appendix yli holdings berhad supply of pipes, fittings ... - Bursa Malaysia

General Announcement Reference No. GA1-08032016-00041

APPENDIX YLI HOLDINGS BERHAD SUPPLY OF PIPES, FITTINGS AND RELATED PRODUCTS BY LAKSANA WIBAWA SDN. BHD., A 51% OWNED SUBSIDIARY OF YLI FOR THE PROJECT “PROPOSED DEVELOPMENT OF LANGAT 2 WATER TREATMENT PLANT AND WATER RETICULATION SYSTEM IN SELANGOR DARUL EHSAN/WILAYAH PERSEKUTUAN KUALA LUMPUR”

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INTRODUCTION

The Board of Directors of YLI Holdings Berhad ("YLI") wishes to announce that Laksana Wibawa Sdn. Bhd. (“LWSB” or “the Supplier”) of the First Part, a 51% owned subsidiary of YLI, had on 24 March 2016 entered into the Supply and Purchase Agreement (“SPA”) with Pembinaan Ikhasas-Merak Sdn. Bhd. (“PIM” or “Main Contractor”) of the Second Part and Merpatih Trading Sdn. Bhd. (“Merpatih” or “the Purchaser”) of the Third Part, in relation to the supply of the pipes, fittings and related products for the project “Proposed Development of Langat 2 Water Treatment Plant and Water Reticulation System in Selangor Darul Ehsan/Wilayah Persekutuan Kuala Lumpur” (“the Project”).

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BACKGROUND INFORMATION Information on LWSB LWSB was incorporated in Malaysia on 26 August 1996 under the Companies Act, 1965 and having its registered office at D117, Block D, First Floor, Kelana Square, 17 Jalan SS 7/26, Kelana Jaya, 47301 Petaling Jaya, Selangor Darul Ehsan and business address at Lot PT 7157, Batu 22 ½, Mukim Serendah, 48200 Hulu Selangor, Selangor Darul Ehsan. The total issued and paid up share capital of LWSB is RM36,941,984.00 divided into 36,941,984 ordinary shares of RM1.00 each. The principal activity of LWSB is manufacturing of mild steel pipes and trading of mild steel and ductile iron pipes, fittings and related products. Information on PIM PIM was incorporated in Malaysia on 20 August 1996 under the Companies Act, 1965 and having its registered office at No. 2A Jalan BP 4/6, Bandar Bukit Puchong Industrial Park, Puchong, Selangor and business address at Level 3, No. 2A, Jalan BP4/6, Bandar Bukit Puchong Industrial Park, 47120 Puchong, Selangor Darul Ehsan. The total issued and paid up share capital of PIM is RM5,000,000.00 divided into 5,000,000 ordinary shares of RM1.00 each. The principal activity of PIM is contractor in the building industry. Page 1 of 4


Information on Merpatih Merpatih was incorporated in Malaysia on 27 June 2008 under the Companies Act, 1965 and having its registered office at No. 2A Jalan BP 4/6, Bandar Bukit Puchong Industrial Park, Puchong, Selangor and business address at Suite 2.2, Level 2, No. 2A, Jalan BP4/6, Bandar Bukit Puchong Industrial Park, 47120 Puchong, Selangor Darul Ehsan. The total issued and paid up share capital of Merpatih is RM1,500,000.00 divided into 1,500,000 ordinary shares of RM1.00 each. The principal activity of Merpatih is trading in construction materials. 3.0

SALIENT TERMS OF THE SPA Pursuant to the SPA, the Main Contractor through the Purchaser appoints the Supplier to supply pipes, fittings and related products (“the Products”) for the Project on a “back to back basis” with the terms of the Main Contract in relation to the Products supplied and the Supplier agrees and undertakes to manufacture and/or supply the Products to the Main Contractor and/or Purchaser. The SPA shall be conditional upon the fulfillment of the following conditions precedent (collectively referred to as “Conditions Precedent”):(a)

Performance Bond - The Supplier shall procure the issuance in favour of the Purchaser and the Main Contractor and shall deliver the same to the Purchaser and the Main Contractor within fourteen (14) business days from the date of the SPA, an irrevocable and unconditional bank guarantee (on the terms and conditions acceptable to the Purchaser and the Main Contractor) in the sum of Ringgit Malaysia Five Million (RM5.0 million) only, which shall be valid from the date of the SPA until the expiration of the Warranty Period, as security for the due performance and observance of all terms and conditions, representations, warranties, covenants, undertakings, obligations and stipulations on the part of the Supplier under the SPA (“Performance Bond”)

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Documents - The Supplier shall deliver to the Purchaser the following documents:(i) One (1) certified true copy of the Supplier’s Form 24 , 44 and 49; (ii) One (1) certified true copy of the Supplier’s Memorandum & Articles of Association; (iii) One (1) certified true copy of the Supplier’s Directors’ and Shareholder’s resolutions authorizing the entering of SPA and the manufacturing and supplier of the Products for the Project.

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The SPA shall become unconditional on the date on which the Conditions Precedent have been fulfilled (“the Unconditional Date”). The SPA shall commence from the Unconditional Date and shall be valid for the entire duration of the Project unless terminated earlier or otherwise extended pursuant to the terms of the Main Contract or extended by mutual agreement of the parties.

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PROVISIONAL CONTRACT SUM The provisional contract sum for the SPA is Ringgit Malaysia Ninety Seven Million Three Hundred Forty Two Thousand Nine Hundred Thirty Two and Cents Eighty Three (RM97,342,932.83) only (“Provisional Contract Sum”) which shall be inclusive of goods and services tax and delivery cost to the designated project sites or stores (“Delivery Points”).

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TERMS OF PAYMENT Subject to the acceptance of the Products purchased under each Purchase Order, the payment shall be made within sixty (60) days from the date of certification by Pengurusan Aset Air Berhad’s superintendent officer on the Products having been accepted and incorporated into the works and subject to the Purchaser receiving the Supplier’s correct original invoice and appropriate supporting documents evidencing receipt and acceptance of the Products by the Purchaser.

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APPROVAL REQUIRED The SPA entered into between LWSB and PIM and Merpatih are not subject to the approval from the shareholders of YLI.

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FINANCIAL EFFECTS OF THE TRANSACTION 7.1

Earnings The transaction is not expected to have any material effect on the earnings per share of YLI’s Group for the financial year ending 31 March 2016.

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Net Assets The transaction will not have any material effect on the Net Asset of YLI’s Group for the financial year ending 31 March 2016.

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Share Capital The transaction will not have any effects on the issued and paid-up share capital of YLI.

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Substantial Shareholders’ Shareholding The transaction will not have any effect on the substantial shareholders’ shareholdings of YLI.

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INTEREST OF DIRECTORS, MAJOR SHAREHOLDERS AND PERSONS CONNECTED TO SUCH DIRECTORS AND/OR MAJOR SHAREHOLDERS The Board of Directors of YLI is not aware of any of the Directors and/or major shareholders of YLI and/or persons connected with the Directors and/or major shareholders of YLI, having any interest, direct or indirect, in this transaction.

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DIRECTORS’ STATEMENT The Board Directors of YLI, having taken into consideration all aspects of the Transaction, is of the opinion that the Transaction is in the best interests of YLI Group.

This announcement is dated 24 March 2016.

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