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(Translation) Information Memorandum on Disposition and Acquisition of Assets of Pathum Thani Water Co., Ltd. and Connected Transaction The Board of Directors Meeting No. 4/2007 of CH. Karnchang Public Company Limited, held on March 26, 2007, passed a resolution for the Company to sell its ordinary shares in Pathum Thani Water Co., Ltd. to Thai Tap Water Supply Public Company Limited and/or persons and/or legal entities which have no connection with the Company and in case that Thai Tap Water Supply Public Company Limited would purchase ordinary shares in Pathum Thani Water Co., Ltd. from the current shareholders (except the Provincial Waterworks Authority) wishing to sell such shares, as per the following details: 1. Transaction Date After receipt of approval from the Shareholders Meeting for execution of the transactions and after Pathum Thani Water Co., Ltd.'s registration for capital decrease with the Department of Business Development.The company shall notify the Stock Exchange of Thailand upon having an agreement regarding the confirmed price as well as purchaser. Thus,the Company shall notify the puplic through the Stock Exchange of Thailand's system thenceforth. 2. Contractual Parties 2.1CH. Karnchang Public Company Limited sells shares in Pathum Thani Water Co., Ltd. 1) Seller: CH. Karnchang Public Company Limited Purchaser: Thai Tap Water Public Company Limited and/or persons and/or legal entities which have no connection with the Company Amount of Shares : Not exceeding 5,567,371 shares or not exceeding 46.39 percent of the registered capital (Number of shares after the capital decrease) Transaction Value : Not less than Baht 332 per share or in the total transaction value of not less than Baht 1,848,367,172 Relationship : Person and/or legal entities having no connection with the Company 2.2Thai Tap Water Supply Public Company acquires shares in Pathum Thani Water Co., Ltd. 1) Seller : CH. Karnchang Public Company Limited Purchaser : Thai Tap Water Public Company Limited Amount of Shares : Not exceeding 5,567,371 shares or not exceeding 46.39 percent of the registered capital (Number of shares after the capital decrease) Transaction Value : Not less than Baht 332 per share or in the total transaction value of not less than Baht 1,848,367,172 and not exceeding Baht 365 per share or in the total transaction value of not exceeding Baht 2,032,090,415 Relationship : Person and/or legal entities having no connection with the Company2)Seller : Capital Rice Company LimitedPurchaser : Thai Tap Water Public Company Limited Amount of Shares : 1,883,919 shares or 15.70 percent of the registered capital(Number of shares after the capital decrease) Transaction Value : Not less than Baht 332 per share or in the total transaction value of not less than Baht 625,461,108 and not exceeding Baht 365 per share or in the total transaction value of not exceeding Baht 687,630,435 Relationship : Person having no connection with the Company 3)Seller : Mahasiri Siam Co., Ltd. Purchaser : Thai Tap Water Public Company Limited Amount of Shares : 3,662,528 shares or 30.52 percent of the registered capital (Number of shares after the capital decrease) Transaction Value : Not less than Baht 332 per share or in the total transaction value of not less than Baht 1,215,959,296 and not exceeding Baht 365 per share or in the total transaction value of not exceeding Baht 1,336,822,720 Relationship : Person having connection with the Company by holding share in CH.Karnchang Public Company Limited for 22.10% 4)Seller : CH. Karnchang Holding Co., Ltd Purchaser : Thai Tap Water Public Company Limited Amount of Shares : 261,502 shares or 2.18 percent of the registered capital (Number of shares after the capital decrease) Transaction Value : Not less than Baht 332 per share or in the total transaction value of not less than Baht 86,818,664 and not exceeding Baht 365 per share or in the total transaction value of not exceeding Baht 95,448,230 Relationship : Person having connection with the Company by holding share in CH.Karnchang Public Company Limited for 11.53% 5)Seller : TMB Bank