CIRCULAR TO SHAREHOLDERS IN RELATION TO...

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION.

If you are in any doubt as to the course of action you should take, you should consult your stockbroker, bank manager, solicitor, accountant or other professional adviser immediately. If you have sold or transferred all your shares in Boustead Holdings Berhad, you should at once hand this Circular together with the accompanying Form of Proxy to the purchaser, transferee or the agent through whom you affected the sale or transfer for onward transmission to the purchaser or transferee.

Bursa Malaysia Securities Berhad takes no responsibility for the contents of this Circular, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this Circular.

(Company No. 3871-H) (Incorporated in Malaysia)

CIRCULAR TO SHAREHOLDERS

IN RELATION TO THE

1. PROPOSED RENEWAL OF THE 2015 SHAREHOLDERS’ MANDATE FOR RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE

2. PROPOSED ADDITIONAL SHAREHOLDERS’ MANDATE FOR RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE

The resolutions pertaining to the above Proposals are set out in the Notice of the Company’s Fifty-Fourth Annual General Meeting which is attached in the enclosed Annual Report. The Fifty-Fourth Annual General Meeting is to be held at The Royale Ballroom, Level 2, The Royale Chulan Damansara, 2 Jalan PJU 7/3, Mutiara Damansara, 47810, Petaling Jaya, Selangor on 4 April 2016.

A Form of Proxy is set out in the Annual Report of Boustead Holdings Berhad for the financial year ended 31 December 2015. You are urged to complete and deposit the Form of Proxy at the office of the Company’s Share Registrar, Tricor Investor & Issuing House Services Sdn Bhd, located at Unit 32-01, Level 32, Tower A, Vertical Business Suite, Avenue 3, Bangsar South, No. 8, Jalan Kerinchi, 59200 Kuala Lumpur, not later than 48 hours before the time of the meeting. The return of the completed Form of Proxy will not preclude you fromattending and voting in person at the meeting should you subsequently wish to do so.

Last date and time for lodging the Form of Proxy : 2 April 2016 at 9.30 a.m.Date and time of the Fifty Fourth Annual General Meeting : 4 April 2016 at 9.30 a.m.

This Circular is dated 11 March 2016






IN RELATION TO THE












IN RELATION TO THE












IN RELATION TO THE







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DEFINITIONS

Except where the context otherwise requires, the following definitions shall apply throughout this Circular:-

(Words importing the singular shall, where applicable, include the plural and vice versa and words importing the masculine gender shall, where applicable, include the feminine and neuter genders and vice versa. Reference to persons shall include corporations.)

“Act” : Companies Act 1965 including all amendments made from time to time and any re-enactment thereof

“AGM” : Annual General Meeting

“BAH” : Boustead Atlas Hall Sdn Bhd (354726-D), a 51% owned subsidiary of Boustead Segaria Sdn Bhd (24681-V), which involves in oil and gas engineering agency services.

“Balau” : Boustead Balau Sdn Bhd (107809-H), a wholly owned subsidiary of Boustead Properties which involves in property development

“BBM” : Boustead Building Materials Sdn Bhd (349696-W), a wholly owned subsidiary of BHB which involves in marketing and distribution of building materials

“BCC” : Boustead Cruise Centre Sdn Bhd (32913-D), a wholly owned subsidiary of BHB which involves in provision of port facilities and services to cruise and navy vessels

“BCurve : Boustead Curve Sdn Bhd (103320-D), a wholly owned subsidiary of Boustead Properties Sdn Bhd which involves in property investment

“BESB” : Boustead Engineering Sdn Bhd (4226-M), a wholly owned subsidiary of BHB which involves in the distribution of engineering equipment and chemicals

“BHB”, “Boustead” or “Company”

: Boustead Holdings Berhad (3871-H)

“BHB Group” or “Group” : Boustead Holdings Berhad and its subsidiaries

“BHR” : Boustead Hotels & Resorts Sdn Bhd (147089-A), a wholly owned subsidiary of Boustead Properties which involves in hotel operation

“BIT” : Boustead Information Technology Sdn Bhd (202965-P), a wholly owned subsidiary of BHB which involves in computer services

“Board” : Board of Directors of BHB

“BPSB” : Boustead Petroleum Sdn Bhd (40996-P), a 59.82% owned subsidiary of BHB, which is an investment holding company

“Boustead Properties” : Boustead Properties Berhad (84-W), a wholly owned subsidiary of BHB which involves in investment holding, property development, property investment, ownership and operating of hotels and production and supply of chilled water for air conditioning

“Boustead Properties Group” : Boustead Properties and its subsidiaries

“BRSB” : Boustead Realty Sdn Bhd (270648-A), a wholly owned subsidiary of Boustead Properties which involves in property investment

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“BTS” : Boustead Travel Services Sdn Bhd (11708-P), a wholly owned subsidiary of BHB which involves in travel agencies and tour operations

“Bursa Malaysia” : Bursa Malaysia Securities Berhad

“BWQ” : Boustead Weld Quay Sdn Bhd (71504-A), a wholly owned subsidiary of Boustead Properties which involves in renting of property and hotel operation

“DEC” : Damansara Entertainment Centre Sdn Bhd (547844-U), a wholly owned subsidiary of Boustead Properties which involves in property investment

“Director” : Shall have the meaning given in section 4 of the Actand for the purpose of the Proposals includes any person who is or was within the preceding 6 months of the date on which the terms of the transactions were agreed upon, a Director of BHB or any other company which is its subsidiary or holding company; or Chief Executive Officer of BHB, its subsidiary or holding company

The term “Executive Director” shall mean a natural person who holds a directorship in a full time executive capacity on the Board and is on the payroll of the Company

“Listing Requirements” : Listing Requirements of Bursa Malaysia including all amendments made from time to time and any re-enactment thereof

“LPD” : 15 February 2016 being the Latest Practicable Date which shall not be more than 30 days prior to the date of the Circular

“LTAT” : Lembaga Tabung Angkatan Tentera, a statutory body established by the Tabung Angkatan Tentera Act 1973

“Major Shareholder” : A person who has an interest or interests in one or more voting shares in a corporation and the nominal amount of that share, or the aggregate of the nominal amounts of those shares, is:-

(a) 10% or more of the aggregate of the nominal amounts of all the voting shares in the company; or

(b) 5% or more of the aggregate of the nominal amounts of all the voting shares in the company where such person is the largest shareholder in the company

For the purpose of this definition, “interest in shares” shall have the meaning given in section 6A of the Act

It also includes any person who is or was within the preceding 6 months of the date on which the terms of the transaction were agreed upon, a major shareholder (as defined above) of a listed issuer or anyother company which is its subsidiary or holding company

“MRini” : Mutiara Rini Sdn Bhd (311297-H), a wholly owned subsidiary of Boustead Properties which involves in property development

“Person Connected ” : Shall be as defined in Chapter 1 of the Listing Requirements

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“Proposed Additional Shareholders’ Mandate”

: Proposed shareholders’ mandate for the BHB Group to enter into new Recurrent Related Party Transactions (i.e. Recurrent Related Party Transactions not covered in the 2015 Mandate)

“Proposed Renewal of Shareholders’ Mandate”

: Proposed renewal of the 2015 Mandate

“Proposals” : Proposed Renewal of Shareholders’ Mandate and Proposed Additional Shareholders’ Mandate

“Recurrent Related Party Transaction”

: A recurrent related party transaction of a revenue or trading nature which is necessary for the day to day operations and is entered into by the Company or its subsidiaries in the ordinary course of businesswhich involves the interest, direct or indirect, of a Related Party

