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Bangladesh Online Limited

ANNUAL REPORT

2004ANNUAL REPORT

2004

BANGLADESH ONLINE LIMITED

A N N U A L R E P O RT

2 0 0 4

Table of Contents03 Corporate Directories

04 Mission Statement

05 Highlights of 2004

06 Selected Data of Shareholder, Investor & Customer

07 Value Added Status of Shareholders

08 Overview of Four Years

09 Result of Operation

10 Notice of the Eighth Annual General Meeting

11 Seventh Annual General Meeting

12 Chairman's Statement

18 Directors' Reports

19 Statement on Corporate Governance

20 Auditors' Report to the Shareholders

22 Balance Sheet

23 Profit and Loss Account

24 Statement of changes In Equity

25 Cash Flow Statement

26 Notes to the Financial Statements

Annexed Proxy Form

This document provides you with detailed and comprehensive informationabout the overall performance of Bangladesh Online Limited in 2004.

A printable version is also available at the BOL web site:www.bol-online.com

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ANNUAL REPORT 2004


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BOARD OF DIRECTORS

A S F RahmanChairman

Salman F RahmanVice Chairman

Chowdhury Hafizur RahmanManaging Director

Iqbal AhmedDirector

Osman Kaiser ChowdhuryDirector

Md. Asad Ullah, FCSCompany Secretary

MANAGEMENT COMMITTEE

Chowdhury Hafizur RahmanManaging Director

Syed Samiul WadoodChief Operating Officer

Ershad Shafi ChowdhuryChief Information Officer

Corporate D i rec tor ie s

ANNUAL REPORT 2004


ANNUAL REPORT 2004


4

MISSIONSTATEMENT

Each of our activities must benefitand add value to the common wealth

of our society. We firmly believe that, inthe final analysis we are accountable toeach of the constituents with whom we

interact; namely: our employees,our customers, our fellow citizens

and our shareholders

EQUALEMPLOYMENT

OPPORTUNITIES

BOL's longstanding policyis to afford equal employmentopportunities to all qualifiedindividuals without regard torace, color, religion, national

origin, age, sex orhandicap.

OBJECTIVES/GOAL

Connecting peopleto the internet and each

other is central toour object

VISION

BOL is a country leader inproviding internet services and

software & systems integration services. Weensure that our customers are successful byunderstanding and being responsive to their

needs, as well as working collaborativelywith them to provide one-stop faster, cost-

competitive and scalable services thatcreate competitive advantages in

the world of electroniccommunication.

VALUES

At BOL, we believe that how we dobusiness is paramount to our success. Our

commitment is exemplified by "The Beximco Way"a core values statement which highlights the importance

of Customer and Market Focus, High Performance, Integrityand Respect, Spirit, Collaboration and People Development.

BOL's employees are the key to living these values and BOL iscommitted to providing a work environment for our

employees that fosters The Beximco way. We are extremelyproud of our employees, who take seriously their

responsibility to embody these values in their relationshipswith each other, and with our customers, shareholders,

suppliers and community. We also are extremelyproud of our commitment to the communities

where our employees live and work. We believethat being part of the community includes

a responsibility to contribute morethan just jobs.


FOCUS ON BROADBAND/FOCUS ON GROWTH

BOL’s greatest differentiator for 2004 is its people and their strong reputation for proving timely,scalable and customer-tailored solutions for customers’ broadband deployment. BOL customer-tailoredBroad band solutions containing IP cable, DSL, software, broad band connectivity systems and systemsintegration services. For better service of Broadband, we have opened two new POP's (Point ofPresence) at Motijheel and Uttra.

SERVICE AREAS OF BROADBAND

GulshanBanani

BaridharaDhanmondi

EskatonMaghbazar

Kawran BazarMotijheelDilkhusaUttara

OUR CUSTOMERS

Government BodiesShipping Lines

Air LinesFinancial Institutions

Multinational CompaniesForeign MissionsDonor Agencies

NGOsEducational Institutes

Research Institutes

NEW WINDOW FOR GAME SOFTWARE DEVELOPMENT

BOL’s unprecedented success as an ISP & Web base software developer has been its openness towelcome new opportunities and invest in diversification. And signed an agreement with Deep RedGames Limited of the United Kingdom in December 2004 to develop 3D video games in Bangladesh andwill be also be partnering with one of the largest distributors for games and software titles in Europe,called Koch Media.

MARKET LEADERSHIP

In 2004 , we retain our market leadership through products. With price of product and quality andsupport service none of local IT company could not close or reach to BOL. Even our technical know howare quite rich and different to others.

All of these reasons, BOL is now most popular brand in Internet Access Bangladesh

High l ight s of 2004

ANNUAL REPORT 2004

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ANNUAL REPORT 2004

Se lected F inanc i a l and Stat i s t i ca l Data forSha reho lder , I nves tor and Cus tomer

6

We recommend that the following information be read in conjunction with our financial statement, theaccompanying notes and other information included in this report.

Particulars 2004 2003Changes

Amount %

Financial

Total Income 173,162 106,761 66,401 62.20Total Expenses (Excluding Income Tax) 65,776 69,293 (3,517) (5.07)Net Profit 107,386 37,469 69,917 186.60Capital Expenditure 6,434 4,588 1,846 40.24Cash and cash equivalents 2,034 802 1,232 153.62Total assets 376,983 393,403 (16,420) (4.17)Total debts & Liabilities 67,608 162,058 (94,450) (58.28)Shareholder' equity 309,375 231,345 78,030 33.73

Operating Data

Network Operating Centers 4 2 2 100.00No. Dial-up Telephone Lines 573 573 - -Number of employees - closing 53 49 4 8.16

Investment information

Number of Shareholders 1,144 841 303 36.03Stock price - closing 81.58 25.42 56.16 220.93Shareholder' equity per share 20.97 15.68 5.29 33.74Earning per share 6.94 2.54 4.40 173.23Proposed Dividend (Included 25% stock for 2004) 30% 15% 15.00 100.00

(Financial result & investment information in nearest '000 Taka expected percentage & ratio)

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ANNUAL REPORT 2004

VVaa ll uuee AAddddeedd SSttaattuu ss ooff SShhaa rreehhoo llddeerr ss

20.9

7

'04 '03 '02 '01

15.6

8

14.6

4

13.2

6

Shareholders Equity Per ShareNominal Value of Per Share Tk. 10

6.9

4

'04 '03 '02 '01

2.5

4

2.3

9

1.4

6

Earning Per ShareNominal Value of Per Share Tk. 10

30%

'04 '03 '02 '01

15%

15%

10%

DividendNominal Value of Per Share Tk. 10

81.5

8

'04 '03 '02 '01

25.4

2

22.3

2

19.7

0

Stock PerformanceNominal Value of Per Share Tk. 10

(Figure in Taka)

