THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. GROUP BERHAD. (Company No H) (Incorporated in Malaysia)

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1 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. You should rely on your own evaluation to assess the merits and risks of the proposal as set out herein. Bursa Malaysia Securities Berhad ( Bursa Securities ) 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 in this Circular. GROUP BERHAD (Company No H) (Incorporated in Malaysia) CIRCULAR TO SHAREHOLDERS IN RELATION TO THE PROPOSED LAND ACQUISITION BY SEACERA PROPERTIES SDN. BHD., A WHOLLY- OWNED SUBSIDIARY OF SEACERA GROUP BERHAD OF A FREEHOLD LAND MEASURING APPROXIMATELY ACRES IDENTIFIED AS PROVISIONAL PLOT NO. M.S. 269/1996/8A, M.S. 269/1996/10A AND M.S. 269/1996/11A FORMING PART OF A PIECE OF LAND HELD UNDER GERAN 23940, LOT 613, MUKIM ULU SEMENYIH, DISTRICT ULU LANGAT, NEGERI SELANGOR DARUL EHSAN FROM DUTA SKYLINE SDN. BHD. FOR A CASH CONSIDERATION OF RM78,130, AND NOTICE OF EXTRAORDINARY GENERAL MEETING The Notice of the Extraordinary General Meeting, to be held at Seacera Group Berhad, Lot 16428, 14 km, Jalan Ipoh, Kawasan Perindustrian Selayang, Batu Caves, Selangor on Wednesday, 29 August 2012 at a.m. or any adjournment thereof, together with the Form of Proxy, are enclosed in this Circular. The Form of Proxy should reach the registered office of the Company not less than forty-eight (48) hours before the time appointing for holding the meeting 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 date and time for lodging the Form of Proxy : Monday on 27 August 2012 at a.m. Date and time of the Extraordinary General Meeting : Wednesday on 29 August 2012 at a.m. This Circular is dated 14 August 2012

2 DEFINITIONS In this Circular and the accompanying appendices, the following abbreviations shall have the following meanings unless otherwise stated:- Act : Companies Act, 1965 as amended from time to time and any re-enactment thereof. Acquisition of 113 acres of Kajang Land Acquisition of Kamunting Land : As approved by the shareholders on 30 June 2009 of an acquisition by SPSB, a wholly-owned subsidiary of Seacera, of a piece of freehold land identified as Developer s Plot No. M.S. 269/1996/5A, M.S. 269/1996/6A and M.S. 269/1996/7A measuring approximately acres forming part of the Land held under Geran 23940, Lot 613, Mukim Ulu Semenyih, District Ulu Langat, Negeri Selangor Darul Ehsan from Duta Skyline Sdn. Bhd., for a total purchase consideration of RM26,750, (for definitions and further details, please refer to circular dated 5 June 2009) : As approved by the shareholders on 10 October 2011 of an acquisition by Seacera Porcelain Sdn. Bhd., a wholly-owned subsidiary of Seacera of a leasehold land measuring approximately acres located at Kamunting Raya Industrial Estates, Mukim Asam Kumbang, Daerah Larut & Matang, Perak Darul Ridzuan from the Perbadanan Kemajuan Negeri Perak for a purchase consideration of RM8,780, to be satisfied in part by cash and in part by issuance of 7,902,155 new ordinary shares of RM1.00 each in Seacera at an issue price of RM1.00 per Share (for definitions and further details, please refer to circular dated 23 September 2011) Articles : Articles of Association of Seacera BIMB : Bank Islam Malaysia Berhad (98127-X) Board : Board of Directors of Seacera Bursa Depository : Bursa Malaysia Depository Sdn. Bhd. ( W) Bursa Securities : Bursa Malaysia Securities Berhad ( W) Business Day : A day which is not a Saturday, Sunday or public holiday (whether or not gazetted or scheduled) in Kuala Lumpur or Selangor Darul Ehsan Chargees : Both Danaharta and BIMB Code : Malaysian Code on Take-Overs and Mergers 2010 Circular : This circular to the shareholders of Seacera dated 14 August 2012 Danaharta : Pengurusan Danaharta Nasional Berhad ( W) Directors : Shall have 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:- EGM : Extraordinary General Meeting EPS : Earnings per share (a) a Director of the Company, its subsidiary or holding company; or (b) a chief executive of the Company, its subsidiary or holding company. i

3 EPU : Economic Planning Unit of Malaysia FPE : Financial period ended FYE : Financial year ended Government : Government of Malaysia Individual Plot(s) : Plot 8A, Plot 10A and Plot 11A identified as each and any one of them JB or Valuer : Messrs JB Jurunilai Bersekutu Sdn. Bhd. ( W) (Board of Valuer s Registration No.: VE(1) 0161), an independent registered valuer JVA : A Joint Venture Agreement dated 5 April 2005 between the Vendor as the JV Partner and the Purchaser, both the Vendor and the Purchaser had agreed for the Purchaser to undertake the construction and development of a project on the Land provisionally known as Bandar Puncak Damai comprising residential and commercial units, upon the terms and subject to the conditions therein contained. The completion of the JVA is currently pending and was extended to 31 December 2012 JVA Payment : Payment made based on the terms and conditions of the JVA and as agreed by the JV Partner and the Purchaser. The nature of the payment is, not limited to, expenses incurred to keep the Land free from any legal implication such as quit rent, assessment, expenses incurred for development of the Land, such as, survey fees, infrastructure cost and other expenses deemed necessary to complete the terms and conditions of the JVA Land : A piece of freehold land measuring approximately acres in area known as Geran 23940, Lot 613, Mukim Ulu Semenyih, District Ulu Langat, Negeri Selangor Darul Ehsan Listing Requirements or LR : Bursa Malaysia Securities Berhad Main Market Listing Requirements LPD : 31 July 2012, being the latest practicable date prior to the printing of this Circular NA : Net Assets NBV : Net Book Value PLA or Proposal : Proposed land acquisition by Seacera Properties Sdn. Bhd., a wholly-owned subsidiary of Seacera of a freehold land measuring approximately acres identified as provisional plot no. M.S. 269/1996/8A, M.S. 269/1996/10A and M.S. 269/1996/11A forming part of a piece of land held under Geran 23940, Lot 613, Mukim Ulu Semenyih, District Ulu Langat, Negeri Selangor Darul Ehsan from DSSB for a cash consideration of RM78,130, Plot 8A : Part of the Land identified as provisional plot number M.S. 269/1996/8A, measuring approximately acres Plot 10A : Part of the Land identified as provisional plot number M.S. 269/1996/10A, measuring approximately acres Plot 11A : Part of the Land identified as provisional plot number M.S. 269/1996/11A, measuring approximately acres Psf. : Per square foot Purchase Consideration : A total cash consideration of Ringgit Malaysia Seventy Eight Million One Hundred and Thirty Thousand (RM78,130,000.00) only ii