“Related Party” : A Director, Major Shareholder or a Person Connected with such Director or Major Shareholder

“2015 Annual Report” : The annual report of the Company for the financial year ended 31 December 2015

“2015 Mandate” : The shareholders’ mandate obtained on 6 April 2015 for the BHB Group to enter into Recurrent Related Party Transactions

“2016 Mandate” : The shareholders’ mandate to be obtained at the Company’s forthcoming AGM for the BHB Group to enter into Recurrent Related Party Transactions

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CONTENTSPage

1. INTRODUCTION 5

2. PROPOSED RENEWAL OF SHAREHOLDERS’ MANDATE AND PROPOSED ADDITIONAL SHAREHOLDERS’ MANDATE

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2.1 Details 62.2 Classes of Related Party 62.3 Nature of Recurrent Related Party Transactions and Estimated Values 92.4 Amount Due and Owing Under Recurrent Related Party Transactions 182.5 Guidelines and Review Procedures for Recurrent Related Party Transactions 192.6 Statement by Audit Committee 222.7 Disclosure 22

3. RATIONALE AND BENEFIT 22

3.1 Rationale of the Proposed Renewal of Shareholders’ Mandate and Proposed 22 Additional Shareholders’ Mandate

3.2 Benefits to the BHB Group From Transacting With the Related Parties 23

4. CONDITION OF THE PROPOSALS 23

5. FINANCIAL EFFECTS OF THE PROPOSALS 23

6. DIRECTORS’ AND MAJOR SHAREHOLDERS’ INTERESTS 23

7. DIRECTORS’ RECOMMENDATION 24

8. AGM 24

9. FURTHER INFORMATION 24

APPENDICES

I. FURTHER INFORMATION 27

II. ADDRESS OF PROPERTIES RENTED 32

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BOUSTEAD HOLDINGS BERHAD (Company No. 3871-H)

(Incorporated in Malaysia)

Registered Office:

28th Floor, Menara Boustead 69 Jalan Raja Chulan

50200 Kuala Lumpur

11 March 2016

DIRECTORS: -

Gen. Tan Sri Dato’ Mohd Ghazali Hj. Che Mat (R) (Chairman)Tan Sri Dato’ Seri Lodin Wok Kamaruddin (Deputy Chairman / Group Managing Director)Dato’ Wira (Dr.) Megat Abdul Rahman Megat Ahmad Datuk Azzat Kamaludin Dato’ Ghazali Mohd AliDatuk Francis Tan Leh Kiah

To: The Shareholders of BOUSTEAD HOLDINGS BERHAD

Dear Sir/Madam BOUSTEAD HOLDINGS BERHAD

(I) PROPOSED RENEWAL OF THE 2015 SHAREHOLDERS’ MANDATE FOR RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE

(II) PROPOSED ADDITIONAL SHAREHOLDERS’ MANDATE FOR RECURRENT RELATED PARTY TRANSACTION OF A REVENUE OR TRADING NATURE

1. INTRODUCTION

At the AGM held on 6 April 2015, the Company had obtained the 2015 Mandate to enter into Recurrent Related Party Transactions. The 2015 Mandate shall, in accordance with the Listing Requirements, lapse at the conclusion of the forthcoming AGM unless authority for its renewal is obtained from the shareholders of the Company at the AGM.

Accordingly, the Company had on 25 February 2016 announced to Bursa Malaysia of its intention to seek shareholders’ approval on the Proposals at the forthcoming AGM.

The purpose of this Circular is to provide you with information relating to the Proposals and to seek your approvals on the Ordinary Resolutions pertaining to the Proposals to be tabled at the forthcoming AGM. Notice of the AGM together with the Form of Proxy is enclosed in the Annual Report of the Company.

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BOUSTEAD HOLDINGS BERHAD (Company No. 3871-H)

(Incorporated in Malaysia)

Registered Office:

28th Floor, Menara Boustead 69 Jalan Raja Chulan

50200 Kuala Lumpur

11 March 2016

DIRECTORS: -

Gen. Tan Sri Dato’ Mohd Ghazali Hj. Che Mat (R) (Chairman)Tan Sri Dato’ Seri Lodin Wok Kamaruddin (Deputy Chairman / Group Managing Director)Dato’ Wira (Dr.) Megat Abdul Rahman Megat Ahmad Datuk Azzat Kamaludin Dato’ Ghazali Mohd AliDatuk Francis Tan Leh Kiah

To: The Shareholders of BOUSTEAD HOLDINGS BERHAD

Dear Sir/Madam BOUSTEAD HOLDINGS BERHAD

(I) PROPOSED RENEWAL OF THE 2015 SHAREHOLDERS’ MANDATE FOR RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE

(II) PROPOSED ADDITIONAL SHAREHOLDERS’ MANDATE FOR RECURRENT RELATED PARTY TRANSACTION OF A REVENUE OR TRADING NATURE

1. INTRODUCTION

At the AGM held on 6 April 2015, the Company had obtained the 2015 Mandate to enter into Recurrent Related Party Transactions. The 2015 Mandate shall, in accordance with the Listing Requirements, lapse at the conclusion of the forthcoming AGM unless authority for its renewal is obtained from the shareholders of the Company at the AGM.

Accordingly, the Company had on 25 February 2016 announced to Bursa Malaysia of its intention to seek shareholders’ approval on the Proposals at the forthcoming AGM.

The purpose of this Circular is to provide you with information relating to the Proposals and to seek your approvals on the Ordinary Resolutions pertaining to the Proposals to be tabled at the forthcoming AGM. Notice of the AGM together with the Form of Proxy is enclosed in the Annual Report of the Company.

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2. PROPOSED RENEWAL OF SHAREHOLDERS’ MANDATE AND PROPOSED ADDITIONAL SHAREHOLDERS’ MANDATE

2.1 Details

Provisions under the Listing Requirements

Pursuant to Part E, Chapter 10.09 of the Listing Requirements, listed issuers with an issued and paid-up capital of RM60 million and above must immediately announce a Recurrent Related Party Transaction as follows:

(i) the consideration, value of the assets, capital outlay or costs of the Recurrent Related Party Transaction is RM1 million or more; or

(ii) the percentage ratio of such Recurrent Related Party Transaction is 1% or more

whichever is higher.

Paragraph 2.4 of Practice Note 12 states that where a listed issuer has obtained a shareholders’ mandate in respect of any Recurrent Related Party Transaction, the above disclosure obligation will not apply to the Recurrent Related Party Transactions which are comprised in the mandate.

Accordingly, the Company proposes to seek its shareholders’ approval for the Proposals to enable the BHB Group to enter into transactions with the Related Parties which are of a revenue or trading nature and necessary for its day-to- day operations, on terms not more favourable to the Related Parties than those generally available to the public and are not detrimental to the minority shareholders.

If approved at the forthcoming AGM, the Proposals will take effect from the passing of the Ordinary Resolutions relating thereto and will continue to be in force until:-

i) The conclusion of the next AGM of the Company following the general meeting at which the authorisation is obtained, at which time it shall lapse, unless by Ordinary Resolutions passed at the meeting, the authority is renewed either unconditionally or subject to conditions; or

ii) The expiration of the period within which the next AGM of the Company after this date is required to be held pursuant to section 143(1) of the Act (but shall not extend to such extension as may be allowed pursuant to section 143(2) of the Act); or

iii) Revoked or varied by resolution passed by the shareholders in a general meeting

whichever is the earlier.

