Saudee : Circular to Shareholders

THIS CIRCULAR TO SHAREHOLDERS OF SAUDEE GROUP BERHAD ("SAUDEE" OR THE "COMPANY") IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION.

If you are in any doubt as to the course of action to be taken, you should consult your stockbroker, bank manager, solicitor, accountant or other professional advisers immediately.

Bursa Malaysia Securities Berhad takes no responsibility for the contents of this Circular, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this Circular.

SAUDEE GROUP BERHAD

(Registration No. 200801036832 (838172-P))

(Incorporated in Malaysia)

CIRCULAR TO SHAREHOLDERS IN RELATION TO THE

1. PROPOSED PRIVATE PLACEMENT OF UP TO 347,000,000 NEW ORDINARY SHARES IN SAUDEE, REPRESENTING APPROXIMATELY 35% OF THE TOTAL NUMBER OF ISSUED SHARES OF SAUDEE TO INDEPENDENT THIRD-PARTY INVESTORS TO BE IDENTIFIED AT A LATER DATE;

1. PROPOSED ESTABLISHMENT OF A SHARE ISSUANCE SCHEME OF UP TO 15% OF THE TOTAL NUMBER OF ISSUED SHARES OF SAUDEE (EXCLUDING TREASURY SHARES, IF ANY) TO THE ELIGIBLE DIRECTORS AND ELIGIBLE EMPLOYEES OF SAUDEE AND ITS SUBSIDIARIES; AND

1. PROPOSED ALLOCATION OF SIS OPTIONS PURSUANT TO THE SHARE ISSUANCE SCHEME ABOVE TO THE DIRECTORS OF THE COMPANY

AND

NOTICE OF EXTRAORDINARY GENERAL MEETING

Principal Adviser

TA SECURITIES HOLDINGS BERHAD

(Registration No. 197301001467 (14948-M))

(A Participating Organisation of Bursa Malaysia Securities Berhad)

The Extraordinary General Meeting of the Company ("EGM") will be held on a virtual basis from the Broadcast Venue at Level 4, Menara Lien Hoe, No. 8, Persiaran Tropicana, Tropicana Golf & Country Resort, 47410 Petaling Jaya, Selangor Darul Ehsan and online voting using the remote participation and voting platform. The Notice of EGM together with the Form of Proxy are enclosed in this Circular.

If you decide to appoint a proxy or proxies for the EGM, you must complete, sign and return the Form of Proxy and deposit it at the Poll Administrator's office at Level 5, Block B, Dataran PHB, Saujana Resort, Section U2, 40150 Shah Alam, Selangor Darul Ehsan or email to [e-mail] not less than 24 hours before the date and time indicated below or at any adjournment thereof. The completion and lodging of the Form of Proxy will not preclude you from attending and voting at the virtual EGM should you subsequently wish to do so and in such an event, your Form of Proxy shall be deemed to have been revoked.

Last date and time for lodging the Form of Proxy	:	Tuesday, 25 October 2022 at 10.30 a.m.
Date and time of the EGM	:	Wednesday, 26 October 2022 at 10.30 a.m.
Broadcast Venue of the EGM	:	Level 4, Menara Lien Hoe, No. 8, Persiaran Tropicana,
		Tropicana Golf & Country Resort, 47410 Petaling Jaya, Selangor
		Darul Ehsan

This Circular is dated 11 October 2022

DEFINITIONS

Except where the context otherwise requires, the following definitions shall apply throughout this Circular:

