PERDUREN (M) BERHAD (‘‘PERDUREN” OR THE …enra.listedcompany.com/newsroom/Perduren_-Announcement-(8_Dec_2014...PERDUREN (M) BERHAD (‘‘PERDUREN” OR THE ‘‘COMPANY”)

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PERDUREN (M) BERHAD (‘‘PERDUREN” OR THE ‘‘COMPANY”) PROPOSED DISPOSAL OF: (I) THE ENTIRE EQUITY INTEREST IN ADVANTAGE EQUITY SDN BHD;

(II) THE ENTIRE EQUITY INTEREST IN BALANCE FOCUS SDN BHD; (III) THE ENTIRE EQUITY INTEREST IN GRAND SENTOSA HOTEL MANAGEMENT SERVICES SDN

BHD; AND (IV) 30% EQUITY INTEREST IN LANDMARK ZONE SDN BHD

(COLLECTIVELY, THE “PROPOSED DISPOSALS”)

1. INTRODUCTION

1.1 On behalf of the Board of Directors of Perduren (“Board”), Hong Leong Investment Bank Berhad

(“HLIB”) wishes to announce that the Company had on 8 December 2014 entered into the following agreements: (i) a conditional Share Sale Agreement with Jerusan Indah Sdn Bhd (“JISB”) (“SSA-A”) for the

proposed disposal by Perduren of 100,000,000 ordinary shares of RM1.00 each, representing the entire issued and paid-up share capital of Advantage Equity Sdn Bhd (“AESB”) for a cash consideration of RM71,800,000 (“Proposed Disposal of AESB”);

(ii) a conditional Share Sale Agreement with JISB (“SSA-B”) for the proposed disposal by Perduren of 2 ordinary shares of RM1.00 each, representing the entire issued and paid-up share capital of Balance Focus Sdn Bhd (“BFSB”) for a cash consideration of RM1,300,000 (“Proposed Disposal of BFSB”);

(iii) a conditional Share Sale Agreement with JISB (“SSA-C”) for the proposed disposal by Perduren of 2,200,000 ordinary shares of RM1.00 each, representing the entire issued and paid-up share capital of Grand Sentosa Hotel Management Services Sdn Bhd (formerly known as Christine Inn & Recreation Sdn Bhd) (“GSHSB”) for a cash consideration of RM100,000 (“Proposed Disposal of GSHSB”); and

(iv) a conditional Share Sale Agreement with Meridian Hectares Sdn Bhd (“MHSB”) (“SSA-D”)

for the proposed disposal by Perduren of 2,400,000 ordinary shares of RM1.00 each, representing 30% of the issued and paid-up share capital of Landmark Zone Sdn Bhd (“LZSB”) for a cash consideration of RM8,300,000 (“Proposed Disposal 2”).

JISB and MHSB are hereinafter collectively referred to as the “Purchasers”. AESB, BFSB, GSHSB and LZSB are hereinafter collectively referred to as the “Subject Companies”. SSA-A, SSA-B, SSA-C and SSA-D are hereinafter collectively referred to as the “SSAs”. The Proposed Disposal of AESB, Proposed Disposal of BFSB and Proposed Disposal of GSHSB are hereinafter collectively referred to as the “Proposed Disposal 1”.

1.2 On even date, the Board has received a notice of unconditional mandatory take-over offer (“Notice”) from Dato’ Kamaluddin bin Abdullah and Dato’ Mazlin bin Md Junid (“Joint Offerors”) through M&A Securities Sdn Bhd to acquire all the remaining ordinary shares of RM1.00 each in Perduren (excluding treasury shares) (“Offer Shares”) not already held by the Joint Offerors and persons acting in concert with the Joint Offerors for a cash offer price of RM1.60 per Offer Share. For further information, please refer to the announcement made by Perduren today in relation to the receipt of the Notice.

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2. PROPOSED DISPOSALS

2.1 Salient terms of the SSAs The salient terms of the SSAs are set out in Appendix I of this announcement.

2.2 Basis and justification of arriving at the disposal consideration (i) Proposed Disposal of AESB

The disposal consideration of RM71,800,000 was arrived at on a “willing-buyer willing-seller” basis after taking into consideration the following: (a) the unaudited net assets (“NA”) of AESB as at 30 September 2014 of approximately

RM69,870,000; and

(b) the revaluation deficit of RM14,000,000 after taking into account:

(aa) the net book value of the investment property held by AESB, namely a commercial complex known as Plaza Sentosa held under Lot No. 11592, Title No. Geran 27812, Mukim of Plentong, District of Johor Bahru and State of Johor (“Plaza Sentosa”) of RM159,000,000 based on the unaudited financial statements of AESB as at 30 September 2014; and

(bb) the estimated market value of Plaza Sentosa of RM145,000,000 as

appraised by an independent firm of valuers, Henry Butcher Malaysia (Johor) Sdn Bhd (“HB Johor”), via its valuation letter dated 28 November 2014 using the investment and comparison methods of valuation.

For illustrative purposes, the realisable NA value of AESB, after adjusting for the revaluation deficit, is as follows:

RM’000 Unaudited NA of AESB as at 30 September 2014 69,870 Less: Revaluation deficit (14,000)

Realisable NA value of AESB 55,870

The disposal consideration of RM71,800,000 represents: (a) a premium of approximately RM1,930,000 or 2.8% over the unaudited NA of AESB

as at 30 September 2014 of approximately RM69,870,000; and (b) a premium of approximately RM15,930,000 or 28.5% over the realisable NA value of

AESB of approximately RM55,870,000. Further information on AESB and Plaza Sentosa is set out in Section 3.1 below.

(ii) Proposed Disposal of BFSB

The disposal consideration of RM1,300,000 was arrived at on a “willing-buyer willing-seller” basis after taking into consideration the unaudited NA of BFSB as at 30 September 2014 of approximately RM1,223,000, resulting in a premium of approximately RM77,000 or 6.3%.

Further information on BFSB is set out in Section 3.2 below.

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(iii) Proposed Disposal of GSHSB The disposal consideration of RM100,000 was arrived at on a “willing-buyer willing-seller” basis after taking into consideration the following: (a) the unaudited net liabilities (“NL”) of GSHSB as at 30 September 2014 of

approximately RM697,000; and (b) losses incurred by GSHSB for the past 3 financial years ended 31 March 2012 to 31

March 2014. The disposal consideration of RM100,000 represents a premium of approximately RM797,000 or 114.3% over the unaudited NL of GSHSB as at 30 September 2014 of approximately RM697,000. Further information on GSHSB is set out in Section 3.3 below.

(iv) Proposed Disposal 2 The disposal consideration of RM8,300,000 was arrived at on a “willing-buyer willing-seller” basis after taking into consideration the following: (a) the unaudited NA of LZSB as at 30 September 2014 of approximately

RM12,975,000; and

(b) the realisable NA value of LZSB of approximately RM27,525,000 based on the estimated market value of the development rights for a joint venture property development project of LZSB identified as “Shamelin Star” sited on PT 2646 and held under H.S.(D) 119169, Mukim of Ampang, District of Kuala Lumpur, State of Wilayah Persekutuan Kuala Lumpur of RM19,400,000 as appraised by an independent firm of valuers, Henry Butcher Malaysia Sdn Bhd (“HB KL”) via its valuation letter dated 28 November 2014 using the residual method of valuation.

For illustrative purposes, the realisable NA value of LZSB, after adjusting for the revaluation surplus, is as follows: RM’000 Unaudited NA of LZSB as at 30 September 2014 12,975 Add: Residual value of Shamelin Star 19,400 Less: Deferred tax (4,850)

Realisable NA value of LZSB 27,525

30% thereon 8,258

The disposal consideration of RM8,300,000 represents: (a) a premium of approximately RM4,407,500 or 113.2% over 30% of the unaudited NA

of LZSB as at 30 September 2014 of approximately RM3,892,500; and (b) a premium of approximately RM42,000 or 0.5% over 30% of the realisable NA value

of LZSB of approximately RM8,258,000. Further information on LZSB and Shamelin Star is set out in Section 3.4 below.

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2.3 Original cost and date of investment The original cost of investment in the Subject Companies by Perduren and the date of investment are as follows: Company Date of investment No. of shares Cost of investment RM AESB 19 July 2007 100,000,000 94,709,627 BFSB 3 June 2009 2 2 GSHSB 2 August 2010 440,000 300,000 25 October 2011 1,760,000 1,760,000

2,200,000 2,060,000

LZSB 3 June 2009 2 2 25 February 2011 249,998 249,998 18 April 2013 7,750,000 7,750,000

8,000,000 8,000,000

2.4 Liabilities to be assumed

There are no other liabilities, including contingent liabilities and guarantees, to be assumed by the Purchasers pursuant to the Proposed Disposals.

