DAIBOCHI PLASTIC AND PACKAGING INDUSTRY BHD (Company No W) (Incorporated in Malaysia)

Transcription

1 THIS STATEMENT AND CIRCULAR ARE IMPORTANT AND REQUIRE YOUR IMMEDIATE ATTENTION If you are in any doubt about the course of action to be taken, you should consult your stockbroker, banker, solicitor, accountant or other professional adviser immediately. Bursa Malaysia Securities Berhad ( Bursa Securities ) has not perused this Statement and Circular prior to their issuance as they are exempt documents. Bursa Malaysia takes no responsibility for the contents of this Statement and Circular, makes no representation as to their 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 Statement and Circular. DAIBOCHI PLASTIC AND PACKAGING INDUSTRY BHD (Company No W) (Incorporated in Malaysia) PART A: STATEMENT TO SHAREHOLDERS IN RELATION TO THE PROPOSED RENEWAL OF SHARE BUYBACK AUTHORITY AND PART B: CIRCULAR TO SHAREHOLDERS IN RELATION TO THE PROPOSED AMENDMENTS TO ARTICLES OF ASSOCIATION OF THE COMPANY The Notice convening the Thirty Fifth Annual General Meeting to be held at Bunga Melati Room, Level 7 Renaissance Melaka Hotel, Jalan Bendahara, Melaka on Wednesday, 21 May 2008 at a.m. together with the Form of Proxy is set out in the Company s Annual Report 2007 while extract of resolutions on the Proposals are set out in Appendix III of this Statement/Circular. Please complete and return the Form of Proxy in accordance with the instructions thereon. Your completed Form of Proxy should reach the Registered Office of the Company not less than fortyeight (48) hours before the time set for holding the meeting or any adjournment thereof. The lodging of the Form of Proxy shall not preclude you from attending and voting in person at the meeting should you subsequently wish to do so. This Statement/Circular is dated 29 April 2008

2 DEFINITIONS AGM Board Bursa Securities Code Companies Act Daibochi Group Annual General Meeting The Board of Directors of Daibochi Bursa Malaysia Securities Berhad The Malaysian Code on TakeOvers & Mergers 1998, as amended from time to time and any enactment thereof The Malaysian Companies Act, 1965, as amended from time to time and any enactment thereof Daibochi and its subsidiary companies Daibochi or the Company Daibochi Plastic And Packaging Industry Bhd (12994 W) Directors EGM EPS Listing Requirements NA The directors for the time being of Daibochi, and shall have the same meaning as in Section 4 of the Companies Act Extraordinary General Meeting Earnings per share Bursa Malaysia Securities Listing Requirements Net assets attributable to ordinary equity holders of Daibochi Persons Connected This shall have the same meaning as in Paragraph 1.01 of the Listing Requirements Proposed Share Buy Back RM Shares Substantial Shareholders Proposed renewal of the existing authority granted to the Company to purchase up to ten percent (10%) of the issued and paidup share capital of the Company Ringgit Malaysia Ordinary shares of RM1.00 each in the capital of Daibochi The substantial shareholders for the time being of Daibochi, and shall have the same meaning given in Section 69D of the Companies Act Words importing the singular shall, where applicable, include the plural and vice versa, and words importing the masculine gender shall, where applicable, include the feminine and neuter genders. Words importing persons include corporations. Any reference to any enactment is a reference to that enactment as for the time being amended or reenacted. Any word defined under the Companies Act and used in this statement/circular shall have the meaning assigned to it under the Companies Act. Any reference to a time of day shall be a reference to Malaysian time. i

3 CONTENTS PART A: PROPOSED RENEWAL OF SHARE BUYBACK AUTHORITY Page 1. INTRODUCTION 1 2. RATIONALE FOR THE PROPOSED SHARE BUYBACK 1 3. SOURCE OF FUNDS 1 4. POTENTIAL ADVANTAGES AND DISADVANTAGES OF THE PROPOSED SHARE BUYBACK 2 5. FINANCIAL EFFECTS OF THE PROPOSED SHARE BUYBACK IMPLICATIONS RELATING TO THE CODE 3 7. PURCHASES IN THE LAST FINANCIAL YEAR 3 8. PUBLIC SHAREHOLDING SPREAD 4 9. INTERESTS OF DIRECTORS AND SUBSTANTIAL SHAREHOLDERS DIRECTORS RECOMMENDATIONS DIRECTORS RESPONSIBILITY STATEMENT 5 PART B: CIRCULAR TO SHAREHOLDERS IN RELATION TO PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION 1. INTRODUCTION 6 2. DETAILS OF THE PROPOSED AMENDMENTS 6 3. RATIONALE FOR THE PROPOSED AMENDMENTS 6 4. EFFECTS OF THE PROPOSED AMENDMENTS 6 5. APPROVALS REQUIRED 7 6. DIRECTORS AND MAJOR SHAREHOLDERS INTERESTS 7 7. DIRECTORS RECOMMENDATION 7 8. AGM 7 9. FURTHER INFORMATION 7 APPENDIX I PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF THE COMPANY 814 APPENDIX II FURTHER INFORMATION 15 APPENDIX III RESOLUTIONS IN RESPECT OF THE PROPOSED RENEWAL OF SHARE BUYBACK AUTHORITY AND PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF THE COMPANY 16 ii

