2. KDRM Contract or : The development, installation, commissioning,

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1 Principal Terms and Conditions of the Proposed MCP/MMTN 1. Issuer : EKOM. 2. KDRM Contract or the Contract 3. Other Government Contracts : The development, installation, commissioning, implementation and maintenance of the computer system network for KDRM under the Contract, awarded to EKOM by the Government. : Other Government contracts include any future contracts from the provisioning, installation, integration, commissioning and maintenance of information technology products and related services awarded by the federal government, acceptable to the Facility Agent and the Sha riah Adviser. The Other Government Contracts shall not be for the purposes listed under the National Bond Market Negative List released on 23 October 2002 (and/or any amendments/revisions thereafter). 4. NASCOM Contract : The supply of computers to NASCOM through Daya Minda and SKKPJ. 5. Arranger : MIMB. 6. Facility, Issuing, Paying & Security Agent : MIMB. 7. Amount/Type : RM100.0 million Murabahah Commercial Paper ( MCP ) and Murabahah Medium Term Note ( MMTN ) Programme, comprising MCP Facility of u p to RM80.0 million and MMTN facility of up to RM100.0 million (hereinafter referred to as the Programme while the MCP and the MMTN shall collectively be referred to as the MCP/MMTN Notes ) comprising: Tranche I - RM70.0 million; and Tranche II - RM30.0 million. 1

2 Tranche I and II of the MCP/MMTN Programme will be issued simultaneously. The MCP shall be fully underwritten up to RM80.0 million while the minimum level of subscription fot the MMTN shall be maintained at 50% of each MMTN issuance throughout the tenor of the Programme. The MCP/MMTN Notes will be issued on a continuous basis in negotiable bearer form. The MCP will be issued on a discounted basis while the MMTN will be issued as Fixed Rate Notes. 8. General Description Of the Issuance Concepts : The Issuer may at any time during the tenor of the Programme sell certain specified assets by offering the asset for tender to a Tender Panel Member or by private placement to purchasers. The tender will be co-ordinated by the Facility Agent. The successful Tender Panel Members/purchasers shall first purchase and pay the Purchase Price to the Issuer. The successful Tender Panel Members/purchasers shall immediately thereafter re-sell the asset to the Issuer at the Purchase Price plus profit ( the Selling Price ) evidenced by the issuance of MCP or MMTN. For MCP, the Selling Price shall be paid on the relevant maturity dates for each issue. For MMTN, the Issuer s obligations to pay the Selling Pri ce shall be over a deferred period and evidenced by the issuance of Primary and Secondary Notes. 9. Purpose : Tranche I - i) To part finance the Contract; and ii) To refinance EKOM s existing bridging facilities in relation to the Contract. Tranche II - To part finance the NASCOM Contract* up to a margin of finance of 43%. * Upon the expiry of the NASCOM Contract, Tranche II shall be used to part-finance the Other Government Contracts up to a margin of finance of 43%. 2

3 10. Security : The Programme shall be secured by the following arrangement:- i) An assignment of all contractual rights of EKOM under the Contract, NASCOM Contract and the Other Government Contracts, including the rights to all proceeds under the Contract, NASCOM Contract and Other Government Contracts. ii) A charge over three (3) Designated Accounts (with a bank acceptable to MIMB), namely a Proceeds Account, a Finance Service Reserve Account and a Sinking Fund Account, which also covers all monies earned through placement/investment of proceeds and monies standing to the credit of EKOM in relation to the Contract, NASCOM Contract and Other Government Contracts. In connection with the above, EKOM shall give an irrevocable instruction in writing to and procure the acknowledgement of the Government/ Customer(s) to remit all proceeds under the Contract/NASCOM Contract/Other Government Contracts directly into the Proceeds Account. iii) An assignment of all rights of EKOM over any maintenance/performance bonds and other security deposits issued or provided in favour of EKOM (if any) in relation to the Contract, NASCOM Contract and Other Government Contracts. iv) An assignment of all insurances of EKOM procured in relation to the Contract, NASCOM Contract and Other Government Contracts. v) Corporate Guarantee from Edaran Digital Systems Berhad. 3

