|
Article 3
|
On the front cover of the prospectus, the common stock code shall be printed in the upper right hand corner, and the following particulars shall be printed in sequential order:
1. The name and seal of the company or preparatory office.
2. The purpose of preparing this prospectus is for the issuance of the following securities:
(1) Issuance of New Shares: the source of this new issue, types of new shares, number of shares, value, conditions of the issue, the public underwriting ratio, and manner of underwriting and sale allocation. If there are specially agreed conditions for preferred shares, the referenced page number shall be separately noted.
(2) Issuance of Corporate Bonds: types, value, interest rate, conditions of issue, the public underwriting ratio, and manner of underwriting and sales allocation. If there are conversion or subscription features, the referenced page number shall be separately noted.
(3) Establishment by Public Offering: authorized capital amount, source of the current issue of new shares, types of new shares, number of shares, value, conditions of issue and the number of shares subscribed by the promoters.
(4) Other.
3. Summary of the purpose of the capital application plan and the projected possible effect thus created. Referenced page numbers shall also be noted.
4. The following statements shall be printed in a conspicuous manner:
(1) The effective registration (approval) of the securities may not be used to advertise the verification of the registration (application) items or the guarantee of the value of the securities.
(2) If this prospectus contains false or omitted information, the issuer and its responsible person and all other persons who sign or affix their seal on the prospectus shall be held liable in accordance with laws.
(3) The web addresses for enquiry about the prospectus, including the address of the information reporting website designated by the Securities and Futures Commission, Ministry of Finance (“SFC”) and the web address used by the company to disclose information relating to the prospectus.
5. Publication date.
Where there is a change in the common stock code referred to in the preceding paragraph, in the fiscal year that such change occurs and for the two consecutive fiscal years thereafter, the original stock code shall be printed in addition to the new stock code.
Where there is a change in the company name referred to in the preceding paragraph, in the fiscal year that such change occurs and for the two consecutive fiscal years thereafter, the change shall be disclosed by printing the new and old names adjacently.
The prospectus prepared for the registration (application) for public offer and/or issue of securities shall note in its front cover that it is a draft version for such registration (application) purpose.
If stabilization operations are proposed in connection with cash capital increase in accordance with the relevant regulations, the following statement shall also be noted in the prospectus' front cover in a conspicuous type print: "To deal with price fluctuations in the stock market, the underwriter may proceed with stabilization operations regarding the issued shares of the current right issue if necessary."
Where an issuer is reporting (applying for) an issue of shares at below par value, it shall also note in a prominent font on the prospectus cover that the company is issuing the new shares at a discount.
Where new shares are issued upon merger or acquisition (including merger or consolidation, acquisition, or split) or acquisition of another company's shares, if there are any restrictions on transfer or pledge of the issued shares, such restrictions shall be noted in a prominent font on the cover of the prospectus. For cases of establishment by offering and of public offerings by companies whose shares are neither listed on the stock exchange (hereinafter, are "unlisted") nor traded on the over-the-counter (OTC) market, the following statement shall also be noted on the prospectus' front cover in a prominent font: "The shares are neither listed on the stock exchange nor traded on the OTC market."
|
|
Article 6
|
The content of a prospectus, unless otherwise regulated by Chapter III on the simplified prospectus or Chapter IV on the prospectus for establishment by offering, shall include the following items:
1. Company Summary: Including brief description of the company, company organization, capital and shares, status of issue of corporate bonds, preferred shares, overseas depositary receipts, employee stock option certificates, and mergers and acquisitions and assignments of shares of other companies.
2. Operation Summary: Including the operation of the company, fixed assets and other real properties, re-invested business, important contracts and any other items required to be described or supplemented.
3. Issuance plan and implementation status: Including analysis of the fund application plan for the previous cash capital increase, merger or acquisition, assignment of another company's shares, or issue of corporate bonds; analysis of the fund application plan for the current cash capital increase or issue of corporate bonds; and status of the current issue of new shares due to assignment of another company's shares, or current issue of new shares due to merger or acquisition.
4. Financial Summary: Including the summarized financial data for the most recent 5 years, financial statements, and other important matters and information relating to financial status.
5. Review and analysis of financial condition and operating results, and an overview of the company's risk management.
6. Special Items to be Included.
7. Important Resolutions, Articles of Incorporation and Relevant Laws and Regulations.
If the SFC has promulgated separate rules/regulations for special industries like banks, bill financing, securities, futures, insurance, financial holdings, and trust & investment, those rules/regulations shall be complied with.
|
|
Article 9
|
The "company organization" shall include the following items:
1. Organization system: setting forth the Company's organizational structure and the business in which each major department engages.
2. Chart of Affiliated Enterprises: setting forth the relationship between the Company and its affiliated enterprises, mutual shareholding, shares, and actual investment amounts.
3. President, Vice President, Assistant Vice President, and the Manager of each department and branch institution: (Schedule 2)
(1) Name, work experience (educational background), amount and nature of shareholdings: setting forth the names; major work experience (educational background); positions concurrently held with other companies; job commencement date; number of shares held by them, their spouses, minor children, and under the name of other parties; and the acquisition of employee stock option certificates.
