+-----------------------------------------------------------------------+
| Securities and Shareholders Information                               |
+-----------------------------------------------------------------------+

7.1 Share capital registered & Paid-up capital

  (1) Share capital registered

Company : Thai Carbon Black Public Company Limited

Business : Manufacturing

Registration No. : 0107537001251

Share registered : Baht 300,000,000

Paid-up capital : Baht 300,000,000

No. of share : 300,000,000

Par value : Baht 1.-

7.2 Details of major shareholders

  ------ ----------------------------- ---------------- ------------ --------
  Sr.    Name of shareholders          Nationality      No. of Share %
  No.                                                                

  1      Thai Rayon Public Co., Ltd.   Thai             74,937,500   24.98

  2      CIMB Securities (Singapore)   Singaporean      55,054,820   18.35
         Pte Ltd                                                     

  3      Everlon International Holding British Virgin   37,687,500   12.56
                                       Island                        

  4      P.T. Indo Bharat Rayon        Indonesian       23,296,880   7.77

  5      HSBC (Singapore) Nominees Pte Singaporean      13,000,000   4.33
         Ltd                                                         

  6      Hiltop Limited                British Virgin   10,271,250   3.42
                                       Island                        

  7      Asseau Company Ltd.           British Virgin   10,040,120   3.35
                                       Island                        

  8      Thevaraya Co., Ltd.           Thai             6,566,250    2.19

  9      Thai Industrial Management    Thai             5,810,380    1.94
         and Trading Co. Ltd.                                        

  10     Ganaria International Corp.   British          5,798,000    1.93
  ------ ----------------------------- ---------------- ------------ --------

(Source : Share registrar as on 27.03.2014)

7.3 Dividend Policy

The company would like to reiterate its dividend policy of paying
dividend between 20-35% of net profit after tax, however, the payment of
dividend will be based on its requirement of funds for CAPEX, expansion
projects , future growth plans and for investment in various other
projects. If payment of dividend will have effect on company’s
performance and cash flow requirements for its operations and for growth
plans and investments, the company will decide for payment of dividend
accordingly in the best interest of the company.

Five-year dividend payment history of the company is as follows:

  --------------------- --------- --------- --------- --------- ---------
  Year                  Year      Three     Year      Year      Year
                        Ended     month     Ended     Ended     Ended
                        31^(st)   period    31^(st)   31^(st)   31^(st)
                        Mar 2014  ended     Dec 2012  Dec 2011  Dec 2010
                                  31^(st)                       
                                  Mar 2013                      

  Earnings per Share    1.76      (0.91)    2.39      2.90      3.43

  Dividend per Share    0.44      0.11      0.44      0.80      1.00

  Dividend Payout Ratio 25%       NA        18.41%    27.59%    29.15%
  --------------------- --------- --------- --------- --------- ---------

+-----------------------------------------------------------------------+
| 7.  Management Structure                                              |
+-----------------------------------------------------------------------+

Management structure comprises of

1.  Board of Directors

2.  Audit Committee

3.  Management team

8.1 Board of Directors

There were 10 directors on the Board of the company as of 31^(st) March
2014.

  ------------------------------- ---------------------------------------
  Name                            Position

  1. Mr. Kumar Mangalam Birla     Chairman

  2. Mrs. Rajashree Birla         Director

  3. Dr. Santrupt B. Misra        Director

  4. Mr. S.S. Mahansaria          Independent Director / Audit committee
                                  member

  5. Mr. G.K. Tulsian             Independent Director / Audit committee
                                  member

  6. Mr. Prakit Pradipasen        Independent Director / Audit committee
                                  Chairman

  7. Mr. Deepak Mittal            Independent Director

  8. Mr. Rajinderpal Singh        Independent Director
  Thakralbutra                    

  9. Mr. Arvind K. Newar          Independent Director

  10. Mr. Sanjeev Sood            President & Director
  ------------------------------- ---------------------------------------

Mr. Rajesh Jha - Company Secretary

Characteristics and Definition of independent director of the Company

The Board of Directors has reviewed the independent director’s
qualification of each member as per the announcement no. Tor Jor. 4/2552
issued by The Capital Market Supervisory Board which took effect from
the date of the 2009 Annual General meeting. The total number of
company’s independent directors is 6, which is more than minimum
requirement of 1/3 of total director or at least 3 directors as
announced by The Capital Market Supervisory Board.

