LBS Bina Perpetual Sukuk RM700 Million - Principal Terms and Conditions

Transcription

1. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions (A) CORPORATE INFORMATION OF ISSUER (1) Name : LBS Bina Group Berhad (“LBS Bina” or the “Issuer”) (2) Address : Registered Address: Plaza Seri Setia, Level 1-4, No. 1, Jalan SS9/2, 47300 Petaling Jaya, Selangor. Business Address: Plaza Seri Setia, Level 1-4, No. 1, Jalan SS9/2, 47300 Petaling Jaya, Selangor. (3) Date of incorporation: 29 June 2000 (4) Place of incorporation Malaysia : (5) Business registration: number 200001015875 (518482-H) (6) Residence status : Resident Controlled Company (7) Place of listing : Bursa Malaysia (8) Date of listing : 30 January 2002 (9) Principal activities : The principal activities of the Issuer are the provision of management services and investment holding. (10) Issued and paid-up : share capital The issued and paid-up share capital of the Issuer as at 30 November 2019 are as follows:Issued and fully paid-up share capital RM817,569,428.90 comprising 1,567,111,011 ordinary shares (including 19,510,400 treasury shares). (11) Structure of : shareholdings and names of shareholders or, in the case of a public company, names of all substantial shareholders The substantial shareholders (5% shareholding and above) and their shareholdings in the Issuer as at 30 November 2019 are as follows:- Shareholders Gaterich Sdn Bhd Direct Indirect No. of Shares % of Issued No. of Shares % of Issued Held Shares Held Shares 646,234,954 41.76 - Printed on : 03/03/2020 19:17 Page 1 of 34
2. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions Tan Sri Lim Hock San, JP Datuk Wira Lim Hock Guan, JP Kumpulan Wang Persaraan (diperbadankan) 30,398,559 1.96 646,234,954* 41.76* 27,311,111 1.76 646,234,954* 41.76* 126,229,540 8.16 48,827,540^ 3.16^ Notes: * Deemed interested by virtue of his substantial shareholdings in Gaterich Sdn Bhd pursuant to Section 8 of the Companies Act 2016 ^ Deemed interested by virtue of shares held by fund managers of Kumpulan Wang Persaraan (diperbadankan) (12) Board of directors (13) Disclosure of the following (i) : No. Name 1 Dato’ Seri Lim Bock Seng 2 Tan Sri Lim Hock San, JP 3 Datuk Wira Lim Hock Guan, JP 4 Maj (Hon) Dato’ Sri Lim Hock Sing, JP 5 Dato’ Sri Lim Hock Seong 6 Dato’ Chia Lok Yuen 7 Dato’ Lim Mooi Pang 8 Lim Tong Lee 9 Datuk Dr Haji Baharum bin Haji Mohamed 10 Datuk Lim Si Cheng : If the issuer or : its board members have been convicted or charged with No. Printed on : 03/03/2020 19:17 Page 2 of 34
3. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions any offence under any securities laws, corporation laws or other laws involving fraud or dishonesty in a court of law, or if any action has been initiated against the issuer or its board members for breaches of the same, for the past ten years prior to the lodgement/ since incorporation (for issuer incorporated less than ten years) (ii) If the issuer has : been subjected to any action by the stock exchange for any breach of the listing requirements or rules issued by the stock exchange, for the past five years prior to the lodgement No. (B) PARTIES TO THE TRANSACTION (a) Origination No. Roles Name of parties 1 Issuer LBS Bina 2 Principal Adviser RHB Investment Bank Berhad Printed on : 03/03/2020 19:17 Page 3 of 34
4. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions 3 Lead Arranger RHB Investment Bank Berhad (the “Lead Arranger”) 4 Solicitors Messrs. Adnan Sundra & Low 5 Shariah Adviser RHB Islamic Bank Berhad 6 Sukuk Trustee Malaysian Trustees Berhad (“MTB”) 7 Security Trustee MTB 8 Facility Agent RHB Investment Bank Berhad (b) At the point of distribution No. Roles Name of parties 1 Issuer LBS Bina 2 Facility Agent RHB Investment Bank Berhad 3 Lead Manager RHB Investment Bank Berhad (the “Lead Manager”) 4 Central Depository Bank Negara Malaysia (“BNM”) 5 Paying Agent BNM (c) After distribution No. Roles Name of parties 1 Issuer LBS Bina 2 Principal Adviser RHB Investment Bank Berhad 3 Facility Agent RHB Investment Bank Berhad 4 Sukuk Trustee MTB 5 Security Trustee MTB Printed on : 03/03/2020 19:17 Page 4 of 34
5. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions 6 Central Depository BNM 7 Paying Agent BNM 8 Shariah Adviser RHB Islamic Bank Berhad (C) DETAILS OF FACILITY/PROGRAMME (1) Name of facility : Perpetual Sukuk Musharakah Programme (2) One-time issue or programme : Programme (3) Shariah principles (for sukuk) : 1. Musharakah (Profit and loss sharing) Additional Notes: (4) Facility description : (for ringgitdenominated sukuk, to provide description as cleared by the SC) A perpetual Islamic notes issuance programme for the issuance of unrated perpetual Islamic notes (“Perpetual Sukuk Musharakah”) of up to RM700.0 million in nominal value based on the Shariah principle of Musharakah (“Perpetual Sukuk Musharakah Programme”). The Perpetual Sukuk Musharakah to be issued under the Perpetual Sukuk Musharakah Programme shall be issued as follows: (a) the Perpetual Sukuk Musharakah may be issued in one or more series. Each series may be secured or unsecured and if a series is secured, all Perpetual Sukuk Musharakah issued under that series shall be secured by the same Series Security (as defined below). Each issuance of Perpetual Sukuk Musharakah with the same Secured Properties (as defined in the section entitled “Details of security/collateral pledged, if applicable”) shall be referred to as a “Series”. For the avoidance of doubt, each secured Series shall be secured by different Secured Properties; and (b) each Series may comprise one or more “tranche” with different issue dates and different First Call Dates (as defined in the section entitled “Other terms and conditions – Periodic Distribution Rate”). Each Perpetual Sukuk Musharakah issued with the same issue date, same First Call Date and identical terms and conditions shall be referred to as a “Tranche”. Any issuance of Perpetual Sukuk Musharakah subsequent to the first Tranche of the Perpetual Sukuk Musharakah under the relevant Series shall not require the consent of the holders of the outstanding Perpetual Sukuk Musharakah (“Sukukholders”) issued under that Series and such Sukukholders shall be deemed to have consented to the issuance of subsequent Perpetual Sukuk Printed on : 03/03/2020 19:17 Page 5 of 34
6. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions Musharakah under that Series and for such Perpetual Sukuk Musharakah to be equally secured by the same security of that Series on a pari passu basis in point of priority and security. The specific terms of each Tranche will be set out in a pricing supplement (“Pricing Supplement”) to be agreed between the Issuer and the Lead Manager(s) of the Perpetual Sukuk Musharakah Programme and/or the relevant Sukukholder(s) of that Tranche and shall be issued prior to the issuance of each Tranche of the Perpetual Sukuk Musharakah. The Pricing Supplement will, amongst others, set out the Secured Properties (if applicable), the Series Security (as defined herein) (if applicable) and the Escrow Account (as described in the section entitled “Details of designated account(s), if applicable”) (if applicable) in respect of each Tranche and this shall apply to all Tranches of Perpetual Sukuk Musharakah issued under the said Series under the Perpetual Sukuk Musharakah Programme. The Pricing Supplement in respect of each Tranche, will be posted or uploaded onto the Fully Automated System for Issuing/Tendering (“FAST”) (or such other system in addition, alternate or substitution thereof in relation to the Perpetual Sukuk Musharakah) prior to the issuance of each Tranche of Perpetual Sukuk Musharakah under that Series. The Perpetual Sukuk Musharakah comprise certificates representing undivided beneficial interest in the Musharakah Venture (as defined below) and any funds held by the Manager (as defined below) on account of holders of the Perpetual Sukuk Musharakah (“Sukukholders”). A description of the structure and summary of the principal Islamic documents are set out below. Underlying Transaction Master Musharakah Agreement The Sukuk Trustee (on behalf of the Sukukholders) and LBS Bina Group Berhad (“LBS Bina” or the “Issuer”) shall enter into a master Musharakah agreement (the “Master Musharakah Agreement”) under which, the parties as partners (each a "Partner" and collectively the "Musharakah Partners") may, from time to time, enter into Musharakah agreements (each a “Musharakah Agreement”) for the purposes of undertaking a venture (the “Musharakah Venture”) consisting of Shariah-compliant investments in the business operations of the Issuer and/or its subsidiaries or part thereof identified and held on trust by LBS Bina on behalf of the Sukukholders (“Business”) which shall be identified prior to the issuance of the Perpetual Sukuk Musharakah. The Issuer shall issue the Perpetual Sukuk Musharakah to the Sukukholders from time to time and the Sukukholders shall participate in the Musharakah Venture via subscription of the Perpetual Sukuk Musharakah issued by the Issuer. The Perpetual Sukuk Musharakah shall represent the respective Sukukholders' undivided proportionate interest in the Musharakah Venture and any funds held on account of the Sukukholders. The capital contribution of the Sukukholders (“Musharakah Capital”) to the Musharakah Venture shall be the proceeds raised from the Perpetual Sukuk Musharakah while LBS Bina contribute the Business as a capital contribution inkind to the Musharakah Venture. Simultaneously, the Issuer shall make a declaration that it holds on trust the Musharakah Partners' interest in the Business for the benefit of the Sukukholder(s) and itself pursuant to the Musharakah Venture. For the avoidance of doubt, the value of the Business shall be valued at the point of issuance based on net book value, market value or such other valuation methods acceptable to the Shariah Adviser. Printed on : 03/03/2020 19:17 Page 6 of 34
7. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions The Sukukholder(s) shall appoint the Issuer as the manager to manage the Musharakah Venture (“Manager”). Income from the Musharakah Venture shall be distributed to each Partner based on a profit sharing ratio of 95:5 (Sukukholder(s):Issuer). Any losses incurred in the Musharakah Venture shall be borne by each Partner in proportion to each Partner’s respective capital contribution in the Musharakah Venture. Each Musharakah Agreement will contain the terms for the expected periodic distributions from that Musharakah Venture for each agreed period (each a “Distribution Period”). The expected periodic distribution amount (“Expected Periodic Distribution Amount”) on any relevant Periodic Distribution Date (as defined in the section entitled “Other terms and conditions - Periodic Distribution Frequency”) is calculated at the prevailing Periodic Distribution Rate (as defined in the section entitled “Other terms and conditions – Periodic Distribution Rate”) on the nominal value of the relevant Tranche (as defined in the section entitled “Other terms and conditions – Periodic Distribution Rate”) of the Perpetual Sukuk Musharakah. Should the Issuer decide to dissolve or dispose of the Business from time to time throughout the tenure of the Perpetual Sukuk Musharakah, the Manager shall substitute the Business with a new business that is Shariah-compliant and approved by the Shariah Adviser via a substitution agreement to be entered between the Manager and the Sukuk Trustee (on behalf of the Sukukholders). For the avoidance of doubt, the Business of the existing Musharakah Venture shall be substituted with a different Business which is of at least equal value to the Business of such existing Musharakah Venture being replaced. Under the relevant Musharakah Venture, the Sukukholders have agreed upfront that they shall receive income generated from the relevant Musharakah Venture up to the aggregate Expected Periodic Distribution Amount. Any excess income from the relevant Musharakah Venture shall be retained by the Manager as a reserve (“Reserve”) on behalf of the Sukukholders which may be utilised by the Manager, from time to time for its own purposes provided that the Manager shall be required to re-credit such amount when (a) there is a Shortfall (as defined below) and to the extent required of such Shortfall; and (b) upon the dissolution of the relevant Musharakah Venture pursuant to the Redemption Events (as defined in the section entitled “Call options and details, if applicable”) and/or Enforcement Events (as defined in the section entitled “Events of default or enforcement events, where applicable, including recourse available to investors”). Upon dissolution of the relevant Musharakah Venture pursuant to the Redemption Events and/or Enforcement Events, if there is a positive balance in the Reserve, such amount in the Reserve shall be given to the Manager as an incentive fee. In the event the income generated is insufficient to pay the Expected Periodic Distribution Amount, the Manager (i) shall utilise any amount available in the Reserve to cover the shortfall between such Expected Periodic Distribution Amount and the income generated (“Shortfall”) and (ii) may at its sole discretion provide a Shariah-compliant liquidity facility whereby it shall advance to the Sukuk Trustee (on behalf of the Sukukholders) an amount sufficient to make up the Shortfall (adjusted accordingly pursuant to any utilisation of the Reserve as referred to in (i) above, if applicable) in order to enable the Issuer to make payment in full of the said Expected Periodic Distribution Amount. Any amount of liquidity facility advanced by the Manager to the Sukuk Trustee (on behalf of the Sukukholders) throughout the tenure of the Perpetual Sukuk Musharakah shall be repaid to the Manager upon redemption of the Perpetual Sukuk Musharakah in full and such amount to be repaid shall be referred to as the “Liquidity Facility”. Printed on : 03/03/2020 19:17 Page 7 of 34
8. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions Periodic Distribution Deferral The Sukukholders agree that LBS Bina may at its sole discretion (unless a Compulsory Periodic Distribution Payment Event (as defined in the section entitled “Other terms and conditions – Periodic Distribution Deferral”) has occurred) elect to make payment of all or some of the Expected Periodic Distribution Amount (such Expected Periodic Distribution Amount being deferred shall constitute the “Arrears of Deferred Periodic Distribution”) on the Periodic Distribution Date or elect to defer all or some of such payment by giving an optional deferral notice (“Optional Deferral Notice”) to the Facility Agent and the Sukuk Trustee (for and on behalf of the Sukukholders) not less than fifteen (15) days and not more than thirty (30) days prior to the relevant Periodic Distribution Date. Each amount of Arrears of Deferred Periodic Distribution shall itself be entitled to Expected Periodic Distribution Amounts (as the deferred Expected Periodic Distribution Amount will form part of the Sukukholders’ Musharakah Capital) at the prevailing Periodic Distribution Rate and the amount of such Expected Periodic Distribution Amount (the "Additional Periodic Distribution Amount") with respect to Arrears of Deferred Periodic Distribution shall be payable pursuant to this paragraph. The Additional Periodic Distribution Amount shall be calculated by applying the then prevailing Periodic Distribution Rate to the Arrears of Deferred Periodic Distribution and otherwise mutatis mutandis as provided in the foregoing provisions of this paragraph. The Additional Periodic Distribution Amount accrued up to any Periodic Distribution Date shall be added for the purpose of calculating the Additional Periodic Distribution Amount accruing thereafter, to the amount of Arrears of Deferred Periodic Distribution remaining unpaid on such Periodic Distribution Date so that it will itself become Arrears of Deferred Periodic Distribution. Partial or Full Deferral (a) Income from Musharakah Venture equal to or in excess of Expected Periodic Distribution Amount If there is sufficient income generated from the relevant Musharakah Venture to satisfy the payment of such part of or all of the relevant Expected Periodic Distribution Amount being deferred which would otherwise become due and payable under the Perpetual Sukuk Musharakah, under the relevant Musharakah Agreement, the Sukukholders irrevocably authorise the Manager to reinvest the income generated from the relevant Musharakah Venture up to the value of such Expected Periodic Distribution Amount being deferred pursuant to the Optional Deferral (as outlined in the section entitled “Other terms and conditions - Periodic Distribution Deferral”) into the existing Musharakah Venture as additional capital from the Sukukholders (“Additional Capital”). For the avoidance of doubt, any reinvestment shall not increase the nominal value of the relevant Perpetual Sukuk Musharakah. Any excess of the income generated from the relevant Musharakah Venture above the relevant Expected Periodic Distribution Amount shall be retained by the Manager in the Reserve on behalf of the Sukukholders. Any payment of the Arrears of Deferred Periodic Distribution which are reinvested into the Musharakah Venture shall constitute payment of the Additional Capital (“Capital Payment”) to the Sukukholders. Any Capital Payment made by the Issuer shall be shared by the Sukukholders of all outstanding Perpetual Sukuk Musharakah on a pro-rata basis and the respective Sukukholders’ Musharakah Capital shall be adjusted accordingly. Printed on : 03/03/2020 19:17 Page 8 of 34
9. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions For the avoidance of doubt, any double counting with regards to the payment of the Arrears of Deferred Periodic Distribution vis-à-vis Capital Payment of the Musharakah Venture shall be disregarded. (b) Income from the Musharakah Venture less than Expected Periodic Distribution Amount If the income from the relevant Musharakah Venture is insufficient to pay the Expected Periodic Distribution Amount or such part thereof which has not been deferred pursuant to the Optional Deferral (as outlined in the section entitled “Other terms and conditions - Periodic Distribution Deferral”) and is therefore due and payable, the Manager (i) shall utilise any amount available in the Reserve to cover the Shortfall in respect of such Expected Periodic Distribution Amount which has not been deferred and is therefore due and payable and (ii) may at its sole discretion, provide a Liquidity Facility which shall be sufficient to make up the Shortfall (adjusted accordingly pursuant to any utilisation of the Reserve as referred to in (i) above, if applicable), in order to enable the Issuer to make payment of the said Expected Periodic Distribution Amount which has not been deferred. The Liquidity Facility shall be repaid to the Manager upon redemption of the Perpetual Sukuk Musharakah in full. In the event the income generated from the relevant Musharakah Venture is lower than the Expected Periodic Distribution Amount deferred or a loss situation occurs in the relevant Musharakah Venture and the amount in the Reserve has been fully utilised, the relevant Musharakah Venture shall be dissolved (“Deferral Dissolution”) through an exercise of the Purchase Undertaking (as defined herein), and such part of or all of the Exercise Price (as defined in the section entitled “Other terms and conditions - Exercise Price”) shall be applied towards investment in a new Musharakah Venture. The balance of the Exercise Price which is not applied towards investment in a new Musharakah Venture (if applicable) shall be distributed to the Sukukholders as Expected Periodic Distribution Amount which is not deferred. The accounting entries associated with the dissolution of the relevant Musharakah Venture and investment into a new Musharakah Venture shall be made in the books of the Manager. For the avoidance of doubt, (i) a dissolution of the relevant Musharakah Venture in this manner will not result in a redemption of the relevant Perpetual Sukuk Musharakah and (ii) any investment shall not increase the nominal value of the relevant Perpetual Sukuk Musharakah. Purchase Undertaking The Issuer, as the obligor to the Purchase Undertaking (“Purchase Undertaking Obligor”), shall issue a master purchase undertaking (“Purchase Undertaking”) to the Sukuk Trustee (acting for and on behalf of the Sukukholders), where the Issuer (as the Purchase Undertaking Obligor) undertakes to purchase the Sukukholders’ interests in the relevant Musharakah Venture from the Sukuk Trustee (acting for and on behalf of the Sukukholders) at the Exercise Price upon (i) the declaration of an Enforcement Event in accordance with the terms set out herein; or (ii) a Deferral Dissolution and to execute a sale agreement for such purchase. The purchase of the Sukukholders’ undivided beneficial interests in the relevant Musharakah Venture would result in the dissolution of the said Musharakah Venture. For the avoidance of doubt, in the case of Deferral Dissolution, the Exercise Price pursuant to the exercise of the Purchase Undertaking less the amount of such portion of the Expected Periodic Distribution Amount which is not deferred shall be invested into a new Musharakah Venture and the balance of the Exercise Price (if Printed on : 03/03/2020 19:17 Page 9 of 34
10. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions applicable) shall be distributed to the Sukukholders as Expected Periodic Distribution Amount which is not deferred. The Business of the new Musharakah Venture shall be different from the original Business that was part of the dissolved Musharakah Venture. Sale Undertaking The Sukuk Trustee (for and on behalf of the Sukukholders) shall issue a master sale undertaking (“Sale Undertaking”) to the Issuer, where the Sukuk Trustee (for and on behalf of the Sukukholders) undertakes to sell the Sukukholders’ interests in the relevant Musharakah Venture to the Issuer at the Exercise Price, upon redemption of the Perpetual Sukuk Musharakah pursuant to the relevant Redemption Events and execute a sale agreement for such sale, in accordance with the terms as set out herein. The Exercise Price shall be the sum payable by the Issuer to the Sukukholders pursuant to the relevant Redemption Events, Deferral Dissolution or Enforcement Events and such purchase shall be effected by the Issuer via a sale agreement pursuant to the Sale Undertaking or the Purchase Undertaking, as the case may be. The Exercise Price shall be calculated in accordance with the formula described in the section entitled “Other terms and conditions - Exercise Price”. For the avoidance of doubt, a separate sale agreement shall be executed from time to time upon the occurrence of a Redemption Event or a Deferral Dissolution or an Enforcement Event, where relevant, pursuant to the Purchase Undertaking or Sale Undertaking, as the case may be. (5) Currency : Ringgit (6) Expected facility/ programme size : Up to MYR 700,000,000.00 (7) Option to upsize (for : programme) Yes Additional Notes: The Issuer has the option to upsize the Perpetual Sukuk Musharakah Programme’s limit, from time to time, subject to the following being fulfilled prior to the exercise of the option: (a) the Sukukholders shall via the Trust Deed provide their upfront consent for any upsizing of the Perpetual Sukuk Musharakah Programme; (b) consent from existing lenders/financiers has been obtained, if required; (c) compliance with the relevant guidelines as may be issued by the Securities Commission Malaysia (“SC”) from time to time including the Guidelines on Unlisted Capital Market Products under the Lodge and Launch Framework issued by the Printed on : 03/03/2020 19:17 Page 10 of 34
11. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions SC on 9 March 2015 and revised on 26 November 2019 (as amended from time to time) (“LOLA Guidelines”); and (d) the necessary corporate authorisations of the Issuer have been obtained. For the avoidance of doubt, consent from the Sukuk Trustee, the Facility Agent or any other party under the Perpetual Sukuk Musharakah Programme is not required when the Issuer exercises its option to upsize the limit of the Perpetual Sukuk Musharakah Programme. (8) Tenure of facility/ programme : Perpetual (9) Availability period for : debt/ sukuk programme The Perpetual Sukuk Musharakah Programme shall be available for issuance in perpetuity and the Perpetual Sukuk Musharakah may be issued at any time upon completion of the Transaction Documents and fulfilment of all Conditions Precedent to the satisfaction of the Lead Arranger, unless waived by the Lead Arranger, provided that the first issuance of the Perpetual Sukuk Musharakah shall be made within sixty (60) business days from the date of lodgement of the required information and documents relating to the Perpetual Sukuk Musharakah with the SC (“Lodgement”). (10) Clearing and : settlement platform Payments Network Malaysia Sdn Bhd ("PayNet"). (11) Mode of issue : (12) Selling restrictions : Private/direct placement Bought deal Book building (i) At issuance: Part I of Schedule 6 of the Capital Markets & Services Act, 2007 (CMSA) Part I of Schedule 7 of the CMSA Read together with Schedule 9 of CMSA (ii) After issuance: Part I of Schedule 6 of the CMSA Read together with Schedule 9 of CMSA Additional Notes: Selling Restrictions at Issuance The Perpetual Sukuk Musharakah may only be offered, sold, transferred or otherwise disposed directly or indirectly, to a person to whom an offer for subscription or purchase of, or invitation to subscribe for or purchase the Perpetual Sukuk Musharakah and to whom the Perpetual Sukuk Musharakah are issued would fall within Part I of Schedule 6 and Part I of Schedule 7 of the CMSA read together with Schedule 9 or Section 257(3) of the CMSA, subject to any change in Printed on : 03/03/2020 19:17 Page 11 of 34
12. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions the applicable laws. Selling Restrictions Thereafter The Perpetual Sukuk Musharakah may only be offered, sold, transferred or otherwise disposed directly or indirectly, to a person to whom an offer for subscription or purchase of, or invitation to subscribe for or purchase the Perpetual Sukuk Musharakah and to whom the Perpetual Sukuk Musharakah are issued would fall within Part I of Schedule 6 of the CMSA read together with Schedule 9 or Section 257(3) of the CMSA, subject to any change in the applicable laws. (13) Tradability and transferability : Size in Ringgit which are tradable and transferable: MYR 700,000,000.00 Size in Ringgit which are non-tradable and non-transferable: Not applicable (14) Secured/combinatio : n of unsecured and secured, if applicable Each Tranche of Perpetual Sukuk Musharakah issued under the Perpetual Sukuk Musharakah Programme may or may not be secured. Perpetual Sukuk Musharakah which are secured (“Secured Perpetual Sukuk Musharakah”) will be secured by such security/collateral to be mutually agreed between the Issuer and the Lead Manager(s) prior to such issuance of Perpetual Sukuk Musharakah under the same Series. The security for each Series is referred to as “Series Security”. The details of the Secured Properties (as defined herein) and Series Security will be set out in the Pricing Supplement to be issued prior to the issuance of each Tranche of Perpetual Sukuk Musharakah and will be posted or uploaded onto the FAST or such other system in addition, alternate or substitution thereof in relation to the Perpetual Sukuk Musharakah prior to the issuance of each Tranche of Perpetual Sukuk Musharakah. Series Security The security for each Series of Secured Perpetual Sukuk Musharakah may include (but is not limited to) the following: (a) first legal charge and assignment over the relevant Escrow Account; (b) first fixed charge (in respect of properties with individual titles) over property(ies) to be mutually agreed between the Issuer and the Lead Manager prior to each issuance (“Properties With Title”); and/or (c) specific debenture creating a first fixed charge over property(ies) (in respect of which the individual titles have not been issued) to be mutually agreed between the Issuer and the Lead Manager prior to each issuance (“Properties Without Title”). The Properties With Title and the Properties Without Title shall collectively be referred to as “Secured Properties”. For the avoidance of doubt, the Secured Properties may comprise solely Properties With Title, solely Properties Without Title or a combination of both and shall include any Eligible Replacement Security (as defined below). Security for First Series In respect of the First Series, the security shall comprise a first legal assignment and charge over the Escrow Account (First Series) (as defined below) and shall include a first fixed charge or a specific debenture creating a first fixed charge over a combination of any of the following (which shall be determined prior to the first Printed on : 03/03/2020 19:17 Page 12 of 34
13. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions issuance under the First Series): (a) two (2) parcels of land measuring approximately 341.85 acres held under title no. PN 57073 Lot 22823 and PN 57074 Lot 22824, in Mukim Ulu Sungai Johor, District Kota Tinggi, Johor (Security Party: Iringan Kejora Sdn Bhd); (b) three (3) levels retail mall together with two (2) levels car parking bays and basement level of car park known as “M3 Mall” held under Parent Lot No. 200969, Master Title No. PN 51159, in Mukim Setapak, District Kuala Lumpur, Wilayah Persekutuan Kuala Lumpur measuring approximately 13,095 square metres (Security Party: Gerbang Mekar Sdn Bhd); (c) two (2) parcels of commercial land measuring approximately 34.79 acres held under title no. PN 117442 Lot 77380 (formerly known as HSD 41694 PT 44802) and PN 117443 Lot 77381 (formerly known as HSD 41695 Lot 44803), in Mukim Tanjong Duabelas, District Kuala Langat, Selangor (Security Party: Seribu Baiduri Sdn Bhd); (d) a parcel of development land referred to as Block 1 measuring approximately 53.13 acres held under title no. GRN 573732 Lot 11182 (formerly known as HSD 43061 PTD 18599), in Mukim Linau, District Batu Pahat, Johor (Security Party: Focal Remedy Sdn Bhd); (e) a parcel of development land referred to as Block 7 measuring approximately 109 acres held under title no. HSD 43067 PTD 18605, in Mukim Linau, District Batu Pahat, Johor (Security Party: Focal Remedy Sdn Bhd); (f) a parcel of development land referred to as Block 8 measuring approximately 59.21 acres held under title no. HSD 43068 PTD 18606, in Mukim Linau, District Batu Pahat, Johor (Security Party: Focal Remedy Sdn Bhd); (g) 89 nos. bungalow plots within Block 10 measuring approximately 14.46 acres held under titles no. (1) GRN 357702 Lot 8509 (formerly known as HSD 41617 PTD 6785); (2) GRN 357699 Lot 8508 (formerly known as HSD 41618 PTD 6786); (3) GRN 357690 Lot 8505 (formerly known as HSD 41621 PTD 6789); (4) GRN 357688 Lot 8504 (formerly known as HSD 41622 PTD 6790); (5) GRN 357677 Lot 8501 (formerly known as HSD 41625 PTD 6793); (6) GRN 357676 Lot 8500 (formerly known as HSD 41626 PTD 6794); (7) GRN 357675 Lot 8499 (formerly known as HSD 41627 PTD 6795); (8) GRN 357674 Lot 8498 (formerly known as HSD 41628 PTD 6796); (9) GRN 357554 Lot 8497 (formerly known as HSD 41629 PTD 6797); (10) GRN 357552 Lot 8496 (formerly known as HSD 41630 PTD 6798); (11) GRN 357549 Lot 8495 (formerly known as HSD 41631 PTD 6799); (12) GRN 357530 Lot 8490 (formerly known as HSD 41636 PTD 6804); (13) GRN 357528 Lot 8489 (formerly known as HSD 41637 PTD 6805); (14) GRN 357522 Lot 8488 (formerly known as HSD 41638 PTD 6806); (15) GRN 357489 Lot 8485 (formerly known as HSD 41641 PTD 6809); (16) GRN 357467 Lot 8484 (formerly known as HSD 41642 PTD 6810); (17) GRN 358922 Lot 8481 (formerly known as HSD 41645 PTD 6813); (18) GRN 358920 Lot 8480 (formerly known as HSD 41646 PTD 6814); (19) GRN 358914 Lot 8477 (formerly known as HSD 41649 PTD 6817); (20) GRN 358912 Lot 8476 (formerly known as HSD 41650 PTD 6818); (21) GRN 358886 Lot 8439 (formerly known as HSD 41651 PTD 6819); (22) GRN 358905 Lot 8472 (formerly known as HSD 41655 PTD 6823); (23) GRN 358906 Lot 8473 (formerly known as HSD 41656 PTD 6824); (24) GRN 358908 Lot 8474 (formerly known as HSD 41657 PTD 6825); (25) GRN 358910 Lot 8475 (formerly known as HSD 41658 PTD 6826); (26) GRN 357659 Lot 8556 (formerly known as HSD 41667 PTD 6835); (27) GRN 357660 Lot 8557 (formerly known as HSD 41668 PTD 6836); (28) GRN 357662 Lot 8558 (formerly known as HSD Printed on : 03/03/2020 19:17 Page 13 of 34
14. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions 41669 PTD 6837); (29) GRN 357663 Lot 8559 (formerly known as HSD 41670 PTD 6838); (30) GRN 357665 Lot 8560 (formerly known as HSD 41671 PTD 6839); (31) GRN 357744 Lot 8621 (formerly known as HSD 41674 PTD 6842); (32) GRN 357746 Lot 8622 (formerly known as HSD 41675 PTD 6843); (33) GRN 357752 Lot 8623 (formerly known as HSD 41676 PTD 6844); (34) GRN 357763 Lot 8626 (formerly known as HSD 41679 PTD 6847); (35) GRN 357773 Lot 8627 (formerly known as HSD 41680 PTD 6848); (36) GRN 357777 Lot 8628 (formerly known as HSD 41681 PTD 6849); (37) GRN 357781 Lot 8629 (formerly known as HSD 41682 PTD 6850); (38) GRN 357784 Lot 8630 (formerly known as HSD 41683 PTD 6851); (39) GRN 357727 Lot 8615 (formerly known as HSD 41687 PTD 6855); (40) GRN 357723 Lot 8614 (formerly known as HSD 41688 PTD 6856); (41) GRN 357720 Lot 8613 (formerly known as HSD 41689 PTD 6857); (42) GRN 357718 Lot 8612 (formerly known as HSD 41690 PTD 6858); (43) GRN 357712 Lot 8609 (formerly known as HSD 41693 PTD 6861); (44) GRN 357710 Lot 8608 (formerly known as HSD 41694 PTD 6862); (45) GRN 357586 Lot 8543 (formerly known as HSD 41700 PTD 6868); (46) GRN 357563 Lot 8538 (formerly known as HSD 41705 PTD 6873); (47) GRN 357560 Lot 8537 (formerly known as HSD 41706 PTD 6874); (48) GRN 358899 Lot 8469 (formerly known as HSD 41709 PTD 6877); (49) GRN 358888 Lot 8464 (formerly known as HSD 41714 PTD 6882); (50) GRN 358881 Lot 8437 (formerly known as HSD 41715 PTD 6883); (51) GRN 358316 Lot 8436 (formerly known as HSD 41716 PTD 6884); (52) GRN 358039 Lot 8458 (formerly known as HSD 41717 PTD 6885); (53) GRN 358041 Lot 8459 (formerly known as HSD 41718 PTD 6886); (54) GRN 358045 Lot 8462 (formerly known as HSD 41721 PTD 6889); (55) GRN 357915 Lot 8598 (formerly known as HSD 41726 PTD 6894); (56) GRN 357916 Lot 8599 (formerly known as HSD 41727 PTD 6895); (57) GRN 357917 Lot 8600 (formerly known as HSD 41728 PTD 6896); (58) GRN 357923 Lot 8606 (formerly known as HSD 41734 PTD 6902); (59) GRN 357909 Lot 8592 (formerly known as HSD 41737 PTD 6905); (60) GRN 357908 Lot 8591 (formerly known as HSD 41738 PTD 6906); (61) GRN 357904 Lot 8587 (formerly known as HSD 41742 PTD 6910); (62) GRN 357903 Lot 8586 (formerly known as HSD 41743 PTD 6911); (63) GRN 357902 Lot 8585 (formerly known as HSD 41744 PTD 6912); (64) GRN 358032 Lot 8454 (formerly known as HSD 41750 PTD 6919); (65) GRN 358031 Lot 8453 (formerly known as HSD 41751 PTD 6920); (66) GRN 358030 Lot 8452 (formerly known as HSD 41752 PTD 6921); (67) GRN 358000 Lot 8435 (formerly known as HSD 41753 PTD 6922); (68) GRN 358024 Lot 8448 (formerly known as HSD 41757 PTD 6926); (69) GRN 358025 Lot 8449 (formerly known as HSD 41758 PTD 6927); (70) GRN 358119 Lot 8572 (formerly known as HSD 41773 PTD 6942); (71) GRN 358120 Lot 8573 (formerly known as HSD 41774 PTD 6943); (72) GRN 358121 Lot 8574 (formerly known as HSD 41775 PTD 6944); (73) GRN 358124 Lot 8577 (formerly known as HSD 41778 PTD 6947); (74) GRN 358125 Lot 8578 (formerly known as HSD 41779 PTD 6948); (75) GRN 358126 Lot 8579 (formerly known as HSD 41780 PTD 6949); (76) GRN 358118 Lot 8571 (formerly known as HSD 41784 PTD 6953); (77) GRN 358117 Lot 8570 (formerly known as HSD 41785 PTD 6954); (78) GRN 358116 Lot 8569 (formerly known as HSD 41786 PTD 6955); (79) GRN 358115 Lot 8568 (formerly known as HSD 41787 PTD 6956); (80) GRN 358112 Lot 8565 (formerly known as HSD 41790 PTD 6959); (81) GRN 358111 Lot 8564 (formerly known as HSD 41791 PTD 6960); (82) GRN 358385 Lot 8521 (formerly known as HSD 41795 PTD 6964); (83) GRN 358383 Lot 8520 (formerly known as HSD 41796 PTD 6965); (84) GRN 358382 Lot 8519 (formerly known as HSD 41797 PTD 6966); (85) GRN 358372 Lot 8513 (formerly known as HSD 41803 PTD 6972); (86) GRN 358003 Lot 8442 (formerly known as HSD 41810 PTD 6979); (87) GRN 358002 Lot 8441 (formerly known as HSD 41811 PTD 6980); (88) GRN 358001 Lot 8440 (formerly known as HSD Printed on : 03/03/2020 19:17 Page 14 of 34
15. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions 41812 PTD 6981); (89) GRN 357998 Lot 8433 (formerly known as HSD 41813 PTD 6982), in Mukim Linau, District Batu Pahat, Johor (Security Party: Focal Remedy Sdn Bhd); and/or (h) a parcel of development land referred to as Block 16 measuring approximately 59.85 acres held under title no. HSD 43076 PTD 18614, in Mukim Linau, District Batu Pahat, Johor (Security Party: Focal Remedy Sdn Bhd). For the First Series, the Issuer shall ensure the following Security Cover (as defined below) is met at all times. “First Series” means the first Series of Perpetual Sukuk Musharakah under the Perpetual Sukuk Musharakah Programme, which shall be a Secured Perpetual Sukuk Musharakah. “Security Cover” means:in respect of the First Series, a minimum security cover of 1.43 times calculated in accordance with the following formula (the “Security Cover Formula”):MV + (EA x Cash Factor) NV where: MV = Market Value of the Secured Properties and Eligible Replacement Security as the case may be EA = Cash amounts in the Escrow Account (First Series) NV = Outstanding nominal value of the Perpetual Sukuk Musharakah of the First Series Cash Factor = 2 “Market Value” means the market value of the Secured Properties (including any Eligible Replacement Security) supported by the latest available valuation report(s) from any one or more property valuers within the agreed panel of property valuers set out in the relevant Transaction Documents (as defined below) and such valuation report(s) is to be addressed to the Security Trustee. In the case of determining the Security Cover prior to each issuance of Secured Perpetual Sukuk Musharakah, the valuation report(s) shall be dated no earlier than one (1) year prior to the proposed issue date of such Secured Perpetual Sukuk Musharakah issuance. In the case of determining the market value of the Eligible Replacement Security pursuant to the Release and Replacement of Security, the valuation report(s) of such Eligible Replacement Security shall be dated no more than six (6) months from the date of the Notification (as defined below). (A) Release and Replacement of Security The Issuer may request for the release of any of the Secured Properties to be replaced with Eligible Replacement Security and/or deposit cash amount into the Escrow Account provided always that the Security Cover is met at all times. Where the Issuer wishes to effect any Release and Replacement of Security, the Issuer shall provide the Security Trustee and the Sukuk Trustee with at least fifteen (15) business days’ prior notice (“Notification”) for the Security Trustee and the Sukuk Trustee to initiate such necessary actions in relation to such Release and Replacement of Security. The date of which the replacement of the Secured Properties with Eligible Replacement Security take effect shall be referred to as Printed on : 03/03/2020 19:17 Page 15 of 34
16. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions “Security Replacement Date”. (B) Revaluation of Secured Properties and Eligible Replacement Security All the Secured Properties, including Eligible Replacement Security shall be revalued every three (3) years from the issue date of the first Tranche of the Secured Perpetual Sukuk Musharakah under the relevant Series or three (3) years from the replacement date of the Secured Properties and Eligible Replacement Security, where applicable (each a “Revaluation Date”). The revaluation shall be based on a valuation report dated no more than six (6) months from the Revaluation Date. In relation to the First Series, on each Revaluation Date, (i) if the Security Cover is more than 1.43 times, the Issuer may request for a release or withdraw any of the Secured Properties, Eligible Replacement Security and/or cash in Escrow Account (First Series) in excess of the Security Cover of 1.43 times; and (ii) if the Security Cover is less than 1.43 times, the Issuer shall provide additional Eligible Replacement Security and/or cash deposit or procure the deposit of the relevant amount into the Escrow Account (First Series), in order for the Security Cover to be at least 1.43 time within two (2) months from such relevant Revaluation Date. In the event the Security Cover of 1.43 times is not met within two (2) months from the relevant Revaluation Date, the Periodic Distribution Rate (as defined below) shall be increased by an expected profit rate of three percent (3%) per annum above the prevailing Periodic Distribution Rate with effect from the expiry of two (2) months from the relevant Revaluation Date. Upon the Issuer providing Secured Properties, Eligible Replacement Security and/or deposit cash amount into the Escrow Account (First Series) causing the Security Cover to be at least 1.43 times, the Periodic Distribution Rate shall revert to the prevailing Periodic Distribution Rate with effect from the day immediately after the date on which the Security Cover is at least 1.43 times. "Eligible Replacement Security" in relation to the First Series, means first fixed charge or a specific debenture creating a first fixed charge over any one, or more of the following properties (items (a) to (e) of which the approval from the holders of the Perpetual Sukuk Musharakah (“Perpetual Sukuk Musharakah Holders”) are not required): (a) one (1) parcel of commercial land measuring approximately 5.13 acres held under title no. HSD 4791 PT 3273, in Mukim Tanah Rata, District Cameron Highlands, Pahang (Security Party: Casa Inspirasi Sdn Bhd); (b) one (1) parcel of residential land measuring approximately 4.30 acres held under title no. HSD 4795 PT 3277, in Mukim Tanah Rata, District Cameron Highlands, Pahang (Security Party: Casa Inspirasi Sdn Bhd); (c) one (1) parcel of residential land measuring approximately 52.88 acres held under title no. HSD 4797 PT 3279, in Mukim Tanah Rata, District Cameron Highlands, Pahang (Security Party: Casa Inspirasi Sdn Bhd); (d) one (1) parcel of commercial land measuring approximately 1.11 acres held under title no. PN 27955 Lot 15438, in Mukim Tanah Rata, District Cameron Highlands, Pahang (Security Party: Casa Inspirasi Sdn Bhd); (e) such other properties referred to in the section “Security for First Series” above Printed on : 03/03/2020 19:17 Page 16 of 34
17. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions which have not been utilised as security for the First Series; and/or (f) such other identified properties subject to the approval by Perpetual Sukuk Musharakah Holders by way of a special resolution. The terms and conditions of subsequent Series of Secured Perpetual Sukuk Musharakah in relation to Security Cover Formula, Release and Replacement of Security and Revaluation of Secured Properties and Eligible Replacement Security shall be similar to the above terms and conditions, unless otherwise agreed between the Issuer and the Lead Manager and as stated in the relevant Transaction Documents of the subsequent Series of Secured Perpetual Sukuk Musharakah. Additionally, in respect of subsequent Series of Secured Perpetual Sukuk Musharakah, such minimum security cover and the Cash Factor in the Security Cover Formula shall be determined and shall be mutually agreed between the Issuer and the Lead Manager prior to such issuance of the first Tranche under the relevant Series of the Secured Perpetual Sukuk Musharakah. Enforcement of Series Security The Security for all Series of Secured Perpetual Sukuk Musharakah shall be immediately enforceable upon an event of winding up of the Issuer, i.e. when the final and effective order is made or an effective resolution is passed for the winding-up or dissolution of the Issuer, provided that a stay on such order has not been granted by the relevant court of competent jurisdiction within thirty (30) days from the date of such order. (15) Details of guarantee, : if applicable Not guaranteed (16) Convertibility of : issuance and details of the convertability Non-convertible (17) Exchangeability of : issuance and details of the exchangeability Non-exchangeable (18) Call option and : details, if applicable Call option, details as follows: The Issuer may redeem the Perpetual Sukuk Musharakah pursuant to the following: (1) Optional Redemption (as defined in the section entitled “Other terms and conditions – Optional Redemption”); (2) Accounting Event Redemption (as defined in the section entitled “Other terms and conditions – Accounting Event Redemption”); (3) Tax Event Redemption (as defined in the section entitled “Other terms and conditions – Tax Event Redemption”); (4) Change in Control Event Redemption (as defined in the section entitled “Other terms and conditions – Change in Control Event Redemption”); Printed on : 03/03/2020 19:17 Page 17 of 34
18. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions (5) Leverage Event Redemption (as defined in the section entitled “Other terms and conditions – Leverage Event Redemption”); (6) Privatisation Event Redemption (as defined in the section entitled “Other terms and conditions – Privatisation Event Redemption”); or (7) Shareholder Event Redemption (as defined in the section entitled “Other terms and conditions – Shareholder Event Redemption”); (collectively, the “Redemption Events” and each a “Redemption Event”). (19) Put option and : details, if applicable No put option (20) Details of covenants : Positive Covenants For so long as any liability under the Perpetual Sukuk Musharakah Programme remains undischarged: (1) the Issuer shall maintain in full force and effect, and promptly renew from time to time, all relevant authorisations, consents, rights, licences, approvals and permits (governmental and otherwise) and will promptly obtain any further authorisations, consents, rights, licences, approvals and permits (governmental and otherwise) which are or may become necessary to enable it to own its assets, to carry on its business or for the Issuer to enter into or perform its obligations under the Transaction Documents or to ensure the validity, enforceability, admissibility in evidence of the obligations of the Issuer or the priority or rights of the Sukukholders under the Transaction Documents and the Issuer shall comply with the same; (2) the Issuer shall at all times on demand execute all such further documents and do all such further acts necessary at any time or times to give effect to the terms and conditions of the Transaction Documents; (3) the Issuer shall exercise reasonable diligence in carrying out its business and affairs in a proper and efficient manner and in accordance with sound financial and commercial standards and practices, which shall ensure, among others, that all necessary approvals or relevant licences are obtained and maintained; (4) the Issuer shall promptly comply with the terms and perform and carry out all its obligations under the Perpetual Sukuk Musharakah Programme and all the Transaction Documents to which it is a party (including but not limited to payment of amounts due under the Perpetual Sukuk Musharakah on the relevant dates on which such amounts are due and payable, subject to the Optional Deferral) and ensure that it shall immediately notify the Sukuk Trustee in the event that the Issuer is unable to fulfil or comply with any of the provisions of the Transaction Documents; (5) each of the Issuer and the parties from time to time providing security to the Security Trustee for the benefit of the Sukukholders (“Security Parties”) shall promptly perform and carry out its obligations under the Transaction Documents to which it is a party; (6) the Issuer shall open and maintain the required Designated Accounts, pay all relevant amounts into such Designated Accounts, make all payments from such Designated Accounts only as permitted under the Transaction Documents, and comply with the terms and conditions of the Transaction Documents in all matters Printed on : 03/03/2020 19:17 Page 18 of 34
19. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions concerning the Designated Accounts; (7) the Issuer shall prepare its financial statements on a basis consistently applied in accordance with approved accounting standards in Malaysia and those financial statements shall give a true and fair view of the results of the operations of the Issuer for the period to which the financial statements are made and shall disclose or provide against all liabilities (actual or contingent) of the Issuer; (8) the Issuer shall preserve and maintain good and valid title to its properties and assets; (9) the Issuer shall pay and discharge all taxes imposed upon it or its assets within the time period allowed save to the extent that (a) payment is being contested in good faith, and for which adequate reserves are being maintained for those taxes, or (b) payment can be lawfully withheld; (10) the Issuer shall promptly comply with all applicable laws and regulations including the provisions of the CMSA and/or the notes, circulars, conditions or guidelines issued by the SC from time to time with regards to the Perpetual Sukuk Musharakah Programme; (11) the Issuer shall to the extent required by law, punctually pay and discharge all indebtedness payable by it on or before their due dates; (12) the Issuer shall do all things necessary to preserve, renew and keep in full force and effect its legal existence; (13) the Issuer shall at all times maintain a paying agent who is based in Malaysia and the Issuer shall procure the paying agent to notify the Sukuk Trustee, through the Facility Agent, if the paying agent does not receive payment from the Issuer on the due dates as required under the Trust Deed and the terms and conditions of the Perpetual Sukuk Musharakah (unless any payment is deferred in accordance with the terms of the Perpetual Sukuk Musharakah); (14) the Issuer shall keep proper books and accounts at all times and to provide the Sukuk Trustee and any person appointed by it (e.g. auditors) access to such books and accounts to the extent permitted by law with a notice of seven (7) business days to be given in writing; (15) the Issuer shall ensure that the terms in the Transaction Documents do not contain any matter which is inconsistent with the provisions of the information memorandum issued in relation to the Perpetual Sukuk Musharakah Programme (if applicable); (16) the Issuer shall maintain adequate Takaful / insurance where necessary for the business of such nature with reputable Takaful providers / insurance companies and shall notify the Sukuk Trustee within seven (7) business days of any event which or may give rise to any claim or right of action under any Takaful / insurance; (17) the Issuer shall ensure that the Shariah-compliant Sukuk Trustee’s Reimbursement Account for Sukukholders’ actions (the “Sukuk Trustee’s Reimbursement Account”) as required under the Trust Deed Guidelines is opened and maintained, with a sum of Ringgit Malaysia Thirty Thousand (RM30,000.00) to be deposited therein. The Sukuk Trustee’s Reimbursement Account shall be solely operated by the Sukuk Trustee and the money in the Sukuk Trustee’s Reimbursement Account shall only be used strictly by the Sukuk Trustee in carrying out its duties in relation to the occurrence of an Enforcement Event (as defined in the section entitled “Events of default or enforcement events, where Printed on : 03/03/2020 19:17 Page 19 of 34
20. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions applicable, including recourse available to investors”) which are provided in the relevant Transaction Documents. This sum of money in the Sukuk Trustee’s Reimbursement Account shall be maintained at all times throughout the tenure of the Perpetual Sukuk Musharakah Programme or the Perpetual Sukuk Musharakah; and (18) such other positive covenants as may be required by the Lead Arranger and/or as may be advised by the Solicitor. Negative covenants For so long as any liability under the Perpetual Sukuk Musharakah Programme remains undischarged, without the prior written consent of the Sukuk Trustee (acting on instructions of the Sukukholders): (1) other than those existing prior to the execution of the Transaction Documents, the Issuer shall not create or permit to exist any encumbrance, mortgage, charge (whether fixed or floating), pledge, lien, hypothecation, assignment by way of security, trust arrangement for the purpose of providing security or other security interest of any kind including, without limitation, title transfer and/or retention arrangements having a similar effect or any agreement to create any of the foregoing on or over the whole or any part of its property, undertaking, assets or revenues (whether present or future), unless the following conditions are complied with: (i) there is no outstanding Arrears of Deferred Periodic Distribution; and (ii) no Enforcement Event has occurred. For the avoidance of doubt, no consent from the Sukuk Trustee is required for the Issuer to give any guarantee, indemnity, undertaking, financial assistance or credit support letter including but not limited to letters of comfort or any other similar agreement or arrangement, which are not secured against any of the Issuer’s property / assets / revenues, in relation to the borrowings / financings / operations of any of the entities within the Issuer, its subsidiaries, associated companies and/or jointly controlled entities (“LBS Bina Group”) and/or as required in the ordinary course of business of the LBS Bina Group; (2) the Issuer shall not add, delete, amend, supplement, vary or substitute its Constitution in a manner which would be inconsistent with the provisions of the Transaction Documents or that may materially and adversely affect the interest of the Sukukholders; (3) the Issuer shall not enter into any transactions, whether directly or indirectly with any of its interested persons (as defined in the Trust Deeds Guidelines) (“Interested Persons”) unless such transaction is entered into: (a) on an arm’s length basis and on terms that are no less favourable to the Issuer than those which could have been obtained in comparable transaction from persons who are not Interested Persons; and (b) with respect to transactions involving an aggregate payment or value equal to or greater than an agreed percentage ratio as set out in the Main Market Listing Requirements of Bursa Malaysia Securities Berhad (“Main Market Listing Requirements”), the Issuer obtains certification from an independent adviser that the transaction is carried out on fair and reasonable terms; provided that the Issuer certifies to the Sukuk Trustee that the transaction complies Printed on : 03/03/2020 19:17 Page 20 of 34
21. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions with paragraph (a) above, that the Issuer has received the certification referred to in paragraph (b) (where applicable) and that the transaction has been approved by the majority of the board of directors or shareholders in a general meeting as the case may require; and (c) with respect to transactions constituting a recurrent related-party transaction of a revenue of trading nature (“RRPT”) which are provided for and permitted under the Main Market Listing Requirements, provided that the Issuer certifies to the Sukuk Trustee that the transaction complies with paragraph (a) above, the Issuer has obtained or renewed (where applicable) the shareholders’ mandate in accordance with the Main Market Listing Requirements and that the Issuer furnishes at least one (1) certificate to the Sukuk Trustee in respect of the RRPT contemplated under one shareholders’ mandate; (4) the Issuer shall not utilise the proceeds from the Perpetual Sukuk Musharakah except for the purposes set out in the Transaction Documents and the information memorandum issued in relation to the Perpetual Sukuk Musharakah Programme (if applicable); (5) the Issuer shall not cancel, surrender, transfer, assign, relinquish or otherwise dispose of any of its rights and interest under the Transaction Documents (except as permitted under the Transaction Documents); (6) the Issuer shall not cancel, surrender, abandon or otherwise amend or permit to be cancelled, surrendered, abandoned or otherwise amended, any licences, grants, consents, approvals or authorisations in any way which could have a Material Adverse Effect, unless imposed by any applicable law or authorities; (7) the Issuer shall not change or cause or permit to change the nature and scope of its business from that carried on at the date of the Trust Deed; (8) the Issuer shall not decrease or in any way whatsoever alter (other than by way of increase) the paid-up share capital of the Issuer whether by varying the amount, structure or value thereof or the rights attached to thereto or convert any of its share capital into stock or by consolidation dividing or sub-dividing all or any of its shares, or any other manner; (9) the Issuer shall not enter into any consolidation or amalgamation with, or merger with or into, or transfer all or substantially all its assets to another entity, or enter into any demerger or reconstruction; (10) the Issuer shall not voluntarily enter into, commence or institute for its dissolution or for the appointment of a receiver, receiver and manager, liquidator, judicial manager or such other similar officer of the Issuer or take any other steps to wind-up or dissolve itself; (11) the Issuer shall not lend any money to any party other than: (a) loans to the Issuer’s directors, officers or employees as part of their terms of employment or as permitted under the Companies Act 2016; and/or (b) inter-company loans or advances to any entity within the LBS Bina Group; and (12) such other negative covenants as may be required by the Lead Arranger and/or as may be advised by the Solicitor. Financial Covenants Printed on : 03/03/2020 19:17 Page 21 of 34
22. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions No financial covenant Information Covenants For so long as any liability under the Perpetual Sukuk Musharakah Programme remains undischarged: (1) the Issuer shall provide to the Sukuk Trustee at least on an annual basis, a certificate confirming that the Issuer has complied with all its obligations under the Transaction Documents and the terms and conditions of the Perpetual Sukuk Musharakah Programme and that there did not exist or had not existed, from the date the Perpetual Sukuk Musharakah were issued or the date of the previous certificate as the case may be, any Enforcement Event, and if such is not the case, to specify the same; (2) the Issuer shall deliver to the Sukuk Trustee the following: (a) as soon as they become available (and in any event within one hundred and eighty (180) days after the end of each of its financial years), copies of its audited consolidated financial statements for that financial year which shall contain the statements of profit or loss and other comprehensive income and statements of financial position of the Issuer and which are audited in accordance with generally accepted accounting standards in Malaysia and certified without qualification by a firm of independent certified public accountants acceptable to the Sukuk Trustee; (b) as soon as they become available (and in any event within ninety (90) days after the end of the first half of each of its financial year), copies of its unaudited half yearly consolidated financial statements for that period which shall contain the statements of profit or loss and other comprehensive income and statements of financial position of the Issuer; (c) promptly, to the extent permitted by law, such additional financial or any other information relating to the Issuer’s affairs, business and/or its operations as the Sukuk Trustee may from time to time reasonably request in order to discharge its duties and obligations under the Transaction Documents; and (d) promptly, (i) all statutory notices or other documents received by the Issuer from any of its shareholders or its creditors which contents may have a Material Adverse Effect; and (ii) a copy of all documents (including accounts, reports, notices, statements or circular) dispatched by the Issuer to its shareholders or its creditors generally at the same time as these documents are dispatched to these shareholders or creditors, which may be circulated by the Sukuk Trustee at its discretion to the Sukukholders; (3) the Issuer shall notify the Sukuk Trustee in writing immediately in the event that the Issuer becomes aware of: (a) the occurrence of any Enforcement Event; (b) the happening of any event that has caused or could cause, one or more of the following: (i) any amount payable under the Perpetual Sukuk Musharakah to become immediately payable; (ii) the Perpetual Sukuk Musharakah to become immediately enforceable; or (iii) any other right or remedy under the terms, provisions or covenants of the Perpetual Sukuk Musharakah Programme or the Trust Deed to become Printed on : 03/03/2020 19:17 Page 22 of 34
23. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions immediately enforceable; (c) any circumstance that has occurred that would materially prejudice the Issuer, any of the Security Parties and/or any security created pursuant to the Perpetual Sukuk Musharakah Programme; (d) any substantial change in the nature of the business of the Issuer and/or any of the Security Parties; (e) any change in withholding tax position or taxing jurisdiction of the Issuer; (f) any change in the utilisation of proceeds arising from the issuance of the Perpetual Sukuk Musharakah under the Perpetual Sukuk Musharakah Programme where the information memorandum or the relevant Transaction Documents set out a specific purpose for which proceeds are to be utilised; and (g) any other matter that may materially prejudice the interests of the Sukukholders; (4) the Issuer shall promptly, to the extent permitted by law and in any case no later than thirty (30) days after such information is requested, provide to the Sukuk Trustee any information relating to LBS Bina Group’s affairs, business and/or operations as the Sukuk Trustee may from time to time reasonably request; (5) the Issuer shall immediately notify the Sukuk Trustee and the Facility Agent in the event Tan Sri Lim Hock San ceases to be the single largest shareholder (directly or indirectly) of the Issuer or otherwise ceases to control (directly or indirectly) the Issuer; and (6) such other information covenants as may be required by the Lead Arranger and/or as may be advised by the Solicitor. (21) Details of : designated account, if applicable Name of account: For each Series of the Secured Perpetual Sukuk Musharakah, the Issuer shall open and maintain a Shariah-compliant Escrow Account (“Designated Account”) with a bank acceptable to the Lead Arranger (in the case of the First Series) or acceptable to the Lead Manager(s) (in the case of subsequent Series), and the Security Trustee. For the Unsecured Perpetual Sukuk Musharakah, the Escrow Account would not be applicable. In respect of subsequent Series, the operations of the Escrow Account, if applicable for such subsequent Series, shall be mutually agreed between the Issuer and the Lead Manager(s) prior to such subsequent Series issuance and shall be similar to the operations of such Designated Account in respect of the First Series unless otherwise stated in the relevant Transaction Documents in respect of the subsequent Series. Parties responsible for opening the account: Issuer Parties responsible for maintaining/operating account: Security Trustee Signatories to account: Security Trustee Sources of funds: To be advised. Utilisation of funds: Printed on : 03/03/2020 19:17 Page 23 of 34
24. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions To be advised. Additional Notes: For the First Series, the Issuer shall open the following Designated Account: Name of account Escrow Account (First Series) Parties responsible for opening Issuer the account P a r t i e s r e s p o n s i b l e f o r Security Trustee maintaining / operating the account Signatories to the account Security Trustee Sources of funds In respect of the First Series, the Issuer shall deposit funds into the Escrow Account to meet the minimum Security Cover of 1.43 times. In respect of the First Series, the monies standing to the credit of the Escrow Account may only be: Utilisation of funds (a) utilised by the Issuer for Permitted Investments; (b) utilised by the Issuer to redeem the Perpetual Sukuk Musharakah pursuant to (i) an Optional Redemption; (ii) an Accounting Event Redemption; (iii) a Tax Event Redemption; (iv) a Change in Control Event Redemption; (v) a Leverage Event Redemption; (vi) a Privatisation Event Redemption; and/or (vii) a Shareholder Event Redemption; and (c) withdrawn by the Issuer to be used for any purpose pursuant to a Release and Replacement of Security, provided that additional security which are Eligible Replacement Security which would cause the Security Cover to be at least 1.43 times has been provided or procured by the Issuer. For the avoidance of doubt, where the Issuer exercises its right of redemption and utilises the amounts in the Escrow Account under (b) above in respect of all outstanding Perpetual Sukuk Musharakah (and not part thereof only), all monies in the Escrow Account can be applied towards payment of the relevant redemption sum. (22) Name of credit rating: Not rated Printed on : 03/03/2020 19:17 Page 24 of 34
25. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions agency, credit rating and amount rated, if applicable (23) Conditions precedent : To include but not limited to the following (all in form and substance acceptable to the Lead Arranger): A. Main Documentation (i) all relevant Transaction Documents, including the Security Documents (as defined in section entitled “Other terms and conditions – Transaction Documents”) in respect of the security identified by the Issuer to be utilised as security for the First Series (other than those which are required to be executed or perfected as a condition subsequent under item 25 of the section entitled “Other terms and conditions – Conditions Subsequent”), shall have been executed, stamped or endorsed as being exempted under Stamp Duty Exemption (No 23) Order 2000 or presented for registration, where applicable; (ii) the powers of attorney clauses contained in the relevant Transaction Documents have been registered with the High Court of Malaya; and (iii) all relevant notices of assignment, acknowledgement of the notices of assignment and consents (where applicable) under the relevant Security Documents shall have been made or received, as the case may be. B. The Issuer and the Security Parties (i) certified true copies of the Certificate of Incorporation and the Memorandum Articles of Association / Constitution of the Issuer and each of the Security Parties; (ii) certified true copies of the Issuer’s and each of the Security Parties’ latest forms as prescribed under sections 78 (Return of allotment), 46 (Registered office and office hours) and 58 (Duty to notify of particulars and changes of director, manager and secretary) of the Companies Act 2016; (iii) certified true copies of the board resolutions of the Issuer authorising, among others, the establishment of the Perpetual Sukuk Musharakah Programme, the issuance of the Perpetual Sukuk Musharakah and the execution of the Transaction Documents; (iv) certified true copies of the board resolutions of each of the Security Parties authorising, among others, the provision of security in respect of the Perpetual Sukuk Musharakah Programme and the execution of the relevant Transaction Documents; (v) a list of the Issuer’s and each of the Security Parties’ authorised signatories and their respective specimen signatures; (vi) a report of the relevant company search conducted with the Companies Commission of Malaysia on the Issuer and each of the Security Parties; and (vii) a report of the relevant winding-up search conducted with the office of the Director General of Insolvency on the Issuer and each of the Security Parties or the relevant statutory declaration of the Issuer and each of the Security Parties which indicate that the Issuer and each of the Security Parties have not been wound-up. C. General (i) acknowledgement from the SC on the lodgement made in respect of the Printed on : 03/03/2020 19:17 Page 25 of 34
26. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions Perpetual Sukuk Musharakah Programme under the LOLA Guidelines, and, where applicable, approval from other regulatory authorities in connection with the issuance of the Perpetual Sukuk Musharakah; (ii) evidence that the Statement of Particulars to be Lodged with Charge (as prescribed under the Companies Act 2016), where applicable, in respect of the charges created pursuant to the relevant Security Documents (for the purpose of registration of such charges with the CCM in accordance with the Companies Act 2016) have been duly lodged with the CCM; (iii) in the event any of the property which has been identified as security for the First Series is encumbered and is subject to redemption, documentary evidence that a private caveat has been lodged in favour of the Security Trustee in respect of such property; (iv) evidence that all the Designated Accounts have been opened in accordance with the Transaction Documents; (v) evidence that the Sukuk Trustee’s Reimbursement Account has been opened and a deposit of at least RM30,000.00 has been made; (vi) the Lead Arranger has received from the Solicitor, a satisfactory legal opinion addressed to them and the Sukuk Trustee advising with respect to, among others, the legality, validity and enforceability of the Transaction Documents and a confirmation addressed to the Lead Arranger that all the conditions precedent in respect of the Perpetual Sukuk Musharakah Programme have been fulfilled or otherwise waived (as the case may be); (vii) evidence that all transaction fees, costs and expenses in relation to the Perpetual Sukuk Musharakah Programme have been paid in full and/or arrangements (acceptable to the Lead Arranger) have been made for payment of the abovementioned fees, costs and expenses; (viii) where applicable and if required, satisfactory evidence that all confirmation that consents from the existing financiers, chargees, bank guarantors or assignees in respect of the Issuer’s existing indebtedness for the Issuer to undertake the Perpetual Sukuk Musharakah Programme and issue the Perpetual Sukuk Musharakah thereunder have been obtained; (ix) receipt of the endorsement from the Shariah Advisory Council (“SAC”) of the SC in respect of the Perpetual Sukuk Musharakah Programme; (x) receipt of the endorsement from the Shariah Adviser that the structure, mechanism and the Transaction Documents of the Perpetual Sukuk Musharakah Programme are in compliance with Shariah principles; (xi) receipt of a satisfactory valuation report, from any one or more of the agreed panel valuers, addressed to the Security Trustee, in respect of the properties which have been identified to be utilised as security for the First Series dated no earlier than one (1) year prior to the proposed issue date of the first Tranche of the Secured Perpetual Sukuk Musharakah under the First Series; (xii) in the event any of the property which has been identified as security for the First Series is encumbered and is subject to redemption, receipt of a redemption statement cum undertaking (in form and substance acceptable to the Lead Arranger) from the existing financiers of the financing facilities secured by such encumbered property to be refinanced using proceeds from the Perpetual Sukuk Musharakah, to discharge their existing security and execute and deliver all documents relating to such discharge upon receipt of the full redemption sum; Printed on : 03/03/2020 19:17 Page 26 of 34
27. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions (xiii) in the event any approval (including but not limited to consent from the relevant State Authority (as defined in the National Land Code 1965)) is required to create a charge over any property which is identified as security for the First Series, a certified true copy of the consent from the relevant authority to create a charge over such property; and (xiv) such other conditions precedent as may be required by the Lead Arranger and/or advised by the Solicitor. D. Conditions Precedent for subsequent Series of Secured Perpetual Sukuk Musharakah (other than the First Series) (i) all relevant Security Documents in respect of the security identified by the Issuer to be utilised as security for the relevant Series of Secured Perpetual Sukuk Musharakah (other than those which are required to be executed or perfected as a condition subsequent under item 25 of the section entitled “Other terms and conditions – Conditions Subsequent”) shall have been executed, stamped or endorsed as being exempted under Stamp Duty Exemption (No 23) Order 2000 or presented for registration, where applicable; (ii) the powers of attorney clauses contained in the relevant Security Documents have been registered with the High Court of Malaya; (iii) all relevant notices of assignment, acknowledgement of the notices of assignment and consents (where applicable) under the relevant Security Documents shall have been made or received, as the case may be; (iv) evidence that the Statement of Particulars to be Lodged with Charge (as prescribed under the Companies Act 2016), where applicable, in respect of the charges created pursuant to the relevant Security Documents (for the purpose of registration of such charges with the CCM in accordance with the Companies Act 2016) have been duly lodged with the CCM; (v) in the event any of the property which has been identified as security for the relevant Series of Secured Perpetual Sukuk Musharakah is encumbered and is subject to redemption, documentary evidence that a private caveat has been lodged in favour of the Security Trustee in respect of such property; (vi) evidence that all the Designated Accounts have been opened in accordance with the Transaction Documents in respect of the relevant Series of Secured Perpetual Sukuk Musharakah; (vii) the Security Trustee has received from the Solicitor, a satisfactory legal opinion addressed to them and the Sukuk Trustee advising with respect to, among others, the legality, validity and enforceability of the relevant Security Documents; (viii) receipt of a satisfactory valuation report, from any one or more of the agreed panel valuers, addressed to the Security Trustee, in respect of the properties which have been identified to be utilised as security for the relevant Series of Secured Perpetual Sukuk Musharakah dated no earlier than one (1) year prior to the proposed issue date of the first Tranche of the Secured Perpetual Sukuk Musharakah under the relevant Series; (ix) in the event any of the property which has been identified as security for the relevant Series of Secured Perpetual Sukuk Musharakah is encumbered and is subject to redemption, receipt of a redemption statement cum undertaking (in form and substance acceptable to the Lead Arranger) from the existing financiers of the Printed on : 03/03/2020 19:17 Page 27 of 34
28. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions financing facilities secured by such encumbered property to be refinanced using proceeds from the Perpetual Sukuk Musharakah, to discharge their existing security and execute and deliver all documents relating to such discharge upon receipt of the full redemption sum; (x) in the event any approval (including but not limited to consent from the relevant State Authority (as defined in the National Land Code 1965)) is required to create a charge over any property which is identified as security for the relevant Series of Secured Perpetual Sukuk Musharakah, a certified true copy of the consent from the relevant authority to create a charge over such property; and (xi) such other conditions precedent as may be required by the Lead Arranger and/or advised by the Solicitor. (24) Representations and : warranties To include but not limited to the following: (1) the Issuer is a company with limited liability duly incorporated and validly existing under the laws of Malaysia, has the full power and authority to carry on its business and to own its property and assets, and has full legal and beneficial ownership of all its respective property and assets; (2) the Constitution of the Issuer incorporates provisions which authorise, and all necessary corporate and other relevant actions have been taken to authorise, and all relevant consents and approvals of any administrative, governmental or other authority or body in Malaysia have been duly obtained and are in full force and effect which are required to authorise the Issuer to execute and deliver and perform the transactions contemplated in the Transaction Documents in accordance with their terms; (3) all authorisations, consents, licences, approvals and permits (governmental and otherwise), filings or registrations which are necessary to enable the Issuer to own its assets, to carry on its business have been obtained, fulfilled or taken, and are in full force and effect, and where the same is not obtained, fulfilled or taken or in full force and effect, it would not have a Material Adverse Effect; (4) neither the execution and delivery of any of the Transaction Documents nor the performance of any of the transactions contemplated by the Transaction Documents did or does as at the date this representation and warranty is made or repeated (a) contravene or constitute a default under any provision contained in any agreement, instrument, law, ordinance, decree, judgment, order, rule, regulation, licence, permit or consent by which the Issuer or any of its assets is bound or which is applicable to the Issuer, or any of its assets, (b) cause any limitation on the Issuer or the powers of its directors, whether imposed by or contained in its Constitution or in any agreement, instrument, law, ordinance, decree, order, rule, regulation, judgment or otherwise, to be exceeded, or (c) cause the creation or imposition of any security interest or restriction of any nature on any of the Issuer’s assets; (5) each of the Transaction Documents is or will when executed and/or issued, as the case may be, be in full force and effect and constitutes, or will when executed or issued, as the case may be, constitute, valid and legally binding obligations of the Issuer enforceable in accordance with its terms; (6) no other registration, recording, filing or notarisation of the Transaction Documents and no payment of any duty or tax and no other action whatsoever is necessary or desirable, apart from those required to be done as conditions Printed on : 03/03/2020 19:17 Page 28 of 34
29. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions precedent for the issuance of Perpetual Sukuk Musharakah as stated in the section entitled “Conditions Precedent” herein, to ensure the validity or enforceability in Malaysia of the liabilities and obligations of the Issuer or the rights of the Sukuk Trustee under the Transaction Documents in accordance with their terms or to ensure the admissibility in evidence in Malaysia of the Transaction Documents; (7) the audited consolidated financial statements (including the statements of profit or loss and other comprehensive income and statements of financial position) of the Issuer for each financial year are prepared in accordance with approved accounting standards in Malaysia and give a true and fair view of the results of its operations for that financial year and the state of its affairs at that date; (8) the Issuer is in compliance with and will comply with any applicable laws and regulations; (9) neither the Issuer nor its assets are entitled to immunity from process, execution, attachment or legal process; (10) none of the assets of the Issuer is affected by any security interest or other encumbrance, and the Issuer is not a party to, nor is it or any of its assets bound by any order, agreement or instrument under which the Issuer is, or in certain events may be required to create, assume or permit to arise any security interest or other encumbrance (other than as disclosed in writing to the Principal Adviser/Lead Arranger prior to the execution of the Transaction Documents under item (1) of the section entitled “Negative Covenants” above); (11) no step has been taken by or against the Issuer nor has any legal proceeding been commenced or to the best of the knowledge, information and belief of the Issuer after due and careful enquiry threatened for the dissolution, liquidation or