information memorandum of asset acquisition … memorandum of asset acquisition propose to...

(Enclosed Document 2)

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translation

Information Memorandum of Asset Acquisition

Propose to Shareholders of Asset Bright Public Co., Ltd.

1. Date of Transaction

Transaction of entire business transfer of “ORCHIDVIEW” that is proposed to sell by an alliance of the

Company’s Chief Executive Officer who introduced and the Company’s Executive Committee assigned Mr.

Premchai Kusolrerkdee, an associate managing director, to be a coordinator of proceeding this transaction. The

transaction will be occurred upon the completion of the Company’s Conditions of Precedent specified in the MOU

(between the Company and “ORCHIDVIEW” dated on 15 October 2015) and the Company will issue promissory

note aval by bank to be a guaranty for the entire business transfer to “ORCHIDVIEW”’s shareholders in the date of

signing the business transfer agreement. The Company will receive the promissory note back once the business

transfer completes or the shareholders’ meeting disapproves this resolution and any issues specified in the business

transfer agreement that will be signed within 14 November 2015 and the Company will complete the entire business

transfer within February 14, 2016 as a time frame but the actual transfer date will specify again in the agreement of

business transfer. The Company has to get approval entire business transfer, capital increase, allotment of newly

issued ordinary shares to private placement investors from the Extraordinary General Meeting of the Company’s

Shareholders no. 1/2015 dated 24 December 2015.

According to the Company signing the MOU in 15 October 2015, the Company has preliminary worked in due

diligence of “ORCHIDVIEW” already and does not find any material issues or any significantly different items from

“ORCHIDVIEW”’s financial statements. However, the Company is working due diligence comprehensively by our

accounting and finance department expected to complete within November 2015. In part of tax and legal advisory, the Company appointed Lawworth Law Office to be our advisor.

2. Involved Parties and Relationships

Transferor : Orchid View Co., Ltd.

Receiver of Newly Issued Ordinary Shares : Shareholders of Orchid View Co., Ltd.

Transferee/Issuer and Seller of Newly Issued Ordinary Shares: Asset Bright Public Co., Ltd.

Relationships between Transferor and Transferee : none


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3. General Characteristic

The Company will purchase and accept to transfer all assets and liabilities of “ORCHIDVIEW” including

any right, obligation and encumbrance having or should have available to “ORCHIDVIEW” at the transferring

date of business under the process of Entire Business Transfer at price of THB483,9 7 5 ,000 of which the

Company will pay by the Company’s 645,300,000 newly issued ordinary shares with par value of THB0.10 per

share to “ORCHIDVIEW” shareholders at offering price of THB0.75 per share for share swap of

“ORCHIDVIEW”’s all 50,000 ordinary shares with par value of THB100 per share with conversion ratio of 1

“ORCHIDVIEW” ordinary share to 12 ,906 the Company’s newly issued ordinary shares (any fraction of a

share shall be discarded) and details of share swap is shown in table below.

Name of “ORCHIDVIEW” Shareholders

Number of “ORCHIDVIEW” Shares

Number of Shares Swapped

1. Mr. Vipad Pakathikom 47,085 607,679,010 2. Miss Kanthida Pakathikom 1,220 15,745,320 3. Miss Kanchanid Pakathikom 1,219 15,732,414 4. Miss Siriwan Kunanopparat 475 6,130,350 5. Mrs. Chulawan Pakathikom 1 12,906

Total 50,000 645,300,000

In the debts acquired from “ORCHIDVIEW”, the Company will accept to transfer all debts available from

“ORCHIDVIEW” at present and future in the transfer completion date.

4. Type and Size of Transaction

The Company proceeds transaction of entire business transfer from “ORCHIDVIEW” with total value of

THB700 million classified by items as follows:

4.1 The value of the Company’s newly issued ordinary shares is THB483,9 7 5 ,000 for share swap of all

“ORCHIDVIEW” ordinary shares.

4.2 “ORCHIDVIEW”’s debts are THB166,025,000 that will repay soon after the Company completes the

entire business transfer.. These debts, classified by THB89 million of long-term loans from financial

institute and THB7 6 million of loans from director, were recorded in “ORCHIDVIEW”’s financial

statements in 30 September 2015. If there are any more borrowing loans than amount agreed at the date of

business transfer, the group of “ORCHIDVIEW”’s shareholders shall be responsible for exceeding

amount. For accounts payable and any other debts such as the amount guaranteed for room and furniture


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rental, Revenue Tax Department payable and audit fee etc. The Company will take responsibility to any

necessary debts involved in “ORCHIDVIEW”’s business operation.

4.3 Investment Costs of THB50 million are used to improve “ORCHIDVIEW”’s rooms and building.

In this transaction of business transfer of a private company by the Company pursuant to Section 107(2) of

Public Company Limited Act B.E. 2535 (as amended), it is also considered as an acquisition of assets in

accordance with the Notification on Acquisition or Disposal class 1 according to Acquisition or Disposal of

Assets by the Capital Market Supervisory Board no, TorJor. 20/2551 Re: Rules for Entering into Substantial

Transactions with the Definition of Acquisition or Disposal of Assets and the Stock Exchange of Thailand (the

SET) Notification Re: Disclosure and Compliance by listed companies relating to Acquisition or Disposal of

Assets B.E.2547 dated 29 October 2547 and the amendment thereto and transaction size can be calculated as

follows:

Financial Information

Unit:million bt.

