The Board of Directors of NPC Resources Berhad ("NPC" or "the Company") is pleased to announce the following:

Transcription

1 ANNOUNCEMENT PROPOSED DISPOSAL OF THE ENTIRE EQUITY INTEREST IN SUNGAI RUKU OIL PALM PLANTATION SDN BHD ( SROPP ), A WHOLLY OWNED SUBSIDIARY OF NPC RESOURCES BERHAD ( NPC ); AND PROPOSED DISPOSAL OF A PARCEL OF AGRICULTURAL LAND BY AGRISA TRADING SDN BHD ( ATSB ), A WHOLLY OWNED SUBSIDIARY OF NPC COLLECTIVELY KNOWN AS ( PROPOSED DISPOSALS ) The Board of Directors of NPC Resources Berhad ("NPC" or "the Company") is pleased to announce the following: 1. INTRODUCTION The Company ( Shares Vendor ) has on 29 th September 2016 entered into a Conditional Sale and Purchase Agreement ( Share Sale SPA ) with Budaya Potensi Sdn Bhd (Company No A) ( BPSB ) ( the Purchaser ) in relation to the proposed disposal of its entire equity interest in Sungai Ruku Oil Palm Plantation Sdn Bhd ( P) ( SROPP ) comprising 3,000,000 ordinary shares of RM1.00 each in SROPP ( the Share Sale ) at a consideration sum of RM35,500, (Ringgit Malaysia Thirty Five Million and Five Hundred Thousand) only [gross share sale consideration before the deduction of the existing bank liabilities] payable by BPSB for the Share Sale ( Share Sale Disposal Consideration ). SROPP is the equitable and beneficial owner of a palm oil mill erected on a parcel of agricultural land ( said Palm Oil Mill ) and located within the land held under Country Lease No , located at Segaliud-Lokan, District of Kinabatangan, State of Sabah ( the said Land ) registered in the name of Agrisa Trading Sdn Bhd (Company No M) ( ATSB ). The Share Sale is to be sold en-bloc with the disposal of the said Land entered between ATSB and BPSB. On the same date, ATSB ( the Land Vendor ) had entered into a Conditional Sale & Purchase Agreement ( Land SPA ) with BPSB in relation to the disposal of the said Land at a sales consideration of RM12,000, (Ringgit Malaysia Twelve Million) only ( Land Disposal Consideration ). The Share Sale together with all rights, benefits and entitlements now or hereafter attaching thereto with all the estate right benefit and title attached to the said Palm Oil Mill and three fresh fruit bunches collection stations, and goodwill of SROPP free from all or any charges, equitable charges, mortgage, adverse claim, liens, trusts, pledges, charges, free from encumbrances created or secured by the bank liabilities and other encumbrances whatsoever and with all rights now or hereafter attaching thereto together with all rights privileges and advantages attached to all applications, licence and permits approved and or pending approval to SROPP and for the consideration and upon the terms and conditions specified in the Share Sale SPA. Following the Completion (as defined in Section 6.2 of this Announcement) of the Proposed Disposals, SROPP shall cease to be subsidiary of NPC.

2 2. BACKGROUND INFORMATION ON SROPP, THE LAND VENDOR AND BPSB a. Background of SROPP SROPP was incorporated in Malaysia on 24 October 1984 under the Companies Act, 1965 ( Act ) as a private limited company. The principal activity of SROPP is milling and sale of oil palm products. As at 29 th September 2016 (the latest practicable date of this announcement ( LPD )), the authorised share capital of SROPP is RM5,000, consisting of 5,000,000 ordinary shares, of which only RM3,000, consisting of 3,000,000 ordinary shares have been issued and fully paid-up. SROPP s directors are as follows: a. Loo Ngin Kong b. Dato Loo Pang Kee c. Wong Siew Ying b. Background of ATSB ATSB was incorporated in Malaysia on 11 June 1983 under the Companies Act, 1965 ( Act ) as a private limited company. ATSB is a wholly owned subsidiary of NPC and its nature of business is operation of an oil palm plantation. As at the date of this announcement, ATSB has an authorized share capital of RM5,000, comprising 5,000,000 ordinary shares of RM1.00 each of which 4,470,000 ordinary shares have been issued and fully paid-up. ATSB s directors are as follows: a. Loo Ngin Kong b. Dato Loo Pang Kee c. Wong Siew Ying c. Background of BPSB BPSB was incorporated in Malaysia on 11 September 2008 under the Companies Act, 1965 ( Act ) as a private limited company. BPSB is a subsidiary of Palm Plenteous Sdn. Bhd. (Company No T) (PPSB). BPSB has yet to commence operation during the financial year ended 31 December As at the date of this announcement, BPSB has an authorized share capital of RM1,000, comprising 1,000,000 ordinary shares of RM1.00 each of which 200,000 ordinary shares have been issued and fully paid-up.

