Content

2 Message from Boards Directors 4 Company Information 6 Financial Information 7 Nature of Business 20 Shareholder Structure and Management 36 Board of Directors 38 Organization Chart 40 Project Information 46 Map 47 Market and Competition 55 Real Estate Industry Outlook and Trend 59 Others information 66 Management and Authorized Person of the company 70 Details of Directors 71 Executives’ Remuneration 73 Corporate Governance 82 Reference 83 Connected Transactions with Related Persons 87 Risk Factors 91 Explanation and Analysis of Financial and Operating Results 104 Report of Independent Auditor 105 Balance Sheets 113 Note to Consolidated Financial Statements 149 The Board of directors’ responsibilities 150 Audit committee report 152 Audit Fee Accuracy

ANNUAL REPORT 2010 PROPERTY PERFECT 1 Message from Board of Directors

“At end-2010, the Company showed consolidated revenue of Bt8.616 billion “from land and house as well as condominium sales, representing a 47% increase from 2009”

In 2011, despite negative factors like upward interest trends, which would “ affect consumer Confifif idence and purchasing power, the Board of Directors remains Conf ifident of the bright outlook. Several positive factors remain like the continued economic expansion which would further boost housing demand.

On the back of continued financial crisis in the US and Europe, Asia with higher economic growth rates” benefits from higher capital inflows. Thailand was included, reflected through the baht appreciation. Though, political turbulence definitely destroyed the tourism and investment atmosphere. Luckily, the riots happened after the end of incentives - transfer and mortgage registration fees as well as special business tax - on 28 March 2010. Housing transfers in the Greater Bangkok hit a record at 38,800 units in March. Though deduction on transfer and mortgage registration fees was extended to end-June, 2010, such did not help boost the property market in the second quarter.

Late 2010, Bank of Thailand issued the loan to value ratio (LTV) measure to keep housing loan activities in check, particularly for property purchases below Bt10 million. Starting from 1 January 2011, financial institutions’ risk weight from condominium loans is 30% if the loan does not exceed 90% of house value, but it is raised to 75% if the loan exceeds 90%. This measure is aimed at reigning speculation in the condominium market, following oversupplies.

At end-2010, the Company showed consolidated revenue of Bt8.616 billion from land and house as well as condominium sales, representing a 47% increase from 2009. The consolidated net profit was Bt550 million, up 38% on year. The Board of Directors would ask for shareholders’ approval for dividend payment of Bt0.33 per share.

Per earlier notification to shareholders of the Company’s plan to extend its product range to reach a wider scale of consumers, the Company received warm welcome for the new brand, The Villa. Launched in 3 locations the middle of last year, the medium-sized projects featuring 2-storey townhouses at the price of approximately Bt2 million demonstrate advantages over others in terms of quality and designs. This year, at least 2 more projects will be introduced based on the Company’s experience and success, and the size of revenue generated by “The Villa” brand would become more significant.

2 PROPERTY PERFECT ANNUAL REPORT 2010 In condominium segment, for units priced about Bt1 million, the Company offered the I-Condo brand in 3 locations. It was warmly welcomed thanks to the modern style and affordable price. A new project will be launched this year. The Company will this year unveil the first rental condominium under Uniloft brand, near Chiangmai University. The second would be located close to Mahidol University. I-Condo and Uniloft are part of the Company’s new business plan, and the construction works would be accelerated to realise revenue late 2011 or early 2012 at the latest.

In 2011, despite negative factors like upward interest trends, oil price-induced inflation, higher construction cost and minimum wages, as well as the Bank of Thailand’s LTV measure which would affect consumer confidence and purchasing power, the Board of Directors remains confident of the bright outlook. Several positive factors remain like the continued economic expansion which would further boost housing demand. The House dissolution for an election will stabilise the political situation. Large developers stand to hold an advantage over small ones due to excess liquidity in the financial market. Last, the more concrete mass transit development plans will offer new potential locations. This convinces us of continued expansion in the property sector from 2010.

The Company plans to unveil a total of 14 projects with combined value of Bt16.535 billion. The development portfolio will be then enlarged to encompass 37 projects. To strengthen the Company’s financial position for the expansion, the Board of Directors thus proposes shareholders approve a capital increase. If approved, the right offering would increase the capital base by Bt787.73 million. Combined with 3-year warrants issued to existing shareholders for the exercise prices of Bt393.87 million, the Company would raise a total of Bt1.182 billion, or 20 per cent of registered capital. The new fund will finance new projects to raise the future revenue and profits, which will return to shareholders in the form of dividend. The new shares will also increase the Company’s share trading liquidity.

Last, the Board of Directors would like to express gratitude to all supporters who are shareholders, customers, financial institutions, media and business partners who have placed trust in the Company. Plus the executive team and employees’ dedication to develop quality goods and services for maximum customer satisfaction in the past years, this will push the Company towards a stable and sustainable growth.

Twatchai Nakata Chainid N. Sirimanee Chairman Chief Executive Officer

ANNUAL REPORT 2010 PROPERTY PERFECT 3 Company Information

Name : Property Perfect Public Company Limited Head Office 17th Flr. Vorasombat Bldg. 100/1 Rama IX Road, Huaykwang Bangkok 10310 Tel. 0 2245 6640-7 Fax. 0 2247 3328 Type of Business : Real Estate Development, with focus on housing development for sale in Greater Bangkok under brands “Maneerin Lake & Park”, “Perfect Park”, “Perfect Place”, “Perfect Masterpiece”, “The Metro”, “The Villa”, “Metro Park”, “Metro Sky”, “ I Condo” and “ Uniloft” No. of Paid-up Share : 787,724,120 Share (31 December 2010) Par Value : Baht 6 Paid-up Capital : Baht 4,726,344,720

4 PROPERTY PERFECT ANNUAL REPORT 2010 Investment in Other Companies

Registered Paid-up Percentage of Name and Address Type of Business Capital (MB) Capital (MB) Investment Estate Perfect Co., Ltd. 1,200 1,200 100.00% Real Estate 17th Flr., Vorasombat Bldg., Development 100/1 Rama IX Road, Huaykwang Bangkok Tel. 0 2245-6640-7 Fax. 0 2645-1976 Bright Development Bangkok Co., Ltd. 17th Flr., Vorasombat Bldg., 500 500 100% Real Estate 100/1 Rama IX Road, Development Huaykwang Bangkok Tel. 0 2245-6640-7 Fax. 0 2645-1976 Centrepoint Shopping Mall Co., Ltd. 500 150.7 100% Real Estate 17th Flr., Vorasombat Bldg., Development 100/1 Rama IX Road, Huaykwang Bangkok Tel. 0 2245-6640-7 Fax. 0 2645-1976 Residence Number Nine Co., Ltd. 1,000 1,000 100% Real Estate 17th Flr., Vorasombat Bldg., Development 100/1 Rama IX Road, Huaykwang Bangkok Tel. 0 2245-6640-7 Fax. 0 2645-1976 Perfect Sport Club Co., Ltd. 1 1 99.98% Manage Fitness 19th Flr., Vongvanich B Bldg., and Clubhouse 100/52 Rama IX Road, Huaykwang, Bangkok Tel. 0 2645-1406-8 Fax. 0 2645-1409 Krungthep Land Plc. 2,230 1,780 20.22% Real Estate 21th Flr., Vorasombat Bldg., Development 100/1 Rama IX Road, Huaykwang, Bangkok Tel. 0 2645-0960-3 Fax. 0 2645-0380 Real Service Co., Ltd. 40 40 19% Home Service 100/9 Soi Ta-it, Rattanathibet Road, Nonthaburi Tel. 0 2594-4001-5 Fax. 0 2594-4021

ANNUAL REPORT 2010 PROPERTY PERFECT 5 Financial Information

Property Perfect Plc.

Unit : Million Baht Consolidated The Company Only Financial Position 2010 2010 2009 2008 Total Assets 19,729 17,318 13,099 11,525 Project Development Cost and Land for Development 15,616 11,027 9,866 8,670 Total Liabilities 12,555 10,551 6,674 5,203 Shareholders’ Equity 7,174 6,767 6,425 6,322 Operation Results Sales 8,616 7,462 4,846 6,834 Total Revenue 8,704 7,586 4,977 6,935 Gross Margin 2,817 2,434 1,498 2,125 Net Income 550 538 386 798 Financial Ratio Return on Total Revenue 6.32% 7.09% 7.76% 11.51% Return on Equity 7.87% 8.15% 6.06% 13.26% Return on Total Assets 3.22% 3.54% 3.14% 6.80% Current Ratio 2.91 2.21 2.45 4.19 Quick Ratio 0.48 0.41 0.21 0.25 Per Share Data Unit : Baht Net Income per share 0.69 0.68 0.49 1.01 Dividend 0.33 0.33 0.25 0.36 Book value 9.11 8.59 8.16 8.51

6 PROPERTY PERFECT ANNUAL REPORT 2010 Nature of Business

Background and Major Milestones Property Perfect Public Company Limited was established on 14 August 1985, by a group of executives of Maneeya Estate, with initial registered capital of Bt3,000,000.In 1993, the company was registered as a public company and listed on the Stock Exchange of Thailand, in the Property Sector.

Following the 1997 financial crisis, the company like other local developers suffered dearly. On 19 February 2001, the company was ordered by the Central Bankruptcy Court to fall under business rehabilitation. The rehabilitation plan won the Court’s approval on 2 October 2001. The company followed through the conditions of the rehabilitation plan and debt restructuring. The company filed a request to exit the rehabilitation plan and the Court’s consent was issued on 12 April 2004.

The company has extensively expanded the business and undergone capital increases and reduction. As of 31 December 2010, the company’’s registered capital stood at Bt6,552 million with 1,092 million shares at Bt6 par value while the paid-up capital totaled Bt4,726.3 million or 787.7 million shares at Bt6 par value. Rehabilitation process 2008: The company repaid Bt383 million loans to creditors in the rehabilitation plan.

2009: The company repaid Bt299 million loans to creditors in the rehabilitation plan.

As of now, the outstanding debt burden to creditors in the rehabilitation plan stands at Bt37 million. The company is in the process to make the creditor ready for the repayment.

A number of 42.06 million units of warrants have been exercised. The outstanding units as of 31 December 2010 total 8,863,476.

ANNUAL REPORT 2010 PROPERTY PERFECT 7 Investment Structure

Property Perfect Plc.

Real Estate Units Services-Oriented Units

100% 99.98% 19% Estate Perfect Co., Ltd. Perfect Sport Club Co., Ltd. *** real Service Co., Ltd.. * 100% Bright Development Bangkok Co., Ltd. 100% 20.22% Centrepoint Shopping Mall Co., Ltd. Krungthep Land Plc.

100% 51% Residence Number Nine Co., Ltd. Riverside Homes Development Co., Ltd.**

Note: ... * Not operational yet ** Business operation discontinued *** Develop “The Pano” condominium. The remaining 49% stake is owned by a Singaporean group, represented by Fraser (Thailand) Pte Ltd. **** Renamed from Perfect Satellite Services

Overview of Property Perfect Group of Companies The company's investment in subsidiaries and affiliates can be put into 2 main categories. 1. Property development, consisting of 4 subsidiaries and 1 affiliate 2. Services, consisting of 1 subsidiary and 1 affiliate

Business units focusing on development for sale The company and subsidiaries are mainly involved with the property development for sale. The projects involve the development of single detached houses, townhouses, and low-rise condominiums. The company and subsidiaries normally put the construction of designed houses in the hands of contractors, but the construction process will be inspected by in-house engineers and architects at all stages.

The projects of the company and subsidiaries are located in Bangkok and peripheral aeras as well as potential provinces.

In 2011, a subsidiary ventures into Chiang Mai in the North, of which potential is demonstrated through the growing number of population and infrastructure development. It also locates famous educational institutions (Chiangmai University and others) and has been a major tourist destination of Thailand. “Uniloft” brand is introduced in the province, targeting students and investors. The company is also exploring possibilities to expand the investment into potential provinces in other regions like the South, the East and the Northeast.

Property Perfect Public Company Limited Developing housing estates and low-rise condominiums. As of 31 December 2010, a total of 19 projects are under development with outstanding value of Bt15,908.55 million. Six new projects will be launched in 2011, with total value of Bt11,175million.

8 PROPERTY PERFECT ANNUAL REPORT 2010 Estate Perfect Co.,Ltd. (Subsidiary) Estate Perfect Company Limited, located at 100/1 Varasombat Bldg., Floor 17, 100/1 Rama 9 Road Huay Khwang, Bangkok, develops housing states mainly in the East of Bangkok and townhouses under “The Villa” brand.

As of 31 December 2009, Estate was registered with Bt1,000 million of capital, all paid-up, consisting of 100 million shares at Bt10 par value. The company owns the entire 100% stake. The Board of Property Perfect Public Company Limited, at the 1/2010 meeting on 22 January 2010, approved Estate’s capital increase from Bt1,000 million to Bt1,200 million by the issuance of 200 new shares at Bt10 par value. The capital increase was completed in March 2010.

In 2010, Estate expanded through small townhouse projects covering 30-50 rai each. Under “The Villa” brand, there are 2 projects priced between Bt1.8-Bt2 million is designed to increase the share in the townhouse segment.

Three single-house projects are now under development. As of 31 December 2010, the projects’ value was Bt3,120 million. Estate is also developing two “The Villa” 2-storey townhouse projects worth totally Bt909 million.

ANNUAL REPORT 2010 PROPERTY PERFECT 9 Estate’s 4 directors are: Name Position 1. Mr. Chainid Ngow-Sirimanee Director 2. Mr. Pramote Rermyindee Director 3. Mr. Pornswat Katechulasriroj Director 4. Mr. Nantachart Kliebphipat Director

Bright Development Bangkok Co.,Ltd. (“Brught”) (Subsidiary) Located at 100/1 Vorasombat Building (17th flr), Rama IX Road, Huay Kwang, Bangkok, Bright Development was established on the Board’s resolution at the 4/2007 meeting on 30 April 2007 for condominium development. The company owned 99.94% of Bright’s Bt1,000,000 capital.

As of 31 December 2010, Bright’s registered capital increased to Bt500 million from Bt1 million, following the Board of Property Perfect Public Company Limited, at the6/2009 meeting on 12 November 2009, approved the company’s investment in 4,990,000 shares of Bright at Bt100 apiece. The investment boosted the company’s holding to 100%. The capital increase was completed in March 2010.

As of 31 December 2010, Bright has 4 projects under development under “Metro Sky” and “i-Condo” brands with combined value of Bt3,558 million. (See Strategies on Product)

In 2011, Bright launches investment in two condominium projects under “Uniloft” brand with combined value of Bt2,060 million. Priced Bt1-Bt1.2 million per unit, they are located near universities.

10 PROPERTY PERFECT ANNUAL REPORT 2010 Bright’s 4 directors are; Name Position 1. Mr. Chainid Ngow-Sirimanee Director 2. Mr. Pramote Rermyindee Director 3. Mr. Pornswat Katechulasriroj Director 4. Mr. Wicharn Siriwetwarawut Director

Residence Number Nine Compay Limited (“Estate”) (Subsidiary) Residence Number Nine Company Limited (Residence), located at 100/1 Vorasombat Building (17th flr), Rama IX Road, Huay Kwang, Bangkok, is capitalized at Bt1,000 million with 10 million shares at Bt100 par value. Owned 100% by the company, Residence focuses on low-rise residential development.

Residence becomes a subsidiary as the company bought 10 million shares or 100% from old shareholders at Bt507 million, close to the book value, following the resolution from the 1/2010 Board of Directors meeting on 22 January 2010. Residence was taken over as the company planned to develop single houses and townhouses on a 164-rai plot in Bang Buathong, Nonthaburi, which is the only piece of asset of Residence. As of 31 December 2010, Residence has two projects underway – a single house project and a townhouse project worth totally Bt2,158.44 million.

Residence’s 3 directors are: Name Position 1. Mr. Wicharn Siriwetwarawut Director 2. Mr. Sanpetch Sukkasem Director 3. Mrs. Tanyawadee Chalmers Director

Krungthep Land Public Company Limited (Krungtep Land) (Affiliate) Krungthep Land Public Company Limited, located at 100/1 Vorasombat Building (21th flr), Rama IX Road, Huay Kwang, Bangkok, is a property development company focusing on Bangkok and peripheral provinces.

As of 31 December, Krungthep Land is capitalized at Bt2,230 million (paid-up at Bt1,780 million or 178 million shares at Bt10 par value). The company owns 20.22% in the company. (See Note in Financial Statements No.13.1) Shareholders of Krungthep Land are as follows:

Shareholders No. of shares % of total 1. Fraser (Thailand) Pte Ltd 72,000,000 40.45 2. Property Perfect Public Co.,Ltd. 35,999,964 20.22 3. Dr. Bichit Rattakul 25,000,000 14.04 4. Mr. Wichai Thongtang 15,000,000 8.43 5. Mrs. Nualla-or Khunphlin 15,000,000 8.43 6. Mr. John Logan 9,500,000 5.34 7. Mrs. Nada Nimkiatkhachorn 5,000,000 2.81 8. Minor shareholders 500,036 0.30 Total 178,000,000 100.00

ANNUAL REPORT 2010 PROPERTY PERFECT 11 Krungthep Land’s board of directors consists 13 members as follows:

Name Position 1. Dr. Bichit Rattakul Chairman 2. Mr. Thongchai Kunakornporamat Director, Chief Executive Officer 3. Mrs. Uraiwan Bhatarakarnt Director, Executive director 4. Mr. Chan Kim Fai Director, Executive director 5. Mr. Chainid Ngow-Sirimanee /1 Director 6. Miss Wilawan Leongnarktongdee Director 7. Mr. Seang Fuke Seng Director 8. Mr. Chia Khong Shoong Director 9. Mr. Lim EE Seng Director 10. Mr. Attapong Pornthiti Director 11. Mr. Prasong Vararattanakul Director, Independent director, Chairman of Audit Committee 12. Mr. Kiangkai Jiwanant Director, Independent director, Member of Audit Committee 13. Mrs. Anchalee Chavanit Director, Independent director, Member of Audit Committee

Note : /1 Mr. Chainid Ngowsirimanee is a director of the company and he is a director of Krungthep Land as the company owns a 20.22% in the Krungthep Land. Mr. Chainid is a shareholder and a director of (1) Property Perfect Public Company Limited who holds 6,650,000 shares at Bt6 apiece or 0.84% as of 28 February 2010.

In 2010, Krungthep Land’s development portfolio contains 11 projects with outstanding value of Bt7,715 million.

Centrepoint Shopping Mall Co.,Ltd. (“Centerpoint”) (Affiliate) Centrepoint Shopping Mall Co.,Ltd’s located at 100/1 Vorasombat Building (17th flr), Rama IX Road, Huay Kwang, Bangkok. Established in December 2007 on the company’s Board resolution at the 8/2007 meeting on 24 September 2007, it was capitalized at Bt1,000,000, at Bt100 apiece ,all paid-up.

Centrepoint focuses on commercial development like shopping malls and rental office building. The company owns 59.99% in Centrepoint, and owning the other 40% is Timberline Investments Pte Ltd (Major-owned by Arangannal S/O Kathamuthu which has no connection with the company)

The 1/2010 Board of Directors meeting on 22 January 2010 approved the purchase of 4,000 shares or 40% of Centrepoint from Timberline Investments Pte Ltd, which increased the company’s shares to 9,999 shares or 99.99%, to turn Centerpoint into a subsidiary. The Board also approved the capital increase in the subsidiary by Bt499 million from Bt1 million (10,000 shares at Bt100 par value). Centrepoint’s registered capital is now Bt500 million and 30% of new capital or Bt149.7 million was paid-up. This raised Centrepoint’s paid-up capital to Bt150.7 million. After the capital increase, the company owns 100% in Centrepoint, which has not yet launched any project.

12 PROPERTY PERFECT ANNUAL REPORT 2010 Services-oriented units Perfect Sport Club Company Limited Perfect Sport Club Company Limited (formerly Perfect Satellite Services), located at 100/52 Vongvanij B Building (19 flr.), Rama IX Road, Huay Kwang, Bangkok, was established in March 2003. As of 21 June 2005, it was capitalized at Bt1 million. Perfect Sport Club manages the fitness centers, clubhouses and entertainment properties of companies in Perfect Group. It is now 99.98% owned by the company. Following a change late 2010, it has five directors in charge of management and policy formulating.

Name Position 1. Mr. Phairat Senachak Director 2. Mr. Thongchai Piyasantiwong Director 3. Ms. Rassamee Metavikul Director 4. Mr. Pratomporn Nakata Director 5. Mr. Krittapas Pongpatarawat Director

Real Service Co.,Ltd. eal Service Co., Ltd. address is at 100/9 Soi Ta-it , Rattanatibet Rd., Nonthaburi . Established in 1995 to provide the construction and maintenance services for the company’s projects. After main contractors completed their jobs, it mainly gave finishing touches before the transfer of the completed units to clients. Real Service acted as the sub-contractor of the projects’ contractors, allowing the contractors to complete their obligations in a faster manner. This also allowed the company to realize revenue from the projects faster. The affiliate’s registered capital was Bt40 million with 400,000 shares at Bt10 apiece. The company owned 19% in the affiliate which has discontinued the operations. Real Service is now discontinued. Its shareholders were:

ANNUAL REPORT 2010 PROPERTY PERFECT 13 Shareholder Shareholder No. of shares % of shares 1. Property Perfect Plc. 76,000 19.00 2. Mr. Chainoi Bhongmakapat 76,000 19.00 3. Mr. Kit Bhongmakapat 76,000 19.00 4. Mr. Somkid Chidtrakul 52,000 13.00 5. Mr. Surasak Wacharaphongpricha 40,000 10.00 6. Mr. Pornswat Katechulasriroj 40,000 10.00 7. Mr. Tossaporn Jirakiatdeekul 20,000 5.00 8. Mr. Niwat Inklinpan 20,000 5.00 Total 400,000 100.00

Note : - The person in No.5 as an executive of Property Perfect Public Company Limited on 31 December 2010 - The person in No.6 as an executive of Property Perfect Public Company Limited on 1 January 2011 Real Service had 1 director – Mr. Chainarong Ngernsopha

Total revenue structure from sales by product type

The company’s main revenue derives from sales of land and houses, most of which are single-detached houses. The company’s revenue structure over the past three years were as follows:

Consolidated financial statements 2010 2009 2008 Million Million Million Baht % Baht % Baht % Revenue from sales of land and houses 7,002.7 80.5% 5,073.4 85.3% 5,420.1 71.2% Revenue from sales of condominium units 777.7 8.9% 778.5 13.1% 2,109.5 27.7% Revenue from sales of land held for development 835.5 9.6% - - 8.6 0.1% Other revenues Receivable interest 7.3 0.1% 0.6 - 1.6 - Revenue from deposits 4.3 - 8.5 0.1% 14.5 0.2% Reversal of allowance for loss on diminution in value of projects ------Others 76.4 0.9% 86.8 1.5% 63.3 0.8% Total revenue 8,703.9 100.0% 5,947.8 100.0% 7,617.6 100.0%

During 2008-2010, the company’s consolidated land and house sale revenue accounted for 71.2%, 85.3% and 80.5% of total revenue, respectively. And revenue from condominium sale accounted for 27.7%, 13.1% and 8.9% of total revenue, respectively and in 2010, the company’s revenue from selling land accounted for 9.6% of total. Under the equity method, the company also reaped affiliates’ contributions of Bt8million, Bt3 million and Bt58 million,In 2008-2010, respectively.

14 PROPERTY PERFECT ANNUAL REPORT 2010 House and condominium sale revenue from various projects are as follows; Land and Houses Sales Revenue Structure by Product Type Product 2010 2009 2008 Project Type MB % MB % MB % Brand “Perfect Masterpiece” Maneeya Masterpiece Exclusive Zone SDH - - 12 - - - Perfect Masterpiece Ekamai-RamIndra SDH 284 4% 169 3% 412 8% Perfect Masterpiece Rattanathibet SDH 320 4% 202 4% 407 7% Perfect Masterpiece Ramkhamhaeng - Suvarnabhumi SDH 84 1% 52 1% - - Perfect Masterpiece Rama IX SDH 928 14% 455 9% - - Perfect Masterpiece Rangsit SDH 12 - - - - - Perfect Masterpiece Sukhumvit 77- Suvarnabhumi ** SDH 66 1% 160 3% - - Brand “Perfect Place” Perfect Place Rattanathibet SDH/Land 58 1% - - - - Perfect Place1 Rattanathibet SDH 163 2% 423 8% 504 9% Perfect Place Ramkhamhaeng- Suvarnabhumi (The Lakeside Home) SDH - - - - 9 - Perfect Place Ramkhamhaeng-Suvarnabhumi (Colonial Zone) SDH - - - - 224 4% Perfect Place Ramkhamhaeng-Suvarnabhumi (The Private Zone) SDH 94 1% 301 6% 612 11% Perfect Place RamaV - Rachapreuk SDH - - 57 1% 486 9% Perfect Place2 Rattanathibet SDH 528 7% 17 - - - Perfect Place Rachapreuk SDH 493 7% 279 6% - - Perfect Place Ramkhamhaeng-Suvarnabhumi (The Lake Zone) SDH 338 5% 166 3% - - Perfect Place2 Ramkhamhaeng-Suvarnabhumi SDH 139 2% - - - - Perfect Place Sukhumvit 77-Suvarnabhumi ** SDH 503 7% 483 10% 638 12% Brand “Maneerin” and Brand “Perfect Park” Maneerin Lake & Park Rachapreuk -Tiwanon SDH/Land 231 3% 212 4% 300 6% Maneerin Exclusive Rangsit SDH - - - - 4 - Maneerin Park Rangsit SDH - - - - 6 - Maneerin Park Rattanathibet SDH - - - - 10 - Maneerin Park 2 Rangsit SDH - - 11 - 145 3% Perfect Park Ramkhamhaeng-Suvarnabhumi SDH - - 8 - 146 3% Perfect Park Rama V- Bangyai SDH 663 10% 599 12% 684 13% Perfect Park Suvarnabhumi ** SDH 285 4% 363 7% 67 1% Brand “The Villa” and “The Mero” The Villa Rattanathibet TH 595 9% 477 10% 590 11% The Metro RamaIX TH 438 6% 512 10% 173 3% The Metro Sathorn TH 480 7% 110 3% 173 3% The Villa Ramkhamhaeng-Suvarnabhumi ** TH 202 3% - - - - The Villa Ram-Indra - Outer ring** TH 60 1% - - - - The Villa Bangbauthong*** TH 38 1% - - - - Other Maneeya 4 SDH - - 5 - - - Nantana Garden Rangsit TH - - - - 3 - Changwattana Land 1 - Total Revenue from the Sale of land and houses 7,003 100% 5,073 100% 5,420 100% Remark : SDH = Single Detached House, TH = Townhouse, Land = Land ** Developed by 100%-owned subsidiary Estate Perfect Co., Ltd . *** Developed by 100%-owned subsidies Residence Number Nine Co., Ltd.

ANNUAL REPORT 2010 PROPERTY PERFECT 15 As shown in the balance sheet, sales revenue of Property Perfect in 2008-2010 are Bt4,715million, Bt4,067million and Bt5,849 million. In the same period, subsidiaries' revenue is Bt705million , Bt1,065million and Bt 1,154million, respectively.

Sales of Condominium Units Revenue Structure by Product type 2010 2009 2008 Project Product Type MB % MB % MB % Brand ‘Metro Park” Metro Park Sathorn CONDO 778 100% 779 100% 2,109 100% Total Revenue from the Sale 778 100% 779 100% 2,109 100% off Condominium Units

Revenue from sales of condominium units presented in the consolidated financial statements came from total revenue from projects developed by Property Perfect Public Company Limited with the amount of Bt2,109million in 2008 ,Bt779 million in 2009 and Bt778 million in 2010. Major changes and developments during 2008-2010

2008 : At the 1/2008 Annual General Meeting of Shareholders on 30 April 2008, resolutions were as follows : • The issuance of all types of debentures (secured or unsecured) worth up to Bt2,000 million, with no more than 5 years of maturity, for the offering to the general public and/or institutional investors and/or investors under a partial or whole private placement in domestic and/or foreign markets. • On 21 January 2008, the company set up Property Perfect Fund (Fund) at the value of Bt520 million. The fund invests in 64 units of two-story houses and enjoys minimum revenue guarantee for 5 years. The company raised its stake in the fund from 5.73% to 6.24% (as of 31 December 2008).

16 PROPERTY PERFECT ANNUAL REPORT 2010 Resolutions of shareholders at the 1/2008, shareholder meeting on 20 June 2008: • Abolish the offering of remaining convertible debentures worth US$15 million, which were endorsed at the 1/2005 extraordinary shareholder meeting on 19 September 2005. • Cancel the issuance of 39,000,000 shares, reserved for the warrants under ESOP. • Reduce the registered capital from Bt6,213.56 million to Bt5,589.56 million or 931.59 million shares at Bt6 par value. • Endorse convertible debentures worth no more than US$30 million or no more than Bt1,000 million in Thai baht. The debentures, with no more than 5 years of maturity, were to be offered to local or foreign institutional investors. • Increase the registered capital from Bt5,589.56 million to Bt6,552.00 million, by the issuance of 160.40 million shares at Bt6 par value, to accommodate the exercise of warrants approved at an extraordinary meeting. • 2009 : Resolutions of shareholders at the 1/2009, shareholder meeting on 30 April 2009 • Allocate partial profit worth Bt40 million as legal reserve and approve dividend of Bt0.36 per share or a total of Bt283,579,783.20. Shareholders eligible to receive the dividend were specified under the Securities and Exchange Act BE2535's Article 225 on 14 May 2009. Shareholder registration for the dividend payment closed on 15 May 2009. Dividend was paid within 30 May 2009. • Approve no more than Bt15 million in bonus payment to directors for the performance in year 2008. Chairman was tasked to allocate the amount. • Approved • Reappoint Mr. Vidhya Nativivat, Miss Sirirat Wongwattan and Mr. Ooi Boon Aun, who completed their terms, as directors for another term. • Reappoint Mr. Somsak Toraksa who ended his term as a director, an independent director, and a member of the Audito Committee. He will serve a 3-year term from the appointment date at the 2009 shareholder meeting. • Approve meeting allowances of no more than Bt7.5 million to directors for the year 2009. • Appoint the auditor of Ernst & Young Co.,Ltd for the 2009 audit. The auditor could be Mr. Narong Pantawong, certified public accountant No.3315; and/or Miss Thipawan Nananuwat, certified public accountant No.3459; and/or Miss Siraporn Ouaanunkun, certified public accountant No. 3844. The auditor fee is set at no more than Bt1.65 million.

Board's resolutions at the 5/2009 meeting on 14 August 2009 • Approve the issuance of Bill of Exchange to institutional investors, high-net worth investors or the general public, at the value of no more than Bt1,000 million. The BE with maturity of no more than 1 year quoted the market interest rate at the issue date. Proceeds were used to increase the company's working capital.

Board's resolutions at the 6/2009 meeting on 12 November 2009 • Approve the issuance of Bill of Exchange to institutional investors, high-net worth investors or the general public, at the value of no more than Bt1,000 million. The BE with maturity of no more than 1 year quoted the market interest rate at the issue date. Proceeds were used to increase the company's working capital.

ANNUAL REPORT 2010 PROPERTY PERFECT 17 Board’s resolutions at the 6/2009 meeting on 12 November 2009 • Approve the investment in Bright Development Bangkok Company Limited (subsidiary)’s common shares worth Bt499 million, consisting of 4,990,100 shares at Bt100 par value, to maintain the company’s stake in the subsidiary.

2010 : Board's resolutions at the 1/2010 meeting on 22 January 2010 • Approve the investment in 20 million new shares at Bt10 apieceor a total of Bt200 Million of Estate Perfect Company Limited, to maintain the shareholding ratio in Estate Perfect. Estate Perfect was instructed to use the Bt200 million proceeds in paying debts (debt conversion) to the company. • Cancel joint investment with Timberline Investments Pte. Ltd, in Centrepoint Shopping Mall Company Limited (a subsidiary), by taking over 4,000 shares at Bt100 apiece or a total of Bt400,000 from Timberline Investments. Combined with 5,999 shares, the new shares increased the company’s shares in Centrepoint to 9,998 shares or 99.99% of registered capital. • Approve the investment in 4.99 million shares at Bt100 apiece or a total of Bt499 million in Centrepoint Shopping Mall Company Limited. Fifty per cent of the new shares or Bt249.5 million were paid-up. • Approve the takeover of Residence Number Nine Company Limited, capitalized at Bt1,0000 million, at the cost of Bt504 million.

Board's resolutions at the 2/2010 meeting on 26 February 2010 • Cancel the issuance of remaining debentures worth Bt80 million, approved by the 1/2008 shareholders meeting on 30 April 2008.

Shareholders’ resolutions at the 1/2010 meeting on 30 April 2010 • Approve the allocation of Bt20 million from net profits as legal reserves and approve the dividend payment of Bt0.25 per share or a total of Bt196,931,030 to shareholders whose names were specified on 17 May 2010 (record date) as well as shareholders appearing on the registration book on 18 May 2010, accordingly to the Securities and Exchange Act BE 2535’s Article 225. The dividend was payable within 27 May 2010. • Approve bonus for the 2009 operating year to the Board at the value of no more than Bt7.5 million. • Approved • Reinstate Mr. Phairat Senachak and Mr. David Bryce van Hoppen, whose director terms ended, as directors for another term. • Reinstate Mr.Veerayuk Panpet and Mrs. Nuanual Swasdikula Na Ayudhaya whose director terms ended as directors and independent directors with a 3-year term from the day they were appointed by the 2010 shareholders meeting. • Reinstate Mr. Krish Follett as an additional director and independent director. • Approve the meeting allowances for the Board for the 2009 operating year at no more than Bt7.5 million. • Approve the appointment of Ernst & Young Company Limited’s Miss Thipawan Nananuwat, Certified Public Accountant (Thailand) No. 3459, and/or Mr.Krisada Lertvanna, Certified Public Account Thailand. Certified No.4958, and/or Miss Siraporn Ouaanunkun, Certified Public Accountant's License No. 3844, as the company’s auditor for 2010 and set the auditing fee at no more than Bt1.7 million.

18 PROPERTY PERFECT ANNUAL REPORT 2010 • Approve the issuance of all types of debentures (secured or unsecured) worth no more than Bt4,000 million and/or in other currencies at the equivalent value. The bond maturity must not exceed 5 years, from the issuance date. (See Note to Financial Statements No. 21 Debentures).

Board's resolutions at the 3/2010 meeting on 10 May 2010 • Approve the additional amount of bill of exchange, after the redemption of short-term B/E. Outstanding value of short-term B/E at any point must not exceed Bt2,000 million. • Approve the guarantee to Bright Development Bangkok Company Limited (subsidiary)’s project financing from a financial institution, valued at Bt870 million. • Approve the agreement to strike a guarantee on bank loans to Estate Perfect Company Limited (subsidiary)’s 3 development projects worth totally Bt1,235 million and the Bt200 million letter of guarantee for infrastructure and project maintenance. Property Perfect Public Company Limited, as a major shareholder, will jointly shoulder the debt.

Board's resolutions at the 4/2010 meeting on 10 August 2010 • Approve the early redemption of Property Perfect Public Company Limited’s secured debentures #1/2009, due 2012. The company is allowed to pay no more than Bt1,050 per unit for the redemption. • Approve a Bt500 million loan to Bright Bangkok Company Limited (subsidiary), which would use the amount to buy land and increase working capital. Bright issued promissory notes to the company in return, offering the interest rate equivalent to the company’s average financial cost plus 0.65 percentage point per annum. • Approve a Bt100 million working-capital loan to Residence Number Nine Company Limited (subsidiary), which in return issued promissory notes to the company, offering the interest rate equivalent to the company’s average financial cost plus 0.65 percentage point per annum.

ANNUAL REPORT 2010 PROPERTY PERFECT 19 Shareholder Structure and Management

1. Shareholder Major shareholders

(a) The first 10 largest shareholders as of 31 December 2011 are; Rank Name No. of shares % 1 Thailand NVDR Co., Ltd. 108,818,126 13.81 2 Japan Asia Group Co., Ltd. (1) 97,244,168 12.34 3 Miss Sumonmas Lipisuntorn 56,569,089 7.18 4 MJL Intertrade Co., Ltd. (2) 45,910,827 5.83 5 Natee International Law Office Co.,Ltd. (3) 37,018,928 4.70 6 Andaman Long Beach Resort Co., Ltd. (4) 36,778,700 4.67 7 Finansa Life Assurance Co., Ltd. 17,345,000 2.20 8 Mrs.Seeda Wataphab 17,000,000 2.16 9 Mr.Mahintr Pratchayanant 15,016,900 1.91 10 Miss Sumalee Wangprakobsuk 14,667,255 1.86 Data from Thailand Securities Depository Co., Ltd.

