Selangor Darul Ehsan

Transcription

1 Corporate Information of Issuer (1) Name Perbadanan Kemajuan Negeri Selangor ( PKNS or Issuer ) (2) Address Ibu Pejabat, Laman PKNS No.2, Jalan Indah 14/8 Seksyen 14, Shah Alam Selangor Darul Ehsan (3) Date of incorporation 6 August 1964 (4) Place of incorporation Selangor (5) Whether registered with Companies Commission of Malaysia (CCM) (6) Business registration number No Not applicable as PKNS is a body corporate incorporated under the Selangor State Development Corporation Enactment 1964 (the Enactment ) (7) Residence status Not applicable as PKNS is a body corporate incorporated under the Enactment (8) Place of listing, if applicable (9) Date of listing, if applicable (10) State if the issuer is a Malaysian government-linked company Not applicable Not applicable Not applicable (11) Industry sector of the issuer Property development (12) Principal activities The Issuer s principal activities encompass the following:-

2 2 (i) to promote residential, industrial and commercial development of areas in the State of Selangor ( Selangor State ) designated for this purpose; (ii) (iii) to do all such other matters and things necessary for the exercise or performance of all or any of the functions and duties of PKNS; to act as a local authority in areas outside local authorities if so authorised in accordance with any written law; (iv) to promote, stimulate, facilitate and undertake industrial, social, commercial and economic development and activities in Selangor State; and (v) to promote, stimulate, facilitate and undertake agricultural development or housing development in Selangor State. (13) Principal activities of issuer s subsidiaries, where applicable (14) If the issuer is a special-purpose vehicle company (SPV), state the name of the entity that established it (15) Authorised, issued and paid-up capital (16) Structure of shareholdings and names of shareholders or, in the case of a public company, names of all Please refer to Annexure B hereto Not applicable Not applicable as PKNS is a body corporate incorporated under the Enactment Not applicable as PKNS is a body corporate incorporated under the Enactment

3 3 substantial shareholders (17) Ultimate shareholders Not applicable as PKNS is a body corporate incorporated under the Enactment (18) State if issuer is a related corporation of any Malaysian publiclisted company (PLC) (19) Board of directors, including (a) National Registration Identity numbers Malaysian directors; and Card for The Issuer is not a related corporation of any Malaysian public listed company Not applicable as PKNS is a body corporate incorporated under the Enactment. Its affairs are directed by its members. As at 31 March 2017, the composition of the members of PKNS ( Members of PKNS or Members ) are as follows:- No Name NRIC No 1. Y.A.B. Dato Seri Mohamed Azmin bin Ali 2. Y.B. Dato Mohd. Amin bin Ahmad Ahya 3. Y.B. Dato Noordin bin Sulaiman 4. Y.Bhg. Tuan Haji Mas Abdul Rahman bin Mas Mohamed 5. Y.B. Dato Teng Chang Khim 6. Y.B. Dato Iskandar bin Abdul Samad 7. Y.Bhg. Datuk Seri Hashmuddin bin Mohammad 8. Y.B. Tuan Shamsul Yusre bin Mohd Akin 9. Y.Bhg. Datuk Ahmad Badri bin Mohd. Zahir Y.Bhg. Dato Mohd

4 4 Salleh bin Mahmud 11. Y.Brs. Dr. Maziah binti Che Yusof (b) passport numbers for non-malaysian directors (20) Name, designation and contact details of the contact person of the issuer Not applicable Azlina binti Jaapar Chief Accountant (Account) ext 1150 Ahmad Zailani bin Mohamad Ali Chief Accountant (Treasury) ext 1180 Elliza binti Roslan Accountant ext 1151 (21) Name, designation and contact details of the contact person of the key management personnel of the issuer Puan Hajah Nor Azlina binti Haji Amran Chief Finance Officer ext 1148 Tuan Haji Azhar bin Ahmad General Manager (Finance) ext 1179 (22) Disclosure of the following: (a) If the issuer or its board members have been convicted or charged with any offence under any securities laws, corporation laws or other laws involving fraud or dishonesty in a court of law, or if None

5 5 any action has been initiated against the issuer or its board members for breaches of the same, for the past 10 years prior to the lodgement/ since incorporation (for issuer incorporated less than 10 years); and (b) If the issuer has been subjected to any action by the stock exchange for any breach of the listing requirements or rules issued by the stock exchange, for the past five years prior to the lodgement (23) Any other material information Not applicable as the Issuer is not a listed company None

6 Parties to the Transaction Names of all parties involved in the lifecycle of the corporate bonds or sukuk (i.e. origination, at the point of distribution and after distribution), including their roles and responsibilities. (A) At the point of origination Roles Names of Parties Responsibilities (i) Issuer PKNS To review, comment and approve the due diligence planning memorandum ( DDPM ), the submission to the Shariah Advisory Council of the Securities Commission Malaysia ( SC ) for its endorsement ( SAC Submission ), the lodgement form as required under the SC s Guidelines on Unlisted Capital Market Products under the Lodge and Launch Framework first issued by the SC on 9 March 2015 and revised on 16 January 2017 (as amended from time to time) ( LOLA Guidelines ) ( Lodgement Kit ), the replacement information memorandum ( Replacement IM ) and the supplemental agreements to the existing Transaction Documents (as defined in paragraph (22) of Section 1.03 below) relating to the Sukuk Murabahah Programmes (as defined in paragraph (1) of Section 1.03 below) following the Proposed Upsizing (as defined in paragraph 33 (xii) of Section 1.03 below);