(2) For those who are the spouses of or are related to the president or vice president within the 2nd degree, they shall also set forth their corporate position, name and relationship to the president or vice president.
4. Directors and Supervisors: (Schedules 3 and 4)
(1) Name, work experience (educational background), amount and nature of shareholdings: setting forth the names; major work experience (educational background); positions concurrently held with this and other companies; appointment date and term; number of shares held by them at the time of appointment and those held presently by them, their spouses, minor children, and under the name of other parties, and the possession of professional knowledge and independence. In the case of the representative of a corporate shareholder, the name of the corporate shareholder, and the names of the shareholders who hold more than 10% of the shares of such corporate shareholder, or those who rank in the top 10 in shareholdings, shall be noted.
(2) For those who are the spouses of or are related within the second degree to other managers, the directors or supervisors, they shall also set forth their corporate position, name and relationship to those other managers, the directors or supervisors.
5. Promoters:
(1) For companies established for less than one year, relevant information of promoters whose shareholding percentage is among the top ten of the Company shareholders shall be disclosed as pursuant to the previous provision.
(2) For companies established for less than three years, disclosure shall be made according to the provisions under No. 6 of the ROC Statements of Financial Accounting Standards, where all the important transactions (including property transactions and financing of funds) between the promoters and the Company since incorporation, other than the normal business transactions, shall be disclosed. For property transactions, the nature and location of the transacted item and the method for determining the transaction price shall also be disclosed. For properties purchased from a promoter, if the promoter bought the properties less than two years before selling them out, the promoter's purchasing costs shall also be explained.
6. Remuneration to Directors, Supervisors, President and Vice President (Schedule 4-1):
(1) Remuneration and transportation allowances paid to each director and supervisor for the most recent fiscal year; if a director concurrently holds a managerial position, his remuneration shall be respectively disclosed pursuant to his titles/positions.
(2) The total sum of the compensation, rewards, special allowance and bonus paid to the president and vice president for the most recent fiscal year.
(3) For remuneration other than those specified in the above two sub-paragraphs paid to the directors, supervisors, president and vice president, such as payments relating to provision of car, house/apartment and other exclusive personal expenses, the following information shall be disclosed: name, position, nature and cost of the provided property/asset, the actual or fair-market-value-calculated rental, and any other payments.
"Affiliated enterprise" in subparagraph 2 of the preceding paragraph refers to an affiliated enterprise meeting the requirements in Article 369-1 of the Company Law.
|
|
Article 10
|
The "capital and shares" shall include the following items:
1. Types of Shares: describing the types of the currently outstanding issued shares of the company. (Schedule 5)
2. Formation of Capital: describing the capital changes of the company for the most recent five years and up to the date of publication of the prospectus. If the paid-in capital has been increased, the prospectus shall note the sources of capital, the approval (effective) date for the current capital increase, the approval letter reference number and the amount. If shares are issued at less than par value, such information shall be prominently indicated. If monetary claims against the company, or technology or commercial goodwill needed by the company, are offset against share payments, such information shall be specified, and the type and amount of such offset shall also be noted. If a private placement, such information shall be prominently indicated, and the targets of private placement during the most recent fiscal year and the period up to the day of publication of the prospectus, and their qualifications, subscription quantities, subscription price, and relationship to the company, shall be disclosed. (Schedule 6)
3. Status of Recent Dispersal of Shareholding:
(1) structure of shareholders: setting forth statistics of all types of the shareholders and the ratio thereof. (Schedule 7)
(2) status of dispersal of shareholding: setting forth the statistics of number of shareholders for each category of shareholder classified by various number of shares held by the shareholders, and the ratio between the number of the held shares to the total outstanding issued shares. (Schedule 8)
(3) list of major shareholders: setting forth the names, number of owned shares and the shareholding percentage of those who own 5% or more of the total issued shares or whose shareholding percentage is among the top ten of all the shareholders. (Schedule 9)
(4) the status that directors, supervisors and shareholders holding more than 10% of outstanding shares had waived their subscription right to the cash capital increase during the past two years and in the current year. If the subscription to the cash capital increase being waived was subscribed by related person who was designated for such subscription, the name of such related person, its relationship with the company, directors, supervisors and shareholders holding more than 10% of outstanding shares, and the number of the shares thus subscribed shall also be disclosed. (Schedule 10)
(5) the status of changes that directors, supervisors and shareholders holding more than 10% of outstanding shares had transferred and pledged their shares during the past two years and up to the prospectus' publishing date. If the counter party of such transfer or pledge of shares is a related person, the name of such counter party, its relationship with the company, directors, supervisors and shareholders holding more than 10% of outstanding shares, and the number of the shares thus acquired or pledged shall also be disclosed. (Schedule 11)
4. The per share market price, net worth, profit, dividend and relevant information for the past two fiscal years. (Schedule 12)
(1) the highest, lowest and the average market price per share: Setting forth the highest and lowest market price of each year. And calculating each year's average market price based upon each year's actual transaction prices and volume.
