Qisda : The Board resolved to issue overseas or domestic convertible bonds in private placement (“Private Placement CB”).

Close

Today's Information

Provided by: Qisda Corporation
SEQ_NO	3	Date of announcement	2022/03/07	Time of announcement	19:21:25
Subject	The Board resolved to issue overseas or domestic convertible bonds in private placement ("Private Placement CB").
Date of events	2022/03/07	To which item it meets	paragraph 11
Statement	1.Date of the board of directors resolution:2022/03/07 2.Name of the corporate bonds:private placement ("Private Placement CB"). 3.Total amount issued: It will be proposed that the shareholders meeting to authorize the Board, within the limit of 195,000,000 common shares and preferred shares, depending on the market conditions and the Company's capital needs, to choose appropriate timing and fund raising method(s), to issue new common shares for cash to sponsor DR Offering and/or issue new common shares for cash in public offering and/or issue new preferred shares for cash in public offering and/or issue Private Placement Shares and/or issue Private Placement CB, in accordance with the applicable laws and regulations and the principles of the above mentioned fund raicing instrument(s). For issuance of Private Placement CB, the number of common shares can be converted within the limit of 195,000,000 common shares shall be calculated in accordance with the conversion price determined at the time of issuance of Private Placement CB. 4.Face value per bond: The denomination of the Private Placement CB will be US$10,000 or multiples thereof or NT$100,000 or multiples thereof. 5.Issue price: The issue price shall be no less than 80% of the theoretical price. 6.Issuance period: The term of Private Placement CB shall not exceed seven years. 7.Coupon rate:To be determined by the Board. 8.Types, names, monetary values and stipulations of collaterals: NA 9.Use of the funds raised by the offering and utilization plan: To enrich working capital, strengthen financial structure, purchase of materials form oversea and/or support the Company's funding needs for long term development. 10.Trustees of the corporate bonds:NA 11.Guarantor(s) for the issuance:NA 12.Agent for payment of the principal and interest:NA 13.Sell-back conditions: The Issuer elect choose not to grant holders'put option, or after expiry of a designated period following issuance of the Private Placement CB, holders may require the Issuer to redeem all or part of the Private Placement CB at a price that would result in certain annual yield on the Private Placement CB. 14.Buyback conditions:To be determined by the Board. 15.Record date for any additional share exchange, stock swap, or subscription: NA 16.Possible dilution of equity in case of any additional share exchange, stock swap, or subscription:NA 17.For additional share exchange or subscription, possible influence of change in shareholding ratio of TWSE-listed common shares if all privately placed corporate bonds are converted and shares subscribed for (no.of TWSE -listed common shares (A), (A) / common shares issued):NA 18.Please explain any countermeasures for lower circulation in shareholding if the aforesaid estimated no.of TWSE-listed common shares does not reach 60 million and the ratio does not reach 25%:NA 19.Any other matters that need to be specified: (1)For the Private Placement Shares and/or the new common shares to be issued upon conversion of Private Placement CB, after expiration of three years following delivery date of the Private Placement Shares/Private Placement CB, the Board is authorized to apply for approval from the Taiwan Stock Exchange ("TWSE") acknowledging that the Private Placement Shares /new common shares to be issued upon conversion of Private Placement CB meet the requirements for TWSE listing before the Company submitting application with the Financial Supervisory Commission for retroactive handling of public issuance of such shares and submitting application with TWSE for listing such shares on TWSE. The Private Placement Shares and the new common shares to be issued upon conversion of Private Placement CB will have the same rights and obligations as the Company's existing issued and outstanding common shares. (2)The conversion price of the Private Placement CB shall be no less than 80% of (x) either the simple average closing price of the Issuer's common shares for 1, 3 or 5 trading days prior to the pricing date, after adjustment for shares issued as stock dividends, shares cancelled in connection with capital reduction and the cash dividends, or (y) the simple average closing price of the Issuer's common shares for 30 trading days prior to the pricing date, after adjustment for shares issued as stock dividends, shares cancelled in connection with capital reduction and the cash dividends. It is proposed for the shareholders meeting to authorize the Board to determine the actual conversion price in accordance with applicable rules and regulations. (3)The reason for the situation where the issue price of the new common shares to be issued to sponsor the DR Offering, the new common shares to be issued in public offering, the new preferred shares to be issued in public offering, Private Placement Shares and the conversion price for the Private Placement CB is set at a price less than the par value due to change of the market change and the reason for the Company not adopt other fund raising method and the reasonableness for such determination: This is mainly based on considerations of the sound operation of the Company and the security of its financial structure and issuing equity related securities for fund raising is more appropriate than pure debt financing. If the Company decides to use the fund raising methods, such as issuing new shares for cash to sponsor the DR Offering, issuing new common shares for cash in public offering, issuing new preferred shares for cash in public offering, and issuing Private Placement Shares, etc., the Company would not incur any interest of the debt in such case not only the Company's financial risk could be reduced, the Company's financial structure could be improved and the flexibility of the Company's treasury management would also be increased. For issuance of Private Placement CB, if investors convert Private Placement CB into the common shares, such would improve the Company's financial structure and would benefit the Company's long term development. Thus, it should be reasonable for the Company to issue the equity related securities. If the issue price and the conversion price is less than the par value, such would be expected to cause decrease of the Company's capital surplus and retained earnings in which case the Company will, depending on the actual operating conditions in the future, make up for the losses. As the issue price and conversion price will be determined in accordance with the relevant regulations, thus, after realization of the benefits of the capital increase, the Company's financial structure will be effectively improved which would be favorable to the Company's long-term development and would not have adverse impact on the rights and benefits of the shareholders.