SANICHI TECHNOLOGY BERHAD ( SANICHI OR THE COMPANY ) PROPOSED SHARE CONSOLIDATION; AND PROPOSED BY-LAWS AMENDMENTS

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1 SANICHI TECHNOLOGY BERHAD ( SANICHI OR THE COMPANY ) (I) (II) PROPOSED SHARE CONSOLIDATION; AND PROPOSED BY-LAWS AMENDMENTS (COLECTIVELY REFERRED TO AS THE PROPOSALS ) 1. INTRODUCTION On behalf of the Board of Directors of Sanichi ( Board ), Mercury Securities Sdn Bhd ( Mercury Securities ) wishes to announce that the Company proposes to undertake the following:- (i) (ii) proposed consolidation of every 3 ordinary shares in Sanichi ( Sanichi Shares or Shares ) into 1 Sanichi Share ( Consolidated Share ) ( Proposed Share Consolidation ); and proposed amendments to the by-laws governing the Company s existing employee share option scheme ( By-Laws ) ( Proposed By-Laws Amendments ). (collectively referred to as the Proposals ). 2. DETAILS OF THE PROPOSALS 2.1 Proposed Share Consolidation The Proposed Share Consolidation involves the consolidation of every 3 Shares into 1 Share. As at 12 July 2017, being the latest practicable date prior to the date of this announcement ( LPD ), the issued share capital of the Company is RM85,947, comprising 858,915,156 Shares. For illustration purposes, the 858,915,156 Shares (assuming none of the outstanding Convertible Securities (1) are exercised and/or converted into new Shares) will be consolidated into 286,305,052 Consolidated Shares pursuant to the Proposed Share Consolidation. Note:- (1) As at the LPD, the Company has 21,185,845 outstanding Sanichi warrants 2013/2018 ( Warrants B ), 121,881,861 outstanding Sanichi warrants 2014/2019 ( Warrants C ), 286,136,730 outstanding Sanichi warrants 2016/2019 ( Warrants D ) and outstanding ICULS with nominal value of RM579,303. The outstanding Warrants B, Warrants C, Warrants D and outstanding 4%, 5-year irredeemable convertible unsecured loan stocks ( ICULS ) with nominal value of RM579,303. The outstanding Warrants B, Warrants C, Warrants D and ICULS are collectively referred to as the Convertible Securities. The actual number of Consolidated Shares will be determined based on the issued share capital of the Company as at 5.00 p.m. on a date to be determined by the Board in their absolute discretion as they deem fit and announced later, in which the shareholders of the Company ( Shareholders ) who are registered in the Company s record of depositors are entitled to the Consolidated Shares under the Proposed Share Consolidation ( Books Closure Date ), after taking into consideration any new Sanichi Shares that may be issued pursuant to the exercise and/or conversion of any outstanding Convertible Securities. The Proposed Share Consolidation will result in an adjustment to the reference share price of Shares listed and quoted on the ACE Market of Bursa Malaysia Securities Berhad ( Bursa Securities ). For illustration purposes, based on the last transacted market price of Shares as at the LPD of RM0.065, the theoretical adjusted reference share price of Sanichi Shares upon completion of the Proposed Share Consolidation is as follows:- 1

2 No. of Shares Market / theoretical adjusted reference price per Share RM (1) Total value RM 000 As at the LPD 858,915, (Last transacted market price as at the LPD) 55,829 After the Proposed Share Consolidation 286,305,052 (2) (Theoretical adjusted reference share price after adjustment) 55,829 Notes:- (1) The total value was arrived at by multiplying the number of Shares in issue as at the LPD with the market / theoretical adjusted reference price per Share. (2) The theoretical adjusted reference share price is arrived at based on the following formula:- Theoretical adjusted reference share price = Market price per Share (RM) x Number of Shares as at the LPD Number of Shares after the Proposed Share Consolidation = x 858,915, ,305,052 = Following the above, the illustration based on shareholdings of 1,000 Shares is as follows:- Assumed no. of Shares Market / theoretical adjusted reference price per Share RM (1) Total value RM As at the LPD 1, (Last transacted market price as at the LPD) 65 After the Proposed Share Consolidation 333 (2) (Theoretical adjusted reference share price after adjustment) 65 Notes:- (1) The total value was arrived at by multiplying the number of Shares held with the market / theoretical adjusted reference price per Share. (2) The theoretical adjusted reference share price is arrived at based on the following formula:- Theoretical adjusted reference share price = Market price per Share (RM) x Number of Shares as at the LPD Number of Consolidated Shares after the Proposed Share Consolidation = x 1, =

