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Article 10
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An application for initial listing of stock filed by an issuing company shall not be approved unless and until share certificates representing at least fifty percent (50%) of the number of shares held by each of the following persons of the issuing company specified in the application for listing (with the total number of such shares being not less than the ratio specified in Paragraph 2 of this Article), along with the remaining share certificates representing all other shares after deducting those required for public offering, have been placed in centralized custody with a centralized securities depository enterprise incorporated with the approval of the Competent Authority; provided however, that if the total number of shares held by directors and supervisors is less than the total number thereof held by them at the time when they were elected as directors and supervisors, then the total number of shares at the time when they were elected shall be the basis for counting the number of shares under this Article. If the number of shares represented by share certificates placed in centralized custody pursuant to the above is less than the ratio specifies in Paragraph 2 of this Article, the shortage shall be made up by other shareholders:
1. Where the application for listing is filed in accordance with the provisions of Article 4 or Article 6 of these Criteria, its directors, supervisors and the shareholders holding ten percent (10%) or greater of the total number of issued and outstanding shares of the issuing company.
2. Where the application for listing is filed in accordance with the provisions of Article 5 of these Criteria or where the applicant is an information software enterprise, its directors, supervisors, shareholders holding five percent (5%) or greater of the total number of issued and outstanding shares, and/or shareholders whose equity investment is made in the form of patent rights or technical know-how, and who are working for the issuing company and hold five tenths percent (0.5%) or greater of the total number of shares or 100,000 or more shares as of the date on which the application for listing is filed. However, this restriction shall not apply where shareholding of a recommending securities firm during the period of registration as emerging stock exceeds 5 percent of the total issued shares of said issuing company as a result of subscription or trading of operating securities during the emerging stock trading period.
The total number of shares with respect to the share certificates to be placed in centralized custody by the issuing company under the preceding paragraph refers to the total number of issued and outstanding shares calculated as the aggregate of shares of common stock that have already been publicly offered and issued or privately placed and shares of common stock subscribable or convertible through preferred shares with warrants, convertible preferred shares, corporate bonds with warrants, and convertible corporate bonds that have already been publicly offered and issued or privately placed; the total ratio of share certificates to be placed in centralized custody by the issuing company shall be calculated as set forth below, provided, the number of shares to be placed in centralized custody by the issuing company shall not exceed a maximum of 50 percent of its original total number of issued and outstanding shares, and share certificates placed in centralized custody shall be confined to share certificates of publicly offered and issued common stock:
1. Where the total number of issued and outstanding shares is 30,000,000 or less, share certificates representing thirty percent (30%) of which shall be placed in depository.
2. Where the total number of issued and outstanding shares is more than 30,000,000 but 100,000,000 or less, share certificates representing twenty percent (20%) of the portion of shares in excess of 30,000,000 shares shall be placed in centralized custody in addition to those required under the preceding item.
3. Where the total number of issued and outstanding shares is more than 100,000,000 but 200,000,000 or less, share certificates representing ten percent (10%) of the portion of shares in excess of 100,000,000 shall be placed in centralized custody in addition to those required under the preceding item.
4. Where the total number of issued and outstanding shares is more than 200,000,000, share certificates representing five percent (5%) of the portion of shares in excess of 200,000,000 shall be placed in centralized custody in addition to those required under the preceding item.
Among the share certificates placed in centralized custody by the directors, supervisors and shareholders pursuant to the provisions of Paragraph 1 of this Article, one fifth (1/5) of the portion thereof comprising not less than fifty percent (50%) of the shares held by the respective person with the total number of shares being not less than the ratio specified in Paragraph 2 of this Article may be taken back only after the lapse of two (2) full years from the listing date thereof; thereafter, one fifth (1/5) thereof may be taken back once every six (6) months. The share certificates other than those referred to in the preceding sentence and those for public offering may be taken back after the lapse of one (1) full year from the listing date thereof. The custodial agreement shall not be terminated during the term thereof. Share certificates and vouchers evidencing that share certificates are placed in centralized custody shall not be transferred or pledged. The validity of centralized custody shall not be affected by the change of the identity of the holders of share certificates in centralized custody; provided that, however, if the holder's identity changes during the custody period and if the holder has negotiated with the directors and/or supervisors taking office at the time of initial public offering to make up the same number of shares for placing in centralized custody, he may take back the same number of shares without being subject to the said restrictions.
The provisions of Paragraph 1 of this Article shall not apply to directors, supervisors and shareholders of government authorities, government-owned enterprises, or which have obtained an approval from the authority in charge of the enterprise concerned for the sale of the shares held by them and have been determined to be inappropriate to place such share certificates in centralized custody.
The total ratio of share certificates to be placed in centralized custody as specified in Paragraph 2 of this Article shall not apply to government-owned enterprises.
When the directors and supervisors of an issuing company referred to in Paragraph 3 above take back their share certificates placed in centralized custody after lapse of the centralized custody period, if such taking back causes the total shares placed in centralized custody by all the directors and supervisors to become less than the ratio of total shareholding under the "Regulations Governing the Shares Ownership Ratio of the Directors and Supervisors of Public companies and Examination and Enforcement Thereof" (hereinafter referred to as the "Shareholding Ratio"), the directors and supervisors may only take back the portion in excess of the Shareholding Ratio. The remaining shares shall continue to be placed incentralized custody. If re-election of directors and supervisors occurs during the centralized custody period, the portion of the shares of all re-elected directors and supervisors meeting the Shareholding Ratio shall continue to be placed in centralized custody. This provision shall also apply after lapse of the centralized custody period.