3. INFORMATION ON THE SUBJECT COMPANIES

3.1 Information on AESB AESB was incorporated in Malaysia under the Companies Act, 1965 (the “Act”) on 1 October 1994 as a private limited company. AESB is a wholly-owned subsidiary of Perduren. As at 27 November 2014, being the latest practicable date prior to this announcement (“LPD”), the authorised share capital of AESB is RM100,000,000 comprising 100,000,000 ordinary shares of RM1.00 each, all of which have been issued and paid-up. AESB is principally a property investment company, holding investment property known as Plaza Sentosa located in Johor Bahru. As at the LPD, AESB does not have any subsidiary or associated company. The Directors of AESB are Dato’ Ong Chong Sek, Law Wai Cheong and Tong Lee Hiong. Information on Plaza Sentosa is as follows:

Description : 9 separate blocks of 5 and 6 storey buildings interlinked by walkways and with a block of 8 storey retail mall-cum multi-storey car parks

Postal address or identification

:

Title particulars

Lot No. 11592, Geran 27812, Mukim of Plentong, District of Johor Bahru and State of Johor Postal address

Plaza Sentosa, Jalan Sutera, Taman Sentosa, 80150 Johor Bahru, Johor

Type/ Existing use : Commercial and office space

Rental income : RM14,460,781 per annum as at 31 October 2014

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Title land area : 336,501 square feet

Original cost and date of investment

: Acquired by AESB on 25 February 2004 for RM155,000,000

Approximate age of building

: 30 years

Tenure : Freehold

Net lettable area : 710,305 square feet

Occupancy rate : 82.4% as at the LPD

Market value : RM145,000,000 as appraised by HB Johor via its valuation letter dated 28 November 2014 based on the investment and comparison methods of valuation

Audited net book value

: RM159,000,000 (as at 31 March 2014)

Encumbrances : Charged to Hong Leong Bank Berhad

The historical financial information of AESB is set out in Appendix II of this announcement.

3.2 Information on BFSB BFSB was incorporated in Malaysia under the Act on 5 March 2009 as a private limited company. BFSB is a wholly-owned subsidiary of Perduren. As at the LPD, the authorised share capital of BFSB is RM100,000 comprising 100,000 ordinary shares of RM1.00 each, of which RM2 comprising 2 ordinary shares of RM1.00 each have been issued and paid-up. BFSB is principally involved in car park operation. BFSB is an in-house car park operator for Plaza Sentosa and Holiday Plaza with two separate car park tenancy agreements which are expiring on 30 September 2016. As at the LPD, BFSB does not have any subsidiary or associated company. The Directors of BFSB are Dato’ Ong Chong Sek, Law Wai Cheong and Tong Lee Hiong.

The historical financial information of BFSB is set out in Appendix II of this announcement.

3.3 Information on GSHSB GSHSB was incorporated in Malaysia under the Act on 22 January 1981 as a private limited company under the name of Prodev Sdn Bhd. The company changed its name to Christine City Entertainment Sdn Bhd on 30 March 1994 and thereafter changed its name again to Christine Auto Sdn Bhd, Christine Recreation Sdn Bhd and Christine Inn & Recreation Sdn Bhd on 25 January 2000, 24 April 2002 and 16 July 2002 respectively. The company assumed its present name on 7 July 2014. GSHSB is a wholly-owned subsidiary of Perduren. As at the LPD, the authorised share capital of GSHSB is RM5,000,000 comprising 5,000,000 ordinary shares of RM1.00 each, of which RM2,200,000 comprising 2,200,000 ordinary shares of RM1.00 each have been issued and paid-up. GSHSB is principally involved in the operation of an inn and recreation centre. GSHSB leases and operates a 3-star hotel within Plaza Sentosa. The tenancy agreement is expiring on 31 March 2015. As at the LPD, GSHSB does not have any subsidiary or associated company. The Directors of GSHSB are Dato’ Ong Chong Sek, Law Wai Cheong and Tong Lee Hiong.

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The historical financial information of GSHSB is set out in Appendix II of this announcement.

3.4 Information on LZSB LZSB was incorporated in Malaysia under the Act on 21 May 2009 as a private limited company. LZSB is a wholly-owned subsidiary of Perduren. As at the LPD, the authorised share capital of LZSB is RM10,000,000 comprising 10,000,000 ordinary shares of RM1.00 each, of which RM8,000,000 comprising 8,000,000 ordinary shares of RM1.00 each have been issued and paid-up. LZSB is principally engaged in property development and is currently undertaking a joint venture property development project known as “Shamelin Star” comprising serviced apartments and retail units located within Taman Shamelin Perkasa in Kuala Lumpur. As at the LPD, LZSB does not have any subsidiary or associated company. The Directors of LZSB are Dato’ Ong Chong Sek, Law Wai Cheong and Tong Lee Hiong.

Information on Shamelin Star is as follows:

Description : Mixed development project

Postal address or identification

:

H.S. (D) 119169, PT 2646, Mukim of Ampang, District of Kuala Lumpur, State of Wilayah Persekutuan Kuala Lumpur

Type/ Existing use : Development in progress

Provision land area : 133,785 square feet

Original cost and date of investment

: LZSB entered into Joint Venture Agreement for the development of Shamelin Star on 28 February 2011. Based on the audited financial statement of LZSB as at 31 March 2014, the total land and development cost amounted to RM109,081,308

Approximate age : Not applicable

Tenure : Leasehold period of 99 years, expiring on 22 May 2111

Market value : RM19,400,000 as appraised by HB KL via its valuation letter dated 28 November 2014 based on residual method of valuation

Encumbrances : Charged to Malaysia Building Society Berhad

Details of the development potential

: 2 blocks of 29 storey serviced apartments totalling 630 units, 30 units of retail lots, car park and a club house

Expected commencement and completion date(s) of development

: Development commenced in July 2013 and is expected to be completed by December 2016

Expected profits to be derived

: Estimated net development profit of approximately RM30,000,000

Stage or percentage of completion

: 24.8%

Sources of funds to finance the development cost

: Borrowings and internally generated funds

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Relevant approvals for the development and date(s) obtained

: (i) Building Plan Approval dated 23 April 2013 (ii) Development Order dated 5 September 2012 (iii) Amended Development Order dated 5 September 2014

The historical financial information of LZSB is set out in Appendix II of this announcement.

4. INFORMATION ON THE PURCHASERS

4.1 Information on JISB JISB was incorporated in Malaysia under the Act on 23 February 1995 as a private limited company under its present name. JISB is an investment holding company and is principally engaged in the letting of properties. As at the LPD, the authorised share capital of JISB is RM500,000 comprising 500,000 ordinary shares of RM1.00 each, of which RM450,000 comprising 450,000 ordinary shares of RM1.00 each have been issued and paid-up. As at the LPD, the Directors and shareholders and their respective shareholdings in JISB are as follows:

Name Nationality <------------ Direct ----------> <--------- Indirect -------->

No. of shares % No. of shares %

Tan Sri Dato’ Law Tien Seng Malaysian 225,000 50.0 - -

Puan Sri Datin Saw Geok Ngor

Malaysian 225,000 50.0 - -

4.2 Information on MHSB

MHSB was incorporated in Malaysia under the Act on 11 February 2010 as a private limited company under its present name. MHSB has not commenced any business as at the date of this announcement. As at the LPD, the authorised share capital of MHSB is RM100,000 comprising 100,000 ordinary shares of RM1.00 each, of which RM2 comprising 2 ordinary shares of RM1.00 each have been issued and paid-up. As at the LPD, the Directors and their respective shareholdings in MHSB are as follows:



Loh Chen Yook Malaysian 1 50.0 - -

Wong Kok Leong Malaysian - - - -

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As at the LPD, the substantial shareholders and their respective shareholdings in MHSB are as follows:



Loh Chen Yook Malaysian 1 50.0 - -

Low Suan Choo Malaysian 1 50.0 - -

5. RATIONALE FOR THE PROPOSED DISPOSALS The Proposed Disposals present an opportunity for Perduren and its subsidiaries (“the Group”) to monetise its assets at a premium over their book values in line with the Group’s objectives in property investment and property development. Pursuant to the Proposed Disposals, the Group will realise a one-off net gain on disposal of approximately RM9,511,000 to the Group after deducting the estimated expenses of approximately RM1,100,000 incidental to the Proposed Disposals. Although the Proposed Disposals will result in the Group divesting its current business operations in property investment, car park operations and operation of inn and recreation, the Proposed Disposals are not expected to have any material effect on the Group’s remaining business operations in property development. The Proposed Disposals will strengthen the Group’s liquidity and cash positions and provide the Group with added financial flexibility to seize investment opportunities as and when they arise. The Proposed Disposal 2 will enable the Group to retain and leverage Mr Loh Chen Yook’s expertise and experience in the property development industry. Mr Loh, a Non-Independent Non-Executive Director-cum-Group Advisor of Perduren, was the Managing Director of the Company from year 2007 to year 2014 and has over 30 years of experience in property development, infrastructure, building construction as well as timber logging business.

