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Article 282
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Where a company which publicly issues shares or corporate bonds suspends its business due to financial difficulty or there is an apprehension of suspension of business thereof, but there is a possibility for the company to be constructed or rehabilitated, the company or any of the following interested parties may apply to the court for reorganization:
- Shareholders who have been continuously holding shares representing ten per cent or more of the total number of issued shares for a period of six months or longer;
- Creditors of the company who have claims equivalent to ten per cent or more of the capital from the total number of issued shares;
- Labor unions; or
- Two-third or more of the Employees of a company.
For filing the reorganization application by a company under the preceding Paragraph, the Board of Directors of the company shall adopt a resolution by a majority vote of the directors present at a meeting of the Board of Directors attended by over two-thirds of all directors.
The labor unions referred to in Item Three, Paragraph One denote the following labor unions:
- Corporate union;
- The industrial union whose members are joined by more than one half of employees employed by the company.
- The professional union whose members are joined by more than one half of employees with the same professional skills employed by the company.
The employees referred to in Item Four, Paragraph One shall be calculated based on the employee number of the roster of labor insurance of the company at the date of applying for reorganization.
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Article 285-1
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Based on the report made by the inspector and by making reference to the opinions provided by the central authority in charge of the end enterprise concerned, the authority in charge of securities affairs, the central authority in charge of financial affairs, and other relevant authorities and organizations, the court shall, within 120 days after its receipt of a reorganization application filed by a company, render a ruling to approve or to dismiss the said re-organization application and shall notify all authorities concerned of such ruling accordingly.
The 120-day reviewing period fixed in the preceding Paragraph may be extended by a ruling to be made by the court for an additional 30 days provided that no more than two extensions may be made.
Under either of the following circumstances, the court may dismiss a company re-organization application:
- Where any statement or information contained in the written application documents is found false or untrue; or
- Where reconstruction and/or rehabilitation as proposed by the applicant is deemed unfeasible after considering the business and financial conditions of the company.
When dismissing a company reorganization application by a ruling to be rendered in accordance with the provisions set out in the preceding Paragraph, the court may, ex officio, make a bankruptcy pronouncement, if the conditions for bankruptcy are met.
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Article 287
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Prior to rendition of a ruling for reorganization of a company, the court may, at the request of the company or an interested party or ex officio, render a ruling for the following disposal:
- Disposal for preservation of the company's property;
- Restriction on the business of the company;
- Restriction on performance of obligation of the company and exercise of claim against the company;
- Suspension of proceedings for bankruptcy, com- position, or compulsory execution and others;
- Prohibition of transfer of registered share certificates; and
- Assessment of the liabilities of responsible persons of the company to compensate the company for loss or damage and preservation of their property.
The term of validity of the ruling to be made under the preceding Paragraph shall not exceed 90 days, unless otherwise fixed by the court; and may be extended when necessary by the court at the request of the company or an interest party provided that the duration of each extension shall not exceed 90 days.
In case the ruling for dismissing a company reorganization application becomes final prior to the expiry of the term of validity referred to in the preceding Paragraph, then the ruling rendered under Paragraph I under this Article shall become null and void.
In rendering a ruling under the provisions of Paragraph I of this Article, the court shall inform, by a notice, the authority in charge of securities affairs and the central authority in charge of the relevant end enterprise.
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