PROPOSED DISPOSAL OF THE SUMMIT HOTEL BUKIT MERTAJAM ( PROPOSED DISPOSAL )

MEDA INC BERHAD ( MEDA OR THE COMPANY ) PROPOSED DISPOSAL OF THE SUMMIT HOTEL BUKIT MERTAJAM ( PROPOSED DISPOSAL ) 1. INTRODUCTION Board of Directors of Meda ( Board ) wishes to announce that the Company had on 20 April 2017, entered into a conditional Sale and Purchase Agreement ( SPA ) for the proposed disposal of The Summit Hotel Bukit Mertajam to Teraju Menang Sdn. Bhd. (Company No : 1139311-D) (hereinafter referred to as the Purchaser or TMSB ) owned by wholly owned subsidiary, ZKP Development Sdn. Bhd. (hereinafter referred to as the Vendor or ZKP ) for a consideration of Twenty Million only (RM20,000,000) inclusive of Goods and Services Sales Tax ( GST ) (hereinafter referred to as the Purchase Price ). Further details of the Proposed Disposal are set out in the ensuing sections. 2. THE PROPOSED DISPOSAL 2.1 Details of The Proposed Disposal Subject to the terms and conditions of the SPA, Meda shall sell and the Purchaser agrees to purchase from Meda, The Summit Hotel Bukit Mertajam free from all encumbrances (including but not limited to, any caveats and and prohibitory orders) on an as is where is basis and also on a lock stock and barrel basis upon the terms and subject to the conditions contained in the SPA. ZKP is the beneficial owner of all that parcel of building held under Strata Titles known as :- (i) Geran 71104/M1/B2/2, No. Petak 2, No. Tingkat B2, No. Bangunan M1; (ii) Geran 71104/M1/1/132, No. Petak 132, No. Tingkat 1, No. Bangunan M1, Petak Aksesori A5; and (iii) Geran 71104/M1/5/356, No. Petak 356, No. Tingkat 5, No. Bangunan M1, Petak Aksesori A2-A4, A7-A15 all located under the freehold land held under Lot 2028, Seksyen 4, Bandar Bukit Mertajam Sek. 4, Daerah Seberang Perai Tengah, Negeri Pulau Pinang, measuring approximately 14,967 square metres in area comprising of a hotel block of one hundred and sixty eight (168) hotel rooms bearing postal address known as Plaza Bukit Mertajam (The Summit), Jalan Arumugam Pillai, 14000 Bukit Mertajam, Pulau Pinang (hereinafter referred to as the Property ). It is to be noted that UDA Holdings Berhad ( UDA ) is the registered owner of the Property. However, pursuant to terms of a Development Agreement dated 31 December 1994 entered into between UDA and Zeus Development-Kumpulan Pinang JV Sdn Bhd ( Zeus ) ( Development Agreement ), in relation to which subsequently transferred and novated all its rights and obligations in favour of ZKP vide a Novation Agreement dated 1

30 January 1995 ( Novation Agreement ) and granted a power of attorney in favour of ZKP vide a Power of Attorney dated 9 May 2000 ( POA ), ZKP is the beneficial owner of the Properties. 2.2 Background Information on the Vendor ZKP was incorporated as a private company under the Companies Act, 1965 ( Act ) under the name of Orion Atur (M) Sdn Bhd on 16 August 1994. Subsequently, on 24 September 1994, it changed its name to ZKP. The principal activity of ZKP is that of property investment and the operation of a hotel and car park. As at 31 December 2016, ZKP had an issued and paid up capital of RM8,750,000 comprising 8,750,000 ordinary shares. The original cost of investment in ZKP of RM47.0 million was made by Meda on 28 December 2001. As at 31 December 2016, ZKP is a wholly-owned subsidiary of Meda. The Directors of ZKP are Dato Teoh Seng Kian and Dato (Dr.) Teoh Seng Foo. 2.3 Background Information on the Purchaser TMSB was incorporated in Malaysia under the Companies Act, 1965 on 8 April 2015 as a private limited company. TMSB is currently dormant. The issued and paid up share capital of TMSB as at 31 December 2016 is RM2.00 comprising of 2 ordinary shares. As at 31 December 2016, the Directors of TMSB are Dato Abd Rahman bin Harun and Mazlan bin Md Zain. TMSB is a wholly owned subsidiary of Aturan Prisma Sdn Bhd (Company No. 723460- P) ( APSB ). 2.4 Background Information on APSB APSB was incorporated in Malaysia under the Companies Act, 1965 on 13 February 2006 as a private limited company. APSB is engaged in construction and ancillary works. The issued and paid up share capital of APSB as at 31 December 2016 is RM5,000,000.00 comprising of 5,000,000 ordinary shares. As at 31 December 2016, the Directors and shareholders of APSB and their respective shareholdings in APSB are set out as follows : 2

