Details of Announcement

General Announcement

Reference No CI-060508-49AF4

Company Name	:	KIA LIM BERHAD
Stock Name	:	KIALIM
Date Announced	:	08/05/2006


Type	:	Announcement
Subject	:	KIA LIM BERHAD ("KIA LIM") AMENDMENTS TO THE LISTING REQUIREMENTS ("LR") OF BURSA MALAYSIA SECURITIES BERHAD ("BURSA SECURITIES") IN RELATION TO PRACTICE NOTE NO. 17/2005 ("PN17")

Contents :

This announcement is dated 8 May 2006.

The Board of Directors of Kia Lim wishes to announce the following:-

1. INTRODUCTION

Pursuant to the Enhanced Practice Note No. 17 Criteria (“Amended PN17”) which is effective from 5 May 2006, Kia Lim is classified as an Affected Listed Issuer, based on paragraph 2.1(a) and 2.1(e) of PN17 is as follows:-

Shareholders’ equity of Kia Lim on a consolidated basis is 21.22% (less than 25%) of the issued and paid up capital based on its audited financial statements for the year ended 31 December 2005 and its shareholders’ equity as at 31 December 2005 of RM9.46 million is less than the minimum issued and paid up capital as required under paragraph 8.16A(1) of the Listing Requirements of RM60 million; and
The auditors have expressed a modified opinion with emphasis on Kia Lim’s going concern in its latest audited accounts of 31 December 2005 and the shareholders’ equity on a consolidated basis is 21.22% (less than 50%) of the issued and paid up capital.

2. OBLIGATIONS OF THE COMPANY PURSUANT TO ENHANCED PN17 CRITERIA

As an Affected Listed Issuer, Kia Lim is required pursuant to the Enhanced PN17 criteria to comply with the following conditions: -

a) undertake a restructuring plan that is substantive and requires the Securities Commission’s (“SC”) approval under Section 32 of the Securities Commission Act 1993;

b) to make the “First Announcement” under amend Practice Note No 17.2005 (“Amended PN17”) or amended Practice Note No 16/2005 (“Amended PN16”) immediately upon triggering the relevant prescribed criteria under the Amended PN17 or receipt of notice under the Amended PN 16;

c) to make a “Requisite Announcement” on the regularisation plan that complies with the conditions prescribed under the Amended PN17 or Amended PN16, as the case may be;

d) once the implementation of its regularization plan has been completed, an application is to be submitted to Bursa Malaysia Securities Berhad together with all the necessary documentary evidence to confirm that it has regularised its condition;

e) an application for an extension of time may be done not later than 15 days prior to the expiry of the relevant timeframe; and

f) clarifying that the “Cash Company” requirements and paragraph (h) of the Enhanced PN 17 Criteria above do not apply to exchange traded funds.

3. STATUS OF PLAN TO REGULARISE CONDITION

As announced on 3 May 2006, Kia Lim has successfully implemented and completed its Rights Issue with Warrants and Debt Restructuring Scheme (“DRS”). Therefore, an application has been made to Bursa Securities for it not to be classified as a PN 17 Company. The above application has been made on the basis that, after accounting for the Rights Issue with Warrants and the DRS:-

a) the shareholders’ equity of Kia Lim as at 31 December 2005, on a consolidated proforma basis is 49.98%; and

b) the auditors’ modified opinion with emphasis on Kia Lim’s going concern was subject to the successful implementation of the DRS. As the DRS has been successfully implemented on 28 April 2006, the auditors’ modified opinion on Kia Lim’s going concern is no longer applicable.

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