Document:

Exhibit 10.2

 

 

11 DEC 2012

 

DATED THIS DAY OF 2012

 

 

BETWEEN

 

HONG LEONG BANK BERHAD 

(Company No. 97141-X)

["The Lender"]

 

 

 

 

 

 

AND

 

 

 

 

PGCG ASSETS HOLDINGS SDN. BHD. 

(Company No. 983271-U)

["The Borrower"]

 

 

 

 

 

 

*****************************************

 

 

 

FACILITIES AGREEMENT

 

 

*****************************************

 

 

MESSRS. GHANI & CO. Advocates & Solicitors

2nd Floor, Wisma Hamzah-Kwong Hlng

No. 1 Leboh Ampang

50100 Kuala Lumpur

Tel: 03-2070 4163

Fax: 03-2070 1797 & 03-2078 8180

[Ref: AG/WVL/39874/12/HLBB-JP/PAHSB]

 

 

 

    	 

    	 	

    
 

FACILITIES AGREEMENT

 

 

THIS AGREEMENT is made the day and year set out in Section l of
the First Schedule hereto Between HONG LEONG BANK BERHAD (Company No. 97141-X), a licensed banking and finance company incorporated
in Malaysia and having its registered office at Level 8, Wisma Hong Leong, No. 18 Jalan Perak, 50450 Kuala Lumpur (hereinafter
called "the Lender");

 

And

 

The person(s) described in Section 2 of the First Schedule hereto
(hereinafter called "the Borrower(s)").

 

ARTICLE I

 

RECITALS

 

SECTION 1.01 APPLICATION FOR FACILITIES

 

At the request of the Borrower(s), the Lender has granted and made
available and/or continue to grant and make available to the Borrower(s) such banking facilities and/or credit facilities and/or
any accommodation now or hereafter or from time to time as the Lender may in its absolute discretion grant as stipulated in the
Letters of Offer issued by the Lender and accepted by the Borrower(s) from time to time upon the terms and subject to the conditions
contained in the Letters of Offer and hereinafter appearing and in such manner as the Lender may deem fit.

 

 

ARTICLE II

 

DEFINITIONS AND INTERPRETATIONS

 

SECTION 2.01 DEFINITIONS

 

In this Agreement unless the context otherwise requires the following
words and expressions shall have the following meanings:-

 

	WORDS	MEANINGS
	 	 
	"Accessory Parcel"	The term accessory parcel shall have the meaning assigned to it by the Strata Titles Act, 1985, the Strata Titles Ordinance 1995 and the Land (Subsidiary Title) Enactment 1972 and includes any statutory amendment or re-enactment thereof;
	 	 
	"Acts"	The National Land Code 1965 (Act 56 of 1965) of Peninsular Malaysia, Sarawak Land Code (Cap. 81) and Sabah Land Ordinance (Cap. 68) the Land (Subsidiary Title) Enactment 1972, the Strata Titles Act 1985 and the Strata Titles Ordinance 1995 and includes any statutory amendment or re-enactment thereof;
	 	 
	"Advance" or "Advances"	As the context requires an advance/advances (as from time to time reduced by repayment) made or to be made by the Lender to the Borrower(s) under the terms of this Agreement;
	 	 
	''Assignment"	The assignment executed by the Assignor(s) in favour of the Lender pursuant to Section 9.01(a)(i) hereof;

 

*Delete
whichever if not applicable.

 

    	1

    	 

    
 

	"Assignor(s)"	The person(s) described as the "Assignor(s)" or the "Chargor(s)" in the First Schedule of the Assignment or the Charge, as the case maybe, and includes his person! representatives, successors-in-title .and permitted assigns .and where the individual title to the Said Property has been issued, references to the Assignor(s) in this Agreement shall be read as if they were references to the Chargor(s);
	 	 
	"Base Lending Rate"	The rate of interest pet annum which is from time to time quoted by the Lender as its Base Lending Rate;
	 	 
	"Building"	the building or buildings to be erected or constructed on the Said Property more particularly described in the Construction Agreement;
	 	 
	"Business Day"	A day on which financial institutions are open for business in West Malaysia, Sarawak or Sabah as the case may be and on which transactions of the nature required by this Agreement are carded out;
	 	 
	"Borrower(s)"	The person(s) described in Section 2 of the First Schedule hereto and includes his/her/their/its personal representative, successors-in-title and permitted assigns;
	 	 
	"Charge"	The legal charge to be executed by the Assignor(s) in favour of the Lender pursuant to Section 9.01(a)(ii) or (b) hereof;
	 	 
	
        "Commission/Discount Rate

        / Other Banking Charges
	The rate(s) as stated in the relevant Letters of Offer and shall include any and such other rate as the Lender may at any time or from time to time stipulate at its discretion;
	 	 
	"Construction Agreement"	the agreement between the Assignor(s) and the Contractor whereby the Contractor agreed to construct or renovate the Building for the Assignor(s) for the Construction Price and upon the terms and conditions set out in the agreement;
	 	 
	"Construction Price"	the total price for the construction or renovation of the Building more particularly set out in the Construction Agreement;
	 	 
	"Contractor"	The party appointed or to be appointed by the Assignor(s) to carry out the construction or renovation of the Building and set out in the Construction Agreement;
	 	 
	"Default Rate"	The rate(s) specified in Section 4.02(a) (b) and (c) of this Agreement and includes where and when applicable such other rate which the Lender may at any time or from time to time stipulate at its discretion;
	 	 
	"Developer/Vendor"	The party(ies) described in the Principal Sale and Purchase Agreement or the Sale and Purchase Agreement as the developer or vendor, as the case may be, and/or as defined in the Assignment and includes its successors-in title and permitted assigns;
	 	 
	"Events of Default"	Any of the events or state of affairs specified in Section 12.01 herein or any other event rendering the Indebtedness under or pursuant to this Agreement immediately due and payable to the Lender;
	 	 
	"ECOF"	The inter-bank offer rate for the relevant interest period duly adjusted for the cost of maintaining statutory reserves, liquidity and other statutory requirements of the Lender;

 

    	2

    	 

    
 

	"Guarantor(s)"	The person(s) described in the relevant Letters of Offer and includes (if any) his/her/their/its successors-in-title, permitted assigns and personal representative;
	 	 
	"Indebtedness"	The aggregate of all monies whether principal, interest, capitalised interest, additional and/or penalty interest, fees, costs, charges, commissions or otherwise outstanding . or payable or agreed to be payable by the Borrower(s) and the Security Parties to the Lender from time to time, whether solely or jointly with any other person and whether as principal or surety and includes all liabilities and obligations whether present or future or actual or contingent for the repayment and payment of all monies by the Borrower(s) and the Security Parties in respect of or arising from the Facilities and the Security Documents including monies referred in Sections
	16.47 and 16.49 hereof;	 
	 	 
	"Instalments"	All instalments in respect of each Term Loan. In relation to each Term Loan, the sum of money stated in the relevant Letters of Offer as the monthly instalment in respect of the principal amount and the amount as determined by the Lender to be the amount of interest chargeable for the corresponding period and payable· by the Borrower(s) in accordance with the terms of the relevant Letters of Offer and this Agreement;
	 	 
	"Letters of Offer"	The letters of offer issued or to be issued by the Lender and accepted by the Borrower(s) where the Lender agrees to grant or make available and the Borrower(s) agree(s) to accept each of the Facilities and includes any amendments and supplementals thereto and without limiting the generality of the foregoing, includes the letter of offer set out in Section 3 of the First Schedule hereto and any subsequent letter(s) of offer and the term "Letter of Offer" shall refer to any one of the Letters of Offer;
	 	 
	"Lender"	HONG LEONG BANK BERHAD (Company No. 97141-X), a company incorporated in Malaysia and includes persons deriving title thereunder and its successors-in-title and assigns and shall include any branch office of the Lender;
	 	 
	"Management Corporation"	The management corporation established under the applicable Acts in relation to the building in which the Said Property is comprised;
	 	 
	"Management Fund"	The management fund as defined in the applicable Acts;
	 	 
	"Month"	A calendar month;
	 	 
	"Overdraft"	All Overdraft facility or facilities agreed to be granted and/or granted and made available and/or continue to be made available by the Lender to the Borrower(s) now, or hereafter or from time to time in accordance with the terms and conditions set out in the relevant Letters of Offer and this Agreement and includes any balance or part thereof and all monies referred to in Section 16.47 and 16.49 hereof;
	 	 
	"Power of Attorney"	The power(s) of attorney executed by the Assignor(s) appointing the Lender as the Attorney and more particularly described in Section 9.02 herein;
	 	 
	"Progressive Releases"	The progressive disbursement (where applicable) of the Facilities or any part thereof by the Lender to the Developer/Vendor or any other third party(ies) in accordance with the Schedule of Payment in the Sale and Purchase Agreement or such variation in the order of the said Schedule of Payment as the Lender may in its absolute discretion deem .fit and against architect certificates so issued by the Developer's architect subject to, if the Lender so deems fit, the confirmation or certification of the same by the Lender's architect at the expense and on the account of the Borrower(s);

 

 

    	3

    	 

    
 

	"Prescribed Rate"	The respective interest rate(s) applicable to the Facilities as stated in each
    Letter .of Offer which expression shall wherever the context so permits include any and such other rate which the Lender may
    at any time or from time to rime stipulate at its discretion;
	 	 
	"Proprietor"	The party(ies) described in the Principal Sale and Purchase Agreement or the Sale and Purchase Agreement, as the case may be, and/or as defined in the Assignment and includes its successors-in-title and permitted assigns;
	 	 
	
        "Principal Sales & Purchase Agreement"

        (where applicable)
	The sale and purchase agreement (which expression shall where the context so permits include any agreement for the purchase of any accessory parcel) of the date stated in the Assignment entered into between the Original Purchaser (as defined in the Assignment) and the Developer and (if applicable) the Proprietor wherein the Developer agreed to sell and the Original Purchaser agreed to purchase the said Property upon the terms and conditions therein contained;
	 	 
	"Sale and Purchase Agreement"	The sale and purchase agreement (which expression shall where the context so permits include any agreement for the purchase of any accessory parcel) of the date stated in the Assignment made between the Assignor(s) and the Developer/Vendor and (if applicable) the Proprietor wherein the Developer/Vendor agreed to sell and the Assignor(s) agreed to purchase the Said Property upon the terms and conditions contained therein. In the case where the Assignor(s) is not the first purchaser, the full particulars of all sales, sub-sales assignments and reassignments up to the one between the Assignor(s) and the Vendor are described in the Assignment;
	 	 
	"Said Land"	That/those piece(s) of land more particularly described in the First Schedule of the Assignment;
	 	 
	"Said Property"	The property and/or properties described in the relevant Letters of Offer and in the Charge and/or the Assignment, as the case may be, from time to time which expression shall where the context so permits, include the meaning assigned to the term "parcel" under the applicable Acts and any statutory amendment or re-enactment thereof and wherever the context permits shall include the Accessory Parcel appurtenant to each property and any building(s) and fixture(s) now or hereafter or from time to time erected thereon or affixed thereto or any part or portion thereof;
	 	 
	"Security Documents"	The Letters of Offer, this Agreement, and if applicable, the Assignment, the Charge, the Power of Attorney, the Guarantee and any other security documents which the Lender may now and from time to time require to secure the repayment and payment of the Indebtedness;
	 	 
	"Security Parties"	The parties executing the Security Documents and includes any party or parties providing or which shall hereafter from time to time provide any security to the Lender to secure the repayment and payment of the Indebtedness or any part thereof;
	 	 
	"Term Loan"	All the term loan or loans if more than one term loan agreed to be granted and/or granted and made available and/or continue to be made available to or for the benefit of the Borrower(s) now or hereafter or from time to time in accordance with the terms and conditions set out in the relevant Letters of Offer and this Agreement and includes any balance or part thereof and all monies referred in Sections 16.47 and 16.49 hereof;
		 
	"Trade Facilities"	All the trade facility or facilities agreed to be granted and/or granted and made available and/or continue to be made available by the Lender to the Borrower(s) now or hereafter or from time to time in accordance with the terms and conditions set out in the relevant Letters of Offer, this Agreement and the Fourth Schedule hereto which are applicable to the Facilities comprised therein and includes any balance or part thereof and all monies referred to in Sections 16.47 and 16.49 hereof;

 

    	4

    	 

    
 

	"Year"	A 365-day year.

 

SECTION 2.02       INTERPRETATIONS

 

In this Agreement unless there is something in the subject or context
inconsisi.ini with such construction or unless it is otherwise provided:-

 

	(a)		words importing the masculine gender include the feminine and neuter genders and vice
versa;

 

	(b)		words importing the singular number· include the plural number and vice versa;

 

	(c)		references to Articles and Sections are to be construed as references to Articles
and Sections of this Agreement;

 

	(d)		the headings and sub-headings to the Articles and Sections of this Agreement are inserted
for purposes of convenience only and shall not be deemed to be a part hereof or be taken into consideration in the interpretation
or construction of this Agreement;

 

	(e)		where there are two (2) or more persons or parties included or comprised in the expression
the Borrower(s), all agreements, covenants, terms, stipulations and undertakings expressed to be made by and on the part of the
Borrower(s) shall he deemed to be made by or binding upon such persons or parties jointly and severally;

 

	(f)		any reference to the provisions of any legislation includes any statutory modification
or re-enactment thereof;

 

	(g)		any liberty or power which may be exercised or any determination which may be made
hereunder by the Lender may be exercised or made at the Lender's absolute or unfettered discretion and the Lender shall not be
under any obligation to give any reason therefore to the Borrower(s);

 

	(h)		words applicable to natural persons include any body, persons, company, corporation,
firms or partnerships corporate or otherwise and vice versa;

 

	(i)		the word "herein", hereinafter", "hereinbefore'', "hereof',
"hereunder" and other words of similar import shall refer to this Agreement as a whole and not to any particular provision;

 

	(j)		the words "monies", "Ringgit", "dollar" and the symbol
"RM" shall be construed as Malaysian currency;

 

	(k)		the Schedules hereto shall form an integral part of this Agreement and shall be taken,
read and construed as an essential part hereof;

 

	(i)		any reference to "this Agreement" shall include all amendments, additions
or supplementary agreements made hereafter or from time to time between the Lender and the Borrower(s);

 

	(m)		all provisions and references herein to the "Said Property", "the Charge"
and "the Assignment" shall not be applicable if the Facilities are not secured against titled or untitled property;

 

	(n)		where at any time an Overdraft facility, a Term Loan and/or the Trade Facilities or
any combination thereof has/have been granted or made available to the Borrower(s), all references to the Facilities shall apply
to the relevant facilities granted and all references to the Overdraft Term Loan or Trade Facilities, as the case may be, which
were not granted, shall be ignored.

 

 

    	5

    	 

    
 

ARTICLE III

 

REPRESENTATIONS AND WARRANTIES

 

SECTION 3.01       REPRESENTATIONS
AND WARRANTIES

 

The Borrower(s) hereby represent(s) and warrant(s) to the Lender
as follows:-

 

	(a)		that the Security Documents constitute the legal, valid and binding obligations of
the Security Parties in accordance with the terms and conditions thereunder;

 

	(b)		that the execution; delivery and performance of the Security Documents by the Security
Parties:-

 

	(i)		will not violate the provisions of any law or regulation or any order or decree of
any governmental authority, agency or Court to which the Security Parties' are subject;

 

	(ii)		will not violate the provisions of any mortgage, contract or other undertaking or
instrument to which the Security Parties are party or which is binding upon the Security Parties;

 

	(iii)		will not result in the creation or. imposition of any obligation to create or impose
any mortgage, lien, pledge or charge on any of the Security Parties' assets or revenues pursuant to the provisions of any such
mortgage contract or other undertaking or instrument;

 

	(c)		that all consents, approvals or authorisations of any relevant authority which are
required on the part of the Security Parties or which are advisable for or in connection with the execution, delivery, performance,
legality and enforceability of the Security Documents have been obtained and are in full force and any conditions contained therein
or otherwise applying thereto have been complied with;·

 

	(d)		that the Security Parties are not in default under any agreement to which the Security
Parties or any one of them is/are a party or by which the Security Parties or any one of them may be bound and no prosecution,
litigation, arbitration or administrative proceedings are presently current or pending or threatened which prosecution, default
litigation arbitration or administrative proceedings as the case may be might materially affect the solvency of the Security Parties
and might impair the Security Parties' ability to perform the Security Parties' obligations under the Security Documents;

 

	(e)		that the Borrower(s) and the other Security Parties have the full and absolute power,
right and authority to execute this Agreement and the other Security Documents and that there is and shall be no person or party
having priority over the Lender in respect of the Said Property and/or the Security Documents, save and except as the Lender may
agree in writing in its absolute discretion;

 

	(f)		if the Borrower(s) or any of the other Security Parties is/are a corporation:-

 

	(i)		the Borrower(s) and/or the other Security Parties are duly incorporated under the
relevant law;

 

	(ii)		all requisite corporate shareholders or other approvals for the execution of this
Agreement and/or the other Security Documents have been obtained;

 

	(iii)		the Borrower(s) and/or the other Security Parties are empowered to execute this Agreement
and/or the other Security Documents under their respective constitutive document;

 

	(g)		that all the particulars and declarations furnished, provided or made by the Borrower(s)
and/or the other Security Parties in respect of the Borrower(s)' application for the Facilities are true, accurate and correct
in all respects;

 

	(h)		that there is no default by any of the relevant parties of any of the terms of the
Sale and Purchase Agreement or the Principal Sale and Purchase Agreement or the Construction Agreement, as the case may be; and

 

	(i)		such other representations and warranties as are set out in the relevant Letters of
Offer shall be binding on the Borrower(s).

 

 

    	6

    	 

    
 

SECTION 3.02       TRUTH
AND CORRECTNESS OF REPRESENTATIONS AND WARRANTIES

 

	(a)		The Borrower(s) acknowledge(s)"that the Lender has accepted this Agreement on
the basis of, and in full reliance upon, the aforesaid representations and warranties, which will be correct and complied with
in all material respects so long as this Agreement shall remain in force and each of the above representations and warranties
will \Je correct and complied with in all material respects so long as the Facilities shall remain available and until the Indebtedness
due hereunder and under the Security Documents have been discharged.

 

	(b)		The truth and correctness of all the matters stated in the representations and warranties
under Section 3.01 hereof shall form the basis of the Lender's commitment to make available or continue to make available the
Facilities to the Borrower(s). If any such representations and/or warranties made shall at any time hereafter be found to have
been incorrect in any material respect then and in such event and notwithstanding anything to the contrary hereunder the Lender
shall have the right at its absolute discretion to review, suspend, recall or terminate the Facilities or any part thereof.

 

SECTION 3.03       PURPOSE
OF THE FACILITIES

 

	(a)		The Facilities shall be utilised by the Borrower(s) for the respective purposes set
out in the Letters of Offer. If the Borrower(s) shall require the utilisation of the Facilities or any part thereof for any other
purpose the Borrower(s) shall obtain the prior written consent of the Lender which consent may be withheld, refused or given unconditionally
or subject to such terms and conditions as the Lender shall deem fit.

 

	(b)		Without prejudice to the obligations of the Borrower(s) under Section 3.03(a), the
Lender shall not be obliged to concern itself with the application by the Borrower(s) of the Facilities.

 

ARTICLE IV 

 

COVENANT TO PAY

 

SECTION 4.01

 

(A) COVENANT TO PAY THE OVERDRAFT AND/OR TRADE FACILITIES

 

In consideration of the Lender having agreed at the request of the
Borrower(s) to grant and make available and continue to grant and make available the Overdraft and/or the Trade Facilities (where
applicable) to the Borrower(s), the Borrower(s) hereby AGREE(S), COVENANT(S) AND UNDERTAKE(S):-

 

	(a)		to repay to the Lender ON DEMAND all sums of money which are now or shall from time
to time or at any time hereafter be due or owing by the Borrower(s) solely or jointly with any other persons firms or companies
and whether as principal or surety or which the Borrower(s) may be or become liable to the Lender any where on banking account
or accounts current or otherwise or in any . manner whatsoever including the balance for the time being owing for or in respect
of cheques bills notes drafts or other negotiable instruments accepted paid or discounted for and on behalf of the Borrower(s)
either alone or jointly with another or others or for any payments loans credits or advances made to or for the use or accommodation
or on behalf of the Borrower(s) either alone or jointly with another or others pursuant to or in respect of or under any guarantee
or letter of credit given established or opened by the Lender for the Borrower(s) or any contracts for the forward delivery of
goods bills or specie or in respect of any other banking facilities whatsoever whether or not given upon or under any trust receipts
or other security whatsoever or otherwise howsoever up to such aggregate sum as the ad valorem stamp duty paid on the original
of this Agreement and/or any supplements thereto together with interest thereon at the applicable Prescribed Rate or as the case
may be at the applicable Default Rate, Commission, Discount Rate and other Banking Charges and all costs charges and other expenses
which the Lender may charge in respect of any of the matters aforesaid or which the Lender may pay or incur in perfecting the
securities or in enforcing or obtaining payment of such moneys or in paying any expenses or outgoings whatsoever in respect of
or in insuring repairing maintaining managing or realising the Said Property and or any buildings fixtures crops or plants thereon
or in defending prosecuting or otherwise howsoever taking part in or attending at (whether on a watching brief as observer or
otherwise howsoever) any action enquiry hearing suit or other proceedings whatsoever affecting the Said Property or any buildings
fixtures crops or plants thereon and also all other payments and sums hereinafter mentioned or stipulated and other usual bankers'
charges;

 

 

    	7

    	 

    
 

	(b)		If and when the said account or accounts current or otherwise shall be closed either
by demand as aforesaid or by the death or winding up or other default as the case may be of the Borrower(s) and/or the Assignor(s)
(or where the Borrower(s) and/or the Assignor(s) shall be more than one· person by the death .or winding up or other default
as the case may be of any of them) a balance shall be owing to the Lender by the Borrower(s) or the personal representative or
liquidators of the Borrower(s) as the case may be will so long as the same or any part thereof shall remain owing pay to the Lender
interest thereon at the applicable Default Rate (both before and after judgement and order) computed from the time when such balance
shall have been ascertained and the Borrower(s) agree(s) that the statement of the Manager, Assistant Manager or any other Officer
of the Lender or any solicitor or from of solicitors purporting to act for the Lender as to the amount of such balance shall be
final and conclusive evidence against the Borrower(s);

 

	(c)		to pay all such sums and monies as are or may become payable by the Borrower(s) under
this Agreement and in particular (but without limiting the generality of the foregoing) all the costs, charges, expenses, recoverables
and other sums and monies provided herein:

 

	(d)		It is hereby expressly agreed and declared by the Borrower(s) that in addition to
the terms and conditions herein, the Trade Facilities and Overdraft shall be subject to the additional terms and conditions set
out in the Fourth Schedule which are applicable to the facilities comprised therein.

 

	(B)		COVENANT TO PAY THE TERM LOAN

 

In consideration of the Lender having agreed at the request of the
Borrower(s) to grant and make available and continue to grant and make available the Term Loan to the Borrower(s), the Borrower(s)
hereby AGREE(S), COVENANT(S) AND UNDERTAKE(S):-

 

	(a)		to repay to the Lender ON DEMAND the Term Loan together with interest thereon at the
applicable Prescribed Rate or as the case may be at the applicable Default Rate (which rate shall be applicable before as well
as after any judgement or order obtained against the Borrower(s)) and all other monies owing or payable under the terms of this
Agreement

 

AND until demand as aforesaid the Borrower(s) will repay the Term
Loan and interest thereon at the applicable Prescribed Rate by way of the Instalments, the first of the Instalment to be paid on
the first (1st) day of the month following next after the date on which the full amount of the Term Loan shall have been advanced
or paid to or on behalf or for the benefit of the Bonower(s) and/or Assignor(s) or on the first day of such other month as the
Lender may stipulate in the relevant Letters of Offer and the subsequent Instalments to be paid at regular successive intervals
of one (1) month or such or other intervals stipulated by the Lender in the relevant Letters of Offer until the full amount of
the Term Loan and all interest thereon shall have been fully paid and satisfied PROVIDED ALWAYS that notwithstanding the provisions
relating to the schedule of Instalments under this Section, the Lender may in its absolute discretion at any time and from time
to time whether at the request of the Borrower(s) or otherwise be entitled (but not obligated) to accept payment of the monies
due or becoming due hereunder by such increased or reduced amount and/or number of Instalments as may be agreed or agree to suspend
payments thereof or give such further time or indulgence for payment but nothing contained in this Section or done hereunder shall
be construed as prejudicing or impairing the security hereunder or the Lender in the exercise of all, or any of the remedies available
to it hereunder on default by the Borrower(s).

 

	(b)		(i) In the case where the principal and interest payments on the Instalments are
aggregated

 

until such time as the Borrower(s) shall commence to make payment
of the Instalments the Borrower(s) will pay to the Lender interest at the applicable Prescribed Rate and/or the Default Rate as
the case may be (both before and after judgement or order) on daily rests on every sum advanced to or otherwise however payable
by the Borrower(s) under this Agreement (whether the same shall form part of the Term Loan or otherwise however) from the date
on which the sum in question shall first be advanced or paid out by the Lender. The said interest shall be payable monthly, or
at such other intervals as the Lender may stipulate, the first of which payments shall be made on the first day of every month
commencing in the month following next after the said date on which such sum shall first be advanced or paid out as aforesaid or
such other date as the Lender may from time to time stipulate;

 

    	8

    	 

    
 

		(ii) 	In the case where the Instalments on the Term Loan comprise of principal only and
interest is paid separately

 

the Borrower(s) shall pay to the Lender interest at the applicable
Prescribed Rate and/or the Default Rate as the case may be, (both before and after judgement. or order) on daily rests before full
drawdown, and upon full drawdown, on monthly rests or such other rest period as may be prescribed by the Lender on every sum advanced
to or otherwise however payable under this Agreement (whether the same shall form part of the Term Loan or otherwise however) from
the date on which the sum in question shall first be advanced or paid out by the Lender until the Term Loan has been repaid in
full. The said interest shall be calculated on the amount outstanding and shall be payable monthly or at such other intervals as
the Lender may stipulate, the first of which payments shall be made on the first day of every month commencing in the month following
next after the said date on which such sum shall first be advanced or paid out as aforesaid or such other date or intervals as
the Lender may from time to time stipulate;

 

	(c)		to pay all such sums and monies as are or may become payable by the Borrower(s) under
this Agreement and in particular (but without limiting the generality of the foregoing) all the costs, charges, expenses, recoverables
and other sums and monies provided herein.

 

AND NOTWITHSTANDING that the payments specified in this Section
4.01(B) may have been made as aforesaid the Tenn Loan and any monies payable by the Borrower(s) to the Lender under this Agreement
and interest thereon as herein provided shall continue to be due for all purposes ON DEMAND.

 

Notwithstanding that no full drawdown of the Term Loan has been
made, the Lender may by notice in writing to the Borrower(s) require the repayment of the Term Loan by Instalments.

 

SECTION 4.02       ADDITIONAL INTEREST/DEFAULT RATE

 

	(a)		In addition and without prejudice to the power rights and remedies herein conferred,
if the Borrower(s) shall draw in excess of the approved limit of the Overdraft or any approved sub-limit of the facilities comprised
therein or any subsequent revised limit or sub-limits of the Overdraft as notified by the Lender to the Borrower(s) from time
to time whether such excess shall arise as permitted from time to time by the Lender or by any debit to the account of the Borrower(s)
which the Lender is entitled to make, the Borrower(s) shall pay to the Lender additional interest at the rate of four per centrum
(4.0%) per annum above the Base Lending Rate or any other rate or sum that may be imposed by the Lender at any time at its absolute
discretion (both before and after judgement and order) as agreed liquidated damages on the amount in excess of the abovesaid applicable
limit or sub-limit or any other sum or moneys due and payable at that time calculated from the date of such drawing or utilisation
or default until the date of payment of the amount thereof without prior notice to the Borrower(s). All capitalised and accumulated
unpaid interest shall be taken into account for the purpose of ascertaining whether the approved limit or sub-limits, as the case
may be of the Overdraft has been exceeded or not under this sub-section. In the event of any excesses over the approved limit
of the Overdraft or any approved sub-limit of the facilities comprised therein, the Lender may at its absolute discretion reduce
the sub-limits of one or more of the facilities until the excess has been paid or repaid in full without affecting the Lender's
rights and remedies herein or under any of the Security Documents.

 

	(b)		In addition and without prejudice to Section 4.02(a) hereof, in the event of a demand
by the Lender pursuant to Section 4.01 hereof for payment of all principal moneys including capitalised interest under the Facilities
and all interest thereon and all other sums or monies (whether principal or interest) for the time being due and owing under the
Facilities or recall of the Facilities or any of the facilities comprised therein or a default in the payment of any moneys covenanted
to be paid, the Borrower(s) shall pay the Lender additional interest at the rate of one percentum (1%) above the Prescribed Rate
or any other rate or sum that may be imposed by the Lender at any time at its absolute discretion (both before and after judgement
or order) as agreed liquidated damages on the principal moneys including capitalised interest and all interest thereon and all
other smns or moneys (whether principal or interest) for the time being due and owing under the Facilities calculated from the
date of such demand pursuant to Section 4.01, default or recall as the case may be until the date of full payment thereof (both
before and after judgement or order).

 

 

    	9

    	 

    
 

	(c)		In addition and without prejudice to the powers, rights and remedies herein conferred
upon the Lender, if the Borrower(s) shall default in the payment on due date of any one or more of the instalments of the Term
Loan or interest and other monies herein covenanted to be paid under the Term Loan or in the event of demand by the Lender for
repayment of the Term Loan and interest thereon or other monies covenanted to be paid herein or recall of the Term Loan, the Borrower(s)
shall pay to the Lender additional interest at the rate of one percentum (1%) above the Prescribed Rate or such other rate or
sum as the Lender may stipulate as agreed liquidated damages on the Instalment or Instalments of the Term Loan and/or interest
and any other sums at that time due or in arrears calculated from the date of such default demand or recall as the case may be,
until the date of payment of the amount thereof (both before and after judgment or order). Notwithstanding the above, the Lender
may at its absolute discretion impose a minimum charge of such amount as the Lender may deem fit as late payment interest.

 

	(d)		Notwithstanding the provisions of subclauses (b) and (c) above, in the event of a
demand by the Lender or a default by the Borrower(s) as mentioned in subclauses (b) and (c) above, the Lender may at its absolute
discretion choose to vary the Prescribed Rate whether in addition to or instead of imposing additional interest at the Default
Rate. Such variation of the Prescribed Rate may at the Lender's discretion continue to be applicable notwithstanding that the
relevant default may be remedied.

 

SECTION 4.03       DEMANDS/NOTICES

 

	(a)		If and
when the Facilities, interest thereon
and all monies hereby covenanted to
be paid by
the Borrower(s) to the Lender shall
be demanded as aforesaid or
shall otherwise be required to be
settled, the monies
owing by the Borrower(s) to the
Lender shall be ascertained by the Lender
and when such monies shall be ascertained the Borrower(s) agree(s) that the statement
of the Manager, Assistant Manager or any other Officer of the Lender or by any solicitor or firm solicitors purporting to act
for the Lender as to the amount of the
monies in respect of the Facilities, interest
thereon and all monies due and
payable under this Agreement shall be final and conclusive.

	(b)		Any demand for payment of the monies intended
to be hereby secured may be made by a notice
in writing requiring payment within seven
(7) days from the date thereof or in such form
as may be prescribed by or
under the applicable Acts and may
be signed on behalf of the
Lender by any Manager, Assistant Manager or
any other Officer of the Lender or by any
solicitor or firm of solicitors purporting
to act for the Lender
and such notice shall be deemed to have been sufficiently served on the
Borrower(s) if it is left at
the usual or last known place of residence
or at the address herein-stated of the Borrower(s) or at
the usual or last known place of business
of the Borrower(s) or sent by registered letter or ordinary mail or by telex
or facsimile to any of such addresses or telex/facsimile numbers of the Borrower(s).
In the case of posting, the service
shall be deemed
to be made at the time when the registered
letter or ordinary mail would in the ordinary course of post be delivered (notwithstanding its subsequent return), in the case
of telex, the service shall be deemed to be made
immediately upon transmission thereof and
confirmed by answerback and in the case of facsimile, on production of a transmission
report by the machine from which the facsimile was sent.

	(c)		Any notice required or permitted
to be served by the Lender under or
pursuant to this Agreement may be served and shall
be deemed served in the like manner
as a notice demanding payment
as provided in Section 4.03(b) herein. In the case of notice issued by way
of advertisement, the Borrower(s) shall be deemed to have received such notice on the date of
the advertisement.

 

	(d) 	(i)	Any notice or communication from the Borrower(s)
to be given to the Lender may be sent by
personal despatch, courier or by registered or ordinary
mail to the lending branch of the
Lender and such notices or communications shall only
be received when acknowledged by the Lender.

 

	(ii)		The Lender shall be entitled to
rely upon and act on the instructions
of the Borrower(s), whether oral or written
and whether given by telephone, post, telex, cable, facsimile transmissions or other electronic means. Without prejudice to the
generality of the foregoing, the Lender shall
be entitled to rely and act on
any notice or instructions given whether based on
signatures which appear to the
Lender, by reference to the names
and signatures of such persons filed with the Lender to be the signatures of:-

 

    	10

    	 

    
 

	(i)		the Borrower(s); or

	(ii)		any of the persons authorised by the Borrower(s) to issue any notice or any instructions
whatsoever on behalf of the Borrower(s),

 

or otherwise, without enquiry on the part of the Lender as to the
identity of the person giving or purporting to give such notices or instructions or as to the authenticity of such notices or instructions
notwithstanding that it is subsequently shown that the same was not given by the Borrower(s). The Lender is entitled to treat all
such notices or instructions given, as binding upon the Borrower(s) .and the Lender shall be entitled (but not bound) to take such
steps in connection with or in reliance upon such communication and the risk of the instructions being given by unauthorised persons,
any misunderstanding or any error, loss or delay resulting from the use of telephone, postal services, telex or teletype machines,
cable devices, facsimile transmission, devices or electronic or other means are entirely the risk of the Borrower(s).

