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Article 33
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The conversion of convertible bonds to stocks is not subject to the restriction of Article 140 of the Company Act that the issuing price of the stocks may not be below par value.
The conversion price for convertible bonds issued by an emerging stock company may not be lower than the weighted average trade price for the company's common shares during the period preceding the price determination date, nor may it be lower than the company's net value per share as reported in the financial reports for the most recent fiscal period, audited and attested (or reviewed) by a CPA, and a recommending securities firm shall be retained to give an opinion on the reasonableness of the issuing price.
The issuing and conversion price for convertible bonds issued by a company whose shares are neither listed on an exchange nor traded on an OTC market shall not be lower than the company's net value per share as reported in the financial reports for the most recent fiscal period, audited and attested (or reviewed) by a CPA, and a CPA shall be retained to give an opinion on the reasonableness of the issuing price.
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Article 42
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The face value of a corporate bond with equity warrants is limited to NT$100,000 or multiples thereof.
In cases where it is necessary to issue new shares in connection with exercise of warrants, the total number of new shares multiplied by the exercise price per share may not exceed the total issued amount, in terms of face value, of the subject corporate bonds.
The exercise price for the corporate bonds with equity warrants issued by an emerging stock company may not be lower than the weighted average trade price for the company's common shares during the period preceding the price determination date, nor may it be lower than the company's net value per share as reported in the financial report for the most recent fiscal period, audited and attested (or reviewed) by a CPA, and a recommending securities firm shall be retained to give an opinion on the reasonableness of the issue price.
The exercise price for shares of corporate bonds with warrants issued by a company whose shares are neither listed on an exchange nor traded on an OTC market may not be lower than its net value per share as reported in the financial report (audited and attested [or reviewed] by a CPA) for the most recent fiscal period, and a CPA shall be retained to give an opinion on the reasonableness of the issue price.
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Article 43
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When issuing corporate bonds with equity warrants, with the exception of listed or OTC companies, for which an underwriter shall be engaged to underwrite all bonds issued on a firm commitment basis, the bonds may not be underwritten and offered to the public.
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Article 44
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Prior to offering the corporate bonds with equity warrants, the issuer shall make public announcement on the exercise price.
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Article 45
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From the end of a designated period of time following the issuance date of corporate bonds with warrants until 10 days before the maturity date, the bondholder may request for exercising warrants at any time in accordance with the terms set by the issuer, except during the period in which transfer is suspended by laws. However, the exercise period may not be longer than the repayment period for the corporate bond.
The designated period of time referred to in the preceding paragraph shall be set by the issuer in its terms for issuance and exercise.
Corporate bonds with warrants issued by an exchange-listed, OTC-listed, or emerging stock company are not subject to the restriction of paragraph 1 that exercise may not be made during the 10 days before the maturity date.
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Article 46
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The performance of obligations by the issuer regarding exercise of warrant is not subject to the restriction of Article 140 of the Company Act that the issue price of the stocks may not be below par value.
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Article 47
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When requesting for exercising warrants, the holder shall fill out an exercise request form and submit it to the issuer or its agent for such purpose. After receiving such request and full payment of the stock price, the issuer or its agent shall enter the name of the bondholder into the shareholder register and deliver the new shares or certificates of payment for shares to the holder within 5 business days.
The aforesaid shares or certificates of payment for shares issued by listed, OTC, or emerging stock companies in accordance with the preceding paragraph may be traded in the stock exchange market or at the business places of securities firms from the day of delivery to shareholders.
Where the issuer delivers shares under paragraph 1, it shall, within 15 days after the end of the current quarter, publicly announce the amount of new shares issued in the preceding quarter.
For new shares issued under paragraph 1, the day, month, and year of effective registration as stated in the FSC notification may be substituted for the day, month, and year of amendment registration for issuance of new shares under Article 162, paragraph 1, subparagraph 2 of the Company Act; after such issuance of new shares, the issuer shall, at least once per quarter, submit an application for capitalization amendment registration to the competent authority for company registration, annexing the FSC's letter of approval for the original issuance.
Before the end of each fiscal year, the issuer issuing the certificates of payment for shares in accordance with paragraph 1 shall present evidence of full payment of the stock price and the consent letter from the FSC which previously approved the issuance of corporate bonds with equity warrants and apply to the competent authority in charge of the corporate registration to register the change in its capital and to issue new shares.
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Article 48
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Corporate bonds with equity warrants, and duly applied for and issued certificates of payment for shares, or stocks, except where in scripless form, shall uniformly be in registered form.
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Article 49
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Except where physical certificate is not printed, before the formal delivery of exchanged shares or certificates of payment for shares in accordance with Article 47, these shares or certificates shall be certified by the certifying organization in accordance with the Regulations Governing Certification of Corporate Stock and Bond Issues by Public Companies.
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