ORIENTAL INTEREST BERHAD (Company No M) (Incorporated in Malaysia under the Companies Act, 1965)

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1 THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION If you are in any doubt as to the course of action you should take, you should consult your stockbroker, bank manager, solicitor, accountant or other professional adviser immediately. Bursa Malaysia Securities Berhad ( W) ( Bursa Securities ) takes no responsibility for the contents of this Circular, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this Circular. ORIENTAL INTEREST BERHAD (Company No M) (Incorporated in Malaysia under the Companies Act, 1965) CIRCULAR TO SHAREHOLDERS IN RELATION TO PROPOSED ADDITIONAL AND RENEWAL OF SHAREHOLDERS MANDATE FOR RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE AND NOTICE OF TWENTY-SECOND ANNUAL GENERAL MEETING The resolutions in respect of the above proposals will be tabled at the Twenty-Second (22 nd ) Annual General Meeting of Oriental Interest Berhad ( the Company ). Notice of the 22 nd Annual General Meeting which will be held at Dewan Bankuet Jubli Emas, Royal Kedah Club, Pumpong, Alor Setar, Kedah Darul Aman on Monday, 23 November 2015 at a.m., together with the Form of Proxy are enclosed together herein. The Form of Proxy shall be deposited at the Registered Office of the Company at Lot 6.05, Level 6, KPMG Tower, 8 First Avenue, Bandar Utama, Petaling Jaya, Selangor Darul Ehsan not less than forty-eight (48) hours before the time set for holding the 22 nd Annual General Meeting or at any adjournment thereof. The lodging of the Form of Proxy will not preclude you from attending and voting at the meeting if you subsequently wish to do so. The last day and time for you to lodge the Form of Proxy is on Saturday, 21 November 2015 at a.m. This Circular is dated 30 October 2015

2 DEFINITIONS Except where the context otherwise requires, the following definitions shall apply throughout this Circular:- Act The Malaysian Companies Act, 1965 as amended from time to time and any reenactment thereof AGM Annual General Meeting ARMC Audit and Risk Management Committee of OIB Board or Board of Directors The Board of Directors of OIB Bursa Securities Bursa Malaysia Securities Berhad ( W) Directors Shall have the meaning given in Section 4 of the Act and includes any person who is or was within the preceding 6 months of the date on which the terms of the transaction were agreed upon, a Director of OIB (or any other company which is its subsidiary or holding company) or a Chief Executive Officer of OIB, its subsidiaries or holding company Listing Requirements Main Market Listing Requirements of the Bursa Securities including any amendments to the Listing Requirements that may be made from time to time LPD Latest practicable date of 1 October 2015 Major shareholder A person who is or was within the preceding six (6) months of the date on which the terms of the transactions were agreed upon, has an interest or interests in one or more voting shares in the corporation and the nominal amount of that share, or the aggregate of the nominal amounts of those shares is:- (a) 10% or more of the aggregate of the nominal amounts of all voting shares in the corporation; or (b) 5% or more of the aggregate of the nominal amounts of all the voting shares in the corporation where such person is the largest shareholder of the corporation. For the purpose of this definition, interest in shares has the meaning given in Section 6A of the Act. A major shareholder includes any person who is or was within the preceding 6 months of the date on which the terms of the transaction were agreed upon, a major shareholder of the Company or any other company which is its subsidiary or holding company OIB or Company Oriental Interest Berhad ( M) OIB Group / Group OIB and its subsidiary companies i

3 DEFINITIONS Person(s) Connected In relation to a Director or a Major Shareholder, means such person who falls under any one of the following categories:- (a) (b) (c) (d) (e) (f) (g) (h) (i) A member of the Director s or Major Shareholder s family, which family shall have the meaning given in Section 122A of the Act; A trustee of a trust (other than a trustee for an employee share scheme or pension scheme) under which the Director, Major Shareholder or a member of the Director s or Major Shareholder s family is the sole beneficiary; A partner of the Director, Major Shareholder or a partner of a Person Connected with that Director or Major Shareholder; A person who is accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the Director or Major Shareholder; A person in accordance with whose directions, instructions or wishes the Director or Major Shareholder is accustomed or is under an obligation, whether formal or informal, to act; A body corporate or its directors which/who is/are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the Director or Major Shareholder; A body corporate or its directors whose directions, instructions or wishes the Director or Major Shareholder is accustomed or under an obligation, whether formal or informal, to act; A body corporate in which the Director, Major Shareholder and/or Persons connected with him are entitled to exercise, or control the exercise of, not less than 15% of the votes attached to voting shares in the body corporate; or A body corporate which is a related corporation. Proposed Shareholders Mandate Proposed additional and renewal of shareholders mandate for OIB Group to enter into Recurrent Related Party Transactions Recurrent Related Party Transactions or RRPT Transactions with Related Parties involving recurrent transactions of a revenue or trading nature which are necessary for the OIB Group s day-to-day operations and are in the ordinary course of business of the OIB Group Related Parties - Directors, Major Shareholders and/or Persons Connected with such Directors or Major Shareholders of the Company RM and sen Ringgit Malaysia and sen, respectively ii

4 TABLE OF CONTENTS CIRCULAR TO SHAREHOLDERS OF ORIENTAL INTEREST BERHAD 1. INTRODUCTION 1 2. DETAILS OF THE PROPOSED SHAREHOLDERS MANDATE RATIONALE FOR, AND THE BENEFIT TO THE OIB GROUP FROM TRANSACTING WITH ALL CLASSES OF RELATED PARTIES CONDITIONS FOR THE PROPOSED SHAREHOLDERS MANDATE FINANCIAL EFFECTS OF THE PROPOSED SHAREHOLDERS MANDATE DIRECTORS AND MAJOR SHAREHOLDERS INTERESTS DIRECTORS RECOMMENDATION AGM FURTHER INFORMATION 16 APPENDIX A FURTHER INFORMATION 17 NOTICE OF AGM FORM OF PROXY ANNUAL REPORT 2015 REQUEST FORM Enclosed Enclosed iii