4 11. Tenor of the MCP/MMTN : Five (5) years (60 months) from the date of first issue. Tranche I and II of the MCP/MMTN Programme will be issued simultaneously. The MCP/MMTN shall be settled in accordance with the following Reduction Schedule:- (a) Reduction Schedule Months Amount to be Outstanding Calculated From Settled Limit After the Date of First (RM Million) Settlement Issue (RM Million) Tranche I Tranche II Nil Total or, (b) On the maturity dates of any issues of the Programme at the discretion of the Issuer, whichever is earlier. 12. Trustee 13. Syariah Adviser : Pacific Trustees Berhad. : Dr. Mohd Daud Bakar. 14. Tender Panel Member ( TPM ) : The TPM shall be made up of eligible corporations/institutions falling within any of the categories of persons specified in Section 4(6) of the Companies Act, 1965 (as amended) and as selected by the Issuer and the Issuing Agent. The compositio n of the TPM may be varied from time to time at the discretion of the Issuing Agent in consultation with the Issuer. All TPMs must be members of the Fully Automated System for Tendering ( FAST ). 15. Underwriters for MCP: Affin Discount Berhad RM50.0 million MIMB RM30.0 million 4

5 16. Underwriting Fee for MCP : Rating Fee P % p.a. P2 0.50% p.a. P3 0.75% p.a. The Underwriting Fee shall be payable in advance before or on the date of first issue and thereafter on the anniversary dates of first issue. 17. Underwritten Yield for M CP : Rating Yield P1 0.50% p.a. plus simple average of the underwriters COFs. P2 0.75% p.a. plus simple average of the underwriters COFs. P3 1.00% p.a. plus simple average of the underwriters COFs. For purpose of determining the Underwritten Yield, COFs of underwriting banks shall be applied. 18. Underwriting Commitment For MCP : The Underwriters severally commit to purchase the MCP not taken up by the TPM at the Underwritten Yield, pro-rated to their underwriting commitments. 19. Availability : Upon completion of documentation and compliance of relevant predisbursement conditions and/or other conditions to the satisfaction of the Facility Agent. In any case, based on the latest SC s Guidelines, the first drawdown under the MCP/MMTN Programme must be effected within six (6) months from the date of the SC s approval. 5

6 20. Drawdown : Drawdown shall be made against the following:- i) Invoices/bills and/or documentary evidence on goods supplied/works done in relation to the Contract/NASCOM Contract/Other Government Contracts to the satisfaction of the Facility Agent; ii) Redemption statement and undertaking to discharge securities given in respect of the existing bridging facilities in relation to the Contract; and/or iii) KDRM s/nascom s/government s written confirmation /verification /approval (if applicable) in relation to the above item (i). All disbursements shall be made directly to the respective payees and/or to the Proceeds Account. 21. Designated Account s : EKOM is required to open/maintain the following three (3) income bearing accounts with a bank acceptable to the Facility Agent as follows:- Proceeds Account; Finance Service Reserve Account ( FSRA ); and Sinking Fund Account ( SFA ). Proceeds Account All proceeds from the Contract/NASCOM Contract/Other Government Contracts shall be remitted into the Proceeds Account which shall be jointly operated by EKOM and the Facility Agent. A fixed percentage of the contract proceeds received in the Proceeds Account shall be transferred into the FSRA to maintain a sum equivalent to the succeeding six (6) months profit accruing on the MCP/MMTN Notes and the balance for onward transfer to the SFA for the purpose of redeeming the principal repayments. The fixed percentage which shall be applied to the contract proceeds is as follows: 6

