THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION.

If you are in any doubt as to the course of action you should take, you should consult your stockbroker, bank manager, solicitor, accountant or other professional adviser immediately. Bursa Malaysia Securities Berhad (Bursa Securities) has not perused this Circular in relation to the Proposed Amendment (as defined herein) prior to the issuance of this Circular. Bursa Securities takes no responsibility for the contents of this Circular, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from, or due to your reliance upon, the whole or any part of the contents of this Circular. You should rely on your own evaluation to assess the risks of the Proposed Scheme and Proposed Amendment (as defined herein).

KUB MALAYSIA BERHAD

(Company No. 6022-D) (Incorporated in Malaysia under Companies Act, 1965)

CIRCULAR TO SHAREHOLDERS IN RELATION TO THE (I) PROPOSED ESTABLISHMENT OF AN EMPLOYEES SHARE SCHEME COMPRISING A SHARE OPTION PLAN AND A PERFORMANCE SHARE PLAN FOR THE ELIGIBLE EMPLOYEES AND DIRECTORS OF KUB MALAYSIA BERHAD AND ITS SUBSIDIARIES; PROPOSED AMENDMENT TO THE ARTICLES OF ASSOCIATION OF KUB MALAYSIA BERHAD; AND NOTICE OF EXTRAORDINARY GENERAL MEETING
Scheme Adviser
in relation to the Proposed Scheme (as defined herein)

(II)

Principal Adviser

(A Participating Organisation of Bursa Malaysia Securities Berhad)

The Notice of Extraordinary General Meeting (EGM) and the Form of Proxy for the EGM are set out in this Circular. Our EGM will be held as follows: Place of EGM Date and time of EGM : : Laman Puteri, Hotel Singgahsana Petaling Jaya, Persiaran Barat off Jalan Sultan, 46760 Petaling Jaya, Selangor Thursday, 26 June 2008 at 1:00 p.m. or immediately after the conclusion or any adjournment of the Companys Extraordinary General Meeting (in relation to, amongst others, the Proposed Revised Par Value Reduction, this Extraordinary General Meeting being scheduled to be held at 12.30 p.m. or immediately after the conclusion or any adjournment of the Companys 43rd Annual General Meeting to be held on the same day and at the same venue) whichever is the later.

If you are entitled to attend and vote at the EGM, you may appoint up to two (2) proxies to attend and vote on your behalf. The Form of Proxy for the EGM must be deposited at the office of our Companys Share Registrar, Symphony Share Registrars Sdn Bhd, Level 26, Menara Multi-Purpose, Capital Square, No 8 Jalan Munshi Abdullah, 50100 Kuala Lumpur by hand or by fax to 03-27212530/31 not less than forty-eight (48) hours before 1:00 p.m. on the date set for holding the EGM or any adjournment thereof. The lodging of the Form of Proxy for the EGM will not preclude you from attending and voting in person at the EGM should you subsequently wish to do so.

This Circular is dated 4 June 2008

DEFINITIONS Except where the context otherwise requires, the following definitions shall apply throughout this Circular: Act Articles Board or Director(s) Bursa Securities By-Law(s) CIMB EGM Eligible Participant ESS Committee : : : : : : : : : Companies Act, 1965 and any amendments made thereto from time to time Articles of Association Member(s) of the Board of Directors of our Company Bursa Malaysia Securities Berhad By-Laws governing the Proposed Scheme CIMB Investment Bank Berhad Extraordinary General Meeting A person who meets the criteria of eligibility for participation in the Proposed Scheme as set out in By-Law 4 The employees share scheme committee appointed by our Board to implement and administer the Proposed Scheme in accordance with the By-Laws KUB Malaysia Berhad KUB and our subsidiaries Ordinary share(s) of RM0.40 each in our Company, upon the completion of the Proposed Revised Par Value Reduction Listing requirements of Bursa Securities Net assets An agreement entered into between a Performance Share Plan Participant and our Company pursuant to the Proposed Performance Share Plan An Eligible Participant who has entered into a Performance Share Plan Agreement The reference price of each Performance Share to be issued pursuant to a Performance Share Plan Agreement New KUB Shares to be allotted to an Eligible Participant who has entered into a Performance Share Plan Agreement Collectively, the Proposed Scheme and the Proposed Amendment The proposed amendment to Article 158 of the Articles of our Company The plan referred to under Section II of the By-Laws The proposed reduction of the existing issued and paid-up ordinary share capital of our Company (pursuant to Section 64 of the Act) comprising ordinary shares of RM1.00 each in our Company to ordinary shares of RM0.40 each, by way of the cancellation of RM0.60 of the par value of each existing ordinary share in issue

KUB or Company KUB Group or Group KUB Share(s) Listing Requirements NA Performance Share Plan Agreement Performance Share Plan Participant Performance Share Price Performance Share(s) Proposals Proposed Amendment Proposed Performance Share Plan Proposed Revised Par Value Reduction

: : : : : :

: : : : : : :

DEFINITIONS (Contd) Proposed Scheme Proposed Share Option Plan RM and sen Scheme Shares : : : : Collectively, the Proposed Share Option Plan and Proposed Performance Share Plan The plan referred to under Section I of the By-Laws Ringgit Malaysia and sen respectively New KUB Shares issued pursuant to an exercise of Share Options and/or allotment and issuance of Performance Shares in accordance with the Proposed Scheme An Eligible Participant who has accepted the Share Option Offer and has been granted a Share Option The price of each underlying new KUB Share comprised in the Share Option The option(s) granted by the ESS Committee to an Eligible Participant in accordance with the Proposed Share Option Plan

Share Option Holder(s) Share Option Price Share Option(s)

: : :

All references to our Company in this Circular are to KUB, references to our Group are to our Company and our subsidiaries. References to we, us, our, ourselves are to our Company, or where the context requires, our Group. References to you in this Circular are references to the shareholders in our Company. Words denoting the singular shall include the plural and vice versa and words denoting the masculine gender shall, where applicable, include the feminine gender and vice versa. Reference to persons shall include corporations. Any reference to any enactment in this Circular is a reference to that enactment as for the time being amended or re-enacted.

ii

CONTENTS LETTER TO OUR SHAREHOLDERS CONTAINING: SECTION 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. INTRODUCTION DETAILS OF THE PROPOSALS RATIONALE FOR THE PROPOSALS UTILISATION OF PROCEEDS FINANCIAL EFFECTS OF THE PROPOSALS HISTORICAL KUB SHARE PRICES APPROVALS REQUIRED OUTSTANDING CORPORATE PROPOSALS ANNOUNCED BUT PENDING IMPLEMENTATION DIRECTORS AND MAJOR SHAREHOLDERS INTERESTS DIRECTORS RECOMMENDATION EGM FURTHER INFORMATION PAGE 1 2 6 6 6 9 9 10 11 11 11 12

APPENDICES I II DRAFT BY-LAWS OF THE PROPOSED SCHEME FURTHER INFORMATION ENCLOSED ENCLOSED

NOTICE OF EGM FORM OF PROXY

KUB MALAYSIA BERHAD

(Company No. 6022-D) (Incorporated in Malaysia under Companies Act, 1965)

Registered Office Level 8, Block D Kompleks Kelana Centre Point Jalan SS7/19, Kelana Jaya 47301 Petaling Jaya Selangor Darul Ehsan 4 June 2008 Directors Dato' Nordin Baharuddin (Chairman/Non-Independent Non-Executive Director) Datuk Hj Faisyal Datuk Yusof Hamdain Diego (Senior Independent Non-Executive Director) Dato Kamilia Ibrahim (Non-Independent Non-Executive Director) Rosman Abdullah (Non-Independent Non-Executive Director) Raja Ali Raja Othman (Independent Non-Executive Director) Mohamed Ezzuddeen Mohd Effendi (Independent Non-Executive Director) Omar Haji Ahmad (Independent Non-Executive Director) Mohd Nazar Samad (Executive Director) To: Our Shareholders Dear Sir/Madam KUB MALAYSIA BERHAD (I) PROPOSED ESTABLISHMENT OF AN EMPLOYEES SHARE SCHEME COMPRISING A SHARE OPTION PLAN AND A PERFORMANCE SHARE PLAN FOR THE ELIGIBLE EMPLOYEES AND DIRECTORS OF THE KUB GROUP; AND PROPOSED AMENDMENT TO THE ARTICLES OF ASSOCIATION OF KUB INTRODUCTION On 23 May 2008, CIMB, on behalf of our Board, announced that we proposed to establish an employee share scheme for the eligible employees and directors of our Group (excluding subsidiaries which are dormant) after the completion of a proposed par value reduction exercise to be undertaken by us. On the same date, CIMB, on behalf of our Board, also announced the Proposed Amendment. The Proposed Scheme will consist of the Proposed Share Option Plan and Proposed Performance Share Plan, and is conditional on the Proposed Revised Par Value Reduction and the Proposed Amendment, but not vice versa.

(II) 1.

The Proposed Revised Par Value Reduction will involve the reduction of our existing issued and paid-up ordinary share capital (pursuant to Section 64 of the Act) comprising ordinary shares of RM1.00 each in KUB to ordinary shares of RM0.40 each by way of the cancellation of RM0.60 of the par value of each existing ordinary share of KUB in issue. Further details of the Proposed Revised Par Value Reduction are set out in the announcement dated 15 May 2008, and in the Circular to you dated 4 June 2008 in relation to the Proposed Revised Par Value Reduction. THE PURPOSE OF THIS CIRCULAR IS TO PROVIDE YOU WITH THE DETAILS, RATIONALE AND FINANCIAL EFFECTS OF THE PROPOSALS AND TO SEEK YOUR APPROVAL ON THE RESOLUTIONS PERTAINING TO THE PROPOSALS TO BE TABLED AT OUR FORTHCOMING EGM. THE FORTHCOMING EGM WILL BE CONVENED AT LAMAN PUTERI, HOTEL SINGGAHSANA PETALING JAYA, PERSIARAN BARAT OFF JALAN SULTAN, 46760 PETALING JAYA, SELANGOR, ON THURSDAY, 26 JUNE 2008, AT 1:00 P.M. OR IMMEDIATELY AFTER THE CONCLUSION OR ANY ADJOURNMENT OF THE COMPANYS EXTRAORDINARY GENERAL MEETING (IN RELATION TO, AMONGST OTHERS, THE PROPOSED REVISED PAR VALUE REDUCTION, THIS EXTRAORDINARY GENERAL MEETING BEING SCHEDULED TO BE HELD AT 12.30 P.M. OR IMMEDIATELY AFTER THE CONCLUSION OR ANY ADJOURNMENT OF THE COMPANYS 43RD ANNUAL GENERAL MEETING TO BE HELD ON THE SAME DAY AND AT THE SAME VENUE) WHICHEVER IS THE LATER. THE NOTICE OF EGM IS SET OUT IN THIS CIRCULAR. YOU ARE ADVISED TO READ AND CAREFULLY CONSIDER THE CONTENTS OF THIS CIRCULAR AND THE APPENDICES ATTACHED HERETO IN RELATION TO THE PROPOSALS BEFORE VOTING ON THE RELEVANT RESOLUTIONS AT OUR FORTHCOMING EGM. 2. DETAILS OF THE PROPOSALS 2.1 Proposed Scheme We propose to establish and implement the Proposed Scheme for the participation of all Eligible Participants as set out in the By-Laws. The Proposed Scheme will be administered by the ESS Committee to be duly appointed and authorised by our Board. The Proposed Scheme will consist of two components: (i) The Proposed Share Option Plan Under the Proposed Share Option Plan, an Eligible Participant may from time to time within the period of the Proposed Scheme, at the discretion of the ESS Committee, be offered Share Options at an offer date, subject to applicable terms and conditions. If the Eligible Participant decides to accept the offer, he/she will be granted Share Options, which can then be exercised to subscribe for new KUB Shares, at a specified price, subject to fulfilling the relevant vesting conditions and performance conditions that have been set by the ESS Committee. (ii) The Proposed Performance Share Plan Under the Proposed Performance Share Plan, our Company may from time to time within the period of the Proposed Scheme, at the discretion of the ESS Committee, invite an Eligible Participant to enter into a Performance Share Plan Agreement whereupon the Company shall agree to allot Performance Shares to the Eligible Participant at a future date, subject to fulfilling the relevant conditions that have been set by the ESS Committee.

The salient terms and conditions of the Proposed Scheme, which are governed by the By-Laws, are set out below. A copy of the draft By-Laws for the Proposed Scheme is set out in Appendix I of this Circular. 2.1.1 Eligibility Subject to the discretion of the ESS Committee, any employee or director of any corporation within our Group (excluding subsidiaries which are dormant) shall be eligible to participate in the Proposed Scheme provided that: (i) (ii) the employee has attained the age of at least 18 years; (a) in the case of a director, is on the board of directors of a corporation within our Group (excluding subsidiaries which are dormant); in the case of an employee, is employed by a corporation within our Group (excluding subsidiaries which are dormant); and

(b)

(iii)

is not a participant of any other employee share scheme implemented by any other corporation within our Group which is in force for the time being.

2.1.2

Maximum allowable allotment and basis of allocation The total number of Scheme Shares that may be issued shall not exceed in aggregate 15% of the total issued and paid-up share capital of our Company at any one time during the existence of the Proposed Scheme. Subject to any adjustments which may be made under the By-Laws, the ESS Committee shall have the absolute discretion to decide on the maximum allowable allocation in respect of each category of Eligible Participants, provided that: (a) (b) not more than 50% of the Scheme Shares should be allocated, in aggregate, to directors and senior management; and not more than 10% of the Scheme Shares should be allocated to any individual Eligible Participant who, either singly or collectively through persons connected (as defined in the Listing Requirements) to the Eligible Participant, holds 20% or more of the issued and paid-up capital of our Company.

The criteria to be applied by the ESS Committee in determining the actual entitlement of an Eligible Participant may be based on the grade of the Eligible Participant and may include, without limitations, the performance and contributions of the Eligible Participant to the continued success of our Group. For the purposes herein, senior management shall be determined at the sole and absolute discretion of the ESS Committee. The Scheme Shares are intended to be listed on the Main Board of Bursa Securities. 2.1.3 Duration and Termination of the Proposed Scheme Upon satisfaction of all the terms and conditions stipulated in the By-Laws, the effective date for the implementation of the Proposed Scheme (Effective Date) shall be the date of full compliance with all relevant requirements of the Listing Requirements, including the following: 3

(i)

submission of the final copy of the By-Laws of the Proposed Scheme to Bursa Securities pursuant to Rule 6.30F of the Listing Requirements; receipt of approval-in-principle for the issuance and listing of the Scheme Shares to be issued under the Proposed Scheme from Bursa Securities; receipt of approval from the shareholders of our Company for the Proposed Scheme; receipt of approval of any other relevant authorities, where applicable; and fulfillment of all conditions attached to the above approvals for the Proposed Scheme, if any.

(ii)

(iii) (iv) (v)

The Proposed Scheme shall be in force for a period of ten (10) years from the date of commencement of the Proposed Scheme. Notwithstanding the provisions as set out in the By-Laws, our Company may terminate the Proposed Scheme at any time during the duration of the Proposed Scheme, provided that all of the following approvals/consents have been obtained: (i) the consent of our Companys shareholders at a general meeting, wherein at least a majority of the shareholders, present and voting, vote in favour of the termination; and the written consent of all Share Option Holders who have yet to exercise their Share Options, either in part or in whole and all Performance Share Plan Participants whose Performance Share Plan Agreements are still subsisting,

(ii)

whereupon the Share Option(s) unexercised or Performance Share Plan Agreement(s) still subsisting shall be deemed to have been terminated and become null and void on the date on which the last of the approvals/consents mentioned have been obtained. 2.1.4 Share Option Price / Performance Share Price The Share Option Price may be at a discount (as determined by the ESS Committee or such other pricing mechanism as may from time to time be permitted by Bursa Securities or such other relevant regulatory authorities), provided that the discount shall not be more than 10% from the five (5)-day weighted average market price (WAMP) of KUB Shares transacted on Bursa Securities immediately preceding the offer date of the Share Option or at par value of the KUB Shares, whichever is higher. The Performance Share Price may be at a discount (as determined by the ESS Committee or such other pricing mechanism as may from time to time be permitted by Bursa Securities or such other relevant regulatory authorities) provided that the discount shall not be more than 10% from the five (5)-day WAMP of the KUB Shares transacted on Bursa Securities immediately preceding the offer date of the Performance Shares or at par value of the KUB Shares, whichever is higher.

2.1.5

Ranking of Scheme Shares The Scheme Shares to be allotted and issued upon the exercise of the Share Option or to be allotted and issued pursuant to the Performance Share Plan Agreement, shall upon such allotment and issuance, rank pari passu in all respects with the then issued and fully paid-up KUB Shares (including in relation to voting rights, whether upon any liquidation of the Company or otherwise) except that the Scheme Shares so allotted will not be entitled to any dividends, rights, allotments or other distributions, the entitlement date (namely the date as at the close of business on which shareholders must be registered in order to be entitled to any dividends, rights, allotments or other distributions) of which is prior to the date of allotment of the Scheme Shares and will be subject to all the provisions of the Articles relating to the transfer, transmission and otherwise of KUB Shares.

2.1.6

Retention period The Scheme Shares allotted and issued to a Share Option Holder or Performance Share Plan Participant may be subject to such retention period as shall be determined by the ESS Committee. A non-executive director must not sell, transfer or assign any Scheme Shares obtained under the Proposed Scheme within one year from the date of the offer of such Share Options and/or Performance Shares (as the case may be).

2.2

Proposed Amendment We propose to amend Article 158 of the Articles of our Company by adding the underlined sentence, as follows: 158. The Company in general meeting may upon the recommendation of the Directors resolve that it is desirable to capitalize any part of the amount for the time being standing to the credit of any of the Companys reserve accounts or to the credit of the profit and loss account or otherwise available for distribution, and accordingly that such sum be set free for distribution amongst the members who would have been entitled thereto if distributed by way of dividend and in the same proportions on condition that the same be not paid in cash but be applied either in or towards paying up any amounts for the time being unpaid on any shares held by such members respectively or paying up in full unissued shares or debentures of the Company to be allotted and distributed credited as fully paid up to and amongst such members in the proportion aforesaid, or partly in the one way and partly in the other, and the Directors shall give effect to such resolution. A share premium account and a capital redemption reserve may, for the purposes of this Article, be applied only in the paying up of unissued shares to be issued to members of the Company as fully paid bonus shares. Notwithstanding the above, any reserve account created pursuant to approved accounting standards may be capitalised or otherwise applied by the Directors in such manner and for such purposes as may be prescribed, contemplated or permitted by the relevant approved accounting standard(s).

3.