3 The Proposed Share Consolidation will also result in an adjustment to the reference price of existing Warrants B, Warrants C and Warrants D. For illustration purposes, based on the last transacted market price of Warrants B, Warrants C and Warrants D up to the LPD of RM0.015, RM0.015 and RM0.03 respectively, the theoretical adjusted reference price of Warrants B, Warrants C and Warrants D upon completion of the Proposed Share Consolidation is set out in the following tables. Warrant B No. of Warrants B Market / theoretical adjusted reference price per Warrant B RM (1) Total value RM 000 As at the LPD 21,185, (Last transacted market price as at the LPD) 318 After the Proposed Share Consolidation 7,061,948 (2) (Theoretical adjusted reference price after adjustment) 318 Notes:- (1) The total value was arrived at by multiplying the number of Warrants B in issue as at the LPD with the market / theoretical adjusted reference price per Warrant B. (2) The theoretical adjusted reference price is arrived at based on the following formula:- Theoretical adjusted reference price = Market price per Warrant B (RM) x Number of Warrants B as at the LPD Number of Consolidated Warrants B after the Proposed Share Consolidation = x 21,185,845 7,061,948 = Warrant C No. of Warrants C Market / theoretical adjusted reference price per Warrant C RM (1) Total value RM 000 As at the LPD 121,881, (Last transacted market price as at the LPD) 1,828 After the Proposed Share Consolidation 40,627,287 (2) (Theoretical adjusted reference price after adjustment) 1,828 Notes:- (1) The total value was arrived at by multiplying the number of Warrants C in issue as at the LPD with the market / theoretical adjusted reference price per Warrant C. (2) The theoretical adjusted reference price is arrived at based on the following formula:- 3

4 Theoretical adjusted reference price = Market price per Warrant C (RM) x Number of Warrants C as at the LPD Number of Consolidated Warrants C after the Proposed Share Consolidation = x 121,881,861 40,627,287 = Warrant D No. of Warrants D Market / theoretical adjusted reference price per Warrant D RM (1) Total value RM 000 As at the LPD 286,136, (Last transacted market price as at the LPD) 8,584 After the Proposed Share Consolidation 95,378,910 (2) 0.09 (Theoretical adjusted reference price after adjustment) 8,584 Notes:- (1) The total value was arrived at by multiplying the number of Warrants D in issue as at the LPD with the market / theoretical adjusted reference price per Warrant D. (2) The theoretical adjusted reference price is arrived at based on the following formula:- Theoretical adjusted reference price = Market price per Warrant D (RM) x Number of Warrants D as at the LPD Number of Consolidated Warrants D after the Proposed Share Consolidation = 0.03 x 286,136,730 95,378,910 = 0.09 Based on the above illustration, the Proposed Share Consolidation will increase the reference price of the Shares, Warrants B, Warrants C and Warrants D but it will not have any impact on the total market value of these securities held by Shareholders, holders of Warrants B, Warrants C and Warrants D respectively. Fractional entitlements for the Shares arising from the Proposed Share Consolidation shall be disregarded and dealt with by the Board in such manner at its absolute discretion as it may deem fit or expedient and in the best interest of the Company. Fractional entitlements for the Warrants B, Warrants C and Warrants D arising from the Adjustments shall be disregarded and dealt with by the Board in such manner at its absolute discretion as it may deem fit or expedient and in the best interest of the Company. 4

5 2.1.1 Ranking (i) Consolidated Shares The Consolidated Shares shall rank pari passu in all respects with one another. (ii) Consolidated Warrants B The Consolidated Warrants B shall rank pari passu in all respects with one another. (iii) Consolidated Warrants C The Consolidated Warrants C shall rank pari passu in all respects with one another. (iv) Consolidated Warrants D The Consolidated Warrants D shall rank pari passu in all respects with one another Suspension of trading There will not be any suspension of trading of Shares, Warrants B, Warrants C and Warrants D pursuant to the Proposed Share Consolidation Listing date and notices of allotment The Consolidated Shares, Consolidated Warrants B, Consolidated Warrants C and Consolidated Warrants D will be listed and quoted on the ACE Market of Bursa Securities on the next Market Day after the Books Closure Date. The notices of allotment will be issued and despatched to the entitled shareholders within 4 Market Days after the listing and quotation of the consolidated securities on the ACE Market of Bursa Securities, or such other period as may be prescribed by Bursa Securities. 2.2 Proposed By-Laws Amendments The Company s employee share option scheme took effect on 7 November 2014 and is valid for a period of 5 years. Pursuant to the new Companies Act, 2016 of Malaysia ( Act ) which was gazetted on 15 September 2016 and came into effect on 31 January 2017, the Proposed By-Laws Amendments are intended to streamline the By-Laws of the Company to be aligned with the Act. Please refer to Appendix I of this announcement for further details of the Proposed By- Laws Amendments. [THE REST OF THIS PAGE IS INTENTIONALLY LEFT BLANK] 5

6 3. RATIONALE FOR THE PROPOSALS 3.1 Proposed Share Consolidation The Board is of the view that the higher trading price of the Consolidated Share following the Proposed Share Consolidation may increase the profile of the Company amongst investors and lead to more attention by research houses and fund managers. This may in turn increase market interest and activity in the Consolidated Shares, and render the Consolidated Shares more attractive to investors. As the Company has a large number of Shares in issue and a relatively low trading price range, the Board noted that a small movement in the Share price may result in high percentage movement in the Share price. The Proposed Share Consolidation would lead to a reduction in the number of Shares available in the market and may reduce the magnitude of fluctuation of the Company s market capitalisation. Following the completion of the Proposed Share Consolidation, the theoretical market price of each Share will increase by 3 times and the total number of Shares in issue will be reduced by the corresponding ratio. Notwithstanding this, Shareholders should note that the Proposed Share Consolidation is not expected to alter the total value of the Consolidated Shares held by them. Further, as the Proposed Share Consolidation would lead to a reduction in the number of Shares available in the market, the Company will also benefit from easier management of smaller number of Shares. 3.2 Proposed By-Laws Amendments The Proposed By-Laws Amendments are intended to streamline the Bylaws of the Company to be aligned with the Act. [THE REST OF THIS PAGE IS INTENTIONALLY LEFT BLANK] 6

