(ADD4) F/S Q3/98

NOTE 9 - LONG-TERM LOANS In 1996 the parent company obtained the US$ 80,000,000 syndicate loan from 19 banks and financial institutions and the US$ 5,000,000 loan from a foreign bank which bear interest at the rate subject to the SIBOR rate. The principals are repayable at the end of 3 years from the drawdown date and interest payable semi-annually. The lenders may request the Company to repay the loans at the end of 2 years from the drawdown date. Loan covenants include maintenance of important financial ratios to the level as set out in the agreement. Since 1997, the Company cannot maintain the above mentioned financial ratios which may result in the lender calling the loan. As at September 30, 1998, subsidiary company has long-term loans in the amount of Baht 147 million. Long-term loans have been reclassified to long-term loans in default because the subsidiary company cannot comply with the convenants. NOTE 10 - GAIN OF DEBTS RESTRUCTURING In 1998, the parent company and subsidiary have debts restructuring with a bank as per the contract dated August 26, 1998. The Company reduced bank overdraft amounting to approximately Baht 8.51 million. The subsidiary reduced loan from bank amounting to approximately Baht 121.87 million, accounts receivable and notes receivable amounting to approximately Baht 32 million and Baht 41.62 million respectively and recorded the reduced debts amounting to approximately Baht 56.76 million as gain on debts restructuring in the statements of income. In 1997, the subsidiary is under the process of debts restructuring with a bank as per the subsidiary's letter No. SDS 26/2540 date April 30, 1997 and the bank's letters No. Tor 4-400232 dated May 7, 1997 and No. Tor. 4-400300 dated May 13, 1997. The subsidiary reduced the book value amount of loan, bank overdrafts and accrued interests from Baht 99 million to Baht 43 million and recorded the reduced debts amounting to approximately Baht 56 million as gain on debts restructuring in the statement of income. The company has already paid and redeem a mortgage for such debt since August 4, 1997. NOTE 11 - CONTINGENCIES AND COMMITMENTS The Company and subsidiaries have contingent liabilities and commitments as at September 30, 1998 as follows : Million Baht Guarantor of credit facilities of affiliated companies 19.38 Letter of guarantee issued by bank 1,734.10 Letter of credit 6.92 Guarantor of credit facilities of related companies 269.49 Claims under litigation 33.50 In addition, the Company is a guarantor of credit facilities of affiliated companies, not included within the above, amounting to approximately Baht 309.36 million, for which there is a counter guarantee issued by another party in the form of letter guarantee issued by bank. As at September 30, 1998, the parent company and subsidiary have (assets) liabilities in foreign currencies which had not hedged against the value of Thai Baht as follow: Foreign Currencies Amounts French Franc 1,007,684.09 Austrian Schilling 15,702,565.09 Pound Stering 882,883.60 Deutsche Mark 1,419,144.31 US. Dollar 93,009,766.57 Yen 9,913,500.00 Italian Lire 2,866,320.00 Singapore Dollar 856,800.00 NOTE 12 - YEAR 2000 COMPUTER COMPLIANCE (UNREVIEWED) The management has commenced its plan to improve the computerized system in respect of resolving the Year 2000 compliance problem. The plan is expected to be completed within May 1999 and the related expense is insignificant. Although the management expect to have remedied the problem by the time year 2000 occurs, the operations of the Company would still remain at risk from other entities with which the Company undertakes business if those entities are unable to remedy their own problems in time. NOTE 13 - RECLASSIFICATION OF ACCOUNTS Certain accounts in the financial statements for the three-month period and nine-month period ended September 30, 1997 have been reclassified to conform with the presentation in the financial statements for the three-month period and nine-month period ended September 30, 1998.