104 - AGM Information 2019 | FinancialReports.eu

104 Corporation Table of Contents

Meeting Procedure ............................................................................................................................. 1 Meeting Agenda .................................................................................................................................. 3 I. Matters for Report ............................................................................................................... 5 1.2018 Business Report. ......................................................................................................... 5 2.Supervisor’s Review Report on the 2018 Financial Statements. ........................................ 5 3.The Report of the 2018 Employees, Directors and Supervisors’ Compensation. ............... 5 II. Matters for Ratification ....................................................................................................... 5 1. Adoption of the 2018 Business Report and Financial Statements. .................................... 5 2. Adoption of the Proposal for Distribution of 2018 Earnings. ............................................ 5 III. Matters for Discussion ......................................................................................................... 6 1.Amendment to the Company’s “Articles of Incorporation”. .............................................. 6 2. Amendment to the Company’s “Rules and Procedures of Shareholders’ Meetings”. ....... 6 3. Amendment to the Company’s “Directors and Supervisors Election Guidelines”. ........... 6 4. Amendment to the Company’s “Procedure for Acquisition and Disposal of Assets”........ 6 5. Amendment to the Company’s “Procedure for Loaning of Funds and Making of Endorsements/Guarantees”. ............................................................................................... 6 IV. Extemporary Motions .......................................................................................................... 6 V. Adjournment ......................................................................................................................... 6 Attachment .......................................................................................................................................... 7 1. 2018 Business Report ............................................................................................................. 8 2. Supervisor’s Review Report ................................................................................................. 13 3. Independent Auditors’ Report and Financial Statements ..................................................... 14 4. Earnings Distribution Proposal ............................................................................................ 30 5. Comparison Table of the “Articles of Incorporation” Amendments .................................... 31 6. Comparison Table of the “Rules and Procedures of Shareholders’ Meetings” Amendments ........................................................................................................................ 35 7. Comparison Table of the “Directors and Supervisors Election Guidelines” Amendments . 37 8. Comparison Table of the “Procedure for Acquisition and Disposal of Assets” Amendments ........................................................................................................................ 40 9. Comparison Table of the “Procedure for Loaning of Funds and Making of Endorsements/Guarantees” Amendments ............................................................................ 58 Appendix ........................................................................................................................................... 64 1. Rules and Procedures of Shareholders’ Meetings (Before Amendments) ........................... 65 2. Articles of Incorporation (Before Amendments) ................................................................. 68 3. Directors and Supervisors Election Guidelines (Before Amendments) ............................... 74 4. Procedure for Acquisition and Disposal of Assets (Before Amendments) ........................... 76 5. Procedure for Loaning of Funds and Making of Endorsements/Guarantees (Before Amendments) ....................................................................................................................... 88 6. Shareholdings of Directors and Supervisors ........................................................................ 94

Meeting Procedure

104 Corporation

2019 Annual Shareholders’ Meeting Procedure

I. Call Meeting to Order
II. Chairman’s Address
III. Matters for Report
IV. Matters for Ratification
V. Matters for Discussion
VI. Extemporary Motions
VII. Adjournment

Meeting Agenda

104 Corporation

2019 Annual Shareholders ’ Meeting Agenda

Time ： 9:00 a.m., May 29, 2019

Place `：` 104 Corporation Headquarters

(3F, No.119 BaoZhong Rd., Xindian Dist., New Taipei City, Taiwan, (R.O.C.))

I. Call Meeting to Order
II. Chairman’s Address
III. Matters for Report
2018 Business Report.
Supervisor’s Review Report on the 2018 Financial Statements.
The Report of the 2018 Employees, Directors and Supervisors’ Compensation.
IV. Matters for Ratification
Adoption of the 2018 Business Report and Financial Statements.
Adoption of the Proposal for Distribution of 2018 Earnings.
V. Matters for Discussion
Amendment to the Company’s “Articles of Incorporation”.
Amendment to the Company’s “Rules and Procedures of Shareholders’ Meetings”.
Amendment to the Company’s “Directors and Supervisors Election Guidelines”. 4. Amendment to the Company’s “Procedure for Acquisition and Disposal of Assets”.
Amendment to the Company’s “Procedure for Loaning of Funds and Making of Endorsements/Guarantees”.

VI. Extemporary Motions

VII. Adjournment

I. Matters for Report

1. 2018 Business Report.

Explanatory Notes ：

For the Company’s 2018 Business Report, please refer to attachment 1 on Pages 8 to 12.

2. Supervisor’s Review Report on the 2018 Financial Statements.

Explanatory Notes ：

For the Supervisor’s Review Report, please refer to attachment 2 on Page 13.

3. The Report of the 2018 Employees, Directors and Supervisors’ Compensation. Explanatory Notes ：

(1) Pursuant to Article 26 of the Company’s Articles of Incorporation.
(2) Income before tax excluding employees, directors and Supervisors’ compensation in 2018 is NT$384,706,711. Based on the resolution of the Board of Directors, cash will be distributed to the employees, directors and supervisors’ compensation are NT$31,738,304 and NT$7,694,134, respectively. There is no difference between the above resolution and those recognized in the financial statements.

II. Matters for Ratification

1. Adoption of the 2018 Business Report and Financial Statements. (Proposed by the Board of Directors)

Explanatory Notes ：

(1) The Company’s 2018 financial statements have been approved by the Board of Directors and audited by KPMG.
(2) Please refer to attachment 1 on Pages 8 to 12 and attachment 3 on Pages 14 to 29.

Resolution ：

2. Adoption of the Proposal for Distribution of 2018 Earnings. (Proposed by the Board of Directors)

Explanatory Notes ：

(1) The Company’s net income after tax in 2018 is NT$282,207,001. For the Earnings Distribution Proposal, please refer to attachment 4 on Page 30.
(2) Article 66-9 of the Income Tax Act is applicable to the calculation of the earnings distribution proposal mentioned in the preceding paragraph. The 2018 earnings will be distributed first. If such earnings are insufficient, the earnings for the past years will be distributed in sequence.
(3) The proposal is to distribute a cash dividend of NT$8.51 per share, totaling NT$282,461,367. After the proposal is approved by the annual shareholders’ meeting, the Board of Directors authorized to determine the ex-dividend date. Cash dividends shall be based on the distribution ratio and rounded down to the integer. Fractional dividend amounts that are less than NT$1 shall be summed up and recognized as other income of the Company. In case the number of the Company’s outstanding shares is affected from changes to the laws, adjustments by the competent authority, repurchase or cancellation of the Company’s treasury shares, or other possible situations which may lead to the changes in the shareholder dividend ratio, it is proposed to the shareholder’s meeting to authorize the Board of Directors to adjust it.

Resolution ：

III. Matters for Discussion

1. Amendment to the Company’s “Articles of Incorporation”. (Proposed by the Board of Directors)

Explanatory Notes ：

In accordance with the No.10700083291 issued by the President on August 1, 2018, the proposal is to amend partial provisions of the Company’s “Articles of Incorporation”. For the comparison table of the amendments, please refer to attachment 5 on Pages 31 to 34.

Resolution ：

2. Amendment to the Company’s “Rules and Procedures of Shareholders’ Meetings”. (Proposed by the Board of Directors) Explanatory Notes：

In accordance with the No.10700083291 issued by the President on August 1, 2018, the proposal is to amend partial provisions of the Company’s “Rules and Procedures of Shareholders’ Meetings”. For the comparison table of the amendments, please refer to attachment 6 on Pages 35 to 36.

Resolution ：

3. Amendment to the Company’s “Directors and Supervisors Election Guidelines”. (Proposed by the Board of Directors)

Explanatory Notes ：

In accordance with the No.10700083291 issued by the President on August 1, 2018, the proposal is to amend partial provisions of the Company’s “Directors and Supervisors Election Guidelines”. For the comparison table of the amendments, please refer to attachment 7 on Pages 37 to 39.

Resolution ：

4. Amendment to the Company’s “Procedure for Acquisition and Disposal of Assets”. (Proposed by the Board of Directors) Explanatory Notes ：

In accordance with the No.10703410725 issued by the Financial Supervisory Commission on November 26, 2018, the proposal is to amend partial provisions of the Company’s “Procedure for Acquisition and Disposal of Assets”. For the comparison table of the amendments, please refer to attachment 8 on Pages 40 to 57.

Resolution ：

5. Amendment to the Company’s “Procedure for Loaning of Funds and Making of Endorsements/Guarantees”. (Proposed by the Board of Directors) Explanatory Notes ：

In accordance with the No.1080304826 issued by the Financial Supervisory Commission on March 7, 2019, the proposal is to amend partial provisions of the Company’s “Procedure for Loaning of Funds and Making of Endorsements/Guarantees”. For the comparison table of the amendments, please refer to attachment 9 on Pages 58 to 63.

Resolution ：

IV. Extemporary Motions

V. Adjournment

Attachment

Attachment 1: 2018 Business Report

104 Corporation Business Report

I. 2018 Business Report

1. Achievements of the implementation of the operational plan

In order to implement the three major missions of management, i.e. “commitment to career matchmaking, commitment to the elderly, and commitment to children”, 104 continued to develop its service models in 2018, including:

(1) Career Mission

1. Personal Job-Seeking Service: 104 continued to improve the efficiency of personal job seeking, and in 2018 it had launched a new version of job recommendation, smart job-sorting list, and a career and personality match indicator to assist job selection. These intend to make job-seeking service more accurate, fast and effective. In addition, to continuously improve product usability, the Company completed the revision of PC web front page, PC and Mobile Web job listing and simplified the membership registration process in 2018. Also, the APP had been launched to provide job seekers an online one-to-one real-time resume consulting service for free.

2. Enterprise Talent-Seeking Service: 104 continued to improve the efficiency of enterprise talent-seeking service. In 2018, new version of talent recommendation, smart talent-sorting list, and a career and personality match indicator to assist talent selection were launched. These intend to make talent-seeking service can be more accurate, fast and effective. In addition, to continuously improve product usability, the Company completed the revision of PC Web talentseeking front pate in 2018, and launched 24/7 customer service robots, which provided more real-time online response for customers’ problems.

3. Human Resource Management Platform: “eHRMS” system provided flexible setting to assist enterprises to deal with complex demands such as personnel attendance, payroll calculation and payroll approvals. A HR self-service platform had been established via HR Portal that provides educational training, resource management and benefits-subsidy module, and an all-round HR management system for HR department.

“Assessment Expert” provided accurate and diversified talent evaluation tools that catered to various needs of different positions and assessment goals in the mainland China, Taiwan and Hong Kong. Consulting service had been integrated to provide a more scientific and objective perspective that helps enterprises understand organization and individual training demand. Through this approach, enterprises can be assisted to conduct organization diagnosis and development planning so they can reasonably allocate, stimulate and accumulate talents to implement management strategy and organization’s goals.
“HR Portal” provided cloud management platform for human resource departments in SMEs. SMEs can easily manage personnel, enhance professionalism, and collaborate with personnel to make better communication through this platform. The supervisors were able to increase work efficiency by making decisions and management in mobile form.

4. 104 Nabi Career Learning Service: For job seekers, 104 aims to achieve the goal of “not just finding a job, but also find a direction for you.” Based on enterprises talent demand which build a personalized competitiveness analysis, 104 Nabi assists novices to find their career directions through 104 big data analysis. Actual learning resources have been provided to improve novices’ career competitiveness and cultivate talents for enterprises.

5. Executive Recruiting Service: Head hunting team continued to engage in the key talents and middle-and-high executives’ market. According to current industrial development in Taiwan, 45% of cases were technology industry, 55% of cases were non-technology industry. Deals covered listed companies, foreign companies, SMEs and overseas clients. Due to the globalized layout for Taiwanese enterprises and talents, 30% of talents worked oversea. In customer satisfaction investigation, both customers and candidates’ satisfaction rate reached 95%. In annual servicing quality evaluation in Employment Agency for Ministry of Labor, the Company earned a score of 99 (Grade A) in this year.

(2) Elderly Mission

1. Senior Care Bank Matchmaking Platform: The Company continued to promote the concept of health promotion and disease prevention. The health promotion service demand test was completed in February 2018. In the meantime, the Company officially launched Coach Caregiver service for self-supporting care in October to protect the dignity of disabled seniors. The Coach Caregivers provide in-house care service. By careful observation, seniors’ physical condition, living style and environment can be well understood. After the service, a comprehensive care service plan would be provided that combine project management and opinions from medical professionals (physicians, registered nurse, functional therapists, physiotherapists, and dietitians). In the service, except providing an actual care to the seniors, the caregiver would be trained on how to take care of the seniors. Optimized evaluation would be carried out in the first month as a reference for plan adjustment. After three months of service. a final service report will be provided to assist the costumers and seniors understand the improvement and follow-up care.

Senior Care Bank fulfilled caregiver’s heartfelt wishes by inviting medical professionals and Coach Caregivers to establish professional help center and providing correct concept of inhouse care to help the seniors self-supporting recovery. Senior Care Bank went online in December. Except referring to the F&Q, the seniors can also ask questions anytime they want. Personalized advices will be responded by medical professionals and Coach Caregivers.

2. Senior Platform: A platform that takes the value of healthy elders as its mission. Retired people can provide paid services for demanders to sign up and participate on the platform. Retired people can provide guiding, cooking, creative arts and consulting service in 2018. one hundred retired people had registered, and seven hundred senior services had been listed online. More than five thousand users paid for those services. 104 also expanded the era memory program and senior nostalgic program by gathering map in seniors’ memories around Taiwan as an inheritance of land memories. Ancient inheritance activities had been held to collect the old memories from the seniors. In addition, the Company provided seniors work units, let the recruitment companies provide job opportunities to the seniors. More senior working partners will be recruited.

(3) Children Mission

World of Work and Star Platform: To fulfill the goal of “explore talents in every child”, 104 offered Star Platform to explore talents in children and World of Work Platform had been established for children talent exploration. In 2018, 19,059 middle school students registered on World of Work Platform. 11,839 students completed self-exploration on the self-discovery game and obtained career exploration certification. Furthermore, we held voluntary experience sharing seminar in 95 schools, where 14,000 students can hear career story shared by 200 volunteers. The Star Platform officially launched in August 2018. As of the end of the year, a total of 2,540 members had been participated, and nine children talent exploration games were held with 1,060 attendance and 1,840 works accumulated.

2. Financial Performance

The consolidated revenue for 2018 was NT$1,577,612 thousand, up 2% from the consolidated revenue of NT$1,539,995 thousand for 2017. The consolidated net income for 2018 was NT$323,109 thousand down 10% from the consolidated operating income of NT$358,159 thousand for 2017. The consolidated net income for 2018 was NT$282,083 thousand, down 11% from the consolidated net income of NT$318,663 thousand for 2017. The decreases of net income were mainly affected by the increase in operating expenses for optimizing existing services and accelerating new product development, as well as by the increase in income tax expenses caused by the raised corporate income tax rate accordingly.

tax rate accordingly.	tax rate accordingly.	tax rate accordingly.
Unit: NT$1,000
Consolidated Income Statement	2018	2017
Operatingrevenue	1,577,612	1,539,995
Operatingincome	323,109	358,159
Net income before tax	352,055	381,785
Income tax expense	69,972	63,122
Net income	282,083	318,663
Return on assets(%)	12	14

Return on shareholders’ equity (%)	19	21

Pre-tax income topaid-in capital(%)	106	115

Net margin(%)	18	21
Basic EPS(after Tax) (NT$)	8.51	9.60

3. Research and Development Results

The successful technologies or products developed in 2018 include:

(1) Recommended matchmaking using machine learning algorithm: A self-developed word segmentation system had been incorporated to analyze the cloud job/resume database of 104 Job Bank. It filtered job resumes and knowledge established by users. Feature information used by recommendation function was expanded by extracting potential natural language information. Machine learning algorithms were thus developed based on collective intelligence. Recommended situations and abilities were added to enhance user experience and produced information for future product and function, benefiting to new AI app development.
(2) AI evaluation and the conformity match of resume and job: The Company developed resume information extraction technology based on users’ footprints record stored in the job bank service. The technology will turn potential information into the conformity match of resume and job. The information can be continuously adjusted based on user behavior and input. Therefore, current market expectations and information on the current status can be provided. Various information to both job and talent seekers can be offered to assist them to make a more confident choice.
(3) HR Portal-Assessment Center: Phase 1 development of Assessment Center had been completed. Personality inventory access had been provided to job seekers and enterprises. Job seekers can use personality inventory to make a self-exploration. Enterprises can use personality inventory to make an efficiency selection. It also provides an accurate conformity match to both sides.
(4) New generation of HR management systems had been completed. Personnel, attendance, and scheduling, and form module were developed. The open-source software can help enterprises reduce software royalty. Enterprises won’t hesitate to invest HR software and purchase large modules in the future.

(5) The Company continued to optimize Be A Giver community platform, added an online consultation service in the Career Clinics, provided service to middle- and high-level executives. All head hunters gathered job interview database, organized autonomous robot and machine learning technology to extend service to more job seekers.
(6) The Coach Caregivers Matchmaking Platform: The core value of “104 Senior bank Coach Caregiver care program recommendation system” is the big data analysis and AI learning, which includes long-term care record database, smart care planning dictionary algorithm technology, health care dictionary recommendation system. The purpose is to turn clinical knowledge into health care advice that Coach Caregivers needed. Prediction of continuous optimization during iterative learning process has been provided, making an accurate in-house self-supporting draft when Coach Caregivers facing difference situations.

II. The Company’s Development Strategies and Future Prospects

1. The Company’s Development Strategies

In terms of Job Bank, we will continue to add new users and deepen service to enhance user loyalty in order to increase job seeking and recruitment market share and expand the external network. The Company will leverage our advantages in active user scale to develop product applications based on user’s profile, behavior and interaction data. The Company will continue to enhance the job/talent seeking bilateral recommendation, smart sorting and suitability matching service in professional and personality. By establishing a competitive and quantitative competition and implementing the usercentric design concept, we will continue to enhance product usability and bring our users better experience.