3 2. BACKGROUND INFORMATION ON SROPP, THE LAND VENDOR AND BPSB (Continued) c. Background of BPSB (Continued) BPSB s directors and shareholders and their shareholdings are as follows: Directors and Shareholders Name Designation Shareholdings Percentage Lim Thou Tun Director 59, Tan Cheu Khea Director 25, Choo Kuan Yen Director - - Tan Cheong Leong Director - - Wee Peir Seng - 16, PPSB - 100, Total 200, The above persons have no connections to any directors, major shareholders and or persons connected to the directors and or the major shareholders of NPC. 3. INFORMATION ON THE PROPERTIES 3.1 The details of the Properties are as per the table below: Title Number Location Area (Ha) Lease Expiry date CL KM87, Segaliud Lokan, District of Kinabatangan, in the State of Sabah The information of the Properties is as set out below: Usage Area (ha) Oil palm cultivation (years of planting) Palm oil mill Others (1) Total Note (1): Consists of infrastructures and slopes. The production record in metric tonnes (MT) for the past three (3) years from 2013 to 2015 are set out below: (MT) (MT) (MT) Fresh fruit bunch ( FFB ) Upon disposal of the said Land, ATSB will have remaining of ha of agricultural land and the disposal does not affect the principal operation of ATSB.

4 3. INFORMATION ON THE PROPERTIES (Continued) 3.3 The details of encumbrances are as follow: (a) (b) The said Land is presently subject to charge in favour of AmBank (M) Berhad (8515-D) of Labuan Offshore Branch, Level 12(B), Block 4 Office Tower, Financial Park Labuan Complex, Jalan Merdeka, Federal Territory of Labuan, Malaysia pursuant to Facility Agreement dated AND AmIslamic Bank Berhad ( U) of Wholesale Banking Sabah, Level 6, Wisma Fook Loi, No. 38, Jalan Gaya, Kota Kinabalu, Sabah pursuant to an Facility Agreement dated The said Palm Oil Mill is presently subject to charge in favour of AmBank (M) Berhad (8515-D) of Labuan Offshore Branch, Level 12(B), Block 4 Office Tower, Financial Park Labuan Complex, Jalan Merdeka, Federal Territory of Labuan, Malaysia pursuant to Facility Agreement dated AND AmIslamic Bank Berhad ( U) of Wholesale Banking Sabah, Level 6, Wisma Fook Loi, No. 38, Jalan Gaya, Kota Kinabalu, Sabah pursuant to an Facility Agreement dated BASIS OF ARRIVING AT THE DISPOSALS CONSIDERATION 4.1 Disposal of the Share Sale The SROPP Shares are disposed free from encumbrances and the Share Sale Disposal Consideration was arrived at based on mutual agreement following negotiations between NPC and BPSB. The Share Sale Disposal Consideration was arrived after taking into consideration of the following: a. As at 31 December 2015, SROPP s audited net assets is RM25,916,731 and the said Palm Oil Mill and other fixed assets have a total net book value of RM14,648,213; and b. estimated gain on disposal of approximately RM9.6 million. 4.2 Disposal of the Land The said Land is to be sold on a as is where is basis, free from all liens, encumbrances, caveats and other restraints at the agreed price of RM12,000, (Ringgit Malaysia Twelve Million) only. The Land Disposal Consideration was arrived at on a willing buyer and willing seller basis after taking into consideration of the following: a. The net profit before tax of the said Land as at 31 December 2015 is approximately RM152,000 only (on pro-rata basis); b. The said Land has a total net book value of approximately RM1.05 million as at 31 December 2015; and c. estimated gain on disposal of approximately RM11 million. 5. LIABILITIES TO BE ASSUMED BY BPSB There are no liabilities to be assumed by BPSB.