Financial Information Consolidated Financial Statements

of the Company1

Financial Statements of “ORCHIDVIEW”2

Financial Statements of “ORCHIDVIEW”

in 20145 Total Assets 731.28 33.39 35.20 Net Intangible Assets 27.75 - - Total Liabilities 7.14 172.21 181.46 Shareholders’ Equity 724.15 (138.82) (146.26) Minority Shareholders’ Equity

- - -

NTA 696.40 (138.82) (146.26) Net Profit (Net Loss) (84.10)3 7.444 12.745

Remark 1The Company’s consolidated financial statements are referred to financial statements as of ending

30 September 2015 reviewed by the Company’s certified auditor.

2”ORCHIDVIEW”’s managerial financial statements as of 30 September 2015. 3Net Loss in the Company’s last 4 quarters is during from the first quarter of 2014 to the third

quarter of 2015. 4Net Profit of “ORCHIDVIEW” was from the first 9 months of 2015. 5”ORCHIDVIEW”’s financial statements is reported on December 31, 2014 audited.


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The Calculation Method of Transaction Size regarding Notification of Acquisition or Disposal of Assets

Method Calculation Transaction Size 1. Asset Value %NTA of Acquired Entity

NTA of the Company Cannot calculate as “ORCHIDVIEW”’s NTA is negative.

2. Net Profit %Net Profit of the Acquired Entity Net Profit of the Company

Cannot calculate due to the Company’s net loss

3. Total Return Amount paid or received Total Assets of the Company

7001 = 95.72% 731.28

4. Equity Value Number of New Share Insurance in Return on Asset Acquisition Number of Issued and Paid-up Shares

645.3 = 8.17% 7,902

Remark 1 Payment paid is calculated from number of newly issued ordinary shares offered to

“ORCHIDVIEW” shareholders multiplied by the offering price at THB0.75 per share

THB166,025,000 of “ORCHIDVIEW” debts and estimated THB50 million of budget of building’s

improvement.

Regarding the results of calculation from table above, the largest transaction value is equal to 95.72 percent

based on methods of calculating transaction size considered as Class 1 according to Acquisition or Disposal

of Assets. As a result of that, the Company has to appoint an independent financial advisor to provide an

opinion of entering transaction to the Company’s shareholders and disclose information of transaction to the

SET including arrangement of the shareholders’ meeting in order to request for approval by votes of not less

than third-fourth of total votes of shareholders or proxies present in the meeting and having a right to vote

excluding shareholders having interest (no any shareholders having interest in this transaction). However, the

Company has to submit invitation of shareholder’s meeting including the opinion report from an independent

financial advisor to shareholders in advance with not less than 14 days prior to the date of shareholders’

meeting which is approved by the Board of Directors’ Meeting to propose transaction to the Extraordinary

General Meeting of the Company’s Shareholders no 1/2015 held on 24 December 2015 for considering approval of such transaction.

5. Information of Acquired Assets

Acquired assets from entire business transfer from “ORCHIDVIEW” are assets, and liabilities of

“ORCHIDVIEW” including any right, obligation and encumbrance having or should have available to


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“ORCHIDVIEW” in the date of completion transfer and after that, “ORCHIDVIEW” shall be dissolved and

liquidated. ”ORCHIDVIEW”’s land and property is not obligated or pledged as a guaranty against any debts

from any financial institutes or any persons.

Orchid View Co., Ltd. is founded and registered since 22 December 1987 and it has operated as rental

apartment business for 41 rooms in a 25-storey building with total usable area of 18,420 sq.meters located on

Soi Sukhumvit 33, Sukhumvit Rd., Klongton Sub-District, Klongtoey District, Bangkok. “ORCHIDVIEW”’s

the paid-up capital is THB5 million with total 50,000 ordinary shares and its par value is THB100 per share.

The detail of its project is as follows:

Information of Orchid View Project Developer Orchid View Co., Ltd. Location No. 122 Soi Sukhumvit 33, Sukhumvit Rd., Klongton Sub-District, Klongtoey

District, Bangkok. Land Area 1 rai 66 square wahs Features Service Apartment with a 25-storey building Age of Building About 22 years Number of Rooms 41 rental rooms by daily, monthly and yearly Room Types 40 Rooms with 4 bedrooms and area of 300 sq.m. each and 1 Penthouse with area of

520 sq.m. All units are fully furnished with furniture. Facility 115 parking lots with area of 564 sq.m., elevators, sauna, stream, swimming pool,

fitness room, security system and CCTV etc. Rental Price Now, about THB80,000 – 180,000/room/month

List of Shareholders of Orchid View Co., Ltd. as of 30 April 2015

Name of Shareholders Number of Shares Portion of Holding (%) 1. Mr. Vipad Pakathikom 47,085 94.14 2. Miss Kanthida Pakathikom 1,220 2.44 1. Miss Kanchanid Pakathikom 1,219 2.44 2. Miss Siriwan Kunanopparat 475 0.95 3. Mrs. Chulawan Pakathikom 1 0.00

Total 50,000 100 Source : Department of Business Development


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List of Directors of Orchid View Co., Ltd. as of 15 September 2015

Name of Directors Position 1. Mr. Kitti Pakathikom Director 2. Mr. Vipad Pakathikom Director 3. Miss Siriwan Kunanopparat Director

Source : Department of Business Development

Appraisal of Asset

Advance Appraisal Co., Lld., an independent appraiser who gets a consent from Securities and Exchange Commission (SEC), has evaluated Orchid View Co., Ltd.’s service apartment as of 30 October 2015 by Income Approach that figured out present value of discounted cash flows of such asset by THB660 million and appraised by Cost Approach at THB512,985,000. Furthermore, this asset was recorded at accounting book value as of 30 September 2015 which is about THB27.27 million.