Due to China-US trade war, Taiwanese entrepreneurs are expected to accelerate the global presence. The head hunting team will be more focused on the recruitment of expatriate executives, extending business in the mainland China. The Company will recruit head hunters in Shanghai to provide head hunting service to Taiwanese and local entrepreneurs, and duplicate successful experiences to the China market. Head hunters’ efficiency and performance will be enhanced by updating head hunter platform, providing more accurate and convenient hunting function and case management system. The Company will also develop consulting robots to gain competitive advantages in head hunting area.

There are two HR managing development strategies in 2019. First, multiple modules data connection increase the convenience of employee management. For example, HR module integrates employee evaluations; salary module integrates employees’ salary survey, etc. Secondly, data integration. Due to data distributed in different modules, there’s a difficulty to analyze and integrate them. The Company will develop decision center module, help administrators contain a whole picture of HR statement, and provide administration advices through HR big data analysis.

In 2019, the development of the Senior Care Bank industry will be focused on six major aspects: The Company will complete diversified market demand tests for the Coach Caregivers’ services, enhance the consumer loyalty to professional help center, and increase brand awareness of Senior Care Bank. Senior Care Bank gradually establishes service process of the matchmaking platform, including customers and Coach Caregivers function, and continues to recruit Coach Caregivers. The Company makes vigorous effort to implement supporting measures related business model, including self-supporting dictionary, self-supporting video, etc. It is expected that 104 can build up high quality service value for the industry.

2. Future Prospects

Looking forward to the new year, based on C.M.O.S.(cloud, mobile, open, social) concept, 104 will combine AI, big data and the existing foundation of human resources, and continue to optimize a broader service and deeper demands, increase market share, and expand the Company’s influence on the foundation of information security to become the leading brand of human resources in Chinese community.

In response to the trend of aging population and declining birth rates, we have expanded our service coverage to the seniors and children. In the future year, the Company will continue to leverage the value of the seniors, protect the dignity of the elderly, help each child to find their gift, and help to alleviate the impact of manpower supply shortage.

Furthermore, we will lead our teams to work together, as the highest standards of conduct with the aim of sustainable development, fulfill our social responsibilities, create a long-term working environment for our employee, provide more valuable services to our customers, and look forward to continuously creating maximum value for our shareholders, customers, employees and all stakeholders.

Chairman: Rocky Yang

General Manager: Rocky Yang

Chief Accountant: Tiffany Lin

Attachment 2: Supervisor’s Review Report

104 Corporation Supervisor’s Review Report

The Board of Directors has prepared the 2018 Business Report, Financial Statements, and Earnings Distribution Proposal. Of which, the financial statements have been audited by CPAs Min-Ju Chao and Lily Lu of KPMG, and an audit report with unqualified opinion was issued. The aforementioned statements have been reviewed and determined to be correct and accurate by the supervisors. The Report is submitted in accordance with Article 219 of the Company Act.

2019 annual shareholders’ meeting of 104 Corporation

Supervisor: Askforce Corporation Representative: Mei-Fang Hsu

Supervisor: Zan-Syong Cai

March 13, 2019

Attachment 3: Independent Auditors’ Report and Financial Statements

Independent Auditors’ Report

To the Board of Directors of 104 Corporation:

Opinion

We have audited the financial statements of 104 Corporation ("the Company"), which comprise the balance sheets as of December 31, 2018 and 2017, the statements of comprehensive income, changes in equity and cash flows for the years ended December 31, 2018 and 2017, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as at December 31, 2018 and 2017, and its financial performance and its cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

We conducted our audit in accordance with the "Regulations Governing Auditing and Certification of Financial Statements by Certified Public Accountants" and the auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the Certified Public Accountants Code of Professional Ethics in Republic of China ("the Code"), and we have fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis of our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements taken as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Based on our judgement, the key audit matters that should be communicated in this audit report are as follows:

Revenue recognition

Please refer to note 4(12) for accounting policy related to revenue recognition, and note 6(13) for the disclosure related to revenue from contracts with customers of the financial statements.

Description of key audit matter:

The Company’s operating revenues is the main indicator for investors and management to assess their financial or business performance. Since the Company is a listed company, it has a high risk of false representation. Furthermore, in 2018, the Company is required to adopt the International Financial Reporting Standard No. 15 for the first time, wherein its recognition of revenue and its judgment of the timing of the transfer of commodity control rights are extremely important for the expression of its financial statements. The Company’s operating revenues mainly derive from providing online advertising and consulting services, wherein they are recognized in the following different ways. Additionally, the Company often received its payments in advance after the contracts are signed; therefore, the amount is deferred according to the Company’s policy and recognized as revenue once the service is performed. The aforementioned matter is the basis for the Company’s management to determine the amount of revenue that can be recognized, therefore, revenue recognition was considered to be one of the key audit matters in our audit.

How the matter was addressed in our audit:

Our audit procedures included:

‧ Assessing and testing the design, as well as the effectiveness of the operating on the control over sales and collection cycle. Selecting appropriate samples and comparing them to relevant documents such as customer order and confirmation of completion order signed by customer to assess whether revenue and deferred revenue have been appropriately recognized.
‧ Performing comparison analysis on operating revenue of the current period to last period and the latest quarter to assess the existence of any significant exceptions, and further identify and analyze the reasons, if there is any significant exception.
‧ Performing test-of-detail on operating revenue to assess the assertions of existence and accuracy, as well as the appropriateness of recognition.
‧ Examining relevant documents of a period before and after the balance sheets date, such as customer order, information reported back from business department, or confirmation of completion of duty executed by customer, and verify the accuracy of the amount recognized as revenue in accordance with the timing of service provided or quantity provided to determine whether the deferred revenue should not be recognized as revenue and whether operating revenue has been appropriately recognized.

Responsibilities of Management and Those Charged with Governance for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with Regulations Governing the Preparation of Financial Reports by Securities Issuers and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company’s financial reporting process.

Auditors’ Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the auditing standards generally accepted in the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with auditing standards generally accepted in the Republic of China, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the financial statements whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient and appropriate audit evidence regarding the financial information of the investments in other entities accounted for using the equity method to express an opinion on the financial statements. We are responsible for the direction, supervision and performance of the Company audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partners on the audit resulting in this independent auditors’ report are Min-Ju Chao and Lily Lu.

KPMG

Taipei, Taiwan (Republic of China) March 13, 2019

Note to Readers

The accompanying financial statements are intended only to present the statement of financial position, financial performance and cash flows in accordance with the accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to audit such financial statements are those generally accepted and applied in the Republic of China.

The independent auditors’ report and the accompanying financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ report and financial statements, the Chinese version shall prevail.

(English Translation of Financial Statements and Report Originally Issued in Chinese) 104 CORPORATION

Balance Sheets

December 31, 2018 and 2017

(Expressed in Thousands of New Taiwan Dollars)

Assets Current assets: Cash and cash equivalents (note 6(1)) Notes receivable, net (note 6(3)) Accounts receivable, net (notes 6(3), (13) and 7) Other receivables (note 7) Other financial assets－current (note 8) Other current assets Total current assets Non-current assets: Financial assets at fair value through profit or loss－non-current (note 6(2)) Investments accounted for using equity method (note 6(4)) Property, plant and equipment (note 6(5)) Intangible assets (note 6(6)) Deferred tax assets (note 6(9)) Prepayments for equipment Refundable deposits Other financial assets－non-current (note 8) Total non-current assets Total assets	December 31, 2018 Amount % $ 1,961,227 81 565 - 47,524 2 22,194 1 150 - 14,519 1 2,046,179 85 4,914 - 101,845 5 243,763 10 3,514 - 5,673 - 1,594 - 5,998 - 10,000 - 377,301 15 $ 2,423,480 100	Liabilities and Equity Current liabilities: Contract liability－current (note 6(13)) Notes payable Accounts payable Other payables (notes 6(15) and 7) Current tax liabilities Deferred revenue (note 6(14)) Other current liabilities Total current liabilities Non-current liabilities: Net defined benefit liability (note 6(8)) Total non-current liabilities Total liabilities Equity attributable to owners of parent (notes 6(8), (9), (10) and (11)) Common stock Capital surplus Retained earnings: Legal reserve Special reserve Unappropriated earnings Total retained earnings Other equity: Foreign currency translation differences for foreign operations Others Total other equity Total equity Total liabilities and equity December 31, 2017 Amount % 1,917,721 82 1,196 - 35,974 2 9,948 - - - 13,461 1 1,978,300 85 - - 117,698 6 206,451 9 6,705 - 4,731 - - - 5,498 - 10,000 - 351,083 15 2,329,383 100	December 31, 2018		December 31, 2017
			Amount % $ 442,143 18 395 - 6,018 - 365,414 15 61,862 3 - - 48,787 2 924,619 38 5,666 - 5,666 - 930,285 38 331,917 14 397,859 16 378,199 16 2,941 - 386,934 16 768,074 32 (4,051 ) - (604) - (4,655) - 1,493,195 62 $ 2,423,480 100		Amount % - - 2 - 6,920 - 319,382 14 41,094 2 386,006 16 42,550 2 795,954 34 7,213 - 7,213 - 803,167 34 332,072 14 399,549 17 378,199 17 - - 422,717 18 800,916 35 (2,941 ) - (3,380 ) - (6,321) - 1,526,216 66 2,329,383 100

See accompanying notes to financial statements.

(English Translation of Financial Statements and Report Originally Issued in Chinese) 104 CORPORATION

Statements of Comprehensive Income

For the years ended December 31, 2018 and 2017

(Expressed in Thousands of New Taiwan Dollars, Except for Earnings Per Common Share)

Operating revenue (notes 6(13), (14) and 7) Operating costs (notes 6(5), (6), (7), (8), (10), (11), (15) and 7) Gross profit Operating expenses (notes 6(3), (5), (6), (7), (8), (10), (11), (15) and 7): Selling expenses Administrative expenses Research and development expenses Total operating expenses Operating income Non-operating income and expenses (notes 6(16), (17) and 7): Other income Other gains and losses Share of profit or loss of subsidiaries, associates and joint ventures accounted for using equity method Total non-operating income and expenses Income before income tax Less: income tax expenses (note 6(9)) Net income Other comprehensive income (loss): Items that will not be reclassified subsequently to profit or loss (notes 6(8) and (9)) Remeasurements from defined benefit plans Income tax related to items that will not be reclassified subsequently to profit or loss Total items that will not be reclassified subsequently to profit or loss Items that may be reclassified subsequently to profit or loss Foreign currency translation differences for foreign operations Income tax related to items that are or may be reclassified subsequently to profit or loss Total items that may be reclassified subsequently to profit or loss Other comprehensive loss Total comprehensive income Basic earnings per share (note 6(12)) Basic earnings per share Diluted earnings per share	2018	% 100 10 90 39 11 21 71 19 2 - 1 3 22 4 18 - - - - - - - 18 8.51 8.44	2017
	Amount $1,552,514 158,319 1,394,195 612,922 168,845 322,846 1,104,613 289,582 32,555 63 23,074 55,692 345,274 63,067 282,207 245 34 279 ( 1,110 ) - ( 1,110) ( 831) $ 281,376 $ $		Amount 1,512,766 149,553 1,363,213 569,766 177,722 298,062 1,045,550 317,663 30,171 15 27,087 57,273 374,936 56,813 318,123 ( 4,094 ) 696 ( 3,398) ( 621 ) - ( 621) ( 4,019) 314,104	%
				100 10 90 37 12 20 69 21 2 - 2 4 25 4 21 - - - - - - - 21 9.60 9.51

See accompanying notes to financial statements.

(English Translation of Financial Statements and Report Originally Issued in Chinese) 104 CORPORATION

Statements of Changes in Equity

For the years ended December 31, 2018 and 2017

(Expressed in Thousands of New Taiwan Dollars)

	Retained earnings	Retained earnings	Other equity interest
			Others ( 11,690 ) - - - - - 1,575 - 6,735 ( 3,380 ) - ( 3,380) - - - - - 634 - 2,142 ( 604 )
Legal reserve 338,362 39,837 - - - - - - - 378,199 - 378,199 - - - - - - - - 378,199	Special reserve - - - - - - - - - - - - 2,941 - - - - - - - 2,941	Unappropriated earnings 506,436 ( 39,837 ) ( 358,838 ) 318,123 ( 3,398) 314,725 231 - - 422,717 3,116 425,833 ( 2,941 ) ( 318,650 ) 282,207 279 282,486 206 - - 386,934

See accompanying notes to financial statements.

(English Translation of Financial Statements and Report Originally Issued in Chinese) 104 CORPORATION

Statements of Cash Flows

For the years ended December 31, 2018 and 2017

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from (used in) operating activities: Income before tax Adjustments: Adjustments to reconcile profit: Depreciation expense Amortization expense Expected credit loss / Provision for bad debt expense Interest income Compensation cost of restricted employee shares Share of profit of subsidiaries, associates and joint ventures accounted for using equity method Loss (gain) on disposal of property, plant and equipment Adjustments for restricted employee shares Total adjustments to reconcile profit Changes in operating assets and liabilities: Net changes in operating assets: Notes receivable Accounts receivable Other receivable Other financial assets Other current assets Total net changes in operating assets Net changes in operating liabilities: Contract liabilities Notes payable Accounts payable Other payables Deferred revenue Other current liabilities Net defined benefit liabilities Total net changes in operating liabilities Total net changes in operating assets and liabilities Total adjustments Cash inflow generated from operations Interest received Dividends received Income taxes paid Net cash flows from operating activities Cash flows from (used in) investing activities: Acquisition of financial assets at fair value through profit or loss Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Decrease (increase) in refundable deposits Acquisition of intangible assets Increase in prepayments for equipment Net cash flows used in investing activities Cash flows used in financing activities: Cash dividends paid Net cash flows from financing activities Net increase in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year	2018 $ 345,274 39,489 4,434 558 ( 11,912 ) 2,142 ( 23,074 ) 92 ( 1,005) 10,724 631 ( 11,868 ) ( 113 ) ( 150 ) ( 1,058) ( 12,558) 59,651 393 ( 902 ) 14,845 - 6,237 ( 1,302) 78,922 66,364 77,088 422,362 11,879 25,717 ( 43,845) 416,113 ( 4,914 ) ( 42,910 ) - ( 500 ) ( 4,039 ) ( 1,594) ( 53,957) ( 318,650) ( 318,650) 43,506 1,917,721 $ 1,961,227	2017 374,936 46,378 8,266 804 ( 11,641 ) 6,735 ( 27,087 ) ( 54 ) ( 952) 22,449 1,034 2,470 1,998 - ( 5,639) ( 137) - - ( 726 ) 44,258 21,214 ( 6,783 ) ( 1,355) 56,608 56,471 78,920 453,856 11,659 37,828 ( 51,829) 451,514 - ( 30,441 ) 541 707 ( 1,026 ) - ( 30,219) ( 358,838) ( 358,838) 62,457 1,855,264 1,917,721

See accompanying notes to financial statements.

Independent Auditors' Report

To the Board of Directors of 104 Corporation:

Opinion

We have audited the consolidated financial statements of 104 Corporation and Subsidiaries ("the Consolidated Company"), which comprise the consolidated balance sheets as of December 31, 2018 and 2017, the consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Consolidated Company as at December 31, 2018 and 2017, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and with the International Financial Reporting Standards ("IFRSs"), International Accounting Standards ("IASs"), interpretation as well as related guidance endorsed by the Financial Supervisory Commission of the Republic of China.

Basis for Opinion

We conducted our audit in accordance with the "Regulations Governing Auditing and Certification of Financial Statements by Certified Public Accountants" and the auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditors' Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Consolidated Company in accordance with the Certified Public Accountants Code of Professional Ethics in Republic of China ("the Code"), and we have fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis of our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements taken as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Based on our judgement, the key audit matters that should be communicated in this audit report are as follows:

Revenue recognition

Please refer to note 4(12) for accounting policy related to revenue recognition, and note 6(13) for the disclosure related to revenue from contracts with customers of the consolidated financial statements.

Description of key audit matter:

The Consolidated Company's operating revenues is the main indicator for investors and management to assess their financial or business performance. Since 104 Corporation is a listed company, it has a high risk of false representation. Furthermore, in 2018, the Consolidated Company is required to adopt the International Financial Reporting Standard No. 15 for the first time, wherein its recognition of revenue and its judgment of the timing of the transfer of commodity control rights are extremely important for the expression of its financial statements. The Consolidated Company's operating revenues mainly derive from providing online advertising and consulting services, wherein they are recognized in the following different ways. Additionally, the Consolidated Company often received its payments in advance after the contracts are signed; therefore, the amount is deferred according to the Consolidated Company's policy and recognized as revenue once the service is performed. The aforementioned matter is the basis for the Consolidated Company's management to determine the amount of revenue that can be recognized, therefore, revenue recognition was considered to be one of the key audit matters in our audit.

How the matter was addressed in our audit:

Our audit procedures included:

‧ Assessing and testing the design, as well as the effectiveness of the operating on the control over sales and collection cycle. Selecting appropriate samples and comparing them to relevant documents such as customer order and confirmation of completion order signed by customer to assess whether revenue and deferred revenue have been appropriately recognized.
‧ Performing comparison analysis on operating revenue of the current period to last period and the latest quarter to assess the existence of any significant exceptions, and further identify and analyze the reasons, if there is any significant exception.
‧ Performing test-of-detail on operating revenue to assess the assertions of existence and accuracy, as well as the appropriateness of recognition.
‧ Examining relevant documents of a period before and after the balance sheets date, such as customer order, information reported back from business department, or confirmation of completion of duty executed by customer, and verify the accuracy of the amount recognized as revenue in accordance with the timing of service provided or quantity provided to determine whether the deferred revenue should not be recognized as revenue and whether operating revenue has been appropriately recognized.