Particulars 2004 2003 2002 2001

Shareholders Equity Per Share 20.97 15.68 14.64 13.26Earning Per Share 6.94 2.54 2.39 1.46Divined 30% 15% 15% 10%Stock Performance 81.58 25.42 22.32 19.70

Nominal Value of per Share Tk. 10.00


ANNUAL REPORT 2004

Overv iew of four Year s

8

Particulars 2004 2003 2002 2001

Results of operations

Total Income 173,162 106,761 96,481 69,733 Net Profit 102,367 37,469 35,224 18,366 Cash inflow from operating activities 29,046 20,182 32,154 34,680 Basic earnings per share 6.94 2.54 2.39 1.46 Equity per share 20.97 15.68 14.64 13.26 Dividend per share (Cash) 5% 15% 15% 10%Dividend per share (Stock) 25% - - -

Financial Positions

Total Assets 376,983 393,403 368,265 334,537 Total Current Assets 145,440 108,466 80,461 53,621 Total Current Liabilities 67,608 49,558 39,764 26,510 Paid up capital 147,500 147,500 147,500 147,500 Shareholders' equity 309,375 231,345 216,001 195,527

Key Financial Ratios & Figures

Return on paid up capital 72.80% 25.40% 24.17% 12.59%Return on Investment 28.32% 9.52% 9.68% 5.55%Price Earning Ratio 10.49% 10.01% 9.35% 13.50%Current Ratio 2.15 : 1.00 2.19 : 1.00 2.02 : 1.00 2.02 : 1.00 Acid Test Ratio 1.47 : 1.00 1.21: 1.00 0.89 : 1.00 0.44 : 1.00

Other Key Data

Number of Shareholders 1,144 841 781 1,083 Stock price - closing 81.58 25.42 22.32 19.70Number of Employee 53 49 50 51

(Financial result & investment information in nearest '000 Taka expected percentage & ratio)

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ANNUAL REPORT 2004

Resu l t of Operat ionYear wi se Performance

173.1

6In

com

e

Total cost

Net P

rofi

t

70.7

9

102.3

7

YEAR 2004

(Figure in Million Tk.)

106.7

6

69.2

9

37.4

7

YEAR 2003


96.4

8

61.2

6

35.2

2

YEAR 2002


69.7

3

51.3

7

18.3

6

YEAR 2001


Incom

e

Total cost

Net P

rofi

t

Incom

e

Total cost

Net P

rofi

t

Incom

e

Total cost

Net P

rofi

t

(Figures in Million Tk.)

Particulars 2004 2003 2002 2001

Income 173.16 106.76 96.48 69.73Total Cost 70.79 69.29 61.26 51.37Net Profit 102.37 37.47 35.22 18.36

Nominal Value of per Share Tk. 10.00


ANNUAL REPORT 2004

BANGLADESH ONLINE LIMITED17 DHANMONDI R.A., ROAD NO. 2

DHAKA-1205

N O T I C E O F T H E E I G H T H A N N U A L G E N E R A L M E E T I N G

Notice is hereby given that the EIGHTH ANNUAL GENERAL MEETING of the Shareholders ofBangladesh Online Limited will be held on Saturday, the 4th June, 2005 at 12.00 noon at 1, ShahbagC/A, Dhaka to transact the following business:

A G E N D A

1. To confirm the proceedings of the Seventh Annual General Meeting of the Company held on30th June, 2004.

2. To receive, consider and adopt the Audited Accounts as of 31st December, 2004 together withreports of the Auditors and the Directors thereon.

3. To elect Director.

4. To declare 5% cash dividend and 25% stock dividend (Bonus Share).

5. To appoint Auditors for the year 2005 and to fix their remuneration.

6. To transact any other business of the Company with the permission of the Chair.

By order of the Board,Sd/-

(MD. ASAD ULLAH, FCS)Dated : April 27, 2005 Company Secretary

NOTES:

(1) The Record Date in lieu of Book Closure shall be on May 18, 2005. The Shareholders whosenames will appear in the Share Register of the Company on the Record Date will be entitledto the dividend.

(2) A member entitled to attend and vote at the General Meeting may appoint a Proxy to attendand vote in his/her stead. The Proxy Form, duly stamped, must be deposited at theRegistered Office of the Company not later than 48 hours before the time fixed for themeeting.

(3) Members are requested to notify change of address, if any, to the Company.

(4) Admission to the meeting room will be strictly on production of the attendance slip sentwith the Notice.

Not i ce of the E ighth AGM

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ANNUAL REPORT 2004

SSeevveenntthh AAnnnnuuaa ll GGeenneerraa ll MMeeeett ii nnggThe seventh Annual General Meeting (AGM) of shareholders ofBangladesh Online Limited was held on Wednesday the 30 June2004 at 3.30 pm at 1,Shahbag C/A , Dhaka. A good number ofshareholders attended the AGM.

In absence of Mr. A S F Rahman, Chairman of the company, Mr.Salman F Rahman, Vice Chairman of the Company, presided overthe meeting.

After recitation of the Holy Quran, The Chairman welcomed allthe shareholders for attending the 7th Annual General Meeting.With the permission of the chair, the meeting began and theshareholder expressed their valuable opinion on AuditedAccounts for the year ended 31st December, 2003.

Mr. Salman F Rahman, Vice Chairman of board of directorsthanked the shareholders and replied queries and explainedvarious comments of distinguished shareholders.

After electing Directors, approving the Audited Financial Statements, proposed cashdividend 15%, appointing of Auditors and fixing their remuneration by the Shareholders themeeting ended with a vote of thanks from the Chair.

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ANNUAL REPORT 2004


14

Dear Shareholders,

It is my pleasure to welcome you to the8th Annual General Meeting and present toyou the Annual Report for the year 2004.

Operations

2004 was an interesting year for thecompany. In spite of the political unrestand economic instability, the company wasable to increase both sales and profit aswell as conclude agreements for newbusiness segments.

