SISTEMA DE LLAVE DE TARJETA INTELIGENTE HONDA

In conjunction with our listing on Catalist, we have adopted a performance share plan known as the “Choo Chiang Performance Share Plan” (the “Performance Share Plan”), which was approved by our Shareholders by way of written resolutions passed on 23 June 2015. The rules of our Performance Share Plan are set out in Appendix E of this Offer Document.

The Performance Share Plan will provide eligible participants (each a “Participant” and collectively, the “Participants”) with an opportunity to participate in the equity of our Company and to motivate them towards better performance through increased dedication and loyalty. The Performance Share Plan forms an integral component of our compensation plan and is designed primarily to reward and retain employees whose services are vital to the growth and performance of our Company and/or our Group. The Performance Share Plan allows our Group to provide an incentive for Participants to achieve certain specifi c performance targets by awarding fully paid Shares to Participants after these targets have been met. The assessment criteria for granting of Awards (as described below) under the Performance Share Plan will be based on specifi c performance targets or to impose time-based service conditions, or a combination of both.

As at the date of this Offer Document, no Awards have been granted under the Performance Share Plan.

Objectives of the Performance Share Plan

The main objectives of the Performance Share Plan are as follows:

(a) to attract potential employees with relevant skills to contribute to our Group and to create value for

Shareholders;

(b) to instil loyalty to, and a stronger identifi cation by the Participants with the long-term prosperity of,

our Group;

(c) to motivate the Participants to optimise their performance standards and effi ciency and to maintain

a high level of contribution to our Group;

(d) to give recognition to the contributions made by the Participants to the success of our Group; and

(e) to retain key employees of our Group whose contributions are essential to the long-term prosperity

of our Group.

Summary of the Performance Share Plan

The following is a summary of the rules of the Performance Share Plan. Any capitalised term as used throughout this section, unless otherwise defi ned, shall bear the meanings as defi ned in Appendix E of this Offer Document entitled “Performance Share Plan”.

(a) Eligibility

The Performance Share Plan allows for participation by confi rmed employees of our Group (including Executive Directors) and Non-Executive Directors (including Independent Directors)

There shall be no restriction on the eligibility of any Participant to participate in any other share incentive schemes or share plans implemented or to be implemented by our Company or any other company within our Group.

Subject to the Companies Act and any requirement of the SGX-ST, the terms of eligibility for participation in the Performance Share Plan may be amended from time to time at the absolute discretion of the Remuneration Committee.

(b) Awards

Awards represent the right of a Participant to receive fully paid Shares free of charge, upon the Participant achieving the prescribed performance targets.

The selection of the Participants and the number of Shares which are the subject of each Award to be granted to a Participant in accordance with the Performance Share Plan shall be determined at the absolute discretion of the Remuneration Committee, which shall take into account criteria such as, inter alia, the rank, scope of responsibilities, performance, years of service and potential for future development and contribution to the success of our Group.

In the case of a performance-related Award, the performance targets will be set by the Remuneration Committee depending on each individual Participant’s job scope and responsibilities. The performance targets to be set shall take into account both the medium and long-term corporate objectives of our Group and the individual performance of the Participant and will be aimed at sustaining long-term growth. The corporate objectives shall cover market competitiveness, business growth and productivity growth. The performance targets could be based on criteria such as sales growth, growth in earnings and returns on investment. In addition, the Participant’s length of service with our Group, achievements of past performance targets, ability to value-add to our Group’s performance and development and overall enhancement to Shareholder value, amongst others, will be taken into account.

Awards may be granted at any time in the course of a fi nancial year, provided that in the event that an announcement on any matter of an exceptional nature involving unpublished price sensitive information is imminent, Awards may only be vested and hence any Shares comprised in such Awards may only be delivered on or after the second Market Day from the date on which the aforesaid announcement is made.

An Award letter confi rming the Award will be sent to each Participant as soon as reasonably practicable after the Award is fi nalised, specifying, inter alia, in relation to the Award:

(a) (in relation to a performance-related Award), the performance targets and the performance

period during which the prescribed performance targets are to be met;

(b) the number of Shares to be vested on the Participant; and

(c) the date by which the Award shall be vested.

The Remuneration Committee will take into account various factors when determining the method to arrive at the exact number of Shares comprised in an Award. Such factors include, but are

(c) Size and duration of the Performance Share Plan

The total number of Shares which may be delivered pursuant to the vesting of Awards on any date, when added to the aggregate number of Shares issued and/or issuable in respect of (i) all Awards granted under the Performance Share Plan; and (ii) all other Shares issued and/or issuable under any other share-based incentive schemes or share plans of our Company, shall not exceed 15.0% of the total number of issued Shares (including treasury shares) of our Company from time to time. Our Directors believe that the size of the Performance Share Plan will give our Company suffi cient fl exibility to decide the number of Shares to be offered under the Performance Share Plan. However, it does not indicate that the Remuneration Committee will defi nitely issue Shares up to the prescribed limit. The Remuneration Committee will exercise its discretion in deciding the number of Shares to be granted to each Participant under the Performance Share Plan. This, in turn, will depend on, and be commensurate with, the performance and value of the Participant to our Group.