4 Purchaser s Solicitor : Messrs. Lee Choon Wan & Co., Advocates & Solicitors of No. 12 Lorong Dungun, Damansara Heights, Kuala Lumpur RM and sen : Ringgit Malaysia and sen, respectively Sale and Leaseback : As approved by the shareholders on 10 October 2011 of a sale/disposal of the Property by Seacera to Suong Sdn. Bhd. ( K) at a consideration price of RM62,000,000 subject to and upon the terms and conditions of the SPA and the proposed rental of the Property to be entered by Seacera with the Purchaser of Selayang Land at any point of time but prior to the completion of the Proposed Sale, which rental will be for a period of four (4) years commences upon completion of the Proposed Sale, with an option to renew the same for another one (1) year, at an agreed rental amount and upon such terms and conditions as stipulated in the Tenancy Agreement to be entered (for definitions and further details, please refer to circular dated 23 September 2011) SPA : Sale and Purchase Agreement signed between the Purchaser and the Vendor on 10 April 2012 Seacera or Company : Seacera Group Berhad ( H) Seacera Group or Group : Seacera and its subsidiary companies (as defined in Section 5 of the Act), collectively Shares : Ordinary shares of RM1.00 each in Seacera SPSB or Purchaser : Seacera Properties Sdn. Bhd. ( X) Target Lands : Plot 8A, Plot 10A and Plot 11A identified collectively as a group Valuation Report : A valuation report prepared by the Valuer dated 7 May 2012 to assess the market value of the Target Lands Vendor or JVA Partner or DSSB : Duta Skyline Sdn. Bhd. ( U) 5D-WAMP : Five (5)-day weighted average market price In this Circular, unless there is something in the subject or context inconsistent herewith, the singular includes the plural and references to a gender include both genders and the neuter. References to persons shall include corporations. Any reference in this Circular to any enactment is a reference to that enactment as for the time being amended or re-enacted. Any reference to a time of day in this Circular shall be a reference to Malaysia time, unless stated otherwise. Certain figures included in this Circular have been subject to rounding adjustments. iii

5 CONTENTS LETTER TO THE SHAREHOLDERS OF SEACERA CONTAINING:- SECTION PAGE 1. INTRODUCTION 1 2. DETAILS OF THE PLA 2 3. RATIONALE FOR THE PLA INDUSTRY OUTLOOK AND FUTURE PROSPECTS RISK FACTORS EFFECTS OF THE PLA APPROVALS REQUIRED ESTIMATED TIMEFRAME FOR COMPLETION CORPORATE PROPOSALS ANNOUNCED BUT PENDING COMPLETION DIRECTORS AND MAJOR SHAREHOLDERS INTERESTS DIRECTORS RECOMMENDATION EGM FURTHER INFORMATION 19 APPENDICES I VALUATION CERTIFICATE FOR THE TARGET LANDS DATED 7 MAY 2012 PREPARED BY JB 20 II FURTHER INFORMATION 21 NOTICE OF EXTRAORDINARY GENERAL MEETING FORM OF PROXY Enclosed Enclosed iv

6 GROUP BERHAD (Company No H) (Incorporated in Malaysia) Registered Office 802, 8th Floor, Block C Kelana Square 17, Jalan SS7/ Petaling Jaya Selangor Darul Ehsan 14 August 2012 Directors YBhg. Datuk Mansor bin Masikon (Non-Independent Non-Executive Chairman) Encik Zulkarnin bin Ariffin (Managing Director) Tuan Hj. Basar bin Juraimi (Senior Independent Non-Executive Director) Cik Norhanum binti Nordin (Independent Non-Executive Director) Tuan Hj. Ab Halim bin Ismail (Independent Non-Executive Director) To : The Shareholders of SEACERA GROUP BERHAD Dear Sir/Madam, PROPOSED LAND ACQUISITION BY SPSB, A WHOLLY-OWNED SUBSIDIARY OF SEACERA OF A FREEHOLD LAND MEASURING APPROXIMATELY ACRES IDENTIFIED AS PROVISIONAL PLOT NO. M.S. 269/1996/8A, M.S. 269/1996/10A AND M.S. 269/1996/11A FORMING PART OF A PIECE OF LAND HELD UNDER GERAN 23940, LOT 613, MUKIM ULU SEMENYIH, DISTRICT ULU LANGAT, NEGERI SELANGOR DARUL EHSAN FROM DUTA SKYLINE SDN. BHD. FOR A CASH CONSIDERATION OF RM78,130, INTRODUCTION On 10 April 2012, the Company announced to Bursa Securities that SPSB, a wholly-owned subsidiary of Seacera had on 10 April 2012 entered into a sale and purchase agreement with DSSB to acquire the Target Lands measuring approximately acres in total and identified as provisional plot no. M.S. 269/1996/8A, M.S. 269/1996/10A and M.S. 269/1996/11A on the Land which known as Geran 23940, Lot 613, Mukim Ulu Semenyih, District Ulu Langat, Negeri Selangor Darul Ehsan for a cash consideration of RM78,130, The purpose of this Circular is to provide you with the relevant information and explain the details of the PLA and to seek your approval for the resolution pertaining to the PLA to be tabled at the forthcoming EGM. The notice of the forthcoming EGM and the form of proxy are enclosed together with this Circular. YOU ARE ADVISED TO READ AND CAREFULLY CONSIDER THE CONTENTS OF THIS CIRCULAR BEFORE VOTING ON THE RESOLUTION PERTAINING TO THE PLA. 1