 

	(iii)		The Lender shall be under no duty to enquire into the genuineness or authenticity
of the communication given to the Lender by any of the forms of communication referred in subclause (d)(ii) above and the Lender's
rights under this Agreement shall not be affected by any misuse or unauthorised use of such communication. The Lender shall be
indemnified in full by the Borrower(s) against all loss, claims, demands, costs, damages, expenses and all other liabilities whatever
which it may incur in consequence of its accepting and acting on such communication.

 

ARTICLE V 

 

CONDITIONS PRECEDENT

 

SECTION 5.01       CONDITIONS PRECEDENT AS TO THE AVAILABILITY
OF THE FACILITIES

 

The obligations of the Lender to make the Facilities available for
disbursement and/or to permit its utilisation by the Borrower(s) is subject to the fulfillment in a manner satisfactory to the
Lender and its legal advisers, prior to the utilisation of the Facilities by the Borrower(s) of the following conditions:,

 

	(a)		the Security Documents referred to herein and/or which are required by the Lender
to be executed by the Security Parties have been duly executed, stamped and registered with such registries as the Lender may
deem necessary or expedient and copies thereof duly delivered to the Lender PROVIDED THAT the Lender may at its absolute discretion
disburse the Facilities or any part thereof upon presentation of the Security Documents at the relevant registries;

 

	(b)		a search having been made at the relevant land registry/land office confirming that
the Said Land and the Said Property are free from all encumbrances and no acquisition notices have been lodged and/or registered
or issued against the Said Land and the Said Property and the lodgment of a private caveat on the master title of the Said Property;

 

	(c)		the Lender is satisfied that the execution, delivery and performance of the Security
Documents have been duly authorised and approved by all necessary parties and that the same do not contravene any law, rules or
regulations or any contractual or other restrictions binding upon the Borrower(s) or the other Security Parties (if any);

 

	(d)		the receipt by the Lender of all relevant undertakings and confirmations required
by the Lender to the Lender's satisfaction;

 

	(e)		where the Facilities is to be disbursed by Progressive Releases, the receipt by the
Lender of the relevant architect certificates or invoices (in the case where the Lender is part financing the Construction Price);

 

	(f)		the Borrower(s) shall have delivered or caused to deliver to the Lender the current
receipts of quit rent, assessments, rates, dues and other outgoings thereto as the Lender may require;

 

	(g)		where required by the Lender, a valuation of the Said Property and verification of
the address the Said Property by a valuer appointed by the Lender at the cost and expense of the Borrower(s);

 

 

    	11

    	 

    
 

	(h)		receipt by the Lender of the original copy o(the Sale and Purchase Agreement and the
Principal Sale and Purchase Agreement (where applicable) and all other documents pertaining to the Said Property as the Lender
may require;

 

	(i)		where the Borrower(s) or any of the other Security Parties is/are a corporation, receipt
by the Lender of certified true copies of the Memorandum and Articles of Association and the Forms 24, 44 and 49 and the board
resolution authorising the execution of the Security Documents of each of the Security Parties;

 

	(j)		receipt by the Lender of all insurance policies required by the Lender to be taken
out;

 

	(k)		the difference between the purchase price under the Sale and Purchase Agreement and
the Overdraft and/or Term Loan has been fully settled;

 

	(i)		completion of all legal documentation to the satisfaction of the Lender mid upon the
Lender's solicitors' confirmation that it is in order to release the Facilities;

 

	(m)		a search having been made at the Official Assignee's/Receiver's office/Companies Commission
of Malaysia and a satisfactory report having been obtained on the Vendor/Developer/Registered Proprietor (as the case maybe),
the Borrower(s) and the other Security Parties;

 

	(n)		the Borrower(s) shall have complied with and satisfied to the Lender's satisfaction
all operational requirements relating to the operation of the Facilities as may be stipulated by the Lender from time to time;

 

	(o)		Where the Lender is part-financing the construction/renovation of the Building:-

 

	(i)		receipt of all relevant approvals from the relevant authorities in relation to the
construction of renovation of the Building including without limitation, the approvals for drawings, designs, specifications,
materials, earth work plans, building and layout plans have been obtained;

 

	(ii)		the receipt of the duly executed stamped original Construction Agreement confirming
the appointment of the Contractor and the Construction Price;

 

	(iii)		the difference between the Construction Price and the Facilities (or the part of the
Facilities granted to part-finance the construction/renovation of the Building) has been fully settled by the Borrower(s);

 

	(iv)		receipt of the letter of undertaking from the Contractor to the Lender to immediately
refund the Facilities (or the part of the Facilities granted to part-finance the construction/renovation of the Building) in the
event the Contractor breaches any term of the Construction Agreement or if the construction/renovation of the Building is abandoned
or not completed or if the Certificate of Fitness for occupation of the Building, if required, is not obtained;

 

	(p)		where the Lender is part-financing the premium for the mortgage reducing
term assurance, the balance of the premium required has been fully settled by the Borrower(s);

 

	(q)		payment of all fees, costs and charges (including processing fees, stamp duty, legal
and other professional fees and charges);

 

	(r)		there has been no material change in the circumstances of the Borrower(s) or any other
Security Parties which in the opinion of the Lender would have an adverse impact on the ability of the Borrower(s) and/or the
other Security Parties to perform its obligations under this Agreement and the other Security Documents in accordance with the
terms hereof; and

 

	(s)		the additional conditions precedent set out in the relevant Letters of Offer shall
have been satisfied and fulfilled.

 

Pending fulfillment in a manner satisfactory of any of the conditions
hereinbefore stipulated, the Lender may at its absolute discretion withdraw, cancel, terminate or suspend the Facilities or disbursement
of any part thereof.

 

    	12

    	 

    
 

SECTION
5.02       PERFORMANCE OF COVENANTS

 

The obligation of the Lender to grant the Facilities under this
Agreement or to continue with the Facilities shall also be subject to the following conditions:

 

	(a)		the Lender is satisfied that no event has occurred so as to render the Facilities
immediately repayable and no event of default under any agreement or arrangement referred to in this Agreement and the other Security
Documents shall have happened and be continuing;

 

	(b)		there shall not !lave occurred any default in the performance by any party thereto
of any covenant or agreement contained in any of the agreements and arrangements referred to in Section 5.02(a) hereof;

 

	(c)		the matters represented by the Borrower(s) set out in Section 3.01 are true and correct
in all respects;

 

	(d)		no extraordinary circumstances or changes of law or other governmental action shall
have occurred which shall make it improbable that the Borrower(s) will be able to observe and perform the covenants and obligations
on the Borrower(s)' part to be observed and performed under the provisions of this Agreement;

 

	(e)		no extraordinary circumstances or change of law or circumstances or other governmental
action shall have occurred or is likely in the opinion of the Lender to occur which shall in the opinion of the Lender render
it unlawful to grant the Facilities or to grant the Facilities on the security contemplated hereunder.

 

SECTION 5.03       WAIVER OF CONDITIONS PRECEDENT

 

It is hereby expressly acknowledged and declared that the terms
and conditions contained in this Article V are inserted for the sole benefit of the Lender and may therefore be waived wholly or
in part by the Lender at the sole and absolute discretion of the Lender unconditionally or upon terms and conditions specified
by the Lender without prejudicing the rights of the Lender hereunder and such waiver shall not preclude the Lender from insisting
on the Borrower(s)' compliance with such waived terms and conditions at a subsequent time.

 

 

ARTICLE VI 

 

UTILISATION OF THE FACILITIES

 

SECTION 6.01       UTILISATION OF THE FACILITIES

 

In the event that the Facilities or part of it shall for whatever
reason be unutilised after three (3) months from the date of the relevant Letter of Offer or after such other period as the Lender
may stipulate at its absolute discretion, the Lender shall be at liberty at its absolute discretion to withdraw the Facilities
in which event the Borrower(s) shall reimburse all costs, fees and expenses including legal fees incurred by the Lender or to vary
the terms of the Facilities.

 

SECTION 6.02       ADVANCE TO THIRD PARTIES

 

The Lender shall be at liberty and is hereby expressly authorised
by the Borrower(s) to advance or pay the whole of the Facilities or such part or parts thereof to any financial institution, firm
of solicitors, Developer/Vendor or the Contractor, builder architect or such other person(s) responsible for or concerned with
the sale and/or construction of the Said Property or to any other person at such times in such manner by such amounts and upon
such contingencies and conditions as the Lender may in its absolute discretion decide and/or by Progressive Releases or otherwise
in accordance with the schedule of payment set out in the Sale and Purchase Agreement or such variations in the order of the schedule
of payment as the Lender may in its absolute discretion deem fit.

 

AND it is hereby declared that such express authorisation as aforesaid
shall be irrevocable AND it is hereby expressly acknowledged, agreed and confirmed by the Borrower(s) that all advances and payments
to the party(ies) aforesaid shall for all purposes whatsoever be deemed to be and form part of the monies secured by and owing
under this Agreement and the acknowledgment of receipt by the aforesaid party(ies) shall be as good and sufficient and effective
as if the same had been made or given by the Borrower(s) personally.
And it is hereby further irrevocably agreed and confirmed by the Borrower(s) that the Borrower(s) shall not be entitled to object
to or to restrain such payment by the Lender.

 

    	13

    	 

    
 

And where applicable and without prejudice to the Lender's powers
and rights herein conferred it is hereby expressly agreed between the parties hereto that in the event of any default on the part
of the Developer/Vendor or the Contractor, as the case may be, in honouring its obligations to any financial institution or in
the opinion of the Lender the Developer/Vendor or the Contractor, as the case may be, and/or the Assignor(s) is/are in breach of
the Sale and Purchase Agreement or the Construction Agreement, as the case may be the Lender shall be at liberty to withhold the
disbursement or utilisation of the Facilities or any part or such part thereof and if the Lender decides to withhold any disbursement
or utilisation, the Borrower(s) shall indemnify and keep indemnified the Lender against all losses, actions, proceedings, costs,
expenses, claims and demands in respect of the same.

 

SECTION 6.03       OPERATION OF OVERDRAFT

 

In addition to and not in derogation of any of the conditions herein
contained, where the Facilities are a combination of Term Loan and Overdraft:-

 

	(a)		the Overdraft shall be available to the Borrower(s) only after the full drawdown of
the Term Loan; and

 

	(b)		prior to the full payment of the purchase price in respect of the Said Property, the
Borrower(s) shall not utilise the Overdraft for any other purpose than for the purpose of financing the purchase of the Said Property.

 

ARTICLE VII

 

INTEREST

 

SECTION 7.01A        CALCULATION OF INTEREST ON OVERDRAFT

 

The interest chargeable at the applicable Prescribed Rate shall
be calculated on the daily outstanding balance of the Borrower(s) Overdraft account and shall be debited at the end of every calendar
month and shall be paid monthly by the Borrower(s).

 

SECTION 7.01B       CALCULATION OF INTEREST ON TERM LOAN

 

The interest chargeable on any part of the Term Loan advanced or
disbursed by the Lender or otherwise howsoever payable by the Borrower(s) to the Lender under this Agreement (whether the same
shall form part of the Term Loan or otherwise) from the date on which the same shall have been advanced or disbursed or become
payable as aforesaid and (i) in the case where principal and interest payments are aggregated in the Instalments, until the full
amount of the Term Loan shall have been advanced or paid to or on behalf of or for the Borrower(s) or (ii) in the case where the
Instalments comprise of principal only and interest is paid separately, until the Term Loan has been repaid in full, shall be calculated
on the amount outstanding and shall become due in the matter and at the times as provided in Section 4.01(B)(b) hereof.

 

	(a)		CALCULATION WHERE INTEREST IS ON YEARLY RESTS

 

The interest chargeable at the applicable Prescribed Rate between
the date on which the full amount of the Term Loan shall have been advanced or paid as aforesaid and the last day of the existing
year shall be calculated on the full amount of the Term Loan and all other sums then payable by the Borrower(s). In and for each
succeeding year thereafter, interest at the Prescribed Rate shall be calculated on the total amount of the monies due to the Lender
hereunder (whether for principal or interest) as at the last day of the preceding year and shall be deemed to be due on the first
day of the year then commencing.

 

	(b)		CALCULATION WHERE INTEREST IS ON MONTHLY RESTS

 

The interest chargeable at the applicable Prescribed Rate shall
be calculated on the full amount of the Term Loan and all other sums then payable by the Borrower(s) as from the date of release
till the end of the month of such release. In and for each succeeding month thereafter, interest at the Prescribed Rate shall be
chargeable on the sum owing as at the last day of the preceding month and shall be due and payable on the first day of the following
month.

 

 

    	14

    	 

    
 

 

No part of any Instalments to be paid by the Borrower(s) as hereinbefore
provided or any other payments which the Borrower(s) may make to the Lender shall be deemed to be a repayment of principal until
all interest due or deemed to be due to the 'Lender has been paid.

 

	(c)		CALCULATION WHERE INTEREST IS ON DAILY RESTS

 

The interest chargeable at the applicable Prescribed Rate shall
be calculated on the daily outstanding balance of the principal sums in the Term Loan account and shall be debited at the end of
every calendar month and shall be due and payable on the first day of the following month.

 

No part of any Instalments to be paid by the Borrower(s) as hereinbefore
provided or any other payments which the Borrower(s) may make to the Lender shall be deemed to be a repayment of principal until
all interest due or deemed to be due to the Lender has been paid.

 

SECTION 7.02       VARIATION OF INTEREST RATE

 

	(a)		Notwithstanding the provisions relating to the Base Lending Rate and/or the percentage
of interest imposed above the Base Lending Rate and/or the commission/discount rates as hereinabove provided, the Lender shall
be entitled, from time to time (both before and after judgement or order) and without any requirement for the agreement of the
Borrower(s), to vary at the discretion of the Lender the Base Lending Rate and/or such percentage of interest imposed above the
Base Lending Rate (including changing entirely the basis upon which the Prescribed Rate and/or the Default Rate is arrived at)
and/or the applicable rest period and/or the commission/discount rates in the manner hereinafter set out:-

 

	(i)		in respect of the Base Lending Rate by placing in one issue of a daily national newspaper
a general notice of change of the Base Lending Rate addressed to the public generally or by ·posting a notice of such variation
in any of the Lender's branch premises;

 

	(ii)		in respect of the percentage of interest imposed above the Base Lending Rate, or the
applicable rest period, and/or the commission/discount rates the Lender has the discretion to vary such rates or the rest period
in the same manner set out in subsection (i) above or by serving a notice in writing on the Borrower(s), which written notice
may be incorporated into the Lender's bank statements forwarded to the Borrower(s) periodically.

 

PROVIDED ALWAYS that the effective date of the change of the Base
Lending Rate and/or the · percentage of interest imposed above the Base Lending Rate and/or the applicable rest period and/or
the commission/discount rates shall be the date specified in the advertisement or in the notice, and if notice be given in the
Lender's bank statement, the date specified in the bank statement, notwithstanding that such specified date from which the amended
Base Lending Rate or percentage of interest above the Base Lending Rate or the rest period or the commission/discount rates are
payable or applicable shall be earlier than the date of the advertisement or notice, as the case may be. Notwithstanding the issue
of the general notice specified in subclause (i) above, the Lender may at its absolute discretion decide (without any further notice
to the Borrower(s)) that such variation shall not apply to the Borrower(s) and the Security Parties to whom a demand under Section
4.03 had been made or legal proceedings had been commenced against the Borrower and/or any of the Security Parties.

 

	(b)		The decision of the Lender as to what at any time is the Base Lending Rate or the
percentage of interest above the Lender's Base Lending Rate or the applicable rest period or the commission/discount rates and
the date(s) from which such amendments shall take effect, shall be final and conclusive and shall not be questioned on any account
whatsoever.

 

	(c)		Where repayment of the Term Loan and interest thereon is by way of instalments then,
if and whenever the rate of interest payable by the Borrower(s) and/or the applicable rest period under this Agreement shall be
varied in the manner herein this Agreement appearing, the Lender may, at its absolute discretion, make the necessary adjustment
consequent upon such variation either:-

 

	(i)		by varying the amount of any Instalments; and/or

 

	(ii)		by varying the number of the Instalments.

 

 

    	15

    	 

    
 

SECTION
7.03         CAPITALISATION OF ALL MONIES DUE

 

	(a)		Subject always to Section 7.04, the interest on any monies for the time being hereby
secured including capitalised interest shall at the end each calendar month be capitalised and added for all purposes to the principal
sum then owing and shall thenceforth bear interest at the applicable Prescribed Rate or as the case may be, the applicable Default
Rate and be secured and payable accordingly and all covenants and conditions .contained in or implied by these presents and all
powers and remedies conferred by law or these presents and all rules of law or equity in relation to the said principal sum and
interest shall equally apply to such capitalised arrears of interest and to interest on such arrears.

 

	(b)		The right of the Lender to charge compound interest as conferred on the Lender by
this Agreement shall subsist and continue to subsist notwithstanding the issue and/or service of a demand for payment of monies
or any of the monies hereby secured and/or notwithstanding that the relationship of financier-customer between the parties hereto
shall have ceased for any reason or due to any cause whatsoever.

 

SECTION 7.04       INTEREST EXCLUDED FROM LIMIT OF PRINCIPAL

 

For the purpose of ascertaining whether the limit of the Facilities
intended to be hereby secured has been exceeded or not all accumulated and capitalised interest shall be deemed to be interest
and not principal sum.

 

 

ARTICLE VIII

 

SECTION 8.01        COMMITMENT FEE

 

The Borrower(s) expressly agree(s) and undertake(s) to pay a commitment
fee of one per centum (1%) per annum (or such other rate as determined by the relevant authorities from time to· time and
so imposed by the Lender) on any portion of the Overdraft limit unutilised by the Borrower(s) and such commitment fee is to be
debited to the account at the end of each calendar month and be capitalised and added for all purposes to the principal sum then
owing and shall thenceforth bear interest at the applicable Prescribed Rate or as the case may be, the applicable Default Rate
and be secured and payable accordingly and all the covenants and conditions contained in this Agreement in relation to the principal
sum and interest shall equally apply to the said commitment fee and to such capitalised arrears of interest thereon. Further, for
the purposes of ascertaining whether the Overdraft limit intended to be hereby secured has been exceeded or not all accumulated
and capitalised fee shall not be deemed to be principal sum.

 

SECTION 8.02        PREPAYMENT

 

	(a)		Notwithstanding any provision for payment by Instalments hereinbefore contained, the
Borrower(s) may at any time by giving the Lender three (3) months' notice in writing or such other notice period as may be stipulated
by the Lender (which said period shall be calculated from the date of the Lender's actual receipt of the said notice) or by paying
interest for the period corresponding to the notice period, in lieu of such notice, prepay the Term Loan, interest thereon and
all other monies then owing to the Lender under this Agreement or such lesser amount as the Lender may at its discretion accept
PROVIDED ALWAYS that:-

.

	(i)		the whole principal amount of the Term Loan has been disbursed by the Lender;

 

	(ii)		any partial prepayment shall be in multiples of not less than Ringgit One Thousand
(RMI1,000-00) only or such other amount as stipulated by the Lender and shall be applied towards payment or on account of the
Instalments in the inverse order of their maturity;

 

To incorporate a new sub-clause under (a) (v):-

 

"where the prepayment is made prior to the maturity of the
tenure of the Facilities or specified lock-in period as stated in the Letters of Offer or failure to drawdown after a drawdown
notification, the Borrower(s) shall pay such amount as determined by the Lender at its sole and absolute discretion representing
any loss incurred by the Lender as a result of or arising from such prepayment or failure to drawdown and the cost of the Lender
for having funded the Facilities up to the date the prepayment is made".

 

    	16

    	 

    
 

	(b)		Save as provided in this Section 8.02(a), the Borrower(s) shall not be entitled to
prepay the Term Loan or any part thereof unless with the consent of the Lender in writing.

 

	(c)		Notwithstanding any provisions in this Agreement to the contrary the Lender may allow
the Borrower(s) to redraw or reborrow any of the amounts prepaid at any time and from time to time and such amounts redrawn or
reborrowed together with interest thereon at the applicable Prescribed Rate and/or Default Rate as the case maybe (both before
as well as after judgment or order) shall for all purposes whatsoever be deemed to be and from part of the Indebtedness secured
by and owing under this Agreement.

 

SECTION 8.03       REVIEW OF ACCOUNTS

 

	(a)		Nothing in the Letters of Offer or in this Agreement shall be deemed to impose on
the Lender any obligation either at law or in equity to make or to continue to make available the Facilities to the Borrower(s).
The Facilities and all other monies payable hereunder, including renewal fee thereon (where applicable) shall be payable on demand.

 

	(b)		Notwithstanding anything to the contrary in the Letters of Offer or this Agreement,
and further notwithstanding any specific purpose(s) for the Facilities agreed to in the Letters of Offer, the Lender shall be
entitled to review the granting and/or continuation of the Facilities at any time and from time to time (irrespective of whether
or not the Facilities or any part thereof has been utilised / disbursed or whether any Event of Default has occurred) and to exercise
any of its rights or powers to withdraw, cancel, suspend, terminate or recall the Facilities or any part thereof, and the Borrower(s)
hereby agree(s) to immediately accept such decision and/or repay to the Bank the Indebtedness then due and outstanding.

 

 

ARTICLE IX 

 

SECURITY

 

SECTION 9.01       SECURITY

 

	(a)		Security by Assignment

 

	(i)		For the consideration aforesaid the Borrower(s) shall absolutely assign (if the Borrower(s)
is also the Assignor(s)) or shall cause the Assignor(s) as the case may be to absolutely assign to the Lender the Said Property
and the full and entire benefit of the Sale and Purchase Agreement or the Principal Sale and Purchase Agreement (in the case where
the Borrower is not the first purchaser), together with all rights, title and interests of the Assignor(s) therein PROVIDED ALWAYS
that notwithstanding the Assignment or any other provision of this Agreement, the Assignor(s) shall continue to observe and be
bound by all whatsoever conditions, covenants and stipulations therein on the Assignor(s) expressed and contained in the Sale
and Purchase Agreement or the Principal Sale and Purchase Agreement (in the case where the Borrower is not the first purchaser);

 

	(ii)		Upon issuance of an individua/strata title to the Said Property, the Borrower(s) shall
at the Borrower(s)' cost and expense immediately take a transfer of and execute a legal charge (hereinafter called "the Charge")
over the Said Property or shall cause the Assignor(s) as the case may be to do so, in the Lender's standard form or such variation
thereof as the Lender may require to secure the repayment and payment to the Lender of the Facilities then due, interest thereon
and all other monies payable and owing by the Borrower(s) to the Lender under or pursuant to this Agreement failing which the
Lender is entitled to take such cause of action to protect the Lender's interest and the costs and expenses including the costs
of the Lender's solicitors (on a solicitor and own client basis) in connection with the preparation, execution and registration
of the Charge shall be borne and paid by the Borrower(s) and/or the Assignor(s).

    	17

    	 

    
	

	(b)		Save as provided in this Section 8.02(a), the Borrower(s) shall not be entitled to
prepay the Term Loan or any part thereof unless with the consent of the Lender in writing.

 

	(c)		Notwithstanding any provisions in this Agreement to the contrary the Lender may allow
the Borrower(s) to redraw or reborrow any of the amounts prepaid at any time and from time to time and such amounts redrawn or
reborrowed together with interest thereon at the applicable Prescribed Rate and/or Default Rate as the case maybe (both before
as well as after judgment or order) shall for all purposes whatsoever be deemed to be and from part of the Indebtedness secured
by and owing under this Agreement.

 

SECTION 8.03       REVIEW OF ACCOUNTS

 

	(a)		Nothing in the Letters of Offer or in this Agreement shall be deemed to impose on
the Lender any obligation either at law or in equity to make or to continue to make available the Facilities to the Borrower(s).
The Facilities and all other monies payable hereunder, including renewal fee thereon (where applicable) shall be payable on demand.

 

	(b)		Notwithstanding anything to the contrary in the Letters of Offer or this Agreement,
and further notwithstanding any specific purpose(s) for the Facilities agreed to in the Letters of Offer, the Lender shall be
entitled to review the granting and/or continuation of the Facilities at any time and from time to time (irrespective of whether
or not the Facilities or any part thereof has been utilised / disbursed or whether any Event of Default has occurred) and to exercise
any of its rights or powers to withdraw, cancel, suspend, terminate or recall the Facilities or any part thereof, and the Borrower(s)
hereby agree(s) to immediately accept such decision and/or repay to the Bank the Indebtedness then due and outstanding.

 

 

ARTICLE IX 

 

SECURITY

 

SECTION 9.01       SECURITY

 

	(a)		Security by Assignment

 

	(i)		For the consideration aforesaid the Borrower(s) shall absolutely assign (if the Borrower(s)
is also the Assignor(s)) or shall cause the Assignor(s) as the case may be to absolutely assign to the Lender the Said Property
and the full and entire benefit of the Sale and Purchase Agreement or the Principal Sale and Purchase Agreement (in the case where
the Borrower is not the first purchaser), together with all rights, title and interests of the Assignor(s) therein PROVIDED ALWAYS
that notwithstanding the Assignment or any other provision of this Agreement, the Assignor(s) shall continue to observe and be
bound by all whatsoever conditions, covenants and stipulations therein on the Assignor(s) expressed and contained in the Sale
and Purchase Agreement or the Principal Sale and Purchase Agreement (in the case where the Borrower is not the first purchaser);

 

	(ii)		Upon issuance of an individua/strata title to the Said Property, the Borrower(s) shall
at the Borrower(s)' cost and expense immediately take a transfer of and execute a legal charge (hereinafter called "the Charge")
over the Said Property or shall cause the Assignor(s) as the case may be to do so, in the Lender's standard form or such variation
thereof as the Lender may require to secure the repayment and payment to the Lender of the Facilities then due, interest thereon
and all other monies payable and owing by the Borrower(s) to the Lender under or pursuant to this Agreement failing which the
Lender is entitled to take such cause of action to protect the Lender's interest and the costs and expenses including the costs
of the Lender's solicitors (on a solicitor and own client basis) in connection with the preparation, execution and registration
of the Charge shall be borne and paid by the Borrower(s) and/or the Assignor(s).

 

	(b)		Security by Charge

 

	(i)		For the consideration aforesaid, where the individual title to the Said Property has
been issued, the Assignor(s) shall execute in favour of the lender the Charge in form and substance acceptable to the Lender.

	

 

	(b)		Security by Charge

 

	(i)		For the consideration aforesaid, where the individual title to the Said Property has
been issued, the Assignor(s) shall execute in favour of the lender the Charge in form and substance acceptable to the Lender.

 

 

    	18

    	 

    
 

	(ii)		The Lender's rights arid security interest over the Said Property shall continue to
subsist and the Assignor(s) shall continue to observe and be bound by all whatsoever conditions, covenants and stipulations contained
in the Charge annexure, notwithstanding any discharge or other release of the Charge for title administrative purposes, including
but not limited to renewal or extension of a lease, obtaining a title-in-continuation, subdivision or amalgamation. In any of
such events, the Borrower(s) and Assignor(s) acknowledge and confirm that such discharge or release of the Charge is temporary
and that fresh charge(s) shall be created over the new title(s) immediately upon issuance, and that all references herein and
in the Letters of Offer to "Charge" shall be read and construed as referring to such fresh charge notwithstanding any
difference in the particulars of the title(s). All costs and expenses incurred in the discharge or release of the Charge and the
creation of fresh charge(s) shall be borne by the Borrower(s) and Assignor(s) and the Lender shall be entitled to debit the Borrower(s)'
account for the same.

 

SECTION 9.02       POWER OF ATTORNEY

 

	(a)		In addition to the Assignment, the Borrower(s) shall also execute and deliver or cause
the Assignor(s) as the case may be to execute and deliver to the Lender a Power of Attorney in form and substance acceptable to
the Lender whereby the Assignor(s) appoint the Lender or any persons authorised by the Lender for the time being as the attorney
of the Assignor(s) and in the Assignor(s)' name and on the Assignor(s)' behalf to deal with the Said Property. The Lender may
waive this Power of Attorney if the security over the Said Property is by way of Charge.

 

	(b)		For the consideration stated in Article IV of this Agreement, the Borrower(s) do hereby
irrevocably appoint the Lender or any person authorised by the Lender and his or their substitute or substitutes as the attorney
of the Borrower(s) ("Attorney") and in the Borrower(s)' name(s) and on the Borrower(s)' behalf to do all whatsoever
acts and execute all whatsoever documents necessary to perfect any of the Security Documents, including but not limited to rectification
of manifest errors.

 

SECTION 9.03       THE GUARANTEE AND OTHER SECURITIES (IF ANY)

 

The Borrower(s) shall cause the Guarantor(s) simultaneously with
the execution of this Agreement to enter into the Guarantee under which the Guarantor(s) will guarantee the Lender with the repayment
and payment of the Indebtedness as may now or at any time and from time to time hereafter be owing or payable by the Borrower(s)
to the Lender in respect of the Facilities under the terms of this Agreement and also the due observance and performance by the
Borrower(s) of all the agreements, terms, conditions, covenants, stipulations and undertakings on the part of the Borrower(s) to
be observed and performed as contained in this Agreement and any other related documents.

 

The Borrower(s) shall execute or cause the Security Parties to execute
and deliver any other Security Documents which the Lender may require to secure the repayment and payment to the Lender of the
Indebtedness.

 

SECTION 9.04        CONTINUING SECURITY

 

The securities created under this Agreement and any other instruments
relating to the security of the Facilities are expressly intended to be and shall be a continuing security for the repayment and
payment of the Indebtedness notwithstanding that the account or accounts of the Borrower(s) with the Lender shall cease to be current
for any reason whatsoever and notwithstanding any settlement of account or accounts or otherwise.

 

SECTION 9.05        COVENANT TO PROVIDE FURTHER SECURITY

 

	(a)		The Borrower(s) will at any time and when required by the Lender execute in favour
of the Lender or as the Lender shall direct such further legal or other mortgages, charges, debentures, assignments, transfers,
agreements or other assurances as the Lender shall require of and on all the Borrower(s)' rights, title and interests in any property
or asset or business now belonging to or which may hereafter be acquired by or belonging to the Borrower(s) (including any vendor's
lien) and the benefit of all licenses held in connection therewith to secure all monies and liabilities hereby agreed to be paid
or intended to be hereby secured, such mortgages, charges, assignments, transfers, agreements or other assurances to be prepared
by or on behalf of the Lender at the cost of the Borrower(s) and to contain all such terms and conditions for the benefit of the
Lender as the Lender may require or stipulate.

 

 

    	19

    	 

    
 

 

	(b)		The Borrower(s) ·shall at any time and when required by the Lender to do so
deposit with the Lender the document(s) of title of any or all immovable properties vested in the Borrower(s) for any tenure and
all·or any debentures; shares, stocks or other investments or securities registered in the name of the Borrower(s) or otherwise
belonging to the Borrower(s). Such deposit may be by way of collateral security for the repayment of monies and liabilities hereby
secured and may also or otherwise be for the purpose of securing any. other monies owing to the Lender and not secured hereby.

 

 

ARTICLE X 

 

INSURANCE

 

SECTION 10.01        INSURANCE

 

	(a)		The Borrower(s) shall during the continuance of this Agreement keep any building or
fixture or structure whatsoever now or at any time hereafter erected on or affixed to the Said Property properly insured or shall
cause the Assignor(s) to do so, as the case may be, against loss or damage by fire and such other risks as the Lender may require
up to the full insurable value thereof in the joint names of the Assignor(s) and the Lender with such insurance company as may
from time to time be approved by the Lender and nominate the Lender as "Loss Payee" and will cause the Assignor(s) to
deposit the policy or policies of such insurance with the Lender and will from time to time pay or cause to be paid the premium
thereon and deliver or cause to be delivered the receipts for the same to the Lender. Such policies of insurance shall not be
cancelled without the prior written consent of the Lender.

 

	(b)		In addition to and not in derogation of the agreements and stipulations implied and
the obligations imposed and the rights created by law, custom and this Agreement, the Borrower(s) will if so required by the Lender
at the cost and expense of the Borrower(s) and/or the Assignor(s) to insure and keep insured the whole of the Said Property and
effects included in this Agreement and/or any part or parts thereof of an insurable nature against loss or damage by fire and
such other risks and contingencies of whatsoever nature for such amount in such names and with such insurers and through such
agencies as the Lender may from time to time stipulate.

 

	(c)		In the event of the Assignor(s) not effecting, maintaining or renewing any such insurance
as aforesaid it shall be lawful for but not obligatory upon the Lender at the cost and expense of the Borrower(s) and/or the Assignor(s)
to effect, maintain or renew any such insurance as aforesaid as the Lender may think fit.

 

	(d)		Without prejudice to the preceding provisions of this Section (and whether or not
the Borrower(s) shall be in default) it is agreed that if the Lender shall in its absolute discretion consider it desirable or
expedient the Lender shall be at liberty and is hereby expressly authorised to effect maintain or renew any such insurance as
aforesaid as the Lender may think fit and any cost and expense so incurred shall be for the account of the Borrower(s) and/or
the Assignor(s).

 

SECTION 10.02       OTHER INSURANCE

 

The Lender may from time to time and at any time require the Borrower(s)
to take out and maintain a mortgage reducing term assurance policy or a life insurance policy and to assign the said life policy
and all benefits and advantages thereunder to the Lender as further security for all monies hereby secured and in default by the
Borrower(s) in taking out and maintaining such policy and assigning the same as and when required, the Lender may at its discretion
at the cost and expense of the Borrower(s) take out and maintain such policy guaranteeing the repayment of all monies hereby secured
or any part thereof on such terms as the Lender may think fit.

 

SECTION 10.03       CONFLICTING INSURANCE

 

Save and except at the request or with the prior written consent
of the Lender, the Borrower(s) and/or the Assignor(s) shall not effect or maintain any insurance against any risk in respect of
the aforementioned buildings, fixtures, structures, property and effects of the Said Property where the Lender the Borrower(s)
has/have effected or maintained any such insurance as aforesaid.

 

 

    	20

    	 

    
 

 

SECTION 10.04        APPLICATION OF INSURANCE MONIES

 

	(a)		The Lender may at its discretion require all monies received on any insurance policies
taken as aforesaid whether effected by the Lender or by the Assignor(s) to be applied in or towards making good the loss or damage
in respect of which the monies is received or at the option of the Lender in or towards the discharge of any money secured hereby
and the Assignor(s) shall hold monies so received on such insurance in trust for the Lender and the Lender may receive and give
a good discharge of all such monies:

 

	(b)		Pending the receipt of any monies by the Lender from the insurance company, the Borrower(s)
shall continue paying to the Lender whatever monies due and payable herein.