<---------Direct--------> <---------Indirect--------> Name of Directors and No. of AP % No. of AP % shareholders Shares held Shares held Dato Abdul Rahman bin Harun 3,500,000 70 - - Mazlan bin Md Zain 1,500,000 30 - - Total 5,000,000 100 - - 2.5 Basis of Arriving At The Purchase Price The Purchase Price was arrived at on a willing-buyer willing-seller basis after taking into consideration the following :- i) The market value of RM13 million for the Property as ascribed by LaurelCap Sdn. Bhd. on 30 December 2016 after adopting the Comparison Approach and Income Approach; ii) The latest audited net book value of RM12,822,000 as at 31 December 2015; and iii) The Purchase Price represents a premium of approximately RM5,867,924 or 45.14% over the abovementioned market value of the Property of RM13,000,000. 2.6 Mode of Settlement of the Purchase Price The Purchase Price is proposed to be satisfied in accordance with the terms of the SPA, in the following manner :- Breakdown of payment Terms of payment RM 000 % Earnest Deposit Upon execution of the SPA 400 2 Balance Deposit (The Earnest Deposit and the Balance Deposit shall collectively be referred to as the Deposit ) Balance Purchase Price Balance Deposit to be paid within 14 days from the Date of Compliance Balance Purchase Price to be paid by Purchaser to Stakeholder Solicitors within 3 months from the Date of Compliance (hereinafter referred to as the Completion Date ) 1,600 8 18,000 90 TOTAL PURCHASE PRICE 20,000 100 3

2.7 Utilisation of Proceeds The net proceeds from the Proposed Disposal are estimated to be approximately RM18.27 million are intended to be utilized partially to fund working capital requirements for the Meda group to finance its day-to-day operations, including payment to creditors, such as contractors, consultants, administrative expenses, such as salaries and wages and other operating expenses, such as advertising and promotional activities. The actual utilization has not been determined at this juncture and may differ at the time of utilization. 2.8 Liabilities To be Assumed There are no liabilities, including contingent liabilities and guarantees, to be assumed by the Purchaser arising from the Proposed Disposal. 3. SALIENT TERMS OF THE SPA The salient terms of the SPA are as set out below :- i) The Proposed Disposal as set out in the SPA is conditional upon the Vendor obtaining the written approval and consent of the State Authority to the transfer of the Property in favour of the Purchaser (hereinafter referred to as the State Consent ) within a period of three (3) months from the date of the SPA (hereinafter referred to as the Approval Period ). ii) In the event the State Consent is not obtained within the Approval Period, the parties agree to grant to the other party such extension of time to be mutually agreed upon in writing between the parties or to terminate the SPA by giving notice to the other party and upon such termination :- a) the Vendor shall within fourteen (14) days from the date of the receipt of the notice of termination refund or cause to refund to the Purchaser the Ernest Deposit and all monies paid by the Purchaser under this SPA free of interest, failing which interest at the rate of eight per centum (8%) per annum calculated on daily basis shall be payable by the Vendor to the Purchaser on the amount due or such part thereof which is outstanding from the due date to the date of actual payment; b) the Purchaser shall withdraw the private caveat entered by the Purchaser (in the event it has been by the Purchaser); and c) the Stakeholder Solicitors ie Messrs Gan & Zul, Advocates & Solicitors, Level 30, Tower B, Vertical Business Suite, Avenue 3, Bangsar South, No. 8 Jln Kerinchi, 59200 Kuala Lumpur shall release and return the original title (if it has been deposited with the Stakeholder Solicitors) to the Vendor. 4

