39 th Floor, Menara Multi-Purpose No. 8, Jalan Munshi Abdullah Capital Square Kuala Lumpur

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1 PRINCIPLE TERMS AND CONDITIONS OF THE PROPOSALS 1. Background information on the issuer Name Address Multi-Purpose Holdings Berhad (MPHB) 39 th Floor, Menara Multi-Purpose No. 8, Jalan Munshi Abdullah Capital Square Kuala Lumpur Business registration no M Date / Place of incorporation MPHB was incorporated in Malaysia on 18 August 1975 as a public limited company under the Act Date of listing MPHB was listed on the Main Board of the KLSE on 11 January 1982 Status Principal activities Non-Bumiputera resident controlled company The principal activities of the Company are investment holding and the provision of share registration and management services. The principal activities of MPHB s subsidiary and associated company include the following: investment holding and trading; operation of general insurance and trustee services; securities broking and dealing; operation and management of gaming activities; operation of a licensed four digit numbers forecast game; and operation of hotels. Board of Directors Director Datuk Razman Md Hashim bin Che Din Md Hashim Datuk Surin Upatkoon Ng Kok Cheang Vijeyaratnam a/l V.Thamotharam Pillay Tham Ka Hon Lim Tiong Chin Sahibudeen bin Abdul Kader Designation Independent Non-Executive Chairman Managing Director Executive Director Non-Executive Director Non-Executive Director Non-Executive Director Independent Non-Executive Director 1

2 Substantial shareholders The substantial shareholders of MPHB (holding 5% or more in the issued and paid-up share capital of the company) as at 29 April 2003 are as follows: Quantum Aspects Sdn Bhd Direct No. of Shares % held Indirect No. of Shares % held Nationality/ Country of incorporation 291,790, Malaysia Lim Tiong Chin ,790, Malaysian Dynamic Icon Sdn Bhd ,790, Malaysia Dimensi Nada Sdn Bhd ,790, Malaysia Tham Ka Hon ,790, Malaysian Datuk Surin Upatkoon ,790, Thai Tan Heng Kok ,790, Malaysian Goh Thian Joe ,790, Malaysian Lim Bian Yong ,790, Malaysian Notes: 1. Held via Bumiputra-Commerce Nominees (Tempatan) Sdn Bhd. 2. Deemed interested by virtue of his / its substantial shareholding in QASB pursuant to Section 6A(4) of the Act. 3. Deemed interested by virtue of his substantial shareholding in Dynamic Icon Sdn Bhd pursuant to Section 6A(4) of the Act. 4. Deemed interested by virtue of his substantial shareholding in Dimensi Nada Sdn Bhd pursuant to Section 6A(4) of the Act Authorised and issued and paid-up share capital As at 29 April 2003 No. of ordinary shares of RM1.00 each Authorised 10,000,000,000 10,000,000,000 Issued and fully paid-up 953,863, ,863,270 RM 2

3 2. Parties involved in the Proposals Principal Adviser / Lead Arranger Arranger Valuer Solicitors Financial Adviser Technical Adviser Guarantor Trustee Facility Agent Primary Subscriber Southern Investment Bank Berhad Not applicable Not applicable Messrs Lee Hishammuddin Not applicable Not applicable Not applicable Mayban Trustees Berhad Southern Investment Bank Berhad 1. Deutsche Bank (Malaysia) Berhad (for the Bonds with the Provisional Rights of Warrants which will subsequently be detached from the Bonds) 2. Southern Investment Bank Berhad (SIBB) (for the Provisional Rights of Warrants) Underwriters SIBB and other underwriters to be secured by SIBB for the Provisional Rights of Warrants The amount underwritten will be the difference between RM300,000,000 and the amount of issue proceeds to be raised from the placement of the Bonds to be executed by Deutsche Bank Syariah Adviser Central Depository Paying Agent Reporting Accountant Joint Adviser Lead Manager / Bookrunner Not applicable BNM BNM Messrs Ernst & Young Newfields Advisors Sdn Bhd Deutsche Bank (Malaysia) Berhad 3

