JADE MARVEL GROUP BERHAD (FORMERLY KNOWN AS JMR CONGLOMERATION BHD)

(“JMGB” OR “COMPANY”)

- JOINT VENTURE AGREEMENT BETWEEN GREAT MARVEL SDN BHD AND JSC LAND
DEVELOPMENT SDN BHD IN RELATION TO THE DEVELOPMENT PROJECT AT
SIMPANG AMPAT.

1. INTRODUCTION

The Board of Directors of JMGB (“Board”) wishes to announce that Great Marvel Sdn Bhd
(“GMSB”), a wholly owned subsidiary of JMGB, had on 1st November 2019 entered into a joint
venture agreement (“JVA”) with JSC Land Development Sdn Bhd (“JSC”).

Further details on the Joint Venture are set out in the ensuing sections of this announcement.

2. INFORMATION ON JOINT VENTURE PARTIES

2.1 Information on GMSB

GMSB was incorporated in Malaysia on 1 July 2009 as a private company limited by shares
under the Companies Act, 1965. GMSB is a wholly-owned subsidiary of JMGB. GMSB is
principally involved in property development activities.

The directors and shareholder of GMSB are as set out below:-

Shareholding
Directors and shareholder No. of Shares %

Directors
Dennis Chung Vui Ming - -
Dato’ Ir Dr Goh Yong Chee - -
Lim Tze Ming - -

Shareholder
Jade Marvel Group Berhad 2,500,002 100

2.2 Information on JSC

JSC was incorporated in Malaysia on 18 September 2019 as a private company limited by

shares under the Companies Act, 2016 with an issued share capital of RM500,000 comprising
of 500,000 ordinary shares. The principal activities of JSC are to design, construct, erect,
layout, improve, maintain, develop, manage or control; and premises acquired by or in which
the company is interested and in particular preparing the same for development.

The director and shareholders of JSC are as set out below:-

Shareholding
Director and shareholders No. of Shares %

Director
Choong Seng Chang 450,000 90

Shareholders
Choong Seng Chang 450,000 90
Adeline Ng Mei Mei 50,000 10

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3. INFORMATION ON THE PROJECT

3.1 Details of the Land

Under the JVA, both parties will jointly develop a parcel of freehold land at Lot No. 20394,
Mukim 14, Daerah Seberang Perai Selatan, Simpang Ampat, Penang measuring approximately
6.17 acres, prior to subdivision and which has since been subdivided into ninety six (96)
individual issue documents of title (“the Land”) owned by GMSB, into a residential housing
development called “Casa Perdana” (“Development Project”) which includes inter alia double
storey terrace link houses and semi-detached houses. The said Land is part of a total of
approximately 33 acres of undeveloped freehold land at Simpang Ampat.

3.2 Details of the Development Project

The gross development value (“GDV”) of the Development Project is estimated to be up to

RM50 million, based on the plan submission by GMSB for the time being. The obligation of
the parties under this JVA shall continue for a duration of thirty six (36) months.

Pursuant to the JVA, GMSB shall be entitled to receive from JSC a sum of RM14.78 million
in cash and/or by way of contra of house units within thirty six (36) months from the date of
the JVA with the first payment of RM1 million receivable upon execution of the JVA.

4. DETAILS OF THE JOINT VENTURE AGREEMENT

4.1 Salient Terms of the JVA

4.1.1 JSC shall have its own costs and expenses to carry out and complete the Development
Project with Certificate of Fitness, including the pre-operating costs and all
development charges and fees in relation to the layout and building plans approvals.

4.1.2 The completion of the Development Project together with the infrastructure and
Amenities with the issuance of the Certificate of Fitness shall not be later than thirty
six (36) months from the date of the JVA save and except if the period is extended by
the mutual consent of both parties subject to such terms and conditions to be mutually
agreed.

4.1.3 GMSB shall execute a limited power of attorney in favour of JSC to implement the
Development Project upon signing of the JVA.

