TRUE : Annual Report 2007 by True Corporation Public Company Limited

02 04 16 20 26 36 40 46 50 59 60 69 70 71 77 78 79 112 119 120 122 123 124 125 126 141

At a Glance Financial Highlights Message from the Chairman Message from the President and CEO Segment Solutions Social Responsibility Company Background and Major Development and Awards Independent Directors Corporate Governance Compliance Report Revenues Breakdown Corporate Information Investment Structure of True Group References Risk Factors Shareholders Dividend Policy Management Connected Transactions Audit Fees Report of the Audit Committee for the Year 2007 Report of the Compensation and Nominating Committee for the Year 2007 Report of the Corporate Governance Committee for the Year 2007 Report of the Finance Committee for the Year 2007 Report of the Board of Directorsâ&#x20AC;&#x2122; Responsibilities for Financial Statements for the Year 2007 Managementâ&#x20AC;&#x2122;s Discussion and Analysis Financial Statements

02 04 16 20 26 36 40 46 50 59 60 69 70 71 77 78 79 112 119 120 122 123 124 125 126 141

About

Activities

Social Responsibility

For 17 years, True Corporation Plc has consistently promoted social development through various activities, especially projects related to education and the environment affecting children and young people. In 2007 True launched its Plook Panya (“Planting Wisdom”) project, extending its Corporate Social Responsibility (CSR) activities. True is committed to effectively spreading knowledge and education to the nation as well as enabling Thais to access new knowledge that will inspire lifetime learning, leading to self-development and self-reliance, and ultimately to national development.

ANNUAL REPORT 2007

True’s President and CEO, Mr. Suphachai Chearavanont, expresses it this way: “True’s mission and societal responsibility is to use its lifestyle convergence strategy and telecommunications technology to help Thailand become a knowledge-based society.”

Plook Panya will allow children and young people to access information and knowledge more widely and more quickly via television, an easily accessible media providing images and sound, as well as bringing together all education platforms to support teaching in schools To celebrate the Auspicious Occasion of His Majesty the King's 80th Birthday Anniversary on December 5, 2007, True launched a major initiative under Plook Panya, “Opening the educational world view to 800 schools”. This involved presenting TrueVisions’ satellite dishes and other equipment, along with carefully chosen educational content on TrueVisions’ channels, to rural schools nationwide. This will help Thai students broaden their world view by accessing information, knowledge and entertainment to the same degree as their global counterparts. True has committed to expanding this project and completing its installation in 10,000 rural schools nationwide. The project is not just about installing TrueVisions but also about providing schools with a wide range of teaching materials.

BETTER TOGETHER 37

This reflects True’s belief that knowledge-based societies consist of two elements: 1) A basic infrastructure or foundation requiring a combination of wireline and wireless technology; and 2) High-quality content that will inspire us all. If children are inspired and given the opportunity to learn using high-quality content, the final outcome will be a genuine knowledge-based society. As well as activities that help create a knowledge-based society, True each year will promote a new theme for learning activities based on current global issues. In 2007, Plook Panya’s focus was educating people on the “Global Warming Crisis” uppermost on national and global agendas, striving to encourage mutual collaboration to reduce global warming using two activities: • A True Youth Camp for high school students called “Preventing Global Warming” • The True Young Producer Award, requiring university students to make a television commercial with the theme “Helping Reduce Global Warming”. The Youth Camp brought together leaders from senior high schools to be trained and educated on global warming. They then returned to their schools and initiated projects on reducing global warming, passing on their knowledge and awareness so that everyone becomes aware of the problem and tries to find ways to counter it.

ANNUAL REPORT 2007

The True Young Producer Award 2007 aims to identify advertising novices interested in advertising motion picture production. University students nationwide can participate in the contest, which focuses on the global warming issue. The winning film will air on TrueVisions. The aim is to encourage Thais to be aware of and understand the crisis which has direct negative impacts on society, present and future, and to try to work together to resolve the issue. In addition, other projects, activities and initiatives under Plook Panya benefit all of True’s stakeholders, including customers, employees and public. These include: • Nature Conservation Photography Contest “Precious Wildlife and Valued Forest” • True Young Scientist Award • Scholarships for Employees’ Children • Student Internship Program True takes its responsibility for helping Thailand develop into a genuine knowledge-based society very seriously. Plook Panya is a key part of this commitment, promoting knowledge and education as well as providing children, young people and all Thai people with access to new knowledge that will inspire a lifetime of learning. This, in turn, will lead to self-development and self-reliance, and ultimately to national development.

BETTER TOGETHER 39

Insight

True Success

Company Background

and Major Developments and Awards True Corporation Public Company Limited is the most integrated communications solutions provider in Thailand. We were incorporated in November 1990, and registered as a public limited company in 1993 under our former name, TelecomAsia Corporation Public Company Limited. We began trading on the Stock Exchange of Thailand in December 1993 with the security symbol “TA”. In April 2004, we rebranded under the ‘‘True’’ name and adopted the security symbol “TRUE” with registered and paid-up capital of Baht 45.032 billion at the end of 2007. True is now one of the strongest brands in Thailand. True’s vision is to be the leader in convergence lifestyle. True’s mission is to bring knowledge, information, entertainment, and the ability to access each others’ values, to every household and the youth of Thailand as well as to create value for our organization, employees and shareholders. Our convergence lifestyle strategy differentiates True from other operators by providing a full range of communications solutions drawing on rich content to meet every customer’s lifestyle needs.

ANNUAL REPORT 2007

Backed by Asia’s largest agro-conglomerate, the Charoen Pokphand Group (“CP”), with a shareholding of 30.02 percent as of December 2007, we have expanded our business from being a fixed-line provider to a total communications solutions provider, offering consumers, small and medium enterprises, and corporations a full range of voice, video and data services in solutions customized to meet their needs. We are Thailand’s largest provider of Internet, broadband Internet and pay-TV services, as well as the largest fixed-line service provider in the BMA, a leading online game provider and the number three mobile phone operator in Thailand. We operate five core businesses: • Mobile phone business under TrueMove (formerly TA Orange); • Online business under TrueOnline, which consists of fixed-line phone service and its value-added services, business data services, Internet and broadband Internet services and WE PCT (Personal Communication Telephone); • Pay-TV business under TrueVisions (formerly UBC) • Digital commerce business under TrueMoney; • Digital content business under TrueLife (as well as lifestyle venture True Coffee).

We provide fixed-line phone services under a build-transfer-operate (BTO) concession with TOT Corporation Public Company Limited (TOT) to build, install, jointly operate and maintain a 2.6 million-line wireline network in the BMA for a period of 25 years, ending on October 2017. We received our first revenue from the operation of our wireline network in November 1992. We received additional approvals to provide value-added, public phone and other services, and launched our WE PCT service in 1999, hi-speed data transmission services including ADSL and cable modem in 2001, and Wi-Fi services in 2003. After we were granted the licenses from the NTC, in 2007 we launched international Internet gateway service and soft-launched international direct dialing service. In October 2001, we acquired a 41.1 percent equity interest in Bangkok Inter Teletech Public Company

Limited (“BITCO”) (the parent company of TA Orange) expanding our business in the mobile sector. Full commercial launch of TA Orange’s mobile telecommunications service in Thailand took place in March 2002. TA Orange was rebranded “TrueMove” at the beginning of 2006. We gradually increased our shareholding in BITCO until at the end of 2006 we owned 93.4 percent. In December 2007 a rights offering of BITCO shares to CP left True’s shareholding in BITCO at 75.3 percent, with CP owning 23.9 percent. True’s shareholding will increase to 98.6 percent if True purchases these shares from CP via options given by CP for an 18-month period from the rights offering, pending True’s shareholders’ approval.

TrueMove operates a digital mobile telecommunications network based on the GSM (Global System for Mobile telecommunications) standard in the 1800 MHz frequency under a BTO concession with CAT Telecom, which is due to end in September 2013. In January 2006, True purchased UBC shares from MIH and completed the tender offer for UBC shares held by the public in March 2006, allowing True to own 91.8 percent (effective holding) of UBC. True started to fully consolidate UBC’s results into True Group from the first quarter of 2006. UBC was renamed TrueVisions at the beginning of 2007. TrueVisions operates pay-TV services under a 25-year concession contract with the Mass Communications Organization of Thailand which is due to end on September 30, 2014 for services via satellite and on December 31, 2019 for services via cable.

From 2005 to 2007 True Group received licenses from the NTC to provide Internet service, Internet service via telephone or VoIP (Voice over Internet Protocol), public phone services, fixed-line phone services, international direct dialing and, international Internet gateway services. We were also granted one-year trial licenses for International Private Leased Circuit (IPLC) and International Internet Protocol Virtual Private Network (IP VPN) as well as a six-month trial for WiMax. At the end of 2007, True Group had an annual turnover of Baht 61.6 billion (including interconnection charges), infrastructure investments of Baht 124.7 billion, and employed 10,224 permanent staff.

Major Developments in 2007 • True launched the Plook Panya (“Planting Wisdom”) project, which will ultimately involve providing educational programs on TrueVisions to 800 schools nationwide. The project is part of True’s efforts to help develop a knowledge society in Thailand. • True placed Baht 4 billion of secured debentures with Thai institutional investors and the public. Proceeds were used to prepay existing debt ahead of maturity date. • In July, TrueMove placed USD 225 million of seven-year bonds with international investors. Proceeds were used to repay debt with Thai financial institutions and to extend overall debt maturity profile. • In October, True’s Chief Financial Officer, Mr. William Harris, announced his resignation. He was replaced, effective January 1, 2008, by former Deputy CFO, Mr. Noppadol Dej-Udom. • In December, CP provided an extra Baht 3 billion to fund TrueMove’s ongoing growth by way of a rights offering of six billion shares. True Corp retained the right to buy back the shares within 18 months after the rights offering. TrueMove • TrueMove entered into Interconnection (IC) regime and started to charge IC with DTAC and AIS early in the year. • Several non-traditional distribution channels were introduced including: - Thailand’s first public phone top-up service, offering subscribers the convenience of micro top-ups at 18,000 phone booths in the BMA.

ANNUAL REPORT 2007

- One hundred “Move Up Vans” as nationwide mobile sales points offering all True products and services. - The facility for post-paid subscribers to pay their monthly bills free-of-charge and without needing to show their statements at more than 3,800 7-Eleven stores nationwide. • A Wi-Fi roaming deal was signed with international broadband connectivity provider iPass. • The “TrueMove, Let’s Try It” nationwide advertising campaign was launched, fronted by popular Thai comedian Mr Pettai Wongkhamlao (“Hmom Jokemok”). The campaign highlights TrueMove’s competitive edge in network quality, value-formoney, access to TrueVisions’ programming, bill payments and EPL mobile access. • The passing of the 12 million subscriber mark was celebrated during Q4. TrueOnline • “SUPER hi-speed Internet” was introduced in February 2007, offering a market-leading speed of 1 Mbps. By the end of the year the promotion had attracted more than 254,000 subscribers. • Our second Internet Data Center, at Muang Thong Thani, was opened, offering integrated network and data services. • True’s MPLS Data Networking Solution, IP Telephony (IP PBX) and Managed Security services become the first Thai recipients of the “Cisco Powered” designation, acknowledging the international quality of our networks.

• We launched in February 2007 an international Internet gateway service. By the end of 2007 True Internet Gateway had achieved a 20 percent domestic market share of the rapidly growing international ISP market. • We “soft” launched in December 2007 our international direct dialing (IDD) service, which uses the “006” prefix. TrueVisions • The name was changed from UBC-True in January 2007, emphasizing TrueVisions’ important role within the Group’s overall convergence strategy. • Subscribers were offered more content choices, with greater flexibility, through:

- The introduction of international channel packages, offering A-La-Carte choices from HBO, Discovery and Disney. • We continued to progress our mass market campaign, Free View, launched in July 2006. The initiative, which provides cheap access to all free-to-air channels and eight TrueVisions’ channels, has proven to be an inexpensive and effective way of broadening the pay-TV market. • The fourth season of reality show Academy Fantasia (AF4) proved highly successful, providing various viewing channels and special privileges such as free SMS for TrueMove subscribers, which aided in mobile customer retention. Voting was 50 percent higher than in 2006.

- The acquiring of exclusive Thai-market rights to three seasons of live television broadcasts of English Premier League (EPL) football. EPL-related content is also provided through multimedia platforms including IPTV, TrueMove and Broadband. - The unveiling of TrueSport – a package of leading sports channels, including new channels to accommodate extra EPL games.

BETTER TOGETHER 43

TrueMoney • TrueMoney Express was launched, offering free, no-statement-required bill payment services through franchises and True partners nationwide. • We announced the development of the world’s first intelligent contactless mobile payment system. Developed with China’s Watchdata Technologies Co., Ltd., the system uses a TrueMoney RFID (radio-frequency identification) SIM and will be implemented in 2008.

TrueLife • TrueMusic was officially launched, offering music and music-related products and services (many of them on an exclusive basis) across True Group’s multimedia platforms. Specific initiatives included collaboration with GMM Grammy Music, proving True customers access to multimedia content via www.truemusic.com and wap.trueworld.net, and exclusive access to new music. • Website portal, truelife.com, passed 1.3 million combined registered subscribers, more than a million higher than a year ago. They represent the early stages of online community development. • Online shopping service, www.weloveshopping.com, was launched, featuring more than 600,000 products and services. The site is one of Thailand’s most popular online shopping destination. • Special Force, Thailand’s number one casual online game, passed nine million registered subscribers. The game is a leading example of the rich content TrueLife offers across various Group platforms – in this case True Broadband.

ANNUAL REPORT 2007

Awards received in 2007 • True’s “The Miracle” TV commercial won a Mental Health Media Award from the Department of Mental Health, Ministry of Public Health.

• onTM TrueLife won a Merit Award – media and entertainment category, in the Asia Pacific ICT Alliance Awards.

• True’s “I Will Do” TV commercial won Best Award (Honor The King category) in the Adman Awards & Symposium, organized by the Advertising Association of Thailand. “The Miracle” won the Silver Award (telecommunication, business equipment & services category) in the same contest.

• True’s online Shark Hunter Game won a Silver Award in the interactive/website category in the Thai Direct Marketing Association Awards organized by the Thai Direct Marketing Association.

• TrueTouch Co., Ltd. (Nok Air project) was named Best Outsource Call Center by the Call Centre Industry Association of Thailand. • onTM TrueLife won First Prize in the Thailand ICT Awards – media and entertainment category, organized by the ICT Ministry, the Software Industry Promotion Agency and the Association of Thai ICT Industry.

• True Digital Entertainment’s Cool Game program, broadcast on TrueVisions’ GSquare channel, received the Royal Thepthong Award (radio and television category) as the outstanding program for youth, from the Broadcaster’s Association of Thailand under the Royal Patronage of HM the King.

BETTER TOGETHER 45

Corporate Governance Report

In 2007 the Company carries out its business according to the Principles of Good Corporate Governance for Listed Companies 2006 issued by the Stock Exchange of Thailand (SET). The first Good Corporate Governance guideline was issued on March 2002, then fine tuned and modified by the SET in order to be in line with the Organization for Economic Co-operation and Development (OECD) and World Bank suggestions from its corporate governance project called Reports on the Observance of Standards and Codes (CG-ROSC). True’s good corporate governance practices are summarized as follows: Corporate Governance Practice

True has two levels of corporate governance oversight; by the Board of Directors and by management. The Board of Directors has established the Corporate Governance Committee which comprises Mr. Narong Srisa-an, Mr. Vitthya Vejjajiva, Dr. Kosol Petchsuwan, Mr. Joti Bhokavanij, Mr. Jens B. Bessai and Dr. Ajva Taulananda. Corporate governance at management level is overseen by the CEO and other senior executives. Section 1 Rights of Shareholders 1. The Board of Directors has established a corporate governance policy that takes into account – as much as possible – the rights of shareholders, without being limited to the rights specified only by law. The Board of Directors has approved and implemented the new Corporate Governance policy which has been amended to be in line with the Principles of Good Corporate Governance for Listed Companies 2006 issued by the Stock Exchange of Thailand and combined with the concept of Sufficiency Economy. 2. In the year 2007, the Company held two shareholder meetings, the Annual General Meeting of the Shareholders (the “AGM”) for the year 2007 on April 24, 2007 and the Extraordinary General Meeting of the Shareholders No. 1/2550 on July 16, 2007. For the convenience of shareholders, the meetings were scheduled on a working day during working hours at 2 pm and held in Bangkok where transportation is convenient. 3. The Company will send shareholders an invitation letter to inform them of dates, times, locations, meeting agendas and the background to issues which shareholders are being asked to vote on, and rules and regulations for the meeting and its voting processes. This information is provided to shareholders in the notice of meeting in accordance with the legally required advance period. Information is explained in detail so a reader who has no background knowledge of the topic will still be able to easily understand it. All information regarding shareholder meetings has been posted on the Company’s website around 3-4 weeks in advance before notice of the meetings is sent out, so that shareholders can study all information prior to receiving the notice. 4. The Company’s policy prohibits any action that could be considered to violate a shareholder’s right to access information on the shareholder meeting. Shareholders can make advance inquiries about information

ANNUAL REPORT 2007

they do not understand or submit advance questions to the Company’s Investor Relations Department on 0-2699-2515 or to the Company Secretary Department on 0-2643-0076. 5. To encourage attendance at shareholder meetings, the Company provides free-of-charge refreshments and snacks for shareholders before and after meetings as well as souvenirs. The Company encourages shareholders’ participation and voting in meetings at no charge. Any action that could be considered to violate their right to attend meetings is prohibited. The Company has streamlined its procedures for attending and voting at meetings. The chairman of the meeting ensures there is appropriate time set aside for discussion and encourages shareholders to express their opinions and ask questions related to the Company’s operations. Moreover, after the meeting directors meet with shareholders in person and provide them with an opportunity to ask any questions they may not want to ask during the meeting. Section 2 Equitable Treatment of Shareholders 1. The Company allows shareholders who cannot attend meetings to cast a proxy vote. Shareholders must submit a proxy form to the Company Secretary Department before the meeting so it can be verified. 2. The Company encourages the use of proxy forms on which shareholders can specify their voting preferences. The proxy forms are attached together with the invitation letter to the shareholder meeting. The Company provides options for shareholders to appoint the Chairman of the Audit Committee, who is an independent director, or an independent director as their proxy (with their background information provided). 3. The Company allows minority shareholders to propose any issues to be added to the meeting agenda as well as submitting nominations for directors before the 2007 AGM by using the form provided by the Company and sending it by registered mail to the Company from December 1, 2006 to January 31, 2007. The Company posted the above proposals on its website and through the SET’s electronic media. Nevertheless, shareholders did not propose any issues or nomination for directors. 4. For the sake of transparency and historical record, the Company encourages the use of voting cards. The Company also arranges for an independent law office to verify the vote counting. The voting cards will be kept as evidence if there is any argument after the meeting. 5. The Company allows shareholders to vote on individual nominees. 6. The Company’s code of conduct covers inside information and insider trading, as well as the use of applicable laws to monitor and prevent the personal use of confidential Company information by management and related persons. Material information which has not yet been disclosed is kept confidential, apart from disclosure to the relevant senior management of the Company. Directors and senior management must report purchases, sales, transfers and assignations of securities issued by the Company to the Securities and Exchange Commission (“SEC”) within three days of the transaction’s execution, and provide a copy of this report to the Company for its records and incorporation in its regular report to the Board of Directors. In the year 2007, there were no Board members or executives violating this practice. 7. In the year 2007, there were no Board members or executives violating the rule on conflict of interest in proposed Company transactions. BETTER TOGETHER

