Metal Component Engineering Limited (Catalist:5DX) entered into a conditional sale and purchase agreement to acquire 51% stake in Asiafame Group Limited from Lu Wenge, Luk Yee Lin Ellen, Andrew Bek, Ai Mizoguchi, Cheng Wang and Kenji Takashi for SGD 8.4 million on February 15, 2019. As reported, an initial consideration of SGD 4.9 million will be paid on completion by way of the issuance to each of the vendors, a non-convertible, redeemable, transferable, zero coupon bond in the principal amount of SGD 2.4 million and subject to Asiafame Group’s net profits after tax for the financial period from January 1, 2019 to March 31, 2019 (the “1Q2019”) being equal to or more than CNY 1.8 million (SGD 0.36 million), an aggregate amount of SGD 3.5 million of deferred consideration shall be paid by Metal Component Engineering Limited to the vendors by way of the issuance to each of the vendors, a non-convertible, redeemable, transferable, zero coupon bond in the principal amount of SGD 1.75 million. An aggregate of 102 fully paid-up ordinary shares of Asiafame Group Limited will be acquired, following which Asiafame Group Limited will become a 51.0%-owned subsidiary of Metal Component Engineering Limited (MCEL). MCEL intends to fund the redemption of the bonds by a combination of internal resources as well as fund-raising from the equity market, commercial banks, sophisticated investors and strategic partners. As at March 31, 2018, the net book value of Asiafame Group Limited amounted to approximately SGD 1.98 million. The completion of the transaction is conditional upon MCEL being satisfied in its sole and absolute discretion with the results of the due diligence on Asiafame Group Limited, all necessary requirements under the Singapore Exchange Securities Trading Limited (the “SGX-ST”) Listing Manual Section B: Rules of Catalist (“Catalist Rules”) and all necessary consents or approvals (if any) being granted by third parties or governmental or regulatory bodies or competent authorities having jurisdiction over the proposed (including without limitation, the consent or approval of the SGX-ST (as applicable) in respect of the circular to be despatched to the Shareholders in relation to the proposed acquisition and/or the Business Diversification (if required and/or deemed necessary by MCEL), the receipt of approvals of the respective Board of Directors of MCEL, the vendors and Asiafame Group Limited for the transfer of the shares, MCEL receiving any necessary approvals from its shareholders at an extraordinary general meeting in respect of the acquisition, the appointment of such Directors nominated by MCEL to form part of Asiafame Group Limited’s Board of Directors and the appointment of such legal representative(s) (or person(s) of equivalent authority, however described) nominated by MCEL to Asiafame Group’s subsidiaries (as applicable), there being no adverse change in the global economy and the prospects, operations or financial condition of Asiafame Group occurring on or before completion, MCEL receiving the audited consolidated financial statements of Asiafame Group for the financial year ended December 31, 2018 indicating that Asiafame Group has net profits after tax of not less than CNY 0.8 million (SGD 0.16 million), MCEL commissioning an independent valuer to prepare a valuation report on Asiafame Group, and such valuation being not less than the consideration and the MCEL being satisfied with such valuation, the parties having executed a bond subscription agreement on mutually agreed terms to set out the terms and conditions in respect of the bonds and Metal Component Engineering undertaking a placement of new ordinary shares to raise funds of at least SGD 4 million prior to completion. Completion of the acquisition will take place not later than 14 business days after all the conditions precedent are fulfilled. If the conditions precedent have not been fulfilled or waived by mutual consent on or before August 31, 2019 or such date as all the parties may agree in writing, the agreement shall lapse and cease to have effect.