CapitaLand Integrated Commercial Trust : Letter to Unitholders dated 22 March 2022

CAPITALAND INTEGRATED COMMERCIAL TRUST

(Constituted in the Republic of Singapore pursuant to a trust deed dated 29 October 2001 (as amended))

Letter to Unitholders Dated 22 March 2022

22 March 2022

To: The unitholders of CapitaLand Integrated Commercial Trust

Dear Sir/Madam

1 INTRODUCTION

1. Summary
   We refer to proposed Ordinary Resolution 4 under the "Special Business" section of the notice dated 22 March 2022 convening the annual general meeting of CapitaLand Integrated Commercial Trust ("CICT") to be held by way of electronic means on Thursday, 21 April 2022 at 2.30 p.m. (Singapore Time) ("AGM").
   Ordinary Resolution 4 relates to the proposed renewal of the unit buy-back mandate of CapitaLand Integrated Commercial Trust Management Limited, as manager of CICT (the "Manager"). The Manager's existing mandate to exercise its powers to procure the repurchases of units in CICT ("Units") for and on behalf of CICT without the prior specific approval of the holders of Units ("Unitholders") in a general meeting was approved by Unitholders at the annual general meeting of CICT that was held on 14 April 2021, and such mandate expires on 21 April 2022, being the date of the AGM. In this regard, the Manager seeks approval from Unitholders at the AGM in relation to the renewal of the mandate to exercise its powers to procure the repurchases of Units without the prior specific approval of Unitholders in a general meeting (the "Unit Buy-BackMandate").
2. This Letter
   The purpose of this Letter is to provide Unitholders with information relating to the above proposal which will be tabled at the AGM.
3. Advice to Unitholders
   Unitholders should note that by approving the resolution relating to the Unit Buy-Back Mandate, they will be renewing the authority of the Manager to procure the repurchases of Units on the terms and conditions set out in paragraph 2 of this Letter and in accordance with all applicable laws and regulations, including but not limited to the provisions of the trust deed dated 29 October 2001 constituting CICT (as amended, varied or supplemented from time to time) (the "Trust Deed") and the Listing Manual of the SGX-ST (the "Listing Manual").
   (See "The Proposed Renewal of the Unit Buy-Back Mandate" in paragraph 2 of this Letter for further details.)
   If a Unitholder is in any doubt as to the action he should take, he should consult his stockbroker, bank manager, solicitor, accountant or other professional adviser immediately.
4. Singapore Exchange Securities Trading Limited ("SGX-ST")
   The SGX-ST assumes no responsibility for the accuracy of any statements or opinions made, or reports contained, in this Letter.

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Letter to Unitholders Dated 22 March 2022

2 THE PROPOSED RENEWAL OF THE UNIT BUY-BACK MANDATE

2.1 Rationale for the Unit Buy-Back Mandate

The approval of the renewal of the Unit Buy-Back Mandate authorising the Manager to repurchase Units for and on behalf of CICT would give the Manager the flexibility to undertake repurchases of Units of up to the 1.0% limit described in paragraph 2.2.1 of this Letter at any time, during the period when the Unit Buy-Back Mandate is in force ("Unit Buy-Back").

The rationale for seeking the Unit Buy-Back Mandate is as follows:

1. the Unit Buy-Back Mandate would be a flexible and cost-effective capital management tool to enhance return on equity for Unitholders and/or the net asset value ("NAV") per Unit; and
2. the Unit Buy-Back Mandate, when exercised at appropriate times, would help mitigate short-term market volatility, off-set the effects of short-term speculative trading of the Units and bolster market confidence in the Units.

While the Unit Buy-Back Mandate would authorise Unit Buy-Backs of up to the said 1.0% limit during the period when the Unit Buy-Back Mandate is in force, Unitholders should note that Unit Buy-Backs may not necessarily be carried out to the entire 1.0% limit as authorised by Unitholders.

Repurchases of Units will be made only when the Manager considers it to be in the best interests of CICT and the Unitholders.

Rule 723 of the Listing Manual requires CICT to ensure that at least 10.0% of its Units are at all times held by the public (the "Public Float"). As at 24 February 2022, being the latest practicable date prior to the issuance of this Letter (the "Latest Practicable Date"), the Public Float is approximately 71.0%, and accordingly, the Manager is of the view that the orderly trading and the listing status of the Units on the SGX-ST is not likely to be affected by the Unitholders' approval of the Unit Buy-Back Mandate and the repurchases of Units thereunder.

