THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to the action you should take, you should consult your stockbroker, bank manager, solicitor, accountant or other professional adviser immediately. Bursa Malaysia Securities Berhad has not perused through the contents of this Circular and takes no responsibility for the contents of this Circular, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this Circular. SUPERCOMNET TECHNOLOGIES BERHAD (Company No. 197527-H) (Incorporated in Malaysia) CIRCULAR TO SHAREHOLDERS IN RELATION TO PROPOSED RENEWAL OF THE SHAREHOLDERS MANDATE AND PROPOSED NEW SHAREHOLDERS' MANDATE FOR RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE The Notice convening the Extraordinary General Meeting of SUPERCOMNET TECHNOLOGIES BERHAD ( STB ) to be held at the Kenari Hall, Cinta Sayang Resort, Persiaran Cinta Sayang, 08000 Sungai Petani, Kedah on Friday, May 27, 2016 at 10.00 a.m. or immediately following the conclusion or adjournment of the Twenty-Sixth Annual General Meeting to be held on May 27, 2016, whichever is earlier, together with the Form of Proxy are enclosed herein. A member entitled to attend and vote at the meeting is entitled to appoint a proxy to vote for and on his/her behalf. In such event, the Form of Proxy should be lodged at the Registered Office of STB at 57-G Persiaran Bayan Indah, Bayan Bay, Sungai Nibong, 11900 Penang, on or before the date and time indicated below or any adjournment thereof. The lodging of the Form of Proxy will not preclude you from attending and voting in person at the meeting should you subsequently wish to do so. Last day and time for lodging the Form of Proxy... : Wednesday, May 25, 2016 at 9.30 a.m. Date and time of the Extraordinary General Meeting.. : Friday, May 27, 2016 at 10.00 a.m. or immediately following the conclusion or adjournment of the Twenty-Sixth Annual General Meeting to be held on May 27, 2016 whichever is earlier This Circular is dated April 29, 2016
DEFINITIONS Except where the context otherwise requires, the following definitions shall apply throughout this Circular: Act : Malaysian Companies Act, 1965, as amended from time to time and any re-enactment thereof. AGM : Twenty-Sixth Annual General Meeting Board : The Board of Directors of STB Bursa Securities : Bursa Malaysia Securities Berhad (635998-W) CMSA : Capital Markets and Services Act 2007 and any amendment thereto that may be made from time to time. Company or STB : Supercomnet Technologies Berhad (197527-H) Directors : The Directors for the time being of the Company and shall have the same meaning given in Section 2 (1) of the CMSA and includes any person who is or was within the preceding 6 months of the date on which the terms of the transaction were agreed upon, a director of the Company, its subsidiary or holding company or Chief Executive of the Company, its subsidiary or holding company. EGM : Extraordinary General Meeting Listing Requirements : Bursa Securities ACE Market Listing Requirements and any amendment thereto that may be made from time to time. LPD : March 31, 2016, being the latest practicable date prior to the printing of this Circular. Major Shareholder : Any person who is or was within the preceding 6 months of the date on which the terms of the transaction were agreed upon, who has an interest or interests in one or more voting shares in the Company or any other corporation which is its subsidiary or holding company 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 the Company; or 5% or more of the aggregate of the nominal amounts of all the voting shares in the Company where such person is the largest shareholder of the corporation. For the purpose of this definition, interest in shares has the meaning given in Section 6A of the Act. Ordinary Shares : Ordinary Shares of RM0.10 each in the Company
DEFINITIONS (CONT'D) Person Connected : In relation to a Director or a Major Shareholder, means such person who falls under any one of the following categories: (a) a family member of the Director or Major Shareholder, which family means such person falls within any one of the following categories: (i) (ii) (iii) (iv) (v) spouse; parent; child including an adopted child and step-child; brother or sister; and spouse of the person referred to in (iii) and (iv) above. (b) (c) 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; a partner of the Director, Major Shareholder or a partner of a person connected with that Director or Major Shareholder; partner means such person who falls within any one of the following categories: (i) (ii) a person with whom the Director, Major Shareholder or person connected with the Director or Major Shareholder, is in or proposes to enter into partnership with. Partnership for this purpose refer to a partnership as defined in Section 3 of the Partnership Act 1961 or limited liability partnership as defined in Section 2 of the Limited Liability Partnerships Act 2012, as the case may be; or a person with whom the Director, Major Shareholder or person connected with a Director or Major Shareholder has entered or proposes to enter into a joint venture, whether incorporated or not. (d) (e) (f) (g) (h) (i) a person who is accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the Director or Major Shareholder; a person in accordance with whose directions, instructions or wishes the Director or Major Shareholder is accustomed or is under an obligation, whether formal or informal, to act; a body corporate or its directors which/who is/are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the Director or Major Shareholder; a body corporate or its directors whose directions, instructions or wishes the Director or Major Shareholder is accustomed or under an obligation, whether formal or informal, to act; a body corporate in which the Director, Major Shareholder or persons connected with him are entitled to exercise, or control the exercise of, not less than 15% of the votes attached to voting shares in the body corporate; or a body corporate which is a related corporation.
