23 March 2018
Subject : Invitation to attend the Annual General Meeting of Shareholders of the Company for the year 2018. Attention : Shareholders of Grande Asset Hotels and Property Public Company Limited. Enclosures : 1. Copy of Minutes of Annual General Meeting of Shareholders of the Company for the year 2017. 2. Annual Report for the fiscal year 2017, the statements of financial position as at 31 December 2017, the statements of comprehensive income, changes in shareholders’ equity and cash flows for the year then ended (in CD-ROM). 3. Name list and profiles of the directors nominated to be elected as directors to replace those retiring by rotation. 4. Scope of Duties and Responsibilities of the Audit Committee. 5. Amount of Auditor’s Remunerations for the years 2016-2018. 6. Information Memorandum of the Acquisition of Assets and Making of the Tender Offer of Entries Securities of Royal Orchid Hotel (Thailand) Public Company Limited (Schedule 2). 7. Report on the Opinion of Independent Financial Advisor relating to the Acquisition of Assets of Grande Asset Hotels and Property Public Company Limited. 8. Information Memorandum in relation to the Allotment and Offering of Capital Increase Ordinary Shares. 9. Profiles of Independent Directors (acting as Proxy of the Shareholders). 10. Proxy Form A. and Form B. 11. The required documents or evidence to identify the right to attend the Annual General Meeting of Shareholders for the year 2018. 12. Articles of Association of the Company related to the Annual General Meeting of Shareholders. 13. Location Map of the venue of the Annual General Meeting of Shareholders.
The Board of Directors of Grande Asset Hotels and Property Public Company Limited has resolved to call the Annual General Meeting of Shareholders of the Company for the year 2018 on Friday, 20 April 2018, at 10.00 hrs., at the Ballroom, 7th Floor, The Westin Grande Sukhumvit Hotel, No. 259 Sukhumvit Road, Klongtoey Nua Sub-District, Wattana District, Bangkok Metropolis, to consider the matters in accordance with the following agenda:
Agenda 1. To acknowledge the matters notified by the Chairman of the Board.
Opinion of the Board: The Shareholders meeting is hereby advised to acknowledge the matters to be informed by the Chairman on the date of the Shareholders Meeting.
GRANDE ASSET HOTELS and PROPERTY PUBLIC CO., LTD. Unit 3203 – 4, 32nd Fl., Exchange Tower, 388 Sukhumvit Road, Klongtoey, Bangkok 10110 Thailand. T: 66 (2) 204 9900 F: 66 (2) 204 9999 www.grandeasset.com
Agenda 2. To consider and adopt the Minutes of the Annual General Meeting of Shareholders of the Company for the year 2017 held on 24 April 2017. (Resolution: By a majority vote of shareholders attending the meeting and casting their votes)
Background Information: The Annual General Meeting of Shareholders of the Company for the year 2017 was held on 24 April 2017, and the minutes of the meeting has been submitted to the Stock Exchange of Thailand and the Ministry of Commerce by the Company within the timeframe prescribed by laws, which the details are attached in Enclosure 1.
Opinion of the Board: The Shareholders meeting is hereby advised to adopt the Minutes of the Annual General Meeting of Shareholders of the Company for the year 2017 was held on 24 April 2017.
Agenda 3. To consider and acknowledge the performance results of the Company for the year 2017. (Resolution: This Agenda is for acknowledgement. Therefore, no votes will be cast)
Background Information: The report of the performance results of the Company for the previous year 2017 appears in the Annual Report for the fiscal year 2017 in Enclosure 2.
Opinion of the Board: The Shareholders meeting is hereby advised to acknowledge the performance results of the Company for the previous year and the Annual Report for the fiscal year 2017.
Agenda 4. To consider and approve the statements of financial position as at 31 December 2017, the statements of comprehensive income, changes in shareholders’ equity and cash flows for the year then ended. (Resolution: By a majority vote of shareholders attending the meeting and casting their votes)
Background Information: In compliance with Section 112 of the Public Limited Companies Act B.E. 2535 and Article 45 of the Company’s Articles of Association, which stipulate that the Board of Directors of the Company shall arrange for preparation of the statements of financial position and the statements of comprehensive income as of the end of the accounting period of the Company, and shall submit the same to the Shareholders Meeting at the Annual General Meeting for consideration and approval. Therefore, the Board of Directors of the Company proposed to the Annual General Meeting of Shareholders to consider and approve the statements of financial position as at 31 December 2017, the statements of comprehensive income, changes in shareholders’ equity and cash flows for the year then ended of the Company, which have been audited and certified by the Auditor and have been reviewed by the Audit Committee of the Company as shown in the Annual Report for the fiscal year 2017 in Enclosure 2.
Opinion of the Board: The Shareholders meeting is hereby advised to consider and approve the statements of financial position as at 31 December 2017, the statements of comprehensive income, changes in shareholders’ equity and cash flows for the year then ended of the Company, which have been reviewed by the Audit Committee and have been audited and certified by the Auditor.
2 Agenda 5. To acknowledge an appropriation of profits and consider the payment of dividends for the performance results of the fiscal year 2017. (Resolution: By a majority vote of shareholders attending the meeting and casting their votes)
Background Information: According to Section 116 of the Public Limited Companies Act B.E. 2535 and Article 48 of the Company’s Articles of Association which stipulate that the Company shall appropriate a reserve fund, from the annual net profit, at least five (5) percent of the annual net profit less the accumulated loss carried forward (if any) until the reserve fund reaches not less than ten (10) percent of the registered capital. In addition, the Company has the policy to pay dividends at the rate not lower than 50% of the net profits after deduction of the corporate income tax. However the Company may fix the dividends payment lower than the rate as specified above, in case the Company has necessary for taking the said amount of the net profits in order for completion of the existing projects or for expending the business of the Company. Moreover, pursuant to Section 115 of the Public Limited Companies Act B.E. 2535 and Article 47 of the Company’s Articles of Association which stipulate that the Company is prohibited from paying dividends out of other funds except profits, and in case the Company has the accumulated losses, the Company shall not pay any dividend. Dividend payment is to be divided equally by the number of shares, and shall be approved by the shareholders meeting. Since the Company has the net profits from its performance results of the year 2017 in accordance with the separated financial statements of the Company ended 31 December 2017 the amount of 213,704,086.18 Baht and there are no any accumulated losses, the Company then appropriated a part of profits as a legal reserve in the amount of 10,685,204.31 Baht, resulting that it has the remaining profits which could be pay the dividends in the amount of 203,018,881.87 Baht. Therefore, the Board of Directors of the Company then proposed to the Shareholders meeting for consideration of the acknowledgement of an appropriation of a part of profits of the fiscal year 2017 as a legal reserve in the amount of 10,685,204.31 Baht and the payment of dividends for the performance results of the fiscal year 2017 to the shareholders of the Company in the number of 2,889,039,237 shares as follows; 1. Approval for the Company to pay the dividend by ordinary shares to the Shareholders of the Company at the ratio of 25 existing shares to 1 dividend share, being ordinary shares in the amount not exceeding 115,561,569 shares, with the par value of 1.- Baht per share, totaling amount not exceeding 115,561,569.- Baht or equivalent to the rate of payment of share dividends of 0.04 Baht per share. In case of any Shareholder has a friction of existing share after allotment of the dividend share, the dividend shall be paid by cash in place of the payment by ordinary shares at the rate of 0.04 Baht per share; and 2. Approval for the Company to pay the dividend by cash at the rate of 0.004445 Baht per share, being the amount not exceeding 12,841,780.- Baht. Therefore, the total payment of dividends for the performance results of the fiscal year 2017 is at the rate of 0.044445 Baht per share, being equivalent to 63.25 percent of the net profits of the fiscal year 2017, and it is in accordance with the conditions in the policy of dividend payment as announced by the Company. Whereby, the names of Shareholders who are entitled to receive dividends have been fixed on Friday, 23 March 2018, which the Company will pay dividends on or before Friday, 18 May 2018. However, such dividends shall be
3 subject to the withholding tax at the rate as specified by law, whereby the Company will deduct the withholding tax for all dividends from the dividends paid in cash. In addition, the right for receiving dividends is still uncertainty because it is required to obtain the approval from the Annual General Meeting of Shareholders of the Company for the year 2018.
Opinion of the Board: The Shareholders meeting is hereby advised to acknowledge the appropriation of a part of profits as a legal reserve in the amount of 10,685,204.31 Baht and approve for the payment of dividends for the performance results of the fiscal year 2017 to the Shareholders of the Company with the details as proposed above.
Agenda 6. To consider and elect new directors replacing those retiring by rotation. (Resolution: By a majority vote of shareholders attending the meeting and casting their votes)
Background Information: In compliance with Section 71 of the Public Limited Companies Act B.E. 2535 and Article 21 of the Company’s Articles of Association, it provides that one-third of the Directors are required to retire from office every year, whereby the Directors who have been in the longest term in office are required to retire by rotation. But they are entitled to be re-elected to resume the positions of the Directors of the Company. The Company had twelve Directors in total. Therefore, there are four Directors who are to retire from offices by rotation in this occasion, as follows: 1. Mr. Wichai Thongtang Chairman of the Board 2. Dr. Bhichit Rattakul Vice Chairman of the Board and Chairman of Executive Committee 3. Mr. Paisit Kaenchan Director and Executive Committee 4. Mr. Amarit Pansiri Independent Director and Audit Committee Member Provided that the said four directors were the persons who have the appropriated qualification, knowledge, ability and experience related to the businesses of the Company which they were beneficial the business operation of the Company. It then proposed to the Shareholders’ meeting for consideration of the re-election of the said four directors to their offices as the directors for another term. The name list and profiles of the directors nominated to be elected as Directors to replace those retiring by rotation appears in Enclosure 3.
Opinion of the Board: The Shareholders meeting is hereby advised to consider and re-elect new directors replacing those being retired by rotation as follows: (1) Re-election of Mr. Wichai Thongtang, Dr. Bhichit Rattakul and Mr. Paisit Kaenchan, being the Directors due to retire by rotation in this occasion, to resume the offices of the Directors of the Company for another term. (2) Re-election of Mr. Amarit Pansiri, being the Director due to retire by rotation in this occasion, to resume the office of the Director, Independent Director and Audit Committee of the Company for another term.
4 Agenda 7. To consider and approve the remuneration of the Directors for the year 2018. (Resolution: By the votes not less than two-third of the total number of votes of shareholders attending the meeting and having right to vote) Background Information: In compliance with Section 90 of the Public Limited Companies Act B.E. 2535 and Article 35 of the Company’s Articles of Association, it provides that the payment of the remuneration (attendance fees) to the Board of Directors of the Company, it requires the approval from the Shareholders Meeting. The Board of Directors has considered the remuneration to the Directors in comparison with the rates of the directors’ remuneration of the same business group as well as the appropriateness for the scope of duties and responsibilities of the Board of Directors, it is hereby proposed to the Shareholders meeting for consideration of the remuneration of the Directors for the year 2018. Opinion of the Board: The Shareholders meeting is hereby advised to approve the payment of the remuneration of the Directors for the year 2018 in the form of attendance fees with the same rate as approved in the year 2017, as follows: 1. The Attendance fees for the meeting of Board of Directors in an amount of Baht 50,000.- per meeting per person. 2. The Attendance fees for the meeting of Audit Committee and Risk Management Committee in an amount of Baht 50,000.- per meeting per person. 3. The Attendance fees for the meeting of Executive Committee in an amount of Baht 10,000.- per meeting per person and fixing the attendance fees for the meeting of Executive Committee in the amount not exceeding 1,500,000.- Baht per year. Agenda 8. To consider and appoint the auditors and to fix the auditor’s remunerations for the year 2018. (Resolution: By a majority vote of shareholders attending the meeting and casting their votes) Background Information: In compliance with section 120 of the Public Limited Companies Act B.E. 2535 and the Article 43 of the Company’s Articles of Association which provides that every Annual General Meeting of Shareholders shall appoint the auditors and fix the auditing fee. Therefore, it is necessary for the Company to appoint the auditors for the fiscal year 2018 and fix their auditing fees. The Board of Directors has considered at the deliberation and recommendation of the Audit Committee to be appropriate for the Shareholders meeting to consider and appoint the Auditors of Pricewaterhousecoopers ABAS Company Limited as the Company’s auditors for the fiscal year 2018, considering that they are qualified under the regulations of the Office of Securities Exchange Commission, having experience and expertise in auditing, as well as having the auditing standard as accepted by the listed companies in the Stock Exchange of Thailand, the details of which are as follows:
Auditor Names CPA Registration No. Years of Auditing 1. Mr. Chanchai Chaiprasit 3760 0 2. Mr. Pisit Thangtanagul 4095 0 3. Miss Nopanuch Apichatsatien 5266 0
5 Whereby any one of the above-mentioned auditors is authorized to audit, perform and set his/her signature in its audit report, and to consider the fixing of the remuneration of the Auditors in the amount not exceeding 2,500,000.- Baht. Moreover, Pricewaterhousecoopers ABAS Company Limited is also acting as the auditor of the Company’s subsidiaries. The Company had attached the auditor’s remunerations in the previous years with the details as appeared in Enclosure 5. Pricewaterhousecoopers ABAS Company Limited and the auditors proposed to be the auditors of the Company and its subsidiary companies have no relationship or any interest with the Company or its subsidiary companies, managements or related persons in such a way which may have an impact on performing their task independently.
Opinion of the Board: The Shareholders meeting is hereby advised to appoint the auditors of Pricewaterhousecoopers ABAS Company Limited by Mr. Chanchai Chaiprasit, C.P.A. Registration 3760, and/or Mr. Pisit Thangtanagul, C.P.A. Registration 4095, and/or Miss Nopanuch Apichatsatien, C.P.A. Registration 5266 as the Company’s auditors for the year 2018 and fixing the remuneration of the Auditors in the amount not exceeding 2,500,000.- Baht.
Agenda 9. To consider and approve the entering into of the investment of ordinary shares of Royal Orchid Hotel (Thailand) Public Company Limited (“ROH”) and making of the tender offer of entire securities of ROH. (Resolution: By the votes not less than three-fourth of the total number of votes of shareholders attending the meeting and having right to vote without the votes of interested shareholders)
Background Information: The Company will enter into the investment of ordinary shares of Royal Orchid Hotel (Thailand) Public Company Limited and making of the tender offer of entire securities of ROH (Tender Offer) with the important details as follows: Purchaser : Grande Asset Hotels and Property Public Company Limited Sellers : 1. Thai Airways International Public Company Limited (“THAI”) 2. Starwood Hotels (Thailand) Co., Ltd. (“Starwood”) 3. All shareholders of ROH Relationship : The Purchaser and the Sellers are not the connected persons in between the accordance with the Notification of the Capital Market Supervisory Purchaser Board No. Tor.Jor. 21/2551 Re: Rules on entering into a connected and the Sellers transaction and the Notification of the Board of Directors of the Stock Exchange of Thailand Re : Disclosure of Information and Actions of Listed Company on Connected Transactions B.E. 2546. General : 1. The Company will purchase the ordinary shares of ROH which characteristics of are held by THAI in the number of 22,500,000 shares with the transactions par value of 10.- Baht per share, equivalent to 24% of the total number of issued shares of ROH, at the price of 41.- Baht per share, totaling of 922,500,000.- Baht.
6 2. The Company will purchase the ordinary shares of ROH which are held by Starwood in the number of 41,250,235 shares with the par value of 10.- Baht per share, equivalent to 44% of the total number of issued shares of ROH, at the price of 35.- Baht per share, totaling of 1,443,758,225.- Baht. 3. The Company will make the tender offer of entire securities of ROH from all shareholders of ROH after the Company has already purchased and taken the transfer of the ordinary shares of ROH from THAI and Starwood, whereby they are the ordinary shares of ROH in the number of 29,999,765 shares with the par value of 10.- Baht per share, equivalent to 32% of the total number of issued shares of ROH, at the price of 41.- Baht per share (the highest price of the shares of ROH which will be acquired by the Company in between the period of 90 days before the submission of the tender offer of all securities of ROH. However, the Company and its subsidiaries are not the current shareholders of ROH), totaling of 1,229,990,365.- Baht which the Company will pay in full amount to the shareholders of ROH who accept the tender offer for all securities of the Company. However, it is in accordance with the Notification of the Capital Market Supervisory Board No. Tor Jor. 12/2554 Re: Rules, Conditions and Procedures for the Acquisition of Securities for Business Takeover , because the Company will acquire the ordinary shares of ROH more than 50% of the total voting right of ROH. Reasons for : It is in order to increase the ability of business competition of the entering into hotel business against with other entrepreneurs with efficiency and the transaction contribute the reliability of hotel business operation of Company as well as encourage the expansion of consumer base and revenue of hotel business of the Company.
The entering into of the investments of the Company are categorized as the transactions of acquisition of assets in accordance with the Notification of the Capital Market Supervisory Board No. Tor Jor. 20/2551 Re: Rules on Entering into Material Transactions Deemed as Acquisition or Disposal of Assets and the Notification of the Board of Directors of the Stock Exchange of Thailand Re: Disclosure of Information and Other Acts of Listed Companies Concerning the Acquisition and Disposition of Assets B.E. 2547 which has the value of transactions requiring to approve for the entering into of the said transactions by the Shareholders’ meeting of the Company with the votes not less than three-fourth of the total number of votes of shareholders attending the meeting and having right to vote without the votes of interested shareholders. The details of the transactions appear in the Information Memorandum of the Acquisition of Assets and Making of the Tender Offer of Entries Securities of Royal Orchid Hotel (Thailand) Public Company Limited (Schedule 2) as shown in Enclosure 6.
7 In this matter, the Board of Directors Meeting of the Company No. 6/2017, held on 27 December 2017 had resolved to approve for the submission to the Shareholders’ meeting for consideration and approval of the investment of ordinary shares of ROH and making of the tender offer of entire securities of ROH including the appointment of Beyond Advisor Company Limited as the Independent Financial Advisor for providing its opinion in relation to the investment of ordinary shares of ROH with the details appear in Report on the Opinion of Independent Financial Advisor relating to the Acquisition of Assets of Grande Asset Hotels and Property Public Company Limited as shown in Enclosure 7.
Opinion of the Board: The Shareholders meeting is hereby advised to consider as follows: 1. Approval for the Company to enter into the investment of ordinary shares of ROH and making of the tender offer of entire securities of ROH as detailed above.
2. The Executive Committee and/or the authorized director(s) of the Company and/or the person(s) designated by the Executive Committee or the authorized directors of the Company shall have the authorities to consider the relevant conditions and other details and the negotiation, entry into agreement and execution of the necessary and relevant documents and agreements in order for the achievement of transactions as approved, including the contacting and submission of applications for such permission, documents and evidences to relevant authorities or agencies, as well as being empowered to take any other action which is necessary and appropriate for the entering into of the investment of ordinary shares of ROH and making of the tender offer of entire securities of ROH as deemed appropriate by complying with the relevant laws and/or regulations.
Agenda 10. To consider the change of the allotment and offering of capital increase ordinary shares to investors in private placement in accordance with the resolution of the Annual General Meeting of Shareholders of the Company for the year 2017. (Resolution: By a majority vote of shareholders attending the meeting and casting their votes)
Background Information: According to the Annual General Meeting of Shareholders of the Company for the year 2017, held on 24 April 2017, had resolved to approve for the Company to allot the capital increase ordinary shares in the number of 1,244,248,992 shares, with the par value of 1.- Baht per share for offering in entirety or in portions for offering in lots from time to time to investors in private placement categorized under the Notification of the Capital Market Supervisory Board No. Tor Jor. 72/2558 Re: Approval for the Listed Companies to Offer Newly Issued Shares to Investors in Private Placement, whereby the Board of Directors of the Company or the person who designated by the Board of Directors of the Company shall offer the entire shares within the period not exceeding 12 months from the date of the Annual General Meeting of Shareholders of the Company for the year 2017 had resolved for the approval of such offering shares. But after the Company had been approved from the said Annual General Meeting of Shareholders until now, the Company had not yet allotted and offered such capital increase ordinary shares to investors in private placement due to the fluctuation of the major economic condition and the unfavorable market condition including the negotiation with the investors, who are interesting to invest in the Company, had not been progressed in accordance with the expectation. Meanwhile, the
8 Annual General Meeting of Shareholders for the year 2017 and the relevant Notification of the Capital Market Supervisory Board provides the Company to offer such capital increase ordinary shares within the period not exceeding 12 months from the approval date of the Annual General Meeting of Shareholders which will be due date within this April 2018, resulting that the Board of Directors of the Company could not offer such capital increase ordinary shares to investors in private placement in accordance with the resolution of the Annual General Meeting of Shareholders and the relevant Notification of the Capital Market Supervisory Board. However, the Company is still necessitated to have the resolution for allotment of the capital increase ordinary shares in order for offering to the investors in private placement at the appropriate time and to reserve for accommodation of the investment and development of various projects of the Company and its subsidiaries. In addition, the Company is also required to allot the unissued capital increase ordinary shares to reserve for accommodation of the payment of dividends to the Shareholders of the Company. Therefore, the Board of Directors of the Company then proposed to the Annual General Meeting of Shareholders for the year 2018 for consideration of the change of the allotment and offering of the unissued capital increase ordinary shares to be as follows:
1. Approval for the Company to allot the unissued capital increase ordinary shares in the number of 115,561,569 shares, with the par value of 1.- Baht per share to reserve for accommodation of the payment of dividends by the ordinary shares to the Shareholders of the Company.
2. Approval for the Company to allot the unissued capital increase ordinary shares in the number of 1,128,687,423 shares, with the par value of 1.- Baht per share for offering in entirety or in portions for offering in lots from time to time to investors in private placement categorized under the Notification of the Capital Market Supervisory Board No. Tor Jor. 72/2558 Re: Approval for the Listed Companies to Offer Newly Issued Shares to Investors in Private Placement which such persons are not connected persons of the Company, whereby the Board of Directors of the Company or the person who designated by the Board of Directors of the Company shall have the authority to determine the offering price of the shares at the best market price in accordance with the market condition during the offering period to the investor(s) which shall not lower than 1.- Baht per share and shall not lower than the following price:
(1) The weighted average of the Company’s share price trading on the Stock Exchange of Thailand (“SET”) for not lower than 7 consecutive trading days but not exceeding 15 consecutive trading days prior to the determination date of the offering price of such shares (“Market Price”), whereby such weighted average of share price is required to use the average price of shares trading in each day. Provide that, the determination date of offering price is required to backward not exceeding 3 trading days prior to the first date of offering shares to the investor(s). However, the Board of Directors of the Company may determine the discount on the offering price but shall not exceed 10% of such Market Price.
(2) The price which is determined by the book building method surveyed by the securities company.
9 In this regard, the Board of Directors of the Company or the person who designated by the Board of Directors of the Company shall offer the entire shares within the period not exceeding 12 months from the date of the Shareholders meeting of the Company has resolved for the approval of such offering shares.
3. For the allotment and offering of capital increase ordinary shares of the Company above, the Board of Directors and/or the Executive Committee and/or the authorized director(s) of the Company and/or the person(s) designated by the Board of Directors or the Executive Committee or the authorized directors of the Company shall have the authorities to consider the fixing of other details regarding the allotment and offering of capital increase ordinary shares, such as (1) searching of investors in private placement; (2) fixing of the date, time and place for subscription and payment of the capital increase ordinary shares; (3) fixing of the terms, conditions and details regarding the allotment and offering of capital increase ordinary shares; (4) negotiation, entry into agreement and execution of relevant documents and agreements regarding the allotment and offering of capital increase ordinary shares; and (5) execution of applications for permission and necessary and relevant evidence regarding such allotment and offering of capital increase ordinary shares, including the contacting and submission of applications for such permission, documents and evidence to relevant authorities or agencies, the listing of such capital increase ordinary shares on the Stock Exchange of Thailand and being empowered to take any other action which is necessary and appropriate for the allocation and offering of such capital increase ordinary shares as deemed appropriate by complying with the laws and/or regulations concerned.
In addition, The Company shall be entitled to register the change of the paid-up capital with the Registrar of Public Limited Companies from time to time in accordance with the periodic payments of the shareholders and investors in each time.
Moreover, for the convenience in effecting the registration of the capital increase of the Company, which certain words or statements in the registration documents or Minutes of the Shareholders meeting might be subject to amend by the order of the Registrar, the Shareholders meeting is requested to authorize to the authorized directors of the Company or their authorized representatives to amend any words or statements in the documents and/or applications related to the registration of the capital increase of the Company, forthwith without seeking an approval from the meeting of the Shareholders.
Provided that the details of the allotment and offering of capital increase ordinary shares in this occasion appeared in the Information Memorandum in relation to the Allotment and Offering of Capital Increase Ordinary Shares as shown in Enclosure 8.
Opinion of the Board: The Shareholders meeting is hereby advised to consider and approve for the change of the allotment and offering of capital increase ordinary shares to investors in private placement in accordance with the resolution of the Annual General Meeting of Shareholders of the Company for the year 2017 with the details as proposed.
10 Agenda 11. To consider any other business (if any).
You are hereby invited to attend the meeting on the date, time and place specified above. In this regard, all shareholders or proxies are able to register and submit the document or evidence for examination at the meeting venue from 8.30 hrs. on Friday, 20 April 2018 onward. Any shareholder who cannot be present at the meeting, may appoint the other persons or the Independent Directors of the Company to be the proxies, whose names and details as shown in Enclosure 9, so as to attend the meeting and vote on your behalf. The Company hereby prepares a Proxy Form B in Enclosure 10, which clearly specifies certain items and authority to be delegated to the proxy. Please fill out the box in front of the name of the person you wish to appoint as your proxy to attend the meeting and vote on your behalf, and sign your name in the proxy form. In addition, there is Proxy Form A, a general and simple proxy form. And you are required to select any one out of the Forms as specified above only.
In order to speed up and facilitate the registration process at the Meeting of Shareholders, it is kindly requested that the shareholders and/or the proxies bring the document or evidence for the proving of the person being shareholder or its representative who are eligible to attend the meeting as per the details of which appears in Enclosure 11 to present them to the registration staff on the date of the meeting.
According to Section 105 of the Public Limited Companies Act B.E. 2535, it provides that a shareholder of the Company may propose additional agenda(s) for consideration at a Shareholders Meeting. However, they shall hold shares in aggregate amount not less than one-third of the total issued shares of the Company.
The Company has fixed the names of Shareholders who are entitled to attend the Annual General Meeting of Shareholders for the year 2018 on Friday, 23 March 2018 (Record Date).
By resolution of the Board of Directors
Mr. Wichai Thongtang Chairman of the Board
Remark: The Company has disseminated the Notice of the Meeting of Shareholders, together with all related documents which are the same version as sent to the shareholders, on the Company’s website http://www.grandeasset.com
m/emin/agm-grande 61/notice agm.doc
11 Enclosure 1 (supporting documents for the consideration of Agenda 2)
GRANDE ASSET HOTELS AND PROPERTY PUBLIC COMPANY LIMITED Minutes of the Annual General Meeting of Shareholders for the year 2017 ______Time and Place. Held on Monday, 24 April 2017 at 9.45 hrs., at the Ballroom, 7th Floor, The Westin Grande Sukhumvit Hotel, No. 259 Sukhumvit Road, Kwaeng Klongtoey Nua, Khet Wattana, Bangkok Metropolis. Preliminary Proceedings. Mr. Wichai Thongtang, the Chairman of the Board, presided at the meeting. The Chairman announced that 178 Shareholders were present in person and by proxy, representing 1,907,251,068 shares, being equivalent to 66.02 percent of the total number of 2,889,039,237 shares, constituting the quorum as required by the Articles of Association of the Company. And during the meeting, additional Shareholders attended the meeting, making up a total of 275 Shareholders were present in person and by proxy, representing 1,915,137,584 shares, being equivalent to 66.29 percent of the total number of 2,889,039,237 shares. Prior to proceeding with the meeting in accordance with the Agenda as stated in the notice, the Chairman introduced the Directors who attended this meeting, as follows: 1. Mr. Wichai Thongtang Chairman of the Board 2. Dr. Bhichit Rattakul Vice Chairman of the Board and Chairman of the Executive Committee 3. Mr. Chainid Adhyanasakul Director and Vice Chairman of the Executive Committee 4. Mr. Vitavas Vibhagool Director and Executive Committee 5. Miss Wilawun Leongnarktongdee Director and Executive Committee 6. Mr. Suradej Narula Director and Executive Committee 7. Mr. Amarin Narula Director and Executive Committee 8. Mr. Paisit Kaenchan Director, Executive Committee and Chief Executive Officer 9. Mrs. Phornsiri Manoharn Independent Director and Chairman of the Risk Management Committee 10. Mr. Pornchai Kittipanyangam Independent Director and Chairman of the Audit Committee 11. Mr. Wattana Suthipinijtham Independent Director and Audit Committee 12. Mr. Amarit Pansiri Independent Director and Audit Committee However, the percentage of the Directors attending the meeting was equivalent to 100 percent of the total number of the Directors of the Company. And the Chairman assigned Mr. Paisit Kaenchan to introduce the Executives and other related persons attending the meeting for explanation of the facts and answering the inquiries of the Shareholders as follows: 1. Mr. Somchai Treeratanaphitak Executive Vice President of Legal Affairs
1 Enclosure 1 (supporting documents for the consideration of Agenda 2)
2. Mr. Sathit Kiatkrajai Executive Vice President of Accounting & Control 3. Miss Tipaporn Panitpong Chief Operating Officer 4. Mr. Somsak Chaipitoonsawas Executive Vice President of Construction, Design and Project Development 5. Mr. Sutipong Jitnotai Executive Vice President of Business Development 6. Mr. Poodis Poramapojn Vice President of Hotel Asset Management 7. Miss Chadaporn Chayawan Vice President of Finance 8. Miss Krongkaew Limkittikul Auditor from EY Office Limited 9. Miss Boontavee Sakulwatcharin Manager from EY Office Limited 10. Miss Somsri Kiattirarat Legal Counselor 11. Mr. Attapol Chinrattanalap Accounting and Financial Advisor Afterwards, Miss Somsri Kiattirarat was assigned by the Chairman to explain the details of the procedures of the casting and counting of votes in each agenda of the meeting to the Shareholders for acknowledgement as follows: • Each Shareholder has the right to vote according to the number of shares held by him/her, whereby one share is equal to one vote. Each Shareholder is entitled to cast his/her votes in each agenda to either approve, disapprove or abstain from voting, otherwise the ballots being invalid from voting except that the proxies for foreign investors who have appointed custodians in Thailand to safekeep and take care of their securities, such proxies are required to vote according to the Shareholders indication in the Proxy Form. • Voting in each agenda shall be made openly by the Shareholders whereby the Chairman will assign the Legal Counselor being the person inquiring to the meeting. If there was no Shareholder voting as “Disapproved” or “Abstained”, it would be deemed that the meeting had resolved unanimous resolution to approve or agree in accordance with the proposal of the Board of Directors of the Company. • In case that there were Shareholders who disagreed or disapproved or abstained in any agenda, such Shareholders or proxies were required to fill out their resolutions and sign their names in the ballots which the Company have been distributed to all Shareholders before attending at the meeting. • With the exception of Agenda 6 regarding the election of new Directors to replace those retiring by rotation, all Shareholders or proxies must be voting in the ballots as distributed by the Company and submit them to the Company officers for vote counting. However, any Shareholders who do not so submit the ballot will be assumed to have approved the agenda as proposed by the Board of Directors of the Company. • To count the votes of each agenda, the Company will deduct the total votes casted in disapproval or abstentions as well as the invalid ballots, from the total votes of Shareholders attending at the meeting and being entitled to vote. The result shall be taken as the votes in approval. As for the Shareholders who have entrusted their proxies to the Independent Directors or other persons to attend the meeting and cast their votes in accordance with their wishes, the result thereof shall be the votes including the votes in accordance with the wishes of the principals.