6. UTILISATION OF PROCEEDS The total proceeds from the Proposed Disposals of RM81,500,000 are expected to be utilised as follows:

Purposes Note RM’000

Timeframe for the utilisation of proceeds from completion of the Proposed Disposals

Investment in property development, property investment and/ or investments in other sectors

(i) 60,000 Within 2 years

Working capital (ii) 20,400 Within 2 years

Defraying expenses incidental to the Proposed Disposals

(iii) 1,100 Within 2 months

Total 81,500

Notes: (i) The Company intends to continue evaluating investment opportunities in the property related

sector. However, as at the date of this announcement, the Company has yet to identify any new investment opportunity. Nevertheless, if attractive investment opportunities arise in other sectors, the Company will not disregard evaluating such opportunities.

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Appropriate announcement(s) will be made in accordance with the Main Market Listing Requirements of Bursa Malaysia Securities Berhad (“Listing Requirements”) in respect of any investment activities that may be proposed by the Company. In the event shareholders’ approval is required pursuant to the Listing Requirements for the proposed investment, such approval will be sought.

(ii) The working capital requirements for the Group are mainly day-to-day operations to support the Group’s business operations which shall include, but are not limited to, the payment of trade and other payables, salaries, professional fees, business development expenses in the ordinary course of business (such as feasibility studies on investment opportunities and valuation exercises) and marketing expenses. The breakdown of proceeds to be utilised for each component of working capital has not been determined at this juncture. Further, the actual amount to be utilised by each component of working capital may differ subject to the operating requirements at the time of utilisation.

(iii) Expenses in relation to the Proposed Disposals comprise, among others, professional fees

for advisers and lawyers, fees payable to the authorities, expenses to convene the extraordinary general meeting (“EGM”) and printing, despatch and advertising expenses. Any difference in the actual amount utilised for defraying the estimated expenses relating to the Proposed Disposals would be adjusted to/ from the proceeds allocated for working capital purposes.

Pending the utilisation of the proceeds by the Group, the proceeds will be placed in interest-bearing deposit accounts with financial institutions or short-term money market instrument(s) as the Board may deem fit.

7. RISK FACTORS

The risk factors of the Proposed Disposals include, among others, the following: (i) Failure/ Delay in the completion of the Proposed Disposals

The completion of the Proposed Disposals is conditional upon the conditions precedent being satisfied in accordance with the provisions of the SSAs. There is no assurance that all such conditions precedent will be satisfied. Notwithstanding this, the Board will take reasonable steps to ensure that the conditions precedent are met in order to complete the Proposed Disposals in a timely manner.

(ii) Loss of potential future income from the Subject Companies

For the financial year ended 31 March 2014, AESB, BFSB and GSHSB collectively contributed approximately 35.7% to the Group’s audited revenue. Upon the completion of the Proposed Disposals, AESB, BFSB and GSHSB will cease to contribute to the future revenue and profit of the Group. The Group will, however, continue to be involved in property development via its remaining 70% equity interest in LZSB, which contributed approximately RM34,819,000 in revenue and approximately RM2,963,000 in pre-tax profit to the Group, representing 52.5% and 29.1% of the Group’s revenue and pre-tax profit for the financial year ended 31 March 2014 respectively.

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8. EFFECTS OF THE PROPOSED DISPOSALS

8.1 Share capital and substantial shareholders’ shareholding The Proposed Disposals will not have any effect on the share capital and substantial shareholders’ shareholdings of Perduren as the Proposed Disposals do not involve any issuance of new shares in the Company.

8.2 Earnings and earnings per share (“EPS”)

Upon completion of the Proposed Disposals, the Group is expected to realise a net gain on disposals of approximately RM9,511,000 based on the latest audited financial statements of the Group for the financial year ended 31 March 2014, assuming that the Proposed Disposals had been effected on 31 March 2014 and after deducting estimated expenses of approximately RM1,100,000 incidental to the Proposed Disposals. The net gain attributable to owners of the Company represents an EPS of approximately RM0.03*. AESB, BFSB and GSHSB, which collectively contributed approximately 35.7% to the Group’s audited revenue for the financial year ended 31 March 2014, will cease to contribute to the future revenue and profit of the Group upon completion of the Proposed Disposals. Note: * The Proposed Disposal 2 does not result in the Group losing control over LZSB and it represents a

transaction between owners as defined under the Financial Reporting Standards 10 Consolidated Financial Statements. Hence, the computation of EPS has excluded the estimated gain on disposal of approximately RM5,321,000 arising from the Proposed Disposal 2.

8.3 NA per share and gearing

Based on the latest audited consolidated financial statements of the Company as at 31 March 2014, the proforma effects of the Proposed Disposals on the Company’s NA per share and gearing are set out as follows:

Audited as at 31 March

2014

After the Proposed

Disposal 1

After the Proposed

Disposal 2

After the Proposed Disposals

RM’000 RM’000 RM’000 RM’000

Share capital 136,208 136,208 136,208 136,208

Share premium 8,536 8,536 8,536 8,536

Treasury shares (1,199) (1,199) (1,199) (1,199)

Capital reserve 275 275 275 275

Retained earnings 70,977 (1) (4)

75,167 (2) (4)

75,198 (3) (4)

80,488

Shareholders’ equity/ NA attributable to equity holders

214,797 218,987 219,018 224,308

Number of ordinary shares of RM1.00 each in Perduren (“Perduren Shares”) (‘000)

134,919 134,919 134,919 134,919

NA per Perduren Share (RM) 1.59 1.62 1.62 1.66

Total borrowings (RM’000) 145,878 87,138 145,878 87,138

Gearing (times) 0.68 0.40 0.67 0.39

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Notes: (1) After taking into consideration the estimated gain on disposal of approximately RM5,290,000 arising from

the Proposed Disposal 1. (2) After taking into consideration the estimated gain on disposal of approximately RM5,321,000 arising from

the Proposed Disposal 2. (3) After taking into consideration the estimated gain on disposal of approximately RM10,611,000 arising from

the Proposed Disposals. (4) After taking into consideration the estimated expenses of approximately RM1,100,000 in relation to the

Proposed Disposals.

9. APPROVALS REQUIRED The Proposed Disposals are conditional upon the following approvals being obtained: (i) the shareholders of Perduren at an EGM to be convened;

(ii) the shareholders of JISB for the acquisition of AESB, BFSB and GSHSB; (iii) the shareholders of MHSB for the acquisition of LZSB;

(iv) the consent or approval of the banks, financiers and creditors of the Subject Companies

and/or Perduren; and

(v) any other relevant authorities and/ or parties, if required. The Proposed Disposal 1 is inter-conditional upon one another. The Proposed Disposal 1 is not inter-conditional upon the Proposed Disposal 2. The Proposed Disposals are not conditional upon any other proposal of the Company.

10. INTERESTS OF DIRECTORS, MAJOR SHAREHOLDERS AND/ OR CONNECTED PERSONS Save as disclosed below, none of the other Directors and/ or major shareholders of the Company and/ or persons connected with them has any interest, direct or indirect, in the Proposed Disposals: Law Wai Cheong, a Director of Perduren, is the son of Tan Sri Dato’ Law Tien Seng (“TSDLTS”) and Puan Sri Datin Saw Geok Ngor (“PSDSGN”). TSDLTS and PSDSGN, the Directors and major shareholders of JISB, are the major shareholders of the Company by virtue of their interests held via TS Law Group Sdn Bhd (“TS Law”). TS Law is a major shareholder of Perduren. Loh Chen Yook, a Director of Perduren, is also a Director and major shareholder of MHSB.

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The Directors and/ or major shareholders of the Company and/ or persons connected with them, who have an interest, direct or indirect, in the Proposed Disposals and their respective shareholdings in Perduren as at the LPD are as follows:

Interested Directors

<------------ Direct ----------> <--------- Indirect -------->

No. of Perduren Shares held %

(1)

No. of Perduren Shares held %

(1)

Law Wai Cheong - - - -

Loh Chen Yook - - - -

Interested Major Shareholders

TS Law 96,363,885 71.42 - -

TSDLTS - - 96,363,885 71.42(2)

PSDSGN - - 96,363,885 71.42(2)

Notes: (1) Excluding 1,289,400 Perduren Shares which are held as treasury shares as at the LPD. (2) Deemed interested by virtue of their interest in TS Law pursuant to Section 6(A)(4) of the Act.

