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49-4
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If any of the following circumstances applies to a TIB listed company or a TIB primary listed company, the TWSE may place its listed stocks under the altered trading method:
- The latest financial report, as registered and publicly announced in accordance with Article 36 of the Securities and Exchange Act, shows that its net worth is less than one-third of its share capital stated on the financial report.
- A regular shareholders meeting has not been held within 6 months after the end of the fiscal year.
- The attesting CPA for the most recent financial report publicly announced and registered pursuant to Article 36 of the Securities and Exchange Act issues a qualified audit report or a review reportwith a qualifiedconclusion. However, this shall not apply if it is otherwise permitted by the laws and regulations of the competent authority, or in the case of an interim financial report if the reason is that the calculation of investment in a non-major subsidiary, or investment accounted for using the equity method, and the amount of profit or loss thereupon, is based on a financial report that has not been audited or reviewed by a CPA, and the attesting CPA has fully disclosed in the audit or review report the reasons for the qualified opinion and the monetary amounts of any accounting items that may be affected thereby, and no material irregularities are present.
- Violation of relevant bylaws or rules concerning the material information of a TWSE listed company, and failure to rectify the situation within the specified time after having been notified to proceed with disclosure process, and such violation was serious.
- Two-thirds or more of the directors have been provisionally ordered to be suspended of the performance of their authorities and duties.
- A petition for re-organization has been filed to the court in accordance with Article 282 of the Company Act or to the court of the jurisdiction of incorporation.
- Half or more of the directors have changed, such that any of the following circumstances exists, and it fails to make improvement within a specified time period ordered by the TWSE:
- The shareholding is too concentrated to meet the shareholding dispersion criteria under Article 29, paragraph 1, subparagraph 4 of the TWSE Rules Governing Review of Securities Listings.
- The newly appointed directors or president meet any of the conditions under Article 31, paragraph 1, subparagraph 7 of the TWSE Rules Governing Review of Securities Listings.
- The company is unable to punctually pay for the common corporate bonds or convertible corporate bonds which have matured or which the creditors requested it to redeem.
- Dishonor of a negotiable instrument by a financial institution because of insufficient funds on deposit, where the TWSE is aware of such dishonor.
- Failure to abide by an undertaking to purchase the shares held by other shareholders of a TWSE listed (or TPEx listed) subsidiary in which it has shareholding of more than 70 percent or a TIB listed subsidiary or TIB primary listed subsidiary in which it has shareholding of more than 80 percent.
- Any of the following circumstances occurs in the handling of stock affairs:
- The company has not engaged an agent of stock affairs, and has not obtained the Taiwan Depository and Clearing Corporation's review and agreement to handle stock affairs.
- The Taiwan Depository and Clearing Corporation has audited and discovered a material irregularity in stock affairs, and the company has failed to correct the irregularity within the deadline set by the TWSE for corrections.
- Where explanations given in a press conference concerning material information fail to clarify points in question, and the TWSE deems it necessary to protect the rights and interests of investors.
- The number of listed common shares does not reach 25 percent of the total number of the company's issued common shares and5 million shares.
- It fails to meet the requirements under Article 50-9, paragraph 2, subparagraph 12 within 6 months after trading is suspended according to paragraph 1, subparagraph 12 of the same article.
- The board of directors resolves to refer a dissolution proposal to a shareholders meeting for resolution.
- Directors of a TIB primary listed company with registered household in the Republic of China take less than a majority seats in the board, or fewer than two independent directors have a registered household in the Republic of China, and no special shareholders meeting has been held for a re-election within 60 days of occurrence of the fact.
- The TWSE deems it necessary to do so for any other reason.
Where the listed stocks of a TIB listed company or a TIB primary listed company are placed under an altered trading method due to a circumstances provided in the subparagraphs of the preceding paragraph, if the following subparagraphs are met and none of the circumstances under the subparagraphs of the preceding paragraph exists, the TWSE may resume the original trading method of its stocks:
- After its stocks have been placed under an altered trading method pursuant to subparagraph 1 of the preceding paragraph, the latest two financial reports, as registered and publicly announced in accordance with Article 36 of the Securities and Exchange Act, both show that its net worth is more than than one-third of its share capital stated on the financial report. However, in the case of decrease of capitalization, the procedure to replace securities for capital reduction should be completed.
