TEXCHEM RESOURCES BHD. (Company No. 16318-K) … · TEXCHEM RESOURCES BHD. (16318-K) MINUTES OF THE...

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JO/DD C:\Users\joyce.ooi\Desktop\TRB Minutes of 44th AGM.doc

TEXCHEM RESOURCES BHD.

(Company No. 16318-K)

(Incorporated in Malaysia)

Registered Office: Level 18, Menara Boustead Penang

39, Jalan Sultan Ahmad Shah, 10050 Penang

Minutes of the Forty-Fourth Annual General Meeting (“44th AGM”) of the Company

held at Pinang Ballroom, Level 3, Jen Hotel, Magazine Road, 10300 Penang on Tuesday,

24 April 2018 at 11.08 a.m.

PRESENT : Board of Directors

Tan Sri Dato’ Seri (Dr.) Fumihiko Konishi

Dato’ Brian Tan Guan Hooi

Mr Yap Kee Keong

Mr Wong Kin Chai

Dato’ Seri Nazir Ariff Bin Mushir Ariff

Dato’ Danny Goon Siew Cheang

Cik Zarizana @ Izana Binti Abdul Aziz

Shareholders, Corporate Representatives and Proxies

As per Attendance List

(The attendees represented a total of 65,029,570 ordinary shares)

BY INVITATION : As per Attendance List

IN ATTENDANCE : Tan Peng Lam

Lee Puay Img Company Secretaries

CHAIRMAN : The Chairman, Tan Sri Dato’ Seri (Dr.) Fumihiko Konishi,

presided at the Meeting.

CHAIRMAN’S ADDRESS

The Chairman extended a warm welcome to all present at the 44th AGM and introduced

the members of the Board, the Group Chief Financial Officer cum Company Secretary,

the Company Secretary, the President and Chief Executive Officer of Polymer

Engineering Division and the representatives from Messrs KPMG PLT, the Company’s

Auditors, the representative from Agriteum Share Registration Services Sdn. Bhd., the

Company’s Share Registrar, the representative from Value Creator Consultancy, the

appointed Scrutineer and the corporate representative from Minority Shareholder

Watchdog Group.

With the requisite quorum being present, the Chairman declared the 44th AGM duly

constituted at 11.08 a.m. The Chairman noted that as 28 days’ notice has been given to

the shareholders, the notice convening the 44th AGM was taken as read.

TEXCHEM RESOURCES BHD. (16318-K)

MINUTES OF THE FORTY-FOURTH ANNUAL GENERAL MEETING

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C:\Users\joyce.ooi\Desktop\TRB Minutes of 44th AGM.doc

VIDEO PRESENTATION BY PRESIDENT AND GROUP CHIEF EXECUTIVE

OFFICER

The Chairman invited the President and Group Chief Executive Officer, Mr Yap Kee

Keong, to present the corporate video presentation on Texchem Resources Bhd Group of

Companies to the shareholders.

POLL VOTING

The Chairman informed the Meeting that in compliance with the requirement of Bursa

Malaysia Securities Bhd.’s Main Market Listing Requirements for poll voting, all

resolutions which would be put to vote at the 44th AGM would be conducted by way of

electronic poll voting and the Company had appointed Agriteum Share Registration

Services Sdn. Bhd. as the Poll Administrator to conduct the electronic polling process

and Value Creator Consultancy, the Scrutineer, to verify the poll results.

The Chairman then invited the Poll Administrator to read out the rules and procedures for

polling and a trial run for the electronic voting was conducted. The Chairman announced

that polling process would be conducted immediately after each resolution to be

transacted at the 44th AGM is proposed and seconded by a shareholder.

The results of the poll (a copy of which is annexed hereto as Appendix 1) were

announced by the Chairman upon completion of the verification of the votes by the

Scrutineer and details of the resolutions were set out herein.

1. AUDITED FINANCIAL STATEMENTS

The Audited Financial Statements for the financial year ended 31 December 2017

together with the Reports of the Directors and Auditors thereon were received and

duly noted at the 44th AGM.

The Chairman informed the Meeting that on 23 April 2018, the Company had

received a letter from the Minority Shareholder Watchdog Group (“MSWG”)

raising some questions to the Company. The Group Chief Financial Officer cum

Company Secretary, Mr Tan Peng Lam, was invited to present the questions and

answers accordingly for the benefit of the members present and this was presented

via a slide show. A copy of the Company’s letter of reply to MSWG is attached

herewith as Appendix 2.

