: P. : Not Applicable. (vi) Status : Resident controlled company Non-bumiputera controlled company

Transcription

1 BACKGROUND INFORMATION (a) Issuer (i) Name : Nu Sentral Sdn Bhd ( NSSB or the Issuer ) Address : Level 21, 1 Sentral Jalan Travers Kuala Lumpur Sentral Kuala Lumpur (iii) (iv) (v) Business Registration No. Date/Place of Incorporation Date of Listing (in case of a public listed company) : P : 22 November 2006 / Malaysia : Not Applicable (vi) Status : Resident controlled company Non-bumiputera controlled company (vii) (viii) (ix) Principal Activities Board of Directors (as at 28 February 2011) Structure of shareholdings and names of shareholders (as at 28 February 2011) : The company s intended principal activity is operating a retail mall. : 1. Datuk Mohamed Razeek bin Md Hussain Maricar 2. Datuk Kamalul Arifin bin Othman 3. Mahmud Fauzi bin Muda 4. Wong Dor Loke 5. Chong Chin Ann 6. Wong Tze Meng (alternate Director to Chong Chin Ann) : The shareholders and shareholding structure of the Issuer are as follows: Shareholder(s) Malaysian Resources Corporation Berhad ( MRCB ) Pelaburan Hartanah Berhad ( PHB ) Percentage owned (%) 51% 49% Page 1

2 (x) Authorised and paid-up capital (as at 28 February 2011) : Authorised capital: RM25,000,000 divided into 20,000,000 ordinary shares of RM1.00 each and 500,000,000 redeemable preference shares of RM0.01 each. Issued and paid-up capital: RM21,682,500 divided into 20,000,000 ordinary shares of RM1.00 each and 168,250,000 redeemable preference shares of RM0.01 each issued at a premium of RM0.99 per share. PRINCIPAL TERMS AND CONDITIONS (a) Names of parties involved in the proposed transaction (where applicable) (i) Principal Adviser(s)/ Lead Arranger(s) : RHB Investment Bank Berhad ( RHB Investment Bank ) Arranger(s) : Not Applicable (iii) Valuers : Messrs. Khong & Jaafar Sdn Bhd (iv) Solicitors : Messrs. Zaid Ibrahim & Co. (v) Financial Adviser : Not Applicable (vi) Technical Adviser : Not Applicable (vii) Guarantor : Not Applicable (viii) Trustee : Malaysian Trustees Berhad (ix) Facility Agent : RHB Islamic Bank Berhad ( RHB Islamic Bank ) (x) (xi) Primary subscriber(s) and amount subscribed (where applicable) Underwriter(s) and amount underwritten : Not Applicable : Not Applicable Page 2

3 (xii) Shariah Adviser : RHB Islamic Bank (backed by the RHB Islamic Shariah Committee) (xiii) Central Depository : Bank Negara Malaysia ( BNM ) (xiv) Paying Agent : BNM (xv) (xvi) Reporting Accountant Others (please specify) : Not Applicable : Security Agent RHB Islamic Bank Placees To be finalised prior to first issuance (b) Islamic Principal Used : The Shariah principle of Murabahah utilising commodities ( Commodity Murabahah ). (c) Facility Description : Islamic Medium Term Note Programme of RM600.0 million (the IMTN Programme ) for the issuance of Islamic Medium Term Notes ( IMTNs ). The IMTNs will be issued based on the Shariah principle of Murabahah based on Commodity Murabahah structure in the following form: Commodity Murabahah The Issuer will be appointed as agent/wakeel ( Wakeel ) for the investors (the Murabahah Investors ) to buy Shariah-compliant commodities* (the Commodities ). The Wakeel will then appoint the Facility Agent (as its sub-purchase agent) to purchase the Commodities. The Issuer will issue a purchase order (the Purchase Order ) to the Wakeel (who is acting on behalf of the Murabahah Investors) and the Facility Agent. In the Purchase Order, the Issuer will irrevocably undertake to purchase the Commodities from the Murabahah Investors at a price equivalent to the Purchase Price and a mark-up (profit) payable on a deferred payment basis (the Deferred Sale Price ). The Facility Agent will purchase the Commodities from commodity vendor(s) in the Bursa Suq Al-Sila commodity Page 3