 

	(c)		In the event that the Lender chooses to apply the monies received under any insurance
policies to make good the loss or damage to the Said Property the Borrower(s) or tl\e Assignor(s) shall in addition to continuing
to pay whatever monies due or payable herein, bear the difference between the cost of making good such loss or damage and the
monies received from the insurance company.

 

	(d)		In the event that the Lender chooses to utilise the monies received under any insurance
policies to discharge all monies hereby secured and the monies received is less than the amount due to the Lender hereunder including
interest and all monies and other charges due and payable by the Borrower(s) to the Lender hereunder the Borrower(s) shall pay
the Lender the difference between the amount due and the amount so received within seven (7) days from the date of demand by the
Lender and until such payment will also pay interest on such difference at the applicable Default Rate or such other rate as the
Lender may impose from time to time at its absolute discretion calculated in the manner then applicable to the monies hereby or
intended to be hereby secured.

 

 

ARTICLE XI 

 

GOVERNMENT ACQUISITION

 

SECTION 11.01        GOVERNMENT ACQUISITION

 

In the event that the Said Property or any part thereof shall at
any time become the subject matter of or be included in any notice, notification or declaration concerning or relating to acquisition
by government or any government authority or any enquiry or proceedings in respect thereof, the Borrower(s) and/or the Assignor(s)
shall forthwith inform the Lender of the same and shall forward to the Lender a copy or copies of any such notice, notification
or declaration as soon as the same shall be delivered to or served on the Assignor(s). In addition and without prejudice to Section
12.01(m), the Lender shall be entitled at the expense of the Borrower(s) and/or the Assignor(s) to engage such advisers and agents
(including solicitors and valuers) as it may think fit for the purpose of appearing or attending at or advising upon any enquiry
or proceedings affecting, concerning or relating to any such acquisition. All monies received as or by way of compensation for
any such acquisition of the Said Property or any part thereof shall be applied in or towards the discharge or repayment of any
money or liability secured by this Agreement and the Borrower(s) shall and hereby declare(s) that the Borrower(s) shall cause the
Assignor(s) to hold all monies if paid to and so received by the Assignor(s) in trust for the Lender and the Borrower(s) and/or
the Assignor(s) agree(s) and confirm(s) that the Lender may receive and give a good discharge for all such monies.

 

In the event of all such monies aforesaid being less than the amount
due to the Lender hereunder including interest and all monies and other charges due and payable by the Borrower(s) to the Lender
hereunder, the Borrower(s) shall forthwith pay to the Lender the difference between the amount due and the amount so received and
until such payment will also pay interest on such difference at the applicable Default Rate or such other rate as the Lender may
impose from time to time at its absolute discretion calculated in the manner then applicable to the monies hereby or intended to
be hereby secured.

 

 

ARTICLE XII 

 

EVENTS OF DEFAULT

 

SECTION 12.01.        EVENTS OF DEFAULT

 

The whole of the Indebtedness shall become due and immediately repayable
by the Borrower(s) to the Lender and the Lender shall forthwith become entitled to recover the same with interest thereon at the
applicable Default Rate or such other rate as the Lender may
impose from time to time at its absolute discretion (whether before or after judgment) as the case maybe, and to exercise the rights
and powers upon default herein this Agreement and by law provided without any previous notice to or concurrence on the part of
the Borrower(s)'upon the happening of any of the following events.:-

 

 

    	21

    	 

    
 

	(a)		if the Borrower(s) or any other Security Parties fail(s) to make payment of the monies
owing to the Lender hereby secured after the expiration of the demand and notice referred to in Section 4.03 hereof;

 

	(b)		if the Borrower(s) or any other Security Parties shall default in the payment on due
dates of any one or more of the Instalments or any interest thereon or other sums or monies (whether principal or interest) herein
agreed or covenanted by the Borrower(s) to be paid;

 

	(c)		if the Borrower(s) or any other Security Parties fail to observe or perform any of
the agreements, covenants, stipulations, terms and conditions on the part of the Borrower(s) or any other Security Parties under
this Agreement or under any of the Security Documents or under the Sale and Purchase Agreement or the Construction Agreement,
as the case may be;

 

	(d)		if the Borrower(s) or any other Security Parties shall enter into any composition
or arrangement with or for the benefit of the creditors of the Borrower(s) or any other Securities Parties or threaten to do so
or allows any judgment against the Borrower(s) or any other Security Parties to remain unsatisfied for a period of twenty-one
(21) days or has any distress or execution or other process of a Court of competent jurisdiction levied upon or issued against
any property of the Borrower(s)'or any other Security Parties and such distress or execution or other process, as the case may
be, is not satisfied by the Borrower(s) or any other Security Parties within seven (7) days thereof;

 

	(e)		if the Lender decides in its sole discretion that the continuation of the Facilities
or any part thereof would be likely to be detrimental to its own position or otherwise undesirable or that its security hereunder
is inadequate or in jeopardy or that any event or events has/have occurred or a situation exists which could or might prejudice
the Borrower(s)' or any of the other Security Parties' ability to perform its and/or any of the other Security Parties' obligation(s)
hereunder in accordance with the terms hereof, or any of the other Security Documents as the case may be;

 

	(f)		if the Borrower(s) or any other Security Parties commits any act of bankruptcy or,
being a corporation, suffers any petition or passes any resolution for its winding up or enters into receivership;

 

	(g)		if the Borrower(s) or any other Security Parties is prosecuted under any law, serves
any custodial sentence, becomes insane or dies;

 

	(h)		if a change in applicable law or regulation makes it impossible or unlawful for the
Lender to continue its making available the Facilities or any part thereof to the Borrower(s) or if the Borrower(s) or any other
Security Parties shall be affected by a material change in its circumstances which in the opinion of the Lender has an adverse
impact on the ability of the Borrower(s) and/or the other Security Parties to perform its obligations under this Agreement and
the other Security Documents in accordance with the terms hereof;

 

	(i)		if any of the Security Documents cannot be perfected for any reason whatsoever or
the Charge cannot be registered or is invalid for any reason whatsoever;

 

	(j)		if a step is taken for the prosecution, winding-up, dissolution, liquidation or restructuring,
as the case may be, of the Borrower(s) or any other Security Parties or a petition for winding-up (voluntary or otherwise) is
presented against the Borrower(s) or any other Security Parties or any prosecution, winding up proceedings ate threatened against
the Borrower(s) or any other Security Parties;

 

	(k)		if the Borrower(s) or any of the Security Parties ceases or threatens to cease to
carry on its business or if there is any change in the major shareholders and/or management of the Borrower or any of the Security
Parties;

 

	(I)		if a notice or proposal for compulsory acquisition of the Said Property shall be issued
or made under or by virtue of an Ordinance, Act of Parliament or other statutory provisions;

 

 

    	22

    	 

    
 

 

	(m)		if a receiver and/or manager of the Borrower(s)' and/or any other Security Parties'
properties, assets or undertakings or any part thereof shall be appointed and such appointment shall be deemed by the Lender to
be prejudicial for this Security;

 

	(n)		if the Borrower(s) or any other Security Parties or any other party applies to the
Court or any other authority to restrain the Lender and/or any of its .other creditors or any of them from proceeding in any manner
whatsoever to enforce whether in a Court of law or otherwise any of their rights or securities including guarantees under any
agreement, debentures or security documents;

 

	(o)		if a Special Administrator of the Borrower(s) or any other "affected person"
(as defined in Section 21 of the Pengurusan Danaharta Nasional Berhad Act 1998) is appointed or an application is made by the
Borrower(s) or any other "affected person" to Pengurusan Danaharta Nasional Berhad ("anaharta") for the appointment
of a Special Administrator or a recommendation is made by Danaharta to the Oversight Committee (established under Section 22 of
the Pengurusan Danaharta Nasional Bhd Act 1998), for the appointment of a Special Administrator of the Borrower(s) or any other
"affected person"; or

 

	(p)		if any of the Security Parties shall withdraw themselves or purport to withdraw themselves
or any security under the Security Documents shall be withdrawn or uplifted without the Lender's prior written consent.

 

NOTWITHSTANDING the fact that the Lender may not have exercised
any remedy available to it immediately on default by the Borrower(s) or that it may have accepted monies from the Borrower(s) after
such default the Lender shall not be held to have condoned or acquiesced in such default and may at any time thereafter exercise
all or any of the remedies available to it and any delay on the part of the Lender in taking steps to enforce the remedies conferred
on and/or available to it by this Agreement or statute shall not be held to prejudice its rights of action in respect thereof.

 

 

ARTICLE XIII 

 

REMEDIES OF THE LENDER

 

SECTION 13.01        REMEDIES OF THE LENDER

 

Upon demand or the occurrence of any Event of Default the Lender
shall be entitled to exercise such rights as the Lender may have under any of the Security Documents or at law including all or
any of the rights and powers following:-

 

	(a)		the right to terminate the license and/or to enter and take possession of the Said
Property or any part or parts thereof;

 

	(b)		the right to let, lease or demise the Said Property or any part or parts thereof for
such tenancy or term of year at such rent and generally upon such terms as the Lender in its absolute discretion shall think fit;

 

	(c)		the right and power to sell and assign the Said Property by public auction, tender
or private treaty as the absolute unencumbered owner thereof at such price or prices and in such matter as the Lender shall in
its absolute discretion think fit free from any interest of the Assignor(s) hereunder or otherwise and the right to bid at any
such sale;

 

	(d)		the right to sue and institute by way of civil suit or action for the recovery of
the Facilities interest thereon and all other monies payable hereunder, whether before first realising the Said Property or otherwise
or concurrently with any of the other rights and remedies of the Lender herein or at law.

 

AND the Borrower(s) shall and hereby expressly agree(s), covenant(s)
and undertake(s) to do and execute or cause the Assignor(s) as the case may be to do and execute all acts, deeds, instruments and
things which the Lender may require or stipulate for the purpose of effecting and/or completing anything and/or any transaction
mentioned in this Section herein but without prejudice to the powers or the rights of the Lender in its capacity as the beneficial
owner of the Said Property by virtue of the Assignment

 

 

    	23

    	 

    
 

SECTION 13.02       PROCEEDS OF SALE

 

All monies received by the Lender from any proceeding instituted
or step taken pursuant to this Agreement or any other Security Documents securing the Facilities shall be applied by the
Lender:-

 

	FIRSTLY	in payment of all costs, ·charges and expenses incurred and payments made by the Lender under the provisions of this Agreement or any other related Security Documents (if any) and any taxes payable under any written law for the time being in force on the disposal of the Said Property;
	 	 
	SECONDLY	in or towards payment to the Lender of all interest then accrued and remaining unpaid in respect of the Facilities, or the balance thereof for the time being owing;
	 	 
	THIRDLY	in or towards payment to the Lender of the principal sum due and remaining unpaid under the Facilities;
	 	 
	FOURTHLY	in or towards payment to the Lender of all monies due and remaining unpaid or secured under this Agreement or any other Security Documents (if any);
	 	 
	FIFTHLY	in or towards payment to the Lender of the Borrower(s)' liabilities to the Lender (whether such liabilities be present, future, actual, contingent, primary, secondary, collateral, secured or unsecured, several or joint) under any other accounts of whatsoever nature, agreement or contract or otherwise with the Lender and all such monies available under this premise, are specifically held in trust for the Lender for the satisfaction of such liabilities;
	 	 
	SIXTHLY	any surplus shall be paid to such person(s) entitled thereto.

 

PROVIDED ALWAYS that if the Lender shall be of the opinion that
the security may prove deficient payments may be made to the Lender on account of principal before interest but such alteration
in the order of payment shall not prejudice the right of the Lender to receive the full amount to which it would have been entitled
if the primary order of payment had been observed or any lesser amount which the sum ultimately realised from the security may
be sufficient to pay.

 

SECTION 13.03        CONCURRENT EXERCISE OF REMEDIES

 

The Lender shall have absolute liberty to concurrently exercise
all or any of the rights and remedies available to the Lender whether by this Agreement or under the Security Documents (if any)
or at law or otherwise including without limitation the right to pursue its remedies of sale and possession pursuant to the provisions
herein or the applicable Acts and the right to recover by civil suit all monies howsoever due and owing by the Borrower(s), the
Security Parties or any other person to the Lender.

 

SECTION 13.04        DEFICIENCY IN THE PROCEEDS OF SALE

 

If the net proceeds of any sale of the Said
Property under the provisions herein or the applicable Acts or otherwise are less than the balance of the monies and interest
owing after deduction and payment from the proceeds of such sale of all fees (including the fees of the Lender's solicitors on
a full indemnity basis) dues, costs, rents, rates, taxes and other outgoings and all the costs and expenses incurred in connection
with the making and carrying into effect of the sale the Borrower(s) and/or Assignor(s) ·shall, notwithstanding that the
Lender may be the purchaser of the Said Property, pay the Lender the difference between the monies and interest owing and the
net proceeds of such sale and until payment the Borrower(s) and/or Assignor(s) shall also pay interest on such difference at the
applicable Default Rate, or such other rate as the Lender may impose from time to time at its absolute discretion, as the case
may be, such interest to be compounded with the rests period or such other rest as the Lender may determine PROVIDED that nothing
stated herein shall be construed in any manner whatsoever to bind or require the Lender to exercise its rights of sale of the
Said Property first before enforcing or suing on the Borrower(s)' personal
covenant or diminish the Lender's rights at  Borrower(s)' personal covenant to pay on demand or to restrict, affect
or diminish the lender's rights at law or in equity.

 

    	24

    	 

    
 

 

 

ARTICLE XIV

 

COVENANTS RELATING TO THE SAID PROPERTY

 

SECTION 14.01        OCCUPATION OF THE SAID PROPERTY AS A LICENSEE

 

Notwithstanding anything in this Agreement contained, it is hereby
declared that during the continuance of this Agreement and until a separate issue document of title is issued and transferred to
the Assignor(s) and the Charge in favour of the Lender is registered, the Borrower(s) shall occupy or ensure the Assignor(s) occupies
the Said Property merely as a licensee of the Lender and by no other right and within seven (7) days after the license to occupy
the Said Property has been terminated pursuant to Section 13.01 hereof the Borrower(s) shall at the Borrower(s)' own cost and expense
ensure that the Assignor(s) shall peaceably deliver immediate vacant possession of the Said Property to the Lender or to such other
person as the Lender may direct.

 

SECTION 14.02        COMPLIANCE WITH LAND TITLE CONDITIONS

 

The Borrower(s) shall comply or cause the Assignor(s) to comply
with and observe all the conditions, restrictions and category of the use express or implied to be imposed upon or relating to
or affecting the Said Property or to which the Said Property is to be subject as well as the provisions of any Act of Parliament,
Ordinance or Enactment for the time being in force and of any rules, regulations or orders made· thereunder affecting the
same.

 

SECTION 14.03        REASSIGNMENT ON FULL PAYMENT

 

Subject to and without prejudice to the Lender's rights and remedies
under Sections 16.04 and 16.14 herein or in respect of any antecedent claim or breach of covenant by the Borrower(s) and/or Security
Parties, at such time as the Borrower(s) and/or the Security Parties shall have paid the Lender all sums payable hereunder and/or
under the other Security Documents then:-

 

	(a)		the Lender shall at the cost and expense of the Borrower(s) and/or the Assignor(s)
reassign all its estate, right, title, benefit, interest, advantage, property, claim and demand whatsoever of, in or to the Said
Property under the Principal Sale and Purchase Agreement or the Sale and Purchase Agreement as the case may be to the Assignor(s)
and the Borrower(s) shall cause the Assignor(s) to accept the same, such reassignment' to be in such form and substance acceptable
to the Lender; and

 

	(b)		subject to Section 16.30 hereof, upon the execution by the Lender of the reassignment
provided for ·in paragraph (a) hereof, this Agreement shall forthwith terminate and be at an end except for the payment
by the Borrower(s) to the Lender hereunder of the monies payable by reason of the compliance by the Lender with the provisions
of this Section.

 

 

ARTICLE XV

 

SERVICE OF ORIGINATING PROCESS

 

SECTION 15.01        SERVICE OF ORIGINATING PROCESS

 

In the event legal proceedings are instituted by the Lender against
the Borrower(s) and/or any Security Party the originating process shall be deemed to have been duly served on the Borrower(s) and/or
such Security Parties:-

 

	(a)		if the originating process is sent by hand, at the time a copy of the originating
process is left at the address of the Borrower(s) and/or such Security Parties herein-stated or at such other address as the Borrower(s)
and/or such Security Parties may notify the Lender by way of AR registered post from time to time which address shall be within
Malaysia;

 

	(b)		if the originating process is sent by prepaid registered post, on the 7th day (including
the day of posting) from the date the originating process is put into post addressed to the Borrower(s) and/or such Security Parties
at the address of the Borrower(s) and/or such Security Parties herein-stated or such other address as the Borrower(s) and/or such
Security Parties may notify the lender by way of AR registered post from time to time which address shall be within Malaysia.

 

 

    	25

    	 

    
 

PROVIDED ALWAYS that the Lender shall only be deemed to have notification
of the Borrower(s)' or any of the Security Parties' change of address if the Lender has actually received the notice of such change
sent by the Borrower(s) or such Security Parties.

 

The provisions in this Section 15.01 (a) and (b) shall apply to
the service of any other legal processes whatsoever by or on behalf of the Lender on the Chargor(s) and any of the Security Parties.

 

 

ARTICLE XVI 

 

MISCELLANEOUS

 

SECTION 16.01        CHANGE IN LENDER

 

The securities, liabilities and/or obligations created by this Agreement
shall continue to be valid and binding for all purposes whatsoever notwithstanding any change by amalgamation, reconstruction or
otherwise which may be made in the constitution of the Lender or of any company by which the business of the Lender may for the
time being be carried on and shall be available to the company carrying on that business for the time being.

 

SECTION 16.02        CHANGE IN BORROWER(S) OR SECURITY PARTIES

 

	(a)		The securities, liabilities and/or obligations created by this Agreement shall continue
to be valid and binding for all purposes whatsoever notwithstanding any change whether by reason of amalgamation, bankruptcy,
death, insanity, incorporation, liquidation, reconstruction, winding up or otherwise howsoever in the name, style, constitution
or composition of the Borrower(s) and/or Security Parties and it is expressly declared that no change of any sort whatsoever in
relation to or affecting the Borrower(s) and/or Security Parties shall in any way affect the security liabilities and/or obligations
created by this Agreement in relation to any transactions whatsoever whether past, present or future.

 

	(b)		If the Borrower and/or Security Parties being a firm is dissolved by reason of the
introduction of a further partner or partners into the firm or the death or retirement of any existing partners from the firm
or the amalgamation of the firm with another firm or in consequence of a corporation taking over all the assets of the firm this
Agreement and/or the Security Documents shall continue and in addition to the debts and liabilities of the old firm shall apply
to all money and liabilities due or incurred to the Lender from or by the new firm or corporation as aforesaid thereby constituted
as though there had been no change in the firm as previously constituted.

 

SECTION 16.03        CHANGES IN LAW AND CIRCUMSTANCES

 

	(1)		Notwithstanding any provision to the contrary herein, in the event that, by reason
of the enactment of or the making of any change in any applicable law, regulation or regulatory requirement or in the interpretation
or application thereof or the making of any request or direction from or requirement of Bank Negara Malaysia or other fiscal or
monetary authority (whether or not having the force of law), the Lender shall be of the opinion that it has or will become unlawful
or it is otherwise prohibited or prevented for it to maintain ·or give effect to all or any of its obligations as contemplated
by this Agreement, then, notwithstanding any other provisions herein, the Lender's obligation to advance the Facilities shall
forthwith be terminated and/or as the case may be if the Facilities has been utilised the Borrower(s) shall on demand forthwith
repay the Facilities in full together with accrued interest thereon and any other amount payable hereunder to the Lender.

 

	(2)		If any change in any applicable law, regulation or official requirements or in the
interpretation or application thereof by any government authority or court or tribunal or other authority charged with the administration
thereof or compliance by the Lender with any request from Bank Negara Malaysia or any central bank or other fiscal, monetary or
other authority (whether or not having the force of law) binding upon the Lender in the jurisdiction in which it is formed or
has. its principal or lending office or in which any action is required to be performed for the purposes of this Agreement or
if any order judgement or direction or any other change in circumstances shall:-

 

	(a)		subject the Lender to any tax, deduction or withholding of any nature with respect
to the Facilities (other than taxation on gains profits or income of the Lender); or

 

 

    	26

    	 

    
 

 

	(b)		change the basis of taxation to the Lender of payments of principal, interest or other
fees in respect of the Facilities (other than taxation on gains, profits or income of the Lender); or

 

	(c)		impose, .modify or deem applicable any reserve requirements against any assets of,
deposit with or for the account of, Facilities by the Lender; or

 

	(d)		generally affect the operations or business of the Lender;

 

and the result of mw of the foregoing is to increase the cost to
the Lender of making, maintaining or funding the Facilities or to reduce the amount of any payment received or receivable by the
Lender by any amount which the Lender deems material, then and in any such case:-

 

	(i)		the Lender shall promptly notify the Borrower(s) in writing of the happening of such
event and notwithstanding anything provided in this Agreement, the Lender shall be entitled to at its sole discretion, but without
any obligation so to do, withdraw, cancel, terminate, recall or suspend the Facilities or any part thereof;

 

by the Lender as a result of or arising from such prepayment and
the cost to the Lender for having funded the Facilities up to the date the prepayment is made and on such prepayment the Facilities
shall be cancelled;

 

	(iv)		upon the Lender's receipt of the Borrower(s)' notice of prepayment and pending the
Lender's receipt of the Borrower(s)' prepayment of the Indebtedness, the Lender may at its sole discretion, but without any obligation
so to do, suspend or refuse any further drawings under the Facilities; and

 

	(v)		the certificate or confirmation of the Lender duly signed by any of its officers for
the time being as to any additional amounts payable to it pursuant to this Section shall, save for any manifest error, be final
and conclusive and shall be binding upon the Borrower(s).

 

SECTION 16.04       CONSOLIDATION AND RIGHT OF SET-OFF

 

	(a)		It is hereby expressly agreed and declared that, unless the Lender otherwise agrees,
the security created hereunder or any security whether given now or hereafter or from time to time shall not be discharged or
released except on payment of not only alimonies secured hereby but also alimonies whatsoever or howsoever owing or payable or
due from the Borrower(s) and/or the Securities Parties to the Lender (whether such liability be present, future, actual, contingent,
primary, secondary, collateral, secured or unsecured, several or joint) under any account or accounts of whatsoever nature (whether
current, deposit or loan account), agreement or contract or otherwise with the Lender.

 

	(b)		Without prejudice to any other remedies which the Lender may have, the Lender may
without notice to the Borrower(s) and/or the Security Parties and at any time or from time to time at its sole and absolute discretion
combine, consolidate or merge all or any of the Borrower(s)' and/or the Security Parties' account or accounts of whatsoever nature
(whether current, deposit or loan account), at any branch of the Lender with any liabilities of the Borrower(s) and/or the Security
Parties (whether such liability be present, future, actual, contingent, primary, secondary, collateral, secured or unsecured,
several or joint) under any account (whether current, deposit or loan account), agreement (including under this Agreement), or
contract or otherwise with the Lender and set off or transfer any sum (whether in the same or different currencies) standing to
the credit of any such account, agreement or contract in or towards the satisfaction of any of the Borrower(s)' and/or the Security
Parties' liabilities to the Lender under this Agreement and the Security Documents or under any account or accounts of whatsoever
nature (whether current, deposit or loan account), agreements or contracts or otherwise (whether such liability be present, future,
actual, contingent, primary, secondary, collateral, secured or unsecured, several or joint) and the Borrower(s) hereby expressly
covenants that all liabilities of the Borrower(s) after such consolidation shall also be secured by this Agreement and the Security
Documents.

 

    	27

    	 

    
 

SECTION 16.05        MODIFICATION AND INDULGENCE

 

The Lender may at any time and without in any way affecting the
security hereby created:-

 

	(a)		determine, vary or increase the amount of the Facilities or any part thereof or any
credit or other facility granted to the Borrower(s) and may open and/or continue any account or accounts current or otherwise
with the Borrower(s) at any branch or branches of the Lender;

 

	(b)		vary or depart from the terms and conditions governing the Facilities and/or the provisions
of this Agreement and/or the Security Documents and the Borrower(s) hereby expressly consent(s) to any and all such variations
and/or departure (howsoever substantial) if any of the following circumstances or events occur:-

 

	(i)		changes in key directors management and/or substantial shareholders of the Borrower(s)
or any Security Party; or

 

	(ii)		the Facilities or any part thereof were used for purposes other than that notified
to the Lender; or

 

	(iii)		non-compliance or any breach of the representations, terms and conditions or covenants
governing the Facilities without the Lender's prior written consent provided always the exercise by the Lender of its rights under
this subsection (b) shall not in anyway whatsoever prejudice the Lender's rights under Section 12.01 in respect of the same breach
or non compliance or any subsequent breach or non compliance.

 

	(c)		grant to the Borrower(s) or the Security Parties or any other person any time or indulgence;

 

	(d)		renew any bills, notes or other negotiable securities;

 

	(e)		deal with exchange release or modify or abstain from perfecting or enforcing any Security
Documents or rights it may now or at any time hereafter or from time to' time have from or against the Borrower(s) or any other
person;

 

	(f)		compound with the Borrower(s) or the Security Parties or any other person;

 

	(g)		vary from time to time the terms and conditions of the Facilities given herein to
comply with all relevant rules, decisions and rulings of Bank Negara Malaysia and/or the Association of Banks/Finance Companies
in Malaysia whether the same be made before or after the creation of this Agreement herein;

 

	(h)		have recourse to all or any remedies or means for recovering the monies hereby secured
which may be available for such purpose at such time and in such order and manner as the Lender may think fit.

 

SECTION 16.06        WAIVER

 

No failure or delay on the part of the Lender in exercising nor
any omission to exercise any right, power, privilege or remedy accruing to the Lender under this Agreement or any of the other
Security Documents shall impair any such right, power, privilege or remedy or be construed as a waiver thereof or an acquiescence
in such default nor shall any action by the Lender in respect of any default or any acquiescence in any such default, affect or
impair any tight, power, privilege or remedy of the Lender in respect of any other or subsequent default.

 

SECTION 16.07        SUSPENSE ACCOUNT

 

Any monies received hereunder or under any of the other
Security Documents, may be placed and kept to the credit of a suspense account for so long as the Lender thinks fit without
any obligation in the meantime to apply the same or any part thereof in or towards discharge of any money or liabilities due
or incurred by the Borrower(s) to it. Notwithstanding any such payment in the event of any proceedings in or analogous to
bankruptcy, liquidation, composition or arrangement the Lender may prove for and agree to accept any dividend or composition
in respect of the whole or any part of such money and liabilities in the same manner as if this security had not been created
and no monies or dividends so received by the Lender shall be treated as received in respect of this Agreement, but the full
amount hereby secured shall be payable by the Borrower(s) until the Lender shall have received from all sources one hundred
sen in the ringgit on the ultimate balance outstanding against the Borrower(s). After the Lender has received such ultimate
balance in full, any Claim on the part of the Borrower(s) to any excess or any securities remaining with the Lender shall be
a matter of adjustment between the Lender and the Borrower(s) and any other person or persons laying claim thereto.

 

 

    	28

    	 

    
 

SECTION 16.08        PROCEDURE ON NOTICE OF FURTHER CHARGE

 

It is hereby agreed that if the
Assignor(s) (or any one or more of them) shall execute or create any further or subsequent charge, mortgage or encumbrance
over the Said Property or any part or parts thereof in favour of any other corporation, person or persons of which the Lender
shall receive notice either actual or constructive the Lender may on receiving such notice forthwith open a new or separate
account with the Borrower(s) in its books and if the Lender does not in fact open such new or separate account the Lender
shall nevertheless be deemed to have done so at the time when the Lender received or was deemed to have received such notice
(hereinafter called the "Time Of Notice") and so as from and after the Time Of Notice all payments in account made
by the Borrower(s) (or any one or more of them) to the Lender shall (notwithstanding any legal or equitable rule of
presumption to the contrary) be placed or deemed to have been placed to the credit of the new or separate account so opened
or deemed to have been opened as aforesaid and shall not go in reduction of the amount due by the Borrower(s) to the Lender
at the Time Of Notice PROVIDED ALWAYS that nothing in this Section contained shall prejudice the security which the Lender
otherwise would have had hereunder for the payment of the monies, costs, charges and expenses herein this Agreement
referred to notwithstanding that the same may become due or owing or be incurred after the Time Of Notice.

 

SECTION 16.09        NO OBLIGATION TO MAKE FURTHER ADVANCES

 

Nothing contained herein shall be deemed to render it obligatory
upon the Lender either at law or equity to make or continue to make any advances or to afford any other accommodation or facilities
whatsoever.

 

SECTION 16.10        LIENS AND OTHER SECURITIES

 

Nothing herein contained shall prejudice or affect any lien to which
the Lender is entitled or any other securities which the Lender may at any time or from time to time hold for or on account of
the monies payable by the Borrower(s), whether secured or unsecured nor shall anything herein contained operate so as to merge
or otherwise prejudice or affect any bill, note, guarantee, mortgage or other security which the Lender may for the time being
have for any money intended to be hereby or otherwise secured or any right or remedy of the Lender thereunder.

 

SECTION 16.11        INTEREST RATE ON OTHER SECURITIES

 

When the payment of any monies hereby secured or intended so to
be shall be further secured to the Lender by any bill of exchange, promissory note, draft, receipt or other instrument reserving
a higher rate of interest to be paid in respect thereof than that hereinbefore covenanted to be paid such higher rate of interest
shall be payable in respect of such monies and nothing contained in or to be implied from these presents shall affect the right
of the Lender to enforce and recover payment of such higher rate of interest or as the case may be the difference between such
higher rate and the rate payable hereunder.

 

SECTION 16.12       PAYMENTS BY BORROWER(S)

 

The Borrower(s) shall pay all stamp duties, fees or other charges
payable on or incidental to the execution, issue, delivery, registration and enforcement of this Agreement, the Security Documents
and any documents related thereto and all legal costs and expenses in connection with or incidental to this Agreement including
the fees of the Lender's solicitors (on a solicitor and own client basis) whether or not the Facilities or any part thereof may
be aborted before utilisation by the Borrower(s) for any reason whatsoever. The Lender reserves the right to debit all such expenses
from the Borrower(s)' account(s) with the Lender. If the monies hereby secured or any part thereof are required to be recovered
through any process of law, the Borrower(s) shall pay (in addition to the monies hereby secured then due and payable) the fees
of the Lender's solicitors (on a solicitor and own client basis) and any other fees and expenses incurred in respect of such recovery.

 

 

    	29

    	 

    
 

SECTION 16.13        COSTS AND EXPENSES 

 

	(a)		All charges (including banking charges, fees, commissions which the Lender may charge
from time to time) costs and expenses in thereunder by the Lender including any expenditure incurred in the creation, preservation,
·enforcement, recovery and/or preparation of this Agreement and the Security Documents or in the giving of any notice or
in the making of any demand, under or pursuant to or in respect :of this Agreement and all other monies whatsoever paid by the
Lender in respect of the said costs, expenses. and expenditure or otherwise howsoever and all or any sums of monies paid or expended
b)'the Lender under or pursuant to the provisions of the applicable Acts, this Agreement, the Security Documents, express or implied,
shall be debited to the Borrower(s)' accounts and payable by the Borrower(s) to the Lender on demand and shall bear interest thereon
at the Default Rate or if more than one facility is granted, then at the Overdraft Default Rate at such rest period as may be
determined by the Lender from the date of the sums having been paid or expended and, such sums and interest shall on demand be
paid to the Lender by the Borrower(s) and until payment shall bear interest at the Default Rate or the Overdraft Default Rate
from the date of such monies having been paid or expended until full payment (both before and after judgment or order) and shall
be charged on the Said Property in addition to the principal sum hereby advanced.

 

	(b)		In the event of default by the Borrower(s) or any of the other Security Parties in
payment of any monies payable by the Borrower(s) or any of the other Security Parties to any person or authority whomsoever under
or pursuant to t\le provisions of this Agreement, any other Security Documents, the Sale and Purchase Agreement and/or the Principal
Sale and Purchase Agreement, it shall be lawful for (but not obligatory upon) the Lender to make such payments on behalf of the
Borrower(s) and/or any of the other Security Parties, whereupon the Lender reserves the absolute right to debit the Borrower(s)'
account(s) with all such monies expended by the Lender and the Borrower(s) shall pay to the Lender interest on such debited amount
at the Default Rate or if more than one facility is granted, then at the Overdraft Default Rate from the date of the sums having
been paid or expended and such sums and interest shall on demand be paid to the Lender by the Borrower(s) and until payment shall
bear interest at the Default Rate or Overdraft Default Rate and at such rest period as may be determined by the Lender from the
date of such monies having been paid or expended until full payment (hath before and after judgment or order) and shall be charged
on the Said Property in addition to the principal sum hereby advanced.

 

SECTION 16.14        CONSENT TO ASSIGN/TRANSFER

 

	(a)		The Borrower(s) hereby covenant(s) and agree(s) that the Lender shall be at liberty
at any time with or without notice to the Borrower(s) to assign and/or transfer all its rights, interests and obligations of this
Agreement to any person or financial institution upon such terms as the Lender shall deem fit and a statement therein of the amount
due to the Lender shall be conclusive and binding for all purposes against the Borrower(s).

 

	(b)		The Borrower(s) shall not assign the Borrower(s)' rights, interest and obligations
hereunder without the prior written consent of the Lender.

 

SECTION 16.15        CUSTODY OF DOCUMENTS

 

	(a)		The Lender shall have custody and possession of the individual/strata title in respect
of the Said Property immediately upon issuance thereof by the relevant authority.

 

	(b)		For so long as any monies shall be owing by the Borrower(s) to the Lender and during
the continuance of this Agreement, the Lender shall have the custody and possession of the Assignor(s)' original copy of the Sale
and Purchase Agreement and the Construction Agreement (if any) and of all other whatsoever documents evidencing any title to or
right in the Said Property or any benefits or rights annexed, appurtenant or relating thereto or in any way connected therewith.