20 PROPERTY PERFECT ANNUAL REPORT 2010 ANNUAL REPORT 2010 PROPERTY PERFECT 21 22 PROPERTY PERFECT ANNUAL REPORT 2010 1 The Board of Directors As of December 31, 2010, the board consists of 12 directors as follow::

No. Name Title 1 Dr. Tawatchai Nakhata Chairman 2 Mr.Veerayuk Panpet Deputy Chairman and Independent Director 3 Mr. Chainid Ngow-Sirimanee Director and Chief Executive Officer 4 Mr. Phairat Senachack Director 5 Mr. Vidhya Nativivat Director 6 Mr. David Bryce Van Oppen Director 7 Ms. Sirirat Wongwattana Director 8 Mr. Ooi Boon Aun Director 9 Dr. Somsak Toruksa Director / Independent Director and Audit Committee 10 Dr. Thamnoon Ananthothai Director / Independent Director and Audit Committee 9 Mrs.Nuanual Swasdikula-Na- Director / Independent Director AyudAyudhaya 10 Mr.Krish Follett* Director / Independent Director and Chairman of Auditing Committee With Mr. Pramote Rermyindee as secretary of the board

Note : * Mr.Krish Follett Appointed in accordance with a resolution of the company’s Board of Directors 1/2010 on 30 April 2010. . Authorised directors Authorized signatory directors are 1) Dr.Tawatchai Nakhata and Mr. Chainid Ngow-Sirimanee are duly authorized to sign documents and affix the company’s seal. 2) Any one of the following directors - Dr.Tawatchai Nakhata or Mr. Chainid Ngow-Sirimanee - is au- thorized to co-sign documents with one the these directors - Mr. Phairat Senachack or Miss Sirirat Wongwattana – and affix the company’s seal. 3) Dr. Tawatchai Nakhata, or Mr. Chainid Ngow-Sirimanee, or Mr. Phairat Senachack, or Ms. Sirirat Wongwattana can sign and affix the company’s seal on the matters involving; 1. Commerce Ministry and related units 2. Revenue Department and related units 3. Lands Department and related units 4. Department of Public Works and Town & Country Planning and related units 5. Bangkok Metropolitan Administration, Pattaya City and related units 6. Municipality, provincial administrative organizations and tambon administration organizations 7. Government units, state enterprises and private organizations dealing with waterworks, elec- tricity, telephone, postal and Internet services. A director must sign and affix the company’s seal on the matters. The shareholders meeting or the Board can identify the directors with the authority to sign and affix the company’s seal.

ANNUAL REPORT 2010 PROPERTY PERFECT 23 Board of Directors’ authority and scope of responsibility The Board of Directors is authorized to make decisions and ensure that the company’s operations follow the objectives, regulations, shareholders’ resolutions and legal conditions. Its authority does not cover the decisions which must be approved by shareholders as prescribed by the Securities and Exchange Commission and the Stock Exchange of Thailand. Under the company’s regulations, the Board of Directors is authorized to appoint the executive board which will monitor the daily operations of the company under the guidelines and budget approved by the Board of Directors and handle other tasks bestowed by the Board of Directors. The executive board can approve the decisions within its power granted by the Board of Directors or have to propose the issues beyond its power for the Board of Directors’ consideration. The regulations also empower the Board of Directors to appoint other officers or other working committees to assist the executive board.

2. Audit Committee As of 31 December 2010, the Audit Committee consists of 3 independent directors.

No. Name Title 1 Mr. Krish Follett Chairman of the Audit Committee 2 Dr. Somsak Toruksa Auditing Committee 3 Dr. Thamnoon Ananthothai* Auditing Committee With Ms. Doungporn Rermyindee as the secretary

Note: * Possessing expertise in accounting (See biography of directors, executives and authorized individuals) Audit Committee’s authority and scope of responsibility 1. Supervise the company’s operations to ensure honesty, transparency, and responsibility to shareholders. 2. Ensure that the executive board and executives handle their responsibilities in an accurate, complete and standard manner.

24 PROPERTY PERFECT ANNUAL REPORT 2010 ANNUAL REPORT 2010 PROPERTY PERFECT 25 3. The Director Nominating Committee The Director Nominating Committee consisted of 3 persons as of 31 December 2010.

No Name Position 1 Dr. Somsak Toruksa Chairman of the Nominating committee 2 Mrs. Nuanual Swasdikula-Na-Ayudhaya Nominating committee 3 Mr. Vidhya Nativivat Nominating committee With Mr. Pramote Rermyindee as secretary Nomination Committee's scope of authority and responsibility 1. Review the individuals who are fit to be the company's directors and nominate the list to the board of directors and/or present the list to shareholders for official appointment. 2. In reviewing the individuals' qualifications, the committee must consider their expertise, knowledge, ability and relevant experiences to ensure that the individuals' qualifications would be useful for the company's operations. Besides, the committee must consider that the nominations follow the legal framework particularly when it involves the nominations for independent directors and the audit committee members. 3. In selecting independent directors and the audit committee members, the committee must take into account; (A) The nominated individuals must hold no more than 5% of the paid-up capital of the company, affiliates or subsidiaries. The percentage is inclusive of the shareholding of related individuals - their spouses and underage children. (B) The nominated persons must not be related to the company's executives or major shareholders. (C) The appointed persons must not have conflicts of interest, directly or indirectly, in terms of finances or management of the company and affiliates. They must not be the company's major shareholders. (D) The nominated persons must have no any relationship with the company and associates in ways of vested interest, or financial or management benefit at present and over the past two years before appointed as independent directors. Such relations include • Being directors who take part in the company's management, employees, staff members, advisers who receives a regular salary, or control authorities. • Being professional service providers such as auditors, legal Consultants, financial advisors or price appraisers. • Having business relationship such as buy/sell goods, provide asset buy or sell service, give or receive financial assistance etc. (E) In case that the nominated persons serve as independent directors of other companies in the group, they must disclose such information and remuneration received from those companies. (F) The nominated persons must not seat as any director in other listed companies in the group. 4. The appointed persons must be able to work and present their views with independence, free from the control from executives or major shareholders as well as their relatives.

Director Selection Committee’s authority, duty and responsibility could not be transferred to others in a way that those who are authorized by the committee can approve transactions that might lead

26 PROPERTY PERFECT ANNUAL REPORT 2010 to conflicts of interest (as defined in the Securities and Exchange Commission's announcement) with the company or subsidiaries, or he/she has vested interest with exception that those transactions are regarded as normal course of business with the clear scope.

To present the selected persons to the board of directors, the Selection Committee must nominate only those who will fill the available director seats. Except when the committee members could not reach an agreement, they are allowed to present all the nominated names to the board for their consideration.

4. The Remuneration and Human Resources Committee The Remuneration and Human Resources Committee consisted of 3 persons as of 31 December 2010. No. Name Position 1 Mr. Virayuk Puntupetch Chairman of the remuneration committee 2 Mr. Krish Follett The remuneration committee 3 Mr. Vidhya Nativivat The remuneration committee With Mr. Pramote Rermyindee as secretary.

The Remuneration and Human Resources Committee's scope of authority and responsibility 1. Consider the company's policies and criteria in paying the Chief Operation Officer, directors, and the company's advisors. 2. Consider the annual salary, annual pay increase, and the interim pay increase, as well as other benefits to award all employees. 3. Consider the employment terms, regulations, and penal clauses which should be appropriate and fair. 4. The committee will report directly to the board of directors, to whom they will explain and answer all questions regarding the pays for employees at all levels.

Remuneration and Human Resources Committee’s authority, duty and responsibility could not be transferred to others in a way that those who are authorized by the committee can approve transactions that might lead to conflicts of interest (as defined in the Securities and Exchange Commission's announcement) with the company or subsidiaries, or he/she has vested interest with exception that those transactions are regarded as normal course of business with the clear scope.

5. Risk Management Committee Risk Management Committee consisted of 4 persons as of 31 December 2010. No. Name Position 1 Mrs. Nuanual Swasdikula-Na-Ayudhaya Chairman of Risk Management committee 2 Mr. Boonliam Luangnakthongdee Risk Management committee 3 Dr.Thamnoon Ananthothai Risk Management committee 4 Mr.Chirdsak Kukiattinun Risk Management committee With Dr. Theerathorn Tharachai as secretary

ANNUAL REPORT 2010 PROPERTY PERFECT 27 Risk Management Committee's scope of authority and responsibility 1. Review and present risk management policy and acceptable risk to the company’s board for approval. 2. Supervise development and practice throughout organization to comply with risk management framework. 3. Review risk management reports to monitor important risks and proceed to ensure that the organization has sufficient and appropriate risk management. 4. Present risk of the company in overall picture, and sufficiency of internal control system to manage risk in all important aspects to the company's board. 5. Provide suggestion about risk management to the company and revise any information concerning risk management system development. 6. Authorizes to appoint the company's risk evaluation and monitoring working group. 7. Perform other tasks about risk management assigned by the company’s board

6. Executive Board Executive Board contains 11 individuals, as of 31 December 2010. No. Name Position 1 Dr.Tawatchai Nakhata Chief Executive Director (Authorized signatory Directors) 2 Mr.Chainid Ngow-Sirimanee Deputy Chief Executive Director (Authorized signatory Directors) 3 Mr.Phairat Senachack Executive Director (Authorized signatory Directors) 4 Mr.Vichai Singvicha Executive Director 5 Ms.Supee Reodacha Executive Director 6 Mr.Surasak Vacharapongpreecha Executive Director 7 Mr.Wicharn Siriwetwarawut Executive Director 8 Mr.Pornswat Katechulasriroj Executive Director 9 Mr.Wongsakorn Prasitvipat Executive Director 10 Mr.Tongchai Peyasantiwong Executive Director 11 Ms. Sirirat Wongwattana Executive Director and Secretary (Authorized signatory Directors)

Executive Committee’s authority and scope of responsibility* 1. Run the company's daily operations under the guidelines set by the Board of Directors and within the scope of rules and regulations, as well as the company's objectives and regulations. They are barred from transactions related to project opening and investment, not related to the company’s core business. 2. Appoint high-ranking executives to manage the company. 3. Set the annual budget for the Board of Directors' approval. 4. Consider investment projects for the Board of Directors' approval. 5. Review and approve land acquisition worth over Bt200 million but not more than Bt800 million. The amount must not exceed the sum approved by the Board. Any approved land purchase must be attached with the preliminary development plan and project feasibility, for the Board’s consideration.

28 PROPERTY PERFECT ANNUAL REPORT 2010 ANNUAL REPORT 2010 PROPERTY PERFECT 29 7. Chief Executive Officer* Chief Executive Officer is the highest authority in the company’s management. perform duties and report operating performance to the Executive Committee, Board of Directors and shareholders as follows : 1. Set policies, direction, and strategies for the company’s business operation. 2. Set business planning, budget and authority of the company’s internal units which up to management department to seek the board’s approval. 3. Manage normal course of business activities under policies set by the company’s board, laws, conditions, regulations, memorandum of association, and the company’s rules. 4. Appointed Management Board, advisor and other directors to give advices concerning the company's management. 5. Review and approve land acquisition worth no more than Bt500 million. The purchase must be notified to the Executive Committee, to proceed with the registration at the Lands Department. 6. Perform other tasks assigned by the company’s board.

Chief Executive Officer authority, duty and responsibility could not be transferred to others in a way that those who are authorized by Chief Executive Officer can approve transactions that might lead to conflicts of interest (as defined in the Securities and Exchange Commission’s announcement) with the company or the subsidiaries and affiliates, or he/she has vested interest with exception that those transactions are regarded as normal course of business as policies and principles set by the company’s board. In compliance with laws governing securities and stock exchange, regulations, announcements, instructions or rules of the Stock Exchange of Thailand. Note: * Revised by Board's resolutions at the 1/2010 meeting on 22 January 2010. 8. Executives The company’s executive team consisted of 11 members as of 31 December 2010. No. Name Position 1 Mr. Chainid Ngow-Sirimanee Chief executive officer and acting Chief Finance Officer and acting Chief Operating Officer 2 Mr.Vichai Singvicha Chief Business Development Officer 3 Mr.Pramote Rermyindee Company Secretary (equivalent to Chief Officer) * - Deputy Chief Finance Officer * - Deputy Chief business development Officer 4 Mrs.Wanida Waiyawatmai Deputy Chief Operating Officer 5 Mr.Phairat Senachak Deputy Chief Operating Officer 6 Ms.Supee Reodecha Assistant Chief Finance Officer 7 Ms.Sirirat Wongwatana Assistant Chief Business Development Officer 8 Mr. Wongsakorn Prasitvipat Assistant Chief Operating Officer 9 Mr.Wicharn Siriwetwarawut Assistant Chief Operating Officer 10 Mr.Surasak Vacharapongpreecha Assistant Chief Finance Officer 11 Mr.Tongchai Peyasantiwong Assistant Chief Operating Officer * Vacant positions

30 PROPERTY PERFECT ANNUAL REPORT 2010 The company’s executive team consisted of 6 members as of 1 January 2011. No. Name Position 1 Mr.Chainid Ngow-Sirimanee Chief executive officer 2 Ms.Supee Reodacha Deputy Chief Financial Officer 3 Ms.Sirirat Wongwatana Deputy Chief Supporting Officer 4 Mr.Wongsakorn Prasitvipat Deputy Chief Business Development Officer 5 Mr.Wicharn Siriwetwarawut Deputy Chief Operating Officer1 6 Mr.Pornswat Katechulasriroj Deputy Chief Operating Officer2

ANNUAL REPORT 2010 PROPERTY PERFECT 31 Meeting allowances of the company’s board and 5 units of subcommittees in 2009-2010 . Risk Board of Audit Remuneration Selection Management Directors Committee Committee Committee Committee Name 2010 2009 2010 2009 2010 2009 2010 2009 2010 2009 Dr.Tawatchai Nakhata 5 6 1 Dr. Somsak Toruksa* 5 6 7 8 1 Dr. Thamnoon Ananthothai * 5 6 7 8 1 1 8 4 Mr.Chainid Ngow-Sirimanee 5 6 Mr.Phairat Senachak 5 6 Mr.Vidhya Nativivat * 5 6 1 1 Mr.Virayuk Puntupetch *,**** 5 6 7 8 Ms.Sirirat Wongwattana 5 6 Mr.David Bryce Van Oppen 4 6 Mr.Ooi Boon Aun 5 6 Mrs.Nuanual Swasdikula-Na- 5 6 8 4 Ayudhaya * Mr.Krish Follett*, *** 3 5 Mr.Prmote Rermyindee 5 Ms. Supee Reodacha ** 5 Mr.Surasak Vacharapongpreecha ** 5 Mr.Boonliam Luangnakthongdee 8 6 Mr.Chirdsak Kukiattinun 8 4 Dr. Theerthorn Tharachai 8 9 Total 5 6 7 8 - 1 - 1 8 9 Note: * Independent Directors ** Term as member of the Risk Management Committee ended upon the establishment of the new committee on 14 May 2009 . *** Mr. Krish Follett took position on 30 April 2010 **** Mr.Veerayuk Panpet resigned from the Audit Committee, upon the establishment of the new Audit Committee on 1 May 2010 Company’s secretary The Securities and Exchange Act (the fourth issue)’s article 89/15 on 2008 prescribed that the company’s board must appoint the company’s secretary to act on behalf of the company or the company’s board. Meeting of the company’s board on 11 August 2008 approved to appoint Mr. Pramote Reumyindee as the secretary.

Secretary’s scope of authority and responsibility 1) Prepare and collect documents as follows a) Director registration b) Board meeting notice, minutes of board meeting and the company’s annual report. c) Shareholders’ meeting notice and minutes of shareholders’ meeting.

32 PROPERTY PERFECT ANNUAL REPORT 2010 ANNUAL REPORT 2010 PROPERTY PERFECT 33 34 PROPERTY PERFECT ANNUAL REPORT 2010 ANNUAL REPORT 2010 PROPERTY PERFECT 35 คณะกรรมการบริษัท

1 Dr. Tawatchai Nakhata 2 Mr.Chainid Ngow-Sirimanee 3 Mr.Virayuk Puntupetch Chairman Directors Deputy Chairman Chief Executive Director Chief Executive Officer Independent Director Deputy Chief Executive Director Chairman of the Audit Committee

4 Dr. Somsak Toruksa 5 Mr. Vidhya Nativivat 6 Dr. Thamnoon Ananthothai Director Non Executive Director Director Independent Director Nominating Committee Independent Director Audit Committee Remuneration Committee Audit Committee Chairman of the Nominating Risk Management Committee Committee

36 PROPERTY PERFECT ANNUAL REPORT 2010 7 Mr. David Bryce Van Oppen 8 Mr.Ooi Bun Aun 9 Mrs.Nuanual Swasdikula- Na-Ayudhaya Non Executive Director Non Executive Director Director Independent Director Chairman of Risk Management Committee Nominating Committee

10 Mr.Krish Follett 11 Mr. Phairat Senachack 12 Ms. Sirirat Wongwattana Director Director Director Independent Director Executive Director Executive Director Chairman of Audit Committee Advisors to the Chief Deputy Chief Remuneration Committee Executive Officer Supporting Officer

Mr. Pramote Rermyindee Company Secretary

ANNUAL REPORT 2010 PROPERTY PERFECT 37 Organization Chart

Property Perfect Public Company Limited

Chief Advisor to the Board of Directors Board Of Directors Nominating Committee

Risk Management Committee Executive Director

Audit Committee Chief Executive Offfiicer (CEO)

Internal Audit Offiffiice Advisors to the Chief Executive Offiffiicer

Chief Operating Offiffiicer 1 Chief Operating Offiffiicer 2 Chief Business Development Offiffiicer (COO 1) (COO 2) (CBO)

Deputy Chief Operating Offiffiicer 1 Deputy Chief Operating Offiffiicer 2 Deputy Chief Business Development (Dep.-COO1) (Dep.-COO2) Offiffiicer (Dep.-CBO)

Assistant Chief Operating Offiffiicer 1 Assistant Chief Operating Offiffiicer 2 Assistant Chief Business Development (Asst.-COO1) (Asst.-COO2) Offiffiicer (Asst.-CBO)

Project Management Division The villa Project Management Zone I Division Project Planning Division Project Management Division I Condo Project Management Design Division Zone II Division Project Management Division Uniloft Project Management Zone III Division Advertising Division Project Management Division Planning and Development Public Relations and Corporate Zone IV Division - I Condo and Uniloft Communication Division Projects Project Management Division Zone V Construction Management Sales Management Division Division - The Villa Project Construction Management Division Construction Management Division- I Condo , Uniloft Legal Procedure & Ownership Transfer Division

38 PROPERTY PERFECT ANNUAL REPORT 2010 Remuneration Committee

Company Secretary

Legal Offiffiice

Offiffifiifice of the Chief Executive Offiffifiificer Research & Business Development Division Product Development & Quality Control Division

Chief Financial Offiffiicer Chief Supporting Offiffiicer (CFO) (CSO)

Deputy Chief Financial Offiffiicer Deputy Chief Supporting Offiffiicer (Dep.-CFO) (Dep.-CSO)

Assistant Chief Financial Offiffiicer Assistant Chief Supporting Offiffiicer (Asst.-CFO) (Asst.-CSO)

Investor Relation & Information Finance & Treasury Division System Division Fund Management and Accounting Division Debenture Division Budgeting Division General Administration Division

Human Resources Division

ANNUAL REPORT 2010 PROPERTY PERFECT 39 Project Information

Project of Property Perfect Plc. and Subsidiary on 31 December 2010.

1. Perfect Masterpiece Ekamai-Ram-indra Time to Develop 2004-2011 Product SDH Total Units 230 Total project Value 3,419MB. Remaining Units 11 Remaining Project Value 144 MB. 2. Perfect Masterpiece Rattanatibet Phase 1-2 Time to Develop 2007-2011 Product SDH Total Units 146 Total project Value 1,477 MB. Remaining Units 38 Remaining Project Value 380 MB. 3. Perfect Masterpiece Rama IX Time to Develop 2008-2014 Product SDH Total Units 283 Total project Value 3,441 MB. Remaining Units 165 Remaining Project Value 1,980 MB. 4. Perfect Masterpiece Ratchapruek Time to Develop 2010-2011 Product SDH Total Units 51 Total project Value 512 MB. Remaining Units 50 Remaining Project Value 500 MB. 5. Perfect Place Rattanatibet Time to Develop 2005-2011 Product SDH Total Units 396 Total project Value 1,699 MB. Remaining Units 12 Remaining Project Value 56 MB.

40 PROPERTY PERFECT ANNUAL REPORT 2010 6. Perfect Place Rattanatibet Phase 2 Time to Develop 2009-2012 Product SDH Total Units 357 Total project Value 1,702 MB. Remaining Units 237 Remaining Project Value 1,133 MB. 7. Perfect Place Ramkhamhaeng- Suvarnabhumi Private Zone Time to Develop 2005-2010 Product SDH Total Units 302 Total project Value 1,732 MB. Remaining Units 5 Remaining Project Value 27 MB. Masterpiece Zone Time to Develop 2008-2010 Product SDH Total Units 6 Total project Value 150 MB. Remaining Units 1 Remaining Project Value 15 MB. Lake Zone Time to Develop 2009-2011 Product SDH Total Units 83 Total project Value 745 MB. Remaining Units 25 Remaining Project Value 180 MB. Private Zone Phase 2 Time to Develop 2010-2012 Product SDH Total Units 288 Total project Value 1,512 MB. Remaining Units 261 Remaining Project Value 1,357 MB.

ANNUAL REPORT 2010 PROPERTY PERFECT 41 8. Perfect Place Sukhumvit77-Suvarnabhumi Phas 1-4* Time to Develop 2004-2013 Product SDH Total Units 1,055 Total project Value 5,960 MB. Remaining Units 353 Remaining Project Value 1,875 MB. 9. Perfect place Ratchapruek Phase1 Time to Develop 2009-2012 Product SDH Total Units 396 Total project Value 2,015 MB. Remaining Units 232 Remaining Project Value 1,186 MB.

10. Maneerin Lake&Park Ratchapruek-Tiwanon Time to Develop 2003-2011 Product SDH Total Units 702 Total project Value 3,093 MB. Remaining Units 96 Remaining Project Value 451 MB.

11. Perfect Park RamaV-Bangyai Phase1-4 Time to Develop 2006-2011 Product SDH,DH Total Units 1,198 Total project Value 3,844 MB. Remaining Units 427 Remaining Project Value 1,409 MB.

12. Perfect Park Suvarnabhumi Phase1 * Time to Develop 2007-2011 Product SDH Total Units 194 Total project Value 777 MB. Remaining Units 14 Remaining Project Value 55 MB.

42 PROPERTY PERFECT ANNUAL REPORT 2010 13. Perfect Park Suvarnabhumi Phase2 * Time to Develop 2010-2013 Product SDH Total Units 309 Total project Value 1,251 MB. Remaining Units 296 Remaining Project Value 1,191 MB.

14. Perfect Park Rangsit Time to Develop 2010-2012 Product SDH Total Units 148 Total project Value 536 MB. Remaining Units 142 Remaining Project Value 511 MB.

15. Perfect Park Bangbuathong** Time to Develop 2010-2013 Product SDH Total Units 403 Total project Value 1,511 MB. Remaining Units 379 Remaining Project Value 1,421 MB. 16. The Villa Rattanatibet. Time to Develop 2006-2012 Product TH,DH Total Units 1,427 Total project Value 3,564 MB. Remaining Units 453 Remaining Project Value 1,450 MB. 17. The Villa Ramkhamhaeng-Suvarnabhumi * Time to Develop 2010-2012 Product TH Total Units 289 Total project Value 639 MB. Remaining Units 173 Remaining Project Value 384 MB.

ANNUAL REPORT 2010 PROPERTY PERFECT 43 18. The Villa Ram-Intra- Outerring * Time to Develop 2010-2012 Product TH Total Units 295 Total project Value 667 MB. Remaining Units 223 Remaining Project Value 525 MB. 19. The Villa Bangbuathong ** Time to Develop 2010-2012 Product TH Total Units 301 Total project Value 647 MB. Remaining Units 259 Remaining Project Value 557 MB. 20. The Metro Rama IX Time to Develop 2008-2011 Product TH Total Units 491 Total project Value 1,804 MB. Remaining Units 173 Remaining Project Value 606 MB. 21. The Metro Sathorn Time to Develop 2009-2011 Product TH Total Units 216 Total project Value 900 MB. Remaining Units 48 Remaining Project Value 178 MB. 22. Metro Park Sathorn Phase 1-3 Time to Develop 2009-2012 Product CD Total Units 4,625 Total project Value 8,564 MB. Remaining Units 1,560 Remaining Project Value 3,120 MB.

44 PROPERTY PERFECT ANNUAL REPORT 2010 23. Metro Sky Ratchada phase 1*** Time to Develop 2010-2011 Product CD Total Units 441 Total project Value 1,096 MB. Remaining Units 125 Remaining Project Value 312 MB. 24. Metro Sky Sukhumvit Phase1 Time to Develop 2010-2012 Product CD Total Units 588 Total project Value 1,615 MB. Remaining Units 454 Remaining Project Value 1,226 MB. 25. I condo Ngamwongwan*** Time to Develop 2010-2012 Product CD Total Units 480 Total project Value 595 MB. Remaining Units 280 Remaining Project Value 336 MB. 26. I condo Sukapiban 2*** Time to Develop 2010-2012 Product CD Total Units 1,100 Total project Value 1,334 MB. Remaining Units 881 Remaining Project Value 1,057 MB. 27. I condo Sukhumvit105*** Time to Develop 2010-2012 Product CD Total Units 1,600 Total project Value 2,083 MB. Remaining Units 1,425 Remaining Project Value 1,852 MB.

Note: * Subsidiary’s Project ( Estate Perfect Co., Ltd.) ** Subsidiary’s Project ( Residence number Nine Co., Ltd.) *** Subsidiary’s Project (Bright Development Bangkok Co., Ltd.)

ANNUAL REPORT 2010 PROPERTY PERFECT 45 Map

46 PROPERTY PERFECT ANNUAL REPORT 2010 Marketing and Competition

Marketing

Marketing Strategy The company sets marketing strategies in line with competition, taking into consideration location, competition situation, target , SWOT analysis and external factor which effect to product development , the strategy as follow: Product Strategies • Product Design The company applies data from the research and development department in designing to best respond to customer preferences. The company's product design covers single houses and townhouses – with focus on the look and usable space to fit the new lifestyle as well as Thailand’s weather condition. The design team, with over 20 years of experience, also works with leading architecture firms in creating new innovative features – having the design, usable space and cost-efficiency as the priorities.

In 2010, the company introduced V Series design, with space of large-sized houses extended horizontally and vertically for greater comfort. Usable space is doubled, aside from extra-high windows to ensure all-day air ventilation and a door next to the beautiful garden. The modern design is overwhelmingly welcomed. In 2011, the C-series design was launched for Perfect Park and Perfect Place brands to improve the urban lifestyle features.

ANNUAL REPORT 2010 PROPERTY PERFECT 47 • Cool lifestyle: With all-new modern functions for space maximization, to accommodate all favorite activities of start-up families. • Click design: Modern features, interior and exterior • Convenience function: Every corner is designed for family functions and energy efficiency • City location: Various accesses to the city area through expressways, Airport Rail Link, Purple Line electric train and Red Line electric train • Quality The company controls construction works quality, by having contractors complete the designed works with quality materials within the specified period. The construction pattern and methods are jointly formulated to meet the company's standards. Since 2008, the company has applied new construction technology like the prefabrication, and rigid frame or skeleton system with the construction of single houses, duplex houses and townhouses of Perfect Place, Perfect Park ,The Villa and The Metro projects which have been warmly welcomed. In 2010, the company also developed the Site Management system, to put the comprehensive control on all construction steps to ensure complete products before delivery.

The company has embraced the prefabricated technology to cope with business growth, as this technology reduces the construction period from 6-8 months to 4-5 months. Emphasis is maintained on the quality of construction materials, with the supply mainly from Siam Cement Public Company Limited (SCG), to assure customers of durability and beauty. The company and subsidiaries also control construction cost through bulk purchases and are prepared to introduce the supply chain management technique.

In 2010, the company struck a partnership with Siam Cement Public Company Limited (SCG), whereby both jointly introduced a house completed by the innovative Modular system. As a choice to customers, the “SCG HEIM innovative House” is designed to enhance the quality of life through modern technology, high-quality materials and precise quality assessment. The innovative house first prevailed as part of Perfect Masterpiece Rama IV project and has attracted warm welcome. In 2011, the new choice will be expanded to other projects of the company to meet the growing customer demand.

The company and subsidiaries have the policy to sell completely-built housing units, which match the need of customers who want to move in after purchases. They can view the complete units before making a decision. Within 1 month after purchases, the units can be transferred to customers who can immediately move in. The construction works of condominium units will however start after pre-sales.

Condominium The company launched low-rise condominium, namely Metro Park, near the city center and along the electric train route. The project’s price tag is between Bt1.2-Bt3 million per unit. In 2009, high-rise condominium Metro Sky was introduced, to lure home buyers looking for city units near the electric train routes. The units are priced between Bt2-Bt5 million per unit.

In 2010, Bright Development Bangkok Company Limited (subsidiary) launched a condominium project under “i-Condo” brand. The low-rise condominium is designed to principally satisfy customers who seek accommodations in the city area or near the city area with convenient access to electric trains and expressways. The condominium is priced Bt1-Bt2 million.

48 PROPERTY PERFECT ANNUAL REPORT 2010 In 2011, Bright Development Bangkok Company Limited (subsidiary) plans to launch “Uniloft” low-rise condominium near community areas and universities, priced Bt1-Bt1.2 million per unit. Through this brand, the company aims to snatch some market shares in the low-priced condominium segment.

The company and subsidiaries’ condominiums will draw customers mainly with the larger-than-required central area for the comfortable lifestyle. The condominiums will possess the single house project’s ambience, fully equipped with a swimming pool, a fitness center and quality security system.

• Environment Impact Assessment Aside from the houses, the company also emphasises home design and the focus on the environmental management in the projects, security system, and after-sale services to ensure a perfect community for all clients to add value to residents in projects. With the focus, the company won EIA Monitoring Award from the Natural Resources and Environment Ministry for three consecutive years between 2005 and 2007. The three projects received the awards were Perfect Place Rattanathibet, Perfect Place Ramkhamhaeng phase1 and Perfect Place Ramkhamhaeng phase 2 and 3. Perfect Place Ramkhamhaeng Phase II also won the EIA Monitoring Awards from the Natural Resources and Environment Ministry in 2008

In addition, the company provides public gardens, lakes, large and perfect club houses and shops in the club house areas to facilitate customers. The company has teamed up with business partners to open their shops in the club house areas such as Black Canyon, Clark Hatch Fitness Center, V Shop and 108- Shop Convenience stores, and Dokya Book store. These facilities differentiate the company’s projects from others’, creating the friendly ambience to residents who have warmly welcomed the concept.

ANNUAL REPORT 2010 PROPERTY PERFECT 49 • Pricing The company has policy to set prices based on the economic condition, market demand and competition. These factors are jointly considered with costs, locations, project types and market conditions when compared with competitors. There are several guidelines for price setting such as setting higher price than rivals but better designs, and environmental and convenient facilities..The company has offered various project types and prices starting from aBt1.0 million to the luxurious projects with prices in a range of Bt7 million up to serve different demand as follows :

The table described residence prices by brand Pricing (Unit: Million Baht) Type 1.0 – 2.0 2.0 – 3.0 3.0 – 4.0 4.0 – 5.0 5.0 – 6.0 6.0 up

7.0 MB UP

3.5 - 7.0 MB

2.5 - 5.0 MB

SDH

3.0 - 5.0 MB

1.7 - 3.0 MB TH / DH

2.0 - 5.0 MB

1.2 - 3.0 MB

1.0 - 2.0 MB

CONDO 1.0 - 1.2 MB

50 PROPERTY PERFECT ANNUAL REPORT 2010 Place • Location The company’s projects are mostly located in high-potential locations, set along the electric train routes or new roads. Comparatively to competitors’ products, the projects are of higher potential and offer greater traveling convenience. • In the North and West of Bangkok, the projects are located near the Purple Line (Bang Sue- Bang Yai) and the Red Line (Bang Sue-Taling Chan). Others are on Ratchaphruek Road, with connections to Rama IV Bridge (Pak Kret) and Chaeng Wattana Road. • In the East, the projects are near the Airport Rail Link, Suvarnabhumi Airport, and the outer ring road (East) that links the North and South of Bangkok, as well as the Motorway that leads to Chon Buri and Pattaya. • City projects are in business areas like the Ekamai-Ram Intra Road,Motor Way road, near Airport Rail Link, BTS and MRT subway as well as the routes to be opened soon. They are mostly up-scale housing units(Perfect Masterpiece), 3-storey townhouses (The Metro) and condominium (Metro Park, Metro Sky, i-Condo).

To win more shares in potential locations, in 2011, the company and subsidiaries plan to launch 14 new projects with combined value of Bt17,035 million.

Promotion • Advertising & Placement The company has applied the integrated communications as newspaper, TV Scoop, radio spot, Billboard, Direct mail etc, in selling the products. Mass media is exploited for the one-time advertisement to advertise a number of projects to target customers in lower advertising cost. Complimenting the strategy is the direct marketing, whereby a specific media is chosen for a particular target group and a particular campaign. The company also resorts to new communications channels like the Internet, marketing events and customer relationship management (CRM) to take care of existing customers. The Perfect Friend Club is launched to thank existing customers who introduce the projects to their friends, as a means to effectively reach out to target customers at a low cost. The ratio of units sold under the scheme has been significantly rising, thanks to clients' recommendations to their friends and relatives.

The company has been offensive in terms of marketing activities. It is reaching out to customers through website, social media (Facebook and Twitter), and specialized activities for customers visiting the websites of the company and subsidiaries. Through the warmly-welcomed Perfect Card membership, it also builds a communication linkage with customers to promote the company’s products.

In 2010, the company was active in marketing activities and customer relationship management (CRM). Activities were hosted all year round, to ensure continued communications with project residents and target customers. Activities outside the company’s premises included the Perfect Showcase at Impact Challenger in the fourth quarter.

The company has devised unique promotions for particular groups of target customers with realization of their different preferences, to speed up their buying decision process. The strategies take into account economic environment at a certain period. For example, for customers seeking a complete house, with help

ANNUAL REPORT 2010 PROPERTY PERFECT 51 from leading financial institutions, they are offered with low-interest loans, an extended borrowing period, and the step installment program. Through cooperation with leading furniture makers, the company offers customers a chance to buy a house with furniture at special prices, to help them save shopping time and reduce the need for an interior design. Special furniture prices also save their money, as loans for furniture purchase often carry higher interest rate than mortgage loans. Brand Building Strategies

The company’s brand has been differentiated from competitors’. The Brand DNA is created under the “Happy Living” concept, to underline the company’s focus in creating the new living standards for all residing in the Property Perfect projects. Happy Living contains 4 main happiness-supporting components • House (Happy with Perfect Quality) Residing in high-quality houses, which are well-designed for maximized functions and pleasant look as well as for energy saving and environmental friendly purposes. The construction works are closely and thoroughly monitored and applied modern technology like the prefabrication which ensures short construction period but standard quarter. All the units are also subjected to the QC Pass system before delivery to customers. • Security (Happy with Peace of Mind) Deriving from maximum security. Through cooperation with Thai Secom Pitakkij Co., Ltd. (SECOM), a leader security system provider in Japan, the trustworthy Home Security system is designed for all projects to cover from the entrance, guard booths and the overall projects’ space to customers’ home. • Lifestyle (Happy with Healthy Lifestyle) Property Perfect is more than just a home. Here, activities are created to meet customers’ lifestyles. The projects are fully equipped with facilities like a giant club house, where fitness, swimming pools, gyms, shops and other services. The central area is also open for relaxing and exercising purposes as well as family activities, something that they need not to find outside the projects. • Green Environment (Happy with Friendly Environment) Near-nature environment is provided, with the larger central space which offers floral trees and large lakes for cool living amid fresh air.

The company believes that a successful brand is built upon customers’ good experiences, which will lead to the company’s sustainable image. The construction works, design and project planning are thus properly designed, along with emphasis on environment management, infrastructure and security inside the projects. Activities are also hosted for better relationships among residents, to create a warm community and happy environment to all residents. Favorable communities spark words of mouths among residents of the company and subsidiaries’ projects, which is a sustainable way to build brand. Target Group The company has specified products accordingly to their brands, taking into account the locations, and area's growth potential, competition and development cost. The company has the policy to launch projects of different price tags in each area to cover different targets.

The company’s projects are developed under the following 9 brands, to cover all market segments. Condominiums 1. “Metro Park” covers low-rise condominiums near mass transit routes, where 70% of central area, including the lake and the club house, is provided.

52 PROPERTY PERFECT ANNUAL REPORT 2010 2. “Metro Sky” focuses on high-rise downtown condominiums, which also boasts the green space, the Sky Lounge and other facilities. 3. “iCondo” covers low-rise condominiums near mass transit routes, will be carried out by subsidiary Bright Development Bangkok Co, Ltd. with the price tag of Bt1-Bt2 million.. 4. “UNILOFT” Low-rise condominium will be carried out by subsidiary Bright Development Bangkok Co.,Ltd. It on densely-populated locations near universities, with the price tag of Bt1-Bt1. 2 million. The project will be launched in 2011. Townhouses 5. “The Villa”, a project near electric train routes and communities for new families. • Undertaken by the company are a 2-storey townhome project and a modern twin house project, which comes with vast green area, a lake and a big clubhouse. Price tag is Bt1.7-Bt4 million per unit. • Launched by a subsidiary (Estate Perfect Company Limited) is “The Villa” 2-storey townhome project, priced Bt2-Bt3 million. 6. “The Metro” - covering 3-storey modern city townhouse, located along electric train routes and near facilities. Single Detached houses 7. “Perfect Park”, a multi-design single detached house and twinhouses that offers green space and Club House to start-up families. 8. “Perfect Place”, a single detached house on convenient locations, completed with lavish green space, lakes and Club House for medium-sized families 9. “Perfect Masterpiece”, a spacious single detached house for larger families, standing amid huge green space and Club House. Competition In the first quarter of 2010, property developers enjoyed a sharp growth in revenue. Despite political turbulence, the market was buoyant thanks to the ending of property tax measures imposed on 29 March 2008. Home buyers rushed their decision, while major developers sped up on the sale, construction and inventory release. After the tax measures ended, developers delayed new projects in the face of political upheaval which depressed sale figures. A large number of projects were launched late third quarter and in the fourth quarter, mostly low-priced condominiums, on regained confidence in the government stability.

ANNUAL REPORT 2010 PROPERTY PERFECT 53 In this year, the market will be dominated by major developers, trying to snatch bigger shares in each product category. Pricing and product strategies will be rolled out, including collaboration with business partners in launching promotions to speed up the buying-decision process. The company will maintain the product differentiation policy, as well as focus on the appropriate locations and reasonable pricing in each area mainly to satisfy customers.