7 7 (ii) Principal Adviser / Lead Arranger AmInvestment Bank Berhad ( AmInvestment Bank ) (iii) Solicitors Messrs. Albar & Partners, counsel to the Principal Adviser and Lead Arranger To appoint relevant professionals and/or experts in connection with the Sukuk Murabahah Programmes; To accept and agree to the final terms of the Sukuk Murabahah Programmes following the Proposed Upsizing; and To execute the supplemental agreements to the existing Transaction Documents in respect of the Proposed Upsizing. To coordinate and review all relevant documentation in relation to the SAC Submission, the Lodgement Kit, the Replacement IM and the supplemental agreements to the existing Transaction Documents. To coordinate the work of other professional advisors involved in the documentation required for the Sukuk Murabahah Programmes following the Proposed Upsizing. To manually submit/lodge the SAC Submission and Lodgement Kit to/with the SC on behalf of the Issuer. To act for the Principal Adviser/Lead Arranger in conducting the legal due diligence review in connection with SAC Submission, the Lodgement Kit and the Replacement IM based on the scope as

8 8 outlined in the DDPM; To act for the Principal Adviser/Lead Arranger in connection with attending to the drafting and finalising of the SAC Submission, the Lodgement Kit and the Replacement IM; To act for the Principal Adviser/Lead Adviser in attending to the drafting, negotiation, execution and where relevant stamping and/or registration of the supplemental agreements to the existing Transaction Documents and to advise the Principal Adviser/Lead Arranger on legal matters and to attend to matters incidental to the preparation of the aforesaid supplemental agreements; (iv) Shariah adviser Datuk Dr. Mohd Daud Bakar ( Shariah Adviser ) To advise on Shariah-related matters in relation to the terms and structure of the Sukuk Murabahah Programmes following the Proposed Upsizing; To review the SAC Submission, the Lodgement Kit and the supplemental agreements to the existing Transaction Documents and advise on Shariah-related matters; and To issue a Shariah pronouncement in relation to the Sukuk Murabahah Programmes following the Proposed Upsizing.

9 9 (v) Trustee MTrustee Berhad (formerly known as AmTrustee Berhad) ( MTrustee ) To provide comments and feedback on the supplemental agreements to the existing Transaction Documents insofar as it related to its capacity as Trustee. (B) At the point of distribution Roles Names of Parties Responsibilities (i) Issuer PKNS To execute the relevant supplemental agreements to the existing Transaction Documents relating to the issuance of the Sukuk Murabahah (as defined in paragraph 1.03(1) below) and to deliver issue request(s) to the Facility Agent for the issuance of the Sukuk Murabahah. To agree on the appropriate presentation to potential investors and attend meetings/presentations with potential investors if required; To decide on the size of the issue, profit rate, pricing, maturity and tenure of the Sukuk Murabahah; To decide on the dissemination of the Replacement IM to potential investors; and To decide on the final allocation of the Sukuk Murabahah and acceptance of commitments.

10 10 (ii) Lead Manager AmInvestment Bank or AmInvestment Bank jointly with such other financial institution(s) as mutually agreed between AmInvestment Bank and the Issuer (iii) Facility agent AmInvestment Bank (iv) Central Depository To propose a suitable distribution strategy and to identify and approach potential investors to subscribe for the Sukuk Murabahah. To co-ordinate the marketing process and investor presentation, as the case may be, in relation to the issuance of a particular series of the Sukuk Murabahah. To advise on pricing and facilitate the settlement and issuance process. To facilitate the issuance process under the Sukuk Murabahah Programmes, which includes amongst others, attending to issue requests, calculation of profit payments and the creation of stock codes. To prepare and submit to Bank Negara Malaysia ( BNM ) the necessary forms for the issuance of the Sukuk Murabahah. BNM To act as central securities depository and custodian of the global certificates of the Sukuk Murabahah issued under the Sukuk Murabahah Programmes. (v) Paying agent BNM To carry out functions, duties and obligations under the Central Securities Depository and Paying Agency Rules issued by

11 11 Malaysian Electronic Clearing Corporation Sdn Bhd ( MyClear ). (vi) Tender Panel Members ( TPM ) Persons to whom an issue of, or an offer or invitation to subscribe the Sukuk Murabahah are made would fall within Part I of Schedule 6 or Section 229(1)(b) of Capital Markets and Services Act 2007 ( CMSA ), Part I of Schedule 7 or Section 230(1)(b) of CMSA read together with Schedule 9 or Section 257(3) of CMSA. To tender for the ICPs in accordance with the terms and conditions of the programme agreement (as amended by the supplemental programme agreement). (vii) Shariah Adviser Datuk Dr. Mohd Daud Bakar (Shariah Adviser) To advise on Shariahrelated matters in relation to the proposed utilization of issuance proceeds by the Issuer. (C) After distribution Roles Names of Parties Responsibilities (i) Issuer PKNS To make periodic profit payments and principal payments in accordance with the supplemental agreements to the existing Transaction Documents in respect of the Sukuk Murabahah Programmes; and To perform and comply with its obligations and covenants set

12 12 (ii) Principal Adviser AmInvestment Bank out in the Transaction Documents (as amended by the aforesaid supplemental agreements). To prepare and submit postissuance notice ( PIN ) to the SC, if any. (iii) Trustee MTrustee To monitor the Issuer s positive and negative covenants compliance as per the trust deed. (iv) Facility Agent AmInvestment Bank To represent the interests and rights of the holders of the Sukuk Murabahah ( Sukukholders ) in accordance with the trust deed. To notify the relevant parties or authorities, following a declaration of an event of default. Subject to instructions and indemnification by the Sukukholders, to take such steps and/or institute such proceedings to enforce payment of all amounts outstanding under the Sukuk Murabahah and payment of profit, if any. To convene and arrange for meeting(s) of the Sukukholders, as and when required. To check and verify the issue requests. To prepare and submit to BNM the necessary documents for issuance or redemption of the Sukuk Murabahah in the Real