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• After that, the Chairman will assign the Legal Counselor being the person summarizing the result of the votes counting in each agenda to the meeting for acknowledgement that each agenda being unanimously approved or approved by majority votes by how many votes, as well as the numbers of disapproved votes and abstained votes. Afterwards, the Chairman conducted the meeting in accordance with the Agendas in the notice as follows: Agenda 1. Acknowledgement of the matters notified by the Chairman of the Board. The Chairman thanked all Shareholders for attending the Annual General Meeting of Shareholders of the Company in this occasion. And there was no any matter notified to the meeting for acknowledgement. Agenda 2. Consideration for adoption of the Minutes of the Annual General Meeting of Shareholders of the Company for the year 2016 held on 27 April 2016. The Chairman requested the meeting to consider the Minutes of the Annual General Meeting of Shareholders of the Company for the year 2016, held on 27 April 2016. And the Company had distributed the copy of said Minutes to the Shareholders for consideration together with the notice of meeting. Resolution: After due consideration, the meeting resolved by a majority vote of the votes of the shareholders who attended and voted for adoption of the Minutes of the Annual General Meeting of Shareholders of the Company for the year 2016 held on 27 April 2016, as follows: No. of votes Percentage of the number Resolutions No. of Voters resolved of shares attending the (1 vote per share) meeting and voting Approved 190 1,908,486,784 100.00 Disapproved 2 54,025 0.00 Abstained - - - Total 192 1,908,540,809 100.00 Agenda 3. Consideration for acknowledgement of the performance results of the Company for the year 2016. The Chairman assigned Mr. Paisit Kaenchan, Chief Executive Officer, to explain the details in this agenda to the meeting for consideration. Mr. Paisit Kaenchan reported to the meeting together with showing visuals regarding the performance results of the Company for the year 2016 to the Shareholders for acknowledgement and consideration, covering the major issues as follows: 1. The business overview and the performance results of the Company for the year 2016 in comparison with the same matters of 2015 both in the hotel and real estate development businesses. 2. The information of real estate development business for the year 2016 of Hype Sukhumvit 13 Project and Hype Sukhumvit 11 Project in comparison with the same matters of 2015. 3. The summary of the performance results for the year 2016 of The Westin Grande Sukhumvit Hotel, Sheraton Hua Hin Resort and Spa Hotel and Sheraton Hua Hin Pranburi Villas Hotel.
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4. The details of the asset renovation of the hotels for the year 2015 and 2016. 5. The business plan of the Company for the year 2017 both in the hotel and real estate development businesses. 6. The construction progress and launching of Hyat Regency Bangkok Sukhumvit Hotel. 7. The investment plan of the real estate project in Rayong Province which consists of hotel, villas and condominium units for sale. Together with other information provided in the Annual Report which had been formerly distributed to the Shareholders together with the notice of meeting. The Chairman then proposed to the meeting for consideration. There were suggestions and inquiries from the Shareholders and the Board of Directors had answered such inquiries in the important matters as follows: 1. A shareholder (Mr. Sataporn Pungnirun) had inquiries as follows: 1.1 The performance result of the Company is appeared in the financial ratios demonstrated in the Annual Report, page 5, showing a gross margin of 65.45%, but with a margin of only 0.41%, a return on equity of 0.20%, and a return on assets of only. 0.09%. Mr. Chainid Adhyanasakul, the Director and Vice Chairman of the Executive Committee explained that the Board of Directors is aware of the said financial ratios and has consulted for a way to improve the performance result of the Company. The Company expected that in the year 2017, the Company will be able to transfer its ownership in Hyde Sukhumvit 11 project, which currently has the sales volume of Baht 2,000 Million, the Company will have revenue from the opening of the Hyatt Regency Bangkok Sukhumvit that will be launched for service in the end of 2017 and the launches of new projects in 2018 to continuously generate revenue from real estate development to the Company. 1.2 When will the Real Estate Investment Trust (REIT) of the Company be established? The Company should have specific timeline which Mr. Chainid Adhyanasakul explained that the Company was in the process of preparation for the submission of application to the Office of the SEC and the Company expected that the REIT of the Company will be established within the end of 2017. 2. A shareholder (Mr. Titipong Soponudomporn) had inquiries as follows: 2.1 The Company has invested a lot in its businesses, however, the Company has no return. The Chairman explained that the real estate business is a business that requires a lot of investment fund and takes a good amount of time to fully complete the development in order to fully recognize the revenue. 2.2 The Company has a large number of bills of exchange. Will the Company be able to roll over and will it affect the issuance of debentures? Miss Wilawun Leongnarktongdee, Director and Executive Committee, clarified that since the business of the Company consists of both hotel business and real estate development business, which is a business that requires lots of investment fund and takes a good amount of time to complete the development. Therefore, it is necessary for the Company to reserve sufficient financial liquidity to support the development of various projects whereby the Company has issued bills of exchange for liquidity enhancement and in 2017 the Company has fully paid the bills of exchange to the creditors. The main investment fund for the Company's projects will come from the issuance of debentures and loans from financial institutions.
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3. A proxy holder of a shareholder (Mr. Sompong Ratipitchayakul) had inquiries as follows: 3.1 The depreciation of the properties of the hotels to be re-launched at the end of this year which Mr. Sathit Kiatkrajai, Executive Vice President of Accounting & Control, informed that the hotels which will be re-launched at the end of this year has an investment value of approximately Baht 3,000 Million and will have a depreciation of about Baht 120-150 Million per year. 3.2 The investment in the properties of REIT to be established which Mr. Chainid Adhyanasakul explained that the REIT to be established this year will invest in Sheraton Hua Hin Resort & Spa. 3.3 Gross profit margin of Hyde Sukhumvit 11 project, which Mr. Chainid Adhyanasakul explained that Hyde Sukhumvit 11 project had gross profit margin of 34-35% 4. A shareholder (Mr. Supoj Uarchailertsakul) had inquiries and suggestions as follows: 4.1 The shareholder praised the Board of Directors for having vision to invest in real estate projects in Rayong Province by obtaining a large and beautiful land which is value for money. 4.2 Estimated investment fund and expected return from Rayong real estate project which Mr. Chainid Adhyanasakul informed that Rayong real estate project shall be divided into 3 parts whereby the villa part will have the investment value of approximately Baht 1,900 Million, the hotel part will have the investment value of Baht 1,500 Million and the condominium part will have the investment value of Baht 2,100 Million and have return on investment of approximately 30%. 4.3 The REIT which will invest in the properties of the Company will be in the form of leasehold or freehold? Miss Wilawun Leongnarktongdee clarified that REIT will invest in Sheraton Hua Hin Resort & Spa by purchasing the property from the Company. 4.4 Fees to be paid by the Company to the BTS for the connection to the BTS. Dr. Bhichit Rattakul, Vice Chairman of the Board and Chairman of the Executive Committee, clarified that currently the Company is in the negotiation process with BTS. The Company may propose to BTS to use spot for advertisement in exchange of the payment of the said fee. 5. A shareholder (Mr. Rittichai Yibcharoenporn) had inquiries and suggestions as follows: 5.1 Investment value and clientele of Rayong real estate project. Mr. Chainid Adhyanasakul clarified that Rayong real estate project in the part of villa and condominium will have the investment fund of approximately Baht 4,000 Million and the gross margin is expected to be at approximately 30%, or equivalent to approximately Baht 1,200 Million, which will be used to finance the construction of the hotel. The Company expects customers in the industrial estate of Rayong and neighboring provinces to be customers of this project. In addition, the Company had built large meeting rooms within the hotel to accommodate various business meetings, which will benefit the hotel room, food and beverage services and will also help to increase occupancy rates on weekdays. 5.2 The gross margin between real estate business and hotel business should be clearly separated in the Annual Report in order to clearly identify the potential of each business.
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5.3 Is there too many domestic hotel businesses? Mr. Chainid Adhyanasakul explained that the Company has invested in large hotels located in the business districts and near the BTS stations, where the land cost of the hotel is not very high, however, the current prices of land in the business districts and near the BTS stations is very high, therefore, the trend of new hotels in the business districts will be less while the room rate of those hotels is likely to be higher. 6. A proxy holder of a shareholder (Miss Jitt Sawitkul) inquired about the policy of the Company in combating the corruption including the comments of the Company which appeared in the Annual Report. The Chairman explained that the Company has a policy against corruption and the Company is ready to cooperate and comply with the regulations related to this matter already. There was no further shareholder’s inquiry. The Chairman then proposed to the meeting for acknowledgement. Resolution: After due consideration, the meeting resolved for acknowledgement of the performance results of the Company for the year 2016 and annual report. Agenda 4. Consideration for approval of the statements of financial position as at 31 December 2016, the statements of comprehensive income, changes in shareholders’ equity and cash flows for the year then ended. The Chairman assigned Mr. Sathit Kiatkrajai, Executive Vice President of Accounting & Control, to explain the details in this agenda to the meeting for consideration. Mr. Sathit Kiatkrajai summarized and showed visuals together with explained to the Shareholders for acknowledgement of the financial figures and key items of the statements of financial position as at 31 December 2016, the statements of comprehensive income, changes in shareholders’ equity and cash flows for the year end which have been audited and certified by the auditor including reviewed by the Audit Committee as well as approved by the Board of Directors of the Company in order to proposed to the Shareholders’ meeting for consideration with having the details in accordance with the financial statements of the Company which have been distributed to the Shareholders for consideration together with the notice. The Chairman then proposed to the meeting for consideration. A shareholder (Mr. Sataporn Pungnirun) inquired about the statement in the report of the auditor as reflected in the Annual Report page 177, which stated that "significant issues identified by the audit including significant deficiencies in the internal control system that I have encountered during my audit". Miss Krongkaew Limpkittikul, the auditor from EY Co., Ltd., clarified that the statement is required by the Federation of Accounting Professions to add for the first time and it is a statement that must be informed that the auditors and the regulators have communicated in the said matter only and the auditor has approved the Company's financial statements for the year 2016 unconditionally. There was no further shareholder’s inquiry. The Chairman then proposed to the meeting for voting. Resolution: After due consideration, the meeting resolved by a majority vote of the votes of the shareholders who attended and voted for approval of the statements of financial position as at 31 December 2016, the statements of comprehensive income, changes in shareholders’ equity and cash flows for the year then ended, as follows:
6 Enclosure 1 (supporting documents for the consideration of Agenda 2)
No. of No. of votes Percentage of the number Resolutions Voters resolved of shares attending the (1 vote per share) meeting and voting Approved 256 1,914,488,707 99.99 Disapproved 3 158,025 0.01 Abstained 1 42,500 0.00 Total 260 1,914,689,232 100.00 Agenda 5. Consideration for acknowledgement of an appropriation of profits and non-payment of dividends for the fiscal year 2016. The Chairman assigned Mr. Paisit Kaenchan, Chief Executive Officer, to explain the details in this agenda to the meeting for consideration. Mr. Paisit Kaenchan explained to the meeting that in the previous year of 2016, the Company has the net profits according to the separate financial statements in the amount of 123,194,125 Baht, and it has no carried accumulated losses. And pursuant to the law and the Company’s Articles of Association which stipulate that the Company shall appropriate a reserve fund, from the annual net profit, at least five (5) percent of the annual net profit less the accumulated loss carried forward (if any) until the reserve fund reaches not less than ten (10) percent of the registered capital. The Company then appropriated a part of profits as a legal reserve in the amount of 6,159,706 Baht, resulting that it has the remaining amount of the profits that could be paid as a dividend in the amount of 117,034,419 Baht. And since the Company is still necessitate to use the said net profits in order for Hype Sukhumvit 11 Project and Hyatt Regency Sukhumvit Bangkok Hotel. Therefore, the Board of Directors of the Company then proposed to the Shareholders meeting for acknowledgement of the appropriation of a part of profits of the year 2016 as a legal reserve in the amount of 6,159,706 Baht and non-payment of dividends for the Company’s performance results of the year 2016 to the Shareholders. There was no further shareholder’s inquiry. The Chairman then proposed to the meeting for acknowledgement. Resolution: After due consideration, the meeting resolved for acknowledgement of the appropriation of a part of profits as a legal reserve in the amount of 6,159,706 Baht and acknowledgement of the non-payment of dividends for the Company’s performance results of the year 2016.
Agenda 6. Consideration of the election of new directors replacing those retiring by rotation. The Chairman assigned Mr. Somchai Treeratanaphitak, Executive Vice President of Legal Affairs, to explain the details in this agenda to the meeting for consideration. Mr. Somchai Treeratanaphitak explained to the meeting that this agenda shall be considered to comply with the Public Limited Companies Act and the Article of Association of the Company which provide that one-third of the Directors were required to retire from offices every year in the Annual General Meeting of Shareholders, whereby the Directors who had been in the longest term in office were required to retire by rotation. But they were entitled to be re-elected to resume the positions of the Directors of the Company. The Company had twelve Directors in total. Therefore, there were four Directors who were to retire from offices by rotation in this occasion, as follows:
7 Enclosure 1 (supporting documents for the consideration of Agenda 2)
1. Mr. Vitavas Vibhagool Director and Executive Committee 2. Miss Wilawun Leongnarktongdee Director and Executive Committee 3. Mr. Amarin Narula Director and Executive Committee 4. Mr. Wattana Suthipinijtham Independent Director, Audit Committee and Risk Management Committee Provided that the said four directors were the persons who have the appropriated qualification, knowledge, ability and experience related to the businesses of the Company which they were beneficial the business operation of the Company. It then proposed to the Shareholders’ meeting for consideration of the re-election of the said four directors to their offices as the directors for another term, whereby the Company had distributed the details of background of four Directors who were proposed to the meeting for consideration as the Directors to the Shareholders for consideration together with the notice. Therefore, the Board of Directors of the Company then proposed to the Shareholders meeting for consideration of the election of new directors replacing those being retired by rotation as follows: 1. Re-election of Mr. Vitavas Vibhagool, Miss Wilawun Leongnarktongdee and Mr. Amarin Narula, being the Directors due to retire by rotation in this occasion, to resume the offices of the Directors of the Company for another term. 2. Re-election of Mr. Wattana Suthipinijtham, being the Director due to retire by rotation in this occasion, to resume the offices of the Director, Independent Director and Audit Committee of the Company for another term. Moreover, Miss Wilawun Leongnarktongdee is an assistant of chief executive officer of Property Perfect Public Company Limited (“PF”) which is the Company operating in the development of real estate and may be deemed as the same and competing business with the Company’s businesses. However, PF is the major Shareholder of Thai Property Public Company Limited (“TPROP”) and TPROP is the major Shareholder of Metro Premier Holding Company Limited (“METRO”), whereby PF, TPROP and METRO are the shareholders of the Company in the total amount of 1,222,658,476 shares, being equivalent to 42.32% of the paid-up capital of the Company. Therefore, it deems that the Company is the affiliated company of PF. Mr. Amarin Narulais is the director of Chiang Mai River Side Plaza Hotel Company Limited which is the Company operating the hotel business in Chiangmai Province and may be deemed as the same and competing business with the Company’s businesses. However, the Company has no hotel business in Chiangmai Province. Mr. Vitavas Vibhagool and Mr. Wattana Suthipinijtham are not the directors in other companies operating the same and competing businesses with the Company’s businesses. And before consideration and voting, the four Directors who were proposed for nomination as the Directors have expressed their wishes to leave from the meeting room temporarily so that the Shareholders meeting would consider and vote freely. The Chairman invited the said four Directors to leave from the meeting room temporarily. The Chairman proposed to the meeting for consideration. And there was no shareholder’s inquiry. The Chairman then proposed to the meeting for voting. Resolutions: After due consideration, the meeting resolved for the election of new directors replacing those being retired by rotation as follows:
8 Enclosure 1 (supporting documents for the consideration of Agenda 2)
1. Re-election of Mr. Vitavas Vibhagool, Miss Wilawun Leongnarktongdee and Mr. Amarin Narula, being the Directors due to retire by rotation in this occasion, to resume the offices of the Directors of the Company for another term. 2. Re-election of Mr. Wattana Suthipinijtham, being the Director due to retire by rotation in this occasion, to resume the offices of the Director, Independent Director and Audit Committee of the Company for another term. Whereby the meeting resolved by a majority vote of the votes of the shareholders who attended and voted as follows: (1) Mr. Vitavas Vibhagool No. of No. of votes Percentage of the number Resolutions Voters resolved of shares attending the (1 vote per share) meeting and voting Approved 268 1,915,029,444 100.00 Disapproved 2 54,025 0.00 Abstained 1 42,500 0.00 Total 271 1,915,125,969 100.00 (2) Miss Wilawun Leongnarktongdee No. of No. of votes Percentage of the number Resolutions Voters resolved of shares attending the (1 vote per share) meeting and voting Approved 268 1,915,029,444 100.00 Disapproved 2 54,025 0.00 Abstained 1 42,500 0.00 Total 271 1,915,125,969 100.00 (3) Mr. Amarin Narula No. of No. of votes Percentage of the number Resolutions Voters resolved of shares attending the (1 vote per share) meeting and voting Approved 268 1,915,029,444 100.00 Disapproved 2 54,025 0.00 Abstained 1 42,500 0.00 Total 271 1,915,125,969 100.00 (4) Mr. Wattana Suthipinijtham No. of No. of votes Percentage of the number Resolutions Voters resolved of shares attending the (1 vote per share) meeting and voting Approved 268 1,915,029,444 100.00 Disapproved 2 54,025 0.00 Abstained 1 42,500 0.00 Total 271 1,915,125,969 100.00
9 Enclosure 1 (supporting documents for the consideration of Agenda 2)
Therefore, the Board of Directors of the Company would comprise 12 members as follows: 1. Mr. Wichai Thongtang Chairman of the Board 2. Dr. Bhichit Rattakul Vice Chairman of the Board and Chairman of the Executive Committee 3. Mr. Chainid Adhyanasakul Director and Vice Chairman of the Executive Committee 4. Mr. Vitavas Vibhagool Director and Executive Committee 5. Miss Wilawun Leongnarktongdee Director and Executive Committee 6. Mr. Suradej Narula Director and Executive Committee 7. Mr. Amarin Narula Director and Executive Committee 8. Mr. Paisit Kaenchan Director, Executive Committee and Chief Executive officer 9. Mrs. Phornsiri Manoharn Independent Director and Chairman of Risk Management Committee 10. Mr. Pornchai Kittipanyangam Independent Director and Chairman of Audit Committee 11. Mr. Wattana Suthipinijtham Independent Director and Audit Committee 12. Mr. Amarit Pansiri Independent Director and Audit Committee Agenda 7. Consideration for approval of the remuneration of the Directors for the year 2017. The Chairman assigned Mr. Somchai Treeratanaphitak, Executive Vice President of Legal Affairs, to explain the details in this agenda to the meeting for consideration. Mr. Somchai Treeratanaphitak explained to the meeting that this agenda shall be considered to comply with the Public Limited Companies Act and the Article of Association of the Company which provide that the payment of the remuneration to the Board of Directors of the Company is required to approve from the Shareholders Meeting. The Board of Directors of the Company has considered the remuneration to the Directors in comparison with the rates of the directors’ remuneration of the same business group as well as the appropriateness for the scope of duties and responsibilities of the Directors. He then proposed to the meeting for fixing of the remuneration to the Board of Directors for the year 2017 in the form of attendance fees with the same rate as approved in the year 2016, as follows: 1. The Attendance fees for the meeting of Board of Directors in an amount of Baht 50,000.- per meeting per person. 2. The Attendance fees for the meeting of Audit Committee and Risk Management Committee in an amount of Baht 50,000.- per meeting per person. 3. The Attendance fees for the meeting of Executive Committee in an amount of Baht 10,000.- per meeting per person and fixing the attendance fees for Executive Committee in the amount not exceeding 1,500,000.- Baht per year.
10 Enclosure 1 (supporting documents for the consideration of Agenda 2)
The Chairman proposed to the meeting for consideration. And there was no shareholder’s inquiry. The Chairman then proposed to the meeting for voting. Resolution: After due consideration, the meeting resolved by a majority vote of the votes of the shareholders who attended and were eligible to vote as follows: No. of No. of votes Percentage of the number Resolutions Voters resolved of shares attending the (1 vote per share) meeting and voting Approved 265 1,913,863,699 99.94 Disapproved 5 1,219,775 0.06 Abstained 1 42,500 0.00 Total 271 1,915,125,969 100.00 Approval for the remuneration of the Board of Directors for the year 2017 in the form of attendance fees with the same rate as approved in the year 2016, as follows: 1. The Attendance fees for the meeting of Board of Directors in an amount of Baht 50,000.- per meeting per person. 2. The Attendance fees for the meeting of Audit Committee and Risk Management Committee in an amount of Baht 50,000.- per meeting per person. 3. The Attendance fees for the meeting of Executive Committee in an amount of Baht 10,000.- per meeting per person and fixing the attendance fees for Executive Committee in the amount not exceeding 1,500,000.- Baht per year. Agenda 8. Consideration of the appointment of the auditors and fixing the auditor’s remunerations for the year 2017. The Chairman assigned Mr. Sathit Kiatkrajai, Executive Vice President of Accounting & Control, to explain the details in this agenda to the meeting for consideration. Mr. Sathit Kiatkrajai explained to the meeting that this agenda shall be considered to comply with the Public Limited Companies Act and the Article of Association of the Company which provide that that every Annual General Meeting of Shareholders shall appoint the auditors and fix the auditor’s remunerations. Provided that, the Board of Directors had considered at the deliberation and recommendation of the Audit Committee to be appropriate for the Shareholders meeting to consider the appointment of the Auditors of EY Office Limited by Mr. Narong Puntawong, CPA Registration No. 3315 and/or Mrs. Chonlaros Suntiasvaraporn, CPA Registration No. 4523 and/or Miss Krongkaew Limkittikul, CPA Registration No. 5874 as the Company’s auditors for the year 2017 whereby any one of the above-mentioned auditors would be authorized to audit, perform and set his/her signature in its audit report due to it had been considered that they have the qualifications as prescribed by the Office of Securities Exchange Commission and the experience and expertise in auditing including the satisfactory performance result, and to consider the fixing of the remuneration of the Auditors in the amount not exceeding 2,490,000.- Baht. Moreover, EY Office Limited would also acting as the auditor of the Company’s subsidiaries. Provided that the amounts of remuneration of the auditors in the previous years are as follows:
11 Enclosure 1 (supporting documents for the consideration of Agenda 2)
Names of the Company No. Year 2015 Year 2016 Year 2017 and its Subsidiaries 1 Grande Asset Hotels and 2,090,000 2,090,000 2,490,000 Property Public Company Limited 2 Honor Business 910,000 910,000 1,010,000 Company Limited 3 Grande Equity Development 100,000 100,000 100,000 Company Limited 4 Owendelle Company Limited 100,000 100,000 100,000 Total 3,200,000 3,200,000 3,700,000 EY Office Limited and the auditors proposed as the auditors of the Company and its subsidiary companies had no relationship or any interest with the Company or its subsidiary companies, managements or the related persons in such a way which may have an impact on performing their task independently. The Chairman then proposed to the meeting for consideration. There were suggestions and inquiries from the Shareholders and the Board of Directors had answered such inquiries in the important matters as follows: 1. A proxy holder of a shareholder (Miss Jitt Sawitkul) inquired about the Company's annual audit fee for the year 2017 which was significantly increased from the year 2016. Mr. Pornchai Kittipanyangam, Independent Director and Chairman of Audit Committee, informed that the Federation of Accounting Professions requires the auditor to disclose significant matters from the audit in the annual financial statement pursuant to the new accounting standard and in the year 2017 there will be an increase in the number of transactions and items. In addition, the Company has tried to negotiate with the auditor not to adjust the remuneration rate for a few years. After that, the auditor of the Company further clarified that the compensation of the Company is the audit fee for the annual financial statements and the quarterly review of financial statements only with the exclusive of additional service fee. 2. A shareholder (Mr. Sataporn Pungnirun) suggested that the Company should clearly specify the annual audit fee and the quarterly review of financial statements fee in the documents to be sent to the shareholders. In addition, the shareholders acknowledged from some directors of the Federation of Accounting Profession that the new accounting standard should not be used as a cause to increase Company's auditing fee and the new accounting standard is just to categorize the items which need to be checked to see if the auditor has fully complied. 3. A shareholder inquired about the audit fee of Grand Equity Development Co., Ltd. which according to the Annual Report, it had ceased its operation. Mr. Sathit Kiatkrajai explained that even that company has ceased its operating but it is still a subsidiary of the Company, which is a listed company in the Stock Exchange of Thailand. As a result, the subsidiary is required to prepare quarterly and annual financial statements. There was no further shareholder’s inquiry. The Chairman then proposed to the meeting for voting.
12 Enclosure 1 (supporting documents for the consideration of Agenda 2)
Resolution: After due consideration, the meeting resolved by a majority vote of the votes of the shareholders who attended and voted as follows: No. of No. of votes Percentage of the number Resolutions Voters resolved of shares attending the (1 vote per share) meeting and voting Approved 243 1,878,057,984 98.07 Disapproved 26 36,242,110 1.89 Abstained 5 837,400 0.04 Total 274 1,915,137,494 100.00 Approval for the appointment of the Auditors of EY Office Limited by Mr. Narong Puntawong, CPA Registration No. 3315 and/or Mrs. Chonlaros Suntiasvaraporn, CPA Registration No. 4523 and/or Miss Krongkaew Limkittikul, CPA Registration No. 5874 as the Company’s auditors for the year 2017 and fixing the remuneration of the Auditors in the amount not exceeding 2,490,000.- Baht. Agenda 9. Consideration for approval of the issuance and offering of the Debentures in the amount not exceeding 4,000 Million Baht. The Chairman assigned Miss Wilawun Leongnarktongdee, Director and Executive Committee, to explain the details in this agenda to the meeting for consideration. Miss Wilawun Leongnarktongdee explained to the meeting that since the Company is still necessitated to procure the source of fund in order for use as the working capital and reserve fund for the business operations of the Company and its subsidiaries, repayment of loan and supporting the investment and development in real estate projects of the Company and its subsidiaries, including the hotels, the villas and the residential condominiums for sale, the Board of Directors of the Company then proposed to issue and offer the Debentures in the amount not exceeding 4,000 Million Baht as appeared in the Details of Issuance and Offering of Debentures in accordance with the documents which were distributed to the shareholders for consideration together with the notice of the meeting. However, Miss Wilawun requested to summary the details of the said Debentures to the meeting for consideration as follows: Type All types and all forms of the Debentures (subordinated or unsubordinated and secured or unsecured), depending on prevailing market conditions at such time the Debentures being issued and offered in each occasion. Currency Thai Baht and/or any foreign currency by using the exchange rate at such time of issuance and offering of the Debentures. Total value of Total and outstanding amount not exceeding 4,000 Million Baht at each Debentures time. The Company could issue and offer a single set or multiple sets in entirety and/or multiple occasions. However, in the event of the Debentures are redeemed prior to maturity and/or due date of redemption, the Company will be able to issue new set of the Debentures, whereby the value of new set of the Debentures being offered and the outstanding value of the existing Debentures which are not yet redeemed, are not exceeding the total value of Debentures in accordance with this resolution or equivalent. Maturity Not over 5 years from the date of issuance of Debentures in each occasion.
13 Enclosure 1 (supporting documents for the consideration of Agenda 2)
Offering To be offered the Debentures in entirety and/or multiple occasions and/or as a project and/or revolving basis whereby they will be offered in local and overseas to a public offering and/or a private placement and/or local and/or foreign institutional investors and/or high net worth investors in entirety or multiple occasions in accordance with the rules as specified by the relevant Notification of the Securities and Exchange Commission and/or Notification of the Capital Market Supervision Board and/or other regulations which are enforced at the moment of issuance and offering of the Debentures. Premature The Debentures’ holders and the Company may or may not be entitled to Redemption the right to premature redemption, subject to the terms and conditions of each issuance of the Debentures. Interest Rate Depending on the market conditions at the time of issuance and offering of the Debentures or in compliance with the terms and conditions of the Debentures being issued at such occasion. However, it will be subject to the relevant Notification of the Capital Market Supervision Board and/or other notifications or regulations in force at such time of issuance and offering of the Debentures. Objectives For using as the working capital and reserve fund in the business operations of the Company and its subsidiaries and for repayment of the loan and for supporting the investment and development of the real estate projects of the Company and its subsidiaries, including the hotels, the villas for sale and the condominiums for sale. Authorization The Board of Directors of the Company or the Executive Committee of the Company or the authorized director(s) of the Company or the person(s) designated by the Board of Directors or the Executive Committee or the authorized director(s) of the Company shall have the authorities to determine criteria, conditions and other details relating to the issuance and offering of the Debentures in the parts which have not yet been determined as necessary and appropriate according to the relevant regulations, notifications, articles and laws; such as, name, type of offering, amount to be issued and offered for each time, type, guarantee, collateral, offering price per unit, maturity, due date of redemption, redemption prior to maturity, other rights and obligations in accordance with type of the Debentures issued in each time, interest rate, methods for payment of principal and interest, methods and terms for offering and allotment and details of offering, registrar and representative, appointment of advisor or other persons relating to the issuance of the Debentures, making of credit rating including taking the Debentures for registration of listing on the Thai Bond Market, Stock Exchange of Thailand, Securities Dealing Center or any secondary markets including any organizations, as well as being empowered to apply for the permission, disclosure of information and doing any acts with the relevant agencies and to do any and all acts and things as necessary and appropriate in relation to the issuance and offering of the Debentures.
