by Vertex SPV.
Accordingly, the gross proceeds raised from the issuance of the Private Placement
Warrants is S$8.0 million. Such gross proceeds were not placed in the Escrow Account andwere instead placed in a separate bank account. The Company used such gross proceeds
to pay for expenses incurred by the Company in connection with the Offering, and intends
to use the remaining amounts, together with interest or other income earned on theescrowed funds from permitted investments, for general working capital expenses and forthe purpose of identifying and completing the Proposed Business Combination. This is inline with the disclosure of the intended use of the gross proceeds from the issuance of thePrivate Placement Warrants in the Prospectus.
22.2 Use of Interests and Income Derived from the Amounts in the Escrow Account
As of the Latest Practicable Date, the Company has drawn down S$10.39 million of theinterest earned on the funds placed in the Escrow Account from permitted investments. As
permitted by the Mainboard Rules, all the interest earned will be applied towards thepayment of a substantial portion of the cost incurred by the Company in relation to theadministrative expenses in connection with the IPO, general working capital expenses andrelated expenses and professional fees for the purposes of identifying and completing the
Proposed Business Combination. For the avoidance of doubt, the Company has not drawn
down and will not draw down on any portion of the Company’s IPO proceeds that is placedin the Escrow Account (i.e. S$208,030,000) and such amount will continue to be on depositin the Escrow Account for the purposes of the calculation of the Redemption Price.
22.3 Use of Proceeds Raised from the PIPE Financing and the Completion Remaining
Escrow AmountThe estimated gross proceeds from the issuance of the Base PIPE Shares based on theIssue Price will be approximately S$10.0 million.
For completeness, the Enlarged Group will not receive any proceeds from the issuance of
the Consideration Shares, the Earnout Shares, the EIS Shares, the ESOP Shares and theSpecial Bonus Shares.

250

LETTER TO SHAREHOLDERS
The Enlarged Group intends to use the gross proceeds due to it from the issuance of theBase PIPE Shares as well as the Completion Remaining Escrow Amount for the purposes
as shown below:
Scenario 1: Assuming that there is No Redemption

Estimatedamount (S$)
in millions

As a dollar amount foreach S$1.00 of thegross proceeds due tothe Enlarged Group
from the issuance of
the Base PIPE Sharesand the Completion
Remaining Escrow
Amount (S$)

Acquire talent management agencies for
V-Livers and Livers

45

0.21

Potential acquisition of suitable live
streaming platforms (both V-Livers andLivers) to expand the user base andconsolidate market share

55

0.25

Invest into R&D and productdevelopment, with a special focus on
V-Liver/AR/AI technologies

45

0.21

Expand live streaming operations in
geographies such as Southeast Asia and
USA

40

0.18

General corporate and working capital
purposes

33

0.15

Gross proceeds due to the Enlarged
Group from the issuance of the BasePIPE Shares and the Completion
Remaining Escrow Amount

218

1.00

Application

251

LETTER TO SHAREHOLDERS
Scenario 2: Assuming that there is Maximum Redemption

Estimatedamount (S$)
in millions

As a dollar amount foreach S$1.00 of thegross proceeds due tothe Enlarged Group
from the issuance of
the Base PIPE Sharesand the Completion
Remaining Escrow
Amount (S$)

Acquire talent management agencies for
V-Livers and Livers

15

0.21

Potential acquisition of suitable live
streaming platforms (both V-Livers andLivers) to expand the user base andconsolidate market share

20

0.30

Invest into R&D and productdevelopment, with a special focus on
V-Liver/AR/AI technologies

15

0.21

Expand live streaming operations in
geographies such as Southeast Asia and
USA

10

0.14

General corporate and working capital
purposes10

0.14

Gross proceeds due to the Enlarged
Group from the issuance of the BasePIPE Shares and the Completion
Remaining Escrow Amount

70

1.00

Application

252

LETTER TO SHAREHOLDERS
Expenses
The total expenses paid and payable by the Enlarged Group in connection with the PIPE
Financing and the Proposed Business Combination are as follows:
Scenario 1: Assuming that there is No Redemption
Estimated amount(S$) in millions

Application
Professional fees and expenses incurred in connection with
the Proposed Business Combination (including the fees andexpenses payable to the Joint Financial Advisers and legal
fees)

18.75

Expenses incurred in connection with the PIPE Financing(including the placement fees and expenses payable to
the Joint Placement Agents)(1)0.53

Miscellaneous expenses (including expenses incurred inconnection with the Listing Application)

1.75

Total Expenses payable by the Enlarged Group

21.03

Note:
(1) The placement fees and expenses payable to the Joint Placement Agents are computed based on theassumptions that (a) the total non-redeemed cash proceeds are S$208 million (including but not limited tocontributions by Vertex SPV) and (b) the total proceeds raised from the PIPE Financing is S$10.0 million.

Scenario 2: Assuming that there is Maximum Redemption
Estimated amount(S$) in millions

Application
Professional fees and expenses incurred in connection with
the Proposed Business Combination (including the fees andexpenses payable to the Joint Financial Advisers and legal
fees)

16.74

Expenses incurred in connection with the PIPE Financing(including the placement fees and expenses payable to the
Joint Placement Agents)(2)0.53

Miscellaneous expenses (including expenses incurred inconnection with the Listing Application)

1.75

Total Expenses payable by the Enlarged Group

19.02

Note:
(2) The placement fees and expenses payable to the Joint Placement Agents are computed based on theassumptions that (a) the total non-redeemed cash proceeds is S$60.0 million (including but not limited tocontributions by Vertex SPV) and (b) the total proceeds raised from the PIPE Financing is S$10.0 million.

253

LETTER TO SHAREHOLDERSThe Company will pay the Joint Financial Advisers, as compensation for their services inconnection with the PIPE Financing, a base fee of 2.85% of the gross proceeds from the
PIPE Financing. This base fee will amount to approximately S$0.1425 for each Base PIPE
Share issued. In addition, the Company may, at its sole discretion, pay the Joint Financial
Advisers an incentive fee of up to 0.15% of the gross proceeds from the PIPE Financing.
This incentive fee will amount to approximately S$0.0075 for each Base PIPE Share issued.
PIPE Investors who subscribe for Base PIPE Shares will be required to pay to the Joint
Financial Advisers a brokerage fee of 1.0% of the offering price of the Base PIPE Shares(i.e. S$5.00) (together with any applicable goods and services tax on such brokerage) at thetime of settlement.
In the opinion of the Directors, no minimum amount must be raised from the issue of theBase PIPE Shares.
The Company will also pay the Joint Financial Advisers, as compensation for their services
in connection with the Proposed Business Combination, including capital markets advisory
and the role of joint financial advisers, (a) a base fee of S$1,125,000 to DBS and (b) a basefee of S$375,000 to UBS. In addition, the Company may, at its sole discretion, pay the Joint
Financial Advisers an incentive fee of up to S$500,000.
The foregoing represents the Enlarged Group’s best estimate of its allocation of theproceeds due to the Enlarged Group from the issuance of the Base PIPE Shares and theCompletion Remaining Escrow Amount based on the Enlarged Group’s current plans andestimates regarding its anticipated expenditures. Actual expenditures may vary from theseestimates, and the Enlarged Group may find it necessary or advisable to re-allocate thegross proceeds and the Completion Remaining Escrow Amount within the categories
described above or to use portions of the gross proceeds and the Completion Remaining
Escrow Amount for other purposes. The Enlarged Group will make periodic announcementson the use of gross proceeds from the issuance of the Base PIPE Shares and theCompletion Remaining Escrow Amount as and when the funds are materially utilised andwhether such use is in accordance with the stated use and in accordance with thepercentage allocated. Where there is any material deviation from the stated use ofproceeds, the Enlarged Group will announce the reasons for such deviation. The Enlarged
Group will also provide a status report on the use of proceeds in its annual report.
Pending the use of the gross proceeds and the Completion Remaining Escrow Amount in
the manner described above, the Enlarged Group may place the funds in fixed deposits withbanks and financial institutions or use the funds to invest in short-term money market
instruments, as the Proposed Directors may deem appropriate in their absolute discretion.
Any cash balances in the Enlarged Group, after the payment of the expenses listed above,
shall be managed by the Proposed Management Team in their discretion, and may be used
to discharge, reduce or retire indebtedness of the Target Company and/or the Enlarged
Group (if any), if it deems fit.
For completeness, no introducer or consultant has been engaged by the Company or theTarget Group to assist with the Restructuring, the PIPE Financing and/or in connection with
the Proposed Business Combination.

254

LETTER TO SHAREHOLDERS
23.

ENLARGED GROUP CORPORATE AND SHAREHOLDING STRUCTURE

23.1 Corporate Structure of the Company before Completion
The Company has no subsidiaries as at the Latest Practicable Date.
23.2 Corporate Structure of the Target Group as at the date of this Circular
As at the date of this Circular, the corporate structure of the Target Group is set out in the
diagram below:
Series AA
Preference
Shareholders

Ordinary
Shareholders

13.08%*

Series A
Preference
Shareholders

Series B
Preference
Shareholders

22.77%*

3.53%*

Series C
Preference
Shareholders

Series D
Preference
Shareholders

7.49%*

30.82%*

Warrants
Holders

7.67%*

17LIVE
Cayman ESOP

14.05%*

0.58%*

17LIVE Cayman(Cayman Islands)

100%

100%

Ichi Nana Inc.(1)(British Virgin Islands)

17LIVE Japan Inc.
(Japan)100%
17LIVE(USA)
Corp.
(UnitedStates)100%
Next
Entertainment(Hong Kong)
Limited(1)(Hong Kong)
100%

Next Entertainment Science &Technology (Beijing) Co., Ltd.(1)(People’s Republic of China)

100%

17LIVE
Ltd.
(Hong
Kong)

100%

100%

17LIVE(SEA) Pte.
Ltd.
(Singapore)

17LIVE(Taiwan)Limited(Taiwan)

0.01%

100%

Next
Entertainment
Inc.
(Taiwan)

100%

Wave
Inc.
(Taiwan)100%

Handsup
Inc.
(Taiwan)

99.99%

Liontrek Entertainment India
Pvt. Ltd.
(India)* calculated on a fully-diluted basis based on the latest cap
table of 17LIVE Cayman(1)
this entity is currently dormant and will be wound up

Note:
For completeness, each of NEGH, NEHK, NEBJ, Ichi Nana Inc. and Machipopo forms part of the Target Groupduring FY2020, FY2021 and FY2022 but was wound up or in the process of winding up as of the Latest Practicable
Date as these entities no longer serve any function within the Target Group. In respect of Machipopo and Ichi Nana
Inc., their respective historical functions relating to 17LIVE have been consolidated and assumed by 17LIVE
Japan, as part of the Target Group’s internal restructuring to streamline the group structure and improve
operational efficiency. In respect of NEGH, NEHK and NEBJ, their respective historical functions relating to MeMe
Live have ceased upon the integration of MeMe Live into 17LIVE to achieve greater synergy between the two live
streaming businesses. This is part of the Target Group’s internal restructuring pre-Completion which will not havematerial impact on the Target Group’s business or operation as a whole. In respect of the winding up/dissolutionof these entities which would be completed after Completion, there would not be material adverse implications to
the Enlarged Group’s business operations in the event that any such entity was not wound up/dissolved
post-Completion, because all of these entities have ceased operations and are dormant; and (ii) the Enlarged
Group will be responsible for ensuring that the above entities are wound up/dissolved and will bear the costs ofsuch actions, and the Target Group does not expect such costs to be significant.

255

LETTER TO SHAREHOLDERS
The corporate information on the Target Company is set out below:
Registration number:

320106

Date of incorporation:

28 February 2017

Country of incorporation:

Cayman Islands

Principal activities:(a) live streaming software, websites orapplications, and (b) e-commerce platforms

Address of registered office:

Harneys Fiduciary (Cayman) Limited, 4th Floor,
Harbour Place, 103 South Church Street,
P.O. Box 10240, Grand Cayman KY1-1002,
Cayman Islands

Principal place of business:

2-12-28, Kita-Aoyama, Minato City,
Tokyo, Japan

Issued and paid-up share capital:

US$24,802.6 comprising 248,025,621 shares(1)Present directors:

Mr. Akio Tanaka
Mr. Phua Jiexian Joseph
Mr. Huang Li-An
Mr. Chihoon Hyun
Mr. Joo Hock Chua
Mr. Kin Chung Terry Tsang
Mr. Hock Chuan Tam

Present auditor:

Ernst & Young LLP

Note:(1) Excludes the issuance of 3,018,833 ratchet shares

The Target Company’s telephone number at the principal place of business is(+81) 364475056. The website address and email address of the Target Company are
https://about.17.live/and investor_relations@17.live, respectively. The Target Company
does not have a facsimile number. The information on the Target Company’s website or any
website directly or indirectly linked to such website or the websites of any of its related
corporations or other entities in which the Target Company may have an interest is notincorporated by reference into this Circular and should not be relied on.
The Target Company is not listed on any stock exchange. The Target Company
previously applied for a listing on the New York Stock Exchange on 11 May 2018 but thiswas withdrawn on 7 June 2018 due to certain administrative issues with one of theTarget Company’s institutional investors which was unable to complete the relevant
know-your-customer procedures in time for the listing of the Target Company’s shares on
the New York Stock Exchange. Given this delay, and the market speculation in relation to
the Target Company’s proposed listing, the board of the Target Company determined thatthe listing on the New York Stock Exchange was not in the best interests of the shareholdersof the Target Company, and withdrew its application for listing. This particular institutional
investor did not become a shareholder of the Target Company after the listing application
was withdrawn. Prior to this withdrawal, the Target Company received all the necessary
corporate and regulatory approvals (including from the New York Stock Exchange) in
relation to its listing.

256

LETTER TO SHAREHOLDERS
As at the Latest Practicable Date, the details of the subsidiaries of the Enlarged Group,
which, in each case, account for 10% or more of the net assets, net liabilities or profit or loss
before tax of the Target Group for any of FY2020, FY2021 and FY2022, are as follows:

Name

Country of Incorporation/
Principal Place ofBusiness

17LIVE Cayman

Cayman Islands

17LIVE HK

Hong Kong

17LIVE Japan

Japan

NEHK

Hong Kong

Principal
Activities

Proportion of
Ownership
Interest

Live streaming

100%

The directors and auditors of the principal subsidiaries of the Target Group are set out
below:

Principal Subsidiary

AuditorDirector/Responsible
Person17LIVE Japan

Not required to be audited in
the country of incorporation(1)Lien Chien-Lin

17LIVE Taiwan

Ernst & Young, Taiwan

Lien Chien-Lin

Ichi Nana Inc. Taiwan Branch Ernst & Young, Taiwan

Lien Chien-Lin

Note:(1) Audited by Ernst & Young LLP for consolidation purposes.

Although Ernst & Young LLP was not appointed as the auditor for 17LIVE Japan, for the
purposes of the Proposed Business Combination, 17LIVE Japan was audited by a member
firm of Ernst & Young Global, namely Ernst & Young Japan, for the purposes of groupconsolidation reporting to Ernst & Young LLP. The Company expects this arrangement tocontinue post-Completion, with Ernst & Young LLP as the independent auditor to the Target
Group, and Ernst & Young LLP being appointed as the independent auditor to the Company
and the Enlarged Group, subject to Shareholders’ approval being obtained for the Proposed
Transactions and for the Proposed Change of the Company’s Independent Auditor.
None of the Proposed Independent Directors (namely Mr. Tan Hup Foi, Dr. Steve Lai Mun
Fook, Mr. Hideto Mizuno and Ms. Chen Xiuling) sits or will sit on the board of the Enlarged
Group’s principal subsidiaries based in jurisdictions outside Singapore.

257

LETTER TO SHAREHOLDERS
23.3 Corporate Structure of the Enlarged Group after Completion
Upon Completion, the corporate structure of the Enlarged Group comprising the Company
and the Target Group is expected to be as set out in the diagram below:
17LIVE Holdco Shareholders
and Company ESOPPIPE Investors

77.2%(1)/91.5%(2)VTAC shareholders

1.1%(1)/1.3%(2)EIS

21.8%(1)/7.2%(2)

0%

VTAC
(Cayman Islands)
100%

17LIVE Cayman(Cayman Islands)
100%

17LIVE Japan Inc.
(Japan)100%

17LIVE(USA)
Corp.
(UnitedStates)100%

Next
Entertainment(Hong Kong)
Limited(3)(Hong Kong)

100%

17LIVE
Ltd.
(Hong
Kong)

100%

100%

17LIVE(Taiwan)Limited(Taiwan)

17LIVE (SEA)
Pte. Ltd.
(Singapore)

0.01%

100%

Next
Entertainment
Inc.
(Taiwan)

100%

Wave
Inc.
(Taiwan)100%

Handsup
Inc.
(Taiwan)

99.99%

Liontrek Entertainment India
Pvt. Ltd.
(India)Notes:(1) Pro forma shareholding percentages are based on the assumptions that (i) 2,000,000 Base PIPE Shares areallotted and issued to PIPE Investors, and (ii) there is No Redemption.
(2) Pro forma shareholding percentages are based on the assumptions that (i) 2,000,000 Base PIPE Shares areallotted and issued to PIPE Investors, and (ii) there is Maximum Redemption.
(3) This entity is currently dormant and will be wound up.

23.4 SHARE CAPITAL OF THE TARGET COMPANY
As of the Latest Practicable Date, the issued and paid-up share capital of the Target
Company was approximately US$24,802.6 divided into 248,025,621 shares (excluding theissuance of 3,018,833 ratchet shares). The number of outstanding shares is 247,734,422
and 247,462,819 as of 1 January 2022 and 31 December 2022, respectively.

258

LETTER TO SHAREHOLDERS
As of the Latest Practicable Date, there are six classes of shares in the capital of the Target
Company, being ordinary shares, series AA preference shares, series A preference shares,series B preference shares, series C preference shares and series D preference shares. Allof the issued shares of the Target Company are fully paid-up. The rights and privileges
attached to the Target Company’s shares are stated in the Ninth Amended and RestatedMemorandum and Articles of Association. The following table sets forth the details of eachclass of share of the Target Company:

OrdinarysharesSeries AA
Series D
Series A
Series B
Series C
preference preference preference preference preference
sharessharessharessharessharesNumber ofshares issued
and fully paid

37,923,882

10,241,153

66,017,310

89,639,530

21,981,529

22,222,217

Number ofshares as at
1 January 2022

38,195,485

10,241,153

66,017,310

89,350,622

21,707,635

22,222,217

Number ofshares as at
31 December
2022

37,923,882

10,241,153

66,017,310

89,350,622

21,707,635

22,222,217

There has been no change in the voting rights attached to the shares of the Target
Company in the three years prior to the Latest Practicable Date.
During the three years prior to the lodgement of this Circular, the Target Company did notissue any shares for a consideration other than for cash.
The Target Company adopted the 17LIVE Cayman ESOP in 2017, 2018 and 2020,
respectively, pursuant to which 17LIVE RSUs are authorised to be granted to acquire theshares in the capital of the Target Company.
Pursuant to resolutions passed at the extraordinary general meeting of the Target Company
on 19 December 2019 and 31 March 2020, the written resolutions of the board of directorsof the Target Company on 10 November 2020, 22 July 2021, and the confirmation by thegeneral counsel on 25 November 2021, the shareholders and the board of directors of theTarget Company approved, inter alia, the following:(a)the creation and issuance of series AA preference shares of the Target Company;(b)

the creation and issuance of series D preference shares of the Target Company;(c)the repurchase of ordinary shares, series AA preference shares, series A preference
shares and series B preference shares of the Target Company; and(d)the increase in the number of ordinary shares of the Target Company to be issued
under the 17LIVE Cayman ESOP.

There are no shares in the Target Company that are held by or on behalf of the Target
Company or by the subsidiaries of the Target Company.

259

LETTER TO SHAREHOLDERS
Changes in Issued Share Capital
Details of the changes in the issued and paid-up capital of the Target Company and its
subsidiaries for the last three years prior to the Latest Practicable Date are set out in thetable below:
The Target Company
ResultantIssued Share
CapitalDate

Price PerShare

No. of Shares
Issued/Reduced

Purpose of Issue/
Reduction

1 January 2020

US$0.0001

9,964,361 series
AA preference
shares issued

Allotment to certain
holders of series AA
preference shares

US$25,090.80

9 April 2020

US$0.0001

13,888,886
series D
preference
shares issued

Allotment to certain
holders of series D
preference shares

US$26,479.70

30 April 2020

US$0.0001

1,587,300 series
D preference
shares issued

Allotment to a holder
of series D
preference shares

US$26,638.40

26 August 2020

US$0.0001

1,984,126 series
D preference
shares forfeited

Forfeiture from aholder of series D
preference shares

US$26,440.00

1 September
2020

US$0.0001

8,730,157 series
D preference
shares issued

Allotment to certain
holders of series D
preference shares

US$27,313.00

11 November
2020

US$0.0001

25,991,209
ordinary shares
repurchased

Repurchase from aholder of ordinary
shares

US$24,713.90

30 June 2021

US$0.0001

1,107,156 series
AA preference
shares issued

Allotment to certain
holders of series AA
preference shares

US$24,824.60

22 July 2021

US$0.0001

286,942 ordinary
sharesrepurchased

Repurchase from aholder of ordinary
shares

US$24,318.60

4,773,386 series
A preference
sharesrepurchased

Repurchase fromcertain holders ofseries A preference
shares

10,404,605
ordinary sharesissuedAllotment to a holderof 17LIVE RSUs
pursuant to the
17LIVE Cayman
ESOP

2 August 2021

US$0.0001

260

US$25,359.00

LETTER TO SHAREHOLDERS

Date

Price PerShare

No. of Shares
Issued/Reduced

Purpose of Issue/
Reduction

4 November 2021

US$0.0001

686,453 ordinary
sharesrepurchased

Repurchase fromcertain holders ofordinary shares

830,364
series AA
preference
sharesrepurchased

Repurchase fromcertain holders ofseries AA preference
shares2,819,402
series A
preference
sharesrepurchased

Repurchase fromcertain holders ofseries A preference
shares1,519,605
series B
preference
sharesrepurchased

Repurchase fromcertain holders ofseries B preference
sharesResultantIssued Share
Capital
US$24,773.40

5 November 2021

US$0.0001

271,603 ordinary
sharesrepurchased

Repurchase from aholder of ordinary
shares

US$24,746.30

23 September
2023

US$0.0001

99,796 series B
preference
shares issued

Allotment to a holder
of series B
preference shares

US$24,756.28

17 October 2023

US$0.0001

189,112 series B
preference
shares issued

Allotment to a holder
of series B
preference shares

US$24,802.58

273,894 series C
preference
shares issued

Allotment to a holder
of series C
preference shares

Price PerShare

No. of Shares
Issued/Reduced

Purpose of Issue/
Reduction

17 August 2021

NT$10

1,000,000
ordinary sharesissuedRegistered capital on
incorporation

NT$10,000,000

27 March 2023

NT$10

12,791,000
ordinary sharesissuedDivision

NT$137,910,000

17LIVE Taiwan

Date

261

ResultantIssued Share
CapitalLETTER TO SHAREHOLDERS
HandsUp

Date
20 April 2020

Price PerShare

No. of Shares
Issued/Reduced

Purpose of Issue/
Reduction

NT$10

2,997,000
ordinary sharesissuedAllotment to holder ofordinary shares

Price PerShare

No. of Shares
Issued/Reduced

Purpose of Issue/
Reduction

NT$10

1,000,000
ordinary sharesissuedRegistered capital on
incorporation

Price PerShare

No. of Shares
Issued/Reduced

Purpose of Issue/
Reduction

NT$10

2,500,000
ordinary sharesissuedAllotment to holder ofordinary shares

Price PerShare

No. of Shares
Issued/Reduced

Purpose of Issue/
Reduction

S$1

1 ordinary shareissuedRegistered capital on
incorporation

Price PerShare

No. of Shares
Issued/Reduced

Purpose of Issue/
Reduction

US$1

100
non-assessablecommon stocks
issuedRegistered capital on
incorporation

ResultantIssued Share
Capital
NT$30,000,000

NEI

Date
31 August 2021

ResultantIssued Share
Capital
NT$10,000,000

Wave

Date
3 June 2021

ResultantIssued Share
Capital
NT$25,010,000

17LIVE SEA

Date
6 December 2021

ResultantIssued Share
Capital
S$1

17LIVE USA

Date
29 January 2021

262

ResultantIssued Share
Capital
US$100LETTER TO SHAREHOLDERS
17LIVE Japan
The issued and paid-up share capital of 17LIVE Japan was JPY100,000 as of the Latest
Practicable Date. There has been no change in the issued and paid-up share capital, andvoting rights attached to the shares of the 17LIVE Japan in the three years prior to theLatest Practicable Date.
17LIVE HK
The issued and paid-up share capital of 17LIVE HK was US$10,000 as of the Latest
Practicable Date. There has been no change in the issued and paid-up share capital, andvoting rights attached to the shares of the 17LIVE HK in the three years prior to the Latest
Practicable Date.
Liontrek
The issued and paid-up share capital of Liontrek was INR 9,711,000 as of the Latest
Practicable Date. There has been no change in the issued and paid-up share capital, andvoting rights attached to the shares of the Liontrek in the three years prior to the Latest
Practicable Date.
Restructuring
Pursuant to the Restructuring, the 17LIVE Cayman Shareholders will transfer theirrespective shares in the Target Company to the Vendor. At Completion, the share capital of
the Target Company will be converted and re-designated into one single class of ordinary
shares. Following the Completion of the Proposed Business Combination, the Target
Company will become a subsidiary of the Company. The Restructuring will not affect theshare capital of 17LIVE Taiwan, HandsUp, NEI, Wave, 17LIVE SEA, 17LIVE USA, 17LIVE
Japan, 17LIVE HK and Liontrek.
23.5 Changes in Shareholding Structure
As at the Latest Practicable Date, the Company’s issued and paid-up share capitalcomprises 41,606,000 Shares. The Enlarged Share Capital upon Completion after the
Proposed Business Combination, the Proposed Allotment and Issuance of theConsideration Shares, the Proposed Allotment and Issuance of the Base PIPE Shares andthe Proposed Allotment and Issuance of the Special Bonus Shares (the “Proposed
Completion Transactions”) will comprise 207,529,251 Shares (assuming that there is No
Redemption and that the total proceeds raised from the PIPE Financing is S$10.0 million)and 174,962,651 Shares (assuming that there is Maximum Redemption and that the total
proceeds raised from the PIPE Financing is S$10.0 million).
Details of the changes in the aggregate interest (direct and indirect) of the Company before
and after the Proposed Completion Transactions are set out in the table below:

263

LETTER TO SHAREHOLDERSSIGNIFICANT CHANGES IN PERCENTAGE OF OWNERSHIPThe following table sets forth the significant changes in the shareholding interests of the Directorsof the Company, the Proposed Directors of the Resulting Issuer and select shareholders (including
Substantial Shareholders) of the Company and the Resulting Issuer since the Latest Practicable
Date to (a) after Completion of the Proposed Business Combination, the Proposed Allotment andIssuance of the Consideration Shares and the Proposed Allotment and Issuance of the Special
Bonus Shares, and (b) after Completion of the Proposed Business Combination, the Proposed
Allotment and Issuance of the Consideration Shares, the Proposed Allotment and Issuance of theBase PIPE Shares and the Proposed Allotment and Issuance of the Special Bonus Shares. Saveas disclosed below, there were no significant changes in the percentage of ownership of theCompany in the last three years prior to the Latest Practicable Date. Save as disclosed below, tothe best of the knowledge of the Directors, the Company is not directly or indirectly owned orcontrolled, whether severally or jointly, by any other person or government and there is no known
arrangement, the operation of which may, at a subsequent date, result in a change in the controlof the Company.

264

–

–

–

–

–

Ms. Anupama Sawhney

Dr. Steve Lai Mun Fook

Mr. Low Seow Juan

Mr. Tan Hup Foi

–

–

–

–

Dr. Steve Lai Mun Fook

Ms. Chen Xiuling

Mr. Hideto Mizuno–

Mr. Tan Hup Foi

Mr. Lien Chien-Lin–

Mr. Akio Tanaka(3)(3A)–

Mr. Phua Jiexian Joseph (3)Proposed Directors of the Resulting Issuer–

Mr. Jiang Honghui

No. of Shares

Mr. Chua Kee Lock

Directors of the Company

Name

Direct interest

–

–

–

–

–

–

–

–

–

–

–

–

–

%

–

–

–

–

–

–

–

–

–

–

–

–

–

No. of Shares

Indirect interest

As at the Latest Practicable Date

Scenario 1: Assuming that there is No Redemption

–

–

–

–

–

–

–

–

–

–

–

–

–

%

265

–

–

–

–

1,167,728

–

–

–

–

–

–

–

–

No. of Shares

Direct interest

–

–

–

–

0.57%

–

–

–

–

–

–

–

–

%

–

–

–

–

–

–

–

–

–

–

9.47%
19,453,132

7.82%
(26)

–

–

–

–

–

–

%

16,055,627(4)

–

–

–

–

–

–

No. of Shares

Indirect interest

After the Proposed Business Combination,
the Proposed Allotment andIssuance of the Consideration Shares(1A)
and the Proposed Allotment
and Issuance of Special Bonus Shares(1B)

LETTER TO SHAREHOLDERS

–

–

–

–

1,167,728

–

–

–

–

–

–

–

–

No. of Shares

Direct interest

–

–

–

–

0.56%

–

–

–

–

–

–

–

–

%

–

–

–

–

–

19,453,132(26)

16,055,627(4)

–

–

–

–

–

–

No. of Shares

–

–

–

–

–

–

%

–

–

–

–

–

9.37%

7.74%

Indirect interest

After the Proposed Business Combination,
the Proposed Allotment and Issuance of
the Consideration Shares(1A), the Proposed Allotment
and Issuance of the Base PIPE Shares(1C) and the
Proposed Allotment
and Issuance of Special Bonus Shares(1B)

–

–

–

–

–

–

–

–

FFMC Holdings Pte. Ltd.

Seviora Holdings Pte. Ltd.

Pilatus Investments Pte. Ltd.

Tembusu (3)Temasek

NTUC Income Holdings Pte. Ltd.

2,600,000(10)–Fullerton Fund Management
Company Ltd.

Income Insurance Limited(formerly known as NTUC Income
Insurance Co-operative Limited)

Napier Investments Pte. Ltd.

6,000,000

Fullerton (Private) Limited

Venezio (3)

–

–

–

6,000,000

No. of Shares

Ellensburg Holding Pte. Ltd.

Sponsor(3)

Vertex Master Fund I Pte. Ltd.

Vertex SPV(3)Select Shareholders who are not
Directors(2)

Name

%

–

–

–

–

–

–

–

6.25%

–

14.42%––––

14.42%

Direct interest

6.25%
6.25%
6.25%

(12)
(13)

2,600,000(14)35.09%
6.25%

(16)

(17)

2,600,000

14,600,000

20.67%

8,600,000(15)2,600,000

2,600,000

6.25%

–

2,600,000(11)–14.42%

14.42%

6,000,000(9)14.42%(8)–

14.42%(7)–

6,000,000

6,000,000

6,000,000

14.42%

6,000,000(5)
(5)

–

%

–

No. of Shares

Indirect interest

As at the Latest Practicable Date

266

–

–

–

–

–

–

–

2,860,000(10)–6,600,000

–

–

–

–

6,000,000

No. of Shares

Direct interest

–

–

–

–

–

–

–

1.39%

–

3.21%

–

–

–

–

2.92%

%

(8)

(7)

(21)

2,860,000

45,534,496

(17)

(16A)

9,735,271(15A)

3,135,271(14A)

3,135,271

2,860,000(12)

2,860,000(11)–6,600,000(9)–30,057,918

30,057,918

30,057,918(5)(6)

6,000,000(5)–No. of Shares

–

%

1.39%

22.18%

4.74%

1.53%

1.53%

1.39%

1.39%

–

3.21%

–

14.64%

14.64%

14.64%

2.92%

Indirect interest

After the Proposed Business Combination,
the Proposed Allotment andIssuance of the Consideration Shares(1A)
and the Proposed Allotment
and Issuance of Special Bonus Shares(1B)

LETTER TO SHAREHOLDERS

–

–

–

–

–

–

–

2,860,000(10)–6,600,000

–

–

–

–

6,000,000

No. of Shares

Direct interest

–

–

–

–

–

–

–

1.38%

–

3.18%

–

–

–

–

2.89%

%

(8)

(7)

(21)

2,860,000

45,534,496

(17)

(16A)

9,735,271(15A)

3,135,271(14A)

3,135,271

2,860,000(12)

2,860,000(11)–6,600,000(9)–30,057,918

30,057,918

30,057,918(5)(6)

6,000,000(5)–No. of Shares

–

%

1.38%

21.94%

4.69%

1.51%

1.51%

1.38%

1.38%

–

3.18%

–

14.48%

14.48%

14.48%

2.89%

Indirect interest

After the Proposed Business Combination,
the Proposed Allotment and Issuance of
the Consideration Shares(1A), the Proposed Allotment
and Issuance of the Base PIPE Shares(1C) and the
Proposed Allotment
and Issuance of Special Bonus Shares(1B)

–

–

–

Pav Investments Pte. Ltd.

UBS Group AG

UBS AG

Chia Nine Investment Co., Ltd.

(3)

–

–

–

KTB China Synergy Fund(3)M17 Growth SPV B LLC

–

(3)

–

–

Infinity e.Ventures Asia III, L.P.(3)Vertex Growth Fund Pte. Ltd.

–

–

–

Vertex Ventures SEA Fund III Pte.
Ltd. (3)(3)

Vertex Legacy Continuation Fund
Pte. Ltd. (3)Dragon Alexander Limited

Aika Tong

(3)

(3)

–

Innoven Capital Singapore Pte. Ltd.

––

National Trades Union Congress

M17 Growth SPV LLC–

NTUC Foundation Limited(3)–

No. of Shares

NTUC Enterprise Co-operative Limited

Name

Direct interest

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

%

6.25%
6.25%

(19)
(20)

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

9.93%

4,132,200(23)
–

–
9.93%

–
4,132,200(23)–2,600,000–

6.25%

2,600,000(18)2,600,000%

No. of Shares

Indirect interest

As at the Latest Practicable Date

(4)

267

485,353

1,571,494

9,384,654

19,453,132

2,705,514

6,908,725

14,443,679

16,055,627

201,266

18,703,753––

5,741,307(22)

275,271–––

No. of Shares

Direct interest

0.24%

0.77%

4.57%

9.47%

1.32%

3.36%

7.03%

7.82%

0.10%

9.11%

–

–

2.80%

0.13%

–

–

–

%

(20)

–

–

–

–

–

–

–

–

25,795,543

1,571,494

(25)

(24)

4,545,420(23)4,545,420(23)––2,860,000

2,860,000(19)

2,860,000(18)No. of Shares

%

–

–

–

–

–

–

–

–

12.56%

0.77%

2.21%

2.21%

–

–

1.39%

1.39%

1.39%

Indirect interest

After the Proposed Business Combination,
the Proposed Allotment andIssuance of the Consideration Shares(1A)
and the Proposed Allotment
and Issuance of Special Bonus Shares(1B)

LETTER TO SHAREHOLDERS(4)

485,353

1,571,494

9,384,654

19,453,132

2,705,514

6,908,725

14,443,679

16,055,627

201,266

18,703,753––

5,741,307(22)

275,271–––

No. of Shares

Direct interest

0.23%

0.76%

4.52%

9.37%

1.30%

3.33%

6.96%

7.74%

0.10%

9.01%

–

–

2.77%

0.13%

–

–

–

%

(20)

–

–

–

–

–

–

–

–

25,795,543

1,571,494

(25)

(24)

4,545,420(23)4,545,420(23)––2,860,000

2,860,000(19)

2,860,000(18)No. of Shares

%

–

–

–

–

–

–

–

–

12.43%

0.76%

2.19%

2.19%

–

–

1.38%

1.38%

1.38%

Indirect interest

After the Proposed Business Combination,
the Proposed Allotment and Issuance of
the Consideration Shares(1A), the Proposed Allotment
and Issuance of the Base PIPE Shares(1C) and the
Proposed Allotment
and Issuance of Special Bonus Shares(1B)

–

–

–

–

No. of Shares

–

–

–

–

%

–

–

–

–

–

Mr. Jiang Honghui

Ms. Anupama Sawhney

No. of Shares

Mr. Chua Kee Lock

Directors of the Company

Name

–

–

–

%

–

–

–

No. of Shares

Indirect interest

As at the Latest Practicable Date

Direct interest

–

–

%

2,723,387

2,311,556

No. of Shares

Direct interest

1.33%

1.13%

%

–

–

No. of Shares

Indirect interest

–

–

%

2,723,387

2,311,556

No. of Shares

Direct interest

–

–

–

%

–

–

2.06%
0.01%

–
–

–
–

268

–

–

–

No. of Shares

Direct interest

–

–

–

%

–

–

–

No. of Shares

Indirect interest

–

–

–

%

After the Proposed Business Combination,
the Proposed Allotment and Issuance of theConsideration Shares(1A) and the Proposed Allotment
and Issuance of Special Bonus Shares(1B)

30,333

4,234,319

2.04%
0.01%

–

–

–

–

No. of Shares

–

–

–

–

%

–

–

–

No. of Shares

Direct interest

–

–

–

%

–

–

–

No. of Shares

Indirect interest

–

–

–

%

After the Proposed Business Combination,
the Proposed Allotment and Issuance of theConsideration Shares(1A), the Proposed Allotment andIssuance of the Base PIPE Shares(1C) and the Proposed
Allotment and Issuance of Special Bonus Shares(1B)

30,333

4,234,319

1.31%

1.11%

%

Indirect interest

After the Proposed Business Combination,
the Proposed Allotment and Issuance of
the Consideration Shares(1A), the Proposed Allotment
and Issuance of the Base PIPE Shares(1C) and the
Proposed Allotment
and Issuance of Special Bonus Shares(1B)

Please refer to the row under the heading “Proposed Directors of the Resulting Issuer” above for details.

––

No. of Shares

Indirect interest

Scenario 2: Assuming that there is Maximum Redemption

Mr. Kenta Masuda(3)(3A)

Mr. Ng Jing Shen

(3)(3A)

Mr. Lien Chien-Lin(3)(3A)

Key Executives(3)(3B)

Talent Dragon Co., Ltd.

(3)

North Park Advisory Ltd.(3)Name

Direct interest

As at the Latest Practicable Date

After the Proposed Business Combination,
the Proposed Allotment andIssuance of the Consideration Shares(1A)
and the Proposed Allotment
and Issuance of Special Bonus Shares(1B)

LETTER TO SHAREHOLDERS––

Mr. Low Seow Juan

Mr. Tan Hup Foi

–

–

–

–

Dr. Steve Lai Mun Fook

Ms. Chen Xiuling

Mr. Hideto Mizuno–

Mr. Tan Hup Foi

Mr. Lien Chien-Lin–

Mr. Akio Tanaka(3)(3A)–

Mr. Phua Jiexian Joseph (3)Proposed Directors of the Resulting Issuer–

No. of Shares

Dr. Steve Lai Mun Fook

Name

Direct interest

–

–

–

–

–

–

–

–

–

–

%

–

–

–

–

–

–

–

–

–

–

No. of Shares

Indirect interest

As at the Latest Practicable Date

–

–

–

–

–

–

–

–

–

–

%

269

–

–

–

–

1,167,728

–

–

–

–

–

No. of Shares

Direct interest

–

–

–

–

0.68%

–

–

–

–

–

%

–

–

–

–

–

–

–

–

–

–

11.26%(26)

19,453,132

9.29%

–

–

–

%

16,055,627(4)

–

–

–

No. of Shares

Indirect interest

After the Proposed Business Combination,
the Proposed Allotment and Issuance of theConsideration Shares(1A) and the Proposed Allotment
and Issuance of Special Bonus Shares(1B)

LETTER TO SHAREHOLDERS

–

–

–

–

1,167,728

–

–

–

–

–

No. of Shares

Direct interest

–

–

–

–

0.67%

–

–

–

–

–

%

–

–

–

–

–

19,453,132(26)

16,055,627(4)

–

–

–

No. of Shares

–

–

–

%

–

–

–

–

–

11.12%

9.18%

Indirect interest

After the Proposed Business Combination,
the Proposed Allotment and Issuance of theConsideration Shares(1A), the Proposed Allotment andIssuance of the Base PIPE Shares(1C) and the Proposed
Allotment and Issuance of Special Bonus Shares(1B)No. of Shares

Napier Investments Pte. Ltd.

–

–

–

–

–

Temasek

NTUC Income Holdings Pte. Ltd.

NTUC Enterprise Co-operative Limited–

Seviora Holdings Pte. Ltd.

Tembusu (3)–FFMC Holdings Pte. Ltd.

Pilatus Investments Pte. Ltd.

–2,600,000(10)

–

–

–

–

–

–

–

–

6.25%

–

–

Fullerton Fund Management
Company Ltd.

Income Insurance Limited(formerly known as NTUC Income
Insurance Co-operative Limited)

14.42%––––

14.42%%

6,000,000–

Fullerton (Private) Limited

Venezio–

Ellensburg Holding Pte. Ltd.

(3)

–

–

Vertex Master Fund I Pte. Ltd.

6,000,000

Sponsor (3)Vertex SPV(3)Select Shareholders who are not Directors(2)NameDirect interest

6.25%
6.25%
6.25%

(13)
(14)

35.09%
6.25%
6.25%

14,600,000(16)
(17)
(18)

2,600,000

2,600,000

20.67%

8,600,000(15)2,600,000

2,600,000

2,600,000

6.25%

(12)

–

14.42%–

2,600,000(11)–6,000,000–(9)14.42%(8)

6,000,000

14.42%

6,000,000(7)14.42%–

14.42%(5)%

6,000,000(5)6,000,000–

No. of Shares

Indirect interest

As at the Latest Practicable Date

270

–

–

–

–

–

–

–

–

–

–

6,600,000

–

–

–

–

6,000,000

No. of Shares

Direct interest

–

–

–

–

–

–

–

–

–

–

3.82%

–

–

–

–

3.47%

%

(5)

–

–

42,674,496(16A)

6,875,271(15A)

275,271

(21)

(9)

(14A)

275,271–––

6,600,000–

30,057,918(8)

30,057,918(7)30,057,918(5)(6)6,000,000–

No. of Shares

–

%

–

–

24.70%

3.98%

0.16%

0.16%

–

–

–

3.82%

–

17.40%

17.40%

17.40%

3.47%

Indirect interest

After the Proposed Business Combination,
the Proposed Allotment and Issuance of theConsideration Shares(1A) and the Proposed Allotment
and Issuance of Special Bonus Shares(1B)

LETTER TO SHAREHOLDERS

–

–

–

–

–

–

–

–

–

–

6,600,000

–

–

–

–

6,000,000

No. of Shares

Direct interest

–

–

–

–

–

–

–

–

–

–

3.77%

–

–

–

–

3.43%

%

(5)

–

–

42,674,496(16A)

6,875,271(15A)

275,271

(21)

(9)

(14A)

275,271–––

6,600,000–

30,057,918(8)

30,057,918(7)30,057,918(5)(6)6,000,000–

No. of Shares

–

%

–

–

24.39%

3.93%

0.16%

0.16%

–

–

–

3.77%

–

17.18%

17.18%

17.18%

3.43%

Indirect interest

After the Proposed Business Combination,
the Proposed Allotment and Issuance of theConsideration Shares(1A), the Proposed Allotment andIssuance of the Base PIPE Shares(1C) and the Proposed
Allotment and Issuance of Special Bonus Shares(1B)Talent Dragon Co., Ltd.(3)North Park Advisory Ltd.

