MALAYSIAN AE MODELS HOLDINGS BERHAD (MAE OR THE COMPANY) (I) (II) PROPOSED RIGHTS ISSUE; AND PROPOSED EXEMPTION

(COLLECTIVELY REFERRED TO AS THE PROPOSALS) 1. INTRODUCTION On behalf of the Board of Directors of MAE (Board), OSK Investment Bank Berhad (OSK) wishes to announce that the Company proposes to undertake the following:(i) a renounceable two-call rights issue of up to 53,503,434 new ordinary shares of RM1.00 each in MAE (Rights Share(s)) together with up to 53,503,434 free detachable warrants (Warrant(s)) at an issue price of RM1.00 per Rights Share, on the basis of one (1) Rights Share with one (1) free Warrant for every two (2) existing ordinary shares of RM1.00 each held in MAE (MAE Share(s) or Share(s)) at an entitlement date to be determined later (Entitlement Date), of which the first call of RM0.50 (First Call) will be payable in cash on application and the second call of RM0.50 (Second Call) is to be capitalised from the Companys reserves (Proposed Rights Issue); and an exemption for Aemnic Corporation (M) Sdn Bhd (Aemnic), Datuk Dr Lim Kee Sinn (Datuk Dr Lim) and persons acting in concert with them (PAC(s)), under Practice Note 9 (PN9), Paragraph 16.1 of the Malaysian Code on Take-Overs and Mergers, 2010 (Code) from the obligation to undertake a mandatory general offer (MGO) for all the remaining MAE Shares not already owned by them pursuant to their subscription of the Rights Shares in relation to the Proposed Rights Issue (Proposed Exemption).

(ii)

Further details on the Proposals are set out in the ensuing sections of this announcement.

2.

DETAILS OF THE PROPOSALS 2.1 Proposed Rights Issue 2.1.1 Details of the Proposed Rights Issue The proposed rights issue entails a renounceable issue of up to 53,503,434 Rights Shares together with up to 53,503,434 free Warrants at an issue price of RM1.00 per Rights Share to be payable in two-calls, on a renounceable basis of (1) Rights Share with one (1) free Warrant for every two (2) existing MAE Shares held. The Proposed Rights Issue will be implemented on a minimum subscription basis to raise a minimum gross proceeds of approximately RM10.36 million. The minimum subscription basis has been determined by the Board after taking into consideration, amongst others, the shareholding position of the substantial shareholders of MAE, the Groups gearing position and the minimum level of funds that the Company wishes to raise from the Proposed Rights Issue. Under the minimum subscription basis, the Proposed Rights Issue would entail the issuance of 20,724,619 Rights Shares and 20,724,619 free Warrants, whereby only the substantial shareholders of MAE (excluding Lembaga Tabung Haji) will subscribe for their Rights Shares entitlements (Minimum Subscription Basis).

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MALAYSIAN AE MODELS HOLDINGS BERHAD PROPOSALS

The Rights Shares will be provisionally allotted to the shareholders of MAE whose names appear in the Record of Depositors of the Company (Entitled Shareholder(s)) on the Entitlement Date after obtaining all the relevant approvals in respects of the Proposals. The free Warrants shall only be issued to the Entitled Shareholders of the Company, who subscribe for the Rights Shares pursuant to the Proposed Rights Issue. Although the Rights Shares with free Warrants are renounceable in full or in part, the Rights Shares and the Warrants are not separately renounceable. Accordingly, the Entitled Shareholders can only renounce or subscribe for their entitlements to the Rights Shares with free Warrants in full or in part in the proportion allocated. The Entitled Shareholders, who renounce their entitlements to the Rights Shares, partially or in full, will not be entitled to the Warrants attached to the Rights Shares renounced. The free Warrants will be detached from the Rights Shares immediately upon issuance and be traded separately on the Main Market of Bursa Malaysia Securities Berhad (Bursa Securities). Fractional entitlements of the Rights Shares and free Warrants arising from the Proposed Rights Issue shall be dealt with in a fair and equitable manner and terms as the Board in its absolute discretion deem fit and expedient in order to minimise the incidence of odd lots and in the best interest of the Company. 2.1.2 First Call and capitalisation of reserves The issue price of RM1.00 per Rights Share will be payable in two (2) calls comprising the First Call of RM0.50 per Rights Share to be payable in cash on application, and the Second Call of RM0.50 per Rights Share to be payable via capitalisation of the Companys reserves. Therefore, the subscribing shareholders will not have to make any further cash payment after the First Call of RM0.50 per Rights Share. For illustrative purposes only, the effects of the Proposed Rights Issue shall be based on the following two (2) scenarios:Minimum Scenario : Assuming only the substantial shareholders of MAE (excluding Lembaga Tabung Haji), being Aemnic, Datuk Dr Lim and Dato Sri Koh Kin Lip (Dato Sri Koh), subscribes in full for their Rights Shares entitlements based on the Minimum Subscription Basis. Assuming all the Entitled Shareholders subscribes in full for their respective Rights Shares entitlements.