7 4. EFFECTS OF THE PROPOSALS Minimum Scenario : Assuming none of the outstanding Convertible Securities are exercised and/or converted into new Shares prior to the Proposed Share Consolidation Maximum Scenario : Assuming all the outstanding Convertible Securities are exercised and/or converted into new Shares prior to the Proposed Share Consolidation The Proposed By-Laws Amendments will not have any effect on the issued share capital of the Company, net assets ( NA ), gearing, substantial shareholders shareholdings of the Company, earnings and earnings per Share ( EPS ) of the Company and its subsidiaries ( Group ). 4.1 Share capital The pro forma effects of the Proposed Share Consolidation on the issued share capital of the Company as at the LPD are as follows:- Minimum Scenario Maximum Scenario No. of Shares Share capital No. of Shares Share capital (RM) (RM) Issued share capital as at the LPD 858,915,156 85,947, ,915,156 85,947, Arising from the exercise of all the outstanding Warrants B Arising from the exercise of all the outstanding Warrants C Arising from the exercise of all the outstanding Warrants D Arising from the conversion of all the outstanding ICULS Reversal of warrants reserve and equity component of ICULS upon full exercise and/or conversion ,185,845 (1) 4,449, ,881,861 (2) 25,595, ,136,730 (3) 28,613, ,758,585 (4) 579, ,731, Enlarged issued share capital 858,915,156 85,947, ,290,878, ,915, Issued share capital after the Proposed Share Consolidation 286,305,052 85,947, ,292, ,915, Notes:- (1) Based on the exercise price of RM0.21 per Warrant B. (2) Based on the exercise price of RM0.21 per Warrant C. (3) Based on the exercise price of RM0.10 per Warrant D. (4) Based on ICULS conversion price of RM0.21 for 1 new Share. [THE REST OF THIS PAGE IS INTENTIONALLY LEFT BLANK] 7

8 4.2 NA and gearing The pro forma effects of the Proposed Share Consolidation on the NA and gearing of the Company and its subsidiaries ( Group ) are as follows:- Minimum Scenario Group level (I) (II) Audited as at After adjusting for After (I) and Proposed 30 June 2016 subsequent events (2) Share Consolidation (RM 000) (RM 000) (RM 000) Share capital 28,614 85,947 85,947 Reserves (1) 110, , ,505 Shareholders equity / NA 139, , ,452 No. of Shares in issue ( 000) 286, , ,305 NA per Share (RM) Total borrowings (RM 000) 1,603 1,559 1,559 Gearing (times) 0.01 (4) - (4) - Notes:- (1) Reserves include share premium, equity component of ICULS, foreign currency translation reserve, warrants reserve and accumulated losses / retained earnings. (2) After adjusting for the following:- (i) the issuance of 572,273,460 Shares, 286,136,730 Warrants D, 6,064,595 additional Warrants B and 34,889,061 additional Warrants C pursuant to the renounceable rights issue of Shares together with free Warrants D which was completed on 29 July 2016 ( Previous Rights Issue with Warrants ); and (ii) the conversion of ICULS with nominal value of RM106,043 into 504,966 Shares at a conversion price of RM0.21 for 1 new Share up to the LPD. (3) After deducting the estimated expenses in relation to the Proposals of RM150,000. (4) Negligible. [THE REST OF THIS PAGE IS INTENTIONALLY LEFT BLANK] 8

9 Maximum Scenario Group level Audited as at 30 June 2016 (I) (II) (III) After (I) and assuming all Convertible Securities are fully exercised and/or converted (3) After adjusting for subsequent events (2) After (II) and Proposed Share Consolidation (RM 000) (RM 000) (RM 000) (RM 000) Share capital 28,614 85, , ,916 Reserves (1) 110, ,655 56,988 56,838 Shareholders equity / NA 139, , , ,754 No. of Shares in issue ( 000) 286, ,915 1,290, ,293 NA per Share (RM) Total borrowings (RM 000) 1,603 1,559 1,474 1,474 Gearing (times) 0.01 (5) - (5) - (5) - Notes:- (1) Reserves include share premium, equity component of ICULS, foreign currency translation reserve, warrants reserve and accumulated losses / retained earnings. (2) After adjusting for the following:- (i) the issuance of 572,273,460 Shares, 286,136,730 Warrants D, 6,064,595 additional Warrants B and 34,889,061 additional Warrants C pursuant to the Previous Rights Issue with Warrants; and (ii) the conversion of ICULS with nominal value of RM106,043 into 504,966 Shares at a conversion price of RM0.21 for 1 new Share up to the LPD. (3) After adjusting for the full exercise/conversion of:- (i) 21,185,845 Warrants B at an exercise price of RM0.21, (ii) 121,881,861 Warrants C at an exercise price of RM0.21; (iii) (iv) 286,136,730 Warrants D at an exercise price of RM0.10; and 2,758,585 outstanding ICULS with nominal value of RM579,303 which are convertible into 2,758,585 new Shares at the conversion price of RM0.21. (4) After deducting the estimated expenses in relation to the Proposals of RM150,000. (5) Negligible. 9