13 13 Time Electronic Transfer of Funds and Securities ( RENTAS ) system. To complete the creation of the facility code and stock codes for the Sukuk Murabahah in the Fully Automated System For Issuing/Tendering ( FAST ). To maintain the facility code, stock codes and other necessary updates in the FAST on an ongoing basis until the Sukuk Murabahah Programmes mature. To deliver the global certificates to BNM. To receive issue proceeds of the Sukuk Murabahah from the Sukukholders and remit the same to the Issuer. To maintain ledger and records. To monitor and ensure the aggregate issuance size does not exceed the limit of the Sukuk Murabahah Programmes. To receive the profit amount and redemption proceeds from the Issuer and pay to BNM as Paying Agent for onward payment to the Scripless Securities Depository System ( SSDS ) Participants of the Sukukholders. To calculate the profit amount, accreted value/redemption proceeds, late payment charges (if any) and advise the

14 14 Issuer; To remind the Issuer of the nominal value of the Sukuk Murabahah due on the maturity dates. To monitor the payments from the Issuer to be made to BNM before the cut-off time; To liaise with and forward relevant documents to BNM during the tenure of the Sukuk Murabahah. To liaise with the Issuer on agency matters. (v) Shariah Adviser Datuk Dr. Mohd Daud Bakar (Shariah Adviser) To provide the necessary confirmation as may be required under LOLA Guidelines Details of Facility/ Programme (1) Name of facility Islamic Commercial Papers ( ICPs ) Programme of up to RM300.0 million in nominal value ( ICP Programme ) and Islamic Medium Term Notes ( IMTNs ) Programme of up to RM1.7 billion in nominal value ( IMTN Programme ) subject to a joint limit of RM1.7 billion in nominal value, based on the Shariah principle of Murabahah (via a Tawarruq arrangement). (2) One-time issue or Programme (The ICP Programme and IMTN Programme will be collectively referred to as the Sukuk Murabahah Programmes and the ICPs and the IMTNs will be collectively referred to as the Sukuk Murabahah ).

15 15 programme (3) Shariah principles (for sukuk) (4) Facility description (for ringgit-denominated sukuk, to provide description as cleared by the SC) Murabahah (via a Tawarruq arrangement) The Sukuk Murabahah Programmes comprise Sukuk Murabahah to be issued from time to time under the Shariah principle of Murabahah (via Tawarruq arrangement). The Sukuk Trustee, on behalf of the Sukukholders, and PKNS will enter into an agency agreement ( Service Agency Agreement ), pursuant to which PKNS (in such capacity, the Purchase Agent ) is appointed as the agent of the Sukukholders for the purchase and sale of certain Shariah-compliant commodities which would exclude ribawi items in the category of medium of exchange such as currency, gold and silver ( Commodities ). The Purchase Agent will then enter into a facility agency agreement ( Facility Agency Agreement ) to appoint the Facility Agent as the sub-agent of the Sukukholders (in such capacity, the Sub-Purchase Agent ) for the purchase and sale of the Commodities under the Sukuk Murabahah Programmes. Pursuant to a commodity Murabahah master agreement ( Commodity Murabahah Master Agreement ) to be entered into between PKNS (in such capacity, the Purchaser ) and the Sub- Purchase Agent, prior to the date on which the relevant series of the Sukuk Murabahah is issued, the Purchaser shall issue a

16 16 purchase order ( Purchase Order ) in relation to the said series to the Purchase Agent and Sub-Purchase Agent. In the Purchase Order to be issued by the Purchaser, the Purchaser will request the Purchase Agent and the Sub-Purchase Agent to purchase the Commodities. The Purchaser will irrevocably undertake to purchase the Commodities from the Sukukholders via the Sub-Purchase Agent at the deferred sale price which shall be equivalent to the Purchase Price (as defined below) of the Sukuk Murabahah plus the aggregate profit margin, payable on a deferred payment basis ( Deferred Sale Price ) which will be determined prior to the sale of the Commodities to the Purchaser and subject to Ibra (as defined herein) if any. Based on the Purchase Order, the Sub- Purchase Agent (pursuant to a commodity trading participant purchase agreement ( CTP Purchase Agreement ) entered into between the Sub-Purchase Agent and the commodity trading participant ( CTP )), will appoint the CTP to purchase the Commodities from commodity supplier(s) ( Commodity Supplier ) in the Bursa Suq Al-Sila commodity market on a spot basis at a purchase price ( Purchase Price ), which shall be an amount equivalent to the Sukuk Murabahah proceeds. The Commodities purchased by the Sub- Purchase Agent via the CTP shall be passed from the commodity supplier(s) to the CTP, held for the benefit of the Sukukholders. The Purchase Price of the Commodities shall be in accordance with the asset pricing requirements stipulated under the LOLA Guidelines.