Other Matter

104 Corporation has prepared parent-company-only financial statements as of and for the years ended December 31, 2018 and 2017 and, on which we have expressed an unqualified opinion.

Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with Regulations Governing the Preparation of Financial Reports by Securities Issuers and IFRSs, IASs, interpretation as well as related guidance endorsed by the Financial Supervisory Commission of the Republic of China, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Consolidated Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Consolidated Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Consolidated Company's financial reporting process.

Auditors' Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the auditing standards generally accepted in the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

Identify and assess the risks of material misstatement of the consolidated financial statements whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Consolidated Company's internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Consolidated Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors' report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors' report. However, future events or conditions may cause the Consolidated Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient and appropriate audit evidence regarding the financial information of the entities or business activities within the Consolidated Company to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the Consolidated Company audit. We remain solely responsible for our audit opinion.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors' report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partners on the audit resulting in this independent auditors' report are Min-Ju Chao and Lily Lu.

KPMG

Taipei, Taiwan (Republic of China) March 13, 2019

Note to Readers

The accompanying consolidated financial statements are intended only to present the consolidated statement of financial position, financial performance and cash flows in accordance with the accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to audit such consolidated financial statements are those generally accepted and applied in the Republic of China.

The independent auditors' report and the accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors' report and consolidated financial statements, the Chinese version shall prevail.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) 104 CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets

December 31, 2018 and 2017

(Expressed in Thousands of New Taiwan Dollars)

	December	31,	December	31,		December	31,	December	31,
	2018		2017			2018		2017
	Amount	%	Amount	%	Liabilities and Equity	Amount	%	Amount	%
					Current liabilities:
$	2,072,669	85	2,043,470	87	Contract liability－currrent (note 6(13))	$ 446,687	18	-	-
	565	-	1,196	-	Notes payable	395	-	2	-
	46,999	2	37,040	2	Accounts payable	6,019	-	6,920	-
	21,905	1	9,104	-	Other payables (note 6(15))	361,753	15	312,516	14
	150	-	-	-	Current tax liabilities	64,694	3	46,472	2
	15,140	1	14,633	1	Deferred revenue (note 6(14))	-	-	391,760	17
	2,157,428	89	2,105,443	90	Other current liabilities	49,650	2	43,721	2
					Total current liabilities	929,198	38	801,391	35
	4,914	-	-	-	Non-current liabilities:
	243,851	10	206,619	9	Net defined benefit liability (note 6(8))	5,666	-	7,213	-
	3,514	-	6,705	-	Total non-current liabilities	5,666	-	7,213	-
	5,697	-	5,692	-	Total liabilities	934,864	38	808,604	35
	1,594	-	-	-	Equity attributable to owners of parent (notes 6(8), (9), (10) and (11))
	8,250	-	7,840	-	Common stock	331,917	14	332,072	14
	10,000	1	10,000	1	Capital surplus	397,859	16	399,549	17
	277,820	11	236,856	10	Retained earnings:
					Legal reserve	378,199	16	378,199	16
					Special reserve	2,941	-	-	-
					Unappropriated earnings	386,934	16	422,717	18
					Total retained earnings	768,074	32	800,916	34
					Other equity:
					Foreign currency translation differences for foreign operations	(4,051)	-	(2,941)	-
					Others	(604)	-	(3,380)	-
					Total other equity	(4,655)	-	(6,321)	-
					Total equity attributable to owners of parent	1,493,195	62	1,526,216	65
					Non-controlling interests	7,189	-	7,479	-
					Total equity	1,500,384	62	1,533,695	65
$	2,435,248	100	2,342,299	100	Total liabilities and equity	$ 2,435,248	100	2,342,299	100

December 2018	31, % 85 - 2 1 - 1 89 - 10 - - - - 1 11	December 2017	31, % 87 - 2 - - 1
Amount $ 2,072,669 565 46,999 21,905 150 15,140 2,157,428 4,914 243,851 3,514 5,697 1,594 8,250 10,000 277,820		Amount 2,043,470 1,196 37,040 9,104 - 14,633 2,105,443 - 206,619 6,705 5,692 - 7,840 10,000 236,856
			90
			- 9 - - - - 1
			10
$ 2,435,248	100	2,342,299

Total assets

See accompanying notes to consolidated financial statements.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) 104 CORPORATION AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

For the years ended December 31, 2018 and 2017

(Expressed in Thousands of New Taiwan Dollars, Except for Earnings Per Common Share)

2018	% 100 10	2017
Amount		Amount
$ 1,577,612 159,204 1,418,408 601,196 171,257 322,846 1,095,299 323,109 27,343 1,603 28,946 352,055 69,972 282,083 245 34 279 (1,276) -		1,539,995 150,154 1,389,841 552,749 180,871 298,062 1,031,682 358,159 25,632 (2,006) 23,626 381,785 63,122 318,663 (4,094) 696 (3,398) (689) -
	90
	38 11 21
	70
	20
	2 -
	2
	22 4
	18
	- -
	-
	- - -
(1,276) (997) $ 281,086 $ 282,207 (124) $ 282,083 $ 281,376 (290) $ 281,086 $	-	(689) (4,087) 314,576 318,123 540 318,663 314,104 472 314,576
	-
	18
	18 -
	18
	18 -
	18
	8.51
$	8.44

See accompanying notes to consolidated financial statements.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) 104 CORPORATION AND SUBSIDIARIES

Consolidated Statements of Changes in Equity

For the years ended December 31, 2018 and 2017

(Expressed in Thousands of New Taiwan Dollars)

			Equity attributable to owners of parent	Equity attributable to owners of parent	Equity attributable to owners of parent	Equity attributable to owners of parent	Equity attributable to owners of parent	Equity attributable to owners of parent
Common stock $ 332,417 - - - - - - (345 ) - 332,072 - 332,072 - - - - - - (155 ) - $ 331,917	Capital surplus		Retained earnings			Other equity interest			Total equity attributable to owners of parent 1,565,167 - (358,838 ) 318,123 (4,019) 314,104 (952 ) - 6,735 1,526,216 3,116 1,529,332 - (318,650 ) 282,207 (831) 281,376 (1,005 ) - 2,142 1,493,195	Non- controlling interests 7,007 - - 540 (68) 472 - - - 7,479 - 7,479 - - (124 ) (166) (290) - - - 7,189
							Others (11,690 ) - - - - - 1,575 - 6,735 (3,380 ) - (3,380) - - - - - 634 - 2,142 (604)	Total (14,010 ) - - - (621) (621) 1,575 - 6,735 (6,321 ) - (6,321) - - - (1,110) (1,110) 634 - 2,142 (4,655)
		Legal reserve 338,362 39,837 - - - - - - - 378,199 - 378,199 - - - - - - - - 378,199	Special reserve - - - - - - - - - - - - 2,941 - - - - - - - 2,941	Unappropriate d earnings 506,436 (39,837 ) (358,838 ) 318,123 (3,398) 314,725 231 - - 422,717 3,116 425,833 (2,941 ) (318,650 ) 282,207 279 282,486 206 - - 386,934	Total

See accompanying notes to consolidated financial statements.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) 104 CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the years ended December 31, 2018 and 2017

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from (used in) operating activities: Income before tax Adjustments: Adjustments to reconcile profit: Depreciation expense Amortization expense Expected credit loss / Provision for bad debt expense Interest income Compensation cost of restricted employee shares Loss (gain) on disposal of property, plant and equipment Unrealized foreign exchange loss Adjustments for restricted employee shares Total adjustments to reconcile profit Changes in operating assets and liabilities: Net changes in operating assets: Notes receivable Accounts receivable Other receivable Other financial assets Other current assets Total net changes in operating assets Net changes in operating liabilities: Contract liabilities Notes payable Accounts payable Other payables Deferred revenue Other current liabilities Net defined benefit liabilities Total net changes in operating liabilities Total net changes in operating assets and liabilities Total adjustments Cash inflow generated from operations Interest received Income taxes paid Net cash flows from operating activities Cash flows from (used in) investing activities: Acquisition of financial assets at fair value through profit or loss Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Decrease (increase) in refundable deposits Acquisition of intangible assets Increase in prepayments for equipment Net cash flows used in investing activities Cash flows used in financing activities: Cash dividends paid Net cash flows from financing activities Effect of exchange rate changes on cash and cash equivalents Net increase in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year Components of cash and cash equivalents Cash and cash equivalents in consolidated statements of financial position Other item qualifying for cash and cash equivalents under the definition of IAS 7 Cash and cash equivalents at end of year	2018 $ 352,055 39,567 4,434 199 (12,977) 2,142 92 8 (1,005) 32,460 631 (9,923) (805) (150) (1,354) (11,601) 58,441 393 (901) 18,075 - 5,963 (1,302) 80,669 69,068 101,528 453,583 12,936 (52,310) 414,209 (4,922) (42,910) - (410) (4,039) (1,594) (53,875) (318,650) (318,650) (1,289) 40,395 2,043,470 $ 2,083,865 $ 2,072,669 11,196 $ 2,083,865		2017 381,785 46,665 8,266 1,155 (12,643) 6,735 (57) - (952) 49,169 1,048 3,345 1,658 - (5,906) 145 - - (726) 41,511 22,752 (6,781) (1,355) 55,401 55,546 104,715 486,500 12,660 (54,645) 444,515 - (30,521) 564 627 (1,026) - (30,356) (358,838) (358,838) (681) 54,640 1,988,830 2,043,470 2,043,470 - 2,043,470

See accompanying notes to consolidated financial statements.

Attachment 4: Earnings Distribution Proposal

104 Corporation Earnings Distribution Proposal

		Unit`：`NT$ Note NT$8.51 per share

Items	Amount	Note

Unappropriated earnings at beginning of year	101,126,665
Plus: Adjustment of IFRS 15	3,115,417
Unappropriated earnings after adjustment of IFRS 15	104,242,082
Plus:
Remeasurements from defined benefit plans	279,085
Adjustments for restricted employee shares	205,169
2018 Net income after tax	282,207,001
Earnings available for distribution	386,933,337
Less:
Legal reserve	(1,109,635)
Items of distribution:
Shareholders’ dividends - cash	(282,461,367)	NT$8.51 per share
Unappropriated earnings at end of year	103,362,335

Chairman: Rocky Yang General Manager: Rocky Yang Chief Accountant: Tiffany Lin

Attachment 5: Comparison Table of the “Articles of Incorporation” Amendments

104 Corporation

Comparison Table of the “Articles of Incorporation” Amendments

Amended Articles	Current Articles	Explanation
Article6	Article5-1	To defer the article number.
Article7 All share certificates of the Company shall be registered, affixed with the signatures or personal seals of the director representing the Company.The share certificates shall be duly certified or authenticatedby the bank which is competent to certify shares under the lawsbefore issuance. The Company issued shares are exempted from printing share certificates, and shallregister the issued shares with a centralized securities depositary enterprise and follow the regulations of that enterprise.	Article6 All share certificates of the Company shall be registered,signed or sealed and numbered by at least three directors.The share certificates shall be duly certified or authenticatedby the competent authority or a certified institution appointed by the competent authoritybefore issuance. The Company issued shares are exempted from printing share certificates, and shallbe registered in Taiwan Depository & Clearing Corporation.	1. To defer the article number. 2. The amendment is conducted in accordance with Paragraph 1 of Article 162 of the “Company Act.” 3. The amendment is conducted in accordance with Paragraph 2 of Article 161-2 of the “Company Act.”
(Deleted)	Article 7 When the Company issues new shares, all the shares to be printed in that issue should be printed together; moreover, issued shares are exempted from printing. The issued shares in the provisions of the preceding article shall be registered with or stored in the Taiwan Depository & Clearing Corporation; they may also be merged or reissued with large denomination securities as per the demand of Taiwan Depository & Clearing Corporation.	Article 7 is deleted in accordance with deletion of Articles 162-1~162-2 of the “Company Act.”
Article 9 Assignment/transferof shares shall be suspended 60 days before the date of a general meeting of shareholders, and 30 days before the date of any extraordinary meeting of shareholders, or within five days before the day on which dividends, bonus, or any other benefit is scheduled to be paid by the Company.	Article 9 Registration for transferof shares shall be suspended 60 days before the date of a general meeting of shareholders, and 30 days before the date of any extraordinary meeting of shareholders, or within five days before the day on which dividends, bonus, or any other benefit is scheduled to be paid by the Company.	The amendment is conducted in accordance with Paragraph 1 of Article 165 of the “Company Act.”

Amended Articles	Current Articles	Explanation
Article 18 To disperse director and supervisor law liability risks and thereby increase the Company’s governance capability, the Companymay obtain Directors andSupervisorsLiability Insurance for all directors and supervisors, and for all reinvestment company director and supervisor representativeswith respect to liabilities resulting from exercising their duties during their terms of directorship. The Company shall report the insured amount, coverage, premium rate, and other important contents of the Directors and Supervisors Liability Insurance it has obtained or renewed for directors and supervisors, at the most recent board meeting.	Article 18 To disperse director and supervisor law liability risks and thereby increase the Company’s governance capability, the Companyshall take out Directors andOfficersLiability Insurance for all directors and supervisors, and for all reinvestment company director and supervisor representativesthroughout their term of office.	The amendment is conducted in accordance with Article 193-1 of the “Company Act.”
Article 26 (Paragraph 1 is not amended: omitted) The employee bonus in the preceding paragraph shall be distributed in the form of shares or in cash and object of payment includes the employees ofparents or subsidiaries of the Company meeting certain specific requirements. The directors and supervisors’ remuneration shall be distributed in the form of cash. (Paragraph 3 is not amended: omitted)	Article 26 At the end of the fiscal year, if the Company operates at a profit (the profit so-called is pre-tax profit before deducting remuneration for distributed employees and directors and supervisors) it shall contribute an employee bonus consisting of 8%-15% of employee salaries and bonuses to directors and supervisors consisting of no more than 3% of their salaries. However, any losses accumulated by the Company to date shall be paid off first. The employee bonus in the preceding paragraph shall be distributed in the form of shares or in cash and object of payment includes the employees of subsidiaries of the Company meeting certain specific requirements. The directors and supervisors’ remuneration shall be distributed in the form of cash. The items in the preceding two paragraphs shall be undertaken by resolution of the board of directors and a report shall be submitted to the shareholders’meeting.	The amendment is conducted in accordance with Paragraph 4 of Article 167-1, Paragraph 3 of Article 167-2 and Paragraph 5 of Article 235-1 of the “Company Act.”
Article 27 At the end of each fiscal year, if the Companyhasnet profits they shall	Article 27 At the end of each fiscal year, if the Companyhasnet profits they shall	1. The amendment is conductedinaccordance

Amended Articles

Current Articles

Explanation

Amended Articles	Current Articles	Explanation
first be used to remedy any losses and 10% of net profits will be set aside as a statutory surplus reserve. However, if the accumulation of statutory surplus reserves reaches the totalpaid-incapital, then this limitation does not apply. Whether the rest of the accumulated profit is to be distributed in the form of dividends or retained shall be decided by resolution at the shareholders’meeting.	first be used to remedy any losses and 10% of net profits will be set aside as a statutory surplus reserve. However, if the accumulation of statutory surplus reserves reaches the total capitalvolume,then this limitation does not apply. Whether the rest of the accumulated profit is to be distributed in the form of dividends or retained shall be decided by resolution at the shareholders’meeting.	with Paragraph 1 of Article 237 of the “Company Act.” 2. To amend the wording. (Only for the Chinese version)
Article 28 The Company’s dividend policy shall be based on considerations of the Company’s current industry operating environment and growth phase and shall accord with future capital demand and the long term financial planning of the Company, and be allocated on sound principles. Currently our industry is projected to enjoy a growth phase and over the next few years, we anticipate business expansion plans and capital demand. Therefore, as regards theParagraph 2 of the preceding Articlevis-a-vis surplus profit available for distribution, dividends shall be distributed in the form of cash or shares. The cash dividend shall not be less than 10% of the total amount of the dividend. The type and ratio of surplus profit distribution shall depend on the real profit and capital condition at the end of each fiscal year and be revised by resolution of the shareholders’ meeting.	Article 28 The Company’s dividend policy shall be based on considerations of the Company’s current industry operating environment and growth phase and shall accord with future capital demand and the long term financial planning of the Company, and be allocated on sound principles. Currently our industry is projected to enjoy a growth phase and over the next few years, we anticipate business expansion plans and capital demand. Therefore, as regards thesecond part of Article 26 vis-a-vis surplus profit available for distribution, dividends shall be distributed in the form of cash or shares. The cash dividend shall not be less than 10% of the total amount of the dividend. The type and ratio of surplus profit distribution shall depend on the real profit and capital condition at the end of each fiscal year and be revised by resolution of the shareholders’ meeting.	To amend the wording.
Article 30 The Articles of Incorporation was first made executed on October 1, 1993 The first amendment was made on July 31, 1998 The second amendment was made on March 14, 2000 The third amendment was made on July 20, 2000 The fourth amendment was made on August 14, 2000 The fifth amendment was made on June 3,2002	Article 30 The Articles of Incorporation was first made executed on October 1, 1993 The first amendment was made on July 31, 1998 The second amendment was made on March 14, 2000 The third amendment was made on July 20, 2000 The fourth amendment was made on August 14, 2000 The fifth amendment was made on June 3,2002	1. To amend the wording. (Only for the Chinese version)

	Amended Articles	Current Articles	Explanation
	The sixth amendment was made on June 9, 2004 The seventh amendment was made on May 16. 2005 The eighth amendment was made on June 12, 2006 The ninth amendment was made on June 11, 2008 The tenth amendment was made on June 10, 2009 The eleventh amendment was made on June 17, 2010 The twelfth amendment was made on June 15, 2012 The thirteenth amendment was made on June 24, 2015 The fourteenth amendment was made on June 7, 2016 The fifteenth amendment was made on June 8, 2017 The Sixteenth amendment was made on May 29, 2019	The sixth amendment was made on June 9, 2004 The seventh amendment was made on May 16. 2005 The eighth amendment was made on June 12, 2006 The ninth amendment was made on June 11, 2008 The tenth amendment was made on June 10, 2009 The eleventh amendment was made on June 17, 2010 The twelfth amendment was made on June 15, 2012 The thirteenth amendment was made on June 24, 2015 The fourteenth amendment was made on June 7, 2016 The fifteenth amendment was made on June 8, 2017	2. To add the date.