5 ORIENTAL INTEREST BERHAD (Company No M) (Incorporated in Malaysia under the Companies Act, 1965) Registered Office:- Lot 6.05, Level 6, KPMG Tower 8 First Avenue, Bandar Utama Petaling Jaya, Selangor Darul Ehsan Directors Dato Wira Lim Teong Kiat (Independent Non-Executive Chairman) Tunku Mohamad Zulkifli Bin Osman (Independent Non-Executive Director) Low Kok Aun (Managing Director) Low Kok Kean (Executive Director) Low Ping Kun (Executive Director) Low Kok Horng (Non-Independent Non-Executive Director) 30 October 2015 To: The Shareholders of OIB Dear Sir/Madam, PROPOSED SHAREHOLDERS MANDATE FOR RRPT OF A REVENUE OR TRADING NATURE 1.0 INTRODUCTION Our Company had at its AGM held on 25 November 2014, obtained a general mandate from the shareholders for OIB Group to enter into RRPT of a revenue or trading nature which are necessary for OIB Group s day-today operations and are in the ordinary course of business and on terms that are not more favourable to the Related Parties than those generally available to the public. The said general mandate for RRPT shall, in accordance with Listing Requirements, lapse at the conclusion of the forthcoming AGM unless authority for its renewal is renewed. The Board of Directors of OIB Group had, on 5 October 2015, announced that the Company proposed to seek its shareholders approval for the Proposed Shareholders Mandate for the OIB Group under Paragraph of the Listing Requirements at the forthcoming 22 nd AGM to be convened. The purpose of this Circular is to provide you with the relevant information on the Proposed Shareholders Mandate and to seek your approval for the ordinary resolution to be tabled at the forthcoming 22 nd AGM, which will be convened at Dewan Bankuet Jubli Emas, Royal Kedah Club, Pumpong, Alor Setar, Kedah Darul Aman on Monday, 23 November 2015 at a.m.. YOU ARE ADVISED TO READ AND CONSIDER THE CONTENTS OF THIS CIRCULAR INCLUDING THE APPENDIX CAREFULLY BEFORE VOTING ON THE RESOLUTION PERTAINING TO THE PROPOSED SHAREHOLDERS' MANDATE TO BE TABLED AT THE FORTHCOMING 22 ND AGM. 1

6 2.0 DETAILS OF THE PROPOSED SHAREHOLDERS MANDATE 2.1 Provisions under the Listing Requirements Paragraph 10.09(2) of the Listing Requirements provides that a listed issuer may seek a shareholders mandate in respect of recurrent transactions with related parties which are of a revenue or trading nature and are necessary for its day-to-day operations subject to the following:- (a) (b) the transactions are in the ordinary course of business and are on terms not more favourable to the related party than those generally available to the public; the shareholders mandate is subject to annual renewal and disclosure is made in the annual report of the aggregate value of transactions conducted pursuant to the shareholders mandate during the financial year where in relation to a listed issuer with an issued and paid-up share capital of RM60 million and above; (i) (ii) the consideration, value of the assets, capital outlay or costs of the RRPT is RM1 million or more; or the percentage ratio of such RRPT is 1% or more, whichever is the higher; (c) (d) (e) the issuance of circular to shareholders for the shareholders mandate shall include the information as may be prescribed by the Bursa Securities; in a meeting to obtain the shareholders mandate, the interested director, interested major shareholder or interested person connected with a director or major shareholder; and where it involves the interest of a person connected with a director or major shareholder, such director or major shareholder, must not vote on the resolution approving the transactions. An interested director or interested major shareholder must ensure that persons connected with him abstain from voting on the resolution approving the transactions; and the listed issuer immediately announces to Bursa Securities when the actual value of a RRPT entered by the listed issuer, exceeds the estimated value of the RRPT disclosed in the circular by 10% or more and must include the information as may be prescribed by Bursa Securities in its announcement. 2.2 Background information OIB is an investment holding company and provides management whilst its subsidiary companies are involved in the businesses ranging from commercial and residential property development, general construction to investment holding, hospitality and oil palm cultivation. 2

7 The subsidiary companies of OIB which are involved in the RRPT are set out in the table below: Names of companies Equity interest held Principal activities Aturan Cemerlang Sdn Bhd 73% Investment holding Brilliant Alliance Sdn Bhd 87% Investment holding Maxilux Properties Sdn Bhd 100% Property development OIB Construction Sdn Bhd 90% General construction OIB Management Sdn Bhd 100% Management and maintenance for property and buildings OIB Marketing Sdn Bhd 80% Marketing and sale of land and properties OIB Resort Sdn Bhd 100% Hotel operation and management OIB Services Sdn Bhd 100% Management and property development OIB Properties (C) Sdn Bhd 100% Property development OIB Properties (CV) Sdn Bhd 100% Property development and oil palm cultivation OIB Properties (K) Sdn Bhd 100% Property development and oil palm cultivation OIB Properties (KV) Sdn Bhd 100% Property development OIB Properties (Meru) Sdn Bhd 100% Dormant OIB Properties (PRV) Sdn Bhd 100% Property development OIB Properties (SW) Sdn Bhd 51% Property development and oil palm cultivation Sungei Lalang Development Sdn Bhd 100% Property development Yiked Alliance Sdn Bhd 87% Property development Yiked Brilliant Sdn Bhd 73% Property development OIB Group enters into the RRPT referred to in Section 2.4 which are necessary for the day-to-day operations with the Related Parties in the ordinary course of business. Such RRPT will be carried out at arm s length, on the OIB Group's normal commercial terms and on terms not more favourable to the Related Parties than those generally available to the public and which will not be to the detriment of the minority shareholders of OIB. The transactions may occur in periodic requirements and are not bound by any preceding agreements negotiated in advance. The RRPT will also be subject to the review procedures set out in Section 2.6 below. 2.3 Validity of the Proposed Shareholders Mandate The Proposed Shareholders Mandate, if approved by the OIB shareholders at the forthcoming 22 nd, AGM will take effect from the date of passing of the proposed ordinary resolution at the 22 nd AGM and shall continue to be in force until:- 3