5 6. SALIENT TERMS AND CONDITIONS OF THE SHARE SALE SPA 6.1 Mode of Satisfaction of the Share Sale Disposal Consideration and Completion Date The Share Sale Disposal Consideration shall be payable by the BPSB in the following manner: (a) the Earnest Sum in the sum of Ringgit Malaysia Three Hundred Thousand (RM300,000.00) only paid to the Shares Vendor prior to execution of the Share Sale SPA to secure the purchase of the Share Sales, which shall form part of the Share Sale Deposit Sum; (b) (c) (d) (e) a further sum of RM3,250, (Ringgit Malaysia Three Million Two Hundred Fifty Thousand) only paid to the Shares Vendor s stakeholders in the following manner upon execution of the Share Sale SPA which shall also be treated as Share Sale Deposit Sum: (i) An amount for retention sum as advised by the Shares Vendor s tax consultant payable to Ketua Pengarah Hasil Dalam Negeri for Real Property Gains Tax to be remitted to the Inland Revenue Department, such payment when made shall be deemed payment to the Shares Vendor; and (ii) The balance of the Share Sale Deposit Sum after the deduction of the retention sum under Section 6.1(b)(i) to the Shares Vendor. the balance sum of RM31,950, (Ringgit Malaysia Thirty-One Million Nine Hundred Fifty Thousand) only shall be paid in full to the Shares Vendor s stakeholder on or before the Completion Date or the Extended Date, as the case may be, to be released to the Shares Vendor subject to the following: (i) The Balance Sum payable to the Shares Vendor shall be subject to deduction in full settlement of SROPP s existing bank liabilities; (ii) upon receipt by BPSB s Solicitors of the written confirmation from SROPP s Secretary that the changes in the directors, shareholders and company secretary(ies) of SROPP in favour of BPSB or its nominee(s) have been duly lodged with and accepted by Suruhanjaya Syarikat Malaysia; (iii) upon full settlement of the SROPP s existing bank liabilities and upon receipt of the satisfaction of charge duly executed by the existing bank and/or the release of debenture and/or any other satisfactory proof that the encumbrances have been settled and/or released (iv) the successful registration of the said Land in favour of BPSB. The Completion Date shall be Four (4) Months from the date of execution of the Share Sale SPA by both parties (hereinafter referred as Completion Date ); The extended completion date shall the period of Two (2) months from the Completion Date subject to late payment interest at the rate of eight per centum (8%) per annum on the outstanding Balance Sum calculating on daily basis from the Completion Date until the date the Balance Sum is settled in full to the Share Vendor s Solicitors as stakeholders (hereinafter referred as Extended Completion Date );