10 4.3 Substantial shareholders shareholdings The Proposed Share Consolidation will not have any effect on the percentage of the substantial shareholders shareholdings in the Company. However, the number of Shares held by the substantial shareholders in the Company will reduce proportionately as a result of the Proposed Share Consolidation. The substantial shareholder of the Company based on the Record of Depositors as at the LPD and the pro forma effects of the Proposed Share Consolidation on the substantial shareholder s shareholdings are as follows:- Minimum Scenario Substantial shareholder Mah Wee Mah Siew Kung As at the LPD After the Proposed Share Consolidation Direct Indirect Direct Indirect No. of Shares (1) % No. of Shares (1) % No. of Shares (2) % No. of Shares (2) % 88,710, ,570, Notes:- (1) Based on 858,915,156 issued Shares as at the LPD. (2) Based on the total number of 286,305,052 Consolidated Shares pursuant to the Proposed Share Consolidation. Maximum Scenario Substantial shareholder Mah Wee Mah Siew Kung As at the LPD (I) Assuming full exercise of Convertible Securities (II) After (I) and after the Proposed Share Consolidation Direct Indirect Direct Indirect Direct Indirect No. of Shares (1) % No. of Shares (1) % No. of Shares (2) % No. of Shares (2) % No. of Shares (4) % No. of Shares (4) % 88,710, (3) 129,888,807 (3) ,296, Notes:- (1) Based on 858,915,156 issued Shares as at the LPD. (2) Based on the enlarged total number of 1,290,878,177 Shares assuming full exercise of the outstanding Convertible Securities. (3) After taking into consideration the full exercise of 23,856 Warrants B, 11,083,530 Warrants C and 30,070,708 Warrants D held by Mah Wee Mah Siew Kung as at the LPD. (4) Based on the total number of 430,292,725 Consolidated Shares pursuant to the Proposed Share Consolidation under the Maximum Scenario. 10

11 4.4 Earnings and EPS The Proposed Share Consolidation is not expected to have any material effect on the consolidated earnings of Sanichi Group except for the corresponding increase in the Group s EPS as a result of the lower number of Shares in issue upon completion of the Proposed Share Consolidation. 4.5 Convertible securities As at the LPD, there are 21,185,845 outstanding Warrants B, 121,881,861 Warrants C, 286,136,730 Warrants D and outstanding ICULS with nominal value of RM579,303. Consequential to the Proposed Share Consolidation, the exercise price and/or number of outstanding Warrants B, Warrants C and Warrants D as well as the conversion price of the ICULS may be adjusted in accordance with the provisions of the deed poll dated 14 January 2013 constituting the Warrants B, deed poll constituting the Warrants C dated 14 August 2014, deed poll constituting the Warrants D dated 30 May 2016 and the trust deed governing the ICULS dated 14 January 2013 respectively, to ensure that the status of the warrant holders is not prejudiced as a result of the Proposed Share Consolidation. Such adjustments will only be finalised on the Books Closure Date and will be effective on the next market day after the Books Closure Date. The rights and obligations of the holders of the existing Convertible Securities will remain unchanged, save for the aforesaid adjustments. The holders of the existing Convertible Securities will be officially notified in due course on the effective adjustments arising from the Proposed Share Consolidation. 5. TENTATIVE TIMELINE Subject to all relevant approvals being obtained, the Proposals are expected to be completed by the fourth quarter of APPROVALS REQUIRED The Proposals are subject to approvals being obtained from the following:- (i) (ii) (iii) Bursa Securities for the Proposed Share Consolidation; and Shareholders at an extraordinary general meeting to be convened for the Proposals; and any other relevant authorities, if required. 7. INTER-CONDITIONALITY The Proposed Share Consolidation and Proposed By-Laws Amendments are not interconditional. Save for the above, the Proposals are not conditional upon any other corporate exercise / scheme undertaken or to be undertaken by the Company. 11

12 8. INTERESTS OF DIRECTORS, MAJOR SHAREHOLDERS AND/OR PERSONS CONNECTED WITH THEM None of the Directors of the Company, major shareholders and/or persons connected with them have any interest, direct and/or indirect, in the Proposals. 9. DIRECTORS STATEMENT The Board, having considered the current and prospective financial position, needs and capacity of the Group, and after careful deliberation and taking into consideration the rationale and all other aspects of the Proposals, is of the opinion that the Proposals are in the best interests of the Company. 10. APPLICATION TO THE AUTHORITIES The application in relation to the Proposals has been submitted to Bursa Securities on even date. 11. ADVISER Mercury Securities has been appointed by the Company to act as the Principal Adviser in relation to the Proposals. This announcement is dated 21 July