17 17 PKNS (acting as the Issuer) shall then issue Sukuk Murabahah to the Sukukholders to evidence the Sukukholders ownership of the Commodities and subsequently once the Commodities are sold to the Purchaser, to evidence the Sukukholders entitlement to receive the Deferred Sale Price. The proceeds received from the Sukukholders shall be used to pay for the Purchase Price of the Commodities. Thereafter, pursuant to the undertaking under the Purchase Order by the Purchaser, the Sub-Purchase Agent (acting on behalf of the Purchase Agent for the Sukukholders) shall sell the Commodities to the Purchaser under a sale and purchase agreement ( Sale and Purchase Agreement ) at the Deferred Sale Price. Upon completion of such purchase by the Purchaser, the Purchaser (pursuant to a commodity trading participant sale agreement ( CTP Sale Agreement ) entered into between the Purchaser and the CTP) shall appoint the CTP to sell the Commodities to Bursa Malaysia Islamic Services Sdn Bhd ( BMIS ) on a spot basis for an amount equal to the Purchase Price. The CTP Sale Agreement will provide for the CTP to directly sell the Commodities to BMIS upon notice by the Sub-Purchase Agent that the Sale and Purchase Agreement has been completed and executed and receipt of sale instruction from the Purchaser. For the avoidance of doubt, the sale to BMIS shall be in consideration of an amount equal to the Purchase Price. The Commodities shall pass from the CTP

18 18 (acting on behalf of the Purchaser) to BMIS. The Sukuk Murabahah may be issued with or without periodic profit payments ( Periodic Profit Payments ). For Sukuk Murabahah with Periodic Profit Payments, PKNS shall make Periodic Profit Payments forming part of the Deferred Sale Price to the Sukukholders during the tenure of the Sukuk Murabahah. The Periodic Profit Payments shall be calculated based on a profit rate to be agreed prior to each issuance of the Sukuk Murabahah and shall be payable semi-annually (in arrears) or such other frequency as may be agreed between the Issuer and the Lead Arranger. The Periodic Profit Payment(s) shall be calculated on the basis of actual number of days elapsed and actual days (actual days/actual days). For Sukuk Murabahah without Periodic Profit Payments, PKNS shall make a oneoff lump sum payment on the maturity date which shall be equivalent to the Deferred Sale Price, to the Sukukholder(s). Each such payment shall reduce the Issuer s payment obligation in respect of the Deferred Sale Price payable on the Commodities to the extent of such payment actually made. Upon the respective maturity dates of the Sukuk Murabahah or upon the declaration of an event of default ( Event of Default ), the Purchaser shall pay all amounts outstanding in respect of the Deferred Sale Price of the Sukuk Murabahah (subject to Ibra if any) upon which such Sukuk Murabahah shall be cancelled. Please refer to Annexure A for the illustrative diagram of the Sukuk Murabahah transaction structure.

19 19 (5) Currency Ringgit Malaysia. (6) Expected facility/ programme size (for programme, to state the option to upsize) ICP Programme Up to RM300.0 million in nominal value. IMTN Programme Up to RM1.7 billion in nominal value. Subject always to the aggregate nominal value of all outstanding Sukuk Murabahah issued under the Sukuk Murabahah Programmes at any point in time not exceeding RM1.7 billion. Sukuk Murabahah Programmes For each issuance, the Purchase Price of the Commodities (i.e. the issue size) shall be in compliance with the asset pricing requirement as provided in the LOLA Guidelines. (7) Tenure of facility/programme Tenure of the facility ICP Programme The ICP Programme shall have an availability period and a tenure of seven (7) years from the date of the first issue of ICPs under the ICP Programme. IMTN Programme The IMTN Programme shall have an availability period and a tenure of twenty (20) years from the date of the first issue of IMTNs under the IMTN Programme. The first issuance of the Sukuk Murabahah under the Sukuk Murabahah Programmes shall be made within two (2) years from the date of the SC s approval or such other later date as may be approved by the SC.

20 20 Tenure of the issue ICPs The ICPs shall have tenures of one (1), two (2), three (3), six (6), nine (9) or twelve (12) months, as the Issuer may select provided always that the maturity date of the respective ICPs shall not extend beyond the expiry date of the ICP Programme. IMTNs The IMTNs shall have tenures of more than one (1) year but not exceeding twenty (20) years, as the Issuer may select provided always that the maturity date of the respective IMTNs shall not extend beyond the expiry of the IMTN Programme. (8) Availability period of debt or sukuk programme ICP Programme The ICP Programme shall be made available for the period commencing on the date of fulfillment of the conditions precedent set out in the programme agreement and ending on the date falling seven (7) years from the date of the first issue of ICPs under the ICP Programme. IMTN Programme The IMTN Programme shall be made available for the period commencing on the date of fulfillment of the conditions precedent set out in the programme agreement and ending on the date falling twenty (20) years from the date of the first issue of the IMTNs under the IMTN Programme. (9) Clearing and settlement platform MyClear (10) Mode of issue ICP Via competitive tender by the TPMs, private placement on a best efforts basis, bookrunning on a best efforts basis or bought-

21 21 deal on a best efforts basis. IMTNs Private placement on a best efforts basis, bookrunning on a best efforts basis or bought-deal on a best efforts basis. (11) Selling restrictions Selling Restrictions at Issuance The Sukuk Murabahah may not be offered, sold or delivered, directly or indirectly, nor may any document or other material in connection therewith be distributed in Malaysia, other than to persons falling within Part I of Schedule 6 or Section 229(1)(b), Part I of Schedule 7 or Section 230(1)(b) read together with Schedule 9 or Section 257(3) of the Capital Markets and Services Act 2007 ( CMSA ), as may be replaced, substituted, amended or revised from time to time. Selling Restrictions Thereafter The Sukuk Murabahah may not be offered, sold or delivered, directly or indirectly, nor may any document or other material in connection therewith be distributed in Malaysia, other than to persons falling within Part I of Schedule 6 or Section 229(1)(b) read together with Schedule 9 or Section 257(3) of the CMSA. (12) Tradability and transferability (13) Details of security/collateral pledged, if applicable (14) Details of guarantee, if applicable (15) Convertibility of issuance and details of the Tradable, but subject to the selling restrictions Unsecured Not applicable Not applicable

