2.9 Management

(1) Management Structure

  The company had established various boards, namely the Board of
  Directors, Board of Executive Directors and Audit Committee to assist
  in its policy setting, controlling and managing toward the company’s
  goals and direction. Moreover, various committees had also been
  established to assist the Board of Executive Directors in providing
  useful data necessary for the Board’s policy revision, details of
  which are as follows:

  A. Board of Directors

  In the year 2005, the Board of Directors consisted of the following
  members (Please also see remarks) :

  1. Mr.Vitoon Wongkusolkit Chairman of the Board

  2. Mr.Wichien Wattanakun Independent Director / Chairman of Audit
  Committee

  3. Mr. Chokechai Tanpoonsinthana Independent Director / Audit
  Committee member

  4. .Mr. Chongrak Sripunporn Independent Director / Audit Committee
  member

  5. Mr.Vorapol Socatiyanurak Independent Director

  6. Mr.Kulvat Janvatanavit Director / Chairman of the Executive Board

  7. Mrs.Wilaiwan Tantitham Director / Vice Chairman of the Executive
  Board

  8. Mr.Verajet Vongkusolkit Director / Executive Director

9. MissTippranee Chatmanop Director / Executive Director

10. Miss Sudthida Chirapatsakul * Director / Executive Director

The company’s secretary to the Board is Ms. Siriphen Pongchairerks.

Remarks : * During the year, there were 2 Directors appointed namely,
Mr. Jirayuth Rungsrithong and Miss Sudthida Chirapatsakul while there
were 2 Directors resigned, namely Mrs.Sasitorn Phongsathorn and
Mr.Jirayuth Rungsrithong.

Additional Remark: As there was a change in major shareholder of the
company from Wongkusolkit group to APF Holdings Co., Ltd., there were
some Directors resigned and a replacement of Directors, details as
follows:

The resigned directors are:

1.  Mr. Vitoon Wongkusolkit replaced by Mr. Mitsuji Konoshita to be
    Chairman of The Board

2.  Mr. Verajet Vongkusolkit replaced by Mr. Osamu Shigematsu to be
    Director (without power of management)

3.  Mr.Kulvat Janvatanavit replaced by Mr. Jeremy Liau to be Director
    (with power of management, Managing Director and Executive Director

4.  Mrs.Wilaiwan Tantitham replaced by Mr.Tatsuya Konoshita to be
    Director (with power of management) and Chairman of the Executive
    Board

  Which were to be effective on 1 March 2006 or the date that the Office
  of the Securities and Exchange Commission approves the new directors
  which ever is the earlier.

The Authorized Directors

As at 31 December, 2005, the authorized signer Directors consisted of
Mrs.Wilaiwan Tantitham, Mr.Kulvat Janvatanavit, Ms.Tippranee Chantmanop
and Ms. Sudthida Chirapatsakul on the condition of 2 out of the 4
directors co-sign with the company seal.

Remark : After the new Directors had been approved by SEC and registered
by MOC, the new authorized signatory of the Company will appear as
follows:

“Mr. Tatsuya Konoshita and Mr. Jeremy Liau jointly sign with the Company
seal or either Mr. Tatsuya Konoshita or Mr. Jeremy Liau jointly sign
with Ms. Sudthida Chirapatsakul or Ms. Tippranee Chatmanop with the
Company seal.”

The Directors’ Authorities and Responsibilities

The Company has assigned additional authorities and responsibilities of
the Directors other than those generally written in the Public Company
Act B.E.2535 and was included in the Company’s Articles of Association
No.24 which details are given below:

-   To carry out the duties in compliance with the laws, the Company’s
    objectives and the Company’s Articles of Association as well as the
    shareholders’ resolutions which are lawful.

-   To determine the Company’s objectives, directions, policies, plans
    and budget. To supervise the management of the Company’s Executive
    Board to be in accordance with the assigned policy except for the
    following activities which require the resolutions from the
    shareholders: Capital increase or decrease, issuing of debenture,
    the purchasing or selling or transferring of Company’s business or
    the transferee of other business or the merging with other business,
    the amendment of the Memorandum & Articles of Association and the
    remuneration of the Directors.

-   The Board of Directors may appoint some of the directors to become
    members of the Board of Executive Directors by granting the
    authority to supervise the Company’s business as assigned and out of
    these members one member will be appointed to be a Chairman of the
    Executive Board.

B.  The Board of Executive Directors

  As of 31 December 2005, the Company’s Board of Executive Directors
  consisted of 5 members as follow :

  1. Mr.Kulvat Janvatanavit Chairman of the Executive Board

  2. Mrs.Wilaiwan Tantitham Vice Chairman of the Executive Board

  3. Mr.Verajet Vongkusolkit Executive Director

  4. Ms. Tippranee Chatmanop Executive Director

  5. Ms.Sudthida Chirapatsakul * Executive Director

Remark * appointed during the year and there were 2 Directors resigned,
Mrs.Sasitorn Phongsathorn and Mr.Jirayuth Rungsrithong. (Please see
additional remarks under “Board of Directors” Section)

The Board of Executive Directors’ Authority and Responsibilities 

1. To screen and submit to the Board of Directors for approval on the Company’s yearly budget allocations as proposed by the management. This includes the authority to approve the changing or increasing in the yearly budget expenditure but the changing will finally be submitted to the Board of Directors for acknowledgement in the next meeting.

2.  To approve the expenses which is above the approval limit granted to
    the President and Managing Director and to be able to determine the
    President and Managing Director’s expenditure’s limit.

3.  To approve the significant investment fund which are already
    inclusive in the approved yearly budget or those generally agreed
    upon by the Board of Directors.

4. To approve the customers’ account opening for securities trading and
other related activities in concern and able to authorize other person
to do so under its scope of authority.