4 3. Principle terms and conditions of the Bonds 3. Principle Conventional 4. Facility description Nominal value of 5-year exchangeable bonds with renounceable provisional rights to allotment of 200,000,000 Warrants 5. Issue size RM300,000,000 nominal value of 5-year exchangeable bonds with provisional rights to allotment of 200,000,000 Warrants. 6. Issue price Indicative issue price ranging from 91.25% to 92.50% based on the nominal amount of the Bonds 7. Tenor of facility / Five (5) years from the date of issue issue 8. Coupon rate Indicative rate of five (5)% per annum based on the nominal value of the Bonds 9. Coupon payment frequency 10. Coupon payment basis Payable semi-annually in arrears Actual / 365 days 11. Yield to Maturity Indicative yield to maturity ranging from 6.79% to 7.11% 12. Security / Collateral Unsecured 4

5 13. Details on utilisation of proceeds The Proposals are expected to raise a total gross proceeds of RM300.0 million which are to be utilised as follows: RM 000 Repayment of bank borrowings of MPHB and its subsidiaries 260,000 Working capital 32,000 Estimated expenses for the Proposals 8,000 Total 300, Sinking fund Not applicable 15. Rating Final rating of A3 by Rating Agency Malaysia Berhad 16. Form and Denomination The Bonds shall be issued in accordance with: (i) The Code of Conduct and Market Practices for the Malaysian Corporate Bond Market issued by the Institut Peniaga Bon Malaysia and approved by BNM; and (ii) The RENTAS System issued by BNM, or their replacement thereof, applicable form time to time. 17. Mode of Issue Private placement The Bonds will be in Bearer Form and will be represented by a Global Certificate to be deposited with BNM and shall be traded scripless under the RENTAS system and in denominations of Ringgit Malaysia One Hundred Thousand (RM100,000) subject to the Rules on Fully Automated System for Issuing / Tendering (FAST) issued by BNM 18. Selling restrictions The Bonds may not be offered or sold, directly or indirectly, nor may any documents or other material in connection therewith be distributed, in Malaysia, other than in circumstances which would result in such offer, sale, invitation or distribution falling within Schedules 2 and or 3, or both, as the case may be of the SC Act, Listing status The Bonds will not be listed on the KLSE. 20. Minimum level of subscription RM300,000,000 nominal value 21. Other regulatory approvals 5

6 SC The registration of the prospectus pursuant to the Proposed Offer for Sale Status To be obtained FIC (via the SC) KLSE Proposals The listing and quotation for the Warrants and the new MPHB Shares to be issued upon exercise of the Warrants To be obtained To be obtained CCM The lodgment of the prospectus pursuant to the Proposed Offer for Sale To be obtained 22. Additional information for Islamic PDS 23. Conditions precedent Not applicable Including but not limited to the following: (i) Evidence of approval of the SC and / or other regulatory bodies in respect of the Proposals shall have been obtained; (ii) Approvals from the Board of Directors of the Issuer authorising the Proposals and the execution of all relevant documents thereto; (iii) Satisfactory completion and execution of all legal documentation including but limited to the Issue Documents and duly endorsed as exempted under Stamp Duty Exemption (N0.23) Order 2000; (iv) Satisfactory legal opinion from the Solicitors as to the validity and enforceability of the Issue Documents and that all conditions precedent set out hereto have been duly complied; and (v) Any other conditions which may be advised by the Solicitors. 6

7 24. Representations and Warranties Including but not limited to the following: (i) The Issuer has the authority to enter into the Issue Documents; (ii) The Issue Documents are in full force and effect and constitute a valid, binding and enforceable obligations of the Issuer; (iii) The Issuer s entry into, exercise of its rights under and performance of the Issue Documents do not and will not violate any existing law or agreements to which it is a party; (iv) No event of default has occurred and there is no encumbrance on the assets of the Issuer except as permitted herein; (v) There is no litigation or arbitration that will materially and adversely affect the ability of the Issuer to perform its obligations under the Issue Documents to which it is party save as disclosed; (vi) The financial statements and other information supplied are true and accurate in all material respects and not misleading; (vii) Neither the Issuer nor any of its assets are entitled to immunity from process, execution, attachment or legal process; (viii) The Issuer is in compliance and will comply with any applicable laws and regulations; and (ix) Any other representations and warranties as advised by the Solicitors. 7