(2) net worth per share: Using the number of the outstanding issued shares at year end as the basis to calculate the respective net worth per share (shareholder's equity) before and after the distribution.
(3) earnings per share.
(4) dividend per share: Setting forth the respective cash dividend and stock dividend of each year. If there are any cumulated and unpaid dividends, their amount shall also be disclosed.
(5) price-earnings (P/E) ratio
(6) price-dividend (P/D) ratio
(7) cash dividend yield.
5. Company dividend policy and implementation status: Shall disclose the dividend policy set forth in the company's Articles of Incorporation and status of dividend distributions contemplated (decided) in the current fiscal year.
6. The effect of dividend distributions contemplated for the current fiscal year on company operating performance and earnings per share.
7. Employee bonuses and compensation of directors and supervisors, including:
(1) the percentages or ranges with respect to employee bonuses and director/supervisor compensation, as set forth in the company's articles of incorporation;
(2) where a profit distribution proposal has been approved by the board of directors but not yet passed by shareholders' meeting, the prospectus shall indicate:
(i) the value of any employee cash/stock bonuses and director/supervisor compensation proposals approved by the board of directors;
(ii) the number of shares to be distributed in any employee stock bonus proposal approved by the board of directors, and the size of such distribution as a percentage of capital increase through capitalization of retained earnings; and
(iii) the effect upon imputed earnings per share of any proposed distribution of employee bonuses and director/supervisor compensation.
(3) where a profit distribution proposal has already been passed by shareholders' meeting, the prospectus shall indicate:
(i) the value of any employee cash/stock bonuses and director/supervisor compensation to be distributed pursuant to shareholders' resolution;
(ii) the number of shares to be distributed in any employee stock bonus to be distributed pursuant to shareholder's resolution, and the size of such distribution as a percentage of capital increase through capitalization of retained earnings; and
(iii) the effect upon imputed earnings per share that will result from distribution of the employee bonuses and director/supervisor compensation.
(4) where employee bonuses and director/supervisor compensation are paid out of earnings from the previous fiscal year, the prospectus shall disclose: (i) actual distributions of employee bonuses and director/supervisor compensation at the time of the preceding fiscal year's profit distributions; (ii) the amount of such distributions as set forth in the proposal adopted at the director's meeting; and (iii) the degree of discrepancy between the two.
8. Status of company buyback of corporate stocks: companies shall describe, for the three most recent fiscal years and the period up to the date of publication of the prospectus, the purpose of the application for buyback of corporate stocks, the time period of buying back stocks, the price range for buybacks, the categories, number, and dollar amount of stocks that have already been bought back, the number of stocks that have already been canceled and transferred, the accumulated number of corporate stocks, and the ratio of the accumulated number of corporate stocks to the total number of issued stocks. (Schedule 13)
|
|
Article 11
|
The description of the status of issue and private placement of "corporate bonds" (including overseas corporate bonds) shall include the following items:
1. For all unredeemed corporate bonds and corporate bonds undergoing private placement, items to be disclosed shall be in accordance with Article 248 of the Company Law. If an SFC-approved or SFC-recognized credit rating institute has been engaged to conduct credit rating thereof, the name of the credit rating institute, the date of the rating and the credit rating result on the corporate bonds shall also be disclosed. If they are attached with conversion, exchange, or subscription rights, the issuance and conversion, exchange, or subscription rules, the possible dilution conditions and influence on shareholders' interests caused by the terms of issuance, and the monetary amount already converted, exchanged, or subscribed up to the prospectus' publishing date shall also be disclosed. (Schedule 14)
2. Corporate bonds maturing within one year: The redemption rules and the monetary amount for the corporate bonds to be matured in one year shall be disclosed.
