SET Announcements

(Translation) No. CK-08-0000-PO-L-0022 February 5, 2008 Re: Report on Connected Transactions in Respect of Office Building Lease Attn.: President of the Stock Exchange of Thailand CH. Karnchang Public Company Limited (the "Company") hereby reports the connected transaction between the Company and Expert Transport Co., Ltd. and Bang Pa-in Land Development Co., Ltd. whose shares are held by the Company's major shareholder, in respect of execution of the office building space lease agreements, which are deemed connected transactions in the category of short-term rent/lease of real property in accordance with the Stock Exchange of Thailand Notification, Re: Disclosure and Acts of Listed Companies on Connected Transactions B.E. 2546 (2003), whereby the Board of Directors Meeting No. 1/2008, held on February 5, 2008, resolved to approve execution of the transactions, as per the following details: 1. Transaction Date (Agreement Execution Date) February 5, 2008 2. Related Parties Lessees : Expert Transport Co., Ltd. and Bang Pa-in Land Development Co., Ltd. Lessor : CH. Karnchang Public Company Limited 3. General Characteristics and Details of Connected Transactions 3.1 Expert Transport Co., Ltd., whose shares are held by the Company's major shareholder, has agreed to execute the following agreements with the Company: 3.1.1 An office building space lease agreement in Viriyathavorn Building No. 587, 14th Floor, Sutthisarnvinijchai Road, Dindaeng Subdistrict, Dindaeng District, Bangkok, covering a total area of 1,118.62 square meters, at the rental rate of Baht 143,183.36 per month. 3.1.2 A service agreement for air conditioners and facilities in the building under Clause 3.1.1 at the rate of Baht 229,809.29 per month (inclusive of value added tax of Baht 15,034.25). The said agreements have a term of seven months from November 1, 2007 - May 31, 2008. 3.2 Bang Pa-in Land Development Co., Ltd., whose shares are held by the Company's major shareholders, has agreed to execute the following agreements with the Company: 3.2.1 An office building space lease agreement in Viriyathavorn Building No. 587, 17th Floor, Sutthisarnvinijchai Road, Dindaeng Subdistrict, Dindaeng District, Bangkok, covering a total area of 173.79 square meters, at the rental rate of Baht 22,245.12 per month. 3.2.2 A service agreement for air conditioners and facilities in the building under Clause 3.2.1 at the rate of Baht 35,703.42 per month (inclusive of value added tax of Baht 2,335.74). The said agreements have a term of one year from November 1, 2007 - October 31, 2008. 4. Total Transaction Value The total value of the space lease and service agreements of Expert Transport Co., Ltd. amounts to Baht 372,992.65 per month, totaling Baht 2,610,948.55 throughout the agreement term, while the total value of the space lease and service agreements of Bang Pa-in Land Development Co., Ltd. amounts to Baht 57,948.54 per month, totaling Baht 695,382.48 throughout the agreement term. Therefore, the total transaction volume of such two companies is Baht 3,306,331.03. In this regard, such transactions are deemed medium- sized transactions with the value of more than 0.03 percent but less than 3 percent of the Company's net tangible assets, or representing 0.06 percent of the Company's net tangible assets, (the Company's net tangible assets as at September 30, 2007 amounted to Baht 5,802.55 Million), and falls into the category of short-term rent/lease of real property with a period of not exceeding three years which the Company is required to disclose. 5. Details of Related Parties 5.1 Mahasiri Siam Co., Ltd. is the major shareholder of CH. Karnchang Public Company Limited. According to the information from the shareholders register book as at September 21, 2007, Mahasiri Siam Co., Ltd. holds 293,784,788 shares in CH. Karnchang Public Company Limited, representing 20.32 percent of the registered and paid-up capital, and holds shares in Expert Transport Co., Ltd. and Bang Pa-in Land Development Co., Ltd., representing 90 percent and 25 percent of their registered capitals, respectively. 5.2 CK. Office Tower Co., Ltd. is a shareholder of CH. Karnchang Public Company Limited. According to the information from the shareholders register book as at September 21, 2007, CK. Office Tower Co., Ltd. holds 75,000,000 shares in CH. Karnchang Public Company Limited, representing 5.19 percent of the registered and paid-up capital, and holds shares in Bang Pa-in Land Development Co., Ltd., representing 25 percent of the registered capital. 5.3 Mr. Plew Trivisvavet As director and shareholder of CH. Karnchang Public Company Limited, holding shares representing 1.46 percent As director and shareholder of Expert Transport Co., Ltd., holding shares representing 1.98 percent As director and shareholder of Bang Pa-in Land Development Co., Ltd., holding shares representing 8.33 percent As director and shareholder of Mahasiri Siam Co., Ltd., holding shares representing 22.27 percent As director and shareholder of CK. Office Tower Co., Ltd., holding shares representing 12.50 percent 5.4 Mr. Prasert Marittanaporn As director and shareholder of CH. Karnchang Public Company Limited As director and shareholder of Expert Transport Co., Ltd. The details of the shareholding percentage of the connected persons and their directorships in other companies are as follows: Shareholders CH.Karnchang Expert Bang Pa-in Mahasiri Siam CK.Office Public Transport Land Co.,Ltd. Tower Company Co.,Ltd. Development Co.,Ltd. Limited Co.,Ltd. % Director % Director % Director % Director % Director Mahasiri Siam 20.32 90.00 25.00 Co.,Ltd. CK.Office 5.19 - 25.00 Tower Co.,Ltd. Mr. Plew 1.46 / 1.98 / 8.33 / 22.27 / 12.50 / Trivisvavet Mr. Prasert - / - / - - - Marittanaporn 6. Reasons and Necessities of Execution of the Transactions Over the past period, the Company and its group took on lease of Viriyathavorn Building for use as their offices from CK. Office Tower Co., Ltd. Subsequently, on November 1,2007, the Company purchased such building from CK. Office Tower Co., Ltd. for use as office building of the Company and its group, thereby causing the Company to change the lessor under the lease agreements in order to ensure continuation from the existing agreements and continued business operations of the Company and its group. 7. Directors who are interested persons and connected persons comprising Mr. Plew Trivisvavet and Mr. Prasert Marittanaporn did not attend nor vote on this matter at the Meeting. 8. Opinion of the Board of Directors The Board of Directors is of the view that the aforesaid transactions are reasonable and beneficial to the Company since such transactions continue from the existing agreements by changing the lessor under the lease agreements. In addition, such transactions are on an arm's length basis with fair rental and conditions as made by the Company with general parties. 9. Opinion of the Audit Committee and/or the Company's Directors which Differs from the Opinion of the Board of Directors under Clause 8. The Audit Committee is of the view that such execution of the transactions is reasonable since the transactions are on an arm's length basis with fair price and conditions without giving rise to any undue interest and without any differing opinion from the opinion of the Board of Directors under Clause 8. Please be informed accordingly. Very truly yours, (Dr. Anukool Tuntimas) Executive Vice President Human Resource and General Administration 4