7 2. DETAILS OF THE PLA 2.1. Information on the Target Lands The Land is a freehold land held under Geran 23940, Lot 613, Mukim Ulu Semenyih, Daerah Ulu Langat, Negeri Selangor Darul Ehsan measuring approximately acres and has the category of land use as Building and is currently not subject to any restrictions-in-interest. The Land has been proposed for subdivision into thirteen (13) block titles. The reason for subdivision is to allow effective and efficient planning of the Land especially for future development on the Land which can be done phase by phase. The undivided portions of the said vacant Target Lands measuring approximately acres are identified by its respective provisional lot number as follows:- (a) (b) (c) M.S. 269/1996/8A, measuring approximately acres; M.S. 269/1996/10A, measuring approximately acres; and M.S. 269/1996/11A, measuring approximately acres. A Sub-Divided Title will be issued to the Purchaser for each of the Target Lands. Information on the original cost of investment and date of investment on the Land is not available. The information on the NBV of the Target Lands is not available to SPSB, however, the total NBV of the Land as per DSSB s audited financial statements FYE 31 December 2011 was RM140,313, Thus, by using area of the Target Lands as a basis for deriving the NBV of the Target Lands, the amount is approximately RM38,600, The Vendor is the registered owner of the Land and the Land is presently charged to Danaharta and BIMB. Details of the current registered charges are as follows:- (a) (b) a first legal charge registered on 25 July 1996 in favour of Pengurusan Danaharta Nasional Berhad ( Danaharta ) vide presentation no /1996, Jil. 84, Fol. 164, in respect of the credit facility granted by BSN Commercial Bank (Malaysia) Berhad to the Vendor (which has been vested to Danaharta vide a Vesting Certificate dated 5 April 1999) ( Danaharta s Charge ); and a second legal charge registered on 26 February 2001 in favour of Bank Islam Malaysia Berhad ( Bank Islam ) vide presentation no. 9715/2001, in respect of the credit facility granted by Bank Islam to the Vendor ( Bank Islam s Charge ). Danaharta s Charge and Bank Islam s Charge shall collectively known as Charges. The Charges shall be uplifted prior to the completion date of the PLA. As part of the conditions precedent of the SPA, the Target Lands are to be acquired free from all encumbrances, charges, claims, caveats (private or otherwise save for those entered by the Purchaser), liens and equities whatsoever but subject to all restrictions in interest and conditions of title applicable thereto. The Target Lands are accessible from Kajang Town and other developed areas on the north as well as via Kajang Silk Highway which exit at the Kajang Perdana/Bandar Sungai Long interchange, thereon continues onto Jalan Semenyih. The Target Lands are within 25 kilometre radius from the city centre of Kuala Lumpur. The Target Lands if travelled by road are located about 40 kilometres to the south-east of Kuala Lumpur and approximately 33 kilometres to the south-west of Putrajaya. Lembaga Lebuhraya Malaysia vides their letter dated 4 August 2006 (Reference: No. Bil. (7) dlm LLM/KS/2000/2/ ) has given the approval for the proposed access road from Sistem Lingkaran-Lebuhraya Kajang Highway ( SILK Highway ) to the Target Lands. The distance of the proposed access road from the Target Lands to the SILK Highway is approximately two (2) kilometres. Geographically, the Target Lands are located along the settlement area known as Kampung Sungai Pening, within the area of Kajang-Semenyih Township. 2