Attachment 6: Comparison Table of the “Rules and Procedures of Shareholders’ Meetings” Amendments

104 Corporation

Comparison Table of the “Rules and Procedures of Shareholders’ Meetings” Amendments

Amended Articles Current Articles Explanation Article 9 Article 9 The attendance and voting at a The attendance and voting at a shareholders’ meeting shall be shareholders’ meeting shall be calculated based on the number of calculated based on the number of shares. shares. The shares held by shareholders The shares held by shareholders who are without voting rights shall who are without voting rights shall be excluded from the total number be excluded from the total number of shares in the issue when voting of shares in the issue when voting on a resolution at a shareholders’ on a resolution at a shareholders’ meeting. meeting. The number of attending shares The number of attending shares The amendment is conducted shall be calculated according to the shall be calculated according to the in accordance with Paragraph number of sign-in cards submitted number of sign-in cards submitted 2 of Article 177-1 of the and the number of shares voted in and the number of shares voted in “Company Act.” writing or by way of electronic writing. transmission. Article 24 Article 24 All resolutions reached at a All resolutions reached at a shareholders’ meeting shall be shareholders’ meeting shall be compiled in the form of meeting compiled in the form of meeting minutes. The meeting minutes shall minutes. The meeting minutes shall be signed or stamped by the chair be signed or stamped by the chair and shall be distributed to each and shall be distributed to each shareholder within 20 days of the shareholder within 20 days of the meeting. meeting. The Company may distribute the The Company may distribute the 1. The amendment is meeting minutes in the form of an meeting minutes to shareholders conducted in accordance announcement by means of a public who hold less than 1,000 shares of with Paragraph 3 of notice. registered stock in the form of an Article 183 of the announcement on the Market “Company Act.” Observation Post System (MOPS). The date (year, month, and day) and The date (year, month, and day) and 2. The amendment is place of the meeting, the name of place of the meeting, the name of conducted in accordance the chairperson, the resolution the chairperson, the resolution with Paragraph 4 of method, the summary of method, the summary of Article 183 of the proceedings, and outcomes of the proceedings, and outcomes of the “Company Act.” meeting shall be recorded in the meeting shall be faithfully recorded meeting minutes, and the meeting in the meeting minutes, and the minutes shall be permanently meeting minutes shall be retained as along as the Company permanently retained as along as the exists. Company exists. Regarding the resolution method as Regarding the resolution method as 3. The amendment is mentioned in the preceding mentioned in the preceding conducted in accordance paragraph shall be determined in paragraph, “approved without with Article 15 of the accordance with the laws or objection from any attending “Articles of

	Amended Articles		Current Articles	Explanation
	ordinance and the Articles of Incorporations of the company. However, if there are any objections, the voting method as well as the number of votes in favor and the ratio of votes in favor over total votes cast shall be specified in the meeting minutes.		shareholder following the chair’s inquiry”shall be recorded in the meeting minutes if no objection is voiced by shareholders against a motion after the chair’s asking. However, if there are any objections, the voting method as well as the number of votes in favor and the ratio of votes in favor over total votes cast shall be specified in the meeting minutes.	Incorporation.”
	Article 25 These Rules and Procedures shall come into force after their approval at the shareholders’ meeting, Subsequent amendments and rescission thereto shall be affected in the same manner. Matters not covered in these Rules shall be based on the relevant laws of the Republic of China and be subject to uniform interpretation by the revision unit.		Article 25 These Rules and Procedures shall come into force after their approval at the shareholders’ meeting.The same applies when an amendment is made.	The amendment is conducted in accordance with “Level of Authority Table.”

Attachment 7: Comparison Table of the “Directors and Supervisors Election Guidelines” Amendments

104 Corporation

Comparison Table of the “Directors and Supervisors Election Guidelines” Amendments

	Amended Articles		Current Articles	Explanation
	Article 4 The number of directors and supervisors will be as specified in the Company’s Articles of Incorporation. Those receiving ballots representing the highest numbers of voting rights will sequentially be elected as the directors or supervisors according to their respective numbers of votes. When two or more persons receive the same number of votes, thus exceeding the specified number of positions, they shall draw lots to determine the winner, with the chair drawing lots on behalf of any person not in attendance.		Article 4 The number of directors and supervisors will be as specified in the Company’s Articles of Incorporation. Those receiving ballots representing the highest numbers of voting rights will sequentially be elected as the directors or supervisors according to their respective numbers of votes. When two or more persons receive the same number of votes, thus exceeding the specified number of positions, they shall draw lots to determine the winner, with the chair drawing lots on behalf of any person not in attendance. For any shareholder who is simultaneously elected as both director and supervisor, in accordance with the preceding paragraph, he/she shall determine whether to assume the position of the director or the supervisor, and the resulting vacancy shall be filled by the candidate who receives the second highest rights of vote originally.	Deleted in accordance with Article 9 of the “Procedures for Election of Directors and Supervisors.”
	Article 5 The Company shall comply with the Articles of Incorporation to adopt a candidate nomination system for the election of the directors and supervisors.The shareholders shall elect the directors and supervisors from among the nominees listed in the roster of director and supervisor candidates.		Article 5 The Company shall comply with the Articles of Incorporation to adopt a candidate nomination system for the election of the directors and supervisors.For the purpose of reviewing the qualifications, academic backgrounds and experiences of director and supervisor candidates and whether they are involved in any of the actions prescribed in Article 30 of the Company Act, the Company may not arbitrarily add the documentary proof of other qualifications. In addition, it shall publicize the results of the review to the shareholders for their reference, enabling them to select the	1. The amendment is conducted in accordance with Paragraph 1 of Article 192-1 of the “Company Act.”

Amended Articles	Current Articles	Explanation
Any shareholder holding 1% or more of the total number of outstanding shares issued by the Company may submit to the Company in writing a roster of director and supervisor candidates that shall describe the name, education background and past work experience, provided that the total number of director and supervisor candidates so nominated shall not exceed the quota of the directors and supervisors to be elected. This restrictive condition shall also be applicable to the roster of director and supervisor candidates nominated by the board of directors of the Company.	competent directors and supervisors.	2. To make an addition in accordance with Paragraph 3 of Article 192-1 of the “Company Act.”
Article 8 A ballot is invalid under any of the following circumstances: 1. The ballot was not prepared by the Company. 2. A blank ballot is placed in the ballot box. 3. The writing is unclear and indecipherable or has been altered. 4. Other words or marks are entered in addition to the candidate’s name, account number, identity card number,attendance card numberand the number of voting rights allotted.	Article 8 A ballot is invalid under any of the following circumstances: 1. The ballot was not prepared by the Company. 2. A blank ballot is placed in the ballot box. 3. The writing is unclear and indecipherable or has been altered. 4. Other words or marks are entered in addition to the candidate’s accountnameand shareholder account numberoridentity card number and the number of voting rights allotted. 5. The name of the candidate entered in the ballot is identical to that of another shareholder, but no shareholder account number or ID card number is provided in the ballot to identify such individual.	1. To amend the wording. (Only for the Chinese version) 2. To align with the adjustment for the ballot. 3. To align with the adjustment for the ballot.
Article 9 The voting rights shall be calculated on site immediately after the end of the poll, and the results of the calculation shall be announced by the chair or a delegated master of ceremony on the site, including the list of persons elected as directors or supervisors and the numbers of votes with which they were elected.	Article 9 The voting rights shall be calculated on site immediately after the end of the poll, and the results of the calculation shall be announced by the chair or a delegated master of ceremony on the site.	To align with the adjustment for the ballot.

	Amended Articles		Current Articles	Explanation
	Article 10 These Rulesshall come into force after theirapproval at the shareholders’ meeting,Subsequent amendments and rescission thereto shall be affected in the same manner. Matters not covered in these Rules shall be based on the relevant laws of the Republic of China and be subject to uniform interpretation by the revision unit.		Article 10 The Rules, and any amendments thereto, shall be implemented after beingapproval at the shareholders’ meeting.	The amendment is conducted in accordance with “Level of Authority Table.”

Attachment 8: Comparison Table of the “Procedure for Acquisition and Disposal of Assets” Amendments

104 Corporation

Comparison Table of the “Procedure for Acquisition and Disposal of Assets ”

Amendments

	Amended Articles	Current Articles	Explanation
	Article 3: Scale of Assets The term “assets” as used in the Procedures includes the following: (Subparagraph 1 is not amended: omitted) 2. Real property (including land, houses and buildings, investment property, and construction enterprise inventory) and equipment. (Subparagraph 3~4 are not amended: omitted) 5. Right-of-use assets 6.Claims of financial institutions (including receivables, bills purchased and discounted, loans, and overdue receivables). 7.Derivatives. 8.Assets acquired or disposed of in connection with mergers, demergers, acquisitions, or transfer of shares in accordance with law. 9. Other majorassets.	Article 3: Scale of Assets The term “assets” as used in the Procedures includes the following: (Subparagraph 1 is not amended: omitted) 2. Real property (including land, houses and buildings, investment property, rights to use land, and construction enterprise inventory) and equipment. (Subparagraph 3~4 are not amended: omitted) 5.Claims of financial institutions (including receivables, bills purchased and discounted, loans, and overdue receivables). 6.Derivatives. 7.Assets acquired or disposed of in connection with mergers, demergers, acquisitions, or transfer of shares in accordance with law. 8. Other majorassets.	1. To add Subparagraph 5 expanding the scope of right-of-use assets and move the existing Subparagraph 2, rights-of- use to land, to Subparagraph 5 in accordance with “IFRS 16.” 2. The existing Subparagraph 5~8 are moved to Subparagraph 6~9.
	Article 4: Definition of Terms 1. Derivatives: Forward contracts, options contracts, futures contracts, leverage contracts, swap contracts, whose value is derived froma specified interest rate, financial instrument price, commodity price,foreign exchange rate, index of prices or rates,credit rating or credit index, or other variable; or hybrid contracts combining the above contracts; or hybrid contracts or structured products containing embedded derivatives.The term “forward contracts” does not include insurance contracts, performance contracts, after-sales service contracts,long-term	Article 4: Definition of Terms 1. Derivatives: Forward contracts, options contracts, futures contracts, leverage contracts, swap contracts, and compound contracts combining the above products, whose value is derived from assets, interest rates, foreign exchange rates, indexes, or other interests. The term “forward contracts” does not include insurance contracts, performance contracts, after-sales service contracts, long-term leasing contracts, or long-term purchase (sales) agreements.	1. The scope and wording of Derivatives definition in Subparagraph 1 is amended in accordance with “IFRS 9 Financial Instruments.”

Amended Articles	Current Articles	Explanation
leasing contracts, or long-term purchase (sales) contracts. 2. Assets acquired or disposed through mergers, demergers, acquisitions, or transfer of shares in accordance with law: Refers to assets acquired or disposed through mergers, demergers, or acquisitions conducted under the Business Mergers and Acquisitions Act, Financial Holding Company Act, Financial Institution Merger Act and other acts, This could also refer to the transfer of shares from another company through the issuance of new shares of its own as the consideration therefor (hereinafter “transfer of shares”) under Article156-3of the “Company Act.” (Subparagraph 3~6 are not amended: omitted)	2. Assets acquired or disposed through mergers, demergers, acquisitions, or transfers of shares in accordance with law: Refers to assets acquired or disposed through mergers, demergers, or acquisitions conducted under the Business Mergers and Acquisitions Act, Financial Holding Company Act, Financial Institution Merger Act, and other acts. This could also refer to the transfer of shares from another company through the issuance of new shares of its own as the consideration therefor (hereinafter “transfer of shares”) underParagraph 8 of Article 156 of the “Company Act.” (Subparagraph 3~6 are not amended: omitted)	2. The amendments release of the “Company Act” is on August 1st, 2018, implemented from November 11th, 2018. In accordance with “the Company Act” Paragraph 8 of Article 156 cited in Subparagraph 2 is amended to Article 156-3.
Article 5: Exclusion of Related Parties Professional appraisers and their officers, certified public accounts, attorneys, and securities underwriters that provide the Company with appraisal reports, certified public accountant’s opinions, attorney’s opinions, or underwriter’s opinions shallmeet the following requirements: 1. May not have previously received a final and unappealable sentence to imprisonment for 1 year or longer for a violation of the Act, the Company Act, the Banking Act of The Republic of China, the Insurance Act, the Financial Holding Company Act, or the Business Entity Accounting Act, or for fraud, breach of trust, embezzlement, forgery of documents, or occupational crime. However, this provision does not apply if 3 years have already passed since completion of service of the sentence, since expiration of the period of a suspended sentence, or since a pardon was received.	Article 5: Exclusion of Related Parties Professional appraisers and their officers, certified public accounts, attorneys, and securities underwriters that provide the Company with appraisal reports, certified public accountant’s opinions, attorney’s opinions, or underwriter’s opinions shallnot be a related party of any party to the transaction.	1. For the purpose of simplify the regulations, the requirements of professional appraisers and their officers, certified public accounts, attorneys, and securities underwriters that provide public companies with appraisal reports, certified public accountant’s opinions, attorney’s opinions, or underwriter’s opinions mentioned in the 4th point of Order No. Taiwan- Finance-Securities-I- 0920001151 announced by Securities and Futures Bureau of Financial Supervisory Commission of the Taiwan (ROC) is included in the Procedure. In addition, to amend Subparagraph 1~3 of Paragraph1 stipulating the qualification for experts in accordance with Paragraph 4of Article 53
1.	transaction.

	Current Articles	Explanation
2.		of “Securities and Exchange Act”, and the good faith principle in accordance with Subparagraph 15 of Paragraph 1 of Article 8 of the “Regulations Governing the Offering and Issuance of Securities by Securities Issuers”, repealing preceding regulations. 2. To amend Paragraph 2 stipulating the responsibilities of external experts such as making the appraisal reports, evaluation, and statement in accordance to the appraisal reports, evaluation, and statement of investment property mentioned in Article 9 of “Regulations Governing the Preparation of Financial Reports by Securities Issuers”.
3.
1.
2.
3.
4.

Article 6: Scale and Limit of Investment Real property, right-of-use assets thereof or securitiesacquired by the company for non-business use, other than bonds or bills traded under repurchase agreements,negotiable	Article 6: Scale and Limit of Investment Real property and securities acquired by the company for non- business use, other than bonds or bills traded under repurchase agreements,negotiable certificates	The amendment of the limit calculation of real property and right-of-use assets thereof or securities acquired by the Companyfor non-

Amended Articles	Current Articles	Explanation
certificates of deposit and other financial instruments, shall be executed in accordance with the company’s internal control system and the level of authority table. The limits thereof are as below: 1. The total amount of real property and right-of-use assetsfor non- business use shall not exceed 15% of the Company’s net worth for the previous year, audited by a certified public account. (Subparagraph 2~4 are not amended: omitted)	of deposit and other financial instruments, shall be executed in accordance with the company’s internal control system and the level of authority table. The limits thereof are as below: 1. The total amount of real property for non-business use shall not exceed 15% of the Company's net worth for the previous year, audited by a certified public account. (Subparagraph 2~4 are not amended: omitted)	business use regulation is made in accordance with “IFRS 16”.
Article 7: Appraisal and Operational Procedures for Assessment of Acquisition or Disposal of Assets 1. Determination Procedures for trading terms (1) The means of price determination and supporting reference materials for acquiring or disposing of assets: i. Acquisition or disposal of securities (i) The price of securities traded in centralized securities exchanges or over-the-counter securities firms shall be decided by the market price of such securities at the time of the transaction. (ii)The price of securities not acquired or disposed of in a centralized securities exchange or over-the-counter securities firms shall be decided upon by taking into account the net worth per share, profitability, future development potential and referring to the trading price at the time of the transaction. ii. An acquisition or disposal of real propertyand right-of-use assets, equipment or memberships, or intangible assets shall be conducted by means of price comparison, price negotiation, invitation to tender, or other methods. (2) The unit in charge shall abide by the Company's Approval Authorization Table to conduct an acquisitionordisposalofassets,	Article 7: Appraisal and Operational Procedures for Assessment of Acquisition or Disposal of Assets 1. Determination Procedures for trading terms (1) The means of price determination and supporting reference materials for acquiring or disposing of assets: i. Acquisition or disposal of securities (i) The price of securities traded in centralized securities exchanges or over-the-counter securities firms shall be decided by the market price of such securities at the time of the transaction. (ii)The price of securities not acquired or disposed of in a centralized securities exchange or over-the-counter securities firms shall be decided upon by taking into account the net worth per share, profitability, future development potential and referring to the trading price at the time of the transaction. ii. An acquisition or disposal of real property, equipment or memberships, or intangible assets shall be conducted by means of price comparison, price negotiation, invitation to tender, or other methods. (2) The unit in charge shall abide by the Company's Approval Authorization Table to conduct an acquisitionordisposalofassets,	The right-of-use assets is added in accordance with “IFRS 16.”

