D-Link 2005 Annual Report Download - page 45
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D-LINK CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(Continued)
˙ Conversion period:
The bondholders may exercise their conversion right at any time during the period from
thirty days after the issuance date to thirty days before the maturity date, by converting
the bonds into a certificate for conversion of convertible bonds, and then converting the
certificate into common stock or GDRs.
˙ Conversion price:
The conversion price was 50 New Taiwan dollars per share when the bonds were issued.
On July 19, 2004, the conversion price was adjusted to 27.76 New Taiwan dollars per
share based on the prescribed formula.
˙ Redemption right:
The bondholders may redeem their bonds within the first thirty to sixty days of the first,
second, third and the fourth year after the issuance date, at a redemption price equal to
the par value of the bonds at such dates. If more than 90% of the bonds have been
converted to common stock or redeemed by bondholders, D-Link has the right to redeem
all the outstanding bonds at a redemption price equal to their par value.
As of December 31, 2004, convertible bonds amounting to $31,750 thousand had been
converted, and they were fully converted in 2005.
(3) The first issuance of domestic guaranteed straight bonds
˙ Par value: $600 million.
˙ Issue date: December 24, 2001.
˙ Issue price: at par value.
˙ Duration: three-years, maturing on December 24, 2004.
˙ Coupon rate: 2.65%, interest paid annually on December 24.
˙ Issue terms: The principal of the bonds will be fully paid at one time upon the maturity
of the bonds.
˙ Commitment: The bonds are guaranteed by Chiao Tung Bank. D-Link is committed to
maintain a current ratio (current assets/current liabilities) over 150% and a debt ratio
(liabilities /equities) lower than 100%. These financial ratios should be determined
based on D-Link’s audited financial statements.
On December 20, 2004, the bonds were fully retired.
Interest expense on bonds payable in 2005 and 2004 amounted to $0 thousand and $103,706
thousand, respectively.