3. For the issued convertible corporate bonds which are convertible to shares, overseas depositary receipts or any other securities, the issuance date, the conversion price at the time of issue and the conversion method, and the highest and lowest market and conversion price for the past two years and up to the prospectus' publishing date of each convertible corporate bond shall be disclosed respectively. (Schedule 15)
4. For the issued exchangeable corporate bonds, the issue date, the exchanged items, the exchange price at the time of issue, the highest and lowest market price and exchange price and the number of the exchanged items held by the company for the past two years and up to the prospectus' publishing date of each exchangeable corporate bond shall be disclosed respectively. (Schedule 16)
5. If the company adopts the categorical reporting method for the raising and issue of common corporate bonds, relevant information concerning the projected total issue amount, the already issued total amount and the balance amount for the categorical reporting shall be disclosed. (Schedule 17)
6. If the company has already issued corporate bonds with warrants, a separate listing of the issuance date of each corporate bond attached with warrants, the category and number of bonds issued with warrants attached, the restricted subscription time period, the method of fulfilling the agreement, the stock subscription price, the number that have not been subscribed up to the date of the prospectus's publication, and the ratio of the number that have not been subscribed to the total number of issued stocks. (Schedule 18)
7. Status of private placements of corporate bonds in the three most recent fiscal years: Shall disclose the types of corporate bonds; dates and quantities passed by shareholders or board of directors meeting; basis and reasonableness of the setting of price; means of selecting the specified persons (where the offerees have already been arranged, the names of the offerees and the the relationship between the offerees and the company shall also be described); the reasons necessitating the private placement; and the status of implementation as of the day of publication of the prospectus. (Schedule 19)
|
|
Article 22
|
In the analysis of the previous cash capital increase, merger or acquisition, issue of new shares due to acquisition of shares of another company, or plan of utilization of capital from issuance of corporate bonds, the following particulars shall be specified:
1. Contents of the plan: for the previous cash capital increase, merger or acquisition, issue of new shares due to acquisition of shares of another company, or corporate bond issue plan, and for every preceding cash capital increase, merger or acquisition, issue of new shares due to acquisition of shares of another company, or corporate bonds issue plan that has not yet been completed or the actual completion date of which was no more than three years from the date of the report (application), a detailed explanation shall be given of the specific content of each such plan, including the content of each and every changed plan, the source of capital and its usage, reasons for the change, the effects before and after the change, the date that the changed plan was proposed to the shareholders meeting, and the date on which the above information was posted to the information reporting website designated by the SFC shall also be published.
2. Implementation status: Analyzing, item by item up to the quarter immediately preceding the prospectus' publishing date, the status of the plans' implementation and the comparison with the originally projected effects based on the purpose of each of the above-mentioned plans. If the implementation progress or effect does not reach the projected target, a concrete explanation on the causes, impact on the shareholders' equity and improvement plans shall be made. If the content of any of the plans referred to in the preceding subparagraph is as set forth in the following sub-subparagraphs, the information set forth herein below shall also be disclosed:
(1) For acquiring or merging with, or taking assignment of, other companies, or expanding or newly constructing fixed assets, a comparison description on the fixed assets, operating income, operating expenses and operating profits, etc. shall be made.
(2) For re-investing in other companies, description of the re-invested business' operation status and its impact to the company's investment profit/loss shall be made.
(3) For strengthening the operating capital or paying off liabilities, a comparison description on the increase and decrease of current assets, current liabilities total liabilities, interests payment, business income and the retained earning per share etc. as well as financial structure analysis shall be made.
|
|
Article 23
|
The plan for the current cash capital increase, issuance of corporate bonds, or issuance of employee stock option certificates shall specify the following particulars:
1. Sources of capital: Description of whether a cash capital increase or issue of corporate bonds is the capital source for the current plan. If the capital is used to acquire or to invest in other companies, or to expand or newly construct fixed assets, the prospectus shall set forth the total amount of the plan shall be specified. If the funds from the current offering are insufficient, the fund raising methods and sources shall also be described.
2. For the current issue of corporate bonds, relevant particulars shall be disclosed in accordance with Article 248 of the Company Law. If an SFC approved or recognized credit rating institution has been engaged to conduct a credit rating of the bonds, the prospectus shall set forth the name of the credit rating institution, the date of the rating, and the credit rating results shall also be disclosed. If conversion, exchange, or subscription rights are attached to the bonds, the issuance and conversion, exchange, or subscription rules, possibility of dilution of equity under the terms and conditions of issuance, and effect on shareholder equity shall be disclosed.
3. For the current issue of preferred shares, the prospectus shall set forth the par value per share, issue price, effect of issuance terms and conditions on preferred share shareholders' equity, possible conditions of dilution, effect on shareholder equity, and items provided under Article 157 of the Company Law shall be disclosed. If conversion or subscription rights are attached to the shares, the prospectus shall set forth the issuance and conversion rules or subscription rules (including enjoyment and assumption, after the compulsory conversion of the original preferred shares, of rights and obligations existing on the original preferred shares before conversion, such as dividends that have not yet been distributed) shall be disclosed.
4. For unlisted preferred shares or preferred shares not to be traded on an OTC market issued by a listed Company or OTC Company, the prospectus shall set forth the purpose of the issue, reasons why such shares are not to be listed or traded on an OTC market, the effect on existing shareholders and potential investors, and whether there is any plan to apply for listing or trading on the OTC market shall be disclosed.
5. Where employee stock option certificates are issued, the fact of such issue and the attendant subscription rules shall be disclosed.
6. Explanation of the feasibility, necessity, and reasonableness of the current plan and an analysis of the influence of each type of funding on the dilution of earnings per share for the year of the company's report (application) and the following year. For issuance of stock at below par value, the prospectus shall set forth the necessity and reasonableness of issuing new shares at a discount shall be explained, as well as the reasons for not using other capital raising methods and the reasonableness thereof, and amount of offsets against capital reserves or retained earnings.
7. Explanation of the mechanism for setting the current issue price, conversion price, exchange price, or subscription price.
8. Capital utilization estimates and possible resulting effects: Explanation of the progress of the capital utilization and the projected resultant effects after the completion of the current plan.
