Annual Report 2022 143 ABOUT US LEADERSHIP PERSPECTIVE SUSTAINABILITY GOVERNANCE FINANCIAL STATEMENTS Other Information Notes to the Financial Statements for the Financial Year Ended 31 March 2022 (Cont’d) 24. TERM LOANS (SECURED) (cont’d) Notes:- 1 - Term loan 3 was a capital expenditure loan with tenure of up to 60 months from the first day of the following month from the date of first disbursement and is repayable by 13% of each contract proceeds received from the project until full settlement. The term loan can be renewed beyond the tenure of up to 60 months upon the renewal request and to be accepted by the Bank. 2 - Term loan 4 was a capital expenditure loan with tenure of up to 60 months from the first day of the following month from the date of first disbursement and is repayable by 20% of each contract proceeds received from the project until full settlement. The term loan will be availed to the original limit to finance any new contracts and to be accepted by the Bank. The term loans above are with floating rates ranging from 3.05% to 3.20% (2021 - 3.05% to 4.30%) per annum. Term loan 1 in the previous financial year was secured by:- (a) a legal charge over 1 unit of property of the Group; and (b) a corporate guarantee of the Company. Term loan 2 is secured by:- (a) a legal charge over certain properties of the Group; and (b) a corporate guarantee of the Company. Term loan 3 is secured by:- (a) proceeds from the project as disclosed in the footnote (Note 1) above; and (b) a corporate guarantee of the Company. Term loan 4 is secured by:- (a) proceeds from the project as disclosed in the footnote (Note 2) above; and (b) a corporate guarantee of the Company and a subsidiary. Term loan 5 is secured by:- (a) a legal charge over certain properties of the Group; and (b) a corporate guarantee of the Company. Term loan 6 is secured by:- (a) a legal charge over certain properties of the Group; and (b) a corporate guarantee of the Company. Term loan 7 is secured by:- (a) a legal charge over a property of the Group; and (b) a corporate guarantee of the Company. During the financial year, term loan 3 amounting to Nil (2021 - RM7,394,000) is secured by a negative pledge that imposes certain covenants on a subsidiary that has received the loan. The significant covenant of the term loan is that the Company’s gearing shall not exceed 3.5 times during the subsistence of the financing facilities with the bank.
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