4 PART A STATEMENT TO SHAREHOLDERS in relation to the PROPOSED RENEWAL OF SHARE BUYBACK AUTHORITY

5 DAIBOCHI PLASTIC AND PACKAGING INDUSTRY BHD (Company No W) (Incorporated in Malaysia) PROPOSED RENEWAL OF SHARE BUYBACK AUTHORITY ( PROPOSED SHARE BUY BACK ) 1. INTRODUCTION At the Extraordinary General Meeting ( EGM ) held on 23 May 2007, the shareholders of Daibochi gave authority for the Company to purchase up to 10% of the issued and paidup share capital of the Company for the time being quoted on Bursa Securities. The said authorisation shall, in accordance with the Listing Requirements of Bursa Securities, expire at the conclusion of the forthcoming 35 th AGM. Accordingly on 4 April 2008, an announcement was made to Bursa Securities that the Board proposed to seek shareholders authorization for the Proposed Share BuyBack at the forthcoming 35 th AGM. This Statement serves to provide you with the relevant information on the Proposed Share BuyBack, to set out your Board s recommendation thereon and to seek your approval for the ordinary resolution in respect of the Proposed Share BuyBack to be tabled at the forthcoming 35 th AGM. The Notice of AGM together with the Form of Proxy are enclosed in the Annual Report RATIONALE FOR PROPOSED SHARE BUYBACK The Proposed Share BuyBack Authority will enable Daibochi to utilize its financial resources not immediately required for use, to purchase its own shares. It may stabilise the supply and demand of Daibochi shares traded on Bursa Securities and thereby supports the fundamental value of the Shares, in particular to ensure, where possible, that the market share price is a fair reflection of the value of the Company. The purchased Shares may be cancelled or held as treasury shares. If held as treasury shares, they could be resold on Bursa Securities with the intention of realising a potential gain. In the event the treasury shares are distributed as share dividends, it would serve to reward the shareholders. 3. SOURCE OF FUNDS The Board proposes to allocate an amount of funds not exceeding the retained earnings and share premium of the Company for the purchase of its own Shares pursuant to the Proposed Share BuyBack. Based on the latest audited financial statement as at 31 December 2007, the retained earnings and share premium of the Company stood at RM28,900,268 and RM1,224,215 respectively. The funding for the purchase of its own Shares will be sourced wholly from internally generated funds of the Company and/or external borrowings, the portion of which to be utilized will depend on the actual number of Shares to be purchased, the price of Shares and the availability of funds at the time of the purchase(s). If borrowings are used for the Proposed Share BuyBack, the Company will experience a decline in its net cash flow to the extent of the interest costs associated with such borrowings but the Board does not foresee any difficulty in repayment of borrowings, if any, that is used for the Proposed Share BuyBack. 1

6 4. POTENTIAL ADVANTAGES AND DISADVANTAGES OF THE PROPOSED SHARE BUY BACK The Proposed Share BuyBack will enhance the earnings per share of the Company as the purchased shares are not taken into consideration in the computation of the EPS which in turn is expected to have a positive impact on the share price of the Daibochi shares. The Proposed Share BuyBack also allows the Company to take preventive measures against speculation particularly when its Shares are undervalued which would in turn stabilise the market price of Daibochi Shares and hence, enhance investors confidence. Other advantages of the Proposed Share BuyBack are outlined in Section 2 on the Rationale for the Proposed Share BuyBack. However, the Proposed Share BuyBack, if implemented will reduce the financial resources of the Daibochi Group and may result in the Daibochi Group foregoing future investment opportunities and/or any interest income that can be derived from deposit of funds in interest bearing instruments. It may also result in a lower amount of cash reserves available for dividends to be declared to shareholders as funds are utilized to purchase the Shares. Nevertheless, the Board will be mindful of the interests of the Company and the shareholders in implementing the Proposed Share BuyBack. 5. FINANCIAL EFFECTS OF THE PROPOSED SHARE BUYBACK Assuming that the Company purchases 7,590,180 Shares representing ten percent (10%) of its issued and paidup share capital as at 31 December 2007, the effects of the Proposed Share BuyBack on the share capital, earnings, net assets, dividends and working capital are set out as follows: (a) Share Capital The Proposed Share BuyBack will have no effect on the issued and paidup share capital of Daibochi if all of the Shares purchased are held as treasury shares but the rights attaching to the treasury shares as to voting, dividends and participation in the distribution or otherwise will be suspended. The Proposed Share BuyBack will reduce the issued and paidup share capital of the Company to RM68,311,621 as follows if all of the Shares purchased are subsequently cancelled: Issued and paidup share capital (RM) As at 31 December 2007 After Share BuyBack 75,901,801 68,311,621 (b) Earnings The effect of the Proposed Share BuyBack on the EPS of the Daibochi Group would depend on the effective funding cost to the Daibochi Group to finance the purchase of Daibochi Shares or any loss in interest income to the Company. Assuming the Purchased Shares are retained as treasury shares and resold, the effects on the EPS of the Daibochi Group will depend on the actual selling price, the number of treasury shares resold and the effective gain or interest savings arising from the exercise. If the Purchased Shares are cancelled, the Proposed Share BuyBack will increase the EPS of the Daibochi Group provided the income foregone and/or interest expense incurred on the Purchased Shares is less than the EPS before the Proposed Share BuyBack. 2

