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Article 37
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When a securities firm enters into a contract for an equity derivatives transaction in TWSE listed or TPEx listed stocks, the number of the underlying shares that could potentially be exchanged upon exercise of the derivatives contract, plus the number of underlying shares that would be exchanged upon exercise of the previous business day's outstanding and unexpired call (put) warrants and contract-based call (put) warrants of all securities firms, leverage transaction merchants, and banks, may not exceed 15 percent of the total number of the underlying shares issued by the issuer after deduction of the shares set out in each of the following items:
- The total percentage of shares held by directors and supervisors under statutory shareholding ratio requirements.
- Pledged shares.
- The number of shares that newly TWSE listed or TPEx listed companies are required to place in compulsory central custody.
- Shares repurchased under the Regulations Governing Share Repurchase by TWSE Listed and TPEx Listed Companies, but not yet retired.
- Shares on which the competent authority has imposed restrictions for exchange or TPEx listing and trading.
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