6 6. SALIENT TERMS AND CONDITIONS OF THE SHARE SALE SPA (Continued) 6.1 Mode of Satisfaction of the Share Sale Disposal Consideration and Completion Period (Continued) (f) (g) Within one (1) month from the execution of the Share Sale SPA, the Shares Vendor shall deposit a listing of various documents ( the Staked Documents ) of the SROPP with the Shares Vendor s Solicitors as stakeholder and the Shares Vendor s Solicitors are irrevocably authorised to deliver the same to the BPSB s Solicitors as Stakeholder upon the receipt of the Letter of Undertaking by the BPSB s Financier issued in favour of the Shares Vendor or the Shares Vendor s Financier. Due Diligence (i) BPSB will carry out the exercise of due diligence in relation to the BPSB s acquisition of the Share Sale ( the Due Diligence Process ) and the Shares Vendor and SROPP will afford BPSB, its agents or representatives all reasonable facilities and assistance in carrying out such exercise to be completed within sixty (60) days from date hereof provided always that all documents, facilities and assistance is provided by the Shares Vendor to BPSB in a timely manner. The costs and expenses of the Due Diligence Process shall be borne solely by BPSB. (ii) In the event BPSB discovers any adverse findings in the course of the Due Diligence Process, BPSB shall notify NPC and SROPP in writing and discuss such adverse findings with NPC and SROPP with a view to reaching a mutually acceptable solution to the issues identified. If the parties are unable to reach such mutually acceptable solution on or before the expiry of fourteen (14) days from the date of notification by BPSB to NPC and SROPP of the adverse findings, either party may terminate the Shares Sale SPA provided that such adverse findings affect or disabled the disbursements of BPSB s Loan as evidenced by written notification or confirmation of BPSB s Financier and thereafter neither party shall have any claims whatsoever against each other. (iii) For the avoidance of doubt, the successful completion of the Due Diligence Process and the results thereof shall be satisfactory to BPSB s Financier. In the event BPSB s Financier fails to disburse BPSB s loan in settlement of the Balance Share Sale Consideration arising from adverse finding in the Due Diligence as evidenced by written notification or statement by BPSB s Financier, BPSB may elect to terminate the Share Sale SPA by seven (7) days written notice and thereupon the Share Sale SPA shall cease to have any effect and against the refund of the Deposit Sum free of interest within fourteen (14) days from the date of notification of the said termination subject however, in the event that the Shares Sale had already been transferred to BPSB, BPSB shall cause the Staked Documents and the Shares Sale to be transferred to NPC at the costs and expense of NPC. 6.2 Completion (a) Subject to BPSB and BPSB s Financier being satisfied, in its absolute discretion, with the results of the Due Diligence enquiry on SROPP carried out on its behalf, the Parties shall complete the sale and purchase of the Share Sale and the said Land on the Completion Date

7 6. SALIENT TERMS AND CONDITIONS OF THE SHARE SALE SPA (Continued) 6.2 Completion (Continued) (b) In the event that BPSB shall pay and settle the Balance Sum by cash, the following will occur:- (i) on the Completion Date, subject to the Shares Vendor performing all its obligations under the Share Sale SPA, BPSB shall pay the Balance Sum to the Shares Vendor s Stakeholders by way of bank draft subject to Clause 6.2(b)(ii) and 6(c) hereof after deducting the redemption sum and all outstanding to the Shares Vendor s Bank in satisfaction of the said Bank Liabilities and Taxation levied against SROPP or the Shares Vendor; (ii) BPSB s Solicitor shall deliver the Staked Documents to the company secretary of the SROPP to effect the transfers and appointments encompassed in the said documents; (iii) the Shares Vendor s Solicitors and/or BPSB s Solicitors shall procure the satisfaction of charge duly executed by the Shares Vendor s Bank and/or the release of debenture and/or any other documentary proof that the encumbrances have been settled and/or released; (iv) that the Shares Vendor shall close all bank accounts of SROPP; (v) The Shares Vendor s Solicitors shall only release the Balance Sum after deduction of the said Bank Liabilities to the Shares Vendor upon the successful registration of the transfer of the Share Sale in the name of BPSB (or its nominees) and the appointment of the Nominated Directors, Company Secretary and or other parties. (c) (d) The Shares Vendor further undertakes and covenants with BPSB to sign execute and do such further deeds documents acts and things as may be necessary to vest the ownership of the Share Sale in SROPP to BPSB and/or its nominee(s). Management and possession of the Palm Oil Mill shall be delivered to BPSB upon full settlement of the Share Sale Consideration. 6.3 Remedies of the Parties upon Default (a) In the event BPSB shall commit a breach of any of the terms of this Share Sale SPA including failure to pay any monies under this Share Sale SPA not attributable to the adverse finding of Due Diligence affecting the disbursement of BPSB s loan by BPSB s Financier and/or the Shares Vendor or BPSB fail, refuse or neglect to complete this Share Sale SPA (hereinafter referred to as the Cross Default ), the Shares Vendor shall be entitled to give notice to BPSB to remedy such breach within fourteen (14) days from the date of such notice and if BPSB shall fail to remedy or cause such breach to be remedied within such stipulated period, the Shares Vendor shall be entitled to terminate this Share Sale SPA and BPSB s Stakeholder shall release the Staked Documents to the Shares Vendor and the Shares Vendor shall be entitled to forfeit the Share Sale Deposit Sum absolutely as pre-agreed liquidated damages and refund to BPSB other money(s) in excess of the Share Sale Deposit Sum (if any) paid by it pursuant to any provisions of this Share Sale SPA free of interest with reservation to claim for all monies expended by the Shares Vendor for solicitors fees and cost on a solicitor and client basis in connection with the sale and purchase herein and enforcement of the Share Sale SPA.

