Pursuant to Paragraph 9.04(f) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad, the Board of Directors (“Board”) of AME Elite Consortium Berhad (“Company”) wishes to announce that AME Construction Sdn Bhd (“Plaintiff”), a wholly owned subsidiary of Amsun Industries Sdn Bhd which in turn is a wholly owned subsidiary of the Company, has on this day 6 November 2020 filed a Writ of Summons and Statement of Claim in the High Court of Malaya at Shah Alam, Selangor Darul Ehsan (“Civil Suit”) against Area Ventures Sdn Bhd (“Defendant”), via its solicitors Messrs Raja, Darryl & Loh pertaining to a project known as 

“Cadangan Membina Sebuah Pusat Gudang Logistik Yang Mengandungi: (i) 1 Blok Gudang 3 Tingkat Dengan Pejabat Di Tingkat Mezzanine Dan 1 Tingkat Sub-Basemen Gudang dan Tempat Letak Kereta, (ii) 2 Unit Pondok Pengawal, (iii) 1 Unit Pencawang Pembahagian Utama TNB Dan Bangunan-Bangunan Utiliti, (iv) 1 Unit Bangunan Pejabat Satelite Kastam, Di Atas Lot 7716 (PN 97879) Dan Lot 7717 (HSM 2601/PT 7666), Lorong Enggang, Hulu Kelang FTZ, Seksyen 2, Bandar Hulu Kelang, Daerah Gombak, Selangor Darul Ehsan, Untuk Tetuan Area Ventures Sdn Bhd” (“Project”)

where the Plaintiff was engaged by the Defendant, via inter alia a principal letter of award dated 1 August 2016, as its main contractor to carry out the construction works for the project. The said principal letter of award has incorporated various documents all of which taken together formed the contract between the parties (“Contract”).

1. CIRCUMSTANCES LEADING TO THE COMMENCEMENT OF THE CIVIL SUIT

The Plaintiff had completed all the works under the Contract and the Certificate of Practical Completion was obtained on 17 November 2019. The defects liability period will therefore expire on 16 November 2020. However, the Defendant failed to pay the Plaintiff for part of the works properly done and completed under the Contract.

To resolve the overdue payment for the debt owing to the Plaintiff by the Defendant, the parties agreed to a settlement by way of a letter dated 19 June 2020 (“Settlement Letter”) from the Defendant to the Plaintiff.

The Defendant has failed to honour its payment obligations under the Settlement Letter by failing to pay the Plaintiff a substantial amount due under the Settlement Letter by 30 September 2020. In view of the current default by the Defendant, it is anticipated that the Defendant may default in the subsequent payment obligation as well.

2. PARTICULARS OF CLAIM

The Plaintiff is claiming against the Defendant for the following:

(A) the sum of RM24,700,143.13;

(B) the sum of RM4,878,971.01 if the Defendant fails to pay the same to the Plaintiff on 17 November 2020;

(C) Interest at the rate of 5% per annum on RM24,700,143.13 to be calculated from 1 October 2020 until full realisation and if prayer (B) is granted, interest at the rate of 5% per annum on RM4,878,971.01 to be calculated from 17 November 2020 until full realisation;

(D) Costs on indemnity basis to be paid by the Defendant to the Plaintiff; and

(E) Such further and/or other order or relief as the Honourable Court thinks fit to grant.

The Board of the Company is of the opinion that it is necessary for the Plaintiff to pursue the Civil Suit to best protect the interest of the Company. The Civil Suit is not expected to materially affect the operations of the Company.

Further announcement would be made should there be any material development on this matter.

This announcement is dated 6 November 2020.