My EG Services Berhad Annual Report 2019

MY E.G. SERVICES BERHAD [Registration No. 200001003034 (505639-K)] 200 NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2019 (CONT’D) 53. SIGNIFICANT EVENTS OCCURRING AFTER THE REPORTING PERIOD (CONT’D) (c) On 28 April 2020, the Company’s joint venture, MYEG Philippines launched a contact tracing and digital health profiling smartphone application known as MyEGuard and commenced pilot implementations for cities in Philippines. The roll-out of MyEGuard will enable authorities to carry out contact tracing to contain the COVID-19 pandemic. (d) On 21 May 2020, the Company had received an official notification from the Government to continue with the provision of the E-Government Services (including the provision of the electronic delivery of vehicle registration, driver and vehicle licensing, and payment of summon services) until 30 June 2020. On 22 May 2020, the Company had also received an official notification from the Government to continue with the provision of the Immigration Related Services (including the provision of online renewal of temporary employment pass for foreign workers or “Pas Lawatan Kerja Sementara”) for the Immigration Department of Malaysia until further notice. This is to allow the Government sufficient time to finalise the status of the extension of these agreements subsequent to their expiration on 22 May 2020. The Group is committed to pursue the extension of these agreements with the Government. As at to date, the Group is still awaiting for the Government’s decision on these extensions. Revenue generated from the ‘concession based services’ and ‘commercial based - concession related services’ for the 15 month period up to December 2019 contributed 19% of the Group’s overall revenue (15 month period up to September 2018 - 19%). (e) On 5 June 2020, PT Cartenz Tekno Lab, a wholly-owned subsidiary of PT Cartenz, an associate company of MYEG, had entered into a Memorandum of Understanding (“MOU”) with Jakarta Smart City Management Unit to provide and implement a contact tracing application for the province of Jakarta to manage the spread of the COVID-19 virus. (f) On 10 June 2020, MYEGC had entered into a Share Sales Agreement (“SSA”) and Put and Call Option Agreement (“PCOA”) with Merrington Assets Limited (“MAL”) for the purchase of 118,000,000 ordinary shares of S5 Holdings Inc. (“S5”), representing 10% of the issued and paid-up share capital of S5 by MYEGC from MAL for a total consideration of RM90 million, to be satisfied partly by cash consideration of RM75 million and the balance sum of RM15 million to be satisfied by the allotment and issuance of 12,500,000 new ordinary shares (at RM1.20 per share) in the Company (“Consideration Shares”) to MAL. Completion of the SSA is conditional on:- (i) the Company obtaining approval of Bursa Malaysia Securities Berhad (“Bursa Securities”) for the listing of and quotation for the 12,500,000 new ordinary shares (at RM1.20 per share) in the Company, representing 0.36% of the existing total issued and paid-up capital of the Company (excluding treasury shares); and (ii) MYEGC and/or the Company conducting or cause to be conducted a due diligence on S5 Group to the satisfaction of MYEGC and/or the Company. The conditions precedent shall be satisfied on or before 30 September 2020 (“Cut-Off Date”). Thereafter, the parties may have an extension of time as may be agreed between the parties. On 11 June 2020, the application for the listing of and quotation for the Consideration Shares, which is to be issued pursuant to the Proposed Acquisition, has been submitted to Bursa Securities.