8 (a) (b) (c) the conclusion of the next AGM following the forthcoming 22 nd AGM at which the Proposed Shareholders Mandate is passed, at which time it will lapse, unless the authority is renewed by a resolution passed at the next AGM; or the expiration of the period within which the next AGM is required to be held pursuant to Section 143(1) of the Act (but shall not extend to such extension as may be allowed pursuant to Section 143(2) of the Act); or revoked or varied by resolution passed by the Shareholders in general meeting; whichever is the earlier. Thereafter, the approval from shareholders will be sought for the renewal of the Proposed Shareholders Mandate for RRPT at each subsequent AGM of the Company. Details of RRPT of the Group which are in accordance with Paragraph of the Listing Requirements are set out in the ensuing paragraphs. 2.4 Class and Nature of the RRPT The principal activities of the other related transacting parties The principal activities of the other related transacting parties that will be entering into the RRPT with OIB Group are set out below: Related Transacting Parties Kubang Pasu Development Sendirian Berhad ( KPD ) MDC Precast Industries Sdn Bhd ( MDCPI ) Macro Dimension Concrete Sdn Bhd ( MDCSB ) Mutual Delights Sdn Bhd ( Mutual Delights ) Macro Dimension Sdn Bhd ( MDSB ) Metro Element Sdn Bhd ( MESB ) Glamour Living Sdn Bhd ( GLSB ) Worldbesco Construction Sdn Bhd ( Worldbesco ) ChinHinHome Sdn Bhd ( ChinHinHome ) Eng Chuan Chan Sdn Bhd ( ECC ) Principal activities Property development civil engineering contractor and manufacturing of furniture Manufacturing of precast products Manufacturing and deal with all cement products, bricks and construction General contracting Dealer of sand and quarry Trading in building materials Dealing in all kinds of tiles and ceramic products Construction Property developer Wholesaler of rice, sugar and flour 4

9 Related Transacting Parties Mdcon (Simpang Empat) Sdn Bhd ( Mdcon ) Advance Return Sdn Bhd ( ARSB ) API Precast Marketing Sdn. Bhd. [Formerly known as Key Triumph Sdn. Bhd.] ( API Precast ) Double Benefit Sdn. Bhd. ( DBSB ) Sekalong Sdn. Bhd. ( SSB ) Principal activities Management Services and Sub Contractor Investment Investment Investment Property Investment Company [The rest of this page is intentionally left blank] 5

10 Nature of the RRPT The details of the nature and estimated annual value of the RRPT in respect of which OIB Group is seeking renewal mandate from its shareholders as contemplated under the Proposed Shareholders Mandate are as follows: (a) Proposed Renewal of Shareholders Mandate Provider of goods and Recipient of goods and Nature of Transaction Estimated aggregate value as disclosed in the Circular to Shareholders dated 31 October 2014 Actual value transacted (1) Estimated aggregate value of the transactions during the validity of the Proposed Shareholders Mandate to the next AGM Related Parties MDCPI OIB Group Supply and MDCSB Mutual Delights MDSB MESB GLSB Worldbesco installation of construction materials such as and not limited to tiles, cement and steel OIB Group ChinHinHome Sales and marketing ECC Provision of construction works Mdcon 20,000 - ARSB 60,000 34,108 70,000 Low Ping Kun ( LPK ), Low Kok Kean ( LKK ), Low Kok Shyan, Low Kok Aun ( LKA ), Low Kok Foong ( LKF ) and Low Kok Shen ( LKS ) are major shareholders of OIB and major shareholders of MDCPI, MDCSB, Mutual Delights, MDSB, MESB, GLSB, Worldbesco and ChinHinHome by virtue of their interest in Famivest Sdn Bhd ( Famivest ), a major shareholder of OIB which in turn has interest in MDCPI, MDCSB, Mutual Delights, MDSB, MESB, GLSB, Worldbesco and ChinHinHome. 3,000 1,205 5, ,000 81, ,000 LPK, LKK, Low Kok Shyan, LKA, LKF, Low Peik Shin, Tan Poh Sim, Low Keong Koon, Ooi Lee Yeong and LKS are major shareholders of OIB and major shareholders of ECC by virtue of their interest in LLSB 1980 Holdings Sdn Bhd, a major shareholder of OIB which in turn have interest in ECC. 6

11 Nature of the RRPT (a) Proposed Renewal of Shareholders Mandate (cont d) Provider of goods and Recipient of goods and Nature of Transaction Estimated aggregate value as disclosed in the Circular to Shareholders dated 31 October 2014 Actual value transacted (1) Estimated aggregate value of the transactions during the validity of the Proposed Shareholders Mandate to the next AGM Related Parties LKS, a major shareholder, is also a director of MDSB, MDCSB, Mutual Delights, Worldbesco, ChinHinHome and KPD. LPK, the Executive Director of OIB is also a director of KPD. LKK, the Executive Director of OIB is also a director of ECC. LKA, the Managing Director of OIB is also a Director of all the Related Transacting Parties except for ECC. Low Peik Peng ( LPP ), a person connected to LKK and LKA, is a director of Mutual Delights, MDCPI, MDSB, MDCSB and GLSB. Low Piek Laik, a person connected to LKK and LKA, is a director of GLSB. LKA, LKS and LPP are directors of Mdcon. LKA and LKS are major shareholders of OIB and major shareholders of Mdcon by virtue of their interest in Famivest, a major shareholder of OIB which in turn have interest in Mdcon. 7

