CIRCULAR/STATEMENT TO SHAREHOLDERS. in relation to the PART A PART B PART C

Transcription

1 THIS CIRCULAR/STATEMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to the course of action you should take, you should consult your stockbroker, bank manager, solicitor, accountant or other independent adviser immediately. Bursa Malaysia Securities Berhad ( Exchange ) has not perused Part B and Part C prior to its issuance as it is an exempt circular/statement. The Exchange takes no responsibility for the contents of this Circular/Share Buy-Back Statement, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this Circular/Share Buy-Back Statement. (Company No K) (Incorporated in Malaysia) CIRCULAR/STATEMENT TO SHAREHOLDERS in relation to the PART A PROPOSED RENEWAL OF AND NEW SHAREHOLDERS MANDATE FOR RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE PART B PROPOSED RENEWAL OF AUTHORITY TO PURCHASE ITS OWN SHARES BY THE COMPANY PART C PROPOSED AMENDMENTS TO THE COMPANY S ARTICLES OF ASSOCIATION Notice of the Annual General Meeting which will be held at Dewan Berjaya, Bukit Kiara Equestrian & Country Resort, Jalan Bukit Kiara, Off Jalan Damansara, Kuala Lumpur on Friday,18 October 2013 at a.m. together with the Form of Proxy are enclosed in the Annual Report The Form of Proxy must be lodged at the Registered Office of the Company not less than 48 hours before the time fixed for the Meeting. The lodging of the Form of Proxy will not preclude you from attending and voting at the Meeting if you are subsequently able to do so. This Circular/Statement is dated 24 September 2013.

2 DEFINITIONS Except where the context otherwise requires, the following definitions shall apply throughout this Circular/Statement:- Act : The Malaysian Companies Act, 1965, including any amendment that may be made thereto from time to time AGM : Annual General Meeting Annual Report 2013 : The annual report of BToto for the financial year ended 30 April 2013 Ascot Sports : Ascot Sports Sdn Bhd Auto Tulin : Auto Tulin Sdn Bhd B&B : B & B Enterprise Sdn Bhd BAssets : Berjaya Assets Berhad BCorporation : Berjaya Corporation Berhad BGroup : Berjaya Group Berhad BHills : Berjaya Hills Berhad Biofield : Biofield Sdn Bhd Bizurai Bijak : Bizurai Bijak (M) Sdn Bhd BLand : Berjaya Land Berhad BMedia : Berjaya Media Berhad Board : Board of Directors BRetail : Berjaya Retail Berhad BToto or the Company : Berjaya Sports Toto Berhad BToto Cayman : Berjaya Sports Toto (Cayman) Limited BToto Group or the Group : BToto and its subsidiary companies BToto Shares : Ordinary shares of RM0.10 each in BToto BTSSB : Berjaya Times Square Sdn Bhd CCL : Cosway Corporation Limited CKS : Mr. Chan Kien Sing Code : Malaysian Code on Take-Overs and Mergers, 2010 CTK : Mr. Cheah Tek Kuang

3 DEFINITIONS (Cont d) Desiran Unggul : Desiran Unggul Sdn Bhd Director : Has the meaning given in Section 2(1) of the Capital Markets and Services Act 2007 and includes any person who is or was within the preceding six (6) months of the date on which the terms of the transaction were agreed upon, a Director of BToto, its subsidiary or holding company or a chief executive officer of BToto, its subsidiary or holding company DRTYC : Dato Robin Tan Yeong Ching DRY : Datuk Robert Yong Kuen Loke DDTYL : Dato Dickson Tan Yong Loong EGM : Extraordinary General Meeting EPS : Earnings per share Exchange : Bursa Malaysia Securities Berhad Family : In relation to a person means such person who falls within any one of the following categories:- (a) (b) (c) (d) (e) spouse; parent; child including an adopted child and step-child; brother or sister; and spouse of the person referred to in subparagraphs (c) and (d) above. FEAB Properties : FEAB Properties Sdn Bhd FP : Mr. Freddie Pang Hock Cheng Graphic Press : Graphic Press Group Sdn Bhd HQZ : HQZ Credit Sdn Bhd HRESB : Hotel Resort Enterprise Sdn Bhd LBSB : Lengkap Bahagia Sdn Bhd Listing Requirements : Exchange s Main Market Listing Requirements, including any amendment that may be made from time to time Magna Mahsuri : Magna Mahsuri Sdn Bhd Major Shareholder : A person who has an interest or interests in one or more voting shares in BToto and the nominal amount of that share, or the aggregate of the nominal amounts of those shares, is:- (a) (b) 10% or more of the aggregate of the nominal amounts of all the voting shares in BToto; or 5% or more of the aggregate of the nominal amounts of all the voting shares in BToto where such person is the largest shareholder of BToto.

4 DEFINITIONS (Cont d) For the purpose of this definition, interest in shares shall have the meaning given in Section 6A of the Act. A major shareholder includes any person who is or was within the preceding six (6) months of the date on which the terms of the transaction were agreed upon, a major shareholder of BToto or any other company which is its subsidiary or holding company. MOL.com : MOL.com Sdn Bhd NA : Net assets attributable to ordinary equity holders of BToto Nautilus : Nautilus Corporation Sdn Bhd Person(s) Connected : In relation to a Director or a Major Shareholder, means such person who falls under any one of the following categories:- Premier Merchandise : Premier Merchandise Sdn Bhd (a) a family member of the Director or Major Shareholder; (b) a trustee of a trust (other than a trustee for an employee share scheme or pension scheme) under which the Director, Major Shareholder or a family member of the Director or Major Shareholder, is the sole beneficiary; (c) a partner of the Director, Major Shareholder, or a partner of a Person Connected with that Director or Major Shareholder; (d) a person who is accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the Director or Major Shareholder; (e) a person in accordance with whose directions, instructions or wishes the Director or Major Shareholder is accustomed or is under an obligation, whether formal or informal, to act; (f) a body corporate or its directors which/who is/are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the Director or Major Shareholder; (g) a body corporate or its directors whose directions, instructions or wishes the Director or Major Shareholder is accustomed or under an obligation, whether formal or informal, to act; (h) a body corporate in which the Director, Major Shareholder or Persons Connected with him are entitled to exercise, or control the exercise of, not less than 15% of the votes attached to voting shares in the body corporate; or (i) a body corporate which is a related corporation. Prevailing Laws : Any prevailing laws, rules, regulations, orders, guidelines and requirements issued by the relevant authorities Proposed Amendments : The proposed amendments to the Articles of Association of BToto to be in line with the recent amendments to the Listing Requirements Proposed Mandate : Proposed renewal of and new shareholders mandate for BToto Group to enter into Recurrent Related Party Transactions in the ordinary course of business Proposed Share Buy-Back : The proposed renewal of authority to purchase and/or hold of BToto Shares of up to 10% of the issued and paid-up ordinary share capital of the Company inclusive of the 15,530,072 BToto Shares in the Company already purchased and retained as Treasury Shares

