Letter To Shareholders - Mitac

ank transfer.
11. Converting price and price adjustment
(1) Converting price
The price of the convertible bond is based on the cutoff date of July 28, 2005.The
converting price (rounded up to the first decimal of New Taiwan Dollar) of the
Company’s convertible bond is based on the average closing price of the Company’s
common stock on the prior business day, prior three business days, or on the prior five
business days by 112% converting premium rate. For any Ex-right and Ex-dividend
enforced before the cutoff date, the sampled closing price for calculating the converting
price must be translated to the Ex-right or Ex-dividend price. If there is any Ex-right or
Ex-dividend enforced after determining the converting price and before the issuance
date, the converting price is to be adjusted accordingly. The bond converting price is
NT$48 per share.
(2) Converting price adjustment
1) Except for the Company’s marketable securities with debt-for-equity SWAP or stock
option exchanged for common stock and private marketable security, upon the
issuance of the converting bond by the Company, converting price is to be adjusted
according to the following equation (rounded up to the first decimal of New Taiwan
Dollars) while there is additional common stock shares issued (recapitalization of
cash, surplus, additional paid-in capital, employee’s bonus, issuing new stock shares
for merger or accepting stock shares of another company, stock split and
recapitalization of cash for attending global depository receipt) by the Company; also,
please contact GreTai Securities Market (referred to as “GreTai” hereinafter) to have
the converting price announced and adjusted on the Ex-right cut-off date for new
bonus shares:
Converting price
before × Outstanding Proceeds
Adjusted
stock shares + collected per
converting price = adjustment
share
Outstanding stock shares+new bonus shares
×
New bonus
shared
Note 1: The outstanding shares are the net of the Treasury stock shares that are not
yet cancelled or transferred.
Note 2: The proceeds collected per share are zero for stock dividend or stock split.
Note 3: The proceeds collected per share of the new bonus shares recapitalization of
merger is the certified net worth per share of the discontinued company
before the merger cutoff date by SWAP ratio. The proceeds collected per
share of the new bonus shares for the shares accepted from the other
company are the certified or reviewed net worth per share of the said
company by SWAP ratio.
Note 4: If the price of new bonus shares is adjusted on the Ex-right cut-off date of the
recapitalization of cash, it is to be adjusted according to the updated new
bonus share price and the aforementioned equation. If the updated
converting price is lower than the converting price announced prior to the
Ex-right cut-off date, please contact the GreTai to have the updated
converting price announced.
Note 5: If it is a recapitalization of merger, the converting price is to be adjusted on
the merger cut-off date. If it is a recapitalization of stock split, the
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