(3)

Chia Nine Investment Co., Ltd.

M17 Growth SPV B LLC

(3)

(3)

–

Infinity e.Ventures Asia III, L.P.(3)

–

–

–

–

–

–

Vertex Ventures SEA Fund III Pte.
Ltd. (3)

KTB China Synergy Fund–

Vertex Growth Fund Pte. Ltd.(3)(3)–

Vertex Legacy Continuation
Fund Pte. Ltd. (3)––Aika Tong

Dragon Alexander Limited(3)

(3)

–

–

UBS AG

M17 Growth SPV LLC–UBS Group AG

(3)

–

–

Innoven Capital Singapore Pte. Ltd.

–

National Trades Union Congress

Pav Investments Pte. Ltd.

–

No. of Shares

NTUC Foundation Limited

Name

Direct interest

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

%

6.25%

(20)

9.93%

(23)

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

9.93%

4,132,200(23)4,132,200

–

–
–

–

6.25%

2,600,000 (19)2,600,000%

No. of Shares

Indirect interest

As at the Latest Practicable Date271

2,723,387

2,311,556

485,353

1,571,494

9,384,654

19,453,132

2,705,514

6,908,725

14,443,679

16,055,627(4)201,266

18,703,753

–

–

1.58%

1.34%

0.28%

0.91%

5.43%

11.26%

1.57%

4.00%

8.36%

9.29%

0.12%

10.83%

–

–

0.16%
3.32%

275,271––%

5,741,307(22)––No. of Shares

Direct interest

–

–

–

–

–

–

–

–

–

–

(25)

(24)

25,795,543

1,571,494

–

–

–

–

–

–

No. of Shares

–

–

–

–

–

–

%

–

–

–

–

–

–

–

–

–

–

14.93%

0.91%

Indirect interest

After the Proposed Business Combination,
the Proposed Allotment and Issuance of theConsideration Shares(1A) and the Proposed Allotment
and Issuance of Special Bonus Shares(1B)

LETTER TO SHAREHOLDERS

2,723,387

2,311,556

485,353

1,571,494

9,384,654

19,453,132

2,705,514

6,908,725

14,443,679

16,055,627(4)201,266

18,703,753––

5,741,307(22)275,271––

No. of Shares

–

–

3.28%

0.16%

–

–

%

1.56%

1.32%

0.28%

0.90%

5.36%

11.12%

1.55%

3.95%

8.26%

9.18%

0.12%

10.69%

Direct interest

–

–

–

–

–

–

–

–

–

–

(25)

(24)

25,795,543

1,571,494

–

–

–

–

–

–

No. of Shares

–

–

–

–

–

–

%

–

–

–

–

–

–

–

–

–

–

14.74%

0.90%

Indirect interest

After the Proposed Business Combination,
the Proposed Allotment and Issuance of theConsideration Shares(1A), the Proposed Allotment andIssuance of the Base PIPE Shares(1C) and the Proposed
Allotment and Issuance of Special Bonus Shares(1B)%

No. of Shares%

No. of Shares%

No. of Shares

Direct interest––
30,333

4,234,319

2.45%
0.02%

–
–

–
–

30,333

4,234,319

0.02%

2.42%

%

–

–

No. of Shares

Indirect interest

–

–

%

This Shareholder will enter into lock-up arrangements with the Joint Financial Advisers. Please see Section 23.7 titled “Enlarged Group Corporate and Shareholding Structure –Moratorium” of this Circular for further details.

17LIVE Unvested RSU Holders will be allotted and issued ESOP Shares under the Company ESOP to be adopted in connection with the Proposed Business Combination. This
Shareholder is also a 17LIVE Unvested RSU Holder and will enter into lock-up arrangements with the Joint Financial Advisers in respect of such ESOP Shares to be issued by the
Resulting Issuer following Completion of the Proposed Business Combination. Please see Section 23.7 titled “Enlarged Group Corporate and Shareholding Structure – Moratorium” ofthis Circular for further details of the lock-up arrangements to be entered into by the 17LIVE Unvested RSU Holders in respect of the ESOP Shares and Section 13 titled “Proposed
Allotment and Issuance of the ESOP Shares” and Section 12 titled “Proposed Adoption of the Company Employee Share Option Plan” of this Circular for further details on the ESOP

(3)

(3A)

272

This includes the Substantial Shareholders of the Company and the Resulting Issuer as well as other shareholders of the Resulting Issuer that will enter into lock-up arrangements with
the Joint Financial Advisers. Please see Section 23.7 titled “Enlarged Group Corporate and Shareholding Structure – Moratorium” of this Circular for further details.

(2)(1C) Based on the allotment and issuance of 2,000,000 Base PIPE Shares to PIPE Investors. Please see Section 5.4 titled “Proposed Business Combination – PIPE Financing” of this Circularfor further details.

Based on the allotment and issuance of 0.1 Special Bonus NRS Shares to Non-Redeeming Shareholders. Please see Section 5.3 titled “Proposed Business Combination – Special Bonus
Scheme” of this Circular for further details.

––

Please refer to the row under the heading “Proposed Directors of the Resulting Issuer” above for details.

No. of Shares

Indirect interest

(1B)

–

–

%

Direct interest

Based on the allotment and issuance of 160,162,651 Consideration Shares. Please see Section 6 titled “Proposed Allotment and Issuance of the Consideration Shares” of this Circularfor further details.

––

No. of Shares

Indirect interest

After the Proposed Business Combination,
the Proposed Allotment and Issuance of theConsideration Shares(1A), the Proposed Allotment andIssuance of the Base PIPE Shares(1C) and the Proposed
Allotment and Issuance of Special Bonus Shares(1B)(1A)

Notes:

Mr. Kenta Masuda(3)(3A)

Mr. Ng Jing Shen

(3)(3A)

Mr. Lien Chien-Lin(3)(3A)

Key Executives(3)(3B)

Name

Direct interest

As at the Latest Practicable Date

After the Proposed Business Combination,
the Proposed Allotment and Issuance of theConsideration Shares(1A) and the Proposed Allotment
and Issuance of Special Bonus Shares(1B)

LETTER TO SHAREHOLDERS

(8)Vertex SPV is a wholly-owned subsidiary of VMFIVMFI is a wholly-owned subsidiary of the Sponsor

The Sponsor is a wholly-owned subsidiary of Ellensburg

Ellensburg is a wholly-owned subsidiary of Fullerton

•

•

•

•

Fullerton’s deemed interest arises from the interest of Vertex SPV as follows:

The Sponsor is a wholly-owned subsidiary of Ellensburg•

273

Ellensburg Holding Pte. Ltd. (“Ellensburg”)’s deemed interest arises from the interest of Vertex SPV as follows:(7)

VMFI is a wholly-owned subsidiary of the Sponsor

The Sponsor has invested in the Target Company through the Vertex Funds. Through a series of investments made by the Vertex Funds in the Target Company in 2017, 2018 and 2020,
the aggregate value of the Vertex Funds’ investment amounts to approximately 14.8% of the pre-money equity value of the Target Company of S$800.8 million (equivalent toapproximately US$590.6 million). Accordingly, the Sponsor is deemed to be interested in the shares held by the Vertex Funds.

(6)•

Vertex SPV is wholly-owned by Vertex Master Fund I Pte. Ltd. (“VMFI”), which is in turn wholly-owned by the Sponsor. Accordingly, VMFI and the Sponsor are deemed to be interested
in the shares held by Vertex SPV.

(5)

Vertex SPV is a wholly-owned subsidiary of VMFIDragon Alexander Limited is wholly-owned by Mr. Phua Jiexian Joseph. Accordingly, Mr. Phua Jiexian Joseph is deemed to be interested in the shares held by Dragon Alexander Limited
by virtue of Section 4 of the SFA.

(4)•

The persons included within this group (i.e. the Key Executives) may be allotted and issued EIS Shares depending on the Financial Targets for EIS achieved. Certain persons included
within this group may also be 17LIVE Unvested RSU Holders who will be allotted and issued ESOP Shares under the Company ESOP to be adopted in connection with the Proposed
Business Combination. The moratorium requirements applicable to this group will be extended to such EIS Shares and ESOP Shares held by the relevant persons. As the number of
EIS Shares and ESOP Shares that will be allotted and issued to the relevant persons (as well as the identities of the persons who will be allotted and issued EIS Shares) is not available
as at the date this table is prepared, their potential interest in such EIS Shares and ESOP Shares have not been taken into consideration in the table above.

(3B)

Shares to be allotted and issued under the Company ESOP. As the number of ESOP Shares that will be allotted and issued to this Shareholder is not available as at the date this tableis prepared, this Shareholder’s interest in such ESOP Shares has not been taken into consideration in the table above.

LETTER TO SHAREHOLDERS

Seviora is a wholly-owned subsidiary of Pilatus•

Innoven is a wholly-owned subsidiary of Innoven Capital Pte. Ltd.

Seviora holds 50.0% of shares in Innoven Capital Pte. Ltd.

Seviora is a wholly-owned subsidiary of Pilatus

FFMC is a wholly-owned subsidiary of FFMCH

•

•

•

a.

274

(14A) For the purposes of Section 4 of the SFA, Pilatus’ deemed interest arises from the aggregate of the interests of Innoven and FFMC as follows:

Seviora holds 51.0% of shares in FFMCH

For the purposes of Section 4 of the SFA, Pilatus Investments Pte. Ltd.’s (“Pilatus”) deemed interest arises from the interest of FFMC as follows:

(14)

•

FFMC is a wholly-owned subsidiary of FFMCH. FFMC is deemed to be interested in the FFMC Shares held directly by Income Insurance (see footnote 11). Seviora Holdings Pte. Ltd.
(“Seviora”) holds 51.0% of the shares in FFMCH. Accordingly, for the purposes of Section 4 of the SFA, Seviora is deemed to be interested in the shares in which Income Insurance
has an interest.

(13)

FFMC is deemed to be interested in the FFMC Shares held directly by Income Insurance (see footnote 11)

FFMC is a wholly-owned subsidiary of FFMC Holdings Pte. Ltd. (“FFMCH”). FFMC is deemed to be interested in the FFMC Shares held directly by Income Insurance (see footnote 11).
Accordingly, for the purposes of Section 4 of the SFA, FFMCH is deemed to be interested in the shares in which Income Insurance has an interest.

(12)

•

FFMC entered into a cornerstone subscription agreement with the Company for the FFMC Shares. Income Insurance is the client of FFMC and the registered holder of the FFMC Shares
and accordingly, Income Insurance has direct interest in the FFMC Shares. FFMC, as fund manager, has authority to dispose of, or to exercise control over the disposal of, the FFMC
Shares. Accordingly, for the purposes of Section 4(1) of the SFA, FFMC is deemed to be interested in the FFMC Shares held directly by Income Insurance.

(11)

FFMC is a wholly-owned subsidiary of FFMCH

FFMC entered into a cornerstone subscription agreement with the Company for 2,600,000 Shares (the “FFMC Shares”). Income Insurance Limited (formerly known as NTUC Income
Insurance Co-operative Limited) (“Income Insurance”) is the client of FFMC and the registered holder of the FFMC Shares and accordingly, Income Insurance has direct interest in the
FFMC Shares.

(10)

•

Venezio is a wholly-owned subsidiary of Napier Investments Pte. Ltd. (“Napier”). Accordingly, Napier is deemed to be interested in the shares held by Venezio by virtue of Section 4of the SFA.

(9)LETTER TO SHAREHOLDERS

Seviora is a wholly-owned subsidiary of Pilatusd.

Venezio is a wholly-owned subsidiary of Napier

Napier is a wholly-owned subsidiary of Tembusu

FFMC is a wholly-owned subsidiary of FFMCH

FFMC is deemed to be interested in the FFMC Shares held directly by Income Insurance (see footnote 11)

Seviora holds 51.0% of shares in FFMCH

Seviora is a wholly-owned subsidiary of Pilatus

Pilatus is a wholly-owned subsidiary of Tembusu

•

•

a.

b.

c.

d.

e.

For the purposes of Section 4 of the SFA, Tembusu’s deemed interest arises from the aggregate of the interests of Venezio and FFMC as follows:

Seviora holds 51.0% of shares in FFMCH

c.

Napier is a wholly-owned subsidiary of Tembusu

FFMC is a wholly-owned subsidiary of FFMCH

FFMC is deemed to be interested in the FFMC Shares held directly by Income Insurance (see footnote 11)

Seviora holds 51.0% of shares in FFMCH

Seviora is a wholly-owned subsidiary of Pilatus

Pilatus is a wholly-owned subsidiary of Tembusu

•

a.

b.

c.

d.

e.

275

Venezio is a wholly-owned subsidiary of Napier•(15A) For the purposes of Section 4 of the SFA, Tembusu’s deemed interest arises from the aggregate of the interests of Venezio, FFMC and Innoven as follows:(15)

FFMC is deemed to be interested in the FFMC Shares held directly by Income Insurance (see footnote 11)b.

LETTER TO SHAREHOLDERS

(16)Seviora holds 50.0% of shares in Innoven Capital Pte. Ltd.

Seviora is a wholly-owned subsidiary of Pilatus

Pilatus is a wholly-owned subsidiary of Tembusu

•

•

•

Napier is a wholly-owned subsidiary of Tembusu

Tembusu is a wholly-owned subsidiary of Temasek

FFMC is a wholly-owned subsidiary of FFMCH

FFMC is deemed to be interested in the FFMC Shares held directly by Income Insurance (see footnote 11)

Seviora holds 51.0% of shares in FFMCH

Seviora is a wholly-owned subsidiary of Pilatus

Pilatus is a wholly-owned subsidiary of Tembusu

Tembusu is a wholly-owned subsidiary of Temasek

Vertex SPV is a wholly-owned subsidiary of VMFIVMFI is a wholly-owned subsidiary of the Sponsor

The Sponsor is a wholly-owned subsidiary of Ellensburg

Ellensburg is a wholly-owned subsidiary of Fullerton

Fullerton is a wholly-owned subsidiary of Temasek

•

•

a.

b.

c.

d.

e.

f.

o

o

o

o

o

276

Venezio is a wholly-owned subsidiary of Napier•

For the purposes of Section 4 of the SFA, Temasek’s deemed interest arises from the aggregate of the interests of Venezio, FFMC and Vertex SPV as follows:–

Innoven is a wholly-owned subsidiary of Innoven Capital Pte. Ltd.

•LETTER TO SHAREHOLDERS

Napier is a wholly-owned subsidiary of Tembusu

Tembusu is a wholly-owned subsidiary of Temasek

FFMC is a wholly-owned subsidiary of FFMCH

FFMC is deemed to be interested in the FFMC Shares held directly by Income Insurance (see footnote 11)

Seviora holds 51.0% of shares in FFMCH

Seviora is a wholly-owned subsidiary of Pilatus

Pilatus is a wholly-owned subsidiary of Tembusu

Tembusu is a wholly-owned subsidiary of Temasek

Vertex SPV is a wholly-owned subsidiary of VMFIVMFI is a wholly-owned subsidiary of the Sponsor

The Sponsor is a wholly-owned subsidiary of Ellensburg

Ellensburg is a wholly-owned subsidiary of Fullerton

Fullerton is a wholly-owned subsidiary of Temasek

Innoven is a wholly-owned subsidiary of Innoven Capital Pte. Ltd.

Seviora holds 50.0% of shares in Innoven Capital Pte. Ltd.

•

•

a.

b.

c.

d.

e.

f.

o

o

o

o

o

i.

ii.

277

Venezio is a wholly-owned subsidiary of Napier•(16A) For the purposes of Section 4 of the SFA, Temasek’s deemed interest arises from the aggregate of the interests of Venezio, FFMC, Vertex SPV, Innoven, Pavilion and the Vertex Funds
as follows:

Each of FFMC, Seviora, Vertex SPV and the Sponsor is an independently managed Temasek portfolio company. Temasek is not involved in the business or operational decisions of these
entities, including their decisions in relation to the Target Group and the Company.

LETTER TO SHAREHOLDERS

Pilatus is a wholly-owned subsidiary of Tembusu

Tembusu is a wholly-owned subsidiary of Temasek

Pavilion is wholly-owned by the Pavilion group.

The ultimate parent company in the Pavilion group is Pavilion Capital Holdings Pte. Ltd. (“PCH”).

PCH is indirectly wholly-owned by Temasek.

The Sponsor has invested in the Target Company through the Vertex Funds. The Sponsor is indirectly wholly-owned by Temasek. Accordingly, for the purposes of Section 4 of
the SFA, Temasek is deemed to be interested in the shares held by the Vertex Funds.

iv.

v.

•

•

•

o

278

FFMC is a wholly-owned subsidiary of FFMCH. FFMC is deemed to be interested in the FFMC Shares held directly by Income Insurance (see footnote 11). Seviora holds 51.0%of the shares in FFMCH. Accordingly, for the purposes of Section 4 of the SFA, Seviora is deemed to be interested in the shares in which Income Insurance has an interest.

oSeviora’s deemed interest arises from the aggregate of the interests of Innoven and FFMC as follows:(21)

Seviora holds 50.0% of shares in Innoven Capital Pte. Ltd.

National Trades Union Congress (“National Trades”) owns (i) 32.6% of NTUC Enterprise, which in turn owns 71.6%; and (ii) 0.01%, of Income Insurance. Accordingly, for the purposesof Section 4(1) of the SFA, National Trades is deemed to be interested in the shares held directly by Income Insurance.

(20)

•

NTUC Foundation Limited (“NTUC Foundation”) owns 27.0% of NTUC Enterprise, which in turn owns 71.6% of Income Insurance. Accordingly, for the purposes of Section 4(1) of the
SFA, NTUC Foundation is deemed to be interested in the shares held directly by Income Insurance.

(19)

Innoven is a wholly-owned subsidiary of Innoven Capital Pte. Ltd.

NTUC Enterprise Co-operative Limited (“NTUC Enterprise”) owns 71.6% of Income Insurance. Accordingly, for the purposes of Section 4(1) of the SFA, NTUC Enterprise is deemed
to be interested in the shares held directly by Income Insurance.

(18)

•

NTUC Income Holdings Pte Ltd (“NTUC Income Holdings”) owns 49.0% of FFMCH. FFMC is a wholly-owned subsidiary of FFMCH. Accordingly, for the purposes of Section 4 of the
SFA, NTUC Income Holdings is deemed to be interested in the shares in which FFMC has an interest.

(17)

Each of FFMC, Seviora, Vertex SPV, the Vertex Funds, the Sponsor, Innoven and Pavilion is an independently managed Temasek portfolio company. Temasek is not involved in thebusiness or operational decisions of these entities, including their decisions in relation to the Target Group and the Company.

Seviora is a wholly-owned subsidiary of Pilatusiii.

LETTER TO SHAREHOLDERS

M17 Growth SPV B LLC is wholly-owned by M17 Growth SPV LLC. Accordingly, M17 Growth SPV LLC is deemed to be interested in the 1,571,493 shares held by M17 Growth SPV
B LLC by virtue of Section 4 of the SFA.

M17 Growth SPV B LLC is wholly-owned by M17 Growth SPV LLC, which is in turn wholly-owned by Aika Tong. Northpark Advisory Ltd. and Talent Dragon Co., Ltd. are wholly-owned
by Aika Tong, and Aika Tong owns 28.0% of Chia Nine Investments Co., Ltd. Accordingly, Aika Tong is deemed to be interested in the shares held by M17 Growth SPV LLC, M17 Growth
SPV B LLC, Northpark Advisory Ltd., Talent Dragon Co. Ltd. and Chia Nine Investments Co., Ltd. by virtue of Section 4 of the SFA.

Akio Tanaka owns 1.0% of Infinity e.Ventures Asia III, L.P.. Accordingly, Akio Tanaka is deemed to be interested in the shares held by Infinity e.Ventures Asia III, L.P. by virtue of Section 4of the SFA.

(24)

(25)

(26)

41,606,000

Total

279

29,606,000

6,000,000

Venezio

Shareholders other than the Sponsor and Venezio

6,000,000

The Sponsor

Number of Shares

As at the Latest Practicable Date, the current shareholding of the Company is as follows:

Dilution Effect Resulting from the Proposed Transactions

100.0%

71.2%

14.4%

14.4%

Percentage of Ownership

UBS Group AG is the parent entity of UBS AG. Each of UBS Group AG and UBS AG’s deemed interest arises by virtue of the shares which their respective subsidiaries or affiliates havean interest in through Section 7(4) or 7(4A) of the Companies Act by reason of their respective ability to exercise voting discretion and to acquire and/or dispose of shares.

(23)

23.6 Dilution Effect Resulting from the Proposed Transactions and the Exercise of the Warrants

Pavilion’s direct interest is based on the assumption that it is nominated by the Vendor to be allotted and issued Consideration Shares. Pavilion is wholly-owned by the Pavilion group.
The ultimate parent company in the Pavilion group is PCH. PCH is indirectly wholly-owned by Temasek. Pavilion is an independently-managed Temasek portfolio company. Temasek
is not involved in the business or operational decisions of Pavilion, including its decisions in relation to the Target Group and the Company.

(22)

LETTER TO SHAREHOLDERS

allotment and issuance of the Base PIPE Shares (the number of Base PIPE Shares to be allotted and issued is calculated based on theassumption that the total proceeds raised from the PIPE Financing is S$10.0 million (equivalent to approximately US$7.4 million), with each
Base PIPE Share issued at the Issue Price); andallotment and issuance of the Special Bonus Shares (the number of Special Bonus Shares to be allotted and issued is calculated based on(i) the number of Shares held by Non-Redeeming Shareholders as at the Redemption Record Date and (ii) the number of Base PIPE Shares
subscribed for by the PIPE Investors, with each Special Bonus Share issued at the Issue Price).

(b)

(c)

280

For the avoidance of doubt, the Enlarged Share Capital does not include the Promote Shares to be allotted and issued to Vertex SPV as such
Promote Shares will only be allotted and issued to Vertex SPV after Completion based on the vesting schedule set out in Section 29.2 titled“Material Contracts – The Company – Promote Shares Deed of Undertaking” of this Circular.

The enlargement of the share capital of the Company will be partially offset by Redemption by Shareholders.

allotment and issuance of the Consideration Shares (the number of Consideration Shares to be allotted and issued is calculated based on
the pre-money equity value of the Target Company of S$800.8 million (equivalent to approximately US$590.6 million), with each Consideration
Share issued at the Issue Price);(a)

Upon Completion of the Proposed Business Combination, the share capital of the Company will be enlarged by the allotment and issuance of new
Shares as follows:

Shareholding upon Completion of the Proposed Business Combination

LETTER TO SHAREHOLDERS

1041,606,000

Total

100.0%

100.0%
14.4%
14.4%
71.2%
–
–

Ownership %

–

–
–
–
–
–
–
160,162,651––––
160,162,651–
2,000,000

–
–
–
–
–
2,000,000(+)(-)
Shareholders’ Consideration (+) Base PIPE
Shares (A)Shares (B)Redemption

3,760,600

3,560,600–
600,000
2,960,600–
200,000(+) Special
Bonus
Shares (C)207,529,251

45,166,600
6,000,000
6,600,000
32,566,600
160,162,651
2,200,000

Enlarged
Share Capital

281

Calculated based on S$208.0 million of cash from the Escrow Account and the assumption that total proceeds of S$10.0 million are raised from the PIPE Financing

41,606,000
6,000,000
6,000,000
29,606,000––

Company’s
Shareholders
SponsorVenezio
Other Shareholders
Vendor Shareholders
PIPE Investors

Ordinary
Sharesoutstanding

Scenario 1: Assuming that there is No Redemption10

The tables below set out the dilution effect of the above transactions on the various groups of Shareholders.

LETTER TO SHAREHOLDERS

100.0%

21.8%
2.9%
3.2%
15.7%
77.2%
1.1%

Ownership %41,606,000

Total(29,606,000)(29,606,000)––(29,606,000)––
160,162,651––––
160,162,651–
2,000,000

–
–
–
–
–
2,000,000(+)(-)
Shareholders’ Consideration (+) Base PIPE
Shares (A)Shares (B)Redemption

800,000

600,000–
600,000––
200,000(+) Special
Bonus
Shares (C)174,962,651

12,600,000
6,000,000
6,600,000–
160,162,651
2,200,000

Enlarged
Share Capital282

For the purposes of the tables in scenarios 1 and 2, we have assumed that (a) the maximum number of ESOP Shares, Earnout Shares and EIS Shares are allotted and issued by theCompany, (b) the maximum number of Promote Shares (i.e. 10,401,500 Promote Shares) are allotted and issued by the Company to the Sponsor and (c) the maximum number of Warrants
are exercised into Shares. The actual shareholding of the Company post-Completion may vary depending on the actual number of ESOP Shares, Earnout Shares, EIS Shares and Promote
Shares allotted and issued by the Company and the actual number of Warrants that are exercised into Shares.

allotment and issuance of the Promote Shares; and

(d)

12

allotment and issuance of the EIS Shares (with each EIS Share issued at the Issue Price);(c)

Calculated based on the remaining proceeds of S$60.0 million raised from the Company’s initial public offering following Redemption and the assumption that total proceeds of S$10.0
million are raised from the PIPE Financing

allotment and issuance of the Earnout Shares (with each Earnout Share issued at the Issue Price);(b)

100.0%

7.2%
3.4%
3.8%
–
91.5%
1.3%

Ownership %11allotment and issuance of the ESOP Shares;(a)

Post Completion, the share capital of the Company will be further enlarged by the allotment and issuance of new Shares as follows12:

100.0%

100.0%
14.4%
14.4%
71.2%
–
–

Ownership %Fully diluted shareholding post-Completion

41,606,000
6,000,000
6,000,000
29,606,000––

Company’s
Shareholders
SponsorVenezio
Other Shareholders
Vendor Shareholders
PIPE Investors

Ordinary
Sharesoutstanding

Scenario 2: Assuming that there is Maximum Redemption11

LETTER TO SHAREHOLDERS

(e)the Additional Warrants, to be issued to the Non-Redeeming Shareholders and Vertex SPV upon Completion of the Proposed Business Combination;andthe 16 million Private Placement Warrants.

(ii)

(iii)

8,881,800
5,921,200

Existing Warrants

Additional Warrants

283

36,803,000

14,803,000

Other Shareholders

Total Warrants

1,800,000
1,200,000

Additional Warrants

3,000,000

16,000,000

Existing Warrants

Venezio

Private Placement Warrants

1,800,000
1,200,000

Additional Warrants

19,000,000

Existing Warrants

Sponsor

13,285,883

2,137,553

3,206,330

5,343,883

433,200

649,800

1,083,000

5,776,000

433,200

649,800

6,859,000

No Redemption
Warrants
Shares30,881,800–

8,881,800

8,881,800

1,200,000

1,800,000

3,000,000

16,000,000

1,200,000

1,800,000

19,000,000

11,148,330–

3,206,330

3,206,330

433,200

649,800

1,083,000

5,776,000

433,200

649,800

6,859,000

Maximum Redemption
Warrants
Shares(Market Redemption Trigger Price of S$9.00 – Warrant Exercise Price of $5.75)/Market Redemption Trigger Price of S$9.00

To illustrate the dilutive impact of the redemption of the Public Warrants and Private Placement Warrants, the number of Shares to be allotted and issued
is calculated based on the redemption ratio of 0.361 Converted Shares for each Warrant redeemed, calculated based on:

the Existing Warrants issued to Shareholders at the completion of the Offering and which will survive even in the event that the Warrantholder elects
to redeem their Shares prior to the EGM;

(i)allotment and issuance of Shares pursuant to the exercise of the following Warrants:

LETTER TO SHAREHOLDERS

13

77.2%
–

–
1.1%

160,162,651––
2,200,000
100.0%

15.7%

32,566,600

207,529,251

21.8%
2.9%
3.2%

45,166,600
6,000,000
6,600,000

Ownership%

2,114,891

2,114,891
–

–

–

–
–
–

(+) ESOP (D)24,408,000––

24,408,000
–

–

–
–
–

(+) Earnout
Shares (E)2,550,000–––
2,550,000

–

–
–
–

(+) EIS
Shares (F)4,090,900

–
–

–
–

–

4,090,900
4,090,900–(+) Promote
Shares (G)13,285,883

–
–

–
–

5,343,883

13,285,883
6,859,000
1,083,000(+) Sharesfrom cashlessconversion of
Public Warrants andPrivate Placement
Warrants (H)253,978,925

2,114,891
2,200,000

184,570,651
2,550,000

37,910,483

62,543,383
16,949,900
7,683,000

Fully
Enlarged
Share
Capital284

Calculated based on S$208.0 million of cash from the Escrow Account and the assumption that total proceeds of S$10.0 million are raised from the PIPE Financing

Total

Company’s
Shareholders
SponsorVenezio
Other
Shareholders
VendorShareholders
Key Executives
17LIVE Unvested
RSU Holders andCompany ESOP
Participants
PIPE Investors

Enlarged
Share
CapitalScenario 1: Assuming that there is No Redemption 13

The tables below set out the dilution effect of the above transactions on the various groups of Shareholders.

LETTER TO SHAREHOLDERS

100.0%

0.8%
0.9%

72.7%
1.0%

14.9%

24.6%
6.7%
3.0%

Ownership
%

14

91.5%
–

1.3%

160,162,651–

2,200,000
100.0%––

174,962,651

7.2%
3.4%
3.8%

12,600,000
6,000,000
6,600,000

Ownership%

24,408,000––

2,114,891–
2,114,891

24,408,000
–

–

–
–
–

(+) Earnout
Shares (E)

–

–

–
–
–

(+) ESOP (D)2,550,000–––
2,550,000

–

–
–
–

(+) EIS
Shares (F)7,051,500

–
–

–
–

–

7,051,500
7,051,500–(+) Promote
Shares (G)11,148,330

–
–

–
–

3,206,330

11,148,330
6,859,000
1,083,000(+) Sharesfrom cashlessconversion of
Public Warrants andPrivate Placement
Warrants (H)222,235,372

2,114,891
2,200,000

184,570,651
2,550,000

3,206,330

30,799,830
19,910,500
7,683,000

Fully
Enlarged
Share
Capital285

Calculated based on S$60.0 million of cash from the Escrow Account and the assumption that total proceeds of S$10.0 million are raised from the PIPE Financing

Total

Company’s
Shareholders
SponsorVenezio
Other
Shareholders
VendorShareholders
Key Executives
17LIVE Unvested
RSU Holders andCompany ESOP
Participants
PIPE Investors

Enlarged
Share
CapitalScenario 2: Assuming that there is Maximum Redemption14

LETTER TO SHAREHOLDERS

100.0%

1.0%
1.0%

83.1%
1.1%

1.4%

13.9%
9.0%
3.5%

Ownership%LETTER TO SHAREHOLDERS
Dilution Effect Resulting from the Exercise of the Warrants
Each Unit subscribed for by Shareholders at the Company’s initial public offering comprises
one Share and 0.3 of one Warrant per Share (the “Existing Warrants”), which was issued
at the completion of the Offering, with an additional right to 0.2 of one Warrant per Share(the “Additional Warrants”) which will be issued to holders of Shares which have not beentendered for Redemption prior to the EGM. Persons who do not hold any Shares will not be
entitled to the Additional Warrants.
Each whole Warrant entitles the Warrantholder to subscribe for one Share at the Warrant
Exercise Price during the Warrant Exercise Period. Converted Shares allotted and issued
upon the exercise of the Warrants shall be fully paid and shall rank pari passu in all respects
with the then existing Shares save for any dividends, rights, allotments and other
distributions the Distribution Record Date for which is before the relevant Exercise Date of
the Warrants. “Distribution Record Date” means, in relation to any dividends, rights,
allotments or other distributions, the date at the close of business on which Shareholders
must be registered in order to participate in such dividends, rights, allotments or other
distributions.
Given that (a) all Shareholders have been allotted and issued the Existing Warrants, (b) all
Shareholders (including Vertex SPV and Venezio) will be entitled to the Additional Warrants
as long as they do not tender their Shares for Redemption prior to the EGM, and (c) theConverted Shares allotted and issued upon the exercise of the Warrants will generally rankpari passu in all respects with the existing Shares, the impact of dilution to Shareholders
arising from the conversion of the Warrants will be minimal. Further, the Shareholders’entitlement to the Additional Warrants has been disclosed in the Prospectus andShareholders may minimise the impact of dilution from the conversion of the Warrants byelecting to not tender their Shares for Redemption prior to the EGM.
Features of the Warrants
Voting rights
Subject to the terms of the Warrant Agreement, Warrants which have not been exercised
shall confer the right to attend or vote at, or join in convening, or be counted in the quorum
for any meeting of Warrantholders. However, Warrants which have not been exercised but
have been lodged for exercise shall not, unless and until they are withdrawn fromlodgement, confer the right to attend or vote at, or join in convening, or be counted in thequorum for any meeting of Warrantholders.
TenureA Warrant may be exercised only during the period (“Warrant Exercise Period”)
commencing on the later of: (i) the date that is 30 days after the first date on which theCompany completes an initial business combination or (ii) the date that is 12 months fromthe close of the Offering and terminating at the earlier to occur of: (x) 5:00 p.m., Singapore
time on the date that is five years after the date on which the Company completes its initialbusiness combination, (y) the Company’s Liquidation, or (z) (other than with respect to thePrivate Placement Warrants to the extent then held by Vertex SPV or its Permitted
Transferees), 5:00 p.m., Singapore time on the Warrant Redemption Date as provided in
the Warrant Conditions (the “Warrant Expiration Date”); provided, however, that the286

LETTER TO SHAREHOLDERS
exercise of any Warrant shall be subject to the satisfaction of any applicable Warrant
Conditions. After the Warrant Expiration Date, any subscription rights which have not been
exercised will lapse and the Warrants will cease to be valid for any purpose whatsoever.
Warrant Exercise Price
The exercise price of the Warrants is S$5.75 for each whole Share, subject to theadjustments as described in the Warrant Conditions (“Warrant Exercise Price”).
Redemption Terms of the Warrants
Subject to the Warrant Conditions, the Company may, at its option, redeem all (and not part)of the outstanding Warrants, at any time during the Warrant Exercise Period, at the officeof the Warrant Agent, upon notice to the Warrantholders of the Warrants, as described in theparagraph below, provided that the Reference Value equals or exceeds S$9.00 per Share(subject to adjustment in compliance with the Warrant Conditions).
In the event that the Company elects to redeem the Warrants, the Company shall fix a date
for the redemption (the “Warrant Redemption Date”). Notice of redemption shall be mailed
by first class mail, postage prepaid, by the Company not less than 30 days prior to the
Warrant Redemption Date (the “30-day Redemption Period”) to the Warrantholders of the
Public Warrants to be redeemed at their last addresses as they shall appear on theregistration books.
The Warrants may be exercised by Warrantholders for cash at any time during the 30-day
Redemption Period and any Warrants outstanding as at the Warrant Redemption Date shallbe redeemed and settled on a “cashless basis”. The notice of redemption shall contain
instructions on how to calculate the number of Converted Shares to be received upon
redemption of the Warrants on a “cashless basis” (the “Redemption Shares”). The number
of Redemption Shares to be received upon redemption of the Warrants on a “cashlessbasis” shall be the product of Warrants held by such Warrantholder, multiplied by 0.361(rounded down to the nearest whole number of Redemption Shares). For the avoidance of
doubt, the multiple of 0.361 is (a) independent of and will not be affected by the Warrant
Redemption Date fixed by the Company or the fair market value of the Shares; and (b) fixed
regardless of any adjustments to the Warrant Exercise Price as there will be acorresponding and proportionate adjustment to the redemption trigger price in accordancewith the Warrant Conditions.
The redemption rights provided above shall not apply to the Private Placement Warrants if
at the time of the redemption such Private Placement Warrants continue to be held byVertex SPV or any of its Permitted Transferees. However, once such Private Placement
Warrants are transferred (other than to Permitted Transferees in accordance with theWarrant Conditions), the Company may redeem the Private Placement Warrants provided
that the criteria for redemption are met.
Private Placement Warrants
Vertex SPV had purchased 16.0 million Private Placement Warrants on the close of theOffering pursuant to the Private Placement Warrants Purchase Agreement, all of which
remain outstanding as at the Latest Practicable Date.

287

LETTER TO SHAREHOLDERS
Each Private Placement Warrant entitles Vertex SPV to subscribe for one new Share basedon the exercise price of S$5.75 per Share, subject to adjustment. The Private Placement
Warrants are identical to the Warrants included in the Units sold in the Offering, subject tocertain limited exceptions as described in the Section 23.6 titled “Enlarged Group Corporate
and Shareholding Structure – Dilution Effect Resulting from the Proposed Transactions andthe Exercise of the Warrants – Dilution Effect Resulting from the Exercise of the Warrants– Differences between the Private Placement Warrants and the Public Warrants” of thisCircular.
The Private Placement Warrants will become exercisable during the Warrant Exercise
Period. Subject to the terms of the Warrant Agreement, the Private Placement Warrants will
expire at 5:00 p.m. on the date five years after the completion of the Company’s initialbusiness combination or earlier upon Liquidation. Upon expiry, the Private Placement
Warrants shall cease to be valid for any purpose.
Differences between the Private Placement Warrants and the Public Warrants
There is only one series of Warrants listed and traded. The Private Placement Warrants are
acquired by Vertex SPV with cash in order to provide the Company with working capital,
whereas the Public Warrants are offered “for free” as part of the Unit. Under the provisionsof the Warrant Agreement, the Private Placement Warrants and the Public Warrants arefrom the same series of Warrants except that in the hands of Vertex SPV (and its Permitted
Transferees), the Private Placement Warrants:•

are subject to certain transfer restrictions (as detailed in Condition 2.4 of the section
titled “Appendix E – Terms and Conditions of the Warrants” of the Prospectus);•

are not subject to the Company’s redemption right (as detailed in Condition 6.1 of thesection titled “Appendix E – Terms and Conditions of the Warrants” of the Prospectus);
and•may be exercised on a cash or on a “cashless basis” (as detailed in Condition 3.3I ofthe section titled “Appendix E – Terms and Conditions of the Warrants” of theProspectus).

The abovementioned contractual features are akin to the moratorium requirements on the
Warrants. Pursuant to the terms of the Warrant Agreement, where the Private Placement
Warrants are transferred to persons other than Permitted Transferees and shall upon suchtransfer cease to be Private Placement Warrants and shall become Public Warrants, theWarrant Agent shall not cancel such Private Placement Warrant surrendered for transfer
bearing a restrictive legend and issue new Warrants in exchange thereof, until the Warrant
Agent has received an opinion from our legal counsel stating that such transfer may bemade and indicating whether the new Warrants must also bear a restrictive legend.
23.7 Moratorium
Rule 1015(3)(c) of the Mainboard Rules provides that the moratorium requirements
specified in Rules 227, 228 and 229 are applicable to the following persons:(a)persons who are existing Controlling Shareholders or who will become Controlling
Shareholders of the issuer as a result of the asset acquisition; and(b)

Associates of any person in (a).

288

LETTER TO SHAREHOLDERS
Rule 210(11)(h) of the Mainboard Rules further provides that the moratorium requirements
specified in Rules 227, 228 and 229 are applicable, and following the Completion of the
Proposed Business Combination, all equity securities of (a) the founding shareholders andthe Management Team of the Company, and their Associates, and (b) the Controlling
Shareholders of the Enlarged Group and their Associates, and executive directors of theEnlarged Group with an interest in 5% or more of the issued share capital of the Enlarged
Group, will be subject to the moratorium requirements in Rules 227, 228 and 229 from theCompletion Date of the Proposed Business Combination.
In compliance with the regulatory requirements, the terms of the Management andPlacement Agreement and/or the SPA, and to demonstrate their commitment to theEnlarged Group, the following persons will provide/have provided undertakings in favour of
the Joint Financial Advisers as set out below:
The Company
The Company has agreed and covenanted with and undertaken to the Joint Financial
Advisers that, save to the extent contemplated by the Proposed Business Combination and
the PIPE Financing, the Company will not, at any time from the Completion Date until suchdate being six months after the Completion Date (both dates inclusive) without the priorwritten consent of the Joint Financial Advisers and Joint Placement Agents, directly or
indirectly:(a)allot, offer, issue, sell, accept subscription for, offer to allot, issue or sell, contract oragree to allot, issue or sell, mortgage, charge, pledge, hypothecate, hedge, lend, grantor sell any option, warrant, contract or right to subscribe for or purchase, grant orpurchase any option, warrant, contract or right to allot, issue or sell, or otherwisetransfer or dispose of or create an encumbrance over (whether by way of mortgage,assignment of receivables, debenture, lien (other than liens arising by operation of law
in the ordinary course of business), charge, pledge, title retention, right to acquire,security interest, options, rights of first refusal, pre-emption rights or any otherencumbrance), or contract or agree to transfer or dispose of or create an encumbrance
over (whether by way of mortgage, assignment of receivables, debenture, lien (otherthan liens arising by operation of law in the ordinary course of business), charge,
pledge, title retention, right to acquire, security interest, options, rights of first refusal,
pre-emption rights or any other encumbrance), either directly or indirectly,
conditionally or unconditionally, any Shares or any other securities of the Company or
any subsidiary of the Company, as applicable, or any interest in any of the foregoing(including, without limitation, any equity-linked securities, perpetual securities and any
securities convertible into or exchangeable or exercisable for or that represent theright to receive, or any Warrants or other rights to subscribe for or purchase any
Shares or any other securities of the Company or any subsidiary of the Company,
whether such transaction is to be settled by delivery of Shares or other securities of
the Company or any subsidiary of the Company, or in cash or otherwise, or deposit
Shares with a depository in connection with the issue of depository receipts);

289

LETTER TO SHAREHOLDERS(b)enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of any Shares or any securities of the Company or any
subsidiary of the Company, or any interest in any of the foregoing (including, without
limitation, any securities convertible into or exchangeable or exercisable for or that
represent the right to receive, or any warrants or other rights to subscribe for orpurchase, any Shares or any other securities of the Company or any subsidiary of theCompany, whether such transaction is to be settled by delivery of Shares or othersecurities of the Company or subsidiary of the Company, or in cash or otherwise);(c)deposit any Shares or any other securities of the Company or any subsidiary of theCompany (including any securities convertible into or exercisable or exchangeable for,or which carry rights to subscribe for or purchase any Shares or any other securitiesof the Company or any subsidiary of the Company) in any depository receipt facilities(other than in a CDP designated moratorium account for the purposes of complying
with these restrictions);(d)enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; or(e)announce or publicly disclose any intention to do any of the above,

provided, however, that the foregoing restrictions shall not apply in respect of (i) the PIPE
Shares, Consideration Shares, Earnout Shares, EIS Shares, ESOP Shares and Special
Bonus Shares, and (ii) any actions that the Company or a subsidiary is required toundertake pursuant to their respective obligations under the SPA.
The Sponsor
The Sponsor will agree with the Joint Financial Advisers that, from the Completion Date up
to and including the date falling 12 months after the Completion Date (both dates inclusive),
it will not, without the prior written consent of the Joint Financial Advisers, directly or
indirectly:(a)reduce its effective interests in the 6,000,000 Shares of the issued and paid-up sharecapital of the Company held by Vertex SPV (the “Sponsor Shares”), the Promote
Shares (the “Lock-up Promote Shares”) or the 17,800,000 Warrants, comprising
1,800,000 Public Warrants and 16,000,000 Private Placement Warrants, and an
additional right to 0.2 of one Warrant per Sponsor Share which Vertex SPV holds(which have not been tendered for Redemption) and which will only be issued at or
around the Completion of the Proposed Business Combination (the “Additional
Sponsor Warrants”, and together with the Public Warrants and Private Placement
Warrants, the “Sponsor Warrants”) (collectively, the “Sponsor Securities”);(b)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchaseany option or contract to sell, grant any option, right or warrant to purchase, lend,
hypothecate, grant security over, encumber or otherwise transfer or dispose of its
interests in any shares in Vertex SPV (the “Vertex SPV Shares”) (or any securities
convertible into or exercisable or exchangeable for or which carry rights to subscribe
for or purchase any of the Vertex SPV Shares) or enter into a transaction that would
have the same effect, whether any such transaction described above is to be settled
by delivery of the Vertex SPV Shares or such other securities, in cash or otherwise;290

LETTER TO SHAREHOLDERS(c)enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of the Vertex SPV Shares (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the Vertex SPV Shares), whether any such transaction describedabove is to be settled by delivery of the Vertex SPV Shares or such other securities,
in cash or otherwise;(d)deposit any of the Vertex SPV Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of Vertex SPV
Shares in any depository receipt facilities, whether any such transaction describedabove is to be settled by delivery of Vertex SPV Shares or such other securities, incash or otherwise;(e)enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; or(f)announce or publicly disclose any intention to do any of the above.