22 22 convertibility (16) Exchangeability of issuance and details of the exchangeability (17) Call option and details, if applicable (18) Put option and details, if applicable Not applicable Not applicable Not applicable (19) Details of covenants Positive Covenants To include but not limited to the following:- i) The Issuer will provide the Facility Agent/Trustee with its audited financial statements within one hundred and eighty (180) days of the end of each financial year; and such other information (financial or otherwise) as the Facility Agent/Trustee may reasonably require from time to time; ii) The Issuer will meet all its duties and obligations under the Transaction Documents in all respects; iii) The Issuer will notify the Facility Agent/ Trustee of any litigations or claims or other proceedings of any nature whatsoever threatened against it; iv) The Issuer will use its best efforts to pursue claims (if any) against third parties; v) The Issuer will exercise reasonable diligence in carrying out its principal activities in a proper and efficient manner and in accordance with the requirements under the Enactment;

23 23 vi) The Issuer will notify the Facility Agent/ Trustee in writing as soon as it becomes aware of any events of default or potential events of defaults; vii) The Issuer will maintain adequate takaful/ insurance in accordance with common industry practice; viii) The Issuer will maintain its audited financial statements such that its audited financial statements represent fairly and give a true and fair view of its financial position and condition; ix) The Issuer will operate the Sukuk Murabahah Programmes at all times in compliance with the applicable guidelines issued and to be issued by the SC and/or other authorities having jurisdiction over matters pertaining to the Sukuk Murabahah Programmes from time to time; x) The Issuer will, at all times, comply with all conditions imposed in the MOF Approval (as defined in paragraph 33(xii) of Section 1.03 below); and xi) Other covenants typical and customary for similar financing as advised by the Solicitors including such covenants as required under the Trust Deed Guidelines. Negative Covenants To include but not limited to the following:- i) The Issuer will not change the nature or scope of its existing business; ii) The Issuer will not cancel, surrender, abandon or otherwise amend related

24 24 licenses, grants or agreements in any way which has a Material Adverse Effect; iii) iv) The Issuer will not take any step or action towards winding up of the Issuer or enter into any amalgamation, merger or reconstruction; The Issuer will not breach any of the requirements under the Enactment; v) The Issuer will not enter into a transaction, whether directly or indirectly with interested persons (including a Member or persons connected with them) unless- (a) such transaction shall be on terms that are no less favourable to it than those which could have been obtained in a comparable transaction from persons who are not interested persons; and (b) with respect to transactions involving an aggregate payment or value equal to or greater than Ringgit Malaysia Two Hundred and Seventy Million (RM270,000,000.00), it obtains certification from an independent adviser that the transaction is carried out on fair and reasonable terms; PROVIDED that it certifies to the Trustee that the transaction complies with paragraph v(a) and that it has received the certification referred to in paragraph v(b) (where applicable) and that the transaction has been approved by the Members of the Issuer or shareholders in a general meeting as

25 25 the case may require. vi) The Issuer will not make any loans or grant any credit or give any guarantee or indemnity to or for the benefit of any person or otherwise voluntarily assume any liability, whether actual or contingent, in respect of any obligations of any other person save and except for the existing loans made by the Issuer as at 31 October 2011 in the aggregate amount of RM10.0 million to Worldwide Holdings Berhad and RM5.0 million to Selgate Corporation Sdn Bhd (formerly known as PKNS Holdings Sdn Bhd) (collectively, Existing Loans ); vii) The Issuer will not incur, assume, guarantee or permit to exist any indebtedness (including any overdraft or form of borrowing from any other financial institutions) save and except for: (a) short-term debt owing to a nonfinancial institution and payable on demand or maturing by its terms within twelve (12) months after the date on which it is originally incurred provided that no Event of Default has occurred and is subsisting; or (b) such indebtedness which is regarded by the Issuer to be necessary for the normal course and conduct of its operations and the Issuer shall have evidenced the necessity thereof to the satisfaction of the Facility Agent/Trustee provided that no Event of Default has occurred and is subsisting; or (c) such indebtedness has been

26 26 disclosed to the Facility Agent/Trustee prior to the date of the trust deed for the Sukuk Murabahah Programmes; vii) The Issuer will not permit to exist any mortgage, charge, pledge, lien, encumbrance or other security interest of any kind on its assets; and viii) Other covenants typical and customary for similar financing as may be advised by the Solicitors including such covenants as required under the Trust Deed Guidelines. (20) Details of designated accounts, if applicable, including- Not applicable. (a) names of account (b) parties responsible for opening the account (c) parties responsible for maintaining/operating the account (d) signatories to the account (e) sources and utilisation of funds; and (f) diagram illustrating the flow of monies and conditions for disbursements (21) Name of credit rating agency, credit rating (state whether final or indicative) and amount rated, if ICP Programme Final short-term rating of P1. IMTN Programme

27 27 applicable Final long-term rating of AA3. Name of Rating Agency RAM Rating Services Berhad ( RAM Ratings ). (22) Conditions precedent To include but not limited to the following (in form and substance acceptable to the Lead Arranger):- i) PKNS shall have procured the relevant approval from the Ministry of Finance, Malaysia ( MOF ) as required under the Enactment with all conditions imposed therein (if any and where relevant) having been or will be fulfilled; ii) iii) iv) Receipt of the approval from the SC and/or any other authorities (other than that referred to in paragraph (i) above) having jurisdiction over matters pertaining to the Sukuk Murabahah Programmes; The Issuer shall have obtained a minimum short term rating of P1 and a long term rating of AA3 from RAM Ratings for the ICP Programme and IMTN Programme, respectively; Satisfactory legal due diligence as required under the CMSA; v) Documentary evidence that the Sukuk Murabahah Programmes and the Transaction Documents (as defined herein) have received the endorsement and approval of the Shariah Adviser; vi) In respect of the Existing Loans (as defined in paragraph 19(vi) (Negative Covenants), the Lead Arranger shall have received a written confirmation

