The following items shall be specified in the terms of issuance and conversion when issuing convertible bonds:
Where secured convertible corporate bonds are backed by the stocks of another company held by the issuer, the provisions of Article 25 shall apply mutatis mutandis.
- Issue date.
- Coupon rate and payment of interest.
- Date of interest payment.
- Type of corporate bonds, the face value of each bond and the aggregate amount of this issuance.
- The availability of collateral or guarantee.
- The name of trustee and material covenants.
- Terms of repayment (e.g. repayment of principal upon maturity, payment of principal prior to maturity, terms of call or redemption, etc.).
- The listing or trading at the business places of securities firms of convertible bonds of an exchange-listed or OTC-listed company.
- Procedures regarding request for conversion.
- Criteria for setting terms and conditions of conversion (including conversion price, conversion period and the classes/types of shares to be converted with).
- Adjustment of conversion price.
- The disposition of interests and dividends in the year of conversion.
- The disposition of monetary value for the conversion of less than one share while processing a conversion.
- Rights and obligations after conversion.
- The number of times and date for the bondholder to submit the certificates of conversion to acquire new stocks.
- Conversion shall be performed by either issuing new shares or delivering already issued shares, except that conversion by an emerging stock company or a company whose shares are neither listed on an exchange nor traded at the business places of securities firms shall be effected only through the issuance of new shares.
- Procedures for obtaining the convertible bonds.
- Other important stipulations.