Company Name Selection

REGISTRATION AND COMPANY NAME SELECTION - The wholes process for incorporation of a limited company will take approximately 14 days depending on co-operation of the client. First of all, we are required to reserve the corporate name with the registrar, the corporate name shall not be identical or similar to those already used or reserved by other corporations. You must provide 3 choices in order of preference to avoid delays .

A MEMORANDUM OF ASSOCIATION - Must be filed with the Commercial Registration Department. This has to include the name of the company that has been successfully reserved, its business objectives, the capital to be registered, the province where the company will be located, and the names of the seven promoters. The capital information must include the number of shares and the value per share.

DRAFTING OF BUSINESS OBJECTIVES/ARTICLES OF INCORPORATION

Corporate Objectives can be defined as 'the goal aimed at'.

All companies have 2 basic objectives - an outward-looking marketing objective concerned with customers, and an inward-looking objective concerned with developing products and services to satisfy customers. The marketing objective aims to understand customer needs. The innovation objective aims at providing the market with products and services that are more attractive than those of competitors. Companies strive to differentiate their products and services from those of competitors through marketing and innovation.

The highest-level objectives that are set for a company are often referred to as the business goals. They are usually derived from the company mission.

The Articles of Association details how a company will be managed and lays out the relationship between shareholders and directors. This is the second important document which is to be filed with the Ministry of Commerce. The Articles of Association must be in good order for there to be effective control by a particular group of shareholders. The Articles may provide for the division of shares of a company into one or more classes (ordinary and preference shares) may be done, with each class having specific rights. There are a number of ways to structure different classes of shares and apportion rights to each class.

FORMATION OF SHAREHOLDER STRUCTURE AND COORDINATION OF THAI SHAREHOLDERS

SHAREHOLDERS AND SHARES - A private limited company requires at all times to have at least 7 shareholders; A minimum of 5 of them shall be Thai nationals and hold at least 51 percent of total shares in aggregate . A maximum of 3 Foreigners are allowed up to 49 percent of the shareholding. However, for foreigners to control the company the Thai shareholders sign blank share transfer agreements which are handed over to you (the minority shareholder/s), so the Thai shareholders are in fact no longer shareholders in the company. By using this method you will then have total control of the Thai company . Also ordinary and preference shares may be allocated giving differing voting rights which is another way of having foreign control.

SHARE CERTIFICATES - A share certificate signed on behalf of the corporation evidencing the fact that the person therein named is the recorded owner of the shares therein described.

FOREIGN DIRECTOR REGISTRATION - Only a natural person, jui suris , can be appointed as a director. Director is not required to be a shareholder of the company. A foreigner can be a director of the company and the board of Directors may consist of a majority of foreigners. However, if such foreign director desires to work full time for the company or to be an authorized director, a work permit is required. The company has to nominate an authorized director(s) whom are empowered to sign company documents, which bind upon the company and are registered with the Ministry of Commerce. A standard term generally registered in specifying the authorized director(s) is "any director signs" together with the company's seal affixed.

SELECTION OF INITIAL CAPITALIZATION LEVEL - Pursuant to Thai laws, the minimum capital of a company is Baht 35 and there is no provision on the maximum capitalization. Thai laws state that all the shares of the company must be subscribed, issued and paid in full. Nonetheless, the laws allow the Shareholders to initially make payment of not less than 25 percent of the share value.

However, if the company would employ an expatriate, it will be required by the Foreigner Act, to have a registered capital of not less than Baht Two Million for every expatriate to be employed and the registered capital must be fully paid up. This is a prerequisite for the company to be entitled to file an application for work permit for the expatriate.