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NOTE 20 - DIVIDEND, LEGAL RESERVE AND PROFIT SHARING In 1999 The parent company - 1999 Ordinary shareholders' meeting held on April 30, 1999, the resolution was passed approving appropriated legal reserve by 5% of net profit. Subsidiaries - Ordinary shareholders' meeting held on April 30, 1999, the resolution was passed approving payment of dividend in amount of Baht 30 per share. The joint venture which the company has 59.99% of profit sharing paid the first profit sharing from completed project to the participants according to the notice dated April 20, 1999 in amount of Baht 80 million. The joint venture which the company has 50% of profit sharing paid the fifth profit sharing from the partially completed project to the participants according to the notice dated June 11, 1999 in amount of Baht 80 million. In 1998 The joint venture which the company has 53.2% of profit sharing had completed its projects and paid the second and the third profit sharing to the participants in the amount of Baht 40 million and Baht 200 million, respectively according to the notice dated January 10, 1998 and May 26, 1998, respectively. The joint ventures which the company has 40% and 60% of profit sharing, the project which the company has 40% of profit sharing paid the first and the second profit sharing from completed project to the participants according to the notice dated February 2, 1998 and June 19, 1998 in amount of Baht 20 million and Baht 15 million, respectively and the project which the company has 60% of profit sharing paid the first profit sharing according to the notice dated June 19, 1998 in amount of Baht 15 million. The joint venture which the company has 50% of profit sharing paid the first profit sharing from the partially completed project to the participants according to the notice dated May 12, 1998 in amount of Baht 34 million. NOTE 21 - COMMITMENTS AND CONTINGENT LIABILITIES As at June 30, commitments and contingent liabilities are as follows: - The parent company had commitments from guarantee loans, letter of credit, letters of guarantee issued by banks and discounted notes to joint venture which the company is one of the participants, in the approximate amount of Baht 3,426.6 million and Baht 2,410.7 million in 1999 and 1998, respectively. - In 1999 and 1998, the joint ventures have unused letters of credit with banks in the approximate amount of Baht 72.29 million and Baht 393.2 million, respectively. The commitments from letter of guarantee issued by banks are as follows: (Amounts : Thousand Baht) Consolidated CH. Karnchang Public Co., Ltd. 1999 1998 1999 1998 Guarantee of construction contract, bid, and payment 6,783,579 6,807,246 1,814,434 1,136,249 Advance Payment Bond and Retention 4,148,263 4,877,414 353,198 172,523 Guarantee of loss revenue due to damage caused by transportation, retention bond, rental equipment, electricity and letter of credit 902,463 1,295,943 677,500 844,759 One of the joint venture transferred its right to received work value from employer to secured its bank guarantee. Foreign currency In 1999 The joint venture which the company has 35% of profit sharing has commitment with banks from forward contracts in amount of USD 31.37 million. The joint venture which the company has 25% of profit sharing has made 27 foreign exchange forward contracts in totalling amount of Yen 2,700 million with a commercial bank which pledged by fixed deposit in amount of Baht 31.5 million and guaranteed by the participant. This contract may raise gain or loss from exchange rate in the future. These contracts will be due in 1999 and 2000. Other contracts In 1999 A subsidiary company has the outstanding balance of the remained sale construction supplies contract in the approximate amount of Baht 3.4 million and from other rental contracts. Subsidiary company has rental concrete plant and rubber plant contract by monthly rental payment of Baht 2,013,000 per month. The rental period is 1 year, ending on May 1, 2000. The joint venture which the company has 35% of profit sharing has made 2 land rental agreements for 3 year and 4 year periods. The rental rate is Baht 13,500 per month per rai and Baht 618,000 per annum , respectively. The joint venture which the company has 25% of profit sharing has a commitment from the outstanding balance of purchase construction supplies contract with subsidiary company in the approximate amount of Baht 3.19 million, vehicle rental agreement in the approximate amount of Baht 31.65 million and land rental agreement for constructing a factory producing construction supplies and for located a temporary office in the approximate amount of Baht 24.1 million. Other matters In 1999 The joint venture which the company has 59.99% of profit sharing was claimed to compensate on its staff lay off in the approximate amount of Baht 6.2 million. The case is in the consideration of court. The joint venture which the company has 35% of profit sharing has a claim against the employer. This claim is under consideration of employer's approval of work done which the joint venture has cost incurred in the approximate amount of Baht 70 million. And the joint venture was sued for Baht 2 million compensation incurring from working over due the peroid that specified by the law. The case is on trial of Labor Court. NOTE 22 - RECLASSIFICATION Certain transactions for 1998 financial statements have been reclassified to conform with the 1999's financial statements presentation. Certain transactions for 1999 financial statements have been reclassified in accordance with generally accepted accounting principles applied for financial statements of fiscal year 1999. NOTE 23 - DISCLOSURE OF SEGMENT INFORMATION The parent company, subsidiaries and joint ventures operate their constructions only in Bangkok and region. Therefore, segment information is not available. NOTE 24 - SUBSEQUENT EVENTS In July 1999, the joint venture which the company has 35% of profit sharing had an outstanding balance of loan to a commercial bank which might affect the joint venture. The lender has the right of immediately claim for whole principal and accrued interest repayment according to the agreement. As at June 30, 1999, the whole principal and accrued interest repayment are in amount of Baht 240.8 million and Baht 385,939.73, respectively. NOTE 25 - IMPROVEMENT COMPUTERIZED SYSTEM FOR YEAR 2000 (Y2K) (UNREVIEWED AND NOT FORMING PART OF REVIEW REPORT) The year 2000 problem arises because many computerized systems use two digits rather than four to identify a year. Date-sensitive systems may recognize the year 2000 as some other year, resulting in errors when information using year 2000 dates is processed. Entities may experience the effects of the Year 2000 problem before, on, or after January 1, 2000, and the effects on operations and financial reporting, if not addressed and repaired properly and timely, may range from minor errors to significant systems failure which could affect an entity's ability to conduct normal business operations. In addition, it is not possible to be certain that all aspects of the Year 2000 problem affecting the entity, including those related to the efforts of customers, suppliers, or other third parties, will be fully resolved. The company started computer improvement to solve problem of Y2K. As at June 30, 1999 the improvement has been finished. The company recorded these expenses in the incurred period. As at June 30, 1999 the company recorded these expenses in totalling amount of Baht 1.67 million. However, the company still having risk in dealing with others who may be unable to solve the computerized system in time. The ultimate effect can not presently be determined but not expected to be material. Major subsidiary and joint venture, in overall have considered specific critical system which impact their ongoing operation and have considered that there is no impact of year 2000 to their operations. The same as parent company, they still having risk in dealing with others who maybe unable to solve the computerized system in time. The ultimate effect can not presently be determined but not expected to be material.