14 Enclosure 1 (supporting documents for the consideration of Agenda 2)
The Chairman then proposed to the meeting for consideration. There were suggestions and inquiries from the Shareholders and the Board of Directors had answered the inquiries in the important issues as follows: 1. A shareholder (Mr. Sataporn Pungnirun) had inquiries as follows: 1.1 Types of debentures that are specified as all types and forms of debentures (subordinated or unsubordinated or guarantee or no guarantee) should be clearly added that it is not convertible bond and the maturity shall be more than 5 years since currently the trend of interest is upward. In addition, the Company's real estate projects will require a long period of time to construct and if the maturity of the debentures is longer, it will help to reduce the problem of roll over consideration. The Chairman informed that the debentures of the Company to be approved at this time are for sure not convertible bonds and if the maturity of the debentures is too long, it will make it more difficult to sell. 1.2 What is the Company's Debt-to-Equity ratio? Miss Wilawun Leongnarktongdee informed that the Company will maintain the Debt-to-Equity ratio of not exceeding 2 times. 2. A shareholder (Mr. Titipong Soponudomporn) inquired about the interest rate of the debentures to be approved and whether the Company has debenture that will be matured this year? Miss Wilawun Leongnarktongdee clarified that the interest rate of debentures is based on market condition at the time of issuance and offering or pursuant to the terms and conditions of debentures issued at that period, and in 2017, the Company has no debenture that will be matured. 3. A shareholder (Miss Jitt Sawitkul) requested the Company to report the progress of debentures issuance to the shareholders in the next meeting. There was no further shareholder’s inquiry. The Chairman then proposed to the meeting for voting. Resolution: After due consideration, the meeting resolved by a majority vote of the votes of the shareholders who attended and were eligible to vote as follows: No. of No. of votes Percentage of the number Resolutions Voters resolved of shares attending the (1 vote per share) meeting and voting Approved 270 1,914,317,809 99.96 Disapproved 4 777,275 0.04 Abstained 1 42,500 0.00 Total 275 1,915,137,584 100.00 Approval for the Company to issue and offer the Debentures in the amount not exceeding 4,000 Million Baht with the details as proposed to the Shareholders for consideration by Miss Wilawun Leongnarktongdee. Agenda 10. To consider and approve the reduction of the registered capital and the amendment of Clause 4 of the Memorandum of Association of the Company regarding the reduction of the registered capital. The Chairman assigned Miss Somsri Kiattirarat, Legal Counselor, to explain the details in this agenda to the meeting for consideration.
15 Enclosure 1 (supporting documents for the consideration of Agenda 2)
Miss Somsri Kiattirarat explained to the meeting that the Company will increase its registered capital as per the details to be proposed for consideration in the following agendas. And in accordance with the law, it specifies that the increase of the registered capital of the Public Company Limited from the amount of its registered capital by the issuance of new shares may be made after all shares of the Company have been completely sold and paid-up in full, or in case the shares have not been completely sold, the remained shares would be the shares issued for accommodation of the Convertible Debentures or the Warrants. Therefore, in compliance with the law, the Board of Directors of the Company then proposed to the Shareholders meeting for consideration and approval of the reduction of the registered capital of the Company from the existing amount of 2,889,040,000.- Baht to 2,889,039,237.- Baht, divided into 2,889,039,237 registered ordinary shares, with the par value of 1.- Baht per share by canceling the 763 unissued ordinary shares, with the par value of 1.- Baht per share, totaling 763.- Baht which were the registered ordinary shares remaining from the allotment for accommodation of the payment of dividend to the shareholders of the Company in accordance with the resolution of Annual General Meeting of Shareholders of the Company for the year 2015, and the amendment to Clause 4 of the Memorandum of Association of the Company to be in line with the reduction of the registered capital of the Company as follows:
“Clause 4. Registered capital being 2,889,039,237 Baht Divided into 2,889,039,237 Shares With a par value of 1 Baht each Shares are classified into Ordinary Shares of 2,889,039,237 Shares Preference Shares of --- Shares”
The Chairman proposed to the meeting for consideration. And there was no shareholder’s inquiry. The Chairman then proposed to the meeting for voting.
Resolution: After due consideration, the meeting resolved by a majority vote not less than three-fourth of the total number of votes of shareholders attending the meeting and were eligible to vote as follows:
No. of No. of votes Percentage of the number Resolutions Voters resolved of shares attending the (1 vote per share) meeting and voting Approved 270 1,914,317,809 99.96 Disapproved 3 761,525 0.04 Abstained 2 58,250 0.00 Total 275 1,915,137,584 100.00
Approval for the reduction of the registered capital of the Company from the existing amount of 2,889,040,000.- Baht to 2,889,039,237.- Baht by canceling the 763 unissued ordinary shares, with the par value of 1.- Baht per share and the amendment to Clause 4 of the Memorandum of Association of the Company to be in line with the reduction of the registered capital of the Company with the details as proposed to the Shareholders for consideration by Miss Somsri Kiattirarat.
16 Enclosure 1 (supporting documents for the consideration of Agenda 2)
Agenda 11. To consider and approve the increase of the registered capital and the amendment of Clause 4 of the Memorandum of Association of the Company regarding the increase of the registered capital. The Chairman assigned Miss Somsri Kiattirarat, Legal Counselor, to explain the details in this agenda to the meeting for consideration. Miss Somsri Kiattirarat explained to the meeting that in order for use as the working capital and reserve fund for the business operations of the Company and its subsidiaries, repayment of loan and supporting the investment and development in real estate projects of the Company and its subsidiaries, including the hotels, the villas and the residential condominiums for sale, the Board of Directors of the Company then proposed to the Shareholders meeting for consideration and approval of the Company to increase the registered capital from the existing amount of 2,889,039,237.- Baht to 5,000,000,000.- Baht; namely, to increase the registered capital by another 2,110,960,763.- Baht by issuing 2,110,960,763 new ordinary shares, with the par value of 1.- Baht per share, and the amendment to Clause 4 of the Memorandum of Association of the Company to be in line with the increase of the registered capital of the Company as follows: “Clause 4. Registered capital being 5,000,000,000 Baht Divided into 5,000,000,000 Shares With a par value of 1 Baht each Shares are classified into Ordinary Shares of 5,000,000,000 Shares Preference Shares of --- Shares”
The Chairman proposed to the meeting for consideration. And there was no shareholder’s inquiry. The Chairman then proposed to the meeting for voting.
Resolution: After due consideration, the meeting resolved by a majority vote not less than three-fourth of the total number of votes of shareholders attending the meeting and were eligible to vote as follows:
No. of No. of votes Percentage of the number Resolutions Voters resolved of shares attending the (1 vote per share) meeting and voting Approved 270 1,914,227,059 99.95 Disapproved 4 868,025 0.05 Abstained 1 42,500 0.00 Total 275 1,915,137,584 100.00
Approval for the increase of the registered capital of the Company from the existing amount of 2,889,039,237.- Baht to 5,000,000,000.- Baht by issuing 2,110,960,763 new ordinary shares, with the par value of 1.- Baht per share, and the amendment to Clause 4 of the Memorandum of Association of the Company to be in line with the increase of the registered capital of the Company with the details as proposed to the Shareholders for consideration by Miss Somsri Kiattirarat.
17 Enclosure 1 (supporting documents for the consideration of Agenda 2)
Agenda 12. To consider and approve the allotment of capital increase ordinary shares. The Chairman assigned Miss Somsri Kiattirarat, Legal Counselor, to explain the details in this agenda to the meeting for consideration. Miss Somsri Kiattirarat explained to the meeting that this agenda is the following matter from the increase of the registered capital of the Company in the previous agenda. The Board of Directors of the Company then proposed to the Shareholders meeting for consideration and approval of the allotment of capital increase ordinary shares of the Company in the amount of 2,110,960,763 shares, with the par value of 1.- Baht per share, totaling 2,110,960,763.- Baht with the details as follows: 1. Approval for the Company to allot and offer the newly issued capital increase ordinary shares in the amount of 866,711,771 shares, with the par value of 1.- Baht per share to the existing Shareholders of the Company in proportion to the number of shares held by each of them (Right Offering) at the ratio of 10 existing shares to 3 new shares (fractions of shares being disregarded), at the offering price of 1.- Baht per share which the price equals to the par value of share of the Company is 1.- Baht per share, whereby the Board of Directors of the Company is authorized to consider the fixing of the names of the shareholders who are entitled to subscribe the capital increase ordinary shares of the Company (Record Date). 2. In case where the existing Shareholders have not subscribed all of the said allotted ordinary shares in accordance with Clause 1. above or there are remaining unsubscribed shares in any case whatsoever, the said remaining shares shall be allotted and offered to the existing Shareholders of the Company, who have subscribed and made payment for the ordinary shares for the amount in excess of their entitlements, together with the subscription and payment of the ordinary shares as subscribed under Clause 1., at the price of 1.- Baht per share, whereby the Executive Committee or the authorized directors of the Company are authorized to consider the allotment and offer of the said remaining shares to the existing Shareholders, who have subscribed and made payment for the ordinary shares for the amount in excess of their entitlements, under the following criteria and conditions: (a) In case the number of the ordinary shares as subscribed by the existing Shareholders for the amount in excess of their entitlements aforesaid is more than the number of the remaining shares, the allotment of the said remaining shares shall be made to the existing Shareholders who have subscribed the shares for the amount in excess of their entitlements and paid for the subscription price in proportion to the existing shareholding until they are no more or they cannot be allotted due to being the fraction of shares. (b) In case the number of the ordinary shares as subscribed by the existing Shareholders for the amount in excess of their entitlements aforesaid is less than the number of the remaining ordinary shares, the allotment of the said remaining shares shall be made to all those existing Shareholders who have subscribed the shares for the amount in excess of their entitlements and paid for the subscription price in proportion to the existing shareholding until no existing Shareholders wish to subscribe the said shares anymore.
18 Enclosure 1 (supporting documents for the consideration of Agenda 2)
Provided that the Company shall return the subscription money without interest for the amount covering the unallotted additional number of the ordinary shares of the relevant existing Shareholders within 14 days from the closing date for the subscription. In addition, the allotment of newly issued capital increase ordinary shares in accordance with (a) and (b) above in any case whatsoever, will not cause to any existing Shareholders who have subscribed the shares for the amount in excess of their entitlements, hold the shares of the Company categorized to make the tender offer of entire shares of the Company (Tender Offer) in accordance with the Notification of the Capital Market Supervisory Board No. Tor Jor. 12/2554 Re: Rules, Conditions and Procedures for the Acquisition of Securities for Business Takeover or under the characteristic as infringement of the restriction of foreign shareholding as stated in the Articles of Association of the Company. (c) In case there are still unsubscribed ordinary shares remaining after the allotment mentioned in (a) and (b) above, the above remaining ordinary shares shall be allotted and offered to investors in private placement (Private Placement) categorized under the Notification of the Capital Market Supervisory Board No. Tor Jor. 72/2558 Re: Approval for the Listed Companies to Offer Newly Issued Shares to Investors in Private Placement in accordance with the details in Clause 3. 3. Approval for the Company to allot and offer the newly issued capital increase ordinary shares in the amount of 1,244,248,992 shares, with the par value of 1.- Baht per share together with the unsubscribed ordinary shares remaining after the allotment to the existing Shareholders in accordance with Clause 2. above (if any), for offering in entirety or in portions for offering in lots from time to time to investors in private placement categorized under the Notification of the Capital Market Supervisory Board No. Tor Jor. 72/2558 Re: Approval for the Listed Companies to Offer Newly Issued Shares to Investors in Private Placement which such persons are not connected persons of the Company, whereby the Board of Directors of the Company or the person who designated by the Board of Directors of the Company shall have the authority to determine the offering price of the shares at the best market price in accordance with the market condition during the offering period to the investor(s) which shall not lower than 1.- Baht per share and shall not lower than the following price: (1) The weighted average of the Company’s share price trading on the Stock Exchange of Thailand (“SET”) for not lower than 7 consecutive trading days but not exceeding 15 consecutive trading days prior to the determination date of the offering price of such shares (“Market Price”), whereby such weighted average of share price is required to use the average price of shares trading in each day. Provide that, the determination date of offering price is required to backward not exceeding 3 trading days prior to the first date of offering shares to the investor(s). However, the Board of Directors of the Company may determine the discount on the offering price but shall not exceed 10% of such Market Price. (2) The price which is determined by the book building method surveyed by the securities company. In this regard, the Board of Directors of the Company or the person who designated by the Board of Directors of the Company shall offer the entire shares within the period not exceeding 12 months from the date of the Shareholders meeting of the Company has resolved for the approval of such offering shares.
19 Enclosure 1 (supporting documents for the consideration of Agenda 2)
4. For the allotment and offering of capital increase ordinary shares of the Company above, the Board of Directors and/or the Executive Committee and/or the authorized director(s) of the Company and/or the person(s) designated by the Board of Directors or the Executive Committee or the authorized directors of the Company shall have the authorities to consider the fixing of other details regarding the allotment and offering of capital increase ordinary shares, such as (1) searching of investors in private placement; (2) fixing of the date, time and place for subscription and payment of the capital increase ordinary shares; (3) fixing of the terms, conditions and details regarding the allotment and offering of capital increase ordinary shares; (4) negotiation, entry into agreement and execution of relevant documents and agreements regarding the allotment and offering of capital increase ordinary shares; and (5) execution of applications for permission and necessary and relevant evidence regarding such allotment and offering of capital increase ordinary shares, including the contacting and submission of applications for such permission, documents and evidence to relevant authorities or agencies, the listing of such capital increase ordinary shares on the Stock Exchange of Thailand and being empowered to take any other action which is necessary and appropriate for the allocation and offering of such capital increase ordinary shares as deemed appropriate by complying with the laws and/or regulations concerned. In addition, The Company shall be entitled to register the change of the paid-up capital with the Registrar of Public Limited Companies from time to time in accordance with the periodic payments of the shareholders and investors in each time. Moreover, for the convenience in effecting the registration of the capital increase of the Company, which certain words or statements in the registration documents or Minutes of the Shareholders meeting might be subject to amend by the order of the Registrar, the Shareholders meeting is requested to authorize to the authorized directors of the Company or their authorized representatives to amend any words or statements in the documents and/or applications related to the registration of the capital increase of the Company, forthwith without seeking an approval from the meeting of the Shareholders The details of the allotment and offering of the capital increase ordinary shares in this occasion appeared in the documents which were distributed to the shareholders for consideration together with the notice of the meeting The Chairman proposed to the meeting for consideration. There were suggestions and inquiries from the Shareholders and the Board of Directors had answered the inquiries in the important issues as follows: 1. A shareholder (Mr. Titipong Soponudomporn) suggested that the Company should allocate and offer capital increased ordinary shares by right offering and private placement at the same time so there will be no advantage or disadvantage. 2. A shareholder (Mrs. Patcharin Chanmaeta) inquired about the record date to specify shareholders who have the right to subscribe the capital increased ordinary shares of the Company. The Chairman explained that pursuant to the details as proposed to the shareholders for consideration, the Board of Directors has been authorized to determine the record date for the right to subscribe the capital increase ordinary shares of Company. 3. A shareholder (Mr. Rittichai Yibcharoenporn) inquired about the offering price of the capital increased ordinary shares for private placement and was of the opinion that the offering price should be higher than the offering price for the right offering. The Chairman explained that the offering price cannot be set at this moment, however, the offering price must not be less than the market price during the offering period to investors and shall not be not less than the price of Baht 1 per share.
20 Enclosure 1 (supporting documents for the consideration of Agenda 2)
There was no further shareholder’s inquiry. The Chairman then proposed to the meeting for voting. Resolution: After due consideration, the meeting resolved by a majority vote of the votes of the shareholders who attended and voted as follows: No. of No. of votes Percentage of the number Resolutions Voters resolved of shares attending the (1 vote per share) meeting and voting Approved 270 1,914,227,059 99.95 Disapproved 4 868,025 0.05 Abstained 1 42,500 0.00 Total 275 1,915,137,584 100.00 Approval for the allotment of capital increase ordinary shares in the amount of 2,110,960,763 shares, with the par value of 1.- Baht per share, totaling 2,110,960,763.- Baht with the details as proposed to the Shareholders for consideration by Miss Somsri Kiattirarat. Agenda 13. Other Businesses. There were suggestions and inquiries from the Shareholders and the Board of Directors had answered the additional inquiries as follows: 1. A shareholder (Ms. Preawkwan Jiaranaitrakul) opined that since she used to work in Rayong province and had seen the changes whereby Rayong province has a large number of petrochemical plants and there are thousands of employees thus she suggested that the Company should consider developing a sport complex in order to accommodate this group of customers. 2. A proxy holder of a shareholder (Mr. Sompong Ratipitchayakul) inquired about the appraised value of the properties to be sold to REIT and the holding of trust units in the REIT, including the tentative date of completion. Miss Wilawun Leongnarktongdee informed that the said matter is in the process of preparation of the submission of REIT establishment application and the appraised value is expected to be not less than Baht 1,500 Million, whereby the Company will hold some part of the trust units and the said matter is expected to be completed within 2017. Conclusion There were no further business to transact, the Chairman thanked the Shareholders who attend to the meeting and gave continued support to the Company, and called the meeting to be adjourned at 12.25 hrs.
(Signed) -Signature- Chairman of the Meeting (Mr. Wichai Thongtang)
(Signed) -Signature- Company Secretary (Mr. Somchai Treeratanaphitak)
m/emin/agm-grande 61/en1-minutes agm 60.doc
21 Enclosure 3 (supporting documents for the consideration of Agenda 6)
Name list and profiles of directors nominated to be elected as directors to replace those retiring by rotation
Name-Surname Mr. Wichai Thongtang Type of proposed Authorized director director Present Position Chairman of the Board and in the Company Authorized director Age 71 years Nationality Thai Family relationship -None- between directors Education - Master’s Degree in Political Science, Thammasat University. Background - Bachelor Degree in Law, Thammasat University. - Thai Institute of Directors Association (IOD) : Directors Certification Program (DCP), 2005. - Thai Institute of Directors Association (IOD) : Finance for Non-Finance Director (FN), 2005. - Thai Institute of Directors Association (IOD) : Audit Committee Program (ACP), 2004. - Thai Institute of Directors Association (IOD) : Directors Accreditation Program (DAP), 2004. Years of Directorship 9 years. in the Company Current Position in Other Organizations ● In listed companies -None- ● In non-listed companies - Chairman of the Board, Sriracha Nakorn Hospital Public Company Limited. - Chairman of the Board, Thai Medical Center Public Company Limited. - Chairman of the Board, Siam Medical Company Limited. - Chairman of the Board, Paolo Medic Company Limited. - Chairman of the Board, Phayathai 1 Hospital Company Limited. - Chairman of the Board, Phayathai 2 Hospital Company Limited. - Chairman of the Board, Phayathai 3 Hospital Company Limited. - Chairman of the Board, Wichai Thongtang Legal Office Company Limited. ● In other organization that -None- may cause any conflict of interests to the Company
1 Z:\Legal Department\My Document 2018\AGM 2018\GA\Notice AGM 2018\Eng\en3- retire dir.doc Enclosure 3 (supporting documents for the consideration of Agenda 6)
Name list and profiles of directors nominated to be elected as directors to replace those retiring by rotation
Work Experience 2016 - Present Chairman of the Board, Grande Asset Hotels and Property Public Company Limited. 2010 - 2016 Director and Chairman of Executive Committee, Grande Asset Hotels and Property Public Company Limited. 2011 - Present Chairman of the Board, - Thai Medical Center Public Co., Ltd. - Siam Medical Co., Ltd. 2009 - Present Chairman of the Board, Paolo Medic Co., Ltd. 2005 - Present Chairman of the Board, Sriracha Nakorn Hospital Public Co., Ltd. 2003 - Present Chairman of the Board, - Phayathai 1 Hospital Company Limited. - Phayathai 2 Hospital Company Limited. - Phayathai 3 Hospital Company Limited. 2001 - Present Chairman of the Board, Wichai Thongtang Legal Office Co., Ltd. Number of shares -None- held in the Company Meeting Attendance 6 times of total 6 times of Board of Directors Meeting. Other No history record on committing a criminal offence on property with dishonesty.
2 Z:\Legal Department\My Document 2018\AGM 2018\GA\Notice AGM 2018\Eng\en3- retire dir.doc Enclosure 3 (supporting documents for the consideration of Agenda 6)
Name list and profiles of directors nominated to be elected as directors to replace those retiring by rotation
Name-Surname Mr. Bhichit Rattakul Type of proposed Authorized director director Present Position Vice Chairman of the Board, in the Company Chairman of Executive Committee and Authorized director Age 72 years Nationality Thai Family relationship -None- between directors Education - Doctor of Philosophy in Industrial Microbiology (Biotechnology), Background Brigham Young University, U.S.A. - Master of Science in Industrial Microbiology, Brigham Young University, U.S.A. - Bachelor of Science, Chulalongkorn University Years of Directorship 4 years. in the Company Current Position in Other Organizations ● In listed companies -None- ● In non-listed companies - Chairman of the Board, Thai Property Public Company Limited. - Chairman of the Board, Metro Premier Holding Co., Ltd. - Chairman of the Board, Pacific Estate Development Co., Ltd. - Director, T Utilities Co., Ltd. - Advisor, Asian Disaster Preparedness Center (ADPC). - Executive Director, Anti-air Pollution & Environmental Protection Foundation. ● In other organization that -None- may cause any conflict of interests to the Company Work Experience 2016 - Present Vice Chairman of the Board and Chairman of Executive Committee, Grande Asset Hotels and Property Public Company Limited. 2015 - 2016 Director and Vice Chairman of Executive Committee, Grande Asset Hotels and Property Public Company Limited. 2016 - Present Director, T Utilities Co., Ltd.
3 Z:\Legal Department\My Document 2018\AGM 2018\GA\Notice AGM 2018\Eng\en3- retire dir.doc Enclosure 3 (supporting documents for the consideration of Agenda 6)
Name list and profiles of directors nominated to be elected as directors to replace those retiring by rotation
2015 - Present Chairman of the Board, - Thai Property Public Company Limited. - Metro Premier Holding Co., Ltd. - Pacific Estate Development Co., Ltd. 2012 - Present Advisor, Asian Disaster Preparedness Center (ADPC) 2014 - 2017 Expert Committee, National Environment Board 2012 - 2016 President, Navamindradhiraj University 2007 - 2012 Executive Director, Asian Disaster Preparedness Center (ADPC). 2003 - 2014 Chairman of the Board, Krungthep Land Public Co., Ltd. 1996 - 2000 Governor of Bangkok Metropolitan. 1992 - Present Executive Director, Anti Air Pollution and Environmental Protection Foundation. Number of shares -None- held in the Company Meeting Attendance 6 times of total 6 times of Board of Directors Meeting. Other No history record on committing a criminal offence on property with dishonesty.
4 Z:\Legal Department\My Document 2018\AGM 2018\GA\Notice AGM 2018\Eng\en3- retire dir.doc Enclosure 3 (supporting documents for the consideration of Agenda 6)
Name list and profiles of directors nominated to be elected as directors to replace those retiring by rotation
Name-Surname Mr. Paisit Kaenchan Type of proposed Authorized director director Present Position Director, Executive Committee in the Company and Chief Executive Officer of Hotel Business Age 57 years Nationality Thai Family relationship -None- between directors Education - Executive Master of Business Administration, Sasin Graduate Background Institute of Business Administration. - Master of Development Administration, Western Michigan University, Michigan, U.S.A. - Master of Arts, Political Science, Western Michigan University, Michigan, U.S.A. - Bachelor of Arts, Political Science, Thammasat University. - Thammasat Leadership Program Class 1/2012, Thammasat University. - Certificate in Hotel Real Estate Investment & Asset Management 2008, Cornell University, U.S.A. - Thai Institute of Directors Association (IOD): Risk Management Committee Program (RMP), 2014. Role of Compensation Committee Program (RCC), 2014. Role of Nomination and Governance Committee Program (RNG), 2014. Advance Audit Committee Program (AACP), 2013. Director Certificate Program (DCP), 2005. Current Position in Other Organizations ● In listed companies Independent Director & Audit Committee, AEC Securities Public Company Limited. ● In non-listed companies - Director, AIM REIT Management Co., Ltd. - Director, Hospitality Advisory Services Co., Ltd. ● In other organization that -None- may cause any conflict of interests to the Company
5 Z:\Legal Department\My Document 2018\AGM 2018\GA\Notice AGM 2018\Eng\en3- retire dir.doc Enclosure 3 (supporting documents for the consideration of Agenda 6)
Name list and profiles of directors nominated to be elected as directors to replace those retiring by rotation
Work Experience 2016 - Present Director, Executive Committee and Chief Executive Officer of Hotel Business, Grande Asset Hotels and Property Public Company Limited. 2016 - Present Director, AIM REIT Management Co., Ltd. 2013 - Present Independent Director & Audit Committee, AEC Securities Public Company Limited. 2012 - Present Director, Hospitality Advisory Services Co., Ltd. 2010 - 2016 Principle, Hospitality Advisory Services (Thailand) 2010 - 2012 Chief Representative-Hotel Development, Thailand, Marriott Hotels & Resorts Asia. 2007 - 2009 SEVP & Chief Operation Officer, TCC Land Development. 2007 - 2009 SEVP & Chief Investment Officer, TCC Hotel Group. 2006 Chief Executive Officer, Grande Asset Hotels and Property Public Company Limited. 1996 - 2006 Executive Vice President - Hotel Management, The Erawan Group Public Company Limited. 1995-1996 Vice President of Private Fund Management, JF Thanakom Co., Ltd. 1988-1995 Vice President of Provident Fund Management, Tisco Finance and Securities Public Company Limited. Number of shares -None- held in the Company Meeting Attendance 6 times of total 6 times of Board of Directors Meeting. Other No history record on committing a criminal offence on property with dishonesty.
6 Z:\Legal Department\My Document 2018\AGM 2018\GA\Notice AGM 2018\Eng\en3- retire dir.doc Enclosure 3 (supporting documents for the consideration of Agenda 6)
Name list and profiles of directors nominated to be elected as directors to replace those retiring by rotation
Name-Surname Mr. Amarit Pansiri Type of proposed Director, Independent Director and director Audit Committee Present Position Director, Independent Director and in the Company Audit Committee Age 63 years Nationality Thai Family relationship -None- between directors Education - Master Degree in Business Administration, Faculty of Commerce Background and Accountancy, Chulalongkorn University. - Bachelor Degree in Liberal Arts Major General Administration, Krirk University. - Certificate of Cargo Sales Training from Lufthansa Training Centre Seeheim, West Germany. - Certificate of Mini MBA, Thammasart University. - Certificate of Business Administration Management and Psychology Institute. Years of Directorship 16 years. in the Company Current Position in Other Organizations ● In listed companies -None- ● In non-listed companies - Executive Committee, Chiang Mai River Side Plaza Hotel Company Limited. - Managing Director, The Cargo Flights Company Limited. - Managing Director, Excel Parcel Systems Company Limited. - Chairman of Executive Committee, Yamato Unyu (Thailand) Company Limited. - Managing Director, Excel Transport International Company Limited. ● In other organization that -None- may cause any conflict of interests to the Company
7 Z:\Legal Department\My Document 2018\AGM 2018\GA\Notice AGM 2018\Eng\en3- retire dir.doc Enclosure 3 (supporting documents for the consideration of Agenda 6)
Name list and profiles of directors nominated to be elected as directors to replace those retiring by rotation
Work Experience 2003 - Present Independent Director and Audit Committee, Grande Asset Hotels and Property Public Company Limited.
2006 - Present Executive Committee,
Chiang Mai River Side Plaza Hotel Company Limited.
2002 - Present Managing Director,
The Cargo Flights Company Limited.
1996 - Present Managing Director, Excel Parcel Systems Company Limited. 1990 - Present Chairman of Executive Committee, Yamato Unyu (Thailand) Company Limited. 1985 - Present Managing Director, Excel Transport International Company Limited. Number of shares -None- held in the Company Meeting Attendance 5 times of total 6 times of Board of Directors Meeting and 6 times of total 7 times of Audit Committee Meeting. Other No history record on committing a criminal offence on property with dishonesty.
