Business Overview

4. INFORMATION ON OUR GROUP 4. INFORMATION ON OUR GROUP 4.1 GROUP OVERVIEW 4.1.1 Our History And Share Capital Our Company was incorporated in Malaysia under the Act on 16 November 2010 under the name of Prestariang Sdn Bhd. Subsequently, on 15 December 2010, our Company was converted to a public limited company and assumed its present name. Our Company is an investment holding company with a wholly owned subsidiary, PSSB, which in turn is the holding company of LSB and PR&D. We are an ICT service provider focusing on ICT training and certification, and software licence distribution and management. For further details inclUding examples on our above mentioned activities, please refer to Section 4.3.2(iii)(a) and Section 4.3.2(iv) of this Prospectus, respectively. Dr Abu is the Promoter, substantial shareholder, Non-Independent Executive Director and Chief Executive Officer of our Group. He brings with him extensive experience having accumulated approximately 29 years of experience in the training and education fields. He has been instrumental in the development, growth and success of our Group. Over the years, under the leadership of Dr Abu, we have made a concerted effort to position ourselves as a reputable provider of ICT training and certification, and software licence distribution and management. The history of our business can be traced back to 2003 with the commencement of the business of LSB. The business activity of LSB was initially in the supply of computer hardware and provision of basic ICT literacy training. In the same year, PSSB was incorporated and its initial business activity was in the provision of ICT training. In 2004, LSB worked together with a technology partner namely FSBM Holdings Berhad, in introducing a teacher training programme in Malaysia. Subsequently, in the same year, LSB secured a contract with a value of RM1 08.25 million from the MOE for the BPPT Programme, to provide ICT literacy training for teachers in public primary and secondary schools in Malaysia. Our ICT literacy training modules, which were customised and localised to the Malaysian national curriculum, were aimed at training teachers to be competent managers capable of using ICT to create innovative teaching techniques. Under the BPPT Programme, LSB successfully trained approximately 100,000 teachers to integrate ICT into classroom teaching. LSB completed this programme in 2007. PR&D was incorporated in 2004 and it commenced business in 2005. Its initial business activity was in developing and providing flying simulation programmes. However, the programmes did not kick off due to poor response. As a result PR&D ceased its activities in 2006. In end 2010, it has commenced R&D activities to work on the new learning/training and certification programmes which include the English language learning and certification programme, Islamic finance training and certification programme as well as Green IT certification programme. In 2005, our Group, through PSSB, was granted the MSC Status and the Pioneer Status by the Government of Malaysia as represented by the MOF and the MITI, which the Pioneer Status had subsequently expired on 29 June 2010. On 29 September 2010, PSSB obtained a letter from the MITI for approval of extension of the Pioneer Status. The extension started from 30 June 2010 and is valid for another five (5) years. In 2006, PSSB was awarded a contract with a value of RM4.99 million by the MOHE for the pilot 3P Programme specifically for Universiti Teknologi MARA. This was our first professional ICT training and certification under the 3P Programme and involved 1,063 final year students and lecturers/staff from the Faculty of Information Technology and Quantitative Sciences, the Faculty of Electrical Engineering and the Faculty of Information Management.

 

4. INFORMATION ON OUR GROUP (Cont’d) From 2007 to 2010, PSSB has continued to obtain contracts which are renewable yearly from the MOHE for the 3P Programme. The value of these yearly renewable contracts was RM15.00 million each except for the contract for 2009 which had a value of RM20.00 million. In 2011, PSSB has obtained a new letter of award of RM80.00 million (RM20.00 million per year) from the MOHE to provide the 3P Programme to universities, polytechnics and community colleges as directed by the MOHE for a period of four (4) years. The 3P Programme aims to provide professional ICT training and certification to final year students of ICT and ICT related fields in public higher education institutions in Malaysia. Some of the certification courses include training in the use, application and provision of technical support for software products from Microsoft, IBM, Oracle, CompTIA, Autodesk, EC-Council, Adobe and others. As at the LPD, we offer approximately 40 certification courses, and there are approximately 18,790 participants who have participated in our professional ICT training and certification under the 3P Programme. In 2006, through PSSB, we expanded our business to include synergistic activities namely software licence distribution and management. We secured two (2) contracts from the MOHE for the MUSE Programme in parallel with the 3P Programme for the supply of Microsoft and Autodesk software licences to public higher education institutions in Malaysia, namely a three (3) plus two (2)-year contract of RM10.00 million per year and a three (3)-year contract of RM20.00 million per year respectively. The contract for the supply of Microsoft software licences has been renewed for a further period of two (2) years upon its expiration of three (3) years in 2009 and thereafter in 2011, PSSB has been awarded by the MOHE a new contract of RM40.00 million (RM10.00 million per year) for the supply of Microsoft software licences for a period of four (4) years effective from the expiration of the previous contract of two (2) years. Furthermore, upon the expiration of the Autodesk contract, we have been awarded a new contract of RM20.00 million from the MOHE for the supply of Autodesk software licences under the MUSE Programme for a period of three (3) years commencing from 2009. PSSB further extended its core competency in ICT training to integrate ICT into the healthcare industry. In 2008, we managed to secure a contract of RM13.59 million from the MOH for the ICMS Programme and we conducted this programme for five (5) months at three (3) Government healthcare training institutions, namely Bahagian Pengurusan Latihan in Kuala Lumpur, Kolej Jururawat Masyarakat Port Dickson in Negeri Sembilan and Kolej Pembantu Perubatan Alor Setar in Kedah. In the same year, as part of the Microsoft MLA, PSSB secured a three (3)-year contract worth RMO.17 million from the Ministry of Rural and Regional Development, Malaysia, to distribute and manage Microsoft software licence acquisitions for entities with more than 100 computers, under the purview of this Ministry. In 2009, PSSB was appointed by Microsoft (Malaysia) Sdn Bhd to provide ICT literacy training to civil servants and system integrators in Malaysia under the RBTCS Programme and vendor development programme respectively, coordinated by the MOF. This was for a period of three (3) years with the option to extend for an additional three (3) years. The actual number of civil servants to be trained is discussed and agreed with the MOF on a yearly basis. As at the LPD, we have provided ICT literacy training to approximately 1,660 civil servants under the RBTCS Programme. PSSB also launched a new “FlyingStart” pilot programme with our content partner, National Council for Graduate Entrepreneurship from the United Kingdom in 2009. The “FlyingStart” programme was aimed at providing intensive business start-up training to students. This programme was targeted at final year students across all disciplines from local public universities. We started the “FlyingStart” programme with two (2) public universities in Malaysia namely, Universiti Teknologi MARA and Universiti Malaysia Kelantan. As at the LPD, the “FlyingStart” programme has yet to generate any revenue. 4. INFORMATION ON OUR GROUP (Cont’d) In 2010, PSSB secured, among others, the following new contracts:­• a three (3)-year contract of RM21.48 million from the IRB to supply and manage Microsoft software licences for 8,000 computers and to provide ICT training; and
• a 20-month contract of RM12.00 million from the MOE to supply and manage Microsoft software licences for approximately 10,000 public schools and matriculation colleges in Malaysia under the EM Programme, which covers 300,000 computers.

In addition, in 2010, LSB obtained letters of agreement from Microsoft (Malaysia) Sdn Bhd whereby it was appointed as:­• a provider of ICT training for teachers and student development activities under the Partnership for Technology Access Initiative by the MOHE; and
• a provider of ICT training to students under the Malaysian Broadband PC Initiative sponsored by the Ministry of Information Communications and Culture, Malaysia.

We launched our first in-house developed ICT certification programme, namely “IC CITIZEN”, for the global market in 2010. Subsequently, we signed a partnership agreement with Certiport from the US, to market our “IC CITIZEN” certification programme on a global basis. Certiport has a network of approximately 10,000 centres in 142 countries. As this programme was only officially launched in November 2010, it has yet to generate any revenue as at the LPD. However, in April 2011, PSSB has obtained a letter of award of USD67,500 from the Authority for Info-communications Technology Industry of Brunei Darussalam to provide the “IC CITIZEN Training & Certification” and “IC CITIZEN Train the Trainer” programmes to 50 participants for each of the programmes. In 2011, PSSB has also secured a three (3) -year contract of RM8.05 million from the MOE to supply and manage Microsoft software licences for the District Academic Department, Institutes of Teacher Education and other MOE agencies (eXcluding matriculation colleges and schools). Shown in the table below is a summary of the BPPT, 3P and RBTCS training programmes undertaken by our Group:­Programme BPPT 3P RBTCS  Customer MOE MOHE Microsoft (Malaysia) Sdn Bhd  No. Of Participants Traine.d Up To The LPO Approximately 100,000 Approximately 18,790 Approximately 1,660  Commencement Year 2004 2006 2009  Completion Year 2007 (Completed) On-going On-going
Our Company’s authorised share capital is RM50,OOO,OOO comprising 500,000,000 ordinary shares of RMO.10 each, of which RM19,800,000 comprising 198,000,000 Shares have been issued and fully paid-up. 4. INFORMATION ON OUR GROUP (Cont’d) The changes in our Company’s issued and fully paid-up share capital since incorporation are set out below:­Date Of Allotment 16 November 2010 2 June 2011  No. Of Ordinary Shares Allotted 20 197,999,980  Par Value (RM) 0.10 0.10  Consideration Subscribers’ shares Acquisition of PSSB  Cumulative Issued And Fully Paid-Up Ordinary Share Capital (RM) 2 19,800,000
Upon completion of the Public Issue, our issued and paid-up share capital will increase to RM22,000,000 comprising 220,000,000 Shares. None of the above Shares were issued at a discount, on special terms or instalment payment terms. Our Company does not have any warrant, option or convertible securities in issue or any uncalled capital. 4.1.2 Corporate Structure Our Group’s corporate structure is depicted below:­
PSSB 100% 100% LSB PR&D [The Rest Of This Page Is Intentionally Left Blank] 4. INFORMATION ON OUR GROUP (Cont’d) The details of our subsidiaries are as follows:­Issued And  Effective  Company  Fully Paid-Up  Equity  (Registration Date/Place Of  Share Capital  Interest  No.) Incorporation  (RM)  (‘Yo) Principal Activities
PSSB 8 October 2003/  5,588,465  100 Provision of ICT training  (630804-K) Malaysia  and certification, and  software licence distribution  and management  Subsidiaries Of PSSB  LSB 9 April 2001/  500,000  100 Provision of ICT training{a),  (544324-T) Malaysia  and software licence  distribution and  management  PR&D 17 May 2004/  100,000  100 Research and development  (652573-X) Malaysia
Note:­(a) LSB currently provides ICT training without any certification. Further information on our subsidiaries are set out in Section 4.1.3 of this Prospectus. 4.1.3 Our Subsidiaries (i) PSSB (a) Background And Principal Activities And Products/Services PSSB was incorporated in Malaysia under the Act as a private limited company on 8 October 2003 under the name of To Create Consulting Sdn Bhd. The company changed to its present name of Prestariang Systems Sdn Bhd on 5 March 2004 and commenced operations in the same year. PSSB is principally involved in providing ICT training and certification as well as software licence distribution and management. (b) Share Capital As at the LPD, PSSB’s authorised share capital is RM10,OOO,000 comprising 9,800,000 PSSB Shares and 2,000,000 RCPS, of which 5,263,158 PSSB Shares and 2,000,000 RCPS have been issued and fully paid-up. The 2,000,000 RCPS have been converted into 325,307 new PSSB Shares on 18 May 2011 to facilitate the Acquisition. As a result, the issued and fully paid-up share capital of PSSB as at the date of this Prospectus is RM5,588,465 comprising 5,588,465 PSSB Shares. [The Rest Of This Page Is Intentionally Left Blank]

4. INFORMATION ON OUR GROUP (Cont’d) The changes to the issued and fully paid-up share capital of PSSB during the last three (3) years up to the LPD were as follows:­Date Of Allotment 30 December 2008  No. Of Ordinary Shares Allotted 263,158  Par Value (RM) 1.00  Consideration Cash  Cumulative· Issued And Fully Paid-Up Share Capital (RM) 5,263,158(aj
Date Of Allotment  No. Of RCPS Allotted  Par Value (RM)  Consideration  Cumulative Issued And Fully Paid-Up Share Capital (RM)  13 July 2009  2,OOO,OOO(a)  0.10  Cash  200,000
Note:­(a) The 2,000,000 RepS have been converted into 325,307 new PSSB Shares on 18 May 2011 to facilitate the Acquisition. As a result, the issued and fully paid-up share capital of PSSB as at the date of this Prospectus is RM5,588,465 comprising 5,588,465 PSSB Shares. None of PSSB Shares were issued at a discount, on special terms or instalment payment terms. PSSB does not have any warrant or option in issue or any uncalled capital. (c) Subsidiary Or Associa~ed Company As at the LPD, PSSB has two (2) wholly owned subsidiaries, namely LSB and PR&D. PSSB does not have any associated company. PSSB acquired 80% equity interest in LSB on 3 January 2005 and the remaining 20% equity interest on 14 October 2008. PSSB acquired 100% equity interest in PR&D on 3 January 2005. [The Rest Of This Page Is Intentionally Left Blank] 4. INFORMATION ON OUR GROUP (Cont’d) 4. INFORMATION ON OUR GROUP (Cont’d) (ii)  LSB  (a)  Background And Principal Activities And Products/Services  LSB was incorporated in Malaysia under the Act as a private limited company on 9  April 2001, under the name of Prestariang Technology Sdn Bhd and commenced  operations in 2003. The company changed to its present name of Logisys Sdn Bhd  on 14 October 2008.  LSB is principally involved in the provision of ICT training, and software licence  distribution and management.  (b)  Share Capital  As at the LPD, the authorised share capital of LSB is RM1,OOO,000 comprising  1,000,000 ordinary shares of RM1.00 each, of which 500,000 ordinary shares of  RM1.00 each have been issued and fully paid-up. There have been no changes in  LSB’s issued and paid-up capital for the last three (3) years up to the LPD.  LSB does not have any warrant, option or convertible securities in issue or any  uncalled capital.  (c)  Subsidiary Or Associated Company  As at the LPD, LSB does not have any subsidiary or associated company_  (iii)  PR&D  (a)  Background And Principal Activities And Products/Services  PR&D was incorporated in Malaysia under the Act as a private limited company on 17  May 2004, under the name of Prestariang Services Sdn Bhd. The company changed  its name to Prestariang Digital Sdn Bhd on 25 September 2004. It commenced  operations in 2005 before ceasing its activities in 2006. The company subsequently  changed to its present name of Prestariang R&D Sdn Bhd on 26 November 2010.  PR&D has commenced R&D activities in end 2010.  (b)  Share Capital  As at the LPD, the authorised share capital of PR&D is RM100,OOO comprising  100,000 ordinary shares of RM1.00 each, of which all the 100,000 ordinary shares of  RM1.00 each have been issued and fully paid-up. There were no changes in PR&D’s  issued and paid-up share capital for the last three (3) years up to the LPD.  PR&D does not have any warrant, option or convertible securities in issue or any  uncalled capital.  (c)  Subsidiary Or Associated Company  As at the LPD, PR&D does not have any subsidiary or associated company.

