Translation- Company PACE SET D&D Thailand

Transcription

1 No. PACE /01 Date 13 March 2015 Subject: Attention: Resolutions of the Board of Directors' Meeting and Schedule of 2015 Annual General Meeting of Shareholders President The Stock Exchange of Thailand Enclosures: 1. Information Memorandum regarding the Connected Transaction of Pace Development Corporation Public Company Limited (Enclosure 1) 2. Capital Increase Form (Form 53-4) (Enclosure 2) Pace Development Corporation Public Company Limited (the Company or PACE ) hereby discloses the resolutions made at the Board of Directors Meeting No. 1/2015 held on 27 February 2015 at 3.00 pm and the Board of Directors Meeting No. 3/2015 held on 13 March 2015 at am at No.87/2 CRC Tower, All Season Place 45th Fl., Unit 3, Wireless Road, Lumpini, Pathumwan, Bangkok, to the Stock Exchange of Thailand (the "SET") as follows: 1. Proposed the Shareholders Annual General Meeting to consider and approve the Company s Financial Statements for the financial year ended 31 December Approved the appointment of Deloitte Touche Tohmatsu Jaiyos Advisory Co., Ltd. as the independent financial advisor to provide opinions on the acquisition of shares of Dean & DeLuca (Thailand) Co., Ltd ("D&D Thailand") including the assignment of the rights to receive a repayment of outstanding loan and approve the execution of the shares sale and purchase agreement and any agreements in relation to the assignment of the rights to receive a repayment of outstanding loan (details of which are shown in Item 8). 3. Approved the extension of the allocation and payment period of the newly issued ordinary shares to specific persons under Private Placement Scheme (Private Placement) No.1 (as approved by the Extraordinary General Meeting of Shareholders No. 1/2015) from within 31 March 2015 to within 24 April Proposed the Shareholders Annual General Meeting to consider and appoint auditors and the auditing fee for the Company for the year From the selection of the auditors, the audit committee appointed Baker Tilly Audit and Advisory Services (Thailand) Ltd. as the Company's auditing firm for the year The following auditors are appointed to have the power to audit and express opinion on financial statements of the Company; and approve the auditing fee for the year 2015 of not more than Baht 2,030,000. 1) Mr. Apichart Sayasit, Certified Public Accountant (Thailand) No. 4229; and/or 2) Miss Wimolsri Jongudomsombut, Certified Public Accountant (Thailand) No Proposed the Shareholders Annual General Meeting to consider and approve the allocation of net profit of the year 2014 as statutory reserve for the Company's operational results of financial year ended 31 December 2014 and not to pay dividend. 6. Proposed the Shareholders Annual General Meeting to re-elect 1) Mr. Sorapoj Techakraisri 2) Mr. Chotipol Techakraisri and 3) Mr. Prasert Patradhilok who will retire by rotation to serve as the Company s directors for another term. 1

2 7. Proposed the Shareholders Annual General Meeting to consider and approve the directors remunerations for the year 2015 in the amount of not more than Baht 3,200,000 (Three Million and Two Hundred Thousand Baht). 8. Proposed the Shareholders Annual General Meeting to consider and approve the acquisition of shares of D&D Thailand including the assignment of the rights to receive a repayment of outstanding loan and approve the execution of the shares sale and purchase agreement and any agreements in relation to the assignment of the rights to receive a repayment of outstanding loan (collectively referred to as the "Acquisition of D&D Thailand"), details of which are shown in Enclosure Proposed the Shareholders Annual General Meeting to consider and approve the reduction of the registered capital of the Company from Baht 3,196,988,170 to Baht 2,596,988,170 by removing 600,000,000 authorized but unissued shares with a par value of Baht 1 per share. 10. Proposed the Shareholders Annual General Meeting to consider and approve amendment to clause 4 of the Memorandum of Association of the Company to be consistent with the reduction of registered capital of the Company. Clause 4. Registered capital: Baht 2,596,988,170 (two billion, five hundred ninety-six million, nine hundred eightyeight thousand, one hundred seventy baht) divided into 2,596,988,170 shares (two billion, five hundred ninety-six million, nine hundred eightyeight thousand, one hundred seventy shares) par value per share Baht 1 (one baht) consisting of ordinary shares 2,596,988,170 shares (two billion, five hundred ninety-six million, nine hundred eightyeight thousand, one hundred seventy shares) preference shares - share (-) 11. Proposed the Shareholders Annual General Meeting to consider and approve the increase of the registered capital of the Company in an amount of 664,690,027, from the existing registered capital of Baht 2,596,988,170 to Baht 3,261,678,197 by issuing the newly issued shares in an amount of 664,690,027 shares, with a par value of Baht 1 per share. 2

