Samsung 2007 Annual Report Download - page 114

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
continued
A domestic subsidiary of the Company, Samsung Card Co., Ltd. transferred certain eligible financial assets in accordance with the
Act on Asset Backed Securitization of the Republic of Korea to several financial institutions (“FIs”). The transfer is with recourse and
was completed through a Special Purpose Entity (“SPE”) issued securities. In the event of non-performance of those transferred
financial assets within certain measurement criteria noted in the transfer agreement, the Samsung Card is obliged to redeem the
issued securities.
The transfer of the financial assets has been recognized as a sale and accordingly, have been derecognized from the financial
statements. Total financial assets transferred amounted to ￦852,750 million for the year ended December 31, 2007 (2006:
￦1,448,439 million). As of December 31, 2007, ￦4,037,885 million (2006: ￦4,002,923 million) remain uncollected and
outstanding with the financial institutions.
19. CAPITAL STOCK
Under its Articles of Incorporation, SEC is authorized to issue 500 million shares of capital stock with a par value of ￦5,000 per share,
of which 100 million shares are cumulative, participating preferred stock that are non-voting and entitled to a minimum cash dividend
at 9% of par value. In addition, SEC is authorized to issue to investors, other than current shareholders, convertible debentures and
debentures with warrants with face values up to ￦4,000 billion and ￦2,000 billion, respectively. The convertible debentures amounting
to ￦3,000 billion and ￦1,000 billion are assigned to common stock and preferred stock, respectively. While the debentures with
warrants amounting to ￦1,500 billion and ￦500 billion are assigned to common stock and preferred stock, respectively.
SEC is also authorized, subject to the Board of Directors’ approval, to issue shares of common or preferred stock to investors other than
current shareholders for issuance of depository receipts, general public subscription, urgent financing with financial institutions, and
strategic alliance.
SEC is authorized, subject to the Board of Directors’ approval, to retire treasury stock in accordance with applicable laws up to the
maximum amount of certain undistributed earnings. As of December 31, 2007, the 8,310,000 shares of common stock and 1,060,000
shares of non-voting preferred stock had been retired over three trenches, with the Board of Directors’ approval.
SEC has issued global depositary receipts (“GDR”), representing certain shares of non-voting preferred stock and common stock, at
overseas stock markets, are as follows:
In addition to the above issuances, there have been several conversions of foreign currency convertible bonds into GDRs and
conversions of the issued GDRs into original shares of common stock or non-voting preferred stock.
As of December 31, 2007, SEC’s outstanding global depositary receipts, as follows:
As of December 31, 2007, exclusive of retired stocks, 147,299,337 shares of common stock and 22,833,427 shares of preferred stock
have been issued. The preferred shares, which are non-cumulative and non-voting, were all issued on or before February 28, 1997, and
are entitled to an additional cash dividend of 1% of par value over common stock.
The par value of capital stock differs from paid-in capital as the retirement of capital stock was recorded as a deduction from retained
earnings.
Non-voting preferred stock 7,695,272 15,390,544
Common stock 4,251,339 8,502,678
Number of Shares of Stock Number of Shares of GDR
(N)
Non-voting preferred stock 3,459,872 6,919,744
Common stock 10,629,358 21,258,716
Number of Shares of Stock Number of Shares of GDR