13 APPENDIX I The Proposed By-Laws Amendments will involve amendments to the following clauses of the By-Laws:- Clauses Existing By-Laws Amended By-Laws 2. The objectives of the Scheme are: The objectives of the Scheme are: (a) (b) (c) (d) to provide an opportunity for the Eligible Employees to participate directly in the equity interests of the Company; to reward and retain the Eligible Employees whose services are vital to the continued growth and success of the Group; to motivate the Eligible Employees towards better performance through greater loyalty and commitment to the Group; and to allow the eligible Non-Executive Directors of the Group to participate in the Scheme in recognition of their responsibilities and liabilities inherent in their appointments. (a) (b) (c) (d) to provide an opportunity for the Eligible Employees (as defined herein) to participate directly in the equity interests of the Company (as defined herein); to reward and retain the Eligible Employees whose services are vital to the continued growth and success of the Group (as defined herein); to motivate the Eligible Employees towards better performance through greater loyalty and commitment to the Group; and to allow the eligible Non-Executive Directors of the Group to participate in the Scheme (as defined herein) in recognition of their responsibilities and liabilities inherent in their appointments. 3.1 Act - The Companies Act, 1965 as may be amended from time to time and includes any reenactment thereof. 3.1 Available Balance - The unissued share capital of the Company which is available for the offer of further Options subject to the limit set out in By-Law 4.2 and after deducting all Options which have been offered and accepted. Act - The Companies Act, as may be amended from time to time and includes any re-enactment thereof. Available Balance - The unissued share capital shares of the Company which is available for the offer of further Options subject to the limit set out in By-Law 4.2 and after deducting all Options which have been offered and accepted. 3.1 Articles of Association The articles of association of the Company. Constitution Company. The Constitution of the 3.1 Director - All directors of the Group within the same meaning given in Section 4 of the Act 3.1 STB Group or Group - At any point of time in during the Option Period, the Company and/or its subsidiary/subsidiaries (excluding dormant companies) as defined in Section 5 of the Act 3.1 STB Share(s) or Share(s) Ordinary share(s) of RM0.10 each in STB or such other par value determined from time to time. 4.2 The maximum number of new STB Shares to be allotted and issued pursuant to the exercise of the Options that may be granted under the Scheme shall not, in aggregate, exceed thirty percent (30%) of the prevailing issued and paidup share capital (excluding treasury shares) of the Company at any one time throughout the duration of the Scheme as provided in By-Law Director - All directors of the Group within the same meaning given in Section 4 2(1) of the Act STB Group or Group - At any point of time in during the Option Period, the Company and/or its subsidiary/subsidiaries (excluding dormant companies) as defined in Section 5 4 of the Act STB Share(s) or Share(s) Ordinary share(s) of RM0.10 each in STB or such other par value determined from time to time. The maximum number of new STB Shares to be allotted and issued pursuant to the exercise of the Options that may be granted under the Scheme shall not, in aggregate, exceed thirty percent (30%) of the prevailing issued and paidup share capital total number of issued shares (excluding treasury shares) of the Company at any one time throughout the duration of the Scheme as provided in By-Law

14 APPENDIX I Clauses Existing By-Laws Amended By-Laws 4.3 Notwithstanding By-Law 4.2 above or any other provision herein contained, in the event the maximum number of new Shares comprised in the Options granted under the Scheme exceeds the aggregate of thirty percent (30%) of the prevailing issued and paid-up share capital (excluding treasury shares), at any one time of the Company as a result of the Company purchasing its own Shares pursuant to Section 67A of the Act or undertaking any other corporate proposal and thereby diminishing the issued and paid-up share capital of the Company, then the Options granted prior to the adjustment of the issued and paid-up share capital of the Company shall remain valid and exercisable in accordance with these By-Laws. However, in such a situation, the ESOS Committee shall not make any further Offers, unless and until such time when the total number of STB Shares to be issued under the Scheme falls below thirty percent (30%) of the Company s prevailing issued and paid-up share capital (excluding treasury shares), at any one time throughout the duration of the Scheme as provided in By-Law Notwithstanding By-Law 4.2 above or any other provision herein contained, in the event the maximum number of new Shares comprised in the Options granted under the Scheme exceeds the aggregate of thirty percent (30%) of the prevailing issued and paid-up share capital total number of issued shares (excluding treasury shares), at any one time of the Company as a result of the Company purchasing its own Shares pursuant to Section 67A 127 of the Act or undertaking any other corporate proposal and thereby diminishing the issued and paid-up share capital total number of issued shares of the Company, then the Options granted prior to the adjustment of the issued and paid-up share capital total number of issued shares of the Company shall remain valid and exercisable in accordance with these By-Laws. However, in such a situation, the ESOS Committee shall not make any further Offers, unless and until such time when the total number of STB Shares to be issued under the Scheme falls below thirty percent (30%) of the Company s prevailing issued and paid-up share capital total number of issued shares (excluding treasury shares), at any one time throughout the duration of the Scheme as provided in By-Law The Company will keep available sufficient unissued Shares in its authorised share capital to satisfy all outstanding Options throughout the duration of the Scheme. 6.1 (b) the allocation to a Director or employee who, singly or collectively through persons connected with them, holds twenty percent (20%) or more of the issued and paid-up share capital (excluding treasury shares) of STB, does not exceed ten percent (10%) of the total number of new Shares to be issued under the Scheme. [ ] 10.5 Within eight (8) Market Days of the receipt by the Company of such Exercise Notice and payment, or such other period as may be prescribed by Bursa Securities, and subject to the Articles of Association, the Company shall allot the relevant number of Shares to the Grantee. The said new Shares will be credited directly into the Grantee s individual/nominee CDS Account as stipulated by the Grantee in the Exercise Note, and a notice of allotment stating the number of new Shares so credited will be issued to the Grantee. No physical certificates will be issued. An application will be made by the Company for the listing of and quotation for such new Shares to Bursa Securities. Deleted (b) the allocation to a Director or employee who, singly or collectively through persons connected with them, holds twenty percent (20%) or more of the issued and paid-up share capital total number of issued shares (excluding treasury shares) of STB, does not exceed ten percent (10%) of the total number of new Shares to be issued under the Scheme. [ ] Within eight (8) Market Days of the receipt by the Company of such Exercise Notice and payment, or such other period as may be prescribed by Bursa Securities, and subject to the Articles of Association Constitution, the Company shall allot the relevant number of Shares to the Grantee. The said new Shares will be credited directly into the Grantee s individual/nominee CDS Account as stipulated by the Grantee in the Exercise Note, and a notice of allotment stating the number of new Shares so credited will be issued to the Grantee. No physical certificates will be issued. An application will be made by the Company for the listing of and quotation for such new Shares to Bursa Securities. 14