Assumptions of Asset Appraisal

Advance Appraisal Co., Lld. as an independent appraiser takes assumptions for appraisal of the property as follows:

Cost Approach

As the property appraised is an unique asset that was built for special residence, so it cannot find any similar property to compare with. Thus, Advance Appraisal Co., Lld. appraised land by comparison of market price of 7 lots of vacant land located around the property and then take quality and valuable factors such as period of time for sales, negotiation of offering price, location, asset potential, infrastructure, access to property, legal limitation, environment, size of land, goodwill to calculate and find correlation of scores in quality of property and market price under Regression Analysis for asset appraisal.

In part of building appraisal, Replacement Cost is an approach to take standard costs of building specified by Valuers Association of Thailand in 2013. The costs of land and new building in Replacement Cost would be deducted by accumulated depreciation of physical asset or devalue of property use including depreciation from external factors that would be effected to the property value. Thus, Advance Appraisal Co., Lld. appraised average land by THB450,000 per sq.wah and total value of land is equal to THB209,700,000 and total value of apartment is equal to THB303,285,060. Total appraisal value of the property is THB512,985,000 (any fraction is discarded.)

Income Approach

The appraisal value of the property was calculated from Net Present Value of Net Operating Income (after deducting operating expenses) which is earnings before interest, depreciation and tax (EBITDA) plus terminal


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value and take appropriate discount rate. Advance Appraisal Co., Lld. surveyed rental price of 9 properties located in vicinity of the property and then, take all information to analyze with assumptions as following:

1. Estimated Revenues

Advance Appraisal Co., Lld. estimated rental price of a Penthouse room as THB180,730 per room per month and the other 40 rooms at average THB118,690 per room per month. This rental rate is adjusted 10% up in each 3 years. Other revenues such as utilities, telephone bill and internet would be 3% of total rental revenue. The projection of business operation will be calculated in 7 years with occupancy rate of 85% in the first 3 year and 90% from 4th year to 7th year.

2. Estimated Expenses

Salary of 14 staffs is estimated as THB200,000 per month and will be increased by 3% each year, building maintenance by 3% of total revenues, equipment maintenance by 2% of total revenues, fire insurance by 0.1% of building value and 3% increase in each year, and property tax by 12.5% of 40% rental revenues.

3. Discounted Rate is overall rate of return covered by financial costs and risks and Advance Appraisal Co., Lld. determined at 10%.

4. Capitalization Rate is the rate of return in business operation from the property compared to market value of the property. Capitalization Rate is calculated and analyzed from costs of finance and risks of project which is 10% and forecasted growth rate of long-term average income by 3% per year, so the Capitalization Rate is 7%.

Thus, total value of the property appraised by Income Approach is THB660 million (any fraction is discarded.).

6. Total Proceeds

Total proceeds from acquiring an entire business transfer from “ORCHIDVIEW” equals to

THB483,975,000 in which the Company will pay by the Company’s 645,300,000 newly issued ordinary shares

with par value of THB0.10 per share at offering price of THB0.75 per share or total value of THB483,975,000

to swap “ORCHIDVIEW” ordinary shares at the ratio of 1 “ORCHIDVIEW” ordinary share to 12 ,906 the

Company’s newly issued ordinary shares and repay “ORCHIDVIEW” debts by THB166 ,025,000 and pay for

improvement and decoration of building budgeted by THB50 million. So, total amount of proceeds is THB700

million.

However, the offering price of the Company’s newly issued ordinary shares mentioned above is not considered as selling new shares at lower price as the price is not less than 90% of the Company’s weighted average share price in the SET for 15 business days before the Board of Directors’ resolution (calculate from market price of the Company during 13 October – 3 November 2015 which is THB0.63 per share). Thus, issuing


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and offering new ordinary shares to private placement investors has to get approval from the shareholders’ meeting with a vote of not less than third-fourth of total votes of shareholders having a right to vote and attending the meeting.

7. Total Value of Acquired Assets Total value of all assets acquired from “ORCHIDVIEW” is THB700 million which is calculated from total

value of the Company’s newly issued ordinary shares paid to “ORCHIDVIEW” shareholders at 645 ,300,000 shares with offering price of THB0.75 per share or amount of THB4 8 3 ,975,000, THB1 6 6 ,025,000 of “ORCHIDVIEW” debts and THB50 million of improvement budget of the building.

8. Criteria to set the Proceeds Total value of proceeds from “ORCHIDVIEW”’s business transfer can be referred from appraisal value of

“ORCHIDVIEW”’s service apartment appraised by Advance Appraisal Co., Ltd. as an independent appraiser consented by Securities Exchange of Commission (SEC) by income approach that figured out present value of discounted cash flow from asset which is THB660 million as of 30 October 2015 and considers in projected value of the project in the future after completion of improvement and decoration of building and rooms.

9. Potential Benefits to the Company - The Company plans to develop and turn to modern style such as improvement of hall, entrance, and

common areas etc. to build as luxury image. Period of improvement is expected at 2-3 months after asset transfer completed. For marketing approach, the Company plans to appoint a selling agent who is an expert for foreign customers to be our sales representative. The Company expects this asset should create income and net profit to the Company at high yield and it is worthwhile for investment.

-Increase various source of income and diversify to reduce risk of business operation.