5. To approve the credit line for the company’s trading party on debt
instrument trading not exceeding 100 million Baht.

6.  To approve on the investment policy concerning business expansion as
    well as the merger plan with other company and which to be proposed
    to the Board of Directors Meeting for considerations on the next
    meeting.

7. To approve the appointment of the authorized signers of the Company’s
cheques or other financial documents as well as the signing of other
documents on shares, debenture, contracts, accounting / financial
documents and other general documents

8. To act as a consultant to the management concerning the Financial,
Marketing, Personnel Policies and any other activities.

9. To allocate the reward or bonus which amounts are already agreed upon
by the Board of Directors to the company’s employees or workers or to
other personnel in return for their performances. 10To approve the
promotion, transfer or lay off of the employees under management level
up to First Executive Vice President level.

Nevertheless, the above authorization should be exercised within the
Board of Directors’ approval and the Board of Executive Directors should
not involve in the approval of those matters which have personal
conflict of interest either to the company or its subsidiary and each
member has to disclose such items, if any, to the Board of Directors for
consideration.

Any matters other than those mentioned above should not be done by the
Board of Executive Directors except under prior consent or the
authorization from the Board of Directors’ decision on a case-by-case
basis.

In order to assist the Executive Board, the Board of Directors had
resolved to set up various sub-committees and for the year 2005, there
were some adjustments. Risk Control Committee which consisted of Credit
Committee and ECM Committee were substituted by Risk Management
Committee. IT Committee was newly set up while Investment Committee had
scaled down its activities as there had been a policy to decline the
company’s investment for the company’s portfolio since mid 2005. The
rest committees still remain, details of which are as follows:

1.  Risk Management Committee : has the following responsibilities :

    1.  Review and determine risk management policies governing :

    -   Securities business

    -   Investment Banking business

    -   Derivatives business

    2.  Report on various possible threatening risks to be considered by
        the Executive Board.

  Risk Management Committee consists of :

  President Chairman of the Committee Managing Director Committee

  Head of Back Office Departments Committee

  Head of Investment Banking Department Committee

  Heads of Research Division Committee

  Head of Accounting & Finance Department Committee

  Head of Risk Management Department Committee and Secretary

2.  Human Resources Committee: has the following responsibilities:

1.  To determine directions, policies and systems regarding human
    resources management as follows:

  - Recruitment system

  - Job level & position management

  - Compensation, rewarding based on performance

  - Welfare & benefit management

2.  To determine directions, policies and systems regarding human
    resources management

3.  To determine directions, policies and systems regarding performance
    management that correspond to corporate goals and action plans

4.  To comment or suggest new guidelines of human resources development
    and management system to the Executive Board

  Human Resources Committee consists of

  President Chairman of the Committee

  Vice Chairman of the Executive Board Committee

  Managing Director Committee

  Head of Human Resources Department Committee and Secretary

3. Back Office Committee has the following responsibilities :

1.  To determine directions, policies and systems regarding back office
    management and administration

2.  To review and determine regulations and procedures for supporting
    departments by ensuring that they will be consistent with new rules
    and/or transactions

3.  To reassess regulations in order to accommodate customer services
    where they must also correspond with the Company’s policies and the
    authorities’ rules and regulations

4.  To coordinate with relevant agencies for information and data so
    that the Company can provide comprehensive and accurate services to
    customers

  Back Office Committee consists of :

  Head of Back Office Departments Chairman of the committee

  President Committee

  Managing Director Committee

  Head of Accounting & finance Department Committee

  Head of IT Department Committee

  Head of Compliance & Internal Audit Dept. Committee

  Head of Operations Department Committee & Secretary

  4. IT Committee has the following responsibilities :

  - To consider or initiate IT Projects supporting the Company’s
  operations in order to be able to compete with other securities
  companies in its various businesses.

  IT Committee consists of :

  Vice Chairman of the Executive Board Advisor

  Managing Director Chairman of the Committee

  Head of Back Office Departments Committee

  Head of IT Department Committee

  Head of Marketing 5 Department Committee

  Head of Marketing 6 Department Committee

  Two IT Department staffs Committee

  E-Trade Department staff Committee

C. Audit Committee consists of the following members :

  1. Mr.Wichien Wattanakun Chairman of the Audit Committee

  2. Mr. Chongrak Sripunporn Audit Committee member

  3. Mr. Chokechai Tanpoonsinthana Audit Committee member

 Mr. Theerapong Tangchatthong, Vice President – Compliance & Internal Audit Department, is the Secretary to the Audit Committee.

The Authority and Responsibilities of the Audit committee

1.  To audit in order to ensure that the Financial Statements, quarterly
    as well as annually of the company are correct and adequately
    disclosed. The Audit Committee may suggest the Auditor to audit in
    particular areas which considered to be significant during the
    Auditor’s auditing period.

2.  To audit in order to ensure that the company possesses a suitable
    and efficient internal control system by co-auditing with the
    external and internal Auditors and make the evaluation at least
    twice a year.

3.  To audit in order to ensure that every activity of the company is
    legally in compliance with the rules and regulations set forth in
    the Securities and Exchange Act or other Acts in relation to the
    company’s business.

4.  To select the company’s external Auditor and propose for further
    appointment and to determine its remunerations in terms of its
    credibility, adequacy of personnel and the amount of work to be done
    as well as the past experience of the auditing team who will be put
    in charge of the company’s auditing.

5.  To ensure that the company has fully and accurately disclosed any
    connected transactions or any other transactions which may have some
    conflicts of interest.

6.  To carry out any other missions assigned by the Board of Directors
    of which is also agreed upon by the Audit Committee, for example, to
    revise the financial management and risk management policies, to
    evaluate and make sure that the management has followed the Code of
    Ethics and to co-examine with the company’s management the
    correctness of the significant reports which have to be legally
    disclosed to the public, such as the report and analysis from the
    management.