Maximum Scenario

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MALAYSIAN AE MODELS HOLDINGS BERHAD PROPOSALS

Based on the audited consolidated financial statements for the financial year ended (FYE) 31 May 2011:Minimum Scenario Share premium (RM) 3,064 (3,064) Retained earnings (RM) 35,133 (7,298) 27,835 Total (RM) 38,197 (10,362) 27,835 Maximum Scenario Share premium (RM) 3,064 (3,064) Retained earnings (RM) 35,133 (17,661) 17,472 Total (RM) 38,197 (20,725) 17,472

Company level As at 31 May 2011 Less: Capitalisation for the Second Call under the Proposed Rights Issue After the Proposed Rights Issue

Based on the unaudited consolidated financial statements for the six (6)month financial period ended (FPE) 30 November 2011 of MAE:Minimum Scenario Share premiu m (RM) 3,064 (3,064) Retained earnings (RM) 34,841 (7,298) 27,543 Maximum Scenario Share premium (RM) 3,064 (3,064) Retained earnings (RM) 34,841 (17,661) 17,180

Company level As at 30 November 2011 Less: Capitalisation for the Second Call under the Proposed Rights Issue After the Proposed Rights Issue

Total (RM) 37,905 (10,362) 27,543

Total (RM) 37,905 (20,725) 17,180

The Board confirms that based on the latest audited consolidated financial statements for the FYE 31 May 2011 and the unaudited consolidated financial statements for the six (6)-month FPE 30 November 2011, the reserves required for capitalisation of the Proposed Rights Issue are adequate and unimpaired by losses on a consolidated basis in accordance with paragraph 6.30(1) of the Main Market Listing Requirements of Bursa Securities (Listing Requirements). Further, pursuant to Section 6.30(3) of the Listing Requirements, the Board will obtain a confirmation from the external auditors/reporting accountants on the adequacy of reserves to cover the capitalisation for the Second Call of the Proposed Rights Issue, details of which will be disclosed in the circular to shareholders to be issued in due course. The reserves available to be capitalised for the Second Call of the Proposed Rights Issue are unimpaired by losses on a consolidated basis.

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MALAYSIAN AE MODELS HOLDINGS BERHAD PROPOSALS

2.1.3

Basis of determining the issue price of the Rights Shares and the exercise price of the Warrants The issue price of RM1.00 per Rights Share was arrived at after taking into consideration the par value of MAE Shares of RM1.00 each. The First Call of RM0.50 for each Rights Share represents a discount of approximately 2.00% or RM0.01 to the theoretical ex-rights price of RM0.51 based on the five (5)-day VWAP of MAE Shares up to and including 1 March 2012, being the last market day prior to the date of this announcement of RM0.52. The Board is of the opinion that the said discount coupled with the Second Call capitalised from the reserves of the Company, acts as an incentive for all shareholders to subscribe for the Rights Shares. The exercise price of the free Warrants is fixed at RM1.00 per MAE Share, after taking into account the par value of MAE Shares. The issue price of the Rights Shares and the exercise price of the Warrants were determined after taking into consideration, amongst others, the par value of MAE Shares, the prevailing market conditions and the historical share price movement of MAE Shares.