10. Sources of Fund/Uses of Fund Transaction of this entire business transfer will be used fund from issuing 645,300,000 new ordinary shares

to “ORCHIDVIEW” at the price of THB0.75 per share and will use the Company’s working capital to repay “ORCHIDVIEW”’s debts of THB166,025,000 and other THB50 million for building improvement.

11. Conditions of the Transaction

The entire business transfer from “ORCHIDVIEW” will occur upon the completion of the conditions of precedent that will be specified in the entire business transfer agreement. The main conditions of precedent should have as follows:


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1. The Company’s Board of Directors’ Meeting and the Shareholders’ Meeting approve the acquisition and entire business transfer from “ORCHIDVIEW” including an approval of any necessary issues related to the entire business transfer

2. The Company’s Board of Directors’ Meeting and the Shareholders’ Meeting approve capital increase and allotment of 6 4 5 ,300,000 new ordinary shares to “ORCHIDVIEW” shareholders at price of THB0.75 per share and also approve to pay THB166 ,025,000 in cash for proceed of entire business transfer.

3. All parties agree and commit agreement of entire business transfer including conditions of precedent specified (unless cancelled or waived by authorized party).

4. The Company and “ORCHIDVIEW” get approval and acceptance from related parties including government entities which are necessary for the selling/transferring/buying entire business transfer. However, the asset acquired is considered as the acquisition of asset based on the Notification on Acquisition or Disposal class 1 according to Acquisition or Disposal of Assets by the Capital Market Supervisory Board no, TorJor. 20/2551 Re: Rules for Entering into Substantial Transactions with the Definition of Acquisition or Disposal of Assets and the Stock Exchange of Thailand (the SET) Notification Re: Disclosure and Compliance by listed companies relating to Acquisition or Disposal of Assets B.E.2547 dated 29 October 2547 and the amendment. The transaction value is equal to 91.52 percent based on methods of calculating transaction size in Total Return compared to the Company and affiliate’s total assets consolidated as of 30 June 2015.

12. Characteristic and Conflict of Interest for Connected Persons

After acquiring the entire business transfer of “ORCHIDVIEW”, shareholders of “ORCHIDVIEW” shall

become the Company’s shareholders by 7.55% of total capital but they would not join as the Company’s directors. Therefore, there does not have any conflict of interest for connected persons.

13. Comparison of Shareholding Structure before and after Transaction by closing date of 8/10/2015

Pre-Transaction Post-Transaction

Name of Shareholders No. of Shares % Name of Shareholders No. of Shares % Mr. Porameth Rungrongtanin 5,810,159,290 73.53 Mr. Porameth Rungrongtanin 5,810,159,290 67.98 Mr. Shinji Tanaka 360,133,451 4.56 Mr. Shinji Tanaka 360,133,451 4.21 Miss Thitinart Na Patalung 118,511,100 1.50 Miss Thitinart Na Patalung 118,511,100 1.39 Miss Nannapas Ajamanwara 105,979,033 1.34 Miss Nannapas Ajamanwara 105,979,033 1.24


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Miss Thaniya Siriyothin 66,402,000 0.84 Miss Thaniya Siriyothin 66,402,000 0.78 Mr. Chaiyuth Sukhavanitnan 63,148,400 0.80 Mr. Chaiyuth Sukhavanitnan 63,148,400 0.74 Miss Pannee Cheonsirisin 34,200,000 0.43 Miss Pannee Cheonsirisin 34,200,000 0.40 Miss Achanan Kuprasertyin 27,000,000 0.34 Miss Achanan Kuprasertyin 27,000,000 0.32 Mr. Rathien Srimongkong 25,222,300 0.32 Mr. Rathien Srimongkong 25,222,300 0.30 Miss Sirirat Tor Suwan 25,107,200 0.32 Miss Sirirat Tor Suwan 25,107,200 0.29 Others 1,266,097,226 16.02 Others 1,266,097,226 14.81 Mr. Vipad Pakathikom 607,679,010 7.11 Miss Kanthida Pakathikom 15,745,320 0.18 Miss Kanchanid Pakathikom 15,732,414 0.18 Miss Siriwan Kunanopparat 6,130,350 0.07 Mrs. Chulawan Pakathikom 12,906 0

Total 7,902,000,000 100 Total 8,547,300,000 100

14. Directors who have interest

-None-

15. Opinion of the Board of Directors on the Transaction

The Board of Directors has an opinion that proceeding transaction of acquiring entire business transfer of

“ORCHIDVIEW” and investment costs including conditions of entire business transfer of ”ORCHIDVIEW”

should be benefits to the Company and shareholders because it is sited in good location which is 800 meters

away from Sukhumvit Rd., near BTS, Emquartier Mall, Samitivej Hospital. Total investment including

improvement costs is THB700 million or average cost of THB56,000 per sq.meter and the Company expects to

earn in high yield under reasonable conditions. Therefore, the Board of Directors’ Meeting no. 7/2015 has passed the resolution of acquiring entire business transfer of “ORCHIDVIEW” by the Company.

16. Opinion of the Board of Directors and/or Audit Committee which is different from 15

-None-

17. Shareholders’ Meeting Invitation

The Company will submit the invitation of the Extraordinary General Meeting of Shareholders no. 1/2015

arranged in 24 December 2015 and opinion of independent financial advisor to the SET at least 5 business days


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before sending to shareholders and submit all documents to shareholders at least 14 days before the meeting date.