8 The Target Lands are currently vacant. The PLA is for the purpose of investment in land at a strategic location with potential for development purpose. Subject to the approval and completion of the PLA, the Target Lands are proposed to be developed into a mixed development project comprising residential and commercial units. The development is proposed to be financed by internally-generated funds and bank borrowings. Subject to conditions and circumstances of development cost as and when the development takes place, the Company expects to raise bank borrowings of approximately 30%-40% of the construction cost. The balance would be financed by the collection of sales proceeds from the development project. As the PLA are for the investment of a good location land bank, therefore, pending the submission of the development approval and subject to its final approval, it is too preliminary to ascertain the estimated gross development value of the Target Lands, the number of units in respect of each type of development, total development cost, the expected date and completion dates, the expected profits to be derived from the development of the Targets Land and the additional financial commitments to put the Target Lands on-stream. Upon availability of the aforesaid information relating to the development of the Target Lands, the Company will make the necessary announcement in accordance with Appendix 10B, Part C of the Listing Requirements Salient terms of the SPA The salient terms of the SPA include inter-alia, the following: The Target Lands are acquired:- (a) (b) (c) on an as is where is basis free from all encumbrances, charges, claims, caveats (private or otherwise save for those entered by the Purchaser), liens and equities whatsoever but subject to all restrictions in interest and conditions of title applicable thereto whether express or implied and as may be set out in the individual issue document of title to be issued in respect thereof; with vacant possession to the Target Lands; and upon the basis that each of the warranties given by the Vendor as detailed in the SPA is true and accurate in all respects The Purchase Consideration for the Target Lands shall be paid in the following manner:- (a) (b) on the day of execution of the SPA, the Purchaser shall settle the sum of Ringgit Malaysia Seven Million Eight Hundred and Thirteen Thousand (RM7,813,000.00) only (hereinafter referred to as Deposit ), by way of a set off against an equivalent amount of the JVA Payment and accordingly such equivalent amount of the JVA Payment so set off shall be deemed by the Vendor and the Purchaser as payment of the Deposit; within one (1) month from the date of the SPA or such other later timeframe as may be agreed between the Vendor and the Purchaser, the Purchaser shall pay to the Vendor or settle the sum of Ringgit Malaysia Fifteen Million (RM15,000,000.00) only (hereinafter referred to as Subsequent Payment ) as part payment of the Purchase Consideration in the following manner: (i) (ii) by way of a set off against the remaining balance of the JVA Payment [after the set off of the Deposit pursuant to Clause (a)] of approximately Ringgit Malaysia Two Million (RM2,000,000.00) only and accordingly such amount of the JVA Payment so set off shall be deemed by the Vendor and the Purchaser as part payment made towards the account of the Subsequent Payment; and the sum of Ringgit Malaysia Thirteen Million (RM13,000,000.00) only shall be paid to the Vendor in cash; and (c) the Purchaser shall pay to the Vendor the sum of Ringgit Malaysia Fifty Five Million Three Hundred and Seventeen Thousand (RM55,317,000.00) only (hereinafter referred to as Balance Purchase Consideration ) free of interest any time and from 3

9 time to time within five (5) years commencing from the Effective Date. Effective Date is further defined in Clause below. In accordance to the SPA, the total amount set off against the JVA Payment is Ringgit Malaysia Nine Million Eight Hundred and Thirteen Thousand (RM9,813,000.00) only, which is deemed paid as at the date of this Circular. As at the LPD, the total amount of the balance of JVA Payment in respect of the Land is approximately Ringgit Malaysia Eleven Million Three Hundred Thousand (RM11,300,000.00) only and since the JVA is pending completion, the Company is not able to assess the balance amount payable for the JVA which depends mainly on the type of development to be carried out and its gross development value. In accordance to the JVA, the payments were made for all outgoings in respect of the Land. The Vendor and the Purchaser have agreed that the payment and/or settlement of the Purchase Consideration in respect of any Plot 8A, Plot 10A and Plot 11A shall be determined by the Purchaser in its sole and absolute discretion, that is, the Purchaser has the liberty to select to pay and/or settle any of the Individual Plots in any sequence. If the Vendor intends to sell the remaining portion of the said Land (not already sold to the Purchaser), the Vendor agrees that the Vendor shall give the Purchaser the first right of refusal of purchasing such unsold portion upon the terms and conditions of a sale and purchase agreement to be mutually agreed between both the Vendor and the Purchaser. The Target Lands are part of the same land to be developed under the JVA and the scope of development is initially for the entire Land. However, upon execution of the SPA, the Vendor and the Purchaser agree that their respective obligation under the JVA in respect of the Target Lands shall be suspended and neither party is obligated to perform, continue or execute its obligation under the JVA in respect of the Target Lands and such suspension shall continue during the subsistence of the SPA. Under the JVA, the parties would construct and develop the Land on a joint venture basis comprising residential and commercial units and/or the developer to sell any part of the Land as part of its development proposal and/or to co-develop any part of the Land with any other third party subject to terms and conditions contain therein. Among the terms and conditions of the JVA, the parties involved are to restructure the loans due to the Chargees, which would ultimately allow the parties to develop the Land, to successfully subdivide the Land and to agree between parties on the composition and contents of the re-layout and development plan. However, as the process of finalising the loans restructuring as well fulfillment of the conditions precedents of the JVA is still on going, the parties have not been able to proceeds further works required for the development on the Land. Hence, the JVA has been extended to allow parties to finalise these matters including fulfilment of the conditions precedent. For avoidance of doubt, the Company does not assume any liabilities in the JVA The Conditions Precedent ( CP ) of the SPA are as follows:- (a) the removal of the existing caveats and any other caveats (private or Registrar) entered on the said Land subsequent to the date of the land search result as attached in the SPA (hereinafter referred to as Caveats ) by the Vendor at its own cost and expense and for this purpose, the Vendor agrees to grant and deliver to the Purchaser and/or its nominees an irrevocable power of attorney or such other authorisation as may at any time and from time to time be requested by the Purchaser in connection with the removal of the Caveats and shall not revoke, amend, vary or alter any authority or instruction formerly given to the Purchaser in connection therewith on which the Purchaser has acted or relied upon in any material respect; the Vendor agrees that it shall be lawful for but not obligatory upon the Purchaser to pay such sum on monies on behalf of the Vendor to secure the withdrawal of the Caveats and the Purchaser is entitled to deduct from the Balance Purchase Consideration all such monies expended by the Purchaser only after production of the 4