2.2 Authority and Limits on the Unit Buy-Back Mandate

The authority conferred on the Manager and the limits placed on the repurchases of Units by the Manager under the Unit Buy-Back Mandate are set out below:

2.2.1 Maximum Limit

The total number of Units which may be repurchased pursuant to the Unit Buy-Back Mandate is limited to that number of Units representing not more than 1.0% of the total number of issued Units as at the date of the AGM.1

FOR ILLUSTRATIVE PURPOSES ONLY: On the basis of 6,608,618,340 Units in issue as at the Latest Practicable Date, and assuming that no further Units are issued on or prior to the AGM at which the Unit Buy-Back Mandate is approved, not more than 66,086,183 Units (representing 1.0% of the issued Units) may be repurchased by the Manager pursuant to the Unit Buy-Back Mandate during the Mandate Duration (as defined herein).

1 Pursuant to the Listing Manual, a unit buy-back shall not exceed 10.0% of the total number of issued units excluding treasury units and subsidiary holdings in each class as at the date of the resolution passed by unitholders for the unit buy-back. For the avoidance of doubt, CICT does not hold any treasury units and there are no subsidiary holdings as none of the subsidiaries of CICT hold any Units. There is also only one class of units in CICT.

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Letter to Unitholders Dated 22 March 2022

2.2.2 Duration of Authority

Unless revoked or varied by Unitholders in a general meeting, the Unit Buy-Back Mandate, if approved by Unitholders, will be in force from the period commencing from the date on which the AGM is held and the Unit Buy-Back Mandate is approved and expiring on the earliest of the following dates:

1. the date on which the next annual general meeting of CICT is held;
2. the date by which the next annual general meeting of CICT is required by applicable laws and regulations or the provisions of the Trust Deed to be held; or
3. the date on which the repurchases of Units by the Manager pursuant to the Unit Buy-Back Mandate are carried out to the full extent mandated,

(the "Mandate Duration").

Under the Trust Deed and the prevailing laws and regulations of Singapore, subject to any waiver by the relevant authorities, CICT is required to convene an annual general meeting of Unitholders once every calendar year and not more than 15 months after the holding of the last preceding annual general meeting, and in any case within four months from the financial year end of CICT.

The authority conferred on the Manager under the Unit Buy-Back Mandate to repurchase Units may be renewed at the next annual general meeting of Unitholders. When seeking the approval of Unitholders for any subsequent Unit buy-back mandate, the Manager shall disclose details of each Unit buy-back made during the Mandate Duration in respect of the Unit buy-back mandate immediately preceding such Unit buy-back mandate being sought, including the total number of Units repurchased, the repurchase price per Unit or the highest and lowest prices paid for such repurchases of Units, where relevant, and the total consideration paid for such repurchases.

2.2.3 Manner of Repurchase

Repurchases of Units may be made by way of:

1. market repurchase(s) ("Market Repurchases"); and/or
2. off-marketrepurchase(s) ("Off-MarketRepurchases").

Market Repurchases refer to repurchases of Units by the Manager effected on the SGX-ST and/ or, as the case may be, such other stock exchange for the time being on which the Units may be listed and quoted, through one or more duly licensed stockbrokers appointed by the Manager for the purpose.

Off-Market Repurchases refer to repurchases of Units by the Manager (which are not Market Repurchases) made under an equal access scheme or schemes for the repurchase of Units from Unitholders in accordance with the Trust Deed. In this regard, an Off-Market Repurchase must satisfy all the following conditions:

1. offers for the repurchase or acquisition of Units shall be made to every person who holds Units to repurchase or acquire the same percentage of their Units;
2. all of the above-mentioned persons shall be given a reasonable opportunity to accept the offers made to them; and

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Letter to Unitholders Dated 22 March 2022

1. the terms of all the offers shall be the same, except that there shall be disregarded:
2. 1. differences in consideration attributable to the fact that offers may relate to Units with different accrued distribution entitlements;
   2. differences in consideration attributable to the fact that the offers may relate to Units with different amounts remaining unpaid; and
   3. differences in the offers introduced solely to ensure that each Unitholder is left with a whole number of Units.