4 market (through a Commodity Trading Participant ( CTP )) at a purchase price (the Purchase Price ) on a spot basis, which shall be equivalent to the IMTN proceeds. Subsequently, the Issuer shall issue the IMTNs to the Murabahah Investors whereupon the IMTNs shall evidence the Murabahah Investors ownership of the Commodities and all such rights thereto (including all rights against the Issuer under the Purchase Order). Proceeds received from the issuances of the IMTNs shall be used by the Facility Agent to pay the Purchase Price of the Commodities. Thereafter, the Facility Agent shall sell the Commodities to the Issuer at the Deferred Sale Price. Upon completion of such purchase, the Issuer shall sell the Commodities to Bursa Suq Al-Sila through CTP for a cash consideration equal to the Purchase Price on a spot basis. During the tenure of the IMTNs, the Issuer shall make periodic payments to the Trustee (acting for the Murabahah Investors) amounting to its obligation to pay the Deferred Sale Price to the Murabahah Investors. Each such payment shall pro tanto reduce the obligation of the Issuer on the Deferred Sale Price payable for the Commodities. On the date of maturity of the IMTNs, all amounts then outstanding on the Deferred Sale Price shall be paid by the Issuer to the Trustee whereupon the IMTNs shall be cancelled. For the structural diagram in relation to the issuance of the IMTNs, please refer to the Annexure. Note: * Shariah-compliant commodities would exclude ribawi items in the category of medium of exchange such as currency, gold and silver. Page 4

5 (d) Issue Size (RM) : Up to RM600.0 million in nominal value. The aggregate outstanding nominal value of the IMTNs issued under the IMTN Programme at any point in time shall not exceed RM600.0 million. (e) Issue Price (RM) : Issued at par at an issue price to be determined prior to each issuance. (f) Tenor of the Facility/Issue : Up to seven (7) years from the date of first issuance. Maturities of the IMTNs The IMTNs may be issued with maturities from one (1) year and up to seven (7) years, provided always that the final maturity of any of the IMTNs shall not exceed the tenor of the IMTN Programme. (g) (h) Profit Rate (%) (please specify) Profit payment frequency and basis : The profit rate will be determined prior to each issuance. : The profit payment shall be made semiannually in each year and such other period to be agreed upon between the Issuer and the Lead Arranger and shall be calculated on an actual/365 basis. (i) Yield to Maturity (%) : The yield to maturity will be determined prior to each issuance. (j) Security/Collateral (if any) : The IMTNs are secured by the following: (i) A third party first legal charge over the Lot G (as defined herein), ranking pari passu with noteholders under Promising Quality Sdn Bhd s ( PQSB ) Islamic Medium Term Note Programme of up to RM200.0 million. Upon completion of the construction of the Lot G Retail Mall (as defined herein) and office tower, the IMTNs will be secured by the third party first legal charge over the Lot G Retail Mall; A debenture creating a fixed and floating charge over all the assets of the Issuer, both present and future; (iii) A third party charge over all the shares in the Issuer; Page 5

6 (iv) An assignment of all relevant takaful/insurances for the Lot G Retail Mall; (v) A legal assignment of all agreements entered and/or to be entered into between the Issuer and the purchaser(s) and/or tenants relating to the Lot G Retail Mall, including but not limited to the following: (a) (b) the sale of rights to the lease of Lot G Retail Mall to the Employees Provident Fund ( EPF ) and such other purchasers to be determined; and the sub-letting of the Lot G Retail Mall. (k) Details on utilisation of proceeds (vi) A charge over the Designated Accounts (as defined herein); (vii) Assignment of all rights and benefits under the Agreement to Lease between the Issuer and PQSB; and (viii) Such other security arrangement may be advised by the solicitors. : The proceeds of the IMTNs issued under the IMTN Programme will be utilised for the following Shariah compliant purposes: (i) payments to PQSB as advance lease payment* for the lease and for preoperating expenses of a retail mall ( Lot G Retail Mall ) to be constructed on two parcels of land held under Geran 73357, Lot 384, Seksyen 72 (formerly Geran 46230, Lot 364, Seksyen 72) and Pajakan Negeri 22421, Lot 194, both in Bandar Kuala Lumpur District of Kuala Lumpur ( Lot G ) of Kuala Lumpur Sentral; and to fund the Minimum Balance (as defined herein) in the Finance Service Reserve Account ( FSRA ) (as defined herein) during the construction stage of the Lot G Retail Mall. Page 6