Additional information to consider the election of Independent Director
● Kin Relationship with executive directors or major shareholders of the Company and Subsidiaries. -None-
● Relationship with the Company / Subsidiaries / Associates or any business registrations that may cause conflict of interest at the present. -None-
● Significant business relationship that may restrain one from performing his job independently. -None-
8 Z:\Legal Department\My Document 2018\AGM 2018\GA\Notice AGM 2018\Eng\en3- retire dir.doc Enclosure 4
Scope of Duties and Responsibilities of the Audit Committee
1. To review the Company financial reporting to ensure that it is accurate and adequately disclosed; 2. To review the Company internal control system and internal audit system to ensure that they are suitable, adequate and efficient. To determine the Internal Audit Unit has independency, as well as to approve the appointment, transfer, and dismissal of the Chief of Internal Audit Unit or any other similar unit in charge of an internal audit and internal control; 3. To review the Company full compliance with the rules of law of the securities and exchange, the Stock Exchange's regulations, and other related to the business of the Company; 4. To consider, review, select, and propose an independent person to be the Company Auditor, and to propose suitable remuneration, as well as attending a meeting with an independent auditor at least once a year without Company Management; 5. To review the connected transactions, or the transactions that may lead or have potential to lead to the conflict of interests, to ensure that these transactions are in full compliance with the relevant laws, SET Rules and Regulation, and the Exchange's, are reasonable, and are for the highest benefit of the Company; 6. To prepare and disclose in the Company's annual report, an Audit Committee's Report which must be signed by the Chairman of the Audit Committee. The report must at least contain the following: (a) an opinion on the accuracy, completeness, fairness, and reliability of the Company financial report, (b) an opinion on the adequacy of the Company internal control system, (c) an opinion on full compliance with relevant and applicable law includes SEC Law, SET Rules and Regulation, and any other laws relating to the Company business, (d) an opinion on the qualification and suitability of an Independent Auditor, (e) an opinion on the transactions that may lead to conflicts of interests, (f) the number of the Audit Committee meetings, and the attendance record of such meetings attended by each committee member, (g) an opinion or observation of the Audit Committee from the conduct of its duty and responsibility in accordance with the charter, and (h) other transactions which, according to the Audit Committee opinion, should be known to the shareholders, and general public investors, subject to the scope of duties and responsibilities assigned by the Company Board of Directors; 7. To perform any other duty as assigned by the Company Board of Directors, with the consent of the audit committee.
m/emin/agm-grande 61/en4-duty audit committee.doc Enclosure 5 (supporting documents for the consideration of Agenda 8)
Grande Asset Hotels and Property Public Company Limited Amount of Auditor’s Remunerations for the years 2016-2018
No. Names of the Company Year 2018 Year 2017 Year 2016 and its Subsidiaries
1 Grande Asset Hotels and 2,500,000 2,490,000 2,090,000 Property Public Company Limited
2 Honor Business 690,000 1,010,000 910,000 Company Limited
3 Grande Equity Development 100,000 100,000 100,000 Company Limited
4 Owendelle Company Limited 420,000 100,000 100,000
5 Grand Star Company Limited 280,000 -- --
Total 3,990,000 3,700,000 3,200,000
Remarks 1. Amount of Auditor’s Remunerations for the years 2016 and 2017 were proposed by the auditors of EY Office Limited. 2. Amount of Auditor’s Remunerations for the year 2018 has been proposed by the auditors of Pricewaterhousecoopers ABAS Company Limited. 3. Grand Star Company Limited has been registered on 22 May 2017 which is a joint venture company between Grande Asset Hotels and Property Public Company Limited, Property Perfect Public Company Limited and Sumitomo Forestry Singapore Ltd.
m/emin/agm-grande 61/en5-audit remuneration Enclosure 6 (supporting documents for the consideration of Agenda 9)
Information Memorandum on Acquisition of Assets and Tender Offer Royal Orchid Hotel (Thailand) Public Company Limited (Schedule 2)
Grande Asset Hotels and Property Public Company Limited
1 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Grande Asset Hotels and Property Public Company Limited Information Memorandum on Acquisition of Assets and Tender Offer Royal Orchid Hotel (Thailand) Public Company Limited (Schedule 2)
1. Information Memorandum Schedule 1 According to the Board of Directors Meetings of Grande Asset Hotels and Property Public Company Limited (the “Company” or “GRAND”) No. 5/2017, held on 9 November 2017 and No. 6/2017, held on 27 December 2017 had resolved to approve for the entering into of the investment of ordinary shares of Royal Orchid Hotel (Thailand) Public Company Limited (“ROH”), a listed company in the Stock Exchange of Thailand, with the details as follows. • Resolved for approval of the entering into of the investment of ordinary shares of ROH, whereby the Company will purchase the ordinary shares of ROH from the shareholders of ROH in the number which empower the Company to control the management of ROH and assignment of Mr. Chainid Adhyanasakul and/or Mr. Vitavas Vibhagool to be the authorized person(s) of the Company to negotiate and agree with the shareholders of ROH including to disclose the entering into of the said transactions to the Stock Exchange of Thailand when it is in accordance with the above conditions of the Board of Directors of the Company. And then Mr. Chainid Adhyanasakul and Mr. Vitavas Vibhagool have proceeded in accordance with the above conditions of the Board of Directors of the Company. They then hereby report and disclose the entering into of the said transactions to the Stock Exchange of Thailand on the important matters as follows:
o Approval for the purchase of ordinary shares of ROH which are held by Starwood Hotels (Thailand) Co., Ltd. (“Starwood”) in the number of 41,250,235 shares with the par value of 10.- Baht per share, equivalent to 44% of the total number of paid-up shares of ROH, at the price of 35.- Baht per share, totaling of 1,443,758,225.- Baht.
o Approval for the purchase of ordinary shares of ROH which are held by Thai Airways International Public Company Limited (“THAI”) in the number of 22,500,000 shares with the par value of 10.- Baht per share, equivalent to 24% of the total number of paid-up shares of ROH, at the price of 41.- Baht per share, totaling of 922,500,000.- Baht. • Resolved for approval of the submission to the Shareholders’ meeting for consideration and approval of the entering into of the investment of ordinary shares of ROH and making of the tender offer of entire securities of ROH which is in accordance with the Notification of the Capital Market Supervisory Board No. Tor Jor. 12/2554 Re: Rules, Conditions and Procedures for the Acquisition of Securities for Business Takeover, because the Company will acquire the ordinary shares of ROH more than 50% of the total voting right of ROH.
2 Enclosure 6 (supporting documents for the consideration of Agenda 9)
In case the successful acquisition of ordinary shares of ROH from THAI and Starwood, this would result in the Company holding 63,750,235 shares of ROH in total or equivalent to 68% of the total number of paid- up ROH shares. And pursuant to Clause 4 of the Notification of the Capital Market Supervisory Board No. ThorJor. 12/2554 Re: Rules, Conditions and Procedures for the Acquisition of Securities for Business Takeovers which specifies that “Any person, who has purchased or taken any other action which results in his acquisition of shares, or his becoming holder of shares, of any business such that his shareholding at the end of any particular day reaches or exceeds any trigger point specified below, shall make a tender offer for all securities of that business: (1) 25 percent of the total voting rights of the business; (2) 50 percent of the total voting rights of the business; (3) 75 percent of the total voting rights of the business”, the Board of Directors of the Company then proposes to the Extraordinary General Meeting (Change to Annual General Meeting 2018 according to resolution of the Board of Directors meeting 1/2018 on the 14 February 2018) of Shareholders of the Company to consider and approve the mandatory tender offer of all securities of ROH (“MTO”). The entering into of the transactions are considered as the acquisition of assets as prescribed in the Notification of the Capital Market Supervisory Board No. ThorJor. 20/2551 re: Rules on Entering into Material Transactions Deemed as Acquisition or Disposal of Assets and the Notification of the Board of Directors of the Stock Exchange of Thailand Re: Disclosure of Information and Other Acts of Listed Company Concerning the Acquisition and Disposition of Assets B.E. 2547 (“Notification of Acquisition or Disposition of Assets”) with the total highest transaction size of 297.89% of the Company’s’ total operating profit as per the financial statement for 12-month period ended 30th September 2017 under the criteria of the Company’s operating profit, resulting that it is categorized as Class 1 transaction which has the transaction value equal to or higher than 50%. Therefore, the Company is required to disclose the Information Memorandum on Acquisition of Assets to the SET, and to convene the Shareholders’ meeting to consider and approve for entering into of the transactions with voting of at least three-fourths of the total votes of shareholders attending the meeting and are eligible to vote, excluding shareholders with the conflict of interest including to appoint the independent financial advisor for providing the opinion to the shareholders of the Company in relation to the acquisition of assets. The Information Memorandum on Acquisition of Assets of the Company in this occasion, which have the details are as follows. 1.1 Date, Month, Year of Transaction 9th November 2017 The Board of Directors of the Company had resolved to approve in principle for the entering into of the investment of ordinary shares of ROH. 27th December 2017 The Board of Directors of the Company had resolved to approve for the entering into of the investment of ordinary shares of ROH and making the tender offer for all securities of ROH
3 Enclosure 6 (supporting documents for the consideration of Agenda 9)
29th March 2018 Extraordinary General Meeting of Shareholders No. 1/2018 (Canceled according to resolution of the Board of Directors meeting 1/2018 on the 14 February 2018) 20th April 2018 Annual General Meeting 2018 according to resolution of the Board of Directors meeting 1/2018 on the 14 February 2018 After approval of Annual Taking transfer of the shares from Starwood and THAI and making General Meeting 2018 payment of the purchase price of shares to them which shall be done according to resolution of the within 1 week after the shareholders approve the transaction and tender Board of Directors meeting offer 1/2018 on the 14 February 2018
The Company will begin the MTO procedure immediately after the Company has been completely taken transfer of the shares of ROH from THAI and Starwood. However, the Company expected that it will be able to complete the said share transfers within 1 week after the Extraordinary General Meeting (change to Annual General Meeting 2018 according to resolution of the Board of Directors meeting 1/2018 on the 14 February 2018) of Shareholders of the Company No. 1/2018 has resolved to approve for the entering into of the investment of ordinary shares of ROH and making the tender offer for all securities of ROH, whereby the Company will notify to the shareholders for acknowledgement through the disclosure information system of the Stock Exchange of Thailand. At present, the Company has no policy to delist the securities of ROH from the Stock Exchange of Thailand. 1.2 The parties involved and the relationship with the Company THAI Transaction Purchaser : Grande Asset Hotels and Property Public Company Limited
Seller : Thai Airways International Public Company Limited Relationship with the Company : - no relationship - Starwood Transaction Purchaser : Grande Asset Hotels and Property Public Company Limited Seller : Starwood Hotels (Thailand) Company Limited Relationship with the Company : - no relationship -
4 Enclosure 6 (supporting documents for the consideration of Agenda 9)
MTO Purchaser : Grande Asset Hotels and Property Public Company Limited Seller : All shareholders of ROH Relationship with the Company : At present: - no relationship At MTO: The Company will be a major shareholder with shareholding of 68% of the total number of paid-up shares of ROH 1.3 General characteristics and size of transactions The Company will take transfer the shares of ROH from THAI and Starwood immediately after the approval from the Extraordinary General Meeting (Change to Annual General Meeting 2018 according to resolution of the Board of Directors meeting 1/2018 on the 14 February 2018) of Shareholders of the Company No. 1/2018. This would result in the Company holding 63,750,235 shares of ROH in total or equivalent to 68% of the total number of paid-up shares of ROH. And pursuant to Clause 4 of the Notification of the Capital Market Supervisory Board No. ThorJor. 12/2554 Re: Rules, Conditions and Procedures for the Acquisition of Securities for Business Takeovers which specifies that “Any person, who has purchased or taken any other action which results in his acquisition of shares, or his becoming holder of shares, of any business such that his shareholding at the end of any particular day reaches or exceeds any trigger point specified below, shall make a tender offer for all securities of that business: (1) 25 percent of the total voting rights of the business; (2) 50 percent of the total voting rights of the business; (3) 75 percent of the total voting rights of the business”, the Board of Directors of the Company then proposes to the Extraordinary General Meeting (Change to Annual General Meeting 2018 according to resolution of the Board of Directors meeting 1/2018 on the 14 February 2018) of Shareholders of the Company to consider and approve the mandatory tender offer of all securities of ROH, whereby the Company will make a tender offer for 29,999,765 shares of ROH in total or equivalent to 32% of the total number of paid-up shares of ROH at the par value of 10.- Baht per share, by payment with money at the offering price of 41.- Baht per share (the highest price of the shares of ROH which will be acquired by the Company in between the period of 90 days before the submission of the tender offer of all securities of ROH. However, the Company and its subsidiaries are not the current shareholders of ROH) amounting to 1,229,990,365.- Baht. The said transactions are considered as an acquisition of assets under the Notification of Acquisition or Disposal of Assets which can be calculated the size of transaction by referring to the consolidated financial statements of the Company as of 30th September 2017 are as follows:
5 Enclosure 6 (supporting documents for the consideration of Agenda 9)
THAI and Starwood Transactions Criteria Calculation Size of Transaction 1. Net tangible assets (NTA) (68% x 809.28 mm 1) / 2,559.88 mm 2 21.50% 2. Net profit3 (68% x 117.37 mm) / 39.40 mm 202.57% 3. Total value of consideration 2,366.26 mm 4 / 9,499.23 mm 2 24.91% 4. Equity share value - None - The Highest Transaction Size 202.57% MTO Transaction Criteria Calculation Size of Transaction 1 2 1. Net tangible assets (NTA) (32% x 809.28 mm ) / 2,559.88 mm 10.12% 3 2. Net profit (32% x 117.37 mm) / 39.40 mm 95.32% 3. Total value of consideration 1,229.99 mm 4 / 9,499.23 mm 2 12.94% 4. Equity share value - None - The Highest Transaction Size 95.32% Acquisition of all securities of ROH Criteria Calculation Size of Transaction 1. Net tangible assets (NTA) (100% x 809.28 ลบ. 1) / 2,559.88 mm 2 31.61% 2. Net profit3 (100% x 117.37 ลบ.) / 39.40 mm 297.89% 3. Total value of consideration 3,596.25 mm 4 / 9,499.23 mm 2 37.86% 4. Equity share value - None - The Highest Transaction Size 297.89%
Note: 1. ROH's consolidated financial statements ended 30th September 2017, reviewed by a certified public accountant 2. The Company’s consolidated financial statements ended 30th September 2017, reviewed by a certified public accountant. 3. Net profits of ROH and the Company for the last 12 months ending 30th September 2017 4. The net value of assets which will be acquired by the Company
Therefore, the entering into of the said transactions are considered as the transaction of acquisition of assets with the highest transaction size of 297.89% under the criteria of the Company’s operating profit, resulting that it is categorized as Class 1 transaction which has the transaction value equal to or higher than 50%. Hence, the Company is required to disclose the Information Memorandum on Acquisition of Assets to the SET, and to convene the Shareholders’ meeting to consider and approve for entering into of the transactions with voting of at least three-fourths of the total votes of shareholders attending the meeting and are eligible to vote, excluding shareholders with the conflict of interest including to appoint the independent financial advisor for providing the opinion to the shareholders of the Company in relation to the acquisition of assets.
6 Enclosure 6 (supporting documents for the consideration of Agenda 9)
1.4 Characteristics of the acquired assets Royal Orchid Hotel (Thailand) Public Company Limited, formerly known as Italthai International Hotel Company Limited, located on No. 2 Captain Bush Lane, Charoenkrung Road, Bangrak Sub-district, Bangrak District, Bangkok, established with a registered capital of 80,000,000 Baht in June, 1978 with the objective of running hotel business (the current name is Royal Orchid Sheraton Hotel & Towers). Currently, ROH has registered capital of 937,500,000 Baht. The construction was completed and the hotel started to partially operate in December 1982. ROH was listed on the Stock Exchange of Thailand in July 1989. Currently, it has the registered and paid-up capital of 937,500,000 Baht, divided into 93,750,000 ordinary shares with a par value of 10 Baht per share. The major shareholders as of 30th March 2017 are as follows; # of shareholding (shares) Percentage Starwood Hotels (Thailand) Company Limited 41,250,235 44.00% MBK Hotels and Resorts Company Limited 27,998,051 29.86% Thai Airways International Public Company Limited 22,500,000 24.00%
The board of directors of ROH consists of 12 directors as follows 1. Mr. Somchai Bunsuk Chairman of the Board / Independent Director 2. Mr. Suphadet Phunphiphat Director 3. Mr. Suwet Thirawachirakun Director 4. Ms. Christina Shui-Yin Chan Director 5. Mr. Karl Hudson Director 6. Mr. Sanjay Malhotra Director 7. Mr. Narongchai Wongthanavimok Director 8. Mr. Krittaphon Chantalitanon Director 9. Mr. Pakorn Thawisin Independent Director/Chairman of the Audit Committee 10. Gen. Vinit Krachangson Independent Director/Audit Committee 11. Mr. Serm Phenjati Independent Director 12. Lt. Annop Sutkawathin Independent Director/Audit Committee
At present, ROH primary engages in hotel business in type of first class hotel with a total of 726 spacious guestrooms and suites, providing various facilities and services to the customers such as meeting room conference room, exhibit room, International restaurants, bars, swimming pool, tennis court, and private pier. ROH also entered into an operating agreement with Sheraton Overseas Management Corporation, the United States of America.
7 Enclosure 6 (supporting documents for the consideration of Agenda 9)
In addition, ROH invests into two subsidiaries i.e., Thai Royal Orchid Real Estate Company Limited which carries on the businesses of letting of land, buildings and equipment and Sheraton Royal Orchid Company Limited which does not operate any business. The Company holds the shares of 99.99% and 51.00%, respectively. 1.5 Total value of consideration, basis of determining the value of consideration, and terms of payment THAI Transaction The total value of consideration for acquisition of the ROH’ ordinary shares in the number of 22,500,000 shares, equivalent to 24% of the total number of paid-up shares of ROH, at the price of 41.- Baht per share, total amount of 922,500,000.- Baht, whereby the Company will pay the total amount of the purchase price to THAI and taking transfer of the shares on the date of share transfer after receiving the approval from the Extraordinary General Meeting (Change to Annual General Meeting 2018 according to resolution of the Board of Directors meeting 1/2018 on the 14 February 2018) of Shareholders of the Company No. 1/2018. The determination of the value of consideration in this transaction became from the proposal of the purchase price of the said ordinary shares by the Company to THAI in comparison with other purchasers by referring to the previous market price of shares of ROH and the value of assets of ROH in order for fixing of the expected offering price of ordinary shares of ROH which will be accepted by THAI. Hence, the company had made a deposit of THB 10,000,000 which shall be return once THAI transfer ROH share to the company. However, if ROH shares cannot be transferred to the company due to any mistake did not caused by the company, THAI shall return this deposit too. Starwood Transaction The total value of consideration for acquisition of the ROH’ ordinary shares in the number of 41,250,235 shares, equivalent to 44% of the total number of paid-up shares of ROH, at the price of 35.- Baht per share, total amount of 1,443,758,225.- Baht, whereby the Company will pay a deposit of 10% of the purchase price, which shall be deemed as a part of the purchase price. The balance will be paid to Starwood on the date of share transfer after receiving the approval from the Extraordinary General Meeting (Change to Annual General Meeting 2018 according to resolution of the Board of Directors meeting 1/2018 on the 14 February 2018) of Shareholders of the Company No. 1/2018. The determination of the value of consideration in this transaction became from the negotiation between the Purchaser and the Seller by referring to the market price of shares of ROH in between the period of the negotiation of both parties. Hence, the company had made a deposit of THB 114,380,000 (10% of the transaction size) which shall be returned, only, if Starwood does not comply with the agreement.
8 Enclosure 6 (supporting documents for the consideration of Agenda 9)
MTO Transaction In case of all shareholders of ROH accept the tender offer of the Company, the total value of consideration for acquisition of the ROH’ ordinary shares in the number of 29,999,765 shares, equivalent to 32% of the total number of paid-up shares of ROH, at the price of 41.- Baht per share, (the highest price of the shares of ROH which will be acquired by the Company in between the period of 90 days before the submission of the tender offer of all securities of ROH. However, the Company and its subsidiaries are not the current shareholders of ROH) amounting to 1,229,990,365.- Baht, whereby the Company will pay in full amount to the shareholders of ROH who accept the tender offer for all securities of the Company. 1.6 Value of assets purchased - The total value of assets purchased from the transaction with Starwood is the 41,250,235 ordinary shares of ROH, with the par value of 10.- Baht per share, totaling of 412,502,350 Baht. - The total value of assets purchased from the transaction with THAI is the 22,500,000 ordinary shares of ROH, with the par value of 10 Baht per share, totaling of 225,000,000 Baht. - The total value of assets purchased from the MTO is the 29,999,765 ordinary shares of ROH, with the par value of 10 Baht per share, totaling of 229,997,650 Baht. The book value of ordinary shares of ROH in accordance with the consolidated financial statements of ROH as at 30th September 2017 is of 9.14 Baht per share. Provided that the closed price of shares of ROH on the Stock Exchange of Thailand on 23 January 2018 is of 37.- Baht per share.
1.7 Benefits expected to be derived from the Transaction The key asset under ROH is the Royal Orchid Sheraton Hotel & Towers (the “Hotel”) which is a freehold land with 4-star hotel of 726 rooms. The Hotel is located in a strategic location along with the Chao Phraya River. And under the rise in tourism both locally and internationally as well as the support from the government in expanding tourism of Thailand, the Company views that the acquisition of ROH would bring long term benefits to the Company. And it will increase the ability of business competition of the hotel business against with other entrepreneurs and also contribute the reliability of business operation of Company as well as encourage the expansion of consumer base of the Company. In addition, the hospitality portfolio of the Company will become more diverse, which includes hotel in the center of Bangkok and outside of Bangkok which will make the company's performance likely to grow and progress in the future.
1.8 Source of Funds The Company will use the working capital and the capital fund which is expected to obtain from the offering of capital increase shares to the existing shareholders (According to the resolution of the Annual General Meeting of Shareholders of the Company for 2017, held on 24 April 2017 which had resolved to approve for the allotment and offering of the 866,711,771 capital increase ordinary shares, at the offering
9 Enclosure 6 (supporting documents for the consideration of Agenda 9)
price of 1.- Baht per share to the existing shareholders of the Company) including the loan from a financial institution in order for entering into of the three transactions without any condition affecting the rights of shareholders.
1.9 Conditions for entering into the transaction The acquisition of asset in this occasion will be completed when the Extraordinary General Meeting (Change to Annual General Meeting 2018 according to resolution of the Board of Directors meeting 1/2018 on the 14 February 2018) of Shareholders of the Company No. 1/2018 has resolved to approve for the entering into of the said acquisition of assets with voting of at least three-fourths of the total votes of shareholders attending the meeting and are eligible to vote, excluding shareholders with the conflict of interest.
1.10 Opinion of the Board of Directors of the Company concerning the transactions The Board of Directors of the Company viewed that the entering into of the said transactions deems appropriate and beneficial to the Company in long term period. And it will increase the ability of business competition of the hotel business against with other entrepreneurs and also contribute the reliability of hotel business operation of Company as well as encourage the expansion of consumer base of the Company. In addition, the averaged price of shares of ROH offered to THAI, Starwood and all shareholders of ROH is of 38.36 Baht per share which is nearly the market price of shares of ROH in the Stock Exchange of Thailand in the preceding time and it deems appropriate with the Company for making the tender offer of all securities of ROH.
1.11 Opinion of the Audit Committee and/or the director of the Company that is different from the opinion of the Board of Directors of the Company The Audit Committee has the opinion in line with the opinion of the Board of Directors of the Company, and none of the Director had the different opinion. 2. Responsibility of the Board of Directors for the Information Memorandum The Board of Directors has carefully reviewed the information contained in this Information Memorandum and certified that the information in this Information Memorandum is correct, complete, not falsified, not misleading to other person and not lacking in any information ought to be disclosed which is material. 3. Opinion of the Independent Expert on the Entry into Transactions of Asset Acquisition and Disposal - None –
10 Enclosure 6 (supporting documents for the consideration of Agenda 9)
4. Details of Debt 4.1 The total amount of bill of exchange as at 31 December 2017 As at 31 December 2017, the outstanding bill of exchange issued by the company value at 249.45 million Baht which have the interest rate of 4.55% per year, has no collateral and mature on January 2018. However, between January and February 2018, the company issued new bill of exchange value at 300.00 million Baht to repay the due bill of exchange value at 250.00 million Baht. 4.2 The total amount of loans with specified repayment period of the Company and its subsidiaries as at 1 December 2016, and liabilities to place assets as collateral Type of Loan Amount (million Baht) Collateral Long-term loans due in 1 year from financial 753.78 Land title deed number institutions 3768 in Phra Ka Nhong District including all the building Net Long-term loans due in 1 year from financial 468.84 Land title deed number institutions 915 and 1187 in Klong Teoy District including all the building 4.3 The total value of other liabilities, including overdrafts of the Company and its subsidiaries as at 1 December 2016, and liabilities to place assets as collateral
Type of liabilities Amount (million Baht) Collateral Trade account and other payable 444.27 None Short term bill of exchange 249.45 None Debentures and debt certificates (Due in more than 1 449.72 None year) Debentures and debt certificates (Due in less than 1 2,493.18 None year) Short term loan from related parties 149.62 None Employee benefit obligation 62.79 None Deferred tax liabilities 16.76 None
11 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Detail of outstanding debentures as at 31 December 2017 are as followed • Name Debenture of Grande Asset Hotels and Property Public Company Limited No. 1/2016 which mature in 2019 Offering Value 700.00 Million Baht Par Value 1,000 Baht Offering Method Via institution and/or high net worth investors Offering Date 17 February 2016 Maturity Date 14 February 2019 Interest Rate Fixed at 5.70% per year • Name Debenture of Grande Asset Hotels and Property Public Company Limited No. 2/2016 which mature in 2018 Offering Value 150.00 Million Baht Par Value 1,000 Baht Offering Method Via private placement to less than 10 investors Offering Date 16 March 2016 Maturity Date 19 March 2018 Interest Rate Fixed at 5.20% per year • Name Debenture of Grande Asset Hotels and Property Public Company Limited No. 3/2016 which mature in 2019 Offering Value 200.00 Million Baht Par Value 1,000 Baht Offering Method Via private placement to less than 10 investors Offering Date 27 May 2016 Maturity Date 20 May 2019 Interest Rate Fixed at 5.35% per year
12 Enclosure 6 (supporting documents for the consideration of Agenda 9)
• Name Debenture of Grande Asset Hotels and Property Public Company Limited No. 4/2016 which mature in 2018 Offering Value 300.00 Million Baht Par Value 1,000 Baht Offering Method Via institution and/or high net worth investors Offering Date 14 July 2016 Maturity Date 14 December 2018 Interest Rate Fixed at 5.20% per year • Name Debenture of Grande Asset Hotels and Property Public Company Limited No. 1/2017 which mature in 2020 Offering Value 261.00 Million Baht Par Value 1,000 Baht Offering Method Via institution and/or high net worth investors Offering Date 26 January 2017 Maturity Date 23 January 2020 Interest Rate Fixed at 5.35% per year • Name Debenture of Grande Asset Hotels and Property Public Company Limited No. 2/2017 which mature in 2019 Offering Value 380.00 Million Baht Par Value 1,000 Baht Offering Method Via institution and/or high net worth investors Offering Date 5 April 2017 Maturity Date 5 October 2019 Interest Rate Fixed at 5.75% per year • Name Debenture of Grande Asset Hotels and Property Public Company Limited No. 3/2017 which mature in 2020
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Offering Value 491.70 Million Baht Par Value 1,000 Baht Offering Method Via institution and/or high net worth investors Offering Date 22 June 2017 Maturity Date 22 June 2020 Interest Rate Fixed at 5.95% per year • Name Debenture of Grande Asset Hotels and Property Public Company Limited No. 4/2017 which mature in 2020 Offering Value 467.90 Million Baht Par Value 1,000 Baht Offering Method Via institution and/or high net worth investors Offering Date 19 October 2017 Maturity Date 19 October 2020 Interest Rate Fixed at 6.25% per year
4.4 Indebtedness to be incurred in the future as at 31 December 2016 The company has some obligation as followed
• Obligation regarding the investment on the land and property value at 636 million Baht. This obligation is for the company investment for property development in the future
• Long term obligation contract
Type Counterparty Rate Start Ending
Hotel management Company and one A) 2004 2019 contract oversea company Hotel management Company and one A) After hotel 20 years from the beginning of contract oversea company completion the hotel operation Hotel management Company and one A) 2013 2032 contract oversea company Hotel management Company and one A) 2013 2032 contract oversea company A) Percentage of revenue and gross profit
14 Enclosure 6 (supporting documents for the consideration of Agenda 9)
In addition, the company has obligation contract for building maintenance, advisory and other service. As of 31 December 2017, these obligation value at 26 million Baht
• Obligation contract on land rental for business operation The company had rent a land for development to hotel and shopping complex which lasted for 30 years and can be extended for another 20 years under the following conditions The company had rent a office for 3 years period started in March 2017 A subsidiary company had rent a land building and equipment for 27 years period where the owner will not extend the rent period after the expiration date A subsidiary company had rent a land building and equipment for hotel operation under the name “Sheraton Hua Hin Resort and Spa” for 3 years period which can be extended for 4 times of 3 years period that started in October 2017 As of 31 December 2017, the group of company had an obligation on minimum payment for these contract value at 2,025 million Baht which belong to the company only at 34 million Baht
• Obligation on guarantee on the revenue contract to a related company value at 88 million Baht Obligation as a guarantee issued by a financial institution under the company and its subsidiary name value at 7 million Baht which belong to the company amount at 4 million Baht. This is normal business for the company and it subsidiary.
5. The Company’s Overview 5.1 Company businesses and Company business’s trend Grande Asset Hotels and Property Public Company Limited (“the Company”) is located at unit 3203-4, 32nd Fl., No. 388, Exchange Tower Sukhumvit Road, Klongtoey, Bangkok. The Company domiciled in Thailand and registered on April 21, 1988 as Sukhumvit Center Company Limited., so as to engage in hotel business. Further, the Company changed the name to P.S. Development Group of Company Limited, and Grande Asset Hotels and Property Public Company Limited, respectively. On July 7, 2003, the Company became a public company and was listed on the Stock Exchange of Thailand on February 10, 2004 as engaged in hotel business, and tourism and leisure service. The Company has put in place a hybrid business strategy (Hybrid) so as to conduct business in real estate development for short and medium term revenue recognition, invest in the hotel business which is investing in property to achieve long-term revenue recognition. The purpose of such strategies is to reduce dependence on one business and to add value to business for long term property. The Company divides business operation and business strategy into 2 categories as follows;
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Real Estate Development Business The company focuses on its investment in a prime location of the business districts and tourist attraction spots with high potential for development whereby the type of projects depends on location, size of land lot, neighborhood and regulations. The current real estate development projects by Grande Asset Hotels and Property Public Company Limited are as follows: The Trendy Condominium This mixed-used type of condominium completed in August 2007, offers various facilities, including swimming pool, Jacuzzi, sauna room, fitness studio, laundry room and parking space for 736 cars. Nicely located in Soi Sukhumvit 13, just 70 meters from Sukhumvit Road, The Trendy condominium is divided into three main parts: Trendy Office (32-storey office building with total 29,850 square meter space; no more units left for sales as of December 31, 2017.), Trendy Residence (18-storey residential condominium comprises 530 units totaling 25,375 square meters; sold out as of the date.) and Trendy Plaza (3-storey plaza building for restaurants and retails with total 10,387 square meter space; two units available for sales with immediate transfer of ownership as of December 31, 2017). Hua Hin Blue Lagoon Resort The resort is divided into two main parts: Blue Lagoon Condominium and Island Villas located adjacent to the Sheraton Hua Hin Resort & Spa. A magnificent swimming lagoon style pool provides the center piece for this stunning resort and the villas allowing customers to discover the heavenly Blue Lagoon experience in a refreshing natural setting. The details of each main parts of the resort are as follows: • Blue Lagoon Condominium: Eighteen buildings of three-storey luxurious condominium are situated on 17 Rai of tropical landscape. Each building features 6 units of 148-150 sqm spacious two- bedroom condominium totaling 108 units. The Blue Lagoon Condominium has been completed and only 3 units available for sales with immediate transfer of ownership as of December 31, 2017. • Island Villa: Located on 20 Rai of beautiful tropical gardens, a two-storey island-style private villa offers 237 or 267 sqm space for 3 luxurious bedrooms totaling 37 Island Villa accommodations. The highlight is to offer our valued customers true Island getaway experience nearby Hua Hin beach. All villas are currently sold out. Hyde Sukhumvit This 40-storey high-end residential complex offers one, two and three-bedroom apartment, junior penthouse and penthouse between 32.03 and 487.63 sqm. The total project value of 454 units is THB 5 billion. Hyde Sukhumvit is located directly on Sukhumvit Soi 13 adjacent to Hyatt Regency Bangkok Sukhumvit which is also our hotel currently under construction.