With regard to internet sales, last year wehad decided to focus on growth areaswhich resulted in a dramatic increase inbroadband sales which more than offsetthe decline in dial-up sales. Withsubmarine cable connectivity just a yearaway, we focused on laying theinfrastructure to provide much fasterservices as soon as they are available viathe Submarine Fiber Optic Cable of SEA-ME-WE4 Consortium. Currently we have sixPOP’s or Points of Presence all over DhakaCity, at Dhanmondi, Gulshan, Maghbazar,Motijheel and Uttara. From these POP’s wedistribute broadband services tosubscribers in that locality using DSL cableand Wireless Broadband.

ANNUAL REPORT 2004


15

Cha i rman ' s S ta tement

Our diverse and flexible billing systemallows us to customize unique packages forour clients according to their needs. Thisbinds BOL and its subscriber closertogether with a strong mutualunderstanding that allows us to meet eachothers needs. We are looking forward toincrease broadband sales and ourprofitability even further this year.

Software sales were stable and we wereable to achieve similar level of sales in2004 as in 2003. However, we are nowfocusing on this aspect of our business withgreater vigor and expect to make majorbreakthroughs this year, specially withrespect to export of software. We arehopeful that software export will become acore business of the company in the yearsto come by taking advantage of our recenttie-up with Deep Red Games Ltd of UK,details of which have been provided lateron in this report.

During the year under review, the companyattained total sales of Tk. 110,661,526against Tk. 106,761,342 in the previousyear. This represents a modest 3.65%growth. Our main strategy and objectivewas to maintain our leading position in themarket, which we were successful inachieving. We were also able to reduce ouroperating expenses which was Tk.3,959,082 less then the previous yearwhich resulted in net profit after tax of Tk.102,367,251 which includes Tk. 62,500,000discount on early redemption of debenturewhich we were able to negotiate with theforeign debenture holder, compared to Tk.37,468,771 for the previous year.

Development of 3DComputer Games Software

One of the fastest growing in the worldtoday is the 3D Computer Games Softwaremarket which is estimated to be more thanUS$ 28 billion worldwide. However, thedevelopment of computer games isconcentrated in the US, EU, Australia,Japan and Korea. Very little developmentwork is taking place in the third worldincluding India and China. Computerprogrammers and artists who are good atfree hand drawing are needed for this typeof development work which is also verylabor intensive. Over 90% of the cost ofproducing a computer game is salaries andwages. In Bangladesh today ourUniversities, Institutes and Art colleges areproducing talented young men and womenwho meet these requirement.

Setting up of a world class gamesdevelopment studio with state of the arthardware and games engines in Bangladeshwhich would use locally availableworkforce would be a tremendouscompetitive advantage for exports ofgames software from Bangladesh.

With this in mind, after extensivediscussions, BOL entered into a jointventure agreement with Deep Red GamesLimited of the United Kingdom inDecember 2004 . Deep Red Games isranked as one of the top 5 gamingcompanies in the UK. They will send anexpert team to Bangladesh to train thelocal talent and develop high quality 3Dgames. They will also provide managementpersonnel for the Bangladesh studio. KochMedia, one of the largest distributors forgames and software titles in Europe, is alsopart of the joint venture and through themwe will have ready access to distributionworld wide. We are very excited about thisnew line of business and also veryencouraged by the enthusiasm shown byour current and prospective employees.Our estimates indicate this joint venturewill generate profits within a very shorttime thereby contributing significantly tothe growth of the company.

ANNUAL REPORT 2004


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ANNUAL REPORT 2004

Contribution to theNational Exchequer

During the year 2004 Bangladesh OnlineLimited has contributed Tk. 7.16 millionsto the national exchequer in form of ValueAdded Tax (VAT) which is the highest forListed IT Company in Share Market.

Dividend

The Board of directors of BangladeshOnline Ltd is pleased to recommend 5%cash dividend and 25% stock dividend i.e. 1(one) bonus share for each 4 (four) shares.

This is the third consecutive year that TheBoard of Directors of the companyrecommended highest dividend as a listedIT firm of Dhaka and Chittagong SotckExchanges for their Shareholders.

Conclusion

At the end, I would like to reiterate that,2004 has been a successful year for yourcompany. I am glad that our customershave demonstrated confidence in ourcompany's people, products and services.Moreover, I appreciate the tireless effortsput up by our employees for welfare andadvancement of the organization. Above allit is our valued shareholders who hasalways been the sources of inspiration forall our achievement.

I therefore sincerely thank all of you andlook forward to your continued support andco-operation in the future.


Dated : 27 April, 2005Dhaka

ANNUAL REPORT 2004


18

Dear Shareholders,

The Directors have pleasure in submitting their report and the audited financial statements of the Company for theyear ended 31st December, 2004 together with the Auditors Report thereon.

(Figure in '000 Taka)

2004 2003

Financial Reports and Profit Appropriations

Net Profit before providing Income Tax 107,386 37,469Less: Provision for Income Tax 5,019 -Net Profit after Tax 102,367 37,469Add: Un-appropriated profit from the previous year 15,854 17,709Profit available for appropriation 118,221 55,178

Recommended for appropriations

Transfer to Tax-holiday reserve 41,267 14,987Proposed Dividend Cash (For 2004 - 5% and 2003-15%) 7,375 22,125Stock, (Bonus Share) (For 2004 -25 %) 36,875 -Dividend Distribution Tax (Both Cash & Stock) 4,425 2,212

(89,942) (39,326)

Un-appropriated Profit 28,279 15,854

Note: Proposed Dividend has not been accounted for in the audited financial Statement.

Dividend

The Board of directors recommend 5% Cash dividend and 25% Stock dividend (Bonus Share) per share of Taka 10.00each fully paid up for the approval of the shareholders for the year ended 31 December 2004.

Directors

In accordance with Articles 125 and 126 of the Articles of Association of the Company, Mr. Salman F Rahman retiresby rotation and being eligible offers himself for re-election.

Auditors

The retiring Auditors M/S M. J. Abedin & Co., Chartered Accountants, National Plaza (6th Floor) 1/G, Free SchoolStreet, Sonargaon Road, Dhaka -1205, being eligible offer themselves for re-appointed as Auditors' of the Companyfor the year 2005.


Dated : 27 April, 2005Dhaka

DDii rreeccttoorrss ' RReeppoorrtt ttoo tthhee SShhaarreehhoollddeerrss


SSttaatteemmeenntt oonn CCoorrppoorraattee GGoovveerrnnaannccee

Bangladesh Online Limited (BOL) is committedto uphold the highest standard of corporategovernance. Proper accountability at each levelof corporate management and transparency inevery sphere of business activities is our keyfocus. We are pleased to report our compliancewith the core corporate governance issues asset out in our ethical business guidelines.

