Unless otherwise stated, the abbreviations and definitions used throughout this announcement shall have the same meaning as those previously defined in the Company’s announcement dated 31 March 2021 in relation to the Joint Venture Agreement.

The Board of Directors of PRG wishes to provide the following additional information:-

1. (a) & (b) Basis and justification for the Proprietor’s Entitlement of RM8,000,000

Previously, there was a SPA entered between the Proprietor and SH dated with total considerations of RM7,200,000. This was terminated mutually due to SH’s inability to obtain bank financing for this acquisition.

SH then approached the Proprietor to re-negotiate the agreement and hence a new JVA with total consideration of RM8,000,000 was signed. The agreed sum was higher after taking into account the interest element in the defer payment scheme proposed by SH. The Group also recognised that this JVA is supported by SH’s director’s personal guarantee.

The Group opined that the said disposal/ joint venture will eliminate further cash outflow to this project, and to allow the Group to focus more on existing or new development projects.

(c)  Intended utilisation of the proceeds of RM8,000,000

The proceeds of RM8,000,000 is expected to be utilised as follows:

Note: The proceeds to be used for settlement of amounts due to creditors and the balance to be utilised as working capital for its existing and/or new businesses.

(d) Information on the Lands (Part C of Appendix 10A in the MMLR)

Details of the Land

(e) The original cost of investment in the land and the date of such investment

The original cost of investment was RM8,660,273 on 10 October 2017.

(f) Details of the development

The development consists of 213 units/ lots of individual land titles in Mukim Teja, Daerah Kinta, Perak Darul Ridzuan.

(g) Particular of any liabilities, including contingent liabilities, which remain with the Group, together with the details and justification for such arrangements, and any guarantee given to the Developer

Approximately RM3,780,000 owing to existing main contractor will be repaid through the partial utilisation of the proceeds. Other than above, the Company is not aware of any contingent liability remain with the Group as of the date of this announcement. There is no guarantee given to the Developer.

(h) Termination clauses of the JVA

The Proprietor’s Right to Terminate

(a) The Proprietor’s has right to terminate in the event of any breach by the Developer, the Proprietor shall be entitled to, at any time after any such breach or default on the part of  the Developer arises, give written notice to the Developer terminating this JVA if:-

(i) the Developer defaults in the satisfaction of the Proprietor’s Entitlement or part thereof in accordance with the provisions of this JVA and within the time line stipulated in t   this  JVA; and/or

(ii) the Developer fails, neglects or refuses to perform or comply with any of its obligations under this JVA; and/or

and the Developer has not remedied such breach or default within Fourteen (14) Business Days of receipt of a notice from the Proprietor demanding the Developer to remedy such breach or default.

Termination in Event of Insolvency:

(a) Either party will be entitled, at any time prior to completion of this JVA, give notice to the other party terminating the JVA if the other party:-

(i) is or becomes, or is adjudicated or found to be insolvent or insolvency proceedings, or go into liquidation whether compulsory or voluntarily (except for the purpose of reconstructions, amalgamation or other similar purpose not involving the realization of assets) commenced against it or is wound up; or

(ii) admits inability to pay its debts as they fall due or proposes or enters into any composition or other arrangement for the benefit of its creditors generally or do any act jeopardizing the rights of the other party to the said Land or the rights of the other under this Joint Venture, or proceedings are commenced in relation to that party under any law, regulation or procedure relating to reconstruction or adjustment of debts.

Consequences of termination by the Proprietor:

(a) The Proprietor shall:

(i) forfeit all sum paid by the Developer to the Proprietor under this JVA;

(ii) decide at its absolute discretion whether to proceed with the Development and claim the costs and expenses incurred therein from the Developer or to enter into joint venture with any persons or to act accordingly as it deems fit, without having to account to the Developer.

(b) The Developer shall:

(i) redeliver the said Land free from Encumbrances to the Proprietor (if the same has been delivered to the Developer) with the interest therein intact;

(ii) return the Title to the Proprietor (if the same has been delivered to the Developer or the Developer’s Solicitors);

(iii) remove at the Developer’s own cost and expense all Encumbrances against the said Land whether lodged by the Developer and/or any other persons save and except for the Proprietor and the existing Caveator;

(iv) return all documents forwarded by the Proprietor or the Proprietor’s Solicitors to the Developer or the Developer’s Solicitors intact; and

(v) unconditionally and irrevocably relinquish all its rights and entitlement pursuant to this JVA.

(c) Thereafter this JVA shall terminate and of no legal effect and the Proprietor may deal with the said Land and the Development or any part thereof in any manner as it deems fit and proper without any reference to the Developer.

(i) Estimated time frame for completion of the JVA

Barring any unforeseen circumstances, it is estimated to be completed within one month from the date of JVA.