Final Jv Agreement Dated 14.07.2011 (Mps,Integral Acres & Pembangunan Samudera)

JOINT VENTURE AGREEMENT BETWEEN MAJLIS PERBANDARAN SANDAKAN, INTEGRAL ACRES SDN BHD & PEMBANGUNAN SAMUDERA (SABAH) SDN BHD

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JOINT VENTURE AGREEMENT

THIS JOINT VENTURE AGREEMENT is made on the day of ....................... 2011

BETWEEN

MAJLIS PERBANDARAN SANDAKAN, a Local Authority established pursuant to Section 3 of the Local Government Ordinance, 1961 and having its office at Wisma Perbandaran, P.O. Box No. 221, 90702 Sandakan, Sabah, Malaysia (hereinafter called MPS) which expression shall where the context so admits include its successors and assigns of the first part;

AND

INTEGRAL ACRES SDN BHD (Company No. 672818-M), a company incorporated in Malaysia and having its registered address at Lots 21, 22 and 23, 1st Floor, Bandar Tyng, Mile 6, Jalan Utara, 90000 Sandakan, Sabah (hereinafter called the Company) which expression shall where the context so admits include its successors and assigns of the second part;

AND

PEMBANGUNAN SAMUDERA (SABAH) SDN BHD (Company No. 807265-T) a Company incorporated in Malaysia having its registered address at Unit 7, 10th Floor, Wisma Perindustrian, Jalan Istiadat, Likas, 88400, Kota Kinabalu, Sabah, Malaysia (hereinafter referred to as the Developer) which expression shall where the context so admits include its successors and permitted assigns of the third part.

WHEREASA.MPS is the registered owner of a parcel of land described as and contained in Town Lease No. 077580879 measuring 100 acres (more or less) situated at BDC along Buli Sim-Sim Road, Sandakan (hereinafter referred to as the Said Land). A survey plan showing in red the boundaries of the Said Land is found in Annexure A-1 herein.

B.In the interests of the people of Sabah and in particular the relevant communities in Sandakan and their development, by an agreement dated 30 March 2007 made between the MPS of the one part and the Company of the other part (hereinafter referred to as the Resettlement Agreement), MPS, inter alia, agreed to appoint the Company to plan, finance, develop and construct on the Said Land measuring one hundred (100) acres land (more or less) at the cost and expense of the Company, of which twenty (20) acres more or less of the Said Land shall be developed for MPS (hereinafter referred to as the Resettlement Land marked in blue on the survey plan in Annexure A-2 herein) and MPS is entitled to receive from the Company, among other things, one thousand (1,000) units of low cost five (5) storey walk up apartments as part of its resettlement programme (hereinafter referred to as the Resettlement Scheme), as the consideration for the balance eighty (80) acres of land more or less (hereinafter referred to as the Consideration Land marked in green on the survey plan in Annexure A-3 herein).C. The Developer represents that it has been granted the approval by the Sabah Economic Development and Investment Authority (hereinafter referred to as SEDIA) on 14 May 2009 to develop certain identified area in Sandakan as part of the Sabah Development Corridor (hereinafter referred to as the SDC) and also represents that it is qualified to be granted financial assistance, privileges and incentives by the Government of the Federation of Malaysia under its Public-Private Sector Partnership initiative.

D.Pursuant to the Resettlement Agreement, the Company had arranged with Sabah Development Bank Berhad (hereinafter referred to as SDB) a bank facility amounting to RM 104 million comprising RM 51 million in the form of a term loan (hereinafter referred to as the Term Loan) that has been fully disbursed and utilised by the Company, and RM 53 Million in the form of a bank guarantee (BG 2011-018) dated 12 April 2011 for the guaranteed sum of RM53 million in favour of MPS and upon the terms, conditions and provisions therein contained (hereinafter referred to as the Bank Guarantee), and for providing the bank facilities a charge over the said Land was granted to SDB vide Memorial Number 20293986 (hereinafter referred to as the the Charge).

E.The Company has been unable to fully perform its obligations under the said Resettlement Agreement within the time agreed and has been unable to fully adhere to its obligation towards SDB with respect to all of the banking facilities granted to the Company. There is a serious need to improve the financial viability of the proposed development on the said Land and to ensure the completion of the Resettlement Scheme (hereinafter referred to as the Current Situation).

F. To rectify the Current Situation, the Company proposed to MPS the additional involvement of the Developer in performing and delivering the obligations under the Resettlement Agreement, and MPS agreed to accept the proposal by the Developer to reconceptualise the original development plan and restructure the feasibility and financial viability of the proposed development of the Said Land and have the Said Land consolidated with several other parcels of land identified by the Developer and to be developed as part of the SDC, together with additional commitments to be performed by the Company and the Developer (hereinafter referred to as the Project)

G.The Developer is desirous of further enhancing the value of the Project under the reconceptualised and consolidated plan (hereinafter referred to as the Master Development Plan as shown in Annexure B-1 attached herein), and MPS and the Company are desirous to have the participation of the Developer in the Project upon the terms and conditions herein described.H.MPS and the Company hereby agree, declare and confirm that all the terms and conditions of the Resettlement Agreement are still valid and subsisting in all respects (without prejudice to the parties right and liability in respect of any antecedent performance or breach todate), but have decided to allow the additional participation of the Developer, subject to the terms and conditions of this Agreement (hereinafter referred to as this JV Agreement), and where there is any conflict between the terms and conditions contained in the Resettlement Agreement and this JV Agreement, the parties hereto agree that the terms and conditions of this JV Agreement herein described shall prevail.I.The parties hereto further agree that the terms and conditions of this JV Agreement shall review, revise, relocate and improve certain terms and condition of the Resettlement Agreement and shall form the basis for the implementation of the Project by the Company and the Developer as hereinafter contained.

IT IS NOW AGREED as follows:

1. DEFINITIONS AND INTERPRETATION

1.1 Definitions

In this Agreement the following words and expressions shall have the meaning ascribed to them below except where the context otherwise requires: Construction Works means all buildings and constructions to be carried out and has been completed from time to time forming part of MPSs Entitlements as provided under Clause 5.3 of this JV Agreement.1.2Words importing the masculine gender include the feminine andneuter genders andvice versa andwords importing the singular number include the plural numberandviceversa.

1.3 References to clauses are tobe construed as references toclauses of this Agreement.

1.4 References tothe provisions of any legislationinclude a reference toany statutory modificationandreenactmentthereof.

1.5 The headings of the various clause of this Agreement are for convenience of reference only and shall not modify, define or limit any of the terms or provisions hereof.

1.6 The Recitals and Annexures tothis Agreement form part of andshall be deemedtobe incorporatedinthisAgreement.

2 PURPOSE OF THE JOINT VENTURE

The parties hereto agree to enter into this joint venture with the main purpose of working together to carry out the necessary efforts that will resolve the Current Situation and ensure the successful implementation and completion of the Project in accordance with the Master Development Plan and upon terms and conditions described herein. The parties also acknowledge that the overriding objective of the Project and the Master Development Plan is to advance the social and economic development of the people of Sabah and in particular the relevant communities of Sandakan, and shall at all times seek to advance such objective in the performance of this JV Agreement.3 BASIS OF JOINT VENTUREThe parties hereto agree that the joint venture described herein shall be on the following basis:3.1 Authority to Develop

In consideration of the Company and the Developer securing and causing the transfer of ownership of several parcels of land held under Title Numbers TL077582819, TL077582828 and TL077582837 altogether measuring more or less Thirty (30) acres in the locality of Sungai Mangkalinau in the District of Sandakan to MPS (hereinafter referred to as the Private Land edged blue in Annexure C herein) and upon the undertaking by the Company and the Developer to deliver the specific obligations of the Company to MPS under the Resettlement Agreement as well as all the additional commitments as described in this JV Agreement, MPS hereby agree to appoint and authorise the Company and the Developer to jointly develop and carry out all the necessary and relevant implementation works on the Said Land and the Private Land according to the Master Development Plan of the Project as approved by MPS to its full completion.