8. The Company has measures and procedures for approving the entering into connected transactions in compliance with the Rules and Regulations of the Office of Securities and Exchange Commission (“SEC”) and the Stock Exchange of Thailand (“SET”) i.e. related party transactions must obtain approval from the Independent Directors to be processed according to the internal procedure relating to related party transactions, details of which have been stipulated by the Independent Directors. If any related party transaction is deemed to be a connected transaction, the said transaction must be approved by the Audit Committee, the Board of Directors and/or Shareholders Meeting – as the case may be – according to the Regulations of the Stock Exchange of Thailand. In the year 2007, the Company strictly followed the above rules and regulation. All connected transactions that occurred in the year 2007 have been disclosed in its annual report and annual registration statement (Form 56-1) under the Topic “Connected Transaction”. The Company has also established an Independent Committee to take part in monitoring highly significant connected transactions. This committee comprises independent directors, creditor-nominated directors and directors representing major shareholders. If any major shareholder has a conflict of interest, directors nominated by this shareholder will abstain from the Independent Committee meeting to consider the case. Section 3 Role of Stakeholders 1. The Board of Directors recognizes the importance of acknowledging the rights of all stakeholders and their ability to positively influence the Company’s conduct and activities, and vice versa. Accordingly, the Company has established a “Code of Conduct” covering employees and stakeholders which includes: Employees - The right to privacy and the right to be protected from any violation of that privacy - The right to receive fair and equal treatment - The right to fair and equal employment rights such as the right to take leave and to receive fringe benefits, and the opportunity to be promoted, to transfer to other work units, and to receive performance assessments Customers - The right to receive fair and equal treatment - The right to receive full and efficient service from the Company’s employees - The right to receive quality goods and highly efficient service - The right to protection of confidential information Suppliers and dealers (business partners) - The right to fair and equal treatment - The right to protection of confidential information - The right to be treated honestly and reliably - The right to information on relevant laws, regulations and policies - The right to fair competition Creditors - The right to be treated honestly in accordance with terms and conditions of all agreements under relevant law and regulations - The right to receive correct and complete financial information - The right to receive payments owing, as well as safeguarding all guaranteed assets given as security Investors - The right to receive fair and equal treatment

ANNUAL REPORT 2007

- The right to be treated with the best intentions of the management to operate the business with their best knowledge, skills, and honesty - The right to be protected from the use of insider information for pursuing private interests Government agency - The right to regulate, monitor and punish according to laws and regulation and the government agency’s standard practice. 2. The Company’s Internal Audit Department reports directly to, and is accountable to, the Audit Committee. The Company provides opportunities for its employees to address their concerns directly to this department or the Audit Committee. 3. The Company operates its business while taking into consideration environmental and social matters and is focused on promoting a knowledge-based society as a path to sustainable development for Thailand. The Company uses modern telecommunications technology to develop educational projects which help with the development of youth and underprivileged children in Thai society. A knowledge-based society offering a better quality of life is an important foundation for ensuring Thailand’s future prosperity. Social Responsibility Activities 2007 - Helping the young: True presented gifts and sports equipment to children at Sanprasert community on Children’s Day. - Rural education: True donated toothpaste and toothbrushes, luncheon funds and books and stationery worth more than Baht 79,000 to students at Ban Sam Jampa in Khon Khaen province. Also, True provided lunch, education material and sports equipment to students at Prathomvittayakarn in Ayutthaya province. - Helping the elderly: True presented money and necessities to Banglamung Social Welfare Development Center for Older Persons, Chonburi province. - Telecommunications education: True opens the telecommunications world to young students, hosting a visit to True Tower by 40 youngsters from Kasempittaya kindergarten. - 12V: 12 Good Deeds for the King: True encouraged its employees and the public to sign up as eye donors with the Thai Red Cross under True’s “12V: 12 Good Deeds for the King” project. True employees and Academy Fantasia fan club members were also urged to help mangrove reforesting in Samutsakorn province under the same project. - Mental Health: True’s “The Miracle” TV commercial led into the production of TV programs on Channel 9 to help people in society. The TV commercial proved very popular, and won a Mental Health Media Award from the Department of Mental Health, Ministry of Public Health. - Bike for Peace: True supported the “Bike for Peace”, promoting environmental preservation and human rights, led by Dr. Kristian Bo (True employee number 001) and the Norwegian biking team. True Tower was the starting point. - Renovation of Pramaiyikavas Temple: True renovated and painted Pramaiyikavas Temple’s fence, creating a beautiful view from the Chao Praya River. - 13th Nature Conservation Contest “Precious Wildlife and Valued Forest: True joined with the National Park and Wildlife and Plant Conservation Department, and the Ministry of Natural Resources and Environment, to raise youth awareness of natural and environmental preservation. The photo “Leopard” won the first prize. - Animal rights: True sent representatives to join the competition on Saint Game program broadcasts on TrueVisions’ GSquare channel and won the prize plus cat and dog food. The team donated BETTER TOGETHER

the prize to the Home for Handicapped Animals Foundation (under the auspices of Luang Ta Maha Bua). National Science project: True opened the National Science project competition (primary school level) 2007, joining with the Thai Association of Science & Technology Education. Support for Thai soldiers: True’s Special Force online game launched the “SF cares for Thai Soldier” campaign inviting the public to send postcards to Thai soldiers based in the three southern provinces. True donated money according to the postcard costs to support the Supreme Command Headquarters. Rural education: True’s representatives visited the Rural Lives Development Foundation in Petchaburi province to be briefed on the progress of students who received scholarships from the foundation, and to find out how to help them further. Plook Panya project: True launched the “Plook Panya” project, which will ultimately involve making easily-accessible sound and vision-based educational programs on TrueVisions available to more than 800 schools nationwide. True will pay for the installation of the satellite dish and other equipment His Majesty’s Birthday: In December, His Majesty celebrated his 80th birthday. True’s directors, management and staff shared in the nation’s pleasure, and took the very visible step of decorating the outside of our head office, True Tower, to mark the occasion as well as wearing pink wrist bands and giving the wrist bands to customers to celebrate and pay gratitude to His Majesty the King. Let Them See Love: To emphasize the true meaning of love during the month of Valentine, True invited the public to donate their eyes and organs to the Thai Red Cross Eye Bank and the Thai Red Cross Organ Donation Center. This was under the auspices of doing good deeds for His Majesty the King on the 60th Anniversary Celebrations of His Majesty Accession to the Throne and His Majesty The King’s 80th Birthday Anniversary. TrueVisions’ rural education: TrueVisions established the Learning Room with TrueVisions under the “TrueVisions … makes students’ dreams come true” project. This provided education materials and equipment, computer rooms with Internet access, stationery and sports equipments to students in rural areas. Science camp: True and the National Science Museum held a science camp for students in the three southern provinces to give them the chance to broaden their science knowledge. Robot building: True joined Technology Street 2007 to help create a Thai robot-building team. “Beautiful Internal Phone Cable” project: True went onsite under the “Beautiful Internal Phone Cable” project to check and fix internal phone cable for fixed-line customers in the BMA, as well as checking ADSL cabling and performance free of charge. University entrance examination tutoring: True supported the “Tutor for Entrance” project, helping more than 55,000 students prepare for university entrance examinations. Four major tutor locations at Thai Chamber of Commerce University, Chiang Mai University, Khon Kaen University and Walailak University, as well as other small locations in 100 schools nationwide, used live broadcast technology from True for six days. Pirab Noi journalism project: True held the 10th Young Journalism (Pirab Noi) Project, a joint effort between True and the Thai Journalism Association (TJA), as well as holding the 5th Saifa Noi project with the Thai Broadcast Journalists Association, supporting students studying mass communications. To help alleviate labor shortage in the telecommunications industry: True has since 1993 joined with the Department of Vocational Education to provide training programs and facilities. To date, 179 students have participated in this training program and 212 teachers have undergone training on various telecommunications topics. In addition, a training center has been opened at Donmuang Technical College to accommodate students, teachers as well as True’s staff.

ANNUAL REPORT 2007

The Company is also considering establishing an environmental and social policy and will submit it to the Board of Directors in 2008. Section 4 Disclosure and Transparency 1. The Company discloses financial and non-financial information (as required by SET regulations) accurately, thoroughly, and in a timely and transparent manner through various channels including the SET and the Company’s website, in Thai and English. All disclosed information is updated from time to time. The Company also posts on its website detailed information for analysts and investors such as a graphical summary of financial results showing core business performance, comparative balance sheets, investor news, etc. 2. The Company provides a summary of the Corporate Governance Policy approved by its Board and corporate governance practice through various channels such as the annual report and website. 3. The Company provides a statement of the Board’s responsibilities concerning the Company’s financial report. This statement is presented alongside the auditor’s report in the Company’s annual report. 4. The Company discloses the roles and responsibilities of the Board of Directors and its committees, the total number of meetings and the number of meetings each member attends, as well as the results of tasks performed during the year in the annual report and in shareholder meeting notices, according to SET and the SEC regulations. 5. The Company paid Directors remuneration in the year 2007 according to rates approved by shareholders at the 2007 AGM, which are the same rates approved by the 2006 AGM and which have not changed since 2002. Remuneration of Directors is paid on a monthly basis as follows: Chairman Baht 300,000 per month Honorary Chairman Baht 200,000 per month Vice Chairman Baht 150,000 per month Director Baht 100,000 per month Any Director being an employee of the Company shall receive the Director’s remuneration in addition to his or her salary as an employee. Independent Directors who hold a position on a Committee shall receive remuneration as follows: Independent Directors who is also the Chairman of a Committee Baht 300,000 per month Independent Directors who is also member of a Committee Baht 200,000 per month Remuneration of Independent Directors who are not members of a Committee, and directors who are not Independent Directors shall remain the same 6. In the year 2007, the Company paid senior executives remuneration according to their contributions and responsibilities, commensurate with that paid by other companies in the same industry. 7. The Company discloses details of remuneration of Directors and senior executives, including the nature and amount of payment, in its annual report and Form 56-1. 8. The Company has an Investor Relations Department to communicate with the public fairly and equitably. Investors can contact Investor Relations by phone at 0-2699-2515 or by e-mail at ir_office@truecorp.co.th. In the year 2007, Investor Relations held analyst and investor meetings after the BETTER TOGETHER

Company’s quarterly announcements and also held analyst conference calls after the Company announced major issues and allowed investors and analysts to ask questions of the Company’s executives. The Company also held retail investor meetings by participating in a project to provide knowledge for investors organized by the Stock Exchange of Thailand and the Thai Investors Association. Section 5 Responsibilities of the Board

1. Board Structure 1.1 The Board of Directors consists of four executive directors and 14 non-executive directors. Independent directors make up 22 percent of the total number. The Company has disclosed each director’s background in its annual report and Form 56-1 and on its website at www.truecorp.co.th 1.2 The term of service for each director is clearly stated in the Company’s corporate governance policy and Articles of Association which are in accordance with legal requirements. 1.3 The Company has specified the details of independent directors’ qualifications in its annual report and Form 56-1. Mr. Joti Bhokavanij who serves as the Independent Director and Audit Committee member has an accounting and finance background. 1.4 The Company details the background and position of each member of the Board in its annual registration statements (Form 56-1). Shareholders can download this information from the SET’s website at www.set.or.th or from the Company’s website at www.truecorp.co.th. 1.5 Board policy specifies that directorships held in other companies by the Company’s senior executives must be disclosed to their superiors. 1.6 The Chairman of the Board is a non-executive director and the CEO is not the same person as the Chairman. The roles and responsibilities of the Chairman are in accordance with the law. The roles and responsibilities of the CEO are determined by the Board of Directors. 1.7 The Company Secretary serves the Board of Directors by providing legal advice, helping organize the Board’s activities, and monitoring compliance with the Board’s resolutions. The Company Secretary also meets with counterparts from other listed companies from time to time to discuss best practice. 2. Committees 2.1 As well as the Audit Committee established by the Company according to SET regulations, the Board of Directors has established the following committees to reflect good corporate governance: The Compensation and Nominating Committee is responsible for making recommendation to the Board of Director regarding the compensation of directors and CEO; and the nomination of directors of the Company. The Finance Committee is responsible for assisting the Board of Directors to review and monitor the Company’s financial management. The Corporate Governance Committee assists the Board of Directors to establish and review the Company’s corporate governance policy as well as making sure that the Company has a sound and appropriate corporate governance practice. The Independent Committee is responsible for reviewing and monitoring Company transactions which may involve highly significant conflicts of interest.

ANNUAL REPORT 2007

Shareholders can download the information regarding each committee, such as responsibilities and name lists, from the Companyâ&#x20AC;&#x2122;s website at www.truecorp.co.th. The Company has also specified the details of committee members, numbers of meetings attended and committeesâ&#x20AC;&#x2122; reports in its annual report and Form 56-1. 2.2 So that the committees can perform their duties transparently, independently, and at the same time effectively, their membership comprises independent directors, creditor-nominated directors and non-executive directors. 3. Roles and Responsibilities of the Board 3.1 The Board of Directors reviews and approves key business matters such as the vision and mission of the Company, strategy, financial targets, risks, major plans of action and budget. The Board also monitors the performance of management to ensure their efficiency and effectiveness. 3.2 The Board sets and approves a written corporate governance policy for the Company and reviews the policy and its compliance annually. 3.3 The Board of Directors ensures that a written code of business conduct is in place so that all directors, executives and employees understand the Companyâ&#x20AC;&#x2122;s ethical standards for doing business. Compliance with the code is closely monitored by the Board. 3.4 The Board of Directors considers transactions involving conflicts of interest thoroughly. It follows clear guidelines on approving such transactions so that they are conducted in the best interests of the Company and all shareholders. The person who has an interest in the transaction does not participate in the decision-making process. The Board also monitors compliance with the regulations regarding criteria, procedures and disclosure of transactions involving conflicts of interest. 3.5 The Board of Directors ensures that internal control systems are in place, including financial, compliance and policy controls, and reviews the system at least annually. The Board also assigns the Audit Committee to monitor the independent audit and report on the system. 3.6 The Company runs a risk management system covering operational and financial risk as well as maintaining internal auditing using a risk-based audit approach. To manage operational risk the Company has established the BCP Steering Committee to develop and maintain a business continuity plan. The Company has also established a Crisis Management Team to support significant business operations of the Company which may face a crisis, by implementing and managing a crisis response. To manage financial risk, the Company has a financial management policy to mitigate risks arising from fluctuations in currency exchange rates. This policy includes entering into forward foreign exchange contracts, negotiating payment terms for individual foreign currency settlements, and negotiating with foreign suppliers to share foreign exchange exposure, etc. 4. Board Meetings 4.1 The Company sets its meeting schedule in advance and notifies each director of this schedule. However, in an emergency case the Company can also call for an additional Board meeting. 4.2 In the year 2007 the Company held eight Board meetings respectively which are appropriate to the obligations and responsibilities of the Board and the nature of the Company during the year. 4.3 The Chairman and/or Vice Chairman of the Board and the CEO jointly set the agenda for each Board meeting. Moreover, each Board member is free to suggest agenda items. 4.4 Meeting documents are sent to each director before the meeting. These documents are BETTER TOGETHER

concise but contain all relevant information. Any confidential issues are discussed during the meeting. 4.5 The Chairman of the Board allocates enough time for the meeting to receive full presentations from management and host comprehensive discussions by directors. 4.6 The Board is able to access additional information, under a prearranged agreement, via the CEO, the Company Secretary and/or the executive designated as a contact person. 4.7 Top executives attend Board meetings to detail the issues that they are directly responsible for. 5. Board Self Assessment 5.1 The Board of Directors make self-assessment on a yearly basis. 6. Remuneration 6.1 Board members’ remuneration is commensurate with that of other directors in the Company’s industry, and reflects the experience, obligations, range of work, accountability, responsibilities and contributions of each director. Members of the Board with greater responsibilities, such as independent directors who also hold committee memberships, are paid more. In the year 2007, the Company disclosed the remuneration of each director in its annual report and Form 56-1. 6.2 Remuneration of the CEO and top executives is set in accordance with Board policy, within the limits approved by shareholders (for the types of remuneration that require such approval). Executives’ salaries, bonuses, and other long-term compensation reflect the Company’s performance and that of each executive. 6.3 The Compensation and Nominating Committee appraises the performance of the CEO annually to set his compensation. The basis of the appraisal is agreed upon by the CEO ahead of the evaluation. The criteria are objective, including financial performance, long-term strategic performance, career development plan, etc. The results of the appraisal are then presented to the Board for approval. The Chairman of the Board or a senior director communicates the evaluation results to the CEO. 7. Board and Management Training 7.1 The Company encourages and facilitates training for all internal parties who have a role in corporate governance, including directors, members of the Audit Committee, executives, the Company Secretary, etc. Training – either internal or external – enables them to continuously improve their performances. 7.2 In the year 2007 the Company had two new Directors. To be in line with the Company’s policy, the new Directors received material and information beneficial for fulfilling their duties. The Company also provide an introduction to the Company’s various businesses and business direction for the new Directors.

ANNUAL REPORT 2007

Revenues breakdown Revenues breakdown by business group Business Group 1. TrueOnline 2. TrueMove 3. TrueVisions

2007 Baht Million

2006 (restated) Baht Million %

2005 Baht Million

Revenues

20,490

33.2%

20,791

40.0%

22,143

50.6%

Revenues

32,366

52.5%

22,694

43.7%

21,648

49.4%

Revenues

8,785

14.3%

8,470

16.3%

61,641

100%

51,955

100%

43,791

100%

Total Revenues

Revenues for the year ended 31 December 2007 breakdown by company Business Group / Operation by 1. TrueOnline True Corporation Public Company Limited True Multimedia Co., Ltd. True Internet Co., Ltd. True Leasing Co., Ltd. True Digital Entertainment Co., Ltd. KSC Commercial Internet Co., Ltd. Wire & Wireless Co., Ltd. Asia Wireless Communication Co., Ltd. True Universal Convergence Co., Ltd. True Public Communication Co., Ltd. True Touch Co., Ltd. Others 2. TrueMove BITCO Group of companies 3. TrueVisions True Visinos Group of companies Total Revenues

Baht Million

Revenues

11,621 1,725 1,379 655 1,688 403 380 416 1,435 278 204 306 20,490

18.9% 2.8% 2.2% 1.1% 2.7% 0.7% 0.6% 0.7% 2.3% 0.5% 0.3% 0.4% 33.2%

Revenues

32,366

52.5%

Revenues

8,785

14.3%

61,641

100%

BETTER TOGETHER

Corporate Information True Corporation Public Company Limited (“the Company”), with the security symbol “TRUE” on the Stock Exchange of Thailand, was established on 13th November 1990 initially under the name of CP Telecommunication Co., Ltd. with authorized capital of Baht 1,000 million to undertake a major telecommunication infrastructure project, and registered as a public company limited with registration no. Bor Mor Jor 82 on 11th February 1993. As at 31st December 2007, the company’s authorized capital is Baht 47,515,194,180 consisting of 4,052,183,647 ordinary shares with a par value of Baht 10 per share and 699,335,771 preference shares with a par value of Baht 10 per share. The company’s paid-up capital is Baht 45,031,791,550 comprising of 3,803,843,384 ordinary shares with a par value of Baht 10 per share and 699,335,771 preference shares with a par value of Baht 10 per share. The company’s head office is located at: 18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Telephone: (662) 643-1111 Fax: (662) 643-1651 Website: www.truecorp.co.th The Company’s subsidiaries, associates companies and other investments are as follows: Company Name Address Type of Paid-up Capital % of Business investment Asia DBS Public Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

DBS system operator

THB 100 million divided into 10 million ordinary shares with a par value of Baht 10 each and fully paid up.

89.99

Asia Infonet Company Limited

1 Fortune Tower, 14th, 17th Floors, Ratchadaphisek Road, Din Dang, Bangkok 10400 Tel. (662) 641-1800

Internet provider

THB 15 million divided into 1.5 million ordinary shares with a par value of Baht 10 each and fully paid up.

65.00

Asia Wireless Communication Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

PCT operator

THB 10,441.85 million divided into 1,044.18 million ordinary shares with a par value of Baht 10 each and fully paid up.

99.99

ANNUAL REPORT 2007

Company Name

Address

Type of Business

Paid-up Capital

% of investment

Bangkok Inter Teletech Public Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Holding Company

THB 64.266.70 million divided into 25,706.68 million ordinary shares with a par value of Baht 2.50 each and fully paid up.

75.26

BeboydCg Company Limited

1000/6 Liberty plaza building, 20th Floor, Sukhumvit 55, Sukhumvit Road, Klongtan-nua, Wattana, Bangkok 10110

Production of music

THB 16.52 million divided into 1.65 million ordinary shares with a par value of Baht 10 each and fully paid up.

70.00

Cineplex Company Limited

118/1 Tipco Tower, Rama VI Road, Samsen Nai, Phayathai, Bangkok 10400 Tel. (662) 615-9000 Fax. (662) 615-9900

Program production

THB 1,283.43 million divided into 128.34 million ordinary shares with a par value of Baht 10 each and fully paid up.

91.79

Click TV Company Limited

118/1 Tipco Tower, Rama VI Road, Samsen Nai, Phayathai, Bangkok 10400 Tel. (662) 615-9000 Fax. (662) 615-9900

Interactive television business

THB 46 million divided into 4.6 million ordinary shares with a par value of Baht 10 each and fully paid up.