Additionally, the Listing Manual provides that, in making an Off-Market Repurchase, the Manager must issue an offer document to all Unitholders which must contain, inter alia:

1. the terms and conditions of the offer;
2. the period and procedures for acceptances;
3. the reasons for the proposed Unit repurchases;
4. the consequences, if any, of Unit repurchases by the Manager that will arise under the Singapore Code on Take-overs and Mergers (the "Code") or other applicable takeover rules;
5. whether the Unit repurchases, if made, could affect the listing of the Units on the SGX-ST;
6. details of any Unit repurchases made by the Manager in the previous 12 months (whether Market Repurchases or Off-Market Repurchases in accordance with an equal access scheme), giving the total number of Units repurchased, the repurchase price per Unit or the highest and lowest prices paid for the repurchases, where relevant, and the total consideration paid for the repurchases; and
7. whether the Units repurchased by the Manager will be cancelled or kept as treasury Units.

2.2.4 Repurchase Price

The Manager has the discretion to determine the repurchase price for a repurchase of Units under a unit buy-back mandate, subject to such repurchase price not exceeding 105.0% of the Average Closing Price (as defined herein) of the Units (the "Maximum Price") for both a Market Repurchase and an Off-Market Repurchase, excluding Related Expenses of such repurchase.

For the purposes of this paragraph 2.2.4:

"Average Closing Price" means the average of the closing market prices of the Units over the last five Market Days (as defined herein), on which transactions in the Units were recorded, immediately preceding the date of the Market Repurchase or, as the case may be, the date of the making of the offer pursuant to the Off-Market Repurchase, and deemed to be adjusted for any corporate action that occurs during the relevant five Market Days and the date on which the Market Repurchase(s) or, as the case may be, the date of the making of the offer pursuant to the Off-Market Repurchase(s);

"date of the making of the offer" means the date on which the Manager makes an offer for an Off-Market Repurchase, stating therein the repurchase price (which shall not be more than the Maximum Price for an Off-Market Repurchase calculated on the foregoing basis) for each Unit and the relevant terms of the equal access scheme for effecting the Off-Market Repurchase.

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Letter to Unitholders Dated 22 March 2022

1. Status of Repurchased Units
   Under the Trust Deed, a Unit repurchased by way of a Unit buy-back shall be deemed cancelled immediately on repurchase (and all rights and privileges attached to such Unit will expire on such cancellation).
2. Reporting Requirements
   Rule 886 of the Listing Manual specifies that an issuer shall notify the SGX-ST of all repurchases or acquisitions of its Units not later than 9.00 a.m.:
3. 1. in the case of a Market Repurchase, on the Market Day following the day on which the Market Repurchase was made; or
   2. in the case of an Off-Market Repurchase under an equal access scheme, on the second Market Day after the close of acceptance of the offer for the Off-Market Repurchase.

The notification of any such repurchases of Units to the SGX-ST (in the form of an announcement on the SGXNet) shall be in such form and shall include such details as the SGX-ST may prescribe.

The Manager shall make arrangements with the appointed stockbrokers and/or custodians to ensure that they provide the Manager in a timely fashion the necessary information which will enable the Manager to make the notifications to the SGX-ST.

1. Sources of Funds
   The Manager may only apply funds for the repurchase of Units as provided in the Trust Deed and in accordance with the applicable laws and regulations in Singapore. The Manager may not repurchase Units for a consideration other than in cash.
   The Manager intends to utilise CICT's internal sources of funds, external borrowings or a combination of both to finance the Manager's repurchase of Units on behalf of CICT pursuant to the Unit Buy-Back Mandate, subject always to the requirements of the applicable laws and/or regulations in force at the relevant time.
2. Financial Effects
   It is not possible for the Manager to calculate realistically or quantify the impact of repurchases of Units that may be made pursuant to the Unit Buy-Back Mandate on the NAV per Unit and distribution per Unit ("DPU") as the resultant effect would depend on, among others, the aggregate number of Units repurchased and the repurchase prices paid for such Units.
   CICT's total number of issued Units will be diminished by the total number of Units repurchased by way of a Unit Buy-Back as such Units will be cancelled.
   The Manager will only exercise the Unit Buy-Back Mandate when it considers it to be in the best interests of CICT and the Unitholders. The Manager will consider factors such as the working capital requirements, availability of financial resources, the investment and growth strategies of CICT and the prevailing market conditions before repurchasing Units under the Unit Buy-Back Mandate. The Manager will exercise the Unit Buy-Back Mandate with a view to enhancing the DPU and/or the NAV per Unit. The Manager does not intend to exercise the Unit Buy-Back Mandate to such an extent as would have a material adverse effect on the financial position of CICT.

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