RATIONALE FOR THE PROPOSALS 3.1 Proposed Scheme The Proposed Scheme is intended to: (i) reward and retain the Eligible Participants whose services are considered vital to our Groups operations and continued growth of our Group. In addition, the Eligible Participants upon exercising his/ her Share Options or being allotted the Performance Shares will be able to participate directly in the future growth of our Group; motivate the Eligible Participants towards better performance through greater productivity and loyalty; and continue to attract prospective skilled and experienced employees to our Group.

(ii) (iii)

The Proposed Scheme is also extended to non-executive directors in recognition of their contribution to our Group and to enable them to participate in the future growth of the Group. In addition, such extension will enable our Group to attract and retain capable individuals to act as non-executive directors who will be responsible for making the overall strategic decisions for our Group. 3.2 Proposed Amendment The Proposed Amendment is intended to facilitate the implementation of the Proposed Scheme, and to enable flexibility in the future application of any reserve account created, as permitted by the relevant approved accounting standards. 4. UTILISATION OF PROCEEDS The proceeds to be received by our Group pursuant to the exercise of the Share Options under the Proposed Share Option Plan will depend on, amongst others, the number of Share Options exercised at the relevant point in time and the Share Option Price. As such, the amount of proceeds to be received from the exercise of the Share Options is not determinable at this juncture. However, our Company intends to utilise the proceeds from the exercise of the Share Options for its additional working capital requirements. The estimated expenses for the implementation of the Proposed Scheme is RM674,000. 5. FINANCIAL EFFECTS OF THE PROPOSALS The Proposed Amendment will have no effect on the share capital, earnings, NA, NA per share, substantial shareholders shareholdings, dividends, and gearing of our Company. The effects of the Proposed Scheme are as follows: 5.1 Share Capital The Proposed Scheme will not have an immediate effect on the existing issued and paid-up share capital of our Company. However, the issued and paid-up share capital of our Company will increase progressively depending on the number of Share Options exercised and the new KUB Shares to be issued pursuant thereto, and Performance Shares allotted and issued to the Performance Share Plan Participant.

For illustrative purposes, the effect of the Proposed Scheme on the issued and paidup share capital of the Company, assuming the completion of the Proposed Revised Par Value Reduction, could be as follows:
No. of KUB Par Shares Value Issued and paid-up share capital RM RM 556,464,690 222,585,876 33,387,881 255,973,757

As at 9 May 2008 After completion of the Proposed Revised Par Value Reduction Add: Assuming the maximum number of Scheme Shares are issued (1) Enlarged issued and paid-up share capital
Note: (1)

556,464,690 556,464,690 83,469,703 639,934,393

1.00 0.40 0.40 0.40

Representing 15% of the issued and paid-up share capital of KUB.

5.2

Earnings The Proposed Scheme will not have any effect on the earnings of our Group for the financial year ending 31 December 2008 unless Share Options are granted and/or Performance Shares Plan Agreements are entered into during the said financial year. The adoption of new Financial Reporting Standard 2 (FRS2), effective 1 January 2006, on Share-based Payment as issued by the Malaysian Accounting Standards Board, requires the recognition of an expense arising from the granting of Share Options and/or entering into the Performance Share Plan Agreements. Premised on the foregoing, our Company shall, at each date of any Share Options being granted and/or Performance Share Plan Agreements being entered into, recognise the compensation expense (measured by the fair value of the Share Options and/or Performance Shares at the offer date) (Scheme Expense). The potential effect on the earnings of the Company in the future, as a consequence of the recognition of the aforesaid Scheme Expense at each offer date, would depend on various factors affecting the fair value of the Share Options and/or Performance Shares, the quantum of which cannot be determined at this juncture. The fair value of the Share-based Payment will be considered using appropriate valuation models to be determined by the Board. The Scheme Expense relating to the Share-based Payments is recognised as an expense in the income statement over the vesting period of the Share-based Payments, with a corresponding increase in equity. The Board has taken note of the potential impact of FRS2 on the Groups earnings and shall take into consideration such impact arising from the granting of Share Options and/or entering into the Performance Share Plan Agreements.

5.3

NA and NA per Share The Proposed Scheme will not have an immediate effect on the NA and NA per share of our Group until such time whereby the Share Options are exercised and/or Performance Shares allotted and issued. The potential effect on the NA of our Group would depend on the number of Scheme Shares to be issued upon exercise of the Share Options and/or allotment and issuance of Performance Shares, and the Share Option Price.

5.4

Substantial Shareholders Shareholdings The Proposed Scheme will not have an immediate effect on the shareholdings of the substantial shareholders of our Company. Any potential effect on the shareholdings of the substantial shareholders would depend on the number of Share Options granted and exercised and/or number of Performance Shares allotted and issued at the relevant period of time, as well as the other substantial shareholders dealings in KUB Shares at any point in time. For illustrative purposes, assuming the issuance of Scheme Shares of up to 15% of the total issued and paid-up share capital of our Company, the effect on the substantial shareholders shareholdings in our Company based on the Register of Substantial Shareholders of our Company as at 9 May 2008 and assuming the completion of the Proposed Revised Par Value Reduction, is set out below.
< --------- As at 9 May 2008 --------- > < ----- Direct ----- > < -- Indirect -- > No. of % No. of % KUB KUB Shares Shares 164,844,520 29.62 125,466,950 22.55 < ----- After Proposed Scheme ----- > < ----- Direct ----- > < -- Indirect -- > No. of % No. of % KUB KUB Shares Shares 164,844,520 25.76 125,466,950 19.61 -

Gaya Edisi Sdn Bhd Minister of Finance

5.5

Dividends The Proposed Scheme is not expected to have any impact on the policy of the Board in recommending dividends, if any, to the shareholders of our Company. Future dividends to be declared shall depend on the performance, cashflow position and financing requirements of our Group.

5.6

Gearing The Proposed Scheme will not have any immediate effect on the gearing of our Group until such time when the Share Options are exercised and/or Performance Shares allotted and issued. The potential effect on the gearing will depend on the change of NA which in turn will depend on the number of Scheme Shares to be issued upon exercise of the Share Options and/or allotment and issuance of Performance Shares, and the Share Option Price.

6.

HISTORICAL KUB SHARE PRICES The monthly highest and lowest market prices of KUB Shares as traded on Bursa Securities for the past twelve (12) months are as follows:
High RM 2007 June July August September October November December 2008 January February March April May
(Source: Bloomberg)

Low RM 0.525 0.635 0.660 0.775 0.905 0.780 0.785

0.735 1.310 1.260 1.040 1.150 1.040 0.920

1.020 0.980 0.680 0.555 0.545

0.795 0.650 0.370 0.420 0.425

The last transacted price of KUB Shares on Bursa Securities on 23 May 2008, being the last transacted market price immediately prior to the announcement of the Proposals was RM0.45. The last transacted price of KUB Shares on Bursa Securities on 30 May 2008, prior to the printing of this Circular was RM0.43. 7. APPROVALS REQUIRED The Proposed Scheme is subject to approvals being obtained from the following: (i) Bursa Securities, for the listing of and quotation for the Scheme Shares to be issued pursuant to the exercise of the Share Options granted under the Proposed Share Option Plan and the allotment and issuance of Performance Shares under the Proposed Performance Share Plan; the shareholders of our Company at an EGM to be convened for the Proposed Scheme; and any other relevant regulatory authorities, where applicable.

(ii) (iii)

The Proposed Amendment is conditional upon approvals being obtained from the shareholders of our Company at an EGM to be convened. The Proposed Scheme is conditional upon the completion of the Proposed Revised Par Value Reduction, but not vice versa. The Proposed Scheme is also conditional upon the implementation of the Proposed Amendment, but not vice versa.

8.

OUTSTANDING CORPORATE IMPLEMENTATION

PROPOSALS

ANNOUNCED

BUT

PENDING

Save for the Proposals and as disclosed below, there are no outstanding corporate proposals which have been announced by our Company, but not yet completed prior to 9 May 2008 which is the latest practicable date prior to the printing of this Circular. (i) (a) Proposed reduction of the share premium account of KUB by an amount of approximately RM311.323 million pursuant to Sections 60 and 64 of the Act and for the credit arising from such reduction to be applied towards reducing the accumulated losses of our Company (Proposed Revised Share Premium Reduction); Proposed Revised Par Value Reduction; and (The Proposed Revised Share Premium Reduction and Proposed Revised Par Value Reduction are collectively referred to as the Proposed Revised Capital Rationalisation) (c) Proposed amendments to the Memorandum and Articles of Association of KUB to give effect to the Proposed Revised Capital Rationalisation (Proposed Capital Rationalisation Amendments).

(b)

Further details of the Proposed Revised Capital Rationalisation and Proposed Capital Rationalisation Amendments are set out in the announcement dated 15 May 2008, and in the Circular to you dated 4 June 2008. The Proposed Revised Share Premium Reduction, Proposed Revised Par Value Reduction and Proposed Capital Rationalisation Amendments are inter-conditional with each other. (ii) Proposed disposal of KUBs 100% equity interest in ITTAR-IPP (PJ) Sdn Bhd and KUB Singgahsana (PJ) Sdn Bhd comprising 500,000 and 1,000,000 ordinary shares of RM1.00 each in ITTAR-IPP(PJ) Sdn Bhd and KUB Singgahsana (PJ) Sdn Bhd respectively to Eden Industries Sdn Bhd, for a total cash consideration of RM3,500,000 as announced on 5 December 2007. The disposal is expected to be completed by 5 June 2008; Proposed disposal by KUB of its 38.2% equity interest comprising 2,781,310 ordinary shares of USD1.00 each in Progas Holdings Limited to Progas Energy Limited for a total cash consideration of USD5,562,620 as announced on 5 June 2007. The disposal is expected to be completed by 30 June 2008; Proposed disposal of KUB.com building by KUB Realty (PJ) Sdn Bhd, a whollyowned subsidiary of KUB to Park Residence Development Sdn Bhd for a total consideration of RM86,500,000 as announced on 31 March 2008. The disposal is expected to be completed by 28 September 2008; and Proposed disposal by Lembayung Sukma Sdn Bhd, a subsidiary of Bina Alam Bersatu Sdn Bhd, a subsidiary of KUB, of its 21 parcels of land held under various grants measuring approximately 352.165 hectares in total all in the Mukim of Belanja, District of Kinta, State of Perak to Putrajaya Resources Sdn Bhd for a total cash consideration of RM45,487,053.67 as announced on 29 February 2008. The disposal is expected to be completed by 6 August 2008.

(iii)

(iv)

(v)

10

9.

DIRECTORS AND MAJOR SHAREHOLDERS INTERESTS In accordance with the Register of Directors shareholdings as at 9 May 2008, except as disclosed below, none of our Directors, has any direct or indirect shareholdings in our Company.
< ----- Direct ----- > No. of % KUB Shares 3,000 # < -- Indirect -- > No. of % KUB Shares -

Dato Kamilia Binti Ibrahim

Note: # Negligible

All our Directors are entitled to participate in the Proposed Scheme. As such, they are deemed interested in respect of their respective entitlement under the Proposed Scheme (collectively known as Interested Directors). Hence, the Interested Directors will abstain from deliberating and voting pertaining to each of their respective entitlements under the Proposed Scheme at the relevant meetings of the Board. Likewise, the Interested Directors will also abstain from voting in respect of their shareholdings, direct or indirect in our Company (if any) on the ordinary resolutions pertaining to the Proposed Scheme as well their respective entitlements under the Proposed Scheme to be tabled at the forthcoming EGM. They will also ensure that persons connected to them (if any) will abstain from voting in respect of their shareholdings, direct or indirect in our Company (if any) on the relevant resolutions to be tabled at the forthcoming EGM. Other than the above, none of the Directors and/or major shareholders of our Company and/or persons connected with the Directors and/or major shareholders of our Company has any interest, either direct or indirect, in the Proposed Amendment and Proposed Scheme. 10. DIRECTORS RECOMMENDATION Our Directors are deemed interested in the Proposed Scheme and therefore have abstained from expressing an opinion and making any recommendation to you on the Proposed Scheme. Accordingly, our Board is presenting the ordinary resolutions in relation to the Proposed Scheme for your consideration and approval in the forthcoming EGM. After having taken into consideration the rationale for the Proposed Amendment, our Board is of the opinion that the Proposed Amendment is in the best interest of our Company. Accordingly, our Board recommends that you vote in favour of the resolution in relation to the Proposed Amendment to be tabled at the forthcoming EGM. 11. EGM We will hold an EGM, notice of which is set out in this Circular, at Laman Puteri, Hotel Singgahsana Petaling Jaya, Persiaran Barat off Jalan Sultan, 46760 Petaling Jaya, Selangor on Thursday, 26 June 2008 at 1:00 p.m. or immediately after the conclusion or any adjournment of the Companys Extraordinary General Meeting (in relation to, amongst others, the Proposed Revised Par Value Reduction, this Extraordinary General Meeting being scheduled to be held at 12.30 p.m. or immediately after the conclusion or any adjournment of the Companys 43rd Annual General Meeting to be held on the same day and at the same venue) whichever is the later. Our EGM will be held for the purpose of considering and, if thought fit, passing with or without modifications, the resolutions to give effect to the Proposals.

11

If you are unable to attend and vote in person at our forthcoming EGM, you may complete, sign and return the Form of Proxy enclosed in this Circular as soon as possible so as to arrive at the office of our Companys Share Registrar, Symphony Share Registrars Sdn Bhd, Level 26, Menara Multi-Purpose, Capital Square, No 8 Jalan Munshi Abdullah, 50100 Kuala Lumpur by hand or by fax to 03-27212530/31, not less than forty-eight (48) hours before 1:00 p.m. on the date set for holding our EGM. If you have lodged the Form of Proxy, you may also attend and vote in person at our EGM if you subsequently wish to do so. 12. FURTHER INFORMATION You are requested to refer to the attached appendices for further information. Yours faithfully On behalf of the Board of Directors KUB MALAYSIA BERHAD

DATO' NORDIN BAHARUDDIN NON-INDEPENDENT NON-EXECUTIVE DIRECTOR CHAIRMAN

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12

APPENDIX I DRAFT BY-LAWS OF THE PROPOSED SCHEME

KUB Malaysia Berhad Employees Share Scheme

1. 1.1 DEFINITIONS Except where the context otherwise requires, the following expressions in these By-Laws shall have the following meanings: Act Authorised Nominee Adviser : : : The Companies Act 1965 Has the meaning ascribed in the Central Depositories Act An investment bank or a participating organisation (under the Rules of Bursa Securities, as may be amended from time to time) that may act as a principal adviser under the Securities Commissions Policies and Guidelines on Issue/Offer of Securities (as amended from time to time) The Board of Directors of KUB Malaysia Berhad Bursa Malaysia Securities Berhad These By-Laws governing the Scheme, as may be amended from time to time Central Depository System The Securities Industry (Central Depositories) Act, 1991 A director on the board of any corporation within the KUB Group The duration of the Scheme shall be ten (10) years from the commencement of the Scheme as defined in By-Law 12 unless terminated in accordance with By-Law 13 A person who meets the criteria of eligibility for participation in the Scheme as set out in By-Law 4 The KUB Malaysia Berhad Employees Share Scheme set up and governed under these By-Laws The Employees Share Scheme committee appointed by the Board to implement and administer the Scheme in accordance with these By-Laws Such Share Option(s) (or such portion of the Share Option(s)) in which the underlying entitlement to the relevant KUB Shares have been vested in favour of the Share Option Holder and may be exercisable immediately KUB Malaysia Berhad (Company No.: 6022-D) The Company and its non-dormant Subsidiaries, collectively Ordinary share(s) of RM0.40 each in the capital of the Company

Board Bursa Securities By-Laws CDS Central Depositories Act Director Duration Scheme of the

: : : : : : :

Eligible Participant ESS or the Scheme ESS Committee

: : :

Exercisable Option(s)

Share

KUB or Company KUB Group or Group KUB Share(s) or Shares

: : :

13

APPENDIX I

Listing Requirements Market Day Maximum Allowable Allotment Offers Performance Period

: : :

Listing Requirements of Bursa Securities, as may be amended from time to time A day on which the stock market of the Bursa Securities is open for trading in securities The maximum number of new KUB Shares in respect of which Offers may be made to Eligible Participants, as provided in By-Law 5 The Share Option Offer and the Performance Share Offer The period in which the Performance Targets stipulated by the ESS Committee is required to be performed as set out in the Share Option certificate or Performance Share Plan Agreement The performance targets stipulated by the ESS Committee to be achieved during the Performance Period as set out in the Share Option certificate or Performance Share Plan Agreement In relation to the Share Option Plan and Performance Share Plan set out in Section I and Section II respectively of these By-Laws, where in relation to the allocation of the KUB Shares by reference to performance, any one or more of : (a) (b) (c) the Group; a corporation within the Group; or any business or part of the business of the Group or a corporation within the Group or any one Eligible Participant or group of Eligible Participants as may be specified by the ESS Committee

: :

Performance Targets

Performance Unit

Performance Share Plan Agreement Performance Share Allotment Date Performance Share Offer Performance Share Offer Date Performance Share Offer Period

: :

An agreement entered into between a Performance Share Plan Participant and the Company pursuant to these By-Laws The date on which the new KUB Share(s) shall be allotted to the Performance Share Plan Participant under a Performance Share Plan Agreement The offer made by the ESS Committee to Eligible Participant(s) to enter into the Performance Share Plan Agreement as set out in By-Law 30 The date on which a Performance Share Offer is made by the ESS Committee to an Eligible Participant in accordance with these By-Laws A period commencing from the Performance Share Offer Date for each Eligible Participant and expiring on a date which the ESS Committee may in its discretion decide provided that no Performance Share Offer Period shall extend beyond the Duration of the Scheme An Eligible Participant who has entered into a Performance Plan Share Agreement The plan referred to under Section II of these By-Laws

Performance Share Plan Participant Performance Share Plan

: :

14

APPENDIX I

Performance Share Price Share Option Offer

: :

The reference price of each KUB Share to be issued pursuant to a Performance Share Plan Agreement The offer made by the ESS Committee to Eligible Participant(s) to grant him/her Share Option(s) as set out in By-Law 23 The date on which a Share Option Offer is made by the ESS Committee to an Eligible Participant in accordance with these By-Laws A period commencing from the Share Option Offer Date for each Eligible Participant and expiring on a date which the ESS Committee may in its discretion decide provided that no Share Option Offer Period shall extend beyond the Duration of the Scheme The option(s) granted by the ESS Committee to an Eligible Participant in accordance with the Share Option Plan under these By-Laws An Eligible Participant who has accepted the Share Option Offer and has been granted a Share Option in accordance with these By-Laws The period in which an Exercisable Share Option may be exercised as determined by the ESS Committee in accordance with these By-Laws The plan referred to under Section I of these By-Laws The price of each underlying KUB Share comprised in the Share Option The date on which the entitlement to the relevant KUB Shares (or part thereof) shall be vested in favour of the Share Option Holder A subsidiary of the Company as defined in Section 5 of the Act Such entitlement to KUB Shares which may be vested in favour of the Share Option Holder at a future date upon the making of a determination by the ESS Committee in accordance with By-Laws 26.4 and 26.5 Such KUB Shares yet to be allotted and issued in favour of the Performance Share Plan Participant pursuant to a proposed issue of KUB Shares by the ESS Committee to the Performance Share Plan Participant in accordance with ByLaws 34.4 and 34.5 The value determined by the ESS Committee to be accorded in favour of a Performance Share Plan Participant as set out in the Performance Share Offer or Performance Share Plan Agreement, as the case may be.