2.1.4

Ranking of the Rights Shares and new MAE Shares arising from the exercise of the Warrants All the Rights Shares will, upon the allotment and issue, rank pari passu in all respects with the existing issued and paid-up ordinary shares of MAE, except that they will not be entitled to any dividends, rights, allotment and/or other distributions that may be declared, made or paid prior to the allotment and issue of the Rights Shares. All the new MAE Shares to be issued arising from the exercise of the Warrants will, upon the allotment and issue, rank pari passu in all respects with the existing issued and paid-up ordinary shares of MAE, except that they will not be entitled to any dividends, rights, allotment and/or other distributions that may be declared, made or paid prior to the allotment and issue of the new MAE Shares arising from the exercise of the Warrants.

2.1.5

Listing and quotation An application will be made to Bursa Securities for the admission of the Warrants to the Official List of Bursa Securities and the listing of and quotation for the Rights Shares and Warrants and the new MAE Shares to be issued following the exercise of the Warrants, on the Main Market of Bursa Securities.

2.1.6

Indicative salient terms of the Warrants The indicative salient terms of the free Warrants are set out below:Issue size : Up to 53,503,434 free Warrants to be issued in conjunction with the Proposed Rights Issue to the Entitled Shareholders on the basis of one (1) free Warrant for every one (1) Rights Share successfully subscribed

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Form

The free Warrants, which are issued with the Rights Shares, will be immediately detached upon issuance and will be separately traded. The Warrants will be issued in registered form and constituted by a deed poll to be executed by the Company (Deed Poll) Each Warrant carries the entitlement, at any time during the Exercise Period to subscribe for one (1) new MAE Share at the Exercise Price, subject to the adjustments in accordance with the provisions of the Deed Poll The Warrants may be exercised at any time after the second (2nd) anniversary of the date of th issuance and ending at 5.00 p.m. on the fifth (5 ) anniversary of the date of issuance, or if such day is not a market day, then it shall be the market day immediately preceding the said nonmarket day. Any Warrants not exercised during the exercise period will thereafter lapse and cease to be valid The exercise price of the Warrants is RM1.00 per new MAE Share, being the par value of MAE Shares The registered holder of the Warrant is required to lodge an exercise form, as set out in the Deed Poll, with the Companys share registrar, duly completed, signed and stamped together with payment of the Exercise Price by bankers draft or cashiers order drawn on a bank operating in Malaysia or a money order or postal order issued by a post office in Malaysia For the purposes of trading on Bursa Securities, one (1) board lot of Warrants shall comprise of 100 Warrants carrying the rights to subscribe for 100 new MAE Shares at any time during the Exercise Period, or such denomination as determined by Bursa Securities An application will be made to Bursa Securities for the admission of the Warrants to the Official List of Bursa Securities, and for the listing of and quotation for the Warrants and new MAE Shares arising from the exercise of the Warrants The new MAE Shares to be issued arising from the exercise of the Warrants shall, upon allotment and issue, rank pari passu in all respects with the existing MAE Shares, save and except that the new MAE Shares will not be entitled to any dividend, right, allotment and/or other forms of distribution where the entitlement date precedes the relevant date of allotment and issuance of the new MAE Shares

Exercise Rights

Exercise Period

Exercise Price

Mode of exercise

Board lot

Listing status of the Warrants

Ranking of the new MAE Shares

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MALAYSIAN AE MODELS HOLDINGS BERHAD PROPOSALS

Rights in the event of winding-up, liquidation, compromise and/or arrangement

Where a resolution has been passed for a members voluntary winding-up of the Company, or where there is a compromise or arrangement, whether or not for the purpose of or in connection with a scheme for the reconstruction of the Company or the amalgamation of the Company with one (1) or more companies, then every holder of the Warrants shall be entitled upon and subject to the provisions of the Deed Poll at any time within six (6) weeks after the passing of such resolution for a members voluntary winding-up of the Company or within six (6) weeks after the granting of the court order approving the compromise or arrangement, by the irrevocable surrender of his/her Warrants to the Company, elect to be treated as if he/she had immediately prior to the commencement of such winding-up, compromise or arrangement, exercised the Exercise Rights represented by such Warrants to the extent specified in the relevant exercise forms and be entitled to receive out of the assets of the Company which would be available in liquidation as if he/she had on such date been the holder of the new MAE Shares to which he/she would have been entitled to pursuant to such exercise The holder of the Warrants is not entitled to any voting right or participation in any forms of distribution and/or offer of further securities in the Company until and unless such holder of the Warrants exercise his/her Warrants for new MAE Shares during the Exercise Period The Exercise Price and/or number of unexercised Warrants shall be adjusted in the event of alteration to the share capital of the Company, capital distribution or issue of shares in accordance with the provisions of the Deed Poll The Warrants will be constituted by a Deed Poll to be executed by the Company Laws and Regulations of Malaysia