Thereafter, shareholders’ approval will be sought for the renewal of the shareholders' mandate at each subsequent AGM, subject to a satisfactory review by the Company’s Audit and Risk Committee.

2.2 Classes of Related Party

BHB is a conglomerate with diverse business operations. The principal activity of BHB is investment holding. The principal activities of its subsidiaries include the ownership and/or management of oil palm plantations, marketing, selling and distributing imported and locally manufactured products, shipping agencies, travel offices, property development, property

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investment, hotels, leasing, ship building, vessel repair and maintenance, fabrication of offshore structures, and provision of defence-related services, education, fabrication and marketing of materials handling systems, provision of air transportation, flight support, engineering and technical services, manufacturing of fiber cement products, manufacturing of paints, manufacturing of pharmaceutical products and marketing of petroleum products. The principal activities of its associated companies are operating a commercial bank, Islamic bank and an investment bank, and engaging in general and life insurance, manufacturing of confectionary and marketing of toiletries.

The holding corporation of BHB is LTAT. LTAT owns 58.43% of the issued and paid-up share capital of BHB as at LPD.

BHB’s subsidiaries, Pharmaniaga Berhad, Boustead Heavy Industries Corporation Berhad, Boustead Plantations Berhad and an associated company, Affin Holdings Berhad are listed on the Bursa Malaysia’s Main Market. The Boustead Group, comprising more than 100 subsidiary and associate companies, has substantial interests in various sectors of the Malaysian economy.

The Proposals will apply to the following companies (the effective interest is at LPD):-

I. SUBSIDIARIES NOT WHOLLY OWNED BY BHB

Company Principal Activities BHB's Effective Interest (%)

1. Boustead Heavy Industries Corporation Berhad (“BHIC”) Investment holdings 65.0

2. Boustead Naval Shipyard Sdn Bhd (“BNS”)

Construction, repair & maintenance of naval ships, weapons and electronics, design and engineering, fabrication of steel structures and commercial shipbuilding

68.9

3. Boustead Petroleum MarketingSdn Bhd (“BPM”) Marketing of petroleum products 42.0

4. Pharmaniaga Berhad (“Pharma”) Investment holdings 56.4

5. Boustead Plantations Berhad (“Boustead Plantations”) Investment holdings 57.4

II. BHB'S ASSOCIATES

1. Affin Holdings Berhad Group (“AHB”) Financial services group 20.7

2. Jendela Hikmat Sdn Bhd (“JHSB”) Property development 30.0

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III. BHB'S JOINT VENTURE

1. Irat Hotel and Resorts Sdn Bhd (“Irat”) Property investment 50.0

IV. LTAT’S SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE

1. Affin Holdings Berhad Group (“AHB”) Financial services group 35.42

2. Boustead Plantations Berhad (“Boustead Plantations”)

Investment holding and oil palm cultivation 11.97

3. Boustead Naval Shipyard Sdn Bhd (“BNS”)

Construction, repair & maintenance of naval ships, weapons and electronics, design and engineering, fabrication of steel structures and commercial shipbuilding

10.4

4. Boustead Heavy Industries Corporation Berhad (“BHIC”) Investment holdings 8.2

5. Perwira Niaga Malaysia (“PNM”) Trading of consumer goods 100.0

6. Jendela Hikmat Sdn Bhd (“JHSB”) Property development 30.0

7. Perbadanan Perwira Harta Malaysia(“PPHM”) Property development 100.0

8. Irat Hotel and Resorts Sdn Bhd (“Irat”) Property investment 30.0

9. Boustead Petroleum MarketingSdn Bhd (“BPM”) Marketing of petroleum products 30.0

10. Pharmaniaga Berhad (“Pharma”) Investment holdings 5.03

V. FIRMS / CORPORATIONS CONNECTED WITH A DIRECTOR AND/OR OFFICER

1. Arkitek MAA Sdn Bhd (“Arkitek MAA”)

Architect firmDato’ Ghazali Mohd Ali is a Director of BHB and Boustead Properties and also member of the architect firm. He owns 10% of share in Arkitek MAA.

2. Azzat & Izzat Legal firm Datuk Azzat Kamaludin is a Director of BHB and partner of the legal firm.

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2.3 Nature of Recurrent Related Party Transactions and Estimated Values

It is anticipated that the Group would, in the normal course of business, enter into transactions involving Related Parties set out in section 2.2 above. The shareholdings of BHB, LTAT and other interested parties in the Related Party are also set out in Section 2.2 above. It is likely that such transactions will occur with some degree of frequency and could arise at any time.

2.3.1 Existing Recurrent Related Party Transactions

Existing Recurrent Related Party Transactions for which approval is now being sought for the Proposed Renewal of Shareholders’ Mandate at the forthcoming AGM are as follows:-

Company Nature of Transactions Related Party

2016 Mandate 2015 Mandate

(A)

Estimated value of

transaction pursuant to

2016 Mandate#

(RM’000)

(B)

Estimated value of

transaction disclosed in

2015 Mandate#

(RM’000)

(C)

Actual valueof transaction

conducted pursuant to

2015 Mandate[as at LPD] #

(RM'000)

Deviation between values in

(B) and (C)

(%)

I. SUBSIDIARIES NOT WHOLLY OWNED BY BHB (LTAT has direct and indirect interests)

1 BNS a) Ship building and repair works provided to BHIC

b) Office rental^ at Menara Boustead paid to BRSB

c) Premise rental paid by BHIC

d) Provision of computer service from BIT

e) Provision of construction works to BHIC

DirectorLWK(Note 2)

GMA(Note 3)

AK(Note 4)

Major ShareholderLTATA

33,000

2,300

8,260

8,000

2,400

40,000

2,200

7,410

5,300

2,400

5,411

2,198

3,411

491

390

-86%

0%

-54%

-91%

-84%

TOTAL 53,960 57,310 11,901 -79 %

^The lease period is 3 years which involves payments of rental on monthly basis.

Premise rented comprises of the followings: i. Office, workshop, lamination facility and hangar space located at Bukit Malut, Mukim Kedawang, 07000, Langkawi, Kedah. The

lease period is 2 years which involves payments of rental on monthly basis. ii. Office space at Wisma Boustead and Menara Boustead. The lease period is between 25.5 months to 3 years which involves

payments of rental on monthly basis. iii. Office and workshop/working areas at Pangkalan TLDM, 32100 Lumut, Perak. The lease period is between 1 to 5 years which

involves payments of rental on monthly basis. A LTAT holds 10.4% of BNS directly. LTAT is indirectly interested in BNS via BHB’s 68.9% direct interest in BNS and BHB’s 13.4%

indirect interest in BNS through BHIC, which holds 20.7% of BNS. # The amounts are exclusive of GST.

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2.3.1 Existing Recurrent Related Party Transactions (cont’d)



(A)

Estimated value of


2016 Mandate#

(RM’000)

(B)

Estimated value of


2015 Mandate#

(RM’000)

(C)




(RM'000)


(B) and (C)

(%)

2 BHIC a) Sale of equipment and machinery for ship related activities to BNS

b) Ship building and ship repairs works provided to BNS

c) Premise rental paid by BNS

d) Provision of training to BNS

e) Supply of electronic equipment and provision of related services to BIT

f) Provision of IT related service from BIT

g) Office rental * at Menara Boustead, Penang paid to BHB

h) Sale of equipments and machinery for ship related activities to BCC

DirectorLWK(Note 2)

GMA(Note 3)

AK(Note 4)

Major ShareholderLTATB

4,000

912,000

1,500

2,000

-

-

320

-

4,000

782,000

1,300

2,000

30,000

15,000

350

16,900

990

510,303

1,281

56

-

-

246

830

-75%

-35%

-1%

-97%

-100%

-100%

-30%

-95%

TOTAL 919,820 851,550 513,706 -40%

Premise rented at Block 3502, Enterprise Building 2, Jalan Teknokrat 4, Cyber 5 63000 Cyberjaya Selangor. The lease period is 3 years which involves payments of rental on monthly basis.

