) Information Memorandum : TTW(Amendment in Statistical Table)

calculated from the two head metres at each water distribution station will be used to calculate the water quantity supplied to PWA in that month. The quantity of water distributed at each water distribution station is then added up to find the monthly sale and purchase value as specified in the Water Purchase and Sale Agreement. The Company will monthly calculate the amount of charge for water actually sold to PWA. Where there is a difference between the average quantity of water actually supplied and the MOQ during such period, PWA will pay an extra amount to the Company, which will be calculated by multiplying the water charge rate with the above difference. This extra amount must be paid in 6-month instalments in January and July each year. For Pathum Thani Water, the quantity of water sold by it to PWA each month must be the average water quantity read by the two head metres installed at each water distribution station. The monthly water charge is calculated from that water quantity multiplied by the water charge rate, which is adjusted on 1 January each year. Raw materials and suppliers The important raw materials used in the tap water production process are as follows: (1) Raw water The Company and Pathum Thani Water use water from the central part of the Tha Chin River and the Chao Phraya River, respectively, by pumping water into their water production plants. The Company is permitted to pump water from the Tha Chin River free of charge, except for the waterworks concession fee payable to the Ministry of Natural Resources and Environment as the concession grantor at the annual rate of Baht 200 for each concession. The Company must also pay the inspector's fee in advance at the annual rate of Baht 200 for each concession. As the Company has been granted two concessions, it is obliged to prepay the inspector's fee in the total of Baht 400 per annum. Pathum Thani Water has to pay the waterworks concession fee to the Ministry of Interior as the concession grantor at the annual rate of Baht 200 for each concession (It appeared later that the Ministry of Interior assigned its rights and obligations relating to waterworks business to the Ministry of Natural Resources and Environment). Pathum Thani Water must also pay the inspector's fee in advance at the annual rate of Baht 200 for each concession. In March 2000, Pathum Thani Water advanced the payment of the inspector's expenses to be incurred throughout the 25-year term of the Concession for a total of Baht 5,000. (2) Chemicals The main chemicals used in the Company's tap water production are as follows: - Liquid aluminium potassium sulphate - Potassium permanganate - Liquid chlorine - Calcium hydroxide - Polyelectrolyte The proportion of chemicals used in the production process varies depending on the quality of the raw water at any one time. The water quality is tested by the system called Jar Test and the proportion of chemicals required is then calculated based on the quality of raw water. The data regarding the amount of chemicals is fed into the SCADA System, which controls the injection of chemicals into the production system to ensure that the appropriate amount is injected into the water according to the flow rate of the water pumped into the production process. Pathum Thani Water does not use potassium permanganate in its water production because the quality of water from the Chao Phraya River is different from the quality of water from the Tha Chin River. Raw water from the Tha Chin River contains certain chemicals which cause colouration that can be eliminated by potassium permanganate. The Company purchases raw materials from several suppliers by selecting suppliers whose products meet the accepted standards and the Company's lab quality requirements, and who have the ability to supply products promptly, adequately and at the lowest price. Environmental Impacts The Company and Pathum Thani Water place great importance on conserving the environment. However, the tap water production process produces sludge, which is sent to the dewatering process where polyelectrolyte is added to cause the sludge to stick together before it is deposited in the designated disposal area. As for the water removed from the sludge, it will be transmitted back into the production process. Therefore, there will be zero discharge from the production process. In the past, the Company and Pathum Thani Water have not been involved in a legal dispute and/or litigation relating to environmental issues. The Company The Company conducts an annual test on the sludge in its certified laboratory, as detailed below: - In 2005, a test was conducted by General Environmental Conservation Public Company Limited. The sludge which resulted from the Company's tap water production process was not categorised as hazardous waste. - In 2006, a test was conducted by S.P.S. Consulting Service Co., Ltd. (the laboratory certified by the Thai Industrial Standards Institute, certification no. 0107). It was found that the sludge