Accordingly, the interested directors of the Company, namely Law Wai Cheong and Loh Chen Yook have abstained and will continue to abstain from all deliberations and voting at the relevant board meetings in relation to the Proposed Disposal 1 and Proposed Disposal 2, respectively. They will also abstain from voting in respect of their direct and/ or indirect shareholdings in Perduren, if any, on the resolutions pertaining to the Proposed Disposal 1 and Proposed Disposal 2, respectively to be tabled at the EGM to be convened. Law Wai Cheong and Loh Chen Yook have also undertaken to ensure persons connected to them will abstain from voting in respect of their direct and indirect shareholdings, if any, on the resolutions pertaining to the Proposed Disposal 1 and Proposed Disposal 2, respectively to be tabled at the EGM to be convened. The interested major shareholders of the Company, namely TS Law, TSDLTS and PSDSGN will abstain from voting in respect of their direct and/ or indirect shareholdings in Perduren on the resolutions pertaining to the Proposed Disposal 1 to be tabled at the EGM to be convened. They have also undertaken to ensure persons connected to them will abstain from voting in respect of their direct and indirect shareholdings on the resolutions pertaining to the Proposed Disposal 1 to be tabled at the EGM to be convened.

11. ADVISERS AND INDEPENDENT ADVISER HLIB has been appointed as the Principal Adviser for the Proposed Disposals. In view of the interests disclosed in Section 10 above, the Proposed Disposals are deemed as related party transactions pursuant to Paragraph 10.08 of the Listing Requirements. In this respect, KAF Investment Bank Berhad has been appointed to act as the Independent Adviser to advise the non-interested Directors and non-interested shareholders of Perduren as to whether the Proposed Disposals are fair and reasonable as far as the non-interested shareholders are concerned and whether the Proposed Disposals are to the detriment of the non-interested shareholders of the Company.

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12. DIRECTORS’ STATEMENT The Board (save for Law Wai Cheong and Loh Chen Yook who have abstained from all deliberations on the Proposed Disposal 1 and Proposed Disposal 2, respectively), having considered and deliberated on all aspects of the Proposed Disposals, particularly the rationale for the Proposed Disposals, the financial effects of the Proposed Disposals, and after taking into consideration the valuations of the investment property and property development project as ascribed by HB Johor and HB KL and the preliminary opinion of the Independent Adviser, is of the opinion that the Proposed Disposals are in the best interest of the Company.

13. STATEMENT BY THE AUDIT COMMITTEE The Audit Committee of Perduren (save for Loh Chen Yook who has abstained from all deliberations on the Proposed Disposal 2), after having considered all aspects of the Proposed Disposals, including but not limited to the rationale, the terms of the SSAs, risk factors and the financial effects of the Proposed Disposals, is of the opinion that the Proposed Disposals are: (i) in the best interest of the Company; (ii) fair, reasonable and on normal commercial terms; and (iii) not detrimental to the interests of the non-interested shareholders of the Company. In arriving at the above view, the Audit Committee of Perduren had taken into consideration, among others, the following: (i) the preliminary opinion of the Independent Adviser;

(ii) the basis of arriving at the disposal considerations and the valuations of the investment

property and property development project as ascribed by HB Johor and HB KL; and (iii) the rationale for the Proposed Disposals.

14. PERCENTAGE RATIO Based on the latest audited consolidated financial statements of Perduren for the financial year ended 31 March 2014, the highest percentage ratio applicable for the Proposed Disposals pursuant to Paragraph 10.02(g) of the Listing Requirements is approximately 50.8%.

15. ESTIMATED TIMEFRAME FOR COMPLETION Barring any unforeseen circumstances and subject to the receipt of all relevant approvals, the Proposed Disposals are expected to be completed by the first half of year 2015.

16. TOTAL AMOUNT TRANSACTED WITH THE SAME RELATED PARTY FOR THE PRECEDING 12 MONTHS As at the date of this announcement, save for the rental payable by Perduren to LTS Capital Sdn Bhd, a company beneficially owned by TSDLTS and PSDSGN, in respect of the rental of office premises at a monthly rental of RM12,000, there were no other related party transactions with the interested Directors and/or interested major shareholders (including persons connected with them) for the 12 months preceding the date of this announcement.

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17. DOCUMENTS AVAILABLE FOR INSPECTION The SSAs, Shareholders’ Agreement and the valuation letters prepared by HB Johor and HB KL are available for inspection at the registered office of Perduren during the normal office hours from Mondays to Fridays (except public holidays) at No. 47, 2nd Floor, Jalan 1/116B, Kuchai Entrepreneurs Park, Off Jalan Kuchai Lama, 58200 Kuala Lumpur for a period of three (3) months from the date of this announcement.

This announcement is dated 8 December 2014.

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SALIENT TERMS OF THE SSAs AND SHAREHOLDERS’ AGREEMENT

1. Salient terms of the SSA-A (Terms defined in this Section 1 shall apply throughout Section 1 only)

1.1 Purchase price

(i) Subject to the terms and conditions contained in the SSA-A, the purchase price of

RM71,800,000.00 (“Purchase Price”) for 100,000,000 ordinary shares of RM1.00 each in AESB (“AESB Sale Shares”) is arrived at on a “willing buyer – willing seller” basis.

(ii) In the event that the approval of the Securities Commission Malaysia (“SC”) contains any

terms or conditions requiring the adjustment of the Purchase Price, the parties shall in good faith adjust the Purchase Price accordingly upon such terms and conditions as may be agreed upon between the parties.

(iii) The Purchase Price shall be paid by JISB in the following manner:

(a) upon the execution of the SSA-A, JISB shall retain RM1,436,000.00 representing 2% of

the Purchase Price (“Retention Sum”), which shall form part payment of and towards the account of the Purchase Price, in accordance with the Real Property Gains Tax Act 1976 (“RPGT Act”) and shall pay the Retention Sum to the Director General of Inland Revenue Board of Malaysia (“Director General”) in accordance with the terms of the SSA-A;

(b) upon the execution of the SSA-A, JISB shall pay RM2,154,000.00 (“Balance Deposit”)

to Perduren as part payment towards the Purchase Price. The aggregate of the Retention Sum and Balance Deposit shall be referred to as the “Deposit”; and

(c) RM68,210,000.00 (“Balance Purchase Price”) shall be paid by JISB on the Completion

Date (as defined in Section 1.5 below) in accordance with the SSA-A.

1.2 Conditions precedent

(i) The obligations of the parties to complete the sale and purchase of the AESB Sale Shares are conditional upon the following conditions being fulfilled within 6 months from the date of the SSA-A, or such other dates as the parties may agree in writing (“Stop Date”):

(a) the approval of the shareholders of Perduren for the sale of the AESB Sale Shares upon

the terms and conditions contained in the SSA-A being obtained by Perduren at its duly convened EGM;

(b) the approval of the shareholders of JISB for the purchase of the AESB Sale Shares

upon the terms and conditions contained in the SSA-A being obtained by JISB; (c) SSA-B and SSA-C being executed; and (d) if necessary, the consent or approval of the banks, financiers and creditors of AESB

and/or Perduren for the sale of the AESB Sale Shares being obtained. (ii) The SSA-A shall cease to be conditional upon the date when all the conditions referred to in

Section 1.2(i) above have been fulfilled (“Unconditional Date”) on or before the Stop Date or such extended period as the parties may mutually agree in writing.

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(iii) If any of the conditions referred to in Section 1.2(i) above remains unsatisfied or unfulfilled by the expiration of the Stop Date, any party may terminate the SSA-A by giving written notice to the other party. Upon receipt of such notice by the other party, the SSA-A shall forthwith terminate whereupon

(a) Perduren shall within 14 days of receipt of the termination notice:

(aa) return the Balance Deposit to JISB without interest; and (bb) if the Retention Sum has been remitted to the Director General in accordance

with Section 21B(1) of the RPGT Act, pay to JISB an amount equal to the Retention Sum;

and neither party shall have any further claim against the other pursuant to the SSA-A save for any antecedent breach.

(iv) Where the Retention Sum has been remitted to the Director General, Perduren shall be

responsible for recovering the amount paid to the Director General without recourse to JISB and be entitled to retain the amount so recovered from the Director General.

1.3 Confirmation by SC

(i) Pursuant to the conditional take-over offer by TS Law to acquire the Perduren Shares, TS Law has provided the following undertaking (“Undertaking”), as set out in the offer document dated 17 December 2013:

“Continuation of Perduren Group’s business The Offeror does not have any plan to liquidate Perduren and intends to continue with the existing businesses and operations of the Perduren Group for the next twelve (12) months after the Closing Date. The Offeror shall review the businesses and operations of the Perduren Group and make such arrangements, rationalisation and reorganisation of the Perduren Group in order to improve the Perduren Group’s prospects for future growth. Nevertheless, these are neither specific nor concrete plans, and such intention will only crystallise upon completion of the Offer and after the Offeror has conducted a review of the financial position and operations of the Perduren Group. Major changes to Perduren Group’s business There is no plan by the Offeror to introduce any major changes, dispose of any major assets or undertake any major redeployment of assets of the Perduren Group. The Offeror may rationalise and/or reorganise and/or restructure the business, operations and assets of the Perduren Group, which may encompass, but not limited to, changes to its corporate structure or business, redeployment or disposal of assets or integration or separation of business with a view to enhance the future growth of the Perduren Group. Nevertheless, these are neither specific nor concrete plans, and major changes to the Perduren Group’s business may only carry out if the need arises and after the Offeror has conducted a review of the financial position and operations of the Perduren Group.”