* The lease period is 3 years which involves payments of rental on monthly basis.B LTAT holds 8.2% of BHIC directly. LTAT is indirectly interested in BHIC via BHB’s 65.0% shareholding in BHIC.# The amounts are exclusive of GST.

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Company Nature of Transactions

Related Party


(A)

Estimated value of


2016 Mandate#

(RM’000)

(B)

Estimated value of


2015 Mandate#

(RM’000)

(C)




(RM'000)


(B) and (C)

(%)

3 BPM Sale of non-regulated petroleum products to BHB Group

DirectorLWK(Note 2)

GMA(Note 3)

Major ShareholderLTATC

7,000 7,000 5,167 -26%

4 Boustead Plantations

a) Provision of IT related service from BIT

b) Office rental* at Menara Boustead paid to Boustead Properties

c) General management fees, internal audit fees and tax consultancy fees paidto BHB

DirectorMGHC(Note 1)

LWK(Note 2)

GMA(Note 3)

Major ShareholderLTATD

5,000

2,500

2,700

5,000

1,200

2,700

1,396

1,269

1,696

-72%

6%

-37%

TOTAL 17,200 15,900 9,528 -40%

C LTAT holds 30.0% of BPM directly. LTAT is indirectly interested in BPM via BHB’s 42.0% indirect interest in BPM through BPSB, which holds 70.0% of BPM. * The lease period is 3 years which involves payments of rental on monthly basis.D LTAT holds 11.97%of Boustead Plantations directly. LTAT is indirectly interested in Boustead Plantations via BHB’s 57.4% shareholding in Boustead Plantations. # The amounts are exclusive of 6% GST.

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(A)

Estimated value of


2016 Mandate#

(RM’000)

(B)

Estimated value of


2015 Mandate#

(RM’000)

(C)




(RM'000)


(B) and (C)

(%)

I. SUBSIDIARIES NOT WHOLLY OWNED BY BHB (LTAT has direct and indirect interests) (cont’d)

5 Pharma a) Supply of computer equipment from BIT

b) Provision of corporate and administrative support services and training from BHB

c) Premise rental~ paid to BCurve

DirectorLWK(Note 2)

GMA(Note 3)

Major ShareholderLTATE

-

1,500

-

50,000

1,300

1,500

480

1,093

569

-99%

-16%

-62%

II. BHB’s ASSOCIATE & JOINT VENTURE (LTAT has direct and indirect interests)

1 AHB a) Office* rental at Menara Boustead, Menara Affin and the Curve paid to BRSB, BCurve and Boustead Properties

b) Provision of professional service to BHB, BNS and Boustead Properties

DirectorLWK(Note 2)

GMA(Note 3)

Major ShareholderLTATF

18,143

8,100

17,000

8,100

16,395

1,594

-4%

-80%

TOTAL 27,743 77,900 20,131 -74%

~ Premise rented comprises of warehouse facilities located at Lot 49, No. 11 Jalan Ragum 15/17, Section 15, 40000 Shah Alam, Selangor. The lease period is 3 years which involves payments of rental on monthly basisE LTAT holds 5.03% of Pharma directly. LTAT is indirectly interested in Pharma via BHB’s 56.4% shareholding in Pharma* The lease periods are 3 years for Menara Boustead and the Curve, and 5 years for Menara Affin, all of which involve payment of rental on

a monthly basis. F LTAT owns 35.42% of AHB directly. LTAT is indirectly interested in AHB via BHB’s 20.7% shareholding in AHB.# The amounts are exclusive of 6% GST.

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(A)

Estimated value of


2016 Mandate#

(RM’000)

(B)

Estimated value of


2015 Mandate#

(RM’000)

(C)




(RM'000)


(B) and (C)

(%)

II. BHB’s ASSOCIATE & JOINT VENTURE (LTAT has direct and indirect interests) (cont’d)

2 Irat Rental^ of hotel building paid by BHR

DirectorLWK(Note 2)

GMA(Note 3)

Major ShareholderLTATG

13,000 13,200 12,346 -6%

TOTAL 13,000 13,200 12,346 -6%

G LTAT owns 30.0% of Irat directly. LTAT is indirectly interested in Irat via LTAT’s 50% shareholding and BHB’s 50% shareholding in

Irat Properties Sdn Bhd, which holds 70.0% of Irat. ^ The lease period is 3 years which involves payments of rental on monthly basis. # The amounts are exclusive of 6% GST.

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(A)

Estimated value of


2016 Mandate#

(RM’000)

(B)

Estimated value of


2015MandateH#

(RM’000)

(C)




(RM'000)


(B) and (C)

(%)

III. LTAT’S SUBSIDIARY

1 JHSB Provision of project management service from Boustead Properties

DirectorLWK(Note 2)

GMA(Note 3)

Major ShareholderLTATI

- 2,000 - -100%

IV. FIRMS / CORPORATIONS CONNECTED WITH A DIRECTOR AND/OR OFFICER

1 Arkitek MAA

Provision of architectural services to BWQ, BCurve, MRini, DEC and Balau

DirectorGMA(Note 3)

17,900 13,900 7,947 -43%

2 Azzat & Izzat

Provision of legal services to BHB, Boustead Properties Group, Boustead Plantations, Sissons, BBM, BHIC and BNS

DirectorAK(Note 4)

6,800 4,200 1,102 -74%

TOTAL 24,700 20,100 9,049 -55 %

I LTAT owns 30.0% of JHSB directly. LTAT is indirectly interested in JHSB via BHB’s 30.0% shareholding in JHSB.# The amounts are exclusive of 6% GST.

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(A)

Estimated value of


2016 Mandate#

(RM’000)

(B)

Estimated value of


2015 Mandate#

(RM’000)

(C)




(RM'000)


(B) and (C)

(%)

IV. LTAT

1 LTAT Provision of project management service from Boustead Properties

DirectorLWK(Note 2)

GMA(Note 3)

Major ShareholderLTATJ

5,400 6,100 1,200 -80%

TOTAL 5,400 6,100 1,200 -80%

GRAND TOTAL 1,061,823 1,042,060 577,861 -45%

J LTAT is indirectly interested in Boustead Properties via LTAT’s 58.43% direct interest in BHB which holds 100.0% interest in Boustead

Properties.# The amounts are exclusive of GST.