The Chairman invited questions and/or comments from the floor on the Audited

Financial Statements for the financial year ended 31 December 2017. Questions

raised by the shareholders present were answered by the Board of Directors. The

pertinent questions raised and answers given are set out in Appendix 3 attached

herewith.



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2. RE-ELECTION OF DIRECTORS

(i) RESOLVED THAT Dato’ Seri Nazir Ariff Bin Mushir Ariff, who retired

in accordance with Article 123 of the Company’s Articles of Association,

be re-elected as a Director of the Company.

Proposer : Toh Hock Chooi

Seconder : Dato’ Khoo Yeoh Gan Hong

(ii) RESOLVED THAT Cik Zarizana @ Izana Bint Abdul Aziz, who retired

in accordance with Article 123 of the Company’s Articles of Association,

be re-elected as a Director of the Company.

Proposer : Joyce Ooi Siew Lan

Seconder : Ong Guan Hong

3. DIRECTORS’ FEES

RESOLVED THAT the Directors’ fees of RM1,040,000 for the financial year

ended 31 December 2017 be approved for payment.

Proposer : Ch’ng Sing May

Seconder : Toh Hock Chooi

4. PAYMENT OF DIRECTORS’ BENEFITS

RESOLVED THAT the Directors’ benefits of RM30,000 to the three (3)

members of the Audit Committee for the financial year ended 31 December 2017

be approved for payment.

Proposer : Lau Eng Hwa


5. RE-APPOINTMENT OF AUDITORS

RESOLVED THAT Messrs KPMG PLT be re-appointed as the Auditors of the

Company for the financial year ending 31 December 2018 and to hold office until

the conclusion of the next Annual General Meeting and the Directors be and are

hereby authorised to determine and fix the remuneration of the Auditors.

Proposer : Deavagi Devi Karuppaiah




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6. SPECIAL BUSINESS – ORDINARY RESOLUTIONS

IT IS HEREBY RESOLVED AS FOLLOWS:

(A) Continuing in office as Independent Non-Executive Directors

(i) THAT authority be and is hereby given to Dato’ Seri Nazir Ariff

Bin Mushir Ariff who has served as an Independent Non-

Executive Director of the Company for a cumulative term of more

than nine (9) years to continue to act as an Independent Non-

Executive Director of the Company.

Proposer : Dato’ Khoo Yeoh Gan Hong

Seconder : Tan Chye Luan

(ii) THAT authority be and is hereby given to Dato’ Danny Goon Siew

Cheang who has served as an Independent Non-Executive Director

of the Company for a cumulative term of more than nine (9) years

to continue to act as an Independent Non-Executive Director of the

Company.

Proposer : Tan Chye Luan

Seconder : Loo Swee See

(B) Power to Issue Shares pursuant to Section 75 and Section 76 of the

Companies Act 2016

THAT subject always to the Companies Act 2016 (“Act”), Articles of

Association of the Company and approvals of the relevant regulatory

authorities, where such approval is necessary, the Directors be and are

hereby empowered, pursuant to Section 75 and Section 76 of the Act, to

allot and issue shares in the Company from time to time at such price,

upon such terms and conditions and for such purposes as the Directors

may in their absolute discretion deem fit provided that the aggregate

number of shares to be issued pursuant to this Resolution does not exceed

10% of the total issued share capital of the Company for the time being

AND THAT the Directors be and are also empowered to obtain the

approval for the listing of and quotation for the additional shares so issued

on Bursa Malaysia Securities Berhad AND THAT such authority as

abovementioned shall continue in force until the conclusion of the next

Annual General Meeting of the Company.

Proposer : Ch’ng Sing May

Seconder : Noor Syafiqah Binti Azani



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(C) Proposed Renewal of Shareholders’ Mandate for Existing Recurrent

Related Party Transactions of a Revenue or Trading Nature

(“Proposed Mandate”)

THAT subject always to the Main Market Listing Requirements of Bursa

Malaysia Securities Berhad (“MMLR”), approval be and is hereby given

to the Company and/or its subsidiaries, pursuant to paragraph 10.09 read

with Practice Note 12 of the MMLR, to enter into recurrent related party

transactions of a revenue or trading nature with the related parties as set

out in Part A [section 2.4(A)] of the Circular to the Shareholders of the

Company dated 26 March 2018 in relation to the Proposed Mandate,

which are necessary for the Company and/or its subsidiaries’ day-to-day

operations provided that the transactions are in the ordinary course of

business and are on normal commercial terms which are not more

favourable to the related parties than those generally available to the public

and are not to the detriment of the minority shareholders of the Company;

and provided further that the disclosure for all such transactions is made in

the annual report of the Company of the aggregate value of all such

transactions conducted pursuant to the shareholders' mandate during the

financial year where:

(a) the consideration, value of the assets, capital outlay or costs of the

aggregated transactions is equal to or exceeds RM1 million; or

(b) any one of the percentage ratios of such aggregated transactions is

equal to or exceeds 1%,

whichever is the higher.