(ii) JISB (or such other party as may be appointed by JISB after consulting with Perduren) shall as

soon as practicable after the execution of the SSA-A submit and apply to SC for its confirmation (“SC’s Confirmation”) that the sale and purchase of the AESB Sale Shares in accordance with the terms and conditions of SSA-A and all other transactions contemplated therein do not breach the Undertaking or that SC has no objection to the transactions contemplated therein taking place on or prior to 14 February 2015 (“Relevant Date”). Perduren shall do all acts and execute all necessary documents to assist JISB (or such other

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party as may be appointed by JISB after consulting with Perduren) to apply for the SC’s Confirmation.

(iii) In the event that:

(a) the parties fail to receive the SC’s Confirmation on or before the Stop Date; or

(b) SC imposes certain conditions in connection with the SC’s Confirmation obtained and such conditions remain unfulfilled on or before the Stop Date,

the obligations of the parties to undertake and complete the sale and purchase of the AESB Sale Shares shall not be adversely affected and SSA-A shall not be terminated or rescinded. For the avoidance of doubt, the following shall apply:

(a) where SC’s Confirmation has not been received or is not available or forthcoming, the

parties shall undertake and complete the sale and purchase of the AESB Sale Shares 30 days after the Relevant Date and shall do all acts and take all necessary actions and execute all necessary documents to affirm and confirm their obligations to undertake and complete the sale and purchase of the AESB Sale Shares herein 30 days after the Relevant Date and shall also incorporate and adopt or affirm and confirm the applicability of the terms and conditions of SSA-A (with changes where necessary) as it applies to their affirmed and confirmed obligations to undertake and complete the sale and purchase of the AESB Sale Shares herein. Thereafter, the parties shall proceed to complete the transaction; and

(b) where SC imposes certain conditions in connection with the SC’s Confirmation obtained,

the parties shall do all acts, take all necessary actions and execute all necessary documents to comply with any conditions that may be imposed by SC in connection to the SC’s Confirmation (if any) and to complete the sale and purchase of the AESB Sale Shares in accordance with the terms and conditions contained in SSA-A.

1.4 Inter-conditional

(i) The SSA-A is inter-conditional with SSA-B and SSA-C. SSA-A shall not be completed unless

the SSA-B and SSA-C are also completed concurrently and if for any reason any of the SSA-B and SSA-C is rescinded or terminated, SSA-A will ipso facto of such rescission or termination also be rescinded or terminated, as the case may be.

(ii) If the SSA-A is rescinded or terminated in accordance with Section 1.4(i) above, SSA-A shall

cease to have effect and each party shall have no claim under it against the other, save in respect of ay antecedent breach.

1.5 Completion

Completion of the sale and purchase of the AESB Sale Shares shall take place on a date falling 14 days after the Unconditional Date or such other date as the parties may agree (“Completion Date”).

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2. Salient terms of the SSA-B (Terms defined in this Section 2 shall apply throughout Section 2 only)

2.1 Purchase price

(i) Subject to the terms and conditions contained in the SSA-B, the purchase price of

RM1,300,000.00 (“Purchase Price”) for 2 ordinary shares of RM1.00 each in BFSB (“BFSB Sale Shares”) is arrived at on a “willing buyer – willing seller” basis.

(ii) In the event that the approval of Securities Commission Malaysia (“SC”) contains any terms or

conditions requiring the adjustment of the Purchase Price, the parties shall in good faith adjust the Purchase Price accordingly upon such terms and conditions as may be agreed upon between the parties.


(a) upon the execution of the SSA-B, JISB shall pay RM65,000.00 (“Deposit”) to Perduren

as part payment towards the Purchase Price; and

(b) RM1,235,000.00 (“Balance Purchase Price”) shall be paid by JISB on the Completion Date (as defined in Section 2.5 below) in accordance with the SSA-B.


(i) The obligations of the parties to complete the sale and purchase of the BFSB Sale Shares are conditional upon the following conditions being fulfilled within 6 months from the date of the SSA-B, or such other dates as the parties may agree in writing (“Stop Date”):

(a) the approval of the shareholders of Perduren for the sale of the BFSB Sale Shares upon

the terms and conditions contained in the SSA-B being obtained by Perduren at its duly convened EGM;

(b) the approval of the shareholders of JISB for the purchase of the BFSB Sale Shares

upon the terms and conditions contained in the SSA-B being obtained by JISB; (c) SSA-A and SSA-C being executed; and (d) if necessary, the consent or approval of the banks, financiers and creditors of BFSB

and/or Perduren for the sale of the BFSB Sale Shares being obtained.

(ii) The SSA-B shall cease to be conditional upon the date when all the conditions referred to in Section 2.2(i) above have been fulfilled (“Unconditional Date”) on or before the Stop Date or such extended period as the parties may mutually agree in writing.

(iii) If any of the conditions referred to in Section 2.2(i) above remains unsatisfied or unfulfilled by

the expiration of the Stop Date, any party may terminate the SSA-B by giving written notice to the other party. Upon receipt of such notice by the other party, the SSA-B shall forthwith terminate whereupon Perduren shall within 14 days of receipt of the termination notice return the Deposit to JISB without interest and neither party shall have any further claim against the other pursuant to the SSA-B save for any antecedent breach.

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“Continuation of Perduren Group’s business The Offeror does not have any plan to liquidate Perduren and intends to continue with the existing businesses and operations of the Perduren Group for the next twelve (12) months after the Closing Date. The Offeror shall review the businesses and operations of the Perduren Group and make such arrangements, rationalisation and reorganisation of the Perduren Group in order to improve the Perduren Group’s prospects for future growth. Nevertheless, these are neither specific nor concrete plans, and such intention will only crystallise upon completion of the Offer and after the Offeror has conducted a review of the financial position and operations of the Perduren Group. Major changes to Perduren Group’s business There is no plan by the Offeror to introduce any major changes, dispose of any major assets or undertake any major redeployment of assets of the Perduren Group. The Offeror may rationalise and/or reorganise and/or restructure the business, operations and assets of the Perduren Group, which may encompass, but not limited to, changes to its corporate structure or business, redeployment or disposal of assets or integration or separation of business with a view to enhance the future growth of the Perduren Group. Nevertheless, these are neither specific nor concrete plans, and major changes to the Perduren Group’s business may only carry out if the need arises and after the Offeror has conducted a review of the financial position and operations of the Perduren Group.”

(ii) JISB (or such other party as may be appointed by JISB after consulting with Perduren) shall as

soon as practicable after the execution of the SSA-B submit and apply to SC for its confirmation (“SC’s Confirmation”) that the sale and purchase of the BFSB Sale Shares in accordance with the terms and conditions of SSA-B and all other transactions contemplated therein do not breach the Undertaking or that SC has no objection to the transactions contemplated therein taking place on or prior to 14 February 2015 (“Relevant Date”). Perduren shall do all acts and execute all necessary documents to assist JISB (or such other party as may be appointed by JISB after consulting with Perduren) to apply for the SC’s Confirmation.




the obligations of the parties to undertake and complete the sale and purchase of the BFSB Sale Shares shall not be adversely affected and SSA-B shall not be terminated or rescinded. For the avoidance of doubt, the following shall apply:


parties shall undertake and complete the sale and purchase of the BFSB Sale Shares 30 days after the Relevant Date and shall do all acts and take all necessary actions and execute all necessary documents to affirm and confirm their obligations to undertake and complete the sale and purchase of the BFSB Sale Shares herein 30 days after the Relevant Date and shall also incorporate and adopt or affirm and confirm the applicability of the terms and conditions of SSA-B (with changes where necessary) as it

APPENDIX I

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applies to their affirmed and confirmed obligations to undertake and complete the sale and purchase of the BFSB Sale Shares herein. Thereafter, the parties shall proceed to complete the transaction; and


the parties shall do all acts, take all necessary actions and execute all necessary documents to comply with any conditions that may be imposed by SC in connection to the SC’s Confirmation (if any) and to complete the sale and purchase of the BFSB Sale Shares in accordance with the terms and conditions contained in SSA-B.


(i) The SSA-B is inter-conditional with SSA-A and SSA-C. SSA-B shall not be completed unless

the SSA-A and SSA-C are also completed concurrently and if for any reason any of the SSA-A and SSA-C is rescinded or terminated, SSA-B will ipso facto of such rescission or termination also be rescinded or terminated, as the case may be.

(ii) If the SSA-B is rescinded or terminated in accordance with Section 2.4(i) above, SSA-B shall


2.5 Completion

Completion of the sale and purchase of the BFSB Sale Shares shall take place on a date falling 14 days after the Unconditional Date or such other date as the parties may agree (“Completion Date”).