91.79

Channel [V] Music (Thailand) Company Limited (formerly “Music Bus Company Limited”)

118/1 Tipco Tower, Rama VI Road, Samsen Nai, Phayathai, Bangkok 10400 Tel. (662) 615-9000 Fax. (662) 615-9900

Audio visual and related services

THB 65 million divided into 650,000 ordinary shares with a par value of Baht 100 each and fully paid up.

23.87

Future Gamer Company Limited

1035/22 Soi Khunvijit Sukhumvit 71 Road, Klongtan-nua, Wattana, Bangkok 10110 Tel. (662) 382-1543 Fax. (662) 382-1545

Publication and advertising

THB 16 million divided into 1.6 million ordinary shares with a par value of Baht 10 each and fully paid up.

90.00

IBC Symphony Company Limited

118/1 Tipco Tower, Rama VI Road, Samsen Nai, Phayathai, Bangkok 10400 Tel. (662) 615-9000 Fax. (662) 615-9900

Dormant

THB 30 million divided into 3 million ordinary shares with a par value of Baht 10 each and fully paid up.

91.79

BETTER TOGETHER

Company Name

Address

Type of Business

Paid-up Capital

% of investment

Internet Knowledge Service Center Company Limited

2/4 Siam Commercial, Samaggi Insurance tower, 10th Floor, Vibhavadee-Rangsit Road, Thungsonghong, Laksi, Bangkok 10210 Tel. (662) 979-7000

Nongovernment telecommunication

THB 50 million divided into 12 million ordinary shares with a par value of Baht 10 each, 2.67 ordinary shares fully paid up and 9.33 ordinary shares call-up Baht 2.50 each.

56.93

Internet Shopping Mall Company Limited

2/4 Siam Commercial Samaggi Insurance tower, 10th Floor, Vibhavadee-Rangsit Road, Thungsonghong, Laksi, Bangkok 10210 Tel. (662) 979-7000

Training services and distributor

THB 50,000 divided into 20,000 ordinary shares with a par value of Baht 10 each and call-up Baht 2.50 each.

58.10

K.I.N. (Thailand) Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Holding Company

THB 352.50 million divided into 11.75 million ordinary shares with a par value of Baht 30 each and fully paid up.

99.99

KSC Commercial Internet Company Limited

2/4 Siam Commercial, Samaggi Insurance tower, 10th Floor, Vibhavadee-Rangsit Road, Thungsonghong, Laksi, Bangkok 10210 Tel. (662) 979-7000

Internet provider

THB 15 million divided into 1.5 million ordinary shares with a par value of Baht 10 each and fully paid up.

37.80

MKSC World Dot Com Company Limited

2/4 Siam Commercial, Samaggi Insurance tower, 10th Floor, Vibhavadee-Rangsit Road, Thungsonghong, Laksi, Bangkok 10210 Tel. (662) 979-7000

Internet services and distributor

THB 200,000 divided into 9,800 ordinary shares with a par value of Baht 10 each and 10,200 preference shares with a par value of Baht 10 each and fully paid up.

91.05

Online Advertising Goldsite Company Limited

2/4 Siam Commercial, Samaggi Insurance tower, 10th Floor, Vibhavadee-Rangsit Road, Thungsonghong, Laksi, Bangkok 10210 Tel. (662) 979-7000

Publication

THB 50,000 divided into 20,000 ordinary shares with a par value of Baht 10 each and call-up Baht 2.50 each.

58.10

ANNUAL REPORT 2007

Company Name

Address

Type of Business

Paid-up Capital

% of investment

Online Station Company Limited

1035/22 Soi Khunvijit Sukhumvit 71 Road, Klongtan-nua, Wattana, Bangkok 10110 Tel. (662) 382-1543 Fax. (662) 382-1545

Internet service and e-commerce

THB 1 million divided into 100,000 ordinary shares with a par value of Baht 10 each and fully paid up.

90.00

Red Media Company Limited

118/1 Tipco Tower, Rama VI Road, Samsen Nai, Phayathai, Bangkok 10400 Tel. (662) 615-9000 Fax. (662) 615-9900

Dormant

THB 25 million divided into 2.5 million ordinary shares with a par value of Baht 10 each and fully paid up.

91.79

Samut Pakan Media Corporation Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Telecommunication services

THB 1 million divided into 10,000 ordinary shares with a par value of Baht 100 each and fully paid up.

75.21

Satellite Service Company Limited

118/1 Tipco Tower, Rama VI Road, Samsen Nai, Phayathai, Bangkok 10400 Tel. (662) 615-9000 Fax. (662) 615-9900

Sales and rental of equipment related to Pay Television

THB 2,880 million divided into 480 million ordinary shares with a par value of Baht 6 each and fully paid up.

91.79

Song Dao Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Collection agent

THB 1 million divided into 10,000 ordinary shares with a par value of Baht 100 each and fully paid up.

75.21

Tele Engineering and Services Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Content provider

THB 25 million divided into 2.5 million ordinary shares with a par value of Baht 10 each and fully paid up.

99.99

Telecom Equipment Manufacturing Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Dormant

THB 24 million divided into 2.4 million ordinary shares with a par value of Baht 10 each and fully paid up.

59.99

BETTER TOGETHER

Company Name

Address

Type of Business

Paid-up Capital

% of investment

Telecom Holding Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Holding Company

THB 17,300.25 million divided into 1,743.53 million ordinary shares with a par value of Baht 10 each, 1,722.53 million ordinary shares fully paid up and 21 million ordinary shares call-up Baht 3.57 each.

99.99

Telecom International Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Holding Company

THB 300 million divided into 30 million ordinary shares with a par value of Baht 10 each and fully paid up.

99.99

Telecom KSC Company Limited

2/4 Siam Commercial, Samaggi Insurance tower, 10th Floor, Vibhavadee-Rangsit Road, Thungsonghong, Laksi, Bangkok 10210 Tel. (662) 979-7000

Nongovernment telecommunication

THB 250,000 divided into 100,000 ordinary shares with a par value of Baht 10 each and call-up Baht 2.50 each.

34.39

Telecom Training and Development Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Training service

THB 120 million divided into 13 million ordinary shares with a par value of Baht 10 each, 5 million ordinary shares fully paid up and 8 million ordinary shares call-up Baht 8.75 each.

99.99

True Digital Entertainment Company Limited 1 Fortune Tower, 25th Floor, Ratchadaphisek Road, Din Dang, Bangkok 10400 Tel. (662) 641-1800

Online game

THB 718.5 million divided into 97.5 million ordinary shares with a par value of Baht 10 each, 63.30 million ordinary shares fully paid up and 34.20 million ordinary shares call-up Baht 2.50 each.

99.99

True Distribution and Sales Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Retail services

THB 1 million divided into 10,000 ordinary shares with a par value of Baht 100 each and fully paid up.

75.14

True International Communication Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Telecommunication service

THB 1 million divided into 10,000 ordinary shares with a par value of Baht 100 each and fully paid up.

99.94

ANNUAL REPORT 2007

Company Name

Paid-up Capital

% of investment

Internet solution provider

THB 511.2 million divided into 60.28 million ordinary shares with a par value of Baht 10 each, 23.64 million ordinary shares fully paid up and 36.64 million ordinary shares call-up Baht 7.50 each

99.99

True Internet Data Center Company Limited 18 True Tower, 14th Floor, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Internet data center

THB 149.59 million divided into 14.96 million ordinary shares with a par value of Baht 10 each and fully paid up.

70.00

True Internet Gateway Company Limited

1 Fortune Tower, 15th Floors, Ratchadaphisek Road, Din Dang, Bangkok 10400 Tel. (662) 641-1800

Telecommunication and internet services

THB 51 million divided into 510,000 ordinary shares with a par value of Baht 100 each and fully paid up.

99.99

True Leasing Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Rental services

THB 2,462 million divided into 246.20 million ordinary shares with a par value of Baht 10 each and fully paid up.

99.99

True Lifestyle Retail Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Internet cafe and related services

THB 131 million divided into 13.1 million ordinary shares with a par value of Baht 10 each and fully paid up.

99.99

True Magic Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Production and distribution of movies film

THB 3.5 million divided into 350,000 ordinary shares with a par value of Baht 10 each and fully paid up.

99.99

True Money Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Payment service center and electronic card services

THB 200 million divided into 20 million ordinary shares with a par value of Baht 10 each and fully paid up.

99.99

True Internet Company Limited

Address 1 Fortune Tower, 14th, 27th Floors, Ratchadaphisek Road, Din Dang, Bangkok 10400 Tel. (662) 641-1800

Type of Business

BETTER TOGETHER

Company Name

Address

Type of Business

Paid-up Capital

% of investment

True Move Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Cellular operator

THB 33,600.17 million divided into 3,360.02 million ordinary shares with a par value of Baht 10 each and fully paid up.

75.19

True Multimedia Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

NON-POTS and multimedia services

THB 6,562 million divided into 656.2 million ordinary shares with a par value of Baht 10 each and fully paid up.

91.08

True Music Company Limited (formerly “Internet KSC Company Limited”)

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Content provider

THB 50,000 divided into 20,000 ordinary shares with a par value of Baht 10 each and call-up Baht 2.50 each.

75.16

True Music Radio Company Limited

23/6-7, 2nd – 4th Floor , Trading and Soi Soonwijai, Rama 9 Road, production of Bangkapi, Bangkok advertising media Tel. (662) 641-4838-9 Fax. (662) 641-4840

THB 1 million divided into 10,000 ordinary shares with a par value of Baht 100 each and fully paid up.

69.94

True Properties Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Rental services

THB 3,488 million divided into 34.88 million ordinary shares with a par value of Baht 100 each and fully paid up.

99.99

True Public Communication Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Telecommunication services

THB 1 million divided into 10,000 ordinary shares with a par value of Baht 100 each and fully paid up.

99.94

True Touch Company Limited

18 True Tower, Ratchadaphisek Road Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Call center services

THB 193 million divided into 1.93 million ordinary shares with a par value of Baht 100 each and fully paid up.

99.99

ANNUAL REPORT 2007

Company Name

Address

Type of Business

Paid-up Capital

% of investment

True Universal Convergence Company Limited

18 True Tower, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Telecommunication services

THB 1 million divided into 10,000 ordinary shares with a par value of Baht 100 each and fully paid up.

99.94

True Visions Public Company Limited

118/1 Tipco Building, Rama VI Road, Phayathai,Bangkok 10400 Tel. (662) 615-9000 Fax. (662) 615-9900

Pay Television

THB 2,266.72 million divided into 755.57 million ordinary shares with a par value of Baht 3 each and fully paid up.

91.79

True Visions Cable Public Company Limited

118/1 Tipco Tower, Rama VI Road, Samsen Nai, Phayathai, Bangkok 10400 Tel. (662) 615-9000 Fax. (662) 615-9900

Pay television via cable system

THB 7,608.65 million divided into 760.86 million ordinary shares with a par value of Baht 10 each and fully paid up.

91.19

UBC Fantasia Company Limited

118/1 Tipco Tower, Rama VI Road, Samsen Nai, Phayathai, Bangkok 10400 Tel. (662) 725-7400 Fax. (662) 725-7401

Artist management and related business

THB 25 million divided into 2.5 million ordinary shares with a par value of Baht 10 each and fully paid up.

91.79

Wire & Wireless Company Limited

54 W&W Building, Pattanakarn 20, Suanluang, Bangkok 10250 Tel. (662) 717-9000 Fax. (662) 717-9900

Construction

THB 100 million divided into 10 million ordinary shares with a par value of Baht 10 each and fully paid up.

87.50

NC True Company Limited

18 True Tower, 18th Floor, Ratchadaphisek Road, Huai Khwang, Bangkok 10310 Tel. (662) 643-1111 Fax. (662) 643-1651

Developer and service provider of games online

THB 174.91 million divided 50.00 into 8.57 million ordinary Shareholding shares and 8.92 million but preference shares with a par 40.00 value of Baht 10 each and Voting fully paid up. Rights

Asia Remanufacturing Industries Company Limited

102, 15th Floor, Modification, Na Ranong Road, repair and Klongtoey, Bangkok 10110 maintenance Services

THB 5.6 million divided into 56,000 ordinary shares with a par value of Baht 100 each and fully paid up.

20.00

Thai Smart Card Company Limited

191 Silom Complex Building, 27th Floor, Room No. 2, Silom Road, Bangrak, Bangkok

THB 1,200 million divided into 160 million ordinary shares with a par value of Baht 10 each, 80 million ordinary shares fully paid up and 80 million shares call-up Baht 5 each.

15.76

Central Service Bureau for clearing electronic Payment Transactions

BETTER TOGETHER

Company Name

Address

Type of Business

Paid-up Capital

% of investment

NEC Corporation (Thailand) Company Limited

159 Sermmit Tower 2nd, 24th Floor, Sukumvit 21, Klongtoey Nua, Wattana, Bangkok

TelecommuniTHB 343 million divided into cation equipment 343,000 ordinary shares manufacturer with a par value of Baht 1,000 each and fully paid up.

9.62

AnyMobile Inc.

1-4-30 Roppongi, Minato-ku, Tokyo, Japan

International Direct Dialing (IDD) telecommunication service

Yen 18 million divided in to 1,800 ordinary shares with a par value of Yen 10,000 each and fully paid up.

41.35

International Broadcasting Corporation (Cambodia) Company Limited

8 Levine Blvd. Phnom Penh City, Cambodia

Dormant

USD 1 million divided into 1 million ordinary shares with a par value of USD 1 each and fully paid up.

64.25

K.I.N. (Thailand) Company Limited

P.O. Box 957, Offshore Incorporation, Road Town, Tortola, British Virgin Island

Holding Company

USD 1 divided into 1 ordinary share with a par value of USD 1 each and fully paid up.

99.99

Nilubon Company Limited

P.O. Box 71, Craigmuir Chambers, Road Town, Tortola, British Virgin Island

Holding Company

USD 8,000 divided into 8,000 ordinary shares with a par value of USD 1 each and fully paid up.

99.99

TA Orient Telecom Investment Company Limited

3/F, Hing Yip Commercial Centre, 272 Des Voeus Road C., Hong Kong

Holding Company

USD 15 million divided into 15 million ordinary shares with a par value of USD 1 each and fully paid up.

99.99

Telecom Asia (China) Company Limited

P.O. Box 957, Offshore Incorporation Road Town, Tortola, British Virgin Island

Communication

USD 10 divided into 10 ordinary shares with a par value of USD 1 each and fully paid up.

99.99

Telecom International China Company Limited

P.O. Box 71, Craigmuir Chambers, Road Town, Tortola, British Virgin Island

Communication

USD 10 divided into 10 ordinary shares with a par value of USD 1 each and fully paid up.

99.99

Chongqing Communication Equipment Company Limited

140 Daping Zhengjie Chongqing, Peopleâ&#x20AC;&#x2122;s Republic of China

TelecommuniRMB 292 million. cation equipment manufacturer

ANNUAL REPORT 2007

38.21

BETTER TOGETHER

of True Group

Investment Structure

References Registrar

: Thailand Securities Depository Company Limited 62 The Stock Exchange of Thailand Building, Rachadapisek Road, Klongtoey, Bangkok 10110 Telephone: (662) 229-2888 Fax: (662) 359-1259 Website: http://www.tsd.co.th

Auditor

: Mrs. Nattaporn Phan-Udom (Certified Public Accountant (Thailand) No. 3430) and/or Mr. Boonmee Ngotngamwong (Certified Public Accountant (Thailand) No. 3673) and/or Mrs. Anothai Leekitwattana (Certified Public Accountant (Thailand) No. 3442) PricewaterhouseCoopers ABAS Limited 179/74-80 Bangkok City Tower, 15th Floor, South Sathorn Road, Sathorn, Bangkok 10120 Telephone: (662) 286-9999, (662) 344-1000 Fax: (662) 286-5050

Debenture Registrar/ : TMB Bank Public Company Limited Debentureholdersâ&#x20AC;&#x2122; 393 Silom Road, Bangrak, Bangkok 10500 Representative Telephone: (662) 230-5575, (662) 230-5487, (662) 230-5731 Fax: (662) 266-8150

ANNUAL REPORT 2007

Risk Factors While True sees many opportunities for growth in 2008, there are a number of general and specific factors that could impact the company’s performance and that of its subsidiaries. Risks relating to our operations We, as a group, have experienced, and expect to continue to experience, increasing competition in the businesses in which we operate. True and its subsidiaries, particularly TrueMove and the Internet and Broadband businesses, face increasing competition. The Thai mobile communications sector experienced intense price competition in 2005 and 2006, resulting in tariff reductions and declines in ARPU and margin. Our blended ARPU for TrueMove declined by 10 percent in 2005 (from Baht 437 in 2004 to Baht 393) and by 26 percent in 2006 (to Baht 292). The increase in subscriber additions and increase in usage we experienced following this period of intense price competition required us to make additional capital expenditures to alleviate congestion and expand our network capacity. Our EBITDA margin in 2006 declined to 21.4 percent (from 23.4 percent in 2005). However, 2007 saw the industry moving to more rational competition as operators entered into the interconnection regime which requires them to pay for access to other networks (Bt 1 per minute on average), putting a floor on prices. Operators have increased tariffs gradually resulting in lower usage, due to consumers’ price sensitivity. TrueMove ARPU declined further by 35 percent in 2007 (to Baht 191) from lower usage; however, its EBITDA margin improved to 29.1 percent, mainly attributable to the removal of access charges. More market competition may result in 2008 if the National Telecommunication Commission (NTC) allows telecom operators to launch additional services, introduces number portability or grants telecom licenses to new operators. Recent changes of ownership in our key competitors may also expose us to competition from foreign-owned operators with more experience in other competitive markets and greater financial resources. In the broadband Internet market, we will face competitors ranging from start-up Internet companies to multinational companies, whose applications for ISP licenses were approved by the NTC in 2005. At the beginning of 2006 the NTC granted a fixed-line license to TT&T Broadband Company Limited. TT&T could provide fixed line and broadband Internet services nationwide. The NTC also granted fixed-line (including broadband) licenses to AIS’s subsidiary, namely Super Broadband Network Company Limited. Competition will intensify after these newly licensed operators launch their services. In addition, True’s wireline business will face indirect and growing competition from mobile phone businesses and Voice over Internet Protocol (VoIP) services, whose tariffs are lower than those for traditional wireline services. We expect competition to remain intense, but we believe True is well positioned to meet this competition given our leadership position through our ability to provide fully integrated services together with the strength of our brand. TrueMove has captured one third of subscriber additions in the Thai mobile market every year since 2004 and True Group still maintains its market leadership in Internet and Broadband due to the advantages of its modern fixed-line network. True’s subsidiaries have applied for new licenses to take advantage of new opportunities offered by regulatory reform and to compete fairly with other operators. At the time of writing, we have been granted an ISP license, an international Internet gateway license, a public phone license, a fixed-line license, an International BETTER TOGETHER

Direct Dialing (IDD) license, one-year trial licenses for International Private Leased Circuit (IPLC) and International Internet Protocol Virtual Private Network (IP VPN), and a six-month trial license for WiMax. Rapid technological change could also adversely affect the viability of True’s business and make its current technology less competitive. The communications industry is characterized by rapid changes in technology, evolving customer needs and new products and services. These changes are, in some cases, brought about by regulators opening up the market. Key emerging technologies for the Thai communications industry in the near future are expected to include third generation (3G) mobile phones, wireless broadband (WiMax), and number portability services. In order to respond successfully to emerging industry trends, we may be required to make substantial capital expenditure given the industry’s capital intensive nature. But if we do not invest in the new technology it will lower our competitiveness. However, we believe that integrated operators, such as ourselves, with diversified services, products, revenues and customer bases, are in a better position to cope with these rapid changes than are ‘pure play’ operators. We believe that we have a stronger ability to manage potential revenue cannibalization from new technologies by being able to keep allied services and revenues ‘in-house’ and by being able to balance customers relationships across our brand, whether mobile, broadband or fixed line .