8 25. Events of default Including but not limited to the following: (i) Non-payment: The Issuer fails to pay any amount due under the Proposals or any of the Issue Documents on the due date or on demand, if so payable; (ii) Breach of obligations: The Issuer fails to observe or perform any of its obligations under the Issue Documents or under any undertaking or arrangement entered into in connection herewith or therewith, other than an obligation of the type referred to in paragraph (i) above and in the case of a failure capable of being remedied, the Trustee does not determine, within thirty (30) days after the Trustee s notice to the Issuer requiring the default to be remedied, that such failure has been remedied to the Trustee s satisfaction; (iii) Misrepresentation: Any representation, warranty or statement which is made (or acknowledged to have been made) by the Issuer in the Issue Documents or which is contained in any certificate, statement, legal opinion or notice provided hereunder or in connection therewith proves to be incorrect in any material respect, or if repeated at any time with reference to the facts and circumstances subsisting at such time would not be accurate in all material respects; (iv) Cross-default: The Issuer stops or threatens to stop payment in respect of its obligations generally or if any other debenture of or monies borrowed by the Issuer becomes repayable by reason of default or any amount owing thereunder or in respect thereof is not repaid on its due date (or within any applicable grace period) or if any guarantee or indemnity given by the Issuer is not honoured when due and called upon of if any security for any such debenture, monies borrowed, guarantee or indemnity becomes enforceable; (v) Cessation of business: The Issuer changes or threatens to change the nature or scope of its business, suspends or threatens to suspend a substantial part of the present business operations which it now conducts directly or indirectly, or any governmental authority expropriates or threatens to expropriate all or part of its assets; 8

9 (vi) Appointment of receiver, legal process: An encumbrancer takes possession or a trustee or administrator or receiver or other similar officer is appointed of the whole or any part of the business or assets or undertaking of the Issuer or is a distress or execution is levied or enforced upon or sued out against any part of the assets or property of the Issuer and is not discharged within fourteen (14) days after being levied, enforced or sued or any of the security interest which may for the time being affect any of the Issuer s assets becomes enforceable; (vii) Insolvency: The Issuer is for the purposes of Section 218(2) of the Act deemed to be unable to pay its debts as they fall due or suspends or threatens to suspend making payments (whether of Principle or interest) with respect to all or any class of its debts; (viii) Composition, Winding up: The Issuer convenes a meeting of its creditors or proposes or makes any arrangement or composition with, or any assignment for the benefit of its creditors or a petition is presented or a meeting is convened for the purpose of considering a resolution or other steps are taken for making an administration order against or for winding up or dissolution of the Issuer (other than for purposes of and followed by a reconstruction previously approved in writing by the Bondholders pursuant to an extraordinary resolution, unless during or following such reconstruction the Issuer becomes or is declared to be insolvent) or if a provisional liquidator of the Issuer is appointed; (ix) Disposal: The Issuer sells, transfers, encumbers, leases (other than operating lease) or otherwise disposes of or in any case ceases to exercise control over, whether by single transaction or a number of transactions, related or not, the whole or a substantial part of the Issuer s undertaking business or assets without the prior written consent of the Trustee; (x) Illegality, Invalidity and Unenforceability: At any time it is unlawful for the Issuer to perform any of its obligations under the financing documents or any provision of the financing documents is or becomes, for any reason, invalid or unenforceable; 9

