KAZTRANSOIL PREPARED ADDITIONAL CLARIFICATIONS FOR PROSPECTIVE INVESTORS TO ELIMINATE POSSIBLE MISUNDERSTANDING OF SHARES DISTRIBUTION PROCEDURE ON PART OF BROAD PUBLIC

05.12.12, 15:58
/Official website of KazTransOil - www.kaztransoil.kz, December 5, 12/ - JSC "KazTransOil" for purposes of eliminating possible misunderstanding by the broad public of the shares distribution procedure has prepared additional clarifications for prospective investors. Current restrictions: 1. Physical persons wishing to purchase shares of JSC "KazTransOil" may submit orders for purchase without amount restrictions. 2. At distribution of shares amongst various investor groups during their offering the order submission term within the subscription period is not taken account of. 3. Citizens of the Republic of Kazakhstan with account taken of restrictions set by the legislation of the Republic of Kazakhstan for particular citizens (including the Constitution of the Republic of Kazakhstan, Act of the Republic of Kazakhstan "On Civil Service", Act of the Republic of Kazakhstan "On Fighting the Corruption") may purchase shares of JSC "KazTransOil" under the "People's IPO" Program. 4. Only citizens of the Republic of Kazakhstan (Retail investors) and accumulative pension funds (APF) using pension assets may purchase company shares under the "People's IPO" Program. Due to this fact: - Brokers must reject orders submitted in the name of legal entities and physical persons which are not citizens of the Republic of Kazakhstan; - Central Securities Depository (CD) conducts additional check of orders submitted and in case of need rejects orders submitted in the name of legal entities and physical persons which are not citizens of the Republic of Kazakhstan; - CD rejects orders from APFs submitted using APFs' own assets. 5. Brokers may take decisions meaning that an order of a Retail investor cannot be forwarded for registering in the system of JSC "Kazakhstan Stock Exchange" (KASE) for the following reasons: - Incompliance of the order's size with the amount of funds available in the Retail investor's sub-account; - Insufficiency of funds in the Retail investor's sub-account for payment of fees and levies related to the purchase of shares. A broker must inform the Retail investor: - of the status of the Retail investor's order and reasons for rejection of the Retail investor's order; - of the need for replenishment of the brokerage account of the Retail investor or aligning of the Retail investor's order with the amount of funds in the brokerage account. 6. KASE, taking into account the CD's data composes and forwards to JSC "KazTransOil" the Registry of orders received from Retail investors and APF. KASE also forwards to JSC "KazTransOil" the Report on repeating orders from the same Retail investor submitted to one broker at various times or submitted to various brokers. 7. JSC "KazTransOil" conducts an additional check of the Registry of accepted orders received from KASE, for: - Absence of orders from persons not entitled to take part in the Program, - Absence of unregistered repeating orders from the same Retail investor. Procedure of orders' sequence distribution 8. JSC "KazTransOil" calculates the combined demand from the Market-maker, Retail investors and APFs. 9. JSC "KazTransOil" accepts for prior satisfaction orders from Retail investors to the amount under KZT7,000,000 (seven million). Whereas: - JSC "KazTransOil" sums up repeating orders submitted by one Retail investor and later during the distribution of shares registers repeating orders in total as a single order. - JSC "KazTransOil" divides orders from Retail investors submitted to the amount exceeding KZT7,000,000 (seven million) in two parts: - for prior satisfaction - part of an order (or the total of repeating orders) to the amount under KZT7,000,000 (seven million); - for satisfaction on a third-priority basis - part of an order (or the total of repeating orders) to the amount exceeding KZT7,000,000 (seven million). - JSC "KazTransOil" accepts all orders from APFs for satisfaction on a second-priority basis. Procedure of orders satisfaction 10. JSC "KazTransOil" satisfies a Market-maker's order in the range of not less than KZT67,000,000 (sixty seven million) but not above KZT157,000,000 (hundred fifty seven million). 11. JSC "KazTransOil" accepts for prior satisfaction orders from Retail investors to the amount under KZT7,000,000 (seven million). - In case the combined amount of orders from Retail investors being satisfied as top-priority (orders and parts of orders to the amount under KZT7,000,000 (seven million)) DOES NOT exceed the volume of shares being offered (minus the Market-maker's order), such orders from retail investors are satisfied in full; - In case the combined amount of orders from Retail investors whose orders are satisfied as top-priority exceeds the volume of shares being offered (minus the Market-maker's order), the maximum amount of order satisfaction will be reduced as follows: - the reduction begins from the maximum amount of order satisfaction being equal to KZT7,000,000 (seven million); - the reduction pace makes up an amount equal to the shares' price; - the reduction is carried out until the combined demand's amount and the volume of shares offered equalize. 