094 KIMLUN CORPORATION BERHAD • AUDIT AND RISK MANAGEMENT COMMITTEE REPORT SUMMARY OF CONFLICT OF INTEREST OR POTENTIAL CONFLICT OF INTEREST SITUATION Details of new conflict of interest (“COI”) situations involving Directors and key senior management of the Company in FY2025, and the measures taken to resolve, eliminate, or mitigate such conflicts, are set out below: 1. Potential Business Competition Nature A property development company (“PD Co”) in which the Company’s Directors, namely, Mr. Pang Tin @ Pang Yon Tin and Mr. Pang Khang Hau (collectively “the Declarants”), together with their immediate family members have 95% shareholding (“Company A”), acquired 2 parcels of land (“PD Land”) situated about 3 kilometers from 3 parcels of adjacent land owned by the Group (“KCB Land”) in Johor Bahru, Johor. Given the geographical proximity, future development on the PD Land may potentially compete with the Group’s development on the KCB Land. Factors Considered by the ARMC and the Mitigation Plan (i) Right of First Refusal • The Declarants granted the Group the first right to consider acquiring the PD Land. • Management declined the acquisition due to: (a) Recent acquisitions of several parcels of land since 2024; (b) Planned rollout of at least three new development projects, including the KCB Land, in 2025 and 2026; (c) Significant construction and manufacturing orders in hand, all of which require substantial working capital and resources. (ii) Assessment of Potential COI After review, the ARMC concluded that the perceived COI was unlikely to expose the Group to significant risks, based on the following: Factors KCB Land PD Land Product differential Serviced apartment for sale Intended to build commercial properties for rental income Timing of development Advanced stage of planning; launch expected in third quarter of 2026 Development planning and approvals expected to take at least 2 years post-acquisition (iii) Mitigation Measures (a) The Declarants will abstain from all deliberations and decisions relating to the KCB Land development; and (b) The Declarants will notify the Group of PD Land’s development details once finalised.
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