Office of Securities and Exchange Commission (“SEC Office”) has a public hearing on draft of notifications related to securities offering of the listed company in accordance with reorganization plan

The SEC Office opened the public hearing on the Principle and Drafts of the SEC Office’s Notifications Related to Securities Offering of the Listed Company under the Reorganization Plan Approved by the Court under Bankruptcy Law (“Company”) (collectively called “Drafts”) from 24 January 2024 to 22 February 2024. 

At present, there is more creativity than ever regarding how the Company can be reorganized by using securities offerings. So, to match the variety of reorganization and facilitation of the process, the SEC Office comes up with an alternative financing option for the Company in addition to the existing way of financing.

In brief, the core concept sets out that if the Company conforms with the disclosure rules in accordance with the regulations of the SEC Office, the Company may offer securities as per the reorganization plan. The benefits of this process are, for example, that there are fewer steps required to do securities offering and that the Company shall receive a fee exemption.

Moreover, these rules do not compromise investor protection because, still, a disclosure of material information must be made and there must be a qualified financial advisor in making a registration statement and a draft prospectus as well.