Duties & Responsibilities of Board of Directors

1.  To perform duties in accordance with the laws, the company
    objectives, Article of Association and resolution of shareholders
    meeting by upholding Integrity and to the best interest of company
    as well as shareholders.

2.  To be responsible for setting up the company’s policies, direct,
    monitor and supervise the management to implement the policies and
    to carry out the laid down objectives efficiently, effectively and
    in the best interest of the company.

3.  To be responsible for appointing the Audit Committee and its scope
    of work

4.  To convene the meeting of Shareholders and Board of Directors at
    least once a year and once a quarter respectively.

Nomination of Directors 

The Company does not have a nominating committee, but the process for
selecting individuals to be appointed as Directors includes
consideration of a number of characteristics including skills,
experience and capability, especially in areas that are of the greater
benefit to the Company, and integrity. Finally the individual must not
possess any of the qualities or characteristics prohibited by the Listed
Companies Act.

Approval is by simple majority of votes of those shareholders present or
duly represented at the meeting and in possession of voting rights.

Appointment of Directors

1.  The appointment of director is made by a majority vote of the
    shareholder’s meeting in accordance with the following conditions
    and procedures

  a.) One shareholder shall have one vote for each share

b.) Each shareholder shall exercise all the votes he/she has under (a)
to appoint the nominated persons to be directors on a person by person
basis, provided that he can not divide his vote to any person to any
extent

c.) The persons obtaining the most votes in descending order shall be
elected as directors equal to the number of directors required or ought
to be elected. If there is a tie in the last to be elected and this
exceeds the said member of directors. The presiding chairman will have
the casting vote for election of last director.

2.  The company should have at least 6 directors. Not less than half of
    the directors shall have residence in the kingdom of Thailand

3.  Directors of the company are not appointed by the Nominating
    Committee

Audit Committee

Audit Committee comprises of 3 independent directors for a term of 3
years service which is effective from 2^(nd) March 2012.

1. Mr. Prakit Pradipasen : Chairman

2. Mr. S. S. Mahansaria : Member of audit committee

3. Mr. G. K. Tulsian : Member of audit committee

With Mr. Prabhat Gupta, CFO as the secretary of the Audit Committee

Remark: All 3 members of Audit Committee have adequate expertise and
experience in the field of finance and account to analyze financial
statements.

Duties & Responsibilities of Audit Committee

The Audit Committee undertakes its responsibilities as described in the
Audit Committee Charter, which is revised and approved by Board of
Directors. The responsibilities of the Audit Committee are detailed
below.

1.  To review the Company’s financial reporting process to ensure that
    it is accurate and adequate;

2.  To review the Company’s internal control system and internal audit
    system to ensure that they are suitable and efficient, to determine
    an internal audit unit’s independence, as well as to approve the
    appointment, transfer and dismissal of the chief of an internal
    audit unit or any other unit in charge of an internal audit;

3.  To review the company’s compliance with the law on securities and
    exchange, the Exchange’s regulation, and the laws relative to the
    Company’s business;

4.  To consider select and nominate an independent person to be the
    Company’s auditor, and to propose such person’s remuneration, as
    well as to attend a non management meeting with an auditor at least
    once a year;

5.  To review the connected transactions, or the transactions that may
    lead to conflicts of interests, to ensure that they are in
    compliance with the law and the Exchange’s regulations, and are
    reasonable and for the highest benefit of the Company;

6.  To prepare and to disclose in the Company’s annual report, an audit
    committee’s report which must be signed by the audit committee’s
    chairman and consist of at least the following information;

    a.  An opinion on the accuracy, completeness and creditability of
        the Company’s financial report;

    b.  An opinion on the adequacy of the Company’s internal control
        system;

    c.  An opinion on the compliance with the law on securities and
        exchange, the Exchange’s regulations, or the laws relating to
        the Company’s business;

    d.  An opinion on the suitability of an auditor;

    e.  An opinion on the transactions that may lead to conflicts of
        interests;

    f.  The number of the audit committee meetings, and the attendance
        of such meetings by each committee member;

    g.  An opinion or overview comment received by the audit committee
        from its performance of duties in accordance with charter, and

    h.  Other transactions which, according to the audit committee’s
        opinion, should be known to the shareholders and general
        investors, subject to the scope of duties and responsibilities
        assigned by the Company’s Board of Directors.