10 relevant receipt(s) or such other documents evidencing payment by the Purchaser of such sums; (b) (c) the issuance of and delivery of the original block titles and/or individual issue documents of title to or for the Target Lands resulting from the subdivision of the said Land (hereinafter referred to as Sub-Divided Titles ) by the Vendor at its own cost and expense and for this purpose, the Vendor agrees to grant and deliver to the Purchaser and/or its nominees an irrevocable power of attorney or such other authorisation as may at any time and from time to time be requested by the Purchaser in connection with the procurement of the said Sub-Divided Titles and shall not revoke, amend, vary or alter any authority or instruction formerly given to the Purchaser in connection therewith on which the Purchaser has acted or relied upon in any material respect; delivery of the Redemption Documents which includes:- (i) (ii) the original issue document of title to the said Land; the valid and registrable discharges of charge (Form 16N pursuant to the National Land Code 1965) duly executed by the Chargees; (iii) the duplicate charges (Forms 16A pursuant to the National Land Code 1965 together with its annexure) in respect of the charges; and (iv) any other documents as may be deemed necessary by the Purchaser to effect the discharge of the charges over the said Land and to ensure that the Vendor s rights, title, interest and benefits in and to the Target Lands as registered /beneficial proprietor are absolutely and unconditionally reverted to the Vendor free from any encumbrances, charges, caveats, claims, lien and equities whatsoever; (d) (e) (f) the Vendor and the Purchaser or where applicable, its holding company obtaining or procuring the approval of its directors and or shareholders for the sale and purchase of the Target Lands; the Purchaser, shall have obtained the approval of the EPU or shall have notified the EPU, where applicable, of the acquisition by the Purchaser of the Target Lands; and the Purchaser obtaining such other approvals as may be deemed necessary by the Purchaser for the sale and purchase transaction contemplated herein. The CP is considered to be completed upon the fulfillment of the above obligations within one (1) year from the date of the SPA with a further extension of one (1) year commencing upon the expiry of the first (1 st ) year or such other extension of time as maybe mutually agreed in writing by the Vendor and the Purchaser. The SPA shall become unconditional on the Business Day after which the Vendor or the Purchaser s Solicitor receives a copy of the documents evidencing satisfaction or waiver of the CP (hereinafter referred to as the Effective Date ). To the extent permitted by law, the fulfillment of or compliance with the conditions precedent as set out above or any of them or any part thereof may be waived wholly or in part by the Purchaser in their sole and absolute discretion In view of Clause above, the Vendor hereby irrevocably and unconditionally appoints the Purchaser or any of its directors or officers to be the Vendor s attorney (hereinafter referred to as Attorney ) to execute the following:- (a) to negotiate, finalise or agree to any or all arrangements, enter into, give, sign, endorse and execute any or all undertaking, covenant, agreement, documents or arrangement, receipts, cheques, releases, discharges, reconveyances, or other deeds or 5

11 documents whatsoever that may be necessary to secure the release of the Caveats and the issuance of the Sub-Divided Titles; (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) (l) to negotiate and deal with all federal, state, and local government, statutory, semi-or quasi-governmental and/or other authorities and bodies having jurisdiction at any time and from time to time over the said Land or any part thereof or whose licence, consent, permit, approval and/or co-operation may be required and/or necessary for the sub-division or the removal and withdrawal of the Caveats (hereinafter referred to as Appropriate Authorities ), each respective Caveat holder (or its representative) and any other third parties in all or any matters pertaining to the Sub-Divided Titles and the Caveats including attending to any enquiries raised by any of these parties in respect of thereof; to communicate, liaise, coordinate and monitor with such parties in all matters pertaining the Caveat and the Sub-Divided Titles, including but not limited to the preparation, drawing up, executing and submission of all necessary applications, documents and forms whatsoever for the issuance of the Sub-Divided Titles and the removal or withdrawal of the Caveats; to execute or receive any or all notices, correspondence, directives and other documents in respect of the Caveats and the Sub-Divided Titles; to deposit with the Appropriate Authority or any third party any sum or sums of money, for and on behalf of the Vendor, as required from time to time in respect of the Caveats and the Sub-Divided Titles; to make arrangements and to pay for and on behalf of the Vendor all taxes, stamp duty, rates, assessments, legal fees, charges, disbursements, insurances, expenses and other outgoings whatsoever required from time to time to be paid by the Vendor or chargeable on the Vendor in respect of the Sub-Divided Titles and the removal or withdrawal of the Caveats including, without limitation, all charges or fees that may be levied or leviable by the Appropriate Authority or such other third party; to institute or pursue or defend or appear or to commence any action or other proceedings before any court of law, judicial or administrative bodies, governmental officials and tribunals in all suits actions compromises inquiry or other proceedings in connection with the Sub-Divided Titles or the removal and withdrawal of the Caveats; to submit to the Appropriate Authority the original issue document of title of the said Land for the purpose of the issuance of the Sub-Divided Titles; to liaise, negotiate, appoint and deal with all consultants such as architects, civil and structural engineers, mechanical and electrical engineers, quantity surveyors, said Land surveyors and others on all technical matters related to the Sub-Divided Titles; to execute any document or forms for the transfer of the Sub-Divided Titles to the Purchaser; generally to exercise all rights and privileges and perform all duties which now or hereafter may appertain to the Vendor in relation to the Caveats and the Sub-Divided Titles including all duties which are in the opinion of the Attorney necessary, expedient or desirable in order to obtain the Sub-Divided Titles and removal or withdrawal of all Caveats as amply and effectually for all intents and purposes the Vendor could do in its proper person if this Power of Attorney had not been made; to cause the power of attorney to be registered at the registry of the High Court of Malaya and in the books of any company or corporation or elsewhere as may be deemed necessary by the Attorney; and 6

