My EG Services Berhad Annual Report 2020

MY E.G. SERVICES BERHAD Regisration No. 200001003034 (505639-K) 232 NOTES TO THE FINANCIAL STATEMENTS For The Financial Year Ended 31 December 2020 (CONT’D) 48. SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR (CONT’D) (i) On 8 October 2020, the Company received a Letter of Acceptance from the Ministry of Health, Malaysia, to undertake the provision of an online payment system for inbound travelers to register and make payment, prior to their arrival in Malaysia, for COVID-19 Screening Test and Quarantine Charges to be implemented at all entry points to the Country (“the Project”). The tenure of the Project shall be 2 years, effective from 1 November 2020. On 3 November 2020, the Company officially launched MySafeTravel, a digital health pass system for travelers aimed at making entry into Malaysia amidst the ongoing COVID-19 pandemic faster, simpler and safer. On 5 November 2020, the Company entered into an Agency Agreement with the Government of Malaysia to facilitate the collection of dues and/or payments under any payments made in relation to or arising from COVID-19 detection test and/or quarantine station charges issued by the Government to the public. (j) On 5 December 2020, the Company entered into a Memorandum of Understanding (“MOU”) with Anhui Zhifei Longcom Biopharmaceutical Co., Ltd (“Zhifei”) to conduct phase 3 clinical trials and subsequent commercialisation of Zhifei’s COVID-19 Vaccine in Malaysia. The MOU is valid for a period of 3 years from the date of signing. (k) On 9 December 2020, the Company proposed to undertake the issuance of up to 220,000,000 new MYEG Shares (“Placement Shares”) amounting to RM407.0 million (“Illustrative Proceeds”), representing up to about 6.29% of the total number of issued MYEG Shares (excluding treasury shares). The purposes for the new Placement Shares are as below:- (i) development of foreign workers hostels under the foreign workers accommodation programme (“FWAP”) of RM94.5 million; (ii) development of healthcare related services of RM168.0 million; (iii) purchase of fixed assets and related solutions for E-government concession services of RM126.0 million; (iv) working capital of RM9.1 million; and (v) expenses for the proposed placement estimated at RM9.4 million. On 17 December 2020, the Company further announced that the first tranche of the Placement has been completed with a placement of 120,000,000 new MYEG Shares fixed at issue price of RM1.80 per Placement Share. Total gross proceeds is amounted to RM216.0 million. 49. SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD (a) On 8 January 2021, the Company and Zhifei had received affirmations of support and assistance from the Ministry of Health Malaysia and Clinical Research Malaysia respectively for the commencement of clinical trials in the country, subject to the existing laws and regulations governing such clinical trials. On 22 February 2021, MYEGM, a wholly-owned sub-subsidiary of the Company had entered into a Supply and Distribution Agreement (“the Agreement”) with Zhifei for the purpose of appointing MYEGM as the exclusive distributor in Malaysia of the COVID-19 Vaccine for a period of 3 years; thereby supersede the MOU signed on 5 December 2020. On 8 March 2021, the Company had further clarify the following areas of cooperation continue to subsist and have been formalised in the Agreement:- (i) to conduct phase 3 clinical trials of Zhifei’s COVID-19 Vaccine; (ii) to achieve compliance to Halal status requirements to secure Halal certification from the Department of Islamic Development Malaysia (JAKIM); and (iii) to be the exclusive distributor of the COVID-19 Vaccine in Malaysia for a period of 3 years.