DEFINITIONS (CONT'D) Proposed Renewal of Shareholders Mandate : Proposed Renewal of Shareholders Mandate pursuant to Rule 10.09 of the Listing Requirements for the RRPT to be entered into for the period from this EGM to the next AGM as set out in Section 2.3.1 of this Circular. Proposed New Shareholders Mandate : Proposed New Shareholders Mandate pursuant to paragraph 10.09 of the Bursa Securities Listing Requirements for the RRPT to be entered into for the period from this EGM to the next AGM as set out in Section 2.3.2 of this Circular. Proposed Shareholders Mandate : The Proposed New Shareholders Mandate and Proposed Renewal of Shareholders Mandate, collectively. Recurrent Related Party Transaction or RRPT : A transaction which is a Related Party Transaction of a revenue or trading nature and which are necessary for the day-to-day operations of the Company and/or the subsidiary of the Company in the ordinary course of business and are on terms not more favourable to the Related Party than those generally available to the public. Related Party : A Director, Major Shareholder or person connected with such Director or Major Shareholder. Related Party Transaction or RPT : A transaction entered into by the Company or its subsidiary which involve the interest, direct or indirect, of a Related Party. RM : Ringgit Malaysia SAC : Supercomal Advanced Cables Sdn. Bhd. (405437-H) SMP : Supercomal Medical Products Sdn. Bhd. (666895-K), an associated company of STB where STB has a 20% shareholding. STB Group : STB and its subsidiary company Words denoting the singular shall, where applicable, include the plural and vice versa. Words denoting masculine gender shall, where applicable, include the feminine and neuter genders and vice versa. Reference to persons shall include corporations. Any reference to a time of day shall be a reference to Malaysian time, unless otherwise stated. THE REMAINING OF THIS PAGE IS INTENTIONALLY LEFT BLANK
TABLE OF CONTENTS Page DIRECTORS LETTER TO SHAREHOLDERS OF STB CONTAINING: 1. INTRODUCTION... 1 2. DETAILS OF THE PROPOSED SHAREHOLDERS MANDATE... 2 2.1 Proposed Shareholders Mandate... 2 2.2 The RRPT with whom the transaction will be carried out... 3 2.3 Nature of RRPT covered under the Shareholders Mandate... 3 2.4 Outstanding RRPT Receivables....... 5 2.5 Threshold of authority........ 5 2.6 Review procedures of the RRPT... 5 2.7 Rationale for and Benefits of the Proposed Shareholders Mandate... 6 2.8 Audit Committee Statement... 7 3. VALIDITY PERIOD OF THE PROPOSAL.... 7 4. DISCLOSURE IN ANNUAL REPORT... 7 5. APPROVAL REQUIRED... 8 6. INTERESTS OF DIRECTORS, MAJOR SHAREHOLDERS AND/OR PERSON(S) CONNECTED TO THEM... 8 7. DIRECTORS RECOMMENDATION... 9 8. EGM... 9 9. FURTHER INFORMATION... 9 APPENDIX A FURTHER INFORMATION... 10 NOTICE OF EGM... 11 PROXY FORM OF EGM...ENCLOSED NOTICE OF AGM...ENCLOSED PROXY FORM OF AGM...ENCLOSED REQUEST FORM FOR ANNUAL REPORT IN HARD COPY...ENCLOSED THE REMAINING OF THIS PAGE IS INTENTIONALLY LEFT BLANK
SUPERCOMNET TECHNOLOGIES BERHAD (Company No. 197527-H) (Incorporated in Malaysia) Registered Office:- 57-G Persiaran Bayan Indah Bayan Bay Sungai Nibong 11900 Penang April 29, 2016 DIRECTORS:- Ng Ngoon Weng ( Independent Non-Executive Chairman) Shiue, Jong-Zone (Managing Director) Wu, Huei-Chung (Executive Director) Hsueh, Chih-Yu (Executive Director) Wu, Chung-Jung (Non Independent Non-Executive Director) Goh Chooi Eam (Independent Non-Executive Director) TO: THE SHAREHOLDERS OF SUPERCOMNET TECHNOLOGIES BERHAD Dear Sir/Madam, PROPOSED RENEWAL OF THE SHAREHOLDERS MANDATE AND PROPOSED NEW SHAREHOLDERS MANDATE FOR RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE [HEREINAFTER KNOWN AS PROPOSED SHAREHOLDERS MANDATE ] 1. INTRODUCTION At the EGM of STB held on June 23, 2015, the Company had obtained its shareholders approval for the renewal of the existing shareholders mandate and proposed new shareholders mandate for recurrent related party transactions of a revenue or trading nature which were necessary for the day-to-day operations and were in the ordinary course of business of STB Group. The abovementioned shareholders mandate shall, in accordance with the Listing Requirements, expire at the conclusion of the forthcoming AGM, which will be held on May 27, 2016. On April 12, 2016 the Board of the Company announced the Company s intention to seek shareholders approval for the Proposed Shareholders Mandate at the forthcoming EGM. The purpose of this Circular is to provide the shareholders with the information on Proposed Shareholders Mandate, to set out the Board s recommendation thereon and to seek the Shareholders approval for the Ordinary Resolution to be tabled at the forthcoming EGM. The notice of EGM together with the Form of Proxy is enclosed in this Circular. SHAREHOLDERS OF STB ARE ADVISED TO READ THE CONTENTS AND THE APPENDICES OF THIS CIRCULAR, AND TO CONSIDER CAREFULLY THE DIRECTORS RECOMMENDATION BEFORE VOTING ON THE RESOLUTION TO GIVE EFFECT TO THE PROPOSED SHAREHOLDERS MANDATE. 1
2. DETAILS OF THE PROPOSED SHAREHOLDERS MANDATE 2.1 Proposed Shareholders Mandate Pursuant to Rule 10.09 (2) and Guidance Note 8 of the Listing Requirements, STB may seek a shareholders mandate, a mandate which is subject to annual renewal, with regard to RPT involving recurrent transactions of a revenue or trading nature which are necessary for its day-to-day operations subject to, inter-alia, the following:- (a) (b) The transactions are carried out 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 the 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:- (i) (ii) the consideration, value of the assets, capital outlay or costs of the aggregated transactions is equal to or exceeds RM1 million; or any one of the percentage ratios of such aggregated transactions is equal to or exceeds 1%. whichever is the lower. (c) (d) (e) The circular to shareholders for the shareholders mandate includes the information as may be prescribed by Bursa Securities; In a meeting to obtain a 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; The Company immediately announces to Bursa Securities when the actual value of a RRPT entered into by the Group, exceeds the estimated value of the RRPT disclosed in the circular by 10% or more and must include the information as may be prescribed by Bursa Securities in its announcement. In this regard, the Company proposes to seek its shareholders approval for the Proposed Shareholders Mandate as detailed in Section 2.3 of this Circular at the EGM to be held on May 27, 2016, to enable the Company and/or its subsidiary to enter into RRPT with the Related Parties, which are necessary for the day-to-day operations of the STB Group and are based on normal commercial terms that are not more favourable to the Related Parties than those generally available to the public. THE REMAINING OF THIS PAGE IS INTENTIONALLY LEFT BLANK 2