 

SECTION 16.16        PAYMENT IN GROSS

 

All monies received by the Lender from any person or estate capable
of being applied in reduction of the monies hereby secured shall be regarded fur all purposes as payments in gross and if a receiving
order is made against any person liable to the Lender or an order be made or an effective resolution be passed for the winding-up
of any company liable to the Lender, the Lender may proe for the whole of the monies then owing and no money received under such
proof shall be considered as received in respect of this security but the full amount owing shall by payable until the Lender has
received from all sources one hundred sen in the ringgit and if the amount ultimately received by the Lender exceeds the amount
of the ultimate balance owing to the Lender the excess only over such ultimate balance shall be repaid to the person or party on
whose account the same hall have been received by the Lender.

 

 

    	30

    	 

    
 

 

The Borrower(s) hereby agrees that· until the Indebtedness
is fully settled, any monies (whether in the form of cash, dividends or other forms), property or assets receivable by the Lender
under Sections 16.07 or 16.16 but paid to or received by' the Borrower(s) shall be held upon trust to pay or to transfer the same
to the Lender to the extent of such Indebtedness. 

 

SECTION 16.17        INFRINGEMENT OF SECTION 62 OF THE BANKING AND
FINANCIAL INSTITUTIONS ACT, 1989

 

The Borrower(s) hereby declare(s) that the Borrower(s) has/have
had notice of Section 62 of the Banking And Financial Institutions Act, 1989 ·and confirm(s) that the said section has not
been infringed and hereby undertake(s) to• advise the Lender if any of the relationships set out in the said section is established
or discovered at any time. The Lender reserves the right to recall the Facilities in the event of any infringement of the said
section..

 

SECTION 16.18        FURTHER ASSURANCE

 

The Borrower(s) shall from time to time and at any time, whether
before or after the security constituted by this Agreement or any other Security Documents shall have become enforceable, execute
and do or cause to be executed and done all such transfer, assignments, assurances, charges, debentures, instruments, documents,
acts and things as the Lender may reasonably require for perfecting the security intended to be hereby constituted and for facilitating
the realisation of the property charged or to be charged to the Lender and the exercise by it of all the powers, authorities and
discretions hereby conferred on the Lender and the Borrower(s) shall also give all notice, orders and directions which the Lender
may think expedient. For such purposes a certificate in writing signed by or on behalf of the Lender to the effect that any particular
transfer, assignment, assurance, charge, debenture, instrument, document, act or thing required by it is reasonably required by
it shall be conclusive evidence of the fact.

 

SECTION 16.19        UNDERTAKINGS

 

(a) In consideration of:-

 

	(i)		the Lender having at the request of the Borrower(s) and/or Assignor(s) given its express
or implied undertaking or covenant to any financial institution and/or the Developer/Vendor/Contractor or their solicitors or
firm of solicitors purporting to act for the financial institution or the Developer/Vendor/Contractor, to pay;

 

	(ii)		the Lender having at the request of the Borrower(s) and/or Assignor(s) given its express
or implied undertaking or covenant to pay the Lender's solicitors to enable the solicitors to give to the financial institution
and/or the Developer/Vendor/Contractor and/or the solicitors acting for the financial institution and/or the Developer/Vendor/Contractor,
their solicitor's undertaking to pay;

 

the balance purchase price and/or the balance Construction Price
payable by the Assignor(s) under the schedule of payment set out in the Sale and Purchase Agreement and/or the Construction Agreement
or any variation in the order of payment thereof the Borrower(s) agree(s) (in addition to the Said Property being assigned as provided
herein) that the Said Property is assigned for the benefit of the Lender with the payment of all monies undertaken or guaranteed
or covenanted to be paid by the Lender to the financial institution and/or Developer/Vendor/Contractor or their solicitors and/or
the Lender's solicitors, as the case may be, and the Borrower(s) will at all times hereafter indemnify and keep the Lender indemnified
against all actions, proceedings, costs, expenses, claims and demands which may be taken incurred or suffered by the Lender arising
from the aforesaid undertaking given by the Lender to the financial institution and/or the Developer/Vendor/Contractor and/or their
solicitors and/or the Lender's solicitors.

 

	(b)		The Borrower(s) hereby agree(s) and undertake(s):-

 

	(i)		to advise the Lender immediately of any threatened, impending or existing legal proceedings
affecting the Borrower(s) or any Security Party;

 

	(ii)		that there is no change that would be detrimental to the financial standing of the
Borrower(s) or any Security Party PROVIDED ALWAYS that the Lender has the absolute discretion to decide whether a change is detrimental
or not;

 

	(iii)		·to advise the Lender immediately of any change in the financial standing
of the Borrower(s) or any Security Party.

 

 

    	31

    	 

    
 

 

SECTION 16.20        RIGHT TO DISCLOSE INFORMATION

 

The Borrower(s) hereby expressly permit(s) the Lender to disclose
to the Central Credit Bureau or such other bureau, authority or body whether or not established by Bank Negara Malaysia and without
prejudice to the generality of the foregoing to disclose to any party/person proposing or considering tendering any payment towards
the Indebtedness under the Facilities, Biro Maklumat Cek, Cagamas Bhd, Credit Guarantee Corporation, Pengurusan Danaharta Nasional
Berhad, Central Credit Reference Information System (CCRIS), the Security Parties, companies which are related to the Lender by
virtue of Section 6 of the Companies Act 1965, its auditors, lawyers or any other debt collection agents, nominees, trustee, custodians,
securities depositories or registrars, insurance companies, agents, contractors or third party service providers who are involved
in the provision of products and services to or by the Lender and its related companies any information relating to the Borrower(s)'
and/or the Security Parties' affairs or account (including the Borrower(s)'/Securities Parties' credit standing) in respect of
the Facilities this Agreement and/or the Security Documents or for provision of or cross selling of products and services, at any
time and to such extent as the Lender may at its absolute discretion deem expedient or necessary and without liability to the Borrower
and the Security Parties and the Borrower(s) expressly consent(s) to such disclosure and confirm(s) and declare(s) that no further
consent from the Borrower(s) or any of the other Security Parties is necessary or required in relation thereto.

 

SECTION 16.21        SEVERABILITY

 

	(a)		If any provision, term, condition, stipulation, covenant or undertaking of this Agreement
is or becomes illegal, void, invalid, prohibited or unenforceable in any respect the same shall be ineffective to the extent of
such illegality, voidness, invalidity, prohibition or unenforceability without invalidating in any manner whatsoever the remaining
provisions hereof.

 

	(b)		If at any time any of the Security Documents is or becomes illegal, void, invalid,
prohibited or unenforceable in any respect the same shall be ineffective to the extent of such illegality, voidness, invalidity,
prohibition or unenforceability without invalidating in any manner whatsoever the remaining Security Documents and shall not in
any way preclude the Lender from enforcing the Lender's rights and remedies vis-a-vis the other Security Documents.

 

SECTION 16.22        NO INFERENCE OF CONDONATION OR ACQUIESCENCE

 

NOTWITHSTANDING the fact that the Lender may not have exercised
any remedy available to it immediately on default by the Borrower(s) or that it may have accepted monies from the Borrower(s) or
any of the Security parties after such default the Lender shall not be held to have condoned or acquiesced in such default and
may at any time thereafter exercise all or any of the remedies available to it and any delay on the part of the Lender in taking
steps to enforce the remedies conferred on or available to it by this Agreement, the Security Documents or statute shall not be
held to prejudice its right of action in respect thereof.

 

SECTION 16.23        LEGAL INCAPACITY OF BORROWER(S)

 

Where any monies are owing and secured by this Agreement, they shall
be deemed to be so owing and so secured notwithstanding any legal limitation, incapacity or otherwise of the Borrower(s) respecting
the borrowing of the Facilities which might be a defence as between the Borrower(s) and the Lender.

 

SECTION 16.24        NO SET-OFF OR COUNTERCLAIM BY BORROWER(S)

 

	(1)		Until all monies·and liabilities due or incurred by the Borrower(s) to the
Lender shall have been paid or discharged in full, the Borrower(s) shall not by paying off any sum recoverable hereunder or by
any other means or on any other ground claim any set-off or counterclaim against the Lender in respect of any liability from the
Lender to the Borrower(s).

 

	(2)		All sums payable by the Borrower(s) under this Agreement shall be paid free and clear
of any without any deduction or witholding on account of any tax (except to the extent required by law). If (a) the Borrower(s)
or any other person is required by law to make any deduction or withholding on account of any tax or any other amount from any
sum paid or payable by the Borrower(s) or an) Security Party to the Lender under this Agreement and the Security Documents or
(b) the Lender (or any person on its behalf) or any Security Party is required by· law to make any deduction or withholding
from any payment (except on account of tax on the overall net income of the Lender) under this Agreement and the Security Documents,
the Borrower(s) shall notify the Lender of any such requirement or any change in any such requirement as soon as the Borrower(s)
becomes aware of it and shall:-

 

    	32

    	 

    
 

	(i)		by giving the Lender thirty (30) days' prior written notice, be at liberty to prepay
the Indebtedness (including any such tax or other amount) without any penalty together with the net cost to the Lender in funding
or maintaining the Facilities up to and including the date such prepayment is actually received by the Lender and with an additional
amount to be determined by the Lender at its sole and absolute discretion representing any loss (including but not limited to
any funding loss) incurred by the Lender as a result of or arising from such prepayment and on such prepayment the Facilities
shall be cancelled;

 

	(ii)		pay any such tax or other amount before the date on which penalties attach thereto,
such payment to be made (if the liability to pay is imposed on the Borrower(s) or, where applicable, any Security Party) for the
account of the Borrower(s) or such Security Party or (if that liability is imposed on the Lender) on behalf of and in the name
of the Lender;

 

	(iii)		pay such additional sum to the extent necessary to ensure that, after the making of
that deduction, witholding or payment the Lender receives on the due date and retains (free from any liability in respect of any
such deduction, witholding or payment) a net sum equal to what the Lender would have received and retained had no such deduction,
witholding or payment been required or made; and

 

	(iv)		as soon as the Borrower(s) or, where applicable, the Security Party is required by
law to do so, pay over to the relevant taxation or other authorities the full amount of the deduction or withholding which shall
have been made by the Borrower(s) or such Security Party and as soon as possible thereafter furnish to the Lender a copy of the
official receipt in respect thereof in the name of the Lender, issued by the relevant taxation or other authorities and such other
documentation as the Lender may reasonably require for the purpose of the taxation authorities of the Lender.

 

	(3)		Without prejudice to the survival of any other agreement of the Borrower(s) hereunder,
the agreements and obligations of the Borrower(s) contained in sub-sections (1) and (2) above shall survive the payment in full
of principal and interest hereunder and under any instrument delivered hereunder.

 

SECTION 16.25        SET-OFF

 

If the Said Property is put up for sale by way of auction pursuant
to the provisions herein contained or the provisions of the applicable Acts or otherwise, the Lender shall be entitled to set off
the monies due by and/or liabilities of the Borrower(s) to the Lender including all monies secured under this Agreement whether
such liability be present, future, actual, contingent, primary, secondary collateral secured or unsecured several or joint under
any account, agreement, contract or otherwise with the Lender against any monies payable by the Lender as the purchaser .at such
sale in the event of the Lender exercising its rights under this Agreement or the applicable Acts, as the case may be, to bid at
such sale.

 

SECTION 16.26        DUTY TO DELIVER VACANT POSSESSION

 

Unless with the consent of the Lender in writing, the
Borrower(s) shall not, so long as this Agreement continues in force and remains undischarged, permit any person or party
other than the Assignor(s) to be the occupier of the Said Property and in the event of the Said Property being sold at a
public auction pursuant to the provisions therein contained or an order of Court or the Land Administrator as the case may
be, the Borrower(s) shall whenever requested to do so by the Lender at the Borrower(s) and/or the Assignor(s)' own cost and
expense deliver vacant possession of the Said Property to the Lender or to such other person(s) as the Lender may direct.

 

SECTION 16.27        FORCE MAJEURE

 

Notwithstanding any other provisions herein, in the event the Lender
is unable to perform any obligations hereunder or any operations or to provide any service(s) due to any reason beyond the
Lender's control, including but not limited ·to fire, earthquake, flood, epidemic, natural catastrophe, accident, riots,
civil disturbances, industrial dispute, act of public enemy, embargo, war, act of God or any failure or disruption to telecommunication,
electricity, water, fire, supply or any factor in .a nature of a force majeure, the Lender shall not in any way be liable for
any failure on its part perform such obligations or for any inconvenience, loss, injury, damages suffered or incurred by the Borrower(s)
or any Security Party arising from the same.

 

 

    	33

    	 

    
 

 

SECTION 16.28        STATEMENT OF ACCOUNT

 

The Borrower(s) hereby expressly agree(s) that a statement of account
signed by the Manager, Assistant Manager or any other duly authorised Officer of the Lender shall be final and conclusive ,proof
..of the indebtedness of the Borrower(s).

 

SECTION 16.29        INVOLUNTARY LOSS

 

	(a)		The Lender shall not be answerable for any involuntary loss happening in or about
the exercise or execution of any power, right, privilege and remedy conferred on the Lender by this Agreement or by law.

 

	(b)		Notwithstanding anything contained in the Security Documents, the Lender shall not
be liable to the Borrower(s) or any third party for damages for default, omission, negligence, breach of contract, loss of profits
or earnings, goodwill or any type of special, exemplary, incidental, direct or consequential loss or damage howsoever arising
whether or not the Lender has been advised of the same. In the event the Lender is held liable for any damages notwithstanding
the foregoing, the total amount of the Lender's entire liability shall not exceed the principal amount of the transaction involved
which gave rise to the claim.

 

SECTION 16.30        INDEMNITY

 

	(a)		The Borrower(s) shall not do or omit or suffer to be done any act, matter or thing
in or respecting the Said Property which contravenes the provisions of the Sale and Purchase Agreement, this Agreement or any
Act, Ordinance, Enactment, order, rule, regulation or by-law now or hereafter affecting the same and the Borrower(s) shall at
all times hereafter indemnify and keep indemnified the Lender against all losses, actions, proceedings, costs, expenses, claims
and demands in respect of any such act, matter or thing done or omitted to be done in contravention of the said provisions;

 

	(b)		In addition and without prejudice to the powers, rights and remedies conferred on
the Lender herein, the Borrower(s) shall indemnify the Lender against any loss or expense (including but not limited to legal
expenses on a solicitor and own client basis) which the Lender may sustain or incur as a consequence of any default in payment
by the Borrower(s) of any sum due hereunder including (but not limited to) any interest or fees paid or payable on account of
or in respect of any funds borrowed or deposits from third parties in order to maintain the amount in default or in liquidating
or re-employing such funds or deposit;

 

	(c)		In consideration of the Lender having at the request of the Borrower(s) and/or the
Assignor(s) given its express or implied undertakings, guarantee and/or covenant to any financial institution and/or the Developer/Vendor/Contractor
or their solicitors or firm of solicitors purporting to act for the financial institution or the Developer/Vendor/Contractor or
to such other persons whatsoever to pay the balance purchase price and/or the balance Construction Price payable (or any part
thereof) by the Assignor(s) under the Sale and Purchase Agreement and/or the Construction Agreement or any variation in the order
of payment thereof either progressively or in such other manner in accordance with the terms and conditions of the Sale and Purchase
Agreement and/or the Construction Agreement the Borrower(s) agree that the aforesaid undertaking, guarantee and/or covenant whether
express or implied are given by the Lender on behalf of and for the benefit of the Assignor(s) and. the Borrower(s) will at all
times hereafter indemnify and keep the Lender indemnified against all actions, proceedings and costs suffered by the Lender arising
from the aforesaid undertaking, guarantee and/or covenant.

 

SECTION 16.31        GENERAL LIEN

 

The Borrower(s) hereby expressly and unconditionally covenant(s).
and agree(s) with the Lender that the Lender shall have a general lien over the Said Property notwithstanding that the Borrower(s)
might have at any time repaid in full the Facilities interest thereon and all monies payable to the Lender under this Agreement
and notwithstanding any Provisions to the contrary contained in this Agreement or the Strata Titles Act, 1985 or the applicable
Acts or otherwise so long as the Borrower(s) is/are still owing or indebted to the Lender whether solely or jointly with any other
person, firms or companies and whether as principal or surety at the time of full repayment of the redemption sum. Such general
lien over the Said Property shall continue to subsist and the Lender shall continue to have the custody of the documents referred
to in Section 16.15 hereof, the document of title to the Said Property if the same has been issued and the duplicate legal charge
if the Charge has then been registered, unless and until all sums owing by the Borrower(s) under such other accounts have been
fully paid or discharged to the satisfaction of the Lender. The Borrower(s) further agree(s) that a statement of account respecting
such other accounts duly signed by the Manager, Assistant Manager or any other duly authorised Officer of the Lender shall be
final and conclusive proof of the Indebtedness under such other accounts of the Borrower(s) save for manifest error. The Lender
shall not in any manner be liable or accountable to the Borrower(s), Assignor(s) and/or any other Security Patties for any loss
or damage that the Assignor(s) and/or any other Security Parties may suffer consequent upon the exercise by the Lender of its
powers herein and notwithstanding that the Assignor(s) may have sold or assigned the Said Property or in any other manner dealt
with the same which requires the release of the documents referred to in Section 16.15 hereof and the release and discharge by
the Lender of the assignment herein and the separate issue document of title to the Said Property and the duplicate of the legal
charge in respect of the Facilities as the case may be and the Borrower(s) hereby undertake(s) to indemnify and keep indemnified
the Lender against all losses, damages, costs, claims, demands and proceedings whatsoever arising from the Lender's exercise of
its powers herein.

 

    	34

    	 

    
 

SECTION 16.32        CROSS DEFAULT

 

The Lender reserves the right to proceed with legal proceedings
against the Borrower(s) or any Security Party or to recall the Facilities, interest thereon and all other monies payable to the
Lender under this Agreement or withhold or withdraw the Facilities if there is a default in the payment of any monies due by the
Borrower(s) hereunder or under any other account with the Lender or with any other financial institution or a default by any of
the Security Parties, or any related company (by virtue of Section 6 of the Companies Act) or substantial shareholder (by virtue
of Section 69D of the Companies Act) of the Borrower(s) or any Security Party under any other account with the Lender or any other
financial institution or if there is a default in the payment of any monies under the accounts of any other party of which the
Borrower(s) and/or any Security Party is/are a guarantor or when the Borrower(s) and/or any Security Party or any subsidiary or
holding company of the Borrower(s) and/or any Security Party cease(s) or threaten(s) to cease to carry on its business or a petition
is presented or a resolution passed for the winding up of the Borrower(s), any Security Party and/or any related company or substantial
shareholder of the Borrower(s) or any Security Party.

 

SECTION 16.33        VARIATION OF TERMS BY MUTUAL AGREEMENT

 

The provisions and terms of this Agreement may at any time and from
time to time be varied or amended by mutual consent of the parties hereto by means of a mutual exchange of letters or such other
means as the patties may agree upon from time to time and thereupon such amendments and variations shall be deemed to become effective
and the relevant provisions of this Agreement shall be deemed to have been amended or varied accordingly and shall be read and
construed as if such amendments and variations have been incorporated in and formed part of this Agreement at the time of execution
hereof Provided always that where any of the provisions in this Agreement or the law do permit unilateral variation or amendment
by the Lender, such validation or amendment may still be effected by the Lender unilaterally.

 

SECTION 16.34        EFFECTIVE DATE

 

The parties hereto agree that this Agreement shall come into force
on the date of this Agreement irrespective of the diverse dates upon which the parties may have each executed this Agreement respectively.

 

SECTION 16.35        APPLICABLE LAW AND JURISDICTION

 

This Agreement shall be governed by and construed in all respects in accordance with the laws of Malaysia
but in enforcing this Agreement, the Lender shall be at liberty to initiate and take actions or proceedings or otherwise against
the Borrower(s) in Malaysia and/or elsewhere as the Lender may deem fit and the parties hereto hereby agree that where·
any actions or proceedings are initiated and taken in Malaysia they shall submit to the non-exclusive jurisdiction of the Courts
of the States of Malaya or Sabah & Sarawak (as the case may be) in all matters connected with the obligations and liabilities
of the parties hereto under or arising out of this Agreement.

 

 

    	35

    	 

    
 

SECTION
16.36        ENFORCEMENT OF THIS AGREEMENT

 

This Agreement is in addition to and not in substitution of any
other rights or securities which the Lender may have from or against the Borrower(s) or the other Security Documents and may be
enforced in accordance with the terms hereof without first having recourse to any of such other rights or securities and without
taking any steps or proceedings against any other Security Parties as aforesaid.

 

SECTION 16.37        CUMULATIVE REMEDIES

 

The remedies provided herein are cumulative and are not exclusive
of any other remedies provided by law.

 

SECTION 16.38        SUCCESSORS
BOUND

 

This Agreement shall be binding upon the heirs', liquidators, receivers,
representatives, permitted assigns and successors-in-title of the Borrower(s) and enforceable by the successors-in-title and assigns
of the Lender.

 

SECTION 16.39        ENTIRE AGREEMENT

 

This Agreement, the Letters of Offer, the Schedules hereto, the
said Terms as defined in Section 16.49 and any document or instrument attached hereto integrate all the terms and conditions mentioned
herein and incidental hereto and supercede all oral negotiations and prior correspondence in respect of the subject matter hereof.

 

SECTION 16.40        CONSTRUCTION WHERE BORROWER(S) IS/ARE NOT AN
INDIVIDUAL PERSON

 

If the name of the Borrower(s) herein inserted is that of either
a firm or a limited company or other corporation or of any committee or association or other unincorporated body, any of the provisions
hereinbefore contained which are primarily and literally applicable to the case of a single and individual Borrower(s) or person
only shall be construed and take effect so as to give the Lender hereunder a security for the monies owing from that firm and every
member thereof or from the limited company or corporation or committee or association or other unincorporated body as identical
or analogue as may be with or to that which would have been given for the monies owing from a single individual if the Borrower(s)
had been a single individual and any monies shall be deemed to be so owing notwithstanding any defect informality or insufficiency
in the borrowing or other powers of the Borrower(s) or in the exercise thereof which might be a defence as between the Borrower(s)
and the Lender. In the case of a firm, this security shall be deemed to be a continuing security for all monies owing on any such
account as hereinbefore mentioned from the person or persons carrying on business in the name of or in succession to the firm or
from any one or more of such persons although by death, retirement or admission of partners or other causes the constitution of
the firm may have been in part or wholly varied. In the case of a limited company or other corporation any reference to bankruptcy
or death shall be deemed to be a reference to liquidation, winding up or other analogous proceedings and the monies owing as aforesaid
and hereby secured shall be deemed to include any monies owing in respect of debentures or debenture stock of the limited company
or other corporation held by or on behalf of the Lender.

 

SECTION 16.41        UNINCORPORATED BODY

 

In amplification to and not in derogation of any other provision
contained in this Agreement it is expressly agreed that notwithstanding that the Borrower(s) is/are a committee or association
or other unincorporated body which has no legal existence or which is under no legal liability to discharge obligations undertaken
or purported to be undertaken by 'it or on its behalf this security shall be valid and have effect as though the Borrower(s) was/were
a principal debtor. '

 

SECTION 16.41A        NOTICES OR INSTRUCTIONS FROM BORROWER

 

The Lender shall be entitled (but not bound) to rely upon and act
on the notices or instructions of the Borrower(s), whether .oral or written and whether given by telephone, post, telex, cable,
facsimile transmissions or other electronic means. Without prejudice to the generality·of the foregoing, the Lender shall
be entitled to rely and act on any notice or instructions given whether based on signatures which appear to the Lender, by reference
to the names and signatures of such persons filed with the Lender to be the signatures of: -

 

 

    	36

    	 

    
 

 

	(i)		the Borrower(s); or

	(ii)		any of the persons authorised by the Borrower(s) to issue any notice or any instructions
whatsoever on behalf of the Borrower(s),

 

or otherwise, without enquiry on the part of the Lender as to the
identity of the person givIng or purporting to give such notices or instructions or as to the authenticity of such notices or instructions
notwithstanding that it is subsequently shown that the same was not given by the Borrower(s).

 

The Lender is entitled to treat all such notices or instructions
given, as binding upon the Borrower(s) and the Lender shall be entitled (but not bound) to take such steps in connection with or
in reliance upon such communication and the risk of the notices or instructions being given by unauthorised persons, any misunderstanding
or any error, loss or delay resulting from the use of telephone, postal services, telex or teletype machines, cables devices, facsimile
transmission, devices or electronic or other means are entirely the risk of the Borrower(s).

 

The Lender shall be under no duty to enquire into the genuineness
or authenticity of the communication given to the Lender by any of the forms of communication referred above and the Lender's rights
under this Agreement shall not be affected by any misuse or unauthorised use of such communication. The Lender shall be indemnified
in full by the Borrower(s) against all losses, claims, demands, costs, damages, expenses and all other liabilities of whatever
nature which it may incur or suffer in consequence of its accepting and acting on such communication.

 

SECTION 16.42        BORROWING AND CHARGING POWERS

 

This Agreement shall continue to be valid and binding for all purposes
notwithstanding that the borrowing of the Facilities herein by the Borrower(s) or the incurring of the liabilities by the Borrower(s)
may be invalid or in excess of the Borrower(s)' power(s) to borrow the Facilities and/or the Assignor(s)' power(s) to assign or
charge the Said Property or the power of any director, attorney, partner, agent or other person purporting to act or acting on behalf
of the Borrower(s) and/or the Assignor(s) and notwithstanding any other irregularity in such borrowing or the incurring of such
liabilities.

 

SECTION 16.43       TIME

 

Time wherever mentioned shall be of the essence of this Agreement.

 

SECTION 16.44       THIS AGREEMENT TO PREVAIL

 

In the event of any inconsistencies between the terms and conditions
of this Agreement and the terms and conditions of other Security Documents, the terms and conditions herein shall prevail.

 

SECTION 16.45        APPLICATION OF PAYMENTS

 

Notwithstanding any other provisions contained in this Agreement
to the contrary, the Lender is entitled to apply any payments received from the Borrower(s) or from any person making payments
on behalf of the Borrower(s) (irrespective of whether the purpose of the payment is specified or not) towards satisfaction in whole
or part of any amount of principal, interest (including late payment interest) or other sums of monies then due and payable from
the Borrower(s) under this Agreement in any order that the Lender in its absolute discretion deems fits.

 

SECTION 16.46        AVOIDANCE OF PAYMENTS

 

No assurance, security or payment which may be avoided under any
law relating to winding up or insolvency and no release, settlement or discharge given or made by the Lender oh the faith of any
such assurance, security or payment, shall prejudice or affect the Lender's rights to recover from the Borrower(s) and/or the Assignor(s)
the monies hereby secured to the full extent hereunder. Any such release, settlement or discharge shall be deemed to be made subject
to the condition that it will be void if any payment or security which the Lender may previously have received or may hereafter
receive from any person in respect of the monies hereby secured is set aside under any applicable law or proves to have been for
any reason invalid.

 

    	37

    	 

    
 

SECTION 16.47        UPSTAMPING

 

In the event that the total monies advanced to or due and owing
by the Borrower(s) to the Lender (including accrued interest, commission, banker's charges, legal and other costs, charges and
expenses) shall at any time exceed the principal limit for which this Agreement is for the time being stamped, the Lender shall
have the right at any time without prior notice or reference to the Borrower(s) to upstamp this Agreement from the date of the
same having been paid or expended by the Lender and until payment shall form part of the monies secured by this Agreement and the
Security Documents.

 

SECTION 16.48        ADDITIONAL TERMS AND CONDITIONS

 

The Letters of Offer, the additional covenants, conditions, confirmation
and declarations set out in the Second Schedule, the negative covenants set out in the Third Schedule, the additional terms and
conditions for Trade Facilities and Overdraft set out in the Fourth Schedule and the said Terms as defined in Section 16.49 shall
form and be construed as part of this Agreement and shall prevail in the event of any conflict or discrepancies with the other
provisions of this Agreement.

 

SECTION 16.49        ADDITIONAL, INTERCHANGE OR SUBSTITUTION OF FACILITIES

 

The Lender may at any time or from time to time in its absolute
discretion and without affecting the Lender's security, at the request of the Borrower(s) and/or the Assignor(s) grant additional
or further facilities, vary, interchange or substitute the Facilities or any of them hereby granted with any other facilities including
converting any facilities upon such terms and conditions (hereinafter called "the said Terms") as may be stipulated in
the Lender's Letters of Offer and/or any other document setting out such terms duly signed by the Borrower(s) in acceptance thereof,
and all the provisions of this Agreement and the Security Documents, save and except such provisions which are inconsistent with
the said Terms or not applicable to the additional, interchanged or substituted facilities, as the case may be shall Secure such
further or interchanged or substituted facilities, unless otherwise stipulated by the Lender.

 

SECTION 16.50        PRINCIPAL AND SECONDARY INSTRUMENTS

 

IT IS HEREBY AGREED AND DECLARED THAT this Agreement, the Assignment,
the Charge, the Power of Attorney, the Guarantee (if any) and the other Security Documents are instruments employed in one transaction
to secure such principal sum as provided under the Letters of Offer, together with all interest thereon and all monies and liabilities
covenanted and agreed to be paid by the Borrower(s) and the Security Parties under or in connection with or arising from the Facilities
granted by the Lender at any time and from time to time within the meaning of Section 4(3) of the Stamp Act, 1949, and for the
purpose of the said Section, this Agreement is deemed to be the primary or principal instrument and the Assignment, the Power of
Attorney, the Charge, the Guarantee (if any) and the other Security Documents are deemed to be the auxiliary or secondary instruments.

 

SECTION 16.51        INDEPENDENT LEGAL ADVICE

 

The Borrower(s) hereby confirms and represents to the Lender that
in the execution and delivery of the Letters of Offer and the Security Documents, the Borrower(s) has sought and obtained and relied
upon its own independent advice and judgement and has not relied upon any representation statement or advice from the solicitors,
agents or officers of the Lender and the Borrower(s) acknowledge(s) that the Lender has accepted and entered into this Agreement
and the Security Documents in full reliance upon the aforesaid confirmation and representation.

 

 

    	38

    	 

    
 

 

    	39

    	 

    
 

 

 

 

    	40

    	 

    
 

THE SECOND SCHEDULE

 

ADDITIONAL COVENANTS, CONDITIONS, CONFIRMATIONS

AND DECLARATIONS

 

 

 

The Borrower(s) hereby covenant(s) with the Lender that it shall
at all times during the continuance of the Facilities:-

 

	(a)		where the Borrower(s) is a corporation or firm, it shall:-

 

	(i)		submit to the Lender its audited accounts within six (6) months after each financial
closing and its unaudited accounts within sixty (60) days from the end of each half year;

 

	(ii)		forthwith notify the Lender of any changes on its major shareholders and/or management;
and

 

	(b)		forthwith notify or cause to be notified to the Lender of the occurrence of any Event
of Default of any event of default in relation to other indebtedness of the Borrower(s) which in its reasonable opinion might
adversely affect its ability to comply with its obligations hereunder.

 

	(c)		obtain the prior written consent of the Lender:-

 

	(i)		before initiating, commencing, instituting or maintaining any action, suit or proceedings
whatsoever in any court or tribunal against the Developer/the Vendor/the Contractor and/or any other person in respect of any
matter arising out of the Sale & Purchase Agreement, the Construction Agreement or relating to the Said Property; and

 

	(ii)		before agreeing with the Developer/the Vendor/the Contractor on any variation or
amendment whatsoever of the tem1s of the Sale and Purchase Agreement and/or the Construction Agreement or the termination, rescission,
cancellation or revocation of the Sale and Purchase Agreement, the Construction Agreement or any matter affecting the Said Property.

 

In
addition to and without derogating the Lender's rights under the Security Document, the Borrower(s) shall forthwith pay all sums
received or payable on tem1ination or rescission of the Sale and Purchase Agreement and/or the Construction Agreement to the Lender
and pending such payment shall hold such sums in trust for the Lender.

 

    	41

    	 

    
 

THE THIRD SCHEDULE

NEGATIVE COVENANTS

(Applicable only where the Borrower(s) is
a corporation/firm)

 

The Borrower(s) hereby covenant(s) with the Lender that it shall
not during the continuance of the Facilities without the Lender's prior written consent (which consent shall not be unreasonably
withheld):-

 

	(a)		grant any loans or guarantee any person except for normal trade credit or trade guarantees
in the ordinary course of business;

 

	(b)		incur, assume or permit to exist any indebtedness or loans except:-

 

	(i)		those already disclosed in writing and consented by the Lender and subject to the
amount outstanding at all times and at any time hereafter not exceeding the amount so disclosed at the date hereof; and

 

	(ii)		unsecured indebtedness incurred in the ordinary course of business of the Borrower(s);

 

	(c)		create or permit to subsist any encumbrance, mortgage, charge, pledge, lien, right
of retention, right of set off or any other security interest over any of its present or future assets, business or undertaking
except:-

 

	(i)		liens arising in the ordinary course of business or by operation of law; and

 

	(ii)		security interests existing at the date hereof provided the same has been disclosed
to the Lender prior to the date hereof and subject to the amount outstanding and secured thereby at all times and at any time
hereafter not exceeding the amount so disclosed at the date hereof.

 

	(d)		effect or permit any form of merger, reconstruction, consolidation, amalgamation or
reduction in share capital or otherwise approve or permit any change of its ownership or control;

 

	(e)		sell, transfer, dispose or lease all or a substantial part of its assets, business
or undertaking and the assets of its subsidiaries except in the ordinary course of its business, on ordinary commercial terms
and on arm's length basis;

 

	(f)		declare any dividends in excess often per cent (10%) of its paid up capital or any
amount in excess of fifty per cent (50%) of its annual net income after tax provided always any such permissible declaration of
dividends may only be made if debt servicing is current;

 

	(g)		repay advances (if any) made by its shareholders, directors, or related or associated
companies until all monies due to the Lender have been fully repaid;

 

	(h)		enter into profit sharing or other similar arrangement whereby the Borrower(s)' income
or profits are shared with any other person or company unless such arrangement is entered into in the ordinary course of business
on ordinary commercial terms and on arm's length basis, or enter into any management agreement whereby its business is managed
by a third party.

 

Save and except for the banking and other credit facilities and
securities proffered by the Borrower(s) for such facilities which have been disclosed to the Lender, the Borrower(s) hereby declares
that there is no other charge whether fixed or floating or other encumbrance over any of its movable and immovable properties and
other assets whatsoever.