7 (l) Sinking Fund (if any) : Not Applicable Note: * including reimbursement to the shareholders of the Issuer for any advances made to Issuer which has been utilised for the advance lease payments for the Lot G Retail Mall prior to the issuance of the IMTNs. (m) Rating Credit rating assigned [Please specify if this is an indicative rating] : Not rated. The IMTNs are non-transferable and non-tradable and the potential placees do not require a rating. Name of rating agency : Not Applicable (n) Form and Denomination : Each tranche of the IMTNs shall be represented by a global certificate to be deposited with BNM and is exchangeable for definitive bearer form only in certain limited circumstances. The IMTNs shall be issued in denomination of RM100,000 each. (o) Mode of Issue : Private placement to selected investors at a yield to maturity to be mutually agreed upon prior to each issuance. The IMTNs shall be issued in accordance with (1) the Participation and Operation Rules for Payment and Securities Services issued by Malaysian Electronic Clearing Corporation Sdn Bhd ( MyClear ) ( MyClear Rules ) and (2) the Operational Procedures for Securities Services issued by MyClear ( MyClear Procedures ), as amended or substituted from time to time (collectively the MyClear Rules and Procedures ). (p) Selling Restriction : Selling Restrictions At Issuance: The IMTNs may not be offered or sold directly or indirectly, nor may any document or other material in connection therewith be distributed in or outside Malaysia, other than those falling within Section 4(6) of the Companies Act 1965 (as amended). Page 7

8 Selling Restrictions Thereafter: The IMTNs shall not be transferable and shall not be tradable in the secondary market. (q) Listing Status : The IMTNs will not be listed on Bursa Malaysia Securities Berhad or any other stock exchange. (r) Minimum Level of Subscription (RM or %) : The minimum level of subscription for each issue of IMTNs shall be 100% of the size of a particular issue. (s) Other regulatory approvals required in relation to the issue, offer or invitation and whether or not obtained (please specify) : Not Applicable (t) Identified Assets : Shariah-compliant commodities (excluding ribawi items in the category of medium of exchange such as currency, gold and silver). The assets shall be endorsed by the Shariah Adviser. (u) Purchase and Selling Price/Rental (where applicable) : The purchase and selling price of the Commodities at which any sale and purchase transaction is undertaken will be determined from time to time prior to the issuance of the IMTNs. The purchase price of the Commodities shall fully comply with the Securities Commission s Shariah Advisory Council s pricing guidelines dated 31 December 2003 and 30 April 2004 respectively (and such guidelines as may be amended from time to time). (v) Conditions Precedent : To include but not limited to the following (in form and substance acceptable to the Lead Arranger/Facility Agent): (i) Completion and execution of the Transaction Documents (as defined herein) and, where applicable, stamped and presented for registration, save for the third party first legal charge over the leasehold land held under Pajakan Negeri 22421, Lot 194 in Bandar Kuala Lumpur District of Kuala Lumpur of Kuala Lumpur Sentral; Page 8

9 All relevant notices and acknowledgements (where applicable) shall have been made or received as the case may be; (iii) Certified true copy of the board resolution of the Issuer authorising: (a) (b) the issuance of the IMTNs; and the execution and creation of all security documents and all other documents relating to the IMTNs; (iv) Certified true copy of the board resolutions of MRCB, PHB and PQSB (the Security Parties ) authorising the execution of the relevant security documents; (v) (vi) The Issuer and the Security Parties shall have furnished certified true copies of its Forms 24, 44 & 49, Memorandum & Articles of Association and a list of its authorised signatories and their specimen signatures; Satisfactory company searches on the Issuer and the Security Parties; (vii) A search confirming the land on which Lot G Retail Mall is constructed is free from encumbrances; (viii) Satisfactory reports of the winding up search of the Issuer and the Security Parties; (ix) The Shariah-compliant Proceeds Account (as defined herein), Operations Account (as defined herein) and FSRA shall have been opened with a commercial bank acceptable to the Lead Arranger/Facility Agent; (x) Approval of the Securities Commission and such other regulatory authorities for the IMTNs shall have been obtained; Page 9