2. DETAILS OF THE PROPOSED SHAREHOLDERS MANDATE (cont'd) 2.2 The RRPT with whom the transaction will be carried out The Company is principally a manufacturer of PVC compound and cables/wires for electronic devices and data control switches and the principal activities of its subsidiary and associated company are as follows:- Company Date / Place of Incorporation SAC 10.10.1996; Malaysia Equity Interest (%) Principal Activity 100.00 The Company is principally involved in the manufacture of wires and cables for automotive industries. SMP 23.09.2004; Malaysia 20.00 The Company is mainly manufactures of cables for medical devices. STB would, in the ordinary course of business, enter into the RRPT and it is likely that such transactions will occur with some degree of frequency and could arise at any time. 2.3 Nature of RRPT covered under the Proposed Shareholders Mandate The details of the RRPT and their estimated value to be entered into during the Proposed Mandate Period would be as below. It is anticipated that the Group would, in the ordinary course of business, enter into the categories of RPT with classes of Related Party as set out below:- 2.3.1 Nature of RRPT covered under the Proposed Renewal of Shareholders Mandate No. Related Parties Nature of Transactions Estimated value of preceding year s Mandate # (RM) Actual value transaction as at LPD (RM) Estimated Value @ (RM) Interested Related Party 1. STB (Landlord) SMP (Tenant) Monthly Rental of factory space at Lot 172, Jalan PKNK 3/8, Kawasan Perusanaan Sungai Petani, 08000 Sungai Petani, Kedah measuring 17,983 sq feet 400,000.00 105,320.25 400,000.00 Mr. Shiue, Jong-Zone (SJZ), Mdm. Wu, Huei-Chung (WHC) and Hsueh, Chih-Yu (HCY) are Directors and Major Shareholders of both STB and SMP. Mr. Wu, Chung-Jung (WCJ), the brother-in-law of SJZ and brother of WHC, being a related party, is a Director and Major Shareholder of both STB and SMP. Mr. Shiue, Jyh-Jeh, the son of SJZ and WHC, brother of HCY and nephew of WCJ, being a related party, is a Director and Major Shareholder of SMP. He is also a Major Shareholder of STB. 2. STB (Seller) SMP (Buyer) Sales of finished goods by STB to SMP 7,200,000.00 4,019,589.00 7,200,000.00 Same as above 3
2. DETAILS OF THE PROPOSED SHAREHOLDERS MANDATE (cont'd) 2.3 Nature of RRPT covered under the Proposed Shareholders Mandate (cont'd) 2.3.1 Nature of RRPT covered under the Proposed Renewal of Shareholders Mandate (cont'd) No. Related Parties Nature of Transactions Estimated value of preceding year s Mandate # (RM) Actual value transaction as at LPD (RM) Estimated Value @ (RM) Interested Related Party 3. SAC (Landlord) SMP (Tenant) Monthly Rental of factory space at Lot 171, Jalan PKNK 3/8, Kawasan Perusanaan Sungai Petani, 08000 Sungai Petani, Kedah measuring 25,833 sq feet 400,000.00-400,000.00 Same as above 4. SAC (Provider) SMP (Recipient) Subcontracting of labour works 400,000.00-400,000.00 Same as above 2.3.2 Nature of RRPT covered under the Proposed New Shareholders Mandate No. Related Parties Nature of Transactions Estimated Value @ (RM) Interested Related Party 1. STB (Owner) SMP (Tenant) Monthly Rental of following Machineries located at Lot 172, Jalan PKNK 3/8, Kawasan Perusanaan Sungai Petani, 08000 Sungai Petani, Kedah:- - Moulding Machine - Crimping Machine - Cable Testing Machine - Wire Striping and Stranding Machine - Payoff Machine - Double Twist Stranding Machine - Twister Machine - Cutting Off Machine 100,000.00 Mr. Shiue, Jong-Zone (SJZ), Mdm. Wu, Huei-Chung (WHC) and Hsueh, Chih-Yu (HCY) are Directors and Major Shareholders of both STB and SMP. Mr. Wu, Chung-Jung (WCJ), the brotherin-law of SJZ and brother of WHC, being a related party, is a Director and Major Shareholder of both STB and SMP. Mr. Shiue, Jyh-Jeh, the son of SJZ and WHC, brother of HCY and nephew of WCJ, being a related party, is a Director and Major Shareholder of SMP. He is also a Major Shareholder of STB. # Estimated value for the period from June 23, 2015 to June 30, 2016 which is tentative date of the 25th AGM. @ Estimated value for the Proposed Mandate Period [from the date of this EGM to the next AGM in year 2017]. The estimated value as set up above are based on management estimate of the last year s value of the transactions and this year s forecast. However, the value of the transactions may be subject to changes. 4
2. DETAILS OF THE PROPOSED SHAREHOLDERS MANDATE (cont'd) 2.4 Outstanding RRPT Receivables The breakdown of the principal sum for the total outstanding amount due under the RRPT which exceeded the credit term as at December 31, 2015 are as follows:- No. Nature of RRPT 1. Sales of finished goods by STB to SMP Amount of Outstanding RRPT Receivables (RM) 1 year > 1 year to 3 years > 3 year to 5 years > 5 years RM1,429,726.40 - - - There were no late payment charges and interest imposed on the above outstanding receivables as the said overdue receivables were trade in nature and also as a goodwill gesture and involving valued customer. The Company has following up with calls to the Finance Manager of the company to pursue for early settlement of the recurring outstanding amount due. The Board of Directors is of the opinion the overdue amount is closely monitored and optimistic that the amount will be recoverable. 2.5 Threshold of authority There is no specific threshold for approval of the RRPT within the STB Group. However, all RRPT are subject to the approval of the Senior Management i.e. reviewed by the Assistant Sales Manager and approved by the Factory Manager. Where any Director has any interest (direct or indirect) in any RRPT, such Director shall abstain from deliberation and voting on the matter. In the event that the guidelines and/or procedures stipulated in Section 2.6 of this Circular are confirmed inadequate, the Company will obtain a fresh shareholders mandate to ensure that: (a) (b) RRPT(s) will be conducted on an arms length basis and on normal commercial terms which are not more favourable to the Related Parties than those generally available to the public; and such transaction will not be detrimental to the minority shareholders of the Company or prejudicial to the interests of the shareholders. 