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Taiwan Stock Exchange Corporation Procedures for Press Conferences Concerning Material Information of Listed Companies(2003.04.16) |
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Article 1
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These Procedures are promulgated pursuant to Article 2 of the Securities Listing Contract signed between this Corporation and listed companies.
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Article 2
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"Material information" in "press conferences concerning material information" as used in these Procedures means the following particulars provided by a listed company of its own initiative or investigated and verified at the initiative of the Taiwan Stock Exchange:
1. Dishonor of a negotiable instrument due to insufficient deposits, refusal by a financial institution to honor a transaction, or other loss of credit of a listed company or parent company or subsidiary thereof.
2. Any serious effect on company finances or business resulting from any litigious or non-litigious matter, administrative disposition, or contentious administrative procedure.
3. Serious decrease in output or complete stoppage of work.
4. Any event set forth in Paragraph 1 of Article 185 of the Company Law.
5. Court ruling prohibiting transfer of the company's shares pursuant to Subparagraph 5 of Paragraph 1 of Article 287 of the Company Law.
6. Signing or rescission of an important memorandum of understanding or strategic alliance or plan for business cooperation with another company or important contract, or change to important content of a business plan, completion of development of a new product, or acquisition of another's enterprise.
7. Resolution by the board of directors for capital reduction, merger or consolidation, cancellation of merger or consolidation, spin-off, acquisition, acquisition of shares, dissolution, establishment of or conversion into a financial holding company or investment holding company or subsidiary thereof; or inability to convene a subsequent shareholders' meeting of a company participating in a merger, consolidation, spin-off, acquisition, or acquisition of shares, or veto of the proposal for merger, consolidation, spin-off, acquisition, or acquisition of shares. "Subsidiary means a subsidiary as defined in Article 4, Subparagraph 4 of the Financial Holding Company Law.
8. Failure to convene the regular shareholders' meeting within six months from the close of the fiscal year.
9. The degree of change in operating revenue anticipated in the disclosed corrected or updated financial forecast reviewed by a certified public accountant (CPA) exceeds 20 percent or the degree of change in operating profits (losses) or pre-tax profits (losses) anticipated therein exceeds 40 percent.
10. A change by resolution of the board of directors in a plan for capital increase by cash or offering of corporate bonds after such plan has become effective upon registration or been approved upon application, or such change in a plan for private placement of securities after recordation.
11. After a plan for capital increase by cash or offering of corporate bonds has become effective upon registration or approved upon application, failure to input to the Internet within 10 days from the close of each quarter the statement of fund utilization and the appraisal opinion of the original lead underwriter.
12. Transactions between the company and related parties: acquisition or disposal of long and short-term investments in securities, real property, and other fixed assets, where the monetary amount of the individual transaction, or of cumulative transactions with a same trading counterpart within one year, reaches 20 percent of the company's paid-in capital or not less than NT$300 million; acquisition or disposal of real property for operating use by construction enterprises, where the monetary amount of the individual transaction, or of cumulative transactions with a same trading counterpart within one year, reaches 20 percent of the company's paid-in capital or not less than NT$500 million.
13. Issuance of a CPA audit report containing other than an unqualified opinion on the annual or semi-annual financial report of a listed company. However, this shall not apply where due to application of adjusted accounting standards set forth in the Financial Accounting Standards Gazette or, for the semi-annual financial report, where due to recognition of long-term equity investments and gains or losses on investments accounted for under the equity method based on an investee company's financial statement that has not been audited and certified by a CPA.
14. Occurrence of a disaster, group protest, strike, environmental pollution event resulting in a disposition by a competent authority, where the anticipated insurance-indemnified loss exceeds 20 percent of the company's paid-in capital or NT$300 million or more.
15. Bankruptcy procedures under relevant laws and regulations or court filing for reorganization of a listed company or the parent or a subsidiary thereof.
16. Any significant effect from mass media reportage or information provided by investors.
17. Provisional injunction ruling suspending the exercise of authority of office of more than one-half (inclusive) of directors or supervisors of the company.
18. Where capital amendment registration has been carried out due to capital reduction, the effect of the capital reduction on the company financial report (including any discrepancy between the amount of paid-in capital and the number of shares outstanding and the effect on net worth per share) and planned share conversion operations, and any subsequent failure to execute such share conversion plan.
19. Voidance of the permit of a financial holding company by the competent authority thereof, or penalization of a financial holding company by the competent authority thereof because of a violation of any applicable provision of the Financial Holding Company Law, or loss by a financial holding company of controlling shareholding (as defined in Subparagraph 1 of Article 4 of the Financial Holding Company Law) in a subsidiary thereof, where the competent authority has ordered remediation within a certain time limit.
20. Resolution by the board of directors of a financial holding company in favor of a conversion of shares of a single or multiple company(ies) limited by shares to the financial holding company pursuant to Article 29 of the Financial Holding Company Law.
21. Shortfall in the number of held companies of an investment holding company relative to the standard set forth in Article 3 of this Corporation's Criteria for Review of Securities Listings by Investment Holding Companies.
22. Resolution by the board of directors or a shareholders' meeting of a listed company to apply for termination of listing for trading of its securities.