3 12. Proposed the Shareholders Annual General Meeting to consider and approve amendment to clause 4 of the Memorandum of Association of the Company to be consistent with the increase of registered capital of the Company. Clause 4. Registered capital: Baht 3,261,678,197 (three billion, two hundred sixty-one million, six hundred seventy-eight thousand, one hundred nighty-seven baht) divided into 3,261,678,197 shares (three billion, two hundred sixty-one million, six hundred seventy-eight thousand, one hundred nighty-seven shares) par value per share Baht 1 (one baht) consisting of ordinary shares 3,261,678,197 shares (three billion, two hundred sixty-one million, six hundred seventy-eight thousand, one hundred nighty-seven shares) preference shares - share (-) 13. Proposed the Shareholders Annual General Meeting to consider and approve the allocation of newly issued shares to specific persons under the Private Placement Scheme (Private Placement) as follows: 13.1 the allocation of not more than 21,293,801 newly issued ordinary shares of the Company at the par value of Baht 1 per share at the price of Baht 3.71 per share, totalling Baht 79,000, in order to offer and sell to Mr. Sorapoj Techakraisri as the consideration for the ordinary shares of D&D Thailand; and 13.2 the allocation of not more than 43,396,226 newly issued ordinary shares of the Company at the par value of Baht 1 per share at the price of Baht 3.71 per share, totalling Baht 160,999, in order to offer and sell to Mr. Sorapoj Techakraisri as the consideration for the assignment of the rights to receive a repayment of outstanding loan. With respect to the determination of the values or prices of shares of the Company at Baht 3.71 per share in 13.1 and 13.2, the prices will not be lower than the par value of the Company and not lower than 90 percent of the market price pursuant to the Notification of the Capital Market Supervisory Board No. TorChor. 28/2551 Re: Application for and Approval of Offer for Sale of Newly Issued Shares and Notification of the Office of the Securities and Exchange Commission No. SorChor. 39/2551 Re: Calculation of Offer Price of Securities and Determination of Market Price for Consideration of Offer for Sale of Newly Issued Shares with Discount. 3

4 Market price means the average closing price of the shares of the Company on the Stock Exchange of Thailand for 7 consecutive business days before the date that the Board of Directors proposes the offering of the newly issued shares for approval at the 2015 Annual General Meeting of Shareholders, being the period from 4 March 2015 to 12 March 2015, which is Baht 3.71 per share (information from SETSMART in of the Stock Exchange of Thailand). In this regard, the Company authorized the Board of Directors and/or the Chief Executive Officer and/or the persons authorized by the Board of Directors and/or the Chief Executive Officer to consider and determine other details relevant to the allocation of the newly issued ordinary shares, for example: (1) to determine terms and conditions and other details with respect to the Acquisition of D&D Thailand and the allocation of the newly issued ordinary shares; (2) to enter into negotiations and agreements, and execute documentation and agreements relevant to the Acquisition of D&D Thailand and the allocation of the newly issued ordinary shares; (3) to sign application forms for permission and evidence necessary for and relevant to the Acquisition of D&D Thailand and the allocation of the newly issued ordinary shares, as well as to contact and apply for any permission regarding such documentation and evidence with the government agencies or other relevant agencies and the listing of the newly issued ordinary shares of the Company on the Stock Exchange of Thailand, and to undertake any other action necessary for and relevant to the Acquisition of D&D Thailand and the allocation of the newly issued ordinary shares as he/she deems appropriate, whereby the undertaking shall be in compliance with the relevant laws and/or regulations. In this regard, the details of the allocation are set as out in the Capital Increase Report Form (F 53 4) (Enclosure 2). 14. Proposed the Shareholders Annual General Meeting to consider and approve the allocation of not exceeding 600,000,000 newly issued ordinary shares with the par value of Baht 1 to offer to the existing shareholders in proportion to their shareholding (Rights Offering) by General Mandate pursuant to Notification Of The Board Of Governors Of The Stock Exchange Of Thailand Re : Rules, Conditions And Procedures Governing The Disclosure Of Information In Respect Of Capital Increase Of Listed Companies. In this regard, the details of the allocation are set as out in the Capital Increase Report Form (F 53 4) (Enclosure 2). 15. Proposed the Shareholders Annual General Meeting to consider and approve the Company to issue and offer debentures within an amount not more than Baht 5,000,000,000 (Baht five billion) 16. Approved to schedule the date of the 2015 Annual General Meeting of Shareholders, to be held on 27 April 2015 at 2.00 pm at Great Room, 3 rd Floor, W Hotel, Bangkok and authorize the Chief Executive Officer and/or the persons authorized by the Chief Executive Officer to consider and change the agenda, the date, time and venue of the 2015 Annual General Meeting of Shareholders, as deemed appropriate by taking into account the benefits to and impact upon the Company. The meeting has the following agenda items: Agenda Item 1 Agenda Item 2 To consider and approve the Minutes of the Extraordinary Meeting of Shareholders No. 1/2015; To acknowledge the report of the Board of Directors in relation to the Company's operational result for the year