AND THAT such approval shall continue to be in force until:

(i) the conclusion of the next Annual General Meeting (“AGM”) of

the Company following the 44th AGM, at which time it will lapse

unless such authority is renewed by a resolution passed at the next

AGM of the Company;

(ii) the expiration of the period within which the next AGM of the

Company is required to be held pursuant to Section 340(2) of the

Companies Act 2016 (“Act”), (but shall not extend to such

extension as may be allowed pursuant to Section 340(4) of the

Act); or

(iii) revoked or varied by resolution passed by the shareholders of the

Company in a general meeting,

whichever is the earlier.

AND FURTHER THAT the Directors of the Company and/or its

subsidiaries, whether solely or jointly, be and are hereby authorised to

complete and do all such acts and things including executing such relevant

documents as they may consider expedient or necessary to give effect to

the Proposed Mandate.



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Proposer : Siti Nuradiba Bin Ahmad Shaharuddin

Seconder : Ong Leong Huat

(D) Proposed Renewal of Existing Share Buy-Back Authority

THAT subject to the Companies Act 2016 (“Act”), the Main Market

Listing Requirements of Bursa Malaysia Securities Berhad (“Bursa

Securities”), the Company’s Articles of Association and other applicable

laws, rules, regulations and guidelines of the relevant authorities, the

Directors of the Company be and are hereby authorised to purchase such

number of ordinary shares in the Company’s issued and paid-up capital

through the Bursa Securities at any time and upon such terms and

conditions and for such purposes as the Directors may in their discretion

deem fit subject to the following:

(a) the aggregate number of shares which may be purchased and/or

held by the Company shall not exceed ten per centum (10%) of the

issued and paid-up ordinary share capital of the Company for the

time being (“Texchem Shares”);

(b) the maximum funds to be allocated by the Company for the purpose

of purchasing the Texchem Shares shall not exceed the total retained

profits of RM258,521,000 of the Company as at 31 December 2017;

(c) the authority conferred by this Resolution will be effective

immediately upon the passing of this Resolution and will continue

in force until:

(i) the conclusion of the next Annual General Meeting

(“AGM”) of the Company following the 44th AGM in

which the resolution for the Proposed Renewal of Existing

Share Buy-Back Authority is passed, at which time the

authority will lapse unless renewed by ordinary resolution,

either unconditionally or subject to conditions; or

(ii) the expiration of the period within which the next AGM is

required by law to be held; or

(iii) revoked or varied by ordinary resolution of the shareholders

of the Company in general meeting,

whichever is the earlier, but so as not to prejudice the completion

of purchase(s) by the Company made before the aforesaid expiry

date and in any event, in accordance with the Main Market Listing

Requirements of the Bursa Securities or any other relevant

authorities;



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(d) upon completion of the purchase(s) of the Texchem Shares by the

Company, the Directors of the Company be and are hereby

authorised to deal with the Texchem Shares in the following

manner:

(i) to cancel the Texchem Shares so purchased; or

(ii) to retain the Texchem Shares so purchased as treasury

shares for distribution as dividend to the shareholders

and/or resell on the market of the Bursa Securities and/or

for cancellation subsequently; or

(iii) to retain part of the Texchem Shares so purchased as

treasury shares and cancel the remainder; or

(iv) in such other manner as the Bursa Securities and such other

relevant authorities may allow from time to time.

AND THAT authority be and is hereby given to the Directors of the Company to

take all such steps as are necessary including to enter into any agreements,

arrangements and guarantees with any party or parties to implement, finalise and

give full effect to the aforesaid with full powers to assent to any conditions,

modifications, revaluations, variations and/or amendments (if any) as may be

imposed by the relevant authorities or as may be deemed necessary by the

Directors and to do all such acts and things as the Directors may deem fit and

expedient in the interests of the Company.

