MEMORANDUM OF UNDERSTANDING NESTCON BERHAD ("NESTCON" OR "THE COMPANY") - UPDATE ON THE MEMORANDUM OF UNDERSTANDING BETWEEN NAM HENG SAFETY GLASS SDN. BHD. AND THE COMPANY

NESTCON BERHAD

Type Announcement
Subject MEMORANDUM OF UNDERSTANDING
Description
NESTCON BERHAD ("NESTCON" OR "THE COMPANY") - UPDATE ON THE MEMORANDUM OF UNDERSTANDING BETWEEN NAM HENG SAFETY GLASS SDN. BHD. AND THE COMPANY
Reference is made to the Company’s announcements made on 9 August 2022, 25 August 2022, 24 November 2022, 27 February 2023, 29 May 2023, 29 August 2023, 28 November 2023, 19 December 2023, 26 December 2023, 28 February 2024 and 30 May 2024. The Board of Directors of Nestcon (“the Board”) wishes to update the status of the Memorandum of Understanding ("MOU") dated 9 August 2022 between Nestcon and Nam Heng Safety Glass Sdn. Bhd., as follows:-

1. INTRODUCTION

The Board wishes to announce that Nestcon Solar Sdn. Bhd. (“NSSB”), a wholly-owned subsidiary of Nestcon Sustainable Solutions Sdn. Bhd., a 51% owned subsidiary of the Company had on 5 June 2024, entered into an agreement (“Agreement”) with Subang Safety Glass Sdn. Bhd. (“the Customer”) in relation to develop, design, install, construct and commission a solar photovoltaic system (“PV System”) at the rooftop of the Customer’s premises at Lot 10244, Jalan Subang 6, Taman Perindustrian Subang, 47610 Subang Jaya, Selangor (“Site”).

(NSSB and the Customer shall hereinafter be collectively referred to as “Parties” and individually as “Party”).

2. INFORMATION ON THE CUSTOMER

The Customer is a company incorporated in Malaysia and its registered address is Level 7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, 50490 Kuala Lumpur, Wilayah Persekutuan. The Customer is principally engaged in processing and marketing of all kinds of safety glass.

3. DETAILS OF THE AGREEMENT

3.1  Pursuant to the Agreement, NSSB shall to develop, design, install, construct and commission a PV System at the Site.

3.2  The total contract price of the PV System is RM3,596,112.00 (“Contract Price”) and may be adjusted by change orders of the Customer in accordance with the terms of the Agreement. The Contract Price is made payable to NSSB in accordance with the progress payment schedule based on the completed milestone of the PV System as indicated in the Agreement.

3.3  The effective date shall occur on the first day falling after the date on which the following conditions are satisfied, unless waived by either Party (“Effective Date”):

(a) receipt of the approval to the application for net energy metering from Sustainable Energy Development Authority (“SEDA”) by the Customer;
(b) completion of the Connection Assessment Study;
(c) completion of a satisfactory physical inspection and assessment report of the Site by NSSB and/or its nominated representative to confirm in NSSB’s reasonable opinion the suitability or condition of the Site; and
(d) such other conditions as may be prescribed by NSSB.

3.4  The Commercial Operation Date shall occur on the first day after the date on which the following conditions are satisfied, unless waived by NSSB (“Commercial Operation Date”):- 

(a) the PV System is fully commissioned and is generating electrical output which is approximately twelve (12) months from the Effective Date; and
(b) Commencement Approval has been received by the Customer from SEDA and other related authorities, where applicable.

3.5  The defect liability period shall be two (2) years from the Commercial Operation Date.

4. RISK FACTORS

The Agreement is in the ordinary course of business of Nestcon Group. As such, Nestcon Group will not be exposed to risks that Nestcon Group is not already exposed to. Nevertheless, the Group will take the necessary steps to mitigate the risks as and when they occur.

5. FINANCIAL EFFECTS 

(a) The Agreement will not have any effect on the issued share capital and the shareholding of the substantial shareholders of Nestcon.
(b) The Agreement is expected to contribute positively to the earnings and net assets of Nestcon Group upon the successful implementation and execution of the PV System.
(c) The Agreement is not expected to have any and/or will not have any material effect on the gearing of Nestcon Group.

6. APPROVAL REQUIRED 

The Agreement is not subject to the approval of shareholders and any other relevant authorities.

7. DIRECTORS’ AND MAJOR SHAREHOLDERS’ INTERESTS 

None of the Directors and/or major shareholders of Nestcon or any persons connected with them have any interests, direct or indirect, in the Agreement.

8. STATEMENT BY THE BOARD OF DIRECTORS

The Board, having taken into consideration all aspects of the Agreement, is of the opinion that this Agreement is in the best interest of Nestcon Group.

This announcement is dated 5 June 2024.





Announcement Info

Company Name NESTCON BERHAD
Stock Name NESTCON
Date Announced 05 Jun 2024
Category General Announcement for PLC
Reference Number GA1-05062024-00023