5 Agenda Item 3 Agenda Item 4 Translation- To consider and approve the Company s Financial Statements for the financial year ended 31 December 2014 To consider and approve the appointment of auditor and auditors' fees for the year 2015 Agenda Item 5 To consider and approve the allocation of net profit for the year 2014 as statutory reserve and no dividends payment Agenda Item 6 To consider and elect directors to replace those due to retire by rotation Agenda Item 7 To consider and approve directors' remunerations for the year 2015 Agenda Item 8 Agenda Item 9 Agenda Item 10 Agenda Item 11 Agenda Item 12 Agenda Item 13 Agenda Item 14 Agenda Item 15 Agenda Item 16 To consider and approve the acquisition of shares of D&D Thailand including the assignment of the rights to receive a repayment of outstanding loan and approve the execution of the shares sale and purchase agreement and any agreements in relation to the assignment of the rights to receive a repayment of outstanding loan; To consider and approve the reduction of the registered capital of the Company from Baht 3,196,988,170 to Baht 2,596,988,170 by removing 600,000,000 authorized but unissued shares with a par value of Baht 1 per share; To consider and approve the amendment Clause 4 of the Company s Memorandum of Association in order to be in line with the capital reduction; To consider and approve the increase of the registered capital of the Company in an amount of Baht 664,690,027, from the existing registered capital of Baht 2,596,988,170 to Baht 3,261,678,197 by issuing the newly issued ordinary shares in an amount of 664,690,027 shares, with a par value of Baht 1 per share; To consider and approve the amendment Clause 4 of the Company s Memorandum of Association in order to be in line with the capital increase; To consider and approve the allocation of the newly issued ordinary shares to specific person under Private Placement To consider and approve the allocation of the newly issued ordinary shares by General Mandate to the existing shareholders in proportion to their shareholding (Rights Offering); and To consider and approve the Company to issue and offer debentures within an amount not more than Baht 5,000,000,000 (Baht five billion) Other matters (if any) 17. Approved the date to determine the names of shareholders who are entitled to attend the 2015 Annual General Meeting of Shareholders (Record Date) to be scheduled on 30 March 2015, and the date to collect the names of shareholders pursuant to Section 225 of the Securities and Exchange Act B.E (1992) (including any amendment thereto) by means of the share register book closure to be scheduled on 31 March 2015, and authorize the Chief Executive Officer and/or the persons authorized 5

6 by the Chief Executive Officer to consider and change the date to determine the names of shareholders who are entitled to attend the 2015 Annual General Meeting of Shareholders (Record Date) and/or the date to collect the names of shareholders pursuant to Section 225 of the Securities and Exchange Act B.E (1992) (including any amendment thereto), as deemed appropriate by taking into account the benefits to and impact upon the Company. Please be informed accordingly Yours sincerely, (Mr. Sorapoj Techakraisri) Chief Executive Director 6

7 Enclosure 1 Information Memorandum regarding the Connected Transaction Pace Development Corporation Public Company Limited The Board of Directors Meeting No. 3/2015 (the Meeting ) of Pace Development Corporation Public Company Limited (the "Company") held on 13 March 2015 considered and resolved to propose to the meeting of shareholders to consider and approve the acquisition of % of ordinary shares in Dean and Deluca (Thailand) Company Limited ( D&D Thailand ) from Mr. Sorapoj Techakraisri, the assignment of the rights to receive a repayment of outstanding shareholder loan of D&D Thailand from Mr. Sorapoj Techakraisri for the total consideration of 240 million baht, and the execution of the share purchase agreement with the conditions precedent and shareholders loan assignment agreement with the conditions precedent with Mr. Sorapoj Techakraisri (collectively referred to as the "Transaction"). D&D Thailand is the exclusive licensee of Dean & DeLuca, Inc. to operate cafe, beverage and premium retailer under Dean & DeLuca brand exclusively in Thailand. The Transaction is a transaction entered into between the Company and Mr. Sorapoj Techakraisri, the director, management and the major shareholder of the Company, which is the Company s connected person. The transaction is considered as a connected transaction under the Notification of the Capital Market Supervisory Board Tor.Jor. 21/2551 Re: Connected Transaction Rules dated 31 August 2008 (as amended) and Notification of the Board of Governors of the Stock Exchange of Thailand Re: Disclosure of Information and Other Acts of Listed Companies concerning the Connected Transactions, 2003 dated 19 November 2003 (as amended). Based on the Company s consolidated financial statements as of 31 December 2014, the Company has negative net tangible assets; therefore, the Company is unable to calculate the transaction size based on net tangible assets method. In this regard, the total size of the transaction is greater than 20 million baht. To enter into the Transaction, the Company is required to submit the Information Memorandum regarding the Transaction to the Stock Exchange of Thailand ( SET ) and to convene a meeting of general shareholders to approve the Transaction. To be approved, the Transaction needs a vote of not less than three-fourths of the total number of votes of the shareholders attending and eligible to vote at the meeting, excluding the votes of shareholders having interests on this matter. The Company is required to arrange for an Independent Financial Advisor to provide the opinion on the reasonableness and the fairness of the Transaction price and terms of the Transaction to shareholders. The opinion shall be sent out with the invitation letter, stating the names and number of shares of the shareholders who have no right to vote, to the SET and shareholders. The Company is required to send the shareholder meeting invitation letter to shareholders and the SET at least 14 days prior to the meeting. Upon the calculation of the transaction size of the Transaction pursuant to the Notification of the Capital Market Supervisory Board No. TorJor. 20/2551 Re: Rules on Entering into Material Transactions Deemed as Acquisition or Disposal of Assets dated 31 August 2008; and the Notification of the Board of Governors of the Stock Exchange of Thailand Re: Disclosure of Information and Other Acts of Listed Companies Concerning the Acquisition or Disposal of Assets dated 29 October 2004 (the "Acquisition or Disposition of Assets Notification"), the size of the transaction calculated using the criteria of common share value, which is the highest value, equals 3.15% percent of total issued and fully paid-up 7