 

If in breach of its covenants herein the Borrower(s) creates or
permits to arise or subsist any encumbrance, mortgage, charge, pledge, lien, right or retention, right of set off or any other
security interest on the whole or any part of its present or future assets, all its liabilities and obligations to the Lender under
the Facilities shall be automatically and immediately secured upon the same assets equally and rateably with the other obligations
secured thereon and the Borrower(s) will upon·request by the Lender execute in favour of the Lender all such agreements
and documents containing sue terms and conditions as the Lender may require to evidence and confirm the security in its favour.

 

    	42

    	 

    
 

 

THE
FOURTH SCHEDULE

ADDITIONAL TERMS AND CONDITIONS FOR TRADE
FACILITIES AND OVERDRAFT

 

Letters of Credit Facility ("LC Facility")

and Trust Receipt Facility ("TR Facility")

 

 

	1.		The Borrower(s) may, subject to the provisions of this Agreement and the relevant
Letters of Offer, request the opening of letters of credit by the Lender. The commission payable by the Borrower(s) on each letter
of credit opened by the Lender for the account of the Borrower(s) under the LC Facility shall be payable upon the issue or opening
of the respective letter of credit by the Lender or within such other period as the Lender may at its sole and absolute discretion
deem fit and in any event, forthwith upon the Lender's demand.

 

	2.		Application for the opening of any letter of credit under the LC Facility shall be
made by delivering to the Lender a duly completed and executed LC Application in respect of such letter of credit, such LC Application
to be in the form, term and manner required by the Lender in accordance with its usual practice for the time being. The Lender
may refuse any LC Application which is not in all respects satisfactory to the Lender.

 

	3.		As against the Borrower(s), any LC Application shall be irrevocable once delivered
to the Lender.

 

	4.		No letter of credit will be opened by the Lender under the LC Facility having an expiry
date later than the expiry date of the LC Facility. Letters of Credit may be issued for amounts payable in, or determined by reference
to, currencies other than Ringgit Malaysia if the Borrower(s) so request(s), unless the Lender determines that such issue is not
practicable.

 

	5.		No letter of credit will be opened if, following its opening, the aggregate of all
the sums outstanding in respect of the LC Facility or the trade facilities of which the LC Facility forms a part thereof would
exceed the aggregate limit prescribed by the Lender or any sub-limits specifically imposed by the Lender for the LC Facility and/or
the TR Facility or the trade facilities unless the Lender shall agree to the contrary.

 

	6.		The Lender shall· at all times be entitled, without further investigation or
enquiry, to make a payment under a letter of credit if it has received a demand for payment thereunder in accordance therewith
and need not concern itself with the propriety of any claim made thereunder and in the manner required by the terms thereof; accordingly
it shall not be a defense to any claim made on the Borrower(s) hereunder which is attributable· to the making of any such
payment, nor shall the Borrower(s)' obligations hereunder be impaired or affected by the fact (if it be the case) that the Lender
might have been justified in refusing to pay the whole or part of the amount so paid.

 

	7.		The Borrower(s) shall take no step to prevent the Lender making a payment under the
letter of credit for which a demand has been made in accordance therewith.

 

	8.		Payment by the Lender of an amount under any letter of credit shall constitute an
Advance by it to the Borrower(s) of the amount so paid (or, if such amount is denominated in another currency, the equivalent
thereof in Ringgit Malaysia as notified by the Lender to the Borrower(s)), which Advance, the Borrower(s) shall (where a TR Facility
is not made available to it), be obliged to repay immediately it arises (notwithstanding that demand for repayment thereof may
not have been made on the Borrower(s)) failing which the Lender shall be entitled to all rights under this Agreement upon such
default, including payment of interest thereon at the applicable Default Rate (both before as well as after judgement or order).

 

	9.		The Borrower(s) may, subject to the provisions of this Agreement and the relevant
Letters of Offer, refinance its obligations in respect of any letter of credit issued by the Lender by utilizing the TR Facility
to issue a trust receipt before the date upon which the Lender is required to make payment under a related letter of credit in
such manner and upon such terms and conditions as the Lender may from time to time prescribe at its discretion. Unless otherwise
allowed by the Lender, the TR Facility shall be restricted to bills drawn under the .LC facility.

 

	10.		The financing tenor of the trust receipts under the TR Facility shall not exceed one
hundred and twenty (120) days or other such period, as the Lender may at its sole and absolute discretion prescribe.

 

    	43

    	 

    
 

	11.		The interest payable by the Borrower(s) to the Lender under the TR Facility for the
tenor of the trust receipt shall be payable on the respective maturity date of the trust receipts failing which, the Lender shall
be entitled to all rights under this Agreement upon such default, including payment of interest thereon at the. applicable Default
Rate (both before as well as after judgement or order). The Borrower(s) shall pay all charges incurred or to be incurred by the
Lender in connection with or arising from the TR Facility.

 

	12.		No utilization of the TR Facility will be permitted if, following such utilization,
the aggregate of all the sums outstanding in respect of the TR Facility or the trade facilities of which the TR Facility forms
a part thereof would exceed the aggregate limit prescribed by the Lender or any sub-limits specifically imposed by the Lender
for the LC Facility and/or TR Facility or the trade facilities unless the Lender shall agree to the contrary.

 

	13.		Subject to the aforesaid provisions being complied with, upon the Lender's receipt
of a trust receipt, the Lender shall on or before the date of demand, pay all sums demanded pursuant .to the relevant letter of
credit and such payment shall constitute an Advance by the Lender to the Borrower(s) of the amount so paid and the Borrower(s)
shall be obliged to repay the Advance within the time prescribed by the Lender.

 

	14		In the event that the Borrower(s) should fail to settle and repay to the Lender punctually
on due date any amounts payable by the Borrower(s) to the Lender under or in connection with or arising from the TR Facility,
then without prejudice and in addition to any other rights or remedies which the Lender may be entitled to, the Lender may, at
its sole and absolute discretion and without any obligation whether at law or in equity so to do, debit the Borrower(s)' current
account or overdraft account with the Lender (if the Borrower(s) maintains a current or overdraft account with the Lender) with
such overdue amount together with interest thereon at the applicable Default Rate (both before as well as after judgement or order)
and the Borrower(s) hereby irrevocably and unconditionally consents to the Lender so doing.

 

	15.		The LC Facility and the TR Facility shall be subject to such other terms and regulations
as may be prescribed from time to time by the Lender at its sole and absolute discretion and the Borrower(s) hereby irrevocably
and unconditionally agree(s) to accept, abide and be bound by such terms and regulations.

 

	16.		The Borrower(s) shall indemnify and keep the Lender indemnified against any damages,
losses, costs and/or expenses which the Lender may incur or suffer as a result of its grant of the LC and/or the TR Facility to
the Borrower(s).

 

	17.		If the Lender endorses to the Borrower(s)' order an Airway Bill/Parcel Post Receipt
or similar document, the Borrower(s) agree(s) that the Lender shall have no obligation to examine any shipping documents related
to the goods covered by such Airway Bill/Parcel Post Receipt in order to determine whether any discrepancies may exist between
the shipping documents received and those called for by the relative letter of credit and the Borrower(s) shall indemnify and
keep the Lender indemnified from and against any damages, losses, costs and/or expenses which the Lender may incur or sustain
or be liable to arising from the Lender's action in doing so. The Borrower(s) shall disregard all discrepancies (if any) between
the shipping documents and those called for by the relative letter of credit and shall accept all such documents as if that were
all and the only documents called for by the relative letter of credit. Further the Borrower pay to Lender in full upon demand
any monies in respect thereof due to the Lender

 

    	44

    	 

    
 

Shipping Guarantee Facility ("SG Facility")

Bank Guarantee Facility ("BG Facility")

 

 

	1.		Subject to the terms of this Agreement and the relevant Letters of Offer, the Borrower(s)
may request the issuance of shipping guarantees under the SG Facility and/or bank guarantees under the BG Facility to any party
acceptable to the Lender as beneficiary or beneficiaries by delivering to the Lender a duly completed and executed issue Request
in respect of each shipping or bank guarantee to be issued, such Issue Request to be in the form, term and substance prescribed
by the Lender from time to time and, as against the Borrower(s), such Issue Request shall be irrevocable once delivered to the
Lender.

 

	2.		Each Issue Request shall be accompanied by such contracts or other documents relevant
to the Request as the Lender may at its sole and absolute discretion request from time to time.

 

	3.		Any shipping or bank guarantee to be issued by the Lender at the Borrower(s) request
shall be in such form and substance and shall contain such terms as the Lender may at its sole and absolute discretion deem fit.

 

	4.		The tenor of any shipping or bank guarantee issued by the Lender pursuant to the SG
Facility or the BG Facility shall be for such tenor as the Lender may at its sole and absolute discretion deem fit.

 

	5.		The Borrower(s) shall pay to the Lender commission at the rate stipulated by the Lender
on each shipping or bank guarantee issued by the Lender from time to time for the account of the Borrower(s) and such payment
shall be made upon the issue of the guarantee. There shall be no refund by the Lender of any commission paid by the Borrower(s)
to the Lender upon any early cancellation or release or premature return of any shipping or bank guarantee. The Borrower(s) agree(s)
that commission shall be payable f9r the duration of the guarantee period including the period from the expiry of the guarantee
up to the date of return of the guarantee for cancellation or receipt by the Lender of confirmation from the beneficiary that
the Lender is no longer liable under the guarantee. Where there is a claims period in the bank guarantee, commission shall be
payable for the duration of the guarantee period up to the expiry of the claims period.

 

	6.		No shipping or bank guarantee shall be issued by the Lender if, following such issue,
the aggregate of all the sums outstanding in respect of the SG Facility and/or the BG Facility or the trade facilities of which
the SG Facility and/or the BG Facility forms a part thereof would exceed the aggregate limit prescribed by the Lender or any sub-limits
specifically imposed by the Lender for the SG Facility and/or the BG Facility or the trade facilities unless the Lender shall
agree otherwise.

 

	7.		If the beneficiary or any of the beneficiaries, as the case may be under any shipping
or bank guarantee shall demand any amount under any shipping or bank guarantee issued hereunder or in the event that the Lender
is required to make or has made payment under any shipping or bank guarantee issued under the SG Facility or the BG Facility,
the Lender may at any time demand payment from the Borrower(s) hereunder and the Lender shall forthwith be paid by the Borrower(s)
in full for the amount so demanded together with interest thereon at the applicable Default Rate (both before as well as after
judgement or order).

 

	8.		The Lender shall as soon as practicable endeavour to notify the Borrower(s) of any
notice or demand for payment served on it by the beneficiary or any of the beneficiaries, as the case may be, under any shipping
or bank guarantee hereunder PROVIDED ALWAYS that any failure or delay on the part of the Lender to give such notice to the Borrower(s)
in accordance with the provisions hereof shall not exempt the Borrower(s) from its obligations to indemnify and reimburse the
Lender or to pay interest thereon.

 

	9.		The Borrower(s) shall on demand by the Lender as aforesaid reimburse the Lender any amount
                                                                             paid by the Lender to the beneficiary or any of the beneficiaries, as the case may be, under or pursuant to any shipping or
                                                                             bank guarantee issued hereunder and hereby undertakes to indemnify and hold harmless the Lender against all costs, losses,
                                                                             damages, fees and expenses which the Lender
                                                                             may                                                                                                               incur
                                                                             or                                                                              sustain by
                                                                             reason                                                                                                           or in
                                                                             any way                                                                              arising in
                                                                             connection with                                                                                                 any shipping
                                                                             or bank guarantee issued
                                                                             hereunder.                                                                               Notwithstanding
                                                                             the aforesaid and for purpose                                                                               of clarification
                                                                             it is hereby expressly agreed and declared that "nothing herein contained shall be construed so as to
                                                                             render it obligatory upon the Lender to first make payment under any shipping or bank guarantee issued hereunder, and
                                                                             thereafter seek reimbursement from the Borrower(s), and it is hereby further agreed and declared that the Borrower(s)'
                                                                             obligations herein and under the SG Facility and the BG Facility, is to forthwith pay to the Lender the amount demanded by
                                                                             the Lender immediately upon the Lender's demand irrespective of whether or not the Lender has made or has yet to make
                                                                             payment                                                                              under any shipping or bank guarantee
                                                                             issued under or pursuant to the SG Facility or the BG Facility.

 

 

    	45

    	 

    
 

	10.		The Borrower(s) agree(s) that it shall remain liable to the Lender on any shipping
or bank guarantee issued hereunder until the Lender is released from liability by the beneficiaries, as the case may be, named
in such shipping or bank guarantee or, in the event of any shipping or bank guarantee issued hereunder being enforced until the
Borrower(s) had paid in full all amounts due hereunder, whichever is the later.

 

	11.		The Borrower(s) acknowledge(s) and agree(s) that the Lender's obligation under any
shipping or bank guarantee issued hereunder is absolute and unconditional and requires payment to the beneficiary or beneficiaries,
as the case may be, named in such shipping or bank guarantee upon first written demand thereof by the beneficiary or beneficiaries,
as the case may be, named in such shipping or bank guarantee notwithstanding any objection on the part of the Borrower(s). The
Lender shall at all times be entitled to make any payment under the shipping or bank guarantee upon demand by the beneficiary
or beneficiaries, as the case may be, named in such shipping or bank guarantee without further investigation or enquiry and need
not concern itself with the propriety of any claim made under or in the manner required under the shipping or bank guarantee.
The Borrower(s) hereby acknowledge(s) and confirm(s) that it shall not be entitled whether at law or in equity to stop or to demand
the Lender to withhold any payment which is to be made by the Lender under or pursuant to the shipping or bank guarantee issued
hereunder. Accordingly, the Lender shall be entitled to be reimbursed and indemnified and it shall not be a defense to any demand
made on the Borrower(s) that the Borrower(s) or the Lender was or might have been justified in refusing payment in whole or in
part of the amounts so claimed by the beneficiary or beneficiaries, as the case may be,-named in such guarantee.

 

	12.		In the event that the Lender shall be required to make any payment under or pursuant
to or arising from any shipping or bank guarantee issued by the Lender pursuant to the SG Facility or the BG Facility, the Borrower(s)
shall pay interest to the Lender at the applicable Default Rate (both before as well as after judgement or order and irrespective
of whether or not the banker customer relationship exists or subsists or has been terminated) on all monies paid by the Lender
commencing from the date such monies are first paid out by the Lender up to the date of the Lender's actual receipt of the full
amount thereof from the Borrower(s).

 

	13.		The Lender shall not be under any obligation (whether at law or in equity) to issue
any shipping or bank guarantee and the Lender may at its sole and absolute discretion refuse to issue any shipping or bank guarantee
without any obligation to give any reasons.

 

	14.		Subject to the terms and conditions of this Agreement and the relevant Letters of
Offer and subject to the limits or sub-limits imposed by the Lender in respect of the BG Facility or SG Facility not being exceeded
and provided that there are no breaches of any of the terms contained herein and no Event of Default having occurred, any shipping
or bank guarantee may at the Lender's sole and absolute discretion and at the request of the Borrower(s) communicated and delivered
to the Lender not later that fourteen (14) Business Days prior to the expiry of such guarantee be renewed and have its expiry
date extended for such further. duration and upon such terms and conditions as the Lender may at its sole and absolute discretion
deem fit including the payment of commission for such renewal at the rate stipulated by the Lender.

 

	15.		Without prejudice and in addition to any other rights or remedies which the Lender"
may be entitled to, the Lender may, at its sole and absolute discretion and without any obligation whether at law or in equity
so to do, debit the Borrower(s)' current account or overdraft account with the Lender (if the Borrower(s) maintain(s) a current
or overdraft account with the Lender) with any unpaid commission, interest or bank charges and the Borrower(s) hereby irrevocably
and unconditionally consent(s) to the Lender so doing.

 

	16.		The SG Facility and the BG Facility shall be subject to such other terms and regulations
as may be prescribed from time to time by the Lender at its sole and absolute discretion and the Borrower(s) hereby irrevocably
unconditionally agree(s) to accept, abide and be bound by such terms and regulations.

 

    	46

    	 

    
 

	17.		The Borrower(s) shall indemnify the Lender and keep the Lender indemnified against
any damages, losses, costs and expenses which the Lender may suffer or incur as a result of its grant of the SG facility and/or
the BG Facility to the Borrower(s).

 

Forward Exchange
Contract Facility {"FEC Facility")

 

	1.		The Borrower(s) may, subject to the provisions of this Agreement and the relevant
Letters of Offer, buy or sell foreign currency at a forward rate under the FEC Facility. The availability of the FEC Facility
shall be subject to the prevailing foreign exchange market rates and availability of the currency requested by the Borrower(s),
and shall be governed by the laws of Malaysia including but not limited to legislation on exchange control.

 

	2.		Prior to entering into a foreign exchange contract and unless the Lender should agree
otherwise, the Borrower(s) must satisfy the Lender that the Borrower(s) is/are due to pay or receive foreign currency to or from
a third party under a firm commercial contractual commitment. The Borrower(s) shall also open a current account ("Current
Account") with a branch of the Lender.

 

	3.		The Borrower(s) confirm(s) that having regard to the fluctuations in the exchange
rates and having given due consideration to its own objectives, financial situation, needs and risks it has formed the opinion
that dealing in FECs is suitable for the Borrower(s) and in its best interests.· The Borrower(s) acknowledge(s) that each
FEC has been or will be entered into in reliance only upon its own judgement. The Lender does not hold itself or any of its dealers
or other employees out as advising the Borrower(s) as to whether it should enter into FECs or as to any subsequent action and
the Lender shall have no responsibility or liability whatsoever to the Borrower(s) in respect of any advice or views expressed
by it or any of its dealers or employees, whether or not such advice or views was given at the request of the Borrower(s) or its
Authorised Person (as defined in Clause 5 below).

 

	4.		The FEC Facility shall be secured to the extent of ten percent (I 0%) or such other
percentage of the aggregate limit of the FEC Facility as may be determined by the Lender at its absolute discretion and shall
be subject to the terms and conditions herein and such other terms and regulations as may be prescribed from time to time by the
Lender at its sole and absolute discretion and the Borrower(s) hereby irrevocably and unconditionally agree(s) to accept, abide
and be bound by all such terms and regulations.

 

	5.		The Borrower(s) shall submit to the Lender a list of persons ("Authorised Persons")
authorised by the Borrower(s) via resolutions of its board of directors to deal in forward foreign exchange contracts ("FECs").
Changes to the Authorised Persons shall be notified to the Lender and shall only be effective on the Lender upon receipt by the
branch where the Current Account is maintained ("the Branch") of notice of such change together with any other document
that the Lender may require to evidence such change.

 

	6.	(a)	All FEC dealings between the Lender and the Authorised Person of the Borrower(s)
shall be conducted by telephone or such other mode, as may be stipulated by Lender. Once the terms of the FEC (i.e. the forward
exchange rate, the amount of foreign currency and the duration of the FEC) have been agreed between the Lender and the Authorised
Person, a contract shall be deemed concluded at that time and the contract shall be irrevocable and binding on the Borrower(s)
and the Lender. The Borrower(s) shall honour the contract on the date ("the Maturity Date") ·in which Borrower(s)
is contractually obliged to settle its obligation under the FEC, failing which the Borrower(s) shall be liable to the Lender and
shall indemnity the Lender for all costs (including legal costs on a full indemnity basis), expenses loss and damage suffered
by the Lender as a result of such failure by the Borrower(s) to honour the contract or any part of the contract.

 

	(b)	(i)	A confirmation advice on the FEC concluded will be faxed to' the Borrower(s).
A ny discrepancies noted in the confirmation advice must be conveyed by the Borrower(s) to the Branch immediately but in
any event no later than 3.00 p.m. on the Business Day immediately following the date of the faxed confirmation advice, failing
which the confirmation advice will be deemed correct and conclusive against the Borrower(s).

 

		(ii)	The original of the confirmation advice will be posted to the Borrower(s) for acknowledgment
and records. The acknowledgment copy of the confirmation advice shall be returned to the Branch within fourteen (14) days from
the date of the confirmation advice.

 

 

    	47

    	 

    
 

		(iii)	Notwithstanding anything contained in this Clause 6, the Lender's right and remedies
under the contract concluded in manner set out in Clause 6(a) above, shall not be affected or prejudiced in any manner whatsoever
by any omission or failure or delay by the Lender or the Borrower(s) to follow the procedures stated in this Clause 6(b)(i) to
(iii).

 

	7.	(a)	Without prejudice
to the generality
of the foregoing,
the Lender shall
be entitled to rely
and act on any notice or instructions based on signatures which appear to the Lender, by reference to
the names and signatures of such persons filed with the
Lender, to be the signatures of:-

 

	(i)		any of the Borrower(s)' Authorised
Persons; or

 

	(ii)		any of the persons authorised by the
Borrower(s) to issue any notice (including the notice on changes in Authorised
Person) or any instructions whatsoever,

 

without enquiry on the
part of the Lender as
to the identity
of the person giving
or purporting to give such notice
or instructions or as to the authenticity of such
instructions or notice. The Lender is entitled
to treat all such instructions or notices given, as binding upon the Borrower(s) and the Lender shall be
entitled (but not bound) to take such steps in connection with or
in reliance upon such communication.

 

	(b)		The Borrower(s) agree(s) that the
Lender shall be
in no way responsible for any misuse or unauthorised use of
message or instruction given to the Lender by telephone,
facsimile, mail or despatch or by any other means of communication and that
the Lender shall be under no duty to inquire
into the authenticity of the messages or
instructions sent or communicated by any means or the
identity of the caller.

 

	8.	(a)	Where the Borrower(s) require(s) an extension of an FEC or any part thereof, the Borrower(s)
shall inform the Lender in writing not
later than 11.00 a.m. on the relevant Maturity
Date stating its reasons for requiring an extension.

 

	(b)		The Lender reserves the absolute right
to grant or reject the Borrower(s)' request
for an extension without assigning any reason for the same and without being liable to the Borrower(s) for any expenses, loss
and damages incurred or .suffered by the Borrower(s) which may result from such refusal.
If the Lender grants the Borrower(s)' request
for an extension of an FEC or any part
of an FEC, a new FEC shall be
deemed to have been entered into between the Lender and the Borrower(s)·at
that time and all these Terms and Conditions shall
mutatis mutandis apply to the
new FEC. The new FEC shall be extended
at the Prevailing Market Rate. Prevailing Market Rate is the prevailing buying or selling
spot rate for a sale or purchase contract
quoted by the Lender on that day. If the FEC is extended or
rolled over on its Maturity Date at the historical rate, the resulting
funding costs shall be indenmified to the Lender by the Borrower(s). Such funding
costs shall be incorporated into the rate for the
extended FEC and is computed in
accordance with the following formula:-

 

 

 

whereby:-

 

	C		means the Prevailing Market Rate;

	H		means the Historical Rate;

	R		means the prevailing funding rate which is quoted by the Lender at its sole and absolute
discretion in funding the extension;

	T		means the number of days the FEC is extended.

 

 

    	48

    	 

    
 

		(c)	If ·on extension or rollover of the maturing FEC at the Prevailing Market Rate
the Borrower(s) make(s) a gain, the Prevailing Market Rate for the new FEC may at the Borrower(s)' discretion be adjusted downwards
to take into account the gains or paid into the Borrower(s)' current account ("the Current Account") provided there
are no outstanding sums owing by. the Borrower(s) on any other FECs or under any facilities to the Lender. Where the Borrower(s)
incur(s) a loss, the loss will be debited to the Borrower(s)' account.

 

	9.	(a)	If the Borrower(s) fail(s) to take up or honour the FEC or does not request
for an extension of the FEC (which the Lender may grant or reject at its absolute discretion), by 11.00 a.m. on the relevant Maturity
Date, the Lender reserves the right to close out the relevant FEC at the Prevailing Market Rate on the Maturity Date or on any
other day as the Lender may determine at its absolute discretion by notice to the Borrower(s) and debit the resulting loss or
credit the resulting gains, as the case may be, and any other costs and expenses incurred into the Current Account without further
notice to the Borrower(s).

 

		(b)	The Lender is under no obligation to call or send reminders to the Borrower(s) prior
to the maturity of any FEC.

 

	10.	(a)	Where the resulting losses are debited into the Current Account and the Current
Account does not have sufficient funds to settle such losses, the Borrower(s) shall pay the Lender interest on such outstanding
losses from the date such amounts are debited into the Current Account until the date of full payment and settlement at the rate
of 2.5% per annum or such other rate as may be stipulated by the Lender above the Lender's Base Lending Rate at its absolute discretion
(both before as well as after demand judgement or order), as agreed liquidated damages.

 

		(b)	In addition to and without prejudice to any other rights and remedies of the Lender
conferred in these Terms and Conditions or in any other agreement between the Lender and the Borrower(s), in the event of a demand
by the Lender for payment of all monies (whether principal or interest, including capitalised interest) owing by the Borrower(s)
to the Lender under the FEC Facility or recall of the FEC Facility, the Borrower(s) shall pay interest on any overdue amount or
any other sums payable to the Lender in the currency in which such amount are denominated, from the time of demand or recall up
to the time of actual payment at the rate of one per cent (I%) per annum or such other rate as may be stipulated by the Lender
above the Lender's then prevailing prescribed rate for overdraft facility, at its absolute discretion as agreed liquidated damages
calculated from the date of such demand, or recall, as the case may be, until the date of full payment (both before as well as
afterdemand, judgement or order).

 

	11.		The Lender shall be entitled to monitor the exposure of the Borrower(s) by (i) marking
to market the Outstanding Position of the Borrower(s) on a daily basis or from time to time as the Lender may determine at its
absolute discretion and such Outstanding Position of the Borrower(s) shall not at any time exceed the limit of the FEC Facility
when converted into the currency in which the FEC Facility is granted in; and (ii) marking to market the FEC from time to time
to monitor the potential losses/gains of the Borrower(s). If the potential marked to market foreign exchange losses in the aggregate
exceed 10% of the FEC Facility or such other percentage as the Lender may stipulated from time to time, ("the FX Risk"),
the Lender shall be entitled to require that the Borrower(s) provide cash or other acceptable collateral to cover the losses over
and above the FX Risk. Outstanding Position is defined as the aggregate liabilities of Borrower(s) under all outstanding FECs
with the Lender.

 

	12.		If any of the following events occur:-

 

	(a)		the Borrower(s) does/do not take up or honour any FEC or any part !hereof on the relevant
Maturity Date (unless the same has been extended by the Lender); or

 

	(b)		fail(s) to pay any of the FEC losses or fail to pay any monies (whether principal
or interest or other monies) due and owing to the Lender any other facilities with the Lender (whether or not a demand has been
made); or

 

	(c)		the Borrower(s)' Outstanding Position·exceeds the limit of the FEC Facility
or the potential foreign exchange losses of any FEC exceeds the FX Rick; or

 

    	49

    	 

    
 

	(d)		any Event of Default referred in any of the relevant Letters of Offer or this Agreement
shall occur,

 

then, the Lender shall be entitled to exercise any or all of its
remedies available to it under these Terms and Conditions and in law without further notice to the Borrower(s), including but not
limited to:-

 

	(i)		setting off any credit balances in any other accounts or combine, consolidate or merge
all of any of the accounts held by the Borrower(s) or any other security party with the Lender with any liabilities of the Borrower(s)
with the Lender (whether such liabilities are present future actual contingent primary collateral secured or unsecured, several
or joint) under any account, agreement, contract or otherwise with the Lender and set-off and transfer such sums standing to the
credit of any such accounts towards or in satisfaction of any of the liabilities or Indebtedness of the Borrower(s) to the Lender;
and/or

 

	(ii)		requiring any additional securities which are acceptable to the Lender upon such terms
and conditions as may be imposed by the Lender in its absolute discretion; and/or

 

	(iii)		earmarking the potential foreign exchange losses against any other banking or qedit
facilities of the Borrower(s) with the Lender; and/or

 

	(iv)		suspending or terminating any further dealings in FECs immediately and for such period
as the Lender may deem fit at its absolute discretion; and/or

 

	(v)		any other rights or remedies available to the Lender under any other agreement contract
or arrangement between the Lender and the Borrower(s).

 

	13.		The Borrower(s) shall indemnify and keep the Lender indemnified against any losses,
expenses, claims and damages (including but not limited to legal fees and expenses on a solicitor and own client basis) which
the Lender may sustain or incur:-

 

	(a)		from the fluctuation in the rates of exchange of the relevant currencies on the extension
or cancellations of any FECs;

 

	(b)		in relying and acting upon the instructions of or on behalf of the Borrower(s) for
FEC transactions;

 

	(c)		from the failure or omission of the Borrower(s) to take up any FECs or patt thereof
on the relevant Maturity Date;

 

	(d)		for breach or non-compliance or omission to comply with any of these Terms and Conditions
or any agreement, contract, arrangement or otherwise between the Lender and the Borrower(s) or of any of the Regulations.

 

	14.		If on any date amounts in the same currency are payable between the Lender and the
Borrower(s) then, on such date, each party's obligation to make payment of any such amount will be automatically satisfied and
discharged and, if the aggregate amount that would otherwise have been payable by one party exceeds the aggregate amount that
would otherwise have been payable by the other party, replaced by an obligation upon the party by whom the larger aggregate amount
would have been payable to pay to the other party, the excess of the larger aggregate amount over the smaller aggregate amount.

 

	15.		The Borrower(s) acknowledge(s) and agree(s) to the use of voice recording devices
by the Lender of all telephone conversations between the Lender and the Borrower(s) without any automatic tone warning device
in order to permit the Lender to verify orders and data concerning any matters relating to the FEC transactions.

 

    	50

    	 

    
 

Bankers
Acceptance Facility ("BA Facility'')

 

	1.		The Borrower(s) may subject to the provisions of this Agreement and the relevant Letters
of Offer, utilize the BA Facility in such manner and subject to such conditions as the Lender may from time to time prescribe.

 

	2.		The Lender may at its absolute discretion accept or reject any application by the
Borrower(s) for the Lender's acceptance and/or discounting of Bankers Acceptance ("BA''). The Borrower(s) shall comply with
the following conditions and any other conditions that may be imposed by the Lender from time to time:-

 

	(a)		the Borrower(s) has not and will not obtain another source of financing for the trade
transaction concerned and the BA is for financing its trade transaction namely imports to and exports from Malaysia and domestic
trade;

 

	(b)		delivery to the Lender of such satisfactory documentary evidence of the trade transaction
as may be required by the Lender. In the case of financing of exports from Malaysia and/or sales within Malaysia, the original
export bills or inland bills shall be delivered to the Lender for collection through the Lender and the proceeds of the said export
bills and/or inland bills shall be subject to the Lender's control until the Borrower(s)' obligation is fully discharged on maturity
of the BA and the Lender has been paid in full. The Lender may use the said proceeds towards settlement of all amounts owing by
the Borrower(s) and remaining unpaid in respect of the BA or any of the Borrower(s)' indebtedness to the Lender under any of the
other facilities made available to the Borrower(s); and

 

	(c)		the drawing and acceptance and/or discount of the BA shall be subject to all other
requirements and conditions which may be prescribed by Bank Negara Malaysia from time to time.

 

	3.		Without prejudice and in addition to any other rights or remedies which the Lender
may be entitled to on maturity of the BA, the Lender may, at its sole and absolute discretion and without any obligation whether
at law or in equity so to do, debit the Borrower(s)' current account or overdraft account with the Lender (if the Borrower(s)
maintain(s) a current or overdraft account with the Lender) with the face value of the BA at maturity and with any unpaid commission,
interest or bank charges and the Borrower(s) hereby irrevocably and unconditionally consent(s) to the Lender so doing. Interest
will be charged at the applicable Default Rate on the amount outstanding under the BA, if the BA is not discharged on the maturity
date or if the monies received by the Lender are not sufficient to discharge the BA on maturity, for the period commencing from
the maturity date until the date the Lender receives full payment.

 

	4.		The Lender may re-discount any BA drawn by the Borrower(s) and discounted by the Lender
and any monies received by the Lender as a result of the re-discounting shall not be regarded as payment towards the Borrower(s)'
liability to the Lender.

 

	5.		No BA shall be issued by the Lender if, following such issue, the aggregate of all
the sums outstanding in respect of the BA Facility or the trade facilities of which the BA Facility forms a part thereof would
exceed the aggregate limit prescribed by the Lender or any sub-limits specifically imposed by the Lender for the BA Facility or
the trade facilities unless the Lender shall agree otherwise.

 

	6.		The rate of acceptance commission and discount charges shall be determined by the
Lender from time to time at its absolute discretion.

 

	7.		The Borrower(s) shall indemnify and keep the Lender indemnified against any losses,
costs and/or expenses which the Lender to incur as a result of its accepting and/or discounting the BA drawn by the Borrower(s).

 

 

    	51

    	 

    
 

Foreign/Domestic Bills of Exchange Purchased (Authority to
Purchase) Facilities ("BEP Facility")

 

	1.		Subject to the terms of this Agreement and the relevant Letters of Offer, the Borrower(s)
may present foreign/domestic bills to the Lender for purchase or in the case of BEP (Authority to Purchase) Facilities, the Borrower(s)
may present bills drawn under an inward letter of credit to the Lender for purchase and the Lender may at its sole and absolute
discretion purchase such bills offered by the Borrower(s) under the BEP Facility.

 

	2.		Upon the Lender purchasing any bills presented by the Borrower(s) to the Lender, the
Lender shall credit the Borrower(s)' overdraft or current account maintained with the Lender with the face value of the bill purchased
by the Lender less the commission charged by the Lender for purchasing such bill and all other bank charges and costs payable
by the Borrower(s).

 

	3.		Without prejudice and in addition to any rights or remedies which the Lender may be
entitled under this Agreement, the Lender may, at its sole and absolute discretion debit the Borrower(s)' overdraft or current
account maintained with the Lender with the face value of the purchased by the Lender under the BEP Facility which has been returned
to the Lender unpaid and the Borrower(s) hereby irrevocably and unconditionally consent(s) to the Lender so doing and such amounts
debited shall become immediately due and payable and failing payment, interest at the applicable Default· Rate shall be
charged from the due date until the date the Lender receives full payment.