The company entirely devotes its resources on residential property development, offering single detached houses, townhouses and condominiums. By location, they are put into 4 categories. Group 1: Excellent locations downtown (within 15km radius) In 2010, the company will increase the condominium products, priced Bt1-Bt3 million, following the success of Metro Park Sathorn, a condominium near the extended Green Line electric train route which welcomed warm response. The new project, offering traveling convenience, will be located along the BTS skytrain and the MRT subway. It will also feature cozy environment and facilities, which are the company's highlights. New project in this range will be unveiled. Metro Sky will be unveiled on Ratchadapisek and Sukhumvit Road. As oil prices should continue to rise, this will push skyhigh the demand for condominiums near mass transit routes.

Group 2: Good locations (within 15-20km radius from downtorwn) Most of the company's projects are in this group, which shows fierce competition due to relatively closeness to downtown and traveling convenience due to continued mass transit development. The prices of land along the mass transit routes are increasing, as they are the development areas for residential units priced from Bt3 million. The areas include Ratchaphruek Road, Rattanathibet Road, new Rama IX Road, the outer ringroad and On-Nut Road. These areas house the company's projects under the Masterpiece, Perfect Place, Perfect Park, the Metro and the Villa brands.

Group 3: Suburban projects (20-30km radius) The projects have faced intensifying competition, due to relatively low land prices. The area can be developed into housing estates with price tag below Bt4 million. Most of the developers are concentrated in the area, as buyers in this income group are the biggest. However, concentration results in oversupplies. That led to a price war and pressures the selling price as well as margins. The company has plans to develop projects in this area to increase the market share and expand brand awareness of the Perfect Park and the Villa brands.

Group 4: Poor locations or out of town Some homebuyers are ready to buy houses far away from the city areas due to the cheap prices. All expect the housing value to rise in tandem with infrastructure and the upward trend in oil prices. Most of the buyers are people who have been residing in the areas for some time.

54 PROPERTY PERFECT ANNUAL REPORT 2010 Real Estate Industry Outlook and Trend

The Thai economy in 2010 showed a strong recovery from the 2.3% contraction in the previous year, with the high growth rate of 7.8% (Source: Fiscal Policy Office). The growth was attributable to exports thanks to the economic recovery of major counterparts, as well as private consumption and investment. Farmers enjoyed higher income on higher agricultural crops prices. The manufacturing sector expanded in line with robust exports and domestic consumption. All indicators showed the obvious economic recovery.

The recovery pace is expected to continue in 2011, with growth forecast of 4.5% (Source: Fiscal Policy Office), driven by domestic demand. Private investment and consumption tends to rise further due to higher farm income, civil servants’ pay hike and manufacturing expansion to meet export orders. Export growth should remain high, albeit slightly lower than the previous year with fragile economic recovery in advanced economies. The tourism sector should show an improvement from last year, when it was badly hurt by political impacts. Government spending and investment is expected to increase.

Amid rosy forecasts, some risks remain. For instance, 1. Fragile recovery in global economy, 2. Inflationary pressure driven chiefly by higher oil prices and agricultural products prices which would raise cost of living and hurt consumer confidence, 3. Upward interest adjustment due to rate normalization starting late 2010 which will push up the financial cost of consumers and business operators, and 4. Domestic political stability. These factors will hurt business and consumer confidence and could affect domestic consumption and investment – expected to be the major economic engines this year.

In 2010, the real estate industry, though suffering from political turbulence in the first half, benefited largely from property tax incentives. Imposed on 29 March 2008, the incentives ended early in the year and sped up buyer’s decision. Developers gained handsomely on the acceleration of the construction and sale of mainly inventories, as political turbulence led to the launch of few new projects. Sales dropped significantly in the third quarter as huge demand was absorbed while developers delayed new projects, pending for clarity. New projects were launched late third quarter and in fourth quarter, mostly condominiums for low-income earners which witnessed substantial booking.

The number of residential units in the Greater Bangkok transferred during January-November 2010 rose 12% from the same period in the previous year. Contributing largely to the increase were condominium units, which accounted for 40% of the overall housing market. In the period, the number of condominium units transferred increased 33% on year, against 5% contraction in the single detached house segment and a 3% rise in townhouses. In the first 11 months, the number of completed and registered housing units increased 13%. Condominium units, accounting for 53.6% of total, showed an increase of 10%. The number of single houses and townhouses, accounting for 30% and 12.5% of the industry, increased 8% and 60%, respectively. (Source: Real Estate Information Center, Government Housing Bank)

In the period, the number of newly-launched units went up 97.9% on year (mostly low-income condominiums) while sales increased 62% on year. At the end of the year, outstanding inventory rose only 19% from the previous year, mostly consisting of condominiums which are slated for completion in the next 1-2 years. (Source: Agency for Real Estate Affairs) The figures showed that supply was well absorbed and most inventory were units unfinished or not yet constructed. A large number of completed units were sold before the property tax incentives ended.

ANNUAL REPORT 2010 PROPERTY PERFECT 55 New projects managed to complete construction and transfer completed units, while some locations – like new electric train lines and extension routes - witnessed a spike in supply on expectation of huge demand in the future. Without tax incentives to boost the industry like in the past three years, the market will this year grow in line with the economic growth which has an influence on consumer confidence. Inflation and interest rate trend will play a key role in influencing buyers’ decision, as well as the political condition which could send a psychological impact and sway economic confidence.

Concrete progress on new electric train lines and extension routes could however boost housing demand, as well as projects which could meet consumers’ preferences. This should further spur demand, but all still depends on competition and supporting factors in each location.

On competition, developers shoulder higher operating cost due to the end of tax incentives as well as the increases in other costs – financial, construction and land costs, for instance. It would make it harder particularly for small developers to launch new projects. The market would then be dominated by large-sized operators who possess financial strength as well as advantages in terms of construction cost and marketing.

Success factors lie in the ability in responding quickly to changing market conditions and the ability to offer new designs and new locations. Successful developers are those who can spot opportunities and come up with a comprehensive range of multi-priced products for a higher market share.

Small-sized housing units would play a more crucial role, thanks to a change in purchasing power and consumer behavior. Consumers are cutting purchase budgets due to lower purchasing power, the continued rises in housing prices compared to income growth, changing lifestyles (smaller family sizes or late marriage), or preference for traveling convenience. All these are driving them towards small units like condominiums, twinhouses and townhouses. Still, single houses will remain in high demand among family dwellers in search of traditional lifestyles amid preferred quality of life and environment. Located in suburbs, they could find more buyers on the back of economic recovery and improved consumer confidence, as well as new transportation routes like new roads, expressways and bridges. In particular, the construction of new electric train routes has started and some are open.

Housing registration during January-November 2010 (See Graphic 1) was slightly above the figure in the previous year. Due to the massive launch in the past few years, condominium units accounted for 52% of total. The number of single detached houses stabilized after gradual drops in the past 4-5 years. The number of completed townhouses escalated, but at a stable rate as most remained under construction. As supported by the increasing transfer records, the figures showed the normal situation on supply. Developers-built units during 1995-2009 and 2010 (January-November)

56 PROPERTY PERFECT ANNUAL REPORT 2010 Housing registration in the Greater Bangkok (1995-2009, January-November 2010) 2538 2539 2540 2541 2542 2543 2544 2545 2546 2547 2548 2549 2550 2551 2552 SDH 48,909 44,877 41,305 23,985 17,469 23,128 24,041 24,973 34,592 44,248 46,643 42,764 38,705 34,618 28,998 Duplex 1,089 791 1,009 196 178 539 227 80 1,444 945 678 965 1,556 2,296 1,138 House TH&Shop H. 61,944 60,373 43,480 11,895 2,319 2,728 5,062 7,011 1,2950 15,418 13,858 17,421 17,837 14,616 11,116 CD 66,911 70,575 62,837 30,978 9,063 6,679 4,650 5,118 7,399 8,439 10,534 18,607 17,432 34,049 53,725 Total 178,853 176,616 148,631 67,054 29,029 33,074 33,980 37,182 56,085 69,050 71,713 79,757 75,530 85,579 94,977 Note: SDH (single detached house), Duplex House (twin house), TH & Shop H. (townhouse & shophouse), CD (condominium) Source: Real Estate Information Center, Government Housing Bank

Graphic 1: Number of registered housing units in the Greater Bangkok by category during 1995-2009 and 2010 (January-November)

The property market changed drastically, as seen through the number of newly-launched units in 2010 (See Graphic 2). The number of condominium units increased sharply by 154.1%, following a drop in new project launches and huge transfers in the previous year. The number of townhouse units increased 54.4%. The two segments enjoyed a big boost due to the government’s promotion for low-income housing development. Developers were encouraged to respond to the policy and these types of property were in huge demand. A large number of projects in other segments in the year also jumped late in the year, thanks to developers’ greater confidence as well as a significant drop in inventory. The figures reflect the fact that the construction of units available now may not yet start, showing a certain investment flexibility.

On condominium supply, the situation is worrisome in some locations which witness a sharp increase in the number of units and opening prices. In the short term, this could increase competition and cause problems in supply absorption. However, projects with preferable designs and locations should remain warmly welcomed. In the long term, low-income condominium units should be the most popular, like what happens in other countries.

ANNUAL REPORT 2010 PROPERTY PERFECT 57 Graphic 2: Comparison of newly-launched units by category (2009-2010)

A sharp increase in land prices will pose limitations in low-rise housing development, while the extension of mass transit networks should also influence a change in buyers’ behavior.

No. of newly-launched units (2009-2010) 2009 2010 Changes% SDH 11,157 17,353 55.5% Duplex House 2,665 2,925 9.8% TH 19,079 31,365 64.4% Condo 23,993 60,972 154.1% Total 56,894 112,615 97.9% Source: Agency for Real Estate Affairs

The aforementioned data leads to the conclusion that though cost of living and interest rates will play a greater influential role on housing demand and purchasing power in 2011 along with some psychological impacts from the political situation, consumer confidence to the economy remains high and tends to dictate consumers’ decision. From the supply perspective, competition is evident particularly in the segments that corresponds consumer income and buying behaviors. In the market, as much of inventory has been absorbed, large sized developers have dominated huge market shares and they should continue enjoying advantages. If all factors remain as they are today, competition may spike in the short term but the long-term property market outlook should remain bright on the back of continued economic growth.

58 PROPERTY PERFECT ANNUAL REPORT 2010 Other Information

Financial structure The company's securities 1 Common shares Accounting year 31 Dec.2008 31 Dec.2009 31 Dec. 2010 Registered capital - Value (Bt) 6,552,000,000 6,552,000,000 6,552,000,000 - No. of shares 1,092,000,000 1,092,000,000 1,092,000,000 Registered capital - Value (Bt) 4,726,329,720 4,726,329,720 4,726,344,720 - No. of shares 787,721,620 787,721,620 787,724,120 - Par value (Bt. /Shares) 6.00 6.00 6.00

As of 31 December 2008, the company’s registered capital stood at Bt6,552,000,000 (1,092,000,000 shares at Bt6 par value), up by Bt338,434,824 (56,405,804 shares at Bt6 par value) from Bt6,213,565,176 million (1,035,594,196 shares at Bt6 par value) at end-2007. Shareholders at the 1/2008 extraordinary meeting on 20 June 2008 approved the company’s capital reduction from Bt6,213,565,176 (1,035,594,196 shares at Bt6 par value) to Bt5,589,565,176 (931,594,196 shares at Bt6 par value), by canceling 104,000,000 unallocated shares at Bt6 par value worth Bt624,000,000 which were reserved for the conversion of convertible debentures. The shareholders also approved the capital increase from Bt5,589,565,176 (931,594,196 shares at Bt6 par value) to Bt6,552,000,000 บาท (1,092,000,000 shares at Bt6 par value) to accommodate the debenture conversion to common shares. The capital decrease and increase was registered with the Commerce Ministry on 1 July 2008 and 2 July 2008, respectively. As of 31 December 2009, the company’s registered capital totaled Bt6,552,000,000 (1,092,000,000 shares at Bt6 par value) and paid-up capital totaled Bt4,726,329,720 (787,721,620 shares at Bt6 par value). As of 31 December 2010, the company’s registered capital totaled Bt6,552,000,000 (1,092,000,000 shares at Bt6 par value) and paid-up capital totaled Bt4,726,344,720 (787,724,120 shares at Bt6 par value). The paid-up capital increased Bt15,000 following the exercise of warrants (for 2,500 shares at Bt6 apiece) in December 2009. The new shares were registered with the Commerce Ministry on 11 January 2010.

2 Warrants (a) Warrants issued to uncollateralized creditors Under the Rehabilitation Plan, the company must issue free warrants to creditors with uncollateralized loans, at the ratio of 7 warrants per every Bt1,000 debt. Each warrant can be exercised for 1 share, at the price of Bt0.01. The company won the Securities and Exchange Commission to offer 53,000,000 warrants, with 10-year maturity, on 7 November 2002. The exercise date is fixed for the last day of the second and fourth quarters of each year, starting from the fourth quarter in 2002. Receivership officers later abolished some creditors’ claims. The company had issued only 50,930,000 warrants, and 2,070,000 were left unallocated. Shareholders at the 1/2005 meeting approved the cancellation of the remaining warrants. As of 31 December 2010, the number of remaining warrants which are not yet exercised stood at 8,863,476 units.

ANNUAL REPORT 2010 PROPERTY PERFECT 59 (b) Warrants to directors and/or employee (ESOP) Shareholders at the 2005 general meeting on 7 April 2005 approved the employee stock option program (ESOP), by which 39,000,000 free warrants would be issued to di- rectors and/or employees. The warrant holders can exercise one warrant for one share at the price of Bt6, within the 5-year exercise period. The company has not yet issued any warrants. The extraordinary shareholders meeting No.1/2008 on 20 June 2008 approved the cancel- lation of the offering of 39,000,000 shares, reserved for the exercise of warrants issued to directors and/or employee (ESOP). The ESOP program was approved at the 2005annual general meeting on 7 April 2005.

3 Convertible debentures : 1/2005 Issue Issue date : 25 November 2005 Type : unsecured holder-bearing convertible debentures, without trustee Offered to : Foreign institutions through a private placement, in US dollar, fully hedged at all cost by investors No. of units : 200,000 Price : US$100 Maturity : 5 years from issue date (25 November 2005) Interest rate : fixed 3.50% Interest payment : on 25 February, 25 May, 25 August and 25 November every year until schedule maturity. The first interest payment was made on 25 February 2006. Principal payment : The unconverted debentures will be redeemed in US dollar, with 31.60% premium from the issue price. The redemption is fixed with the foreign exchange rate as of the issuance date.(41.15 Baht::US $) Conversion price : Bt6.25 Conversion period : 18 months after offering, until the redemption date with the mnimum conversion of US$1 million Conversion : The company withholds the right to call holders to convert 1 third of the conditions original number of debentures when Over 10 million shares are traded on average during the 45 days before the company would exercise the right, and The company’s average share closing price during the 60-day period and the closing of the 5 days before the company would exercise the right accounts for - 130% of conversion price in Year 1-2 - 150% of conversion price in Year 3 - 175% of conversion price in Year 4-5 Then, the company can ask the bearers to convert one third of the original number of debentures under these conditions. 1. The bearers who were forced to convert the debentures sold out all the common shares, or 2. The company can exercise the right again at least 60 days after the first right exercise. Under this condition, the number of shares traded and the average share closing must fit the earlier conditions. Bearers’ conditions : The company would hold a meeting to appoint an individual, nominated by

60 PROPERTY PERFECT ANNUAL REPORT 2010 any foreign institutional investor who bought and paid US$20 million upwards for the debentures, a director. Note : The company redeemed unsubordinated convertible debentures on 25 November 2010.

4. Debentures Debentures as of 31 December 2010 are as follows; (a) Secured debentures #1/2009 Specific name : “Secured debentures of Property Perfect Public Company Limited #1/2009, maturing in 2012” Type : Holder-bearing, secured debentures with trustee No. of debentures : 520,000 units Face value : 1,000 Baht Issue size : Bt520 million Offering method : Public offering to the general public and institutional investors Issue date : 3 June 2009 Maturity : 3 years from issue date Maturity date : 3 June 2012 Interest rate : Fixed 6% per annum Interest payment schedule : 3 March, 3 June, 3 September and 3 December of every year throughout the debentures’ life. Principal repayment : Principal payment maturity date, 3 June 2012 * Early redemption : None Other significant condition : Debt to equity ratio must be maintained at no more than 1.75:1 Credit rating : “BBB+” by Fitch Ratings (Thailand) Trustee : TMB Bank Public Company Limited Registrar : TMB Bank Public Company Limited Secondary market : Thai Bond Market Association * At the 11 August 2010 meeting, bondholders approved the extension of maturity date of collateralized debentures No.1/2009 from 3 June 2012 to 3 September 2010. The bonds and collaterals were redeemed. (b) Two series of secured debentures #2/2009 Specific name : Series 1: Secured debentures of Property Perfect Public Company Limited #2/2009 (Series 1), maturing in 2011” Series 2: Secured debentures of Property Perfect Public Company Limited #2/2009 (Series 2), maturing in 2012” Type : Holder-bearing, secured debentures with trustee No. of debentures : Series 1 : 300,000 units Series 2 : 800,000 units Face value : 1,000 Baht Issue size : 1. Series 1 : Bt 300million 2. Series 2 : Bt 800million

Offering method : Public offering to the general public and institutional investors

ANNUAL REPORT 2010 PROPERTY PERFECT 61 Issue date : Series 1 : 14 August 2009 Series 2 : 14 August 2009 Maturity : Series 1 : 1 years and 6 months from issue Series 2 : 3 years from issue date Maturity date : Series 1 : 14 February 2011 Series 2 : 14 August 2012 Interest rate : Series 1 : Fixed 4.85% per annum Series 2 : Fixed 6% per annum Interest payment schedule : 14 February, 14 May, 14 August, and 14 November of each year throughout the maturity. Principal payment : Series 1 : Payment on maturity, 14 February 2011 Series 2 : Payment on maturity, 14 August 2012 Early redemption : None Other significant condition : Debt to equity ratio must be maintained at no more than 1.75:1 Credit rating : “BBB/Stable” by Tris Rating Co., Ltd. Trustee : Bank of Ayudhya Public Company Limited Registrar : Bank of Ayudhya Public Company Limited Secondary Market : Thai Bond Market Association

(C) Partially-collateralized debentures #1/2010 Specific name : Partially-collateralized debentures of Property Perfect Public Company Limited #1/2010, maturing in 2013 Type : Holder-bearing, partially-collateralized debentures, with trustee No. of debentures : 1,500,000 units Face value : 1,000 Baht Issue size : Bt1,500 million Offering method : Public offering to the general public and institutional investors Issue date : 26 February 2010 Maturity : 3 years from issue date Maturity date : 26 February 2013 Interest rate : Fixed 5.9% per annum Interest payment schedule : 26 February, 26 May, 3 August and 26 November of every year throughout the debentures’ life. Principal payment : Principal payment maturity date, 26 February 2013 Early redemption : None Other significant condition : Debt to equity ratio must be maintained at no more than 1.75:1 Credit rating : “BBB/Stable” by Tris Rating Co., Ltd. Trustee : TMB Bank Public Company Limited Registrar : TMB Bank Public Company Limited Secondary Market : Thai Bond Market Association

62 PROPERTY PERFECT ANNUAL REPORT 2010 (D) Short-term debentures # 1/2010 Specific name : Short-term debentures of Property Perfect Public Company Limited # 1/2010, maturing on 20 May 2011 Type : Unsecured unsubordinated holder-bearing debentures No. of debentures : 500,000 units Face value : 1,000 Baht Issue size : Bt 500 million Issue date : 26 August 2010 Maturity : 267 days from issue date Maturity date : 20 May 2011 Interest rate : Fixed 4.65% per annum Interest payment schedule : Once, on maturity date Principal payment : Principal payment maturity date, 20 May 2011 Early redemption : None Registrar : Bank of Ayudhya Public Company Limited Secondary Market : Thai Bond Market Association

(E) Secured debentures #2/2010 Specific name : “Secured debentures of Property Perfect Public Company Limited #2/2010, maturing in 2012” Type : Holder-bearing, secured debentures with trustee No. of debentures : 1,000,000 units Face value : 1,000 Baht Issue size : Bt1,000million Offering method : Public offering to the general public and institutional investors Issue date : 9 September 2010 Maturity : 1 year and a half from issue date Maturity date : 9 March 2012 Interest rate : Fixed 5.5% per annum Interest payment schedule : 9 March, 9 June, 9 September and 9 December of every year throughout the debentures’ life. Principal payment : Principal payment maturity date, 9 March 2012 Early redemption : None Other significant condition : Debt to equity ratio must be maintained at no more than 1.75:1 Credit rating : “BBB-/Stable” by Tris Rating Co., Ltd. Trustee : Bank of Ayudhya Public Company Limited Registrar : Bank of Ayudhya Public Company Limited Secondary Market : Thai Bond Market Association

ANNUAL REPORT 2010 PROPERTY PERFECT 63 (F) Secured debentures #3/2010 Specific name : “Secured debentures of Property Perfect Public Company Limited #3/2010, maturing in 2013” Type : Holder-bearing, secured debentures with trustee No. of debentures : 1,000,000 units Face value : 1,000 Baht Issue size : Bt1,000 million Offering method : Public offering to the general public and institutional investors Issue date : 18 November 2010 Maturity : 3 years from issue date Maturity date : 18 November 2013 Interest rate : Fixed 5.8% per annum Interest payment schedule : 18 November, 18 February, 18 May and 18 August of every year throughout the debentures’ life. Principal payment : Principal payment maturity date, 18 November 2013 Early redemption : None Other significant condition : Debt to equity ratio must be maintained at no more than 2:1 Credit rating : “BBB-/Stable” by Tris Rating Co., Ltd. Trustee : Siam City Bank Public Company Limited Registrar : Siam City Bank Public Company Limited Secondary Market : Thai Bond Market Association

(G) Unsecured debentures #4/2010 Specific name : Unsecured debentures of Property Perfect Public Company Limited #4/2010, maturing in 2012 Type : Unsecured holder-bearing debentures with trustee No. of debentures : 1,500,000 units Face value : 1,000 Baht Issue size : Bt 1,500 million Offering method : Public offering to the general public and institutional investors Issue date : 18 November 2010 Maturity : 2 years from issue date Maturity date : 18 November 2012 Interest rate : Fixed 6.5 % per annum Interest payment schedule : 18 February, 18 May, 18 August and 18 November of every year throughout the debentures’ life. Principal payment : Principal payment maturity date, 18 November 2012 Early redemption : None Other significant condition : Debt to equity ratio must be maintained at no more than 2:1

64 PROPERTY PERFECT ANNUAL REPORT 2010 Credit rating : “BB+” by Tris Rating Co., Ltd. Trustee : Siam City Bank Public Company Limited Registrar : Siam City Bank Public Company Limited Secondary Market : Thai Bond Market Association

Secured debentures of Bright Development Bangkok Co.,Ltd. On 18 August 2008, Bright Development Bangkok Co.,Ltd, Bright a subsidiary, issued 462,150 units of secured debentures, as approved by Bright shareholders at the extraordinary meeting on 15 May 2007 . At face value of Bt1,000 apiece, the issue size totaled Bt462,150,000. The debentures were issued to a financial institu- tion. The maturity date of the debentures, which carry THBFIX plus 5.55256% interest rate, was 28 November 2008. The debentures were guaranteed by the company, partial land and buildings of the company and Bright Development, and the mortgage of Bright shares which are owned by the company. On 26 February 2009, Bright amended the borrowing contract with the financial institution, to redeem the debentures in lots with total redemption scheduled within May 2009. The debentures carried THBFIX rate plus 8.55256% per annum. On 27 May 2009, Bright sought another amendment, to redeem the debentures in lots with total redemption scheduled within February 2010. The THBFIX coupon rate carried differential of 8.55256% per annum until November 2009 and the differential of 10.05256% during December 2009 and February 2010. Bright had redeemed all the debentures. Debentures are subjected to normal business practices and limitations of the company and subsidiaries.

ANNUAL REPORT 2010 PROPERTY PERFECT 65 66 Management and Authorized Person of the Company PROPERTY PERFECT On 31 December 2010 Name-Title Age Academic Qualifications Equity Rela- Career experience within the past 5 years Company / Business Type Hold- tion- ing ship Timing Designation 1 Dr.Tawatchai Nakhata 63 • Ph.D. University of Illinois 0.001 % 2008 - Present Chief Executive Director Property Perfect Public Company Limited Chairman / • Audit Committee Program (ACP) 13/2006 ; 1992 – Present Chairman Property Perfect Public Company Limited ANNUAL REPORT 2010 Chief Executive Director/ Director Accreditation Program (DAP) 2010 - Present Chairman of Audit Committee Khonburi Sugar Public Company Limited Authorized signatory directors 52/2006 ; Thai Institute of Directors; IOD / Independent Director 1981 - Present Follow Member The Engineering Institute of Thailand 2006 - 2009 Chairman Ceda Co., Ltd. / Structural engineering design service 1995 - 2006 Managing Director Ceda Co., Ltd. 2 Mr.Chainid Ngow-Sirimanee 56 • Bachelor of Laws Chulalongkorn University 0.844% 1985 - Present Chief Executive Officer / Property Perfect Public Company Limited Directors • Thai Barrister-at-Law Thai Bar Association Deputy Chief Executive Director Chief Executive Officer/ 2007 – Present Director Bright Development Bangkok Co., Ltd. / Real Estate Deputy Chief Executive Director/ 2007 – Present Director Centre Point Shopping Mall Co., Ltd. / Real Estate Authorized signatory directors 2002 – Present Director Krungthep Land Public Company Limited / Real Estate 1999 – Present Director Estate Perfect Company Limited / Real Estate 1995 - 2010 Director Thai Property Public Company Limited / Real Estate (Formerly known as “Rattana Real Estate Public Company Limited”) 3 Mr.Virayuk Puntupetch Director / 64 • Master of Science 2010 - Present Deputy Chairman / Property Perfect Public Company Limited Independent Director / • Bachelor of Arts (Political Science), Chairman of the remuneration committee Chairman of the Audit • Certificate in Financial Policy Analysis Program 2007- April 2010 Chairman of Audit Committee Property Perfect Public Company Limited Committee International Monetary Fund, 2007- Present Director / Independent Director Property Perfect Public Company Limited Washington DC, USA. 2007 Retired Government Officer The Secretariat of the Prime Minister Office • Certificate in Stock Market Development Program 2005-2006 Advisor to the Prime Minister Government officials in charge of international trade affairs Securities and Exchange Commission, The office of Thai Trade Representative Washington DC, USA 2004 Head of advisor to the Prime Minister Office of the Civil Service Commission • Certificate in Executive Program, 2000 - 2004 Inspectors-General / Director Ministry of Finance / Vayupak Fund Harvard University, USA. 1998 -2000 Deputy Director -General / Director Fiscal Policy Office / Office of General Administration for 33rd Annual Meeting of the Board of Governors of Asian Development Bank 1996-2000 Director Office of the Neighboring Countries Economic Development Cooperation Fund 1994-1998 Specialist Expert for Debt Management Fiscal Policy Office 1994 Director Saving & Investment Policy Division, Fiscal Policy Office 1989 Director Capital Market Development Policy Division, Fiscal Policy Office 1986 Director Financial and Financial Institution Policy Division, Fiscal Policy Office 1979-1980 Assistant to Country Executive World Bank Washington DC, USA. Director of SEA Group 1972 second-class specialist/ Division Chief Bureau of Tax Policy, the Fiscal Policy Office

4 Dr. Somsak Toruksa 59 • Ph.D., Laws, Ramkhamhaeng University 0.00% 2010 - Present Chairman of the Nominating Committee Property Perfect Public Company Limited Director / • Master of Laws Ramkhamhaeng University 1998 - Present Director / Independent Director / Property Perfect Public Company Limited Independent Director / • Audit Committee Program (ACP) 13/2006 ; Audit Committee Audit Committee / Director Accreditation Program (DAP) 52/2006 ; 1993 - Present Managing Director Somsak Toruksa Law Office Co., Ltd. / Law Chairman of the nominating Thai Institute of Directors(IOD) committee

5 Mr. Vidhya Nativivat 56 • Master of Laws 1.343 % 2004 - Present Non Executive Director / Nominating Property Perfect Public Company Limited Non Executive Director / The George Washington University, USA Committee / Remuneration committee Nominating Committee/ • Bachelor of Laws, Thammasat University 1986 - Present Managing Director Bunchong and Vidhya Law Office Ltd. / Law Remuneration Committee • Director Accreditation program(DAP)77/2005; Thai Institute of Directors(IOD)

Name-Title Age Academic Qualifications Equity Rela- Career experience within the past 5 years Company / Business Type Hold- tion- ing ship Timing Designation 6 Dr. Thamnoon Ananthothai 53 • Ph.D., International Management, 0.000 % 2010 - Present Risk Management Committee Property Perfect Public Company Limited Director / Walden University, Naples, Florida USA. 2005-Present Director / Independent Director / Property Perfect Public Company Limited Independent Director / • A.C.A. Certificate, Audit Committee Audit Committee /Risk Man- American Accreditation Council for 2008-Present Director / Audit Committee Bangkok University , Bangkok, Thailand agement Committee Accountancy, USA. 2007-Present Vice Chairman / Chairman of the Audit Better World Green Public Company Limited • M.B.A., Management, The University Committee of Sarasota-Sarasota, Florida, USA. 2007-Present Director / Chairman of the Audit Committee IFS-Capital (Thailand) Public Company Limited • B.A., Accountancy & Management, 2006-Present Director / Chairman of the Audit Committee Eastern Printing Public Company Limited Eckerd College-St. Petersburg, USA. 2005-Present Director / Audit Committee Ua WIthaya Public Company Limited • Audit Committee Program(ACP) 10/2005, 2004-Present Executive Director Merchant Partners Securities Limited Director Accreditation Program(DAP) 48/2005, 2001-Present Executive Board Member / Sub-Committee Clearing House of The Agricultural Futures Exchange of Thailand Director Certification Program (RCP) 14/2006, 2001-Present Director of the Investment Management The National Social Security Fund. Understanding the Fundamental of Financial Sub-Committee Statement (UFS) 1997-Present Director of Economic Sector Sub-Committee The Federation of Thai Industries. 7/2007; Thai Institute of Directors. 2002 - 2003 Dean of College of Business Administration Dhurakij Pundit University / University 1998 - 2002 Managing Director/ President & CEO DBS Thai Danu Securities Limited / Securities

7 Mr. David Bryce Van Oppen 44 • M.A. International Economics and Asian Studies, 0.000% 2007- Present Non Executive Director Property Perfect Public Company Limited Non Executive Director The Johns Hopkins University, U.S.A., 1998 - Present Director General Enterprise Management Services Ltd., Hong Kong • Bachelor Degree in Arts 1995 - 1998 Director / Investment Manager Lazard Asia Ltd., HongKong / (International Relations), Pomona College, U.S.A. Lazard Asia Investment Management Ltd.. 1993 - 1995 Senior Financial Analyst Smith Barney, Inc. 1988-1991 Manager Sunmar Shipping, Inc.

8 Mr.Ooi Bun Aun 52 • B.A. Business Administration National University 0.000 % 2008 - Present Non Executive Director Property Perfect Public Company Limited Non Executive Director of Singapore. 2007 - Present Financial & Management Consultancy East Alliance Asset Limited.(“EAAL”) 2004 - 2006 Managing Director Depfa Investment Bank Ltd., HongKong 1996 - 2006 Honorary Republic of Cyprus in Special Administrative Regions, Hong Kong, China. 2003 - 2004 Executive Director Standard Bank Group and the Group subsidiary Standard Bank Asia Ltd. 1998 - 2003 Group Vice Chairman / President TCC Group of companies

9 Mrs.Nuanual Swasdikula-Na- 61 • Bachelor of Laws , Thammasat University 0.003% 2010 - Present Nominating Committee Property Perfect Public Company Limited ANNUAL REPORT 2010 Ayudhaya • Thai Barrister-at-Law Thai Bar Association 2009 – Present Director / Property Perfect Public Company Limited Director / Independent Director / Independent Director / Chairman of Risk Management Committee Chairman of Risk 1996 - 2008 Executive Vice President TMB Bank Public Company Limited Management Committee / 1994 – 1996 Senior manager for commercial and TMB Bank Public Company Limited Nominating Committee construction finance 1992 – 1994 Commercial finance manager TMB Bank Public Company Limited 1991 – 1992 Industrial and commercial finance manager TMB Bank Public Company Limited 1990 – 1991 Business development manager TMB Bank Public Company Limited PROPERTY PERFECT 67 68 Name-Title Age Academic Qualifications Equity Rela- Career experience within the past 5 years Company / Business Type Hold- tion- ing ship PROPERTY PERFECT Timing Designation

10 Mr.Krish Follett 62 • MBA, Thammasat University 2010 - Present Director/ Independent Director / Property Perfect Public Company Limited Director / • Bachelor of Economic , Thammast University Chairman of Audit Committee / Independent Director / • Advanced Management Program, Harvard Remuneration Committee Chairman of Audit Committee/ Business School, BOSTON, USA 2010 - Present Director/ Independent Director / Chairman Amanah Leasing Public Company Limited Remuneration Committee of Audit Committee 2008 - 2009 Assistant Governor, Operation Division Bank of Thailand

ANNUAL REPORT 2010 2004 - 2008 Senior Directors, Internal Audit Depertment Bank of Thailand 2002 - 2004 Senior director for Audit 1 Department, Bank of Thailand Finance Control 1 Division 2000 - 2002 Director of Reorganization Department Bank of Thailand 1998 – 2000 Director of Operation Division, Northeastern Bank of Thailand Region Office 1996 – 1998 Assistant Director of Electronics Financial Bank of Thailand Transactions Center 1995 – 1996 Assistant Director of Northern Region Bank of Thailand Office Establish Unit 1992 – 1995 Director of Capital Market Audit Division Security and Exchange Commission 1991 - 1992 Chief of Special Department in Financial Bank of Thailand Institution Supervision in Practice 11 Mr. Phairat Senachack 61 • Mini MBA Thammasat University 0.000 % 1996 - Present Director / Executive Director / Property Perfect Public Company Limited Director / • Bachelor of Business Administration Assistant Chief Operating Officer Executive Director / Assumption University Deputy Chief Operating Of- • Director Certification Program (DCP)74/2006, ficer / • Director Accreditation Program (DAP)30/2004; Authorized signatory directors Thai Institute of Directors(IOD)

12 Ms. Sirirat Wongwattana 49 • M.A. of Science- Finance, university of Houston 0.00% 2008 - Present Director/ Executive Director& Secretary Property Perfect Public Company Limited Director / Clear lake, Texas, USA. of Executive / Asst. Chief Business Executive Director / • B.A. of Science , Economics& Business Development officer Assistant Chief Business Administration-Finance, Kasetsart University 2003-2006 Director of Investor Relation & Information Property Perfect Public Company Limited Development Officer / System Division Authorized signatory directors 2000-2003 Head of Research Research Dept. / BFIT Securities Limited / Securities 1999-2000 Sub- Marketing Director Marketing Dept./ BOA Asset Management company limited 1998-1999 Asst. Vice President Provident Fund Management Dept./ BOA Plc. 13 Mr. Pramote Rermyinde 57 • Bachelor of Laws Chulalongkorn University 1.445% 1998 – Present Company Secretary Property Perfect Public Company Limited Company Secretary • Thai Barrister-at-Law 1992 – Present Management Partnership Thammatit Law Office Group of Persons/ Law • Graduate Diploma in Business Law 1994 – 1997 Executive Director Supthamrong Finance House Co., Ltd./ Finance Thammasat University 1993 Executive Director Credit Fancier Srinakorn Co.,Ltd. / Finance • Director Certification Program(DCP) 69/2006 • Director Accreditation Program (DAP) 43/2005 Finance for Non-Finance Director; Thai Institute of Directors. 14 Mr. Vichai Singvicha 55 • MBA Kasetsat University 0.025 % 1988 – Present Executive Director / Chief Business Property Perfect Public Company Limited Executive Director • Bachelor of Laws Chulalongkorn University Development Officer Chief Business Development • Direct Certificate Program (DCP) 74/2006, Officer • Direct Accreditation Program (DAP) 54/2006 ; Thai Institute of Directors(IOD) 15 Mrs. Wanida Waiyawajamai 56 • Bachelor of Accountancy 1988 – Present Deputy Chief Operating Officer Property Perfect Public Company Limited Deputy Chief Operating Chulalongkorn University 1988 - 2007 Director /Executive Director Property Perfect Public Company Limited Officer • Director Accreditation Program (DAP) 1985 – 1988 Chief of Accounting Division / Dhananan Finance and Securities Co., Ltd./ Finance 50/2006 ; Thai Institute of Directors (IOD) Internal Audit and Planning Manager Name-Title Age Academic Qualifications Equity Rela- Career experience within the past 5 years Company / Business Type Hold- tion- ing ship Timing Designation 16 Ms. Supee Reodacha 51 • MBA Roosevelt University, USA 0.000 % 2002– Present Executive Director / Property Perfect Public Company Limited Executive Director / • Bachelor of Economic Asst. Chief Financial Officer Asst. Chief Financial Officer Thammasat University 1996 - 2000 Business Development manager Chai Talay Co., Ltd. / Hotel

17 Mr.Wongsakorn Prasitvipat 50 • MBA. Chulalongkorn University 0.034% 2008 - Present Executive Director / Property Perfect Public Company Limited Executive Director / • Bachelor of Architect Chulalongkorn University Asst. Chief operating Officer Assistant Chief Operating • Real Estate Course (RECU#10) Chulalongkorn 1993-2008 Director of Design & Project Property Perfect Public Company Limited Officer University Development Division

18 Mr.Wicharn Siriwetwarawut 50 • MBA. Chulalongkorn University 0.032% 2003 - Present Executive Director / Property Perfect Public Company Limited Executive Director / • Bachelor of Civil Engineer Chulalongkorn Asst. Chief Operating Officer Assistant Chief Operating University 1995 – 2001 Managing Director Baanpan Engineering & Holding Co., Ltd. Officer

19 Mr.Surasak 47 • MBA Thammasat University 0.126 % 2008 - Present Executive Director / Property Perfect Public Company Limited Vacharapongpreecha • Bachelor of Accountancy Thammasat University Asst. Chief Financial Officer Executive Director / Asst. • Certified Public Accountant 2005 - 2007 Executive Director / Accounting Property Perfect Public Company Limited Chief Financial Officer Division Director 1993 - 2004 Executive Director / Deputy Accounting Property Perfect Public Company Limited Division Director

20 Mr.Tongchai Peyasantiwong 47 MBA Edgewood Collage, Madison, Wisconsin, USA. 0.00% 2002-Present Executive Director / Property Perfect Public Company Limited Executive Director / Asst. Chief Operating Officer ANNUAL REPORT 2010 Assistant Chief Operating 2001-2001 Area Director Interlife John Hancock Assurance Public Co., ltd. Officer PROPERTY PERFECT Note No.11 Mr.Pairat Senachak Appointed as Advisors to the chief Executive Officer on 1 January 2011 No. 12 Ms.Sirirat Wongwattana Appointed as Deputy Chief Supporting Officer on 1 January 2011 No 14 Mr. Vichai Singvicha Appointed as Advisors to the chief Executive Officer on 1 January 2011 No.15 Mrs. Wanida Waiyawajamai Appointed as Advisors to the chief Executive Officer on 1 January 2011 No. 16 Ms. Supee Reodacha Appointed as Deputy Chief Financial Officer on 1 January 2011 No. 17 Mr.Wongsakorn Prasitvipat Appointed as an Deputy Chief Business Development Officer on 1 January 2010 No. 18 Mr.Wicharn Siriwetwarawut Appointed as Deputy Chief Operating Officer 1 on 1 January 20] 69 Details of Directors

Details of directors, executive directors and directors of Property Perfect Plc., subsidiary com- pany and affiliates as of 31 December 2010.

