THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional advisers.

If you have sold or transferred all your shares in Risecomm Group Holdings Limited (the "Company"), you should at once hand this circular together with the accompanying form of proxy to the purchaser or the transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or the transferee.

Hong Kong Exchanges and Clearing Limited, The Stock Exchange of Hong Kong Limited and Hong Kong Securities Clearing Company Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

This circular appears for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for the securities of the Company.

RISECOMM

瑞斯康

RISECOMM GROUP HOLDINGS LIMITED

瑞斯康集團控股有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 1679)

(I) PROPOSED SHARE CONSOLIDATION;

(II) PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL;

(III) PROPOSED RIGHTS ISSUE ON THE BASIS OF FIVE (5) RIGHTS

SHARES OF EVERY ONE (1) CONSOLIDATED SHARE HELD ON

THE RECORD DATE ON A NON-UNDERWRITTEN BASIS; AND

(IV) NOTICE OF EXTRAORDINARY GENERAL MEETING

Financial Adviser to the Company

瑞斯康集團

DILIGENT

CAPITAL

Diligent Capital Limited

Placing Agent to the Company

ORG

東方源財證券有限公司

ORIENT SECURITIES LIMITED

Independent Financial Adviser

to the Independent Board Committee and

the Independent Shareholders

元庫證券有限公司

SILVERBRICKS SECURITIES CO., LTD.

Capitalised terms used in this cover page shall have the same meanings as those defined in this circular.

A letter from the Board is set out on pages 12 to 40 of this circular and a letter from the Independent Board Committee containing its recommendation to the Independent Shareholders is set out on page 41 of this circular. A letter from the Independent Financial Adviser containing its recommendation to the Independent Board Committee and the Independent Shareholders is set out on pages 42 to 63 of this circular.

Dealings in the Rights Shares in nil-paid form are expected to take place from Monday, 1 September 2025 to Monday, 8 September 2025 (both days inclusive). If the conditions of the Rights Issue are not fulfilled, the Rights Issue will not proceed. Any person contemplating dealing in the nil-paid Rights Shares during the period from Monday, 1 September 2025 to Monday, 8 September 2025 (both days inclusive) will accordingly bear the risk that the Rights Issue may not become unconditional and/or may not proceed. Any person contemplating dealing in the Shares and/or the Rights Shares in their nil-paid form are recommended to consult his/her/its/their own professional advisers.

A notice convening the EGM to be held at Units 5906-12, 59/F, The Center, 99 Queen's Road Central, Hong Kong on Thursday, 14 August 2025 at 10:00 a.m. is set out on pages EGM-1 to EGM-4 of this circular. Whether you are able to attend the EGM or not, you are requested to complete the enclosed proxy form in accordance with the instructions printed on it and return the completed proxy form to the Registrar, Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong as soon as possible and in any event so that it is received at least 48 hours before the time appointed (i.e. Tuesday, 12 August 2025 at 10:00 a.m.) for the EGM or adjourned meeting (as the case may be). Submission of a proxy form shall not preclude you from attending the EGM (or any adjournment of such meeting) and voting in person should you so wish.

The Rights Issue will proceed on a non-underwritten basis irrespective of the acceptance of the provisionally allotted Rights Shares and is subject to fulfillment of conditions. Please refer to the section headed "Conditions of the Rights Issue" in this circular. In the event that the Rights Issue is not fully subscribed, any Rights Shares not taken up by the Qualifying Shareholders or holders of nil-paid rights will be placed to independent places on a best effort basis under the Unsubscribed Arrangements. Any Unsubscribed Rights Shares or NQS Unsold Rights Shares which are not placed under the Unsubscribed Arrangements will not be issued by the Company and the size of the Rights Issue will be reduced accordingly. There is no minimum amount to be raised under the Rights Issue. Shareholders and potential investors are advised to exercise caution when dealing in the Shares and/or nil-paid Rights Shares up to the date when the conditions of the Rights Issue are fulfilled.

23 July 2025

CONTENTS

Page

Expected Timetable ... 1
Definitions ... 6
Letter from the Board ... 12
Letter from the Independent Board Committee ... 41
Letter from the Independent Financial Adviser ... 42
Appendix I — Financial Information of the Group ... I-1
Appendix II — Unaudited Pro Forma Financial Information of the Group ... II-1
Appendix III — General Information ... III-1
Notice of EGM ... EGM-1

EXPECTED TIMETABLE

Set out below is the expected timetable for the proposed Share Consolidation, the Rights Issue and the Placing which is indicative only and has been prepared on the assumption that all the conditions of the Rights Issue will be fulfilled:

Event(s) Date and Time

Expected despatch date of circular together with notice and proxy forms in relation to the EGM. Wednesday, 23 July 2025

Latest time for lodging transfers of the Shares to qualify for attendance and voting at the EGM 4:30 p.m. on Thursday, 7 August 2025

Closure of the register of members of the Company for determining the identity of the Shareholders entitled to attend and vote at the EGM. Friday, 8 August 2025 to Thursday, 14 August 2025 (both days inclusive)

Latest time for lodging proxy forms for the EGM 10:00 a.m. on Tuesday, 12 August 2025

Record date for attendance and voting at the EGM. Thursday, 14 August 2025

Expected date and time of the EGM. 10:00 a.m. on Thursday, 14 August 2025

Announcement of poll results of the EGM. Thursday, 14 August 2025

The following events are conditional on the fulfilment of the conditions relating to the implementation of the Share Consolidation and the Rights Issue:

Event(s) Date and Time

Effective date of the Share Consolidation. Monday, 18 August 2025

First day for free exchange of existing share certificates for new share certificates of the Consolidated Shares. Monday, 18 August 2025

Dealings in the Consolidated Shares commence. 9:00 a.m. on Monday, 18 August 2025

Original counter for trading in Shares in board lots of 5,000 Shares (in the form of existing share certificates) temporarily closes. 9:00 a.m. on Monday, 18 August 2025

EXPECTED TIMETABLE

Event(s)	Date and Time
Temporary counter for trading in Consolidated Shares
in board lots of 1,000 Consolidated Shares (in
the form of existing share certificates) opens.	9:00 a.m. on
Monday, 18 August 2025
Last day of dealings in the Consolidated Shares on
a cum-rights basis	Monday, 18 August 2025
First day of dealings in the Consolidated Shares on
an ex-rights basis relating to the Rights Issue	Tuesday, 19 August 2025
Latest time for lodging transfers of Consolidated Shares
in order to qualify for the Rights Issue	4:30 p.m. on
Wednesday, 20 August 2025
Closure of register of members of the Company
for determination of entitlements to the Rights Issue	Thursday, 21 August 2025 to
Wednesday, 27 August 2025
(both days inclusive)
Record Date for the Rights Issue	Wednesday, 27 August 2025
Register of members of the Company re-opens	Thursday, 28 August 2025
Expected despatch date of the Prospectus
Documents (including the PAL and the Prospectus),
and in case of the Non-Qualifying Shareholders,
the Prospectus only	Thursday, 28 August 2025
First day of dealings in nil-paid Rights Shares	Monday, 1 September 2025
Original counter for trading in Consolidated Shares
in board lots of 5,000 Consolidated Shares (in
the form of new share certificates for Consolidated
Shares) re-opens	9:00 a.m. on
Monday, 1 September 2025
Parallel trading in the Consolidated Shares (in
the form of new share certificates for the
Consolidated Shares and existing share certificates)
commences	9:00 a.m. on
Monday, 1 September 2025

EXPECTED TIMETABLE

Event(s)	Date and Time
Designated broker starts to stand in the market
to provide matching services for the sale and
purchase of odd lots of the Consolidated Shares.	9:00 a.m. on
Monday, 1 September 2025
Latest time for splitting of PAL	4:30 p.m. on
Wednesday, 3 September 2025
Last day of dealings in nil-paid Rights Shares	Monday, 8 September 2025
Latest time for acceptance and payment for
the Rights Shares	4:00 p.m. on
Thursday, 11 September 2025
Latest time for lodging transfer documents of
nil-paid Rights Shares in order to qualify for
the payment of Net Gain	4:00 p.m. on
Thursday, 11 September 2025
Announcement of the number of Unsubscribed Rights
Shares subject to the Unsubscribed Arrangements	Thursday, 18 September 2025
Designated broker ceases to stand in the market
to provide matching services for the sale and
purchase of odd lots of the Consolidated Shares	4:00 p.m. on
Friday, 19 September 2025
Temporary counter for trading in Consolidated Shares
in board lots of 1,000 Consolidated Shares (in
the form of existing share certificates) closes	4:10 p.m. on
Friday, 19 September 2025
Parallel trading in the Consolidated Shares (in
form of new share certificate(s) and existing
share certificate(s)) ends	4:10 p.m. on
Friday, 19 September 2025
Commencement of the placing of Unsubscribed
Rights Shares by the Placing Agent	Friday, 19 September 2025
Last date and time for free exchange of
share Certificates for the new share certificates of
the Consolidated Shares	4:30 p.m. on
Tuesday, 23 September 2025

EXPECTED TIMETABLE

Event(s)	Date and Time
Latest time for Placing of Unsubscribed Rights Shares
by the Placing Agent	Thursday, 9 October 2025
Placing of the Placing Shares to become unconditional	Monday, 13 October 2025
Announcement of the allotment results of the Rights Issue
to be published on the websites of the Stock Exchange
and the Company	Monday, 20 October 2025
Despatch of share certificates for fully-paid Rights Shares
and completion of Placing to take place	Tuesday, 21 October 2025
Despatch of refund cheques, if any, if the Rights Issue
is terminated	Tuesday, 21 October 2025
Commencement of dealings in fully-paid Rights Shares	9:00 a.m. on
Wednesday, 22 October 2025
Payment of Net Gain to relevant No Action
Shareholders (if any) or Non-Qualifying
Shareholders (if any)	Friday, 31 October 2025

All times and dates in this circular refer to local times and dates in Hong Kong. Dates or deadlines specified in the expected timetable above or other parts of this circular are indicative only and may be extended or varied. Any changes to the expected timetable will be published or notified to the Shareholders and the Stock Exchange as and when appropriate in accordance with the Listing Rules.

EFFECT OF BAD WEATHER AND/OR EXTREME CONDITIONS ON THE LATEST TIME FOR ACCEPTANCE

The Latest Time for Acceptance will not take place if a tropical cyclone warning signal no. 8 or above, or "extreme conditions" caused by super typhoons as announced by the Government of the Hong Kong Special Administrative Region or a "black" rainstorm warning:

(i) is/are in force in Hong Kong at any local time before 12:00 noon but no longer in force after 12:00 noon on the day on which the Latest Time for Acceptance is initially scheduled to fall. Instead, the latest time for acceptance of and payment for the Rights Shares will be extended to 5:00 p.m. on the same Business Day; or
(ii) is/are in force in Hong Kong at any local time between 12:00 noon and 4:00 p.m. on the day on which the Latest Time for Acceptance is initially scheduled to fall. Instead, the latest time for acceptance of and payment for the Rights Shares will be rescheduled to 4:00 p.m. on the following Business Day which does not have either of those warnings in force in Hong Kong at any time between 9:00 a.m. and 4:00 p.m..

EXPECTED TIMETABLE

If the Latest Time for Acceptance does not take place on the currently scheduled date, the dates mentioned herein may be affected. The Company will notify the Shareholders by way of announcement(s) on any change to the expected timetable of the Rights Issue as soon as practicable.

DEFINITIONS

In this circular, the following expressions shall have the following meanings unless the context otherwise requires:

"acting in concert" has the same meaning ascribed thereto under the Takeovers Code

"Announcement" the announcement of the Company dated 17 June 2025 in relation to, among other things, the Share Consolidation, Increase in Authorised Share Capital and the Rights Issue

"associate(s)" has the meaning ascribed thereto under to the Listing Rules

"Board" the board of Directors

"Business Day(s)" a day on which licensed banks in Hong Kong are generally open for business, other than a Saturday or a Sunday or a day on which a black rainstorm warning or tropical cyclone warning signal number 8 or above is issued in Hong Kong at any time between 9:00 a.m. and 12:00 noon and is not cancelled at or before 12:00 noon

"CCASS" the Central Clearing and Settlement System established and operated by HKSCC

"CCASS Operational Procedures" the Operational Procedures of HKSCC in relation to CCASS, containing the practices, procedures and administrative requirements relating to operations and functions of CCASS, as from time to time

"Company" Risecomm Group Holdings Limited, a company incorporated in the Cayman Islands with limited liability and the issued Shares of which are listed on the main board of the Stock Exchange (stock code: 1679)

"Completion" completion of the Share Consolidation, the Increase in Authorised Share Capital, the Rights Issue, and the Placing

"connected person(s)" has the meaning ascribed to it under the Listing Rules

"Consolidated Share(s)" ordinary share(s) of HK$0.005 each in the share capital of the Company upon the Share Consolidation becoming effective

"Director(s)" the director(s) of the Company

DEFINITIONS

"EGM"
the extraordinary general meeting of the Company to be convened to consider and, if thought fit, approve the Share Consolidation, the Increase in Authorised Share Capital, the Rights Issue and the transactions contemplated thereunder

"General Rules of CCASS"
the terms and conditions regulating the use of CCASS, as may be amended or modified from time to time and where the context so permits, shall include the CCASS Operational Procedures

"Group"
the Company and its subsidiaries

"HK$"
Hong Kong dollar(s), the lawful currency of Hong Kong

"HKSCC"
Hong Kong Securities Clearing Company Limited

"Hong Kong"
Hong Kong Special Administrative Region of the People's Republic of China

"Increase in Authorised Share Capital"
the increase in the authorised share capital of the Company from HK$1,000,000 divided into 200,000,000 Consolidated Shares to HK$5,000,000 divided into 1,000,000,000 Consolidated Shares by the creation of an additional 800,000,000 new Consolidated Shares

"Independent Board Committee"
the independent committee of the Board, comprising all the independent non-executive Directors, to advise the Independent Shareholders in respect of the terms of the Rights Issue and the transactions contemplated thereunder

"Independent Financial Adviser"
Silverbricks Securities Co. Limited, a licensed corporation to carry out type 1 (dealing in securities), type 2 (dealing in futures contracts) and type 6 (advising on corporate finance) regulated activities under the SFO, which has been appointed as the independent financial adviser to the Independent Board Committee and the independent Shareholders in respect of the terms of the Rights Issue and the transactions contemplated thereunder

"Independent Shareholder(s)"
any Shareholder(s) who are not required to abstain from voting at the EGM under the Listing Rules

"Independent Third Party(ies)"
third party(ies) who, to the best of the Directors' knowledge, information and belief having made all reasonable enquiry, are independent of and not acting in concert or connected with the Company and any of its connected persons or any of their respective associates

– 7 –

DEFINITIONS

"Last Trading Day"
Tuesday, 17 June 2025, being the last trading day for the Shares on the Stock Exchange immediately prior to the date of the Announcement

"Latest Practicable Date"
18 July 2025, being the latest practicable date prior to the printing of this circular for ascertaining certain information contained herein

"Latest Time for Acceptance"
4:00 p.m. on Thursday, 11 September 2025 (or such other time or date as may be determined by the Company), being the latest time for acceptance of the offer of and payment for, the Rights Shares, as described in the Prospectus Documents

"Listing Committee"
has the meaning as defined in the Listing Rules

"Listing Rules"
the Rules Governing the Listing of Securities on the Stock Exchange

"Net Gain"
the aggregate of any premiums (being the aggregate amount paid by the places after deducting the aggregate amount of the Subscription Price for the Unsubscribed Rights Shares placed by the Placing Agent under the Placing Agreement) pursuant to the Unsubscribed Arrangements

"No Action Shareholders"
those Qualifying Shareholders who do not subscribe for the Right Shares (whether partially or fully) in their assured entitlements, or Non-Qualifying Shareholders (as the case may be)

"Non-Qualifying Shareholder(s)"
the Overseas Shareholder(s) whom the Directors, based on legal opinions provided by the Company's legal advisers, consider it necessary or expedient not to offer the Rights Shares to such Shareholders on account either restrictions under the laws of the relevant place or the requirements of a relevant regulatory body or stock exchange in that place

"Overseas Letter"
a letter from the Company to the Non-Qualifying Shareholders explaining the circumstances in which the Non-Qualifying Shareholders are not permitted to participate in the Rights Issue

"Overseas Shareholders"
the Shareholder(s) whose name(s) appear on the register of members of the Company on the Record Date and whose address(es) as shown on such register is/are in a place(s) outside Hong Kong

DEFINITIONS

"PAL(s)"
the renounceable provisional allotment letter(s) to be issued to the Qualifying Shareholders in connection with the Rights Issue

"Placing"
the offer by way of private placing of the Unsubscribed Rights Shares on a best effort basis by the Placing Agent to the independent placee(s) during the Placing Period on the terms and conditions set out in the Placing Agreement

"Placing Agent"
Orient Securities Limited, a licensed corporation carrying out type 1 (dealing in securities), type 4 (advising on securities) and type 9 (asset management) regulated activities under the SFO, being the placing agent appointed by the Company pursuant to the Placing Agreement

"Placing Agreement"
the placing agreement dated 17 June 2025 (after trading hours of the Stock Exchange) entered into between the Company and the Placing Agent in respect of the Unsubscribed Arrangements, pursuant to which the Placing Agent has agreed to procure placees on a best effort basis to subscribe for the Unsubscribed Rights Shares

"Placing Long Stop Date"
13 October 2025, or such other date as may be agreed between the Company and the Placing Agent in writing as the latest date for the satisfaction of the conditions precedent under the Placing Agreement

"Placing Period"
the period from 19 September 2025 up to 9 October 2025, or such other dates as the Company may announce, being the period during which the Placing Agent will seek to effect the Unsubscribed Arrangements

"Placing Price"
the placing price of the unsubscribed Rights Shares shall be at least equal to the Subscription Price and the final price determination will depend on the demand for and the market conditions of the Unsubscribed Rights Shares during the placement process

"Posting Date"
28 August 2025 or such other date as the Company may announce, being the date of despatch of the Prospectus Documents

"PRC"
the People's Republic of China, which for the purpose of this circular, excludes Hong Kong, the Macau Special Administrative Region of the PRC and Taiwan

"Prospectus"
the prospectus to be despatched to the Shareholders by the Company containing details of the Rights Issue

DEFINITIONS

"Prospectus Documents" collectively, the Prospectus and the PAL

"Public Float Requirement(s)" the public float requirement under Rules 8.08(1)(a) and 13.32(1) of the Listing Rules

"Qualifying Shareholders" Shareholder(s), whose name(s) appear(s) on the register of members of the Company as at the close of business on the Record Date, other than the Non-Qualifying Shareholder(s)

"Record Date" 27 August 2025, or such other date as the Company may announce, being the date by reference to which entitlements of the Shareholders to participate in the Rights Issue will be determined

"Registrar" the Company's branch share registrar and transfer office in Hong Kong, Tricor Investor Services Limited at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong

"Rights Issue" the proposed issue of the Rights Shares on the basis of five (5) Rights Shares for every one (1) Consolidated Share held by the Qualifying Shareholders on the Record Date at the Subscription Price on the terms and subject to the conditions set out in the Prospectus Documents

"Rights Share(s)" Shares to be issued and allotted under the proposed Rights Issue based on five (5) Rights Shares for every one (1) Consolidated Share in issue on the Record Date, being 255,728,860 Consolidated Shares based on the Company's issued share capital as at the Latest Practicable Date

"RMB" Renminbi, the lawful currency of the PRC

"SFC" the Securities and Futures Commission of Hong Kong

"SFO" the Securities and Futures Ordinance (Cap 571 of the laws of Hong Kong)

"Share(s)" ordinary share(s) of HK$0.001 each in the share capital of the Company

"Share Consolidation" the proposed consolidation of every five (5) issued and unissued Shares be consolidated into one (1) Consolidated Share

"Shareholder(s)" holder(s) of the issued Share(s)

"Share Option(s)" the share option(s) granted by the Company pursuant to the Share Option Scheme

– 10 –

DEFINITIONS

"Share Option Scheme"
the share option scheme adopted by the Company on 16 May 2017

"Stock Exchange"
The Stock Exchange of Hong Kong Limited

"Subscription Price"
HK$0.5 per Rights Share

"substantial shareholder(s)"
has the meaning as ascribed to it under the Listing Rules

"Takeovers Code"
the Hong Kong Code on Takeovers and Mergers

"Unsubscribed Arrangements"
arrangements to place the Unsubscribed Rights Shares by the Placing Agent on a best effort basis to investors who (or as the case may be, their ultimate beneficial owner(s)) are not Shareholders and are otherwise Independent Third Parties pursuant to Rule 7.21(1)(b) of the Listing Rules

"Unsubscribed Rights Shares"
those Rights Shares that are not subscribed by the Qualifying Shareholders and Rights Shares which would otherwise have been allotted to the Non-Qualifying Shareholders (as the case may be)

"%
per cent.

11 -

LETTER FROM THE BOARD

RISECOMM

瑞斯康

RISECOMM GROUP HOLDINGS LIMITED

瑞斯康集團控股有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 1679)

Executive Directors:
Ms. Zhao Luyi
Mr. Tsang Wah Tak, Brian
Mr. Jiang Feng

Non-executive Directors:
Mr. Yu Lu
Mr. Ding Zhigang
Ms. Guo Lei

Independent Non-executive Directors:
Mr. Victor Yang
Ms. Lo Wan Man
Mr. Zou Heqiang

Registered office:
Cricket Square
Hutchins Drive
P.O. Box 2681
Grand Cayman KY1-1111
Cayman Islands

Headquarters, head office and principal place of business in Hong Kong:
Units 4004–5, 40th Floor
Cosco Tower
183 Queen’s Road Central
Hong Kong

23 July 2025

To the Qualifying Shareholders and, for information only, the Non-Qualifying Shareholders (if any)

Dear Sir or Madam,

(I) PROPOSED SHARE CONSOLIDATION;
(II) PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL;
(III) PROPOSED RIGHTS ISSUE ON THE BASIS OF FIVE (5) RIGHTS
SHARES OF EVERY ONE (1) CONSOLIDATED SHARE HELD ON
THE RECORD DATE ON A NON-UNDERWRITTEN BASIS; AND
(IV) NOTICE OF EXTRAORDINARY GENERAL MEETING

INTRODUCTION

Reference is made to the Announcement.

The purpose of this circular is to provide you with, among other things, (i) further information on the Rights Issue and the transactions contemplated thereunder; (ii) a letter from the Independent Board Committee to the Independent Shareholders in respect of the Rights

LETTER FROM THE BOARD

Issue; (iii) a letter of advice from the Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders in respect of the Rights Issue; and (iv) a notice convening the EGM.

1. PROPOSED SHARE CONSOLIDATION

The Board proposes to implement the Share Consolidation on the basis that every five (5) issued and unissued Shares of par value of HK$0.001 each be consolidated into one (1) Consolidated Share of HK$0.005 each.

Effects of the Share Consolidation

As of the Latest Practicable Date, the authorised share capital of the Company is HK$1,000,000 divided into 1,000,000,000 Shares with par value of HK$0.001 each, of which 255,728,860 Shares have been issued and are fully paid or credited as fully paid.

Assuming that no further Shares will be issued or repurchased from the date hereof until the date of the EGM, immediately upon the Share Consolidation becoming effective, the authorised share capital of the Company will become HK$1,000,000 divided into 200,000,000 Consolidated Shares with par value of HK$0.005 each, of which 51,145,772 Consolidated Shares will be in issue and fully paid or credited as fully paid.

Upon the Share Consolidation becoming effective, the Consolidated Shares shall rank pari passu in all respects with each other, and the Share Consolidation will not result in any change in the relative rights of the Shareholders.

As of the Latest Practicable Date, the Company has outstanding Share Options entitling the holders thereof to subscribe for a total of 170,496 Shares under the Share Option Scheme. Save for the Share Options, the Company does not have any other derivatives, options, warrants, other securities, conversion rights, or similar rights that are convertible or exchangeable into Shares or Consolidated Shares.

Other than the expenses to be incurred in relation to the Share Consolidation, the implementation thereof will not alter the underlying assets, business operations, management or financial position of the Company or the proportionate interests or rights of the Shareholders, save for any fractional Consolidated Shares will not be allocated to the Shareholders who may otherwise be entitled.

Conditions of the Share Consolidation

The Share Consolidation is conditional upon the following conditions:

(i) the passing of an ordinary resolution by the Shareholders at the EGM to approve the Share Consolidation;

(ii) the Listing Committee of the Stock Exchange granting the listing of, and permission to deal in, the Consolidated Shares upon the Share Consolidation becoming effective; and

13 -

LETTER FROM THE BOARD

(iii) the compliance with all relevant procedures and requirements under the applicable laws of the Cayman Islands and the Listing Rules to effect the Share Consolidation.

Subject to the fulfilment of the conditions of the Share Consolidation, the effective date of the Share Consolidation is expected to be on 18 August 2025.

As of the Latest Practicable Date, none of the conditions above have been fulfilled.