28 28 from the Issuer confirming whether the granting of the Existing Loans required the prior approval of the MOF and if such approval was required, the Lead Arranger shall have received a certified true copy of the said approval. If the approval of the MOF is not required, the Issuer shall provide documentary evidence confirming the same; vii) Receipt of Solicitors confirmation on the following: a. the programme agreement, the trust deed and other relevant documents pertaining to the Sukuk Murabahah Programmes as advised by the Solicitors (collectively referred to hereafter as the Transaction Documents ) shall have been executed and duly stamped or endorsed as exempted from stamp duty (where applicable); b. the Transaction Documents are legally valid, binding and enforceable; and c. that all conditions precedent have been fulfilled or waived, as the case may be; viii) Receipt from the Issuer of the following:- a. Certified true copies of the extracts of resolution(s) of the Finance Committee and Members of PKNS authorising, inter alia, acceptance of the Sukuk Murabahah Programmes and execution of the Transaction Documents; b. A list of the Issuer s authorised

29 29 signatories and their respective specimen signatures. ix) Evidence that all transaction fees, costs and expenses have been paid in full; and x) Such other conditions precedent typical and customary for similar financing as may be required by the Lead Arranger and/or as advised by the Solicitors and/or Shariah Adviser. (23) Representations and warranties To include but not limited to the following:- i) the Issuer is a corporation duly established under the Enactment and is validly existing; ii) the Issuer has the power to enter into, exercise its rights and perform its obligations under the Transaction Documents; iii) all necessary actions, authorizations and consents required under the Transaction Documents have been taken, fulfilled and obtained and remain in full force and effect; iv) the Issuer s entry into, exercise of its rights and performance of its obligations under the Transaction Documents do not and will not violate any existing law or agreements to which it is a party; v) the Transaction Documents create valid and binding obligations which are enforceable on and against the Issuer; vi) the Issuer s audited financial statements are prepared in accordance with generally accepted accounting

30 30 principles and standards and they fairly represent the Issuer s financial position; vii) there is no litigation or arbitration in which the Issuer is currently involved or which is threatened and which would have a Material Adverse Effect (as defined in paragraph 33(xii) of Section 1.03 below); viii) Issuer is in compliance and will comply with the requirements under the Enactment, all other applicable laws and regulations and the conditions imposed in the MOF Approval (as defined in paragraph 33(xii) of Section 1.03 below); and ix) such other representations and warranties as may be advised by the Solicitors. (24) Events of defaults or enforcement events, where applicable, including recourse available to investors To include but not limited to the following:- i) the Issuer fails to pay any sum due under the Sukuk Murabahah or the Transaction Documents on the due date thereof and/or upon written demand by the Trustee; ii) the Issuer commits any breach or omits to observe any of the obligations, undertakings or covenants expressed to be assumed by it under the Sukuk Murabahah Programmes or under any of the Transaction Documents (save and except item (i) above), which is not capable of being remedied or which, if being capable of a remedy, is not remedied within fourteen (14) days after the Issuer becomes aware of such default or is not remedied within fourteen (14) days after notice to the Issuer from the Trustee requesting action to remedy the same;

31 31 iii) any indebtedness of the Issuer becomes due or capable of being declared due before its stated maturity, any guarantee or similar obligation of the Issuer is not discharged at maturity or when called or the Issuer defaults under, or commits a breach of, any instrument or agreement relating to any such indebtedness, guarantee or other similar obligation; iv) any consent, authorization, licence, approval or registration with or declaration to governmental or public bodies or authorities or courts (if any) required by the Issuer to authorise or required by the Issuer in connection with the execution, issue, sale, delivery, validity, enforceability or admissibility in evidence of any of the Transaction Documents or the Sukuk Murabahah Programmes or the performance by the Issuer of its obligations under any of the Transaction Documents or the Sukuk Murabahah Programmes as the case may be, is modified or is not granted or is revoked or expired or is not renewed or otherwise ceases to be in full force and effect; v) the Issuer changes the nature or scope of its business, suspends, ceases or threatens to suspend or cease a substantial part of its business operations; vi) the occurrence of any of the following events (not exhaustive):- a. an application (other than a frivolous or vexatious application or an application which is stayed within fourteen (14) days) is made to a court or an order is made that the Issuer be wound up or any steps or action taken to wind up the Issuer

32 32 other than for the purposes of a solvent reconstruction or amalgamation; b. a receiver, receiver and manager, liquidator, trustee or similar officer is appointed in respect of any part of the property of the Issuer and such appointment is not discharged within fourteen (14) days; c. the Issuer commences negotiations with any one or more of its creditors with a view to the general readjustment or rescheduling of its indebtedness or makes a general assignment for the benefit of or a composition with its creditors (other than for the purposes of a solvent reconstruction or amalgamation); or vii) such other events of default as may be advised by the Solicitors including such events of default as required under the Trust Deeds Guidelines (as defined herein). If any of the above occurs, the Trustee may, or if so directed by a Special Resolution passed by the Sukukholders of each and every series, shall declare that all the Sukuk Murabahah shall be immediately due and payable in full in accordance with the terms of the relevant Transaction Documents. The expression Special Resolution shall mean a resolution passed at a meeting of the Sukukholders of each series then outstanding and carried by a majority consisting of not less than three fourth (3/4) of all such Sukukholders of each series respectively voting thereat. (25) Governing laws The Laws of Malaysia.