4.1.4 Key Achievements, Milestones And Awards Our Group’s key development and achievement milestones over the years are as set out below:­Year Event 2004 • Undertook the BPPT Programme awarded by the MOE
• PSSB was granted MSC Status and Pioneer Status by the Government of Malaysia as represented by the MOF and the MITI
• PSSB was awarded a contract by the MOHE for the pilot 3P Programme specifically for Universiti Teknologi MARA
• PSSB expanded its business activities to include software licence distribution and management and secured two (2) contracts from the MOHE for the supply of Microsoft and Autodesk software licences under the MUSE programme
• Completed the BPPT Programme
• Secured a contract from the MOH for the ICMS Programme which was conducted

2005 2006 2007 2008 at three (3) Government healthcare training institutions • Secured a three (3)-year contract from the Ministry of Rural and Regional Development, Malaysia, to distribute and manage Microsoft software licence acquisitions for entities with more than 100 computers, under the purview of this Ministry
• Appointed by Microsoft (Malaysia) Sdn Bhd to provide ICT literacy training to civil servants and system integrators in Malaysia under the RBTCS Programme and vendor development programme respectively, coordinated by the MOF
• Launched a new “FlyingStart” pilot programme with our content partner, National Council for Graduate Entrepreneurship from the United Kingdom, aimed at providing intensive business start-up training to final year students in local public universities
• The contract for the supply of Microsoft software licences to public higher education institutions in Malaysia was renewed for another two (2) years. Furthermore, upon the expiration of the Autodesk contract, we have been awarded a, new three (3)-year contract for the supply of Autodesk software licences under the MUSE Programme

2009 2010 • PSSB obtained a letter from the MITI for approval of extension of the Pioneer Status. The extension started from 30 June 2010 and is valid for another five (5) years
• Launched our first in-house developed ICT certification programme, namely “IC CITIZEN” for the global market. Signed a partnership agreement with Certiport from the US, to market our “IC CITIZEN” programme through its network of approximately 10,000 centres in 142 countries
• Secured a three (3)-year contract to supply and manage Microsoft software licences for 8,000 computers and provision of ICT training to the IRB
• Secured a 20-month contract from the MOE to supply and manage Microsoft software licences for public schools and matriculation colleges under the EM Programme. The contract is to supply and manage Microsoft software licences for 300,000 computers

4. INFORMATION ON OUR GROUP (Cont’d) Year  Event  • LSB obtained letters of agreement from Microsoft (Malaysia) Sdn Bhd whereby it was appointed as:­-a provider of ICT training for teachers and student development activities under the Partnership for Technology Access Initiative by the MOHE; and -a provider of ICT training to students under the Malaysian Broadband PC Initiative sponsored by the Ministry of Information Communications and Culture, Malaysia • PR&D commenced R&D activities • Secured a three (3) -year contract from the MOE to supply and manage Microsoft software licences for the District Academic Department, Institutes of Teacher Education and other MOE agencies (excluding matriculation colleges and schools) • Obtained a new letter of award from the MOHE to provide the 3P Programme to universities, polytechnics and community colleges as directed by the MOHE for a period of four (4) years • Awarded by the MOHE a new contract for the supply of Microsoft software licences under the MUSE Programme for a period of four (4) years effective from the expiration of the previous contract of two (2) years in 2011 • Obtained a letter of award from the Authority for Info-communications Technology Industry of Brunei Darussalam to provide the “IC CITIZEN Training & Certification” and “IC CITIZEN Train the Trainer” programmes to 50 participants for each of the programmes  2011
As a testimony to the quality of our products, technological capabilities, creditworthiness and management capabilities, we have received many awards and recognitions in the course of our operations, as listed below:­Year  Typ es of Awards and Recognitions  2004  • • • • • • • • • • • • •  Apple Key Account Win FY 2004 Microsoft Certified Partner for Learning Solutions (“CPLS”) 2007-2008 Microsoft CPLS 2008-2009 Asia Pacific Regional Best Practices in Advancing Industry Growth through Innovation in Education 2008 Award by CompTIA Certificate of Acknowledgement for PSSB, IBM Malaysia Sdn Bhd and Universiti Teknology MARA for working together under the Career Education in IBM Software (“CEIS”) 2008 Microsoft Gold Certified Partner 2008-2009 Microsoft CPLS Partner Excellence Award Microsoft Gold Certified Partner 2009-2010 Most Valued Partner by Prometric ATC of the Year Award 2009 under the Asia Pacific Region by the EC-Council in US Most Comprehensive Global IT Certification Programme in Asia by Prometric Member in good standing and afforded all the privileges and benefits of this designation 2009-2010 by CompTIA Member in Good Standing of CompTIA 2009 by CompTIA  2007  2008  2009
4. INFORMATION ON OUR GROUP (Cont’dj Year  Types of Awards and Recognitions  • Highest Certification Achievement and Commitment in Producing Globally­benchmarked Graduates by CompTIA • Best Performance for CEIS Programme by IBM Malaysia Sdn Bhd • Microsoft Learning Solutions Partner of the Year 2010 • Microsoft Gold Certified Partner 2010-2011 • Microsoft Certified Partner 2010-2011 • Recognition Award for Innovative Venture Capital Backed Companies 2010 by the Malaysian Venture Capital and Private Equity Association • CompTIA Authorised Platinum Partner 2010 • EC-Council Circle of Excellence Authorised Training Centre 2010 • Autodesk High Achiever Education Authorization 2011 • Microsoft Partner Network Gold Volume Licensing 2011 • Autodesk Best Performing Partner in Asia Pacific 2011  2010  2011
4.2 LISTING SCHEME In conjunction with, and as an integral part of the listing of and quotation for our Company’s entire issued and fUlly paid-up share capital on the Main Market of Bursa Securities, we have undertaken the Listing Scheme which involves the following:­(i) Dividend Payment Prior to the Acquisition, PSSB had, on 13 May 2011, paid to its shareholders a dividend of RM8.00 million. (ii) Acquisition Pursuant to the PSSB SPA, our Company acquired the entire equity interest of PSSB for a purchase consideration of RM1 9,799,998, which was fully satisfied by the issuance of 197,999,980 new Shares. The purchase consideration of RM1 9,799,998 was arrived at on a willing buyer-willing seller basis after taking into consideration the following:­Audited consolidated net assets of PSSB and its subsidiaries (“PSSB Group”) Additional share capital and share premium arising from the conversion of RCPS(a) Less: Dividend Payment
Adjusted consolidated net assets of the PSSB Group Discount of purchase consideration from the adjusted consolidated net assets of the PSSB Group (%) As at 31  As at 30  December 2009  September 2010  (RM)  (RM)  17,896,140  26,945,046  2,000,000  2,000,000  – (8,000,000)
19,896,140  20,945,046
0.48  5.47
Note:­(a) After taking into consideration the conversion of 2,000,000 RCPS held by KMP into 325,307 new PSSB Shares. 4. INFORMATION ON OUR GROUP (Cont’d) The vendors and their respective equity interests in PSSB acquired by our Company together with the number of new Shares issued to them and their nominees as consideration are as set out:­Name  Shareholding In PSSB  No. Of New Shares Issued As Consideration No. Of PSSB Shares Held  “10 Held  Dr Abu EkoHati(a} Sigma Dedikasi(b) Anjakan Evolusi(c} Loet Holding Inc (“Loet”)’d) KMP  5,000,000 —-588,465  89.47 —-10.53  77,000.000 50,000,880 31,409,800 9,240,000 9,500,000 20,849,300  Total  5,588,465  100.00  197,999,980
Notes:­(a) Pursuant to the Acquisition, Dr Abu renounced his rights to the allotment of 50,000,880 new Shares to EkoHati. Please refer to Section 5. 1.2(ii) of this Prospectus for details on EkoHati.
(b) Pursuant to the Acquisition, Dr Abu renounced his rights to the allotment of 31,409,800 new Shares to Sigma Dedikasi (“Renouncement to Sigma Dedikasi} Please refer to Section 5.1.2(iii) of this Prospectus for details on Sigma Dedikasi.

Upon completion of the Renouncement to Sigma Dedikasi, Dr Abu sold and transferred 21.00% equity interest in Sigma Dedikasi to Datuk Ahmad Fikri for a sale consideration of RM5,936,452 (“Sale and Transfer to Datuk Ahmad Fikri’J. The sale consideration was arrived at on a willing buyer -willing seller basis after taking into consideration the 31,409,800 Shares held by Sigma Dedikasi pursuant to the Renouncement to Sigma Dedikasi and the IPO Price. The Sale and Transfer to Datuk Ahmad Fikri was completed on 2 June 2011. Datuk Ahmad Fikri is a strategic investor to our Group by virtue of his current involvement in the ICT industry, particularly in the area of system integrator, supply and implementation of hardware and software solutions and provision of maintenance services. With his current experience and network in the ICT industry, our Directors believe that Datuk Ahmad Fikri may bring business opportunities to our Group. Please refer to Section 5.1.3(ii) of this Prospectus for details on Datuk Ahmad Fikri. Also, in conjunction with the Sale and Transfer to Datuk Ahmad Fikri, Dr Abu acquired from his spouse, Shahirul Azian, her 1.00% equity interest in Sigma Dedikasi, on 2 June 2011. (c) Pursuant to the Acquisition, Dr Abu renounced his rights to the allotment of 9,240,000 new Shares to Anjakan Evolusi. Please refer to Section 5.1.2(iv) of this Prospectus for details on Anjakan Evolusi. .
(d) In conjunction with the Acquisition, Dr Abu sold and transferred 9,500,000 new Shares issued to him as consideration shares for the Acquisition, to Loet for a sale consideration of RM8,550,00a. The sale consideration was arrived at on a willing buyer -willing seller basis based on the IPO Price. The 9,500,000 new Shares were issued and allotted by our Company directly to Loet on 2 June 2011.

Loet was incorporated in the British Virgin Islands on 1 December 2010 under the BVI Business Companies Act, 2004 as a BVI business company. As at the LPD, ­• Loet is wholly owned by Blue Sky Global Ltd (with one (1) share held), which was incorporated in the Republic of Seychelles on 6 January 2010 under the International Business Companies Act, 1994, as an international business company. By virtue of a trust arrangement, Yeow Kheng Chew (“YKC”) is the beneficial owner of the share in Loet held by Blue Sky Global Ltd; and
• the director of Loet is Prosper Management Ltd, which was incorporated in Belize City, Belize, on 3 July 2009 under the International Business Companies Act, Chapter 270 of the Laws of Belize, Revised Edition 2000, as an international business company.

4. INFORMATION ON OUR GROUP (Cont’d) The sale and transfer of the Shares to Loet will enable YKC to play the role of our strategic investor through Loet. YKC is currently an Executive Director of a public listed company, Kencana Petroleum Berhad. With his experience in running a public listed company, our . Directors believe that YKC’s participation as our strategic investor will lend credential to our Group. All the new Shares issued pursuant to the Acquisition rank pari passu in all respects with one another and with the existing Shares and carryall rights to receive in full all dividends and other distributions declared and paid subsequent to the allotment thereof. The Acquisition was completed on 2 June 2011. (iii) IPO (a) Public Issue
We are undertaking the Public Issue, details of which are set out in Section 2.2.1 of this Prospectus.
(b) Offer For Sale

We are undertaking the Offer for Sale, details of which are set out in Section 2.2.2 of this Prospectus. (iv) Listing We have also applied to Bursa Securities for the Admission and Listing. As further set out in Section 6.1 of this Prospectus, the approval from Bursa Securities has been obtained via its letter dated 30 May 2011. [The Rest Of This Page Is Intentionally Left Blank] 4. INFORMATION ON OUR GROUP (Cont’d) 4.3  OVERVIEW OF OUR GROUP’S BUSINESS ACTIVITIES  4.3.1  Business Model  Our business model is as depicted in the diagram below:-
CoreBusiness ~ and Revenue Streams
UniqueBusiness )Positioning and Target Markets ICTTrainingand Certification
Government Bodies
Software Licen ce Distribution and Management
Other Groups
Medium toHigh Value GovernmentLong.TermContracts ContractsContracts Advan lages an d Key Stren gth s
Competitive In-house Developed Economies Potential GlobalTraining& Certificationof Scale Market PlaceProgramme
(i) Core Business And Revenue Streams We are an ICT service provider focusing on ICT training and certification, and software licence distribution and management. Our two (2) core business activities are highly synergistic, where we commonly provide ICT training and certification together with the supply of licences for the software that we are training and certifying. As a certified partner for various technology and software vendors and organisations, we have the capability to provide both basic and professional ICT training and certification encompassing instructor-led courses and certification examination at the end of the course. At the same time we are able to distribute and manage their software licences. Currently, we offer approximately 40 certification courses from various technology and software vendors and organisations who are our valued partners including Microsoft, IBM, Oracle, CompTIA, Autodesk, EC-Council, Adobe and others. 4. INFORMATION ON OUR GROUP (Cont’d) We are authorised to provide ICT training and certification in any location in Malaysia. This enables us to have the flexibility to expand our business operations and services within Malaysia. Under the 3P Programme, we provide professional ICT training and certification for public higher education institutions in Malaysia. As at the LPD, approximately 18,790 participants have participated in the 3P Programme. Under the RBTCS Programme, we provide ICT literacy training to civil servants in Malaysia. As at the LPD, we have provided ICT literacy training to approximately 1,660 civil servants in Malaysia. The other part of our business is in software licence distribution and management, which is synergistic to our ICT training and certification business whereby we can provide a total package to our customers. For example, in 2006, we secured two (2) contracts from the MOHE for the MUSE Programme in parallel with the 3P Programme for the supply of Microsoft and Autodesk software licences to public higher education institutions in Malaysia, namely a three (3) plus two (2)-year contract and a three (3)-year contract respectively. The contract for the supply of Microsoft software licences has been renewed for a further period of two (2) years upon its expiration of three (3) years in 2009 and thereafter in 2011, we have been awarded by the MOHE a new contract for the supply of Microsoft software licences for a period of four (4) years effective from the expiration of the previous contract of two (2) years. Furthermore, upon the expiration of the Autodesk contract, we have been awarded a new contract from the MOHE for the supply of Autodesk software licences under the MUSE Programme for a period of three (3) years commencing from 2009. (ii) Unique Business Positioning And Target Markets Our business positioning is focused on high value contracts where each contract services a large group of individual users or organisations. As an example, we were appointed by Microsoft (Malaysia) Sdn Bhd to provide ICT literacy training to civil servants in Malaysia under the RBTCS Programme coordinated by the MOF. Our strategy of focusing on high value contracts enables us to grow our business while optimising our sales and marketing resources for maximum gains. Thus, we target customers that will enable us to deliver our services to a large user group of individuals or organisations. In contrast, many ICT training and certification as well as software licence distribution and management companies market and sell to individuals or smaller groups of users or organisations. Such a business strategy would require significant sales and marketing resources to cover a wider market. . Our target markets are primarily those that form a large and natural “defined user group”. They include Government bodies and public tertiary education institutions. Each of these groups would form a large user base. As at the LPD, we have provided ICT training and certification to the following groups:­• civil servants from Government agencies; and
• students, tutors, lecturers and staff from public tertiary education institutions.

4. INFORMATION ON OUR GROUP (Cont’d) (iii) Competitive Advantages And Key Strengths Our competitive advantages and key strengths provide us with a strong platform to compete against other business operators, and also to facilitate business sustenance and growth. Our competitive advantages and key strengths are as follows:­(a) Track Record And Established Reputation Since 2004, we have developed a reputation as an established provider of ICT training and certification in Malaysia. Our track record is reinforced by the following achievements:­• Between 2004 and 2007, we have provided ICT literacy training to approximately 100,000 teachers from local public schools under the BPPT Programme.
• As at the LPD, approximately 18,790 participants have participated in our training and certification programme since 2006 under the 3P Programme.
• As at the LPD, we have provided ICT literacy training to approximately 1,660 civil servants since 2009 under the RBTCS Programme.
• As at the LPD, we managed and distributed approximately 878,621 Microsoft licences and 15,410 Autodesk licences to various Government bodies in Malaysia since 2006.

In addition, we have obtained numerous awards and recognitions from technology and software vendors and organisations, which serve as a testament of our success and market reputation. Please refer to Section 4.1.4 of this Prospectus for our list of awards and recognitions. (b) High Value Contracts Our business strategy is focused on high value contracts where each contract enables us to service a large group of individuals or organisations. This provides us with a key competitive advantage and business differentiation that enables us to grow our business substantially while optimising our sales and marketing effort. Our strategy is in contrast to most other operators that have to sell and market to single or smaller groups of people or organisations. Such a strategy requires significant sales and marketing efforts, and places considerable constraints on the ability to obtain rapid business growth. In addition, our success in utilising this strategy of high value contracts will provide us with the platform to replicate this model when we expand our business into other industries and geographical areas, both locally and overseas.
4. INFORMATION ON OUR GROUP (Cont’d) (c) Medium to Long Term Contracts One of our key strengths is that we have medium to long-term contracts in the provision of ICT training and certification as well as software licence distribution and management. As at the LPD, we have the following contracts with our customers:­ICT Training And Certification • In 2006, PSSB, was awarded a contract by the MOHE for the pilot 3P Programme specifically to provide professional ICT training and certification for Universiti Teknologi MARA. Since 2007, PSSB has continued to obtain contracts which are renewable yearly from the MOHE for the 3P Programme until 2010.
• In general, the contract renewal for the 3P Programme is carried out by way of the MOHE issuing a letter of award to the PSSB each year. Upon the issuance of the letter of award by the MOHE, PSSB and the MOHE will enter into a new agreement to effect the renewal. In 2011, PSSB has been awarded a new letter of award from the MOHE to provide the 3P Programme to universities, polytechnics and community colleges as directed by the MOHE for a period of four (4) years.
• In 2009, PSSB was appointed by Microsoft (Malaysia) Sdn Bhd to provide ICT literacy training to civil servants and system integrators in Malaysia under the RBTCS Programme and vendor development programme respectively coordinated by the MOF. This was for a period of three (3) years with the option to extend for an additional three (3) years.
• In 2010, LSB obtained letters of agreement from Microsoft (Malaysia) Sdn Bhd whereby it was appointed as:­

a provider of ICT training for teachers and student development activities under the Partnership for Technology Access Initiative by the MOHE; and a provider of ICT training to students under the Malaysian Broadband PC Initiative sponsored by the Ministry of Information Communications and Culture, Malaysia. • In 2011, PSSB has obtained a letter of award from the Authority for Info­communications Technology Industry of Brunei Darussalam to provide the “IC CITIZEN Training & Certification” and “IC CITIZEN Train the Trainer” programmes to 50 participants for each of the programmes. [The Rest Of This Page Is Intentionally Left Blank]
4. INFORMATION ON OUR GROUP (Cont’d) Software Licence Distribution and Management • In 2006, we secured two (2) contracts from the MOHE for the MUSE Programme in parallel with the 3P Programme for the supply of Microsoft and Autodesk software licences to public higher education institutions in Malaysia, namely a three (3) plus two (2)-year contract and a three (3)-year contract respectively. The contract for the supply of Microsoft software licences has been renewed for a further period of two (2) years up to 2011 upon its expiration of three (3) years in 2009 and thereafter in 2011, PSSB has been awarded by MOHE a new contract for the supply of Microsoft software licences for a period of four (4) years effective from the expiration of the previous contract of two (2) years in 2011. Furthermore, upon the expiration of the Autodesk contract, we have been awarded a new contract from the MOHE for the supply of Autodesk software licences under the MUSE Programme for a period of three (3) years commencing from 2009.
• In 2008, PSSB secured a three (3)-year contract from the Ministry of Rural and Regional Development, Malaysia to supply and manage Microsoft software licence to entities with more than 100 computers, under the purview of this Ministry.
• In 2010, PSSB secured, among others, the following new contracts:­

a three (3)-year contract from the IRB to supply and manage Microsoft software licences for 8,000 computers and to provide ICT training; and a 20-month contract from the MOE to supply and manage Microsoft software licences for approximately 10,000 public schools and matriculation colleges in Malaysia under the EAA Programme which covers 300,000 computers. • In 2011, PSSB secured a three (3)-year contract from the MOE to supply and manage Microsoft software licences for the District Academic Department, Institutes of Teacher Education and other MOE agencies (excluding matriculation colleges and schools). These contracts help us to secure a continuous revenue stream and provide some assurance of business continuity for the duration of the contracts. (d) Government Contracts A significant proportion of our contracts are from the Government of Malaysia. The percentage of revenue derived from government contracts is detailed in Section 4.3.10 of this Prospectus. This provides us with some keyadvantages:­• These contracts serve a large group of users or organisations in the forms of Government departments or ministries, hence the aggregate value of each contract is relatively higher to contracts with the private sector.
• These Government contracts provide our business with some assurance of a continuous revenue stream and less risk of non-payment during the duration of the contracts.