2.6 Review procedures of the RRPT The Directors of the Company will ensure that the methods or procedures adopted for pricing a transaction with related parties are determined in accordance with the normal procedures and standards currently adopted by the Company in transactions with non-related parties conducted on an arms-length willing buyer and willing seller basis after taking into account prevailing market conditions and that such transactions are negotiated on the basis of prudent business practice to maximize profit margin or minimize costs and not to the detriment of the minority shareholders. All RRPT will be subject to periodic reviews by the Audit Committee to ensure that they have been transacted on arms length basis and on commercial terms not detrimental to the Company and that proper disclosures will be made in the annual report of the Company in respect of the aggregate value of transactions conducted pursuant to the shareholders mandate during the financial year. THE REMAINING OF THIS PAGE IS INTENTIONALLY LEFT BLANK 5
2. DETAILS OF THE PROPOSED SHAREHOLDERS MANDATE (cont'd) 2.6 Review procedures of the RRPT (cont'd) STB has implemented and will continue to implement the following procedures for RPT and the methods for which transaction prices are determined in order to ensure that RRPT will be undertaken on an arms length basis and on normal commercial terms and on terms not more favourable to the related party than those generally available to the public and are not to the detriment of the minority shareholders:- a. A list of Related Parties will be circulated within STB and each Related Party will be notified that all RRPT are required to be undertaken on arms length basis and on normal commercial terms and on terms not more favourable to the Related Parties than those generally available to the public; b. All RRPT to be entered into will be reviewed by Board of Directors to ensure that the transactions are not more favourable to the Related Parties and will not be detrimental to the minority shareholders; c. The cost plus method will be used to determine the transaction price. This method adds an appropriate mark-up to the cost of production and will best determine an arm s length price. The appropriate mark-up is the percentage earned by the Company on the RPT/ sales. At least two (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. In the event that quotation or comparative pricing from unrelated third parties cannot be obtained, to ensure that the RRPT is not detrimental to STB Group, the prices, terms and conditions of a transaction will be determined by the Group s usual business practice taking into considerations the demand and supply of the products; d. The annual internal audit plan shall incorporate a review of all RRPT entered and/or to be entered into pursuant to the shareholders mandate to ensure that the relevant approvals have been obtained and the review procedures in respect of such transactions are adhered to; e. Records will be maintained by the Company to capture all RRPT which are entered; f. The Board of Directors of the Company and the Audit Committee shall have overall responsibility for the determination of the review procedures with authority to sub-delegate such responsibilities to individuals or committees within the Company as they deem appropriate. If a member of the Board of Directors or Audit Committee has an interest in a transaction, as the case may be, he will abstain from any decision making by the Board of Directors or Audit Committee in respect of the said transaction; 2.7 Rationale for and Benefits of the Proposed Shareholders Mandate The rationale for and the benefits of the Shareholders Mandate to STB are as follows:- a. The Proposed Shareholders Mandate will facilitate transactions with Related Parties which are carried out in the ordinary course of business of STB and are made on an arms length basis and on terms not more favourable to the Related Parties than those generally available to the public and not in the Company s opinion, detrimental to the minority shareholders; b. The Proposed Shareholders Mandate will enhance STB s ability to pursue business opportunities which may be of time-sensitive in nature and it may not be practical to seek shareholders approval on a case-by-case basis before entering into such transactions; 6
2. DETAILS OF THE PROPOSED SHAREHOLDERS MANDATE (cont'd) 2.7 Rationale for and Benefits of the Proposed Shareholders Mandate (cont'd) c. The transactions between the Related Parties allow STB more efficient utilization of existing resources, prompt delivery and better bargaining power from reliable suppliers; and d. The obtaining of the shareholders mandate and renewal of the mandate on an annual basis would eliminate the need for the Company to make regular announcements or convene separate general meetings from time to time to seek shareholders approval as and when potential recurrent related parties transactions with a mandated related parties arise, thereby reducing the administrative time and expenses in convening such meetings, without compromising the corporate objectives and adversely affecting the business opportunities available to the Group. e. STB is utilizing its existing production capacity for production of medical usage wires and cables to SMP. With the estimated volume of sales, STB also enjoying economic of scale in its production. Thus, the Proposed Shareholders Mandate is expected to contribute positively towards the Group s revenue and profitability. 