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After the completed construction, the ownership transfer to condominium unit buyers has started since December, 26 2013. Up to the end of the fourth quarter of 2017, more than 98 percent of the total units have been transferred. The remaining 3 units are large apartments which are duplex and penthouse types. Hyde Sukhumvit 11 Thanks to the great success of Hyde Sukhumvit, the Company has been inspired to develop a new high- rise condominium. As many of our target customers have been calling for small to medium-sized residential units, a land in Soi Sukhumvit 11 was purchased to launch our new Hyde Sukhumvit 11 to meet customers’ needs of living in conveniently located small to medium-sized condominium. The total project value of Hyde Sukhumvit 11 is THB 4 billion. It features a 39-storey residential building with fully equipped facilities and a 9-storey parking building for residential and commercial purposes as well as the rooftop recreation space. The unique luxury residential complex holding 476 units offers a variety of condominium types, including studio bedroom, one-bedroom, two-bedroom, three-bedroom, duplex loft, duplex penthouse and villa penthouse. The area ranges from 27 to 178 sqm, plus 2 units designed for commercial purpose. Since the launch of Hyde Sukhumvit 11 in the first quarter of 2015, the project has been pre-sold approximately 60% of the total units. As of December 31, 2017, the project has been completed and there were 372 units available for sales with immediate transfer of ownership. Hyde Sukhumvit 11 has received overwhelming attention from a great number of foreign clients. According to our sales records, the number of units purchased by foreign clients is almost twice as much the number of units purchased by local clients. Hotel Business The Company focuses on investing, developing or acquisition of existing hotels. All the Company’s hotels are managed under hotel management contracts. The Company has contracts with a few world- known experienced hotel management companies to manage its property. At present, Marriott International is contracted to manage The Westin Grande Sukhumvit and Sheraton Hua Hin Pranburi Villas whereby Hyatt International Corporation is contracted to manage Hyatt Regency Bangkok, Sukhumvit which is now under construction. The details of each hotel are as follows: The Westin Grande Sukhumvit, Bangkok The hotel is located on Sukhumvit Soi 19 near Asoke BTS station and Sukhumvit MRT station currently managed by Marriott International.
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The 25-storey leading five-star hotel features 362 rooms with modern facilities and excellent hotel services such as grand ballroom, conference room, banquet hall, business center, Vareena spa and Westin Work Out Fitness Studio equipped with modern fitness facilities for those who enjoy exercise. Sheraton Hua Hin Pranburi Villas Sheraton Hua Hin Pranburi Villas is a relaxed getaway to immerse in our luxuriously serene escape, nestled within an environment of pure relaxation on a seafront. The 53 private pool villas surrounded by lush tropical gardens and waterways and beautiful beach of Pranburi. Hyatt Regency Bangkok, Sukhumvit The Company's newest hotel, located on Sukhumvit Soi 13 close to Nana BTS station, is currently under construction. It features a total of 273 modern rooms. The Company has appointed Hyatt International Corporation to manage the hotel once it is ready for service. The hotel is expected to begin operating in mid-2018. Sheraton HuaHin Resort & Spa Sheraton Hotel Hua Hin Resort & Spa, a 5-star resort is run under the brand of Sheraton Hotels & Resorts by Marriott International. It locates on the quiet beach of Cha Am; only 200 km away from Bangkok which takes about 2.5 hour-drive. The two-storey building surrounded by a lush garden and greenery altogether 240 rooms including 12 suites in total. However, on 12 October 2017, Honor Business Company Limited; the Company’s wholly owned subsidiary sold the hotel to Grande Hospitality Real Estate Investment Trust (“GAHREIT” or “the Trust”) and lease back to hotel from BBL Asset Management (“Trustee”) for operation. Whereby, Honor Business Company Limited enters into an agreement with Sheraton Overseas Management Corporation (a company under Marriott International, Inc) to manage the hotel. Currently, the company holds 10% in GAHREIT. Industry Outlook
Real Estate Development Business Real estate business for during 2016 – 2017 tends to slow down. In referring to other real estate players’ reports, the number of new project launched is declining; however, the revenue recognition from ownership transferring can still keep going as a result of the launch of old projects over the past 2-3 year. However, there have been a few negative impacts on the industry including an increasing in household debt and a recent decline in agricultural products.
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In general, projects in demand still keeps being developed along good infrastructure area as well as metropolitan areas such as Bang Yai, Bang Na which still have plenty of land plots to develop new projects. Despite projects in CBD and prime location; like Sathorn, Wireless Road and Ploenchit are highly in demand, there are not many freehold land lots available. However, the new CBD over Ratchada and Rama 9 area will potentially be the demanded area whereas the current real estate price is still considerably affordable. The factors that negatively impact project development decisions include a soar in land lot price and customer’s income. These factors automatically force developers to adjust themselves to still exist in the industry by finding a suitable land area and develop new projects into something that will be in line with new lifestyle and increasing efficiency in the use of land, for instance. As such, it is essential for real estate developers to study and understand the needs and behavior of their clients. Hotel Business In 2017, there were 35.4 million tourists in Thailand which had increased from 32.6 million or 8.8% from 2016. This results in an increase in revenue by 11.7% or equivalent to THB 1.82 billion revenue in 2017. The reasons for such growth in the number of tourists are the popularity of Thailand as an overseas tourist destination. Thailand has a good competitive edge over the accommodation price and its currency when comparing to peers in Asia Pacific region
Number of foreign tourists to Thailand 4,000,000 3,500,000 3,000,000
2,500,000
2,000,000 1,500,000 1,000,000
2556 2557 2558 2559 2560
Source: Ministry of Tourism and Sport
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The elimination of illegal tour since 2016 temporarily decreased the number of tourists from China. However, the number of the tourists bounded back in 2017 by 12% increase from 2016. The number of tourists from China increased from 8.76 million in 2016 to 9.81 million in 2017. In general, tourists from China contribute the greatest number of tourists in Thailand, tourists from Malaysia come the second, then ones from South Korea, Laos and Japan, respectively. The number of tourists from ASEAN contributes the greatest proportion; 26%, from Ease Asia contributes the second and from Europe contributes the third. The reasons for such include new flights being operated and the weakening of Thai Baht relative to some other currencies.
Proportion of tourists by nationality in 2017 Oceania Middle East Africa [PERCENTAGE] [PERCENTAGE] [PERCENTAGE] South Asia [PERCENTAGE]
America [PERCENTAGE]
Europe [PERCENTAGE] East and SouthEast Asia 37%
Source: Ministry of Tourism and Sport Another factor that contributes in the growth in number of tourists is the visa exemption and the cheaper fees for visas on arrival for tourists from 21 countries such as China, India, Saudi Arabia and Taiwan. Tourism Authority of Thailand also promotes Thai “Gastronomy Tourism” including the introduction of Michelin Guide Bangkok in late 2017. Despite the bright appearance in hotel business due to the growth in number of tourists, the competitive force among peers in hotel business still increase. Each of hotel owners and operators adopts various strategies ranging from the extension of their business in both Bangkok and overseas for big operators and accommodating budget but unique experience for mid to small operators. However, to increase occupancy rate and room rate are the challenges to the hotel operators.
20 Enclosure 6 (supporting documents for the consideration of Agenda 9)
However, the Government is attempting to support hotel operators in various ways such as supporting private sector through partnership in expanding and renovating airports as well as tax reduction on seminar events, vacation and MICE in 55 provinces throughout 2018. Despite the number of tourists is likely to increase in 2018 and luxury or high-end business hotels are still in demand, the mid to small hotel operators may still face higher competition due to more alternative accommodations available such as service apartment, hostel or condominium via Airbnb. As such, the competitive strength may shift to convenience, safety and service excellence. Financial Snapshot and MD&A 5.1.1 Financial position and Financial performance
Statements of Financial Position (consolidated) As of 31 December (Unit: THB million) 2015 2016 2017 Assets Current Assets Cash and cash equivalent 370.90 473.69 1,411.52 Trade and other receivables 53.55 43.90 83.43 Receivable from Revenue Department 37.55 - - Short-term loan to subsidiary and interest receivable - - 452.31 Inventories 7.51 6.66 6.94 Prepaid expense for real estate development - - 30.00 Cost of real estate development 1,336.39 2,017.38 2,269.34 Other current assets 129.81 148.27 74.24 Total Current Assets 1,935.71 2,689.90 4,327.78 Non-Current Assets Pledged and restricted withdrawal bank deposits 9.29 8.83 7.19 Deposits in other companies share purchase - - 144.38 Investments in JV - - 475.14 Securities - - 175.50 Advance for acquisition of land - 422.00 - Land held for development - 86.23 117.12 Deposits for hotel construction 60.07 177.32 85.29 Investment properties 37.90 31.31 24.71 Property, plant and equipment 3,411.03 3,893.81 3,487.10 Computer software 27.18 21.48 15.11 Leasehold rights 336.89 314.10 291.31
21 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Statements of Financial Position (consolidated) As of 31 December (Unit: THB million) 2015 2016 2017 Compensation guarantee 34.00 19.00 - Lease guarantee - - 88.00 Deferred tax assets 20.32 14.89 20.72 Other non-current assets 11.09 10.48 25.45 Total non-current assets 3,947.77 4,999.45 4,957.02 Total assets 5,883.48 7,689.35 9,284.80 Liabilities and shareholders’ equity
Current liabilities Trade and other payables 253.60 330.10 444.27 Bills of exchange payable 1,148.99 932.67 249.45 Short-term loans from related parties and interest payable 172.00 40.92 149.62 Current portion of debentures - - 449.72
Current portion of long-term loans from financial institutions 30.88 14.80 753.78 Deposits received 279.21 462.93 393.25 Income tax payable 0.29 12.18 60.60 Other current assets 76.15 49.40 84.65 Total current assets 1,961.12 1,843.00 2,585.34 Non-Current Liabilities Debentures – net off with the current portion - 1,345.88 2,493.18 Long-term loans from financial institutions – net off with current portion 897.77 1,479.02 468.84 Unearned lease right 52.50 42.24 31.41 Provision for long-term employment benefits 51.58 54.36 62.79 Deferred tax liabilities 17.02 16.00 16.76 Other non-current liabilities 7.23 6.69 3.27 Total non-current liabilities 1,026.10 2,944.19 3,076.25 Total liabilities 2,987.22 4,787.19 5,661.59 Shareholders’ equity Issued and paid-up capital 2,889.04 2,889.04 2,889.04 Retained earnings – appropriate 28.08 34.24 44.93 Retained earnings - unappropriated (20.86) (21.12) 689.24 Total shareholders’ equity 2,896.26 2,902.16 3,623.21 Total liabilities and shareholders’ equity 5,883.48 7,689.35 9,284.80
22 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Statements of Comprehensive Income (consolidated) For year end (Unit: THB million) 2015 2016 2017 Revenue
Revenue from hotel operations 1,052.40 1,079.22 1,093.20 Revenue from sales of real estate 286.51 320.28 1,195.64 Other income Gain from asset disposal to GAHREIT - - 573.44 Gain from the loss in control of subsidiaries - - 8.75 Rental income 22.29 17.85 16.16 Interest Income 1.85 3.26 14.27 Others 23.02 33.24 34.34 Total revenue 1,386.07 1,453.85 2,935.80 Expenses Cost of hotel operations 390.12 388.83 392.05 Cost of sales of real estate 137.72 100.82 692.66 Selling expenses 186.32 127.20 214.32 Administrative expenses 476.75 472.95 507.62 Depreciation and amortization 232.34 251.33 230.02 Total expenses 1,423.25 1,341.13 2,036.67 Profit (loss) before finance cost and income tax expenses (37.18) 112.72 899.13 Finance cost (80.44) (79.72) (84.10) Profit (loss) before income tax expenses (117.62) 33.00 815.03 Income tax expenses (2.86) (27.10) (91.98) Net Profit (loss) (120.48) 5.90 723.05
Cash Flow Statements For year end (Unit: THB million) 2015 2016 2017 Cash flows from operating activities Profit (loss) before tax (117.62) 33.00 815.03 Adjustments to reconcile profit (loss) before tax to net cash provided by (paid from) operating activities: Reversal of cost of sales of real estate - (6.59) - Depreciation and amortization 232.34 251.33 230.03
23 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Cash Flow Statements For year end (Unit: THB million) 2015 2016 2017 Increase in allowance for doubtful accounts (reversal) (0.02) 0.29 (0.34) Trade receivables written off - 0.27 4.09 Receivable from the Revenue Department written off - 7.52 - Amortization of construction deposits - - 2.84 Withholding tax deducted at source written off 0.33 - - Amortization of unearned lease rights (19.52) (17.99) (14.47) Amortization of deferred bills of exchange and debenture issuing costs - 1.24 1.38 Amortization of fee on loan from financial institutions - - 8.91 Gain on asset disposal to GAHREIT - - (573.44) Gain on disposals of equipment (1.06) (1.34) (0.58) Loss due to subsidiary’s restructuring - - 13.60 Gain from the loss in control of subsidiaries - - (8.75) Reversal of impairment of leasehold right (1.87) - - Warranty provision for real estate project (reversal) 2.27 (24.91) 7.93 Provision for long-term employment benefit 6.34 8.69 10.35 Interest income (1.85) (3.26) (14.27) Interest expenses 78.29 77.67 73.84 Profit from operating activities before changes in operating assets and liabilities 177.63 325.92 556.15 Operating assets (increase) decrease: Trade and other receivables (1.56) 9.08 (43.49) Inventories (0.69) 0.85 (0.28) Cost of real estate development 3.47 (588.51) 660.39 Advance for land acquisition - - (343.67) Other current assets (77.50) (38.00) (17.39) Compensation guarantee 12.00 15.00 19.00 Lease deposit - - (88.00) Other non-current assets (6.61) 0.61 (14.97) Operating liabilities increase (decrease): Trade and other payables 44.93 66.62 99.45 Deposit received 191.14 183.71 (69.68) Other current liabilities (27.96) 12.01 31.43 Cash flows from (used in) operating activities 314.85 (12.71) 788.94 Cash paid for long-term employee benefits (3.00) (5.90) (4.74) Cash paid for corporate income tax (28.11) (11.81) (49.89) Income tax refund - 30.03 4.67
24 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Cash Flow Statements For year end (Unit: THB million) 2015 2016 2017 Net cash flows from (used in) operating activities 283.74 (0.39) 738.98 Cash flows from investing activities Decrease in pledged and restricted withdrawal bank deposits 31.04 0.46 1.64 Increase in loan from JV - - (452.31) Increase in investment in JV - - (480.00) Increase in investment in securities - - (175.50) Increase in advance for acquisition of land - (422.00) - Increase in land held for development - (86.23) - Increase in deposit for other companies’ share purchase - - (144.38) Increase in deposit for hotel construction (56.08) (117.26) (38.81) Acquisition of building and equipment (292.58) (663.71) (607.30) Acquisition of computer software (2.04) (0.75) (0.91) Interest income 1.85 3.27 3.72 Proceeds from sales of asset to GAHREIT - - 1,637.35 Proceeds from sale of equipment 2.06 1.60 0.58 Net cash flows used in investing activities (315.75) (1,284.62) (255.92) Cash flows from financing activities Cash receipt from bills of exchange payable 1,325.57 1,770.72 788.80 Cash receipt from short-term loans from related party - - 100.00 Cash receipt from debentures - 1,343.79 1,593.53 Repayment of short-term loan from financial institution (200.00) - - Cash receipt from long-term loans from financial institutions 328.62 645.00 2,072.45 Repayments of bills of exchange payable (200.00) (2,030.00) (1,488.00) Repayment of short-term loan from related party - (117.80) - Repayment of short-term loan from unrelated parties (500.00) - - Repayment of liabilities under finance lease agreements (5.58) (5.62) (4.43) Repayment of long-term loans from financial institutions (453.53) (83.35) (2,355.04) Dividend paid (15.30) - - Interest expenses (114.95) (134.94) (252.54) Net cash flows from financing activities 164.83 1,387.80 454.77 Net increase in cash and cash equivalents 132.82 102.79 937.83 Cash and cash equivalents at the beginning of year 238.08 370.90 473.69 Cash and cash equivalents at the end of year 370.90 473.69 1,411.52
25 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Operation Result The operation results of the Company and its subsidiaries (the “Group Company” or the “Group”) from 2015 to 2017 are summarized and discussed in this part. For 2015 Operation results, the Group Company reported loss of THB 120 million which is lower than 2014 that generated profit of THB 722 million. The Company itself reported profit of THB 6 million, dropped from THB 760 million in 2014. This was due to a decline in gross profit in real estate business because there were not many units in Hyde Sukhumvit left for transferring in 2015 as 90% of units had been transferred since 2014; which was doing well beyond expectation in 2014.
For 2016 Operation results, the Group Company reported profit of THB 6 million which improved from loss of THB 120 million in 2015. The Company itself reported profit of THB 123 million, increased from THB 117 million in 2015. The improvement in profit from the previous year was due to the increase in gross profit from real estate business because of condominium units; Hyde Sukhumvit being transferred and the increase in gross profit from the hotel business due to higher occupancy rate.
For 2017 Operation results, the Group Company reported profit of THB 723 million which improved from profit of THB 717 million in 2016. The Company itself reported profit of THB 214 million which improved from the profit of THB 91 million in 2016. The improvement in profit from the previous year was due to the increase in gross profit from real estate business as a result of condominium units; Hyde Sukhumvit 11 being transferred and the increase in gross profit from the hotel business due to average room rate. Also, there was a gain realized as a result of asset disposal; Sheraton Hua Hin Resort & Spa to GAHREIT.
Revenue
Consolidated Financial Statements 2015 2016 2017 Million % Million % Million % Revenue from hotel operation 1,052.40 75.93 1,079.22 74.23 1,093.20 37.24 Revenue from real estate business 286.51 20.67 320.28 22.03 1,195.64 40.73 Gain from asset disposal to GAHREIT - - - - 573.44 19.53 Gain from loss of control in subsidiary - - - - 8.75 0.30 Rental income 22.29 1.61 17.85 1.23 16.16 0.55 Other revenue* 24.87 1.79 36.5 2.51 48.61 1.65 Total revenue 1,386.07 100.00 1,453.85 100.00 2,935.80 100.00 * Other revenue includes interest income, spa revenue, income from deposit confiscate, exchange gain.
26 Enclosure 6 (supporting documents for the consideration of Agenda 9)
In 2015, the total revenue of the Group was THB 1,386 million, lower from 2014 by THB 3,542 million or 72% drop from 2014. The total revenue at the company itself was THB 1,013 million, lower from 2014 by THB 3,611 million or 78% drop from 2014. In 2016, the total revenue of the Group was THB 1,454 million, higher than 2015 by THB 68 million or 5% increase from 2015. The total revenue at the company itself was THB 1,076 million, higher than 2015 by THB 63 million or 6% increase from 2015. In 2017, the total revenue of the Group was THB 2,936 million, higher than 2016 by THB 1,482 million or 102% increase from 2016. The total revenue at the company itself was THB 2,006 million, higher than 2016 by Baht 931 million or 87% increase from 2016. The revenue breakdown by each business line and their details are discussed as follows:
Revenue from Hotel Business
Hotel revenue of the Group in 2015 was THB 1,052 million, or accounted for 76% of total revenues, higher than 2014 by THB 227 million or 28% increased. The Westin Grande Sukhumvit Hotel's total revenue was THB 577 million, higher than 2014 by THB 143 million or 33 %. Sheraton Hua Hin Resort & Spa and Sheraton Hua Hin Pranburi Villa total revenue was THB 475 million, went up by THB 84 million or 21% from 2014. This better revenue was due to higher number of tourists and businessmen travelled to Thailand in 2015, leading to higher occupancy rate and average room rate.
Revenues from hotel operations of the Group in 2016 was THB 1,079 million or accounted for 74% of total revenues, increased by THB 27 million or 3% from 2015. The revenue of the Westin Grande Sukhumvit Hotel was THB 628 million, increased by THB 51 million or 9% from 2015. Sheraton Hua Hin Resort & Spa and Sheraton Hua Hin Pranburi Villa total revenue was THB 451 million, decreased by THB 24 million or 5% from 2015. The revenue increase was due to the higher number of tourists and businessmen visiting Thailand in 2016 resulting in an improvement in occupancy rate. Despite the higher number of tourist, the average room rate declined due to more competitors and the bombs in HuaHin downtown. Despite the lower number of foreign visitors due to the loss of our beloved King Rama IX as well as the increase in the number of competitors which puts a downward pressure on price, total revenue in 2017 was THB 1,093 million or 37% of total revenue, increased by THB 14 million or 1%. The revenue from Westin Grande Sukhumvit Hotel was THB 647 million, increased by THB 19 million or 3% due to better average room rate. However, Sheraton Hua Hin Resort & Spa and Sheraton Hua Hin Pranburi Villa revenue was THB 447 million or 41% of total revenue, dropped by THB 4 million or 1% from 2016 due to the lower in occupancy rate and average room rate which declined by 2% - 3% from 2016.
27 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Revenue from Real Estate Business
The Company generated revenue from real estate business of THB 287 million or 21% of the total revenue in 2015, decreased by THB 3,757 million or 93% from 2014. This is due to a decease in the number of units sale and ownership transfer of Hyde Sukhumvit as most of the ownership transfer was done in 2014. In general, revenue recognition occurs when the ownership of houses and condominium has been transferred. Details of ownership transfer in 2015 are as follows:
Ownership Transfer 2015 Transfer value 2015 (THB Remaining Project (rooms) million) (rooms) Hyde Sukhumvit 19 287 15 Blue Lagoon Hua Hin - - 6 The Trendy Condominium - - 2 Total 19 287 23
The revenue from the real estate business was THB 320 million or 22% of the total revenue in 2016 which increased by THB 34 million or 12% from 2015. Details of ownership transfer in 2016 are as follows:
Ownership Transfer 2016 Transfer value 2016 (THB Remaining Project (rooms) million) (rooms) Hyde Sukhumvit 5 320 10 Blue Lagoon Hua Hin - - 6 The Trendy Condominium - - 2 Total 5 320 18
The revenue from the real estate business was THB 1,196 million or 41% of the total revenue in 2017 which increased by THB 875 million or 273% from 2016. Details of ownership transfer in 2016 are as follows:
Ownership Transfer 2017 Transfer value 2017 (THB Remaining Project (rooms) million) (rooms) Hyde Sukhumvit 11 106 893 372 Hyde Sukhumvit 7 280 3 Blue Lagoon Hua Hin 3 23 3 The Trendy Condominium - - 2 Total 116 1,196 380
28 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Gain on asset disposal to GAHREIT
The gain from the sale of Sheraton Hua Hin Resort & Spa to GAHREIT in 2017 was THB 573 million baht or 20% of the total revenue.
Other revenue
Other income of the Group was reported at THB 47 million, or 3% of total revenue in 2015. Other income included rental income, spa revenue and gain on asset disposal. However, other revenue in 2015 declined by THB 12 million or 20% from 2014 due to a decline in number of deposit confiscated from the customers.
Other income of the Group was reported at THB 54 million in 2016, or 4% of total revenue. Other income included rental income, spa revenue, gain on asset disposal and deposit confiscated. Other revenue in this year increased by THB 7 million or 15% from 2015 due to an increase in deposit confiscated.
Other income of the Group was reported at THB 65 million in 2017, or 2% of total revenue. Other income included interest income, rental income, spa revenue, gain on asset disposal and deposit confiscated. Other income in this year increased by THB 11 million or 20% due to an increase in interest income.
Direct Costs, SG&A and other expenses The Group Company’s total expenses in 2015 was THB 1,423 million, decreased by THB 2,539 million or 64% from 2014. The total expenses of the Company level was THB 919 million, decreased from 2014 by THB 2,569 million or 74%.
The Group Company’s total expenses in 2016 was THB 1,341 million, decreased by THB 82 million or 6% from 2015. The total expenses of the Company level was THB 842 million, decreased from 2015 by THB 77 million or 8%.
The Group Company’s total expenses in 2017 was THB 2,036 million, increased by THB 695 million or 52% from 2016. The total expenses of the Company level was THB 1,622 million, increased from 2016 by THB 780 million or 93%.
The details of such changes in the expenses are as follows:
29 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Direct costs and Gross profit
Consolidated Financial Statements 2015 2016 2017 THB mm % THB mm % THB mm % Hotel business direct costs 390.12 73.91 388.83 79.41 392.05 36.14 Real estate direct costs 137.72 26.09 100.82 20.59 692.66 63.86 Total 527.84 100.00 489.65 100.00 1,084.71 100.00
Hotel business direct costs
In 2015, the direct costs of the hotel business increased from 2014 by THB 53 million or 16%. The direct costs from the Company itself increases from 2014 by THB 32 Million or 18% as it varied by the increase in hotel revenue.
In 2016, the direct costs of the hotel business decreased from 2015 by THB 1 million. The direct costs from the Company itself increased from 2015 by THB 5 Million or 3% as it varied by the increase in hotel revenue.
In 2017, the direct costs of the hotel business was THB 392 million, increased by THB 3 million or 1% from 2016. The changes in the direct costs stemmed from the subsidiary’s hotel direct costs which increased by THB 4 million or 2%. These hotels included Sheraton HuaHin Pranburi Villa (THB 3 million) and Sheraton HuaHin Resort & Spa (THB 1 million) The increase in direct costs was due to an increase in the number of staff which led to an increase in employee wages and salaries and other welfares. Despite an increase in hotel revenue for The Westin Grande Sukhumvit due to an improvement in occupancy rate, the direct cost still decreased by THB 1 million indicating an effective cost management.
Real estate business direct costs
In 2015, the direct costs of the real estate business decreased from 2014 by THB 2,465 million due to the lower number in ownership transfers in Hyde Sukhumvit.
In 2016, the direct costs of the real estate business decreased from 2015 by THB 37 million due to the lower number in ownership transfers in Hyde Sukhumvit.
In 2017, the direct costs of the real estate business increased from 2016 by THB 592 million due to the transfer of ownership in units at Hyde Sukhumvit 11 and Hua Hin Blue Lagoon.
30 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Gross Profit
The breakdown of gross profit and gross profit margins for each business are summarized as follows:
Consolidated Financial Statements
2015 2016 2017 Hotel Business Gross Profit (THB mm) 662.28 690.39 701.17 Gross profit margin 63.93 63.97 64.14 Real estate business Gross Profit (THB mm) 148.79 219.46 502.98 Gross profit margin 51.93 68.52 42.07
Selling Expenses
In 2015, the Group’s total selling expenses were THB 186 million, decreased by THB 148 million or 44% from 2014. This is due to a decrease in the number of ownership transfers and promotion relating to Hyde Sukhumvit. However, the Company launched Hyde Sukhumvit 11 in March 2015 which led to an increase in agency costs, advertising costs and event and marketing expenses.
In 2016, the Group’s total selling expenses were THB 127 million, decreased by THB 59 million or 32% from 2015 as most of the selling expenses relating the launch of Hyde Sukhumvit 11 occurred in 2015 as explained above.
In 2017, the Group’s total selling expenses were THB 214 million, increased from 2016 by THB 87 million or 68% resulting from an increase in costs associated with ownership transfer, promotion, event and marketing expenses of Hyde Sukhumvit 13 and Hyde Sukhumvit 11. Moreover, other expenses such as agency cost, fee and tax relating to the ownership transfer also occurred as a result of ownership transfer.
Administrative Expenses
In 2015, the Group allocated the rental expenses according to the Accounting Standard; however, the administrative cost of THB 477 million in this year still decreased from 2014 by THB 5 million or 1%. This is because the Company had had expenses relating to the launch of Hyde Sukhumvit, provision to loss on court case, sales tax penalty for Project Crowne Plaza Sukhumvit as well as hotel renovation expenses and the launch of Sheraton HuaHin Pranburi Villa.
31 Enclosure 6 (supporting documents for the consideration of Agenda 9)
In 2016, the Group’s administrative expenses was THB 473 million which decreased by THB 4 million or 1% from 2015 due to the adoption of straight line rent amortization throughout the rental agreement according to the Accounting Standard.
In 2017, the Group’s administrative expenses was THB 508 million, increased by THB 35 million or 7% due to an increase in the number of staff, deposit amortization and rental expense paid to GAHREIT.
Depreciation and Amortization
In 2015, the depreciation and amortization expenses of the Group Company was THB 232 million, increased by THB 28 million or 14% from 2014 due to the opening of new banquet room at Sheraton HuaHin Resort & Spa in November 2014.
In 2016, the depreciation and amortization expenses of the Group Company was THB 251 million, increased by THB 19 million or 8% from 2015 due to the purchase of new machines and equipment to replace the old ones which had been fully depreciated. Moreover, Sheraton HuaHin Pranburi Villa had opened new restaurant, swimming pool and multifunctional room which led to higher depreciation expense in 2016.
In 2017, the depreciation and amortization expenses of the Group Company was THB 230 million, decreased by THB 21 million or 8% from 2016 due to the disposal of Sheraton HuaHin Resort & Spa to GAREIT in October 2017.
Finance Cost
Despite an increase in loans in 2015, the finance cost decreased by THB 89 million or 53% from 2014. The loans were for new projection construction; as such, the finance cost on these loans in 2015 was classified as part of project cost and was capitalized.
Like in 2015; despite an increase in loans in 2016, the finance cost decreased by THB 1 million from 2015. The loans were for new projection construction; as such, the finance cost on these loans in 2016 was classified as part of project cost and was capitalized.
In 2017, the finance cost of the Group Company was THB 84 million, increased by THB 4 million or 5% because the company repaid the loan earlier than what had been scheduled. As such, the prepaid fee expense of approximately THB 9 million therefore immediately was adjusted to become an expense; as part of finance cost in the year. Moreover, overall finance cost also increased due to a loan for one of its subsidiaries’ project.
32 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Income Tax
In 2015, the income tax expense decreased by THB 191 million from 2014 as a result of the lower EBT. The decrease in such tax expense amount stemmed from the decrease in income tax expense of THB 68 million and the deferred tax of THB 123 million.
In 2016, the income tax expense increased by THB 24 million from 2015 as a result of the higher EBT. The increase in such tax expense amount stemmed from the increase in income tax expense of THB 21 million and the deferred tax of THB 3 million.
In 2017, the income tax expense increased by THB 65 million from 2016 as a result of the higher EBT. The increase in such tax expense amount stemmed from the increase in income tax expense of THB 74 million but the deferred tax decreased by THB 9 million.
EBITDA, net profit and net profit margin
From the revenue and expenses information, EBITDA, net profit and net profit margin can be summarized as follows:
Consolidated Financial Statement (Unit: THB mm) 2015 2016 2017 EBITDA 195.16 364.05 1,129.16 Net profit (120.48) 5.90 723.05 Shareholders’ equity (120.48) 5.90 723.05 NCI - - - Net profit margin (%) (8.69) 0.41 24.63
In 2015, the Group Company generated EBITDA of THB 195 million or 9% of total revenue. However, this year EBITDA decreased by THB 975 million from 2014 due to the lower gross profit in real estate business; Hyde Sukhumvit.
In 2016, the Group Company generated EBITDA of THB 364 million or 0.4% of total revenue which increased by THB 169 million from 2015. This is due to the higher gross profit margin in real estate business as a result of the ownership transfer of units in high demand spots; as such, were sold at higher price.
