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A listed company under rehabilitation can opt to seek funding by obtaining approval to offer securities for sale in accordance with its rehabilitation plan approved by the Bankruptcy Court.
On 2 April 2024, the Thai Securities and Exchange Commission (“SEC”) announced a series of five notifications, effective as of 16 April 2024, in order to facilitate it in granting approval for the offering of newly issued securities, i.e. shares, debentures and warrants to purchase shares, by a listed company that is under business rehabilitation (“Listed Company under Rehabilitation”), in accordance with the company’s rehabilitation plan approved by the Thai Bankruptcy Court (“Court”).
The Listed Company under Rehabilitation will be granted approval by the SEC to offer newly issued securities and underlying shares for sale only if such offering is made in accordance with its rehabilitation plan and all criteria are met. In such regard, the Listed Company under Rehabilitation’s rehabilitation plan approved by the Court shall include a clear plan for the offering of newly issued securities and underlying shares, including at least: information in respect of the number and type of securities being offered; the characteristics or type of investor to whom the securities will be offered; and the offering period of the newly issued securities and underlying shares (Clause 10 of the Notification of the Capital Market Supervisory Board No. Tor Jor. 9/2567 Re: Issuance and Offering for Sale of Securities of Listed Company under Rehabilitation Plan, dated 2 April 2024).
Prior to each offering of securities, the Listed Company under Rehabilitation shall disclose material information, including information of its rehabilitation plan and any associated risk, and submit such to the SEC along with the Registration Statement and Draft Prospectus (Form 69-1) (“the Filing”). The cooling off period is 14 days from the date on which the SEC received the Filing (Clause 20 of Tor Jor. 9/2567). The Filing fee is waived (Notification of the Office of the Securities and Exchange Commission No. Sor Mor. 7/2567 Re: Determination of Fees on Filing of the Registration Statement, Registration and Other Applications (No. 69), dated 2 April 2024).
The financial advisor who assists in preparing the Filing must not be a director or plan administrator of the Listed Company under Rehabilitation; in order to restrict any conflict of interest (Notification of the Office of the Securities and Exchange Commission No. Sor Shor. 8/2567 Re: Approval of Financial Advisor and Scope of Duties (No. 13), dated 2 April 2024).
The Listed Company under Rehabilitation that is granted approval to offer newly issued securities in accordance with its rehabilitation plan shall submit both quarterly and yearly financial reports to the SEC. Moreover, as long as the Listed Company under Rehabilitation is obligated or bound to perform according to its rehabilitation plan, it shall disclose its financial status, operating result, information of rehabilitation plan, and the status and progress of rehabilitation under the rehabilitation plan in its annual registration statement (Form 56-1 One Report) (Clause 21 of Tor Jor. 9/2567).
This is intended merely to provide a regulatory overview and not to be comprehensive, nor to provide legal advice. Should you have any questions on this or on other areas of law, please do not hesitate to contact:
Nuttaros Tangprasitti
Partner
Malinee Kriengkrailipikorn
Counsel
Authors
Malinee currently focuses her practice on commercial contract drafting and the provision of expert advice to clients on various corporate and commercial issues. In recent times, Malinee assisted Nok Airlines Public Company Limited (“Nok Airlines”), one of the leading airlines in Thailand in business rehabilitation proceedings to solve the impact of the Covid-19 pandemic crisis. The work includes non-court proceedings, such as advice on the evaluation of obligations under the contracts and laws relating to the Air Aviation business for the client to use in their preparation of appropriate strategies for the business rehabilitation plan and their explanation and negotiation with the creditors, and legal advice during the implementation of the rehabilitation plan.
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Nuttaros Tangprasitti specialises in corporate and commercial law. She regularly assists both international and domestic corporate clients (limited liability companies and partnerships, stock corporation in several industries) on the relevant laws of Thailand, which includes foreign direct investment, legal due diligence, M&A and cross-border M&A, joint venture, compliance, banking and finance. In addition to supporting clients on the above and a multitude of different legal formalities, she also has expertise in advising on various investment promotion policies of the Board of Investment (BOI), as well as compliance with foreign business, other laws on salient points for shareholders and joint venture agreements, which includes laws on immigration and foreign work under Thai law. Nuttaros speaks at many seminars and takes an active role in educating the clients on issues relevant to their businesses and her practice areas. She also writes various articles and newsletters on cutting-edge topics in several legal areas, which are widely distributed to existing and potential clients. Nuttaros aims to ensure the lawyers on her team are constantly developing and upgrading their skills, to ensure they meet or exceed the high professional standards of Nishimura & Asahi. She is committed to ensuring that both she and our firm deliver top-quality services to our clients and strong internal support for our colleagues. She recently began drafting a manual on several aspects of Thai law, as part of an “Investment promotion scheme,” and also wrote several newsletters on corporate law, and banking and finance laws. She also recently authored an article on the impact of Tax Reduction for Land and Buildings, which received excellent feedback from our clients, particularly those who are land and building owners. Nuttaros is committed to building a strong and progressive corporate and commercial practice, which also incorporates tax law, by adapting to new ideas in the legal industry.