 

	4.		The Lender may not honour any bill drawn or issued by the Borrower(s) on the Lender
for payment under the BEP Facility if the Lender is of the opinion (which opinion shall be final and binding upon the Borrower(s))
that the bill presented to the Lender for collection was issued or drawn by a party related to the Borrower(s), or if following
such purchase the aggregate of all the sums outstanding in respect of the BEP Facility or the trade facilities of which the BEP
Facility forms part thereof, as the case may be, would exceed the aggregate limit imposed by the Lender or any sub-limits specifically
imposed by the Lender for the BEP Facility or the trade facilities, unless the Lender shall agree otherwise.

 

	5.		The Borrower(s) shall pay to the Lender a commission on each bill purchased by the
Lender under the BEP Facility at the time such bill is purchased.

 

	6.		Subject to the Lender's right of variation, the rate of commission charged by the
Lender on each bill purchased by the Lender under the BEP Facility shall be at such rate as may be determined by the Lender from
time to time at its sole and absolute discretion.

 

	7.		Bills returned unpaid and bills drawn by the Borrower(s) or any related party will
not be purchased and may only be accepted for collection purposes.

 

	8.		The Borrower(s) acknowledge(s) and accept(s) that notwithstanding any other provision
to the contrary, the Lender reserves the right not to accept any bill drawn or issued by the Borrower(s) for payment under the
BEP Facility at the Lender's sole and absolute discretion.

 

	9.		The Borrower(s) shall indemnify and keep the Lender indemnified against any damages,
losses, costs and expenses which the Lender may suffer or incur as a result of granting the BEP Facility to the Borrower(s).

 

	10.		The Borrower(s) shall not utilise the BEP Facility if upon such utilisation, the
aggregate of all the sums out standing in respect of the BEP Facility or the trade facilities of which the BEP Facility forms
a part thereof would exceed the aggregate limit prescribed by the Lender or any sub-limits specifically imposed by the Lender
for the BEP Facility or the trade facilities unless the Lender shall agree otherwise.

 

	11.		The BEP Facility shall be subject to such other terms and regulations as may be prescribed
from time to time by the Lender at its sole and absolute discretion and the Borrower(s) hereby irrevocably and unconditionally
agree(s) to accept, abide and be bound by such terms and regulations.

 

 

    	52

    	 

    
 

Overdraft Facility

 

	1.		Subject to the terms of this Agreement and the relevant Letters of Offer, the Borrower(s)
may overdraw its current account maintained with the Lender under the Overdraft facility (hereinafter called the "OD Facility").

 

	2.		The Borrower(s) shall not utilise the OD Facility and the Lender may refuse to honour
and pay on any cheque drawn by the Borrower(s) if upon such utilisation, the aggregate of all the sums outstanding in respect
of the OD Facility or the trade facilities of which the OD Facility forms a part thereof would exceed the aggregate limit prescribed
by the Lender or any sub-limits specifically imposed by the Lender for the OD Facility or the trade facilities unless the Lender
shall agree otherwise.

 

	3.		In addition to and not ·in derogation of any other rights of the Lender, the
Lender hereby reserves the right to designate the Borrower(s)' current account as a "Special Account" in accordance
with the Guidelines of the Biro Maklumat Cek of Bank Negara Malaysia, whereupon the Borrower(s) shall immediately upon the Lender's
request, return to the Lender all unused cheques and so long as such current account remain designated as a "Special Account",
no cheque book will be issued and all withdrawals from such account by the Borrower(s) can only be made by way of cash withdrawals,
cashier's order, bank draft or transfer. The Lender further reserves the right at its sole and absolute discretion to terminate
the OD Facility and to close the Borrower(s)' account with the Lender, irrespective of whether the Borrower(s)' account has been
satisfactorily conducted, upon the Lender's receipt of notification from the Biro Maklumat Cek of Bank Negara Malaysia that the
Borrower(s) has been blacklisted.

 

	4.		Interest on the OD Facility shall be due and payable immediately upon the demand by
the Lender and until demanded as aforesaid, shall be paid monthly by the Borrower(s).

 

	5.		Without prejudice and in addition to any other rights or remedies which the Lender
may be entitled to, the Lender may, at its sole and absolute discretion and without any obligation whether at law or in equity
so to do, debit the Borrower(s)' current account with the Lender with any interest and any other charges or costs payable or agreed
to be payable by the Borrower(s) in connection with or arising from the OD Facility and the Borrower(s) hereby irrevocably and
unconditionally

consent(s) to the ender so doing.

 

	6.		The Borrower(s) shall indemnify and keep the Lender indemnified against any damages,
losses, costs and expenses which the Lender may suffer or incur as a result of its grant of the OD Facility to the Borrower(s).

 

	7.		The OD Facility shall be subject to such other terms and conditions set out in this
Agreement and the relevant Letters of Offer including any other terms and regulations as may be prescribed from time to time by
the Lender at its sole and absolute discretion and the Borrower(s) hereby irrevocably and unconditionally agree(s) to accept,
abide and be bound by such terms and regulations.

 

	8.		Where the OD Facility is for a specific purpose or specific period, the Borrower(s)
hereby acknowledge(s) and confirm(s) that the Borrower(s) is/are fully aware that the OD Facility may be recalled at any time
and that the Borrower(s) should at all material times take prudent measures to assess the impact of such recall on the Borrower(s)'
business and/or specific purpose, and will take all necessary precautions to safeguard the Borrower(s)' own liquidity requirements
and ability to proceed with its business and specific purpose as well as obligations under the OD Facility.

 

 

    	53

    	 

    
 

Export Credit Refinancing Facility (Pre-Shipment
I Post Shipment)

 

	1.		The Borrower(s) may subject to the provisions of this Agreement and the relevant Letters
of Offer, utilise the ECR Facility (Pre-Shipment/Post Shipment in such manner and upon such conditions as the Lender may from
time to time prescribe.

 

	2.		The pre/post shipment ECR funding rate shall be at the rate determined by Bank Negara
Malaysia from time to time and the Lender shall add on a margin at such rate as may be determined by the Lender.

 

	3		(a)Pre-Shipment ECR Facility

 

The period of financing shall commence from the date
of drawdown of the ECR Facility (Pre-Shipment) (subject to the lodgement of a pre-shipment bill with the Lender) up to the maturity
date of the pre-shipment bill. In the event on the maturity date, payments are not made towards settlement of the pre-shipment
bill the Borrower(s) shall pay interest thereon at the applicable Default Rate for the period commencing from the maturity date
until the Lender receives full payment (both before as well as after judgement or order).

 

	(b)		Post Shipment ECR Facility The period of financing shall commence from the time the
Borrower(s) presents to the Lender the export documents for financing up to the maturity date of the post shipment bill or upon
receipt of the export proceeds, whichever is earlier. In the event on the maturity date, the Lender does not receive the export
proceeds for whatever reasons, the Borrower(s) shall pay interest thereon at the applicable Default Rate for the period commencing
from the maturity date until the Lender receives full payment (both before as well as after judgement or order).

 

	4.		The Borrower(s) warrant(s) that:-

 

	(i)		the goods related to the underlying transaction are genuine exports;

 

	(ii)		no other means of financing has been or will be obtained for the underlying exports.

 

	5.		The Borrower(s) shall:-

 

	(a)		ensure that the export proceeds will be specifically channeled to the Lender for liquidation
of outstanding ECR loans;

 

	(b)		comply with all requirements and terms and conditions as specified in the "Guidelines
on ECR facilities"; and

 

	(c)		forward to the Lender the following documents and such other documents as may be requested
by the Lender after each export:-

 

	(i)		copy of invoice and transport document;

 

	(ii)		copy of remittance schedule which show that payments will be channeled to the Lender;
and

 

	(iii)		original customs declaration form.

 

	6.		The Borrower(s) shall not utilise the ECR Facility (Pre-Shipment/Post Shipment) if
upon such utilisation, the aggregate of all the sums outstanding in respect of the ECR Facility (Pre Shipment/Post shipment) or
the trade facilities of which the ECR Facility (Pre-Shipment/Post Shipment) forms a part thereof would exceed the aggregate limit
prescribed by the Lender or any sub-limits specifically imposed by the Lender for the ECR Facility (Pre-Shipment/Post Shipment)
or the trade facilities unless the Lender shall agree otherwise.

 

	7.		The Borrower(s) shall indemnify and keep the Lender indemnified against any damages,
losses, costs and expenses which the Lender may suffer or incur as a result of granting the ECR Facility (Pre-Shipment/Post Shipment)
to the Borrower(s). ·

 

	8.		The ECR Facility (Pre-Shipment/Post Shipment) shall be subject to such other terms
and regulations as may be prescribed from time to time by the Lender at its sole and absolute discretion and the Borrower(s) hereby
irrevocably and unconditionally agrees to accept, abide and be bound by such terms and regulations.

 

    	54

    	 

    
 

Onshore Foreign Currency Loan ("OFCL")
Facility

 

 

	1.		The Borrower(s) may subject to the provisions hereunder and the relevant Letter(s)
of Offer, utilise the OFCL Facility in such manner and subject to such conditions as the Lender may from time to time prescribe.

 

	2.		The Lender may at its absolute discretion accept or reject any application by the
Borrower(s) for an onshore foreign currency loan ("OFCL"). The Borrower(s) shall comply with the following conditions
and any other conditions that may be imposed by the Lender from time to time:-

 

	(a)		the Borrower(s) has not and will not obtain another source of financing for the trade
transaction concerned and the OFCL is for financing its trade transactions namely imports to Malaysia;

 

	(b)		delivery to the Lender of such satisfactory doci1mentary evidence of the trade transaction,
such as the original invoice, transport-documents as may be required by the Lender; and

 

	(c)		the drawing of the OFCL shall be subject to all other requirements and conditions
which may be prescribed by Bank Negara Malaysia from time to time.

 

	3.		The minimum amount that may be drawndown is USD50,000-00 (or its equivalent in other
currencies if permitted by the Lender) or such other amount as may be determined by the Lender at its absolute discretion from
time to time for such tenure as may be specified by the Lender not exceeding 180 days. Payment will be made directly to the foreign
supplier or to the foreign supplier's Lender, unless the Lender agrees otherwise subject to such conditions as it may at its discretion
impose.

 

	4.		No drawings under the OFCL Facility shall be permitted if, following such drawing,
the aggregate of all sums outstanding in respect of the OFCL Facility, the Bankers Acceptance Facility ("BA Facility")
or the trade facilities of which the OFCL Facility and the BA Facility (if any) forms a part thereof, would exceed the limit prescribed
by the Lender or any sub-limits specifically imposed by the Lender for the OFCL Facility, the BA Facility or the trade facilities,
unless the Lender shall agree otherwise.

 

	5.		If the Borrower has a foreign currency account with the Lender, the Borrower must
use the foreign currency in the foreign currency account to settle the OFCLs on the last day of their respective financing period
("Maturity Date") and the foreign currency (if not in USD) will be converted into USD at the Lender's prevailing rate
of exchange. If the Borrower does not have a foreign currency account with the Lender or there are insufficient funds in the foreign
currency account, the Borrower shall repay the OFCL by buying the requisite amount of USD from the Lender at the Lender's prevailing
rate of exchange. If the Borrower defaults in making payment of any OFCL or interest thereon or in the event of demand or recall
of the OFCL Facility, the Borrower shall pay interest at the rate of 3.5% per annum or such other rate as may be stipulated by
the Lender above its Base Lending Rate at its absolute discretion ("Default Rate"), on all overdue amounts and any other
sums due and payable to the Lender as agreed liquidated damages, calculated from the date of such default up to the date the Lender
receives full payment (both before as well as after demand judgment or order).

 

	6.		Without prejudice to and in addition to any other rights or remedies which the Lender
may be entitled to, if the Borrower(s) fails to pay the Lender any OFCL on the relevant Maturity Date or if the monies received
by the Lender are not sufficient to fully settle the OFCL, the Lender may at its sole and absolute discretion and without any
obligation whether at law or in equity to do so convert the overdue amount or any part thereof into Ringgit Malaysia at the Lender's
prevailing rate of exchange on the date of conversion (the Lender having the absolute discretion to determine the date of conversion)
and debit the Borrower(s)' current or overdraft account for the same and any other sums together with interest thereon at the
Default Rate which is due and payable by the Borrower and the Borrower hereby irrevocably and unconditionally consents to the
Lender so doing.

  

	7.		The Borrower(s) shall indemnify and keep the Lender indemnified against any losses,
expenses, claims and damages (including but not limited to legal fees and expenses on a solicitor and own client basis) which
the Lender may sustain or incur as a result of granting the OFCL Facility to the Borrower(s), including without limitation from
fluctuations in the rates of exchange of the relevant currencies for the OFCL.

 

    	55

    	 

    
 

Foreign Trade Loan ("FTL") Facility

 

 

	1.		The Borrower(s) may subject to the provisions hereunder and the relevant Letter(s)
of Offer, utilise the FTL facility in such manner and subject to such conditions as the Lender may from time to time prescribe.

 

	2.		The Lender may at its absolute discretion accept or reject any application by the
Borrower(s) for a Foreign Trade Loan ("FTL"). The Borrower(s) shall comply with the following conditions and any other
conditions that may be imposed by the Lender from time to time:-

 

	(a)		the Borrower(s) has/have not and will not obtain another source of financing for the
trade transaction concerned and the FTL is for financing its trade transactions namely exports from Malaysia;

 

	(b)		delivery to the Lender of such satisfactory documentary evidence of the trade transaction,
such as the original invoice, transport documents as may be required by the Lender; and

 

	(c)		the drawing of the FTL shall be subject to all other requirements and conditions which
may be prescribed by Bank Negara Malaysia from time to time.

 

	3.		The minimum amount that may be drawn down is USDS0,000-00 (or its equivalent in other
currencies if permitted by the Lender) or such other amount as may be determined by the Lender at its absolute discretion from
time to time for such tenure as may be specified by the Lender not exceeding 180 days.

 

	4.		No drawings under the FTL facility shall be permitted if, following such drawing,
the aggregate of all sums outstanding in respect of the FTL facility or trade facilities of which the FTL facility forms a part
thereof, would exceed the limit prescribed by the Lender or any sub-limits specifically imposed by the Lender for the FTL facility
or trade facilities, unless the Lender shall agree otherwise.

 

	5.		If the Borrower(s) has a Foreign Currency Account with the Lender, the Borrower(s)
must use the foreign currency in the Foreign Currency Account to settle the FTLs on the last day of their respective financing
period ("Maturity Date") and the foreign currency (if not in USD) will be converted to USD at the Lender's prevailing
rate of exchange. If the Borrower(s) does not have a Foreign Currency Account with the Lender or there are insufficient funds
in the Foreign Currency Account, the Borrower(s) shall repay the FTL by buying the requisite amount of USD from the Lender at
the Lender's prevailing rate of exchange. If the Borrower(s) defaults in making payment of any FTL or interest thereon or in the
event of demand or recall of the FTL facility, the Borrower(s) shall pay interest at the rate of3.5% per annum or such other rate
as may be stipulated by the Lender above its Base Lending Rate at its absolute discretion ("Default Rate"), on all overdue
amounts and any other sums due and payable to the Lender as agreed liquidated damages, calculated from the date of such default
up to the date the Lender receives full payment (both before as well as after demand judgment or order).

 

	6.		Without prejudice to and in addition to any other rights or remedies which the Lender
may be entitled to, if the Borrower(s) fail(s) to pay the Lender any FTL on the relevant Maturity Date or if the monies received
by the Lender are not sufficient to fully settle the FTL, the Lender may at its sole and absolute discretion and without obligation
whether at law or in equity to do so convert the overdue amount or any part thereof into Ringgit Malaysia at the Lender's prevailing
rate of exchange on the date of conversion (the Lender having the absolute discretion to determine the date of conversion) and
debit the Borrower(s)' current or overdraft account for the same and any other sums together with interest thereon at the Default
Rate which is due; and payable by the Borrower(s) and the Borrower(s) hereby irrevocably and unconditionally consents to the Lender
so doing.

 

	7.		The Borrower(s) shall indemnify and keep the Lender indemnified against any losses,
expenses, claims and damages (including but not limited to legal fees and expenses on a solicitor and own client basis) which
the Lender may sustain or incur· as a result of granting the FTL facility to the Borrower(s), including without limitation
from fluctuations in the rates of exchange of the relevant currencies for the FTL.

 

 

    	56

    	 

    
 

Invoice Financing Facility ("IVF
Facility")

 

	1.		The Borrower(s) may, subject to the provisions of this Agreement and the relevant
Letter(s) of Offer, utilise the IVF Facility in such manner and subject to such conditions as the Lender may from time to time
prescribe.

 

	2.		The Lender may at its absolute discretion accept or reject any application by the
Borrower(s) for the Lender's acceptance and/or discounting of Invoice Financing ("IVF"). The Borrower(s) shall comply
with the following conditions and any other conditions that may be imposed by the Lender from time to time:-

 

	(a)		the Borrower(s) has/have not and will not obtain another source of financing for the
trade transaction concerned and the IVF is for financing its trade transaction namely imports to and exports from Malaysia and
domestic trade;

 

	(b)		delivery to the Lender of such satisfactory documentary evidence of the trade transaction
as may be required by the Lender. In the case of financing of exports from Malaysia and/or sales within Malaysia, the original
export bills or inland bills shall be delivered to the Lender for collection through the Lender and the proceeds of the said export
bills and/or inland bills shall be subject to the Lender's control until the Borrower(s)' obligation is fully discharged on maturity
of the IVF and the Lender has been paid in full. The Lender may use the said proceeds towards settlement of all amounts owing
by the Borrower(s) and remaining unpaid in respect of the IVF or any of the Borrower(s)' indebtedness to the Lender under any
of the other facilities made available to the Borrower(s); and

 

	(c)		the drawing and acceptance and/or discount of the IVF shall be subject to all other
requirements and conditions which may be prescribed by the Lender from time to time.

 

	3.		Without prejudice and in addition to any other rights or remedies which the Lender
may be entitled to on maturity of the IVF, the Lender may, at its sole and ·absolute discretion and without any obligation
whether at law or in equity so to do, debit the Borrower(s)' current account or overdraft account with the Lender (if the Borrower(s)
maintain(s) a current or overdraft account with the Lender) with the value of the IVF at maturity and with any unpaid commission,
interest or lender charges and the Borrower(s) hereby irrevocably and unconditionally consent(s) to the Lender so doing. Interest
will be charged at the applicable Default Rate on the amount outstanding under the IVF, if the IVF is not discharged on the maturity
date or if the monies received by the Lender are not sufficient to discharge the IVF on maturity, for the period commencing from
the maturity date until the date the Lender receives full payment.

 

	4.		No IVF shall be issued by the Lender if, following such issue, the aggregate of all
the sums outstanding in respect of the IVF Facility or the trade facilities of which the IVF Facility forms a part would exceed
the aggregate limit prescribed by the Lender or any sub-limits specifically imposed by the Lender for the IVF Facility or the
trade facilities unless the Lender shall agree otherwise.

 

	5.		The rate of acceptance commission and discount charges shall be determined by the
Lender from time to time at its absolute discretion.

 

	6.		The Borrower(s) shall indemnify and keep the Lender indemnified against any losses,
costs and/or expenses which the Lender may incur as a result of its accepting and/or discounting the IVF drawn by the Borrower(s).

 

 

 

    	57Exhibit 10.1

 

 

STOCK PURCHASE AGREEMENT

 

This Stock Purchase
Agreement (“Agreement”) is made and entered into as of December 14, 2012 (“Effective Date”),
by and between VelaTel Global Communications, Inc., a Nevada
corporation (“Company”), and Ironridge Technology Co., a division of Ironridge Global IV, Ltd., a British Virgin
Islands business company (“Purchaser”).

Recitals

 

A.              
The parties desire that, upon the terms and subject to the conditions herein, Purchaser will purchase $12,000,000.00 in shares
of convertible, redeemable Series B Preferred Stock, convertible into shares of Common Stock at $0.20 per share; and

 

B.              
The offer and sale of the Shares provided for herein are being made pursuant to exemption from registration under Section 4(2)
of the Act as a transaction by an issuer not involving any public offering, and as a private placement of restricted securities
pursuant to Rule 506 of Regulation D promulgated under the Act.

 

Agreement

 

In consideration of
the foregoing, the receipt and adequacy of which are hereby acknowledged, Company and Purchaser agree as follows:

 

I.                
Definitions. In addition to the terms defined elsewhere
in this Agreement and the Transaction Documents, capitalized terms that are not otherwise defined herein have the meanings set
forth in the Glossary of Defined Terms attached hereto as Exhibit 1.

 

II.              
Purchase and Sale.

 

A.              
Purchase Amount. Subject to the terms and conditions
herein and the satisfaction of the conditions to Closing set forth below, Company hereby sells to Purchaser for the aggregate sum
of $12,000,000.00 (“Purchase Amount”), and Purchaser hereby purchases from
Company, 1,200 shares of Series B Preferred Stock (“Preferred Shares”) of
Company, in tranches of 60 Preferred Shares ($600,000.00) each, at a price of $10,000.00 per Preferred Share.

 

B.              
Deliveries. The following documents will be fully executed
and delivered on the Effective Date:

 

1.              
This Agreement;

 

2.              
Certificate of Designations, in the form attached hereto as Exhibit 2, as filed with and accepted by the Secretary of
State of the State of Nevada;

 

3.              
Transfer Agent Instructions, in the form attached hereto as Exhibit 3.

 

4.              
Opinion, in the form attached hereto as Exhibit 4;

 

5.              
Officer’s Certificate, in the form attached hereto as Exhibit 5;

 

6.              
Secretary’s Certificate, in the form attached hereto as Exhibit 6; and

 

7.              
A certificate representing 60 Preferred Shares to Purchaser as a non-refundable commitment fee for entering into this Agreement.

 

    	1

    	 	

    
 

 

C.               
Conditions. Notwithstanding any other provision, as
a condition precedent to each Closing (defined below), all of the following conditions must be satisfied:

 

1.              
All documents, instruments and other writings required to be delivered by Company to Purchaser pursuant to any provision of
this Agreement or in order to implement and effect the transactions contemplated herein have been fully executed and delivered,
including without limitation those enumerated in Section II.B above;

 

2.              
The Common Stock is listed for and currently trading on the same Trading Market, Company is in compliance with all requirements
to maintain listing on the Trading Market, and there is no notice of
any suspension or delisting with respect to the trading of the shares of Common Stock on such
Trading Market;

 

3.              
The representations and warranties of Company set forth in this Agreement are true and correct in all material respects as
if made on such date;

 

4.              
No material breach or default has occurred under any Transaction Document or any other agreement with Purchaser, and
all shares of Common Stock issuable to Purchaser have been timely delivered, and shares issued over two weeks have been received
into Purchaser’s account in electronic form and fully cleared for trading;

 

5.              
Company has the number of duly authorized shares of Common
Stock reserved for issuance as required pursuant to the terms of this Agreement;

 

6.              
There is not then in effect any law, rule or regulation prohibiting or restricting the transactions contemplated in any Transaction
Document, or requiring any consent or approval which will not have been obtained, nor is there any pending or threatened proceeding
or investigation which may have the effect of prohibiting or adversely affecting any of the transactions contemplated by this Agreement;
no statute, rule, regulation, executive order, decree, ruling or injunction will have been enacted, entered, promulgated or adopted
by any court or governmental authority of competent jurisdiction that prohibits the transactions contemplated by this Agreement,
and no actions, suits or proceedings will be in progress, pending or, to Company’s knowledge threatened, by any person other
than Purchaser or any Affiliate of Purchaser, that seek to enjoin or prohibit the transactions contemplated by this Agreement.

 

D.              
Additional Conditions. Notwithstanding any other provision,
as a condition precedent to each Closing after the first Closing, all of the following conditions must also be satisfied:

 

1.              
Delivery of a legal opinion with negative assurance from outside legal counsel in agreed form at the second Closing;

 

2.              
Delivery of an auditor cold comfort letter in agreed form at the second Closing;

 

3.              
Prior to the third Closing, a Registration Statement covering the number of shares reasonably necessary for conversion of all
Preferred Shares then outstanding and to be issued in the Closing, is current and effective; and

 

4.              
All of the Equity Conditions have been met with respect to the Closing.

 

    	2

    	 	

    
 

E.               
Closings. Subject to the conditions and limitations
set forth in this Agreement, (1) at each closing of a purchase and sale of Preferred Shares (each, a “Closing”),
Purchaser will purchase and make payment for the Preferred Shares by payment to Company in
cash by wire transfer of immediately available funds to an account designated by Company; (2) Purchaser will purchase 60 Preferred
Shares at each Closing, the first Closing will take place immediately when all conditions set forth in Section II.C
above have been fully satisfied, and each subsequent Closing which will take place on the first day each calendar month thereafter
(or sooner, at Company’s sole option), if all conditions in Section II.D above have
been fully satisfied, until the full Purchase Amount has been purchased; and (3) Company will deliver to Purchaser by reputable
overnight courier, immediately upon receipt of the funds, stock certificates representing the Preferred Shares. 

 

III.            
Representations and Warranties.

 

A.              
Representations Regarding Transaction.
Except as set forth under the corresponding section of the Disclosure Schedules, if any, Company hereby represents and warrants
to, and as applicable covenants with, Purchaser as of the Closing:

 

1.              
Organization and Qualification. Company and each Subsidiary is an entity duly incorporated or otherwise organized, validly
existing and in good standing under the laws of the jurisdiction of its incorporation or organization, as applicable, with the
requisite power and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither
Company nor any Subsidiary is in violation or default of any of the provisions of its respective certificate or articles of incorporation,
bylaws or other organizational or charter documents. Each of Company and each Subsidiary is duly qualified to conduct business
and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted
or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as
the case may be, could not have or reasonably be expected to result in a Material Adverse Effect and no proceeding has been instituted
in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification.

 

2.              
Authorization; Enforcement. Company has the requisite corporate power and authority to enter into and
to consummate the transactions contemplated by each of the Transaction Documents and otherwise to carry out its obligations hereunder
or thereunder. The execution and delivery of each of the Transaction Documents by Company and the consummation by it of the transactions
contemplated hereby or thereby have been duly authorized by all necessary action on the part of Company and no further consent
or action is required by Company other than the filing of the Certificate of Designations. Each of the Transaction Documents has
been, or upon delivery will be, duly executed by Company and, when delivered in accordance with the terms hereof, will constitute
the valid and binding obligation of Company, enforceable against Company in accordance with its terms, except (a) as limited by
general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application
affecting enforcement of creditors’ rights generally, (b) as limited by laws relating to the availability of specific performance,
injunctive relief or other equitable remedies and (c) insofar as indemnification and contribution provisions may be limited by
applicable law. Neither Company nor any Subsidiary is in violation
of any of the provisions of its respective certificate or articles of incorporation, by-laws or other organizational or charter
documents.

 

    	3

    	 	

    
 

 

3.              
No Conflicts. The execution, delivery and performance of the Transaction Documents by Company, the issuance and sale
of the Shares and the consummation by Company of the other transactions contemplated thereby do not and will not (a) conflict with
or violate any provision of Company’s or any Subsidiary’s certificate or articles of incorporation, bylaws or other
organizational or charter documents, (b) conflict with, or constitute a default (or an event that with notice or lapse of time
or both would become a default) under, result in the creation of any Lien upon any of the properties or assets of Company or any
Subsidiary, or give to others any rights of termination, amendment, acceleration or cancellation (with or without notice, lapse
of time or both) of, any agreement, credit facility, debt or other instrument (evidencing a Company or Subsidiary debt or otherwise)
or other understanding to which Company or any Subsidiary is a party or by which any property or asset of Company or any Subsidiary
is bound or affected, (c) conflict with or result in a violation of any material law, rule, regulation, order, judgment, injunction,
decree or other restriction of any court or governmental authority to which Company or a Subsidiary is subject (including federal
and state securities laws and regulations), or by which any property or asset of Company or a Subsidiary is bound or affected,
or (d) conflict with or violate the terms of any material agreement by which Company or any Subsidiary is bound or to which any
property or asset of Company or any Subsidiary is bound or affected; except in the case of each of clauses (b), (c) and (d), such
as could not have or reasonably be expected to result in a Material Adverse Effect.

 

4.              
Litigation.  There is no action, suit, inquiry, notice
of violation, proceeding or investigation pending or, to the knowledge of Company, threatened against or affecting Company, any
Subsidiary or any of their respective properties before or by any court, arbitrator, governmental or administrative agency or regulatory
authority (federal, state, county, local or foreign) (collectively, an “Action”), which could adversely affect
or challenges the legality, validity or enforceability of any of the Transaction Documents or the Shares. The Commission has not
issued any stop order or other order suspending the effectiveness of any registration statement filed by Company or any Subsidiary
under the Exchange Act or the Act.

 

5.              
Filings, Consents and Approvals. Neither Company nor any Subsidiary is required to obtain any consent,
waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state,
local or other governmental authority or other Person in connection with the execution, delivery and performance by Company of
the Transaction Documents, other than the filing of the Certificate of Designations and required federal and state securities filings
and such filings and approvals as are required to be made or obtained under the applicable Trading Market rules in connection with
the transactions contemplated hereby, each of which has been, or if not yet required to be filed will be, timely filed.

 

6.              
Issuance of Shares. The Shares are duly authorized and, when issued and paid for in accordance with the applicable Transaction
Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens. Company has reserved and
will continue to reserve from its duly authorized capital stock sufficient shares of its Common Stock for issuance pursuant to
the Transaction Documents.

 

    	4

    	 	

    
 

7.              
Disclosure; Non-Public Information. Company will widely publicly disclose all material terms of this Agreement
and the transactions contemplated hereby in accordance with Regulation FD no later than 8:30 am on the Trading Day following the
Effective Date. Notwithstanding any other provision, except with respect to information that must be, and only to the extent that
it actually is, timely publicly disclosed by Company pursuant to the foregoing sentence, neither Company nor any other Person acting
on its behalf has provided Purchaser or its representatives, agents or attorneys with any information that constitutes or might
constitute material, non-public information, including without limitation this Agreement and the Exhibits and Disclosure Schedules
hereto. No information contained in the Disclosure Schedules constitutes material non-public information. There is no adverse material
information regarding Company that has not been publicly disclosed prior to the Effective Date. Company understands and confirms
that Purchaser will rely on the foregoing representations and covenants in effecting transactions in securities of Company. All
disclosure provided to Purchaser regarding Company, its business and the transactions contemplated hereby, including without limitation
the Disclosure Schedules, furnished by or on behalf of Company with respect to the representations and warranties made herein are
true and correct in all material respects and do not contain any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading.

 

8.              
No Integrated Offering, Neither Company, nor any of its Affiliates, nor any Person acting on its or their behalf has,
directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances
that would cause this offering of the Shares to be integrated with prior offerings by Company that cause a violation of the Act
or any applicable stockholder approval provisions, including, without limitation, under the rules and regulations of the Trading
Market.

 

9.              
Financial Condition. Based on the financial condition
of Company and its projected capital requirements, effective as of the Commitment Closing, the Company will require additional
capital to carry on its business for the current fiscal year as now conducted and as proposed to be conducted. Company does not
intend to incur debts beyond its ability to pay such debts as they mature, taking into account the timing and amounts of cash to
be payable on or in respect of its debt. The Public Reports set forth as of the dates thereof all outstanding secured and unsecured
Indebtedness of Company or any Subsidiary, or for which Company or any Subsidiary has commitments, and any default with respect
to any Indebtedness.

 

10.           
Section 5 Compliance. No representation or warranty or other statement made by Company
in the Transaction Documents contains any untrue statement or omits to state a material fact necessary to make any of them, in
light of the circumstances in which it was made, not misleading. Company is not aware of any facts or circumstances that would
cause the transactions contemplated by the Transaction Documents, when consummated, to violate Section 5 of the Act or other federal
or state securities laws or regulations.

 

11.           
Investment Company. Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Shares,
will not be or be an Affiliate of, an “investment company” within the meaning of the Investment Company Act of 1940,
as amended. Company will conduct its business in a manner so that it will not become subject to the Investment Company Act.

 

    	5

    	 	

    
 

 

B.              
Representations Regarding Company. Except
as set forth in any current or future Public Reports or under the corresponding section of the Disclosure Schedules, if any, Company
hereby represents and warrants to, and as applicable covenants with, Purchaser as of the Closing:

 

1.              
Capitalization. The capitalization of Company is as described in Company’s most recently filed Public Report and
Company has not issued any capital stock since such filing. No Person has any right of first refusal, preemptive right, right of
participation, or any similar right to participate in the transactions contemplated by the Transaction Documents which has not
been waived or satisfied. Except as a result of the purchase and sale of the Shares, there are no outstanding options, warrants,
script rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights or obligations
convertible into or exchangeable for, or giving any Person any right to subscribe for or acquire, any shares of Common Stock, or
contracts, commitments, understandings or arrangements by which Company or any Subsidiary is or may become bound to issue additional
shares of Common Stock or securities convertible into or exercisable for shares of Common Stock. The issuance and sale of the Shares
will not obligate Company to issue shares of Common Stock or other securities to any Person, other than Purchaser, and will not
result in a right of any holder of Company securities to adjust the exercise, conversion, exchange, or reset price under such securities.
All of the outstanding shares of capital stock of Company are validly issued, fully paid and nonassessable, have been issued in
material compliance with all federal and state securities laws, and none of such outstanding shares was issued in violation of
any preemptive rights or similar rights to subscribe for or purchase securities. No
further approval or authorization of any stockholder, the Board of Directors of Company or others is required for the issuance
and sale of the Shares. There are no stockholders agreements, voting agreements or other similar agreements with respect to Company’s
capital stock to which Company is a party or, to the knowledge of Company, between or among any of Company’s stockholders.

 

2.              
Subsidiaries. All of the direct and indirect subsidiaries of Company are set forth in the Public Reports or the corresponding
section of the Disclosure Schedules. Company owns,
directly or indirectly, all of the capital stock or other equity interests of each Subsidiary, and all of such directly or indirectly
owned capital stock or other equity interests are owned free and clear of any Liens. All
the issued and outstanding shares of capital stock of each Subsidiary are duly authorized, validly issued, fully paid, non-assessable
and free of preemptive and similar rights to subscribe for or purchase securities.