7 The Contract Months Calculated From The Date of First Issue Fixed Percentage Out of Contract Proceeds st 1 to 24 month 10.0% 25 th to 36 th month 15.0% NASCOM Contract Months Calculated From Fixed Percentage Out The Date of First Issue of Contract Proceeds 1 st to 36 th month 1.5% Upon enforcement of the security, the noteholders shall have priority in respect of any amount outstanding to the credit of the said account, followed by other creditors of EKOM. Funds credited into the Proceeds Account will be applied in the following order of priority :- a) Capital expenditure associated with the Contract/NASCOM Contract/Other Government Contracts; b) Payment to suppliers/vendors/relevant party for system supplied/works done in relation to the Contract/NASCOM Contract/Other Government Contracts; c) EKOM s office overheads including staff salaries, wages and employment costs associated with the Contract/NASCOM Contract/Other Government Contracts; d) Payment of taxes in respect of the Contract/NASCOM Contract/Other Government Contracts; e) Insurances for the Contract/NASCOM Contract/Other Government Contracts (if any); f) Consultants and advisers to EKOM in respect of the Contract/NASCOM Contract/Other Government Contracts; g) The profit portion and redemption of MCP/MMTN, or if required pursuant to the Reduction Schedule, if the Issuer so determines; h) Contribution to the FSRA and SFA; 7

8 i) Repurchase of the MCP/MMTN, at the discretion of the Issuer; j) Permitted Investments; k) Permitted distributions to the Issuer s shareholders; and l) Other incidental costs (associated with the Contract/NASCOM Contract/Other Government Contracts) which are acceptable to the Facility Agent. Disbursements from this account shall be made against the following:- i) Invoices/bills and/or documentary evidence on goods supplied/works done in relation to the Contract/NASCOM Contract/Other Government Contracts to the satisfaction of the Facility Agent; and/or ii) KDRM s/nascom s/government s written confirmation /verification /approval (if applicable) in relation to the above item (i). Finance Service Reserve Account ( FSRA ) The FSRA shall be jointly operated by EKOM the Facility Agent. and Contributions to the FSRA captured from the transfer of the fixed percentage of the contract proceeds from the Proceeds Account will be credited progressively to the FSRA commencing six (6) months from the date of first drawdown until the balance is equivalent to the succeeding six (6) months of profit portions. The remaining balance of the contract proceeds will be onward transferred to the SFA for the purpose of principal repayments. In any event, the FSRA balance equivalent to the succeeding six (6) months of profit portions must be maintained at all times during the subsistence of the Programme. The respective sums shall be fully deposited six (6) months before the respective due dates. 8

9 The Issuer may only withdraw sums from the FSRA for the payments of Profit Portion of the MCP/MMTN and other outstanding payment due under these facilities. Sinking Fund Account ( SFA ) The SFA shall be jointly operated by EKOM and the Facility Agent. Contributions to the SFA captured from the transfer of the balance of the fixed percentage of the contract proceeds from the FSRA will be credited progressively to the SFA. EKOM shall make contributions into the SFA in the event there is any shortfall in the SFA to meet the next principal repayment six (6) months prior to repayment date based on the Reduction Schedule. The Issuer may only withdraw sums from the SFA for the following payments:- i) Towards the payment of the principal of the MCP/MMTN based on the Reduction Schedule and other outstanding payment due under these facilities; and ii) For the repurchase of the MCP/MMTN. 22. Right to make Permitted Investments : The Issuer shall be permitted from time to time to utilise funds held in the Designated Accounts to make Permitted Investments, provided that such funds utilised for Permitted Investments shall be remitted to the Designated Accounts in a timely manner to meet any payment obligations of the Issuer when due and payable. Permitted Investment shall be investments as approved from time to time by the Syariah Advisory Council of the Securities Commission. Permitted Investments means:- i) Deposits in income bearing accounts and negotiable certificates of deposits issued by licensed financial institutions and/or discount houses; ii) Bonds, treasury bills or finance instruments issued by the Government; or 9

