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Exchange Filings


28 May 2013


TAMBUN INDAH LAND BERHAD (“Tambun Indah”)
SHAREHOLDERS’ AGREEMENT BETWEEN PALMINGTON SDN. BHD. (“Palmington”), A 60% OWNED-SUBSIDIARY OF TAMBUN INDAH AND RIPRO SDN. BHD. (“Ripro”)

1. INTRODUCTION
      The Board of Directors of Tambun Indah wishes to announce that Palmington had, on 28 May 2013 entered into a Shareholders’ Agreement with Ripro (“the Shareholders’ Agreement”) to regulate their relationship as shareholders via a new company (“NewCo”) to develop part of the Land known as Lot 8753 located at Simpang Ampat, Seberang Perai Selatan and held under the documents of title Geran (First Grade) No. 73120 (formerly H.S.(D) 28461) measuring in total approximately 15.55 acres (“the Property”) into a shopping complex and/or such development as the NewCo deems fit in accordance with the approvals obtained or to be obtained from the appropriate authorities (“the said Development”).

      Palmington also had, on 28 May 2013 acquired one (1) ordinary share of RM1.00 each, representing 50% of the entire issued and paid up share capital of the NewCo, a shelf company known as TNC Capital Sdn. Bhd.

2. INFORMATION OF THE NEWCO
      TNC Capital Sdn. Bhd. (“TNC”), is a private limited company incorporated in Malaysia on 03 April 2013 and having its registered office at 51-21-A Menara BHL Bank, Jalan Sultan Ahmad Shah, 10050 Penang.
      The present authorised share capital of TNC is RM500,000.00 comprising 500,000 ordinary shares of RM1.00 each, of which two (2) ordinary shares had been issued and fully paid-up.
      The principal activity of TNC is to carry out the said Development and thereafter to manage the shopping complex.

3. INFORMATION OF THE RIPRO
      Ripro is a private limited company incorporated in Malaysia on 07 May 1986 and having its registered office at 1001-1002, 1st Floor, Kompleks Sri Putra, Seberang Jalan Putera, 05150 Alor Setar, Kedah.
      The present authorised share capital of Ripro is RM5,000,000.00 comprising 5,000,000 ordinary shares of RM1.00 each, of which 2,225,000 ordinary shares had been issued and fully paid-up.
      The principal activity of Ripro is investment holding.

4. SALIENT TERMS OF THE SHAREHOLDERS’ AGREEMENT
      4.1 Equity Shareholding
Name of Shareholder
No. of shares
% of shareholding
Palmington
1
50
Ripro
1
50
      4.2 Composition of the Board
        The Board of Directors of TNC shall comprise of at least two (2) directors and not more than six (6) directors. For the time being Palmington and Ripro agree that there shall be four (4) directors nominated by both parties, in the following proportion:-

        Name of Shareholder
        No. of Directors
        Palmington
        2
        Ripro
        2
      4.3 Shareholders’ Meeting
        The quorum for all meetings of the shareholders shall be two (2) shareholders comprising of at least one (1) shareholder representing each party. If within half an hour of the time appointed for the convening of a general meeting the quorum specified is not present, the meeting shall be adjourned to fourteen (14) days from the date of the general meeting at the same time and same place. At any adjourned meeting, the quorum required shall be any two (2) shareholders.
      4.4 Project Funding
        The NewCo may obtain financing from a financial institution for the purpose of the acquisition of the Property and the said Development and for that purpose, to pledge or charge its assets as security for such borrowing. Where shareholders’ guarantee is required, Palmington and Ripro shall provide the corporate guarantee for their respective pro-rated liabilities, according to their shareholding in the NewCo.

        Where it is or become necessary or expedient for the shareholders to make advances to the NewCo for the purpose of the acquisition of the Property and the said Development, all advances shall be pro-rated in accordance with their respective shareholdings in the NewCo.

5. RATIONALE

The entry into the Shareholders’ Agreement is in favour of Palmington as the said Development complements with the existing Pearl City project undertaken by Palmington which is also in line with the Group’s strategy to provide a conducive environment in Pearl City which are complemented with entertainment, lifestyle, healthcare and education.
      In the future,Palmington shall also benefited from sharing the potential earnings of the said Development.

6. SOURCE OF FUNDS
      The preliminary cost is financed via internally generated fund.

      Further funding for the acquisition of the Property and the said Development shall be raised by the NewCo according to the Project Funding Clause specified in the Shareholders’ Agreement.

7. FINANCIAL EFFECTS
      The entry into a Shareholders’ Agreement will not have any material effect on Tambun Indah Group’s earnings per share, net assets per share, gearings, share capital and substantial shareholdings structure for the financial year ending 31 December 2013.

8. SHAREHOLDERS’ APPROVAL

      The entry into a Shareholders’ Agreement is not subject to approval of the shareholders of Tambun Indah.

9. DIRECTORS', MAJOR SHAREHOLDERS' AND/OR PERSONS CONNECTED
      Save for common directorships, none of the directors, major shareholders of Tambun Indah and/or persons connected with them have any interest, either direct or indirect in the said transaction.

10. STATEMENT BY THE BOARD OF DIRECTORS

      The Board of Directors of Tambun Indah, after taking into consideration of the above rationale is of the opinion that the transaction is in the best interest of the Company.

11. PERCENTAGE RATIO

      The highest percentage ratio applicable to the said transaction pursuant to paragraph 10.02(g) of the Listing Requirements of Bursa Malaysia Securities Berhad is negligible.

12. DOCUMENTS AVAILABLE FOR INSPECTION

      The Shareholders’ Agreement will be available for inspection at the Registered Office of Tambun Indah at 51-21-A Menara BHL Bank, Jalan Sultan Ahmad Shah, 10050 Penang during normal business hours from Monday to Friday (except public holidays) for a period of three (3) months from the date of this announcement.
    This announcement is dated 28 May 2013.