7 (c) Net Assets The effect of the Proposed Share BuyBack on the NA of the Daibochi Group will depend on the purchase price(s) of the Daibochi Shares and the effective funding cost to the Daibochi Group to finance the purchase of Daibochi Shares or any loss in interest income to the Company. The Proposed Share BuyBack would reduce the consolidated NA per share of the Daibochi Group when the purchase price per Daibochi Share exceeds the NA per share at the time of purchase. Conversely, the consolidated NA per share of the Daibochi Group will increase at the time of purchase if the purchase price per share is less than the consolidated NA per share. If the treasury shares are resold, the consolidated NA per share of the Daibochi Group would increase if the Company realises a gain from the resale, and vice versa. However the quantum of the increase in NA will depend on the selling prices and the number of shares resold. If the treasury shares are distributed as share dividends, the NA per share of the Daibochi Group would decrease by the cost of the treasury shares. (d) Dividends Assuming the Proposed Share BuyBack is implemented in full and the dividend quantum is maintained at historical levels, the Proposed Share BuyBack will have the effect of increasing the dividend rate of the Company as a result of the reduction in the issued and paidup share capital of the Company. (e) Working Capital The Proposed Share BuyBack will reduce the working capital of the Daibochi Group, the quantum of which will depend on the purchase price(s) of the Daibochi s Shares and the number of shares purchased. 6. IMPLICATIONS RELATING TO THE CODE In the event that the Proposed Share BuyBack results in any one of the substantial shareholder and/or persons acting in concert with him/her holding more than 33% of the voting shares of the Company, pursuant to the Code, the affected substantial shareholder and/or persons acting in concert with him/her will be obliged to make a mandatory offer for the remaining Shares not held by him/her. In the event that the Proposed Share BuyBack results in any one of the substantial shareholder and/or persons acting in concert with him/her who already holds more than 33% of the voting shares of the Company increasing by more than 2% in any six (6) months period, pursuant to the Code, the affected substantial shareholder and/or persons acting in concert with him/her will be obliged to make a mandatory offer for the remaining Shares not held by him/her. However, the affected substantial shareholder and/or persons acting in concert with him/her may apply for a waiver from the Securities Commission under Practice Note of the Code. In this respect, the Board will be mindful of the potential implications relating to the Code. 7. PURCHASES IN THE LAST FINANCIAL YEAR During the financial year ended 31 December 2007, the Company purchased 1,000 of its issued ordinary shares from the open market at RM0.70 per share. The total consideration paid for the repurchase including transaction costs was RM713. The shares repurchased are being held as treasury shares. 3

8 8. PUBLIC SHAREHOLDING SPREAD As at 31 March 2008, the public shareholding spread of the Company was 59.74%. Assuming that the Proposed Share BuyBack was carried out in full, the Shares so purchased are subsequently cancelled and that all the Shares so purchased are from the public shareholders of Daibochi, the public shareholding spread of the Company would be reduced to 55.27%. The Directors will ensure that the Company complies with the public shareholding spread requirement and will not buy back shares if the purchase would result in the public shareholding spread requirement not being met. 9. INTERESTS OF DIRECTORS AND SUBSTANTIAL SHAREHOLDERS Save for the proportionate increase in the percentage of shareholdings and/or voting rights in their capacity as shareholders as a consequence of the Proposed Share BuyBack, none of the Directors or Substantial Shareholders of the Company or Persons Connected with them has any interest, direct or indirect, in the Proposed Share BuyBack and resale of treasury shares, if any. Based on the Registers of Directors shareholdings and Substantial Shareholders shareholdings as at 31 March 2008 and assuming the Proposed Share BuyBack is implemented in full and that the Daibochi Shares purchased are from shareholders other than the existing Directors and substantial shareholders of the Company, the proforma effect of the Proposed Share BuyBack on the shareholdings of the existing Directors and substantial shareholders of the Company are set out below: Directors: P. James Edwin A/L Louis Pushparatnam Before the Proposed Share Buy Back After the Proposed Share Buy Back Direct Indirect Direct Indirect No. of Shares % No. of Shares % No. of Shares % No. of Shares % 6, , Lim Soo Koon 60, , Yong Jaw Teck 1,196, ,196, Datuk Wong Soon Lim 4,662, ,800* ,662, ,800* 0.27 Low Chan Tian 4,836, ,673,240** ,836, ,673,240** 5.38 Chee Ho Chun 122, * , * 0.00 Substantial shareholders: Low Chan Tian 4,836, ,673,240** ,836, ,673,240** 5.38 Datuk Wong Soon Lim 4,662, ,800* ,662, ,800* 0.27 Datin Teh Kim Hong 4,157, ,157, * deemed interest through spouse ** deemed interest through spouse and son 4

9 10. DIRECTORS RECOMMENDATIONS The Board, having considered all aspects of the Proposed Share BuyBack, is of the opinion that it is in the best interest of the Company. Our Board therefore recommends that shareholders vote in favour of the resolution pertaining to the Proposed Share BuyBack to be tabled at the forthcoming 35 th AGM. 11. DIRECTORS RESPONSIBILITY STATEMENT This Statement has been seen and approved by the Board and it collectively and individually accepts full responsibility for the accuracy of the information given in this Statement and confirm that after making all reasonable enquiries and to the best of their knowledge and belief, there is no other fact the omission of which would make any statement herein false or misleading. This Statement is dated 29 April

10 PART B CIRCULAR TO SHAREHOLDERS in relation to the PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF THE COMPANY