Application for listing of the Consolidated Shares

The Company will make an application to the Listing Committee of the Stock Exchange for the listing of, and the permission to deal in, the Consolidated Shares upon the Share Consolidation becoming effective.

Subject to the granting of listing of, and permission to deal in, the Consolidated Shares on the Stock Exchange upon the Share Consolidation becoming effective, as well as compliance with the stock admission requirements of the HKSCC, the Consolidated Shares will be accepted as eligible securities by HKSCC for deposit, clearance and settlement in CCASS with effect from the commencement date of dealings in the Consolidated Shares on the Stock Exchange or such other date as determined by HKSCC. Settlement of transactions between participants of the Stock Exchange on any trading day is required to take place in CCASS on the second settlement day thereafter. All activities under CCASS are subject to the General Rules of CCASS and CCASS Operational Procedures, which are in effect from time to time. All necessary arrangements will be made for the Consolidated Shares to be admitted into CCASS, which was established and operated by HKSCC.

None of the Shares are listed or dealt in any other stock exchange other than the Stock Exchange, and at the time the Share Consolidation becoming effective, the Consolidated Shares in issue will not be listed or dealt in on any stock exchange other than the Stock Exchange, and no such listing or permission to deal is being or is proposed to be sought.

Fractional entitlement to the Consolidated Shares

Fractional Consolidated Shares arising from the Share Consolidation, if any, will be disregarded and will not be allocated to the Shareholders but will be aggregated and, if possible, sold for the benefit of the Company. Fractional Consolidated Shares will only arise in respect of the entire shareholding of a holder of the Shares regardless of the number of share certificates held by such holder.

Odd lots arrangement and matching services

In order to facilitate the trading of odd lots (if any) of the Consolidated Shares arising from the Share Consolidation, the Company has appointed Orient Securities Limited as an agent to provide matching services, on a best effort basis, to those Shareholders who wish to acquire odd lots of the Consolidated Shares to make up a full

LETTER FROM THE BOARD

board lot, or to dispose of their holding of odd lots of the Consolidated Shares, during the period from 9:00 a.m. on Monday, 1 September 2025 to 4:00 p.m. on Friday, 19 September 2025 (both dates inclusive). Shareholders who wish to take advantage of this facility should contact Dealing Department of Orient Securities Limited at Room 2203-04, 22/F, New World Tower 1, 16-18 Queen's Road Central, Hong Kong or at telephone number: (852) 2180 9292 during office hours (i.e. 9:00 a.m. to 4:30 p.m.) of such period.

Holders of odd lots of the Consolidated Shares should note that the matching of the sale and purchase of odd lots of the Consolidated Shares is not guaranteed. Shareholders who have any doubt about the odd lots matching arrangement are advised to consult their own professional advisers.

Shareholders or potential investors should note that (i) odd lots will be created after the Share Consolidation; (ii) odd lots arrangements do not guarantee successful matching of all odd lots at the relevant market price; and (iii) odd lots might be sold below the market price in the market.

Exchange of share certificates

Subject to the Share Consolidation becoming effective, Shareholders may during the period from Monday, 18 August 2025 to Tuesday, 23 September 2025 (both days inclusive), submit share certificates for the Shares (in beige colour) to the Registrar at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong, in exchange, at the expense of the Company for new share certificates for the Consolidated Shares (in purple colour). Thereafter, share certificates for the Shares will be accepted for exchange only on payment of a fee of HK$2.50 (or such other amount as may be allowed by the Stock Exchange from time to time) for each share certificate for the Shares cancelled or each new share certificate issued for the Consolidated Shares, whichever the number of certificates cancelled/issued is higher.

The existing share certificates will only be valid for delivery, trading, and settlement purposes for the period up to 4:10 p.m. on Friday, 19 September 2025, and thereafter will not be accepted for delivery, trading, and settlement purposes. However, the existing share certificates will continue to be good evidence of title to the Consolidated Shares on the basis of five (5) Shares for one (1) Consolidated Share. The new share certificates for the Consolidated Shares will be issued in purple colour to distinguish them from the share certificates for the Shares, which are in beige colour.

Reasons for the Share Consolidation

Pursuant to Rule 13.64 of the Listing Rules, where the market price of the securities of an issuer approaches the extremities of HK$0.01 or HK$9,995.00, the Stock Exchange reserves the right to require the issuer either to change the trading method or proceed with a consolidation or splitting of securities. Further, the "Guide on Trading Arrangements for Selected Types of Corporate Actions" issued by the Hong Kong Exchanges and Clearing Limited on 28 November 2008 and updated in September 2024 has further stated that (i) market price of the Shares at a level less than HK$0.10 each will be considered as

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LETTER FROM THE BOARD

trading at extremity as referred to under Rule 13.64 of the Listing Rules; and (ii) taking into account the minimum transaction costs for a securities trade, the expected value per board lot should be greater than HK$2,000.

Since 17 February 2025, the share price of the Company has been trading below HK$0.15, and the closing price of the Shares as at the Latest Practicable Date was HK$0.159 per Share. The value of each existing board lot has been less than HK$2,000. Based on the closing price of HK$0.159 per Share as at the Latest Practicable Date and the existing board lot size of 5,000 Shares, the Board resolved to propose the Share Consolidation, resulting in HK$0.795 per Consolidated Share and HK$3,975 per board lot of 5,000 Consolidated Shares with the view to complying with the trading requirements under the Listing Rules.

The Board considers that the proposed Share Consolidation would bring about a corresponding upward adjustment in the trading price per Consolidated Share on the Stock Exchange. Further, the Share Consolidation would reduce the overall transaction and handling costs of dealings in the Shares as a proportion of the market value of each board lot, since most of the banks/securities houses will charge a minimum transaction cost for each securities trade.

As of the Latest Practicable Date, save as disclosed in this circular, the Company currently (i) does not have any agreement, arrangement, understanding, intention, or negotiation (either concluded or in process) on any potential fundraising activities which will involve issue of equity securities of the Company; and (ii) has no other plan or intention to carry out any future corporate actions in the next twelve months which may have an effect of undermining or negating the intended purpose of the Share Consolidation. However, in the event there is any change to the business environment and/or financial position of the Company due to unforeseeable circumstances, and the Company is required to conduct further fund raising exercises when suitable opportunities arise to support future development of the Group, the Company will publish further announcement(s) in compliance with the Listing Rules, as and when appropriate.

Given the above reasons, the Board considers that the Share Consolidation is justifiable, notwithstanding the potential costs and impact arising from creating odd lots to Shareholders. Accordingly, the Board believes that the Share Consolidation is beneficial to and in the interests of the Company and the Shareholders as a whole.

The Board believes that the Share Consolidation will not have any material adverse effect on the Group's financial position or result in a change in the relative rights of the Shareholders.

Shareholders and potential investors should be aware of and take note that the Share Consolidation is conditional upon satisfaction of the conditions set out in the paragraph headed "Conditions of the Share Consolidation". Accordingly, the Share Consolidation may or may not proceed. Shareholders and potential investors are advised to exercise caution when dealing in the Shares, and if they are in any doubt about their position, they should consult their professional advisers.

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LETTER FROM THE BOARD

2. PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL

Immediately upon the Share Consolidation becoming effective and assuming there will be no change to the total issued share capital of the Company between the Latest Practicable Date and the effective date of the Share Consolidation, the authorised share capital of the Company will become HK$1,000,000 divided into 200,000,000 Consolidated Shares with par value of HK$0.005 each, of which 51,145,772 Consolidated Shares have been issued and are fully paid or credited as fully paid.

To facilitate the Rights Issue and enable the future expansion and growth of the Group while also providing the Company with increased flexibility to raise funds, the Board proposes to increase the authorised share capital of the Company from HK$1,000,000 divided into 200,000,000 Consolidated Shares to HK$5,000,000 divided into 1,000,000,000 Consolidated Shares by the creation of an additional 800,000,000 new Consolidated Shares.

The Board believes the Increase in Authorised Share Capital will give the Company more flexibility for future fundraising. Therefore, the Board considers this decision to be in the interests of the Company and the Shareholders.

The Increase in Authorised Share Capital is conditional upon, among other things, (i) the passing of an ordinary resolution by the Shareholders at the EGM to approve the Increase in Authorised Share Capital; and (ii) the Share Consolidation has become effective.

3. PROPOSED RIGHTS ISSUE

Subject to the Share Consolidation and the Increase in Authorised Share Capital becoming effective, the Board proposes to raise gross proceeds of up to approximately HK$127.86 million, net of expenses, through a Rights Issue of 255,728,860 Rights Shares at the Subscription Price of HK$0.5 per Rights Share based on five (5) Rights Shares for every one (1) Consolidated Share held by the Qualifying Shareholders on the Record Date. The Rights Issue is only available to the Qualifying Shareholders and will not be available to Non-Qualifying Shareholders.

Subject to the fulfilment of the conditions of the Rights Issue, the Rights Issue will proceed on a non-underwritten basis irrespective of the level of acceptance of the provisionally allotted Rights Shares.

Further details of the Rights Issue are set out below:

Issue statistics

Basis of the Rights Issue: five (5) Rights Shares for every one (1) Consolidated Share held by the Qualifying Shareholders at the close of business on the Record Date

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Subscription Price: HK$0.5 per Rights Share
Net Subscription Price (after expenses): HK$0.49 per Rights Share
Number of Shares in issue as of the Latest Practicable Date: 255,728,860 Shares
Number of Consolidated Shares upon the Share Consolidation becoming effective: 51,145,772 Consolidated Shares (assuming that there is no further issue or repurchase of new Shares between the Latest Practicable Date and the effective date of the Share Consolidation)
Number of Rights Shares: Up to 255,728,860 Rights Shares (assuming there is no further issue or repurchase of new Shares between the Latest Practicable Date and the Record Date)
Gross proceeds from the Rights Issue: Up to approximately HK$127.86 million before expenses (assuming there is no further issue or repurchase of new Shares between the Latest Practicable Date and the Record Date and all Rights Shares are taken up by the Qualifying Shareholders or the Unsubscribed Rights Shares are successfully placed by the Placing Agent under the Placing)

Assuming there is no change to the total issued capital of the Company on or before the Record Date, 255,728,860 Rights Shares to be issued pursuant to the terms of the Rights Issue represents (i) 500% of the theoretical total issued share capital of the Company (after taking into account the effect of the Share Consolidation) as at the Latest Practicable Date; and (ii) 83.33% of the theoretical total issued share capital of the Company (after taking into account the effect of the Share Consolidation) as enlarged by the allotment and issuance of the Rights Shares immediately upon Completion.

Undertakings

The Company has not received any information or irrevocable undertaking from any Substantial Shareholder of the Company of any intention in relation to the Rights Shares to be provisionally allotted to that Shareholder under the Rights Issue as at the Latest Practicable Date.

Qualifying Shareholders

The Rights Issue is only available to the Qualifying Shareholders. The Company will send (i) the Prospectus Documents to the Qualifying Shareholders; and (ii) the Overseas Letter together with the Prospectus, for information only, to the Non-Qualifying Shareholders.

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LETTER FROM THE BOARD

To qualify for the Rights Issue, the Shareholders must at the close of business on the Record Date: (i) be registered on the registers of members of the Company; and (ii) not be the Non-Qualifying Shareholders.

In order to be registered as members of the Company on the Record Date, the Shareholders must lodge any transfer of the Shares (with the relevant share certificates) for registration with the Registrar by 4:30 p.m. on Wednesday, 20 August 2025.

Closure of register of members

The register of members of the Company will be closed from Friday, 8 August 2025 to Thursday, 14 August 2025 (both days inclusive) to determine whether the Shareholders are eligible to attend and vote at the EGM, the period during which no transfer of shares will be registered.

The register of members will be closed from Thursday, 21 August 2025 to Wednesday, 27 August 2025 (both days inclusive) to determine the entitlements to the Rights Issue, the period during which no transfer of Shares will be registered.

Subscription Price

The Subscription Price of HK$0.5 per Rights Share is payable in full by a Qualifying Shareholder upon acceptance of the relevant provisional allotment of the Rights Shares and, where applicable, when a transferee of the nil-paid Rights Shares subscribes for the Rights Shares.

The Subscription Price represents:

(i) a discount of approximately 22.48% to the theoretical closing price of HK$0.645 per Consolidated Share (after taking into account the effect of the Share Consolidation) as quoted on the Stock Exchange on the Last Trading Day;

(ii) a discount of approximately 20.63% to the average theoretical closing price of approximately HK$0.63 per Consolidated Share (after taking into account the effect of the Share Consolidation) as quoted on the Stock Exchange for the last five (5) consecutive trading days prior to the Last Trading Day;

(iii) a discount of approximately 22.12% to the average theoretical closing price of approximately HK$0.642 per Consolidated Share (after taking into account the effect of the Share Consolidation) as quoted on the Stock Exchange for the late ten (10) consecutive trading days up to and including the Last Trading Day;

(iv) a discount of approximately 4.62% to the theoretical ex-rights price of approximately HK$0.5242 per Consolidated Share as adjusted for the effect of the Rights Issue, based on the theoretical closing price of HK$0.645 per Consolidated Share (after taking into account the effect of the Share Consolidation) as quoted on the Stock Exchange on the Last Trading Day;

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(v) a theoretical dilution effect (as defined under Rule 7.27B of the Listing Rules) represented by a discount of approximately 18.73%, which is calculated based on the theoretical diluted price of approximately HK$0.5242 per Consolidated Share to the benchmarked price of approximately HK$0.645 per Consolidated Share (as defined under Rule 7.27B of the Listing Rules, taking account the higher of (i) the closing price of the Shares as quoted on the Stock Exchange on the Last Trading Day and (ii) the average of the theoretical closing prices of the Consolidated Shares as quoted on the Stock Exchange for the five (5) previous consecutive trading days prior to the Last Trading Day);

(vi) a premium of approximately HK$2.82 over the audited net liability value per Consolidated Share of approximately HK$2.32 based on the latest audited consolidated net liabilities of the Group of approximately RMB111.35 million (equivalent to approximately HK$118.51 million) as at 31 December 2024 and the theoretical number of Consolidated Shares (after taking into account the effect of the Share Consolidation) in issue as at the Last Trading Day (i.e. 255,728,860 Shares/5 = 51,145,772 Consolidated Shares); and

(vii) a discount of approximately 37.11% to the theoretical closing price of HK$0.795 per Consolidated Share (after taking into account the effect of the Share Consolidation) as quoted on the Stock Exchange on the Latest Practicable Date.

The theoretical diluted price, the benchmarked price, and theoretical dilution effect for the Rights Issue are approximately HK$0.5242 per Consolidated Share, HK$0.645 per Consolidated Share, and 18.73%, respectively. Despite the theoretical dilution effect of 18.73%, it is the combined effect of achieving the fund raising requirement and the determination of the Subscription Price to attract Shareholders in participating in the Rights Issue (as detailed below), the Rights Issue represents the Group's ability to raise new capital, to improve its gearing and financial performance by lowering the level of debt and financing costs of the Group. The Rights Issue will not result in a theoretical dilution effect of 25% or more on its own. As such, the theoretical dilution impact of the Rights Issue is in compliance with Rule 7.27B of the Listing Rules.

The Subscription Price was arrived at after an arm's length negotiation, based on, among other things, the prevailing market price of the Shares and the Group's financial conditions.

In determining the Subscription Price, the Directors have considered, among other thing as mentioned above, the closing price in the past three months prior to and including the Last Trading Day (the "Relevant Period"), as a benchmark to reflect the prevailing market conditions and recent market sentiment. During the Relevant Period, the Shares were traded on the Stock Exchange with an average closing price of approximately HK$0.64 per Consolidated Share (after taking into account the effect of the Share Consolidation). The Subscription Price represents a discount of approximately 21.88% to the average closing price of the Shares of HK$0.64 per Consolidated Share (after taking into account the effect of the Share Consolidation) under the Relevant Period. In addition,

LETTER FROM THE BOARD

the average daily trading volume was approximately 228,750 Shares, representing approximately 0.09% of the total number of issued Shares as at the Last Trading Day. Such relatively low average daily trading volume indicating a lack of liquidity and demand for the Shares.

In consideration of the above factors, in particular the weak market sentiment in the capital market in Hong Kong as a whole and in the Shares of the Company, and the anticipated market response to the Rights Issue, the Board is of the view that the Subscription Price should act as a market catalyst to attract Shareholders and investors to participate in the Rights Issue.

On the basis of the lack of liquidity and demand for the Shares, and in view of the funding needs of the Company, as discussed in the section headed "Reasons for the Rights Issue and the intended use of proceeds" in this circular, the Subscription Price was set at a discount to the benchmarked price of the Shares as described above to lower the further investment costs of the Shareholders so as to encourage Shareholders in taking up their entitlements to maintain their shareholdings in the Company, thereby minimizing dilution impact.

The Directors (excluding the independent non-executive Directors) consider that the terms of the Rights Issue (including the Subscription Price) are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

Status of the Rights Shares

The Rights Shares (when allotted, issued, and fully paid) will rank pari passu in all respects with the Consolidated Shares in issue on the date of allotment and issue of the Rights Shares. Holders of the Rights Shares will be entitled to receive all future dividends and distributions, which may be declared, made, or paid on or after the date of allotment and issue of the fully paid Rights Shares.

Basis of provisional allotments

The basis of the provisional allotment shall be five (5) Rights Shares (in nil-paid form) for every one (1) Consolidated Share held by the Qualifying Shareholders as at the close of business on the Record Date.

Qualifying Shareholders may apply for all or any part of their respective provisional allotment by lodging a duly completed PAL(s) and a cheque or a banker's cashier order for the sum payable for the Rights Shares being applied for with the Registrar on or before the Latest Time for Acceptance.

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Rights of the Overseas Shareholders

The Prospectus Documents are not intended to be, have not been, and will not be registered or filed under the applicable securities legislation of any jurisdiction other than Hong Kong. Overseas Shareholder(s) may not be eligible to participate in the Rights Issue.

According to the register of members of the Company as of the Latest Practicable Date, the Company had a total of 3 Overseas Shareholders holding an aggregate of 61,004,896 Shares, representing approximately 23.86% of the total number of the issued Shares, all of which have his/her addresses registered in the PRC, Republic of Seychelles, and Canada.

Pursuant to Rule 13.36(2)(a) of the Listing Rules, the Directors have conducted inquiries into the feasibility of extending the Rights Issue to Overseas Shareholders with registered addresses in the listed jurisdictions. Shareholders having an address outside Hong Kong as shown on the register of members of the Company on the Record Date will not qualify for the Rights Issue if the Board, after making relevant enquiries with the legal advisers in the relevant jurisdictions, considers that the exclusion of such Overseas Shareholders from the Rights Issue would be necessary or expedient on account either of legal restrictions under the laws of the relevant place or any requirements of the relevant regulatory body or stock exchange in that place.

It is the responsibility of the Shareholders, including the Overseas Shareholders, wishing to make an application for the Rights Shares, to satisfy himself/herself/itself before taking up his/her/its provisional allotments under the Rights Issue, as to the observance of the laws and regulations of all relevant jurisdictions, including the obtaining of any governmental or other consents and to pay any taxes and duties required to be paid in such jurisdiction in connection with the taking up and onward sale of the Rights Shares.

The Company reserves the right to treat as invalid any acceptance of or application for the Rights Shares where it believes that such acceptance or application would violate the applicable securities or other laws or regulations of any territory or jurisdiction.

The Rights Issue does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to acquire, nil-paid Rights Shares or fully paid Rights Shares or to take up any entitlements to nil-paid Rights Shares or fully-paid Rights Shares in any jurisdiction in which such an offer or solicitation is unlawful.

Arrangements will be made for the Rights Shares, which would otherwise have been provisionally allotted to the Non-Qualifying Shareholders, to be sold in the market in their nil-paid form as soon as practicable after dealings in the nil-paid Rights Shares commence and before dealings in the nil-paid Rights Shares end, if a premium (net of expenses) can be obtained. The proceeds from such sale, less expenses, of more than HK$100 will be paid pro rata to the relevant Non-Qualifying Shareholders. Given administrative costs, the Company will retain individual amounts of HK$100 or less for its benefit.

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Any unsold entitlement of Non-Qualifying Shareholders to the Rights Shares and any Rights Shares provisionally allotted but not accepted by the Qualifying Shareholders will, if possible, be placed by the Placing Agent under the Unsubscribed Arrangements to investors who (or as the case may be, their ultimate beneficial owner(s)) are not Shareholders and are otherwise Independent Third Parties.

Overseas Shareholders should note that they may or may not be entitled to the Rights Issue. Accordingly, Overseas Shareholders should exercise caution when dealing with the Company's securities.

No fractional entitlement

Based on the entitlement to subscribe five (5) Rights Shares for every one (1) Consolidated Share held by the Qualifying Shareholders on the Record Date, no fractional entitlements to the Rights Shares will arise from the Rights Issue.

Application for listing

The Company will apply to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Rights Shares in both their nil-paid and fully paid forms to be issued and allotted pursuant to the Rights Issue. No part of the securities of the Company is listed or dealt in, and no listing of or permission to deal in any such securities is being or is proposed to be sought on any other stock exchanges.

Dealing in the Rights Shares in their nil-paid and fully paid forms will be in the board lots of 5,000 Rights Shares.

Rights Shares will be eligible for admission into CCASS

Subject to the granting of the listing of, and permission to deal in, the Rights Shares in both their nil-paid and fully-paid forms on the Stock Exchange, as well as compliance with the stock admission requirements of HKSCC, the Rights Shares in both their nilpaid and fully-paid forms, will be accepted as eligible securities by HKSCC for deposit, clearance, and settlement in CCASS with effect from the respective commencement dates of dealings in the Rights Shares in both their nil-paid and fully-paid forms on the Stock Exchange or such other dates as determined by HKSCC.

Settlement of transactions between participants of the Stock Exchange on any trading day is required to take place in CCASS on the second trading day thereafter. All activities under CCASS are subject to the General Rules of CCASS and CCASS Operational Procedures in effect from time to time. Shareholders should seek advice from their licensed securities dealer(s) or other professional adviser(s) for details of those settlement arrangements and how such arrangements will affect their rights and interests.

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Stamp duty and other applicable fees

Dealings in the Rights Shares in both their nil-paid and fully paid forms will be subject to the payment of (i) stamp duty, (ii) the Stock Exchange trading fee, (iii) SFC transaction levy, and (iv) any other applicable fees and charges in Hong Kong.

Share certificates and refund cheques for Rights Issue

Subject to the fulfilment of the conditions of the Rights Issue as set out below, share certificates for all fully paid Rights Shares are expected to be posted to those entitled thereto by ordinary post to their registered address, at their own risks, on or before Tuesday, 21 October 2025.

If the Rights Issue does not become unconditional, refund cheques are expected to be despatched by ordinary post on or before Tuesday, 21 October 2025 at the respective Shareholders' own risk.

Non-underwritten basis

Subject to the fulfilment of the conditions of the Rights Issue, the Rights Issue will proceed on a non-underwritten basis irrespective of the level of acceptances of the provisionally allotted Rights Shares.

In the event the Rights Issue is not fully subscribed, any Rights Shares not taken up by the Qualifying Shareholders will be placed to independent places under the Unsubscribed Arrangements. Any Unsubscribed Rights Shares that remain not placed under the Unsubscribed Arrangements will not be issued by the Company and the size of the Rights Issue will be reduced accordingly. There is no minimum amount to be raised under the Rights Issue.

As the Rights Issue will proceed on a non-underwritten basis, Shareholder(s) who applies to take up all or part of his/her/its entitlement under the PAL(s) may unwittingly incur an obligation to make a general offer for the Shares under the Takeovers Code and/or potentially result in the Company's non-compliance of the Public Float Requirement of the Listing Rules. Accordingly, the Rights Issue will be made on terms that the Company will provide for the Shareholders to apply on the basis that if the Rights Shares are not fully taken up, the application of any Shareholder (except for HKSCC Nominees Limited) for his/her/its assured entitlement under the Rights Issue will be scaled down by the Company to a level which (i) does not trigger an obligation on part of the relevant Shareholder to make a general offer under the Takeovers Code in accordance to the note to Rule 7.19(5)(b) of the Listing Rules; and/or (ii) does not result in the non-compliance of the Public Float Requirement. Any subscription monies not utilised due to the scaled-down application of entitled Rights Shares will be refunded to the affected applicants.

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The scaling-down of applications for Rights Shares will be conducted in a fair and equitable manner, guided by the following principles:

(a) if the scale-down is necessary due to an exceeding of shareholding by a group of Qualifying Shareholders acting in concert (referred to as the “Affected Group(s) of Shareholders”) rather than an individual Qualifying Shareholder, the allocations of PAL(s) to members of the Affected Group(s) of Shareholders will be determined based on the number of Shares held by the affected applicants on the Record Date; and

(b) the allocations of PAL(s) to different Affected Group(s) of Shareholders and/or affected individual Qualifying Shareholders will be made on a pro rata basis, based on the number of Shares held by the affected applicant(s) and/or affected group(s) of applicant(s) on the Record Date.