8 common shares of the Company (based on the consolidated financial statement as of 31 December 2014). The Transaction size is less than 15% of total issued and fully paid-up common shares of the Company. Therefore, it is considered as the acquisition of assets, Type 3. The Company is required to disclose information memorandum to the SET with information as prescribe in the Acquisition or Disposition of Assets Notification. In this respect, the entering into the acquisition of D&D Thailand is also considered the purchase or acceptance of the transfer of the business from other companies by the Company, under Section 107(2)(b) of the Public Limited Companies Act, B.E Therefore, the Company is required to hold a meeting of shareholders to consider and approve the acceptance of the transfer of business. In this respect, the resolution of the meeting of shareholders to approve the acceptance of the transfer of business requires an affirmative vote of not less than three-fourths of the total number of votes of the shareholders attending and eligible to vote at the meeting, excluding the vote of the shareholders having interests on this matter. As of the book closing date, 4 December 2014, the details of the shareholders having interests which have no right to vote are as follows: No. Shareholders names No. of shares % ownership 1 Mr. Sorapoj Techakraisri - The director, the management and the major shareholder of the Company 2 Mr. Sumate Techakraisri - The shareholder of the Company and father of Mr. Chotipol Techakraisri, Mr. Sorapoj Techakraisri and Mr. Chumpol Techakraisri 3 Mr. Chotipol Techakraisri - The director and the shareholder of the Company and elder brother of Mr. Sorapoj Techakraisri and Mr. Chumpol Techakraisri 4 Mr. Chumpol Techakraisri - The director and the shareholder of the Company and younger brother of Mr. Chotipol Techakraisri and Mr. Sorapoj Techakraisri 5 Miss Saijai Snidvongs Na Ayudhya - The shareholder of the Company and wife of Mr. Chotipol Techakraisri 1,105,312, ,000, ,000, ,000, , In this regard, the details of the Transaction are set out as follows: 8

9 1. Date, month, year to enter into the transaction On 13 March 2015, the Meeting of the Company considered and resolved to propose to the meeting of shareholders in the 2015 Annual General Shareholders Meeting which will be held on the 27 April 2015 to consider and approve the Transaction. In this respect, the Transaction will be completed when the conditions precedent as stipulated in the relevant agreements are fulfilled. Upon the completion of the Transaction, the Company will dispose % of ordinary shares in D&D Thailand to Pace Food Retail Company Limited ( PFR ) and PFR will issue ordinary shares to be allocated to the Company as the consideration of the transfer of shares in D&D Thailand to PFR (payment in kind). In this respect, the Transaction will be completed when the conditions precedent as stipulated in the relevant agreements are fulfilled. Ultimately, the Company will be benefit from a clear group shareholding structure and will indirectly hold shares in D&D Thailand through shareholding in PFR. PFR is the Company s wholly-owned subsidiary and also the investment vehicle for food and beverage business. The restructure will enhance the efficiency of the Company from strategic perspective as this will allow PFR to directly hold and operate entire retail business of the Company as the Company s flagship in food, beverage, and retail business. The attendance of the directors present at the Meeting were totaling 9 persons, thus constitution a quorum whereby 3 directors, Mr. Sorapoj Techakraisri, Mr. Chotipol Techakraisri and Mr. Chumpol Techakraisri, who were connected persons of the Company did not attend the Meeting and had no right to vote on this Transaction. 2. Name of the connected persons and the relationship Buyer: Seller: Pace Development Corporation Public Company Limited Mr. Sorapoj Techakraisri The relationship with the Company Mr. Sorapoj Techakraisri, who is the major shareholder, director and management of the Company, is considered a connected person of the Company. Therefore, Mr. Sorapoj Techakraisri is considered to have interest in the Transaction and not entitled to vote for the Transaction at the meeting of shareholders. In addition, the Company and D&D Thailand have common directors, i.e. Mr. Sorapoj Techakraisri and Mr. Chotipol Techakraisri. Hence, both directors are considered connected persons and not entitled to vote for the Transaction at the Board of Directors meeting. 3. General Information of Acquired Assets The Company will acquire % of ordinary shares in D&D Thailand and will be assigned the rights to receive a repayment of outstanding shareholders loan to D&D Thailand amounting to 161 million baht from Mr. Sorapoj Techakraisri. D&D Thailand is a company incorporated in Thailand since 25 August As of 13 March 2015, D&D Thailand has 100 million baht of registered and fully paid-up share capital, consisting of 1,000,000 ordinary shares at par value of 100 baht per share. 9