3.2 Exchange of Resettlement Land Notwithstanding anything to the contrary in this JV Agreement, it is hereby agreed that in consideration of MPS agreeing to execute this JV Agreement, the ownership of the Private Land shall be transferred to MPS, free from all encumbrances (whether in law or in equity), in accordance with the procedures provided in the remainder of this Clause and that the Private Land shall henceforth remain the absolute property of MPS regardless of whether this JV Agreement is subsequently completed or terminated before completion. The Company and the Developer hereby undertake to cause the registered owner(s) of the Private Land to execute the Memorandum of Transfer of the Private Land in favour of MPS and deliver the same, together with all documents necessary to effect the transfer (such as evidence of payment of up-to-date quit rent and house assessment), to the solicitors of MPS, M/s Peter Lo & Co., within thirty (30) days from the date hereof for stamping and lodgement of the registration of the said transfer to MPS free from all encumbrances. Parties hereby agree that the successful registration of the transfer of the Private Land to MPS free from all encumbrances (whether in law or in equity) is condition precedent to the validity or enforceability of this JV Agreement. In the event that the said transfer is discovered to be defective or not entirely free from encumbrances not due to the fault of MPS, the parties hereby agree that MPS shall be entitled to forthwith terminate this JV Agreement or hold any or all part of this JV Agreement in suspension, whereupon the Company and the Developer shall be obligated and liable to, entirely at MPSs election:-a) Cause the registration of the Private Land to be perfected and to rectify or clear all such encumbrances to ensure that MPS has a perfect legal and beneficial title to the Private Land free from all encumbrances; orb) Provide another piece of land of equivalent size and located within a 5km radius of the Said Land as substitute for the Private Land suitable for all the Construction Works to be carried out under the Private Land on the same terms and conditions as above (including this Clause itself); or

c) Compensate MPS with a sum equivalent to the market value of a land of equivalent size and location as paragraph (b) above within 30 days from the receipt of a written demand by MPS, which market value shall be conclusively determined by a licensed valuer in Malaysia as appointed by MPS at MPSs sole discretion.

3.3 Utilisation of the Bank Guarantee

MPS has demanded the payment of RM53 million under the Bank Guarantee by way of a letter dated 20 May 2011. MPS hereby confirms and agrees that it has withdrawn the letter of demand dated 20 May 2011 and has informed SDB accordingly. To facilitate the completion of the Resettlement Scheme and the Apartments as described in Clause 3.4 hereinbelow, MPS, the Company and the Developer agree to have the Company to make the necessary arrangements to enable MPS to utilize the Bank Guarantee for the construction of the Resettlement Scheme and the Apartments and/or other development on the said Land in the manner stated hereinbelow PROVIDED THAT:-

a) the amount to be utilized pursuant to this Clause shall be RM53 million from the Bank Guarantee and any cost of materials and / or any logistics costs as well as all other cost and expenses needed for the completion and delivery of MPSs Entitlements in excess of the same shall be fully borne by the Company and the Developer;

b) Upon the request in writing by the Company and/or the Developer for the purchase of the relevant building materials, MPS shall have the sole discretion to decide on or agree to the purchase of the said materials, the supplier or manufacturer of such materials, the price and all relevant terms and conditions;

c) Upon the request in writing by the Company and/or the Developer for the purchase of the relevant building materials, any payment for the said purchase shall be made directly by MPS to the supplier or manufacturer or their authorised agents and any payment so certified by an authorised officer of MPS to have been paid to the supplier or manufacturer of the building materials used for the works carried out under this JV Agreement shall be conclusive evidence that the amount paid therein has complied with and satisfied the obligation of MPS under this Clause save and except in the case of fraud or illegality on the part of MPS itself (excluding any fraud by any individual officer of MPS);d) MPS shall have the sole discretion to take sufficient time as it deems fit to decide on matters stated at paragraph (a) above and/or to withhold any payment to any party in the event that MPS has any reasonable ground to dispute with the relevant party, and it shall be the separate and independent obligation of the Company and the Developer to proceed and continue with the works under this JV Agreement until completion notwithstanding any such delay PROVIDED THAT if and only if the progress of the works has actually been materially affected by such delay in payment by MPS, the relevant completion date(s) for the relevant portion(s) of the works actually so affected shall be extended according to the number of days during which MPS has actually been late in making payment to the relevant party compared to the date when such payment is actually due and payable. Save and except as provided aforesaid MPS shall not be liable for any loss or damage or inconvenience to the Company or the Developer including for any delay or loss of time or additional cost and expense caused by MPS as a result of or arising from the exercise of any of the rights or powers provided to MPS under this Clause 3.3.e) The schedule for the utilization of the Bank Guarantee or any part thereof shall be in accordance with the schedule provided by the supplier of the building material referred to hereinabove and approved by MPS as shown in Annexure D-1 and Annexure D-2 herein.

f) MPS, the Company and the Developer expressly agree and confirm that the utilization of the Bank Guarantee or part thereof from time to time in accordance with Clause 3.3 herein shall not be deemed as a default on the part of the Company or the Developer of the terms of this JV Agreement.

g) MPS, the Company and the Developer agree that the Bank Guarantee shall be solely utilized for the purchase of building materials for the Resettlement Scheme and the Apartments and/or other development on the said Land in the following manner:-

(i) Thirty (30%) percent of the Bank Guarantee shall be utilized for the purchase of building material for the Resettlement Scheme; and

(ii) Seventy (70%) percent of the Bank Guarantee shall be utilized for the purchase of building material for the Apartments and/or other development on the said Land.

h) The parties hereto acknowledge that pending the formalities allowing the utilization of the RM53 million Bank Guarantee in the manner stated hereinabove, the Company shall inject the sum of RM3 million or such other sum mutually agreed upon by the parties hereto to urgently commence the Resettlement Scheme and the Apartments and/or other development on the Said Land. The parties hereto agree that upon the Bank Guarantee or part thereof being made available for the purchase of building materials, the Company shall be entitled to be reimbursed forthwith the sum of RM3 million or such other sum actually expended by it upon submission of the relevant documents to the satisfaction and approval of MPS.

i) For the avoidance of doubt, it is agreed and understood that the Company and the Developer shall carry out and complete the Resettlement Scheme in accordance with the terms of this JV Agreement notwithstanding that the Bank Guarantee of RM53 million or part thereof utilized for the purchase of building material for the Resettlement Scheme in accordance with Clause 3.3(g)(i) hereinabove shall not be sufficient to complete the Resettlement Scheme.

j) The Company and the Developer have agreed with MPS that it shall be a condition precedent to this JV Agreement that:-

(i) The Company shall provide its Corporate Guarantee to MPS to guarantee that in the event that the Company or the Developer shall fail to complete the Resettlement Scheme in accordance with this JV Agreement, it shall repay to MPS the amount equivalent to the sum of 70% of the Bank Guarantee which had been utilized to purchase building material in accordance with Clause 3.3(g)(ii) hereinabove;

(ii) The Company shall procure or cause to be given the Personal Guarantees of Lim Nyuk Foh (NRIC No. 640430-12-5379) and Dato Azlan Bin Nasir Yeo Guan Hock (NRIC No. 800214-12-5171) in favour of MPS to guarantee that in the event that the Company or the Developer shall fail to complete the Resettlement Scheme in accordance with this JV Agreement, they shall jointly and severally repay to MPS the amount equivalent to the sum of 70% of the Bank Guarantee which had been utilized to purchase building material in accordance with Clause 3.3(g)(ii) hereinabove;

(iii) Upon the sale of not less than 50% of the Apartments which shall be evidenced by the execution of the Sale and Purchase Agreements in such regard, the Developer shall provide a Corporate Guarantee to MPS, or at its sole discretion provide an equivalent amount in cash to MPS, to guarantee that in the event the Company or the Developer shall fail to complete the Resettlement Scheme in accordance with the terms of this JV Agreement, it shall repay to MPS the amount equivalent to the sum of the Bank Guarantee which had been utilized to purchase building material in accordance with Clause 3.3(g)(ii) hereinabove;

(iv) For the avoidance of any doubt, the parties hereto agree declare and confirm that the Corporate Guarantees and Personal Guarantees referred to in Clause 3.3(j) (i), (ii) & (iii) hereinabove, jointly and severally, shall not entitle MPS to recover pursuant thereto the sum in excess of 70% of the Bank Guarantee.

k)For the avoidance of doubt, the Company and the Developer confirm and declare that the Bank Guarantee shall be assigned by MPS to Public Bank Berhad or such other financial institution to be nominated by the Company to be utilized in the manner stated in Clause 3.3(g) and that the amount to be utilized for the Resettlement Scheme shall not be a charge or be used for payment of any interest incurred or outstanding to Public Bank Berhad or such other financial institution to be nominated. The Company shall service all interest and or finance charges due to Public Bank Berhad or such other financial institution to be nominated whenever the same is due and payable.