7.  To perform any other act assigned by the Company’s Board of
    Directors, with the approval of the audit committee.

8.2 Management team

The company’s management team comprises of 6 persons as detailed below:

  ----------------------------------- -----------------------------------
  Name                                Position

  1. Mr. Sanjeev Sood                 President & Director

  2. Mr. S. Rajamohamed               Unit Head

  3. Mr. Surendra Pandey              Head of Manufacturing

  4. Mr. Prabhat Gupta                Head of Finance & Commercial

  5. Mr. Amit Saini                   Head of Marketing

  6. Mr. Latthasit Thongklaew         Head of HR & Administration
  ----------------------------------- -----------------------------------

Duties & Responsibilities of the Management

The management team headed by President & Director is responsible for
management of the business of company and have authority to appoint
persons as needed and qualified as employees, assign duties and
responsibilities for them, tasked with overseeing and accurately
reporting on the financial report of the company, ensuring the
appropriateness and efficiency of the company’s internal control system,
and designing employee regulations within such parameters.

8.3 Company Secretary

The Board of Directors has appointed Company Secretary to provide advice
on any laws, regulations, and procedures that the Board of Director has
to follow. The Company Secretary is also responsible for the Board of
Directors’ meeting, shareholders’ meeting, compliance of relevant laws
and regulations on the information disclosure. On 15 August 2011, Mr.
Rajesh Jha was appointed by the Board as the Company Secretary.

8.4 Remuneration to Directors

According to Article 13 of Articles of Association of the Company, The
directors of the Company shall be entitled to receive fee for attending
each meeting of Board of Directors or committee thereof, or for
performance of any other duty, as may be decided by General Meeting of
shareholders from time to time. The Directors shall also be entitled of
reimbursement of any expenses incurred by them in performance of their
duties.

The General Meeting of Shareholders held on 12^(th) July 2013, had
approved following increase in Directors’ remuneration:

Prior to 12^(th) July 2013 From 12^(th) July 2013

A.  Board meetings:

Chairman 25,000 35,000

Other attending directors 25,000 25,000

B.  Audit Committee meetings

Chairman 10,000 15,000

Other attending directors 10,000 10,000

Details of Director’s meeting fee and Audit Committee fee for year April
2013 to March 2014 is given below

+---------------------+--------+--------+--------+------+------------+
| Name                | Board  |        | Audit  |      | Remark     |
|                     | of     |        | Com    |      |            |
|                     | Di     |        | mittee |      |            |
|                     | rector |        | M      |      |            |
|                     |        |        | eeting |      |            |
|                     | M      |        |        |      |            |
|                     | eeting |        |        |      |            |
+---------------------+--------+--------+--------+------+------------+
|                     | Atte   | Fees   | Atte   | Fees |            |
|                     | ndance |        | ndance |      |            |
|                     |        | (Baht) |        | (B   |            |
|                     | (      |        | (      | aht) |            |
|                     | Times) |        | Times) |      |            |
+---------------------+--------+--------+--------+------+------------+
| 1. Mr. Kumar        |   -    | -      |        |      |            |
| Mangalam Birla      |        |        |        |      |            |
+---------------------+--------+--------+--------+------+------------+
| 2. Mrs. Rajashree   |   -    | -      |        |      |            |
| Birla               |        |        |        |      |            |
+---------------------+--------+--------+--------+------+------------+
| 3. Dr. Santrupt B.  |   4/5  | 1      |        |      |            |
| Misra               |        | 00,000 |        |      |            |
+---------------------+--------+--------+--------+------+------------+
| 4. Mr. S.S.         |   5/5  | 1      |   5/5  | 50   |            |
| Mahansaria          |        | 25,000 |        | ,000 |            |
+---------------------+--------+--------+--------+------+------------+
| 5. Mr. G.K. Tulsian |   3/5  | 75,000 |   3/5  | 30   |            |
|                     |        |        |        | ,000 |            |
+---------------------+--------+--------+--------+------+------------+
| 6. Mr. Prakit       |   5/5  | 1      |   5/5  | 65   |            |
| Pradipasen          |        | 55,000 |        | ,000 |            |
+---------------------+--------+--------+--------+------+------------+
| 7. Mr. Deepak       |   5/5  | 1      |        |      |            |
| Mittal              |        | 25,000 |        |      |            |
+---------------------+--------+--------+--------+------+------------+
| 8. Mr. Rajinderpal  |   4/5  | 1      |        |      |            |
| Singh Thakralbutra  |        | 00,000 |        |      |            |
+---------------------+--------+--------+--------+------+------------+
| 9. Mr. Arvind K.    |   -    | -      |        |      |            |
| Newar               |        |        |        |      |            |
+---------------------+--------+--------+--------+------+------------+
| 10. Mr. Sachin      |   1/1  | 25,000 |        |      | R          |
| Jitendra Mehta      |        |        |        |      | esignation |
|                     |        |        |        |      | accepted   |
|                     |        |        |        |      | in Board   |
|                     |        |        |        |      | meeting    |
|                     |        |        |        |      | held on 12 |
|                     |        |        |        |      | July 2013  |
+---------------------+--------+--------+--------+------+------------+
| 11. Mr. Sanjeev     |   5/5  | 1      |        |      |            |
| Sood                |        | 25,000 |        |      |            |
+---------------------+--------+--------+--------+------+------------+