 

3.              
Public Reports; Financial Statements. Company has
filed all required Public Reports for the one year preceding the Effective Date. As
of their respective dates or as subsequently amended, the Public Reports complied in all material respects with the requirements
of the Act and the Exchange Act and the rules and regulations of the Commission promulgated thereunder, as applicable, and none
of the Public Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were
made, not misleading. The financial statements of Company included in the Public Reports, as amended, comply in all material respects
with applicable accounting requirements and the rules and regulations of the Commission with respect thereto as in effect at the
time of filing. Such financial statements have been prepared in accordance with GAAP, except as may be otherwise specified in such
financial statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required
by GAAP, and fairly present in all material respects the financial position of Company and its consolidated subsidiaries as of
and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited
statements, to normal, immaterial, year-end audit adjustments.

 

    	6

    	 	

    
 

4.              
Material Changes. Except as specifically disclosed in the Public Reports, (a) there has been no event, occurrence or
development that has had, or that could reasonably be expected to result in, a Material Adverse Effect, (b) Company has not incurred
any liabilities (contingent or otherwise) other than (i) trade payables and accrued expenses incurred in the ordinary course of
business consistent with past practice, and (ii) liabilities not required to be reflected in Company’s financial statements
pursuant to GAAP or required to be disclosed in filings made with the Commission, (c) Company has not altered its method of accounting,
(d) Company has not declared or made any dividend or distribution of cash or other property to its stockholders or purchased, redeemed
or made any agreements to purchase or redeem any shares of its capital stock, and (e) Company has not issued any equity securities
to any officer, director or Affiliate, except pursuant to existing Company equity incentive plans. Company does not have pending
before the Commission any request for confidential treatment of information.

 

5.              
Litigation.  There is no Action which could reasonably
be expected to result in a Material Adverse Effect. Neither Company nor any Subsidiary, nor to
the knowledge of Company any director or officer thereof, is or has been the subject of any Action involving a claim of
violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty. There has not been, and
to the knowledge of Company, there is not pending or contemplated, any investigation by the Commission involving Company or any
current or former director or officer of Company.

 

6.              
Labor Relations. No material labor dispute exists
or, to the knowledge of Company, is imminent with respect to any of the employees of Company, which could reasonably be expected
to result in a Material Adverse Effect.

 

7.              
Compliance. Neither Company nor any Subsidiary (a)
is in material default under or in material violation of (and no event has occurred that has not been waived that, with notice
or lapse of time or both, would result in a default by Company or any Subsidiary under), nor has Company or any Subsidiary received
notice of a claim that it is in material default under or that it is in material violation of, any indenture, loan or credit agreement
or any other similar agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or
not such default or violation has been waived), (b) is in violation of any order of any court, arbitrator or governmental body,
or (c) is or has been in violation of any statute, rule or regulation of any governmental authority, including without limitation
all foreign, federal, state and local laws applicable to its business except in each case as could not have a Material Adverse
Effect.

 

8.              
Regulatory Permits. Company and each Subsidiary possess all certificates, authorizations and permits issued by the appropriate
federal, state, local or foreign regulatory authorities necessary to conduct their respective businesses as described in the Public
Reports, except where the failure to possess such permits could not, individually or in the aggregate, have or reasonably be expected
to result in a Material Adverse Effect (“Material Permits”), and neither Company nor any Subsidiary has received
any notice of proceedings relating to the revocation or modification of any Material Permit.

 

    	7

    	 	

    
 

9.              
Title to Assets. Company and each Subsidiary have good and
marketable title in fee simple to all real property owned by them that is material to the business of Company and each Subsidiary
and good and marketable title in all personal property owned by them that is material to the business of Company and each
Subsidiary, in each case free and clear of all Liens, except for Liens that do not materially affect the value of such property
and do not materially interfere with the use made and proposed to be made of such property by Company and each Subsidiary and Liens
for the payment of federal, state or other taxes, the payment of which is neither delinquent nor subject to penalties. Any real
property and facilities held under lease by Company and each Subsidiary are held by them under valid, subsisting and enforceable
leases of which Company and each Subsidiary are in compliance.

 

10.           
Patents and Trademarks. Company and each Subsidiary
have, or have rights to use, all patents, patent applications, trademarks, trademark applications, service marks, trade names,
copyrights, licenses and other similar rights that are necessary or material for use in connection with their respective businesses
as described in the Public Reports and which the failure to so have could have a Material Adverse Effect (collectively, “Intellectual
Property Rights”). Neither Company nor any Subsidiary has received a written notice that the Intellectual Property Rights
used by Company or any Subsidiary violates or infringes
upon the rights of any Person. To the knowledge of Company, all such Intellectual Property Rights are enforceable and there is
no existing infringement by another Person of any of the Intellectual Property Rights of Company or each Subsidiary.

 

11.           
Insurance.  Company and each Subsidiary are insured by insurers of recognized financial responsibility against such
losses and risks and in such amounts as are prudent and customary in the businesses in which Company and each Subsidiary are engaged,
including but not limited to directors and officers insurance coverage at least equal to the Purchase Amount. To Company’s
knowledge, such insurance contracts and policies are accurate and complete in all material respects. Neither Company nor any Subsidiary
has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or
to obtain similar coverage from similar insurers as may be necessary to continue its business without a significant increase in
cost.

 

12.           
Transactions With Affiliates and Employees. Except as set forth in the Public Reports, none of the officers or directors
of Company and, to the knowledge of Company, none of the employees of Company is presently a party to any transaction with Company
or any Subsidiary (other than for services as employees, officers and directors), including any contract, agreement or other arrangement
providing for the furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring
payments to or from any officer, director or such employee or, to the knowledge of Company, any entity in which any officer, director,
or any such employee has a substantial interest or is an officer, director, trustee or partner, in each case in excess of $120,000
other than (i) for payment of salary or consulting fees for services rendered, (ii) reimbursement for expenses incurred on behalf
of Company and (iii) for other employee benefits, including stock option agreements under any equity incentive plan of Company.

 

13.           
Sarbanes-Oxley; Internal Accounting Controls. Company is in material compliance with all provisions of the Sarbanes-Oxley
Act of 2002, which are applicable to it as of the date of the Closing. Company presented in its most recently filed periodic report
under the Exchange Act the conclusions of the certifying officers about the effectiveness of Company’s disclosure controls
and procedures based on their evaluations as of the evaluation date. Since such date, there have been no significant changes in
Company’s internal accounting controls or its disclosure controls and procedures or, to Company’s knowledge, in other
factors that could materially affect Company’s internal accounting controls or its disclosure controls and procedures.

 

    	8

    	 	

    
 

14.           
Certain Fees. Company shall pay all brokerage or finder’s fees or commissions to any broker, financial advisor
or consultant, finder, placement agent, investment banker, bank or other Person with respect to the transactions contemplated by
this Agreement. Notwithstanding any other provision, Purchaser will have no obligation with respect to any fees or with respect
to any claims made by or on behalf of other Persons for fees of a type contemplated in this section that may be due in connection
with the transactions contemplated by this Agreement or the other Transaction Documents.

 

15.           
Registration Rights. No Person has any right to cause Company to effect the registration under the Act of any securities
of Company.

 

16.           
Listing and Maintenance Requirements. The Common Stock is registered pursuant to Section 12 of the Exchange
Act, and Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration
of the Common Stock under the Exchange Act nor has Company received any notification that the Commission is contemplating terminating
such registration. Except as disclosed in the Public Reports, Company has not, in the 12 months preceding the Effective Date, received
notice from any Trading Market on which the Common Stock is or has been listed or quoted to the effect that Company is not in compliance
with the listing or maintenance requirements of such Trading Market.
Company is, and has no reason to believe that it will not in the foreseeable future continue to be, in compliance with all such
listing and maintenance requirements.

 

17.           
Application of Takeover Protections. Company and its Board of Directors have taken all necessary action, if any, in
order to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under
a rights agreement) or other similar anti takeover provision under Company’s Certificate of Incorporation (or similar charter
documents) or the laws of its state of incorporation that is or could become applicable to Purchaser as a result of Purchaser and
Company fulfilling their obligations or exercising their rights under the Transaction Documents, including without limitation Company’s
issuance of the Shares and Purchaser’s ownership of the Shares.

 

18.           
Tax Status. Company and each of its Subsidiaries
has made or filed all federal, state and foreign income and all other tax returns, reports and declarations required by any jurisdiction
to which it is subject (unless and only to the extent that Company and each of its Subsidiaries has set aside on its books provisions
reasonably adequate for the payment of all unpaid and unreported taxes). Company has not executed a waiver with respect to the
statute of limitations relating to the assessment or collection of any foreign, federal, statue or local tax. None of Company’s
tax returns is presently being audited by any taxing authority.

 

19.           
Foreign Corrupt Practices. Neither Company, nor to the knowledge of Company, any agent or other person acting on behalf
of Company, has (a) directly or indirectly, used any corrupt funds for unlawful contributions, gifts, entertainment or other unlawful
expenses related to foreign or domestic political activity, (b) made any unlawful payment to foreign or domestic government officials
or employees or to any foreign or domestic political parties or campaigns from corporate funds, (c) failed to disclose fully any
contribution made by Company, or made by any person acting on its behalf of which Company is aware, which is in violation of law,
or (d) violated in any material respect any provision of the Foreign Corrupt Practices Act of 1977, as amended.

 

    	9

    	 	

    
 

 

20.           
Accountants. Company’s accountants are set forth in
the Public Reports and such accountants are an independent registered public accounting firm as required by the Act.

 

21.           
No Disagreements with Accountants or Lawyers. There are no material disagreements presently existing, or reasonably
anticipated by Company to arise, between Company and the accountants or lawyers formerly or presently employed by Company.

 

22.           
Acknowledgments Regarding Purchaser. Company’s decision to enter into this Agreement has been based solely on
the independent evaluation of Company and its representatives, and Company acknowledges and agrees that:

 

a.            
Purchaser is acting solely in the capacity of arm’s length purchaser with respect to this Agreement and the transactions
contemplated hereby;

 

b.            
Purchaser does not make or has not made any representations or warranties with respect to the transactions contemplated hereby
other than those specifically set forth in Section III.C

below; and

 

c.             
Purchaser is not acting as a legal, financial, accounting or tax advisor to Company, or fiduciary of Company, or in any similar
capacity, with respect to this Agreement and the transactions contemplated hereby. Any statement made by Purchaser or any of its
representatives or agents in connection with this Agreement and the transactions contemplated hereby is not advice or a recommendation,
and is merely incidental to Purchaser’s purchase of the Shares.

 

C.               
Representations and Warranties of Purchaser.
Purchaser hereby represents and warrants as of the Purchase Closing as follows:

 

1.              
Organization; Authority. Purchaser is an entity validly existing and in good standing under the laws of
the jurisdiction of its organization with full right, company power and authority to enter into and to consummate the transactions
contemplated by the Transaction Documents and otherwise to carry out its obligations thereunder. The execution, delivery and performance
by Purchaser of the transactions contemplated by this Agreement have been duly authorized by all necessary company or similar action
on the part of Purchaser. Each Transaction Document, to which it is a party has been, or will be, duly executed by Purchaser, and
when delivered by Purchaser in accordance with the terms hereof, will constitute the valid and legally binding obligation of Purchaser,
enforceable against it in accordance with its terms, except (a) as limited by general equitable principles and applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally,
(b) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies, and
(c) insofar as indemnification and contribution provisions may be limited by applicable law.

 

2.              
Purchaser Status.  At the time Purchaser was offered the Shares, it was, and at the Effective Date it is an “accredited
investor” as defined in Rule 501(a) under the Act.

 

    	10

    	 	

    
 

3.              
Experience of Purchaser. Purchaser, either alone or together with its representatives, has such knowledge, sophistication
and experience in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment
in the Shares, and has so evaluated the merits and risks of such investment. Purchaser is able to bear the economic risk of an
investment in the Shares and, at the present time, is able to afford a complete loss of such investment.

 

4.              
Ownership.  Purchaser is acquiring the Shares as principal for its own account. Purchaser is acquiring the Shares hereunder
in the ordinary course of its business.

 

5.              
No Short Sales. Purchaser (a) does not hold any short position in, and (b) has not engaged in any Short Sales of, the
Common Stock prior to the Effective Date.

 

IV.            
Securities Provisions.

 

A.              
Purchaser Due Diligence. Purchaser will
have the right and opportunity to conduct customary due diligence with respect to any Registration Statement or Prospectus in which
the name of Purchaser or any Affiliate of Purchaser appears. 

 

B.              
Furnishing of Information. As long as
Purchaser owns any Shares, Company covenants to timely file, or obtain extensions in respect thereof and file within the applicable
grace period, all reports required to be filed by Company after the Effective Date pursuant to the Exchange Act. As long as Purchaser
owns any Shares, if Company is not required to file reports pursuant to such laws, it will prepare and furnish to Purchaser and
make publicly available in accordance with Rule 144(c) such information as is required for Purchaser to sell the Shares under Rule
144. Company further covenants that it will take such further action as any holder of Shares may reasonably request, all to the
extent required from time to time to enable such Person to sell such Shares without registration under the Act within the limitation
of the exemptions provided by Rule 144.

 

C.               
Integration. Company will not sell, offer
for sale or solicit offers to buy or otherwise negotiate in respect of any security, as defined in Section 2 of the Act, that would
be integrated with the offer or sale of the Shares in a manner that would be integrated with the offer or sale of the Shares to
Purchaser for purposes of the rules and regulations of any Trading Market such that it would require stockholder approval prior
to the closing of such other transaction unless stockholder approval is obtained before the closing of such subsequent transaction.

 

D.              
Disclosure and Publicity. Company will
notify Purchaser prior to issuing any current report, press release, public statement or communication with respect to the transactions
contemplated hereby.

 

E.               
Shareholders Rights Plan.  No claim will
be made or enforced by Company or, to the knowledge of Company, any other Person that Purchaser is an “Acquiring Person”
under any shareholders rights plan or similar plan or arrangement in effect or hereafter adopted by Company, or that Purchaser
could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving Shares under the Transaction
Documents or under any other agreement between Company and Purchaser. Company will conduct its business in a manner so that it
will not become subject to the Investment Company Act of 1940, as amended.

 

    	11

    	 	

    
 

F.               
No Non-Public Information. Company covenants
and agrees that neither it nor any other Person acting on its behalf will, provide Purchaser or its agents or counsel with any
information that Company believes or reasonably should believe constitutes material non-public information. On and after the Effective
Date, neither Purchaser nor any Affiliate of Purchaser will have any duty of trust or confidence that is owed directly, indirectly,
or derivatively, to Company or the stockholders of Company, or to any other Person who is the source of material non-public information
regarding Company. Company understands and confirms that Purchaser will be relying on the foregoing in effecting transactions in
securities of Company, including without limitation sales of the Shares.

 

G.              
Indemnification of Purchaser.

 

1.              
Obligation to Indemnify. Subject to the provisions
of this Section IV.G, Company will indemnify and hold Purchaser, its Affiliates, and
each of their directors, officers, shareholders, partners, employees, agents and attorneys, and any person who controls Purchaser
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act (collectively, “Purchaser Parties”
and each a “Purchaser Party”), harmless from any and all losses, liabilities,
obligations, claims, contingencies, damages, reasonable costs and expenses, including all judgments, amounts paid in settlements,
court costs and reasonable attorneys’ fees and costs of investigation (collectively, “Losses”) that any Purchaser
Party may suffer or incur as a result of or relating to (a) any breach of any of the representations, warranties, covenants or
agreements made by Company in this Agreement or in the other Transaction Documents, (b) any action instituted against any Purchaser
Party, or any of them or their respective Affiliates, by any stockholder of Company who is not an Affiliate of a Purchaser Party,
with respect to any of the transactions contemplated by the Transaction Documents, (c) any untrue statement or
alleged untrue statement of a material fact contained in a Registration Statement, or in a Registration Statement as amended
by any post-effective amendment thereof by Company, or arising out of or based upon any omission or
alleged omission to state a material fact required to be stated therein or necessary to make the statements therein not
misleading, (d) any untrue statement or alleged untrue statement of a material fact included
in any Prospectus, or any amendments or supplements to any Prospectus, in any free writing prospectus,
in any “issuer information” as defined in Rule 433 under the Act, of Company, or in any Prospectus
together with any combination of one or more of the free writing prospectuses, if any, or arising out of or based upon
any omission or alleged omission to state a material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; or (e) any Purchaser Party becoming
involved in any capacity in any proceeding by or against any Person who is a stockholder of Company, as a result of Purchaser’s
acquisition of the Shares under this Agreement; provided, however, that Company shall not be obligated to indemnify any
Purchaser Party for any Losses finally adjudicated to be caused solely by a false statement of material fact contained within
written information provided by such Purchaser Party expressly for the purpose of including it in the applicable Registration
Statement. 

 

2.              
Procedure for Indemnification. If any action will be brought against a Purchaser Party in respect of which indemnity
may be sought pursuant to this Agreement, such Purchaser Party will promptly notify Company in writing, and Company will have the
right to assume the defense thereof with counsel of its own choosing. Purchaser Parties will have the right to employ separate
counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel will be at the expense
of Purchaser Parties except to the extent that (a) the employment thereof has been specifically authorized by Company in writing,
(b) Company has failed after a reasonable period of time to assume such defense and to employ counsel or (c) in such action there
is, in the reasonable opinion of such separate counsel, a material conflict with
respect to the dispute in question on any material issue between the position of Company and the position of
Purchaser Parties such that it would be inappropriate for one counsel to represent Company and Purchaser Parties. Company
will not be liable to Purchaser Parties under this Agreement (i) for any settlement by a Purchaser Party effected without Company’s
prior written consent, which will not be unreasonably withheld or delayed; or (ii) to the extent, but only to the extent that a
loss, claim, damage or liability is either attributable to Purchaser’s
breach of any of the representations, warranties, covenants or agreements made by Purchaser in this Agreement or in the other Transaction
Documents.

 

    	12

    	 	

    
 

3.              
No Purchaser Party will have any liability to Company or any Person asserting
claims on behalf of or in right of Company as a result of acquiring the Shares under this
Agreement.

 

H.              
Reservation of Shares. Company shall at all times maintain
a reserve from its duly authorized Common Stock for issuance pursuant to the Transaction Documents authorized shares of Common
Stock in an amount equal to thrice the number of shares sufficient to immediately issue all shares of Common Stock potentially
issuable upon any conversion of the Preferred Shares based upon the then current market price of the Common Stock. 

 

I.                
Activity Restrictions. For so long as
Purchaser or any of its Affiliates holds any Shares, neither Purchaser nor any Affiliate will: (i) vote any shares of Common Stock
owned or controlled by it, sign or solicit any proxies, or seek to advise or influence any Person with respect to any voting securities
of Company; (ii) engage or participate in any actions, plans or proposals which relate to or would result in (a) acquiring additional
securities of Company, alone or together with any other Person, which would result in beneficially owning or controlling more than
9.99% of the total outstanding Common Stock or other voting securities of Company, (b) an extraordinary corporate transaction,
such as a merger, reorganization or liquidation, involving Company or any of its subsidiaries, (c) a sale or transfer of a material
amount of assets of Company or any of its subsidiaries, (d) any change in the present board of directors or management of Company,
including any plans or proposals to change the number or term of directors or to fill any existing vacancies on the board, (e)
any material change in the present capitalization or dividend policy of Company, (f) any other material change in Company’s
business or corporate structure, including but not limited to, if Company is a registered closed-end investment company, any plans
or proposals to make any changes in its investment policy for which a vote is required by Section 13 of the Investment Company
Act of 1940, (g) changes in Company’s charter, bylaws or instruments corresponding thereto or other actions which may impede
the acquisition of control of Company by any Person, (h) causing a class of securities of Company to be delisted from a national
securities exchange or to cease to be authorized to be quoted in an inter-dealer quotation system of a registered national securities
association, (i) a class of equity securities of Company becoming eligible for termination of registration pursuant to Section
12(g)(4) of the Act, or (j) any action, intention, plan or arrangement similar to any of those enumerated above; or (iii) request
Company or its directors, officers, employees, agents or representatives to amend or waive any provision of this section.

 

    	13

    	 	

    
 

J.                
Variable Rate Transaction. Except as set forth in the
Disclosure Schedule, until 90 days after the effectiveness of a Registration Statement, Company and each Subsidiary shall be prohibited
from discussing, negotiating, effecting or entering into an agreement, plan, arrangement or understanding to effect any transaction
with a third party other than Purchaser or its Affiliates in which the Company or any Subsidiary (i) issues or sells, agrees to
issue or sell, or may issue or sell, any Common Stock or security convertible or exchangeable into Common Stock, either (a) at
a conversion, exercise or exchange rate or other price that is based upon or varies with the trading prices of, or quotations for,
the shares of Common Stock at any time after the initial issuance of such securities, or (b) with a conversion, exercise or exchange
price that is subject to being reset at some future date after the initial issuance of such securities, or upon the occurrence
of specified or contingent events directly or indirectly related to the business of the Company or the market for the Common Stock,
or (ii) enters into any agreement (including, without limitation, an equity line of credit, at the market offering or ATM) whereby
the Company or any Subsidiary issues or sells, agrees to issue or sell, or may issue or sell, any Common Stock or other security
at a future determined price.

 

K.              
No Shorting. Purchaser will not engage in or effect,
directly or indirectly, any Short Sale within one year of the Effective Date.

 

L.               
Suspension of Closings. Company may at
any time, in its sole and absolute discretion, suspend or terminate further Closings. If, during the 12 months before or after
doing so, Company obtains any other financing it will pay Purchaser a break-up fee of 120 shares of Preferred. 

 

V.              
General Provisions.

 

A.              
Notice. Unless a different time of day
or method of delivery is set forth in the Transaction Documents, any and all notices or other communications or deliveries required
or permitted to be provided hereunder will be in writing and will be deemed given and effective on the earliest of: (a) the date
of transmission, if such notice or communication is delivered via facsimile or electronic mail prior to 5:00 p.m. Eastern time
on a Trading Day and an electronic confirmation of delivery is received by the sender, (b) the next Trading Day after the date
of transmission, if such notice or communication is delivered later than 5:00 p.m. Eastern time or on a day that is not a Trading
Day, (c) the next Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or
(d) upon actual receipt by the party to whom such notice is required to be given. The addresses for such notices and communications
are such other address as may be designated in writing, in the same manner, by such Person.

 

B.              
Amendments; Waivers. No provision of this
Agreement may be waived or amended except in a written instrument signed, in the case of an amendment, by Company and Purchaser
or, in the case of a waiver, by the party against whom enforcement of any such waiver is sought. No waiver of any default with
respect to any provision, condition or requirement of this Agreement will be deemed to be a continuing waiver in the future or
a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor will any delay or omission
of either party to exercise any right hereunder in any manner impair the exercise of any such right.

 

C.               
Successors and Assigns. This Agreement
will be binding upon and inure to the benefit of the parties and their successors and permitted assigns. Company may not assign
this Agreement or any rights or obligations hereunder without the prior written consent of Purchaser, which consent will not be
unreasonably withheld. Purchaser may assign any or all of its rights under this Agreement (a) to any Affiliate, or (b) to any Person
to whom Purchaser assigns or transfers any Shares, provided such transferee agrees to be bound by the provisions hereof with respect
to the transferred Shares and Purchaser remains primarily responsible for the performance of its obligations under this Agreement.

 

    	14

    	 	

    
 

D.              
No Third-Party Beneficiaries. This Agreement
is intended for the benefit of the parties hereto and their respective successors and permitted assigns and is not for the benefit
of, nor may any provision hereof be enforced by, any other Person, except as otherwise set forth in Section IV.J.

 

E.               
Fees and Expenses. Company will pay the
reasonable fees and costs of Purchaser’s counsel incurred in connection with this Agreement, the other Transaction Documents,
the Purchase Closing, and the transactions contemplated hereby and thereby. Except as otherwise provided in this Agreement, each
party will pay the fees and expenses of its own advisers, counsel, accountants and other experts, if any, and all other expenses
incurred by such party incident to the negotiation, preparation, execution, delivery and performance of the Transaction Documents.
Company acknowledges and agrees that Purchaser’s counsel solely represents Purchaser, and does not represent Company or its
interests in connection with the Transaction Documents or the transactions contemplated thereby. Company will pay all stamp and
other taxes and duties levied in connection with the sale of the Shares, if any.

 

F.               
Severability. If any provision of this
Agreement is held to be invalid or unenforceable in any respect, the validity and enforceability of the remaining terms and provisions
of this Agreement will not in any way be affected or impaired thereby and the parties will attempt to agree upon a valid and enforceable
provision that is a reasonable substitute therefor, and upon so agreeing, will incorporate such substitute provision in this Agreement.

 

G.              
Replacement of Certificates.
If any certificate or instrument evidencing any Shares is mutilated, lost, stolen or destroyed, Company will issue or cause to
be issued in exchange and substitution for and upon cancellation thereof, or in lieu of and substitution therefor, a new certificate
or instrument, but only upon receipt of evidence reasonably satisfactory to Company of such loss, theft or destruction and customary
and reasonable indemnity, if requested. The applicants for a new certificate or instrument under such circumstances will also pay
any reasonable third-party costs associated with the issuance of such replacement certificates.

 

H.              
Governing Law. All questions concerning
the construction, validity, enforcement and interpretation of the Transaction Documents will be governed by and construed and enforced
in accordance with the laws of the State of New York, without regard to the principles of conflicts of law that would require or
permit the application of the laws of any other jurisdiction. The parties hereby waive all rights to a trial by jury. If either
party will commence an action or proceeding to enforce any provisions of the Transaction Documents, then the prevailing party in
such action or proceeding will be reimbursed by the other party for its reasonable attorneys’ fees and other costs and expenses
reasonably incurred in connection with the investigation, preparation and prosecution of
such action or proceeding.

 

I.                
Arbitration. Any dispute, controversy,
claim or action of any kind arising out of or relating to this Agreement, or in any way involving Company and Purchaser or their
respective Affiliates, will be resolved by final and binding arbitration before a retired judge at JAMS (www.jamsadr.com), or its
successor, in Santa Monica, California, pursuant to its most Streamlined Arbitration Rules and Procedures and the Final Offer (or
Baseball) Arbitration Option. Any interim or final award may be entered and enforced by any court of competent jurisdiction. The
final award will include the prevailing party’s reasonable arbitration, expert witness and attorney fees, costs and expenses.

 

    	15

    	 	

    
 

J.                
Remedies. In addition to being entitled
to exercise all rights provided herein or granted by law, including recovery of damages, each of Purchaser and Company will be
entitled to specific performance under the Transaction Documents, and injunctive relief to prevent any actual or threatened breach
under the Transaction Documents, to the full extent permitted under federal and state securities laws.

 

K.              
Payment Set Aside. To the extent that
Company makes a payment or payments to Purchaser pursuant to any Transaction Document or Purchaser enforces or exercises its rights
thereunder, and such payment or payments or the proceeds of such enforcement or exercise or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside, recovered from, disgorged by or are required to be refunded, repaid or otherwise
restored to Company, a trustee, receiver or any other person under any law, including, without limitation, any bankruptcy law,
state or federal law, common law or equitable cause of action, then to the extent of any such restoration the obligation or part
thereof originally intended to be satisfied will be revived and continued in full force and effect as if such payment had not been
made or such enforcement or setoff had not occurred.

 

L.               
Headings.
The headings herein are for convenience only, do not constitute a part of this Agreement and will not be deemed to limit or affect
any of the provisions hereof

 

M.             
Time of the Essence.  Time is of the essence
with respect to all provisions of this Agreement that specify a time for performance.

 

N.              
Survival.  The representations and warranties
contained herein will survive the Purchase Closing and the delivery of the Shares until all Preferred Shares issued to Purchaser
or any Affiliate have been converted or redeemed.

 

O.              
Construction. 
The parties agree that each of them and/or their respective counsel has reviewed and had an opportunity to revise the Transaction
Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting
party will not be employed in the interpretation of the Transaction Documents or any amendments hereto. The
language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no
rules of strict construction will be applied against any party.

 

P.              
Execution. This Agreement may be executed
in two or more counterparts, all of which when taken together will be considered one and the same agreement and will become effective
when counterparts have been signed by each party and delivered to the other party, it being understood that both parties need not
sign the same counterpart. In the event that any signature is delivered by portable document format, facsimile or electronic transmission,
such signature will create a valid and binding obligation of the party executing (or on whose behalf such signature is executed)
with the same force and effect as if such signature page were an original thereof.

 

    	16

    	 	

    
 

Q.              
Entire Agreement. This Agreement, including
the Exhibits hereto, which are hereby incorporated herein by reference, contains the entire
agreement and understanding of the parties, and supersedes all prior and contemporaneous
agreements, term sheets, letters, discussions, communications and understandings, both oral
and written, which the parties acknowledge have been merged into this Agreement. No party, representative,
attorney or agent has relied upon any collateral contract, agreement, assurance, promise, understanding or representation
not expressly set forth hereinabove. The parties hereby expressly waive all rights and remedies, at law and in equity, directly
or indirectly arising out of or relating to, or which may arise as a result of, any Person’s reliance on any such assurance.

 

IN WITNESS WHEREOF,
the parties hereto have caused this Agreement to be duly executed by their respective authorized signatories as of the Effective
Date.

 

Company:

 

VELATEL GLOBAL COMMUNICATIONS, INC.

 

 

By:  /s/ George Alvarez                      

Name:
George Alvarez                       

Title:
CEO                                            

 

 

Purchaser:

 

IRONRIDGE TECHNOLOGY CO.,

a division of IRONRIDGE GLOBAL IV, LTD.

 

 

By:  /s/ Peter Cooper                        

Name:
Peter Cooper                        

Title:
Director                                   

 

 

    	17

    	 	

    
 

Exhibit 1

 

Glossary of Defined Terms

 

“Act”
means the Securities Act of 1933, as amended, and the rules and regulations promulgated by the Commission thereunder.

 

“Action”
has the meaning set forth in Section III.A.41

 

“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common
control with a Person, as such terms are used in and construed under Rule 144 under the Act.

 

“Agreement”
means this Preferred Stock Purchase Agreement.

 

“Bloomberg”
means Bloomberg Financial Markets, or its successor performing similar functions.

 

“Certificate
of Designations” means the certificate to be filed with the Secretary of State of the State of Nevada, in the form attached
hereto as Exhibit 2.

 

“Closing”
has the meaning set forth in Section II.D.

 

“Closing Price”
means, for any security as of any date, the last closing bid price for such security on the Trading Market, as reported by Bloomberg,
or, if the Trading Market begins to operate on an extended hours basis and does not designate the closing bid price, then the last
bid price of such security prior to 4:00 p.m. Eastern time, as reported by Bloomberg, or, if the Trading Market is not the principal
securities exchange or trading market for such security, the last closing bid price of such security on the principal securities
exchange or trading market where such security is listed or traded as reported by Bloomberg, or if the foregoing do not apply,
the last closing bid price of such security in the over-the-counter market on the electronic bulletin board for such security as
reported by Bloomberg, or, if no closing bid price is reported for such security by Bloomberg, the average of the bid prices of
any market makers for such security as reported in the “pink sheets” by Pink Sheets LLC (formerly the National Quotation
Bureau, Inc.). All such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination or other
similar transaction during the applicable calculation period.

 

“Commission”
means the U.S. Securities and Exchange Commission.

 

“Common Shares”
includes the Shares of Common Stock issuable upon conversion of the Preferred Shares.

 

“Common Stock”
means the Series A Common Stock of Company and any replacement or substitute thereof, or any share capital into which such Common
Stock will have been changed or any share capital resulting from a reclassification of such Common Stock.

 

“Company”
has the meaning set forth in the first paragraph of the Agreement.

 

 

    	18

    	 	

    
 

“Disclosure
Schedules” means the disclosure schedules of Company delivered concurrently herewith. The Disclosure Schedules will contain
no material non-public information.

 

“DTC”
means The Depository Trust Company, or any successor performing substantially the same function for Company.

 

“DWAC Shares”
means all Shares or other shares of Common Stock issued or issuable
to Purchaser or any Affiliate, successor or assign of Purchaser pursuant to any of the Transaction Documents, all of which will
be (a) issued in electronic form, (b) freely tradable and without restriction on resale, and (c) timely credited by Company
to the specified Deposit/Withdrawal at Custodian (DWAC) account
with DTC under its Fast Automated Securities Transfer (FAST) Program or any similar program hereafter adopted by DTC performing
substantially the same function, in accordance with irrevocable instructions issued to and countersigned by the Transfer Agent,
in the form attached hereto as Exhibit 3.

 

“Equity Conditions”
has the meaning set forth in the Debentures and the Certificate of Designations.

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated by the Commission
thereunder.

 

“Effective
Date” has the meaning set forth in the first paragraph of the Agreement.

 

“GAAP”
means U.S. generally accepted accounting principles applied on a consistent basis during the periods involved.

 

“Indebtedness”
means (a) any liabilities for borrowed money or amounts owed in excess of $100,000, other than trade accounts payable incurred
in the ordinary course of business, (b) all guaranties, endorsements and other contingent obligations in respect of Indebtedness
of others, whether or not the same are or should be reflected in Company’s
balance sheet, or the notes thereto, except guaranties by endorsement of negotiable instruments for deposit or collection or similar
transactions in the ordinary course of business; and (c) the present value of any lease payments in excess of $100,000 due under
leases required to be capitalized in accordance with GAAP.

“Intellectual
Property Rights” has the meaning set forth in Section III.B.10.

 

“Liens”
means a lien, charge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.

 

“Material
Adverse Effect” includes any material adverse effect on (a) the legality, validity or enforceability of any Transaction
Document, or (b) the results of operations, assets, business, prospects or financial condition of Company and the Subsidiaries,
taken as a whole, which is not disclosed in the Public Reports prior to the Effective Date, or (c) a Company’s ability to
perform in any material respect on a timely basis its obligations under any Transaction Document.

 

“Material
Permits” has the meaning set forth in Section III.B.8.

 

    	19

    	 	

    
 

 

“Officer’s
Closing Certificate” means a certificate executed by an authorized officer of Company, in the form attached as Exhibit
5.

 

“Opinion”
means an opinion from Company’s independent legal counsel, in the form attached as Exhibit 4.

 

“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government, or an agency or subdivision thereof, or other entity of any kind.

 

“Preferred
Shares” means shares of Series B Preferred Stock of Company provided for in the Certificate of Designations, to be issued
to Purchaser pursuant to this Agreement.

 

“Prospectus”
means the final prospectus filed for the Registration Statement.

 

“Prospectus
Supplement” means the supplement to the Prospectus complying with Rule 424(b) of the Securities Act that is filed with
the Commission and delivered by the Company to each Purchaser at the Closing

 

“Public Reports”
includes all reports required to be filed by Company under the Act
or the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the two years preceding the Effective Date
and thereafter.