Rights of Warrants

the

Adjustments in the Exercise Price and/or number of Warrants

Deed Poll

Governing law 2.1.7

Irrevocable undertakings by the substantial shareholders of MAE The substantial shareholders of MAE (save for Lembaga Tabung Haji), being Aemnic, Datuk Dr Lim and Dato Sri Koh will provide their irrevocable undertakings to subscribe in full for their respective Rights Shares entitlements pursuant to the Proposed Rights Issue (Undertaking(s)), details of which are set out below:-

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MALAYSIAN AE MODELS HOLDINGS BERHAD PROPOSALS

As at 17 February 2012 Direct Indirect Substantial Shareholders Aemnic Datuk Dr Lim Dato Sri Koh Total No. of Shares 30,957,890 1,711,348 8,780,000 41,449,238 No. of Shares 30,957,890 20,000 30,977,890

% 28.93 1.60 8.21 38.74

% 28.93 0.02 28.95

No. of Rights Shares to be subscribed pursuant to the irrevocable undertaking 15,478,945 855,674 4,390,000 20,724,619

The abovementioned substantial shareholders will give their irrevocable undertakings to subscribe in full for their respective Rights Shares entitlements in order to meet the Minimum Subscription Basis. Details of the implication of the Code which may arise as a result of the Undertakings are set out in Section 2.2 of this announcement. 2.1.8 Underwriting arrangement As the Proposed Rights Issue is structured on a Minimum Subscription Basis, no underwriting arrangement will be made for the remaining balance of the Rights Shares not subscribed. 2.1.9 Utilisation of proceeds Based on the First Call of RM0.50 per Right Share, the Proposed Rights Issue is expected to raise gross proceeds of up to RM26.75 million. The details of the intended utilisation of proceeds under both the Minimum and Maximum Scenario are as follows:Proceeds to be raised Minimum Scenario Utilisation of proceeds Repayment of bank borrowings Working capital purposes
(2) (1)

Maximum Scenario RM000 24,000 1,752 1,000 26,752

Expected timeframe for the utilisation of proceeds RM000 Within one (1) month Within one (1) year Within one (1) month

RM000 7,610 1,752 1,000 10,362

Estimated expenses pursuant to (3) the Proposals Total

Notes:(1) The total borrowings of the Group as at 31 May 2011 is approximately RM368.23 million. The Group intends to use part of the proceeds raised from the Proposed Rights Issue to pare down some of its existing bank borrowings (including interest payable) of approximately RM7.6 million and RM24.0 million under the Minimum and Maximum Scenario, respectively. Based on the average prevailing interest rate incurred by the Group of 5.74% per annum, such repayment is expected to result in interest savings of approximately RM0.44 million and RM1.38 million per annum under the Minimum and Maximum Scenario respectively. Working capital includes expenditure for daily operations such as payment of salaries and operating expenses.

(2)

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MALAYSIAN AE MODELS HOLDINGS BERHAD PROPOSALS

(3)

If the actual expenses are higher than budgeted, the deficit will be funded out of the portion allocated for working capital. Conversely, if the actual expenses are lower than budgeted, the excess will be utilised for working capital purposes.