5 DEFINITIONS (Cont d) Qinetics : Qinetics Solutions Sdn Bhd Qinetics Services : Qinetics Services Sdn Bhd Recurrent Related Party Transactions : Transactions which are recurrent, of a revenue or trading nature and which are necessary for the day-to-day operations of the BToto Group and involve the interests, direct or indirect, of Related Parties Related Party : A Director, Major Shareholder or Person Connected with such Director or Major Shareholder RM and sen : Ringgit Malaysia and sen respectively Roda Indah : Roda Indah Motors Sdn Bhd RTYS : Mr. Rayvin Tan Yeong Sheik Share Purchased : BToto Shares purchased under the Proposed Share Buy Back STCSB : Sports Toto Computer Sdn Bhd STFSB : Sports Toto Fitness Sdn Bhd STMSB : Sports Toto Malaysia Sdn Bhd STMM : Sports Toto Malaysia Management Pte. Ltd. Sublime Cartel : Sublime Cartel Sdn Bhd Treasury Shares : BToto Shares purchased by BToto which will be retained in treasury TSDT : Tan Sri Dato Tan Chee Sing TSVT : Tan Sri Dato Seri Vincent Tan Chee Yioun U Mobile : U Mobile Sdn Bhd U Telemedia : U Telemedia Sdn Bhd

6 TABLE OF CONTENTS PART A LETTER TO THE SHAREHOLDERS OF BTOTO ON THE PROPOSED MANDATE Page 1. INTRODUCTION 1 2. DETAILS OF THE PROPOSED MANDATE 1 3. RATIONALE FOR, AND THE BENEFIT TO THE BTOTO GROUP FROM TRANSACTING WITH RELATED PARTIES CONDITIONS FOR THE PROPOSED MANDATE FINANCIAL EFFECTS OF THE PROPOSED MANDATE DIRECTORS AND MAJOR SHAREHOLDERS INTERESTS DIRECTORS RECOMMENDATION AGM FURTHER INFORMATION 19 PART B SHARE BUY-BACK STATEMENT Page 1. INTRODUCTION DETAILS OF THE PROPOSED SHARE BUY-BACK RATIONALE FOR THE PROPOSED SHARE BUY-BACK POTENTIAL ADVANTAGES AND DISADVANTAGES OF THE PROPOSED SHARE BUY-BACK EFFECTS OF THE PROPOSED SHARE BUY-BACK IMPLICATION RELATING TO THE CODE DIRECTORS AND SUBSTANTIAL SHAREHOLDERS INTERESTS DIRECTORS RECOMMENDATION FURTHER INFORMATION 25

7 PART C LETTER TO THE SHAREHOLDERS OF BTOTO ON THE PROPOSED AMENDMENTS Page 1. INTRODUCTION DETAILS OF THE PROPOSED AMENDMENTS RATIONALE FOR THE PROPOSED AMENDMENTS DIRECTORS RECOMMENDATION AGM FURTHER INFORMATION 27 APPENDIX I PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF THE COMPANY 28 APPENDIX II FURTHER INFORMATION 29 EXTRACT OF RESOLUTIONS TO BE TABLED AT THE FORTHCOMING BTOTO AGM ENCLOSED

8 PART A CIRCULAR TO SHAREHOLDERS in relation to the PROPOSED RENEWAL OF AND NEW SHAREHOLDERS MANDATE FOR RECURRENT RELATED PARTY TRANSACTION OF A REVENUE OR TRADING NATURE

9 BERJAYA SPORTS TOTO BERHAD (Company No: 9109-K) (Incorporated in Malaysia) Registered Office: Lot 13-01A, Level 13 (East Wing) Berjaya Times Square No. 1 Jalan Imbi Kuala Lumpur 24 September 2013 Directors: Cheah Tek Kuang (Chairman/Independent Non-Executive Director) Dato Robin Tan Yeong Ching (Chief Executive Officer) Freddie Pang Hock Cheng (Executive Director) Chan Kien Sing (Executive Director) Seow Swee Pin (Executive Director) Dato Dickson Tan Yong Loong (Non-Independent Non-Executive Director) Mohamed Saleh bin Gomu (Independent Non-Executive Director) Datuk Robert Yong Kuen Loke (Independent Non-Executive Director) To: The Shareholders of BToto Dear Sir/Madam, PROPOSED RENEWAL OF AND NEW SHAREHOLDERS MANDATE FOR RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE 1.0 INTRODUCTION 1.1 The Board of BToto had on 12 September 2013 announced its intention to seek shareholders approval for the proposed renewal of and new shareholders mandate for Recurrent Related Party Transactions. 1.2 The purpose of this Circular is to provide you with the relevant information on the Proposed Mandate and to seek your approval for the ordinary resolution to be tabled at the forthcoming AGM of the Company. The Notice of AGM is set out in the Annual Report The extract of ordinary resolution on the Proposed Mandate to be tabled at the forthcoming BToto AGM is enclosed together with this Circular. 2.0 DETAILS OF THE PROPOSED MANDATE 2.1 The Proposed Mandate The Company had on 17 October 2012 obtained its shareholders mandate for the BToto Group to enter into Recurrent Related Party Transactions on terms that are not more favourable to the Related Parties than those generally available to the public. The approval shall in accordance with the Listing Requirements lapse at the conclusion of the forthcoming AGM of the Company scheduled on 18 October 2013 unless approval for its renewal is obtained from the shareholders of the Company at the forthcoming AGM. 1