Subsidiary Company ‘ s Associated Other name Company Subsidiary Company Company Company Center Name PF PSS ESTPF Bright Point Residence KL REAL 1. Dr.Tawatchai Nakhata X, XX 2. Mr. Chainid Ngow-Sirimanee /, //, /// / / / / 3. Mr. Virayuk Puntupetch *, / 4. Mr. Phairat Senachack /, //, /// / 5. Dr. Somsak Toruksa *, / 6. Dr. Thamnoon Ananthothai *, / 7. Mr. Vidhya Nativivat / 8. Mr. David Bryce Van Oppen / 9. Ms. Sirirat Wongwattana /, //, /// 10. Mr. Ooi Boon Aun / 11. Mrs. Nuanual Swasdikula-Na- *, / Ayudhaya 12. Mr.Krish Follett *, / 13. Mr. Pramote Rermyindee @ / / / 14. Mr. Vichai Singvicha //, /// 15. Mrs.Wanida Waiyawajamai /// 16.Miss. Supee Reodacha //, /// 17. Mr.Surasak Vacharapongprecha //, /// 18. Mr.Wicharn Siriwetwarawut //, /// / / 19.Mr.Pornswat Katechulasriroj // /, /// / 20. Mr.Wongsakorn Prasitvipat //, /// 21. Mr.Tongchai Peyasantiwong // /

Note : 1. PF = Property Perfect Plc. PSS = Perfect Sportclub Co., Ltd. (Formerly: Perfect Seattleite Services Company Limited) ESTPF = Estate Perfect Company Limited Bright = Bright Development Bangkok Company Limited Center Point = Center Point Shopping Mall Company Limited Residence = Residence Number Nine Co., Ltd. KL = Krungthep Land Public Company Limited REAL = Real Service Company Limited (REAL cease operations)

2. X = Chairman XX = Chief Executive Director * = Independent Director / = Director // = Executive Director /// = Executive @ = Company Secretary

70 PROPERTY PERFECT ANNUAL REPORT 2010 Executives’ remuneration

Financial benefits Meeting allowances and director fees paid out by the company in 2009and 2010 are as follows: A) Director remuneration in 2009 - 2010 ( Unit: Million Baht) 2010 2009 Name Position Meeting Meeting Allowance Pension Allowance Pension Dr.Tawatchai Nakhata Chairman / 0.500 1.100 0.650 2.336 Chief Executive Director Dr. Somsak Toruksa* Director / 0.460 0.550 0.570 1.168 Audit Committee / Chairman of the nominating committee Dr. Thamnoon Ananthothai * Director / Audit committee / 0.700 0.550 0.740 1.168 Risk Management committee Mr. Chainid Ngow-Sirimanee Chief Executive Officer 0.250 0.550 0.300 1.168 and Deputy Chief Executive Director Dr. Theerachon Manomaiphibul ** Director - - - 1.168 Mr. Phairat Senachak Director / Executive Director 0.250 0.550 0.330 1.168 Mr. Vidhya Nativivat Director / 0.250 0.550 0.700 1.168 Nominating committee / Remuneration committee Mr.Virayuk Puntupetch * Deputy Chairman / Chairman 0.420 0.550 0.700 1.168 of Remuneration committee Miss Sirirat Wongwattana Director / Executive Director 0.250 0.550 0.300 1.168 Mr.David Bryce Van Oppen Director 0.200 0.550 0.300 1.168 Mr.Ooi Boon Aun Director 0.250 0.550 0.300 1.168 Mrs.Nuanual Swasdikula-Na- Director/ 0.650 0.550 0.450 - Ayudhaya * Nominating committee / Chairman of Risk Management Committee Mr.Krish Follett * Director/ 0.40 - - - Chairman of Audit committee / Remuneration committee Mr.Pramote Rermyindee Company Secretary - 0.200 - - Ms. Supee Reodacha *** Risk Management Committee - - 0.025 - Mr.Surasak Vacharapongpre- Risk Management Committee - - 0.025 - echa *** Mr. Boonliam Luangnakthongdee Risk Management Committee 0.240 - 0.170 - Mr.Chirdsak Kukiattinun Risk Management Committee 0.40 - 0.120 - Dr. Theerathorn Tharachai Secretary of Risk Management - - 0.025 - Committee Miss.Somsri Kiattirarat Assistance company secretary - 0.200 - 0.484 Total 5.060 7.000 5.335 14.500

ANNUAL REPORT 2010 PROPERTY PERFECT 71 Note (Some directors, aside from meeting allowance, are receiving salaries as executives and members of the Executive Board)

* Independent Director ** Resigned as a director on 18 January 2009 to become Bangkok deputy governor. *** No longer a member of the Risk Management Committee as of 14 May 2009, following the appointment of the new committee. B.) The remunerations for the executives in 2009-2010 . Details are as follows: Types of expenses 2010* 2009 (Bt million) (Bt million) Amount (person) 11 10 Salary 35.95 30.90 Bonus/ Others 11.45 5.50 Total 47.43 36.40

Note : * The remunerations for 11 executives in orqanization chart on 30 December 2010. C.) Other payments - None

72 PROPERTY PERFECT ANNUAL REPORT 2010 Corporate Governance

The Board of Directors recognized the value of good corporate governance, in enhancing transparency, the company’s competitiveness, trust from shareholders, investors and other stakeholders, and the long-term business merits. Stakeholders and society’s benefits were taken into account. The company has followed through the 5 sections of corporate governance practices as prescribed by the Stock Exchange of Thailand.

Section 1: Shareholders’ rights The Board of Directors emphasized shareholders’ rights and ensured equitable treatment to all, as prescribed in the company’s rules and regulations and relevant laws. Shareholders hold the rights to attend annual meetings, the rights to appoint their proxy to vote at the meetings, the rights to vote on the appointment or removal of individual directors, the rights to cast votes in significant matters, the rights to dividend, the rights to raise opinions and questions at the meetings, and the rights to sufficient and timely information.

The Board sets the annual shareholder meeting (AGM) once a year, within 4 months after the end of each accounting year. If necessary, an extraordinary shareholder meeting will be called where share- holders can vote on issues which could affect their interests, or legal issues which need shareholders’ approval.

In organizing the AGM, the Board puts forward the shareholders’ rights. Invitation containing agenda in details and the Board’s opinions was dispatched at least 15 days prior to the meeting date, with the proxy form, the list of independent directors and proxy advice. With timely information, shareholders can make decisions prior to the meeting date or could appoint independent directors as their proxy. The AGM was published in daily newspapers for at least 3 consecutive days and at least 3 days ahead of the meeting. The meeting details and agenda were also posted on the company’s website 30 days before the meeting, so that shareholders or investors can submit their questions in advance.

During the meeting, the Board facilitates shareholders’ attendance and voting, and refrains from any actions which will limit their attendance. All shareholders are given full freedom to raise their questions and opinions.

Section 2: Equitable Treatment to Shareholders The company values equitable shareholder treatment. Shareholders’ rights are covered in the corporate governance policy and all are treated in a fair manner through these measures: • The process to organize AGM is transparent and efficient, in line with the company’s rules and regulations and relevant laws. Shareholders are given fair chance to raise opinions and questions, with sufficient time allocation. • Shareholders are asked to review and vote on directors on the individual basis, and to approve the directors’ remuneration, auditor’s appointment, auditor fee and other agenda as described in the meeting invitation. • Ballots are issued for all agenda. • Shareholders-cum-executives are barred from proposing extra agenda without notifying others in advance, so that all shareholders have sufficient time in reviewing details of each agenda.

ANNUAL REPORT 2010 PROPERTY PERFECT 73 • Shareholders who cannot attend the meeting can appoint independent directors or other persons as their proxy, who will cast votes on behalf of them. The company’s proxy form is designed to allow shareholders to state their voting opinions. • The meeting is thoroughly recorded. The meeting minutes contain all significant information like the resolutions and votes, questions, explanations and opinions raised. • Measures against insider trading among directors and executives are in place. All must report their shareholding, as well as the holdings of spouses and under-aged children. They must report on any change in the shareholdings, after acquisition, disposal or transfer, to the Securities and Exchange Commission under the Securities and Exchange Act BE2535’s Article 59, within 3 days after the acquisition, disposal or transfer. • In place are the measures and procedure in approving transactions with possible conflict of interest or connected transactions, with full compliance with the Stock Exchange of Thailand’s regulations on connected transactions, for the equitable benefits of shareholders. Moreover, the Audit Committee also thoroughly screened connected transactions and transactions with possible conflict of interest, before submission to the Board, as required by the SET.

Section 3: Stakeholders’ rights The company realizes the significance of all stakeholders - shareholders, employees, customers, competitors, creditors (suppliers and contractors), relevant government agencies, society and environment. The policies are geared towards fairness to all groups of stakeholders Shareholders The company is concerned about transparency in important information disclosure to all shareholders accurately, completely and timely through channels including the SET’s electronic media, the company’s website, announcement in newspapers, press releases and written notices. Employees The company, through the Remuneration Committee, provides the appropriate pay structure for employees, as well as the systematic promotion process for fairness to all. A manual is issued to all employees, notifying them all of eligible welfares. The provident fund is in place for all employees. Customers The company has determined to not only quality construction but also code of conducts by taking care and responsible for customers, offering quality and standard services, and solving customer complaints or providing advices as the earliest. Competitors The company has adhered to good competition rules and avoided dishonest practices to destroy competitors. Creditors Product distributors The company has a clear period for placing invoice and check payment after handing over/inspecting works, informs contractors before they are hired and proceed payment to be in line with regulations strictly to ensure confidence of creditors. Contractors The company has a criteria for contractor selection to have efficient contractors and offer them equal opportunity. The company has set fair price as the reference. Even though prices of some items are greater than agreed prices, the company can maintain the average price on par with the market price. Occasionally, the company has taken degree of difficulty of working condition into account for pricing and authorised each hiring sub-committee to consider the matter properly based on objectives

74 PROPERTY PERFECT ANNUAL REPORT 2010 and success in transparent procurement. To ensure contractors’ confidence and let them growth along with the company, the company has stated the clear construction progress and fair construction payment installment, inspection, and invoice placing in agreements with contractors for equal treatment, and set payment period in compliance with the company’s regulations. Society and environment The company is aware of quality of life and living in society, Thai culture, and environment as substantial matters for the company’s land development. Designs for all projects not only comply with the Land Appropriation Act and regulations of related agencies but also are concerned about living quality in society after the project development. This fact is highlighted from greater space for the public areas than required by law to make project perfect with lush trees, place of exercise, and sport field for residents.

The company also undertakes the following corporate social responsibility programs. • On Buddhism, the company is hosting ceremonies at all projects so that residents can offer alms to monks, and hosting religious ceremonies on different occasions. • On cultural campaign, the company promotes cultural events such as the Thai classical dance contest for the youth, and events to celebrate major festivals like Songkran and Loy Krathong, etc. • On sports promotion, the company arranges tournaments on futsol, tennis, badminton, swimming and others at Club House, aside from the provision of financial supports and prizes. • On promoting professional skills, the company hosts a photography contest. • The company was the center in mobilizing financial to the flood victims in the Northest and the South late last year. It also made donations. Financial supports are also granted for educational institutions’ educational and sport activities.

Section 4: Information Disclosure and Transparency The Board puts emphasis on information disclosure and transparency, with sufficient information released to all stakeholders and measures to ensure the disclosure of accurate, complete and credible information in a timely manner for equal access.

Key financial information is sufficiently disclosed in the financial statements, in line with the regulations. They are disclosed via the SET system and the company’s website. The financial statements are reviewed/ audited, with unconditional opinions from the auditor and the Board’s approval before the release to shareholders. The Board also expresses its responsibility for the financial statements in the annual report.

The company discloses significant financial and non-financial information through the SET system and the company’s website, for accurate, complete, equitable, fair, transparent and timely dissemination to the general public. The Investors Relations and Information Technology Unit is in charge of the dissemination and communicate with local and foreign shareholders, investors, stock analysts accurately, equitably and timely. Investors can contact the Investor Relations Unit for the company’s information at Tel: 0-2247-7500, Fax: 0-2247-7399, e-mail: [email protected], or www.pf.co.th/ir.

The Board discloses its role and scope of responsibility as well as those of sub-committees, as well as the number of meetings each director attended under item “Management”. Remuneration of the directors and top executives are shown in item “Directors’ Remuneration”.

ANNUAL REPORT 2010 PROPERTY PERFECT 75 The company has pursued the Stock Exchange of Thailand’s rules and regulations governing connected transactions or acquisition and disposal of assets of listed companies, whichever is the case. Besides the company has set policies and guidelines to prohibit executives and related persons from using inside information for their own interests.

The company has regarded an importance of efficient internal control system for both executives and operational levels. Practices of operational staff and executives are determined and clearly written. The company has set up an internal audit office to exclusively take responsible for efficient operational examination. The internal audit reports the result directly to the Audit Committee.

5. Board of Director’s Responsibility Board of directors’ structure The company has required at least 3 independent directors in the Board of directors. At present, the company’s Board of Directors contains 12 experienced, knowledgeable and competent members as follows : - Executive director 4 persons - Non-executive director 3 persons - Independent director 5 persons

The chairman does not serve as the CEO, to segregate their supervisory and executive roles. All directors possess full independence in giving opinions.

Much emphasis is placed on the opinions of the independent directors. In any issue that draws any suggestions or disagreement from independent directors will be reviewed for transparency.

The Board abides by the minimum requirements of the SEC and SET in formulating independent directors criteria. 1. They must hold no more than 1% of all voting shares in the company, subsidiaries, affiliates, or in the companies which are major shareholders or have controlling power over the company. The shareholding includes that of those related to the particular independent director. 2. They must not have been or are not involved in the management, or employees, wage earners, or advisors on the payroll, or controlling persons of the company, its subsidiaries, affiliates, or equivalent companies, or juristic persons now and at least 2 years before their appointment as independent directors. Former civil servants for advisors of government agencies which are major shareholders or controlling persons are not included. 3. They are not related by blood or registration as parents, spouses, siblings, or children, spouses of any of the children to members of the management, major shareholders, those exercising control, or those about to be nominated as members of the management or controlling entities over the company or subsidiaries. 4. Have absolutely no vested interests in the company, its subsidiaries, affiliates, or major shareholders or controlling entities of the company, which could obstruct their independent judgment. They are not either a significant shareholder or a controlling shareholder who has business relationship with the company, subsidiaries, affiliates now and at least 2 years before their appointment. 5. They do not serve as the auditor of the company, subsidiaries, affiliates, the parent company, or controlling entities, or a significant shareholder (with over 10 per cent of voting shares including

76 PROPERTY PERFECT ANNUAL REPORT 2010 connected persons’) of the company, controlling entities, or a partner of the audit firm of which auditors perform their jobs on the company, subsidiaries, affiliates, the parent companies or controlling entities at least 2 years before their appointment 6. They do not serve as a professional service provider, including legal or financial services of which fees more than Baht2 million per year are levied on the company, subsidiaries, affiliates, the parent company, or controlling entities, or a significant, controlling shareholder or a partner of the professional service provider at least 2 years before their appointment. 7. They are not appointed to represent the directors of the company, major shareholders, or shareholders who are related to major shareholders. 8. They do not operate a company with the similar nature to and significant competition with the company, subsidiaries or affiliates, or hold a significant ownership in a partnership or act as a director with management power, employees, wage earners and advisor on payroll, or hold over 1% of voting shares of other companies which operate in the same industry or present significant competition against the company or subsidiaries. 9. Have no other characteristics that could bar the expression of their free views on the company’s operations. Sub-Committees The Board has appointed directors accordingly to their credentials to support the supervisory role and enhance supervisory efficiency. Five sub-committees are established with clear role and scope of responsibility. 1. Audit Committee 2. Executive Board 3. Nominating Committee for directors 4. Remuneration and Human Resources Committee 5. Risk Management Committee

The five sub-committees carry out their tasks in a transparent manner. Details of their names and scope of responsibility are included in item “Management Structure”. Responsibilities of the Board of Directors The Board consists of knowledgeable, capable, skilled and experienced persons who realize their roles and responsibilities, which resulted in efficient operations. The Board takes part in formulating the vision, mission, strategies, goals, business plans and resource allocation, to ensure the management’s efficient and effective implementation.

The Board values good corporate governance, to enhance transparency and the company’s competitiveness. To instill trust among shareholders, investors and all stakeholders, there is the written corporate governance policy which is reviewed once a year to fit the environment, business direction and international standards. The Code of Conduct is in place so that employees perform in accordance with the corporate governance policy.

To prevent conflicts of interest or connected transactions, the Board assigned sub-committees with clear segregation of roles. There are policies, code of practices and the procedure to approve transactions which might carry conflict of interest, as guidelines to executives, employees and relevant parties. Such cover the criteria in endorsing connected transactions, the use of inside information and information disclosure. The Board also demands the management to regularly assess business risks and formulate risk preventing and

ANNUAL REPORT 2010 PROPERTY PERFECT 77 mitigation measures, and report them to the Board. These include the risks that may affect the company’s performance, as specified in item “Risk Factors”. Board Meetings The Board holds quarterly meetings, aside from extra meetings as necessary, with clear and prepared agenda, to review the quarterly results as well as monitor progress. The chairman and CEO will jointly review the issues, before brining them up to the Board’s meetings. Each director is allowed to propose their own agenda.

In each meeting, the chairman allocates sufficient and ample time for discussion. Meeting minutes are written and the minutes, approved by the Board, are stored for inspection by the Board and relevant parties. Board of Directors' self assessment Executive directors conduct a quarterly evaluation to assess performance in part of their responsibility and the performance evaluation is presented to the company's Board of Directors to compare with performance in the past. Remuneration The company has appointed the Remuneration and Human Resource Committee to consider remuneration principles and policies for Chief Executive Officer, directors and advisors and determine bonus, salary adjustment annually and during the year, and other benefits to staff in each level. Remuneration determination is based on experience, duty and scope of responsibility, and compare with other companies in the same industry (see details in heading remuneration of directors and management). Directors and Management improvement The company is concerned about the importance of Directors and Management improvement for management succession in the future. The company is aware of the importance of human resources in management level by organizing training "Real Estate Business Management", contents of which include real estate knowledge, law, finance, accounting and good corporate governance to prepare the company's high-level executives for being directors in the future. For the company’s directors, they participated in trainings held by Thai Institute of Directors and aimed to develop and support directors to take practices of good corporate governance in organization. Surveillance on use of inside information

The company has policy to prohibit directors and management from directly and indirectly using inside information for their own benefits. Directors, management and employees who learn about the company's financial information must not exploit the information one month before announcement of such information to the public. The company informs directors, management and staff mentioned above to avoid trading the company's securities before the financial statements are disclosed to the public. It also explains directors and management about duties in reporting their holding and change in holding in the company’s securities to the SEC as stipulated in article 59 and punishment in article 275 of the Securities and Exchange Act B.E 2535.

The company has also stipulated discipline penalty for the company's staff who breach the company's rules and regulations or announcement as stated in rules and regulations governing staff’s operating practices.

78 PROPERTY PERFECT ANNUAL REPORT 2010 Internal Control

At the meeting No. 1/2011 on 25 February 2011, the Board of Directors resolved on the appropriateness and sufficiency of the internal control as follows; 1. Control environment The company’s environment and organizational structure is conducive for the planned internal control system. The company possesses a clear business plan and a concrete assessment system. The annual business plan approved by the Board exists, as guidelines for the management and employees to achieve the goal. The control environment also promotes efficient internal control, which will lead the management towards the goal. 2. Risk management The Board establishes a risk management committee to oversee and formulate risk framework for holistic organizational management, as well as ensure the Board’s efficient operations in that area. Under prescribed budgets, the company sets clear organizational objectives and assesses internal and external factors which could steer it away from business goals. There is an analysis on possible causes of risks and measures to deal with them. 3. Control Activity The internal control and evaluation are segregate for cross examination. The scope of duty and the amount of money each can endorse is clearly specified. The appropriate internal control is placed on the management, and the Board also reviews the management's performance and approves transactions between the company and major shareholders, directors, executives or individuals related. The transactions are treated similarly to those struck with outsiders. The Board also reviews and approves the annual audit, so that significant and high-risk activities are covered to ensure the company’s goal achievement. 4. Information and Communications System The company has continually improved the information and communications system, with sufficient information to support the Board and management's decision-making process. Before meetings, directors duly receive sufficient and clear information, with appropriate time slot for reviewing. Board of Directors' meeting minutes contain directors' questions, remarks and opinions, and all are documented. The accounting procedure is also in compliance with the generally-accepted standards and appropriate to the nature of business. 5. Monitoring and Evaluation The company has monitored and evaluated the performance. Business procedures are properly drawn up, to ensure the continuity in internal control. The procedures become part of the normal functions of executives and relevant persons. The company has outlined the constant monitoring and evaluation plans, to ensure achievements in specified periods. The internal control unit reports directly to the Audit Committee and the internal control is reviewed on an annual basis. Regarding the company's 2010 financial statements, the auditor did not point any significant flaws in the internal control which may cause damage to the company.

ANNUAL REPORT 2010 PROPERTY PERFECT 79 Human Resources Number of staffs At the end of 2009 and 2010, the company and subsidiaries employed 460 and 505 employees, respectively. The employees tend the following departments.

Department Number of staffs Number of staffs 31-Dec-10 31-Dec-09 1 Office of the Chief Executive Officer 11 11 2 Project Planning Division 18 18 3 Design Division 15 17 4 Construction Management Division 13 14 5 Product Development & Quality Control Division 8 9 6 Advertising Division 12 13 7 Public Relations and Corporate Communication Division 5 5 8 Accounting Division 12 13 9 Internal Audit office 3 3 10 Legal Procedure & Ownership Transfer Division 45 41 11 Sales Management Division 35 29 12 Finance & Treasury Division 17 14 13 Budgeting Office 5 3 14 Investor Relation & Information System Division 9 8 15 Real Estate Business Developnehty Division 8 5 16 Research & Business Development Division 4 4 17 Human Resources Division 7 6 18 General Administration Division 20 21 19 Project Management Division Zone 1 - 5 260 227 Total 505 460 The company over the past 3 years did not have any legal case about labor dispute.

Employee Remuneration The Remuneration and Human Resource Committee is in charge of formulating the remuneration policy and criteria for CEO, directors and advisors of the company. It fixes the annual pay, annual pay adjustment, interim pay adjustment, and other rewards to employees in all levels. It also takes care of the employment policy and ensures appropriate and fair penalties on employees.

80 PROPERTY PERFECT ANNUAL REPORT 2010 The company’s employee remuneration (excluding executives’ remuneration) consists of salary, bonus, welfares, overtime, allowances and contribution to the provident fund. At the end of 2009 and 2010, the remuneration stood at Bt236.7million and Bt326.71million, respectively.

Human resource development policy The company places emphasis on human resource development. Through the HR development policy, the company demonstrates its dedication in enhancing employees’ value. Learning programs are created internally, to promote their knowledge and capability so that they can perform duty efficiently and lead the company towards quality product development for society.

ANNUAL REPORT 2010 PROPERTY PERFECT 81 Reference

Auditors Mr.Tippawan Nananuwat Miss Siriporn Aueanankul Mr.Kritsada Lertwana Ernst & Young Office Limited 33rdFloor, Lake Rajada Office Complex 193/136-137 New Rajadapisek Road, Bangkok 10110 Tel. 0-2264-0777, 0-2661-6190 Fax. 0-2264-0790, 0-2661-9192

Legal Advisor Banchong and Vidhya Law Office 33/35, 33/39-40 Wallstreet Tower 9th Flr. Surawong Road, Kwaeng Suriyawongse ,Bangrak, Bangkok 10500 Tel. 0 2236-2334 Fax. 0 2236-3916

Share Registrar Thailand Securities Depository Co., Ltd. 4th , 6th -7th Flr. ,The Stock Exchange of Thailand Bldg., 62 Ratchadaphisek Road, Klongtoey ,Bangkok 10110 Tel. 0-2359-1200 -1 Fax. 0-2359-1259

Property Valuation Agency for real estate affairs Co., Ltd . 10 Nonsi Rd., Nonsi, Yannawa, Bangkok 10120 Tel.0-2295-3905 Fax. 0-2295-1154

Brooke Real Estate Limited Unit 2005-6, The Millennia Tower 20th Fl., 62 Langsuan Road, Lumpini, Pathumwan, Bangkok 10330 Tel. 0-2652-6300 Fax.0-2652-6399

Thai Property Appraisal Lynn Phillips Co., Ltd. 121/47-48 RS Tower Building, 11th Floor, Rachadaphisek Rd., Dindaeng, Bangkok 10320 Tel : 0-2641-2128-32 Fax : 0-2641-2134

82 PROPERTY PERFECT ANNUAL REPORT 2010 Connected Transactions with Related Persons

1. Connected transactions with Estate Perfect Co., Ltd (“Estate”)

Relationship • Property Perfect is major shareholder of Estate, holding 100% stake. • Property Perfect and Estate share 1 director – Mr. Chainid Ngow-Sirimanee. • The company’s executives who Estate’s director are Mr. Pramote Rermyindee, Mr. Pornsawat Katechulasriroj and Mr. Nantachart Kliebphipat are Details of transactions 2010 (Unit : Million Description Baht) Note Loan Loan to subsidiary/ 460.98 Property Perfect loaned to Estate which issued promissory Interest income 24.59 notes in return for partial loan disbursement. The PN carried Accrued interest 13.02 0.75-1 percentage point on top of Property Perfect’s weighted average financial cost. On 25 February 2011, the audit committee’s meeting resolved Property Perfect to provide additional credit line of Bt450 million to Estate for land purchase and project development, Charging 0.25 percentage point above average financial cost. Land sale Sale revenue 14.87 The company sold 0-2-12.2 rai on Ramkhamhaeng Road to Estate for land development and sold it the 1-0-72.1-rai land, Estate Hold right 5%, now the entry to its development project on Chaeng Wattana Road so that the land would not be registered as public property. Guarantee Credit line 2,035 Property Perfect entered into an agreement to guarantee loans from a financial institution to Estate, without premium. The guarantee’s details are as follows : Bt620 million credit line for Romklao project Bt800 million credit line for Perfect Place Sukhumvit 77 project Bt310.5 million credit line for The Villa Ram-Intra project Bt304.5 million credit line for The Villa Ramkhamheang project Audit Committee’s Opinion The loan is the necessary financial assistance for Estate’s project development and expansion as planned. In addition, Land sale is a normal business transaction and the price is jointly determined by the company and Estate. The company needs to provide the guarantee due to its 100% holding in Estate.

2. Connected transactions with Bright Development Bangkok Co., Ltd. (Bright) Relationship • Property Perfect is the major shareholder of Bright, holding a 100% stake. • Property Perfect and Bright share 1directors – Mr. Chainid Ngow- Sirimanee • The company’s executives who Bright’s directors are Pramote Roemyindee, Mr.Wicharn Siriwetwarawut and Mr.Pornswat Katechulasriroj

ANNUAL REPORT 2010 PROPERTY PERFECT 83 Details of transactions 2010 Description (Unit : Note Million Baht) Loan and ad- Loan to subsidiary/ 797.52 Property Perfect transferred advance for purchases of land vance payment Interest income 21.13 and expenses related to Ratchadapisek project to Bright Accrued interest 11.73 to comply with conditions required by financial institutions Advance payment 1.50 which loaned to Property Perfect in establishment of Bright to develop the project. Therefore, Bright was a debtor of Property Perfect. Property Perfect loaned to Bright for further project development with promissory notes represented for partial loan disbursement. charging 0.65-1.5 percentage point above average financial cost. On 25 February 2011, the Board approved a Bt650 million loan to Bright for land purchase and working capital, charging 0.25 percentage point above average financial cost.

Land sale Sale revenue 11.46 The company sold 0-1-74.6 rai land on Ramkhamhaeng Road to Bright for land development Loan Credit line 2,310 The company provided the following guarantees to Bright’s guarantee loans from a financial institution without premium. Bt870 million credit line for Metro Sky Ratchda project Bt184 million credit line for i-Condo Ngamwongwan project Bt481 million credit line for i-Condo Sukhapiban project Bt775 million credit line for i-Condo Sukhumvit 105 project

Audit Committee’s Opinion The loan is the necessary financial assistance for Bright’s project development and expansion as planned. Land sale is a normal business transaction and the price is jointly determined by the company and Bright. The company needs to provide the guarantee due to its 100% holding in Bright. 3. Connected transactions between the company and Residence Number Nine Co., Ltd. (Residence) Relationship: • The company is a major shareholder of Residence with a 100% ownership. • A company executive who is Residence’s director is Mr.Wicharn Siriwetwarawut • A company’s employee who is Residence’s director is Mr.Sanpetch Sukkasem

84 PROPERTY PERFECT ANNUAL REPORT 2010 Details of transactions 2010 Description (Unit : Note Million Baht) Loan Loan to subsidiary - The company loaned to Residence, which in return Interest income 0.42 issued promissory notes for loan disbursement. Accrued interest - The PN carries 0.65-1 percentage point above the company’s weighted average financial cost. Land sale Land sale 5.00 The company bought road space in Residence’s Bang Buathong project, covering 1-1-78.3 rai to limit access to outsiders. Loan guarantee Amount 930 The company guarantees the following loans to Residence from a financial institution, without premium. Bt670 million credit line for Perfect Park Bang Buathong project Bt260 million credit line for The Villa Bang Buathong project

Audit Committee’s opinion The loan is the necessary financial assistance for Residence’s project development and expan- sion as planned. Land purchase is necessary to limit outside access to the project of Residence which is a wholly-owned subsidiary, as Residence could not claim ownership in the land and could not sell the land to others. The company also needs to provide the loan guarantee due to its 100% shareholding in Residence. 4.) Connected transactions between the company and Perfect Sport Club Co., Ltd. (Formerly Perfect Satellite Services) Relationship • Property Perfect is the major shareholder of Perfect Sport Club, holding a 99.98% stake. • The company’s executives who Perfect Sport Club’s directors are Mr. Phairat Senachak and Mr. Mr.Tongchai Peyasantiwong • The company’s employees who Perfect Sport Club’s directors are Ms .Rassamee Metavikul and Mr.Krittapas pongpakkavat

ANNUAL REPORT 2010 PROPERTY PERFECT 85 Details of transactions 2010 (Unit : Description Million Note Baht) Contracted to Expenses 12.77 Property Perfect hired Perfect Sport club Co., Ltd. to manage club houses manage club houses and golf courses in the company’s projects as follows : -Club house management fee was charged at Bt90,000- Creditor 1.39 138,000/project -Golf course management fee was charged at Bt50,000/ project and Perfect Sport club Co., Ltd. charged service fee on providing service staff at the actual expenses.

Audit Committee’s Opinion The transaction is a normal course of business transaction whereby both companies jointly set the price.

5. Connected transactions between Centrepoint Shopping Mall Co., Ltd. (Centre Point) Relationship: • Property Perfect is the major shareholder of Centre Point, holding a 100% stake. • Property Perfect and Centre Point share 1 director – Mr. Chainid Ngow-Sirimanee.

Details of transactions 2010 Description (Unit : Note Million Baht) Loan Loan to a subsidiary 24.43 The company loaned to Centre Point which in return Interest income 0.92 issued promissory notes as partial loan disbursement. Accrued interest 0.36 The PN carries the interest of 1-1.5 percentage point of the company’s weighted average financial cost. Leasehold rights Income from leasehold 65 On 2007, the company struck an agreement to transfer transfer rights sale leasehold rights to Centre Point at the cost of Bt200 million, and received Bt80 million as a deposit. The contract was amended involving the payment of the remaining amount. In 2010, the Board approved the cancellation of the leasehold rights transfer and the return of the Bt80 million deposit to Centre Point’s directors. The Board approved the transfer at the cost of Bt65 million. The leasehold rights was transferred.

Audit Committee’s Opinion The loan is the necessary financial assistance for Centre Point’s project development and expansion as planned. The leasehold rights transfer contract is a normal business transaction and the company as well as Centre Point jointly set the price.

86 PROPERTY PERFECT ANNUAL REPORT 2010 Risk Factors

Factors that could lead to risks to investors and the issuer are as follows: 1. Risk on liquidity and funding access

The company has operated in the industry for more than 25 years. Thanks to executives who had survived economic crises, we foresee obstacles and therefore adopt cautious development strategies. The company has emphasized on transparent operations, being careful throughout the process from the selection of locations and land purchases. Project feasibility study is carried out, with focus on all details. The results are submitted to the executive board for the 360-degree approval process. The company has so far won trust and supports from financial institutions for both project finance as a premium client and mortgage loans for individual buyers. In raising funds, the company also resorts to equity and debt instruments, like promissory notes, bill of exchange, debentures and unsubordinated convertible debentures which could reduce the financial cost and allow flexible repayment periods. These are possible due to continued supports from financial institutions.

At the end of 2010, the company and subsidiaries issued 6 series of secured and unsecured debentures with combined value of Bt6,578 million. Debentures with maturity within 1 year are valued at Bt800 million while those due between 2012-2013 total Bt5,778 million. (Details appear in Note to Financial Statements No.21)

The company has reviewed and put emphasis on controlling the debt to equity ratio. The ratio will be maintained at no more than 2:1. in line with the latest stipulation on bond is suers and bond holders’ rights and duties in 2010. Consolidated liabilities as of 31 December 2010 amounted to Bt12, 554 million, including shareholders’ capital at Bt7,174 million. Cash and cash equivalents are valued at Bt2,017 million, debt to equity ratio at 1.46:1 while operating cash flow at Bt1,066 million. The company has the confidence that thanks to the track record, it will further win premium financial supports from local financial institutions. This will keep risks on funding access and liquidity shortage at the low level.

2. Risk from demand for higher working capital to finance housing development and debt repayment

The company has maintained the policy to sell completed houses, to meet demand and convince consumers of scheduled delivery. The policy requires higher working capital to complete the houses, and the company addresses the issue by selling the houses while the construction works take place. The number of houses under construction is also kept at an appropriate level, based on the average sale figures (moving average). In several projects, demand outpaces supply and to satisfy customers, the company allows them to place reservations for the under-construction units. The company has started sale of under-construction units in high-potential projects and won warm response thanks to consumers' trust in getting complete units on schedule. This helps narrow the risk in finding working capital, to kick off the presale of new projects. Financial institutions consequently approve project financing on confidence that the projects with some advance sales lower the risks in finding customers. The policy to focus on selling completed houses raised the consolidated revenue in 2010 by Bt2,756.07 million, or 46.33% from 2009.

ANNUAL REPORT 2010 PROPERTY PERFECT 87 The company has also applied prefabrication as well as the rigid frame or skeleton technology to reduce the construction period and demand for skilled labor. The construction period is shortened to 4-5 months, allowing efficient inventory management. In 2011, the company plans to expand the number of prefab houses with increasing demand. Sale revenue is collected from different projects that require different periods in development and sale, the company ably manages the cash flow. It also bucks any risk by tapping additional funds from financial institutions. As of 31 December 2011, the company and subsidiaries were able to withdraw Bt2,433million under long-term financing contracts(Details appear in Note to Financial Statements No.24). The company also puts into place the system to monitor sale and construction orders, to ensure the balance in the number of complete houses or inventories and marketing campaigns.

3. Risk from construction cost volatility

The volatile oil prices directly buoyed the prices of construction materials, and pushed up the operating cost in the property and construction industries. The company has emphasized on reducing the volatility in the prices of construction materials, which are the main component of the construction cost, through direct and indirect strategies. Direct strategies: The company upholds the policy for advance procurement of major materials like piles and strengthened steel, at least 6-12 months, to reduce the volatility. Contractors also help in negotiating for the prices of other materials, allowing higher bargaining power to the company in negotiating for a lower price and delivery schedules. The company partnered with SCG Building Materials Co,, Ltd, a subsidiary of Siam Cement Public Company Limited, in introducing the supply chain management system to manage the construction works and lower the construction cost in the long term. Indirect Strategies: Shifting focus to complete house development rather than building on orders allows the company to manage the construction plans. This boosts the company's price negotiation power and ability to control the cost to some extent. The company learns in advance the total cost, before putting units on sale. This helps increase the cost management efficiency to some extent, and reduce volatility on the construction cost.

