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4 April 2011

Thailand Civil and Commercial Code
Chapter IV
Limited Companies Law Code
Part I
Nature and Formation of Limited Companies

Section 1096. A limited company is that type of which is formed with Capital divided into shares, and the liability of the shareholders is limited by the amount, if any, unpaid on those shares respectively held by each shareholder.

Section 1096 bis. (Repealed)

Section 1097. Any seven or more persons may, by subscribing their names to a memorandum and otherwise complying with the provisions of this Code, promote and form a limited company.

Section 1098. The memorandum shall contain the following details:

(1) The name of the proposed company, which must always end with the word “limited”.
(2) The part of the Kingdom in which the registered office of the company shall be located.
(3) The objects of the company.
(4) A declaration that the liability of the shareholders shall be limited
(5) The amount of share capital with which the company proposes to be registered, and the divisions thereof into shares of a fixed amount.
(6) The names, addresses, occupations and signatures of the promoters, and the number of shares subscribed to each of them.
Section 1099. The memorandum must be made in two original copies at least and signed by the promoters, and the signatures should be certified by two witnesses.

One of the copies of the memorandum must be deposited and registered at the Registration Office of that part of the Kingdom in which the registered office of the company is deemed to be situated.
Section 1100. Every promoter must subscribe at least one share.
The liability of the directors of a limited company may be unlimited.
In such case, a statement to that effect must be provided in the memorandum.
The unlimited liability of a director terminates at the expiration of two years after the date at which he stopped holding office.
Section 1102. No invitation to subscribe for shares should be made to the public.

Section 1103. (Repealed)

Section 1104. The whole number of shares with which the company proposes to be registered must be subscribed or allotted prior to registration of the company.

Section 1105. Shares may not be issued at a lesser price than their nominal amount.

The issue of shares at a higher price than their nominal amount is allowed, if stated by the memorandum. In such case the excess amount must be paid along with the first payment.
The first payment on the shares must not be less than twenty-five per cent of their nominal amount.
Section 1106. A person binds himself when subscribing for shares, on condition that the company be formed, and to pay the company the amount of such shares in alignment with the prospectus and regulations.

Section 1107. When all the shares to be paid in money have been subscribed, the promoters must without delay hold a general meeting of subscribers which should be called the statutory meeting.

The promoters shall, at least seven days before the day on which the meeting is to be held, forward to every subscriber a statutory report, duly certified by them, outlining the details of the business to be transacted at the statutory meeting under the following section.
The promoters shall ensure that a copy of the statutory report, certified as by this section required, is filed with the Registrar of companies forthwith after sending thereof to the subscribers.
The promoters shall also ensure that a list showing the names, descriptions and addresses of the subscribers, and the number of shares subscribed by them respectively, is produced at the meeting.
The provisions of Section 1176, 1187, 1188, 1189, 1191, 1192 and 1195 shall apply mutatis mutandis to the statutory meeting.

Section 1108. The business to be transacted at the statutory meeting:

(1) The adoption of the regulations of the company, if any.
(2) The ratification of any contracts signed into and any expenses incurred by the promoters in promoting the company.
(3) The fixing of the amount, if any, to be paid to the promoters.
(4) The fixing of the number of preference shares, if any, to be issued, and the nature and breadth of the preferential rights accruing to them.
(5) The fixing of the number of ordinary shares or preference shares to be allotted as fully or partly paid-up otherwise than in money, if any, and the amount up to which they shall be considered as paid-up.
The description of the service or property in return for which such ordinary shares or preference shares shall be allotted as paid-up shall be expressly decided upon before the meeting.
(6) The appointment of the first directors and auditors and the fixing of their respective powers.

Section 1109. A promoter or a subscriber who has a special interest in a resolution cannot exercise the right of voting.

No resolutions of the statutory meeting are valid unless passed by a majority including at least one half of the total number of subscribers allowed to vote, and representing at least one half of the total number of shares of such subscribers.

Section 1110. After the statutory meeting is held, the promoters shall turn over the business to the directors.
The directors will then cause the promoters and subscribers to pay forthwith upon each share payable in money such amount, not less than twenty-five per cent, as detailed by the prospectus, notice, advertisement or invitation.

Section 1111. When the amount mentioned in Section 1110 has been paid, the directors must apply for the registration of the company.

The application and entry in the register shall contain, in conformity with the decisions of the statutory meeting, the following details:
(1) The total number of shares subscribed or allotted, distinguishing ordinary shares and preference shares.
(2) The number of ordinary shares or preference shares allotted as fully or partly paid-up otherwise than in money, and in the latter case, the amount to which they are so paid up.
(3) The amount already paid in money on each share.
(4) The total amount of money received in respect of shares.
(5) The names, occupations and addresses of the directors.
(6) If the directors have power to act separately, their respective powers and the number or names of the directors whose signature is binding on the company.
(7) The period, if any has been fixed, for which the company is formed.
(8) The address of the main business office and of all branch offices.

The entry may contain any other details which the directors may deem expedient to make known to the public.

The application must be accompanied by the copy of the regulations, if any, and of the proceedings of the statutory meeting, both certified by the signature of at least one director.

The directors must concurrently deposit with the Registration Office ten printed copies of the memorandum and of the regulations, if any, of the company.

A certificate of registration shall be delivered to the company.

Section 1112. If registration does not take place within three months of the statutory meeting, the company is not formed, and all the money received from the applicants must be paid back without deduction.

If any such money has not been paid back within three months after the statutory meeting, the directors of the company are jointly liable to repay that money with interest from the expiration date of the three months deadline.

A director shall not be liable for repayment of interest if he demonstrates factually that the loss of money or delay was not due to his fault.

Section 1113. The promoters of the company are jointly and unlimitedly liable for all obligations and disbursement not approved by the statutory meeting; even if approved they remain so liable until the registration of the company.

Section 1114. After a company is registered, a subscriber of shares cannot file a claim for cancellation by the Court of his subscription on grounds of a mistake, duress or fraud.

Section 1115. If the name provided in a memorandum is identical to the name of an existing registered company or with the name provided in a registered memorandum, or so nearly resembling the same as to be likely to deceive the public, any interested person can file a claim for compensation against the promoters of the company and can ask for an order from the Court that the name be altered.

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