(1) If acquiring other companies or expanding or newly constructing fixed assets, the prospectus shall set forth the projected possible increased production/sales volume, value, cost structure (including total cost and unit cost), changes of profitability, improvement of product quality and other potential effects upon the completion of the current plan shall be described.
(2) If investing in other enterprises, the following items shall be set forth:
(i) The after-tax net profit of the invested company for the most recent two years, purposes of the investment, planned use of the funds and the relatedness of the enterprise's operations to the company's line of business, and the loss/profits from investment and its impact on the company's operations. If 20% or more of the investee enterprise's common shares are held, the prospectus shall set forth the projected schedule for fund use by the investee enterprise, the number of years within which the invested funds are to be recovered, the projected effect each year before recovery of the funds, and its influence on the company's profitability and earnings per share.
(ii) If re-investing in enterprises where special approval is required, the prospectus shall set forth the status of approval or permission from the competent authority in charge of such special permit enterprises, and whether any terms or conditions attached to the approval or permission have an effect on this offering and issuance of securities.
(3) If replenishing operating capital or paying off liabilities, the following items shall be set forth:
(i) The amount of debt matured annually, repayment plan, status of projected relief of financial burden, current capital utilization status, amount of needed capital and proposed usage plan, and each month's projected schedule of cash receipts and expenditures for the year of the report (application) and the coming one year. (Schedule 47)
(ii) The policy for collection of accounts receivable and payment of accounts payable, capital expenditure plan, and the financial leverage and debt ratio (or the self-provided capital and risk capital ratio) for the year of the report (application) and the coming one year, and the reasons for paying off liabilities or enriching operating capital.
(iii) If the capital increase plan involves paying off liabilities, the prospectus shall set forth the purpose for borrowing funds and the effect achieved in doing so. If the funds were borrowed for purchasing land for construction or to pay for construction costs, the prospectus shall set forth the estimated total amount needed for the completion of project, the source of extra capital needed, the capital for each stage of construction and the progress of the construction, the original reason for borrowing funds, and the timing and amounts for recognizing any profits/losses and the anticipated possible effects of such recognition and the status of realization thereof.
(4) If buying land for construction or paying construction costs, the prospectus shall set forth the estimated total amount needed for completion of the construction, the source of extra capital needed, the capital for each stage of construction and the progress of the construction, the original reason for borrowing funds, and the timing and amounts for recognizing any profits/losses and the anticipated possible effects of such recognition and the status of realization thereof.
(5) If purchasing an unfinished project and assuming the burden of the seller's unfulfilled contract, the prospectus shall set forth the buyer's reason for the transfer, the basis on which the acquisition price was determined, and the effect of the process of acquisition on the rights and obligations of the parties to the contract.
|
|
Article 25
|
For the current issue of new shares due to acquisition or merger, the following particulars shall be specified:
1. Plan content:
(1) Content of the merger or acquisition plan: including the purpose of the merger or acquisition; the integration plan for financial, business, personnel, information, etc. affairs after the merger or acquisition and anticipated benefits; the share conversion ratio and the basis upon which it was calculated; proposed schedule; items that materially affect the share conversion ratio after the public announcement of the merger or acquisition; effects on net value per share and earnings per share; matters related to the assumption of rights and obligations of the extinguished company (including principles for handling treasury shares and already-issued equity securities), and the basic identifying information of the company to be merged or acquired (Schedule 48).
(2) Content of the split plan: the purpose of the split; estimated value of the operations and assets planned to be assigned to the existing company or new company; share conversion rates and the basis upon which they were calculated; the total number and the types and quantities of the shares to be acquired by the split company or its shareholders; matters related to assumption by the existing company or new company of rights and obligations of the split company (including principles for handling treasury shares and already-issued equity securities); matters related to the reduction, if any, in capital of the split company; anticipated benefits of the split.
2. Merger or acquisition contract.
3. Opinion of an independent professional on the reasonableness of the share conversion rate of the merger or acquisition plan.
4. Any restrictions on future transfer or pledge of new shares issued due to the merger or acquisition.
5. The projected consolidated balance sheet as of the record date for calculating the share conversion ratio between the merging and merged companies.
6. Financial statements of the merged company for the most recent two fiscal years, audited and attested by a certified public accountant(s). (If the merged company is not a publicly issued company, its financial statement may be audited/certified by a single certified public accountant.)
7. Minutes of the shareholders meeting of the merged company at which the resolution for merger was passed; however, this restriction shall not apply where any law or regulation provides otherwise.
8. Summary of the merged company's financial and business conditions:
(1) The main content of the merged company's business operations, current products and their uses or current services, the condition of the supply of the main raw materials, and the sales areas for the main products or services shall be set forth.
(2) In accordance with subparagraph 3 of paragraph 1 of Article 18 and subparagraph 1 of Article 28, the buying/selling of the merged company's major assets, the endorsement guaranty, loans made, and other conditions shall be set forth.
(3) In accordance with subparagraph 1 of Article 19, a summary of the merged company's re-investment enterprises shall be set forth.