3.4 Development of the Resettlement Land

The parties hereto agree that the Resettlement Land, upon the transfer of the Private Land to MPS, shall be developed by the Company and/or the Developer, entirely at their own cost and expense and risk and liability without any corresponding liability of MPS, with apartments comprising inter-alia of apartment buildings, sports and recreation facilities buildings, covered car parking bays, food and catering facilities (hereinafter referred to as Apartments) as shown in the proposed plan in Annexure B-2 herein, together with all the other necessary components, buildings, structures and infrastructures not currently identified in the plan in the said Annexure but which are subsequently deemed necessary or required by the relevant competent federal or state departments or authorities such as the Ministry of Higher Education, Ministry of Health or MPS itself acting in its capacity as a Local Authority. 3.5 Sale of the Apartments

The Apartments developed by the Company and/or the Developer on the Resettlement Land shall be for the purposes of selling to private and/or institutional investor(s) by MPS as arranged by the Company and/or the Developer at the price and terms and conditions subjectively deemed most satisfactory and suitable to MPS and part of the proceeds from the sale shall be used for the repayment or part repayment of the loan and/or the Bank Guarantee provided by SBD to the Company and MPS respectively PROVIDED ALWAYS that all the proceeds of the sale shall be paid into a designated bank account where MPS is the main signatory (hereinafter referred to as the Development Account) and the Company shall obtain the agreement of SDB for the use of such Development Account.MPS, the Company and the Developer agree and confirm that the proceeds from the sale of the Apartments in the Development Account shall be utilized by the Company and/or the Developer in the following manner:-

(a)Twenty (20%) percent of the proceeds from the sale of the Apartments shall be utilized to repay SDB for the loan and the Bank Guarantee; and,

(b)Thirty (30%) percent of the proceeds from the sale of the Apartments shall be utilized to reimburse or offset the cost of the construction of the Resettlement Scheme; and,

(c)Fifty (50%) percent of the proceeds from the sale of the Apartments shall be utilized for the construction of the Apartments and/or other development on the said Land.

The surplus, if any, after the full repayment of the loan and/or the Bank Guarantee provided by SBD to the Company in such Development Account shall fully be utilised to fulfil the performance duties and obligations of the Company and/or the Developer towards MPS under this JV Agreement. However, it is hereby agreed that any surplus released to the Company or the Developer shall not be deemed as a confirmation or indication that the said performance duties and obligations of the Company and/or the Developer towards MPS have been completed or fulfilled, nor does it constitute a waiver of the same nor acquiescence in any breach or non-performance of the same.

4. Obligations of the Company

4.1Fulfilled Obligations by the Company

The parties hereto recognise and accept that the Company has fulfilled the following obligations as agreed under the Resettlement Agreement:

(a) the delivery to MPS of the bank guarantee payable on demand in the sum of RM53,000,000.00 which is being held by MPS that shall be kept valid by the Company until the sub-division premium in respect of the Resettlement Land and all performance duties and obligations of the Company and/or the Developer have been fully complied with;(b) the payment of all land premiums for the issuance of the master title for the Said Land; 4.2 Specific Obligations of the Company(a) The Company shall make all the necessary arrangements with Public Bank Berhad, or such other financial institution to be nominated by the Company, to obtain a Bank Facility against the assignment of the Bank Guarantee which shall make available to MPS the sum of RM53 million to be arranged and utilized in the manner stated herein described in this JV Agreement.(b)In addition to and without prejudice to the terms and conditions of this JV Agreement, the Company also undertakes to continue to ensure the fulfilment of the Companys responsibilities in so far as providing all the corporate and personal guarantees and the land collateral as agreed between MPS and the Company under the Resettlement Agreement.

5. Obligations of MPS

5.1 Fulfilled Obligations by MPS under the Resettlement Agreement

The parties hereto recognise and accept that MPS has fulfilled all, and has not breached any, of its duties and obligations under the Resettlement Agreement including the creation of a Third Party Charge over the Said Land that has facilitated the release of the bridging finance facilities and issuance of the Bank Guarantee from SDB as arranged by the Company under the terms and condition of the Resettlement Agreement.

5.2 Specific Obligations of MPS

5.2.1 Assignment of the Bank Guarantee

MPS hereby agree to work with the Company and the Developer to make the necessary arrangements to enable MPS to assign the Bank Guarantee as stated in Clause 3.3 hereinabove on terms and conditions acceptable to MPS at MPSs absolute discretion, PROVIDED ALWAYS that the entire management and administration of the funds shall be placed fully and solely under the control of MPS.5.2.2 Transfer of the Said Land

MPS hereby agree to execute deliver and transfer the relevant Memorandum of Transfer in escrow, document of title when released by SDB and relevant documents in respect of the Said Land to transfer the Said Land to any party jointly nominated by the Company and/or the Developer in writing but subject always to all existing and current encumbrances conditions of title and government acquisition on an as-is-where-is basis, to the solicitors of the Company or the Developer for stamping and lodgement of the said transfer (entirely at the cost and expense of the Company and the Developer), upon the completion of ALL of the following by the Company and/or the Developer (also entirely at their own cost and expense):

(a) Upon the completion of the registration of the transfer of the Private Land to MPS;

(b)Upon the issuance of Certificates of Practical Completion and Occupation Certificates for all the buildings facilities and structures of the Resettlement Scheme and all other individual units of buildings promised as MPS Entitlements under Clause 5.3 of this JV Agreement; and

(c) Upon the issuance of the individual subdivided titles in the name of MPS to all the buildings facilities and structures of the Resettlement Scheme and all other buildings as promised under this JV Agreement which are constructed on the Private Land and the payment of all costs fees and premiums for the subdivision and registration of the same;However, MPS hereby consents to, before the complete fulfilment of all of the aforesaid conditions, permit the Company and the Developer to carry out the subdivision of the Said Land in accordance with the Master Development Plan (entirely at the cost and expense of the Company and the Developer) while retaining MPS as the full and absolute registered owner of the Said Land and all such subdivided titles, pending the complete fulfilment of all of the aforesaid conditions; and That after the complete fulfilment of paragraphs (a) and (b) above, MPS may in its absolute subjective discretion consent to the earlier registration of the said transfer of the Said Land prior to the complete fulfilment of paragraph (c) above after the Company and/or the Developer has provided a sufficient amount in cash or bank guarantee as security for the fulfilment of (c) which is deem sufficient, upon proof of the relevant amount provided by the Company and/or the Developer, by MPS in its absolute subjective discretion, which consent is to be indicated in writing signed by both the President and the Secretary of MPS.

5.3MPS Entitlements

MPS shall be entitled to receive, notwithstanding anything to the contrary in this JV Agreement and in particular Clauses 3.3(g) and 3.5 hereinabove, and the Company and the Developer shall entirely at their own cost and expense without any corresponding liability of MPS ensure the delivery to MPS, together with the utilization of the Bank Guarantee of RM53 million but strictly in accordance with Clause 3.3 above, the following entitlements within the time described as follows:

(i)200 units of the affordable apartments in accordance to the design and specifications approved by MPS under the Resettlement Agreement or any other alternative design or specifications as MPS may approve, on the Private Land to be completed with all infrastructure and preliminary works and public utilities and with Certificates of Practical Completion issued within twenty four (24) months from the date of the approval of the relevant development plans by MPS;

(ii)the balance 800 units of the affordable apartments in accordance to the design and specifications described in paragraph (i) above, together with a surau, dewan masyarakat and mosque in accordance to the design and specification acceptable and approved by MPS, on the Private Land to be completed with all infrastructure and preliminary works and public utilities and with Certificates of Practical Completion issued within thirty six (36) months from the date of the approval of the relevant development plans by MPS;

(iii)500 units of houses on stilts on a piece of land to be designated by MPS (hereinafter referred to as the New Land) in accordance to the design and specifications as approved by MPS to be completed with all infrastructure and preliminary works and public utilities and with Certificate of Practical Completion issued within eighteen (18) months from the date of the approval of the relevant development plans by MPS; and

(iv)MPS shall become the full and absolute registered owner to all of the titles of the subdivided lands and buildings for each and every unit of the apartments, buildings, facilities and structures of all items stated at paragraphs (i), (ii) and (iii) above, and to receive all the duly registered issued documents of title to all of the same including all subsidiary titles, without unreasonable delay.