12 Nature of the RRPT (a) Proposed Renewal of Shareholders Mandate (cont d) Provider of goods and Recipient of goods and Nature of Transaction Estimated aggregate value as disclosed in the Circular to Shareholders dated 31 October 2014 Actual value transacted (1) Estimated aggregate value of the transactions during the validity of the Proposed Shareholders Mandate to the next AGM Related Parties LPK and Low Kok Horng ( LKH ), the Non- Executive Director of OIB, are directors of ARSB. KPD OIB Group Provision of renovation works, interior design, landscape and maintenance works LPK is a major shareholder of OIB and major shareholder of ARSB by virtue of his interest in LLSB 1980 Holdings Sdn Bhd, a major shareholder of OIB which in turn has interest in ARSB. 10,000 2,388 10,000 LPK, LKK, Low Kok Shyan, LKA, LKF, Low Peik Shin, Tan Poh Sim, Low Keong Koon, Ooi Lee Yeong and LKS are major shareholders of OIB and major shareholders of KPD by virtue of their interest in LLSB 1980 Holdings Sdn Bhd, a major shareholder of OIB which in turn have interest in KPD. LKS, a major shareholder, is also a director of KPD. LPK, LKA and LKH are also directors of KPD. Note (1) The Actual Value transacted of RRPT is from the date on which the existing mandate was obtained up to the LPD before the printing of this Circular. 8

13 Nature of the RRPT The details of the nature and estimated annual value of the RRPT in respect of which OIB Group is seeking fresh mandate from its shareholders as contemplated under the Proposed Shareholders Mandate are as follows: (b) Proposed Additional Shareholders Mandate Provider of goods and Recipient of goods and Nature of Transaction Estimated aggregate value as disclosed in the Circular to Shareholders dated 31 October 2014 Estimated aggregate value of the transactions during the validity of the Proposed Shareholders Mandate to the next AGM Related Parties API Precast OIB Group Supply and installation of construction materials such as and not limited to tiles, cement and steel OIB Group DBSB Provision of SSB construction works - 30,000 LKA is a director of API Precast. LKK and LKA are major shareholders of OIB and major shareholders of API Precast by virtue of their interest in LLSB 1980 Holdings Sdn Bhd, a major shareholder of OIB which in turn have interest in API Precast. - 20,000 LPK and LKH are directors of DBSB. LPK is a major shareholder of OIB and major shareholder of DBSB by virtue of his interest in Ripro Sdn Bhd, a major shareholder of OIB which in turn has interest in DBSB. LPK and Low Keong Koon are directors of SSB and are major shareholders of OIB and major shareholders of SSB by virtue of their interest in LLSB 1980 Holdings Sdn Bhd, a major shareholder of OIB which in turn have interest in SSB. 9

14 2.5 RRPT as at financial year ended 30 June 2015 Details of RRPT transacted during the financial year ended 30 June 2015 pursuant to the shareholders mandate obtained by the Company at the Annual General Meeting held on 25 November 2014 are as follows: Provider of goods and Recipient of goods and Nature of Transaction Actual value transacted Related Parties MDCPI MDCSB Mutual Delights MDSB MESB GLSB OIB Group Supply and installation of construction materials such as and not limited to tiles, cement and steel Worldbesco OIB Group ChinHinHome Sales and marketing ECC Provision of construction works 36,992 Low Ping Kun ( LPK ), Low Kok Kean ( LKK ), Low Kok Shyan, Low Kok Aun ( LKA ), Low Kok Foong ( LKF ) and Low Kok Shen ( LKS ) are major shareholders of OIB and major shareholders of MDCPI, MDCSB, Mutual Delights, MDSB, MESB, GLSB, Worldbesco and ChinHinHome by virtue of their interest in Famivest Sdn Bhd ( Famivest ), a major shareholder of OIB which in turn has interest in MDCPI, MDCSB, Mutual Delights, MDSB, MESB, GLSB, Worldbesco and ChinHinHome. 1,437 80,832 LPK, LKK, Low Kok Shyan, LKA, LKF, Low Peik Shin, Tan Poh Sim, Low Keong Koon, Ooi Lee Yeong and LKS are major shareholders of OIB and major shareholders of ECC by virtue of their interest in LLSB 1980 Holdings Sdn Bhd, a major shareholder of OIB which in turn have interest in ECC. LKS, a major shareholder, is also a director of MDSB, MDCSB, Mutual Delights, Worldbesco, ChinHinHome and KPD. LPK, the Executive Director of OIB is also a director of KPD. LKK, the Executive Director of OIB is also a director of ECC. LKA, the Managing Director of OIB is also a Director of all the Related Transacting Parties except for ECC. Low Peik Peng ( LPP ), a person connected to LKK and LKA, is a director of Mutual Delights, MDCPI, MDSB, MDCSB and GLSB. Low Piek Laik, a person connected to LKK and LKA, is a director of GLSB. OIB Group Mdcon Provision of construction works ARSB - LKA, LKS and LPP are directors of Mdcon. 10