Risks relating to regulatory environment Thailand’s communications industry is in a state of transition and a significant degree of uncertainty exists regarding the regulatory environment. In accordance with Thailand’s commitment to the World Trade Organization (WTO) to liberalize its telecommunications sector by 2006, the Thai government embarked on a reform of the country’s telecommunications regulatory regime with the passage of two major legislative acts: the Organizations Allocating Frequency Waves and Supervising Radio and Television Broadcasting and Telecommunications Business Act, or the NTC Act, in March 2000; and the Telecommunications Business Operation Act, or the TBO Act, in November 2001. In October 2004, the NTC was established as the independent regulator of the telecommunications industry, assuming the regulatory functions previously exercised by the Telephone Organization of Thailand (now known as TOT Public Company Limited), or the TOT, the Communications Authority of Thailand (now known as CAT Telecom Public Company Limited), or CAT, and the Post and Telegraph Department. From its establishment to the end of 2007, the NTC has issued regulations prescribing, among other things: (1) licensing requirements for the various defined categories of telecommunications services; (2) eligibility requirements and application procedures for the three categories of telecommunications licenses available in Thailand; (3) interim regulations for allocating telephone numbers; (4) the change of mobile phone numbers from 9-digits to 10-digits; (5) anti-monopoly and unfair competition rules; (6) the interconnection regulation; (7) procedures for receiving and considering subscribers’ complaints; (8) standards of telecommunications service contracts; (9) price caps and prepaid collection; (10) resale of services; (11) frequency use license transfer and measures for frequency sharing for telecom services; and (12) broadband wireless access for trial The NTC is expected to issue a number of additional policies and regulations in 2008 that may have a significant impact on our business. The section 47 of new constitution enacted in August 2007 indicates that a new regulatory body, the National Broadcasting and Telecommunication Commission (NBTC) will be set up to regulate the telecom and broadcasting industry, and be the only regulatory body.

ANNUAL REPORT 2007

Since the NBTC is not yet established, the Company is unable to predict how the NBTC will exercise its regulatory authority. However, the new constitution states that the Act for the setting up of the NBTC must be enacted within 180 days of the new government announcing its policy. Delays in the establishment of the NBTC may delay the issuing of licenses for new telecom services that require the allocation and management of radio frequency including mobile phone business. This is despite the fact that the NTC maintains its regulatory power until the NBTC will be established. The Radio and Television Broadcasting Act B.E. 2551 has given authority and power for the existing NTC to temporarily regulate and grant (one-year) licenses for community radio and other services that do not require radio frequencies before the NBTC can be set up. If the regulator does not issue a license to TrueMove before the concession contract expires in September 2013, the company will not be able to continuously pursue its business and this will strongly impact True Group’s financial status and performance, given TrueMove is our core business (TrueMove’s revenue accounted for 44 percent of True Group total revenue in 2007). The NTC’s interim telecommunications license fee regulation sets out a lower tariff structure for new entrants that operate under the licensing regime than the tariffs that are applicable to existing concessionaires, such as True, that are operating their businesses under the concession agreements granted by TOT and CAT. This could disadvantage existing concessionaires against new entrants. In addition, the operators under concession agreements have been in dispute with its concession grantors on the new regulations, which contradict to the conditions indicated in their concession agreements. As a result, related parties have to adjust or amend the concession contract, laws and regulations to be in line with international practice on free competition. However, we cannot foresee the outcome. Apart from the above risks the Company may be impacted because the concession contract may be amended or cancelled. In January 2007 the Cabinet approved a proposal made to the Council of State to consider legal issues regarding Private-Public Joint Venture Law B.E. 2535: whether the concession contracts between stateowned enterprises and private telecom operators are in compliance with the Law or not. On May 18, 2007, the Council of State decided that CAT’s actions were not in line with Private-Public Joint Venture Law B.E. 2535 and that the contract between CAT and TrueMove remains in effect as long as there is no cancellation or other conditions that would cause the contract to be terminated. So CAT and TrueMove will have to comply with the contract. However, the Council of State also considers that the contract’s co-owners, as well as the co-ordination committee, according to Section 22 of Private-Public Joint Venture Law B.E. 2535, should negotiate with all parties to the joint venture and propose the result of the negotiations to the Cabinet. The Cabinet will have authority to give final decisions (according to Private-Public Joint Venture Law B.E. 2535) to cancel or approve the amendment of the concession contract. The Cabinet may consider allowing the Company to operate the business considering the benefits to the government and public, as well as continuity of public service. However, the situation remains uncertain because the Cabinet has not yet agreed on the final decision. The Council of State’s ruling and the Cabinet’s decision can only be binding the state enterprises. However, TrueMove can bind itself by accepting the Cabinet’s resolution. In addition, TrueMove and the State enterprise will only conclude negotiations when both parties have a mutual agreement, otherwise the Court ruling will be final. As a result, if TrueMove loses the court case, it will not be able to operate its telecommunications business and may have an additional burden to pay to the State enterprise. In January 2007, the Cabinet endorsed the zero-rate excise tax and ended the 2003 resolution that imposed an excise tax of 2 percent and 11 percent for fixed-line phone and mobile phone operators, respectively. The 2003 resolution allowed private telecom operators to deduct part of their concession fees to be paid as excise tax directly to the government, before sharing the remaining fee with their concession owners. Even though there remains a dispute on this issue, the zero-rate excise tax will allow TOT and CAT to receive full concession fees, while the total regulatory fees of the private telecom firms have remained unchanged. True Group will continue to play an active role in discussions with the NTC and the ICT Ministry regarding the telecommunication industry’s regulatory environment and to advocate free-and-fair competition on a level playing field. TOT initiated legal proceedings against TrueMove to pay access charges. This may result in an increase in our expenses TrueMove operates its mobile phone business under a CAT concession and was signatory to an access charge agreement among TOT, CAT and TrueMove under which it pays Baht 200 per subscriber per month BETTER TOGETHER

directly to TOT for postpaid subscribers and 18 percent of its revenue to TOT for prepaid subscribers. In addition, we have to make a revenue-sharing payment of 25 percent of net revenue after the access charge payment to CAT. In May 2006, the NTC announced its Interconnection Regulation which stipulated that telecommunications operators who have telecommunication networks allow other operators to access their networks in compliance with the procedure specified in the regulation. The regulation sets a new interconnection system whereby interconnect charges will reflect actual network usage by each operator. Under the regulation, operators are also required to enter into agreements with one another to establish interconnection charge rates, based on cost. On November 17, 2006 TrueMove signed an interconnection contract with DTAC (Total Access Communications) with the contract taking immediate effect. On January 16, 2007 TrueMove signed an interconnection contract with AIS (Advanced Info Service). Following the entry into the interconnection charge agreement with DTAC, in compliance with the said regulations, TrueMove ceased paying access charges under the access charge agreement with CAT and TOT as it believes that, following the introduction of the interconnection regime, it is no longer bound by, or legally able to make payments under, the access charge agreements. On November 17, 2006 TrueMove wrote to CAT and TOT informing them that it would cease paying access charges and cancel the agreement on the basis that the rate and collection of access charges under the agreement were contrary to the law. TrueMove also asked TOT to enter an interconnection charge agreement in compliance with the law, or to temporarily apply the provisional rate announced by the NTC, while negotiations on an agreement with TOT proceeded. As a result of the cessation of access charge payments by TrueMove, on November 23, 2006, TOT issued a letter stating that TrueMove was not entitled to connect its network with TOT’s because it was not a telecommunications licensee, as granted by the NTC, and did not have its own telecommunications network. TOT also disputed that the Access Charge Agreement did not violate any law and that the rate and collection of access charge under the Access Charge Agreement continued to apply. In addition, TOT has threatened not to integrate TrueMove’s 1.5 million new phone numbers, allocated by the NTC to its system, meaning that TOT subscribers would not be able to call TrueMove subscribers with those 1.5 million phone numbers. TrueMove filed a lawsuit with the Central Administrative Court requesting an injunction and on January 26, 2007 the Court ordered TOT to connect its network with TrueMove’s new numbers so that subscribers of TOT and TrueMove could communicate with each other. On January 30, 2007, TOT appealed the Court order to the upper court whose decision was still pending at the time of writing. However, TOT connected its network with TrueMove’s new numbers issued by NTC from March 2, 2007 onwards. In June 2007, TrueMove brought this issue to the NTC’s Dispute Resolution Committee. On November 28, 2007 the NTC issued its final decision, confirming that TrueMove has the same rights, duties and responsibilities in relation to the interconnection regime as the licensee (who has been granted the NTC’s license). The NTC unanimously ordered TOT to negotiate with TrueMove on the IC issue within seven days of receiving the order and to complete the signing of the IC contract within 30 days of starting negotiations. The NTC’s final decision was in accordance with its decision on the interconnection charge issue between DTAC and TOT. On November 16, 2007 TOT filed a lawsuit against TrueMove with the Civil Court, claiming violation of the access charge contract and requesting access charge payments of Baht 4,508 million with related interest and value-added tax. The lawsuit is currently in the judicial process of the Civil Court. If we are not successful in resolving this issue in our favor, in addition to a penalty equal to 100 percent of any access charges CAT may have paid to TOT on our account and interest thereon, we may be required to pay both new interconnection charges as well as existing access charges, which will result in a material increase in our costs. If TrueMove is required to pay access charges by court order for the period from November 18, 2006 to December 31, 2006, TrueMove would be liable to accrue additional access charges of Baht 455.6 million, or Baht 204.3 million, net of revenue-sharing paid to CAT, and an additional Baht 4,271.7 million, or Baht 3,283.9 million, net of revenue sharing to CAT, excluding the penalty charge. (See note 38 to the Consolidated and Company Financial Statements for the year ended December 31, 2007.) We compete with our concession grantors and this has led to and could continue to lead to disputes with them, which could affect our operations. True and its subsidiaries operate under the “Agreement for Joint Operation and Joint Investment for Expansion of Telephone Services” and/or the Agreement of Mobile Services granted by TOT or CAT.

ANNUAL REPORT 2007

A dispute with either TOT or CAT over compliance with either the concession agreement itself or NTC’s regulations could affect the ability of True and its subsidiaries to conduct the business. If the final outcome is not in favor of the Company, it could affect the ability of True and its subsidiaries to conduct business. Our fixed-line concession could be cancelled by TOT if True violates laws relating to public or national security, is placed under receivership by a court in a bankruptcy case, or willfully and continually breaches a concession agreement in any material respect. Under the revenue-sharing provisions of True’s fixed-line concession, TOT collects all of True’s fixed-line revenues from subscribers within True’s network and retains a portion for revenue sharing. TOT may withhold or delay payments from revenues collected for True to offset any obligations it believes it is owed (although this has not occurred to date). As well as being True’s concession grantors, TOT and CAT are also our competitors. This has led, and could continue to lead, to disputes between True and TOT and between True and CAT. Previously TOT and True brought some disputes to the Courts and the Arbitration Tribunal for adjudication. We may not be able to successfully resolve any of these disputes in our favor, and if we were unsuccessful, our business and financial situation could be affected. At the time of writing, the judgments have been issued both in favor and against cases brought by True. (See notes 37 to the Consolidated and Company Financial Statements for the year ended December 31, 2007 related to “Litigation and Arbitration Disputes and Contingent Liabilities”.)

Risks relating to financial situation Our operations are at risk due to our high debt levels and are restricted by debt and other financial agreements. Exchange rate and interest rate movements may increase our interest payments and other financial obligations. True Group and its subsidiaries have high debt levels and may be at risk of failing to find funding each year to repay principal and interest. However, we would be able to negotiate with our creditors or raise new loans to repay existing loans and adjust our principal repayments to suit our cash flow. True’s operation is limited by a number of debt and other financial agreements. These agreements could prohibit True from exploiting good business opportunities or lead to accelerated debt repayment if some of the debt covenants are not in line with those indicated by the financial agreements, or if TOT cancels the concession agreement with True. However, TOT must seek an arbitration decision in order to cancel the concession agreement. True’s financial ratios as of December 31, 2007 are in compliance with the loan agreements. True is subject to exchange rate fluctuations, which could increase principal, interest payments and capital expenditure. As of December 31, 2007 approximately 40 percent of True Group’s consolidated liabilities were denominated in foreign currencies, most of which was denominated in US Dollars. In the year 2007, True had consolidated capital expenditure of approximately Bt 8.3 billion, 49 percent of which was in foreign currencies. True has put in place hedging tools to reduce its exposure to exchange rate fluctuations, for 93 percent of a USD 140 million loan belonging to TrueMove and of a USD 200 million long-term loan for the TrueVisions acquisition as well as a TrueMove bond of USD 690 million. In addition, True had also entered into an interest rate swap that hedged foreign exchange exposure on interest payments for the maturity of all US Dollar loans and reduced interest rate exposure. As a result, the US Dollar interest rates for these US Dollar loans were converted into Thai Baht fixed rates. However, there is no hedging in place for the Japanese Yen-denominated deferred payment note of Bt 3.4 billion, which matures from 2014 to 2017. As at the end of December 2007, of True’s total consolidated debt (excluding finance leases), approximately 36 percent is subject to floating interest rates, excluding a portion that has been hedged to fix interest rates. However, interest rates on part of TrueMove’s debt will reduce over time if it is able to achieve the conditions set out in its loan agreement. We may not be able to pay a dividend to shareholders in the near future. As at the end of 2007, True reported a net profit of Baht 1.7 billion with a retained loss of Baht 42.6 billion due largely to the Thai Baht currency devaluation in 1997. In accordance with Thailand’s Public Company Limited Act, True is able to pay dividends to its shareholders only from profits earned, after provision has been made for a legal reserve, and after cumulative losses have been depleted. BETTER TOGETHER

policy.

Therefore, shareholders may not receive a dividend in the near future, as is stated in True’s dividend

The risk to minor shareholders according to the conditions stated in the shareholders’ agreement. The shareholders agreement dated December 22, 1999 by Kreditanstalt für Wiederaufbau (“KfW”), Nynex Network Systems (Thailand) Company (“Verizon”) and Charoen Pokphand Group (see summary at the Capital Structure - Shareholders’ Agreement) does not allow the Company the freedom to take certain actions that may affect the Company’s operations as follow. During the first three years from the date of KfW’s subscription to shares in the Company and so long as KfW holds at least 5 percent of the paid-up shares in the Company, directly or indirectly, the parties to the shareholders’ agreement are required to vote against any amendment to the memorandum and articles of association, any increase or reduction in the authorized share capital of the Company, any change in the number of directors or the quorum for meetings of the Board of Directors, unless KfW agrees. The minor shareholders may not get the full opportunity to consider the above issues unless KfW has given prior agreement. However, in practice KfW will act in the best interests of, and to the benefit of, the Company as well as taking good corporate governance into consideration. As of February 26, 2008, the latest closing date of the share register, KfW is the second - largest shareholder holding 15.53 percent of total paid-up shares, including shares registered under Thai Trust Fund (see list of major shareholders at “Capital Structure – Shareholders”).

Risks relating to the TrueVisions (formerly UBC) acquisition. We may share a number of risks associated with the TrueVisions business. After the Company acquired TrueVisions, we became its major shareholder with 91.8 percent of TrueVisons’ shares. The Company has helped increase the growth of TrueVisions in both revenue and subscribers through diversified branding and services; improvement in our ability to manage churn rates; and improved access to assets rich in content. However, we may have to share a number of risks associated with the TrueVisions business, including, among others, the following: • TrueVisions relies on third-party suppliers for most of its programming. If TrueVisions is unable to obtain attractive programming or if the cost of this programming substantially increases in the future, its performance would be adversely affected. Subscribers who are interested in overseas programs are mostly subscribers to its premium packages (Platinum, Gold and Silver). Subscribers for these packages were approximately 481,000, representing 76 percent of TrueVisions’ subscriber base, excluding free view package. In addition, the cost of overseas programs in 2007 was around 23 percent of TrueVisions’ service revenue. • Unauthorized access to TrueVisions’ programming signals is difficult to prevent and will adversely affect its operational results, cash flow and programming arrangements. Currently, the number of unauthorized users is estimated to be around one third of over two million households nationwide watching cable TV. However, the Company expects that the new Radio and Television Broadcasting Act will reduce the number of unauthorized users because there is a clear provision covering unauthorized access including punishments. • Competition may increase after the Radio and Television Broadcasting Act B.E. 2551 was enacted on March 5, 2008. In 2008, we expect new licenses to be issued to new operators to operate community radio and other services that do not require radio frequencies and the licenses for operating community radio will be temporary licenses (not exceeding one year). Comprehensive and nationwide licenses cannot be issued while the regulator is not yet established. The establishment of NBTC, the new regulator, is expected to be completed by late 2008. • TrueVisions is subject to significant foreign exchange risk because a substantial portion of its revenues is denominated in Baht while a significant portion of its obligations is denominated in US dollars.

ANNUAL REPORT 2007

Shareholders True Corporation Public Company Limited Major Shareholders (as of 26th February 2008) Name CP Group2 THAI TRUST FUND3 KREDITANSTALT FUR WIEDERAUFBAU (“KfW”) THAI NVDR COMPANY LIMITED STATE STREET BANK AND TRUST COMPANY FOR LONDON 6. STATE STREET BANK AND TRUST COMPANY 7. GOLDMAN SACHS INTERNATIONAL 8. HSBC BANK PLC-CLIENTS GENERAL A/C 9. CHASE C.S. CENTRAL NOMINEES LIMITED 10. THE BANK OF NEW YORK (NOMINEES) LIMITED 1. 2. 3. 4. 5.

No. of Shares (Million Shares)

% of Total Issued Shares 1

1,351.64 357.99 341.34 332.28 299.26

30.02 7.95 7.58 7.38 6.65

121.00 111.59 102.48 86.40 80.82

2.69 2.48 2.28 1.92 1.79

1 Including common shares and preferred shares. 2 Consisting of 1) Charoen Pokphand Group Co., Ltd. and its related persons, namely 2) Bangkok Telecom Holding Company Limited 3) Charoen Pokphand Foods Public Company Limited 4) Bangkok Produce Merchandising Public Company Limited 5) Bangkok Agro-Industrial Products Public Company Limited 6) Charoen Pokphand Northeastern Public Company Limited 7) Kasetphand Industry Company Limited 8) Charoen Pokphand IN-EX Company Limited 9) Unique Network Company Limited 10) Wide Broad Cast Company Limited 11) C.P. Interfood (Thailand) Company Limited 12) Star Marketing Company Limited 13) Advance Pharma Company Limited and 14) Golden Tower Trading Limited. 3 Held shares for KfW

BETTER TOGETHER

Dividend Policy The Company has not paid or declared any dividends on its issued shares since operations began. The Company can pay dividends only out of its profits after deducting its cumulative losses, and only if it has set aside a legal reserve. The Company’s restructuring agreement also limits its ability to pay dividends until all of its indebtedness is repaid in full. The Company’s major shareholders have entered into a shareholders’ agreement under which they have agreed for the Company to declare an annual dividend equal to at least 50% of its net profits from the Company’s Financial Statement for that year, after statutory reserves and subject to availability of cash, according to the regulations indicated in related laws and its credit facilities. The Company can pay dividends to holders of its ordinary shares after making dividend payments to its preferred shareholders. For the dividend policy of subsidiary companies, each subsidiary company’s Board of Directors will consider the payment of dividends from the balance of cash flows taking into account the capital expenditure requirements of the subsidiary company. Subject to the availability of cash flows at the subsidiary company and only if it has set aside a legal reserve, the Board of Directors of each subsidiary company shall consider the payment of dividends on a case-by-case basis.

ANNUAL REPORT 2007

Management

BETTER TOGETHER

The Management Structure of the Company consists of: A. The Board of Directors B. The Committees of the Board of Directors: 1) Audit Committee 2) Independent Committee 3) Compensation and Nominating Committee 4) Finance Committee 5) Corporate Governance Committee C. The Executive Officers

A. The Board of Directors

Pursuant to the Company’s Articles of Association, it is stipulated that the Board of Directors shall consist of not less than 5 directors and that not less than one half of all directors shall have residence in the Kingdom. The qualifications of the Company’s directors shall be as prescribed by law. As of 31st December 2007, the Company’s Board of Directors consists of 18 members as follows: 1) 4 Executive Directors 2) 14 Non-Executive Directors consisting of: - 4 Independent Directors - 10 directors from various organizations relevant to the Company’s business management, including the lender group’s representatives and the major shareholders Definitions Executive Director means - A director who holds a management position and engages in the Company’s business management. Non-Executive Director means - A director who does not hold a management position and does not engage in the Company’s business management, whether or not he or she is an Independent Director. Independent Director means a director who holds the following qualifications: - Is not engaged in the business management of the Company, or of any affiliated, associated or related company or major shareholder of the Company, and is not an employee, staff member or consultant receiving a salary from the Company, any affiliated, associated or related company or major shareholder of the Company. An Independent Director also has no power of control over the Company, any affiliated or associated company, or any person with a conflict of interest with the Company. - Holds less than 5 percent of the Company’s total shares with voting rights, and holds less than 5 percent of the total shares of any company affiliated, associated with or related to any person who may have a conflict of interest with the Company as prescribed by Article 258 under the Securities Act B.E. 2535. - Is not connected or related to executives or major shareholders of the Company, or to any companies affiliated or associated with any person who has a conflict of interest with the Company. - Does not represent or protect the interests of the Board of Directors, major shareholders, or shareholders who are related to the major shareholders of the Company. - Is able to perform and provide comments on, or report on, the performance of the Board of Directors in an independent fashion. Is not under the control of management or major shareholders including related persons or close relatives of the said person.