For the avoidance of doubt, the Company and the Developer shall also, entirely at their own cost and expense without any corresponding liability of MPS but subject to the strict terms of Clause 3.3 above:-

(v) carry out and complete all preliminary substantive and finishing work for all infrastructure roads access and connections to public utilities (water and electricity) drainage and sewerage as required and approved by the Local Authority and relevant departments or agencies for all of the above apartments, buildings, facilities and structures, as well as for the Resettlement Scheme, the Private Land and the New Land as a whole;

(vi) any cost or expense required for the completion and delivery of all of the MPS Entitlements in excess of the utilization of the Bank Guarantee of RM53 million in accordance with Clause 3.3 above shall be fully borne by the Company and the Developer; and

(vii) pay for all survey application approval registration fees and expenses, subdivision premium and expenses, stamp duties and all incidental or related costs, fees, expenses, duties and charges of whatsoever kind until paragraph (iv) above is fully achieved.

5.4Support by MPS

5.4.1Co-operationMPS shall assist in procuring all relevant Government agencies to assist and co-operate with the Company and/or the Developer to facilitate the implementation of this Agreement, PROVIDED ALWAYS that the Company and/or the Developer has complied with all the relevant legal requirements in a satisfactory and timely manner.5.4.2Approvals

MPS shall assist in procuring all relevant Government agencies to grant the Company and/or the Developer all the necessary approvals, including those approvals required from the relevant authorities for the appropriate re-zoning of the said Land, to enable the implementation of this JV Agreement, PROVIDED that the Company and/or the Developer has complied with all the relevant legal requirements necessary for those application in a satisfactory and timely manner.

5.4.3Signing and Submission of ApplicationsWhere applicable and if required by statutory or other legal requirements, MPS shall in respect of the Resettlement Scheme sign all such applications, plans, instruments and submissions as may be necessary to enable the Developer to submit such applications, plans, instruments and submissions to the relevant agencies for the requisite approvals with regard to the construction completion and issuance of the Certificate of Practical Completion.

5.4.4MPS Capacity as Local Authority Not Affected

Notwithstanding anything to the contrary in this JV Agreement or the Resettlement Agreement, it is hereby agreed and understood by all parties that the role of MPS as a Local Authority or statutory body and its jurisdiction powers functions and duties in the said capacities is not, by virtue of anything contained in the said Agreements, affected compromised jeopardised or restricted, and that MPS has entered into this JV Agreement and the Resettlement Agreement solely in its capacity as a private commercial party i.e. as the registered owner of the said Land.

Therefore, for the avoidance of doubt, MPS shall not be considered as having breached or committed any fault under any of the said Agreements nor shall MPS be liable in any way to any party for delay loss or damage arising from as a result of or by virtue of any act or omission by MPS acting in its aforesaid capacities as a Local Authority or statutory body.

6 Roles and Responsibilities of the Developer6.1 Agreement to Develop the Said Land

MPS and the Company hereby agree that the Developer, entirely at their own cost and expense and risk and liability without any corresponding liability of MPS, shall continue with all development works which have been commenced including, inter alia, all Construction Works on site that had ceased, and all the necessary actions including the review, amendments, rectification, remedial and other related works as consented and agreed by MPS, in particular to: (a) reconceptualise and redesign the overall Project under the Reconceptualised Master Development Plan as one major consolidated project under the Sabah Development Corridor (hereinafter referred to as the Project) as approved by MPS;(b) restructure the finances of the previous works by the Company for the original Resettlement Scheme and the Integrated Mixed Development, review and restructure the finances or financing of all works previously done by the Company for the original Resettlement Scheme and the Integrated Mixed Development;(c) consolidate the Said Land with all the additional lands adjacent to the Said Land as indicated in Red in Annexure B-3 herein and to develop the entire area as a Consolidated Project under the SDC.6.2 Securing Participation of Investors

The Developer shall at their own initiative and risk secure the placement of investments by institutional and private investors in the Project. It is hereby agreed that any failure delay or difficulty in securing such investment, whether due to the fault of the Developer or not, shall not affect or prejudice any of the right or power of MPS under this Agreement, including to receive its Entitlements under Clause 5.3 of this JV Agreement within the time stated.6.3 Fulfilling the Obligations of the Company

6.3.1 Layout Plan and Design for the Resettlement Scheme

The development construction and completion of the Resettlement Scheme by the Developer shall, unless otherwise agreed by MPS, be in accordance with the Specifications, Layout Plan and Design as agreed under the Resettlement Agreement set out in annexure B of the Resettlement Agreement.6.3.2 Design and Standards of Works

All works relating to the development and construction of the rest of the Entitlements of MPS under Clause 5.3 of this JV Agreement other than the Resettlement Scheme shall be carried out by the Developer in accordance with the Specifications, Layout Plan and Design approved by MPS.6.3.3 Approval of Specifications, Layout Plan and Design

Notwithstanding any Specifications, Layout Plan and Design as may have been set out in the Resettlement Agreement and approved by MPS pursuant to this JV Agreement, the Developer shall at their own cost and expense obtain the necessary prior approvals from all relevant competent authorities including MPS.6.3.4 Undertakings

Notwithstanding the approval of the Specifications, Layout Plan and Design by MPS in both its private and public capacities, the Developer warrants that all Construction Works shall be carried out in accordance with:

(a) the requirements of current Malaysian standards;

(b) all by-laws and Local Authority building regulations; and

(c) good construction and engineering practice.

6.3.5 Variations

The Developer may make or propose any variations to any of the Specifications and/or the Layout Plan and/or Design, prior to approval thereof by the relevant authority, subject to the consent of MPS at the absolute discretion of MPS.6.4 Returns to Company and the Developer

The Company and the Developer have agreed to undertake and carry out the construction and completion of the Resettlement Scheme and the Apartments and/or other development on the Said Land in accordance with this JV Agreement and their respective duties commitments obligations and liabilities and the distribution and apportionment of the profits, benefits and returns inter-se from the sale of the Apartments and other development on the Said Land are set out in a separate agreement between the Company and the Developer.

7 Steering Committee and Appointment of Financial Advisor

7.1Steering Committee

The parties hereto shall establish a joint steering committee to coordinate the implementation and progress of work of the Resettlement Scheme and all of the Entitlements of MPS under Clause 5.3 of this JV Agreement until the full completion and handover of the same. However, it is hereby agreed that the purpose of such committee is strictly for the purpose of coordination and communication only and no act neglect or omission by any representative to such committee shall affect compromise prejudice or undermine any of the right or power of or to bind in any way any party to this JV Agreement. 7.2 Appointment of Financial Advisor

The parties hereto shall appoint the firm Ernst & Young, or any other person or firm mutually agreed in writing, to be the independent financial advisor to the Project and the fee, cost and expenses arising from this appointment or its operation or performance of service shall not be borne by MPS in any way. However, it is hereby agreed that the purpose of such financial advisor is strictly for the purpose of offering advice only and MPS is not bound to accept adhere refer to or take into account any advice or opinion offered by such Financial Advisor.7.3 Mutual Co-operation and Assistance

MPS, the Company and the Developer agree, confirm and declare that they shall each do execute and perform all such further deeds, documents, assurances, acts and things by themselves or shall use their best endeavours to procure that any necessary third party shall do execute and perform all such further deeds, documents, assurances, acts and things as any of the parties hereto may reasonably require by notice in writing to the other parties hereto in order to carry out and fulfil the provisions of this JV Agreement and the respective obligations of each of the parties hereto.

