[Translation] Ref. PDI.B.02109/98 8 October 1998 To :President The Stock Exchange of Thailand Re. : Announcement on allotment and offering of new ordinary shares Referring to our letter, ref.PDI.B.02.108/98 of 7 October 1998, enclosed is an announcement on allotment and offering of new ordinary shares for a private placement of Padaeng Industry Public Company Limited for the SET's information. Yours truly, - Signature - (Arsa Sarasin) Chairman and Executive Chairman Board Secretary Division Human Resources & Corporate Administration Department [Translation] Padaeng Industry Public Company Limited (PDI) Announcement of Capital Increase On 7 October 1998 PDI's board of directors meeting No. 6/1998 held on 29 September 1998 from 17.00 hrs. to 19.20 hrs. and continued on 6 October 1998 from 19.10 hrs. to 19.50 hrs. passed a resolution in respect of share allotment. The details are as follows : 1.Capital increase : The extraordinary shareholders' meeting No. 1/1996 on 12 June 1996 passed a resolution on allotment of 70 million new ordinary shares and any remaining shares from an offering to the existing share-holders (52 million shares) in 1996, to an investors(s) who is qualified or is in the 17 categories as mentioned in the announcement of the Securities and Exchange Commission (SEC). Subsequently, the 1998 ordinary shareholds'smeeting on 27 April 1998 has authorized the Executive Chairman or the President to determine share offering prices, dates,times,terms,methods and conditions for the above-referred private placement. 1.1 Registered capital : From : Bt1,443,695,580 To : Bt 2,260,000,000 1.2 Number of new common shares issued : 81,630,442 shares - Par value per share : Bt10 (Ten baht only) - Total capital increase : Bt 816,304,420 1.3 Number of new preferred shares issued : - shares - Par value per share : Bt - - Total capital increase : Bt - million 2. Allotment of new shares : 2.1 To existing shareholders : - Number of shares : - shares - Ratio (old:new) : - - Sale price per share : Bt - - The share register will be closed for share transfers in order to determine the right to subscribe new shares from 12.00 p.m. on - (day) until - (day) - Subscription and payment period : - . . . / 2 2 2.2 To the general public : - Number of shares : - shares - Sale price per share : Bt - - Subscription and payment period : - 2.3 To specific persons : Name Number of shares 1. Western Metals International Pty Ltd. 81,630,442 - Sale price per share : Bt14 (Fourteen baht only) - Subscription and payment period : First payment for 6,530,435 shares to be made by 9 October 1999 Second payment for 13,060,870 shares to be made by 28 February 1999 Third payment for 13,060,870 shares to be made by 31 March 1999 Fourth payment for 48,978,267 shares to be made by 31 July 1999 2.4 For supporting the conversion of - - Number of shares : - - Ratio : - For support in exercising the right of : - - Number of shares : - - Ratio : - The company's plan in case there is a fraction of shares remaining : The Executive Chairman or the President is authorized to consider offering any shares remained from the above-referred private placement to other new investor(s) who is qualified or is in the 17 categories in an announcement of the SEC as well as to determine share offering prices,dates,times, terms, methods and conditions as deemed appropriate. 3. Schedule for shareholders meeting : The share subscriber (Western Metals International Pty Ltd.) has obtained a waiver from the requirement to make a tender offer from the office of the SEC for holding the Company's shares up to 49% of the paid-up capital. And the shareholders' approval shall not be required. 4. Approval by relevant governmental agency and conditions (if any) : Although approval of any government agencies is not required, the Company will proceed with registration of the paid- up capital with the Ministry of Commerce upon each payment for the share subscription. 5. Objectives and plans for utilizing proceeds received from the capital increase : 5.1 Funds received from each payment for the share subscription will be totally repaid for the short- and long-term debt-outstandings in accordance with the Override Agreement signed with 9 creditors. . . . / 3 3 5.2 Any remaining fund will be used for the Company's working capital. 6. Expected benefits the company will receive : With lessening principal and interest burden, the creditors have greater confidence in the Company's financial position and have agreed to extend the repayment period for total debt outstandings. 7. Benefits the shareholders will receive : 7.1 Dividend policy : During the validity of the Override Agreement, if the total debt outstandings are less than 50% of the amount as of the date of signing the said agreement , dividends of not exceeding 25% of annual net income can be declared. In normal circumstances, 50% of net profit after tax, unless there is need for investment,can be declared. 7.2 Subscriber(s) to new shares issued will be entitled to receive dividends from the company's business operations starting from 1998. 7.3 Other benefits : - 8.Other details necessary for shareholders to approve the capital increase/share allotment : - 9.Schedule for the share subscription payment : 9 October 1998 -First payment for the share subscription 22 October 1998 -Registration of paid-up capital (after the first payment) with the Ministry of Commerce Within 28 February 1999 -Second payment for the share subscription Within 14 March 1999 -Registration of paid-up capital (after the second payment) with the Ministry of Commerce Within 31 March 1999 -Third payment for the share subscription Within 14 April 1999 -Registration of paid-up capital (after the third payment) with the Ministry of Commerce Within 31 July 1999 -Fourth payment for the share subscription Within 14 August 1999 -Registration of paid-up capital (after the fourth payment) with the Ministry of Commerce The Company certifies that the particulars and information indicated in this report are true and accurate. Arsa Sarasin Signature : ___________________________ Authorized director (Arsa Sarasin) Position : Executive Chairman (With Company's seal affixed)