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2.3.2 Additional Recurrent Related Party Transactions

Additional Recurrent Related Party Transactions for which approval is now being sought for the Proposed Additional Shareholders’ Mandate at the forthcoming AGM are as follows:-


2016 Mandate

Estimated value of transaction

pursuant to 2016Mandate

#

(RM’000)

I. SUBSIDIARIES NOT WHOLLY OWNED BY BHB (LTAT has direct and indirect interests)

1 BNS (a) Provision of project management service from BESB

(b) Purchase of air tickets and travel related services from BTS

DirectorLWK(Note 2)

GMA(Note 3)

AK(Note 4)

Major ShareholderLTATK

5,700

1,050

2 BHIC (a) Provision of project management service from BAH

(b) Purchase of air tickets and travel related services from BTS

(c) Provision of training, management and related services from BHB

(d) Provision of terminal and related services to BCC

(e) Rental of premises by BAH+

DirectorLWK(Note 2)

GMA(Note 3)

AK(Note 4)

Major ShareholderLTATL

8,400

3,500

400

2,500

100

3 Pharma (a) Purchase of air tickets and travel related services from BTS

(b) Purchase of equipment from BESB

DirectorLWK(Note 2)

GMA(Note 3

Major ShareholderLTATM

1,500

2,500

4 Boustead Plantations

Purchase of air tickets and travel related services from BTS


LWK(Note 2)

GMA(Note 3)

Major ShareholderLTATN

1,000

TOTAL 26,650

K LTAT holds 10.4% of BNS directly. LTAT is indirectly interested in BNS via BHB’s 68.9% direct interest in BNS and BHB’s 13.4%

indirect interest in BNS through BHIC, which holds 20.7% of BNS. + Premise rented at Suite 19.04-05, Level 19 Wisma Goldhill, No. 67, Jalan Raja Chulan 50200 Kuala Lumpur which involve payments of

rental on monthly basis. L LTAT holds 8.2% of BHIC directly. LTAT is indirectly interested in BHIC via BHB’s 65.0% shareholding in BHICM LTAT holds 5.03% of Pharma directly. LTAT is indirectly interested in Pharma via BHB’s 56.4% shareholding in PharmaN LTAT holds 11.97% of Boustead Plantations directly. LTAT is indirectly interested in Boustead Plantations via BHB’s 57.4% shareholding in Boustead Plantations.

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2016 Mandate

Estimated value of transaction

pursuant to 2016 Mandate

#

(RM’000)

I. SUBSIDIARIES NOT WHOLLY OWNED BY BHB (LTAT has direct and indirect interests) (cont’d)

5 BPM Purchase of air tickets and travel related services from BTS

DirectorLWK(Note 2)

GMA(Note 3)

Major ShareholderLTATO

1,200

TOTAL 1,200

II. LTAT AND SUBSIDIARIES OF LTAT

1 LTAT Purchase of air tickets and travel related services from BTS


LWK(Note 2)

Major ShareholderLTATP

200

2 PPHM Provision of renovation works from BBM DirectorMGHC(Note 1)

LWK(Note 2)

Major ShareholderLTATQ

68,000

TOTAL 68,200

III. BHB’s ASSOCIATE (LTAT has direct and indirect interests)

1 AHB Purchase of air tickets and travel related services from BTS

DirectorLWK(Note 2)

GMA(Note 3)

Major ShareholderLTATR

4,500

GRAND TOTAL 100,550

O LTAT holds 30.0% of BPM directly. LTAT is indirectly interested in BPM via BHB’s 42.0% indirect interest in BPM through BPSB, which holds 70.0% of BPM. P LTAT direct interest in BTS via LTAT’s 58.43% direct interest in BHB which hold 100% in BTS.Q LTAT holds 100% of PPHM. R LTAT owns 35.42% of AHB directly. LTAT is indirectly interested in AHB via BHB’s 20.7% shareholding in AHB.# The amounts are exclusive of 6% GST.

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Notes:

1. MGHC - Gen. Tan Sri Dato’ Mohd Ghazali Bin Hj. Che Mat (R). He is the Chairman of BHB and Boustead Plantations. As at LPD, he owns 1,560,000 Boustead Plantations shares, 220,000 Pharmaniaga shares and 119,220 Affin shares.

2. LWK - Tan Sri Dato’ Seri Lodin Wok Kamaruddin. He is the Chief Executive of LTAT and Deputy Chairman & Group Managing Director of BHB. He is on the Board of Boustead Plantations,Boustead Properties, Affin Holdings, UAC Berhad and Boustead Petroleum Marketing Sdn Bhd. He is also the Chairman of BHIC, BNS and Pharmaniaga. As at LPD, he owns 28,192,758 BHB shares, 31,381,600 Boustead Plantations shares, 1,051,328 Affin shares, 12,500,148 Pharmaniaga shares, and 2,000,000 BHIC shares. Tan Sri Dato’ Seri Lodin Wok Kamaruddin also owns 5,916,465 shares in Boustead Petroleum Sdn Bhd, a holding company of BPM.

3. GMA - Dato’ Ghazali Mohd Ali. He is a Director of LTAT, BHB, Boustead Properties, Jendela Hikmat, PPHM and Irat. As at LPD, he owns 1,234,000 Boustead Plantations shares, 143,000Pharmaniaga shares, 75,000 BHIC shares, and 10% shareholding in Arkitek MAA as at LPD.

4. AK - Datuk Azzat Kamaludin. He is a Director of BHB, BHIC and BNS. As at LPD, he owns 44,000 BHB shares, 1,550,000 Boustead Plantations shares, 226,260 Pharmaniaga shares, and 350,000 BHIC shares. He is a partner in the legal firm of Azzat & Izzat.

The abovementioned values of transactions are based on accounting records, and the estimated figures during the validity of the Proposals are based on management’s estimate(on the assumption that the current level of operations will continue and all external conditions remain constant) and that the next AGM will be held in March/April 2017.

In view of the time-sensitive and frequent nature of such Recurrent Related Party Transactions, the Board is seeking the approvals on the Proposals which would allow the Group, in their normal course of business, to enter into Recurrent Related Party Transactions with the classes of Related Party set out above, provided such transactions are made at arm’s length and on normal commercial terms and are on terms not more favourable to the Related Party than those generally available to the public and are not detrimental to minority shareholders. Such Recurrent Related Party Transactions will be subject to the review procedures as set out in Section 2.5 of this Circular.

2.4 Amount Due and Owing Under Recurrent Related Party Transactions

The breakdown of the principal sum (without interest) for the total outstanding amount due and owing to the BHB Group under the Recurrent Related Party Transactions as per Section 2.3.1 and 2.3.2 of this Circular which exceeded the credit terms as at 31 December 2015 are as follows:

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2.4 Amount Due and Owing Under Recurrent Related Party Transactions (cont’d)

Company Nature of TransactionsOutstanding Amount

(RM’000)

1 year or less 1 to 3 year

1. BNS Provision of ship building and ship repair works to BHIC 111,932 13,080

2. BNS Provision of computer service from BIT 28 -

3. Irat Rental of hotel building paid by BHR 1,000 -

TOTAL 112,960 13,080

There were no late payment charges imposed by the BHB Group on the above outstanding amounts as they were trade in nature. The Management has and will continuously meet and discuss with the debtors for early settlement of the outstanding amounts. The Board is of the opinion that there will be no recoverability issues as the debtors are related parties with a long-standing business relationship with the Group and has proven to be creditworthy debtors with good payment records.

2.5 Guidelines and Review Procedures for Recurrent Related Party Transactions

2.5.1 Review Procedures

To ensure that Recurrent Related Party Transactions are undertaken on BHB Group’s normal commercial terms, and to supplement the existing internal control procedures of the Group, the Audit Committee is tasked with the review of the procedures of such transactions.

The Audit Committee currently comprises:- Dato’ Wira (Dr.) Megat Abdul Rahman Megat Ahmad (Chairman) Datuk Azzat Kamaludin Datuk Francis Tan Leh Kiah

The following guidelines apply to the review and approval of Recurrent Related Party Transactions to ensure that the terms of the Recurrent Related Party Transactions are fair, reasonable and on normal commercial terms; are not more favourable to the Related Party than those generally available to the public; are not detrimental to minority shareholders and are in the best interest of the Group:-

The Related Parties and interested Directors will be advised that they are subject to the shareholders’ mandate and will also be advised of the review and disclosure procedures.