ANNUAL REPORT 2007

The Board of Directors of the Company (as of 31st December 2007) is as follows: Name 1. Mr. Narong Srisa-an 2. Mr. Vitthya Vejjajiva 3. Dr. Kosol Petchsuwan 4. Mr. Joti Bhokavanij 5. Mr. Dhanin Chearavanont 6. Mr. Sumet Jiaravanon 7. Dr. Ajva Taulananda 8. Mr. Chaleo Souvannakitti 9. Mr. Athueck Asvanund 10. Mr. Suphachai Chearavanont 11. Mr. Soopakij Chearavanont 12. Mr. Chatchaval Jiaravanon 13. Mr. Vichaow Rakphongphairoj 14. Mr. Umroong Sanphasitvong 15. Mr. Norbert Vay** 16. Mr. Jens B. Bessai** 17. Mr. Harald Link 18. Dr. Lee G. Lam

Position Independent Director Independent Director and Chairman of the Audit Committee Independent Director and Member of the Audit Committee Independent Director and Member of the Audit Committee Chairman Vice Chairman Vice Chairman Vice Chairman Vice Chairman and Group General Counsel Director, President and Chief Executive Officer Director Director and Managing Director-Group Investment Director, Managing Director and Chief Operating Officer Director Director Director Director Director

Attendance of True Board of Directors in the Year 2007*

7/8 6/8 7/8 8/8 3/8 1/8 8/8 8/8 8/8 8/8 2/8 6/8 8/8 8/8 ***2/8 ***3/8 5/8 4/8

Remark: * **

In the Year 2007, the Board of Directors held 8 meetings The Board of Directors Meeting No. 5/2550 dated 17th August, 2007 approved the appointment of Mr. Norbert Vay and Mr. Jens B. Bessai as Directors to replace Mr. Heinrich Heims and Mr. Andreas Klocke who resigned from the Board on 30th June, 2007. *** Mr. Norbert Vay and Mr. Jens B. Bessai were appointed as members of the Board of Directors on 17th August, 2007. The Company held five Board of Directors meetings before Mr. Vay and Mr. Bessai joined.

All Director qualifications have been prescribed by law. None are prohibited persons under the laws and regulations of the Securities and Exchange Commission and the Stock Exchange of Thailand. All Directors take their responsibilities very seriously. They cooperate on all decisions affecting the Company, entailing major work and responsibility. They attend all meetings except in unavoidable circumstances. Directors unable to attend meetings notify the Board of their absence in advance while providing their comments on the major agenda items. In addition, the Board of Directors gives priority to attending the training courses organized by the Thai Institute of Directors Association (“IOD”). Certain Directors are also Independent Directors who are genuinely independent and are not authorized signatories binding the Company. All Directors are properly qualified and comply with the principles stipulated by the Securities and Exchange Commission, and the Stock Exchange of Thailand. Authorized Directors Mr. Supachai Chearavanont or Mr. Vichaow Rakphongphairoj jointly sign with Mr. Athueck Asvanund or Mr. Soopakij Chearavanont or Mr. Chatchaval Jiaravanon, with the Company’s seal affixed. BETTER TOGETHER

Authority and Responsibilities of the Board of Directors The Board of Directors is granted the authority and duty to manage the Company in compliance with the Company’s objectives and Articles of Association, and the resolutions of shareholder meetings. With regard to the management of the Company, the Board of Directors has the authority to make any decision related to the Company’s regular operations except for matters that require the approval of the shareholder meeting as specified by law. In addition, the Board of Directors may grant authorization to one or more directors, or any other person, to perform any acts on its behalf. However, for any decision on major operations such as a major investment or a major loan procurement, the management team shall propose the said transactions to the Board of Directors for approval. Election of Directors The Company allows minority shareholders to submit nominations for directors before the 2007 AGM by using the form provided by the Company and sending it by registered mail to the Company. The Compensation and Nominating Committee is responsible for appraising the qualifications of persons proposed as directors (including independent directors) of the Company in light of the significant prestige and experience required to fill the role. The Committee’s deliberations are presented to the Board of Directors for initial consideration. The Board of Directors then presents the relevant information, together with the Compensation and Nominating Committee’s opinion, to the Shareholders’ Meeting ahead of any election. Directors are appointed by shareholders by majority vote. All shareholders have the right to appoint directors. Each shareholder is entitled to one vote for each share held and is entitled to participate in the voting for all directors, provided that they do not split their votes among candidates.

B. The Committees of the Board of Directors 1) Audit Committee The Audit Committee of the Company consists of 3 persons as follows: Name 1. Mr. Vitthya Vejjajiva 2. Dr. Kosol Petchsuwan 3. Mr. Joti Bhokavanij Remark:

Position Chairman of the Audit Committee Member of the Audit Committee Member of the Audit Committee

Attendance of The Audit Committee in the Year 2007*

7/7 7/7 7/7

* In the Year 2007, the Audit Committee held seven meetings The scope of duty and responsibility of the Audit Committee is as follows: 1. To review the Company’s financial reports to ensure accuracy and adequate information for public disclosure; 2. To ensure the appropriateness and effectiveness of internal control systems and the internal auditing system of the Company; 3. To consider and propose the appointment and remuneration of an external auditor of the Company; 4. To regularly review the practices of the Company to ensure compliance with the regulations of the Securities and Exchange Act, Rules and Regulations of the Stock Exchange of Thailand and related law and regulations; 5. To review the disclosure of information of the Company to ensure the accuracy and adequacy of said information in case that there is a connected transaction that may lead to a conflict of interest; 6. To prepare the Audit Committee Report on Corporate Governance, with approval from the Chairman of the Committee, to be disclosed in the annual report of the Company; and 7. To perform any other act as required by law or as delegated by the Board of Directors.

ANNUAL REPORT 2007

2) Independent Committee The Independent Committee has been appointed by the Board of Directors. The Committee is responsible for reviewing the entering into highly significant connected transactions. The Committee consists of the following members: 1. Mr. Narong Srisa-an Independent Director 2. Mr. Joti Bhokavanij Independent Director 3. Mr. Jens B. Bessai KfW-nominated Director 4. Mr. Supachai Chearavanont CP-nominated Director 5. Mr. Athueck Asvanund CP-nominated Director In the case of any major shareholder having a conflict of interest, Directors nominated by the said shareholder will abstain from the Independent Committee Meeting when considering such a case. 3) Compensation and Nominating Committee The Compensation and Nominating Committee is responsible for determining compensation for, and considering the nomination of, Directors of the Company. The Committee consists of the following members: Name 1. 2. 3. 4.

Mr. Dhanin Chearavanont Mr. Heinrich Heims Mr. Soopakij Chearavanont Mr. Umroong Sanphasitvong

Remark:

Attendance of the Compensation and Nominating Committee in the Year 2007* 0/3 3/3 3/3 3/3

* In the Year 2007, the Compensation and Nominating Committee held three meetings

4) Finance Committee The Finance Committee assists the Company in reviewing the financial management of the Company. The Committee consists of the following members: Name 1. 2. 3. 4.

Dr. Ajva Mr. Chaleo Mr. Jens B. Mr. Umroong

Remark:

Taulananda Souvannakitti Bessai** Sanphasitvong

Attendance of the Finance Committee in the Year 2007* 7/7 7/7 **4/7 7/7

* In the year 2007, the Finance Committee held seven meetings ** Mr. Jens B. Bessai was appointed as member of the Finance Committee on 17th August 2007. The Company held three Finance Committee meetings before Mr. Bessai joined

5) Corporate Governance Committee The Corporate Governance Committee has been appointed by the Board of Directors. The Committee is responsible for setting policy on the Corporate Governance of the Company. The Committee consists of the following members:

BETTER TOGETHER

Name 1. 2. 3. 4. 5. 6.

Mr. Narong Mr. Vitthya Dr. Kosol Mr. Joti Mr. Jens B. Dr. Ajva

Remark:

Srisa-an Vejjajiva Petchsuwan Bhokavanij Bessai** Taulananda

Attendance of the Corporate Governance Committee in the Year 2007* 2/2 1/2 2/2 2/2 **1/2 2/2

* In the year 2007, the Corporate Governance Committee held two meetings ** Mr. Jens B. Bessai was appointed as member of the Corporate Governance Committee on 17th August 2007. The Company held one Corporate Governance Committee meeting before Mr. Bessai joined

C. The Executive Officers

As of 31st December 2007, the executive officers of the Company were as follows: Name

1. 2. 3. 4. 5. 6. 7. 8.

Mr. Supachai Chearavanont Mr. Vichaow Rakphongphairoj Mr. Chatchaval Jiaravanon Mr. Athueck Asvanund Mr. William Harris* Mr. Thiti Nantapatsiri Mr. Adhiruth Thothaveesansuk Mr. Songtham Phianpattanawit

Remark:

Position Director, President and Chief Executive Officer Director, Managing Director and Chief Operating Officer Director and Managing Director-Group Investment Vice Chairman, Group General Counsel and Acting Company Secretary Chief Financial Officer Managing Director Home / Consumer Solution & Highspeed Access Managing Director Office / SME Solution & Wireless Access Managing Director Corporate Solution, Wholesales & Data

* On 1st January 2008, Mr. Noppadol Dej-Udom was appointed to be chief financial officer to replace Mr. William Harris.

The term “Executive Officers” refers to Directors, the President and persons with managerial authority who are among the top four ranked individuals in the Company, after the President, and all other persons who occupy a position equivalent to a top four ranking. All the Executive Officers’ qualifications have been prescribed by law and the Officers themselves are not forbidden individuals under the laws and pronouncements of the Securities and Exchange Commission and the Stock Exchange of Thailand. Authority and Responsibility of the President The President has authority to supervise and carry on the Company’s day-to-day business, and if any matter/transaction is important, the President will submit said matter/transaction to the independent directors and/ or the relevant Committee (such as the Finance Committee, the Compensation and Nominating Committee or the Independent Committee) and/or the Board of Directors and/or shareholders as the case may be, to approve said matter/transaction. In addition, the President has no authority to approve any matter or transaction proposed by the Company or its subsidiaries in which he or she may have a conflict of interest or any other form of conflict. In such a case, the matter/transaction must be carried out according to the relevant laws and regulations.

ANNUAL REPORT 2007

Remuneration of the Company’s Directors and Executive Officers (1) Remuneration (1.1) Remuneration of Directors The 20 directors of the Company were remunerated Baht 33,196,774 for the year 2007. Remuneration per person (Baht) Group 1 - Chairman (Mr. Dhanin Chearavanont) - Independent Director who is also the Chairman of the Committee - Mr. Vitthya Vejjajiva - Mr. Narong Srisa-an - (Jan’07) - (Feb - Dec’07) Total Group 2 - Independent Directors who are also Committee members (Dr. Kosol Petchsuwan and Mr. Joti Bhokavanij) Total Group 3 - Vice Chairmen (Mr. Sumet Jiaravanon, Dr. Ajva Taulananda, Mr. Chaleo Souvannakitti and Mr. Athueck Asvanund) Total Group 4 - Directors (Mr. Supachai Chearavanont, Mr. Soopakij Chearavanont, Mr. Chatchaval Jiaravanon, Mr. Vichaow Rakphongphairoj, Mr. Umroong Sanphasitvong, Mr. Harald Link and Dr. Lee G. Lam) Mr. Heinrich Heims, Mr. Andreas Klocke (Jan-Jun’07) Mr. Norbert Vay, Mr. Jens B. Bessai (17th Aug – Dec ’07) Total Grand Total

Total (Baht)

3,600,000 3,600,000 200,000 3,300,000 10,700,000 2,400,000 4,800,000 1,800,000 7,200,000 1,200,000

600,000 448,387 10,496,774 33,196,774

(1.2) Remuneration of Executive Officers The top eight executives received remuneration totaling Baht 102.66 million for the year 2007 (January to December), which included Baht 85.20 million for salary, Baht 12.97 million for performance pay and Baht 4.49 million for provident fund. (2) Other Compensation Other compensation received by Directors and Executive Officers of the Company are as provided for under the Employee Stock Option Plan 6 Project, namely: (2.1) Employee Stock Option Plan 2006 (ESOP 2006) (2.2) Employee Stock Option Plan 2005 (ESOP 2005) (2.3) Employee Stock Option Plan 2004 (ESOP 2004) (2.4) Employee Stock Option Plan 2003 (ESOP 2003) BETTER TOGETHER

(2.5) Employee Stock Option Plan 2002 (ESOP 2002) (2.6) Employee Stock Option Plan 2000 (ESOP 2000) Furthermore, The Annual General Meeting of the Shareholders for the Year 2007 held on 24th April 2007 and the Extraordinary General Meeting of the Shareholders No. 1/2552 held on 16th July 2007 has resolved to approved the issuance and offering of warrants under ESOP 2007 Project in the total number of not exceeding 38,000,000 units. The exercise ratio is 1 unit of warrant per 1 ordinary share at the exercise price of Baht 7. The Securities and Exchange Commission (“SEC”) already granted approval for issuance and offering of the warrant. under this project. Currently, the Company is preparing additional information to submit the SEC for the next step. Details of Employee Stock Option Plans (2.1) Employee Stock Option Plan 2006 The Annual General Meeting of the Shareholders of the Company for the year 2006 held on 11th April 2006 approved the issuance and offering of non-transferable warrants to purchase the Company’s ordinary shares to certain Directors and employees at executive level of the Company and/or its subsidiaries (“ESOP 2006 Project”). Summary details are as follows: Number of Warrants Issued and Outstanding Date of Issuance Maturity Date of Expiry Exercise Period

36,051,007 units

: : : :

Exercise Ratio

31st January 2007 5 years from the issuance date 30th January 2012 Each Warrant Holder received 3 separate warrant certificates. Each certificate represented 1/3 of the total amount of warrants allotted and is exercisable for subscribing for ordinary shares as follow: The 1st Certificate: Warrant Holders can start exercising from the last business day of April 2007 until its expiration. nd The 2 Certificate: Warrant Holders can start exercising from the last business day of April 2008 until its expiration. The 3rd Certificate: Warrant Holders can start exercising from the last business day of April 2009 until its expiration. One unit of warrants entitles purchase of one ordinary share at Baht 10.19

(2.2) Employee Stock Option Plan 2005 The Extraordinary General Meeting of the Shareholders No. 1/2548 held on 15th July 2005 approved the issuance and offering of non-transferable warrants to purchase the Company’s ordinary shares to the directors and employees at executive level of the Company and/or its subsidiaries (“ESOP 2005 Project”). Summary details are as follows: Number of Warrants Issued and Outstanding Date of Issuance Maturity Date of Expiry Exercise Period

Exercise Ratio

ANNUAL REPORT 2007

18,774,429 units

28th April 2006 5 years from the issuance date 27th April 2011 Each Warrant Holder received 3 separate warrant certificates. Each certificate represented 1/3 of the total amount of warrants allotted and is exercisable for subscribing for ordinary shares as follows: The 1st Certificate: Warrant Holders can start exercising from the last business day of May 2006 until its expiration. nd The 2 Certificate: Warrant Holders can start exercising from the last business day of May 2007 until its expiration. rd The 3 Certificate: Warrant Holders can start exercising from the last business day of May 2008 until its expiration. : One unit of warrant entitles purchase of one ordinary share at Baht 9.73

: : : :

(2.3) Employee Stock Option Plan 2004 The Extraordinary General Meeting of the Shareholders No. 2/2547 held on 10th June 2004 approved the issuance and offering of non-transferable warrants to purchase the Company’s ordinary shares to certain Directors and employees at executive level of the Company and/or its subsidiaries not exceeding 35 persons (“ESOP 2004 Project”). Summary details are as follows: Number of Warrants Issued and Outstanding Date of Issuance Maturity Date of Expiry Exercise Period

18,274,444 units

: : : :

Exercise Ratio

7th February 2005 5 years from the issuance date 6th February 2010 Each Warrant Holder received 3 separate warrant certificates. Each certificate represented 1/3 of the total amount of warrants allotted and is exercisable for subscribing for ordinary shares as follows: The 1st Certificate: Warrant Holders can start exercising from 7th February 2006 until its expiration. nd The 2 Certificate: Warrant Holders can start exercising from 7th February 2007 until its expiration. rd The 3 Certificate: Warrant Holders can start exercising from 7th February 2008 until its expiration. One unit of warrant entitles purchase of one ordinary share at Baht 11.20

(2.4) Employee Stock Option Plan 2003 The Annual General Meeting of the Shareholders for the year 2003 held on 11th April 2003 approved the issuance and offering of non-transferable warrants to purchase the Company’s ordinary shares to certain Directors and employees at executive level of the Company and/or its subsidiaries not exceeding 35 persons (“ESOP 2003 Project”). Summary details are as follows: Number of Warrants Issued and Outstanding Date of Issuance Maturity Date of Expiry Exercise Period

: : : : :

Exercise Ratio

11,180,788 units (as of 31st December 2007) 17th June 2003 5 years from the issuance date 16th June 2008 Each Warrant Holder received 3 separate warrant certificates. Each certificate represented 1/3 of the total amount of warrants allotted and is exercisable for subscribing for ordinary shares as follows: The 1st Certificate: Warrant Holders can start exercising from 17th June 2004 until its expiration. nd The 2 Certificate: Warrant Holders can start exercising from 17th June 2005 until its expiration. The 3rd Certificate: Warrant Holders can start exercising from 17th June 2006 until its expiration. One unit of warrant entitles purchase of one ordinary share at Baht 5.20

(2.5) Employee Stock Option Plan 2002 Equity warrants under the ESOP 2002 Project of 37,131,597 units were issued to Directors and Employees at executive level of the Company and/or its subsidiaries on 14th June 2002. Each warrant entitles purchase of one Company common share at the exercise price of Baht 10.60 per share. The said warrants lapsed on 13th June 2007. (2.6) Employee Stock Option Plan 2000 The Annual General Meeting of the Shareholders for the year 2000 held on 27th April 2000 approved the issuance and offering of non-transferable warrants to purchase the Company’s ordinary shares to BETTER TOGETHER

certain Directors and employees at executive level of the Company and/or its subsidiaries not exceeding 35 persons (â&#x20AC;&#x153;ESOP 2000 Projectâ&#x20AC;?). Summary details are as follows: Number of Warrants Issued and Outstanding Date of Issuance Maturity Date of Expiry Exercise Period

36,995,000 units

: : : :

Exercise Ratio

9th June 2000 10 years from the issuance date 9th June 2010 (a) Warrant Type 1: Each Warrant Holder received 3 separate warrant certificates. Each certificate represented 1/3 of the total amount of warrants allotted and is exercisable for subscribing for ordinary shares starting from June 30, 2000, 2001 and 2002 respectively. (b) Warrant Type 2: Each Warrant Holder received 3 separate warrant certificates. Each certificate represented 1/3 of the total amount of warrants allotted and is exercisable for subscribing for ordinary shares starting from December 31, 2000, 2001 and 2002 respectively. One unit of warrant entitles purchase of one ordinary share at Baht 10.60

Details of warrants allotted to Directors and Executive Officers under ESOP Plan Name

1. Dr. Ajva Taulananda 2. Mr. Soopakij Chearavanont 3. Mr. Suphachai Chearavanont 4. Mr. Vichaow Rakphongphairoj 5. Mr. Chatchaval Jiaravanon 6. Mr. Athueck Asvanund 7. Mr. William Harris 8. Mr. Adhiruth Thothaveesansuk 9. Mr. Thiti Nantapatsiri 10. Mr. Songtham Phianpattanawit

Warrants under Warrants under Warrants under Warrants under Warrants under Warrants under ESOP 2006 ESOP 2005 ESOP 2004 ESOP 2003 ESOP 2002* ESOP 2000 % % % % % % No. of No. of of No. of of No. of of No. of No. of of of of warrants warrants warrants warrants warrants warrants project project project project project project -

3,200,000

8.88

1,900,000 10.12 2,434,077 12.74 3,696,402

18.61 7,058,824 19.01 6,510,000 17.60

1,600,000

4.44

1,000,000

5.33

1,277,890

6.69

1,617,176

8.14

3,088,235 8.32

2,800,000

300,000

0.83

350,000

1.86

1,277,890

6.69

1,940,611

9.77

3,705,882 9.98

4,130,000 11.16

2,000,000 1,600,000 1,600,000

5.55 4.44 4.44

1,200,000 1,000,000 1,000,000

6.39 5.33 5.33

1,331,136 1,277,890 1,277,890

6.97 6.69 6.69

2,021,470 1,297,838 850,404

10.18 3,860,294 10.40 5,320,000 14.38 6.53 3,000,000 8.08 945,000 2.55 4.28 1,503,662 4.05 -

1,600,000 1,600,000

4.44 4.44

1,000,000 1,000,000

5.33 5.33

1,277,890 1,277,890

6.69 6.69

2,240,000 6.06 4,130,000 11.16

7.57

Remark: Equity warrants under the ESOP 2002 Project lapsed on 13th June 2007.