18. Responsibilities of the Board of Director on the disclosure of information The Board of Directors is responsible for the information presented in this report which has been prepared

in accordance with the Securities and Exchange Commission of Thailand on Disclosure of Information and other acts of listed companies concerning the Acquisition or Disposition of Assets BE 2547 and the Notification of the Capital Market Supervisory Board No. Tor Chor. 20/2551 on the criteria for making the list significantly to be the Acquisition or Disposition of Assets (including the amendments) with appropriate discretion in revealing important information sufficiently, accurately, transparently and beneficially to the shareholders.

19. The Qualifications of the Independent Property Appraiser

a. Shareholding and Relationship between the Independent Property Appraiser and the Company -None-

b. Consent from the Independent Property Appraiser to public the Appraisal Report Advanced Appraisal Co., Ltd. has consented to reveal this appraisal report for the public use.

c. Date of the Appraisal Report 30 October 2015

20. Obligations and Liabilities

20.1 Total amount of debt instruments - None -

20.2 Total amount of loans of the Company and its subsidiaries with specified repayment period, including the liability to place assets as collateral as of 30 September 2015

-Financial lease amount is about THB1.77 million pledged by car against this loan.

20.3 Total amount of other liabilities including Bank Overdraft and other liabilities to place assets as collateral as of 30 September 2015. The Company and subsidiaries has obligated as following:

-Accounts payable and other payables of THB2.45 million

-Other current liabilities of THB1.5 million

-Deferred tax liabilities of THB0.35 million

-Staff benefit obligation of THB1.39 million 20.4 Contingent Liabilities


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-None-

21. General Information of Asset Bright Public Co., Ltd. 21.1 Nature of Business

Asset Bright Public Company Limited (“ABC” or the Company), formerly known as Bangkok

Nylon Public Company Limited, has founded and registered since 1964 and formerly operated to

produce ready-to-wear socks that customers could specify features and designs of socks including

quality and types of raw materials The Company had started to operate and sell socks for both domestic

and international market since 1967.

The Company had continuously loss from operation since 2012 due to increase of production costs

and expenses such as wages, raw materials, production expenses, transportation etc. However, the

Company could not increase price because sales of products from aboard and small producers were lower

than our price, so the Company’s sales could not meet the target and the Company temporarily suspended

production since 25 December 2012 and laid off staffs in 31 January 2013.

On 30th September 2013, the Company changed structure of main shareholders. The Company’s

former major shareholders sold their shares to Mr. Porameth Rungrongtanin via big lot in the SET and

Mr. Porameth Rungrongtanin made a Tender Offer from the Company’s all shareholders during 1

October – 5 November 2013 regarding to the Notification of the Capital Market Supervisory Board.

The Company’s name has been revised from Bangkok Nylon Public Company Limited to Asset

Bright Public Company Limited since 17 December 2013 and changed the Company’s security symbol

from BNC to ABC since 24 December 2013, onwards.

The Company changed its business operation from textile to real estate and e-commerce business

to make the firm stability. The Company bought all 19 remaining units of Navatara River Life

Condominium project, total areas of 869.88 sq.meters, located on Soi Prasertmanoonkij 33,

Prasertmanoonkij Rd., Klong Kum Sub-district, Bung Kum District, Bangkok with price of THB29.28

million in late of 2013. Presently, all such units were sold out. In 2014, the Company invested 9 units

of Sathorn Chao Phraya Condominium with total areas of 2 , 2 5 8 sq.meters located on Soi

Chareonnakorn 15A, Klong Tonsai Sub-district, Klongsarn District, Bangkok with total price of

THB105 million. Presently, the Company already sold and transferred ownership right by 2 units and

there are 7 units remained.


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In e-commerce business, the Company invested to develop e-commerce website as a selling

agent of products such as electric appliance, mobile phone etc. and services such as hotels, restaurants,

and tours etc. via our website of www.abcpoint.com. Moreover, the Company also sells our brand name

products such as bags, watches imported from aboard in the website operating since late of 2014.

The Company also invested in a subsidiary, ABC Innovation Co., Ltd., by THB510,000 or 51%

of total paid-up capital. Founded since 17 November 2014, ABC Innovation Co., Ltd. plans to support

IT services for all activities but it does not operate yet.

21.2 The Company’s Business Trend

Real Estate Business

The Company plans to invest in resident projects in hotel, resort, apartment for sales or leases in

Bangkok or major cities in Thailand including tourist attraction areas, education location, and

community areas. Even though, the downturn of economy in Thailand and other countries still keeps

going, the Company believes it is an opportunity time to invest interesting property in good location

and reasonable price that could negotiate. However, the demand of real estates in both onshore and

offshore customers is still high and the Company would gain from investment once the economy

recovers in near future.

E-commerce Business

The Company plans to expand service payment to pay by abc points converted from the banks’ credit

card points agreed and joined with the Company for public utility such as electricity bill, water bill,

telephone bill, express way, insurance, installments of credit card or leasing etc. The customers could

make a payment by mobile application that would be a crucial tool to make transaction payment grow

up in the future because of easy to proceed in everywhere and every time.