Board and its Compositions

The board of directors is the highest level of authorityin the organization structure of BOL. The board isresponsible for the overall direction and it isultimately accountable to the shareholders for theactivities, strategies and performance of thecompany. The board of directors of Bangladesh OnlineLimited comprises of 5 members with Mr. A S FRahman as Chairman and Mr. Salman F Rahman asVice-Chairman.

Board Functioning progress

The board meets frequently to deal with issues thatrequire board approval or direction. To enable theboard to function effectively and allow directors todischarge their responsibilities effectively, full andtimely information is made available to them byprofessional managers.

Management Committee

A three member management committee headed bythe Managing Director is responsible forimplementation of strategic and operating plans ofthe business. The company has a well definedmanagement structure with appropriate hierarchymanned with committed professional managers whocarry out the day to day operational activities of thebusiness.

Internal Control - Pending

BOL employs a good system of internal controlincluding internal financial control to ensurecompliance of its activities with the businessobjectives. The effectiveness of the controlmechanism already in place is periodically reviewed.There are systems for careful monitoring of theactivities to make sure that the standard and

procedures set out for each business function is beingeffectively complied with.

BOL has a well-defined management structure withclearly identified responsibilities and appropriatechain of accountabilities.

The operational units are required to prepare annualbudgets and actual performance against the budget isactively monitored throughout the year at themanagement level.

Going Concern

The director believe, after reviewing the financialstatements, there is reasonable expectation that thecompany have adequate resources to continueoperation for the foreseeable future. For this reason,the directors have adopted the going concern basis inpreparing the financial statement. - its done

Rights and Relations with shareholders

Control Rights of Shareholders - at annual generalmeetings, shareholders have rights of participationand supervision. They have the right to ask questionof and request of information from the boardregarding item on the agenda to extent necessary tomake an informed judgment of the company's affair.Relations with Shareholders - The annual generalmeetings are used as an important opportunity forcommunication with both institutional and generalshareholders. In addition, the company maintainrelations with shareholders through the corporateaffairs secretarial departments.

The following information can be addressed throughthe secretarial department:

• Dividend payment enquires• Dividend mandate instruction• Loss of share certificate/dividend warrants• Notification of changes of address• Transfer of Shares

The board believes that it is important to respondadequately to all the queries of both institutional andgeneral shareholders. At the AGM the shareholdersare afford an opportunity to raise with the board anyspecific question they have concerning the Company.In addition, meetings are also held betweenindividuals directors and institutional shareholders atvarious times during the year.

19

ANNUAL REPORT 2004


ANNUAL REPORT 2004

We have audited the accompanying Financial Statements of Bangladesh Online Limited consisting ofBalance Sheet, Profit and Loss Account and the Statement of Changes in Equity and Cash Flow as wellas the Notes to the financial statements for the year from January 1 to December 31, 2004.

The company law requires the directors to prepare financial statements which give a true and fair view.In preparing financial statements which give a true and fair view, it is fundamental that appropriateaccounting policies are selected and applied consistently.

It is our responsibility to form an independent opinion, based on our audit, on those statements and toreport our opinion to you, in accordance with section 213 of the Companies Act, 1994.

We conducted our audit in accordance with Bangladesh Standards on Auditing. These standards requirethat we plan and perform the audit to obtain reasonable assurance about whether the financialstatements are free of material misstatement. Evidence supporting the amounts and disclosures in thefinancial statements is examined on a test basis within the framework of the audit. An audit alsoincludes assessing the accounting principles used and significant estimates made by the board ofdirectors, as well as evaluating the overall financial statements presentation. We believe that our auditprovides a reasonable basis for our opinion.

In our opinion, based on our audit, the financial statements referred to above give a true and fair viewof the financial position, the results of operations and cash flows of the company, in all materialrespects, for the year referred to above, in accordance with the Companies Act 1994, the Securitiesand Exchange Rules 1987 and the Bangladesh Accounting Standards.

We also report that :

(a) we have obtained all the information and explanations which to the best of our knowledge andbelief were necessary for the purpose of our audit and made due verification thereof;

(b) in our opinion, proper books of accounts as required by law have been kept by the company so faras it appeared from our examination of those books ;

(c) the Company's Balance Sheet and Profit and Loss Account dealt with by this report are inagreement with the books of accounts ; and

(d) the expenditure incurred were for the purpose of the Company's business.

National Plaza (6th Floor) M. J. Abedin & Co.1/G, Sonargaon Road Chartered AccountantsDhaka-120527 April, 2005

AAuudd ii ttoorr ss RReeppoorr tt ttoo tthhee SShhaarreehhoo llddeerr ss

20

F inanc i a l s

BBaa ll aannccee SShheeeettAS AT 31 DECEMBER 2004

Note 2004 2003

ASSETS

Non-Current Assets 231,543,247 284,936,362

Property, Plant and Equipment - Carrying Value 8 226,769,525 279,109,996Preliminary Expenses, net of amortisation - 10,848Pre-operating Expenses, net of amortisation 9 454,182 1,495,978Long Term Security Deposits 10 1,819,540 1,819,540Investment in Shares of Beximco Zenith Ltd. 11 2,500,000 2,500,000

Current Assets 145,439,657 108,466,402

Inventories 12 1,237,143 2,658,298Accounts Receivable 13 97,499,312 59,394,857Advances, Deposits and Prepayments 14 44,669,062 45,611,451Cash and Cash Equivalents 15 2,034,140 801,796

Total Assets Tk. 376,982,904 393,402,764

EQUITY AND LIABILITIES

Shareholders' Equity 309,374,791 231,345,040

Issued Share Capital 16 147,500,000 147,500,000Tax- Holiday Reserve 17 84,920,607 43,653,230Retained Earnings 76,954,184 40,191,810

Non-Current Liabilities - 112,500,000

10% Debenture - 112,500,000

Current Liabilities and Provisions 67,608,113 49,557,724

Accounts Payable & Other Liabilities 18 62,589,472 49,557,724Provision for Income Tax 5,018,641 -

Total Liabilities and Shareholders' Equity Tk. 376,982,904 393,402,764

The Notes are an integral part of the Financial Statements.

Approved and authorised for issue by the board of directors on 27 April 2005 and signed for and onbehalf of the Board :

C H Rahman Iqbal Ahmed Md. Asad UllahManaging Director Director Company Secretary

Per our report of even date.

