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Article 3
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The following items shall be printed in the order below on the cover of a public offering prospectus:
1. Issuing company name and seal.
2. This public offering prospectus is prepared for the purpose of issuing call (put) warrants.
3. The following items in summary description:
(1) The date of issuance and duration of the warrants.
(2) Detailed information on the underlying index, underlying securities or basket of securities.
(3) The type of call (put) warrants, units issued, and the issue's total value.
(4) Terms and conditions of issuance (with the following conditions set off in a distinctive typeface: the issuance price, strike price or strike index, and exercise period; for knock-out call warrants or knock-out put warrants, conditions regarding upper and lower price or index caps and the fact that the date on which the closing price of the underlying security/securities or the closing index of the underlying index reaches the upper or lower price or index cap will be deemed the final trading day for the warrants, which will mature on the second following business day, requiring automatic settlement exclusively in cash at the closing price of the underlying security/securities or the closing index of the underlying index on the warrants' final trading day). For a call warrant, the abovementioned strike price or strike index may not exceed 150 percent of the underlying security's closing price or the underlying index's closing index on the date of application; for a put warrant, the strike price or strike index may not be lower than 50 percent of the underlying security's closing price or the underlying index's closing index on the date of application, provided that the above ratios may be exceeded when the strike price and the closing price of the underlying security or securities differ by less than NT$30. A reasonable cause and explanation for any terms of issuance not conforming to the above standards must exist and must be fully disclosed to investors.
(5) The method of calculating the issuance price, including the price of the underlying security or underlying index, strike price or strike index, duration of the warrants, interest rate, volatility, and other reference factors, and a comparison table showing other warrants in the preceding year with the same listed underlying security or index.
(6) Detailed information on the guarantor and the guaranty agreement or collateral.
(7) The leverage effect and premium.
(8) The number of shares (or beneficial interest units, or depositary receipt units, or index points) represented by each issuance unit.
4. The following statements shall be set off in a distinctive typeface:
(1) Call (put) warrants involve a high degree of risk. Purchasers should understand that call (put) warrants may have no value at maturity, and should be prepared for the possibility of losing the subscription price. Call (put) warrants whose underlying is an exchange-traded fund with foreign component securities, an offshore exchange-traded fund, or a foreign security or index, are not subject to any price fluctuation limit. Purchasers and sellers of call (put) warrants whose underlying is a foreign security or index should also consider the exchange rate and other risks.
(2) An issuer may not use the fact of having obtained approval of qualification for issuance of call (put) warrants or TWSE approval for listing of its planned call (put) warrants issue in any promotion as proof of the matters under application or as a guarantee of the value of the call (put) warrants.
(3) The issuer, the issuer's responsible person, and other persons whose seal or signature appear on the prospectus bear legal liability for any misrepresentation or nondisclosure within the prospectus.
5. The printing date.
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Article 8
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The issuance plan shall list the following items:
1. The date of issuance and duration of the warrants.
2. Detailed information on the underlying indexes, underlying securities, or basket of securities (including, if the underlying securities of the warrants are domestic stocks for which the CPA audited or reviewed financial report for the most recent period shows losses, a statement of the reason for issuing warrants on the underlying securities, or if the underlying securities are foreign stocks or depositary receipts, a statement on the status of their liquidity).
3. The type of call (put) warrant, units issued, and total value of the issue.
4. Terms and conditions of issuance (including issuance price, strike price or strike index, duration, and the number of shares (or beneficial interest units, or depositary receipt units, or index points) represented by each issuance unit; for knock-out call warrants or knock-out put warrants, conditions regarding upper and lower price caps and the fact that the date on which the closing price of the underlying security/securities or the closing index of the underlying index reaches the upper or lower price or index cap will be deemed the final trading day for the warrants, which will mature on the second following business day, requiring automatic settlement exclusively in cash at the closing price of the underlying security/securities on the warrants' final trading day, with such conditions set off in a distinctive typeface). For a call warrant, the abovementioned strike price or strike index may not exceed 150 percent of the underlying security's closing price or underlying index's closing index on the date of application; for a put warrant, the strike price may not be lower than 50 percent of the underlying security's closing price or the underlying index's closing index on the date of application, provided that the above ratios may be exceeded when the strike price and the closing price of the underlying security or securities differ by less than NT$30. A reasonable cause and explanation must exist for any terms of issuance not conforming to the above standards and must be fully disclosed to investors.
5. The method of calculating the issuance price, including the price of the underlying security or the underlying index, strike price or strike index, duration of the warrants, interest rate, volatility, and other reference factors, and a comparison table showing other warrants in the preceding year with the same listed underlying security.
6. Detailed information on the guarantor and the guaranty agreement or collateral.
7. The required particulars as specified in Article 8 of the TWSE Operating Rules Governing Liquidity Providers for Call (Put) Warrants.
8. Procedures for exercising the warrants, and the terms requiring cancellation of call (put) warrants when surrendered for exercise.
9. Procedures for exercise/delivery when the warrant holder exercises the option. When the issuer may opt for cash settlement of call warrants to be paid in securities, or when the warrant holder may opt for cash settlement of put warrants to be paid in securities, the conditions shall be set off in a distinctive typeface.
10. Strategies for offsetting foreseeable risks.
11. Stipulations regarding adjustment of the strike price of the call (put) warrants and related matters due to distributions of dividends or bonuses, increases or decreases in capital, stock splits or consolidations, or other related action by the issuer of the underlying securities, or the distribution of dividends or other related action on the underlying exchange-traded funds by the securities investment trust enterprise (SITE), or on the underlying offshore exchange-trade funds by the offshore fund manager or its designated institution. If the issuer's adjustments are not made according to the TWSE reference formula (see attachment), that fact shall be noted in a distinctive typeface in the public offering prospectus. If the underlying is a foreign security, the issuer shall adopt its own formula for adjustment.一二、標的證券發行公司有公司合
12. The methods for handling a merger by the issuer of the underlying securities, alteration of the securities' trading method, suspension of securities sale or de-listing of the securities, or the de-listing of the exchange-traded funds as a result of dissolution or bankruptcy of the SITE or a voidance of the approval, or the delisting by the TWSE, after it has reported to and obtained approval from the Competent Authority, of the beneficial certificates, fund shares, or investment units of an underlying offshore exchange-traded fund, or the discontinuation, by the provider of the underlying index, of compilation of the index.
13. The methods for handling the listing of the call (put) warrants or the de-listing or suspension of sale of the warrants by the stock exchange.
14. Clarification regarding whether or not there are plans for a reverse issue of call (put) warrants against the same underlying securities within the coming three months.
15. Other items required by the competent authority or the TWSE.
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Article 10
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The prospectus shall list the following items related to the underlying index and underlying securities:
1. If the underlying object is not an index, the company profile (if the underlying is an exchange-traded fund or an offshore exchange-traded fund, the name of the component companies of the fund shall be indicated).
2. Information on the price of the underlying securities or index (to include trading volumes, highest and lowest prices, and monthly closing prices for the most recent year; if the underlying object is an index, include the highest and lowest prices, and monthly closing indexes for the most recent year).
3. If the underlying securities are stocks or depositary receipts, the condensed balance sheets and income statements for the underlying securities for the most recent two years.
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