Interim Dividend Declaration and Calling for EGM

Translation September 16, 2005 Subject : To inform the Board of Directors' resolutions No. 4/2005 To : Director and President The Stock Exchange of Thailand The Board of Director's Meeting of Siam Makro Public Company Limited No. 4/2005 held on September 16, 2005 has adopted the following resolutions: - 1. The meeting unanimously approved the resignation of Mr. Antonio Carlos Pereira Melo from the position of the Company's Director with an effective date as from 15 September 2005 and appointing Mr. Ruurd Jacobus Faber as a new director to replace the resigned director. 2. The meeting unanimously approved the redesignation of the authorized directors as follows: "Number of directors whose signatures bind the Company are Mr. Arsa Sarasin, Mr. Prasert Jarupanich, Mrs. Suchada Ithijarukul, Mrs. Saowaluck Thithapant, Mr. Ruurd Jacobus Faber and Mr. Francisco Henrique Passos Fernandes, any two of these six directors may jointly sign with the Company's seal affixed." 3. The meeting unanimously resolved to propose to Extraordinary General Shareholders' Meeting No. 1/2005 for approval of the Company to declare interim dividend payment. The Company has earned net profit after tax in a 6-month period ended 30 June 2005 in the amount of Baht 475.3 million and retained earnings at the same date in the amount of Baht 3,447.8 million, equivalent to Baht 14.37 per share. At 31 August 2005 the Company has cash at bank in the amount of Baht 3,778 million. The Company should declare interim dividend payment from net profit after tax during 1 January 2005 through 30 June 2005 and some part of retained earnings to all shareholders of the Company at Baht 5 per share for a total number of 240,000,000 shares being the amount of Baht 1,200 million dividends without appropriating an additional legal reserve. The payment of interim dividend shall be made on the 15th day of November 2005. 4. The meeting unanimously resolved to propose to Extraordinary General Shareholders' Meeting No. 1/2005 for approval of the Company to amend the Clause 3 of the Company's Memorandum of Association from having the objectives in the number of 32 clauses to be 33 clauses in order to be consistent with the current business activities rendering by the Company. Detail of the proposed increase of the new objective is as follow: "(33) To engage in business of telecommunication radio or its accessories." The said amendment of the Memorandum of Association must be approved with an affirmative vote of not less than three fourth of the total votes of shareholders attending the meeting and being entitled to vote. 5. The meeting unanimously resolved that the Extraordinary General Shareholders' Meeting No. 1/2005 be held on October 26, 2005 at 3.00 p.m. at Monthathip Room, Radisson Hotel Bangkok. No. 92 Soi Saengcham, Rama 9 Road, Huay Kwang, Bangkok 10320. The Agenda shall be as follows: Agenda 1 To consider and confirm the Minutes of the Annual General Shareholders' Meeting No. 12 (after conversion into a public company limited) held on April 25 2005. Agenda 2 To consider declaring the interim dividend payment to the shareholders of the Company. Agenda 3 To consider approving the amendment of Clause 3 of the Company's Memorandum of Association from having the objectives in the number of 32 clauses to be 33 clauses in order to be consistent with the current business activities rendering by the Company. Detail of the proposed increase of the new objective is as follow: "(33) To engage in business of telecommunication radio or its accessories." The said amendment of the Memorandum of Association must be approved with an affirmative vote of not less than three fourth of the total votes of shareholders attending the meeting and being entitled to vote. Agenda 4 To consider other businesses (if any). 6. The meeting unanimously resolved to close the Company's share register book on October 6, 2005 at noon until the Extraordinary General Shareholders' Meeting No. 1/2005 is over so that the Company could determine the right of the shareholders who would be entitled to attend the Extraordinary General Shareholders' Meeting No. 1/2005 and to receive the interim dividend to be declared by the Extraordinary General Shareholders' Meeting No. 1/2005. 7. The increased expenses from the connected transactions for the year 2005 be ratified. The Company had been approved to enter into the connected transactions for the year 2005 pursuant to the resolutions adopted by the Board of Directors' Meeting No.6/2004 held on 15 December 2004. However, thereafter, there have been additional connected transactions, and some of the approved connected transactions have caused more expenses. Details are as follows: 7.1) Prophix (for preparing Budgets), Software License Agreement pursuant to the following details: 7.1.1) Date of transaction : 1 December 2003 Term of agreemen : No fixed period. Any party may terminate the Agreement by notifying to the other in advance of 3 months before 31 December of every year. Licensor : Orkam Asia Management AG (OAM) Licensee : Siam Makro Plc. (SML) 7.1.2) Type of transaction : SML is granted the right to use software license namely "Prophix" by receiving source code from the other party to be used for preparing budgets and reports. 