3. Nature of Business

Pato Chemical Industry Plc. was established on 6 October 1973 to import,
formulate, and distribute pesticide in Thailand. Its initial registered
capital was 1 million baht with 1,000 ordinary shares at par value of
1,000 baht per share. PATO CHEMICAL INDUSTRY PUBLIC COMPANY LIMITED in
October 1993 then continued to sell its ordinary stocks for 3,000,000
shares at Bt 55 per share, valued at Baht 10 per share in July 1995,
PATO increased its capital to Baht 140 million. The company has been
listed in the Stock Exchange of Thailand in August 1995. Resolution of
shareholders’ meeting in 2009 approved share split from 10 baht per
share to 1 baht per share. The ordinary shares of the company are then
140,000,000 shares.

(1) Major Changes and Development

+-----------+---+--------------------------------------------------------+
| April     | : | 2009 Annual General Meeting of Shareholders where the  |
| 2009      |   | meeting appointed                                      |
|           | : |                                                        |
| May 2009  |   | Mr. Sahai Supsoontornkul as another independent        |
|           | : | director. The company presently has 4 independent      |
| January   |   | directors out of 12 directors in order to comply with  |
| 2010      | : | good governance.                                       |
|           |   |                                                        |
| February  | : | Ms. Nongram Laoha-areedilok Registration No. 4334 from |
| 2010      |   | AST Master Co.,Ltd or                                  |
|           | : |                                                        |
|           |   | Mrs. Suvimol Krittayakiern Registration No. 2982 from  |
|           |   | Office of DIA International Auditing were appointed to |
|           |   | be the Company’s auditor for 2009.                     |
|           |   |                                                        |
|           |   | Share split from 10.00 baht per share to 1.00 baht per |
|           |   | share                                                  |
|           |   |                                                        |
|           |   | Dividend payment of 7.50 baht per share for 2008       |
|           |   | performance                                            |
|           |   |                                                        |
|           |   | Complete the registration of share split with the      |
|           |   | Minister of Commerce from 10.00 baht per share to 1.00 |
|           |   | baht per share.                                        |
|           |   |                                                        |
|           |   | Sojitz Corporation, major shareholders from Japan has  |
|           |   | divested its 15% stake to less than 10% stake.         |
|           |   |                                                        |
|           |   | Mr.Masahiko Nishizawa resigned from being member of    |
|           |   | the board of directors.                                |
+-----------+---+--------------------------------------------------------+

Development of major shareholders from 31 December 2006 – 29 January
2010

[TABLE]

(2) Pato Chemical Industry Public Company Limited

The company is the importer, formulator, and distributor of pesticide.

Major Type of Imports

1. Technical Grade (TG): is a concentrated chemicals which are used in
formulations to produce final products according to the specified
formulas

2. Finished Product (FP): is the product ready for use. Most of the
imported FD is in liquid and solid form in bulk sizes. Therefore,
repackaging is needed before distribution.

About 80% of the company's imported products are TG for formulation at
the factory before distribution resulted in lower cost of raw material
as compared with other competitors who import finished product for
repackaging. TG has longer shelf-life than FP and can be formulated
according to the requirements which is more suitable for the
environment. Chemical pesticide in the market can be in many forms e.g.
liquid, power, and granule for safety in moving and storing. In the
production process, there are 2 main ingredients in chemical pesticide;
active and inert ingredients. “Active Ingredients” are chemical
substance called by its chemical names for different uses of purposes.
“Inert Ingredients” are substance to combine with the active chemical to
make it in the forms suitable for different types for uses such as
solvents, carriers, surfactants, emulsifiers, or any other substance
which are added for special purpose called “Special Additives”.

Shareholders’ Structure

a) Trillit Asia Mineral Processing Co.,Ltd.

  b) Sojitz Corp.

c) Pojanalai

d) Wesaratchawest

e) Choengwiwatkit

a) 0.54% a )36.64% a) 39.30% a) -

b) - b) 8.40% b) - b) -

c) 0.54% c) 12.31% c) 12.70% c) 94 %

d) - d) 7.47% d) 19.60% d) -

e) 0.27% e) 6.47% e) 15.70% e) -

1.35% 71.29% 87.30% 94%

Pato Chemical Industry Plc Kentex Properties Co.,Ltd

Registered Capital Baht 140 Million (Office Space Rental)

0.01%

Plastic Precision Industry Co.,Ltd

Registered Capital Baht 115 Million Connected transaction such as loan,
bank guarantee, office space rental

