Related Parties Transactions Entered Into By The Company

Necessary and Reason of Transaction

The connected transactions were continuations of financial assistance
for the Company’s working capital. Terms and conditions of transaction
benefit the Company. For example, the Company pays interest charges
directly to a bank at the rate charged by the bank and if the Company
pays directly to the lender, the Company will pay interest at the same
rate as render borrowing rate without charge.

The transactions were re-approved by the Company’s Board of Director,
and reported to the Stock Exchange of Thailand (SET) following SET’s
regulations of connected transaction disclosure.

Policy of Connected Transaction Approval

The Company minimizes or avoids further financial assistance from
connected and/or related parties. The transactions below provide the
Company with credit facilities in case of unplanned working capital
shortages to meet immediate financial commitments. Upon entering such
transactions, controls are in effect pursuant to the Board of Director’s
resolution (meeting No. 2/2009, February 26, 2009) stating as follow:

On receiving or granting finance assistance transactions between related parties, do as follows concerning amounts and procedures for each transaction (Note:(1):

A) Between THB 1 M and THB 20 M; notify the SET immediately and obtain
approval from the BOD.

B)THB 20 M(approximately USD 0.57 M) or more; notify the SET
immediately, and obtain approval from the BOD and shareholders.

On purchasing goods or services, or entering into any kind of contracts or agreements, such as purchase, service, joint venture, or agent contract etc. do as follows concerning amounts and procedures (Note: (2):

C) Between THB 1 M. and THB 20 M (approximately USD28,000 to USD 0.57
M.); notify the SET immediately. Also, BOD approval may be needed in
certain cases, such as in transactions where the terms are not normal
commercial terms(except in the lease of immovable assets where the lease
period is not over 3 years), or in an asset/ service transaction.

D) THB 20 M (approximately USD 0.57 M) or more;notify the SET
immediatelyandobtain approval from BOD. Also, shareholders’ approval may
be needed in certain transactions such as in cases where the terms are
not normal commercial terms, or in an asset/ service transaction.

(1) The amount is referred to in the financial statement and/or SET or
SEC’s announcement and can be changed as appropriate.

(2)There is no need to inform or send the reports as mentioned above to
the secretary if the transaction is an ordinary and normal business
transaction with normal commercial term e.g. purchase of raw materials,
purchase of supplies used in processing, purchase-selling inventories.
However, if the transaction is done between the related parties, normal
commercial terms have to be applied, otherwise the procedure- as in C)
or D) above, must be applied regardless of the value involved.

In the latter case, any involved parties must abstain from voting on the
transaction(s); and said transaction(s) must be scrutinized by the Audit
Committee and reported to the SET pursuant to SET regulations relating
to the disclosure of related parties transactions.