10 (xi) All licences and permits required for construction and operation of the Lot G Retail Mall are in place save to the extent of specified licences and permits which can reasonably be obtained only at a later date (and which the Issuer has undertaken to use its reasonable endeavours to procure by specified dates); (xii) Relevant document/form acceptable to the Lead Arranger/Facility Agent to evidence that the paid-up capital of the Issuer (including preference shares) together with all shareholders advances shall amount to at least RM200.0 million; (xiii) Confirmation acceptable to the Lead Arranger/Facility Agent that the occupancy rate is not less than 20%; (xiv) Evidence of the confirmation from the Shariah Adviser that the issuance of the IMTNs and the Transaction Documents are in compliance with Shariah principles; (xv) A legal opinion from the solicitors of the Lead Arranger confirming that all the conditions precedent have been duly complied/fulfilled and the validity and enforceability of all financing and security documents; (xvi) A legal opinion from the solicitors satisfactory to the Lead Arranger/ Facility Agent confirming that all terms and conditions in respect of the Agreement to Lease between the Issuer and PQSB have been met; (xvii) The Issuer shall furnish a certified true copy of each of the development order and approved building plan; (xviii) Receipt of a satisfactory report from an independent consultant to review matters including but not limited to reasonableness of cost and schedule of construction; Page 10

11 (xix) Receipt of a feasibility study on the construction and operation of Lot G Retail Mall, in form and substance satisfactory to the Lead Arranger/ Facility Agent; (xx) Receipt of the latest valuation report confirming that the open market value for the Lot G Retail Mall shall not be less than RM950.5 million upon completion; (xxi) Receipt of evidence that EPF has been given the first right of refusal to purchase the rights of the lease of Lot G Retail Mall at the end of the tenure of the IMTN Programme; (xxii) Evidence that all relevant fees due and payable by the Issuer in connection with the IMTN Programme have been paid in full or will be paid in a manner agreed by the transaction parties; and (xxiii) Such other conditions precedent as may be advised by the solicitors. (w) Representations and Warranties : To include but not limited to the following: (i) The Issuer is a company duly established and existing under the laws of Malaysia and it has the power and authority to enter into the business in which it is or proposes to be engaged; The Issuer has the power to enter into, exercise its rights and perform its obligations under the Transaction Documents; (iii) The Issuer s entry into, exercise of its rights under and performance of the Transaction Documents do not and will not violate any existing law or agreements to which it is a party; (iv) The Transaction Documents creates valid and binding obligations which are enforceable on and against the Issuer; Page 11

12 (v) All necessary actions, authorisations and consents required under the Transaction Documents have been taken, fulfilled and obtained and remain in full force and effect; (vi) Save as disclosed by the Issuer, no event has occurred which, if the IMTNs had already been issued, would constitute an Event of Default (as defined herein) under the IMTNs; (vii) The audited accounts of the Issuer are prepared in accordance with generally accepted accounting principles and standards and they fairly represent its financial position; (viii) No litigation or arbitration is current or, to the Issuer s knowledge, is threatened, which if adversely determined would have a material adverse effect on the ability of the Issuer to comply with the Transaction Documents; (ix) The financial statements and other information supplied are true and accurate in all material aspects and not misleading except that, when the warranted information is a forecast, the warranty will be to the effect that the forecast has been made on the basis of assumptions which were reasonable at the time when they were made and after due enquiry; and (x) Such other representations and warranties as may be advised by the solicitors to the Lead Arranger/ Facility Agent. (x) Events of Default : The Events of Default shall include, but shall not be limited to, the following: (i) The Issuer and/or the Security Parties are unable to pay any amount due under any of the Transaction Documents on the due date or, if so payable, on demand; If any step or action is taken for the winding-up, dissolution or liquidation of the Issuer and/or the Security Parties Page 12

13 (including, without limitation, the presentation of a petition for the windingup of the Issuer and/or the Security Parties where no action is taken in good faith to set aside such petition within thirty (30) days from the date of service of such winding-up petition or the making of any order or the passing of any resolution for the winding-up, dissolution or liquidation of the Issuer and/or its subsidiaries); (iii) If the Issuer and/or the Security Parties enters into a scheme of arrangement under section 176 of the Companies Act 1965 or such a scheme has been instituted against the Issuer and/or the Security Parties (other than for the purpose of a scheme of reconstruction, amalgamation, consolidation or merger, unless during or following such reconstruction, amalgamation, consolidation or merger the Issuer and/or the Security Parties becomes or is declared to be insolvent); (iv) If an encumbrancer takes possession of or a receiver, liquidator or similar officer is appointed over the whole or a substantial part of the assets or undertaking of the Issuer and/or the Security Parties; (v) If the Issuer and/or the Security Parties commits any breach of or omits to observe any of the obligations or undertakings expressed to be assumed by the Issuer and/or the Security Parties under the IMTNs (other than its payment obligations) and in respect of any such breach or omission which: (a) has a material adverse effect on the ability of the Issuer and/or the Security Parties to comply with the Transaction Documents to which they are a party or terms and conditions of the IMTNs; and (b) is capable of remedy, Page 13