Summary of director’s remuneration to Board members is given below

+-----------------------------+-------------------+--------------------+
| Details of Remuneration     | 2013-14           | 2013               |
|                             |                   |                    |
|                             | (Apr2013 – Mar    | (Jan – Mar 2013)   |
|                             | 2014)             |                    |
+-----------------------------+-------------------+--------------------+
| 1. Board of Director’s      | 830,000           | 425,000            |
| Meeting fee                 |                   |                    |
+-----------------------------+-------------------+--------------------+
| 2. Audit Committee Meeting  | 145,000           | 30,000             |
| fee                         |                   |                    |
+-----------------------------+-------------------+--------------------+
| 3. Executive Director’s     | -                 | -                  |
| remuneration                |                   |                    |
+-----------------------------+-------------------+--------------------+
| 4. **Director pension       | 2,651,760         | 662,940            |
+-----------------------------+-------------------+--------------------+
| Total remuneration          | 3,626,760         | 1,117,940          |
+-----------------------------+-------------------+--------------------+

Remark

** The shareholder's meeting has approved pension & gratuity payment to
Mr. Deepak Mittal, Director of the company on 29th April 2008 effective
from January 2008. The company shall pay a lump-sum one-time payment of
not over Baht 7.5 million and monthly pension in amount not over Baht
250,000.

2. Remuneration to Senior Executives

1.  Cash Benefit (includes salary, allowances and bonus)

  Year Cash Benefit

  Year 2013-14 (Apr13 – Mar14) 29,734,407- Baht

  Year 2013 (Jan – Mar 2013) 7,526,118- Baht

  2. Other Benefits None-

8.5 Personnel

Manpower structure as on 31.03.2014

  ----------------- ----------------- ----------------- -----------------
                    Officers /Staff   Worker            Total

  Factory           174               86                260

  Head office       19                -                 19

  Total             193               86                279
  ----------------- ----------------- ----------------- -----------------

-   There have been no significant change in no. of employees during the
    year Apr2013 - Mar2014

-   Total remuneration and benefits to all employees for the year
    Apr2013 – Mar2014 is Baht 352 million for salary wages, bonus, over
    time, medical expenses, social security welfare etc.

-   The company gives very high importance for the all round development
    of all the employees and prepares a detailed training plan and skill
    inventory for each employee based on his / her need and functional
    responsibilities for the full year and the same is monitored closely
    by Training Department and the department managers. The company
    organizes training of employees by internal & external faculties and
    also send employees to various Institutes /Associations in Thailand
    and aboard. The company provides training on safety, environment
    control, functional topics, technical matters, general management
    leadership, strategic planning, team building, and balance
    scorecard, enhancement of performance, cross functional and multi
    skills.

+-----------------------------------------------------------------------+
| 8.  Corporate Governance                                              |
+-----------------------------------------------------------------------+

The Board of Directors recognizes the importance of good corporate
governance to optimize Company’s competitiveness and also to enhance the
Company’s trust amongst shareholders, investors and other stakeholders
which is important in order to form a basis of sustainable growth. The
Board of Directors encourages and supports the adoption & implementation
of good corporate governance principles as prescribed by the Stock
Exchange of Thailand in a prudent manner suited to the business needs of
the company.