Share Option Offer Date Share Option Offer Period

Share Option(s)

Share Option Holder

Share Option Period

Share Option Plan Share Option Price Share Option Vesting Date Subsidiary(ies) Unvested Option(s) Share

: : :

: :

Unvested Performance Shares

Value

15

APPENDIX I 1.2 In these By-Laws, unless the context requires otherwise: (a) (b) (c) (d) (e) Headings are for convenience only and do not affect interpretation; The singular includes the plural and vice versa; A gender includes all genders; Where a word or phrase is defined, its other grammatical forms have a corresponding meaning; A reference to any legislation, statutory provision, regulation, requirements, policies, guidelines and the like is to such legislation, statutory provision, regulation, requirements, policies, guidelines as may be amended, substituted or re-enacted from time to time.

1.3

In these By-Laws: (a) (b) If an event is to occur on a stipulated day which is not a Market Day, then the stipulated day will be taken to be the next Market Day; Any liberty or power or discretion which may be exercised or any decision or determination which may be made hereunder by the ESS Committee may be exercised in the ESS Committees absolute and unfettered discretion and the ESS Committee shall not be under any obligation to give any reasons therefor, except as may be required by the relevant authorities.

2.

NAME OF SCHEME This Scheme will be named the KUB Malaysia Berhad Employees Share Scheme and shall comprise the Share Option Plan and the Performance Share Plan.

3. 3.1

MAXIMUM NUMBER OF SHARES ALLOWABLE UNDER THE SCHEME The total number of new KUB Shares which may be available under the Scheme shall not exceed in aggregate fifteen per cent (15%) of the total issued and paid-up share capital of the Company at any one time during the existence of the Scheme PROVIDED THAT: (a) (b) Not more that fifty per cent (50%) of the KUB Shares available under the Scheme should be allocated, in aggregate, to Directors and senior management; and Not more than ten per cent (10%) of the KUB Shares available under the Scheme should be allocated to any individual Eligible Participant who, either singly or collectively through persons connected (as defined in the Listing Requirements) to the Eligible Participant, holds twenty per cent (20%) or more of the issued and paidup capital of the Company.

For the purpose for this By-Law 3.1, senior management shall be determined at the sole and absolute discretion of the ESS Committee. 3.2 Notwithstanding the provision of By-Law 3.1 nor any other provisions herein contained, in the event the maximum number of new KUB Shares issued or made available under the Share Options and Performance Share Plan Agreements granted/entered into under the Scheme exceeds the aggregate of fifteen per cent (15%) of the issued and paid-up share capital of the Company as a result of the Company purchasing its own shares in accordance with the provisions of Section 67A of the Act or undertaking any other corporate proposal which has the effect of altering its issued and paid-up capital to such extent, then such Share Options and Performance Share Plan Agreements granted/entered into under the Scheme prior to

16

APPENDIX I such alteration of the issued and paid-up capital of the Company shall remain valid and exercisable in accordance with the provisions of this Scheme. However, no further Share Option Offer(s) and/or Performance Share Plan Offer(s) shall be made to any Eligible Participants as long as the aggregate shares comprised in the number of subsisting Share Options and Performance Share Plan Agreements exceeds fifteen per cent (15%) of the issued and paid-up share capital of the Company. 3.3 The Company will, for the Duration of the Scheme, keep available sufficient authorised and unissued Shares to satisfy all outstanding Share Option(s) and Performance Share Plan Agreement(s). ELIGIBILITY Subject to the discretion of the ESS Committee, any Director or employee of any corporation within the KUB Group shall be eligible to participate in the Scheme if, as at the Share Option Offer Date or the Performance Share Offer Date (as may be applicable), the employee: (a) (b) has attained the age of eighteen (18) years: (i) (ii) (c) 4.2 in the case of a Director, is on the board of directors of a corporation within the KUB Group; in the case of an employee, is employed by a corporation within the KUB Group; and

4. 4.1

is not a participant of any other employee share option scheme implemented by any other corporation within the KUB Group which is in force for the time being.

Eligibility, however, does not confer on an Eligible Participant a claim or right to participate in the Scheme unless an offer has been made in writing by the ESS Committee to the Eligible Participant under these By-Laws and the Eligible Participant has accepted the offer in accordance with the terms of the offer and these By-Laws. An Eligible Participant is eligible to participate in either or both of the Share Option Plan and the Performance Share Plan. Where an Eligible Participant is both an employee and a Director of a corporation within the KUB Group, such Eligible Participant shall only be eligible to participate in the Scheme in such category or categories of Eligible Participant as determined by the ESS Committee. MAXIMUM ALLOWABLE ALLOTMENT AND THE BASIS OF ALLOTMENT Subject to any adjustments which may be made under By-Law 7, the ESS Committee shall have the absolute discretion to decide on the Maximum Allowable Allotment in respect of such categories of Eligible Participant. The ESS Committee shall have the absolute discretion of amending or modifying the Maximum Allowable Allotment in respect of each category whether by way of substitution, deletion or addition or such other manner as the ESS Committee may deem expedient in the administration of the Scheme, and of determining and assigning an Eligible Participant to any of the categories having regard to the criteria as referred to in By-Law 5.4. The maximum number of KUB Shares that may be offered, allotted or issued to an Eligible Participant, subject to the Maximum Allowable Allotment in the applicable category, shall be determined at the sole and absolute discretion of the ESS Committee except that the maximum number of KUB Shares that may be offered, allotted or issued to a director or chief executive officer of the Company shall be subject always to By-Law 5.5.

4.3 4.4

5. 5.1

5.2

5.3

17

APPENDIX I

5.4

The criteria to be applied by the ESS Committee in determining the actual entitlement of an Eligible Participant may be based on the grade of the Eligible Participant and may include, without limitations, performance, contributions, dedication and loyalty of the Eligible Participant and the potential worth of the Eligible Participant in terms of further contribution to the continued success of the Group. Notwithstanding anything set out in these By-Laws, no KUB Shares shall be offered, allotted or issued to any Director of the Company or person(s) connected (as defined in the Listing Requirements) with such director or chief executive officer unless the shareholders of the Company have approved the specific allotment to the said director or chief executive officer of the Company or persons connected and subject to compliance with the Listing Requirements. Nothing herein shall prevent the ESS Committee from making any Share Option Offer and/or Performance Share Offer subject always to By-Law 5.1. In the circumstances where the maximum allowable allotment as provided in the Listing Requirements on employee share schemes is amended by Bursa Securities from time to time, the ESS Committee shall have the discretion to make the necessary adjustments so that the number of new KUB Shares comprised in the Share Option Offer and Performance Share Offer that may be offered to any one of the Eligible Participants shall be in accordance with the provisions of the Listing Requirements prevailing during the Share Option Period and the subsistence of the Performance Share Plan Agreement. RETENTION PERIOD The new KUB Shares to be allotted and issued to a Share Option Holder or Performance Share Plan Participant pursuant to these By-Laws may be subject to such retention period as shall be determined by the ESS Committee. A non-executive Director must not sell, transfer or assign any KUB Shares obtained through the exercise of Share Options and/or obtained pursuant to Performance Share Plan Agreements under the Scheme within one (1) year from the relevant Share Option Offer Date and/or Performance Share Offer Date (as the case may be). ALTERATION OF SHARE CAPITAL DURING THE SCHEME PERIOD Notwithstanding anything set out in these By-Laws, the ESS Committee may make or provide for such adjustments in the Share Option Price, Performance Share Price and/or in the number of underlying KUB Shares comprised in the outstanding Share Option(s) and/or Performance Share Plan Agreement(s) as the ESS Committee in its discretion, in good faith, may determine to be equitable in order to prevent dilution or enlargement of the rights of any Share Option Holder and/or Performance Share Plan Participant that would otherwise result from any alteration in the capital structure of the Company during the Share Option Period or during the subsistence of the Performance Share Plan Agreement, whether by way of capitalisation of profits or reserves, rights issue, bonus issue, reduction of capital, subdivision or consolidation of KUB Shares, or otherwise howsoever arising, and a corresponding adjustment (if any) shall be made either in the number of underlying KUB Shares comprised in the Share Option and/or Performance Share Plan Agreement so far as unexercised or unallotted and/or the Share Option Price and/or Performance Share Price, in such manner as the ESS Committee may decide. In the event of any such transaction or event as referred to in By-Law 7.1, the ESS Committee, in its discretion, may provide in substitution for any or all outstanding Share Option(s) and/or KUB Shares to be issued pursuant to Performance Share Plan Agreement(s) under the Scheme such alternatives as it, in good faith, may determine to be equitable in the circumstances and may require in connection therewith the surrender, cancellation or termination of all outstanding Share Option(s) or Performance Share Plan Agreement(s). If

5.5

5.6 5.7

6. 6.1

6.2

7. 7.1

7.2

18

APPENDIX I the ESS Committee decides that no adjustments will be made, the ESS Committee shall inform the Share Option Holders and Performance Share Plan Participants of this decision through an announcement to all Directors and employees of the Group to be made in such manner deemed appropriate by the ESS Committee. 7.3 Subject to By-Law 7.5, any adjustment in the number of underlying KUB Shares comprised in outstanding Share Option(s) and/or Performance Share Plan Agreement(s) shall comply with the requirements of any applicable statutes, rules, regulations and/or conditions issued by the relevant authorities and shall, where appropriate, give each Share Option Holder and/or Performance Share Plan Participant the same proportion of the issued ordinary share capital of the Company as that to which he/she was previously entitled by ensuring that the capital outlay or value to be contributed by each Share Option Holder and/or Performance Share Plan Participant (where applicable) for the underlying KUB Shares remains unaffected. The provisions of this By-Law shall not apply where the alteration in the capital structure of the Company arises from: (i) an issue of new KUB Shares, or other securities/rights convertible into KUB Shares, in consideration or part consideration for an acquisition of any other securities, assets or business; a special issue of new KUB Shares to Bumiputera investors nominated by the Ministry of International Trade and Industry, Malaysia and/or any other government authority to comply with Government policy on Bumiputera capital participation; a private placement or restricted issue of new KUB Shares by the Company; a share buy-back arrangement by the Company; any issue of warrants, convertible loan stocks or other instruments by the Company that gives a right of conversion into new Shares, and any issue of new Shares arising from the exercise of any conversion rights attached to such convertible securities; or an issue of new KUB Shares upon the exercise of Share Options, pursuant to the Share Option Plan, and/or pursuant to Performance Share Plan Agreements.

7.4

(ii)

(iii) (iv) (v)

(vi) 7.5

An adjustment pursuant to this By-Law shall be made in accordance with the formulae as set out in the First Schedule attached to these By-Laws and on the day immediately following the books closure date for the event giving rise to the adjustment. If an event occurs that is not set out within the First Schedule, the ESS Committee may agree to an adjustment subject to the provision of By-Law 7.3 provided that the Share Option Holders and Performance Share Plan Participants shall be notified of the adjustment pursuant to By-Law 7.6 through an announcement to all Directors and employees of the Group to be made in such manner deemed appropriate by the ESS Committee. Upon any adjustment being made pursuant to this By-Law, the ESS Committee shall within thirty (30) days of the effective date of the alteration in the capital structure of the Company or such other period as deemed appropriate by the ESS Committee, notify the Share Option Holders and/or Performance Share Plan Participants (or his/her legal or personal representatives where applicable) in writing informing him/her of the Share Option Price and/or Performance Share Price thereafter in effect and the adjusted number of underlying KUB Shares comprised in the outstanding Share Option(s) and/or Performance Share Plan Agreement(s). The provisions of this By-Law 7 shall apply to a situation where the Share Option Offer Period and the Performance Share Offer Period have not lapsed and the said Share Option Offer or Performance Share Offer (where applicable) has not been accepted by the Eligible Participant or withdrawn by the ESS Committee.

7.6

7.7

19

APPENDIX I 8. 8.1 QUOTATION OF KUB SHARES The new KUB Shares to be allotted and issued to the Share Option Holders and/or Performance Share Plan Participants will not be listed or quoted on the Bursa Securities until the Share Option is exercised or the KUB Shares allotted under a Performance Share Plan Agreement pursuant to these By-Laws has been accepted whereupon the Company shall make the necessary application to the Bursa Securities for the listing of and quotation for such KUB Shares and use its best endeavours to obtain such approval of the Bursa Securities. Pursuant to By-Law 8.1, the Company shall within 8 Market Days from receipt of the notice of exercise of the Share Option (together with the requisite remittance) pursuant to these ByLaws, allot and issue the relevant number of KUB Shares specified in the said notice, dispatch or cause to be dispatched the notice of allotment to the Share Option Holder and make an application for the quotation of KUB Shares subject to the provisions to the Articles of Association of the Company and the Listing Requirements. The allotment and issue of the relevant number of KUB Shares to a Performance Share Plan Participant pursuant to a Performance Share Plan Agreement, and the making of the application for quotation of those KUB Shares, shall be within such timeframe as may be determined by the ESS Committee and reflected in the Performance Share Plan Agreement. The Company shall deposit or cause to be deposited the new KUB Shares directly into the Share Option Holder/Performance Share Plan Participants CDS account or Authorised Nominees CDS Account accordingly but subject to the provisions of the Articles of Association of the Company. No physical share certificate will be issued. KUB, any corporation within the Group, the board of directors of KUB and/or the ESS Committee shall not under any circumstances be held liable or responsible for any costs, losses and damages whatsoever and howsoever relating to the delay on the part of KUB in allotting or issuing the KUB Shares or in procuring the consents of the Bursa Securities to list the KUB Shares for which the Share Option Holder and/or Performance Share Plan Participant is entitled. RANKING OF NEW KUB SHARES The new KUB Shares to be allotted and issued upon the exercise of the Share Option or to be allotted and issued pursuant to the Performance Share Plan Agreement, shall upon such allotment and issuance, rank pari passu in all respects with all the other issued and fully paidup KUB Shares (including in relation to voting or other rights, whether upon any liquidation of the Company or otherwise) except that the new KUB Shares so allotted will not be entitled to any dividends, rights, allotments or other distributions, the entitlement date (namely the date as at the close of business on which shareholders must be registered in order to be entitled to any dividends, rights, allotments or other distributions) of which is prior to the date of allotment of the new KUB Shares and will be subject to all the provisions of the Articles of Associations relating to the transfer, transmission and otherwise of the KUB Shares. 10. 10.1 ADMINISTRATION The Scheme shall be administered by the ESS Committee consisting of such persons as may be appointed by the Board from time to time. The ESS Committee shall administer the Scheme in such manner as it shall in its discretion deem fit. For the purpose of administering the Scheme, the ESS Committee may do all such acts and things and enter into any transactions, agreements, deeds, documents or arrangements, and make rules, regulations or impose terms and conditions or delegate part of its power relating to the administration of the Scheme, as the ESS Committee may in its discretion deem fit necessary and/or expedient for the implementation of the Scheme. The Board shall:

8.2

8.3

9.

10.2

20

APPENDIX I (a) (b) have the discretion as it deems fit to approve, rescind and/or revoke the appointment of any person in the ESS Committee; have the power at any time and from time to time to assume and/or exercise or execute any of the powers and authorities conferred upon the ESS Committee pursuant to these By-Laws.

11. 11.1

AMENDMENT AND/OR MODIFICATION TO THE SCHEME Subject to the approvals of any relevant authorities, the Board shall have the power at any time and from time to time by resolution to amend and/or modify all or any of the provisions of the Scheme PROVIDED THAT no such amendment and/or modification shall be made which would either materially prejudice the rights attached to any Share Option or Performance Share Plan Agreement without the approval of the Share Option Holders and/or the Performance Share Plan Participants (as may be relevant in the circumstances) in the following manner: (i) (ii) if voting by show of hands, a simple majority of those present and voting for each group; or if voting by poll, a simple majority of those present and voting for each group whose votes shall be calculated as one (1) vote for each KUB Share comprised in their respective Share Options or Performance Share Plan Agreements. For the avoidance of doubt, all KUB Shares comprised in the Share Options or Performance Share Plan Agreements shall be taken into account regardless whether the KUB Shares have been vested/allotted or not under these By-Laws.

11.2 11.3

The quorum for each meeting of the Share Option Holders or Performance Share Plan Participants shall be two (2). In the event the adverse effect of a proposed amendment or modification shall be exclusive only to the Share Option Holders or the Performance Share Plan Participants, as the case may be (Affected Group), without affecting the other group, a meeting held in accordance with By-Laws 11.1 and 11.2 to obtain only the consent of that Affected Group would be sufficient without having to hold a meeting to obtain the approval of the other group not affected by the proposed amendments or modification. Notwithstanding anything set out in these By-Laws, where any proposed amendment or modification has the effect of altering the Scheme to the advantage of any Share Option Holder and/or Performance Share Plan Participant (in relation to the matters set out in items (1) to (8) of Appendix 6F of the Listing Requirements), such amendment or modification shall only be made with the prior approval of the Companys shareholders in a general meeting. EFFECTIVE DATE AND DURATION OF THE SCHEME The effective date of the commencement of the Scheme shall be the date of full compliance with the Listing Requirements in relation to employees share schemes including the following: (i) (ii) submission of a final copy of the By-Laws to Bursa Securities; receipt of approval-in-principle for the listing of and quotation for the new KUB Shares to be issued pursuant to the exercise of the Share Options and/or pursuant to the Performance Share Plan Agreements from Bursa Securities; receipt of approval from the shareholders of the Company for the Scheme; receipt of approval from any other relevant authorities (if any), where applicable; and

11.4

12. 12.1

(iii) (iv)

21

APPENDIX I (v) 12.2 fulfilment of all the conditions attached to the above approvals for the Scheme, if any.

The Scheme shall be in force for a period of ten (10) years from the date of commencement of the Scheme. TERMINATION OF THE SCHEME Notwithstanding the provisions of By-Law 12, the Scheme may be terminated by the Company at any time during the Duration of the Scheme provided the following approval(s)/consent(s) are obtained: (i) the consent of the shareholders of the Company at a general meeting, wherein at least a majority of the shareholders, present and voting, vote in favour of the termination; and the written consent of all Share Option Holders who have yet to exercise their Share Options, either in part or in whole and all Performance Share Plan Participants whose Performance Share Plan Agreements are still subsisting,

13.