Public Company Limited Purchaser : Thai Tap Water Public Company Limited Amount of Shares : 192,209 shares or 1.60 percent of the registered capital (Number of shares after the capital decrease) Transaction Value : Not less than Baht 332 per share or in the total transaction value of not less than Baht 63,813,380 and not exceeding Baht 365 per share or in the total transaction value of not exceeding Baht 70,156,285 Relationship : Person having no connection with the Company 5)Seller : Krung Thai Bank Public Company LimitedPurchaser : Thai Tap Water Public Company Limited Amount of Shares : 192,209 shares or 1.60 percent of the registered capital (Number of shares after the capital decrease) Transaction Value : Not less than Baht 332 per share or in the total transaction value of not less than Baht 63,813,380 and not exceeding Baht 365 per share or in the total transaction value of not exceeding Baht 70,156,285 Relationship : Person having no connection with the Company 3. General Characteristics of the Transaction The Company currently holds shares in two companies operating business of production and distribution of tap water. The Company holds shares in Pathum Thani Water Co., Ltd. at the ratio of 46.39 percent of the registered and paid-up capital and holds shares in Thai Tap Water Supply Public Company Limited at the ratio of 47.69 percent of the registered and paid-up capital. Pathum Thani Water Co., Ltd. operates the business of production and distribution of tap water, under a concession granted by the Provincial Waterworks Authority ("PWA") to produce and distribute tap water to PWA and PWA will further sell and distribute such tap water to the people in the area of Pathum Thani Province with the concession period of 25 years from 1998, 2023. Currently, Pathum Thani Water Co., Ltd. has the registered and paid-up capital of Baht 2,752 Million, divided into 27.5 million ordinary shares at the par value of Baht 100 per share. The company is in the process of capital decrease by Baht 1,552 Million to Baht 1,200 Million. It is expected to complete the decrease of the registered capital in June 2007. Thai Tap Water Supply Public Company Limited operates the business of production and distribution of tap water, under a concession granted by PWA to produce and distribute tap water to PWA and PWA will further sell and distribute such tap water to the people in the areas of Nakhon Pathom Province and Samut Sakhon Province with the concession period of 30 years from July 21, 2004 to July 21, 2034. Currently, Thai Tap Water Public Company Limited has the registered capital of Baht 3,250 Million, divided into 3,250 million ordinary shares at the par value of Baht 1 per share. In case that the purchaser is Thai Tap Water Supply Public Company Limited, the Company intends to restructure the shareholding of Pathum Thani Water Co., Ltd. and Thai Tap Water Supply Public Company Limited prior to further listing Thai Tap Water Supply Public Company Limited on the Stock Exchange of Thailand. In case that the purchasers are the persons and/or legal entities having no connection with the Company, the Company intends to seek a strategic partner to enhance the capacity in business operation so as to accommodate the future expansion of Pathum Thani Water Co., Ltd. As for the case that the purchaser is Thai Tap Water Supply Public Company Limited, the Company has Thai Tap Water Supply Public Company Limited purchase all shares from the current shareholders (except PWA) of Pathum Thani Water Co., Ltd., representing 98.00 percent of the registered and paid-up capital. Thai Tap Water Supply Public Company Limited would purchase ordinary shares from the current shareholders of Pathum Thani Water Co., Ltd. as follows: 3.1 Thai Tap Water Supply Public Company Limited intends to purchase 5,567,371 ordinary shares in Pathum Thani Water Co., Ltd. from CH. Karnchang Public Company Limited at the price of not less than Baht 332 per share or in the total transaction value of not less than Baht 1,848,367,172 and not exceeding Baht 365 per share or in the total transaction value of not exceeding Baht 2,032,090,415. 