Company Name: KOBAY TECHNOLOGY BERHAD
Stock Name: KOBAY
Date Announced: 31 May 2016
Category: General Announcement for PLC
Reference Number: GA1-31052016-00127
The Board of Directors of Kobay Technology Bhd. (“Kobay”) wishes to furnish herewith additional information in respect to our announcement dated 27 May 2016.
1) Details of the joint development project (including the project sum) and information of the land
The intended joint development project is on a piece of land located at Lot 282, Seksyen 63, Daerah Bandar Kuala Lumpur with land size of approximately 4.7474 acres (“the Land”). The Land is a freehold commercial land fronting Persiaran Stonor and Jalan Eaton. The Land is intended for a mixed development project consists of a 5-star hotel, commercial buildings and high end condominium. Based on the estimated plot ratio of 12 times, the gross development value is estimated at RM1.5 billion. Based on the proposal, the Landowner shall be entitled for the hotel block and the developer shall be entitled to build and sell the remaining development. The terms and other considerations shall be further negotiated and finalised by the parties prior to execution of the joint development agreement (“JDA”).
2) Rationale to pay a deposit sum of RM3,400,000 to the Landowner’s Stakeholder when KOBAY has yet to execute any joint development agreement or any other formal and binding arrangement with the landowner
USSB was requested by the Stakeholder to deposit a non-forfeitable stakeholder sum of RM3,400,000 to the Stakeholder prior to the execution of JDA as proof of fund on the availability of financial resources to participate in the proposed JDA. USSB’s Solicitor has received confirmation from the Stakeholder on its appointment to represent the Landowner for the JDA, and had issued a Letter of Interest which imposed express undertakings onto the Stakeholder, inter alia :-
1. to hold the said stakeholder sum as stakeholder, on the Stakeholder’s express undertaking not to release the same to the Landowner until and after receipt of the duly executed JDA;
2. to place the said stakeholder sum in an interest bearing account with a reputable bank;
3. to refund the said stakeholder sum to USSB’s solicitor together with interest accruing thereon in the event the JDA is not be finalized and executed on or before 31 October 2015.
With the Stakeholder’s acceptance on the expressed conditions as stated above, and relying on the Stakeholder’s legal duties and contracture obligations, Kobay proceeded to place the said stakeholder sum vide USSB’s appointed Solicitor
3) Identify and name of the Landowner and Stakeholder, as well as USSB’s Solicitor
The land owner is Lambaga Getah Malaysia, a statutory authority responsible for management of the rubber industry in Malaysia.
The Stakeholder, Miss Jaswinder Kaur of Messrs Jaswinder Kaur Gill & Associates, is a practising advocate and solicitor based in Selangor state.
Messrs Raziah & Partners, a Penang based legal firm, is the Solicitor appointed by USSB to deal with the JDA.
The Stakeholder and USSB’s Solicitor firm are the members of Malaysian Bar Council.
4) The steps/actions that were taken by the Board to recover the deposit amount
Upon expiry of the date to execute the JDA, Kobay has made numerous attempts via USSB’s Solicitor requesting for the repayment of stakeholder sum, however failed. A Police report was made on 27 November 2015 against the Stakeholder for the non-repayment. Subsequently, on 18 January 2016, Kobay managed to obtain a cheque from the Stakeholder for the full repayment of the stakeholder sum, but the cheque was unable to be honoured. On 21 March 2016, the Stakeholder’s firm provided a written undertaking to USSB undertook to refund the stakeholder sum by 31 March 2016, but did not materialise.
On 27 May 2016, the police has instigated charge under Section 420 of the Penal Code against the Stakeholder and one Mr. K. James, a property consultant for cheating and inducing USSB to pay the stakeholder sum.
Beside the police’s action against the Stakeholder, Kobay is pursuing alternative legal avenues to recover the stakeholder sum, which include civil suit against the Stakeholder and seeking remedy from the firm’s professional indemnity insurance and the professional body’s compensation fund.
5) Whether the directors and/or major shareholders and/or person connected with a director or major shareholders have any interest, direct and indirect, in the transaction and the nature and extent of their interest, if any.
None of the directors nor any major shareholders and/or person connected with the director or major shareholder has any interest, direct and indirect, in the transaction.
This announcement is dated 31 May 2016.