(ii)

whereupon the Share Option(s) unexercised or Performance Share Plan Agreement(s) still subsisting shall be deemed to have been terminated and become null and void on the date on which the last of the approvals/consents mentioned have been obtained. 14. DISPUTES In the event of any dispute or difference in opinion between the ESS Committee with an Eligible Participant or Share Option Holder or Performance Share Plan Participant, as to any matter or thing of any nature arising under these By-Laws or in connection with the Scheme: (a) the ESS Committee shall determine such dispute or difference by a written decision (without any obligation to give any reasons therefor) given to the Eligible Participant or Share Option Holder or Performance Share Plan Participant, as the case may be; the above decision of the ESS Committee shall be final and binding on the parties unless the Eligible Participant or Share Option Holder or Performance Share Plan Participant, as the case may be, shall dispute the decision by written notice to the ESS Committee within fourteen (14) days of the receipt of the written decision, in which case such dispute or difference shall be referred to the decision of the external auditors of the Company for the time being or any other suitably qualified independent party appointed by the Company for this purpose, acting as experts and not as arbitrators, whose decision shall be final and binding in all respects; and in the event that the external auditors or other suitably qualified independent party referred to above, are unable to reach a decision in respect of the dispute, such dispute shall be referred to a court of law of competent jurisdiction in Malaysia, whose decision shall be final and binding in all respects.

(b)

(c)

15. 15.1

COMPENSATION An Eligible Participant or Share Option Holder or Performance Share Plan Participant who ceases to hold office or employment shall not be entitled to any compensation for the loss of any right or benefit or prospective right or benefit under the Scheme which he might otherwise have enjoyed whether such compensation is claimed by way of damages for wrongful dismissal or other breach of contract or by way of compensation for loss of office. No Eligible Participant or Share Option Holder or Performance Share Plan Participant or legal or personal representatives shall bring any claim, action or proceeding against the Company, the

15.2

22

APPENDIX I Board, the ESS Committee or any other party for compensation, loss or damages whatsoever and howsoever arising from the suspension of his rights to exercise his Share Option and/or under his Performance Share Plan Agreement, or his Share Option and/or Performance Share Plan Agreement ceasing to be valid pursuant to the provisions of these By-Laws, as may be amended from time to time in accordance with these By-Laws. 16. TRANSFERS FROM OTHER CORPORATIONS TO THE GROUP In the event that: (a) a director or an employee who was employed in a corporation related to the Company pursuant to Section 6 of the Act (being a corporation that is not a subsidiary of the Company) and is subsequently transferred from such corporation to any corporation within the Group; or a director or an employee who was in the employment of a corporation which subsequently becomes a subsidiary of the Company as a result of a restructuring or acquisition or other exercise involving the Company and/or any corporation within the Group;

(b)

(the first mentioned corporation in each of (a) and (b) is hereinafter referred to as the Previous Corporation), such an employee of the Previous Corporation (the Affected Employee) will, if the Affected Employee satisfies all the conditions of these By-Laws, be eligible to participate in the Scheme provided that the Affected Employee: (a) may be entitled to exercise all such unexercised option(s) which were granted to him/her under any share scheme (if any) which he/she was participating in the Previous Corporation (hereinafter referred to as Previous Corporations Scheme) whilst the Affected Employee was in the employment of the Previous Corporation, if the same is provided for under the by-laws of such Previous Corporations Scheme but he/she shall not, upon such transfer or restructuring or other exercise, as the case may be, be eligible to participate for further Share Option(s) of such Previous Corporations Scheme; and will only be eligible to participate in the Scheme for its remaining duration.

(b) 17.

DIVESTMENT FROM THE GROUP If a Share Option Holder or Performance Share Plan Participant who was in the employment with a corporation within the Group which subsequently ceased to be a corporation falling within the definition of the Group as a result of divestment, then the ESS Committee may, on such terms and conditions as may be set out: (a) if there remains Unvested Share Options or Unvested Performance Shares, allow for such number of KUB Shares to be immediately vested, allotted and issued (as the case may be) in favour of the Share Option Holder or the Performance Share Plan Participant; if, in relation to a Share Option or Performance Share Plan Agreement where a determination pursuant to By-Laws 26.4 and 26.5 or By-Laws 34.4 and 34.5 respectively has yet to be made, make a determination based on the Share Option Holders or Performance Share Plan Participants level of achievement respectively on the date of divestment to vest or issue such number of KUB Shares as the ESS Committee deems appropriate.

(b)

23

APPENDIX I 18. COSTS AND EXPENSES All costs and expenses incurred in relation to the administration of the Scheme including but not limited to the costs and expenses relating to the allotment and issue of the new KUB Shares upon the exercise of any Share Option or allotment of KUB Shares under a Performance Share Plan Agreement shall be borne by the Company. 19. NOT A TERM OF EMPLOYMENT This Scheme does not form part of or in any way be construed as forming part of the terms and conditions of employment of any employee. This Scheme shall not confer or be construed to confer on any employee any special rights or privileges over the employees terms and conditions of employment in the KUB Group nor any rights in addition to compensation or damages that the employee may be normally entitled to arising from the cessation of such employment. 20. ARTICLES OF ASSOCIATION Notwithstanding the terms and conditions contained in this Scheme, if a situation of conflict should arise between this Scheme and the Articles of Association of the Company, the provisions of the Articles of Association of the Company shall at all times prevail. 21. INSPECTION OF THE AUDITED FINANCIAL STATEMENTS All Share Option Holders and Performance Share Plan Participants are entitled to inspect the latest audited financial statements of the Company during normal office hours on any working day at the registered office of the Company. 22. TAXES Each Share Option Holder or Performance Share Plan Participant shall be solely responsible for any income or other taxes which may be levied on him/her arising out of or as a result of the exercise of his/her Share Options(s) as Share Option Holder and/or allotment and issuance of KUB Shares pursuant to the Performance Share Plan Agreement(s).

[The remainder of this page is intentionally left blank.]

24

APPENDIX I SECTION I: SHARE OPTION PLAN 23. 23.1 SHARE OPTION OFFER The ESS Committee may, within the Duration of the Scheme, at its discretion make a Share Option Offer to any Eligible Participant whom the ESS Committee may in its discretion select, to subscribe during the Share Option Period for KUB Shares. Nothing herein shall prevent the ESS Committee from making more than one Share Option Offer to any Eligible Participant PROVIDED ALWAYS THAT the total aggregate number of KUB Shares to be allotted to any Eligible Participant (inclusive of KUB Shares allotted pursuant to previous Share Option Offers under the Scheme, if any) shall not exceed the Maximum Allowable Allotment of each Eligible Participant. Each Share Option Offer shall be made in writing by the ESS Committee. Each Share Option Offer may include the following particulars in the letter of offer: (a) maximum number of KUB Shares which the Eligible Participant shall be entitled to subscribe for upon the exercise of the Share Option after satisfying the conditions set out in the Share Option; Share Option Period; Share Option Price; Share Option Offer Date; Share Option Offer Period; Performance Target; and Performance Period.

23.2

23.3 23.4

(b) (c) (d) (e) (f) (g) 24. 24.1

SHARE OPTION PRICE The price at which a Share Option Holder is entitled to subscribe for or acquire each KUB Share may be at a discount (as determined by the ESS Committee or such other pricing mechanism as may from time to time be permitted by Bursa Securities or such other relevant regulatory authorities), provided that the discount shall not be more than 10% from the five (5) days weighted average market price of the KUB Shares transacted on the Bursa Securities immediately preceding the Share Option Offer Date of the Share Option or at par value of the KUB Shares, whichever is higher. ACCEPTANCE OF THE SHARE OPTION OFFER The Share Option Offer shall be valid for acceptance during the Share Option Offer Period. The acceptance of a Share Option Offer shall be made by way of a written notice from the Eligible Participant to the ESS Committee in the form prescribed by the ESS Committee from time to time. In the event that the Eligible Participant fails to accept the Share Option Offer within the prescribed period, the Share Option Offer shall automatically lapse and shall then be null and void PROVIDED THAT the ESS Committee shall not be precluded from making a new Share Option Offer to the Eligible Participant subsequently. Acceptance of the Share Option Offer by an Eligible Participant shall be accompanied by the payment of Ringgit Malaysia One (RM1.00) as non-refundable consideration for the grant of the Share Option.

25. 25.1

25.2

25

APPENDIX I 25.3 Within thirty (30) days after the due acceptance of the Share Option Offer in accordance with the provisions of this By-Law, the ESS Committee shall issue to the Share Option Holder a certificate of Share Option in such form as may be determined by the ESS Committee from time to time. The Share Option may include in the certificate, the following: (a) (b) (c) (d) (e) (g) (f) 25.4 maximum number of KUB Shares entitled to be subscribed for upon an exercise of the Share Option upon satisfying the conditions set out in the Share Option; Share Option Period; Share Option Price; Date of grant of Share Option; Performance Target; Performance Period; and the Share Option shall be subject to the terms of these By-Laws.

Unless otherwise provided in these By-Laws, a Share Option shall be personal to the Share Option Holder and cannot be assigned, transferred or otherwise disposed of in any manner whatsoever unless By-Laws 27.3, 28.2 or 29.2 applies. EXERCISE OF SHARE OPTION(S) The ESS Committee may at its discretion stipulate the Performance Targets, Performance Period and/or other conditions deemed appropriate. The ESS Committee shall procure that each Share Option Holder is notified of such Performance Targets, the Performance Period or other conditions that will be used to determine the number of KUB Shares which are entitled to be vested to him/her on any Share Option Vesting Date PROVIDED THAT there may be excluded from such notice any information the disclosure of which the ESS Committee reasonably consider would prejudice confidentiality. The ESS Committee may, by giving notice in writing to Share Option Holders, vary or waive the terms of any Performance Targets, Performance Period or other conditions as will be used to determine the number of KUB Shares which are entitled to be vested on such Share Option Holders on any Share Option Vesting Shares Date, PROVIDED THAT: (a) the consequence of any such variation on the revised Performance Targets, Performance Period or other conditions is no more difficult to satisfy than would have been the case had the variation not been made; if different Performance Targets, Performance Period or other conditions have been specified in relation to different Performance Unit(s), the likelihood of each Performance Unit meeting the revised Performance Target, Performance Period or other condition set in relation to that Performance Unit must be no less that it would have been had the variation not been made; and no such variation shall have effect unless one or more events have occurred which cause the ESS Committee, acting fairly and reasonably, to consider that a different condition would be a fairer measure of performance.

26. 26.1 26.2

26.3

(b)

(c)

26.4

The determination whether the Share Option Holder has achieved the stipulated conditions or his/her Performance Targets during the Performance Period shall be determined by the ESS Committee at its absolute discretion.

26

APPENDIX I 26.5 Based on the determination pursuant to By-Law 26.4, the ESS Committee shall determine the number of KUB Shares which are entitled to be vested on that Share Option Holder subject to the maximum number of shares set out in that Share Option Holders Share Option and subject to By-Law 4. As soon as practicable after a relevant determination is made pursuant to By-Laws 26.4 and 26.5, the ESS Committee shall notify each Share Option Holder the: (a) (b) (c) (d) (e) (f) 26.7 number of KUB Shares which are entitled to be vested to him/her; the retention period for those KUB Share (if any); Share Option Vesting Date (where applicable); Share Option Offer Price; Share Option Period; and any other conditions of the vesting of the KUB Shares.

26.6

Subject to By-Law 26.8, an Exercisable Share Option may be exercised by the Share Option Holder by notice in writing to the Company through the ESS Committee in the prescribed form from time to time during the Share Option Period in respect of all or any part of the underlying KUB Shares comprised in the Share Option, provided that where an Exercisable Share Option is exercised in respect of a part of the underlying KUB Shares, the number of KUB Shares of which such Exercisable Share Option may be exercised shall not be less that one hundred (100) and shall be in multiples of one hundred (100) other than in the case of the final exercise by the Share Option Holder under the Share Option. The partial exercise of an Exercisable Share Option shall not preclude the Share Option Holder from exercising the Exercisable Share Option for the remaining duration of the Share Option Period in respect of the balance of the underlying KUB shares comprised in the Share Option.

26.8

Subject to By-Law 5, the ESS Committee may, at any time and from time to time, after a Share Option is granted, permit a Share Option Holder to exercise one hundred per cent (100%) of his/her Share Option(s) at any time during the Share Option Period. Every notice referred to in By-Law 26.7 must be in such form prescribed by the ESS Committee from time to time and accompanied by a remittance for the full amount of the subscription monies for the KUB Shares in respect of which notice is given. A Share Option Holder who exercises his/her Exercisable Share Option shall provide the ESS Committee with his/her CDS account number or the CDS account number of his/her Authorised Nominee, as the case may be, in the notice referred to in By-Law 26.7. No Exercisable Share Option(s) shall be exercisable after the expiry of the Share Option Period. In the event that a Share Option Holder is subject to disciplinary proceedings (whether or not such disciplinary proceedings will give rise to a dismissal or termination of service) the ESS Committee may, in its discretion, suspend the right of the Share Option Holder to exercise his/her Exercisable Share Option pending the outcome of such disciplinary proceedings. The ESS Committee may impose such terms and conditions as the ESS Committee shall deem appropriate having regard to the nature of the charges made or brought against the Share Option Holder and the outcome of such disciplinary proceedings PROVIDED ALWAYS THAT in the event that such Share Option Holder shall subsequently be found to be not guilty of the charges which gave rise to such disciplinary proceedings, the ESS Committee shall reinstate the rights of such Share Option Holder to exercise his Exercisable Share Option PROVIDED THAT such reinstatement is within the duration of the Scheme in accordance with By-Law 12.

26.9

26.10

26.11 26.12

27

APPENDIX I

26.13

Subject to the discretion of the ESS Committee, failure by the Share Option Holder to comply with the procedure for an exercise of an Exercisable Share Option as stipulated in By-Laws 26.7 and 26.10 will invalidate the purported exercise of such Exercisable Share Option by an Eligible Participant. Every Share Option shall be subject to the condition that no KUB Shares shall be allotted and issued to a Share Option Holder pursuant to the exercise of a Share Option if such allotment and issue would be contrary to any law, enactment, rules and/or regulations of any regulatory body which may be in force during the Share Option Period. TERMINATION OF SHARE OPTION(S) Subject to By-Laws 27.2 and 27.3, all unexercised Share Option(s) or such unexercised portion of Share Option(s) shall forthwith lapse and/or be deemed to be cancelled and cease to be exercisable in relation to any KUB Shares upon the occurrence of one or more of the following events: (a) (i) (ii) (b) (c) in the case of a Director, the Share Option Holder ceasing to be a Director; and/or in the case of an employee, the Share Option Holder ceasing to be in employment with a corporation within the KUB Group; or

26.14

27. 27.1

in the event of the liquidation of KUB; or in the event of bankruptcy of the Share Option Holder.

27.2

In the event of the cessation of a Share Option Holder as a Director and/or employee upon the occurrence of any of the following: (a) (b) (c) (d) (e) (f) retirement on attaining the retirement age under the Groups retirement policy; retirement before attaining the normal retirement age; expiry of service contract; redundancy; ill-health, injury, physical or mental disability; or any other circumstances which are acceptable to the ESS Committee;

the ESS Committee may, at its discretion, (i) (ii) if there remains Unvested Share Options, allow for such number of KUB Shares to be immediately vested on that Share Option Holder; if in relation to an Exercisable Share Option, allow the exercise of such Share Options within such period as may be specified by the ESS Committee following the occurrence of the relevant cessation event; or if in relation to a Share Option where a determination pursuant to By-Laws 26 and 26.5 has yet to be made, make such determination based on that Share Option Holders lever of achievement and vest such number of KUB Shares as the ESS Committee deems appropriate,

(iii)

and approve in writing the exercise or partial exercise of such Share Option(s) upon such terms and conditions as may be set out by the ESS Committee.

28

APPENDIX I

27.3

In the event of death of a Share Option Holder, the ESS Committee may, at its discretion, (i) (ii) if there remains Unvested Share Options, allow for such number of KUB Shares to be immediately vested; if in relation to an Exercisable Share Option, allow the exercise of such Share Options within such period as may be specified by the ESS Committee following the death of a Share Option Holder; or if in relation to a Share Option where a determination pursuant to By-Laws 26.4 and 26.5 has yet to be made, make such determination based on that Share Option Holders level of achievement and vest such number of KUB Shares as the ESS Committee deems appropriate.

(iii)

and approve in writing the exercise or partial exercise by the legal or personal representatives of that Share Option Holder within the Share Option Period upon such terms and conditions as set out by the ESS Committee. 28. 28.1 TAKEOVER In the event of: (i) a takeover offer being made for the Company through a general offer to acquire the whole of the issued share capital of the Company (or such part hereof not at the time owned by the person making the general offer (Offeror) or any persons acting in concert with the Offeror); or the Offeror becoming entitled or bound to exercise the right of compulsory acquisition of KUB Shares under the provisions of any applicable statutes, rules and/or regulations and gives notice to the Company that it intends to exercise such right on a specific date;

(ii)

the ESS Committee may, upon such terms and conditions as may be set out, (a) (b) if there remain Unvested Share Option(s), allow for such number of KUB Shares to be immediately vested in favour of the Share Option Holder; if, in relation to a Share Option where a determination pursuant to By-Laws 26.4 and 26.5 has yet to be made, make such determination based on the Share Option Holders level of achievement and vest such number of KUB Shares as the ESS Committee deems appropriate.

28.2 28.3

In the event of death of the Share Option Holder during the circumstances set out in By-Law 28.1, By-Law 27.3 shall apply. Any Share Option or part of a Share Option which remains unexercised after the expiry of the periods stipulated in the aforesaid circumstances in this By-Law 28 shall thereafter lapse and no longer be exercisable. SCHEME OF ARRANGEMENT, AMALGAMATION, RECONSTRUCTION, ETC. In the event of the court sanctioning a compromise or arrangement between the Company and its members proposed for the purposes of, or in connection with, a scheme of arrangement and reconstruction of the Company, or its amalgamation with any other company or companies, the ESS Committee may, upon such terms and conditions as may be set out,

29. 29.1

29

APPENDIX I (a) (b) if there remains any Unvested Share Option, allow for such number of KUB Shares to be immediately vested in favour of the Share Option Holder; if, in relation to a Share Option where a determination pursuant to By-Laws 26.4 and 26.5 has yet to be made, make such determination based on the Share Option Holders level of achievement and vest such number of KUB Shares as the ESS Committee deems appropriate.

29.2 29.3

In the event of death of the Share Option Holder during the circumstances set out in By-Law 29.1, By-Law 27.3 shall apply. Any Share Option or part of a Share Option which remains unexercised after the expiry of the period stipulated in the aforesaid circumstances shall thereafter lapse and shall no longer be exercisable. [The remainder of this page is intentionally left blank.]