Amended Articles	Amended Articles	Current Articles	Explanation
and submit such to the unit in charge for deliberation. 2. Determination Procedures for authorized limits (1) Acquisition or disposal of securities The Company shall abide by its level of authority Table to conduct an acquisition or disposal of short-term and long- term securities investments. It shall then submit such to the unit in charge for deliberation. (2) Acquisition or disposal of real propertyand right-of-use assets, equipment or memberships, or intangible assets: The unit undertaking the operation shall arrange, according to the Company's level of authority Table, reasons for the proposed acquisition or disposal, underlying assets, trading counter-party, transfer price, payment/receipt terms, and supporting reference materials for prices. The unit shall then submit such to the unit in charge for deliberation.		and submit such to the unit in charge for deliberation. 2. Determination Procedures for authorized limits (1) Acquisition or disposal of securities The Company shall abide by its level of authority Table to conduct an acquisition or disposal of short-term and long- term securities investments. It shall then submit such to the unit in charge for deliberation. (2) Acquisition or disposal of real property, equipment or memberships, or intangible assets: The unit undertaking the operation shall arrange, according to the Company's level of authority Table, reasons for the proposed acquisition or disposal, underlying assets, trading counter-party, transfer price, payment/receipt terms, and supporting reference materials for prices. The unit shall then submit such to the unit in charge for deliberation.
	Article 9: Appraisal Report for Acquiring or Disposing of Real Property or Equipment In acquiring or disposing of real property, equipmentor right-of-use assets thereofwhich meets the standard for announcement and report, and where the transaction amount reaches 20 % of the Company's paid-in capital or NT$300 million or more, the Company, unless transacting with a domesticgovernment agency, engaging others to build on its own land, engaging others to build on rented land, or acquiring or disposing of equipmentor right-of- use assets thereof heldfor business use, shall obtain an appraisal report prior to the date of occurrence of the event from a professional appraiser and shall further comply with the following provisions: 1. Where due to special circumstancesitisnecessary to	Article 9: Appraisal Report for Acquiring or Disposing of Real Property or Equipment In acquiring or disposing of real property or equipment which meets the standard for announcement and report, and where the transaction amount reaches 20 % of the Company's paid-in capital or NT$300 million or more, the Company, unless transacting with a government agency, engaging others to build on its own land, engaging others to build on rented land, or acquiring or disposing of equipment for business use, shall obtain an appraisal report prior to the date of occurrence of the event from a professional appraiser and shall further comply with the following provisions: 1. Where due to special circumstance it is necessary to give a limited price, specific price, orspecialprice as a	1. The government agency mentioned in Paragraph 1 refers to the central and local government agencies in Republic of China. The main consideration is that the price is less likely to be manipulated during the transaction between the central and local government since it needs to be bid in accordance with regulations, therefore, experts’ advices acquiring can be omitted. As for the transaction between domestic and foreign government agencies, since relevant regulations and pricingnegotiation

	Current Articles	Explanation
give a limited price, specified price, or special price as a reference basis for the transaction price, the transaction shall be submitted for approval in advance by the board of directors; the same procedure shall also be followedwhenever there is any subsequent changeto the terms and conditions of the transaction. (Subparagraph 2~5 are not amended: omitted)	reference basis for the transaction price, the transaction shall be submitted for approval by the Board of Directors in advance, and the same procedure shall be followed for any future changes to the in case the transaction terms and conditions of the transaction. (Subparagraph 2~5 are not amended: omitted)	system are relatively unclear, it is not covered in the exemption. Hence, Paragraph 1 is amended. 2. Paragraph 1 is amended for including the “Right- of-use assets” into Article 9 in accordance to “IFRS 16.” 3. The wording in Subparagraph 1, Paragraph 1 is amended inaccordant withthelaw.
Article 10: Appraisal report for Acquisition or Disposal of Securities,intangible assets or right- of-use assets thereofor Memberships. (Subparagraph 1 is not amended: omitted) 2. Where the Company acquires or disposes of intangible assetsor right-of-use assets thereofor memberships and the transaction amount reaches 20 % or more of the Company's paid-in capital or NT$300 million or more, except in transactions with adomestic government agency, the Company shall engage a certified public accountant prior to the date of occurrence of the event to render an opinion on the reasonableness of the transaction price; the CPA shall comply with the provisions of Statement of Auditing Standards No. 20 published by the ARDF. (Subparagraph 3 is not amended: omitted)	Article 10: Appraisal report for Acquisition or Disposal of Securities andMembershipsor Intangible Assets. (Subparagraph 1 is not amended: omitted) 2. Where the Company acquires or disposes of memberships or intangible assets and the transaction amount reaches 20 % or more of the Company's paid-in capital or NT$300 million or more, except in transactions with a government agency, the Company shall engage a certified public accountant prior to the date of occurrence of the event to render an opinion on the reasonableness of the transaction price. The CPA shall comply with the provisions of statement of the Auditing Standards No. 20published by the ARDDF. (Subparagraph 3 is not amended: omitted)	The reason for the amendment is the same as the explanation 1 and 2 in Article 9. Wording amendment in Article 10 is made.
Article 11: Related Party transactions (Subparagraph 1 is not amended: omitted) 2. When the Company intends to acquireor dispose of real property or right-of-use assets thereoffrom or to a related party, or when it intends to acquire or dispose of assets other than real	Article 11: Related Party transactions (Subparagraph 1 is not amended: omitted) 2. When the Company intends to acquire real property from a related party, or when it intends to acquire or dispose of assets other than real property from or to a related party and the transaction	1. The government bonds mentioned in Subparagraph 2 means domestic government bonds. The consideration that boththe centraland

	Amended Articles	Current Articles	Explanation
property orright-of-use assets thereoffrom or to a related party and the transaction amount reaches 20 % or more of the Company’s paid-in capital, 10 % or more of the total assets, or NT$300 million or more, except in trading of domestic government bonds or bonds under repurchase and resale agreements, or subscription or redemption of money market funds issued by domestic securities investment trust enterprises, the Company may not proceed to enter into a transaction contract or make a payment until the following matters have been approved by the Board of Directors and recognized by the supervisors: (Item 1~2 are not amended: omitted) (3) With respect to the acquisition of real propertyor right-of-use assets thereof from a related party, information regarding appraisal of the reasonableness of the preliminary transaction terms in accordance withSubparagraph 3 to Subparagraph 6under the Article. (Item 4~5 are not amended: omitted) (6) An appraisal report from a professional appraiser or a CPA’s opinion in compliance with the precedingSubparagraph. (Item 7 is not amended: omitted) Where the position of independent director has been created in the Company, when a matter is submitted for discussion by the Board of Directors pursuant to Subparagraph2, the Board of Directors shall take into full consideration each independent director’s opinions. If an independent directorobjects to or		amount reaches 20 % or more of the Company's paid-in capital, 10 % or more of total assets, or NT$300 million or more, except in the trading of government bonds, bonds under repurchase and resale agreements, or subscription or redemption of money market funds issued by domestic securities investment trust enterprises, the Company may not proceed to enter into a transaction contract or make a payment until the following matters have been approved by the Board of Directors and recognized by the supervisors: (Item 1~2 are not amended: omitted) (3) With respect to the acquisition of real property from a related party, information regarding appraisal of the reasonableness of the preliminary transaction terms in accordance withParagraph 3, Paragraph 4, Paragraph 5, and Paragraph 6under the Article. (Item 4~5 are not amended: omitted) (6) An appraisal report from a professional appraiser or a CPA’s opinion in compliance with the precedingarticle. (Item 7 is not amended: omitted) Where the position of independent director has been created in the Company, when a matter is submitted for discussion by the Board of Directors pursuant to Paragraph2, the Board of Directors shall take into full consideration each independent director’s opinions. If an independent director objects to orexpressesreservations	government bonds are clear and easy for look up, therefore the procedure of submission to the Board of Directors for approval and recognition from supervisors can be omitted. As for the foreign government bond is different, hence the amendment is for domestic government bond only; in addition, Subparagraph 2 is amended for including the real property or right- of-use assets leases into Article 11 in accordance with “ITRS 16.” 2. Subparagraph 2 to Subparagraph 5 is amended for including the real property or right- of-use assets leases into Article 11 in accordance with “ITRS 16.” 3. Wording is amended.

Amended Articles	Current Articles	Explanation
expresses reservations about any matter, this shall be recorded in the minutes of the Board of Directors meeting. 3. The Company that acquires real property or right-of-use assets thereoffrom a related party shall evaluate the reasonableness of the transaction costs by the following means (where land and structures thereupon are combined as a single property purchasedor leasedin one transaction, the transaction costs for the land and the structures may be separately appraised in accordance with either of the means listed in the preceding paragraph): (Item 1~2 are not amended: omitted) 4. The Company that acquires real propertyor right-of-use assets thereoffrom a related party and appraises the cost of the real propertyor right-of-use assets thereofin accordance with Subparagraph3 shall also engage a CPA to check the appraisal and render a specific opinion. 5. Where the Company acquires real propertyor right-of-use assets thereoffrom a related party and one of the following circumstances exists, the acquisition shall be conducted in accordance withSubparagraph2, and the preceding two subparagraphsdo not apply: (1) The related party acquired the real propertyor right-of-use assets thereofthrough inheritance or as a gift. (2) More than five years will have elapsed from the time the related party signed the contract to obtain the real propertyor right-of-use assets thereofto the signing date for the current transaction. (Item 3 is not amended: omitted)	about any matter, this shall be recorded in the minutes of the Board of Directors meeting. 3. The Company that acquires real property from a related party shall evaluate the reasonableness of the transaction costs by the following means (where land and structures thereupon are combined as a single property purchased in one transaction, the transaction costs for the land and the structures may be separately appraised in accordance with either of the means listed in the preceding paragraph): (Item 1~2 are not amended: omitted) 4. The Company that acquires real property from a related party and appraises the cost of the real property in accordance with Paragraph3 shall also engage a CPA to check the appraisal and render a specific opinion. 5. Where the Company acquires real property from a related party and one of the following circumstances exists, the acquisition shall be conducted in accordance withParagraph2, and the preceding twoparagraphsdo not apply: (1) The related party acquired the real property through inheritance or as a gift. (2) More than five years will have elapsed from the time the related party signed the contract to obtain the real property and the signing date for the current transaction. (Item 3 is not amended: omitted)

	Amended Articles		Current Articles	Explanation
(4) 6.	The real property right-of-use assets for business use are acquired by the public company with its parent or subsidiaries, or by its subsidiaries in which it directly or indirectly holds 100 % of the issued shares or authorized capital. When the results of the Company’s appraisal conducted in accordance withSubparagraph 3 of the Article are uniformly lower than the transaction price for acquiring real property from the related party, the matter shall be handled in compliance with Subparagraph7. However, where the following circumstances exist, objective evidence has been submitted, and specific opinions on reasonableness have been obtained from a professional real property appraiserand a CPA,	6.	When the results of the Company’s appraisal conducted in accordance withParagraph3 of the Article are uniformly lower than the transaction price for acquiring real property from the related party, the matter shall be handled in compliance with Paragraph7. However, where the following circumstances exist, objective evidence has been submitted, and specific opinions on reasonableness have been obtained from a professional real property appraiserand a CPA,	4. Considering the risk of preceding irregular transaction for the transfer (sale or sublease) of equipment for business use that purchased or leased due to the necessity and demand in the overall plan of business, or the subleasing of leased real property between the public company and its subsidiaries in which it directly or indirectly holds 100 % of the issued shares or authorized capital are lower, Item 4 of Paragraph 5 is amended to exclude the consistent regulation that the types of transaction should follow to evaluate the cost (the price at which the related party obtains the real property or the leased payment.) Since the procedure has been excluded to be used for the types of transaction, there is no necessary to conduct in accordance with the regulations for proofing price legitimacy in Paragraph 6 of Article 11 and the special reserves of Paragraph 7 of Article 11. 5. Complying with the practical operation case of real property such as factory buildings and enlarge the acquisition of real property right-of-use assets thereof from related parties, can take the lease transaction cases in the nearby area within one year as the reference case for transaction pricing calculating and estimating. Subparagraph

Amended Articles	Current Articles	Explanation
this restriction shall not apply: (1) Where the related party acquired undeveloped land or leased land for development, it may submit proof of compliance with one of the following conditions: i. Where undeveloped land is appraised in accordance with the means in the preceding article, and structures according to the related party’s construction cost plus reasonable construction profit are valued in excess of the actual transaction price. The “reasonable construction profit” shall be deemed the average gross operating profit margin of the related party’s construction division over the most recent three years or the gross profit margin for the construction industry for the most recent period as announced by the Ministry of Finance, whichever is lower. ii. Completed transactions by unrelated parties within the preceding year involving other floors of the same property or neighboring or closely valued parcels of land, where the land area and transaction terms are similar after calculation of reasonable price discrepancies in floor or area land prices in accordance with standard property marketsale or leasing practices. (2) Where the Company acquiring real property, or obtaining real property right-of-use assets through leasing,from a related party provides evidence that the terms ofthe transactionare	this restriction shall not apply: (1) Where the related party acquired undeveloped land or leased land for development, it may submit proof of compliance with one of the following conditions: i. Where undeveloped land is appraised in accordance with the means in the preceding article, and structures according to the related party’s construction cost plus reasonable construction profit are valued in excess of the actual transaction price. The “reasonable construction profit” shall be deemed the average gross operating profit margin of the related party’s construction division over the most recent three years or the gross profit margin for the construction industry for the most recent period as announced by the Ministry of Finance, whichever is lower. ii. Completed transactions by unrelated parties within the preceding year involving other floors of the same property or neighboring or closely valued parcels of land, where the land area and transaction terms are similar after calculation of reasonable price discrepancies in floor or area land prices in accordance with standard property market practices. iii. Completed leasing transactions by unrelated parties for other floors of the same property from within the preceding year, where the transaction terms are similar after calculation of reasonable price discrepancies among floors in accordance with standard property leasing market practices. (2) Where the Company acquiring real property from a related party provides evidence that the terms of the transaction are similar to the terms of transactions completedforthe acquisitionof	6-1-3 is consolidated to Subparagraph 6-1-2, and adding lease case as the transaction example, Subparagraph 6-2 is also amended.

Amended Articles	Current Articles	Explanation
similar to the terms of completed transactions involving neighboring or closely valued parcels of land of a similar size by unrelated parties within the preceding year. (3) Completed transactionsinvolving neighboring or closely valued parcels of land in (1) and (2), in principle, refers to parcels on the same or an adjacent block and within a distance of no more than 500 meters or parcels close in publicly announced current value; transactions involving similarly sized parcels, in principle, refers to transactions completed by unrelated parties for parcels with a land area of no less than 50% of the property in the planned transaction; within the preceding year refers to the year preceding the date of occurrence of the acquisition of the real propertyor obtainment of the right-of-use assets thereof. 7. Where the Company acquires real propertyor right-of-use assets thereoffrom a related party and the results of appraisals conducted in accordance with Subparagraph3 of this Article are uniformly lower than the transaction price, the following steps shall be taken: (1) A special reserve shall be set aside in accordance with Paragraph 1 of Article 41 of the Securities and Exchange Act against the difference between the real propertyor right-of-use assets thereoftransaction price and the appraised cost, and may not be distributed or used for capital increase or issuance of bonus shares. Where the Company uses the equity method to account for its investment in another public company, the special reserve called for pursuant to law shall be set aside pro rata in a proportion consistent with the share of the Company’s equity stake in the other company.	neighboring or closely valued parcels of land of a similar size by unrelated parties within the preceding year. (3) Completed transactions for neighboring or closely valued parcels of land in (1) and (2), in principle, refers to parcels on the same or an adjacent block and within a distance of no more than 500 meters, or parcels close in publicly announced current value. Transactions for similarly sized parcels, in principle, refers to transactions completed by unrelated parties for parcels with a land area of no less than 50% of the property in the planned transaction. “Within the preceding year” refers to the year preceding the date of occurrence of the acquisition of the real property. 7. Where the Company acquires real property from a related party and the results of appraisals conducted in accordance with Paragraph3 of this Article are uniformly lower than the transaction price, the following steps shall be taken: (1) A special reserve shall be set aside in accordance with Paragraph 1 of Article 41 of the Securities and Exchange Act against the difference between the real property transaction price and the appraised cost, and it may not be distributed or used for capital increase or issuance of bonus shares. Where the Company uses the equity method to account for its investment in another public company, the special reserve called for pursuant to law shall be set aside pro rata in a proportion consistent with the share of the Company’s equity stake in the other company.	6. The preface of Subparagraph 7, Item 1, Item 4 and Item 5 are amended to include the requirements for real property right-of-use assets leases assessment when result of appraisals are lower than transaction price into the regulation in accordance with “IFRS 16.”