This is a competitive advantage as most other service providers of ICT training and certification, as well as distribution and management of software licences are focused on the private sector where contract sizes are relatively lower in terms of value or for shorter duration.

4. INFORMATION ON OUR GROUP (Cont’d) (e) Economies Of Scale Our Group enjoys economies of scale through the large number of individuals that we train, and the large number of software licences that we distribute and manage. • Between 2004 and 2007, we have provided ICT literacy training to approximately 100,000 teachers from local public schools under the BPPT Programme.
• As at the LPD, approximately 18,790 participants have participated in our training and certification programme since 2006 under the 3P Programme.
• As at the LPD, we have provided ICT literacy training to approximately 1,660 civil servants since 2009 under the RBTCS Programme.
• As at the LPD, we managed and distributed approximately 878,621 Microsoft licences and 15,410 Autodesk licences to various Government bodies in Malaysia since 2006.

In contrast, most other operators would not have such a sizeable and regular flow of end-customers to service. Our economies of scale obtained through high throughput for our services enable us to reduce our per-unit cost of servicing end-customers. This is particularly pertinent in terms of:­(1} maximising utilisation of personnel for the following functions:­• training and certification;
• software licence distribution and management;
• administration; and • other head office functions;

 

(2} maximising utilisation of training and certification facilities at designated centres in 14 public universities, selected polytechnics and community colleges and six (6) INTAN training centres located in Malaysia; and (3) Our large volume of work also provides us with stronger bargaining power to obtain better commercial terms from our partners like Microsoft, Autodesk, Adobe, Oracle and Prometric as well as external trainers. Economies of scale represent a strong competitive advantage for us in improving our profit margin. (f) In-House Developed Training And Certification Programme To leverage on our core competencies in the provision of ICT training and certification, we have successfully developed a training and certification programme, namely “IC CITIZEN” for the local and global market. This training and certification programme is designed to promote the appropriate use of technology particularly for today’s digital literacy requirements. The programme aims to impart basic understanding and rules of acceptable behaviour when using the Internet. It also encourages individuals to be responsible in online communities. Our proprietary training and certification programme provides us with the advantage of being able to develop new training modules and certification to meet market needs. We also have the ability to undertake modifications, customisation and updates expediently and cost effectively as and when they are necessary. 4. INFORMATION ON OUR GROUP (Cont’d) Our in-house development training and certification programme enables us to expand our business into any country without restrictions on IP rights. In addition, having our in-house development training and certification programme will enable us to derive the following benefits:­• we are able to resell our proprietary programme without constraints;
• we are able to appoint resellers to expand our global coverage;
• we are able to customise our programme to better fit customers’ requirements;
• we are able to enhance our programme to keep abreast of changing needs of customers and environment, as well as technologies; and
• we are not reliant on third party principals.

(9) Potential Global Market Place As we own the IP of our “IC CITIZEN” training and certification programme, which was made available globally in November 2010, we are able to export the programme to most places in the world with minor modifications. Our ability to export our programme enlarges our potential market significantly other than Malaysia. In 2010, we signed a partnership agreement with our global partner, Certiport, from the US to market our “IC CITIZEN” training and certification programme. Certiport has a network of approximately 10,000 centres in 142 countries. Access to the global market place for our own training and certification programme provides us with significant opportunities for business growth. 4.3.2 Our Products, Services And Operations (i) Overview Our business activities are as follows:­
ICT Training and Certification

Software Licence Distribution and Management
We .are an ICT service provider focusing on ICT training and certification, and software licence distribution and management. Our two (2) core business activities are highly synergistic, where we commonly provide ICT training and certification together with the supply of licences for the software that we are training and certifying. For example, the synergistic effect is evidenced in the 3P and MUSE Programmes where we supply the Microsoft and Autodesk software licences to public higher education institutions in Malaysia under the MUSE Programme in parallel with the 3P Programme in conducting leT training and certification. In addition, under the contract awarded by the IRB, we also supply Microsoft software licences as well as provide ICT training.

 

4. INFORMATION ON OUR GROUP (Cont’d) (ii) Breakdown Revenue By Business Segment The breakdown of our Group’s revenue by business segment for FYE 2009 and FYE 2010 is as follows:­
For FYE 2009 and FYE 2010, revenue derived from the provision of ICT training and certification accounted for 51.52% and 39.41 % of our Group’s total revenue respectively. Revenue derived from the provision of professional ICT training and certification accounted for 50.73% and 36.65% of our Group’s total revenue for FYE 2009 and FYE 2010 respectively, while the provision of basic ICT training accounted for 0.79% and 2.76% of our Group’s total revenue for FYE 2009 and FYE 2010 respectively. The provision of basic ICT training, under the RBTCS Programme, only started in the fourth quarter of 2009. Our software licence distribution and management business accounted for 48.48% and 60.59% of our Group’s total revenue for FYE 2009 and FYE 2010 respectively. This was mainly to service public higher education institutions in Malaysia under the MUSE Programme and public schools and matriculation colleges under the EAA Programme, and for the supply of Microsoft software licences to the IRB. (iii) ICT Training And Certification Our ICT training and certification business is in two (2) areas:­• Professional ICT training and certification; and
• Basic ICT training and certification.

(a) Professional ICT Training And Certification Professional ICT training and certification generally refers to industry based technical training and certification that are internationally recognised. This includes the provision of instructor-led short courses in ICT vendors’ products and technologies. A certification examination is then held at the end of each training course. Our professionallCT training and certification is aimed at providing specific and practical ICT skills for individuals entering the ICT industry, updating their skills and knowledge, expanding their skill sets, as well as preparing for career advancement. We provide professional ICT training and certification focusing on internationally recognised industry driven certifications to address the gap between competency levels of graduates to improve employability.

 

 

4. INFORMATION ON OUR GROUP (Coni’d) Professional ICT certification is important as they serve as credentials of the individual’s skill and knowledge base. Certification also provides a uniform and independent means of accessing a person’s skill and knowledge base. This is because vendors like Microsoft or Oracle provide the training modules and the examination papers relating to the certification process. As such, all training materials and certification examinations are uniform across the world. Our professional ICT training and certification are for specific and short courses, where each course takes approximately one (1) to six (6) weeks to complete. As such, professional ICT training and certification enables individuals to acquire specific knowledge and skill set on demand, as and when they need them. This also implies that individuals can adopt a lifelong learning paradigm to continually acquire knowledge, skills and new capabilities. We commenced the provision of professional ICT training and certification in 2006 under the 3P Programme. We undertake the following activities in our provision of professional ICT training and certification:­• Classroom based training, refers to trainer or instructor-led training where our trainers bring to the classroom a broad range of hands-on experience and expertise to transfer their skills and knowledge to the participants. All our courses are fully interactive and we provide step-by-step instructions on implementation of various technology solutions with all the necessary facilities and software applications. All the course materials and workbooks for the professional ICT courses are sourced directly from the respective technology or software vendors. • Hands on practical training, where the training solutions are built on practical real-world situations, which allow participants to perform each step individually in gaining valuable hands-on experience.
• Preparation of examination, where we prepare all our participants for certification examinations.

We provide a wide range of professional ICT training and certification encompassing approximately 40 types of courses from various internationally recognised technology and software vendors and organisations, of which the list is as follows:­
Technology and Types of Training and Certification Software Vendorsl Organisations
Microsoft Certified Technology Specialist -SOL Server 2008
(Database Development) (MCTS-SOL 2008) Microsoft Certified Technology Specialist -Windows 7, Configuration (MCTS-WIN7)
Microsoft Certified Technology Specialist -Windows 7 Enterprise
Desktop Support Technician (MCTS-ES) Microsoft Certified IT Professional-System Administrator (MCITP­SA)
4. INFORMATION ON OUR GROUP (Cont’d) 4. INFORMATION ON OUR GROUP (Cont’d) Technology and Software Vendorsl Organisations  Types of Training and Certification  Microsoft Certified Professional Developer -ASP .NET Developer 3.5 (MCPD-ASP.NET) Microsoft Certified Technology Specialist -.NET Framework 3.5 Windows Form Applications (MCTS-.NET) Microsoft Certified Technology Specialist -.NET Framework 3.5 ASP.NET Applications (MCTS-ASP.NET) Microsoft Certified Technology Specialist -Microsoft Office SharePoint Server 2007, Configuration (MCTS-SP) Microsoft Certified Technology Specialist -Microsoft Office Project 2007, Managing Project (MCTS-Project)  Autodesk  Autodesk AutoCAD 2010 Associate (AutoCAD) Autodesk Inventor 201 0 Certified Associate (Inventor) Autodesk Revit Architecture 2010 Certified Associate (Revit)  CISCO  Cisco Certified Entry-Level Network Technician (CCENT) Cisco Certified Network Associate (CCNA)  CompTIA  CompTIA A+ Certification (CompTIA A+) CompTIA Network+ Certification (Network+) CompTIA Security+ Certification (Security+) CompTIA Project+ Certification (Project+)  Adobe  Adobe Dreamweaver CS4 (Dreamweaver) Adobe Flash CS4 (FLASH) Adobe Photoshop CS4 Professional (Photoshop)  EC-Council  EC-Council Network Support Administrator (ENSA) EC-Council Project Management (“EPM”) EC-Council Certified Security Specialist (ECSS)  Oracle  Oracle Database 11 g Administrator Certified Associate (OCA) Oracle Database -SQL Certified Expert (OSQL) Sun Certified Java Programmer (SCJP) Sun Certified Java Associate (SCJA)  IBM  IBM Certification: E-Business System Administration (IBM:E-BIZ) IBM Certification: Database Administration (IBM:DBA) IBM Certification: Software Testing Information (IBM:TEST) IBM Certification: Java EE Messaging (IBM:Java) IBM Certification: Web Services (IBMWeb Services) IBM Certification: Web 2.0 (IBMWeb 2.0)  Linux Professional Institute (LPI)  Linux Professional Institute Certification (LPIC)  Xilinx(aJ  Xilinx -IC Design Programme (Xilinx-ICDP)  SAPAG  SAP ERP Fundamental Certification (SAP)  Service Desk Institute  Service Desk Institute (SDI)  Information Technology Infrastructure Library (“ITIL”)  IT Infrastructure Library Foundation (ITIL)
Types of Training and Certification Software Vendorsl Organisations Technology and
Note:­(a) This is undertaken by Symmid Corporation Sdn Bhd (“Symmid’), a Xilinx Authorised Training Provider in Malaysia. As at the LPD, Symmid is wholly owned by KMP. As a provider of professional ICT training and certification, we are certified by the folloWing technology and software vendors and organisations:­• Microsoft Gold Certified Partner under the Certified Partner for Learning Solutions in Malaysia since 2008. We carry out skill assessment, technical training on Microsoft products and preparation for Microsoft certification;
• Adobe Authorised Training Centre in Malaysia since 2008. We provide training and certification on Adobe products;
• Autodesk Training Center in Malaysia since 2010. We provide training and certification on Autodesk products;
• CompTIA Learning Alliance Partner since 2008. We provide training and certification on CompTIA products;
• Partner of IBM for its Career Education in IBM Software since 2008. We provide training and hands-on experience on IBM software products, and prepare them for testing including software and application testing, and basic functional testing;
• EC-Council Accredited Training Centre since 2007. We provide training and certification on e-Business technologies and ICT security;

• Oracle Certified Training Partner since 2009. We provide a range of Oracle training and certification courses (Note: Prestariang was under ‘Sun Academic Initiative’ from 2007 to 2009 and provides a range of Sun Microsystems training and certification courses. Oracle announced its acquisition of Sun Microsystems on 27 January 2010, and therefore Prestariang has signf?d up under ‘ORACLE Certified Partner-Silver Level’ since then); • Certiport Authorised Training Centre. We provide Certiport training programmes and certification, as well as prepare participants for examinations; and 4. INFORMATION ON OUR GROUP (Cont’d) • Quint Wellington Redwood Asia Sdn Bhd (“Quint”) is a global authorised training organisation for ITIL Training and Certification under AMP Group Limited UK, the owner of ITIL. We are an affiliate of Quint and are authorised by Quint to provide training and certification for the entire ITIL suite of approved courses. In addition, we are an authorised provider of testing and assessment centre to conduct examinations for professional certification. We are authorised by Prometric Premier Test Center and Pearson Vue Authorised Test Centre. Examinations are carried out by our Group at various designated test centres scattered around Malaysia. Individual participants are provided with their own workstation to ensure some degree of privacy when taking the examinations. Participants will also be under the watchful eye of an examination supervisor in each test centre during the duration of the examination. All the professional ICT certifications are awarded directly by the technology and software vendors and organisations for participants who pass their examinations. [The Rest Of This Page Is Intentionally Left Blank]
4. INFORMATION ON OUR GROUP (Cont’d) Under the 3P Programme, we provide professional ICT training and certification for public higher education institutions in Malaysia. This includes 14 public universities, 21 polytechnics and 16 community colleges in Malaysia and these are as follows:­Public Universities (1) Universiti Teknologi Malaysia, Johor and Univeristi Teknologi Malaysia ­International Campus, Kuala Lumpur
(2) Universiti Utara Malaysia, Kedah
(3) Universiti Teknikal Malaysia, Melaka
(4) Universiti Malaya, Kuala Lumpur
(5) Universiti Malaysia Pahang, Pahang
(6) .Universiti Sains Malaysia, Pulau Pinang
(7) Universiti Malaysia Sabah, Kota Kinabalu, Sabah and Universiti Malaysia Sabah-Labuan International Campus
(8) Universiti Malaysia Sarawak, Sarawak
(9) Universiti Islam Antarabangsa Malaysia, Selangor
(10) Universiti Kebangsaan Malaysia, Selangor
(11) Universiti Putra Malaysia, Selangor
(12) Universiti Teknologi MARA, Selangor and Universiti Teknologi MARA, Sarawak
(13) Universiti Darullman Malaysia, Terengganu
(14) Universiti Malaysia Terengganu, Terengganu

Polytechnics (1) Politeknik Johor Bahru, Johor Bahru, Johor
(2) Politeknik Mersing, Mersing, Johor
(3) Politeknik Sultan Abdul Halim Mu’adzam Shah, Kedah
(4) Politeknik Tuanku Sultanah Bahiyah, Kulim, Kedah
(5) Politeknik Kota Bharu, Kota Bharu, Kelantan
(6) Politeknik Merlimau, Merlimau, Melaka
(7) Politeknik Port Dickson, Port Dickson, Negeri Sembilan
(8) Politeknik Muadzam Shah, Muadzam Shah, Pahang
(9) Politeknik Sultan Haji Ahmad Shah, Kuantan, Pahang
(10) Politeknik Sultan Azlan Shah, Tanjong Malim, Perak
(11) Politeknik Ungku Omar, Ipoh, Perak
(12) Politeknik Tuanku Syed Sirajuddin, Arau, Perlis
(13) Politeknik Balik Pulau, Balik Pulau, Pulau Pinang
(14) Politeknik Seberang Perai, Seberang Perai, Pulau Pinang
(15) Politeknik Kota Kinabalu, Kota Kinabalu, Sabah
(16) Politeknik Kuching, Kuching, Sarawak
(17) Politeknik Mukah, Mukah, Sarawak
(18) Politeknik Sultan Idris Shah, Sabak Bernam, Selangor
(19) Politeknik Sultan Salahuddin Abdul Aziz Shah, Shah Alam, Selangor
(20) Politeknik Kota Kuala Terengganu, Kota Kuala Terengganu, Terengganu
(21) Politeknik Sultan Mizan Zainal Abidin, Dungun, Terengganu

Community Colleges (1) Kolej Komuniti Kota Tinggi (Bandar Penawar), Johor
(2) Kolej Komuniti Pasir Gudang, Johor Bahru, Johor
(3) Kolej Komuniti Segamat, Johor
(4) Kolej Komuniti Alor Gajah, Melaka
(5) Kolej Komuniti Selandar, Melaka
(6) Kolej Komuniti Bentong, Pahang
(7) Kolej Komuniti Mentakab, Pahang
(8) Kolej Komuniti Paya Besar, Pahang
(9) Kolej Komuniti Gerik, Perak

63 4. INFORMATION ON OUR GROUP (Cont’d) (10) Kolej Komuniti Bayan Baru,Pulau Pinang
(11) Kolej Komuniti Bayan Baru (Cawangan Balik Pulau), Pulau Pinang
(12) Kolej Komuniti Hulu langat, Selangor
(13) Kolej Komuniti Hulu Selangor, Selangor
(14) Kolej Komuniti Jempol, Selangor
(15) Kolej Komuniti Pasir Salak, Selangor
(16) Kolej Komuniti Kuala Terengganu, Terengganu

Our professional ICT training classes are taught by third party certified trainers under our control and supervision. These trainers are qualified and bring with them extensive industry experience to the classroom environment. Our professional ICT training classes are conducted in public higher education institutions across various states in Malaysia. In addition, we provide in-house training directly to our third party certified trainers to ensure adherence to our training procedures and quality standards. (b) Basic ICT Training And Certification Under the basic ICT training and certification, we offer two (2) types of certification, namely, third party certification and our in-house certification. Third Party Certification Programmes Some of the third party basic ICT training and certification programmes that we conduct include the following:­• Microsoft Access (in relation to database systems, forms, reports and data storage);
• Microsoft Excel (including spreadsheets, charts and pivot tables);
• Microsoft Word (word processing);
• Microsoft PowerPoint (used to create business or school presentations);
• Microsoft InfoPath (create XMl-based forms for SharePoint);
• Microsoft FrontPage (web development tools);
• Microsoft OneNote (organise your thoughts and ideas in a notebook format);
• Microsoft Outlook (the email standard as well as personal information manager);
• Microsoft Publisher (for use in publishing brochures, newsletter and others);
• Microsoft Visio (for use in creating drawings, charts, maps and others); and
• Others (such as Window Server, Project Office, and Microsoft Sal Server).

