Natural Cool : Letter To Shareholders

NATURAL COOL HOLDINGS LIMITED

(Incorporated in the Republic of Singapore)

(Company Registration No.: 200509967G)

LETTER TO SHAREHOLDERS Directors Registered Office

Mr. Joseph Ang Choon Cheng (Executive Chairman) 29 Tai Seng Avenue #07-01 Mr. Tsng Joo Peng (Executive Director and Chief Executive Officer) Natural Cool Lifestyle Hub Mr. Eric Ang Choon Beng (Executive Director) Singapore 534119

Mr. Lim Siang Kai (Lead Independent Director) Dr. Wu Chiaw Ching (Independent Director) Mr. William da Silva (Independent Director)

27 January 2017

To: The Shareholders of Natural Cool Holdings Limited

Dear Shareholders,

THE CALLING FOR A MEETING OF THE SHAREHOLDERS PURSUANT TO SECTION 177 OF THE COMPANIES ACT, CHAPTER 50 OF SINGAPORE, FOR:

1. THE PROPOSED REMOVAL OF JOSEPH ANG CHOON CHENG AS DIRECTOR OF THE COMPANY;
2. THE PROPOSED REMOVAL OF ERIC ANG CHOON BENG AS DIRECTOR OF THE COMPANY;
3. THE PROPOSED REMOVAL OF LIM SIANG KAI AS DIRECTOR OF THE COMPANY;
4. THE PROPOSED REMOVAL OF WU CHIAW CHING AS DIRECTOR OF THE COMPANY;
5. THE PROPOSED REMOVAL OF WILLIAM DA SILVA AS DIRECTOR OF THE COMPANY;
6. THE PROPOSED APPOINTMENT OF LAU LEE HUA AS DIRECTOR OF THE COMPANY;
7. THE PROPOSED APPOINTMENT OF TAN SIEW BIN RONNIE AS DIRECTOR OF THE COMPANY;
8. THE PROPOSED APPOINTMENT OF GOH TECK SIA AS DIRECTOR OF THE COMPANY; AND
9. THE PROPOSED APPOINTMENT OF WONG LEON KEAT AS DIRECTOR OF THE COMPANY.

This Letter has been prepared by the Company and its contents have been reviewed by the Company's sponsor, PrimePartners Corporate Finance Pte. Ltd., for compliance with the Singapore Exchange Securities Trading Limited (the "SGX-ST") Listing Manual Section B: Rules of Catalist. The Sponsor has not verified the contents of this Letter.

This Letter has not been examined or approved by the SGX-ST. The Sponsor and the SGX-ST assume no responsibility for the contents of this Letter including the accuracy, completeness or correctness of any of the information, statements or opinions made or reports contained in this Letter.

The contact person for the Sponsor is Mr. Thomas Lam, Associate Director, Continuing Sponsorship, at 16 Collyer Quay, #10-00 Income at Raffles, Singapore 049318, telephone number: (65) 6229 8088.

1. DEFINITIONS AND INTERPRETATION

   In this Letter, the following definitions and interpretations apply throughout unless otherwise stated:

   "25 November 2016 Circular" : The circular to Shareholders dated 25 November 2016

   "Act" : The Companies Act, Chapter 50 of Singapore, as may be amended or modified from time to time

   "Aircon Business" : The business of trading and supplying air-conditioners and

   parts, including the manufacturing of air-conditioner ducts and the installation, repair and maintenance of air-conditioners

   "Alternative Advisors" : Alternative Advisors Pte. Ltd.

   "Board" : The board of directors of the Company for the time being "Catalist Rules" : The SGX-ST Listing Manual, Section B: Rules of Catalist, as

   may be amended, supplemented or revised from time to time

   "CDP" : The Central Depository (Pte) Limited

   "Chairman" : The chairman of the Board or the chairman of the Board committees, as the case may be

   "Code of Corporate : The Singapore Code of Corporate Governance 2012

   Governance"

   "Company" : Natural Cool Holdings Limited

   "Company Secretary" : The company secretary of the Company from time to time "Constitution" : The constitution of the Company, as may be amended from

   time to time

   "Directors" : The directors of the Company as at the Latest Practicable Date

   "Dr. Wu" : Dr. Wu Chiaw Ching, an Independent Director

   "EGM" : The extraordinary general meeting of the Company convened by the Relevant Members to be held on 8 February 2017 at 2:30 p.m. at Conference Room 2, TKP Conference Centre, 55 Market Street #03-01, Singapore 048941, notice of which is appended as Appendix A of this Letter

   "Executive Director" : An executive director of the Company for the time being "FY" : The financial year ended or ending 31 December "Gathergates Group" : Gathergates Group Pte. Ltd.

   "Group" : The Company and its subsidiaries

   "HMKE" : HMK Energy Pte. Ltd.