The proceeds to be raised from the exercise of the Warrants are dependent on the total number of Warrants to be exercised during the tenure of the Warrants. The proceeds from the exercise of the Warrants will be received on an as and when basis over the Exercise Period of the Warrants. Based on the exercise price of RM1.00 per Warrant, the Company will raise gross proceeds of up to RM53.50 million assuming full exercise of the Warrants. Any proceeds arising from the exercise of the Warrants in the future shall be utilised for working capital of the MAE Group. 2.2 Proposed Exemption As at 17 February 2012, Aemnic and Datuk Dr Lim, the substantial shareholders of MAE, directly hold 32,669,238 MAE Shares representing 30.53% equity interest in MAE, collectively. Pursuant to the Minimum Subscription Basis and the Undertakings, the shareholdings of Aemnic and Datuk Dr Lim in MAE will collectively increase to more than 33%, after the Proposed Rights Issue. The maximum potential shareholdings of Aemnic and Datuk Dr Lim after the Proposed Rights Issue based on the Minimum Scenario and Maximum Scenario are set out below:(a) (b) Undertaking to subscribe for Rights Shares entitlement No. of Shares % 28.93 1.60 30.53 15,478,945 855,674 16,334,619 (a) + (b) Maximum potential shareholdings in MAE after the Proposed Rights Issue Minimum Scenario No. of Shares 46,436,835 2,567,022 49,003,857 % 36.36 2.01 38.37 Maximum Scenario No. of Shares 46,436,835 2,567,022 49,003,857 % 28.93 1.60 30.53

Direct shareholdings as at 17 January 2012 Substantial Shareholders No. of Shares 30,957,890 1,711,348 32,669,238

Aemnic Datuk Dr Lim Total

Based on share capital of (No. of ordinary shares)

107,006,868

127,731,487

160,510,302

As illustrated above, Aemnic and Datuk Dr Lim will potentially increase its shareholdings in MAE from 30.53% to 38.37% under the Minimum Scenario. Pursuant to Part III of the Code, Aemnic, Datuk Dr Lim and the PACs would be obliged to extend a MGO to acquire the remaining MAE Shares not already held by Aemnic, Datuk Dr Lim and the PACs upon completion of the Proposed Rights Issue. As it is not the intention of Aemnic, Datuk Dr Lim and the PACs to undertake a MGO for the remaining MAE Shares not already held by Aemnic, Datuk Dr Lim and the PACs as a result of its Undertakings as mentioned above, an exemption from the SC from the obligation to undertake a MGO pursuant to Paragraph 16.1 of Practice Note 9 of the Code will be sought. In the event Aemnic, Datuk Dr Lim does not succeed in obtaining the approval for the Proposed Exemption, the Proposed Rights Issue will not be implemented. Hence, the Proposed Exemption and Proposed Rights Issue are inter-conditional.

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3.

RATIONALE AND JUSTIFICATION FOR THE PROPOSALS 3.1 Proposed Rights Issue The Proposed Rights Issue will enable the Company to raise immediate gross proceeds for repayment of bank borrowings, working capital requirements and defraying of expenses incidental to the Proposals. Moreover, if and when the Warrants are exercised, such funds will be used to finance the MAE Groups working capital such as the Groups operating and administrative expenses and further strengthen the capitalisation of the Company as well as improve the liquidity of the MAE Shares. After due consideration of the various fund raising options available, the Board is of the opinion that the Proposed Rights Issue is currently the most appropriate option due to the following:(i) the Proposed Rights Issue will enable the Company to raise funds to repay bank borrowings and to reduce the gearing level of the MAE Group. It is the Companys intention to gradually reduce its reliance on the bank borrowings thus reducing interest costs; the Proposed Rights Issue will involve the issuance of new MAE Shares without diluting the existing shareholders equity interest, assuming all the shareholders fully subscribe for their respective entitlements; the Proposed Rights Issue will provide an opportunity for the existing shareholders to further participate in the equity of the Company and the prospects and future growth of the Group; the Warrants, which are attached to the Rights Shares, are intended to provide incentive to the shareholders to subscribe for their entitlements, hence, providing them with the potential capital appreciation arising from the exercise of the Warrants, depending on the future performance of MAE Shares; and the Warrants attached to the Rights Shares will enable the Company to raise further proceeds from the equity market as and when any of the Warrants are exercised while at the same time provide the shareholders of MAE with the opportunity to increase their equity participation in the Company at a predetermined price over the tenure of the Warrants.

(ii)

(iii)

(iv)

(v)

3.2

Proposed Exemption As set out in Section 2.2 above, the Undertakings may result in Aemnic, Datuk Dr Lim and the PACs having to undertake a MGO under the Code for the remaining MAE Shares not already held by Aemnic, Datuk Dr Lim and the PACs after the Proposed Rights Issue. The Proposed Exemption will ensure the successful completion of the Proposed Rights Issue and together with the Undertakings, acquire the financial support from Aemnic, a major shareholder in MAE, for the Proposed Rights Issue.