Procedures in respect of the Unsubscribed Rights Shares and the Unsubscribed Arrangements

Pursuant to Rule 7.21(1)(b) of the Listing Rules, the Company must make arrangements to dispose of the Unsubscribed Rights Shares by offering the Unsubscribed Rights Shares to independent places for the benefit of the Shareholders to whom they were offered by way of the rights. There will be no excess application arrangements in relation to the Rights Issue as stipulated under Rule 7.21(1)(a) of the Listing Rules.

On 17 June 2025 (after trading hours), the Company entered into the Placing Agreement with the Placing Agent in relation to the placing of the Unsubscribed Rights Shares to independent places on a best-effort basis. According to the Placing Agreement, the Company has appointed the Placing Agent to place the Unsubscribed Rights Shares during the Placing Period to independent places on a best-effort basis, and any premium over the Subscription Price for those Rights Shares that is realised will be paid to those No Action Shareholders and Non-Qualifying Shareholders on a pro-rata basis. The Placing Agent will, on a best-effort basis, procure, by not later than 4:00 p.m. on Friday, 19 September 2025, acquirers for all (or as many as possible) of those Unsubscribed Rights Shares. Any Unsubscribed Rights Shares that are not placed will not be issued by the Company, and the size of the Rights Issue will be reduced accordingly.

Net Gain (if any) will be paid (without interest) to the No Action Shareholders and Non-Qualifying Shareholders as set out below on a pro-rata basis (but rounded down to the nearest cent):

A. the relevant Qualifying Shareholders (or such persons who hold any nil-paid rights at the time such nil-paid rights are lapsed) whose nil-paid rights are not validly applied for in full, by reference to the extent that Consolidated Shares in his/her/its nil-paid rights are not validly applied for; and

B. the relevant Non-Qualifying Shareholders with reference to their shareholdings in the Company on the Record Date.

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The Placing Agreement

The principal terms of the Placing Agreement are summarised below.

Date : 17 June 2025 (after trading hours)

Issuer : The Company

Placing Agent : Orient Securities Limited

As at the Latest Practicable Date, the Placing Agent and its ultimate beneficial owner(s) are Independent Third Parties.

Placing Period : The period from 19 September 2025 up to 4:00 p.m. on 9 October 2025, or such other dates as the Company may announce, being the period during which the Placing Agent will seek to effect the Unsubscribed Arrangements.

Placing Price : The placing price of the Unsubscribed Rights Shares shall be at least equal to the Subscription Price and the final price determination will depend on the demand for and the market conditions of the Unsubscribed Rights Shares during the placement process.

Placing commission : Subject to the completion of the Placing, the Company shall pay the Placing Agent a placing commission, being 0.5% of the amount which is equal to the Placing Price multiplied by the total number of the Unsubscribed Rights Shares which are successfully placed by the Placing Agent.

Placees : Depending on placees' subscription situations, placees may not be substantial shareholders in order to ensure that the Public Float Requirements are complied. The Unsubscribed Rights Shares are expected to be placed to placees, who are third party independent of, not acting in concert (within the meaning of the Takeovers Code) with and not connected with any directors or substantial shareholders of the Company or its subsidiaries or any of their respective associates; and none of the placees shall be obliged to make a mandatory general offer to the other Shareholders under the Takeovers Code.

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Ranking of the Unsubscribed Rights Shares

: The placed Unsubscribed Rights Shares (when allotted, issued and fully paid, if any) shall rank pari passu in all respects among themselves and with the Shares in issue as at the date of completion of the Placing.

Conditions of the Placing Agreement

: The obligations of the Placing Agent under the Placing Agreement are conditional upon the following conditions being fulfilled:

(i) the Stock Exchange granting the approval for the listing of, and the permission to deal in, the Rights Shares;

(ii) the Rights Issue having been approved by the Shareholders at the EGM by an ordinary resolution;

(iii) all necessary consents and approvals to be obtained on the part of each of the Placing Agent and the Company in respect of the Placing Agreement and the transactions contemplated thereunder having been obtained; and

(iv) the Placing Agreement not having been terminated in accordance with the provisions thereof, including provisions regarding the force majeure events.

None of the above conditions precedent are capable of being waived by the parties to the Placing Agreement. For the avoidance of doubt, if all the Rights Shares are fully subscribed under the Rights Issue, the Placing will not proceed.

The Company shall use its best endeavour to procure the fulfilment of the conditions to the Placing and undertakes to inform the Placing Agent promptly of any matter or circumstance which comes to its attention and indicates that any of such conditions are unable to be fulfilled. If any of such conditions have not been fulfilled by the Placing Long Stop Date (as defined below) or become incapable of being fulfilled (unless extended by mutual consent of the Company and the Placing Agent), then all respective rights, obligations and liabilities of the Company and the Placing Agent in relation to the Placing shall cease and determine, save in respect of any accrued rights or obligations under the Placing Agreement and none of the parties thereto shall have any claim against any other in respect of the Placing.

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Termination

: If any of the following events occur at any time prior to the Placing Long Stop Date, the Placing Agent may (after such consultation with the Company and/or its advisers as the circumstances shall admit or be necessary), by giving a written notice to the Company, at any time prior to the date of completion of the Placing provided that such notice is received by the Company prior to 6:00 p.m. on the Placing Long Stop Date, terminate the Placing Agreement without liability to the other parties and, subject to clauses in the Placing Agreement which survives termination, the Placing Agreement shall thereupon cease to have effect and none of the parties to the Placing Agreement shall have any rights or claims by reason thereof save for any rights or obligations which may accrue under the Placing Agreement prior to such termination:

(a) in the reasonable opinion of the Placing Agent there shall have been since the date of the Placing Agreement such a change in national or international financial, political or economic conditions or taxation or exchange controls as would be likely to prejudice materially the consummation of the Placing; or

(b) the introduction of any new law or regulation or any change in existing law or regulation (or the judicial interpretation thereof) or other occurrence of any matter whatsoever which may adversely affect the business or the financial or trading position or prospects of the Group as a whole; or

(c) any material breach of any of the representations and warranties by the Company comes to the knowledge of the Placing Agent or any event occurs or any matter arises on or after the date of the Placing Agreement and prior to the date of completion of the Placing which if it had occurred or arisen before the date of the Placing Agreement would have rendered any of such representations and warranties untrue or incorrect in any material respect or there has been a material breach by the Company of any other provision of the Placing Agreement; or

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(d) any moratorium, suspension or restriction on trading in shares or securities generally on the Stock Exchange due to exceptional financial circumstances; or

(e) there is any adverse change in the financial position of the Company which in the reasonable opinion of the Placing Agent is material in the context of the Placing.

The Unsubscribed Arrangements are in compliance with the requirements under Rule 7.21(1)(b) under which the No Action Shareholders may be compensated even if they do nothing (i.e. neither subscribe for Rights Shares nor sell their nil-paid rights) given that the Unsubscribed Rights Shares will be first offered to Independent Third Parties and any premium over the Subscription Price will be paid to the No Action Shareholders. The commission payable to the Placing Agent and the related fees and expenses in relation to such placing will be borne by the Company.

The Placing Agent confirms that it is an Independent Third Party. The terms of the Placing Agreement, including the placing commission, were determined after an arm's length negotiation between the Placing Agent and the Company with reference to the prevailing market rate and the Company considers the terms to be normal commercial terms.

The Company considers that the Unsubscribed Arrangements will provide a compensatory mechanism for the No Action Shareholders, protect the interests of the Independent Shareholders, and be fair and reasonable, in the interests of the Company and the Shareholders as a whole.

Given that the Company has put in place the Unsubscribed Arrangements as required by Rule 7.21(1)(b) of the Listing Rules, there will be no excess application arrangements in relation to the Rights Issue as stipulated under Rule 7.21(1)(a) of the Listing Rules.

Conditions of the Rights Issue

The Rights Issue is conditional upon the following conditions:

(1) the Share Consolidation and the Increase in Authorised Share Capital becoming effective;

(2) the delivery to the Stock Exchange and filing and registration with the Registrar of Companies in Hong Kong, the Prospectus Documents in compliance with the Listing Rules and the Companies (Winding-Up and Miscellaneous Provisions) Ordinance not later than the Posting Date;

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LETTER FROM THE BOARD

(3) following registration, the posting of the Prospectus Documents to the Qualifying Shareholders (and where applicable, the posting of the Prospectus to the Non-Qualifying Shareholders, if any, for information purposes only) and the publication of the Prospectus Documents on the website of the Stock Exchange on or before the Posting Date;

(4) the Stock Exchange granting or agreeing to grant (subject to allotment) and not having withdrawn or revoked the listing of, and permission to deal in, the Rights Shares (in their nil-paid and fully-paid forms) by no later than the first day of their dealings;

(5) the Placing Agreement not being terminated pursuant to the terms thereof and remain in full force and effect; and

(6) all other necessary waivers, consents, and approvals (if required) from the relevant governmental or regulatory authorities for the Rights Issue and the transactions contemplated thereunder having been obtained and fulfilled.

None of the above conditions precedent can be waived. If any of the conditions referred to above are not fulfilled at or before 5:00 p.m. on Tuesday, 14 October 2025 (or such later date as the Company may determine), the Rights Issue will not proceed.

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LETTER FROM THE BOARD

As the proposed Rights Issue is subject to the above conditions, it may or may not proceed.

As at the Latest Practicable Date, none of the above conditions has been fulfilled.

Reasons for the Rights Issue and the intended use of proceeds

Assuming that the Rights Issue is fully accepted and no new shares will be allotted or issued on or before the Record Date, the net proceeds of the Rights Issue (the “Net Proceeds”) to be received by the Company, after deducting all estimated expenses payable for the Rights Issue, are estimated to be up to approximately HK$125.73 million. The Directors plan to use such proceeds as to (i) approximately HK$100.58 million, which represents approximately 80% of the Net Proceeds, for repayment of the Group’s current liabilities, specifically those debts, liabilities, or other payables that are expected to be due and payable within twelve months upon Completion, and (ii) approximately HK$25.15 million, which represents approximately 20% of the Net Proceeds, for the Group’s general corporate and administration working capital purposes, which primarily includes (a) staff salaries expenses of approximately HK$22.90 million; (b) rental expenses of approximately HK$0.56 million; and (c) business development expenses of approximately HK$0.43 million. These funds of HK$0.43 million will support the Company’s efforts in smart manufacturing and industrial automation, particularly in upgrading legacy systems and optimizing integrity management within petroleum and petrochemical operations, thereby supporting the Group’s ongoing business activities.

As disclosed in the Company’s annual report for the year ended 31 December 2024, the Group experienced a net loss of approximately RMB73.54 million during the year ended 31 December 2024. As of the same date, the Group reported net current and total liabilities amounting to approximately RMB181.00 million and RMB111.35 million, respectively, with the Group’s bank and cash balances as at 31 May 2025 amounted to approximately RMB15.08 million. These circumstances indicate a material uncertainty that may seriously affect the Group’s ability to continue as a going concern.

Specifically, according to the Group’s unaudited financial position as at 31 May 2025, the Group’s total outstanding bank and other borrowings, including both principal and interest, amount to approximately RMB202.45 million, which are due for repayment within the next twelve (12) months from the date of the Announcement.

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LETTER FROM THE BOARD

As at the Latest Practicable Date, the composition of these outstanding borrowings includes (i) approximately RMB6.07 million in bank loans; and (ii) approximately RMB196.38 million in other borrowings.

(1) The key terms of bank loans are presented below:

| | Lender | Total outstanding borrowings
Approximately | Interest rate | Maturity date |
| --- | --- | --- | --- | --- |
| (i) | Bank of China | RMB4.30 million | 3.60% per annum | March 2024 to March 2026 |
| (ii) | Bank of China | RMB0.76 million | 3.60% per annum | March 2025 to March 2026 |
| (iii) | Industrial and Commercial Bank of China | RMB1.01 million | 2.80% per annum | July 2024 to July 2025 |
| | Total | RMB6.07 million | | |

(2) The key terms of the outstanding other borrowings are presented below:

| | Lender | Identity | Total outstanding borrowings
Approximately | Interest rate | Maturity date |
| --- | --- | --- | --- | --- | --- |
| (i) | Ms. Guo Lei | Non-executive Director | RMB65.51 million | 2.5% to 3.5% per annum | November 2025 to March 2026 |
| (ii) | Mr. Ding Zhigang | Non-executive Director | RMB0.93 million | 2.5% per annum | December 2025 |
| (iii) | Mr. Ning Jun | Shareholder | RMB11.75 million | 3.5% per annum | March 2026 |
| (iv) | Zhongjia Xinda Investment Co., Ltd.*
(中嘉信達投資有限公司), a corporation that is ultimately and beneficially owned by more than 50% by Mr. Ding Zhigang (Note) | Associate of the Company’s connected person | RMB3.00 million | 2.5% per annum | December 2025 |
| (v) | An independent third-party corporation (Note) | Independent third party | RMB110.68 million | 3.5% per annum | August 2025 |
| (vi) | An independent third-party (individual) (Note) | Independent third party | RMB0.92 million | Nil | 31 December 2025 |

LETTER FROM THE BOARD

| | Lender | Identity | Total outstanding borrowings
Approximately | Interest rate | Maturity date |
| --- | --- | --- | --- | --- | --- |
| (vii) | An independent third-party corporation
(Note) | Independent third party | RMB3.59 million | 3.5% per annum | 31 December 2025 |
| | | Total | RMB196.38 million | | |

Note: As of the Latest Practicable Date, Zhongjia Xinda Investment Co., Ltd.* (中嘉信達投資有限公司), the independent third-party (including corporations and individual) do not hold any Share.

The Group plans to use the Net Proceeds to repay the above bank loans first, followed by the above outstanding other borrowings, in accordance with their respective maturity dates, unless the involved parties mutually agree to an extension.

To strengthen the Group's financial position, the Board plans to allocate 80% of the net proceeds to partially reduce outstanding borrowings, thereby improving the overall debt balance. The Group is committed to systematically repaying its remaining borrowings through operating cash flow primarily generated from its core business activities. These activities include but are not limited to the sale of power line communication products, energy-saving and environmental protection solutions, as well as the provision of essential maintenance services for the deployment and upgrades of automated meter reading systems utilized by power grid companies in the PRC.

Further, the Group must maintain sufficient cash reserves for essential expenditures to support ongoing operations and meet compliance obligations. These expenditures include, but are not limited to, legal and professional fees, Directors' remuneration, and staff costs, which amount to a total of not less than HK$6 million. However, according to the latest financial information available to the Board, the Group possesses idle cash reserves of approximately RMB1.4 million. Consequently, the Group must seek to raise additional capital to address its immediate financial commitments and working capital needs.

The Directors believe that the Rights Issue will raise the Group's corporate profile and enhance its capital base, enabling it to expand the scale and scope of its operations further.

Apart from the Rights Issue, the Directors have considered other debt/equity fund raising alternatives such as bank borrowings, placing, or an open offer. The Directors noted that bank borrowings will carry interest costs and may require the provision of security and creditors will rank before the Shareholders, and placings will dilute the interests of Shareholders without allowing them to take part in the exercise. As opposed to an open offer, the Rights Issue enables the Shareholders to sell the nil-paid rights in

33 -

LETTER FROM THE BOARD

the market. The Rights Issue will allow the Qualifying Shareholders to maintain their respective pro-rata shareholding interests in the Company and to continue to participate in the future development of the Company.

Considering the abovementioned alternatives, the Directors consider raising funds through a Rights Issue more attractive in the current market conditions. The Rights Issue will enable the Company to strengthen its working capital base and enhance its financial position while allowing the Qualifying Shareholders to maintain their proportional shareholdings in the Company.

As at the Latest Practicable Date, save as disclosed in this circular, the Company currently (i) does not have any agreement, arrangement, understanding, intention, or negotiation (either concluded or in process) on any potential fundraising activities which will involve issue of equity securities of the Company; and (ii) has no other plan or intention to carry out any future corporate actions in the next twelve months which may have an effect of undermining or negating the intended purpose of the Rights Issue.

Furthermore, as at the Latest Practicable Date, the Company has no intention, understanding, negotiation, or arrangement to downsize, discontinue, or divest any part of its existing business.

Based on the above, the Board considers that raising capital through the Rights Issue is in the interests of the Company and the Shareholders as a whole. In addition, having considered the capital needs of the Group, the terms of the Rights Issue and the Subscription Price, the Board also considers that it is in the interests of the Company to proceed with the Rights Issue on a non-underwritten basis. However, those Qualifying Shareholders who do not take up the Rights Shares to which they are entitled and Non-Qualifying Shareholder(s), if any, should note that their shareholdings will be diluted.

Conclusion

If the proceeds raised by the Rights Issue is less than the aforesaid estimated net proceeds of approximately HK$125.73 million, the Company will allocate the use of proceeds proportionately and will further evaluate options including, amongst others, reducing the proposed investment amount or exploring other financing, and/or fundraising alternatives. The Group is focused on improving its profitability.

4. POSSIBLE ADJUSTMENT TO THE SHARE OPTIONS UNDER THE SHARE OPTION SCHEME

As at the Latest Practicable Date, there were 170,496 outstanding Share Options under the Share Option Scheme. No Share Option was granted to a Director, chief executive (as defined in the Listing Rule) or substantial shareholder of the Company or an associate of any of them under the Share Option Scheme since the adoption of the Share Option Scheme. Pursuant to the terms of the Share Option Scheme, the Rights Issue may lead to adjustments to, among others, the exercise price and/or the number of Shares to be issued upon exercise of the outstanding Share Options under the Share Option Scheme. The Company will notify the holders of such Share Options and the Shareholders by way of announcement (as and when

LETTER FROM THE BOARD

appropriate) regarding adjustments to be made (if any) pursuant to the terms of the Share Option Scheme and such adjustment will be certified by an independent financial adviser or auditors of the Company (as the case may be).

For illustrative purposes only, set out below is the preliminary adjustment in relation to the outstanding Share Options upon the effective of the Share Consolidation and the completion of Rights Issue, using the market price of the Share as at the Latest Practicable Date:

For illustrative purposes only
As at the Latest Practicable Date		Immediately upon the effectiveness of the Share Consolidation		Immediately upon the completion of the Rights Issue
Number of Outstanding Share Options	Exercise price per Share (HK$)	Adjusted exercise price per Share (HK$)	Adjusted number of Shares issuable on the exercise in full of the outstanding Share Options	Adjusted exercise price per Share (HK$)	Adjusted number of Shares issuable on the exercise in full of the outstanding Share Options
170,496	1.724	8.62*Note 1	34,099*Note 1	5.816*Note 2	50,532*Note 2

Notes:

The method of adjustment of the exercise price per Share and the number of Shares on the exercise in full of the outstanding Share Options upon the effectiveness of the Share Consolidation:

Adjusted Exercise Price = Existing Exercise Price x F

Adjusted Number of Share Options = Existing Share Options x F

Where

F = Consolidation Factor

The method of adjustment of the exercise price per Share and the number of Shares on the exercise in full of the outstanding Share Options upon the completion of the Rights Issue:

Adjusted Exercise Price = Existing Share Options (after taking into account the effect of the Share Consolidation) x (1/F)

Adjusted number of Share Options = Existing Options x F

Where

F = CUM/TEEP

CUM = Closing price as shown in the Daily Quotation Sheet of the Exchange on the last day of trading before going Ex-Entitlement

LETTER FROM THE BOARD

$$
\text{TEEP (Theoretical Ex Entitlement Price)} = \frac{(\text{CUM} + (\text{M} \times \text{R}))}{(\text{I} + \text{M})}
$$

$$
M = \text{Entitlement per Consolidated Share}
$$

$$
R = \text{Subscription Price}
$$

As at the Latest Practicable Date, the Company’s current outstanding mandate for the grant of new share options is 6,885,003 Shares, representing 2.69% of the issued share capital of the Company.

Save for the foregoing, as at the Latest Practicable Date, the Company had no outstanding debt securities, derivatives, options, warrants, convertible securities or other similar securities which are convertible or exchangeable into Shares prior to the Record Date. Save for the Rights Issue, the Company has no further intention to issue or grant any Shares, convertible securities, warrants and/or options on or before the Record Date.

5. FUNDRAISING ACTIVITIES IN THE PAST TWELVE MONTHS

The Company has not conducted any equity fundraising activities in the past twelve months immediately prior to the Latest Practicable Date.

6. EFFECTS ON THE SHAREHOLDING STRUCTURE OF THE COMPANY

The following table sets out the possible changes in the Company’s shareholding structure arising from the Rights Issue, which are for illustrative purposes only. Below is the illustration of the Company’s shareholding structure, including

(i) as of the Latest Practicable Date;

(ii) immediately upon completion of the Share Consolidation, assuming there is no change to the total issued share capital of the Company on or before the EGM (“Scenario 1”);

(iii) immediately after Completion, assuming (a) all Qualifying Shareholders will take up their respective entitlements of the Rights Issue in full; and (b) there is no change to the total issued share capital of the Company on or before the Record Date (“Scenario 2”);

(iv) immediately after Completion, assuming (a) except for Ms. Liu Beibei, Ms. Fu Xiaoqin, Mr. Ding Zhigang, Mr. Yu Lu, and Mr. Tsang Wah Tak Brian, no Qualifying Shareholders takes up any of his/her/its entitlements under the Rights Issue; (b) none of the Unsubscribed Rights Shares are taken up by independent placee(s) under the Unsubscribed Arrangements; (c) there is no change to the total issued share capital of the Company on or before the Record Date; and (d) the application of Mr. Ding Zhigang, Mr. Yu Lu, and Mr. Tsang Wah Tak Brian for their assured entitlement under the Rights Issue has been scaled down to a level that does not result in the non-compliance of the Public Float Requirement (“Scenario 3”); and

LETTER FROM THE BOARD

(v) immediately after Completion, assuming (a) none of the Qualifying Shareholders will take up their respective entitlements of the Rights Shares; (b) the Placing Agent will successfully place all the Unsubscribed Rights Shares under the Placing, and (c) there is no change to the total issued share capital of the Company on or before the Record Date ("Scenario 4").

	As of the Latest Practicable Date		Scenario 1		Scenario 2		Scenario 3 (Note 4)		Scenario 4 (Notes 3, 5)
	Number of Shares	Approximate Shareholding percentage	Number of Shares	Approximate Shareholding percentage	Number of Shares	Approximate Shareholding percentage	Number of Shares	Approximate Shareholding percentage	Number of Shares	Approximate Shareholding percentage
Substantial Shareholders
Liu Beibei	33,772,112	13.21%	6,754,423	13.21%	40,526,538	13.21%	29,083,742	24.12%	6,754,423	2.20%
Fu Xiaoqin	33,000,000	12.90%	6,600,000	12.90%	39,600,000	12.90%	28,418,816	23.57%	6,600,000	2.15%
Directors
Ding Zhigang (Note 2)	19,670,092	7.69%	3,934,018	7.69%	23,604,108	7.69%	16,939,413	14.05%	3,934,018	1.28%
Yu Lu (Note 2)	17,252,250	6.75%	3,450,450	6.75%	20,702,700	6.75%	14,857,227	12.32%	3,450,450	1.12%
Tsang Wah Tak Brian (Note 1)	1,315,000	0.51%	263,000	0.51%	1,578,000	0.51%	1,132,447	0.94%	263,000	0.09%
Public Shareholders
Ning Jun (Note 7)	20,280,000	7.93%	4,056,000	7.93%	24,336,000	7.93%	4,056,000	3.36%	4,056,000	1.32%
The Places (Note 6)	—	—	—	—	—	—	—	—	255,728,860	83.33%
Other public Shareholders	130,439,406	51.01%	26,087,881	51.01%	156,527,286	51.01%	26,087,881	21.64%	26,087,881	8.50%
	255,728,860	100.00%	51,145,772	100.00%	306,874,632	100.00%	120,575,526	100.00%	306,874,632	100.00%

Notes:
1. Mr. Tsang Wah Tak Brian is an executive Director.
2. Both Mr. Ding Zhigang and Mr. Yu Lu are non-executive Directors.
3. This scenario is for illustrative purposes only. The Company has entered into the Placing Agreement, pursuant to which the Placing Agent has conditionally agreed to procure Placee(s), on a best-effort basis, to subscribe for the Unsubscribed Rights Shares.
4. Assuming (a) except for Ms. Liu Beibei, Ms. Fu Xiaoqin, Mr. Ding Zhigang, Mr. Yu Lu, and Mr. Tsang Wah Tak Brian, no Qualifying Shareholders takes up any of his/her/its entitlements under the Rights Issue; (b) none of the Unsubscribed Rights Shares are taken up by independent placee(s) under the Unsubscribed Arrangements; and (c) there is no change to the total issued share capital of the Company on or before the Record Date; upon Completion, there will be 30,143,881 Shares held by public Shareholders, representing approximately $19.30\%$ of the total issued Shares as enlarged by the allotment of the Rights Shares, which will be below the Public Float Requirement. In that case, the application of Mr. Ding Zhigang, Mr. Yu Lu, Mr. Tsang Wah Tak Brian, Ms. Liu Beibei and Ms. Fu Xiaoqin for their assured entitlement under the Rights Issue will be adjusted and scaled down to a level that does not result in the non-compliance of the Public Float Requirement.