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2.5 Guidelines and Review Procedures for Recurrent Related Party Transactions (cont’d)

2.5.1 Review Procedures (cont’d)

Records will be maintained by the Company to capture all Recurrent Related Party Transactions, which are entered into pursuant to the Proposals.

The annual internal audit plan shall incorporate a review of the sufficiency and compliance of the guidelines and reviews procedures established to monitor Recurrent Related Party Transactions.

The Board and the Audit Committee shall review the internal audit reports to ascertain that the guidelines and procedures established to monitor Recurrent Related Party Transactions have been complied with.

Any member of the Audit Committee may, as he deems fit, request for additional information pertaining to the transaction from independent sources or advisers, including obtaining of valuations from professional valuers.

If a member of the Board or Audit Committee has an interest (direct or indirect) in any Recurrent Related Party Transactions, he shall abstain from any decision making by the Board or Audit Committee in respect of such transactions and continue to abstain from voting on the resolutions approving the transactions.

Should the Audit Committee during its review form an opinion that the Recurrent Related Party Transactions are not being conducted in accordance with established terms and procedures and/or are not being conducted on an arm’s length basis and on normal commercial terms, or are detrimental to the interests of shareholders, it will advise the Board to convene a General Meeting of shareholders to seek a fresh shareholders’ mandate for the Recurrent Related Party Transactions.

The interested Director or interested Major Shareholder shall also ensure that the persons connected with him abstain from voting on the resolutions approving the transactions.

At least 2 other contemporaneous transactions with unrelated third parties for similar products/services and/or quantities will be used as comparison, wherever possible, to determine whether the price and terms offered to/by the related parties are fair and reasonable and comparable to those offered to/by other unrelated third parties for the same or substantially similar types of products/services and/or quantities. In the event the quotation or comparative pricing from unrelated third parties cannot be obtained (for instance, if there are no unrelated third party vendors/customers of similar products or services, or if the product/service is a proprietary item), the transaction price will be determined by those offered by/to other unrelated parties for substantially similar type of transactions and approved by the respective board of directors of both the transacting entities to ensure that the price and terms of the Recurrent Related Party Transactions are not detrimental to the Group. In addition, the management of the transacting entities shall retain a proper documentation to support the basis in arriving at the relevant transaction prices.

Notwithstanding the above paragraph, the Audit Committee shall review proposals by the management of the transacting entities (including their audit committee if applicable) for onward approval by the Board.

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Group Finance or Group Secretarial shall be informed through a written communication of knowledge of any Related Party Transaction or Recurrent Related Party Transactions which will be entered into or has been entered into. Due care shall also be exercised prior to entering contracts with related party that may give rise to Related Party Transaction or Recurrent Related Party Transactions.

Bursa Listing Requirements pertaining to Related Party Transaction or Recurrent Related Party Transactions are to be communicated to all relevant personnel in company/division who are involved in the day to day operations.

All major shareholders with equity interest exceeding 5% and Directors shall be informed on their responsibilities and obligations in respect to Related Party Transaction or Recurrent Related Party Transactions.

The Group Secretarial Department shall be informed on changes of Director’s interest in other companies, directorship and BHB Group of Companies,

Heads of Division and Heads of Subsidiary shall be informed on their responsibilities and obligations to ensure proper identification, tracking and reporting of Related Party Transaction or Recurrent Related Party Transactions.

Tracking of the value of Related Party Transaction or Recurrent Related Party Transactions shall be done for the purpose of disclosure in the Annual Report. Where the transaction value exceed 10% or more of the Mandated Amount, the respective Head of operating units is responsible to notify and provide explanation to Group Secretarial Department so that immediate announcement to Bursa Securities can be made,

For Related Party Transaction or Recurrent Related Party Transactions that are not included in the mandate but are expected to exceed RM1 million in a 12 months period, respective Head of operating units is responsible to track transaction values for immediate announcement to Bursa Malaysia.

2.5.2 Guidelines

There are no specific thresholds for approvals of Recurrent Related Party Transactions within the BHB Group. However, there are commercial considerations which the BHB Group takes into account before entering into transactions for the sale/supply of goods and provision of services, in the ordinary course of business:-

The ability and track record of the purchaser to pay for the goods supplied or services provided;

Whether past experience and working relationship with the purchaser has been satisfactory;

The BHB Group’s pricing for the goods to be provided or supplied and/or received or purchased is negotiated between the BHB Group and Related Party based on the prevailing market prices as agreed with unrelated third parties;

The terms are no more favourable to the Related Party than those extended to unrelated third parties and available to the public and the Recurrent Related Party Transactions are not detrimental to minority shareholders;

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The transactions are provided after taking into account factors such as pricing, quality, delivery schedules and, where applicable, preferential rates, rebates or discounts accorded for bulk purchases, the terms offered are fair and reasonable and in the BHB Group’s commercial interests;

The competitiveness in pricing;

The standard and quality of the goods/services and whether it meets the requirements of the BHB Group;

The responsiveness and level of service provided by the goods or service providers and whether past experience and working relationship has been satisfactory; and

The track record and competence of the goods or service provider and whether the goods or service provider has sufficient resources to perform its obligations.

The BHB Group would only enter into transactions with the relevant parties based on the above criteria, regardless of whether or not the party is related.

2.6 Statement by Audit Committee

The Audit Committee of the Company has seen and reviewed the procedures mentioned in Section 2.5 above and are satisfied that:-

(i) the Group has in place adequate procedures and processes to monitor, track and identify Recurrent Related Party Transactions in a timely and orderly manner, and that these procedures and processes are reviewed annually; and

(ii) the procedures above are sufficient to ensure the terms of the Recurrent Related Party Transactions are fair, reasonable and on normal commercial terms; are not more favourable to the Related Party than those generally available to the public; are not detrimental to minority shareholders and are in the best interest of the Group.

2.7 Disclosure

Disclosure has been made in the 2015 Annual Report of the Company of the aggregate value of transactions conducted pursuant to the 2015 Shareholders’ Mandate. Similar disclosure will be made in the Annual Report for the subsequent financial year during which the shareholders’ mandate and additional shareholders’ mandate for recurrent related party transaction are in force, providing amongst others, the following information:-

i) The type of Recurrent Related Party Transactions made; and

ii) The names of the Related Parties involved in each type of the Recurrent Related Party Transactions made and their relationship with the Company.

3. RATIONALE AND BENEFIT

3.1 Rationale of the Proposed Renewal of Shareholders’ Mandate and Proposed Additional Shareholders’ Mandate

The Proposals are intended to enhance the Group’s ability to pursue business opportunities, which are time-sensitive in nature, and will eliminate the need to announce, or to announce and convene separate general meetings on each occasion to seek shareholders’ prior approval for the entry by the relevant company in the Group into such transactions. This will

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substantially reduce the expenses associated with the convening of general meetings on an ad hoc basis, improve administrative efficacy considerably, and allow manpower resources and time to be channelled towards attaining other corporate objectives.

3.2 Benefits to the BHB Group from Transacting With the Related Parties

The Recurrent Related Party Transactions entered into by the BHB Group are intended to meet business needs at the best possible terms. The BHB Group should be able to have access to all available markets and products and services provided by all vendors including its Related Parties. Transacting with its Related Parties also enhances the ability to explore beneficial business opportunities within the BHB Group, which will be of benefit to all the companies within the BHB Group. In most instances, companies within the BHB Group have a better understanding of each other’s business needs, thus providing a platform where all parties can benefit from relatively cheaper transaction costs.