10 iii) Other finance or capital market instruments of private entities having, a) A maturity date to match the utilisation of the monies and being denominated in Ringgit Malaysia; and b) In the case only of investments of the type referred to in this paragraph (iii), rating of AA and P1 (or its equivalent) as determined by RAM or MARC or a recognised rating agency or such other higher rating as is capable of being issued by the said rating agencies from time to time. 23. Mode of Issuance : MCP Via competitive tender on FAST, prospectus to the TPMs. without MMTN Non-tender on private placement basis, to be reported on FAST. 24. Listing Status : The MCP/MMTN Notes shall not be listed on The Kuala Lumpur Stock Exchange and shall be issued without prospectus. 25. Maturity Period of the MCP/MMTN Notes : The Issuer shall have the option to issue MCP or MMTN, subject to the availability of funds for the relevant maturity period elected by the Issuer. i. MCP One (1), two (2), three (3), six (6), nine (9) months or such other period not exceeding 365 days at the Issuer s option. ii. MMTN Any maturity from one (1) year and above to five (5) years at the Issuer s option. The maturity date of any MCP/MMTN Notes must be such that they do not mature beyond the tenor of the Programme. 10

11 26. Status and Form of the MCP/MMTN Notes : i. The MCP Notes and MMTN Notes (Primary and Secondary Notes, if any) will constitute direct, unconditional and secured obligations of the Issuer and will at all times rank above all other present and future unsecured and unsubordinated indebtedness or other obligations of the Issuer, except for indebtedness preferred by mandatory provisions of law. ii. The MCP will be non-profit bearing in bearer form issued at a discount to nominal value. iii. The MMTN will be profit bearing, in bearer form issued at par. 27. Denomination of MCP/MMTN Not es : The MCP/MMTN Notes shall be issued in denomination of RM1,000,000 each. 28. Purchase & Selling Prices for MCP : Sellin g Price Nominal value of the MCPs payable on the relevant maturity date for each issue. Purchase Price The Purchase Price payable by the successful TPM shall be calculated in accordance with the following formula:- Purchase Price = SP [1 R x T ] where :- SP = Selling Price of the assets R T = Desired profit (%) per annum at which the offer was accepted (expressed to three decimal places). = Number of days in the tenor of the MCP Notes (which shall include the Issue Date of the MCP Notes but shall exclude the Maturity Date of the MCP Notes). 11

12 29. Purchase & Sell ing Prices for MMTN 30. Purchases & Cancellation : The Issuer s obligations to pay the Selling Price shall be over a deferred period and evidenced by the issuance of Primary and Secondary Notes. The Notes shall be redeemable on their respective maturities. : The Issuer may at any time purchase the MCP/MMTN Notes in the open market at any time by private treaty. The MCP/MMTN Notes purchased will be cancelled and may not be resold or reissued. 31. Redemption : The Issuer shall redeem in full the subscription/issuing amount by redeeming at par (for non-profit bearing MCP Notes) and par value plus profit (for MMTN Notes) on the relevant maturity date(s) of the respective Notes. 32. Allocation : The MCP/MMTN Notes will be allocated to TPM in order of ascending yield, subject to the acceptance of the Issuer. 33. Selling Restrictions : The MCP/MMTN Notes shall not be issued, offered for subscription or purchase, nor can any invitation to subscribe for or purchase the MCP/MMTN Notes be made to persons other than persons whose ordinary business is to buy or sell shares or debentures whether as principal or agent falling within any one of categories of persons specified under Section 4(6) of the Companies Act, 1965 (as amended). 34. Tendering System : The tendering system shall be governed by the Rules on FAST for Private Debt Securities ( PDS ) issued by BNM. 35. Underwriters : The MCP will be fully underwritten by eligible institutions, while the MMTN will be issued on a best effort basis. (Note:- Based on the SC s Guidelines in respect of issuance with no underwriting arrangement, the issuer must state the minimum level of subscription necessary to achieve the funding objective of the issuer. 12