10 2.1.2 Pursuant to Paragraph 10.09(2) of the Listing Requirements, BToto may seek a shareholders mandate in respect of Recurrent Related Party Transactions subject to the following:- (i) (ii) (iii) (iv) (v) the transactions are in the ordinary course of business and are on terms not more favourable to the related party than those generally available to the public; the shareholders mandate is subject to annual renewal and disclosure is made in the annual report of the aggregate value of transactions conducted pursuant to the shareholders mandate during the financial year where the aggregate value is equal to or more than the threshold prescribed under Paragraph 10.09(1) of the Listing Requirements; the circular to shareholders for the shareholders mandate includes the information as may be prescribed by the Exchange. The draft circular must be submitted to the Exchange together with a checklist showing compliance with such information; in a meeting to obtain shareholders mandate, the interested Director, interested Major Shareholder or interested Person Connected with a Director or Major Shareholder; and where it involves the interest of an interested Person Connected with a Director or Major Shareholder, such Director or Major Shareholder, must not vote on the resolution to approve the transactions. An interested Director or interested Major Shareholder must ensure that Persons Connected with him abstain from voting on the resolution approving the transactions; and BToto immediately announces to the Exchange when the actual value of a Recurrent Related Party Transaction entered into by the BToto Group exceeds the estimated value of the Recurrent Related Party Transaction disclosed in the circular by 10% or more and must include the information as may be prescribed by the Exchange in its announcement. Transactions entered into between BToto (or any of its wholly-owned subsidiaries) and its whollyowned subsidiaries are excluded from the requirements of Part E of Chapter 10 of the Listing Requirements The Proposed Mandate, if approved by the BToto shareholders at the forthcoming AGM, will take effect from the date of passing of the ordinary resolution at the forthcoming AGM and shall continue to be in force until:- (i) (ii) (iii) the conclusion of the next AGM of BToto following the forthcoming AGM at which such ordinary resolution for the Proposed Mandate will be passed, at which time it will lapse, unless by a resolution passed at a general meeting, the authority is renewed; the expiration of the period within the next AGM after the date it is required to be held pursuant to Section 143 (1) of the Act (but must not extend to such extension as may be allowed pursuant to Section 143 (2) of the Act); or revoked or varied by resolution passed by the shareholders at a general meeting; whichever is the earlier. 2.2 Information On The BToto Group The principal activities of BToto are investment holding and provision of management services. The principal activities of its subsidiary companies are operations of Toto betting under Section 5 of the Pool Betting Act, 1967, leasing of on-line lottery equipment, manufacture and distribution of computerised lottery and voting systems, property investment and development and operation of health and fitness centre. 2

11 The list of subsidiary companies of BToto which are involved in the Recurrent Related Party Transactions are set out below:- Name of Company Equity Interest Held (%) Principal Activities FEAB Properties Property investment and development and investment holding STFSB Operation of health and fitness centre STMSB Toto betting operations Magna Mahsuri Property investment and investment holding STMM Asset management (trustee-manager) Subsidiaries of Magna Mahsuri BToto Cayman STCSB Investment holding Computer consultancy services Subsidiary of Berjaya Sports Toto (Cayman) Limited Berjaya Lottery Management (HK) Limited Investment holding Subsidiary of Berjaya Lottery Management (HK) Limited International Lottery & Totalizator Systems, Inc Manufacturer and distributor of computerized lottery and voting systems Details of the Recurrent Related Party Transactions of the BToto Group which are in accordance with Paragraph 10.09(2) of the Listing Requirements are set out in the ensuing paragraphs. 2.3 Class And Nature Of The Recurrent Related Party Transactions The class and nature of the Recurrent Related Party Transactions of BToto Group are tabulated as follows:- 3

12 BToto Group with the following Related Parties Nature of transactions undertaken by BToto and/or its unlisted subsidiary companies Interested Directors/ Major Shareholders and/or Persons Connected to them Estimated value from 18/10/13 to the date of next AGM (RM 000) BCorporation and its unlisted subsidiary companies:- BCorporation Management fees payable by BToto for services rendered that include, inter-alia, the provision of finance, secretarial and general administrative services TSVT, DRTYC and Persons Connected with them (including their Family) as mentioned in the notes of Sections 2.3 and Berjaya Registration Services Sdn Bhd Receipt of share registration services by BToto TSVT, DRTYC and Persons Connected with them (including their Family) as mentioned in the notes of Sections 2.3 and 6.1 1,000 Berjaya Higher Education Sdn Bhd Rental income receivable by Magna Mahsuri at RM220,406 per month for renting of office at part of Level 11, Berjaya Times Square, Jalan Imbi, Kuala Lumpur. Rental is payable on a monthly basis. Tenure of the rental agreement is for a period of 3 years and renewable thereafter TSVT, DRTYC and Persons Connected with them (including their Family) as mentioned in the notes of Sections 2.3 and 6.1 2,645 Inter-Pacific Trading Sdn Bhd Purchase of stationery products by BToto, STMSB, STFSB and Magna Mahsuri# TSVT, DRTYC and Persons Connected with them (including their Family) as mentioned in the notes of Sections 2.3 and Berjaya Education Sdn Bhd Receipt of education and staff training services by the BToto Group TSVT, DRTYC and Persons Connected with them (including their Family) as mentioned in the notes of Sections 2.3 and Graphic Press Procurement of Toto betting slips printing services by STMSB TSVT, DRTYC, and Persons Connected with them (including their Family) as mentioned in the notes of Sections 2.3 and ,000 4

13 BToto Group with the following Related Parties Nature of transactions undertaken by BToto and/or its unlisted subsidiary companies Interested Directors/ Major Shareholders and/or Persons Connected to them Estimated value from 18/10/13 to the date of next AGM (RM 000) Prime Credit Leasing Sdn Bhd Receipt of leasing and hire purchase facilities by the BToto Group TSVT, DRTYC, and Persons Connected with them (including their Family) as mentioned in the notes of Sections 2.3 and 6.1 3,800 Kimia Suchi Marketing Sdn Bhd Purchase of cleaning chemical products and toiletries by STFSB TSVT, DRTYC and Persons Connected with them (including their Family) as mentioned in the notes of Sections 2.3 and Ambilan Imej Sdn Bhd Rental payable by BToto:- 1. at RM173,399 per month for renting of office at part of Level 12, Berjaya Times Square, Jalan Imbi, Kuala Lumpur. Rental is payable on a monthly basis. Tenure of the rental agreement is for a period of 2 years and renewable thereafter TSVT, DRTYC and Persons Connected with them (including their Family) as mentioned in the notes of Sections 2.3 and 6.1 2, at RM30,299 per month for renting of office at part of Level 12, Berjaya Times Square, Jalan Imbi, Kuala Lumpur. Rental is payable on a monthly basis. Tenure of the rental agreement is for a period of 2 years and renewable thereafter 364 Stephens Properties Sdn Bhd Rental payable by BToto at RM330 per month for renting of storage space at Lots 26E & F, Wisma Cosway, Jalan Raja Chulan, Kuala Lumpur. Rental is payable on a monthly basis. Tenure of the rental agreement is for a period of 1 year and renewable thereafter TSVT, DRTYC and Persons Connected with them (including their Family) as mentioned in the notes of Sections 2.3 and