4.1.4 GMSB’s covenants and representations

4.1.4.1 GMSB undertakes and represents to JSC:-

(a) to sign within such reasonable period of time but which shall not exceed
seven (7) days, all applications, plans and other documents as may be
necessary to be signed to secure the approval of the Appropriate Authorities
to carry out and complete the Development Project;

(b) to allow JSC to develop the Development Project on the parcels of Land
pursuant to the terms and conditions herein contained;

(c) to facilitate the Development Project, GMSB shall and hereby grants to JSC,
its servants, agents, licensees, invitees and contractors (with or without
vehicles) at all times hereafter and for all purposes directly related to the
Development Project, the right to pass and repass along and over the
Development Project immediately upon the signing of the JVA and subject
to the payment by JSC to GMSB pursuant to Section 3.2 cleared funds.

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 4.1.4.2 GMSB covenants that it has obtained from the Appropriate Authority the
planning approval for the residential housing of the Development Project
upon such terms and conditions of the Appropriate Authority as
made known to the JSC prior to the execution of the JVA.

4.1.5 JSC undertakings

(a) it has the legal capacity, right, power and authority to enter into the JVA and
to execute all document and perform all other acts as may be necessary to
satisfy its obligation hereunder;

(b) it shall not assign the JVA or any part thereof to any third party without the
prior written consent of GMSB;

(c) it shall construct in a good and workmanlike manner the units in the
Development Project in accordance with the approved layout and building
plans;

(d) it shall be solely responsible for all costs and expenses to develop the
Development Project, working capital and shall likewise be solely
responsible for the supply of materials, labour force, workmen’s
compensation insurance, all accident and other insurance, and contributions
to the Employees Provident Fund for the construction and completion of the
Project together with the Infrastructure and Amenities up to the issuance of
the Certificate of Fitness and the expiry of the defect liability period in
relation to the houses developed on the Development Project;

(e) to complete the Development Project and undertake to obtain the Certificate
of Fitness within thirty six (36) months from the date of the JVA save and
except as extended by the mutual consent of both parties hereto in writing;
and

(f) to be responsible for all sales administration of the Development Project up

to the issuance of the Certificate of Fitness and the expiry of the defect
liability period in relation to the houses developed on the Development
Project.

4.1.6 In the event that any of the payments stipulated in Section 3.2 of this announcement
payable to GMSB or any part thereof shall remain unpaid after becoming payable
(whether formally demanded or not), without prejudice to the GMSB's right, it is
hereby agreed the JSC is given a grace period of three (3) months to pay such sums
subject to late payment interest at the rate of eight per cent (8%) per annum on a day
to day basis being payable by JSC on such outstanding monies calculated from the
date such monies fall due for payment to the date of actual payment without prejudice
to GMSB’s right to terminate the JVA upon expiry of the said grace period.

4.1.7 Termination

4.1.7.1 If:-

(a) either party is in breach of or fails to observe or perform any of its covenants
and obligations hereunder and has failed to remedy such breach or failure
within reasonable time not exceeding thirty (30) days after receipt of a notice
by the other party to that effect; or

(b) if any representation, warranty or undertaking made by either party in or

pursuant to the JVA is incorrect in any material respect; or

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(c) an order is made, an effective resolution passed or legislation enacted for the
winding up (other than a voluntary winding up for the purpose of
reconstruction or amalgamation) of either party or if a receiver and/or
manager is appointed of the undertaking or part thereof of either party; or

(d) either party is unable to pay its debts within the meaning of Section 466 of
the Companies Act 2016 or stops payment of its debts generally or
commences negotiations with its creditors with a view to a general
readjustment or rescheduling of its debts or compounds or enters into any
arrangement with or makes any assignment for the benefit of its creditors or
attempts to do any of the foregoing (except as part of or pursuant to a
scheme of reconstruction or amalgamation); or

(e) if a distress or execution or other process of a court of competent jurisdiction

be levied upon or issued against property of either party and such distress,
execution or other process as the case may be is not satisfied or challenged
bona fide by such party within seven (7) days from the date thereof; or

(f) at any time before the issuance of the Certificate of Fitness of the
Development Project, the whole of the Development Project is suspended by
the JSC for a continuous period of ninety (90) days or abandoned;

4.1.7.2 In the event of a breach by JSC

GMSB shall be entitled to forfeit the payment made by JSC under Section
3.2 hereto and all other monies paid by JSC to GMSB towards the GMSB’s
entitlement, as a liquidated sum of damages and not as a penalty, and JSC
hereby undertakes with GMSB that JSC shall forthwith comply with the
following:-