Dhaka M. J. Abedin & Co.27 April 2005 Chartered Accountants

ANNUAL REPORT 2004


22

PPrrooff ii tt aanndd LLooss ss AAccccoouunnttFOR THE YEAR ENDED 31 DECEMBER 2004

Tax Holiday TaxableNote Jan - Nov '04 December '04 2004 2003

Revenue (Turnover) from Net Sales 19 101,130,052 9,531,474 110,661,526 106,761,342Operating Expenses 20 (48,210,178) (4,197,030) (52,407,208) (56,366,290)

Gross Profit 52,919,874 5,334,444 58,254,318 50,395,052

Administrative and Selling Expenses 21 11,286,507 1,029,275 12,315,782 11,873,637Amortisation of Preliminary Expenses 9,944 904 10,848 10,848Amortisation of Preoperating Expenses 954,980 86,816 1,041,796 1,041,796

(12,251,431) (1,116,995) (13,368,426) (12,926,281)

Discount on early redemption of debenture 62,500,000 - 62,500,000 -

Net Profit Before Tax 103,168,443 4,217,449 107,385,892 37,468,771Provision for Income Tax 3,753,406 1,265,235 5,018,641 -Net Profit After Tax Transferred to Statement of Changes in Equity 99,415,037 2,952,214 102,367,251 37,468,771

Basic Earnings Per Share (Par value Tk 10/-) 22 6.94 2.54

Number of shares used to compute EPS 14,750,000 14,750,000






ANNUAL REPORT 2004


23


ANNUAL REPORT 2004

SS ttaatteemmeenntt ooff CChhaannggeess iinn EEqquu ii ttyyFOR THE YEAR ENDED 31 DECEMBER 2004

Particulars Share Tax holiday Retained TotalCapital Reserve Earnings

At the beginning of year 147,500,000 43,653,230 40,191,810 231,345,040Net Profit after tax for 2004 102,367,251 102,367,251Transfer to Tax Holiday Reserve (Note 23) 41,267,377 (41,267,377) -Cash dividend of prior period (2003) (22,125,000) (22,125,000)Dividend Distribution Tax (2003) (2,212,500) (2,212,500)

At the end of year 147,500,000 84,920,607 76,954,184 309,374,791

Total Number of Shares 14,750,000Shareholders' Equity per share Tk. 20.97






24

CCaasshh FF llooww SSttaatteemmeennttFOR THE YEAR ENDED 31 DECEMBER 2004

2004 2003

Cash Flows from Operating Activities:

Cash receipts from customers and others 72,557,072 79,084,071Cash paid to suppliers and employees (43,511,164) (58,807,098)

Cash Generated from Operations 29,045,908 20,276,973Income Tax paid & deducted at source - (95,100)

Net cash Generated From Operating Activities 29,045,908 20,181,873

Cash Flows from Investing Activities:

Acquisition of Property, Plant and Equipment (6,434,114) (4,587,892)

Net cash Used in Investing Activities (6,434,114) (4,587,892)

Cash Flows from Financing Activities:

Dividend paid (21,379,450) (18,529,405)

Net cash Used in Financing Activities (21,379,450) (18,529,405)(Decrease)/Increase in Cash and Cash Equivalents 1,232,344 (2,935,424)Cash and Cash Equivalents at Beginning of Year 801,796 3,737,220

Cash and Cash Equivalents at End of Year Tk. 2,034,140 801,796






ANNUAL REPORT 2004


25

NNootteess ttoo tthhee FF ii nnaanncc ii aa ll SS ttaatteemmeenntt31 DECEMBER, 2004

1. The Company

The Bangladesh Online Ltd. (the "Company"), a member of BEXIMCO Group, came into existence asa public limited company on November 3, 1996. It commenced commercial operation in December1, 1999 and went for public issue of shares in 2000. The shares of the Company are listed with theDhaka and Chittagong Stock Exchanges of Bangladesh.

The registered office of the Company is located at House No. 17, Road No. 2, DhanmondiResidential Area, Dhaka. The sales and administrative office of the company are located at 32, KaziNazrul Islam Avenue of Dhaka.

2. Business Activities

The company is primarily engaged as an Internet Service Provider (ISP) and Web Page SoftwareDeveloper in Bangladesh. BOL's ISP service includes Dial-up Internet Access, Corporate BroadService, Web Designing & Web Hosting Services, corporate Network Solutions and ComputerPeripherals.

3. Basis of Preparation, Presentation and Disclosures of Financial Statements

The basis of preparation of Financial Statements is the "Historical Cost Convention".

The Basis of presentation and disclosures of information are based on the relevant and applicablerequirements of the :

Companies Act 1994;Securities and Exchange Rules 1987;Listing Regulations of Dhaka and Chittagong Stock Exchanges; and Bangladesh Accounting Standards (BASs) adopted by the Institute of Chartered Accountants ofBangladesh (ICAB) based on International Financial Reporting Standards.

4. Reporting Currency and Level of Precision

The financial statements are presented in Bangladesh currency (Taka), which have been roundedoff to the nearest Taka except where indicated otherwise.

Figures in brackets indicate deductions.

5. Comparative Amounts

Wherever necessary figures of the prior year has been re-arranged to conform with the currentyear's presentation.

6. Accounting for Dividend (Cash) of Prior Year (2003)

Shareholders in the 7th Annual General Meeting of the Company held on June 30, 2004 approved15% cash dividend for the year 2003. Accordingly the total dividend amount of Tk. 22,125,000 of2003 and dividend distribution tax thereon of Tk. 2,212,500 have been accounted for in 2004.

7. Principal Accounting Policies

(a) The Accounting policies and methods of computation used in preparation of the financialstatements for the year ended 31 December 2004 are consistent with those adopted in thefinancial statements for the year ended 31 December 2003.

(b) Revenue Recognition

Sales are accounted for on preparation of invoices after delivery of services & hardware goods.

In conformity with the requirements of provisions of BAS 18 "Revenue", VAT as included insales price and collected on behalf of customers is not considered as "Revenue".

ANNUAL REPORT 2004


26

(c) Property, Plant and Equipment

These are initially stated at cost of acquisition and subsequently stated at cost lessaccumulated depreciation. The cost of acquisition of an asset comprises its purchase priceand any directly attributable cost of bringing the asset to its working condition for itsintended use inclusive of inward freight, duties and non-refundable taxes. In respect of majorprojects involving construction, related pre-operational expenses form part of the value ofasset capitalized. Expenses capitalized also includes pre-operational borrowing cost.Expenditure incurred after the assets have been put into operation, such as repairs &maintenance is normally charged off as revenue expenditure in the period in which it isincurred. In situation where it can be clearly demonstrated that the expenditure has resultedin an increase in the future economic benefit expected to be obtained from the use of thefixed assets, the expenditure is capitalized as an additional cost of the assets. Software andall up gradation/enhancement are generally charged off as revenue expenditure unless theybring similar significant additional benefits.