We mainly adopt instructor-led learning methodology to perform all of our basic ICT training and certification. Our basic ICT training and certification covers a broad range of courses including elementary ICT competency skills and knowledge, as well as technical subjects including, among others, the following:­• introduction and operation of computer and operating systems;

• basic word processing;
• spreadsheet;
• file management;
• Internet and email;
• information network; and

 

 

4. INFORMATION ON OUR GROUP (Cont’d) • use and integration of application packages such as word processing, spreadsheet and slide presentation. For FYE 2009 and FYE 2010, revenue derived from our provIsion of basic ICT training and certification accounted for 0.79% and 2.76% of our total revenue respectively. This was mainly from the provision of ICT literacy training to civil servants under the RBTCS Programme coordinated by the MOF, which started in the fourth quarter of 2009. Under the RBTCS Programme, we conduct ICT training and certification in INTAN training centres provided by the Public Service Department. We conduct ICT training and certification in the following INTAN training centres:­• INTAN Southern Regional Campus in Kluang, Johor;
• INTAN Wilayah Utara in Sungai Petani, Kedah;
• INTAN Sabah in Kota Kinabalu;
• INTAN Bukit Kiara in Kuala Lumpur;
• INTAN Sarawak in Kuching; and
• INTAN East Region Campus in Kemaman, Terengganu.

In-house Certification Programme We developed and introduced our first in-house training and certification programme, namely “IC CITIZEN”, which was officially launched in November 2010, for the global market. This training and certification programme is designed to promote the appropriate use of technology particularly for today’s digital literacy requirements. The programme aims to impart basic understanding and rules of acceptable behaviour for Netizens/Cybercitizens (l’Jetizens or Cybercitizens refers to individuals who utilise the Internet) and is aimed at youths, parents, civil servants and anyone who uses the internet and digital tools as part of their daily lives. It also encourages individuals to be responsible when they are on online communities. Our “IC CITIZEN” training and certification programme covers various areas including basic understanding of computing, skills for working in digital related fields including the Internet and network environment, and use of applications such as word processing, spreadsheet, report presentation and other applications. We have developed eight (8) major modules under the “IC CITIZEN” certification programme as follows:­Type of Modules e-ACCESS e-L1TERATE e-RULE e-SAFETY  Descriptions Highlights the rights to reliable information access and also the understanding of privileges in using electronic information. Demonstrates the capability level to use technology appropriately for credible information and materials. Promotes understanding and awareness of legal rights and restrictions that govern technology use, including ownership and proprietorship, as well as awareness of legal implications and consequences such as installation of illegal software, plagiarism and IP infringements. Measures and promotes best practices for Netizens to protect their personal information and adopt network security.
4. INFORMATION ON OUR GROUP (Cont’d) Type of Modules  Descriptions  e-INTERACTION & COLLABORATION e-ENTERPRISE e-CARE e-ACCOUNTABILITY  Educates Netizens in relation to appropriateness in exchanging and sharing information. Highlights appropriateness of conducting transactions through the Intemet including buying and selling of goods online, and protection of identity and information, as well as identifying the consequences of poor practices. Illustration on best practices particularly for physical and psychological well being of Intemet users such as importance of appropriate lighting and exercise, and introducing various measures to combat Internet addiction. Highlights the privileges, responsibilities, integrity, expectations and ethical behaviour, including credibility of Netizens.
In 2010, we appointed Certiport to market our “IC CITIZEN” training and certification programme on a global basis. Certiport has a network of approximately 10,000 centres in 142 countries globally. Certiport was established in 1997 in US and the company is involved in provision of career-oriented certification to academic institutions and IT professionals. Types of services provided by Certiport include test development, psychometrics, program management, sales and marketing for the official Microsoft Office certification programmes, the Adobe Certified Associate certification programme, the iCritical Thinking Certification powered by Educational Testing Services, the CompTIA Strata IT Fundamentals and the Certiport Internet and Computing Core Certification (IC3). Our “IC CITIZEN” certification is available in any of the Certiport Authorised Test Centres. (iv) Software Licence Distribution And Management We also provide software licence distribution and management as our core business. In most situations, we undertake this activity concurrently with our other business activity of providing ICT training and certification. The type of software licences that we distribute and managed are primarily proprietary software licences, which we distribute through a volume licensing method. Proprietary software (sometimes referred to as retail software or shrink-wrapped software, especially when they are sold through retail outlets), are mainly sold to end­consumers based on restricted licensed to use agreement. Commonly, such software does not require professionals to configure and install them. Many of this type of software are used by consumers as well as business users on their personal computers and other devices on a stand-alone basis. Some of this type of software include Microsoft Windows and AutoCAD. Although most proprietary software can be installed by the users and used on a stand alone basis, there are situations, particularly in a commercial environment or within large organisations where professionals are required to install and configure the software in a network environment to set various parameters in terms of granting access, priorities and allocating user status, etc. Proprietary software covers various types of software, including applications, systems, communications, and systems and development tools and utilities. 66
4. INFORMATION ON OUR GROUP (Cont’d) Our business activity of software licence distribution and management is highly synergistic to our other business activity of providing ICT training and certification. As we are partners with many of the global technology and software vendors and organisations for the provision of training and certification of their products and services, it was a natural business extension to also distribute and manage their product licences. A software licence is a legal contract between the user and owner of the software to use the software subject to terms and conditions set out by the owner. Types of software licences that we distribute and manage include application, operating systems, communications and systems and development tools and utilities. Currently, we are mainly distributing software licences to Government agencies and organisations based on volume purchase arrangements. We offer software licence management services to streamline the process of software inventory, software upgrade and licence management to increase efficiency and improve the ability to promote IT governance through software IP compliance. Within our software licence distribution and management operations, we carry out the following activities:­• manage software licences and related contracts;
• identify installed software products;
• capture proof of purchase and agreement terms and conditions;
• import licence record and data from multiple sources to match installed software products with existing software licences;

• organise the licences with tracking system to get reminders of upcoming renewals and upgrade of dependent licences; • provide easy access to users regardless of their physical locations;
• consolidate software inventory across entities and departments;
• map dependencies and define relationships as necessary to support complex licensing requirements;
• facilitate development of database of up-to-date software inventory and licence compliance information to ensure that licences owned are aligned with software used and to validate their compliance; and
• produce software licence compliance report and status.

As at the LPD, we are a certified partner of the following technology and software vendors and organisations for the distribution of software and solutions in Malaysia:­• Microsoft Large Account Reseller (LAR)-Licensing Solutions since 2006; and
• Autodesk Value Added Reseller-Education Partner.

As at the LPD, we have managed and distributed approximately 878,621 Microsoft licences and 15,410 Autodesk licences to various Government bodies in Malaysia since 2006. In 2010, we secured, among others, the following new contracts:­• a three (3}-year contract from the IRB to supply and manage Microsoft software licences for 8,000 computers and to provide ICT training; and
• a 20-month contract from the MOE to supply and manage Microsoft software licences for approXimately 10,000 public schools and matriculation colleges in Malaysia under the EM Programme, which covers 300,000 computers.

67 4. INFORMATION ON OUR GROUP (Cont’d) In 2011, we secured a three (3) year contract from the MOE to supply and manage Microsoft software licences to the District Academic Department, Institutes of Teacher Education and other MOE agencies (excluding matriculation colleges and schools). Essentially, we distribute and manage the following:­(a) Microsoft Software Licences Microsoft CASA is a licence distribution and management programme designed to cater to the needs of public primary and secondary schools, and higher education institutions. We are currently focusing on licence distribution and management to higher education institutions. This part of the programme mainly covers software licence management such as managing and organising software licences, as well as providing cost effective software acquisition on an annual or as needs basis. This enables licensed users to run the most current version of the software products. Microsoft MLA is a Microsoft Master Licensing Agreement in respect of a customised licensing programme for Malaysian Government entities to acquire Microsoft solutions. Endorsed by the Malaysian Government under the Pekeliling Kontrak Perbendaharaan, Bil 3 2008 (PKP 3/2008), It was initiated to help the Government improve licence management, streamline administration and budget for software procurement. Microsoft SELECT is a licensing programme designed for medium and large organisations with 250 desktop personal computers or more, and having mixed software requirements. All the software purchased through this licensing programme provides users the right to run Microsoft software products. (b) Autodesk Software Licences Autodesk Education Suite Licensing offer a broad range of two (2) and three (3)­dimension design and engineering software products that provide educators with access to professional tools to help encourage students pursue multidisciplinary learning. The Suite are sold in value-priced packages that include multiple seats of each suite aligned with any size education institution from a single small classroom to the largest institution. [The Rest Of This Page Is Intentionally Left Blank] I Company No: 922260-K I 4. INFORMATION ON OUR GROUP (Cant/d) 4.3.3 Approvals, Major Licences And Permits As at the LPD, the details of the approvals, major licences and permits obtained by our Group for the operation Of our business are set out below:­Licences And Permits Held By MOF contractor licence granted to PSSB  Authority MOF  (Registration Ref No.: 357-1(1) 02022936; Serial No.: 328600) Date Of Issuance! Date Of Expiry Valid from 20 January 2010 until 19 January 2013 Description Registration of PSSB with the MOF in the sector/ fields of supply/ services under the following headings:­(1) 210101: Personal computer and related peripheral services. (2) 210102: Small to large multi­user systems & services. (3) 210103: Workstations and related peripheral and services, (4) 210104: Software product and services. (5) 210105: Other computer related services. (6) 210106: Networking product and services. Major Conditions Imposed PSSB has to ensure that the fields or area of work in which PSSB has registered with the MOF are not replicated with other company(s) registered in the same field where the shareholders, the board of directors and/or management of both companies are the same. (2) The MOF has the right to cancel/suspend registration of PSSB without any notice given if they discovered the information provided by PSSB is false or incorrect. (3) PSSB shall not within six (6) months from the date of registration, make any changes to its shareholders or board of directors. (4) Registration of PSSB will be suspended/ cancelled if:­(a) PSSB revokes its offer before its tender is considered or revokes its tender offer once the award is given. (b) PSSB allows its registration certificate to be misused by another  Status Of Compliance Met Noted Met Noted
69 I Company No: 922260-K I 4. INFORMATION ON OUR GROUP (Cant’d) Licences And  Authority  Date Of Issuance/  Description  Major Conditions Imposed  Status Of  Permits Held By  Date Of Expiry  Compliance  company.  (c)  The  Company  fails  in  performing  any  contracts  awarded  by  the  Government.  (d)  The company is found  to  conspire  with  another  company  as  regards  to  pricing when entering into  a Government tender.  Bumiputera Status  MOF  Valid  from  20 I (Registration  Ref  No.:  357-1(1)  PSSB adopts all  measures  to  granted to PSSB  January 2010 to 19  02022936; Serial No.: 205105)  consistently ensure that:­ January 2013  Registration  of  PSSB  with  the  (a)  Bumiputera  participation  Noted and Met  MOF as a Bumiputera Contractor  of  more  than  51% at  shareholders’ level, board  of  directors’  level  and  employees/staff  including  the  management  of  PSSB.  (b)  With  regards  “Bidang  Not applicable  Agen  Pengembara  dan  Percetakan”,  100%  Bumiputera  participation  must  be  maintained  at  shareholders’ level, board  of  directors’  level  and  management  (including  the  finance  department)  level. PSSB shall employ  no  less  than  80%  of  Bumiputera  as  its  employee  and  shall  not  involve  the  participation  on non-residents.
70
I Company No: 922260-K I 4. INFORMATION ON OUR GROUP (Cont’d) Licences And Permits Held By  Authority  Date Of Issuancel Date Of Expiry  Description  Major Conditions Imposed  Status Of Compliance  (c)  As a majority, Bumiputera must mainly play an important role in the management of PSSB, overseeing the progress of PSSB, financial matters, decision making and represent PSSB in all meetings and other formal events.  Noted and Met  (2)  Notification shall be given to the I MOF in relation to any change of the above condition. Failure to make such notifications shall raise doubt on the part of the MOF as to the authenticity of PSSB’s Bumiputera status.  Noted  (3)  In the event PSSB has I delegated the management of PSSB and its contracts to any other party, the MOF will revoke PSSB’s Bumiputera status.  Noted  (4)  The MOF has the right revoke this certificate if:  to  I  Noted  (a)  Bumiputera PSSB is revoked.  status cancelled  of or  (b)  PSSB’s registration is suspended or cancelled.  (c)  There are amendments made to this certificate which are fraudulent or for any other purpose.
71
I Company No: 922260-K I 4. INFORMATION ON OUR GROUP (Cont’d) Licences And  Authority  Date Of Issuance/  Description  Major Conditions Imposed  Status Of  Permits Held By  Date Of Expiry  Compliance  Registration of  Pembangunan  Approval  granted  Serial No.: 1770  PSSB  adopts  all  measures  to  Training Provider  Sumber Manusia  on  11  March 2010  consistently ensure that:­ Certificate  Berhad (“PSMB”)  and  expired  on  8  Registration of Training Provider  granted to PSSB  March 2011. It has  Certificate  permitting  PSSB  to  1(1)  Registered  or  incorporated  in  Met  subsequently  been  undertake and conduct PROLUS  Malaysia under the Companies  renewed  effective  scheme  including  E­ Commission  of  Malaysia  from 9 March 2011  learning/PERLA/SBLISBL­ (Registration  of  Company  or  to 8 March 2012  KHAS/apprenticeship  scheme  Registration  of  Business)  or  under registration category A  Registration of Society.  (2)  With  an  office,  a  minimum  of I  Met  one  (1)  training  room  and/or  computer  laboratory  and/or  workshop with training facilities,  at  least two  (2) full-time  local  trainers  and  supporting  staff.  Training  providers  under  this  category must have offered in­ house  or  public  courses/  programmes for at least 1 year.  (3)  The  minimum  size  for  a I  Met  training room under category A  must  be  at  least  35m2  irrespective of the length and  width.  Flip  chairs  are  strictly  not allowed.  (4)  All trainers must have attended I  Met  the  Train-The-Trainer  course  within  one  (1)  year  after  registration.  (5)  Register  all  training I  Met  programmes  under  the  HRD  Portal. All  training  programme  approved by  PSMB  will  have  validity date of three (3) years.
72 I Company No: 922260-K I 4. INFORMATION ON OUR GROUP (Cont’d) Licences And Permits Held By MSC Status granted to PSSB  Authority The Government of Malaysia as represented by the MOF and the MITI  unrestricted 1(3) KWs are defined:­Date Of Issuance/ Date Of Expiry Approval granted on 15 June 2005 Description Serial No.:1189 MSC Status companies are entitled for a set of incentives, rights and privileges from the MSC Malaysia Bill of Guarantees:­(1) to provide a world-class physical and information infrastructure. (2) to allow employment of local and foreign knowledge workers. (3) to ensure freedom of ownership by exempting companies with MSC Status from local ownership requirements. (4) to give the freedom to source capital globally for MSC infrastructure, and the right to borrow funds globally. (5) to provide competitive financial incentives, including Pioneer Status (100 per cent tax exemption) for up to ten (10) years or an Investment Tax Allowance Major Conditions Imposed (6) To inform PSMB about change of company’s name and change of premises at headquarter/ branches. PSSB adopts all measures to consistently ensure that:­(1) Provider/Developer and/or heavy user of multimedia products and services. (2) Employ substantial proportion of knowledge Workers (“KWs”), i.e. total KWs must be 15% of total employment of company. (a) Academic qualification (Degree) from an institute of higher learning (any field), or (b) Diploma in multimedia/ ICT or specialized ICT certification piUS at least two (2)’ years relevant experience in multimedia/ ICT or in a field that is a heavy user of ICT; or (c) Professional, executive, management and technical, work categories in IT-enabled services, e.g. IT/IS professionals, finance/accounting, business admin.  Status Of Compliance Met Met Met Noted
73
I Company No: 922260-K I 4. INFORMATION ON OUR GROUP (Cont’d) Licences And . Permits Held By  Authority  Date Of Issuance! Date Of Expiry  Description  Major Conditions Imposed  Status Of Compliance  for up to five (5) years and  (d) Also include:­ no duties on the importation  of multimedia equipment.  (i) SSO: Foreign workers with the  (6) to become a regional leader  required knowledge- in IP Protection and  based skills not  Cyberlaws.  prevalent in Malaysia.  (7) to ensure no censorship of  the Internet.  (ii) CMC: Workers who are utilized for their  (8) to provide globally competitive telecommunications tariffs.  creative talent to produce value-add creative works for the company.  (9) to tender key MSC infrastructure contracts to leading companies willing to use the MSC as their regional hub.  4 I( ) Strong value propositions specifying how operations will contribute to the development of the MSC Malaysia and Malaysia.  Met  (10) to provide a high-powered  (5) Establish a separate legal entity  Met  implementation agency to  for MSC Malaysia-qualifying  act as an effective one-stop  activities.  super shop.  (6) Comply with environment I guidelines.  Met
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I Company No: 922260-K I 4. INFORMATION ON OUR GROUP (Cont’d) Licences And Permits Held By Pioneer Status granted to PSSB  Authority MITI  Date Of Issuance/ Date Of Expiry Description Major Conditions Imposed Terms and conditions for company enjoying Pioneer Status:­(1) The first five (5) years was 1(1) valid from 30 June 2005 to 29 June 2010; and (1) Company granted Pioneer Status must within six (6) months request for a pioneer certificate, specifying among others the date of production from which the partial exemption/full exemption will be granted. Capital allowances have to be utilised during the pioneer period and will not be allowed to be carried forward to the post pioneer period. tax­to be Losses unabsorbed during the pioneer status will not be allowed to be carried forward to the post pioneer period except for Pioneer Status for contract research and development company. Dividends paid out of exempt income shareholders will also exempted from tax. Continuation of research, design, develops and deploy a training content, delivery engine that will enable the delivery of training services to teachers and civil servants. PSSB qualifies the following MSC Malaysia qualifying activities:­(2) Research and development I (2) of new certification for global market. A company that provides research and development services in Malaysia will be granted full tax exemption on 100% of the statutory income for I (4) five (5) years. (3) Provision of technical support and maintenance I (3) services related to the training systems above. Pioneer Status period:­Pioneer Status Certificate no. 3087 dated 22 July 2008 (2) The Second five (5) years is valid from 30 June 2010·to 29 June 2015  Status Of Compliance Noted Noted Noted Noted
[The Rest Of This Page Is Intentionally Left Blank] 75 4. INFORMATION ON OUR GROUP (Cont’d) 4.3.4 Brand Names, Registrations, Patents, Trade Marks, Licences, Technical Assistance Agreements, Franchises And Other Intellectual Property Rights Save for the copyrights obtained pursuant to the Copyright Act 1987, the sub-licence agreement dated 1 January 2010 between APM Group Limited and PSSB and the trademark applications flied by our Group with the Trade Mark Registry pursuant to the Trade Mark Act 1976 and Trade Mark Regulations 1997 as described below, our Group does not have any patents, technical assistance agreements, franchises and other IP rights as at the LPD:­(i) Copyrights Through our in-house R&D effort, PSSB has obtained the following statutory declarations for the copyrights in relation to our business operations in 2009 and 2010:­2009 (a) Provision of technical support and maintenance services related to the training systems.
Lab visit form and lab return form Authorised Prometric testing centre form Autodesk software licensing requirement (ASLR) Total Number of Statutory Declarations 10 10 3 23 2010  (a)  Research, design, develop and, deploy a training content delivery engine that will  enable the delivery of training services to teachers and civil servants.

