Contents :
1.
Joint Venture
Kossan Rubber Industries Bhd ("KRI" or "the Company") writes to inform that Ideal Quality Sdn
Bhd("IQ"), a wholly-owned subsidiary of the Company, had entered into a joint venture agreement
("JVA") dated 9 September with Robert C.Mattice and Jessica T. Mattice ("RJM") for the purpose
of venturing into direct marketing of rubber products, in particular the sales and distribution of
gloves for medical and general use in the US via a joint-venture company known as
Normandin Pacific Holdings Corporation ("Joint-Venture").
IQ's proposed equity in NPHC shall be 51% of the eventual paid-up capital while RJM will be
49%. The proposed authorised capital shall be USD1 million comprising one million
common stock of USD1.00 each and the eventual paid-up capital of NPHC shall be
USD16,326 comprising 16,326 common stock of USD1.00 each. IQ's subscription for the
new shares will be funded by export of goods to NPHC to a total value of USD400,000
(RM1,520,000) at the conversion rate of USD1.00 = RM3.80.
2.
Information on NPHC
NPHC, was incorporated in the States of California, USA on 17 January 1992 under the name
of Normandin Pacific Holdings Corporation.
The current authorised capital is USD1 million comprising 1 million common stock of
USD1.00 each and the paid-up share capital is USD8000 comprising 8000 common stock
of USD1.00 each fully paid-up.
3.
Salient Terms of the JVA
3.1 The Board of Directors ("BOD") of NPHC shall comprise 1 representative of KRI and
two representatives from RJM.
3.2 In the first 2 years should IQ wishes to sell, transfer or dispose of all the 51% of its shares,
they shall give to the other shareholder the right of first refusal to purchase the shares
at a mutually agreed price, failing agreement , at a price determined by an
independent accounting firm.
3.3 NPHC will develop and expand the marketing of gloves and rubber products in the
United States under the proprietary brand name "PACIFICA" and such other brand names
that may be developed from time to time.
4.
Rationale for the Joint Venture
The Company intends to develop and expand its export business through direct distribution
of gloves to end users.
5.
Effects of the Joint Venture
5.1
Share capital and substantial shareholding
The Joint Venture will not have any effect on the share capital and substantial shareholding of KRI.
5.2
Earnings and net tangible assets
The Joint Venture is not expected to have any impact on the earnings per share and the net
tangible assets of the KRI group for the financial year ending 31 Dec 1999. However, the Board
of KRI expects the JVA should contribute positively to the future earnings of the KRI group.
6.
Directors' and Substantial Shareholders' Interests
None of the Directors, substantial shareholders and persons connected to the Directors
and substantial shareholders of the Company have any interest, direct or indirect, in the
Joint Venture.
7.
Conditions of the Joint Venture
The Joint Venture is not subject to the approval of the shareholders of KRI. Permission to
remit funds overseas has been obtained from Bank Negara Malaysia on 19 July 1999.
8.
Documents Available for Inspection
A copy of the JVA is available for inspection at the Registered Office of IQ at 82F Jalan Pulasan,
41000 Klang during normal office hours from Mondays to Fridays (except public holidays) within
14 days from the date of this announcement.
This announcement is dated 9 September 1999.