14 BToto Group with the following Related Parties Nature of transactions undertaken by BToto and/or its unlisted subsidiary companies Interested Directors/ Major Shareholders and/or Persons Connected to them Estimated value from 18/10/13 to the date of next AGM (RM 000) Bermaz Motor Trading Sdn Bhd Purchase of motor vehicles, component parts and other related products and services by the BToto Group * TSVT, DRTYC and Persons Connected with them (including their Family) as mentioned in the notes of Sections 2.3 and 6.1 1,500 Total 28,589 BLand and/or its unlisted subsidiary companies:- Berjaya Guard 5,000 Services Sdn Bhd Receipt of security guard services by the BToto Group TSVT, DRTYC, BCorporation and Persons Connected with TSVT, DRTYC (including their Family) and BCorporation as mentioned in the notes of Sections 2.3 and 6.1 Berjaya Langkawi Beach Resort Sdn Bhd Rental payable by BToto at RM15,000 per month for renting of villa at Berjaya Langkawi Resort, Burau Bay, Pulau Langkawi, Kedah. Rental is payable on a monthly basis based on mutual agreement by way of letter for a period of 1 month and renewable thereafter TSVT, DRTYC, BCorporation and Persons Connected with TSVT, DRTYC (including their Family) and BCorporation as mentioned in the notes of Sections 2.3 and Rental income receivable by FEAB Properties at RM9,000 per month for renting of restaurant at Plot C, Teluk Burau, Padang Matsirat, Pulau Langkawi, Kedah. Rental is payable on a monthly basis. Tenure of the rental agreement is for a period of 2 years and renewable thereafter 108 Berjaya Air Sdn Bhd Dry lease charges payable by STMSB for aircraft leasing facilities TSVT, DRTYC, BCorporation and Persons Connected with TSVT, DRTYC (including their Family) and BCorporation as mentioned in the notes of Sections 2.3 and 6.1 1,500 6

15 BToto Group with the following Related Parties Nature of transactions undertaken by BToto and/or its unlisted subsidiary companies Interested Directors/ Major Shareholders and/or Persons Connected to them Estimated value from 18/10/13 to the date of next AGM (RM 000) Nada Embun Sdn Bhd Rental payable by:- 1. STMSB at RM126,360 per month for renting of office at Lot 13-01, Level 13, Berjaya Times Square, Jalan Imbi, Kuala Lumpur. Rental is payable on a monthly basis. Tenure of the rental agreement is for a period of 2 years and renewable thereafter TSVT, DRTYC, BCorporation and Persons Connected with TSVT, DRTYC (including their Family) and BCorporation as mentioned in the notes of Sections 2.3 and 6.1 1, BToto at RM22,980 per month for renting of office at part of Level 13, Berjaya Times Square, Jalan Imbi, Kuala Lumpur. Rental is payable on a monthly basis. Tenure of the rental agreement is for a period of 2 years and renewable thereafter BToto at RM2,754 per month for renting of office at part of Level 13, Berjaya Times Square, Jalan Imbi, Kuala Lumpur. Rental is payable on a monthly basis. Tenure of the rental agreement is for a period of 2 years and renewable thereafter 33 Berjaya Jet Charter Sdn Bhd Charter fees payable by the BToto Group for aircraft leasing facilities TSVT, DRTYC, BCorporation and Persons Connected with TSVT, DRTYC (including their Family) and BCorporation as mentioned in the notes of Sections 2.3 and 6.1 8,950 7

16 BToto Group with the following Related Parties Nature of transactions undertaken by BToto and/or its unlisted subsidiary companies Interested Directors/ Major Shareholders and/or Persons Connected to them Estimated value from 18/10/13 to the date of next AGM (RM 000) Nural Enterprise Sdn Bhd Rental payable by STMSB:- 1. at RM5,432 per month for renting of apartments at Lots 5.3, 5.4 & 5.6, 5 th Floor, Podium Block, Plaza Berjaya, Jalan Imbi, Kuala Lumpur. Rental is payable on a monthly basis based on mutual agreement by way of letter for a period of 1 month and renewable thereafter TSVT, DRTYC, BCorporation and Persons Connected with TSVT, DRTYC (including their Family) and BCorporation as mentioned in the notes of Sections 2.3 and at RM1,828 per month for renting of apartment at Lot 10.4, 10 th Floor, Podium Block, Plaza Berjaya, Jalan Imbi, Kuala Lumpur. Rental is payable on a monthly basis based on mutual agreement by way of letter for a period of 1 month and renewable therafter at RM2,234 per month for renting of apartment at Lot 12.2, 12 th Floor, Podium Block, Plaza Berjaya, Jalan Imbi, Kuala Lumpur. Rental is payable on a monthly basis based on mutual agreement by way of letter for a period of 1 month and renewable thereafter 27 Total 17,677 8

