LOTTE CHEMICAL TITAN HOLDING BERHAD Registration No. 199101012045 (222357-P)

(Incorporated in Malaysia)

MINUTES OF THE 2020 ANNUAL GENERAL MEETING MINUTES of the 2020 Annual General Meeting of the Company held virtually and broadcasted from Manuka 2 & 3 Meeting Room, Unit 29-01, Level 29, Tower A of Vertical Business Suite, Avenue 3 of Bangsar South on Monday, 29 June 2020 at 2.30 p.m.

Present : The Board of Directors

Tan Sri Dato’ Abdul Rahman Bin Mamat -Chairman Dr. Lee Dong Woo (President & Chief Executive Officer) Tan Sri Datuk (Dr) Rafiah Binti Salim (Independent Non-Executive Director) Tan Sri Datin Paduka Siti Sa’diah binti Sheikh Bakir (Independent Non-Executive Director) Mr Ang Ah Leck (Independent Non-Executive Director) Mr Lee Kwan Ho (Non-Independent Executive Director) (via video conferencing)

Absent : Ms Park Jae Sun (Non-Independent Non-Executive Director)

In Attendance : Mr Philip Kong Chock Hoon (Executive Vice President, Corporate Planning, Company Secretary) Mr. David Tan Gek Seng (Chief Financial Officer) Ms Lim Yoke Ping (Joint Company Secretary) Shareholders, Proxies and Authorised Representatives

As per Attendance List.

1. OPENING ADDRESS The Chairman extended a warm welcome to the shareholders, proxies and authorised representatives attending the 2020 Annual General Meeting (“AGM”).

2. INTRODUCTION OF THE BOARD OF DIRECTORS The Chairman introduced the members of the Board, Management and External Auditors who were present at the Broadcast Venue and who were in attendance via video conferencing.

3.

QUORUM OF MEETING Following a confirmation from the Company Secretary that there was a quorum present at the Meeting in accordance with Clause 75 of the Company’s Constitution, the Chairman declared the 2020 AGM duly constituted.

4. NOTICE OF MEETING As the Notice convening the Meeting was circulated to the shareholders within the prescribed period, the Notice convening the Meeting was taken as read.

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5. PRESENTATION BY PRESIDENT & CEO The President & CEO, Dr Lee Dong Woo shared a video presentation on the Group’s business performance covering inter alia:-

- Business Performance & Market Outlook - Indonesia LINE Project Update - Growth Strategy & Vision - Sustainability

Process Safety Management

COVID-19 Pandemic: Our Commitment to Society

Anti-Bribery & Anti-Corruption Framework

Plastic Applications

Sustainable Plastics

6. VOTING OF RESOLUTIONS AT THE MEETING The Chairman invited the Secretary to proceed with the briefing on the voting information. The Secretary reported that the Company had received 117 valid proxies carrying 1,892,267,172 shares or representing 83.25% of the Company’s total number of issued shares. The Secretary then informed the shareholders, proxies and duly authorized representatives present that all resolutions as set out in the Notice of the AGM would be put to vote by poll. The shareholders were also informed that the Company has appointed Tricor Investor & Issuing House Services Sdn Bhd to conduct the poll and Quantegic Services Sdn Bhd as the Independent Scrutineers to verify the poll results. The Secretary informed that the online voting process will be carried out from the commencement of the Meeting until the end of the voting session that will be announced later. The poll process would be conducted after deliberation of all items to be transacted at the AGM and questions have been dealt with. The Secretary then invited Tricor to brief the shareholders on the e-voting process via TIIH Online.

7. QUESTIONS FROM THE MINORITY SHAREHOLDERS WATCH GROUP Before proceeding to table the items on the agenda for consideration, the Chairman informed the Meeting that the Company had received a letter from the Minority Shareholders Watch Group (“MSWG”) dated 14 June 2020 and for the benefit of the shareholders, the Chairman invited Mr Philip Kong, the Executive Vice President and Company Secretary and Ms Lim Yoke Ping, the Joint Company Secretary to present the questions and responses to the questions from the MSWG, which are contained in Appendix I to the minutes. The Chairman further informed that any questions that the shareholders raised will be taken after all resolutions for the Meeting have been presented.