11 DAIBOCHI PLASTIC AND PACKAGING INDUSTRY BHD (Company No W) (Incorporated in Malaysia) Registered Office: Kompleks Daibochi Plastic Lot 3 & 7 Air Keroh Industrial Estate Phase IV Melaka Board of Directors: P.James Edwin A/L Louis Pushparatnam (Chairman/Independent NonExecutive Director) Lim Soo Koon (Managing Director) Yong Jaw Teck (Executive Director) Y. Bhg. Datuk Wong Soon Lim (Executive Director) Low Chan Tian (Executive Director) Hiew Chee Peng (Independent NonExecutive Director) Chee Ho Chun (Independent NonExecutive Director) 29 April 2008 TO: THE SHAREHOLDERS OF DAIBOCHI PLASTIC AND PACKAGING INDUSTRY BHD Dear Sir/Madam PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF THE COMPANY ( PROPOSED AMENDMENTS ) 1. INTRODUCTION The Board had on 4 April 2008 announced that the Company intended to seek Shareholders approval for the Proposed Amendments at the forthcoming 35 th AGM. This Circular serves to provide you with the relevant information on the Proposed Amendments, to set out your Board s recommendation thereon and to seek your approval for the special resolution in respect of the Proposed Amendments to be tabled at the forthcoming 35 th AGM. The Notice of AGM together with the Form of Proxy are enclosed in the Annual Report DETAILS OF THE PROPOSED AMENDMENTS The details of the Proposed Amendments are set out in Appendix I of this Circular. 3. RATIONALE FOR THE PROPOSED AMENDMENTS The Proposed Amendments are to bring the Company s Articles of Association in line with the Listing Requirements and to update the Articles of Association. 4. EFFECTS OF THE PROPOSED AMENDMENTS The Proposed Amendments will not have any effect on the share capital, Directors and Substantial Shareholders shareholdings, earnings, NA and dividend of the Company. 6

12 5. APPROVALS REQUIRED The Proposed Amendments are subject to Shareholders approval at the forthcoming 35 th AGM. 6. DIRECTORS AND SUBSTANTIAL SHAREHOLDERS INTERESTS None of the Directors or Substantial Shareholders of the Company or persons connected with them has any interest, direct or indirect, in the Proposed Amendments. 7. DIRECTORS RECOMMENDATION Your Directors, having considered the rationale for the Proposed Amendments, are of the opinion that the Proposed Amendments are in the best interest of the Company. Accordingly, they recommend that you vote in favour of the special resolution pertaining to the Proposed Amendments to be tabled at the forthcoming 35 th AGM. 8. AGM The Special Resolution in relation to the Proposed Amendments is incorporated in the Notice convening the 35 th AGM set out in the Annual Report. The AGM will be held at Bunga Melati Room, Level 7 Renaissance Melaka Hotel Jalan Bendahara, Melaka, on 21 May 2008 at a.m. for the purpose of considering and, if thought fit, passing the Special Resolution to give effect to the Proposed Amendments. If you are unable to attend and vote in person at the AGM and wish to appoint a proxy to attend and vote on your behalf, you should complete, sign and return the Form of Proxy in accordance with the instructions printed thereon as soon as possible and, in any event, so as to reach the registered office at Kompleks Daibochi Plastic, Lot 3 & 7 Air Keroh Industrial Estate, Phase IV, Melaka not later than a.m. on 19 May The completion and return of the Form of Proxy will not preclude you from attending and voting at the AGM in person should you subsequently wish to do so. 9. FURTHER INFORMATION Shareholders are requested to refer to the Appendix II for further information. Yours faithfully For and on behalf of the Board P. JAMES EDWIN A/L LOUIS PUSHPARATNAM Chairman and Independent NonExecutive Director 7

13 APPENDIX I DAIBOCHI PLASTIC AND PACKAGING INDUSTRY BHD (Company No W) DETAILS OF THE PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF THE COMPANY In particular, the existing Articles of Association of the Company ( existing Articles ) are amended by the alterations, modifications, deletion and/or additions, wherever necessary whereby the affected existing Articles are reproduced here with the Proposed Amendments to the Articles of Association of the Company, in bold, alongside it: Existing Articles 2.Definitions and interpretation The Stock Exchanges means The Stock Exchanges on which the shares or other securities of the Company are quoted. Market day means Any day between Mondays and Fridays which is not a market holiday of the Stock Exchange or Public holiday. Member means A registered shareholder of the Company (excluding the Malaysian Central Depository Nominees Sdn Bhd), including depositors whose names appear on the Record of Depositors. Central Depository means Malaysian Central Depository Sdn Bhd. Central Depositories Act means The Securities Industry (Central Depositories) Act Depositor means A holder of a Securities Account. Approved Market Place means A Stock Exchange which is specified to be an approved market place in the Securities Industry (Central Depositories) (Exemption) (No.2) Order Foreign Register means the register of holders maintained by the registrar of the Company in the jurisdiction of the Approved Market Place. Listing Requirements means The Listing Requirements of the Kuala Lumpur Stock Exchange including any amendments thereto that may be made from time to time. Proposed Amendments to Articles 2. Definitions and interpretation Deleted and replaced with: The Stock Exchange means Bursa Malaysia Securities Berhad (635998W) or such other name by which it shall be known from time to time. Market day means A day on which the stock market of the Stock Exchange is open for trading in securities. Member means Any person for the time being holding shares in the Company and whose name appears in the Register of Members (except Bursa Malaysia Depository Nominees Sdn Bhd), including depositors whose names appear on the Record of Depositors. Depository means Bursa Malaysia Depository Sdn Bhd ( W) or such other name by which it shall be known from time to time. Central Depositories Act no change Depositor means A holder of a Securities Account established by the Depository. Deleted Deleted Listing Requirements means The Listing Requirements of Bursa Malaysia Securities Berhad for the Main Board and any amendments thereto that may be made from time to time. 8

