In reference to the Company’s announcement dated on 24 February 2025 pursuant to the extension of the Joint Venture Agreement between Duta Skyline Sdn. Bhd. and Amazing Symphony Sdn. Bhd. (collectively refers to as “the Parties”), the Company wishes to further announce on the following:-
1. Further Extension for 5 years of the JVA between the Parties:
The on-going legal matters and its overall implications had adverse material effect to the previous Joint Venture Agreement (JVA) signed between the Parties. These litigation matters directly affects and imposed restrictions on the abilities of the parties involved to move forward pursuant to the terms of the JVA. In specific reference to several applications for interim injunction(s) by the opposing 3rd parties, which restrains the Parties from collaborating on the Project Land (“Lot 613”), that created significant legal obstacles. Further, application of caveats were also filed by the opposing parties to restricts any development and/or transaction on Lot 613 during the period of the previous JVA.
As these legal proceedings are still on-going and pending, particularly with respect to the injunction(s), caveat and related suit (Suit 122) for the Company, the Parties put on hold the development process based on the previous JVA on the stipulated Lot 613. Further delays due to pandemic factors affecting the timeline for court proceedings impacts the ability to carry out all necessary actions as stipulated in the previous Joint Venture Agreement (JVA), such as development and/or transactions involving the Project Land Lot 613.
2. Rationale on the 5-Year Extension for the Company:
The on-going nature of the legal dispute(s) has a direct and significant impact on the timeline for the previous Joint Venture project between the Parties. The impending court decision(s) and different restrictions imposed on Lot 613 further restricts the Parties' ability to proceed with the collaboration project within the original timeline. In respect to this, the Parties have agreed that a further extension of an additional 5 years period is required to account for the delays caused by these material and significant legal issues with the unforesight of the Covid pandemic that occurred during the period of the JVA between the Parties.
This 5-year extension period is deemed necessary as the Parties are unable to fulfil and proceed with all the planned submissions, applications and/or activities as per initially agreed upon, due to factors mentioned above. This extension period shall give the Parties sufficient time to resolve the legal matters, removing all courts’ restrictions, seeking compensations and to resume the Parties obligations pursuant to the intended JVA.
3. Timeline of Events:
There were four (4) separate Interlocutory injunction relief and Interim injunctions filed against the previous JVA which were granted by the High Court on 28 August 2019, 11 September 2019, 30 September 2019 and 14 October 2019 respectively, that imposed restrictions and injuncted the Parties to fulfil all terms and conditions of the JVA. There were further two (2) caveats filed and entered onto the Project Land on 3 October 2022 and 7 October 2022 respectively by the opposing parties.
Specific reference is made to BA-24NCC-122-08/2019 (Suit 122): This legal suit is material and imposed High Court orders relating to the previous JVA signed between the Parties. The High Court awarded the order(s) related to this case on 27 May 2022. Thereafter, Duta Skyline Sdn. Bhd. lodged an appeal to the Court of Appeal.
The Appeal: Duta Skyline Sdn. Bhd. filed an appeal against this order on 15 June 2022, challenging the High Court’s decision.
The Decision: Court of Appeal (COA) on 22 May 2023 held that the appeal was allowed, and the COA set aside the High Court's order on 27 May 2022, lifting the injunction(s) previously imposed by the High Court.
The Damages Assessment: The COA's decision further allowed the Parties to apply for assessment of damages due to the earlier injunction(s) and caveat orders. These assessments shall be done in accordance with the Rules of Court 2012, which creates additional procedural delays for the Parties. As per the COA’s direction, Duta Skyline Sdn. Bhd. filed the application on 19 June 2023 and the COA has fixed the trial dates for this application on 26 May 2025 until 30 May 2025.
4. Conclusion:
The linkage between the ongoing legal matters, the injunction(s), and the caveat(s) on Lot 613 has significantly, materially and directly affected the JVA, delaying the ability of the Parties to proceed with the fulfilment of the JVA. The need for an additional 5-years extension is necessary due to the reason(s) stated above.
The Joint Venture Agreement being extended is in the ordinary course of business of the Company.
The Board of Directors of the Company, having taken into consideration of all aspects of the extension for the Joint Venture Agreement, is of the opinion that the extension of the Joint Venture Agreement is in the best interest of the Company.
This announcement is dated 26 February 2025.
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