8 6. SALIENT TERMS AND CONDITIONS OF THE SHARE SALE SPA (Continued) 6.3 Remedies of the Parties upon Default (Continued) (b) (c) In the event that the Shares Vendor and or SROPP shall commit any breach of this Share Sale SPA and or fails to pay the differential sum between the Balance Sum and the said bank liabilities within fourteen (14) days from the date of request by BPSB or its solicitors and or commit a Cross Default and/or that any of the representations, warranties or covenants or undertakings of the Shares Vendor herein contained shall be false, incorrect or misleading in any material respect or the Shares Vendor and/or SROPP shall have bankruptcy or winding up proceedings initiated against them and upon the happening of any of such event(s), BPSB shall be entitled to give notice to the Shares Vendor and/or SROPP to remedy such breach within fourteen (14) days from the date of such notice and if the Shares Vendor and or SROPP shall fail to remedy or cause such breach to be remedied within such stipulated period, BPSB shall be entitled to terminate this Share Sale SPA and BPSB shall be entitled to claim against the Shares Vendor and/or SROPP for damages and any costs and expenses reasonably incurred by BPSB in connection with this Share Sale SPA (including but not limited to all monies expended by BPSB towards compliance with Clause 6.1(g)(i) and solicitors fees and cost on a solicitor and client basis in connection with the purchase herein and enforcement of the Share Sale SPA) and BPSB s Solicitors as their stakeholder shall not release the Staked Documents to the Shares Vendor and/or SROPP until full settlement by the Shares Vendor and/or SROPP of all claims by BPSB ; Without prejudice to clause 6.3(b) hereinabove and in the event that the Shares Vendor and or SROPP shall fail/refuse/neglect to complete this Share Sale SPA and or commit a Cross Default (as defined hereinabove), BPSB shall be entitled to claim for : (i) specific performance of this Share Sale SPA; and (ii) any and all other expenses, damage and loss incurred by BPSB (including but not limited to the Solicitors fees and costs on a Solicitor and client basis in connection with the purchase herein or in respect of the said action for specific performance) and BPSB s stakeholder shall not release the Staked Documents to the Shares Vendor and/or SROPP if BPSB gives written notice of its intention to seek specific performance of this Share Sale SPA. 7. SALIENT TERMS AND CONDITIONS OF THE LAND SPA 7.1 Mode of Satisfaction of the Land Disposal Consideration and Completion Period The Land Disposal Consideration shall be payable by BPSB in the following manner: (a) the sum of RM1,200, (Ringgit Malaysia One Million Two Hundred Thousand) only ( the Land Deposit ) shall be paid by BPSB to BPSB s Solicitors upon execution of the Land SPA, which sum shall be deemed part payment of the Land Disposal Consideration upon completion of the Land SPA. Upon the receipt of the Deposit, BPSB s Solicitors are hereby expressly authorized by BPSB to forward the Deposit to ATSB s Solicitors to be held as Stakeholder for release to ATSB after deducting the Real Property Gains Tax retention sum;

