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1.1 The Board of Directors of RCE is pleased to announce that the Securities Commission ("SC") has approved the issuance of the Proposed MTN Facility by RCE's subsidiary, RCE Advance Sdn Bhd (formerly known as Perfect Aspiration Sdn Bhd) ("RCEA"), vide SC's approval letter dated 28 October 2005, which was received on 31 October 2005.

1.2 Amanah Short Deposits Berhad and Mulpha Capital Markets Sdn Bhd have been appointed by RCEA as the Lead Arranger and Financial Adviser respectively, for the Proposed MTN Facility.

2.1 Description

The issuance of up to RM420,000,000 Fixed Rate Medium Term Notes Facility consist of:-

(b) RM120,000,000 Class B Fixed Rate Medium Term Notes (Class B Notes); and
(c) RM60,000,000 Class C Fixed Rate Medium Term Notes (Class C Notes).

(Collectively referred to as the Notes).

Under the Proposed MTN Facility, RCEA may issue up to a maximum of six (6) tranches of RM70,000,000 each (Tranche(s)) with each respective tranche comprising the following:

2.2 Mode of Issue

(a) All Notes issued under Tranche A shall be issued at par.

(b) The Class A Notes and Class B Notes issued under all subsequent Tranches shall be issued at par, a premium or a discount to face value depending on the yield to maturity agreed between RCEA and the private placement investor(s) at the time of issuance of each Tranche and the Class C Notes issued under all subsequent Tranches shall be issued at par.

2.3 Coupon payment frequency
(a) Pursuant to each Tranche, the coupon payment under the Class A Notes and Class B Notes shall be payable semi-annually in arrears with the last coupon payment to be made on the last respective maturity date.

(b) The coupon payment under the Class C Notes shall be calculated annually but payment is deferred until all Class A Notes and Class B Notes have been fully redeemed. The entire deferred Class C Notes coupon payment will be paid in one lump sum.

2.4 Tenure
(a) The tenure of the Proposed MTN Facility is thirteen (13) years from the date of issuance of Tranche A.

(b) Each Tranche shall be sub-divided into various series which have tenures ranging from three (3) years to ten (10) years from the date of issuance.
2.5 Security

The Proposed MTN Facility is secured by the following:

(b) Assignment of the receivables that meet certain pre-determined criteria ("Identified Eligible Receivables) purchased by RCEA;

(d) Assignments by RCEA and RCEAs immediate holding company, RCE Marketing Sdn Bhd (RCEM") of certain agreements in relation to the Identified Eligible Receivables;

Within each Tranche, the holders of the Class A Notes shall rank first in terms of priority, the holders of the Class B Notes shall rank second in terms of priority and the holders of the Class C Notes shall rank last in terms of priority.

Notes	Credit Rating Assigned (Indicative)
Class A Notes	A+
Class B Notes	A
Class C Notes	BBB+


The Proposed MTN Facility is rated by Malaysian Rating Corporation Berhad.

The proceeds from the issuance of each Tranche of the Proposed MTN Facility shall be utilised by RCEA to purchase pools of Identified Eligible Receivables from RCEM and the balance of proceeds, if any, from the issuance of each Tranche, shall be advanced by RCEA to RCEM for its working capital purposes.

4.1 To enable RCEA to raise financing at a longer term with favourable or acceptable interest rates to finance the business needs of the Group due to the structure of the Proposed MTN Facility whereby the repayment of the Proposed MTN Facility is secured against the future collections of the Identified Eligible Receivables purchased by RCEA.

4.2 To avoid the dilutive effect on the future consolidated earnings of RCE which would arise from a fund raising exercise involving the issuance of new RCE shares.

5.1 Issued and paid-up share capital

The Proposed MTN Facility will not have any effect on the issued and paid-up share capital of RCE.

5.2 Net Tangible Assets ("NTA")

The Proposed MTN Facility is not expected to have any material effect on the NTA of RCE for the current financial year ending 31 March 2006.

5.3 Earnings

Save for the fees incidental to the Proposed MTN Facility, the Proposed MTN Facility is not expected to have any material effect on the earnings of RCE for the current financial year ending 31 March 2006.

However, taking into consideration the rationale for the Proposed MTN Facility, the Proposed MTN Facility is expected to contribute positively to the earnings of RCE in the longer term.

5.4 Substantial shareholding

The Proposed MTN Facility will not have any effect on the substantial shareholding structure of RCE.

The Board of Directors of the Company, having considered the rationale as indicated above as well as the terms and conditions of the Proposed MTN Facility, is of the opinion that the issuance of the Proposed MTN Facility by RCEA is in the best interest of the Company.

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