30

APPENDIX I SECTION II: PERFORMANCE SHARE PLAN 30. 30.1 PERFORMANCE SHARE OFFER The ESS Committee may make an offer under which: (a) the ESS Committee shall (where applicable), specify the Performance Targets, Performance Period, Value and/or other conditions in respect of the Eligible Participant; the ESS Committee shall specify the Performance Share Price and number of KUB Shares which may be allotted to the Eligible Participant; invite such Eligible Participant to enter into the Performance Share Plan Agreement whereupon the ESS Committee shall agree to allot and issue KUB Shares to the Eligible Participant in consideration of the Eligible Participant satisfying the conditions set out in the Performance Share Plan Agreement and these By-Laws.

(b) (c)

30.2

Nothing herein shall prevent the ESS Committee from making more than one Performance Share Offer pursuant to By-Law 30.1 to any Eligible Participant PROVIDED ALWAYS THAT the total aggregate number of KUB Shares to be allotted to any Eligible Participant shall not exceed the Maximum Allowable Allotment of each Eligible Participant. The Performance Share Offer under this By-Law shall be made in writing by the ESS Committee. ENTRY INTO A PERFORMANCE SHARE PLAN AGREEMENT The Performance Share Offer shall be valid for acceptance for the Performance Share Offer Period. The acceptance of the Performance Share Offer shall be made by way of written notice from the Eligible Participant to the ESS Committee in the form prescribed by the ESS Committee from time to time. In the event that the Eligible Participant fails to accept the Performance Share Offer within the prescribed period, the Performance Share Offer shall automatically lapse and shall then be null and void PROVIDED THAT the ESS Committee shall not be precluded from making a new Performance Share Offer to the Eligible Participant subsequently. The rights of the Performance Share Plan Participant under the Performance Share Plan Agreement shall be personal to the Performance Share Plan Participant and cannot be assigned, transferred or otherwise disposed of in any manner whatsoever unless By-Laws 35.3. 36.2 or 37.2 applies. PERFORMANCE SHARE PRICE The Performance Share Price for each underlying KUB Share may be at a discount (as determined by the ESS Committee or such other pricing mechanism as may from time to time be permitted by Bursa Securities or such other relevant regulatory authorities) provided that the discount shall not be more than 10% from the five (5) day weighted average market price of the KUB Shares transacted on the Bursa Securities immediately preceding the Performance Share Offer Date or at par value of the KUB Shares, whichever is higher. TERMS OF A PERFORMANCE SHARE PLAN AGREEMENT A Performance Share Plan Agreement may include the following: (a) (b) Value; Performance Share Price;

30.3

31. 31.1

31.2

32. 32.1

33.

31

APPENDIX I (c) (d) (e) (f) (g) Maximum number of KUB Shares to be issued under the Performance Share Plan Agreement; Performance Targets; Performance Period; Performance Share Allotment Date; and the Performance Share Plan Agreement shall be subject to the terms of these ByLaws.

34. 34.1 34.2

ALLOTMENT OF KUB SHARES The ESS Committee may at its discretion stipulate the Performance Targets, Performance Period, Value and/or other conditions. The ESS Committee shall procure that each Performance Share Plan Participant is notified of such Performance Targets, Performance Period or other conditions that will be used to determine the number of KUB Shares allotted to him/her on any Performance Share Allotment Date PROVIDED THAT there may be excluded from such notice any information the disclosure of which the ESS Committee reasonably consider would prejudice confidentiality. The ESS Committee may, by giving notice in writing to the Performance Share Plan Participants, vary or waive the terms of any Performance Targets, Performance Period or other conditions as will be used to determine the number of KUB Shares issued to such Performance Share Plan Participants on any Performance Share Issue Date, PROVIDED THAT: (a) the consequence of any such variation on the revised Performance Targets, Performance Period or other conditions is no more difficult to satisfy than would have been the case had the variation not been made; if different Performance Targets, Performance Period or other conditions have been specified in relation to different Performance Unit(s), the likelihood of each Performance Unit meeting the revised Performance Target or Performance Period set in relation to that Performance Unit must be no less than it would have been had the variation not been made; and no such variation shall have effect unless one or more events have occurred which cause the ESS Committee, acting fairly and reasonably, to consider that a different condition would be a fairer measure of performance.

34.3

(b)

(c)

34.4

The determination whether the Performance Share Plan Participant has achieved the stipulated conditions or his/her Performance Targets during the Performance Period shall be determined by the ESS Committee at its absolute discretion. Upon making the determination pursuant to By-Law 34.4, the ESS Committee shall allot the KUB Shares to the Performance Share Plan Participant subject to the maximum number of shares set out in the Performance Share Plan Participants Performance Share Plan Agreement and subject to By-Law 5. As soon as practicable after a relevant determination is made pursuant to By-Laws 34.4 and 34.5, the ESS Committee shall notify each Performance Share Plan Participant the: (a) (b) number of KUB Shares allotted to him; retention period for those KUB Shares (if any);

34.5

34.6

32

APPENDIX I

(c) (d) 34.7

dates on which the KUB Shares allotted shall vest (where applicable); and any other conditions of the allotment.

In the event a Performance Share Plan Participant is subject to disciplinary proceedings (whether or not such disciplinary proceedings will give rise to a dismissal or termination of service), the ESS Committee may in its discretion, suspend the operation of the Performance Share Plan Agreement pending the outcome of such disciplinary proceedings. The ESS Committee may impose such terms and conditions as the ESS Committee shall deem appropriate having regard to the nature of the charges made or brought against the Performance Share Plan Participant and the outcome of such disciplinary proceedings PROVIDED ALWAYS THAT in the event that such Performance Share Plan Participant shall subsequently be found to be not guilty of the charges which gave rise to such disciplinary proceedings, the ESS Committee shall reinstate the Performance Share Plan Agreement of the Performance Share Plan Participant PROVIDED THAT such reinstatement is within the duration of the Scheme in accordance with By-Law 12. No Performance Share Plan Participant shall have a right to require KUB Shares to be allotted to him/her unless and until the ESS Committee has made a determination under ByLaws 34.4 and 34.5 to allot KUB Shares to him under his/her Performance Share Plan Agreement. TERMINATION OF PERFORMANCE SHARE PLAN AGREEMENT(S) Subject to By-Laws 35.2 and 35.3, all Performance Share Plan Agreements and any prospective Unvested Performance Shares shall forthwith lapse and/or be deemed to be cancelled in relation to any KUB Shares upon the occurrence of one or more of the following events: (a) (i) (ii) (b) (c) in the case of a Director, the Performance Share Plan Participant ceasing to be a Director; and/or in the case of an employee, the Performance Share Plan Participant ceasing to be in employment with a corporation within the KUB Group; or

34.8

35. 35.1

in the event of the liquidation of KUB; or in the event of bankruptcy of the Performance Share Plan Participant.

35.2

In the event of the cessation of a Performance Share Plan Participant as a Director and/or employee upon the occurrence of any of the following: (a) (b) (c) (d) (e) (f) retirement on attaining the retirement age under the KUB Groups retirement policy; retirement before attaining the normal retirement age; expiry of service contract; redundancy; ill-health, injury, physical or mental disability; or any other circumstances which are acceptable to the ESS Committee,

the ESS Committee may, upon such terms and conditions as may be set out, (i) if there remains any prospective entitlement to Unvested Performance Shares, allow for such number of KUB Shares to be immediately vested in favour of that

33

APPENDIX I Performance Share Plan Participant; (ii) if in relation to a Performance Share Plan Agreement where a determination pursuant to By-Laws 34.4 and 34.5 has yet to be made, make such determination based on that Performance Share Plan Participants level of achievement and allot such number of KUB Shares as the ESS Committee deems appropriate.

35.3

In the event of death of the Performance Share Plan Participant, the ESS Committee may, upon such terms and conditions as may be set out, (i) if there remains any prospective entitlement to Unvested Performance Shares, allow such number of KUB Shares to be immediately vested on that Performance Share Plan Participant; if in relation to a Performance Share Plan Agreement where a determination pursuant to By-Laws 34.4 and 34.5 has yet to be made, make such determination based on that Performance Share Plan Participants level of achievement and allot such number of KUB Shares as the ESS Committee deems appropriate.

(ii)

36. 36.1

TAKEOVER In the event of: (i) a takeover offer being made for the Company through a general offer to acquire the whole of the issued share capital of the Company (or such part thereof not at the time owned by the person making the general offer (Offeror) or any persons acting in concert with the Offeror); or the Offeror becoming entitled or bound to exercise the right of compulsory acquisition of KUB Shares under the provisions of any applicable statutes, rules and/or regulations and gives notice to the Company that it intends to exercise such right on a specific date;

(ii)

the ESS Committee may, upon such terms and conditions as may be set out, (a) if there remains any prospective entitlement to Unvested Performance Shares, allow for such number of KUB Shares to be immediately vested in favour of the Performance Share Plan Participant; if, in relation to a Performance Share Plan Agreement where a determination pursuant to By-Laws 34.4 and 34.5 has yet to be made, make such determination based on the Performance Share Plan Participants level of achievement and allot such number of KUB Shares as the ESS Committee deems appropriate.

(b)

36.2

In the event of death of the Performance Share Plan Participant during the circumstances set out in By-Law 36.1, By-Law 35.3 shall apply. SCHEME OF ARRANGEMENT, AMALGAMATION, RECONSTRUCTION, ETC. In the event of the court sanctioning a compromise or arrangement between the Company and its members proposed for the purposes of, or in connection with, a scheme of arrangement and reconstruction of the Company, or its amalgamation with any other company or companies the ESS Committee may, upon such terms and conditions as may be set out, (a) if there remains any prospective entitlement to Unvested Performance Shares, allow for such number of KUB Shares to be immediately vested in favour of the Performance Share Plan Participant;

37. 37.1

34

APPENDIX I

(b)

if, in relation to a Performance Share Plan Agreement where a determination pursuant to By-Laws 34.4 and 34.5 has yet to be made, make such determination based on the Performance Share Plan Participants level of achievement and allot such number of KUB Shares as the ESS Committee deems appropriate.

37.2

In the event of death of the Performance Share Plan Participant during the circumstances set out in By-Law 37.1, By-Law 35.3 shall apply.

[The remainder of this page is intentionally left blank.]

35

APPENDIX I FIRST SCHEDULE ADJUSTMENT TO THE SHARE OPTION PRICE / PERFORMANCE SHARE PRICE FOR THE NUMBER OF KUB SHARES The Share Option Price and/or the number of underlying KUB Shares comprised in a Share Option in respect of the right to subscribe for or acquire KUB Shares so far as unexercised and in the case of the Performance Share Plan, the number of KUB Shares to be allotted under the Performance Share Plan Agreement and to which a Share Option Holder and/or Performance Share Plan Participant may be entitled shall from time to time, be adjusted, calculated or determined by the ESS Committee and must be confirmed in writing by an external auditor or Adviser (other than adjustments made pursuant to bonus issues) for the time being of the Company in accordance with the following relevant provisions. (a) If and whenever a KUB Share by reason of any consolidation or subdivision or conversion shall have a different par value, the Adjusted Share Option Price / Adjusted Performance Share Price shall be calculated in accordance with the following formula: Adjusted Share Option Price / Adjusted Performance Share Price = S x Revised par value for each KUB Share Original par value for each KUB Share

and the adjusted number of underlying KUB Shares comprised in the Share Option so far as unexercised (Adjusted Shares Under Share Option) and the adjusted number of underlying KUB Shares comprised in the Performance Share Plan Agreement so far as still subsisting (Adjusted Shares Under Performance Share Plan Agreement) which a Share Option Holder and/or Performance Share Plan Participant may be entitled to be issued shall be calculated in accordance with the following formula: Adjusted Shares Under Share Option / Adjusted Shares Under Performance Share Plan Agreement S= T= Original par value for each KUB Share Revised par value for each KUB Share

T x

existing Share Option Price / existing Performance Share Price; and existing number of KUB Shares entitled under the Share Option or in the case of a Performance Share Plan, the number of KUB Shares allotted under the Performance Share Plan Agreement.

Each such adjustment will be effective from the close of business on the next Market Day following the date of which the consolidation or subdivision or conversion becomes effective (being the date when KUB Shares are traded on Bursa Securities at the new par value), or such period as may be prescribed by Bursa Securities. (b) If and whenever the Company shall make any allotment of KUB Shares to ordinary shareholders credited as fully paid, by way of capitalization of profits or reserves (whether of a capital or income nature and including any share premium account and capital redemption reserve fund) other than pursuant to the Scheme, the Adjusted Share Option Price / Adjusted Performance Share Price shall be calculated in accordance with the following formula: Adjusted Share Option Price / Adjusted Performance Share Price = S x A A+B

36

APPENDIX I and the adjusted number of KUB Shares which a Share Option Holder and/or Performance Share Plan Participant may be entitled to be issued shall be calculated as follows: Adjusted Shares Under Share Option / Adjusted Shares Under Performance Share Plan Agreement where: S= A= B= as S above; the aggregate number of issued and paid-up KUB Shares immediately before such capitalisation issue; the aggregate number of KUB Shares to be issued pursuant to any allotment to ordinary shareholders credited as fully paid by way of capitalisation of profits or reserves (whether of a capital or income nature and including any share premium account and capital redemption reserve fund); and as T above. A+B = T x A

T=

The adjustment pursuant to this clause shall be made on the day immediately following the books closure date for such issue. (c) If and whenever the Company shall make: (i) a Capital Distribution (as defined below) to ordinary shareholders whether on a reduction of capital or otherwise (but excluding any cancellation of capital which is lost or unrepresented by available assets); any offer or invitation to its ordinary shareholders where they may acquire or subscribe for KUB Shares by way of rights; or any offer or invitation to ordinary shareholders by way of rights where they may acquire or subscribe for securities convertible into KUB Shares or securities with rights to acquire or subscribe for KUB Shares,

(ii) (iii)

then and in respect of each such case, the Adjusted Share Option Price / Adjusted Performance Share Price shall be calculated in accordance with the following formula: Adjusted Share Option Price / Adjusted Performance Share Price where: S= T= C= as S above; as T above; the Current Market Price (as defined in paragraph (h) below) of each KUB Share on the Market Day immediately preceding the date on which the Capital Distribution or, as the case may be, the offer or invitation is publicly announced to Bursa Securities or (failing any such announcement) immediately preceding the date of the Capital Distribution or, as the case may be, of the offer or invitation; and (i) in the case of an offer or invitation to acquire or subscribe for KUB Shares under Clause (c)(ii) or securities convertible into or with rights to acquire or subscribe for KUB Shares under Clause (c)(iii), the value of rights attributable to one (1) KUB Share (as defined below); or = S x CD C

D=

37

APPENDIX I (ii) in the case of any other transaction falling within Clause (c), the fair market value as determined (with the concurrence of the KUBs external auditors) by the Adviser of the portion of the Capital Distribution attributable to one (1) KUB Share.

For the purpose of definition (i) of D, the value of the rights attributable to one (1) KUB Share shall be calculated in accordance with the formula: D = where: C= E= as C above; the subscription price for one (1) additional KUB Share under the terms of offer or invitation or one (1) additional security convertible into KUB Shares or one (1) additional security with rights to acquire or subscribe for KUB Shares; and the number of KUB Shares which it is necessary to hold in order to be offered or invited to acquire or subscribe for one (1) additional KUB Share or security convertible into KUB Shares or right to acquire or subscribe for KUB Shares, CE F+1

F=

and in respect of the case referred to in Clause (c)(ii) and (c)(iii), the number of adjusted number of KUB Shares which a Share Option Holder and/or Performance Share Plan Participant may be entitled to be issued, shall be calculated as follows: Adjusted Shares Under Share Option / Adjusted Shares Under Performance Share Plan Agreement where: T = C = D* = as T above; as C above; and the value of the rights attributable to one (1) KUB Share C = T x C D*

For the purpose of D* above, the value of the rights attributable to one (1) KUB Share shall be calculated in accordance with the formula: D* = where: C = E* = F* = as C above; the subscription price for one (1) additional KUB Share under the terms of such offer or invitation to acquire or subscribe for KUB Shares; and the number of KUB Shares which it is necessary to hold in order to be offered or invited to acquire or subscribe for one (1) additional KUB Share. C E* F* + 1

For the purpose of Clause (c), Capital Distribution shall (without prejudice to the generality of that expression) include distributions in cash or specie or by way of issue of KUB Shares (not falling under Clause (b)) or other securities credited as fully or partly paid-up by way of capitalisation of profits or reserve (whether of a capital or income nature and including any

38

APPENDIX I share premium account or capital redemption reserve fund) other than pursuant to the Scheme. Any dividend charged or provided for in the accounts of any period shall (whenever paid and howsoever described) be deemed to be a Capital Distribution unless it is paid out of the aggregate of the net profits attributable to the ordinary shareholders as shown in the audited consolidated profit and loss accounts of the Company. The adjustments pursuant to this clause shall be made on the day immediately following the books closure date for the above transactions. (d) If and whenever the Company makes any allotment to its ordinary shareholders as provided in Clause (b) and also makes any offer or invitation to its ordinary shareholders as provided in Clause (c)(ii) or (iii) and the record date for the purpose of the allotment is also the book closure date for the purpose of the offer or invitation, the Adjusted Share Option Price / Adjusted Performance Share Price shall be calculated in accordance with the following formula: Adjusted Share Option Price / Adjusted Performance Share Price = S x (G x C) + (H x I) (G + H + B) x C

and where the Company makes any allotment to its ordinary shareholders as provided in Clause (b) and also makes any offer or invitation to its ordinary shareholders as provided in Clause (c)(ii) and the record date for the purpose of the allotment is also the record date for the purpose of the offer or invitation, the number of adjusted KUB Shares which a Share Option Holder and/or Performance Share Plan Participant may be entitled to be issued shall be calculated as follows: Adjusted Shares Under Share Option Adjusted Shares Under Performance Share Plan Agreement where: S = G= C= H= as S above; the aggregate number of issued and fully paid-up KUB Shares on the books closure date; as C above; the aggregate number of new KUB Shares under an offer or invitation to acquire or subscribe for KUB Shares by way of rights or under an offer or invitation by way of rights to acquire or subscribe for securities convertible into KUB Shares or right to acquire or subscribe for KUB Shares as the case may be; the aggregate number of new KUB Shares under an offer or invitation to acquire or subscribe for KUB Shares by way of rights; the subscription price of one (1) additional KUB Share under the offer or invitation to acquire or subscribe for KUB Shares or the exercise price on conversion of such securities or exercise of such rights to acquire or subscribe for one (1) additional KUB Share, as the case may be; the subscription price of one (1) additional KUB Share under the offer or invitation to acquire or subscribe for KUB Shares; = = T x T x (G + H* +B) x C (G x C) + (H* x I*) (G + H + B) x C (G x C) + (H x I)

H* = I=

I* =

39

APPENDIX I B= T= as B above; and as T above.