4. CONDITION OF THE PROPOSALS

The Proposals are conditional upon the approval being obtained from the shareholders of BHB at the forthcoming AGM.

5. FINANCIAL EFFECTS OF THE PROPOSALS

The Proposals are not expected to have any effect on the issued and paid-up capital, earnings and net tangible assets of the BHB Group.

6. DIRECTORS' AND MAJOR SHAREHOLDERS’ INTERESTS

The direct and indirect shareholding of the interested Major Shareholders, interested Directors of the Company and Persons Connected to them as at LPD are as follows:-

Name Direct Shareholding Indirect Shareholding

No of Shares % No of Shares %

Major ShareholderLembaga Tabung Angkatan Tentera 604,223,509 58. 43 - -

Interested Directors

Tan Sri Dato’ Seri Lodin Wok Kamaruddin

28,192,758 2.73 - -

Datuk Azzat Kamaludin 44,000 - - -

Gen. Tan Sri Dato’ Mohd Ghazali Bin Hj. Che Mat (R)

Dato’ Ghazali Mohd Ali

-

-

-

-

-

-

-

-

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Gen. Tan Sri Dato’ Mohd Ghazali Bin Hj. Che Mat (R), Tan Sri Dato’ Seri Lodin Wok Kamaruddin, Datuk Azzat Kamaludin and Dato’ Ghazali Mohd Ali (“the Interested Directors”), being the interested directors as mentioned in section 2.3 above have abstained and will continue to abstain from deliberations and voting at the board meetings with regard to the Proposals. The Interested Directors together with LTAT will also abstain from voting inthe resolutions pertaining to the Proposals in respect of their direct and indirect interest in BHB at the AGM.

The Interested Directors and LTAT have undertaken that they will ensure that the Persons Connected with them as disclosed above will abstain from voting on the resolutions relating to the Proposals at the AGM to be convened.

Save as disclosed above, none of the other Directors and/or Major Shareholder of BHB and/or Persons Connected to them have any interest, direct or indirect, in the Proposals.

7. DIRECTORS' RECOMMENDATION

The Directors (except for the Interested Directors), after careful deliberation on the Proposals, are of the opinion that the Proposals are in the best interests of the Company. Accordingly, the Directors (except for the Interested Directors) recommend that you vote in favour of the resolutions pertaining to the Proposals to be tabled at the forthcoming AGM.

8. AGM

The fifty-fourth AGM of the Company will be held at The Royale Ballroom, Level 2, The Royale Chulan Damansara, 2 Jalan PJU 7/3, Mutiara Damansara, 47810, Petaling Jaya, Selangor on 4 April 2016 at 9.30 a.m, for the purpose of considering and if thought fit, passing the Ordinary Resolutions as set out in the Notice of AGM to approve the Proposals.

If you are unable to attend and vote in person at the AGM, you are requested to complete, sign, and return the enclosed Form of Proxy in accordance with the instructions therein as soon as possible and in any event so as to arrive at the Share Registrar’s office of the Company not less than 48 hours before the time set for the AGM. The lodging of the Form of Proxy does not preclude you from attending and voting in person should you subsequently wish to do so.

9. FURTHER INFORMATION

Shareholders are advised to refer to the attached appendices for further information.

Yours faithfully For and on behalf of the Board of Directors BOUSTEAD HOLDINGS BERHAD

Dato’ Wira (Dr.) Megat Abdul Rahman Megat AhmadSenior Independent Non-Executive Director

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APPENDIX I FURTHER INFORMATION

1. RESPONSIBILITY

This Circular has been seen and approved by the Directors of BHB and they collectively and individually accept full responsibility for the accuracy of the information given, and confirm that, after making all enquiries as are reasonable in the circumstances and that to the best of their knowledge and belief, there are no other facts and information the omission of which, would make any statement herein misleading.

2. MATERIAL LITIGATION

Save as disclosed below, neither BHB nor its subsidiary companies are engaged in any material litigation, claims or arbitration either as plaintiff or defendant or otherwise, nor are the Directors of BHB aware of any proceedings pending or threatened against BHB and/or its subsidiary companies, or of any facts likely to give rise to any proceedings which might materially or adversely affect the position or business of BHB and/or its subsidiary companies.

Ipoh High Court Suit No. 22NCVC-193-08/2012 Ingat Kawan (M) Sdn Bhd (“Ingat Kawan” or “Plaintiff”) -v- BNS

BNS, a subsidiary of our Company had, on 4 September 2012, been served with a Writ of Summons by one Ingat Kawan. The Writ of Summons was filed in the Ipoh High Court on 10 August 2012.

Under the said Writ of Summons, Ingat Kawan is claiming against BNS for general damages, special damages of RM50.0 million, interest at 10% per annum on the said amount of RM50.0 million calculated from 7 September 2011 until full settlement, interest at 8% per annum on the said amount of RM50.0 million calculated from the date of filing of the Writ of Summons until full settlement, costs and other relief that the Court deems fit, for an alleged breach by BNS of a contract for removal of underground cables at BNS’s shipyard in Lumut.

BNS does not recognise the validity of the alleged contract. The staff members that were involved in the alleged contract have either been dismissed or left the company. BNS has also lodged a police report with regards to the incident.

BNS had on 11 September 2012 filed the Memorandum of Appearance and on 4 October 2012 BNS filed its Statement of Defence. BNS had also on the same date filed a counter-claim against Ingat Kawan and 5 former BNS staff for:

i) the Court’s declaration that the contract is invalid; and ii) the Plaintiff to provide an account of the stolen cable if the Plaintiff has sold the cable;

or iii) general damages; and iv) exemplary damages; and v) aggravated damages; and vi) interest of 5% per annum of the amount in paragraphs (c), (d) and (e) from 5 September

2011 until full settlement; and vii) costs; and viii) other reliefs that the Court deems fit.

BNS’s claims against its 5 former staff are for breach of fiduciary duties, fraud and acting against the law.

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The High Court had, on 30 November 2012, dismissed Ingat Kawan’s objections to BNS’s addition of five (5) co-defendants in BNS counter-claims.

On 14 March 2013, the High Court allowed BNS’ application to strike out Ingat Kawan’s claim. Ingat Kawan appealed to the Court of Appeal against this decision, and on 11 November 2013, the appellate Court allowed the appeal and ordered the case to be tried at the High Court. However, until to-date, the High Court has not fixed a date for the trial.

On 10 December 2013, BNS filed an application for leave to appeal to the Federal Court against the 11 November 2013 decision of the Court of Appeal. Hearing of this leave application has been adjourned pending the issuance of the Grounds of Judgment by the Court of Appeal. In the meantime, the Federal Court fixed the matter for case management on 21 March 2016.

As regards the defamation action by Ingat Kawan and another person, the High Court had on, 30 November 2012, allowed BNS’s application to strike out the claim without liberty to file afresh. In view of this, Ingat Kawan will not have any recourse to revive this defamation suit against BNS.

The Directors, in consultation with the solicitors are of the view that BNS has a good case in this action.