14 the Trustee does not determine within 30 days after becoming aware of the failure, that the breach or omission has been remedied to its satisfaction; (vi) If the Issuer and/or the Security Parties makes any representation or warranty which is incorrect in any material respect when made or repeated; (vii) If any indebtedness of the Issuer and/or the Security Parties become (after the expiration of any applicable grace period) due and unpaid or is declared due before its stated maturity or where the security created for any other indebtedness becomes enforceable; (viii) If the Issuer and/or the Security Parties ceases to carry on the whole or substantially the whole of its business or where there is expiry or withdrawal, revocation, termination, withholding or modification of their subsidiaries licences, permits, consents, authorisations or approvals that impair or prejudice the Issuer and/or the Security Parties ability to comply with the Transaction Documents to which they are a party or the terms of the IMTNs; (ix) If it becomes unlawful or illegal for the Issuer and/or the Security Parties to perform or comply with their obligations under the Transaction Documents to which they are a party or any of the provisions of the said Transaction Documents becomes void, voidable or unenforceable; (x) If the Issuer and/or the Security Parties repudiates the Trust Deed or any agreement/security documents relating to the IMTNs or does any act or thing evidencing an intention to repudiate the Trust Deed or any agreement/security document relating to the IMTNs; Page 14

15 (xi) If any agency, authority or governmental body seizes, compulsorily acquires, expropriates or nationalises any assets, undertakings, rights or revenue of the Issuer and the Security Parties; and (xii) Such other events as may be advised by the solicitors. Upon the occurrence of an Event of Default, the Trustee may (at its discretion or if directed to do so by a special resolution of the IMTN holders) declare the IMTNs immediately due and payable, whereby: (i) no further issuance may be made under the IMTN Programme and the whole of the outstanding IMTNs together with all other sums payable shall become immediately due and payable; the Trustee shall have recourse to all remedies made available under the Transaction Documents and the Issuer will reimburse all parties for all losses and expenses incurred in consequence of the Event of Default; and/or (iii) the Trustee take proceedings as it may think fit to enforce immediate payment of all outstanding IMTNs issued. The certification from the Facility Agent to the amount of such losses and expenses shall, in the absence of manifest error, be conclusive. (y) Principal terms and conditions for warrants (where applicable) : Not Applicable (z) Other principal terms and conditions for the issue (i) Availability Status : Upon completion of all documentation and compliance with all conditions precedent therein to the satisfaction of the Lead Arranger. : The IMTNs represents the IMTN holders ownership of the Commodities and all such rights thereto (including all rights against the Issuer under the Purchase Order). Page 15

16 The IMTNs will constitute direct, secured, unconditional and unsubordinated obligations of the Issuer and shall at all times rank pari passu without priority or preference amongst themselves and at least pari passu with all its other present and future secured and unsubordinated obligations (except those obligations preferred by applicable laws). (iii) Redemption : Redemption upon Maturity: Unless previously redeemed, purchased or cancelled, all outstanding IMTNs will be redeemed at its face value on the respective maturity dates. Early Redemption: The Issuer may redeem the IMTNs (in whole or in part) prior to their maturity provided that the following conditions are fulfilled ( Early Redemption Date ): (i) (iii) notice period of at least thirty (30) days is given to the Facility Agent and the Trustee; redemption is made on a profit payment date; the Issuer shall be granted an ibra (rebate) in respect of an early redemption. The Ibra to be granted shall be calculated based on the following formula: Ibra (Rebate) = Unearned Profit Early Redemption Profit Note: 1. Unearned Profit = Profit due to the IMTN holders from the Early Redemption Date up to the maturity of the IMTNs. 2. Early Redemption Profit = An amount to be determined by the IMTN holders upon early redemption at its sole discretion. Page 16