The adjustment pursuant to this clause shall be made on the day immediately following the books closure date for such issue. (e) If and whenever the Company makes any offer or invitation to its ordinary shareholders to acquire or subscribe for KUB Shares as provided in Clause (c)(ii) together with an offer or invitation to acquire or subscribe for securities convertible or rights to acquire or subscribe for ordinary shareholders as provided in Clause (c)(iii), the Adjusted Share Option Price / Adjusted Performance Share Price shall be calculated in accordance with the following formula: Adjusted Share Option Price / Adjusted Performance Share Price = S x (G x C) + (H* x I*) + (J x K) (G + H* + J) x C

and the number of adjusted KUB Shares which a Share Option Holder and/or Performance Share Plan Participant may be entitled to be issued shall be calculated as follows: Adjusted Shares Under Share Option Adjusted Shares Performance Share Agreement where: S= G= C= H= H* = I= I* = J= as S above; as G above; as C above; as H above; as H* above; as I above; as I* above; the aggregate number of KUB Shares to be issued to its ordinary shareholders upon conversion of such securities or exercise of such rights to subscribe for KUB Shares by the ordinary shareholders; the exercise price on conversion of such securities or exercise of such rights to acquire or subscribe for one (1) additional KUB Share; and as T above. Under Plan = T x (G + H*) x C (G x C) + (H* x I*) (G +H*+J) x C = T x (G x C) + (H* x I*) + (J x K)

K= T=

The adjustment pursuant to this clause shall be made on the day immediately following the books closure date for the above transactions. (f) If and whenever the Company makes an allotment to its ordinary shareholders as provided in Clause (b) and also makes an offer or invitation to acquire or subscribe for KUB Shares to its ordinary shareholders as provided in Clause (c)(ii), together with rights to acquire or subscribe

40

APPENDIX I for securities convertible into or with rights to acquire or subscribe for KUB Shares as provided in Clause (c)(iii), and the books closure date for the purpose of allotment is also the record date for the purpose of the offer or invitation, the Adjusted Share Option Price / Adjusted Performance Share Price shall be calculated in accordance with the following formula: Adjusted Share Option Price / Adjusted Performance Share Price (G x C) + (H* x I*) + (J x K) = S x (G + H* + J + B) x C

and the number of adjusted KUB Shares which a Share Option Holder and/or Performance Share Plan Participant shall be entitled to be issued shall be calculated as follows: Adjusted Shares Under Share Option Adjusted Shares Under Performance Share Plan Agreement where: S= G= C= H= H* = I= I* = J= B= K= T= as S above; as G above; as C above; as H above; as H* above; as I above; as I* above; as J above; as B above; as K above; and as T above. = T x (G + H* + B) x C (G x C) + (H* x I*) (G + H* + J + B) x C = T x (G x C) + (H* x I*) + (J x K)

The adjustment pursuant to this clause shall be made on the day immediately following the books closure date for the above transactions. (g) If and whenever (otherwise than pursuant to a rights issue available to all ordinary shareholders and requiring an adjustment under Clause (c)(ii), (c)(iii), (d), (e) or (f) above), the Company shall issue either any KUB Shares or any securities convertible into KUB Shares or any rights to acquire or subscribe for KUB Shares, and in any such case, the Total Effective Consideration per KUB Share (as defined below) is less than ninety percent (90%) of the Average Price for one (1) KUB Share (as defined below) or, as the case may be, the price at which the KUB Shares will be issued upon conversion of such securities or exercise of such rights is determined, the Adjusted Share Option Price / Adjusted Performance Share Price shall be calculated in accordance with the following formula:

41

APPENDIX I Adjusted Share Option Price / Adjusted Performance Share Price where S= L= M= N= as S above; the number of KUB Shares in issue at the close of business on the Market Day immediately preceding the date on which the relevant adjustment becomes effective; the number of KUB Shares which the Total Effective Consideration (as defined below) would have purchased at the average price (exclusive of expenses); and the aggregate number of KUB Shares so issued or, in the case of securities convertible into KUB Shares or rights to acquire or subscribe for KUB Shares, the maximum number (assuming no adjustment of such rights) of KUB Shares issuable upon full conversion of such securities or the exercise in full of such rights. S x L+M L+N

For the purpose of Clause (g), the Total Effective Consideration shall be determined by the Board with the concurrence of the Adviser and shall be: (i) (ii) in the case of the issue of KUB Shares, the aggregate consideration receivable by the Company on payment in full for such KUB Shares; or in the case of the issue by the Company of securities wholly or partly convertible into KUB Shares, the aggregate consideration receivable by the Company on payment in full for such securities or such part of the securities as is convertible together with the total amount receivable by the Company upon full conversion of such securities (if any); or in the case of the issue by the Company of securities with rights to acquire or subscribe for KUB Shares, the aggregate consideration attributable to the issue of such rights together with the total amount receivable by the Company upon full exercise of such rights;

(iii)

in each case without any deduction of any commission, discounts or expenses paid, allowed or incurred in connection with the issue thereof, and the Total Effective Consideration per KUB Share shall be the Total Effective Consideration divided by the number of KUB Shares issued as aforesaid or, in the case of securities convertible into KUB Shares or securities with rights to acquire or subscribe for KUB Shares, by the maximum number of KUB Shares issuable on full conversion of such securities or on exercise in full of such rights. For the purpose of Clause (g), the Average Price of a KUB Share shall be the average price of one (1) KUB Share as derived from the last dealt prices for one (1) or more board lots of KUB Shares as quoted on Bursa Securities on the Market Days comprised in the period used as a basis upon which the issue price of such KUB Shares is determined. Each such adjustment will be calculated (if appropriate retroactively) from the close of business on Bursa Securities on the Market Day next following the date on which the issue is announced, or (failing any such announcement) on the Market Day next following the date on which the Company determines the offering price of such KUB Shares. Each such adjustment will be effective (if appropriate retroactively) from the commencement of the Market Day next following the completion of the above transaction. (h) For the purpose of paragraphs (c), (d), (e) and (f), the Current Market Price in relation to one (1) KUB Share for any relevant day shall be the volume weighted average market price for the five (5) consecutive Market Days before such date or during such other period as may be determined in accordance with any guidelines issued, from time to time, by the Securities Commission.

42

APPENDIX I (i) The foregoing provisions on adjustment of the Share Option Price / Performance Share Price and the number of underlying KUB Shares comprised in a Share Option / Performance Share Plan Agreement shall be subject to the following: (i) on any such adjustment the resultant Share Option Price / Performance Share Price shall be rounded up the nearest one (1) sen and in no event shall any adjustment (otherwise than upon the consolidation of KUB Shares into KUB Shares of larger par value) involve an increase in the Share Option Price / Performance Share Price or reduce the number of underlying KUB Shares comprised in the Share Option so far as unexercised to which the Share Option Holder and/or Performance Share Plan Participant is already entitled to; no adjustment shall be made to the Share Option Price / Performance Share Price in any case in which the amount by which the same would be reduced in accordance with the foregoing provisions would be less than one (1) sen or the number of underlying KUB Shares comprised in the Share Option / Performance Share Plan Agreement so far as unexercised is less than one (1) underlying KUB Share and any adjustment that would otherwise be required then to be made will not be carried forward; if an event giving rise to any such adjustment shall be capable of falling within any two or more of paragraphs (a) to (g) in this First Schedule (both inclusive) or if such event is capable of giving rise to more than one adjustment, the adjustment shall be made in such manner as the ESS Committee and the external auditors or Adviser may agree; if for any reason an event giving rise to an adjustment to the Share Option Price / Performance Share Price and/or the number of underlying KUB Shares comprised in the Share Option / Performance Share Plan Agreement so far as unexercised / subsisting to which a Share Option Holder and/or Performance Share Plan Participant may be entitled to is cancelled, revoked or not completed, the adjustment shall not be required to be made or shall be reversed with effect from such date and in such manner as the ESS Committee and the external auditors or Adviser may agree; in any circumstances where the ESS Committee considers that the adjustments should be made or calculated on a different basis or different date, the Company may appoint an external auditor or Adviser to consider whether for any reasons whatsoever (to the extent permitted by the Listing Requirements, any applicable statutes, rules or regulations) the adjustment calculation, or determination to be made is appropriate or inappropriate as the case may be. If such external auditor or Adviser shall consider the adjustment calculation or determination to be inappropriate, the adjustment shall be modified or nullified in such manner as may be considered by such external auditor or Adviser to be appropriate. if the Board and the external auditor or Adviser are unable to agree upon any adjustment required under these provisions, the Board shall refer the adjustment to the decision of another external auditor or Adviser acting as expert and not arbitrator and whose decision as to such adjustment shall be final and conclusive; and in making any adjustment hereunder, the external auditor or Adviser shall be deemed to be acting as experts and not as arbitrators and, in the absence of manifest error, their decision shall be conclusive and binding on all persons having an interest in the Share Options / Performance Share Plan Agreement.

(ii)

(iii)

(iv)

(v)

(vi)

(vii)

43

APPENDIX II FURTHER INFORMATION 1. RESPONSIBILITY STATEMENT Our Directors have seen and approved this Circular and they, collectively and individually accept full responsibility for the accuracy of the information given in this Circular and confirm that, after making all reasonable enquiries and to the best of their knowledge and belief, there are no false of misleading information or other facts which, if omitted, would make any statement herein false or misleading. 2. CONSENTS CIMB and PricewaterhouseCoopers Capital Sdn Bhd have given and have not subsequently withdrawn their respective written consents to the inclusion in this Circular of their respective names and all references thereto, in the form and context in which they appear in this Circular. 3. DECLARATIONS OF CONFLICT OF INTEREST CIMB is of the opinion that there is no existing conflict of interests, or the likelihood thereof, in its capacity as the Adviser to our Company for the Proposed Scheme. PricewaterhouseCoopers Capital Sdn Bhd is of the opinion that there is no existing conflict of interests, or the likelihood thereof, in its capacity as the Scheme Adviser to our Company for the Proposed Scheme. 4. MATERIAL CONTRACTS Save as disclosed below, our Company and our subsidiaries have not entered into any material contracts (not being contracts entered into in the ordinary course of our business) during the past two (2) years preceding 9 May 2008, being the latest practicable date prior to the printing of this Circular: (i) A Shareholders Agreement dated 7 July 2006 made between the Company and Progas Energy Limited ("PEL") to regulate the relationship of the parties as shareholders of Progas Holdings Limited (PHL) and Progas Pakistan Limited and further for the sale and transfer to PEL of 1,726,918 ordinary shares of USD1 each in PHL, resulting in the Companys shareholding in PHL being reduced to 38.2%. A Shares Sale Agreement dated 13 October 2006 between the Company (as vendor) and Boustead Holdings Berhad (as purchaser) for the sale of 6,300,000 ordinary shares of RM1.00 each in Boustead Naval Shipyard Sdn Bhd (formerly known as PSC-Naval Dockyard Sdn Bhd) (Sale Shares) for a total cash consideration of RM21,546,000, calculated on the basis of RM3.42 per Sale Share. A Supplemental Agreement dated 16 February 2007 was made between the Company and Boustead Holdings Berhad to amend certain terms of the Shares Sale Agreement dated 13 October 2006, including the amount of the consideration, to RM20,462,712. The sale and purchase transaction has been completed A Sale and Purchase Agreement dated 27 February 2007 made between KUB Gas Sdn Bhd, a subsidiary of the Company (as vendor), and Everlast Environmental Management Sdn Bhd (as purchaser) for the sale and purchase of all that piece of industrial land measuring approximately 31,014.61 square meters in area and held under title deed No. HS(D) 67801, PT No. 64539, Mukim Klang, Daerah Klang, Negeri Selangor together with all structures, sub-structures, tanks, pipes, cables, fixtures and fittings moveable and immovable on or below the land, at a purchase price of RM6,176,003, to be settled in the following manner: 44

(ii)

(iii)

(iv)

APPENDIX II

(a) (b)

an initial sum of RM1,235,200.60 to be paid on the execution of the Sale and Purchase Agreement; and the balance purchase price of RM4,940,802.40, to be paid as follows: (aa) (bb) 20% of the purchase price to be paid within 7 days;and 60% of the purchase price to be paid within 3 months,

from the date of the Sale and Purchase Agreement or the Effective Date (as defined in the Sale and Purchase Agreement), whichever is the later. The sale and purchase transaction is pending completion. (v) A Sale of Shares Agreement dated 1 March 2007 made between KUB Ekuiti Sdn Bhd (KUB Ekuiti) (as vendor) and Yayasan Pendidikan Tun Abdul Razak ("Yayasan Pintar") (as purchaser) for the sale and purchase of 45,000,000 ordinary shares of RM1.00 each, representing the entire issued and paid-up share capital, in Universiti Tun Abdul Razak Sdn Bhd (UNITAR), for a total cash consideration of RM45,000,000.00. The sale and purchase has been completed. A Share Sale Purchase Agreement dated 7 March 2007 made between KUB Ekuiti (as vendor) and My-Partners Solutions Sdn Bhd (as purchaser) for the sale and purchase of 55,800,000 ordinary shares of RM1.00 each in KUB Tekstil Sdn Bhd, representing the entire shareholding of KUB Ekuiti in KUB Tekstil Sdn Bhd, for a total cash consideration of RM15,700,000. The sale and purchase transaction has been completed and KUB Tekstil Sdn Bhd ceased to be a subsidiary of KUB Ekuiti. A Sale of Shares Agreement dated 5 June 2007 made between the Company (as vendor) and PEL (as purchaser), a company incorporated in the Republic of Mauritius under its Companies Act 2001, for the sale and purchase of 2,781,310 ordinary shares of USD1.00 each in PHL, a company incorporated in Republic of Mauritius, for a total cash consideration of USD5,562,620, to be paid to the Company not later than 31 December 2007. The 2,781,310 ordinary shares represented the Companys entire equity interest in PHL. The completion date for the sale and purchase transaction has been extended to 30 June 2008. A Shares Sale Agreement dated 14 June 2007 made between KUB Ekuiti (as vendor) and Voyage Frontier (M) Sdn Bhd (as purchaser) for the sale and purchase of 7,200,000 ordinary shares of RM1.00 each, representing 60.0% equity interest, in the share capital of Tele Dynamics Sdn Bhd for a total cash consideration of RM17,050,000. Upon completion of the sale and purchase transaction on 11 January 2008, Tele Dynamics Sdn Bhd ceased to be a subsidiary of KUB Ekuiti. A Sale and Purchase Agreement dated 14 August 2007 made between Peraharta Sdn Bhd (as vendor) and Kumpulan RZA Harta Sdn Bhd (as purchaser) for the sale and purchase of a 6-storey building with lift and basement car park known as No. 134, Jalan Raja Abdullah, Kampung Baru, Kuala Lumpur, held under H.S(D) 77762 No. PT Lot 61, Bandar Kuala Lumpur, Daerah Kuala Lumpur, Negeri Wilayah Persekutuan Kuala Lumpur, for a total purchase consideration of RM4,200,000. Peraharta Sdn Bhd is a wholly-owned subsidiary of the Company. The sale and purchase of the property has been completed.

(vi)

(vii)

(viii)

(ix)

45

APPENDIX II (x) A Sale and Purchase Agreement dated 24 August 2007 made between Utama Steel Works Sdn Bhd (USWSB) (as vendor) and Malaysian Metal Recycling Sdn Bhd (as purchaser) for the sale and purchase on an as-is-where-is basis of: (a) all that piece of leasehold land held under title deed No. HS(D) KA 1337/85 Lot No. 134905, Mukim Hulu Kinta, District of Kinta, State of Perak together with a factory complex erected thereon bearing postal address Kg Bercham Industrial Estate, P.O. Box 68, 30770 Ipoh, Perak; and the plant, machinery, motor vehicles and office equipment, the list of which is annexed to the Sale and Purchase Agreement, at a total purchase price of RM3,650,000, to be settled in the following manner : (aa) (bb) RM365,000 to be paid upon the execution of the Sale and Purchase Agreement; and RM3,285,000 within the Completion Period (as defined in the Sale and Purchase Agreement).

(b)

USWSB is a 51%-owned subsidiary of the Company. The sale and purchase of the land is pending completion. (xi) A Perjanjian Jual Beli dated 6 September 2007 made between Lembayung Sukma Sdn Bhd (as vendor) and Putrajaya Resources Sdn Bhd (as purchaser) for the sale and purchase to Putrajaya Holdings Sdn Bhd of 21 parcels of land held under various grants measuring approximately 352.165 hectares in total, all in the Mukim of Belanja, District of Kinta, State of Perak for a total cash consideration of RM45,487,053.67. Lembayung Sukma Sdn Bhd is a subsidiary of Bina Alam Bersatu Sdn Bhd, which in turn is a subsidiary of the Company. The sale and purchase of the 21 pieces of land is pending completion. A Share Sale Agreement dated 12 September 2007 made between KUB Development Berhad (KUBDB) (as vendor) and Alam Bersih Sdn Bhd (as purchaser) for the sale and purchase of 630,000 ordinary shares of RM1.00 each, representing 70% equity interest, in the share capital of Adil Perdana Sdn Bhd for a total cash consideration of RM630,000.00. KUBDB is a wholly owned subsidiary of the Company. Upon completion of the sale and purchase transaction on 31 March 2008, Adil Perdana Sdn Bhd ceased to be a subsidiary of KUBDB and the Company as the ultimate holding company. A Settlement Agreement dated 25 September 2007 made between the Company and the Government of Malaysia for the termination of the Concession Agreement which was awarded by the Government of Malaysia to the Company to manage the Industrial Training Institute in Prai (ILP-Prai). Pursuant to the Settlement Agreement, the Company has undertaken, inter-alia, to: (a) (b) (c) (d) Settle all debts to any third parties and to deal with the third parties separately without affecting the termination of the Concession Agreement; Cooperate with the Government of Malaysia on the disposal of assets in the premises of ILP-Prai which are not required by the Government of Malaysia; Be responsible for the debtors and creditors of the business during the tenure of the Concession Agreement; and Settle any issues with regard to ILP Prai staff currently employed by the Company before the termination of the Concession Agreement.

(xii)

(xiii)

46

APPENDIX II (xiv) A Share Sale Agreement dated 5 December 2007 made between the Company, ITTAR Sdn Bhd and KUB Hotel and Resort Management Sdn Bhd (both whollyowned subsidiaries of the Company) (as vendors) and Eden Inc. Berhad and Eden Industries Sdn Bhd (as purchaser) for the sale and purchase of the following shares, for a total cash purchase consideration of RM3,500,000: Name of Vendors ITTAR Sdn Bhd KUB Hotel and Resort Management Sdn Bhd Details of shares 500,000 ordinary shares of RM1.00 each, representing the entire issued share capital, in Ittar-IPP (PJ) Sdn Bhd (ITTAR Shares) 1,000,000 ordinary shares of RM1.00 each, representing the entire issued share capital, in KUB Singgahsana Sdn Bhd (Singgahsana Shares), Cash consideration RM500,000.00 RM3,000,000.00

to be settled in the following manner: (a) deposit sums of RM50,000 in respect of the ITTAR Shares and RM300,000 in respect of the Singgahsana Shares, to be paid prior to the execution of the Share Sale Agreement; and the Balance Purchase Consideration (as defined in the Share Sale Agreement) to be paid on the Completion Date (as defined in the Share Sale Agreement).