For the avoidance of doubt, any Sponsor Shares issued pursuant to the exercise of Sponsor
Warrants would still be considered as Sponsor Securities.
Vertex SPV
Vertex SPV will agree with the Joint Financial Advisers that:(i)from the Completion Date up to and including the date falling six months after theCompletion Date (both dates inclusive), it will not, without the prior written consent of
the Joint Financial Advisers, directly or indirectly:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase,purchase any option or contract to sell, grant any option, right or warrant topurchase, lend, hypothecate, grant security over, encumber or otherwise transfer
or dispose of its holdings in any Sponsor Securities (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the Sponsor Securities) or enter into a transaction that would
have the same effect, whether any such transaction described above is to besettled by delivery of the Sponsor Securities or such other securities, in cash orotherwise;(b)enter into any swap, hedge or other transaction or arrangement (including aderivative transaction) that transfers to another, in whole or in part, any of theeconomic consequences of ownership of the Sponsor Securities (or any
securities convertible into or exercisable or exchangeable for or which carryrights to subscribe for or purchase any of the Sponsor Securities), whether any
such transaction described above is to be settled by delivery of the Sponsor
Securities or such other securities, in cash or otherwise;

291

LETTER TO SHAREHOLDERS(c)deposit any of the Sponsor Securities or any securities convertible into or
exchangeable for which carry rights to subscribe for or purchase any of theSponsor Securities in any depository receipt facilities (other than in a CDP
designated moratorium account for the purposes of complying with its obligations
under its undertaking), whether any such transaction described above is to besettled by delivery of the Sponsor Securities or such other securities, in cash orotherwise;(d)redeem any holdings of its Shares in connection with the Completion of the
Proposed Business Combination;(e)enter into any transaction which is designed or which may reasonably be
expected to result in any of the above; or(f)announce or publicly disclose any intention to do any of the above.

For the avoidance of doubt, any Sponsor Shares issued pursuant to the exercise ofSponsor Warrants would still be considered as Sponsor Securities.
(ii)

from the Completion Date up until the date falling 12 months after the Completion Date(both dates inclusive), it will not, without the prior written consent of the Joint Financial
Advisers, directly or indirectly:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase,purchase any option or contract to sell, grant any option, right or warrant topurchase, lend, hypothecate, grant security over, encumber or otherwise transfer
or dispose of its holdings in any Lock-up Promote Shares (or any securities
convertible into or exercisable or exchangeable for or which carry rights to
subscribe for or purchase any of the Lock-up Promote Shares) or enter into atransaction that would have the same effect, whether any such transaction
described above is to be settled by delivery of the Lock-up Promote Shares, orsuch other securities, in cash or otherwise;(b)enter into any swap, hedge or other transaction or arrangement (including aderivative transaction) that transfers to another, in whole or in part, any of theeconomic consequences of ownership of the Lock-up Promote Shares (or any
securities convertible into or exercisable or exchangeable for or which carryrights to subscribe for or purchase any of the Lock-up Promote Shares), whether
any such transaction described above is to be settled by delivery of the Lock-up
Promote Shares, or such other securities, in cash or otherwise;(c)deposit any of the Lock-up Promote Shares, or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the
Lock-up Promote Shares in any depository receipt facilities (other than in a CDP
designated moratorium account for the purposes of complying with its obligations
under its undertaking), whether any such transaction described above is to besettled by delivery of the Lock-up Promote Shares, or such other securities, incash or otherwise;292

LETTER TO SHAREHOLDERS(d)enter into any transaction which is designed or which may reasonably be
expected to result in any of the above; or(e)announce or publicly disclose any intention to do any of the above.

Subject to the Mainboard Rules, the restrictions in paragraph (i) do not apply to aredemption of the Sponsor Securities in connection with the liquidation of the Company inthe event of a failure to complete an initial business combination.
Venezio
Venezio will agree with the Joint Financial Advisers that, from the Completion Date up to
and including the date falling six months after the Completion Date (both dates inclusive),
it will not, without the prior written consent of the Joint Financial Advisers, directly or
indirectly:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchaseany option or contract to sell, grant any option, right or warrant to purchase, lend,
hypothecate, grant security over, encumber or otherwise transfer or dispose of the
6,000,000 Shares of the issued and paid-up share capital of the Company held by
Venezio and the Special Bonus Shares (collectively, the “Venezio Shares”), or the
1,800,000 Warrants, and an additional right to 0.2 of one Warrant per Venezio Sharewhich Venezio holds (which have not been tendered for Redemption) and which will
only be issued at or around the Completion of the Proposed Business Combination(the “Additional Venezio Warrants”, and together with the 1,800,000 Warrants, the“Venezio Warrants”) as of the Completion Date (collectively, the “Venezio
Securities”) (or any securities convertible into or exercisable or exchangeable for or
which carry rights to subscribe for or purchase any of the Venezio Securities) or enter
into a transaction that would have the same effect, whether any such transaction
described above is to be settled by delivery of the Venezio Securities or such othersecurities, in cash or otherwise;(b)enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of the Venezio Securities (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the Venezio Securities), whether any such transaction describedabove is to be settled by delivery of the Venezio Securities or such other securities, incash or otherwise;(c)deposit any of the Venezio Securities or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the Venezio
Securities in any depository receipt facilities (other than in a CDP designatedmoratorium account for the purposes of complying with its obligations under its
undertaking), whether any such transaction described above is to be settled bydelivery of the Venezio Securities or such other securities, in cash or otherwise;(d)enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; or(e)announce or publicly disclose any intention to do any of the above.

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LETTER TO SHAREHOLDERS
For the avoidance of doubt, any Venezio Shares issued pursuant to the exercise of Venezio
Warrants would still be considered as Venezio Securities for the purposes of the restrictions
above.
The restrictions above do not apply to prohibit Venezio from:(a)a redemption of the Venezio Securities in connection with the liquidation of theCompany in the event of a failure to complete an initial business combination; and(b)where the initial business combination results in the Company being reconstituted, or
merged or amalgamated into or with another entity (the “resulting issuer”), anytransfers, transactions or arrangements for the Venezio Securities to be exchanged foror otherwise converted into interest in the resulting issuer, provided that Venezio has
executed and delivered to the Joint Financial Advisers an undertaking that to thereasonable satisfaction of the Joint Financial Advisers is equivalent to the effect of therestriction described above, to remain in effect for the remainder of the period from theCompletion Date up to and including the date falling six months after the Completion
Date (both dates inclusive).

Tembusu
Tembusu will agree with the Joint Financial Advisers that, from the Completion Date up to
and including the date falling six months after the Completion Date (both dates inclusive),
it will not, without the prior written consent of the Joint Financial Advisers, directly or
indirectly:(a)reduce its effective interests in the Venezio Securities held by Venezio as of theCompletion Date;(b)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchaseany option or contract to sell, grant any option, right or warrant to purchase, lend,
hypothecate, grant security over, encumber or otherwise transfer or dispose of any
shares in Venezio (the “VI Shares”) (or any securities convertible into or exercisable
or exchangeable for or which carry rights to subscribe for or purchase any of the VI
Shares) or enter into a transaction that would have the same effect, whether any suchtransaction described above is to be settled by delivery of the VI Shares or such othersecurities, in cash or otherwise;(c)enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of the VI Shares (or any securities convertible into or
exercisable or exchangeable for or which carry rights to subscribe for or purchase anyof the VI Shares), whether any such transaction described above is to be settled bydelivery of the VI Shares or such other securities, in cash or otherwise;(d)deposit any of the VI Shares or any securities convertible into or exchangeable for or
which carry rights to subscribe for or purchase any of the VI Shares in any depository
receipt facilities (other than in a CDP designated moratorium account for the purposesof complying with its obligations under its undertaking), whether any such transaction
described above is to be settled by delivery of the VI Shares or such other securities,
in cash or otherwise;294

LETTER TO SHAREHOLDERS(e)enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; or(f)announce or publicly disclose any intention to do any of the above.

For the avoidance of doubt, any Venezio Shares issued pursuant to the exercise of Venezio
Warrants would still be considered as Venezio Securities for the purposes of the restrictions
above.
The restrictions above do not apply to prohibit Tembusu from:(a)any transfer of its interests in VI Shares by Tembusu to any of Temasek’s direct andindirect wholly-owned subsidiaries whose boards of directors or equivalent governing
bodies comprise employees and nominees of: (1) Temasek; (2) Temasek Pte. Ltd.;
and/or (3) any direct and indirect wholly-owned subsidiaries of Temasek Pte. Ltd.,
provided that each such subsidiary has executed and delivered to the Joint Financial
Advisers an undertaking that to the reasonable satisfaction of the Joint Financial
Advisers is equivalent to the effect of the restriction described above, to remain in
effect for the remainder of the period from Completion Date up to and including thedate falling six months after the Completion Date (both dates inclusive);(b)a redemption of the Venezio Securities in connection with the liquidation of theCompany in the event of a failure to complete an initial business combination; and(c)where the initial business combination results in the Company being reconstituted, or
merged or amalgamated into or with the resulting issuer, any transfers, transactions or
arrangements for the Venezio Securities to be exchanged for or otherwise converted
into interest in the resulting issuer, provided that Venezio has executed and delivered
to the Joint Financial Advisers an undertaking that to the reasonable satisfaction of the
Joint Financial Advisers is equivalent to the effect of the restriction described above,
to remain in effect for the remainder of the period from the Completion Date up to andincluding the date falling six months after the Completion Date (both dates inclusive).

Phua Jiexian Joseph
Phua Jiexian Joseph will agree with the Joint Financial Advisers that:(i)from Completion Date up to and including the date falling 6 months after theCompletion Date (both dates inclusive), (the “Lock-up Period”) he will not, without theprior written consent of the Joint Financial Advisers, directly or indirectly:(a)reduce his effective interest in the Shares (including the Consideration Sharesand the Earnout Shares);(b)offer, pledge, sell, contract to sell, sell any option or contract to purchase,purchase any option or contract to sell, grant any option, right or warrant topurchase, lend, hypothecate, grant security over, encumber or otherwise transfer
or dispose of his interests in any shares in Dragon Alexander Limited (the “DAL
Shares”) (or any securities convertible into or exercisable or exchangeable for or
which carry rights to subscribe for or purchase any of the DAL Shares) or enter
into a transaction that would have the same effect, whether any such transaction
described above is to be settled by delivery of the DAL Shares or such othersecurities, in cash or otherwise;295

LETTER TO SHAREHOLDERS

(ii)

(c)

enter into any swap, hedge or other transaction or arrangement (including aderivative transaction) that transfers to another, in whole or in part, any of theeconomic consequences of ownership of the DAL Shares (or any securities
convertible into or exercisable or exchangeable for or which carry rights to
subscribe for or purchase any of the DAL Shares), whether any such transaction
described above is to be settled by delivery of the DAL Shares or such othersecurities, in cash or otherwise;(d)deposit any of the DAL Shares or any securities convertible into or exchangeable
for or which carry rights to subscribe for or purchase any of DAL Shares in any
depository receipt facilities, whether any such transaction described above is tobe settled by delivery of DAL Shares or such other securities, in cash orotherwise;(e)enter into any transaction which is designed or which may reasonably be
expected to result in any of the above; or(f)announce or publicly disclose any intention to do any of the above.

during the Lock-up Period, he will not, without the prior written consent of the Joint
Financial Advisers, directly or indirectly:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase,purchase any option or contract to sell, grant any option, right or warrant topurchase, lend, hypothecate, grant security over, encumber or otherwise transfer
or dispose of his holdings in any shares of the Company (including the Earnout
Shares and the EIS Shares (if applicable)) (collectively, the “PJJ Lock-up
Shares”) (or any securities convertible into or exercisable or exchangeable for or
which carry rights to subscribe for or purchase any of the PJJ Lock-up Shares)
or enter into a transaction that would have the same effect, whether any suchtransaction described above is to be settled by delivery of the PJJ Lock-up
Shares or such other securities, in cash or otherwise;(b)enter into any swap, hedge or other transaction or arrangement (including aderivative transaction) that transfers to another, in whole or in part, any of theeconomic consequences of ownership of the PJJ Lock-up Shares (or any
securities convertible into or exercisable or exchangeable for or which carryrights to subscribe for or purchase any of the PJJ Lock-up Shares), whether any
such transaction described above is to be settled by delivery of the PJJ Lock-up
Shares or such other securities, in cash or otherwise;(c)deposit any of the PJJ Lock-up Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the PJJ
Lock-up Shares in any depository receipt facilities, whether any such transaction
described above is to be settled by delivery of the PJJ Lock-up Shares or suchother securities, in cash or otherwise;(d)enter into any transaction which is designed or which may reasonably be
expected to result in any of the above; and(e)announce or publicly disclose any intention to do any of the above.

296

LETTER TO SHAREHOLDERS
Notwithstanding paragraphs (i) and (ii) above, Phua Jiexian Joseph shall be entitled toenter into any transaction or do any action contemplated pursuant to paragraphs (i) and (ii)above provided that:(i)where applicable, any such charge, security or encumbrance shall not be enforced
over any of the DAL Shares or PJJ Lock-up Shares, including any Shares he acquires
during the Lock-up Period, and the chargee agrees with the Joint Financial Advisersthat such charge, security or encumbrance over the relevant DAL Shares or PJJ
Lock-up Shares, including any new Shares he acquires during the Lock-up Period that
may be subject to such charge, security or encumbrance, cannot be enforced during
the Lock-up Period; and(ii)

any such transaction will not result in a transfer (whether in whole or in part) to a third
party, during the Lock-Up Period, of any legal or beneficial ownership interest of the
DAL Shares or PJJ Lock-up Shares, including any Shares he acquires during the
Lock-up Period,and evidence of the above is provided to the reasonable satisfaction of the Joint Financial
Advisers.
Ng Jing Shen
Ng Jing Shen will agree with the Joint Financial Advisers that, from the Completion Date up
to and including the date falling six months after the Completion Date (both dates inclusive),
he will not, without the prior written consent of the Joint Financial Advisers, directly or
indirectly:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchaseany option or contract to sell, grant any option, right or warrant to purchase, lend,
hypothecate, grant security over, encumber or otherwise transfer or dispose of his
holdings in any Shares (including the Consideration Shares, ESOP Shares, EIS
Shares and Earnout Shares (if applicable)) (collectively, the “NJS Lock-up Shares”)(or any securities convertible into or exercisable or exchangeable for or which carryrights to subscribe for or purchase any of the NJS Lock-up Shares) or enter into atransaction that would have the same effect, whether any such transaction describedabove is to be settled by delivery of the NJS Lock-up Shares or such other securities,
in cash or otherwise;(b)enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of the NJS Lock-up Shares (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the NJS Lock-up Shares), whether any such transaction describedabove is to be settled by delivery of the NJS Lock-up Shares or such other securities,
in cash or otherwise;297

LETTER TO SHAREHOLDERS(c)deposit any of the NJS Lock-up Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the NJS
Lock-up Shares in any depository receipt facilities, whether any such transaction
described above is to be settled by delivery of the NJS Lock-up Shares or such othersecurities, in cash or otherwise;(d)enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; and(e)announce or publicly disclose any intention to do any of the above.

Aika Tong(i)

Aika Tong will agree with the Joint Financial Advisers that, from Completion Date up
to and including the date falling six months after the Completion Date (both dates
inclusive), she will not, without the prior written consent of the Joint Financial Advisers,
directly or indirectly:(a)reduce her effective interest in the Shares (including the Consideration Sharesand Earnout Shares);(b)offer, pledge, sell, contract to sell, sell any option or contract to purchase,purchase any option or contract to sell, grant any option, right or warrant topurchase, lend, hypothecate, grant security over, encumber or otherwise transfer
or dispose of her interests in any shares in M17 Growth SPV LLC, M17 Growth
SPV B LLC, Northpark Advisory Ltd., Talent Dragon Co., Ltd. and Chia Nine
Investments Co., Ltd. (the “AT Entity Shares”) (or any securities convertible intoor exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the AT Entity Shares) or enter into a transaction that would havethe same effect, whether any such transaction described above is to be settled
by delivery of the AT Entity Shares or such other securities, in cash or otherwise;(c)enter into any swap, hedge or other transaction or arrangement (including aderivative transaction) that transfers to another, in whole or in part, any of theeconomic consequences of ownership of the AT Entity Shares (or any securities
convertible into or exercisable or exchangeable for or which carry rights to
subscribe for or purchase any of the AT Entity Shares), whether any suchtransaction described above is to be settled by delivery of the AT Entity Sharesor such other securities, in cash or otherwise;(d)deposit any of the AT Entity Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of AT
Entity Shares in any depository receipt facilities, whether any such transaction
described above is to be settled by delivery of AT Entity Shares or such othersecurities, in cash or otherwise;(e)enter into any transaction which is designed or which may reasonably be
expected to result in any of the above; or(f)announce or publicly disclose any intention to do any of the above.

298

LETTER TO SHAREHOLDERS(ii)

from the Completion Date up to and including the date falling six months after theCompletion Date (both dates inclusive), without the prior written consent of the Joint
Financial Advisers, directly or indirectly:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase,purchase any option or contract to sell, grant any option, right or warrant topurchase, lend, hypothecate, grant security over, encumber or otherwise transfer
or dispose of her holdings in any shares of the Company (including theConsideration Shares and Earnout Shares) (collectively, the “AT Lock-up
Shares”) (or any securities convertible into or exercisable or exchangeable for or
which carry rights to subscribe for or purchase any of the AT Lock-up Shares) or
enter into a transaction that would have the same effect, whether any suchtransaction described above is to be settled by delivery of the AT Lock-up Sharesor such other securities, in cash or otherwise;(b)enter into any swap, hedge or other transaction or arrangement (including aderivative transaction) that transfers to another, in whole or in part, any of theeconomic consequences of ownership of the AT Lock-up Shares (or any
securities convertible into or exercisable or exchangeable for or which carryrights to subscribe for or purchase any of the AT Lock-up Shares), whether any
such transaction described above is to be settled by delivery of the AT Lock-up
Shares or such other securities, in cash or otherwise;(c)deposit any of the AT Lock-up Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the AT
Lock-up Shares in any depository receipt facilities, whether any such transaction
described above is to be settled by delivery of the AT Lock-up Shares or suchother securities, in cash or otherwise;(d)enter into any transaction which is designed or which may reasonably be
expected to result in any of the above; and(e)announce or publicly disclose any intention to do any of the above.

Vertex Legacy Continuation Fund Pte. Ltd.
Vertex Legacy Continuation Fund Pte. Ltd. will agree with the Joint Financial Advisers that,from the Completion Date up to and including the date falling six months after theCompletion Date (both dates inclusive), it will not, without the prior written consent of the
Joint Financial Advisers, directly or indirectly:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchaseany option or contract to sell, grant any option, right or warrant to purchase, lend,
hypothecate, grant security over, encumber or otherwise transfer or dispose of its
holdings in any Shares (including the Consideration Shares and the Earnout Shares(if applicable)) (collectively, the “VLC Lock-up Shares”) (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the VLC Lock-up Shares) or enter into a transaction that would havethe same effect, whether any such transaction described above is to be settled bydelivery of the VLC Lock-up Shares or such other securities, in cash or otherwise;299

LETTER TO SHAREHOLDERS(b)enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of the VLC Lock-up Shares (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the VLC Lock-up Shares), whether any such transaction describedabove is to be settled by delivery of the VLC Lock-up Shares or such other securities,
in cash or otherwise;(c)deposit any of the VLC Lock-up Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the VLC
Lock-up Shares in any depository receipt facilities, whether any such transaction
described above is to be settled by delivery of the VLC Lock-up Shares or such othersecurities, in cash or otherwise;(d)enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; or(e)announce or publicly disclose any intention to do any of the above.

Vertex Growth Fund Pte. Ltd.
Vertex Growth Fund Pte. Ltd. will agree with the Joint Financial Advisers that, from theCompletion Date up to and including the date falling 6 months after the Completion Date(both dates inclusive), it will not, without the prior written consent of the Joint Financial
Advisers, directly or indirectly:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchaseany option or contract to sell, grant any option, right or warrant to purchase, lend,
hypothecate, grant security over, encumber or otherwise transfer or dispose of its
holdings in any Shares (including the Consideration Shares and the Earnout Shares(if applicable)) (collectively, the “VGF Lock-up Shares”) (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the VGF Lock-up Shares) or enter into a transaction that would havethe same effect, whether any such transaction described above is to be settled bydelivery of the VGF Lock-up Shares or such other securities, in cash or otherwise;(b)enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of the VGF Lock-up Shares (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the VGF Lock-up Shares), whether any such transaction describedabove is to be settled by delivery of the VGF Lock-up Shares or such other securities,
in cash or otherwise;(c)deposit any of the VGF Lock-up Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the VGF
Lock-up Shares in any depository receipt facilities, whether any such transaction
described above is to be settled by delivery of the VGF Lock-up Shares or such othersecurities, in cash or otherwise;(d)enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; or(e)announce or publicly disclose any intention to do any of the above.
300

LETTER TO SHAREHOLDERS
Vertex Ventures SEA Fund III Pte Ltd.
Vertex Ventures SEA Fund III Pte Ltd. will agree with the Joint Financial Advisers that, fromthe Completion Date up to and including the date falling six months after the Completion
Date (both dates inclusive), it will not, without the prior written consent of the Joint Financial
Advisers, directly or indirectly:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchaseany option or contract to sell, grant any option, right or warrant to purchase, lend,
hypothecate, grant security over, encumber or otherwise transfer or dispose of its
holdings in any Shares (including the Consideration Shares and the Earnout Shares(if applicable)) (collectively, the “VVS Lock-up Shares”) (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the VVS Lock-up Shares) or enter into a transaction that would havethe same effect, whether any such transaction described above is to be settled bydelivery of the VVS Lock-up Shares or such other securities, in cash or otherwise;(b)enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of the VVS Lock-up Shares (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the VVS Lock-up Shares), whether any such transaction describedabove is to be settled by delivery of the VVS Lock-up Shares or such other securities,
in cash or otherwise;(c)deposit any of the VVS Lock-up Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the VVS
Lock-up Shares in any depository receipt facilities, whether any such transaction
described above is to be settled by delivery of the VVS Lock-up Shares or such othersecurities, in cash or otherwise;(d)enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; or(e)announce or publicly disclose any intention to do any of the above.

Infinity e.Ventures Asia III, L.P.
Infinity e.Ventures Asia III, L.P. will agree with the Joint Financial Advisers that, from theCompletion Date up to and including the date falling six months after the Completion Date(both dates inclusive), it will not, without the prior written consent of the Joint Financial
Advisers, directly or indirectly:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchaseany option or contract to sell, grant any option, right or warrant to purchase, lend,
hypothecate, grant security over, encumber or otherwise transfer or dispose of its
holdings in any Shares (including the Consideration Shares and the Earnout Shares(if applicable)) (collectively, the “IEA Lock-up Shares”) (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the IEA Lock-up Shares) or enter into a transaction that would havethe same effect, whether any such transaction described above is to be settled bydelivery of the IEA Lock-up Shares or such other securities, in cash or otherwise;301

LETTER TO SHAREHOLDERS(b)enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of the IEA Lock-up Shares (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the IEA Lock-up Shares), whether any such transaction describedabove is to be settled by delivery of the IEA Lock-up Shares or such other securities,
in cash or otherwise;(c)deposit any of the IEA Lock-up Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the IEA
Lock-up Shares in any depository receipt facilities, whether any such transaction
described above is to be settled by delivery of the IEA Lock-up Shares or such othersecurities, in cash or otherwise;(d)enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; or(e)announce or publicly disclose any intention to do any of the above.

Dragon Alexander Limited
Dragon Alexander Limited will agree with the Joint Financial Advisers that, from theCompletion Date up to and including the date falling six months after the Completion Date(both dates inclusive), it will not, without the prior written consent of the Joint Financial
Advisers, directly or indirectly:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchaseany option or contract to sell, grant any option, right or warrant to purchase, lend,
hypothecate, grant security over, encumber or otherwise transfer or dispose of its
holdings in any Shares (including the Consideration Shares and the Earnout Shares(if applicable)) (collectively, the “DAL Lock-up Shares”) (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the DAL Lock-up Shares) or enter into a transaction that would havethe same effect, whether any such transaction described above is to be settled bydelivery of the DAL Lock-up Shares or such other securities, in cash or otherwise;(b)enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of the DAL Lock-up Shares (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the DAL Lock-up Shares), whether any such transaction describedabove is to be settled by delivery of the DAL Lock-up Shares or such other securities,
in cash or otherwise;(c)deposit any of the DAL Lock-up Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the DAL
Lock-up Shares in any depository receipt facilities, whether any such transaction
described above is to be settled by delivery of the DAL Lock-up Shares or such othersecurities, in cash or otherwise;(d)enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; or(e)announce or publicly disclose any intention to do any of the above.
302

LETTER TO SHAREHOLDERS
M17 Growth SPV B LLC
M17 Growth SPV B LLC will agree with the Joint Financial Advisers that, from theCompletion Date up to and including the date falling six months after the Completion Date(both dates inclusive), it will not, without the prior written consent of the Joint Financial
Advisers, directly or indirectly:(1)

offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchaseany option or contract to sell, grant any option, right or warrant to purchase, lend,
hypothecate, grant security over, encumber or otherwise transfer or dispose of its
holdings in any Shares (including the Consideration Shares and the Earnout Shares(if applicable)) (collectively, the “M17B Lock-up Shares”) (or any securities
convertible into or exercisable or exchangeable for or which carry rights to subscribe
for or purchase any of the M17B Lock-up Shares) or enter into a transaction that would
have the same effect, whether any such transaction described above is to be settled
by delivery of the M17B Lock-up Shares or such other securities, in cash or otherwise;(2)

enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of the M17B Lock-up Shares (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the M17B Lockup Shares), whether any such transaction describedabove is to be settled by delivery of the M17B Lock-up Shares or such other securities,
in cash or otherwise;(3)

deposit any of the M17B Lock-up Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the M17B
Lock-up Shares in any depository receipt facilities, whether any such transaction
described above is to be settled by delivery of the M17B Lock-up Shares or such othersecurities, in cash or otherwise;(4)

enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; or(5)announce or publicly disclose any intention to do any of the above.

Northpark Advisory Ltd.
Northpark Advisory Ltd. will agree with the Joint Financial Advisers that, from theCompletion Date up to and including the date falling six months after the Completion Date(both dates inclusive), it will not, without the prior written consent of the Joint Financial
Advisers, directly or indirectly:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchaseany option or contract to sell, grant any option, right or warrant to purchase, lend,
hypothecate, grant security over, encumber or otherwise transfer or dispose of its
holdings in any Shares (including the Consideration Shares and the Earnout Shares(if applicable)) (collectively, the “NPA Lock-up Shares”) (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the NPA Lock-up Shares) or enter into a transaction that would havethe same effect, whether any such transaction described above is to be settled bydelivery of the NPA Lock-up Shares or such other securities, in cash or otherwise;303

LETTER TO SHAREHOLDERS(b)enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of the NPA Lock-up Shares (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the NPA Lock-up Shares), whether any such transaction describedabove is to be settled by delivery of the NPA Lock-up Shares or such other securities,
in cash or otherwise;(c)deposit any of the NPA Lock-up Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the NPA
Lock-up Shares in any depository receipt facilities, whether any such transaction
described above is to be settled by delivery of the NPA Lock-up Shares or such othersecurities, in cash or otherwise;(d)enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; or(e)announce or publicly disclose any intention to do any of the above.

Talent Dragon Co., Ltd.
Talent Dragon Co., Ltd. will agree with the Joint Financial Advisers that, from theCompletion Date up to and including the date falling six months after the Completion Date(both dates inclusive), it will not, without the prior written consent of the Joint Financial
Advisers, directly or indirectly:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchaseany option or contract to sell, grant any option, right or warrant to purchase, lend,
hypothecate, grant security over, encumber or otherwise transfer or dispose of its
holdings in any Shares (including the Consideration Shares and the Earnout Shares(if applicable)) (collectively, the “TDC Lock-up Shares”) (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the TDC Lock-up Shares) or enter into a transaction that would havethe same effect, whether any such transaction described above is to be settled bydelivery of the TDC Lock-up Shares or such other securities, in cash or otherwise;(b)enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of the TDC Lock-up Shares (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the TDC Lock-up Shares), whether any such transaction describedabove is to be settled by delivery of the TDC Lock-up Shares or such other securities,
in cash or otherwise;(c)deposit any of the TDC Lock-up Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the TDC
Lock-up Shares in any depository receipt facilities, whether any such transaction
described above is to be settled by delivery of the TDC Lock-up Shares or such othersecurities, in cash or otherwise;(d)enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; or(e)announce or publicly disclose any intention to do any of the above.
304

LETTER TO SHAREHOLDERS
Chia Nine Investments Co., Ltd.
Chia Nine Investments Co., Ltd. will agree with the Joint Financial Advisers that, from theCompletion Date up to and including the date falling six months after the Completion Date(both dates inclusive), it will not, without the prior written consent of the Joint Financial
Advisers, directly or indirectly:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchaseany option or contract to sell, grant any option, right or warrant to purchase, lend,
hypothecate, grant security over, encumber or otherwise transfer or dispose of its
holdings in any Shares (including the Consideration Shares and the Earnout Shares(if applicable)) (collectively, the “CNI Lock-up Shares”) (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the CNI Lock-up Shares) or enter into a transaction that would havethe same effect, whether any such transaction described above is to be settled bydelivery of the CNI Lock-up Shares or such other securities, in cash or otherwise;(b)enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of the CNI Lock-up Shares (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the CNI Lock-up Shares), whether any such transaction describedabove is to be settled by delivery of the CNI Lock-up Shares or such other securities,
in cash or otherwise;(c)deposit any of the CNI Lock-up Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the CNI
Lock-up Shares in any depository receipt facilities, whether any such transaction
described above is to be settled by delivery of the CNI Lock-up Shares or such othersecurities, in cash or otherwise;(d)enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; or announce or publicly disclose any intention to do any of
the above.

M17 Growth SPV LLC
M17 Growth SPV LLC will agree with the Joint Financial Advisers that, from the Completion
Date up to and including the date falling six months after the Completion Date (both dates
inclusive), it will not, without the prior written consent of the Joint Financial Advisers,
directly or indirectly:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchaseany option or contract to sell, grant any option, right or warrant to purchase, lend,
hypothecate, grant security over, encumber or otherwise transfer or dispose of its
holdings in any Shares (including the Consideration Shares and the Earnout Shares(if applicable)) (collectively, the “M17 Lock-up Shares”) (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the M17 Lock-up Shares) or enter into a transaction that would havethe same effect, whether any such transaction described above is to be settled bydelivery of the M17 Lock-up Shares or such other securities, in cash or otherwise;305

LETTER TO SHAREHOLDERS(b)enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of the M17 Lock-up Shares (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the M17 Lock-up Shares), whether any such transaction describedabove is to be settled by delivery of the M17 Lock-up Shares or such other securities,
in cash or otherwise;(c)deposit any of the M17 Lock-up Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the M17
Lock-up Shares in any depository receipt facilities, whether any such transaction
described above is to be settled by delivery of the M17 Lock-up Shares or such othersecurities, in cash or otherwise;(d)enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; or(e)announce or publicly disclose any intention to do any of the above.

KTB China Synergy FundKTB China Synergy Fund will agree with the Joint Financial Advisers that, from theCompletion Date up to and including the date falling six months after the Completion Date(both dates inclusive), it will not, without the prior written consent of the Joint Financial
Advisers, directly or indirectly:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchaseany option or contract to sell, grant any option, right or warrant to purchase, lend,
hypothecate, grant security over, encumber or otherwise transfer or dispose of its
holdings in any Shares (including the Consideration Shares and the Earnout Shares(if applicable)) (collectively, the “KTB Lock-up Shares”) (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the KTB Lock-up Shares) or enter into a transaction that would havethe same effect, whether any such transaction described above is to be settled bydelivery of the KTB Lock-up Shares or such other securities, in cash or otherwise;(b)enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of the KTB Lock-up Shares (or any securities convertible
into or exercisable or exchangeable for or which carry rights to subscribe for orpurchase any of the KTB Lock-up Shares), whether any such transaction describedabove is to be settled by delivery of the KTB Lock-up Shares or such other securities,
in cash or otherwise;(c)deposit any of the KTB Lock-up Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the KTB
Lock-up Shares in any depository receipt facilities, whether any such transaction
described above is to be settled by delivery of the KTB Lock-up Shares or such othersecurities, in cash or otherwise;(d)enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; or(e)announce or publicly disclose any intention to do any of the above.
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LETTER TO SHAREHOLDERS
Key Executives (other than Phua Jiexian Joseph15 and Ng Jing Shen16)
The Key Executives (other than Phua Jiexian Joseph and Ng Jing Shen) will agree with the
Joint Financial Advisers that, from the Completion Date up to and including the date falling
six months after the Completion Date (both dates inclusive), they will not, without the priorwritten consent of the Joint Financial Advisers, directly or indirectly:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchaseany option or contract to sell, grant any option, right or warrant to purchase, lend,
hypothecate, grant security over, encumber or otherwise transfer or dispose of theirholdings in any Shares (including the EIS Shares (if applicable)) (collectively, the “KeyExecutive Lock-up Shares”) (or any securities convertible into or exercisable or
exchangeable for or which carry rights to subscribe for or purchase any of the Key
Executive Lock-up Shares) or enter into a transaction that would have the same effect,whether any such transaction described above is to be settled by delivery of the Key
Executive Lock-up Shares or such other securities, in cash or otherwise;(b)enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of the Key Executive Lock-up Shares (or any securities
convertible into or exercisable or exchangeable for or which carry rights to subscribe
for or purchase any of the Key Executive Lock-up Shares), whether any suchtransaction described above is to be settled by delivery of the Key Executive Lock-up
Shares or such other securities, in cash or otherwise;(c)deposit any of the Key Executive Lock-up Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the Key
Executive Lock-up Shares in any depository receipt facilities, whether any suchtransaction described above is to be settled by delivery of the Key Executive Lock-up
Shares or such other securities, in cash or otherwise;(d)enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; and(e)announce or publicly disclose any intention to do any of the above.

Confirmations obtained from the SGX-ST
Temasek will be a Controlling Shareholder of the Enlarged Group and is deemed interested
in the Shares held directly by Venezio, as well as the Shares held directly by FFMC, Vertex
SPV, Innoven, Pavilion and the Vertex Funds (together with FFMC, Vertex SPV, Innoven
and Pavilion, the “Concerned Entities”) in the Resulting Issuer. Please refer to Section
23.5 titled “Enlarged Group Corporate and Shareholding Structure – Significant Changes in
Percentage of Ownership” of this Circular for more details on Temasek’s interest in the
Resulting Issuer.

15

Please refer to Section 23.7 titled “Enlarged Group Corporate and Shareholding Structure – Moratorium – Phua
Jiexian Joseph” for details on the moratorium requirements applicable to Phua Jiexian Joseph.

16

Please refer to Section 23.7 titled “Enlarged Group Corporate and Shareholding Structure – Moratorium – Ng Jing
Shen” for details on the moratorium requirements applicable to Ng Jing Shen.

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LETTER TO SHAREHOLDERS
Venezio is an Associate of Temasek (in this regard, “Associate” of Temasek includes only
the following: the indirect wholly-owned subsidiary of Temasek whose board of directors orequivalent governing body comprise employees and nominees of (1) Temasek; (2) Temasek
Pte. Ltd. and/or (3) any direct and indirectly wholly-owned subsidiaries of Temasek Pte.
Ltd.). Venezio is indirectly wholly owned by Tembusu, which is also an Associate ofTemasek. Accordingly, each of Tembusu and Venezio will agree with the Joint Financial
Advisers to provide a moratorium in relation to, among others, the Venezio Securities as set
out above.
While Temasek is also deemed interested in the Shares held directly by the Concerned
Entities in the Resulting Issuer, unlike Venezio, each of the Concerned Entities is anindependently managed Temasek portfolio company and Temasek is not involved in thebusiness or operational decisions of these Concerned Entities, including their decisions inrelation to the Target Group and the Company. Accordingly, these Concerned Entities
should not be deemed as Associates of Temasek, and thus, FFMC, Innoven and Pavilion
will not be providing a moratorium in relation to the Shares held by them, and the indirect
holding entities, Pilatus Investments Pte. Ltd., Seviora Holdings Pte. Ltd. and Pavilion
Capital Holdings Pte.Ltd. will not be providing a moratorium in respect of their effective
interest in FFMC, Innoven and Pavilion. Save for the moratorium which will be provided by
the Sponsor, Vertex SPV and the Vertex Funds in relation to, among others, the Sponsor
Securities, the VLC Lock-up Shares, the VGF Lock-up Shares and the VVS Lock-up Sharesas set out above, no moratorium will be provided in respect of the Shares held directly by
FFMC, Innoven and Pavilion in the Resulting Issuer.
24.

PROPOSED DIRECTORS AND EXECUTIVE OFFICERS OF THE ENLARGED GROUP

24.1 Proposed Directors
The following table provides information regarding the Proposed Directors of the Enlarged
Group as of the Latest Practicable Date.

Name

Age

Address

Proposed Position in
the Enlarged Group

Mr. Phua Jiexian
Joseph(1)39c/o 138 Cecil Street, #13-02,
Cecil Court, Singapore (069538)

Director;
Non-Executive Chairman

Mr. Lien
Chien-Lin51

c/o 2-12-28, Kita-Aoyama,
Minato City, Tokyo, Japan

Executive Director

Mr. Akio Tanaka

53

c/o 2-12-28, Kita-Aoyama,
Minato City, Tokyo, Japan

Non-Executive Director

Mr. Tan Hup Foi

73

c/o 138 Cecil Street, #13-02,
Cecil Court, Singapore (069538)

Independent
Non-Executive Director

Dr. Steve Lai
Mun Fook72

c/o 138 Cecil Street, #13-02,
Cecil Court, Singapore (069538)

Independent
Non-Executive Director

Mr. Hideto
Mizuno50

c/o 2-12-28, Kita-Aoyama,
Minato City, Tokyo, Japan

Independent
Non-Executive Director

Ms. Chen Xiuling41

c/o 138 Cecil Street, #13-02,
Cecil Court, Singapore (069538)

Independent
Non-Executive Director

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LETTER TO SHAREHOLDERS
Note:(1) The current management of the Target Company will be the Proposed Directors of the Enlarged Group for
management continuity purposes. Mr. Lien Chien-Lin, the current CEO of the Target Company, will be
appointed as a Proposed Director of the Enlarged Group and will assume an executive role, and Mr. Phua
Jiexian Joseph, the current non-executive chairman of the board of directors of the Target Company, willassume a non-executive role in the Enlarged Group.

24.2 Experience of the Proposed Directors
Mr. Phua Jiexian Joseph is the co-founder of the Target Group and has been the
non-executive chairman of the board of directors of the Target Company since July 2020.
Mr. Phua is serving as the non-executive chairman of the board of directors of SoundOn Inc.
and the executive chairman of Turn Capital Pte. Ltd.17. He is serving as a non-executive
director of eight other companies. Mr. Phua served as the Target Company’s CEO from
September 2016 to June 2020 18 where he made major corporate decisions, managed
overall operations and set the strategic directions of the Target Company. Mr. Phua
co-founded Paktor Pte. Ltd. in 2013 while completing his Master of Business Administration
at the University of Chicago, and served as CEO of Paktor Pte. Ltd. from January 2013 to
October 2017, until Paktor Pte. Ltd. merged with the Target Company. He previously held
positions in the consulting and banking industries, at McKinsey & Company and Citigroup.
He also spent a few years in luxury retail with Da Vinci Asia from May 2008 to April 2011,
where he oversaw nationwide operations for the company’s fine watch and jewellerybusinesses. In 2019, Mr. Phua was awarded the Generation T List by Tatler to recognise
him as one of Asia’s 300 most promising young leaders. Mr. Phua holds a Master ofBusiness Administration degree from the University of Chicago Booth School of Businessand a Bachelor of Science degree from New York University Stern School of Business.
Mr. Lien Chien-Lin has served as the Target Company’s CEO since March 2023. Mr. Lien
joined the Target Company in September 2019 as the general manager of Taiwan
Operations. He was promoted to CEO of Taiwan, Southeast Asia, U.S. operations inJanuary 2021 and to global chief operating officer in August 2022 before he was appointed
as the Target Company’s global CEO. Mr. Lien has held management positions in various
Fortune 500 companies including Starbucks Coffee Company with hands-on experience inglobal operations, and has extensive experience in the gaming industry accumulated fromhis tenure at various gaming companies, including Electronic Arts. Prior to joining the Target
Company, Mr. Lien served as the chief operating officer of a mobile game start-up in
Shanghai focusing on narrative and user-generated content.