4.

EFFECTS OF THE PROPOSALS The Proposed Exemption is not expected to have any effect on the share capital, substantial shareholders shareholdings, net assets (NA), gearing, earnings, earnings per Share (EPS) and dividend of MAE.

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For illustration purposes, the effects of the Proposed Rights Issue on MAEs share capital, NA, gearing, earnings, EPS, dividend, substantial shareholders shareholdings and existing convertible securities shall be based on the Minimum and Maximum Scenario. 4.1 Issued and paid-up share capital The effects of the Proposed Rights Issue on the issued and paid-up share capital of MAE are as follows:Minimum Scenario No. of Shares RM 107,006,868 107,006,868 Maximum Scenario No. of Shares RM 107,006,868 107,006,868

Share capital Existing as at 17 February 2012 To be issued pursuant to the Proposed Rights Issue

20,724,619

20,724,619

53,503,434

53,503,434

127,731,487 To be issued assuming full exercise of Warrants Enlarged issued and paid-up share capital 20,724,619

127,731,487 20,724,619

160,510,302 53,503,434

160,510,302 53,503,434

148,456,106

148,456,106

214,013,736

214,013,736

4.2

NA and gearing Based on the audited consolidated balance sheet of MAE for the FYE 31 May 2011, the proforma effects of the Proposed Rights Issue on the consolidated NA and gearing of the MAE Group are as follows:Minimum Scenario
Proforma I Audited as at 31 May 2011 RM 107,006,868 3,064,390 505,528 122,418,981 232,995,767 7,723 233,003,490 107,006,868 2.18 368,225,239
(6) (4) (1) (3) (2)

Proforma II Assuming full exercise of Warrants RM 148,456,106

(5)

Minimum Scenario Share capital Share premium Other reserves Warrants reserve Retained earnings Shareholders equity / NA Minority interests Total equity No. of MAE Shares NA per MAE Share (RM) Borrowings (RM) Gearing (times)

After the Proposed Rights Issue RM 127,731,487

(1)

207,246 505,528 -

505,528 207,246 113,913,815 242,358,076 7,723 242,365,799 127,731,487 1.90 360,614,646 1.49

113,913,815 263,082,695 7,723 263,090,418 148,456,106 1.77 360,614,646 1.37

1.58

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MALAYSIAN AE MODELS HOLDINGS BERHAD PROPOSALS

Notes:(1) (2) (3) (4) (5) (6) After capitalisation for the Second Call from the Companys share premium and retained earnings. After adjusting for the theoretical fair-value of RM0.01 per Warrant, which was arrived at using the Black-Scholes option pricing model and capitalised from the retained earnings. After deducting the estimated expenses of RM1.0 million relating to the Proposals. Assuming the repayment of bank borrowings of RM7.6 million derived from the proceeds of the Proposed Rights Issue. Transfer of the entire warrant reserve to the share premium upon conversion of all the Warrants. Calculated based on total borrowings divided by total equity.

Maximum Scenario
Proforma I Audited as at 31 May 2011 RM 107,006,868 3,064,390 505,528 122,418,981 232,995,767 7,723 233,003,490 107,006,868 2.18 368,225,239
(6) (4) (1) (3) (2)

Proforma II Assuming full exercise of Warrants RM 214,013,736

(5)

Maximum Scenario Share capital Share premium Other reserves Warrants reserve Retained earnings Shareholders equity / NA Minority interests Total equity No. of MAE Shares NA per MAE Share (RM) Borrowings (RM) Gearing (times)

After the Proposed Rights Issue RM 160,510,302

(1)

535,034 505,528 -

505,528 535,034 97,196,620 7,723 258,755,207 160,510,302 1.61 344,225,239 1.33

97,196,620 312,250,918 7,723 312,258,641 214,013,736 1.46 344,225,239 1.10

258,747,484

1.58

Notes:(1) (2) (3) (4) (5) (6) After capitalisation for the Second Call from the Companys share premium and retained earnings. After adjusting for the theoretical fair-value of RM0.01 per Warrant, which was arrived at using the Black-Scholes option pricing model and capitalised from the retained earnings. After deducting the estimated expenses of RM1.0 million relating to the Proposals. Assuming the repayment of bank borrowings of RM24.0 derived from the proceeds of the Proposed Rights Issue. Transfer of the entire warrant reserve to the share premium upon conversion of all the Warrants. Calculated based on total borrowings divided by total equity.