17 BToto Group with the following Related Parties Nature of transactions undertaken by BToto and/or its unlisted subsidiary companies Interested Directors/ Major Shareholders and/or Persons Connected to them Estimated value from 18/10/13 to the date of next AGM (RM 000) BAssets and/or its unlisted subsidiary companies:- Natural Avenue Sdn Supply of computerised Bhd lottery systems and related services by International Lottery & Totalizator Systems, Inc. TSVT, DRTYC, BLand, BCorporation and Persons Connected with TSVT, DRTYC (including their Family), BLand and BCorporation as mentioned in the notes of Sections 2.3 and 6.1 1,000 BTSSB Rental payable by STCSB at RM5,169 per month for renting of office at Lots 09-88, & 09-90, 9 th Floor, Berjaya Times Square, Jalan Imbi, Kuala Lumpur. Rental is payable on a monthly basis. Tenure of the rental agreement is for a period of 3 years and renewable thereafter TSVT, DRTYC, BLand, BCorporation and Persons Connected with TSVT, DRTYC (including their Family), BLand and BCorporation as mentioned in the notes of Sections 2.3 and BTS Car Park Sdn Bhd Parking charges payable by STMSB, BToto, STCSB and Magna Mahsuri# TSVT, DRTYC, BLand, BCorporation and Persons Connected with TSVT, DRTYC (including their Family), BLand and BCorporation as mentioned in the notes of Sections 2.3 and Total 1,587 BMedia and/or its unlisted subsidiary company:- Sun Media 3,400 Corporation Sdn Bhd Procurement of promotion, advertising and publishing services by the BToto Group TSVT, DRTYC, BCorporation and Persons Connected with TSVT, DRTYC (including their Family) and BCorporation as mentioned in the notes of Sections 2.3 and 6.1 Other related parties:- Biofield Rental payable by STFSB at RM36,864 per month for renting of shoplot at Lot 06-11, Level 6, Berjaya Times Square, Jalan Imbi, Kuala Lumpur. Rental is payable on a monthly basis. Tenure of the rental agreement is for a period of 3 years and renewable thereafter TSVT, DRTYC and Persons Connected with them (including their Family) as mentioned in the notes of Sections 2.3 and

18 BToto Group with the following Related Parties Nature of transactions undertaken by BToto and/or its unlisted subsidiary companies Interested Directors/ Major Shareholders and/or Persons Connected to them Estimated value from 18/10/13 to the date of next AGM (RM 000) Roda Indah Purchase of motor vehicles, component parts and other related products and services by the BToto Group TSVT, DRTYC and Persons Connected with them (including their Family) as mentioned in the notes of Sections 2.3 and 6.1 2,700 U Mobile Rental income receivable by Magna Mahsuri at RM107,190 per month for renting of office at part of Level 11, Berjaya Times Square, Jalan Imbi, Kuala Lumpur. Rental is payable on a monthly basis. Tenure of the rental agreement is for a period of 2 years and renewable thereafter TSVT, DRTYC, DDTYL and Persons Connected with them (including their Family) as mentioned in the notes of Sections 2.3 and 6.1 1,286 Ascot Sports Rental payable by STMSB at RM14,412 per month for renting of office at part of Lot 10-01, Level 10, Berjaya Time Square, Jalan Imbi, Kuala Lumpur. Rental is payable on a monthly basis. Tenure of the rental agreement is for a period of 1 year and renewable thereafter TSVT, DRTYC and Persons Connected with them (including their Family) as mentioned in the notes of Sections 2.3 and Qinetics Services Purchase of hardware, software, networking equipments, and information technology consultancy, data storage, maintenance and management services by the BToto Group* TSVT, DRTYC, BCorporation and Persons Connected with TSVT, DRTYC (including their Family) and BCorporation as mentioned in the notes of Sections 2.3 and 6.1 3,700 Total 8,301 Grand Total 59,554 Notes:- * New Recurrent Related Party Transactions which were not covered in the previous general mandate. # New Transacting parties (1) The estimated values from 18 October 2013 to the date of next AGM in 2014 are based on historical records and budgets of the respective Recurrent Related Party Transactions. The actual value of these transactions may differ from the said estimated values. (2) BCorporation is a Major Shareholder of BLand, BToto, BAssets and BMedia and its direct and indirect interests in these companies other than BToto as at 30 August 2013 are set out below:- 10

19 % of Interest Direct Indirect BLand (a) BAssets Nil (a) BMedia Nil (b) Notes:- (a) (b) Deemed interested by virtue of its 100% interest in BGroup. Deemed interested by virtue of its 100% interests in BGroup and BHills. (3) TSVT is a Major Shareholder of BCorporation by virtue of his direct interest and deemed interest in BCorporation. By virtue of his interests in BCorporation, TSVT is deemed interested in the shares of BCorporation s subsidiaries to the extent BCorporation has an interest. TSVT s direct and indirect interests in BCorporation, BLand, BAssets and BMedia as at 30 August 2013 are set out below:- % of Interest Direct Indirect BCorporation (a) BLand (b) BAssets (c) BMedia (d) Notes:- (a) (b) (c) (d) Deemed interested by virtue of his interests in HRESB, Nostalgia Kiara Sdn Bhd, Superior Structure Sdn Bhd, BAssets (the holding company of BTSSB and Sublime Cartel), BMedia (the holding company of Gemtech (M) Sdn Bhd), B&B (the holding company of LBSB and Nautilus) and HQZ (the ultimate holding company of Desiran Unggul and Premier Merchandise). Deemed interested by virtue of his interests in BCorporation, HRESB, B&B, BAssets (the holding company of BTSSB and Sublime Cartel) and HQZ (the ultimate holding company of Desiran Unggul and Premier Merchandise). Deemed interested by virtue of his interests in BCorporation, Vecc-Men Holdings Sdn Bhd, HRESB, B&B, Berjaya VTCY Sdn Bhd and his deemed interest in Lim Kim Hai Sales & Services Sdn Bhd. Deemed interested by virtue of his interests in BCorporation, HRESB, Nostalgia Kiara Sdn Bhd, Superior Structure Sdn Bhd, BAssets (the holding company of BTSSB and Sublime Cartel), B&B (the holding company of LBSB and Nautilus) and HQZ (the ultimate holding company of Desiran Unggul and Premier Merchandise). (4) DRTYC, the Chief Executive Officer of BToto, is the Chairman/Chief Executive Officer of BCorporation and the Chairman of BMedia. DRTYC is also a deemed substantial shareholder of BCorporation and BMedia. He is also a shareholder of BLand, BToto and BAssets. DRTYC is a son of TSVT. Hence, DRTYC and TSVT are Persons Connected with each other. DRTYC s direct and indirect interests in the aforementioned companies other than BToto as at 30 August 2013 are set out below:- % of Interest Direct Indirect BCorporation (a) BLand (a) BAssets (a) BMedia (a) Note:- (a) Deemed interested by virtue of his interest in HRESB. 11