2.8 Audit Committee Statement The Audit Committee is of the view that:- a) the procedures adopted by STB are sufficient to continue ensuring that the RRPT are not more favourable to the related party than those generally available to the public and are not to the detriment of minority shareholders; and b) STB Group has in place adequate procedures and processes to monitor, track and identify the RRPT in a timely and orderly manner, and the frequency of review of these procedures and processes was carried out in quarterly basis. The Audit Committee has seen and reviewed the RRPT for the financial year ended December 31, 2015 and is of the views that the RRPT were conducted according to the procedures as set out in the Section 2.6 of the Circular to the Company s shareholders dated May 29, 2015 where the shareholders mandate was granted to the Company. 3. VALIDITY PERIOD OF THE PROPOSAL The Proposed Shareholders Mandate will take effect from the passing of the Ordinary Resolution at the EGM and the authority will continue to be in force until:- (i) (ii) (iii) the conclusion of the next AGM of the Company following the general meeting at which the Proposed Shareholders Mandate was passed, at which time it will lapse, unless by a resolution passed at the meeting, the authority for the Proposed Shareholders Mandate is renewed; the expiration of the period, within which the next AGM of the Company is required to be held pursuant to Section 143(1) of the Act (but will not extend to such extension as may be allowed pursuant to Section 143(2) of the Act); or revoked or varied by resolution passed by the shareholders in general meeting, whichever is the earlier. 4. DISCLOSURE IN ANNUAL REPORT The Company has disclosed in page 26 of the Annual Report 2015 of the Company the aggregate value of RRPT conducted pursuant to the shareholders mandate during the financial year ended December 31, 2015. 7
5. APPROVAL REQUIRED The Proposed Shareholders Mandate is subject to the approval from the shareholders of the Company at the forthcoming EGM. 6. INTERESTS OF DIRECTORS, MAJOR SHAREHOLDERS AND/OR PERSON(S) CONNECTED TO THEM As at LPD, the direct and indirect interests of those Directors, Major Shareholders of the Company and Person Connected to them (if any) who are interested in the Proposed Shareholders Mandate are as follows:- Interested Directors &/or Major Shareholders Direct No. of STB Shares % Indirect No. of STB Shares % Shiue, Jong-Zone* ~ 46,393,600 19.09 33,090,600 (a) 13.62 Wu, Chung-Jung^~ 26,837,200 11.04 52,647,000 (b) 21.67 Wu, Huei-Chung^~ 3,552,000 1.46 75,932,200 (c) 31.25 Hsueh, Chih-Yu ^~ 1,344,700 0.55 78,139,500 (d) 32.16 Shiue, Jyh-Jeh~ 1,356,700 0.56 78,127,500 (e) 32.15 Note: * Managing Director of STB ^ Director of STB ~ Director of SMP Deemed interest held through:- (a) (b) (c) (d) (e) Wu, Huei-Chung 3,552,000 3,552,000-3,552,000 3,552,000 Wu, Chung-Jung 26,837,200-26,837,200 26,837,200 26,837,200 Hsueh, Chih-Yu @ Shiue, Jyh-Yeu 1,344,700 1,344,700 1,344,700-1,344,700 Shiue, Jyh-Jeh 1,356,700 1,356,700 1,356,700 1,356,700 - Shiue, Jong-Zone - 46,393,600 46,393,600 46,393,600 46,393,600 The interested Directors namely, Shiue, Jong-Zone, Wu, Huei-Chung, Hsueh, Chih-Yu and Wu Chung- Jung have accordingly abstained and will continue to abstain from all Board deliberations and voting in respect of the relevant RRPT. The interested Major Shareholders namely Shiue, Jong-Zone, Wu, Huei-Chung, Wu Chung-Jung, Hsueh, Chih-Yu and Shiue, Jyh-Jeh, will abstain from voting pertaining to the Proposed Shareholders Mandate to be tabled at the forthcoming EGM in respect of his direct and/or indirect shareholdings. The Persons Connected to the Directors and Major Shareholders will abstain from voting pertaining to the Proposed Shareholders Mandate to be tabled at the forthcoming EGM in respect of their direct and/ or indirect shareholdings. The interested Directors and/or interested Major Shareholders namely, Shiue, Jong-Zone, Wu, Huei- Chung, Wu Chung-Jung, Hsueh, Chih-Yu and Shiue, Jyh-Jeh have undertaken to ensure that the Person Connected with them will abstain from voting, deliberating or approving the Proposed Shareholders Mandate to be tabled at the forthcoming EGM in respect of their direct/indirect shareholdings. Save as disclosed above, none of the Directors and/or Major Shareholders of the Company and/or Person Connected have any interest, direct or indirect, in the Proposed Shareholders Mandate. 8
7. DIRECTORS RECOMMENDATION 8. EGM The Board of Directors (save for the interested Directors disclosed above), having taken into consideration all aspects of the Proposed Shareholders Mandate, are of the opinion that the Proposed Shareholders Mandate is fair and reasonable and is in the best interest of the Company and its shareholders and therefore recommend (save for the interested Directors disclosed above) that you vote in favour of the Ordinary Resolutions in relation to the Proposed Shareholders Mandate to be tabled at the forthcoming EGM. The EGM, notice of which is enclosed in this Circular, will be held at the Kenari Hall, Cinta Sayang Resort, Persiaran Cinta Sayang, 08000 Sungai Petani, Kedah on Friday, May 27, 2016 at 10.00 a.m. or immediately following the conclusion or adjournment of the Twenty-Sixth AGM to be held on May 27, 2016, whichever is earlier for the purpose of considering and if thought fit, passing the resolution. If you are unable to attend and vote in person at the EGM, you are requested to complete, sign and return the Form of Proxy enclosed in this Circular in accordance with the instructions therein. The Form of Proxy must be deposited at the Registered Office of the Company at 57-G Persiaran Bayan Indah, Bayan Bay, Sungai Nibong, 11900 Penang not less than forty-eight (48) hours before the time stipulated for the EGM or any adjournment thereof. The completion and return of the Form of Proxy will not preclude you from attending and voting at the EGM in person should you subsequently wish to do so. The Form of Proxy should be completed strictly in accordance with the instructions contained therein. 9. FURTHER INFORMATION Shareholders are requested to refer to the attached Appendix A for further information. Yours faithfully, For and on behalf of the Board of Directors SUPERCOMNET TECHNOLOGIES BERHAD Ng Ngoon Weng Independent Non-Executive Chairman THE REMAINING OF THIS PAGE IS INTENTIONALLY LEFT BLANK 9