10 3.1 General Information of D&D Thailand Company Name Type of Business Office Address Company Registration Number Company Registration Date 25 August 2008 Dean and Deluca (Thailand) Company Limited Cafe, beverage and premium retailer business 723 Teo Hong Silom Tower, 5th Floor, Silom Road, Silom, Bangrak, Bangkok Business Description of D&D Thailand D&D Thailand is an exclusive licensee of Dean & DeLuca, Inc., to operate cafe, beverage and premium retailer under Dean & DeLuca brand exclusively in Thailand. D&D Thailand has the exclusive right to provide sub-license in Thailand and also the exclusive rights to distribute Dean & DeLuca product in hotels in agreed territory such as Thailand, Australia, China, Malaysia and Macau (Hospitality Sale Business). As of 13 March 2015, D&D Thailand has 4 branches (1) MahaNakhon (2) Park Venture (3) Sathorn Square and (4) Central Embassy. Dean & DeLuca, Inc. ( D&D ) is the Company s subsidiary which the Company acquired all of its shares from the existing shareholders on 4 December Dean & DeLuca, Inc. was incorporated in Delaware, USA as a multi-channel retailer of premium gourmet and delicatessen under Dean & DeLuca brand. Currently, the retail operations of D&D are under 11 branches comprised of 5 cafes in selected markets, 6 specialty markets throughout the United States. For international business operations, D&D adopt the licensing structure which provides the licensees with rights to use the Dean & DeLuca brand in the specific territory to operate as a multichannel retailer to expand. D&D has grown to have 32 international outlets in Japan, Singapore, Korea, Thailand, the Middle East countries, and Philippines. D&D also has the business-tobusiness operation, which comprised of sales through selected premium retailers and sales to corporate customers with a majority being luxury hotels and airline operators including e- commerce business. List of Directors of D&D Thailand As of 13 March 2015, D&D Thailand has 3 directors as follows: No. Director Names 1 Mr. Sorapoj Techakraisri 2 Mr. Sumate Techakraisri 3 Mr. Chotipol Techakraisri 10

11 List of Shareholders of D&D Thailand Translation- As of 13 March 2015, Mr. Sorapoj Techakraisri holds ordinary shares in D&D Thailand of approximately %. Summary of the Statement of Financial Positions of D&D Thailand (Million baht) Statement of Financial Positions 2014* 2013** 2012** Cash Account Receivable Inventory Property Plan and Equipment Other Assets Total Assets Short-term Loan Trade Payable Long-term Loan Other Liabilities Total Liabilities Registered and Paid-up Capital Retained Earnings/(Losses) (240.17) (141.44) (86.43) Total Shareholder Equity (140.17) (135.69) (80.67) Remarks: * Unaudited draft financial statements of D&D Thailand ** Audited financial statements of D&D Thailand Summary of Income Statement of D&D Thailand (Million baht) Income Statements 2014* 2013** 2012** Revenue Gross Profit Operating Profit/(Losses) before Interest (96.87) (54.08) (49.96) Interest Expense Net Profit/(Loss) (98.73) (55.01) (50.97) Remarks: * Unaudited draft financial statements of D&D Thailand ** Audited financial statements of D&D Thailand 11