leMS training proposal Training Module Phase 1 Training Module Phase 2a 76 3 6 8 4. INFORMATION ON OUR GROUP (Cont’dj Copyright  No. of Statutory Declarations Signed  Training Module Phase 2b  6  Training Module Student  5  ICMS Technical Training  4

(b) Provision of technical support and maintenance services related to the training systems mentioned above.
Project Status Report  5  MoH -ICMS Issue Bug Report ICMS -Issues DefectfTracking Lo  5  Total Number of Statutory Declarations  10
The above statutory declarations for our copyrights are used as supporting documents asserting the copyright on our works for copyright protection under the Copyright Act 1987. As the Copyright Act 1987 does not create a central registry of sorts (unlike the Trade Marks Registry), date of creation for items entitled to copyright protection cannot be immediately ascertained by reference to a single source. As such, it becomes imperative that copyright owners take steps to document the creation of their copyrightable works. One of the most important steps in copyright protection is the establishment of the date of first creation, since copyright protection is time-sensitive. A statutory declaration is one of the best ways in which this can be established, since it documents a legally binding declaration by the creators that the work(s) were created on a particular date. (ii) Trademarks PSSB has submitted the following trademark applications to the Trade Marks Registry in Malaysia:­Trade Mark  Trade Mark Number  Date of Application  Class  3ft.  2010006318  12 April 2010  16  2010006319 2010006322 2010006323  12 April 2010 12 April 2010 12 April 2010  41 16 41  flyingstartmalaYSia
4. INFORMATION ON OUR GROUP (Cont’d) 4. INFORMATION ON OUR GROUP (Cont’dj

Notes:­Class 16: Booklets, Bookmarkers, Books, Cards, Catalogues, Envelopes stationery, Files office requisites, Forms printed, Handbooks manuals, Newsletters, Note book; all included in Class 16. Class 41: Arranging and conducting of seminars, Arranging and conducting of workshops training, Education information, Educational services, Information (Education-) Publication of texts other than publicity texts, Vocational guidance education or training advice, Workshops (Arranging and conducting of-) training; all included in Class 41. 4. INFORMATION ON OUR GROUP (Cont’d) All the above mentioned trademarks are to be issued and licensed by the Intellectual Property Corporation of Malaysia (Perbadanan Harta Intelek Malaysia). The approval process between an application being filed and for it to be officially registered, normally takes approximately 18 months. (iii) Trademarks Licenced Under Licence Agreement (a) By a Licence Agreement (Intellectual Property SUb-licence) dated 1 January 2010 between APM Group Limited (as the sub-licensor) (“APMG”) and PSSB (as the sub­licensee), PSSB has obtained a right to use the trademarks of ITIL (“ITIL Trademark(s)”), the ITIL licensed affiliate logo and the crown copyright material (the range of registered ITIL material produced by or on behalf of Office of Government Commerce (“OGC”) which is subject to the licensing by the Office of Public Sector Information) (“Crown Copyright Material”) based on the terms and conditions of the Licence Agreement. The salient terms of the Licence Agreement are as follows:­• The OGC is the proprietor of the registered ITIL Trademark(s) and certain unregistered trademarks. By a head licence agreement dated 20 July 2006, OGC granted to APMG the right to grant sub-licences in relation to the registered ITIL Trademark(s) and unregistered trademarks. APMG has also been granted by OGC the right to grant sub-licences of certain Crown Copyright Material.
• The Licence Agreement shall be effective for a period of 24 months.
• Under the Licence Agreement, ATO in the Licence Agreement means Quint Wellington Redwood Group which holds current accreditation by an EI for the provision of training and examinations courses in ITIL.
• Under the Licence Agreement, EI means an examination institution which hold current accreditation by APMG for the provision of certification and accreditation of ATO’s.
• Under the Licence Agreement, affiliate agreement means the agreement between the Company and ATO for the provision of services in the form approved by APMG.
• The purpose of sUb-licensing the ITIL Trademarks, ITIL licensed affiliate logo and the Crown Copyright Material by APMG to PSSB are as follows:­
(1) to provide marketing and promotional services in worldwide on behalf of one or more ATO’s under the relevant affiliate agreement;
(2) to provide training services on behalf of the ATO under the relevant affiliate agreement in accordance provisions under the Licence Agreement;
(3) to print Crown Copyright Material incorporated in training materials by the ATO for the purpose only providing the training services.

 

[The Rest Of This Page Is Intentionally Left Blank] 4. INFORMATION ON OUR GROUP (Cont’d) 4.3.5 Strategies And Modes Of Marketing (i) Marketing Strategies Our sales and marketing team utilises the following strategies to sustain and expand our business:­• Position ourselves as a provider of ICT training and certification, and software licence distribution and management with a proven track record as reflected in the number of our certified participants, as well as number of participants enrolled in our training courses.
• Strengthen our business relationships with customers by working in partnership with them to ensure that their requirements are satisfactorily met, via a solution sales approach. This will provide the basis for us to secure new projects in the future and serve as a reference site for new customers. As an example, we work together with our customers to develop training solutions and courses that are in line with industry development and market needs.
• Promote and market our Group’s services and capabilities by conducting briefings and seminars to students, staff and lecturers from public higher education institutions, as well as civil servants from the Malaysian Government agencies. This is to increase product and service awareness among our existing and potential customers, and to highlight the benefits and needs of continuous assessment by way of training and certification specifically for ICT skills and knowledge.
• Focus on areas of growth and opportunities which we foresee will be in the area of basic ICT training and certification. In addition, our provision of ICT training and certification also aims to provide upskilling opportunities for graduating students and practising professionals to help them expand their skill sets for career advancement.
• Carry out research to develop new training solutions and certification programmes to address new requirements to stay ahead of the competition and enlarge our customer base.

As at the LPD, we have a team of eight (8) personnel in sales and marketing focusing on sales, marketing and business development functions. To implement the above marketing strategies, we will adopt the following broad based approaches:­• raise and enhance our corporate profile and market awareness to gain market share by actively participating in exhibitions, universities’ activities, and seminars;
• establish strategic alliances with business partners and principals so as to cultivate mutually beneficial relationships; and
• explore geographical expansion strategies to address areas of growth and opportunities.

Our Group has participated in various events including the following:­Year  Names Of Events  Location  2006  Pameran Teknologi Pendidikan Peringkat Gabungan Tawau 35th National Teachers’ Day Konvensyen Guru Kebangsaan Dalam leT 2006  Sabah Kuala Lumpur Kuala Lumpur
4. INFORMATION ON OUR GROUP (Cont’d) Year  Names Of Events  location  2007  Microsoft 3rd Regional Innovative Teachers’ Conference Pameran Program Perkongsian Pintar Ke Arah Pembestarian Sekolah Kebangsaan 2007 UiTM ICT Symposium MSDNAA Academic Day 2007 (Community Colleges) MSDNAA Academic Day 2007 (Polytechnics) MSDNAA Academic Day 2007 (Community Colleges) Autodesk National Education Conferenye 2007 IT Security Seminar 2007, Microsoft Malaysia Sdn Bhd Microsoft Tech.Ed  Siem Reap, Cambodia Melaka Universiti Teknologi MARA, Pulau Pinang Jitra,Kedah Seberang Prai, Pulau Pinang Kuala Langat, Selangor Langkawi, Kedah Kuala Lumpur Kuala Lumpur  2008  Snap-A-Job 2008 MUSE 3’0 Annual Seminar  Kuala Lumpur Langkawi, Kedah  2009  Karnival Ke~aya & Keusahawanan 2009 Snap-A-Job 2009 MUSE 4lh Annual Seminar  Kuala Lumpur Kuala Lumpur Kota Kinabalu, Sabah  2010  Karnival Ke~aya & Keusahawanan 2010 Autodesk Education Summit 2010, UTM International Autodesk Special Interest Group (SIG) Seminar & Workshop  Kuala Lumpur Kuala Lumpur Universiti Malaysia Kelantan, Kelantan
(ii) Distribution Strategies Direct Distribution Model As an ICT service provider for ICT training and certification, and software licence distribution and management, we primarily adopt a direct distribution model strategy for the provision of our services whereby we market directly to customers using our own sales and marketing personnel. This model enables us to work and interact closely with our customers as well as participants and users to attain a better understanding of their needs, which serves as a feedback mechanism for continuous improvements. Indirect Distribution/Channel Model In addition, we also adopt an indirect distribution model using intermediary, mainly providers of authorised test centres. The strategy of adopting an indirect distribution model enables us to utilise the existing network of providers of authorised test centres to expand our market coverage without the need of significant investment in marketing and logistics.

4. INFORMATION ON OUR GROUP (Cont’d) In 2010, we signed a partnership agreement with Certiport from the US, to market our “IC CITIZEN” training and certification programme. Certiport has a network of approximately 10,000 centres in 142 countries. 4.3.6 Business Process (i) Process Flow For ICT Training And Certification Our Group’s general process flow for ICT training and certification is as follows:­Preparation of Proposal and Quotation
~
Implementation and Kick-off
+ Project Management and Monitoring ResourcesManpower ManagementStaffing (Recruitment of trainers) I I … Billing and Collection + Project Completion and Reporting Upon the identification of a potential project, a project team consisting of a project manager and assistant manager, representative from the accounts and finance department, site managers, and support staff is formed. The project team carries out a detailed cost analysis, and prepares and submits the proposal and quotation documents to the customer, for example the MOHE. Once the proposal is approved and a contract awarded to us, the project implementation and kick-off process begins with a technical evaluation on the clients facilities, for instance the higher public education institutions, and technical capabilities to ensure sufficient facilities are available including classrooms and computer facilities. The next process is project management and monitoring. Certified trainers and other third party services providers are identified and recruited upon evaluation and confirmation from the project manager. In addition, sub-contractors and suppliers are appointed to supply the course materials. Under the billing and collection process, an invoice is produced based on information such as operational costs contained in the progress report and submitted to the client. 83 4. INFORMATION ON OUR GROUP (Cont’d) Upon completion of the proiect, a final report is prepared by the project team and presented to the client. (ii) Process Flow For Software Licence Distribution And Management The general process flow for software licence distribution and management is as follows:­Identify Potential Customer
+
Study Customer’s Needs
+
Identify Potential Software Programmes for Customers +
Demonstration of Identified Software
+
Finalise Agreements +
Deployment and Execution
Upon the identification of a potential customer, an opportunity assessment is made which identifies budget, facility and user requirements including software programmes and software licences. We then undertake a study on .customer’s requirements and needs to establish sponsor relationships in supplying the relevant software licences solutions that optimise customer’s needs. The customer is presented with a range of software programmes that would complement the ICT training and certification courses. A trial run displaying the functions of the identified software programmes is demonstrated to the customer. Once contractual agreements have been reached and finalised, the software programmes and software licences are deployed and provided to the customer. An invoice is produced and submitted to the customer. [The Rest Of This Page Is Intentionally Left Blank] 4. INFORMATION ON OUR GROUP (Cont’dj 4.3.7 Quality Management Procedures The quality of our training services is critical to our Group. We continuously strive to position ourselves as a reputable provider of ICT training and certification in the industry providing quality training and services. Some of the measures that we have adopted in ensuring the quality of our training services include:­• Implementing a series of adequate quality assurance procedures to ensure the provision of our teaching and learning services are consistent and complies with our standards. The procedures encompass all aspects of staffing, training and induction, teaching and learning, management, administration and other services.
• Development of training solutions including enhancement of curriculum of existing training courses as well as introduction of new courses in line with industry development and needs.
• Continuous development of the knowledge and skills of our professional trainers, technical and administrative staff to keep abreast with current teaching methodologies while enhancing the quality of the learning experience in terms of content or pedagogy, as well as to ensure that courses are well managed and consistently presented. We also adopt overseas best practices through attending training and conferences overseas to improvise knowledge into our procedures and. programmes to ensure the quality of our training services.

In addition, we also work closely with our vendors to adhere to the necessary standards of our training solutions including assessments, original training material and mapping the necessary certifications to local standards. A summary of the number of participants for ICT training and certification under the 3P Programme and the RBTCS Programme is presented in the table below:­
161 1,096 406 69% 50% 49% Note:­(a) For 2011, the training and certification for the 3P Programme commenced in May 2011. 4.3.8 Interruptions In Operation As at the LPD, we have not experienced any material interruptions to our business operations over the past 12 months. 4. INFORMATION ON OUR GROUP (Cont’d) 4.3.9 Principal Markets And Seasonality (i) Principal Markets For FYE 2010, our principal market is Malaysia where we provide ICT training and certification, and software licence distribution and management.
Malaysia (ii) Seasonality The provision of our ICT training and certification under the 3P Programme experiences a peak in activities during the semester breaks for public higher education institutions in Malaysia. This commonly falls during the months from May to July, and November to December. However, throughout the year, we conduct ICT literacy training to civil servants under the RBTCS Programme coordinated by the MOF.
4.3.10 Major Customers Our Group’s major customers who contributed at least 10.00% of our total revenue for the past three (3) FYEs 2008 to 2010 are as follows:­Customer  Percentage Of Total Revenue  FYE 2008 FYE 2009 FYE 2010 67.41 90.92 63.14 –11.74 29.32 -0.03 46,358 39,425 58,520  MOHE(a) IRB(b) MOH(c)  Our Group’s Total Revenue (RM’OOO)
Notes:­(a) Up to FYE 2010, we have approximately five (5) years of relationship with this customer, of which we provided ICT training and certification under the 3P Programme and software licence distribution and management under the MUSE Programme.
(b) Up to FYE 2010, we have approximately one (1) year of relationship with this customer, of which we supplied and managed Microsoft software licences.
(c) Up to FYE 2010, we have approximately three (3) years of relationship with this customer, of which we provided software licence distribution and management service under the ICMS Programme in FYE 2008 and provided basic ICT training in FYE 2010.