In 2017, the Group Company generated EBITDA of THB 1,129 million or 25% of total revenue which increased by THB 765 million from 2016. This is due to the higher gross profit margin in real estate business as a result of the ownership transfer of units in Hyde Sukhumvit 11 and HuaHin Blue Lagoon. Moreover, the gross
33 Enclosure 6 (supporting documents for the consideration of Agenda 9) profit margin in hotel business also improved due to better average room rate. Finally, the Company realized gain on asset (Sheraton HuaHin Resort & Spa) disposal to GAHREIT with the amount of THB 573 million.
Return on Equity
Consolidated Financial Statement (Unit: THB mm) 2015 2016 2017 Net profit (120.48) 5.90 723.05 Issued and Paid-up capital 2,889.04 2,889.04 2,889.04 Shareholders’ equity 2,896.26 2,902.16 3,623.21 ROE (%) (4.06) 0.20 19.96
In 2015, the Group Company reported a net loss of THB 120 million which decline from the net profit in 2014 by THB 722 million. This is because of the lower gross profit margin in real estate business as the number of ownership transfer was lower than the previous year; as mentioned earlier, the majority of units was transferred and the revenue was already recognized in 2014.
In 2016, the Group Company reported a net profit of THB 6 million, increased from the previous year by HB 126 million as a result of an improvement in gross profit in real estate business due to the ownership transfer of Hyde Sukhumvit as well as a decrease in overall expenses as majority of expenses such as advertising, event and marketing already occurred in 2015 when the project was launched. The gross profit from hotel business also increased due to the higher occupancy rate.
In 2017, the Group Company reported a net profit of THB 723 million, increased from 2016 by THB 717 million as a result of an increase in gross profit in real estate business due to the transfer of ownership in Hyde Sukhumvit 11 and HuaHin Blue Lagoon. Moreover, the gross profit margin from hotel business also improved due to better average room rate as well as the gain on asset disposal to GAHREIT and a decrease in depreciation and amortization expenses as a result of asset disposal.
Financial Position
The table below presents the financial position of the Group Company.
Consolidated (Unit: THB mm) Assets Liabilities Shareholders’ equity As of 31 December 2015 5,883.48 2,987.22 2,896.26 As of 31 December 2016 7,689.35 4,787.19 2,902.16 As of 31 December 2017 9,284.80 5,661.60 3,623.20
34 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Assets The Group Company reported the total assets of THB 5,883 million as of 2015 year end, increased by THB 355 million from 2014 year end due to new project development and additional construction; such as restaurant, swimming pool and multifunctional room of its existing hotel. The Group’s assets comprises of PPE of THB 3,411 million or 58%, Capitalized costs of THB 1,336 million or 23%, cash and cash equivalent of THB 371 million or 6% and leasehold rights of THB 337 million or 6%. The Group Company reported the total assets of THB 7,689 million as of 2016 year end, increased by THB 1,806 million from 2015 year end due to new project development, deposit on land acquisition and new hotel construction capitalized cost. The Group’s assets comprises of PPE of THB 3,894 million or 51%, Capitalized costs of THB 2,017 million or 26%, cash and cash equivalent of THB 474 million or 6%, deposit on land acquisition of THB 422 million or 5% and leasehold rights of THB 314 million or 4%. The Group Company reported the total assets of THB 9,285 million as of 2017 year end, increased by THB 1,596 million from 2016 year end due to new project development, investment in JV which resulted in an increase in loan to JV and interest receivable, investment in GAHREIT units, deposit on share acquisition and a construction-in-progress for a new hotel. However, one of the subsidiaries reported lower total assets due to the disposal of Sheraton HuaHin Resort & Spa to GAHREIT. The Group’s assets comprises of PPE of THB 3,487 million or 38%, Capitalized costs of THB 2,269 million or 24%, cash and cash equivalent of THB 1,412 million or 15%, investment in JV of THB 475 million or 5%, loan to JV and interest receivable of THB 452 or 5% and leasehold rights of THB 291 million or 3%.
Property, Plant and Equipment (PPE)
The Group reported the PPE of THB 3,411 million for 2015 year end, increased by THB 111 million from 2014 due to new project development and additional construction; such as restaurant, swimming pool and multifunctional room of its existing hotel.
The Group reported the PPE of THB 3,894 million for 2016 year end, increased by THB 483 million from 2015 due to investments in 2 new hotels and renovations.
The Group reported the PPE of THB 3,487 million for 2017 year end, decreased by THB 407 million from 2016 due to the disposal of Sheraton HuaHin Resort & Spa to GAHREIT. However, the total assets reported for the Company itself increased by THB 700 million due to the construction-in-progress of Hyatt Regency Hotel of THB 705 million and structuring work in Rayong province which led to higher land value.
35 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Capitalized Cost of real estate development The costs of real estate development during the construction phrase is generally capitalized and reported in the balance sheet; however, these costs will be allocated as direct costs and reported in the income statement once the ownership of such asset is transferred to the customer (buyer). In 2015, the capitalized cost of real estate development was THB 1,336 million, increased by THB 43 million from 2014. This was due to the construction of Hyde Sukhumvit 11 of THB 184 million and an ownership transfer of 19 units for Hyde Sukhumvit; equivalent to THB 138 million. As of the end of 2015, there were 15 units not yet sold or not yet transferred. In 2016, the capitalized cost of real estate development was THB 2,017 million, increased by THB 681 million from 2015. This was due to the construction of Hyde Sukhumvit 11 of THB 383 million, investment in new real estate developments of THB 401 million, an ownership transfer of 5 units for Hyde Sukhumvit; equivalent to THB 101 million. As of the end of 2016, there were 10 units not yet sold or not yet transferred. In 2017, the capitalized cost of real estate development was THB 2,269 million, increased by THB 252 million from 2016. This was due to the construction of Hyde Sukhumvit 11 of THB 993 million, an ownership transfer of 7 units for Hyde Sukhumvit; equivalent to THB 280 million, 106 units for Hyde Sukhumvit 11; equivalent to THB 893 million, 3 units for HuaHin Blue Lagoon; equivalent to THB 23 million. As of the end of 2017, there were 3 units left for Hyde Sukhumvit, 372 units left for Hyde Sukhumvit 11, 3 units left for HuaHin Blue Lagoon and 2 units left for The Trendy Condominium not yet sold or not yet transferred. Cash and Cash equivalent The Group Company reported cash and cash equivalent of THB 371 million for 2015 year end, increased by THB 133 million from 2014. The Group Company reported cash and cash equivalent of THB 474 million for 2016 year end, increased by THB 103 million from 2015. The Group Company reported cash and cash equivalent of THB 1,412 million for 2017 year end, increased by THB 938 million from 2016. Investment in JV As of 31 December 2017, the Group Company had an investment in JV; Grande Star Co Ltd of THB 475 million or 5% of total assets. The JV consists of Grande Asset Hotels and Property PCL, Property Perfect PCL and Sumitomo Forestry Singapore Ltd for the purpose of developing condominium for sales.
36 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Loan to JV Loan to JV and interest receivable from JV was THB 452 million for 2017 year end; equivalent to 6% of total assets. The loan has no collateral and is due upon being asked by the lender. Leasehold Rights The Group Company reported the leasehold rights of THB 337 million for 2015 year end, decreased by THB 21 million from 2014 due to the amortization of leasehold rights in the investment in Owendelle Co Ltd according to the rental contract. The Group Company reported the leasehold rights of THB 314 million for 2016 year end, decreased by THB 23 million from 2015 due to the amortization of leasehold rights in the investment in Owendelle Co Ltd according to the rental contract. The Group Company reported the leasehold rights of THB 291 million for 2017 year end, decreased by THB 23 million from 2016 due to the amortization of leasehold rights in the investment in Owendelle Co Ltd according to the rental contract. Deposit on share acquisition In November 2017, the Company entered into an agreement to purchase shares of Royal Orchid (Thailand) PCL from Starwood Hotels (Thailand) Co., Ltd. The Company then paid 10% deposit, or approximately THB 144 million, which is equivalent to 2% of total assets. Land bank Land bank for future real estate development projects for 2016 year end was reported at THB 86 million or 1% of total assets. Land bank for future real estate development projects for 2017 year end was reported at THB 117 million, increased by THB 31 million from 2016. Guarantee for lease agreement
One of the subsidiaries and the Company entered into a rental guarantee agreement with the trustee of GAHREIT, whereby the Company agreed to bind itself as a guarantor of the rental income GAHREIT is to receive from tenant, and as a co-debtor of the tenant. The amount equals THB 88 million for 2017 year end or equivalent to 1% of total assets.
37 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Deposits for hotel construction The deposits for hotel construction reported at THB 177 million for 2016 year end, equivalent to 2% of total assets. The deposits for hotel construction reported at THB 85 million or 1% of total assets for 2017 year end, decreased by THB 92 million from 2016 due to the progress on hotel construction which is expected to finish in mid 2018. Trade receivable For real estate business: The revenue from sales is recognized once the ownership of units have been transferred to customers (buyers); therefore, the Company treats down payments or advance installments as deposits under liabilities. However, the ownership transfer to customers who have not settled all the payments will be treated as trade receivables. For 2014 to 2017 year end, the Group Company did not have any trade receivables relating to real estate business at all. For hotel business: The Group Company reported trade receivable relating to hotel business for 2015 year end of THB 49 million or 1% of total assets, increased by THB 2 million from 2014. The Company also had a provision for doubtful debt of THB 2 million. The Group Company reported trade receivable relating to hotel business for 2016 year end of THB 38 million or 0.5% of total assets, decreased by THB 11 million from 2015. The Company also had a provision for doubtful debt of THB 2 million. The Group Company reported trade receivable relating to hotel business for 2017 year end of THB 49 million or 1% of total assets, increased by THB 11 million from 2016. The Company also had a provision for doubtful debt of THB 2 million. Other receivables The Group Company reported other receivables for 2015 year end of THB 7 million, or 0.1% of total assets. The amount had been unchanged from 2014. The Group Company reported other receivables for 2016 year end of THB 8 million, or 0.1% of total assets. Other receivables had increased from 2015 by THB 1 million.
38 Enclosure 6 (supporting documents for the consideration of Agenda 9)
The Group Company reported other receivables for 2017 year end of THB 36 million or 0.4% of total assets. Other receivables had increased from 2016 by THB 28 million. Advance for acquisition of land for real estate development Advance for acquisition of land for real estate development as of 2017 year end equaled THB 30 million or 0.3% of total assets. Investment properties The investment properties of the Group Company were reported at THB 38 million or for 2015 year end, or 1% of total assets. The reported amount had decreased by THB 6 million from 2014. The investment properties of the Group Company were reported at THB 31 million or for 2016 year end, or 0.4% of total assets. The reported amount had decreased by THB 6 million from 2015. The investment properties of the Group Company were reported at THB 25 million or for 2017 year end, or 0.3% of total assets. The reported amount had decreased by THB 7 million from 2016. Advance acquisition of land Advance acquisition of land was reported at THB 422 million for 2016 year end or 5% of total assets. The purpose of such land acquisition is for future real estate development. As of 2017 year end, the Group Company did not have any advance acquisition of land balance. Pledged and restricted withdrawal bank deposits Deposits received and down payments from customers from the sales of real estate units which are still under construction will be deposited at pledged and restricted bank account where the Company’s principal on loans and interest will be repaid out of this bank account. The Group Company reported Pledged and restricted withdrawal bank deposits of THB 9 million or 0.1% of total assets for 2015 year end which decreased by THB 31 million from 2014. This is due to the withdrawal for operational purposes after the Company had been repaying the lender since 2014. The Group Company reported Pledged and restricted withdrawal bank deposits of THB 9 million or 0.1% of total assets for 2016 year end which decreased by THB 0.5 million from 2015. The Group Company reported Pledged and restricted withdrawal bank deposits of THB 7 million or 0.1% of total assets for 2017 year end.
39 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Liabilities The Group Company reported total liabilities for 2015 year end of THB 2,987 million, increased by THB 491 million from 2014 due to bills of exchange and deposits received from the sales of real estate units. The Group Company reported total liabilities for 2016 year end of THB 4,787 million, increased by THB 1,800 million from 2015 due to the increase in 1) the issuance of debentures of THB 1,346 million, 2) short-term loans from institutions of THB 565 million and 3) deposit received from the sales of real estate units of THB 184 million. The Group Company reported total liabilities for 2017 year end of THB 5,662 million, increased by THB 875 million from 2016 due to the issuance of debentures of THB 1,597 million; however, bills of exchange outstanding declined by THB 683 million. The Group Company’s liabilities from 2015 – 2017 can be broken down with details in the table below
Consolidated Financial Statements As of: Unit: THB mm % of total % of total % of total 31 Dec 2015 31 Dec 2016 31 Dec 2017 liabilities liabilities liabilities Trade and other payables 253.60 8.49 330.10 6.90 444.27 7.85 Bills of exchange 1,148.99 38.46 932.67 19.48 249.45 4.41 Short-term loans from related parties 172.00 5.76 40.92 0.85 149.62 2.64 Deposits received 279.21 9.35 462.93 9.67 393.25 6.94 Income tax payable 0.29 0.01 12.18 0.25 60.60 1.07 Other current liabilities 76.15 2.55 49.40 1.03 84.65 1.50 Debentures - - 1,345.88 28.12 2,942.90 51.98 Long-term loans from financial institution 928.65 31.09 1,493.82 31.21 1,222.63 21.59 Unearned lease rights 52.50 1.76 42.24 0.88 31.41 0.55 Provision for long-term employee benefits 51.58 1.73 54.36 1.14 62.79 1.11 Deferred tax liabilities 17.01 0.57 16.00 0.33 16.76 0.30 Other non-current liabilities 7.24 0.24 6.69 0.14 3.27 0.06 Total Liabilities 2,987.22 100.00 4,787.19 100.00 5,661.60 100.00
40 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Debentures The Company reported outstanding debenture for 2016 year end of THB 1,346 million or 28% of total liabilities. The debentures has no collaterals and will fall due during March 2018 to May 2019 with fixed interest rate between 5.2% to 5.7% per annum. The Company reported outstanding debenture for 2017 year end of THB 2,943 million or 52% of total liabilities. The debentures has no collaterals and will fall due during January 2018 to June 2020 with fixed interest rate between 5.2% to 6.25% per annum.
Consolidated Financial Statement Unit: THB mm As of 31 Dec 15 As of 31 Dec 16 As of 31 Dec 17 Debentures - 1,345.88 2,942.90 Net off with current portion - - (449.72) Net debentures - 1,345.88 2,493.18 Long-term loans from financial institutions The Group Company reported long-term loans from financial institutions for 2015 year end of THB 929 million, or 31% of total liabilities. The current portion which would fall due in a year’s time equaled THB 31 million and the remain was THB 898 million. The change in year end outstanding amount in loan from the previous year is due to more new loans from financial institutions for the Company’s future project development, current project under construction and operation of THB 343 million. However, the Company had repaid the loan of THB 438 million as comply with the agreement. The Group Company reported long-term loans from financial institutions for 2016 year end of THB 1,494 million, or 31% of total liabilities. The current portion which would fall due in a year’s time equaled THB 15 million and the remain was THB 1,479 million. The change in year end outstanding amount in loan from the previous year is due to more new loans from financial institutions for the Company’s future project development, current project under construction and operation of THB 648 million. However, the Company had repaid the loan of THB 83 million as comply with the agreement. The Group Company reported long-term loans from financial institutions for 2017 year end of THB 1,223 million, or 22% of total liabilities. The current portion which would fall due in a year’s time equaled THB 754 million and the remain was THB 469 million. The change in year end outstanding amount in loan from the previous year is due to more new loans from financial institutions for the Company’s future project development, current project under construction and operation of THB 2,072 million. However, the Company had repaid the loan of THB 2,355 million as comply with the agreement.
41 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Consolidated Unit: THB mm As of 31 Dec 15 As of 31 Dec 16 As of 31 Dec 17 Long-term loan 928.65 1,493.82 1,222.63 Netoff with current portion (30.88) (14.80) (753.78) Net long-term loan 897.77 1,479.02 468.85 Trade and other payables The Group Company reported trade and other payables for 2015 year end of THB 254 million; 8% of total liabilities, increased by THB 30 million from 2014. The Group Company reported trade and other payables for 2016 year end of THB 330 million; 7% of total liabilities, increased by THB 7 million from 2015. The Group Company reported trade and other payables for 2017 year end of THB 444 million; 8% of total liabilities, increased by THB 114 million from 2016. The change stemmed from an increase in payable relating to construction of THB 42 million, accrued expenses of THB 37 million, other payables of THB 30 million and trade payables of THB 5 million. Deposits received The Group Company reported outstanding deposits received from the sales of real estate units for 2015 year end of THB 279 million or 9% of total liabilities, increased by THB 191 million from 2014. The Group Company reported outstanding deposits received from the sales of real estate units for 2016 year end of THB 463 million or 10% of total liabilities, increased by THB 184 million from 2015. The increase was due to Hyde Sukhumvit 11 which was launched for sales since March 2015 where the Company received down payments and deposits from customers. The Group Company reported outstanding deposits received from the sales of real estate units for 2016 year end of THB 393 million or 7% of total liabilities, decreased by THB 70 million from 2016 due to the ownership transfers of the units sold. Bills of exchange The Group Company report an outstanding of bills of exchange for 2015 year end of THB 1,149 million or 38% of total liabilities. These bills of exchange would fall due during January – May 2016. THB 700 million – partially issued from the bills of exchange was used repayment of a short-term loan. The Group Company report an outstanding of bills of exchange for 2016 year end of THB 933 million or 19% of total liabilities. These bills of exchange would fall due during January – May 2017.
42 Enclosure 6 (supporting documents for the consideration of Agenda 9)
The Group Company report an outstanding of bills of exchange for 2017 year end of THB 249 million or 4% of total liabilities. These bills of exchange would fall due during January 2018. Short-term loans from related parties and interest payable The Group Company reported short-term loans from related parties and interest payable for 2015 year end of THB 172 million, or 6% of total liabilities, increased by THB 14 million from 2014. The Group Company reported short-term loans from related parties and interest payable for 2016 year end of THB 41 million, or 1% of total liabilities, decreased by THB 131 million from 2015. The Group Company reported short-term loans from related parties and interest payable for 2017 year end of THB 150 million, or 3% of total liabilities, increased by THB 109 million from 2016. Shareholders’ Equity The details of share holders’ equity are as follows:
Consolidated As of 31 Dec As of 31 Dec As of Dec (Unit: THB mm) 15 16 2017 Issued and paid-up capital 2,889.04 2,889.04 2,889.04 Retained earning - appropriate 28.08 34.24 44.93 Retained earning unappropriate (20.86) (21.12) 689.24 Total shareholders’ equity 2,896.26 2,902.16 3,623.21 The Group Company reported total shareholders’ equity for 2015 year end of THB 2,896 million; decreased by THB 136 million or 4% from 2014 due to operating loss and both stock and cash dividends paid out in 2015. The Group Company reported total shareholders’ equity for 2016 year end of THB 2,902 million; increased by THB 6 million or 0.2% from 2015 due to operating profit. The Group Company reported total shareholders’ equity for 2016 year end of THB 3,623 million; increased by THB 721 million or 25% from 2016 due to operating profit. Capital Structure
Consolidated
2015 2016 2017 Debt to Equity (x) 1.03 1.65 1.56 Net debt to Equity (x) 0.65 1.15 0.87
Debt to Equity ratio in 2015 was 1.03x, increased by 0.21x from the previous year due to the issuance of bills of exchange and deposits received for the sales of Hyde Sukhumvit 11 as the ownership had not been transferred. At the same time, shareholders’ also decreased due to operating loss of THB 120 million.
43 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Debt to Equity ratio in 2016 was 1.065x, increased by 0.62x from the previous year due to the issuance of debentures and long-term loans from financial institutions. However, shareholders’ equity slightly increased due to operating profit of THB 6 million. Debt to Equity ratio in 2017 was 1.56x, decreased by 0.09x from the previous year due to operating profit of THB 721 million and loan repayment in accordance to the loan agreement where repayment will be made once ownership has been transferred for units in Hyde Sukhumvit 11. However, the Company also issued debentures during the year. Cash Flows
Consolidated 2015 2016 2017 (Unit: THB mm) Cash flows from (used in) operating activities 283.74 (0.39) 738.98 Cash flows from (used in) investing activities (315.75) (1,284.62) (255.92) Cash flows from (used in) financing activities 164.83 1,387.80 454,77 Net cash increase (decrease) 132.82 102.79 937.83
Cash flow from operating activities
During 2015, the sources of cash flows from operating activities included income from hotel business and cash received relating to real estate business such as deposits and cash settlement for ownership transfer of THB 458 million. The Company spent the cash for debt repayment relating to construction of THB 440 million, deposits for construction of THB 167 million and tax of THB 28 million.
During 2016, the sources of cash flows from operating activities included income from hotel business and cash received relating to real estate business such as deposits and cash settlement for ownership transfer of THB 510 million. The Company spent the cash for debt repayment relating to construction of THB 546 million and tax of THB 12 million.
During 2017, the sources of cash flows from operating activities included income from hotel business and cash received relating to real estate business such as deposits and cash settlement for ownership transfer of THB 1,127 million. The Company spent the cash for debt repayment relating to land purchase and construction of THB 344 million and tax of THB 50 million.
Cash flow from investing activities
During 2015, the sources of cash flows from investing activities includes unpledged and restricted withdrawal bank deposits of THB 31 million where the Company spent the cash on tools and equipment for operation, including construction and additional construction on its hotel of THB 295 million.
44 Enclosure 6 (supporting documents for the consideration of Agenda 9)
During 2016, the Company spent the cash on land acquisition of THB 86 million, paid the advance for land acquisition of THB 422 million, paid deposit for hotel construction of THB 117 million and purchased tools and equipment for operation including construction and additional construction on its hotel of THB 665 million.
During 2017, the Company received cash from the disposal of Sheraton HuaHin Resort & Spa to GAHREIT of THB 1,637 million and spent on investing activities such as lending to JV of THB 452 million, paying for investment in JV of THB 480 million, paying for investment properties of THB 176 million, paying for deposit for acquisition of shares in other company of THB 144 million, paying for deposit for hotel construction of THB 39 million and purchased tools and equipment for operation including construction and additional construction on its hotel of THB 608 million.
Cash flow from financing activities
During 2015, the Company received cash from the issuance of bills of exchange and institutional loans of THB 1,654 million. The Company also made some repayments on loans and bills of exchange of THB 1,354 million, paid interest of THB 115 million and paid cash dividend of THB 15 million.
During 2016, the Company received cash from the issuance of bills of exchange of THB 1,771 million, from the issuance of debenture of THB 1,344 million and from institutional loan of THB 645 million. The Company also made some repayments on bills of exchange of THB 2,030 million, repayments on loans from related parties of THB 118 million, repayments on institutional loans of THB 83 million and interest payment of THB 115 million.
During 2017, the Company received cash from the issuance of bills of exchange of THB 789 million, loan from related parties of THB 100 million, issuance of debentures of THB 1,594 million and institutional loans of THB 2,072 million. The Company also made some repayments on bills of exchange of THB 1,488 million, repayments on institutional loans of THB 2,355 million and paid interest of THB 253 million.
Historical dividend payouts during 2009 until today
Dividend Dividend per share For the period Amount Payout Date (THB) (THB mm) 2009 - 2013 No dividend payouts 2014 0.05556 152.87 20 May 2015 2015 -2016 No dividend payouts
5.2 Risk factors Risk factors which may impact the ongoing business of the Company can be summarized as below;
45 Enclosure 6 (supporting documents for the consideration of Agenda 9)
5.2.1 Risk factors for real estate development business • The volatility of both domestic and global economies directly impact upon consumer’s confidence and influence their buying or investment decision. The Company therefore has strategies and steers its business to be in accordance with the economic cycle. In order to cope with such challenge, the Company is more cautious on cost and liquidity management while still aiming to buy new land lots in prime locations and to launch of new projects. • The rise in real estate development costs including the spike in labour cost due to a lack of labour supply, while the ability to raise the selling price is limited. Therefore, the Company puts more emphasize on cost management and prevent the delay in project completion by entering a turnkey-type contract. • Real estate development is capital intensive. As such, the Company relies heavily on institutional loans for its project development. The Company therefore seeks loan supply form reliable and stable financial institutions to aid the project growth, whereby the loan conditions is ideally flexible and most beneficial to the Company. • The changes in interest rate affect the Company’s project costs as well as the customer’s buying or investing decision. The Company’s sources of finance are mainly institutional loans, debentures and bills of exchange. As of 31 December 2017, the Company has total interest-bearing debts of THB 4,564.59 million comprising of the liabilities which bear fixed interest rates of THB 3,341.97 million and the liabilities which bear floating interest rates of THB 672.62 million. In term of the sensitivity analysis, every 1% increase in the interest rate, the Company would bear an extra interest expense of approximately THB 6.72 million from the interest-bearing debts which carry floating rates. Therefore, the Company has adopted the policy to mitigate such interest rate risk by mainly issuing fixed interest-bearing securities. Moreover, the rising interest rate negatively affects the customer’s buying decision due to the higher interest expense. However, the Company’s main group of customers are medium to high income earners who are relatively less sensitive to the change in interest rate, compared to the low income earners. • Ceiling for apartment / condominium foreign ownership affects the Company’s ability to manage and market its projects. Since many of the Company’s projects are located in central business districts, which are highly demanded by foreigners for residential accommodation and non-residential investment, the Company aims to most effectively market and manage around the foreign ownership. • A rise in competition of the real estate business, especially in inner Bangkok area such as Wireless Road, Silom Road and Sathorn Road. The Company therefore put more emphasize on the study of customer’s need by considering the location, design and usage area to be in line with the targeted customer’s requirements to extend the competitive edge. Moreover, the Company offers various
46 Enclosure 6 (supporting documents for the consideration of Agenda 9)
promotions to customers such as 0% interest rate for 10 months, free furniture, special interest rate by coordinating with financial institutions. 5.2.2 Risk Factors for Hotel Business • The volatility of the global and Thailand economy which affects to the Group’s Hotel business in terms of occupancy rate. The Group has increased the marketing activities through the hotel high-experienced management teams. The hotel management would focus on targeted clients in the international market and expand customer base to new markets such as Japan, Singapore, China, Europe, USA and etc. • Emerging competitors both direct and indirect competitors, especially in business districts of Bangkok and on Sukhumvit Road, continues to add the new supply into the market. However, following the infeasibility of new hotel project development in upper upscale market in terms of financial returns, ones would expect gradual decrease in pricing competition. • The increase in the salary and wage costs has adverse impact on the business operation and services. The company have been implemented to reduce number of staff after resign by freeze number of staff and utilized to be Cluster in many position and area example Sale Department have to cluster for three hotels and number in food and beverage team can be rotate from city hotel to resort when high season coming. • Restrictions on leasehold land being the sites of the Group’s hotels require to comply with those specified in the lease agreements. This limits the hotels’ property improvement and flexibility in operating the business. 5.2.3 Risk Factors for capital structure The Company’s Debt to Equity Ratio for the past 3 years; as of 31 December 2015-7 are 1.03x, 1.65x and 1.56x, respectively. In term of Net Debt to Equity ratios, as calculated according to the agreement regarding lender’s right as of 31 December 2015-7 are 0.65x, 1.15x and 0.87x, respectively. The purpose of debentures is for business day-to-day operation and future expansion and/or for purchasing land parcels for new project development and/or to repay bills of exchange, short-term and long-term loans. If the number of new investments does not significantly increase and the Company does not experience operational loss, the Debt to Equity ratio will not change much from before. It is acknowledged that any issuers will maintain Net debt to Equity ratio at 3.0:1 as of the end of accounting period; both quarterly and yearly. Moreover, the Company has a policy to maintain its capital structure at an efficient level as well as will maintain relationship with financial institutions. 5.2.4 Risk Factor for ability to pay interest expense The Company discloses the ratio indicating an ability to meet interest payment, calculated by 2 methods.
47 Enclosure 6 (supporting documents for the consideration of Agenda 9)
EBITDA divided by finance cost: the ratio equal 2.43, 4.57 and 13.43 FYE 2015, 2016 and 2017, respectively Cash flows from operation, Interest expenses from operation and tax divided by Interest expenses from operation and investments: the ratios equal 2.71, 0.08 and 3.12 FYE 2015, 2016 and 2017, respectively. The Company has been in an investing stage for new condominium and hotel construction and land acquisition for future new project development since 2016. The Company has the policy to carefully manage both principal and interest payment. Apart from debentures, the Company also has loan from financial institutions. The undrawn amount as of 31 December 2017 was THB 1,114.80 million.