As a result, the total number of shares held by Ms. Liu Beibei, Ms. Fu Xiaoqin, Mr. Ding Zhigang, Mr. Yu Lu, and Mr. Tsang Wah Tak Brian will be reduced to the number of shares as presented in Scenario 3 above. The Company is committed to maintaining compliance with the Public Float Requirement at all times.

LETTER FROM THE BOARD

In the extreme case as illustrated in Scenario 4 above, assuming that (a) none of the Qualifying Shareholders take up their respective entitlements of the Rights Shares; (b) the Placing Agent successfully places all the Unsubscribed Rights Shares to a single placee under the Placing; and (c) there is no change to the total issued share capital of the Company on or before the Record Date, upon Completion, only 26,087,881 Shares will be held by public Shareholders, representing approximately 8.50% of the total issued Shares as enlarged by the allotment of the Rights Shares, which falls below the minimum public float requirement under Rule 8.08(1). In such case, placing agent will determine to allocate such number of Unsubscribed Rights Shares to the single placee in order to ensure the compliance with the Public Float Requirements.

In other situation, when there is more than one placee, depending on placees' subscription situation, if the Public Float Requirements may not be met, the restriction that placees shall not be substantial shareholders may apply.

Upon receipt of subscription applications from placees under the Placing, the placing agent shall be obliged to thoroughly review such applications to ensure that the Public Float Requirements are complied.

Pursuant to the Placing Agreement, depending on placees' subscription situations, placees may not be substantial shareholders in order to ensure that the Public Float Requirements are complied. The Unsubscribed Rights Shares are expected to be placed to placees, who are third party independent of, not acting in concert (within the meaning of the Takeovers Code) with and not connected with any directors or substantial shareholders of the Company or its subsidiaries or any of their respective associates; and none of the placees shall be obliged to make a mandatory general offer to the other Shareholders under the Takeovers Code.
Mr. Ning Jun holds 20,280,000 Shares, representing 7.93% of the issued Shares of the Company as at the Latest Practicable Date, thus is not a Substantial Shareholder and not a core connected person of the Company. In addition, Ning Jun does not fall within any of the categories specified under Rule 8.24 of the Listing Rules and is therefore regarded as a public Shareholder.

7. LISTING RULES IMPLICATIONS

As the Rights Issue will increase the total issued share capital of the Company by more than 50% within the 12 months immediately preceding the Latest Practicable Date, the Rights Issue is conditional on minority Shareholders' approval at the EGM under the requirements of Rule 7.19A of the Listing Rules.

Pursuant to Rule 7.27A(1) of the Listing Rules, where Shareholders' approval is required for a rights issue under rule 7.19A, the Rights Issue must be made conditional on approval by the Shareholders in general meeting by a resolution on which any controlling shareholders and their associates or, where there are no controlling shareholders, Directors (excluding independent non-executive Directors) and the chief executive of the Company and their respective associates shall from voting in favour of the Rights Issue.

As of the Latest Practicable Date, the Company does not have any controlling shareholder as defined under the Listing Rules. However, each of Mr. Tsang Wah Tak, Brian (executive Director), Mr. Yu Lu, and Mr. Ding Zhigang (both non-executive Directors) holds a beneficial interest in 1,315,000 Shares, 17,252,250 Shares, and 19,670,092 Shares, respectively. As part of the intended use of the Net Proceeds, a portion of the Net Proceeds will be used to partially settle the Group's outstanding borrowings. Mr. Ning Jun, a public Shareholder who does not fall within any of the categories under Rule 8.24 of the Listing Rules, has been identified as one of the Group's creditors whose debt is to be repaid by the Company. To avoid any conflict of interest, Mr. Ning Jun, together with Mr. Tsang Wah Tak, Brian, Mr. Yu Lu, and Mr. Ding Zhi Gang, will be required to abstain from voting in favour of the proposed resolutions to approve the Rights Issue and the transaction contemplated thereunder at the EGM. Save as the above disclosure, no Shareholders and Directors are required to abstain from voting in favour of the proposed resolution approving the Rights Issue and the transaction contemplated thereunder at the EGM.

LETTER FROM THE BOARD

8. EGM

The EGM will be held at Units 5906–12, 59/F, The Center, 99 Queen’s Road Central, Hong Kong, on Thursday, 14 August 2025 at 10:00 a.m. for the purpose of approving, the Share Consolidation, Increase in Authorised Share Capital, the Rights Issue and the transactions contemplated thereunder. A notice convening the EGM is set out on page EGM-1 to page EGM-4 of this circular. A form of proxy for use at the EGM is enclosed herewith.

Whether or not you intend to attend the EGM, you are requested to complete the enclosed form of proxy in accordance with the instructions printed thereon and return the same to the Registrar at Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong, as soon as possible but in any event not less than 48 hours before the time scheduled for the EGM or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending or voting in person at the EGM or any adjourned meeting thereof should you so wish.

The register of members of the Company will be closed from Friday, 8 August 2025 to Thursday, 14 August 2025 (both days inclusive) for determine the eligibility of the Shareholders to attend and vote at the EGM. In order to qualify for attendance and voting at the EGM, all completed transfer forms accompanied by the relevant share certificates must be lodged with the Registrar at Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong for registration no later than 4:30 p.m. on Thursday, 7 August 2025.

In compliance with the Listing Rules, all the resolutions to be proposed at the EGM will be voted on by way of poll at the EGM.

Subject to the approval of the Rights Issue by the Independent Shareholders at the EGM, the Prospectus containing further information regarding, among other things, the Rights Issue (including information on acceptances of the Rights Shares), PAL(s) are expected to be despatched to the Qualifying Shareholders on Thursday, 28 August 2025.

9. TYPHOON OR BLACK RAINSTORM WARNING ARRANGEMENTS

If typhoon signal No. 8 or above, or a black rainstorm warning is in effect at 7:30 a.m. on the date of the EGM, the meeting will be postponed. The Company will post an announcement on its website (www.risecomm.com.cn) and designated website of the Stock Exchange (www.hkexnews.hk) to notify the Shareholders of the date, time and place of the rescheduled meeting.

10. FURTHER INFORMATION

Your attention is drawn to (i) letter from the Independent Board Committee which contains the recommendation from the Independent Board Committee to the Independent Shareholders regarding the resolution to approve the Rights Issue, the Placing Agreement and the transactions contemplated thereunder; and (ii) the letter from the Independent Financial Adviser which contains its advice to the Independent Board Committee and the Independent Shareholders regarding the Rights Issue, the Placing Agreement and the transactions contemplated thereunder.

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LETTER FROM THE BOARD

11. RECOMMENDATION

The Independent Board Committee, which comprises all the independent non-executive Directors, has been established to advise the Independent Shareholders as to whether the terms of the Rights Issue and the transactions contemplated thereunder are on normal commercial terms, fair and reasonable so far as the Independent Shareholders are concerned and in the interest of the Company and the Shareholders as a whole and to make recommendations to the Independent Shareholders on how to vote at the EGM.

12. ADDITIONAL INFORMATION

Your attention is drawn to the additional information set out in the appendices to this circular.

WARNING OF THE RISK OF DEALINGS IN THE SHARES AND RIGHTS SHARES IN NIL-PAID FORM

The Rights Issue is subject to the fulfilment of conditions including, among other things, the Stock Exchange granting the listing of, and permission to deal in, the Rights Shares in their nil-paid and fully-paid forms. Please refer to the section headed "Conditions of the Rights Issue" in this circular.

Shareholders and potential investors of the Company should note that if the conditions of the Rights Issue are not satisfied, the Rights Issue will not proceed. Any dealings in the Shares from the Latest Practicable Date up to the date on which all the conditions of the Rights Issue are fulfilled, and any Shareholders dealing in the Rights Shares in nil-paid form will accordingly bear the risk that the Rights Issue may not become unconditional or may not proceed.

Subject to the fulfilment of conditions, the Rights Issue will proceed on a non-underwritten basis irrespective of the level of acceptance of provisionally allotted Rights Shares. Accordingly, if the Rights Issue is undersubscribed, the size of the Rights Issue will be reduced. Qualifying Shareholders who do not take up their assured entitlements in full and Non-Qualifying Shareholders, if any, should note that their shareholding in the Company may be diluted, the extent of which will depend in part on the size of the Rights Issue.

Shareholders and potential investors of the Company are advised to exercise caution when dealing in the Shares and/or the Rights Shares. Any Shareholders or other persons contemplating any dealings in the Shares and/or Rights Shares in nil-paid form are recommended to consult their professional advisers.

By Order of the Board
Risecomm Group Holdings Limited
Zhao Luyi
Chairman and executive Director

40 -

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

RISECOMM

瑞斯康

RISECOMM GROUP HOLDINGS LIMITED

瑞斯康集團控股有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 1679)

23 July 2025

To the Independent Shareholders

Dear Sir or Madam,

PROPOSED RIGHTS ISSUE ON THE BASIS OF FIVE (5) RIGHTS SHARES OF EVERY ONE (1) CONSOLIDATED SHARE HELD ON THE RECORD DATE ON A NON-UNDERWRITTEN BASIS

We refer to the circular of the Company dated 23 July 2025 (the "Circular") of which this letter forms part. Unless the context specifies otherwise, capitalised terms used herein have the same meanings as defined in the Circular.

We have been appointed by the Board as the Independent Board Committee to advise the Independent Shareholders as to whether the terms of the Rights Issue and the transactions contemplated thereunder are on normal commercial terms, in the interests of the Company and the Shareholders as a whole, and the terms of which are fair and reasonable insofar as the Independent Shareholders are concerned, and to advise the Independent Shareholders on how to vote at the EGM.

Silverbricks Securities Co. Limited has been appointed as the Independent Financial Adviser to advise us and the Independent Shareholders in this respect. Having taken into account the terms of the Rights Issue, and the advice from the Independent Financial Adviser as set out on pages 42 to 63 of this circular, we are of the opinion that the terms of the Rights Issue and the transactions contemplated thereunder are on normal commercial terms, fair and reasonable so far as the Company and the Independent Shareholders are concerned and in the interests of the Company and the Shareholders as a whole. Accordingly, we recommend the Independent Shareholders to vote in favour of the resolutions to be proposed at the EGM to approve the Rights Issue and the transactions contemplated thereunder.

Yours faithfully,

For and on behalf of

The Independent Board Committee

Mr. Victor Yang

Ms. Lo Wan Man

Mr. Zou Heqiang

Independent non-executive Directors

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

The following is the full text of the letter of advice from Silverbricks Securities Company Limited, the Independent Financial Adviser, which sets out its advice to the Independent Board Committee and Independent Shareholders prepared for the purpose of inclusion in this circular.

元庫證券有限公司
SILVERBRICKS SECURITIES CO., LTD.

Rooms 1601-07,
16/F, Nan Fung Tower,
88 Connaught Road Central,
Central, Hong Kong

23 July 2025

To the Independent Board Committee and the Independent Shareholders

Dear Sirs,

PROPOSED RIGHTS ISSUE ON THE BASIS OF FIVE (5) RIGHTS SHARES OF EVERY ONE (1) CONSOLIDATED SHARE HELD ON THE RECORD DATE ON A NON-UNDERWRITTEN BASIS

INTRODUCTION

We refer to our engagement as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in respect of the Rights Issue, particulars of which are set out in the letter from the Board (the "Letter from the Board") contained in the circular of the Group to the Shareholders dated 23 July 2025 (the "Circular"), of which this letter forms part. Unless the context requires otherwise, capitalized terms used in this letter shall have the same meanings as given to them under the definitions section of the Circular.

Reference is made to the Announcement. Subject to the Share Consolidation and the Increase in Authorised Share Capital becoming effective, the Board proposes to raise gross proceeds of up to approximately HK$127.86 million, net of expenses, through a Rights Issue of 255,728,860 Rights Shares at the Subscription Price of HK$0.5 per Rights Share based on five (5) Rights Shares for every one (1) Consolidated Share held by the Qualifying Shareholders on the Record Date.

Pursuant to Rule 7.27A(1) of the Listing Rules, where Shareholders' approval is required for a rights issue under rule 7.19A, as the Rights Issue will increase the number of the issued Shares by more than 50%, the Rights Issue must be made conditional on approval by Independent Shareholders in general meeting by a resolution on which any controlling Shareholders and their associates or, where there are no controlling Shareholders, the Directors (excluding the independent non-executive Directors) and the chief executive of the Company and their respective associates shall abstain from voting in favour of the ordinary resolution to approve the Rights Issue at the EGM.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

As at the Latest Practicable Date, the Company does not have any controlling shareholder as defined under the Listing Rules. However, each of Mr. Tsang Wah Tak, Brian (executive Director), Mr. Yu Lu, and Mr. Ding Zhigang (both non-executive Directors) holds a beneficial interest in 1,315,000 Shares, 17,252,250 Shares, and 19,670,092 Shares, respectively. As part of the intended use of the Net Proceeds, a portion of the Net Proceeds will be used to partially settle the Group's outstanding borrowings. Mr. Ning Jun, a public Shareholder who does not fall within any of the categories under Rule 8.24 of the Listing Rules, has been identified as one of the Group's creditors whose debt is to be repaid by the Company. To avoid any conflict of interest, Mr. Ning Jun, together with Mr. Tsang Wah Tak, Brian, Mr. Yu Lu, and Mr. Ding Zhi Gang, will be required to abstain from voting in favour of the proposed resolutions to approve the Rights Issue and the transaction contemplated thereunder at the EGM. Save as the above disclosure, no Shareholders and Directors are required to abstain from voting in favour of the proposed resolution approving the Rights Issue and the transaction contemplated thereunder at the EGM.

THE INDEPENDENT BOARD COMMITTEE

The Independent Board Committee comprising all the independent non-executive Directors, namely Mr. Victor Yang, Ms. Lo Wan Man, Mr. Zou Heqiang, has been established to advise the Independent Shareholders as to whether the terms of the Rights Issue, the Placing Agreement and the transactions contemplated respectively thereunder are fair and reasonable and in the interests of the Company and the Shareholders as a whole, and to advise the Independent Shareholders on how to vote at the EGM, taking into account the recommendations of the Independent Financial Adviser appointed by the Company. In this connection, the Company has appointed the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders as to whether the terms of the Rights Issue, the Placing Agreement and the transactions contemplated respectively thereunder are fair and reasonable. We, Silverbricks Securities Company Limited, have been appointed as the Independent Financial Adviser with the approval of the Independent Board Committee in accordance with the Rule 13.84 of the Listing Rules to advise the Independent Board Committee and the Independent Shareholders in these regards and to give our opinion for the Independent Board Committee's consideration when making their recommendations to the Independent Shareholders.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

As at the Latest Practicable Date, we are not connected with the Directors, chief executive and substantial shareholders of the Company or any of their respective subsidiaries or their respective associates and, as at the Latest Practicable Date, did not have any shareholding, directly or indirectly, in any of their respective subsidiaries or their respective associates and did not have any shareholding, directly or indirectly, in any member of the Group or any right, whether legally enforceable or not, to subscribe for or to nominate persons to subscribe for securities in any member of the Group. We are not aware of any relationships or interests between us and the Company or any other parties that could be reasonably be regarded as hindrance to our independence as defined under Rule 13.80 of the Listing Rules to act as the Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders in respect of the proposed Rights Issue of the Company. Apart from normal professional fees payable to us in connection with this appointment, no arrangements exist whereby we had received or will receive any fee or benefit from the Group and its associates. During the past two years, we did not have any relationship with or interest in the Company or any other parties that could reasonably be regarded as relevant to our independence. Accordingly, we consider that we are eligible to give independent advice on the proposed Rights Issue and the transactions contemplated thereunder of the Company.

BASIS OF OUR OPINION

In forming our opinion and recommendation, we have relied on the information, facts and representations contained or referred to in the Circular and the information, facts and representations provided by, and the opinions expressed by the Directors, management of the Company and its subsidiaries. We have no reason to believe that any information and representations relied on by us in forming our opinion is untrue, inaccurate or misleading, nor are we aware of any material facts the omission of which would render the information provided and the representations made to us untrue, inaccurate or misleading.

We have assumed that all information, facts, opinions and representations made or referred to in the Circular were true, accurate and complete at the time they were made and continued to be true, accurate and complete as at the date of the Circular and that all expectations and intentions of the Directors, management of the Company and its subsidiaries, will be met or carried out as the case may be. We have no reason to doubt the truth, accuracy and completeness of the information, facts, opinions and representations provided to us by the Directors, management of the Company and its subsidiaries. The Directors have confirmed to us that no material facts have been omitted from the information supplied and opinions expressed. We have no reason to doubt that any relevant material facts have been withheld or omitted from the information provided and referred to in the Circular or the reasonableness of the opinions and representations provided to us by the Directors, management of the Company and its subsidiaries. We will notify the shareholders of any material change of information in the circular up to the date of EGM.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

We have also sought and received confirmation from the Directors that no material facts have been omitted from the information supplied and opinions expressed. We have relied on such information and opinions and have not, however, conducted any independent verification of the information provided, nor have we carried out any independent investigation into the business, financial conditions and affairs of the Group or its future prospect.

The Directors have collectively and individually accepted full responsibility for the accuracy of the information contained in the Circular and have confirmed, having made all reasonable enquiries, that to the best of their knowledge, opinions expressed in the Circular have been arrived at after due and careful consideration and there are no other facts not contained in the Circular, the omission of which would make any statement in the Circular misleading.

In formulating our opinion, we have not considered the taxation implications on Independent Shareholders in relation to the subscription for, holding or disposal of the Rights Shares, since these are particular to their individual circumstances. It is emphasised that we will not accept responsibility for any tax effects on, or liabilities of any person resulting from the subscription for, holding or disposal of the Rights Shares. In particular, Independent Shareholders subject to overseas taxation or Hong Kong taxation on securities dealings should consider their own tax position and, if in any doubt, should consult their own professional advisers.

We consider that we have reviewed all currently available information and documents, among others: (i) the Placing Agreement; (ii) total outstanding bank and other borrowings details of approximately RMB202.45 million as at 31 May 2025 due for repayment within the next twelve (12) months; (iii) unaudited financial position of the Group as at 31 May 2025; and (iv) annual report of the Company for the year ended 31 December 2024 (the "2024 Annual Report"), which are made available to us and enable us to reach an informed view and to justify our reliance on the information provided so as to provide a reasonable basis for our advice. Based on the foregoing, we confirm that we have taken all reasonable steps, which are applicable to the Rights Issue, as referred to in Rule 13.80 of the Listing Rules (including the notes thereto).

This letter is issued for the information for the Independent Board Committee and the Independent Shareholders solely in connection with their consideration of the Rights Issue and, except for its inclusion in the Circular, is not to be quoted or referred to, in whole or in part, nor shall this letter be used for any other purposes, without our prior written consent.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

PRINCIPAL FACTORS AND REASONS CONSIDERED

In arriving at our opinion regarding the Rights Issue, we have considered the following principal factors and reasons:

1. Background information of the Group

The Group is principally engaged in the research, development, production and sales of power line communication products and the provision of smart manufacturing & industrial automation services (SMIA) and products. Set out below is a summary of the consolidated financial information of the Group for the years ended 31 December 2023 ("FY2023") and 31 December 2024 ("FY2024") as extracted from the 2024 Annual Report.

(a) Financial Performance of the Group

	For the year ended 31 December
	2024	2023
	RMB'000	RMB'000
	(audited)	(audited)
Revenue	122,298	94,868
Gross profit	37,094	15,568
Loss before tax	(72,235)	(120,436)
Loss for the year	(73,543)	(143,648)

(b) Financial Position of the Group

	As at 31 December
	2024	2023
	RMB'000	RMB'000
	(audited)	(audited)
Total assets	236,573	250,488
Current Assets	108,129	152,513
— Bank and cash balances	15,183	35,919
Total liabilities	347,919	285,021
Non-current liabilities	58,785	114,622
— Borrowings	56,940	108,705
Current liabilities	289,134	170,399
— Borrowings	190,204	76,587
Net liabilities	(111,346)	(34,533)

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Audited consolidated results for the two years ended 31 December 2024

As disclosed in the 2024 Annual Report, revenue of the Group increased by approximately 28.91% from approximately RMB94.87 million for FY2023 to approximately RMB122.30 million for FY2024. Such an increase was derived from a revenue growth of approximately 58.43% from the new automated meter reading (AMR) new product trading with other business segments, along with a contribution of around 20.76% from the newly provided wind farm operation and maintenance (WFOM) service to new region. Gross profit increased by approximately 138.27% to approximately RMB37.09 million for FY2024 from approximately RMB15.57 million for FY2023 which was still mainly attributable from the growth in AMR and WFOM segments. New products and new services require establishing sales channels for distributing circuits and modules and further marketing expenses that led to an increase in selling and marketing expenses of approximately 69.80%. The gross margin has increased from 16.41% to 30.33% which signifies there is an improvement in sales and better control in expenses. As a result of the improvement in revenue and gross profit margin, the loss for the Group decreased approximately 48.80%, from approximately RMB143.65 million for FY2023 to approximately RMB73.54 million for FY2024.

The total assets of the Group amounted to approximately RMB236.57 million FY2024, representing a decrease of approximately 5.56%, as compared to RMB250.49 million for FY2023. The decrease was primarily due to the decrease in bank and cash equivalents of approximately RMB20.74 million. The total liabilities of the Group amounted to approximately RMB347.92 million for FY2024, representing an increase of approximately 22.07%, as compared to RMB285.02 million for FY2023. The increase was primarily due to the increase in borrowings of approximately RMB61.85 million. The net liabilities of the Company amounted to approximately RMB111.35 million FY2024, representing an increase of approximately RMB76.81 million or approximately 222.43%, as compared to RMB34.53 million for FY2023. Such an increase was mainly attributable to the total amounts of other borrowings during the year ended 31 December 2024.

2. Reasons for and benefits of the Rights Issue and use of proceeds

As disclosed in the Letter from the Board, the net proceeds from the Rights Issue are estimated to be up to approximately HK$125.73 million after the deduction of all estimated expenses (assuming full acceptance of the Rights Issue and assuming that no new Shares will be allotted or issued on or before the Record Date).

The Company intend to apply the net proceeds as follows:

(i) approximately HK$100.58 million, which represents approximately 80% of the Net Proceeds, for repayment of the Group's current liabilities, specifically those debts, liabilities, or other payables that are expected to be due and payable within twelve months upon Completion; and

(ii) approximately HK$25.15 million, which represents approximately 20% of the Net Proceeds, for the Group's general corporate and administration working capital purposes, which primarily includes (a) staff salaries expenses of

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

approximately HK$22.90 million; (b) rental expenses of approximately HK$0.56 million; and (c) business development expenses of approximately HK$0.43 million, all supporting the Group's ongoing business activities.

In the event that there is an under subscription of the Right Issue and Placing, the net proceeds of the Rights Issue and Placing will be allocated and utilised in accordance with the same proportion to the above basis.

As stated in the section headed "1. Background information of the Group" above, despite the increase in revenue and gross profit over the years, the Group has recorded consecutive losses attributable to the Shareholders during the two years ended 31 December 2023 and 2024. The losses are primarily attributable to the increase in selling and marketing expenses, the research and development expenses, as well as the impairment losses on prepayment and the loss on early termination of leases.

In the event that the proceeds raised by the Rights Issue or Placing is less than the aforesaid estimated net proceeds of approximately HK$125.73 million, the Company may further evaluate options including amongst others, reducing the proposed amount of repayment of loans and other payables, renewing and/or refinancing existing loans or exploring other financing, and/or fund-raising alternatives. The Group's is minded to improve its profitability and alleviate the repayment pressure by, among other things, lowering liabilities and finance costs.

Settlement of the Group's loans

For FY2024, the Group was in a highly leveraged financial position (i.e. Debt ratio = 147.07%), the Group had total outstanding bank and other borrowings, which the repayment will be due within the next twelve months from the Last Trading Day, amount to approximately RMB202.45 million as at 31 May 2025, including (i) bank loan of approximately RMB6.07 million, with effective interest rates ranging from 2.80% to 3.60% per annum. These bank loan, which include facilities from Bank of China and Industrial and Commercial Bank of China, maturing from July 2024 to March 2026; and (ii) other borrowings (including amounts due to directors, shareholders, associate of the Company's connected person, and independent third parties) of approximately RMB196.38 million with effective interest rates ranging from 0% to 3.5% per annum. Most of these other borrowings are set to mature between August 2025 and March 2026, with RMB109.93 million in nearly 56.0% of the total owed to an independent third party and maturing in August 2025. Despite this significant debt load, the Group's cash and bank balances remain limited and was approximately RMB15.18 million as of FY2024 and was approximately RMB15.08 million as of 31 May 2025 from the unaudited consolidated financial statement, underscoring a leveraged financial position and raising concerns over the sufficiency of liquidity to meet short term obligations as they fall due. With the high effective interest rates on certain borrowings, the Group's exposure to refinancing and liquidity risks in the near term results in the need for fund raising to relieve its liquidity pressure and finance costs burden. Therefore, the Group intends to

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

utilize the net proceeds to first repay the aforementioned bank loans, followed by the outstanding other borrowings, in alignment with their respective maturity dates, unless an extension is mutually agreed upon by the involved parties.