17 (iv) Designated Accounts : The following Shariah-compliant accounts shall be opened and maintained with a financial institution acceptable to the Lead Arranger: (a) Finance Service Reserve Account ( FSRA ) The Issuer shall open and maintain a FSRA for the purpose of setting aside an amount equivalent to the next immediate profit payment ( Minimum Balance ) at all times. Funds in the FSRA shall be utilised for the payment of the profit portion under the IMTNs. Withdrawals from FSRA shall only be allowed if the Issuer has insufficient funds to make such payments from the Proceeds Account. Any withdrawal from the FSRA and/or shortfall in the Minimum Balance shall be replenished within a period of not exceeding one (1) month from the date of withdrawal. For the avoidance of doubt, any shortfall in the Minimum Balance within that one (1) month period shall not constitute an Event of Default. FSRA is to be operated solely by the Security Agent. (b) Proceeds Account The Issuer shall open and maintain a Proceeds Account for the purpose of depositing the following, including but not limited to:- (i) (iii) Proceeds of issuance of IMTNs; Income/fees, deposits (excluding any refundable deposits), rental, collections received by the Issuer from the operation of the Lot G Retail Mall; All other cash flow the Issuer is legally and beneficially entitled to; Page 17

18 (iv) Other receipts of a capital or revenue nature received by the Issuer; (v) Monies receivable from the Permitted Investments (as defined herein); (vi) (vii) Proceeds from the sale of the rights to the lease of Lot G Retail Mall; and Proceeds from takaful/insurance claims, if any. Funds in this account shall be utilised for the following purposes in the following order of priority:- (i) (iii) (iv) (v) (vi) Fees payable to the transaction parties; Profit payments under the IMTNs; Redemption of the IMTNs; Transfer to FSRA to maintain the Minimum Balance as defined above; Advance lease payment to PQSB for the lease of the Lot G Retail Mall and for pre-operating expenses of Lot G Retail Mall; and Transfer to Operations Account, on a monthly basis based on preagreed permitted operations expenditure. The Proceeds Account is to be operated solely by the Security Agent. (c) Operations Account The Issuer shall open and maintain an Operations Account for the purpose of depositing the funds from the Proceeds Account for permitted operations expenditure. Page 18

19 The Operations Account is to be operated solely by the Issuer. Upon the occurrence of an Event of Default, the Operations Account shall be operated by the Security Agent. (v) Permitted Investments (vi) Disbursement Conditions : The Issuer shall be permitted from time to time to utilise funds held in the Designated Accounts to make permitted investments, which shall be in compliance with Shariah principles, to be determined after consultation with the Lead Arranger. : Upon completion of all security documentation and compliance of the Conditions Precedent, the disbursement from the Proceeds Account shall be subject to the following conditions: (i) (iii) The receipt of satisfactory documentary evidence for the disbursement, for example the progress billings, in form and substance acceptable to the Security Agent; The Facility Agent shall have received at least five (5) business days prior written notice or such other period as agreed by the Facility Agent; and Such other conditions as may be advised by the solicitors. (vii) Positive Covenants : Positive covenants as may be deemed standard for a programme of this nature which shall include, but not be limited to the following: (i) The Issuer shall furnish such information as reasonably requested by the Trustee including but not limited to: (a) A list of the relevant approvals, permits and licenses required for the development of Lot G Retail Mall and a monthly status report of submission or approvals pertaining to the same. Page 19

20 (b) Interim quarterly financial results within ninety (90) days after the end of each quarter. (c) (d) (e) Audited accounts within one hundred and eighty (180) days after the end of the financial year. Monthly status report on the tenancy achieved during the operations period detailing the lettable space, lease tenure and the lease rental. Monthly status report on the progress of the construction of the Lot G Retail Mall. For avoidance of doubt, all status report shall be submitted to the Trustee on monthly basis or as and when required by the Trustee; (iii) (iv) All existing and future loans and advances extended to the Issuer by its shareholders, directors and/or related parties, shall be subordinated to the IMTNs; The Issuer shall maintain in full force and effect all relevant authorisations, consents, rights, licenses, approvals and permits (governmental and otherwise) and will promptly obtain any further authorisations, consents, rights, licenses, approvals and permits (governmental and otherwise) which is or may become necessary to enable it to own its assets and/or to operate its business; The Issuer will comply with all the provisions in the Transaction Documents and the terms and conditions of the IMTNs; Page 20