(4) In accordance with Article 20, important contracts signed by the merged company shall be set forth and the effect on the company's financial and business conditions after the merger shall be described.
(5) In accordance with subparagraph 1 of Article 21, major litigation, non-litigation, and administrative disputes of the merged company and related companies shall be set forth and the effect on the company's financial and business conditions after the merger shall be described.
(6) If the merged company is a construction company or has a construction department, the estimated income and gross profit for each construction project during the year of registration (application) and the preceding year shall be set forth, and the estimated sales of completed but not yet sold projects shall be described.
|
|
Article 27
|
The "financial statement" shall include the following items:
1. The financial statements and certified public accountant audit report for the then past two years at the time when the issuer registered (or applied for) the offering and issuance of securities. If the time when the issuer registers (or applies for) the offering and issuance of securities is more than eight months from the beginning of that year, the financial statement for the first half of that year shall also be included.
2. When a company reports (or applies for approval of) the offering and issuance of securities, if the company is required under the provisions of the Criteria Governing the Offering and Issuance of Securities by Securities Issuers to prepare a financial forecast, a financial forecast reviewed by the certified public accountant shall be disclosed. If more than nine (9) months have passed from the closing of the business fiscal year when the registration (application) is made, the financial forecast for the following year shall further be disclosed.
3. The certified public accountant audited/attested consolidated financial statements for the parent and subsidiary companies for the most recent one year.
4. During the period after the issuer has registered (or applied for) the offering and issuance of securities and until the prospectus' publication date, if there exists any updated certified public accountant audited/attested financial statement, it shall also be disclosed.
5. The estimated and achieved financial condition for the most recent 3 years shall be set forth, and the reason for any difference between the original estimated amounts (including dates of updates [corrections], New Taiwan dollar amounts of updates [corrections], reasons for updates [corrections]) and the actual achieved amounts shall be described. (Schedule 52). Where a penalty was imposed by the Taiwan Stock Exchange Corporation, the GreTai Securities Market, or the SFC, the reason for the penalty shall be specified.
|
|
Article 28
|
The "financial summary and other important matters" shall include the following items:
1. Companies shall disclose the status of extension of endorsements and guarantees and monetary loan to others conducted in the most recent two years and up to the prospectus' publishing date. (Schedules 53, 54)
(1) Setting forth the name of the company being guaranteed, its relationship with the company, the amount guaranteed (the yearly highest amount and the year-end balance amount), reasons for the guarantee, date or conditions for the guaranteed obligations to be relieved, contents and value of the collateral, the capital amount, and the cumulated profit and loss amount in the most recent financial statement of the company being guaranteed.
(2) Setting forth the person to which/whom the monetary loan is extended, its relationship with the company, current account titles, the loan amount (the yearly highest amount and the year-end balance amount), nature of the loan, volume of business with the person, reason for the need of short-term financing, amount designated as allowance against uncollectable accounts; loan period, interest rate collar and method for calculating interest, name and value of the collateral, ceilings on monetary loans to specific persons, aggregate ceiling on all monetary loans, the capital amount, and the cumulated profit and loss amount in the most recent financial statement of the person to which/whom the loan is extended.
(3) If subsidiary companies engage in extension of endorsements and guarantees and monetary loan to others, they shall also make disclosure of the status thereof in accordance with the provisions provided under subparagraph (1) and the preceding subparagraph.
2. Companies shall disclose the relevant information and contents of the transactions of the derivatives products they have conducted in the most recent two years and up to the prospectus' publishing date. (Schedule 55)
(1) For transactional purpose: types of products, total contract amount (the yearly highest amount and the year-end un-offset balance amount) and the realized profit/loss.
(2) For non-transactional purpose:
(i) For hedging the risks of the held assets and liabilities: the types of the derivatives products used, total contract amount (the yearly highest amount and the year-end un-offset balance amount), the amount of the held assets and liabilities being hedged, the profit/loss amount already being recognized and expressly deferred as a result of the hedging.
(ii) For hedging the risks of the expected transactions: the types of the derivatives products used, total contract amount (the yearly highest amount and the year-end un-offset balance amount), the amount of the expected transactions being hedged, the profit/loss amount being expressly deferred as a result of the hedging.
(iii) When the purpose of conducting derivatives transactions is changed from non-business-transactional to business-transactional or is changed from business-transactional to non-business-transactional due to the changes of the objective environment, the causes of the changes and their impact upon profit and loss shall be disclosed.
(iv) If subsidiary companies conduct transactions of derivatives products, they shall also make disclosure of the status thereof in accordance with the provisions provided under subparagraph (1) through the preceding subparagraph.
3. If the company or related enterprises have encountered any financial difficulties in the most recent two years and up to the date of the prospectus's publication, the impact on the company's financial condition shall be set forth.
4. If any of the events in Article 185 of the Company Law has occurred within the most recent two years and up to the date of the prospectus's publication, the following items shall be disclosed:
(1) The cost, payment terms, conditions of payment, and long-range development perspective of accepting transfer (assumption) of business (assets).