Article 1 Rights of Shareholder

The company has the written good corporate governance policy which
includes the statutory rights of shareholders as well as the best
practices issued by SET. The good corporate governance policy comprises
of 7 principles, as follows

1.  Rights and Equitable Treatment of Shareholders and Various Groups of
    Stakeholders

2.  Structure, Roles, Duties and Independence of Directors

3.  Information Disclosure and Transparency

4.  Internal Control and Risk Management

5.  Company’s Code of Conduct

6.  Long Term Value Creation to Stakeholders

7.  Promotion of Best Practices

The company emphasizes on the rights of all shareholders, and has taken
steps to demonstrate respect for basic shareholder’s rights to ensure
equitable treatment to all as prescribed in the Company’s rules &
regulations and other relevant laws:

(1) Fundamental legal rights :

Company facilitates the exercising of their right, namely to buy, sell
or transfer shares and the right to receive a dividend.

  (2) Right to receive significant information:

Company disclosed up to date information to SET from time to time as per
the regulation of SET prescribed

(3) Right to attend meeting and vote

The company sends notice of the annual general meeting which specifies
the meeting venue, date, time, agenda and matters to be proposed to the
meeting together with appropriate details. It is clearly specified
whether the matter to be proposed at the meeting is for information or
consideration. The opinion of the Board of Directors on such matters and
proxy forms are also provided. Shareholder will receive adequate,
complete, transparent, timely and verifiable information to form
decision in advance. The Company also advertise in daily newspaper 3
days consecutively and 3 days in advance about Shareholders’ meeting.

Before shareholder meeting, the chairman of meeting explains clearly how
ballots are casted and counted under Company’s AOA.

Company allocates enough time for the meeting, the chairman conducts
each meeting suitably and transparently, The Company promotes and
supports shareholders exercising of their rights by facilitating the
exercise of the right to attend the general meeting and to vote.
Shareholders can protect their interest by exercising the rights to ask
question, express opinions, offer recommendations and vote at general
meetings, participate in decisions concerning fundamental corporate
changes such as the election or removal of directors, appointment of
independent auditors, declaration of dividends, prescription or
amendment of Company Regulation and Articles of Association and approval
of special resolutions.

Company gives shareholders who show up late, a chance to vote on agenda
items still under discussion.

All resident directors who are in Thailand attends shareholder’s
meeting. Each member of the board & audit committee may address relevant
questions and concerns posed by shareholders (if any)

Article 2 Equitable Treatment of Shareholders

The company gives equal importance to all shareholders who are treated
equitably and fairly to promote investors’ confidence.

Shareholders have the rights to assign proxies to attend the general
meeting and vote on their behalf. The conditions for assigning proxies
are provided in the meeting invitation in full details. Shareholder
could vote by proxy which is provided by company in to 3 forms Proxy
Form A (Simple form) Form B (Specific Details Form) and Form C (For
Foreign Shareholder appointing custodian in Thailand) as prescribed by
Department of Business, Ministry of Commerce. The company offers 3
independent directors names as volunteer proxies together with all
possible conflicts of interest of each independent director.

The general meeting is conducted according to the agenda notified in the
notice and it is the policy of the company not to add items to the
agenda without advance notice to shareholders

  Director election process allowed shareholder to vote for an
  individual nominee.

Article 3 Role of stakeholders

The Board realizes the importance of various stakeholders group like
customers, management and employees, suppliers, bankers and financial
institutions, shareholders, statutory auditors, the state , Community,
trade union, creditors etc and respect their rights or mutual agreement
with the company is followed

The company is a representative of the shareholders, is committed to
conducting business with transparency, to put in place reliable
financial and accounting systems, and to deliver optimum shareholder
satisfaction. To achieve this, company takes into account the long term
growth and reasonable sustained returns. The executive board and all
employees discharge their duties truthfully and honestly, manage the
Company’s business to the best of their capabilities and exercise due
care. The company and its employees refrain from any activities that
could cause conflicts of interest and serve self-interest. Confidential
information is not divulged to outside parties.

The senior management of the company regularly meets various stakeholder
groups to understand their views and needs and ensures that the
recommendations of various groups are given due importance and
implemented in the best interest of the company and for the fair and
appropriate treatment to all parties concerned

The company regularly meets its, customers, conducts annual customer
satisfaction surveys, employee satisfaction surveys, arranges customer
visits to company, organize vendor conferences, meet various government
agencies, participate in community development projects etc to meet
requirements of various stakeholders groups.

The company takes active participation in various social & community
development projects like scholarship programs, blood donation, support
during flood, adopt village, support the community programs at temples
and support various government initiatives.

