Dar Al Takaful : Notification regarding Merger between Dar Al Takaful PJSC and National Takaful Company (Watania) PJSC

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to the action you should take, it is recommended that you seek your own (i) independent financial advice from a financial advisor licensed by SCA and (ii) independent legal advice from your lawyer or other appropriate independent legal advisor.

If you have sold or otherwise transferred all of your DAT Shares or Watania Shares, please send this document as soon as possible to the stockbroker, bank or other agent through whom the sale or transfer was effected for delivery to the purchaser or transferee. However, this document should not be forwarded or transmitted in or into or to any Restricted Jurisdiction. If you have sold or transferred only part of your holding of DAT Shares or Watania Shares, you should retain this document and consult the stockbroker, bank or other agent through whom the sale or transfer was effected.

This document is not being published or distributed, and should not be forwarded or transmitted, in or into or to any Restricted Jurisdiction. Implementation of the Merger is conditional upon, amongst other things, each of the resolutions set out in the notice of the DAT GM (set out in Schedule 2) receiving a vote in favour by holders of the requisite majority of DAT Shares represented at the DAT GM and each of the resolutions set out in the notice of the Watania GM (set out in Schedule 3) receiving a vote in favour by holders of the requisite majority of Watania Shares represented at the Watania GM. The conditions to, and process for, implementing the Merger are set out in full in paragraph 15 of this document.

Shareholder Circular in respect of the merger of Dar Al Takaful PJSC and National Takaful Company (Watania) PJSC by way of a merger pursuant to Article 285(1) of the UAE Federal Decree Law No. 32 of 2021 concerning Commercial Companies

For a discussion of certain risk factors which should be taken into account when considering whether to vote in favour of the resolutions to be considered at the DAT GM and the Watania GM, see paragraph 13 of this document.

Unless the context requires otherwise, capitalised terms used in this document have the meanings given in Schedule 1 of this document. References to times and dates in this document are to United Arab Emirates time and the Gregorian calendar, respectively, unless otherwise stated.

Notices of the DAT GM, to be held electronically/from distance at 1 P.M. on Monday 25 April 2022 , and the Watania GM, to be held electronically/from distance at 11 A.M. on Monday 25 April 2022 , are set out in Schedule 2 and Schedule 3, respectively.

CONTENTS

• 1. IMPORTANT NOTICE ............................................................................................................................. 3

• 2. CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS ................................. 5

• 3. PUBLICATION AND DISTRIBUTION RESTRICTIONS ..................................................................... 6

• 4. NOTICE TO WATANIA SHAREHOLDERS IN NON-UAE JURISDICTIONS .................................. 6

• 5. PRESENTATION OF FINANCIAL AND OTHER INFORMATION .................................................... 6

• 6. EXPECTED TIMETABLE OF PRINCIPAL EVENTS .......................................................................... 7

• 7. JOINT LETTER FROM THE CHAIRMEN OF DAT AND Watania .................................................... 8

• 8. GENERAL INFORMATION ..................................................................................................................... 9

• 9. INFORMATION ABOUT THE COMBINED GROUP ......................................................................... 16

• 10. INFORMATION ABOUT DAT ............................................................................................................... 18

• 11. INFORMATION ABOUT WATANIA ..................................................................................................... 24

• 12. HISTORICAL FINANCIAL INFORMATION ........................................................................................ 29

• 13. RISK FACTORS ..................................................................................................................................... 31

• 14. ADDITIONAL INFORMATION .............................................................................................................. 35

• 15. TERMS AND CONDITIONS OF THE MERGER ............................................................................... 38

Schedule 1 DEFINITIONS .................................................................................................................... 41

Schedule 2 DAT NOTICE OF GENERAL ASSEMBLY MEETING ....................................................... 44

Schedule 3 WATANIA NOTICE OF GENERAL ASSEMBLY MEETING .............................................. 48

Schedule 4 SUMMARY OF INDEPENDENT VALUATION REPORT .................................................. 51

Schedule 5 AMENDED ARTICLES OF ASSOCIATION ....................................................................... 52

Schedule 6 ACKNOWLEDGEMENT AND UNDERTAKINGS OF ADVISORS ........................................ 54

IMPORTANT NOTICE

Statements contained in this document are made as at the date of this document, unless some other time is specified in relation to them, and the publication of this document (or any action taken pursuant to it) shall not give rise to any implication that there has been no change in the facts or affairs of DAT or Watania as set out in this document since such date. Nothing contained in this document is intended to be or shall be deemed to be a forecast, projection or estimate of the future financial performance of DAT or Watania and no statement in this document should be interpreted to mean that earnings per share for current or future financial periods of DAT or Watania will necessarily match or exceed historical published earnings per share.

No person has been authorised to give any information or to make any representations other than those expressly contained in this document and, if given or made, such information or representations must not be relied on as having been authorised by DAT, Watania, EMCAP, KPMG, Milliman or any of the other advisers in connection with the Merger.

No person should construe the contents of this document as legal, financial or tax advice. If you are in any doubt as to the action you should take, it is recommended that you seek your own independent financial advice from your stockbroker, accountant or other appropriate independent financial adviser.