5.3. The Board of Directors, Management and Top 10 Major Shareholders information as of March 23rd, 2018 (Record Date) 5.3.1 The Board of Directors There were 12 Board of Directors as follows: 1. Mr. Wichai Thongtang Chairman of the Board of Directors 2. Dr. Bhichit Rattakul Vice chairman of the Board of Directors and Chairman of the Board of Executive of Directors 3. Mr. Chainid Adhyanasakul Director and Vice Chairman of the Board of Executive Directors 4. Mr. Vitavas Vibhagool Director, Executive Director and Chief in real estate business 5. Ms. Wilawun Leongnarktongdee Director, Executive Director and Chief Financial Officer 6. Mr. Suradej Narula Director and Executive Director 7. Mr. Amarin Narula Director and Executive Director 8. Mr. Paisit Kaenchan Director, Executive Director and Chief Executive Officer in hotel business 9. Mr. Pornchai Kittipanyangam Independent Director and Chairman of Audit Committee 10. Mr. Wattana Suthipinijtham Independent Director, Audit Committee and Risk Management Committee 11. Mr. Amarit Pansiri Independent Director and Audit Committe 12. Mr. Chaiwat Uthaiwan Independent Director and Risk Management Committee
48 Enclosure 6 (supporting documents for the consideration of Agenda 9)
5.3.2 Company Management The company has 14 management. The name are as followed: 1. Dr. Bhichit Rattakul Chief Executive Offier 2. Mr. Chainid Adhyanasakul Director, Vice Chairman of the Board of Executive Directors and Chief in real estate business 3. Mr. Vitavas Vibhagool Director, Executive Director and Chief in real estate business 4. MS. Wilawun Leongnarktongdee Director, Executive Director and Chief Financial Officer 5. Mr. Suradej Narula Director and Executive Director 6. Mr. Amarin Narula Director and Executive Director 7. Mr. Paisit Kaenchan Director, Executive Director and Chief Executive Officer in hotel business 8. Mr. Somchai Treeratanaphitak Executive Vice President Legal Affairs 9. Mr. Sathit Kiatkrajai Executive Vice President Accounting & Control 10. Mr. Pheeraphon Nonthasoot Executive Vice President Sales and Marketing 11. Ms. Tipaporn Panitpong Chief Operating Officer 12. Mr. Somsak Chaipitoonsawas Executive Vice President Construction, Design and Project Development 13. Mr. Suthipong Jinothai Executive Vice President Business Development 14. Ms. Chadaporn Chayawan Vice President Finance 5.3.3 Top 10 major shareholers
No. Shareholder Name Number of shares Ownership % 1 Metro Premier Holding Company Limited 1,026,558,657 35.53 2 Citynet Asia Limited 206,850,000 7.16 3 Thai Property Public Company Limited 147,000,000 5.08 4 Mr. Surachai Ratithong 144,000,000 4.98 5 Miss Saranya Chaichutaporn 74,023,800 2.56 6 Mr. Tawee Anantarattana 65,531,090 2.26 7 Mr. Vileart Wongapisampho 58,964,005 2.04 8 Property Perfect Public Company Limited 49,099,819 1.70 9 Mr. Theeratat Poolkasame 43,424,115 1.50 10 Mr. Surakit Ratithong 41,500,000 1.43
49 Enclosure 6 (supporting documents for the consideration of Agenda 9)
6. The opinion of the Board of Directors of the Company relating to the sufficiency of working capital; where it is not sufficient, indicate the source of funds to resolve the situation The Board of Directors of the Company is of the view that there is no sufficiency issue regarding the source of fund for this transaction. The Company will seek necessary funding from loan facility from financial institution(s) and fundraising through the issuance of instruments or other securities and/or other sources of funds as appropriate for the acquisition of ROH and the mandatory tender offer for all securities in ROH. The Company expects to submit Form 247-3 on April 23rd, 2018 and the tender offer period will be held from May 8th 2018 to July 10th 2018, total of 45 business days. 7. Material Pending Litigation or Claims As at December 31, 2017, the company and its subsidiaries have no legal disputes which may have a significant impact on the business operations of the company or its subsidiaries. In addition, there is no legal dispute caused by normal operation of the company. However, the subsidiary has one lawsuit filed for damages for a total of Baht 47 million. On 18 December 2014, the Court of First Instance issued a judgment dismissing the plaintiff. Subsequently, on May 26, 2015, the plaintiff appealed the judgment of the Court of First Instance. Subsequently, on July 21, 2015, the subsidiary appealed the appeal to the Court of Appeal. On April 5, 2016, the Pattaya Court read the judgment of the Court of Appeal. The result is that the Court of Appeal has a verdict standing by the verdict of the Court of First Instance. To dismiss the plaintiff and to pay the bills are folded. Subsequently, on July 29, 2016, the plaintiff filed a petition against the verdict of the Court of Appeal on October 3, 2016. The subsidiary filed a petition to the Supreme Court. Subsequently, on December 12, 2017, the Pattaya Court read the Supreme Court's judgment. The result is that the Supreme Court has a verdict of the Court of Appeal. And the bill of lading is supreme. The case is closed. This case is disclosed in the notes to the consolidated financial statements. For ended December 31, 2017, in Article 35.5 8. Related parties and connected transactions Business transactions that are related and / or connected to other businesses and individuals of the Company both directly and indirectly from 10% or above in 2017 Management fee Separate financial Number Name Relationship statement (Unit: THB million) 1 Honor Business Co Ltd Subsidiary 5.20 2 Owendelle Co Ltd Subsidiary 2.00 3 Grade Equity Development Co Ltd Subsidiary 1.20 4 Grande Star Co Ltd JV 12.60
50 Enclosure 6 (supporting documents for the consideration of Agenda 9)
Interest Income Separate Number Name Relationship (Unit: THB million) 1 Honor Business Co Ltd Subsidiary 52.42 2 Owendelle Co Ltd Subsidiary 0.60 3 Grande Star Co Ltd JV 43.41 Interest Expense Separate Number Name Relationship (Unit: THB million) 1 Grade Equity Development Co Ltd Subsidiary 3.47 2 Thai Property PCL Related Party 8.70
9. Summary of Material Agreements in the past 2 years - None - 10. Proxy and List of Independent Directors Please refer to Section 9 and 10 of the Invitation to the 2018 AGM attached herein
m/emin/en6_IM2.docx
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Information Memorandum in relation to the Allotment and Offering of Capital Increase Ordinary Shares.
According to the Board of Directors Meeting of Grande Asset Hotels and Property Public Company Limited (the “Company”) No. 1/2018, held on 14 February 2018, has resolved to approve for submission to the Shareholders meeting for consideration of the change of the allotment of capital increase ordinary shares in the amount of 1,244,248,992 shares, with the par value of 1.- Baht per share, which the Annual General Meeting of Shareholders of the Company for the year 2017, held on 24 April 2017 had resolved to approve for the increase of registered capital and the allotment of the said amount of capital increase ordinary shares for offering in entirety or in portions for offering in lots from time to time to investors in private placement categorized under the Notification of the Capital Market Supervisory Board No. Tor Jor. 72/2558 Re: Approval for the Listed Companies to Offer Newly Issued Shares to Investors in Private Placement, whereby the Board of Directors of the Company or the person who designated by the Board of Directors of the Company shall offer the entire shares within the period not exceeding 12 months from the date of the Annual General Meeting of Shareholders of the Company for the year 2017 had resolved for the approval of such offering shares. But after the Company had been approved from the said Annual General Meeting of Shareholders until now, the Company had not yet allotted and offered such capital increase ordinary shares to investors in private placement due to the fluctuation of the major economic condition and the unfavorable market condition including the negotiation with the investors, who are interesting to invest in the Company, had not been progressed in accordance with the expectation. Meanwhile, the Annual General Meeting of Shareholders for the year 2017 and the relevant Notification of the Capital Market Supervisory Board provides the Company to offer such capital increase ordinary shares within the period not exceeding 12 months from the approval date of the Annual General Meeting of Shareholders which will be due date within this April 2018, resulting that the Board of Directors of the Company could not offer such capital increase ordinary shares to investors in private placement in accordance with the resolution of the Annual General Meeting of Shareholders and the relevant Notification of the Capital Market Supervisory Board. However, the Company is still necessitated to have the resolution for allotment of the capital increase ordinary shares in order for offering to the investors in private placement at the appropriate time and to reserve for accommodation of the investment and development of various projects of the Company and its subsidiaries. In addition, the Company is also required to allot the unissued capital increase ordinary shares to reserve for accommodation of the payment of dividends to the Shareholders of the Company. Therefore, the Board of Directors of the Company No. 1/2018 then proposed to the Annual General Meeting of Shareholders for the year 2018 for consideration of the change of the allotment of capital increase ordinary shares. The Company, therefore, has prepared the Information Memorandum in relation to the Allotment and Offering of Capital Ordinary Shares which consists of the important information effected to the decision of shareholders for consideration and approval of the change of the allotment of capital increase ordinary shares of the Company as follows:
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Enclosure 8 (supporting documents for the consideration of Agenda 10)
1. Details of offering of capital increase ordinary shares. The Board of Directors Meeting of the Company No. 1/2018 has resolved to approve for the change of the allotment of unissued capital increase ordinary shares in the amount of 1,244,248,992 shares, with the par value of 1.- Baht per share, totaling 1,244,248,992.- Baht with the details as follows: 1. Approval for the Company to allot the unissued capital increase ordinary shares in the amount of 115,561,569 shares, with the par value of 1.- Baht per share to reserve for accommodation of the payment of dividends by the ordinary shares to the Shareholders of the Company, which it is required for submission to the Shareholders meeting for consideration and approval of the payment of dividends by ordinary shares to the Shareholders of the Company at the ratio of 25 existing shares to 1 dividend share, being ordinary shares in the amount not exceeding 115,561,569 shares, with the par value of 1.- Baht per share, totaling amount not exceeding 115,561,569.- Baht or equivalent to the rate of payment of share dividends of 0.04 Baht per share. In case of any Shareholder has a friction of existing share after allotment of the dividend share, the dividend shall be paid by cash in place of the payment by ordinary shares at the rate of 0.04 Baht per share. 2. Approval for the Company to allot the unissued capital increase ordinary shares in the amount of 1,128,687,423 shares, with the par value of 1.- Baht per share for offering in entirety or in portions for offering in lots from time to time to investors in private placement categorized under the Notification of the Capital Market Supervisory Board No. Tor Jor. 72/2558 Re: Approval for the Listed Companies to Offer Newly Issued Shares to Investors in Private Placement which such persons are not connected persons of the Company, whereby the Board of Directors of the Company or the person who designated by the Board of Directors of the Company shall have the authority to determine the offering price of the shares at the best market price in accordance with the market condition during the offering period to the investor(s) which shall not lower than 1.- Baht per share and shall not lower than the following price: (1) The weighted average of the Company’s share price trading on the Stock Exchange of Thailand (“SET”) for not lower than 7 consecutive trading days but not exceeding 15 consecutive trading days prior to the determination date of the offering price of such shares (“Market Price”), whereby such weighted average of share price is required to use the average price of shares trading in each day. Provide that, the determination date of offering price is required to backward not exceeding 3 trading days prior to the first date of offering shares to the investor(s). However, the Board of Directors of the Company may determine the discount on the offering price but shall not exceed 10% of such Market Price. (2) The price which is determined by the book building method surveyed by the securities company. In this regard, the Board of Directors of the Company or the person who designated by the Board of Directors of the Company shall offer the entire shares within the period not exceeding 12 months from the date of the Shareholders meeting of the Company has resolved for the approval of such offering shares.
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Enclosure 8 (supporting documents for the consideration of Agenda 10)
3. For the allotment and offering of capital increase ordinary shares of the Company above, the Board of Directors and/or the Executive Committee and/or the authorized director(s) of the Company and/or the person(s) designated by the Board of Directors or the Executive Committee or the authorized directors of the Company shall have the authorities to consider the fixing of other details regarding the allotment and offering of capital increase ordinary shares, such as (1) searching of investors in private placement; (2) fixing of the date, time and place for subscription and payment of the capital increase ordinary shares; (3) fixing of the terms, conditions and details regarding the allotment and offering of capital increase ordinary shares; (4) negotiation, entry into agreement and execution of relevant documents and agreements regarding the allotment and offering of capital increase ordinary shares; and (5) execution of applications for permission and necessary and relevant evidence regarding such allotment and offering of capital increase ordinary shares, including the contacting and submission of applications for such permission, documents and evidence to relevant authorities or agencies, the listing of such capital increase ordinary shares on the Stock Exchange of Thailand and being empowered to take any other action which is necessary and appropriate for the allocation and offering of such capital increase ordinary shares as deemed appropriate by complying with the laws and/or regulations concerned.
2. Objectives of issuance of capital increase shares and plans for utilizing the capital increase fund. For return on the investment to the shareholders of the Company and for use as the working capital and reserve fund for the business operations of the Company and its subsidiaries, repayment of loan and supporting the investment and development in real estate projects of the Company and its subsidiaries, including the hotels, the villas for sale and the residential condominiums for sale. Currently, the Company has three hotels which had been completely constructed and launched for rendering services such as The Westin Grande Sukhumvit Hotel, Sheraton Hua-Hin Resort & Spa Hotel and Sheraton Hua-Hin Pranburi Villas Hotel, and has four real estate projects which had been completely constructed and under the period of sale and ownership transfer such as Hyde Sukhumvit 13, Hyde Sukhumvit 11, Hua-Hin Blue Lagoon and The Trendy Office Condominium Projects. In addition, the Company has a hotel project which is under the construction i.e., Hyatt Regency Bangkok Sukhumvit Hotel, equivalent to the investment value of approximately 3,300 Million Baht which the Company expected that such hotel will be able to launch for rendering services within the second quarter of 2018. Moreover, pursuant to the business plan of the Company for 2018, the Company had planned to launch the new projects such as the real estate project in Rayong province which consists of the hotel, the villas for sale and the residential condominiums for sale, equivalent to the total investment value of approximately 5,794 Million Baht, whereby the Company expects that the villas for sale will be started to construct in the first quarter of 2018, and the hotel will be started to construct in the fourth quarter of 2019, including the residential condominiums for sale will be started to construct in the first quarter of 2020. For Hyde Heritage Thonglor which is the residential condominiums project for sale on Sukhumvit Road, equivalent to the investment value of approximately 6,500 Million, whereby the Company expects that it will be started to construct in the fourth quarter of 2018. Moreover, the Company had planned to renovate the existing hotels to increase the luxury and modern in order to
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Enclosure 8 (supporting documents for the consideration of Agenda 10)
improve the awareness of customers effecting to the brand by upgrade to Luxury Brand and to increase the room rate which the Company expects that it will be started to renovate in the first quarter of 2018. In addition, the Company is under the processes for taking over of Royal Orchid Hotel (Thailand) Public Company Limited (“ROH”) which is the listed company in the Stock Exchange of Thailand and the owner of Royal Orchid Sheraton Hotel & Towers whereby the Company has a plan for renovation of such hotel to increase the luxury and modern in order to increase the room rate as well. Furthermore, the Company had planned to take over hotels in local and foreign country which have launched for rendering services with potential generating revenue. Therefore, the Company is required to have a capital reserve for accommodation of the investment and development of all projects in the future and for use as the working capital in the business operation of the Company and its subsidiaries including for repayment of loan. In this regards, the Company expects that the capital received from the capital increase at this time will help strengthen the financial stability of the Company and when combined with the Company’s existing assets and the revenue generated from the current business operations of the Company, it will enable the Company to achieve its objectives and its specified plans for utilizing the fund.
3. Effect to existing shareholders which may occur from the offering of the capital increase ordinary shares. Effect to existing shareholders which may occur from the offering of the capital increase ordinary shares are as follows:
3.1 Control Dilution Voting rights of new shareholders Voting rights of existing shareholders + Voting rights of new shareholders
(1) In case of the allotment of capital increase ordinary shares to reserve for accommodation of the payment of dividends by ordinary shares to the existing shareholders of the Company. There is no impact on the Control Dilution because it is the allotment to all existing shareholders in proportion to the number of shares held by each of them.
(2) In case of the allotment and offer of capital increase ordinary shares to investors in private placement. = 1,128,687,423 (2,889,039,237 + 115,561,569+1,128,687,423) = 27.31%
3.2 Earnings Per Share Dilution Earnings Per Share before offering - Earnings Per Share after offering Earnings Per Share before offering Earnings Per Share before offering = Net profits / Total issued shares before offering Earnings Per Share after offering = Net profits / Total issued shares after offering
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Enclosure 8 (supporting documents for the consideration of Agenda 10)
(1) In case of the allotment of capital increase ordinary shares to reserve for accommodation of the payment of dividends by ordinary shares to the existing shareholders of the Company. = 0.25 – 0.24 0.25 = 4% (2) In case of the allotment and offer of capital increase ordinary shares to investors in private placement. = 0.24 – 0.18 0.24 = 25% 3.3 Price Dilution (1) In case of the allotment of capital increase ordinary shares to reserve for accommodation of the payment of dividends by ordinary shares to the existing shareholders of the Company. Market price before offering – Market price after offering Market price before offering Whereas the weighted average of ordinary shares price of the Company trading on the Stock Exchange of Thailand for 15 consecutive trading days prior to the determination date of the offering price of capital increase ordinary shares (between 24 January 2018 and 13 February 2018) is of 1.24 Baht per share Market price after offering is equal to: (Market price x Number of paid-up shares) + (Offering price x Number of offering shares) Number of paid-up shares + Number of offering shares = 3,582,408,653.88 + 115,561,569 3,004,600,806 = 1.23 Price Dilution is equal to: = 1.24 – 1.23 1.24 = 0.81% (2) In case of the allotment and offer of capital increase ordinary shares to the investors in private placement. The Price Dilution could not yet be calculated since the offering price is yet to be determined, whereby the Board of Directors of the Company or the person who designated by the Board of Directors of the Company shall have the authority to determine the offering price of the shares at the best market price in accordance with the market condition during the offering period to the investor(s).
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Enclosure 8 (supporting documents for the consideration of Agenda 10)
Although the capital increase and the allotment of the said capital increase shares will affect to the shareholders with the details as prescribed above, the capital increase and the allotment of the said capital increase shares will help strengthen the Company’s financial strength and stability, resulting in lower financial cost of the Company in the future. This also enables the expansion in the investment and the business operation of the Company to be even more effective. As a result, the business operation of the Company has a tendency to growth in the future while the shareholders will benefit from the increased value of the Company and the return on the investment on a regular basis.
4. Opinion of the Board of Directors of the Company.
(1) Reason and necessity of capital increase The Board of Directors is of the opinions that the capital increase and the allotment of the capital increase shares to reserve for accommodation of the payment of dividends by ordinary shares to the existing shareholders of the Company is the return on investment to the Shareholders of the Company in accordance with the dividend policy which is declared by the Company to the Stock Exchange of Thailand, whereby such allotment will hold the financial liquidity of the Company. In addition, the capital increase and the allotment of the capital increase shares to the investors in private placement will expand the capital base of the Company which will help strengthen the Company's financial strength and stability, resulting in lower financial cost of the Company. The proceeds to be gained can be used to monetize the investment and develop the Company which will generate returns for the Company and its shareholders in the future. In this regards, the Company needs to have a reserve fund in order to immediately use in the investment and development of various projects of the Company for the continuity. If the Company is required to provide the loan from financial institutions or through fundraising by issuing various types of debt securities in order for the investment and development of various projects of the Company, it will take time to proceed and bear the costs involved including may incur the risk from the Company could not obtain the amount of loan as required, resulting in the Company may not be able to invest into the potential assets at reasonable price and in a timely manner comparing with its competitors in the hotel and real estate businesses of the Company. Moreover, the Company needs to have another reserve fund to finance working capital in the business operation of the Company and its subsidiaries for the continuity in order for the Company is able to offer various products and effectively compete with other hotel and real estate operators, resulting that the Company will generate the revenue for the continuity and be able to create the return on the investment to the shareholders on a regular basis. The Board of Directors, therefore, has determined that the Company will offer the capital increase shares to investors in private placement with the potential for funding. As a result, the Company will receive funding as need and can be implemented within a short period of time and also does not exceed to create a burden to the existing shareholders of the Company.
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(2) Feasibility of plans for utilizing the fund received from the offering shares. The Board of Directors is of the opinion that if the Company can allocate the said capital increase shares to the investors in private placement within a short period of time, it will enable the Company to effectively achieve its objective of this capital increase pursuant to financial plan that was specified, which will benefit the business of the Company. Pursuant to the 2018 business plan of the Company, the Company has set the target for investment and development of various projects and the location of new hotel and real estate projects including the survey and the feasibility study in the possibility to invest and develop the said projects and if the Company can raise fund from the said offering of shares to the investors in private placement in accordance with its specified target then the Company will be able to carry out the hotel and real estate projects more effectively and more quickly.
(3) Reasonableness of the capital increase, plans for utilizing the fund received from the offering shares and project to be operated including sufficiency of source of fund. The Board of Directors is of the opinion that the Company currently has to borrow from financial institutions and through fundraising by issuing various types of debt securities both in the types of debentures and short-term bill of exchanges, resulting that the Company has huge amount of outstanding interest and fees and other relevant cost. This causes the increase in debt to equity ratio and affects the Company’s ability to make a loan. In addition, the borrowing of a lot of money from financial institutions and through fundraising by issuing various types of debt will require to take the time to proceed and wait for the result of consideration including to apply for the permission from the relevant agencies whereby the Company may not obtain the amount of loan as required. The capital increase and the allotment of the said capital increase shares will help the Company to reduce the debt to equity ratio and the time to proceed including relevant expenses, resulting in strengthen the Company’s financial strength and stability and has readiness in carrying out the objectives mentioned above effectively. The Company expects that the amount to be received from the capital increase, together with credit facilities and working capital will be sufficient to meet the current business operation of the Company to be as planned. In addition, the said capital increase and the allotment of the said capital increase shares will become the working capital and reserve fund for the business operations of the Company and its subsidiaries including the current and the future projects in order to increase the potential in generating income of the Company and its subsidiaries in the future.
(4) Effects that may be occurred to the business operation of the Company, financial status and performance results of the Company due to the capital increase and operation in accordance with the utilizing plan or project. The Board of Directors is of the opinion that the capital increase and the allotment of the said increasing shares capital will be beneficial to the business operation of the Company and will help strengthen the Company's financial strength and stability,
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Enclosure 8 (supporting documents for the consideration of Agenda 10)
resulting in lower financial cost of the Company. This also enables the expansion in the investment and the business operation of the Company in order to effectively compete with other operators. As a result, the business operation of the Company has a tendency to growth in the future.
(5) Certification of the Board of Directors of the Company regarding the capital increase. In case the directors of the Company does not perform their duty in good faith and with care to protect the interests of the Company in relation to the capital increase, If such omission of performance causes damage to the Company, the shareholders are entitled to file a lawsuit to claim for damages from such director on behalf of the Company as specified in Section 85 of the Securities and Exchanges Act B.E. 2535. In addition, if such omission of performance causes a director or his/her related person to obtain undue benefit, the shareholders shall be entitled to file a lawsuit to reclaim for benefits from such director on behalf of the Company as specified in Section 89/18 of the Securities and Exchanges Act B.E. 2535.
Please be informed accordingly.
Yours sincerely,
-Signature- Mr. Chainid Adhyanasakul Director
-Signature- Mr. Amarin Narula Director
m\emin\egm-grande 61/en8-IM for cap inc.doc
8
Enclosure 9
Profiles of Independent Director (Proxy for Shareholders)
Name Mr. Pornchai Kittipanyangam Position Director, Independent Director and Chairman of Audit Committee Nationality Thai Name 71 years Number of shares held in the Company, subsidiaries, affiliated companies or related companies (as of 23 March 2018) - None- Education - Bachelor Degree in Accounting, Thammasat University. Background - Certified Public Accountant, Registration No. 2778. - Certified Public Accountant as approved by the Office of Securities and Exchange Commission. - Thai Institute of Directors Association (IOD): Directors Accreditation Program (DAP), 2004. Work 2012 - Present Independent Director and Chairman of the Audit experience Committee, Grande Asset Hotels and Property Public Company Limited. 2011 - Present Director and Treasurer, Thammasat Association under the Royal Patronage of H.M. The King. 2004 - Present Independent Director and Chairman of the Audit Committee, Samchai Steel Industries Public Company Limited. 1972 - Present Managing Director, Bunchikij Co., Ltd. 2005 - 2009 Qualified Committee, Faculty of Commerce and Accountancy of Thammasat University. 2005 - 2009 Chairman of Alumni Association, Faculty of Commerce and Accountancy of Thammasat University. 2006 - 2007 Senior Advisor of Constitutional Court. Direct and indirect interest in any transaction which the Company, or its subsidiaries is a party. - None-
Remark He is not a director with any special interest in obtaining the allotment of capital increase ordinary shares for offering to the investors in private placement which will be required to approve from the Annual General Meeting of Shareholders for the year 2018.
m/emin/egm-grande 61/en8-dir(proxy).doc Enclosure 9
Profiles of Independent Director (Proxy for Shareholders)
Name Mr. Wattana Suthipinijtham Position Director, Independent Director, Audit Committee and Risk Management Committee Nationality Thai Name 72 years Number of shares held in the Company, subsidiaries, affiliated companies or related companies (as of 23 March 2018) - None- Education - Bachelor Degree in Accounting (Honors), Thammasat University. Background - Master Degree in Accounting, Thammasat University. - Master Degree in Business Administration, New York University, U.S.A. (Scholarship student of the Bank of Thailand) - Certified Public Accountant - Thai Institute of Directors Association (IOD): Directors Accreditation Program (DAP), 2004. Work 2015 - Present Independent Director, Audit Committee and Risk experience Management Committee, Grande Asset Hotels and Property Public Company Limited. 2004 - Present Independent Director and Vice Chairman of the Board, Samchai Steel Industries Public Company Limited. Past Working Group on Capital Market Development & Department of Financial Institution Supervision and Inspection, Bank of Thailand Past Executive Vice President, Siam City Bank Public Company Limited. Past Vice President and Project Director, Hemmaraj Industries Estate Development Public Company Limited. Direct and indirect interest in any transaction which the Company, or its subsidiaries is a party. - None- Remark He is not a director with any special interest in obtaining the allotment of capital increase ordinary shares for offering to the investors in private placement which will be required to approve from the Annual General Meeting of Shareholders for the year 2018.
m/emin/egm-grande 61/en8-dir(proxy).doc สิ่งที่ส่งมาด้วย 10 Enclosure 10 หนังสือมอบฉันทะ แบบ ก. (Form A)
อากรแสตมป์ 20.- บาท (PROXY FORM) Duty Stamp 20.- Baht เขียนที่ Made at วันที่ Date (1) ข้าพเจ้า สัญชาติ I(We), Nationality อยู่บ้านเลขที่ ถนน ตําบล/แขวง Residing at No. Road Sub-district อําเภอ/เขต จังหวัด รหัสไปรษณีย์ District Province Postal Code (2) เป็นผู้ถือหุ้นของบริษัท แกรนด์ แอสเสท โฮเทลส์ แอนด์ พรอพเพอร์ตี้ จํากัด (มหาชน) As a shareholder of Grande Asset Hotels and Property Public Company Limited, โดยถือหุ้นจํานวนทั้งสิ้นรวม หุ้น และออกเสียงลงคะแนนได้เท่ากับ เสียง ดังนี้ holding a total number of shares, and entitled to vote in the number of votes as follows: หุ้นสามัญ หุ้น ออกเสียงลงคะแนนได้เท่ากับ เสียง Ordinary shares of shares, entitled to vote in the number of votes หุ้นบุริมสิทธิ หุ้น ออกเสียงลงคะแนนได้เท่ากับ เสียง Preference shares of shares, entitled to vote in the number of votes (3) ขอมอบฉันทะให้ (ผู้ถือหุ้นสามารถมอบฉันทะให้กรรมการอิสระของบริษัทก็ได้ โดยมีรายละเอียดตามสิ่งที่ส่งมาด้วย 9) Hereby grant (The shareholder may appoint an independent director of the Company to be the proxy, per details as shown in the Enclosure 9) (1) อายุ ปี age years อยู่บ้านเลขที่ ถนน ตําบล/แขวง Residing at No. Road Sub-district อําเภอ/เขต จังหวัด รหัสไปรษณีย์ หรือ District Province Postal Code or (2) อายุ ปี age years อยู่บ้านเลขที่ ถนน ตําบล/แขวง Residing at No. Road Sub-district อําเภอ/เขต จังหวัด รหัสไปรษณีย์ หรือ District Province Postal Code or (3) อายุ ปี age years อยู่บ้านเลขที่ ถนน ตําบล/แขวง Residing at No. Road Sub-district อําเภอ/เขต จังหวัด รหัสไปรษณีย์ District Province Postal Code คนหนึ่งคนใดเพียงคนเดียวเป็นผู้แทนของข้าพเจ้าเพื่อเข้าร่วมประชุมและออกเสียงลงคะแนนแทนข้าพเจ้าในการประชุมสามัญผู้ถือหุ้น ของบริษัทประจําปี 2561 ในวันศุกร์ที่ 20 เมษายน 2561 เวลา 10.00 น. ณ ห้องบอลรูม ชั้น 7 โรงแรมเดอะ เวสทิน แกรนด์ สุขุมวิท เลขที่ 259 ถนนสุขุมวิท แขวงคลองเตยเหนือ เขตวัฒนา กรุงเทพมหานคร หรือที่จะพึงเลื่อนไปในวัน เวลา และสถานที่อื่นด้วย only anyone person as my(our) proxy to attend and vote on my(our) behalf at the Annual General Meeting of Shareholders for the year 2018, to be held on Friday, 20 April 2018 at 10.00 hrs., at the Ballroom, 7th Floor, The Westin Grande Sukhumvit Hotel, No. 259 Sukhumvit Road, Kwaeng Klongtoey Nua, Khet Wattana, Bangkok Metropolis, or at any adjournment thereof to any other date, time and venue. กิจการใดที่ผู้รับมอบฉันทะได้กระทําไปในการประชุมนั้น ให้ถือเสมือนว่า ข้าพเจ้าได้กระทําเองทุกประการ Any act(s) undertaken by the proxy at such meeting shall be deemed as my(our) own act(s) in every respect.
ลงชื่อ ผู้มอบฉันทะ Signed ( ) Grantor
ลงชื่อ ผู้รับมอบฉันทะ Signed ( ) Proxy
ลงชื่อ ผู้รับมอบฉันทะ Signed ( ) Proxy
ลงชื่อ ผู้รับมอบฉันทะ หมายเหตุ/Remarks Signed ( ) Proxy ผู้ถือหุ้นที่มอบฉันทะจะต้องมอบฉันทะให้ผู้รับมอบฉันทะเพียงรายเดียวเป็นผู้เข้าประชุมและออกเสียงลงคะแนน ไม่สามารถแบ่งแยกจํานวนหุ้นให้ผู้รับมอบฉันทะ หลายคนเพื่อแยกการลงคะแนนเสียงได้ A shareholder shall grant only one proxy to attend and vote on his/her behalf at the meeting, and cannot divide his/her shares for several proxies to vote separately. สิ่งที่ส่งมาด้วย 10 Enclosure 10
หนังสือมอบฉันทะ แบบ ข. Proxy Form B.
สําหรับบุคคลธรรมดาและนิติบุคคล For individual and juristic persons
• กรุณาลงนามมอบฉันทะในหน้า 5 และหน้า 6 Please sign your name to appoint a proxy on page 5 and page 6.
• กรุณาแนบเอกสารที่ต้องใช้ประกอบการมอบฉันทะ ตามรายละเอียดที่ระบุ ไว้ใน “สิ่งที่ส่งมาด้วย 11” Please attach the essential documents to appoint a proxy which is detailed in “Enclosure 11”.
• กรุณาส่งเอกสารการมอบฉันทะนี้ทั้งชุดกลับคืนบริษัท Please return the set of this proxy form to the Company.