The company’s believes that its employees are the most important and
valuable assets of the company and strongly encourages the employee to
participate in various developmental activities like Quality Control
Circles (QCC), “KAIZEN” Suggestion System (KSS), Total Productive
Maintenance implementation (TPM), Quality of Life Club, morning
meetings, cross functional performance team and also prepares a detailed
and intensive annual training program for each employee to continuously
improve their performance and develop multi-skills for mutual benefit.
The company also conducts Organizational Health Surveys (OHS) to take
into confidence the views of managerial & supervisory level employees
and implement various suggestions for continuous improvement. The
company also has excellent relationship with all its creditors, bankers,
financial institutions etc.

Article 4 Disclosure and Transparency

Company discloses information on material matters regarding the company,
including financial report, non-financial information and other
information as stipulated by SET and SEC that are accurate, clear,
complete, easy to understand, transparent, adequate, reliable and
timely, and which have been screened according to prescribed procedures.

Governance policy and its implementation is also reported in the annual
registration statement (Form 56-1), annual report (Form 56-2) in Thai
and English to ensure equitable access by shareholders. The company also
reports on the responsibilities of the Board of Directors for the
financial statements which appears together with the report of the
independent auditors in the annual report.

Board of Director in its meeting held on 2^(nd) March 2009 approved the
conflict of Interest policy and Insider Information Guideline to prevent
the use of insider information for insider trading or related party
transactions. Executive are responsible for reporting ownership in
Securities each time they are acquired and disposed to the Office of
Securities and Exchange Commission according to Section 59 of the
Securities and Exchange Act. This is a key tool in promoting corporate
governance with respect to insider information. The board also requested
directors and the executive to update the status of conflict of interest
every quarter.

Article 5 Responsibilities of the Board

5.1 Board Structure

According to The Article of Association of Company, the Board of
Director shall consist of not less than 5 persons, who are elected by a
General Meeting , and not less than half of the total number of
directors shall have residence within the Kingdom of Thailand and must
have qualification as prescribed by the law.

At present, the Board of Director consists of 10 directors. The Company
has 6 independent directors, which is more than SEC requirement for the
composition of the Board that at least one third of the Board membership
is made up of independent directors.

The company has specified the qualification of independent directors
same with regulation of the SEC and the SET. The chairman of the Board
of Directors is not the same person as President and has no relationship
with the managements. This has better enhanced the balance of power
between the Board of Directors and the management. The Company has
clearly separated and defined power and authorities among the Board and
the management team.

The Board of Director is responsible for overseeing the Company’s
operation to comply with Laws, the Company’s objective and rules, as
well as the resolutions of the shareholder meeting with honesty while
preserving the company’s interests. The term of the Board of Directors
has been clearly prescribed in the Company’s rules, which states that
one third of the directors who has longest term, has to retire by
rotation but can be reappointed if eligible.

Referring to the Principles of Good Corporate Governance which suggests
that each director should not serve not more than 5 Boards of listed
companies; however, one director of the company, Mr. Prakit Padipasen,
serves more than 5 Boards of listed companies. Nevertheless, from his
past performance, he has attended the meeting every time as the
independent director and audit committee member of the company, used his
knowledge, competence and devoted time to perform the responsibility
competently and efficiently.

The company has established the system to monitor the operation of its
subsidiaries, the direction for its subsidiaries, the direction to the
person the company assigned to be the director or management executive
and the reporting to the Board of Directors to ensure that the Company
could monitor the operation of its subsidiaries.

  Company Secretary

The Board of Directors has appointed Company Secretary to provide advice
on any laws, regulations, and procedures that the Board of Director has
to follow. The Company Secretary is also responsible for the Board of
Directors’ meeting, shareholders’ meeting, compliance of relevant laws
and regulations on the information disclosure.

5.2 Committees

The company has established the Audit Committee whereby the term of
directors is 3 years. The Audit Committee consists of 3 independent
directors, who are qualified according to the regulations of the SET and
all members have knowledge and experience in accounting and finance,
with a term of 3 years.

In the year 2013-14, the Audit committee held 5 meeting. The name and
attendance of each member was presented in Annual Report. Mr. Prabhat
Gupta, CFO serves as the secretary of the committee.

Even though the Company has not set up other committees besides the
Audit Committee, which are to be established in compliance with the
regulations of the SET, all of the company’s practices in other areas
such as determination of remuneration and election of directors are
carried out in a careful, transparent and honest manner.