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Article 11
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Where an issuing company applies for initial listing of its common stock or various preferred stock, it shall allocate in accordance with the stipulations of this Corporation certain percentage of shares and retain a securities underwriter to offer such shares to the public before the shares are listed. Except for the shares of a securities firm, it shall be specified in the underwriting agreement that a certain proportion of the shares to be offered to the public shall be reserved for subscription by the securities underwriter, and the said proportion shall be not less than 10% and not more than 25% of the total number of underwritten shares; provided that the above requirement shall not be applicable if the issuing company has issued new shares during the period between six (6) months before the day on which it applies for listing and the day on which its stocks are listed, and has allocated in accordance with the stipulations of these Criteria certain percentage of shares to be listed for public offering, and if the shareholdings have been dispersed in compliance with the criteria set forth in these Criteria.
An issuing company which applies for the listing of its stock pursuant to Article 5 of these Criteria shall retain a securities underwriter to sell its stock on a firm commitment basis, and shall specify in the underwriting agreement in accordance with Paragraph 2 of Article 71 of the Securities and Exchange Law that the securities underwriter shall reserve for its own account 50% of the shares to be offered to the public.
The provisions in the preceding two paragraphs regarding subscription by the securities underwriter shall not apply to state-owned applicant company.
The total number of shares to be allocated by the issuing company for public sale under paragraph 1 refers to the total number of issued and outstanding shares calculated as the aggregate of shares of common stock that have already been publicly offered and issued or privately placed and shares of common stock subscribable or convertible through preferred shares with warrants, convertible preferred shares, corporate bonds with warrants, and convertible corporate bonds that have already been publicly offered and issued or privately placed; provided, share certificates allocated for public sale shall be confined to share certificates of publicly offered and issued common stock.
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Article 12-1
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An issuing company that privately places securities may not apply for initial listing of such privately placed securities during the period of restriction of transfer as set forth in Article 43-8 of the Securities and Exchange Law. If, once the period of restriction of transfer has elapsed, the company intends to apply for listed trading of the securities, it may file such application only after first completing public issuance examination and approval procedures with the Competent Authority.
A listed company may not list its privately placed securities during the period of restriction of transfer as set forth in Article 43-8 of the Securities and Exchange Law; it also may not list common shares created by the exercise of conversion rights or subscription rights. If, once the period of restriction of transfer has elapsed, the company intends to apply for listed trading of the securities, it may file such application only after first completing public issuance examination and approval procedures with the Competent Authority. However, it may be exempted from the requirement of carrying out public offering prior to listing under Article 11.
Where the Competent Authority has restricted the listed trading of securities issued by a listed company, privately placed securities of the company may not be listed until such restriction has been lifted, even if the period of restriction of transfer has elapsed.
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Article 14
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Where a listed company issues new shares that are of the same type of stocks as those which has already been listed and applies for listing the new shares, such new shares may be listed in accordance with the provisions of Paragraph 2 of Article 139 of the Securities and Exchange Law, and any certificates carrying right to convert bonds into stock issued by the said listed company may also be listed on the exchange of this Corporation in accordance with the said provisions of the Securities and Exchange Law.
Where a listed company issues new shares that are not of the same type of stocks as those which have already been listed and applies for listing of the new shares, this Corporation may agree to list the new shares if the total par value of the shares under application for listing is NT$300,000,000 or more and the said company allocates in accordance with Paragraph 1 of Article 11 of these Criteria a certain percentage of the shares and retains a securities underwriter to offer the shares to the public before they are listed. The issuing company may specify in the underwriting agreement that the securities underwriter reserves for its own account a certain proportion of the shares (except for the shares of a securities firm) to be offered to the public. Such proportion shall be not more than 15% of the total underwritten shares, and the issuing company shall comply with the shareholding dispersion standards in Article 4, Paragraph 1, Subparagraph 4 of these Criteria. Provided, this Corporation may disagree to the listing in any of the following events:
1. Its before-tax net profit for the most recent two (2) years is in a negative figure.
2. At the time of approving the issuance of new shares, the Competent Authority deemed it inappropriate to offer the new shares to the public at market price, and the causes therefor have not been extinguished.
3. The most recent application for public offering and issuance of securities was returned or disapproved by the Competent Authority, and the causes therefor were material and have not been improved.
4. The securities previously issued by the company were restricted from listing for causes under Paragraph 1 of Article 156 of the Securities and Exchange Law, and such causes have not be extinguished, or any event under Paragraph 1 of Article 156 of the Securities and Exchange Law has occurred.
5. There exists other events that are deemed by this Corporation as inappropriate for listing.
A listed company applying for listing of shares issued by it that are not of the same type of stock as those already listed and that are redeemable for cash upon maturity shall comply with the provisions of the preceding paragraph; however, the shareholding dispersion standards in Article 4, Paragraph 1, Subparagraph 4 of these Criteria shall not apply.
A listed company shall promptly report to this Corporation, by submitting a Listed Securities Report Form, any common shares created through the exercise of conversion rights or subscription rights under any preferred shares with warrants, convertible preferred shares, corporate bonds with warrants, and convertible corporate bonds offered and issued by it, and may be exempted from the requirement of public offering under Article 11. Provided, if such offered and issued preferred shares are prohibited from listing under the proviso to paragraph 2 of this Article, common shares created through the exercise of conversion rights or subscription rights thereunder shall also be prohibited from listing.
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