14 The term Central Depository and Kuala Lumpur Stock Exchange wherever it appears in this Articles of Association, shall be replaced with the term Depository and Bursa Malaysia Securities Berhad. Existing Articles 4 (b) No director shall participate in an issue of shares to employees unless shareholders in general meeting have approved of the specific allotment to be made to such director and unless he holds office in an executive capacity provided always that a director not holding office in an executive capacity may so participate in an issue of shares pursuant to a public offer or public issue; (c) The total nominal value of issued preference shares shall not exceed the total nominal value of the issued ordinary shares at any time; (d) The rights attaching the shares of a class other than ordinary shares shall be expressed in the Resolution creating the same; Proposed Amendments to Articles No director shall participate in an issue of shares or options to employees unless shareholders in general meeting have approved of the specific allotment to be made to such director. and unless he holds office in an executive capacity provided always that a director not holding office in an executive capacity may so participate in an issue of shares pursuant to a public offer or public issue; Deleted Existing Articles 4, (d) and (e) be renumbered as 4 (c) and (d) accordingly (e) In the event of the Company at any time issuing preference capital it shall at the same time indicate whether it reserves the right to issue further preference capital ranking equally with or in priority to the preference capital already issued; (f) (2) The holder of a preference share must be entitled to a return of capital in preference to holders of ordinary shares when the Company is wound up. 14. Subject to the provisions of the Act, the Central Depositories Act and the Rules, every person whose name is entered as a member in the register of members shall be entitled without payment to receive ten certificates for all his shares of each class and upon payment of such sum not exceeding $3/ or such other sum as may from time to time be permitted by the Exchange plus the stamp duty payable under any law for the time being in force for every additional certificate after the first ten certificates, each certificate to be in reasonable denominations. Where a member transfers part only of the shares comprised in a certificate the old certificate shall be cancelled and a new certificate for the balance of such shares issued in lieu without charge. Deleted and existing Article 4 (f) (3) be renumbered as 4 (f) (2) Deleted and replaced with: Subject to the provisions of the Act, the Central Depositories Act, the Rules and the Listing Requirements, the Company shall allot and/or issue securities, despatch notices of allotment to the successful allottees and make an application for the quotation and listing of such securities, within the relevant periods of such issue of securities as may be prescribed by the Exchange. 9

15 Existing Articles Every certificate shall be issued under the share seal and bear the signatures or the autographic signatures of one Director and the Secretary or a second Director or such other person as may be authorised by the Directors, and shall specify the shares to which it relates, and the amount paid up thereon. In the case of a share held jointly by several persons, the Company shall not be bound to issue more than one certificate therefor and delivery of a certificate to one of such person shall be sufficient delivery to all such persons. 31A Transmission of securities from Foreign Register (1) Where: (a) The securities of a company are listed on an Approved Market Place; and (b) such company is exempted from compliance with section 14 of the Securities Industry (Central Depositories) Act 1991 or section 29 of the Securities Industry (Central Depositories) (Amendment) Act 1998, as the case may be, under the Rules of the Central Depository in respect of such securities. such company shall, upon request of a securities holder, permit a transmission of securities held by such securities holder from the register of holders maintained by the registrar of the company in the jurisdiction of the Approved Market Place (hereinafter referred to as the Foreign Register ), to the register of holders maintained by the registrar of the company in Malaysia (hereinafter referred to as the Malaysian Register ) provided that there shall be no change in the ownership of such securities. (2) For the avoidance of doubt, no company which fulfills the requirements of subparagraphs (1) (a) and (b) above shall allow any transmission of securities from the Malaysian Register into the Foreign Register. Proposed Amendments to Articles Every certificate shall be issued under the share seal and bear the signatures or the autographic signatures of one Director and the Secretary or a second Director or such other person as may be authorised by the Directors, and shall specify the shares to which it relates, and the amount paid up thereon. In the case of a share held jointly by several persons, the Company shall not be bound to issue more than one certificate therefor and delivery of a certificate to one of such person shall be sufficient delivery to all such persons. Transmission of securities from Foreign Register Where: The securities of a company are listed on another stock exchange; and such company is exempted from compliance with section 14 of the Securities Industry (Central Depositories) Act 1991 or section 29 of the Securities Industry (Central Depositories) (Amendment) Act 1998, as the case may be, under the Rules of the Central Depository in respect of such securities. such company shall, upon request of a securities holder, permit a transmission of securities held by such securities holder from the register of holders maintained by the registrar of the company in the jurisdiction of the other stock exchange (hereinafter referred to as the Foreign Register ), to the register of holders maintained by the registrar of the company in Malaysia (hereinafter referred to as the Malaysian Register ) and vice versa provided that there shall be no change in the ownership of such securities. Deleted 10

