1. Introduction

The Board of Directors of the Company wishes to announce that its wholly-owned subsidiary, Uzma Resource Solutions Sdn. Bhd. (“URSSB”) had on 28 February 2020 entered in a Shares Subscription and Shareholders Agreement with Dato’ Nasri Bin Nasrun (“DNN”) (the “Shareholders Agreement”) for the subscription of 765,000 ordinary shares in the share capital of Jannatul Firdaus International Sdn Bhd. (“JFISB”), representing 51% of the total issued shares capital of JFISB, for a total subscription amount of RM765,000.00 (the “Subscription”). 

Following the Subscription, the Company's indirect shareholdings in JFISB through URSSB became 51% resulting in JFISB becoming an indirect subsidiary of the Company.

(URSSB and DNN are collectively referred to as the “Parties”)

2. Information on JFISB

JFISB was incorporated on 27 February 2020 and has a total issued share capital of RM1,500,000.00 comprising of 1,500,000 ordinary shares. JFISB’s principal activities are marketing and distributing a wide range of petrochemicals and industrial chemical products within Malaysia, Asia Pacific and South America.   

The Directors are Dato’ Kamarul Redzuan Bin Muhamed and Dato’ Nasri Bin Nasrun.

3. Salient Terms of the Shareholders Agreement

The salient terms and conditions of the Shareholders Agreement entered into between URSSB and DNN are as follows:

(a) JFISB shall issue and allot 765,000 ordinary shares of nominal value of RM1.00 each to URSSB and 735,000 ordinary shares of nominal value of RM1.00 each to DNN (“Subscription Shares”) at a total consideration of RM1,500,000.00 (“Subscription Price”). URSSB and DNN shall subscribe for the Subscription Shares for the Subscription Price upon the terms and subject to the conditions as stipulated in the Shareholders Agreement.

(b) Upon completion of the Subscription, the shareholdings of JFISB shall be as follows:

(c) The Subscription Shares shall be issued fully paid, free from all charges, liens or other encumbrances whatsoever and shall rank in all respects pari passu inter se, and shall confer the rights and be subject to the restrictions and provisions set out in the Constitution of JFISB.

(d) JFISB shall not be obliged to allot and issue the Subscription Shares if URSSB and DNN are in breach of its obligations under the Shareholders Agreement or if any of the warranties by URSSB and DNN shall not be true and correct in all material respects if repeated on the date of completion of the Subscription.

4. Source of Funds

The Subscription Price for the Subscription will be funded by internally generated funds.

5. Assumption of Liabilities

The Company and its subsidiaries (the “Group”) will not assume any liabilities, including contingent liabilities and guarantees arising from the Shareholders Agreement.

6. Risk Factors

The Shareholders Agreement will not materially change the risk profile of the Group as the Shareholders Agreement is not expected to materially affect the future earnings of the Group.

7. Financial Effects

The Subscription will not have any material effect on the share capital, substantial shareholders’ shareholdings, earnings per share, net assets per share and gearing of the Group for the financial year ended 30 June 2020 (“FY2020”). 

8. Highest Percentage Ratio Applicable To The Subscriptions

Pursuant to Paragraph 10.02(g) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad, the highest percentage ratio applicable to the Subscription is negligible based on the latest audited financial statements of the Company as at 30 June 2020.

9. Directors’ and Major Shareholders’ Interests

None of the directors and/or major shareholders of the Company and/or persons connected with them have any interest, direct or indirect in the Subscription.

10. Directors’ Statement

The Board of Directors of the Company, after considering all the relevant factors, is of the opinion that the Subscription is in the best interest of the Group.

11. Approvals Required

The Subscription does not require approval from shareholders of the Company or any relevant government authorities.

This announcement is dated 2 October 2020.