(2) After accepting transfer (assumption) of a portion of the other company's operations and research & development results, the current and future operating plan and the effect on the company's research & development, technology, sales profitability and productivity.
5. Subsequent events: During the period after the certified public accountant has completed the most recent year's or the half-year's audited report and until the prospectus' publication date, if any major incident occurs which is likely to impact the financial condition and operating results, it shall be properly disclosed and its impact explained.
6. Others.
|
|
Article 28-1
|
The company shall review and analyze its financial condition and operating results, and shall explain its risk management practices, and in so doing shall describe the following: (Schedule 55-1)
1. financial condition: The prospectus shall explain the reason for, and impact of, any significant change over the most recent two years in the company's assets, liabilities, or shareholders' equity. Where the impact is significant, the prospectus shall further describe how the company plans to respond.
2. operating results: The prospectus shall: (1) explain the reasons for any significant changes over the most recent two fiscal years in operating revenue, operating income, and income before tax; (2) forecast the company's expected sales volume and provide the basis for the forecast; and (3) describe the possible impact of such changes upon the company's financial condition, and how the company plans to respond.
3. cash flows: The prospectus shall: (1) analyze and explain any changes over the most recent fiscal year in the company's cash flows; (2) describe how the company plans to address any illiquidity problems; and (3) provide an analysis of the company's cash liquidity for the coming year.
4. the impact of any major capital expenditures over the most recent fiscal year upon the company's financial and operating condition;
5. the company's reinvestment policy for the most recent fiscal year, the main reasons for profit/losses resulting therefrom, plans for improvement, and investment plans for the coming year;
6. risk management, including analysis and assessment of the following particulars:
(1) the impact upon the company's balance sheet of inflation and changes in interest and exchange rates over the most recent fiscal year, and what measures the company plans to adopt in response;
(2) the company's policy in the most recent fiscal year regarding high-risk, highly leveraged investments, loans to other parties, endorsements and guarantees, and derivatives trading; the main reasons for profits/losses resulting therefrom; and measures to be taken in response;
(3) the company's research and development projects for the most recent fiscal year, degree of progress on research and development projects currently underway, required expenditures, time expected for such projects to go to mass production, and the main factors affecting the success of research and development activities;
(4) the impact of important policies and enactments in Taiwan and overseas during the most recent fiscal year upon the company's financial and operating condition, and the company's response;
(5) the impact of changes in science and technology during the most recent fiscal year upon the company's financial and operating condition, and the company's response; and
(6) the impact of changes in the company's corporate image during the most recent fiscal year upon the company's crisis management, and the company's response; and
7. other important matters.
|
|
Article 29
|
The "special items to be included" shall set forth the important contents of the registration (application) statement, including:
1. Summary of the internal control system: The prospectus shall set forth the certified public accountant's suggestions for improving the internal control system and improvements to major flaws discovered through internal auditing in the most recent three fiscal, and shall also disclose the following items:
(1) Internal control statement.
(2) Where the company has retained certified public accountants to exclusively review its internal control systems, the prospectus shall set forth the reason for doing so, the certified public accountants' opinions, measures the company has taken for improvement, and the condition of improvement on lacking items.
2. Those who have retained the SFC approved or recognized credit rating institutions to conduct credit rating/evaluation shall disclose the credit rating/evaluation report issued by the credit rating institutions.
3. Securities underwriter's summary evaluative opinion.
4. Attorney's legal opinion.
5. Collective opinion stated in the case checklist schedule written by the issuer and reviewed by the certified public accountant.
6. The improvement status of the items notified to be corrected, if at the time the company applied for effective registration (or approval) of the previous offering and issuance of securities the SFC had notified it to make self-correction on certain items.
7. The items notified to be further disclosed, if at the time the company applied for effective registration (or approval) of the previous offering and issuance of securities the SFC had notified it to make supplemental disclosure on certain items.
8. The statement or promised items disclosed in the prospectus from the company's registration (application) for offering and issuance of securities for the first time, the preceding time, and within the most recent 3 years, and the current state of fulfillment of such.
9. The major content of any dissenting opinion of any director or supervisor regarding any material resolution passed by the board of directors, where there is a record or written statement of such opinion, for the most recent 5 years and up to the date of publication of the prospectus.
10. Status of private placements of common shares in the three most recent fiscal years: Shall disclose the dates and quantities passed by the shareholders meeting; basis and reasonableness of the setting of price; means of selecting the specified persons (where the offerees have already been arranged, the names of the offerees and relationship between the offerees and the company shall also be described); the reasons necessitating the private placement. (Schedule 56)
11. The status of corporate governance at listed and OTC companies during the most recent fiscal year and during the current year up to the date of printing of the prospectus, and plans for improvement or response measures. (Schedule 56-1)
12. Any legal sanctions against the company or its internal personnel, or any disciplinary action taken by the company against its own personnel for violation of internal controls, during the most recent fiscal year or during the current year up to the date of printing of the prospectus; and a description of the main shortcomings in the company's internal control system as well as an indication of measures for improvement.
