Zhitong Financial App News, JBB BUILDERS (01903) announced that on March 17, 2022, JBB Kmlun, a non-wholly owned subsidiary of the company, entered into an Astaka Padu-JBB Kmlun settlement agreement with Astaka Padu. JBB Kmlun conditionally agreed to settle the total amount due to JBB Kmlun and Astaka Padu in the following manner in accordance with the MBJB general contractor agreement. The outstanding contract amount is about 24.8 million ringgit:
Under the Astaka Padu Group-JBB Kmlun write-off Agreement, 11 counter-sale properties were transferred from the Astaka Padu Group; the Astaka Padu-JBB Kmlun cash settlement amount of Astaka Padu was accepted under the outstanding contract payment arrangement; and 6 separate and conditionally transferable write-off options granted by Astaka Padu in accordance with the write-off option instrument.
On the same date of the Astaka Padu-JBB Kmlun settlement Agreement, JBB Kmlun and the Astaka Padu Group also entered into the Astaka Padu Group-JBB Kmlun write-off Agreement, in which it was agreed that the amount of the Astaka Padu-JBB Kmlun set-off settlement should be offset if the 11 countervailing properties were transferred by way of counterwriting to the nominee of JBB Kmlun (i.e. Kmlun) or other third party as determined by Kmlun at the purchase price of the countervailing property.
Upon the transfer of the counter property under the Astaka Padu Group-JBB Kmlun countersale Agreement, the Agreement will settle the Astaka Padu-JBB Kmlun countersale settlement amount, and Astaka Padu will fulfill the remaining payment obligations under the Astaka Padu-JBB Kmlun settlement Agreement, namely the Astaka Padu-JBB Kmlun cash settlement amount, and the outstanding contract amount will be deemed to have been fully and finally settled by Astaka Padu, and JBB Kmlun shall not make any further claim against Astaka Padu in respect of the MBJB General contractor Agreement.
On April 14, 2022, JBB Kmlun entered into the JBB Kmlun-Kmlun settlement Agreement, and JBB Kmlun conditionally agreed to settle the outstanding subcontract amount due to Kmlun and JBB Kmlun in the following manner in accordance with the MBJB subcontractor Agreement:
In accordance with the terms of the Astaka Padu Group-JBB Kmlun countersale Agreement, 11 countervailing properties are transferred to Kmlun; JBB Kmlun-Kmlun cash settlement amount is provided under the outstanding subcontract payment arrangement; and in accordance with the countervailing option paper and the Astaka Padu-JBB Kmlun settlement Agreement, Kmlun is granted the right to nominate itself or its nominee as the recipient of the 6 countervailing options.
Upon the transfer of the counter-sale property by the Astaka Padu Group and the cash settlement amount paid by JBB Kmlun to JBB Kmlun-Kmlun, the outstanding subcontract amount (i.e. the JBB Kmlun-Kmlun property settlement amount and the JBB KmlunKmlun cash settlement amount) will be deemed to have been fully and finally settled by JBB Kmlun and Kmlun shall not make any further claim against JBB Kmlun of any nature in respect of the MBJB subcontractor Agreement.
Through the Astaka Padu-JBB Kmlun transaction, the Group will transfer the countervailing property settlement Astaka Padu-JBB Kmlun settlement amount, immediately no longer face some of the credit risk associated with the outstanding contract amount, and pay cash in an orderly manner through Astaka Padu, no longer face other credit risks related to the outstanding contract amount, which will improve the Group's financial performance in the future.
Through the JBB Kmlun-Kmlun transaction, the Group will settle the outstanding trade payables with Kmlun, which will help the Group to maintain its business relationship with Kmlun. The outstanding subcontract payment arrangements also give the Group the flexibility to settle outstanding trade payables, which helps the Group to maintain a sound cash position.
By entering into these transactions, trade receivables due from Astaka Padu of approximately 12.9 million ringgit will be offset by trade payables due to Kmlun of approximately 12.9 million ringgit. The trade receivables due from Astaka Padu of approximately 5.9 million ringgit and approximately 6 million ringgit will be settled after Astaka Padu settles the monthly installments of Astaka Padu-JBB Kmlun and the remaining deposit in accordance with the Astaka Padu-JBB Kmlun settlement Agreement, while the trade payables due to Kmlun of approximately 5.6 million ringgit and 6 million ringgit will be settled after JBB Kmlun settles the monthly installments and remaining deposit of JBB Kmlun-Kmlun in accordance with the JBB Kmlun-Kmlun settlement Agreement, respectively.