17

Mr. Phua is an executive director of Dragon Alexander Limited and Turn Capital Pte. Ltd. (“Turn Capital”). Dragon
Alexander Limited is a holding company incorporated solely to hold Mr. Phua’s interests in the Target Group and it
does not operate any other businesses. Turn Capital is an investment fund founded by Mr. Phua and its mandate is
to invest in technology companies in Asia, including SoundOn Inc.. None of these companies, including the portfolio
companies of Turn Capital Pte. Ltd., operate in the same industry as the Target Group and there is no direct overlap
in the businesses of these companies with the businesses of the Target Group. In the event there are any matters inwhich these companies, including the portfolio companies of Turn Capital, have an interest, Mr. Phua will abstain fromdeliberating and participating in discussion of such matters and voting on the relevant decisions of the Proposed New
Board and, where such matters require the approval of Shareholders, Mr. Phua and his Associates will abstain fromvoting on resolutions approving such matters. Based on the foregoing, there is no potential conflict of interests arisingfrom Mr. Phua’s interest in these companies and the Target Group.

18

After Mr. Phua Jiexian Joseph ceased to serve as the CEO of the Target Company in June 2020 and prior to Mr. Lien
Chien-Lin serving as the CEO of the Target Company in March 2023, Mr. Hirofumi Ono served as the CEO of theTarget Company from July 2020 to August 2022. The Target Company did not have a CEO from September 2022 toFebruary 2023, and the management role was taken by Mr. Lien Chien-Lin, who was the Chief Operating Officer of
the Target Company during such period.

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LETTER TO SHAREHOLDERS
Mr. Akio Tanaka has served as the Target Company’s director since March 2017.
Mr. Tanaka is also serving as an executive director of 14 companies and a non-executive
director of 21 companies. Mr. Tanaka is the co-founder and managing partner of Headline
Asia (formerly known as Infinity Venture Partners LLP) since 2008. Mr. Tanaka invests andco-founds early stage ventures in Asia, specialising in internet companies. Mr. Tanaka wasformerly the director of emerging market investments and corporate development for Adobe
Systems Inc and was responsible for the company’s international investment programmewith a focus on emerging markets in Asia covering digital media and entertainment sectors.
Mr. Tanaka holds a master’s degree and a bachelor’s degree, both in arts, from the
University of British Columbia, Canada.
Mr. Tan Hup Foi has served as the non-executive chairman of Caring Fleet Services
Limited as well as Orita Sinclair School of Design and Music Pte. Ltd., a private education
institution, since January 2010 and July 2011, respectively. Mr. Tan has over 30 years ofexperience in the transportation industry and was previously, among others, the CEO of
Trans-Island Bus Services Ltd. (now known as SMRT Buses Ltd.) from December 2001 to
October 2005 and the deputy president of SMRT Corporation Ltd from March 2003 to
October 2005. Mr. Tan has also served as an independent director of CSC Holdings Limited,
Credit Bureau Asia Limited and VTAC, since April 2006, November 2020 and January 2022
respectively. Mr. Tan was awarded the Public Service Medal (Pingat Bakti Masyarakat) in
1996 and the Public Service Star (Bintang Bakti Masyarakat) in 2008 by the President of the
Republic of Singapore. He also served in various capacities such as board member of theInstitute of Technical Education Board of Governors, Chairman of the Ngee Ann Polytechnic
Council, Chairman of the Industrial and Services Co-operative Society Limited and amember of the NTUC-U Care Fund Board of Trustees. Mr. Tan was also a Colombo Planscholar. He holds a Master of Science (Industrial Engineering) from The University ofSingapore and a Bachelor of Engineering (Hons) from Monash University.
Dr. Steve Lai Mun Fook served as the CEO of PSB Academy Pte. Ltd. and PSB
Technologies Pte. Ltd. from November 2007 to August 2012 and from April 2007 to March
2011, respectively. Prior to that, Dr. Lai served as the deputy CEO of TUV SUD PSB
Corporation Pte. Ltd. (later known as TUV SUD PSB Pte. Ltd.) and PSB Corporation Pte Ltd(later known as TUV SUD PSB Pte. Ltd.) from April 2006 to March 2007 and from April 2001
to March 2006, respectively. From April 1996 to March 2001, Dr. Lai served as the generalmanager of standards and technology services of the Singapore Productivity and Standards
Board. Dr. Lai joined the Singapore Institute of Standards and Industrial Research in March
1985 as a senior chemist where he managed client and internal technical projects inmaterials and chemical testing and consulting for two years. Dr. Lai has served as anindependent director on the board of Yongmao Holdings Limited, 3dsense Media School
Pte. Ltd., Singapore Institute of Power and Gas Pte. Ltd., Intraco Limited and VTAC since
December 2007, September 2014, January 2015, April 2015 and January 2022,
respectively. Dr. Lai holds a Doctor of Philosophy, a Bachelor of Science (Hons) in Industrial
Chemistry and a Diploma in Industrial Studies from the Loughborough University ofTechnology, United Kingdom.

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LETTER TO SHAREHOLDERS
Mr. Hideto Mizuno has served as an independent non-executive director of AEON Stores(Hong Kong) Co., Limited, Kowloon Hongkong since August 2018 and has served as thevice chairman of Mizuno Sports Promotion Foundation, a non-profit organisation, since July
2016, and has served as a director of Waterfield KK and Well-pedia KK since April 2018 and
September 2020, respectively. Mr. Mizuno currently serves as the business consultant at
Dr.Martens Airwair Japan Ltd and NAKED, inc.. Prior to that, Mr. Mizuno served as the
Highway & Concession Division Zone Director of Compass Group Japan Co., Ltd. From
June 2017 to February 2018, he served as the wholesale director of Timberland brand of VF
Japan Corporation. From June 2008 to June 2016, he served as the director of Mizuno
Corporation, where he led the U.S. branch’s corporate planning, national chain sales, newbusiness and global brand development. Mr. Mizuno holds a Bachelor of Arts in Economics
from Keio University, a Bachelor of Arts (Chemistry) from Carthage College and a Masterof Business Architect and IT Management from Kanazawa Institute of Technology.
Ms. Chen Xiuling is serving as a nominee director of ten companies. She has served as
the CFO of DW Capital Holdings Pte. Ltd. since July 2021, where she leads and manages
13X Single Family Office. Ms. Chen was the head of internal audit at Neil Professional
Services Pte. Ltd. from September 2019 to June 2021. From July 2013 to April 2017,
Ms. Chen served as audit manager at PricewaterhouseCoopers LLP. Ms. Chen is a memberof the Institute of Internal Auditors Singapore since October 2019, a member of the Instituteof Singapore Chartered Accountants since October 2015, and ASEAN Chartered
Professional Accountants Coordinating Committee (ACPACC) ASEAN Chartered
Professional Accountant since May 2018. Ms. Chen holds a Bachelor of Science inAccounting and Finance from the University of London in association with The London
School of Economics and Political Science, conducted through the Singapore Institute ofManagement.
Listed Company Experience
Two of the Proposed Directors, Mr. Tan Hup Foi and Dr. Steve Lai Mun Fook, have prior andcurrent experience as a director of a public listed company in Singapore and are familiar
with the rules and responsibilities of a director of a public listed company in Singapore.
The remaining Proposed Directors, Mr. Phua Jiexian Joseph, Mr. Lien Chien-Lin, Mr. Akio
Tanaka, Mr. Hideto Mizuno and Ms. Chen Xiuling, do not have prior experience as directorsof public listed companies in Singapore but have been briefed on the roles andresponsibilities of a director of a public listed company in Singapore in accordance with therequirements under the Mainboard Rules. Mr. Phua Jiexian Joseph, Mr. Lien Chien-Lin,
Mr. Akio Tanaka, Mr. Hideto Mizuno and Ms. Chen Xiuling will complete the prescribedmandatory training as specified under Practice Note 2.3 of the Listing Manual within one
year from the date of their respective appointments to the Proposed New Board.

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LETTER TO SHAREHOLDERS
24.3 Present and Past Directorships of the Proposed Directors
The list of present and past directorships of each Proposed Director over the last five years
preceding the Latest Practicable Date (excluding those held in the Target Group or theCompany), is set out below:
Name
Mr. Phua Jiexian
JosephPresent Directorships
•
•
•
•
•
•
•
•
•
•

Mr. Akio Tanaka

•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•

Past Directorships

Zuvio Tech Co., Ltd.
Goodnight Hi-Tech Pte. Ltd.
Pole Star Global Pte. Ltd.
Seadom Pte. Ltd.
SoundOn Inc.
Theodore Alexander International
Inc.
Turn Capital Pte. Ltd.
Gaigai Pte. Ltd.
Avana Global Limited
Dragon Alexander Limited•

Paktor Pte. Ltd.

LaunchPadFund 2 K.K.
TGAL Inc.
IVC II G.P.
Headline Asia V (GP), Ltd
IVC Advisory Co. Ltd.
JPYC, Inc.
ZAIKO PTE. LTD.
LaunchPadFund K.K.
Nudge Inc.
LUCA Japan Co., Ltd.
LUCA Co., Ltd.
XEN TECHNOLOGIES PTE. LTD.
IVC KARTAL, G.P.
IVC TIMSAH, G.P.
INFINITY VENTURES CRYPTO,
G.P.
Daqi, Inc.
International Compliance
Workshop (BVI) LTD
Yeahka Ltd.
Rekoo Media Limited
OPENLOGI Inc
Buyandship Holdings Limited
Infinity Ventures IV (GP), Ltd.
Alfred24 Holdings Limited (formerly
known as Pakpobox)
KKVideo Limited
Zomake Group Holdings Limited.
Inteluck Corporation Philippines
Yiku
Infinity e.ventures Asia III (GP),Ltd.
Pinkoi Inc.

•••IVP Fund B (GP), Ltd.
CreatingEV Inc.
EYEOTA HOLDINGS
PTE. LTD.
Dolphin Browser K.K.
Spider Labs, Ltd

312

•
•

LETTER TO SHAREHOLDERS
Name

Present Directorships

Past Directorships

•
•
•
•
•

Unearby Ltd.(Say Hi Ltd.)IVP Fund II B (GP), Ltd.
IVP ADVISORY CO.LTD
IVP Fund II A (GP), Ltd.
Growth Tree Ltd

Mr. Lien
Chien-Lin•••Ichi Nana Inc.
Next Entertainment Global Holding
Next Entertainment Limited•

Nil

Mr. Tan Hup Foi

•
•
•
•

Caring Fleet Services Limited
Credit Bureau Asia Limited
CSC Holdings Limited
Orita Sinclair School of Design andMusic Pte. Ltd.

•

Transit Link Pte. Ltd

Dr. Steve Lai Mun
Fook

•
•
•

3dsense Media School Pte. Ltd.
Intraco Limited
Singapore Institute of Power and
Gas Pte. Ltd.
Yongmao Holdings Limited•

Singapore Test
Services Private
LimitedK. A. Building
Construction Pte Ltd
K. A. Fabric Shutters
Pte. Ltd.
K. A. Firelite Pte. Ltd.
K. A. Group Holdings
Pte. Ltd.
K.A. Fireproofing
Pte. Ltd.

•

•
•
•
•
•

Ms. Chen Xiuling

•
•
•
•
•
•
•
•
•
•

Mr. Hideto Mizuno•••

DW Capital Holdings Pte. Ltd.
Atlaswise Consultants Pte. Ltd.
Sterling Capital Management Pte.
Ltd.
Warpcapital Yacht Management
Pte. Ltd.
Cloud Xero Management
Pte. Ltd.
Citylink Solutions Pte. Ltd.
Capital Zone Warehousing
Pte. Ltd.
Key Advisors Pte. Ltd.
Coleman College Pte. Ltd.
Neil Professional Services
Pte. Ltd.

••AEON Stores (Hong Kong) Co.,
Limited, Kowloon Hongkong
Waterfield KK
Well-pedia KK

•

313

•

Cub House Pte. Ltd.
Meritwise Group Public
Ltd
Huntsman Investments
Pte. LtdNilLETTER TO SHAREHOLDERS
24.4 Proposed Executive Officers
The following table provides information regarding the Proposed Executive Officers of theTarget Company as of the Latest Practicable Date.

Address

Proposed Position in
the Enlarged Group

Name

Age

Mr. Lien Chien-Lin

51

c/o 2-12-28, Kita-Aoyama,
Minato City, Tokyo, JapanCEO

Mr. Ng Jing Shen38

c/o 2-12-28, Kita-Aoyama,
Minato City, Tokyo, JapanCTO

Mr. Kenta Masuda37

c/o 2-12-28, Kita-Aoyama,
Minato City, Tokyo, Japan

CFO

24.5 Experience of the Proposed Executive Officers
Mr. Lien Chien-Lin is one of the Proposed Directors and the Target Company’s CEO. For
details of Mr. Lien’s working experience, please refer to Section 24.2 titled “Proposed
Directors and Executive Officers of the Enlarged Group – Experience of the Proposed
Directors” of this Circular.
Mr. Ng Jing Shen is the co-founder of the Target Group and has served as the Target
Company’s CTO since August 2022 and was the Target Company’s chief operating officer
from August 2019 to August 2022. Mr. Ng co-founded Paktor Pte. Ltd., a dating and social
networking platform which merged with 17 Media to form the Target Company (known as
M17 Entertainment Limited) in 2017 and was subsequently sold by the Target Company in2020. He served as Paktor’s CEO from November 2017 to August 2019 and CTO from
August 2013 to August 2019. Prior to that, Mr. Ng founded Restless, a platform for users tobrowse, search and book activities online in Singapore in February 2012. From October
2009 to December 2011, Mr. Ng was a software engineer at Amazon.com Inc., where he
was part of the team that re-architected the backbone of Amazon’s first cloud computing
service. Mr. Ng holds a Bachelor of Science in Engineering (Computer Science) from the
University of Michigan.
Mr. Kenta Masuda has served as the Target Company’s CFO since March 2023.
Mr. Masuda joined the Target Company in September 2021. Prior to joining the Target
Group, he served as the senior director of financial planning and analysis and treasury, andthe director of the Japan branch of a multinational retail corporation from January 2021 toSeptember 2021 and from November 2018 to January 2021, respectively. Mr. Masuda is acertified public accountant in Japan. He graduated from Doshisha University with a
Bachelor of Economics.

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LETTER TO SHAREHOLDERS
24.6 Present and Past Directorships of the Proposed Executive Officers
The list of present and past directorships of each Proposed Executive Officers over the last
five (5) years preceding the Latest Practicable Date (excluding those held in the Target
Group and the Company), is set out below:
Name
Mr. Lien Chien-Lin

Present Directorships••

Past Directorships
•

Nil

•

Ichi Nana Inc.
Next Entertainment Global
Holding
Next Entertainment Limited

Mr. Ng Jing Shen

•

Nil

•
•

Paktor Pte. Ltd.
Gaigai Pte. Ltd.

Mr. Kenta Masuda

•

Nil

•

Nil

24.7 Familial Relationships
There are no family relationships among any of the Directors, the Proposed Directors, theExecutive Officers, the Proposed Executive Officers and/or the current and incoming
Substantial Shareholders.
None of the Proposed Directors and/or Proposed Executive Officers have any immediatefamily member who is, or has been, for financial years ended 31 December 2021 and 2022,
employed by the Target Group and whose remuneration exceeds S$50,000 during therelevant financial year.
24.8 Arrangement or Understanding
None of the Directors, the Proposed Directors, the Executive Officers or the Proposed
Executive Officers has any arrangement or understanding with any of the current andincoming Substantial Shareholders, customers or suppliers of the Target Group or otherperson pursuant to which such Director or Executive Officer was appointed as a Director oras an Executive Officer.
Save as set out in Section 11 titled “Proposed Allotment and Issuance of the EIS Shares”
and Section 10 titled “Proposed Adoption of the Executive Incentive Scheme”, as at theLatest Practicable Date, there is no arrangement that involves the issue or grant of options
or shares or any other securities or securities-based derivatives contracts of the Company.
24.9 Terms of Proposed Directors and Proposed Executive Officers
Pursuant to the New Memorandum and Articles of Association, the Company may byordinary resolution appoint any person to be a Director or may by ordinary resolution
remove any Director. At each annual general meeting, one-third of the Directors for the time
being (or, if their number is not a multiple of three, the number nearest to but not less than
one-third) shall retire from office by rotation, provided always that, if required by the rules
and regulations of the SGX-ST, all Directors shall retire at least once every three years.

315

LETTER TO SHAREHOLDERSThe Directors to retire in every year shall be those subject to retirement by rotation who
have been longest in office since their last re-election or appointment and so that 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.
The Directors may appoint any person to be a Director, either to fill a casual vacancy or as
an additional Director, provided that the appointment does not cause the number of
Directors to exceed any number fixed by or in accordance with the New Memorandum andArticles of Association as the maximum number of Directors. Any person so appointed by
the Directors shall hold office only until the next annual general meeting. Such Director shallthen be eligible for re-election, but shall not be taken into account in determining thenumber of Directors who are to retire by rotation at such meeting.
No person other than a Director retiring at the meeting shall, unless recommended by the
Directors for election, be eligible for appointment as a Director at any general meeting
unless not less than 11 nor more than 42 clear calendar days (exclusive of the date on
which the notice is given) before the date appointed for the meeting there shall have been
lodged at the registered office of the Company notice in writing signed by some Shareholder(other than the person to be proposed) duly qualified to attend and vote at the meeting forwhich such notice is given of such Shareholder’s intention to propose such person forelection or notice in writing signed by the person to be proposed giving such person’s
consent to the nomination and signifying that person’s candidature for the office, provided
always that in the case of a person recommended by the Directors for election not less thannine clear calendar days’ notice shall be necessary and notice of each and every such
person shall be served on the Shareholders at least seven calendar days prior to themeeting at which the election is to take place.
The office of a Director shall be vacated if (a) such Director gives notice in writing to theCompany that he resigns the office of Director; (b) such Director absents himself, herself oritself (for the avoidance of doubt, without being represented by proxy) from threeconsecutive meetings of the Board without special leave of absence from the Directors, andthe Directors pass a resolution that such Director has by reason of such absence vacatedoffice; (c) such Director dies, has a bankruptcy order made against such Director or makes
any arrangement or composition with such Director’s creditors generally; (d) such Director
becomes mentally disordered (including being of unsound mind) and incapable of managing
such Director’s affairs or if in Singapore or elsewhere an order shall be made by any court
claiming jurisdiction in that behalf on the ground (however formulated) of mental disorderfor such Director’s detention or for the appointment of a guardian or for the appointment ofa receiver or other person (by whatever name called) to exercise powers with respect tosuch Director’s property or affairs; (e) such Director shall become disqualified from acting
as a Director in any jurisdiction for reasons other than on technical grounds (in which event
such Director must immediately resign from the board); or (f) such Director is removed fromoffice by ordinary resolution.

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LETTER TO SHAREHOLDERS
24.10 Employment Agreements and Indemnification Agreements
Existing Employment Agreements
The Company has not entered into any employment agreements with any of the Directors
or Proposed Directors.
Employment Agreements and Indemnification Agreements upon Completion
The Company expects to enter into an employment agreement with the Proposed Executive
Director for an initial term of five years which will be automatically extended, unless either
the Company or the Proposed Executive Director gives the other party not less than six
months’ prior written notice of its intention not to extend the employment agreement at any
time prior to the expiration of any five-year term or unless terminated earlier pursuant to theterms of such employment agreement.
The Company may terminate the employment for cause, at any time, without notice or
remuneration, for certain acts of the Proposed Executive Director, including but not limited
to the disqualification to act as Proposed Executive Director under any applicable laws or
regulations, the commitments of any serious or persistent breach or non-observance of theterms and conditions of the employment, bankruptcy or conviction of a criminal offenceother than one which in the opinion of the Proposed New Board does not affect theexecutive’s position, misconduct being inconsistent with the due and faithful discharge of
the Proposed Executive Director’s material duties, fraud or dishonesty, or habitual neglectof his duties.
Upon termination, the Proposed Executive Director shall, among others, immediately resignfrom all positions and offices held in the Company and deliver to the Company all
documents relating to the business or affairs of the Company which may be in his
possession or under his control.
The Proposed Executive Director will not be entitled to any benefits upon termination of theemployment agreement. The employment agreement covers the terms of employment,
specifically salaries and bonuses.
Pursuant to the terms of the employment agreement, the Proposed Executive Director’s
remuneration will comprise (a) a base salary; and (b) a discretionary bonus that may beawarded from time to time based on the recommendation of the Proposed New
Remuneration Committee and subject to the approval of our Board.
The Proposed Executive Director has agreed to hold, both during and after the employment
agreement expires or is earlier terminated, in strict confidence and not to use or disclose
to any person, corporation or other entity without written consent, any confidential
information or trade secrets, unless such information is generally available and known tothe public through no fault of the Proposed Executive Director. The Proposed Executive
Director has also agreed to disclose in confidence and assign to the Company all
inventions, improvements, designs, original works of authorship, formulas, processes,
compositions of matter, computer software programmes, databases, mask works, concepts
and trade secrets which the Proposed Executive Director may solely or jointly conceive ordevelop or reduce to practice, or cause to be conceived or developed or reduced topractice, during the period of the Proposed Executive Director’s employment with theCompany that are either related to the scope of the employment or make use of theCompany’s resources. In addition, the Proposed Executive Director has agreed to be boundby non-competition and non-solicitation restrictions set forth in his employment agreement.
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LETTER TO SHAREHOLDERS
The Proposed Executive Director has agreed to devote all his working time and attention to
the Company’s business and use best efforts to perform his duties to develop theCompany’s business and interests. Moreover, the Proposed Executive Director has agreed
not to, for a certain period following termination of his employment or expiration of theemployment agreement: (i) carry on or be engaged, concerned or interested directly or
indirectly whether as shareholder, director, employee, partner, agent or otherwise carry on
any business in direct competition with the Company, (ii) solicit or entice away any of theCompany’s customer, client, representative or agent, or (iii) employ, solicit or entice away
or attempt to employ, solicit or entice away any of the Company’s officers, managers,
consultants or employees.
The Company expects to enter into indemnification agreements with the Proposed
Directors, pursuant to which the Company will agree to indemnify the Proposed Directors
against certain liabilities and expenses incurred by such persons in connection with claims
made by reason of their being a director of the Company.
24.11 Management Reporting Structure
The following chart shows the proposed management reporting structure of the Enlarged
Group following the Completion.

Proposed
New Board

CFO(Mr. Kenta Masuda)

CEO(Mr. Lien Chien-Lin)

CTO(Mr. Ng Jing Shen)

Data

New
Business
Initiatives

Engineering

GlobalOperations

FinanceLive
Commerce

Human
Resources

Internal
Control

MachineLearning

Game

Legal

Intellectual
Property

V-Liver

Investor
RelationsLive
Streaming

Product
Development

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LETTER TO SHAREHOLDERS
24.12 Compensation of Directors and Executive Officers
In the financial year ended 31 December 2022, the Target Company paid an aggregate of
US$957,477 in cash and benefits to the Target Company’s executive officers, and theTarget Company did not pay any compensation to the Target Company’s directors during
the same period, except to Mr. Phua Jiexian Joseph, as chairman of the Target Company’sboard of directors. The Target Company had set aside or accrued any amount to provide
pension, retirement or other similar benefits to the Target Company’s executive officers
according to the local employment laws. The Target Company had no service contracts withany of the Target Company’s directors providing for benefits upon termination of
employment. For share incentive grants to the Target Company’s directors and executive
officers, please refer to Section 24.12 titled “Proposed Directors and Executive Officers of
the Enlarged Group – Compensation of Directors and Executive Officers – 17LIVE Cayman
ESOP” of this Circular.
The compensation (which includes salary, bonus, benefits-in-kind, contributions to theCentral Provident Fund Scheme in Singapore and directors’ fees and bonuses) paid to theTarget Company’s directors and executive officers for services rendered to the Target
Company in any capacity in an aggregate basis in the financial years ended 31 December
2021 and 2022 and the estimated amount of compensation to be paid for the current
financial year ending 31 December 2023, is as follows:
Name

FY2021

FY2022Estimated for FY2023

Band 1

Band 1

Band 1

Mr. Lien Chien-Lin

N/A

N/A

Band 1

Mr. Akio Tanaka

N/A

N/A

Band 1

Mr. Tan Hup Foi

N/A

N/A

Band 1

Dr. Steve Lai Mun Fook

N/A

N/A

Band 1

Mr. Hideto Mizuno

N/A

N/A

Band 1

Ms. Chen Xiuling

N/A

N/A

Band 1

Mr. Lien Chien-Lin

Band 2

Band 2

Band 2

Mr. Ng Jing ShenBand 2

Band 2

Band 2

Mr. Kenta Masuda

Band 1

Band 1

Band 1

Proposed Directors
Mr. Phua Jiexian Joseph

Proposed Executive Officers

Notes:(1) Remuneration bands:“Band 1” refers to compensation of between S$0 and S$250,000 per annum.
“Band 2” refers to compensation between S$250,001 and S$500,000 per annum.
“Band 3” refers to compensation between S$500,001 and S$750,000 per annum.
(2)

N/A – Not employed or appointed by the Target Company during the relevant period.

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LETTER TO SHAREHOLDERS
The estimated amount of compensation in the current financial year of FY2023 excludes
any bonus or profit-sharing plan or any other profit-linked agreement or arrangement assuch bonuses are discretionary in nature and are determined by the board of directors of
the Target Company at the end of each financial year, taking into account the Target
Company’s performance for that financial year.
The Target Company’s Japanese subsidiaries are subject to the Companies Act of Japan,
under which compensation for directors and corporate auditors, including bonuses,
retirement allowances and incentive share awards, must be approved at the relevant
subsidiary’s general meeting of shareholders. The shareholders’ approval may specify theupper limit of the aggregate amount of compensation or calculation methods and, in suchcases, compensation for a director or corporate auditor is fixed by the Proposed New Boardor discussion by corporate auditors, respectively.
The Target Company’s Taiwan subsidiaries are required under the Taiwan Company Act toprovide the Target Company’s directors with compensation in accordance with their articles
of association and the relevant shareholders’ meeting resolutions. Except for directors,
supervisors and general manager, the Target Company’s Taiwan subsidiaries are required
by Taiwan laws and regulations to contribute no less than 6% of an employee’s monthly
salary into a specific account as part of the employee’s pension for the employee (the “NewPension Scheme”). However, for the foreign employees who work in Taiwan who are notsubject to the New Pension Scheme, the Target Company’s Taiwan subsidiaries shallcontribute 2% to 15% of the monthly wage to the labour pension reserve fund account of theemployer.
The Target Company’s Hong Kong subsidiaries are required by the Hong Kong Mandatory
Provident Fund Schemes Ordinance to make monthly contributions to the mandatory
provident fund scheme in an amount equal to at least 5% of an employee’s salary subject
to a cap of HK$1,500 per month per employee.
The Target Company’s Singapore subsidiary is required by the laws and regulations ofSingapore to make contributions, as employers, to the Central Provident Fund for the
Proposed Executive Officers who are employed by the Target Company’s Singapore
subsidiary and are Singapore citizens or Singapore permanent residents (“SPR”) asprescribed under the Central Provident Fund Act 1953 of Singapore. The minimum
contribution rates vary, depending on the age of the relevant Proposed Executive Officer,
and whether he/she is a Singapore citizen, SPR in his/her year of SPR status, SPR in
his/her second year of SPR status or SPR who has had SPR status for three years or more.
17LIVE Cayman ESOPAs of the Latest Practicable Date, the Target Company maintains share incentive plans topromote the success of the Target Company’s business by providing additional incentives
to attract, motivate, retain and reward its officers, employees, directors and other eligible
persons.
The Target Company adopted a share incentive plan in June 2017, in February 2018, andin September 2020, respectively (collectively, “17LIVE Cayman ESOP”), pursuant to whichan aggregate of 21,919,656 ordinary shares were reserved for grant of awards thereunder.
As of the Latest Practicable Date, 18,349,125 RSUs have been granted and vested
pursuant to the 17LIVE Cayman ESOP (“17LIVE Vested RSUs”), 3,027,215 RSUs were
granted pursuant to the 17LIVE Cayman ESOP but have not vested (“17LIVE Unvested
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LETTER TO SHAREHOLDERS
RSUs”), and 543,316 RSUs were available for future grants. All of the granted awards are
subject to vesting conditions as set out in the relevant 17LIVE RSU agreements.
The RSUs issued to the Target Company’s directors and executive officers for services
rendered to the Target Company in any capacity on an aggregate basis in the financial
years ended 31 December 2021 and 2022 and the estimated amount of RSUs to be issued
for the current financial year ending 31 December 2023, is as follows:
Name

FY2021

FY2022

N/A

N/A

Estimated for FY2023

Proposed Directors
Mr. Phua Jiexian Joseph

(1)

N/A
(2)

Mr. Lien Chien-Lin

125,000

Mr. Akio Tanaka

N/A

N/A

N/A

Mr. Tan Hup Foi

N/A

N/A

N/A

Dr. Steve Lai Mun Fook

N/A

N/A

N/A

Mr. Hideto Mizuno

N/A

N/A

N/A

Ms. Chen Xiuling

N/A

N/A

N/A

Mr. Lien Chien-Lin

125,000(1)2,150,000(2)N/A

Mr. Ng Jing Shen

N/A

N/A

N/A

Mr. Kenta Masuda

100,000

4,073

150,000

2,150,000

N/A

Proposed Executive Officers

Notes:(1) These entries refer to the same issuance to Mr. Lien Chien-Lin in FY2021.
(2) These entries refer to the same issuance to Mr. Lien Chien-Lin in FY2022.

As of the Latest Practicable Date, there are a total of 21,376,340 17LIVE RSUs which havebeen granted to the directors, executive officers, consultants, employees and former
employees as a group. The following table summarises the number of 17LIVE RSUs that
the Target Company has granted to its directors and executive officers as of the Latest
Practicable Date.
Name

All 17LIVE RSUs

Mr. Phua Jiexian
Joseph–Mr. Lien Chien-Lin

Mr. Akio Tanaka

Date of Grant

Date of Expiration––

500,000

1 January 2020

31 December 2029

125,000

1 January 2021

31 December 2030

75,0001 January 2022

31 December 2025

500,000

22 August 2022

22 August 2026

1,200,000

22 August 2022

31 December 2024

500,000

22 August 2022

22 August 2026

–

–

–

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LETTER TO SHAREHOLDERS
Name
Mr. Ng Jing Shen

Mr. Kenta Masuda

All 17LIVE RSUs

Date of Grant

Date of Expiration

545,149

12 September 2014

11 September 2024

2,206,122

1 November 201631 October 2026

545,149

30 September 2015

29 September 2025

784,215

1 October 2020

30 September 2030

784,215

1 October 2020

30 September 2030

100,000

13 September 2021

30 September 2031

4,073

1 July 2022

30 June 2032

150,000

1 February 2023

31 January 2033

Termination of 17LIVE Cayman ESOP upon Completion
The 17LIVE Cayman ESOP will be terminated at Completion and all rights of the 17LIVE
Unvested RSU Holders under the 17LIVE Cayman ESOP will be extinguished.
Please refer to Section 12 titled “Proposed Adoption of the Company Employee Share
Option Scheme” of this Circular for further details.
25.

INTERESTED PERSON TRANSACTIONS AND POTENTIAL CONFLICTS OF INTEREST
Certain terms such as “Associate”, “Associated Company”, “control”, “Controlling
Shareholder”, “Interested Person” and “Interested Person Transaction” used in this section
have the meanings as provided in the Mainboard Rules, the SFR and the section titled“Definitions of this Circular”, unless the context specifically requires the application of thedefinitions in one or the other as the case may be.
In line with the rules set out in Chapter 9 of the Mainboard Rules, a transaction for which
value is less than S$100,000 is not considered material in the context of the initial businesscombination and is not taken into account for the purposes of aggregation in this section.
The SGX-ST has allowed the Resulting Issuer to use the market capitalisation at the timeof commencement of trading of the Resulting Issuer on the first trading date under the newname “17LIVE Group Limited” as the reference point for computing the thresholds under
Rules 905 and 906 of the Mainboard Rules prior to the release of the audited consolidated
financial results for FY2023 of the Resulting Issuer on SGXNET.

25.1 Past Interested Persons Transactions
During the Period Under Review and up to the Latest Practicable Date, there were no past
Interested Person Transactions between the Target Group and Interested Persons which
are material in the context of the Proposed Transactions.
25.2 Present and On-going Interested Persons Transactions
During the Period Under Review and up to the Latest Practicable Date, there were no
present and on-going Interested Person Transactions between the Target Group andInterested Persons which are material in the context of the Proposed Transactions.

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25.3 Future Interested Persons Transactions
In general, a transaction between the Enlarged Group and any of its Interested Persons
would constitute an Interested Person Transaction for the purposes of Chapter 9 of the
Mainboard Rules.
Shareholders should note that upon Completion, any material transaction entered into
between the Enlarged Group and any of the Interested Persons would constitute Interested
Person Transactions for the purposes of Chapter 9 of the Mainboard Rules.
25.4 Guidelines and Review Procedures for Future Interested Person Transactions
Following Completion, all future Interested Person Transactions will be reviewed andapproved in accordance with the threshold limits set out under Chapter 9 of the Mainboard
Rules, to ensure that they are carried out on normal commercial terms and are notprejudicial to the interests of the Company and its minority Shareholders. In the event thatsuch Interested Person Transactions require the approval of the Proposed New Board or
the Proposed New Audit Committee, relevant information will be submitted to the Proposed
New Board or the Proposed New Audit Committee for review. In the event that such
Interested Person Transactions require the approval of Shareholders, additional
information may be required to be presented to Shareholders and an independent financial
adviser may be appointed for an opinion.
In the review of all future Interested Person Transactions, the following procedures will beapplied:(1)

transactions (either individually or as part of a series or if aggregated with othertransactions involving the same related party during the same financial year) equal toor exceeding S$100,000 in value but below 3.0% of the value of the net tangible assetsof the Enlarged Group will be subject to review by the Proposed New Audit Committee
at least on a semi-annual basis, or such other frequency as deemed necessary;(2)transactions (either individually or as part of a series or if aggregated with othertransactions involving the same related party during the same financial year) equal toor exceeding 3.0% but below 5.0% of the value of the net tangible assets of theEnlarged Group will be subject to the review and prior approval of the Proposed New
Audit Committee. Such approval shall only be given if the transactions are on normal
commercial terms and are consistent with similar types of transactions made with
non-interested parties; and(3)transactions (either individually or as part of a series or if aggregated with othertransactions involving the same related party during the same financial year) equal toor exceeding 5.0% of the value of the net tangible assets of the Enlarged Group will
be subject to review and prior approval by the Proposed New Audit Committee, whichmay, as it deems fit, request advice on the transaction from independent advisers,
including valuations from independent professional valuers.

A register will be maintained to record all Interested Person Transactions (incorporating thebasis, amount and nature, on which they are entered into and any quotation from unrelatedparties obtained to support such basis). The Proposed New Audit Committee will review all
Interested Person Transactions to ensure that the prevailing rules and regulations of the
SGX-ST (in particular, Chapter 9 of the Mainboard Rules) are complied with. The Company
will also endeavour to comply with the recommendations set out in the CG Code.

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LETTER TO SHAREHOLDERS
The annual internal audit plan will incorporate a review of all Interested Person
Transactions entered into. The Proposed New Audit Committee will review internal audit
reports to ascertain that the guidelines and procedures established to monitor Interested
Person Transactions have been complied with. In addition, the Proposed New Audit
Committee will also review from time to time such guidelines and procedures to determine
if they are adequate and/or commercially practicable in ensuring that transactions between
the Enlarged Group and its Interested Persons are conducted on normal commercial terms.
Transactions falling within the above categories, if any, will be reviewed quarterly by the
Proposed New Audit Committee to ensure that they are carried out on normal commercial
terms and in accordance with the procedures outlined above. All relevant non-quantitative
factors will also be taken into account.
Such review includes the examination of the relevant transaction and its supporting
documents or such other data deemed necessary by the Proposed New Audit Committee.
The Proposed New Audit Committee may request any additional information pertaining to
the transaction under review from independent sources, advisers or professional valuers as
it deems fit. The Proposed New Audit Committee will also ensure that all disclosure,approval and other requirements on Interested Person Transactions, including thoserequired by prevailing legislation, the Mainboard Rules and relevant accounting standards,
are complied with.
In the event that a member of the Proposed New Audit Committee is interested in any
Interested Person Transaction, he/she will abstain from reviewing that particulartransaction. The Company will also disclose the aggregate value of Interested Person
Transactions conducted during the current financial year in its annual report, as required
pursuant to the Mainboard Rules.
25.5 Potential Conflicts of Interest
Save as disclosed below, none of the Proposed Directors, the Proposed Executive Officers,
the Controlling Shareholders of the Company or any of their Associates has an interest,
direct or indirect:(1)

in any transaction to which the Enlarged Group was or is to be a party;(2)

in any entity carrying on the same business or dealing in similar services which
competes materially and directly with the existing business of the Enlarged Group; and(3)

in any enterprise or company that is the customer or supplier of goods and servicesof the Enlarged Group.

Temasek (being a deemed Controlling Shareholder of the Company) is the holding
company of Mediacorp Pte Ltd, a content creator and media network in Singapore which
operates a suite of TV channels, radio stations and multiple digital platforms. Mediacorp Pte
Ltd, being an indirect wholly-owned subsidiary of Temasek, is an independently-managed
Temasek portfolio company. Temasek is not involved in the business or operational
decisions of Mediacorp Pte Ltd. In addition, Temasek is a global investment company
headquartered in Singapore. Its portfolio covers a broad spectrum of industries:
transportation and industrials; financial services; telecommunications, media andtechnology; consumer and real estate; and life science and agri-food. Temasek may, fromtime to time, make investments in other businesses in the countries in which the Enlarged
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LETTER TO SHAREHOLDERS
Group operates. As a result, there may be circumstances where the businesses of theEnlarged Group compete directly with other Temasek portfolio companies. As a matter oflong-standing governance policy, Temasek does not direct the business decisions oroperations of its portfolio companies, which are guided and managed by their respective
boards of directors and management teams, independently of Temasek. Temasek does notdirect, and is not involved in, the business, commercial or operational decisions of theTarget Group and the Company.
Save as disclosed in Section 24.10 titled “Proposed Directors and Executive Officers of theEnlarged Group – Employment Agreements and Indemnification Agreements” of thisCircular, none of the Proposed Directors has any interest in any existing contract orarrangement which is significant in relation to the business of the Enlarged Group.
Mitigation of Potential Conflicts of Interest
Following Completion, any potential conflicts of interest, whether with its Proposed
Directors, Controlling Shareholders and their respective Associates or otherwise, will be
mitigated as follows:(1)

the Proposed Directors have a duty to disclose their interests in respect of any
contract, proposal, transaction or any other matter whatsoever in which they have any
personal material interest, directly or indirectly, or any actual or potential conflicts ofinterest (including conflicts of interest that arise from any of their directorships orexecutive positions or personal investments in any other corporations) involving them.
Upon such disclosure, such directors shall abstain from voting in respect of any suchcontract, arrangement, proposal, transaction or matter in which the conflict of interest
arises, unless and until the Proposed New Audit Committee has determined that nosuch conflict of interest exists;(2)

the Proposed New Audit Committee is required to examine the internal control
procedures and review procedures to determine if such procedures put in place aresufficient to ensure that Interested Person Transactions are conducted on normal
commercial terms and will not be prejudicial to the Company and its minority
Shareholders;(3)

the Proposed New Audit Committee will review any actual or potential conflicts ofinterest that may involve the Proposed Directors as disclosed by them to the Proposed
New Board. Upon disclosure of an actual or potential conflict of interests by a
Proposed Director, the Proposed New Audit Committee will consider whether a conflictof interest does in fact exist. A Proposed Director who is a member of the Proposed
New Audit Committee will not participate in any proceedings of the Proposed New
Audit Committee in relation to the review of a conflict of interest relating to him or her.
The review will include an examination of the nature of the conflict and such relevant
supporting facts, as the Proposed New Audit Committee may deem reasonably
necessary;325

LETTER TO SHAREHOLDERS

26.

(4)

the Company is required to make prompt announcements, disclosures in its annual
report and/or seek Shareholders’ approval for certain material Interested Person
Transactions pursuant to Chapter 9 of the Mainboard Rules. The Proposed New Audit
Committee may also have to appoint independent financial advisers to review such
Interested Person Transactions and opine on whether such transactions are fair andreasonable to the Company, and not prejudicial to the Company’s interests and theinterests of its minority Shareholders; and(5)

the Proposed Directors owe fiduciary duties to the Company, including the duty to act
in good faith and in its best interests. The Proposed Directors are also subject to a dutyof confidentiality that, save to the extent permitted under Singapore law, precludes him
or her from disclosing to any third party (including any of the Shareholders or their
Associates) information that is confidential.

CORPORATE GOVERNANCE

The Board and the Proposed New Board recognise the importance of corporate governance andthe offering of high standards of accountability to the Shareholders, and will use best efforts toimplement the good practices recommended in the CG Code. The Proposed New Board willcontinue to have three committees, namely, the Proposed New Nominating Committee, theProposed New Remuneration Committee and the Proposed New Audit Committee.
Upon Completion, Mr. Lien Chien-Lin will be appointed as the Executive Director and CEO.
Mr. Joseph Phua will be appointed as the Non-Executive Chairman and Mr. Akio Tanaka will be
appointed as the Non-Executive Director. Mr. Tan Hup Foi, Dr. Steve Lai Mun Fook, Ms. Chen
Xiuling and Mr. Hideto Mizuno will be appointed as the Independent Non-Executive Directors.
Accordingly, upon Completion, the Company will have seven Directors, of which one is an
executive director, two are non-executive directors and four are independent directors.
26.1 Board Practices
The Proposed New Board will have overall responsibility for the corporate governance of
the Enlarged Group so as to protect and enhance long-term Shareholder value. It will set
the overall strategy for the Enlarged Group and supervise executive management andmonitor their performance. Apart from its statutory responsibilities, the Proposed New
Board will be responsible for, amongst others:(a)providing entrepreneurial leadership, and setting strategic objectives for the Enlarged
Group, which will include appropriate focus on value creation, innovation andsustainability;(b)ensuring that the necessary resources are in place for the Enlarged Group to meet its
strategic objectives;(c)establishing and maintaining a sound risk management framework to effectively
monitor and manage risks faced by the Enlarged Group, and to achieve an appropriatebalance between risks and company performance;(d)constructively challenging the management of the Company and reviewing its
performance;

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LETTER TO SHAREHOLDERS(e)instilling an ethical corporate culture and ensuring that the Company’s values,
standards, policies and practices are consistent with the culture; and(f)ensuring transparency and accountability to key stakeholder groups of the Enlarged
Group.

