Corporate Governance

The Company shall treat all shareholders, including those with management positions, non-executive shareholders, foreign shareholders and minority shareholders in an equal way as follows:

The Company pays attention to rights of each stakeholder group and has established a policy for each group as follows:

Shareholders : The Company aims to conduct the business using its best knowledge and management skills, with honesty and fairness to majority and minority shareholders in the best interests of all shareholders and disclose the information completely and accurately.

Staff : The Company will pay reasonable remunerations to all staff, provide safe working environment for life and property, seriously and continuously develop the staff’s potentials, strictly comply with all laws and regulations in conjunction with the staff, avoid unfair practice which could affect staff’s career, and treat all staff with respect to honor them humanity.

Customers : The Company aims to produce goods and provide services in good quality and standard with reasonable price, always and strictly maintain customer’s confidence and search for more opportunity to continuously increase customer’s benefits and strictly follows the terms and conditions that the Company provides to the customers.

Suppliers and Creditors : The Company will not conduct its business with suppliers and creditors in bad faith. The company will strictly perform all agreements between the Company and creditors whether the repayment, reimbursement, care of warrantee assets and any other agreements given to the creditors for mutual benefit.

Trade Competitors : The Company will follow the best practices of competition, avoid using dishonest and improper methods for acquisition of the competitor’s secret and avoid making baseless claims to destroy the competitor’s reputation.

Public : The Company will do nothing which will have adverse affect on the public, natural resources and the environment. The Company will seek an opportunity to support social creative activity, simultaneously and seriously educate staff on social responsibility including strictly follow and monitor staff practice as required by laws or regulations issued by the relevant authority.

The Company intends to disclose information accurately, transparently, timely and in compliance with the standards and criteria set by the Stock Exchange of Thailand to ensure that each person receives information equally. The afore-mentioned includes financial and general information and other information which affect the share price and the decision making process of the investors and stakeholders. The Company posts the information on the Stock Exchange of Thailand’s website and www.halcyon.co.th

The Board of Directors is aware of the responsibility to have accurate, actual, complete and reasonable financial statements. The consolidated financial statements of the Company were made in compliance with the generally accepted accounting principles. The appropriate accounting policies have been consistently adopted. The accountancy information recording is complete in order to maintain the integrity and aware of weaknesses so that the Company can consistently prevent corruption or material crisis conducts including adequate disclosure of important information in the notes to the financial statements. Moreover, the Board of Directors has appointed Audit Committee to examine financial reports, connected transactions and internal control system and the result of Audit Committee audits must be reported to each Board of Directors’ meeting. The reports of the Board of Director, the Audit Committee and the Company’s external auditor are disclosed in the Company’s Annual Report. Currently, the Company does not intend to establish the investment relation department, but assigns Mr. Pete Rimchala, the Managing Director, to coordinate with shareholders, analyst and others.

(1) Structure of the Board of Directors

The Company’s Board of Directors comprises of ones who have knowledge, ability and experiences in business operations beneficial to the Company. The Board of Directors, appointed by the shareholders’ meeting, consists of 7 directors which include 3 independent directors; of which 1 of them was appointed as the Chairman of the Board of Directors and the Chairman of the Audit Committee whereas the other 2 were appointed as the Audit Committee. One of the Audit Committee has accounting background and is able to verify the credibility of the financial statements. In addition, one-third of the Board of Directors, or at least 3 directors, will be independent directors, who act as representatives of the minority shareholders in examining and balancing the Company's operation for correct and fair operation and for the best interest of shareholders.

The Chairman of the Board of Directors will not be the same person as the Chairman of the Executive Board and the Managing Director in order to create a balanced and reviewed management. In addition, the Company has clearly established the scope of authorities, duties and responsibilities of the directors, Executive Board and the Managing Director, so that the Executive Board and the managing director will not have unlimited authorities regarding management and credit line approval.

(2) Subcommittees

The subcommittees appointed by The Board of Directors to assist in monitoring the business of the Company are:

However, in the future, the Company may establish subcommittees to assist the Board of Directors on the assigned business of the Company.

(3) Scope of Duties and Responsibilities of the Directors

The Board of Directors is responsible for establishing policies, visions, strategies, missions, business plans and the Company’s budget including monitoring the management for effective and successful performance of the policies provided under the law, objectives, Articles of Association and resolutions of the shareholders’ meeting. The Board of Directors has established:

Corporate Governance Policy
The Board of Directors has established, in written, the policy of corporate governance and reviewed the policy and its implementation at least annually

Code of Conduct
The Company has established the Code of Conduct as a guideline to the Board of Directors, Audit Committee and every staff, which mainly compresses the principles of non-disclosure of the Company’s secret, honesty and compliance with the laws, respect for the right of each other and protection of the Company's internal resources and the environment. Focusing on the Code of Conduct will encourage all levels to work with honesty and support efficient internal control which will create confidence in the capital market and among the investors.