4. Risk from the shortage of contractors

The company realized the importance of connection with contractors. The construction works assigned to each contractor is appropriately and constantly rationed, taking into account their readiness in terms of labor and financial capacity. The company also opens door wide for new contractors, to cope with growing projects.

Fair construction cost pricing, disbursement on completion levels, and assurance that foremen and the company's engineers work together in the harmonious environment lead to standard and quality works. The company introduced the Site Management system to standardize the construction quality at all projects. The system will raise contractors' trust in the company and encourage them to grow together.

Cooperative environment between contractors and the company will keep the risk from contractor shortage at the low level.

88 PROPERTY PERFECT ANNUAL REPORT 2010 5. Risk from higher competition in the residential market

The company has emphasized its strategies on products and locations to meet the economic conditions and a significant increase in oil prices. New products as condominiums and townhouses priced Bt1.2-Bt2 million are launched to serve consumer demand. Products are characterized by brands, to meet different consumer demands. All locations are located near existing and future mass transit routes, to serve all consumer segments.

At all projects, the company has invested hugely to ensure a convenient lifestyle, with green parks and lakes for family leisure activities under the “Happy Living” concept. Excellent environment conditions allowed the company to win the EIA Monitoring Awards for four consecutive years (2005-2008) and in 2008 the company won 10 energy-saving home designs from the Energy Ministry’s Alternative Energy Development and Efficiency Department’s award, for 7 designs in 3 projects.

The company is confident that new projects at various locations will boost market shares in each segment, thanks to the extensive business experience and reputation which would significantly reduce risk from higher competition.

6. Risk from guarantees to subsidiaries

Estate Perfect Company Limited (Estate), the wholly-owned subsidiary with registered and paid-up capital of Bt1,200 million, develops 5 projects of single houses and townhouses. The outstanding value of all projects is now Bt4,029million. The company guarantees Bt2,035 million bank loan to Estate, without charging any fee. (Detail in “Connected Transaction”) Estate has so far achieved its business goals.

Bright Development Bangkok Company Limited, the wholly-owned subsidiary with registered and paid-up capital of Bt500 million, develops 4 condominium projects namely Metro Sky Ratchada and i-Condo worth totally Bt5,108million. The company guarantees Bt2,310 million loan, without charging any fee. (Detail in “Connected Transaction”) Sale of all four projects is underway and has secured warm response.

Residence Number Nine Company Limited (Residence), the wholly-owned subsidiary with registered and paid-up capital of Bt1,000 million, develops two single house and townhouse projects in Bang Buathong area worth totally Bt2,158.44 million. The company guarantees Bt930 million loan to Residence, without charging any fee. Residence’s projects are located in potential locations and have drawn good response.

Loan guarantees to all three subsidiaries are normal financial assistance in line with the shareholding ratios, considered essential for the subsidiaries’ operations which have been thoroughly planned like all projects carried out by the company. Risk from these projects is equivalent to risk to the company.

7 Risk from economic volatility and political situation

Economic conditions send a direct impact on the property industry. Realizing the possible significant impacts from economic and political situations, the company has formulated plans and strategies to cope with the economic condition. The company has been thorough in launching projects, land acquisition and cash flow management. Construction volume of each project is closely monitored, to keep inventory at

ANNUAL REPORT 2010 PROPERTY PERFECT 89 the appropriate level and in line with sale progress. In launching new projects, the company takes into account political risks as well as direct and indirect economic impacts and the company promptly delays investment when necessary to reduce risks.

8 Risk from minimum return guarantee for property fund

On 28 February 2008, the company sold assets – 64 units of complete 2-storey houses with land in Perfect Masterpiece Ekamai-Ramindra and Perfect Place Ramkhamhaeng-Suvarnabhumi – to Property Perfect Fund (Fund) for a total value of Bt510 million. Upon receiving the amount, the assets were transferred to the Fund without a repurchase condition, and they were written off from the company’s assets. The Fund’s unit trusts are valued at Bt520 million. As of 30 December 2010, the company’s investment in the Fund is worth 6.54% of outstanding unit trusts. The company extended the guarantee that the Fund’s minimum return (from rents and services before expenses) would be at least Bt55 million per annum for five years, ending on 31 December 2012. (The guaranteed amount in 2008 was lower than Bt55 million, as it was the first year of the Fund. The guarantee was set accordingly to the period in the year.) A risk persists from the guarantee in the event the Fund could not achieve the targeted revenue. The company had placed a guarantee endorsed by a financial institution to the Fund. Rents tend to increase, as the number of 40 houses or 62.50% of total 64 units are rented as of 31 December 2010, against 21 or 32.81% at end-2008. Risk from the guarantee thus tends to decline.

90 PROPERTY PERFECT ANNUAL REPORT 2010 Explanation and Analysis of Financial and Operating Results

Property Perfect Public Company Limited’s consolidated financial and operating results for year 2008-2010 were as follows:

Subsidiary Establishment In 2007, the company established Bright Development Bangkok Co.,Ltd. with a registered capital of Bt1 million, for the development of Metro Park Sky Ratchada. It raised the capital to Bt500 million in March 2010. The company now holds 100 % of the registered and paid-up capital.

In 2007 , the company also established a joint venture with Singapore's Timberline Investments Pte. Ltd, a shopping complex developer. Centre Point Shopping Mall Co.,Ltd was established with a registered capital of Bt1 million, held 59.99% of the registered and paid-up capital by the company, to handle commercial develop- ment like shopping malls and office buildings. On 22 January 2010, the Board approved the company's purchase of all shares from Timberline Investments Pte. Ltd. .(amounting to 400,000 shares at Bt100 par value). After the acquisition, the company owns 100% in Centre Point. The Board also approved the plan to raise Centre Point's registered capital from Bt1 million to Bt500 million. As 30% of capital is paid up, the paid-up capital is now Bt150.7 million.

In March 2010, the company bought a 100% stake in Residence Number Nine Co., Ltd., which was capitalized at Bt1,000 million, from its shareholders at the cost of Bt507 million, to expand its residential development business.

In April 2010, Estate Perfect Co., Ltd., a wholly-owned subsidiary, raised the capital from Bt1,000 million to Bt1,200 million entirely shouldered by the company.

Performance Overview In 2007, the company showed an improvement from 2006, thanks to the new projects launched by the company and subsidiaries to meet consumer demand. In 2007, two new projects were launched, along with the new phases of 3 existing projects. In 2008, 4 new projects were launched: 1 each covering single detached houses , 1 townhouse and 2 condominiums. In 2009, 4 new projects were unveiled - 3 covering single houses and 1 townhouse and the expansion phase of an existing condominium project. In 2010, the company and subsidiaries launched 11 new projects – 3 single house projects, 3 townhouse projects, and 5 condominium projects. The outstanding projects under development are numbered 24 projects.

Consolidated Operating Results • Sales revenue The company realizes sales of land and house and condominium units as revenues in statements of income when ownership rights are transferred to buyers.

In 2008, consolidated sales revenue generated from land and houses sales amounted to Bt5,420.14 million, up Bt723.01million from 2007, partly due to the sale of 64 housing units worth Bt510 million to Property Perfect Fund. Sales of Metro Sky Park Sathorn condominium of Bt2,109.46 million also represented an increase of Bt639.97 million from 2007, as the company started transferring complete units of the second phase late 2007.

ANNUAL REPORT 2010 PROPERTY PERFECT 91 In 2009, the consolidated revenue on land and house sales totaled Bt5,073.42 million, down Bt346.72 mil- lion from 2008. Attributing to the 2008 revenue was the sale of 64 houses worth Bt510 million to Property Perfect Fund. There was no such sale in 2009. And the value of sold condominium units in Metro Park Sathorn dropped to Bt778.47 million, against Bt1,330.99 million in 2008 as the company started to transfer the units in Phase II late 2007. Transfers continued throughout 2008 and only some units were left for transfers in 2009. Units in Phase III of the project are expected to be transferred and generate revenue late 2010.

In 2010, the consolidated revenue from land and house sale totaled Bt7,002.70 million, up Bt1,929.28 million from 2009, thanks to higher sales and the higher number of projects that could generate revenue. Revenue from sale of Metro Park Sathorn project at Bt777.73 million dropped 0.74% from 2009.

The company also earned Bt835.49 million from land sale, accounting for 9.69% of sale revenue.

The consolidated sale revenue by project during 2008-2010 is available in the table showing revenue structure by product.

• Cost of sales and gross margin Calculation of costs of land and house sales and condominium units, which is the company's and subsidiaries' main cost, takes into account all project development costs that estimated to arise proportionately to land sold (and also actual costs) and the costs of sales are realized after the company books revenue from the sale of a particular unit.

The above project development costs are presented at net cost from provision of losses from a write-down in project value. The cost covers the price of land, designs, infrastructure, construction and related interest.

For 2008, consolidated cost of sales were as follows: • Cost of land and houses sales amounted to Bt3,767.92 million, up Bt470.62 million or 14.27%. Cost of sales accounted for 69.52% of the sales revenue, below 70.20% in 2007. • Cost of condominium unit sales totaled Bt1,395.41 million, rising by Bt353.82 million from the previous year or 33.97%. Cost of sales represented 66.15% of the sales revenue, down from 70.88% in 2007. • The higher cost of sales of both land and houses and condominium units resulted from higher revenue while cost of sales to sales revenue ratio fell from the previous year due to price hikes in early 2008. • Cost of land sales dropped by Bt49.99 million from the previous year to Bt6.59 million. Cost of sales accounted for 76.24% of the sales revenue, up from 56.97% in the previous year. In 2009, the consolidated sale cost is as follows; • Cost of land and house sales totaled Bt3,514.25 million, down Bt253.67 million or 6.73% from the previous year. The amount represented 69.27% of sale revenue, down from 69.52% in 2008. • Cost of condominium totaled Bt551.95 million, down Bt843.46 million or 60.44% from the previous year, or 60.44%. Sale cost accounted for 70.90% of sale revenue, which was above 66.15% in 2008.

92 PROPERTY PERFECT ANNUAL REPORT 2010 • The cost of house and land sale dropped due to lower sale revenue. Comparatively, the cost against sale revenue was not changed from the previous year. Meanwhile, the condominium sale cost raised, due to discounts on remaining units of Metro Park Sathorn Phase I and II.

In 2010, the consolidated sale cost of the company and subsidiaries was as follows: • The sale cost of land and house sale totaled Bt4,606.86 million, up Bt1,092.61 million or 31.09% from the previous year. The cost accounted for 65.79% of sale revenue, down from 69.27% in 2009. • The sale cost of condominium units totaled Bt496.70 million, down Bt55.24 million or 10.01% from the previous year. The sale cost accounted for 63.87 million of sale revenue, down from 70.90% in 2009. • The sale cost of land totaled Bt695.76 million, accounting for 83.28% of sale revenue.

In 2008, the consolidated gross margin increased, thanks to higher consolidated gross margin from land and houses and condominium units sales representing 30.48% and 33.85% respectively. The increase in consolidated gross margin could be attributed to the increase in price tags of housing in early 2008 and condominium phase 2 in late 2008.

In 2009, the consolidated gross profit margin on land and house sale slightly rose to 30.73%, while the condominium gross profit margin dropped to 29.10% due to discounts for Metro Park Sathorn Phase I and II projects.

In 2010, the consolidated gross margin from land and house sale increased from 30.73% to 34.21%, due to higher sale prices as well as the realization of revenue from projects with higher gross margin. The gross margin of condominium units also increased to 36.13% while that of land was 16.27%.

• Other revenue Most of other revenue came from utilities, Club House management fee, and confiscated down payments. During 2008 and 2010, other revenue on the consolidated basis totaled Bt79.37million, Bt95.93million and Bt87.98million, respectively. In 2009, asset disposal also raised Bt18.54 million in other revenue.

• Selling and administrative expenses In 2008, the consolidated sale and administrative cost totaled Bt1,244.10 million, up Bt12.83 million from Bt1,231.27 million in 2007 or 1.04%, thanks to the government’s measures to boost the property market. The reduction in special business tax and transfer fee from 3.3% and 2% respectively to 0.11% and 0.01%, respectively, slightly increased the total expenses.

ANNUAL REPORT 2010 PROPERTY PERFECT 93 In 2009, sale and administrative cost on the consolidated basis totaled Bt1,034.58 million, down Bt209.52 million or 16.84% from 2008. Sale cost dropped Bt136.52 million, thanks to the Bt67 million decrease in the special business tax and transfer fee. The advertising, public relations and marketing cost also dropped Bt70 million. Meanwhile, administrative cost also declined Bt77.62 million, due to more efficient expense control.

In 2010, the consolidated sale and administrative cost as well as executives’ allowances totaled Bt1,756.14 million, up Bt721.56 million or 69.74% from 2009. Sale cost increased by Bt479.41 million as the special business tax and transfer fees went up by Bt233.56 million, as the tax reduction to 0.01% was raised back to the normal level of 3.3% on 28 March 2010. The advertising, public relations and marketing expenses rose by Bt233.40 million while the administrative cost increased by Bt223.40 million. As the company was prepared to launch new projects particularly in the second half of 2010, it shouldered higher employee and management expenses as well as higher executive pays by Bt18.75 million.

• Other expenses The company in 2008 sold 64 units of land and houses with a combined value of Bt510 million to Property Perfect Fund. Under the agreement, the Company agrees to guarantee the minimum revenue of the fund (rental and service revenues before deducting expenses) at Bt55 million for a period of five years, ending 31 December 2012. However, the amount of guaranteed revenue depends on the ratio of the value of the outstanding properties to the value of the properties in which the Fund initially invested, as determined by an appraisal company for the purpose of the initial investment. The company has estimated provision for loss from such guarantee at the present value of the cash flows which it expects to pay to the fund with a total of Bt73.8 million, and recorded it as a separate item under the heading of “loss arising from minimum revenue guarantee” in the income statements for the current period ended 31 December 2008.

In 2009, the company booked Bt9.4 million losses from minimum return guarantee as expense, as the rental revenue under Property Perfect Fund was below expectation.

In 2010, the company booked Bt35.60 million losses from the minimum return guarantee as expense, which was Bt26.18 million higher from 2009.

• Financial expenses It comprises interest expenses, expenses for provision for unconverted debentures according to maturity of the unsubordinated debentures, write-off premium on debentures and financial charges.

Interest expenses during 2008 to 2010 amounted to Bt192.29million, Bt178.96million and Bt318.26million, respectively.

Expenses for provision for unconverted debentures according to maturity of the unsubordinated debentures and write-off premium on debentures between 2008 and 2010 were Bt55.25million, Bt60.47million and Bt67.60 million, respectively .

94 PROPERTY PERFECT ANNUAL REPORT 2010 Financial fees during 2008-2010 stood at Bt24.50 million, Bt47.16 million and Bt79.23 million, respectively. The amount rose sharply in 2009 and 2010 due to the increase in issued debt instruments like debentures and bill of exchange. In 2010, it also shouldered a Bt26 million cost for the early redemp- tion of some debentures. • Net profit The consolidated net profit during 2008-2010 were (Unit : Million Baht) 2010 2009 2008 Net profit 550.44 399.75 802.57

In 2008, the consolidated net profit shot up Bt390.96 million or 94.99% year-on-year to Bt802.57 million on higher land and houses and condominium units sales revenue and gross margin. Benefits from the government’s real estate stimulus measures which cut the special business tax from 3.3% to 0.11% and the transfer fee from 2% to 0.01%, and the declined interest rate in the second half of 2008 also gave a boost to the consolidated net profit.

In 2009, the consolidated net profit stood at Bt399.75 million, down Bt402.81 million or 50.19% from the previous year, due to lower sales of houses and condominium units as mentioned above. The gross profit margin consequently dropped Bt582.62 million, while sale and administrative cost and other expenses dropped Bt273.90 million on year due to greater efficiency in controlling expenses. The company also shouldered a Bt91.27 million increase in corporate tax.

In 2010, the consolidated net profit stood at Bt550.44 million, up Bt150.69 million or 37.69% from the previous year, due to the higher land and house sale as well as higher gross margin. Moreover, it earned Bt835 million from land sale. Still, sale and administrative cost as well as other expenses went up in line with business expansion.

Financial Status • Overall Picture of Financial Status Table presented consolidated financial status

(Unit :Million Baht) Assets Liabilities Shareholders’ equity As of 31 December 2010 19,728.93 12,554.50 7,174.43 As of 31 December 2009 14,476.74 7,656.65 6,820.09 As of 31 December 2008 12,932.87 6,229.64 6,703.23

Assets The consolidated assets stood at Bt12,932.87 million, Bt14,476,.74million and Bt19,728.93 million during 2008 and 2010, respectively. In 2008, the assets slightly rose Bt21.84 million or 0.17% on year, while the 2009 and 2010 assets increased Bt1,543.87 million and 5,252.19 million ,respectively. As the company acquired additional land for condominium and townhouse development.

The assets as of 31 December 2010 was constituted mainly by project development cost, of which

ANNUAL REPORT 2010 PROPERTY PERFECT 95 combined value was Bt10,123.00 million or 51.31% of total assets. That was followed by land bank worth Bt5,492.99 or 27.84%. The others were cash and cash equivalents, Bt2,017.85%; advance payment for land purchase, Bt554.64 million; and investment in affiliated companies, Bt477.62 million which accounted for 10.23%, 2.81% and 2.42%, of total assets respectively. The structure was in line with the nature of business of the company and subsidiaries.

• Project development costs (Unit : Million Baht) 2010 2009 2008 Company – unconsolidated 6,749.27 66.67% 7,151.91 82.12% 7,085.15 79.33% Subsidiaries 3,373.73 33.33% 1,556.80 17.88% 1,845.93 20.67% Total* 10,123.00 100.00% 8,708.71 100.00% 8,931.08 100.00% Note * Project development cost in consolidated financial statements as of 31 December 2008 and 2010

• Non-consolidated development cost in 2008 rose by Bt659.67 million, due to the launch of 4 new projects. The cost slightly increased in 2009. In 2010, the cost dropped as some was transferred to sale cost while new projects were carried out by subsidiaries. The project development cost as of 31 December 2010 stood at Bt6,749.27 million, including the Bt55.79 million net provision against possible depreciation of project value. The provision was set accordingly to the accounting standards, when the book value was higher than the appraisal from independent appraisers. • Project development costs of the company’s subsidiaries were as follows: • Estate Perfect Co., Ltd. had 5 projects under development. The costs in 2010 were Bt1,620.25 million, Bt1.29million were net allowance for loss on diminution in value of projects. • Bright Development Bangkok Co., Ltd. had 6 project under development. The costs in 2010 amounted to Bt1,218.74million. • Residence Number Nine Co., Ltd. had 2 projects under development. The costs in 2010 amounted to Bt526.87 million. • Centre Point Shopping Mall Co., Ltd. had project development costs of Bt7.87 million in 2010.

• Net land bank (Unit : Million Baht) 2010 2009 2008 Company – unconsolidated 4,277.59 77.87% 2,713.86 74.89% 1,585.30 85.21% Subsidiaries 1,215.39 22.14% 909.78 25.11% 275.07 14.79% Total * 5,492.98 100.00% 3,623.64 100.00% 1,860.37 100.00% Note * Net land bank mentioned in financial statements at 31 December 2008 and 2010.

• The company’s and subsidiaries’ net land held for development at the end of 2008- 2010 had value of Bt1,860.37 million ,Bt3,623.64 million and Bt5,492.98 million,, respectively. The costs incorporated land costs, land development costs, construction costs, capitalized interest, less transferred to costs of sales, land transferred to settle debts under rehabilitation plan and allowance for loss on depreciation of land held for development. development. In 2008 and 2009, the provision for possible depreciation

96 PROPERTY PERFECT ANNUAL REPORT 2010 of land bank stood at Bt103.39 million and it rose to Bt104.00 million in 2010 when more land was purchased for the development of condominiums and townhouses.

The company and subsidiaries will consider reverting land bank to book as project development cost only when the development starts - for example, when the land is being cleared or when development plan is plotted.

• Cash and Equivalents (Unit: Bt million) 2010 2009 2008 Company – unconsolidated 1,585.30 78.56% 668.54 90.27% 428.61 94.19% Subsidiaries 432.55 21.44% 72.05 9.73% 26.44 5.81% Total * 2,017.85 100.00% 740.59 100.00% 455.05 100.00% Note: * Cash and equivalents as appeared in consolidated financial statements as of 31 December 2008- 2010

• Advance payment for land purchase (Unit: Bt million) 2010 2009 2008 Company – unconsolidated 348.55 62.84% 79.02 61.36% 388.90 81.67% Subsidiaries 206.09 37.16% 49.76 38.64% 87.26 18.33% Total * 554.64 100.00% 128.78 100.00% 476.16 100.00%

Advance payment for land purchase is the deposit given to landlords or agents commissioned to accumulate land for the company. Once the land purchase was completed the deposit will be booked as the project development cost or in land bank category.

Advance payment of the company and subsidiaries as of 31 December 2010 totaled Bt554.64 million. • Deposits to many landlords under land purchase contracts, signed jointly by landlords and agents, totaling Bt423.7 million: Bt262.1 million placed by the company and Bt161.6 million by subsidiaries. • Deposits of Bt130.9 million to agents for the purchases of land which are under the signing process: Bt86.5 million placed by the company and Bt44.4 million by subsidiaries.

The combined value of signed land purchase contracts as of 1 December 2008-2010 totaled Bt1,699.6 million, Bt452.4 million, and Bt2,658.5 million, respectively. • Investments in associates The company recorded profit sharing from investment in associates following profit adjustment of associates as the difference in accounting policy on sales revenue recognition of condominium units.

ANNUAL REPORT 2010 PROPERTY PERFECT 97 In 2005, Investments worth Bt300 million in Krungthep Land Public Company Limited represented a 20% stake in Krungthep Land Plc. (as of 31 December 2005, Krungthep Land’s paid-up capital was Bt1,500 million) and the Board of Directors’ meeting on 18 January 2007 approved the company to subscribe to Krungthep Land’s 6,000,000 capital increased shares at the par value of Bt10 each totaling Bt60 million to retain its shareholding ratio.

On 16 November 2007, Krungthep Land’s 1/2007 extraordinary shareholders meeting resolved to decrease the registered capital from Bt2,100,000 million to Bt1,780,000,000 by canceling 32,000,000 unissued shares at the par value of Bt10 each for Bt320,000,000. The meeting also approved the recapitalization of Bt450,000,000 from Bt1,780,000 to Bt2,230,000,000 by issuing 45,000,000 capital increased shares at the par value of Bt10 each to reserve for exercise of convertible debentures .

On 31 January 2008, Krungthep Land issued 188,806 units of 5-year, name-registered, unsecured convertible debentures with a face value of USD 100 or total value of USD 18,880,600, to an overseas company. In accordance with the conditions of the convertible debentures resolved by Krungthep Land's Extraordinary General Meeting of shareholders No.1/2551 on 14 January 2008, Krungthep Land is to pay interest semi-annually at a rate of not exceeding 3% per annum or a dividend yield (whichever is higher) only in years in which Krungthep Land declares a dividend based on the conditions of the convertible debentures and mature on 31 January 2013. They are convertible upon the listing of Krungthep Land’s shares on the Stock Exchange of Thailand (SET) or the Market for Alternative Investment (MAI), or one year from the issue date (whichever is earlier), at a conversion price of Bt13.85 per a common share, on quarterly basis. In case that no interest is paid until the maturity date, Krungthep Land is to redeem the outstanding convertible debentures at a price equal to 1.311651 times in the baht equivalent of the face value. Such redemption is subject to change dependent upon the interest payment made during the life of the debentures.

According to the consolidated financial statements, the company recorded profit sharing under the equity method and realized profit of Bt7.82million in 2008, Bt3.00million in 2009 and Bt57.89 million in 2010 as revenue in the income statements. Investments in associates under the equity method were Bt416.74million in 2008, Bt419.74million in 2009 and Bt477.62million in 2010. • Other guarantee obligations The company guaranteed financial institutions’ loans to subsidiaries worth totally Bt5,274.7 million: Bt2,035.0 million to Estate Perfect Company Limited; Bt2,309.7 million to Bright Development Bangkok Company Limited; and Bt930 million to Residence Number Nine Company Limited. The company is not yet obligated to show responsibility for the guarantees as the subsidiaries are still honoring their debts.

• Asset quality The company and subsidiaries have policy to realize revenue from sales of land and houses, land, and condominium units only when ownership rights are transferred to buyers. Thus, the company and subsidiaries record down payment and installments as liabilities in the item of deposits and clients' advance payment. The overdue installments are booked in the item of trade debtors.

Though the company focuses on selling pre-built houses, some clients prefer to buy houses under construction. The company then sold such houses to customers who are required to pay down payment in installments. The installments are included in trade debtors. Mostly, the debts in this item is cleared in less than a year.

98 PROPERTY PERFECT ANNUAL REPORT 2010 In 2010, consolidated trade debtors receivables totaled Bt32.07 million and consolidated allowance for doubtful debts for debtors who unpaid for over 12 months worth Bt10.29million. Thus, net consolidated trade debtors totaled Bt21.78 million. The company believes that the allowances are sufficient for the current situation. Consolidated trade debtors can be broken down into 2 groups. • Customers with overdue installments Customers with overdue installments are those who failed to pay installments for houses under construction. They had overdue installments of Bt12.97million or 40.34% of total overdue loans. • Customers with overdue transfer fee Customers with overdue transfer fee are those who did not pay all debts on the transaction date, accounting for 59.66%. However, the overdue loan worth Bt19.10 million representing 0.10% of total assets, an insignificant ratio. The company also made allowance worth Bt10.29 million.

For clients who fail to pay the debts for 6 months or longer, the company has contacted them to pay their obligations and some cases have been brought to court. The company believes that the allowance for doubtful debts is sufficient under the present circumstances. • Liquidity Statements of cash flow between 2008 and 2010 were as follows : (Unit: Million Baht) Item 2010 2009 2008 Cash flow from operating activities 414.10 1,233.59 1,330.43 Cash flow from investment activities (3,169.06) (1,660.86) (414.31) Cash flow from financing activities 4,032.23 712.81 (885.13) Net cash flow increase (decrease) 1,277.27 285.54 30.99

The operating cash flow on the consolidated basis stayed in the positive levels at Bt1,330.43 million, Bt1,233.59million and Bt414.10 million during 2008 and 2010, respectively. This allowed net cash flow to stay in the positive level of Bt30.99million, Bt285.44million and Bt1,277.27 million during the years.

Cash flow from investment activities has been in the negative area, totaling Bt414.31million, Bt1,660.86million and Bt3,169.06 million during 2008-2010, respectively . Due to the company's land bank purchases to prepare for the company's projects. Details as follow: • In 2008, the company’s and subsidiaries’ cash flow from investment activities came from advances for purchases of land and acquisition of land for development with a combined amount of Bt502.88 million. The company and subsidiaries invested in Property Perfect Fund amounting to Bt32.5 million or 6.24% of its registered capital and Quality Hospitality Leasehold Property Fund with the amount of Bt20 million or 1.1% of its registered capital. Besides, bank deposit with guaranteed obligations decreased to Bt217.27 million. • In 2009, consolidated payments and advance payment for more land plots totaled Bt1,599.15 million. Another Bt60 million was put as down payment for a company's shares worth Bt507 million. • In 2010, investing activities concerned advance payment for land purchase and land purchases worth totally Bt2,697.91 million, cash payment of Bt352.18 million for common shares in a company priced at Bt507 million, deposits containing guarantee obligations worth Bt17.04 million, and leasehold rights worth Bt64.03 million.

ANNUAL REPORT 2010 PROPERTY PERFECT 99 Regarding cash flow from financing activities during 2008 and 2009, in 2007 debt repayment totaled Bt470.13 million aside from bond redemption worth Bt350 million. In 2008, debt repayment rose to Bt696.12 million while dividend payment totaled Bt189.01 million. In 2009, the company raised Bt1,329.40 million from the issuance of debentures and Bt1,272.10million from bills of exchange and promissory notes. Debt repayment totaled Bt1,6015.16 million while dividend payment topped Bt283.54 million. In 2010, financial activities concerned the issuance of Bt4,768.38 million debentures, long-term borrowing worth Bt296.65 million, a net increase of bill of exchange of Bt682.17 million, debenture redemption worth Bt1,083.07 million, promissory note redemption of Bt355.0 million, repayment of advance payment by directors worth Bt80 million, and dividend payment worth Bt196.90 million. • Dividend payment The company has paid dividends as follows: • For the 2007 performance, shareholders received Bt0.24 per share, totaling Bt189.01 million, as of 30 May 2008. • For the 2008 performance, shareholders received Bt0.36 per share, totaling Bt283.54 million, as of 29 May 2009. • For the 2009 performance, shareholders received Bt0.25 per share, totaling Bt196.90million, as of 27 May 2010.

Source of Funds • Liabilities As of 31 December 2010, consolidated liabilities reached Bt12,555 million (Bt10,550.66 million belonging to the company and Bt2,004.34 million to subsidiaries), up Bt4,897.84 million from 2009. Major changes are as follows; • Net increase of new debentures by Bt4,784.29 million, net borrowing Bt296.65 million, bill of exchange Bt682.17 million, trade creditors Bt315.57 million and overdue expense Bt193.48 million. • Decreases by Bt1,083.07 million convertible debenture redemption, Bt355.0 million promis- sory note redemption, and repayment of advance payment by directors worth Bt80 million,

The consolidated debt structure as of 31 December 2010 consisted of debentures, 52.40% of total; long-term loans, 19.39%; bill of exchange, 15.91%, and promissory notes, 0.60%. Details are as follows; • Debentures As of 31 December 2010, outstanding secured debentures, of which principal is to be paid in full on maturity date, totaled Bt6,600 million (Bt6,578.215 million net, inclusive of advance insurance fee ). All debentures were issued by the company to finance land purchase, increase working capital and repay loans. Details of the debentures are as follows;

100 PROPERTY PERFECT ANNUAL REPORT 2010 Secured/unsecured debentures issued by Property Perfect Public Company Limited

Value Issue Maturity Date Condition (Million Baht) Date Secured debentures#2/2009 300.000 14 Aug. 14 Feb. 2011 • The ratio of collateral against (1), Bt300 million, 4.85% 2009 outstanding debenture value must interest per annum, payable be maintained at 1.6:1 every 3 months • The ratio of total loans to shareholders’ equity must not exceed 1.75:1 Secured debentures#2/2009 800.000 14 Aug. 14 Aug. 2012 • The ratio of collateral against (2), Bt800 million, interest 6% 2009 outstanding debenture value must per annum, payable every be maintained at 1.6:1 3 months • The ratio of total loans to shareholders’ equity must not exceed 1.75:1 Partially collateralized deben- 1,478.215 26 Feb. 26 Feb. 2013 • The ratio of total loans to shareholders’ tures#1/2010, Bt1,500 million, 2010 equity must not exceed 1.75:1 interest 5.90% per annum, payable every 3 months

Unsecured debentures 500.000 26 Aug. 20 May 2011 N/A #1/2010, Bt500 million, interest 2010 4.65% per annum, payable on maturity date

Secured debentures#2/2010, 1,000.000 9 Sept. 9 March 2012 • The ratio of collateral against out Bt1,000 million, interest 5.50% 2010 standing debenture value must be per annum, payable every maintained at 1:1 3 months • The ratio of total loans to shareholders’ equity must not exceed 1.75:1

Secured debentures#3/2010, 1,000.000 18 Nov. 18 Nov. 2013 • The ratio of collateral against out Bt1,000 million, interest 5.80% 2010 standing debenture value must be per annum, payable every maintained at 1:1 3 months • The ratio of total loans to shareholders’ equity must not exceed 2:1

ANNUAL REPORT 2010 PROPERTY PERFECT 101 Value Issue Maturity Date Condition (Million Baht) Date Unsecured debentures 1,500.000 18 Nov. 18 Nov. 2013 • The ratio of total loans to shareholders’ #4/2010, Bt1,500 million, 2010 equity must not exceed 2:1 interest 6.50% per annum, payable every 3 months

Total 6,578.215

During 2010, on 3 Sept 2010, the company made an early redemption for the following debentures.

Value Issue Maturity Date Condition (Million Baht) Date Secured debentures#1/2009, 520.00 3 June. 2009 3 June. 2012 • The ratio of collateral against outstanding Bt520 million, interest 6% debenture value (excluding the value per annum, payable every 3 of bank guarantees) must be maintained months at 1.6:1 • The ratio of total loans to shareholders’ equity must not exceed 1.75:1

• Long-term loans As of 31 December 2010, outstanding long-term loans totaled Bt2,433.79 million: Bt815.86 million belonging to the company and Bt1,617.93 million to subsidiaries. The loans are used to finance property project development. Details are as follows;

Unit (Million Baht) 31 December 2010 31 December 2009 31 December 2008 Company Sub Total Company Sub Total Company Sub Total sidiaries sidiaries sidiaries Long-term loans 815.86 1,617.93 2,433.79 1,865.03 272.11 2,137.14 2,564.97 389.47 2,954.44 Minus – amount due within 1 year - - - 148.68 45.54 194.22 228.88 4.22 233.10 Long-term loans (Net) 815.86 1,617.93 2,433.79 1,716.35 226.57 1942.92 2,336.09 385.25 2,721.34

In addition, the company guaranteed loans extended by financial institutions to subsidiaries with a combined amount of Bt5,274.69million. • Bill of exchange As of 31 December 2010, outstanding totaled Bt1,997.29 million (face value of Bt2,000 million). All were issued by the company, carrying 4.5-5.0% per annum interest and coming due between February- June 2011.

102 PROPERTY PERFECT ANNUAL REPORT 2010 • Promissory notes As of 31 December 2010, outstanding totaled Bt75 million. They were issued to pay for investment in Residence Number Nine Company Limited. Carrying no interest, they will come due on 31 March 2011. • Shareholders’ equity Consolidated shareholders' equity in 2010 totaled Bt7,174.43million, increase Bt 354.34 million from 2009. resulted from the entire net profit in 2010.

Shareholders' equity structure incorporates Bt4,726.34 million paid-up capital at Bt6 par value, Bt(20.57 )million discount on share, unsubordinated convertible debentures' equity component worth Bt7.47million (entirely borne by the company), The unrealized loss incurred by the Bt3.55million drop in investment value, legal provisions of Bt206.10million, unallocated accumulated earning of Bt2,264.49million, and (Bt5.8 million) share loss in subsidiaries deriving from additional investment above subsidiaries’ book value on the transaction date.

On 31 December 2010, outstanding unconverted warrants issued to creditors without collaterals were 8.86 million units. Each warrant is entitled to a 1 common share conversion at the price of Bt0.01 per share. The 10-year warrants can be exercised on the last day of the second and fourth quarter, starting from the fourth quarter of 2002.

• Debt to equity ratio The debt to equity ratio in 2007 was 1.12:1 before falling to 0.93:1 in 2008 and increasing to 1.12:1 in 2009 when debts rose on top of land purchases to accommodate future expansion.

ANNUAL REPORT 2010 PROPERTY PERFECT 103 Report of Independent Auditor

(Unit: Baht) To the Shareholders of Property Perfect PublicConsolidated Company financialLimited statements Seperate financial statements I have audited the accompanying consolidatedNote balance2010 sheet of Property2009 Perfect Public2010 Company Limited2009 and its subsidiaries as at 31 December 2009and2010, the related consolidated statements of income, changes in shareholders’ equity and cash flows for the year then ended, and the separate financial statements of Property Perfect Public Company Limited for the same period. These financial statements are the responsibility of the management of the Company and its subsidiaries as to their correctness and the completeness of the presentation. My responsibility is to express an opinion on these financial statements based on my audit.

I conducted my audit in accordance with generally accepted auditing standards. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audit provides a reasonable basis for my opinion.

In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Property Perfect Public Company Limited and its subsidiaries and of Property Perfect Public Company Limited as at 31 December 2009 and 2010, the results of their operations, and cash flows for the year then ended, in accordance with generally accepted accounting principles.

Siraporn Ouaanunkun Certified Public Accountant (Thailand) No.3844

Ernst & Young Office Limited Bangkok: 26 February 2010

104 PROPERTY PERFECT ANNUAL REPORT 2010 Balance sheets Property Perfect Public Company Limited and its subsidiaries As at 31 December 2010 and 2009 (Unit: Baht) Consolidated financial statements Seperate financial statements Note 2010 2009 2010 2009 Assets Current assets Cash and cash equivalents 7 2,017,853,585 740,586,086 1,585,301,183 668,539,373 Trade accounts receivable 32,070,432 41,293,226 23,137,232 37,265,493 Less: Allowance for doubtful accounts (10,293,299) (11,193,299) (10,293,299) (11,193,299) Trade accounts receivable, net 8 21,777,133 30,099,927 12,843,933 26,072,194 Account receivable - land 9 66,436,938 30,958,000 66,436,938 30,958,000 Project development costs, net 10 10,122,996,494 8,708,711,350 6,749,274,992 7,151,912,394 Leasehold rights awaiting sale, net 18 - - - 64,923,228 Other current assets Retention per agreement 9 100,000,000 - 100,000,000 - Advances to contractors, net 127,639,059 86,230,565 96,769,559 86,230,565 Prepaid expenses 13,644,489 14,125,428 13,644,489 14,125,428 Others 35,145,960 29,428,369 11,122,429 25,420,517 Total current assets 12,505,493,658 9,640,139,725 8,635,393,523 8,068,181,699 Non-current assets Restricted deposits 11 18,488,378 1,448,880 18,488,378 1,448,880 Advances to related company 6 - - 1,500,000 1,500,000 Loans to related companies and interest receivable 6 - - 1,308,037,850 792,040,997 Investments in subsidiaries 12 - - 1,897,157,356 541,057,356 Investment in associate 13 477,622,798 419,736,574 359,999,240 359,999,240 Other long-term investments, net 14 55,522,880 53,726,160 55,522,880 53,726,160 Land held for development, net 15 5,492,985,169 3,623,641,774 4,277,594,556 2,713,863,099 Advances for purchases of land 16 554,641,400 128,775,752 348,550,150 79,020,752 Property, plant and equipment, net 17 312,013,827 341,693,881 252,477,758 290,676,270 Leasehold rights, net 18 173,311,462 117,805,081 49,670,758 52,881,853 Other non-current assets Withholding tax deducted at source 91,449,736 37,088,340 74,537,729 36,715,792 Deposit for purchase of shares 12 - 60,000,000 - 60,000,000 Others 47,398,628 52,688,129 39,018,818 48,176,865 Total non-current assets 7,223,434,278 4,836,604,571 8,682,555,473 5,031,107,264 Total assets 19,728,927,936 14,476,744,296 17,317,948,996 13,099,288,963

The accompanying notes are an integral part of the financial statements.