9 7. SALIENT TERMS AND CONDITIONS OF THE LAND SPA (Continued) 7.1 Mode of Satisfaction of the Land Disposal Consideration and Completion Period (Continued) The Land Disposal Consideration shall be payable by BPSB in the following manner: (Continued) (b) the balance of the Land Disposal Consideration amounting to the sum of RM10,800, (Ringgit Malaysia Ten Million Eight Hundred Thousand) only ( the Balance of Land Disposal Consideration ) shall be paid by BPSB to ATSB s Solicitors as stakeholder within four (4) months from the date of the Land SPA ("the Land Completion Date"). In the event the whole or part of the Balance of Land Disposal Consideration were to be settled by way of a loan or facility from a bank/financier, the parties have hereby agreed that BPSB shall cause the BPSB s Banker/Financier to issue a written letter of undertaking to pay the Balance of Land Disposal Consideration in favour of ATSB within the Land Completion Date upon the successful registration of transfer of the said Land in favour of BPSB evidenced by issuance of memorial number by the Central Land Office provided always that BPSB s Solicitors/Banker/Financier shall have lodged the Memorandum of Transfer with the Central Land Office within five (5) working days from their receipt of the original issue copy of titles to the said Lands from the Chargee; (c) In the event that BPSB fails to settle the Balance of Land Disposal Consideration in the manner stated under Clause 7.1(b) above within the Land Completion Date, ATSB hereby agrees to grant BPSB a grace period of one (1) month ( Land Extended Completion Date ) provided always an interest at the rate of 8% per annum shall be made payable on the Balance of Land Disposal Consideration; (d) ATSB has agreed to bear and hereby authorizes ATSB s Solicitors to deduct from the Balance of Land Disposal Consideration or to retain a sum sufficient to pay and settle directly to the relevant local authorities payments of quit rent, fees, charges, assessment, if any, to render the said Lands free from encumbrances for transfer and delivery of vacant possession; (e) If and upon BPSB obtaining the Loan or the sum secured by undertaking issued by BPSB s Bank (hereinafter referred as the Facility Sum ), the differential sum between Balance of Land Disposal Consideration and the Facility Sum, if any ( the Differential Sum ), shall be paid by BPSB to ATSB s Solicitors as Stakeholder within the Completion Date, in which ATSB s Solicitors is only authorised to release the said Differential Sum to ATSB upon successful transfer of the said Land from ATSB in favour of BPSB evidenced by the issuance of the Memorial Number by the Central Land Office; (f) The Balance of the Facility Sum shall be released to ATSB ( Balance of Loan ) upon successful transfer of the said Land from ATSB in favour of BPSB evidenced by issuance of the Memorial Number by the Central Land Office, subject to payments of other fees, charges, if any, to render the said Lands free from encumbrances for transfer and delivery of vacant possession.

10 7. SALIENT TERMS AND CONDITIONS OF THE LAND SPA (Continued) 7.2 Delivery of Vacant Possession (a) Subject to the completion of the Related Sale and Purchase Agreement, the completion of the sale and purchase of the said Land shall take place on the date of successful transfer of the said Land to BPSB as evidenced by issuance of memorial number by the Central Land Office (hereinafter referred to as the Land Completion Date ) wherein the full Land Disposal Consideration together with interest (if any) shall have been paid by BPSB to ATSB Solicitors in accordance with Clause 7.1 hereof. (b) Subject to Clause 7.1, ATSB shall deliver vacant possession of the said Land to BPSB within five (5) working days from the date of the release of Balance of the Land Disposal Consideration and all moneys payable by BPSB to ATSB in accordance with the terms of the Land SPA. 7.3 Remedies of the Parties upon Default Default under the Related Sale and Purchase Agreement the Share Sale SPA (a) The parties herein agree that the said Land is to be sold En-bloc together with the sale of all the Issued shares in SROPP by NPC to BPSB under the Related Sale and Purchase Agreement. The parties hereto agree that in the event if the Related Sale and Purchase Agreement is terminated due to BPSB s fault or in the event of any default in the payment of any part of the Share Sale Disposal Consideration of the Related Sale and Purchase Agreement after the expiry of the Extended Completion Date therein, the Land SPA shall also be deemed terminated notwithstanding no-default of either party in the Land SPA. Upon such termination of the Land SPA, ATSB shall be at liberty to resell the said Land to any party at any price and in such manner as ATSB shall deem appropriate provided that the amount equivalent to the Land Deposit paid herein together with agreed interest paid (if any) shall be forfeited absolutely in favour of the said Land Vendor as agreed liquidated damages. (b) Upon termination of the Land SPA arising from Clause 7.3.1(a) above, if the transfer of the said Land herein had been registered in favour of BPSB, BPSB undertakes and shall cause the said Land to be transferred back to ATSB forthwith by executing the retransfer of the Memorandum of Transfer in favour of ATSB together with delivery of the Original Title Deed and Transfer Documents intact and thereafter neither party shall have any claim against the other. For the purpose, BPSB hereby agrees to bear all costs and expenses to be incurred for the transfer back (including stamping, registration fees and other outgoings and costs to be as assessed) of the said Land in favour of ATSB, free from encumbrances.