whereupon this Agreement shall become null and void and neither party shall have any claims against the other. iii) iv) The SPA shall cease to be conditional upon the Purchaser s solicitors receipt of a copy of the State Consent (hereinafter referred to as the Date of Compliance ). Completion of the SPA as set out in the SPA shall take place on a date falling within three (3) months from the Date of Compliance (hereinafter referred to as the Completion Date ). v) In the event that the Balance Purchase Price or any part thereof is not paid within the Completion Date the Vendor shall automatically grant to the Purchaser an extension of One (1) month from the expiry of the Completion Date (hereinafter referred to as the Extended Completion Date ) to pay the Balance Purchase Price provided that the Purchaser shall pay to the Vendor interest at the rate of eight per centum (8%) per annum on the amount of the Balance Purchase Price remaining outstanding at the expiry of the Completion Date (hereinafter referred to as the said Interest ). vi) In the event that the Purchaser shall fail to pay the Balance Purchase Price and the said Interest (if any) in accordance with the provisions of this SPA or in the event of any material breach by the Purchaser of any of the provisions of this SPA not capable of being remedied within fourteen (14) days from the date of receipt of a written notice of such breach, the Vendor shall be entitled at the cost and expense of the Purchaser and at the Vendor's sole discretion to terminate this SPA by written notice from the Vendor to the Purchaser in which event:- a) the Vendor shall be entitled to forfeit the Deposit as agreed liquidated damages; b) the Purchaser shall forthwith re-deliver vacant possession of the Property to the Vendor (if it has already been delivered to the Purchaser) with the condition and state of the Property (hereinafter referred to as Original Condition ) [save for fair wear and tear] at the Purchaser's own cost and expense; c) the Stakeholder Solicitors are authorised to present the valid and registrable withdrawal of the private caveats duly executed by the Purchaser and/or the financial institution ( Financier ) for registration (in the event such private caveats have been entered by the Purchaser and/or the Financier, as the case may be, on the Property); and d) the Purchaser shall forthwith return to the Vendor all documents (including but not limited to the transfer document after cancellation and refund of ad valorem stamp duty paid thereon) with the Vendor s interest in the Property intact and as delivered by the Vendor under the provisions of this SPA; in exchange for the refund by the Vendor to the Purchaser and/or the Financier, as the case may be, of all monies (save and except for the Deposit) paid towards the 5