5.3 Role, Duties and Responsibility of the Board of Directors

The Board of Directors plays a very important role in establishing the
company’s vision, mission and business strategies and also in ensuring
compliance of the same efficiently and effectively for the overall
benefit of the company and to its shareholders. In addition the Board
establishes internal control systems and internal audit function and
constantly monitors them though meetings of the Audit Committee.

The Board of Directors has established written corporate governance
policy and a Code of Business Ethics (See details under the section
“Corporate Governance” in part of Shareholders’ rights) and monitors
compliance of the same consistently.

The Company’s Board of Directors has established guidelines for the
careful consideration of transactions involving possible conflicts of
interest for the Company and its shareholders, whereby anyone having an
interest in an agenda item must disclose such interest to the meeting,
and foregoes the right to take part in taking a decision on that item.

The company places utmost importance on the system of internal control
and internal audit for optimal performance and transparency of
operations, reduce risk and to prevent or reduce losses that may occur
to its operations. The Company’s Board of Directors has entrusted Audit
committee for supervision and to oversee the implementation of internal
control systems.

The report of the internal audit team is fully discussed with audit
committee for its views and opinion and for the compliance of the same.
The above framework helps to achieve independent compliance, control and
ensures that the main operations and important financial activities of
the company are conducted according to the laid down policies, and rules
and regulations

5.4 Board of Directors’ meeting

The Board conducts its meeting at least once every three months and the
meeting are scheduled in advance with notice circulated to all the
directors at least 7 days in advance. During the meeting, the chairman
of the meeting encourages prudent consideration and allocate appropriate
time for the management to present adequate issue and enough data for
the directors to broadly discuss important matters. Directors can
express their opinions openly and freely. A written record is made of
each meeting and, once the minutes have been approved by the Board, they
are kept available for directors and other concerned parties to examine.

5.5 Assessment of Board’s Performance

The Company’s Board of Directors has not so far set up a system for
assessing the Board’s overall performance nor its performance in
specific areas, nor for regular self- assessment by the Board. The Board
will give consideration to these matters in due course.

5.6 Remuneration

The remuneration to directors and audit committee members is the meeting
fee which is appropriate, transparent and in accordance with company’s
Articles and Association and as approved by the meeting of shareholders.

The remuneration for management is determined in accordance to the
policies of the company, which corresponds to the performances of the
company as well as that of each individual and is appropriate to their
position and responsibilities

The amount of fee and remuneration paid to directors, audit committee
and senior management is separately disclosed in the Annual Report and
form 56-1 under the section remuneration to Directors and the management

5.7 Board and Management Training

The Company’s director attended Directors Certification Program run by
the Institute of Directors (IOD). At present, 3 out of 5 local directors
have attended the program which is 60% of local directors.

.

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| 9.  Corporate Social Responsibility                                   |
+-----------------------------------------------------------------------+

The company activity promotes, sponsor and participates in health,
sports, educational, cultural and religious events, as well as other
social activities for the benefit of its employees and the community at
large.

The company operates the production process with great care and
responsibility to all stakeholders and strictly follow the regulations,
law and international standard as a good governance company.

To achieve in sustainable development in Economy, Society and
Environment, the company fully performs its duty as a good corporate
citizen and encourages its employees to contribute to community in
different kinds of social activity :-

1.  Support and organize Children Day for children surrounding
    community.

2.  Support young children program to realize their potential and
    capability in education and sport.

3.  Support foundations and charity organization for helping and
    creating better opportunities in Society improve quality of life
    such as Rally Dharma, OTOP Activity, Red Cross Society.

4.  Songkarn Festival “Pouring Water to Senior Persons” encourage
    employee and people respects to their elders in community nearby.

5.  Gave scholarships to employees’ children and children of nearby
    community.

6.  Support Basketball Team of Satri Angthong School for Competition at
    National Level.

7.  Health Check-up for Community.

8.  Support Buddhism activities of the temple surrounding community.

9.  Support Football match for Anti Drug campaign of the community

10. Lunch for Student at the School surrounding community

11. Support flood victims in Angthong ( Sub-district of Jampalor and
    Posa )

12. Purified Drinking Water to community.

Thai Carbon Black – Corporate Social Responsibility Framework

[]

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| 10. Internal Control                                                  |
+-----------------------------------------------------------------------+

