We refer to the announcements dated 16 December 2019, 13 February 2020, 27 March 2020 and 22 April 2020.

The Board of Directors of Seal Incorporated Berhad (“SEAL” or “the Company”) wishes to announce that the Company’s subsidiary, SPKL had on 08 May 2020, been served with the following two notices by The Chambers of Yu Shin Ong, the Solicitors acting on behalf of Wabina:

1)  Statutory Notice of Demand under Section 466(1)(a) of the Companies Act, 2016 served to the Company’s wholly-owned subsidiary, Seal Properties (KL) Sdn. Bhd. (“SPKL”) by Wabina Constructions & Engineering Sdn Bhd. (“Wabina”)

• A sum of RM7,381,333.13 (together with interests and costs (the said “Demanded Sum”) owing by SPKL as at 8 May 2020 pursuant to the Adjudication Decision dated 24 February 2020 in Adjudication No.  AIAC/D/ADJ-2825-2019 being interim progress claims by Wabina as main Contractor to undertake the main building works for a mixed development project on a portion of the land on Lot PT9149, Jalan Sri Permaisuri, Bandar Sri Permaisuri, Wilayah Persekutuan Kuala Lumpur ("the Project") developed by SPKL.

• 	Details of the Demanded Sum	Amount (RM)
  1.	Adjudicated Sum (as per Adjudication Decision   dated 24/2/2020)	7,025,008.30
  2.	Total Cost of Adjudication Proceeding	30,300.00
  3.	Interest of 5% per annum on RM7,025,008.30 and    RM30,300.00	251,024.83
  4.	Legal Cost	75,000
  	Total	7,381,333,13

• The Demanded Sum if not settled within the stipulated statutory time frame of 21 days from the date of receipt of the statutory of demand, pursuant to Section 466(1)(a) of the Companies Act, 2016, SPKL shall be deemed to be "unable to pay its debts" and proceedings for winding up may be commenced against the Company. The threat to present a winding-up Petition against SPKL is made despite the Companies Exemption Order (No. 2) 2020 made by the Minister of Domestic Trade and Consumer Affairs on 23 April 2020 (“Exemption Order”), stipulating a 6 months period from the service of a Section 466(1)(a) Notice before the company can be deemed unable to pay its debts.

 2) Penang High Court, Originating Summons NO. PA-24C-3-5/2020 [Wabina (Plaintiff) v SPKL (Defendant)]

Application made by Wabina to enforce the Adjudication Decision dated 24 February 2020 in Adjudication No.  AIAC/D/ADJ-2825-2019 pursuant to section 28 of the Construction Industry Payment and Adjudication Act 2012 and to enter Judgment against SPKL for the following:-

FINANCIAL IMPACT ON THE GROUP

Except for the alleged claim in the items (2), (3) and (4) in both the Notice of Demand and the Originating Summons, the principal sum of RM 7,025,008.30 has been fully provided and accounted for in the financial statements year ended 2019 (RM6,386,691.84) and first quarterly result for the period ended September 2019 (RM638,316.47).

There will be no financial and operation impact expected from this Statutory Notice of Demand and also the Originating Summons unless the winding up petition is granted by the Court.

The Company is seeking the necessary legal advice to resolve and/or defend against the above matter, including amongst others, filing legal proceedings against Wabina for declaratory relief on the applicability of the Companies Exemption Order (No. 2) 2020 and to restrain Wabina from presenting any winding-up Petition against SPKL no in conformity with the said Exemption Order.

Further material development on the matter will be announced accordingly.

This announcement is dated 12 May 2020.