21.3 Summary of Financial Statement in the past 3 years and the current year

Unit : Thousand Baht

Balance Sheet (Consolidated)

As at 31 December 30 September

2012 2013 2014 2015

Assets

Current assets

Cash and cash equivalent 2,566 18,817 47,700 17,670

Short-term investment 188 - 87,105 283,062

http://www.abcpoint.com/


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2012 2013 2014 2015

Trade receivables and Other receivables 49,254 743 5,453 3,517

Inventories - net 127,481 25,011 107,098 95,879

Other current assets 4,149 3,675 6,529 7,170

Total current assets 183,638 48,246 253,885 407,297

Non-current assets

Cash at financial institutions pledged as collateral - - - 510

Other long-term investment - net 14,880 - - 287,256

Property, plant, and equipment- net 98,094 231,399 6,105 5,991

Intangible assets - net 82 26 2,077 27,746

Other non-current assets - net 3,207 1,147 2,758 2,967

Total non-current assets 116,263 232,572 10,940 324,470

Total assets 299,901 280,818 264,825 731,767

Liabilities and Shareholders’ equity

Current liabilities

Overdraft and short-term loan from

financial institution

97,419 49,000 - -

Trade and other payables 27,532 8,795 9,567 2,447

Current portion of long-term loans 3,600 - 284 297

Short-term loan from related parties - 33,000 - -

Accrued employment termination 40,232 - - -

Other current liabilities 786 102 2,942 1,497

Total current liabilities 169,569 90,897 12,793 4,241

Non-current liabilities

Deferred tax liabilities - 44,626 - 353

Liabilities under finance lease agreements - net - - 1,697 1,472

Employee benefits 5,991 - 503 1,386

Total non-current liabilities 5,991 44,626 2,200 3,212

Total liabilities 175,560 135,523 14,993 7,452

Shareholders’ equity

Share capital


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2012 2013 2014 2015

Registered capital

Ordinary shares,3,292.50 at par value of Baht 0.10

each

Ordinary shares,210.00 at par value of Baht 1 each


163,000

329,250

1,181,788

210,000

Paid-up capital

Ordinary shares,2,634 at par value of Baht 1 each



131,700

131,700

263,400

790,200

Premium on shares 36,500 36,500 36,500 36,500

Retained earnings (Accumulated deficit)

Appropriated

Legal reserve 8,298 8,298 8,298 8,298

Unappropriated (87,173) (209,706) (58,366) (111,765)

Other components of equity - - - 750

Revaluation surplus - 178,503 - -

Non – controlling interests 35,016 - - 338

Total shareholders’ equity 124,341 145,295 249,832 724,315

Total liabilities and shareholders’ equity 299,901 280,818 264,825 731,767


Comphehensive Income Statement (Consolidated)

As at 31 December 30 Sep 15

2012 2013 2014 9 Month

Revenue from sale of goods 319,723 131,905 56,678 45,404

Cost of sales of goods 325,363 174,514 50,985 46,628

Gross (loss) profit (5,640) (42,609) 5,693 (1,224)

Other income 22,986 5,133 3,764 962

Selling expenses 6,230 2,328 22,987 21,166

Administrative expenses 65,209 37,119 37,874 31,991

Other expenses - 46,684 15 -

Finance Cost 3,573 4,707 683 88

Gross (loss) before income tax (57,666) (128,315) (52,101) (53,507)


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Comphehensive Income Statement (Consolidated)

As at 31 December 30 Sep 15

2012 2013 2014 9 Month

Income tax incom - (1,280) - 10

Net gross (loss) for the period (57,666) (127,034) (52,101) (53,498)


Cash Flow Statement

(Consolidated)


2012 2013 2014 2015

Net cash flow from (used in) operating activities (21,199) (5,120) (223,377) (46,154)

Net cash flow from (used in) investing activities (34,917) 46,970 203,712 (510,866)

Net cash flow from (used in) financing activities 57,622 (25,037) 48,547 526,991

Net increase in cash and cash equivalent 1,506 16,813 28,883 (30,030)

Reverse on cash and cash equivalent of subsidiaries - (562) - -

Beginning cash and cash equivalent 1,060 2,566 18,817 47,700

Ending cash and cash equivalent 2,566 18,817 47,700 17,670

Financial Ratio As at 31 December 30 September

2012 2013 2014 2015

Liquidity ratio

Current ratio (Times) 1.08 0.53 19.85 96.04

Quick ratio (Times) 0.30 0.21 10.96 71.74

Cash ratio (Time) (0.16) (0.04) (4.31) (5.42)

Receivables turnover (Times) 4.56 5.46 10.39 12.91

Average collection period (Days) 80 67 35 21

Inventories turnover (Times) 8.90 7.86 0.77 0.46

Average days in inventories (Days) 41 46 473 593

Payable turnover (Times) 8.65 16.00 5.33 7.02

Average days payble (Days) 42 23 68 39

Cash cycle (Days) 79 90 440 569

Profitability ratio

Gross profit margin (%) (1.76) (34.22) 10.04 (2.70)


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Financial Ratio As at 31 December 30 September

2012 2013 2014 2015

Operating profit margin (%) (24.11) (62.21) (90.72) (115.38)

Net profit margin (%) (16.42) 40.84 (91.92) (115.91)

Return on equity (%) (47.92) 47.71 (26.37) (10.98)

Efficiency ratio

Raturn on assets (%) (18.59) 19.28 (27.34) (10.74)

Asset turnover (Times) 1.13 0.47 0.32 0.09

Financial policy ratio

Debt to equity ratio (Times) 1.41 0.93 0.06 0.01

Coverage of debt service (Times) n/a n/a n/a n/a

Ratios Obligation (Times) n/a n/a n/a n/a

Growth rate

Total assets (%) (1.87) (6.36) 127.78 176.32

Total liabilities (%) 43.74 (22.81) (88.89) (50.50)

Revenue from sales and services (%) (2.64) (58.74) (57.03) (84.52)

Net gross (loss) for the period (%) (1,640.37) 199.44 59.40 (57.17)

21.4 Analysis of Financial Position and Operating Results Assets

As at 30 September 2015 , the Company had total assets of THB731.77 million which consisted

of current asset THB406.30 million increasing by THB192.51 million or 76% from last year and of

non-current asset THB731.28 million increasing THB466.46 million or 4,081% from last year due to

main causes as following:

- Short-term investment amount of THB283.06 million as at 30 September 2015 increased THB

236.05 million from last year. As in the year 2015, the company proceeded from paid-up issued

shares and invested in short-term investment as THB268 million of fixed income fund and THB15

million of money market fund.