3. Salient terms of the SSA-C (Terms defined in this Section 3 shall apply throughout Section 3 only)

3.1 Purchase price

(i) Subject to the terms and conditions contained in the SSA-C, the purchase price of

RM100,000.00 (“Purchase Price”) for 2,200,000 ordinary shares of RM1.00 each in GSHSB (“GSHSB Sale Shares”) is arrived at on a “willing buyer – willing seller” basis.




(a) upon the execution of the SSA-C, JISB shall pay RM5,000.00 (“Deposit”) to Perduren

as part payment towards the Purchase Price; and

(b) RM95,000.00 (“Balance Purchase Price”) shall be paid by JISB on the Completion Date (as defined in Section 3.5 below) in accordance with the SSA-C.


(i) The obligations of the parties to complete the sale and purchase of the GSHSB Sale Shares are conditional upon the following conditions being fulfilled within 6 months from the date of the SSA-C, or such other dates as the parties may agree in writing (“Stop Date”):

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(a) the approval of the shareholders of Perduren for the sale of the GSHSB Sale Shares upon the terms and conditions contained in the SSA-C being obtained by Perduren at its duly convened EGM;

(b) the approval of the shareholders of JISB for the purchase of the GSHSB Sale Shares

upon the terms and conditions contained in the SSA-C being obtained by JISB; (c) SSA-A and SSA-B being executed; and (d) if necessary, the consent or approval of the banks, financiers and creditors of GSHSB

and/or Perduren for the sale of the GSHSB Sale Shares being obtained.

(ii) The SSA-C shall cease to be conditional upon the date when all the conditions referred to in Section 3.2(i) above have been fulfilled (“Unconditional Date”) on or before the Stop Date or such extended period as the parties may mutually agree in writing.


the expiration of the Stop Date, any party may terminate the SSA-C by giving written notice to the other party. Upon receipt of such notice by the other party, the SSA-C shall forthwith terminate whereupon Perduren shall within 14 days of receipt of the termination notice return the Deposit to JISB without interest and neither party shall have any further claim against the other pursuant to the SSA-C save for any antecedent breach.



“Continuation of Perduren Group’s business The Offeror does not have any plan to liquidate Perduren and intends to continue with the existing businesses and operations of the Perduren Group for the next twelve (12) months after the Closing Date. The Offeror shall review the businesses and operations of the Perduren Group and make such arrangements, rationalisation and reorganisation of the Perduren Group in order to improve the Perduren Group’s prospects for future growth. Nevertheless, these are neither specific nor concrete plans, and such intention will only crystallise upon completion of the Offer and after the Offeror has conducted a review of the financial position and operations of the Perduren Group.

Major changes to Perduren Group’s business There is no plan by the Offeror to introduce any major changes, dispose of any major assets or undertake any major redeployment of assets of the Perduren Group. The Offeror may rationalise and/or reorganise and/or restructure the business, operations and assets of the Perduren Group, which may encompass, but not limited to, changes to its corporate structure or business, redeployment or disposal of assets or integration or separation of business with a view to enhance the future growth of the Perduren Group. Nevertheless, these are neither specific nor concrete plans, and major changes to the Perduren Group’s business may only carry out if the need arises and after the Offeror has conducted a review of the financial position and operations of the Perduren Group.”

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(ii) JISB (or such other party as may be appointed by JISB after consulting with Perduren) shall as soon as practicable after the execution of the SSA-C submit and apply to SC for its confirmation (“SC’s Confirmation”) that the sale and purchase of the GSHSB Sale Shares in accordance with the terms and conditions of SSA-C and all other transactions contemplated therein do not breach the Undertaking or that SC has no objection to the transactions contemplated therein taking place on or prior to 14 February 2015 (“Relevant Date”). Perduren shall do all acts and execute all necessary documents to assist JISB (or such other party as may be appointed by JISB after consulting with Perduren) to apply for the SC’s Confirmation.




the obligations of the parties to undertake and complete the sale and purchase of the GSHSB Sale Shares shall not be adversely affected and SSA-C shall not be terminated or rescinded. For the avoidance of doubt, the following shall apply:


parties shall undertake and complete the sale and purchase of the GSHSB Sale Shares 30 days after the Relevant Date and shall do all acts and take all necessary actions and execute all necessary documents to affirm and confirm their obligations to undertake and complete the sale and purchase of the GSHSB Sale Shares herein 30 days after the Relevant Date and shall also incorporate and adopt or affirm and confirm the applicability of the terms and conditions of SSA-C (with changes where necessary) as it applies to their affirmed and confirmed obligations to undertake and complete the sale and purchase of the GSHSB Sale Shares herein. Thereafter, the parties shall proceed to complete the transaction; and


the parties shall do all acts, take all necessary actions and execute all necessary documents to comply with any conditions that may be imposed by SC in connection to the SC’s Confirmation (if any) and to complete the sale and purchase of the GSHSB Sale Shares in accordance with the terms and conditions contained in SSA-C.


(i) The SSA-C is inter-conditional with SSA-A and SSA-B. SSA-C shall not be completed unless

the SSA-A and SSA-B are also completed concurrently and if for any reason any of the SSA-A and SSA-B is rescinded or terminated, SSA-C will ipso facto of such rescission or termination also be rescinded or terminated, as the case may be.

(ii) If the SSA-C is rescinded or terminated in accordance with Section 3.4(i) above, SSA-C shall


3.5 Completion

Completion of the sale and purchase of the GSHSB Sale Shares shall take place on a date falling 14 days after the Unconditional Date or such other date as the parties may agree (“Completion Date”).

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4. Salient terms of the SSA-D (Terms defined in this Section 4 shall apply throughout Section 4 only)

4.1 Purchase price

(i) Subject to the terms and conditions contained in the SSA-D, the purchase price of

RM8,300,000.00 (“Purchase Price”) for 2,400,000 ordinary shares of RM1.00 each in LZSB (“LZSB Sale Shares”) is arrived at on a “willing buyer – willing seller” basis.



(iii) The Purchase Price shall be paid by MHSB in the following manner:

(a) upon the execution of the SSA-D, MHSB shall pay RM415,000.00 (“Deposit”) to

Perduren as part payment towards the Purchase Price; and

(b) RM7,885,000.00 (“Balance Purchase Price”) shall be paid by MHSB on the Completion Date (as defined in Section 4.4 below) in accordance with the SSA-D.


(i) The obligations of the parties to complete the sale and purchase of the LZSB Sale Shares are

conditional upon the following conditions being fulfilled within 6 months from the date of the SSA-D, or such other dates as the parties may agree in writing (“Stop Date”):

(a) the approval of the shareholders of Perduren for the sale of the LZSB Sale Shares upon

the terms and conditions contained in the SSA-D being obtained by Perduren at its duly convened EGM;

(b) the approval of the shareholders of MHSB for the purchase of the LZSB Sale Shares

upon the terms and conditions contained in the SSA-D being obtained by MHSB; and

(c) if necessary, the consent or approval of the banks, financiers and creditors of LZSB and/or Perduren for the sale of the LZSB Sale Shares being obtained.

(ii) The SSA-D shall cease to be conditional upon the date when all the conditions referred to in

Section 4.2(i) above have been fulfilled (“Unconditional Date”) on or before the Stop Date or such extended period as the parties may mutually agree in writing.


the expiration of the Stop Date, any party may terminate the SSA-D by giving written notice to the other party. Upon receipt of such notice by the other party, the SSA-D shall forthwith terminate whereupon Perduren shall within 14 days of receipt of the termination notice return the Deposit to MHSB without interest and neither party shall have any further claim against the other pursuant to the SSA-D save for any antecedent breach.

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“Continuation of Perduren Group’s business The Offeror does not have any plan to liquidate Perduren and intends to continue with the existing businesses and operations of the Perduren Group for the next twelve (12) months after the Closing Date. The Offeror shall review the businesses and operations of the Perduren Group and make such arrangements, rationalisation and reorganisation of the Perduren Group in order to improve the Perduren Group’s prospects for future growth. Nevertheless, these are neither specific nor concrete plans, and such intention will only crystallise upon completion of the Offer and after the Offeror has conducted a review of the financial position and operations of the Perduren Group.

Major changes to Perduren Group’s business There is no plan by the Offeror to introduce any major changes, dispose of any major assets or undertake any major redeployment of assets of the Perduren Group. The Offeror may rationalise and/or reorganise and/or restructure the business, operations and assets of the Perduren Group, which may encompass, but not limited to, changes to its corporate structure or business, redeployment or disposal of assets or integration or separation of business with a view to enhance the future growth of the Perduren Group. Nevertheless, these are neither specific nor concrete plans, and major changes to the Perduren Group’s business may only carry out if the need arises and after the Offeror has conducted a review of the financial position and operations of the Perduren Group.”