12 (m) to disclose to any person or party who may be concerned with the exercise of the powers hereby conferred the terms of the SPA and such other documents or information as may be related thereto or to the exercise of the Attorney s powers hereunder where such disclosure is deemed by the Attorney to be necessary for the exercise of their powers hereunder The Vendor shall deposit or to be deposited to the Purchaser or the Purchaser s Solicitor of the following documents:- (a) on the date of the SPA or immediately upon the execution of the SPA, a valid and registrable (save for stamping) memorandum of transfer (in accordance with the National Land Code 1965) duly executed by the Vendor in respect of the transfer of the Target Lands or where applicable, an Individual Plot (hereinafter referred to as MOT ). If the MOT is in the possession of the Purchaser s Solicitors, the Purchaser s Solicitors are hereby authorised by the Vendor and the Purchaser to submit the MOT to the Collector of Stamp Duty solely for the purpose of adjudication and stamping thereon as soon as reasonably practicable for the purpose of effecting the transfer of a paid Individual Plot in accordance with Clause and thereafter, to present the MOT for registration at the relevant land office any time after the date when the Purchaser settles the Balance Purchase Price attributable to that Individual Plot; (b) within fourteen (14) Business Days from the date of the SPA:- (i) (ii) (iii) (iv) (v) (vi) the duly executed change of name form (in accordance with the National Land Code 1965) in respect of the change of the Vendor s name; the copies certified as true of the current year quit rent and assessment receipts; the Vendor s certificate of incorporation and memorandum and articles of association, each certified as a true copy by a director or the company secretary of the Vendor; the Vendor s latest Forms 24, 44 and 49, each certified as a true copy by a director or company secretary of the Vendor; the Vendor s board of directors and members resolutions approving the disposal of the Target Lands and authorising the execution, delivery and performance of the SPA and the affixation of the common seal of the Vendor (in accordance with the Vendor s memorandum and article of association) on all relevant documents in respect of the sale of the Target Lands to the Purchaser, each certified as a true copy by a director or the company secretary of the Vendor; and all other relevant documents to effect the transfer of the Target Lands to the Purchaser which the Purchaser may deem necessary. (All the above documents collectively referred to as Transfer Documents ) The Purchaser shall be entitled to terminate the SPA at any time subject to the following, if:- (a) (b) any of the warranties given by the Vendor is found at any time to be untrue or incorrect; the Vendor fails, neglects or refuses to perform or comply with any of its obligations under the SPA; 7

13 (c) (d) an order has been made for the winding up or dissolution of the Vendor (voluntary or otherwise), or a resolution has been passed or any steps has been taken to pass a resolution for the winding up or dissolution of the Vendor; or distress, attachment or execution is levied or enforced upon the Target Lands or any substantial part of the assets or undertakings of the Vendor which prevents the completion of the sale and purchase transaction contemplated herein; and within seven (7) Business Days of such notice terminating the SPA:- (i) (ii) the Vendor shall return or caused to be returned all monies received by it which shall include those payments by way of set off as part of the Purchase Consideration to the Purchaser free from interest together with an additional sum equivalent to the Deposit being agreed liquidated damages subject to detailed terms and conditions as provided in the SPA. Thus, the JVA Payment duly set off for the Deposit would need to be returned by the Vendor to the Purchaser and would be deemed as an agreed liquidated damages payable by the Vendor to the Purchaser; and the Purchaser shall or shall ensure the return of the Transfer Documents and any of the Redemption Documents, if the same have been delivered by the Vendor and redelivery of vacant possession of the Target Lands, if the same have been delivered provided always that if the MOT has been duly adjudicated and stamped, the Purchaser s Solicitors shall be authorised to surrender the MOT to the relevant authorities for cancellation and seek a refund of the stamp duty paid prior to the return of the same to the Vendor. Provided always that the rights set out in Clause shall not extend or be applicable to or affect the completion of the paid Individual Plots in any manner whatsoever and references in Clause to Deposit or Purchase Consideration shall be deemed to exclude the relevant portions of the same attributable to any paid Individual Plot. References in Clause to the Transfer Documents, MOT and the Redemption Documents shall also be deemed to exclude the relevant Transfer Documents, MOT and the Redemption Documents relating to any paid Individual Plot. The warranties by the Vendor to Purchaser are:- (a) (b) (c) (d) (e) the Vendor is beneficial and/or registered owner of the Target Lands and there is no previous sale or agreement for the sale of the Target Lands or any of the Individual Plot which is still subsisting and which has not been validly and lawfully terminated or rescinded and there are no adverse claims or interests in relation to or affecting the Target Lands; the Vendor has not and shall not after the date of the SPA, sell, dispose, charge, mortgage, assign or in any manner whatsoever encumber the Target Lands or any part thereof, or create or permit to be created any lien over the Target Lands, or any part thereof, save for the Charges registered in favour of the Chargees; the Vendor is entitled to and has full ability to transfer (or procure the transfer of) its rights, title, interest and benefits in and to the Target Lands to the Purchaser absolutely; the Vendor shall do all necessary things and take all necessary steps to preserve and maintain the Vendor s rights, title, interest and benefits in and to the Target Lands to enable the Target Lands to be transferred absolutely to the Purchaser free from all encumbrances, charges, claims, lien and equities whatsoever, but subject to all conditions of title applicable thereto whether expressed or implied; the Target Lands are all vacant and there are no claims adversely affecting the rights of the Vendor to the vacant possession of the Target Lands; 8