13 Unless otherwise allowed in writing by the SC, where any issue, offer or invitation is under- level of subscribed and cannot meet the minimum subscription, the issue, offer or invitation must be aborted and any consideration received for the purposes of subscription, where applicable, must be immediately returned to all subscribers) 36. Statutory Approval : The availability of the Programme is subject to the approval of the SC and other relevant authorities (if any). 37. Delivery & Depository : The MCP/MMTN Notes shall be deposited with the Authorised Depository and physical delivery of the MCP/MMTN Notes will not be permitted. 38. Authorised Deposito ry : The MCP/MMTN Notes will be deposited with MIMB as an Authorised Depository approved by BNM and a Safe Custody Receipt ("SCR") shall be issued to Noteholders. Physical delivery of the Notes shall not be permitted. 39. Compensation for late payment : In the event of overdue payment of any amounts due under the MCP/MMTN, the Issuer shall pay to the Noteholders compensation on such overdue amount at the rate and manner prescribed by Syariah Advisory Council of the SC. 40. Conditions Preceden t : To include but not limited to the following:- (i) All necessary legal documentation shall have been completed in form and substance acceptable to the Facility Agent and/or the solicitors to the legal documentation. (ii) The solicitors to the documentation shall have confirmed that:- (a) the Programme and the creation of the security documents will not constitute a breach by the Issuer of any limit imposed by its Memorandum and Articles of Association on its borrowing powers; (b) the Programme Agreement and all other documents pertaining to the Programme shall have been duly approved, authorised, executed and have been presented for registration with the relevant authorities; 13

14 (c) the relevant searches, including the company search, winding-up search and bankruptcy search have been conducted and perused by the solicitors; (d) the relevant legal documents are in order, enforceable and binding on all parties; and (e) all the Conditions Precedent have been met and all necessary approvals have been given and search have been conducted and perused by the solicitors. (iii) Receipt by the Facility Agent of the following:- (a) Certified true copy of all contract(s)/agreement(s) (including the Letter of Awards of KDRM, Daya Minda and SKPPJ) executed between the Issuer and the relevant Government agency pertaining to the Contract/NASCOM Contract/Other Government Contracts; (b) Letter of Acknowledgement from the relevant Government agency and NASCOM pertaining to the assignment of contract proceeds; (c) Certified true copy of the Issuer s and EDARAN s Memorandum & Articles of Association and other statutory forms as may be required by the solicitors to the documentation; (d) Certified true copy of the Issuer s Board of Directors Resolution accepting the Programme and appointing authorised signatory(ies) to accept and to operate the Programme; (e) Certified true copy of EDARAN s Board of Directors Resolution authorising the corporation guarantee; (f) Certified true copies of the Issuer's Forms 24 and 49 and any other statutory forms as may be required by the solicitors to the documentation; (g) Specimen signatures of the Issuer s respective authorised signatories; 14

15 (h) Certified true copies of documents considered necessary by the Facility Agent and its legal counsel; and (i) Certified true copies of all insurance policies in form and substance acceptable to MIMB in relation to the Contract/NASCOM Contract/Other Government Contracts (if any). (iv) The Programme shall be subject to the prior approval of SC and/or other relevant authorities (if any), and shall also be at all times governed by guidelines issued and to be issued from time to time by the SC or any other authorities having jurisdiction over matters pertaining to the Programme. (v) All other necessary approvals for the Programme shall have been obtained, including governmental approvals. (vi) The MCP/MMTN Notes shall be rated by RAM and all costs and expenses incurred thereto shall be borne by the Issuer. The rating shall be as follows:- MCP A minimum rating of P3 by RAM. MMTN A minimum rating of A3 by RAM. (vii) All documents evidencing the establishment of the Designated Accounts. (viii)all outstanding fees due shall have been settled. (ix) Any other conditions as may be advised by the solicitors to the documentation. 41. Financial Covenants : i. The debt to equity ratio of EKOM must not exceed the ratio of 4.25 : 1 during the subsistence of the MCP/MMTN. The debt to equity ratio is defined as the ratio of the total borrowings with financial institutions to the aggregate of the ordinary shares, loan stock and retained earnings of EKOM. 15

16 The above ratio shall be measured based on the management accounts/audited accounts and reported i) ii) at the point of each issue; and/or upon full utilisation of the MCP/MMTN Programme, annually on the anniversary of the Programme Agreement. ii. Finance Service Coverage Ratio ( FSCR ) of at least 1.25 times. The FSCR is defined as the ratio of cumulative Available Cashflow to the Issuer s finance service obligations pursuant to the redemption schedule under the MCP/MMTN during the previous twelve (12) months. The Available Cashflow shall be defined as:- a. All income or any other receipts of capital or revenue received by EKOM under the Contract/NASCOM Contract/Other Government Contracts ; b. Value of the Permitted Investment and return on Permitted Investment received by EKOM; c. Cash in the Designated Accounts at the end of the relevant financial year; and d. Proceeds of insurance claims (if any). Less: a. The total amount spent on management, administration, operation, maintenance and heavy repairs; b. Tax paid; c. Capital expenditure incurred; and d. Any payments made by EKOM under the Contract/NASCOM Contract/Other Government Contracts. The FSCR shall be measured annually commencing on 30 June 2002 and to be duly audited by EKOM s auditors. 16