20 (5) Biofield is an indirect wholly-owned subsidiary of BRetail which in turn is a wholly-owned subsidiary of Premier Merchandise, a wholly-owned subsidiary of Intan Utilities Berhad. TSVT is a deemed Major Shareholder of Intan Utilities Berhad by virtue of his 99.99% interest in HQZ, the ultimate holding company of Intan Utilities Berhad. (6) Roda Indah is a wholly-owned subsidiary of B&B. TSVT is a deemed Major Shareholder of Roda Indah by virtue of his 96.99% interest in B&B. (7) U Mobile is 36.99% owned by U Telemedia. TSVT, a Director of U Mobile has a direct interest of 2.36% in U Mobile and 34.79% in U Telemedia. TSVT is also a Major Shareholder of Vecc-Men Holdings Sdn Bhd, HQZ and B&B which holds 0.82%, 6.00% and 4.38% equity interests in U Telemedia respectively. TSDT, a Director of U Mobile, is a Major Shareholder of Glorious Reflection Sdn Bhd which has a direct interest of 5.32% in U Mobile. TSDT is a brother of TSVT and the father of DDTYL. Hence, TSDT is a Person Connected with TSVT and DDTYL. (8) Qinetics Services is a wholly-owned subsidiary of Qinetics which in turn is an 88%-owned subsidiary of MOL.com. TSVT and BCorporation are Major Shareholders of Qinetics by virtue of their interests in MOL.com. Their direct and indirect interests in MOL.com as at 30 August 2013 are set out as follows:- % of Interest Direct Indirect TSVT (a) BCorporation Nil (b) Notes:- (a) (b) Deemed interested by virtue of his interest in BCorporation. Deemed interested by virtue of its 100% interest in BHills and its deemed interests in Berjaya Sompo Insurance Berhad and Prime Credit Leasing Sdn Bhd. DRTYC is the Chairman and a shareholder of MOL.com. (9) TSVT and DRTYC are Directors and Major Shareholders of Ascot Sports by virtue of their direct interests of 70% and 30% in Ascot Sports respectively. RTYS, a Director of Ascot Sports is a son of TSVT and a brother of DRTYC. 2.4 Methods Or Procedures On Which Transactions Prices Are Determined/Review Procedures For Recurrent Related Party Transactions The BToto Group has established various methods and procedures to ensure that Recurrent Related Party Transactions are entered into on an arm s length basis and on normal commercial terms which are consistent with the Group s normal business practices and policies and are on terms not more favourable to the Related Parties than those extended to third parties and are not detrimental to the minority shareholders. They include, inter-alia, the following:- (i) (ii) (iii) (iv) The transaction prices are based on prevailing market rates/prices that are agreed upon under similar commercial terms for transactions with third parties, business practices and policies and on terms which are generally in line with industry norms; The Related Parties and interested Directors will be notified of the method and/or procedures of the BToto Group; Records of Recurrent Related Party Transactions will be retained and compiled by the Group accountant for submission to the auditors and Audit Committee for review; Auditors shall review Recurrent Related Party Transactions as part of their audit programme and report findings to the Audit Committee; 12

21 (v) (vi) (vii) The Audit Committee is to provide a statement that it has reviewed the terms of the Recurrent Related Party Transactions to ensure that such transactions are undertaken based on terms not more favourable to the Related Parties than those generally available to the public, are not detrimental to the minority shareholders and are in the best interest of the BToto Group; Directors who have any interest in any Recurrent Related Party Transaction shall abstain from Board deliberations and voting and will ensure that they and any Person(s) Connected with them will also abstain from voting on the resolution at the EGM or AGM to be convened for the purpose; and Disclosures will be made in the annual report of the breakdown of the aggregate value of Recurrent Related Party Transactions during the financial year, amongst others, based on the following information:- (a) (b) the type of the Recurrent Related Party Transactions made; and the names of the Related Parties involved in each type of the Recurrent Related Party Transactions made and their relationship with the BToto Group. At least 2 other contemporaneous transactions with unrelated third parties for similar products/services and/or quantities will be used as comparison, wherever possible, to determine whether the price and terms offered to/by the Related Parties are fair and reasonable and comparable to those offered to/by other unrelated third parties for the same or substantially similar type of products/services and/or quantities. Where quotation or comparative pricing from unrelated third parties cannot be obtained, the transaction price will be determined by the BToto Group based on those offered by/to other unrelated parties for the same or substantially similar type of transaction to ensure that the Recurrent Related Party Transaction is not detrimental to the BToto Group. Pursuant to Paragraph 10.09(1)(a) of the Listing Requirements, BToto must immediately announce a Recurrent Related Party Transaction where:- (i) (ii) the consideration, value of the assets, capital outlay or costs of the Recurrent Related Party Transaction is RM1 million or more; or the percentage ratio of such Recurrent Related Party Transaction is 1% or more, whichever is the higher. In addition, Paragraph 10.08(2) of the Listing Requirements states that where any one of the percentage ratios of a related party transaction is 5% or more, BToto must issue a circular to its shareholders, obtain specific shareholders approval of the transaction and appoint an independent adviser. Further, Paragraph 10.08(4) of the Listing Requirements states that where any one of the percentage ratios is 25% or more, in addition to the foregoing, BToto must appoint a main adviser. The guidelines for the relevant approving authority practised by the BToto Group in relation to Recurrent Related Party Transactions are as follows:- (i) (ii) (iii) Transactions below RM500,000 each in value, will be reviewed and approved by any one of the Executive Directors or such other senior executive(s) (not being a person connected to the Related Party) designated by the Audit Committee from time to time for such purpose, and tabled for review by the Audit Committee on a half yearly basis. Transactions equal to or exceeding RM500,000 each in value will be reviewed and approved by the Audit Committee. The Executive Director or other senior executives(s) designated by the Audit Committee from time to time for such purpose, and the Audit Committee, may, as he/it deems fit, 13