15 APPENDIX I Clauses Existing By-Laws Amended By-Laws 11 The Subscription Price of each new Share comprised in any Option shall be determined by the Board upon recommendation of the ESOS Committee and fixed at the higher of the following: (a) the five (5)-day weighted average market price of the Shares, at the Date of Offer, with a discount of not more than ten percent (10%) or such other percentage of discount in accordance with any prevailing guidelines, rules or regulations issued by Bursa Securities or any other relevant authorities from time to time during the duration of the ESOS; or (b) the par value of the Shares of RM0.10 each. Subject to such adjustments as stipulated under By-Law 15 or as may be amended, varied or supplemented from time to time. The Subscription Price of each new Share comprised in any Option shall be determined by the Board upon recommendation of the ESOS Committee and fixed at the higher of the following: based on the five (5)-day weighted average market price of the Shares, at the Date of Offer, with a discount of not more than ten percent (10%) or such other percentage of discount in accordance with any prevailing guidelines, rules or regulations issued by Bursa Securities or any other relevant authorities from time to time during the duration of the ESOS. or (b) the par value of the Shares of RM0.10 each. Subject subject to such adjustments as stipulated under By-Law 15 or as may be amended, varied or supplemented from time to time. 12 The new STB shares will be subject to all the provisions of the Articles of Association including those relating to the transfer, transmission and otherwise of the STB Shares [ ] as shall be necessary to give a Grantee the same proportion of the issued capital of the Company as that to which he was entitled prior to the event giving rise to such adjustment. [ ] The new STB shares will be subject to all the provisions of the Articles of Association Constitution including those relating to the transfer, transmission and otherwise of the STB Shares. [ ] as shall be necessary to give a Grantee the same proportion of the issued capital total number of issued shares of the Company as that to which he was entitled prior to the event giving rise to such adjustment. [ ] 15.2 (h) a purchase by the Company of its own Shares pursuant to Section 67A of the Act. In such event, the following provisions shall apply: (h) a purchase by the Company of its own Shares pursuant to Section 67A 127 of the Act. In such event, the following provisions shall apply: (i) if the number of Shares in respect of Options granted by the Company as at the date of designation of the Shares so purchased as treasury shares or cancellation of such purchased Shares is greater than thirty percent (30%) of the prevailing issued and paid-up share capital of the Company after such designation or cancellation, the ESOS Committee shall not make any further Offers; and (i) if the number of Shares in respect of Options granted by the Company as at the date of designation of the Shares so purchased as treasury shares or cancellation of such purchased Shares is greater than thirty percent (30%) of the prevailing issued and paid-up share capital total number of issued shares of the Company after such designation or cancellation, the ESOS Committee shall not make any further Offers; and 15