In addition, as stated in the 2024 Annual Report, taking into account that (i) the Group incurred a net loss of approximately RMB73.54 million for FY2024; (ii) the Group's current liabilities exceeded its current assets by approximately RMB181.0 million for FY2024; (iii) the reduction of interest payment after the settlement of the Group's borrowings; (iv) the balance of bank and cash equivalents for FY2024; and (v) the positive impact of increasing liquidity and reserving working capital brought by settlement of the Group's indebtedness. As such, we concur with the Directors that 80% of the net proceeds of approximately HK$100.58 million (i.e. RMB91.44 million, HK$1.10 = RMB1.00 on the Last Trading Day of Hong Kong Association of Bank: https://www.hkab.org.hk/en/rates/exchange-rates), can partially settle the outstanding borrowings without additional financial burden to the Group. In this regard, the Rights Issue could provide sufficient funds at no borrowing costs for the Group to satisfy its funding needs in redemption of its outstanding borrowings and the conduct of the Group's ordinary business.

Having considered that (i) the significant amount of total borrowing amount with interest for the Group as of 31 May 2025 (i.e. RMB202.45 million); (ii) the reduction of interest payment after the settlement of the Group's loan; (iii) the balance of bank and cash equivalents as at 31 December 2024 and as of 31 May 2025; and (iv) the positive impact of increasing liquidity and reserving working capital brought by settlement of the Group's indebtedness, we concur with the Directors that the settlement of the Group's loans equip the Group with a timely and robust funding position and is for the commercial benefit of the Group.

General Corporate and Administrative Working Capital Purposes

As discussed with the management of the Company, the Group has new demands from the market as (i) won certain major biddings for sales of its products to dew provinces in China; (ii) new testing technologies inventing in Smart Manufacturing & Industrial Automation ("SMIA") field; and (iii) new service providing in WFOM which led to the expenses rises. Therefore, the Company intends to apply approximately HK$25.15 million (i.e. RMB22.86 million, HK$1.10 = RMB1.00 on the Last Trading Day of Hong Kong Association of Bank: https://www.hkab.org.hk/en/rates/exchange-rates) for settling staff salaries, rental expenses and further exploring or upgrading the spectrum for the Company businesses in SMIA and WFOM to reach the new market demands.

Having considered the above, and (i) the positive businesses demanding from the market in the research, development, production and sales of power line communication products and the provision of SMIA and products; (ii) to support and facilitate the Group's daily operations and cover the Group's essential expenditures including staff salaries and employees benefits, rental expenses, legal and professional fees, registrar fees, office overheads and other general and administrative expenses; and (iii) the uncertainty in going concern of the Group's financial ability, we concur with the Directors

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

that the Group's ongoing operations and managing cash flow is a very critical aspect during a period of uncertainty, and the Rights Issue provides a good opportunity for the Group to strengthen its capital structure without incurring debt financing cost, improve the financial position, and provide additional financial resources for the Group's daily operation. We are of the view that the intended use of proceeds is fair and reasonable.

Alternative financing methods

As disclosed in the Letter from the Board, apart from the Rights Issue, the Directors have considered other debt/equity fund raising alternatives such as bank borrowings, placing or an open offer. The Directors noted that bank borrowings will carry interest costs and may require the provision of security and creditors will rank before the Shareholders, and placings will dilute the interests of Shareholders without giving them the opportunity to take part in the exercise. As opposed to an open offer, the Rights Issue enables the Shareholders to sell the nil-paid rights in the market. The Rights Issue will give the Qualifying Shareholders the opportunity to maintain their respective pro-rata shareholding interests in the Company and to continue to participate in the future development of the Company.

Having considered the abovementioned alternatives, the Directors consider raising funds by way of the Rights Issue is more attractive in the current market condition and the Rights Issue will enable the Company to strengthen its working capital base and enhance its financial position, while at the same time, allowing the Qualifying Shareholders to maintain their proportional shareholdings in the Company.

After taking into account the benefits and potential cost of each of the alternatives such as bank borrowings, placing or an open offer, we are of the view and concur with the view of the Directors that (i) debt financing may not be achievable on favourable terms in a timely manner as the company has carried a large amount of debt financing while debt financing requires asset pledge or relatively higher interest rate which will result in additional interest burden, higher gearing ratio of the Group; (ii) placing of new Shares would only be available to certain places who are not necessarily the existing Shareholders and would dilute the shareholding of the existing Shareholders; and (iii) open offer does not allow qualifying shareholders to trade rights entitlements freely in the open market. We are of the view and concur with the view of the Directors that the Rights Issue is more cost effective, efficient and beneficial to the Company and the Shareholders as a whole as compared to raising fund by other means.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

3. Principal terms of the Rights Issue

Set out below is a summary of the principal terms of the Rights Issue, further details of which are set out in the Letter from the Board:

Basis of the Rights Issue:
five (5) Rights Shares for every one (1) Consolidated Share held by the Qualifying Shareholders at the close of business on the Record Date

Subscription Price:
HK$0.5 per Rights Share

Number of Rights Shares to be issued pursuant to the Rights Issue:
Up to 255,728,860 Rights Shares (assuming there is no further issue or repurchase of new Shares between the Latest Practicable Date and the Record Date)

Gross proceeds from the Rights Issue:
Up to approximately HK$127.86 million before expenses (assuming there is no further issue or repurchase of new Shares between the Latest Practicable Date and the Record Date and all Rights Shares are taken up by the Qualifying Shareholders or the Unsubscribed Rights Shares are successfully placed by the Placing Agent under the Placing)

Assuming there is no change to the total issued shares capital of the Company on or before the Record Date, 255,728,860 Rights Shares to be issued pursuant to the terms of the Rights Issue represents (i) 500% of the total issued share capital of the Company (after taking into account the effect of the Share Consolidation) as at the Latest Practicable Date; and (ii) approximately 83.33% of the total issued share capital of the Company (after taking into account the effect of the Share Consolidation) as enlarged by the allotment and issuance of the Rights Shares.

As at the Latest Practicable Date, there were 170,496 outstanding Share Options under the Share Option Scheme. Save for the foregoing, as at the Latest Practicable Date, the Company had no outstanding convertible bonds, options, derivatives, warrants, conversion rights or other similar rights entitling holders thereof to subscribe for or convert into or exchange for new Shares prior to the Record Date. Save for the Rights Issue, the Company has no further intention to issue or grant any Shares, convertible securities, warrants and/or options on or before the Record Date.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Assessment on the principal terms of the Rights Issue

The Subscription Price

The Subscription Price represents:

(i) a discount of approximately 37.11% to the theoretical closing price of HK$0.795 per Consolidated Share (after taking into account the effect of the Share Consolidation) as quoted on the Stock Exchange on the Latest Practicable Date;

(ii) a discount of approximately 22.48% to the theoretical closing price of HK$0.645 per Consolidated Share (after taking into account the effect of the Share Consolidation) as quoted on the Stock Exchange on the Last Trading Day;

(iii) a discount of approximately 20.63% to the average theoretical closing price of approximately HK$0.63 per Consolidated Share (after taking into account the effect of the Share Consolidation) as quoted on the Stock Exchange for the last five (5) consecutive trading days prior to the Last Trading Day;

(iv) a discount of approximately 22.12% to the average theoretical closing price of approximately HK$0.642 per Consolidated Share (after taking into account the effect of the Share Consolidation) as quoted on the Stock Exchange for the late ten (10) consecutive trading days up to and including the Last Trading Day;

(v) a discount of approximately 4.62% to the theoretical ex-rights price of approximately HK$0.5242 per Consolidated Share as adjusted for the effect of the Rights Issue, based on the theoretical closing price of HK$0.645 per Consolidated Share (after taking into account the effect of the Share Consolidation) as quoted on the Stock Exchange on the Last Trading Day;

(vi) a theoretical dilution effect (as defined under Rule 7.27B of the Listing Rules) represented by a discount of approximately 18.73%, which is calculated based on the theoretical diluted price of approximately HK$0.5242 per Consolidated Share to the benchmarked price of approximately HK$0.645 per Consolidated Share (as defined under Rule 7.27B of the Listing Rules, taking account the higher of (i) the closing price of the Shares as quoted on the Stock Exchange on the Last Trading Day and (ii) the average of the theoretical closing prices of the Consolidated Shares as quoted on the Stock Exchange for the five (5) previous consecutive trading days prior to the Last Trading Day); and

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(vii) a premium of approximately HK$2.82 over the audited net liability value per Consolidated Share of approximately HK$2.32 based on the latest audited consolidated net liabilities of the Group of approximately RMB111.35 million (equivalent to approximately HK$118.51 million) as at 31 December 2024 and the theoretical number of Consolidated Shares (after taking into account the effect of the Share Consolidation) in issue as at the Last Trading Day (i.e. 255,728,860 Shares / 5 = 51,145,772 Consolidated Shares).

As disclosed in the Letter from the Board, the Subscription Price was arrived at after arm's length negotiation with reference to, among other things, the prevailing market price of the Shares and the financial conditions of the Group.

Comparison with historical closing prices of the Shares

In order to assess the fairness and reasonableness of the Subscription Price, we have performed a review on the daily closing prices and trading volume of the Shares from 17 June 2024 up to and including the Last Trading Day (the "Review Period") (being a period of approximately 12 months prior to and including the Last Trading Day) and compared with the Subscription Price. We consider that the Review Period is adequate to illustrate the recent price movement of the Shares for conducting a reasonable comparison among the historical closing prices prior to the Announcement and such comparison is relevant for the assessment of the fairness and reasonableness of the Subscription Price, as the share price before the Announcement represent a fair market value of the Company the Shareholders expected, while that after the Announcement, the value may have taken into account the potential upside of the Rights Issue which may distort the analysis. The chart below illustrates the adjusted daily closing price per the Share versus the Subscription Price of HK$0.5 per Rights Share during the Review Period as we have adjusted the Share price for the Review Period to reflect the impact of the Share Consolidation (the "Theoretical Closing Price"):

Source: website of the Stock Exchange

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

As shown in the chart above, during the Review Period, the average closing price was approximately HK$0.219 per Share (or the Theoretical Closing Price of HK$1.096, the “Average Theoretical Closing Price”). The daily closing price ranged from HK$0.096 per Share (or the Theoretical Closing Price of HK$0.48, the “Lowest Theoretical Closing Price”) recorded from 7 May 2025 to 9 May 2025 to HK$0.48 per Share (or the Theoretical Closing Price of HK$2.40, the “Highest Theoretical Closing Price”) recorded on 25 June 2024. We note that Shares were mostly traded above the Subscription Price in the whole Review Period, except for the Lowest Closing Price period. The Subscription Price of HK$0.5 represents (i) a premium of approximately 4.17% to the Lowest Theoretical Closing Price; (ii) a discount of approximately 79.17% to the Highest Theoretical Closing Price; and (iii) a discount of approximately 54.37% to the Average Theoretical Closing Price. As discussed in the section headed “Comparison with recent rights issues transactions” below, we note that it is a common practice (9 out of 12 Comparables) to set the subscription price at a discount to the prevailing trading prices of the relevant shares in order to increase the attractiveness and encourage shareholders to participate in the right issues.

There was a downtrend from 25 June 2024. The closing price of the Shares slightly rose from approximately HK$0.425 on 17 June 2024 to the highest closing price of HK$0.48 per Share on 25 June 2024. After reaching the highest closing price, the closing price of the Shares then gradually decreased and hit the lowest closing price of HK$0.096 per Share from 7 May 2025 to 9 May 2025. The closing price rose slightly again to the closing price of HK$0.175 per Share on 27 May 2025 with small fluctuations till the closing price of HK$0.129 per Share on the Last Trading Day.

The reason for the substantial fall in Share price since 25 June 2024 (“Downtrend Period”) was unknown to us since:

(i) the management of the Company was not aware of any reason for such fall in Share price during the Downtrend Period; and

(ii) we have reviewed all the announcements disclosed during the Downtrend Period, and we were not aware of any information which led to abrupt decrease of the Share prices during the Downtrend Period.

In light of the low trading volume, the Shareholders may encounter challenges in selling their Shares promptly at a more favourable price. Furthermore, the Company may face difficulties raising equity funds from third parties without offering a substantial discount to the prevailing Share price. Given the low trading liquidity and the observed Downward Trend in the closing price of the Shares during the Review Period, we believe that the determination of the Subscription Price is deemed fair and reasonable, thereby encouraging the Qualifying Shareholders to participate in the Rights Issue and to engage in the future development of the Company.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Historical trading liquidity of the Shares

Month	Total volume of Shares traded Shares	Number of trading days days	Approximate average daily trading volume of the Shares Shares	Percentage of average daily trading volume to total number of issued shares as at the end of the month/period (Note 1)
2024
June (from 17 June 2024)	235,500	10	23,550	0.0092%
July	625,000	22	28,409	0.0111%
August	104,500	22	4,750	0.0019%
September	951,500	19	50,079	0.0196%
October	2,616,232	21	124,582	0.0487%
November	4,123,609	21	196,362	0.0768%
December	1,052,250	20	52,613	0.0206%
2025
January	54,500	19	2,868	0.0011%
February	3,233,250	20	161,663	0.0632%
March	8,307,750	21	395,607	0.1547%
April	4,979,250	19	262,066	0.1025%
May	6,042,750	20	302,138	0.1181%
June (up to Last Trading Day)	852,000	12	71,000	0.0278%
Maximum			395,607	0.1547%
Minimum			2,868	0.0011%
Average			128,899	0.0504%

Source: website of the Stock Exchange

Note:
1. Based on the number of total issued Shares as at each month end as disclosed in the monthly returns of the Company.

As shown in the table above, the average daily trading volume of the Shares in each month ranged from 2,868 Shares in January 2025 (from 17 June 2024) to 395,607 Shares in March 2025 (up to Last Trading Day) during the Review Period, representing 0.0011% to approximately 0.1547% of the total number of issued shares as at the end of the month/period, respectively. Given such relatively thin liquidity of the Shares during the Review

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Period, it would be difficult for the Shareholders to acquire a substantial block of the Shares in the open market without exerting a significant impact on the Share price. We consider that the prices, liquidity and general price trend of the Shares during the Review Period should have reflected market evaluation on the recent business performance of the Group.

In view of the above, we consider that it is fair and reasonable for the Company to determine the Subscription Price with reference to (i) the observed downtrend of the market price of the Shares prior to and including the Last Trading Day; (ii) the prevailing volatile market conditions under the uncertainty in local and global economy and the fund-raising size intended by the Company discussed in the earlier section headed "Reasons for and benefits of the Rights Issue and use of proceeds"; and (iii) low trading liquidity of the Shares during the Review Period.

Comparison with recent rights issue transactions

In order to assess the fairness and reasonableness of the Subscription Price, we exhaustively conducted a search of recent proposed rights issue exercises, announced by the companies listed on the Stock Exchange (excluding those terminated or lapsed or announced but not yet completed) within approximately 6 months prior to the Last Trading Day (the "Comparison Period") to understand the trend of the recent market practice. Based on our research, we have identified a total of 12 rights issue comparables (the "Comparables") during the Comparison Period.

We consider the Comparison Period of approximately 6 months is adequate and appropriate given that (i) such period would provide us with the recent and relevant information to demonstrate the prevailing market practice prior to the Announcement under the prevailing market conditions; and (ii) we are able to identify sufficient and reasonable samples size for selection of Comparables within the Comparison Period. We note that the terms of the rights issue announced by the Comparables may not be directly comparable to the terms of the Rights Issue announced by the Group due to the differences in business activities and performances. We consider that despite the terms of the Rights Issue depend on various factors, including (i) the dilution effect to shareholding; (ii) less than HK$500 million having considered the estimated size of gross proceeds from the Rights Issue; (iii) discounts to share price, etc., they are often influenced by the recent market trends for rights issue. Although the Comparables included rights issue on different basis of entitlement, and involved issuers which engaged in different business or with different financial performance and funding needs from the Company, we consider that the Comparables are suitable to serve as a general, true and fair view of the recent market trends for similar transactions conducted by other Hong Kong listed issuers for the purpose of an assessment on the Subscription Price, as (i) all of the Comparables and the Company are listed on the Stock Exchange; (ii) our analysis is mainly concerned with the comparison of subscription price to closing price, theoretical ex-rights price, the consolidated net asset value per share and theoretical dilution effect; (iii) the exclusion of rights issue transactions of A-Shares and H-Shares; (iv) the exclusion of rights issue transactions without extraordinary general meeting; (v) the Comparables were included without any artificial selection or filtering on our part thus

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

they represented a general, true and fair view of the recent market trends for rights issue; (vi) all of the Comparables had either been completed or remained in progress as at the Latest Practicable Date, and none had been terminated, we consider that the Comparables are fair and representative samples.

Based on the above, we are of the view that our comparable analysis based on the above criteria is meaningful for us to form our view regarding the fairness and reasonableness of the Subscription Price. To the best of our knowledge and as far as we are aware of, the Comparables represent an exhaustive list of all relevant companies fitting our search criterion mentioned above, and we consider that such Comparables can provide a reference on the recent rights issues given the sufficient number of transactions in such period resulting in a reasonable sample size.

It should be noted that all the subject companies constituting the Comparables may have different principal activities, market capitalisation, profitability and financial position as compared with those of the Company, and the circumstances leading to the subject companies to proceed with the rights issues may also be different from that of the Company.

Table A

Date of announcement	Stock code	Company name	Basis of entitlement	Maximum gross proceeds (approximately)	Premium/(Discount) of subscription price over the closing price per share on the respective last trading day (%)	Premium/(Discount) of the subscription price over the theoretical ex-rights price per share based on the closing price per share on the last trading day prior to announcement in relation to the respective rights issue (%) (Note 2)	Premium/(Discount) of the subscription price over the consolidated NAV per share (%) (Note 2, 4)	Theoretical dilution effect (%) (Note 2)	Excess application	Underwritten/ Non-underwritten	Placing commission (%) (Note 3)
10-Jun-25	804	Pinextone Capital Limited	3 for 2	HK$68.7 million	(40.71)	(22.14)	(75.64)	(24.93)	No	Non-underwritten	5.00
23-May-25	8516	Grand Talents Group Holdings Limited	5 for 2	HK$27.5 million	(33.80)	(12.34)	(38.15)	(23.57)	No	Non-underwritten	3.00
13-May-25	204	Capital Realm Financial Holdings Group Limited	3 for 1	HK$155.7 million	4.17	N/A	(66.20)	0.00	No	Non-underwritten	3.00
17-Apr-25	653	Boojour Holdings Limited	3 for 1	HK$107.45 million	(25.93)	(8.85)	(75.91)	(20.95)	Yes	Non-underwritten	2.00
14-Mar-25	8143	Good Fellow Healthcare Holdings Limited	1 for 1	HK$29.2 million	(12.28)	(7.41)	233.33	(10.94)	No	Non-underwritten	1.00 or HK$128,000
7-Mar-25	1715	Volcano Spring International Holdings Limited	3 for 1	HK$88.4 million	47.86	8.70	28.86	0.00	No	Non-underwritten	1.00
18-Feb-25	164	China Bank Technologies Holdings Limited	4 for 1	HK$282.55 million	6.67	1.27	N/A	0.20	Yes	Non-underwritten	1.00
14-Feb-25	1529	Yue International Holdings Group Limited	4 for 1	HK$69.4 million	(7.14)	(1.52)	(88.60)	(21.47)	No	Non-underwritten	1.00 or HK$100,000
7-Feb-25	8481	Stream Ideas Group Limited	2 for 1	HK$48.8 million	(15.80)	(5.56)	319.24	(11.58)	No	Non-underwritten	3.00
17-Jun-25	1718	Wan Kei Group Holdings Limited	1 for 1	HK$23.0 million	(29.82)	(17.53)	(75.00)	(17.64)	No	Non-underwritten	3.00
20-Dec-24	8456	Mansion International Holdings Limited	4 for 1	HK$38.7 million	(22.90)	(5.50)	98.63	(18.80)	No	Non-underwritten	1.50
19-Dec-24	1850	HSC Resources Group Limited	4 for 1	HK$71.27 million	(24.29)	N/A	(93.70)	(19.43)	No	Non-underwritten	1.50
		Minimum			(40.71)	(22.14)	(93.70)	(24.93)			1.00
		Maximum			47.86	8.70	319.24	0.20			5.00
		Average			(12.76)	(7.81)	12.60	(14.89)			2.17
		Median			(18.95)	(6.49)	(75.00)	(18.22)			1.75
		The Company	5 for 1	HK$127.86 million	(22.48)	(4.62)	(21.55)	(18.73)	No	Non-underwritten	0.50

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Notes:

In order to calculate the average, minimum and maximum percentage of the placing commission of the Comparables, we have excluded the minimum placing commissions and absolute placing commissions.
“N/A” denotes that the announcement did not disclose such information.
The theoretical dilution effect is calculated in accordance with Rule 7.27B of the Listing Rules or Rule 10.44A of the Rules Governing the Listing of Securities on GEM of the Stock Exchange.
The comparison to net asset value is not applicable due to the Company was at net liabilities position according to its 2024 Annual Report.
N/A represents the respective fundraising exercise did not involve underwriters nor placing agents.

Based on the Table A, we noted that:

(i) the subscription prices to the closing price on the last trading days prior to the announcements of the Comparables ranged from a discount of approximately 40.71% to a premium of approximately 47.06% (the “Comparable LTD Range”), with an average and median of discounts of approximately 12.76% and 18.95% respectively. The discount of approximately 22.48% of the Company’s Subscription Price of HK$0.5 per Rights Share to the closing price of HK$0.645 per Consolidation Share on the Last Trading Day, which is within the Comparable LTD Range, larger than the average and the median discount of Comparable LTD Range;

(ii) the theoretical ex-rights price per share based on the closing price per share on the last trading day prior to the announcements of the Comparables in relation to the respective ranged from a discount of approximately 22.14% to a premium of approximately 8.70% (the “Comparable TERP Range”), with an average and median of discounts of approximately 7.01% and 6.49% respectively. The discount of the Subscription Price to the theoretical ex-rights price of HK$0.5242 per Consolidation Share on the Last Trading Day of approximately 4.62% is within the Comparable TERP Range and with a lower discount than the average of Comparable TERP Range and the median of Comparable TERP Range; and

(iii) the theoretical dilution effect of the Comparables ranged from a discount of approximately 24.93% to a premium of approximately 0.20% (the “Comparable Dilution Range”), with an average and median dilution effects of approximately 14.09% and 18.22%, respectively. The theoretical dilution effect of the Rights Issue of approximately 18.73% to the existing Shareholders if they elect not to participate in the Rights Issue is within the Comparable Dilution Range, slightly higher than the average and median dilution effects of the Comparables. As the theoretical dilution effect of the Rights Issue is below 25%, it is in compliance with Rule 7.27B of the Listing Rules. Although the theoretical dilution effect of approximately 18.73% representing a relatively

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

high dilution as comparing with the average and median dilution effects, the Rights Issue is achieving the necessary fund raising requirements while setting the Subscription Price that encourages Shareholders to participate. The Rights Issue demonstrates the capacity of the Group in raising new capital, strengthen its financial position and enhancing its financial performance by reducing debt levels and financing costs. Considering that (a) the theoretical dilution effect represented at the discount of approximately 18.73% by the Rights Issue; (b) the net proceeds from the Rights Issue would improve the Group's financial condition; and (c) the Subscription Price favors the Qualifying Shareholders to subscribe for the Rights Shares and maintain their respective pro-rata shareholding interests in the Company, we consider that although the theoretical dilution effect is slightly higher than the average and median of dilution effect, it is within the Comparable Dilution Range which represented by the Rights Issue is acceptable so far as Independent Shareholders are concerned.

Taking into consideration that, (i) the Subscription Price of the Rights Issue has a discount of 54.37% to the Average Theoretical Closing Price during the Review Period; (ii) the trading liquidity of the Shares were very thin during the Review Period and the Subscription Price at a discount to the Average Theoretical Closing Price may enhance the attractiveness of the Shares among the thin trading liquidity; (iii) a review period of 6 months prior to the Announcement to be exhaustive for a representation of proposed rights issue in the recent market; and (iv) the Independent Shareholders may subscribe the Rights Share with the Subscription Price close to the price of HK$0.795 per Consolidated Share on the Latest Practicable Date under the thin trading liquidity, we are of the view that the setting of the Subscription Price is fair and reasonable so far as the Independent Shareholders are concerned and the Independent Shareholders are advised to subscribe for the entitlements.