On retirement or otherwise disposal of fixed assets, the cost and accumulated depreciation areeliminated and any gain or loss on such disposal is reflected in the profit and loss account whichis determined with reference to the net book value of the assets and the net sales proceeds.

(d) Depreciation

No depreciation is charged on Land and Land Development and Telephone Line Cost. In respectof all other fixed assets, depreciation is provided to amortize the cost of the asset aftercommissioning, over their expected useful economic lives. Depreciation is calculated using thestraight-line method. Half year's depreciation is charged on additions and no depreciation isprovided on retirement, irrespective of date of addition or retirement respectively.

The annual depreciation rates applicable to the principal categories of assets are:

Internet System Hardware 18%Furniture & Fixture 10%Air Conditioner 18%Office Equipment 20%V-Sat Tower 10%Under Ground Cable Installation 10%Generator 15%Transport & Vehicle 20%

(e) Pre-operating Expenses

This is being amortized over 5 years commencing from the year 2000 in respect of DhanmondiCenter and from the year 2001 in respect of Eskaton Center .

(f) Investment in shares of Beximco Zenith Limited

This is valued at cost.

(g) Inventories

Inventories are stated at the lower of cost and net realizable value.

The cost is calculated on weighted average method consistently and net realizable value is basedon estimated selling price less any further costs expected to be incurred to make the sale.

(h) Cash and Cash Equivalents

This comprises cash in hand and at banks.

(i) Income Taxes

Tax holiday has been expired on 30 November 2004 . Tax has been provided for the taxableperiod of one month at 30% tax rate being the tax rate applicable for publicly tradedcompany. It also includes earlier year's tax claimed by the income tax authority u/s 30 AA ofIncome Tax Ordinance 1984 and tax on other income.

(j) Cost of Post Employment Benefits

The company's contributions to group insurance is charged off as revenue expenditure in theperiod to which the contributions relate.

ANNUAL REPORT 2004


27

(k) Tax Holiday Reserve

This is being created out of tax holiday profit to invest in the same undertaking or in any newindustrial undertaking or in stocks and shares of listed companies or in government bonds orsecurities or for other purposes as required by the Income Tax Ordinance 1984.

(l) Proposed Dividend and Dividend Distribution Tax

Dividend proposed by the board of directors for the year under review and DividendDistribution Tax thereon shall be accounted for after approval by the shareholders in theannual general meeting.

(m) Earnings Per Share (EPS)

This has been calculated by dividing the basic earnings by the weighted average number ofordinary shares outstanding during the year.

Basic EarningsThis represents earnings for the year attributable to ordinary shareholders. As there was nopreference dividend, minority interest or extra ordinary items, the net profit after tax for theyear has been considered as fully attributable to the ordinary shareholders.

Weighted Average Number of Ordinary Shares Outstanding During the yearThis represents the number of ordinary shares outstanding at the beginning of the year plusthe number of ordinary shares issued during the year multiplied by a time-weighting factor.The time-weighting factor is the number of days the specific shares are outstanding as aproportion of the total number of days in the period.

Diluted Earnings Per ShareNo diluted EPS is required to be calculated for the year as there was no scope for dilutionduring the year under review.

(n) Foreign Currencies

The financial records of the company are maintained and the financial statements are statedin Bangladesh Taka. Foreign currency transactions are recorded at the applicable rates ofexchange ruling at the transaction date and, amount receivable/payable, if any, denominatedin foreign currencies at the balance sheet date are translated at the applicable rates ofexchange ruling at that date. Exchange differences are charged off as revenue expenditure.

The rate of relevant foreign exchange at year end is :

2004 2003

1 US Dollar ($) = Tk. 61.45 58.73

8. Property, Plant and Equipment : Tk. 226,769,525

Particulars Land & Land TelephoneInternet Office Furniture,

Generator TotalDevelopment Line CostSystem Equipment VSAT Tower

Hardware & & Motor & UndergroundAir Condition Vehicles, Car Cable Installation

CostAt 31 December 2003 220,140,411 11,281,500 79,254,841 8,656,752 17,743,096 1,909,987 338,986,587Deduction in 2004 (40,140,411) - - - - - (40,140,411)Additions in 2004 - - 5,437,820 755,777 240,517 - 6,434,114At 31 December 2004 180,000,000 11,281,500 84,692,661 9,412,529 17,983,613 1,909,987 305,280,290 Depreciation At 31 December 2003 - - 48,691,604 5,558,379 4,729,286 897,322 59,876,591 Charged for 2004 - - 14,755,275 1,806,066 1,786,335 286,498 18,634,174 At 31 December 2004 - - 63,446,879 7,364,445 6,515,621 1,183,820 78,510,765 Carrying ValueAt 31 December 2004 Taka 18,000,000 11,281,500 21,245,782 2,048,084 11,467,992 726,167 226,769,525 Carrying ValueAt 31 December 2003 Taka 220,140,411 11,281,500 30,563,237 3,098,373 13,013,810 1,012,665 279,109,996

Deduction of Tk. 40,140,411 represents interest on debenture earlier capitalized now written backas it is no longer payable.

ANNUAL REPORT 2004


28

9. Pre-operating Expenses : Tk. 454,182

This is arrived at as follows :Dhanmondi Eskaton Total

Center Center

Total Amount 2,938,071 2,270,909 5,208,980Less :Amortised upto year 2003 (2,350,456) (1,362,546) (3,713,002)Balance as on 31.12.2003 587,615 908,363 1,495,978Less : 1/5th Amortized during the year 2004 (587,615) (454,181) (1,041,796)

Tk. - 454,182 454,182

The balance of Tk. 454,182 shall be amortized in the year 2005.

10. Long Term Security Deposits : Tk. 1,819,540

These were deposited with :2004 2003

Telephone Line 1,370,000 1,370,000For Bandwidth 449,540 449,540

Tk. 1,819,540 1,819,540

11. Investment in Shares of Beximco Zenith Limited : Tk. 2,500,000

This represents 250,000 shares of Tk. 10 each of Beximco Zenith Limited a Joint Venture companyincorporated in Bangladesh. This represents 50% of total paid-up capital of Beximco ZenithLimited. This is a non-listed company, and therefore, no market value is available.