7.1.3) Total Value of : SML pays one time License fee of Consideration USD 33,000 and additional fee per user of USD 550 for 1st year and USD 110 per user for the following year and any expenses related to our request. SML has to absorb all taxes incurred in relations to payment. 7.1.4) Nature and scope of : OAM is a company of SHV group, interest of connected a major shareholder of SML persons holding directly and indirectly SML shares over 10%. 7.1.5) Company's justification : The software is used for supporting the yearly budgeting, monthly forecasting and reporting process. 7.1.6) Interested Directors : (1) Mr. Francisco Henrique Passos and/or Directors being Fernandes connected persons not (2) Mr. Antonio Carlos Pereira Melo attending the meeting nor having the right to vote Approval expenses : Baht 180,400 (including tax) Actual expenses paid in 2005 : Baht 2,500,000 (including tax) Increased expenses : Baht 2,319,600 Remark: The increased expenses are from Prophix modification, reporting, support budgeting process and including integration Siam Food figures. As at 30 June 2005, the net tangible assets according to the Companys' consolidated financial statement is Baht 9,186 Million. Consequently, the size of above transaction is less than 0.03% equivalent to Baht 2.8 Million. The value of transaction is not required the shareholders' meeting approval. 7.2) Cost of B2B and MBS 2000 enhancement pursuant to the following details: 7.2.1) Date of transaction : 17 December 2004 Reference to B2B Software License Agreement dated 1 September 2000 and MBS 2000 Part II, Software Sub-License Agreement dated 1 January 1999 Service Provider : Orkam Asia Management AG (OAM) Service Receiver : Siam Makro Plc. (SML) 7.2.2) Type of transaction : To modify MBS 2000 and B2B which SML is granted the right to use software license namely "B2B e-commerce" and MBS 2000 by receiving source code from the other party to be used for support operations and sharing and exchanging information through the internet between SML and local suppliers. 7.2.3) Total Value of : USD 37,000 Service Fee 7.2.4) Nature and scope of : OAM is a company of SHV group, interest of connected a major shareholder of SML holding persons directly and indirectly SML shares over 10%. 7.2.5) Company's justification : The software is used in running daily operation and need to modify by the Licensor to match with the current requirements for management efficiency improvement. 7.2.6) Interested Directors : (1) Mr. Francisco Henrique Passos and/or Directors being Fernandes connected persons not (2) Mr. Antonio Carlos Pereira Melo attending the meeting nor having the right to vote Approval expenses : Baht - (including tax) Actual expenses paid in 2005 : Baht 1,730,000 (including tax) Increased expenses : Baht 1,730,000 As at 30 June 2005, the net tangible assets according to the Companys' consolidated financial statement is Baht 9,186 Million. Consequently, the size of above transaction is less than 0.03% equivalent to Baht 2.8 Million. The value of transaction is not required the shareholders' meeting approval. 8. The additional connected transactions for the year 2005 be approved. 8.1) Management Consulting Agreement pursuant to the following details: 8.1.1) Date of transaction : 19 September 2005 Term of agreement : 19 September 2005- 31 March 2006 Service Provider : Total Office Centre (TOC) Service Receiver : Makro Office Centre Co., Ltd. (MOC) 8.1.2) Type of transaction : Training MOC sales team to capture corporate customer for the Contract Delivery Business. 8.1.3) Total Value of : Monthly charges at USD 2,700 plus Service Fee all out of pocket expenses and actual travelling expenses and tax. 8.1.4) Nature and scope of : TOC is a company of SHV group, interest of connected a major shareholder of SML holding persons directly and indirectly SML shares over 10%. 8.1.5) Company's justification : Due to MOC's sale team lacks the skill to capture the customers in this segment. The hire of service from TOC is due to that company has qualified experienced staff in Contract Delivery Business and the service payment paid to that company shall make MOC to have more sales from the additional channel. 8.1.6) Interested Directors : (1) Mr. Francisco Henrique Passos and/or Directors being Fernandes connected persons not (2) Mr. Antonio Carlos Pereira Melo attending the meeting nor having the right to vote Estimated expenses for the year : 2005 Baht 453,600 2006 Baht 340,200 Total Baht 793,800 As at 30 June 2005, the net tangible assets according to the Companys' consolidated financial statement is Baht 9,186 Million. Consequently, the size of above transaction is less than 0.03% equivalent to Baht 2.8 Million. The value of transaction is not required the shareholders' meeting approval. 