15 Provider of goods and Recipient of goods and Nature of Transaction Actual value transacted Related Parties LKA and LKS are major shareholders of OIB and major shareholders of Mdcon by virtue of their interest in Famivest, a major shareholder of OIB which in turn have interest in Mdcon. LPK and LKH, the Non-Executive Director of OIB, are directors of ARSB. LPK is a major shareholder of OIB and major shareholder of ARSB by virtue of his interest in LLSB 1980 Holdings Sdn Bhd, a major shareholder of OIB which in turn has interest in ARSB. KPD OIB Group Provision of renovation works 2,675 LPK, LKK, Low Kok Shyan, LKA, LKF, Low Peik Shin, Tan Poh Sim, Low Keong Koon, Ooi Lee Yeong and LKS are major shareholders of OIB and major shareholders of KPD by virtue of their interest in LLSB 1980 Holdings Sdn Bhd, a major shareholder of OIB which in turn have interest in KPD. LKS, a major shareholder, is also a director of KPD. LPK, LKA and LKH are also directors of KPD. 2.6 Amount Due and Owing Under RRPT As at the financial year ended 30 June 2015, the outstanding amount due and owing to OIB Group arising from RRPT as per Section 2.4 which has exceeded the credit term are as follows:. No. Transacting Parties Exceeding credit term but 1 year Principal Interest Principal > 1 year to 3 years Interest > 3 years to 5 years Principal Interest Principal > 5 years Interest 1 ChinHinHome *26, MDCPI MDCSB GLSB # (3,866) There are no late payment charges on the overdue trade receivables as the Group has decided not to impose any late payment charges. The senior management has and will continue to meet and discuss with the related parties to pursue for early settlement of the outstanding amounts. The Audit Committee and Board of Directors have reviewed the outstanding amounts, and are of the opinion that the outstanding amounts were part of normal business operations of the Group and are recoverable. In addition, the management is of the view that the related parties are long term business counter-party and have sound credit standing. The total outstanding amount due and owing by the above related parties of *RM million and # RM3.866 million respectively have been settled as at LPD. 11

16 2.7 Method or Procedures on Which Transaction Prices are Determined/Review Procedures for Recurrent Party Transactions The OIB Group has implemented the following procedures to supplement existing internal procedures for general transactions to ensure that the RRPT are undertaken on an arm's length basis and on normal commercial terms and on terms not more favourable to the Related Parties than those generally extended to third parties. The review procedures are as follows:- (a) (b) (c) (d) (e) (f) (g) (h) An approved list of Related Parties will be provided to the relevant personnel within OIB Group and at the same time, the Related Party will be notified that all related party transactions are required to be undertaken on arm's length basis and on normal commercial terms. In addition, an approval has to be obtained from the Board and the ARMC before entering into any transactions with new related party; One (1) Senior Management and one (1) Executive Director of OIB will review all RRPT. Senior Management consists of Managers and Directors of subsidiaries of OIB Group; Records are maintained by OIB Group to capture all RRPT, which are entered into pursuant to the shareholders' mandate. Reports thereof are circulated to the ARMC on quarterly basis for its notation, review and monitoring of such RRPT. The annual internal audit plan shall incorporate a review of all RRPT, which are entered into pursuant to the shareholders' mandate to ensure that the relevant approvals have been obtained and review procedures in respect of such transactions are adhered to; The ARMC shall review the internal audit reports to ascertain that the guidelines and procedures established to monitor RRPT have been complied with and the review shall be done at least once a year; The Board and the ARMC have reviewed the procedures and shall continue to review the procedures as and when required, with the authority to sub-delegate to individuals or committee within OIB Group, as they deem appropriate. If a member of the Board or the ARMC has an interest in the transaction to be reviewed by the Board or the ARMC has an interest in the transaction to be reviewed by the Board or the ARMC as the case may be, he will abstain from any decisionmaking by the Board or the ARMC in respect of the transaction; The transaction prices, terms and conditions are determined by market forces, under similar commercial terms for transactions with third parties, which are dependent on the demand and supply of the products/. In addition, quotations will be obtained from unrelated third parties for similar products/ as comparison, to arrive at true and fair evaluation and ranking on the price, delivery, and other terms and conditions before entering into such transaction; At least two (2) other contemporaneous transactions with unrelated third parties for similar products/ and/ or qualities will be used as comparison, wherever possible, to determine whether the price and terms offered to/ by the Related Parties are fair and reasonable and comparable to those offered to/by other unrelated third parties for the same or substantially similar type of products/ and/ or quantities; 12

17 (i) (j) In the event that a quotation or comparative pricing from unrelated third party cannot be obtained, for instance where the vendor is the sole distributors/ agents or an in-depth knowledge, understanding and evaluation of the requirements of the industry are critical for the product/ service offered, the transaction price will be determined based on the usual business practice of the Group to ensure that the RRPT is not detrimental to the Group; and The cost plus method, where applicable, may be used to determine the transaction price. The transaction price however must be reviewed and approved by the ARMC. This method is determined at arm's length price by adding an appropriate mark-up to the cost of construction which will be determined at usual commercial terms. The appropriate mark-up is the percentage earned by the Group on normal non-related party transactions/sales which are the same in accordance with industry norm. 2.8 Threshold for Approval of RRPT There are no specific thresholds for approval of RRPT within the Group. However, all RRPT are subject to the review and/or approval of the appropriate level of authority pursuant to the procedures as disclosed in section 2.6 above set by the ARMC, subject to the provisions in the Listing Requirements and / or the Act, depending on the type of transactions, to ensure the RRPT will be carried out on arm s length basis; on transaction price and on terms not more favourable to the Related Parties than those generally available to the public; and are not to the detriment of the minority shareholders. 2.9 Disclosure in the Annual Report Disclosure will be made in OIB s Annual Report of the breakdown of the aggregate value of the RRPT made during the financial year, types of transactions made, names of the related parties involved and their relationship with the OIB Group pursuant to the Proposed Shareholders Mandate in accordance with paragraph 10.09(2) and Practice Note No. 12 of the Listing Requirements Deviation from mandate The actual value of RRPT did not exceed 10% of the estimated value as approved under the previous shareholders mandate granted to the Company at the last AGM Statement by the ARMC The ARMC of OIB has seen and reviewed the procedures mentioned in 2.6 above and is of the opinion that the abovementioned procedures, as well as the periodic reviews to be made by the ARMC in relation thereto, are sufficient to ensure that the RRPT are carried out on terms not more favourable to the Related Parties than those generally available to the public and are not detrimental to the interests of the minority shareholders. The ARMC is also of the view that OIB Group has in place adequate procedures and processes to monitor, track and identify RRPT in a timely and orderly manner and such procedures and processes are reviewed by the ARMC and/or the management staff as and when necessary. 13