7.  To prepare the report pertaining the various activities of the Audit
    Committee in order to be included in the company’s Annual Report
    such report has to be initial by the chairman of the Audit Committee
    and should contain the following details:

-   Comments on the correctness and competence of the composing
    procedure and the disclosure of the financial data

-   Comments on the sufficiency of the internal control system of the
    company

-   Reasons to support the re-appointment of the company’s external
    Auditor for another term.

-   Comments on the company’s compliance to the Securities Exchange Act
    as well as the rules and regulations from the SET and other related
    securities laws.

-   Other necessary reports which the shareholders and the general
    public are supposed to know under the duties and responsibilities
    assigned by the Board of Directors.

8.  To propose the remunerations policy of the Board of Directors and
    the Company’s top management.

9.  To perform any other duties assigned by the Board of Directors
    within the scope of duties and responsibilities of the Audit
    Committee.

  D. The Management as of 31 December, 2005 consists of the followings :

  ----- ----------------------- ------------------------------------------
  1.    Mr.Kulvat Janvatanavit  Chairman of the Executive Board

  2.    Mrs.Wilaiwan Tantitham  Vice Chairman of the Executive Board

  3.    Miss Sudthida           Managing Director and Acting EVP –
        Chirapatsakul *         Marketing 4

  4.    MissTippranee Chatmanop Senior Executive Vice President – Back
                                Office Departments

  5.    Mr. Yothin Viriyeanawat Executive Vice President – Marketing 1

  6.    Mrs.Suwanna Sunkameka   First Executive Vice President – Marketing
                                2

  7.    Mr.Porntep              First Executive Vice President – Marketing
        Tavornvisuthikul        2

  8.    Mr. Phitsanu Pattanopas Executive Vice President – Marketing 2
        *                       

  9.    Mrs.Sumitra Srisawad    Executive Vice President – Marketing 3

  10.   Mr. Kittikul Suporn *   Executive Vice President – Marketing 5

  11.   Mr. Somchai Teeratham * Executive Vice President – Marketing 6

  12.   Mr. Namchai             Executive Vice President – Research
        Techaratanawiroj        

  13.   Mrs.Thunchanok          Vice President-Accounting and Finance
        Laksameset              
  ----- ----------------------- ------------------------------------------

Remarks * Appointed during the year

  - Resigned during the year : Mrs.Sasitorn Phongsathorn - President

Mr.Jirayuth Rungsrithong - Managing Director

Mr.Nitipong Tejavanija and Mr.Vararatana Jutimitra, EVPs. – Investment
Banking

(2) Nomination of directors and executives

For the time being, the Company has not officially set up its Nomination
Committee and therefore has not assigned any particular directors to
handle the nominating function. However, in practice, every director can
help recruiting sound candidates by nominating them to the Board of
Directors for further consideration and selection. This refers to
positions of directors, members of the Audit Committee and senior
executives such as Chief Executive Officer where candidates will be
proposed and seek approval from the Board of Directors’ Meeting or the
Shareholders’ Meeting, as the case may be. It is however the duty of
executive directors to nominate the candidates positions lower than CEO.
Potential candidates can be either internal staff (through promotion) or
outsiders, whose names will be submitted to the Executive Board of
Directors’ Meeting for selection and for further approval by the
Company’s Board of Directors.

(3) Management Remunerations

A.  Remunerations in monetary terms for the year ended 31 December 2005

-Board of Directors: Monetary remunerations of the Board of Directors
consist of meeting allowances of the Board of Directors, the Audit
Committee and non-employee executive directors as well as gratuity for
directors and non-employee executive directors, details of which are as
follows.

+------------------+-------------------+---------+---------+----------+
| Name             | Position          | Annual  |         | Total    |
|                  |                   | Remune  |         |          |
|                  |                   | rations |         |          |
+------------------+-------------------+---------+---------+----------+
|                  |                   | Meeting | G       | Remun    |
|                  |                   | al      | ratuity | erations |
|                  |                   | lowance |         |          |
|                  |                   |         |         | per year |
+------------------+-------------------+---------+---------+----------+
| 1. Mr.Vit        | Chai              |         | 125,000 | 425,000  |
| oon Wongkusolkit | rman of the Board | 300,000 |         |          |
+------------------+-------------------+---------+---------+----------+
| 2. Mr. Wi        | Independent Dire  | 480,000 | 100,000 | 850,000  |
| chien Wattanakun | ctor / Chairman o |         |         |          |
|                  | f Audit Committee |         |         |          |
+------------------+-------------------+---------+---------+----------+
| 3. Mr.Vera       | Director /        | 360,000 | 200,000 | 560,000  |
| jet Vongkusolkit |  Executive Direct |         |         |          |
|                  | or (non-employee) |         |         |          |
+------------------+-------------------+---------+---------+----------+
| 4. Mr.Vorap      | Inde              | 240,000 | 100,000 | 340,000  |
| ol Socatiyanurak | pendent Director  |         |         |          |
+------------------+-------------------+---------+---------+----------+
| 5. Mr.Kul        | Director          | 240,000 | -       | 240,000  |
| vat Janvatanavit |  / Chairman of th |         |         |          |
|                  | e Executive Board |         |         |          |
+------------------+-------------------+---------+---------+----------+
| 6. Mrs.Wi        | Director / Vi     | 240,000 | -       | 240,000  |
| laiwan Tantitham | ce Chairman of th |         |         |          |
|                  | e Executive Board |         |         |          |
+------------------+-------------------+---------+---------+----------+
| 7 .Ms.Tip        | Director / E      | 240,000 | -       | 240,000  |
| pranee Chatmanop | xecutive Director |         |         |          |
+------------------+-------------------+---------+---------+----------+
| 8. Mr.Cho        | Independent       | 420,000 | 100,000 | 520,000  |
| ngrak Sripunporn |  Director / Audit |         |         |          |
|                  |  Committee member |         |         |          |
+------------------+-------------------+---------+---------+----------+
| 9. Mr.Chokechai  | Independent       | 420,000 | 100,000 | 520,000  |
|  Tanpoonsinthana | Director / Audit  |         |         |          |
|                  | Committee member  |         |         |          |
+------------------+-------------------+---------+---------+----------+
| 10. Mrs.Sasitor  | Director / E      | 100,000 | -       | 100,000  |
| n Phongsathorn * | xecutive Director |         |         |          |
+------------------+-------------------+---------+---------+----------+
| 11. Mr.Rachai    | Director          | 20,000  | -       | 20,000   |
|  Wattanakasaem * |                   |         |         |          |
+------------------+-------------------+---------+---------+----------+
| 12. Mr.Jirayuth  | Director / E      | 180,000 | -       | 180,000  |
|                  | xecutive Director |         |         |          |
| R                |                   |         |         |          |
| ungsrithong ** * |                   |         |         |          |
+------------------+-------------------+---------+---------+----------+
| 13. Ms.Sudthida  | Director / E      | 160,000 | -       | 160,000  |
| Chirapatsakul ** | xecutive Director |         |         |          |
+------------------+-------------------+---------+---------+----------+
|  Tot             |                   | 3,      | 725,000 | 4        |
| al Remunerations |                   | 400,000 |         | ,125,000 |
+------------------+-------------------+---------+---------+----------+