APPENDIX A FURTHER INFORMATION 1. Directors Responsibility This Circular has been seen and approved by the Directors of STB who collectively and individually accept full responsibility for the accuracy of the information given and confirm that after making all reasonable enquiries, to the best of their knowledge and belief, there are no other facts, the omission of which would make any statement herein misleading. 2. Material Contracts There are no material contracts (not being contracts entered into in the ordinary course of business) which have been entered into by the STB Group within the two (2) years immediately preceding the date of this Circular. 3. Material Litigation As at LPD, neither STB nor its subsidiary are engaged in any material litigation, claims and arbitration either as plaintiff or defendant and the Directors of STB have no knowledge of any proceedings pending or threatened against STB or its subsidiary or of any other facts likely to give rise to any proceedings which may materially and adversely affect the position or the business of STB or its subsidiary. 4. Documents Available for Inspection Copies of the following documents will be made available for inspection during normal office hours (except public holidays) at the registered office of STB from the date of this Circular up to and including the date of the EGM: (a) (b) Memorandum and Articles of Association of STB; and the audited consolidated financial statements of STB and its subsidiary company for the past two (2) financial years ended December 31, 2014 and December 31, 2015 respectively. THE REMAINING OF THIS PAGE IS INTENTIONALLY LEFT BLANK 10
SUPERCOMNET TECHNOLOGIES BERHAD (Company No. 197527-H) (Incorporated in Malaysia) NOTICE OF EXTRAORDINARY GENERAL MEETING NOTICE IS HEREBY GIVEN THAT an Extraordinary General Meeting of Supercomnet Technologies Berhad ( STB or the Company ) will be held at the Kenari Hall, Cinta Sayang Resort, Persiaran Cinta Sayang, 08000 Sungai Petani, Kedah on Friday, May 27, 2016 at 10.00 a.m. or immediately following the conclusion or adjournment of the Twenty-Sixth Annual General Meeting to be held on May 27, 2016, whichever is earlier for the purpose of considering and if thought fit, passing with or without modifications the following resolution:- ORDINARY RESOLUTION PROPOSED RENEWAL OF THE SHAREHOLDERS MANDATE AND PROPOSED NEW SHAREHOLDERS MANDATE FOR RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE That subject always to the provisions of the Companies Act, 1965 ( Act ), the Memorandum and Articles of Association of the Company, Bursa Malaysia Securities Berhad ACE Market Listing Requirements or other regulatory authorities, approval be and is hereby given to the Company and/or its subsidiaries to enter into category of RRPT as set out in Section 2.3 of the Circular to shareholders of the Company dated April 29, 2016 (the Circular ), which are necessary for the day to day operations and are carried out in the ordinary course of business and are on normal commercial terms which are not more favourable to the related parties than those generally available to the public and not detrimental to the minority shareholders as set out in the Circular ( Mandate ). That the Directors be empowered to do all such acts and things as considered necessary or expedient to give full effect to the Mandate with full powers to assent to any conditions, modifications, revaluations, variations and/or amendments as may be imposed by the relevant authorities. That such Mandate shall commence upon passing this ordinary resolution and to be in force until: a. the conclusion of the next annual general meeting of the Company, at which time it will lapse, unless by a resolution passed at the meeting, the authority is renewed; or b. the expiration of the period within which the next annual general meeting after that date is required to be held pursuant to Section 143(1) of the Companies Act, 1965 (the Act) (but will not extend to such extension as may be allowed pursuant to Section 143(2) of the Act); or c. revoked or varied by resolution passed by the shareholders in general meeting, whichever is the earlier. And that the Directors of the Company be and are hereby authorised to complete and to do all such acts and things (including executing all such documents as may be required) as they may consider expedient or necessary to give effect to the transactions contemplated and/or authorised by this ordinary resolution. By Order of the Board, HOW WEE LING (MAICSA 7033850) OOI EAN HOON (MAICSA 7057078) Secretaries Penang April 29, 2016 THE REMAINING OF THIS PAGE IS INTENTIONALLY LEFT BLANK 11
NOTES: For the purpose of determining a member who shall be entitled to attend and vote at the EGM, the Company shall be requesting the Record of Depositors as at May 19, 2016. Only a depositor whose name appears on the Record of Depositors as at May 19, 2016 shall be entitled to attend, speak and vote at the said meeting as well as for appointment of proxy(ies) to attend and vote on his/her stead. Proxy 1. A member entitled to attend and vote at the Meeting is entitled to appoint one or more proxies to attend and vote on a show of hands or on a poll in his stead. A proxy may but need not be a member of the Company and the provision of Section 149(1)(b) of the Companies Act, 1965 shall not apply to the Company. 2. Where a member of the Company is an Exempt Authorised Nominee which holds ordinary shares in the Company for multiple beneficial owners in one securities account ( omnibus account ), there is no limit to the number of proxies which the Exempt Authorised Nominee may appoint in respect of each omnibus account it holds. 3. Where a member appoints more than one (1) proxy, the appointments shall be invalid unless he specifies the proportion of his holdings to be represented by each proxy. 4. The instrument appointing a proxy shall be in writing under the hand of the appointor or his attorney duly authorised in writing or, if the appointor is a corporation, either under its common seal or under the hand of an officer or attorney duly authorised. 5. The instrument appointing a proxy must be deposited at the Registered Office of the Company at 57-G Persiaran Bayan Indah, Bayan Bay, Sungai Nibong, 11900 Penang not less than forty-eight (48) hours before the time set for holding of the Meeting i.e. Wednesday, May 25, 2016 at 9.30 a.m. or at any adjournment thereof. THE REMAINING OF THIS PAGE IS INTENTIONALLY LEFT BLANK 12