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MALAYSIAN AE MODELS HOLDINGS BERHAD PROPOSALS

4.3

Substantial shareholders shareholdings The proforma effects of the Proposed Rights Issue on the substantial shareholders shareholdings in MAE are set out below:Minimum Scenario
Proforma I Shareholdings as at 17 February 2012 Direct Indirect % 28.93 1.60 9.91 8.21
(2) (1)

Proforma II Assuming full exercise of the Warrants Direct % 36.36 0.02 No. of Shares 61,915,780 3,422,696 10,599,732 17,560,000 % 41.71 2.31 7.14 11.83
(2) (1)

After the Proposed Rights Issue Direct % No. of Shares 46,436,835 2,567,022
(3)

Indirect % 36.36 2.01 8.30 10.31

(2) (1)

Indirect No. of Shares 61,915,780 20,000 % 41.71 0.01

Substantial shareholders Aemnic Datuk Dr Lim LembagaTabung Haji Dato Sri Koh

No. of Shares 30,957,890 1,711,348 10,599,732 8,780,000

No. of Shares 30,957,890 20,000

No. of Shares 46,436,835 20,000

28.93 0.02

10,599,732 13,170,000

Notes:(1) (2) (3) Deemed interest by virtue of his interest in Aemnic pursuant to Section 6A of the Companies Act, 1965. Deemed interest by virtue of his sons shareholdings. Assuming LembagaTabung Haji did not subscribe to their Rights Shares entitlements.

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MALAYSIAN AE MODELS HOLDINGS BERHAD PROPOSALS

Maximum Scenario
Proforma I Shareholdings as at 17 February 2012 Direct Substantial shareholders Aemnic Datuk Dr Lim LembagaTabung Haji Dato Sri Koh No. of Shares 30,957,890 1,711,348 10,599,732 8,780,000 % 28.93 1.60 9.91 8.21
(2) (1)

Proforma II Assuming full exercise of the Warrants Direct % 28.93 0.02 No. of Shares 61,915,780 3,422,696 21,199,464 17,560,000 % 28.93 1.60 9.91 8.21
(2) (1)

After the Proposed Rights Issue Direct % No. of Shares 46,436,835 2,567,022 15,899,598 13,170,000 % 28.93 1.60 9.91 8.21
(2) (1)

Indirect No. of Shares 30,957,890 20,000

Indirect No. of Shares 46,436,835 30,000

Indirect No. of Shares 61,915,780 40,000 % 28.93 0.02

28.93 0.02

Notes:(1) (2) Deemed interest by virtue of his interest in Aemnic pursuant to Section 6A of the Companies Act, 1965. Deemed interest by virtue of his sons shareholdings.

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MALAYSIAN AE MODELS HOLDINGS BERHAD PROPOSALS 4.4 Earnings and EPS The Proposed Rights Issue is not expected to have any material effect on the earnings of the MAE Group for the FYE 31 May 2012. However, the utilisation of proceeds from the Proposed Rights Issue is expected to contribute positively to the earnings and EPS of the Group due to the interest cost savings from the repayment of borrowings. Nevertheless, the EPS of the Company may be diluted as a result of the increase in the number of MAE Shares in issue after the Proposed Rights Issue and as and when the Warrants are being exercised into new MAE Shares. However, the eventual effect on the EPS of the Company would also depend on, inter-alia, the impact of interest savings from the paring down of MAEs borrowings and the number of Rights Shares issued. 4.5 Dividend Barring any unforeseen circumstances, any dividend to be declared by MAE for the FYE 31 May 2012 will depend on, amongst others, the profitability and cashflow position of the MAE Group. The Proposed Rights Issue is not expected to have any material effects on the dividend policy of the Company. 4.6 Convertible securities As at the date of this announcement, MAE does not have any convertible securities. 5. APPROVALS REQUIRED The Proposed Rights Issue is conditional upon the approvals being obtained from the following:(a) Bursa Securities, for the following:(i) the admission of the Warrants to be issued pursuant to the Proposed Rights Issue on the Official List of the Main Market of Bursa Securities; the listing of and quotation for the Rights Shares and Warrants to be issued pursuant to the Proposed Rights Issue on the Official List of the Main Market of Bursa Securities; and the listing and quotation for the new MAE Shares to be issued upon the exercise of the Warrants on the Official List of Main Market of Bursa Securities;