The Proposed Directors will be appointed by the Shareholders at a general meeting, and anelection of Directors will take place annually. One third (or the number nearest one third) of
the Directors will be required to retire from office at each annual general meeting. Further,
all the Directors will be required to retire from office at least once every three years.
However, a retiring Director will be eligible for re-election at the meeting at which he retires.
At any time or from time to time, Shareholders shall also have the power to remove a
Director before the expiration of this period of office and appoint any person as a Director
to fill the place of a Director so removed.
26.2 Proposed New Nominating Committee
It is intended that the Nominating Committee be re-constituted upon Completion. The
Proposed New Nominating Committee will comprise three Directors, all of whom, including
the Chairman of the Proposed New Nominating Committee, are independent. The Proposed
New Nominating Committee will comprise Dr. Steve Lai Mun Fook, Mr. Hideto Mizuno and
Ms. Chen Xiuling. The Chairman of the Proposed New Nominating Committee will be
Dr. Steve Lai.
The Proposed New Nominating Committee will be responsible for, inter alia, the following:(a)making recommendations to the Proposed New Board on relevant matters relating to(i) the review of board succession plans for directors, in particular, the Executive
Director and CEO, and key management personnel; (ii) the reviewing of training andprofessional development programmes for the Proposed New Board, the board
committees and the Directors; and (iii) the appointment and re-appointment of the
Directors (including alternate Directors, if applicable), including the criteria used to
identify and evaluate potential new directors and channels used in searching for
appropriate candidates;(b)reviewing and determining annually, and as and when circumstances require, if a
Director is independent, in accordance with the Listing Manual, the CG Code and anyother salient factors;(c)reviewing the composition of the Proposed New Board annually to ensure that the
Proposed New Board and the Proposed New Board Committees (i) comprise Directors
who as a group provide an appropriate balance and diversity of skills, expertise,gender and knowledge of the Enlarged Group and provide core competencies such asaccounting or finance, business or management experience, industry knowledge,
strategic planning experience and customer-based experience and knowledge; (ii) areof an appropriate size; and (iii) are of an appropriate level of independence anddiversity of thought and background in its composition to enable it to make decisions
in the best interests of the Company;

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LETTER TO SHAREHOLDERS(d)ensuring that the Directors disclose their relationships with the Company, its related
corporations, the Substantial Shareholders or the officers of the Company, if any,
which may affect their independence and reviewing such disclosures from the
Directors and highlighting these to the Proposed New Board as required;(e)reviewing and determining whether the Director is able to and has been adequately
carrying out his duties as Director, taking into consideration the Director’s number oflisted company board representations and other principal commitments. Where a
Director has multiple board representations and principal commitments which involvea significant time commitment, providing a reasoned assessment of the ability of the
Director to diligently discharge his duties;(f)setting the objectives for achieving board diversity and reviewing the progress towards
achieving these objectives;(g)taking into consideration all factors as may be specified in the CG Code and theaccompanying Practice Guidance (as each may, from time to time, be amended,
modified or supplemented) in carrying out its duties;(h)developing the diversity of the members of the Proposed New Board and disclosing in
the Enlarged Group’s board diversity policy (if any) or a summary thereof in thecorporate governance report;(i)identifying candidates and reviewing and approving nominations for the positions of
Director or alternate Director (whether in relation to the appointment or re-appointmentof such Directors), reviewing and approving the membership of the Board committees(including the Proposed New Audit Committee, the Proposed New Remuneration
Committee and the Proposed New Nominating Committee) as well as appraising thequalifications and experience of any proposed new appointments to the Proposed New
Board and making recommendations to the Proposed New Board on whether theappointments should be approved;(j)reviewing and approving any new employment of any officer occupying a managerial
position and above who is a relative of any Director and the proposed terms of theiremployment;(k)determining and recommending to the Proposed New Board the maximum number oflisted company board representations which any Director may hold and disclosing thisin the Enlarged Group’s annual report;(l)reviewing the Proposed New Nominating Committee’s terms of reference annually andrecommending any proposed changes to the Proposed New Board for approval; and(m) assuming such other duties (if any) that may be required by law or the Listing Manual
and/or the CG Code (as each may be, from time to time, amended, modified or
supplemented).

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LETTER TO SHAREHOLDERS
In addition, the Proposed New Nominating Committee will make recommendations to the
Proposed New Board on the development of a process for evaluation and performance of
the Proposed New Board, its board committees and directors. In this regard, the Proposed
New Nominating Committee will decide how the Proposed New Board’s performance is tobe evaluated and propose objective performance criteria which address how the Proposed
New Board has enhanced long-term shareholder value. The Proposed New Nominating
Committee will also implement a process for assessing the effectiveness of the Proposed
New Board as a whole and the Proposed New Board committees and for assessing thecontribution of each individual Director to the effectiveness of the Proposed New Board.
The Non-Executive Chairman will act on the results of the performance evaluation of the
Proposed New Board, and in consultation with the Proposed New Nominating Committee,
propose, where appropriate, new members to be appointed to the Proposed New Board or
seek the resignation of Directors.
Each member of the Proposed New Nominating Committee is required to abstain fromvoting, approving or making a recommendation on any resolutions of the Proposed New
Nominating Committee in which he has a conflict of interest in the subject matter underconsideration.
The Proposed New Nominating Committee’s view of the Proposed Independent
Directors
The Proposed New Nominating Committee, having taken into consideration the following:(a)the number of listed company directorships held by each of the Proposed Independent
Directors;(b)

the principal commitments of the Proposed Independent Directors;(c)

the confirmations by the Proposed Independent Directors stating that they are eachable to devote sufficient time and attention to the matters of the Enlarged Group;(d)the confirmations by the Proposed Independent Directors that each of them is notaccustomed or under an obligation, whether formal or informal, to act in accordancewith the directions, instructions or wishes of any Controlling Shareholder of theEnlarged Group, has no relationship with the Company, its related corporations or withany directors of these corporations, its Substantial Shareholders or its officers that
could interfere or be reasonably perceived to interfere, with the exercise of his or her
independent business judgement with a view to the best interests of the Company;(e)the Proposed Independent Directors’ working experience and expertise in different
areas of specialisation; and(f)the composition of the Proposed New Board,

is of the view that (i) the Proposed Independent Directors are 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 the Company; and (ii) the Proposed
Independent Directors, as a whole, represent a strong and independent element on the
Proposed New Board which is able to exercise objective judgement on corporate affairs
independently from the Controlling Shareholders.

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LETTER TO SHAREHOLDERS
26.3 Proposed New Remuneration Committee
The Remuneration Committee will be re-constituted upon Completion. The Proposed New
Remuneration Committee will comprise three Directors, all of whom, including the
Chairman of the Proposed New Remuneration Committee, are independent. The Proposed
New Remuneration Committee will comprise Dr. Steve Lai Mun Fook, Mr. Tan Hup Foi and
Mr. Hideto Mizuno. The Chairman of the Proposed New Remuneration Committee will be
Dr. Steve Lai Mun Fook.
The Proposed New Remuneration Committee will be responsible for, inter alia, thefollowing:(a)reviewing and recommending to the Proposed New Board, in consultation with the
Non-Executive Chairman of the Proposed New Board, for endorsement, acomprehensive remuneration policy framework and guidelines for remuneration of the
Directors and other persons having authority and responsibility for planning, directing
and controlling the activities of the Enlarged Group (“Key Management Personnel”);(b)reviewing and recommending to the Proposed New Board, for endorsement, thespecific remuneration packages for each of the Directors and Key Management
Personnel;(c)reviewing and approving the design of all share option plans, performance share plans
and/or other equity based plans;(d)considering all aspects of remuneration (including but not limited to, Directors’ fees,salaries, allowances, bonuses, options, share-based incentives and awards, benefitsin-kind and termination payments) and termination terms, to ensure they are fair andthat the level and structure of remuneration are appropriate and proportionate to thesustained performance and value creation of the Company, taking into accountstrategic objectives;(e)in the case of service contracts, reviewing the Enlarged Group’s obligations arising in
the event of termination of the Executive Director’s or Key Management Personnel’scontracts of service, to ensure that such contracts of service contain fair andreasonable termination clauses which are not overly generous, with a view to being
fair and avoiding the reward of poor performance;(f)approving performance targets for assessing the performance of each of the Key
Management Personnel and recommend such targets as well as employee specificremuneration packages for each of such Key Management Personnel, forendorsement by the Proposed New Board;(g)reviewing the remuneration policies, level and mix of remuneration, the procedure forsetting remuneration, and the relationships between remuneration, performance andvalue creation and the statements in the annual report of the Company with a view toachieving clear disclosure of the same;(h)approving the remuneration proposals with reference to the Proposed New Board’s
corporate goals and objectives;330

LETTER TO SHAREHOLDERS(i)ensuring compliance with any requirement, direction and regulation that may from time
to time be prescribed by the Proposed New Board or contained in the Memorandum
and Articles of Association or imposed by relevant applicable legislation andregulations;(j)reviewing the Proposed New Remuneration Committee’s terms of reference annuallyand recommending any proposed changes to the Proposed New Board for approval;
and

(k)

assuming such other duties (if any) that may be required by law or the Listing Manual
and/or the CG Code (as each may be, from time to time, amended, modified or
supplemented).

The Proposed New Remuneration Committee also periodically considers and reviews
remuneration packages in order to maintain their attractiveness, to retain and motivate the
Directors to provide good stewardship of the Enlarged Group and key executives tosuccessfully manage the Enlarged Group, and to align the level and structure of
remuneration with the long-term interests and risk policies of the Enlarged Group.
If a member of the Proposed New Remuneration Committee has an interest in a matterbeing reviewed or considered by the Proposed New Remuneration Committee, he will
abstain from voting on the matter.
26.4 Proposed New Audit Committee
It is intended that the Audit Committee be re-constituted upon Completion. The Proposed
New Audit Committee will comprise three Directors, all of whom, including the Chairman of
the Proposed New Audit Committee, are independent. The Proposed New Audit Committee
will comprise Mr. Tan Hup Foi, Dr. Steve Lai Mun Fook and Ms. Chen Xiuling. The Chairmanof the Proposed New Audit Committee will be Mr. Tan Hup Foi.
The Proposed New Audit Committee will assist the Proposed New Board in discharging its
responsibility to safeguard the Enlarged Group’s assets, maintain adequate accounting
records and develop and maintain effective systems of internal control, with the overall
objective of ensuring that the management creates and maintains an effective control
environment in the Enlarged Group. The Proposed New Audit Committee shall meet, at aminimum, twice a year.
The Proposed New Audit Committee will provide a channel of communication between the
Directors, the management and the external auditor on matters relating to audit.
The Proposed New Audit Committee will meet periodically and will, inter alia, perform thefollowing functions:(a)assisting the Proposed New Board in discharging its statutory responsibilities on
financing and accounting matters;(b)reviewing significant financial reporting issues and judgements to ensure theintegrity of the financial statements and any formal announcements relating tofinancial performance;

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LETTER TO SHAREHOLDERS(c)reviewing the scope and results of the external audit and its cost effectiveness,and the independence and objectivity of the external auditor;(d)reviewing the external auditor’s audit plan and audit report, and the external
auditor’s evaluation of the system of internal accounting controls as well as
monitoring and reviewing the Enlarged Group’s implementation of any
recommendations to address any internal control weaknesses highlighted by theexternal auditor;(e)reviewing the key financial risk areas, including overseeing the implementation of
the transfer pricing policy;(f)reviewing the risk management structure and any oversight of the risk
management process and activities to mitigate and manage risk at acceptablelevels determined by the Proposed New Board;(g)reviewing and reporting to the Proposed New Board the suitability of the auditing
firms appointed for the significant foreign-incorporated subsidiaries andassociated companies of the Enlarged Group;(h)reviewing and reporting to the Proposed New Board at least annually (i) the
adequacy and effectiveness of the risk management and internal controls systemsof the Enlarged Group, including financial, operational, compliance controls, andinformation technology controls and (ii) the implementation of risk treatment plansin relation to the foregoing;(i)reviewing the statements to be included in the annual report concerning theadequacy and effectiveness of the risk management and internal controls systemsof the Enlarged Group, including financial, operational, compliance controls, andinformation technology controls, with a view to achieving clear disclosure of thesame and including any material issues arising from the internal auditor’s review
of our internal control policies and procedures and how these material issues havebeen addressed with the implementation of the mitigating measures;(j)reviewing regulatory compliance matters, at least on a quarterly basis, with a viewto ensuring that adequate rectification measures are taken for past breaches aswell as new initiatives implemented to mitigate and reduce the risks of future
breaches;(k)reviewing any Interested Person Transactions (including transactions under any
general mandate approved by Shareholders pursuant to Chapter 9 of the Listing
Manual) and monitoring the procedures established to regulate Interested Person
Transactions, including ensuring compliance with the Enlarged Group’s internal
control system and the relevant provisions of the Listing Manual, as well as all
conflicts of interests to ensure that proper measures to mitigate such conflicts ofinterests have been put in place;(l)ensuring that the internal audit function is adequately resourced and has
appropriate standing within the Enlarged Group;332

LETTER TO SHAREHOLDERS(m)commissioning an independent audit on internal controls and risk managements
systems for the Proposed New Audit Committee’s assurance where necessary or
where the Proposed New Audit Committee is not satisfied with the systems ofinternal controls or risk management of the Enlarged Group;(n)commissioning and reviewing the findings of internal investigations into matterswhere there is any suspected fraud or irregularity, failure of internal controls or
infringement of any law, rule or regulation which has, or is likely to have, a material
impact on the Company’s operating results and/or financial position and ensuringthat appropriate follow-up actions are taken;(o)monitoring and reviewing the implementation of any recommendations by the
Enlarged Group to satisfactorily address any internal control weaknesses
highlighted by the external auditor and/or internal auditor;(p)monitoring and reviewing the rectification of the outstanding internal control
weaknesses, including assessing the effectiveness of the measures implemented
to rectify the internal control weaknesses which have been resolved prior toCompletion;(q)reviewing the scope and results of the internal audit procedures, and at least
annually, the adequacy and effectiveness of the internal audit function of theEnlarged Group;(r)

approving the hiring, removal, evaluation and compensation of the head of theinternal audit function, or the accounting/auditing firm or corporation to which theinternal audit function is outsourced (if any);(s)appraising and reporting to the Proposed New Board on the audits undertaken by
the external auditor and internal auditor and the adequacy of disclosure of
information;(t)making recommendations to the Proposed New Board on the proposals to
Shareholders on the appointment, reappointment and removal of the external
auditor, and approving the remuneration and terms of engagement of the external
auditor;(u)reviewing the adequacy and effectiveness, independence, scope and results of theexternal audit and internal audit function;(v)

reviewing the adequacy of and approving procedures put in place related to any
hedging policies to be adopted by the Enlarged Group;(w)

ensuring that the Company publicly discloses, and clearly communicates to
employees, the existence of a whistle-blowing policy and procedures for raisingsuch concerns;(x)assessing the performance of the CFO, financial director and/or the financial
controller (as the case may be), for the relevant period, on an annual basis todetermine his or her suitability for the position;333

LETTER TO SHAREHOLDERS(y)meeting with the external auditor, and with the internal auditor, in each casewithout the presence of management, at least annually and reviewing theco-operation extended to the internal auditor and the external auditor;(z)approving the hiring, removal, evaluation and compensation of the accounting or
auditing firm or corporation to which the internal audit function is outsourced (if
any);

(aa)

reviewing the nature, extent and costs of non-audit services performed by theexternal auditor, to ensure their independence and objectivity;(bb)

undertaking such other reviews and projects as may be requested by the Proposed
New Board, and report to the Proposed New Board its findings from time to timeon matters arising and requiring the attention of the Proposed New Audit
Committee;(cc)taking into consideration all factors as may be specified in the CG Code and theaccompanying Practice Guidance (as each may, from time to time, be amended,
modified or supplemented) in carrying out all its duties;(dd)

reviewing the half-yearly and annual financial statements before submitting thesame to the Proposed New Board for approval, focusing in particular on changes
in accounting policies and practices, major risk areas, significant adjustments
resulting from the audit, compliance with accounting standards and compliancewith the Mainboard Rules and any other relevant statutory or regulatory
requirements;(ee)reviewing the assurance from the CEO and the CFO on the financial records andfinancial statements of the Enlarged Group;(ff)

reviewing the risk profile of the Enlarged Group and the appropriate steps to betaken to mitigate and manage risks at acceptable levels determined by the
Proposed New Board;(gg)

reviewing the adequacy and effectiveness of the Enlarged Group’s risk
management function, ensuring that a clear reporting structure is in place between
the Proposed New Audit Committee and the internal auditors, and reviewing theadequacy, effectiveness, independence, scope and results of the internal audit
function and procedures and the Management Team’s response and follow-up
actions;(hh)reviewing any actual or potential conflicts of interest, including those referred to
the Proposed New Audit Committee or which may involve the Directors as
disclosed by them to the Proposed New Board and which may affect the exerciseof their fiduciary duties;(ii)

reviewing transactions falling within the scope of Chapter 10 of the Mainboard
Rules, if any;

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LETTER TO SHAREHOLDERS(jj)

periodically reviewing the Enlarged Group’s intellectual property protection
policies to ensure that the policies and/or procedures are complied with, and are
adequate and effective for the Enlarged Group’s operations;(kk)reviewing and establishing procedures for receipt, retention and treatment ofcomplaints received in relation to the Enlarged Group, including criminal offences
involving the Enlarged Group or its employees, questionable accounting, auditing,business, safety or other matters that may negatively impact the Enlarged Groupand ensuring that arrangements are in place for independent investigations ofsuch matters and for appropriate follow-up actions to be taken;(ll)reviewing the Proposed New Audit Committee’s terms of reference annually andrecommending any proposed changes to the Proposed New Board for approval;
and

(mm)

undertaking generally such other functions and duties as may be required by law
or the Mainboard Rules, including any amendments made thereto from time totime.

Apart from the duties listed above, the Proposed New Audit Committee will ensure that
arrangements are in place for employees to raise concerns, in confidence, about possible
wrongdoing in financial reporting or other matters for appropriate follow-up action. The
Proposed New Audit Committee will also commission and review the findings of internal
investigations into such matters or matters where there is any suspected fraud or
irregularity, or failure of internal controls, or infringement of any law, rule or regulation which
has or is likely to have a material impact on the Enlarged Group’s operating results andfinancial position.
In the event that a member of the Proposed New Audit Committee is interested in any
matter being considered by the Proposed New Audit Committee, he will abstain from
reviewing and deliberating on that particular transaction or voting on that particularresolution.
26.5 Adequacy of Internal Controls
Following Completion, the business of the Enlarged Group will comprise wholly of thebusiness of the Target Group, and thus the internal controls of the Company and the Target
Group will be harmonised. Therefore, in preparation for the Proposed Business
Combination, the Target Company has commissioned Ernst & Young Advisory Pte. Ltd. to
conduct an internal control review of key business processes for identifying gaps within theinternal controls framework and recommending controls improvement plans and measures
to the Target Group. The Proposed New Board also noted that Ernst & Young Advisory Pte.
Ltd. has reviewed the implementation of the recommendations for observations raised inrelation to the Target Group’s internal control weaknesses and noted that management has
implemented the recommendations as agreed. As such, based on the internal control
review report, all material internal control weaknesses have been addressed by the
management of the Target Company relating to the Target Group’s systems of internal
controls (including financial, operational, compliance and information technology controls)
and risk management systems.

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LETTER TO SHAREHOLDERS
The Proposed New Audit Committee has held discussions with Mr. Kenta Masuda, theproposed new CFO, as well as Ernst & Young LLP, the Independent Auditor and Reporting
Accountant to the Target Group, in relation to the Target Group’s internal controls. The
Proposed New Board has noted that no material internal control weakness had been raisedby Ernst & Young LLP in the course of their audit of the Target Group’s financial statements
for FY2020, FY2021 and FY2022. The Proposed New Board also noted that the Target
Group has implemented measures recommended by Ernst & Young LLP, or implemented
mitigating measures, to address the risks arising from the issues identified by Ernst &Young LLP in relation to the internal accounting control systems of the Target Group
reviewed by Ernst & Young LLP.
The Target Group has established an adequately resourced in-house internal audit division
which is responsible for the internal audit of the Target Group, and which reports directly to
the Proposed New Board. The internal audit division will prepare an internal audit plan,
which will be presented to and approved by the board of directors of the relevant Target
Group subsidiary, and the internal audit findings are reported to the board of directors of therelevant Target Group subsidiary on a semi-annual basis. The Target Group has also put inplace a system of internal controls which is embodied within the internal audit policies andprocedures of the Target Group subsidiaries.
Based on the above and the internal controls established and maintained by the Enlarged
Group (including the internal audit division), the work performed by Ernst & Young Advisory
Pte. Ltd. and the external auditor, and reviews performed by the Enlarged Group’s
management and the Proposed New Board, the Proposed New Board, after making all
reasonable enquiries and to the best of its knowledge and belief, is of the opinion that therisk management systems and the internal controls (including financial, operational,
compliance and information technology controls) of the Enlarged Group, are adequate andeffective. The Proposed New Audit Committee concurs with the Proposed New Board’s
opinion on the adequacy and effectiveness of the Enlarged Group’s internal controls(including financial, operational, compliance and information technology controls) and risk
management systems.
The Proposed New Board notes that the system of internal controls and risk management
systems provides reasonable, but not absolute, assurance that the Enlarged Group will not
be adversely affected by any event that could be reasonably foreseen as it works to achieve
its business objectives. In this regard, the Proposed New Board also notes that no system
of internal controls and risk management systems can provide absolute assurance against
the occurrence of material errors, poor judgement in decision making, human error, losses,
fraud or other irregularities.
The Proposed New Audit Committee shall also commission an annual internal control audit
to satisfy itself that the Enlarged Group’s internal controls and risk management systems
are robust and effective enough to mitigate the Enlarged Group’s internal control
weaknesses (if any). Upon completion of the internal control audit, appropriate disclosure
will be made via SGXNET of any material, price-sensitive internal control weaknesses andany follow up actions to be taken by the Proposed New Board, if applicable.

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LETTER TO SHAREHOLDERSThe Company has in place a whistle-blowing policy, which is administered by the Proposed
New Audit Committee. The whistle-blowing policy provides employees with well-definedand accessible channels for reporting unlawful conduct, financial malpractice or dangers, orother similar matters to the Proposed New Audit Committee, and for appropriate follow-up
action to be taken. The policy aims to encourage the reporting of such matters in good faith,with confidence on the part of employees making such reports, that they will be treated fairly
and to the extent possible, be protected from possible reprisal or victimisation. Concerns
about possible improprieties may be raised verbally or in writing by emailing such concerns
to the Proposed New Audit Committee.
26.6 Risk Management and Internal Controls of the Target GroupAs the Target Group may be exposed to various risks in its operation, it endeavours tomaintain sound and effective internal controls to safeguard its interests and assets at all
times. Since establishment, the Target Group has adopted a standardised corporate
governance system which embodies a scientific decision-making, implementation andsupervision mechanism. The Target Group has formulated and is constantly enhancing its
risk management policy covering environmental control, business control, capital control,
financial accounting control, human resources control, information technology control
throughout its operations. The Target Group has established its risk management
committee which participates in the monthly meeting of the risk and compliance committee.
26.7 The Proposed New Audit Committee’s Opinion on the Suitability of the CFO
The Proposed New Audit Committee having (i) conducted an interview with Kenta Masuda;(ii) considered the qualifications and past working experience of Kenta Masuda (asdescribed in Section 24.4 titled “Proposed Directors and Executive Officers of the Enlarged
Group – Proposed Executive Officers” of this Circular); (iii) observed his demonstration of
the requisite competency, familiarity and diligence in relation to the financial matters andinformation of the Enlarged Group; (iv) noted the absence of negative feedback from Ernst& Young LLP, the Independent Auditor and Reporting Accountant to the Target Group;(v) noted the absence of internal control weaknesses attributable to Kenta Masuda that was
identified during the an internal control review conducted by Ernst & Young Advisory Pte.
Ltd.; and (vi) interacted with Kenta Masuda in his capacity as the CFO and the views of andfeedback from the management team of the Target Company, is of the view that Kenta
Masuda has the necessary expertise and experience to discharge his duties, and is suitable
for the position of CFO of the Enlarged Group. The Proposed New Audit Committee also
noted that no comment has been raised by the Target Group’s internal auditor in theirdealings with Kenta Masuda.
After making all reasonable enquiries, and to the best of the knowledge and belief of the
Proposed New Audit Committee, nothing has come to the attention of the members of the
Proposed New Audit Committee to cause them to believe that Kenta Masuda does not havethe competence, character and integrity expected of a CFO of a listed issuer.

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LETTER TO SHAREHOLDERS
26.8 The Audit Committee’s Opinion on the Suitability of the Independent Business Valuer
Independence of the Independent Business Valuer
The Audit Committee is of the view that Frost & Sullivan Limited, the Independent Business
Valuer, is independent from Frost & Sullivan (Singapore) Pte Ltd, the IMR Consultant, forthe following reasons:(a)while the two entities share the Frost & Sullivan brand, Frost & Sullivan Limited andFrost & Sullivan (Singapore) Pte Ltd are separate legal entities and are not, directly or
indirectly, related to each other. The two entities operate independently from eachother, with separate teams involved in their respective workstreams;(b)

Frost & Sullivan Limited’s and Frost & Sullivan (Singapore) Pte Ltd’s professional feesin connection with the Proposed Business Combination are US$100,000 and
US$180,000 respectively, and their respective professional fees are not contingent oneach other. Other than the fees that each of them will receive as part of their
engagement for the work done for the Proposed Business Combination, Frost &Sullivan Limited and Frost & Sullivan (Singapore) Pte Ltd do not have any otherinterest in the success of the Proposed Business Combination; and(c)the work undertaken by each of Frost & Sullivan Limited and Frost & Sullivan(Singapore) Pte Ltd is independent of the other, and the conclusions that each of them
arrive at in their reports are not dependent on the other.

Competence of the Independent Business Valuer
While the Independent Business Valuer is not a member of a professional businessvaluation body or authority and is not registered with IVAS as a Chartered Valuer andAppraiser, the Independent Business Valuer’s independent valuation has been performedin line with recognised valuation standards (such as the International Valuation Standards).
The Independent Business Valuer has also complied with the disclosure requirements
under Practice Note 2 (Minimum Disclosure Requirements for Summary Valuation Letters)
issued by IVAS in the preparation of the Valuation Report.
26.9 Information Disclosure
Following the Completion, the Enlarged Group will continue to implement a policy ofproviding full disclosure of material corporate information in accordance with the Mainboard
Rules, through announcements, press releases and shareholders’ circulars as well as
through the interim and annual financial results announcements.

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LETTER TO SHAREHOLDERS
27.

SHARE PRICE & MARKETSThe share prices of the Company traded on Mainboard for the relevant periods are set out
below:(a)

The annual highest and lowest market prices for the three most recently completed
financial years:
Financial Year(b)High (S$)

Low (S$)FY2020N/A

N/A

FY2021

N/A

N/A

FY2022

5.18

4.52

The highest and lowest market prices for each financial quarter of the two mostrecently completed financial years and each subsequent financial quarter prior to theLatest Practicable Date:
Financial Quarter(c)High (S$)

Low (S$)

1Q2021

N/A

N/A

2Q2021

N/A

N/A

3Q2021

N/A

N/A

4Q2021

N/A

N/A

1Q20225.18

4.88

2Q2022

4.99

4.69

3Q2022

4.76

4.61

4Q2022

4.72

4.52

1Q2023

4.69

4.47

2Q2023

4.71

4.51

3Q20234.81

4.61

The highest and lowest market prices for each of the most recent six months prior to
the Latest Practicable Date:
MonthHigh (S$)

Low (S$)May 2023

4.70

4.55

June 2023

4.71

4.56

July 2023

4.81

4.63

August 2023

4.75

4.61

September 2023

4.81

4.65

October 2023

4.98

4.74

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LETTER TO SHAREHOLDERS(d)

The last transacted price of the Shares on Mainboard on 29 September 2023, being
the Market Day on which the Shares were last traded immediately prior to the date of
the Announcement was S$4.81; and(e)

The last transacted price of the Shares on Mainboard on 30 October 2023, being theMarket Day immediately preceding the Latest Practicable Date was S$4.92.

The Shares are generally traded on Mainboard and there has been no significant tradingsuspension that has occurred on Mainboard in respect of the Shares during the three years
immediately preceding the Latest Practicable Date.
28.

DIVIDEND POLICYStatements contained in this section that are not historical facts are forward-looking
statements. Such statements are subject to certain risks and uncertainties which could
cause actual results to differ materially from those which may be forecast and projected.
Under no circumstances should the inclusion of such information herein be regarded as arepresentation, warranty or prediction with respect to the accuracy of the underlying
assumptions by the Company, the Joint Financial Advisers or any other person. Investors
are cautioned not to place undue reliance on these forward-looking statements that speak
only as at the date hereof. Please refer to the section titled “Cautionary Note on
Forward-Looking Statements” of this Circular for further details.

28.1 The Company
The Company has not declared or paid any dividends in the last two financial years ended
31 December 2021 and 31 December 2022 since its incorporation, and the period from
1 January 2023 to the Latest Practicable Date.
The Company does not have a fixed dividend policy.
28.2 The Target GroupThe Target Group has not declared or paid any dividends in the last three financial years
ended 31 December 2020, 2021 and 2022, and the period from 1 January 2023 to the Latest
Practicable Date.
The Target Group does not have a fixed dividend policy. The declaration and payment of
future dividends may be recommended by its directors at their discretion, after considering
a number of factors, including the level of reserve or reserves which shall be applicable formeeting contingency, or for equalising dividends or for any other purpose to which those
funds may be properly applied and pending such application.
Any dividends the Target Company declares must be approved by an ordinary resolution ofits shareholders at a general meeting. The Target Company is not permitted to pay
dividends in excess of the amount recommended by its directors. The directors may pay
dividends either in cash or in specie and may determine the extent to which amounts may
be withheld therefrom. All dividends shall be declared and paid according to the amounts
paid up on the shares, subject to the rights and restrictions for the time being attached tothese shares. The dividends do not bear any interest against the Target Company. All
dividends must be paid in accordance with the Target Company’s Memorandum and Articles
of Association (as amended from time to time) and the laws of the Cayman Islands.
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LETTER TO SHAREHOLDERS
28.3 The Enlarged GroupAs at the Latest Practicable Date, the Enlarged Group does not have a fixed dividend policy.
The declaration and payment of dividends will be determined at the sole discretion of the
Proposed New Board, subject to the approval of Shareholders (if required).
The form, frequency and amount of future dividends on the Shares that the Proposed
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 the
Proposed Directors:(a)the level of cash, gearing and retained earnings of the Enlarged Group;(b)

actual and projected financial performance of the Enlarged Group;(c)the projected levels of capital expenditure and expansion plans of the Enlarged Group;(d)the working capital requirements of the Enlarged Group and general financing
condition; and(e)restrictions on payment of dividends imposed on the Enlarged Group by its financing
arrangements (if any).

Under the New Memorandum and Articles of Association, subject to the Cayman
Companies Act and the New Memorandum and Articles of Association and except asotherwise provided by the rights attached to any Shares, the Directors may resolve to pay
dividends and other distributions on Shares in issue and authorise payment of the dividends
or other distributions out of the funds of the Company lawfully available therefor. A dividend
shall be deemed to be an interim dividend unless the terms of the resolution pursuant towhich the Directors resolve to pay such dividend specifically state that such dividend shallbe a final dividend. No dividend or other distribution shall be paid except out of the realised
or unrealised profits of the Company, out of the share premium account or as otherwise
permitted by law.
Except as otherwise provided by the rights attached to any Shares, all dividends shall be
paid according to the par value of the Shares that a Shareholder holds. If any Share isissued on terms providing that it shall rank for dividend as from a particular date, that Shareshall rank for dividend accordingly, provided that where such Shares are partly paid, alldividends or other profits or distributions must be apportioned and paid proportionately tothe amounts paid or credited as paid on the partly paid Shares. Information relating to taxes
payable on dividends is set out in Section 31 titled “Exchange Control and Taxation” of thisCircular. All dividends must be paid in accordance with the New Memorandum and Articles
of Association (as amended from time to time) and the laws of the Cayman Islands andSingapore.

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LETTER TO SHAREHOLDERS
No inference shall or can be made from any of the foregoing statements as to the actual
future profitability of the Enlarged Group or its ability to pay dividends in the future. Therecan be no assurance that dividends will be paid in the future or of the amount or timing ofany dividends that will be paid in the future.
29.

MATERIAL CONTRACTS
The following contracts, not being contracts entered into in the ordinary course of business,have been entered into by the Enlarged Group within the two years preceding the date ofthis Circular and are or may be material:29.1 The Target Company
Share Exchange Agreement
On 7 November 2023, the Target Company, its shareholders and the 17LIVE Warrant
Holders entered into a share exchange agreement with the Vendor19 (the “Share Exchange
Agreement”), pursuant to which (i) the 17LIVE Warrants were exercised for the applicable
preference shares in the Target Company and the 17LIVE Warrant Holders became theshareholders of the Target Company; and (ii) the shareholders of the Target Company(including the 17LIVE Warrant Holders after the exercise of the 17LIVE Warrants)
transferred their respective shares in the Target Company to the Vendor, in consideration
for the issue and allotment of shares by 17LIVE Holdco to them, in proportion to their
existing shareholding in the Target Company (the “Share Exchange”). Upon the completionof the Share Exchange, the shareholders of the Target Company shall become
shareholders of the Vendor and the Target Company shall become a subsidiary of the
Vendor.

19

The parties to the Share Exchange Agreement are 17LIVE Holdco, the Target Company, Vertex Legacy Continuation
Fund Pte. Ltd., Vertex Ventures SEA Fund III Pte. Ltd., M17 Growth SPV B LLC, Talent Dragon Co., Ltd., Chia Nine
Investment Co., Ltd., Dragon Alexander Limited, Infinity e.Ventures Asia III, L.P., IVP Annex I LLC, KTB China Synergy
Fund, Northpark Advisory Ltd., Pav Investments Pte. Ltd, TWM Venture Co, Ltd., M17 Growth SPV LLC, Vertex
Growth Fund Pte. Ltd., Honeymelon Group Pte. Ltd., MCN Investments Ltd, Global Grand Leisure Pte. Ltd, Majuven
Fund 1 Ltd, Majuven Fund 2 L.P., Convergence Capital 1 Holdings Ltd, Pelago Holdings, YJ2 Investment Partnership,
Jing Shen Ng, Golden Summit International Ltd, Leadway Asia Pacific Limited, Down Holdings LLC, Liu, Qin, Global
Gateway Fund I, Abico Asia Capital Corporation, Phua Angela, Mr. Liu, Po-Yuan, Plutus Ventures Limited, PT Senjaya
Tunggal Sakti, Mr. Wong, Ta Wei, AppWorks Ventures II Limited, AppWorks Fund II Co., Ltd., Lim Ho Kee, Tong Aika,
Chung Yuk Yin Barnabas, Lee Ching Yen Stephen, Prince Bernhard of Baden, Danchelle Limited, Khenglian Ho, AL
BWF Fund, K2 Global, L. P., Sowing Seeds Fund LP, Foo Chuan Tay, Cascade Bliss Limited, Mercy House Inc., Jo
Hirao, Stonebridge Young Frontier Fund, Blackpearl Secondary Fund I, Innovation Engine, Inc., Innovation Engine
Industry Creation Investment Limited Partnership, Innovation Engine LIVESTREAM Limited Liability Partnership,
Mirae Asset Innovative Growth Fund, Mirae Asset Next Korea AI Venture Investment, Jain-Yue Chen, Jae Yoon
Chong, Chun-Min Chung, Yen-Yu Lin, Yen-Shuan Lin, Yen-Tsen Lin, Ho-Po Chan, Fu-Yu Hsieh, Ginny Tsai, Chi-Mei
Chiu, GSR Ventures V (Singapore) Pte. Ltd., GSR Frontier Ventures, L.P., Mayfield XIV, a Cayman Islands Exempted
Limited Partnership, Signia Venture Partners II, L.P., Signia Principals Fund II, L.P., Sycamore II Holdings Limited,
United Faith Investment, Ltd., Tong Sui Bau, Big Timber Holdings LLC, Stonebridge Korea Unicorn Venture Fund,
Kaga Electronics Co., Ltd and Innoven Capital Singapore Pte. Ltd.

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LETTER TO SHAREHOLDERS
Target Shareholders’ Agreement
On 4 April 2023, the Target Company entered into an amended and restated shareholders’agreement20 (the “Target Shareholders’ Agreement”) with the founders and the holders ofseries AA preference shares, series A preference shares, series B preference shares,series C preference shares and series D preference shares of the Target Company, in
relation to the rights and obligations of the Target Company and the aforementioned
shareholders of. The Target Shareholders’ Agreement was negotiated by the parties named
therein on an arm’s length basis. The Target Shareholders’ Agreement will be terminatedupon Completion.
29.2 The Company
Sale and Purchase Agreement
The Company has entered into a sale and purchase agreement with the Vendor, the Target
Company, the Management Warrantors and the Founder on 2 October 2023 (“Sale andPurchase Agreement”), pursuant to which the Vendor has agreed to sell to the Company,
and the Company has agreed to purchase from the Vendor, 269,393,579 shares in theTarget Company (“Sale Shares”), comprising 100% of the issued and paid-up share capitalof the Target Company, by way of the Proposed Business Combination on the terms andsubject to the conditions set out in the Sale and Purchase Agreement.
Pursuant to the Sale and Purchase Agreement, the aggregate consideration for the Sale
Shares shall comprise (a) the allotment and issuance of the Consideration Shares to the
Vendor (or if the Vendor so nominates, to the Vendor Shareholders) on the Completion Dateand (b) subject to the satisfaction of the Financial Targets for Earnout, the allotment andissuance of the Earnout Shares to the Earnout Shareholders on each applicable Earnout
Vesting Date. In addition, subject to the Financial Targets for EIS achieved, the Purchaser
shall allot and issue the EIS Shares to each of the Key Executives pursuant to the terms of
the EIS on each applicable EIS Vesting Date.
The Sale and Purchase Agreement may be terminated at any time prior to the Completion
Date if, among others, any governmental order is enacted which has the effect of making
consummation of the Proposed Business Combination illegal or if Shareholders’ approval
for the Proposed Business Combination is not obtained at the EGM.

20

The parties to the Target Shareholders’ Agreement are the Target Company, Joseph Phua, Jing Shen Ng, Vertex
Legacy Continuation Fund Pte. Ltd., Vertex Ventures SEA Fund III Pte. Ltd., M17 Growth SPV B LLC, Talent DragonCo., Ltd., Chia Nine Investment Co., Ltd., Dragon Alexander Limited, Infinity e.Ventures Asia III, L.P., IVP Annex I LLC,
KTB China Synergy Fund, Northpark Advisory Ltd., Pav Investments Pte. Ltd, TWM Venture Co, Ltd., M17 Growth
SPV LLC, Vertex Growth Fund Pte. Ltd., Honeymelon Group Pte. Ltd., MCN Investments Ltd, Global Grand LeisurePte. Ltd, Majuven Fund 1 Ltd, Majuven Fund 2 L.P., Convergence Capital 1 Holdings Ltd, Pelago Holdings, YJ2
Investment Partnership, Golden Summit International Ltd, Leadway Asia Pacific Limited, Liu, Qin, Global Gateway
Fund I, Abico Asia Capital Corporation, Phua Angela, Mr. Liu, Po-Yuan, Plutus Ventures Limited, PT Senjaya Tunggal
Sakti, Mr. Wong, Ta Wei, AppWorks Ventures II Limited, AppWorks Fund II Co., Ltd., Lim Ho Kee, Chung Yuk Yin
Barnabas, Lee Ching Yen Stephen, Prince Bernhard of Baden, Danchelle Limited, Khenglian Ho, AL BWF Fund, K2
Global, L. P., Sowing Seeds Fund LP, Foo Chuan Tay, Cascade Bliss Limited, Mercy House Inc., Jo Hirao, Stonebridge
Young Frontier Fund, Blackpearl Secondary Fund I, Innovation Engine, Inc., Innovation Engine Industry Creation
Investment Limited Partnership, Innovation Engine LIVESTREAM Limited Liability Partnership, Mirae Asset
Innovative Growth Fund, Mirae Asset Next Korea AI Venture Investment, GSR Ventures V (Singapore) Pte. Ltd., GSR
Frontier Ventures, L.P., Mayfield XIV, a Cayman Islands Exempted Limited Partnership, Signia Venture Partners II,
L.P., Signia Principals Fund II, L.P., Sycamore II Holdings Limited, United Faith Investment, Ltd., Tong Sui Bau, Big
Timber Holdings LLC, Stonebridge Korea Unicorn Venture Fund and Kaga Electronics Co., Ltd.