14 (f) (g) (h) (i) (j) (k) the Vendor has not received any notices from any federal, state and/or local government authority or statutory board which remain outstanding and which will or may prejudice, or adversely affect the present or continued use and enjoyment by which the Vendor or its successors in title of the Target Lands of which will or may subject the Vendor or its successors in title to any onerous charge or liability, and that the Vendor shall immediately give notice to the Purchaser of any such notices, orders or requirements which the Vendor receives from any federal, state and/or local government authority or statutory board at any time after the date of the SPA; there is no pending suit, legal proceeding, claim, winding up proceeding against the Vendor which may affect in any way the rights of the Vendor in relation to the Target Lands, or any part thereof, and the Vendor shall not do anything which might give rise to any legal proceedings or claims against the rights of the Vendor or the Purchaser in relation to the Target Lands or any part thereof; all quit rents, assessments, charges, rates and other outgoing in respect of the Target Lands have been duly paid, and shall, as at date the vacant possession of the Target Lands shall be delivered by the Vendor to the Purchaser on the completion date, have been duly paid up thereto; the Vendor is legally competent to execute, deliver and perform the terms of the SPA and the Vendor is not insolvent and there are no winding up and/or foreclosure proceedings pending against them and/or the Target Lands; the Vendor has not infringed or defaulted in the observance of any bylaws or regulations to the Target Lands (express or implied) which may result in the Purchaser not being able to have a full and quiet enjoyment of the Target Lands; and the matters set out in the recitals to SPA in respect of the Vendor and the Target Lands are true and correct in all material respects The Vendor shall be entitled to terminate the SPA by notice in writing to the Purchaser if the Purchaser commits a material breach in its obligations under the SPA and in the case of a breach capable of remedy, failing to remedy the same within one (1) month of being specifically required in writing to do so by the Vendor or such other later time frame as the Vendor may agree upon. Within seven (7) Business Days of such notice terminating the SPA:- (a) (b) (c) the Deposit as deemed paid and/or settled shall be forfeited in favour of the Vendor as agreed liquidated damages. Thus the JVA Payment duly set off for the Deposit would no longer be regarded as part of the JVA Payment but as an agreed liquidated damages instead; the Vendor shall return or caused to be returned any monies received by them as part of the Balance Purchase Consideration to the Purchaser free of interest subject to detail terms and conditions as provided in the SPA; and the Purchaser shall return or shall ensure the return of the Transfer Documents and any of the Redemption Documents, if the same has been delivered by the Vendor and the redelivery of vacant possession of the Target Lands, if the same have been delivered provided always that if the MOT has been duly adjudicated and stamped, the Purchaser s Solicitors shall be authorised to, surrender the MOT to the relevant authorities for cancellation and seek a refund of the stamp duty paid prior to the return of the same to the Vendor. Provided always that the rights set out in Clause shall not extend or be applicable to or affect the completion of the paid Individual Plots in any manner whatsoever and references in Clause to Deposit, Subsequent Payment or Balance Purchase Consideration shall be deemed to exclude the relevant portions of the same attributable to any paid Individual Plot. References in Clause to the Transfer Documents, MOT and the Redemption Documents shall also be deemed to exclude the relevant Transfer Documents, MOT and the Redemption Documents relating to any paid Individual Plot. 9

15 2.3. Basis and justification on arriving at the Purchase Consideration The purchase price for the PLA of RM78,130, was arrived at a willing buyer-willing seller basis after taking into consideration the following:- (i) (ii) (iii) (iv) (v) its existing category of land use of Building with the amount payable to authorities for converting the Land use status from Agriculture to Building (known as premiums or fees payable to authorities) duly paid by the Vendor. Based on the land title, the land was converted from Agriculture use to Building use on 3 May The information on premium amount paid and date of payment is not privy/available to the Company; sizeable freehold land of approximately acres in a strategic location of a suburban area with close proximity to other popular areas, such as Serdang, Bandar Mahkota Cheras, Bandar Sungai Long and Saujana Impian; increasing demand for residential and commercial properties within ten (10) kilometres radius from the Land evident by the new developments such as Naza TTDI the Grove, Nadayu 92, Tiara Residence, Ramal Villa, Twin Palms, Jade Hills, Sentosa Heights and Semenyih Sentral, just to name a few of which is located in Kajang area; decent discounted land cost of RM13.00 psf. as compared to the market value of the Target Lands of RM87,450, or approximately RM14.55 psf. as proportionately assessed by the Valuer vide its certificate valuation letter dated 7 May 2012, using the comparison method of valuation which enable Seacera to price its proposed future development at a competitive pricing with reasonable margins. The said purchase price represents a discount of approximately 11% over the market value of the Target Lands which was derived on a willing buyer and willing seller basis upon the several negotiations between SPSB and DSSB. As further stated below and Section 3 (a), the discount given to derive the purchase price was reasonable in view of similar prices transacted by reputable property development companies such as UEM Land Bhd. and SP Setia Berhad; and the Company s knowledge and references to the transactions in the surrounding areas, such as Bangi by UEM Land Bhd., Rinching at Ulu Semenyih by SP Setia Berhad, Kajang Hill Golf Club at Jalan Reko Semenyih by Dijaya Corporation Berhad and Kajang by Knusford Berhad. The Company has obtained all information from sources publicly available as announced by the respective companies to Bursa Securities Salient features of the Valuation Report In arriving at the opinion for market value of the Land, JB had appraised the Land in its Valuation Report using the comparison method of valuation. The method entails comparing the Land with similar properties that have been sold recently and those that are currently being offered for sale in the vicinity or other comparable localities. The characteristics, location, size and shape of the lot, physical features, legal and legislative constraint, time element, merits and demerits of these properties are noted and appropriate adjustments thereof are then made to reflect the differences and to arrive at the value of the Land. In a valuation of homogeneous real estates such as vacant lands, the comparison method is the most appropriate method of valuation as there are less adjustments and analysis on the comparables. The Land is designated for residential development which is in line with the category of land use stated in the title. Based on the Valuer s enquiries at the Town Planning Department of Majlis Perbandaran Kajang, there was no latest submission and application for the development on the Land which was lapse before. Thus, the investment approach of discounted cash flow method and residual approach method are not suitable due to many assumptions would have to be drawn thus rendering the calculations to be too subjective. Therefore, the most reliable and appropriate method of valuation applicable to the Land is the comparison method which was the only method implemented for the valuation of the Land. 10