8. AUDITED FINANCIAL STATEMENTS AND REPORTS OF DIRECTORS AND AUDITORS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2019 The Chairman proceeded with the tabling of the Audited Financial Statements and Reports of Directors and Auditors for the financial year ended 31 December 2019. The Chairman then proceeded with the next agenda.

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9.

ORDINARY RESOLUTION 1- RE-ELECTION OF TAN SRI DATO ABDUL RAHMAN BIN MAMAT PURSUANT TO CLAUSE 100 OF THE COMPANY’S CONSTITUTION As the agenda involved Tan Sri Dato Abdul Rahman bin Mamat, the Chair was handed to Dr Lee Dong Woo. Dr Lee tabled Ordinary Resolution 1 on the re-election of Tan Sri Dato Abdul Rahman Bin Mamat who retires in accordance with Clause 100 of the Company’s Constitution to the shareholders.

Dr Lee highlighted that it was stated in the response to the MSWG’s letter that although Tan Sri Rahman joined the Board in 2011, his tenure as an independent director only commenced upon the listing of the Company in 2017. Therefore, to date, Tan Sri Rahman has been an independent director of Lotte Chemical Titan Holding Berhad for a period of 3 years. The profile of Tan Sri Rahman was provided to the shareholders on page 87 of the Annual Report.

Dr Lee then handed the Chair back to Tan Sri Rahman.

10. ORDINARY RESOLUTION 2- RE-ELECTION OF ANG AH LECK WHO RETIRES PURSUANT TO CLAUSE 100 OF THE COMPANY’S CONSTITUTION Ordinary Resolution 2 on the re-election of Mr Ang Ah Leck who retires in accordance with Clause 100 of the Company’s Constitution was tabled to the shareholders. The profile of Mr Ang was provided to the shareholders on page 89 of the Annual Report.

11. ORDINARY RESOLUTION 3- RE-ELECTION OF PARK JAE SUN WHO RETIRES PURSUANT TO CLAUSE 107 OF THE COMPANY’S CONSTITUTION Ordinary Resolution 3 on the re-election of Ms Park Jae Sun who retires in accordance with Clause 107 of the Company’s Constitution was tabled to the shareholders. The profile of Ms Park Jae Sun was provided to the shareholders on page 93 of the Annual Report.

12. ORDINARY RESOLUTION 4- PAYMENT OF DIRECTORS’ FEES AMOUNTING TO RM780,000.00 FOR THE FINANCIAL YEAR ENDING 31 DECEMBER 2020 Ordinary Resolution 4 which is to consider the payment of Directors’ Fees amounting to RM780,000.00 for the financial year ending 31 December 2020 was tabled to the shareholders. It was highlighted that Tan Sri Dato’ Abdul Rahman, Tan Sri Rafiah and Mr Ang Ah Leck, being the interested directors who are shareholders would abstain from voting on this resolution.

13. ORDINARY RESOLUTION 5- PAYMENT OF DIRECTORS’ REMUNERATION AND BENEFITS

(EXCLUDING DIRECTORS’ FEES) TO NON-EXECUTIVE DIRECTORS UP TO AN AMOUNT OF RM179,000.00 WITH EFFECT FROM 2020 AGM UNTIL THE NEXT ANNUAL GENERAL MEETING OF THE COMPANY Ordinary Resolution 5 on the payment of Directors’ Remuneration and Benefits (excluding Directors’ Fees) to Non-Executive Directors up to an amount of RM179,000.00 with effect from 2020 AGM until the next Annual General Meeting of the Company was tabled to the shareholders. It was highlighted that Tan Sri Dato’ Abdul Rahman, Tan Sri Rafiah and Mr Ang Ah Leck, being the interested directors who are shareholders would abstain from voting on this resolution.