13. Other necessary items to be supplemented and explained.
Subparagraph 11 of the preceding paragraph shall also apply to securities firms that are public companies.
When the issuer, depending on the nature of the business engaged in, has retained experts who have specialized knowledge and abundant experiences in the technology, business, finance and etc. areas to conduct certain comparative analysis over the issuer's current business operational status against the future development after the current issuance of securities, the evaluation and opinion of such experts shall be disclosed.
|
|
Article 30
|
The "important resolution" shall include the following items:
1. important resolutions adopted at meetings of the board of directors, general shareholders' meetings, and special shareholders' meetings held during the most recent two years, as well as resolutions relevant to the current issuance of securities (including the comparison chart on the newly amended and the old clauses of the Articles of Incorporation and the profit distribution schedule);
2. procedures for acquiring or disposing of assets;
3. procedures for lending funds to, or making endorsements or guarantees for, others; and
4. other procedures or rules that shall be included pursuant to SFC regulations.
Subparagraphs 2 to 4 of the above paragraph shall be published based on the most recent amended information of the company.
|
|
Article 32
|
Where a company reports (or applies for approval of) the offering and issuance of securities in accordance with the provisions of paragraph 2 of Article 6 of the Criteria Governing the Offering and Issuance of Securities by Securities Issuers, if the prospectus for listed and OTC companies, written in accordance with Chapter II, has been posted (in the form of electronic files, prepared in the format prescribed by the SFC) to the information reporting website designated by the SFC and has been provided in printed book format at the following places for investors to read, a simplified version of the prospectus may be used for delivery to the subscribers and offerees:
1. Taiwan Stock Exchange Corporation
2. GreTai Securities Market
3. Securities & Futures Institute
4. Chinese Securities Association
5. The head office of the lead underwriter and co-underwriter for this offering and issuance.
Any publicly issued companies that satisfies the following criteria shall not be restricted by the regulations of the preceding paragraph and may directly deliver the simplified version of its prospectus to subscribers or offerees:
1. Is preparing to issue common corporate bonds and, within the last year, has obtained a review report from an SFC-approved or SFC-permitted rating institution or a guaranty from a financial institution.
2. Has handled a public offering and issuance of securities during the same accounting year in accordance with the regulations of the preceding paragraph, and is once again registering (or applying for approval of) the public offering and issuance of securities.
In cases such as issuance of new shares by unlisted or non-OTC companies where exempted from public offering, issuance of new shares due to merger or acquisition, or issuance of new shares due to acquisition of another company's shares, or issuance of employee stock option certificates by public issuers, the issuer may directly deliver the simplified prospectus to the subscribers or offerees, and shall not be subject to the restrictions in paragraph 1.
|
|
Article 33
|
In addition to the descriptions required on the front of the cover, inside the cover, and on the back of the cover of the simplified version of the prospectus in accordance with Articles 3 to 5, the front of the cover shall have a label stating simplified version of the prospectus in prominent type, and inside the cover, there shall be additional information on the web site and locations where investors can find the prospectus written in accordance with Chapter II.
The contents of the simplified version of the prospectus shall include the following:
1. Summary of the condition of the company: the items required under Article 8; subparagraphs 2 and 4 of paragraph 1 of Article 9; subparagraphs 2, 4 and 7 of Article 10; and sub-subparagraphs 3 and 4 of subparagraph 3 of Article 10.
2. Summary of the condition of operation: the items required under sub-subparagraphs 1 to 3 of subparagraph 1 and sub-subparagraphs 1 and 4 of subparagraph 2 of Article 17, subparagraph 3 of Article 18, subparagraphs 1 and 3 of Article 19, Article 20, and subparagraph 1 of Article 21.
3. Issuance plan and implementation status: the items required under Article 23, Article 24, and subparagraphs 1 to 5 of Article 25.
4. Summary of Financial Affairs: items required under subparagraph 4 of Article 26, Article 27 (not including notes to the financial statements and appended figures), subparagraph 4 of Article 28, and Article 28-1.
5. Special items: items required under sub-subparagraph 2 of subparagraph 1 of paragraph 1 of Article 29, and subparagraphs 2 (applicable only to the issuance of corporate bonds), 3, 4, 5, 7, 9, and 11 of paragraph 1 of Article 29.
Publicly issued companies satisfying the criteria of subparagraph 2 of paragraph 2 of the preceding Article shall, in the simplified version of their prospectus for the current offering and issuance of securities, in addition to following the regulations in the preceding paragraph, disclose the contents of any changes or additions made to the previous prospectus.
|
|
Article 35
|
The draft prospectus shall be posted, as an electronic file in the format prescribed by the SFC, to the information reporting website specified by the SFC and, within thirty (30) days from the date of effective registration or receipt of the SFC's approval notice, the final amended/revised prospectus shall be shall be posted, as an electronic file in the format prescribed by the SFC, to the information reporting website specified by the SFC.
|