2020 Private Placement :	Private placement of up to 10% of the issued Shares, which was
		completed on 7 September 2020
2021 Private Placement :	Private placement of up to 20% of the issued Shares, which was
		completed on 16 December 2021
Act	: Companies Act 2016, as amended from time to time including any re-
		enactment thereof
Board	: Board of Directors of Saudee
BNM	:	Bank Negara Malaysia
Bursa Depository	: Bursa Malaysia Depository Sdn Bhd (198701006854 (165570-W))
Bursa Securities	: Bursa Malaysia Securities Berhad (200301033577 (635998-W))
By-laws	: By-laws governing the SIS, as amended, modified and supplemented
		from time to time in accordance with the provisions of the By-laws, a
		draft of which is appended in Appendix II of this Circular
Circular	: This circular to Shareholders in relation to the Proposals
Convertible Securities : Collectively, the Warrants B and Existing ESOS Options
COVID-19	: Coronavirus disease of 2019
Date of Offer	: The date of the letter in which an Offer is made by the SIS Committee
		to the Eligible Persons to participate in the SIS
Directors	: Directors	of the Company for the	time	being and shall	have the
		meaning ascribed to it in Section 2(1) of the Act and Section 2(1) of the
		Capital Markets and Services Act 2007 and Director shall be construed
		accordingly
Effective Date	: The date on which the SIS shall take effect, following full compliance
		with all relevant requirements prescribed under the Listing
		Requirements
EGM	:	Extraordinary general meeting
Eligible Directors	: Directors	(including executive	and	non-executive	Directors,
		independent or otherwise) of the Group who fulfil the eligibility criteria
		for participation in the SIS as set out in the By-laws
Eligible Employees	: Employees of the Group who fulfil the eligibility criteria for participation
		in the SIS as set out in the By-laws
Eligible Persons	: Collectively, the Eligible Directors and the Eligible Employees
EPS	:	Earnings per Share
Exercise Price	: The price at which a Grantee shall be entitled to subscribe for each
		new Share from the Company upon the exercise of the SIS Options,
		as specified in the Offer and as may be adjusted in accordance with
		the provisions of the By-laws

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DEFINITIONS (CONT'D)

Existing By-Laws	: Existing by-laws governing the Existing ESOS
Existing ESOS	: The existing employee share option scheme of the Company which
		took effect on 19 January 2018 for a period of 5 years
Existing ESOS Options :	Options granted under the Existing ESOS pursuant to the Existing By-
		Laws where each option holder can subscribe for 1 new Share for
		every 1 Existing ESOS Option held
FPE	: Financial period ended / ending, as the case may be
FYE	: Financial year ended / ending, as the case may be
GL	:	Gross loss
GP	:	Gross profit
Grantee	: An Eligible Person who has accepted an Offer in the manner provided
		in the By-laws
HORECA	: Hotel, restaurant and cafe
IMR Report	: Independent Market Research Report dated 17 August 2022 prepared
		by Smith Zander
Interested Person	: A director, major shareholder or chief executive of Saudee or a holding
		company of Saudee
LAT	:	Loss after taxation
LBT	:	Loss before taxation
Listing Requirements	: Main Market Listing Requirements of Bursa Securities
LPD	: 23 September 2022, being the latest practicable date prior to the
		printing of this Circular
LPS	:	Loss per Share
Maximum Scenario	: Assuming all the treasury shares are resold in the open market and full
		exercise of the outstanding Warrants B
Maximum Shares	: Maximum number of Shares that may be granted under the SIS and
		shall not in aggregate exceed 15% of the total number of issued shares
		of the Company (excluding treasury shares, if any) at any point in time
		during the duration of the SIS
Minimum Scenario	: Assuming none of the treasury shares are resold in the open market
		and none of the outstanding Warrants B are exercised
NA	:	Net assets
OEM	:	Original equipment manufacturer
Offer	: Written offer of SIS Options at the discretion of the SIS Committee, to
		an Eligible Person from time to time within the duration of the SIS
PAT	:	Profit after taxation

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DEFINITIONS (CONT'D)

