Equity Instruments

​Shares

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Private Placement (PP) of shares and warrant – in case of a listed company

Criteria for approval: can be divided into four cases, depending on the nature of share price indication based on the resolution of the shareholders' meeting.

1^st case: assign the board of directors to indicate the offering price in accordance with the market price at the time of offer

2^nd case: the shareholders resolved to clearly indicate the offering price

3^rd case: the offer to sell shares remaining from Rights offering

4^th case: the offer to sell PP shares which is not falling under 1st to 3rd cases​

1^st case: assign the board of directors to indicate the offering price in accordance with the market price at the time of offer
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2^nd case: the shareholders decided to clearly indicate the offering price

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3^rd case: the share/ warrant offering in a Private Placement 

4^th case: the offer to sell PP shares which is not falling under 1st to 3rd cases 

Conditions for approval

1. ​​A listed company is prohibited from advertising the offer to sell new shares to the public.

2. A listed company must use proceeds from the approved offering of shares in accordance with the objectives of the capital increase indicated in the notice calling shareholders' meeting.

3. A listed company must disclose information about the newly issued shares to PP before the offer to sell, with the details of at least the offering price and the method of calculating the offering price via the system to disclose information as specified by the SET.

4. A listed company is prohibited from offering shares to a subsidiary.

5. If the persons being allocated shares are related persons, the listed company mu​st act pursuant to the criteria of related party transactions.
   
   

Additional requirements for warrant – PP

• Approval for warrant – PP must be registered with transfer restrictions.

• In case of an offer to sell warrant – PP which the board of directors is aware of the names of investors and the shareholders resolved to indicate the sale price for underlying shares for warrant – PP, investment agreements must be included in the warrant – PP by specifying transfer restrictions for such warrant – PP.
  
  

Disclosure of information

The SEC specifies that issuers in a Public Offering must disclose information to investors, and a good disclosure of information should be free flow, namely, investors should have equal access to information. Information must be accurate, reliable, adequate and timely. In addition, information should be both financial and non-financial which reflects the strengths and weaknesses of the company in order for the shareholders to have complete information in making a decision and have control over the executives in risk management, financial management and business strategy.  The securities issuing company must disclose the minimum requirements in a format and within the specified period, and the following information is required:

• Application for the offer for sale of shares (form 69-1)

• Prospectus

After offering to sell shares, the company has duty to disclose information in:

• Annual Registration Statements (form 56-1) and

• Annual report (form 56-2)

Important information that must be disclose are, such as,

• Risk factors

• Type of operation

• Capital structure

• Management structure

• Related transaction

• Evaluation report of the internal control system by Internal Auditor (IA)

• Management Discussion & Analysis (MD&A)

• Events and factors substantially affecting the operation or financial status of the company in the future (forward looking)
  
  

Risk factors

Important points

• What risk does the company have?

• If the risk occurs, how much it will affect invested capital?

Disclosed information

• Detailed explanation concerning particular risk on the company

• Chance of risk occurring

• Effects on the company if the risk occurs
  
  

Type of operation

Important points

• What kind of business does the company, subsidiary, associate company do? Is it a product or a service? From which business is the major income derived?

• How is the trend of the industry? Can the company compete with other business competitors?

• Are there any restrictions in the company's operation?

Disclosed information

• Business structure / product or service / income

• Condition of the industry and competition

• Research and development
  
  

Capital structure

Important points

• Who are the majority shareholders that can control the votes?

• Is there a check and balance among the majority shareholders?

• Are there other securities that may cause dilution effect?

• What is the policy for payment of dividends?

Disclosed information

• The type of securities being issued and still available, for instance, common shares, preferred shares, debentures or convertible securities, as well as important conditions of securities

• Shareholding structure (the first 10)

• Shareholder agreements

• Policy for payment of dividends (both the company and subsidiary)
  
  

Management structure

Important points

• Who are the directors or executives? What is the scope of their powers?

• Who are the independent directors / Audit Committee (AC) to act for the interests of individual investors?

• What is the corporate governance and internal control system?

Disclosed information

• Board of directors and executives:

• Each committee (name, scope of powers)

• AC with the experience in auditing financial statements

• Name and title of executives / company's secretary

• Selection of directors and executives

• Remunerations

• Corporate governance (CG) / control of usage of internal information

• The total number of staff, number of staff in the main fields, accumulated remuneration, labour disputes (if any)

• Anti-corruption

• Corporate Social Responsibility (CSR)​
  
  

Related party transaction

Important points

• Does the company have related party transactions?

• How are the transactions transparent, equitable, reasonable and beneficial to the shareholders?

Disclosed information

• Last period transactions:

• Names of related party and their relations

• The type and amount of transaction

• Whether it is a market price or a fair price

• Whether the conditions are in accordance with ordinary business

• Necessity and reasonableness / opinion of the Audit Committee

• Policy or trend of future transactions
  
  

Management Discussion & Analysis (MD&A)

Important points

• Reasons for the status and business performance, important events that affect the financial statements

• Analytical comparison with the company's past and with other companies in the same industry

• Obligations or factors which may affect the company

Disclosed information

• Summary of financial information with a three year comparison

• Analytical explanation of:

• Financial status (assets, liquidity, capital expenditure, sources of capital (debt / equity))

• Performance (income and equity of business, expenditure, revenue or special expense, financial cost, the rates of gross profit and net profit)

• Important financial ratios

• Factors which may affect the financial status and performance
  
  

Events and factors substantially affecting the operation or financial status of the company in the future (forward looking)

Important points

• What is the information that can help predict future performance?

Disclosed information

There is certainty that it will happen in the future and affect the performance, such as:

• Events, obligations or contracts already concluded and has effect on financial statements being due

• Income which may not occur again in the future