ANNUAL REPORT 2010 PROPERTY PERFECT 105 Balance sheets (continued) Property Perfect Public Company Limited and its subsidiaries As at 31 December 2010 and 2009 (Unit: Baht) Consolidated financial statements Seperate financial statements Note 2010 2009 2010 2009 Liabilities and shareholders' equity Current liabilities Trade accounts payable 800,746,867 485,171,615 572,738,441 408,011,684 Note payable 19 75,000,000 355,000,000 75,000,000 - Bills of exchange payable 20 1,997,291,957 1,266,264,051 1,997,291,957 1,266,264,051 Current portion of debentures 21 800,000,000 187,150,000 800,000,000 - Creditors per rehabilitation plan 22 37,037,390 37,037,390 37,037,390 37,037,390 Unsubordinated convertible debentures - 23 - 812,558,417 - 812,558,417 liability component Current portion of long-term loans 24 - 194,222,860 - 148,683,961 Amounts due to related companies 6 - - 1,440,772 81,246,015 Advance from director 6 - 80,000,000 - - Deposits and cash received in advance 8 86,356,760 107,467,518 31,886,340 88,889,110 Provisions 25 12,739,663 212,467,366 12,739,663 212,467,366 Other current liabilities Accrued interest 78,063,608 16,055,682 75,324,631 14,803,034 Accrued expenses 291,476,620 159,997,229 203,685,452 114,746,406 Accrued corporate income tax - 76,274,504 - 53,373,063 Others 112,335,266 62,509,571 97,995,589 58,016,130 Total current liabilities 4,291,048,131 4,052,176,203 3,905,140,235 3,296,096,627 Non-current liabilities Debentures, net of current portion 21 5,778,215,227 1,606,776,162 5,778,215,227 1,606,776,162 Long-term loans, net of current portion 24 2,433,788,730 1,942,916,047 815,862,412 1,716,346,538 Deposits and cash received in advance 51,444,790 54,783,437 51,444,790 54,783,437 for sublease agreement Total non-current liabilities 8,263,448,747 3,604,475,646 6,645,522,429 3,377,906,137 Total liabilities 12,554,496,878 7,656,651,849 10,550,662,664 6,674,002,764

The accompanying notes are an integral part of the financial statements.

106 PROPERTY PERFECT ANNUAL REPORT 2010 Balance sheets (continued) Property Perfect Public Company Limited and its subsidiaries As at 31 December 2010 and 2009 (Unit: Baht) Consolidated financial statements Seperate financial statements Note 2010 2009 2010 2009 Shareholders' equity Share capital 26 Registered 1,092,000,000 ordinary shares of Baht 6 each 6,552,000,000 6,552,000,000 6,552,000,000 6,552,000,000 Issued and fully paid 787,724,120 ordinary shares of Baht 6 each (2009: 787,721,620 ordinary shares of Baht 6 each) 4,726,344,720 4,726,329,720 4,726,344,720 4,726,329,720 Share discount 23, 26 (20,573,149) (44,093,444) (20,573,149) (44,093,444) Share subscriptions received in advance 27 66 25 66 25 Excess of investment in subsidiary arising as a result of additional purchase of investment in the subsidiary at a price higher than the net book value of the subsidiary at the acquisition date (5,856,198) - - - Unsubordinated convertible debentures 23 7,476,716 31,011,986 - 23,535,270 - equity component Unrealised loss Revaluation deficit on changes in value of investments (3,548,690) (4,750,330) (3,548,690) (4,750,330) Retained earnings Appropriated - statutory reserve 28 206,100,000 179,100,000 206,100,000 179,100,000 Unappropriated 2,264,487,593 1,937,950,688 1,858,963,385 1,545,164,958 Equity attributable to the Company’s shareholders Minority interest - equity attributable to 7,174,431,058 6,825,548,645 6,767,286,332 6,425,286,199 minority shareholders of subsidiaries - (5,456,198) - - Total shareholders' equity 7,174,431,058 6,820,092,447 6,767,286,332 6,425,286,199 Total liabilities and shareholders' equity 19,728,927,936 14,476,744,296 17,317,948,996 13,099,288,963

The accompanying notes are an integral part of the financial statements.

ANNUAL REPORT 2010 PROPERTY PERFECT 107 Income statements Property Perfect Public Company Limited and its subsidiaries For the years ended 31 December 2010 and 2009 (Unit: Baht) Consolidated financial statements Seperate financial statements Note 2010 2009 2010 2009 Revenues Revenues from sales of land and houses 7,002,701,311 5,073,423,380 5,849,113,719 4,067,577,404 Revenues from sales of residential condominium units 777,725,952 778,469,844 777,725,952 778,469,844 Revenue from sale of land 835,490,250 - 835,490,250 - Other income Interest income 7,273,932 606,892 54,121,066 42,494,943 Revenues from forfeiture of down payments 4,302,238 8,488,292 3,388,654 8,017,699 Others 76,407,452 86,834,101 65,812,589 80,445,648 Total revenues 8,703,901,135 5,947,822,509 7,585,652,230 4,977,005,538 Expenses Cost of sales of land and houses 4,606,857,142 3,514,251,255 3,835,537,610 2,796,302,041 Cost of sales of residential condominium units 496,704,051 551,946,601 496,704,051 551,946,601 Cost of sale of land 695,762,581 - 695,762,581 - Selling expenses 749,548,640 270,135,874 598,083,442 236,867,700 Administrative expenses 916,347,687 692,947,872 741,157,693 601,055,593 Management benefit expenses 6 90,248,069 71,497,059 72,411,296 56,235,043 Loss arising from minimum revenue guarantee 25 35,602,103 9,422,551 35,602,103 9,422,551 Total expenses 7,591,070,273 5,110,201,212 6,475,258,776 4,251,829,529 Income before share of income from investment in associate, finance cost and corporate income tax 1,112,830,862 837,621,297 1,110,393,454 725,176,009 Share of income from investment in associate 13 57,886,223 2,998,095 - - Income before finance cost and corporate income tax 1,170,717,085 840,619,392 1,110,393,454 725,176,009 Finance cost (465,089,702) (286,591,111) (459,875,182) (230,722,567) Income before corporate income tax 705,627,383 554,028,281 650,518,272 494,453,442 Corporate income tax (155,190,445) (154,276,756) (112,819,812) (108,127,524) Net income for the year 550,436,938 399,751,525 537,698,460 386,325,918

Net income (loss) attributable to: Equity holders of the parent 550,436,938 403,627,020 537,698,460 386,325,918 Minority interests of the subsidiaries - (3,875,495) 550,436,938 399,751,525 Earnings per share 30 Basic earnings per share Net income attributable to equity holders of the parent 0.699 0.512 0.683 0.490 Diluted earnings per share Net income attributable to equity holders of the parent 0.691 0.507 0.675 0.485

The accompanying notes are an integral part of the financial statements.

108 PROPERTY PERFECT ANNUAL REPORT 2010 Cash flFlow statements Property Perfect Public Company Limited and its subsidiaries For the years ended 31 December 2010 and 2009 (Unit: Baht) Consolidated financial statements Seperate financial statements Note 2010 2009 2010 2009 Cash flows from operating activities Income before tax 705,627,383 554,028,281 650,518,272 494,453,442 Adjustments to reconcile income before tax to net cash provided by (paid from) operating activities: Share of income from investment in associate (57,886,223) (2,998,095) - - Depreciation and amortisation 62,856,916 66,381,957 51,520,358 57,176,936 Amortisation of prepaid expenses 27,142,681 22,235,190 22,909,173 20,098,965 Amortisation of premium on debentures 10,441,583 3,404,517 10,441,583 3,404,517 Provision for unconverted debentures 57,158,531 57,067,834 57,158,531 57,067,834 Amortisation of deferred debenture issuing costs 15,910,665 2,376,162 15,910,665 2,376,162 Rental received in advance recognition (4,628,646) (4,128,646) (4,628,646) (4,128,646) Reversal of allowance for loss on impairment of (152,660) (229,578) (152,660) (229,578) investment Loss arising from minimum revenue guarantee 35,602,103 9,422,551 35,602,103 9,422,551 Loss on impairment of assets 9,099,739 4,143,880 14,102,034 4,143,880 Loss (gain) on sales of property, plant and equipment 173,531 (18,415,498) 173,531 (18,415,498) Doubtful accounts - 900,000 - 900,000 Dividend income (4,620,726) (5,240,888) (4,620,726) (5,240,888) Interest income (7,273,932) (606,892) (54,121,066) (42,494,943) Interest expenses 318,258,592 178,957,075 314,015,152 138,043,527 Income from operating activities before changes in operating assets and liabilities 1,167,709,537 867,297,850 1,108,828,304 716,578,261 Decrease (increase) in operating assets Trade accounts receivable 8,322,794 2,803,083 13,228,261 3,216,066 Account receivable - land (35,478,938) 4,400,000 (35,478,938) 4,400,000 Project development costs (254,600,402) 909,619,614 739,614,035 596,869,953 Retention per agreement (100,000,000) - (100,000,000) - Advances to contractors (41,408,494) (41,484,832) (10,538,994) (44,014,194) Prepaid expenses (26,661,742) (21,680,866) (22,428,234) (19,544,641) Other current assets (5,717,591) (13,744,628) 14,298,087 (13,315,415) Other non-current assets 5,499,004 (25,118,795) 9,158,044 (24,796,917) Increase (decrease) in operating liabilities Trade accounts payable 221,980,262 12,287,803 71,131,767 5,183,638 Amounts due to related companies - - (79,805,243) (2,708,437) Deposits and cash received in advance (21,110,758) (4,767,978) (57,002,770) (14,795,304) Cash paid for minimum revenue guarantee (36,602,344) (40,366,736) (36,602,344) (40,366,736) Other current liabilities 184,231,739 (20,138,711) 124,809,026 (28,779,010) Net cash from operating activities 1,066,163,067 1,629,105,804 1,739,211,001 1,137,927,264 Cash paid for interest expenses (343,856,183) (319,525,273) (289,422,389) (250,725,228) Cash paid for corporate income tax (315,505,823) (80,053,101) (240,694,850) (54,754,461) Cash received for interest income 7,294,972 606,892 7,064,210 - Return of withholding tax - 3,459,197 - - Net cash from operating activities 414,096,033 1,233,593,519 1,216,157,972 832,447,575

The accompanying notes are an integral part of the financial statements.

ANNUAL REPORT 2010 PROPERTY PERFECT 109 Cash flFlow statements (continued) Property Perfect Public Company Limited and its subsidiaries For the years ended 31 December 2010 and 2009 (Unit: Baht) Consolidated financial statements Seperate financial statements Note 2010 2009 2010 2009 Cash flows from investing activities Decrease (increase) in restricted deposits (17,039,498) 7,409,062 (17,039,498) 7,409,062 Increase in loans to related companies - - (1,175,726,070) (350,992,429) Cash received for interest income - - 20,850,283 13,499,321 Cash received for dividend income 4,620,726 5,240,888 4,620,726 5,240,888 Increase in deposit for purchase of shares - (60,000,000) - (60,000,000) Cash paid for purchase of investment in subsidiary (Note 12) (352,181,539) - (522,100,000) - Cash paid for purchase of minority interest (Note 12) (400,000) - - - Increase in other long-term investments (442,420) (1,154,900) (442,420) (1,154,900) Increase in land held for development (2,188,409,941) (1,487,097,620) (1,621,913,546) (1,278,141,421) Increase in advances for purchases of land (509,497,698) (112,053,552) (339,411,448) (63,798,552) Proceeds from sales of leasehold rights - - 65,000,000 - Increase in leasehold rights (64,033,319) (1,449,432) - (1,449,432) Increase in property, plant and equipment (41,987,869) (36,283,003) (22,109,303) (29,084,083) Proceeds from sales of property, plant and equipment 316,287 24,531,388 316,287 24,531,388 Net cash used in investing activities (3,169,055,271) (1,660,857,169) (3,607,954,989) (1,733,940,158) Cash flows from financing activities Decrease in bank overdrafts and short-term loans from financial institutions - (528,268,062) - (508,000,000) Increase (decrease) in note payable (355,000,000) 15,000,000 - - Decrease in loans from individual/other company - (31,000,000) - - Increase in bills of exchange payable 682,166,547 1,257,099,868 682,166,547 1,257,099,868 Decrease in advances from directors (80,000,000) - - - Increase (decrease) in long-term loans 296,649,823 (817,296,716) (1,049,168,087) (699,943,930) Increase in debentures 4,768,378,400 1,329,400,000 4,955,528,400 1,604,400,000 Decrease in unsubordinated convertible debentures (1,083,068,000) - (1,083,068,000) - Decrease in creditors per rehabilitation plan - (228,595,766) - (228,595,766) Dividend paid (196,900,033) (283,535,147) (196,900,033) (283,535,147) Net cash from financing activities 4,032,226,737 712,804,177 3,308,558,827 1,141,425,025 Net increase in cash and cash equivalents 1,277,267,499 285,540,527 916,761,810 239,932,442 Cash and cash equivalents at beginning of year 740,586,086 455,045,559 668,539,373 428,606,931 Cash and cash equivalents at end of year 2,017,853,585 740,586,086 1,585,301,183 668,539,373

Supplemental cash flow information Non-cash transactions Transfer advances for purchases of land to project development costs and land held for development 83,632,050 459,437,448 63,882,050 373,682,013 Transfer advances for purchases of land to loan to related company - - 6,000,000 - Transfer land held for development to project development costs 563,268,037 480,418,666 132,986,844 480,418,666 Transfer property, plant and equipment to project development costs 2,408,994 21,898,776 2,408,994 21,898,776 Settle increased share capital with loan to related company and interest receivable - - 699,000,000 - Issue promissory notes to pay land costs - 340,000,000 - - Issue promissory notes to purchase investment in a subsidiary 75,000,000 - 75,000,000 - Record deposit for purchase of shares as investment in a subsidiary 60,000,000 - 60,000,000 - The accompanying notes are an integral part of the financial statements.

110 PROPERTY PERFECT ANNUAL REPORT 2010 Statements of changes in shareholders’ equity Property Perfect Public Company Limited and its subsidiaries For the years ended 31 December 2010 and 2009 (Unit: Baht) Consolidated financial statements Equity attributable to the parent’s shareholders Minority Excess of investment in interest - subsidiary arising as a result Unsubordinated Retained earnings equity of additional purchase of convertible Revaluation attributable Share sub- investment in the subsidiary debentures - deficit on Total equity to minority Issued and scriptions at a price higher than the net equity changes in attributable to shareholders fully paid Share received book value of the subsidiary component value of Statutory the parent’s of share capital discount in advance at the acquisition date investments reserve Unappropriated shareholders subsidiaries Total Balance - as at 31 December 2008 4,726,329,720 (44,093,444) - - 31,011,986 (5,396,570) 159,100,000 1,837,858,815 6,704,810,507 (1,580,703) 6,703,229,804 Income recognised directly in equity: Investments in available-for-sale securities Gain recognised in shareholders' equity - - - - - 646,240 - - 646,240 - 646,240 Net income recognised directly in equity - - - - - 646,240 - - 646,240 - 646,240 Net income (loss) for the year ------403,627,020 403,627,020 (3,875,495) 399,751,525 Total income and expenses for the year - - - - - 646,240 - 403,627,020 404,273,260 (3,875,495) 400,397,765 Share subscriptions received in advance - - 25 - - - - - 25 - 25 Dividend paid (Note 33) ------(283,535,147) (283,535,147) - (283,535,147) Unappropriated retained earnings transferred ------20,000,000 (20,000,000) - - - to statutory reserve Balance - as at 31 December 2009 4,726,329,720 (44,093,444) 25 - 31,011,986 (4,750,330) 179,100,000 1,937,950,688 6,825,548,645 (5,456,198) 6,820,092,447

Balance - as at 31 December 2009 4,726,329,720 (44,093,444) 25 - 31,011,986 (4,750,330) 179,100,000 1,937,950,688 6,825,548,645 (5,456,198) 6,820,092,447 Income recognised directly in equity: Investments in available-for-sale securities

ANNUAL REPORT 2010 Gain recognised in shareholders' equity - - - - - 1,201,640 - - 1,201,640 - 1,201,640 Net income recognised directly in equity - - - - - 1,201,640 - - 1,201,640 - 1,201,640 Net income for the year ------550,436,938 550,436,938 - 550,436,938 Total income for the year - - - - - 1,201,640 - 550,436,938 551,638,578 - 551,638,578 Additional ordinary shares as a result of 15,000 (14,975) (25) ------warrant exercised Share subscriptions received in advance - - 66 - - - - - 66 - 66

PROPERTY PERFECT Additional purchase of investment in - - - (5,856,198) - - - - (5,856,198) 5,456,198 (400,000) subsidiary (Note 12) Repayment for unsubordinated convertible - 23,535,270 - - (23,535,270) ------debentures (Note 23) Dividend paid (Note 33) ------(196,900,033) (196,900,033) - (196,900,033) Unappropriated retained earnings transferred ------27,000,000 (27,000,000) - - - to statutory reserve Balance - as at 31 December 2010 4,726,344,720 (20,573,149) 66 (5,856,198) 7,476,716 (3,548,690) 206,100,000 2,264,487,593 7,174,431,058 - 7,174,431,058 111

The accompanying notes are an integral part of the financial statements. 112 Statements of changes in shareholders’ equity (continued) Property Perfect Public Company Limited and its subsidiaries PROPERTY PERFECT For the years ended 31 December 2010 and 2009 (Unit: Baht) Separate financial statements Share Revaluation deficit Retained earnings Issued and fully subscriptions Unsubordinated on changes in paid Share received in convertible debentures - value of

ANNUAL REPORT 2010 share capital discount advance equity component investments Statutory reserve Unappropriated Total Balance - as at 31 December 2008 4,726,329,720 (44,093,444) - 23,535,270 (5,396,570) 159,100,000 1,462,374,187 6,321,849,163 Income recognised directly in equity: Investments in available-for-sale securities Gain recognised in shareholders' equity - - - - 646,240 - - 646,240 Net income recognised directly in equity - - - - 646,240 - - 646,240 Net income for the year ------386,325,918 386,325,918 Total income for the year - - - - 646,240 - 386,325,918 386,972,158 Share subscriptions received in advance - - 25 - - - - 25 Dividend paid (Note 33) ------(283,535,147) (283,535,147) Unappropriated retained earnings transferred - - - - - 20,000,000 (20,000,000) - to statutory reserve Balance - as at 31 December 2009 4,726,329,720 (44,093,444) 25 23,535,270 (4,750,330) 179,100,000 1,545,164,958 6,425,286,199

Balance - as at 31 December 2009 4,726,329,720 (44,093,444) 25 23,535,270 (4,750,330) 179,100,000 1,545,164,958 6,425,286,199 Income recognised directly in equity: Investments in available-for-sale securities Gain recognised in shareholders' equity - - - - 1,201,640 - - 1,201,640 Net income recognised directly in equity - - - - 1,201,640 - - 1,201,640 Net income for the year ------537,698,460 537,698,460 Total income for the year - - - - 1,201,640 - 537,698,460 538,900,100 Additional ordinary shares as a result of warrant exercised 15,000 (14,975) (25) - - - - - Share subscriptions received in advance - - 66 - - - - 66 Repayment for unsubordinated convertible debentures (Note 23) - 23,535,270 - (23,535,270) - - - - Dividend paid (Note 33) ------(196,900,033) (196,900,033) Unappropriated retained earnings transferred to statutory reserve - - - - - 27,000,000 (27,000,000) - Balance - as at 31 December 2010 4,726,344,720 (20,573,149) 66 - (3,548,690) 206,100,000 1,858,963,385 6,767,286,332

The accompanying notes are an integral part of the financial statements. Notes to consolidated fifififiFinancial statements

Property Perfect Public Company Limited and its subsidiaries For the years ended 31 December 2010 and 2009 1. General information Property Perfect Public Company Limited (“the Company”) is a public company incorporated and domiciled in Thailand. The Company is principally engaged in the property development. The registered office of the Company is at 100/1 Vorasombat Building, 17th Floor, Rama 9 Road, Huaykwang, Bangkok. 2. Basis of preparation 2.1 The financial statements have been prepared in accordance with accounting standards enunciated under the Accounting Profession Act B.E. 2547 and their presentation has been made in compliance with the stipulations of the Notification of the Department of Business Development dated 30 January 2009, issued under the Accounting Act B.E. 2543. The financial statements in Thai language are the official statutory financial statements of the Company. The financial statements in English language have been translated from the Thai language financial statements. The financial statements have been prepared on a historical cost basis except where otherwise disclosed in the accounting policie. 2.2 Basis of consolidation a) The consolidated financial statements include the financial statements of the Company (“the Company”) and the following subsidiary companies (“the subsidiaries”):

Country of Percentage of Company’s name Nature of business incorporation shareholding 2010 2009 % % Estate Perfect Company Limited Property development Thailand 100.00 100.00 Perfect Sport Club Company Limited (Formally known as “Perfect Satellite Services Company Limited”) Clubhouse management Thailand 99.98 99.98 Bright Development Bangkok Company Limited Property development Thailand 100.00 99.94 Centre Point Shopping Mall Company Limited Property development Thailand 100.00 59.99 Residence Number Nine Company Limited Property development Thailand 100.00 -

Assets as Revenues as a percentage a percentage to To the consolidated total the consolidated total assets revenues for the years Company’s name as at 31 December ended 31 December 2010 2009 2010 2009 % % % % Estate Perfect Company Limited 13.11 14.58 12.92 17.01 Perfect Sport club Co./ Ltd 0.04 0.04 - - (Formerly : Perfect Satellite Services Company Limited ) Bright Development Bangkok Company Limited 9.69 3.65 - - Centre Point Shopping Mall Company Limited 0.75 0.05 - - Residence Number Nine Company Limited 4.26 - 0.46

ANNUAL REPORT 2010 PROPERTY PERFECT 113 b) Subsidiaries are fully consolidated as from the date of acquisition, being the date on which the Company obtains control, and continue to be consolidated until the date when such control ceases. c) The financial statements of the subsidiaries are prepared using the same significant accounting policies as the Company. d) Material balances and transactions between the Company and its subsidiaries have been eliminated from the consolidated financial statements. e) Minority interests represent the portion of net income or loss and net assets of the subsidiaries that are not held by the Company and are presented separately in the consolidated income statement and within equity in the consolidated balance sheet. f) On 12 November 2009, a meeting of the Company’s Board of Directors passed a resolution to approve an increase in the registered share capital of Bright Development Bangkok Company Limited from Baht 1 million (10,000 ordinary shares with a par value of Baht 100 each) to Baht 500 million (5 million ordinary shares with a par value of Baht 100 each). The Company held all shares. (The Company has paid up the additional share capital in March 2010). g) On 22 January 2010, a meeting of the Company’s Board of Directors passed a resolution to approve the purchase of the remaining shares of Centrepoint Shopping Mall Company Limited held by a company, for a total consideration of Baht 400,000 (4,000 ordinary shares with a value of Baht 100 each). This will increase the Company’s shareholding in Centrepoint Shopping Mall Company Limited from 59.99% to 100.00% as a result. (The Company has purchased the shares in April 2010). h) On 22 January 2010, a meeting of the Company’s Board of Directors passed a resolution to approve an increase in the registered share capital of Centrepoint Shopping Mall Company Limited from Baht 1 million (10,000 ordinary shares with a par value of Baht 100 each) to Baht 500 million (5 million ordinary shares with a par value of Baht 100 each). The Company held all shares. (The Company has paid the called up portion (30%) of the additional share capital in April 2010). i) On 22 January 2010, a meeting of the Company’s Board of Directors passed a resolution to approve an increase in the registered share capital of Estate Perfect Company Limited from Baht 1,000 million (100 million ordinary shares with a par value of Baht 10 each) to Baht 1,200 million (120 million ordinary shares with a par value of Baht 10 each). The Company held all shares. (The Company has paid up the additional share capital in March 2010). j) On 9 December 2009, a meeting of the Company’s Board of Directors passed a resolution to approve the acquisition of 100 million ordinary shares with a par value of Baht 10 each of Residence Number Nine Limited, for a price of Baht 507 million (100% of the paid up capital). On 2 March 2010, the Company received the transfer of ownership of these shares from the seller. Therefore, the Company included Residence Number Nine Limited’s financial statements in its consolidated financial statements as from 2 March 2010 onwards.

2.3 The separate financial statements, which present investments in subsidiaries and associate under the cost method, have been prepared solely for the benefit of the public.

114 PROPERTY PERFECT ANNUAL REPORT 2010 3. Adoption of new accounting standards During the current year, the Federation of Accounting Professions issued a number of revised and new accounting standards as listed below. 3.1 Accounting standards that are effective for fiscal years beginning on or after 1 January 2011 (except Framework for the Preparation and Presentation of Financial Statements, which is immediately effective): Framework for the Preparation and Presentation of Financial Statements (revised 2009) Principal standards (revised 2009) TAS 1 (revised 2009) Presentation of Financial Statements TAS 2 (revised 2009) Inventories TAS 7 (revised 2009) Statement of Cash Flows TAS 8 (revised 2009) Accounting Policies, Changes in Accounting Estimates and Errors TAS 10 (revised 2009) Events after the Reporting Period TAS 11 (revised 2009) Construction Contracts TAS 16 (revised 2009) Property, Plant and Equipment TAS 17 (revised 2009) Leases TAS 18 (revised 2009) Revenue TAS 19 Employee Benefits TAS 23 (revised 2009) Borrowing Costs TAS 24 (revised 2009) Related Party Disclosures TAS 26 Accounting and Reporting by Retirement Benefit Plans TAS 27 (revised 2009) Consolidated and Separate Financial Statements TAS 28 (revised 2009) Investments in Associates TAS 29 Financial Reporting in Hyperinflationary Economies TAS 31 (revised 2009) Interests in Joint Ventures TAS 33 (revised 2009) Earnings per Share TAS 34 (revised 2009) Interim Financial Reporting TAS 36 (revised 2009) Impairment of Assets TAS 37 (revised 2009) Provisions, Contingent Liabilities and Contingent Assets TAS 38 (revised 2009) Intangible Assets TAS 40 (revised 2009) Investment Property TFRS 2 Share-Based Payment TFRS 3 (revised 2009) Business Combinations TFRS 5 (revised 2009) Non-current Assets Held for Sale and Discontinued Operations TFRS 6 Exploration for and Evaluation of Mineral Resources TFRIC 15 Agreements for the Construction of Real Estate

3.2 Accounting standards that are effective for fiscal years beginning on or after 1 January 2013: TAS 12 Income Taxes TAS 20 (revised 2009) Accounting for Government Grants and Disclosure of Government Assistance TAS 21 (revised 2009) The Effects of Changes in Foreign Exchange Rates

The Company’s management believes that these accounting standards will not have any significant impact on the financial statements for the year when they are initially applied, except for the following accounting standards which management expects the impact on the financial statements in the year when they are adopted.

ANNUAL REPORT 2010 PROPERTY PERFECT 115 TAS 19 Employee Benefits This accounting standard requires employee benefits to be recognised as expense in the period in which the service is performed by the employee. In particular, an entity has to evaluate and make a provision for post-employment benefits or liabilities arising from other defined benefit plans using actuarial techniques. Currently, the Company accounts for such employee benefits when they are incurred. At present, the management is evaluating the impact on the financial statements in the year when this standard is adopted. TAS 12 Income Taxes This accounting standard requires an entity to identify temporary differences, which are differences between the carrying amount of an asset or liability in the accounting records and its tax base, and to recognize deferred tax assets and liabilities under the stipulated guidelines. At present, the management is evaluating the impact on the financial statements in the year when this standard is adopted. 4. Significant accounting policies 4.1 Revenues recognition Revenues from sales of land and houses / residential condominium units / land Revenues from sales of land and houses / residential condominium units / land are recognized as revenues when the ownership has been transferred to the buyer. Interest income Interest income is recognized on an accrual basis based on the effective interest rate. Dividend receivables Dividend receivables are booked as revenue when the company is entitled to dividends. 4.2 Cost of sales of land and houses / residential condominium units / land In determining the cost of sales of land and houses / residential condominium units / land, the anticipated total development costs (after recognizing the costs incurred to date) are attributed to units already sold on the basis of the salable area and then recognized as costs in the income statement. 4.3 Cash and cash equivalents Cash and cash equivalents consist of cash in hands, cash at banks, and all highly liquid investments with an original maturity of three months or less and not subject to withdrawal restrictions. 4.4 Trade accounts receivable Trade accounts receivable are stated at the net realizable value. Allowance for doubtful accounts is provided for the estimated losses that may be incurred in collection of receivables. The allowance is generally based on collection experiences and analysis of debt aging. 4.5 Project development costs Project development costs are stated at cost less allowance for loss on diminution in value of projects. Project development costs consist of the costs of land, land development, construction and related interest. 4.6 Borrowing costs Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective assets. All other borrowing costs are expensed in the period they are incurred. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.

116 PROPERTY PERFECT ANNUAL REPORT 2010 4.7 Advances for purchases of land Advances for purchases of land will be recognized as part of land costs when the title to the related land is transferred to the Company and its subsidiaries. 4.8 Property, plant and equipment and depreciation Property, plant and equipment are stated at cost less accumulated depreciation and allowance for loss on impairment of assets (if any). Depreciation of plant and equipment is calculated by reference to their costs on the straight-line basis over the estimated useful lives: Office buildings and clubhouses 10 and 20 Years Furniture and equipment for offices and clubhouses 5 Years Motor vehicles 5 Years Others 5 Years Depreciation is included in determining income. No depreciation has been provided on land and construction in progress. An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on disposal of an asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the income statement when the asset is derecognised. 4.9 Leasehold rights and amortization / Leasehold rights awaiting sale Leasehold right is stated at cost less accumulated amortization and allowance for loss on impairment of assets (if any). Amortization of leasehold right is calculated by reference to its cost on a straight-line basis over the leasehold period. Amortisation is included in determining income and is capitalised as part of project costs for leasehold rights of project under development. Leasehold rights awaiting sale is stated at the lower of cost and net realizable value. 4.10 Investments A) Investments in securities held for trading are stated at fair value. Changes in the fair value of these securities are recorded as gains or losses in the income statement. B) Investments in available-for-sale securities are stated at fair value. Changes in the fair value of these securities are recorded as a separate item in shareholders’ equity, and will be recorded as gains or losses in the income statement when the securities are sold. C) Investments in non-marketable equity securities, which the Company classified as other investments, are stated at cost net of allowance for loss on impairment (if any). D) Investment in associate is accounted for in the consolidated financial statements using the equity method. E) Investments in subsidiaries and associate are accounted for in the separate financial state- ments using the cost method. The fair value of marketable securities is based on the latest bid price of the last working day of the year. The fair value of unit trusts is determined from their net asset value. The weighted average method is used for computation of the cost of investments. In the event the Company reclassifies investments from one type to another, such investments will be readjusted to their fair value as at the reclassification date. The difference between the carrying amount of the investments and the fair value on the date of reclassification are recorded as gains or losses in the income statement or recorded as surplus (deficit) from changes in the value of investments in shareholders’ equity, depending on the type of investment that is reclassified.

ANNUAL REPORT 2010 PROPERTY PERFECT 117 On disposal of an investment, the difference between net disposal proceeds and the carrying amount of the investment is recognised as income or expenses in the income statement. and loss statement. 4.11 Related party transactions Related parties comprise enterprises and individuals that control, or are controlled by, the Company, whether directly or indirectly, or which are under common control with the Company. They also include associate and individuals which directly or indirectly own a voting interest in the Company that gives them significant influence over the Company, key management personnel, directors and officers with authority in the planning and direction of the Company’s operations. 4.12 Unsubordinated convertible debentures Unsubordinated convertible debentures are classified into liability and equity components and these are presented separately in the balance sheets. In separately presenting such components, the Company determines the liability component by discounting the stream of future payments of principal and interest at the prevailing market rate, while the carrying amount of the equity component is determined by deducting the liability component from the total face value of the unsubordinated convertible debentures and amortizing the difference over the life of the debentures. 4.13 Impairment of assets At each reporting date, the Company and its subsidiaries perform impairment reviews in respect of the property, plant and equipment whenever events or changes in circumstances indicate that an asset may be impaired. An impairment loss is recognized when the recoverable amount of an asset, which is the higher of the asset’s fair value less costs to sell and its value in use, is less than the carrying amount. In determining value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs to sell, an appropriate valuation model is used. These calculations are corroborated by a valuation model that, based on information available, reflects the amount that the Company and its subsidiaries could obtain from the disposal of the asset in an arm’s length transaction between knowledgeable, willing parties, after deducting the costs of disposal. An impairment loss is recognized in the income statement. 4.14 Employee benefits Salaries, wages, bonuses and contributions to the social security fund and provident fund are recognized as expenses when incurred. 4.15 Provisions Provisions are recognized when the Company and its subsidiaries have a present obligation as a result of a past event, they are probable that outflow of resources embodying economic benefits will be required to settle the obligation, and reliable estimate can be made of the amount of the obligation. 4.16 Income Tax The company books income taxes accordingly to the amount to be paid to the Revenue Department, based on the official tax rates.

118 PROPERTY PERFECT ANNUAL REPORT 2010 5. Significant accounting judgments and estimates The preparation of financial statements in conformity with generally accepted accounting principles at times requires management to make subjective judgments and estimates regarding matters that are inherently uncertain. These judgments and estimates affect reported amounts and disclosures and actual results could differ. Significant judgments and estimates are as follows: Leases In determining whether a lease is to be classified as an operating lease or finance lease, the management is required to use judgment regarding whether significant risk and rewards of ownership of the leased asset has been transferred, taking into consideration terms and conditions of the arrangement. Allowance for doubtful accounts In determining an allowance for doubtful accounts, the management needs to make judgment and estimates based upon, among other things, past collection history, aging profile of outstanding debts and the prevailing economic condition. Fair value of financial instruments In determining the fair value of financial instruments that are not actively traded and for which quoted market prices are not readily available, the management exercise judgment, using a variety of valuation techniques and models. The input to these models is taken from observable markets, and includes consideration of liquidity, correlation and longer-term volatility of financial instruments. Impairment of equity investments The Company treats available-for-sale investments and other investments as impaired when the management judges that there has been a significant or prolonged decline in the fair value below their cost or where other objective evidence of impairment exists. The determination of what is “significant” or “prolonged” requires judgment. Property plant and equipment/Depreciation In determining depreciation of plant and equipment, the management is required to make estimates of the useful lives and salvage values of the Company’s and its subsidiaries’ plant and equipment and to review estimate useful lives and salvage values when there are any changes. In addition, the management is required to review property, plant and equipment for impairment on a periodical basis and record impairment losses in the period when it is determined that their recoverable amount is lower than the carrying amount. This requires judgments regarding forecast of future revenues and expenses relating to the assets subject to the review. Project development costs estimation In recognizing revenue from real estate sales, the Company and its subsidiaries need to estimate all project development costs, including land costs, land improvement costs, design costs, construction costs, and borrowing costs for construction. The management estimates these costs based on their business experience and revisit the estimation on a periodical basis or when the actual costs incurred significantly vary from the estimation. Provision for unconverted debentures In recording provision for unconverted debentures, the management projects the exercise of the rights to convert the debentures to ordinary shares based on the tenor of the debentures, the Company’s market share price and current economic conditions. The estimation is reviewed whenever circumstances change. Provision for loss arising from minimum revenue guarantee In recording provision for loss arising from minimum revenue guarantees, the management estimates the cost of the expenses expected to be incurred as a result of providing minimum revenue guarantees based on the present value of the cash flows to be paid to the Fund, calculated on the basis of assumptions that are appropriate to the current operating results and circumstances of the Fund. The estimate is reviewed whenever circumstances changes. ANNUAL REPORT 2010 PROPERTY PERFECT 119 Litigations A subsidiary has contingent liabilities as a result of litigations. The subsidiary’s management has used judgement to assess the results of the litigations and believes that no loss will result. Therefore no contingent liabilities are recorded as at the balance sheet date. 6. Related party transactions During the years, the Company and its subsidiaries had significant business transactions with related parties. Such transactions, which are summarized below, arose in the ordinary course of business and were concluded on commercial terms and bases agreed upon between the Company and those related parties.