Copies of this document can be obtained (without charge) from the head offices of each of DAT (in the case of DAT Shareholders) and Watania (in the case of Watania Shareholders), at the DAT GM and the Watania GM and from each of DAT's or Watania's websites athttps://dat.ae/ andhttps://www.watania.ae/,respectively. Except in respect of the foregoing and DAT's and Watania's financial statements for the financial years ended 31 December 2018, 31 December 2019 and 31 December 2020 and the unaudited interim consolidated financial statements for the period ending 30 September 2021, neither the content of any website of DAT or Watania nor the content of any website accessible from hyperlinks on any of such websites is incorporated into, or forms part of, this document and no person accepts any responsibility for the contents of such websites.

The directors of DAT, whose names are set out in paragraph 10.5 of this document, accept responsibility for the information contained in this document other than that relating to Watania. To the best of the knowledge and belief of these directors (who have taken all reasonable care to ensure that such is the case), the information contained in this document for which they are responsible is in accordance with the facts and does not omit anything likely to affect the import of such information.

The directors of Watania, whose names are set out in paragraph 11.5 of this document, accept responsibility for the information contained in this document other than that relating to DAT. To the best of the knowledge and belief of these directors (who have taken all reasonable care to ensure that such is the case), the information contained in this document for which they are responsible is in accordance with the facts and does not omit anything likely to affect the import of such information.

IBRAHIM & PARTNERS (InP) are acting exclusively as legal adviser to DAT and for no one else in connection with the Merger and will not be responsible to anyone other than DAT for providing the protections afforded to clients of InP nor for providing advice in relation to the Merger, the content of this document or any other matter referred to in this document.

Hadef & Partners (Hadef) are acting exclusively as legal adviser to Watania and for no one else in connection with the Merger and will not be responsible to anyone other than Watania for providing the protections afforded to clients of Hadef nor for providing advice in relation to the Merger, the content of this document or any other matter referred to in this document.

Emirates NBD Capital Limited (EMCAP), which is registered in the Dubai International Financial Centre and regulated by the Dubai Financial Services Authority, is acting as the financial advisor to both DAT and Watania to carry out the services of managing and organizing the Merger transaction and assist in preparing the stepplans for each of DAT and Watania and advise the merger committee to facilitate the completion of the Merger.

KPMG Lower Gulf Limited, which is registered in Abu Dhabi and regulated by the Abu Dhabi Department of Economic Development is acting as the independent valuer as approved by SCA, to both DAT and Watania. KPMG is also acting as the financial, VAT and IT due diligence advisor to both DAT and Watania.

Milliman, LLC. (Milliman), which is registered in the Dubai International Financial Centre and Regulated by the Dubai Financial Services Authority and also a registered actuary with the UAE Central Bank, is acting as actuarial diligence advisor to both DAT and Watania.

The formal shareholder circular is published in the Arabic language. No reliance should be placed on this English translation, which may not entirely reflect the official Arabic language shareholder circular.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This document contains certain forward-looking statements with respect to DAT and Watania. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements often use words such as "anticipate", "target", "expect", "estimate", "intend", "plan", "will", "goal", "believe", "aim", "may", "would", "could" or "should" or other words of similar meaning or the negative thereof. Forward-looking statements in this document include, without limitation, statements relating to the following: (i) future capital expenditures, expenses, revenues, economic performance, financial conditions, dividend policy, losses and future prospects; and (ii) business and management strategies and the expansion and growth of the operations of the Combined Group.

These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of any such person, industry results, strategies or events, to be materially different from any results, performance, achievements or other events or factors expressed or implied by such forward-looking statements. Many of the risks and uncertainties relating to forward-looking statements are beyond the Companies' abilities to control or estimate precisely, such as future market conditions and the behaviour of other market participants, and therefore undue reliance should not be placed on such statements. Forward-looking statements are not guarantees of future performance. They have not, unless otherwise indicated, been reviewed by the auditors of DAT or Watania. Forward-looking statements are based on numerous assumptions, including assumptions regarding the present and future business strategies of DAT and Watania and the environment in which each will operate in the future. All subsequent oral or written forward-looking statements made by or attributable to DAT or Watania or any persons acting on their behalf are expressly qualified in their entirety by the cautionary statement above.

From December 2019 onwards, an outbreak of novel coronavirus ("COVID-19"), a viral respiratory illness, has spread globally, including the UAE. The COVID-19 outbreak poses potential risks and material uncertainty to the Companies' businesses, results of operations, financial condition and prospects. For more details, see paragraph 13 of this document. This document and the statements herein should be read in light of the ongoing COVID-19 pandemic and its continuing and unprecedented impact on the global economy and market conditions.

The overarching risks and uncertainties of such forward-looking statements include, but are not limited to:

• • the global economic recession and financial crisis due to the ongoing global COVID-19 pandemic;

• • the economic and financial markets conditions in the UAE generally and in particular;

• • the Companies' relationship with the Government generally, including their ability to obtain requisite governmental or regulatory approvals and permits;

• • the Companies' ability to achieve and manage the growth of their businesses;

• • the Companies' ability to obtain financing or maintain sufficient capital to fund their existing and future operations;

• • changes in political, social, legal or economic conditions in the markets in which the Companies and their customers operate;

• • changes in the competitive environment in which the Companies operate; and

• • failure to comply with regulations applicable to the Companies' businesses.

DAT and Watania assume no obligation to, and do not intend to, update any forward-looking statements, except as required pursuant to applicable law and regulation.