- After its stocks have been placed under an altered trading method pursuant to subparagraph 2 of the preceding paragraph,
- After its stocks have been placed under an altered trading method pursuant to subparagraph 3 of the preceding paragraph, it has made corrections or improvements and the circumstances under that subparagraph no longer exist.
- After its stocks have been placed under an altered trading method pursuant to subparagraph 4 of the preceding paragraph, it has rectified the situation after having been notified to proceed with disclosure process.
- After its stocks have been placed under an altered trading method pursuant to subparagraph 5 of the preceding paragraph, the court has vacated the provisional order and then more than one-third of the company’s directors are able to perform their authorities and duties.
- After its stocks have been placed under an altered trading method pursuant to subparagraph 6 of the preceding paragraph, the petition for re-organization was withdrawn or was conclusively dismissed by court pursuant to Article 283-1, subparagraph 1 or Article 285-1, paragraph 3, subparagraph 1, or was conclusively dismissed by court of the jurisdiction of incorporation pursuant to law;provided that the execution period of the altered trading method shall not be less than 3 months where the petition for re-organization was withdrawn
- After its stocks have been placed under an altered trading method pursuant to subparagraph 7 of the preceding paragraph, corrections or improvements were made.
- After its stocks have been placed under an altered trading method pursuant to subparagraph 8 of the preceding paragraph, the company has repaid the debt or reached a settlement agreement with the creditors.
- Within 3 months of the trading day next following the date its stocks have been placed under an altered trading method pursuant to subparagraph 9 of the preceding paragraph, the company has completed any of the remedial procedures enumerated herein below, and the company has produced a direct or indirect note in evidence thereof from the clearing house, and no further instance of dishonor of negotiable instruments has occurred prior to resumption. However, if the company adopts the remedial procedure of “extinguish the debt under the negotiable instrument by actual settlement of the amount of the instrument” or “complete negotiation of settlement with correspondence financial institution”, it shall additionally submit a rechecking form prescribed by the TWSE. The form shall be signed and certified by a CPA and a lawyer and submitted to the TWSE along with the other relevant documents and materials for approval and recordation:
- Extinguish the debt under the negotiable instrument by actual settlement of the amount of the instrument.
- Deposit the amount of the instrument into the financial enterprise that dishonored the instrument with a request that it be listed as provision for payment under "other payables."
- Pay the amount of the instrument out of the checking account or other payables account upon re-presentment of the instrument subsequent to its dishonoring.
- Where correction or improvement has been made within 3 motnhs after its stocks have been placed under an altered trading method pursuant to subparagraph 10 of the preceding paragraph.
- Where correction or improvement has been made within 3 motnhs after its stocks have been placed under an altered trading method pursuant to subparagraph 11 or 13 of the preceding paragraph,
- Where the points in question have been clarified after its stocks have been placed under an altered trading method pursuant to subparagraph 12 of the preceding paragraph, provided that if the TWSE determines there is any material deficiency in the design and execution of the company's internal control system, in addition to clarifying the points in question, the company shall revise its internal control system and shall have implemented the revisions for at least 3 months and obtained a CPA-issued audit opinion letter regarding the effectiveness of the aforementioned internal control system's design and execution.
- Within two years after the securities have been placed under the altered trading method due to the circumstances in subparagraph 14 of the preceding paragraph, the sum of the net profit before tax attributable to owners of the parent stated in the publicly announced and filed financial reports for the most recent four periods reaches 3 percent or more of the share capital stated in the financial reports for the most recent period, and the requirements of Article 50-9, paragraph 2, subparagraph 12, items B to F are met.
- After its stocks have been placed under an altered trading method pursuant to subparagraph 15 of the preceding paragraph, the dissolution proposal is further revoked by the board od directors or is not approved with a resolution at the shareholders meeting.
- After its stocks have been placed under an altered trading method pursuant to subparagraph 16 of the preceding paragraph, a special shareholders meeting has been held and re-election is completed.
- After its stocks have been placed under an altered trading method pursuant to subparagraph 17 of the preceding paragraph, correction or improvement has been made upon requpest of the TWSE.
Where the TWSE has placed the listed securities of a TIB listed company or a TIB primary listed company under an altered trading method, or has resumed the original trading method of its listed securities pursuant to the preceding paragraphs, the competent authority shall be informed of the change within one month after the implementation for recordation.
Article 49-1, subparagraphs 4 to 7 shall apply mutatis mutandis to TIB primary listed companies.
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