8.2) Consulting Agreement pursuant to the following details: 8.2.1) Date of transaction : 19 September 2005 Term of agreement : 19 September 2005- 31 December 2006 Service Provider : Makro Asia Management (MAM) Service Receiver : Makro Office Centre Co., Ltd. (MOC) 8.2.2) Type of transaction : Evolve from Operation-based model to sale and customer intimate model, implement operational efficiencies, create and implement model for new concept including development of Contract Delivery Business. 8.2.3) Total Value of : Monthly charge at EUR 11,000 plus Service Fee all out of pocket expenses and actual travelling expenses and tax. 8.2.4) Nature and scope of : MAM is a company of SHV group, interest of connected a major shareholder of SML holding persons directly and indirectly SML shares over 10%. 8.2.5) Company's justification : To enhance MOC's efficiency and growth, it is necessary to hire MAM to advise in new business model improvement, efficiency improvement and the expansion in Contract Delivery Business. 8.2.6) Interested Directors : (1) Mr. Francisco Henrique Passos and/or Directors being Fernandes connected persons not (2) Mr. Antonio Carlos Pereira Melo attending the meeting nor having the right to vote Estimated expenses for the year : 2005 Baht 2,288,000 2006 Baht 5,668,000 Total Baht 7,956,000 As at 30 June 2005, the net tangible assets according to the Company's consolidated financial statement is Baht 9,186 Million. Consequently, the size of above transaction is over 0.03% equivalent to Baht 2.8 Million but less than 3% equivalent to Baht 276 Million. The value of transaction is not required the shareholders' meeting approval. 8.3) Business Intelligence System (BI), Software License Agreement pursuant to the following details: 8.3.1) Date of transaction : 19 September 2005 Term of agreement : 1 year, to be renewed on yearly basis Licensor : Orkam Asia Management AG (OAM) Licensee : Siam Makro Plc. (SML) 8.3.2) Type of transaction : SML is granted the right to use software license in relation to BI System by receiving source code from the other party to be used. 8.3.3) Total Value of : EUR 225,922 (approximately Baht Consideration 11.6 million). SML has to absorb all taxes incurred in relations to payment. 8.3.4) Nature and scope of : OAM is a company of SHV group, interest of connected a major shareholder of SML holding persons directly and indirectly SML shares over 10%. 8.3.5) Company's justification : BI Project involves the utilization of new software and related hardware via the Company's computer system of the head office and all stores to increase efficiency on the Company's information management. 8.3.6) Interested Directors : (1) Mr. Francisco Henrique Passos and/or Directors being Fernandes connected persons not (2) Mr. Antonio Carlos Pereira Melo attending the meeting nor having the right to vote Estimated expenses for the year : Baht 12,803,000 2005 (including tax) As at 30 June 2005, the net tangible assets according to the Company's consolidated financial statement is Baht 9,186 Million. Consequently, the size of above transaction is over 0.03% equivalent to Baht 2.8 Million but less than 3% equivalent to Baht 276 Million. The value of transaction is not required the shareholders' meeting approval. 8.4) Business Intelligence System (BI), Service Agreement pursuant to the following details: 8.4.1) Date of transaction : 19 September 2005 Term of agreement : 1 year, to be renewed on yearly basis Service Provider : Makro Asia Management (MAM) Service Receiver : Siam Makro Plc. (SML) 8.4.2) Type of transaction : Provide the BI system service and maintenance including the report design to achieve business objective. 8.4.3) Total Value of : EUR 95,032 (approximately Baht 4.9 Service Fee million). SML has to absorb all taxes incurred in relations to payment. 8.4.4) Nature and scope of : MAM is a company of SHV group, interest of connected a major shareholder of SML holding persons directly and indirectly SML shares over 10%. 8.4.5) Company's justification : BI Project involved the utilization of new software and related hardware via the Company's computer system of the head office and all stores to increase efficiency on the Company's information management. 8.4.6) Interested Directors : (1) Mr. Francisco Henrique Passos and/or Directors being Fernandes connected persons not (2) Mr. Antonio Carlos Pereira Melo attending the meeting nor having the right to vote Estimated expenses for the : Baht 4,900,000 year 2005 As at 30 June 2005, the net tangible assets according to the Company's consolidated financial statement is Baht 9,186 Million. Consequently, (more)