account of the Purchase Price pursuant to the provisions of this SPA without any interest whereupon this SPA shall terminate and cease to be of any further effect but without prejudice to any rights which the Vendor may be entitled in respect of any antecedent breach by the Purchaser of this SPA and the Vendor shall be free to deal with the Property in whatsoever manner as he may as the absolute and unencumbered owner deem fit, free of the Purchaser's interest therein. vii) In the event of any material breach by the Vendor of any of the provisions of this SPA not capable of being remedied within fourteen (14) days from the date of receipt of a written notice of such breach and/or the Vendor refusing or failing to transfer the Property to the Purchaser free from all encumbrances with vacant possession in accordance with the provisions of this SPA, then it is hereby agreed between the parties hereto that the Purchaser shall be entitled at the cost and expense of the Vendor to the following remedies:- a) specific performance of this SPA against the Vendor and all relief resulting there from and to recover from the Vendor all costs (including the Purchaser's solicitors' fees on a solicitor and client basis) incurred by the Purchaser in respect thereof; or b) to terminate this SPA by written notice from the Purchaser to the Vendor whereby the Vendor shall forthwith refund all monies without interest to the Purchaser and/or the Financier, as the case may be, and pay to the Purchaser a sum equivalent to the Deposit only as agreed liquidated damages, and in exchange whereof the Purchaser shall forthwith:- (i) (ii) re-deliver vacant possession of the Property to the Vendor (if it has already been delivered to the Purchaser) in its Original Condition [save for fair wear and tear] at the Vendor's own cost and expense; the Stakeholder Solicitors are authorised to present the valid and registrable withdrawal of the private caveats duly executed by the Purchaser and/or the Financier for registration (in the event such private caveats have been entered by the Purchaser and/or the Financier, as the case may be, on the Property); and (iii) return to the Vendor all documents (including but not limited to the transfer document after cancellation and refund of ad valorem stamp duty paid thereon) with the Vendor s interest in the Property intact and as delivered by the Vendor under the provisions of this SPA; whereupon this SPA shall terminate and cease to be of any further effect but without prejudice to any rights which the Purchaser may be entitled in respect of any antecedent breach by the Vendor of this SPA and the Vendor shall be free to deal with the Property in whatsoever manner as he may as the absolute and unencumbered owner deem fit, free of the Purchaser's interest therein. 6

4. RATIONALE FOR THE PROPOSED DISPOSAL The rationales for the Proposed Disposal are as set out below :- a) part of Meda on-going re-organization exercise to redeploy the group s resources to a more efficient areas as well as to enable Meda to realise its ultimate objective to enhance shareholders value and returns in future; b) to dispose the low-revenue generating asset and to monetize its investment in ZKP for cash at a price that is a premium over its net book value to allow Meda to realise cash and to reinvest the capital into Meda s core business activity; c) to raise additional funds to pursue other opportunities within the property development industry; and d) the aging Property of approximately 15 years with its current physical condition warrants refurbishment works to be carried on the Property to ensure that the Property remain competitive. Such asset enhancement initiatives require significant financial resources and may not yield reasonable return given the limited upside for the future growth of the Property. 5. EFFECTS OF THE PROPOSED DISPOSAL 5.1 Share Capital and substantial shareholders shareholding The Proposed Disposal will not have any effect on the issued and paid-up share capital and substantial shareholders shareholdings of Meda as the Proposed Disposal does not involve any issue of new Meda Shares. 5.2 Net Assets and net assets per share and gearing Based on the unaudited results of the Meda group as at 31 December 2016 which has been reviewed by Meda s external auditors, the effects of the Proposed Disposal on the net assets, net assets per share and gearing ratio of Meda group are as follows :- Unaudited results as at 31 December 2016 RM'000 Effect After Proposed Disposal RM'000 Share Capital 246,278 246,278 Share premium 14,954 14,954 Revaluation reserve 6,054 6,054 Accumulated losses (117,168) (111,122) Net Assets 150,118 156,164 Total Borrowing 67,910 67,910 Gearing 0.45 0.43 7