8 Completion Date Extended

MPS hereby agree that the Completion Date of the works to be carried out by the Company under the Resettlement Agreement shall be extended to those as provided under Clause 5.3 above. 9 Construction Works

9.1 Construction for the Resettlement Scheme

Upon the satisfaction of all conditions precedent to the commencement of works under this JV Agreement, the Company and the Developer shall continue to carry out every and all stages of the construction and development of the Resettlement Scheme that the Company had failed to carry out within the period agreed upon under the Resettlement Agreement and to ensure its successful completion, together with all of the Entitlements promised to MPS under Clause 5.3 of this JV Agreement (hereinafter collectively referred to as the Construction Works), within the agreed time. 9.2Construction Cost

The Company and the Developer shall incur no less than Ringgit Malaysia Fifty Three Million (RM53,000,000.00) to complete the Construction Works which shall not include the costs of the Private Land or any preliminary, preparatory or infrastructure works for the Private Land and the New Land for the sites to be ready for the construction of the apartments houses buildings and structures and their infrastructures and public utilities. 9.3Commencement of Construction WorksThe Company and the Developer shall continue or proceed to carry out the Construction Works immediately after the signing of this Agreement.9.4 Quality of Construction

9.4.1The Company and the Developer shall hereby carry out and continue to carry out the Construction Works:

(a) In a proper (and workmanlike) manner and with a high workmanship standard as required by MPS;

(b) In accordance with the approved plans by MPS; and

(c) In accordance with the terms and conditions of this JV Agreement and all applicable laws, regulations and building standards of Malaysia.9.4.2The Company and the Developer shall hereby ensure and continue to ensure that all equipment, plant and material used for the Construction Works are of a suitable grade or quality for their intended use and are otherwise in accordance with the terms and conditions of this JV Agreement, the Specifications, the Layout Plan and Design. 9.5Right of Inspection

The Company and the Developer shall permit and allow the authorised representative of MPS as a party and as approving Authority to enter the relevant work sites and to inspect the progress of the Construction Works at all times and the Developer is obliged to secure the authorized officer of MPS to vet through and endorse each Certificate of the progress of works in respect of the Resettlement Scheme issued by the Developers consultants.

9.6 Custody and Supply of Documents

9.6.1 The Developer shall provide MPS with sufficient copies of all drawings, specifications, details, levels, and setting out dimensions that shall be used for the purpose of the Construction Works.9.6.2 Before the commencement of the defects Liability Period the Developer shall provide MPS with sufficient copies of the as built drawings and information showing or describing the Construction Works.

9.6.3 No party shall divulge or use any of the documents mentioned in this Clause except for the purposes of this JV Agreement or in connection with the maintenance, use, repair, advertisement, letting or sale of the completed buildings or of any confidential information pertaining to and given by the other parties.9.7 Progress Reports

The Developer shall submit to MPS Representative monthly progress reports on the Construction Works.

9.8Handing Over of the Resettlement Scheme

9.8.1The Developer shall procure the Certificates of Completion and hand over the vacant possession of the Construction Works to MPS free of encumbrances and at no cost or expense to MPS by the respective Completion Dates under Clause 5.3.

9.8.2The Defects Liability Period for the Resettlement Scheme shall be one and one half (1 ) years from the date of issue of the relevant Certificates of Practical Completion in respect of each building or portion of the Construction Works.

9.9Control of MPS over the Construction Works

9.9.1 MPS may at any time issue directions and orders to the Company and/or the Developer in the event MPS considers in its subjective opinion any part of the Construction Works to be unsatisfactory or not in compliance with this JV Agreement, including to rectify demolish or rebuild the same or to suspend part the work pending investigation testing or inquiry.

9.9.2MPS shall not be liable to the Company or the Developer for any delay loss or damage or additional cost or expense caused as a result of MPS exercising the power or right granted under this Clause and the relevant completion date(s) of the Construction Works shall not be affected or prejudiced PROVIDED THAT MPS has reasonable or justifiable ground in exercising such power or right at the time of exercising it notwithstanding that the ground is found to be lacking ex post facto.

10.DEFECTS LIABILITY

10.1Defects Liability Guarantee

It shall be the obligation of the Company and the Developer to furnish to MPS a bank guarantee for a sum equivalent to five percent of the total cost of the Construction Works as Defects Liability Guarantee on the date of issue of the respective Certificate of Practical Completion for each portion of the Construction Works which shall be kept valid for a period of at least eighteen (18) months from such respective dates. The bank guarantee shall be utilized by MPS for rectification or making good of any defect found within such period of time provided always that the Company and the Developer shall continue to be liable for any defect discovered after the expiry of such period and in the event that the money required to rectify or make good any such defect exceed the sum guaranteed.

10.2Making Good the Defects

Upon notice in writing from MPS, the Company and the Developer shall within one (1) week from the receipt of the notice at its own cost and expense make good and remedy all defects cracks or shrinkage which become apparent within eighteen (18) months from the respective date of the relevant Certificate of Practical Completion for each portion of the Construction Works.

10.3Failure to Make Good

In the event that the Company and/or the Developer fails to comply with the preceding provision within the time specified, the materials or works so affected may be made good in such a manner deemed fit and proper by MPS and such costs of rectification or making good shall be deducted from the Defects Liability Guarantee provided always that the Company and the Developer shall continue to be liable for any defect discovered after the expiry of such period and in the event that the money required to rectify or make good any such defect exceed the sum guaranteed.

10.4Balance of Defects Liability Guarantee to be Returned

The Defects Liability Guarantee (or any balance remaining to the credit of the Developer) may only be released or refunded to the Developer upon the completion of rectification or making good of all defects cracks shrinkages or other faults or damage which appear during the Defects Liability Period.

11. ALL LANDS FEES, COSTS, EXPENSE AND PREMIUMS

It is hereby agreed between the parties hereto that the Developer and the Company shall be solely liable and responsible for all, and MPS shall not be liable or responsible for any, of the fees costs and expense with respect to all the lands involved in this JV Agreement including the payment of conversion, survey fees, application, approval, premiums and penalties assessed charged or imposed by all competent authorities such as the Town Planning Board and the Lands and Surveys Department for the conversion and the issuance of the documents of title to all the lands and the premiums for the subdivided and subsidiary titles to all of the individual lands buildings or structures under this JV Agreement, and such premiums shall include all charges for the conversion amalgamation subdivision or consolidation of the said Land and shall cover all lands including those to be transferred into the name of MPS. However, it is agreed that the Developer and the Company shall not be responsible or liable for all the payments to the Lands and Surveys Department necessary for and up to the registration of the New Land into the name of MPS and to the Town Planning Board for the relevant zoning of the New Land. 12.INSURANCE AGAINST INJURY TO PERSON AND DAMAGE TO PROPERTY

12.1Insurance During Construction Period

Without prejudice to the Companys liability and obligation to indemnify MPS in accordance with Clause 13 of the Resettlement Agreement which the Developer hereby also undertakes, the Company and the Developer shall as a condition precedent to the commencement of any work under this JV Agreement effect and maintain at their own cost and expense such insurance policies deemed as necessary or suitable by MPS to cover a minimum sum of RM53million to cover the liability of the Company and the Developer and all sub-contractors, in respect of personal injury or death arising out of or in the course of or by reason of the execution of the Construction Works and in respect of injury or damages to property, real or personal, arising out of or in the execution of the Construction Works and caused by any negligence, omission, breach of contract or default of the Company or the Developer, their servants or agents or, as the case may be, of any such sub-contractor, its servants, or agents. Where an excess amount is specified, the Company and the Developer shall bear the amount of such excess. The policy or policies of insurance shall contain a cross liability clause indemnifying each of the jointly insured against claims on it by the other jointly insured. Such insurance policy or policies shall provide expressly for payment in the first place to MPS of any insurance monies due under the policy or policies.

12.2Maintenance of Insurance

Without prejudice to the Companys liability and obligation to indemnify MPS in accordance with Clause 13 of the Resettlement Agreement which the Developer hereby also undertakes, the Company and the Developer shall as a condition precedent to the commencement of any work under this JV Agreement effect and maintain at their own cost and expense insurance policies during the execution of the Construction Works as well as during the Defects Liability Period for such amount of indemnity deemed as necessary or suitable by MPS to cover a minimum sum of RM53million in respect of any damage, expense, liability, loss, claim or proceedings which MPS may incur or sustain or face by reason of damage to any property (including the Construction Works and any other property of MPS) caused by any act or omission of the Company and/or the Developer or any of their sub-contractor agent or servant arising out of or in the course of or by reason of the carrying out of the Construction Works except damage arising from any of the excepted risks as specified in the Resettlement Agreement.

12.3Approved Insurance Company

Such insurances as referred to under this Clause 12 shall be effected with an insurance company deemed acceptable and suitable by MPS and maintained in the joint names of MPS and the Company/the Developer for the whole construction period and in such manner that the interests of MPS are fully protected during the progress of the Construction Works as well as the Defect Liability Periods. Where an excess clause is specified, the Developer shall bear the amount of such excess. It shall be the duty of the Company and the Developer to produce the relevant policy or policies of insurance together with receipts in respect of premiums paid to MPS immediately upon receipt of the same whether demanded by MPS or not.