  Remark * resigned during the year ** joined in during the year

  (Please see more detail about remunerations under (4) Corporate
  Governance no. 10)

-Executives: Monetary remunerations of its executives in a form of
salaries and bonuses were given to 16 executives; namely, the first four
rankings of executives following the President, excluding Accounting and
Finance head, for a total of Baht 39.4 million.

B.  Other remunerations

1.  Contributions to the Provident Fund: The Company paid a total of
    Baht 1.03 million worth of contributions into the provident fund for
    its 16 executives in 2005.

2.  Insurance given to directors and senior executives: The Company
    bought Baht 50 million worth of insurance from Muang Thai Insurance
    Co., Ltd. to provide malpractice coverage for its directors and/or
    executives.

3.  ESOP: Starting in 2002, the Company has allocated share warrants to
    its directors and those of its subsidiaries as well as executives
    where directors are equally allocated 80,000 shares while executives
    and employees received them according to the number of years in
    service with the Company. However, since 3 October, 2005 was US-W1
    maturity date, all of the warrants were converted into common shares
    (US) and therefore, the details tabled below had stated only the
    holding of ordinary shares. (Only eligible persons are stated).

Shareholdings of the Board of Directors and Management

As at 31 December, 2005

+----------------------------------------------+------------------------+
| Name                                         | Ordinary Shares        |
|                                              | (units)                |
+----------------------------------------------+------------------------+
| Directors                                    | 7,061,950              |
|                                              |                        |
| 1. Mr. Vitoon Wongkusolkit                   |                        |
+----------------------------------------------+------------------------+
| 2. Mr. Wichien Wattanakun                    | 80,000                 |
+----------------------------------------------+------------------------+
| 3. Mr. Vorapol Socatiyanurak                 | -                      |
+----------------------------------------------+------------------------+
| 4. Mr. Verajet Vongkusolkit                  | 123,427                |
+----------------------------------------------+------------------------+
| 5. Mr. Kulvat Janvatanavit                   | 168,200                |
+----------------------------------------------+------------------------+
| 6. Mrs. Wilaiwan Tantitham                   | 33,192                 |
+----------------------------------------------+------------------------+
| 7. Ms. Tippranee Chatmanop                   | 40,500                 |
+----------------------------------------------+------------------------+
| Executives                                   | -                      |
|                                              |                        |
| 1. Mrs. Suwanna Sungkameka                   |                        |
+----------------------------------------------+------------------------+
| 2. Mr. Pornthep Tavornvisuthikul             | -                      |
+----------------------------------------------+------------------------+
| 3. Mr. Yothin Viriyenawat                    | -                      |
+----------------------------------------------+------------------------+
| 4. Mrs. Thunchanok Luxameseth                | 10,150                 |
+----------------------------------------------+------------------------+

Remark : The ESOP Warrants had all been converted into common shares
(US) for the last time since 3 Oct. 05 – its maturity date, therefore,
the above information consists only ordinary shareholding of each
person.

  (4) Corporate Governance

As the Company is one of the listed companies, we realize that it is the
Company’s responsibility to be transparent and to give the utmost
benefit to the shareholders and the general investors as a whole. The
Company endeavors to adhere to the Stock Exchange of Thailand’s 15
Principles of Good Corporate Governance as follows:

1. Compliance Policy

The Board of Directors realizes the importance of the Company to have
good governance to maintain the Company’s consistent and constant growth
to bring about its efficiency and transparency which will build up trust
to all concerns. The Company has developed Compliance Policy which
focuses on the following areas:

1.  Protect the rights and benefits of the shareholders as well as the
    related concerns.

2.  Guide the management to set up operations strategies according to
    the Board’s vision and suitable for the current situation under
    proper risk and internal control system through regular monthly
    meetings.

3.  Appoint the Audit Committee who is also the Independent Director to
    evaluate and propose the remunerations of the Directors and
    Executive Directors so that it is fair and transparent and prevented
    from any conflict of interest. However, the proposed remunerations
    will have to be approved by the shareholders in the AGM.

4.  Directors, Management and staff are bound to follow the Company’s
    compliance policy and the code of ethics of the Company.