MOHE, IRB and MOH are Government entitieslrelated entities and we are highly dependent on them. From FYE 2008 to FYE 2010, the MOHE has been our top customer who contributed more than 63% of our Group’s revenue. The revenue from the MOHE was mainly generated from the 3P Programme and MUSE Programme. 4. INFORMATION ON OUR GROUP (Cont’d) In FYE 2009, our Group’s revenue was mainly derived from the 3P Programme and MUSE Programme awarded by the MOHE following the completion of the BPPT Programme and ICMS Programme in FYE 2007 and FYE 2008 respectively. Our dependency on the MOHE has reduced in FYE 2010 as compared to FYE 2009 as we managed to secure a new contract from the MOE to supply Microsoft software licences to schools and matriculation colleges. We also managed to broaden our customer base by securing a contract from the IRB to supply and manage Microsoft software licences as well as to provide ICT training to the IRB. In addition, we also have other contracts with customers to undertake the other projects such as the RBTCS programme. All these additional contracts will help us secure continuous revenue stream and provide some assurance of business continuity for the duration of the contracts. The total revenue contribution from customers that are Government entitieslrelated entities for the past three (3) FYEs 2008 to 2010 are as follows:­
We believe that our established track record and reputation which is associated with quality, reliability, service excellence, good deliverable record as well as our continuing business relationship with our major customers will provide the basis for continuing business growth. Apart from Government entities/related entities, we also service other types of customers including systems and network integrators, hardware suppliers as well as maintenance service providers for hardware and equipment. However, revenue derived from this customer base is relatively insignificant at the moment. 4.3.11 Major Suppliers Our Group’s major supplier with purchases of at least 10.00% of our total purchases for the past three (3) FYEs 2008 to 2010 are as follows:­Supplier  Percentage Of Total Purchases  FYE 2008 FYE 2009 FYE 2010 27.93 44.64 67.44 10.34 5.86 3.74 15.57 14.55 -27,693 23,193 39,878  Microsoft Regional Sales Corporation, Singapore(a) Prometric group of companies(b) ACA Pacific Technology (M) Sdn Bhd(c)  Our Group’s Total Purchases (RM’OOO)
Notes:­(a) Up to FYE 2010, we have approximately seven (7) years of relationship with this supplier for the purchase of Microsoft software licences.
(b) Up to FYE 2010, we have approximately five (5) years of relationship with this supplier mainly for the purchase of examination vouchers.
(c) For FYE 200Band FYE 2009, we have approximately two (2) years of relationship with this supplier for the purchase ofAutodesk software licences.

4. INFORMATION ON OUR GROUP (Cont’d) From FYEs 2008 to 2010, the percentage of our purchases from Microsoft Regional Sales Corporation, Singapore has been increasing to support our business expansion and the projects undertaken by us. Our purchases from Microsoft Regional Sales Corporation, Singapore was mainly for the purchases of Microsoft software licences including those under the Microsoft MLA, and also other licences under the Microsoft CASA and Microsoft SELECT for public higher education institutions, and courseware for the 3P Programme. Our Group purchased less examination vouchers from the Prometric group of companies in FYEs 2009 and 2010 as it stopped conducting examinations for certain courses. Accordingly, we purchased the examination vouchers for such courses from Pearson Vue. For FYEs 2008 and 2009, ACA Pacific Technology (M) Sdn Bhd accounted for 15.57% and 14.55% of our Group’s total purchases respectively. This was mainly for the supply of Autodesk software licences for business operations. In 2010, we started to deal directly with Autodesk for the purchase of Autodesk software licences, of which our purchases from Autodesk accounted for 6.83% of our Group’s total purchases. 4.3.12 Types, Sources And Availability Of Resources (i) Purchases And Sources Of Products And Services Following are the major types of purchases for our business operations for FYE 2010:­FYE 2010  Value (RM’OOO) 29,230 4,216 4,871 1,561 39,878  Percentage Of Our Group’s Purchases (%) 73.30 10.57 12.21 3.92 100~00  Software licencesla) Third party trainers’ fees Examination vouchers and courseware Others1b)  TOTAL
Notes:­(a) Includes Microsoft, Autodesk and Adobe software licences.
(b) Includes purchases of books and materials, and travelling and accommodation expenses incurred by the trainers.

For FYE 2010, our Group’s main purchases are for software licences, which represented 73.30% of our total purchases. The purchases of our key software and licences, namely Microsoft and Autodesk are transacted with their respective regional offices. Nevertheless our main point of contact is still the local offices of Microsoft and Autodesk to drive sales and to build customer relationship. We also engage external certified trainers to conduct training under our supervision and control. For the FYE 2010, external certified trainers’ fees accounted for 10.57% of our Group’s total purchases. For the FYE 2010, we sourced all our certified trainers locally in Malaysia. For the FYE 2010, purchases of examination vouchers and courseware materials accounted for 12.21 % of our Group’s total purchases. These were all sourced directly from technology and software vendors and organisations. 4. INFORMATION ON OUR GROUP (Cont’d) For the FYE 2010, other purchases represented 3.92% of our Group’s total purchases. These include the purchases of books and materials, and travelling and accommodation expenses incurred by the trainers. Thus far, we have not experienced any material shortages in sourcing the above products and services for our operations. (ii) Availability Of Inputs To date, we have not faced any material shortages in the availability of products, third party certified trainers or any of the other inputs required by our Group. 4.3.13 Dependency On Patents, Licences, Industrial, Commercial Or Financial Contracts Or New Manufacturing Processes Our Board is of the opinion that, as at the LPD, save as disclosed in Section 4.3.3 of this Prospectus and below, we are not highly dependent on any single contract/arrangement/licences. (i) Highly Dependent Suppliers’ Contracts
(a) By an agreement dated 31 January 2011 entered into between APM Group Limited (“AMPG”) and PSSB, APMG has granted to PSSB, a non-exclusive and non­transferable licence in Malaysia to use the trade marks for performance of marketing and promotional services and the provision of marketing and promotional material by the contracted affiliate organisation in Malaysia on behalf of an accreditation training organisation (which hold current accreditation by APMG for the provision of training and examinations courses in ITIL) relating to the Office of Government Commerce (“OGC”) product ITIL®.

The salient terms of the agreement are as follows:­(1) APMG has worldwide rights to licence, market, distribute, support and develop the accreditation of organisations to deliver (TIL training courses and administer ITIL examinations under the trademarks of the OGC. APMG is the certification body for the accreditation of ITIL training organisations, the approval of ITIL trainers and certification of ITIL examination graduates.
(2) APMG has the right (granted to it by OGG) to sub-licence to PSSB certain intellectual property rights in connection with the marketing and promotion of accredited ITIL training courses, on behalf of one or more ATOs.
(3) The agreement is effective for a period of one (1) year commencing from the date of the agreement.
(4) PSSB warrants to APMG that:­
• It will not proVide or attempt to provide training courses, examinations or consultancy services in its own right in any way in connection with the ITIL for the duration of the agreement.
• The use of its marketing and promotional services by an ATO will not cause such organisations to exceed the territorial boundaries set for their accreditation in respect of ITIL by APMG.
• Financial arrangements between PSSB and the ATOs, its represents and between PSSB and its clients are the sole responsibility of PSSB.

 

4. INFORMATION ON OUR GROUP (Cont’d) • The PSSB will indemnify APMG for any losses, claims and professional or administrative costs incurred as a result of any action taken or contemplated by a third party in relation to any claim brought against APMG as a result, whether direct or otherwise, of the PSSB’s action, inaction or breach of the agreement. Provided that PSSB shall not be required to indemnify APMG in respect of any losses or claims arising which could not be said to be a reasonably foreseeable consequence of PSSB’s action, inaction or breach of the agreement. (5) PSSB is obliged to inform APMG forthwith in writing as to changes in its ownership or control, legal or commercial status and location of its premises.
(6) In the event of termination of the agreement:­
• the licence granted under the agreement shall terminate;
• PSSB shall if so requested by APMG execute an assignment in favour of the OGC (or such person as APMG may direct) of any and all goodwill in the trademarks as may have accrued to PSSB by reason of the use of the trademarks and by PSSB being connected with the trademarks in the course of trade and all such rights (if any) as may have accrued to PSSB in relation to the trademarks by reason of such one;
• PSSB shall not later than one (1) week from the date of termination or expiry remove or obliterate the trademarks from any marketing and/or promotional goods and materials which are in its possession custody or control;
• Any provision of the agreement which in order to give it effect needs to survive the termination of the agreement shall remain in full force and effect after termination.

 

(b) By a Microsoft channel agreement (resellers) entered into between Microsoft and PSSB, Microsoft has renewed the non-exclusive right of PSSB to participate in the selected list of Microsoft software licenses under various Microsoft volume licensing programmes to the customers. This renewal is effective from 1 September 2010 to 31 August 2011. The agreement has continuously been renewed on a yearly basis since year 2006. Under the agreement, PSSB is authorised to continue offering the following programmes within the geographical boundary of Malaysia:­• Campus Agreement
• School Agreement
• Enterprise Agreements (Indirect)
• Select
• Select Plus
• Get Genuine Windows Agreement (Large Corporations)

The salient terms of the agreement/renewal are set out as follows:­(1) Without Microsoft’s prior written consent, PSSB may not assign or transfer the agreement or its rights or obligation under it, whether by contract or by operation of law (such as merger or sale of PSSB’s stock). Any prohibited assignment is void. 4. INFORMATION ON OUR GROUP (Cont’d) (2) If a party breaches any terms of the agreement, the other party can terminate the agreement for cause. The terminating party will give the breaching party not less than 30 days’ written notice and opportunity to cure the breach if the cause for termination is curable. A party will be allowed to cure breach once, if a party breaches the agreement for the same reason as a prior breach such as late payment, then the other party may terminate the agreement immediately. If the cause for termination is not curable, termination is effective immediately upon written notice from the terminating party.
(3) Microsoft may terminate any programme designation form for cause without terminating the entire agreement. Microsoft will give PSSB not less than 30 days’ written notice and opportunity to cure the breach if the cause is curable. Ifthe cause for termination is not curable, termination is effective immediately upon written notice from Microsoft. If Microsoft terminates a programme designation form with cause, Microsoft will ask each of PSSB’s customers to choose a new channel partner. PSSB will not receive compensation for any customer orders for which payments are received after the date of PSSB’s term ination.
(4) When the agreement ends or is terminated:­
• PSSB must immediately stop using all rights granted by the agreement.
• PSSB must also pay Microsoft any amounts due under the agreement.
• Termination of the agreement terminates all programme designation forms and all programme guides under the agreement, and any amendments or addenda.
• Each party waives any right or obligation under applicable law or regulation to request or obtain intervention of the courts to terminate the agreement.

 

(c) By a Autodesk education partner agreement dated 1 November 2009 between Autodesk and PSSB, Autodesk agreed to supply to PSSB the educational and student version of Autodesk’s software (“Product”) and for PSSB to supply the Product to the end user within the geographical boundary of Malaysia, namely the public institutes of higher learning as instructed by the MOHE of the Government of Malaysia (“End User”). The agreement period commences from 1 November 2009 to 31 October 2012. By a letter of amendment (No.1) issued by Autodesk to PSSB, the effective date of the agreement has been changed from 1 November 2009 to 3 June 2010. The salient terms of the agreement are set out as below:­(1) PSSB may not assign, sub-licence, delegate or subcontract its rights, duties or obligations under the agreement without the express prior written consent of Autodesk. (2) the rights and obligations of PSSB under the agreement may not be transferred or assigned and its duties may not be delegated directly or indirectly without prior written consent of Autodesk in its sole and absolute discretion. PSSB acknowledges that any change of ownership, sale of all or substantially all of PSSB’s assets, or attempted assignment by PSSB of the agreement, or any part thereof, without Autodesk’s prior written consent may result in immediate termination of the agreement by Autodesk. 91 4. INFORMATION ON OUR GROUP (Cont’d) (3) PSSB shall not reproduce, modify, translate, adopt, reverse engineer or decompile any Autodesk software in whole or in part. PSSB shall not supplement, amend or modify any terms and conditions without the prior written consent of Autodesk.
(4) Either party may terminate this agreement by written notice:­

• upon the breach by one party of any of its obligations under the . agreement and failure to remedy the breach within 30 days following written notice from the other party; or • without cause upon 30 days written notice to the other party. In the event the entire agreement or PSSB’s appointment to distribute any products expires or terminates, neither party shall be liable to the other party for compensation, reimbursement or damages on account of the loss of prospective profits or anticipated sales or on account of expenditures, inventory, investments, leases or commitments in connection with a party’s business or goodwill. Termination shall not, however, relieve either party of obligations incurred prior to the termination and still remaining to be fulfilled following such termination. Further, neither party shall be entitled to any indemnification as a result of termination of the agreement. (5) PSSB will keep Confidential Information made available by Autodesk in strictest confidence and PSSB shall limit the use of and access to Autodesk Confidential Information to PSSB’s employees or authorised representatives who have (i) a need to know and have been notified that such information is Confidential Information to be used solely for purposes consistent with PSSB’s obligations pursuant to the agreement, and (ii) enter into binding confidentiality obligations no less protective of Autodesk than those contained in the agreement. In compliance with item (5) above, we have obtained a letter of consent on 3 December 2010 to disclose the contents of the agreement in this Prospectus. (d) By a Autodesk Value Added Reseller (“VAR”) authorisation form effective from 8 September 2008 together with the general terms and conditions issued by Autodesk to PSSB, PSSB has been appointed as a indirect VAR reseller of various Autodesk commercial and not for resale (“BFR”) versions of software product (“Products”). The agreement period commences from 8 September 2008 until the then current Autodesk Fiscal Year, namely 31 January 2009 and shall renew automatically on an annual basis for up to two (2) successive 12 months periods comporting to the Autodesk Fiscal Year. By a letter of renewal dated 24 January 2011, the agreement has been renewed for a period of 12 months for the next Autodesk Fiscal Year commencing from 1 February 2011 to 31 January 2012. The salient terms of the agreement are set out as below:­(1) PSSB shall not appoint any sub-reseller broker, or grant any agency concerning Products, or purchase product through the agreement for PSSB or its affiliates’ own internal data processing needs without express written consent of Autodesk.
(2) PSSB shall not reproduce, modify. translate, adapt, reverse engineer or decompile any Product in whole or in part without the express prior written consent of Autodesk and Autodesk, Inc.

4. INFORMATION ON OUR GROUP (Cont’d) (3) PSSB shall not assign its rights or delegate its duties without the prior written consent of Autodesk.
(4) Autodesk may terminate the agreement according to written notice given upon the following events:­
• breach by PSSB of any of its obligations under the agreement and failure to remedy the breach within 30 days following written notice of Autodesk;
• transfer or cessation by PSSB of any part of its business relating to distribution of Products or transfer by PSSB owners or shareholders of a controlling interest in PSSB; or
• a receiver or similar officer is appointed for the benefit of PSSB’s creditors, or if PSSB becomes the object of any proceedings for bankruptcy, insolvency or the like; or
• if PSSB contents Autodesk’s or any of its affiliates’ IP rights, or attempts to register any domain name using an Autodesk product or service name, trademark, trade name, logo or any designation communicated confidentially to PSSB by Autodesk.

 

(5) PSSB will keep Confidential Information made available by Autodesk in strictest confidence and PSSB shall limit the use of and access to Autodesk Confidential Information to PSSB’s employees or authorised representatives who have (i) a need to know and have been notified that such information is Confidential Information to be used solely for purposes consistent with PSSB’s obligations pursuant to the agreement, and (ii) enter into binding confidentiality obligations no less protective of Autodesk than those contained in the agreement.

Further, by Letter of Amendment No. 1 to the aforesaid agreement dated 29 April 2009, the effective date has been amended to start from 1 February 2009. All terms and conditions of the aforesaid agreement which are not modified in the amendment shall remain in full and effect and in the event of a conflict between the terms of the agreement and the amendment, the terms of the amendment shall apply. In compliance with item (5) above, we have obtained a letter of consent on 3 December 2010 to disclose the contents of the agreement in this Prospectus. [The Rest Of This Page Is Intentionally Left Blank] 4. INFORMATION ON OUR GROUP (Cont’dj (ii) Highly Dependent Customers’ Contracts
(a) By a letter of award dated 15 March 2011 issued by the MOHE to PSSB, PSSB has been appointed to provide the 3P Programme at the selected universities, polytechnics and community colleges for a period of four (4) years with a total consideration of RM80 million (RM20 million per year). PSSB has obtained a performance bonds from Bank Muamalat Malaysia Berhad in favour of the MOHE on 24 March 2011 for a sum of equivalent to 5% of one (1) year of the agreement price amounting RM1,000,000.00 to secure due performance of PSSB under the agreement.
(b) Bya letter of award dated 15 March 2011 issued by the MOHE to PSSB, PSSB has continued to be appointed for the Supply of Software under “Pembekalan Perisian Microsoft untuk semua IPTA, Politeknik dan Kolej Komuniti di bawah Kementerian Pengajian Tinggi” for a period of four (4) years commencing upon the expiration of item (i) below, namely 1 July 2011. The agreement price of this agreement is RM40 million (RM10 million per year) and PSSB has obtained a performance bonds from Bank Muamalat Malaysia Berhad in favour of the MOHE on 24 March 2011 for a sum of equivalent to 5% of one (1) year of the agreement price amounting to RM500,000.00 to secure due performance of PSSB under the agreement.
(c) Bya letter of award dated 25 January 2011 issued by the MOE to PSSB, PSSB has been appointed to supply Microsoft software licence for the District Academic Department, Institutes of Teacher Education and other MOE agencies (excluding matriculation colleges and schools) for a period of three (3) years. The agreement price is RM8,052,920.74 and PSSB has obtained a performance bonds from Bank Muamalat Malaysia Berhad in favour of MOE on 8 February 2011 for a sum of equivalent to 5% of the agreement price amounting to RM134,215.35 to secure the due performance of PSSB under the agreement.