(ii) MHSB (or such other party as may be appointed by MHSB after consulting with Perduren)

shall as soon as practicable after the execution of the SSA-D submit and apply to SC for its confirmation (“SC’s Confirmation”) that the sale and purchase of the LZSB Sale Shares in accordance with the terms and conditions of SSA-D and all other transactions contemplated therein do not breach the Undertaking or that SC has no objection to the transactions contemplated therein taking place on or prior to 14 February 2015 (“Relevant Date”). Perduren shall do all acts and execute all necessary documents to assist MHSB (or such other party as may be appointed by MHSB after consulting with Perduren) to apply for the SC’s Confirmation.




the obligations of the parties to undertake and complete the sale and purchase of the LZSB Sale Shares shall not be adversely affected and SSA-D shall not be terminated or rescinded. For the avoidance of doubt, the following shall apply:


parties shall undertake and complete the sale and purchase of the LZSB Sale Shares 30 days after the Relevant Date and shall do all acts and take all necessary actions and execute all necessary documents to affirm and confirm their obligations to undertake and complete the sale and purchase of the LZSB Sale Shares herein 30 days after the Relevant Date and shall also incorporate and adopt or affirm and confirm the applicability of the terms and conditions of SSA-D (with changes where necessary) as it

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applies to their affirmed and confirmed obligations to undertake and complete the sale and purchase of the LZSB Sale Shares herein. Thereafter, the parties shall proceed to complete the transaction; and


the parties shall do all acts, take all necessary actions and execute all necessary documents to comply with any conditions that may be imposed by SC in connection to the SC’s Confirmation (if any) and to complete the sale and purchase of the LZSB Sale Shares in accordance with the terms and conditions contained in SSA-D.

4.4 Completion

Completion of the sale and purchase of the LZSB Sale Shares shall take place on a date falling 14 days after the Unconditional Date or such other date as the parties may agree (“Completion Date”).

4.5 Execution of Shareholders’ Agreement

Subject to completion taking place in accordance with the SSA-D, the parties agree to execute a shareholders’ agreement in the agreed form as set out in the SSA-D on such date as may be agreed between the parties.

5. Salient terms of the Shareholders’ Agreement Perduren and MHSB have agreed with each other that their relationship and respective rights and obligations as shareholders of LZSB shall be regulated by the shareholders’ agreement (“SHA”). Perduren and MHSB shall collectively be referred to as the “Shareholders”, or individually “Shareholder”.

5.1 Transfer of shares

The Shareholders shall not directly or indirectly, sell, transfer, assign, mortgage, charge, encumber, dispose of or otherwise deal with their shareholdings or part thereof in LZSB except:

(i) with the prior written consent of the other Shareholder; or (ii) in accordance with the provisions of Section 5.2 below,

provided that an accession agreement in form and substance substantially set forth in the SHA shall be entered into by the parties.

5.2 Pre-emption rights

The right of the Shareholders to sell, transfer, assign or otherwise dispose of their respective shareholding in LZSB shall be subject to the restrictions and provisions set out below:

(i) Where a Shareholder intends to sell, transfer, assign or otherwise dispose of its shares

(“Outgoing Shareholder”), it shall give a notice in writing (“Transfer Notice”) of its intention to offer all and not part of its shares for the time being (“Relevant Shares”), to the other Shareholder (“Remaining Shareholder”) at the fair market value (with a copy of the notice being given to LZSB as well).

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(ii) Upon receipt of the Transfer Notice from the Outgoing Shareholder, the Remaining Shareholder shall appoint the auditors of LZSB or such other valuer as may be deemed fit by the board of directors of LZSB (“Valuer”) within 7 days from the date of receipt of the Transfer Notice from the Outgoing Shareholder to determine the fair market value of the Relevant Shares. The Valuer shall determine the fair market value of the Relevant Shares and inform the parties in writing within 14 days from the date of appointment. The costs of appointing the Valuer shall be borne by LZSB. In certifying the fair market value of the Relevant Shares, the Valuer shall be acting as experts and not as arbitrators. The certification by the Valuer of the fair market value shall be final and conclusive save for any manifest error and shall be binding upon the parties, PROVIDED ALWAYS that if the Outgoing Shareholder has already received an existing valid and binding offer for the Relevant Shares from a bona fide purchaser at a specified price (“Specified Price”) then the fair market value shall be deemed to be the Specified Price PROVIDED FURTHER that the Specified Price is not lower than the price certified by the Valuer to be the fair market value.

(iii) The Remaining Shareholder shall have a period of 90 days (“Option Period”), from the date

the fair market value is made known by the Valuer in writing, to exercise the right to purchase the Relevant Shares. Such offer shall be open for acceptance at any time within the Option Period.

(iv) In the event the Remaining Shareholder does not accept the offer within the Option Period, the

Outgoing Shareholder will have to recommence the offer and sale procedure in Section 5.2(i) to (iii) in order to sell the Relevant Shares and the parties shall in good faith negotiate with each other on such terms and conditions as the parties may agree in respect of the sale of the Relevant Shares.

(v) Completion of the sale and purchase of the Relevant Shares, subject to all relevant regulatory

approvals, consents and permits having been obtained, shall take place within 30 days after the date of acceptance of the offer of the Relevant Shares by the Remaining Shareholder.

(vi) In the event of any transfer by the Outgoing Shareholder of the Relevant Shares to the

Remaining Shareholder pursuant to the foregoing provisions, each Shareholder shall, subject to the provisions of Section 5.2(v):

(a) cause and procure their respective nominees on the board of directors to approve the

proposed transfer; and (b) cause and procure that upon such transfer any directors appointed to the board of

directors by the Outgoing Shareholder pursuant to the SHA shall thereupon resign.

5.3 Duration and termination of agreement 5.3.1 Termination upon default

A Shareholder may at any time after the other Shareholder has committed or suffered an event of default, terminate the SHA by giving written notice to the other Shareholders. For the purposes of this Section 5.3.1, a Shareholder shall be deemed to have committed or suffered an event of default if: (i) it commits a breach of any of the terms of the SHA and, in the case of a breach capable of

remedy, fails to remedy the breach within 21 days of its being required in writing to do so by the other Shareholder; or

(ii) a distress, execution or other process is levied against a Shareholder or any of its assets or

property and such distress, execution or process is not discharged within 14 days; or

APPENDIX I

27

(iii) it is unable to pay its debts as and when they fall due; or (iv) it ceases or threatens to cease wholly or substantially to carry on its business, otherwise than

for the purposes of a reconstruction or amalgamation which has been approved by the other Shareholders; or

(v) an encumbrancer takes possession of, or a receiver or a receiver and manager is appointed

over, the whole or any part of its undertaking, property or assets; or (vi) it commits an act of bankruptcy or is declared a bankrupt within the meaning of the Bankruptcy

Act, 1967; or (vii) an order is made or a resolution is passed for its winding up, otherwise than for the purposes

of a reconstruction or amalgamation which has been approved by the other Shareholders.

THE REST OF THIS PAGE IS INTENTIONALLY LEFT BLANK

APPENDIX II

28

HISTORICAL FINANCIAL INFORMATION

(1) AESB

A summary of the key financial information of AESB based on its audited financial statements for the past 3 financial years ended (“FYE”) 31 March 2012, 31 March 2013 and 31 March 2014 and the unaudited 6-month financial period ended (“FPE”) 30 September 2014 is as follows:

<-------------------------Audited--------------------------> Unaudited

FYE 31 March

2012

FYE 31 March

2013

FYE 31 March

2014

6-month FPE 30 September

2014

RM RM RM RM

Revenue 10,004,620 13,115,365 14,649,658 7,618,408

Profit before tax (“PBT”) 265,640 3,064,347 3,523,161 1,125,378

(Loss)/ Profit after tax (78,136) 2,545,243 2,578,616 799,188

Shareholders’ fund/ NA 63,946,605 66,491,848 69,070,464 69,869,652

No. of shares in issue 100,000,000 100,000,000 100,000,000 100,000,000

NA per share 0.64 0.66 0.69 0.70

Total borrowings 66,130,681 64,911,652 58,695,079 55,140,542

Gearing (times) 1.03 0.98 0.85 0.79

Commentaries:

(1) For the FYE 31 March 2012, revenue increased by 16.71% to RM10.00 million from RM8.57 million in the previous financial year due to higher occupancy of Plaza Sentosa which increased the rental and carpark income to the company. Nevertheless, AESB recorded a loss of RM0.08 million for the FYE 31 March 2012 as compared to a profit after tax (“PAT”) of RM0.84 million for the FYE 31 March 2011 due to increase in expenses, notably from the financing costs for refurbishment of Plaza Sentosa and provision for bad debts.

(2) For the FYE 31 March 2013, revenue increased by 31.09% to RM13.11 million from RM10.00 million in

the previous financial year due to higher rental and carpark income arising from higher occupancy of Plaza Sentosa. AESB recorded higher PAT of RM2.55 million for the FYE 31 March 2013 as compared to a loss of RM0.08 million for the FYE 31 March 2012 due to higher revenue for the FYE 31 March 2013.