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SUPERCOMNET TECHNOLOGIES BERHAD (Company No. 197527-H) (Incorporated in Malaysia) PROXY FORM OF EGM No of ordinary shares held I/We (*NRIC No./Company No ) of being a *Member/Members of SUPERCOMNET TECHNOLOGIES BERHAD hereby appoint (Proxy 1) (*NRIC No./Passport No. ) of and*/or failing him* (Proxy 2) (*NRIC No./Passport No. ) of and*/or failing him*, the Chairman of the Meeting, as my/our proxy(ies), to vote for me/us on my/our behalf at the EXTRAORDINARY GENERAL MEETING of the Company to be held at Kenari Hall, Cinta Sayang Resort, Persiaran Cinta Sayang, 08000 Sungai Petani, Kedah on Friday, May 27, 2016 at 10.00 a.m. or immediately following the conclusion or adjournment of the Twenty-Sixth Annual General Meeting to be held on May 27, 2016, whichever is earlier and at any adjournment thereof. The proportions of my/our holdings to be represented by my/our proxy(ies) are as follows:- Proxy 1 - % In case of a vote by show of hands, Proxy 1*/Proxy 2* shall vote on my/our behalf. Proxy 2 - % 100% * Strike out whichever is inapplicable (Please indicate with an X in the space provided below on how you wish your vote to be cast. If you do not do so, the proxy will vote or abstain from voting at his discretion) Ordinary Resolutions For Against Proposed Renewal of the Shareholders Mandate and Proposed New Shareholder s Mandate for Recurrent Related Party Transactions of a Revenue or Trading Nature Signature of Shareholder(s) :.... Signed this:... day of.... 2016 Notes: For the purpose of determining a member who shall be entitled to attend and vote at the EGM, the Company shall be requesting the Record of Depositors as at May 19, 2016. Only a depositor whose name appears on the Record of Depositors as at May 19, 2016 shall be entitled to attend, speak and vote at the said meeting as well as for appointment of proxy(ies) to attend and vote on his/her stead. Proxy 1. A member entitled to attend and vote at the Meeting is entitled to appoint one or more proxies to attend and vote on a show of hands or on a poll in his stead. A proxy may but need not be a member of the Company and the provision of Section 149(1)(b) of the Companies Act, 1965 shall not apply to the Company. 2. Where a member of the Company is an Exempt Authorised Nominee which holds ordinary shares in the Company for multiple beneficial owners in one securities account ( omnibus account ), there is no limit to the number of proxies which the Exempt Authorised Nominee may appoint in respect of each omnibus account it holds. 3. Where a member appoints more than one (1) proxy, the appointments shall be invalid unless he specifies the proportion of his holdings to be represented by each proxy. 4. The instrument appointing a proxy shall be in writing under the hand of the appointor or his attorney duly authorised in writing or, if the appointor is a corporation, either under its common seal or under the hand of an officer or attorney duly authorised. 5. The instrument appointing a proxy must be deposited at the Registered Office of the Company at 57-G Persiaran Bayan Indah, Bayan Bay, Sungai Nibong, 11900 Penang not less than forty-eight (48) hours before the time set for holding of the Meeting i.e. Wednesday, May 25, 2016 at 9.30 a.m. or at any adjournment thereof.
Fold this flap for sealing Then fold here Affix stamp THE COMPANY SECRETARIES SUPERCOMNET TECHNOLOGIES BERHAD 57-G Persiaran Bayan Indah Bayan Bay, Sungai Nibong 11900 Penang 1st fold here
SUPERCOMNET TECHNOLOGIES BERHAD (Company No. 197527-H) (Incorporated in Malaysia) NOTICE OF ANNUAL GENERAL MEETING NOTICE IS HEREBY GIVEN that the Twenty-Sixth Annual General Meeting of the Company will be held at Kenari Hall, Cinta Sayang Resort, Persiaran Cinta Sayang, 08000 Sungai Petani, Kedah on Friday, May 27, 2016 at 9.30 a.m. for the following purposes:- A G E N D A 1. To receive the Audited Financial Statements for the financial year ended December 31, 2015 together with the reports of the Directors and Auditors thereon. 2. To declare a Single Tier Final Dividend of 0.4 Sen per share for the financial year ended December 31, 2015 3. To approve a Directors Fees of RM163,200/- for the financial year ended December 31, 2015 and payment of such fees to the Directors. 4. To approve an increase of Directors Fees from RM163,200/- to an amount up to RM172,720/- for the financial year ending December 31, 2016 and payment of such fees to the Directors. (Please refer to Note A) (Resolution 1) (Resolution 2) (Resolution 3) 5. To re-elect the following Directors who are retiring under Article 99(1) of the Articles of Association of the Company, and who, being eligible offered themselves for re-election:- a) Mr. Goh Chooi Eam (Resolution 4) b) Mr. Hsueh, Chih-Yu (Resolution 5) 6. To consider and if thought fit, to pass the following resolutions pursuant to Section 129 (6) of the Companies Act, 1965:- That the following Directors who are over seventy years of age, who retire in compliance with Section 129(2) of the Companies Act, 1965 be hereby re-appointed as Directors of the Company pursuant to Section 129(6) of the Companies Act, 1965 and to hold office until the conclusion of the next Annual General Meeting:- a) Mr. Wu, Chung-Jung (Resolution 6) b) Mr. Shiue, Jong-Zone (Resolution 7) 7. To re-appoint Messrs. Deloitte as Auditors of the Company for the ensuing year and to authorise the Directors to fix their remuneration. (Resolution 8) 8. AS SPECIAL BUSINESS To consider and, if thought fit, to pass the following Resolution:- Ordinary Resolution Authority to Issue Shares (Resolution 9) That pursuant to Section 132D of the Companies Act, 1965 and approvals from the Bursa Malaysia Securities Berhad ( Bursa Securities ) and other relevant governmental/ regulatory authorities where such authority shall be necessary, the Board of Directors be authorised to issue and allot shares in the Company from time to time until the conclusion of the next Annual General Meeting and upon such terms and conditions and for such purposes as the Board of Directors may, in its absolute discretion, deem fit provided that the aggregate number of shares to be issued shall not exceed ten per centum (10%) of the issued share capital of the Company for the time being, and that the Board of Directors be empowered to obtain the approval for the listing of and quotation for the additional shares so issued on the Bursa Securities. 9. To transact any other business of which due notice shall have been given in accordance with the Companies Act, 1965.