12.4Independent and Concurrent Remedies

The provision of such insurance is as a separate and independent remedy or security for MPS and MPS shall not be obliged to first make any claim on such insurance before invoking any other remedy under this JV Agreement or the law and MPS shall be entitled to resort to all remedies concurrently provided that MPS shall give credit to the Company or the Developer for any double recovery or overlapping claim.

13.WORKMENS COMPENSATION AND SOCSO SCHEME

13.1Indemnity Against Claims By Workmen

The Company and the Developer shall be liable for and shall indemnify and shall keep indemnified MPS and its officers or servants from all liabilities and responsibilities arising out of any claim by any labourer or workman employed in the Construction Works and for the performance of this Agreement for payment of compensation under or by virtue of the Workmens Compensation Act 1952 and the Employees social Security Act 1969 and the applicable labour law or any other law for the time being in force with respect to such labourers or workmen and from all cost and expense incidental and consequential thereto.

13.2Policy Insurance

13.2.1Without prejudice to the Companys liability and obligation to indemnify MPS in accordance with Clause 13 of the Resettlement Agreement which the Developer hereby also undertakes, the Company and the Developer shall as a condition precedent to the commencement of any work under this JV Agreement effect and maintain at their own cost and expense in the joint names of MPS and the Company/Developer (and of the Companys/Developers own sub-contractors, if any) a policy or policies of insurance from an insurance company approved by MPS as are necessary to cover the liability of the Company/Developer in respect of the labourers and workmen employed by it and its sub-contractors. Such insurance policy or policies shall provide expressly for payment in the first place to MPS of any insurance monies due under the policy or policies.

13.2.2The said policy or policies so taken out shall be deposited with MPS and the Company and the Developer shall maintain it or them in full force and effect by prompt and up to date payment of all premium for the whole duration of the Construction Works and the Defect Liability Periods. Where an excess clause is specified, the Developer shall bear the amount of such excess. It shall be the duty of the Company and the Developer to produce the relevant policy or policies of insurance together with receipts in respect of premiums paid to MPS immediately upon receipt of the same whether demanded by MPS or not. 13.3Registration with SOCSO Scheme and Contribution

13.3.1The Company and the Developer shall from time to time until the end of the Defects Liability Period comply with and make payment of all contributions under the Employees Social Security Act, 1969 if applicable. In such a case the Company and the Developer shall register their employees and contribute under Social Security (SOCSO) Scheme and it shall be the duty of the Company and the Developer to produce contribution cards or stamp vouchers as evidence of payment of such contribution to MPS immediately upon receipt of the same whether demanded by MPS or not.

13.3.2Nothing in this clause shall be construed as to take away or to waiver or in any manner to modify the right of MPS to be indemnified by the Company and the Developer in respect of all compensation, costs and other expenses whatsoever whether covered by such insurance or scheme or not and MPS shall not be obliged to first make any claim on such insurance or scheme before invoking any other remedy under this JV Agreement or the law and MPS shall be entitled to resort to all remedies concurrently provided that MPS shall give credit to the Company or the Developer for any double recovery or overlapping claim.14.INSURANCE OF CONSTRUCTION WORKS

14.1The Company and the Developer shall in the joint names of MPS and the Company/Developer insure against loss or damage by fire, lighting, explosion, storm, tempest, flood, earthquakes, tsunami, bursting or overflowing of water tanks, apparatus or pipes, aircraft and other aerial devices or articles dropped therefrom, riot and civil commotion, whether due to the fault of the Company and/or the Developer or not, to cover all work executed and all unfixed materials and goods delivered to, placed on or adjacent to the Construction Works and intended thereof (but excluding temporary buildings, plants, tools and equipment owned or hired by the Company or the Developer or any sub-contractor) to the full value thereof at the minimum sum of RM53 million together with the cost of the design work of the Company and the Developer and shall keep such work, materials and goods so insured until the practical completion and handing over of vacant possession of the whole of the Constructions Works but subject to any partial termination of insurance permitted under this Agreement in cases of sectional completion or partial handing over of vacant possession to MPS at the sole discretion of MPS. Such insurance policy or policies shall provide expressly for payment in the first place to MPS of any insurance monies due under the policy or policies.

14.2Approved Insurance Company

Such insurances as referred to under this Clause 14 shall be effected with an insurance company deemed acceptable and suitable by MPS and maintained in the joint names of MPS and the Company/the Developer for the whole construction period and in such manner that the interests of MPS are fully protected during the progress of the Construction Works as well as the Defect Liability Periods. Where an excess clause is specified, the Developer shall bear the amount of such excess. It shall be the duty of the Company and the Developer to produce the relevant policy or policies of insurance together with receipts in respect of premiums paid to MPS immediately upon receipt of the same whether demanded by MPS or not.

14.3Obligation of the Developer in the event of loss or damage

Upon the occurrence of any loss or damage, whether due to the fault of the Company and/or the Developer or not, to any part of the Construction Works or unfixed materials or goods prior to the completion of the Construction Works, the Company and the Developer shall notwithstanding that settlement of any insurance claim has not been completed despite their due diligence, restore, replace or repair the same, remove and dispose of any debris and proceed with the carrying out and completion of the Construction Works.

14.4Independent and Concurrent Remedies

The provision of such insurance is as a separate and independent remedy or security for MPS and MPS shall not be obliged to first make any claim on such insurance before invoking any other remedy under this JV Agreement or the law and MPS shall be entitled to resort to all remedies concurrently provided that MPS shall give credit to the Company or the Developer for any double recovery or overlapping claim.

14.5Care of Construction Works before Vacant Possession

Notwithstanding and in addition to any insurance policy taken out by the Company and the Developer to insure all the Construction Works against loss or damage, it is hereby agreed that before the Occupation Certificate and the vacant possession of any particular part of the Construction Works is handed over to MPS, as the party carrying out such work, the Company and the Developer shall bear all the risks of loss or damage due to any cause whatsoever including natural disasters or intentional act of any person or company whether with or without fault of the Company or the Developer. 15.PUBLIC UTILITIES FOR USE DURING CONSTRUCTION

15.1 Supply and Application

15.1.1In relation to the supply of Public Utilities and services required by the Company and the Developer during the progress of the Construction Works, all applications in respect thereof to the relevant Public Utilities authorities or companies charged with the responsibility for the same shall be made by the Company/or and the Developer and all cost and expense incurred thereby shall be borne and paid for by the Company and/or the Developer.

15.1.2MPS shall render every assistance as may be necessary to support the Company and the Developer in relation to any such applications to the relevant Public Utilities authorities or companies provided that the Company and/or the Developer have complied with all statutory and other legal requirements necessary for such applications.15.2 Access for Maintenance

The Company and the Developer shall at all times permit the authorized personnel of all Public Utilities authorities or companies to have access to the said Land for the purpose of routine maintenance or urgent repairs to their respective services. The Company and the Developer may impose such reasonable conditions or requirements as are necessary to protect the interests of the Company and the Developer.

16.INDEMNITY TO MPS IN RESPECT OF INJURY TO PERSONS AND DAMAGE TO PROPERTY

16.1Indemnity

16.1.1The Company and the Developer shall be liable for and shall indemnify MPS against any damage, expense, liability, loss, claim or proceedings whatsoever whether arising under any applicable law or regulation in respect of personal injury to or death of any person howsoever arising out of or in relation to or in the course of or by reason of the execution of the Construction Works.

16.1.2The Company and the Developer shall be liable for and shall indemnify MPS against any damage, expense, liability, loss claim or proceedings due to injury or damage of any kind to any property real or personal (including the Construction Works and any other property of MPS) insofar as such injury or damage is arising out of or in relation to or in the course of or by reason of the execution of the Construction Works and Provided Always that the same is due to any negligence, omission, breach of contract or default or failure to comply with any applicable law or regulation by any person to whom the Company or the Developer is responsible for including the Companys or the Developers servants or agents or of any sub-contractor, his servants or agents.

16.1.3The indemnity hereby given shall not be defeated prejudiced or reduced by reason of any negligence or omission of MPS or its Representative.