The company recognizes the importance of internal control and emphasize
in particular that it is adequate, appropriate and bring efficiency in
business operations. The Board entrusted Audit Committee with
supervision and overseeing the implementation of internal control
systems and internal control activities, to ensure that the main
operations and important financial activities of the company are
conducted according to the laid down policies, and rules and
regulations. In additional to this the corporate audit division of the
head office of the company performs the internal audit of all the
important functions and activities of the company. The reports of
internal auditors are put up and all important point are discussed with
Audit Committee. The management gets the opinion of the Audit Committee
on various internal control measures and on audit observations. The
relevant important sections of internal control are as follows:

1.  Organization and Environment

The company promotes and encourages an appropriate internal control
environment. The organization chart is clearly defined with roles,
responsibilities, corresponding skill matrices, and delegation of
authority. Business ethics policy of Aditya Birla Group has been adopted
by the Company. The policy is periodically communicated to all the
employees and signed by them as an understanding and commitment to
follow. The company has developed employee accountability through “SOP”
(Standard Operation Procedure) to ensure employee follow SOP to maximum
effectiveness of work.

2.  Risk Management

The company recognized the importance of risk management which the
company has a systematic method of risk identification, impact
assessment, and mitigation. A committee of senior executives supervises
risk management. Also the audit committee of Board reviews various risks
associated with the business and advices management from time to time
about the appropriateness of the company’s risk management policies and
measures as well as monitoring of risk mitigation plans to ensure that
those risks are managed and remain at an acceptable level.

3.  Control Activities

The Company gives attention to the control activities that are in line
with acceptable risk and suitable for business conditions. The control
activities are spread through policies, standard procedures, reviews,
audits, and corrective/preventive action plans. This framework is
periodically reviewed to keep current with changing business conditions
and technologies. The Company runs its accounting and information
systems on SAP. The control framework is integrated in the SAP
accounting and information system. The company also encourages its
employees, through periodic communications, to follow the control
activities. The operating results of the company are reviewed in detail
at various levels up to the Board of Directors.

4.  Information technology and communication systems

The company has set up external and internal communication controls on
information and communication to ensure the information is accurate,
complete, timely and of high quality. The Company has an IT security
policy for maintaining security and confidentiality of the information.
Employees are periodically educated about use and maintaining security
of IT systems.

5.  Monitoring System

The Company continues to monitor and evaluate the effectiveness of
internal control environment. There is a regular internal audit program,
which is aligned to risk assessment. The audit includes not only
effectiveness of the control environment but also on efficiency of
operations. The management conducts Bi-weekly review meetings of all the
functions on standard operating procedures. The Board of Directors and
Audit Committee regularly review the internal control environment and
effectiveness. The Board of Directors and Audit Committee have, in
meeting on 22^(nd) May 2014, reviewed the appropriateness and
sufficiency of the internal control and are of the opinion that the
Company has good internal control system, which is adequate and
reliable, and is sufficient to control and mitigate the risks associated
with the running of normal business operations.

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| 11. Related party and Connected Transactions                          |
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The Related parties and transactions with them

The connected transactions are transaction between the company, its
associated companies or related companies which have same major
shareholder and / or have common directors or owners.

Connected transaction:

1.  Corporate guarantees for related company’s credit facilities

The company has given undertaking for a maximum amount of US$ 4.6 million to the two overseas financial institutions to obtain various credit facilities by M/S Alexandria Fiber S.A.E., Egypt. 

The Company owns 14.40% of Alexandria Fiber S.A.E., Egypt. Thai Rayon Pcl, which owns 24.98% of Equity shares of Thai Carbon Black Pcl, also owns 14.40% of Alexandria Fiber S.A.E., Egypt. 

Rationale of transaction

Company provided guarantee to AFCO in proportion of its shareholding in
the company. The transaction was approved by the Audit Committee and the
Board of Director also and it is a normal requirement for Banks /
Financial institutions to ask such guarantee from the major shareholder
for financing the project.

2.  Sale of steam & power

Thai carbon black Pcl is having the transaction of selling electricity
and steam to Thai Rayon Pcl., which is generated from the waste heat
gases generated during its process of manufacturing of carbon black.

Thai Rayon Pcl, owns 24.98% of Equity shares of Thai Carbon Black Pcl.

Rationale of transaction

The company sells electricity and steam which is generated during the
process of manufacturing of carbon black to Thai Rayon Pcl, in the
normal course of business. The electricity selling price is based on PEA
electricity selling price and steam selling price is based on energy
value of steam linked with PEA electricity selling price. The audit
committee reviewed the transaction and considered this transaction as
normal business transaction with underlying market price and selling
price as reasonable.