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LETTER TO SHAREHOLDERSManagement and Placement Agreement
The Company has entered into a management and placement agreement with DBS andUBS on 9 November 2023 (“Management and Placement Agreement”), pursuant to which
the Company and the Target Company confirmed the appointment of DBS and UBS as the
Joint Financial Advisers to the Proposed Business Combination and as Joint Placement
Agents to the PIPE Financing. Subject to the terms and conditions of the Management andPlacement Agreement, the Joint Financial Advisers shall use their best efforts to procure
subscriptions for the Base PIPE Shares at the Issue Price for each Base PIPE Share.
The Company and the Target Company have agreed in the Management and Placement
Agreement to indemnify the Joint Placement Agents against certain liabilities.
The Management and Placement Agreement may be terminated by the Joint Financial
Advisers, following consultation with the Company and the Target Company, upon theoccurrence of certain events prior to the Completion Date, including, among others, if any
statement contained in this Circular or materials used in the marketing of the PIPE
Financing become untrue, incorrect or misleading in any material respect, or if there shallhave been any events which would be likely to have a material adverse effect on thebusiness, trading position, operations or prospects of the Company or the Target Group.
The Company will pay the Joint Financial Advisers, as compensation for their services inconnection with the Proposed Business Combination and the PIPE Financing, certain
business combination fees and PIPE Financing fees. In addition, pursuant to the terms ofthe management and underwriting agreement that was entered into between the Company,
the Sponsor, Vertex SPV, CS, DBS and Morgan Stanley Asia (Singapore) Pte. dated
13 January 2022 (the “MUA”), the Company will, subject to the terms and conditions
specified in the MUA, pay the Deferred Fee (as defined in the MUA) to the Joint Financial
Advisers, who shall, subject to the terms and conditions specified in the MUA, be entitled
to receive their respective proportion of the Deferred Fee within 10 Business Days following
Completion.
Deed of Waiver
The Sponsor has entered into a deed of waiver in favour of the Company on 9 November
2023 (“Deed of Waiver”), pursuant to which the Sponsor agrees to waive its rights to theallotment and issuance of a certain number of Promote Shares on the terms of the Deed of
Waiver to show support for the Company’s Special Bonus Scheme and Executive Incentive
Scheme which are proposed to be adopted in connection with the Proposed Business
Combination and to minimise the dilution that will arise from the allotment and issuance of
new Shares pursuant to such schemes.
Subject to and conditional upon the allotment and issuance of the Special Bonus Sharesand the EIS Shares by the Company:(a)the Sponsor agrees to waive its rights to the allotment and issuance of such numberof Promote Shares which shall be equivalent, in aggregate, to the number of Special
Bonus Shares and EIS Shares allotted and issued by the Company, being not morethan 6,310,600 Promote Shares (the “Waived Promote Shares”);

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LETTER TO SHAREHOLDERS(b)

the Company shall, within 14 days from the Completion Date, inform the Sponsor inwriting of the number of Special Bonus Shares allotted and issued to the
Non-Redeeming Shareholders for every existing Share held by the Non-Redeeming
Shareholders as at the Redemption Record Date and to the PIPE Investors(the “Actual Special Bonus Shares”), and upon the receipt of such notice, theSponsor agrees to waive its rights to the allotment and issuance of such number ofPromote Shares equivalent to the Actual Special Bonus Shares;(c)in relation to the EIS Shares, the Company shall, within 14 days from each EIS Vesting
Date, inform the Sponsor in writing of the number of EIS Shares allotted and issued
to the Key Executives (each being referred to as the “Allotted EIS Shares” at each
EIS Vesting Date), and upon the receipt of such notice, the Sponsor agrees to waive
its rights to the allotment and issuance of such number of Promote Shares equivalent
to the Allotted EIS Shares at each EIS Vesting Date;(d)the Company shall, within 14 days from the date of the final EIS Vesting Date, being
30 April 2026, inform the Sponsor in writing of the Final Adjusted Maximum Promote
Shares which the Sponsor is entitled to;(e)the Company and the Sponsor agree that, assuming the vesting conditions in Clause
2.4 of the Promote Shares Deed of Undertaking are fulfilled, the Sponsor shall waive
its rights over the Waived Promote Shares sequentially from its rights under Clause
2.4(d) of the Promote Shares Deed of Undertaking, followed by Clause 2.4(c) of thePromote Shares Deed of Undertaking, followed by Clause 2.4(b) of the Promote
Shares Deed of Undertaking and, where applicable, followed by Clause 2.4(a) of thePromote Shares Deed of Undertaking provided that (i) prior to 30 April 2026, theSponsor shall be entitled to be allotted and issued up to the Initial Adjusted Maximum
Promote Shares; and (ii) after 30 April 2026, the Sponsor shall be entitled to be allotted
and issued up to the Final Adjusted Maximum Promote Shares (including the Promote
Shares already allotted and issued pursuant to sub-paragraph (i) above); and(f)in relation to the Promote Shares which have not yet vested but have not been waived
by the Sponsor in the Deed of Waiver, the Company and the Sponsor confirm that theterms of the Promote Shares Deed of Undertaking remain valid and binding and theremaining Promote Shares will be subject to the vesting conditions set out in Clause
2 of the Promote Shares Deed of Undertaking.

Administrative Services Agreement
The Company has entered into an administrative services agreement (the “Administrative
Services Agreement”) with VVMPL, a wholly-owned subsidiary of the Sponsor, on
6 January 2022. The Administrative Services Agreement came into effect on 6 January2022 and shall continue in force unless terminated with the prior agreement of each party
in writing. In addition to the foregoing, the Administrative Services Agreement shall be
immediately terminated upon the earlier of: (i) any material breach by VVMPL, unless in the
Company’s absolute discretion, the Company provides a period for VVMPL to remedy thebreach (the “Remedy Period”), in which event the Administrative Services Agreement shallterminate at the end of the Remedy Period if the VVMPL has not, by the end of the Remedy
Period, cured the breach to the Company’s satisfaction; (ii) the Company committing any
material breach of its obligations under the Administrative Services Agreement and (if suchbreach is capable of remedy) has failed to make good such breach within 30 days of noticebeing served on it by requiring it to make good such breach; (iii) the Company filing for
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LETTER TO SHAREHOLDERS
bankruptcy, becoming insolvent, or making an assignment for the benefit of creditors; (iv)
VVMPL undergoing a change in ownership or becoming insolvent, or going into liquidation,
receivership or judicial management; or (v) the end of the term of the Administrative
Services Agreement pursuant to or where required by applicable laws.
Pursuant to the terms of the Administrative Services Agreement, VVMPL will provide to theCompany, among others, (a) legal and regulatory compliance support; (b) support services
in sourcing and evaluating suitable target companies for the initial business combination(which includes research on and analysis of: (i) potential targets identified by the Company;(ii) the industry/market in respect of the potential targets identified by the Company; and (iii)the competitive landscape in relation to (i) and (ii)); (c) general administration services inrelation to the Company’s business operations, such as corporate administration, financeand accounting services, human resources and payroll support, information systems
management and maintenance, end-user support, local area networks management, help
desks, information technology security operations, business continuity planning andrecord-keeping; (d) assistance with coming up with and implementing suitable risk
management policies and monitoring, assessing and managing risk in accordance withsuch policies on an on-going basis; and (e) making available office space to the Company(collectively, the “Support Services”). In addition, VVMPL will also second two employees,
namely Mr. Jiang Honghui and Mr. Sito Tuck Wai, to perform the roles of the Company’s
CEO and CFO on a full-time and part-time basis respectively (collectively, the“Secondment”).
During the term of the Administrative Services Agreement, the Company will pay VVMPL anannual fee of S$100,000 and S$200,000 for the Support Services and the Secondment
respectively (the “Service Fees”). In particular, the annual fee for the Support Services is
a notional amount charged by VVMPL and is therefore not on normal commercial terms orcomparable to fees that the Company would otherwise pay to other services providers of asimilar standing if they were to provide similar services to the Company and the annual fee
for the Secondment is based on an estimation of approximately 25% of the aggregateannual remuneration of the relevant persons being seconded. The Service Fees shall bepayable quarterly in advance in four equal instalments per annum and pro-rated accordingly
for any partial calendar quarter.
The Service Fees will be paid through the gross proceeds raised from the Company’s
issuance and allotment of the Private Placement Warrants pursuant to the Private
Placement Warrants Purchase Agreement. For the avoidance of doubt, the payment of such
Service Fees will not reduce the amounts available to be returned or distributed toShareholders in the event an initial business combination is not consummated.
Promote Shares Deed of Undertaking
As a reward and an incentive for the execution of a successful initial business combination,
the Company has entered into the Promote Shares Deed of Undertaking, pursuant to which
the Company undertakes to allot and issue up to 10.0 million Shares (or up to 10.59 million
Shares, if the Over-allotment Option is exercised in full) for a nominal consideration of
S$25,000 (the “Promote Shares”) following the completion of the initial businesscombination in favour of Vertex SPV, such Promote Shares (a) to be vested over a certain
period subject to certain terms and conditions; and (b) to constitute no less than 20% of theissued and paid-up share capital of the Company on a fully diluted basis immediately
following the completion of the Offering. Similar to market practice in the U.S., the Company
will issue the Promote Shares to Vertex SPV for S$25,000. The consideration for the346

LETTER TO SHAREHOLDERS
Promote Shares will be pro-rated based on the amount of Promote Shares vested, allotted
and issued as at the relevant vesting dates. For the avoidance of doubt, the Promote
Shares that will be vested, allotted and issued to Vertex SPV do not carry with them
entitlement to any of the Warrants. For the avoidance of doubt, the consideration for the
Promote Shares will be capped at S$25,000 even if the Over-allotment Option is exercisedin full.
Pursuant to the terms of the Promote Shares Deed of Undertaking, the number of Promote
Shares to be allotted and issued to Vertex SPV is subject to an adjustment in the event theOver-allotment Option is exercised in full. For the avoidance of doubt, the adjusted numberof Promote Shares will not in any event exceed 10.59 million Shares.
In the event that the Over-allotment Option is exercised (in part or in full), the number ofPromote Shares that will be issuable by the Company to Vertex SPV pursuant to thePromote Shares Deed of Undertaking will be adjusted such that the total number ofPromote Shares issuable will always be 20% of the total issued share capital of theCompany following the exercise of the Over-allotment Option, assuming that all the
Promote Shares are issued.
The Company shall within 30 Market Days of the Listing Date send a written notice to theSponsor and Vertex SPV to inform the Sponsor and Vertex SPV of the number of Promote
Shares that Vertex SPV shall initially be allotted and issued following the exercise of theOver-allotment Option pursuant to the Promote Shares Deed of Undertaking.
Assuming the Over-allotment Option is not exercised, the number of Promote Shares will be
10.0 million. Assuming the Over-allotment Option is exercised in full, the number ofPromote Shares will be 10.59 million. The Promote Shares will vest, and be allotted andissued in favour of Vertex SPV based on the following schedule:(a)49.0% of the Promote Shares (rounded down to the nearest whole number) on thedate falling 12 months after the completion (as defined below) of the initial businesscombination;(b)

17.0% of the Promote Shares (rounded down to the nearest whole number) on thedate during the 10 calendar years following the date of completion (as defined below)of the initial business combination upon the Return to Shareholders (as defined below)
exceeding 20%;(c)

17.0% of the Promote Shares (rounded down to the nearest whole number) on thedate during the 10 calendar years following the date of completion (as defined below)of the initial business combination upon the Return to Shareholders (as defined below)
exceeding 40%; and(d)17.0% of the Promote Shares (rounded down to the nearest whole number) on thedate during the 10 calendar years following the date of completion (as defined below)of the initial business combination upon the Return to Shareholders (as defined below)
exceeding 60%.

“completion” referred to herein shall mean the completion of transfer of ownership of thebusiness or asset to be acquired pursuant to the initial business combination, which shalloccur on or before the listing date of the Resulting Issuer. “Return to Shareholders” means
the sum of (i) the appreciation of the per-Share trading price of the Shares following the347

LETTER TO SHAREHOLDERS
initial business combination (measured as the excess above the Reference Price of theaverage of the 20 highest daily closing market prices for such Shares over any period of
30-Market Day period that commences after the completion of the initial businesscombination) and (ii) the cash or fair market value (as applicable) of each dividend or
distribution that has been declared and paid by the Company on the Shares (measured ona per-Share basis as of the date such dividend or distribution was declared) following theinitial business combination, with such sum expressed as a percentage of the Reference
Price. “Reference Price” referred to herein shall, following the completion of the Offeringand Listing, mean S$5.00, and shall be adjusted proportionately to account for any changes
in the Company’s equity securities by way of rights issue, sub-division of Shares,
combination or reclassification or through merger, consolidation, reorganisation,
recapitalisation or initial business combination or by any other means where the Company
shall appoint an Independent Financial Adviser to consider whether any adjustment to theprevailing Reference Price is appropriate and has been proportionately adjusted and if such
Independent Financial Adviser shall determine that any adjustment is appropriate, theReference Price shall be adjusted accordingly. For the purposes of this paragraph,“Independent Financial Adviser” shall mean an independent financial institution
appointed by the Company at its own expense, provided always that the Independent
Financial Adviser shall not also be the auditors of the Company for the time being. Wherean adjustment is made to the Reference Price, the Company will make an SGXNET
announcement as soon as practicable disclosing details in relation to such adjustment andthe bases for the Independent Financial Adviser’s view on whether such adjustment isappropriate. For the purposes of this section titled “Material Contracts – Promote Shares
Deed of Undertaking” only, “Over-allotment Option” has the meaning ascribed to it in the
Prospectus.
If after the date of Listing, the number of issued and outstanding Shares is varied, by wayof a sub-division, a bonus issue, a consolidation, a combination or other similar event, thenumber of Promote Shares which have not yet vested shall be adjusted proportionately
accordingly in the same proportion as the adjustment to the Shares, given that the events
for this adjustment relate to pro-rata adjustments which apply to all ordinary sharesproportionately. Such adjustments will need to be approved by the Board by way ofresolutions passed at a Board meeting or by unanimous written resolution (in the absenceof a Board meeting).
The Sponsor has undertaken to the Company pursuant to the Promote Shares Deed ofUndertaking in relation to any Promote Shares which vest and are issued within 12 months
from the completion of the initial business combination (the “Lock-up Promote Shares”)
not to, and has undertaken to procure Vertex SPV not to, directly or indirectly, without theprior written consent of the Company:(a)offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchaseany option or contract to sell, grant any option, right or warrant to purchase, lend,
hypothecate, grant security over, encumber or otherwise transfer or dispose of its
holdings in any Lock-up Promote Shares (or any securities convertible into or
exercisable or exchangeable for or which carry rights to subscribe for or purchase anyof Lock-up Promote Shares) or enter into a transaction that would have the same
effect, whether any such transaction described above is to be settled by delivery of the
Lock-up Promote Shares or such other securities, in cash or otherwise;348

LETTER TO SHAREHOLDERS(b)enter into any swap, hedge or other transaction or arrangement (including a derivativetransaction) that transfers to another, in whole or in part, any of the economic
consequences of ownership of the Lock-up Promote Shares (or any securities
convertible into or exercisable or exchangeable for or which carry rights to subscribe
for or purchase any of the Lock-up Promote Shares), whether any such transaction
described above is to be settled by delivery of the Lock-up Promote Shares or suchother securities, in cash or otherwise;(c)deposit any of the Lock-up Promote Shares or any securities convertible into or
exchangeable for or which carry rights to subscribe for or purchase any of the Lock-up
Promote Shares in any depository receipt facilities (other than in a CDP designatedmoratorium account for the purposes of complying with its obligations under its
undertaking), whether any such transaction described above is to be settled bydelivery of the Lock-up Promote Shares or such other securities, in cash or otherwise;(d)enter into any transaction which is designed or which may reasonably be expected toresult in any of the above; or(e)announce or publicly disclose any intention to do any of the above,from the date of the completion of the initial business combination up until the date falling
12 months after the completion of the initial business combination.
Separately, the Sponsor and Vertex SPV have also provided certain undertakings pursuant
to a lock-up arrangement with the Joint Global Coordinators, Joint Bookrunners and Joint
Underwriters (each as defined in the Prospectus) in relation to the Lock-up Promote
Shares. Please refer to the section titled “Plan of Distribution – No Sale of Similar Securities
and Lock-up” of the Prospectus for further details. For the avoidance of doubt, the Promote
Shares may be issued at any time within the 10-year period after the initial businesscombination so long the abovementioned Share price targets are met. If these Promote
Shares vest and are issued within 12 months from the completion of the initial businesscombination, such Promote Shares shall be locked-up for at least 12 months after thecompletion of the initial business combination.
Notwithstanding the foregoing, all of the Promote Shares will vest immediately, and will nolonger be subject to the transfer restrictions pursuant to the terms of the Promote Shares
Deed of Undertaking, upon the occurrence of any of the following:(a)if the Company is privatised pursuant to a takeover offer or scheme of arrangement;(b)

if the Shares cease to be listed and traded on SGX-ST;(c)

if the Company is, other than in connection with the initial business combination,
amalgamated, merged, consolidated or reorganised with or into another person (an“acquirer”), and as a result thereof less than 50.1% (whether by voting or economic
interests) of the outstanding equity capital interests of the acquirer, or other surviving
or resulting entity, is owned in the aggregate by those persons that were holders of the
Shares immediately prior to such amalgamation, merger, consolidation or
reorganisation, excluding from such computation any of the Shares held at such timeby the acquirer or any Associate of the acquirer;

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LETTER TO SHAREHOLDERS(d)if, other than in connection with the initial business combination, the Company or anyof its subsidiaries, individually or collectively, sells, assigns, transfers or otherwise
disposes of, in one transaction or a series of related transactions, all or substantiallyall of the assets of the Company and its subsidiaries, taken as a whole, to an acquirer,
and as a result thereof less than 50.1% (whether by voting or economic interests) of
the outstanding equity capital interests of the acquirer, or other surviving or resulting
entity, is owned in the aggregate by those persons that were holders of the Shares
immediately following such sale, assignment or transfer, excluding from suchcomputation any of the Shares held at such time by the acquirer or any Associate of
the acquirer; or(e)if, other than in connection with the initial business combination, any person or groupdiscloses that it has become the beneficial owner of a percentage of the Company’s
issued Shares greater than the percentage of such Shares that, at the date of such
filing, is held by any other person or group that held more than 50% of the Shares
immediately after the closing of the initial business combination.

The Promote Shares when allotted and issued pursuant to the Promote Shares Deed ofUndertaking shall rank pari passu with all other Shares previously issued and remain
outstanding in the Company. In addition, in the event that the initial business combination
results in the Company being reconstituted, or merged or amalgamated into or with anotherentity (the “Resulting Issuer”), the Company undertakes to ensure that Vertex SPV shallbe allotted and issued a pro rata shareholding interest in the Resulting Issuer.
Under the terms of the Promote Shares Deed of Undertaking, the Promote Shares areissued after the completion of the initial business combination. Based on the Company’s
significant accounting policies, the Company does not anticipate that there will be anything
precluding the Promote Shares from being treated as equity when issued, from an
accounting perspective.
Based on the Over-allotment Option exercised, the Company shall allot and issue
10,401,500 Shares to Vertex SPV subject to the vesting conditions set out above and in the
Promote Shares Deed of Undertaking.
Escrow Agreement
The Company has entered into an escrow agreement with the Escrow Agent on 6 January2022 (the “Escrow Agreement”). The Escrow Agent is independent of the Sponsor, theManagement Team and their respective Associates. The Escrow Agreement is governed bySingapore law and pursuant to the terms of the Escrow Agreement, the Escrow Agent isrequired to disclose any confidential or other information to the SGX-ST upon request. The
Escrow Agent is also required to take appropriate measures to ensure proper safekeeping,custody and control of the funds held in the Escrow Account, including that properaccounting records and other related records as necessary are retained in relation to the
Escrow Account. The Escrow Agent will charge certain administrative costs depending on
investments of the escrowed accounts made by the Company, with such costs deductedfrom the interest income accrued or the proceeds from the issuance of the Private
Placement Warrants.

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LETTER TO SHAREHOLDERS
Pursuant to the terms of the Escrow Agreement, at any time during the term of the Escrow
Agreement, the Company may invest any escrowed amount into any cash equivalent
short-dated securities of at least A-2 rating (or an equivalent) or such other investment as
may be permitted under the Listing Manual, as well as any time deposit offered by the
Escrow Agent, subject always to the applicable provisions of the Listing Manual. In addition,in accordance with applicable provisions of the Listing Manual, the Escrow Account shall beterminated and the escrowed amounts released: (a) if the Company completes an initialbusiness combination within the business combination deadline, (i) on a pro rata basis to
Shareholders who exercise their Redemption Right in accordance with Rule 210(11)(m)(x)of the Listing Manual (as supplemented or amended from time to time), (ii) the deferredunderwriting commissions due to each of the Joint Global Coordinators, Joint Bookrunners
and Joint Underwriters (each as defined in the Prospectus) in connection with the Offering,and (iii) the balance amount to the Company; and (b) in the event of the Company’s
liquidation as required by the applicable provisions of the Listing Manual, to Shareholders(including the Sponsor, the Management Team and their respective Associates in respectof all equity securities (being Units, comprising Shares and Warrants) owned or acquired bythem prior to or pursuant to the Offering at the Offering Price or, as the case may be, anyof such equity securities purchased or acquired by the Sponsor, in accordance with Rule210(11)(n)(i) to (iv) of the Listing Manual (as supplemented or amended from time to time).
Prior to release of the escrowed amounts in accordance with the terms of the Escrow
Agreement and the Listing Manual, only interest earned and income derived from theescrowed amounts may be drawn down by the Company from the Escrow Account for
purposes permitted by paragraph 6.1(c) of Practice Note 6.4 of the Listing Manual(as supplemented or amended from time to time).
The Escrow Agent may at any time resign for any reason by giving three months’ priorwritten notice (a “Resignation Notice”) to such effect and stating its reasons for resignation
to the Company and the SGX-ST. On receipt of a Resignation Notice from the Escrow
Agent, the Company shall appoint a successor escrow agent as soon as reasonably
possible and in any event within two months of the Resignation Notice and give (a) written
notice to such effect and (b) details of such replacement including the account details ofsuch replacement to the Escrow Agent. In addition, the Company may at any time replace
the Escrow Agent by giving (a) written notice (a “Termination Notice”) to such effect, and(b) details of such replacement including the account details of such replacement to the
Escrow Agent, provided always that the Company shall not deliver a Termination Notice
until it has given three months’ prior written notice to the SGX-ST of its intention toterminate the Escrow Agent’s appointment, stating its reasons for termination. Any
termination or replacement of or resignation by the Escrow Agent is subject to theapplicable provisions of the Listing Manual, including that escrow arrangement(s) must be
secured and maintained at all times over the escrowed amounts until termination of theEscrow Account in accordance with the Listing Manual and the escrow agent must be afinancial institution licence and approved by the Authority and independent of the Sponsor,
the Management Team and their respective Associates. The Company is required to
immediately announce via SGXNET such change of Escrow Agent pursuant to Rule754(2)(a) of the Listing Manual.

351

LETTER TO SHAREHOLDERSThe Company will implement cash control management processes to ensure that only
permitted amounts may be properly drawn down or disbursed from the Escrow Account. In
particular, the Company will observe the following procedures in sequence prior to any
disbursements from the Escrow Account in accordance with the terms of the Escrow
Agreement:(a)verification by the CFO of all necessary supporting documentation for a disbursementfrom the Escrow Account;(b)passing of a Board resolution to appoint two independent directors to co-sign therelevant payment instruction together with the Company’s Non-Executive Chairman or
an Executive Officer;(c)providing the Escrow Agent with the abovementioned payment instruction at least
three clear Business Days before the date of disbursement; and(d)attending to the verification by the Escrow Agent by way of a “callback” procedure(where such person attending to the “callback” verification cannot be the same party
executing the payment instruction).

Warrant Agreement
Pursuant to the Warrant Agreement, the Warrant Agent will act on behalf of the Company
in connection with the issuance, registration, transfer, exchange, redemption and exerciseof the Warrants. Please refer to the section titled “Appendix E – Terms and Conditions of
the Warrants” of the Prospectus for more details on the Warrant Conditions.
The Warrant Exercise Price is in line with the market practice in the context of the initialpublic offerings of U.S. SPACs where the exercise price of warrants issued is typically
US$11.50 (or at a 15% premium to the typical offering price of US$10.00). Given that theOffering Price per Unit is S$5.00, the Warrant Exercise Price has been adjusted
proportionately.
The proposed structure of the Offering Unit, comprising one Share and up to one half of one
Warrant, is a common commercial structure for U.S. SPAC offerings. The maximum dilution
to the Company’s post-invitation share capital following the conversion of such Warrants
will be approximately 44.4% and not be more than 50.0% of the Company’s post-invitation
share capital (on a fully diluted basis). In respect of the one half of one Warrant, 0.3 of one
Warrant per Share will be issued at the completion of the Offering, with an additional rightto the Additional Warrants which will only be issued later to holders of Shares (which havenot been tendered for Redemption) at or around the completion of the initial businesscombination. Such Additional Warrants is expected to be credited into the Securities
Accounts of the relevant Shareholders after the initial business combination. Persons who
do not hold any Shares will not be entitled to the Additional Warrants. This seeks toincentivise Shareholders to elect not to redeem their Shares at the time of the initialbusiness combination and stay vested in the longer-term prospects of the Resulting Issuer.
In the event there are redemptions of Shares upon the initial business combination, thelapsing of the Additional Warrants is also intended to mitigate the overall dilutive effect fromthe issue of the Warrants upon the initial business combination. The Additional Warrants
would be extinguished in respect of each Share in which the holder of the Shares elects toredeem.

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LETTER TO SHAREHOLDERS
In addition, to further minimise the impact of dilution to independent Shareholders (i.e.
Shareholders other than the Sponsor, the Management Team and their respective
Associates), the terms of the Warrants include a redemption right, exercisable by theCompany when the Reference Value equals or exceeds S$9.00 per Share (subject toadjustment in compliance with the Warrant Conditions). The Private Placement Warrants
may similarly be settled on a “cashless basis” during the Warrant Exercise Period. The
cashless settlement of the Warrants reduces the dilutive impact of the Warrants as it allows
the Company to settle a Warrant by issuing less Shares.
The Shares and Warrants have been separately traded as separate counters from the 45th
calendar day from the Listing Date.
The entitlement to the Additional Warrants will be accorded only to holders of the Shares inrespect of Shares which are not tendered for Redemption upon the initial businesscombination.
Pursuant to the Warrant Conditions, any new securities issued in connection with the initialbusiness combination (other than as a result of a sub-division or consolidation of sharecapital) will result in adjustments to the exercise price of the Warrants, if (a) the effective
price of such new securities is less than S$4.60 per Share (“Newly Issued Price”), (b) the
aggregate gross proceeds raised from such issuances represent more than 60% of the total
equity proceeds (and interests thereon) available for funding of the initial businesscombination on the date of completion of the initial business combination (net ofredemptions) and (c) the volume weighted average trading price of the Shares during the
20 Market Day period starting on the Market Day prior to the day on which the Company
consummates the initial business combination (such price, the “Market Value”) is below
S$4.60 per Share. In which case, pursuant to the Warrant Conditions, (i) the Warrant
Exercise Price shall be adjusted (to the nearest cent) to be equal to 115% of the higher ofthe Market Value and the Newly Issued Price and (ii) the S$9.00 per Share redemption
trigger price described in the Warrant Conditions hereof shall be adjusted (to the nearestcent) to be equal to 180%, respectively, of the higher of the Market Value and the Newly
Issued Price. As such, the additional capital raising event is unlikely to affect the number ofWarrants at the completion of the initial business combination.
Private Placement Warrants Purchase Agreement
Concurrent with the Offering, as part of the at-risk capital contribution from Vertex, Vertex
has entered into the Private Placement Warrants Purchase Agreement with the Company,
pursuant to which Vertex shall procure Vertex SPV to subscribe for an aggregate of up to
20.0 million Warrants (the “Private Placement Warrants”), wherein 16.0 million Private
Placement Warrants will be issued on the close of the Offering and up to a further 4.0 million
Private Placement Warrants may be issued in one or more tranches at any time during theperiod commencing the date of the close of the Offering to the date of the initial businesscombination (such issuance(s) which may occur in one or more tranches to be announced
on SGXNET), at a consideration of S$0.50 per Private Placement Warrant. Each Private
Placement Warrant entitles Vertex SPV to subscribe for one Share based on the exercise
price of S$5.75 per Share, subject to adjustment. The Private Placement Warrants are
identical to the Warrants included in the Units sold in this Offering, subject to certain limited
exceptions as described in the section titled “Proposed Business – Material Contracts –Warrant Agreement – Differences between the Private Placement Warrants and the Public
Warrants” of the Prospectus.

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LETTER TO SHAREHOLDERS
Pursuant to the terms of the Private Placement Warrants Purchase Agreement, each
Private Placement Warrant shall have the terms set forth in the Warrant Agreement exceptthat the Private Placement Warrants will be non-redeemable so long they are held by Vertex
SPV (or any of its Permitted Transferees), and may be exercisable on a “cashless basis” ifheld by Vertex SPV or its Permitted Transferees, as further described in the Warrant
Agreement.
The Sponsor’s purchase of the Private Placement Warrants through Vertex SPV
demonstrates the Sponsor’s commitment and ensures sufficient alignment of interests with
the Shareholders. In particular, given the Private Placement Warrants would only be ofvalue when in-the-money, the Sponsor is incentivised to deliver results to Shareholders andwork towards a successful initial business combination.
As at the Latest Practicable Date, the number of Private Placement Warrants purchased is16.0 million and to the best of the knowledge of the Company and subject to Completion,no additional Private Placement Warrants are intended to be purchased by Vertex SPV.
30.

MATERIAL LITIGATIONThe Target Group is not, and has not been, engaged in any legal or arbitration proceedings,
including those which are pending or known to be contemplated, which may have or have
had during the last 12 months before the date of this Circular, a material effect on the Target
Group’s financial position or profitability.

31.

EXCHANGE CONTROL AND TAXATION

31.1 Exchange Control
Japan
Pursuant to the FEFTA, dividends paid on, and the proceeds from sales of shares held byexchange non-residents of Japan may generally be converted into any foreign currency andrepatriated abroad.
Exchange non-residents are defined in the Foreign Exchange Regulations as (i) individuals
who do not reside in Japan; or (ii) corporations whose principal offices are located outside
Japan. As dividends paid on shares held by exchange non-residents may generally beconverted into any foreign currency and repatriated abroad, such regulations are notexpected to have a material impact on the availability of cash and cash equivalents for use
by the Target Company.
TaiwanForeign exchange matters are generally governed by the Foreign Exchange Regulation Act,
which was last amended on 29 April 2009, and regulated by the Ministry of Finance of
Taiwan and the Taiwan Central Bank. The Taiwan Central Bank promulgated theRegulations Governing the Declaration of Foreign Exchange Receipts and Disbursementsor Transactions effective from 26 December 2022, which regulate the declaration of foreignexchange receipts, disbursements or transactions involving not less than NT$500,000 or its
equivalent in foreign currency.

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LETTER TO SHAREHOLDERS
Pursuant to the Regulations Governing the Declaration of Foreign Exchange Receipts andDisbursements or Transactions, foreign exchange must be approved by the Taiwan Central
Bank on a payment-by-payment basis. A single remittance by a Taiwan company with anamount exceeding US$1 million must be reported to the Taiwan Central Bank withsupporting documents, and remittances by a company with an annual aggregate amount offoreign exchange purchased or sold exceeding US$50 million may not be processed
without the approval of the Taiwan Central Bank.
In respect of the dividends distributed by the Taiwan companies to 17LIVE Japan, reportingto the Taiwan Central Bank or approval from the Taiwan Central Bank is required forconverting the dividends from New Taiwan Dollars to other currencies.
Singapore
As of the date of this Circular, there are no exchange control restrictions in effect inSingapore.
Cayman Islands
As of the date of this Circular, there are no exchange control restrictions in effect under thecurrently applicable laws in the Cayman Islands.
31.2 Taxation
The summary below of certain taxes in Japan, Taiwan and Singapore are of a generalnature. The summary is based on laws, regulations, interpretations, rulings and decisions
in effect as of the Latest Practicable Date. These laws, regulations, interpretations, rulingsand decisions, however, may change at any time, and any change could be retrospective.
These laws and regulations are also subject to various interpretations and the relevant tax
authorities or the courts could later disagree with the comments herein.
The summary is not intended to constitute a complete analysis of the taxes mentioned. It
is not intended to be and does not constitute legal or tax advice.
Shareholders should consult their own tax advisers regarding taxation and otherconsequences of owning and disposing of the Shares. It is emphasised that neither theTarget Group, the directors of the Target Company nor any other persons involved in this
Proposed Business Combination accepts responsibility for any tax effects or liabilities
resulting from the subscription, purchase, holding or disposal of the Shares.
Japan
Income Tax
The individual income tax rate is from 5% to 45%. Other than income tax, local tax rate inJapan is 10%. For individual shareholders, capital gains or dividend distributions received
from certain securities in Japan are generally taxed at a flat combined rate of 20.315%(i.e., 15.315% national tax + 5% inhabitant’s tax).

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LETTER TO SHAREHOLDERS
Corporations are subject to corporate tax, local corporate tax, inhabitant tax and enterprise
tax in Japan. The combined effective statutory tax rate for corporations in Japan is up to
approximately 30.6% or approximately 34.6%, depending on the size of the registeredcapital of the company.
For corporate shareholders, in relation to dividends received from another domestic
corporation, (i) if the recipient corporation owns 100% of shares of the domestic corporation
distributing the dividends, all of the dividends are excluded from gross income and, (ii) if therecipient owns more than 33.33% and less than 100% of shares of the domestic corporation
distributing the dividends, all of the dividend (excluding the interest of the debt) areexcluded from gross income. However, if the recipient corporation owns more than 5% and
up to 33.33% of shares of the domestic corporation distributing the dividends, 50% of thedividend income is includable in gross income. If the recipient corporation owns 5% or lessof the domestic corporation distributing the dividends, 80% of the dividend income isincludable in gross income.
A foreign dividend exemption system is available for Japanese companies holding aminimum interest of 25% for a period of at least six months before the date on which thedecision to distribute the dividend is made. Under certain tax treaties, the minimum holding
interest can be lower than 25%, subject to certain conditions. Under the foreign dividend
exemption, 95% of foreign dividends received in Japan are excluded from taxable income.
No credit for withholding tax or underlying tax on the foreign dividends is available.
For corporate shareholders, capital gains are not taxed separately. Instead, such gains aretreated as ordinary income to which normal tax rates apply.
Stamp Duty
Contracts for the transfer of interests in land and certain documents are subject to stamp
duty. Stamp duty in Japan is at a progressive rate and the maximum amount of stamp duty
in Japan is JPY600,000.
Estate Duty
The estate duty or inheritance tax is at a progressive rate from 10% to 55%.
Consumption Tax
In Japan, Japanese Consumption Tax (“JCT”) is levied when a business enterprisetransfers goods, provides services, or imports goods into Japan. The general rate is 10%,
however, a lower rate of 8% applies to food and beverages (excluding alcoholic beverages
and when served at dining facilities including restaurants) and to newspaper subscriptions
that meet certain criteria. Exports and certain services to non-residents are taxed at a zerorate. Specified transactions, such as sales or lease of land, sales of securities, andprovision of public services, are not subject to taxation.

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LETTER TO SHAREHOLDERS
TaiwanIncome Tax
The individual income tax rate is from 5% to 40%.
The corporate tax rate is 20%. Resident companies with taxable income of NT$120,000 orless are exempted from corporate tax. A non-resident company is taxed on income derived
from Taiwan sources. Resident companies paying service fees or royalties to foreign
entities are generally subject to 20% withholding tax.
Capital gain arising from disposal of shares in Taiwanese private company is generally not
subject to regular income tax but is generally subject to Taiwan Alternative Minimum Tax.
For Taiwanese company shareholders, the applicable tax rate is 12%. If the holding period
is 3 years or more at the time of disposal, only half of the capital gain will be subject to
Taiwan Alternative Minimum Tax. For Taiwanese individual shareholders, the applicable tax
rate is 20%.
Dividend distributed from Taiwanese companies to foreign shareholders is subject to
Taiwan dividend withholding tax at 21%, which could be reduced by applicable tax treaties.
Dividend distributed from Taiwanese companies to Taiwan domestic shareholders is
generally exempted from withholding. An additional profit retention tax of 5% is imposed on
Taiwanese companies’ current year earnings that remain undistributed by the end of thefollowing year.
Stamp Duty
The stamp duty rate in Taiwan is 0.1% for contracts for the transfer of interest in land andcontractual agreements under which one party agrees to complete a specific piece of workfor the other party for consideration. The stamp duty rate in Taiwan is 0.4% for hardcopy
receipts of cash payments. Stamp duty in Taiwan is fixed at NT$12 for written contracts topurchase and sale of goods.
Estate Duty
The estate duty ranges from 10% to 20%.
VAT
VAT is applicable to general industries, and the rate is 5%. Under the VAT system, eachseller collects output VAT from the buyer at the time of sale, deducts input VAT paid onpurchases from output VAT, and remits the balance to the tax authority.
Singapore
Income Tax
Individual Income Tax
An individual is a tax resident in Singapore in a year of assessment if, in the preceding year,
he was physically present in Singapore or exercised an employment in Singapore (otherthan as a director of a company) for 183 days or more, or if he resides in Singapore.
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LETTER TO SHAREHOLDERS
Individual taxpayers who are Singapore tax residents are subject to Singapore income tax
on income accruing in or derived from Singapore. All foreign-sourced income received in
Singapore on or after 1 January 2004 by a Singapore tax resident individual (except forincome received through a partnership in Singapore) is exempt from Singapore income tax
if the Comptroller of Income Tax in Singapore (“Comptroller”) is satisfied that the tax
exemption would be beneficial to the individual. A Singapore tax resident individual is taxed
at progressive rates ranging from 0% to 24%.
Non-resident individuals, subject to certain exceptions and conditions, are subject toSingapore income tax on non-employment income accruing in or derived from Singapore at
the rate of 24%.
Corporate Income Tax
Under the provisions of the Income Tax Act 1947 of Singapore (“SITA”), a company isregarded as a tax resident of Singapore if the control and management of its business is
exercised in Singapore. While the term “control and management” is not specifically definedin the SITA, it has generally been accepted that control and management refers to the policy
level decision-making which is normally vested in a company’s board of directors.
The Singapore taxation system is territorial in nature. Unless otherwise exempted, aSingapore tax resident company is subject to Singapore income tax on:(a)income accruing in or derived from Singapore (i.e. Singapore-sourced income); and(b)foreign-sourced income which is considered received in Singapore (i.e. throughphysical remittance or constructive remittance).

The prevailing rate of corporate income tax is 17%. In addition, three-quarters of up to thefirst S$10,000 of a company’s annual normal chargeable income, and one-half of up to thenext S$190,000, is exempt from corporate tax. The remaining chargeable income (after thepartial tax exemption) will be taxed at the applicable prevailing corporate income tax rate.
A non-Singapore tax resident company is subject to income tax on income that is accruingin or derived from Singapore, and on foreign-sourced income received or deemed received
in Singapore, subject to certain exceptions.
Dividend Distributions
Under the one-tier corporate taxation system, dividends paid by a Singapore tax resident
company are tax-exempt in the hands of the shareholders (regardless of their profile or tax
residency status).
Gains arising from disposal of Shares and Warrants
Singapore currently only imposes tax on income. Gains of a capital nature are currently not
subject to tax. In the absence of any tax exemption or incentives, gains derived by theshareholders from a disposal or Redemption of the Shares may be taxable in Singapore atthe prevailing corporate tax rate (currently 17%), to the extent that such gains are regarded
as revenue or income in nature if they arise from activities which the IRAS views as the
carrying on of a trade of business in Singapore. Such gains may also be considered asincome in nature, even if they do not arise from an activity in the ordinary course of trade358

LETTER TO SHAREHOLDERS
or business or an ordinary incident of some other business activity, if the shares werepurchased with the intention or purpose of making a profit by sale rather than for long-term
investment purposes in Singapore. Conversely, where the gains are regarded as capital innature by the IRAS, they should not be subject to Singapore income tax.
The ability to claim tax deductions on losses derived, if any, by the Singapore corporateshareholders on the disposal or Redemption of the Shares would depend on the individual
circumstances and whether the Shares are held by such shareholder on a capital orrevenue account.
Section 13W of the SITA
Section 13W (previously Section 13Z) of the SITA provides tax exemption to corporateshareholders on gains from disposal of ordinary shares which are legally and beneficiallyowned by the divesting company and which takes place between 1 June 2012 and
31 December 2027 (both dates inclusive) subject to the following key conditions:(a)immediately prior to the disposal, the divesting company has at all times during acontinuous period of at least 24 months, legally and beneficially owned at least 20%of the ordinary shares in the investee company; and(b)

the investee company being disposed of is not an excluded investee company. A
company that is listed on a stock exchange in Singapore or elsewhere would falloutside the scope of an Excluded Investee Company.

Section 13W of the SITA will not apply to a divesting company under certain scenarios.
These include (but are not limited to) a divesting company whose gains or profits arisingfrom the disposal are included as part of its income based on Section 26 of the SITA,
disposal of shares by a partnership, limited partnership or limited liability partnership where
one or more of the partners is a company or are companies, etc.
Section 10L of the SITA
The Income Tax (Amendment) Bill 2023 which was introduced in Parliament on
18 September 2023 includes a new Section 10L to the SITA that aims to bring to tax gains
from the sale or disposal by an entity of a relevant group on or after 1 January 2024, of any
movable or immovable property situated outside Singapore at the time of such sale ordisposal or any rights or interest thereof (“foreign asset”), which are received or deemed
received in Singapore, subject to conditions. This section will not apply to Singapore-onlygroups without foreign operations, or to individuals.
The proposed Section 10L should not apply if the entity meets the definition of an “excluded
entity” which includes (but is not limited to) a pure equity holding entity that has operations
managed and performed in Singapore with adequate human resources and premises in
Singapore to carry out the operations of the entity; and a non-pure equity holding entities
that has operations managed and performed in Singapore with adequate economic
substance in Singapore, among other conditions. Key substance-based indicators will be
used to assess whether an entity has adequate economic substance in Singapore,including the number, qualifications and experience of employees in Singapore, amount ofbusiness expenditure incurred by the entity in Singapore and whether the key businessdecisions of the entity are made in Singapore.