17. LAND RIGHTS

17.1 Development of the Said Land

In consideration of the mutual covenants herein and subject to the terms and conditions set out herein, MPS hereby agrees to allow the Developer to develop the Said Land and to carry out, subject to Clause 5.3, the implementation and the construction of the buildings, facilities and utilities as outlined in the reconceptualised Master Development Plan in Annexure B-1 herein or as may otherwise be mutually agreed upon and approved by MPS from time to time.

17.2Taxes

The Company and the Developer shall pay all their taxes including income and corporate taxes, charges and other dues payable by the Company in accordance with laws of Malaysia arising from this JV Agreement.

17.3Incidental Costs

All costs incidental to the preparation of this Agreement including stamp duty of this Agreement and the solicitors fees incurred by MPS shall be borne and paid by the Developer and/or the Company.18.FORCE MAJEURE

In the event that this JV Agreement or any material part thereof shall have become incapable of performance as a result of war, natural disaster, riot and civil commotion, fire, acts of God or any other causes beyond the reasonable control of the party whose performance of its obligations hereunder are affected by such causes, then if such incapacity continues for a period exceeding thirty (30) days but not exceeding ninety (90) days, the performance by the other party of its further obligations under this Agreement shall be deemed suspended throughout the continuance of the incapacity which does not exceed a period of ninety (90) days but in the event the incapacity of performance exceeds ninety (90) days, then the other party shall be deemed relieved from performing its respective further obligations under this agreement but without prejudice howsoever to the rights, titles and obligations arising prior to the commencement of the force majeure concerned and in such event, the parties shall mutually agree on the measures to be taken to resolve the difficulties faced by the parties.

19.DEFAULT BY DEVELOPER

19.1Events of Default

Without prejudice to and in addition to and concurrent with any other rights or remedies which MPS may possess under any other provision of this JV Agreement and under the law, if the Company and/or the Developer shall make default in any one or more of the following respects, that is to say:

19.1.1If it without reasonable cause suspends the carrying out of the whole or any part of the Construction Works before completion; or

19.1.2If it fails to proceed regularly and diligently with any part of the Construction Works; or

19.1.3If it fails to execute any part of the Construction Works in accordance with the Specification, Layout Plan and Design or neglects to carry out its obligations thereunder; or

19.1.4If it refuses or neglects to comply with a written notice from MPS to remove and replace any defective work or improper materials or goods; or

19.1.5If it fails to provide or maintain the effectiveness and validity of any the bank guarantees or insurance policy as required by and in the format in accordance with the terms and conditions of this JV Agreement; or

19.1.6enters into composition or any arrangement with its creditors without the prior written consent of MPS; or

19.1.7commits any breach of this Agreement which affect MPSs interests; or

19.1.8fails to perform to fulfil any of its obligations under this Agreement;

then MPS may give to the Company or the Developer a written notice specifying the default, and if the Company or the Developer shall either continue such default for thirty (30) days after receipt of such notice or shall at any time thereafter repeat such default (whether previously repeated or not), then MPS may by a written notice forthwith determine this JV Agreement and the appointment of the Company and/or the Developer under this Agreement.

19.2Insolvency of the Company and/or the Developer

If the Company and/or the Developer:-

19.2.1Becomes insolvent or compounds with or makes arrangement with its creditors; or

19.2.2Is having a winding-up order made against it; or

19.2.3Is having a provisional liquidator, receiver or manager of its business or undertaking duly appointed, or possession taken by or on behalf of creditors or debenture holders secured by a floating charge of any property comprised in or subject of the floating charge, then in any such event, without prejudice to any other rights it may possess, MPS may by a written notice terminate this Agreement.

19.3Upon the Agreement being determined either under the sub-clause 19.1 or 19.2 hereof:(a) the powers and rights granted by MPS to the Company and/or the Developer and the obligations of MPS in this JV Agreement shall terminate immediately.(b) The Company and/or the Developer shall:

(i) forthwith cease all the works;

(ii) submit to MPS the detailed reports of the cost for the works and other payments which have become due and owing from MPS prior to the termination for verification and approval by MPS;

(iii) at its own cost and expense, vacate and remove from all sites all of its equipment, machineries and materials not required by MPS or its contractors, sub-contractors, workmen, employees, agents or servants and to handover the sites to MPS within thirty (30) days of the date of the termination notice and make good all damage caused by such removal or detachment. If within that time the Company and/or the Developer fails to comply therewith, MPS may (but without being responsible for any loss or damage) remove and sell such property. The proceeds of sale shall be used to cover any cost incurred for the purpose of sale. Any such balance shall be used to make good any amount owed to MPS.

(iv) terminate all third party contracts entered into by the Company and/or the Developer in respect of carrying out the Constructions Works;(v) automatic reversion of all encumbrances to any property of MPS and whatever necessary costs involved shall be borne by the Company and/or the Developer with no claims whatsoever to MPS;(vi) submit and provide all information statements and the relevant physical and financial reports including audited Project accounts and bank accounts with respect to the banking facilities granted pursuant to the Charge of the said Land to MPS.

(vii) allow MPS or its appointed agents to use all approved plans, specifications and drawings in respect of the Construction Works without any fees or charges.

(c) MPS shall:(i) be entitled to forfeit the bank guarantees provided under this JV Agreement;

(ii) be entitled to claim against the Company and/or the Developer for any loss and damage suffered as a result of their breach or default less the value of works done and materials and equipment left on site at the date of termination to be valued by a licensed surveyor appointed by MPS up to the limit of RM53,000,000.00;

(iii) be entitled to take over the Construction Works and to appoint other contractors to carry out the Construction Works and the Company and/or the Developer shall pay to MPS all costs and expenses incurred by MPS in completing all the Construction Works. The contractors of MPS may use all temporary buildings, plants, tools, equipments, goods and materials intended for, delivered to and placed on or adjacent to the work sites and may purchase all materials and goods necessary for the carrying out and completion of the Construction Works.

PROVIDED THAT the termination shall not affect or prejudice the rights and liabilities of any party which have accrued prior to the date of termination of this JV Agreement and the obligations under this JV Agreement shall continue even after the termination of this JV Agreement in respect of any act, deed, matter or thing occurring prior to such termination of this JV Agreement.

20.DEFAULT OF MPS

20.1If MPS without reasonable cause fails to perform or fulfil any of its express obligations under this JV Agreement, the Developer may give to MPS a notice in writing specifying the default, and if MPS shall either continue such default for thirty (30) days after receipt of such notice or shall at any time thereafter repeat such default, the Developer may within fourteen (14) days after such continuance or repetition issue a notice in writing to terminate this JV Agreement.

20.2Upon such termination, MPS shall reimburse the Developer the actual loss and damage caused by the breach or failure of MPS forming the basis of the termination and in any event shall not exceed the costs and expenses actually expended on the Construction Works already carried out under this JV Agreement subject to the valuation of a licensed surveyor appointed by MPS.21.DISPUTE RESOLUTION

21.1Arbitration

All disputes differences and questions which may arise at any time hereafter between MPS and the Company and/or the Developer regarding the true construction and interpretation of this JV Agreement of as to the rights and liabilities of the parties shall be referred to the decision of a single Arbitrator in Malaysia to be agreed upon between the parties or failing such agreement to be nominated on the application of either party to the High Court of Sabah and Sarawak at Sandakan and such arbitration shall be in accordance with the Malaysian Arbitration Act for the time being in force. The arbitration proceedings shall be held in Sandakan and shall be conducted in the English language. The decision of the Arbitrator shall be final and binding on the parties.

21.2Obligation To Continue

Pending the determination of any dispute under this clause, the obligations of the Company and/or the Developer to carry out the Construction Works in accordance with this JV Agreement and the obligations of MPS shall continue to be in full force and effect.

22.NOTICESAny notices, approval, consent, request or other communication required or permitted to be given or made under this JV Agreement shall be in writing in Bahasa Malaysia or the English language and delivered to the address or sent to the facsimile number of each party as shown below or to such other address or facsimile number as a party may have notified the sender and shall be deemed to be duly given or made (in the case of delivery in person or by facsimile transmission) when delivered to the recipient at such address or facsimile number and if any notice is posted by courier service or registered post to the addresses stated below the notice shall be deemed to be received by the other party within three (3) days after such posting Provided Always that a notice to any one of the Company and/or the Developer shall be deemed to be good and sufficient notice to both.