Amended Articles	Current Articles	Explanation
(2) Supervisors shall comply with Article 218 of the Company Act. (3) Actions taken pursuant tothe preceding two itemsshall be reported to a shareholders meeting, and the details of the transaction shall be disclosed in the annual report and any investment prospectus. (4) The Company that has set aside a special reserve under the preceding provisions may not utilize the special reserve until it has recognized a loss on decline in market value of the assets it purchasedor leasedat a premium, orthey have been disposed of,or the leasing contract has been terminated,or adequate compensation has been made, or the status quo ante has been restored, or there is other evidence confirming that there was nothing unreasonable about the transaction, and the FSC has given its consent. (5) The Companyobtains real property or right-of-use assets thereof from a related party,shall also comply with the preceding fouritemsif there is other evidence indicating that the acquisition was not an arm’s length transaction. 8. With respect to thetypes of transactions listed below, when to be conductedbetween the Company and its parent or subsidiaries,or between its subsidiaries in which it directly or indirectly holds 100 % of the issued shares or authorized capital,the Company shall make arrangements in accordance with the Approval Authorization Table and have the decisions deliberated by the unit in charge. Subsequently the finance unit shall submit the relevant data to be ratified by the next Board of Directors meeting. (1) Acquisition or disposal of equipment or right-of-use assets thereof held for business use.	(2) Supervisors shall comply with Article 218 of the Company Act. (3) Actions taken pursuant to Subparagraph (1) and (2)shall be reported to a shareholders meeting, and the details of the transaction shall be disclosed in the annual report and any investment prospectus. (4) The Company that has set aside a special reserve under the preceding provisions may not utilize the special reserve until it has recognized a loss on decline in market value of the assets it purchased at a premium, they have been disposed of, adequate compensation has been made, or the status quo ante has been restored, or there is other evidence confirming that there was nothing unreasonable about the transaction, and the FSC has given its consent. (5) The Company shall also comply with the preceding four subparagraphsif there is other evidence indicating that the acquisition was not an arm’s length transaction. 8. With respect to theacquisition or disposal of business-use equipmentbetween the Company and its parent or subsidiaries, the Company shall make arrangements in accordance with the Approval Authorization Table and have the decisions deliberated by the unit in charge. Subsequently the finance unit shall submit the relevant data to be ratified by the next Board of Directors meeting.	7. The wording in preface of Subparagraph 7 and Item 3 is amended in accordance with the legal process. 8. Considering transaction risk of the transfer (sale or sublease) of equipment for business use that purchased or leased due to the necessity and demand in the overall plan of business, or the subleasing of leased real property between the public company and its subsidiaries in which it directly or indirectly holds 100 % of the issued shares or authorized capital are lower, word amending in Subparagraph 8 to enlarge the limitation to pre-determinedlimit

Amended Articles	Current Articles	Explanation
(2) Acquisition or disposal of real property right-of-use assets held for business use.		delegated to the Chairperson by the Board of Directors to facilitate execution.
Article 11-1: The calculation of the transaction amounts referred to in Article 9, Article 10 and Subparagraph1 of Article 11 shall be made in accordance with Subparagraph2 of Article 14 herein, and “within the preceding year” as used herein refers to the year preceding the date of occurrence of the current transaction. Items for which an appraisal report from a professional appraiser or a CPA’s opinion has been obtained need not be counted toward the transaction amount. The calculation of the transaction amounts referred to inSubparagraph 2 of Article 11 shall be made in accordance withSubparagraph2 of Article 14 herein. “Within the preceding year” as used herein refers to the year preceding the date of occurrence of the current transaction. Items that have been approved by the Board of Directors and recognized by the supervisors need not be counted toward the transaction amount.	Article 11-1: The calculation of the transaction amounts referred to in Article 9, Article 10 andParagraph 1 of Article 11 shall be made in accordance withParagraph2 of Article 14 herein, and “within the preceding year” as used herein refers to the year preceding the date of occurrence of the current transaction. Items for which an appraisal report from a professional appraiser or a CPA’s opinion has been obtained need not be counted toward the transaction amount. The calculation of the transaction amounts referred to inParagraph2 of Article 11 shall be made in accordance withParagraph2 of Article 14 herein. “Within the preceding year” as used herein refers to the year preceding the date of occurrence of the current transaction. Items that have been approved by the Board of Directors and recognized by the supervisors need not be counted toward the transaction amount.	The wording in articles are amended.
Article 12: Engaging in Derivatives Trading (Subparagraph 1~7 are not amended: omitted) 8. Internal control (Item 1~2 are not amended: omitted) (3) Periodic evaluation i. A finance supervisor appointed by the Board of Directors shall pay attention to the supervision and control of risks arising from derivatives trading at all times. The finance supervisor shall also make periodic evaluations on whether the performance of the transaction complies with the existing business strategies and	Article 12: Engaging in Derivatives Trading (Subparagraph 1~7 are not amended: omitted) 8. Internal control (Item 1~2 are not amended: omitted) (3) Periodic evaluation i. A finance supervisor appointed by the Board of Directors shall pay attention to the supervision and control of risks arising from derivatives trading at all times. The finance supervisor shall also make periodic evaluations on whether the performance of the transaction complies with the existing business strategies and	1. The wording in Item 3-3, Subparagraph 8 is amended.

	Amended Articles	Current Articles	Explanation
whether the risks undertaken fall within a tolerable scope. ii. The finance supervisor shall make periodic evaluations of whether existing risk management procedures are properly and realistically carried out in accordance with the Procedures. iii. Hedging transactions carried out based on business needs shall be evaluated every two weeks, and such evaluation reports shall be submittedto the senior supervisor authorized by the Board of Directors. (Item 3-4~3-5 are not amended: omitted) 9. Internal audit system (1) Internal auditors shall, pursuant to the Procedures, understand the suitability of internal control for derivatives trading on a regular basis, audit the trading department's compliance with the “Procedure for Acquisition and Disposal of Assets”, analyze the trading cycle on a monthly basis, and prepare an audit report. In the event of discoveries of material violations, a written notice shall be submitted to the supervisors. Where independent directors have been appointed in accordance with the provisions of the Act, for matters for which notice shall be given to the supervisors under the preceding paragraph, written notice shall also be given to the independent directors. (Item 2 isnot amended: omitted)		whether the risks undertaken fall within a tolerable scope. ii. The finance supervisor shall make periodic evaluations of whether existing risk management procedures are properly and realistically carried out in accordance with the Procedures. iii. Hedging transactions carried out based on business needs shall be evaluated every two weeks, and such evaluation reports shall be reported to the senior supervisor authorized by the Board of Directors. (Item 3-4~3-5 are not amended: omitted) 9. Internal audit system (1) Internal auditors shall, pursuant to the Procedures, understand the suitability of internal control for derivatives trading on a regular basis, audit the trading department's compliance with the “Procedure for Acquisition and Disposal of Assets”, analyze the trading cycle on a monthly basis, and prepare an audit report. In the event of discoveries of material violations, a written notice shall be submitted to the supervisors. (Item 2 isnot amended: omitted)	2. In pursuant to the spirit of implementing audit procedures which mentioned in Article 15 of Regulations Governing Establishment of Internal Control Systems by Public Companies, the amendment that a written notice shall be submitted to the independent directors in the event of discoveries of material violations while independent directors have been appointed is added.
Article 14: Procedures for Public Disclosure of Information 1. Under any of the following circumstances, the Company acquiring or disposing of assets shall publicly announce and report the relevant information on the FSC’s designated website in the appropriate format as prescribed byregulations within 2		Article 14: Procedures for Public Disclosure of Information 1. Under any of the following circumstances, the Company acquiring or disposing of assets shall publicly announce and report the relevant information on the FSC’s designated website in the appropriate format as prescribed byregulations within 2days	1. To amend the government bonds section in Paragraph 1-1- 1 and 1-1-6 due to the consideration that both the central and government debt are clearand easyfor look

Amended Articles	Current Articles	Explanation
days counting inclusively from the date of occurrence of the event: (1) Acquisition or disposal of real propertyor right-of-use assets thereoffrom or to a related party, or acquisition or disposal of assets other than real propertyor right-of-use assets thereoffrom or to a related party where the transaction amount reaches 20 % or more of the Company's paid-in capital, 10 % or more of total assets, or NT$300 million or more; provided, this shall not apply to the trading ofdomestic government bonds or bonds under repurchase and resale agreements, or subscription or redemption of money market funds issued by domestic securities investment trust enterprises. (Item 2 is not amended: omitted) (3) Losses from derivatives trading reaching the limits on aggregate losses or losses on individual contracts set out in the Procedures. (4) Where equipmentor right-of-use assets thereoffor business use are acquired or disposed of, and furthermore the transaction counterparty is no related arty, and the transaction amount meets any of the following criteria: i. For a public company whose paid-in capital is less than NT$10 billion, the transaction amount reaches NT$500 million or more. ii. For a public company whose a paid-in capital is NT$10 billion or more, the transaction amount reaches NT$1 billion or more. (5) Where land is acquired under an arrangement on engaging others to build on the Company’s own land, engaging others to build on rented land, joint construction and allocation of housing units, joint construction and allocation of ownership percentages, or joint constructionand separate sale,	counting inclusively from the date of occurrence of the event: (1) Acquisition or disposal of real property from or to a related party, or acquisition or disposal of assets other than real property from or to a related party where the transaction amount reaches 20 % or more of the Company's paid-in capital, 10 % or more of total assets, or NT$300 million or more. This shall not apply to the trading of government bonds, bonds under repurchase and resale agreements, or subscription or redemption of money market funds issued by domestic securities investment trust enterprises. (Item 2 is not amended: omitted) (3) Losses from derivatives trading reaching the limits on aggregate losses or losses on individual contracts set out in the Procedures. (4) Where the type of assets acquired or disposed of is equipment for business use, the trading counter- party is not a related party, and the transaction amount meets any of the following criteria: i. For a public company whose paid- in capital less than NT$10 billion, the transaction amount reaches NT$500 million or higher. ii. For a public company whose a paid-in capital is NT$10 billion or more, and the transaction amount reaches NT$1 billion or more. (5) Where land is acquired under an arrangement on engaging others to build on the Company’s own land, engaging others to build on rented land, joint construction and allocation of housing units, joint construction and allocation of ownership percentages, or joint constructionand separate sale,	up, therefore the announcement can be omitted. As for the foreign government bond is different, hence the amendment is for domestic government bond only. 2. To amend Subparagraph 1-1, 1-4, and 2-3 including the right-of-use assets in accordance with “IFRS 16.” 3. Considering to fact that the regulation announced in Item 1 of Subparagraph 1 has stipulated the transaction between related party while Item 5 regulates the circumstances of non- related transaction counterparty, hence, Item 5 is amended for the Company compliance. 4. The wording in Subparagraph 1-1 and 1- 3 are amended in accordance with the legal process.

	Amended Articles	Current Articles	Explanation
and furthermore the transaction counterparty is not a related party,and the amount the Company expects to invest in the transaction reaches NT$500 million. (6) Where an asset transaction other than any of those referred to in the preceding five items, a disposal of receivables by a financial institution, or an investment in the Mainland China area reaches 20 % or more of paid-in capital or NT$300 million. This shall not apply to the following circumstances: i. Trading ofdomesticgovernment bonds. ii. Trading of bonds under repurchase and resale agreements, or subscription or redemption of money market funds issued by domestic securities investment trust enterprises. 2. The amount of transactions above shall be calculated as follows: (Item 1~2 are not amended: omitted) (3) The cumulative transaction amount of acquisitions and disposals (cumulative acquisitions and disposals, respectively) of real propertyor right-of-use assets thereofwithin the same development project within the preceding year. (Item 4 is not amended: omitted) 3. “Within the preceding year”, as used in the preceding Subparagraph, refers to the year preceding the date of occurrence of the current transaction. Items duly announced in accordance with the Procedures need not be counted toward the transaction amount.		and the amount the Company expects to invest in the transaction reaches NT$500 million. (6) Where an asset transaction other than any of those referred to in the preceding five items, a disposal of receivables by a financial institution, or an investment in the Mainland China area reaches 20 % or more of paid-in capital or NT$300 million. This shall not apply to the following circumstances: i. Trading of government bonds. ii. Trading of bonds, under repurchase and resale agreements, or subscription or repurchase of money market funds issued by domestic securities investment trust enterprises. 2. The amount of transactions above shall be calculated as follows: (Item 1~2 are not amended: omitted) (3) The cumulative transaction amount of real property acquisitions and disposals (cumulative acquisitions and disposals, respectively) within the same development project within the preceding year. (Item 4 is not amended: omitted) 3. “Within the preceding year”, as used in the preceding paragraph, refers to the year preceding the date of occurrence of the current transaction. Items duly announced in accordance with the Procedures need not be counted toward the transaction amount.	5. The wording in Subparagraphs are amended.

Amended Articles	Current Articles	Explanation
4. The Company shall compile monthly reports on the status of derivatives trading engaged in up to the end of the preceding month by itself and any subsidiaries that are not domestic public companies and enter the information in the prescribed format into the information reporting website designated by the FSC by the 10th day of each month. (Subparagraph 5 is not amended: omitted) 6. When acquiring or disposing of assets, the Company shall keep all relevant contracts, meeting minutes, log books, appraisal reports and CPA, attorney, and securities underwriter opinions at the Company, where they shall be retained for at least five years except where another act provides otherwise. (Subparagraph 7 is not amended: omitted)	4. The Company shall compile monthly reports on the status of derivatives trading engaged in up to the end of the preceding month by itself and any subsidiaries that are not domestic public companies and enter the information in the prescribed format into the information reporting website designated by the FSC by the 10th day of each month. (Subparagraph 5 is not amended: omitted) 6. When acquiring or disposing of assets, the Company shall keep all relevant contracts, meeting minutes, log books, appraisal reports and CPA, attorney, and securities underwriter opinions at the Company, where they shall be retained for at least five years, except where another act provides otherwise. (Subparagraph 7 is not amended: omitted)	6. The wording in Subparagraph 4 and Subparagraph 6 are amended. (Only for the Chinese version)
Article 15: Management of Subsidiaries (Subparagraph 1 is not amended: omitted) 2. Where a subsidiary invested in by the Company is not a domestic public company, and when acquisitions and disposals of assets meet the standards for public announcements and reporting, the Company shall also make an announcement and reporting and send a copy. In accordance with the subsidiary’s standards for public announcements and reporting, “the Company’s paid-in capital”, as used therein, shall be based on the Company's paid-in capital.	Article 15: Management of Subsidiaries (Subparagraph 1 is not amended: omitted) 2. Where a subsidiary invested in by the Company is not a domestic public company, and when acquisitions and disposals of assets meet the standards for public announcements and reporting, the Company shall also make an announcement and reporting and send a copy. In accordance with the subsidiary's standards for public announcements and reporting, “20 percent or more ofthe Company’s paid-in capital”, as used therein, shall be based on the Company's paid-in capital.	The public announcements and reporting standard of Subsidiary shall be the same as the parent company. Hence Subparagraph 2 is amended for Subsidiary to apply the standard.

	Amended Articles	Current Articles	Explanation
	Article 16: For the calculation of 10 % of total assets under the Procedures, the total assets stated in the most recent parent company only financial statement or individual financial statement in conformity with the Regulations Governing the Preparation of Financial Reports by Securities Issuers. In the case of the Company whose shares have no par value or a par value other than NT$10 per share, for the threshold of transaction amounts of 20 % of paid-in capital under the procedure shall be replaced by 10 % of equity attributable to owners of the parent; for the threshold of transaction amounts of NT$10 billion of paid-in capital under the procedure shall be replaced by NT$20 billion of equity attributable to owners of the parent. (Article 17~19 are not amended: omitted)	Article 16: For the calculation of 10 % of total assets under the Procedures, the total assets stated in the most recent parent company only financial statement or individual financial statement in conformity with the Regulations Governing the Preparation of Financial Reports by Securities Issuers. In the case of the Company whose shares have no par value or a par value other than NT$10 per share, for the threshold of transaction amounts of 20 % of paid-in capital under the procedure shall be replaced by 10 % of equity attributable to owners of the parent. (Article 17~19 are not amended: omitted)	The calculation method of paid-in capital of NT$10 billion mentioned in Article 14 is added into the post section of Paragraph 2 to stipulate circumstance that the Company whose shares have no par value or a par value other than NT$10.
	Article 20 The Procedures were established on June 10, 2003 The first amendment was on June 9, 2004 The second amendment was on June 12, 2006 The third amendment was on June 21, 2007 The fourth amendment was on June 15, 2012 The fifth amendment was on June 19, 2014 The sixth amendment was on June 8, 2017 The seventh amendment was on May 29, 2019	Article 20 The Procedures were established on June 10, 2003 The first amendment was on June 9, 2004 The second amendment was on June 12, 2006 The third amendment was on June 21, 2007 The fourth amendment was on June 15, 2012 The fifth amendment was on June 19, 2014 The sixth amendment was on June 8, 2017	Based on the date on which a resolution will be made at the shareholder’s meeting.