18 3.0 RATIONALE FOR, AND THE BENEFIT TO THE OIB GROUP FROM TRANSACTING WITH ALL CLASSES OF RELATED PARTIES The Proposed Shareholders Mandate, which is subject to annual review will enable the Group to enter into RRPT which are in the ordinary course of the Group s businesses, on normal commercial terms, in a timely manner. This will enable the Group to continue to carry out RRPT necessary for the Group s dayto-day operations thus enhancing the Group s ability to pursue business opportunities which are timesensitive in nature in a more efficient manner by transacting with the Related Parties. The Group will have an advantage of familiarity with the background, Management and the financial well-being of the Related Parties which will enable a more informed commercial decision to be made by the Group in a timely manner. By obtaining the shareholders mandate and the renewal thereof on an annual basis would eliminate the necessity to convene separate general meetings from time to time to seek shareholders' approval as and when such RRPT of a revenue or trading nature arise, thereby reducing substantial administrative time and costs associated with the convening of such general meetings, without compromising the corporate objective or adversely affecting the business opportunities available to OIB Group. The RRPT are essential to provide OIB Group with the support for its operational business opportunities and further enhance its ability to explore beneficial business opportunities. 4.0 CONDITION(S) FOR THE PROPOSED SHAREHOLDERS MANDATE The Proposed Shareholders Mandate is conditional upon approval being obtained from shareholders at the forthcoming 22 nd AGM. 5.0 FINANCIAL EFFECTS OF THE PROPOSED SHAREHOLDERS MANDATE The Proposed Shareholders Mandate is not expected to have any effect on the issued and paid-up share capital, shareholdings of substantial shareholders or material effects on earnings and net assets of the OIB Group for the financial year ending 30 June DIRECTORS' AND MAJOR SHAREHOLDERS INTERESTS The direct and indirect interest of the interested Major Shareholders and the interested Directors of OIB and Persons Connected with them as at LPD are summarised below: Interested Major Shareholders of OIB Direct Shareholdings Indirect Shares % Shares % Jupiter Sunrise Sdn Bhd 65,548, Famivest Sdn Bhd* ,548, Ripro Sdn Bhd* ,548, Kemboja Jati Sdn Bhd* ,548, LLSB 1980 Holdings Sdn Bhd* ,548, LLS & Sons Sdn Bhd ( LLS & Sons ) * ,548,

19 Interested Major Shareholders of OIB Shareholdings Direct Indirect Shares % Shares % Low Keong Koon Sdn Bhd* ,548, Low Ping Kun Sdn Bhd* ,548, Low Ping Kun* ,548, Low Kok Kean* ,548, Low Kok Aun* ,548, Low Kok Shyan* ,548, Low Peik Shin* ,548, Low Keong Koon* ,548, Low Kok Foong* ,548, Low Kok Shen* ,548, Ooi Lee Yeong* ,548, Tan Poh Sim* ,548, Tan Eian Hoe* ,548, Tan Swee Huat Sdn Bhd* ,548, Tan Ean Poe* ,548, Tan Yen Sooh* ,548, Tan Swee Bee Sdn Bhd* ,548, Tan Yen Tong* ,548, Tan Yean Sim* ,548, HSPS Holdings Sdn Bhd* ,548, Tan Ean Pin* ,548, Tan Ean See* ,548, Tan Chang Tok Sdn Bhd* ,548, Tan Ean Hoon* ,548, Tan Chung Yi* ,548, Note: * Deemed interested pursuant to Section 6A of the Act. Interested Directors of OIB Shareholdings Direct Indirect Shares % Shares % Low Kok Kean* ,548, Low Kok Aun* ,548, Low Ping Kun* ,548, Note: * Deemed interested pursuant to Section 6A of the Act. 15

20 As at the LPD, none of the Interested Persons Connected to the Directors and Major Shareholders of OIB has any direct and/or indirect shareholdings in OIB. The abovementioned Interested Related Parties will abstain and have undertaken to ensure that Persons Connected with them will abstain from voting, deliberating or approving in respect of their direct and indirect interests in OIB on the ordinary resolution pertaining to the Proposed Shareholders Mandate at the forthcoming 22 nd AGM. Save as disclosed, none of the other Directors and Major Shareholders of OIB and/or Persons Connected with them, has any interest, direct or indirect in the Proposed Shareholders Mandate. LKA, LKK and LPK had abstained and will continue to abstain from Board deliberation and voting in respect of their direct and indirect interests in OIB on the proposed ordinary resolution pertaining to the Proposed Shareholders Mandate in which they are interested at the Board level. 7.0 DIRECTORS' RECOMMENDATION The Board of Directors (with the exception of LKA, LKK and LKP who had abstained from expressing any opinion and recommendation in relation to the Proposed Shareholders Mandate in view of their interests) having considered all aspects of the Proposed Shareholders Mandate, is of the opinion that it is in the best interest of the OIB Group and accordingly, recommend that you vote in favour of the ordinary resolution on the Proposed Shareholders Mandate to be tabled at the forthcoming 22 nd AGM. 8.0 AGM The 22 nd AGM, the notice of which is set out in enclosed in this circular, will be held at Dewan Bankuet Jubli Emas, Royal Kedah Club, Pumpong, Alor Setar, Kedah Darul Aman on Monday, 23 November 2015 at a.m. for the purpose of considering and, if thought fit, passing with or without any modifications to the ordinary resolution to give effect to the Proposed Shareholders Mandate under the Special Business in the 22 nd AGM. If you are unable to attend and vote at the 22 nd AGM, please complete the Form of Proxy and forward it to the Registered Office of the Company at Lot 6.05, Level 6, KPMG Tower, 8 First Avenue, Bandar Utama, Petaling Jaya, Selangor Darul Ehsan, so as to arrive at least forty-eight (48) hours before the time fixed for the holding of the 22 nd AGM or any adjournment thereof. The Form of Proxy should be completed strictly in accordance with the instructions contained therein. The lodging of the Form of Proxy will not preclude you from attending and voting in person at the 22nd AGM should you subsequently wish to do so. 9.0 FURTHER INFORMATION Shareholders are requested to refer to the attached Appendix A contained in this Circular for further information. Yours faithfully, For and on behalf of the Board of ORIENTAL INTEREST BERHAD DATO WIRA LIM TEONG KIAT Independent Non-Executive Chairman 16