16 Existing Articles 33.The transfer books and Register of Members and debenture holders may, on due notice being given as required by the Act, be closed during such time or times as the Directors think fit, not exceeding the whole thirty (30) days in each year. At least eighteen (18) market days notice of intention to close the said register shall be published in a daily newspaper and despatched to the relevant Stock Exchange. At least three (3) market days prior notice shall be given to the Central Depository to enable the Central Depository to prepare the appropriate Record of Depositors. 67.The notices convening meetings shall specify the place, day and hour of the meeting, and shall be given to all shareholders at least fourteen (14) days before the meeting or at least twenty one (21) days before the meeting where any special resolution is to be proposed or where it is an annual general meeting. Any notice of a meeting called to consider special business shall be accompanied by a statement regarding the effect of any proposed resolution in respect of such special business. At least fourteen (14) days notice or twenty one (21) days notice in the case where any special resolution is proposed or where it is an annual general meeting, of every such meeting shall be given by advertisement in the daily press and in writing to each stock exchange upon which the Company is listed. PROVIDED THAT in respect of Deposited Securities, the following provisions shall apply: (a) The Company shall request the Central Depository in accordance with the Rules of the Central Depository, to issue a Record of Depositors to whom notices of general meetings shall be given by the Company; (b) The Company shall also request the Central Depository in accordance with the Rules of the Central Depository, to issue a Record of Depositors, as at a date not less than 3 market days before the general meeting (hereinafter referred to as the General Meeting Record of Depositors. Proposed Amendments to Articles The transfer books and Register of Members and debenture holders may, on due notice being given as required by the Act, be closed during such time or times as the Directors think fit, not exceeding the whole thirty (30) days in each year. At least ten (10) market days notice, or such period as may from time to time be specified by the Stock Exchange, of the intention to close the said register shall be published in at least one (1) nationally circulated Bahasa Malaysia or English daily newspaper and notice shall also be given to the Stock Exchange. At the latest date which is reasonably practicable which shall in any event be not less than three (3) market days prior notice shall be given to the Depository to enable the Depository to prepare the appropriate Record of Depositors. The notices convening meetings shall specify the place, day and hour of the meeting, and shall be given to all shareholders at least fourteen (14) days before the meeting or at least twenty one (21) days before the meeting where any special resolution is to be proposed or where it is an annual general meeting. Any notice of a meeting called to consider special business shall be accompanied by a statement regarding the effect of any proposed resolution in respect of such special business. At least fourteen (14) days notice or twenty one (21) days notice in the case where any special resolution is proposed or where it is an annual general meeting, of every such meeting shall be given by advertisement in at least one (1) nationally circulated Bahasa Malaysia or English daily press and in writing to each stock exchange upon which the Company is listed. PROVIDED THAT in respect of Deposited Securities, the following provisions shall apply: No change The Company shall also request the Central Depository in accordance with the Rules of the Central Depository, to issue a Record of Depositors, as at the latest date which is reasonably practicable which shall in any event be not less than 3 market days before the general meeting (hereinafter referred to as the General Meeting Record of Depositors. 11

17 Existing Articles (c) Subject to the Securities Industry (Central Depositories) (Foreign Ownership) Regulations 1996, (where applicable) a depositor shall not be regarded as a member entitled to attend any general meeting and to speak and vote thereat unless his name appears in the General Meeting Record of Depositors. 83. Subject and without prejudice to any of the rights or restrictions as to voting for the time being attached to any class or classes of share for the time being forming part of the capital of the Company, at meetings of members or classes of members, each member entitled to vote may vote in person or by proxy or by attorney or by duly authorised representative on any question on a show of hands, every person present who is a member or a proxy or attorney or duly authorised representative shall have one vote, and on a poll, every member present in person or by proxy or by attorney or by duly authorised representative shall have one vote for each share he holds or represents. A proxy or attorney or duly authorised representative need not be a member of the Company. 87. A Power of Attorney or a certified copy thereof or the instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorized in writing. An instrument appointing a proxy to vote at a meeting shall be deemed to include the power to demand or concur in demanding poll on behalf of the appointor. A member may appoint more than two proxies to attend at the same meeting. Where a member appoints two or more proxies, he shall specify in the instrument appointing the proxies, the proportion of his shareholdings to be represented by each proxy PROVIDED that in the case of a vote on any question by a show of hands, only one (1) of the proxies so appointed shall be entitled to vote. 87A. Appointment of more than one proxy Proposed Amendments to Articles No Change Subject and without prejudice to any of the rights or restrictions as to voting for the time being attached to any class or classes of share for the time being forming part of the capital of the Company, at meetings of members or classes of members, each member entitled to vote may vote in person or by proxy or by attorney or by duly authorised representative on any question. On a resolution to be decided on a show of hands, every person present who is a member holding ordinary shares or preference shares or a proxy or attorney or duly authorised representative shall have one vote, and on a poll, every member present in person or by proxy or by attorney or by duly authorised representative shall have one vote for each share he holds or represents. A proxy or attorney or duly authorised representative need not be a member of the Company. A Power of Attorney or a certified copy thereof or the instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorized in writing. An instrument appointing a proxy to vote at a meeting shall be deemed to include the power to demand or concur in demanding poll on behalf of the appointor. A member may appoint more than up to two proxies to attend at the same meeting. Where a member appoints two or more proxies, he shall specify in the instrument appointing the proxies, the proportion of his shareholdings to be represented by each proxy PROVIDED that in the case of a vote on any question by a show of hands, only one (1) of the proxies so appointed shall be entitled to vote. The provisions of Section 149 (1) (b) of the Act shall not apply to the Company. Appointment of at least one proxy 12