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LETTER TO SHAREHOLDERSAs the proposed Section 10L has not yet been legislated, Shareholders should consult theirown tax advisers for relevant updates and other consequences of owning and disposing of
the Shares.
Unrealised fair value gains arising from investment in Shares and Warrants
FRS109 is an accounting standard for the recognition and measurement of financial assets
and liabilities. Where a Singapore company adopts FRS 109 for accounting purposes, it
must adopt FRS 109 tax treatment.
Typically, any unrealised gains (including any related foreign exchange differences) arisingon a financial asset (equity or debt instrument) held on revenue account and treated as
FVTPL should be subject to tax on a mark-to-market basis. Where the financial asset is heldon capital account, the taxpayer needs to submit a list of assets to the IRAS annually
together with its income tax return, for determination that the assets are indeed on capital
account. FVTPL movements are to be disregarded for Singapore income tax purposes
when the assets are on capital account.
Accordingly, where FRS 109 accounting recognition is applicable to the Singapore
corporate investor for its investment in the Shares and/or Warrants of the company and it
is treated as FVTPL for accounting purposes, any unrealised fair value gains could
potentially be subject to Singapore tax at 17%, if the investment is held on revenue accountand in the absence of any tax incentive (e.g., fund tax incentive scheme).
Stamp Duty
There is no Singapore stamp duty payable on the subscription, allotment or holding of the
Shares.
Stamp duty is payable on executed share transfer instrument at the rate of 0.2% on theamount of consideration paid or market value of the shares transferred, whichever is higher.
The purchaser is liable for stamp duty, unless there is an agreement to the contrary.
Where an instrument of transfer (including electronic documents) is executed outside
Singapore, stamp duty is payable if the executed instrument of transfer is received in
Singapore. An electronic instrument that is executed outside Singapore is received in
Singapore if (a) it is retrieved or accessed by a person in Singapore; (b) an electronic copyof it is stored on a device (including a computer) and brought into Singapore; or (c) an
electronic copy of it is stored on a computer or server in Singapore.
No Singapore stamp duty is payable in respect of the transfer of Shares of the company thatare settled on a book-entry basis through the CDP.
Estate Duty
Singapore estate duty has been abolished with effect from 15 February 2008.
GST
The purchase of Shares or Warrants should not attract any GST in Singapore. Any GST
incurred directly by a GST-registered investor in making the purchase is generally notrecoverable as an input tax credit by the investor.
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LETTER TO SHAREHOLDERS
The sale of Shares or Warrants by a GST-registered investor belonging in Singapore toanother person belonging in Singapore or via the Singapore exchange, is an exempt supply
that is not subject to GST. Any GST incurred by the investor that is directly attributable tothe making of the exempt supply is generally not recoverable as an input tax credit by theinvestor.
Where the Shares or Warrants are sold by a GST-registered investor in the course of or
furtherance of a business carried on by such investor via an overseas exchange orcontractually to a person belonging in a country other than in Singapore and directly
benefitting a person belonging in a country other than Singapore or a person belonging in
Singapore but registered for GST in Singapore, and the contractual person is outside
Singapore when the sale is executed, the sale should be considered a taxable supply thatis subject to GST at zero-rate. Any GST incurred by a GST-registered investor that is
directly attributable to the making of the zero-rated supply should be recoverable as an
input tax credit.
Services such as brokerage, handling, clearing and professional services rendered by a
GST-registered person to an investor belonging in Singapore in connection with theinvestor’s purchase, sale or holding of the Shares or Warrants will be subject to GST at theprevailing rate which is currently 8% and would be increased to 9% with effect from
1 January 2024. Similar services rendered contractually to a person belonging in a country
other than in Singapore and directly benefitting a person belonging outside Singapore or aperson belonging in Singapore but registered for GST in Singapore should, subject to thesatisfaction of certain conditions, generally be zero-rated for Singapore GST purposes.
Services such as brokerage, handling, clearing and professional services rendered by aperson belonging outside Singapore to an investor (whether GST-registered or non-GST
registered) belonging in Singapore in connection with the investor’s purchase, sale or
holding of the Units, Shares or Warrants in the course of or furtherance of a businesscarried on by the investor (“Business Investor”), may be subject to reverse charge undercertain circumstances.
Investors should seek their own tax advice on the recoverability of GST incurred on
expenses in connection with the purchase, sale and holding of the Shares or Warrants aswell as the reverse charge implications if expenses are incurred by a Business Investor
from a service provider belonging in a country other than in Singapore.
Cayman Islands
The following is a discussion on certain Cayman Islands income tax consequences of aninvestment in the securities of the Company. The discussion is a general summary ofpresent law, which is subject to prospective and retroactive change. It is not intended as tax
advice, does not consider any investor’s particular circumstances, and does not consider
tax consequences other than those arising under Cayman Islands law.
Under existing Cayman Islands laws:
Payments of dividends and capital in respect of the Company’s securities will not be subject
to taxation in the Cayman Islands and no withholding will be required on the payment of adividend or capital to any holder of the securities, nor will gains derived from the disposal

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LETTER TO SHAREHOLDERSof the securities be subject to Cayman Islands income or corporate tax. The Cayman
Islands currently has no income, corporate or capital gains tax and no estate duty,
inheritance tax or gift tax.
The Company has been incorporated under the laws of the Cayman Islands as an
exempted company with limited liability and, as such, has received an undertaking from the
Financial Secretary of the Cayman Islands in the following form:
The Tax Concessions Act (As Revised)
Undertaking as to Tax Concessions
In accordance with the Tax Concessions Act (As Revised), the following undertaking ishereby given to Vertex Technology Acquisition Corporation (the “Company”):
1.

That no law which is hereafter enacted in the Islands imposing any tax to be levied on
profits, income, gains or appreciations shall apply to the Company or its operations;and2.

In addition, that no tax to be levied on profits, income, gains or appreciations or whichis in the nature of estate duty or inheritance tax shall be payable:a.

on or in respect of the shares, debentures or other obligations of the Company;orb.

by way of the withholding in whole or in part of any relevant payment as definedin the Tax Concessions Act (As Revised).

These concessions shall be for a period of TWENTY years from the 29th day of October
2021.
32.

PROPOSED CHANGE OF THE COMPANY’S NAME
Pursuant to the terms of the SPA, and conditional upon and concurrent with Completion, theCompany is required to change its name from “Vertex Technology Acquisition Corporation
Ltd” to “17LIVE Group Limited” to better reflect the identity of the Enlarged Group and the
new business and activities of the Enlarged Group.
In line with the Proposed Change of the Company’s Name, the Company also intends toadopt a new corporate logo as shown below:

32.1 Approvals
An application has been made to the Cayman Islands Registrar of Companies by theCompany on behalf of the Vendor for the reservation of the name of “17LIVE Group Limited”
on 15 September 2023. The proposed name has been reserved with the Cayman Islands
Registrar of Companies until 14 December 2023.

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LETTER TO SHAREHOLDERS
Subject to Shareholders’ approval of the special resolution for the Proposed Change of theCompany’s Name and registration by the Cayman Islands Registrar of Companies, theCompany shall change its name to “17LIVE Group Limited” with effect from Completion andthe issue by the Cayman Islands Registrar of Companies of the certificate confirming theincorporation of the Company under the new name (being the issuance of the Certificate ofIncorporation upon Change of Name). The new name “17LIVE Group Limited” shall be
substituted for “Vertex Technology Acquisition Corporation Ltd” wherever the latter nameappears in the Memorandum and Articles of Association.
The resolution to seek Shareholders’ approval for the Proposed Change of the Company’s
Name is set out in Special Resolution 1 in the Notice of EGM.
The Company will make an announcement to notify Shareholders when the Proposed
Change of the Company’s Name takes effect.
32.2 Existing Share Certificates and Warrant Certificates
Shareholders should note that the Proposed Change of the Company’s Name does notaffect any of the rights of the Shareholders and the Warrantholders and the legal status of
the Company. The Company will be recalling existing share certificates and warrant
certificates of the Company bearing the current name, that is, “Vertex Technology
Acquisition Corporation Ltd” and issuing new share certificates and warrant certificatesbearing the new name, that is, “17LIVE Group Limited” which states the lower number of
Shares outstanding post-Redemption. No further action is required to be taken on the partof the Shareholders in relation to the Proposed Change of the Company’s Name.
Upon the Proposed Change of Name becoming effective, any new share certificates andwarrant certificates of the Company will be issued under the new name “17LIVE Group
Limited”.
33.

PROPOSED ADOPTIONASSOCIATION

OF

THE

NEW

MEMORANDUM

AND

ARTICLES

OF

33.1 BackgroundThe existing Memorandum and Articles of Association was adopted by the Company on(and was effective on) 6 January 2022 in connection with its listing on the SGX-ST. Since
the existing Memorandum and Articles of Association was adopted, amendments have been
introduced to the Personal Data Protection Act and the Mainboard Rules.
33.2 Rationale for the New Memorandum and Articles of Association
In connection with the Proposed Transactions, the Company has undertaken a review of its
Memorandum and Articles of Association and proposes to adopt the New Memorandum andArticles of Association as set out at Appendix D to this Circular, in place of its existing
Memorandum and Articles of Association, to streamline its Memorandum and Articles of
Association and to remove obsolete SPAC provisions.

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LETTER TO SHAREHOLDERS
The proposed New Memorandum and Articles of Association also contains updated
provisions which are consistent with the Mainboard Rules prevailing as at the Latest
Practicable Date, in compliance with Rule 730 of the Mainboard Rules, as well as toaddress other regulatory changes, namely, the personal data protection regime in
Singapore.
The resolution to seek Shareholders’ approval for the Proposed Adoption of the New
Memorandum and Articles of Association is set out in Special Resolution 2 in the Notice ofEGM. Subject to Shareholders’ approval of the special resolution for the Proposed Adoptionof the New Memorandum and Articles of Association, the Company shall adopt the New
Memorandum and Articles of Association with effect from Completion.
33.3 Summary of Main Differences Between the existing Memorandum and Articles of
Association and the New Memorandum and Articles of Association
The following is a summary of the provisions of the proposed New Memorandum andArticles of Association which are significantly different from the equivalent provisions in theexisting Memorandum and Articles of Association. It does not set out all the new andamended provisions in the proposed New Memorandum and Articles of Association andshould be read in conjunction with the proposed New Memorandum and Articles of
Association which is set out in its entirety in Appendix D to this Circular. For Shareholders’ease of reference, Appendix E sets out a comparison of the proposed New Memorandum
and Articles of Association against the existing Memorandum and Articles of Association,with all additions underlined and any deletions marked with a strikethrough.
Unless otherwise defined, capitalised terms in Sections 33.3 and 33.4 of this Circular below
shall bear the meanings ascribed to them in the proposed New Memorandum and Articles
of Association.
Changes to Remove Obsolete SPAC Provisions
The following articles have been amended/deleted to remove obsolete SPAC provisions:(a)Article 1 (Article 1 of the existing M&AA). Definitions in relation to the Company’s
initial business combination have been deleted, namely, the definitions of “Acquisition
Mandate”, “Business Combination”, “Escrow Account”, “IPO”, “Prospectus”,“Redemption Notice”, “Representative” and “Underwriter”.

(b)

Article 8 (Article 8 of the existing M&AA). Shareholders’ entitlement to request the
Redemption of Shares in the circumstances pertaining to a business combination
pursuant to Article 50 of the existing M&AA has been deleted.

(c)

Article 20.2 of the existing M&AA. Article 20.2 of the existing M&AA, which sets out
the notice period for any general meeting at which it is proposed to consider any
proposal in connection with an initial business combination, has been deleted.

(d)

Article 26.1 of the existing M&AA. Article 26.1 of the existing M&AA, which provides
that prior to the consummation of an initial business combination, in the event of theresignation or replacement of any Directors or Executive Officers of the Company(which are not due to natural cessation events such as death, bankruptcy,
disqualification from acting as a director under applicable law, mental disorder or other364

LETTER TO SHAREHOLDERS
medical reasons), the Company shall convene a general meeting at which a special
resolution shall be passed for the Company’s continued listing on the SGX-ST, hasbeen deleted.
(e)

Article 26.2 of the existing M&AA. Article 26.2 of the existing M&AA, which provides
that in the event that a special resolution for the Company’s continued listing on the
SGX-ST is not passed at the general meeting convened pursuant to Article 26.1 of theexisting M&AA, the Company shall be liquidated in accordance with Article 45 of theexisting M&AA.

(f)

Article 50 of the existing M&AA. Article 50 of the existing M&AA, which sets out,
among others, requirements in relation to the Company’s initial business combination,
Shareholders’ Redemption Right, the Redemption Limit and the consequences of theCompany not consummating an initial business combination within the BC Deadline,
has been deleted.

Other amendments
The following articles have been amended/included:(a)Article 3.5 (Article 3.5 of the existing M&AA). A new limitation has been included toprovide that the total number of issued preference shares shall not exceed the total
number of Shares issued at any time.

(b)

Article 13.2 (Article 13.2 of the existing M&AA). A new provision has been added toclarify that any Shares on which the Company has a lien or whose call remain unpaid,
and which are sold pursuant to Article 13.2, will be sold pursuant to procedure for thesale of forfeited Shares as described in Article 15.

(c)

New Article 30(f). In addition to the existing circumstances for the office of a Director
to be vacated, a new circumstance has been added, namely, if the Director is removed
from office by ordinary resolution.

(d)

Article 30.1 (Article 31.1 of the existing M&AA). Article 30.1 relating to the quorum
for the transaction of the business of Directors has been amended to state that if thequorum is not fixed by the Directors, it shall be a majority of the Directors then in office,including the chairperson; provided that a quorum shall exist at a meeting at which aquorum would exist but for the fact that the chairperson is voluntarily absent from themeeting and notifies the Board of Directors his decision to be absent from thatmeeting, before or at the meeting.

(e)

Article 32.5 (Article 33.5 of the existing M&AA). Article 33.5 of the existing M&AA,
which provides that a general notice that a Director is to be regarded as interested in
any transaction shall be sufficient disclosure for the purposes of voting on a resolution
in respect of a contract or transaction in which he has an interest, and after suchgeneral notice it shall not be necessary to give special notice relating to any particulartransaction, has been deleted.

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LETTER TO SHAREHOLDERS
33.4 Summary of Principal Provisions of the New Memorandum and Articles of
Association
Registration Number
The Company was incorporated on 21 July 2021 and the Company’s registration number is378671.
Memorandum and Articles of Association
The New Memorandum of Association states, inter alia, that the liability of each member islimited to the amount, if any, unpaid on the shares held by such member. Paragraph 3 of
the New Memorandum of Association states that the objects for which the Company isestablished are unrestricted and the Company shall have full power and authority to carryout any object not prohibited by the law of the Cayman Islands.
Ordinary and Special Resolution
An “ordinary resolution” is defined in the New M&AA as a resolution passed by a simple
majority of votes cast by members, being entitled so to do, voting in person or, in the caseof members being corporations, by their respective duly authorised representatives or,where proxies are allowed, by proxy at a general meeting of the Company.
A “special resolution” is defined in the New Articles of Association as a resolution passedby holders of a majority of not less than three-quarters of votes cast by members, being
entitled so to do, voting in person or, in the case of members being corporations, by theirrespective duly authorised representatives or, where proxies are allowed, by proxy at a
general meeting of the Company. Notices convening any general meeting at which it is
proposed to pass a special resolution shall be sent to members entitled to attend and voteat the meeting at least 21 calendar days before such meeting (excluding the date of noticeand the date of the meeting).
Article 21.3 of the New M&AA provides that subject to the Cayman Companies Act, aresolution in writing signed by or on behalf of all persons for the time being entitled toreceive notice of and to attend and vote at general meetings of the Company shall, for the
purposes of the New M&AA, be treated as a resolution duly passed at a general meetingof the Company and, where relevant, as a special resolution so passed.
Directors
Interested Directors to be Restricted from Voting (Articles 32.4 and 32.5)
A Director shall not participate in any discussions and shall not be entitled to vote on any
resolution of the Board in respect of any contract, transaction or arrangement, or proposed
contract, transaction or arrangement of any other proposal whatsoever (and/or receive any
information relating thereto) (a) in which such Director has any material interest (personalor otherwise), whether directly or indirectly; or (b) which might, whether directly or indirectly,
create a conflict with his duties or interests as a Director. An interested Director may
nevertheless be counted as part of the quorum for a meeting of the Directors at which a
resolution in respect of the proposed contract, transaction or arrangement in which he/she
has an interest is tabled as quorum requirements are generic and do not distinguishbetween interested and non-interested Directors, provided that such an interested Director
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LETTER TO SHAREHOLDERS
shall not be permitted to vote in respect of such proposed contract or transaction at such
Board meeting (or pursuant to a resolution in writing to be signed by all the Directors or all
the members of a committee of the Directors whom are entitled to vote on the same)notwithstanding any notice given to the Board regarding such interest.
A Director, whose remuneration (including pension or other benefits) for himself is the
subject of a resolution tabled at a meeting of the Board, shall not be entitled to vote on the
resolution as he shall be taken have a personal material interest in the matter. Other
Directors of the Company will not be prohibited by the New M&AA from voting on that
resolution so long as they do not have any direct or indirect personal material interest in thesubject matter of the said resolution.
Remuneration (Articles 36.1, 36.2 and 36.3)
The fees of the Directors shall from time to time be determined by the Company in general
meeting, 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 general meeting, and shall (unless otherwise directed by the resolution bywhich it is voted) be divided amongst the Board in such proportions and in such manner as
the Board may agree or, failing agreement, equally, except that any Director who shall holdoffice for part only of the period in respect of which such remuneration is payable shall beentitled only to rank in such division for a proportion of remuneration related to the period
during which such Director has held office.
The Directors may by resolution approve additional remuneration to any Director for any
services which in the opinion of the Directors go beyond his ordinary routine work as a
Director. Any fees paid to a Director who is also counsel, attorney or solicitor to theCompany, or otherwise serves it in a professional capacity shall be in addition to such
person’s remuneration as a Director.
An Executive Director, including a managing director or a person holding an equivalent
position, of the Company shall receive such remuneration (whether by way of salary,commission, participation in profits or otherwise or by all or any of those modes) and suchother benefits (including pension and/or gratuity and/or other benefits on retirement) andallowances as the Board may from time to time determine, and either in addition to or in lieu
of his remuneration as a Director, but no such Executive Director or Director shall in any
circumstances be remunerated by a commission on or a percentage of turnover.
Borrowing Powers (Article 27.4)
Subject to the provisions of the New Articles of Association, the Board may exercise all thepowers of the Company to raise or borrow money and to mortgage or charge all or any partof the undertaking, property and assets (present and future) and uncalled capital of theCompany and, subject to the Cayman Companies Act, to issue debentures, bonds and othersecurities, whether outright or as collateral security for any debt, liability or obligation of theCompany or of any third party.
Retirement Age Limit
There are no provisions relating to retirement of Directors upon reaching any age limit.

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LETTER TO SHAREHOLDERS
Shareholding Qualification (Article 35)
Neither a Director nor an alternate Director is required to hold any Shares of the Company
by way of qualification.
Share Rights and Restrictions
The Company currently has only one class of shares, namely Shares.
Dividends and Distributions (Article 39)
Subject to the Cayman Companies Act and except as otherwise provided by the rights
attached to any Shares, the Directors may resolve to pay dividends and other distributions
on Shares in issue and authorise payment of the dividends or other distributions out of thefunds of the Company lawfully available therefor. A dividend shall be deemed to be aninterim dividend unless the terms of the resolution pursuant to which the Directors resolve
to pay such dividend specifically state that such dividend shall be a final dividend. No
dividend or other distribution shall be paid except out of the realised or unrealised profits
of the Company, out of the share premium account or as otherwise permitted by law.
Except as otherwise provided by the rights attached to any Shares, all dividends and other
distributions shall be paid according to the par value of the Shares that a member holds. If
any Share is issued on terms providing that it shall rank for dividend as from a particulardate, that Share shall rank for dividend accordingly, provided that where such Shares are
partly paid, all dividends or other profits or distributions must be apportioned and paid
proportionately to the amounts paid or credited as paid on the partly paid Shares.
The Directors may deduct from any dividend or other distribution payable to any member all
sums of money (if any) then payable by him to the Company on account of calls orotherwise.
The Directors may resolve that any dividend or other distribution be paid wholly or partly by
the distribution of specific assets and in particular (but without limitation) by the distributionof shares, debentures, or securities of any other company or in any one or more of such
ways and where any difficulty arises in regard to such distribution, the Directors may settle
the same as they think expedient and in particular may issue fractional Shares and may fix
the value for distribution of such specific assets or any part thereof and may determine thatcash payments shall be made to any members upon the basis of the value so fixed in orderto adjust the rights of all members and may vest any such specific assets in trustees in suchmanner as may seem expedient to the Directors.
Any dividend or other distribution which cannot be paid to a member and/or which remains
unclaimed after six months from the date on which such dividend or other distribution
becomes payable may, in the discretion of the Directors, be paid into a separate account in
the Company’s name, provided that the Company shall not be constituted as a trustee inrespect of that account and the dividend or other distribution shall remain as a debt due tothe member. Any dividend or other distribution which remains unclaimed after a period of six
years from the date on which such dividend or other distribution becomes payable shall be
forfeited and shall revert to the Company.

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LETTER TO SHAREHOLDERS
Voting Rights (Articles 22 and 23)
Subject to any special rights or restrictions as to voting for the time being attached to any
Shares by or in accordance with the New Articles of Association, at any general meeting (i)on a show of hands every member present in person (or being a corporation, is present by
a representative duly authorised under Article 22.1 or by proxy shall have one vote; and (ii)
on a poll every member present in person or by proxy or, in the case of a member being a
corporation, by its duly authorised representative shall have one vote for every fully paid
Share of which such member is the holder. For so long as the Shares of the Company arelisted on SGX-ST, if required by the rules or regulations of SGX-ST, all resolutions at
general meetings shall be voted by poll unless such requirement is waived by SGX-ST. If
the member is CDP or a relevant intermediary, CDP or the relevant intermediary may eachappoint more than two proxies to attend and vote at the same general meeting and eachproxy shall be entitled to exercise the same powers on behalf of CDP or the relevantintermediary (as the case may be) as CDP or the relevant intermediary (as the case maybe) could exercise, including the right to vote individually on a show of hands or on a poll.
The New Memorandum and Articles of Association do not provide for cumulative voting in
relation to election or re-election of Directors.
Share in Profits
Holders of Shares shall be entitled to share in the Company’s profits by way of dividends
declared or distributions approved by the Company in general meeting or by the Directors
in accordance with the Cayman Companies Act and the New Memorandum and Articles of
Association.
Liquidation (Articles 44.1 and 44.2)
Shareholders are entitled to the surplus assets of the Company in the event that it is woundup.
If the Company shall be voluntarily wound up, the application to wind up the Company shall,subject to applicable law (including the Cayman Companies Act), be made pursuant to theprovisions of the Insolvency, Restructuring and Dissolution Act 2018, No. 40 of 2018, ofSingapore. If the Company shall be involuntarily wound up, the administration of thewinding-up process shall be by the Cayman court in accordance with the Cayman
Companies Act.
If the Company shall be wound up, the liquidator shall, subject always to applicable law,apply the assets of the Company in satisfaction of creditors’ claims in such manner andorder as such liquidator thinks fit. Subject to the rights attaching to any Shares, in a windingup:(a)if the assets available for distribution amongst the members shall be insufficient to
repay the whole of the Company’s issued share capital, such assets shall be
distributed so that, as nearly as may be, the losses shall be borne by the members inproportion to the par value of the Shares held by them; or

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LETTER TO SHAREHOLDERS(b)

if the assets available for distribution amongst the members shall be more thansufficient to repay the whole of the Company’s issued share capital at thecommencement of the winding up, the surplus shall be distributed amongst themembers in proportion to the par value of the Shares held by them at thecommencement of the winding up subject to a deduction from those Shares in respectof which there are monies due, of all monies payable to the Company for unpaid calls
or otherwise.

If the Company shall be wound up (whether the liquidation is voluntary, under supervision,or by the court) the liquidator may, subject to the rights attaching to any Shares andapplicable law, and with the approval of a special resolution of the Company and any otherapproval required under applicable law, divide amongst the members in kind the whole or
any part of the assets of the Company (whether such assets shall consist of property of thesame kind or not) and may for that purpose set such value as such liquidator deems fair
upon any assets and may determine how the division shall be carried out as between themembers or different classes of members. The liquidator may, with the like approval, vest
the whole or any part of such assets in trustees upon such trusts for the benefit of themembers as the liquidator, with the like approval, shall think fit, but so that no member shallbe compelled to accept any asset upon which there is a liability.
Redemption Provisions (Article 8)
Subject to the Cayman Companies Act, the New Memorandum and Articles of Association
and, where applicable, the rules or regulations or waivers of SGX-ST, and to any special
rights conferred on the holders of any shares or attaching to any class of shares, Shares
may be issued on the terms that they may be, or at the option of the Company or the holder
are, liable to be redeemed on such terms and in such manner, including out of capital, as
the Board may deem fit in accordance with the Cayman Companies Act.
Sinking Fund
The New Memorandum and Articles of Association do not contain sinking fund provisions.
Calls on Shares (Article 14)
Subject to the terms of the allotment and issue of any Shares, the Directors may make calls
upon the members in respect of any monies unpaid on their Shares (whether in respect ofpar value or premium), and each member shall (subject to receiving at least fourteen clear
days’ notice specifying the time or times of payment) pay to the Company at the time ortimes so specified the amount called on the Shares. A call may be revoked or postponed,in whole or in part, as the Directors may determine. A call may be required to be paid byinstalments. A person upon whom a call is made shall remain liable for calls made upon him
notwithstanding the subsequent transfer of the Shares in respect of which the call was
made.
If a call remains unpaid after it has become due and payable, the person from whom it isdue shall pay interest on the amount unpaid from the day it became due and payable until
it is paid at such rate as the Directors may determine (and in addition all expenses that havebeen incurred by the Company by reason of such non-payment), but the Directors may
waive payment of the interest or expenses wholly or in part.

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LETTER TO SHAREHOLDERSThe Directors may, if they think fit, receive an amount from any member willing to advanceall or any part of the monies uncalled and unpaid upon any Shares held by him, and may(until the amount would otherwise become payable) pay interest at such rate as may be
agreed upon between the Directors and the member paying such amount in advance.
The New Memorandum and Articles of Association states that the liability of each memberof the Company is limited to the amount, if any, unpaid on the Shares held by such member.
Discriminatory Provisions against Substantial Shareholder
Neither the Cayman Companies Act nor the New Memorandum and Articles of Association
contain any provision discriminating against any existing or prospective holder of Shares asa result of such Shareholder owning a substantial number of Shares.
Variation of Rights of Existing Shares or Classes of Shares (Article 10)
If at any time the share capital of the Company is divided into different classes of shares,
all or any of the rights attached to any class (save and except for preference shares (otherthan redeemable preference shares)) may, whether or not the Company is being wound up,
be varied without the consent of the holders of the issued shares of that class where suchvariation is considered by the Directors not to have a material adverse effect upon suchrights. For the avoidance of doubt, the Directors reserve the right, notwithstanding that any
such variation may not have a material adverse effect, to obtain consent from the holdersof shares of the relevant class at a separate meeting of such class held for such purpose.
To any such meeting all the provisions of the New Memorandum and Articles of Association
relating to general meetings shall apply mutatis mutandis, except that the necessary
quorum shall be one person holding or representing by proxy at least one-third of the issued
shares of the class and that any holder of shares of the class present may demand a poll.
Subject to the provisions of the applicable law, preference shares (other than redeemablepreference shares) may be repaid or repurchased and the special rights attached topreference shares may be varied or abrogated only with the sanction of a special resolution
passed at a separate class meeting of the preference shareholders concerned (but nototherwise), provided always that where the necessary majority for such a special resolution
is not obtained at such class meeting, the consent in writing if obtained from the holders of
three-quarters of the issued shares of the class concerned within two calendar months ofthe date of such meeting shall be as valid and effectual as a special resolution adopted atsuch meeting.
The rights conferred upon the holders of the shares of any class issued with preferred orother rights shall not, unless otherwise expressly provided by the terms of issue of theshares of that class, be deemed to be varied by the creation or issue of further sharesranking pari passu therewith or shares issued with preferred or other rights.

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LETTER TO SHAREHOLDERS
General Meetings (Articles 19 and 23)
Under the New Memorandum and Articles of Association, the Company may but shall not(unless required by the Cayman Companies Act or where applicable, the rules andregulations of SGX-ST and/or any other competent regulatory authority or otherwise underapplicable law) be obliged to, in each year hold a general meeting as its annual general
meeting, and shall specify the meeting as such in the notices calling it. For so long as the
Shares of the Company are listed on SGX-ST, the Company shall hold all its general
meetings in Singapore (unless prohibited by any applicable law) or such other jurisdiction
as permitted or required by the applicable law or the rules or regulations of SGX-ST.
The Company shall hold its annual general meeting within 4 months from the end of its
financial year (or such other period as may be permitted by the applicable law or the rules
and regulations of SGX-ST).
The Directors, the chief executive officer or the chairperson of the board of Directors may
call general meetings, and general meetings shall also be convened on a members’
requisition. A members’ requisition is a requisition of members holding at the date of depositof the requisition not less than ten per cent of the total number of paid-up Shares which asat that date carry the right to vote at general meetings of the Company.
No business shall be transacted at any general meeting unless a quorum is present. Twomembers present shall be a quorum unless there is only one member of the Company inwhich case that member may constitute a quorum. For the avoidance of doubt, where amember is the depository, one or more person(s) attending as the depository’s proxy or as
the depository’s duly authorised representative may count towards the quorum.
For so long as the Shares of the Company are listed on SGX-ST, if required by the rules orregulations of SGX-ST, all resolutions at general meetings shall be voted by poll unlesssuch requirement is waived by SGX-ST. A poll shall be taken as the chairperson directs, andthe result of the poll shall be deemed to be the resolution of the general meeting at which
the poll was required or demanded.
An instrument appointing a proxy shall be deemed to include the right to demand or join in
demanding a poll, to move any resolution or amendment thereto and, if afforded theopportunity, to speak at the meeting the same as any other voting member. Votes may becast either personally or by proxy (or in the case of a corporation or other non-natural
person by its duly authorised representative or proxy). A member may appoint more than
one proxy or the same proxy under one or more instruments to attend and vote at a
meeting. Where a member appoints more than one proxy the instrument of proxy shallspecify the number of Shares in respect of which each proxy is entitled to exercise therelated votes.
A member, including for the avoidance of doubt a depository, holding more than one Shareneed not cast the votes in respect of such member’s Shares in the same way on any
resolution and therefore may vote a Share or some or all such Shares either for or against
a resolution and/or abstain from voting a Share or some or all of the Shares and, subject
to the terms of the instrument appointing such member, a proxy appointed under one ormore instruments may vote a Share or some or all of the Shares in respect of which suchmember is appointed either for or against a resolution and/or abstain from voting a Shareor some or all of the Shares in respect of which such member is appointed.

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LETTER TO SHAREHOLDERS
Any member entitled to attend, vote and speak at a meeting of the Company who is theholder of two or more Shares shall be entitled to appoint not more than two proxies toattend, vote and speak instead of such member at the same general meeting provided that
if the member is the depository:(a)the depository may appoint more than two proxies to attend, vote and speak at thesame general meeting and each proxy shall be entitled to exercise the same powers
on behalf of the depository as the depository could exercise;(b)unless the depository specifies otherwise in a written notice to the Company, thedepository shall be deemed to have appointed as the depository’s proxies to vote on
behalf of the depository at a general meeting of the Company each of the depositors
who are individuals and whose names are shown in the records of the depository as
at a time not earlier than 48 hours prior to the time of the relevant general meeting
supplied by the depository to the Company, the appointment of proxies by thedepository shall not require an instrument of proxy or the lodgement of any instrumentof proxy;(c)the Company shall accept as valid in all respects the form of instrument of proxyapproved by the depository (the “Depository Proxy Form” or “Proxy Form”) for use
at the date relevant to the general meeting in question naming a depositor (the“Nominating Depositor”) and permitting that Nominating Depositor to nominate aperson or persons other than the Nominating Depositor as the proxy or proxies
appointed by the depository. A Nominating Depositor who is not a relevantintermediary may nominate not more than two persons to attend and vote in such
Nominating Depositor’s place as proxy or proxies appointed by the depository, and a
Nominating Depositor who is a relevant intermediary may nominate more than two
persons to attend and vote in its place as proxies appointed by the depository. The
Company shall, in determining rights to vote and other matters in respect of acompleted Depository Proxy Form submitted to it, have regard to the instructions given
by and the notes (if any) set out in the Depository Proxy Form. The submission of any
Depository Proxy Form shall not affect the operation of (b) and shall not preclude a
depositor appointed as a proxy by virtue of (b) from attending and voting at therelevant meeting but in the event of attendance by such depositor the Depository
Proxy Form submitted bearing such depositor’s name as the Nominating Depositor
shall be deemed to be revoked;(d)the Company shall reject any Depository Proxy Form of a Nominating Depositor if such
Nominating Depositor’s name is not shown in the records of the Depository as at atime not earlier than forty-eight (48) hours prior to the time of the relevant general
meeting supplied by the depository to the Company; and(e)on a poll the maximum number of votes which a depositor, or proxies appointed
pursuant to a Depository Proxy Form in respect of that depositor, is able to cast shallbe the number of Shares credited to the Securities Account of that depositor as shownin the records of the depository as at a time not earlier than forty-eight (48) hours prior
to the time of the relevant general meeting supplied by the depository to the Company(or such timing as may be stipulated by SGX-ST from time to time), whether that
number is greater or smaller than the number specified in any Depository Proxy Formor instrument of proxy executed by or on behalf of the depository.

See also the section “Ordinary and Special Resolution” above.
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LETTER TO SHAREHOLDERS
No Limitation on Non-Cayman Shareholders
There are no limitations, either under Cayman Islands law or the New Memorandum andArticles of Association, on the rights of owners of the Company’s Shares to hold or vote their
Shares solely by reason that they are non-Cayman Island shareholders.
Shareholding Disclosure Requirements
The Cayman Companies Act and the New Memorandum and Articles of Association do not
require disclosure of shareholder ownership beyond a certain threshold.
Changes in Capital (Articles 17.1 and 17.4)
Under the Cayman Companies Act, certain changes in the capital of a company such as anincrease, consolidation or subdivision are permitted if authorised by its memorandum andarticles of association and its shareholders. Article 17.1 of the New Memorandum andArticles of Association provides that an ordinary resolution is required for an increase to,consolidation or subdivision of, the Company’s share capital. Under Article 17.4 of the New
Memorandum and Articles of Associations, the Company may by special resolution, subject
to any confirmation or consent required by the Cayman Companies Act, reduce its sharecapital in any manner permitted by law.
34.

PROPOSED CHANGE OF THE COMPANY’S INDEPENDENT AUDITOR

34.1 Background and Rationale for the Proposed Change of the Company’s Independent
Auditor
The Company’s existing auditor is KPMG LLP. The Proposed New Board is proposing theappointment of Ernst & Young LLP as independent auditor of the Company in place of theexisting Independent Auditor, KPMG LLP, with effect from the Completion Date and for thefinancial year ending 31 December 2023 and to hold office until the conclusion of the next
AGM, subject to approval for the Proposed Transactions being obtained from Shareholders
at the EGM and subject to Completion taking place.
The board is proposing the Proposed Change of the Company’s Independent Auditor for the
purpose of continuity as Ernst & Young LLP is the existing independent auditor of the Target
Group. Following Completion, the principal business of the Enlarged Group will be thebusiness of the Target Group. As such, the Board is of the opinion that Ernst & Young LLP
will be more familiar with the Target Group’s business and be better positioned to act as theindependent auditor of the Company following Completion. In addition, the Proposed
Change of the Company’s Independent Auditor is not due to any dismissal of KPMG LLP,
or due to KPMG LLP declining to stand for election. It is also not a reflection of any concerns
over the integrity of the Company’s operations or management or effectiveness of theCompany’s internal controls or the capability of the auditor of the Company.
The resignation of KPMG LLP as Independent Auditor of the Company will take effect fromthe Completion Date, subject to approval for the Proposed Change of the Company’s
Independent Auditor and the Proposed Transactions being obtained from Shareholders at
the EGM and subject to Completion taking place.

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LETTER TO SHAREHOLDERS
34.2 Information on Ernst & Young LLP
Ernst & Young LLP, an accounting firm registered with ACRA, is one of the largest
professional services organisations in Singapore, and is among the “Big Four” accounting
firms in Singapore.
Ernst & Young LLP has more than 134 years of experience providing audit, tax andprofessional services to the Singapore and global markets and employs more than 350,000
people globally. Ernst & Young LLP has relevant industry experience with audit clients in thetechnology, live streaming and e-commerce industry that the Target Group is in.
More information about Ernst & Young LLP, its values and its services can be found on Ernst& Young’s website at www.ey.com.
Sharon Peh (“Sharon”), a partner with Ernst & Young LLP, will be assigned to the audit of
the Company as the audit partner-in-charge. Sharon has more than 17 years of experiencein providing audit and assurance services to clients in a wide range of industries, including
technology, live streaming, e-commerce and in-app gaming, and to clients which are publiccompanies listed on the Exchange. Sharon is registered as a public accountant with ACRA.
Sharon is also a practising member of the Institute of Singapore Chartered Accountants,
and a member of CPA Australia.
34.3 Disclosure pursuant to Rule 1205(5) of the Mainboard Rules(a)

Rule 1203(5)(a) – Confirmation from the outgoing auditor
The outgoing auditor, KPMG LLP, has confirmed that they are not aware of any
professional reasons why Ernst & Young LLP should not accept appointment as the
new auditor of the Company.

(b)

Rule 1203(5)(b) – Confirmation from the issuer on any disagreements withoutgoing auditor
The Company confirms that there were no disagreements with KPMG LLP on
accounting treatments within the last 12 months.

(c)Rule 1203(5)(c) – Confirmation from the issuer on circumstances connected withchange of auditor
The Company confirms that it is not aware of any circumstances connected with the
Proposed Change of the Company’s Independent Auditor that should be brought to theattention of the Shareholders which has not been disclosed in this Circular.

(d)Rule 1203(5)(d) – Specific reasons for change of auditor
The Company confirms that the specific reasons for the Proposed Change of theCompany’s Independent Auditor are disclosed in Section 34.1 titled “Proposed
Change of the Company’s Independent Auditor – Background and Rationale for the
Proposed Change of the Company’s Independent Auditor” of this Circular. The
Proposed Change of the Company’s Independent Auditor is neither due to thedismissal of KPMG LLP nor KPMG LLP declining to stand for re-election.

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LETTER TO SHAREHOLDERS(e)1203(5)(e) – Confirmation from issuer on compliance with Rules 712 and 715 or
716
The Company confirms that it complies with Rules 712, 715 and 716 of the Mainboard
Rules in relation to the proposed appointment of Ernst & Young LLP as auditor of theCompany.

The Proposed Change of the Company’s Independent Auditor has been reviewed andrecommended by the Audit Committee.
35.

PROPOSED APPOINTMENT OF THE PROPOSED DIRECTORS
Upon Completion, the Company proposes to appoint the Proposed Directors who are as
follows:(a)Mr. Phua Jiexian Joseph (Non-Executive Director and Chairman);(b)

Mr. Lien Chien-Lin (Executive Director and CEO);(c)

Mr. Akio Tanaka (Non-Executive Director);(d)Mr. Hideto Mizuno (Independent Non-Executive Director); and(e)

Ms. Chen Xiuling (Independent Non-Executive Director)

Please refer to Section 24 titled “Proposed Directors and Executive Officers of the Enlarged
Group” of this Circular for details on the working experience and qualifications of the
Proposed Directors.
36.

INTERESTS OF DIRECTORS AND SUBSTANTIAL SHAREHOLDERS
Save as disclosed in this Circular and save for the interests of the Directors and Substantial
Shareholders in the Shares as disclosed in Section 23.5 titled “Enlarged Group Corporate
and Shareholding Structure – Changes in Shareholding Structure” of this Circular, none of
the Directors or Substantial Shareholders of the Company has any interests, direct orindirect, in the Proposed Transactions.

37.

INTERESTS OF SOLE ISSUE MANAGER, JOINT FINANCIAL ADVISERS, JOINT
PLACEMENT AGENTS AND INDEPENDENT BUSINESS VALUER

37.1 Interests of DBS as Sole Issue Manager, Joint Financial Adviser and Joint Placement
Agent
DBS and its affiliates are full service financial institutions engaged in various activities,
which may include securities trading, commercial and investment banking, investment andasset management, investment research, principal investment, hedging, financing andbrokerage activities and/or other commercial transactions, including holding treasury
investments for their own account.

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LETTER TO SHAREHOLDERS
DBS and certain of its affiliates may have, from time to time, performed and may, in the
future, engage in transactions with and/or performed one or more of the abovementioned
services for the Company and/or Target Group and our affiliates in the ordinary course ofbusiness for which they received or will receive customary fees and expenses. DBS andcertain of its affiliates may also, from time to time, trade in our securities (including holdingtreasury investments for their own account, make co-investments with funds managed bythem or their affiliates), manage funds which invest or trade in our securities and/or engage
in other transactions with the Company and/or Target Group, and our affiliates in theordinary course of business. It is expected that DBS and its affiliates will continue to provide
such services to, and enter into such transactions with our Enlarged Group and our affiliates
in the future.
In the reasonable opinion of the Directors, DBS does not have a material relationship with
the Company and/or the Target Company, save that it is the Sole Issue Manager and oneof the Joint Financial Advisers to the Company in respect of the Proposed Transactions andone of the Joint Placement Agents in respect of the PIPE Financing.
37.2 Interests of UBS as Joint Financial Adviser and Joint Placement Agent
UBS and its affiliates have, from time to time, engaged in transactions with, and/or
performed services for any member of the Company and/or the Target Group, its affiliates
and/or Shareholders in the ordinary course of business and have engaged, and may in the
future engage, in commercial banking, lending or investment banking transactions and/or
other commercial transactions for which they have received or made payment of, or may inthe future receive or make payment of, customary fees. In addition, UBS may, from time totime, be appointed as placement agent and/or underwriter for equity fundraising exercises
conducted by the Enlarged Group. Such roles, if any, will not be contingent andinter-conditional on UBS’s appointment as Joint Financial Advisers. Details of any such
equity fundraising will be included in a separate offering document to be issued inconnection with such equity fundraising if and when it is undertaken.
UBS and its affiliates have engaged in, and may in the future engage in, a broad array ofinvestments and actively trade debt and equity securities (or related derivative securities)
and financial instruments (including bank loans) for their own account and for the accountsof their customers in the ordinary course of business, and such investment and securities
activities may involve securities and instruments of the Enlarged Group. However, UBS and
its affiliates do not have an exclusive relationship with the Company or the Target Group.
UBS and its affiliates may also make investment recommendations and/or publish or
express independent research views in respect of such securities or instruments and may
at any time hold, or recommend to the clients that it acquires, long and/or short positions
in such securities and instruments.
In the reasonable opinion of the Directors, UBS does not have a material relationship with
the Company and/or the Target Company, save that UBS Group AG, as at the Latest
Practicable Date, is a Substantial Shareholder of the Company holding an aggregateinterest of approximately 9.93% in the Company, and UBS is one of the Joint Financial
Advisers to the Company in respect of the Proposed Transactions and one of the Joint
Placement Agents in respect of the PIPE Financing.

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LETTER TO SHAREHOLDERS
37.3 Interests of Frost & Sullivan Limited as Independent Business Valuer
In the reasonable opinion of the Directors, Frost & Sullivan Limited does not have a material
relationship with the Company and/or the Target Company, save that it is the Independent
Business Valuer to the Company.
38.

INTERESTS OF EXPERTS
None of the experts named in this Circular is employed on a contingent basis by theCompany, the Target Company and/or any of the Target Company’s subsidiaries, or has amaterial interest, whether direct or indirect, in the Shares and/or the shares of the Target
Company and/or any of the Target Company’s subsidiaries, or has a material economic
interest, whether direct or indirect, in the Company, the Target Company and/or any of theTarget Company’s subsidiaries, including an interest in any of the Proposed Transactions.

39.

ABSTENTION FROM VOTING
Proposed Adoption of the Company ESOP
Shareholders who are eligible to participate in the Company ESOP must abstain from voting
on any Shareholders’ resolution relating to the Company ESOP, including any
Shareholders’ resolution relating to the implementation of the Company ESOP, or the
making of offers and grants of options under the Company ESOP at a discount notexceeding the maximum discount, or the participation by and grant of options under theCompany ESOP to Controlling Shareholders and/or their Associates, and should not accept
nominations as proxy or otherwise for voting unless specific instructions have been givenin the proxy form on how the vote is to be cast.
Proposed Adoption of the Executive Incentive Scheme
Shareholders who are eligible to participate in the EIS must abstain from voting on any
Shareholders’ resolution relating to the EIS, including any Shareholders’ resolution relating
to the implementation of the EIS, and should not accept nominations as proxy or otherwise
for voting unless specific instructions have been given in the proxy form on how the vote is
to be cast.

40.

DIRECTORS’ RECOMMENDATIONSHaving considered and reviewed, amongst others, the terms of the Sale and Purchase
Agreement, the rationale for and the financial effects of the Proposed Transactions, the risk
factors and other investment considerations, and all other relevant facts set out in thisCircular, the Board is of the opinion that the Proposed Transactions are in the best interestsof the Company and accordingly recommend that Shareholders vote in favour of all of theresolutions as set out in the Notice of EGM.

41.