- Inventories amount of THB95.88 million as at 30 September 2015 decreased THB11.22 million

from last year as the result of sell unit of condominium THB24.82 million. The remaining of Bann

Sathorn Chaophaya condominium unit for sales is THB82.22 million. The Company purchased E-

commerce goods for sales in the year 2015 and their remaining goods is THB13.66 million.


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- Available for sale investments amount of THB267.26 million as at 30 September 2015 increased

THB 227.17 million from last year. As the year 2015, cash which proceeded from paid-up issued

shares and is excess from the company’s operating, invested in available for sale investments as

THB160.81 million of Mid-term fixed income fund, THB6.30 million of equity fund and

THB100.13 million of fixed income fund. Moreover, there is prepayment for long-term

investments of THB20 million.

- Net intangible assets amount of THB27.75 million as at 30 September 2015 increased THB 25.67

million from last year as the result of investment THB27.34 million in development of E-

Commerce system and Service Payment System in order to serve E-Commerce Business including

E-Auction System to serve online property auction.

Liabilities

As at 30 September 2015, the Company had total liabilities of THB7.13 million decreased

THB7.92 million from last year. The main reasons were declining trade payables of THB8.71 million

from last year to be balance of THB2.13 million as result of repayment trade payables

Shareholders’ equity

As at 30 September 2015, the Company had total shareholders’ equity of THB724.15 million

rose THB 474.38 million as the result of paid-up issued shares capital amount of THB 526.80 million

in the period.

Revenue

Revenue from sale of goods in the first nine months of the year 2015 were THB45.40 million

increased by THB18.34 million or increased 68% from the same period of last year as follow;

Revenue from sale of E-Commerce goods amount of THB7.47 million increased entire amount

when compared the same period of the year 2014 as a result of expanding of E-Commerce segment

which has been operated since October 2014

Revenue from real estate amount of THB29.88 million increased THB2.82 million from last

year as the company sold units of condominium which the units of Bann Navatara River Life

Condominium was sold out in this year.

Revenue from event organize amount of THB7.71 million increased entire amount when

compared with the same period of the year 2014 as the result of expanding such segment to support E-

Commerce business


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Gross loss

In the first nine months of the year 2015, the Company had net loss increased THB7.62 million

from the same period of last year or gross loss increase 119.24% as a main result of gross loss in event

organize segment amount of THB5.52 million from missing target sales. However, in the year 2015 the

Company had gross profit from sales of E-Commerce goods amount of THB0.26 million or 3.48% of

its sales and had gross profit from sales of real estate amount of THB3.70 million or 12.40% of its sales.

While there were gross profit in the last year amount of THB6.40 million or 23.18% of its revenues

Expenses

In the first nine months of the year 2015, the Company had selling and administrative expenses

amount of THB52.83 million increased THB22.67 million or increased 75% when compared the same

period of the year 2014 which was amount of THB30.16 million due to selling expense which

advertised for marketing in ABC Point and E-Commerce. Other administrative expenses also increased

from expanding business

Net Loss

In the first nine months of the year 2015, the Company had net loss of THB53.50 million increased

THB32.31 million from the same period of last year or 152.48% increase due to main causes of more

selling and administrative expenses. Moreover revenue from event organize did not cover its cost as result

of net loss for the year.

21.5 Risk Factors that could effect to the Company’s profit (1) Downturn of Economy Due to facing the global economic downturn, the Company’s sales, especially in real estates, have

decreased because of decrease of purchasing power and increase of household debts that make banks strictly screen to approve loans. The Company has to concentrate more in analysis of project selection that should consider in a potential resident project located in community area and good transportation. All factors mentioned will be important to ensure sales of project easier.

(2) High Competition The online business is a fierce competitive market in price, particularly from big Thai and foreign

competitors who reduce huge price to expand market share. Thus, this business has to face risk of high competition and the Company should find unique products or any differentiate products from competitors or create new products such as service payment covering all types of daily life expenses.


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21.6 Name of Management and Top 10 Major Shareholders as of closing date Name of Management as of 8 October 2015

No. Name Position

1. Mr.Porameth Rungrongtanin Chief Executive Officer

2. Mrs.Kantaporn Tongman Managing Director

3. Mr.Jiraphat Veerachayathongkam Deputy Managing Director

4. Mr.Premchai Kusolrerkdee Deputy Managing Director

5. Miss Dares Amonluksathien Vice President of Market and Communication

6. Miss Waradee Bangwan Vice President of Accounting and Finance

Name of Top 10 Shareholders as of 8 October 2015 (latest data) which is the date of closing registered book

No. Name No. of Shares Percent

1. Mr. Porameth Rungrongtanin 5,810,159,290 73.53

2. Mr. Shinji Tanaka 360,133,451 4.56

3. Miss Thitinart Na Patalung 118,551,100 1.50

4. Miss Nannapas Ajamanwara 105,979,033 1.34

5. Miss Thaniya Siriyothin 66,402,000 0.84

6. Mr. Chaiyuth Sukhavanitnan 63,148,400 0.79

7. Miss Pannee Cheonsirisin 34,200,000 0.43

8. Miss Achanan Kuprasertyin 27,000,000 0.34

9. Mr. Rathien Srimongkong 25,222,300 0.32

10. Miss Sirirat Tor Suwan 25,107,200 0.32

Total Shares by major shareholders 6,635,902,774 83.98

Others 1,266,097,226 16.02

Total Shares 7,902,000,000 100.00

Remark: The Company changed par value from THB1 per share to THB0.10 per share to Business Development Department, the Ministry of Commerce in 22 August 2014.