18 Existing Articles 92. All Directors of the Company shall be natural persons. A Director shall not be required to hold any share qualification in the Company but subject to the provisions of the Act he shall not be of or over the age of 70 years at the date of his appointment. The first Directors of the Company shall be En. Abdul Aziz Bin Hj. Baharum, En.Tamby Chik Haji Hassan, Mr. Chen Tien Tsai and Mr. Yong Jaw Teck. 100.Subject as herein otherwise provided or to the terms of any subsisting agreement, the office of a Director shall be vacated: (a) If a receiving order in bankruptcy is made against him or he makes an any arrangement or composition with his creditors; (b) If he is found to be lunatic or becomes of unsound mind or a person whose person or estate is liable to be dealt with in any way under the law relating to mental disorder; Proposed Amendments to Articles All Directors of the Company shall be natural persons. A Director shall not be required to hold any share qualification in the Company but subject to the provisions of the Act he shall not be of or over the age of 70 years at the date of his appointment. The first Directors of the Company shall be En. Abdul Aziz Bin Hj.Baharum, En. Tamby Chik Haji Hassan, Mr. Chen Tien Tsai and Mr. Yong Jaw Teck. Subject as herein otherwise provided or to the terms of any subsisting agreement, the office of a Director shall be vacated: If a receiving order in bankruptcy is made against him or he makes an any arrangement or composition with his creditors; he becomes a bankrupt during his term of office; If he is found to be lunatic or becomes of unsound mind during his term of office or a person whose person or estate is liable to be dealt with in any way under the law relating to mental disorder; (c) If he is absent from more than 50% of the total board of Directors meetings held during a financial year, except when an exemption or waiver is obtained from the Stock Exchange; (d) If he is removed by a resolution of the Company in General Meeting of which special notice has been given; (e) If he is prohibited from being a Director by any order made under any provision of the Act or ceases to be a Director by virtue of the Act; (f) If by notice in writing given to the Company he resigns his office; (g) Subject to the provisions of the Act at the conclusion of the Annual General Meeting commencing next after he attains the age of 70 years Any dividend or other monies payable in cash on or in respect of a share may be paid by cheque or warrant sent through the post to the registered address of the member or person entitled thereto, if several persons are registered as joint holders of the share or are entitled thereto in consequence of the death or bankruptcy of the holder, to the registered address of any one of such or to such other Deleted No change No change No change No change Any dividend or other monies payable in cash on or in respect of a share may be paid by cheque or warrant sent through the post directed to the registered address of the member or person entitled thereto, or by way of direct transfer by means of electronic payment systems upon terms and conditions as the Directors may stipulate. if If several persons are registered as joint holders of the share or are entitled thereto in 13

19 Existing Articles person(s) at such other address(es) as such persons may direct in writing. Every such cheque or warrant shall be made payable to the order of the person to whom it is sent and delivery of the cheque by the Company aforesaid shall be a good discharge to the Company. Every such cheque or warrant shall be sent at the risk of the persons entitled to the money represented thereby. 147.The Directors shall from time to time in accordance with section 169 of the Companies Act, 1965 cause to be prepared and laid before the Company in general meeting such profit and loss accounts, balance sheets and reports as are referred to in the section. The interval between the close of a financial year of the Company and the issue of annual audited accounts, the Directors and auditors reports shall not exceed four (4) months. A copy of each of such documents shall together with the notice of the Annual General Meeting be sent to every member of, and to every holder of debentures of the Company under the provisions of the Companies Act, 1965 or of these presents. The requisite number of copies each of such documents as may be required by the Kuala Lumpur Stock Exchange and/or other such stock exchange(s), if any, upon which the Company s shares may be listed shall at the same time be likewise sent to the Kuala Lumpur Stock Exchange and/or other such stock exchange(s) provided that this Article shall not require a copy of these documents to be sent to any person of whose address the Company is not aware but any member to whom a copy of these documents has not been sent shall be entitled to receive a copy free of charge on application at the Company s Registered Office. Proposed Amendments to Articles consequence of the death or bankruptcy of the holder, to the registered address of any one of such or to such other person(s) at such other address(es) as such persons may direct in writing. Every such cheque or warrant shall be made payable to the order of the person to whom it is sent and delivery of the cheque by the Company aforesaid shall be a good discharge to the Company. Every such cheque or warrant shall be sent at the risk of the persons entitled to the money represented thereby. (a)the Directors shall from time to time in accordance with section 169 of the Companies Act, 1965 cause to be prepared and laid before the Company in general meeting such profit and loss accounts, balance sheets and reports as are referred to in the section. The interval between the close of a financial year of the Company and the issue of annual audited accounts, the Directors and auditors reports shall not exceed four (4) months. A copy of each of such documents shall together with the notice of the Annual General Meeting be sent (in hard copy or compact disc readonly memory ( CDROM ) or digital video disc ( DVDROM ) format or in any other format whatsoever, whether available now or in the future) to every member of, and to every holder of debentures of the Company under the provisions of the Companies Act, 1965 or of these presents. The requisite number of copies each of such documents as may be required by the Kuala Lumpur Stock Exchange and/or other such stock exchange(s), if any, upon which the Company s shares may be listed shall at the same time be likewise sent to the Kuala Lumpur Stock Exchange and/or other such stock exchange(s) provided that this Article shall not require a copy of these documents to be sent to any person of whose address the Company is not aware but any member to whom a copy of these documents has not been sent shall be entitled to receive a copy free of charge on application at the Company s Registered Office. (b)subject to the compliance with the requirements of the Stock Exchange and other relevant authorities, if any, the Company may issue its annual report in compact disc readonly memory ( CDROM ) or digital video disc ( DVDROM ) format or in any other format whatsoever, whether available now or in the future). 14