• ผู้ถือหุ้นสามารถมอบฉันทะให้กับกรรมการอิสระของบริษัทได้ โดยดูข้อมูลกรรมการอิสระที่เป็ นผู้รับมอบฉันทะใน “สิ่งที่ส่งมาด้วย 9” Shareholders could appoint the Company’s Independent Director as the Proxy. Please see the details of “Proxy” in the “Enclosure 9”.
m/emin/agm-grande 61/en10-proxy note.doc สิ่งที่ส่งมาด้วย 10 อากรแสตมป์ 20.- บาท Enclosure 10 Stamp Duty 20.- Baht หนังสือมอบฉันทะ แบบ ข. (Form B) (PROXY FORM) เขียนที่ Made at วันที่ Date (1) ข้าพเจ้า สัญชาติ I(We), Nationality อยู่บ้านเลขที่ ถนน ตําบล/แขวง Residing at No. Road Sub-district อําเภอ/เขต จังหวัด รหัสไปรษณีย์ District Province Postal Code (2) เป็นผู้ถือหุ้นของบริษัท แกรนด์ แอสเสท โฮเทลส์ แอนด์ พรอพเพอร์ตี้ จํากัด (มหาชน) As a shareholder of Grande Asset Hotels and Property Public Company Limited, โดยถือหุ้นจํานวนทั้งสิ้นรวม หุ้น และออกเสียงลงคะแนนได้เท่ากับ เสียง ดังนี้ holding a total number of shares, and entitled to vote in the number of votes as follows: หุ้นสามัญ หุ้น ออกเสียงลงคะแนนได้เท่ากับ เสียง Ordinary shares of shares, entitled to vote in the number of votes หุ้นบุริมสิทธิ หุ้น ออกเสียงลงคะแนนได้เท่ากับ เสียง Preference shares of shares, entitled to vote in the number of votes (3) ขอมอบฉันทะให้ (ผู้ถือหุ้นสามารถมอบฉันทะให้กรรมการอิสระของบริษัทก็ได้ โดยมีรายละเอียดตามสิ่งที่ส่งมาด้วย 9) Hereby grant (The shareholder may appoint an independent director of the Company to be the proxy, per details as shown in the Enclosure 9)
(1) อายุ ปี age years อยู่บ้านเลขที่ ถนน ตําบล/แขวง Residing at No. Road Sub-district อําเภอ/เขต จังหวัด รหัสไปรษณีย์ District Province Postal Code หรือ นายพรชัย กิตติปัญญางาม กรรมการอิสระและประธานกรรมการตรวจสอบ อายุ 71 ปี or Mr. Pornchai Kittipanyangam Independent Director and Chairman of Audit Committee age 71 years อยู่บ้านเลขที่ 121/109 ถนนพญาไท แขวงถนนเพชรบุรี เขตราชเทวี กรุงเทพมหานคร Residing at No. 121/109 Payathai Road, Kwaeng Tanon-Petchaburi, Khet Rachthewee, Bangkok Metropolis. หรือ นายวัฒนา สุทธิพินิจธรรม กรรมการอิสระและกรรมการตรวจสอบ อายุ 72 ปี or Mr. Wattana Suthipinijtham Independent Director and Audit Committee age 72 years อยู่บ้านเลขที่ 3 ซอยเอกชัย 59 แขวงบางบอน เขตบางบอน กรุงเทพมหานคร Residing at No. 3 Soi Ekachai 59, Kwaeng Bangbon, Khet Bangbon, Bangkok Metropolis. คนหนึ่งคนใดเพียงคนเดียวเป็นผู้แทนของข้าพเจ้าเพื่อเข้าร่วมประชุมและออกเสียงลงคะแนนแทนข้าพเจ้าในการประชุมสามัญผู้ถือหุ้น ของบริษัทประจําปี 2561 ในวันศุกร์ที่ 20 เมษายน 2561 เวลา 10.00 น. ณ ห้องบอลรูม ชั้น 7 โรงแรมเดอะ เวสทิน แกรนด์ สุขุมวิท เลขที่ 259 ถนนสุขุมวิท แขวงคลองเตยเหนือ เขตวัฒนา กรุงเทพมหานคร หรือที่จะพึงเลื่อนไปในวัน เวลา และสถานที่อื่นด้วย only anyone person as my(our) proxy to attend and vote on my(our) behalf at the Annual General Meeting of Shareholders for the year 2018, to be held on Friday, 20 April 2018 at 10.00 hrs., at the Ballroom, 7th Floor, The Westin Grande Sukhumvit Hotel, No. 259 Sukhumvit Road, Kwaeng Klongtoey Nua, Khet Wattana, Bangkok Metropolis, or at any adjournment thereof to any other date, time and venue.
หน้า 1 ของจํานวน 6 หน้า (4) ข้าพเจ้าขอมอบฉันทะให้ผู้รับมอบฉันทะออกเสียงลงคะแนนแทนข้าพเจ้าในการประชุมครั้งนี้ ดังนี้
I(we) hereby grant my(our) proxy to vote at this Meeting as follows: วาระที่ 1 เรื่องที่ประธานแจ้งให้ที่ประชุมทราบ
Agenda 1 To acknowledge the matters notified by the Chairman of the Board. วาระที่ 2 พิจารณารับรองรายงานการประชุมสามัญผู้ถือหุ้นของบริษัทประจําปี 2560 ซึ่งประชุมเมื่อวันที่ 24 เมษายน 2560
Agenda 2 To consider and adopt the Minutes of the Annual General Meeting of Shareholders of the Company for the year 2017 held on April 24, 2017. (ก) ให้ผู้รับมอบฉันทะมีสิทธิพิจารณาและลงมติแทนข้าพเจ้าได้ทุกประการตามที่เห็นสมควร
(a) My(our) proxy can consider and vote on behalf of me(us) as he/she may think fit in all respects. (ข) ให้ผู้รับมอบฉันทะออกเสียงลงคะแนนตามความประสงค์ของข้าพเจ้า ดังนี้
(b) My(our) proxy shall vote in accordance with my(our) intention as follows: เห็นด้วย ไม่เห็นด้วย งดออกเสียง
Approve Disapprove Abstain วาระที่ 3 พิจารณารับทราบรายงานผลการดําเนินงานของบริษัทในรอบปี 2560
Agenda 3 To acknowledge the performance results of the Company for the year 2017. วาระที่ 4 พิจารณาอนุมัติงบแสดงฐานะการเงิน ณ วันที่ 31 ธันวาคม 2560 งบกําไรขาดทุนเบ็ดเสร็จ งบแสดง การเปลี่ยนแปลงส่วนของผู้ถือหุ้น และงบกระแสเงินสดสําหรับปีสิ้นสุดวันเดียวกัน
Agenda 4 To consider and approve the statements of financial position as at 31 December 2017, the statements of comprehensive income, changes in shareholders’ equity and cash flows for the year then ended. (ก) ให้ผู้รับมอบฉันทะมีสิทธิพิจารณาและลงมติแทนข้าพเจ้าได้ทุกประการตามที่เห็นสมควร
(a) My(our) proxy can consider and vote on behalf of me(us) as he/she may think fit in all respects. (ข) ให้ผู้รับมอบฉันทะออกเสียงลงคะแนนตามความประสงค์ของข้าพเจ้า ดังนี้
(b) My(our) proxy shall vote in accordance with my(our) intention as follows: เห็นด้วย ไม่เห็นด้วย งดออกเสียง
Approve Disapprove Abstain วาระที่ 5 พิจารณารับทราบการจัดสรรเงินกําไรและการจ่ายเงินปันผลสําหรับผลการดําเนินงานประจําปี 2560
Agenda 5 To acknowledge an appropriation of profits and consider the payment of dividends for the performance results of the fiscal year 2017. (ก) ให้ผู้รับมอบฉันทะมีสิทธิพิจารณาและลงมติแทนข้าพเจ้าได้ทุกประการตามที่เห็นสมควร
(a) My(our) proxy can consider and vote on behalf of me(us) as he/she may think fit in all respects. (ข) ให้ผู้รับมอบฉันทะออกเสียงลงคะแนนตามความประสงค์ของข้าพเจ้า ดังนี้
(b) My(our) proxy shall vote in accordance with my(our) intention as follows: เห็นด้วย ไม่เห็นด้วย งดออกเสียง
Approve Disapprove Abstain วาระที่ 6 พิจารณาเลือกตั้งกรรมการใหม่แทนกรรมการที่ออกจากตําแหน่งตามกําหนดวาระ
Agenda 6 To consider and elect new directors replacing those retiring by rotation. (ก) ให้ผู้รับมอบฉันทะมีสิทธิพิจารณาและลงมติแทนข้าพเจ้าได้ทุกประการตามที่เห็นสมควร
(a) My(our) proxy can consider and vote on behalf of me(us) as he/she may think fit in all respects.
หน้า 2 ของจํานวน 6 หน้า (ข) ให้ผู้รับมอบฉันทะออกเสียงลงคะแนนตามความประสงค์ของข้าพเจ้า ดังนี้
(b) My(our) proxy shall vote in accordance with my(our) intention as follows: การแต่งตั้งกรรมการทั้งชุด Appointment of all directors. เห็นด้วย ไม่เห็นด้วย งดออกเสียง Approve Disapprove Abstain การแต่งตั้งกรรมการเป็นรายบุคคล Appointment of each director. (1) ชื่อกรรมการ : นายวิชัย ทองแตง Director’s Name : Mr. Wichai Thongtang เห็นด้วย ไม่เห็นด้วย งดออกเสียง Approve Disapprove Abstain (2) ชื่อกรรมการ : นายพิจิตต รัตตกุล Director’s Name : Mr. Bhichit Rattakul เห็นด้วย ไม่เห็นด้วย งดออกเสียง Approve Disapprove Abstain (3) ชื่อกรรมการ : นายไพสิฐ แก่นจันทน์ Director’s Name : Mr. Paisit Kaenchan เห็นด้วย ไม่เห็นด้วย งดออกเสียง Approve Disapprove Abstain (4) ชื่อกรรมการ : นายอมฤทธิ์ ปั้นศิริ Director’s Name : Mr. Amarit Pansiri เห็นด้วย ไม่เห็นด้วย งดออกเสียง Approve Disapprove Abstain วาระที่ 7 พิจารณากําหนดเงินค่าตอบแทนกรรมการประจําปี 2561
Agenda 7 To consider and approve the remuneration of the Directors for the year 2018. (ก) ให้ผู้รับมอบฉันทะมีสิทธิพิจารณาและลงมติแทนข้าพเจ้าได้ทุกประการตามที่เห็นสมควร
(a) My(our) proxy can consider and vote on behalf of me(us) as he/she may think fit in all respects. (ข) ให้ผู้รับมอบฉันทะออกเสียงลงคะแนนตามความประสงค์ของข้าพเจ้า ดังนี้
(b) My(our) proxy shall vote in accordance with my(our) intention as follows: เห็นด้วย ไม่เห็นด้วย งดออกเสียง Approve Disapprove Abstain วาระที่ 8 พิจารณาแต่งตั้งผู้สอบบัญชีและกําหนดค่าตอบแทนของผู้สอบบัญชีประจําปี 2561
Agenda 8 To consider and appoint the auditors and to fix the auditor’s remunerations for the year 2018. (ก) ให้ผู้รับมอบฉันทะมีสิทธิพิจารณาและลงมติแทนข้าพเจ้าได้ทุกประการตามที่เห็นสมควร
(a) My(our) proxy can consider and vote on behalf of me(us) as he/she may think fit in all respects. (ข) ให้ผู้รับมอบฉันทะออกเสียงลงคะแนนตามความประสงค์ของข้าพเจ้า ดังนี้
(b) My(our) proxy shall vote in accordance with my(our) intention as follows: เห็นด้วย ไม่เห็นด้วย งดออกเสียง Approve Disapprove Abstain
หน้า 3 ของจํานวน 6 หน้า วาระที่ 9 พิจารณาอนุมัติการเข้าลงทุนในหุ้นสามัญของบริษัท โรงแรมรอยัล ออคิด (ประเทศไทย) จํากัด (มหาชน) (“ROH”) และการทําคําเสนอซื้อหลักทรัพย์ทั้งหมดของ ROH (Tender Offer)
Agenda 9 To consider and approve the entering into of the investment of ordinary shares of Royal Orchid Hotel (Thailand) Public Company Limited (“ROH”) and making of the tender offer of entire securities of ROH. (ก) ให้ผู้รับมอบฉันทะมีสิทธิพิจารณาและลงมติแทนข้าพเจ้าได้ทุกประการตามที่เห็นสมควร
(a) My(our) proxy can consider and vote on behalf of me(us) as he/she may think fit in all respects. (ข) ให้ผู้รับมอบฉันทะออกเสียงลงคะแนนตามความประสงค์ของข้าพเจ้า ดังนี้
(b) My(our) proxy shall vote in accordance with my(our) intention as follows: เห็นด้วย ไม่เห็นด้วย งดออกเสียง
Approve Disapprove Abstain วาระที่ 10 พิจารณาเปลี่ยนแปลงการจัดสรรหุ้นสามัญเพิ่มทุนที่เสนอขายให้แก่บุคคลในวงจํากัด (Private Placement) ตามมติของที่ประชุมสามัญผู้ถือหุ้นของบริษัทประจําปี 2560
Agenda 10 To consider the change of the allotment and offering of capital increase ordinary shares to investors in private placement in accordance with the resolution of the Annual General Meeting of Shareholders of the Company for the year 2017. (ก) ให้ผู้รับมอบฉันทะมีสิทธิพิจารณาและลงมติแทนข้าพเจ้าได้ทุกประการตามที่เห็นสมควร
(a) My(our) proxy can consider and vote on behalf of me(us) as he/she may think fit in all respects. (ข) ให้ผู้รับมอบฉันทะออกเสียงลงคะแนนตามความประสงค์ของข้าพเจ้า ดังนี้
(b) My(our) proxy shall vote in accordance with my(our) intention as follows: เห็นด้วย ไม่เห็นด้วย งดออกเสียง
Approve Disapprove Abstain วาระที่ 11 พิจารณาเรื่องอื่น ๆ (ถ้ามี)
Agenda 11 To consider any other business (if any). (ก) ให้ผู้รับมอบฉันทะมีสิทธิพิจารณาและลงมติแทนข้าพเจ้าได้ทุกประการตามที่เห็นสมควร
(a) My(our) proxy can consider and vote on behalf of me(us) as he/she may think fit in all respects. (ข) ให้ผู้รับมอบฉันทะออกเสียงลงคะแนนตามความประสงค์ของข้าพเจ้า ดังนี้
(b) My(our) proxy shall vote in accordance with my(our) intention as follows: เห็นด้วย ไม่เห็นด้วย งดออกเสียง
Approve Disapprove Abstain (5) การลงคะแนนเสียงของผู้รับมอบฉันทะในวาระใดที่ไม่เป็นไปตามที่ระบุไว้ในหนังสือมอบฉันทะนี้ ให้ถือว่าการลงคะแนน เสียงนั้นไม่ถูกต้อง และไม่ใช่เป็นการลงคะแนนเสียงของข้าพเจ้าในฐานะผู้ถือหุ้น
The vote of the proxy in any agenda which does not follow those specified in this proxy form, it shall be deemed that such vote is incorrect and it does not vote on my(our) behalf as the shareholder.
(6) ในกรณีที่ข้าพเจ้าไม่ได้ระบุความประสงค์ในการออกเสียงลงคะแนนในวาระใดไว้ หรือระบุไว้ไม่ชัดเจน หรือในกรณีที่ที่ประชุม มีการพิจารณาหรือลงมติในเรื่องใดนอกเหนือจากเรื่องที่ระบุไว้ข้างต้น รวมถึงกรณีที่มีการแก้ไขเปลี่ยนแปลงหรือเพิ่มเติมข้อเท็จจริง ประการใด ให้ผู้รับมอบฉันทะมีสิทธิพิจารณาและลงมติแทนข้าพเจ้าได้ทุกประการตามที่เห็นสมควร
In case I(we) do not specify or not clearly specify my(our) intention to vote in any agenda or in case the Meeting considers or votes in the matters other than the matters specified above, including there is the amendment or addition to any facts, the proxy can consider and vote on behalf of me(us) in all respects as he/she may think fit.
หน้า 4 ของจํานวน 6 หน้า กิจการใดที่ผู้รับมอบฉันทะได้กระทําไปในการประชุม เว้นแต่กรณีที่ผู้รับมอบฉันทะไม่ออกเสียงตามที่ข้าพเจ้าระบุในหนังสือ มอบฉันทะ ให้ถือเสมือนว่าข้าพเจ้าได้กระทําเองทุกประการ
Any act(s) undertaken by the proxy at such meeting, except in case the proxy does not vote as I(we) specified in this proxy, shall be deemed as my(our) own act(s) in every respect.
ลงชื่อ ผู้มอบฉันทะ Signed ( ) Grantor
ลงชื่อ ผู้รับมอบฉันทะ Signed ( ) Proxy
ลงชื่อ ผู้รับมอบฉันทะ Signed ( ) Proxy
ลงชื่อ ผู้รับมอบฉันทะ Signed ( ) Proxy
หมายเหตุ/Remarks 1. ผู้ถือหุ้นที่มอบฉันทะจะต้องมอบฉันทะให้ผู้รับมอบฉันทะเพียงรายเดียวเป็นผู้เข้าประชุมและออกเสียงลงคะแนน ไม่สามารถแบ่งแยกจํานวนหุ้นให้ผู้รับมอบ ฉันทะหลายคนเพื่อแยกการลงคะแนนเสียงได้ A shareholder shall grant only one proxy to attend and vote on his/her behalf at the meeting, and cannot divide his/her shares for several proxies to vote separately. 2. วาระเลือกตั้งกรรมการสามารถเลือกตั้งกรรมการทั้งชุดหรือเลือกตั้งกรรมการเป็นรายบุคคล In agenda for election of director(s) can vote to elect all directors or each director. 3. ในกรณีที่มีวาระที่จะพิจารณาในการประชุมมากกว่าวาระที่ระบุไว้ข้างต้น ผู้มอบฉันทะสามารถระบุเพิ่มเติมได้ในใบประจําต่อแบบหนังสือมอบฉันทะแบบ ข. ตามแนบ In case there are more agendas for consideration at the meeting than the agendas specified above, the grantor of the proxy could additionally specify in the Annex to the Proxy Form B as attached.
หน้า 5 ของจํานวน 6 หน้า ใบประจําต่อแบบหนังสือมอบฉันทะแบบ ข. Annex to the Proxy Form B.
การมอบฉันทะในฐานะเป็นผู้ถือหุ้นของบริษัท แกรนด์ แอสเสท โฮเทลส์ แอนด์ พรอพเพอร์ตี้ จํากัด (มหาชน) Grant of proxy as a shareholder of Grande Asset Hotels and Property Public Company Limited ในการประชุมสามัญผู้ถือหุ้นของบริษัทประจําปี 2561 ในวันศุกร์ที่ 20 เมษายน 2561 เวลา 10.00 น. ณ ห้องบอลรูม ชั้น 7 โรงแรมเดอะ เวสทิน แกรนด์ สุขุมวิท เลขที่ 259 ถนนสุขุมวิท แขวงคลองเตยเหนือ เขตวัฒนา กรุงเทพมหานคร หรือที่จะพึงเลื่อนไปในวัน เวลา และสถานที่อื่นด้วย At the Annual General Meeting of Shareholders for the year 2018, to be held on Friday, 20 April 2018 at 10.00 hrs., at the Ballroom, 7th Floor, The Westin Grande Sukhumvit Hotel, No. 259 Sukhumvit Road, Kwaeng Klongtoey Nua, Khet Wattana, Bangkok Metropolis, or at any adjournment thereof to any other date, time and venue. ------
วาระที่ เรื่อง Agenda Subject (ก) ให้ผู้รับมอบฉันทะมีสิทธิพิจารณาและลงมติแทนข้าพเจ้าได้ทุกประการตามที่เห็นสมควร (a) My(our) proxy can consider and vote on behalf of me(us) as he/she may think fit in all respects. (ข) ให้ผู้รับมอบฉันทะออกเสียงลงคะแนนตามความประสงค์ของข้าพเจ้า ดังนี้ (b) My(our) proxy shall vote in accordance with my(our) intention as follows: เห็นด้วย\Approve ไม่เห็นด้วย\Disapprove งดออกเสียง\Abstain วาระที่ เรื่อง Agenda Subject (ก) ให้ผู้รับมอบฉันทะมีสิทธิพิจารณาและลงมติแทนข้าพเจ้าได้ทุกประการตามที่เห็นสมควร (a) My(our) proxy can consider and vote on behalf of me(us) as he/she may think fit in all respects. (ข) ให้ผู้รับมอบฉันทะออกเสียงลงคะแนนตามความประสงค์ของข้าพเจ้า ดังนี้ (b) My(our) proxy shall vote in accordance with my(our) intention as follows: เห็นด้วย\Approve ไม่เห็นด้วย\Disapprove งดออกเสียง\Abstain วาระที่ เรื่อง Agenda Subject (ก) ให้ผู้รับมอบฉันทะมีสิทธิพิจารณาและลงมติแทนข้าพเจ้าได้ทุกประการตามที่เห็นสมควร (a) My(our) proxy can consider and vote on behalf of me(us) as he/she may think fit in all respects. (ข) ให้ผู้รับมอบฉันทะออกเสียงลงคะแนนตามความประสงค์ของข้าพเจ้า ดังนี้ (b) My(our) proxy shall vote in accordance with my(our) intention as follows: เห็นด้วย\Approve ไม่เห็นด้วย\Disapprove งดออกเสียง\Abstain วาระที่ 6 เรื่อง เลือกตั้งกรรมการ (ต่อ) Agenda 6 Subject Election of directors (continue).
ชื่อกรรมการ (Director’s Name): เห็นด้วย\Approve ไม่เห็นด้วย\Disapprove งดออกเสียง\Abstain ชื่อกรรมการ (Director’s Name): เห็นด้วย\Approve ไม่เห็นด้วย\Disapprove งดออกเสียง\Abstain ชื่อกรรมการ (Director’s Name): เห็นด้วย\Approve ไม่เห็นด้วย\Disapprove งดออกเสียง\Abstain ชื่อกรรมการ (Director’s Name): เห็นด้วย\Approve ไม่เห็นด้วย\Disapprove งดออกเสียง\Abstain ชื่อกรรมการ (Director’s Name): เห็นด้วย\Approve ไม่เห็นด้วย\Disapprove งดออกเสียง\Abstain
ข้าพเจ้าขอรับรองว่า รายการในใบประจําต่อหนังสือมอบฉันทะถูกต้องบริบูรณ์และเป็นความจริงทุกประการ I/We certify that the statements in this Supplemental Proxy Form are correct, completed and true in all respects.
ลงชื่อ ผู้มอบฉันทะ Signed ( ) Grantor
ลงชื่อ ผู้รับมอบฉันทะ Signed ( ) Proxy m/emin/agm-grande 61/en10-proxy(b).doc
หน้า 6 ของจํานวน 6 หน้า Enclosure 11
The required documents or evidence to identify the right to attend the Annual General Meeting of Shareholders for the year 2018
For a Natural Person 1. A Thai Nationality. 1.1 The identification card of the shareholder issued by governmental authorities or state enterprises. 1.2 In case of granting of Proxy, copies of identification card of the shareholder and proxy.
2. A Non-Thai Nationality. 2.1 The passport or personal alien document of the shareholder. 2.2 In case of granting of Proxy, copy of passport or personal alien document of the shareholder and proxy.
For Juristic Person 1. A Juristic Person registered in Thailand. 1.1 Certificate issued by the Department of Business Development no longer than 60 days; and 1.2 Copies of identification card or passport or personal alien document both of the authorized director(s) signing in the Proxy Form and the proxy thereof.
2. A Juristic Person registered outside Thailand. 2.1 Certificate; and 2.2 Copy of passport of the authorized director(s) signing in the Proxy Form and the identification card or passport of proxy.
A copy of the aforesaid documents is required to be certified true copy. In case of any documents or evidence executed outside Thailand, such documents or evidence are required to be notarized by a Notary Public.
Remark According to compliance with the Policy of Board of Directors of The Stock Exchange of Thailand Re: the Procedure for Holding of the Shareholders’ Meeting of the Listed Company.
m/emin/agm-grande 61/en10-เกณฑ์ประชุม.doc Enclosure 12
Articles of Association related to the Annual General Meeting of Shareholders
1. Calling of the Shareholders Meeting Article 37. The Board of Directors shall convene an annual general meeting of shareholders within four (4) months from the last day of the accounting period of the Company. All other shareholders meetings of a nature apart from the above mentioned shall be called extraordinary general meetings. The Board of Directors may summon an extraordinary general meeting whenever they deem appropriate. Shareholders holding shares in aggregate of not less than one-fifth (1/5) of the total number of shares sold, or not less than twenty-five (25) shareholders as shareholders holding altogether not less than one-tenth (1/10) of all shares sold, may make a request in writing to the Board of Directors to summon an extraordinary general meeting by clearly specifying therein a reason and purpose for such request. In such case, the Board of Directors shall summon an extraordinary general meeting within one (1) month from the date the shareholders’ request is received. Article 38. In summoning a shareholders meeting, the Board of Directors shall prepare a notice specifying the place, date, time, agenda and matters to be proposed to the meeting; as well as adequate details that clearly indicate whether such matters are proposed for acknowledgement, approval or consideration, as the case may be; and the Board of Directors’ opinions on such matters. The notice shall be sent to the shareholders and the Share Registrar not less than seven (7) days prior to the date of the meeting and published in a newspaper for three (3) consecutive days, not less than three (3) days prior to the date of the meeting. Shareholders meetings shall be held at the head office, or a neighboring province to where the head office is situated, or any other place as the Board of Directors deems appropriate. 2. The Quorum Article 39. At a shareholders meeting, there shall be not less than twenty-five (25) shareholders and proxies (if any) or not less than half the total number of shareholders holding altogether not less than one-third (1/3) of the total shares sold attending the meeting in order to constitute a quorum. At any shareholders meeting, in the event the number of shareholders attending the meeting does not constitute a quorum within one hour after the appointed time, the meeting shall be cancelled if it was summoned at the request of shareholders. If the meeting was not summoned at the request of shareholders, another meeting shall be summoned and a notice summoning the meeting shall be sent to the shareholders not less than seven (7) days before the meeting. At such subsequent meeting, no quorum shall be necessary. Any shares held by the Company will not be counted in determining a quorum. Enclosure 12
Article 40. At a shareholders meeting, the Chairman of the Board of Directors shall be the Chairman of the meeting. In the event there is no Chairman of the Board of Directors, or there is but he is not present or is unable to perform his duty, if there is a Vice-Chairman, the Vice-Chairman shall act as Chairman of the meeting. If there is no Vice-Chairman, or there is but he is unable to perform his duty, the meeting may elect one shareholder present at the meeting to be the Chairman of the meeting. Article 41. At a shareholders meeting, a shareholder may appoint a proxy who has reached maturity to attend the meeting to vote on his behalf. The instrument appointing a proxy shall specify the date and be signed by the shareholder granting the proxy in accordance with the form specified by the Share Registrar. The instrument appointing a proxy shall be submitted to the Chairman or the person designated by the Chairman at the place of the meeting before the proxy holder attends the meeting. 3. Voting Article 42. A resolution passed by a shareholders meeting shall require the following number of votes: (1) In normal cases, a resolution shall be adopted by a majority vote of shareholders present and voting at the meeting. In the case of a tied vote, the Chairman of the meeting shall have a casting vote. (2) In the following cases, a resolution shall be adopted by a vote of not less than three-fourths (3/4) of the total votes of shareholders present and entitled to vote: (a) Sale or transfer, in whole or in essential part, of the business of the Company to other persons; (b) Purchase or acceptance of transfer of business of another company or private company; (c) The execution, amendment, or termination of contracts relating to leasing out of the business of the Company, in whole or in essential part; the entrusting of another person to manage the business affairs of the Company; or the amalgamation of the business with other persons for the purpose of profit and loss sharing; (d) Amendment to the Memorandum of Association and the Articles of Association of the Company; (e) Any capital increase or reduction; (f) The issuance of preference shares, debentures, secured debentures, convertible debentures, warrants or other securities that the Company may issue in accordance with the law; (g) The dissolution of the Company; and (h) The amalgamation of the Company with other companies. Enclosure 12
4. Agenda of the Meeting. Article 43. The following matters shall be transacted at annual general meeting: (a) Reviewing the report of the Board of Directors covering work done during the previous period; (b) Considering the balance sheet and the profit and loss account of the preceding fiscal year; (c) Considering the appropriation of profits; (d) Election of new directors in place of those who must retire on the expiration of their terms; (e) Appointment of the auditor and fixing the auditor’s remuneration; and (f) Other business. 5. Remuneration of Directors and Retired Directors by rotation. Article 19. The Board of Directors shall comprise of not less than five (5) directors and not more than thirteen (13) directors, and not less than half of the total number of directors must have residence in the Kingdom and possess the qualifications required by law. Article 20. The shareholders meeting shall elect directors in accordance with the following rules and procedures: (1) Each shareholder shall be entitled to the number of votes equivalent to the number of shares held by him. (2) Each shareholder may exercise all the votes he has under (1) to appoint one or several persons as directors, but he may not divide his votes for any such persons to any extent. (3) The persons who received the most votes shall be appointed directors, depending on the requirement of directors set at such time. In the event that a number of persons receives an equal number of votes for the last directorship, rendering more than the number of directors required at such time, the Chairman shall have a casting vote. Article 21. At every annual general meeting, one-third of the directors shall retire from office. If the number of directors is not a multiple of three, then the number nearest to one-third must retire from office. The directors who are to retire during the first and second year following the registration of the Company shall be drawn by lots. In every subsequent year, the directors who have been longest in office shall retire. A retiring director is eligible for re-election. Enclosure 12
Article 35. The directors shall be entitled to remuneration comprising a monthly salary, reward, meeting allowance, pension, bonus or other compensation according to the Articles of Association of the Company or the resolution of a shareholders meeting. Such remuneration may be determined as a fixed sum or formula, and to be determined from time to time, or to have continuous effect unless amended. The directors may receive allowance and benefits in accordance with the Company’s regulations. The above paragraph shall not affect the right of the employees to receive compensation where such employees are appointed as directors of the Company. 6. Allocation of the Profit and Payment of Dividend. Article 47. The Company is prohibited from paying dividends out of other funds except profits. In case that the Company continues to record accumulated losses, the Company shall not pay any dividend. Dividend payment is to be divided equally by the number of shares. The Board of Directors may pay an interim dividend to shareholders from time to time if it sees that the Company has sufficient profits to do so, and shall inform the shareholders of such at the next meeting. Dividends shall be paid within one (1) month after the date the resolution was passed by the shareholders meeting or by the Board of Directors meeting, as the case may be. A written notice thereof shall also be sent to the shareholders and the publication of the notice of the payment of dividend shall be made in a newspaper. Article 48. The Company shall appropriate a reserve fund, from the annual net profit, at least five (5) percent of the annual net profit less the total accumulated loss carried forward (if any) until the reserve fund reaches not less than ten (10) percent of the registered capital. Further to such reserve fund, the Board of Directors may propose the shareholders meeting to approve the appropriation of another reserve fund to be used for other purposes as the Board of Directors deems appropriate for the operation of the company.
m/tmin/agm-grande 61/en12-ข้อบังคับ.doc Enclosure 13
แผนที่ของสถานที่จัดการประชุมผู้ถือหุ้น/Map of the venue of the shareholders meeting โรงแรมเดอะ เวสทิน แกรนด์ สุขุมวิท เลขที่ 259 ถนนสุขุมวิท แขวงคลองเตยเหนือ เขตวัฒนา กรุงเทพมหานคร The Westin Grande Sukhumvit Hotel No. 259 Sukhumvit Road, Kwaeng Klongtoey Nua, Khet Wattana, Bangkok
m/emin/agm-grande 61/en13-map hotel.doc