(Baht 1 per share for 16,601,500 shares) and approved the appropriation of general reserve amounting to Baht 3,000,000. In addition, the Board has approved the appropriation of legal reserve at 5% of 1998 net income amounting to Baht 3,177,628. Payment of dividends (including the interim dividends at Baht 1.50 per share for 16,601,500 shares approved by the Board of Directors during 1999) and the appropriation of general and legal reserve were approved by the shareholders at the ordinary meeting held on April 30, 1999. The Company subsequently paid the dividends on May 17, 1999. At the Board of Directors' meeting held on December 17, 1999, the Board of Directors approved the payment of interim dividends out of earnings during January 1, 1999 to September 30, 1999 totalling approximately Baht 16.6 million (Baht 1 per share for 16,601,500 shares). In addition, management has proposed the appropriation of legal reserve at 5% of 1999 net income amounting to Baht 1,750,784. At the Board of Directors' meeting held on March 22, 2000, the Board of Directors approved the payment of interim dividends out of earnings during October 1, 1999 to December 31, 1999 totalling approximately Baht 16.6 million (Baht 1 per share for 16,601,500 shares). Payment of dividends and the appropriation of legal reserve were approved by the shareholders at the ordinary meeting held on April 26, 2000. Under the provisions of the Limited Public Company Act B.E. 2535, the Company is required to appropriate at least 5% of its annual net income after deduction of the deficit brought forward (if any) as reserve fund until the reserve reaches 10% of authorized share capital. The reserve fund is not available for dividend distributions. 7. AGREEMENTS As at March 31, 2000, the Company had: a. Long-term land lease agreement for a period of 30 years which can be extended for another period of 30 years. The Company is committed to pay the rental at Baht 60,000 per annum. - 4 - b. Long-term lease agreements with various lessors covering vehicles and computers for a period of 36 months ending on various dates up to August 2001. The Company has to pay the rental totalling approximately Baht 2.4 million per annum. c. Lease agreements for posting advertising billboards, for which the Company is committed to pay the rental of approximately Baht 1.2 million per annum. 8. CONTINGENT LIABILITIES As at March 31, 2000, the Company : a Was contingently liable for letters of guarantee issued by a local bank in favour of certain Government agencies and state enterprises totalling approximately Baht 24 million. These letters of guarantee are collateralized by the mortgage/pledge of a portion of the Company's land, buildings, machinery and equipment. b. The result on the tax audit by the Revenue Department regarding the refund of the corporate tax for the year 1996 was reported to the Company. The Company recorded the tax and penalty assessed by the Revenue Department amounting to approximiately Baht 4.3 million in the 1999 financial statements. However, the Company is in the process of appealing for the waiving of penalty of approximately Baht 1.9 million (not yet recorded in the account) of which the Company believes that the outcome will be in the Company's favor. 9. RECLASSIFICATION OF ACCOUNTS Certain accounts in the 1999 interim financial statements have been reclassified to conform with the 2000 interim financial statements presentation. 10. SEGMENT FINANCIAL INFORMATION The Company does not present the segment financial information in the interim financial statements since the Company is engaged in only the manufacturing and distribution of soft drink. 11. CURRENT ECONOMIC SITUATION The operations of the Company have been affected, and may continue to be affected for the foreseeable future, by the adverse economic conditions in Thailand and in the Asia Pacific region, including the volatile foreign exchange rates, slowdown in economic growth and the general deterioration of the economies of countries in the Asia Pacific region. Further, it is not possible to determine the future effect that a continuation of the economic crisis may have on the Company's liquidity and earnings. The accompanying financial statements do not include any adjustment that might result from these uncertainties. - 4 - 12. COMPUTER REMEDIATION PLAN FOR THE YEAR 2000 ("UNAUDITED") The Company has already completed the computer remedial plan for the year 2000 problems. However, the Company still faces risk that other companies with whom the Company does business may be unsuccessful in their computer remedy projects. Management believes that the possible impact, if any, will not be material to the Company's future operations.