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14. ORDINARY RESOLUTION 6- APPOINTMENT OF AUDITORS The Chairman informed the Meeting that the Company’s Auditors, Messrs Ernst & Young (“EY”) are retiring at this AGM. EY have indicated that they will not be seeking re-appointment as External Auditors at the forthcoming Annual General Meeting. On behalf of the Board of Directors, the Chairman placed on record their appreciation to EY for the services rendered to the Group over the last five (5) years. The Chairman further informed the shareholders that the Company had on 7 February 2020 received a letter from the major shareholder, Lotte Chemical Corporation for the nomination of Messrs KPMG PLT as auditors of the Company and had proposed the following ordinary resolution:- “THAT Messrs KPMG PLT be and are hereby appointed as auditors of the Company in place of the retiring auditors, Messrs Ernst & Young, and to hold office until the conclusion of the next Annual General Meeting AND THAT the Directors be authorized to fix their remuneration.”

15. ORDINARY RESOLUTION 7- RECURRENT RELATED PARTY TRANSACTIONS The resolution on the Proposed Shareholders’ Mandate for the Company and/or its subsidiaries to enter into Recurrent Related Party Transactions of a revenue or trading in nature and contracts entered into from time to time which are necessary or would facilitate the day-to-day operations with related parties was tabled. The Chairman informed the Meeting that the related parties involved in the Recurrent Related Party Transactions, namely Dr. Lee Dong Woo, Mr Lee Kwan Ho, being the interested Directors and also the shareholders of the Company and Lotte Chemical Corporation, being the major shareholder of the Company shall abstain from voting for this resolution.

16. QUESTIONS AND ANSWERS SESSION The Chairman invited the Executive Vice President and Company Secretary, Mr Philip Kong to read out the questions that have been received. Mr Philip Kong read through the questions and responses on the questions that were received as per Appendix II. Mr Philip Kong stated that in the interest of time, those questions which have not been addressed in the President & CEO presentation and responses to the MSWG will be posted in the Company’s website. Those questions and responses are attached in Appendix III.

17. POLL PROCESS At 3.20 p.m., the Chairman reminded shareholders to vote as the voting session would continue for another 10 minutes. At 3.30 p.m., the Chairman announced that the voting session for the 2020 AGM had ended. The Meeting was adjourned to facilitate the voting process.

18. ANNOUNCEMENT OF POLL RESULTS The Chairman called the Meeting to order at 3.45 p.m. for the declaration of the poll results which has been verified by the Independent Scrutineers. A copy of the poll results is attached as per Appendix IV. The Chairman declared all resolutions that had been put to the Meeting were duly carried.

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19. CLOSURE OF MEETING The Meeting was declared closed at 3.50 p.m. with a vote of thanks to the Chair.

Appendix II

Responses to the questions received

1) Will the Company provide any gift or e-voucher?

Answer: No, there will be no gift or e-voucher.

2) What is the management’s view on the average plant utilisation rate for year 2020?

Answer: 2020’s projected utilization rate will be in the range of 80% - 85%. This is slightly

below last year’s utilization of 88% due to statutory turnaround in 2020.

3) Will board of directors consider undertaking a share buyback exercise?

Answer: No, because our public spread is below the minimum 25% requirement.

4) Will our company consider venturing into the rubber glove industry, as it is considered to be

recession-proof?

Answer: We do produce raw materials that are capable of producing gloves. We are in

continuous pursuit of business opportunities that can add synergy and value to the

company.

5) What is the royalty expense? Who is this paid to?

Answer: The royalty expense is paid to our holding company, Lotte Chemical Corporation

(“LCC”) mainly for using Licensed Brands which owned by LCC or which LCC has

the right to grant license to, such as Lotte’s trademark, name and logo. This is in

accordance with international practices and the royalty payable is below market

range based on review done by external consultant.

6) What is the impact of single use plastic ban on the Company’s business and what is your

strategy to counter this?

Answer: The SUP ban to-date primarily focused on banning of single-use plastic bags and

straws. The impact to the company is immaterial.

7) What is the total production in tonnes for each for year 2018 & 2019 and also 1Q 2020?

Answer: 2018: 2.86 million metric tonnes

2019: 3.15 million metric tonnes – an increase of 10%

Q1 2020: 585 thousand metric tonnes. Lower production volume in Q1 as there was

a statutory turnaround.

8) Did the Company hedge its naphtha feedstock during the recent crude oil/naphtha price crash?