Connected Parties

+----------------+------------------------+----------------------------+
| Tungkum        | Sintana Holdings       | Authong Enterprises        |
| Limited (TKL)  | Limited (SHL)          | Limited (AEL)              |
+================+========================+============================+
|   Transaction  |   SHL advanced to TKL  |   AEL provides services to |
|   Type         |   short-term for       |   TKL as follow:           |
|                |   woking capital of    |                            |
|                |   gold mining          | (1) To support TKL’s       |
|                |   operations in 2009.  |     geological and back-up |
|                |   It was formalised as |     for exploration        |
|                |   a long term loan in  |                            |
|                |   February 2010 and    | (1) To advise on the plant |
|                |   both parties agreed  |     processing facilities  |
|                |   to roll-over the     |     and expansion plans,   |
|                |   outstanding amount   |     hedging the companies’ |
|                |   in November 2010.    |     production and foreign |
|                |                        |     currency               |
|                |                        |                            |
|                |                        | (2) To introduce sources   |
|                |                        |     of overseas and local  |
|                |                        |     project financing and  |
|                |                        |     funding.               |
|                |                        |                            |
|                |                        | (3) To help sourcing on    |
|                |                        |     suppliers i.e. for     |
|                |                        |     purchase of chemical   |
|                |                        |     products, and          |
|                |                        |     construction companies |
|                |                        |     for the site           |
|                |                        |     preparation work.      |
|                |                        |                            |
|                |                        | (4) To help expediting     |
|                |                        |     approval of TKL’s      |
|                |                        |     applications for       |
|                |                        |     mining leases at each  |
|                |                        |     stage.                 |
|                |                        |                            |
|                |                        | (5) To introduce new       |
|                |                        |     investors to TKL for   |
|                |                        |     equity participation.  |
|                |                        |                            |
|                |                        |   TKL pays monthly consult |
|                |                        |   service fee to AEL       |
+----------------+------------------------+----------------------------+
|   Transaction  |   The outstanding      |   Services fee for year    |
|   Value &      |   balance of short     |   2009 as follow:          |
|   Criteria on  |   term loan as at      |                            |
|   Net Tangible |   November, 2010       | (1) Management fee Baht    |
|   Assets       |   amount Baht 67.8     |     4.68 million (monthly  |
|                |   million              |     Baht 390,000)          |
|                |                        |                            |
|                |                        | (1) Car Rental Baht 1.20   |
|                |                        |     million (monthly Baht  |
|                |                        |     100,000)               |
|                |                        |                            |
|                |                        | (2) House Allowance Baht   |
|                |                        |     0.696 million (monthly |
|                |                        |     Baht 58,000)           |
|                |                        |                            |
|                |                        |   Total Baht 6.576 million |
|                |                        |   (monthly Baht 548,000)   |
|                |                        |                            |
|                |                        |   This value represents    |
|                |                        |   less than 3% of the      |
|                |                        |   latest audited (30 June  |
|                |                        |   2008) net tangible       |
|                |                        |   assets of THL as per the |
|                |                        |   Stock Exchange of        |
|                |                        |   Thailand (SET)’s         |
|                |                        |   regulation (ref: BorJor: |
|                |                        |   52-2-01, clause 9 (1)    |
|                |                        |   and (2), page 122). The  |
|                |                        |   Transaction Value        |
|                |                        |   divided by THL’s Net     |
|                |                        |   Tangible Assets derives  |
|                |                        |   a percentage of 0.66%.   |
|                |                        |                            |
|                |                        |   AEL started service to   |
|                |                        |   TKL since August 1,      |
|                |                        |   2008.                    |
+----------------+------------------------+----------------------------+
|   Reason for   |   To extend the        |   Before that, SHL         |
|   Transaction  |   financial assistance |   provided service to TKL  |
|                |   rendered in support  |                            |
|                |   of THL group’s       |   Then, THL and TKL agreed |
|                |   working capital.     |   to have AEL replace SHL  |
|                |                        |   position in order to     |
|                |                        |   reduce the conflict of   |
|                |                        |   interest                 |
|                |                        |                            |
|                |                        |   The term and condition   |
|                |                        |   of the service fees was  |
|                |                        |   reasonable based on      |
|                |                        |   appropriateness and      |
|                |                        |   fairness.                |
+----------------+------------------------+----------------------------+
| Terms and      |   1) The roll-over was |                            |
| Conditions of  |   to maintain working  |                            |
| Transaction    |   capital for THL      |                            |
|                |   group.               |                            |
|                |                        |                            |
|                |   2) THL rolled-over   |                            |
|                |   the loan at 15%      |                            |
|                |   interest and 3% fee  |                            |
|                |   charge.              |                            |
|                |                        |                            |
|                |   3) First pledge on   |                            |
|                |   shares of Sea        |                            |
|                |   Minerals Ltd. Book   |                            |
|                |   value THB 18.5 m     |                            |
|                |                        |                            |
|                |   Second Pledge on     |                            |
|                |   THL’s property in    |                            |
|                |   Phuket.              |                            |
|                |                        |                            |
|                |   The interest rate is |                            |
|                |   based on the level   |                            |
|                |   of collateral and    |                            |
|                |   lax repayment        |                            |
|                |   schedule (no         |                            |
|                |   schedule for         |                            |
|                |   interest and         |                            |
|                |   principal            |                            |
|                |   repayment).          |                            |
+----------------+------------------------+----------------------------+
|   Scope of     |   SHL is major         |   Mr. R. Ng Wai Choi is a  |
|   Connected    |   shareholder of THL.  |   Managing Director and    |
|   Persons/     |                        |   shareholder of THL but   |
|                |   Mr. John Yang Pichit |   does neither hold shares |
|  Relationships |   was THL’s            |   nor being a director in  |
|                |   shareholder and      |   AEL. However, he has     |
|                |   directors of both    |   controlled the TKL’s     |
|                |   THL and SHL at the   |   management (THL hold     |
|                |   time of the          |   shares 98.86% in TKL)    |
|                |   transaction.         |   and TKL pay AEL for the  |
|                |                        |   consultancy fee, and AEL |
|                |   Per THL policy,      |   pay the consultancy fees |
|                |   these persons        |   to him. Thus he is a     |
|                |   abstained from       |   related person who       |
|                |   voting in connection |   benefits from this       |
|                |   with this            |   transaction.             |
|                |   transaction.         |                            |
+----------------+------------------------+----------------------------+
|   Transaction  |   This transaction was |   This transaction was     |
|   T            |   reported in THL’s    |   reported in THL’s annual |
| ransparencyand |   annual and quaterly  |   and quaterly financial   |
|   approval     |   financial statements |   statements and submitted |
|   process      |   and submitted        |   quarterly to the SET.    |
|                |   quarterly to the     |   This transaction was     |
|                |   SET. This            |   reviewed by an external  |
|                |   transaction was      |   auditor, legal counsel,  |
|                |   reviewed by an       |   THL’s Audit Committee,   |
|                |   external auditor,    |   and Board of Directors   |
|                |   legal counsel, THL’s |   who deemed the said      |
|                |   Audit Committee, and |   transaction to be fair,  |
|                |   Board of Directors   |   reasonable, and in       |
|                |   who deemed the said  |   compliance with          |
|                |   transaction to be    |   generally acceptable     |
|                |   fair, reasonable,    |   accounting procedures.   |
|                |   and in compliance    |                            |
|                |   with generally       |                            |
|                |   acceptable           |                            |
|                |   accounting           |                            |
|                |   procedures.          |                            |
+----------------+------------------------+----------------------------+