(b)

The sale and purchase transaction is expected to be completed by 5 June 2008. (xv) A Sale & Purchase Agreement dated 12 December 2007 made between KUB Realty Sdn Bhd (as vendor) and Langkawi Permai Sdn Bhd (as purchaser) for the sale and purchase of that piece of land held under H.S.(M) 591, PT 542 (formerly known as H.S.(M) 77, PT 542), Bandar Padang Mat Sirat, Daerah Langkawi, Negeri Kedah together with buildings, structures and appurtenant erected thereon at a purchase price of RM9,000,000, to be settled in the following manner: (a) (b) RM180,000 to be paid as earnest deposit prior to the execution of the Sale & Purchase Agreement; and RM8,100,000, being the balance purchase price to be paid within 6 months from the date of the execution of the Sale & Purchase Agreement, with an automatic extension of a further 3 months subject to payment of interest at the rate of 8% per annum.

KUB Realty Sdn Bhd is a wholly-owned subsidiary of the Company. The sale and purchase transaction is pending completion. (xvi) A Shares Sale Agreement dated 24 January 2008 made between the Company (as purchaser) and Mohd Fadzli Ghazali (as vendor) for the sale and purchase of 1,800,000 ordinary shares of RM1.00 each, representing 60% equity interest, in Empirical Systems (M) Sdn Bhd, for a total cash consideration of RM4,860,000.00. Pursuant to the terms of the Shares Sale Agreement, simultaneously with the completion of the sale and purchase transaction, the vendor would complete the acquisition of the remaining 600,000 ordinary shares of RM1.00 each in Empirical Systems (M) Sdn Bhd and enter into a shareholders agreement with the Company. The Company intends to subscribe for a further 1,000,000 new ordinary shares of RM1.00 each in Empirical Systems (M) Sdn Bhd. Upon completion of the sale and purchase transaction on 31 March 2008, Empirical Systems (M) Sdn Bhd became a subsidiary of the Company.

47

APPENDIX II (xvii) A Shares Sale Agreement dated 5 February 2008 (as amended by a letter dated 21 April 2008 on the mutual variation of the Shares Sale Agreement) made between the Company (as purchaser) and Nuriza Binti Ahmad Zaharan and Syadida Binti Ahmad Zaharan (as vendors) for the sale and purchase of the following ordinary shares of RM1.00 each, representing 60% of the entire equity interest, in the capital of Ibuzawa Corporation Sdn Bhd: Vendor Nuriza Binti Ahmad Zaharan Syadida Binti Ahmad Zaharan Total No. of shares 900,000 180,000 1,080,000

at a total purchase consideration of RM22,000,000. Upon the completion of the sale and purchase transaction on 21 April 2008, Ibuzawa Corporation Sdn Bhd became a subsidiary of the Company. (xviii) A Sale and Purchase Agreement dated 28 March 2008 made between KUB Realty (PJ) Sdn Bhd, a wholly-owned subsidiary of the Company, (as vendor) and Park Residence Development Sdn Bhd (as purchaser) (as amended by a letter of variation dated 28 March 2008 from KUB Realty (PJ) Sdn Bhd and accepted by Park Residence Development Sdn Bhd on the same day) for the sale and purchase on an as-is-where-is basis, free from all encumbrances, of the following properties: (a) those parcels of shoplots/office space and accessory parcels located on Level Ground, Level 1, and Levels 6 to 23 of the office tower known as Block D of Megan Phileo Avenue with 198,000 sq ft in net lettable area held under Strata Title No. Geran 37731/M1-C&D/1,N1 to 25/316, Parcel No. 316 Floor Nos. 1, N1 to 25, Building No. M1-C&D together with accessory parcels Nos. TK1-A5, TK6-A7, A8, TK8-A9, TK13-A10, ALL, TK20-A12, A13, TK22-A14 and TK24-A15; and 6 levels of podium car parking bays and ramps located on Levels Ground to 5 of the office block tower and on part of Levels Ground to 5 of the office block known as Block C, Megan Phileo Avenue measuring approximately 12,902 square meters in net lettable area, held under Strata Title No. Geran 37731/M1-C&D/1,N1,2,3,4,5/315, Parcel No. 315, Floor Nos. 1, N1, 2, 3, 4, 5, Building No. M1-C&D,

(b)

both erected on Lot No. 144, Seksyen 44, Bandar Kuala Lumpur, Daerah and Negeri Wilayah Persekutuan and bearing postal address of KUB.com, Block D, Megan Avenue II, No. 12 Jalan Yap Kwan Seng, 50450 Kuala Lumpur, together with fixtures, fittings and equipment listed in the Sale and Purchase Agreement, subject to fulfillment of the conditions precedent as set out in the Sale and Purchase Agreement, at a purchase price of RM86,500,000, to be settled as follows: (a) (b) (c) RM2,000,000 as earnest deposit, to be paid prior to the execution of the Sale and Purchase Agreement; RM6,650,000 being balance deposit, to be paid on execution of the Sale and Purchase Agreement; and RM77,850,000 being the balance purchase price to be paid on or before the expiry of the Completion Period (as defined in the Sale and Purchase Agreement).

The sale and purchase transaction is pending completion.

48

APPENDIX II (xix) A Shareholders Agreement dated 31 March 2008 made between the Company and Mohd Fadzli Ghazali to regulate the relationship of the parties as shareholders of Empirical Systems (M) Sdn Bhd and to provide for the increase in the issued and paid up share capital of Empirical Systems (M) Sdn Bhd from RM3,000,000 to RM4,000,000 and the allotment and issue of 1,000,000 ordinary shares of RM1.00 each to the Company to be settled by way of cash or asset injection amounting to RM1,000,000. A Shareholders Agreement dated 21 April 2008 made between Nuriza Binti Ahmad Zaharan and Syadida Binti Ahmad Zaharan and the Company to regulate the relationship between the parties as shareholders of Ibuzawa Corporation Sdn Bhd.

(xx)

5.

MATERIAL LITIGATION Save as disclosed below, as at 9 May 2008, being the latest practicable date prior to the printing of this Circular, neither we nor our subsidiaries, are engaged in any material litigation, either as plaintiff or defendant, which has a material effect on the financial position or business of our Group, and our Directors are not aware of any proceedings pending or threatened, or of any other facts likely to give rise to any proceedings which may materially and adversely affect the financial position or business of our Group. (i) On 2 July 1997, Sistemaju IT Sdn Bhd (SISB) filed a writ of summons and statement of claim against KUB IT Sdn Bhd (KUBIT), a subsidiary of the Company, in the High Court at Kuala Lumpur under Suit No. S6-22-276-1997 to recover approximately RM1.8 million and interest for outstanding payments for the supply of computer softwares, equipments and consultancy services to Syarikat Air Johor Sdn Bhd. KUBIT filed a counter-claim for RM386,263.33 being liquidated ascertained damages, RM18,080.00 for equipment supplied, other damages and costs. SISB obtained summary judgment against KUBIT on 12 August 1998. On 14 August 1998, KUBIT filed a notice of appeal to the Judge-In-Chambers. The appeal was allowed with costs on 24 February 1999. On 19 March 1999, SISB filed a notice of appeal with the Court of Appeal. The appeal was discontinued on 19 September 2002. At the case management held on 26 May 2005, the parties were directed by the Court to, among others, settle the matter amicably. The parties have failed to reach settlement and the matter is now fixed for case management on 10 June 2008 and for trial on 7 July 2008 and 8 July 2008. The Board is of the view that KUBIT has an arguable case. On 29 November 2002, the Company filed a joint summons with Peraharta Sdn Bhd (collectively, the plaintiffs) against Radzi Sdn Bhd (RSB) in the High Court at Kuala Lumpur under Suit No. S2-22-1412-2002. The claim arose out of a Sale Agreement dated 26 August 1996 made between Permodalan Perak Berhad and RSB for the sale and purchase of a building known as Wisma Espipi, Kampung Bahru, Kuala Lumpur. The claim was for, among others, RM192,000.00, being 5% liquidated and ascertained damages, RM2.13 million, being outstanding rental guaranteed under the Sale Agreement, interest on the amounts claimed at such rate and an account for all rentals and other payments collected by RSB from the tenants of Wisma Espipi with effect from 1 September 2002. On 30 December 2002, the Court ordered that RSB be restrained from exercising its rights under the Sale Agreement and from collecting rentals from the tenants on the property in dispute. On 25 April 2003, the Court further ordered that RSB pay into Court a sum of RM1,696,907.30 being the difference between the rentals collected and the expenditures incurred by RSB since 1997 until the filing of the suit, which sum shall be retained by the Court until disposal of the suit. The suit is now pending hearing of RSBs appeal to the Court of Appeal against the decisions by of the court on 1 March 2005 rejecting RSBs application (a) to set aside the order dated 30 December 2002; and (b) to obtain a stay of further proceedings and execution pending appeal from the order of 25 April 2003. The solicitors for the Company are of the view that the plaintiffs have a sustainable cause of action against RSB on its merits and are in a good position to recover the amount claimed against RSB. 49

(ii)

APPENDIX II (iii) On 29 October 2003, Atlanta Resources Sdn Bhd (ARSB) filed a summons and statement of claim against KUB Realty Sdn Bhd, a subsidiary of the Company, in the High Court at Kuala Lumpur under Suit No. S4-22-1709-03 to recover RM825,493.63 and interest for services rendered by ARSB as co-managers with KUB Realty Sdn Bhd for interior designing works carried out at a building known as KUB.com. The case is fixed for trial on 4 September 2008 and 5 September 2008. The Board is of the opinion that KUB Realty Sdn Bhd has a reasonable chance of defending the suit. On 17 March 2004, KUBDB, a subsidiary of the Company, filed a summons and a statement of claim in the High Court at Seremban under Suit No. 22-47-2004 against Shai Abadi Enterprise Sdn Bhd (First Defendant), one Shahrulakram Bin Osman, one Rosmini Binti Omar and one Shaidatul Zahirim Binti Osman (Second, Third and Fourth Defendants) (collectively known as the Defendants). The claims were made for the following sums: (a) against the First Defendant: (aa) (bb) (cc) (dd) b. RM2.3 million, being money advanced to the First Defendant; interest at the rate of 8% pr annum from the date of termination of contract (being 21 August 2003) until the date of settlement; interests at the rate of 8% per annum from the date of judgment until the date of settlement; and costs,

(iv)

against the Second, Third and Fourth Defendants: (aa) RM2 million being the amount guaranteed by the Second, Third and Fourth Defendants pursuant to the Letter of Guarantee dated 5 December 1996; interest at the rate of 8% per annum from the date of judgment until the date of settlement; and costs.

(bb) (cc)

The claim arose from a breach of a project management agreement dated 5 December 1996 and a letter of variation dated 6 November 1997. KUBDBs application for summary judgment against the First Defendant for the advances of RM 2.3 million paid to the First Defendant was allowed by the court on 6 July 2007. The Defendants have filed a notice of appeal to the Judge in Chambers on 11 July 2007 and the case is fixed for hearing on 9 June 2008. The Board is of the opinion that there is a reasonable chance that the appeal by the Defendants will not be allowed (v) On 27 March 2004, USWSB, a subsidiary of the Company, filed a summons and statement of claim against HBO Enterprise Sdn Bhd (HBO) in the High Court at Ipoh under Suit No. 22-55-2004 to recover RM1,924,524.63 for the supply, installation, testing and commissioning of steel pipes in Kinta District, Ipoh under a sub-contract between USWSB and Lembaga Air Perak. USWSB obtained summary judgment against HBO on 28 July 2004. An appeal by HBO against the judgment was dismissed with costs on 24 April 2006. HBO then filed an appeal to the Court of Appeal. The parties attempted to settle the matter amicably but failed. The case is fixed for hearing on 2 July 2008. The solicitors for USWSB are of the view that USWSB has a high prospect of recovering the full RM1,924,124.63 after the assessment of damages. On 21 May 2004, Bina Alam Bersatu Sdn Bhd (Bina Alam), a subsidiary of the Company, filed a suit against TPPT Sdn Bhd (TPPT) in the High Court at Kuala Lumpur under Suit No. S6-22-751-2004. The suit was filed on a quantum meruit basis, wherein Bina Alam claimed the sum of RM4,669,360.33 together with interest 50

(vi)

APPENDIX II at the rate of 8% per annum on the amount claimed calculated from 21 May 2004 until the date of full settlement, being the amount of work done by Bina Alam and its appointed consultants in respect of a project known as Tabung Pusingan Perumahan Kos Rendah (TPPKR) Rancangan Tanah Berkelompok Kg. Sungai Serai, Mukim Rawang, Selangor. Case management is fixed for 16 June 2008. The solicitors acting for Bina Alam are of the view that Bina Alam has a good chance of succeeding in the case. (vii) On 15 June 2004, A & W Malaysia Berhad (A&W), a subsidiary of the Company filed a suit against Matrix Consolidated Sdn Bhd (MCSB) in the High Court at Kuala Lumpur under Suit No. S5-22-907-04. The suit arose out of two (2) Sub-License Agreements dated 7 September 1992 and 1 December 1992 respectively (Agreements) whereby by virtue of the Agreements, MCSB was appointed as the sub-licensee to open and operate three (3) A&W outlets at Cheras Leisure Mall, Spectrum Ampang and Kuantan Ocean. A&W claimed for RM527,438.65, being outstanding fees and payments due and owing by MCSB as at 31 August 2003, interest at the rate of 8% per annum from the date of filing of the summons until the date of full settlement and costs. A&W obtained judgment in default of appearance on 19 August 2004 and a garnishee order to show cause on 5 November 2004, which judgment was set aside on 27 May 2005. MCSB served its statement of defence and counter-claim on A&W on 27 July 2005. A&Ws application to withdraw its writ of summons and statement of claim, with liberty to file afresh, was dismissed on 21 April 2006. A&W is attempting to settle the matter. The Board is of the opinion that there is a reasonable chance that the matter will be resolved amicably. On 8 October 2004, the Company filed a suit and statement of claim against Oh Teik Soon, Yeo Siew Thye, Zatisah Holdings Sdn Bhd, Oceanic Gas, LLC and Oceanic Petroleum (Asia) Corporation (collectively, the Defendants) in the High Court at Johor Bahru for breach of warranties and undertakings of the Defendants under a Sale Agreement dated 8 March 2002 by which the Company purchased from the Defendants all the shares in Summit Petroleum (Malaysia) Sdn Bhd for a consideration of RM65,000,000. The Company alleged that as a result of the breach of warranties and undertakings, the Company had suffered losses. The claim against the Defendants is for the following sums: (a) (b) (c) RM3,731,374 being underprovision of deferred tax liability; RM1,360,936 being overvaluation of Pulau Indah land; and RM4,088,296 being overstatement of tax recoverable.

(viii)

An application by the Defendants (other than Oceanic Petroleum (Asia) Corporation, which has been liquidated) to transfer the proceedings to the High Court at Kuala Lumpur was allowed and registered on 27 December 2006 at the Kuala Lumpur High Court under Suit No. S1-22-1174-2006. The matter has been fixed for case management on 7 August 2008. The solicitors for the Company are of the view that the claim by the Company is maintainable. (ix) On 19 November 2004, AK2 Runding Sdn Bhd (AK2) filed a writ of summons and statement of claim against the Company and Pembinaan Efektif Sdn Bhd, a 60% subsidiary of KUB Ekuiti, a direct subsidiary of the Company, in the High Court at Kuala Lumpur under Suit No. S1-22-1694-04 for RM611,403.71, being architect fees due and owing to AK2, interest at the rate of 8% per annum from 5 September 2000 until the date of full payment of the amount claimed and costs. AK2 applied to amend its writ of summons and statement of claim on 23 March 2005. Order in terms was obtained by AK2 on 18 May 2005. The Companys application to strike out the writ of summons and statement of claim was dismissed with cost in the cause on 24 November 2005. The matter is currently pending AK2s case management which has been fixed on 29 July 2008. The Board is of the opinion that the case is maintainable.

51

APPENDIX II (x) On 12 May 1998, Telefocus Sdn Bhd (Telefocus) has filed a writ of summons and statement of claim against Gerik Timber Industries Sdn Bhd (GETI), a subsidiary of the Company, in the High Court at Kuala Lumpur under Suit No. D2-22-1413-98. The claim is for RM1,729,626.20. The claim is for breach of an Agreement dated 7 November 1995 to extract timber from Kawasan Simpanan Ampangan Hidro Kenering & Bersia, Perak. Judgement-in-default of appearance was entered against GETI on 13 May 1999. The said judgment in default of appearance was set aside by the Court on 3 December 2002 and GETI was ordered to file its defence within 14 days from the date of the Order. GETI has instructed its solicitors to file an application to strike out the writ of summons and statement of claim. The Board is of the opinion that there is a reasonable chance of success in striking out the writ. On 7 December 2005, one Tang Wai filed a writ of summons and statement of claim against Maga Textile (M) Sdn Bhd (First Defendant), a subsidiary of the Company, Frank Lee Fu Leong (Second Defendant) and Lee Yin Mei @ Gina Lee (Third Defendant) in the High Court at Kuala Lumpur under Suit No. S7-22-1416-2005. The claim against the First Defendant is for RM5,367,592.83, plus interest being special damages for losses incurred arising from alleged misrepresentation by the First Defendant and Second Defendant. The statement of defence and counterclaim was filed on 21 March 2006. The First Defendant has filed its application for Security for Cost and order in terms was obtained on 30 October 2007. The Plaintiff filed his Notice of Appeal to the Judge in chambers on 7 November 2007 and the matter has been fixed for hearing on 30 May 2008. The Board is of the opinion that the First Defendant has a reasonable chance of defending the suit. On 29 August 2007 the Company received a writ of summons from SKKPJ Development Sdn Bhd (SKKPJ) filed in the High Court at Kuala Lumpur under Suit No. 53-22-802-2007. SKKPJs claim is inter-alia for specific performance under a sale and purchase agreement for the sale and purchase of land in Kluang, Johor and in Oya Dalat, Sarawak belonging to KUB Agrotech Sdn Bhd and KUB Sepadu Sdn Bhd, both subsidiaries of the Company. The matter is now fixed for hearing on 25 June 2008 of the Companys application to strike out the writ. The Board is of the opinion that the Company has a good chance of winning the case.

(xi)

(xii)

6.

DOCUMENTS AVAILABLE FOR INSPECTION The following documents are available for inspection during normal business hours at our registered office between Mondays to Fridays (except public holidays) from the date of this Circular up to and including the date of the EGM: (i) (ii) Our Memorandum and Articles of Association; Our audited consolidated financial statements for the past two (2) financial years ended 31 December 2006 and 31 December 2007 and latest unaudited consolidated quarterly results for the three (3)-month financial period ended 31 March 2008; Consent letters referred to in Section 2 above; Material contracts referred to in Section 4 above; The relevant cause papers in respect of the material litigation referred to in Section 5 above; and The draft By-Laws of the Proposed Scheme.