Based on the proforma consolidated statement of financial position of the Meda group as at 31 December 2016, the total borrowings of the group remain unchanged while the gearing ratio will be reduced from 0.45 times to 0.43 times. 5.3 Earnings and earnings per share The Proposed Disposal will result in the Meda group realising a gain of RM 6,045,924. 5.4 Convertible Securities As at 31 December 2016, save for the following, the Company does not have any outstanding convertible securities: (i) (ii) (iii) 51,949,500 outstanding warrants 2011/2021 ( Warrant A ) which were issued on 16 August 2011 and expiring on 15 August 2021 with an exercise price of RM0.50 per Warrant A; 96,457,766 outstanding warrants 2012/2022 ( Warrant B ) which were issued on 24 April 2012, listed on 3 May 2012 and expiring on 23 April 2022 with a step-up exercise price mechanism whereby the base exercise price of RM0.60 for each Warrant B is adjusted upwards by RM0.10 at the expiry of every 2 anniversary years from 24 April 2012 in accordance with the memorandum of the deed poll constituting the Warrants B; and 48,421,408 outstanding warrants 2014/2024 ( Warrant C ) which were issued on 25 August 2014 and expiring on 24 August 2024 with an exercise price of RM0.80 per Warrant C. 6. RISKS FACTORS The potential risk factors relating to the Proposed Disposal are as follows :- 6.1 Failure / Delay in the Completion of the Proposed Disposal The completion of the Proposed Disposal is conditional upon the conditions precedent being satisfied in accordance with the provisions of the SPA. There is no assurance that all such conditions precedent will be satisfied. Notwithstanding this, the Board will take reasonable steps to ensure that the conditions precedent are met in order to complete the Proposed Disposal in a timely manner. 6.2 Loss of potential income from hotel operation Loss of potential future income from hotel operation. For the financial year ended (hereinafter referred to as FYE ) 31 December 2015, the revenue from hotel operation was RM3.79 million, representing 4.42% of the audited consolidated revenue of the Meda group. 8

Upon the completion of the Proposed Disposal, the hotel segment of ZKP will cease to contribute to the future revenue and profit of the Meda Group. The Meda group will, however, continue to be involved in property development through its other existing business operations. Nonetheless, the revenue contribution from the hotel operation during the FYE 31 December 2015 was not material. 6.3 Financial or legal risks Meda may be subject to certain financial or legal risks pursuant to the SPA or any related documents executed. Meda may also be subjected to contractual risks as a result of nonfulfilment of its obligations under the SPA. In this respect, Meda endeavours to ensure full compliance in relation to fulfilment of its obligations under the SPA. 7. APPROVALS REQUIRED To the best knowledge of the Board, the Proposed Disposal does not trigger any requirements that would subject the Proposed Disposal to any approvals by the relevant authorities or the shareholders of Meda. 8. INTEREST OF DIRECTORS, MAJOR SHAREHOLDERS AND/OR PERSONS CONNECTED None of the Directors, major shareholders of Meda and/or persons connected to them, as defined in the Main Market Listing Requirements of Bursa Malaysia Securities Bhd ( Bursa Securities ), has any interest, direct or indirect, in the Proposed Disposal. 9. HIGHEST PERCENTAGE RATIO The highest percentage ratio applicable to the Proposed Disposal pursuant to Paragraph 10.02(g) of the Listing Requirements is 12.07% computed based on the latest audited financial statements of the Company for the financial year ended 31 December 2015. In this regard, Meda is required to make announcement to Bursa Securities. 10. DIRECTOR S RECOMMENDATION Having considered and deliberated all the relevant aspects of the Proposed Disposal, including but not limited to the rationales for the Proposed Disposal, the proposed utilisation of proceeds arising from the Proposed Disposal, the proforma financial effects of the Proposed Disposal, the Board is of the opinion that the Proposed Disposal is: (i) in the best interests of the Meda group; (ii) fair, reasonable and on normal commercial terms; and (iii) not detrimental to the interest of the shareholders of Meda. 9

11. ESTIMATED TIMEFRAME FOR COMPLETION Barring any unforeseen circumstances and subject to the fulfilment of the condition as set out in the SPA, the Directors expect the Proposed Disposal to be completed by early of third quarter 2017. 12. DOCUMENTS FOR INSPECTION A copy of the SPA is available for inspection at the registered office of Meda at No. C- 07-01, Capital 3, Oasis Square, No. 2, Jalan PJU 1A/7A, 47301 Petaling Jaya, Selangor Darul Ehsan, Malaysia during normal office hours from Monday to Friday (except public holidays) for a period of three (3) months from the date of this announcement. This Announcement is dated 20 April 2017. 10