Proposer : Lau Eng Hwa

Seconder : Chin Kim Cheng

8. CONFIRMATION OF MINUTES

RESOLVED THAT the minutes of the Meeting be and was hereby confirmed

instanter.

9. CLOSE OF MEETING

There being no further business, the Meeting was declared closed at 1.20p.m. with

a vote of thanks to the Chair.

CONFIRMED AS A TRUE RECORD

- Signed -

____________________________

Tan Sri Dato’ Seri (Dr.) Fumihiko Konishi

Executive Chairman

Date: 24 April 2018

Appendix 1

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RESOLUTIONS PROPOSED AND DULY PASSED AT THE FORTY-FOURTH ANNUAL GENERAL MEETING

Resolutions Voted For Voted Against Results

No. of shares

% No. of shares %

Resolution 1

Re-election of Dato’ Seri Nazir Ariff Bin

Mushir Ariff who retires pursuant to Article

123 of the Company’s Articles of Association

64,443,415

98.4546 1,011,550 1.5454 Carried

Resolution 2

Re-election of Cik Zarizana @ Izana Binti

Abdul Aziz who retires pursuant to Article

123 of the Company’s Articles of Association

64,382,115 98.4086 1,041,150 1.5914 Carried

Appendix 1

Page 2 of 3



No. of shares

% No. of shares %

Resolution 3

Approval of the Directors’ fees for the

financial year ended 31 December 2017

64,792,160 98.2876 1,128,850 1.7124 Carried

Resolution 4

Approval of the Directors’ benefits for the

financial year ended 31 December 2017

64,393,340 98.3450 1,083,650 1.6550 Carried

Resolution 5

Re-appointment of Messrs KPMG PLT as

Auditors and authorisation of Directors to fix

their remuneration

64,510,665 98.4278 1,030,450 1.5722 Carried

Resolution 6

Approval to retain Dato’ Seri Nazir Ariff Bin

Mushir Ariff as an Independent Non-

Executive Director of the Company

Tier 1 (Large Shareholder)

48,819,972 100 0 0 Carried

Tier 2 (Other Shareholders)

15,732,058 98.9661 164,350 1.0339 Carried

Appendix 1

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No. of shares

% No. of shares %

Resolution 7

Approval to retain Dato’ Danny Goon Siew

Cheang as an Independent Non-Executive

Director of the Company

Tier 1 (Large Shareholder)

48,819,972 100 0 0 Carried

Tier 2 (Other Shareholders)

15,970,473

99.6481 56,400 0.3519 Carried

Resolution 8

Approval of the Power to Issue Shares

pursuant to Section 75 and Section 76 of the

Companies Act 2016

64,744,445 99.9185 52,800 0.0815 Carried

Resolution 9

Approval of the Proposed Renewal of

Shareholders’ Mandate for Existing Recurrent

Related Party Transactions of a Revenue or

Trading Nature

10,829,101 91.5525 999,200 8.4475 Carried

Resolution 10

Approval of the Proposed Renewal of Existing

Share Buy-Back Authority

64,773,495 98.5356 962,650 1.4644 Carried

deavagi

Typewritten Text

Appendix 2


deavagi

Typewritten Text

- Signed -

deavagi

Typewritten Text

deavagi

Typewritten Text

Appendix 3



1

Pertinent Questions and Answers and Comments during the 44th Annual General Meeting

Mr Ong Leong Huat raised the following questions:

Question 1:

Industrial Division has been profitable but its profitability has not exceeded RM10 million.

Please explain the reason why the Division was unable to achieve profit exceeding RM10

million and whether Industrial Division can make a break through.

Answer 1:

Mr Yap Kee Keong explained that in the past 2 years, Industrial Division has persistently

improved on its revenue and profitability from RM7 million to RM9 million and it is the

Management’s objective to continuously improve on the Division’s profitability.

Question 2:

Which sector is the main profit contributor in the Polymer Engineering Division (“PED”) and

please explain the reason for decrease in sales from the consumer electronic & electrical

(“E&E”) segment.

Answer 2:

Mr Yap explained that PED had been facing challenging times since 2009. Traditionally, E&E

segment was the main contributor. However, E&E segment is very volatile as new gadgets or

models were being launched very quickly. In this respect, the Management has moved into the

medical/life science segment, a relatively stable industry, which has begun to contribute to

PED’s profitability. Mr Yap further elaborated that Hard Disk Drive (“HDD”) segment

remained profitable with Texchem being a market leader in the HDD segment.