(iii) (iv) (v) (vi)

52

KUB MALAYSIA BERHAD

(Company No. 6022-D) (Incorporated in Malaysia)

NOTICE OF EXTRAORDINARY GENERAL MEETING NOTICE IS HEREBY GIVEN that an Extraordinary General Meeting of KUB Malaysia Berhad (KUB or Company) will be held at Laman Puteri, Hotel Singgahsana Petaling Jaya, Persiaran Barat off Jalan Sultan, 46760 Petaling Jaya, Selangor at 1:00 p.m. or immediately after the conclusion or any adjournment of the Companys Extraordinary General Meeting (in relation to, amongst others, the Proposed Revised Par Value Reduction as referred to below, this Extraordinary General Meeting being scheduled to be held at 12.30 p.m. or immediately after the conclusion or any adjournment of the Companys 43rd Annual General Meeting to be held on the same day and at the same venue) whichever is the later, for the purpose of considering and, if though fit, passing the following resolutions: SPECIAL RESOLUTION PROPOSED AMENDMENT TO ARTICLE 158 OF THE ARTICLES OF ASSOCIATION OF THE COMPANY THAT approval be and is hereby given for Article 158 of the Companys Articles of Association to be amended by the insertion of the new paragraph (as highlighted in bold below) at the end of the existing Article 158 (Proposed Article 158 Amendment): 158. The Company in general meeting may upon the recommendation of the Directors resolve that it is desirable to capitalize any part of the amount for the time being standing to the credit of any of the Companys reserve accounts or to the credit of the profit and loss account or otherwise available for distribution, and accordingly that such sum be set free for distribution amongst the members who would have been entitled thereto if distributed by way of dividend and in the same proportions on condition that the same be not paid in cash but be applied either in or towards paying up any amounts for the time being unpaid on any shares held by such members respectively or paying up in full unissued shares or debentures of the Company to be allotted and distributed credited as fully paid up to and amongst such members in the proportion aforesaid, or partly in the one way and partly in the other, and the Directors shall give effect to such resolution. A share premium account and a capital redemption reserve may, for the purposes of this Article, be applied only in the paying up of unissued shares to be issued to members of the Company as fully paid bonus shares. Notwithstanding the above, any reserve account created pursuant to approved accounting standards may be capitalised or otherwise applied by the Directors in such manner and for such purposes as may be prescribed, contemplated or permitted by the relevant approved accounting standard(s). ORDINARY RESOLUTION 1 PROPOSED EMPLOYEES SHARE SCHEME THAT subject to: (a) the approvals from the relevant authorities, including approval-in-principle from Bursa Malaysia Securities Berhad (Bursa Securities) for the listing of and quotation for the new ordinary shares in the capital of the Company (KUB Shares) to be issued pursuant to the exercise of the share options and/or pursuant to the performance share plan agreements under the KUB Employees Share Scheme (Scheme), being obtained; i

(b) (c)

the Proposed Par Value Reduction (as defined, and referred to, in the Companys circular to shareholders dated 4 June 2008 in relation to that proposal) taking effect; and the passing of the above Special Resolution in relation to the Proposed Article 158 Amendment,

the Company be and is hereby authorised to: (i) establish, implement and administer the Scheme for the benefit of the directors and employees of the Company and its non-dormant subsidiaries (KUB Group) who are eligible (Eligible Participants) to subscribe for new KUB Shares, in accordance with the By-Laws of the Scheme (By-Laws) as set out in Appendix I of the circular to shareholders dated 4 June 2008 in relation to the Scheme (Circular), the principal terms of the Scheme being as set out in the Circular; allot and issue at any time and from time to time throughout the duration of the Scheme such number of new KUB Shares, being ordinary shares not exceeding in aggregate fifteen per cent (15%) of the total issued and paid-up share capital of the Company at any one time during the existence of the Scheme, as may be required to be allotted and issued upon the exercise of the share options and/or to be allotted and issued pursuant to the performance share plan agreements and such KUB Shares shall, upon such allotment and issuance, rank pari passu in all respects with all the other issued and fully paid-up KUB Shares (including in relation to voting and other rights, whether upon any liquidation of the Company or otherwise) except that the KUB Shares so allotted will not be entitled to any dividends, rights, allotments or other distributions, the entitlement date (namely the date as at the close of business on which shareholders must be registered in order to be entitled to any dividends, rights, allotments or other distributions) of which is prior to the date of allotment of the new KUB Shares, and such new KUB Shares will be subject to all provisions of the Articles of Association relating to the transfer, transmission and otherwise of the KUB Shares; make the necessary application(s) to Bursa Securities for the listing of and quotation for the new KUB Shares to be allotted and issued pursuant to the Scheme; amend and/or modify all or any of the provisions of the Scheme at any time and from time to time, provided that such amendments and/or modifications are effected in accordance with the provisions of the By-Laws relating to amendment and/or modification; and do all such acts and enter into all transactions, arrangements, agreements, deeds or undertakings and to make rules or regulations, or impose such terms and conditions or delegate part or all of its powers as may be necessary or expedient in order to give full effect to the Scheme;

(ii)

(iii) (iv)

(v)

AND THAT the Directors of the Company be and are hereby authorised to do all such deeds, acts and things and execute, sign and deliver all documents, and to take all such steps for and on behalf of the Company as they may consider necessary or expedient or relevant to give effect to, and implement the Scheme with full powers to assent to any conditions, modifications, variations and/or amendments as may be imposed or permitted by the relevant authorities; AND THAT the proposed By-Laws of the Scheme, as set out in Appendix I of the Circular be and is hereby approved. ORDINARY RESOLUTION 2 PROPOSED ALLOCATION OF SHARE OPTIONS AND/OR PERFORMANCE SHARES TO DATO NORDIN BAHARUDDIN THAT subject to the passing of the above Special Resolution and Ordinary Resolution 1, the Company be and is hereby authorised at any time and from time to time throughout the duration of the Scheme, to allot and issue up to a maximum of 155,810 new KUB Shares per annum to Dato Nordin Baharuddin (being the Chairman, Non-Independent Non-Executive Director of the Company) pursuant ii

to any share option(s) and/or performance share plan agreement(s) under the Scheme, subject always to such terms and conditions of the By-Laws of the Scheme; AND THAT the Directors of the Company be and are hereby authorised to do all such deeds, acts and things and execute, sign and deliver all documents, and to take all such steps for and on behalf of the Company as they may consider necessary or expedient or relevant to give effect to, and implement the above authorisation with full powers to assent to any conditions, modifications, variations and/or amendments as may be imposed or permitted by the relevant authorities. ORDINARY RESOLUTION 3 PROPOSED ALLOCATION OF SHARE OPTIONS AND/OR PERFORMANCE SHARES TO DATUK HAJI FAISYAL BIN DATUK YUSOF HAMDAIN DIEGO THAT subject to the passing of the above Special Resolution and Ordinary Resolution 1, the Company be and is hereby authorised at any time and from time to time throughout the duration of the Scheme, to allot and issue up to a maximum of 103,873 new KUB Shares per annum to Datuk Haji Faisyal Bin Datuk Yusof Hamdain Diego (being the Deputy Chairman, Senior Independent NonExecutive Director of the Company) pursuant to any share option(s) and/or performance share plan agreement(s) under the Scheme, subject always to such terms and conditions of the By-Laws of the Scheme; AND THAT the Directors of the Company be and are hereby authorised to do all such deeds, acts and things and execute, sign and deliver all documents, and to take all such steps for and on behalf of the Company as they may consider necessary or expedient or relevant to give effect to, and implement the above authorisation with full powers to assent to any conditions, modifications, variations and/or amendments as may be imposed or permitted by the relevant authorities. ORDINARY RESOLUTION 4 PROPOSED ALLOCATION OF SHARE OPTIONS AND/OR PERFORMANCE SHARES TO DATO KAMILIA IBRAHIM THAT subject to the passing of the above Special Resolution and Ordinary Resolution 1, the Company be and is hereby authorised at any time and from time to time throughout the duration of the Scheme, to allot and issue up to a maximum of 103,873 new KUB Shares per annum to Dato Kamilia Ibrahim (being the Non-Independent Non-Executive Director of the Company) pursuant to any share option(s) and/or performance share plan agreement(s) under the Scheme, subject always to such terms and conditions of the By-Laws of the Scheme; AND THAT the Directors of the Company be and are hereby authorised to do all such deeds, acts and things and execute, sign and deliver all documents, and to take all such steps for and on behalf of the Company as they may consider necessary or expedient or relevant to give effect to, and implement the above authorisation with full powers to assent to any conditions, modifications, variations and/or amendments as may be imposed or permitted by the relevant authorities. ORDINARY RESOLUTION 5 PROPOSED ALLOCATION OF SHARE OPTIONS AND/OR PERFORMANCE SHARES TO ROSMAN ABDULLAH THAT subject to the passing of the above Special Resolution and Ordinary Resolution 1, the Company be and is hereby authorised at any time and from time to time throughout the duration of the Scheme, to allot and issue up to a maximum of 103,873 new KUB Shares per annum to Rosman Abdullah (being the Non-Independent Non-Executive Director of the Company) pursuant to any share option(s) and/or performance share plan agreement(s) under the Scheme, subject always to such terms and conditions of the By-Laws of the Scheme;

iii

AND THAT the Directors of the Company be and are hereby authorised to do all such deeds, acts and things and execute, sign and deliver all documents, and to take all such steps for and on behalf of the Company as they may consider necessary or expedient or relevant to give effect to, and implement the above authorisation with full powers to assent to any conditions, modifications, variations and/or amendments as may be imposed or permitted by the relevant authorities. ORDINARY RESOLUTION 6 PROPOSED ALLOCATION OF SHARE OPTIONS AND/OR PERFORMANCE SHARES TO RAJA ALI RAJA OTHMAN THAT subject to the passing of the above Special Resolution and Ordinary Resolution 1, the Company be and is hereby authorised at any time and from time to time throughout the duration of the Scheme, to allot and issue up to a maximum of 103,873 new KUB Shares per annum to Raja Ali Raja Othman (being the Independent Non-Executive Director of the Company) pursuant to any share option(s) and/or performance share plan agreement(s) under the Scheme, subject always to such terms and conditions of the By-Laws of the Scheme; AND THAT the Directors of the Company be and are hereby authorised to do all such deeds, acts and things and execute, sign and deliver all documents, and to take all such steps for and on behalf of the Company as they may consider necessary or expedient or relevant to give effect to, and implement the above authorisation with full powers to assent to any conditions, modifications, variations and/or amendments as may be imposed or permitted by the relevant authorities. ORDINARY RESOLUTION 7 PROPOSED ALLOCATION OF SHARE OPTIONS AND/OR PERFORMANCE SHARES TO MOHAMED EZZUDDEEN MOHD EFFENDI THAT subject to the passing of the above Special Resolution and Ordinary Resolution 1, the Company be and is hereby authorised at any time and from time to time throughout the duration of the Scheme, to allot and issue up to a maximum of 103,873 new KUB Shares per annum to Mohamed Ezzuddeen Mohd Effendi (being the Independent Non-Executive Director of the Company) pursuant to any share option(s) and/or performance share plan agreement(s) under the Scheme, subject always to such terms and conditions of the By-Laws of the Scheme; AND THAT the Directors of the Company be and are hereby authorised to do all such deeds, acts and things and execute, sign and deliver all documents, and to take all such steps for and on behalf of the Company as they may consider necessary or expedient or relevant to give effect to, and implement the above authorisation with full powers to assent to any conditions, modifications, variations and/or amendments as may be imposed or permitted by the relevant authorities. ORDINARY RESOLUTION 8 PROPOSED ALLOCATION OF SHARE OPTIONS AND/OR PERFORMANCE SHARES TO OMAR HAJI AHMAD THAT subject to the passing of the above Special Resolution and Ordinary Resolution 1, the Company be and is hereby authorised at any time and from time to time throughout the duration of the Scheme, to allot and issue up to a maximum of 103,873 new KUB Shares per annum to Omar Haji Ahmad (being the Independent Non-Executive Director of the Company) pursuant to any share option(s) and/or performance share plan agreement(s) under the Scheme, subject always to such terms and conditions of the By-Laws of the Scheme; AND THAT the Directors of the Company be and are hereby authorised to do all such deeds, acts and things and execute, sign and deliver all documents, and to take all such steps for and on behalf of the Company as they may consider necessary or expedient or relevant to give effect to, and implement the above authorisation with full powers to assent to any conditions, modifications, variations and/or amendments as may be imposed or permitted by the relevant authorities. iv

ORDINARY RESOLUTION 9 PROPOSED ALLOCATION OF SHARE OPTIONS AND/OR PERFORMANCE SHARES TO MOHD NAZAR SAMAD THAT subject to the passing of the above Special Resolution and Ordinary Resolution 1, the Company be and is hereby authorised at any time and from time to time throughout the duration of the Scheme, to allot and issue up to a maximum of 1,800,000 new KUB Shares per annum to Mohd Nazar Samad (being the Executive Director of the Company) pursuant to any share option(s) and/or performance share plan agreement(s) under the Scheme, subject always to such terms and conditions of the By-Laws of the Scheme; AND THAT the Directors of the Company be and are hereby authorised to do all such deeds, acts and things and execute, sign and deliver all documents, and to take all such steps for and on behalf of the Company as they may consider necessary or expedient or relevant to give effect to, and implement the Scheme above authorisation with full powers to assent to any conditions, modifications, variations and/or amendments as may be imposed or permitted by the relevant authorities. By Order of the Board KUB MALAYSIA BERHAD

EULIS RACHMATIAH ISKANDAR SASTRAWIDJAJA (LS 008774) TUNKU ALIZAN RAJA MUHAMMAD ALIAS (BC/T/342) HARNITA HARMAIN (LS008063) Company Secretaries Petaling Jaya 4 June 2008
Notes: 1. A member of the Company entitled to attend and vote at the abovementioned meeting is entitled to appoint a maximum of two (2) proxies whether a member or not as his/her proxy/proxies to attend and vote in his/her stead. Where a member appoints two proxies, the member shall specify the proportion of the members shareholdings to be represented by each proxy, failing which the appointment shall be invalid. The instrument appointing a proxy shall be in writing under the hand of the appointer or his/her attorney duly authorised or if the appointer is a corporation, either under its common seal or signed under the hand of its attorney or by an officer on behalf of the corporation. The Proxy Forms must be deposited at the office of the Companys Share Registrar, Symphony Share Registrars Sdn Bhd, Level 26, Menara Multi-Purpose, Capital Square, No 8 Jalan Munshi Abdullah, 50100 Kuala Lumpur by hand or faxed to 03-27212530/31 not less than forty-eight (48) hours before the time set for holding the meeting or an adjournment thereof (as the case may be).

2.

3.

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KUB MALAYSIA BERHAD

(Company No. 6022-D) (Incorporated in Malaysia)

FORM OF PROXY

Number of shares Held

CDS Account No. Authorised Nominee

of

I/We____________________________________________________________________________________________________ of_______________________________________________________________________________________________________ being a member of KUB MALAYSIA BERHAD, hereby appoint _____________________________________________________ NRIC No/Passport No: _________________________ of__________________________________________________________ and/or failing him__________________________________________________________________________________________ NRIC No/Passport No:__________________________of__________________________________________________________ or failing him/her, the Chairman of the meeting as my/our proxy to vote for me/us on my/our behalf, at the Extraordinary General Meeting of the Company, to be held at Laman Puteri, Hotel Singgahsana Petaling Jaya, Persiaran Barat off Jalan Sultan 46760 Petaling Jaya, Selangor on Thursday, 26 June 2008 at 1:00 p.m. or immediately after the conclusion or any adjournment of the Companys Extraordinary General Meeting (in relation to, among others, the Proposed Par Value Reduction as referred to in the Notice, this Extraordinary General Meeting being scheduled to be held at 12.30 p.m. or immediately after the conclusion or any adjournment of the Companys 43rd Annual General Meeting to be held on the same day and at the same venue) whichever is the later . Special Resolution Proposed Amendment to Article 158 of the Articles of Association of the Company No. 1. 2. 3. 4. 5. 6. 7. 8. 9. Ordinary Resolutions Proposed Employees Share Scheme Proposed Allocation of Share Options and/or Performance Shares to Dato Nordin Baharuddin Proposed Allocation of Share Options and/or Performance Shares to Datuk Haji Faisyal Bin Datuk Yusof Hamdain Diego Proposed Allocation of Share Options and/or Performance Shares to Dato Kamilia Ibrahim Proposed Allocation of Share Options and/or Performance Shares to Rosman Abdullah Proposed Allocation of Share Options and/or Performance Shares to Raja Ali Raja Othman Proposed Allocation of Share Options and/or Performance Shares to Mohamed Ezzuddeen Mohd Effendi Proposed Allocation of Share Options and/or Performance Shares to Omar Haji Ahmad Proposed Allocation of Share Options and/or Performance Shares to Mohd Nazar Samad For Against

For

Against

Please indicate with an X where appropriate against each resolution on how you wish your proxy to vote. If no specific direction to voting is given, the proxy will vote or abstain at his/her discretion. Where a member appoints 2 proxies (refer to Note 1), please specify the proportions of the members holdings to be represented by each proxy: Name of proxy Number of shares represented Dated this day of 2008

Signature(s)/Common Seal(s) of Shareholders(s)

Notes: 1. A member of the Company entitled to attend and vote at the abovementioned meeting is entitled to appoint a maximum of two (2) proxies whether a member or not as his/her proxy/proxies to attend and vote in his/her stead. Where a member appoints two proxies, the member shall specify the proportion of the members shareholdings to be represented by each proxy, failing which the appointment shall be invalid. The instrument appointing a proxy shall be in writing under the hand of the appointer or his/her attorney duly authorised or if the appointer is a corporation, either under its common seal or signed under the hand of its attorney or by an officer on behalf of the corporation. The Proxy Forms must be deposited at the office of the Companys Share Registrar, Symphony Share Registrars Sdn Bhd, Level 26, Menara Multi-Purpose, Capital Square, No 8 Jalan Munshi Abdullah, 50100 Kuala Lumpur by hand or faxed to 03-27212530/31 not less than forty-eight (48) hours before the time set for holding the meeting or an adjournment thereof (as the case may be).

2. 3.

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KUB MALAYSIA BERHAD (6022-D)

C/O THE REGISTRAR SYMPHONY SHARE REGISTRARS SDN BHD (378993-D) LEVEL 26, MENARA MULTI-PURPOSE CAPITAL SQUARE NO 8, JALAN MUNSHI ABDULLAH 50100 KUALA LUMPUR

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