(Unit: million baht) Consolidated Separate financial statements financial statements 2010 2009 2010 2009 Pricing policy Transactions with subsidiaries (Eliminated from the consolidated financial statements) Revenues from sales of land and house - - 26.3 - By agreement Revenue from sale of leasehold rights - - 65.0 - By agreement Interest income - - 47.1 41.9 5.38-9.37% per annum Purchase of land - - 5.0 - By agreement Clubhouse management expenses - - 12.8 11.4 By agreement

The balances of the accounts as at 31 December 2010 and 2009 between the Company and those related companies are as follows: (Unit: Thousand Baht) Consolidated Separate financial statements financial statements 2010 2009 2010 2009 Advances to related company Bright Development Bangkok Company Limited - - 1,500 1,500 Advances to related company - - 1,500 1,500

Loans to related companies and interest receivable Loans to subsidiaries Estate Perfect Company Limited - - 460,977 311,606 Bright Development Bangkok Company Limited - - 797,522 428,294 Centre Point Shopping Mall Company Limited - - 24,426 15,200 - - 1,282,925 755,100 Interest receivable Estate Perfect Company Limited - - 13,021 5,308 Bright Development Bangkok Company Limited - - 11,732 30,768 Centre Point Shopping Mall Company Limited - - 360 865 - - 25,113 36,941 Loans to related companies and interest receivable, net - - 1,308,038 792,041

120 PROPERTY PERFECT ANNUAL REPORT 2010 (Unit: Thousand Baht) Consolidated Separate financial statements financial statements 2010 2009 2010 2009 Amounts due to related companies Perfect Sport Club Company Limited (Formerly: Perfect Satellite Services Company Limited) - - 1,391 1,246 Centre Point Shopping Mall Company Limited - - - 80,000 Bright Development Bangkok Company Limited - - 50 - Amounts due to related companies - - 1,441 81,246

Advance from director Director 80,000 - - Advance from director 80,000 - -

During the year 2010, movements of loans to related companies were as follow: (Unit: Thousand Baht) Balance as at During the year Balance as at 1 January 31 December 2010 Increase Decrease 2010 Subsidiaries Estate Perfect Company Limited 311,606 620,000 (470,629) 460,977 Bright Development Bangkok Company Limited 428,294 1,032,500 (663,272) 797,522 Centre Point Shopping Mall Company Limited 15,200 20,000 (10,774) 24,426 Residence Number Nine Company Limited - 68,000 (68,000) -

As discussed in Note 12 to the financial statements, in 2010, the Company paid up additional share capital of Estate Perfect Company Limited and Bright Development Bangkok Company Limited amounting to Baht 200 million and Baht 499 million, respectively. The Company recorded the additional payments for share capital as a deduction against loans and interest receivable of these two companies, comprising loan amounting to Baht 190.6 million and interest receivable amounting to Baht 9.4 million of Estate Perfect Company Limited, and loan amounting to Baht 463.3 million and interest receivable amounting to Baht 35.7 million of Bright Development Bangkok Company Limited. Directors’ and management’s remuneration In 2010 the Company and its subsidiaries paid salaries, bonuses, meeting allowances and gratuities to their directors and management totaling Baht 90.2 million (Separate financial statements: Baht 71.5 million) (2009: Baht 71.5 million (Separate financial statements: Baht 56.2 million)). Guarantee obligations with related parties The Company has outstanding guarantee obligations with its related parties, as described in Note 34.4 a) to the financial statements.

7. Cash and cash equivalents (Unit: Baht) Consolidated Separate financial statements financial statements 2010 2009 2010 2009 Cash 2,113,895 1,373,147 1,530,320 1,314,867 Bank deposits 2,015,739,690 739,212,939 1,583,770,863 667,224,506 Total 2,017,853,585 740,586,086 1,585,301,183 668,539,373

ANNUAL REPORT 2010 PROPERTY PERFECT 121 As at 31 December 2010, bank deposits in saving accounts and fixed deposits carried interests between 0.125 and 0.50% per annum (2009: between 0.15 and 0.20% per annum). 8. Trade accounts receivable / deposits and cash received in advance Trade accounts receivable balances as at 31 December 2010 and 2009 are detailed below. (Unit: Baht) Consolidated Separate financial statements financial statements 2010 2009 2010 2009 Total value of contracts signed 65,030,462,476 55,019,352,991 58,030,636,464 50,691,609,835 Percentage of total project sale value 60.05 59.13 68.84 60.39 Installments due 61,637,161,329 53,042,354,574 56,520,551,867 49,115,224,716 Less: Cash received (61,605,090,897) (53,001,061,348) (56,497,414,635) (49,077,959,223) Installments receivable 32,070,432 41,293,226 23,137,232 37,265,493 Less: Allowance for doubtful debts (10,293,299) (11,193,299) (10,293,299) (11,193,299) Installments receivable, net 21,777,133 30,099,927 12,843,933 26,072,194

Deposits and cash received in advance as at 31 December 2010and 2009 are detailed below. (Unit: Baht) Consolidated Separate financial statements financial statements 2010 2009 2010 2009 Installments due 61,637,161,329 53,042,354,574 56,520,551,867 49,115,224,716 Less: Accumulated sale recognition (61,550,804,569) (52,934,887,056) (56,488,665,527) (49,026,335,606) Deposits and cash received in advance 86,356,760 107,467,518 31,886,340 88,889,110

As at 31 December 2010 and 2009, trade accounts receivable were classified by aging as follows. (Unit: Baht) Consolidated financial statements As at 31 December 2010 Less than 3 - 6 6 -12 Over 3 months months months 12 months Total Accounts receivable - installments 4,895,516 2,282,757 3,117,480 2,672,800 12,968,553 Accounts receivable at transfer date 958,630 820,000 7,000,000 10,323,249 19,101,879 Total 5,854,146 3,102,757 10,117,480 12,996,049 32,070,432 Less: Allowance for doubtful debts - - - (10,293,299) (10,293,299) Trade accounts receivable, net 5,854,146 3,102,757 10,117,480 2,702,750 21,777,133

(Unit: Baht) Consolidated financial statements As at 31 December 2009 Less than 3 - 6 6 -12 Over 3 months months months 12 months Total Accounts receivable - installments 13,022,427 2,290,000 4,695,000 6,891,500 26,898,927 Accounts receivable at transfer date 2,398,400 - 900,000 11,095,899 14,394,299 Total 15,420,827 2,290,000 5,595,000 17,987,399 41,293,226 Less: Allowance for doubtful debts - - (900,000) (10,293,299) (11,193,299) Trade accounts receivable, net 15,420,827 2,290,000 4,695,000 7,694,100 30,099,927

122 PROPERTY PERFECT ANNUAL REPORT 2010 (Unit: Baht) Separate financial statements As at 31 December 2010 Less than 3 - 6 6 -12 Over 3 months months months 12 months Total Accounts receivable - installments 1,710,816 631,257 792,980 900,300 4,035,353 Accounts receivable at transfer date 958,630 820,000 7,000,000 10,323,249 19,101,879 Total 2,669,446 1,451,257 7,792,980 11,223,549 23,137,232 Less: Allowance for doubtful debts - - - (10,293,299) (10,293,299) Trade accounts receivable, net 2,669,446 1,451,257 7,792,980 930,250 12,843,933

(Unit: Baht) Separate financial statements As at 31 December 2009 Less than 3 - 6 6 -12 Over 3 months months months 12 months Total Accounts receivable - installments 10,568,694 1,647,000 4,030,000 6,875,500 23,121,194 Accounts receivable at transfer date 2,198,400 - 900,000 11,045,899 14,144,299 Total 12,767,094 1,647,000 4,930,000 17,921,399 37,265,493 Less: Allowance for doubtful debts - - (900,000) (10,293,299) (11,193,299) Trade accounts receivable, net 12,767,094 1,647,000 4,030,000 7,628,100 26,072,194 9. Account receivable - land Accounts receivable - land consists of the following: A) An account receivable of Baht 35.5 million from the sale of approximately 371 rai of land to a university, as discussed in Note 10 to the financial statements. The Company will receive payment together with payment for a remaining approximately 29 rai of land which the Company expects to be able to transfer ownership in the first quarter in the year 2011. In addition, the Company deposited cash amounting Baht 100 million to that university as a guarantee of road and utility construction in accordance with details in the agreement. B) An account receivable from the sale of land of Baht 30.9 million, to be paid in installments, with the first installment due on 30 April 2009 and full settlement due within December 2009. However, the debtor requested postponement of payment, such that it would be made in two installments, with the first installment amounting to Baht 4.4 million (the Company received this on 6 November 2009) and the second installment, comprising the balance, to be paid within December 2009. On 11 February 2010, the debtor submitted a capital restructuring plan to the Company and requested further postponement of payment, to be within May 2010. On 30 July 2010, the debtor requested further postponement of payment to be made within September 2010 since it is restructuring its equity. On 3 November 2010, the debtor requested another postponement of payment, to be made within December 2010, since it is processing a loan agreement under a credit facility that has been granted by a bank. The loan agreement is expected to be signed within December 2010. The Company expects it will receive payment from the debtor within March 2011. The Company has not provided allowance for doubtful debts for the balance since the Company’s management believes that it will receive full payment from this debtor.

ANNUAL REPORT 2010 PROPERTY PERFECT 123 10. Project development costs (Unit: Baht) Consolidated Separate financial statements financial statements 2010 2009 2010 2009 Land costs 17,162,610,690 15,236,926,057 14,117,378,122 13,655,486,115 Development costs 8,106,124,673 6,982,854,398 7,081,096,862 6,327,010,680 Construction costs 25,519,493,487 21,492,055,465 23,139,898,404 19,823,025,806 Capitalized interest 4,632,189,637 4,493,432,497 4,279,780,479 4,187,264,425 Total 55,420,418,487 48,205,268,417 48,618,153,867 43,992,787,026 Less: Transferred to cost of sales (43,716,142,054) (37,898,910,477) (40,288,892,473) (35,247,874,548) Transferred to settle debt under rehabilitation plan (1,524,192,396) (1,524,192,396) (1,524,192,396) (1,524,192,396) 10,180,084,037 8,782,165,544 6,805,068,998 7,220,720,082 Less: Allowance for loss on diminution in value of projects (57,087,543) (73,454,194) (55,794,006) (68,807,688) Project development costs, net 10,122,996,494 8,708,711,350 6,749,274,992 7,151,912,394

On 9 September 2009, the Company entered into an agreement to purchase and to sell land of 400 rai with a university at a price of Baht 900 million (having cancelled the agreement to purchase and to sell dated 9 April 2009). Under the agreement, the Company must construct a road in accordance with details in the agreement, establish an education fund amounting to Baht 20 million for the university and comply with conditions stipulated in the agreement. In addition, the Company is to be liable for a fine if the Company defaults on the agreement. During the current year, the Company has transferred the ownership of approximately 371 rai of land to the university and recognised revenue amounting to Baht 835.5 million and cost of sales amounting to Baht 695.8 million. Revenue and costs are recognized in proportion to the amount of land transferred, compared to all land per the agreement, based on the total sales price and total budget based on costs incurred to date, respectively (costs consist of land costs and utility costs per the agreement). The Company is in the process of subdividing the deed to the remaining 29 rai of land and preparing to transfer its own- ership, which it expects to be completed within the first quarter in the year 2011. The Company’s and its subsidiaries’ project land and construction thereon with a net book value of Baht 7,149.9 million as at 31 December 2010 (2009: Baht 6,435.1 million), have been mortgaged with financial institutions as collateral for credit facilities, guarantees and debentures. During the current year, the Company and its subsidiary transferred land held for development to project development costs amounting to Baht 563.3 million (Separate financial statements: Baht 133.0 million). During the current year, the Company and its subsidiary included borrowing costs of Baht 135.1 million as cost of “Project development costs” (Separate financial statements: Baht 83.4 million) (2009: Baht 142.1 million (Separate financial statements: Baht 118.5 million)). Interest is charged at rate of 5.75 - 7.25% per annum (2009: 5.00 - 7.30% per annum). 11. Restricted deposits These represent fixed deposits pledged with the banks to secure credit facilities.

124 PROPERTY PERFECT ANNUAL REPORT 2010 12. Investments in subsidiaries Details of investments in subsidiaries as presented in separate financial statements are as follows: (Unit: Baht) Separate financial statements Company’s name Paid-up capital Cost 2010 2009 2010 2009 Million Million Estate Perfect Company Limited 1,200.0 1,000.0 738,459,056 538,459,056 Perfect Sport Club Company Limited (Formally known as “Perfect Satellite Services 1.0 1.0 999,400 999,400 Company Limited”) Bright Development Bangkok Company Limited 500.0 1.0 499,999,400 999,400 Centrepoint Shopping Mall Company Limited 150.7 1.0 150,699,500 599,500 Residence Number Nine Limited 1,000.0 - 507,000,000 - Total 1,897,157,356 541,057,356

On 13 July 2010, Perfect Satellite Services Company Limited registered a change of its name to “Perfect Sport Club Company Limited”. On 12 November 2009 and 22 January 2010, meetings of the Company’s Board of Directors passed the following significant resolutions: A) Approved an increase in the registered share capital of Bright Development Bangkok Company Limited from Baht 1 million (10,000 ordinary shares with a par value of Baht 100 each) to Baht 500 million (5 million ordinary shares with a par value of Baht 100 each). The Company held all shares. (The Company has paid up the additional share capital in March 2010). B) Approved the purchase of the remaining shares of Centrepoint Shopping Mall Company Limited held by a company, for a total consideration of Baht 400,000 (4,000 ordinary shares with a value of Baht 100 each). This will increase the Company’s shareholding in Centrepoint Shopping Mall Company Limited from 59.99% to 100.00% as a result. (The Company has purchased the shares in April 2010). The excess of the acquisition price over the attributable net book value of this sub sidiary at acquisition date, amounting to Baht 5.9 million, was therefore recorded in shareholders’ equity under the caption of “Excess of investment in subsidiary arising as a result of additional purchase of investment in the subsidiary at a price higher than the net book value of the subsidiary at the acquisition date”. C) Approved an increase in the registered share capital of Centrepoint Shopping Mall Company Limited from Baht 1 million (10,000 ordinary shares with a par value of Baht 100 each) to Baht 500 million (5 million ordinary shares with a par value of Baht 100 each). The Company held all shares. (The Company has paid the called up portion (30%) of the additional share capital in April 2010). D) Approved an increase in the registered share capital of Estate Perfect Company Limited from Baht 1,000 million (100 million ordinary shares with a par value of Baht 10 each) to Baht 1,200 million (120 million ordinary shares with a par value of Baht 10 each). The Company held all shares. (The Company has paid up the additional share capital in March 2010). Residence Number Nine Company Limited On 22 December 2009, the Company entered into the purchase and sale of share agreement with shareholders of Residence Number Nine Limited (“the seller”), in order to purchase all 6 million shares of Residence Number Nine Limited (“Residence”) for a total consideration of Baht 484 million. The Company paid a deposit of Baht 60 million. On 27 January 2010, the Company entered into a memorandum of amendment of the purchase and sale of share agreement with the seller. Residence is to increase its registered share capital from Baht

ANNUAL REPORT 2010 PROPERTY PERFECT 125 600 million (6 million ordinary shares with a par value of Baht 100 each) to Baht 1,000 million (10 million ordinary shares with a par value of Baht 100 each) by issuing new shares to the existing shareholders. The Company is to purchase all 10 million shares for a total consideration of Baht 507 million as detailed below. a) Cash of Baht 277 million, to be paid within the transfer date b) Promissory notes totaling Baht 170 million, with Baht 50 million to be paid within June 2010 (the Company has already made payment for this amount) and Baht 120 million to be paid within March 2011 (the Company made a payment amounting to Baht 5 million in July 2010 and Baht 40 million in November 2010) c) Deposit of Baht 60 million Subsequently, on 2 March 2010, the Company is transferred ownership of these shares from the seller. Therefore, the Company included Residence’s financial statements in its consolidated financial statements as from 2 March 2010. Fair value of the identifiable assets and liabilities as at the acquisition date of investment in subsidiary can be summarised below. (Unit: Baht) Cash and cash equivalents 19,818,461 Project development costs, net 315,594,301 Land held for development, net 164,394,441 Other current assets 7,200,054 Other current liabilities (7,257) Total net assets 507,000,000 Less: Issuing promissory notes for purchase of investment in subsidiary (75,000,000) Less: Deposit for purchase of shares (60,000,000) Cash payment for purchase of investment in subsidiary 372,000,000 Less: Cash and cash equivalents of subsidiary (19,818,461) Net cash payment for purchase of investment in subsidiary 352,181,539 13. Investment in associate 13.1 Details of associate: ((Unit: Baht) Consolidated financial statements Share of income Share from investment Nature of Country of holding Carrying amounts based in associate Company’s name business incorporation percentage on equity method during the year 2010 2009 2010 2009 2010 2009 (%) (%) Krungthep Land Public Property Company Limited development Thailand 20.22 20.22 477,622,798 419,736,574 57,886,223 2,998,095 Total 477,622,798 419,736,574 57,886,223 2,998,095

((Unit: Baht) Separate financial statements Country of Shareholding Company’s name Nature of business incorporation percentage Cost 2009 2008 2009 2008 (%) (%) Krungthep Land Public Company Limited Property development Thailand 20.22 20.22 359,999,240 359,999,240 Total 359,999,240 359,999,240

126 PROPERTY PERFECT ANNUAL REPORT 2010 13.2 Summarized financial information of associate Financial information of the associated company is summarized below: (Unit: Million Baht) Total revenues Net income Paid-up capital Total assets Total liabilities for the years for the years as at as at as at ended ended Company’s name 31 December 31 December 31 December 31 December 31 December 2010 2009 2010 2009 2010 2009 2010 2009 2010 2009 Krungthep Land Public Company Limited 1,780 1,780 6,864 7,800 3,928 4,990 2,077 2,106 108 96

The Company recorded share of income from investment in associate after adjusting the associate’s income, since there are differences in accounting policies in relation to the recognition of revenue from residential condominium units. In accordance with a resolution of the Extraordinary General Meeting of Shareholders No. 1/2008 held on 14 January 2008, on 31 January 2008, Krungthep Land issued and offered 188,806 units of 5-year, name-registered, unsecured convertible debentures with a face value of USD 100 or a total value of USD 18,880,600, to the overseas company. In accordance with the conditions of the convertible debentures, Krungthep Land is to pay interest semi-annually at a rate of not exceeding 3% per annum or a dividend yield (whichever is higher) only in years in which Krungthep Land declares a dividend based on the conditions of the convertible debentures and mature on 31 January 2013. They are convertible upon the listing of Krungthep Land’s shares on the Stock Exchange of Thailand or MAI, or one year from the issue date (whichever is earlier), at a conversion price of Baht 13.85 per ordinary share, on a quarterly basis. If no interest payment is made until the maturity date, Krungthep Land is to redeem the outstanding convertible debentures at a price equal to 1.311651 times the baht equivalent of the face value, with such redemption subject to change dependent upon the interest payment made during the life of the debentures. 14. Other long-term investments (Unit: Baht) Consolidated and separate financial statements 2010 2009 Available-for-sale securities Investments in property funds 54,055,470 53,613,050 Less: Allowance for change in value (3,548,690) (4,750,330) 50,506,780 48,862,720 Trading securities Domestic marketable equity securities 1,800,000 1,800,000 Less: Allowance for change in value (1,058,900) (1,211,560) 741,100 588,440 Other investment Domestic non-marketable equity security 4,275,000 4,275,000 4,275,000 4,275,000 Other long-term investments - net 55,522,880 53,726,160

ANNUAL REPORT 2010 PROPERTY PERFECT 127 15. Land held for development (Unit: Baht) Consolidated financial statements Separate financial statements 2010 2009 2010 2009 Land costs 6,992,078,007 5,147,311,175 5,785,576,691 4,239,195,435 Development costs 149,235,579 118,096,031 145,337,859 116,433,096 Construction costs 20,059,168 17,449,523 20,059,168 17,449,523 Capitalized interest 478,378,519 487,540,431 478,378,519 487,540,431 Total 7,639,751,273 5,770,397,160 6,429,352,237 4,860,618,485 Less: Transferred to cost of sales (350,701,624) (350,701,624) (350,701,624) (350,701,624) Transferred to restructure debt (1,540,946,166) (1,540,946,166) (1,540,946,166) (1,540,946,166) Transferred to settle debt under rehabilitation plan (151,117,368) (151,117,368) (151,117,368) (151,117,368) 5,596,986,115 3,727,632,002 4,386,587,079 2,817,853,327 Less: Allowance for loss on impairment (104,000,946) (103,990,228) (108,992,523) (103,990,228) Land held for development, net 5,492,985,169 3,623,641,774 4,277,594,556 2,713,863,099

The land held for development with a net book value of Baht 3,901.5 million as at 31 December 2010 (2009: Baht 2,491.7 million) has been mortgaged with the financial institutions as collateral for credit facilities, guarantees and debentures. During the current year, the Company and its subsidiary transferred land held for development to project development costs amounting to Baht 563.3 million (Separate financial statements: Baht 133.0 million). 16. Advances for purchases of land (Unit: Baht) Consolidated financial statements Separate financial statements 2010 2009 2010 2009 Balance as at 31 December 2008 128,775,752 476,159,648 79,020,752 388,904,213 Increase during the year 509,497,698 112,053,552 339,411,448 63,798,552 Title of plots of land transferred during the year (83,632,050) (459,437,448) (63,882,050) (373,682,013) Transfer of advances for purchases of land to the subsidiary. - - (6,000,000) - Balance as at 31 December 2009 554,641,400 128,775,752 348,550,150 79,020,752

Approximately Baht 423.7 million (Separate financial statements: Baht 262.1 million) of the above balance represented advances paid to landowners by the Company and its subsidiaries under agreements to purchase and to sell land already signed with the landowners by agents, the Company and its subsidiaries. The remaining advances, amounting to approximately Baht 130.9 million (Separate financial statements: Baht 86.5 million), have been paid to agents in acquiring land (Baht 90.1 million paid to agents who are employees of the Company and its subsidiary) and agreements to purchase and to sell land are still in the process of being signed with the landowners. As at 31 December 2010, the Company and its subsidiaries were contracted to purchase and to sell land amounting to Baht 2,658.5 million (Separate financial statements: Baht 1,735.2 million).

128 PROPERTY PERFECT ANNUAL REPORT 2010 - 9,099,739 9,099,739 4,143,880 Total 41,987,869 63,170,862 59,645,821 59,645,821 (Unit: Baht) (2,408,994) (4,143,880) (7,626,621) 621,593,607 312,013,827 648,888,612 341,693,881 275,755,846 327,775,046 (12,283,870) ------5,493,623 8,586,267 6,032,536 2,939,891 40,647,771 44,603,804 34,615,235 36,017,537 (1,537,590) (1,537,589) Others ------2,662,831 4,516,807 4,516,807 15,415,975 15,415,975 (2,408,994) (11,153,005) in progress Construction ------223,560 5,304,629 7,263,007 2,181,938 39,787,127 40,010,687 32,524,120 34,706,058 Motor vehicles - - - - - Consolidated financial statements 934,432 31,457,368 65,668,355 58,221,914 24,431,991 (4,862,610) (4,349,242) 179,018,225 206,547,415 120,796,311 140,879,060 equipment clubhouses Furniture and for offices and - 2,150,487 3,703,328 3,703,328 3,031,720 10,218,573 87,820,180 30,092,001 (4,771,510) (1,739,790) (3,031,720) Office 286,117,880 173,839,711 293,715,430 195,265,980 116,172,391 buildings and clubhouses ------5,396,411 5,396,411 1,112,160 60,606,629 54,098,058 59,494,469 59,494,469 (1,112,160) (1,112,160) Land Additions Transfer to project development costs Cost 31 December 2009 Disposals Depreciation for the years as included in administrative expenses 2009 2010 Transfer in (out) Accumulated depreciation 31 December 2009 31 December 2010 31 December 2010 Depreciation for the year Net book value 31 December 2009 Depreciation on disposals Write-off during the year 31 December 2010 31 December 2010 Increase during the year Allowance for loss on impairment 31 December 2009 17. Property, plant and equipment

ANNUAL REPORT 2010 PROPERTY PERFECT 129 - 9,099,739 9,099,739 4,143,880 Total 22,109,303 53,965,841 48,309,262 48,309,262 (Unit: Baht) (2,408,994) (4,143,880) (7,141,677) 538,254,721 546,179,653 252,477,758 243,434,571 290,676,270 284,602,156 (11,775,377) ------534,900 3,726,331 5,705,396 2,513,964 32,393,829 31,391,139 26,688,433 27,664,808 (1,537,590) (1,537,589) Others ------2,325,282 3,687,177 3,687,177 14,161,323 14,161,323 (2,408,994) (10,390,434) in progress Construction ------214,000 962,837 1,563,832 2,312,669 33,453,939 33,667,939 31,141,270 32,104,107 Motor vehicles - - - - - Separate financial statements 171,862 19,035,121 46,006,319 18,675,141 45,964,296 (4,354,117) (3,864,298) 153,873,346 168,726,212 107,909,050 122,719,893 equipment Furniture and for offices and - - 3,703,328 3,703,328 3,031,720 and 10,218,572 77,695,818 26,157,320 (4,771,510) (1,739,790) (3,031,720) Office 243,765,655 249,212,717 143,396,041 163,038,117 102,113,348 buildings ------5,396,411 5,396,411 1,112,160 60,606,629 59,494,469 54,098,058 59,494,469 (1,112,160) (1,112,160) Land Transfer to project development costs Additions Disposals Cost 31 December 2009 Transfer in (out) Accumulated depreciation 31 December 2009 Depreciation for the years as included in administrative expenses 2009 2010 31 December 2010 Depreciation for the year 31 December 2010 Net book value 31 December 2009 Depreciation on disposals Write-off during the year 31 December 2010 31 December 2010 Increase during the year Allowance for loss on impairment 31 December 2009

130 PROPERTY PERFECT ANNUAL REPORT 2010 As at 31 December 2010, certain plant and equipment items had been fully depreciated but were still in use. The original cost of those assets amounted to approximately Baht 145.5 million (2009: Baht 105.4 million) (Separate financial statements: Baht 132.4 million (2009: Baht 94.3 million)). 18. Leasehold rights / Leasehold rights/Leasehold rights awaiting sale (Unit: Baht) Consolidated financial Separate financial statements statements Cost 31 December 2009 346,767,125 92,000,000 Additions 64,033,319 - 31 December 2010 410,800,444 92,000,000 Accumulated amortisation 31 December 2009 39,118,147 39,118,147 Amortisation for the year 8,526,938 3,211,095 31 December 2010 47,645,085 42,329,242 Allowance for impairment 31 December 2009 189,843,897 - 31 December 2010 189,843,897 - Net book value 31 December 2009 117,805,081 52,881,853 31 December 2010 173,311,462 49,670,758 Amortisation for the years 2009 (included in administrative expenses) 3,211,095 3,211,095 2010 (Baht 5.3 million included in project development costs, and the balance in administrative expenses) 8,526,938 3,211,095

The outstanding balance comprises leasehold rights to approximately 11 rai of land, of which the Company subleased 4 rai for the remainder of the lease period. The sublessee made an advance payment and paid annual rental at rates stipulated in the contract. The Company recognises the advance lease payment over the period of the sublease contract. On 25 December 2007, the Company entered into an agreement to transfer leasehold rights to a subsidiary, with a contract value of Baht 200 million, of which Baht 80 million was paid on the contract date. The remaining balances are to be paid by the subsidiary on the date the transfer of leasehold rights is registered. On 27 June 2008, the Company entered into an amended agreement to transfer leasehold rights to the subsidiary, whereby it is to make the remaining payment to the Company on the date the transfer of leasehold rights is registered, and no later than 30 September 2009. On 26 June 2009, the agreement has been amended to extend the settlement date to be no later than 31 December 2009. Subsequently, on 22 January 2010, a meeting of the Company’s Board of Directors passed a resolution to cancel the above agreement, return Baht 80 million to a director of the subsidiary and approve the transfer of the leasehold rights to a subsidiary at a price of Baht 65 million. The Company transferred the leasehold rights to the subsidiary in April 2010. In addition, the term of the leasehold rights was extended to the year 2036, with an extension fee amounting to Baht 60 million and leasehold fees over the period amounting to Baht 126.3 million.

ANNUAL REPORT 2010 PROPERTY PERFECT 131 19 Note payable A subsidiary issued promissory notes to pay land costs and other expenses to a land owner, who is a land broker. The promissory notes are due, no later than 4 March 2010 and have no interest charges, and are avaled by a financial institution. The aval is secured by a guarantee provided by the Company and the mortgage of the subsidiary’s project land. During the current year, the Company made a payment for the promissory note. The Company issued promissory notes totaling Baht 170 million in order to purchase investment in a subsidiary, as discussed in Note 12 to the financial statements, with Baht 50 million to be paid within June 2010 (During the current year, the Company has already made payment) and Baht 120 million to be paid within March 2011 (During the current year, the Company made payment of promissory notes amounting to Baht 45 million). As at 31 December 2010, the Company had the outstanding balance of note payable amounting to Baht 75 million. 20 Bills of exchange payable The meeting of the Company’s Board of Directors held on 12 November 2010 passed a resolution to stipulate that the revolving bills of exchange are to total not more than Baht 3,000 million at any time. The bills of exchange are subject to interest at a rate of 4.6 - 5.0% per annum and are to be repaid within February to June 2011. 21 Debentures (Unit: Thousand Baht) Consolidated Separate financial statements financial statements 2010 2009 2010 2009 Secured debentures - Subsidiary - 187,150 - - Secured debentures No. 1/2009 - 506,776 - 506,776 Secured debentures No. 2/2009#1 300,000 300,000 300,000 300,000 Secured debentures No. 2/2009#2 800,000 800,000 800,000 800,000 Secured debentures No. 1/2010 1,478,215 - 1,478,215 - Unsecured debentures No. 1/2010 500,000 - 500,000 - Secured debentures No. 2/2010 1,000,000 - 1,000,000 - Secured debentures No. 3/2010 1,000,000 - 1,000,000 - Unsecured debentures No. 4/2010 1,500,000 - 1,500,000 - Total 6,578,215 1,793,926 6,578,215 1,606,776 Less: Current portion (800,000) (187,150) (800,000) - Debentures - net of current portion 5,778,215 1,606,776 5,778,215 1,606,776

The Company The Annual General Meeting of the Company’s shareholders held on 21 June 2006 and 30 April 2008 passed resolutions to approve the issue and offer of not more than Baht 3,200 million secured or unsecured debentures. The Company issued and offered the debentures under this solution as follows: • On 3 June 2009, the Company issued and offered 520,000 secured debentures No. 1/2009 with a par value of Baht 1,000 each, or a total value of Baht 520 million. The debentures mature on 3 June 2012, bear interest at a rate of 6% per annum and are secured by the mortgage of parts of the Company’s project land and construction and a guarantee provided by a financial institution for debentures of Baht 260 million. During the current year, the Company redeemed the debentures.

132 PROPERTY PERFECT ANNUAL REPORT 2010 • On 14 August 2009, the Company issued and offered 300,000 secured debentures No. 2/2009#1 with a par value of Baht 1,000 each, or a total value of Baht 300 million. The debentures mature on 14 February 2011, bear interest at a rate of 4.85% per annum and are secured by the mortgage of parts of the Company’s project land and construction. • On 14 August 2009, the Company issued and offered 800,000 secured debentures No. 2/2009#2 with a par value of Baht 1,000 each, or a total value of Baht 800 million. The debentures mature on 14 August 2012, bear interest at a rate of 6% per annum and are secured by the mortgage of parts of the Company’s project land and construction. • On 26 February 2010, the Company and offered 1,500,000 secured debentures No. 1/2010 with a par value of Baht 1,000 each, or a total value of Baht 1,500 million. The debentures mature on 26 February 2013, bear interest at a rate of 5.9% per annum and are secured by the letter of guarantee provided by a financial institution of Baht 975 million. The Annual General Meeting of the Company’s shareholders held on 30 April 2010 passed the following resolutions: A) Approved the cancellation of the issue and offer of the remaining Baht 80 million debentures as previously approved by the 2008 Annual General Meeting of the Company’s shareholders held on 30 April 2008. B) Approve the issue and offer of not more than Baht 4,000 million secured or unsecured debentures and/or the equivalent in another currency.

During the year 2010, the Company issued and offer the debentures as follows: • On 26 August 2010, the Company issued and offered 500,000 unsecured debentures No. 1/2010 with a par value of Baht 1,000 each, or a total value of Baht 500 million. The debentures mature on 20 May 2011, bear interest at a rate of 4.65% per annum. • On 9 September 2010, the Company issued and offered 1,000,000 secured debentures No. 2/2010 with a par value of Baht 1,000 each, or a total value of Baht 1,000 million. The debentures mature on 9 March 2012, bear interest at a rate of 5.5% per annum and are secured by the mortgage of parts of the Company and subsidiary’s project land and construction. • On 18 November 2010, the Company issued and offered 1,000 secured debentures No. 3/2010 with a par value of Baht 1,000 each, or a total value of Baht 1,000 million. The debentures mature on 18 November 2013, bear interest at a rate of 5.8% per annum and are secured by the mortgage of parts of the Company’s project land and construction. • On 18 November 2010, the Company issued and offered 1,500,000 unsecured debentures No. 4/2010 with a par value of Baht 1,000 each, or a total value of Baht 1,500 million. The debentures mature on 18 November 2012, bear interest at a rate of 6.5% per annum. The meeting of the Company’s debenture holder held on 11 August 2010 approved a resolution to change the redemption date for the secured debentures 1/2009 from 3 June 2012 to 3 September 2010. During the current year, the Company redeemed the debentures and also redeemed its land from mortgage.

The subsidiary On 18 August 2008, Bright Development Bangkok Company Limited (“Bright”), a subsidiary, issued and offered 462,150 secured debentures with a par value of Baht 1,000 each, or a total value of Baht 462,150,000 to a financial institution, as previously approved by the Extraordinary General Meeting of shareholders held on 15 May 2007. The debentures mature on 28 November 2008, bear interest at a rate of THBFIX plus 5.55256% per annum and are secured by a guarantee provided by the Company, the mortgage of parts of the Company and Bright’s project land and construction and the pledge of ordinary shares of Bright held by the Company.

ANNUAL REPORT 2010 PROPERTY PERFECT 133 On 27 May 2009, Bright entered into an amendment to the agreement with a financial institution, amending the details of the debentures, so that the debentures are to be paid in installments, are to be paid in full within February 2010, and bear interest at a rate of THBFIX plus 8.55256% per annum until November 2009 and interest at a rate of THBFIX plus 10.05256% per annum during December 2009 and February 2010. During the current year, Bright Development Bangkok Company Limited redeemed the debentures and also redeemed land from mortgage. Under the debenture agreement, there are normal covenants relating to various matters as required in the normal course of business. 22. Creditors per rehabilitation plan During the current year, the Company made payments to creditors amounting to Baht 229 million. The Company is in the process of arranging for the creditors to receive settlement of the remaining amount of Baht 37 million. 23. Unsubordinated convertible debentures In accordance with a resolution of the Extraordinary General Meeting of shareholders held on 19 September 2005, on 25 November 2005, the Company issued and offered 200,000 unsubordinated convertible debentures with a par value of USD 100 each, or a total value of USD 20 million, to an overseas company. The debentures have been convertible since 25 May 2008, mature in 25 November 2010, and bear interest at a rate of 3.50% per annum. The conversion price is Baht 6.25 per ordinary share, and the debentures are convertible in a ratio of 1 debenture per 658.4 ordinary shares. Those debentures which are not converted will be redeemed at USD 131.60 per unit, using a stipulated exchange rate of Baht 41.15 per USD. The Company recorded the provision for debentures which are not converted over the life of debentures and presented it as a separate item under the heading “provisions” in balance sheet. In the current year, the company redeemed all the unsubordinated convertible debentures and booked Bt23,535,270 gain from the accounting adjustment as share premium. (Detail appears in Note to Financial Statements No.26). The Extraordinary General Meeting of the Company’s shareholders No.1/2008, held on 20 June 2008, passed a resolution regarding unsubordinated convertible debentures, as follows: a) Approved the cancellation of the issue and offer of the USD 15 million unsubordinated convertible debentures as previously approved by the Extraordinary General Meeting of the Company’s shareholders No.1/2005 held on 19 September 2005 (The Company was approved to issue and offer USD 35 million unsubordinated convertible debentures which were issued by USD 20 million as discussed above). b) Approved the issue and offer of not more than USD 30 million of unsubordinated convertible debentures, or the equivalent of not more than Baht 1,000 million, as detailed below. Term : Not over 5 years from the issue date Unit price : USD 100,000 Interest rate : Not over 5% per annum Conversion price : Not less than 110% of average closing price of the Company’s shares during the 7 - 15 consecutive working days before the offer date, and not less than Baht 6.50 per share Allocation method : To overseas institutional investors or local institutional investors However, the Company’s management is authorized to stipulate or amend details of the method and conditions of the issue and offer of the unsubordinated convertible debentures, such as offering price, conversion price, unit price, interest rate, exercise period, termination date of conversion and redemption price. Currently, the Company’s management is considering the details of the issue and offer of these unsubordinated convertible debentures

134 PROPERTY PERFECT ANNUAL REPORT 2010 Security The guarantee of the Company’s director and the The guarantee of the Company’s director and and land project Company’s the of part of mortgage construction. The guarantee of other company and the Company’s The guarantee of other company and the Company’s project Company’s the of part of mortgage the and director in the Company and the shares land and construction held by a shareholder and shares of other company. The mortgage of part of the Company’s project land land project Company’s the of part of mortgage The and construction. The guarantee of Company’s director and the mortgage construction. and land project Company’s the of part of The guarantee of the mortgage of part of the Company’sthe of part of mortgage the of guarantee The project land and construction. Company’sthe of part of mortgage the of guarantee The project land and construction. Repayment period Repaying each time a plot of land with house is redeemed from mortgage, at a rate of not less than 65% of the selling price, The bank. the to informed amount the than less be to not is which Company made payments in full 2010. Repaying each time a plot of land with house is redeemed from be to not is which price, selling the of 65% of rate a at mortgage, made The Company less than the amount informed to bank. payments in full 2010. Repaying each time a plot of land with townhouse is redeemed price. selling the of 80% than less not of rate a at mortgage, from The Company made payments in full 2010. Repaying each time a plot of land with house is redeemed from be to not is which price, selling the of 75% of rate a at mortgage, made The Company less than the amount informed to bank. payments in full 2010. Repaying each time a plot of land with house is redeemed from The price. selling the of 80% than less not of rate a at mortgage, Company made payments in full 2010. Repaying each time a plot of land with house is redeemed from mortgage, at a rate of not less than 65% of the selling price, Any bank. the to informed amount the than less be to not is which remaining balance is to be repaid within May 2013. Interest rate Interest at a rate tied to the the to tied rate a at Interest minimum loan rate (MLR) Interest at a rate tied to the the to tied rate a at Interest minimum loan rate (MLR) Interest at a rate tied to the the to tied rate a at Interest minimum loan rate (MLR) Interest at a rate tied to the the to tied rate a at Interest minimum loan rate (MLR) Interest at a rate tied to the the to tied rate a at Interest minimum loan rate (MLR) 17.3 20.7 2009 113.1 160.9 305.3 389.7 Balance - - - - - (Million Baht) 2010 115.4 The Company Long-term loans consist of granted by five financial institutions under the following credit facilities. Long-term loans A facility of Baht 464 million A facility of Baht 1,186 million A facility of Baht 1,501 million A facility of Bahtof facility A 160 million A facility of Bahtof facility A 481 million A facility of Baht 1,578 million

1) 2) 3) 4) 5) 6) 24.