17 42. Principal Covenants : Including but not limited to the following :- Affirmative (a) To provide details of any litigation, arbitration or administrative proceeding or claim, or the occurrence of any other event, which might by itself or together with any other such proceedings, claims or events materially and adversely affect the ability of the Issuer to perform its obligations under the Facility Documents. (b) To provide notification of all claims made against EKOM and to defend itself against such claims and not settle such claims except with the prior written consent of the Facility Agent. (c) To provide such financial or other information as the Facility Agent may reasonably require. (d) To provide the Facility Agent with joint inspection exercise(s) on the sites as well as to inspect all relevant documents, books, records, machinery or equipment used for or in relation to the Contract/NASCOM Contract/Other Government Contracts. (e) To conduct transactions with any of its affiliates on an arm s length basis. (f) To give notice on any Event of Default. (g) To comply with all regulations. relevant laws and (h) To provide quarterly, half-yearly management financial statements within sixty (60) days of each half year end and year end audited financial statements within one hundred and twenty (120) days of the fiscal year end. (i) To deliver to the Facility Agent within thirty (30) days of the end of each monthly period a summary report on the progress of the Contract/NASCOM Contract/ Other Government Contracts and also to provide such information and details as shall be required by the Facility Agent from time to time. 17

18 (j) To preserve and maintain in full force and effect all consents, licences and rights necessary for the conduct of its business. (k) To maintain the required minimum rating of A3/P3 from RAM, including providing any necessary credit enhancement satisfactory to RAM to maintain such a rating. (l) Disclosure of Information The Trustee/Facility Agent shall be entitled at its discretion and the Issuer hereby irrevocably consents to and authorises the Trustee/Facility Agent to furnish from time to time such information on the Facility and the provisions hereof and on the other Security Documents as the Trustee/Facility Agent may deem fit to : (i) The pledgor, or any guarantor or surety or other party providing any security for the repayment of the Facility or otherwise in connection therewith; (ii) The CENTRAL CREDIT UNIT ( CCU ), CENTRAL CREDIT REFERENCE INFORMATION SYSTEM ( CCRIS ) and/or bureau or agencies approved by the BNM, the Association of Merchant Banks in Malaysia or such persons, firms or companies, as the case may be, for the purpose of compliance with any of their directives or instructions (whether or not having the force of law) and/or to perfect preserve or enforce any rights or interests of the Trustee/Facility Agent including without limitation to the generality of the foregoing for the purpose of recovering indebtedness. (iii) Underwriters, TPMs as well as the Facility Agent s related companies. 18

19 (m) The Issuer undertakes that it will not, save with the prior approval of Trustee/Facility Agent, which approval shall not be unreasonably withheld by the Trustee/Facility Agent, permit any change in the shareholding structure of EKOM, save as permitted by the Government. (n) The Issuer shall within thirty (30) days notify the Trustee/Facility Agent of any change in its directors and/or key management. (o) The Issuer shall take out and maintain the necessary insurance policies (during the periods in which such policies are relevant) and promptly notify of any event which will or may give rise to any claim or right of action under the insurance policies in relation to the Contract/NASCOM Contract/Other Government Contracts (if any). (p) All other affirmative covenants facility of this nature. similar to a Negative (a) The Issuer shall not without prior written consent of the Trustee/Facility Agent (which consent shall not be unreasonably withheld):- (i) Carry out any other business or activities other than the authorised business or activities in accordance with the exercise of its rights and performance of its obligations under the Contract/NASCOM Contract/ Other Government Contracts. (ii) Cancel, transfer, surrender, relinquish or otherwise amend the relevant agreement in any way which has material adverse effect on its rights, interest and benefit over the Contract/NASCOM Contract/ Other Government Contracts. (iii) Take any action or fail to perform any duty which will cause or lead or contribute to a breach, revocation or termination of the Contract/NASCOM Contract/Other Government Contracts. 19

