Common use of ANNUAL CAP Clause in Contracts

ANNUAL CAP. The maximum annual aggregate Royalty payable by the Company to AFS Japan under the 2025 Royalty Renewal Agreement is estimated to be HK$9,000,000 (approximately JPY167,000,000) for the year ending 28 February 2026. The Annual Cap is set based on the Group’s audited consolidated operating revenue for the financial year ending 28 February 2026, as to be reported in AFS Japan’s audited consolidated financial statements, with a buffer to account for potential appreciation in the JPY. The 2024 Aggregate Royalty is expected to be not exceeding HK$4,500,000. Shareholders should note that the Annual Cap and the 2024 Aggregate Royalty only represent the Company’s best estimates of the respective maximum transaction amounts based on information currently available. Neither the Annual Cap nor the 2024 Aggregate Royalty is, or should be interpreted as, indicative of the Group’s actual financial performance or its future financial potential in any manner whatsoever. The Directors believe that the entering into of the 2025 Royalty Renewal Agreement reflects the Company’s ongoing due recognition of the market value of the AEON Trademarks, while contractually ensures their continued use through legal agreement that clearly sets out the related rights and obligations, thereby giving greater certainty and stability to the Group and its operations. The Directors, including the independent non-executive Directors, are of the view that the 2025 Royalty Renewal Agreement is on normal commercial terms, fair and reasonable, and is entered into in the ordinary and usual course of business of the Company. Furthermore, they believe that the transactions contemplated under the 2025 Royalty Renewal Agreement are in the interests of the Group and the shareholders of the Company as a whole and are on terms no less favourable to the Company than those available from or to independent third parties. AFS Japan is a Controlling Shareholder of the Company and is interested in approximately 56.54% of the issued shares of the Company. AFS Japan is therefore a connected person of the Company, and the 2025 Royalty Renewal Agreement constitutes a continuing connected transaction of the Company under Chapter 14A of the Listing Rules. As each of the applicable percentage ratios for the Annual Cap exceeds 0.1% but is less than 5%, the 2025 Royalty Renewal Agreement is subject to the reporting, announcement, and annual review requirements but exempt from the independent shareholders’ approval requirements under Chapter 14A of the Listing Rules. None of the Directors has a material interest in the transactions contemplated under the 2025 Royalty Renewal Agreement, save for ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇ who is a director of AFS Japan. Accordingly, ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇ has abstained from voting on the Board resolutions approving the 2025 Royalty Renewal Agreement.

ANNUAL CAP. The maximum annual aggregate Royalty transaction amount payable by the Company to AFS Japan under the 2025 Royalty 2018 Renewal Agreement is estimated to be HK$9,000,000 HK$14,900,000 (approximately JPY167,000,000the “Annual Cap”) for the year ending 28 February 20262019. The annual aggregate transaction amounts paid by the Company to AFS HK under the Business Advisory Service Agreement were approximately HK$5,817,000, HK$11,567,000 and HK$13,678,000 respectively for the three years ended 28 February 2018. The Annual Cap is set based on has been determined with reference to (i) the Group’s audited consolidated historical transaction amounts; and (ii) the estimated operating revenue expenses to be incurred by the relevant departments of AFS HK and/or AFS Japan in providing the Services for the financial year ending period from 1 March 2018 to 28 February 2026, as to be reported in AFS Japan’s audited consolidated financial statements, with a buffer to account for potential appreciation in the JPY2019. The 2024 Aggregate Royalty is expected to be not exceeding HK$4,500,000. Shareholders should note Board believes that the Annual Cap Services, which are tailored to the unique requirements and the 2024 Aggregate Royalty only represent the Company’s best estimates of the respective maximum transaction amounts based on information currently available. Neither the Annual Cap nor the 2024 Aggregate Royalty is, or should be interpreted as, indicative circumstances of the Group’s actual financial performance or , would continue to enable the Group to benefit from the expertise and experience of AFS HK and AFS Japan in the consumer finance industry. Through the Services, the Group is likely to keep on improving its future financial potential productivity, credit scoring processes and bad debt management, which are conducive to business growth in any manner whatsoeverboth Hong Kong and China. The Directors believe that Independent third parties with comparable expertise and/or experience in the entering into of consumer finance industry may not be available to provide the 2025 Royalty Renewal Agreement reflects the Company’s ongoing due recognition of the market value of the AEON Trademarks, while contractually ensures their continued use through legal agreement that clearly sets out the related rights and obligations, thereby giving greater certainty and stability Services to the Group and its operationsGroup. The Directors, including the independent nonIndependent Non-executive Directors, are of the view consider that the 2025 Royalty 2018 Renewal Agreement is on normal commercial terms, fair and reasonable, and is entered into in the ordinary and usual course of business of the Company. Furthermore, they believe that the transactions contemplated under terms of the 2025 Royalty 2018 Renewal Agreement are on normal commercial terms, and both the terms of the 2018 Renewal Agreement and the Annual Cap are fair and reasonable and in the interests of the Group and the shareholders of the Company as a whole and are on terms no less favourable to the Company than those available from or to independent third partieswhole. AFS Japan HK is a Controlling Shareholder controlling shareholder of the Company and is interested in approximately 56.5452.86% of the issued shares of the Company. AFS Japan HK is a wholly-owned subsidiary of AFS Japan. AFS HK is therefore a connected person of the Company, Company and the 2025 Royalty 2018 Renewal Agreement constitutes a continuing connected transaction of the Company under Chapter 14A of the Listing Rules. As each of the applicable percentage ratios for the Annual Cap exceeds 0.1% but is less than 5%, the 2025 Royalty 2018 Renewal Agreement is subject to the reporting, announcement, announcement and annual review requirements requirements, but exempt from the independent shareholders’ approval requirements under Chapter 14A of the Listing Rules. None of the Directors has a material interest in the transactions contemplated under the 2025 Royalty 2018 Renewal Agreement, save for ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇ Mr. Masaaki Mangetsu who is a director of AFS Japan. Accordingly, ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇ Mr. Masaaki Mangetsu has abstained from voting on the Board resolutions approving the 2025 Royalty 2018 Renewal Agreement.