The aggregate number of Shares that are available to the Controlling Shareholders and their associates under the Performance Share Plan shall not exceed 25.0% of the total number of Shares available under the Performance Share Plan. The number of Shares that are available to each Controlling Shareholder or each of their Associates under the Performance Share Plan shall not exceed 10.0% of the Shares available under the Performance Share Plan.

The Performance Share Plan shall continue in force at the discretion of the Remuneration Committee, subject to a maximum period of ten (10) years commencing on the date on which the Performance Share Plan is adopted by our Company in general meeting, provided always that the Performance Share Plan may continue beyond the above stipulated period with the approval of our Shareholders by ordinary resolution in general meeting and of any relevant authorities which may then be required.

Notwithstanding the expiry or termination of the Performance Share Plan, any Awards made to Participants prior to such expiry or termination will continue to remain valid.

(d) Operation of the Performance Share Plan

The Remuneration Committee shall have the discretion to determine whether performance targets have been met (whether fully or partially) or exceeded and/or whether the Participant’s performance and/or contribution to our Company and/or any of our subsidiaries justifi es the vesting of an Award. In making any such determination, the Remuneration Committee shall have the right to make reference to the audited results of our Company or our Group, as the case may be, to take into account such factors as the Remuneration Committee may determine to be relevant, such as changes in accounting methods, taxes and extraordinary events, and further, the right to amend the performance targets if the Remuneration Committee decides that it would be a fairer measure of performance.

Awards may only be vested and consequently any Shares comprised in such Awards shall only be delivered upon the Remuneration Committee being satisfi ed that the Participant has achieved the performance targets.

Subject to the prevailing legislation and the provisions of the Catalist Rules, our Company will be delivering Shares to Participants upon vesting of their Awards by way of an issue of New Shares or

(e) Adjustments and alterations under the Performance Share Plan

(i) Variation of Capital

If a variation in the issued ordinary share capital of our Company (whether by way of a capitalisation of profi ts or reserves or rights issue, capital reduction, subdivision, consolidation, distribution or otherwise) shall take place, then:

(A) the class and/or number of Shares which are the subject of an Award to the extent not

yet vested; and/or

(B) the class and/or number of Shares over which future Awards may be granted under

the Performance Share Plan,

shall be adjusted by the Remuneration Committee to give each Participant the same proportion of the equity capital of our Company as that to which he was previously entitled and, in doing so, the Remuneration Committee shall determine, at its own discretion, the manner in which such adjustment shall be made.

Unless the Remuneration Committee considers an adjustment to be appropriate, the following events shall not normally be regarded as a circumstance requiring adjustment:

(A) the issue of securities as consideration for an acquisition or a private placement of

securities;

(B) the cancellation of issued Shares purchased or acquired by our Company by way of a

market purchase of such Shares undertaken by our Company on the SGX-ST during the period when a share purchase mandate granted by Shareholders (including any renewal of such mandate) is in force;

(C) the issue of Shares or other securities convertible into or with rights to acquire or

subscribe for Shares to its employees pursuant to any share option scheme or share plan approved by Shareholders in general meeting, including the Performance Share Plan; and

(D) any issue of Shares arising from the exercise of any warrants or the conversion of any

convertible securities issued by our Company.

Notwithstanding the provisions of the rules of the Performance Share Plan:

(A) the adjustment must be made in such a way that a Participant will not receive a

benefi t that a Shareholder does not receive; and

(B) any adjustment (except in relation to a capitalisation issue) must be confi rmed in

writing by the Auditors (acting only as experts and not as arbitrators) to be in their opinion, fair and reasonable.

(f) Reporting requirements

Under the Catalist Rules, an immediate announcement must be made on the date of the grant of an Award and provide details of the grant, including the following:

(i) date of grant;

(ii) market price of the Shares on the date of grant of the Award;

(iii) number of Shares granted under the Award;

(iv) number of Shares granted to Directors under the Award, if any; and

(v) the vesting period in relation to the Award.

The following disclosures (as applicable) will be made by our Company in our annual report for so long as the Performance Share Plan continues in operation:

(A) the names of the members of the Remuneration Committee administering the Performance

Share Plan;

(B) in respect of the following Participants:

(1) Directors of our Company; and

(2) Participants (other than those in paragraph (B)(1) above) who have received Shares

pursuant to the vesting of Awards granted under the Performance Share Plan which, in aggregate, represent fi ve per cent. (5%) or more of the total number of Shares available under the Performance Share Plan,

the following information will be required: (AA) the name of the Participant;

(BB) the aggregate number of Shares comprised in Awards which have been granted to

such Participant during the fi nancial year under review;

(CC) the aggregate number of Shares comprised in Awards which have been granted to

such Participant since the commencement of the Performance Share Plan to the end of the fi nancial year under review;