20 APPENDIX II FURTHER INFORMATION 1. Responsibility Statement This Circular has been seen and approved by the Board and they collectively and individually accept full responsibility for the accuracy of the information given and confirm that after making all reasonable enquiries and to the best of their knowledge and belief, there are no other material facts the omission of which would make any statement herein misleading. 2. Material Contracts Other than a Sale and Purchase Agreement dated 6 December 2007 and a Supplementary Agreement dated 14 January 2008 entered into between Daibochi Land Sdn Bhd, a wholly owned subsidiary of Daibochi, and Ivy Goh Soo Fern for the purchase of a piece of vacant leasehold land held under PN 40391, Lot 824, Kawasan Bandar VI, Mukim Melaka Tengah, Melaka measuring approximately 393,905 square feet for a purchase consideration of RM11,029,331 neither the Company nor its subsidiaries have entered into any material contracts (not being contracts entered into in the ordinary course of business of the Group), during the past two (2) years preceding the date of this Circular. 3. Material Litigation Daibochi and its subsidiaries have not engaged in any material litigations, claims or arbitration, either as plaintiff or defendant which has a material effect on the financial position of the Company or its subsidiaries, and the Directors do not know of any proceedings pending or threatened or of any fact likely to give rise to any proceeding which might materially and adversely affect the position or business of the Company or its subsidiaries. 4. Documents for Inspection Copies of the following documents are available for inspection at the registered office of the Company following the publication of this circular from Mondays to Fridays (except public holidays) during business hours up to and including the date of the AGM: (i) the Memorandum and Articles of Association of the Company; (ii) the audited financial statements of Daibochi Group for the financial years ended 31 December 2006 and 31 December 2007; and (iii) the material contracts referred to in paragraph 2 above. 15

21 APPENDIX III EXTRACT OF RESOLUTIONS TO BE TABLED AT THE 35 TH AGM OF THE COMPANY ORDINARY RESOLUTION Proposed Renewal of Share BuyBack Authority THAT, subject always to the Companies Act, 1965 ( the Act ), rules, regulations and orders made pursuant to the Act, provisions of the Company s Memorandum and Articles of Association and the requirements of Bursa Malaysia Securities Berhad ( Bursa Securities ) and any other relevant authority, the Company be and is hereby authorised to purchase such amount of ordinary shares of RM1.00 each in the Company as may be determined by the Directors of the Company from time to time through Bursa Securities upon such terms and conditions as the Directors may deem fit, necessary and expedient in the interest of the Company PROVIDED THAT: (a) the total aggregate number of ordinary shares of RM1.00 each in the Company which may be purchased and/or held by the Company shall not exceed ten percent (10%) of the total issued and paidup share capital of the Company as quoted on Bursa Securities as at the point of purchase, subject to a restriction that the issued and paidup share capital of the Company does not fall below the applicable minimum share capital requirement of the Listing Requirements of Bursa Securities; (b) the maximum funds to be allocated by the Company for the purpose of purchasing the shares shall not exceed the Company s latest audited retained earnings and/or share premium account; (c) the authority conferred by this resolution will commence immediately upon passing of this ordinary resolution and will continue to be in force until: (i) the conclusion of the next AGM at which time it shall lapse unless by ordinary resolution passed at the meeting, the authority is renewed, either unconditionally or subject to conditions; or (ii) the expiration of the period within which the next AGM after that date is required by law to be held; or (iii) revoked or varied by ordinary resolution passed by the shareholders of the Company in a general meeting; whichever occurs first; AND THAT, the Directors of the Company be and are hereby authorised to cancel all the shares or any part thereof so purchased or to retain all the shares so purchased as treasury shares (of which may be distributed as dividends to shareholders and/or resold on Bursa Securities and/or subsequently cancelled), or to retain part of the shares so purchased as treasury shares and cancel the remainder, and in any other manner as prescribed by the Act, rules, regulations and orders made pursuant to the Act, the Listing Requirements of Bursa Securities and any other relevant authorities for the time being in force. AND THAT, the Directors of the Company be and are hereby authorised to take all such steps as are necessary or expedient to implement, finalise or to effect the aforesaid share buyback with full powers to assent to any conditions, modifications, variations and/or amendments, as may be required or imposed by the relevant authorities and to do all such acts and things (including executing all documents) as the Directors may deem fit and expedient in the best interest of the Company. SPECIAL RESOLUTION Proposed Amendments to the Articles of Association of the Company THAT, the proposed amendments to the existing Articles of Association of the Company as set out under Part B, Appendix I of the Statement/Circular to Shareholders dated 29 April 2008 be and are hereby approved and adopted. AND THAT, the Directors of the Company be and are hereby authorised to assent to any modifications, variations and/or amendments, as may be required or imposed by the relevant authorities and to do all such acts and things and to take all such steps as may be considered necessary to give full effect to the Proposed Amendments to the Articles of Association of the Company. 16