21 (v) (vi) (vii) (viii) (ix) (x) (xi) (xii) The Issuer will redeem in full all outstanding IMTNs in accordance with the terms and conditions of the IMTNs and pay and discharge all of its indebtedness and other obligations on or before their due dates; The Issuer will utilise the proceeds from the issuance of the IMTNs only for the intended purposes; The Issuer will provide the Trustee and any person appointed by it with access to its books and any information which may be required in order to discharge its duties and obligations; The Issuer will maintain a paying agent in Malaysia and procure it to inform the Trustee if it does not receive payment when due from the Issuer pursuant to the Trust Deed; The Issuer will exercise reasonable diligence to carry on and conduct its business and affairs in a proper and efficient manner in accordance with sound financial and commercial standards and practices, in particular to ensure that all necessary approvals or relevant licenses are obtained and preserved; The Issuer will prepare accounts in accordance with all relevant laws and accounting principles and practices generally accepted in Malaysia; The Issuer will defend itself against claims from third parties and diligently pursue claims against third parties (with de minimise exception); and Such other covenants as may be advised by the solicitors. Page 21

22 (viii) Negative Covenants : The Issuer shall not without the prior written consent from the Trustee and/or Facility Agent:- (i) (iii) (iv) (v) Carry out any business or activities other than business or activities related to the operation and leasing of the Lot G Retail Mall; Delete, vary or amend its Memorandum or Articles of Association in any manner which would be inconsistent with the provisions of the Trust Deed and terms and conditions of the IMTNs unless required for the purpose of a direct or indirect listing exercise; Enter into any transactions (whether directly and indirectly) with any interested person unless such transactions are on terms no less favourable to the Issuer than those transactions obtained with persons who are not interested persons; Dissolve its affairs or consolidate with or merge into any other entity; Incur, assume, guarantee or permit to exist any indebtedness, except for: (a) (b) the IMTNs; and borrowings, present and future, from the Security Parties and/or related parties, all of which are to be subordinated to the IMTNs; (vi) Pledge any of its assets to secure any loans and/or dispose any of its assets other than in the ordinary course of business; (vii) Extend any loans or advances to its shareholders, directors or related companies; (viii) Effect any change in the shareholding structure of the company; Page 22

23 (ix) (x) Repay or redeem any share capital or declare or pay any dividend; and Such other covenants as may be advised by the solicitors. (ix) Reporting Covenants : The Issuer shall give notice in writing to the Trustee immediately upon becoming aware of the happening of: (i) (iii) (iv) (v) (vi) Any Event of Default or potential Event of Default; Any right or remedy under the terms, provisions or covenants under the Trust Deed becoming immediately enforceable or any amount payable under the IMTNs becoming immediately payable; Any change in the withholding tax position or taxing jurisdiction of the Issuer; Any change in the utilisation of the proceeds arising from the issue of the IMTNs as compared to the intended purposes; Any substantial change in the nature of the Issuer s business; Any other matter or circumstance that would materially prejudice the Issuer or otherwise materially prejudice the interests of the IMTN holders or cause the Issuer to be unable to fulfil or comply with any of the provisions of the Trust Deed; or (vii) Such other covenants as may be advised by the solicitors. (x) Other conditions : (i) MRCB and PHB shall provide an irrevocable and unconditional letter of undertaking, in form and substance acceptable to the Lead Arranger/Facility Agent, to undertake the following during the tenure of the IMTN Programme: (a) No changes in the Issuer s shareholding structure; Page 23

24 (b) No corporate restructuring exercise in the Issuer; (c) No change in the principal business activities of the Issuer; (d) Completion of the Lot G Retail Mall; (e) Payment of all profit and redemption of IMTNs in accordance with the terms of the IMTNs; (f) Meet all costs over-runs and shortfall in working capital requirements and debt servicing including the replenishment of any shortfall in the FSRA during the tenure of the IMTNs. The financial obligations in the letter of undertaking shall be proportionate to MRCB and PHB s respective shareholding in the Issuer. (iii) The holders of IMTNs will be granted the first right of refusal on the refinancing of the IMTNs. EPF will be given the first right of refusal to purchase the rights of the lease of Lot G Retail Mall at the end of the tenure of the IMTN Programme. (xi) Transaction Documents The IMTN Programme shall be evidenced inter alia, by the following: (i) (iii) (iv) (v) Programme Agreement; Depository and Paying Agency Agreement; Trust Deed; Assignments; and Any other relevant documentation which may be advised by the solicitors and mutually agreed by the Issuer and the Lead Arranger. Page 24