Attachment 9: Comparison Table of the “Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees” Amendments

104 Corporation

Comparison Table of the “Regulations Governing Loaning of Funds and Makin g of Endorsements/Guarantees” Amendments

	Current Articles	Explanation
Article 2: Basis The Procedures are adopted in accordance with Article 36-1 of the Securities and Exchange Act and the “Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Company” stipulated by Financial Supervisory Commission (FSC.)	Article 2: Basis The Procedures are adopted in accordance with Article 36-1 of the Securities and Exchange Act and the “Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Company” stipulated by Financial Supervisory Commission (FSC.)	Wording is amended. (Only for the Chinese version)
Article 4: Total Amount of Funds Lending and Limit for Each Recipient (Paragraph 1 is not amended: omitted) Except for the aggregate amount mentioned in preceding 2	Article 4: Total Amount of Funds Lending and Limit for Each Recipient (Paragraph 1 is not amended: omitted) Except for the aggregate amount mentioned in preceding 2paragraphs,	1. Wording is amended. 2. To amend Paragraph 3 stipulating that when company lending arrangement exceed the aggregate amount, the resonsible erson of a
subparagraphs,where an inter- company or inter-firm business transaction calls for such lending arrangement; or where an inter- company or inter-firm short-term financing facility is necessary provided that the amount of such financing facility shall not exceed 20 % of the amount of parent company net worth audited by an independent certified public accountant or stated in its latest financial statement. The responsible person of a company	where an inter-company or inter-firm business transaction calls for such lending arrangement; or where an inter-company or inter-firm short-term financing facility is necessary provided that the amount of such financing facility shall not exceed 20 % of the amount of parent company net worth audited by an independent certified public accountant or stated in its latest financial statement.	p p company shall be liable in accordance with Article 15 of “Company Act.”
who has violated the provisions of the
Paragraph 1 and the preceding Paragraph shall be liable, jointly and severally with the borrower, for the repayment of the loan at issue and for
the damages, if any, to company resulted there-from.
Article 6: When lending funds to others, beside to reach the requirements mentioned in Article 3, the Finance division shall audit a detailed review procedure and make evaluation result, including: (Paragraph 1~4 are not amended: omitted)	Article 6: When lending funds to others, beside to reach the requirements mentioned in Article 3, the Finance division shall audit a detailed review procedure and make evaluation result, including: (Paragraph 1~4 are not amended: omitted)	Wording is amended. (Only for the Chinese version)

Amended Articles	Amended Articles	Current Articles	Explanation
Where the Company has established the position of independent director, when Loaning Funds to Others for discussion by the Board of Directors under the preceding paragraph, the Board of Directors shall take into full consideration each independent director's opinion; independent directors' opinions specifically expressing assent or dissent and their reasons for dissent shall be included in the minutes of the Board of Directors' meeting.		Where the Company has established the position of independent director, when Loaning Funds to Others for discussion by the Board of Directors under the preceding paragraph, the Board of Directors shall take into full consideration each independent director's opinion; independent directors' opinions specifically expressing assent or dissent and their reasons for dissent shall be included in the minutes of the Board of Directors' meeting.
Article 7: Additional Guidelines of Lending Funds to Others (Paragraph 1 is not amended: omitted) 2. The Finance Division of the Company shall list out the voucher for obtained collaterals or credit guarantee notes and set up a record book for recording the details of the entity to which the lending of funds is made, amount, date of approval by the Board of Directors, drawdown date, and matters to be carefully evaluated in accordance with the Article 6 after each lending f funds has been made. The Company shall evaluate the status of its loans of funds and reserve sufficient allowance for bad debts, and shall adequately disclose fund lendinginformation in its financial reports and provide certified public accountants with relevant information for implementation of necessary auditing procedures.		Article 7: Additional Guidelines of Lending Funds to Others (Paragraph 1 is not amended: omitted) 2. The Finance Division of the Company shall list out the voucher for obtained collaterals or credit guarantee notes and set up a record book for recording the details of the entity to which the lending of funds is made, amount, date of approval by the Board of Directors, drawdown date, and matters to be carefully evaluated in accordance with the Article 6 after each lending f funds has been made. The Company shall evaluate the status of its loans of funds and reserve sufficient allowance for bad debts, and shall adequately disclose relevantinformation in its financial reports and provide certified public accountants with relevant information for implementation of necessary auditing procedures.	Wording is amended.
Article 8: Guidelines of Funds Lent (Paragraph 1~3 are not amended: omitted) 4. If, as a result of a change in circumstances, an entity for which		Article 8: Guidelines of Funds Lent (Paragraph 1~3 are not amended: omitted) 4. If, as a result of a change in circumstances, an entity for which	In order to enhance company governance, any of the material violation of the funds lending or endorsement/guarantee procedures shall promptly be notified to the independent
	an endorsement/guarantee is made does not meet the requirements of Article 3 or the loan balance exceeds the limit, the Company shall adopt rectification plans and submit the rectification plans to all the supervisors andindependent directors, and shall complete the	an endorsement/guarantee is made does not meet the requirements of Article 3 or the loan balance exceeds the limit, the Company shall adopt rectification plans and submit the rectification plans to all the supervisors, and shall complete the rectification according to the	directors in writing; the corrective plans for the correcting the violation shall also be sent.

	Amended Articles	Current Articles	Explanation
	rectification according to the timeframe set out in the plan.	plan.
Article 10: The term “endorsements/guarantees” as used in these Procedure refers to the following: (Subparagraph 1~2 are not amended: omitted) 3. Other endorsements/guarantees, meaning endorsements or guarantees beyond the scope of the above twosubparagraphs. (Paragraph 2 isnot amended: omitted)		Article 10: The term “endorsements/guarantees” as used in these Procedure refers to the following: (Subparagraph 1~2 are not amended: omitted) 3. Other endorsements/guarantees, meaning endorsements or guarantees beyond the scope of the above twoparagraphs. (Paragraph 2 isnot amended: omitted)	Wording is amended.
Article 12: Hierarchy of decision- making authority and delegation thereof of endorsements/guarantees (Subparagraph 1~3 are not amended: omitted) 4. Where the Company has established the position of independent director, when it submits its Operational Procedures for Loaning Funds to Others for discussion by the Board of Directors under the preceding 2 subparagraphs,the board of directors shall take into full consideration each independent director's opinion; independent directors' opinions specifically expressing assent or dissent and their reasons for dissent shall be included in the minutes of the board of directors'meeting.		Article 12: Hierarchy of decision- making authority and delegation thereof of endorsements/guarantees (Subparagraph 1~3 are not amended: omitted) 4. Where the Company has established the position of independent director, when it submits its Operational Procedures for Loaning Funds to Others for discussion by the Board of Directors under the preceding 2 paragraphs,the board of directors shall take into full consideration each independent director's opinion; independent directors' opinions specifically expressing assent or dissent and their reasons for dissent shall be included in the minutes of the board of directors' meeting.	Wording is amended.
Article 14: Where as a result of changes of condition the entity for which an endorsement/guarantee is made no longer meets the requirements of these Regulations, or the amount of endorsement/guarantee exceeds the limit, the Finance Division shall adopt rectification plans, which the chairman has approved to discharge the amount in excess within a given time limit, and submit the rectification plans to all the supervisorsand independent directors in Board of Directors, and shall complete the rectification according to the timeframe set out in the plan.		Article 14: Where as a result of changes of condition the entity for which an endorsement/guarantee is made no longer meets the requirements of these Regulations, or the amount of endorsement/guarantee exceeds the limit, the Finance Division shall adopt rectification plans, which the chairman has approved to discharge the amount in excess within a given time limit, and submit the rectification plans to all the supervisors in Board of Directors, and shall complete the rectification according to the timeframe set out in the plan.	In order to enhance company governance, any of the material violation of the funds lending or endorsement/guarantee procedure shall promptly be notified to the independent directors in writing; the corrective plans for the correcting the violation shall also be sent.

Amended Articles	Current Articles	Explanation
Article 16: Procedures for Public Disclosure of Information (Subparagraph 1 is not amended: omitted) 2. The company whose loans of funds reach one of the following levels shall announce and report such event on the FSC's designated website in the appropriate format within two days commencing immediately from the date of occurrence. “Date of occurrence” in these Regulations means the date of contract signing, date of payment, dates of board of directors resolutions, or other date that can confirm theentities to which the company may loan fundsand monetary amount, whichever date is earlier: (Item 1~3 are not amended: omitted) 3. The company whose amount of endorsement/guarantee reach one of the following levels shall announce and report such event on the FSC's designated website in the appropriate format within two days commencing immediately from the date of occurrence. “Date of occurrence” in these Regulations means the date of contract signing, date of payment, dates of board of directors resolutions, or other date that can confirm theentity for which the endorsement/guarantee is madeand monetary amount, whichever date is earlier: (Item 1~2 are not amended: omitted) (3) The balance of endorsements/guarantees by the Company and its subsidiaries for a single enterprise reaches NT$10 million or more and the aggregate amount of all endorsements/guarantees for,book value of investment in equity method in,and balance of loans to, such enterprise reaches 30 percent or more ofpublic company'snet	Article 16: Procedures for Public Disclosure of Information (Subparagraph 1 is not amended: omitted) 2. The company whose loans of funds reach one of the following levels shall announce and report such event on the FSC's designated website in the appropriate format within two days commencing immediately from the date of occurrence. “Date of occurrence” in these Regulations means the date of contract signing, date of payment, dates of board of directors resolutions, or other date that can confirm thecounterpartyand monetary amountof the transaction,whichever date is earlier: (Item 1~3 are not amended: omitted) 3. The company whose amount of endorsement/guarantee reach one of the following levels shall announce and report such event on the FSC's designated website in the appropriate format within two days commencing immediately from the date of occurrence. “Date of occurrence” in these Regulations means the date of contract signing, date of payment, dates of board of directors resolutions, or other date that can confirm thecounterparty and monetary amountof the transaction,whichever date is earlier: (Item 1~2 are not amended: omitted) (3) The balance of endorsements/guarantees for a single enterprise reaches NT$10 million or more and the aggregate amount of all endorsements/guarantees for, investment of a long-term nature in, and balance of loans to, such enterprise reaches 30 percent or more of Company's net worth as statedin itslatestfinancial	1. To amend wording in Subparagraph 2 and Subparagraph 3 concerning the funds lending and endorsement/guarantee are not nature of transaction. 2. To amend Subparagraph 3- 3 pursuant to Article 9-4-1 of “Regulations Governing the Preparation of Financial Reports by Securities Issuers” stipulating the definition of investment of a long-term nature in. 3. Wording is amended.

Amended Articles	Current Articles	Explanation
worth as stated in its latest financial statement. (Item 4 is not amended: omitted) The Company shall announce and report on behalf of any subsidiary thereof that is not a public company of the Republic of China any matters that such subsidiary is required to announce and report pursuant to Subparagraph2-3 andSubparagraph 3-4ofthe preceding paragraph.	statement, or, after announcement or reporting is made. (Item 4 is not amended: omitted) The Company shall announce and report on behalf of any subsidiary thereof that is not a public company of the Republic of China any matters that such subsidiary is required to announce and report pursuant to Paragraph2-3 andParagraph3-4 of the preceding paragraph.
Article 18: The internal auditors shall audit the Operational Procedures for Loaning Funds to Others and the implementation thereof no less frequently than quarterly and prepare written records accordingly. They shall promptly notify all the supervisorsand independent directors in writing of any material violation found.	Article 18: The internal auditors shall audit the Operational Procedures for Loaning Funds to Others and the implementation thereof no less frequently than quarterly and prepare written records accordingly. They shall promptly notify all the supervisors in writing of any material violation found.	In order to enhance company governance, any of the material violation of the funds lending or endorsement/guarantee procedures shall promptly be notified to the independent directors in writing; the corrective plans for the correcting the violation shall also be sent.
Article 21: The Company shall formulate its Operational Procedures for Endorsements/Guarantees in compliance with these Regulations, and, after passage by the Board of Directors, submit the same to each supervisor and for approval by the shareholders’ meeting. Where there any director expresses dissent and it is contained in the minutes or a written statement, the company shall submit the dissenting opinions to each supervisor and for discussion by the shareholders’ meeting. The same shall apply to any amendments to the Procedures. Where the Company has established the position of independent director, when it submits the Operational Procedures for Endorsements/Guarantees for discussion by the Board of Directors pursuant to the preceding paragraph, the Board of Directors shall take into	Article 21: The Company shall formulate its Operational Procedures for Endorsements/Guarantees in compliance with these Regulations, and, after passage by the Board of Directors, submit the same to each supervisor and for approval by the shareholders’ meeting. Where there any director expresses dissent and it is contained in the minutes or a written statement, the company shall submit the dissenting opinions to each supervisor and for discussion by the shareholders’ meeting. The same shall apply to any amendments to the Procedures.	Wording is amended in accordance with Article 14-3 of Securities and Exchange Act.
full consideration each independent director's opinions; the independent directors'opinions specifically expressing assent or dissent and the reasons for dissent shall be included

Amended Articles	Current Articles	Explanation
in the minutes of the Board of Directors'meeting.
Article 22: The Procedure was established on June 10,2003 The first amendment was on June 9, 2004 The second amendment was on June 12, 2006 The third amendment was on June 21, 2007 The fourth amendment was on June 11, 2008 The fifth amendment was on June 10, 2009 The sixth amendment was on June 17, 2010 The seventh amendment was on June 9, 2011 The eighth amendment was on June 15, 2012 The ninth amendment was on June 28, 2013 The tenth amendment was on May 29,	Article 22: The Procedure was established on June 10,2003 The first amendment was on June 9, 2004 The second amendment was on June 12, 2006 The third amendment was on June 21, 2007 The fourth amendment was on June 11, 2008 The fifth amendment was on June 10, 2009 The sixth amendment was on June 17, 2010 The seventh amendment was on June 9, 2011 The eighth amendment was on June 15, 2012 The ninth amendment was on June 28, 2013	Based on the date on which a resolution will be made at the shareholder’smeeting.
2019

Appendix

Appendix 1: Rules and Procedures of Shareholders’ Meetings (Before Amendments)

104 Corporation

Rules and Procedures of Shareholders’ Meetings

2015/06/24 Article 1 ： Except as otherwise provided by law or the articles of incorporation, shareholders’ meetings of the Company shall be conducted in accordance with these Rules and Procedures. Article 2 ： Except as otherwise provided by law, shareholders’ meetings of the Company shall be convened by the board of directors. Article 3 ： The reason(s) for calling a meeting shall be specified in the meeting notifications and notices, and a shareholder may be informed via electronic means upon his/her approval. Article 4 ： A shareholders’ meeting shall be held at the head office of the Company or at an appropriate venue convenient for shareholders to attend and shall not begin earlier than 9:30 a.m. or later than 3:00 p.m. Article 5 ： Shareholders or appointed proxies (hereinafter referred to as “Shareholders”) shall attend a shareholders’ meeting on an attendance card, a sign-in card or other certificates of attendance. Proxy solicitors shall also present identification documents for verification. Attending shareholders shall submit their sign-in cards in lieu of signing in. Article 6 ： A shareholders’ meeting convened by the board of directors shall be presided over by the chairperson of the board of directors. If the chairperson of the board of directors is on leave or, for some reason, is unable to exercise his/her authority, the vice chairperson of the board of directors shall act on his/her behalf. In the absence of a vice chairperson or in the case of the vice chairperson also being on leave or unable to carry out such a duty for some reason, the chairperson shall designate one of the managing directors to preside as chair. In the absence of managing directors, the chairperson shall appoint one of the other directors to chair the meeting. Without any such designation, managing directors or the other directors shall elect an acting chair for the meeting from among themselves. A shareholders’ meeting not called by the board of directors but by any other person entitled to convene such a meeting shall be presided over by the person convening the meeting. Article 7 ： The Company may appoint its lawyers(s), accountant(s) or other relevant persons to attend a shareholders’ meeting. Article 8 ： The Company shall make an audiotape or videotape recording of a shareholders’ meeting in its entirety, and such recording shall be retained for at least one year. Article 9 ： The attendance and voting at a shareholders’ meeting shall be calculated based on the number of shares. The shares held by shareholders who are without voting rights shall be excluded from the total number of shares in the issue when voting on a resolution at a shareholders’ meeting. The number of attending shares shall be calculated according to the number of sign-in cards submitted and the number of shares voted in writing. Article 10 ： The chair shall call the meeting to order at the time scheduled. However, the chair may postpone the meeting, two times at the maximum (20 minutes for the 1[st] postponement and 10 minutes for the 2[nd] postponement), if the number of shares represented by the shareholders in attendance falls short of one-half of the total number of shares in issue. If, after two postponements as described above, the number of shares represented by

the shareholders in attendance is still short of the quorum but over one-third of all shares issued, a tentative resolution, with majority approval of voting shareholders in attendance, may be adopted in accordance with Article 175 of the Company Act. All shareholders shall be informed of the tentative resolution, and another shareholders’ meeting shall be convened within one month’s time.

Prior to the conclusion of the meeting, if the number of shares represented by the shareholders in attendance surpasses one-half of the total number of shares in issue, the chair may call for a re-voting of the tentative resolution by attending shareholders in accordance with Article 174 of the Company Act.

Article 11 ： For a shareholders’ meeting convened by the board of directors, the meeting’s agenda shall be set by the board of directors, and the meeting shall proceed as set by the agenda unless otherwise changed by a resolution passed in the shareholders’ meeting. The provision prescribed in the preceding paragraph shall also apply to a shareholders’ meeting not called by the board of directors but by any other person entitled to convene such a meeting. Article 12 ： During discussion of a motion, the chair may announce the conclusion of discussion at an appropriate time and may terminate the discussion when necessary. Article 13 ： A motion concluded or terminated of discussion by the chair shall be submitted for a vote immediately. Article 14 ： Before an attending shareholder makes a speech, a slip specifying the key points of the speech, the shareholder’s account number (or attendance card number), and the account name must first be filled out, and any attending shareholder wishing to speak shall do so in the order determined by the chair. An attending shareholder who has submitted the slip to speak but does not actually make a speech shall be regarded as not having spoken. The contents of the speech shall prevail over the contents of the slip if there is any inconsistency. When an attending shareholder makes a speech, other shareholders shall not interrupt the speech without the permission of the chair and the speaking shareholder. The chair shall stop anyone committing such a violation. Article 15 ： A shareholder may not speak more than twice regarding the same proposal. Article 16 ： A shareholder’s speech may not exceed 5 minutes; however, a 3-minute extension, allowed once only, may be granted upon the chair’s permission. After an attending shareholder makes his/her speech, the chair may respond personally or may appoint a relevant person to make the response. Article 17 ： When a shareholder’s speech exceeds the time limit or goes outside of the scope of the topic in discussion, the chair may stop his/her speech at any time. Article 18 ： When a corporation attends a shareholders’ meeting as the proxy, only one person may be appointed as its representative at the meeting. When a corporate shareholder appoints two persons as its representatives at a shareholders’ meeting, only one person may speak on each particular motion in discussion. Article 19 ： Every shareholder shall have one vote for each share held; however, shareholders who are subject to restrictions or without voting rights as provided in Paragraph 2, Article 179 of the Company Act shall be excluded. Unless otherwise provided by the Company Act and the Company’s Articles of Incorporation, a motion put to a vote shall be approved by the majority of votes represented by the shareholders in attendance. For the voting, if no objection is voiced after an inquiry by the chair, a motion shall be deemed as approved with the same effect as votes cast. Article 20 ： If there is an amendment or a substitute proposal to a motion in discussion, the chair shall decide on their order of vote along with the original motion. If one of them has been approved, the others shall be deemed rejected and no further voting is required. Article 21 ： Persons responsible for monitoring and counting the ballots during a vote shall be

appointed by the chair; however, the person(s) monitoring the vote shall be a shareholder(s).