16 APPENDIX I Clauses Existing By-Laws Amended By-Laws (ii) if the number of Shares in respect of Options granted by the Company as at the date of designation of the Shares so purchased as treasury shares or (ii) if the number of Shares in respect of Options granted by the Company as at the date of designation of the Shares so purchased as treasury shares or cancellation of such purchased Shares cancellation of such purchased is less than thirty percent (30%) of the prevailing issued and paid-up share capital of the Company after such designation or cancellation, the ESOS Committee may make further Offers only until the total number of Options granted by the Company but which remains unexercised is equivalent to Shares is less than thirty percent (30%) of the prevailing issued and paid-up share capital total number of issued shares of the Company after such designation or cancellation, the ESOS Committee may make further Offers only until the total number of Options granted by the Company but thirty percent (30%) of the prevailing which remains unexercised is issued and paid-up share capital of the Company after such designation or cancellation. equivalent to thirty percent (30%) of the prevailing issued and paid-up share capital of the Company after such designation or cancellation In the event that the Company enters into any scheme of arrangement or reconstruction pursuant to Part VII of the Act, By-Law 15.1 shall be applicable in respect of such part(s) of the scheme which involve(s) any alteration(s) in the capital structure of the Company provided always that By-Law 15.1 shall not be applicable in respect of such part(s) of the scheme which involve(s) any alteration(s) in the capital structure of the Company to which By-Law 15.2 applies In the event of a dispute in respect of any adjustment, any Grantee may request the Company to seek the opinion of an approved company auditor or a licensed investment bank, acting as an expert and not as an arbitrator, as to its fairness and that this be confirmed in writing. In addition, the Company shall in such situations, at the request of any Grantee, furnish such Grantee with a certificate from an approved company auditor or a licensed investment bank stating the opinion of such auditor/investment bank, acting as an expert and not as an arbitrator. For the purposes of this By-Law, an approved company auditor shall have the meaning given in Section 8 of the Act and a licensed investment bank shall be licensed by Bank Negara Malaysia. Nevertheless, for the avoidance of doubt, by virtue of By-Law 26, the decision of the Board shall be final and binding in all respects In the event of a take-over offer being made for the Shares under the Malaysian Code on Take- Overs and Mergers, 2010 and such offer being declared unconditional within three (3) months of the Offer being declared unconditional, or such other period as the Board/ESOS Committee may determined, the following provisions shall apply: [ ] In the event that the Company enters into any scheme of arrangement or reconstruction pursuant to Part VII Division 7, Subdivision 2 of the Act, By-Law 15.1 shall be applicable in respect of such part(s) of the scheme which involve(s) any alteration(s) in the capital structure of the Company provided always that By-Law 15.1 shall not be applicable in respect of such part(s) of the scheme which involve(s) any alteration(s) in the capital structure of the Company to which By-Law 15.2 applies. In the event of a dispute in respect of any adjustment, any Grantee may request the Company to seek the opinion of an approved company auditor or a licensed investment bank, acting as an expert and not as an arbitrator, as to its fairness and that this be confirmed in writing. In addition, the Company shall in such situations, at the request of any Grantee, furnish such Grantee with a certificate from an approved company auditor or a licensed investment bank stating the opinion of such auditor/investment bank, acting as an expert and not as an arbitrator. For the purposes of this By-Law, an approved company auditor shall have the meaning given in Section of the Act and a licensed investment bank shall be licensed by Bank Negara Malaysia. Nevertheless, for the avoidance of doubt, by virtue of By-Law 26, the decision of the Board shall be final and binding in all respects. In the event of a take-over offer being made for the Shares under the Malaysian Code on Take- Overs and Mergers, and such offer being declared unconditional within three (3) months of the Offer being declared unconditional, or such other period as the Board/ESOS Committee may determined determine, the following provisions shall apply: [...] 16

17 APPENDIX I Clauses Existing By-Laws Amended By-Laws 17.2 For the purposes of By-Law 17.1, a company shall be deemed to be divested from the Group in the event that such company would no longer be a subsidiary of the Company pursuant to Section 5 of the Act. For the purposes of By-Law 17.1, a company shall be deemed to be divested from the Group in the event that such company would no longer be a subsidiary of the Company pursuant to Section 5 4 of the Act Subject to the Articles of Association, all Grantees are entitled to inspect the latest audited financial statements of the Company during the usual business hours on any working day at the Registered Office of the Company. 29 ARTICLES OF ASSOCIATION In the event of a conflict between any of the provisions of these By-Laws and the Articles of Association, the Articles of Association shall prevail. Subject to the Articles of Association Constitution, all Grantees are entitled to inspect the latest audited financial statements of the Company during the usual business hours on any working day at the Registered Office of the Company. ARTICLES OF ASSOCIATION CONSTITUTION In the event of a conflict between any of the provisions of these By-Laws and the Articles of Association Constitution, the Articles of Association Constitution shall prevail. Attachment 1 (a) If and whenever a Share by reason of any consolidation or subdivision or conversion shall have a different par value, the Subscription Price and the additional Shares comprised in the Options so far as unexercised ( Additional Shares Under Option ) shall be adjusted, calculated or determined in the following manner: If and whenever a Share by reason of any consolidation or subdivision or conversion of the Shares shall have a different par value, the Subscription Price and the additional revised number of Shares comprised in the Options so far as unexercised ( Additional Revised Number of Shares Under Option ) shall be adjusted, calculated or determined in the following manner: New Subscription Price : S x Revised par value for each Share Original par value for each Share New Subscription Price : S x U V Additional Shares Under Option : T x Original par value for each Share Revised par value for each Share - T Additional Revised Number of Shares Under Option : T x V U Where: - Where: - S = Existing Subscription Price; and T = Existing number of Shares comprised in the Option in respect of the right to subscribe for new Shares so far as unexercised (The par value shall be adjusted to the revised par value) Each such adjustment will be effective from the close of business of the Market Day next following the date on which the consolidation or subdivision or conversion becomes effective (being the date on which the Shares are traded on Bursa Securities at the new par value) or such other date as may be prescribed by Bursa Securities. S = Existing Subscription Price; T = Existing number of Shares comprised in the Option in respect of the right to subscribe for new Shares so far as unexercised U = Aggregate number of Shares (excluding Shares held as treasury shares, if any) in the share capital of the Company immediately preceding such consolidation, subdivision or conversion; and V = Aggregate number of Shares in the share capital of the Company after such consolidation, subdivision or conversion. 17