20 (iv) (v) (vi) Dissolve its affairs or consolidate with or merge into any other entity. Reduce its paid-up share capital. Sell, transfer, assign or otherwise dispose of all or substantial portion of its assets, property, undertaking and subsidiaries. (vii) Change its Memorandum Association. & Articles of (viii) Amend, vary or supplement any of the Facility Documents. (ix) Extend loans and advances to directors, shareholders, related or associated companies exceeding RM1.0 million at any one time or issue guarantees of the same or make investments in other companies, subsidiaries or associates (other than normal trade credit or trade guarantees or temporary loan to staff, customers, contractor/developer or suppliers in the ordinary course of business). (x) For a period of 42 months commencing from the first issuance of the Notes, incur, assume, guarantee or permit to exist any indebtedness except for :- existing borrowings; this MCP/MMTN Facility; a credit facility in the region of RM6.0 million to finance the acquisition of a piece of industrial land in Cyberjaya; hire-purchase financing up to a maximum sum of RM5.0 million at any one time; inter-company borrowings as and when deemed necessary for the ordinary course of business; and 20

21 suppliers' credit, trade creditors advances incurred or obtained in the ordinary course of the Issuer's business. (xi) (xii) Offer to create any charge, debenture (whether fixed or floating), mortgage, pledge, lien or any encumbrances of whatsoever nature or description over any of its assets, properties both present or future or any part thereof as security for any loan or other indebtedness now existing and/or which may hereafter be incurred or assumed by the Issuer. Declare or make payment of any dividend on share capital exceeding RM2.0 million a year and/or income on subordinated advances/loan stocks:- If the FSCR is less than 1.25 times or would be if recalculated immediately after payment of any dividend; If the debt to equity ratio is more than 4.25 times; If EKOM fails to adhere to the contribution schedules under the FSRA; and If any Event of Default has or is continuing. occurred (xiii) Make any principal repayment in respect of any subordinated advances and loan stocks. (xiv) Open any account other than the Designated Accounts in relation to the Contract/NASCOM Contract/ Other Government Contracts. (b) All other negative covenants similar to facility of this nature, as advised by the solicitors. 21

22 43. Repres entations and Warranties : Representations and warranties typical for a facility of this nature, as advised by the solicitors. 44. Events of Default : Events of default typical for a facility of this nature including but not limited to failure to redeem the MCP/MMTN Notes, non-payment of profit and breach of representations, warranties and covenants. 45. Clear Market Provision : The Issuer shall agree not to enter the market for any kind of loan, note or bond issue in which it is the borrower/debtor or guarantor, save in the ordinary course or business, from the date of acceptance of this offer until the signing date of legal documents, unless it has obtained the Arranger's prior written consent. 46. Indemnity : The Issuer shall indemnify the Arranger against all liabilities, claims, actions, demands, losses, costs, charges and expenses which the latter may suffer or incur and which result from or are attributable to any breach of any representation or warranty given by the Issuer or arising from any non-compliance with regulatory requirements. 47. Taxation : All payments by the Issuer in connection with the Notes shall be made free and clear of all and without deductions for all present and future taxes, duties, levies or withholdings of whatever nature. 48. Documentation : Completion of all documentation for the Programme which include inter-alia the following documents:- (a) Programme Agreement; (b) Tender Panel Agreement; (c) (d) Agency Agreement; Depository Agreement; (e) Trust Deed; (f) Security Documents; and (g) Any other documents/clauses which are standard for a facility of this nature as advised by the solicitors. 49. Fees & Expenses : All legal and incidental expenses including all other fees and expenses in connection with the preparation and submission of the Programme to the relevant authorities for approval shall be for the account of the Issuer. 50. Governing Law : Laws of Malaysia. 22