10 (xi) Section 176 of the Act: A scheme of arrangement under Section 176 of the Act has been instituted by or against the Issuer; (xii) Judgment Passed: The Issuer fails to satisfy any judgment passed against the Issuer by any court of competent jurisdiction and no appeal against such judgment has been made to any appropriate appellate court within the time prescribed by law or such appeal has been dismissed; and (xiii) Any other events of default as deemed necessary by the Lead Arranger and/or Solicitors. The above is subject to the finalised Trust Deed to be forwarded to the SC in due course. 10

11 26. Principle terms and conditions for the Warrants Provisional rights of Warrants subscriber Issue size SIBB The provisional rights to allotment of 200,000,000 Warrants in MPHB to subscribe for 200,000,000 new MPHB Shares Basis A. Proposed Offer for Sale Proposed offer for sale of 95,386,327 Provisional Rights of Warrants to the existing shareholders of MPHB on a renounceable basis of one (1) Warrant for every ten (10) existing MPHB Shares held at an offer price to be determined at a later date B. Proposed Placement Proposed placement of 104,613,673 Provisional Rights of Warrants to identified investors at an offer price to be determined at a later date Form and Denomination Offer price Warrants entitlement Category of Placees Expiry date The Warrants will be issued in registered form and will be immediately detached from the Bonds upon issue. Upon allotment, the Warrants to be issued will be credited into the relevant CDS accounts for the Warrantholders and separately traded upon issue Indicative offer price of RM0.11 to RM0.13, subject to the finalisation of the issue price of the Bonds Each Warrant entitles the registered holder to subscribe for one (1) new MPHB Share during the exercise period at the exercise price. The Warrants entitlement is subject to adjustments under the terms and conditions to be set out in the Deed Poll The Provisional Rights of Warrants will be placed to institutions and / or others who fall under the ambit of Schedule 2 or 3 or both, as the case may be of the SCA Five (5) year from the issuance date 11

12 Exercise price Exercise period Status of New MPHB Shares to be Issued pursuant to the exercise of the Warrants The exercise price of the Warrants will be fixed at par or a discount that ranges from 10% to 30% over the five (5) day weighted average market price of MPHB Shares, whichever is higher. The exercise price of the Warrants is to be determined at a later price fixing date, subject to adjustment under the terms and conditions set out in the Deed Poll The Warrants may be exercised at any time after the date of the issue of the Warrants and ending on or before the maturity date falling five (5) years from the date of issue of the Warrants All the new MPHB Shares to be issued pursuant to the exercise of the Warrants shall, upon allotment and issue, rank pari passu in all respects with the existing MPHB Shares, except that the new MPHB Shares shall not be entitled to any dividends, rights, allotments or other distributions, the book closure date of which is prior to the date of allotment and issue of the new MPHB Shares. For the purpose hereof, book closure date means the date as at the close of business on which shareholders must be registered as members of the Company in order to participate in any dividends, rights, allotments or any other distributions. Listing status Board lot Deed Poll Governing laws An application will be made to the KLSE for the listing and quotation of the Warrants and the new MPHB Shares to be issued upon exercise of the Warrants For the purpose of trading on the KLSE, a board lot of the Warrants will be 100 Warrants carrying the right to subscribe for 100 new MPHB Shares The Warrants will be constituted under a Deed Poll to be executed by MPHB The laws of Malaysia 12

