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Taiwan Stock Exchange Corporation Procedures for Verification and Disclosure of Material Information of Real Estate Securitization Trustee Institutions(2004.02.04) |
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Article 1
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These Procedures are adopted pursuant to Article 2 of the Listing Contract for REIT and REAT Beneficial Interest Securities, which is executed between the Taiwan Stock Exchange Corporation (TSEC) and real estate securitization trustee institutions.
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Article 2
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In these Procedures, "material information of a trustee institution" means the matters listed below:
1. A trustee institution has used trust assets to borrow funds or enter into a loan contract.
2. The creditor of the loan agreement in the preceding subparagraph is an insider of the trustee institution as set forth in Article 22-2 of the Securities and Exchange Act; is a blood relative of such insider within the second degree of kinship; or is a juristic person (or another juristic person controlled by the same party, or a juristic person with which the juristic person has a relationship of mutual control) where the creditor acts as a responsible person.
3. A trustee institution has used trust assets to borrow funds and, within the scope of such borrowed funds, has created a real estate mortgage upon, or other security interest in, the trust assets.
4. A trustee institution has utilized a REIT fund to execute a real estate or real estate-related rights transaction reaching or exceeding a certain amount prescribed by the competent authority of the relevant industry pursuant to Article 22, paragraph 1 of the Real Estate Securitization Act.
5. Principal content of a trust asset assessment reported to the board of directors by the trust asset assessment committee established by a trustee institution.
6. The net asset value per unit of beneficial interest in a REIT fund on the previous business day.
7. The difference between the appraised value and book value of trust assets is 10 percent or higher, or NT$100 million or more, and the trustee institution is required to make an adjusting entry to reflect that difference.
8. A new trustee institution has taken assignment of trust business or trust assets that the competent authority of the relevant industry, acting pursuant to Article 55 of the Real Estate Securitization Act, has ordered the original trustee institution to transfer.
9. A trustee institution has terminated a mandate contract agreement with a real estate management institution.
10. A trust institution has not distributed trust interest in accordance with a REIT contract or REAT contract.
11. There is a likelihood that the conduct of a trustee institution has damaged trust assets and a trust supervisor has requested that said conduct cease.
12. A trustee institution has been sanctioned by the competent authority of the relevant industry under the Real Estate Securitization Act due to violation thereof.
13. A trustee institution has had a negotiable instrument dishonored due to insufficient funds, been blacklisted by a financial institution, or has otherwise experienced a loss of creditworthiness.
14. A litigious or non-litigious matter, administrative disposition, or administrative litigation has had a material influence on the trustee institution's financial or business affairs.
15. A situation under any of the subparagraphs under Article 185, paragraph 1 of the Company Act exists at a trustee institution.
16. There is a change of a trustee institution's chairman (or chief trustee), general manager (or president), or one-third or more of its directors (or trustees).
17. A trustee institution has entered into an important contract or changed material content in its business plan.
18. Trust assets are insufficient to pay expenses incurred in the handling of trust affairs.
19. There has been a change to a REIT plan or REAT plan that was submitted to the competent authority of the relevant industry and subsequently granted either prior approval or effective registration.
20. A REIT or REAT contract has been changed, rescinded, or terminated.
21. A trustee institution has resigned or been dismissed; or there has been an appointment of, or a petition to select, a new trustee institution.
22. A trust supervisor has been switched.
23. A decision has been made regarding the date of a beneficiaries meeting, the dates of a book closure period for the register of beneficiaries, or the date of record for a distribution of income.
24. Major resolutions of a beneficiaries meeting.
25. Any one of the situations set out in Article 6, paragraph 1, subparagraphs 1 through 3 of the "Regulations Governing the Public Offering or Private Placement of REIT and REAT Beneficial Interest Securities by a Trustee" arises at a trustee institution. (Where a trustee institution, acting pursuant to subparagraph 4 of the same article and paragraph, has notified a holder of beneficial interest securities as referred to in the preceding three subparagraphs to transfer beneficial interest securities within one month, the holder's response to the notification also qualifies as material information.)
26. Other circumstances having a material effect on beneficiary rights and interests or the price of beneficial interest securities.
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Article 3
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If a situation set out in any of the subparagraphs of the preceding article arises, the trustee institution shall input the information into the TSEC-designated Internet reporting system prior to the beginning of trading hours on the first business day following either the date of occurrence or the date on which it is reported upon in the mass media, provided that where it issues a news release prior to that time, the trustee institution shall input the information at the same time. Where a trustee institution discovers that there has been a mass media report regarding a situation set forth in any of the subparagraphs of the preceding article, or that matters reported are factually inaccurate, it shall input an explanation regarding that information into the TSEC-designated Internet reporting system prior to the first business day after the day on which the media report is published.
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Article 4
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If the TSEC discovers, either on its own or from information faxed by an investor (Attachment 1) making an inquiry with the TSEC, that a trustee institution has failed to report material information set out in Article 2, the TSEC may, as it deems necessary, fill out an "Order for Disclosure by Trustee Institution of Material Information, Form 1" (Attachment 2), furnishing the source and content of the information, and query that trustee institution's spokesperson or deputy spokesperson by facsimile or telephone. The trustee institution shall input the relevant explanation regarding the inquiry into the TSEC-designated Internet reporting system prior to the deadline set by the TSEC.
"Prior to the deadline set by the TSEC" in the preceding paragraph means if the trustee institution receives a TSEC inquiry by facsimile or telephone before 12:30 p.m. on a given business day, it shall input the explanation into the TSEC-designated Internet reporting system prior to market close; if the trustee institution receives the TSEC's inquiry by facsimile or telephone after 12:30 p.m. on a given business day, it shall input the required explanation into the TSEC-designated Internet reporting system prior to 5 p.m. on the same day.
The written investor inquiry of the first paragraph shall be filled out with the investor's true name, national ID number, address, and contact telephone number. The TSEC may use either the original document or a summary thereof in directing inquiries to the trustee institution during normal business hours.
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Article 5
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To ensure the accuracy and universal availability of information, a trustee institution may not privately announce any information prior to an announcement of material information.
Material information reported by a trustee institution shall state in detail what has occurred and why. It shall further estimate the impact thereof, and indicate the measures to be taken in response.
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Article 6
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If a trustee institution is unable for any other reason to input material information into the TSEC-designated Internet reporting system and instead uses an "Order for Disclosure by Trustee Institution of Material Information, Form 2" (Attachment 3) to report material information, the TSEC may publicly announce such material information in accordance with applicable requirements or disclose it through the TSEC information transmission system. The TSEC may also transmit photocopies of the aforesaid form to securities brokers for public posting at their place of business, and display it at the TSEC Public Relations Office for reference by the investing public.
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Article 7
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Where a trustee institution violates these Procedures, the TSEC may, as the situation merits, impose a penalty of NT$30,000.
Where a penalty is imposed, the trustee institution shall remit payment to the TSEC Finance Department within five days after the date on which it receives notification thereof.
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Article 8
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These Procedures, and any amendments hereto, shall be implemented after approval and/or recordation by the competent authority.
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