SAPPHIRE : Updates To The Proposed Capital Reduction And Capital Distribution

SAPPHIRE CORPORATION LIMITED

(Incorporated in the Republic of Singapore)

(Company Registration No. 198502465W)

UPDATES TO THE PROPOSED CAPITAL REDUCTION AND CAPITAL DISTRIBUTION

• COMPLETION OF CAPITAL REDUCTION EXERCISE OF CHENGDU KAI QI RUI BUSINESS MANAGEMENT CO., LTD.

1. INTRODUCTION

1. The board of directors (the "Board") of Sapphire Corporation Limited (the "Company") refers to the announcement dated 31 December 2020 in relation to the Company's intention to undertake a capital reduction exercise involving the reduction of the share capital of the Company to the extent of the amount of Accumulated Losses and the Proposed Cash Distribution and the update announcement on the same matter dated 3 June 2022 ("Previous Announcements").
2. Unless otherwise expressly defined or described herein, all capitalised terms used in this announcement ("Announcement") shall have the same meanings as defined in the Previous Announcements.

2. PROPOSED CAPITAL REDUCTION

1. As mentioned in the Previous Announcement of 3 June 2022 and in relation to the Proposed Capital Reduction, the Company's direct and indirect subsidiaries, Ranken Holding and Chengdu KQR respectively, were each to undertake a capital reduction exercise.
2. The Board wishes to update that the capital reduction exercise in relation to Chengdu KQR had been completed on 21 July 2022 and accordingly, the registered share capital of Chengdu KQR had been reduced from RMB 229,080,000 to RMB 132,980,000.
3. The Board will accordingly provide further updates of Proposed Capital Reduction and its subsequent Proposed Cash Distribution upon the completion of the ongoing capital reduction exercise in relation to Ranken Holding.

3. CAUTIONARY STATEMENT

Shareholders and potential investors are advised to exercise caution when dealing or trading in the Shares. The completion of the Proposed Capital Reduction and Proposed Cash Distribution are subject to certain conditions. As at the date of this Announcement, there is no certainty or assurance that the Proposed Capital Reduction and Proposed Cash Distribution may be approved or completed or that no changes will be made to the terms thereof. The Proposed Capital Reduction and Proposed Cash Distribution is subject to the Company's adoption and Shareholder's approval and is also subject to certain conditions.

The Company will make the necessary announcements when there are further developments. Shareholders and potential investors are advised to read this Announcement and any further announcements by the Company carefully. Shareholders and potential investors should consult their stockbrokers, bank managers, solicitors, accountants, tax advisers or other professional advisers if they have any doubt about the actions they should take.

By Order of the Board

WANG HENG

Executive Director and Chief Executive Officer

25 July 2022

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