13 27. Other principle terms and conditions: Final redemption Call option Ranking of the Bonds Transferability Exchange Unless previously redeemed, purchased and cancelled or converted, the Bonds will be redeemed five (5) years from the date of issue in Ringgit Malaysia at 100% of their principle amount MPHB may call the Bonds at par, in whole but not in part, at any time after the third anniversary of the date of issue, if the average of the closing bid and offered prices for one (1) Magnum Share on the KLSE, for 20 consecutive KLSE Business Days ending on the KLSE immediately preceding such date shall have exceed 130% of the Exchange Price The Bonds, subject to the Exchange, will constitute unsecured and unsubordinated obligations of MPHB and shall at all time rank pari passu and without any preference or priority among themselves. The payment obligations of MPHB under the Bonds shall, save for such exception as may be provided by applicable legislation, rank at least equally with all its other present and future unsecured and unsubordinated obligations The Bonds shall be transferable by the registration of transfer in accordance with the Code of Conduct and Market Practices for Malaysian Scripless Securities Market under the RENTAS system, and subject to conditions as stipulated in the Trust Deed Each Bond will be, at the option of the Bondholder, exchangeable for Magnum Shares at any time after the date of issue during the period commencing on the date of issue to and including 30 days prior to the Maturity Date. The Bonds will be exchangeable for Magnum Shares at an exchange price based on a premium of not more than 25% over the weighted average market price of the Magnum Shares for five (5) market days preceding the price fixing date on the KLSE for the purpose of determining the total number of Magnum Shares to be made available for the exchange feature of the Bonds. The Exchange Price is subject to adjustment on the occurrence of certain events. MPHB will transfer the necessary number of Magnum Shares to the Trustee in order to ensure sufficient Magnum Shares are available for exchange based on the Exchange Price. 13

14 Cash redemption feature Lock up period No. of Magnum Shares underlying the Exchange Trust Deed Withholding taxation Issue Documents In the event of the Exchange, MPHB reserves the right to provide Bondholders payment in cash in lieu of Magnum Shares equal to the prevailing market prices of Magnum Shares at the date of the Exchange MPHB have agreed that, without the written consent of the Lead Manager, it will not, until 90 days after the issue date, offer, sell, contract to sell or otherwise dispose of, directly or indirectly, any Magnum Shares The total indicative numbers of Magnum Shares underlying the Bonds are 97.5 million Magnum Shares. The Bonds will be constituted under a Trust Deed to be executed between MPHB and a duly authorised trustee who will act in the interest of the Bondholders All payments by MPHB shall be made without withholding or deductions for or on account of any present or future tax, duty or charge of whatsoever nature imposed or levied by or on behalf of Malaysia, or any other applicable jurisdictions, or any authority thereof or therein having power to tax, unless such withholding or deduction is required by law. MPHB shall not be required to gross up in connection with such withholding or deduction The issue documents shall comprise: 1. Subscription Agreement 2. Trust Deed for the Bonds 3. Depository and Paying Agency Agreement 4. Custodian Trust Deed for the Magnum Shares 5. Deed Poll Non-application towards the exercise of Warrants Covenants The Bonds may not be applied towards payment of the exercise of the Warrants Covenants usual and customary for a facility of this nature shall apply including but not limited to the following: 14

15 Positive Covenants The Issuer shall: (i) (ii) (iii) (iv) (v) (vi) Comply with and perform all of its obligations under the Bonds and Issue Documents; Provide annual audited financial statements, within 120 days from the end of each financial year; Maintain its corporate existence and its right to carry on operations; Comply with all applicable laws and regulations; Maintain in full force and effect the licenses necessary to carry on its operations; Obtain and promptly renew from time to time and comply with the terms and conditions of all consents and authorisations which may be required under any applicable law or regulation; (vii) File all relevant tax returns and pay all taxes promptly upon the same becoming due except to the extent the taxes are being contested in good faith and by proper proceedings; (viii) Maintain proper and accurate books and records in accordance with law and generally accepted accounting principles in Malaysia; and (ix) Any other covenants which may be advised by the Solicitors. 15

16 Negative Covenants The Issuer will not, without the prior written consent of the Trustee: (i) (ii) (iii) (iv) (v) Reduce its authorised or issued and paid-up capital save and except for any approved share buy-back; Amend its Memorandum and Articles of Association except where such amendment is required by law or a directive of any regulatory authority or the KLSE; Incur, assume, guarantee or permit to exist any indebtedness to any person that will result in the Issuer breaching its covenants in the Trust Deed in accordance with the terms of the Trust Deed; Cause or permit to arise or subsist any encumbrance (save and except for permitted encumbrances) over any of the Issuer s assets or any part thereof; and Any other covenants as may be advised by the Solicitors. Governing laws The laws of Malaysia 16