16 The valuation of the Land was undertaken in accordance with the Guidelines on Asset Valuations issued by the Securities Commission Malaysia and the Valuation Standards issued by the Board of Valuers, Appraisers and Estate Agents Malaysia as per Appendix I. The Land was inspected by the Valuer on 15 March Since Seacera is acquiring certain portion of the Land which is identified as the Target Lands, the value of the Target Lands are proportionately assessed and calculated using area of the Target Lands over total area of the Land. The basis is deemed as the most appropriate basis to be used in deriving the market value of Target Lands. JB is of the opinion that the market value of the Target Lands are Ringgit Malaysia Eighty Seven Million Four Hundred Fifty Thousand (RM87,450,000.00) only as appraised vide its Valuation Report, with vacant possession, free from all encumbrances, subject to the title being good, marketable and registrable Source of funding Seacera will satisfy the entire Purchase Consideration by way of cash consideration from bank borrowings of approximately Ringgit Malaysia Thirteen Million (RM13,000,000.00) only and the balance of approximately Ringgit Malaysia Fifty Five Million Three Hundred and Seventeen Thousand (RM55,317,000.00) only from its internally generated funds. In addition, a set off of RM9,813, was also part of the total Purchase Consideration. Details on the manner of payment for Purchase Consideration are set out in Clause of the Circular. The exact combination of internally generated funds and bank borrowings will be determined by the management of Seacera at a later stage, after taking into consideration the Group s gearing level, interest costs and internal cash requirements for its business operations. The Company will make an announcement on the exact combination of internally generated funds and bank borrowings once it has been determined. Given the long period of time for payment of approximately five (5) years commencing from the Effective Date, Seacera is expected to have ample time to generate the required cash flow for the purpose of paying the Balance Purchase Consideration Information on the Purchaser The Purchaser was incorporated in Malaysia under the Act on 23 September The Purchaser is a wholly-owned subsidiary of Seacera and is currently a dormant entity. The principal activity of SPSB is property development. As at the date of this Circular, SPSB does not has any subsidiary. As at LPD, the directors of the Purchaser are:- (a) (b) Zulkarnin Bin Ariffin; and Mohd Amir Bin Abdullah. The authorised share capital of SPSB is RM100, comprising 100,000 ordinary shares of RM1.00 each. The issued and paid-up capital of SPSB is RM2.00 comprising 2 ordinary shares of RM1.00 each. SPSB was initially a marketing arm of the Company and became dormant since It was converted to undertake the JVA and do not have any other project thereafter. The number of workforce in SPSB is less than ten (10) staff at any one time Information on the Vendor The Vendor was incorporated in Malaysia on 31 March The principal business of the Vendor is property investment holding. 11

17 As at LPD, the directors of the Vendor are:- (a) (b) Ismail Bin Othman; and Mohd Razip Bin Hamzah. It has an authorised share capital of RM25,000, comprising 25,000,000 ordinary shares of RM1.00 each of which 22,055,000 ordinary shares of RM1.00 each had been fully issued and paid-up. As at LPD, the Vendor s substantial shareholders are:- (i) (ii) (iii) Duta Nilai Holdings Sdn. Bhd. (the shares in Duta Nilai Holdings Sdn. Bhd. is 99.99% owned by Ismail Bin Othman); Mohd Razip Bin Hamzah; and Ismail Bin Othman. Directors and substantial shareholders respective shareholdings in DSSB:- Directors Substantial Shareholders % of holding in DSSB Mohd Razip Bin Hamzah Mohd Razip Bin Hamzah 27.3 Ismail Bin Othman Ismail Bin Othman Duta Nilai Holdings Sdn. Bhd Total: Liabilities to be assumed Save for the bank borrowings to be procured for the partial payment of the Purchase Consideration in relation to the PLA, Seacera will not assume any other liabilities, including contingent liabilities and guarantees arising from the PLA. 3. RATIONALE FOR THE PLA After due consideration, our Board is of the view that the PLA is part of Seacera strategy to continue acquiring sizeable land banks with good development potential in strategic locations, which will provide an opportunity for the Company to expand and strengthen its existing business of property development. In addition, the Company is also of the opinions that among other rationale are:- (a) SPSB to be a focused property player with a sizeable land bank With the increased demand and development activities in Kajang area as evidenced in Clause 2.3, SPSB would fully concentrate at developing the Target Lands for a significant period of time of approximately not less than ten (10) years. Hence, the PLA is in line with the Company s plan to ensure that its property development division would become one of its core businesses and growth area for the Group. The PLA will be the right opportunity for Seacera to invest on the Target Lands as part of its land bank for future development. All development lands previously owned by the Group had been either developed or sold at decent profits. On Kayu Ara project, a piece of land in Kayu Ara identified as H.S.(M) 3776, PT No. 944 measuring approximately 1.14 acres has generated gain from joint venture arrangement of RM2.3 million. Another piece of land, also in Kayu Ara identified as part of PN15982, Lot measuring approximately 1.54 acres have generated gain on disposal of the land of RM1.1 million. The disposal of a subsidiary company which own a piece of land identified as PN15980, Lot in Pekan Kayu Ara measuring approximately 2.3 acres has resulted a gain of RM5.7 million. Currently, except for the land under JVA, Seacera has not owned any ready development land. A decent discount of approximately eleven percent (11%) against the market value of the Target Lands and deferment of the Balance Purchase Consideration of RM55,317, to be 12