ANNUAL CAP. The maximum annual aggregate Royalty transaction amount payable by the Company to AFS Japan under the 2025 Royalty 2019 Renewal Agreement is estimated to be HK$9,000,000 HK$14,900,000 (approximately JPY167,000,000the “Annual Cap”) for the year ending 29 February 2020. The annual aggregate transaction amounts paid by the Company to AFS HK under the Business Advisory Service Agreement were approximately HK$11,567,000, HK$13,678,000 and HK$14,300,000 respectively for the three years ended 28 February 20262019. The Annual Cap is set based on has been determined with reference to (i) the Group’s audited consolidated historical transaction amounts; and (ii) the estimated operating revenue expenses to be incurred by the relevant departments of AFS HK and/or AFS Japan in providing the Services for the financial year ending 28 period from 1 March 2019 to 29 February 2026, as to be reported in AFS Japan’s audited consolidated financial statements, with a buffer to account for potential appreciation in the JPY2020. The 2024 Aggregate Royalty is expected to be not exceeding HK$4,500,000. Shareholders should note Board believes that the Annual Cap Services, which are tailored to the unique requirements and the 2024 Aggregate Royalty only represent the Company’s best estimates of the respective maximum transaction amounts based on information currently available. Neither the Annual Cap nor the 2024 Aggregate Royalty is, or should be interpreted as, indicative circumstances of the Group’s actual financial performance or , would continue to enable the Group to benefit from the expertise and experience of AFS HK and AFS Japan in the consumer finance industry. Through the Services, the Group is expecting to improve its future financial potential in any manner whatsoever. The Directors believe that strategic planning as well as its innovation capability, which is likely to contribute to the entering into sustainable business growth of the 2025 Royalty Renewal Agreement reflects Group in the Company’s ongoing due recognition of long run. Independent third parties with comparable expertise and/or experience in the market value of consumer finance industry may not be available to provide the AEON Trademarks, while contractually ensures their continued use through legal agreement that clearly sets out the related rights and obligations, thereby giving greater certainty and stability Services to the Group and its operationsGroup. The Directors, including the independent nonIndependent Non-executive Directors, are of the view consider that the 2025 Royalty 2019 Renewal Agreement is on normal commercial terms, fair and reasonable, and is entered into in the ordinary and usual course of business of the Company. Furthermore, they believe that the transactions contemplated under terms of the 2025 Royalty 2019 Renewal Agreement are on normal commercial terms, and both the terms of the 2019 Renewal Agreement and the Annual Cap are fair and reasonable and in the interests of the Group and the shareholders of the Company as a whole and are on terms no less favourable to the Company than those available from or to independent third partieswhole. AFS Japan HK is a Controlling Shareholder controlling shareholder of the Company and is interested in approximately 56.5452.86% of the issued shares of the Company. AFS Japan HK is a wholly-owned subsidiary of AFS Japan. AFS HK is therefore a connected person of the Company, Company and the 2025 Royalty 2019 Renewal Agreement constitutes a continuing connected transaction of the Company under Chapter 14A of the Listing Rules. As each of the applicable percentage ratios for the Annual Cap exceeds 0.1% but is less than 5%, the 2025 Royalty 2019 Renewal Agreement is subject to the reporting, announcement, announcement and annual review requirements requirements, but exempt from the independent shareholders’ approval requirements under Chapter 14A of the Listing Rules. None of the Directors has a material interest in the transactions contemplated under the 2025 Royalty 2019 Renewal Agreement, save for Mr. ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ who is a director of AFS Japan. Accordingly, Mr. ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ has abstained from voting on the Board resolutions approving the 2025 Royalty 2019 Renewal Agreement.