12. The volume of shares not demanded by Retail investors who submitted orders to the amount under KZT7,000,000 (seven million) is offered amongst APFs according to orders they submitted. In case the combined amount of orders from APFs exceeds the volume of shares being offered (minus orders satisfied as top-priority), APFs' orders will be satisfied pro rata to their orders. 13. The volume of shares remaining after the distribution on orders being satisfied as top-priority and second-priority is distributed amongst Retail investors, for that part of orders which exceeds KZT7,000,000 (seven million), as follows: - In case the combined demand is less or equal to the remaining volume of shares, all third-priority orders are satisfied in full; - In case the combined demand is higher than the remaining volume of shares, orders are satisfied pro rata. 14. The volume of Company shares not demanded by all groups of investors who submitted orders is offered on the organized security market not earlier than 6 (six) months after the date of offering under the "People's IPO" Program according to the procedure set by the legislation. Settlements 15. After JSC "KazTransOil" has distributed shares amongst all groups of investors who submitted orders, the Registry of orders satisfied will be sent to KASE. Settlements will be conducted in period from December 20, 2012 to December 24, 2012. 16. If the amount of funds in the retail Investor's brokerage sub-account is not sufficient during the settlements, the Broker shall send to the Retail investor a notice of the need for an urgent replenishment of funds in the sub- account. The Broker carries responsibility towards the investor for timely informing on the status of the investor's sub-account and status of execution of his order for purchase of shares. 17. On December 24, 2012 after completing settlements, funds will be written off the brokerage accounts of Retail investors and APFs. The Broker shall send to his clients a notice of crediting of securities with a copy of the exchange certificate. 18. On the next day after settlements completion, trading for secondary circulation of securities will be opened at the Exchange. That means that the Retail investor as of December 25, 2012 will be able to put up through his Broker an order for selling of his shares or purchase of additional shares. Purchase/selling of shares on the secondary market will be carried out at prices which are fixed in the market according to the demand and supply. 19. The Retail investor may request from the Broker and the Broker must provide an extract from the brokerage account which will be a documentary certificate of shares ownership. Note: Securities do not exist in the paper form, but only in the form of a record in an account. An extract from the broker, registrar or custodian bank is a document confirming securities ownership. Details of JSC "KazTransOil" are contained in the Investment memorandum placed on the website of JSC "Kazakhstan Stock Exchange" at http://www.kase.kz/files/emitters/KZTO/kztof7_2012.pdf , as well as on the official website of JSC "KazTransOil" at http://www.kaztransoil.kz/ru/akcioneram_i_investoram/informaciia_dlia_akcionera_i_investora/svedeniia_o_cennih_bumagah/ The Investment memorandum of JSC "KazTransOil" contains detailed information about the structure of the Company's assets and operations, history and main directions of its development, about operating results and financial indicators, corporate governance system, strategy and investment projects and intentions. A separate chapter of the Investment Memorandum of JSC "KazTransOil" is devoted to main risk factors related to implementation of the Company's offer. JSC "KazTransOil" registered at 19 Kabanbai batyr, Astana, Republic of Kazakhstan 010000, is a participant of the "People's IPO" Program, whereby 38,463,559 ordinary shares of JSC "KazTransOil" will be offered to citizens of the Republic of Kazakhstan and pension funds incorporated in accordance with the legislation of the Republic of Kazakhstan. Official website of JSC "KazTransOil" - www.kaztransoil.kz. JSC "KazTransOil" is a subsidiary organization of JSC "NC KazMunayGas"; it is the largest oil transportation company in Kazakhstan owning a network of oil pipelines and water pipes of a total length of about 8 thousand km. JSC "KazTransOil" transports around 59% of the total volume of oil produced in the country abroad and to domestic consumers. Not for public distribution or publication, directly or indirectly, on the territory of USA, Australia, European economic zone, Canada, Russian Federation or Japan. [2012-12-05]