(3) Revenue increased further by 11.70% from RM13.12 million for the FYE 31 March 2013 to RM14.65

million for the FYE 31 March 2014. For the FYE 31 March 2013, there was a rental rebate for tenants paying in advance. This rebate was removed during the FYE 31 March 2014, which contributed to higher rental income and hence higher revenue for that financial year. However, despite the increase in revenue, PAT remained at approximately RM2.58 million for the FYE 31 March 2014 due to higher expenses incurred which included redevelopment planning expenses of RM0.47 million and higher tax expenses of RM0.95 million during the financial year.

(4) For the 6-month FPE 30 September 2014, AESB recorded an increase in revenue by 11.41% to RM7.62

million from RM6.84 million for the 6-month FPE 30 September 2013 due to the provision of rental rebate for tenants paying in advance during the 6-month FPE 30 September 2013 which was removed during the 6-month FPE 30 September 2014. AESB recorded a decrease in PAT by 24.71% to RM0.80 million for 6-month FPE 30 September 2014 from RM1.06 million for the previous 6-month FPE 30 September 2013 due to higher utility expenses of RM1.14 million and redevelopment planning expenses of RM0.36 million incurred during the financial period.

APPENDIX II

29

(2) BFSB

A summary of the key financial information of BFSB based on its audited financial statements for the past 3 FYE 31 March 2012, FYE 31 March 2013, FYE 31 March 2014 and the unaudited 6-month FPE 30 September 2014 is as follows:


FYE 31 March

2012

FYE 31 March

2013

FYE 31 March

2014


2014

RM RM RM RM

Revenue 3,326,845 3,755,129 3,573,964 1,803,771

PBT 663,846 487,241 342,479 187,107

PAT 527,040 334,697 260,735 139,098

Shareholders’ fund/ NA 488,702 823,399 1,084,134 1,223,233

No. of shares in issue 2 2 2 2

NA per share 244,351 411,699 542,067 611,616

Total borrowings - - - -

Gearing (times) - - - -

Commentaries: (1) For the FYE 31 March 2012, BFSB recorded significant increase in revenue to RM3.33 million from

RM0.39 million in the previous financial year. BFSB recorded PAT of RM0.53 million for the FYE 31 March 2012 as compared to loss of RM0.04 million for the FYE 31 March 2011. There was significant increase in revenue and turnaround from loss to PAT for the FYE 31 March 2012 as BFSB had just commenced operations during the FYE 31 March 2011.

(2) BFSB recorded an increase of 12.87% in revenue for the FYE 31 March 2013 to RM3.76 million from

RM3.33 million for the FYE 31 March 2012 due to increase in carpark income arising from higher occupancy rate in Plaza Sentosa for the FYE 31 March 2013. However, BFSB recorded a decrease of 36.49% in PAT to RM0.33 million for the FYE 31 March 2013 from RM0.53 million for the FYE 31 March 2012 due to higher operating costs. The increase in operating costs was mainly due to higher complex service charges, security charges and staff costs for the FYE 31 March 2013.

(3) BFSB recorded a slight decrease in revenue for the FYE 31 March 2014 of 4.82% to RM3.57 million from

RM3.76 million for the FYE 31 March 2013 due to lower car park income of Plaza Sentosa for the FYE 31 March 2014. As a result of the lower revenue as well as increase in staff costs and utility expenses, PAT decreased by 22.10% to RM0.26 million for the FYE 31 March 2014 from RM0.33 million for the FYE 31 March 2013.

(4) BFSB recorded increase in revenue for the 6-month FPE 30 September 2014 by 6.54% to RM1.80 million

from RM1.69 million for the 6-month FPE 30 September 2013 due to increase in car park income arising from higher occupancy rate in Holiday Plaza for the 6-month FPE 30 September 2014. BFSB recorded an increase in PAT by 78.46% to RM0.14 million for the 6-month FPE 30 September 2014 from RM0.08 million for the 6-month FPE 30 September 2013 due to the increase in revenue.

APPENDIX II

30

(3) GSHSB

A summary of the key financial information of GSHSB based on its audited financial statements for the past 3 FYE 31 March 2012, FYE 31 March 2013, FYE 31 March 2014 and the unaudited 6-month FPE 30 September 2014 is as follows:


FYE 31 March

2012

FYE 31 March

2013

FYE 31 March

2014


2014

RM RM RM RM

Revenue 2,489,931 5,918,046 7,010,354 3,567,151

Loss before tax (“LBT”) (1,710,292) (261,730) (285,157) (378,502)

Loss after tax (“LAT”) (1,699,949) (261,730) (285,794) (378,502)

Shareholders’ fund/ NA/ NL

229,378 (32,352) (318,146) (696,646)

No. of shares in issue 2,200,000 2,200,000 2,200,000 2,200,000

NA/ NL per share 0.10 (0.01) (0.14) (0.32)

Total borrowings 84,127 65,491 45,477 34,954

Gearing (times) 0.37 N/A N/A N/A

Commentaries:

(1) For the FYE 31 March 2012, GSHSB recorded increase in revenue by 76.01% to RM2.49 million from

RM1.41 million in the previous financial year due to increase in number of rooms at the hotel for the FYE 31 March 2012. GSHSB recorded higher loss of RM1.70 million for the FYE 31 March 2012 as compared to loss of RM0.27 million for the FYE 31 March 2011 due to increase in operating costs such as staff costs, depreciation of the property, plant and equipment, rental, utility expenses as well as higher interest expense on amount owing to a related company.

(2) GSHSB recorded an increase in revenue of 137.68% for the FYE 31 March 2013 to RM5.92 million from

RM2.49 million for the FYE 31 March 2012 due to higher occupancy rate of the hotel for the FYE 31 March 2013. Consequently, LAT decreased by 84.60% to RM0.26 million for the FYE 31 March 2013 from RM1.70 million for the FYE 31 March 2012.

(3) GSHSB recorded an increase of 18.46% in revenue for the FYE 31 March 2014 to RM7.01 million from

RM5.92 million for the FYE 31 March 2013. The increase in revenue was primarily attributed to the higher occupancy rate of the hotel for the FYE 31 March 2014. However, GSHSB recorded a slight increase in LAT of 9.19% to RM0.29 million for the FYE 31 March 2014 from RM0.26 million for the FYE 31 March 2013 due to increase in staff costs for the FYE 31 March 2014.

(4) GSHSB recorded decrease in revenue for the 6-month FPE 30 September 2014 by 5.55% to RM3.57

million from RM3.78 million for the 6-month FPE 30 September 2013 due to lower occupancy rate of the hotel for the 6-month FPE 30 September 2014. GSHSB recorded LAT of RM0.38 million for the 6-month FPE 30 September 2014 as compared to PAT of RM0.33 million for the 6-month FPE 30 September 2013 due to higher staff costs and utility expenses incurred during the 6-month FPE 30 September 2014.

APPENDIX II

31

(4) LZSB

A summary of the key financial information of LZSB based on its audited financial statements for the past 3 FYE 31 March 2012, FYE 31 March 2013, FYE 31 March 2014 and the unaudited 6-month FPE 30 September 2014 is as follows:

<-------------------------Audited------------------------> Unaudited

FYE 31 March

2012

FYE 31 March

2013

FYE 31 March

2014


2014

RM RM RM RM

Revenue - - 34,818,741 28,001,409

PBT/ LBT (15,433) (263,897) 2,962,673 4,085,870

PAT/ LAT (15,433) (263,897) 2,222,490 3,046,361

Shareholders’ fund/ NA / NL 220,314 (43,583) 9,928,907 12,975,269

No. of shares in issue 250,000 250,000 8,000,000 8,000,000

NA/ NL per share 0.88 (0.17) 1.24 1.62

Total borrowings 3,200,000 3,200,000 25,496,475 35,185,346

Gearing (times) 14.52 N/A 2.57 2.71

Commentaries:

(1) LZSB did not record any revenue for the FYE 31 March 2012 and FYE 31 March 2013 as its property development project was in planning stage. Losses incurred during the two financial years were mainly due to operating and administrative expenses.

(2) The joint venture property development project undertaken by LZSB was launched in July 2013 and the

company started recognising property development revenue and costs after the commencement of the sale of serviced apartments and retails lots during the FYE 31 March 2014. As at the end of the FYE 31 March 2014, LZSB achieved sales of approximately 70% of total units and recognised revenue of RM34.8 million. Following the commencement of sale of property, cost of sale was recognised and operating expenses increased during the financial year. The company recorded PAT of RM2.22 million for the FYE 31 March 2014.

(3) For the 6-month FPE 30 September 2014, LZSB recorded revenue of RM28.00 million and PAT of

RM3.05 million following the commencement of sale of serviced apartments and retails lots from its joint venture property development project. LZSB did not record any revenue for the 6-month FPE 30 September 2013 as there was no recorded sale of property during the financial period. Accordingly, the losses incurred during the 6-month FPE 30 September 2013 were mainly due to operating and administrative expenses.

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