The Board of Directors of Hextar Industries Berhad announced that Global Aroma Sdn. Bhd. (GASB), a wholly-owned subsidiary of the Company, has on 29 November 2024, entered into a Master Development and Operating Agreement with Luckin Coffee Holding Singapore Pte.
Ltd. (collectively referred to as the Parties) for the purpose of obtaining the rights to develop, open and operate coffee shops under the Luckin Coffee name in Malaysia (Luckin Coffee Shops). Salient Terms of the Agreement: Rights: Subject to the terms of the Agreement, the Agreement grants GASB the rights as the exclusive franchisee to develop, open and operate Luckin Coffee Shops in Malaysia. Term: Ten years, with GASB's right to: request for a renewal for 2 successive 5-year terms; and request to extend the arrangement for a period not longer than 1 year from the expiration of the term or the renewal term.
Territory: Malaysia. Termination: Luckin has the right to terminate the Agreement upon the occurrence of certain events of default by GASB, including, among others, GASB's failure to comply with the development schedule or to make timely payments to Luckin and its affiliates, GASB's breach of its confidentiality and/or non-compete obligations or other representations and warranties related to GASB's and its affiliates' compliance with applicable laws, or GASB or any of its affiliates commits a fraud or criminal offence or engages in any conduct that Luckin believes may adversely affect the goodwill associated with the franchise system, or Luckin's reputation. GASB is afforded the opportunity to cure certain defaults in accordance with the cure periods set forth in the Agreement.
GASB also has the right to terminate the Agreement upon the occurrence of certain events of default by Luckin, including, among others, Luckin's breach or failure to fulfill its obligations under the Agreement, which defaults are not cured within the cure periods set forth in the Agreement, as applicable.