By Order of the Board HOW WEE LING (MAICSA 7033850) OOI EAN HOON (MAICSA 7057078) Secretaries Penang Date : April 29, 2016 Notes: A. This Agenda item is meant for discussion only as the provision of Section 169(1) of the Companies Act, 1965 and the Company s Articles of Association do not require a formal approval of the shareholders and hence, is not put forward for voting. 1. For the purpose of determining a member who shall be entitled to attend and vote at the AGM, the Company shall be requesting the Record of Depositors as at May 19, 2016. Only a depositor whose name appears on the Record of Depositors as at May 19, 2016 shall be entitled to attend, speak and vote at the said meeting as well as for appointment of proxy(ies) to attend and vote on his/her stead. 2. A member entitled to attend and vote at the Meeting is entitled to appoint one or more proxies to attend and vote on a show of hands or on a poll in his stead. A proxy may but need not be a member of the Company and the provision of Section 149(1)(b) of the Companies Act, 1965 shall not apply to the Company. 3. Where a member of the Company is an Exempt Authorised Nominee which holds ordinary shares in the Company for multiple beneficial owners in one securities account ( omnibus account ), there is no limit to the number of proxies which the Exempt Authorised Nominee may appoint in respect of each omnibus account it holds. 4. Where a member appoints more than one (1) proxy, the appointments shall be invalid unless he specifies the proportion of his holdings to be represented by each proxy. 5. The instrument appointing a proxy shall be in writing under the hand of the appointor or his attorney duly authorised in writing or, if the appointor is a corporation, either under its common seal or under the hand of an officer or attorney duly authorised. 6. The instrument appointing a proxy must be deposited at the Registered Office of the Company at 57-G Persiaran Bayan Indah, Bayan Bay, Sungai Nibong, 11900 Penang not less than forty-eight (48) hours before the time set for holding of the Meeting, i.e. by Wednesday, May 25, 2016 at 9.30 a.m. or at any adjournment thereof. Explanatory Note On Special Business: 1. Resolution pursuant to the Authority to issue Shares The proposed Resolution No. 9 [Item 8], if passed, will grant a renewed general mandate (Mandate 2016) and empower the Directors of the Company to issue and allot shares up to an amount not exceeding in total ten per centum (10%) of the issued share capital of the Company from time to time and for such purposes as the Directors consider would be in the interest of the Company. In order to avoid any delay and costs involved in convening a general meeting, it is thus appropriate to seek shareholders approval. This authority will, unless revoked or varied by the Company in general meeting, expire at the next Annual General Meeting of the Company. The Mandate 2016 will provide flexibility to the Company for allotment of shares for any possible fund raising activities, including but not limited for further placing of shares, for the purpose of funding future investment(s), acquisition(s) and/or working capital. As at the date of this Notice, the Company did not issue any shares pursuant to the mandate granted to the Directors at the Twenty-Fifth Annual General Meeting. The Company did not issue any share pursuant to the mandate granted because there was no investment, acquisition or working capital that required fund raising activity. THE REMAINING OF THIS PAGE IS INTENTIONALLY LEFT BLANK
SUPERCOMNET TECHNOLOGIES BERHAD (Company No. 197527-H) (Incorporated in Malaysia) NOTICE OF DIVIDEND ENTITLEMENT AND PAYMENT NOTICE IS HEREBY GIVEN that the Single Tier Final Dividend of 0.4 Sen per share for the financial year ended December 31, 2015, if approved, will be paid on July 8, 2016 to depositors registered in the Records of Depositors on June 9, 2016:- A Depositor shall qualify for entitlement to the Dividends in respect of: - a) shares transferred into the Depositor s Securities Account before 4.00 p.m. on June 9, 2016 in respect of ordinary transfers; b) shares bought on the Bursa Malaysia Securities Berhad ( Bursa Securities ) on a cum entitlement basis according to the rules of Bursa Securities. By Order of the Board HOW WEE LING (MAICSA 7033850) OOI EAN HOON (MAICSA 7057078) Secretaries Penang Date : April 29, 2016 THE REMAINING OF THIS PAGE IS INTENTIONALLY LEFT BLANK