which resulted from the Company's tap water production process was not categorised as hazardous waste. - In 2007, a test was conducted by S.P.S. Consulting Service Co., Ltd. (the laboratory certified by the Thai Industrial Standards Institute, certification no. 0107). It was found that the sludge which resulted from the Company's tap water production process was not categorised as hazardous waste. In relation to the chemical waste left in the water that has been used for cleaning in the laboratory, the Company engages an authorised chemical treatment company to eliminate the chemical waste approximately once a year on an ad hoc basis. The Company has never entered into a contract with such companies because the amount of chemical waste per year is minimal. Moreover, the Company strictly complies with all applicable environmental laws and supports and coordinates with both national and local environmental authorities, including the Regional Environment Office 5, Ministry of Natural Resources and Environment, Nakornpathom Province and We love the Tha Chin River Club by consulting with such bodies and promoting programmes for the sustainable development and conservation of the Tha Chin River in order to conserve water resources for the community and ensure that the Company has reliable raw water source for its production of good quality water for years to come. Pathum Thani Water Based on the analysis conducted by General Environmental Conservation Public Company Limited (GENCO) in 1999, the sludge that is left from production was not classified as hazardous waste. Pathum Thani Water gives the sludge for free to third parties who desire to use it to fill land. As for the chemical waste left in the water that has been used for cleaning in the laboratory, the storage tank and the mixing tank, Pathum Thani Water previously had a one-year renewable contract with GENCO to eliminate the chemical waste. Pathum Thani Water sent around 5 tons of chemical waste to GENCO for treatment once a year. However, Pathum Thani Water did not renew the contract when it ended in 2006, as Pathum Thani Water and GENCO considered that the chemical waste to be treated was not in the category of controlled chemical of the Ministry of Industry and was not in large quantity. From then on, Pathum Thani Water engages GENCO to treat its chemical waste on an ad hoc basis without the renewed contract. Summary of Material Agreements Summary of material agreements relating to the business is as follows: The Company 1. Water Purchase and Sale Agreement and Memorandum of Agreement relevant thereto (the Agreement) Parties : PWA and the Company Date of Agreement : 21 September 2000 Term of Agreement : 30 years from 21 July 2004, which is the Effective Date of Sale Objective : PWA designates the Company to produce and sell tap water to it in some districts of Nakornpathom and Samutsakorn Provinces. This is to substitute for the underground water produced by PWA itself and to increase PWA's tap water productivity to meet the consumers' demand. PWA will purchase tap water from the Company and subsequently supply and sell it to end- users through the User Terminal System, while the Company agrees to build the Local Distribution Network System itself. The Company further agrees to enjoy or bear all profits or losses from this investment on its own. The Water Production System and the Local Distribution Network System are the Company's exclusive property which must not be transferred to PWA. Water Purchase and Sale : (1) From the Effective Date of Sale, PWA must purchase the Minimum Off-take Quantity of water from the Company on a daily basis (MOQ), as detailed in the following table: Beginning and MOQ Contractual period Ending Period (cubic metres per day) Effective Date of Sale - Year 2 from 21 July 2004 - 200,000 the Effective Date of Sale 20 July 2006 Year 2 from the Effective Date of Sale - 21 July 2006 - 250,000 Year 4 from the Effective Date of Sale 20 July 2008 Year 4 from the Effective Date of Sale 21 July 2008 - 300,000 and afterwards 20 July 2034 If at any time a purchase is less than the MOQ, PWA must pay the difference in cash to ensure that the MOQ is fully paid. If, after the Effective Date of Sale, PWA wishes to increase the MOQ, written notice must be sent to the Company at least 12 months (or any shorter period as the Company may agree) before the date on which the new rate of the MOQ becomes effective. In no circumstance shall the MOQ be reduced from the existing rate. No matter what happens, the Company has no obligation to increase the MOQ to more than a total of 320,000 cubic metres per day or to increase MOQ effective at any time by an amount less than 50,000 cubic metres per day. (2) If the Company can show with PWA's approval that the demand for tap water in the service areas will exceed 300,000 cubic metres per day or PWA's forecast estimates the same amount as the Company has shown and, in the Company's determination, the expansion of the Water Production System is an efficiently economic investment, then the parties may