(DD) the aggregate number of Shares comprised in Awards which have been issued

and/or transferred to such Participants pursuant to the vesting of Awards under the Performance Share Plan since the commencement of the Performance Share Plan to the end of the fi nancial year under review; and

(EE) the aggregate number of Shares comprised in Awards which have not been vested as at the end of the fi nancial year under review; and

The Remuneration Committee shall have the power, from time to time, to make and vary such rules (not being inconsistent with the Performance Share Plan) for the implementation and administration of the Performance Share Plan as they think fi t including, but not limited to:

(i) imposing restrictions on the number of Awards that may be vested within each fi nancial year; and

(ii) amending performance targets, if by so doing it would be a fairer measure of performance for a

Participant or for the Performance Share Plan as a whole.

In compliance with the requirements of the Catalist Rules, any Participant of the Performance Share Plan who is a member of the Remuneration Committee shall not be involved in the deliberation or decision in respect of Awards granted to or to be granted to him.

Rationale for participation by the Controlling Shareholders and their Associates in the Performance Share Plan

Our Company acknowledges that the services and contributions of employees who are Controlling Shareholders or Associates of our Controlling Shareholders are important to the development and success of our Group. The extension of the Performance Share Plan to confi rmed full-time employees who are Controlling Shareholders and Associates of our Controlling Shareholders allows our Group to have a fair and equitable system to reward employees who have actively contributed to the progress and success of our Group. The participation of the Controlling Shareholders and their Associates in the Performance Share Plan will serve both as a reward to them for their dedicated services to our Group and a motivation for them to take a long-term view of our Group.

Although Participants who are Controlling Shareholders or Associates of our Controlling Shareholders may already have shareholding interests in our Company, the extension of the Performance Share Plan to include them ensures that they are equally entitled, with the other employees of our Group, who are not Controlling Shareholders or Associates of our Controlling Shareholders, to take part and benefi t from this system of remuneration. We are of the view that a person who would otherwise be eligible should not be excluded from participating in the Performance Share Plan solely by reason that he is a Controlling Shareholder or an Associate of our Controlling Shareholders.

The specifi c approval of our independent Shareholders is required for the participation of such persons as well as the actual number of and terms of such Awards. A separate resolution must be passed for each of such Participant. In seeking such approval from our independent Shareholders, clear justifi cation as to the participation of our Controlling Shareholders and their Associates, the number of and terms of the Awards to be granted to the Controlling Shareholders and their Associates shall be provided. Accordingly, we are of the view that there are suffi cient safeguards against any abuse of the Performance Share Plan resulting from the participation of employees who are Associates of our Controlling Shareholders.

Rationale for participation by Non-Executive Directors (including Independent Directors)

While the Performance Share Plan caters principally to Group Employees, it is recognised that there are other persons who make signifi cant contributions to our Group through their close working relationships with our Group, even though they are not employed within our Group. Such persons include the Non- Executive Directors.

Our Directors are of the view that including the Non-Executive Directors in the Performance Share Plan will show our Company’s appreciation for them and further motivate them in their contribution towards the success of our Group. However, as their services and contributions cannot be measured in the same way as the full-time employees of our Group, while it is desired that participation in the Performance Share Plan be made open to the Non-Executive Directors, any Awards that may be granted to any such Non- Executive Director would be intended only as a token of our Company’s appreciation.

For the purpose of assessing the contributions of the Non-Executive Directors, the Remuneration Committee will propose a performance framework comprising mainly non-financial performance measurement criteria, such as the extent of involvement and responsibilities shouldered by the Non- Executive Directors. In addition, the Remuneration Committee will also consider the scope of advice given, the number of contacts and size of deals which our Group is able to procure from those contacts and recommendations made by the Non-Executive Directors. The Remuneration Committee may also decide that no Awards shall be made in any fi nancial year or no grant and/or Award may be made at all. It is envisaged that the vesting of Awards, and hence the number of Shares to be delivered to the Non- Executive Directors based on the criteria set out above will be relatively small, in terms of the frequency and numbers. Based on this, our Directors are of the view that the participation by the Non-Executive Directors in the Performance Share Plan will not compromise the independent status of those who are Independent Directors.

Financial effects of the Performance Share Plan

Cost of Awards

Singapore Financial Reporting Standard 102 (“FRS 102”) relating to share-based payment took effect for all listed companies from 1 January 2005. Participants will receive Shares and the Awards would be accounted for as equity-settled share-based transactions, as described in the following paragraphs.

The fair value of employee services received in exchange for the grant of the Awards will be recognised as a charge to profi t or loss over the period between the grant date and the vesting date of an Award. The total amount of the charge over the vesting period is determined by reference to the fair value of each Award granted at the grant date and the number of Shares vested at the vesting date, with a corresponding credit to reserve account. Before the end of the vesting period, at each accounting year end, the estimate of the number of Awards that are expected to vest by the vesting date is subject to