winding-up of the Issuer or for the appointment of a receiver, receiver and manager, liquidator, judicial manager or similar officer in respect of all or any part of the business or assets of the Issuer and no demand under Section 466(1)(a) of the Companies Act 2016 has been received by the Issuer in respect of which the Issuer has not taken any action in good faith to set aside such claims within twenty one (21) days from the date of service of such claims for payment; (12) there is no litigation, arbitration or administrative proceeding or claim or lawsuit of or before any court, arbitral body or agency which is current, presently in progress or pending or to the best of the knowledge, information and belief of the Issuer after due and careful enquiry threatened against the Issuer or any of its assets which has or would have a Material Adverse Effect; (13) (a) any factual information provided by the Issuer to and/or for the benefit of the transaction parties (including the Facility Agent and the Lead Arranger) in connection with or as required under the Perpetual Sukuk Musharakah Programme do not contain any statement or information that is false or misleading, and there is no material omission in respect thereof and all expressions of expectation, intention, belief, opinion and projections contained therein were honestly made on reasonable grounds after its due and careful inquiry; and (b) the Issuer has disclosed to the transaction parties (including the Facility Agent and the Lead Arranger) all information with regard to the Issuer which the Issuer knows or should reasonably have known, which is material in the context of the Issuer in respect of the Perpetual Sukuk Musharakah Programme; (14) no steps have been taken by the Issuer or to the best of the knowledge, information and belief of the Issuer after due and careful enquiry its financiers/creditors or any of its shareholders or any other person on its behalf nor Printed on : 03/03/2020 19:17 Page 29 of 34
30. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions has any legal proceedings or applications been started or to the best of the knowledge, information and belief of the Issuer after due and careful enquiry threatened under section 366 of the Companies Act 2016; (15) to the best of the Issuer’s knowledge, information and belief of the Issuer after due and careful enquiry, no event or series of events has occurred which may have a Material Adverse Effect; and (16) such other representations and warranties as may be required by the Lead Arranger or advised by the Solicitor. Printed on : 03/03/2020 19:17 Page 30 of 34
31. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions (25) Events of defaults or : enforcement events, where applicable, including recourse available to investors Events of Default or Dissolution Events There are no events of default or dissolution events which will entitle the Sukuk Trustee or the Sukukholders to declare any or all amounts under the Perpetual Sukuk Musharakah to be immediately due and payable. Enforcement Events Upon the occurrence of any of the following enforcement events set out below, the Enforcement Method (as defined below) may be enforced. The enforcement events (collectively, the “Enforcement Events” and each an “Enforcement Event”) are as follows: (1) where a court order is made or an effective resolution is passed for the liquidation, winding-up or dissolution of the Issuer, provided that a stay on such order has not been granted by the relevant court of competent jurisdiction within thirty (30) days from the date of such order; and (2) the Issuer fails to pay (a) any amount in respect of the Exercise Price (as defined in the section entitled “Other terms and conditions – Exercise Price”) as a result of a Redemption Event or (b) any amount in respect of the Perpetual Sukuk Musharakah whether in respect of the Expected Periodic Distribution Amount due and payable or part thereof and any Arrears of Deferred Periodic Distribution, and such failure to pay under items (a) or (b) continues for a period of seven (7) business days or more (for this purpose, such payment of Expected Periodic Distribution Amount or part thereof and Arrears of Deferred Periodic Distribution will not be due if the Issuer has elected to defer such Expected Periodic Distribution Amount or part thereof in accordance with the Transaction Documents). For the avoidance of doubt, a breach of covenant by the Issuer (apart from failure to pay the amounts stated under item (2) above) will not constitute an Enforcement Event. Enforcement Method Upon the occurrence of an Enforcement Event under item (1) above, the Sukuk Trustee may at its discretion, and shall if so directed by an extraordinary resolution of the Sukukholders, declare that an Enforcement Event has occurred and require the Issuer to purchase the Sukukholders’ interest in the Musharakah Venture from the Sukuk Trustee (for and on behalf of the Sukukholders) at the relevant Exercise Price. Upon the occurrence of an Enforcement Event under item (2) above, the Sukuk Trustee may at its discretion, and shall if so directed by an extraordinary resolution of the Sukukholders, declare that an Enforcement Event has occurred and: (a) institute winding-up proceedings against the Issuer; and/or (b) prove in the winding-up of the Issuer and/or claim in the liquidation of the Issuer for such payment as it may think fit to enforce the obligations of the Issuer, under or arising from the Perpetual Sukuk Musharakah. Without prejudice to the above, the Sukuk Trustee may at its discretion or shall, if directed to do so by an extraordinary resolution of the Sukukholders, without further notice institute such proceedings against the Issuer, as it may think fit to enforce any term or condition binding on the Issuer under the Perpetual Sukuk Musharakah and the Trust Deed, and in no event shall the Issuer, by virtue of the institution of any such proceedings, be obliged to pay any sum or sums, in cash or otherwise, sooner than the same would otherwise have been payable by them. For the avoidance of doubt, it is not allowed under the terms and conditions of the Printed on : 03/03/2020 19:17 Page 31 of 34
32. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions Perpetual Sukuk Musharakah for acceleration of payments of all the outstanding Perpetual Sukuk Musharakah, save for an Enforcement Event under item (1) above. Printed on : 03/03/2020 19:17 Page 32 of 34
33. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions (26) Governing laws : Laws of Malaysia (27) Provisions on buyback, if applicable : The Issuer or any of its subsidiaries or agent(s) who is/are acting for the redemption or purchase, may at any time purchase the Perpetual Sukuk Musharakah at any price in the open market or by private treaty. Such Perpetual Sukuk Musharakah purchased by the Issuer or its subsidiaries or by agent(s) of the Issuer who is/are acting on behalf of the Issuer for such purchase, shall be cancelled by the Issuer and shall not be resold or reissued. (28) Provisions on early : redemption, if applicable The Perpetual Sukuk Musharakah are issued on a perpetual basis and may only be redeemed by the Issuer upon the occurrence of a Redemption Event. (29) Voting All matters or resolutions which require the Sukukholders’ consent/approval under the Perpetual Sukuk Musharakah Programme shall be carried out on a per Series basis. : The Perpetual Sukuk Musharakah redeemed by the Issuer shall be cancelled and cannot be reissued or resold. The Sukukholders belonging to a Series shall have voting rights only on all matters relating to that Series. For the avoidance of doubt, any matters or resolutions which require the consent or approval of the Sukukholders belonging to a Series will be carried out if the requisite majority of the Sukukholders of Perpetual Sukuk Musharakah then outstanding belonging to that Series (regardless of which Tranche they belong to in that Series) pass such ordinary resolution or special resolution, as the case may be, in support of such consent or approval. In the event consent or approval is required from Sukukholders of all Series in respect of matters in relation to the Perpetual Sukuk Musharakah Programme as a whole which would affect Sukukholders of all Series, the consent or approval will be carried out if the requisite majority of Sukukholders of the Perpetual Sukuk Musharakah then outstanding in each and every Series pass such ordinary resolution or special resolution, as the case may be, in support of such consent or determination. For the avoidance of doubt, if the Sukukholders of any one Series of Perpetual Sukuk Musharakah then outstanding do not pass the ordinary resolution or special resolution, as the case may be, then the consent or approval of the Sukukholders of all Series will not be obtained or granted. (30) Permitted investments, if applicable : The amount standing to the credit of the Sukuk Trustee’s Reimbursement Account may be invested in Permitted Investments (as defined below), to be determined after consultation with the Sukuk Trustee. “Permitted Investments” shall comprise investments in Shariah compliant products approved by the SC’s SAC or Bank Negara Malaysia’s (“BNM”) SAC and shall mean: (i) Sukuk guaranteed by the Government of Malaysia; (ii) Sukuk issued in Malaysia with the approval of the Government of Malaysia by any authority established under federal or state law; (iii) Islamic money market instruments where there is the flexibility of early Printed on : 03/03/2020 19:17 Page 33 of 34
34. LBS Bina Group Berhad (LBS Bina or the Issuer) Perpetual Sukuk Musharakah Programme Principal Terms and Conditions withdrawal without incurring any penalty such as bankers’ acceptance or promissory notes or certificates of deposit issued by any bank licensed pursuant to the Islamic Financial Services Act 2013 and having a minimum long term rating of A1 and short term rating of P1 by RAM Rating Services Berhad (“RAM”) or its equivalent by Malaysian Rating Corporation Berhad (“MARC”); (iv) Islamic money market unit trust funds with fund management companies licensed by the SC where there is the flexibility of early withdrawal without incurring any penalty; (v) Other deposits or accounts with any Islamic bank licensed pursuant to the Islamic Financial Services Act 2013 and having a minimum long term rating of A1 and short term rating of P1 by RAM or its equivalent by MARC; and (vi) Other Islamic capital market instruments of private entities having a long term rating of at least AAA and short term rating of P1 as determined by RAM or its equivalent by MARC. (31) Ta‘widh (for ringgit- : denominated sukuk) In the event of delay of payments of the Exercise Price due and payable to the Sukukholders pursuant to the exercise of the Purchase Undertaking or Sale Undertaking, as the case may be, LBS Bina as the Purchase Undertaking Obligor or the Issuer, as the case may be, shall pay the compensation on such amount at the rate and manner prescribed by the SAC of the SC from time to time. (32) Ibra’ (for ringgit: denominated sukuk) Not applicable. (33) Kafalah (for ringgit- : denominated sukuk) Not applicable. (34) Waivers from : complying with Guidelines on Unlisted Capital Market Products under the Lodge and Launch Framework and other relevant guidelines of the SC obtained for the facility/programme, if any Approval from the SC for waiver from compliance with certain paragraphs of the Trust Deeds Guidelines issued by the SC on 12 July 2011 (as amended from time to time) has been obtained on 25 October 2019. Printed on : 03/03/2020 19:17 Page 34 of 34