discuss and agree to increase the MOQ to achieve the MOQ at the adjusted quantity and adjust the water charge rate. Such an increase or adjustment will begin only after the Company obtains financial support to improve its water production capacity. If the Company declines the proposed expansion, or the Company's increased production capacity does not meet the requirements of PWA, or the parties cannot mutually reach a final decision on the proposed expansion, then PWA has the right to acquire the additional water supply with respect to the portion which the Company declines or grant a right to any private entity, although this Agreement remains effective. However, if the required MOQ is equal to 300,000 cubic metres per day or to the increased production capacity which the Company agrees to improve, no additional supply may be acquired from a third party. (3) With effect from the Effective Date of Sale, the Company will report every six months to PWA on the average quantity of actual water supplied. If it appears that the average quantity of water supplied is lower than the MOQ during the relevant period, PWA must pay the Company an additional water charge, calculated as the water charge rate multiplied by the difference between the quantity of water actually supplied and the MOQ during the relevant period. That additional charge becomes payable seven days after receipt of an invoice from the Company. Practically, the Company will record the variable costs which reflect the costs saved by the Company during the relevant 6-month period by not supplying the shortfall in water (the Variable Cost-Saving Amount). The Variable Cost- Saving Amount will be calculated as the shortfall in water multiplied by a discount, which will be adjusted annually according to the agreed formula regarding the water charges and indemnity. The Variable Cost-Saving Amount accrued during any 6-month period (or part of that period) is cumulative throughout the term of the Agreement. Upon full repayment of and discharge from all outstanding debts and obligations owed by the Company to the Financiers under the Credit Facilities Agreement, PWA may deduct the accumulated Variable Cost-Saving Amounts from the water charges owed by PWA to the Company in accordance with the agreed formula regarding the water charges and indemnity. Water charge rate : From the Effective Date of Sale, PWA must pay the Company the monthly water charges based on the standard rate applicable in 1999, i.e. Baht 13.900000 per cubic metre, not including VAT. This rate will be reviewed on 1 January each year according to the formula as specified in the Agreement. Renewal of the Agreement : This Agreement is due to expire after 30 years from the Effective Date of Sale. To extend the term of the Agreement, the Company must send written notice to PWA at least three years before the Agreement ends. PWA may approve the renewal, depending on mutual agreement of the parties. However, if no conclusion is reached before the Agreement ends, the Agreement will be automatically terminated as originally agreed. Termination of the Agreement: (1) PWA may terminate the Agreement if any of the following events occurs: (a) The Company does not start the project on schedule. (b) The Company fails to produce the Minimum Availability Quantity because of its own fault or any event within its control. (c) The capacity of the Water Production System significantly decelerates to the extent that the Minimum Availability Quantity is reduced by 70%, thereby failing to satisfy PWA's requirements for more than 90 consecutive days. (d) The system does not produce qualified standard of tap water for more than 60 consecutive days. (e) The Company is dissolved, enters into liquidation, is subject to a temporary or permanent receivership order, is declared bankrupt, an official receiver is appointed in respect of it or its assets or similar proceedings are begun in relation to it and, in each case, no challenge is made within 30 days. (f) The Company is in material breach of the Agreement and that breach has a negative impact on PWA's operations. (g) The Company fails to provide additional required security within 90 days after receiving notice from PWA. However, in the case of a substantial decrease in the Company's water production capacity or the sub-standard quality of its tap water, the Company must remedy the event of default within 30 days after receiving notice from PWA. Failure by the Company to remedy any of the above events entitles the Financiers to appoint a new water producer to replace the Company. Under those circumstances, PWA is not entitled to terminate the Agreement and the Company remains liable under the Agreement in all respects until PWA is fully indemnified. However, if the Financiers do not appoint a substitute water producer, PWA may terminate the Agreement immediately. If any of the above events occurs, PWA must send a written notice to the Company detailing the event of default and stating that the remedy must be completed within 90 days from the event of default