 

“Purchase
Amount” has the meaning set forth in Section II.A.1.

 

“Purchaser”
has the meaning set forth in the first paragraph of the Agreement.

 

“Registration
Statement” means a valid, current and effective shelf Registration Statement on Form S-3 or Form S-1, registering for
sale the Shares, and except where the context otherwise requires, means the Registration Statement, including the prospectus therein,
amendments and supplements to such Registration Statement or prospectus, including pre- and post-effective amendments, all exhibits
thereto, and all material incorporated by reference or deemed to be incorporated by reference in such registration statement, and
any information contained or incorporated by reference in a prospectus filed with the Commission in connection with the Registration
Statement, to the extent such information is deemed under the Act to be part of any registration statement.

 

“Secretary’s
Certificate” means a certificate, the form of which is attached as Exhibit 6, signed by the secretary of Company.

 

“Shares”
include the Preferred Shares and the Common Shares.

 

“Short Sale”
means a “short sale” as defined in Rule 200 of Regulation SHO of the Exchange Act.

 

“Subsidiary”
means any Person Company owns or controls, or in which Company, directly or indirectly, owns a majority of the capital stock or
similar interest that would be disclosable pursuant to Regulation S-K, Item 601(b)(21).

    	20

    	 	

    
 

 

“Trading
Day” means any day on which the Common Stock is traded on the Trading Market; provided
that it will not include any day on which the Common Stock is (a) scheduled to trade for less than 5 hours, or (b) suspended from
trading.

 

“Trading
Market” means whatever is at the time the principal U.S. trading exchange or market for
the Common Stock.

 

“Transaction
Documents” means this Agreement, the other agreements, certificates and documents referenced herein or the form of which
is attached hereto, and the exhibits, schedules and appendices hereto and thereto.

 

“Transfer
Agent” means the Company’s current transfer agent, or any successor transfer agent for the Common Stock.

 

    	21

    	 	

    
 

Exhibit 2

 

Form of Certificate of Designations

 

VELATEL GLOBAL COMMUNICATIONS, INC.

 

CERTIFICATE OF DESIGNATIONS OF PREFERENCES,

RIGHTS AND LIMITATIONS

OF

SERIES B PREFERRED STOCK

 

The undersigned, ____________________ and
____________________, hereby certify that:

 

1.They are the
____________________ and ____________________, respectively, of VelaTel
Global Communications, Inc., a Nevada corporation (the “Corporation”).

 

2.The Corporation
is authorized to issue 25,000,000 shares of preferred stock, of which none are currently issued and outstanding.

 

3.The following
resolutions were duly adopted by the Board of Directors:

 

WHEREAS, the Certificate
of Incorporation of the Corporation provides for a class of its authorized stock known as preferred stock, comprised of 25,000,000
shares (the “Preferred Stock”), issuable from time to time in one or more series;

 

WHEREAS, the Board
of Directors of the Corporation is authorized to fix the dividend rights, dividend rate, voting rights, conversion rights, rights
and terms of redemption and liquidation preferences of any wholly unissued series of Preferred
Stock and the number of shares constituting any Series and the designation thereof, of any of them;

 

WHEREAS, it is the
desire of the Board of Directors of the Corporation, pursuant to its authority as aforesaid and as set forth in this Certificate
of Designations of Preferences, Rights and Limitations of Series B Preferred Stock, to designate the rights, preferences, restrictions
and other matters relating to the Series B Preferred Stock,
which will consist of up to 2,500 shares of the Preferred Stock
which the Corporation has the authority to issue, as follows:

 

NOW, THEREFORE, BE
IT RESOLVED, that the Board of Directors does hereby provide for the issuance of a series of Preferred
Stock for cash or exchange of other securities, rights or property and does hereby fix and determine the rights, preferences,
restrictions and other matters relating to such series of Preferred
Stock as follows:

 

I.                
Terms of Preferred Stock.

 

A.              
Designation, Amount and Par Value. The series of Preferred
Stock will be designated as the Corporation’s Series B Preferred Stock (the “Series B Preferred Stock”)
and the number of shares so designated will be 2,500, which will not be subject to increase without any consent of the holders
of the Series B Preferred Stock (each a “Holder” and collectively, the “Holders”) that may
be required by applicable law.

 

    	22

    	 	

    
 

The Series B Preferred
Stock will, with respect to dividend rights and rights upon liquidation, winding-up or dissolution, rank: (a) senior with respect
to dividends and right of liquidation with the Corporation’s Series A Common Stock (“Common Stock”); and
(b) junior to all existing and future indebtedness of the Corporation.

 

2.              
Voting. Without the prior written consent of a majority of Holders, the Company may not issue any Series B Preferred
Stock, or Preferred Stock that is not junior to the Series B Preferred Stock in right of dividends and liquidation. Except as required
by applicable law or as set forth herein, the holders of shares of Series B Preferred Stock will have no right to vote on any matters,
questions or proceedings of this Corporation including, without limitation, the election of directors.

 

C.               
Dividends.

 

1.              
Commencing on the date of the issuance of any such shares of Series B Preferred Stock (each respectively an “Issuance
Date”), Holders of Series B Preferred Stock will be entitled to non-cumulative dividends on each outstanding share of
Series B Preferred Stock (“Dividends”), at a rate equal to 2.50% per annumAny calculation of the amount of such
Dividends payable pursuant to the provisions of this Section I.C. will be made based on a 365-day year, compounded annually.

 

2.              
Dividends and any Embedded Derivative Liability are payable at the Corporation’s election, (a) in cash, or (b) in registered
and free trading shares of Common Stock registered pursuant to a current and effective registration statement on file with the
U.S. Securities & Exchange Commission, valued at 81.0% of the following: the Closing Price of the Common Stock on the date
of delivery, not to exceed the Closing Price on any Trading Day during the Equity Conditions Measuring Period.

 

3.              
So long as any shares of Series B Preferred Stock are outstanding, no dividends or other distributions will be paid, declared
or set apart with respect to any Common Stock, unless the amount of any Dividends are first paid to the holders of Series B Preferred
Stock. The Common Stock will not be redeemed while the Series B Preferred Stock is outstanding.

 

D.              
Protective Provision. So long as any shares of Series B Preferred Stock are outstanding, the Corporation will not, without
the affirmative approval of the Holders of a majority of the shares of the Series B Preferred Stock then outstanding (voting as
a class), (i) alter or change adversely the powers, preferences or rights given to the Series B Preferred Stock or alter or amend
this Certificate of Designations, (ii) authorize or create any class of stock ranking as to distribution of dividends senior to
the Series B Preferred Stock, (iii) amend its certificate of incorporation
or other charter documents in breach of any of the provisions hereof, (iv) increase the authorized number of shares of Series
B Preferred Stock, (v) liquidate, dissolve or wind-up the business and affairs of the Corporation,
or effect any Deemed Liquidation Event (as defined below), or (vi) enter into any agreement with respect to the foregoing.

 

    	23

    	 	

    
 

1.              
A “Deemed Liquidation Event” will mean: (a) a merger or consolidation in which the Corporation is a constituent
party or a subsidiary of the Corporation is a constituent party and the Corporation issues shares of its capital stock pursuant
to such merger or consolidation, except any such merger or consolidation involving the Corporation or a subsidiary in which the
shares of capital stock of the Corporation outstanding immediately prior to such merger or consolidation continue to represent,
or are converted into or exchanged for shares of capital stock that represent, immediately following such merger or consolidation,
at least a majority, by voting power, of the capital stock of the surviving or resulting corporation or if the surviving or resulting
corporation is a wholly owned subsidiary of another corporation immediately following such merger or consolidation, the parent
corporation of such surviving or resulting corporation; or (b) the sale, lease, transfer, exclusive license or other disposition,
in a single transaction or series of related transactions, by the Corporation or any subsidiary of the Corporation of all or substantially
all the assets of the Corporation and its subsidiaries taken as a whole, or the sale or disposition (whether by merger or otherwise)
of one or more subsidiaries of the Corporation if substantially all of the assets of the Corporation and its subsidiaries taken
as a whole are held by such subsidiary or subsidiaries, except where such sale, lease, transfer, exclusive license or other disposition
is to a wholly owned subsidiary of the Corporation.

 

2.              
The Corporation will not have the power to effect a Deemed Liquidation
Event referred to in Section I.D.1 unless the agreement or plan of merger or consolidation for such transaction provides
that the consideration payable to the stockholders of the Corporation will be allocated among the holders of capital stock of the
Corporation in accordance with Section I.E.

 

E.               
Liquidation.

 

1.              Upon
any liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, after payment or provision for
payment of debts and other liabilities of the Corporation, pari passu with any distribution or payment made to the holders of
Common Stock by reason of their ownership thereof, the Holders of Series B Preferred Stock will be entitled to be paid out of
the assets of the Corporation available for distribution to its stockholders an amount with respect to each share of Series B
Preferred Stock equal to $10,000.00, plus any accrued but unpaid Dividends
thereon (collectively, the “Series A

 

2.              
If, upon any liquidation, dissolution or winding up of the Corporation, the assets of the Corporation will be insufficient
to make payment in full to all Holders, then such assets will be distributed among the Holders at the time outstanding, ratably
in proportion to the full amounts to which they would otherwise be respectively entitled.

 

F.               
Redemption.

 

1.              
Corporation’s Redemption Option.  Upon or after 18 years after the Issuance
Date (“Derivative Maturity Date”), the Corporation will have the right, at the Corporation’s option, to
redeem all or a portion of the shares of Series B Preferred Stock, at a price per share equal to 100% of the Series A Liquidation
Value (the “Corporation Redemption Price”).

 

    	24

    	 	

    
 

2.              
Early Redemption. Prior to redemption pursuant to Section I.F.1 hereof, the Corporation will have the right,
at the Corporation’s option, to redeem all or a portion of the shares of Series B Preferred Stock at any time or times after
the Issuance Date of such Series B Preferred Stock, at a price per share (the “Early Redemption Price”) equal
to the sum of the following: (a) the Corporation Redemption Price, plus (b) the Embedded Derivative Liability on the date of the
applicable redemption or conversion, less (c) any Dividends that have been paid.

 

3.              
Credit Risk Adjustment. Notwithstanding any other provision, the Embedded Derivative Rate shall adjust upward by an
amount equal to the Credit Spread Adjustment for each amount, if any, equal to the Adjustment Factor, or any portion thereof that
the Measuring Metric falls below the Minimum Triggering Level; provided, however, that in no event shall the Embedded Derivative
Rate exceed the Maximum Rate. The Embedded Derivative Rate shall adjust downward by an amount equal to the Credit Spread Adjustment
for each amount, if any, equal to the Adjustment Factor that the Measuring Metric rises above the Maximum Triggering Level; provided,
however, that in no event shall the Embedded Derivative Rate be below the Minimum Rate.

 

4.              
Mandatory Redemption.  If the Corporation determines to liquidate, dissolve or wind-up its business and affairs, or
effect any Deemed Liquidation Event, the Corporation will redeem the Series B Preferred Stock at the applicable Early Redemption
Price set forth in Section I.F.2.

 

5.              
Mechanics of Redemption. If the Corporation elects to redeem any of the Holders’
Series B Preferred Stock then outstanding, it will deliver written notice thereof via facsimile and overnight courier (“Notice
of Redemption at Option of Corporation”) to each Holder, which Notice of Redemption at Option of Corporation will indicate
(a) the number of shares of Series B Preferred Stock that the Corporation is electing to redeem and (b) the applicable Early Redemption
Price or Corporation Redemption Price.

 

6.              
Payment of Redemption Price. Upon receipt by any Holder of a Notice of Redemption at Option of Corporation, such Holder
will promptly submit to the Corporation such Holder’s Series B Preferred Stock certificates. Upon receipt of such Holder’s
Series B Preferred Stock certificates, the Corporation will pay the Corporation Redemption Price or Early Redemption Price, as
applicable, to such Holder in cash.

 

G.              
Conversion.

 

1.              
Mechanics of Conversion.

 

a.               
Subject to the terms and conditions hereof, one or more of the Series B Preferred Stock may be converted, in part or in whole,
into shares of Common Stock, at any time or times after the Issuance Date, at the option of Holder or the Corporation, by (i) if
at the option of Holder, delivery of a written notice to the Corporation (the “Holder Conversion Notice”), of
the Holder’s election to convert the Series B Preferred Stock, or (ii) if at the option of the Corporation, if the Equity
Conditions are met, delivery of a written notice to Holder (the “Corporation Conversion Notice” and, with the
Holder Conversion Notice, each a “Conversion Notice”), of the Corporation’s election to convert the Series
B Preferred Stock. On the same Trading Day on which the Corporation has received the Holder Conversion Notice or issued the Corporation
Conversion Notice (as the case may be) by 11:59 a.m. Eastern time, or the following Trading Day if received after such time or
on a non-Trading Day, the Corporation shall transmit by facsimile or electronic mail an acknowledgment of confirmation of receipt
of the Holder Conversion Notice or issuance of the Corporation Conversion Notice to the Holder and the Corporation’s transfer
agent (the “Transfer Agent”) and shall either (a) issue and surrender to a common carrier for overnight delivery
to the address as specified in the notice of exercise a certificate bearing no restrictive legend, registered in the name of the
Purchaser or its designee, for the number of Shares to which the Purchaser is entitled upon conversion of as set forth in the notice,
or (b) provided the Company is approved through DTC, authorize the credit by the Transfer Agent of such aggregate number of Conversion
Shares to which the Holder is entitled pursuant to such Conversion Notice to Holder’s or its designee’s balance account
with The Depository Trust Corporation (DTC) Fast Automated Securities Transfer (FAST) Program, through its Deposit/Withdrawal at
Custodian (DWAC) system, time being of the essence.

 

    	25

    	 	

    
 

b.              
No fractional shares of Common Stock are to be issued upon conversion of Series B Preferred Stock, but rather the Corporation
shall issue to Holder scrip or warrants in registered form (certificated or uncertificated) which shall entitle Holder to receive
a full share upon the surrender of such scrip or warrants aggregating a full share.

 

c.               
The Holder shall not be required to deliver the original certificates for the Series B Preferred Stock in order to effect a
conversion hereunder.

 

d.              
The Corporation shall pay any and all taxes which may be payable with respect to the issuance and delivery of Conversion Shares
to Holder.

 

2.              
Holder Conversion. In the event of a conversion of any Series B Preferred Stock pursuant to an Holder Conversion Notice,
the Corporation shall issue to the Holder of such Series B Preferred Stock a number of Conversion Shares equal to (a) the Early
Redemption Price multiplied by (b) the number of such Series B Preferred Stock subject to the Holder Conversion Notice divided
by (c) the Conversion Price with respect to such Series B Preferred Stock.

 

3.              
Corporation Conversion. In the event that the Closing Price of the Common Stock exceeds 300% of the Conversion Price
with respect to a Series B Preferred Stock for any 20 consecutive Trading Days, upon a conversion of any Series B Preferred Stock
pursuant to a Corporation Conversion Notice, the Corporation shall issue to the Holder of such Series B Preferred Stock a number
of Conversion Shares equal to (a) the Early Redemption Price multiplied by (b) the number of such Series B Preferred Stock subject
to the Corporation Conversion Notice divided by (c) the Conversion Price with respect to such Series B Preferred Stock.

 

4.              
Stock Splits. If the Corporation at any time on or after the Issuance Date subdivides (by any stock split, stock dividend,
recapitalization or otherwise) one or more classes of its outstanding shares of Common Stock into a greater number of shares, the
Conversion Price, Adjustment Factor, Maximum Triggering Level and Minimum Triggering Level in effect immediately prior to such
subdivision will be proportionately reduced and the number of Conversion Shares will be proportionately increased. If the Corporation
at any time on or after such Issuance Date combines (by combination, reverse stock split or otherwise) one or more classes of its
outstanding shares of Common Stock into a smaller number of shares, the Conversion Price, Adjustment Factor, Maximum Triggering
Level and Minimum Triggering Level in effect immediately prior to such combination will be proportionately increased and the number
of Conversion Shares will be proportionately decreased. Any adjustment under this Section 4.c shall become effective at the close
of business on the date the subdivision or combination becomes effective.

 

    	26

    	 	

    
 

5.              
Rights. In addition to any adjustments pursuant to Section I.G.4, if at any time the Corporation grants, issues
or sells any options, convertible securities or rights to purchase stock, warrants, securities or other property pro rata to the
record holders of any class of shares of Common Stock (the “Purchase Rights”), then Holder will be entitled
to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which Holder could have acquired if
Holder had held the number of shares of Common Stock acquirable upon conversion of all Preferred Stock held by Holder immediately
before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken,
the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase
Rights.

 

6.              
Definitions.  For purposes of this Section I.G, the following terms shall have the following meanings:

 

a.               
“Adjustment Factor” means $0.0050 per share of Common Stock.

 

b.              
“Conversion Price” means a price per share of Common Stock equal to $0.20 per share of Common Stock, subject
to adjustment as otherwise provided herein.

 

c.               
“Conversion Shares” means shares of Common Stock issuable upon conversion of Series B Preferred Stock.

 

d.              
“Closing Price” means, for any security as of any date, the last closing bid price for such security on
the Trading Market, as reported by Bloomberg, or, if the Trading Market begins to operate on an extended hours basis and does not
designate the closing bid price, then the last bid price of such security prior to 4:00 p.m., Eastern time, as reported by Bloomberg,
or, if the Trading Market is not the principal securities exchange or trading market for such security, the last closing bid price
of such security on the principal securities exchange or trading market where such security is listed or traded as reported by
Bloomberg, or if the foregoing do not apply, the last closing bid price of such security in the over-the-counter market on the
electronic bulletin board for such security as reported by Bloomberg, or, if no closing bid price is reported for such security
by Bloomberg, the lowest bid price of any market maker for such security as reported in the “pink sheets” by Pink Sheets
LLC (formerly the National Quotation Bureau, Inc.).

 

e.               
“Credit Spread Adjustment” means 98.4860 basis points.

 

f.               
“Embedded Derivative Liability” for each share
of Series B Preferred Stock means the Corporation Redemption Price, multiplied by the product of (i) the Embedded Derivative Rate
on the date of determination of the Embedded Derivative Liability, and (ii) the number of whole years between the Issuance Date
and the Derivative Maturity Date. 

 

g.              
“Embedded Derivative Rate” means 8.00% per
annum, subject to adjustment. 

 

 

    	27

    	 	

    
 

h.              
“Equity Conditions” means (i) on each day during the period beginning 30 Trading Days prior to the
applicable date of determination and ending 30 Trading Days after the applicable date of determination (the “Equity Conditions
Measuring Period”), the Common Stock is designated for quotation on the Trading Market and shall not have been suspended
from trading on such exchange or market nor shall delisting or suspension by such exchange or market been threatened or pending
either (A) in writing by such exchange or market or (B) by falling below the then effective minimum listing maintenance requirements
of such exchange or market; (ii) during the Equity Conditions Measuring Period, the Corporation shall have delivered Conversion
Shares upon all conversions or redemptions of the Series B Preferred Stock in accordance with their terms to the Holder on a timely
basis; (iii) the Corporation shall have no knowledge of any fact that would cause both of the following (1) a registration statement
not to be effective and available for the issuance of the Conversion Shares; and (2) Section 3(a)(9) under the Securities Act of
1933, as amended, not to be available for the issuance of the Conversion Shares, or Securities Act Rule 144 not to be available
for the resale of all the Conversion Shares underlying the Series B Preferred Stock; (iv) a minimum of $3.0 million in aggregate
trading volume has traded on the Trading Market during the 20 Trading Dates prior to the date of determination; and (v) the Corporation
otherwise shall have been in compliance with and shall not have breached any provision, covenant, representation or warranty of
any Transaction Document.

 

i.                
“Maximum Rate” means 27.0% per annum.

 

j.                
“Maximum Triggering Level” means $0.220 per share of Common Stock.

 

k.              
“Measuring Metric” means the Closing Price of the Common Stock on any Trading Day following the Issuance
Date of the Series B Preferred Stock.

 

l.                
“Minimum Rate” means 2.0% per annum.

 

m.             
“Minimum Triggering Level” means $0.1850 per share of Common Stock.

 

n.              
“Trading Day” means any day on which the Common Stock is traded on the Trading Market; provided that it
shall not include any day on which the Common Stock is (i) scheduled to trade for less than 5 hours, or (ii) suspended from trading.

 

o.               
“Trading Market” means whatever is at the time the principal U.S. trading exchange or market for the Common
Stock.

 

7.              
Conversion Limitation. Notwithstanding any other provision, at no time may the Corporation or Holder deliver a Conversion
Notice if the number of Conversion Shares to be received pursuant to such Conversion Notice, aggregated with all other shares of
Common Stock then beneficially (or deemed beneficially) owned by Holder, would result in Holder owning, on the date of delivery
of the Conversion Notice, more than 9.99% of all Common Stock outstanding as determined in accordance with Section 13(d) of the
Exchange Act and the rules and regulations promulgated thereunder. No Corporation Conversion Notice
may be issued with respect to more than 30 Preferred Shares with respect to any Equity Conditions Measuring Period.

 

H.              
Register. The Corporation will keep at its principal office,
or at the offices of the transfer agent, a register of the Series B Preferred Stock, which shall be prima facie indicia
of ownership of all outstanding shares of Series B Preferred Stock. Upon the surrender of any certificate representing Series B
Preferred Stock at such place, the Corporation, at the request of the record Holder of such certificate, will execute and deliver
(at the Corporation’s expense) a new certificate or certificates
in exchange therefor representing in the aggregate the number of shares represented by the surrendered certificate. Each such new
certificate will be registered in such name and will represent such number of shares as is requested by the Holder of the surrendered
certificate and will be substantially identical in form to the surrendered certificate.

 

    	28

    	 	

    
 

II.              
Miscellaneous.

 

A.              
Notices. Any and all notices to the Corporation will be addressed to the Corporation’s
Chief Executive Officer at the Corporation’s principal
place of business on file with the Secretary of State of the State of Nevada.
Any and all notices or other communications or deliveries to be provided by the Corporation to any Holder hereunder will be in
writing and delivered personally, by electronic mail or facsimile, sent by a nationally recognized overnight courier service addressed
to each Holder at the facsimile telephone number or address of such Holder appearing on the books of the Corporation, or if no
such facsimile telephone number or address appears, at the principal place of business of the Holder. Any notice or other communication
or deliveries hereunder will be deemed given and effective on the earliest of (1) the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile telephone number specified in this Section II.A prior to 5:30 p.m. Eastern time,
(2) the date after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile telephone
number specified in this section later than 5:30 p.m. but prior to 11:59 p.m. Eastern time on such date, (3) the second business
day following the date of mailing, if sent by nationally recognized overnight courier service, or (4) upon actual receipt by the
party to whom such notice is required to be given.

 

B.              
Lost or Mutilated Preferred Stock Certificate. Upon receipt of evidence reasonably satisfactory to the Corporation (an
affidavit of the registered Holder will be satisfactory) of the ownership and the loss, theft, destruction or mutilation of any
certificate evidencing shares of Series B Preferred Stock, and in the case of any such loss, theft or destruction upon receipt
of indemnity reasonably satisfactory to the Corporation (provided that
if the Holder is a financial institution or other institutional investor its own agreement will be satisfactory) or in the
case of any such mutilation upon surrender of such certificate, the Corporation will, at its expense, execute and deliver in lieu
of such certificate a new certificate of like kind representing the number of shares of such class represented by such lost, stolen,
destroyed or mutilated certificate and dated the date of such lost, stolen, destroyed or mutilated certificate.

 

C.               
Headings. The headings contained herein are for convenience only, do not constitute a part of this Certificate of Designations
and will not be deemed to limit or affect any of the provisions hereof.

 

    	29

    	 	

    
 

RESOLVED, FURTHER,
that the chairman, chief executive officer, chief financial officer,
president or any vice-president, and the secretary or any assistant secretary, of the Corporation be and they hereby are
authorized and directed to prepare and file a Designation of Preferences, Rights and Limitations of Series B Preferred Stock in
accordance with the foregoing resolution and the provisions of Nevada
law.

 

IN WITNESS WHEREOF,
the undersigned have executed this Certificate this 14th day
of December 2012.

 

Signed:
                                      

Name:                                       

Title:
                                      

 

 

Signed:
                                      

Name:                                       

Title:
                                      

 

 

    	30

    	 	

    
 

 

Exhibit 3

 

Form of Transfer Agent Instructions

 

[Letterhead of VelaTel Global Communications,
Inc.]

 

December 14, 2012

 

[Transfer Agent Name and Address]

 

Re:VelaTel Global Communications, Inc.

 

Ladies and Gentlemen:

 

In accordance with
the Preferred Stock Purchase Agreement (“Agreement”), dated December 14, 2012, by and between VelaTel Global
Communications, Inc., a Nevada corporation (“Company”), and Ironridge Technology Co., a division of Ironridge
Global IV, Ltd., a British Virgin Islands business company (“Purchaser”), pursuant to which Company may issue
and deliver shares (“Shares”) of Company’s Series A Common Stock (“Common Stock”) upon
conversion of shares of Series B Preferred Stock, this will serve as our irrevocable authorization and direction to you (provided
that you are the transfer agent of Company at such time), in the event the Company or the Purchaser issues a Conversion Notice
to issue the Shares. Capitalized terms used herein without definition will have the respective meanings ascribed to them in the
Agreement.

 

Upon your receipt of
a copy of the Notice executed by the Company, you will use your best efforts to, within one (1) Trading Day following the date
of receipt of the Conversion Notice, (a) issue and surrender to a common carrier for overnight delivery to the address as specified
in the notice of exercise a certificate, registered in the name of the Purchaser or its designee, for the number of Shares to which
the Purchaser is entitled upon conversion of as set forth in the notice, or (b) provided you are participating in The Depository
Trust Company (DTC) Fast Automated Securities Transfer (FAST) Program, upon the request of the Purchaser, credit such aggregate
number of Shares to which the Purchaser is entitled to the Purchaser’s or its designee’s balance account with DTC through
its Deposit Withdrawal At Custodian (DWAC) system provided the Purchaser causes its bank or broker to initiate the DWAC transaction.

 

Company hereby confirms
that the Shares should not be subject to any stop-transfer restrictions and will otherwise be freely transferable on the books
and records of Company. If the Shares are certificated, the certificates will not bear any legend restricting transfer of the shares
represented thereby.

 

Company hereby confirms
that no instructions other than as contemplated herein will be given to you by Company with respect to the Shares. Company hereby
agrees that it will not replace you as Company’s transfer agent, until such time as Company provides written notice to you
and Purchaser that a suitable replacement has agreed to serve as transfer agent and to be bound by the terms and conditions of
this letter agreement regarding Irrevocable Transfer Agent Instructions (this “Agreement”).

 

    	31

    	 	

    
 

Company and you hereby
acknowledge and confirm that complying with the terms of this Agreement does not and will not prohibit you from satisfying any
and all fiduciary responsibilities and duties you may owe to Company.

 

Company must keep its
bill current with you – if Company is not current and is on suspension, the Purchaser will have the right to pay Company’s
outstanding bill, in order for you to act upon this Agreement. If the outstanding bill is not paid by Company or the Purchaser,
you have no further obligation under this Agreement.

 

The above instructions
cannot be revoked, cancelled or modified without prior written approval of Purchaser.

 

IN WITNESS WHEREOF,
the parties have caused this letter agreement regarding Transfer Agent Instructions to be duly executed and delivered as of the
date first written above.

 

 

VELATEL GLOBAL COMMUNICATIONS, INC.

 

By:                                               

Name:                                          

Title:                                            

 

 

    	32

    	 	

    
 

Exhibit 4

 

Form of Legal Opinion

 

We
are counsel to VelaTel Global Communications, Inc., a Nevada
corporation (“Company”), in connection with the sale and issuance of shares
(“Preferred Shares”) of Company’s Series B Preferred Stock (“Preferred Stock”),
convertible into shares (“Common Shares”) of Company’s Series A Common Stock (“Common Stock”)
(“Purchaser”), (the Preferred Shares and Common Shares, collectively, “Shares”) pursuant
to the terms of the Preferred Stock Purchase Agreement dated as of December 14, 2012 (“Agreement”, and collectively
with all documents and agreements related to or arising from the Agreement, the “Transaction Documents”), by
and between Company and Purchaser. Capitalized terms not otherwise defined herein have the meanings set forth in the Transaction
Documents.

 

We are of the opinion
that, as of the date hereof:

 

1.               
Company is a corporation validly existing and in good standing under the laws of the State of Nevada.

 

2.               
The Shares are duly authorized and, when issued in accordance with the terms and conditions of the Agreement will be, legally
and validly issued, fully paid and non-assessable. The issuance of the Shares will not be subject to any statutory or, to our knowledge,
contractual preemptive rights of any stockholder of Company.

 

3.               
Company has the corporate power and authority to (a) execute, deliver and perform all of its obligations under the Agreement
and the Transaction Documents, and (b) issue, sell and deliver the Shares.

 

4.               
The execution, delivery and performance of the Agreement and the Transaction Documents have been duly authorized by all
necessary corporate action on the part of Company, and have been duly executed and delivered by Company.

 

5.               
Upon execution and delivery of the Agreement, the Agreement will constitute the legal, valid and binding obligation of Company,
enforceable against Company in accordance with its terms.

 

6.               
The execution and delivery of the Transaction Documents by Company does not, and Company’s performance of its obligations
thereunder will not (a) violate the Second Amended and Restated Certificate of Incorporation or the Amended and Restated By-Laws
of Company, as in effect on the date hereof, (b) violate in any material respect any federal or state law, rule or regulation,
or judgment, order or decree of any state or federal court or governmental or administrative authority, in each case that, to our
knowledge, is applicable to Company or its properties or assets and which could have a material adverse effect on Company’s
business, properties, assets, financial condition or results of operations or prevent the performance by Company of any material
obligation under the Agreement, or (c) to our knowledge, require the authorization, consent, approval of or other action of, notice
to or filing or qualification with, any state or federal governmental authority, except (i) as have been, or will be prior
to the Closing, duly obtained or made, or (ii) to the extent failure to be so obtained or made would not have a material adverse
effect on Company or its ability to consummate the transactions contemplated under the Agreement.

 

    	33

    	 	

    
 

7.               
To our knowledge, there is no claim, action, suit, proceeding, arbitration, investigation or inquiry, pending or threatened, before
any court or governmental or administrative body or agency, or any private arbitration tribunal, against Company that challenges
the validity or enforceability of, or seeks to enjoin the performance of, the Agreement.

 

8.               
Company is not, and immediately after the consummation of the transactions contemplated by the Agreement will not be, an
investment company within the meaning of Investment Company Act of 1940, as amended.

 

[9.               The Registration
Statement filed with the Commission, which registers the sale of the Shares to Purchaser is current and effective as of the date
hereof.

 

In
addition to the opinions above, nothing has come to our attention that has caused us to believe that the Registration Statement,
as of its effective date, or the Prospectus Supplement, as of its date or the date of its letter (in each case, except as
to the financial statements, schedules, notes, other financial and accounting data, and statistical data, included therein or derived
therefrom, as to which we express no opinion or belief), contained any untrue statement of material
fact, or failed to state a material fact necessary in order to make the facts stated therein, in light of the circumstances in
which they were made, not misleading.]

 

 

    	34

    	 	

    
 

Exhibit 5

 

Form of Officer’s Closing
Certificate

 

VELATEL GLOBAL COMMUNICATIONS, INC.

 

December 14, 2012

 

The undersigned hereby certifies that:

 

The
undersigned is the duly appointed [__________] of VelaTel Global Communications, Inc., a
Nevada corporation (“Company”).

 

This
Officer’s Closing Certificate (“Certificate”) is being delivered to Ironridge Technology Co., a
division of Ironridge Global IV, Ltd., a British Virgin Islands business company (“Purchaser”), by Company,
to fulfill the requirement under the Preferred Stock Purchase Agreement, dated as of December 14, 2012, between Purchaser and Company
(“Agreement”). Terms used and not defined in this Certificate have the meanings set forth in the Agreement.

 

The representations
and warranties of Company set forth in the Agreement are true and correct in all material respects as if made on the above date
(except for any representations and warranties that are expressly made as of a particular date, in which case such representations
and warranties will be true and correct as of such particular date), and no default has occurred under the Agreement, or any other
agreement with Purchaser or any Affiliate of Purchaser.

 

Company is not, and
will not be as a result of the applicable Closing, in default of the Agreement, any other agreement with Purchaser or any Affiliate
of Purchaser.

 

All of the conditions
to the Closing required to be satisfied by Company prior to such Closing have been satisfied in their entirety.

 

IN WITNESS WHEREOF,
the undersigned has executed this Officer’s Closing Certificate as of the date set forth above.

 

Signed:                                

Name:                                  

Title:                                    

 

    	35

    	 	

    
 

Exhibit 6

 

Form of Secretary’s Certificate

 

December 14, 2012

 

The undersigned hereby certifies that:

 

The undersigned is
the duly appointed Secretary of VelaTel Global Communications, Inc., a Nevada corporation (the “Company”).

 

This
Secretary’s Certificate (“Certificate”) is being delivered to Ironridge Technology Co., a division
of Ironridge Global IV, Ltd., a British Virgin Islands business company (“Purchaser”), by Company, to fulfill
the requirement under the Preferred Stock Purchase Agreement, dated as of December 14, 2012, between Purchaser and Company (“Agreement”).
Terms used and not defined in this Certificate have the meanings set forth in the Agreement.

 

Attached hereto as
Exhibit “A” is a true, correct and complete copy of the Certificate of Incorporation of Company, as in effect
on the Effective Date.

 

Attached hereto as
Exhibit “B” is a true, correct and complete copy of the Bylaws of Company, as in effect on the Effective Date.

 

Attached hereto as
Exhibit “C” is a true, correct and complete copy of the resolutions of the Board of Directors of Company authorizing
the Agreement, the Transaction Documents, and the transactions contemplated thereby. Such resolutions have not been amended or
rescinded and remain in full force and effect as of the date hereof.

 

IN WITNESS WHEREOF,
the undersigned has executed this Secretary’s Certificate as of the date set forth above.

 

Signed:                                 

Name:                                   

Title:                                     

 

 

    	36

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00210-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00210-of-00352.parquet"}]]