5.  Set up internal control system both in terms of financial and
    operational areas by the Management Internal Control Dept. which is
    an independent department under direct supervision of Executive
    Board.

6.  Ensure that the Company has disclosed all necessary information to
    the public correctly and in a timely manner.

In addition, the Company is currently formulating a good corporate
governance policy in its 2005 action plan as guideline for practice,
which will be announced later for further implementation.

2. Shareholders : Rights and Equitable Treatment

The Company realizes the importance of the shareholders’ reception of
information in terms of adequacy, timing and equitability in order to
make correct decision at each AGM and Extraordinary Meeting. Notices of
the meeting will be sent to the shareholders through Thailand Securities
Depository Co., Ltd., the Company’s registrar, about 10 days in advance.
Apart from date, place and time of the meeting, the meeting notice will
always include the agenda which will specify the details and opinions of
the Board of Directors so that the shareholders will have sufficient
information for their decision making for each agenda. In addition, the
meeting notice will be attached with other necessary documents such as
the previous minutes of the meeting to be certified, brief profile of
the appointed directors, the Company’s financial statement, etc. Proxy
Form B will also be attached so that the shareholders who cannot attend
the meeting themselves may grant their rights to others or to the
Company’s Independent Directors to come and vote for them at the meeting
according to their desired decision. Business returned envelop will also
be attached to facilitate the shareholders in sending the proxy back to
the Company without any cost. Moreover, the company also publicizes the
meeting notice in a daily newspaper for 3 consecutive days and 3 days
before the meeting takes place. The meeting notice is also made in
English language, too to facilitate those foreign shareholders.

3.  Rights of Stakeholders

The Company is aware of the rights of its stakeholders and sets up a
policy to encourage collaboration with stakeholders for mutual benefits
while ensuring that all groups of stakeholders are fairly and properly
treated. This starts from providing welfare to its employees and
executives as well as those of subsidiaries, which, aside from basic
welfare required by the law, includes health benefits, life insurance
and group health insurance, insurance for directors and senior
executives against malpractice, annual health check-up, provident fund
and annual retreat.

For external stakeholders such as shareholders, customers, suppliers,
competitors, lenders and other agencies, we pay a great attention to
legal compliance as well as business ethics of its executives and
employees. The Company is also member of the arbitration project
initiated by the Securities and Exchange Commission as well as the
securities investor protection fund.

In addition, as a member of the society, the Company has a policy to
support or engage in charitable activity at least once a year. In 2005,
together with its staff, the Company donated a sum of Bht.200,000 to
Rajprachanukroa Foundation to be forwarded to 6 southern provinces which
were the victims of Tsunami Disaster. Moreover, during the year the
Company donated a total of 34 PC computers to provincial schools in
Baankradan, Surin Province, and to 2 other provincial schools in Panga
and Nakornrajasrima. In addition, another 20 PCs were donated to Don Mod
Dang Local Police Station, the IT learning center for the local teachers
and students in Ampoe Don Mod Dang in Ubonrajathani Province.

4.  Shareholders’ Meeting

In 2005, there were altogether 2 shareholders’ meetings – one was the
Annual General Meeting and the other one was Extraordinary
shareholders’. On both meetings, the Company ensured that its procedures
to call a shareholders’ meeting were legally carried out, starting from
calling for the meeting, sending meeting materials and keeping minutes
of the meeting. In the invitation letter to attend the meeting, meeting
agendas were stipulated in details together with directors’ opinion in
each agenda plus enough supporting documents and proxy form B and
business return envelop so that the shareholders could be able to make
their votes even if they were not present in the meetings.

As for the last AGM, all directors had attended the meeting which
included Chairman, all independent directors, members of the Audit
Committee and all executive directors. Accounting and finance directors
and Chairman of all Committees and the Company’s auditors also attended
the meeting to clarify and answer shareholders’ inquiries. At the end of
each agenda, Chairman of the Meeting allowed shareholders to express
opinions and ask questions. Significant comments were recorded in the
minutes of the meeting.

5.  Leadership and Vision

Board of Directors has taken part in the setting up ( or approval of )
vision, mission, strategies, objectives, business plans and budget of
the Company and direct them towards the set goals effectively and
efficiently in order to financially add more value to the business and
to maximize benefits to the Shareholders as a whole. Moreover, the Board
of Directors always ensures that the Company has effective management
internal control and risk control system and includes the regular follow
ups in the Board meetings. And the Board of Directors also determines
and differentiates the roles, duties and responsibilities among the
different boards, committees and management (please see details in
Management Structure under No. 2.9) and ensures that each part
understands them correctly. Apart from that, the Board of Directors also
sees to it that the Executive Board always follows the set policies, for
instance, the Executive Board is authorized to approve for not exceeding
100 million Baht in securities business, to approve the expenses within
the budget excluding those connected transactions or those which have
some conflict of interest as well as the transaction which has to be
approved by the Shareholders under the rules from SET and SEC.

Realizing the importance of educating its directors, the Company has a
policy which encourages every director to attend at least one director’s
training course organized by the Thai Institute of Directors Association
(IOD).

6.  Conflict of Interest

The Conflict of Interest Transactions : The Board of Directors will be
informed of the conflict of interest transactions as well as the
connected transactions and always consider them with prudence and comply
to the SET rules so that prices and conditions were similarly charged to
the Company as to the normal customers. (details of which are disclosed
in the Company’s Annual Report and Form 56-1).

Supervision of Inside Information Usage : It was clearly stated in the
Compliance Manual and as the rules of the company concerning the policy
to protect the abuse of inside information for personal benefits.

The policy and regulations are as follows:

1.  The company requires that the employees open the securities trading
    account with the company only and has limited the period of making
    buying or selling orders to be during pre-open period only and such
    orders required a prior check and approval by the Compliance Unit to
    make sure that they are not in the restricted list before the orders
    can be executed. In addition, the employees have to disclose the
    trading of securities transactions of their spouses and/or minor
    children to the Compliance Unit on monthly basis in order to be
    transparent and fair.