(a) to revoke the limited power of attorney granted by GMSB to JSC in

accordance to the terms and conditions herein;

(b) to return vacant possession of the Land to GMSB with GMSB’s interest
intact and free from any squatters, including but not limited to the
removal of the contractors, employees, workers, sub-contractors and all
persons whatsoever from the Land and the Development Project;

(c) to return to GMSB all original documents of GMSB in relation to the

Land, the Development Project with the GMSB’s interest intact;

(d) to cause all consultants to be discharged and to secure a letter from the
respective consultants addressed to GMSB and the Appropriate
Authorities confirming that they are discharged from the Development
Project and further that there are no fees or monies whatsoever due to
them respectively; and

(e) JSC shall undertake that GMSB shall not be required to compensate
JSC for any improvements or enhancement made to the Land and the
Development Project; and GMSB shall be fully and legally entitled to
all for any improvements or enhancement made to the Land and the
Development Project, subject to GMSB being agreeable to reimburse to
JSC a discounted sum of all actual construction costs only incurred on
the Land by JSC (if any), as certified by a quantity surveyor appointed
by GMSB less any sums due to JSC’s contractor (if any), damages,
expenses, penalties, fines, late payment interests, late delivery charges
and all other expenses whatsoever as may be suffered and/or incurred by
GMSB for reviving the Development Project (hereinafter referred to as
"the Reimbursement Sum"). JSC hereby agrees that the GMSB shall

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 only be liable to repay the Reimbursement Sum to JSC either by way of
cash or contra units within the Project subject to JSC having redelivered
vacant possession of the Land to GMSB within ninety (90) days of such
termination and further subject to the completion of the Development
Project by GMSB or such third party with the issuance of the Certificate
of Fitness for the Development Project.

4.1.7.3 In the event of a breach by GMSB

GMSB hereby agrees that JSC shall be entitled to the remedy of specific
performance of the JVA and all costs and expenses incurred by JSC in
connection therewith in bringing such action shall be borne and paid by
GMSB.

5. RATIONALE FOR THE JOINT VENTURE

The Joint Venture is in line with JMGB Group’s strategy to grow its property development segment
through strategic partnership.

6. RISKS FOR THE JOINT VENTURE

The risks associated with the transaction in connection with the Joint Venture will be subject to market
risk, industry risk, commercial contract risk and also economy risk which may affect the property
development industry. Nevertheless, the Board believes that the Development Project located at a
strategic location shall have the advantages of mitigating the said risks.

7. EFFECTS OF THE JOINT VENTURE

7.1 Share Capital and Substantial Shareholders’ Shareholding

The Joint Venture will not have any effect on the share capital of JMGB and substantial
shareholders’ shareholding in JMGB as it does not involve any allotment or issuance of new
shares by JMGB.

7.2 Net Assets and Gearing

The Joint Venture is not expected to give rise to any material effect on the net assets and
gearing of the Company for the coming financial year ending 31 March 2020.

7.3 Earnings and Earnings Per Share (“EPS”)

Pending finalisation of the development plan for the Development Project, the Joint Venture is
not expected to have any material effect on the earnings of the Company for the coming
financial year ending 31 March 2020.

8. APPROVALS REQUIRED

The Joint Venture is not subject to approval of shareholders of the Company and any regulatory
authorities.

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9. INTERESTS OF DIRECTOR AND MAJOR SHAREHOLDER AND PERSONS CONNECTED
WITH THEM

None of the Directors and/or major shareholders of JMGB and/or persons connected to them have any
interest, whether direct or indirect, in the Joint Venture.

10. STATEMENT OF DIRECTORS

The Board having taken into consideration all aspects of the Joint Venture, is of the opinion that the
Joint Venture is in the best interest of the JMGB Group.

11. HIGHEST PERCENTAGE RATIO

The highest percentage ratio applicable to the Joint Venture pursuant to Paragraph 10.02(g) of the Main
Market Listing Requirements of Bursa Malaysia Securities Berhad (“Listing Requirements”) is
approximately 15.46% based on JMGB’s latest audited consolidated financial statements for the
financial year ended 31 March 2019.

12. DOCUMENTS FOR INSPECTION

A copy of the JVA will be made available for inspection at the Company's Registered Office at 39,
Salween Road, 10050 Penang during normal business 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 1 November 2019.