Absence of excess application arrangement

As mentioned in the Letter from the Board, Qualifying Shareholders will not be entitled to subscribe for any Rights Shares in excess of their respective entitlements. Based on our analysis on the Comparables, we noted that 10 out of 12 Comparables, did not offer excess application as part of the rights issue. On this basis, we considered the absence of excess application to be not uncommon market practice. Furthermore, the Rights Issue will give the Qualifying Shareholders an equal and fair opportunity to maintain their respective pro rata shareholding interests in the Company, for Qualifying Shareholders who accept their respective entitlements under the Rights Issue in full, they would be able to maintain their respective existing shareholdings in the Company after completion of the Rights Issue. As such, we considered that the absence of excess application arrangement is acceptable so far as the Independent Shareholders are concerned.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Placing commission

As set out in the Letter from the Board, the terms of the Placing Agreement, including the rate of placing commission, were determined after arm's length negotiation between the Company and the Placing Agent with reference to the market comparables, the existing financial position of the Group, the size of the Rights Issue, and the current and expected market condition. For further details of the principal terms of the Placing Agreement, please refer to section headed "The Placing Agreement" in the Letter from the Board. The Placing Agent to the Company will receive a 0.5% of the amount, which is equal to the placing price multiplied by the number of Placing Shares that have been successfully placed by the Placing Agent and/or its sub-placing agent(s) pursuant to the terms of the Placing Agreement. According to the Comparables as set out in Table A, the placing commission of the Comparables ranged from 1.00% to 5.00%, with the average and median of 2.17% and 1.75%, respectively. As the placing commission is out of the range of the Comparables, we consider that although the placing commission of 0.5% borne by the Company in the Rights Issue is slightly below the market practice range, considering the placing commission is lower than the market practice means it leads to a higher net proceeds for the Company. Based on the above, we are of the view that the placing commission is in the interests of the Company and Independent Shareholders as a whole.

4. Dilution effect of the Rights Issue on the shareholding of the Company

All the Qualifying Shareholders are entitled to subscribe for the Rights Shares. For those Qualifying Shareholders who take up their full provisional allotments under the Rights Issue, their shareholding interests in the Company will remain unchanged after the Rights Issue. Referring to the section headed "6. EFFECT OF THE SHAREHOLDING STRUCTURE OF THE COMPANY" in the Letter from the Board, all Qualifying Shareholders are entitled to subscribe for the Rights Shares. Qualifying Shareholders who do not accept the Rights Issue are able to sell their nil-paid rights to subscribe for the Rights Shares in the market. Where all Qualifying Shareholders do not accept the Rights Issue and thus the Placing Agents subscribe for the Unsubscribed Rights Shares pursuant to the Placing Agreement, the maximum dilution effect on the Qualifying Shareholders' shareholding interests will be 16.67% (after taking into account the effect of the Share Consolidation). It should be noted that the actual changes in the shareholding structure of the Company upon completion of the Rights Issue are subject to various factors, including but not limited to the results of acceptance of the Rights Issue.

In all cases of rights issue, the dilution on the shareholding of those qualifying shareholders who do not take up in full their provisional allotments under the rights issue is inevitable. In fact, the dilution magnitude of any rights issue depends mainly on the extent of the basis of entitlement under such exercise since the higher offering ratio of new shares to existing shares is, the greater the dilution on the shareholding would be.

Having considered that (i) the dilution effect is not prejudicial as all Qualifying Shareholders are offered an equal opportunity to participate in the Rights Issue and public Shareholders' interests in the Company will be not diluted if they elect to exercise their

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

full provisional allotments under the Rights Issue; (ii) shareholding dilution is inherent in rights issue in general; (iii) the imminent need of financial resources for the Company; and (iv) the positive impact on the financial position of the Group as a result of the Rights Issue as detailed in paragraph headed "Possible Financial Effect of the Rights Issue" below, we are of the view that the potential dilution effect on the shareholding, which may only happen to the Qualifying Shareholders who decide not to subscribe for their pro-rata Rights Shares, is justifiable.

5. Possible Financial Effect of the Rights Issue

Net tangible assets value

According to the "Unaudited pro forma financial information of the Group" set out in Appendix II to the Circular, based on (i) the audited consolidated negative net tangible assets value of the Group attributable to the equity holder of the Company of approximately RMB111.34 million; and (ii) the 255,728,860 Rights Shares in issue as at the Last Practicable Date (representing 51,145,772 Consolidated Shares as at Latest Practicable Date and the effective date of the Share Consolidation), the audited consolidated negative net tangible assets value per Share attributable to the Shareholders amounted to approximately RMB4.39 per Consolidated Share.

On the assumptions that completion of the Rights Issues had taken place on 31 December 2024, the Share Consolidation had become effective and 255,728,860 Rights Shares had been issued, immediately upon Completion of the Rights Issue, (i) the unaudited pro forma adjusted consolidated negative net tangible assets of the Group attributable to the equity holders of the Company would become approximately RMB108.0 million; and (ii) the number of Shares in issue would become 51,145,772 Consolidated Shares, resulting in the unaudited pro forma adjusted consolidated negative net tangible assets value per Consolidated Share attributable to the Shareholders of approximately RMB0.35.

Despite a reduction of approximately $92.0\%$ in the consolidated negative net tangible assets value per share upon Completion, we have carefully considered (i) the reasons for the Rights Issue as outlined in the section titled "2. Reasons for and benefits of the Rights Issue and use of proceeds" in this letter, and (ii) the rights of the Qualifying Shareholders to take up their respective entitlements. This allows them to maintain their shareholdings in the Company and participate in the Group's potential growth. In our view, the overall impact on the consolidated negative net tangible assets value per share is fair and reasonable, and it serves the best interests of the Company and its Shareholders as a whole.

Liquidity

According to the 2024 Annual Report, as at 31 December 2024, the bank and cash equivalents of the Group was approximately RMB15.18 million and the Group had current assets of approximately RMB108.13 million, current liabilities of approximately RMB289.13 million. Accordingly, the current ratio of the Group (being the current assets of the Group divided by the current liabilities of the Group)

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

as at 31 December 2024 was approximately 0.37 times. Immediately upon completion of the Rights Issue, the bank and cash equivalents of the Group is expected to increase by the expected net proceeds from the Rights Issue of approximately HK$125.73 million. The current ratio of the Group will be increased from approximately 0.37 times to approximately 0.81 times. As such, the current ratio and the liquidity of the Group will be improved upon the completion of the Rights Issue.

After taking into consideration of the above, particularly, the improvement in liquidity position of the Group, we are of the view that the Rights Issue is in the interest of the Company and the Shareholders as a whole.

Shareholders should note that the aforesaid analyses are for illustrative purpose only and do not purport to represent the financial position of the Group upon completion of the Rights Issue and because of its hypothetical nature, does not provide any assurance or indication that any event will take place in the future and may not be indicative of (i) the financial position of the Company as at 31 December 2024 or any future date; or (ii) the net assets/liabilities per Share of the Company as at 31 December 2024 or any future date.

OPINION AND RECOMMENDATION

Having taken into consideration of the following principal factors and reasons regarding the major terms of the Rights Issue including:

(i) the proceeds from the Rights Issue for repayments of the Group’s loans and other payables, and the Directors expectation to strengthen its general working capital structure without incurring debt financing cost and improve the financial position, under section headed “2. Reasons for and benefits of the Rights Issue and use of proceeds” above in this letter;

(ii) taking into account the benefits and cost of each of the alternatives, the Rights Issue represents a more cost effective, efficient and beneficial mean to the Company and the Shareholders as a whole as compared to raising fund by other means as stated under the paragraph headed “Alternative financing methods” above in this letter;

(iii) the Subscription Price represents a discount of approximately 22.48% and 20.63% to the theoretical closing price on the Last Trading Day, and the five (5) consecutive trading days prior to the Last Trading Day, respectively;

(iv) the Subscription Price is fair and reasonable in our view for the reasons set out in earlier sections headed “Subscription Price” and “Comparison with recent rights issue transactions” in this letter; and

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(v) Rights Issue is conducted on the basis that all Qualifying Shareholders have been offered the same opportunity to maintain their proportionate interests in the Company and allows the Qualifying Shareholders to participate in the future growth of the Company, and the maximum dilution effect only occur when the Qualifying Shareholders do not subscribe for their proportionate Rights Shares,

we are of the view that the terms of the Rights Issue are on normal commercial terms and are fair and reasonable so far as the Independent Shareholders are concerned and the Rights Issue including the transactions contemplated thereunder are in the interests of the Company and the Shareholders as a whole. Accordingly, we recommend the Independent Shareholders and the Independent Board Committee to advise the Independent Shareholders to vote in favour of the resolution to be proposed at the EGM to approve the Rights Issue.

Yours faithfully

For and on behalf of

Silverbricks Securities Company Limited

Yau Tung Shing

Managing Director of Corporate Finance

Note: Mr. Yau Tung Shing is a licensed individual under the SFO, authorized to conduct Type 6 (advising on corporate finance) regulated activities in accordance with the SFO. He is considered responsible officer of Silverbricks Securities Company Limited. Mr. Yau Tung Shing possesses over 9 years of experience in the corporate finance industry.

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APPENDIX I

FINANCIAL INFORMATION OF THE GROUP

A. FINANCIAL INFORMATION OF THE GROUP

The financial information of the Group for the three years ended 31 December 2022, 2023 and 2024 are disclosed in the following documents which have been published on the websites of the Stock Exchange (www.hkex.com.hk) and the Company (http://www.risecomm.com.cn), respectively:

(i) annual report of the Company for the year ended 31 December 2022 (pages 76 to 165) (https://www1.hkexnews.hk/listedco/listconews/sehk/2023/0427/2023042700671.pdf)

(ii) annual report of the Company for the year ended 31 December 2023 (pages 81 to 169) (https://www1.hkexnews.hk/listedco/listconews/sehk/2024/0425/2024042502072.pdf)

(iii) annual report of the Company for the year ended 31 December 2024 (pages 84 to 169) (https://www1.hkexnews.hk/listedco/listconews/sehk/2025/0425/2025042501515.pdf)

B. STATEMENT OF INDEBTEDNESS

As at the close of business on 31 May 2025, being the latest practicable date for the purpose of ascertaining information contained in this indebtedness statement prior to the printing of this Circular, the indebtedness of the Group was as follows:

Bank and other borrowings

| | RMB'000
(unaudited) |
| --- | --- |
| Bank borrowings — unsecured and guaranteed (note (a)) | 3,100 |
| Bank borrowings — unsecured and unguaranteed | 6,000 |
| Other borrowings — secured and unguaranteed (note (b)) | 140,157 |
| Other borrowings — unsecured and guaranteed (note (c)) | 3,000 |
| Other borrowings — unsecured and unguaranteed (note (d)) | 97,352 |
| | 249,609 |

Notes:

(a) The amounts were guaranteed by Zhang Zipeng, a director of an indirect wholly owned subsidiary of the Company.

(b) The other borrowing amounted to approximately RMB109,927,000 was secured by the entire equity interest of Risecomm Co. Ltd. and Risecomm (HK) Technology Company Limited, indirect wholly owned subsidiaries of the Company. The other borrowing amounted to approximately RMB30,230,000 was a loan provided by Fu Xiaoqin, a substantial shareholder of the Company, of which was secured by 30% equity interest of Zhongyi (BVI) International Limited, an indirect wholly owned subsidiary of the Company.

(c) The other borrowing amounted to approximately RMB3,000,000 was a loan provided by Zhongjia Xinda Investment Co., Ltd., an entity that is controlled by Ding Zhigang, a non-executive director and a substantial shareholder of the Company. The loan was guaranteed by Zhang Zipeng and Tang Andong, directors of indirectly wholly owned subsidiaries of the Company.

APPENDIX I

FINANCIAL INFORMATION OF THE GROUP

(d) The other borrowing amounted to approximately RMB11,586,000 was a loan provided by Ning Jun, a substantial shareholder of the Company. The other borrowing amounted to approximately RMB916,000 was a loan provided by Ding Zhigang, a non-executive director and a substantial shareholder of the Company. The other borrowings amounted to approximately RMB62,954,000 were loans provided by Guo Lei, a non-executive director of the Company.

Contingent liabilities and litigation

As at 31 May 2025, there is no material change for the commitments and contingencies that disclosed in note 43 to the consolidated financial statements set out in the Company's annual report for the year ended 31 December 2024 (the "2024 Annual Report").

Save as disclosed above and apart from intra-group liabilities and normal accounts payable in the ordinary course of business of the Group, the Group did not have any outstanding indebtedness in respect of any mortgages, charges or debentures, loan capital, bank loans and overdrafts, loans, debt securities or other similar indebtedness, liabilities under acceptance (other than normal trade bills) or acceptance credits or hire purchase commitments, guarantees or other material contingent liabilities as at the close of business on 31 May 2025.

C. SUFFICIENCY OF WORKING CAPITAL

As at 31 May 2025, the Group had net current liabilities and net liabilities of approximately RMB172,645,000 and RMB113,139,000, respectively. The Group had total liabilities of approximately RMB323,087,000, including trade and other payables, bank borrowings and other borrowings, while the Group had cash and cash equivalent of approximately RMB11,246,000 as of the same date.

The directors would like to draw attention to the fact that the sufficiency of working capital of the Group in the next twelve months from the date of this Circular would depend upon the following:

(i) whether the Group can successfully renew the bank and other borrowings with various lenders. As at the date of this Circular, the Group has obtained financial support from various lenders of other borrowings, which are related parties of the Group, of which sufficient financial resources will be available to the Group to enable it to meet its liabilities as and when they fall due. In addition, the Group has entered into contractual arrangements with certain lenders to extend the maturity of existing financing arrangements, including other borrowings of approximately RMB109,927,000 which would not be repayable within the next twelve months; and

(ii) whether the Rights Issue can be successfully proceeded.

The Directors have reviewed the Group's cash flow projections which cover a period not less than twelve months from the date of this Circular. The Directors, after due and careful enquiry and after taking into account the above plans and measures, the financial resources available to the Group, including cash flows generated from future operations, the existing

APPENDIX I

FINANCIAL INFORMATION OF THE GROUP

cash and cash equivalent of the Group, are of the opinion that the Group will has sufficient working capital for its normal business operation for at least the next twelve months from the date of this Circular, in the absence of unforeseeable circumstances.

According to the 2024 Annual Report, the auditor's report on the Group's consolidated financial statements for the year ended 31 December 2024 has included an emphasis of matter paragraph related to its going concern.

D. MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, the Directors were not aware of any material adverse change in the financial or trading position of the Company since 31 December 2024, being the date to which the latest published audited consolidated financial statements of the Company were made up.

E. FINANCIAL AND TRADING PROSPECTS OF THE GROUP

As reform of electric power system takes place, along with the construction of a new electric power system basing on new energy, it becomes necessary to increase investment in the entire chain of electric energy from electricity production to transmission and consumption. From power grid side, to ensure reliable power supply and safe operation, it is necessary to significantly improve the power system's peak shaving, frequency regulation and voltage regulation capabilities, and to configure relevant technical equipment. Against the background of the dual-carbon policy and the construction of a new electric power system basing on new energy, the development of the power Internet of Things is expected to accelerate. With the emergence of a large number of distributed wind and solar power generators, electric vehicle charging piles, energy storage equipment and other two-way loads, the local quantitative IoT operating environment is becoming increasingly complex. As network scale increases and requirement for realtime transmission increases, there also puts forward a higher requirement on equipment communication speed, delay and reliability. In order to meet the needs of new power systems, State Grid has been accelerating the formulation of new technology standards. The new generation of smart meters will continue to be promoted, the older generation will continue to be updated, and the construction of new power systems will lead to the replacement of more energy meters. The number of smart meter tenders is expected to maintain a steady growth momentum in the future, which will in turn drive the growth in demand for PLC modules.

With the further advancement of carbon peaking and carbon neutrality strategies, the development of renewable energy such as photovoltaic and wind power will accelerate. Energy transformation requires the reshaping of the power grid, and the distribution network also needs to be transformed and upgraded.

Distribution network will become a key part of power grid construction in the "14th Five-Year Plan". State Grid issued the "Action Plan for Building a New Power System with New Energy as the Main Body (2021-2030)" *(構建以新能源為主體的新型電力系統行動方案(2021-2030年)) and proposed investment in distribution network construction will exceed RMB1.2 trillion, accounting for more than 60% of the total investment in power grid construction. China Southern Power Grid issued the "14th Five-Year Plan" power grid

I-3 -

APPENDIX I

FINANCIAL INFORMATION OF THE GROUP

development plan, proposing a planned investment of approximately RMB670 billion yuan in power grid construction to accelerate the construction of digital power grids and the modernization of the power grid. Among them, the planned investment in distribution network construction reached RMB320 billion, accounting for 48% of the total. Historically, the investments of State Grid and China Southern Power Grid have mainly been concentrated in power transmission and transformation. The proportion of investment on the distribution network is expected to increase significantly in the future.

In 2025, State Grid and China Southern Power Grid will still be committed to the application of broadband dual-mode technology in power information collection systems and terminal products such as low-voltage distribution networks and measurement switches. The Group is promoting its broadband dual-mode products (including chips and modules) to more network provincial markets to further expand the competitiveness of the Group's broadband dual-mode products in the domestic market. The Group will focus on the broadband dual-mode communication market, keeping its technologies updated, and actively participating in the development and marketing of broadband dual-mode products by State Grid, China Southern Power Grid and other provincial network companies. At the same time, founding on the research and development of its broadband or broadband dual-mode communication technology, the Group is actively promoting itself in more application markets including power grid low-voltage distribution network, measurement switch, and power Internet of Things market.

The application of the Group's broadband and broadband dual-mode communication chips and communication modules will be set around smart power distribution, smart power consumption, smart microgrids and comprehensive power application requirement, and will also cover collection and application of power consumption information, photovoltaic or energy storage, industrial enterprises and parks and other energy management fields. The Group adopts broadband or broadband dual-mode integrated communication solutions, combined with edge computing technology, to develop a series of intelligent products adapted to the energy internet, and provides a variety of intelligent energy internet solutions for integrated energy and smart grids.

In addition, the Group is expanding its market in smart city lighting, smart air conditioning and integrated energy management systems and terminal products. With the national government's promotion of smart grid and smart city construction, support for energy conservation and emission reduction, promotion of new energy, and the expanding overseas smart meter market under the development of the "Belt and Road Initiative", the market for PLC technology is expected to maintain a good development trend in the next few years, which is expected to promote the sales of various products of the Group, especially in the field of maintenance and safety integrity systems in the petroleum and petrochemical industries which continue to expand its market scope, bringing more opportunities to the Group.

For the Group's smart manufacturing & industrial automation business, the Group believes that the growth of China industrial automation market would continue to be healthy given its current relatively low penetration rate and the rising cost of labour. As petrochemical enterprises are the pioneers of the manufacturing sector in China, major market participants have started to build smart oil fields, smart pipelines and smart factories.

APPENDIX I

FINANCIAL INFORMATION OF THE GROUP

The Group will continue to capture opportunities in the design and implementation of industrial automation systems, particularly in the area of maintenance and safety integrity system for the petroleum and petrochemicals industry, other manufacturing and construction businesses by leveraging the Group's own technologies and intellectual property rights.

For the Group's wind farm operation and maintenance business, the domestic wind power industry has been developing on a large scale for nearly a decade. With the passage of time, wind turbines wear out, and the maintenance of wind turbines has become the key to ensuring the proper functioning of wind farms. The industry believes that with the gradual reduction of high-quality wind power resource areas and new installed capacity in PRC, wind farm operation and maintenance services will provide huge potential for wind power equipment manufacturers to expand their business in the fiercely competitive new installed capacity market. The key points are as follows:

Wind turbines are out of warranty, and demand for operation and maintenance services market is released

Over the past fifteen years, PRC has gradually formed the world's largest wind power market. The rapid growth of wind power installed capacity has led to a significant increase in equipment maintenance. Domestic wind turbines had a two-year warranty before 2010 and a three-to-five year warranty thereafter. During the period from 2006 to 2010, with the rapid development of the domestic wind power industry, a large number of wind turbines were put into operation. Most of the wind turbines of this period are now in post-warranty stage. With the end of the warranty period, a huge wind farm operation and maintenance services market is gradually emerging. According to a research report by Bloomberg New Energy Finance on PRC's wind farm operation and maintenance services market, the total expenditure of wind farm operation and maintenance services in PRC reached US$16 billion during the period between 2015 and 2022.

The market potential has been greatly increased due to replacement of old turbines

As high-quality wind resources are becoming increasingly scarce, in order to efficiently utilize those territories with high-quality wind resources, it will become inevitable to replace old wind turbines with new ones. In addition, as the service life of those wind turbines approaches their 20-year limit, there will be a large number of retired wind turbines in PRC. This means that there are new growth points in the highly competitive market for new installed capacity.

The warranty period of the Group's operation and maintenance contracts will expire in 2026-2029. The management team is also vigorously expanding new wind farm operation and maintenance services projects, including but not limited to business such maintenance services, trade in business, and other businesses.

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

The following is the text of a report received from the Company's reporting accountants, Rongcheng (Hong Kong) CPA Limited, Certified Public Accountants, Hong Kong, prepared for the purpose of inclusion in this Circular.

For illustrative purpose only, set out below is the unaudited pro forma statement of adjusted consolidated net tangible assets of the Group after completion of the Rights Issue. Although reasonable care has been exercised in preparing the unaudited pro forma financial information, Shareholders who read the information should bear in mind that these figures are inherently subject to adjustments and may not give a complete picture of the Group's financial results and positions for the financial periods concerned.

A. UNAUDITED PRO FORMA STATEMENT OF ADJUSTED CONSOLIDATED NET TANGIBLE ASSETS OF THE GROUP

The unaudited pro forma statement of adjusted consolidated net tangible assets of the Group attributable to the owners of the Company (the "Unaudited Pro Forma Financial Information") has been prepared by the Directors in accordance with paragraph 4.29 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong limited (the "Listing Rules") to illustrate the effect of the Rights Issue on the consolidated net tangible assets of the Group as if the Rights Issue had taken place on 31 December 2024.

The Unaudited Pro Forma Financial Information is prepared for illustrative purposes only and based on the judgements, estimates and assumptions of the Directors, and because of its hypothetical nature, it may not give a true picture of the consolidated net tangible assets of the Group attributable to the owners of the Company immediately after completion of the Rights Issue or any future date after completion of the Rights Issue.

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

The Unaudited Pro Forma Financial Information is prepared based on the consolidated negative net tangible assets of the Group attributable to owners of the Company as at 31 December 2024, as extracted from the published annual report for the year ended 31 December 2024 of the Company and is adjusted to reflect the effect of the Rights Issue as if the Rights Issue had been completed on 31 December 2024.

	Audited consolidated negative net tangible assets of the Group attributable to owners of the Company as at 31 December 2024 RMB'000 (Note 1)	Estimated net proceeds from the Rights Issue RMB'000 (Note 2)	Unaudited pro forma adjusted consolidated negative net tangible assets of the Group attributable to owners of the Company immediately after completion of the Rights Issue RMB'000	Audited consolidated negative net tangible assets of the Group attributable to owners of the Company per share 31 December 2024 RMB (Note 3)	Unaudited pro forma adjusted consolidated negative net tangible assets of the Group attributable to owners of the Company per share immediately after completion of the Rights Issue RMB (Note 4)
Based on 255,728,860 Rights Shares to be issued at Subscription Price of HK$0.5 per Rights Share	(224,385)	116,426	(107,959)	(4.39)	(0.35)

Notes:

The amount of consolidated negative net tangible assets of the Group attributable to owners of the Company as at 31 December 2024 is extracted from the published consolidated financial statements for the year ended 31 December 2024 of the Company, which is equal to the consolidated negative net assets attributable to owners as at 31 December 2024 of RMB111,346,000, after deducting intangible assets of approximately RMB113,039,000.
The estimated net proceeds from the Rights Issue of approximately HK$125,730,000 (equivalent to approximately RMB116,426,000) is calculated based on 255,728,860 Rights Shares assuming to be issued on the completion of the Rights Issue at the Subscription Price of HK$0.5 per Rights Share and after deduction of estimated related expenses of approximately HK$2.13 million (equivalent to approximately RMB1.97 million).
The consolidated negative net tangible assets of the Group attributable to owners of the Company per share as at 31 December 2024 was calculated based on the consolidated negative net tangible assets of the Group attributable to owners of the Company as at 31 December 2024, divided by 51,145,772 Consolidated Shares.
The unaudited pro forma adjusted consolidated negative net tangible assets of the Group attributable to owners of the Company per share as at 31 December 2024 immediately after completion of the Rights Issue is calculated based on the unaudited pro forma adjusted consolidated negative net tangible assets of the Group attributable to owners of the Company immediately after completion of Rights Issue, divided by 306,874,632 Shares which represents 51,145,772 Consolidated Shares and 255,728,860 Rights Shares, assuming the Rights Issue has been completed on 31 December 2024.