3. MATERIAL CONTRACTS

Save as disclosed below, no material contracts, not being contracts entered into in the ordinary course of business, have been entered into by BHB or its subsidiary companies within the past two (2) years preceding the date of this Circular:

(i) On 17 December 2013, BHB executed agreements to establish a hybrid equity being Junior Islamic Medium Term Notes (“Junior Sukuk Musharakah”) of up to RM1.2 billion in nominal value (“Junior Sukuk Programme”). Unrated and to be implemented under the Securities Commission’s Guidelines on Sukuk, the Junior Sukuk Programme received the approval of the Securities Commission on 15 November 2013. The proceeds to be raised shall be utilized amongst others to finance capital expenditures, investments and/or refinancing of borrowings. The amount issued are as follows;

a) BHB had, on 23 December 2013, issued a total of RM683.0 million of Junior Sukuk Musharakah;

b) BHB had, on 3 June 2014, made the second issuance of RM51.0 million in nominal value of Junior Sukuk Musharakah;

c) BHB had, on 30 June 2014, made the third issuance of RM150.0 million in nominal value of Junior Sukuk Musharakah;

d) BHB had on 4 August 2014, made the fourth issuance of RM200.0 million in nominal value of Junior Sukuk Musharakah; and

e) BHB had on 24 November 2014, made the fifth issuance of RM50.0 million in nominal value of Junior Sukuk Musharakah. Including this issuance, BHB has issued a total of RM1,134.0 million of Junior Sukuk Musharakah pursuant to the Junior Sukuk Programme of up to RM1.2 billion.

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f) BHB had on 14 April 2015 made the sixth issuance of RM66.0 million in nominal value of Junior Sukuk Musharakah.

(ii) An Agreement dated 17 July 2014 between Boustead Naval Shipyard Sdn Bhd and the Ministry of Defence Malaysia (acting on behalf of the Government of Malaysia) to design, construct, equip, install, commission, integrate, test and trials, and deliver six (6) units of Second Generation Patrol Vessels with Littoral Combat Ship capability for the Royal Malaysian Navy at a contract value of RM9 billion.

(iii) Joint Venture Agreement dated 10 October 2014 entered into between Boustead Curve Sdn Bhd and Themed Attractions and Resorts Sdn Bhd, a wholly owned subsidiary of Cameron Highlands Holdings Sdn Bhd which in turn is a wholly-owned subsidiary of Khazanah Nasional Berhad, to form a joint venture company known as Rakan Riang Pte Ltd for the purpose of operating one or more educational and entertainment facilities in Singapore.

(iv) Conditional Share Sale and Purchase Agreement (“SPA”) dated 27 February 2015 between LTAT (through Irat Properties Sdn Bhd), a 98.33% subsidiary of LTAT and A.T.E.S Sdn Bhd for the acquisition of the entire equity interest in ATES from its shareholders and 210,000 Islamic Redeemable Non-cumulative Preference Shares in the share capital of ATES (RNCPS) from the RNCPS holder (collectively, “ATES Vendors”). The SPA has become unconditional and the acquisition was completed on 14 April 2015.

(v) Conditional Share Sale and Purchase Agreement (“SPA”) dated 27 February 2015 between LTAT (through Irat Properties Sdn Bhd), a 98.33% subsidiary of LTAT and Beta Tegap Sdn Bhd for acquisition of the entire equity interest in Beta Tegap. The SPA has become unconditional and the acquisition was completed on 17 April 2015.

(vi) Subscription of 60,000,000 new ordinary shares of RM1.00 each in Irat Properties Sdn Bhd by BHB for a cash consideration of RM127.8 million on 14 April 2015 (First Subscription”).

(vii) Subscription of 33,333,333 new ordinary shares of RM2.13 each in Irat Properties Sdn Bhd by BHB for a cash consideration of RM71 million on 14 April 2015 (“Second Subscription”).

(viii) Subscription of 24,037,559 new ordinary shares of RM2.13 each in Irat Properties Sdn Bhd by BHB for a cash consideration of RM51.2 million on 28 April 2015 (“Third Subscription”).

(ix) Sale and Purchase Agreement dated 10 June 2015 between Boustead Curve Sdn Bhd (“B.Curve”), wholly-owned subsidiary of BHB and Pharmaniaga Logistics Sdn Bhd (“PLSB”), a wholly-owned subsidiary of Pharmaniaga Berhad which is also a subsidiary of BHB for the disposal of a leasehold property owned by B.Curve to PLSB for a cash consideration of RM23,320,000 (inclusive of Goods and Services Tax). The disposal was completed on 9 September 2015.

(x) Conditional Sale and Purchase Agreement dated 17 December 2015 entered into between Johan Ceramics Berhad (“JCB”), an indirect wholly owned subsidiary of BHB and Kim Hin Ceramic (Seremban) Sdn Bhd for disposal of property and assets in JCB for an aggregate cash consideration of RM28 million.

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(xi) Conditional Share Sale Agreement dated 29 December 2015 entered into between Bakti Wira Development Sdn Bhd (“BWSB”), a wholly owned subsidiary of BHB and Cascara Sdn Bhd (“Cascara”) for disposal of 30% equity interest held in Jendela Hikmat Sdn Bhd by BWSB to Cascara for a cash consideration of RM180 million.

4. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents will be available for inspection at the Registered Office of Boustead Holdings Berhad at 28th Floor, Menara Boustead, 69 Jalan Raja Chulan, 50200 Kuala Lumpur, during normal business hours on any weekday (except public holidays) from the date of this Circular up to and including the date of the AGM:

(i) The Memorandum & Articles of Association of BHB;

(ii) The audited consolidated accounts of BHB for the last (3) financial years ended 31st

December 2015, 31st December 2014 and 31st December 2013;

(iii) The relevant cause papers in respect of material litigation referred to in Paragraph 2;

(iv) Material contracts referred to in Paragraph 3 above.

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APPENDIX II

ADDRESS OF PROPERTIES RENTED

1. The transactions are in compliance with Paragraph 3.2(c) of Practice Note 12 of the Listing Requirements, that is the lease period does not exceed three years and does not involve payments of rental on a lump sum basis.

2. The address of properties rented by the Related Parties as set out in Section 2.3 herein are as follows:-

Section Ref. TransactingSubsidiary / Associate

Address

2.3.1 I(1)(b)

I(1)(c)

1(2)(c)

1(2)(g)

1(4)(b)

1(5)(c)

BNS

BHIC

BNS

BHIC

Boustead Plantations

Pharma

Menara Boustead KL – 69, Jalan Raja Chulan, 50200 KL.

(i) Bukit Malut, Mukim Kedawang, 07000, Langkawi, Kedah

(ii) Menara Boustead KL – 69, Jalan Raja Chulan,50200 KL.

(iii) Pangkalan TLDM, 32100 Lumut, Perak

Block 3502, Enterprise Building 2, Jalan Teknokrat 4, Cyber 5, 63000 Cyberjaya Selangor

Menara Boustead Penang- 39 Jalan Sultan Ahmad Shah, 10050 Georgetown, Penang

Menara Boustead KL – 69, Jalan Raja Chulan, 50200 KL.

Lot 49, No. 11, Jalan Ragum 15/17, Seksyen 15, 40200 Shah Alam, Selangor.

II(1)(a) AHB Menara Boustead KL – 69, Jalan Raja Chulan, 50200 KL.

Menara Affin KL – 80, Jalan Raja Chulan, 50200 KL.

The Curve – No. 6, Jalan PJU 7/3, Mutiara Damansara, 47810 Petaling Jaya, Selangor.

II(2) Irat Royale Chulan Hotel, Jalan Conlay, 50450 KL.

2.3.2 I(2)(e) BAH Suite 19.04-05, Level 19 Wisma Goldhill, No. 67, Jalan Raja Chulan, 50200 Kuala Lumpur

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