12. Inventories : Tk. 1,237,143

This consists of :2004 2003

PIN Mailers 969,632 208,843CD Rom 267,511 100,157Computer Peripheral - 2,349,298

Tk. 1,237,143 2,658,298

13. Accounts Receivable : Tk. 97,499,312

This is unsecured, considered good is falling within one year.

No amount was due by the Directors (including Managing Director), Managing Agent, Managers andOther Officers of the Company and any of them severally or jointly with any other person.

14. Advances, Deposits and Prepayments : Tk. 44,669,062

This consists of:2004 2003

Advances: 43,277,368 42,507,683Advance to Shinepukur Holdings Ltd. 40,000,000 40,000,000Advance Against Expenses 3,277,368 2,507,689

Deposits: 920,618 2,743,265Lease Deposit 474,412 2,080,167Sundry Security Deposits 352,700 306,650Bank Guarantee 37,860 37,860Earnest Money 55,646 318,588

Prepayments: 471,076 360,503Rent - Network Operating Centers 249,000 118,000Office Insurance 153,770 182,841Group Insurance 68,306 59,662

Tk. 44,669,062 45,611,451

ANNUAL REPORT 2004


29

No amount was due by the Directors (including Managing Director), Managing Agent, Managers andOther Officers of the Company and any of them severally or jointly with any other person.

No amount was due from any associated undertaking.

The advances are good and unsecured.

15. Cash and Cash Equivalents : Tk. 2,034,140

This consists of :2004 2003

Cash in hand 665,010 308,423Cash at Banks in Current Deposit Accounts 1,369,130 493,373

Tk. 2,034,140 801,796

16. Issued Share Capital : Tk. 147,500,000

This represents:

(a) Authorized:

200,000,000 Ordinary Shares of Tk. 10/- each Tk. 2,000,000,000 2,000,000,000

(b) Issued, Subscribed and Paid-up:

14,750,000 Ordinary Shares of Tk. 10/- each fully paid-up in cash Tk. 147,500,000 147,500,000

(c) Compositions of Shareholdings:

Particulars 2004 2003No. of Shares % No. of Shares %

Sponsors 4,500,000 30.51 4,500,000 30.51Foreign Investors 5,747,500 38.97 6,846,000 46.41Local Financial Institutions 101,500 0.68 109,500 0.74General Public 4,401,000 29.84 3,294,500 22.34

Total 14,750,000 100.00 14,750,000 100.00

(d) Distribution Schedule - Disclosure under the Listing Regulations of Stock Exchanges:

This distribution schedule showing the number of Shareholders and their Shareholdings inpercentage has been disclosed below as a requirement of the "Listing Regulations of Dhaka &Chittagong Stock Exchanges :

Shareholders Range in number of Shares Number of % of Total Number of % of ShareHolders Holders Shares Capital

Less than 500 shares - - - -500 to 5,000 shares 1,004 87.76 1,212,000 8.225,001 to 10,000 shares 61 5.33 501,000 3.4010,001 to 20,000 shares 42 3.67 601,500 4.0820,001 to 30,000 shares 12 1.05 297,500 2.0230,001 to 40,000 shares 6 0.52 205,000 1.3940,001 to 50,000 shares 4 0.35 189,000 1.2850,001 to 100,000 shares 3 0.27 240,000 1.62100,001 to 1,000,000 shares 9 0.79 3,014,000 20.43Over 1,000,000 shares 3 0.26 8,490,000 57.56Total 1,144 100.00 14,750,000 100.00

(e) Option on unissued shares:

There is no option regarding authorized capital not yet issued but can be used to increasedissued, subscribed and paid-up capital through the issuance of new shares.

ANNUAL REPORT 2004


30

(f) Market Price:

The shares of the Company are listed in the Dhaka and Chittagong stock exchanges and quoted(average price) at Tk. 81.66 per share and Tk. 81.50 per share in the Dhaka and Chittagongstock exchanges respectively on 31 December, 2004.

(g) Voting Rights:

The rights and privileges of the shareholders are stated in the Bye-laws (Articles of Association)of the Company.

17. Tax - Holiday Reserve : Tk. 84,920,607

This is arrived at as follows :2004 2003

Opening Balance 43,653,230 28,665,722Add : 40% of profit for the year 41,267,377 14,987,508

Tk. 84,920,607 43,653,230

This has been provided on tax holiday profit as per Income Tax Ordinance 1984 to invest in thesame undertaking or in any new industrial undertaking or in stocks and shares of a public companyor in govt. bonds or securities or for other purposes specified in this respect as one of theconditions of granting tax holiday.

18. Accounts Payable & Other Liabilities : Tk. 62,589,472

This is payable against:2004 2003

Debenture/Interest on Debenture 50,000,000 40,140,411VAT Payable 606,971 583,661Audit Fee Payable 50,000 30,000Others 11,932,501 8,803,652

Tk. 62,589,472 49,557,724

19. Revenue (Turnover) : Tk. 110,661,526

Sales of Internet Services 54,923,073 51,193,559Less : VAT 7,163,879 6,677,421Net Sales After VAT 47,759,194 44,516,138Sales of Web Page Software 60,007,031 59,119,884Computer Peripheral 2,895,301 3,125,320

Tk. 110,661,526 106,761,342

20. Operating Expenses : Tk. 52,407,208

VSAT Charge 15,222,210 14,738,736Depreciation 18,634,174 17,652,704Plant Lease Rental 3,301,980 10,678,548Telephone Line Rental 1,182,646 1,195,230Web Rental & SMS Charge 687,260 266,037Rent - Network Operating Centers 963,608 608,880Salaries & Allowances 6,914,519 5,490,231Cost of Computer Peripheral 2,349,298 2,738,362Cost of PIN Mailer & CD Rom 1,277,061 1,521,955Repairs & Maintenance 158,697 240,456Electricity, Gas and Water 793,095 580,277Insurance Premium 312,660 249,345Renewal, Rates, Registration 610,000 405,529

Tk. 52,407,208 56,366,290

ANNUAL REPORT 2004


31

21. Administrative and Selling Expenses : Tk. 12,315,7822004 2003

Salaries & Allowances 3,955,192 3,921,879Office Rent 690,965 570,000Renewal, Rates, Registration 466,648 364,598Travelling & Conveyance 258,533 196,623Telephone, Internet, Fax, Pager, Postage 834,800 618,122Entertainment 241,523 183,458Printing and Stationery 390,260 482,984Charges for Security Guard 369,939 447,425Electricity, Gas and Water 444,719 392,371Car Running Expenses 284,012 277,009Car Lease Rental 1,722,745 1,127,400Repairs & Maintenance 240,528 247,504Legal & Professional fees 250,000 250,000General Expense 35,725 22,280Bank Charges 79,292 107,589Insurance Premium 374,045 200,460Auditors' Remuneration (Audit Fee for 2004) 50,000 30,000Promotional Expenses 1,626,856 2,433,935

Tk. 12,315,782 11,873,673

The number of employees of the Company at 31 December, 2004 was 53 and all of them receivedsalaries and allowances above Tk. 3,000 per month.

