TECNIC GROUP BERHAD (“COMPANY”)

MEMORANDUM OF UNDERSTANDING

1. INTRODUCTION

We refer to the Company’s announcements dated 9 April 2015, 13 May 2015, 1 June 2015, 1 July
2015, 3 August 2015 and 1 September 2015 pursuant to Paragraph 8.03A of the Main Market
Listing Requirements of Bursa Malaysia Securities Berhad (“Bursa Securities”) (“Listing
Requirements”) and the Company’s announcements dated 14 July 2015, 3 August 2015 and 1
September 2015 pursuant to Practice Note 16 of the Listing Requirements.

On behalf of the Board of Directors of the Company (“Purchaser”) (“Board”), RHB Investment
Bank Berhad (“RHB Investment Bank”) wishes to announce that the Company has on 21
September 2015 entered into a non-binding Memorandum of Understanding (“MOU”) with Rohas-
Euco Holdings Sdn Bhd (“Vendor”) in relation to a proposed reverse take-over of the Company
by the Vendor, which entails the Company acquiring all the equity interest held by the Vendor in
Rohas-Euco Industries Berhad (“REI”) comprising of 68,377,306 ordinary shares of RM1.00 each
(“Sale Shares”) (“Proposed Acquisition”) for RM200,000,000 ("Purchase Consideration").

The Company and the Vendor are referred to each as the “Party” and collectively referred to as
the “Parties”.

2. SALIENT TERMS OF THE MOU

2.1 Negotiation and execution of Definitive Agreement and exclusivity

2.1.1 The Parties have agreed to negotiate exclusively in good faith the detailed terms
and conditions of the Proposed Acquisition with the intention to finalise and enter
into a sale and purchase agreement (“Definitive Agreement”) within two (2)
months from the date of the MOU (“Due Diligence Completion Date”) with an
automatic extension of one (1) month thereafter or such other period as the
parties may mutually agree upon (“Expiry Date”), in accordance with the terms of
the MOU.

2.1.2 The Parties agree that they will not, and will ensure that their related corporations
will not, directly or indirectly, initiate, solicit or entertain any discussion,
negotiation, agreement or arrangement or otherwise deal in any way with any
other person other than the other Party in connection with the Proposed
Acquisition at any time prior to the Expiry Date.

2.2 Due Diligence inquiry

2.2.1 The Company shall after the date of the MOU embark on a due diligence inquiry
on REI and its subsidiaries (collectively, “REI Group”) and complete the due
diligence inquiry by the Due Diligence Completion Date.

2.2.2 The Vendor shall after the date of the MOU embark on a due diligence inquiry on
the Company and its subsidiaries and complete the due diligence inquiry by the
Due Diligence Completion Date.

1
2.3 Duration of the MOU

2.3.1 The MOU shall terminate and shall cease to take effect on the earliest of the
following events:

(a) in the event that the Company and the Vendor do not enter into the
Definitive Agreement together with such other agreements as the Parties
may agree upon by the Expiry Date; or

(b) the MOU is terminated by a Party in accordance with the provisions of

the MOU if, amongst others, either Party is not satisfied with the results
of the due diligence inquiry as stated in paragraph 2.2 above; or

(c) upon the execution of the Definitive Agreement.

2.4 Salient terms of the Definitive Agreement

2.4.1 Purchase Consideration

The Purchase Consideration shall be satisfied by the issuance of 317,460,317

new ordinary shares of RM0.10 each in the Company (“Consideration Shares”)
to the Vendor at an issue price of RM0.63 each.

2.4.2 Conditions Precedent

The completion of the Proposed Acquisition is subject to the following conditions

precedent (“Conditions Precedent”) and such other conditions precedent as
stipulated in the Definitive Agreement being obtained/fulfilled within such period
as shall be agreed upon by the Parties and stipulated in the Definitive
Agreement:

(i) the approval of Securities Commission Malaysia for the Company’s

proposed regularisation plan by virtue of it being an affected listed issuer
and a Cash Company pursuant to Paragraphs 8.03A and 8.03(1) of the
Listing Requirements respectively (“Proposed Regularisation Plan”),
which includes, amongst others, the following proposals –

(a) the sale by the Vendor to the Company, and the purchase by the
Company from the Vendor, of the Sale Shares in accordance with
the terms of the MOU and the Definitive Agreement;

(b) the issuance and allotment of the Consideration Shares to the

Vendor or its nominee(s); and

(c) the change in business direction of the Company upon the

completion of the Proposed Acquisition;

(ii) the approval of Bursa Securities for the listing of and quotation for the
Consideration Shares pursuant to the Proposed Regularisation Plan;

(iii) the approval of the shareholders of the Company in an extraordinary

general meeting of the Purchaser to be convened for the Proposed
Regularisation Plan, including the issuance of the Consideration Shares
to the Vendor or its nominee(s);

2
 (iv) the approval of the financiers of the Vendor in respect of the sale and
transfer of the Sale Shares pursuant to the Proposed Acquisition (where
required);

(v) the Company being satisfied with the results of the due diligence inquiry
conducted on REI Group;

(vi) the Vendor being satisfied with the results of the due diligence inquiry
conducted on the Company and its subsidiaries;

(vii) the approval of the Ministry of International Trade and Industry (MITI)
through the Malaysian Investment Development Authority (MIDA) in
connection with the Proposed Acquisition and the change of control in
REI (where required); and

(viii) the approval or consent of such other relevant authority or person as may
be required by law or deemed necessary by the Parties.

3. INFORMATION ON REI

REI was incorporated as a private limited company under the name of Euco Iron Limited on 13
March 1961 under Section 15(1) of the Companies Ordinances, 1940 and was subsequently
listed on the Second Board of Bursa Securities (now known as Main Market of Bursa Securities)
on 16 March 1995. REI was transferred to the Main Board of Bursa Securities (now known as
Main Market of Bursa Securities) on 19 November 2001. The entire issued and paid-up share
capital of REI was removed from the Official List of Bursa Securities on 6 February 2008 following
the privatisation of REI.

REI is principally involved in the design and fabrication of steel structures for high-tension
transmission towers, microwave towers and substation structures and provision of other
fabrication and installation works.

4. RATIONALE OF THE MOU

The MOU allows the Parties to set out the understanding and intention in respect of the Proposed
Acquisition. The Proposed Acquisition is part of the Company’s Proposed Regularisation Plan to
maintain its listing status on the Main Market of Bursa Securities.

5. EFFECTS OF THE MOU

The MOU will not have any effect on the earnings per share, net assets per share, gearing, share
capital and substantial shareholders’ shareholding of the Company for the financial year ending
31 December 2015.

6. DIRECTORS’ AND MAJOR SHAREHOLDERS’ INTEREST

None of the Directors and/or major shareholders of the Company and/or persons connected with
them have any interest, direct or indirect, in the MOU.

3
7. ADVISER

RHB Investment Bank has been appointed as the Adviser to the Company for the Proposed
Acquisition.

8. APPROVALS REQUIRED

The MOU is not subject to the approval of the shareholders of the Company or any regulatory
authorities.

9. DIRECTORS’ OPINION

The Board, having taken into consideration all aspects of the MOU, is of the opinion that the MOU
is in the best interest of the Company.

10. DOCUMENT AVAILABLE FOR INSPECTION

The MOU is available for inspection at the registered office of the Company, following the date of
this announcement for a period of three (3) months from Monday to Friday (except public
holidays) during normal business hours.

A detailed announcement on the Proposed Acquisition will be made upon the execution of the Definitive
Agreement.

This announcement is dated 21 September 2015.