occurs. Nevertheless, the 90-day remedy period shall not apply in the case of (c) and (d), where the period of remedy is reduced to 30 days after receipt of notice or any longer period as PWA may determine. Within 365 days after the Agreement is terminated as a result of any event in (a)-(g), PWA must pay the value of the Water Production System and the Local Distribution Network System, which is equal to the net book value of the Water Production System and the book value before amortisation of the Local Distribution Network System, less retained earnings during the previous fiscal year. Therefore, title to the Water Production System and the Local Distribution Network System will vest in PWA. In return, PWA agrees to bear the liability of the Company to the Financiers under the Credit Facilities Agreement for interest and penalties which may be incurred after the 90-day period following the termination of the Agreement until the date on which (i) the outstanding amounts under the Credit Facilities Agreement become due or (ii) PWA fully pays the Company for the water systems, whichever is earlier. (2) The Company may terminate the Agreement if any of the following events occurs: (a) PWA is in material breach of the Agreement. (b) Any government agencies obstruct or intervene PWA's operations. (c) PWA defaults on payment. (d) PWA is dissolved or declared bankrupt. (e) PWA is privatised, unless the Company receives written confirmation from a government agency, an authorised person or the new entity emerging from the re-organisation or privatisation of PWA that such a change had no adverse impact on the performance of PWA's obligations to the Company under the Agreement. PWA must indemnify the Company for the termination of the Agreement by paying the outstanding principal and all interest accrued, the owner's equity, all costs and expenses relating to the transfer of the Water Production System, all project finance costs and expenses incurred by the Company and the proceeds from the paid-up capital at the rate of 20% per annum for the rest of the term of the Agreement. The Water Production System and the Local Distribution Network System will be transferred to PWA immediately upon full payment by PWA. 2. Waterworks Business Concession and Addendum of Amendment to the Waterworks Business Concession dated 20 March 2008 Concession Grantor : Ministry of Natural Resources and Environment Concessionaire : The Company Date of effective concession : 11 March 2005 Concession term : 25 years from the date of the Concession Objective : To grant a concession to the Concessionaire to provide tap water production and distribution services within the areas of Phutthamonthon, Sampran and Nakorn Chaisri Districts in Nakornpathom Province and in Kratoomban and Muang Samutsakorn Districts in Samutsakorn Province or in other areas as the Concession Grantor and the Concessionaire may agree. Right to acquire the tap water business : (1) When the concession business has been operated for half of its full life, the government or any local administration may acquire the Concessionaire's entire tap water business. In that event, the Concession Grantor may withdraw the concession to itself to acquire the Concessionaire's business or allow the local administration to purchase it, in each case, at the market price, provided that notice must be sent to the Concessionaire at least six months in advance. If the acquisition price cannot be reached, the seller and the purchaser must appoint one arbitrator each. If the two appointed arbitrators still cannot make a final decision, they must jointly nominate a third arbitrator to give an award. All costs, charges, fees and expenses relating to the appointment of the arbitrators are equally borne by the parties. (2) Upon expiration or termination of the Concession, the Concession Grantor has the option to acquire the Concessionaire's entire tap water business. If the Concession Grantor decides to acquire, it must do the following: (a) Acquisition after the expiration of the Concession: The Concession Grantor must send a written notice of its intent to the Concessionaire at least six months before the Concession expires. (b) Acquisition after the termination of the Concession: The Concession Grantor must send a written notice of its intent to the Concessionaire within three months after the termination of the Concession. Without such a notice or with a notice declining to acquire the business, the Concessionaire may sell the business to a third party. If the acquisition price cannot be concluded, the parties must appoint the arbitrators in accordance with the procedures specified in the Concession to set up the acquisition price. (3) If the Concession Grantor does not wish to acquire the tap water business and the Concessionaire intends to continue its business, the Concessionaire must send a written notice of its intent to the Concession Grantor at least three months before the Concession expires. Transfer of concession : The Concession is non-transferable, unless the Concession Grantor (more)