Question 3:

What is the progress in the aerospace and automotive segments?

Answer 3:

Mr Yap replied that automotive segment was a new area for PED and ground works were being

carried out in this segment while PED has been working on the aerospace segment for the past

3 years with focus on the engineering facility within our factory in Prai.

Question 4:

Food Division has been suffering losses for a very long time. When do you expect to

turnaround this Division? It was noted that the Division has embarked on aquaculture and

enquired on the gestation period for this.

Answer 4:

Dato’ Brian Tan explained that it would take 2 to 3 years to see the results of Food Division’s

investment. As the landing of raw materials was unpredictable, Food Division has embarked

on aquafarming with the current location of Barramundi in Myanmar. The gestation period for

aquafarming was approximately 18 months. Food Division was also transforming its existing

food processing facility into a central kitchen concept with the objective of diverting to more

profitable investment.

Appendix 3



2

Question 5:

Sushi King is doing well but other brands are pulling down the profits in Restaurant Division.

When can Restaurant Division turnaround this situation?

Answer 5:

Tan Sri Fumihiko Konishi replied that it would take approximately 3 years to introduce a new

brand with the objective of building a profitable business. Time is required to see how a new

brand would fare in the Malaysian market. Despite the challenges faced, Restaurant Division

will continue to introduce good food, new brands and build market share.

Question 6:

Why did Restaurant Division start a coffee business in Malaysia since there are so many other

well established coffee brands such as Starbucks in the market?

Answer 6:

Tan Sri Fumihiko Konishi replied that Hoshino Coffee is well known in other countries such

as Singapore for its specialty hand drip coffee and good food and these differentiated Hoshino

Coffee from other coffee brands which use pressure and steam in their coffee making process.

Question 7:

What is the purpose for setting up Kokubu Food Logistics Malaysia Sdn Bhd (“Kokubu”)?

Answer 7:

Mr Wong Kin Chai, the Managing Director of Kokubu, explained that Kokubu was set up to

optimise internal business by reducing the logistic costs for Sushi King and to expand its

business by providing logistics services to external customers.

Question 8:

The turnover for Venture Business Division is very low. Is it set up for in-house purposes?

Answer 8:

Tan Sri Fumihiko Konishi explained that Texchem Polymers Sdn Bhd (“TXPO”), a company

under Venture Business Division, is involved in research & development. TXPO is producing

bio-based plastic using agricultural waste and this is being patented. This is a futuristic

business for Texchem Resources Bhd Group.

Question 9:

The share price is very depressed. Please explain how to increase shareholders value.

Answer 9:

Tan Sri Fumihiko Konishi informed the Meeting that the current share price is undervalued as

it is equivalent to approximately 1/3 of the Company’s Net Tangible Assets. Texchem

Resources Bhd Group (“TRB Group”) was not making profit as TRB Group has spent a huge

sum of money on research & development and to bring in new businesses which results would

require time to materialise. Tan Sri Fumihiko Konishi informed that TRB Group’s overall cash

flow and gearing are healthy. Focus would be placed on Food Division which is suffering

losses due to poor natural landing. The Management has taken measures to venture into

aquafarming and to reduce operating costs.

Appendix 3



3

Question 10:

Mr Chow Wai Moon enquired why the questions from Minority Shareholder Watchdog Group

(“MSWG”) were not stated in the Annual Report.

Answer 10:

Tan Sri Fumihiko Konishi replied that the Company received questions from MSWG on 23

April 2018, a day before the Annual General Meeting. Thus, all questions and answers would

be presented in the Meeting. A copy of the Company’s letter of reply to MSWG is attached

herewith as Appendix 2.

Question 11:

The representative from MSWG asked the Board to elaborate on the scheme of payment of

benefits to Directors upon retirement/resignation.

Answer 11:

Tan Sri Fumihiko Konishi explained that it is a scheme to retain and to remunerate Directors.

The scheme would provide such amount which would be paid to those Directors who have

completed 10 years’ service.

Question 12:

Mr Chin Kim Cheng enquired on the Company’s plan with respect to the treasury shares.

Answer 12:

Tan Sri Fumihiko Konishi replied that currently, there is no plan regarding the treasury shares

due to the small number of treasury shares being held. The Company will keep shareholders

informed as and when a plan is formalised.

[End]

TEXCHEM RESOURCES BHD. (Company No. 16318-K) … · TEXCHEM RESOURCES BHD. (16318-K) MINUTES OF THE...

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