12 3.2 General Information of Outstanding Shareholders Loan to D&D Thailand As of December 31, 2014, D&D Thailand issued promissory notes to Mr. Sorapoj Techakraisri amounting to 161 million baht. Such promissory notes carry no interest and no specific repayment date or due at call. 4. Total Value of Consideration and Payment, Basis Used to Determine the Consideration Value, Value of Assets Acquired and Sources of Fund 4.1 Total Value of Consideration Total Value of Consideration Basis Used to Determine the Consideration Value 4.2 Payment Method Value of Assets Acquired and Sources of Fund : Total value of 240 Million baht, comprising of: 1) Value of all ordinary shares in D&D Thailand of 79 million baht; and 2) The rights to receive a repayment of outstanding shareholders loan to D&D Thailand of 161 million baht : The consideration value was based on the negotiation between the Buyer and the Seller by calculating the enterprise value of D&D Thailand (inclusive of outstanding loan value and ordinary shares value) based on the discounted cash flow valuation method ( DCF Valuation ) as main valuation method. The key assumptions for the DCF Valuation are based on the existing operation of D&D Thailand s four stores at MahaNakhon, Park Venture, Sathorn Square, and Central Embassy together with the new store at EmQuartier in 2015 and growth potential from D&D Thailand s new business business-to-business focusing on Hospitality Business in which D&D Thailand has an exclusive rights in Thailand, Australia, China, Malaysia and Macau : 1) The Company will issue 21,293,801 newly issued ordinary shares (Par value of 1 baht per share) at an offer price of 3.71 baht per share amounting to approximately 79 million baht and offer to Mr. Sorapoj Techakraisri as consideration for ordinary shares of D&D Thailand (payment in kind), and; 2) The Company will issue 43,396,226 newly issued ordinary shares (Par value of 1 baht per share) at an offer price of 3.71 baht per share amounting to approximately 161 million baht and offer to Mr. Sorapoj Techakraisri as consideration for the assignment of rights to receive a repayment of 161 million baht outstanding shareholders loan to D&D Thailand (payment in kind). 12

13 Such offer price of the Company s shares was calculated by referencing with 7-day volume-weighted average price of the Company shares before the Board of Directors meeting on 13 March 2015 which is the capital increase and allocation approval date. The Company will complete the offering of the newly issued ordinary shares within 30 June The Company will file an application to the SEC for approval of the newly issued ordinary shares issued by the Company as consideration for the Transaction as additional listed securities. 5. Expected Benefits for the Company The Company expects to gain the following benefits from the Transaction: 1) Enhance the Company s operational flexibility, as after the Company acquired D&D on 4 December 2014, the Company and D&D Thailand, having common shareholders and directors, become related parties. Thus, many future transactions will be subject to related regulation on connected transactions; and 2) Opportunity to capture full growth potential as being an operator of Thailand s Dean & DeLuca business and Hospitality Sales Business in Australia, China, Malaysia, Vietnam and Macau, this will provide more benefit to the Company than receiving only royalty fee as franchisor to D&D Thailand; while there is no significant additional risk to the Company considering the fact that the Company also operates its business in Thailand with retail business expertise of D&D management team. The Transaction will have no impact to the Company in terms of liquidity considering the payment will be made by newly issued shares of the Company instead of cash (payment in kind). 6. Conditions of the Entering into the Transaction The conditions precedent of the Transaction are summarized as follows: a) Obtaining the approval of the board of directors meeting and meeting of shareholders with respect to the Transaction, the capital increase and the allocation of the newly issued ordinary shares of the Company; and b) Obtaining the consent from D&D, a subsidiary of the Company, as a licensor granting the rights to D&D Thailand to operate cafe, beverage and premium retailer under Dean & DeLuca brand exclusively in Thailand. 7. Characteristics and Scope of Interest of the Connected Persons Mr. Sorapoj Techakrasri is the Company s major shareholder, director and management and also D&D Thailand s major shareholder and director. In this regard, Mr. Sorapoj Techakraisri is deemed a connected person who has no right to vote for an approval of the Transaction at the Board of Directors meeting and the meeting of shareholders. The Company and D&D Thailand have common directors i.e. Mr. Sorapoj Techakrasri and Mr. Chotipol Techakraisri. As such, the aforementioned directors have no right to vote for an approval of the Transaction at the Board of Directors meeting and the meeting of shareholders. 13