33 33 (26) Provisions on buy-back, if applicable The Issuer or any of its related corporations (within the meaning of the Companies Act 2016) may at any time acquire the Sukuk Murabahah on the open market or otherwise, at any price provided: (a) (b) The Sukuk Murabahah so acquired by the Issuer and its subsidiaries must be surrendered for cancellation and cannot be resold or reissued; If applicable, any Sukuk Murabahah acquired by the Issuer s related corporations (other than the Issuer s subsidiaries) need not be cancelled but shall not entitle such related corporations to participate in the voting of any Sukukholders resolutions nor form part of the quorum of any meeting. (27) Provisions on early redemption, if applicable Not applicable (28) Voting Voting by the Sukukholders shall be carried out as follows:- Prior to the Proposed Upsizing All matters/resolutions which require the Sukukholders consent/approval shall be carried out on a collective basis. Post the Proposed Upsizing All matters/resolutions which require the Sukukholders consent/approval shall be carried out on a per series basis. per series shall mean, in relation to any Sukuk Murabahah, such Sukuk Murabahah having the same issue date and maturity date.

34 34 For the avoidance of doubt, the matters/resolutions referred above are required to be deliberated/passed by the Sukukholders of each and every series of the Sukuk Murabahah such that if the said matter/resolution is not approved/passed by such Sukukholders of any one (1) series, then the same shall not be considered to have been approved/passed. (29) Permitted investments, if applicable Not applicable (30) Ta widh In the event of delay in payment of the Deferred Sale Price under the Sukuk Murabahah, the Issuer shall pay Ta widh (Compensation) on such overdue amounts at the rate and in the manner prescribed by the SAC of the SC. Any Ta widh (Compensation) referred to above which is paid to the Sukukholders, can be treated and/or utilized by the Sukukholders at their absolute discretion in accordance with or as determined by their respective Shariah requirements, which may include donation to any registered charitable organization or for any charitable purposes. (31) Ibra Ibra refers to an act of releasing absolutely or conditionally the Sukukholders rights and claims on any obligation against the Issuer which would result in the latter being discharged of its obligations or liabilities towards the former. The release may be either partial or in full. With respect to the Murabahah contract, Ibra refers to the release of rights on debts/ amount due and payable under the said contract. An Ibra may be granted at the absolute discretion of the Sukukholders. The

35 35 (32) Kafalah; and Not applicable Sukukholders in subscribing or purchasing the Sukuk Murabahah consent to grant an Ibra, if the Sukuk Murabahah is redeemed upon the declaration of an Event of Default. Upon the declaration of an Event of Default, the Ibra shall be the unearned profit due to the Sukukholders and calculated from the date of the declaration of an Event of Default up to the Sukuk Murabahah s respective maturity dates. (33) Other terms and conditions i) Status The Sukuk Murabahah shall constitute direct, unconditional, unsecured and unsubordinated obligations of the Issuer and shall at all times rank pari passu, without discrimination, preference or priority amongst themselves and pari passu with all other present and future direct, unconditional, unsecured and unsubordinated obligations of the Issuer, subject to those preferred by law. ii) Taxation All payments by the Issuer in respect of the Sukuk Murabahah shall be made free and clear of any present and future taxes, withholding taxes, stamp duties, levies, deductions and charges of whatever nature. In the event that any such taxes, withholding taxes, stamp duties, levies, deductions or charges are imposed, the Issuer will make such additional payments (or gross up) as are necessary to cause the Sukukholders to receive a net sum equal to what they would have received had no such deduction, withholding or payment been required or made.

36 36 iii) Details on utilisation of proceeds The proceeds raised from the Sukuk Murabahah Programmes shall be utilised to part-finance PKNS s Shariah-compliant general working capital requirements and/or general investments from time to time PROVIDED THAT to the extent that the proceeds raised from the IMTNs issued pursuant to the Upsized IMTN Amount (as defined in paragraph 33(xii) of Section 1.03 below) are utilised as follows, such proceeds shall not exceed:- (a) (b) (c) (d) RM100,000, in aggregate at all times (or such other amount as may be approved by the MOF from time to time and at any time), to fund part of the purchase costs to increase the Issuer s land bank and to fund future development projects; RM500,000, in aggregate at all times (or such other amount as may be approved by the MOF from time to time and at any time), to fund the payment of land premium for Phase 2 and Phase 3 of Selangor Cyber Valley; RM46,000, in aggregate at all times (or such other amount as may be approved by the MOF from time to time and at any time), to fund part of the platform costs and basement parking of Menara PJ Sentral which are to be paid by the Issuer to Syarikat PJ Sentral Development Sdn Bhd; and RM354,000, in aggregate at all times (or such other amount as may be approved by the MOF from time to time and at any time), to fund equity injection into the subsidiaries of the Issuer.

37 37 iv) Identified assets Shariah-compliant commodities (excluding ribawi items in the category of medium of exchange such as currency, gold and silver) which will be identified at or around the time of issuance of the Sukuk Murabahah as approved by the Shariah Adviser. v) Listing status and types of listing The Sukuk Murabahah issued under the Sukuk Murabahah Programmes may be listed on Bursa Malaysia Securities Berhad under an Exempt Regime pursuant to Chapter 4B of Main Market Listing Requirements. The SC will be notified accordingly in the event of such listing. vi) Jurisdiction Exclusive jurisdiction of the Courts of Malaysia vii) Trust Deed The Sukuk Murabahah shall be constituted by a trust deed, which shall be administered by the Trustee, acting for and on behalf of the Sukukholders. viii) Adverse Market Conditions At any time prior to the issuance of the Sukuk Murabahah, the Lead Arranger / Joint Lead Managers / Facility Agent / placee(s) / investor(s) reserve(s) the right to withdraw / terminate the arrangement of the Sukuk Murabahah Programmes if there occurs any change in the national or international financial, political or economic conditions, including but not limited to adversities in international/domestic money, capital or syndicated financing markets, the business activities or financial position of the Issuer which in the opinion of the Lead Arranger / Joint Lead Managers / Facility Agent / placee(s) / investor(s) will materially affect the offering and distribution of the Sukuk Murabahah or dealings in the Sukuk Murabahah in the secondary market upon successful completion of the arrangement of the same.