11 7. SALIENT TERMS AND CONDITIONS OF THE LAND SPA (Continued) 7.3 Remedies of the Parties upon Default (Continued) Default by BPSB In the event of any default in the payment of any part of Land Disposal Consideration after the expiry of the Land Extended Completion Date, ATSB shall be entitled to terminate the Land SPA forthwith. Upon such termination of the Land SPA, ATSB shall be at liberty to resell the said Land to any party at any price and in such manner as ATSB shall deem appropriate provided that the amount equivalent to the Land Deposit paid herein together with agreed interest paid (if any) shall be forfeited absolutely in favour of ATSB as agreed liquidated damages and ATSB or ATSB s Solicitors shall refund to BPSB without interest the Differential Sum and/or all other monies, if any, paid by BPSB to ATSB or ATSB s Solicitors pursuant to the terms of the Land SPA Default by ATSB In the event that ATSB fails to comply with any of the terms of the Land SPA, it is hereby agreed between the parties hereto that BPSB shall be entitled to take such action as may be available to BPSB at law to enforce specific performance of the Land SPA against ATSB or BPSB may terminate the Land SPA by 14 days written notice to ATSB, in which event ATSB and/or ATSB s Solicitors shall forthwith refund the Land Deposit and other moneys paid by BPSB under the terms of the Land SPA and further pays BPSB an additional sum equivalent to the amount of the Land Deposit paid herein being agreed liquidated damages. BPSB s Solicitors shall be entitled to continuing custody and possession of the Transfer Documents (if applicable) and all other relevant documents until the full repayment by ATSB to BPSB of all moneys being agreed liquidated damages. 8. ESTIMATED TIME FOR COMPLETION The Proposed Disposals are expected to be completed within the first quarter of year RATIONALE FOR THE PROPOSED DISPOSALS In view of the past performance of the Group s mills in Malaysia, Sungai Ruku Mill is the least performing as 95% of the mill s FFB throughput depends on external FFB suppliers. In addition, the said Land only contributed less than 1% of the total crops for the Group which has insignificant impact to the Group s performance. Post completion of the Proposed Disposals, NPC still owns approximately 11,714 hectares of plantation lands in Sabah, approximately 45,364 hectares in Indonesia and two palm oil mills. The Proposed Disposals will enable the NPC to accelerate its planting program to develop its remaining unplanted plantation lands in Indonesia. Upon maturity, the Board expects the plantation lands to contribute significantly towards the Group s financial performance. In view of the above, the Proposed Disposals will be able to improve the cash flow position of the Group.