22. The Opinion of the Company’s Board of Directors for Adequacy of Working Capital


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The Company will pay THB1 6 6 million of Orchid View Co., Ltd.’s debts and THB50 million of improvement costs by our working capital while the Company’s cash and temporary investment has THB300 million that is enough to work further.

23. Lawsuits and Significant Legal Concerns during Operation The Company is taking a criminal lawsuit against JL Starnet Trade Co., Ltd. due to default of repayment of deposit in seeking foreign concert by cheque of THB331,700 payable in 14 August 2015.

24. Interests or Related Transactions between the listed company, management and direct or indirect shareholders who hold shares by 10% up -None-

25. Dilution Effect from share allocation to shareholders The newly issued ordinary shares that will be allotted to Private Placement will have a right equal to the Company’s ordinary shares formerly issued. Dilution effect to shareholders due to issuing and offering new ordinary shares to Private Placement based by resolution of the Company’s Board of Directors would be 3 categories as following: 25.1 Price Dilution

Price dilution from issuing and offering new ordinary shares to private placement as Price Dilution = Market Price before offering – Market Price after offering PP

Market Price before offering Market Price before offering = THB0.63 per share1 Market Price after offering PP = (Paid-up shares x Market Price before offering) + (PP shares

x Offering price) Total paid-up shares after capital increase

= (7,902,000,000 x 0.63) + (645,300,000 x 0.75)

(7,902,000,000 + 645,300,000)

= THB0.64 per share

Price Dilution = -1.59%

Existing shareholders will not get any effect from Price Dilution as the offering price is higher than market price.


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Remark: 1Market Price before offering means weighted average price of the Company’s shares traded in the SET within 15 official days before the date of resolution approved by the Board of Directors (calculated from 13 October to 3 November 2015) which is THB0.63 per share.

25.2 Control Dilution Existing shareholders will get an effect on Control Dilution from issuing and offering new ordinary shares to private placement as follow: Control Dilution = PP issued shares Total shares after capital increase

= 645,300,000

(7,902,000,000 + 645,300,000)

= 7.55%

25.3 Earning Dilution Due to the Company facing net loss, existing shareholders will not get an effect on Earning Dilution because number of newly issued ordinary shares are increased in low proportion.

26. Summary of Significant Agreements in last 2 years From the 3rd quarter of 2014, the Company made many agreements with various partners that have

been involved in collaboration as business partners to sell their products in website of “abcpoint” with 1 year contract after signing date and the Company is binding by agreements signed.

On 1 November 2014, the Company signed a three-year subleased contract to rent the headquarter office with guaranty and conditions binding in the agreement.

On 15 September 2014, the Company signed SMS service contract with number of SMS package agreed without period of services regarding the agreement.

On 24 November, 22 October 2014 and 7 January 2015, the Company made agreements to hire foreign artists with many foreign firms for organizing concerts based by conditions in agreements signed.

On 1 April 2015, the Company signed a service contract to develop and design website and application on mobile phones for online business with conditions in the agreement signed.

On 20 July 2015, the Company signed agreement to hire design and production of ABC e-auction books with conditions required in the agreement signed.

On 21 July 2015, the Company signed agreement to develop program for auction of real estates via website with conditions required in the agreement signed.

On 1 August 2015, the Company renewed the MOU of point conversion with bank by the effective period from 1 August 2015 to 31 December 2016 with clauses and conditions in the agreement signed.


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On 10 August 2015, the Company signed service agreement to be agent of water bill payment with 3 years effective and provided letter of guaranty under clauses and conditions in the agreement signed.

On 17 August 2015, the Company signed the MOU of point conversion with bank by the effective period from 17 August 2015 to 31 December 2016 with clauses and conditions in the agreement signed.

On 15 October 2015, the Company signed the MOU to accept the entire business transfer with details in this information memorandum.

On 5 November 2015, the Company signed the agreement to appoint independent financial advisor to give opinion for shareholders with clauses and conditions in the agreement signed.

On 14 November 2015, the Company signed the entire business transfer and share swap agreement and set the date of business transfer within 14 February 2016 or any date agreed by both but not less than 1 March 2016 with clauses and conditions in the agreement signed.

The Company’s Board of Directors hereby certified that the information contained in this report is true and

completed and will not cause any misunderstanding or lack of information that should be disclosed which may cause

damage to the shareholders. In case of the Company’s directors who do not work as integrity or do not take care of

the Company’s interests in matter of capital increase and the results of refraining such works make damage to the

Company, shareholders could make a lawsuit against such director to claim for damage, instead of the Company

regarding to Section 85 in Public Limited Companies Act B.E. 2535. Moreover, if refraining works could make any

directors or any related persons to receive illegal interests, shareholders have a right to claim such interests by taking a lawsuit, instead of the Company regarding to Section 89/18 in Securities and Exchange Act B.E. 2535.

Please be informed accordingly.

Yours sincerely,

Asset Bright Public Company Limited

(Mr. Premchai Kusolrerkdee)

Director

information memorandum of asset acquisition … memorandum of asset acquisition propose to...

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