25 (xii) Compensation for Late Payment ( Ta widh ) (xiii) Taxation : In the event of any overdue payments of any amounts due under the IMTNs, the Issuer shall pay to the Trustee for the benefit of the IMTN holders, compensation ( Ta widh ) on such overdue amounts at an amount and manner prescribed by the SC s Shariah Advisory Council from time to time in accordance with the Shariah principles. : All payments of face value of the IMTNs, profit, and other amounts payable to the IMTN holders shall be made without withholding or deduction for, or on account of, any present or future taxes, duties, assessments or governmental charges of whatever nature imposed or levied by or on behalf of any authority therein or thereof having power to tax, unless the withholding or deduction of such taxes, duties, assessments or governmental charges is required by law. The Issuer will pay any additional amount in respect of any deduction or withholding from the payment of principal or profit portion for or on account of any such taxes, duties, assessment or governmental charges in relation to the IMTNs. (xiv) Fees and Expenses (xv) Governing Law : All legal fees, stamp duties and reasonable expenses incurred in connection with the IMTNs, including professional due diligence fees and fees payable to the rating agency, if any, shall be for the account of the Issuer or be reimbursable by the Issuer. : The laws of Malaysia Page 25

26 Annexure (4) Purchase of Commodities on spot (4) Purchase Price Bursa Suq Al-Sila (via CTP) (7) Sale of Commodities on spot (7) Purchase Price Facility Agent (Sub-Purchase Agent) NSSB (Wakeel) (6) Sale of Commodities on Deferred Sale Price (2) Appoint Facility Agent to purchase Commodities (3) Purchase Order (5) Issue IMTNs NSSB (The Issuer/Wakeel) (1) Appoint NSSB as agent to buy Commodities (9) Advance lease payment for the lease of Lot G Retail Mall PQSB (8) Payment of Deferred Sale Price (5) IMTN Proceeds IMTN holders (Murabahah Investors) Trustee 1. The Issuer will be appointed as agent/wakeel ( Wakeel ) for the investors (the Murabahah Investors ) to buy Shariah-compliant commodities* (the Commodities ). 2. The Wakeel will then appoint the Facility Agent (as its sub-purchase agent) to purchase the Commodities. 3. The Issuer will issue a purchase order (the Purchase Order ) to the Wakeel (who is acting on behalf of the Murabahah Investors) and the Facility Agent. In the Purchase Order, the Issuer will irrevocably undertake to purchase the Commodities from the Murabahah Investors at a price equivalent to the Purchase Price and a mark-up (profit) payable on a deferred payment basis (the Deferred Sale Price ). 4. The Facility Agent will purchase the Commodities from commodity vendor(s) in the Bursa Suq Al-Sila commodity market (through a Commodity Trading Participant ( CTP )) at a purchase price (the Purchase Price ) on a spot basis, which shall be equivalent to the IMTN proceeds. Page 26

27 5. Subsequently, the Issuer shall issue the IMTNs to the Murabahah Investors whereupon the IMTNs shall evidence the Murabahah Investors ownership of the Commodities and all such rights thereto (including all rights against the Issuer under the Purchase Order). Proceeds received from the issuances of the IMTNs shall be used by the Facility Agent to pay the Purchase Price of the Commodities. 6. Thereafter, the Facility Agent shall sell the Commodities to the Issuer at the Deferred Sale Price. 7. Upon completion of such purchase, the Issuer shall sell the Commodities to Bursa Suq Al-Sila through CTP for a cash consideration equal to the Purchase Price on a spot basis. 8. During the tenure of the IMTNs, the Issuer shall make periodic payments to the Trustee (acting for the Murabahah Investors) amounting to its obligation to pay the Deferred Sale Price to the Murabahah Investors. Each such payment shall pro tanto reduce the obligation of the Issuer on the Deferred Sale Price payable for the Commodities. On the date of maturity of the IMTNs, all amounts then outstanding on the Deferred Sale Price shall be paid by the Issuer to the Trustee whereupon the IMTNs shall be cancelled. 9. The Purchase Price will be utilized by the Issuer for, amongst others, payments to PQSB as advance lease of Lot G Retail Mall. Note: * Shariah-compliant commodities would exclude ribawi items in the category of medium of exchange such as currency, gold and silver. Page 27