3.2 Thai Tap Water Supply Public Company Limited intends to purchase 1,883,919 ordinary shares in Pathum Thani Water Co., Ltd. from Capital Rice Company Limited at the price of not less than Baht 332 per share or in the total transaction value of not less than Baht 625,461,108 and not exceeding Baht 365 per share or in the total transaction value of not exceeding Baht 687,630,435. 3.3 Thai Tap Water Supply Public Company Limited intends to purchase 3,662,528 ordinary shares in Pathum Thani Water Co., Ltd. from Mahasiri Siam Co., Ltd. at the price of not less than Baht 332 per share or in the total transaction value of not less than Baht 1,215,959,296 and not exceeding Baht 365 per share or in the total transaction value of not exceeding Baht 1,336,822,720. 3.4 Thai Tap Water Supply Public Company Limited intends to purchase 261,502 ordinary shares in Pathum Thani Water Co., Ltd. from CH. Karnchang Holding Co., Ltd. at the price of not less than Baht 332 per share or in the total transaction value of not less than Baht 86,818,664 and not exceeding Baht 365 per share or in the total transaction value of not exceeding Baht 95,448,230. 3.5 Thai Tap Water Supply Public Company Limited intends to purchase 192,209 ordinary shares in Pathum Thani Water Co., Ltd. from TMB Bank Public Company Limited at the price of not less than Baht 332 per share or in the total transaction value of not less than Baht 63,813,380 and not exceeding Baht 365 per share or in the total transaction value of not exceeding Baht 70,156,285. 3.6 Thai Tap Water Supply Public Company Limited intends to purchase 192,209 ordinary shares in Pathum Thani Water Co., Ltd. from Krung Thai Bank Public Company Limited at the price of not less than Baht 332 per share or in the total transaction value of not less than Baht 63,813,380 and not exceeding Baht 365 per share or in the total transaction value of not exceeding Baht 70,156,285. The volume of the disposition of shares in Pathum Thani Water Co., Ltd. by CH. Karnchang Public Company Limited, if calculated based on transaction value, in accordance with the Stock Exchange of Thailand Notification, Re: Rules, Procedures and Disclosure on Disposition of Assets of Listed Companies, shall represent 6.70 percent. As for the case that Thai Tap Water Supply Public Company Limited acquires shares in Pathum Thani Water Co., Ltd., the transaction volume represents 14.16 percent. Upon combination of acquisition transactions during the past 6 months, the total volume of the transaction shall represent 18.50 percent, which falls into Type 2 Transaction. In this regard, the Company shall be required to report and disclose such transaction to the Stock Exchange of Thailand, and give written notice to shareholders within 21 days from the date on which such transaction is disclosed to the Stock Exchange of Thailand. Furthermore, Thai Tap Water Supply Public Company Limited acquires shares in Pathum Thani Water Co., Ltd. by way of purchasing shares from the current shareholders (except the Provincial Water Authority), comprising Mahasiri Siam Co., Ltd. and CH. Karnchang Holding Co., Ltd., which are major shareholders of CH. Karnchang Public Company Limited.If calculated in accordance with the Stock Exchange of Thailand Notification, Re: Rules, Procedures and Disclosure on Connected Transactions of Listed Companies, the transaction value represents more than 3 percent of the net tangible asset value.However given that the sellers (Mahasiri Siam Co., Ltd. and CH. Karnchang Holding Co., Ltd.) which are major shareholders of CH. Karnchang Public Company Limited, enter into the transactions with their affiliated company (Thai Tap Water Supply Public Company Limited), such transactions are thus not deemed as connected transaction.Nonetheless to ensure transparency and eliminate the problem of conflict of interest, the Company wishes to disclose such transactions to the Stock Exchange of Thailand and will hold the Shareholders Meeting to seek approval of such transactions. The Company therefore will send the Shareholder Meeting Notification Letter as well as the opinion of Independent Financial Advisor,to the shareholder at least 14 days in