Conflicts of Interest Policy
The Company has established the policy of conflicts of interest based on the principles that all staff must work in the best interest of the Company. All acts and decisions must be made without influences of personal interest, in the interest of family, kins or other person with whom the employees have personal relationship. This policy includes 2 matters as follows:

Internal Control
The Company has set up an internal control system in order to operate the Company’s business effectively and increase the credibility of its financial statements. In 2016, the Company hired MMN Syndicate Office Co., Ltd. operated by Mr. Marnit Aongphisud, Certified Public Accountant, who is competent in accounting and internal control, as a consultant of the Company to improve the internal control system and eliminate risks and unusual transactions. The Company annually reviews its internal control system and assesses risk management. Upon the expiration of the hiring contract, the Company plans to continue the contract and at the same time training its staffs for the job.

In addition, the Company has appointed Mr. Norawee Changlum as the Audit Committee’s secretary, coordinating with MMN Syndicate Office Co., Ltd. and proposing the result of internal audit to the Audit Committee at least once every 3 months.

(4) Meeting of the Board of Directors

The Board of Directors will arrange a meeting at least once every 3 months and may have special additional meetings, if necessary. The written notice of the meeting will be sent to directors for its consideration in advance at least 7 days before the meeting date except in case of an emergency or preserve the right or benefit of the Company. The directors can request any related disclosure from the Company’s secretary.

The Chairman of the Board of Directors and Managing Director will set the board meeting agenda together and each director is free to propose issues for a meeting agenda. The executive managements may attend some agendas during the meeting to provide information in details.

(5) Remunerations

The Company has established a policy to set remunerations of the directors and Audit Committee as an incentive to keep quality directors who meet the Company’s standard. The remuneration shall be at the same rate as paid by a similar industry and which is based on the result of operation of the Company. The remuneration has to be proposed for approval in the shareholders’ meeting.

Remuneration of the Managing Director and top executives should be in accordance with the scope of authorities and the policy of the board. For the best interest of the company, executives’ salaries, bonuses, and other long-term compensation will correspond to the Company’s performance and that of each executive

(6) Director and Management Training

The Board of Director will encourage and facilitate training for all internal parties related to corporate governance such as directors, Audit Committee, managements, etc. Training will enable them to continuously improve their performances. It can be either internal or external training.

The Company’s secretary will provide each new director with all documents and information useful to perform their duties, including introduction of the nature of the business and the operations.

Recruitment and Appointment of Directors and Senior Management Levels

Independent Committee

The Company must have independent directors at least one-third of total number of Board of Directors but not less than 3 persons.

Qualifications of the Independent Committee

• Holds no more than 1% of the total voting shares of the Company, its parent company, its subsidiaries, its associated companies or a juristic person who may have conflicts of interest, including shares held by any related person.
• Not be and have not been a director participating in management role, employee, staff, advisor who receives regular salary, or controlling person of the Company, its parent company, its subsidiaries, its associated companies, same-level subsidiaries or a juristic person who may have conflicts of interest, unless the foregoing status has ended for more than 2 years.
• Not being a person related by blood or legal registration, such as father, mother, spouse, sibling, and child, including spouse of the children, management, major shareholders, controlling persons, or persons to be nominated as management or controlling person of the Company or its subsidiaries.
• Not having a business relationship with the Company, its parent company, its subsidiaries, its associated companies or a juristic person who may have conflicts of interest, in the manner that may interfere with his/her independent judgment, or not being a major shareholder, non-independent director or management of any person having business relationship with the Company, its parent company, its subsidiaries, its associated companies or a juristic person who may have conflicts of interest.
• Not being an auditor of the Company, its parent company, its subsidiaries, its associated companies or a juristic person who may have conflicts of interest, in the manner that may interfere with his/her independent judgment, or not being a major shareholder, non-independent director or management of any person having business relationship with the Company, its parent company, its subsidiaries, its associated companies or a juristic person who may have conflicts of interest.
• Not being an professional advisor including legal or financial advisor who receives an annual service fee of exceeding Baht 2 million from the Company, its parent company, its subsidiaries, its associated companies or a juristic person who may have conflicts of interest, or not being a major shareholder, non-independent director, management or partner of the professional advisor.
• Not being appointed to represent the Company’s Director, its major shareholders or shareholders who are related to the Company’s major shareholders.
• Not having any characteristics by which him/her independent opinion may be affected.
• Not being a director assigned by the Company’s Board of Directors to take part in the business decisions of the Company, its parent company, its subsidiaries, its associated companies, same-level subsidiaries or a juristic person who may have conflicts of interest, and not being a director of the Company, its parent company, its subsidiaries, its associated companies, same-level subsidiaries.
• Having duties according to the Stock Exchange of Thailand’s regulations regarding the qualifications and scope of work of the Audit Committee.