(ii)

(iii)

(b) (c)

Securities Commission Malaysia, for the Proposed Exemption; Controller of Foreign Exchange (via Bank Negara Malaysia), for the issuance of Warrants to non-resident shareholders of MAE pursuant to the Proposed Rights Issue; Shareholders of MAE, for the Proposals, at an Extraordinary General Meeting (EGM))to be convened later; and any other relevant authorities, if required.

(d)

(e) 6.

INTER CONDITIONALITY The Proposals are inter-conditional upon each other. The Proposals are not conditional upon any other corporate exercise undertaken or to be undertaken by the Company.

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MALAYSIAN AE MODELS HOLDINGS BERHAD PROPOSALS

7.

INTEREST OF DIRECTORS, CONNECTED TO THEM

MAJOR

SHAREHOLDERS

AND/OR

PERSONS

Save as disclosed below, none of the Directors, major shareholders and/or persons connected to them have any interest, direct or indirect, in the Proposals. 7.1 Proposed Rights Issue None of the Directors or major shareholders of MAE and/or person(s) connected to them have any interest, whether direct or indirect, in the Proposed Rights Issue beyond their respective entitlements as shareholders of the Company, for which all existing shareholders of MAE are entitled to, including the rights to apply for additional Rights Shares under the excess Rights Shares application. To the best of the Boards knowledge, the Board is not aware of any of its Directors, major shareholders and/or person(s) connected to the Directors or major shareholders who have any interest, direct or indirect, in the Proposed Rights Issue. 7.2 Proposed Exemption Aemnic, being the major shareholder of MAE is deemed interested in the Proposed Exemption. Datuk Dr Lim, the group managing director and chairman of MAE, is deemed interested in the Proposed Exemption by virtue of him being a Director and substantial shareholder of Aemnic. Mr Lim Kee Yin and Mr Choo Chee Kiat, the directors of MAE, are deemed interested in the Proposed Exemption by virtue of their relationships with Datuk Dr Lim. Mr Lim Kee Yin and Mr. Choo Chee Kiat are the brother and brother-in-law of Datuk Dr Lim respectively. Accordingly, Datuk Dr Lim, Mr Lim Kee Yin and Mr Choo Chee Kiat have abstained and will continue to abstain from any deliberations and voting in Board meetings to consider the Proposed Exemption. In addition, Aemnic, Datuk Dr Lim, Mr Lim Kee Yin and Mr Choo Chee Kiat will abstain and will also ensure that the persons connected to them will abstain from voting, where relevant, in respect of their direct and indirect interest in MAE, if any, on the resolution pertaining to the Proposed Exemption at the EGM to be convened. Save as disclosed above, none of the other Directors and/or substantial shareholders and/or persons connected with them has any interest, whether direct or indirect, in the Proposed Exemption. 8. DIRECTORS STATEMENT The Board (other than Datuk Dr Lim, Mr Lim Kee Yin and Mr Choo Chee Kiat who are interested in the Proposed Exemption) having considered all aspects of the Proposals (including but not limited to the rationale and financial effects), is of the opinion that the Proposals are in the best interest of the Company. 9. ADVISER OSK has been appointed as the Principal Adviser to the Company for the Proposals. The Board will appoint an Independent Adviser to advise the non-interested shareholders and non-interested Directors of MAE on the Proposed Exemption. 10. ESTIMATED TIMEFRAME FOR THE COMPLETION Barring any unforeseen circumstances and subject to all required approvals, the Board expects the Proposals to be completed by the first half of 2012. Page 15 of 16

MALAYSIAN AE MODELS HOLDINGS BERHAD PROPOSALS

11.

SUBMISSION TO THE RELEVANT AUTHORITIES Barring any unforeseen circumstances, the applications to the relevant authorities as stated in Section 5 above, will be made within one (1) month from the date of this announcement.

This announcement is dated 2 March 2012.

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