advance prior to the Shareholder Meeting date,The Company also will send such letter to the Stock Exchange of Thailand prior to sending to the Shareholder at least 5 working days. 4. Details of Disposed Assets A. Nature of Business Name :Pathum Thani Water Co., Ltd. Address :43 Moo 3 Chiang Rak Noi-Bang Sai Road, Tambon Ban Pathum, Amphoe Sam Khok, Pathum Thani Province Nature of Business :Production and distribution of tap water and relevant business as well as maintenance of the tap water production and distribution systems in accordance with the agreement granting the right to produce and sell tap water made between the Company and the Provincial Waterworks Authority, under a concession granted by the Provincial Waterworks Authority, on a Build, Operate and Transfer (BOT) basis, whereby Pathum Thani Water Co., Ltd. would invest in the construction of the tap water production and distribution systems, and upon expiration of the Concession Agreement, the Company shall transfer all ownership of tap water production to the Provincial Waterworks Authority, with the concession period of 25 years from October 15, 1998 to October 15, 2023. B. Board of Directors of Pathum Thani Water Co., Ltd. The Board of Directors of Pathum Thani Water Co., Ltd. comprises a total of seven members as listed below: 1. Mr. Kamthorn Trivivavet Chairman of the Board of Directors 2. Mr. Ratn Santaannop Director 3. Mr. Vorapot Uchupiboonvong Director 4. Mr. Suphon Jiraphan Director 5. Mrs. Sunantha Khemaprapa Director 6. Mr. Vorapong Phitphongsa Director 7. Mr. Dhosaphon Thiparos Director C. Shareholding Structure On January 25, 2007, the registered and paid-up capital of Pathum Thani Water Co., Ltd. amounted to Baht 2,752 Million, divided into 27,520,000 ordinary shares at the par value of Baht 100 per share. The names of the shareholders are as follows: Before Capital Decrease After Capital Decrease Shares % Shares % 1.CH. Karnchang Public Company Limited 12,767,838 46.39 5,567,371 46.39 2.Mahasiri Siam Co., Ltd. 8,399,396 30.52 3,662,528 30.52 3.Capital Rice Company Limited 4,320,453 15.70 1,883,919 15.70 4.CH. Karnchang Holding Co., Ltd. 599,710 2.18 261,502 2.18 5.The Provincial Waterworks Authority 551,000 2.00 240,262 2.00 6.TMB Bank Public Company Limited 440,800 1.60 192,209 1.60 7.Krung Thai Bank Public Company Limited 440,800 1.60 192,209 1.60 8.Thames Water International (Thailand) Co., Ltd. 1 0.00 0 0.00 9.Berli Jucker Public Company Limited 1 0.00 0 0.00 10.Bovis Limited 1 0.00 0 0.00 27,520,000 100.00 12,000,000 100.00 Remark: On January 26, 2007, the Board of Directors of Pathum Thani Water Co., Ltd. resolved to approve the decrease of the company's registered capital by Baht 1,552 Million, from the registered capital of Baht 2,752 Million, by way of decrease of 15,520,000 shares, thereby remaining the registered capital of Baht 1,200 Million divided into 12,000,000 ordinary shares at the par value of Baht 100 per share. Such capital decrease was in accordance with current shareholding proportion so as to minimize accumulated loss. In addition, on February 6, 2007, the Extraordinary General Meeting of the Company approved such capital decrease, whereby it is pending operation of registered capital decrease. D. Summary of Financial Position The summary of the financial position and the results of operation of Pathum Thani Water Co., Ltd., as audited by the auditor, as at December 31, 2003-2005, and the Company's internal financial statements in the year 2006, are as follows: Financial Statements Audited by Ernst & Young Office Limited (Unit: Thousand Baht) (Auditor: Ms. Siraporn Ouaanunkun) 2003 2004 2005 2006 Total assets 4,523,285 4,499,499 4,209,670 4,381,472 Total liabilities 5,499,072 5,530,932 5,238,526 4,864,199 Issued and paid-up capital 1,102,000 1,102,000 1,102,000 1,102,000 Shareholders 'equity (975,787) (1,031,432) (1,028,856) (482,727) Total income 587,869 738,050 853,437 1/1,460,023 Total cost and expenses 447,039 492,186 556,534 577,893 Interest expenses 321,692 301,509 294,327 336,105 Net earnings (loss) (180,862) (55,645) 2,576 546,130 Net earnings (loss) per share (Baht) (16.41) (5.05) 0.23 49.56 (more)