In the case that the independent director being appointed as the independent director of the parent company, its subsidiaries, its associated companies, same-level subsidiaries, the Company has to disclose such information, including the remuneration received by the independent director in the Filing, Form 56-1 and Form 56-2.

Member of Audit Committee
The Company must have at least 3 audit committees.

Qualifications of Audit Committee

• Appointed by the Board of Directors or the shareholders
• Audit Committee must be independent and
  - Do not participate in decision making on the Company’s operations or its subsidiaries
  - Is not a director of the Company or its subsidiaries
• Has at least one audit committee whom has sufficient knowledge and experience to ensure the reliability of financial statements.
• Has served in the same manner as set forth in the Stock Exchange of Thailand on the features and scope of operations of the Audit Committee.

Nomination and Remuneration Committee
Nomination and Remuneration Committee, consist of 2 independent committees out of 3 committees, The committees have responsibility to recruit directors based on qualification, competency, experience, and the ability to attend the Board of Directors’ meetings consistently. The directors shall be appointed by a majority vote of the shareholders’ meeting in accordance with the following conditions and procedures:

• Each shareholder shall be entitled to the number of votes equivalent to the number of share held by him. One share shall have one vote.
• Each Shareholder may exercise all the votes to elect one or several persons, as the shareholders’ meeting may deem fit, as directors, but may not allot his votes to any person at any number.
• The directors shall be appointed in accordance with the majority vote. In the event of equal votes among the persons elected in order of respective high numbers of votes, the Chairman of that meeting shall have a casting vote.

Senior Management Level
In recruiting senior management level, the Executive Committee recruits senior management based on qualification, competency, and experiences related to the Company’s business, ability to complete the giving tasks. Senior management will be presented to Nomination and Remuneration Committee and board of committee to approve.

Corporate Governance of Subsidiaries
Corporate governance of subsidiaries and/or affiliates, the managements has been selecting qualified representative who have appropriated experiences and skills to be a representative of the Company manager and make a policy to control the subsidiaries and/ or joint venture.

For efficiency and transparency of the subsidiaries and/or affiliates governance, from 2014 onward, the Company has set rules to nominate and vote for a qualified director for subsidiaries which also need to be approved by Board of Directors. The representative director at the subsidiaries and/or affiliates must operates in the best interest of subsidiaries and/or affiliates by controlling the operation of the subsidiaries and/or affiliates according to strategies and business plan which were approved by the Company’s Board of Directors including operation under good governances. In addition, the representative shall receive an approval from the Company before voting for any issue which is significant as is required the board approval at the Company level. Nominating board the representative is based on proportions of the Company’s shareholding.

In case of subsidiaries, the Company set rules for nominated representative to monitor subsidiaries to implement policy regarding related transaction, gain or dispose of assets, any other significant related transaction and disclose the above transaction in the same rule conditions as those of the Company including the need to ensure the storage and accounting of the subsidiary which can be reviews and consolidate financial statements within deadlines.

Policy and Guidance Relating to Insider Information
The Company has a policy and ways to examine directors and executives concerning use of insider information not yet disclosed to the public for personal gains as follows:
1. The Company will educate directors and executives on the duty to report their shareholdings, shareholdings of their spouses and minor children to the Office of the Securities and Exchange Commission and the Stock Exchange of Thailand according to Section 59 and penalties in Section 275 of the Securities and Exchange Act, B.E. 2535.
2. The Company requires that the executives have to report any change in their shareholdings to the Office of the Securities and Exchange Commission according to Section 59 of the Securities and Exchange Act, B.E. 2535 in order that the Company can monitor stock trading of each executive.
3. The Company will send circular notices to executives to advise them of the important information that could affect stock prices in order to restrain trading their shares for the 1-month period before financial statements or such information are disclosed to the public and not to disclose such important information to other people. In case the non-disclosed information was used in a way that the Company or shareholders will suffer lost or damaged and the person responsible is executive-level person, the Board of Directors will consider the punishment and if the misconduct was carried out by lower-level managers, the managing director will be responsible for meting out the punishment.