2.  It is the company’s rules which applied to all employees, who may
    have more chance to know the inside information than the general
    public, not to make use of the information for personal benefits.
    The company will ensure that all employees realize and strictly
    follow this rule, the rule of standard practice.

3.  The Chinese Wall rule also applied in the company’s operations so
    that the employees are aware of the importance of keeping both the
    customers’ as well as the company’s secrets which is considered to
    be a method of preventing the abuse of inside information

4.  The rules concerning Watched list, Restricted List or Research list
    which are the lists of those securities that the company has the
    business involved in and should be restricted in various activities,
    e.g., the company’s portfolio investment, employees’ trading, the
    issuing of reports or research paper. And such lists are used as the
    information by the Compliance Unit in controlling of the abuse of
    inside information and the conflict of interest.

Each and every rule stated above should be complied by all employees and
they are considered to be an important policy which the Board of
Directors assigned the Compliance Unit to control and to report directly

to the Audit Committee. Any Management or employees found guilty of
violating the above rules will be subject to the company’s disciplinary
action.

3.  Business Ethics

In order to maintain an ethical business, the Company had issued a
written code of ethics so as to ensure that the Board of directors,
management and staff has done their duties on the basis of honesty,
transparency and accountability to the Company, the stakeholders, public
and the society as a whole. The said provisions was disclosed to all of
the management and staff of the Company who had signed in agreement and
acknowledgement and the supervisors have the duty not only to ensure
that their subordinates always comply to the rules but also act as a
good employee.

4.  Balance of Power for Non-executive Directors

In 2005, there were 10 directors consisting of

  - 4 executive directors

  - 2 non-executive directors

- 4 independent directors or more than one-third of all directors
whereby Chairman of the Board represents the shareholders, is a
non-executive director and is not the same person as the Chairman of the
Executive Board to assure that the Board can actively perform its duties
as shareholders’ representative and a balance of power is properly
exercised.

Independent Director Definition :

Independent director means non-executive director who shall neither
participate in regular management nor be the Company’s employee or a
person who controls the Company or its affiliates or who has any
relation with its auditor or legal counselor or is relative of the
Company’s executives or major shareholders and holds less than 5 per
cent of the Company’s total shares with voting rights.

5.  Aggregation or Segregation of Positions

Although Chairman of the Board of Directors represents major
shareholders, he is not the same person as Chairman of the Executive
Board or the managing director. This is where responsibilities to
determine supervision policies and to manage day-to-day operations are
clearly separated. More than one-third of the Company’s total directors
are independent directors, the structure which leads to proper balance
of power and fair performance review.

6.  Remunerations for Directors and the Management

Remunerations for Directors

Audit Committee is responsible to perform the duties of the
Remunerations Committee in determining the amount of remunerations to
the Directors, Chairman of the Executive Board, Executive Board members,
President and Managing Director so that it is comparable to the same
industry and sufficient to motivate and retain the qualified Directors
and appropriately for the financial status of the Company.

In 2005, the remuneration of the Board was the meeting fee which was
paid monthly. Chairman of the Board received Bt25,000 and other
directors Bt20,000 each per month. The Audit Committee Directors
received an additional amount for their additional mission. Chairman of
the Audit Committee received Bt20,000 and the other members received Bt
15,000 each. As for bonus, Chairman of the Board got Bt 125,000 and
Director got Bt 100,000 each. However, Directors’ remunerations will
always have to be approved by the shareholders in the AGM.

Remunerations for Executives

The remunerations policy is to set up the amount comparable to the same
industry and sufficient to motivate and retain those qualified
executives and dependable on the Company’s financial status as well as
each individual’s performance. The Audit committee was assigned to be
responsible for the determination of the remunerations for the Chairman
of the Executive Board, Executive Directors President and Managing
Director. The Executive directors who are also the executive staff of
the Company receiving fixed salary will be eligible to receive only the
meeting fee as a member of the board of Directors but will receive bonus
only as the Executives and not as a member of the Board. The Executive
Directors who are not the executive staff of the Company will be
eligible to receive Bt10,000 per month and bonus will be paid dependable
on performance. Remunerations for the Executive VP position up to Senior
Executive VP will be determined by the President through the approval of
the Executive Board. Details of remunerations in the year 2005 are
stated under No. 2.9 (3).

11. Board of Directors’ Meeting

The Board of Directors’ Meeting is held monthly on the second Thursday
of the month and, if necessary, a special meeting will be called where
clear agenda will be stipulated in advance. Regular agendas for
consideration include monitoring the Company’s performance and financial
status and summary of minutes of the meeting of the Executive Board and
the Audit Committee. Secretary to the Board will set up the meeting
invitation comprising the agenda and other reference documents and send
them out to the Board members about 7 days prior to the meeting date so
that the directors will have enough time to study the documents in
concern before coming to the meeting. Normally, the Board meeting will
take up about 2 hours. In 2005, there were totally 11 regular meetings
held and 4 other special meetings which made a total of 15 meetings. The
meeting attendance of each director is tabled below:

+--------------------+----------+--------------+---------+------------+
| Name               | Terms of | Time         |         |            |
|                    | Position | participate  |         |            |
|                    | held     | / Total      |         |            |
|                    |          | Meeting      |         |            |
|                    |          | (times)      |         |            |
+--------------------+----------+--------------+---------+------------+
|                    |          | Regular      | Special | Total      |
|                    |          | Meeting      | Meeting |            |
+--------------------+----------+--------------+---------+------------+
| 1.  Mr.Vitoon      | whole    | 11           | 4       | 15         |
|     Wongkusolkit   | year     |              |         |            |
+--------------------+----------+--------------+---------+------------+
| 2. Mr.Wichien      | whole    | 11           | 4       | 15         |
| Wattanakun         | year     |              |         |            |
+--------------------+----------+--------------+---------+------------+
| 3. Mr.Verajet      | whole    | 9            | 4       | 13         |
| Vongkusolkit       | year     |              |         |            |
+--------------------+----------+--------------+---------+------------+
| 4. Mr.Vorapol      | whole    | 10           | 4       | 14         |
| Socatiyanurak      | year     |              |         |            |
+--------------------+----------+--------------+---------+------------+
| 5. Mr.Kulvat       | whole    | 8            | 4       | 12         |
| Janvatanavit       | year     |              |         |            |
+--------------------+----------+--------------+---------+------------+
| 6. Mrs.Wilaiwan    | whole    | 11           | 3       | 14         |
| Tantitham          | year     |              |         |            |
+--------------------+----------+--------------+---------+------------+
| 7. Ms.Tippranee    | whole    | 8            | 4       | 12         |
| Chatmanop          | year     |              |         |            |
+--------------------+----------+--------------+---------+------------+
| 8. Mr.Chongrak     | whole    | 10           | 4       | 14         |
| Sripunporn         | year     |              |         |            |
+--------------------+----------+--------------+---------+------------+
| 9.Mr.Chokechai     | whole    | 11           | 4       | 15         |
| Tanpoonsinthana    | year     |              |         |            |
+--------------------+----------+--------------+---------+------------+
| 10. Ms.Sudthida    | 5 months | 5            | 4       | 9          |
| Chirapatsakul      |          |              |         |            |
+--------------------+----------+--------------+---------+------------+

However, all members of the Board of Directors can informally give their
advices to the Management whenever required even if there is no formal
meeting. Minutes of the Meeting is always recorded in writing, verified
and accurately kept ready to be examined from all concerns.

12. Committees

In 2005, there were some adjustments of some sub-committees to be more
suitable which included the substitution of Risk Control Committee to
Risk Management Committee in that the scope of risk controlling and the
formulation of policies and management systems would include Derivatives
business which will be the new business of the company. In addition, IT
Committee was newly set up to be responsible for the improvement and
development of new operating systems to support the company’s new
businesses. List of the Board and Committees and its power and duties
can be found in No. 2.9, Sub-Clause 1: Management Structure. In this
regard, only meetings held in 2005 are described here.

-Audit Committee

In 2005, Audit Committee has arranged a regular monthly meeting for 12
meetings to consider various matters under its normal responsible areas
indicated in its Chartered and reported its performance to the Board of
Directors. In addition, Audit Committee is also assigned to take up the
responsibilities of the Remunerations Committee so as to be more
independent. The additional authorities and responsibilities are as
follows:

1.  Propose remunerations payment rules and policies for the Board of
    Directors to be approved by the shareholders at the AGM.

2.  Determine the annual remunerations and all other remunerations for
    executive level ranging from the MD to the Chairman of the Executive
    Board.

3.  Determine the annual remunerations adjustment budget as well as the
    annual bonus of management staff ranging from Executive Vice
    President up to Senior Executive Vice President the amount of which
    proposed by MD and with the approval from the Executive Board.

-Risk Control Committee

This committee is the committee which was set up to substitute the
previous Risk Control Committee so as to be responsible for not only the
securities and Investment Banking businesses but also to be prepared to
cover the Derivatives business. During the year 2005, there were
altogether 22 meetings in which 9 meetings were to consider about the
securities underwriting and the rest were to consider matters designated
as its duties and responsibilities of which reports were made to the
Executive Board.

  -Human Resources Committee

  In 2005, the Committee held 2 meetings to consider matters as
  responsible by the Committee before reporting or seeking approval from
  the Executive Board including reviewing the adjustment of
  contributions given to employee’s Provident Fund, Best performance
  department Award of the year, Key Performance Indicator (KPI) plan for
  marketing units, operational guideline for KPI set up of the year,
  reviewing of regulations concerning employees’ promotion and
  organizing employee training courses, namely, “Business Presentation
  Skill” and “The Boss” courses (More details can be found in Clause
  (5): Human Resources.)

13. Controlling System and Internal Audit

-   Controlling system and Internal Audit

  The Company has emphasized on the efficient internal control system
  over both management and operational levels. Authorities and
  responsibilities of each level have been carefully and clearly set up
  in writing. Company’s assets have been used to contribute maximum
  benefits and the performer and the controller are separated persons to
  be able to cross check with each other. Moreover, another internal
  control system was the financial control system. The Company has set
  up financial report system through which the financial matters were
  reported to the responsible line of management.

  The task of the Company’s Compliance & Internal Audit Department is to
  audit and inspect the Company’s main operations and significant
  financial activities to ensure that they are effectively carried out
  according to the guidelines, including the compliance control. To
  ensure that the Department can perform its duty as independently and
  as comprehensively as possible, the Board of Directors requires the
  Department to submit an auditing report to the Audit Committee before
  the Audit Committee reports its opinion directly to the Executive
  Board for further amendment. The Audit Committee may also report its
  operation to the Board of Directors as well.

  The report on the Result of the Evaluation on sufficiency of the
  Company’s internal control system as of 11 January, 2006 evaluated by
  the Board of Directors showed that during the year 2005, the Company’s
  internal control system were sufficient, details of which are stated
  as follows:

• Organization and Environment

The Company has frequently reviewed and adjusted its organization
structure to be more suitable and relevant to the changing of the
Company’s business situation/ condition to maintain its utmost
efficiency. Written operational rules and regulations are also set up to
be compatible with the new rules and regulations of SET and SEC.