Insider Trading Policy The Board of Directors is aware of the importance of protecting the Company from personal insider trading. The Company has a code of conduct regarding inside information and insider trading, as well as the use of applicable laws to monitor and prevent the personal use of confidential Company information by management and related persons. In addition, the Company has a policy of strict compliance to its requirement that Directors and senior management who have gained inside information on the Company by virtue of their positions do not use that information in any way that violates their responsibilities to the Company and its Shareholders. Material information which has not yet been disclosed is kept confidential, apart from disclosure to the relevant Director

ANNUAL REPORT 2007

and senior management of the Company. Directors and senior management must report purchases, sales, transfers and assignations of the securities issued by the Company to the Securities and Exchange Commission (“SEC”) within three days and provide a copy of this report to the Company for its records and incorporation in its regular report to the Board of Directors. In this regard, Directors and senior management are required to submit an accurate report on the securities holder within the required period. This will be deemed one of the material obligations which senior management of the Company need to be aware of and need to meet. This gives confidence to Directors and senior management that the business is being managed and developed in a manner which is trustworthy, clear and transparent, and which is consistent with measurements related to Good Corporate Governance Policy. It also provides shareholders, including general investors, with confidence in the Company’s senior management. Internal Control Based on an assessment of the Company’s internal control by the Audit Committee, the Board of Directors is of the opinion that the Company’s internal control is adequate and suitable. Moreover, the external auditor did not identify any findings in respect of the Company’s internal controls which would be considered to be material weaknesses that could have a material impact on the financial statements. However, the external auditor made some recommendations on the internal control of a subsidiary, which the management is in the process of implementing. The Board also emphasized the development of the Company’s corporate governance system in order to help improve the internal controls within the Company on a continuing basis. Personnel As of 31st December 2007, the total number of employees was as follows: Work Group and Classification Management Service Area & Network Operation Marketing & Sales Information Technology Customer Services Finance & Accounting Support Total

No. of Employees 79 1,880 983 228 461 223 297 4,151

Source : The Company Remuneration for the Company’s Employees Remuneration • Monthly Salary • Annual Performance Pay: between zero and 4 times the monthly salary, subject to the Company’s performance and financial status. • Retirement: the employee must be aged 60 years or can take early retirement with agreement between the Company and the employee. Severance pay will be paid accord to the labor law. In 2007, the total remuneration for employees was approximately Baht 2,504.07 million consisting of wages, salaries, social security cost, provident fund and other benefit. Other Compensation & Benefits - Health Plans and Employee Welfare • In-house clinic • Annual Medical Check-up • New Employees’ Medical Check-up BETTER TOGETHER

• • • • •

Group Health Insurance Group Accident Insurance Group Life Insurance Social Security Fund Provident Fund

- Annual Leave • The employee shall be entitled to paid annual leave of 10, 12 or 15 working days per calendar year dependent on the seniority of their position or their number of years of service as follows: • Assistant Director or equivalent level and upwards: 15 working days • Below Assistant Director or equivalent level: - Past probation to less than 3 years 10 working days - 3 years upwards to less than 5 years 12 working days - 5 years upwards 15 working days • The employee is required to take all annual leave entitlements by 31st December of each year otherwise the unused annual leave can not be accumulated to the subsequent year. • In case of urgent work requirements which mean the employee can not get approval for annual leave, unused annual leave can be accumulated and carried over to the subsequent year, limited to half of the entitlement, and not exceeding 5, 6 or 7 working days as appropriate. This matter is to be approved by an authorized superior and the employee is required to take the accumulated days within the first quarter of the subsequent year. Employee Training and Development Employee Training and Development Policy In order to help carry out the corporate strategy and achieve our goals, we encourage all employees to develop their knowledge, skills and attitude to be able to perform their jobs more effectively and improve their competencies with a view to career advancement. Presently, the company provides employees with an ongoing series of training and development programs. The core competency program includes courses such as Effective Communication, Planning to Increase Work Efficiency and Effective Self Development, etc. The functional competency program includes courses such as Accounting Standards, Project Management, Contract Management and Sales Planning and Management, etc. The core business program includes courses such as Datacommunication and Networking, True Products and Services and Cisco Certified Network Associate (CCNA), Microsoft Server, etc. There are approximately 300 – 400 inhouse training programs per year. In 2007, the training manday reached 48,515, with a budget of Baht 37 million.

ANNUAL REPORT 2007

DIRECTORâ&#x20AC;&#x2122;S INFORMATION (AS OF 31ST DECEMBER 2007) Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : : :

Mr. Narong Srisa-an Independent Director 80 10,000 shares Honorary Master Degree of Economics, Thammasat University : Director Accreditation Program (DAP)

Related training programs held by the Thai Institute of Directors Association (IOD) Major Experience : Companies Listed on the Stock Exchange of Thailand 1998-Present Independent Director, True Corporation Public Company Limited Present Chairman, Advance Agro Public Company Limited Chairman and Chairman of Executive Board, Oishi Group Public Company Limited Non-listed Companies Present Vice Chairman and Vice Executive Chairman, Thai Beverage Public Company Limited Vice Chairman and Executive Chairman, Beer Thai (1991) Public Company Limited Chairman, Thai Alcohol Public Company Limited Chairman, Sura Banyeekhan Company Limited Chairman of Executive Board, Thai Beverage Can Limited Chairman, Thanakorn Vegetable Oil Products Company Limited Chairman, Prida Pramote Company Limited Executive Director, Com-link Company Limited

BETTER TOGETHER

Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

Mr. Vitthya Vejjajiva Independent Director and Chairman of the Audit Committee 71 Master of Laws, Harvard University, USA Master of Arts, University of Cambridge, England Bachelor of Laws, University of Cambridge, England Barrister-at-law, Grayâ&#x20AC;&#x2122;s Inn Related training programs held : Director Accreditation Program (DAP) by the Thai Institute of Directors Audit Committee Program (ACP) Association (IOD) Chairman 2000 Major Experience : Companies Listed on the Stock Exchange of Thailand Independent Director and Chairman of the Audit Committee, 1998-Present True Corporation Public Company Limited Non-listed Companies 1998-Present Chairman, K Line (Thailand) Company Limited and its subsidiaries 1991-1992 Permanent Secretary of the Ministry of Foreign Affairs 1988 Ambassador Extraordinary and Plenipotentiary of the United States of America 1984 Ambassador Extraordinary and Plenipotentiary of Belgium and the European Community 1981 Ambassador Extraordinary and Plenipotentiary of Canada 1979 Director, General of Department of Economic Affairs

ANNUAL REPORT 2007

: : : : : :

Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : : :

Dr. Kosol Petchsuwan Independent Director and Member of the Audit Committee 68 Doctor of Philosophy (Engineering), Imperial College London Bachelor of Engineering, Imperial College London Related training programs held : Director Accreditation Program (DAP) by the Thai Institute of Directors Director Certification Program (DCP) Association (IOD) Audit Committee Program (ACP) Chairman 2000 Major Experience : Companies Listed on the Stock Exchange of Thailand 1999-Present Independent Director and Member of the Audit Committee, True Corporation Public Company Limited 2004-Present Independent Director and Chairman of the Audit Committee, ACL Bank Public Company Limited Non-listed Companies 2001-Present Director, Mahidol Wittayanusorn School (Public Organization) 2001-2005 President, The Telecommunications Association of Thailand under Royal Patronage 2000-2001 Chairman, The Aeronautical Radio of Thailand Limited 1986-1992 Rector, King Mongkutâ&#x20AC;&#x2122;s Institute of Technology Ladkrabang Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : : :

Mr. Joti Bhokavanij Independent Director and Member of the Audit Committee 65 Fellow of the Association of Chartered Certified Accountants, England Programme for Management Development, Harvard Business School, USA Marketing Management Programme, Stanford University, Graduate School of Business, USA Related training programs held : Director Accreditation Program (DAP) by the Thai Institute of Directors Chairman 2000 Association (IOD) Major Experience : Companies Listed on the Stock Exchange of Thailand 1999-Present Independent Director and Member of the Audit Committee, True Corporation Public Company Limited 2004-2006 Chief Executive Officer, ACL Bank Public Company Limited 2000-2001 Executive Chairman, TISCO Finance Public Company Limited 1994-1997 President & CEO, Thai Wah Group of Companies 1992-1994 Managing Director and Consul-General of Denmark for Bangkok The East Asiatic (Thailand) Public Company Limited Non-listed Companies 2002-Present Director, True Move Company Limited BETTER TOGETHER

Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : : :

Mr. Dhanin Chearavanont Chairman 68 Mr. Soopakij’s and Mr. Suphachai’s father Commercial School, Hong Kong Shantou Secondary School, The People’s Republic of China The National Defence College of Thailand : Director Accreditation Program (DAP)

Related training programs held by the Thai Institute of Directors Association (IOD) Major Experience : Companies Listed on the Stock Exchange of Thailand Present Chairman, True Corporation Public Company Limited Chairman, Charoen Pokphand Foods Public Company Limited Chairman, CP All Public Company Limited Honorary Chairman, Siam Makro Public Company Limited Non-listed Companies Chairman, Subsidiaries of True Corporation Public Company Limited Present Chairman, True Move Company Limited Chairman and Chief Executive Officer, Charoen Pokphand Group Company Limited and its subsidiaries Chairman, Subsidiaries of Charoen Pokphand Foods Public Company Limited Chairman, Subsidiaries of CP All Public Company Limited Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education Related training programs held by the Thai Institute of Directors Association (IOD) Major Experience

ANNUAL REPORT 2007

: : : : : : :

Mr. Sumet Jiaravanon Vice Chairman 73 150,000 shares Mr. Chatchaval’s father Secondary School, Sarasitphitayalai, Ratchaburi -

: Companies Listed on the Stock Exchange of Thailand 1993-Present Vice Chairman, True Corporation Public Company Limited Non-listed Companies 1993-Present Executive Chairman, Charoen Pokphand Group Company Limited Present Director, Subsidiaries of True Corporation Public Company Limited

Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : : :

Dr. Ajva Taulananda Vice Chairman 70 Honorary Doctorate of Management, The University of Thai Chamber of Commerce Honorary Doctorate of Engineering, Ramkhamhaeng University Honorary Doctorate of Engineering, Chulalongkorn University Doctorate of Industrial Engineering and System, Illinois Institute of Technology, USA Master Degree of Industrial Engineering, Iowa State of University, USA Bachelor of Industrial Engineering, Chulalongkorn University Special Certificate: Public - Private joint defence curricum, Class 1, The National Defence College of Thailand Related training programs held : Director Accreditation Program (DAP) by the Thai Institute of Directors Chairman 2000 Association (IOD) Director Certification Program (DCP) Major Experience : Companies Listed on the Stock Exchange of Thailand 1992-Present Vice Chairman, True Corporation Public Company Limited 1993-1999 Director and President, True Corporation Public Company Limited Non-listed Companies 1992-Present Vice Chairman, Charoen Pokphand Group Company Limited Honorary Chairman, The Thai Chamber of Commerce and Board of Trade of Thailand 1991-1992 Deputy Minister, Ministry of Agriculture and Cooperatives Director, Subsidiaries of True Corporation Public Company Limited Present Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : : :

Mr. Chaleo Souvannakitti Vice Chairman 79 3,350,000 shares Master Degree of Business Administration, Indiana University, USA Bachelor of Accounting, Faculty of Commerce and Accountancy, Chulalongkorn University : -

Related training programs held by the Thai Institute of Directors Association (IOD) Major Experience : Companies Listed on the Stock Exchange of Thailand 1992-Present Vice Chairman, True Corporation Public Company Limited Non-listed Companies 1992-Present Director, Telecom Holding Company Limited Director, Subsidiaries of True Corporation Public Company Limited Present

BETTER TOGETHER

Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : : :

Mr. Athueck Asvanund* Vice Chairman and Group General Counsel 56 1,000,046 shares Master Degree of Laws, specialized in International Legal Studies, New York University, USA Bachelor of Laws (Honours), Thammasat University : Capital Market Academy Leader Program : Director Accreditation Program (DAP)

Training Related training programs held by the Thai Institute of Directors Association (IOD) Major Experience : Companies Listed on the Stock Exchange of Thailand 1997-Present Vice Chairman and Group General Counsel, True Corporation Public Company Limited Advisor to the Board of Directors, CP All Public Company Limited Non-listed Companies 1997-Present Vice Chairman and Group General Counsel, Subsidiaries of True Corporation Public Company Limited Group General Counsel, Charoen Pokphand Group Company Limited and its subsidiaries Director, True Visions Public Company Limited and its subsidiaries 2002-Present Director, True Move Company Limited Present Director, Aqua-Agri Foods International, Inc. 2001-2006 Associate Judge, Central Intellectual Property and International Trade Court 1978-1997 Baker & McKenzie Present Part-time Lecturer, Business Law, Faculty of Law, Chulalongkorn University

*Authorized Signatory 96 ANNUAL REPORT 2007

Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : :

Mr. Suphachai Chearavanont* Director, President and Chief Executive Officer 40 1,250,000 shares Mr. Dhanin’s son Mr. Supakij’s younger brother : Bachelor of Business Administration in Financial Management Boston University, USA : -

Related training programs held by the Thai Institute of Directors Association (IOD) Major Experience : Companies Listed on the Stock Exchange of Thailand True Corporation Public Company Limited 1999-Present President and Chief Executive Officer 1997 Senior Executive Vice President 1996 Executive Vice President, Business Operations 1995 General Manager, East Region 1994 Senior Vice President, Planning and Project Coordination & Support 1993 Vice President, the Operation Room 1992 Senior Officer, the President’s Office Non-listed Companies 2006-Present Chief Executive Officer, True Visions Public Company Limited 2002-Present Chief Executive Officer, True Move Company Limited 2001-Present Chairman, Pantavanij Company Limited 2000-2005 Chairman, Freewill Solutions Company Limited 1999-Present Chairman, Wire & Wireless Company Limited 1996 President, Asia Multimedia Company Limited 1995 Chief Operating Officer, True Visions Cable Public Company Limited (Formerly named UTV Cable Network Public Company Limited) Managing Director, Wire & Wireless Company Limited 1991 2 Years with Vinythai Company Limited 1990 1 Year with Soltex Federal Credit Union, USA 1989 1 Year with Siam Makro Company Limited Directorships - True Corporation Public Company Limited - True Move Company Limited - True Visions Public Company Limited - Other subsidiaries of True Corporation Public Company Limited - Pantavanij Company Limited - CPPC Public Company Limited - Chia Tai Enterprises International Limited - Chia Tai International Finance Company Limited - Shanghai Lotus Supermarket Chain Store Company Limited Social Contributions & Other Experience 2007-Present Member of the Bid Committee of Bangkok for the Host City of the 1st Summer Youth Olympic Games in 2010, Ministry of Tourism & Sports 2006-Present Member of the Thai Red Cross Eyebank Committee 1999-Present Director & Advisor of the Telecommunications Association of Thailand under the Royal Patronage (TCT) 2005-2007 Member of the Listed Companies Association (LCA) *Authorized Signatory BETTER TOGETHER 97

Name Position Age (year) True Share Ownership (31/12/07) Family Relationship

: : : : :

Mr. Soopakij Chearavanont* Director 44 Mr. Dhanin’s son Mr. Suphachai’s elder brother : Bachelor of Business Administration, New York University, USA : -

Education Related training programs held by the Thai Institute of Directors Association (IOD) Major Experience : Companies Listed on the Stock Exchange of Thailand Present Director, True Corporation Public Company Limited Director, CP All Public Company Limited Non-listed Companies Present Co-Chairman, Shanghai Kinghill Limited - Super Brand Mall Chairman, Chia Tai Enterprises International Limited Chairman, True Visions Public Company Limited Executive Chairman, Telecom Holding Company Limited Chief Executive Officer, Real Estate & Land Development Business (China), Charoen Pokphand Group Company Limited Vice Chairman, Automotive Industrial Products and Finance Business, Charoen Pokphand Group Company Limited Vice Chairman, Real Estate and Land Development Business (Thailand) Charoen Pokphand Group Company Limited Vice Chairman, Marketing and Distribution Business (China), Charoen Pokphand Group Company Limited Director, True Move Company Limited Director, Subsidiaries of True Corporation Public Company Limited Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : : :

Mr. Chatchaval Jiaravanon* Director and Managing Director-Group Investment 45 Mr. Sumet’s son Bachelor of Science Business Administration University of Southern California, USA : Director Accreditation Program (DAP)

Related training programs held by the Thai Institute of Directors Association (IOD) Major Experience : Companies Listed on the Stock Exchange of Thailand 1993-Present Director and Managing Director - Group Investment, True Corporation Public Company Limited 2001-Present Director and Member of the Audit Committee, Ticon Industrial Connection Public Company Limited Non-listed Companies 2000-Present President and CEO, Telecom Holding Company Limited 1997-Present CEO, True Multimedia Company Limited, True Internet Company Limited and Asia Infonet Company Limited 2006-Present Chairman, Thai Kodama Company Limited 1992-2005 Director, Thai Kodama Company Limited 1990-Present Director, Metro Machinery Company Limited Present Director, Subsidiaries of True Corporation Public Company Limited *Authorized Signatory 98 ANNUAL REPORT 2007

Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : : :

Mr. Vichaow Rakphongphairoj* Director, Managing Director and Chief Operating Officer 50 364,058 shares Master Degree of Business Administration, Pepperdine University, USA Master Degree of Electrical Engineering, University of Wisconsin, USA Bachelor of Electrical Engineering, Arizona State University, USA : Director Certification Program (DCP)

Related training programs held by the Thai Institute of Directors Association (IOD) Major Experience : Companies Listed on the Stock Exchange of Thailand True Corporation Public Company Limited 2000-Present Director, Managing Director and Chief Operating Officer 1998-2000 E.V.P., Business & Enterprise 1997-1998 E.V.P., Central Operation & Information Technology 1996-1997 Region Director, Bangkok-Southeast Region 1995-1996 Region Director, Bangkok-West Region Non-listed Companies Present Director, Subsidiaries of True Corporation Public Company Limited Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : : :

Mr. Umroong Sanphasitvong Director 55 384,000 shares Master Degree of Accounting, Thammasat University Bachelor of Accounting, Thammasat University : Director Certification Program (DCP)

Related training programs held by the Thai Institute of Directors Association (IOD) Major Experience : Companies Listed on the Stock Exchange of Thailand 2001-Present Director, True Corporation Public Company Limited Present Director, CP All Public Company Limited Non-listed Companies Present Deputy Group CFO, Charoen Pokphand Group Company Limited Director, Ayudhya Allianz C.P. Life Public Company Limited Director, CPPC Public Company Limited Aug 1, 2003-Present Director, VinaSiam Bank

*Authorized Signatory

BETTER TOGETHER

Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : : :

Mr. Jens B. Bessai Director 37 Master Degree of Business Administration of J.W. Goethe-University of Frankfurt am Main, Germany : -

Related training programs held by the Thai Institute of Directors Association (IOD) Major Experience : Companies Listed on the Stock Exchange of Thailand 2007-Present Director, True Corporation Public Company Limited Non-listed Companies 2007-Present Head of KfW’s South-East Asia Regional Office, Bangkok 2006-2007 Senior Officer of KfW’s South-East Asia Regional Office, Bangkok 1998-2006 KfW Export and Project Finance, Frankfurt am Main 1990-1992 Deutsche Bank, Osnabruck Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education Related training programs held by the Thai Institute of Directors Association (IOD) Major Experience

100 ANNUAL REPORT 2007

: : : : : : :

