Asus 2012 Annual Report Download - page 144

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A. The Company issued the redeemable domestic unsecured convertible bonds on November 7,
2006. The main issuance terms are as follows:
(A) Total amount of the convertible bonds at issuance: $12,000,000
(B) Nominal rate: 0%
(C) Duration of issuance: 5 years (from November 7, 2006 to November 7, 2011)
(D) Conversion period: Each bondholder has the right to convert all or from time to time any
portion of its convertible bonds into common shares during the conversion period (up to
31 days after the original issue date to 10 days before the maturity date).
(E) Conversion price and adjustment: The conversion price is $105.4 (in dollars) per common
share initially. The conversion price will be adjusted upon the occurrence of an increase in
the number of common shares. On July 14, 2011, the Company adjusted further the
conversion price to $269.2 (in dollars), considering the effect of capitalization from
retained earnings.
(F) Call option: The Company could redeem the convertible bonds at par value at any time
during the period from December 8, 2006 to September 28, 2011, under the following
conditions: the closing price of the common shares on each of 30 consecutive trading days
reaches or exceeds 50% of the conversion price, or the outstanding balance of the bonds is
less than 10% of the original issuance.
(G) Put option: Each bondholder has the right to put the convertible bonds at par value after
the 3rd and 4th year.
B. The fair value of non-equity convertible options, put options, call options and resetting options
embedded in bonds payable was separated from bonds payable, and was recognized in
“Financial assets or liabilities at fair value through profit or loss” in accordance with SFAS No.
34.
C. Except for some bonds which had been converted, all bonds of the Company had matured and
been redeemed on November 7, 2011.
(12) Pension
A. Effective from 1995, the Company adopted SFAS No. 18, “Accounting for Pensions”. The
funding status of the pension plan as of December 31, 1995 was measured on an actuarial
basis. In accordance with SFAS No. 18, net pension cost was recognized from January 1, 1996.
Because the accrued pension liability was equal to the funding status of the pension plan, no
unrecognized transitional net assets or net obligations shall be amortized in the future. In
addition, except for a few foreign employees, the Company had settled its financial obligations
to its employees under the pension plan accounted for based on SFAS No. 18 at December 31,
2007.
2012/1/1~12/31 2011/1/1~12/31
Gain on valuation of financial liabilities- -$ 104,525$
call/put option and conversion rights
Interest expense -$ 47,091$