21 APPENDIX A FURTHER INFORMATION 1. RESPONSIBILITY STATEMENT This Circular has been seen and approved by the Board and the Directors collectively and individually accept full responsibility for the accuracy of the information given herein and confirm that after making all reasonable enquiries and to the best of their knowledge and belief, there are no other facts, the omission of which would make any statement herein misleading. 2. MATERIAL LITIGATION Neither OIB nor any of its subsidiaries is engaged in any material claims, litigation and/or arbitration either as plaintiff or defendant, which has a material effect on the financial position of OIB Group and our Directors are not aware of any proceedings pending or threatened, against OIB Group or of any fact likely to give rise to any proceedings which might materially and adversely affect the position or business of OIB Group immediately preceding the date of this Circular. 3. MATERIAL CONTRACTS Neither the Company nor any of its subsidiary companies has entered into any material contracts (not being contracts entered into in the ordinary course of business) within 2 years immediately preceding the date of this Circular. 4. DOCUMENTS AVAILABLE FOR INSPECTION Copies of the following documents are available for inspection at the registered office of OIB at Lot 6.05, Level 6, KPMG Tower, 8 First Avenue, Bandar Utama, Petaling Jaya, Selangor Darul Ehsan during normal office hours from Mondays to Fridays (except public holidays) from the date of this Circular up to the time set for convening the 22 nd AGM:- (a) (b) Memorandum and Articles of Association of OIB; Audited consolidated financial statements of OIB for the past two (2) financial years ended 30 June 2014 and 30 June

22 ORIENTAL INTEREST BERHAD (Company No M) (Incorporated in Malaysia under the Companies Act, 1965) NOTICE IS HEREBY GIVEN that the Twenty-Second (22 nd ) Annual General Meeting ( AGM ) of ORIENTAL INTEREST BERHAD ( OIB or the Company ) will be held at Dewan Bankuet Jubli Emas, Royal Kedah Club, Pumpong, Alor Setar, Kedah Darul Aman on Monday, 23 November 2015 at a.m. for the following purposes: AGENDA AS ORDINARY BUSINESS 1. To receive the Audited Financial Statements for the financial year ended 30 June 2015 together with the Reports of the Directors and Auditors thereon. 2. To re-elect the following Directors retiring pursuant to Article 80 of the Articles of Association of the Company: (a) Dato Wira Lim Teong Kiat (b) Mr Low Ping Kun Ordinary Resolution 1 Ordinary Resolution 2 3. To approve the payment of Directors fees for the financial year ended 30 June Ordinary Resolution 3 4. To re-appoint Messrs KPMG and to authorise the Directors to fix their remuneration. Ordinary Resolution 4 AS SPECIAL BUSINESS To consider and if thought fit, pass the following resolutions with or without modifications. 5. AUTHORITY TO ALLOT AND ISSUE SHARES BY DIRECTORS PURSUANT TO SECTION 132D OF THE COMPANIES ACT, 1965 THAT pursuant to Section 132D of the Companies Act, 1965 ( the Act ), the Directors be and are hereby empowered to allot and issue shares in the Company, at any time, at such price, upon such terms and conditions, for such purpose and to such person or persons whomsoever as the Directors may in their absolute discretion deem fit, provided that the aggregate number of shares to be issued does not exceed ten per centum (10%) of the issued share capital of the Company at the time of issue and THAT the Directors be and are hereby also empowered to obtain the approval for the listing of and quotation for the additional shares so issued on the Bursa Malaysia Securities Berhad and THAT such authority shall continue to be in force until the conclusion of the next Annual General Meeting of the Company. 6. PROPOSED ADDITIONAL AND RENEWAL OF SHAREHOLDERS MANDATE FOR RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE THAT, subject to the provisions of the Listing Requirements of Bursa Malaysia Securities Berhad, approval be and is hereby given to OIB and its subsidiaries ( the Group ) to enter into and to give effect to the recurrent related party transactions of a revenue or trading nature as specified in Section 2 of the Circular to Shareholders dated 30 October 2015, provided that such arrangements and/or transactions which are necessary for the Group s day to day operations are undertaken in the ordinary course of business, at arm s length basis, on normal commercial terms which are not more favourable to the related parties than those generally available to the public and not detrimental to the minority shareholders of the Company ( Proposed Additional and Renewal of Shareholders Mandate ) and the shareholders mandate is subject to annual renewal and disclosure being made in the Annual Report of aggregate value of transactions conducted pursuant to the shareholders mandate during the financial year and that such approval shall continue to be in force until: Ordinary Resolution 5 Ordinary Resolution 6 18