Mr. Norbert Vay Director 56 MBA (Dipl. Kaufmann): University of Mannheim -

: Companies Listed on the Stock Exchange of Thailand Director, True Corporation Public Company Limited 2007-Present Non-listed Companies 2004-Present KfW First Vice President & Head of Department 1988-2004 KfW Vice President & Deputy Head of Department (Asset Finance and Export & Project Finance) 1981-1988 KfW Project Manager Aircraft & Export - Financing 1978-1981 BHF-Bank branch manager

Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education Related training programs held by the Thai Institute of Directors Association (IOD) Major Experience

: : : : : : :

Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : : :

Mr. Harald Link Director 53 50,000 shares MBA, St. Gallen University, Switzerland -

: Companies Listed on the Stock Exchange of Thailand 2000-Present Director, True Corporation Public Company Limited 1998-Present Director, Siam City Cement Public Company Limited Non-listed Companies 1987-Present Managing Partner, B. Grimm & Co. R.O.P. Chairman, B. Grimm Group of Companies

Dr. Lee G. Lam Director 48 Doctorate of Philosophy, University of Hong Kong Master Degree of Systems Science and MBA, University of Ottawa, Canada Bachelor of Sciences and Mathematics, University of Ottawa, Canada Post-graduate Diploma of Public Administration, Carleton University, Canada Post-graduate Diploma in English and Hong Kong Law, Manchester Metropolitan University, U.K. LLB (Hons) in Law, Manchester Metropolitan University, U.K. Related training programs held : Director Accreditation Program 65 (DAP65) – Governance by the Thai Institute of Directors Training for Listed Company Director (date: August 7, 2007) Association (IOD) Major Experience : Companies Listed on the Stock Exchange of Thailand 2003-Present Director, True Corporation Public Company Limited Companies Listed on the Hong Kong Stock Exchange 2003-Sep 15, 2006 President & CEO / Vice Chairman of the Board Chia Tai Enterprises International Limited Non-listed Companies 2001-2003 Managing Director, BOC International Holdings Limited (“BOCI”) 1999-2001 Executive Director, Singapore Technologies Telemedia 1998-1999 Partner-in-charge, Heidrick & Struggles 1996-1998 President & CEO, Millicom International Cellular Asia Pacific Operations 1993-1995 Managing Partner, A.T. Kearney, Inc. 1989-1993 General Manager, Cable & Wireless/Hongkong Telecom 1981-1989 Senior Executive, Bell Canada BETTER TOGETHER 101

Executive Officers’ Information (As of 31st December 2007) Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : :

Mr. Suphachai Chearavanont Director, President and Chief Executive Officer 40 1,250,000 shares Mr. Dhanin’s son Mr. Supakij’s younger brother : Bachelor of Business Administration in Financial Management Boston University, USA : -

102 ANNUAL REPORT 2007

Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : : :

Mr. Vichaow Rakphongphairoj Director, Managing Director and Chief Operating Officer 50 364,058 shares Master Degree of Business Administration, Pepperdine University, USA Master Degree of Electrical Engineering, University of Wisconsin, USA Bachelor of Electrical Engineering, Arizona State University, USA : Director Certification Program (DCP)

Related training programs held by the Thai Institute of Directors Association (IOD) Major Experience : Companies Listed on the Stock Exchange of Thailand True Corporation Public Company Limited 2000-Present Director, Managing Director and Chief Operating Officer 1998-2000 E.V.P., Business & Enterprise 1997-1998 E.V.P., Central Operation & Information Technology 1996-1997 Region Director, Bangkok-Southeast Region 1995-1996 Region Director, Bangkok-West Region Non-listed Companies Present Director, Subsidiaries of True Corporation Public Company Limited

BETTER TOGETHER 103

Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : : :

Mr. Chatchaval Jiaravanon Director and Managing Director - Group Investment 45 Mr. Sumetâ&#x20AC;&#x2122;s son Bachelor of Science Business Administration University of Southern California, USA : Director Accreditation Program (DAP)

104 ANNUAL REPORT 2007

Name Position Age (year) True Share Ownership (31/12/06) Family Relationship Education

: : : : : :

Mr. Athueck Asvanund Vice Chairman and Group General Counsel 56 1,000,046 shares Master Degree of Laws, specialized in International Legal Studies, New York University, USA Bachelor of Laws (Honours), Thammasat University : Capital Market Academy Leader Program : Director Accreditation Program (DAP)

BETTER TOGETHER 105

Name Position Age (year) True Share Ownership (01/01/08) Family Relationship Education

: : : : : :

Mr. Noppadol Dej-Udom Chief Financial Officer 40 Master Degree in Business Administration, Sasin Graduate Institute of Business Administration of Chulalongkorn University Bachelor Degree in Mechanical Engineering, Rensselaer Polytechnic Institute, USA : -

Related training programs held by the Thai Institute of Directors Association (IOD) Major Experience : Companies Listed on the Stock Exchange of Thailand True Corporation Public Company Limited Present Chief Financial Officer 2003 â&#x20AC;&#x201C;2007 Director & General Manager - Online 2000 - 2003 Senior Vice President - Corporate Finance 1998 - 2000 Vice President - Strategic Planning & Business Development Department Non-listed Companies Present Director, True Internet Company Limited Director, True Internet Data Center Company Limited Director, True Universal Convergence Company Limited Director, True International Communication Company Limited Director, Future Gamer Company Limited Director, MKSC World Dot Com Company Limited Director, Internet Knowledge Service Center Company Limited Director, True Music Company Limited Director, KSC Commercial Internet Company Limited Director, Internet Shopping Mall Company Limited Director, Online Advertising Goldsite Company Limited Director, Telecom KSC Company Limited Director, BeBoydCG Company Limited Director, NC True Company Limited 2007 - 2007 Managing Director, True Universal Convergence Company Limited 2007 - 2007 Managing Director, True Public Communication Company Limited 2007 - 2007 Managing Director, True International Communication Company Limited 2006 - 2007 Managing Director, True Internet Gateway Company Limited 2005 - 2007 Managing Director, True Digital Entertainment Company Limited 2003 - 2007 Managing Director, True Internet Company Limited 1997 - 1998 Vice President, Corporate Finance & Business Development Department, Asia Multimedia Company Limited

106 ANNUAL REPORT 2007

Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : : :

Mr. Adhiruth Thothaveesansuk Managing Director - Office / SME Solution & Wireless Access 44 850,404 shares Master Degree of Finance & Marketing, Indiana University of Pennsylvania, USA Bachelor of Industrial Management, Thammasat University Related training programs held : Director Certification Program (DCP) by the Thai Institute of Directors Director Diploma of Australian Institution of Director 2005 Association (IOD) Major Experience : Companies Listed on the Stock Exchange of Thailand Present Managing Director - Office / SME Solution & Wireless Access True Corporation Public Company Limited 2001 Executive Vice President, True Corporation Public Company Limited Non-listed Companies Present President, Asia Wireless Communication Company Limited President, True Money Company Limited Director, True Visions Public Company Limited 2002 Chief Commercial Officer, True Move Company Limited 1998-2002 General Manager, Wire & Wireless Company Limited 1998-2001 President, Asia Wireless Communication Company Limited

BETTER TOGETHER 107

Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education Related training programs held by the Thai Institute of Directors Association (IOD) Major Experience

108 ANNUAL REPORT 2007

: : : : : : :

Mr. Songtham Phianpattanawit Managing Director - Corporate Solution, Wholesales & Data 49 220,700 shares Bachelor of Science (Computer Science), University of South Alabama, USA Director Certification Program (DCP no.54)

: Companies Listed on the Stock Exchange of Thailand Present Managing Director - Corporate Solution, Wholesales & Data, True Corporation Public Company Limited Non-listed Companies Present Executive Director - Corporate Solution, True Move Company Limited Acting President, True Multimedia Company Limited Acting President, Wire & Wireless Company Limited President, True Internet Data Center Company Limited Executive Committee, Pantavanij Company Limited Director, Freewill Solution Company Limited 2006-Present Director, True Internet Gateway Company Limited Director, Bangkok Inter Teletech Public Company Limited 2001-2003 Country General Manager / MD, IBM Thailand Company Limited Chairman, IBM Solution Delivery Company Limited 2001-2002 Director, IBM Storage Product Thailand Company Limited 2000 Director, Sales & Marketing, IBM Thailand Company Limited Country Manager System Sales, IBM Thailand Company Limited 1998 Country Manager Finance & Administration and CFO, IBM Thailand Company Limited 1997 Service Business Executive, IBM Thailand Company Limited

Name Position Age (year) True Share Ownership (31/12/07) Family Relationship Education

: : : : : :

Mr. Thiti Nantapatsiri Managing Director - Home / Consumer Solution & Highspeed Access 53 Bachelor Degree of Engineering (Electrical), King Mongkutâ&#x20AC;&#x2122;s Institute of Technology, Ladkrabang Campus : -

Related training programs held by the Thai Institute of Directors Association (IOD) Major Experience : Companies Listed on the Stock Exchange of Thailand Present Managing Director - Home / Consumer Solution & Highspeed Access, True Corporation Public Company Limited 1999-2003 Executive Vice President, Loxley Public Company Limited 1997-1999 First Senior Vice President, Loxley Public Company Limited Non-listed Companies 2001-2002 President & CEO, Hutchison CAT Wireless Multimedia Company Limited 1992-2000 President & CEO, Hutchison Telecommunications (Thailand) Company Limited Present Director, Subsidiaries of True Corporation Public Company Limited

BETTER TOGETHER 109

The Company Directors’ Shareholding in True’s affiliates as of 31st December 2007 are as follows: Director

Company

Change In 2007

Outstanding Share(s)

Mr. Dhanin

Chearavanont

Telecom Holding Co., Ltd. Bangkok Inter Teletech Public Company Limited

1 1

Mr. Sumet

Jiaravanon

Bangkok Inter Teletech Public Company Limited

Mr. Chaleo

Souvannakitti

Telecom Holding Co., Ltd. Telecom International Co., Ltd. Telecom Equipment Manufacturing Co., Ltd.

1 1 1

Dr. Ajva Taulananda

Telecom International Co., Ltd. Telecom Training and Development Co., Ltd. Telecom Equipment Manufacturing Co., Ltd. True Touch Co., Ltd. True Multimedia Co., Ltd. Asia DBS Public Company Limited Asia Infonet Co., Ltd. Asia Wireless Communication Co., Ltd. True Internet Co., Ltd. True Lifestyle Retail Co., Ltd.

1 1 1 1 1 1 1 1 1 1

Mr. Chatchaval Jiaravanon

Telecom International Co., Ltd. Telecom Equipment Manufacturing Co., Ltd. Wire & Wireless Co., Ltd. True Touch Co., Ltd. True Internet Co., Ltd. Asia DBS Public Company Limited Asia Infonet Co., Ltd. Asia Wireless Communication Co., Ltd. True Multimedia Co., Ltd. True Lifestyle Retail Co., Ltd. True Internet Data Center Co., Ltd.

1 1 5 1 1 1 1 1 1 1 1

Mr. Soopakij Chearavanont

1 1 1 1 1 1 1 1

110 ANNUAL REPORT 2007

Director

Company

Change In 2007

Outstanding Share(s)

Mr. Suphachai Chearavanont

Telecom Holding Co., Ltd. Telecom International Co., Ltd. Telecom Training and Development Co., Ltd. Telecom Equipment Manufacturing Co., Ltd. Wire & Wireless Co., Ltd. True Touch Co., Ltd. True Internet Co., Ltd. Asia DBS Public Company Limited Asia Infonet Co., Ltd. Asia Wireless Communication Co., Ltd. True Multimedia Co., Ltd. True Money Co., Ltd. NC True Co., Ltd. True Internet Data Center Co., Ltd. Bangkok Inter Teletech Public Company Limited True Distribution and Sales Co., Ltd.

1 -

1 1 1 1 5 1 1 1 1 1 1 1 1 1 1 1

Mr. Athueck Asvanund

True Money Co., Ltd. Bangkok Inter Teletech Public Company Limited

1 1

Mr. Harald Link

Telecom Equipment Manufacturing Co., Ltd.

480,000

Mr. Vichaow Rakphongphairoj

Telecom International Co., Ltd. Telecom Equipment Manufacturing Co., Ltd. True Touch Co., Ltd. True Internet Co., Ltd. Asia DBS Public Company Limited Asia Infonet Co., Ltd. Asia Wireless Communication Co., Ltd. True Multimedia Co., Ltd. K.I.N. (Thailand) Co., Ltd. True Money Co., Ltd. True Magic Co., Ltd. Bangkok Inter Teletech Public Company Limited

1 1 1 1 1 1 1 1 1 1 1 1

BETTER TOGETHER 111

Connected Transactions i ) During 2007, the Group carried out the transaction with subsidiaries, associate, joint ventures and related companies as disclosed in the interim financial statements for the year ended 31st December 2007 (Note 11). The significant connected transactions of the Company and subsidiaries that carried out with associate and related companies are as follows: Company Name

Relationship

Details of transactions

2007

(Baht’000)

Rationale and necessity

1. Company 1.1 Charoen Pokphand Group of companies (CPG)

CPG is a major shareholder of the Company.

Sale : - Sale of Lan Network - Coin distribution service and service other Purchase : - Commission from public phone - Office rental and related services

- Development purchasing system - Other services - Computer software - Communication equipment 1.2 NEC Corporation (Thailand) Co., Ltd. (NEC)

1.3 BeboydCg Company Limited (Bboyd)

The Company indirectly holds 9.62% in NEC’s equity interest and related through directorship, i.e. Mr. Chatchaval Jiaravanon.

Sale : - Engineering and management service in associate with DDN Purchase : - Repair and maintenance network services. - Equipment for repair and maintenance.

The Company indirectly holds 70.00% in Bboyd’s equity interest and related through directorship, i.e. Mr. Suphachai Chearavanont.

Purchase : - Right

112 ANNUAL REPORT 2007

2,606 - The transactions arose in ordinary course of business that the Company proposed to the third party. 4,478 - The transactions arose in ordinary course of business that the Company proposed to the third party. 1,098 - The transactions arose in ordinary course of business at rate 5-10% of connected revenues. 23,158 - The transactions arose in ordinary course of business at the rate of Baht 200 – 220 per square metre per month for rental and Baht 220 – 520 per square metre per month for service. The maturity is normally in the year and are allowed to be renewed. 17,589 - The transactions arose in ordinary course of business. 36,986 - The transactions arose in ordinary course of business. 29,571 - The transactions arose in ordinary course of business. 48,207 - The transactions arose in ordinary course of business. 164 - The transactions arose in ordinary course of business, net of discount rate. 170 - The transactions arose in ordinary course of business. 129 - The transactions arose in ordinary course of business. 3,000 - The transactions arose in ordinary course of business.

Company Name

Relationship

1.4 True Internet Data The Company indirectly Center Co., Ltd. (TIDC) holds 70.00% in TIDC’s equity interest and related through directorships, i.e. Mr. Chatchaval Jiaravanon.

Details of transactions Sale : - Accessories and services related to fixed line Purchase : - Internet server rental - Other service

2007

(Baht’000)

Rationale and necessity

160 - The transactions arose in ordinary course of business that the Company proposed to the third party. 2,918 - The transactions arose in ordinary course of business at the rate of Baht 810,536.60 per month. The maturity are normally in the year and are allowed to be renewed. 6,325 - The transactions arose in ordinary course of business.

2. Bangkok Inter Teletech Group of companies (BITCO) (The Company directly and indirectly holds 75.26%) 2.1 Charoen Pokphand Group of Companies (CPG)

CPG is a major shareholder of the Company. BITCO is the cellular telephone operator which the Company directly holds 72.07% and indirectly holds 3.19% of its equity interest. These companies are related through directorships.

2.2 True Internet Data The Company indirectly holds Center Co., Ltd. (TIDC) 70.00% in TIDC’s equity interest and BITCO is the cellular telephone operator which the Company directly holds 78.26% and indirectly holds 15.10% of its equity interest. These companies are related through directorships., i.e. Mr. Songtham Phianpattanawit

Sale : - Sales of mobile handset 13,143 - The transactions arose in ordinary course of and accessories business that BITCO proposed to the third party. - Refill Card

5,145,280 - The transactions arose in ordinary course of business that BITCO proposed to the third party.

Purchase : - Office rental and related services

29,213 - The transactions arose in ordinary course of business at the rate of Baht 816,988 per month. The maturity are normally in 3 year and are allowed to renewed - Commission from refill 400,451 - The transactions arose in ordinary course of card and other service business. - Telephone 48,927 - The transactions arose in ordinary course of business. Sale : - Other services

2,084 - The transactions arose in ordinary course of business that the Company proposed to the third party.

3. True Multimedia Co., Ltd. (TM) (The Company indirectly holds 91.08%) 3.1 Asia Infonet Co., Ltd. (AI)

The Company indirectly holds 91.08% in TM’s equity interest and 65.00% in AI’s equity interest. These companies are related through directorship.

Sale : - Digital Data Network services

3.2 KSC Commercial The Company indirectly Internet Co., Ltd. (KSC) holds 91.08% in TM’s equity interest and 37.80% in KSC’s equity interest. These companies are related through directorship, i.e. Mr. Suphachai Chearavanont and Mr. Athueck Asvanund.

Sale : - Digital Data Network services

3.3 Charoen Pokphand Group of companies (CPG)

Sale : - Digital Data Network services

CPG is a major shareholder of the Company. The Company indirectly holds 91.08% in TM’s equity interest. These companies are related through directorships.

3.4 True Internet Data The Company indirectly Center Co., Ltd. (TIDC) holds 70.00% in TIDC’s equity interest and 91.08% in TM’s equity interest. These companies are related through directorship, i.e. Mr. Chatchaval Jiaravanon.

Purchase : - Other services Purchase : -Revenue sharing

8,334 - The transactions arose in ordinary course of business that the Company proposed to the third party.

9,230 - The transactions arose in ordinary course of business that the Company proposed to the third party.

34,796 - The transactions arose in ordinary course of business that the Company proposed to the third party. 21 - The transactions arose in ordinary course of business. 1,022 - The transactions arose in ordinary course of business that the Company proposed to the third party.

BETTER TOGETHER 113

Company Name

Relationship

Details of transactions

2007

(Baht’000)

Rationale and necessity

4. True Internet Co., Ltd. (TI) (The Company directly holds 99.99%) 4.1 Charoen Pokphand Group of companies (CPG)

CPG is a major shareholder of the Company. The Company directly holds 99.99% in TI’s equity interest. These companies are related through directorships.

Sale: - Internet services Purchase : - Office rental and related services - Purchase of goods

4.2 KSC Commercial The Company directly holds Internet Co., Ltd. (KSC) 99.99% in TI’s equity interest and indirectly holds 37.80% in KSC’s equity interest. These companies are related through directorships, i.e. Mr. Suphachai Chearavanont, Mr. Noppadol Dej-Udom, and Mr. Thiti Nantapatsiri. 4.3 Asia Infonet Co., Ltd. (AI)

The Company directly holds 99.99% in TI’s equity interest and indirectly holds 65.00% in AI’s equity interest. These Companies are related through directorships, i.e. Mr. Noppadol Dej-Udom.

4.4 True Internet Data The Company directly holds Center Co., Ltd. (TIDC) 99.99% in TI’s equity and indirectly holds 70.00 in TIDC’s equity interest. These companies are related through directorships, I.e. Mr. Noppadol Dej-Udom

sale : Internet services Purchase : - Rental network - Purchase of goods

Purchase : - Corporate internet services - Office equipment

Sale : - Internet services Purchase : - Revenue sharing

3,997 - The transactions arose in ordinary course of business that TI proposed to the third party. 14,356 - The transactions arose in ordinary course of business at the rate of Baht 149,688 per month. The maturity are normally in the year and are allowed to be renewed. 5,998 - The transactions arose in ordinary course of business 12,698 - The transactions arose in ordinary course of business that TI proposed to the third party. 10,320 - The transactions arose in ordinary course of business. 343 - The transactions arose in ordinary course of business.

320,872 - The transactions arose in ordinary course of business. 3 - The transactions arose in ordinary course of business.

3,329 - The transactions arose in ordinary course of business that TI proposed to the third party. 17,031 - The transactions arose in ordinary course of business.

5. True Properties Co., Ltd. (TP) (The Company indirectly holds 99.99%) 5.1 Charoen Pokphand Group of Companies (CPG)

CPG is a major shareholder of the Company. The Company indirectly holds 99.99% in TP’s equity interest. These companies are related through directorships.