38 38 ix) Clear Market From the date that PKNS obtains all the necessary approvals of its Finance Committee and Members for the issuance of the Sukuk Murabahah under the Sukuk Murabahah Programmes until ninety (90) days after the initial issuance under the Sukuk Murabahah Programmes, the Issuer shall ensure that, other than the existing fund raising exercise by the Issuer, there are no other financing facilities or debt instruments or securities issued by the Issuer, its subsidiaries or associated companies that are mandated, placed or syndicated directly or on its behalf without the prior written consent of the Lead Arranger. x) Changes In Circumstances If, as a result of any change in applicable law, regulation or regulatory requirement or in the interpretation or application thereof or if compliance by the Lead Arranger / Joint Lead Managers / Facility Agent / Primary Subscriber(s) / investor(s) (collectively the Transaction Parties ) with the applicable direction, request or requirement (whether or not having the force of law) will impose on the Transaction Parties any condition, burden or obligation, and upon notice to the Issuer after becoming aware of such occurrence or within such reasonable period as may be permitted by law or the authorities: (a) where the change, interpretation or application makes it unlawful for the Transaction Parties to make available the Sukuk Murabahah Programmes or to subscribe or purchase the Sukuk Murabahah without breaching such law or regulation, the Sukuk Murabahah

39 39 Programmes shall be cancelled and the obligations of the Transaction Parties in respect of the Sukuk Murabahah Programmes and/or the Sukuk Murabahah shall be forthwith terminated and cancelled; and (b) where the change, interpretation or application causes the Transaction Parties to incur additional costs or requires the Transaction Parties to make further payments then the Issuer shall compensate the Transaction Parties for the additional cost incurred or payments made. xi) Documentation Standard documentation satisfactory to all parties concerned incorporating clauses normal and customary for a financing of this nature and/or as advised by the Solicitors and/or Shariah Adviser. xii) Definitions Material Adverse Effect means in relation to any event or circumstance, an event or circumstance the occurrence or effect of which: (i) (ii) materially and adversely changes or would materially and adversely change the business, assets or conditions (financial or otherwise) or operating result of the Issuer; or is or would be materially prejudicial to the ability of the Issuer to perform its obligations under the Transaction Documents to which it is a party; MOF Approval means the approval granted by the MOF to the Issuer for the Proposed Upsizing via its letter dated 3 April 2017 subject to the conditions more particularly set out therein and such other or further approvals granted by the MOF at any time

40 40 after 3 April 2017 and from time to time after 3 April 2017, in respect of the Proposed Upsizing and/or the Sukuk Murabahah Programmes; Proposed Upsizing means the proposed upsizing of the initial joint limit of the Sukuk Murabahah Programmes and the initial programme size of the IMTN Programme from RM700.0 million to RM1.7 billion in nominal value; Trust Deed Guidelines means the Trust Deeds Guidelines (revised on 12 July 2011 and effective on 12 August 2011) issued by the SC as may be replaced, substituted or revised from time to time; Upsized IMTN Amount means the IMTNs upsized amount of RM1.0 billion in nominal value. [The rest of this page has been left blank intentionally]

41 41 Annexure A TRANSACTION DIAGRAM OF THE SUKUK MURABAHAH

42 42 EXPLANATORY NOTES OF THE SUKUK MURABAHAH Steps 1a 1b 2 3a Description of the Sukuk Murabahah Structure The Sukuk Trustee, on behalf of the Sukukholders, and PKNS will enter into an agency agreement ( Service Agency Agreement ), pursuant to which PKNS (in such capacity, the Purchase Agent ) is appointed as the agent of the Sukukholders for the purchase and sale of certain Shariahcompliant commodities which would exclude ribawi items in the category of medium of exchange such as currency, gold and silver ( Commodities ). The Purchase Agent will then enter into a facility agency agreement ( Facility Agency Agreement ) to appoint the Facility Agent as the subagent of the Sukukholders (in such capacity, the Sub-Purchase Agent ) for the purchase and sale of the Commodities under the Upsized Sukuk Murabahah Programmes. Pursuant to a commodity Murabahah master agreement ( Commodity Murabahah Master Agreement ) to be entered into between PKNS (in such capacity, the Purchaser ) and the Sub-Purchase Agent, prior to the date on which the relevant series of the Sukuk Murabahah is issued, the Purchaser shall issue a purchase order ( Purchase Order ) in relation to the said series to the Purchase Agent and Sub-Purchase Agent. In the Purchase Order to be issued by the Purchaser, the Purchaser will request the Purchase Agent and the Sub-Purchase Agent to purchase the Commodities. The Purchaser will irrevocably undertake to purchase the Commodities from the Sukukholders via the Sub-Purchase Agent at the deferred sale price which shall be equivalent to the Purchase Price of the Sukuk Murabahah plus the aggregate profit margin, payable on a deferred payment basis ( Deferred Sale Price ) which will be determined prior to the sale of the Commodities to the Purchaser and subject to Ibra, if any. Based on the Purchase Order, the Sub-Purchase Agent (pursuant to a commodity trading participant purchase agreement ( CTP Purchase Agreement ) to be entered into between the Sub-Purchase Agent and the commodity trading participant ( CTP )), will appoint the CTP to purchase the Commodities from commodity supplier(s) ( Commodity Supplier ) in the Bursa Suq Al-Sila commodity market on a spot basis at a purchase price ( Purchase Price ) which shall be an amount equivalent to the Sukuk Murabahah proceeds.