23 (i) the conclusion of the next AGM of the Company at which time it will lapse, unless by a resolution passed at the said AGM, the authority is renewed; or (ii) the expiration of the period within which the next AGM after the date it is required to be held pursuant to Section 143(1) of the Act (but shall not extend to such extension as may be allowed pursuant to Section 143(2) of the Act); or (iii) revoked or varied by resolution passed by the shareholders of the Company in general meeting, whichever is the earlier. AND THAT the Directors of the Company be and are hereby authorised to complete and do all such acts and things as they may consider expedient or necessary or in the best interest of the Company to give effect to the Proposed Additional and Renewal of Shareholders Mandate. 7. PROPOSED BONUS ISSUE OF 54,327,001 NEW ORDINARY SHARES OF RM1.00 EACH IN OIB ( OIB SHARES ) ( BONUS SHARE(S) ) TO BE CREDITED AS FULLY PAID-UP AT PAR, ON THE BASIS OF THREE (3) BONUS SHARES FOR EVERY FIVE (5) EXISTING OIB SHARES HELD BY THE ENTITLED SHAREHOLDERS OF OIB ON AN ENTITLEMENT DATE TO BE DETERMINED LATER ( PROPOSED BONUS ISSUE ) THAT, subject to the approvals of all relevant authorities and/or parties (where required) for listing of and quotation for the new OIB Shares to be issued hereunder, authority be and is hereby given to the Board of Directors of the Company ( Board ) to capitalise up to RM54,327,001 from the share premium and retained earnings of the Company and the same be applied for the allotment and issuance of 54,327,001 new OIB Shares, credited as fully paid-up at par, to the shareholders of the Company whose names appear in the Record of Depositors of the Company as at the close of business on an Entitlement Date to be determined later by the Board, on the basis of three (3) Bonus Shares for every five (5) existing OIB Shares held. Ordinary Resolution 7 THAT the Board be and is hereby authorised to deal with any fractional entitlements of the new OIB Shares that may arise from the Proposed Bonus Issue, in such manner as the Board deems fit and expedient in the best interest of the Company. THAT the Bonus Shares to be issued pursuant to the Proposed Bonus Issue shall upon allotment and issuance, rank pari passu in all respect with the existing OIB Shares, save and except that they shall not be entitled to any dividends, rights, allotment and/or other forms of distribution that may be declared, made or paid where the entitlement date precedes the date of allotment and issuance of the Bonus Shares. AND THAT the Board be and is hereby authorised to take all such necessary steps to give effect to the Proposed Bonus Issue with full powers to assent to any conditions, variations, modifications and/or amendments in any manner as may be required by the relevant authorities or deemed by the Board to be in the best interest of the Company, and to take all steps and to do all such acts and matters as they may consider necessary or expedient to implement, finalise and give full effect to the Proposed Bonus Issue. 8. To transact any other business of which due notice shall have been given. By Order of the Board TAI YIT CHAN (MAICSA ) ONG TZE-EN (MAICSA ) Company Secretaries Selangor Darul Ehsan 30 October

24 Notes: 1. A member of the Company entitled to attend and vote at the meeting is entitled to appoint a proxy or proxies to attend and vote in his stead. A proxy may but need not be a member of the Company. A member may appoint any person to be his proxy without limitation and the provision of Section 149(1)(b) of the Companies Act, 1965 shall not apply. 2. A member shall not be entitled to appoint more than two (2) proxies to attend and vote at the same meeting and where a member appoints two (2) proxies the appointments shall be invalid unless he specifies the proportions of his shareholdings to be represented by each proxy. 3. Where a member is an Exempt Authorised Nominee which holds ordinary shares in the Company for multiple beneficial owners in one securities account ( omnibus account ) as defined under the Securities Industry (Central Depositories) Act, 1991, there is no limit to the number of proxies which the Exempt Authorised Nominee may appoint in respect of each omnibus account it holds. 4. The instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorised in writing or, if the appointor is a corporation, either under the corporation s seal or under the hand of an officer or attorney duly authorised. 5. The instrument appointing a proxy, with the power of attorney or other authority (if any) under which it is signed or a notarially certified or office copy of such power or authority, shall be deposited at the Registered Office of the Company at Lot 6.05, Level 6, KPMG Tower, 8 First Avenue, Bandar Utama, Petaling Jaya, Selangor Darul Ehsan not less than 48 hours before the time set for holding the meeting or any adjournment thereof. 6. In respect of deposited securities, only members whose names appear on the Record of Depositors on 16 November 2015 (General Meeting Record of Depositors) shall be eligible to attend the meeting or appoint proxy(ies) to attend and/or vote on his behalf. Explanatory Note To receive the Audited Financial Statements Agenda item No. 1 is meant for discussion only as Section 169(1) of the Act does not require a formal approval of shareholders of the Company and therefore, this item is not put forward for voting. Ordinary Resolution 5 Authority to Issue Shares Pursuant to Section 132D of the Companies Act, 1965 The proposed Ordinary Resolution 5, if passed, will empower the Directors to issue shares up to an aggregate amount not exceeding 10% of the issued and paid-up share capital of the Company for the time being, for such purposes as the Directors consider would be in the best interest of the Company without having to convene separate general meetings. This authority, unless revoked or varied at a general meeting, will expire at the conclusion of the next AGM. This is a renewal of the mandate obtained from its shareholders at the last AGM held on 25 November 2014 and will provide flexibility to the Company for any possible fund raising activities, including but not limited to further placement of shares for purpose of funding future investment, working capital and/or acquisitions. The Company had not issued any new shares pursuant to Section 132D of the Act, under the general mandate which was approved at the Twenty-First AGM of the Company. Ordinary Resolution 6 Proposed Additional and Renewal of Shareholders Mandate The proposed Ordinary Resolution 6, if passed, will approve the Proposed Additional and Renewal of Shareholders Mandate and allow the Company and its subsidiaries to enter into recurrent related party transactions as set out in Section 2 of the Circular to the Shareholders in relation to the Proposed Additional and Renewal of Shareholders Mandate dated 30 October Ordinary Resolution 7 Proposed Bonus Issue The proposed Ordinary Resolution 7, if passed, will approve the Proposed Bonus Issue which is to reward OIB s shareholders for their continued support and loyalty to OIB. It is also to increase the number of OIB Shares held by the shareholders of OIB whilst maintaining their percentage of equity interest in the Company. Further details are set out in the Circular to the Shareholders in relation to the Proposed Bonus Issue dated 30 October Statement Accompanying Notice of AGM (Pursuant to Paragraph 8.27(2) of the Main Market Listing Requirement) No individual is standing for election as a Director at the forthcoming Twenty-Second AGM of the Company. 20