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Announcement:Term Loan from HTC to Beats Electronics, LLC
1.Date of occurrence of the event:2012/07/20
2.Name of the company who receive the monetary loans, its relationship to the Company who extend the loans, ceiling amount on the monetary loans extended, amount of loans originally extended, amount of the current additional loans, whether or not the board of directors authorize the chairperson to give loans for the borrowing counterparty; total extended amount of loans and the reason for loans as of the date of occurrence of the event:
(1)Name of the company to which the loans have been extended: Beats Electronics, LLC (“Beats”)
(2)Its relationship to the Company: HTC has invested in Beats through its subsidiary, HTC America Holding, Inc.
(3)Ceiling on the loan amounts:NTD 20,322,266,000
(4)Amount of loans originally extended: None
(5)Amount of the current additional loans:USD225,000,000
(6)Reason for the current additional loans:Fulfill working capital requirement
3.Content and value of collaterals provided by the loan recipient, if any:
(1)Collaterals include all the assets of the Beats, including but not limited to accounts receivable, inventory, and IP.
(2)Content and value of collaterals: No less than USD 225,000,000
4.Capital and Accumulated profit/loss of the loan recipient according to its latest financial report:
(1)Capital of the loan recipient according to its latest financial report:N/A
(2)Accumulated profit of the loan recipient according to its latest financial report: USD 43,759,222 as of 12/31/2011
5.Method of calculation of interest:
3-month LIBOR+ 1.5% for months 1-3
3-month LIBOR+ 3.5% for months 4-6
3-month LIBOR+ 5.5% for months 7-9
3-month LIBOR+ 7.5% for months 10-12
6.Terms/conditions and date for repayment:
(1)Terms/conditions: Repayment can be made in full at anytime during the term of the loan or at the repayment date.
(2)Date for repayment:Term loan must be repaid in full no later than July 20, 2013.
7.The Company’s total amount of monetary loans extended as of the date of occurrence of the event:
NTD 6,965,140,000 (consists of a USD 225,000,000 disbursement and EUR 6,000,000 disbursement; the EUR 6,000,000 disbursement is an intercompany loan)
8.The ratio of the total amount of monetary loans extended to the Company’s net worth on its most recent financial statements as of the date of occurrence of the event:6.85%
9.Sources of funds to extend monetary loans to others:HTC Corporation
10.Any other matters that need to be specified:None