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

For the purpose of the unaudited pro forma adjusted consolidated negative net tangible assets of the Group attributable to owners of the Company, the balances stated in HK$ are translated into RMB at the approximately exchange rate of HK$1 to RMB0.926 which was the prevailing exchange rate as at 31 December 2024 for illustration purpose only, and such translation does not constitute a representation that any amount has been, could have been, or may otherwise be exchanged or converted at the above rate.
Save as disclosed above, no adjustment has been made to reflect any trading results or other transactions of the Group entered into subsequent to 31 December 2024.
II-3 -

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

The following is the text of the independent reporting accountants' assurance report received from Rongcheng (Hong Kong) CPA Limited, Certified Public Accountants, Hong Kong, the reporting accountants of the Company, in respect of the Group's unaudited pro forma financial information prepared for the purpose of incorporation in this Circular.

B. INDEPENDENT REPORTING ACCOUNTANTS' ASSURANCE REPORT ON THE COMPILATION OF THE UNAUDITED PRO FORMA FINANCIAL INFORMATION

容诚|RCHK

Rongcheng (Hong Kong) CPA Limited
3203A-05, 32/F, Tower 2, Lippo Centre,
89 Queensway, Admiralty, Hong Kong
TEL: (852) 2564 9788

To the Directors of Risecomm Group Holdings Limited

Dear Sirs,

We have completed our assurance engagement to report on the compilation of the unaudited pro forma financial information of Risecomm Group Holdings Limited (the "Company") and its subsidiaries (hereinafter collectively referred to as the "Group") by the directors of the Company (the "Directors") for illustrative purposes only. The unaudited pro forma financial information consists of the unaudited pro forma statement of adjusted consolidated net tangible assets of the Group as at 31 December 2024 and related notes as set out in Appendix II to the circular issued by the Company dated 23 July 2025 (the "Circular"). The applicable criteria on the basis of which the Directors have compiled the unaudited pro forma financial information are described in Appendix II to the Circular.

The unaudited pro forma financial information has been compiled by the Directors to illustrate the impact of the proposed Rights Issue on the Group's financial position as at 31 December 2024 as if the Rights Issue had taken place at 31 December 2024. As part of this process, information about the Group's financial position has been extracted by the Directors from the Group's financial information for the year ended 31 December 2024m on which an annual report has been published.

Directors' Responsibilities for the Unaudited Pro Forma Financial Information

The Directors are responsible for compiling the unaudited pro forma financial information in accordance with paragraph 4.29 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Listing Rules") and with reference to Accounting Guideline 7 "Preparation of Pro Forma Financial Information for Inclusion in Investment Circulars" ("AG 7") issued by the Hong Kong Institute of Certified Public Accountants ("HKICPA").

II-4 -

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

Our Independence and Quality Management

We have complied with the independence and other ethical requirements of the “Code of Ethics for Professional Accountants” issued by the HKICPA, which is founded on fundamental principles of integrity, objectivity, professional competence and due care, confidentiality and professional behavior.

Our firm applies Hong Kong Standard on Quality Management (HKSQM) 1 “Quality Management for Firms that Perform Audits or Reviews of Financial Statements, or Other Assurance or Related Services Engagements” issued by the HKICPA, which requires the firm to design, implement and operate a system of quality management including policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements.

Reporting Accountants’ Responsibilities

Our responsibility is to express an opinion, as required by paragraph 4.29(7) of the Listing Rules, on the unaudited pro forma financial information and to report our opinion to you. We do not accept any responsibility for any reports previously given by us on any financial information used in the compilation of the unaudited pro forma financial information beyond that owed to those to whom those reports were addressed by us at the dates of their issue.

We conducted our engagement in accordance with Hong Kong Standard on Assurance Engagements 3420 “Assurance Engagements to Report on the Compilation of Pro Forma Financial Information Included in a Prospectus” issued by the HKICPA. This standard requires that the reporting accountants comply with ethical requirements and plan and perform procedures to obtain reasonable assurance about whether the Directors have compiled the unaudited pro forma financial information in accordance with paragraph 4.29 of the Listing Rules and with reference to AG 7 issued by the HKICPA.

For purposes of this engagement, we are not responsible for updating or reissuing any reports or opinions on any historical financial information used in compiling the unaudited pro forma financial information, nor have we, in the course of this engagement, performed an audit or review of the financial information used in compiling the unaudited pro forma financial information.

The purpose of the unaudited pro forma financial information included in an investment circular is solely to illustrate the impact of a significant event or transaction on unadjusted financial information of the Group as if the event had occurred or the transaction had been undertaken at an earlier date selected for purposes of the illustration. Accordingly, we do not provide any assurance that the actual outcome of the event or transaction at 31 December 2024 would have been as presented.

A reasonable assurance engagement to report on whether the unaudited pro forma financial information has been properly compiled on the basis of the applicable criteria involves performing procedures to assess whether the applicable criteria used by the Directors

II-5 -

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

in the compilation of the unaudited pro forma financial information provide a reasonable basis for presenting the significant effects directly attributable to the event or transaction, and to obtain sufficient appropriate evidence about whether:

The related pro forma adjustments give appropriate effect to those criteria; and
The unaudited pro forma financial information reflects the proper application of those adjustments to the unadjusted financial information.

The procedures selected depend on the reporting accountants' judgment, having regard to the reporting accountants' understanding of the nature of the Group, the event or transaction in respect of which the unaudited pro forma financial information has been compiled, and other relevant engagement circumstances.

The engagement also involves evaluating the overall presentation of the unaudited pro forma financial information.

We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Opinion

In our opinion:

(a) the unaudited pro forma financial information has been properly compiled on the basis stated;
(b) such basis is consistent with the accounting policies of the Group; and
(c) the adjustments are appropriate for the purposes of the unaudited pro forma financial information as disclosed pursuant to paragraph 4.29(1) of the Listing Rules.

Yours faithfully,

Rongcheng (Hong Kong) CPA Limited
Certified Public Accountants
Fong Ho Keung
Practising Certificate Number: P08079
Hong Kong
23 July 2025

APPENDIX III

GENERAL INFORMATION

1. RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that, to the best of their knowledge and belief, the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.

2. SHARE CAPITAL

The authorised and issued share capital of the Company (a) as at the Latest Practicable Date; (b) immediately following the completion of the Increase in Authorised Share Capital and the Share Consolidation becoming effective but before the completion of the Rights Issue; and (c) immediately following the completion of the Rights Issue (assuming there is no change in the issued share capital of the Company from the Latest Practicable Date up to and including the Record Date other than as a result of the Increase in Authorised Share Capital and the Share Consolidation) will be, as follows:

(a) As at the Latest Practicable Date

Authorised:	1,000,000,000	Shares of HK$0.001 each	HK$ 1,000,000
Issued and fully paid:	255,728,860	Shares of HK$0.001 each	255,728.86

(b) Immediately following the Increase in Authorised Share Capital and the Share Consolidation becoming effective but before the completion of the Rights issue

Authorised:	1,000,000,000	Shares of HK$0.001 each	HK$ 1,000,000
Issued and fully paid:	51,145,772	Shares of HK$0.001 each	51,145.77

APPENDIX III

GENERAL INFORMATION

(c) Immediately following the Increase in Authorised Share Capital and the Share Consolidation becoming effective and upon completion of the Rights Issue

Authorised: HK$

1,000,000,000 Shares of HK$0.001 each 1,000,000

Issued and fully paid:

306,874,632 Shares of HK$0.001 each 306,874.63

The Rights Shares, when allotted, issued and fully-paid, shall rank pari passu in all respects with the Shares then in issue. Holder of the Rights Shares in their fully-paid form will be entitled to receive all future dividends and distributions which are declared, made or paid on or after the date of allotment and issue of the fully-paid Rights Shares.

The Company will apply to the Listing Committee of the Stock Exchange for the listing of, and the permission to deal in, the Rights Shares, in both their nil-paid and fully-paid forms. No part of the securities of the Company is listed or dealt in, and no listing of or permission to deal in any such securities is being or is proposed to be sought, on any other stock exchanges.

As at the Latest Practicable Date, the Company has outstanding Share Options entitling the holders thereof to subscribe for a total of 170,496 Shares under the Share Option Scheme.

Save for the Share Options, the Company has no outstanding warrants, options or convertible securities in issue or other similar rights entitling holders thereof to convert into or exchange into or subscribe for new Shares as at the Latest Practicable Date.

As at the Latest Practicable Date, there were no arrangements under which future dividends are waived or agreed to be waived.

III-2 -

APPENDIX III

GENERAL INFORMATION

3. DISCLOSURE OF INTERESTS

(a) Directors' and chief executives' interests and short positions in the Shares and underlying Shares

As at the Latest Practicable Date, the interests and short positions of the Directors and chief executive of the Company in the shares, underlying shares and debentures of the Company or any of the associated corporations (within the meaning of Part XV of the SFO) which (i) are required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they are taken or deemed to have under such provisions of the SFO); or (ii) are required, pursuant to section 352 of the SFO, to be entered in the register as referred to therein; or (iii) are required, pursuant to the Model Code, to be notified to the Company and the Stock Exchange are as follows:

Long position in the shares and underlying shares

Name of Directors	Nature of interests	Number of Shares	Approximate percentage of the issued share capital of the Company
Mr. Ding Zhigang (Note 1)	Beneficial owner	19,670,092	7.69%
Mr. Yu Lu (Note 2)	Beneficial owner	17,252,250	6.75%
Mr. Tsang Wah Tak Brian (Note 3)	Beneficial owner	1,315,000	0.51%

Notes:

Mr. Ding Zhigang is a non-executive Director.
Mr. Yu Lu is a non-executive Director.
Mr. Tsang Wah Tak Brian is an executive Director.
The total issued shares of the Company was 255,728,860 as at the Latest Practicable Date.

Save as disclosed herein, as at the Latest Practicable Date, none of the Directors and the chief executive of the Company had any interests or short positions in the shares, underlying shares or debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO), which would have to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests or short positions which they have taken or deemed to have taken under such provisions of the SFO), or which were required, pursuant to Section 352 of the SFO, to be entered in the register as referred to therein, or which were required to be notified to the Company and the Stock Exchange pursuant to the Model Code.

APPENDIX III

GENERAL INFORMATION

(b) Substantial shareholders and other persons’ interests in Shares and underlying Shares

As at the Latest Practicable Date, so far as the Directors and chief executive of the Company are aware, other than the Director or chief executive of the Company, the following persons had interests or short positions in the shares or underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or which were recorded in the register required to be kept by the Company under Section 336 of the SFO, or as otherwise notified to the Company and the Stock Exchange.

Long position in the Shares

Name of Shareholders	Nature of interests	Number of Shares	Approximate percentage of the issued share capital of the Company
Ms. Liu Beibei	Beneficial owner	33,772,112	13.21%
Ms. Fu Xiaoqin	Beneficial owner	33,000,000	12.90%
Mr. Ning Jun	Beneficial owner	20,280,000	7.93%
XinDaXin Group Company Limited (“XinDaXin”) (Note)	Beneficial owner	17,940,000	7.02%
Mr. Wu Yueshi	Interest in a controlled corporation	17,940,000	7.02%

Note:

XinDaXin is a company incorporated in Hong Kong with limited liability. XinDaXin is wholly owned by Silver Castle International Limited, a company incorporated in BVI with limited liability. Silver Castle International Limited is wholly owned by Mr. Wu Yueshi. By virtue of the SFO, Silver Castle International Limited and Mr. Wu Yueshi are deemed to be interested in the Shares in which XinDaXin is interested.

Save as disclosed above, as at the Latest Practicable Date, so far as is known to the Directors or chief executive of the Company, no person (other than a Director or chief executive of the Company) had, or was taken or deemed to have interests or short positions in the Shares or underlying Shares which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or who was, directly or indirectly, interested in 5% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group.

APPENDIX III

GENERAL INFORMATION

4. DIRECTORS' INTERESTS IN CONTRACTS AND ASSETS OF THE GROUP

As at the Latest Practicable Date, none of the Directors had any interest, direct or indirect, in any assets which had been acquired or disposed of by or leased to any member of the Group, or were proposed to be acquired or disposed of by or leased to any member of the Group since 31 December 2024, the date to which the latest published audited accounts of the Group were made up.

There was no contract or arrangement entered into by any member of the Group, subsisting as at the Latest Practicable Date, in which any of the Directors was materially interested and which was significant in relation to the business of the Group as a whole.

5. DIRECTORS' SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors had entered into or proposed to enter into any service contract with the Company or any of its subsidiaries which is not determinable by the Group within one year without payment of compensation (other than statutory compensation).

6. COMPETING INTERESTS

As at the Latest Practicable Date, so far as the Directors are aware, none of the Directors or controlling shareholders of the Company or their respective associates had any business or interest which competes or may compete with the business of the Group, or have or may have any other conflicts of interest with the Group.

7. LITIGATION

As at the Latest Practicable Date, no member of the Group was engaged in any litigation, claim or arbitration of material importance and there was no litigation, claim or arbitration of material importance known to the Directors to be pending or threatened against any member of the Group.

8. MATERIAL CONTRACTS

Save as disclosed below, there are no material contracts (not being contracts entered into in the ordinary course of business) which have been entered into by any member of the Group within the two years immediately preceding the date of this circular:

(i) the Placing Agreement; and

(ii) the sale and purchase agreement dated 25 August 2023 made between the Company (the "Purchaser"), Ms. Zhu Deyun (朱德雲*) (the "Vendor", an independent third party) and Zhongyi (BVI) International Limited (the "Target Company"), pursuant to which the Vendor agreed to transfer 100% interest in the Target Company to the Purchaser at the total consideration of RMB110,000,000.

III-5 -

APPENDIX III

GENERAL INFORMATION

9. EXPERTS AND CONSENTS

The following is the qualification of the experts or professional advisers who have given opinion or advice contained in this circular (collectively, the "Experts"):

Name	Qualification
Silverbricks Securities Co. Limited	a licensed corporation to carry out type 1 (dealing in securities), type 2 (dealing in futures contracts) and type 6 (advising on corporate finance) regulated under the SFO
Rongcheng (Hong Kong) CPA Limited	Certified Public Accountants

As at the Latest Practicable Date, each of the above Experts has given and has not withdrawn its written consent to the issue of this circular with the inclusion herein of its letters or reports and the reference to its name in the form and context in which they respectively appear.

As at the Latest Practicable Date, none of the Experts had any shareholding in any member of the Group or the right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group.

As at the Latest Practicable Date, none of the Experts had any interest, direct or indirect, in any assets which had been acquired or disposed of by or leased to any member of the Group, or which were proposed to be acquired or disposed of by or leased to any member of the Group since 31 December 2024, being the date to which the latest published audited accounts of the Company were made up.

10. EXPENSES

The expenses in connection with the Rights Issue, including financial advisory fees, placing commission (assuming the Rights Issue is not fully-subscribed and any Unsubscribed Rights Shares are placed by the Placing Agent), printing, registration, translation, legal and accountancy charges are estimated to be up to approximately HK$2.13 million, which are payable by the Company.

APPENDIX III

GENERAL INFORMATION

11. CORPORATE INFORMATION AND PARTIES INVOLVED IN THE RIGHTS ISSUE

| Board of Directors | Executive Directors
Ms. Zhao Luyi (Chairman)
Mr. Tsang Wah Tak, Brian
Mr. Jiang Feng |
| --- | --- |
| | Non-executive Directors
Mr. Yu Lu
Mr. Ding Zhigang
Ms. Guo Lei |
| | Independent non-executive Directors
Mr. Victor Yang
Ms. Lo Wan Man
Mr. Zou Heqiang |
| Registered office | Cricket Square
Hutchins Drive
P.O. Box 2681
Grand Cayman KY1-1111
Cayman Islands |
| Principal place of business in Hong Kong | Unite 4004-5, 40th Floor
Cosco Tower
183 Queen’s Road Central
Hong Kong |
| Authorised representatives | Ms. Zhao Luyi
Ms. Chau Hing Ling |
| Business address of all Directors and authorised representatives | Unite 4004-5, 40th Floor
Cosco Tower
183 Queen’s Road Central
Hong Kong |
| Company secretary | Ms. Chau Hing Ling |
| Principal share registrar and transfer office | Conyers Trust Company (Cayman) Limited
Cricket Square
Hutchins Drive
PO Box 2681
Grand Cayman KY1-1111
Cayman Islands |

III-7 -

APPENDIX III

GENERAL INFORMATION

Hong Kong branch share registrar and transfer office
Tricor Investor Services Limited
17/F, Far East Finance Centre
16 Harcourt Road
Hong Kong

Principal bankers
In Hong Kong:
Bank of China (Hong Kong) Limited
The Hongkong and Shanghai Banking Corporation Limited

In the PRC:
Bank of China Limited
China Merchants Bank

Auditor
SHINEWING (HK) CPA Limited
Certified Public Accountants
17/F, Chubb Tower Windsor House
311 Gloucester Road
Causeway Bay
Hong Kong

Reporting accountants
Rongcheng (Hong Kong) CPA Limited
3203A-05 Tower 2, Lippo Centre
Admiralty, Hong Kong

Legal advisers to the Company
ONC Lawyers
19th Floor, Three Exchange Square
8 Connaught Place, Hong Kong

Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders
Silverbricks Securities Co. Limited
Rooms 1601-07, 16/F, Nan Fung Tower
88 Connaught Road Central
Central, Hong Kong

Placing Agent
Orient Securities Limited
Room 2203-04, 22/F, New World Tower 1
16-18 Queen's Road Central, Hong Kong

III-8 -

APPENDIX III

GENERAL INFORMATION

12. PARTICULARS OF THE DIRECTORS AND SENIOR MANAGEMENT

(a) Biographical details of Directors

Executive Directors

Ms. Zhao Luyi (趙露懷) (“Ms. Zhao”), aged 37, was appointed as an executive Director and the chairman of the Board on 28 June 2024. Ms. Zhao is also a member of remuneration committee and nomination committee of the Company. Ms. Zhao possesses rich experience in investment and management. From 2009 to 2012, Ms. Zhao was a project manager in EV Capital Pte. Ltd., which was engaged in management consultancy services and corporate finance advisory services in Singapore. From 2012 to 2014, Ms. Zhao was the investment director of Shanghai Halo Capital, which was engaged in investment fund management and advisory services. Since 2014, Ms. Zhao acted as an executive director of Ho Hau Financial Leasing (Shanghai) Co. Limited (和厚融資租賃(上海)有限公司). Since 2015, she also acted as an executive director of Shanghai IHOME Investment Development Co. Limited* (上海愛弘投資發展有限公司). Ms. Zhao has a master degree in finance.

On 28 June 2024, Ms. Zhao was appointed as a director of each of Risecomm (HK) Holding Co. Limited (“Risecomm HK”), Risecomm (HK) Technology Co. Limited (“Risecomm HK Technology”), Risecomm Co. Ltd (“Old Cayman”), Harvest Year Global Limited and Prime Key Holdings Limited, and as a general manager of Risecomm HK, subsequent to the resignation of Ms. Guo from such positions on the same day. Ms. Zhao obtained the legal advice required under Rule 3.09D of the Listing Rules and she confirmed that she understood her obligations as a director of a listed issuer in Hong Kong.

Mr. Jiang Feng* (江峰) (“Mr. Jiang”), aged 52, was appointed as an executive Director on 19 April 2021.

Mr. Jiang has extensive experience in sales and sales management. Mr. Jiang has over 27 years of working experience in petroleum and petrochemical industries. Mr. Jiang obtained a bachelor’s degree in Exploration Geophysics from Jianghan Petroleum Institute (江漢石油學院) (currently known as Yangtze University (長江大學)) in June 1994 and obtained a master’s degree of Business Administration from Communication University of China* (中國傳媒大學) in July 2014.

Mr. Jiang is the sales director of Beijing Hongteng Weitong Technology Co., Ltd* (北京鴻騰偉通科技有限公司), which is one of the subsidiaries of the Company.

III-9 -

APPENDIX III

GENERAL INFORMATION

Mr. Tsang Wah Tak, Brian* (曾華德) (“Mr. Tsang”), aged 41, was appointed as an executive Director on 28 June 2024. Mr. Tsang possesses over 15 years of experience in the fields of insurance, financial services and management. From 2008 to 2011, Mr. Tsang worked as financial advisor in CBS Insurance Inc. He further acted as financial advisor for Affinity Financial Services Inc. since 2012. He is also currently an executive director of Enrich Developments which is engaged in real estate development in Canada. Mr. Tsang achieved a qualifying member of the Million Dollar Round Table from 2014 to 2016, and became a member of the Top of the Table in 2021. Mr. Tsang is a licensed person authorized by the Insurance Council of British Columbia to carry on insurance business. Ms. Tsang obtained the legal advice required under Rule 3.09D of the Listing Rules and he understood his obligations as a director of a listed issuer in Hong Kong.

Non-executive Directors

Mr. Yu Lu (于路) (“Mr. Yu”), aged 63, was appointed as a non-executive Director on 9 September 2021. Mr. Yu obtained a bachelor of Arts degree in English from Beijing Union University (北京聯合大學) in July 1988 and obtained an Executive Master's degree of Business Administration (EMBA) from Nankai University* (南開大學) in December 2012. Mr. Yu has worked in Tianjin Precious Metals Exchange Co., Ltd. since 2008 and has been its vice-chairman since 2013. Mr. Yu has extensive experience in the areas of investment and financial services.

Mr. Ding Zhigang (丁志綱) (“Mr. Ding”), aged 64, was appointed as a non-executive Director on 13 January 2022. Mr. Ding obtained a bachelor of laws degree in economic law from China University of Political Science and Law (中國政法大學) in July 1986. He then obtained a master's degree of monetary banking from Chinese Academy of Social Sciences* (中國社會科學院) in November 1998.

Mr. Ding is a lawyer of the People's Republic of China, and he also has extensive experience in investment.

Ms. Guo Lei* (郭磊) (“Ms. Guo”), aged 57, was appointed as an executive Director and the chairman of the Board on 5 June 2023. Ms. Guo was re-designated as a non-executive Director and ceased to be the chairman of the Board on 28 June 2024.

From September 2023 to June 2024, Ms. Guo was a director of Risecomm Microelectronics (Shenzhen) Co., Ltd., Risecomm HK Technology, Old Cayman, Harvest Year Global Limited, Prime Key Holdings Limited and was a general manager of Risecomm HK. Ms. Guo served as a director of Shangyi (BVI) International Limited (January-June 2024), Zhongyi (BVI) International Limited (March-June 2024), and Zhongyi (Hong Kong) International Limited (April-June 2024).

Ms. Guo obtained a bachelor degree in philosophy and a master degree in business administration from Nanjing University* (南京大學) in July 1989 and March 2001, respectively.

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APPENDIX III

GENERAL INFORMATION

Ms. Guo obtained a qualification of senior economist issued by the Personnel Department of Jiangsu Province in December 2001. Ms. Guo possesses rich experience in the new energy industry. From 2005 to 2006, Ms. Guo was the deputy general manager of Jiangsu New Energy Development Co., Ltd. (江蘇省新能源開發股份有限公司) (“Jiangsu New Energy”), a company listed on the Shanghai Stock Exchange (stock code: 603693), Ms. Guo then became the general manager of the company since 2007. From 2015 to 2021, Ms. Guo was appointed as the general manager and chairman of Jiangsu New Energy. From 2021 to 2022, Ms. Guo acted as an external director of Jiangsu Guoxin Group (江蘇省國信集團).

Independent non-executive Directors

Mr. Victor Yang* (楊岳明) (“Mr. Yang”), aged 79, has been appointed as the independent non-executive Director on 5 June 2023. In addition, Mr. Yang is also the chairman of remuneration committee of the Company, a member of audit committee and nomination committee of the Company.

Mr. Yang obtained a Juris Doctorate degree from University of British Columbia in Canada in May 1970. Mr. Yang obtained his bachelor degree in commerce from University of British Columbia in Canada in November 1972. Mr. Yang has over 50 years of experience in legal practice primarily in the areas of corporate finance, commercial law, mergers, acquisitions and private wealth. Mr. Yang is a qualified lawyer in Hong Kong, British Columbia, Canada and the United Kingdom. Mr. Yang is presently a governor of the Canadian Chambers of Commerce in Hong Kong. Mr. Yang is also a member of the University of British Columbia, Canada, Dean of Law’s Council of Advisors since 2010.

Mr. Yang was one of the founders of Boughton Peterson Yang Anderson (“BPYA”) and served as a managing partner from July 1996 to March 2015. Mr. Yang’s partnership was continued under Zhong Lun Law Firms in March 2015, when BPYA changed its name to Zhong Lun Law Firm, and Mr. Yang continues to be a managing partner till March 2017 and remained as a partner till June 2019. In June 2019, Mr. Yang joined Yang Chan & Jamison LLP, a member firm of the Deloitte Legal network, as a managing partner until February 2023. After resigning from Yang Chan & Jamison LLP by the end of February 2023, Mr. Yang set up a new law firm Yang & Yang Solicitors LLP. (now known as YYC Legal LLP) which commenced business on 14 April 2023.