Answer: We purchased our naphtha feedstock based on our storage capacity and optimal

plant production requirement.

9) Will the company be writing down the inventories again in their coming quarterly report?

Answer: Any provision for net realizable value on inventories is made based on the difference

between our inventory costs and latest prevailing market price for both feedstock

and products. We will not have further major write down for inventories if the current

market prices remain stable or no sudden plunge in prices.

10) Did the company stop operating during the MCO?

Answer: No, our operations continued as usual during MCO as we are classified as an

essential service provider.

11) Correlation between group performance and crude oil price. What is the outlook on crude oil

price?

Answer: Our performance is mainly determined by the polymer-naphtha spread. However, our

naphtha feedstock is correlated with global crude oil price movement, which is

currently very volatile.

12) Under current low oil price environment, can LC USA secure sufficient supply of ethane

feedstock for its US operations?

Answer: LC USA is able to purchase sufficient ethane feedstock from diversified sources,

which include international oil majors such as Shell and BP as well as other local

US-based midstream majors.

13) What is the current operating condition for our LC USA plants?

Answer: Currently, our LC USA plants are operating as usual with full run rate. We always

maintain plant optimization initiatives that will ensure sufficient plant operating levels

while optimizing profitability from operations.

Appendix III

AGM Shareholders’ Questions - Live Questions

Disclaimer: These are additional questions raised during the AGM, which are not covered in the Annual

Report, CEO Presentation, MSWG questions and Q&A read-out during the virtual AGM.

1) NRV impact is notably high in Q1’20. What is NRV and when or how does it affect the Company?

Ans: Net realisable value (NRV) is a prudent accounting method to recognize the fair valuation of

finished goods inventory. It is also a common method used to evaluate an asset value for

inventory accounting and it is done in accordance to Accounting Standard (MFRS 102).

NRV is an accounting provision which occurs when there is a drop in market value of finished

goods inventory (i.e. monomer and polymer products) and the impact accounts for the difference

between production cost and prevailing market price of the inventory.

It is a temporary accounting provision which will be fully reversed in the following quarter. A new

NRV provision will be made should there be further drop in market value of the finished goods

inventory and vice-versa.

2) Please explain on naphtha feedstock and average product selling price (ASP) movement since

Q1’20.

Ans: Naphtha prices has fallen following the plunge in global crude oil price in March and April

2020. Subsequently, the prices have been on the uptrend, similar to that of Brent crude during

the period.

On the other hand, our polymer product ASP have been on gradual uptrend since bottoming out

in April 2020.

Hence, this has improved the average market product spread as compared to Q1’20.

3) How has the Company benefited from the Covid-19 pandemic? Is there any business impact

from the MCO lockdown in Malaysia and the region?

Ans: With the Covid-19 pandemic, we observed relatively higher demand for our products for

production of disposable food packaging and medical equipment. This has partially mitigated the

impact from loss of demand from other industrial plastic segment resulting from the MCO

lockdown. Overall demand has started to recover in mid-April after the re-opening of economic

activities in China and followed by other countries in the region, including Malaysia.

Appendix III

4) What is the Company’s strategic plan to utilize the RM 4 Billion cash balance?

Ans: The unutilized IPO proceeds amounting to about RM 2.6 Billion as at Q1’20 will be part of the

investment in the LINE Project and the balance from internally generated funds will be utilized for

business operations.

5) Pertaining to the absence of Ms. Park Jae Sun, what are the unforeseen circumstances that Ms.

Park has to attend to and thus causing her absence in this virtual meeting? Company’s directors

are expected to present in AGM, more so in a virtual meeting which directors can join at the

ease of without physically present at meeting venue. More so, Ms. Park stands for re-election

as a director of the Company in this AGM. She is expected to present in the meeting.

Ans: Ms. Park had originally planned to attend the AGM. Unfortunately, she had to excuse herself

to attend to an urgent work matter which arose unexpectedly.

6) LUSR remain losses. Why not dispose it and focus on core business?

Ans: This is a strategic shareholding in LUSR (The first Polybutadiene rubber plant in Malaysia) and

it is a synergistic and long-term investment for LCT.

7) Why the Company does not wind-up the dormant subsidiaries?