14 Mr. Chumpol Techakraisri who is the Company s director and shareholder as well as Mr.Sorapoj Techakraisri s younger brother. Thus, Mr. Chumpol is deemed a connected person who has no right to vote at the Board of Director Meeting and the meeting of shareholders. Mr. Sumate Techakraisri who is the shareholder of the Company and D&D Thailand as well as D&D Thailand s director and father of Mr. Chotipol Techakraisri, Mr. Sorapoj Techakraisri and Mr. Chumpol Techakraisri. Thus, Mr. Sumate is deemed a connected person who has no right to vote at the meeting of shareholders. Miss Saijai Snidvongs Na Ayudhya who is the Company s shareholder and wife of Mr. Chotipol Techakraisri. Thus, Miss Saijai Snidvongs Na Ayudhya is deemed a connected person who has no right to vote at the meeting of shareholders. 8. Directors who have interests / Directors who are connected persons The attendance of the directors present at the Meeting were totaling 9 persons, thus constitution a quorum where by 3 directors, Mr. Sorapoj Techakraisri, Mr. Chotipol Techakraisri and Mr. Chumpol Techakraisri, who were connected person of the Company did not attend the Meeting and had no right to vote on this Transaction. 9. Opinion of the Board of Directors on the Connected Transaction The Board of Directors is of the opinion that the Transaction is reasonable as D&D Thailand is the exclusive licensee for the operation of café, beverage and premium retailers business in Thailand under Dean & DeLuca brand since 2008; therefore, after the Company acquired D&D on 4 December 2014, the Company s operation in Thailand will be less flexible as D&D Thailand and the Company have common shareholders and directors. In additions, being an operator of Thailand s Dean & DeLuca business and Hospitality Sales Business in Australia, China, Malaysia, Vietnam and Macau will provide more benefit to the Company than receiving only royalty fee as franchisor to D&D Thailand. The Board of Directors is of the opinion that the consideration and conditions of the Transaction are on a fair basis and for the best interest of the Company as the price negotiation for D&D Thailand (enterprise value inclusive of ordinary shares of D&D Thailand and outstanding loan in aggregate) was based on the discounted cash flow method which considered the ability to generate future cash flow of D&D Thailand. Moreover, the Company can maintain cash flow for future expansion as the Company will issue new ordinary shares as consideration for total shares of D&D Thailand. 10. Opinion of the Company s Audit Committee that are different from the Opinion of the Board of Directors No member of the Audit Committee has a different opinion from that of the Board of Directors. 11. Shareholders Meeting: Invitation to the Shareholders The Company will submit the invitation to the 2015 Annual General Shareholders Meeting, which will be held on 27 April 2015, as well as the opinion of the independent financial advisor to the SEC/SET at least 5 business days before sending the same to the shareholders and no fewer than 14 days before the meeting date. 12. The purpose of the Information Memorandum This Information Memorandum is made only for the purpose of providing information and not for the purpose of inviting or offering for acquiring or subscribing for securities. 14

15 (F 53-4) Enclosure 2 Capital Increase Report Form (Capital Reduction, Capital Increase and Allocation of Newly Issued Shares) Pace Development Corporation Public Company Limited 13 March 2015 We, Pace Development Corporation Public Company Limited (the Company ), with its principal office located at No. 87/2 CRC Tower, All Seasons Place 45th Fl., Unit 3, Wireless Road, Lumpini, Pathumwan, Bangkok, hereby report the resolutions of the Board of Directors Meeting No. 3/2015 held on 13 March 2015 relating to the capital decrease, capital increase and the allocation of the newly issued shares as follows: 1. Capital Reduction The Board of Directors Meeting passed a resolution approving the reduction of the Company s registered capital from Baht 3,196,988,170 to Baht 2,596,988,170 by removing 600,000,000 authorized but unissued shares with a par value of Baht 1 per share. The 600,000,000 authorized but unissued shares were reserved for the allocation to the existing shareholders of the Company in proportion to their shareholding (Right Offering) as a General Mandate, which the Company could not complete the allocation within the 2015 Annual General Meeting of Shareholders. 2. Capital increase The Board of Directors Meeting passed a resolution approving the increase of the Company s registered capital in an amount of Baht 664,690,027, from the existing registered capital of Baht 2,596,988,170 to Baht 3,261,678,197 by issuing 664,690,027 newly issued ordinary shares, with a par value of Baht 1 per share. Type of Capital Increase Type of Number of Par Value Total Share Shares (Baht/share) (Baht) Specifying the purpose of Ordinary 64,690, ,690,027 utilizing the proceeds General Mandate Ordinary 600,000, ,000, Allocation of the newly issued shares The Board of Directors' Meeting passed a resolution approving the allocation of not exceeding 664,690,027 ordinary shares with the par value of Baht 1.00 per share, totaling 664,690,027 shares, the details of which are as follows: 15

16 3.1.1 Specifying the purpose of utilizing the proceeds Allocated to Number of Ratio Sales Price Date/time of Remark Shares (old : (Baht/ subscription new) share) and share payment Specific Person under Private Placement (Mr.Sorapoj Techakraisri) 64,690, Within 30 June 2015 Please see remark General Mandate Allocated to Type of Number of Percentage per Remark Share Shares paid-up capital* Existing Ordinary Not exceeding Approximately - shareholders 600,000, % * Percentage per paid-up capital is equivalent to Baht 2,054,265,670 as at 13 November 2015, the date on which the Board of Directors passed a resolution approving the capital increase by means of a General Mandate. Remarks: 1. The Sales Price in will not be lower than the par value of the Company and not lower than 90 percent of the market price pursuant to the Notification of the Capital Market Supervisory Board No. TorChor. 28/2551 Re: Application for and Approval of Offer for Sale of Newly Issued Shares and Notification of the Office of the Securities and Exchange Commission No. SorChor. 39/2551 Re: Calculation of Offer Price of Securities and Determination of Market Price for Consideration of Offer for Sale of Newly Issued Shares with Discount. 3.2 Action to be taken by the Company when there are fractions of shares In the case that there are fractions of shares, such fractions shall be rounded down. 3.3 Outstanding share from the allocation -None- 4. Schedule for a shareholders meeting to seek approval for the capital reduction, capital increase and the allocation of the newly issued shares The Board of Directors' Meeting passed a resolution approving to schedule the 2015 Annual General Meeting of Shareholders to be held on 27 April 2015 at 2.00 pm, at Great Room, 3rd Floor, W Hotel, Bangkok. In this regard, the Company scheduled the date to determine the names of the shareholders entitled to attend the 2015 Annual General Meeting of Shareholders (Record Date) on 30 March 2015, and the date to collect the names of the shareholders pursuant to Section 225 of the Securities and Exchange Act B.E (1992) (including any amendment thereto) by means of the share register book closure, on 31 March