22 request for additional information pertaining to the transaction under review from independent sources or advisers, including the obtaining of valuations from independent valuers. 2.5 Statement By Audit Committee The Audit Committee of BToto has seen and reviewed the procedures mentioned in Section 2.4 above and is of the opinion that the abovementioned procedures are sufficient to ensure that Recurrent Related Party Transactions are carried out on terms not more favourable to the Related Parties than those generally available to the public and are not detrimental to the interests of the minority shareholders. The BToto Group has in place adequate procedures and processes to monitor, track and identify Recurrent Related Party Transactions in a timely and orderly manner. The Audit Committee of BToto conducts the review of these procedures and processes on a half yearly basis. 2.6 Existing Mandate On Recurrent Related Party Transactions Set out below is the actual value transacted of each Recurrent Related Party Transactions, from the date on which the existing mandate was obtained on 17 October 2012 up to 30 August 2013, being the latest practicable date before the printing of this Circular, together with its estimated value as disclosed in the Circular to Shareholders dated 25 September 2012:- BToto Group with the following Related Parties Nature of transactions undertaken by BToto and/or its unlisted subsidiary companies BCorporation and its unlisted subsidiary companies:- BCorporation Management fees paid by BToto for services rendered that include, interalia, the provision of finance, secretarial and general administrative services Actual value transacted from 17/10/12 to 30/8/13 (RM 000) Estimated value as disclosed in the Circular to Shareholders dated 25/9/12 (RM 000) Berjaya Registration Services Sdn Bhd Berjaya Higher Education Sdn Bhd Inter-Pacific Trading Sdn Bhd Berjaya Education Sdn Bhd Graphic Press Prime Credit Leasing Sdn Bhd Receipt of share registration services by BToto Rental income received by Magna Mahsuri for renting of office at part of Level 11, Berjaya Times Square, Jalan Imbi, Kuala Lumpur Purchase of stationery products by BToto, STMSB and STFSB Receipt of education and staff training services by BToto and STMSB Procurement of Toto betting slips printing services by STMSB Receipt of leasing and hire purchase facilities by STFSB ,837 2, ,450 16,

23 BToto Group with the following Related Parties Ambilan Imej Sdn Bhd Nature of transactions undertaken by BToto and/or its unlisted subsidiary companies Rental paid by BToto for renting of office at part of Level 12, Berjaya Times Square, Jalan Imbi, Kuala Lumpur Actual value transacted from 17/10/12 to 30/8/13 (RM 000) 1,708 Estimated value as disclosed in the Circular to Shareholders dated 25/9/12 (RM 000) 2,119 Rental paid by BToto for renting of office at part of Level 12, Berjaya Times Square, Jalan Imbi, Kuala Lumpur BHills Stephens Properties Sdn Bhd Kimia Suchi Marketing Sdn Bhd Rental income received by FEAB Properties for renting of service suites at No. PHA-03, Meranti Park Apartments, Jalan BTR 1/5, Bukit Tinggi Resort, Bukit Tinggi, Pahang Rental paid by BToto for renting of storage space at Lots 26E & F, Wisma Cosway, Jalan Raja Chulan, Kuala Lumpur Purchase of cleaning chemical products and toiletries by STFSB Total 16,672 22,790 BLand and/or its unlisted subsidiary companies:- Berjaya Guard Services Sdn Bhd Receipt of security guard services by STMSB 2,997 4,900 Berjaya Langkawi Beach Resort Sdn Bhd Rental paid by BToto for renting of villa at Berjaya Langkawi Resort, Burau Bay, Pulau Langkawi, Kedah Rental income received by FEAB Properties for renting of restaurant at Plot C, Teluk Burau, Padang Matsirat, Pulau Langkawi, Kedah Berjaya Air Sdn Bhd Dry lease charges paid by STMSB and/or the BToto Group for aircraft leasing facilities 1,250 1,500 Nada Embun Sdn Bhd Rental paid by:- 1. STMSB for renting of office at Lot 13-01, Level 13, Berjaya Times Square, Jalan Imbi, Kuala Lumpur 1,245 1, BToto for renting of office at part of Level 13, Berjaya Times Square, Jalan Imbi, Kuala Lumpur BToto for renting of office at part of Level 13, Berjaya Times Square, Jalan Imbi, Kuala Lumpur

24 BToto Group with the following Related Parties Berjaya Jet Charter Sdn Bhd Nature of transactions undertaken by BToto and/or its unlisted subsidiary companies Charter fees paid by the BToto Group for aircraft leasing facilities Actual value transacted from 17/10/12 to 30/8/13 (RM 000) Estimated value as disclosed in the Circular to Shareholders dated 25/9/12 (RM 000) 1,416 8,950 Nural Enterprise Sdn Bhd Rental paid by STMSB:- 1. For renting of apartments at Lots 5.3, 5.4 & 5.6, 5 th Floor, Podium Block, Plaza Berjaya, Jalan Imbi Kuala Lumpur For renting of apartment at Lot 10.4, 10 th Floor, Podium Block, Plaza Berjaya, Jalan Imbi Kuala Lumpur For renting of apartment at Lot 12.2, 12 th Floor, Podium Block, Plaza Berjaya, Jalan Imbi Kuala Lumpur Total 7,479 17,599 BAssets and/or its unlisted subsidiary companies:- Natural Avenue Sdn Bhd Supply of computerised lottery systems and related services by International Lottery & Totalizator Systems, Inc ,000 BTSSB BTS Car Park Sdn Bhd Rental paid by STCSB for renting of office at Lots 09-88, & 09-90, 9 th Floor, Berjaya Times Square, Jalan Imbi, Kuala Lumpur Parking charges paid by STMSB, BToto and STCSB Total 664 1,577 BMedia and/or its unlisted subsidiary company:- Sun Media Corporation Sdn Bhd Procurement of promotion, advertising and publishing services by the BToto Group 1,099 2,000 Other related parties:- Biofield Rental paid by STFSB for renting of shoplot at Lot 06-11, Level 6, Berjaya Times Square, Jalan Imbi, Kuala Lumpur Roda Indah U Mobile Purchase of motor vehicles, component parts and other related products and services by STMSB Rental income received by Magna Mahsuri for renting of office at part of Level 11, Berjaya Times Square, Jalan Imbi, Kuala Lumpur 174 2, ,310 16