Ans: Referring to Announcement dated 10th October 2019, as part of the LCT’s streamlining

exercise to reduce the number of dormant subsidiaries in the group, we are winding-up the

dormant companies.

https://disclosure.bursamalaysia.com/FileAccess/viewHtml?e=2993502

8) Refer to Note 32(a) to the financial statements, is the RM586 million contracted capital

commitments refer to the Integrated Petrochemical Facility project? What are those RM419

million (2018 – RM196 million) approved but not contracted commitments?

Ans: Yes, the RM 586 million contracted capital commitments include the Integrated

Petrochemical Facility Project as well as other maintenance, improvement and modification

projects for our plants. The approved but not contracted commitments of RM 419 million includes

statutory turnaround costs for FY 2020 and other maintenance, improvement and modification

projects for our plants.

Appendix III

9) Refer to page 2 of the financial statements, it state that the financial results of the Group and

the Company for FY2019 were substantially affected by the item, transaction or event disclosed

in the financial statements. Could the Board enlighten us, which are the item, transaction or

event in the financial statements?

Ans: The material transactions carried out in FY 2019 refer to the divestment of ordinary shares

in PT Lotte Chemical Indonesia and divestment by our associate, Lotte Chemical USA Corporation,

of a portion of its equity interest in LACC LLC to Eagle US 2 LLC.

10) Refer to page 12 of the financial statements, noted that the Company suffered a RM25 million

loss on foreign exchange. Does the Company hedge its exposure to foreign currency risk? There

was nothing disclosed in the note 34(c). If no, why not?

Ans: Generally, the Group does not do hedging. The Company occasionally enters into foreign

currency forward contract when such opportunity arises.

11) Refer to note 14, it states that RM6.7 million depreciation of right-of-use assets was capitalized

as part of property, plant and equipment. What is the rationale and how does it work?

Ans: The RM 6.7 million deprecation of right-of-use assets is related to land use right of PT Lotte

Chemical Indonesia (“LCI”). As LCI’s petrochemical plant will be constructed on the land, the

depreciation of land during the construction period is considered as costs incurred to bring the

petrochemical plant to its intended operating manner. Thus, the depreciation is capitalized as part

of the construction in progress. This is in accordance to Accounting Standard (MFRS 116).

12) Has the Company considers open tender for those recurrent related party transactions? If not,

how did the Board satisfied themselves that the transactions are in the best interest of the

Company?

Ans: The Company has in place a Related Party Transaction Protocol to ensure that RRPTs are

undertaken on an arm’s length basis and on normal commercial terms that are not more

favourable to the related party(ies) than those generally available to the public and not

detrimental to the minority shareholders. Please refer to Section 2.4 of the RRPT Circular dated

17 April 2020 for further details on the review procedures implemented by the Group for all RRPT.

Appendix III

13) There have been significant increase in related parties transactions, i.e. sales of goods RM78.3

million (2018 – RM48.1 million), despite the dropped in the sales revenue. Any reasons?

Ans: The increase in sales of goods with related parties is due to increase in sales volume to the

related parties. The drop in Group’s sales revenue is following the decrease in average product

selling prices (ASP) but partially offset by the increase in sales volume during the period.

14) Does the company have a formal process for planning the succession of each director/key

personnel?

Ans: The Company has a succession programme put in place. The succession programme is a

continuous process that is carried out by the Company to ensure the best mix of high potential

candidates are identified for key business areas and key positions which are critical in supporting

the Company’s operational activities and strategic business objectives.

The succession plan for the Directors and key positions is reviewed by the Nomination and

Remuneration Committee and Board.

15) Does the Company have any retirement policy for Directors?

Ans: In line with the Company’s Constitution, at the first Annual General Meeting of the Company,

all the Directors shall retire from office, and at the Annual General Meeting in every subsequent

year, one-third (1/3) of the Directors for the time being or if their number is not three (3) or a

multiple of three (3), then the number nearest to one-third (1/3) shall retire from office and be

eligible for re-election, provided always that all Directors shall retire from office at least once

every three (3) years but shall be eligible for re-election.

Catherine

Typewriter

Appendix IV