[The Rest Of This Page Is Intentionally Left Blank] 4. INFORMATION ON OUR GROUP (Cont’d) (d) By a letter of agreement dated 24 July 2010 issued by the Microsoft (Malaysia) Sdn Bhd to LSB, LSB has been appointed as a provider of ICT training for teachers and student development activities under the Partnership for Technology Access initiative by the MOHE (the “Initiative”). The salient terms of the letter of agreement are as follows:­(1) Microsoft (Malaysia) Sdn Bhd will make available English language versions of the Windows 7 starter edition software product and will invest an investment funds for each unit of such software product that the MOHE acquires for distribution to students, teachers and schools under the Initiative. The investment per unit will be available only in connection with the Windows Starter Edition PPP Stock Keeping Unit (“PPP SKU”) through Original Equipment Manufacturers (“OEMs”) or system builders authorised to distribute the PPP SKU in Malaysia.
(2) Microsoft (Malaysia) Sdn Bhd will pay the investment funds to LSB and such funds will be used solely for teacher training, student development activities and MOHE-endorsed initiatives connected to the Initiative. LSB agrees to act as the Initiative’s authorised agent to receive the investment funds and will ensure the investment funds are used for the benefit of the Initiative and in accordance with its own, the MOHE’s and Microsoft guidelines.
(3) The terms and conditions of the letter of agreement are confidential and will be treated by the parties with upmost regards to their confidential nature. LSB agrees not to disclose or release any information related to the Initiative, the investment funds, the actual or proposed amount of investment funds, or the administrative requirements related to the investment funds or any other related confidential information without the express written consent of Microsoft (Malaysia) Sdn Bhd.
(4) The letter of agreement will expire on 22 July 2011 or the date when the 150,000 units of the PPP SKUs are distributed and sold under the Initiative.

In compliance with item (3) above, we have obtained letters of consent from the Microsoft on 12 January 2011 and on 10 June 2011 for us to disclose the content of the letter of agreement in this Prospectus save and except for any information in relation to pricing as contained in the letter of agreement. [The Rest Of This Page Is Intentionally Left Blank] 4. INFORMATION ON OUR GROUP (Cont’d) (e) By a letter of agreement dated 25 August 2010 issued by Microsoft (Malaysia) Sdn Bhd to LSB, LSB has been appointed as a provider of ICT training to student under the Malaysian Broadband PC Initiative (“Initiative”) sponsored by the Ministry of Information Communications and Culture (“Ministry”). The salient terms of the letter of agreement are as follows:­(1) Microsoft (Malaysia) Sdn Bhd will make available English language versions of the Windows 7 starter software product, Live @ Edu, communication and collaboration services, Microsoft digital literacy curriculum, Microsoft learning suite and will invest an investment funds for each unit of such software product that the Ministry acquires for distribution to students under the Initiative. The investment per unit will be available only in connection with the PPP SKU (as described in item (a) above) through OEMs (as described in item (a) above) or system builders authorised to distribute the PPP SKU in Malaysia.
(2) Microsoft (Malaysia) Sdn Bhd will pay the investment funds to LSB and such funds will be used solely for the Microsoft training and support program connected to the Initiative. LSB agrees to act as the Initiative’s authorised agent to receive the investment funds and will ensure the investment funds are used for the benefit of the Initiative and in accordance with its own, the MOHE’s and Microsoft guidelines.
(3) The terms and conditions of the letter of agreement are confidential and will be treated by the parties with upmost regards to their confidential nature. LSB agrees not to disclose or release any information related to the Initiative, the investment funds, the actual or proposed amount of investment funds, or the administrative requirements related to the investment funds or any other related confidential information without the express written consent of Microsoft (Malaysia) Sdn Bhd.
(4) The letter of agreement will expire on 1 July 2011 or the date when the 123,000 units of the PPP SKUs are distributed and sold under the Initiative.

In compliance with item (3) above, we have obtained letters of consent from the Microsoft on 12 January 2011 and on 10 June 2011 for us to disclose the content of the letter of agreement in this Prospectus save and except for any information in relation to pricing as contained in the letter of agreement. [The Rest Of This Page Is Intentionally Left Blank] 4. INFORMATION ON OUR GROUP (Cont’d) (f) By a letter of award dated 14 July 2010 issued by the MOE to PSSB and by an agreement dated 18 January 2011 between the MOE and PSSB, PSSB has been appointed to supply and manage Microsoft licences for public schools and matriculation colleges in Malaysia under the EM Programme. The salient terms of the agreement are as follows:­(1) The agreement is effective for a period of one (1) year and eight (8) months commencing from 19 July 2010 to 18 March 2012. PSSB may apply to the MOE in writing for an extension of a contract period not less than three (3) months prior to the agreement expiry date.
(2) The agreement price is RM12 million.
(3) PSSB shall provide within 14 days after the receipt of the letter of award, a performance bond issued by an approved licensed bank or financial institution incorporated in Malaysia in favour of the MOE for a sum equivalent to 5% of the agreement price amounting to RM600,000 to secure the performance of the PSSB under the agreement by the PSSB and such performance bond shall remain valid until 12 months after the expiry of the agreement.
(4) PSSB shall not without written consent of the MOE sub-let the whole or any portion of the agreement nor shall it assign its right and obligations under the agreement to any party.
(5) In the event PSSB without reasonable cause:­
• suspend the performance of its obligations under the agreement and fails to proceed regularly and diligently with the performance of its obligations under the agreement; or
• fails to execute its obligations under the agreement in accordance with the agreement or persistently neglects to carry out its obligations under the agreement; or
• default in performing the duties under the agreement; or
• breaches any of its obligations or fails to comply with any other term and conditions of the agreement;

 

the MOE shall give notice in writing to PSSB specifying the default and requiring PSSB to remedy the default within 30 days or such longer period as the MOE may agree from the receipt of the default notice. If PSSB shall fail to remedy such default or shall at any time thereafter repeat such default whether previously repeated or not, then the MOE shall be entitled to forthwith terminate the agreement, without prejudice to any other rights or remedies it may possess against PSSB under any law or the agreement. [The Rest Of This Page Is Intentionally Left Blank] 4. INFORMATION ON OUR GROUP (Cont’d) (A) The agreement and all matters pertaining hereto shall be considered as confidential information.
(B) In the agreement, “Confidential Information” shall include all information and materials disclosed or made available to PSSB under the agreement; generated, collected or utilised by PSSB that relates to the Government, the MOE or any of its affairs; or resulting from any work performed by PSSB under the agreement, and includes all tools, templates, methodologies, know-how and information utilised by PSSB in the course of performing its services.
(C) Except with the prior written consent of the Government, both the Government and PSSB and their personnel, servants, agents or employees shall not at any time communicate to any person or body or entity, any Confidential Information disclosed to him for the purpose of the agreement.
(0) No advertisement in respect of the agreement shall be published in any newspaper, magazine or any other forms of advertisement without prior written approval from the Government.

(6) The agreement and all matters pertaining thereto shall be considered as confidential information and except with the prior written consent of MOE, both MOE and PSSB and their personnel, servants, agents or employees shall not at any time communicate to any person or body or entity, any confidential information disclosed to him for the purpose of the agreement. Further, no advertisement in respect of the agreement shall be published in any newspaper, magazine or any other forms of advertisement without prior written approval of MOE. PSSB has obtained a performance bonds from Bank Muamalat Malaysia Berhad in favour of MOHE on 26 July 2010. In compliance with (5) above, we have obtained letters of consent from MOE dated 20 May 2011 and 31 May 2011 for us to disclose the contents of the agreement in this Prospectus. [The Rest Of This Page Is Intentionally Left Blank] 4. INFORMATION ON OUR GROUP (Cont’d) (g) By a letter of award dated 13 May 2010 issued by the IRB to PSSB and by an agreement dated 5 August 2010 between IRB and PSSB, PSSB has been appointed to supply, renewal and delivery of Microsoft Licence, provide Microsoft premier Support and Microsoft IT Architecture & Planning, and training to the IRB (“Works”). The salient terms of the agreement are as follows:­(1) The duration of the Works shall be from 17 May 2010 to 28 February 2013.
(2) The agreement price is RM21,476,530.31.
(3) PSSB shall guarantee that the Microsoft software licences offered shall be available to the IRB at the terms and conditions stipulated in the agreement throughout the warranty period. The warranty period for the Microsoft licences shall be 36 months effective from 1 March 2010 to 28 February 2013 and the warranty period for the Microsoft Premier Support shall be 36 months effective from 01 March 2010 to 28 February 2013.
(4) PSSB shall not, without the written consent of the IRB first obtained, assign any rights or liabilities under the agreement or appoint any sub-contractor to carry out his duties and obligations.
(5) PSSB shall not, without authority of the IRB enter into any agreement on behalf of the IRB or bind or attempt to bind the IRB in agreement or otherwise.

[The Rest Of This Page Is Intentionally Left Blank] 4. INFORMATION ON OUR GROUP (Cont’d) (6) The IRB shall have right to terminate the agreement at any time thereafter by giving 14 days written notice to PSSB, if PSSB fails to remedy the following default within 30 days after the date of the IRB’s notice to PSSB requiring PSSB to remedy such default:­
• partially or wholly suspends, without reasonable cause, the supply and delivery, of the items before their respective date(s) of completion.
• fails to proceed with the works with reasonable diligence after the issue of purchase order(s).
• without reasonable cause wholly or partially fails to complete the delivery of the items after any extended period granted.
• commits a breach of any of the clauses or stipulation in this IRB agreement.
• becomes insolvent or enter into voluntary or compulsory liquidation or pass an effective winding up or make an arrangement or composition with its creditors; or if any receiver be appointed on behalf of the debenture holders or otherwise.
• fails to inform the IRB in respect of changes its shareholdings.
• execution is levied against a substantial portion of PSSB’s assets, unless it has instituted proceedings in good faith to set aside such execution.

 

(7) Except without the written consent of the IRB, PSSB shall not at any time communicate to any person or body or entity any confidential information disclosed to PSSB for the purpose of the provision of services or discovered by PSSB in the course of the provision and performance of services. Nor shall PSSB make public any information as to the recommendation, assessment and opinion formulated in the course or as a result of the provision and performance of services, nor shall PSSB or its personnel make any statement relating to the services without consent of the IRB.

In compliance with item (7) above, we have obtained letters of consent from the IRB dated 12 November 2010 and 8 June 2011 for us to disclose the content of the agreement in this Prospectus. (h) By a letter of award dated 13 November 2009 issued by the Government of Malaysia as represented by the MOHE to PSSB and the agreement dated 15 December 2009 between the MOHE and PSSB, PSSB has been appointed to supply Software & Services under “Pembekalan Perisian Autodesk Selari dengan Program Pentauliahan Professional Untuk Semua IPTA Politeknik dan Kolej Komuniti di bawah Kementerian Pengajian Tinggi Bagi Tahun 2009-2012” (“Works”). The agreement commences from 1 November 2009 continue for three (3) years ending 31 October 2012. PSSB has obtained a performance bonds from Bank Muamalat Malaysia Berhad in favour of the MOHE on 25 November 2009. The Performance Bond would remain valid from 1 November 2009 to 31 October 2013. 4. INFORMATION ON OUR GROUP (Cont’d) The salient terms of the agreement are as set out below:­(1) the MOHE shall purchase Autodesk products each year for all IPTAs for three
(3) years in accordance with the product list as set out in the agreement. The purchase shall be limited to a ceiling price of RM20 million.
(2) PSSB is not to assign its rights or transfer any of its liabilities under the agreement or any part thereof to any person without the MOHE’s prior written consent.
(3) PSSB shall procure a performance bond to be issued by a bank licensed under the Banking and Financial Institutions Act 1989 or Islamic banking Act 1984, and approved by the MOHE for 5% of the ceiling agreement price of the agreement amounting to RM1 million to guarantee the due performance of PSSB under the agreement and the performance bond shall be remained valid for 12 months after expiry of the agreement or upon termination of the agreement.
(4) If PSSB commits any of the following defaults:­
• PSSB commits a breach of any provision of the agreement, and if such breach is capable of remedy but is not remedied by PSSB within 14 days from the date the MOHE notifies PSSB to do so; or
• PSSB:­

 

Has a winding up order made against it; Becomes insolvent or compounds with or makes arrangements with its creditors; or goes into liquidation whether voluntarily (save for the purpose of permitted amalgamation or reconstruction) or compulsorily; or • Has a provisional liquidator, receiver or manager or receiver and manager appointed in respect of its business or undertaking or possession of its property is taken by or on behalf of creditors or debenture holders secured by a floating charge. Then MOHE may give notice in writing to PSSB specifying the default and if PSSB fails to remedy such default within 14 days after receipt of the said notice or shall at any time thereafter repeat such default, the MOHE shall be entitled, without prejudice to any other rights or remedies it may possess against PSSB, to forthwith terminate the agreement. (5) The agreement and all matters pertaining thereto shall be considered as confidential information and except with prior written consent of the MOHE, PSSB and its personnel shall not at any time communicate to any person except those employees, agents, sub-contractors and other suppliers on a need-to-know basis, make public any information or make or cause to be made any press statement or otherwise relating to the Agreement. In compliance with item five (5) above, we have obtained letters of consent from the MOHE dated 11 November 2010 and 8 June 2011 for us to disclose the contents of the agreement in this Prospectus. 4. INFORMATION ON OUR GROUP (Cont’d) (i) By a letter of award dated 3 July 2006 issued by the MOHE to PSSB and the agreement dated 14 November 2006 between the MOHE and PSSB, PSSB has been appointed to for the Supply of Software under “Kontrak Pembekalan Perisian Microsoft selari dengan 3P untuk semua IPTA, Politeknik dan Kolej Komuniti di bawah Kementerian Pengajian Tinggi” to the MOHE for a period of three (3) years with RM10 million per year. The agreement has expired on 2 July 2009. Subsequently by a letter of renewal dated 8 April 2009 and an Addendum to the agreement dated 15 April 2009 between the MOHE and PSSB, the agreement has been renewed for another two (2) years commencing from the expiry date of the agreement, namely 2 July 2009 to 1 July 2011 with the consideration of RM10 million per year. All terms and conditions in the agreement shall remain the same. The salient terms of the addendum are as set out below:­(1) PSSB shall not assign its rights or transfer any of its liabilities under the addendum or any part thereof to any person without the MOHE’s prior written consent.
(2) PSSB shall procure a performance bond to be issued by a bank licensed under the Banking and Financial Institutions Act 1989 and approved by the MOHE for a sum equivalent to 5% of the agreement price amounting to RM500,000 to guarantee the due performance of its obligations under the addendum.
(3) If PSSB commits any of the following defaults:­
• PSSB commits any breach of any provision of the addendum but is not remedied by PSSB within 14 days from the date the Government of Malaysia notifies PSSB to do so; or
• if PSSB has a winding up order against it, becomes insolvent or compounds with or makes arrangements with its creditors; or goes into liquidation whether voluntarily (save for the purpose of permitted amalgamation or reconstruction) or compulsorily; or
• has a provisional liquidator, receiver or manager or receiver and manager appointed in respect of its business or undertaking or possession of its property is taken by or on behalf of creditors or debenture holders secured by a floating charge,

 

Then the MOHE may give notice in writing to PSSB specifying the default and if PSSB shall fail to remedy such default within 14 days after receipt of the notice or shall at any time thereafter repeat such default, the Government of Malaysia shall be entitled, without prejudice to any other rights or remedies it may possess against PSSB, to terminate the Addendum. [The Rest Of This Page Is Intentionally Left Blank] 4. INFORMATION ON OUR GROUP (Cont’d) (4) Except prior written consent of the MOHE is obtained, PSSB and its personnel shall not at any time communicate to any person except those employees, agents, sub-contractors and other suppliers on a need-to-know basis, make public any information, make or cause to be made any press statement or otherwise relating to the Project. PSSB has obtained performance bonds from Bank Muamalat Malaysia Berhad in favour of the MOHE to secure the due performance of PSSB under the agreement and the addendum. In compliance with item (4) above, we have obtained letters of consent from MOHE dated 11 November 2010 and 8 June 2011 for us to disclose the contents of the agreement in this Prospectus. 4.3.14 Material Capital Expenditures And Divestments Description  FYE 2008 RM’OOO  FYE 2009 RM’OOO  FYE 2010 RM’OOO  1 January 2011 up to the LPD RM’OOO  Total RM’OOO  Capital Expenditure  41  – 84  42  167 Computer systems and equipment  Motor vehicles  496  – 1,523  343  2,362  Freehold buildings  – 1,166(aJ  – 1,793(aJ  2,959  Construction in progress  2,295{aj  – – 2,295  Others{bj  2  2,214  217  660  3,093  2,834  3,380  1,824  2,838  10,876  Capital Divestment  1  2  – – 3 Computer systems and equipment  Motor vehicles  387  – – – 387  Freehold buildings  – – – – – Construction in progress  – – – – – Others{bj  1  – — – 1  389  2  – 391
Notes:­(a) Strata shop office units held under the master title GRN 267134, Lot 44028, Mukim Dengkil, Daerah Sepang, Negeri Selangor which we use as our Head/Management Office. The construction of the strata shop office units was completed in FYE 2009 and we started to move in August 2009. We purchased additional strata shop office units under the same master title for RM1.79 million during the period from 1 January 2011 up to the LPD. Please refer to Section 8.1 of this Prospectus for further details on the strata shop office units.
(b) Includes office equipment, furniture and fittings and renovation.