25 BToto Group with the following Related Parties Qinetics Ascot Sports Auto Tulin Nature of transactions undertaken by BToto and/or its unlisted subsidiary companies Purchase of hardware, software and networking equipment, and information technology consultancy, data storage, maintenance and management services by the BToto Group Rental paid by STMSB for renting of office at part of Lot 10-01, Level 10, Berjaya Times Square, Jalan Imbi, Kuala Lumpur. Purchase of motor vehicles, component parts and other related products and services by STMSB Actual value transacted from 17/10/12 to 30/8/13 (RM 000) Estimated value as disclosed in the Circular to Shareholders dated 25/9/12 (RM 000) 1,595 2, ,300 Total 3,922 8,303 Grand Total 29,836 52, Amount Due And Owing By Related Parties Pursuant To Recurrent Related Party Transactions As at 30 April 2013, the total outstanding amount of RM1.1 million owed by a Related Party to the BToto Group did not exceed 1 year. The management monitors and reviews the outstanding amount on a regular basis and follow up on the status of the case. Appropriate actions such as discussions with the Related Party for early settlement of outstanding amount are taken to recover the outstanding amount. The management is of the opinion that there is no recoverability issue as there is no long overdue amount from Related Party who is of sound credit standing. Late payment charges are not imposed on amount owed by the Related Party as this is trade in nature. 3.0 RATIONALE FOR, AND THE BENEFIT TO THE BTOTO GROUP FROM TRANSACTING WITH RELATED PARTIES 3.1 The Recurrent Related Party Transactions entered into or to be entered into by the BToto Group are all in the ordinary course of business and intended to meet the business needs of the Group at the best possible terms so as to achieve the synergistic benefits within the entire BToto Group. As such, it is anticipated that the Recurrent Related Party Transactions would occur on a frequent and recurrent basis. 3.2 The Proposed Mandate will eliminate the need to make announcements to the Exchange and/or to convene separate EGMs from time to time to seek shareholders prior approvals for the BToto Group to enter into such Recurrent Related Party Transactions. This will serve to reduce substantial administrative time and expenses in convening such EGMs without compromising the corporate objectives of the Group or affecting the business opportunities available to the Group. 3.3 The Recurrent Related Party Transactions provide the BToto Group the support for its operational and business needs and further enhance its ability to explore beneficial business opportunities and also to maximise the utilisation of human resources within the BToto Group and the Related Parties. 17

26 4.0 CONDITIONS FOR THE PROPOSED MANDATE 4.1 The Proposed Mandate is conditional upon approval being obtained from shareholders of BToto at the forthcoming AGM. The Proposed Mandate being procured from shareholders of BToto at the forthcoming AGM is subject to annual renewal. 5.0 FINANCIAL EFFECTS OF THE PROPOSED MANDATE 5.1 The Proposed Mandate does not have any effect on the issued and paid-up share capital of BToto and is not expected to have any material effect on the consolidated earnings and NA of BToto. 6.0 DIRECTORS AND MAJOR SHAREHOLDERS INTERESTS 6.1 The direct and indirect shareholdings of the interested Major Shareholders and the interested Directors and Persons Connected with them in BToto as at 30 August 2013 are as follows: Direct Indirect No. of Shares % No. of Shares % Interested Major Shareholders TSVT 9,670, ,609,858 (a) BCorporation 27,732, ,668,789 (b) BLand 188,997, ,467,431 (c) Interested Directors DRTYC 846, DDTYL Interested Persons Connected DRTYC 846, RTYS (e) DDTYL TSDT 4,811, ,000 (d) 0.05 Notes:- (a) (b) (c) (d) (e) Deemed interested by virtue of his interests in BCorporation, B&B and his deemed interest in Premier Merchandise. Deemed interested by virtue of its 100% interest in BGroup. Deemed interested by virtue of its 100% interests in Gateway Benefit Sdn Bhd, Immediate Capital Sdn Bhd, and B.L. Capital Sdn Bhd. Indirect interest held through spouse. RTYS had on 1 October 2012 resigned as the Executive Director of BToto and ceased as a shareholder of BToto on 20 February Based on details as disclosed in Section 2.3 above, DRTYC and DDTYL, being interested Director have abstained and will continue to abstain from all Board deliberations and voting in relation to the Proposed Mandate. They will abstain from voting in respect of their, direct and/or indirect shareholdings in BToto (where applicable) on the ordinary resolution approving the Proposed Mandate at the forthcoming AGM. 6.3 TSVT, BCorporation and BLand being interested Major Shareholders, will abstain from voting in respect of their direct and/or indirect shareholdings on the ordinary resolution approving the Proposed Mandate at the forthcoming AGM. 18

27 6.4 TSVT, DRTYC, DDTYL, BCorporation and BLand have undertaken to ensure that Persons Connected with them will abstain from voting on the ordinary resolution, deliberating or approving the Proposed Mandate at the forthcoming AGM. 6.5 Save as disclosed, none of the other Directors or Major Shareholders and Persons Connected with them, has any interest, direct or indirect in the Proposed Mandate. 7.0 DIRECTORS RECOMMENDATION 7.1 The Board of BToto (except for DRTYC and DDTYL) having considered all aspects of the Proposed Mandate, is of the opinion that it is in the best interest of the BToto Group and accordingly the Board with the exception of DRTYC and DDTYL who have abstained from making any recommendation on the Proposed Mandate, recommends that you vote in favour of the Proposed Mandate to be tabled at the forthcoming AGM. 8.0 AGM 8.1 The AGM, Notice of which is enclosed in the Annual Report 2013 and an extract of ordinary resolution on the Proposed Mandate is enclosed in this Circular, will be held at Dewan Berjaya, Bukit Kiara Equestrian & Country Resort, Jalan Bukit Kiara, Off Jalan Damansara, Kuala Lumpur on Friday, 18 October 2013 at a.m. for the purpose of considering and, if thought fit, passing the ordinary resolution to give effect to the Proposed Mandate. 8.2 If you are unable to attend and vote in person at the forthcoming AGM, you are requested to complete and return the enclosed Form of Proxy in the Annual Report 2013 in accordance with the instructions therein as soon as possible so as to arrive at the Registered Office of the Company at Lot 13-01A, Level 13 (East Wing), Berjaya Times Square, No.1 Jalan Imbi, Kuala Lumpur not less than 48 hours before the time set for the AGM. The completion and the return of the Form of Proxy will not preclude you from attending and voting in person at the forthcoming AGM should you subsequently wish to do so. 9.0 FURTHER INFORMATION 9.1 Shareholders are requested to refer to the attached Appendix II for further information. Yours faithfully For and on behalf of the Board of Directors of BERJAYA SPORTS TOTO BERHAD Cheah Tek Kuang Chairman 19