-   Risk Control Management

  The Company always emphasizes on minimizing risk in order to maintain
  stability in business. Risk Management Committee was set up to take
  care of the risk control management function. In particular, it had
  been set up to examine and control as well as to give advices to
  protect any risks arisen in all types of businesses of the company. In
  the year 2005, its responsibilities had included the Derivatives
  business which would become its new business as soon as it has been
  approved.

• Monitoring Management’s Operations

  The Company has formulated an action plan where scopes of power and
  amount of money approved by each level of executives in the securities
  business will be periodically reviewed to ensure that it remains in
  consistent with the Company’s corporate structure and policy and for
  more efficient operations. At present, the plan has been fully
  reviewed and has been produced in a form of an executive manual as a
  guideline for the management.

• Information Technology and Communications

  New technology has been brought in to internally communicate the
  authorities’ rules and regulations or even its own regulations. The
  Company will disseminate information via email to each department
  having email address of its own for speedy and comprehensive internal
  communications. In addition, the Company has set up each department’s
  homepage in its Intranet to post the latest information or other
  departmental movements among internal staff. Employees are also able
  to download various internal forms from these homepages.

• Follow-up System

Report of the Company’s operations is always included in the Board of
Directors’ meeting agenda stating the causes of the deviation from the
set goal as well as the suggested marketing strategies for the Board to
consider and to make decision. Moreover, there will also be an agenda
for the Audit Committee to report the auditing results from the
Compliance Unit and the Management Internal Control Department and
include them in the minutes of the Audit Committee’s meeting.

14. Directors’ Reporting

The Board of Directors is responsible for the Company and its
consolidated Company’s financial statement and information disclosed in
the Company’s Annual Report. Such financial statement was done in
accordance with the certified accounting standard generally accepted in
Thailand with suitable accounting policy, consistency, cautions and best
projection together with the disclosure of necessary information stated
in the auditor’s Note to Financial Statement.

Moreover, effective internal control system will always be maintained to
reasonably support that the accounting record was done accurately,
completely and adequately to record the existence of the company’s
assets and to aware of the company’s weaknesses in order to protect
against any fraud or dishonest actions in significance.

Consequently, Audit Committee was set up to consist of those
non-executive directors to avoid any conflict of interest and who would
be accountable for the quality of the financial report and the internal
control system comments of which was already appeared under Audit
Committee report in the Annual Report of the Company.

The Board of Directors had determined that the Company’s internal audit
system as a whole was highly acceptable and was able to rationally
confirm the reliability of the Company and its consolidated Company’s
financial statement as of 31 December, 2005.

15. Relations with Investors

The Board of Directors has realized the importance of disclosing
complete, accurate, transparent and highly-accessible financial and
general information as well as data which may affect its share prices to
shareholders, general investors and relevant parties on an equal basis
for a long time. Information, which will be used as part of investment
decision, is disseminated via the Stock Exchange of Thailand (SET)’s
various channels as well as the Company’s own website. Investors and the
interested public can log in for more information about the Company or
its securities analysis reports at www.unitedsec.com. The Company set up
the Corporate Communications and Investors’ Relations Division under the
supervision of the Executive Office to provide data and other corporate
information to investors, shareholders and the public. To contact us,
please call 0-2207-0038 ext. 316 or send email to IR@unitedsec.com.
However, during the year 2005, there was not much activity from Investor
Relations part as the Company is still searching for the suitable
personnel.

  (5) Human Resources

As of 31 December 2005, the Company had a total headcount of 255 persons
which can be categorized below:

  1. Marketing group (front office staff) 167 persons

  2. Investment Banking group 2 persons

  3. Operations group(back office staff) 38 persons

  4. Others 48 persons

There were 10 branches of which 68 persons were the branches’ staff .

The overall remunerations of the employees categorized by types of
remunerations are shown in the table below:

+--------------------+---------------+---------------+---------------+
| Types of           | Year 2003     | Year 2004     | Year 2005     |
| Remunerations      |               |               |               |
|                    |               |               |               |
| (Unit :Baht)       |               |               |               |
+--------------------+---------------+---------------+---------------+
| Salary             | 59,237,590.60 | 80,458,717.29 | 98,946,541    |
+--------------------+---------------+---------------+---------------+
| Bonus              | 47,524,238.53 | 21,306,245.39 | 5,085,695     |
+--------------------+---------------+---------------+---------------+
| Contribution on    | 1,646,085.77  | 2,163,024.78  | 4,032,459     |
| Provident Fund     |               |               |               |
+--------------------+---------------+---------------+---------------+
| Marketing          | 1             | 85,035,925.76 | 53,333,392    |
| Incentive          | 13,236,023.06 |               |               |
+--------------------+---------------+---------------+---------------+
| Others             | 4,795,840.38  | 3,696,543.09  | 4,563,579     |
+--------------------+---------------+---------------+---------------+
| Total              | 2             | 1             | 165,961,666   |
|                    | 26,527,785.33 | 92,660,457.69 |               |
+--------------------+---------------+---------------+---------------+

Human Resources Management Policy and Human Resources Management System

The Human Resources Committee which was appointed by the Board of
Directors held regular meetings to propose policies, plans and
regulations for the development of staff efficiency and human resources
operational system to the Executive Board. The main project includes
annual human resources development plan of which staff’s minimum period
of learning skill and training standards are set up differently
dependable on the position level and scope of duties and
responsibilities of each staff. Such development includes the training
carried out by well known guest speakers arranged for both front and
back offices staff.

Promotion of Better Life Quality and Job Security

As quality work always comes from happy employees who feel secured in
their jobs, aside from developing the capability of its human resources
and its human resources management system, the Company also pursues a
policy to promote better quality of life and to boost the feeling of job
security. During the past year, we initiated important project to
promote this policy, namely, the increment of staff’s welfare rate for
health insurance.