PBT			:	Profit before taxation
Placement Shares	: Up to 347,000,000 new Saudee Shares to be issued pursuant to the
				Proposed Private Placement
Private Placement and	: Private placement of up to 61,882,400 Shares and renounceable rights
Rights	Issue	with		issue of up to 536,314,564 Shares together with up to 268,157,282 free
Warrants			detachable Warrants B on the basis of 2 rights shares together with 1
				free Warrant B for every 1 existing Share held by the entitled
				Shareholders on the entitlement date, which was completed on 23
				June 2021.
Proposals		: Collectively, the Proposed Private Placement and Proposed SIS
Proposed	Private	: Proposed private placement of up to 347,000,000 new Saudee Shares,
Placement			representing approximately 35% of the total number of issued shares
				of the Company to independent third-party investor(s) to be identified
				later and at an issue price to be determined later
Proposed SIS		: Proposed establishment of a SIS of up to 15% of the total number of
				issued Shares (excluding treasury shares, if any)
Record of Depositors	: A record of securities holders established by Bursa Depository under
				the Rules of Bursa Depository as issued pursuant to the Securities
				Industry (Central Depositories) Act, 1991, including the Securities
				Industry (Central Depositories) Amendment Act, 1998
RM and sen		: Ringgit Malaysia and sen respectively
Saudee	or	the	:	Saudee Group Berhad (200801036832 (838172-P))
Company
Saudee	Group	or the	:	Collectively, Saudee and its subsidiaries
Group
Saudee Shares or the	:	Ordinary shares in Saudee
Shares
Shareholders		: Registered holders of Saudee Shares
Smith	Zander	or the	:	Smith Zander International Sdn Bhd (201301028298 (1058128-V))
IMR
SIS			: Share issuance scheme for the granting of the SIS Options to the
				Eligible Persons to subscribe for new Shares upon the terms as set out
				in the By-laws, such scheme to be known as "Employees' Share
				Issuance Scheme"
SIS Committee		: The committee appointed and authorised by the Board from time to
				time to administer the SIS in accordance with the By-laws, comprising
				such number of Directors and/or other persons identified and
				appointed from time to time by the Board
SIS Options		: The right of a Grantee to subscribe for new Shares, during the SIS
				Option Period, at the Exercise Price pursuant to an Offer duly accepted
				by the Grantee

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DEFINITIONS (CONT'D)

SIS Option Period	: The period commencing from the Effective Date and expiring on (i) the
	last day of the duration of the SIS, or (ii) such other date as stipulated
	by the SIS Committee in the Offer, or (iii) on the date of termination or
	expiry of the SIS as provided in the By-laws
TA Securities or the	: TA Securities Holdings Berhad (197301001467 (14948-M))
Principal Adviser
VWAP	: Volume weighted average price
Warrants B	: Outstanding warrants 2021/2024 issued by the Company pursuant to
	the Deed Poll B which will expire on 16 June 2024. Each Warrant B
	holder is entitled to subscribe for 1 new Share at the exercise price of
	RM0.15, subject to adjustments under circumstances prescribed in
	accordance with the terms and provisions of the Deed Poll B

All references to "you" in this Circular are to the Shareholders.

In this Circular, words referring to the singular shall, where applicable, include the plural and vice versa and words importing the masculine gender shall, where applicable, include the feminine and neuter genders and vice versa. References to persons shall include corporations, unless otherwise specified.

Any reference in this Circular to any enactment is a reference to that enactment as for the time being amended or re-enacted. Any reference to time and date in this Circular shall be a reference to Malaysian time and date, unless otherwise stated. Any discrepancies in the tables between the actual figures, amounts stated and the totals in this Circular are, unless otherwise explained, due to rounding.

Certain statements in this Circular may be forward-looking in nature, which are subject to uncertainties and contingencies. Forward-looking statements may contain estimates and assumptions made by the Board after due enquiry, which are nevertheless subject to known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to differ materially from the anticipated results, performance or achievements expressed or implied in such forward-looking statements. In light of these and other uncertainties, the inclusion of a forward-looking statement in this Circular should not be regarded as a representation or warranty that the Company's plans and objectives will be achieved.

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