MPS

Majlis Perbandaran Sandakan

P.O Box No. 221, 90702 Sandakan

Attention:The President

Facsimile:089 272112

The Company

Integral Acres Sdn Bhd (Co. No. 672818-M)

Lot 21, 22 & 23, 1st Floor, Block B, Bandar Tyng, Mile 6 Jalan Utara

90000 Sandakan

Attention:Dato Azlan bin Datuk Nasir


The Developer

Pembangunan Samudera (Sabah) Sdn Bhd (Co. No. 807265-T)

Unit 7, 10th Floor, Wisma Perindustrian, Jalan Istiadat, Likas, 88400, Kota Kinabalu, Sabah, Malaysia

Attention:Kamarul Bahrin Osman


23.WAIVER23.1 Knowledge or acquiescence by any party hereto of any breach of any of the terms, conditions or covenants herein contained shall not operate as or be a waiver of such term, conditions or covenants or any of them and notwithstanding such knowledge or acquiescence, and each party hereto shall be entitled to exercise its respective rights under this Agreement and to require strict performance by the other of the terms, conditions and covenants herein in subsequent occasions. No single or partial non-exercise of any right power or privilege by any party hereto shall preclude any other or further exercise thereof or the exercise of any other power or privilege.

23.2 Notwithstanding anything to the contrary in this agreement, it is hereby agreed by all parties that no act neglect or omission of MPS shall be deem as a confirmation or indication that any of the relevant performance duties or obligations of the Company and/or the Developer towards MPS under this JV Agreement has been fully completed or fulfilled, nor does it constitute a waiver of the same nor acquiescence in any breach or non-performance of the same, unless expressly precisely and conclusively stated as such in writing by the President of MPS. 24.FURTHER ASSURANCES

The parties hereto shall at all times and from time to time do all such further acts and execute all such further deeds, documents and instruments as may be necessary or desirable in order to give full effect to and carry out the terms of this JV Agreement.

25. ILLEGALITY AND UNCERTAINTY

Notwithstanding that any term, condition, stipulation, provision or undertaking or part thereof in this JV Agreement may prove to be illegal, uncertain, void, invalid or unenforceable, the remaining terms, conditions, stipulation, provisions and undertaking or part thereof in this JV Agreement shall continue in full force and effect unless such affected terms, condition, stipulations, provision or undertaking nullify the underlying and fundamental intent of this JV Agreement.26.LANGUAGE

All notices or other communications under or in connection with this Agreement may be in Bahasa Malaysia or English. If any such notice or other communication is translated into or from Bahasa Malaysia or English (as the case may be) the English text shall prevail in the event of any conflict.

27.ENTIRE AGREEMENT

This JV Agreement constitutes the entire agreement between the parties hereto with respect to the matters dealt with herein. Each of the parties hereby acknowledges that in entering into this JV Agreement, it has not relied on any representation or warranty save as expressly set out herein or in any document expressly referred to herein.28.RELATIONSHIP OF THE PARTIES

28.1 Nothing in this JV Agreement shall constitute or be deemed to constitute or be deemed to constitute a partnership between any of the parties hereto and none of them shall have any authority to bind the others in any way nor shall this JV Agreement be construed to constitute any party the agent of the other parties hereto.

28.2 Any performance promise undertaking duty obligation or liability by the Company and/or the Developer or the Company or the Developer or the Company and the Developer towards MPS in this JV Agreement are deemed to be by both the Company and the Developer jointly and severally.

29. OVERRIDING CLAUSES

Notwithstanding anything to the contrary in this Agreement and by way of clarification, amplification and emphasis to avoid any doubt or dispute in interpretation, parties hereby agree that:-

(A) MPS shall under no circumstances:

(i) be required to bear and pay any costs, claims, contributions, fees, top-ups or any outgoings for any necessary additional or variation of work relating to or connected with the construction, completion and delivery of possession of MPSs Entitlement herein and/or under the Resettlement Agreement.(ii) be required to pay any stamp duties, registration fees for all and any transfer of land in this Joint Venture Agreement or the Resettlement Agreement either to or by MPS.(iii) be required to pay any conversion fee, subdivision fee, premium, penalty to any relevant Authorities.(B) The Company and the Developer hereby expressly agree undertake and covenant with MPS to bear and pay all the payments enumerated hereinabove in (A)(i)(ii)(iii) and further agree and covenant with MPS to indemnify MPS and keep MPS indemnified from and against any of the payments aforesaid.(C) That generally, MPS shall get, receive and obtain all MPSs Entitlement under this JV Agreement and/or the Resettlement Agreement and nothing less and any breach of this subclause or any other clauses by the Company and/or the Developer shall give rise to causes of action or claims of damages by MPS against the Company and/or the Developer.(D) It is expressly acknowledged, recognised and agreed by the parties hereto as follows:-(a) That MPS has two distinct capacities in this Joint Venture Agreement, namely:-(i) As the land owner of the Said Land, or any substituted land that may be transferred to MPS under the terms and conditions of this Joint Venture Agreement; and(ii) MPS as the Local Authorities carrying out and exercising their functions, power and jurisdiction in and over the Sandakan Municipal Council area under the Laws pertaining thereto; and(b) That notwithstanding (a)(i) above, all development and implementation of the Project and construction within the Said Land, the Private Land, the Consideration Land as reconceptualised and consolidated in the Master Development Plan shall require and have the approval of MPS exercising their jurisdiction as the Local Authorities under the Laws pertaining and relevant thereto.30.SUCCESSORS BOUND

This Agreement shall be binding upon each of the parties hereto and their respective successors in title and permitted assigns.

31.ASSIGNMENT

The Developer and/or the Company shall not without the written consent of MPS assign any or all of its rights, titles, interests and obligations under this JV Agreement to any person or company.32.APPROVAL BY THE MINISTER OF LOCAL GOVERNMENT AND HOUSING

MPS, the Company and the Developer agree and accept that it shall be a condition precedent that this JV Agreement are subject to the consent of the Minister of Local Government and Housing (hereinafter referred to as the Minister) and the parties hereto shall work closely together to obtain all the necessary approvals, consent, license and permits from the Minister and other relevant authorities in connection with this JV Agreement within a period of ninety (90) days from the date hereof or such other date as may be mutually agreed in writing by the parties hereto.

33.COMPLIANCE WITH LAWS

The Developer and Company shall comply with the provisions of any written law with which it may be required to comply including any Federal Act, State Enactment or Ordinance, or any by laws, Rules, Regulations or other subsidiary legislation under any such Act, Enactment or Ordinance, or any direction, order, requirement or instruction whatsoever given by any authority competent to do so under any written law including MPS in its capacities as a Local Authority.34.GOVERNING LAW

This Agreement shall be governed by and construed in accordance with all the laws applicable to Sabah.35.TIME

Time whenever mentioned in this Agreement shall be of the essence.36.CONFIDENTIAL INFORMATION

The existence of this JV Agreement and its terms, including the Annexures attached herewith are confidential and none of the parties hereto may disclose anything about this JV Agreement or its subject matter or implementation to any person whether before or after the termination of this JV Agreement except:

(a)if required by law to do so; or

(b) in the form and terms previously agreed in writing with the other

parties hereto; or

(c)

in confidence to his professional advisers.

(the rest of this page is intentionally left blank)

IN WITNESS WHEREOF the parties hereto have executed this Agreement the day and year first above state.

THE COMMON SEAL of

)

MAJLIS PERBANDARAN SANDAKAN )

was hereuntoaffixed in the presence of:

)

.................................................

.................................................

Datuk Ir. JAMES WONG

Secretary

President



THE COMMON SEAL of INTEGRAL)

ACRES SDN BHD (Co. No. 672818-M))

was hereunto affixed in the presence of:

)

.................................................

.................................................

DIRECTOR/SECRETARY

DIRECTOR

THE COMMON SEAL of

)

PEMBANGUNAN SAMUDERA

)

(SABAH) SDN BHD (Co. No. 807265-T))was hereunto affixed in the presence of:

)

.................................................

.................................................

DIRECTOR/SECRETARY

DIRECTORPage 2 of 55

Final Jv Agreement Dated 14.07.2011 (Mps,Integral Acres & Pembangunan Samudera)

Documents

Transcript of Final Jv Agreement Dated 14.07.2011 (Mps,Integral Acres & Pembangunan Samudera)