PROGRESSIVE IMPACT CORPORATION BERHAD

PROPOSED DISPOSAL OF THE FOLLOWING PROPERTIES TO ALS TECHNICHEM (MALAYSIA) SDN BHD, A 59%-OWNED SUBSIDIARY OF THE COMPANY, FOR A TOTAL CASH CONSIDERATION OF RINGGIT MALAYSIA THIRTEEN MILLION:-

(A)       ALL THAT FREEHOLD INDUSTRIAL LAND HELD UNDER GRN 58855 LOT NO. 64269 MUKIM DAMANSARA AND BEARING POSTAL ADDRESS AS NO. 21, JALAN U8/84, BUKIT JELUTONG, SEKSYEN U8, 40150 SHAH ALAM, SELANGOR DARUL EHSAN; AND

(B)       ALL THAT FREEHOLD INDUSTRIAL LAND HELD UNDER GRN 58856 LOT NO. 64270 MUKIM DAMANSARA AND BEARING POSTAL ADDRESS AS NO. 19, JALAN ASTAKA U8/84, SEKSYEN U8, 40150 SHAH ALAM, SELANGOR DARUL EHSAN

(“THE PROPOSED DISPOSAL”)

Further to the announcement made on 8 August 2012 on the subject-matter, the Board of Directors of Progressive Impact Corporation Berhad (“the Company” or “PICORP” or “the Vendor”) wishes to provide the following additional information in respect of the Proposed Disposal.

Details of late payment charges referred to in item 4(c)

The late payment charges payable by ALS Technichem (M) Sdn Bhd (“the Purchaser”)  for the late payment of the whole balance sum of RM11,700,000 shall be the sum of RM2,564.00 only per calendar day. In the event only a part of the balance sum is remaining unpaid, then in such instance, the late payment charges payable by the Purchaser shall accordingly be reduced, proportionate to such part of the balance sum remaining unpaid and the Purchaser shall pay only such proportionately reduced late payment charges.

Consequences/compensation arising from the termination of the Sale and Purchase Agreement (“SPA”) in the event the Vendor should fail and/or refuse to complete the sale and purchase as mentioned in item 4(f)

The Vendor shall refund or cause to be refunded to the Purchaser all monies paid by the Purchaser, towards the Consideration of RM13,000,000.00, free from compensation fee or charges. The Vendor shall further pay to the Purchaser, a sum of RM1,300,000.00 only being a sum equivalent to the deposit as agreed liquidated damages.

The Purchaser shall return or cause the return to the Vendor all documents then in the possession of their solicitors with the Vendor’s interests intact provided that if the transfer documents have been duly stamped, the Purchaser shall have the right to first apply to the Collector of Stamp Duty for a refund of the stamp duty paid on the transfer documents before returning the transfer documents to the Vendor for cancellation.

The Purchaser shall redeliver to the Vendor, vacant possession of the Properties in substantially the same state and condition as the date of delivery of possession save for fair wear and tear if vacant possession has been delivered to the Purchaser.

The Purchaser shall present or caused to be presented for registration the withdrawal of private caveat(s) and forward to the Vendor the presentation particulars of the same upon the withdrawal of the private caveat(s) if the Purchaser lodged any private caveat against the Properties.

Gearing before and after repayment of overdraft financing taken by Vertical Plus Sdn Bhd mentioned under item (8), interest savings and timeframe for utilization of proceeds

The gearing effect before and after repayment of overdraft financing taken by Vertical Plus Sdn Bhd are set out below:-

	Before Repayment (RM ‘000)	After Repayment (RM’000)
Group’s Total Debt	34,230,076	21,230,076
Group’s Total Equity	113,982,938	113,982,938
Gearing ratio (%)	30.0%	18.6%

Based on the prevailing profit rates incurred at 6.6% per annum, such repayment is expected to result in interest savings of approximately RM858,000 per annum in total.

The estimated timeframe for utilization of proceeds is within 1 month.