D-Link 2001 Annual Report Download - page 50

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18
D-LINK CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements
Except for the rate of increase in future compensation levels as of December 31, 2001 is 3.00%, the
above-mentioned actuarial assumptions are also applicable to DTI.
14. Stockholders’ Equity
(1) Common stock
In 1998, D-Link issued 5 million Global Depository Receipts (“GDRs”). Each GDR represents 5
common shares and was offered at ten U.S. dollars and thirteen cents per GDR. Net proceeds of
approximately NT$1,674,042 were raised in September 1998. The GDRs are publicly listed on the
Luxembourg Stock Exchange. The capital increase was registered in October 1998.
Pursuant to a stockholders’ resolution on May 25, 2000, D-Link increased its common stock by
$534,413 through the transfer of capital surplus, unappropriated earnings and employee bonuses of
$232,769, $226,644 and $75,000, respectively. The capital increase was registered in June 2000.
Based on a resolution at the meeting of the board of directors held on June 28, 2000, D-Link issued
9,360,000 shares of common stock for cash at sixty-nine New Taiwan dollars per share. The capital
increase was concluded in October 2000.
Pursuant to a stockholders’ resolution on May 24, 2001, D-Link increased its common stock by
$661,270 through the transfer of capital surplus, unappropriated earnings and employee bonuses of
$378,847, $189,423 and $93,000, respectively. The capital increase was registered in June 2001.
As of December 31, 2000 and 2001, the authorized capital totaled $5,800,000 (including $1,000,000
authorized for the conversion of convertible bonds), and the issued capital amounted to $3,788,466
and $4,459,414, respectively. The par value of D-Link’ s common stock is ten New Taiwan dollars
per share.
(2) Capital surplus
Pursuant to the ROC Company Law, capital surplus can only be used to offset a deficit and cannot
be used to declare cash dividends. However, capital surplus derived from additional paid-in capital
and earnings from gifts received can be used to increase share capital if there is no accumulated
deficit. According to current SFC regulations, capitalization of capital surplus cannot exceed a rate
of ten percent and can be done only in years after the year in which such capital increase is
registered with the authorities.
(3) Distribution of earnings and dividends policy
After establishing the legal and special reserve, earnings may be distributed in the following order in
accordance with D-Link’ s articles of incorporation: 2% as remuneration to directors and supervisors
and 12.5% as employee bonuses. An additional reserve on certain earnings may also be retained.
The remaining earnings may be distributed as stockholders’ dividends.