ONNECTED TRANSACTIONS WITHIN THE GROUP

Regular Commercial or Business-Supporting Items

During the year, the following significant transactions were engaged in
the normal course of business:

Property Leases

  -------------- -------------- ------------- ------------- ---------------
  Subsidiaries   Tungkum        Cholsin       Sky Cliff     Sea Minerals
                 Limited        Limited       Limited       Limited

  Rental Income  1,200,000.00   660,000.00    0.00          60,000.00
  (Baht)                                                    
  -------------- -------------- ------------- ------------- ---------------

The rates for such space leases were compatible with market rates.

Financial Assistance to Subsidiaries

The transactions within the Group relate mainly to inter-company loans
from TongkahHarbour Public Company Limited to the subsidiaries. The
terms of agreement between the parent entity and the subsidiaries are
mainly as follows:

Transaction type : Long term loan

Reason for loan : To provide long term capital for the subsidiary’s
projects.

Terms : Interest charged on the average banking interest cost.

Disclosure : Reported to the SET and shareholders, quarterly and

  annually as incurred.

Approval Process : Reviewed by auditors, legal counsel, TongkahHarbour
Public Company Limited’s Audit Committee and Board of Directors who
deemed said transaction to be fair, reasonable, and in compliance with
generally acceptable accounting procedures.

+-----------+-------------+--------------+-------------+--------------+
| Company   | Tungkum     | Cholsin      | Sky Cliff   | Sea Minerals |
| Name      | Limited     | Limited      | Limited     | Limited      |
|           | (TKL)       | (CSL)        | (SCL)       | (SML)        |
+-----------+-------------+--------------+-------------+--------------+
|           |   Baht      |   Baht       |   Baht      |   Baht       |
|  Balances |   2         |   8          |   145       |   (21        |
|           | ,544,368.77 | 9,624,929.00 | ,615,421.98 | ,737,269.77) |
|   31 Dec  |             |              |             |              |
|   2009    |   Baht      |   Baht       |   Baht      |   Baht       |
|           |   1         |   4          |   27        |   (1         |
|           | ,279,699.36 | 5,313,695.47 | ,073,792.08 | ,523,737.14) |
| Principal |             |              |             |              |
|   due     |             |              |             |              |
|   from    |             |              |             |              |
|   (due    |             |              |             |              |
|   to)     |             |              |             |              |
|           |             |              |             |              |
|   Acc.    |             |              |             |              |
|           |             |              |             |              |
|  Interest |             |              |             |              |
|           |             |              |             |              |
|   R       |             |              |             |              |
| eceivable |             |              |             |              |
|           |             |              |             |              |
| (payable) |             |              |             |              |
+-----------+-------------+--------------+-------------+--------------+
|           |   0.00      |   Baht       |   0.00      |   0.00       |
| Provision |             |   10         |             |              |
|           |             | 8,982,006.47 |             |              |
+-----------+-------------+--------------+-------------+--------------+
|   Scope   |   Share     |   Share      |   Share     |   Share      |
|   of      |   holders   |   holders    |   holders   |   holders    |
|           |   98.86%    |   72.10%     |   75.00%    |   99.99%     |
| Connected |             |              |             |              |
|           |   Joint     |   Joint      |   Joint     |   Joint      |
|  Persons/ |   directors |   directors  |   directors |   directors  |
|   Relat   |   and       |   and        |   and       |   and        |
| ion-ships |   s         |              |   s         |              |
|           | hareholders | shareholders | hareholders | shareholders |
+-----------+-------------+--------------+-------------+--------------+

Future of Connected Transactions

The Company operates business based on Company benefit. Connected
transactions with related companies or parties (financial assistance)
will occur in significant circumstance. In future, the Company has no
intent to do connected transactions, except where the Company encounters
severe circumstances. However, the Company follows the policy of
connected transaction approval as stated in clause 2.11.2 In addition,
the Company will report connected transactions to SET.