Sale : - Office rental and related services

5.2 NC True Co., Ltd. (NC The Company holds TRUE) 40.00% in NC True’s equity interest and indirectly holds 99.99% in TP’s equity interest.

Sale : - Office rental and related services

5.3 True Internet Data Center Co., Ltd. (TIDC)

Sale : - Office rental and related services

The Company indirectly holds 99.99% in TP’s equity interest and 70.00% in TIDC’s equity interest. These companies are related through directorships, i.e. Mr. Chatchaval Jiaravanon.

114 ANNUAL REPORT 2007

Purchase : - Other services

9,145 - The transactions arose in ordinary course of business at the rate of Baht 455 per square metre. The maturity are normally in 3 year and are allowed to be renewed. 1,638 - The transactions arose in ordinary course of business. 4,820 - The transaction arose in ordinary course of business at the rate of Baht 455 per square metre. The maturity are normally in one year and are allowed to be renewed. 3,260 - The transaction arose in ordinary course of business at the rate of Baht 455 per square metre. The maturity are normally in one year and are allowed to be renewed.

Company Name

Relationship

Details of transactions

2007

(Baht’000)

Rationale and necessity

6. True Leasing Co., Ltd. (TLS) (The Company directly holds 99.99%) Charoen Pokphand Group of Companies (CPG)

CPG is a major shareholder of the Company. The Company directly holds 99.99% in TLS’s equity interest. These companies are related through directorships.

Sale : - Vehicle rental and services

301,044 - The transactions arose in ordinary course of business at the rate of Baht 15,000 per unit per month. The maturity are normally in 3 years basis.

7. Asia Infonet Co., Ltd. (AI) (The Company indirectly holds 65.00%) Charoen Pokphand Group of Companies (CPG)

CPG is a major shareholder of the Company. The Company indirectly holds 65.00% in AI’s equity interest. These companies are related through directorships.

Purchase : - Office rental and related services

3,018 - The transactions arose in ordinary course of business at the rate of Baht 358,750.55 per month. The maturity are normally in the year and are allowed to be renewed.

8. True Digital Entertainment Co., Ltd. (TDE) (The Company directly and indirectly holds 99.99%) 8.1 Charoen Pokphand Group of Companies (CPG)

CPG is a major shareholder Purchase : of the Company. The - Office rental and Company directly holds related services 92.46% and indirectly holds 7.53% in TDE’s equity interest. These companies are related through directorships.

8.2 True Internet Data The Company indirectly Center Co., Ltd. (TIDC) holds 70.00% in TIDC’s equity interest and directly holds 92.46% and indirectly holds 7.53% in TDE’s equity interest. These companies are related through directorships.

Purchase: - Internet server rental

6,268 - The transactions arose in ordinary course of business.

2,281 - The transactions arose in ordinary course of business.

9. Asia Wireless Communication Co., Ltd. (AWC) (The Company indirectly holds 99.99%) 9.1 Charoen Pokphand Group of Companies (CPG)

CPG is a major shareholder of the Company. The Company indirectly holds 99.99% in AWC’s equity interest. These companies are related through directorships.

Purchase : - Other services - Telephone

1,710 - The transactions arose in ordinary course of business. 25,322 - The transactions arose in ordinary course of business.

9.2 NEC Corporation (Thailand Co., Ltd. (NEC)

The Company indirectly holds 9.62% in NEC’s equity interest and 99.99% in AWC’s equity interest.

Purchase : - Repair and maintenance network services

11,197 - The transactions arose in ordinary course of business.

10. True Internet Data Center Co., Ltd. (TIDC) (the Company indirectly holds 70.00%) NC True Co., Ltd. (NC TRUE)

The Company indirectly holds 40.00% in NC TRUE’s equity interest and 70.00% in TIDC’s equity interest. These companies are directorships, i.e. Mr. Noppadol Dej-Udom.

Sale : - Internet server rental and other services

3,074 - The transactions arose in ordinary course of business at the rate of Baht 54,000 per unit per month. The maturity are normally in 1 years basis.

11. True Lifestyle retail Co., Ltd. (TLR) (The Company indirectly holds 99.99%) Charoen Pokphand Group of Companies (CPG)

CPG is a major shareholder of the Company. The Company indirectly holds 99.99 TLR’s equity interest. These companies are related through directorships.

Purchase : - Purchase of goods

7,008 - The transactions arose in ordinary course of business.

12. True Visions Group of companies (True Visions) (The Company indirectly holds 91.79%) Charoen Pokphand Group of Companies (CPG)

CPG is a major shareholder of the Company. The Company indirectly holds 91.79% in True Visions’s equity interest.

Sale : - Activities sponsorship Purchase : - Other service

56,300 - The transactions arose in ordinary course of business that True Visions proposed to the third party. 11,028 - The transactions arose in ordinary course of business.

BETTER TOGETHER 115

Company Name

Relationship

Details of transactions

2007

(Baht’000)

Rationale and necessity

13. True Touch Co., Ltd. (TT) (The Company indirectly holds 99.99%) Charoen Pokphand Group of Companies (CPG)

CPG is a major shareholder Purchase : of the Company. The - Office rental and Company directly holds related services 99.99% in TT’s equity interest. These companies are related through directorships.

13,830 - The transactions arose in ordinary course of business.

14. Wire and Wireless Co., Ltd. (WW) (The Company directly holds 87.50%) Charoen Pokphand Group of Companies (CPG)

CPG is a major shareholder of the Company. The Company directly holds 87.50% in WW’s equity interest. These companies are related through directorships.

Purchase : - Other services

1,963 - The transactions arose in ordinary course of business.

15. True Money Co., Ltd. (TMN) (The Company directly and indirectly holds 99.99%) 15.1 Charoen Pokphand Group of Companies (CPG)

CPG is a major shareholder of the Company. The Company directly holds 49.00% and indirectly holds 51.00% in TMN’s equity interest. These companies are related through directorships.

Purchase : - Commission from cash 136,429 - The transactions arose in ordinary course of card business.

15.2 NC True Co., Ltd. (NC TRUE)

The Company directly holds Sale : 40.00% in NC TRUE’s equity - Collection agent fee interest and directly holds 49.00% and indirectly holds 51.00% in TMN’s equity interest. These companies are related through directorships, i.e. Mr. Suphachai Chearavanont

5,063 - The transactions arose in ordinary course of business that TMN proposed to the third party.

16. True Internet Gateway Co., Ltd. (TIG) (The Company directly holds 99.99%) 16.1 KSC Commercial The Company directly holds Sale : Internet Co., Ltd. (KSC) 99.99% in TIG’s equity interest - Internet gateway and indirectly holds 37.80% in transmission KSC’s equity interest. These service companies are related through directorships. 16.2 Charoen Pokphand Group of Companies (CPG)

CPG is a major shareholder of Purchase : the Company. The Company - Office rental and other directly holds 99.99% in TIG’s services equity interest. These companies are related through directorships.

11,506 - The transactions arose in ordinary course of business that TIG proposed to the third party.

1,262 - The transactions arose in course of business that TIG proposed to the third party.

17. True Public Communication Co., Ltd. (TPC) (The Company directly holds 99.94%) Charoen Pokphand Group of Companies (CPG)

CPG is a major shareholder of Purchase : the Company. The Company - Other service directly holds 99.94% in TPC’s equity interest. These companies are related through directorships

116 ANNUAL REPORT 2007

6,183 - The transactions arose in ordinary course of business.

ii) Outstanding balances arising from sales of goods and services: Movement of outstanding balances arising from sales of goods and services are as follows: Unit : Thousand Baht Joint ventures, associates and 31 December Increase 31 December related companies 2006 (Decrease) 2007 Asia Infonet Co., Ltd. 14,973 13,580 28,553 True Internet Data Center Co., Ltd. 827 5,549 6,376 KSC Commercial Internet Co., Ltd. 57,100 2,500 59,600 NC True Co., Ltd. 6,024 10,078 16,102 NEC Corporation (Thailand) Co., Ltd. 24 (4) 20 CP Group of companies 850,867 144,376 995,243 Total 929,815 176,079 1,105,894 iii) Outstanding balances arising from purchases of goods and services: Movement of outstanding balances arising from purchases of goods and services are as follows: Unit : Thousand Baht Joint ventures, associates and 31 December Increase 31 December related companies 2006 (Decrease) 2007 Asia Infonet Co., Ltd. 26,585 21,722 48,307 True Internet Data Center Co., Ltd. 5,205 4,573 9,778 KSC Commercial Internet Co., Ltd. 7,214 755 7,969 BeboydCg Company Limited. 3,210 3,210 NC True Co., Ltd. 1,045 2,352 3,397 CP Group of companies 50,653 18,393 69,046 NEC Corporation (Thailand) Co., Ltd. 3,622 (3,618) 4 Total 94,324 47,387 141,711 iv) Outstanding balances arising from loans to related parties Movement of outstanding balances arising from loans to related parties are as follows: Unit : Thousand Baht Related companies 31 December Increase 31 December 2006 (Decrease) 2007 KSC Commercial Internet Co., Ltd. 25,880 25,880 True Internet Data Center Co., Ltd. 12,000 (12,000) BeboydCg Company Limited. 3,000 3,000 Total 37,880 (9,000) 28,880 Remark *The Company indirectly holds 37.80% in KSCâ&#x20AC;&#x2122;s equity interest. v) Outstanding balances arising from loans from a related party Movement of outstanding balances arising from loans from a related party are as follows: Unit : Thousand Baht Related companies 31 December Increase 31 December 2006 (Decrease) 2007 Kreditanstalt fĂźr Wiederaufbau (KfW)

5,579,378

(981,603)

4,597,775

KfW is the only preference shareholder of the Company and holds 15.53% of issued and paid-up share capital. BETTER TOGETHER 117

The loan from Kreditanstalt für Wiederaufbau. The loans rank pari passu with other secured lenders and carry interest at LIBOR plus a fixed percentage per annum. The loans are secured against various categories of assets. The first repayment will be due in September 2006 and the final maturity date will be on 31st December 2011. The related interest expenses were Baht 365.29 million for the year ended 31st December 2007. vi) Commitments The Company has carried the commitment to support a certain subsidiary pertaining to loans agreements entered into by the subsidiary with its creditors. The financial supports are set as follows: 1. Regulatory sponsor support to governmental authorities arising out the mobile phone concession: where the subsidiary experience cash shortfalls for its normal operation due to regulatory cost, the sponsors shall provide financial support for the amount of the shortfall caused by the excess regulatory costs. 2. General cash deficiency sponsor support: where the cash flows of the subsidiary are insufficient for its normal operations or debt repayments pursuant to the terms of the financing documents with its lenders, the Company will provide financial support to the subsidiary in a total amount no exceeding Baht 7,000.00 million. Under the terms and conditions of the agreements, the Company and concerned parties must comply with certain conditions as stipulated in the agreements. The sponsor support funds must be injected into the subsidiary in the form as specified in the agreements. Measures and Procedures for Approving the Entering into of Connected Transactions The Company has measures and procedures for approving the entering into of connected transactions in compliance with the rules and Regulations of the Office of the Securities and Exchange Commission (“SEC”) and the Stock Exchange of Thailand (“SET”) i.e. related party transactions must be approved by the Independent Directors and processed according to established internal procedures for related party transactions, details of which have been stipulated by the Independent Directors. If any related party transaction is deemed to be a connected transaction, the said transaction must be approved by the Audit Committee, the Board of Directors and/or the Shareholders’ Meeting as the case may be, according to the regulations of the Stock Exchange of Thailand. Moreover, the Company must comply with the terms and conditions of the Shareholders’ Agreement executed with Kreditanstalt Für Wiederaufbau date 22nd December 1999 which specifies that the Company must disclose i f its major share holders or affiliates enter into any connected transactions Policy for Future Connected Transactions In addition, in order to strictly comply with the rules and regulations of the SEC and the SET, the Company has applied said rules and regulations in implementing internal guidelines for connected transaction by undertaking a comparative study of the connected transactions guidelines of various foreign institutions to enhance transparency and create parallel understanding with foreign analysts and investors. With regard to future connected transactions, the Company anticipated that there will be connected transactions in the ordinary course of business of the Company with its affiliates and that the Company shall proceed with such transactions in a transparent manner pursuant to the good corporate governance policy of the Company as well as all relevant regulations.

118 ANNUAL REPORT 2007

Audit fees 1. Audit fees The audit fees and related expenses occurred during the year 2007 was Baht 23.57 million. The Company and subsidiaries paid during the year amount of Baht 14.78 million to the appointed auditing firm. The remaining fees of Baht 8.79 million will be paid in the following year. 2. Other non-audit fees During the year 2007, the appointed auditing firm provided other non-audit services, i.e. agree-upon procedures, tax consulting service and other to the Company and subsidiaries. The fees were Baht 31.09 million of which Baht 30.50 million was paid during the year. The remaining of Baht 0.59 will be paid in the following year.

BETTER TOGETHER 119

Report of the Audit Committee for the Year 2007

The Audit Committee, comprised of Mr. Vitthya Vejjajiva, Dr. Kosol Petchsuwan and Mr. Joti Bhokavanij, was reappointed by the Board of Directors Meeting No. 2/2549 held on 23rd February 2006 to perform duties and discharge responsibilities under the charter for the Audit Committee. During the year 2007, the Audit Committee proceeded as follows: 1. Held 7 meetings in 2007 in order to discharge its functions as assigned by the Board of Directors. Management was invited to provide extra information in certain agenda items. The Audit Committee reported its activities to the Board of Directors on a quarterly basis; 2. Recommended the appointment of external auditor to the Company and its subsidiaries and recommended the external auditor’s remuneration to the Board; 3. Discussed with the external auditor the scope of their audits before they commenced, follow up their audits and considered their Management Letter; 4. Acknowledged the audit plan and external auditor’s findings and provided recommendations; 5. Reviewed the annual and quarterly financial reports of the Company and its subsidiaries to ensure correctness, reliability and adequacy of information disclosed reflecting good corporate governance; 6. Regularly reviewed the Company’s and its subsidiaries’ practices relating to connected transactions to ensure compliance with the regulation of the Stock Exchange of Thailand; 7. Reviewed internal audit and its relationship with the external auditors, including plans and performance; 8. Provided advice to Internal Audit Department; 9. Considered the internal audit plan under risk-based approach and the monthly, quarterly and annual results as well as submitted suggestions on actions to be taken by the management, and also on following up the progress of these actions; 10. Closely monitored the work progress of Internal Audit Department in order to enhance effectiveness of the internal audit function; 11. Ensured the improvement of internal controls system of the Company to enhance efficiency and effectiveness and ensure appropriate compliance with applicable regulatory requirements. True Group IT and Telecom Network security improvement Based on the performance of Internal Audit Function since 2005 over the Corporate Information System and Telecom Network control assessment and recommendations, corporate information security awareness has been continuously improved and many of security controls have been implemented to strengthen existing controls (e.g. established the corporate network security function, ISO-27001 standard implementation).

120 ANNUAL REPORT 2007

Corporate Revenue Assurance Following the recommendation of Internal Audit Department, Corporate Revenue Assurance Department was set up in December 2006 to carry out their duties and responsibilities according to the approved strategic plan of the Corporate Revenue Assurance. Group Internal Audit assisted Corporate Revenue Assurance in reviewing the adequacy and effectiveness of the revenue assurance process in the year 2007 and make recommendations to improve the internal control to ensure the end-to-end revenue assurance process to minimize revenue leakage and potential loss. The Audit Committee has independence in performing the duties as assigned. In this regard, the Audit Committee has received good cooperation from the management, met and discussed with the independent auditors to be informed on the auditorâ&#x20AC;&#x2122;s comments on the financial statements and internal controls system. The independent auditors, internal auditors, and management of the Company have not brought any matter to the attention of the Audit Committee that would indicate material weaknesses in the internal controls system or legal non-compliance.

signed by Mr. Vitthya Vejjajiva Chairman of the Audit Committee

BETTER TOGETHER 121

Report of the Compensation and Nominating Committee for the Year 2007

By virtue of the resolution of the Board of Directors of the Company passed at its meeting No. 8/2544 held on 16th November 2001, the Compensation and Nominating Committee (the “Committee”) was appointed to perform and discharge certain responsibilities. During the year 2007, the Committee carried out the following tasks: 1. held three meetings in order to discharge its functions as assigned by the Board of Directors; 2. considered and proposed recommendation to the Board of Directors regarding the election of Directors to replace the Directors retiring by rotation; 3. considered and proposed recommendation to the Board of Directors regarding the Directors’ remuneration; 4. considered the Employee Stock Option Plan for the Year 2007 (the “ESOP 2007 Project”) and proposed recommendation to the Board of Directors and the Shareholders Meetings for further consideration and approval respectively; 5. considered and approved the variable payout to the CEO and President for the Year 2006 (payout in 2007); and 6. considered and approved the Executives Variable Pay Plan for the Year 2007 (payout in 2008).

signed by Mr. Umroong Sanphasitvong Representative of the Compensation and Nominating Committee

122 ANNUAL REPORT 2007

Report of the Corporate Governance Committee for the Year 2007

By virtue of a resolution of the Board of Directors of the Company passed at its meeting No. 3/2549 held on 24th March 2006, the Corporate Governance Committee was appointed to perform duties and discharge responsibilities. During the year 2007, the Corporate Governance Committee proceeded as follows: 1. held two meetings in order to discharge its functions as assigned by the Board of Directors; 2. considered the Report on Corporate Governance Practice of the Company for disclosure in the Annual Report for the Year 2007 and proposed to the Board of Directors for consideration and approval; 3. reviewed criteria to screen the issues and directors nominees proposed by minority shareholders in advance for consideration to include in the Annual General Meeting of the Shareholders for the Year 2008 and proposed to the Board of Directors for consideration and approval; and 4. considered the results of self-assessment of the Board of Directors and proposed to the Board of Directors for acknowledgement.

signed by Mr. Narong Srisa-an Chairman of the Corporate Governance Committee

BETTER TOGETHER 123

Report of the Finance Committee for the Year 2007

By virtue of a resolution of the Board of Directors of True Corporation Public Company Limited (the â&#x20AC;&#x153;Companyâ&#x20AC;?) passed at its meeting No. 8/2544 held on 16th November 2001, the Finance Committee was appointed to perform and discharge certain responsibilities. During the Year 2007, the Finance Committee has carried out the following tasks: 1. held seven meetings in order to discharge its functions as assigned by the Board of Directors; 2. considered the 2007 financial targets and proposed recommendation to the Board of Directors for approval; 3. considered opening new bank accounts and proposed recommendation to the Board of Directors for approval; 4. considered the revision of authorized bank signatories with respect to certain bank accounts and proposed recommendation to the Board of Directors for approval; 5. considered various investment projects and proposed recommendation to the Board of Directors for approval; 6. considered the quarterly and annual financial results of the Company and its subsidiaries; 7. considered the refinancing status and plan of the Company and certain subsidiaries; 8. considered the fund raising alternatives for certain subsidiaries of the Company and proposed recommendation to the Board of Directors for further consideration; 9. considered the Annual Hedging Plan of the Year 2008 together with the Policy on the Use of Derivative Securities in Financial Transactions and proposed recommendation to the Board of Directors for approval; and 10. considered the preliminary overview of the 2008 financial target and proposed to the Board of Directors for preliminary information.

signed by Dr. Ajva Taulananda Chairman of the Finance Committee

124 ANNUAL REPORT 2007

Report of the Board of Directorsâ&#x20AC;&#x2122; Responsibilities for Financial Statements for the Year 2007

The Board of Directors is responsible for the financial statements of the Company and its subsidiaries. The aforementioned financial statements have been prepared in accordance with Generally Accepted Accounting Principles, using appropriate accounting policy consistently employed by the Company as well as applying careful judgment and best estimation. Important information is adequately disclosed in the notes to financial statements. The Board of Directors has provided and maintained an efficient internal control system to ensure that accounting records are accurate, complete and adequate to protect its assets. To accomplish this task, the Board of Directors has appointed an Audit Committee, which consists of Independent Directors responsible for the quality of financial statements and internal control system, whose comments on these issues are readily included in the Audit Committee Report in this Annual Report. The Board of Directors is of the opinion that the Companyâ&#x20AC;&#x2122;s overall internal control system is adequate and suitable and has rendered credibility and reliability to the financial statements of the Company and its subsidiaries for the year ended 31st December 2007.

signed by Mr. Dhanin Chearavanont Chairman of the Board

BETTER TOGETHER 125