18 APPENDIX I Clauses Existing By-Laws Amended By-Laws (The par value shall be adjusted to the revised par value) Each such adjustment will be effective from the close of business of the Market Day next following the date on which the consolidation or subdivision or conversion becomes effective (being the date on which the Shares are traded on Bursa Securities at the new par value after such consolidation or subdivision or conversion) or such other date as may be prescribed by Bursa Securities. Attachment 1(b) If and whenever the Company shall make an issue of new Shares 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), the Subscription Price shall be adjusted by multiplying it by the following fraction: If and whenever the Company shall make an issue of new Shares credited as fully paid, by way of capitalisation of profits or reserves (whether of a capital or income nature and including, if applicable, any share premium account and capital redemption reserve fund), the Subscription Price shall be adjusted by multiplying it by the following fraction: New Subscription Price = S x A A + B New Subscription Price = S x A A + B Whilst the Additional Shares Under Option shall be calculated in the following manner:- Additional Shares Under Option Where:- = T x (A + B) A - T Whilst the additional Shares comprised in the Options so far as unexercised ( Additional Shares Under Option ) shall be calculated in the following manner:- Additional Shares Under Option = T x (A + B) A - T A = B = S = The aggregate number of issued and fully paid-up Shares immediately before such capitalisation issue; The aggregate number of new Shares to be issued pursuant to any allotment 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); Existing Subscription Price; and Where:- A = The aggregate number of issued and fully paid-up Shares immediately before such capitalisation issue; B = The aggregate number of new Shares to be issued pursuant to any allotment credited as fully-paid by way of capitalisation of profits or reserves (whether of a capital or income nature and including, if applicable, any share premium account and capital redemption reserve fund); T = Existing number of Shares comprised in the Option in respect of the right to subscribe for new Shares so far as unexercised Each such adjustment will be effective (if appropriate, retroactively) from the commencement of the day next following the entitlement date for such issue. S = T = Existing Subscription Price; and Existing number of Shares comprised in the Option in respect of the right to subscribe for new Shares so far as unexercised Each such adjustment will be effective (if appropriate, retroactively) from the commencement of the day next following the entitlement date for such issue. 18

19 APPENDIX I Clauses Existing By-Laws Amended By-Laws Attachment [ ] [ ] 1(d) Where: Where: Attachment 1(g) G = The aggregate number of issued and fully paid-up Shares on the entitlement date; [ ] For the purposes of this paragraph (g) the Total Effective Consideration shall be determined by the Directors of the Company with the concurrence of the Company s external auditors or a licensed investment bank and shall be: [ ] (ii) In the case of the issue by the Company of securities wholly or party convertible into new 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 The foregoing provisions on adjustment of the Subscription Price shall be subject to the following: (a) On any such adjustment the resultant Subscription Price shall be rounded up to the nearest one (1) sen and in no event shall any adjustment (otherwise than upon the consolidation of Shares into Shares of larger par value) involve an increase in the Subscription Price or reduce the number of Shares comprised in the Option so far as unexercised to which the Grantee is already entitled to; [ ] G = The aggregate number of issued and fully paid-up Shares on the entitlement date; [ ] For the purposes of this paragraph (g) the Total Effective Consideration shall be determined by the Directors of the Company with the concurrence of the Company s external auditors or a licensed investment bank and shall be: [ ] (ii) In the case of the issue by the Company of securities wholly or party partly convertible into new 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 The foregoing provisions on adjustment of the Subscription Price shall be subject to the following: (a) On any such adjustment the resultant Subscription Price shall be rounded up to the nearest one (1) sen and in no event shall any adjustment (otherwise than upon the consolidation of Shares into Shares of larger par value) involve an increase in the Subscription Price or reduce the number of Shares comprised in the Option so far as unexercised to which the Grantee is already entitled to; [ ] (c) If an event giving rise to any such adjustment shall be capable of falling within any two (2) or more of paragraphs (a) to (g) of By-Law 15.1 (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 Directors of the Company and the external auditors or a licensed investment bank may agree; and (c) If an event giving rise to any such adjustment shall be capable of falling within any two (2) or more of paragraphs (a) to (g) of By-Law 15.1 (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 Directors of the Company and the external auditors or a licensed investment bank may agree; and (d) If for any reason an event giving rise to an adjustment to the Subscription Price and/or the number of Shares comprised in the Option so far as unexercised to which a Grantee 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 Directors of the Company and the external auditors or a licensed investment bank may agree. (d) If for any reason an event giving rise to an adjustment to the Subscription Price and/or the number of Shares comprised in the Option so far as unexercised to which a Grantee 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 Directors of the Company and the external auditors or a licensed investment bank may agree; and 19

20 APPENDIX I Clauses Existing By-Laws Amended By-Laws (e) No adjustment shall be made in any event whereby the Subscription Price would be reduced to below the par value of a Share and in the event that any adjustment shall result in the Subscription Price be reduced below the par value of a Share, then the adjustment shall be made to the par value of a Share only; and (e) No adjustment shall be made in any event whereby the Subscription Price would be reduced to below the par value of a Share and in the event that any adjustment shall result in the Subscription Price be reduced below the par value of a Share, then the adjustment shall be made to the par value of a Share only; and (f) In determining a Grantee s entitlements to subscribe for Shares, any fractional entitlements will be disregarded. (f) (e) In determining a Grantee s entitlements to subscribe for Shares, any fractional entitlements will be disregarded. 20