From January 2007 to August 2015, Mr. Yang was an independent non-executive director of China Agri-Industries Holdings Limited (stock code: 606), a company previously listed on the Stock Exchange. From July 2007 to August 2019, Mr. Yang was an independent non-executive director of Playmates Toys Limited (stock code: 869), a company listed on the Stock Exchange, primarily engaged in design, development, and distribution of toys and family products. From April 2008 to July 2019, Mr. Yang was an independent non-executive director of Singamas Container Holdings Limited (stock code: 716), a company listed on the Stock Exchange, primarily engaged in the business of manufacturing of containers and

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APPENDIX III

GENERAL INFORMATION

providing logistics services. From April 2014 to August 2019, Mr. Yang was an independent non-executive director of One Media Group Limited (stock code: 426), a company listed on the Stock Exchange, primarily engaged in media business in Hong Kong. From May 2015 to January 2016, Mr. Yang was an independent non-executive director of China Hanking Holdings Limited (stock code: 3788), a company listed on the Stock Exchange, primarily engaged in iron ore mining.

Mr. Zou Heqiang* (鄒合強) (“Mr. Zou”), aged 56, has been appointed as the independent non-executive Director on 29 May 2019. In addition, Mr. Zou is also a member of the audit committee of the Company.

Mr. Zou graduated from Shanghai Medical University in 1991 with major in forensic medicine and obtained a master degree in Law from the Shanghai Academy of Social Sciences in 2005. Mr. Zou holds the qualifications of lawyer and deputy chief physician of general surgery.

After graduating from undergraduate degree, Mr. Zou has been engaged in the clinical work and management of pathology research, general surgery and intensive care, and obtained the title of deputy chief physician of general surgery. Mr. Zou changed to the lawyer industry in 2008 and is currently practicing at Shanghai Yingdong Law Firm, mainly focusing on the medical dispute resolution, system construction in the field of medical safety management and contract disputes. Mr. Zou was appointed as the legal counsel of the Shanghai Jing'an District Health Commission (上海市靜安區衛生健康委員會) and the mediator of the Shanghai Jing'an District Medical Dispute Resolution Committee (上海市靜安區醫患糾紛調解委員會). At the same time, Mr. Zou has been employed as the legal advisor for certain companies and has accumulated extensive experiences in corporate compliance and risk control.

Ms. Lo Wan Man* (盧頤雯) (“Ms. Lo”), aged 50, has been appointed as the independent non-executive Director on 29 May 2019. Ms. Lo was appointed as the chairman of the nomination committee of the Company and the audit committee of the Company on 5 July 2021 and 5 June 2023, respectively. In addition, Ms. Lo is also a member of the remuneration committee of the Company.

Ms. Lo has over 20 years of experience in the area of accounting, auditing and financial management for both listed and private companies in Hong Kong and the PRC by working in an international accounting firm and other listed companies. Ms. Lo obtained a master of science in finance from City University of Hong Kong in November 2006. Ms. Lo worked at Ernst & Young from March 2001 to December 2003. Ms. Lo was then employed by Emperor Motion Picture (Hong Kong) Limited as finance manager from May 2004 to July 2008. Subsequently, Ms. Lo worked at New World Telecommunications Limited as finance manager in July 2008 until her resignation in March 2010. Ms. Lo was a finance manager of Midland IC&I Limited from May 2011 to January 2014. Ms. Lo was employed by MCGI Consultancy Limited as a senior consultant from May 2015 to September 2022. Ms. Lo has been working at Acclime Corporate Services Limited as director since October 2022.

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APPENDIX III

GENERAL INFORMATION

Ms. Lo has been appointed as an independent non-executive director of Sky Light Holdings Limited, a company listed on the Main Board of the Stock Exchange (stock code: 3882) since 28 November 2022.

Since April 2019, Ms. Lo has been appointed as the company secretary and authorized representative of Man Shun Group (Holdings) Limited, a company listed on the Main Board of the Stock Exchange (stock code: 1746). In addition, Ms. Lo has been appointed as a company secretary and authorized representative of K. H. Group Holdings Limited, a company listed on the Main Board of the Stock Exchange (stock code: 1557) since 3 October 2022.

Ms. Lo is a certified public accountant of the Hong Kong Institute of Certified Public Accountants since January 2003.

Senior management

Ms. Chen Junling (陳俊玲) (“Ms. Chen”), aged 52, is the general manager of Risecomm Beijing Comm responsible for overall supervision of sales and marketing of the AMR business. She has joined the Group as the general manager of Risecomm Beijing Comm since June 2014.

Ms. Chen has over 20 years of experience in electronics and power meter sales and marketing.

Prior to joining the Group, from November 2000 to August 2009, Ms. Chen worked as a sales manager in Beijing Taide Jiaxun Technology Co., Ltd., a company engaged in, among others, the sales of electrical and communication equipment. Ms. Chen was the sales manager of Beijing RSK Electronics from September 2009 to March 2014. Ms. Chen graduated from Henan Province Zhumadian First High School in the PRC in July 1990.

Mr. Liu Ming* (劉明) (“Mr. Liu”), aged 54, is the executive president of Risecomm WFOE since November 2024, responsible for the overall operation and management of the company. Mr. Liu Ming joined the Group in June 2006 as the sales and marketing director of Risecomm WFOE and has been the vice president of Risecomm WFOE from February 2009 to October 2024. Mr. Liu was appointed as a director of Risecomm WFOE from September 2023 to September 2024. Mr. Liu was a director of Risecomm (Beijing) Technology Company Limited from May 2016 to August 2022.

Mr. Liu has approximately 30 years of experience in the intelligent technology industry. From 1994 to 2003, Mr. Liu worked in Shenzhen Kaifa Technology Co., Ltd., a company principally engaged in electronic product research and development and manufacturing electronic products and listed on the Shenzhen Stock Exchange (stock code: 000021), as a product research and development manager initially and then as a sales and marketing manager. From 2003 to 2005, Mr. Liu worked as a

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APPENDIX III

GENERAL INFORMATION

deputy general manager in Shenzhen Haoyuan Technology Co. Ltd. From 2005 to May 2006, Mr. Liu worked in Shenzhen Haoyuan Electronics Co., Ltd., as a deputy general manager.

Mr. Liu obtained a bachelor's degree in Electro-mechanical and Electronic Precision Machinery from the University of Electronic Science and Technology of China in the PRC in July 1994.

Ms. Chen Shuiying (陳水英) (“Ms. Chen SY”), aged 50, is the vice president and financial controller of Risecomm WFOE responsible for financial system management of the Group. Ms. Chen SY has joined the Group as the financial controller of Risecomm WFOE since March 2013. Ms. Chen SY has been a director of each of Risecomm HK and Risecomm HK Technology since December 2015. Ms. Chen SY has been a director of Risecomm WFOE since May 2018 and the vice president of Risecomm WFOE since April 2020. Ms. Chen SY was an executive Director of the Company from July to October 2023.

Ms. Chen SY has approximately 27 years of experience in the areas of finance and accounting. From 1997 to 2001, Ms. Chen SY worked as an account supervisor at Shenzhen Guanlanhu Golf Club Co., Ltd., a golf and leisure resort operator in the PRC. From November 2001 to October 2008, Ms. Chen SY worked as a senior finance manager at Sylva Industries Limited, a Hong Kong company engaged in the manufacturing of rechargeable batteries, responsible for financial analysis. From November 2008 to October 2012, Ms. Chen SY worked as the finance manager (top financial officer) at ASV Stuebbe Pumps & Valves (Shenzhen) Co., Ltd., a company principally engaged in manufacturing and development of plastic pumps, valves and instrumentation systems, responsible for overall financial management of all subsidiaries in Asia.

Ms. Chen SY obtained a bachelor's degree in International Finance from Nanjing Audit University (currently known as Nanjing Audit University) in the PRC in July 1997.

Ms. Zhu Deyun (朱德雲) (“Ms. Zhu”), aged 43, is a director of Zhongyi (Hong Kong) International Limited. Ms. Zhu joined the Group in July 2023. Ms. Zhu also serves as the executive director and general manager of Jiangsu Anyi Engineering Management Co., Ltd., where Ms. Zhu is entrusted with the comprehensive oversight of the company's operation management. Ms. Zhu has extensive management experience in the new energy industry and has led and managed several key local new energy projects, including but not limited to the Baoying Liubao Wind Farm, Baoying Luduo Wind Farm, Jinhu Anfeng Wind Farm, Jinhu Ansheng Wind Farm, and Huai'an Runfeng Wind Farm, etc.

Ms. Zhu graduated from Renmin University of China in July 2015.

APPENDIX III

GENERAL INFORMATION

Mr. Ning Jun (寧軍) (“Mr. Ning”), aged 56, is the president of Risecomm WFOE. Mr. Ning joined the Group in August 2024, serving as executive director and general manager of Wuxi Risecomm Communication Technology Co., Ltd.

Mr. Ning has over 30 years of experience in the real estate and energy-related fields. From 1993 to 2001, Mr. Ning worked in Shanghai Far East Group, where Mr. Ning successively held positions including the business development and management of the Hong Kong business department in Guangdong Province, general manager of the Group's International Trade Center, and Director of the real estate business. From 2001 to 2006, Mr. Ning served as the general manager of Shanghai Ruisuo Investment Co., Ltd. Since 2006, Mr. Ning has been the chairman of Enrich Developments, a Canadian company. In the meantime, since 2020, Mr. Ning has also served as the chairman of Enrich Energy, another Canadian company.

Mr. Ning graduated from the department of architecture at Shanghai Urban Construction College in July 1992.

Ms. Chau Hing Ling* (周慶齡) (“Ms. Chau”), was appointed as the company secretary of the Company on 31 July 2023. Ms. Chau is currently an executive director of corporate services of Vistra Corporate Services (HK) Limited. Ms. Chau has over twenty years of experience in the corporate services industry. She is currently the company secretary/joint company secretary of certain listed companies.

Ms. Chau obtained a master of laws majoring in corporate and financial law from The University of Hong Kong in November 2007. Ms. Chau has been a fellow member of The Hong Kong Chartered Governance Institute (formerly known as The Hong Kong Institute of Chartered Secretaries) and a fellow member of The Chartered Governance Institute (formerly known as The Institute of Chartered Secretaries and Administrators) in United Kingdom since May 2013.

(b) Business address of the Directors and the senior management of the Company

The business address of the Directors, the senior management and authorized representatives is the same as the Company's head office and principal place of business in Hong Kong located at Unite 4004-5, 40th Floor, Cosco Tower, 183 Queen's Road Central, Hong Kong.

AUDIT COMMITTEE

As at the Latest Practicable Date, the audit committee of the Board comprised three independent non-executive Directors, namely, Mr. Victor Yang, Ms. Lo Wan Man and Mr. Zou Heqiang. The audit committee is chaired by Mr. Victor Yang. The audit committee is responsible for monitoring and reviewing the risk management procedures and internal control system of the Group.

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APPENDIX III

GENERAL INFORMATION

14. DOCUMENTS ON DISPLAY

Copies of the following documents will be published on the websites of the Stock Exchange (https://www.hkexnews.hk/) and the Company (http://www.risecomm.com.cn) for 14 days from the date of this circular:

(a) the memorandum and articles of association of the Company;

(b) the annual reports of the Company for each of the three financial years ended 31 December 2022, 2023 and 2024;

(d) the letter from the Board, the text of which is set out on pages 12 to 40 of this circular;

(e) the letter of recommendation from the Independent Board Committee, the text of which is set out on page 41 of this circular;

(f) the letter of advice from the Independent Financial Adviser, the text of which is set out on pages 42 to 63 of this circular;

(g) the accountant’s report on the unaudited pro forma financial information of the Group issued by Rongcheng (Hong Kong) CPA Limited, the text of which is set out in Appendix II to this circular;

(h) the material contracts referred to in the paragraph headed “8. Material contracts” of this appendix;

(i) the written consents from the Experts referred to in paragraph headed “9. Experts and consents” of this appendix; and

(j) this circular.

15. MISCELLANEOUS

(a) As at the Latest Practicable Date, to the best knowledge of the Directors, there was no restriction affecting the remittance of profit or repatriation of capital of the Company into Hong Kong from outside Hong Kong.

(b) As at the Latest Practicable Date, the Group had no exposure to foreign exchange liabilities.

(c) In the event of any inconsistency, the English texts of this circular and the accompanying form of proxy shall prevail over their respective Chinese texts.

For identification purpose only
III-16 -

NOTICE OF EGM

RISECOMM

瑞斯康

RISECOMM GROUP HOLDINGS LIMITED

瑞斯康集團控股有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 1679)

NOTICE OF EXTRAORDINARY GENERAL MEETING

NOTICE IS HEREBY GIVEN that an extraordinary general meeting (the “EGM”) of Risecomm Group Holdings Limited (the “Company”) will be held at Units 5906–12, 59/F, The Center, 99 Queen’s Road Central, Hong Kong on Thursday, 14 August 2025 at 10:00 a.m. for the purpose of considering and, if thought fit, passing with or without amendments, the following resolution as ordinary resolutions of the Company:

ORDINARY RESOLUTIONS

“THAT subject to and conditional upon (i) the compliance with all relevant procedures and requirements under the laws of the Cayman Islands (where applicable) and the Listing Rules to effect the Share Consolidation (as defined below), and (ii) the Listing Committee of the Stock Exchange granting the listing of, and permission to deal in, the Consolidated Shares (as defined below) arising from the Share Consolidation, with effect from the next business day immediately following the day of passing of this resolution, being a day on which the shares of the Company are traded on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”):

(a) every five (5) existing issued and unissued ordinary shares of par value of HK$0.001 each in the authorised share capital of the Company (the “Share(s)”) be consolidated into one (1) ordinary share of par value of HK$0.005 each (the “Consolidated Share(s)”) and such Consolidated Share(s) shall rank pari passu in all respects with each other and have the rights and privileges and be subject to the restrictions in respect of ordinary shares contained in the amended and restated memorandum and articles of association of the Company (the “Share Consolidation”);

(b) immediately following the Share Consolidation, the authorised share capital of the Company be increased from HK$1,000,000 divided into 200,000,000 Consolidated Shares to HK$5,000,000 divided into 1,000,000,000 Consolidated Shares;

(c) no fractional Consolidated Shares will be issued by the Company and any fractional entitlements to the Consolidated Shares will be aggregated and sold for the benefit of the Company; and

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NOTICE OF EGM

(d) any one or more directors of the Company (the “Directors”) be and is/are hereby authorised to approve, sign and execute such documents and do and/or procure to be done any and all acts, deeds and things which in his/her/their opinion may be necessary, desirable or expedient to effect and implement this resolution.”

“THAT:

(a) the authorised share capital of the Company be increased from HK$1,000,000 divided into 200,000,000 Consolidated Shares to HK$5,000,000 divided into 1,000,000,000 Consolidated Shares (the “Increase in Authorised Share Capital”) and;

(b) any one or more Directors be and is/are hereby authorised for and on behalf of the Company to execute all such documents, instruments and agreements and to do all such acts or things deemed by him/her/them to be incidental to, ancillary to or in connection with the matters contemplated in and for completion of the Increase in Authorised Share Capital.”

“THAT conditional upon the passing of resolutions number 1 and 2 as set out above, and subject to the satisfaction of the other conditions set out in the letter from the board under the heading “Conditions of the Rights Issue” in the Circular:

(a) the allotment and issue of 255,728,860 new Consolidated Shares (assuming no change in the number of the Consolidated Shares in issue on or before the Record Date and that no new Consolidated Shares (other than the Rights Shares) will be allotted and issued on or before completion of the Rights Issue) (the “Rights Shares”) pursuant to an offer by way of rights to the shareholders of the Company (the “Shareholders”) at the subscription price of HK$0.5 per Consolidated Share after the Share Consolidation and the Increase in Authorised Share Capital becoming effective (the “Subscription Price”) on the basis of five (5) Rights Shares for every one (1) Consolidated Share held by the Shareholders (the “Qualifying Shareholders”) whose names appear on the register of members of the Company on such other date as may be determined by the Company for determining entitlements of Shareholders to participate in the Rights Issue (as defined below) (the “Record Date”), save for the Shareholders whose addresses as of the Record Date are outside of Hong Kong (if any) to whom the Directors, based on the legal opinions to be provided by the legal advisers of the Company, consider it necessary or expedient not to offer the Rights Shares on account either of the legal restrictions under the laws of the relevant place(s) of their registered address(es) or the requirements under the laws of the relevant regulatory body(ies) or stock exchange(s) in such place(s) (the “Non-Qualifying Shareholders”), and substantially on the terms and conditions set out in the Circular (a copy of which marked “A” is produced to the meeting and initialed by the chairman of the meeting for the purpose of

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NOTICE OF EGM

identification) and such other terms and conditions as may be determined by the Directors (the “Rights Issue”), be and is hereby approved, confirmed and ratified;

(b) the placing agreement dated 17 June 2025 (the “Placing Agreement”) and entered into between the Company and Orient Securities Limited (a copy of which has been produced to the Meeting marked “B” and signed by the chairman of the Meeting for the purpose of identification), in relation to the placing of the Rights Shares not subscribed by the Qualifying Shareholders and/or the Rights Shares which would otherwise have been provisionally allotted to the Non-Qualifying Shareholder(s) in nil-paid form that has/have not been sold by the Company at the placing price of not less than the Subscription Price on a best effort basis, and the transactions contemplated thereunder be and are hereby approved, confirmed and ratified;

(c) the board of Directors or a committee thereof be and is hereby authorised to allot and issue the Rights Shares pursuant to or in connection with the Rights Issue notwithstanding that the same may be offered, allotted or issued otherwise than pro-rata to the existing Shareholders and, in particular, the Directors may make such exclusions or other arrangements in relation to any Non-Qualifying Shareholders, and to do all such acts and things or make such arrangements as it considers necessary, desirable or expedient to give effect to any or all other transactions contemplated in this resolution; and

(d) any one or more Directors be and is/are hereby authorised to do all such acts, deeds and things, to sign and execute all such further documents or deeds and to take such steps as he/they may in his/their absolute discretion consider necessary, appropriate, desirable or expedient to carry out or to give effect to or in connection with the Rights Issue, the Placing Agreement and the transactions contemplated thereunder.”

By Order of the Board
Risecomm Group Holdings Limited
Zhao Luyi
Chairman and executive Director

Registered office:
Cricket Square
Hutchins Drive
P.O. Box 2681
Grand Cayman
KY1-1111
Cayman Islands

Head office and principal place of business in Hong Kong:
Unite 4004–5, 40th Floor
Cosco Tower
183 Queen’s Road Central
Hong Kong

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NOTICE OF EGM

Notes:

Any member of the Company entitled to attend and vote at the EGM is entitled to appoint one or, if he is the holder of two or more shares of the Company, more than one proxy to attend and vote instead of him. A proxy need not be a member of the Company.
In the case of joint holders of Shares, any one of such joint holders may vote, either in person or by proxy, in respect of such Share as if he/she were solely entitled thereto, but if more than one of such joint holders are present at the EGM, personally or by proxy, that one of the said persons so present whose name stands first in the register of members of the Company in respect of such Share shall alone be entitled to vote in respect thereof.
In order to be valid, the form of proxy must be in writing under the hand of the appointor or of his attorney duly authorised in writing, or if the appointor is a corporation, either under seal, or under the hand of an officer or attorney or person authorised, and must be deposited with the Hong Kong branch share registrar and transfer office of the Company, Tricor Investor Services Limited at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong (together with the power of attorney or other authority, if any, under which it is signed or a certified copy thereof) not less than 48 hours before the time fixed for holding of the EGM or any adjournment thereof.
For the purpose of determining members who are qualified for attending and voting at the EGM, the register of members of the Company will be closed from Friday, 8 August 2025 to Thursday, 14 August 2025, both days inclusive, during which no transfer of Shares will be effected. In order to qualify for attending and voting at the EGM, all transfers of Shares, accompanied by the relevant share certificates, must be lodged with the Registrar at the address stated in note 3 above not later than 4:30 p.m. on Thursday, 7 August 2025 for registration.
Delivery of an instrument appointing a proxy should not preclude a member from attending and voting in person at the above EGM or any adjournment thereof and in such event, the instrument appointing a proxy shall be deemed to be revoked.
According to Rule 13.39(4) of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, voting on the proposed resolution set out in this notice will be taken by a poll.
If a black rainstorm warning signal, a tropical cyclone warning signal no. 8 or above or "extreme conditions" caused by super typhoons is in force at or at any time after 7:00 a.m. on the date of the meeting, the meeting will be postponed. The Company will publish an announcement on the Company's website at http://www.risecomm.com.cn and the website of Hong Kong Exchanges and Clearing Limited at www.hkexnews.hk to notify members of the date, time and place of the rescheduled meeting.
All times and dates specified herein refer to Hong Kong local times and dates.

As at the date hereof, the Board of Directors comprises Ms. Zhao Luyi, Mr. Tsang Wah Tak, Brian and Mr. Jiang Feng as Executive Directors, Mr. Yu Lu, Mr. Ding Zhigang, and Ms. Guo Lei as Non-executive Directors; and Mr. Victor Yang, Ms. Lo Wan Man and Mr. Zou Heqiang as Independent Non-Executive Directors.

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AI assistant

Risecomm Group Holdings Limited — Proxy Solicitation & Information Statement 2025

50085_rns_2025-07-22_acaac11f-54ab-4b82-961d-c3fd56b884c5.pdf

RISECOMM

瑞斯康

RISECOMM GROUP HOLDINGS LIMITED

瑞斯康集團控股有限公司

(I) PROPOSED SHARE CONSOLIDATION;

(II) PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL;

(III) PROPOSED RIGHTS ISSUE ON THE BASIS OF FIVE (5) RIGHTS

SHARES OF EVERY ONE (1) CONSOLIDATED SHARE HELD ON

THE RECORD DATE ON A NON-UNDERWRITTEN BASIS; AND

(IV) NOTICE OF EXTRAORDINARY GENERAL MEETING

EFFECT OF BAD WEATHER AND/OR EXTREME CONDITIONS ON THE LATEST TIME FOR ACCEPTANCE

RISECOMM

瑞斯康

RISECOMM GROUP HOLDINGS LIMITED

瑞斯康集團控股有限公司

INTRODUCTION

1. PROPOSED SHARE CONSOLIDATION

Effects of the Share Consolidation

Conditions of the Share Consolidation

Application for listing of the Consolidated Shares

Fractional entitlement to the Consolidated Shares

Odd lots arrangement and matching services

Exchange of share certificates

Reasons for the Share Consolidation

2. PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL

3. PROPOSED RIGHTS ISSUE

Issue statistics

Undertakings

Qualifying Shareholders

Closure of register of members

Subscription Price

Status of the Rights Shares

Basis of provisional allotments

Rights of the Overseas Shareholders

No fractional entitlement

Application for listing

Rights Shares will be eligible for admission into CCASS

Stamp duty and other applicable fees

Share certificates and refund cheques for Rights Issue

Non-underwritten basis

Procedures in respect of the Unsubscribed Rights Shares and the Unsubscribed Arrangements

The Placing Agreement

Conditions of the Rights Issue

Reasons for the Rights Issue and the intended use of proceeds

Conclusion

4. POSSIBLE ADJUSTMENT TO THE SHARE OPTIONS UNDER THE SHARE OPTION SCHEME

5. FUNDRAISING ACTIVITIES IN THE PAST TWELVE MONTHS

6. EFFECTS ON THE SHAREHOLDING STRUCTURE OF THE COMPANY

7. LISTING RULES IMPLICATIONS

8. EGM

9. TYPHOON OR BLACK RAINSTORM WARNING ARRANGEMENTS

10. FURTHER INFORMATION

11. RECOMMENDATION

12. ADDITIONAL INFORMATION

WARNING OF THE RISK OF DEALINGS IN THE SHARES AND RIGHTS SHARES IN NIL-PAID FORM

RISECOMM

瑞斯康

RISECOMM GROUP HOLDINGS LIMITED

瑞斯康集團控股有限公司

PROPOSED RIGHTS ISSUE ON THE BASIS OF FIVE (5) RIGHTS SHARES OF EVERY ONE (1) CONSOLIDATED SHARE HELD ON THE RECORD DATE ON A NON-UNDERWRITTEN BASIS

PROPOSED RIGHTS ISSUE ON THE BASIS OF FIVE (5) RIGHTS SHARES OF EVERY ONE (1) CONSOLIDATED SHARE HELD ON THE RECORD DATE ON A NON-UNDERWRITTEN BASIS

INTRODUCTION

THE INDEPENDENT BOARD COMMITTEE

BASIS OF OUR OPINION

PRINCIPAL FACTORS AND REASONS CONSIDERED

1. Background information of the Group

(a) Financial Performance of the Group

(b) Financial Position of the Group

Audited consolidated results for the two years ended 31 December 2024

2. Reasons for and benefits of the Rights Issue and use of proceeds

Settlement of the Group's loans

General Corporate and Administrative Working Capital Purposes

Alternative financing methods

3. Principal terms of the Rights Issue

Assessment on the principal terms of the Rights Issue

The Subscription Price

Comparison with historical closing prices of the Shares

Risecomm Group Holdings Limited Proxy Solicitation & Information Statement 2025