17 5. Application to the relevant government agency for approval of the capital increase/allocation of the newly issued shares and conditions thereto (if any) 5.1 The Ministry of Commerce: To register the reduction and increase in registered capital and changes to paid-up capital, including the amendment of the Company s Memorandum of Association. 5.2 The Stock Exchange of Thailand: To request approval to accept the registration of the newly issued ordinary shares as the listed securities on the Stock Exchange of Thailand. 6. Objectives of the capital increase and plans for utilizing the proceeds The proceeds received from the increase of capital of the Company by specifying the purpose of utilizing the proceeds will be used as the consideration to Mr. Sorapoj Techakraisri for the Company's acquisition of ordinary shares in Dean & DeLuca (Thailand) Co., Ltd ("D&D Thailand") and acceptance of the assignment of the rights to receive a repayment of outstanding loan. 7. Benefits which the Company will receive from the capital increase and allocation of the newly issued shares The increase of capital of the Company by specifying the purpose of utilizing the proceeds under Private Placement Scheme as the consideration to Mr. Sorapoj Techakraisri for the Company's acquisition of ordinary shares in D&D Thailand and acceptance of the assignment of the rights to receive a repayment of outstanding loan, as mentioned above, will result in benefits for the Company in several aspects, including the flow of the Company's operation. Subsequent to the acquisition of Dean & DeLuca Inc. on 4 December 2014, D&D Thailand and Dean & DeLuca Inc. have become connected persons as Dean & DeLuca Inc. is a subsidiary company of the Company and has joint shareholders and directors with D&D Thailand. Therefore, any undertaking or transactions to take place in the future would be considered under the rules on connected transaction which may increase the operating procedures. In addition, the capital increase for the allocation under the Private Placement scheme, instead of cash payment, as the consideration for the Company's acquisition of ordinary shares in D&D Thailand and acceptance of the assignment of the rights to receive a repayment of outstanding loan, has fully promoted the Company's benefits apart from obtaining the royalties from the opportunity of D&D Thailand's business growth, including the Dean & DeLuca shops in Thailand and the business in form of B2B for hotel business in Australia, China, Malaysia, Vietnam, and Macao. The Transaction will have no impact to the Company in terms of liquidity considering the payment will be made by newly issued shares of the Company instead of cash (payment in kind). 8. Benefits which the shareholders will receive from the capital increase/allocation of the newly issued shares 8.1 Dividend policy The Company has a policy of paying a dividend of no less than 40% of the Company s net profit each year on a consolidated basis, after deducting income tax, the legal reserve, and other reserves. The payment of dividends will, nonetheless, depend on investment plans and other necessity and appropriateness in the future. 8.2 Subscribers of the newly issued shares shall be entitled to dividends from the operating results from the date on which such subscribers names are registered as shareholders of the Company. 17

18 8.3 Other Translation- -None- 9. Other supporting details necessary for shareholders to approve the capital increase/ the allotment of newly issued ordinary shares Dilution effect on the shareholding proportion after the capital increase in accordance with is the control dilution of existing shareholders for approximately 3.05% when compared to shareholding before the capital increase. 10. Schedule of action where the Board of Directors of the Company passes a resolution approving the capital increase or the allocation of the newly issued shares No. Procedures Date / Month / Year 1 Board of Directors Meeting No. 3/ March Record Date for the 2015 Annual General Meeting of Shareholders 3 The date to collect the names of the shareholders pursuant to Section 225 of the Securities and Exchange Act B.E (1992) (including any amendment thereto) by means of the share register book closure 30 March March The 2015 Annual General Meeting of Shareholders 27 April Registration of capital increase with the Ministry of Commerce Within 14 days from the date on which approval is granted by the meeting of the shareholders The Company hereby certifies that the information contained in this report is true and complete in all respects. Please be informed accordingly. Sincerely yours, Pace Development Corporation Public Company Limited Signed (Mr. Sorapoj Techakraisri) Chief Executive Officer 18