23. Forfeiture by the directors and supervisors as a whole of subscription rights to shares in a number reaching one-half or more of subscribable shares upon cash capital increase of a listed company, and opening of the shares for subscription by a specific person or persons through negotiation.
24. Any other circumstance with a material effect on shareholders' equity or securities prices, or other major policy resolutions of the board of directors of the company.
The existence of any circumstance set forth in any subparagraph of the preceding paragraph in respect of any held company or subsidiary of a listed company that is an investment holding company or financial holding company, or in respect of a listed company that is a subsidiary of a non-listed domestic parent company, shall be deemed material information of the listed company.
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Article 3
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A listed company to which any circumstance set forth in any subparagraph in the preceding article applies, or that discovers mass media reportage of any circumstance set forth in any subparagraph of the preceding article or any reportage that diverges from facts, shall complete a "Report to Convene a Press Conference Concerning Material Information" (Attachment 1) specifying the content of the information, and promptly send it to this Corporation for handling. Unless this Corporation deems there to be a necessity to postpone handling, the company shall promptly dispatch a spokesperson or acting spokesperson to a press conference before the trading day next following the occurrence of the event or the broadcast media report, to provide explanations to the news media.
Where, as set forth in Paragraph 1, Subparagraph 7 of the preceding article, there is a resolution by the board of directors of a listed company for merger or consolidation, cancellation of merger or consolidation, spin-off, acquisition, acquisition of shares, establishment of or conversion into a financial holding company or investment holding company or subsidiary thereof; or inability to convene a subsequent shareholders' meeting of a company participating in a merger or consolidation, spin-off, acquisition, or acquisition of shares; or veto by the shareholders' meeting of the proposal for merger or consolidation, spin-off, acquisition, or acquisition of shares; or there are the circumstance set forth in Subparagraph 20, the listed company shall convene a press conference at this Corporation after closing of the centralized securities exchange market. If there is more than one participating listed company, the companies shall hold the press conference simultaneously.
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Article 4
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When this Corporation discovers or mass media report the existence of any material information set forth in Article 2 with respect to a listed company, and such information is verified pursuant to this Corporation Procedures for Verification and Disclosure of Material Information of Listed Companies, this Corporation may complete a Notice for a Press Conference Concerning Material Information (Attachment 2) specifying the source and content of the information, and send it to the listed company to request that it dispatch a spokesperson or acting spokesperson to participate in a news conference by a deadline set by this Corporation, to provide explanations to the news media.
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Article 5
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To ensure timeliness, a listed company filling out a report pursuant to Article 2 shall first transmit it by facsimile and then deliver the original report. If after delivery of the original report any discrepancy with the originally facsimiled is discovered, the listed company shall bear the responsibility, and shall publicly announce and explain the discrepancy. A report submitted by a listed company shall be filled out consistently with the facts, and shall be chopped with the chops of the company and its responsible person or manager, to indicate that they take responsibility for it.
When convening a press conference, a representative of a listed company shall state in detail the facts that occurred, the cause, the effect on company finances, the projected monetary amount of such effects, and countermeasures to be taken, and shall prepare relevant written materials. The concrete content required to be explained shall be separately prescribed by this Corporation.
Where any of the circumstances set forth in Article 2, Paragraph 1 applies to a listed company, the company shall input the content of such event into the Internet information reporting system designated by this Corporation on the date of occurrence of the event or the same day as the media reportage, except in the cases of a resolution by the board of directors of a listed company for merger or consolidation, cancellation of merger or consolidation, spin-off, acquisition, acquisition of shares, establishment of or conversion into a financial holding company or investment holding company or subsidiary thereof; or inability to convene a subsequent shareholders' meeting of a company participating in a merger or consolidation spin-off, acquisition, or acquisition of shares; or veto by the shareholders' meeting of the proposal for merger or consolidation spin-off, acquisition, or acquisition of shares; or the circumstances set forth in Subparagraph 20, in which cases the listed company shall, at the time of convening the press conference or after the conference, input into the Internet information reporting system designated by this Company the information about the event as required under this Corporation's Procedures for Verification and Disclosure of Material Information of Listed Companies.
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Article 6
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To ensure the accuracy of and general access to relevant information, a listed company shall not privately announce any information prior to inputting the content of an event into the Internet information reporting system designated by this Corporation or holding a press conference concerning material information pursuant to these Procedures.
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Article 7
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This Corporation may impose a breach penalty of NT$50,000 on a listed company that violates any provision of these Procedures for each individual case of violation; provided, however, that if the cumulative number of penalties within one year reaches two or more (inclusive of the current penalty), a breach penalty of NT$100,000 shall be imposed as the current penalty. Where a listed company that is required to make up some measure, and that is notified to do so by before the trading day next following the notice, still fails to do so by the deadline, a breach penalty of NT$10,000 per day may be imposed until the day the measure is carried out.
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Article 8
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By the tenth day of each month, this Corporation shall publicly announce at the centralized securities exchange market the status of penalties imposed on listed companies that violated these Procedures the preceding month.
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Article 9
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These Procedures shall take force after ratification by the competent authority; the same shall apply to any amendments hereto.
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