4. INFORMATION ON OUR GROUP (Cont’d) During the past three (3) financial years FYEs 2008 to 2010 and up to the LPD, our Group’s total material capital expenditures amounted to approximately RM10.88 million, principally relating to the acquisition of the new strata shop office units at NeoCyber, Lingkaran Cyber Point Barat, Cyberjaya, and its related expenses such as renovation as well as furniture and fittings for these shop office units. During the same period, material capital divestments by our Group, mainly from the disposal of motor vehicles amounted to approximately RMO.39 million. The capital expenditures were undertaken locally. Our capital expenditures were financed by a combination of internally generated funds and bank borrowings as well as hire purchase financing. 4.3.15 Technology UsedlTo Be Used (i) Design, Formulation And Administration Of ICT Training And Certification Programmes With our in-house expertise, we are involved in the design, formulation and administration of ICT training and certification programmes to cater to different needs of technology users ranging from beginners to advanced specialists. The design of our ICT training and certification programmes involve the conceptualisation of various aspects such as establishing the goals and objectives, content development and delivery, content materials, structure, timeline, costs, competency and relevance of the certification programmes to the participants. The design phase of the overall ICT training and certification programme is depicted in the following diagram:­Formulating Localised Establishing Goals Contentand Objectives Content Delivery Content Materials
The preliminary stages in ICT training and certification programme design is the establishment of goals and objectives of the programme such as supporting Malaysia’s strategy towards becoming a knowledge intensive and innovation-led economy, and improving the level of skills and competency amongst graduates of higher learning institutions or participants. The identification of content materials for the ICT training and certification programmes include, amongst others, software programmes, textbooks and examination materials, that are relevant or in-line with current technologies and trends to meet industry needs. Formulation of localised content refers to the translation of foreign languages to the local language to enable local participants to better understand the course materials. Content delivery refers to the identification of certified instructors who are proficient and efficient with the certification courses, and training processes as a basis to form standard operating procedures to be used as guidelines for the instructors to carry out their tasks such as tracking, marking and publishing the results of the students. We have been involved in the design, formulation and administration of ICT training and certification  programmes  for  various  projects  including  the  BPPT  Programme,  the  3P  Programme,  the  RBTCS  Programme  and  “IC  CITIZEN”,  our  first  in-house training  and  certification programme.
4. INFORMATION ON OUR GROUP (Cont’d) Through our in-house R&D effort, PSSB has obtained the several statutory declarations for the copyrights in relation to our business operations in 2009 and 2010, as disclosed in Section 4.3.4 of this Prospectus. (ii) leT The knowledge and skills of ICT is required for our business operations specifically in the provision of ICT training and certification, as well as software licence distribution and management. ICT incorporates computing hardware, software, communications and services, while the relevant ICT knowledge and skills that apply to our business are closely linked to specific software, hardware and communications technologies. In general, software refers to the digitally stored data such as computer programmes and other types of information that can be read and written by computers. A computer programme is a sequence of instructions that are written to perform a specified task for a computer. A computer requires programmes to function, and typically executes the programme instructions in a central processor. Most programmes contain an executable form that the computer can use directly to execute the instructions, and a source code that can be read by humans. Hardware is commonly related to the physical computing related devices and is segmented into three major subsections:­• Processor hardware such as mainframes, mid-range computers, desktop computers, notebooks, server hardware and others;
• Input/output devices such as keyboards, scanners, desktop monitors, printers, speakers and others; and .
• Storage devices such as solid-state drives, optical disks and hard disks.

We apply ICT technology into our provision of ICT training and certification to impart the knowledge and skills to the participants including graduates, lecturers, and ICT users. In general, individuals who intend to build on basic IGT competencies usually would specialise in a particular ICT discipline such as development tools and programming language, data base systems, operating systems, and networking protocols and applications. We apply various ICT knowledge and skills into our training programmes with the aim to realise the range of benefits including training individuals to enter the ICT field as a new workforce, or to update and expand their skill sets, as well as prepare them for career advancement. 4.3.16 Research And Development (i) Policy On Research And Development Our R&D activities are mainly focused on process improvements on programme and procedure enhancement, as well as the development of new learning/training and certification programmes. Through the R&D activities listed above, we aim to realise the following benefits:­• Sustain and grow our business;
• Increase revenue and profitability; and
• Sustain our competitive advantages.

4. INFORMATION ON OUR GROUP (Cont’d) We are currently undertaking R&D work on our new learning/training and certification programmes and these are as follows:­• English language learning and certification for ICT related industries to meet the industry needs in terms of basic English language proficiency;
• Islamic finance training and certification involve the development of curriculum and procedures based on Islamic principles and practices; and
• Green IT certification is designed to enhance IT professional’s experience, knowledge and existing IT credentials to incorporate emerging technologies in shaping the global green IT industry today.

Our R&D processes are as follows:­
i l
Ecosystem Conceptual Framework Development & Training & Curriculum i  1  Localisation  Proposal & Partners  i  i
Build & Deployment  Technology Transfer & Development  “–­ Beta Testing Data Analysis  ~
We begin our R&D by going through a process of identifying various programmes that may be commercially attractive. Once we have identified a potential programme, we conduct market research on the proposed programme to identify potential customers’ needs and to ascertain commercial viability. Our market research involves various activities including the identification of course subjects and discussions with relevant authorities, stakeholders and related parties such as the MOHE. After identifying the course subjects, we will produce a framework depicting the course of actions to be taken to successfully launch the programme. The proposed actions include, among others, identifying various partners, technologies to be used, testing and data analysis framework, and delivery methods. The programme framework is then submitted to various partners that may be able to assist us in developing the programme. These partners would have the expertise in technology and product development, and commercialisation activities. 4. INFORMATION ON OUR GROUP (Cont’d) Under the technology transfer and development phase, we will send a project team to undergo a customised training workshop prepared by our partners to learn more about the technology or product developed by them. Upon completion of the customised training workshop, our project team will utilise the knowledge obtained to carry out product testing and data analysis to identify and rectify any weak points or issues relating to the technology or product. The build and deployment phase is carried out once all the issues and weaknesses of the technology or product have been rectified. The finalised technology or product is then produced, incorporating localised content to benefit local participants. Our next procedure involves the identification of course materials and training instructors. The instructors will attend a specialised workshop conducted by us to familiarise themselves with our programme and standard operating procedures. Finally, our programme is commercialised and delivered with the assistance of our partners. The names of the partners which we intend to work with and their contribution for the new learning/training and certification programmes we are currently working on are as set out below:­Programme  Partner  Contribution  English language learning and certification  Prometric Prometric/lnstitute of Islamic Banking & Finance International Islamic University Malaysia  Provide technical know-how assistance in developing the contents of the programmes. In addition, we can also leverage on the marketing and distribution channels of our partners to promote our programmes.  Islamic finance training and certification  Green IT certification  e2Readiness
Further details on our Group’s new learning/training and certification programmes are set out in Section 4.4.2 of this Prospectus. (ii) Research And Development Expenditure Our R&D expenditure for the past three (3) FYEs 2008 to 2010 is as follows:­FYE 2008  FYE 2009  FYE 2010  R&D Capital Expenses (RM’OOO) R&D Operating Expenses (RM’OOO) TOTAL R&D Expenses (RM’OOO) Total R&D Expenses As A Proportion Of Our Groups’s Total Revenue (%)  nfa nfa nfa nfa  244 -244 0.62  1,141 40 1,181 2.02
Note:­nla Not available as our Group did not capitalise R&D expenses incurred nor maintain a separate expense account for our R&D activities for FYE 2008. 4. INFORMATION ON OUR GROUP (Cont’d) 4.4 FUTURE PLANS AND STRATEGIES Our future plans are focused in four (4) key areas as depicted in the figure below:­

 

ICT Islamic Finance Multimedia
Training and Certification Architecture. Engineering and
Green IT Construction (AEC)
4.4.1 New And Upgrade Of Training Programmes And Certifications Our technology and software vendor partners are constantly improving and upgrading existing training programmes and certifications, as well as introducing new training programmes and certifications. As such, our future plans will also incorporate a continuous process of introducing new and upgrading existing training programmes and certifications. This will ensure that we keep up with technological and software advances, especially in tandem with our technology and software vendor partners. Areas that we will cover include the following:­• ICT, which currently constitutes the majority of our training programmes and certifications;
• Multimedia, which we envisage will grow in importance and thus we will aim to increase our offerings in this area; and
• AEC, which is closely related to our suite of AutoCAD training and certification, will continue to be enhanced to ensure relevance as well as to enlarge our customer base.

4. INFORMATION ON OUR GROUP (Cont’d) 4.4.2 New Certification Programmes Our business currently focuses on professional ICT training and certification, and software licence distribution and management. We plan to expand our services and capabilities to provide the following new certification programmes:­• English language learning and certification;
• Islamic finance training and certification; and
• Green IT.

(i) English Language Learning And Certification We recognise the importance of English language as the most common form of communication in the use, application and advancement of ICT in general and the Internet in particular. As part of our future plans, we plan to develop and introduce English language learning and certification, targeting ICT related industries. English is a common communication tool used within the industry. As such, English language proficiency is important for graduates and professionals to meet industry requirements. We plan to utilise our existing capabilities in developing curriculum and assessment procedures for our new language learning programme taking into consideration the following factors:­• Type of courses including general and basic instructor-led English courses, as well as computer based English courses; and
• Focusing on five (5) main areas:­listening reading speaking grammar writing language workbooks and materials conversation and interpersonal skills

 

We plan to introduce this English language learning and certification programme by the second half of 2011. (ii) Islamic Finance Training And Certification There is a growing need for Islamic finance in Malaysia as well as overseas, particularly in the Middle East and other Islamic countries. We intend to develop and introduce Islamic finance training and certification to address new areas for business growth. The proposed development of this training programme and certification will be focused on technical and product oriented training courses. We aim to provide courses to increase awareness and understanding of the principles and use of Shariah compliant products that meet the requirements of the Islamic law. Some of the areas we intend to incorporate into our training programme and certification include capital markets, Islamic funds, and other related finance products and fields. In line with our Government’s initiatives, we will place emphasis on skill training in human capital development to meet industry requirements as well as to drive productivity improvements. 4. INFORMATION ON OUR GROUP (Cont’d) We intend to deliver the Islamic finance training and certification programme with the collaboration of our identified partners and their respective roles are as set out below:­(a) Institute of Islamic Banking & Finance International Islamic University Malaysia -to be the subject matter experts in conducting needs analysis, developing the body of knowledge and career roadmap through the Islamic finance certification; and
(b) Prometric -to assist in marketing promotion and distribution activities as well as in developing and validating training modules.

We plan to launch the Islamic finance training and certification programme by the first half of 2012. (iii) Green IT Green IT certification is designed to enhance an IT professional’s experience, knowledge, and existing IT credentials to incorporate emerging technologies in shaping the global green IT industry today. IT professionals that pass the Green IT examination would serve to validate that they have the aptitude needed to effectively implement and measure green IT programmes and investments, including:­• A specialised knowledge of current IT methodologies;
• The ability to develop, deploy and calculate true return on investment for green IT initiatives;
• Knowledge of cost-cutting power management and IT virtualisation techniques;
• Proven understanding of environmentally-sound waste disposal;
• An awareness of global organisations mandating standards and regulations.

The Green IT certificate is ideal for IT professionals who have decision making authority over a company’s IT infrastructure or work in implementing green IT initiatives. Such professionals would include IT manager, data centre or facilities/operations manager, IT technician, and system or network administrator. We plan to launch the Green IT certification programme in the second half of 2011. 4.4.3 Geographical Expansion (i) Establish Training And Certification Business In The Middle East Region Our existing provision of ICT training and certification operations is located in Malaysia. We intend to leverage on our core competency in ICT training and certification to expand our business to the Middle East region to provide ICT training and certification, and Islamic finance training and certification. We believe we have an advantage in expanding into the Middle East region as Malaysia is regarded as relatively advance in ICT and Islamic finance compared to some of the Middle East countries. Our new business in the Middle East region will provide us with opportunities for business growth, as well as to diversify any over-dependency in Malaysia. Our expansion in the Middle East region will be undertaken via a partnership arrangement. Based on the recent political unrest in the Middle East including Syria, Yemen, Jordan, Algeria, Bahrain, Iraq and Palestine Territories, in addition to those in the neighbouring North African countries namely Libya and Egypt, we will continue to evaluate and review the market and political situation on an on-going basis. We are currently focusing our expansion plans on Saudi Arabia and United Arab Emirates. 4. INFORMATION ON OUR GROUP (Cont’d) At this stage, we have started working on the translation of our “IC CITIZEN” certification programme into Arabic to service this part of the market. We plan to commence our expansion into the Middle East region by the second half of 2011. (ii) Establish Regional Sales Offices And Training Centres We are authorised to provide ICT training and certification in any location in Malaysia. This enables us to have the flexibility to expand our business operations and services within Malaysia. As part of our expansion plans, we intend to establish sales offices and training centres in Penang, Johor and Sarawak. Furthermore, this will enable us to work and interact closely with our customers as well as participants and users to serve them better. We plan to establish our sales offices and training centres in Penang, Johor and Sarawak by the second half of 2011. 4.4.4 New Business Venture Develop Proprietary Test And Assessment Centres We are currently an authorised provider of test and assessment centre to conduct examinations for professional certification. We are authorised by the Prometric Premier Test Center and Pearson Vue Authorised Test Centre. Part of our future plans includes developing our own proprietary test and assessment centres of which we will develop a set of in-house proprietary procedures and systems including preparation of examination, examination monitoring and supervising which meet the necessary requirements and standards of our software vendors and organisations. Upon the successful launch of our proprietary test and assessment centre, we can utilise our existing training centre in Cyberjaya, our future training centres in Penang, Johor and Sarawak and/or third parties’ training centres such as those owned by INTAN or public higher learning institutions to conduct examinations for courses such as those offered under the 3P Programme and/or our in-house developed certification programmes such as the IC Citizen Programme. In addition, we may also authorise third parties who can adopt our proprietary procedures and systems and meet our requirements and standards to conduct examinations. We plan to launch our proprietary test and assessment centres by the first half of 2012. [The Rest Of This Page Is Intentionally Left Blank] 4. INFORMATION ON OUR GROUP (Cont’d) 4.4.5 Milestones The following table indicates the timing for implementing our future plans:­
ICT  On-going  Multimedia  On-going  Architecture, Engineering and Construction (AEC)  On-going

Islamic finance training and certification Green IT
4.5 OUR GROUP’S FUTURE PROSPECTS The prospects of our Group are favourable in light of the following factors:­• Our good business performance as a platform for future growth and success;
• Our competitive advantages to win market share and to grow our business;
• Our future plans to provide sustainable growth; and
• The favourable industry outlook to proVide us with growth opportunities.

(i) Good Business Performance Our good business performance is supported by the following financial achievements between FYE 2006 and FYE 2010:­(a) Our PBT increased from RM5.42 million for FYE 2006 to RM15.15 million for FYE 2010. This represented a compounded annual growth rate of 29.31 % per annum between FYE 2006 and FYE 2010.
(b) Our PBT margin grew from 8.48% for FYE 2006 to 25.88% for FYE 2010.

Our relatively high PBT margin and the continuing growth of our financial performance over the last five (5) years will provide us with the platform for continuing business success and growth. 4. INFORMATION ON OUR GROUP (Cont’d) (ii) Competitive Advantages Our competitive advantages will provide a platform for continuing growth and success. This includes the following:­(a) Our track record and established reputation since commencement of our business in 2003 and reinforced by the following achievements:­
• Between 2004 and 2007, we have provided ICT literacy training to approximately 100,000 teachers from local public schools under the BPPT Programme. .
• As at the LPD, approximately 18,790 participants have participated in our training and certification programme since 2006 under the 3P Programme.
• As at the LPD, we have provided ICT literacy training to approximately 1,660 civil servants since 2009 under the RBTCS Programme.
• As at the LPD, we managed and distributed approximately 878,621 Microsoft licences and 15,410 Autodesk licences to various Government bodies in Malaysia since 2006.

 

(b) Our high value contracts where each contract enables us to service a large group of individuals or organisations. This enables us to grow our business substantially while optimising our management, administrative, sales and marketing efforts.
(c) We have medium to long-term contracts that will help us secure continuous revenue streams and provide some assurance of business continuity for the duration of the contracts.
(d) We have Government contracts, which provide us with several keyadvantages:­
• the aggregate value of each contract is relatively higher to contracts with the private sector; and
• some assurance of a continuous revenue stream and less risk of non­payment during the duration of these contracts.

 

(e) We enjoy economies of scale through the large number of individuals that we train and certify, and the large number of software licences that we distribute and manage.
(f) We have “IC CITIZEN”, an in-house developed training and certification programme that provides us with the following benefits:­
• able to resell our proprietary programme without constraints;
• able to appoint resellers to expand our global coverage;
• able to customise our programme;
• able to enhance our programme to keep abreast of changing needs of customers and environment as well as technologies; and
• not reliant on third party principals.

 

(g) Potential global markets for our proprietary “IC CITIZEN” training and certification programme.

[The Rest Of This Page Is Intentionally Left Blank] 4. INFORMATION ON OUR GROUP (Cont’d) (iii) Future Plans To Provide Sustainable Growth We have in place a sound business plan for moving forward, and are focused in the following area:­(a) New and upgraded titles of certification including ICT, Multimedia and Architecture Engineering and Construction (AEC).
(b) New certification programmes including English language learning and certification for the ICT industry, Islamic finance training and certification, and Green IT to address new markets for business growth.
(c) Geographic expansion into the Middle East region for the provision of ICT training and certification, and the establishment of regional sales offices and training centres in Malaysia.
(d) New business venture to develop proprietary test and assessment centres.

Our future plans would provide us with the platform to grow and sustain our business. (iv) Favourable Industry Outlook The outlook for the ICT Services Industry including the provision of professional ICT training and certification, and distribution of proprietary software licences in Malaysia is favourable. This is substantiated by the following.:­• Favourable economic conditions;
• Stimulus from the 2011 Budget;
• Increasing expenditure on public education;
• Growth in public education institutions and student enrolment;
• Growth provided by the 10th Malaysia Plan; and
• Positive impact of the Economic Transformation Programme.

(Source: Independent Assessment of the ICT Services Industry Focusing on Professional ICT Training and Certification, and Distribution of Proprietary Software Licences in Malaysia prepared by Vital Factor) The favourable industry outlook would provide growth opportunities for our business. Please refer to the Independent Market Research Report as disclosed in Section 11 of this prospectus for the overview of the industry in which our Group operates. [The Rest Of This Page Is Intentionally Left Blank]

 

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