Bursa Announcement

Reference is made to the Company’s announcements on 3 March 2021, 30 March 2021, 22 October 2021 and 12 May 2022 pertaining to the legal suit received from Betanaz Properties Sdn. Bhd. [Company No. 201201025590 (1010080-V)] (“the Plaintiff”) in the High Court of Malaya in Kuala Lumpur.

With regards to the Company’s announcement on 30 March 2021 whereby the Company, as the plaintiff, had announced the filing of a counterclaim against Betanaz Properties Sdn. Bhd. (“Betanaz”) as the first defendant, and Ahmad Zaki Resources Berhad [Company No. 199701017271 (432768-X)] (“AZRB”) as the second defendant (“Main Suit”), the Company had subsequently received an application by AZRB to strike out the Company’s counterclaim against AZRB.

In furtherance to the Company’s announcement on 22 October 2021, the High Court judge had allowed AZRB’s application to strike out the Company’s counterclaim against AZRB on the basis that the bridge across the Kuantan River, connecting Bandar Kuantan to Bandar Putra, Tanjung Lumpur (“Bridge”) was completed and the Company’s counterclaim is not sustainable. Upon the advice of the Company’s legal counsel, the Company filed an appeal against the decision of the High Court to allow AZRB’s application to strike out the Company’s counterclaim against AZRB on 29 March 2021, on the basis that the Bridge was not completed on or before the expiry of the condition precedent period of the Tenancy Agreement dated 24 August 2017 and the Commercial Agreement dated 24 August 2017.

Subsequently on the 9 May 2022, pursuant to the Company’s appeal against the High Court’s decision to allow AZRB’s application to strike out the Company’s counterclaim against AZRB, the Court of Appeal has decided in favor of the Company and subsequently, AZRB will be reinstated as a party to the Company’s counterclaim as the second defendant in the trial for the Main Suit.

The Company wishes to announce that on 16 December 2024, the Learned High Court Judge decided, inter alia, that Company had breached the Tenancy Agreement by failing to honor its part of the bargain and being liable for the monthly rental payable to Betanaz. However, since there was an absence of compelling evidence to prove that the Company was bound to the 10 years Lease (Lease Annexure annexed to the Tenancy Agreement dated 24 August 2017), Betanaz’s claim was disallowed as it would be grossly unfair and unjust. Therefore, the High Court decision is as follows:-

1.  for the Civil Suit WA-22NCVC-121-03/2021:-

     a)  The claim on judgement sum of RM59,302,302.97 was not allowed;

     b)  The claim on the final judgement for RM18,678,255.27 against the Company was allowed.

     c)  Interest at the rate of 5% per annum on the sum of RM18,678,255.27 is allowed from 1 March 2021 until the full payment is paid;

     d)  Costs of RM200,000.00 is to be paid by the Company to Betanaz within 45 days from 16 December 2024;

     e)  Costs of RM100,000.00 is to be paid by the Company to AZRB within 45 days from 16 December 2024;

     f)   The Company’s counterclaim against Betanaz and AZRB was dismissed;

2. For the Civil Suit WA-24NCvC-1254-07/2021, the Company’s originating summons against Betanaz was dismissed and a date for assessment of damages (arising from the ex-parte injunction order dated 9 February 2021 against Betanaz) will be fixed.

The Company has been advised by its legal counsel and will be appealing against the High Court decision dated 16 December 2024 and also applying for a stay of execution of the said High Court decision.

At this juncture, the Board is unable to ascertain the financial impact to the Company pending the outcome of the legal suit. If there is any further updates or development on the above suit, further announcement will be made in due course.

This announcement is dated 18 December 2024.