EXTRAORDINARY GENERAL MEETING
The EGM, notice of which accompanies this Circular, will be held at Raffles City Convention
Centre, Level 4, Bras Basah Room, 80 Bras Basah Road, Singapore 189560 on
1 December 2023 at 2.00 p.m. for the purpose of considering, and if thought fit, passing withor without any modifications, the resolutions as set out in the Notice of EGM.

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LETTER TO SHAREHOLDERS
42.

IMPORTANT NOTICE TO SHAREHOLDERS AND ACTIONS TO BE TAKEN

42.1 Actions to be Taken
Printed Copies of Circular, Gatefold, Notice of EGM, Proxy Form, Share Redemption
Form, Request Form and Shareholder Letter
The Circular, the Gatefold, the Notice of EGM, the Proxy Form, the Share Redemption
Form, the Request Form and the Shareholder Letter have been sent to Shareholders byelectronic means via publication on SGXNET and the Company’s corporate website at the
URL https://www.vertexspac.com/announcements. Printed copies of the Gatefold, theNotice of EGM, the Proxy Form, the Share Redemption Form, the Request Form and theShareholder Letter will be sent to Shareholders. Printed copies of the Circular will NOT be
sent to Shareholders.
A Shareholder may request for a printed copy of the Circular by completing the Request
Form and submitting it:(2)

by post to the Share Registrar’s office at Boardroom Corporate & Advisory Services
Pte. Ltd., 1 Harbourfront Avenue, Keppel Bay Tower #14-07, Singapore 098632; or(3)

by email to the Share Registrar, Boardroom Corporate & Advisory Services Pte. Ltd.
at srs.teamd@boardroomlimited.com,

in each case by no later than 2.00 p.m. on 29 November 2023.
The printed copy of the Circular will be mailed to the Shareholder within 14 Business Days
upon receipt of such request.
Shareholders who are Depositors
Appointment of Proxies
In accordance with the Memorandum and Articles of Association, unless CDP specifies
otherwise in a written notice to the Company, CDP shall be deemed to have appointed as
CDP’s proxies, each of the depositors (whether individual or corporate) and whose names
are shown in the records of CDP, as at a time not earlier than 48 hours prior to the time of
the EGM, supplied by CDP to the Company. Therefore, depositors can attend and vote at
the general meetings of the Company without the lodgement of the Proxy Form. Depositors(whether individuals or corporates) who cannot attend the EGM may enable their nominees
to attend as CDP’s proxies by completing and returning the Proxy Form.
The instrument appointing a proxy or proxies or corporate representative(s) (i.e. the Proxy
Form) must be submitted in the following manner:(a)

if submitted by post, be lodged at the Share Registrar’s office at Boardroom Corporate& Advisory Services Pte. Ltd., 1 Harbourfront Avenue, Keppel Bay Tower #14-07,
Singapore 098632; or(b)if submitted electronically, be submitted via email to the Share Registrar at
srs.teamd@boardroomlimited.com,

in each case by no later than 2.00 p.m. on 29 November 2023.

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LETTER TO SHAREHOLDERS
The Proxy Form must be executed under the hand (or if submitted electronically via email,by way of affixation of an electronic signature) of the appointor or of his or her attorney duly
authorised in writing. Where the Proxy Form is executed by a corporation, it must be
executed either under its seal or under the hand (or if submitted electronically via email, by
way of affixation of an electronic signature) of an officer or attorney duly authorised. Where
the Proxy Form is executed by an attorney on behalf of the appointor, the letter or powerof attorney or a duly certified copy thereof (failing previous registration with the Company),must be lodged with the Proxy Form (if the Proxy Form is submitted by post) or be emailed
with the Proxy Form (if the Proxy Form is submitted electronically via email), failing which
the Proxy Form may be treated as invalid.
The Company shall be entitled to reject a Proxy Form which is incomplete, improperly
completed or illegible or where the true intentions of the appointor are not ascertainablefrom the instructions of the appointor specified on the Proxy Form (including any related
attachment). In addition, in the case of Shares entered in the depository register, theCompany may reject a Proxy Form if the Shareholder, being the appointor, is not shown tohave Shares entered against his/her/its name in the depository register as at 48 hours
before the time appointed for holding the EGM, as certified by CDP to the Company.
A Shareholder (whether individual or corporate) who is not a relevant intermediary(as defined under Section 181 of the Singapore Companies Act), is entitled to appoint not
more than two proxies in his/her/its stead. A proxy need not be a Shareholder. Where a
Shareholder appoints two proxies and does not specify the number of Shares to be
represented by each proxy, then the proxy whose name appears second shall be deemed
to be nominated in the alternate.
As an alternative, Shareholders (whether individuals or corporates) may also appoint the
Chairman of the EGM as his/her/its proxy to vote on their behalf. Such Shareholders will
have to submit the Proxy Form appointing the Chairman of the EGM to vote on their behalf.
All votes on the resolutions tabled at the EGM will be voted by proxy on a one share, one
vote basis. All resolutions tabled at the EGM would be voted by poll and counted based on
the Proxy Forms that were submitted to the Company at least 48 hours before the EGM,
either by post or via email. An independent scrutineer firm is also appointed to validate thevotes for the EGM. The results of all votes for and against each resolution are tallied andinstantaneously displayed at the EGM. The voting results will be announced via SGXNET
following the EGM.
When a Depositor is Regarded as a Shareholder
A depositor shall not be regarded as a Shareholder entitled to attend and vote at the EGM
and his/her/its Proxy Form may be rejected by the Company unless he/she/it is shown tohave Shares entered against his/her/its name in the depository register, as certified by the
CDP, at least 48 hours before the EGM.

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LETTER TO SHAREHOLDERS
Personal Attendance at the EGM
Shareholders, or where applicable, their appointed proxy(ies) who wish to attend the EGM
are required to note the following:
Registration
Shareholders will first need to register personally at the registration counter(s) outside theEGM venue on the day of the event, and should bring along their NRIC/passport to enable
the Company to verify their identity for entry to, and (where applicable) be provided with ahandheld device for electronic voting at, the EGM.
For the avoidance of doubt, Shareholders are not required to pre-register themselves or,where applicable, their appointed proxy(ies), for the EGM.
Registration will commence at 1.00 p.m. on 1 December 2023. Shareholders are advised
not to attend the EGM if they are feeling unwell.
Raising Questions
Shareholders, or where applicable, their appointed proxy(ies), can ask the Chairman of the
EGM substantial and relevant questions related to the resolutions to be tabled for approvalat the EGM, live at the EGM.
Voting at the EGM
Live voting will be conducted during the EGM for Shareholders, or where applicable, their
appointed proxy(ies) attending the EGM.
SRS InvestorsSRS Investors may (a) vote at the EGM if they are appointed as proxies by their respective
SRS Operators, and should contact their respective SRS Operators if they have any queries
regarding their appointment as proxies; or (b) specify their voting instructions to theirrespective SRS Operators or arrange for their votes to be submitted with their respective
SRS Operators, and should approach their respective SRS Operators as soon as possible
and by the time and date as specified by their respective SRS Operators to ensure theirvotes are submitted.
Relevant Intermediaries
Shareholders who hold their Shares through a relevant intermediary (as defined under
Section 181 of the Singapore Companies Act), and who wish to attend the EGM, should
approach their respective relevant intermediaries through which they hold such Shares assoon as possible in order to make the necessary arrangements for them to participate in the
EGM.

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LETTER TO SHAREHOLDERS
42.2 Redemption
Redemption Right
Prior to the EGM to approve the Proposed Business Combination, Shareholders (save for
Vertex SPV and Venezio) will have the opportunity to elect to redeem all or a portion of their
Shares at a per-Share price equal to the Redemption Price (the “Redemption Right”).
Shareholders (other than the Sponsor, the Management Team and their respective
Associates), together with any Associates or persons acting jointly or in concert, may
exercise a Redemption Right of up to a maximum limit of 15% of the Shares in theaggregate at the point of Redemption (the “Redemption Limit”). Notwithstanding theabove, Shareholders (other than the Sponsor, the Management Team and their respective
Associates), together with any Associates or persons acting jointly in concert, may exercise
a Redemption Right beyond the Redemption Limit with the Company’s prior consent, taking
into account, among others: (a) the prevailing circumstances in respect of the Proposed
Business Combination; (b) the intended capital structure of the Resulting Issuer; and (c) the
intended shareholding mix of the Resulting Issuer. The rationale for the Company’s consent
to be procured before the exercise of the Redemption Right beyond the Redemption Limit
is to afford the Company with flexibility to commercially determine the appropriateness ofestablishing the Redemption Limit based on the prevailing circumstances above.
Shareholders (other than the Sponsor, the Management Team and their respective
Associates) who wish to exercise a Redemption Right beyond the Redemption Limit should
submit the Share Redemption Form indicating the total number of Shares that they wish toredeem. The Company shall be deemed to have given its consent to the Redemption
beyond the Redemption Limit if all the Shares tendered for Redemption (including such
Shares in excess of the Redemption Limit) are debited from the Redeeming Shareholders’
Securities Accounts and the Company makes payment of the Redemption Price in respectof all the Shares tendered for Redemption (including such Shares in excess of the
Redemption Limit) to the relevant Redeeming Shareholders on the Redemption Payment
Date. The Company shall not be required to separately notify such Redeeming
Shareholders of its consent. Where the Company does not consent to the Redemption
beyond the Redemption Limit, the Company shall debit from the Redeeming Shareholders’
Securities Accounts such number of Shares up to the Redemption Limit and make paymentof the Redemption Price in respect of such number of Shares up to the Redemption Limit
to the relevant Redeeming Shareholders on the Redemption Payment Date. The Company
shall not be required to separately notify such Redeeming Shareholders that it has notconsented to the exercise of the Redemption Right beyond the Redemption Limit. There isno threshold on the aggregate percentage of Shares owned by Redeeming Shareholders
beyond which the Company will not proceed with Completion of the Proposed Business
Combination.
Shareholders may elect to redeem all or a portion of their Shares irrespective of whether
they vote for or against the Proposed Business Combination at the EGM. Each Redeeming
Share issued and outstanding immediately prior to the Completion Date will automaticallybe cancelled and cease to exist and will thereafter represent only the right to be paid theRedemption Price.

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LETTER TO SHAREHOLDERS
Shareholders who elect to redeem all or a portion of their Shares will not have any
right to receive the Special Bonus NRS Shares and the Additional Warrants in respectof the Shares that they have elected to redeem. Shareholders who wish to redeem a
portion of their Shares should continue to complete and return the Share Redemption
Form, and indicate the number of Shares that they wish to redeem.
Shareholders who wish to receive the Special Bonus NRS Shares and the Additional
Warrants should NOT complete and return the Share Redemption Form.
Election Period
Shareholders may elect to redeem their Shares during the Election Period which starts on
9 November 2023, being the date of the Notice of EGM, and ends on 28 November 2023
at 2.00 p.m., being 72 hours prior to the commencement of the EGM.
The Election Period is scheduled to end 72 hours prior to the commencement of the EGM
to provide sufficient time for the relevant operational processes in relation to the
Redemption to take place. After the Election Period ends, the Share Registrar shall(a) collate the total number of Shares tendered for Redemption and inform the Company of
the indicative number of Shares tendered for Redemption, (b) provide the relevant
information to the CDP for the purposes of validation and earmarking in CDP’s system toblock the Redeeming Shares from trading and (c) check and verify the earmarking results
file sent by the CDP, obtain the relevant confirmation from the CDP and ensure that the
Redeeming Shares have been blocked accurately prior to the Company’s announcement of
the total number of Redeeming Shares at the EGM. The Company will announce the total
number of Redeeming Shares at the EGM (i.e. the level of Redemption) at the EGM.
Procedure to Elect for Redemption
Shareholders who are Depositors
Shareholders who wish to redeem part or all of their Shares must:(a)complete the Share Redemption Form in accordance with the instructions printed
thereon (and, in the case of joint holders, signed by all the joint holders to which it
relates, and in the case of a holder or a joint holder which is a body corporate, signed
on its behalf by one of its directors or a duly authorised signatory) in respect of partor all of the Shares registered in their names; and(b)lodge the duly completed and executed Share Redemption Form at the Share
Registrar’s office at Boardroom Corporate & Advisory Services Pte. Ltd.,
1 Harbourfront Avenue, Keppel Bay Tower #14-07, Singapore 098632 during theElection Period but in any event so as to reach the above address by not later than
2.00 p.m. on 28 November 2023, being the end of the Election Period. The Share
Redemption Form will only be valid if, among others, the relevant Shareholder duly
completing and delivering it in accordance with the instructions therein is a registered
Shareholder as at the end of the Election Period. No acknowledgement of receipt of
any Share Redemption Form will be given.

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LETTER TO SHAREHOLDERS
A Share Redemption Form which is completed and returned may not be amended,
withdrawn or revoked. All requests for Redemption, once made through the completion andreturn of the Share Redemption Form, are final, regardless of whether the Election Period
has ended or not.
The Company reserves the right to reject any Share Redemption Form which it determines
to not be duly completed or executed in accordance with the instructions therein, or
containing inaccurate, incorrect, invalid or incomplete information or illegible writing, orotherwise not valid in accordance with the terms of the Redemption Right as set out in thisCircular or the Mainboard Rules. In that case, the relevant Shareholder will not receive theRedemption Price in respect of the Shares he/she/it has elected to redeem. None of theCompany or the Share Registrar is obliged to return the Share Redemption Form to such
Shareholder or give notice to any Shareholder of the rejection of any Share Redemption
Form and each of them hereby disclaims any and all liabilities arising from not giving such
notification.
Any Shareholder who holds Shares as a nominee, trustee or registered Shareholder in any
other capacity will not be treated differently from any other registered Shareholder. A
beneficial owner whose Shares are registered in the name of a registered Shareholder andwho wishes to exercise the Redemption Right should contact such registered Shareholder
to give instructions to and to make arrangements with such registered Shareholder as to theelection.
For the avoidance of doubt, the Share Redemption Form is not for use as a form of proxyor otherwise at the EGM. The Proxy Form must be used for the purpose of voting on therelevant resolutions to approve the Proposed business Combination at the EGM.
Shareholders who have sold or transferred all of their Shares held through the CDP need
not forward this Circular and the accompanying Proxy Form and the Share Redemption
Form to the purchaser or transferee as arrangements will be made by the CDP for aseparate Circular and the accompanying Proxy Form and the Share Redemption Form to besent to the purchaser or transferee. Copies of the Proxy Form and the Share Redemption
Form can also be obtained from the Share Registrar during usual business hours on any
Market Day until the end of the Election Period.
SRS InvestorsSRS Investors who wish to exercise their Redemption Right should approach theirrespective SRS Operators as soon as possible and by the time and date as specified bytheir respective SRS Operators. The Share Redemption Form will only be accepted andprocessed by the Company provided that the name as stated in the Share Redemption
Form is reflected as a Shareholder in the CDP register as at 2.00 p.m. on 28 November
2023.

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LETTER TO SHAREHOLDERS
Relevant Intermediaries
Shareholders who hold their Shares through a relevant intermediary (as defined under
Section 181 of the Singapore Companies Act) and who wish to exercise their Redemption
Right should approach their respective relevant intermediaries through which they holdsuch Shares as soon as possible by the date and time as specified by such relevantintermediaries. The Share Redemption Form will only be accepted and processed by theCompany provided that the name as stated in the Share Redemption Form is reflected asa Shareholder in the CDP register by 2.00 p.m. on 28 November 2023.
Redemption Price
The Redemption price, payable in cash, will be equal to the aggregate amount on depositin the Escrow Account calculated as of two Market Days before Completion, includinginterest earned on the funds held in the Escrow Account and not previously released to theCompany to pay the Company’s income taxes or operating expenses, if any, but net of any
taxes payable on the interest earned on the funds held in the Escrow Account, divided by
the number of outstanding Shares as at the date falling two Market Days before Completion(which for the avoidance of doubt, includes the Shares held by Venezio and the Sponsor but
does not include the Promote Shares) (the “Redemption Price”). The Redemption Pricewill in any case be no less than S$5.00 per Share, being the price at which the Shares were
issued pursuant to the Company’s initial public offering.
If, at the time the Redemption Price is calculated, there is interest or other income in the
Escrow Account, and such amounts have not been released from the Escrow Account to
pay the Company’s income taxes and operating expenses as permitted by the Mainboard
Rules, the Shareholders will be entitled to a pro rata share of such amounts (net of any
taxes payable on the interest earned on the funds held in the Escrow Account, if any). Thismay have the effect of increasing the per-Share Redemption Price to an amount higher than
S$5.00.
As at the Latest Practicable Date, the total amount of tax payable by the Company on theinterest earned on the funds held in the Escrow Account is S$552,780. This amount will befully paid out of the interest earned on the funds held in the Escrow Account. Based on the
LPD Remaining Escrow Amount and the estimated interest income that will be earned on
the funds held in the Escrow Account, less the taxes payable on the interest earned on thefunds held in the Escrow Account and operating expenses including any transaction-related
costs incurred in connection with the Proposed Business Combination in the period leading
up to Completion, as at the Latest Practicable Date, the Company estimates that the
Redemption Price will be in the range of S$5.00 to S$5.02 per Share. The actual
Redemption Price will be determined two Market Days before Completion and announced
by the Company on SGXNET.
Completion of Redemption and Payment of Redemption Price
Redemption is expected to be completed on 8 December 2023 (the “Redemption
Completion Date”). On the Redemption Completion Date, the Redeeming Shares will bedebited from the Redeeming Shareholders’ Securities Accounts and the Company will makepayment of the Redemption Price to the Redeeming Shareholders through CDP channels.

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LETTER TO SHAREHOLDERS
Procedures for Non-Redeeming Shareholders
The proposed allotment and issuance of the Special Bonus NRS Shares and Additional
Warrants are only available to Non-Redeeming Shareholders (including Venezio) who are
not Non-Qualifying Shareholders as at the Redemption Record Date. Fractional
entitlements to the Special Bonus NRS Shares and Additional Warrants will be disregarded
and will not be allotted to Non-Redeeming Shareholders (including Venezio) who are not
Non-Qualifying Shareholders as at the Redemption Record Date and shall be dealt with inany such manner as the Directors may, in their absolute discretion, deem fit.
Printed copies of the Gatefold, the Notice of EGM, the Proxy Form, the Share Redemption
Form, the Request Form and the Shareholder Letter WILL NOT BE sent to Overseas
Shareholders.
If it is practicable to do so, the Company may, at its absolute discretion, arrange for theSpecial Bonus NRS Shares and/or Additional Warrants which would otherwise have beenallotted to the Non-Qualifying Shareholders to be sold on the SGX-ST as soon aspracticable after Completion by a broker to be appointed by the Company. Such sales may,
however, only be effected if the Company, in its absolute discretion, determines that a
premium can be obtained from such sales, after taking into account the expenses expected
to be incurred in relation thereto.
The net proceeds from all such sales, after deduction of all expenses therefrom, will bepooled and thereafter distributed to the Non-Qualifying Shareholders in proportion to theirrespective shareholdings, or as the case may be, the number of Shares entered against
their names in the Register of Members as at the Redemption Record Date and disbursed
to them AT THEIR OWN RISK, provided that where the amount of net proceeds to be
disbursed to any single Non-Qualifying Shareholder or persons acting to the account or
benefit of any such persons is less than S$10.00, the Company shall be entitled to retain
or deal with such net proceeds as the Directors may, in their absolute discretion, deem fit
in the interests of the Company and no Non-Qualifying Shareholder or persons acting to theaccount or benefit of any such persons shall have any claim whatsoever against theCompany, the Resulting Issuer, the Sole Issue Manager, the Joint Financial Advisers, CDP
or the Share Registrar or any of their respective officers in connection therewith.
Where such Special Bonus NRS Shares and/or Additional Warrants are sold on the
SGX-ST, they will be sold at such price or prices as the Company may, in its absolute
discretion, decide and no Non-Qualifying Shareholder or persons acting to the account or
benefit of any such persons shall have any claim whatsoever against the Company, theResulting Issuer, the Sole Issue Manager, the Joint Financial Advisers, CDP or the Share
Registrar or any of their respective officers in respect of such sales or the proceeds thereof,
the Special Bonus NRS Shares or Additional Warrants.
Shareholders should note that the special arrangements described above will apply only to
Non-Qualifying Shareholders.
For the avoidance of doubt, the Non-Qualifying Shareholders and the Overseas
Shareholders may vote at the EGM unless otherwise specifically set out in this Circular.

386

LETTER TO SHAREHOLDERS“Non-Qualifying Shareholders” refers to those Overseas Shareholder(s) to whom the
Directors, in their sole and absolute discretion, after making enquiries, consider it
necessary, or expedient not to offer the Special Bonus NRS Shares and Additional Warrants
on account of either legal restrictions under the laws of the relevant place or therequirements of the relevant regulatory body or stock exchange in that place, including all
beneficial owners of Shares at the close of business on the Redemption Record Date who
are U.S. Persons.
“Overseas Shareholder(s)” refers to Shareholders with Shares standing to the credit of
their Securities Accounts as at the Redemption Record Date and (a) whose registeredaddress(es) with CDP are not in Singapore as at the Redemption Record Date; (b) who
have not provided CDP with addresses in Singapore for the service of notices anddocuments; or (c) who have provided CDP with addresses in Singapore for the service ofnotices and documents less than three Market Days prior to the Redemption Record Date.
“U.S. Person” includes, but is not limited to: (a) any U.S. citizen; (b) any natural person
resident in the U.S.; (c) any partnership or corporation organised or incorporated under thelaws of the U.S.; (d) any partnership or corporation organised outside the U.S. by a U.S.
Person principally for the purpose of investing in securities not registered under the 1933
Act, unless it is organized or incorporated, and owned, by accredited investors (as definedin Rule 501(a) of the 1933 Act) who are not natural persons, estates or trusts; or (e) any
estate or trust of which any executor or administrator or trustee is a U.S. Person.
Trading Suspension
To provide a record date to differentiate between Redeeming Shareholders and
Non-Redeeming Shareholders who will be entitled to the Special Bonus NRS Shares andthe Additional Warrants based on the Shares held as at the Redemption Record Date, andto prevent disorderly trading in the Company’s counter during the period between thedeadline for the submission of the Share Redemption Form and the date of the EGM, theCompany will undergo a trading suspension commencing on 28 November 2023, 9.00 a.m.
(the “Trading Suspension”). Trading of the Company’s securities on the SGX-ST will
resume on 4 December 2023, 9.00 a.m. after the lifting of the Trading Suspension.
During the Trading Suspension, trading of the Company’s securities will be suspended andall buy/sell orders entered in respect of the Company’s securities will be purged from the
CDP system. Accordingly, Shareholders will not be able to trade on Shares during thisperiod.
Consequences if the Proposed Business Combination is Not Completed
If the Proposed Business Combination is not approved or completed for any reason,
all Redemption requests will be cancelled.
The Company will (i) cease all operations except for the purpose of winding up; (ii) to afford
the Company with sufficient time for liaison with the Escrow Agent and the Share Registrar
and in accordance with applicable law, as promptly as reasonably possible but not morethan 10 Business Days thereafter, redeem the Shares, at a per-Share price, on a pro-ratabasis, payable in cash, equal to the aggregate amount then on deposit in: (a) the Escrow
Account, including interest earned on the funds held in the Escrow Account and notpreviously released to the Company to pay its income taxes or operating expenses, if any(less any liquidation expenses); and (b) such other bank accounts held by the Company,
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LETTER TO SHAREHOLDERS
divided by the number of the then-outstanding Shares (which for the avoidance of doubt,
includes the Shares held by Venezio and the Sponsor but does not include the Promote
Shares), which redemption will completely extinguish Shareholders’ rights as Shareholders(including the right to receive further liquidation distributions, if any); and (iii) as promptly
as reasonably possible following such redemption, subject to the approval of the remaining
Shareholders and the Board of Directors, liquidate and dissolve, subject in the case ofclauses (ii) and (iii), to the Company’s obligations under applicable law to provide for claimsof creditors and the requirements of other applicable law and in accordance with theMemorandum and Articles of Association (the “Liquidation”).There will be no redemption
rights or liquidating distributions with respect to the Company’s Warrants, which will expire
worthless.
42.3 Exercise of Warrants
Each whole Warrant entitles the Warrantholder to purchase one Share at the Warrant
Exercise Price during the Warrant Exercise Period. Converted Shares allotted and issued
upon the exercise of the Warrants shall be fully paid and shall rank pari passu in all respects
with the then existing Shares save for any dividends, rights, allotments and other
distributions the Distribution Record Date for which is before the relevant Exercise Date of
the Warrants. “Distribution Record Date” means, in relation to any dividends, rights,
allotments or other distributions, the date at the close of business on which Shareholders
must be registered in order to participate in such dividends, rights, allotments or other
distributions.
Fractional Warrants to be Disregarded
Pursuant to the Warrant Agreement, a Warrantholder may exercise its Warrants only for awhole number of Shares. This means only a whole Warrant may be exercised at a given
time by a Warrantholder. Fractional Warrants will be disregarded.
Procedure to Exercise the Warrants
Warrantholders who wish to exercise their Warrants for Shares must complete and submit
the applicable Warrant Exercise Form to the Warrant Agent in accordance with the
instructions therein. Copies of the Warrant Exercise Forms (for scripless Warrants andscrip-based Warrants) will be published on the Resulting Issuer’s corporate website
post-Completion.
Please refer to the section titled “Appendix E – Terms and Conditions of the Warrants –Exercise and Exchange of Warrants” of the Prospectus and Section 23.6 titled “Enlarged
Group Corporate and Shareholding Structure – Dilution Effect Resulting from the Proposed
Transactions and the Exercise of the Warrants – Dilution Effect Resulting from the Exerciseof the Warrants” of this Circular for further details.
43.

CONSENTS
DBS Bank Ltd., the Sole Issue Manager and one of the Joint Financial Advisers and the
Joint Placement Agents to the Company, has given and has not withdrawn its writtenconsent to the issue of this Circular with the inclusion herein of its name and all references
thereto in the form and context in which it appears in this Circular and to act in suchcapacities in relation to this Circular.

388

LETTER TO SHAREHOLDERSUBS AG, Singapore Branch, one of the Joint Financial Advisers and Joint Placement Agentsto the Company, has given and has not withdrawn its written consent to the issue of thisCircular with the inclusion herein of its name and all references thereto in the form andcontext in which it appears in this Circular and to act in such capacities in relation to thisCircular.
Eng and Co. LLC, the Legal Adviser to the Company as to Singapore law, has given and has
not withdrawn its written consent to the issue of this Circular with the inclusion herein of its
name and all references thereto, in the form and context in which it appears in this Circularand to act in such capacity in relation to this Circular.
Maples and Calder (Singapore) LLP, the Legal Adviser to the Company as to Cayman
Islands law, has given and has not withdrawn its written consent to the issue of this Circularwith the inclusion herein of its name and all references thereto, in the form and context inwhich it appears in this Circular and to act in such capacity in relation to this Circular.
Nishimura & Asahi (Gaikokuho Kyodo Jigyo) and Nishimura & Asahi (Singapore) LLP, theLegal Advisers to the Company as to Japan law, have given and have not withdrawn theirwritten consent to the issue of this Circular with the inclusion herein of their names and allreferences thereto, in the form and context in which it appears in this Circular and to act insuch capacity in relation to this Circular.
Lin & Partners, Attorneys-at-Law, the Legal Adviser to the Company as to Taiwan law, hasgiven and has not withdrawn its written consent to the issue of this Circular with theinclusion herein of its name and all references thereto, in the form and context in which itappears in this Circular and to act in such capacity in relation to this Circular.
Deacons, the Legal Adviser to the Company as to Hong Kong law, has given and has notwithdrawn its written consent to the issue of this Circular with the inclusion herein of its
name and all references thereto, in the form and context in which it appears in this Circularand to act in such capacity in relation to this Circular.
WongPartnership LLP, the Legal Adviser to the Joint Financial Advisers as to Singapore law,has given and has not withdrawn its written consent to the issue of this Circular with theinclusion herein of its name and all references thereto, in the form and context in which itappears in this Circular and to act in such capacity in relation to this Circular.
Freshfields Bruckhaus Deringer Singapore Pte. Ltd., the Legal Adviser to the Joint Financial
Advisers as to U.S. law, has given and has not withdrawn its written consent to the issueof this Circular with the inclusion herein of its name and all references thereto, in the formand context in which it appears in this Circular and to act in such capacity in relation to thisCircular.
K&L Gates LLP, the Global Lead Counsel to the Target Company as to Hong Kong law,
Japan law, Taiwan law, United States law and Singapore law, has given and has notwithdrawn its written consent to the issue of this Circular with the inclusion herein of its
name and all references thereto, in the form and context in which it appears in this Circularand to act in such capacity in relation to this Circular.
Rajah & Tann Singapore LLP, the Legal Adviser to the Target Company as to Singapore law,has given and has not withdrawn its written consent to the issue of this Circular with the389

LETTER TO SHAREHOLDERS
inclusion herein of its name and all references thereto, in the form and context in which itappears in this Circular and to act in such capacity in relation to this Circular.
Harney Westwood & Riegels, the Legal Adviser to the Target Company as to Cayman
Islands law, has given and has not withdrawn its written consent to the issue of this Circularwith the inclusion herein of its name and all references thereto, in the form and context inwhich it appears in this Circular and to act in such capacity in relation to this Circular.
KPMG LLP, the Independent Auditor to the Company, has given and has not withdrawn its
written consent to the issue of this Circular with the inclusion herein of its name and allreferences thereto, in the form and context in which it appears in this Circular and to act insuch capacity in relation to this Circular.
Ernst & Young LLP, the Independent Auditor and the Reporting Accountant to the 17LIVE
Group, has given and has not withdrawn their written consent to the issue of this Circularwith the inclusion herein of its name, Appendix A titled “Independent Auditor’s Report andAudited Consolidated Financial Statements of the Target Group for the Financial Years
ended 31 December 2020, 2021 and 2022”, Appendix B titled “Interim Consolidated
Financial Statements of the Target Group for the Six-Month Period Ended 30 June 2023”
and Appendix C titled “Unaudited Pro Forma Consolidated Financial Information of theEnlarged Group for the Financial Year Ended 31 December 2022 and the Six-Month Period
Ended 30 June 2023”, and all references thereto in the form and context in which it appears
in this Circular and to act in such respective capacity in relation to this Circular.
Ernst & Young LLP, the Independent Reporting Accountant to the Enlarged Group, hasgiven and has not withdrawn its written consent to the issue of this Circular with theinclusion herein of its name and all references thereto, in the form and context in which itappears in this Circular and to act in such capacity in relation to this Circular.
Frost & Sullivan Limited, the Independent Business Valuer to the Company, has given andhas not withdrawn its written consent to the issue of this Circular with the inclusion hereinof its name, Appendix M titled “Summary Valuation Letter”, and all references thereto, in theform and context in which it appears in this Circular and to act in such capacity in relation
to this Circular.
Frost & Sullivan (Singapore) Pte Ltd, the Independent Market Research Consultant to theTarget Company, has given and has not withdrawn its written consent to the issue of thisCircular with the inclusion herein of its name, Appendix F titled “Independent Market
Research Report”, and all references thereto, in the form and context in which it appears
in this Circular and to act in such capacity in relation to this Circular.
44.

RESPONSIBILITY
DIRECTORSSTATEMENTS

OF

THE

DIRECTORS ANDTHE

PROPOSEDThe Directors collectively and individually accept full responsibility for the accuracy of theinformation given in this Circular in respect of the Company, the Enlarged Group (in so far
as they relate to the Company) and the Proposed Transactions (excluding the information
herein relating to the Target Company and the Vendor) and confirm after making all
reasonable enquiries, that to the best of their knowledge and belief, this Circular constitutes
full and true disclosure of all material facts about the Company, the Enlarged Group (in so
far as they relate to the Company) and the Proposed Transactions (excluding theinformation herein relating to the Target Company and the Vendor), and the Directors are390

LETTER TO SHAREHOLDERS
not aware of any facts the omission of which would make any statement in this Circular
misleading. Where information in this Circular has been extracted from published orotherwise publicly available sources or obtained from a named source, the sole
responsibility of the Directors has been to ensure that such information has been accurately
and correctly extracted from those sources and/or reproduced in this Circular in its proper
form and context.
The Proposed Directors collectively and individually accept full responsibility for theaccuracy of the information given in this Circular in respect of the Vendor, the Target
Company, the Enlarged Group (in so far as they relate to the Target Company) and the
Proposed Transactions (excluding the information herein relating to the Company), andconfirm after making all reasonable enquiries, that to the best of their knowledge and belief,
this Circular constitutes full and true disclosure of all material facts about the Vendor, theTarget Company, the Enlarged Group (in so far as they relate to the Target Company) and
the Proposed Transactions (excluding the information herein relating to the Company), and
the Proposed Directors are not aware of any facts the omission of which would make any
statement in this Circular misleading. Where information in this Circular has been extracted
from, published or otherwise publicly available sources or obtained from a named source,
the sole responsibility of the Proposed Directors has been to ensure that such information
has been accurately and correctly extracted from those sources and/or reproduced in thisCircular in its proper form and context.
45.

RESPONSIBILITY STATEMENT OF THE SOLE ISSUE MANAGER
To the best of the knowledge and belief of the Sole Issue Manager to the Company inrespect of the Proposed Transactions, this Circular constitutes full and true disclosure of allmaterial facts about the Proposed Transactions, the Company, the Target Company and theEnlarged Group, and the Sole Issue Manager is not aware of any facts the omission ofwhich would make any statement in this Circular misleading.

46.

RESPONSIBILITY STATEMENT OF THE SPONSOR
To the best of the knowledge and belief of the Sponsor in respect of the Proposed
Transactions insofar as they relate to the Sponsor, this Circular constitutes full and true
disclosure of all material facts about the Proposed Transactions insofar as they relate to theSponsor, and the Sponsor is not aware of any facts the omission of which would make any
statement in this Circular misleading.

47.

GENERAL AND STATUTORY INFORMATION (INCLUDING MATERIAL BACKGROUNDINFORMATION)
Material Background Information on the Proposed Directors, Proposed Executive
Officers and Controlling Shareholders of the Company
As at the date of this Circular, save as disclosed below, none of the Proposed Directors,
Proposed Executive Officers or Controlling Shareholders has:(a)at any time during the last 10 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
after the date he ceased to be a partner;

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LETTER TO SHAREHOLDERS(b)

at any time during the last 10 years, had an application or a petition under any law ofany 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
after the date he ceased to be a director or an equivalent person or a key executiveof that entity, for the winding up or dissolution of that entity or, where that entity is thetrustee of a business trust, that business trust, on the ground of insolvency;(c)

any unsatisfied judgment against him;(d)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 isaware) for such purpose;(e)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;(f)at any time during the last 10 years, had judgment 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 orelsewhere, or a finding of fraud, misrepresentation or dishonesty on his part, or has
been the subject of any civil proceedings (including any pending civil proceedings ofwhich he is aware) involving an allegation of fraud, misrepresentation or dishonesty on
his part;(g)

ever been convicted in Singapore or elsewhere of any offence in connection with theformation or management of any entity or business trust;(h)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;(i)ever been the subject of any order, judgment or ruling of any court, tribunal or
governmental body permanently or temporarily enjoining him from engaging in any
type of business practice or activity;(j)ever, to his knowledge, been concerned with the management or conduct, in
Singapore or elsewhere, of the affairs of:(i)any corporation which has been investigated for a breach of any law or regulatory
requirement governing corporations in Singapore or elsewhere;(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 orelsewhere;(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

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LETTER TO SHAREHOLDERS(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)ever been the subject of any current or past investigation or disciplinary proceedings,
or been reprimanded or issued any warning, by the Monetary Authority of Singapore
or any other regulatory authority, exchange, professional body or government agency,
whether in Singapore or elsewhere.

The following disclosures are made in relation to the following persons:Dr. Steve Lai Mun Fook
Dr. Steve Lai Mun Fook is a non-executive independent director of Yongmao Holdings
Limited (“Yongmao”), acting as the Chairman of the Nominating Committee, and a memberof the Audit and Remuneration Committees. On 8 September 2022, Yongmao announced
that an accident had occurred in September 2022 involving a tower crane owned by its 60%
owned subsidiary, Yongmao Machinery (H.K.) Company Limited (“YMHK”) in a customer
worksite in Sau Mau Ping, Hong Kong which resulted in the death of three workers andinjured six other workers. The Hong Kong Labour Department is investigating into the causeof the accident and had ordered a cessation of all works at the worksite.
Yongmao also announced on 13 March 2023 that YMHK had received a letter from the
Occupational Safety and Health Branch, Labour Department of Hong Kong indicating that
the Commission for Labour is taking legal action against it for alleged offences under(a) Section 13(1) of the Factories and Industrial Undertakings Ordinance, Cap. 59 (“FIUO”);(b) Regulations 4(b), 4(c), 4(d), 4(e) and 19(a) of the Factories and Industrial Undertakings(Lifting Appliances and Lifting Gear) Regulations made under the Factories and Industrial
Undertakings Ordinance, Cap. 59 (“FIU Regulations”); and (c) Section 7(1)(c) and 7(2) of
the Occupational Safety and Health Ordinance, Cap. 509 (“OSHO”), and YMHK appeared
before the magistrate on 30 June 2023, during which the case was adjourned to
27 September 2023 for mention.
Eastime Engineering Limited (“EEL”), a 100% wholly-owned subsidiary of YMHK and theoperating company and employer of the staff involved in the accident, also received a letterfrom the Occupational Safety and Health Branch, Labour Department of Hong Kong
indicating that the Commission for Labour is taking legal action against it for alleged
offences under (a) Section 6A(1), 6A(2)(a), 6A(2)(c) and 6A(3) of the FIUO; (b) Regulations
4(b), 4(c), 4(d), 4(e) and 19(a) of the FIU Regulations; and (c) Section 7(1)(c) and 7(2) of
the OSHO, and EEL appeared before the magistrate on 30 June 2023, during which thecase was adjourned to 27 September 2023 for mention.
Yongmao announced on 29 September 2023 that YMHK and EEL have appeared before themagistrate on 27 September 2023 and the prosecution has applied for a further
adjournment of the cases without taking a plea, and the cases have been adjourned to
30 January 2024 for mention. Yongmao further announced on 10 October 2023 that YMHK,
EEL and EEL’s project manager have been served with summons to appear before themagistrate on 30 January 2024 to answer to the alleged offences under
Section 40(2B)(a) of the Buildings Ordinance, Cap. 123.

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LETTER TO SHAREHOLDERS
Mr. Akio Tanaka
Mr. Akio Tanaka is the co-founder and Managing Partner of Headline Asia (which wasformerly known as Infinity Ventures) which manages, among others, Infinity e.Ventures Asia
III, L.P. (“IVP Fund III”). He is also an executive director of Infinity e.Ventures Asia III (GP),Ltd. (“IVP Fund III GP”), which is the general partner of IVP Fund III. In May 2019, IVP FundIII lodged a formal complaint with the Regional District Prosecutor’s office against
Mr. Tai-yuan (Popo) Chen, who was the co-founder and Chairman of Cobinhood, Ltd. (which
is one of IVP Fund III’s portfolio companies), for allegations of embezzlement of company
assets, breach of trust through a failure to fulfil his fiduciary responsibilities and deceptive
practices directed at defrauding investors. Following the filing of the formal complaint by
IVP Fund III, Mr. Tai-yuan (Popo) Chen filed counter-complaints against, among others, IVP
Fund III and Mr. Akio Tanaka in May 2019. Following investigations by the District
Prosecutor’s office on such counter-complaints, the counter-complaints were dismissed by
the District Prosecutor’s office in 2022.
Material Contracts
The material contracts entered into by the Company within the two years preceding the dateof issuance of this Circular (not being contracts entered into in the ordinary course of theCompany’s business) are as follows:(a)the Sale and Purchase Agreement;(b)

the Management and Placement Agreement;(c)the Deed of Waiver;(d)the Administrative Services Agreement;(e)the Promote Shares Deed of Undertaking;(f)the Escrow Agreement;(g)the Warrant Agreement; and(h)the Private Placement Warrants Purchase Agreement,

as described in Section 29.2 titled “Material Contracts – The Company” of this Circular;
Litigation
We were not engaged in any legal or arbitration proceedings, including those which are
pending or known to be contemplated, which may have, or which have had in the 12 months
immediately preceding the date of lodgement of this Circular, a material effect on the
Company’s financial position or profitability.

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LETTER TO SHAREHOLDERS
Miscellaneous

48.

(a)

As the Company has no subsidiaries, none of the Company’s independent directors
sits on the board of directors of any such principal subsidiaries based in jurisdictions
outside Singapore.

(b)

There have been no public take-over offers by third parties in respect of the Shares orby the Company in respect of the shares of another corporation or the units of abusiness trust which have occurred between the beginning of the year ended
31 December 2022 and the Latest Practicable Date, save for the Proposed Business
Combination.

(c)

We are not aware of any event which has occurred since 30 June 2023 and up to theLatest Practicable Date, which may have a material effect on the Company’s financial
position and results.

(d)Save as disclosed in this Circular, no person has, or has the right to be given, an
option to subscribe for and/or purchase any securities or securities-based derivatives
contracts of the Company.

DOCUMENTS AVAILABLE FOR INSPECTION
Copies of the following documents may be inspected at the principal place of business of
the Company during normal business hours for a period of six months from the date of thisCircular:(a)the existing Memorandum and Articles of Association and the proposed New
Memorandum and Articles of Association as set out in Appendix D to this Circular;(b)the constitution of the Target Company as of the date of this Circular;(c)the constitution of the Target Company to be adopted upon the completion of the
Restructuring;(d)the material contracts as set out in Section 29 titled “Material Contracts” of thisCircular;(e)the draft employment agreement to be entered into with the Proposed Executive
Director as set out in Section 24.10 titled “Proposed Directors and Executive Officers– Employment Agreements and Indemnification Agreements” of this Circular;(f)

the Independent Auditor’s Report and Audited Consolidated Financial Statements of
the Target Group for the financial years ended 31 December 2020, 2021 and 2022 as
set out in Appendix A to this Circular;(g)

the Interim Consolidated Financial Statements of the Target Group for the Six-Month
Period Ended 30 June 2023 as set out in Appendix B to this Circular;(h)the Unaudited Pro Forma Consolidated Financial Information of the Enlarged Groupfor the Financial Year Ended 31 December 2022 and the Six-Month Period Ended
30 June 2023 as set out in Appendix C to this Circular;

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LETTER TO SHAREHOLDERS(i)the IMR Report as set out in Appendix F to this Circular;(j)

the Summary Valuation Letter as set out in Appendix M to this Circular;(k)the Valuation Report;(l)

the letters of consent described in Section 43 titled “Consents” of this Circular;(m) the Company ESOP Rules as set out in Appendix H to this Circular; and(n)the EIS Rules as set out in Appendix I to this Circular.

Yours faithfully,

For and on behalf of
VERTEX TECHNOLOGY ACQUISITION CORPORATION LTD
Jiang Honghui
Executive Director and Chief Executive Officer

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