(3) Revenue Structure

+-------------------+------+------+-----+----+-----+---+-----+----+
|                   | Oper | Per  | 2   |    | 2   |   | 2   |    |
|                   | ated | cent | 007 |    | 008 |   | 009 |    |
|                   |      | agee |     |    |     |   |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
|                   |      | Of   | Mil | %  | Mil | % | Mil | %  |
|                   |      | Sh   | B   |    | B   |   | B   |    |
|                   |      | ares | aht |    | aht |   | aht |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Local Sales by    |      |      |     |    |     |   |     |    |
| Products          |      |      |     |    |     |   |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Product Line 1    | PATO |      |     |    |     |   |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Insecticide       |      |      | 169 | 2  | 193 | 2 | 322 | 3  |
|                   |      |      | .68 | 7. | .79 | 5 | .07 | 7. |
|                   |      |      |     | 10 |     | . |     | 50 |
|                   |      |      |     |    |     | 2 |     |    |
|                   |      |      |     |    |     | 8 |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Herbicide         |      |      | 346 | 5  | 402 | 5 | 365 | 4  |
|                   |      |      | .16 | 5. | .08 | 2 | .56 | 2. |
|                   |      |      |     | 29 |     | . |     | 57 |
|                   |      |      |     |    |     | 4 |     |    |
|                   |      |      |     |    |     | 5 |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Fungicide         |      |      | 42  | 6. | 74  | 9 | 103 | 1  |
|                   |      |      | .18 | 74 | .42 | . | .44 | 2. |
|                   |      |      |     |    |     | 7 |     | 04 |
|                   |      |      |     |    |     | 1 |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Acaricide         |      |      | 21  | 3. | 21  | 2 | 21  | 2. |
|                   |      |      | .47 | 43 | .62 | . | .51 | 51 |
|                   |      |      |     |    |     | 8 |     |    |
|                   |      |      |     |    |     | 2 |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Other             |      |      | 46  | 7. | 74  | 9 | 46  | 5. |
|                   |      |      | .63 | 44 | .67 | . | .21 | 38 |
|                   |      |      |     |    |     | 7 |     |    |
|                   |      |      |     |    |     | 4 |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Total Local Sale  |      |      | 626 | 1  | 766 | 1 | 858 | 1  |
|                   |      |      | .12 | 00 | .58 | 0 | .78 | 00 |
|                   |      |      |     |    |     | 0 |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Export Sales by   |      |      |     |    |     |   |     |    |
| Products          |      |      |     |    |     |   |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Product Line 1    | PATO |      |     |    |     |   |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Insecticide       |      |      | -   | -  | -   | - | -   | -  |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Herbicide         |      |      | -   | -  | -   | - | -   | -  |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Fungicide         |      |      | -   | -  | -   | - | -   | -  |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Acaricide         |      |      | -   | -  | -   | - | -   | -  |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Other             |      |      | -   | -  | -   | - | -   | -  |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Total Export      |      |      | -   | -  | -   | - | -   | -  |
| sales             |      |      |     |    |     |   |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Local & Export    |      |      |     |    |     |   |     |    |
| Sales             |      |      |     |    |     |   |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Product Line 1    | PATO |      |     |    |     |   |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Insecticide       |      |      | 169 | 2  | 193 | 2 | 322 | 3  |
|                   |      |      | .68 | 7. | .79 | 5 | .07 | 7. |
|                   |      |      |     | 10 |     | . |     | 50 |
|                   |      |      |     |    |     | 2 |     |    |
|                   |      |      |     |    |     | 8 |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Herbicide         |      |      | 346 | 5  | 402 | 5 | 365 | 4  |
|                   |      |      | .16 | 5. | .08 | 2 | .56 | 2. |
|                   |      |      |     | 29 |     | . |     | 57 |
|                   |      |      |     |    |     | 4 |     |    |
|                   |      |      |     |    |     | 5 |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Fungicide         |      |      | 42  | 6. | 74  | 9 | 103 | 1  |
|                   |      |      | .18 | 74 | .42 | . | .44 | 2. |
|                   |      |      |     |    |     | 7 |     | 04 |
|                   |      |      |     |    |     | 1 |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Acaricide         |      |      | 21  | 3. | 21  | 2 | 21  | 2. |
|                   |      |      | .47 | 43 | .62 | . | .51 | 51 |
|                   |      |      |     |    |     | 8 |     |    |
|                   |      |      |     |    |     | 2 |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Other             |      |      | 46  | 7. | 74  | 9 | 46  | 5. |
|                   |      |      | .63 | 44 | .67 | . | .21 | 38 |
|                   |      |      |     |    |     | 7 |     |    |
|                   |      |      |     |    |     | 4 |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Total Local &     |      |      | 626 | 1  | 766 | 1 | 858 | 1  |
| Export sales      |      |      | .12 | 00 | .58 | 0 | .78 | 00 |
|                   |      |      |     |    |     | 0 |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Less returned &   |      |      | 5   | 0. | 8   | 1 | 7   | 0. |
| Discount          |      |      | .58 | 89 | .55 | . | .16 | 83 |
|                   |      |      |     |    |     | 1 |     |    |
|                   |      |      |     |    |     | 1 |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Net Sales         |      |      | 620 | 9  | 758 | 9 | 851 | 9  |
|                   |      |      | .54 | 8. | .03 | 9 | .62 | 8. |
| มูลค่าก             |      |      |     | 94 |     | . |     | 85 |
| ารรับจ้างผลิตหรือบรรจุ |      |      |     |    |     | 5 |     |    |
|                   |      |      |     |    |     | 5 |     |    |
| รายได้อื่นๆ          |      |      |     |    |     |   |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Contractor        |      |      | -   | -  | -   | - | -   | -  |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Other Income      |      |      | 6   | 1. | 3   | 0 | 9   | 1. |
|                   |      |      | .64 | 06 | .41 | . | .93 | 15 |
|                   |      |      |     |    |     | 4 |     |    |
|                   |      |      |     |    |     | 5 |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+
| Total Revenue     |      |      | 627 | 1  | 761 | 1 | 861 | 1  |
|                   |      |      | .18 | 00 | .44 | 0 | .55 | 00 |
|                   |      |      |     |    |     | 0 |     |    |
+-------------------+------+------+-----+----+-----+---+-----+----+