ANNUAL REPORT 2010 PROPERTY PERFECT 135 Security The guarantee of the mortgage of part of the Company’sthe of part of mortgage the of guarantee The project land and construction. The guarantee of the mortgage of part of the Company’sthe of part of mortgage the of guarantee The project land and construction. The guarantee of the mortgage of part of the Company’sthe of part of mortgage the of guarantee The project land and construction. The guarantee of the mortgage of part of the Company’sthe of part of mortgage the of guarantee The project land and construction. The guarantee of the mortgage of part of the Company’sthe of part of mortgage the of guarantee The project land and construction. The guarantee of the mortgage of part of the Company’sthe of part of mortgage the of guarantee The project land and construction. The guarantee of the mortgage of part of the Company’sthe of part of mortgage the of guarantee The project land and construction. The guarantee of the mortgage of part of the Company’sthe of part of mortgage the of guarantee The project land and construction. Repayment period Repaying each time a plot of land with house is redeemed from be to not is which price, selling the of 70% of rate a at mortgage, made The Company less than the amount informed to bank. payments in full 2010. Repaying each time a plot of land with house is redeemed from The price. selling the of 70% than less not of rate a at mortgage, Company made payments in full 2010. Repaying each time a plot of condominium from mortgage, at rate of not less than 70% the selling price. The Company made payments in full 2010. Repaying each time a plot of land with house is redeemed from which price, selling the of 70% than less not of rate a at mortgage, is not to be less than the amount informed bank. Any remain - ing balance is to be repaid within December 2014. Repaying each time a plot of land with house is redeemed from The price. selling the of 70% than less not of rate a at mortgage, Company made payments in full 2010. Repaying each time a plot of land with townhouse is redeemed from mortgage, at a rate of not less than 70% the selling price. The Company made payments in full 2010. Repaying each time a plot of land with house is redeemed from be to not is which price, selling the of 70% of rate a at mortgage, balanceremaining Any bank. the to informed amount the than less is to be repaid within October 2016. Repaying each time a plot of land with house is redeemed from which price. selling the of 60% than less not of rate a at mortgage, is not to be less than the amount informed bank. Any remain - ing balance is to be repaid within August 2012. Interest rate Interest at a rate tied to the the to tied rate a at Interest minimum loan rate (MLR) Interest at a rate 7.00 - 7.25% - 7.00 rate a at Interest per annum Interest at a rate tied to the the to tied rate a at Interest minimum loan rate (MLR) Interest at a rate tied to the the to tied rate a at Interest minimum loan rate (MLR) Interest at a rate 7.0% per an - 7.0% Interest at a rate num Interest at a rate tied to the the to tied rate a at Interest minimum loan rate (MLR) Interest at a rate tied to the the to tied rate a at Interest minimum loan rate (MLR) Interest at a rate tied to the the to tied rate a at Interest minimum loan rate (MLR) - - 35.5 78.7 93.5 2009 168.9 235.0 246.4 (148.7) 1,865.0 1,716.3 Balance ------(Million Baht) 2010 278.1 170.0 252.4 815.9 815.9 A facility of Baht 201 million 317 million 1,000 million 820 million 358 million 360 million A facility of Baht 900 million A facility of Bahtof facility A 670 million current portion

7) 8) A facility of Baht of facility A 8) 9) A facility of Baht of A facility 9) 10)A facility of Baht of facility 10)A 11) A facility of Baht 12) A facility of Baht 13) 14) Total Long-term of net - loans Less: Current portion

136 PROPERTY PERFECT ANNUAL REPORT 2010 Security The guarantee of the Company and subsidiary’s director The guarantee of the Company and subsidiary’s director and the mortgage of part subsidiary’s project land and construction. The guarantee of the Company and the mortgage of part of part of mortgage the and Company the of guarantee The the subsidiary’s project land and construction. of part of mortgage the and Company the of guarantee The the Company’s project land and construction. The guarantee of the Company and the mortgage of part of part of mortgage the and Company the of guarantee The the subsidiary’s project land and construction. The guarantee of the Company and the mortgage of part of part of mortgage the and Company the of guarantee The the subsidiary’s project land and construction. The guarantee of the Company and the mortgage of part of part of mortgage the and Company the of guarantee The the subsidiary’s project land and construction. Repayment period Repaying each time of land and house is redeemed from mort - price, selling the of percent 70 than less not of rate a at gage, which is not to be less than the amount informed to the bank. The subsidiary made payments in full 2010. Repaying each time of land and house is redeemed from mort - price, selling the of percent 70 than less not of rate a at gage, which is not to be less than the amount informed to the bank. 2013. September within repaid be to is balance remaining Any Baht least at made be to is interest and principal Repaying 900,000 each. The subsidiary made payments in full 2010. Repaying each time of land and house is redeemed from Repaying each time of land and house is redeemed from mortgage, at a rate of not less than 75 percent of the selling price, which is not to be less than the amount informed to the 2014. April within repaid be to is balance remaining Any bank. Repaying each time of land and house is redeemed from Repaying each time of land and house is redeemed from mortgage, at a rate of not less than 70 percent the selling price, which is not to be less than the amount informed to the 2013. April within repaid be to is balance remaining Any bank. Repaying each time of land and house is redeemed from Repaying each time of land and house is redeemed from mortgage, at a rate of not less than 75 percent of the selling price, which is not to be less than the amount informed to the 2013. April within repaid be to is balance remaining Any bank. Interest rate Interest at a rate tied to the tied to the at a rate Interest minimum loan rate (MLR) Interest at a rate tied to the tied to the at a rate Interest minimum loan rate (MLR) Interest at a rate tied to the tied to the at a rate Interest minimum loan rate (MLR) Interest at a rate tied to the tied to the at a rate Interest minimum loan rate (MLR) Interest at a rate tied to the tied to the at a rate Interest minimum loan rate (MLR) Interest at a rate tied to the tied to the at a rate Interest minimum loan rate (MLR) - - - 35.6 16.5 2009 220.0 Balance - (Million Baht) 62.8 58.3 2010 293.3 237.8 Long-term loans consist of loans granted by six financial institutions under the following credit facilities. Long-term loans consist of granted by six financial Its subsidiary A facility of Bahtof facility A 720 million A facility of Bahtof facility A 328 million A facility of Bahtof facility A 19.7 million Baht of facility A 560 million A facility of Baht of facility A 277.5 million A facility of Bahtof facility A 260 million

2) 1) 3) 4) 5) 6)

ANNUAL REPORT 2010 PROPERTY PERFECT 137 Security The guarantee of the Company and its subsidiary mort - gage of part the Company’s project land and construction. The guarantee of the Company and its subsidiary mort - gage of part the Company’s project land and construction. The guarantee of the Company and its subsidiary mort - gage of part the Company’s project land and construction. The guarantee of the Company and its subsidiary mort - gage of part the Company’s project land and construction. The guarantee of the Company and its subsidiary mort - gage of part the Company’s project land and construction. Repayment period Repaying each time of land and house is redeemed from Repaying each time of land and house is redeemed from mortgage, at a rate of not less than 65 percent of the selling price, which is not to be less than the amount informed to the 2014. April within repaid be to is balance remaining Any bank. Repaying each time of land and house is redeemed from Repaying each time of land and house is redeemed from mortgage, at a rate of not less than 70 percent the selling price, which is not to be less than the amount informed to the 2012. June within repaid be to is balance remaining Any bank. Repaying each time of land and house is redeemed from Repaying each time of land and house is redeemed from mortgage, at a rate of not less than 70 percent the selling price, which is not to be less than the amount informed to the 2013. May within repaid be to is balance remaining Any bank. Repaying each time of land and house is redeemed from Repaying each time of land and house is redeemed from mortgage, at a rate of not less than 70 percent the selling price, which is not to be less than the amount informed to the 2015. June within repaid be to is balance remaining Any bank. Repaying each time of land and house is redeemed from mort - price, selling the of percent 70 than less not of rate a at gage, which is not to be less than the amount informed to the bank. Any remaining balance is to be repaid within January 2015. Interest rate Interest at a rate tied to the tied to the at a rate Interest minimum loan rate (MLR) Interest at a rate tied to the tied to the at a rate Interest minimum loan rate (MLR) Interest at a rate tied to the tied to the at a rate Interest minimum loan rate (MLR) Interest at a rate tied to the tied to the at a rate Interest minimum loan rate (MLR) Interest at a rate tied to the tied to the at a rate Interest minimum loan rate (MLR) - - - - - 2009 272.1 226.6 (45.5) Balance - (Million Baht) 38.9 82.2 2010 220.0 474.6 150.0 1,617.9 1,617.9 A facility of Bahtof facility A 670 million A facility of Baht of facility A 870 million A facility of Bahtof facility A 184 million A facility of Bahtof facility A 775 million 481 million of current portion current of

7) 8) 9) 10) 11) A facility of Baht Total portion Current Less: Long-term loans - net

138 PROPERTY PERFECT ANNUAL REPORT 2010 The outstanding long-term loans are detailed as follow: (Unit: Million Baht) Consolidated Separate financial statements financial statements 2010 2009 2010 2009 Long-term loans 2,433.8 2,137.1 815.8 1,865.0 Less: Current portion - (194.2) - (148.7) Long-term loans - net of current portion 2,433.8 1,942.9 815.8 1,716.3

The loan agreements contain normal covenants relating to various matters as required in the normal course of business. As at 31 December 2010, the long-term credit facilities of the Company and its subsidiary which have not been drawn down amounted to Baht 6,395.26 million. 25. Provisions These comprise the following: (Unit: Baht) Consolidated and separate financial statements 2010 2009 Provision for loss arising from minimum revenue guarantee 12,739,663 9,557,897 Provision for unconverted debentures - 202,909,469 12,739,663 212,467,366

Movements in provision account during the year ended 31 December 2010 are summarised below. (Unit: Baht) Consolidated and separate financial statements Balance as at 1 January 2010 212,467,366 Revise provision for loss arising from minimum revenue guarantee 35,602,103 Adjust amounts to be paid 4,182,008 Adjust provision for unconverted debentures according to the life of the debentures 57,158,530 Total 309,410,007 Less: Paid for minimum revenue guarantee (36,602,344) Less: Redemption of unsubordinated convertible debentures (260,068,000) Balance as at 31 December 2010 12,739,663

Provision for unconverted debentures The Company recorded the provision for debentures which are not converted over the life of debentures. During the current year, the Company redeemed the unsubordinated convertible debentures.

ANNUAL REPORT 2010 PROPERTY PERFECT 139 Minimum revenue guarantee for the Fund On 28 February 2008, the Company entered into an agreement to transfer the Company’s properties to Property Perfect Property Fund (“the Fund”), for a total consideration of Baht 510 million. Under the agreement, the Company agrees to guarantee minimum annual revenue for the Fund (rental and service revenues before deducting expenses) of Baht 55 million for a period of five years, expiring on 31 December 2012. The guaranteed payment is due within 31 January and 31 July of each year in accordance with conditions as stipulated in the agreement. However, the amount of guaranteed revenue depends on the ratio of the value of the outstanding properties to the value of the properties in which the Fund initially invested, as determined by an appraisal company for the purpose of the initial investment. During the current year, the Company revised provision for loss from such guarantee by Baht 35.6 million (2009: Baht 9.4 million) and recorded it as a separate item under the heading of “Loss arising from minimum revenue guarantee” in the income statements. 26. Share capital/discount on capital stock As at 31 December 2010, the Company’s issued and paid up share capital has increased to Baht 4,726,344,720 (787,724,120 ordinary shares of Baht 6 each), with totaling Baht 15,000 (2,500 ordinary shares of Baht 6 each) being the result of the exercise of warrants in December 2009. The Company registered increase in its capital with the Ministry of Commerce on 13 January 2010.

The Company’s share discount is detailed below. (Unit: Baht) Consolidated and separate financial statements Balance as at 31 December 2009 (44,093,444) Increase from conversion of warrants (14,975) Adjustment of unsubordinated convertible debenture - equity component (Note 23) 23,535,270 Balance as at 31 December 2010 (20,573,149)

Subsequently, the Company registered an increase in its capital of Baht 39,600 (6,600 ordinary shares of Baht 6 each) with the Ministry of Commerce on 13 January 2011, being the result of the exercise of the warrants as discussed in Note 27 to the financial statements. 27. Warrants Units Outstanding as at 31 December 2009 8,870,076 Exercised during the year (6,600) Outstanding as at 31 December 2010 8,863,476

The warrants are to be exercisable in a ratio of 1 warrant to 1 new ordinary share at an exercise price of Baht 0.01 per share and have an exercise period of 10 years from the issue date, 7 November 2002, with stipulated exercise dates of the end of the second and the fourth quarter of each year.

140 PROPERTY PERFECT ANNUAL REPORT 2010 In December 2009, the Company received advance subscription of Baht 0.01 per share to 2,500 of the additional ordinary shares arising from the exercise of the warrants, a total of Baht 25. The Company registered the resulting increase of Baht 15,000 in its capital with the Ministry of Commerce on 11 January 2010. In December 2010, the Company received advance subscription of Baht 0.01 per share to 6,600 of the additional ordinary shares arising from the exercise of the warrants, a total of Baht 66. The Company registered the resulting increase of Baht 39,600 in its capital with the Ministry of Commerce on 13 January 2011. 28. Statutory reserve Pursuant to Section 116 of the Public Limited Companies Act B.E. 2535, the Company is required to set aside to a statutory reserve at least 5% of its net income after deducting accumulated deficit brought forward (if any), until the reserve reaches 10% of the registered capital. The statutory reserve is not available for dividend distribution. 29. Expenses by nature Significant expenses by nature are as follows: (Unit: Baht) Consolidated Separate financial statements financial statements 2010 2009 2010 2009 Salaries, wages and other employee benefits 481,338,217 354,952,860 392,202,742 298,613,287 Depreciation and amortisation 62,856,916 66,381,957 51,520,358 57,176,936 Rental expenses from operating lease agreements 25,737,411 24,659,535 20,849,095 19,900,653 Specific business tax and transfer fees 240,413,712 6,852,456 204,712,654 5,711,150 Marketing expenses 468,278,212 234,882,562 359,045,218 206,634,296 Project management expenses 173,223,560 137,735,628 143,975,647 120,801,582 Loss arising from minimum revenue guarantee 35,602,103 9,422,551 35,602,103 9,422,551 Real estate development during the year 8,947,831,428 5,465,012,086 6,110,746,449 4,425,100,899 Changes in real estate projects (3,283,628,539) (1,540,902,433) (1,161,094,054) (1,195,328,210) Finance cost 600,210,587 428,679,312 543,229,325 349,198,521 30. Earnings per share Basic earnings per share is calculated by dividing net income for the year by the weighted average number of ordinary shares in issue during the year. Diluted earnings per share is calculated by dividing net income for the year by the weighted average number of ordinary shares in issue during the year plus the weighted average number of ordinary shares which would need to be issued to convert all dilutive potential ordinary shares into ordinary shares. The calculation assumes that the conversion took place either at the beginning of the year or on the date the potential ordinary shares were issued.

ANNUAL REPORT 2010 PROPERTY PERFECT 141 The following table sets forth the computation of basic and diluted earnings per share: (Unit: Baht) Consolidated financial statements Weighted average Earnings Net income number of ordinary shares per share 2010 2009 2010 2009 2010 2009 Basic earnings per share Net income attributable to equity holders of the parent 550,436,938 403,627,020 787,724,156 787,721,634 0.699 0.512 Effect of dilutive potential ordinary shares Warrants 8,863,476 units (2009: 8,870,076 units) - - 8,848,948 8,846,962 Diluted earnings per share Net income of ordinary shareholders assuming the conversion of dilutive potential ordinary shares 550,436,938 403,627,020 796,573,104 796,568,596 0.691 0.507

(Unit: Baht) Separate financial statements Weighted average Earnings Net income number of ordinary shares per share 2010 2009 2010 2009 2010 2009 Basic earnings per share Net income attributable to equity 537,698,460 386,325,918 787,724,156 787,721,634 0.683 0.490 holders of the parent Effect of dilutive potential ordinary shares Warrants: 8, 863,476 units (2009: 8,870,076 units) - - 8,848,948 8,846,962 Unsubordinated convertible debentures Diluted earnings per share Net income of ordinary shareholders assuming the conversion of dilutive potential ordinary shares 537,698,460 386,325,918 796,573,104 796,568,596 0.675 0.485

Unsubordinated convertible debentures increased the earning per share in the consolidated and non-consolidated financial statements ended 31 December 2010 and 2009. The company thus did not include the debentures in the dilutive earning per share calculation in the consolidated and non-consolidated financial statements ended 31 December 2010 and 2009. 31. Financial information by segment The Company’s and its subsidiaries’ operations involve principally a single industry segment, property development, and are carried on in the single geographic area of Thailand. As a result, all of the revenues, operating income and assets as reflected in these financial statements pertain to the aforementioned industry segment and geographic area.

142 PROPERTY PERFECT ANNUAL REPORT 2010 32. Provident fund The Company, its subsidiary and their employees have jointly established provident funds in accordance with the Provident Fund Act B.E. 2530. The Company, its subsidiary and their employees contributed to the fund monthly at the rate of 3 - 10% of basic salary. The fund, which is managed by Kasikorn Asset Management will be paid to employees upon termination in accordance with the fund rules. During the current year, the Company and its subsidiary contributed Baht 17.7 million (2009: Baht 16.5 million) (Separate financial statements: Baht 14.6 million (2009: Baht 13.8 million)) to the fund. 33. Dividends

Approved by Total dividends Dividend per share Final dividend for 2009 Annual General Meeting of the shareholders on 30 April 2010 Baht 196.9 million Baht 0.25 Final dividend for 2008 Annual General Meeting of the shareholders on 30 April 2009 Baht 283.5 million Baht0.36 34. Commitments and contingent liabilities 34.1 Capital commitments a) The Company and its subsidiaries had outstanding commitments of approximately Baht 1,310.0 million in respect of construction contracts of land and house projects and residential condominium units of which the Company and its subsidiaries had already entered into contracts with subcontractors. b) The Company and its subsidiaries had outstanding capital commitments of approximately Baht 2,234.8 million in respect of purchases of land. c) The Company and its subsidiary had outstanding commitments of approximately Baht 9.4 million in respect of a construction management contract. d) The subsidiary had outstanding capital commitments of approximately Baht 15.6 million in respect of land lease for real estate development. e) The subsidiary had outstanding commitments of approximately Baht 13.9 million in respect of a design contract for a shopping center and office project. 34.2 Operating lease commitments The Company and its subsidiary have entered into several lease agreements in respect of the lease of land, vehicles, advertising board, office space and various services. The terms of the agreements are generally between 1 and 5 years. Operating lease agreements are non-cancellable. As at 31 December 2010, future minimum lease payments required under these non-cancellable operating lease contracts were as follows. Payable within: Million Baht Less than 1 year 67.4 2 to 5 years 19.3

During the year 2010, the Company and its subsidiaries recognized rental expenses of Baht 25.7 million (Separate financial statements: Baht 20.9 million).

ANNUAL REPORT 2010 PROPERTY PERFECT 143 34.3 Long-term service commitments The Company has entered into clubhouse management agreements with its subsidiary. Under the conditions of these agreements, the Company is to pay monthly service fees as stipulated in the agreements. The fees for the year 2009 amounted to approximately Baht 12.8 million. 34.4 Guarantees a) The Company has guaranteed debentures and bank credit facilities of its subsidiaries amounting to Baht 5,274.7 million. b) As at 31 December 2010, there were outstanding bank guarantees of approximately Baht 1,899.7 million issued by the banks on behalf of the Company and its subsidiary in respect of certain performance bonds as required in the normal course of business. These included letters of guarantee amounting to Baht 924.7 million to guarantee the public utilities and Baht 975.0 million to guarantee the debentures. c) As at 31 December 2010, there was an outstanding letter of guarantee issued by a bank on behalf of the Company to guarantee minimum revenue of the Fund of Baht 55 million per year for a period of 5 years, ending on 31 December 2012. 35. Litigations Outstanding litigations as at 31 December 2010 are detailed below. a) The Company has been sued by a customer seeking compensation of approximately Baht 5.0 million for the breach of conditions of sale and purchase agreement. Currently, the lawsuit is being considered by the civil court. However, the Company believes that it will suffer no significant loss as a result of this litigation. b) A contractor has sued a subsidiary for payment of outstanding construction fees amounting to approximately Baht 7.5 million. However, the subsidiary has countersued the contractor for Baht 8.4 million since the construction fees that the subsidiary paid were for more work than the contractor performed for the subsidiary. The court dismissed the lawsuit brought against the subsidiary but he plaintiff appealed this order. Currently, the lawsuit is being considered by the appeals court. However, the subsidiary believes that it will suffer no significant loss as a result of this litigation. c) A subsidiary has been sued by a customer seeking compensation of approximately Baht 7.7 million for infringement of the plaintiff’s rights. The court of first instance dismissed the lawsuit brought against the subsidiary but the plaintiff appealed this order. Currently, the lawsuit is being considered by the appeals court. However, the subsidiary believes that it will suffer no significant loss as a result of this litigation.

144 PROPERTY PERFECT ANNUAL REPORT 2010 36. Financial instruments 36.1 Financial risk management The Company’s and its subsidiaries’ financial instruments, as defined under Thai Accounting Standard No. 107 “Financial Instruments: Disclosure and Presentations”, principally consist of the following.

Financial assets Financial liabilities - Cash and cash equivalents - Trade accounts payable - Trade accounts receivable, net - Note payable - Account receivable - land - Bill of exchange holders - Retention per agreement - Creditors per rehabilitation plan - Advances to contractors, net - Amounts due to related companies - Restricted deposits - Deposits and cash received in advance - Loans to related companies, net - Debentures - Other long-term investments, net - Long-term loans - Advances for purchases of land - Deposits and cash received in advance for sublease agreement

The financial risks associated with these financial instruments and how they are managed is described below. Credit risk The Company and its subsidiaries are exposed to credit risk primarily with respect to trade ac- counts receivable, account receivable - land, advances and loans. The Company and its subsidiaries manage the risk by adopting appropriate credit control policies and procedures and therefore do not expect to incur material financial losses. In addition, the Company and its subsidiaries do not have high concentration of credit risk involved the real estate business since they have a large customer base. The maximum exposure to credit risk is limited to the carrying amounts of trade accounts receivable, account receivable - land, advances and loans and as stated in the balance sheet. Interest rate risk The Company and its subsidiaries are exposed to interest rate risk relating primarily to their cash at banks, loans, bank overdrafts and short-term loans from financial institutions, loans from other company/ individual, creditors per rehabilitation plan, debentures, unsubordinated convertible debentures and long-term loans. However, since most of the Company’s and its subsidiaries’ financial assets and liabilities bear floating interest rates or fixed interest rates which are close to the market rate, the interest rate risk is expected to be minimal. Significant financial assets and liabilities as at 31 December 2009 classified by type of interest rates are summarized in the table below on the maturity date or, the repricing date if this occurs before the maturity date.

ANNUAL REPORT 2010 PROPERTY PERFECT 145 (Unit: Million Baht) Consolidated Financial Statement Fixed interest rates Floating Non- Interest Within Over interest interest Rate 1 year 1-5 year 5 years rate bearing Total (% p.a) Financial assets Cash and cash equivalents - - - 2,015.8 2.1 2,017.9 0.125 - 0.50 Trade accounts receivable, net - - - - 21.8 21.8 - Account receivable - land - - - - 66.4 66.4 - Retention per agreement - - - - 100.0 100.0 - Advances to contractors, net - - - - 127.6 127.6 - Restricted deposits - - - 18.5 - 18.5 0.25 - 0.50 Other long-term investments, net - - - - 55.5 55.5 - Advances for purchases of land - - - - 554.6 554.6 - - - - 2,034.3 928.0 2,962.3 Financial liabilities Trade accounts payable - - - - 800.7 800.7 - Note payable - - - - 75.0 75.0 - Bills of exchange payable 1,997.3 - - - - 1,997.3 4.60 - 5.00 Creditors per rehabilitation plan - - - - 37.0 37.0 - Deposit and cash received in advance - - - - 86.4 86.4 - Debentures 800.0 5,778.2 - - - 6,578.2 4.65 - 6.50 Long-term loans - - - 2,433.8 - 2,433.8 MLR Deposits and cash received in advance for sublease agreement - - - - 51.4 51.4 - 2,797.3 5,778.2 - 2,433.8 1,050.5 12,059.8

146 PROPERTY PERFECT ANNUAL REPORT 2010 (Unit: Million Baht) Consolidated Financial Statement Fixed interest rates Floating Non- Interest Within Over interest interest Rate 1 year 1-5 year 5 years rate bearing Total (% p.a) Financial assets Cash and cash equivalents - - - 1,583.8 1.5 1,585.3 0.125 - 0.50 Trade accounts receivable, net - - - - 12.8 12.8 - Account receivable - land - - - - 66.4 66.4 - Retention per agreement - - - - 100.0 100.0 - Advances to contractors, net - - - - 96.8 96.8 - Restricted deposits - - - 18.5 - 18.5 0.25 - 0.50 Loans to related companies, net - - - 1,308.0 - 1,308.0 5.38 - 6.13 Other long-term investments, net - - - - 55.5 55.5 - Advances for purchases of land - - - - 348.6 348.6 - - - - 2,910.3 681.6 3,591.9 Financial liabilities Trade accounts payable - - - - 572.7 572.7 - Note payable - - - - 75.0 75.0 - Bill of exchange holders 1,997.3 - - - - 1,997.3 4.60 - 5.00 Creditors per rehabilitation plan - - - - 37.0 37.0 - Amounts due to related companies - - - - 1.4 1.4 - Deposits and cash received in advance - - - - 31.9 31.9 - debentures 800.0 5,778.2 - - - 6,578.2 4.65 - 6.50 Long-term loans - - - 815.9 - 815.9 MLR Deposits and cash received in advance for sublease agreement - - - - 51.4 51.4 - 2,797.3 5,778.2 - 815.9 769.4 10,160.8

36.2 Fair value of financial instruments Since the majority of the Company’s and its subsidiaries’ financial assets and liabilities are short- term or have interest rates close to the market rates. The fair values of these financial assets and liabilities are not expected to differ materially from the amounts presented in the balance sheets. A fair value is the amount for which an asset can be exchanged or a liability settled between knowledgeable, willing parties in an arm’s length transaction. The fair value is determined by reference to the market price of the financial instrument or by using and appropriate valuation technique, depending on the nature of the instrument. 37. Capital management The primary objective of the Company’s capital management is to ensure that it has an appropriate financial structure and preserves the ability to continue its business as a going concern. According to the balance sheet as at 31 December 2010 the Group’s debt-to-equity ratio was 1.75:1 (2009: 1.12:1) and the Company’s was 1.56:1 (2009: 1.04:1).

ANNUAL REPORT 2010 PROPERTY PERFECT 147 38. Subsequent events On 25 February 2011, a meeting of the Company’s Board of Directors passed the following significant resolutions: a) Approved the proposal of the payment of a dividend of Baht 0.33 per share, totaling Baht 259.95 million in respect of the year 2010 income. b) Approved the issue and offer of secured debentures, in an amount not exceeding Baht 4,000 million, having maturity of not more than 5 years. c) Approved the cancellation of the issue and offer of not more than USD 30 million of unsubordinated convertible debentures, or the equivalent of not more than Baht 1,000 million as previously approved by the Extraordinary General Meeting of the Company’s shareholders No.1/2008 held on 20 June 2008. d) Approved the cancellation of Baht 962,434,824 ordinary shares (160,405,804 ordinary shares with a par value of Baht 6 each) as reserved for the conversion of the debentures to ordinary shares as described in c). e) Approved the cancellation of Baht 810,000,000 ordinary shares (135,000,000 ordinary shares with a par value of Baht 6 each) as reserved for the conversion of the debentures to ordinary shares, as previously approved by the Extraordinary General Meeting of the Company’s shareholders No.1/2005 held on 19 September 2005. f) Approved the reduction of the registered share capital from Baht 6,552,000,000 (1,092,000,000 ordinary shares with a par value of Baht 6 each) to Baht 4,779,565,176 (796,594,196 ordinary shares with a par value of Baht 6 each) by canceling unissued shares of the Company as described in d) and e). g) Approved the change of the par value of the Company’s ordinary shares from Baht 6 to Baht 1 per share. h) Approved increase in the registered share capital from Baht 4,779,565,176 (4,779,565,176 ordinary shares with a par value of Baht 1 each) to Baht 5,961,161,256 (5,961,161,256 ordinary shares with a par value of Baht 1 each) by issuing 787,730,720 ordinary shares with a par value of Baht 1 each to offer to the Company’s existing shareholders and issuing 393,865,360 ordinary shares with a par value of Baht 6 each to be reserved for the exercise of the warrants as described in i). i) Approved the issue of the warrants to the Company’s existing shareholders in a ratio of 1 warrant for every 2 new ordinary shares to be offered to the Company’s existing shareholders as described in h), without specifying the offer price. Details are as follows: No. of warrants (unit) 393,865,360 Warrant life 3 years from issue date Exercise date Last working day of each quarter, from issue date Exercise price per 1 share (Baht) 1.00 Exercise ratio (warrant to common share) 1:1 j) Approved the increase in the registered share capital of Bright Development Bangkok Company Limited from Baht 500 million (5 million ordinary shares with a par value of Baht 100 each) to Baht 1,000 million (10 million ordinary shares with a par value of Baht 100 each). The Company will hold all shares. k) Approved the establishment of a subsidiary, U&I Company Limited, to engage in the provision of construction service. Such company is to have a registered share capital of Baht 100 million (1 million ordinary shares with a par value of Baht 100 each) and the Company will hold a 99.99% interest. 39. Approval of financial statements These financial statements were authorized for issue by the Company’s Board of Directors on 25 February 2011.

148 PROPERTY PERFECT ANNUAL REPORT 2010 The Board of Directors’ responsibilities for Fifinancial reports

Property Perfect Public Company Limited’s and subsidiaries’ financial statements are prepared in compli- ance with accounting standard stipulated in the Accounting Professions Act B.E.2547, presented in accordance with the requirements in the Business Development Department’s announcement on 14 September 2001 regarding in the Accounting ACT.B.E.2543 , and adjusts accounting practices to be in line with the Federation of Accounting Professions Notification 9/2007, 38/2007 and 62/2007 concerning the accounting standard.

The Board of Directors has appointed the Audit Committee comprising non-executive directors to take responsible for financial reports to follow the account standard and related regulators, disclose adequate and on-time information, and have internal control system to supervise internal control activities and the Audit Com- mittee’s Opinions in the Audit Committee’s reports shown in the annual report

The Board of Directors takes responsible for Property Perfect’s and its subsidiaries’ financial reports prepared to ensure that financial position, revenue, expense and cash flow are presented accurately and reasonably. The Board of Directors prepares accurate and complete accounting records to maintain assets, and internal control system to prevent fraudulent irregularities activities. The Board of Directors has selected the appropriated and constantly practical accounting policy in preparing the financial reports to reflect the company’s actual performance in compliance with the Generally Accepted Accounting principles and adequate information disclosure in notes to financial statements. Auditor expresses opinions on Property Perfect’s and subsidiaries’ financial statements in auditors’ report.

Tawatchai Nakata Chainid Ngow-sirimanee Chairman Chief Executive Office

ANNUAL REPORT 2010 PROPERTY PERFECT 149 Audit Committee Report 2009

Dear valued shareholders

Property Perfect Public Company Limited’s Audit Committee comprises three independent directors – having Mr.Krish Follett as Chairman, and Mr. Somsak Toraksa and Dr. Thamnoon Ananthothai as directors. The Board of Directors on 1 May 2010 appointed Mr. Krish Follett as chairman of the Audit Committee, replacing Mr. Virayuk Puntupetch whose term expired. Miss Duangporn Roemyindi, director of the internal audit office, was appointed the committee’s secretary. In 2010, the Audit Committee followed through the Audit Committee Charter, which was endorsed by the Board. It organized 7 meetings to review financial information, connected transactions between the company and subsidiaries and the performance of the internal audit office. Twice, it had discussions with the auditor for progress monitoring and the exchange of views on the company’s internal control and accounting. The Audit Committee’s major activities can be summarized as below:

1. To review quarterly and yearly financial statements, and yearly consolidated financial statements for the year 2009 Audit Committee invite executives and auditor join the meeting to reviewed the financial statements with to ensure that the financial statements were prepared appropriately, and compliance with the Generally Accepted Accounting Principles and other related regulations. The committee also has duty to assure accounting system’s accuracy and reliability and sufficient and on-time information disclosure in financial statements to benefit investors and financial statements users in making investment decision. 2. To review connected transactions Audit Committee reviewed connected transactions between the company and subsidiaries and associates to assure that the company operated in normal course of business and provided neces- sary financial assistance to subsidiaries for project development and expansion as planned. 3. To review risk management Audit Committee made suggestions on the company’s risk management to ensure that the company ably puts risks at the acceptable level and achieve the business goals. The committee assigned the internal audit office to coordinate with the Risk Management Committee on risk assessment, to assimilate their data in internal audit planning. This is to ensure that the internal audit can support the company towards the prescribed goals, effectively and efficiently. 4. To review good governance issues Audit Committee ensured that the company’s information disclosure is in line with the Securities and Exchange Act and other laws related to the company’s business operations, for the confidence among shareholders and investors. 5. To review evaluation of internal control system Audit Committee reviews in the way of COSO as to whether the company’s internal control system is appropriate, to achieves its objectives in using resources efficiently and effectively, and has a preventive system to reduce mistakes, damages and deplete the company’s resources as well as whether the financial statements is reliable. 6. To review internal audit Audit Committee approved the annual risk-based approach of the internal audit office; acknowledged the annual 2010 internal audit assessment report; and ensured the efficient and effective internal audit for acceptable risks and changing environment. Audit Committee ensured that the company improved its operations in line with suggestions on significant issues stated in the internal audit

150 PROPERTY PERFECT ANNUAL REPORT 2010 assessment report. Audit Committee also devised plans for the transformation from operational audit approach to risk-based audit approach, to come up with efficient and effective advice for the management. 7. To review the company’s monitoring and operating performance evaluation system Audit Committee reviews the company’s performance to ensure that the company follows the targets and adjusts operation to be accordance with the changed situation. The committee sup- ports the company to determine clearer performance evaluation and indicators and enhance the internal control become a part of normal practice of management .. 8. To conduct self-assessment Audit Committee carried out self-assessment in many aspects including the number of meetings, scope of power, internal control, financial reporting, compliance to rules and regulations, coordina- tion with the auditor, the supervision and improvement of internal control, in order to improve its operations and reporting to the Board. 9. To screen auditor Audit Committee selected the auditor upon on the auditor’s independence and defined the appropri- ate fee. The decision was forwarded to the Board and later submitted to the shareholder meeting for approval. Ernst & Young Office Company Limited was appointed as the auditor for year 2010.

Audit Committee constantly reports resolutions of all meetings to the Board of Directors, independently practices assigned tasks on behalf of the Audit Committee with knowledge and competence, and gives suggestions straightly and appropriately for interests of the company, shareholders and other stakeholders.

(Mr. Krish Follett) Chairman of the Audit Committee 25February 2010

ANNUAL REPORT 2010 PROPERTY PERFECT 151 Auditor Fee Accuracy Sanctification Form

รอบปีบัญชี สิ้นสุดวันที่ 31 ธันวาคม 2553 Audit Fee

Item Payer Auditor Fee Audit Fee 1 Property Perfect Plc. Miss. Siraporn Ouaanunkun 1,700,000 2 Estate Perfect Co., Ltd. Miss. Siraporn Ouaanunkun 565,000 Perfect sportclub Co., Ltd 3 (Formerly: Perfect Satellite Services Co.,Ltd) Miss. Siraporn Ouaanunkun 100,000 4 Bright Development Bangkok Co.,Ltd. Miss. Siraporn Ouaanunkun 250,000 5 Center Point Shopping Mall Co.,Ltd. Miss. Siraporn Ouaanunkun 100,000 6 Residence Number Nine Co., Ltd. Miss. Siraporn Ouaanunkun 100,000 Total fee 2,570,000 New accounting standard training fees. 1 Property Perfect Plc. 250,000 Total fee 250,000 Total fee 3,065,000

The above information is

Accurate. I certify there is no other service I know of that the company and subsidiaries awarded to me, my auditing firm, and individuals or companies connected to me.

Inaccurate. Note: ......

To improve the above information (if any), I affirm the accuracy of all information in this form that shows the audit fee and other service fee that the company and subsidiaries pay to me, my auditing firm, and individuals or companies connected to me.

(Miss. Siraporn Ouaanunkun) Ernst & Young Co.,Ltd Auditor of Property Perfect Public Company Limited

152 PROPERTY PERFECT ANNUAL REPORT 2010