12 10. RISK FACTORS Save for the general risks such as non-completion of both the Share Sale SPA and the Land SPA, the Board is not aware of any anticipated risk arising from the Proposed Disposals. 11. FINANCIAL INFORMATION 11.1 Original Cost and date of investment The original cost and date of investment of the Company in SROPP are as follows: Date No. of SROPP Shares Cost of Investment (RM) 31 May ,000, ,397, The original cost and date of investment of the said Land is as follows: Date Description Amount (RM) 02 January 2004 Leasehold land 404, The audited financial information for the past three (3) years is as follow: 2013 (RM 000) FYE 31 December 2014 (RM 000) 2015 (RM 000) SROPP Revenue 187, , ,446 Profit/(Loss) before tax ( PBT / (LBT) ) 4, (1,219) Profit/(Loss) after tax ( PAT / (LAT) ) 3, (954) Net assets 29,639 26,871 25,917 Total borrowings 6,568 10,604 12,753 ATSB Revenue 4,056 4,296 4,016 PBT 1,875 1,875 1,437 PAT 1,397 1,397 1,063 Net assets 19,712 21,109 22, Net Book Value of the said Land based on the latest audited financial statements ( ) of ATSB Description Amount (RM) Leasehold land 353, Plantation development expenditures and other capital 699, expenditures 1,052,425000

13 11. FINANCIAL INFORMATION (Continued) 11.4 Production The production of SROPP for the past three (3) years from 2013 to 2015 is set out below: FYE 31 December Production of CPO (mt) 64,463 77,027 56,325 Production of PK (mt) 16,519 19,736 13, Expected Gain on the Disposals Description Share Sale of SROPP (RM) Disposal of said Land (RM) Grand Total (RM) Sales consideration 35,500,000 12,000,000 47,500,000 Less: Total Net Assets of SROPP as at ,916,731-25,916,731 Total Net Book Value of the said Land as at ,052,425 1,052,425 Expected Gain 9,583,269 10,947,575 20,530, EFFECTS OF THE PROPOSED DISPOSALS Based on the audited consolidated financial statements of NPC as at 31 December 2015, the proforma effects of the Proposed Disposals are as follows: 12.1 Share capital and substantial shareholders shareholding The Proposed Disposals shall be satisfied entirely in cash and therefore will not have any effect on the share capital and substantial shareholders shareholding of the Company Earnings per share (EPS) The Proposed Disposals are expected to have material effect on the consolidated earnings per share of NPC Group for the financial year ending The Proposed Disposals are expected to generate an estimated one off gain of approximately RM20 million for the NPC Group or approximately RM0.17 per NPC share, before taking into consideration the estimated expenses in respect of the Proposed Disposals Net Assets per share After the Proposed Disposals, the Net Assets Per Share of NPC Group will increase from RM2.56 to RM2.73.

14 12. EFFECTS OF THE PROPOSED DISPOSALS (Continued) 12.4 Gearing Ratio After the Proposed Disposals, the gearing ratio will drop from 1.27 to UTILISATION OF PROCEEDS The total gross proceeds of RM47,500, to be received from the Proposed Disposals are intended to be utilized in the following manner: Estimated timeframe for full utilization RM 000 Repayment of Overdraft/Revolving Within 1 year 24,500 Credits/Bankers Acceptance Future working capital Within 1 year 23,000 Total gross proceeds 47, APPROVALS REQUIRED The Proposed Disposals are not subject to the approval of the shareholders of NPC and any relevant government authorities. The Proposed Disposals is not conditional upon any other corporate proposals and/or arrangement undertaken or to be undertaken by the Company. 15. PERCENTAGE RATIO The highest percentage ratio applicable to the Proposed Disposals pursuant to paragraph 10.02(g) of the Listing Requirements of Bursa Malaysia Securities Berhad for Main Market is 15.50%. 16. DIRECTORS AND SUBSTANTIAL SHAREHOLDERS INTERESTS None of the Directors and/or Substantial Shareholders of NPC and persons connected with them has any interest, direct or indirect, in the Proposed Disposals. 17. DIRECTORS STATEMENT The Board of Directors, having considered all aspects of the Proposed Disposals, including but not limited to the basis of arriving at the Disposal Consideration, rationale for the Proposed Disposals and the financial effects of the Proposed Disposals, is of the opinion that the Proposed Disposals are in the best interest of the Company and is not detrimental to the interests of the shareholders of NPC Group. 18. DOCUMENTS FOR INSPECTION The Sale and Purchase Agreements in relation to the Proposed Disposals will be available for inspection at the registered office of NPC during normal office hours on any working day for a period of three months from the date of this announcement. This announcement is dated 29 th September 2016.