   "Independent Director" : An independent director of the Company for the time being and

   collectively the "Independent Directors"

   "Latest Practicable Date" : 20 January 2017, being the latest practicable date prior to the

   printing of this Letter

   "Letter" : This letter to Shareholders dated 27 January 2017

   "Majority of the Board" : Messrs Joseph Ang Choon Cheng, Eric Ang Choon Beng, Lim

   Siang Kai, Wu Chiaw Ching, and William da Silva, collectively comprising the Board (save for Mr. Tsng Joo Peng), and who are individually the subject of Ordinary Resolutions 1, 2, 3, 4 and 5 respectively as set out in the Notice of EGM

   "Mr. da Silva" : Mr. William da Silva, an Independent Director

   "Mr. Eric Ang" : Mr. Eric Ang Choon Beng, an Executive Director

   "Mr. Joseph Ang" : Mr. Joseph Ang Choon Cheng, an Executive Director and

   Chairman of the Board

   "Mr. Lim" : Mr. Lim Siang Kai, an Independent Director

   "Nominating Committee" : The nominating committee of the Company as at the Latest

   Practicable Date, comprising Dr. Wu Chiaw Ching, Mr. Lim Siang Kai and Mr. William da Silva

   "Notice of EGM" : The notice of EGM dated 23 January 2017, which was received

   by the Company on 19 January 2017, put forth the by the Relevant Members to the Shareholders, calling for the EGM pursuant to Section 177 of the Act, to consider, inter alia, the Ordinary Resolutions set out in the notice appended as Appendix A of this Letter

   "Ordinary Resolutions" : The ordinary resolutions set out in the Notice of EGM

   "Paint Business" : The business of manufacturing and trading of paint and basic

   chemicals

   "Proposed Appointment of : Ordinary Resolutions 6, 7, 8 and 9, collectively, as set out in

   New Directors" the Notice of EGM

   "Proposed Divestment" : The resolution of the Majority of the Board on 29 September

   2016 to divest the Company's entire interest in 160,000 ordinary shares in the share capital of HMKE representing 16.0% of the issued and paid-up share capital of HMKE

   "Proposed New Directors" : Mdm Lau Lee Hua, Mr. Tan Siew Bin Ronnie, Mr. Goh Teck Sia

   and Mr. Wong Leon Keat, collectively

   "Proposed Removal of : Ordinary Resolutions 1, 2, 3, 4 and 5, collectively, as

   the Majority of the Board" set out in the Notice of EGM "Register of Members" : Register of members of the Company

   "Relevant Members" : Mr. Ong Mun Wah and Ms. Edi Ng, who at the date of the

   Special Notice held collectively not less than 10.0% of the total number of issued and paid-up Shares carrying the right to vote at general meetings of the Company

   "SGX-ST" : Singapore Exchange Securities Trading Limited

   "Shareholders" : Registered holders of Shares in the register of members of the

   Company, except that where the registered holder is CDP, the term "Shareholders" shall, in relation to such Shares, mean the persons named as Depositors in the depository register maintained by CDP and whose securities accounts maintained with CDP are credited with the Shares

   "Shares" : Ordinary shares in the capital of the Company

   "Special Notice" : The special notice from the Relevant Members dated 9 January

   2017 received by the Company on the same day, constituting special notice under Section 152(2) read with Section 185 of the Act, a copy of which is attached in the Company's announcement dated 10 January 2017

   "Special Notice Letter" : The letter from the Relevant Members dated 19 January 2017

   received by the Company on the same day, setting out, inter alia, information relating to the Ordinary Resolutions. A copy of the Special Notice Letter is attached in the Company's announcement dated 20 January 2017

   "Sponsor" : PrimePartners Corporate Finance Pte. Ltd.

   "subsidiary" : A company which is for the time being a subsidiary of the Company, as defined by Section 5 of the Act

   "%" or "per cent." : Per centum or percentage

   The terms "Depositor", "Depository Agent" and "Depository Register" shall have the meanings ascribed to them in Section 81SF of the Securities and Futures Act, Chapter 289 of Singapore.

   Words importing the singular shall, where applicable, include the plural and vice versa and words importing the masculine gender shall, where applicable, include the feminine and neuter genders. References to persons shall include corporations.

   Any reference in this Letter to any enactment is a reference to that enactment as for the time being amended or re-enacted. Any word defined under the Act, the Catalist Rules or any modification thereof and not otherwise defined in this Letter shall have the meaning assigned to it under the Act, the Catalist Rules or any modification thereof, as the case may be.

   The headings in this Letter are inserted for convenience only and shall be ignored in construing this Letter.

   Any reference to a time of day in this Letter shall be a reference to Singapore time unless otherwise stated.

   Any discrepancies in the tables in this Letter between the listed amounts and the totals thereof are due to rounding. Accordingly, figures shown as totals may not be an aggregation of the figures that precede them.
2. INTRODUCTION

2.1 On 10 January 2017, the Company announced that it had on 9 January 2017 received the Special Notice from the Relevant Members notifying the Company of their intention to convene the EGM. On 20 January 2017, the Company further announced that it had on 19 January 2017 received the Special Notice Letter from the Relevant Members, enclosing the Notice of EGM dated 23 January 2017, for the purposes of convening the EGM pursuant to Section 177 of the Act. The Relevant Members collectively held approximately 15.46% of the Shares as at 9 January 2017, 19 January 2017 and the Latest Practicable Date.