22. Basic Earnings Per Share (EPS)

This Computation of EPS is given below:2004 2003

(a) Earnings attributable to the Ordinary Shareholders (Net Profit after Tax) 102,367,251 37,468,771

(b) Weighted average number of Ordinary Shares outstanding during the year 14,750,000 14,750,000Tk. 6.94 2.54

23. Tax - Holiday Reserve : Tk. 41,267,377

This is provided as per provisions of the Income Tax Ordinance , 1984 as a condition of granting taxholiday which represents 40% of the net profit for tax holiday period.

24. Payment/Perquisites to Directors

No amount of money was spent by the Company for compensating any member of the Board forservices rendered.

25. Capital Expenditure Commitment

There was no capital expenditure contracted but not incurred or provided for at 31 December, 2004.

There was no material capital expenditure authorized by the board but not contracted for at 31December, 2004.

26. Operating Lease Commitments

The future annual rentals payable are as follows:

Expiring within one year . . . . . . . . . . . . . . . . . . . . 787,653

Expiring after one year but not more than five years . . . . 5,339,170

Expiring after five years . . . . . . . . . . . . . . . . . . . . . . . Nil

27. Claims Not Acknowledged

There was no claim against the Company not acknowledged as debt as on 31 December, 2004.

ANNUAL REPORT 2004


32

28. Foreign Exchange Earned

In 2004, Company earned Foreign Exchange USD 10,863.21which is equivalent BD Tk. 662,656.00against service provide for software.

29. Commission, Brokerage or Discount against Sales

Distributors' commission of Tk. 148,891 (year 2003 : 126,116) was incurred and paid during the year2004 to the city wide Distributors of the company on account of sales of Recharge Cards & I - Kit.

30. Payment in Foreign Currency

In 2004, the company remitted foreign currency in respect of Bandwidth & Membership Feeamounting to USD 80,000.00 & 2,500.00 respectively which equivalent BD Taka 4,946,125.

No other expenses including royalty, technical expert and professional advisory fee, etc. wasincurred or paid by the company in foreign currency during the year 2004.

31. Related Party Transactions

The Company carried out a number of transactions with related parties/associated undertakingsin the normal course of business and on arms' length basis. The nature of transactions and theirtotal value is shown below:

Name of Related Parties Nature of Value of ReceivableTransactions Transactions at year end

in 2004

Beximco Textiles Ltd. Software Sales 3,700,000 3,150,000Beximco Knittings Ltd. Software Sales 1,900,000 1,650,000Beximco Denims Ltd. Software Sales 1,900,000 1,725,000Beximco Holdings Ltd. Software Sales 3,800,000 2,920,000Beximco Synthetics Ltd. Software Sales 1,850,000 1,655,000Shinepukur Holdings Ltd. Software Sales 3,100,000 2,865,000Padma Textile Mills Ltd. Software Sales 3,250,000 2,455,000Beximco Fashions Ltd. Software Sales 3,800,000 1,545,000Beximco Apparels Ltd. Software Sales 2,730,000 530,000Shinepukur Ceramics Ltd. Software Sales 525,000Beximco Pharmaceuticals Ltd. Software Sales 585,000Beximco Infusion Ltd. Software Sales 350,000Shinepukur Holdings Ltd. Advance against Land 40,000,000

32. Post Closing Events

Subsequent to the balance sheet date, the directors recommended 5% cash dividend and 25% stockdividend (bonus share). The dividend proposal is subject to shareholders' approval at the forth-coming annual general meeting.

Except the fact stated above, no circumstances have arisen since the balance sheet date whichwould require adjustment to, or disclosure in, the financial statements or notes thereto.


Dhaka27 April 2005

ANNUAL REPORT 2004


33

B A N G L A D E S H O N L I N E L I M I T E DRegistered Office : 17, Dhanmondi R/A, Road # 2, Dhaka-1205

PROXY FORM

I/We...................................................................... of .............................................. being a member of

Bangladesh Online Limited hereby appoint Mr./Ms........................................................................................

of ....................................... as my proxy to attend and vote for me on my behalf at the 8th Annual General Meeting

of the Company to be held on Saturday, the 4th June, 2005 at 12.00 noon at 1 Shahbag C/A, Dhaka and at any adjournment

thereof.

As witness my hand this......................... day of June 2005 signed by the said in presence of...................................

.....................................................................................................................................................

........................................

(Signature of the Proxy)

Date:................................. ........................................

Signature of the Shareholder(s)

........................................ Register Folio No. :................

(Signature of Witness) Date:.................................

NOTE :A member entitled to attend and vote at the General Meeting may appoint a proxy to attend and vote in his/her stead.The proxy form, duly stamped, must be deposited at the Registered Office of the Company not later than 48 hours beforethe time appointed for the meeting.

Signature Verified

........................................Authorized Signatory

B A N G L A D E S H O N L I N E L I M I T E DRegistered Office : 17, Dhanmondi R/A, Road # 2, Dhaka-1205

SHAREHOLDER'S ATTENDANCE SLIP

I hereby record my attendance at the 8th Annual General Meeting being held on Saturday, the 4th June, 2005 at 12.00

noon at 1 Shahbag C/A, Dhaka.

Name of Member/Proxy ........................................................................................................................

Register BIO ID/Folio No.................................................................... holding of........................................

ordinary Shares of Bangladesh Online Limited.

........................................Signature of Shareholder(s)

N.B. 1. Please note that AGM can only be attended by the honorable shareholder or properly constituted proxy.Therefore, any friend or children accompanying with honorable shareholder or proxy cannot be allowed intothe meeting.

2. Please present this slip at the reception Desk.

hhRevenueStamp

Tk. 8.00

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