Vote counting for shareholders meeting proposals or elections shall be conducted in public at the place of the shareholders meeting. Immediately after vote counting has been completed, the results of the voting, including the statistical tallies of the numbers of votes, shall be announced on-site at the meeting, and a record made of the vote. Article 22 ： The chair may direct disciplinary officers (or security guards) to help maintain order at the meeting venue. When assisting in keeping order at the venue, disciplinary officers (or security guards) shall wear arm-bands marked “Disciplinary Officer”. If the venue is equipped with sound amplification equipment, the chair may stop a shareholder from speaking when he/she speaks using an apparatus not installed by the Company. The chair may direct disciplinary officers (or security guards) to escort any shareholder who violates these Rules and Procedures, fails to abide by the chair’s correction or interferes with the progress of the meeting and fails to comply after being asked to refrain out of the meeting venue. Article 23 ： During the meeting, the chair may, at his/her discretion, set time for a recess. In case of an incident of force majeure, the chair may temporarily suspend the meeting and shall decide how and when the meeting will resume. Article 24 ： All resolutions reached at a shareholders’ meeting shall be compiled in the form of meeting minutes. The meeting minutes shall be signed or stamped by the chair and shall be distributed to each shareholder within 20 days of the meeting. The company may distribute the meeting minutes to shareholders who hold less than 1,000 shares of registered stock in the form of an announcement on the Market Observation Post System (MOPS). The date (year, month, and day) and place of the meeting, the name of the chairperson, the resolution method, the summary of proceedings, and outcomes of the meeting shall be faithfully recorded in the meeting minutes, and the meeting minutes shall be permanently retained as along as the Company exists. Regarding the resolution method as mentioned in the preceding paragraph, “approved without objection from any attending shareholder following the chair’s inquiry” shall be recorded in the meeting minutes if no objection is voiced by shareholders against a motion after the chair’s asking. However, if there are any objections, the voting method as well as the number of votes in favor and the ratio of votes in favor over total votes cast shall be specified in the meeting minutes. Article 25： These Rules and Procedures shall come into force after their approval at the shareholders’ meeting. The same applies when an amendment is made.

Appendix 2: Articles of Incorporation (Before Amendments)

2017/06/08

104 Corporation

Articles of Incorporation

Chapter 1: General Principles

Article 1 ： The Company is incorporated under the Company Act of the Republic of China and named 104 CORPORATION (English name:104 CORPORATION)
Article 2 ： The lines of business operated by the Company are as follows:
(1) CC01120 Data Storage Media Manufacturing and Duplication
(2) F109070 Wholesale of Stationery Articles, Musical Instruments and Educational Entertainment Articles
(3) F118010 Wholesale of Computer Software
(4) F209060 Retail Sale of Stationery Articles, Musical Instruments and Educational Entertainment Articles
(5) F218010 Retail Sale of Computer Software
(6) F601010 Intellectual Property
(7) I103060 Management Consultancy
(8) I301010 Software Design Services
(9) I301020 Data Processing Services
(10) I301030 Digital Information Supply Services
(11) I401010 General Advertising Services
(12) I701011 Employment Services
(13) IZ12010 Manpower Services
(14) IZ13010 Internet Authentication Services
(15) J303010 Magazine and Periodical Publication
(16) J304010 Book Publishers
(17) JB01010 Conference and Exhibition Services
(18) IZ15010 Marketing Research and Opinion Polling
(19) J202010 Industry Innovation and Incubation Services
(20) ZZ99999 All business items that are not prohibited or restricted by law, except those that are subject to special approval.
Article 3 ： The head office shall be located in New Taipei City. If necessary it may establish branches or offices domestic and/or overseas upon passing relevant resolutions at its board meetings.
Article 4 ： When the Company issues external endorsements and reinvests in other businesses to facilitate its business requirements, it shall not be subject to the restrictions of Article 13 of the Company Act.

Chapter 2: Shares

Article 5 ： The total capital of this bank shall be Five Hundred Million New Taiwan Dollars (NT$500,000,000), divided into Fifty Million (50,000,000) shares at Ten New Taiwan Dollars (NT$10.00) per share, and shall be issued in installments subject to the authorization of the board of directors.
Fifty Million New Taiwan Dollars (NT$50,000,000) of the aforementioned capital is retained and divided into Five Million (5,000,000) shares at Ten New Taiwan Dollars (NT$10.00) per share. The aforementioned capital shall reserve funds for issuing employee stock warrants which shall be issued in installments subject to the resolutions

of the board of directors.

Article 5-1 When the price of issued employee stock warrants is lower than the closing price of the Company common stocks as of the issuing date, an issuer is required to obtain the consent of at least two-thirds of the voting rights represented at a shareholders’ meeting attended by shareholders representing a majority of the total issued shares. To transfer shares to employees at less than the average actual share repurchase price, the Company must have obtained the consent of at least two-thirds of the voting rights present at the most recent shareholders’ meeting attended by shareholders representing a majority of total issued shares.
Article 6 ： All share certificates of the Company shall be registered, signed or sealed and numbered by at least three directors. The share certificates shall be duly certified or authenticated by the competent authority or a certified institution appointed by the competent authority before issuance. The Company issued shares are exempted from printing share certificates, and shall be registered in Taiwan Depository & Clearing Corporation.
Article 7 ： When the Company issues new shares, all the shares to be printed in that issue should be printed together; moreover, issued shares are exempted from printing. The issued shares in the provisions of the preceding article shall be registered with or stored in the Taiwan Depository & Clearing Corporation; they may also be merged or reissued with large denomination securities as per the demand of Taiwan Depository & Clearing Corporation.
Article 8 ： When the Company shareholders process stock-related affairs including share transfers, rights pledges, loss reports, inheritance, gifts, seal loss reports and changes, or address changes, and exercise any or all within their rights, unless otherwise provided by regulations and securities laws, all other related matters shall follow the Regulations Governing the Administration of Shareholder Services of Public Companies.
Article 9 ： Registration for transfer of shares shall be suspended 60 days before the date of a general meeting of shareholders, and 30 days before the date of any extraordinary meeting of shareholders, or within five days before the day on which dividends, bonus, or any other benefit is scheduled to be paid by the Company.

Chapter 3: Shareholders’ Meetings

Article 10 ： Shareholders’ meetings of the Company shall be of two types, regular meetings and extraordinary meetings. 1. Regular meetings shall be convened once a year within six months after the close of each fiscal year, and a notice to convene a regular meeting shall be given to the shareholders within 30 days.
When necessary, extraordinary meetings shall be convened and a notice to convene an extraordinary meeting shall be given to the shareholders within 15 days.

The notice in the preceding paragraph shall specify date, place and agenda of the meeting.

Unless otherwise provided by the Company Act, the shareholders’ meetings are convened by the board of directors.
Article 11 ： When a shareholder is unable to attend a shareholders’ meeting for some reason, he or she may appoint a proxy to attend a shareholders’ meeting on his or her behalf by executing a power of attorney printed by the corporation stating therein the scope of power authorized to the proxy. When a person acts as proxy for two or more shareholders, the number of votes represented by him or her shall not exceed 3% of the total number of voting shares of the Company, otherwise, the portion of excessive voting power shall not be counted.

A shareholder may only execute one power of attorney and appoint one proxy only, and shall serve such written proxy to the company no later than 5 days prior to the date of the shareholders’ meeting.

Unless otherwise regulated by the Company Act, other matters in relation hereto shall follow “Regulations Governing the Use of Proxies for Attendance at Shareholder Meetings of Public Companies”. Article 12 ： Unless otherwise regulated by the Company Act, a shareholders’ meeting shall be presided over by the chairman. In the chairman’s absence, the chairman shall designate one director to act on his or her behalf. In the absence of such designation, the directors shall elect one to act on his or her behalf. The rules of procedures for the Company’s shareholders meetings shall be as provided in the company ethical best practices regulations. Article 13 ： Except for paragraph 2 of Article 179 and paragraph 2 of Article 197-1 of the Company Act where there is no voting power for shares, each shareholder of the Company shall be entitled to one vote for each share he/she holds. Article 14 ： The voting power at a shareholders’ meeting may be exercised in writing or by way of electronic transmission, A shareholder exercising voting power in writing form or by way of electronic transmission shall be deemed to have attended the meeting in person, but to have waived his/her voting power with respect to the extemporary motions and amendments to original proposals of that meeting. Electronic voting shall be conducted in accordance with to Article 177-2 of the Company Act. Article 15 ： Unless otherwise provided by the Company Act, resolutions at a shareholders’ meeting shall be adopted by a majority vote (50%) of the shareholders present, who hold more than 50% of the total number of shares issued and outstanding. Resolutions adopted at a shareholders’ meeting shall be recorded in the minutes of the meeting, which shall be affixed with the signature or seal of the chairman of the meeting and shall be distributed to all shareholders of the company within twenty days after the close of the meeting. The preparation of the minutes of shareholders’ meeting as required in the preceding paragraph may be effected by means of electronic transmission. The distribution of the minutes of shareholders’ meeting as required in the preceding Paragraph may be effected by means of electronic transmission. The minutes of shareholders’ meeting shall record the date and place of the meeting, the name of the chairman, the method of adopting resolutions, and a summary of the essential points of the proceedings and the results of the meeting. The minutes shall be kept persistently throughout the life of the company. The attendance list bearing the signatures of shareholders present at the meeting and the powers of attorney of the proxies shall be kept by the company for a minimum period of at least one year. However, if a lawsuit has been instituted by any shareholder in accordance with the provisions of Article 189 hereof, the minutes of the shareholders’ meeting involved shall be kept by the company until the legal proceedings of the foregoing lawsuit have been concluded.

Chapter 4: Director and Supervisor

Article 16： The Company shall have six directors and two supervisors, to be elected at the shareholders’ meeting.

The number of directors indicated in the preceding paragraph shall include two seats for independent directors which in turn shall be no fewer than one-fifth (1/5) of the total board size.

The directors and supervisors shall be elected in accordance with the candidate

nomination process, meaning shareholders shall elect the directors and supervisors among the nominees list in the roster of director candidates.

The election of the directors shall follow Article 198 of the Company Act. The election of independent and non-independent directors shall be carried out together but their votes calculated separately. Candidates prevailing in the vote count shall be deemed independent directors and directors.

The tenure of office of the directors and the supervisors shall be three years, and they shall be eligible for re-election.

In case no election of new directors and supervisors is effected after expiration of the term of office of existing directors and supervisors, the term of office of out-going directors and supervisors shall be extended until the time new directors and supervisors have been elected and assumed their office.
Article 17 ： The total number of shares held by the directors and supervisors shall follow the “Rules and Review Procedures for Director and Supervisor Share Ownership Ratios at Public Companies” designated by the competent authority.
Article 18 ： To disperse director and supervisor law liability risks and thereby increase the Company’s governance capability, the Company shall take out Directors and Officers Liability Insurance for all directors and supervisors, and for all reinvestment company director and supervisor representatives throughout their term of office.
Article 19 ： The board of directors shall be composed of directors. The chairman of the board of directors shall be elected from among the directors by a majority vote of the directors present at a meeting attended by at least two-thirds (2/3) of the directors. The chairman shall be in charge of the entire Company’s internal business as well as for its external representation.
Article 20 ： The board of directors is convened by the chairman. The meeting shall be presided by the chairman. If he is on leave or if, for any cause, he is unable to perform his duties, the chairman shall designate another director to act on his behalf. Without such a designation, the other directors shall elect one from among themselves to act for the chairman.

The board meeting may be convened by video conference. A director shall be deemed to attend the board meeting in person if he attends the video conference. When a director is unable to attend the meeting for some reason, he or she may appoint another director as a proxy to attend the meeting in his or her behalf by executing a power of attorney.

All board directors and supervisors need to be notified seven days prior to the convening of board meetings. The board must be able to convene at any time in instances of emergencies.

The notice to convene must expressly stipulate the subject of the meeting and be sent out in the form of written notices, emails, or faxes.

Article 21 ： Except as otherwise provided in the Company Act, resolutions at the meetings of the board of directors shall be adopted by a majority vote at a meeting attended by majority of the directors.
Article 22 ： The supervisors may attend the directors’ meetings and express their opinions but shall not vote at these meetings.
Article 23 ： When the Company directors and supervisors execute their duties, regardless of whether the Company business operates at a profit or loss, the Company shall furnish their remuneration. The board is authorized to determine remuneration to directors and supervisors based on their level of participation in the Company operations and their individual contributions, using industry standards as their reference. Such deliberations will refer to industry norms and standards and not exceed standard agreements per Company management regulations for the Company’s highest

positions.

Chapter 5: Manager

Article 24 ： The Company may establish several managers with their appointments authorized by resolutions of the board of directors and decided by the chairman. If a managerial relationship position is appointed, the appointment, dismissal and remuneration shall conform with the Company Act.

Chapter 6: Accounting

Article 25 ： The fiscal year of the Company shall begin on January 1 and end on December 31 of each year. Annual closing of books shall be done at the close of each fiscal year. The board of directors shall then have the following financial statements and other reports prepared in accordance with the Company Act, and shall deliver these to the supervisor for examination 30 days before the date fixed for the regular shareholders’ meeting.
(1) Report on operations;
(2) Financial statements; and
(3) Proposals on distribution of profits or covering of losses.
Article 26 ： At the end of the fiscal year, if the Company operates at a profit (the profit so-called is pre-tax profit before deducting remuneration for distributed employees and directors and supervisors) it shall contribute an employee bonus consisting of 8%-15% of employee salaries and bonuses to directors and supervisors consisting of no more than 3% of their salaries. However, any losses accumulated by the Company to date shall be paid off first.
The employee bonus in the preceding paragraph shall be distributed in the form of shares or in cash and object of payment includes the employees of subsidiaries of the Company meeting certain specific requirements. The directors and supervisors’ remuneration shall be distributed in the form of cash.

The items in the preceding two paragraphs shall be undertaken by resolution of the board of directors and a report shall be submitted to the shareholders’ meeting.

Article 27 ： At the end of each fiscal year, if the Company has net profits they shall first be used to remedy any losses and 10% of net profits will be set aside as a statutory surplus reserve. However, if the accumulation of statutory surplus reserves reaches the total capital volume, then this limitation does not apply.
Whether the rest of the accumulated profit is to be distributed in the form of dividends or retained shall be decided by resolution at the shareholders’ meeting.
Article 28 ： The Company’s dividend policy shall be based on considerations of the Company’s current industry operating environment and growth phase and shall accord with future capital demand and the long term financial planning of the Company, and be allocated on sound principles. Currently our industry is projected to enjoy a growth phase and over the next few years, we anticipate business expansion plans and capital demand. Therefore, as regards the second part of Article 26 vis-a-vis surplus profit available for distribution, dividends shall be distributed in the form of cash or shares. The cash dividend shall not be less than 10% of the total amount of the dividend. The type and ratio of surplus profit distribution shall depend on the real profit and capital condition at the end of each fiscal year and be revised by resolution of the shareholders’ meeting.

Chapter 7: Supplementary Provisions

Article 29 ： The Company Act shall be referred to for matters not covered in these Articles of Incorporation.
Article 30 ： The Articles of Incorporation was first made executed on October 1, 1993 The first amendment was made on July 31, 1998 The second amendment was made on March 14, 2000 The third amendment was made on July 20, 2000 The fourth amendment was made on August 14, 2000 The fifth amendment was made on June 3, 2002 The sixth amendment was made on June 9, 2004 The seventh amendment was made on May 16. 2005 The eighth amendment was made on June 12, 2006 The ninth amendment was made on June 11, 2008 The tenth amendment was made on June 10, 2009 The eleventh amendment was made on June 17, 2010 The twelfth amendment was made on June 15, 2012 The thirteenth amendment was made on June 24, 2015 The fourteenth amendment was made on June 7, 2016 The fifteenth amendment was made on June 8, 2017

Appendix 3: Directors and Supervisors Election Guidelines (Before Amendments)

104 Corporation

Directors and Supervisors Election Guidelines

2017/06/08

Article 1 ： Except as otherwise provided by law and regulation or by the Company’s Articles of Incorporation, elections of directors and supervisors shall be conducted in accordance with the Rules. Article 2 ： More than half of the directors shall be persons who have neither a spousal relationship nor a relationship within the second degree of kinship with any other director. At least one supervisor position must be held by a person having neither a spousal relationship nor a relationship within the second degree of kinship with any other supervisor or with any director. At least one of the supervisors must be domiciled in the Republic of China (Taiwan) to be able to promptly fulfill the functions of supervisor. Article 3 ： The cumulative voting method shall be used for elections of the directors and supervisors at the Company. Attendance card numbers printed on the ballots may be used instead of recording the names of voting shareholders. Each share will have voting rights in numbers equal to the directors or supervisors to be elected, and may be cast for a single candidate or split among multiple candidates. Elections of the independent directors and non-independent directors shall be held together, with voting rights separately calculated for these two positions. Article 4 ： The number of directors and supervisors will be as specified in the Company’s Articles of Incorporation. Those receiving ballots representing the highest numbers of voting rights will sequentially be elected as the directors or supervisors according to their respective numbers of votes. When two or more persons receive the same number of votes, thus exceeding the specified number of positions, they shall draw lots to determine the winner, with the chair drawing lots on behalf of any person not in attendance. For any shareholder who is simultaneously elected as both director and supervisor, in accordance with the preceding paragraph, he/she shall determine whether to assume the position of the director or the supervisor, and the resulting vacancy shall be filled by the candidate who receives the second highest rights of vote originally. Article 5 ： The Company shall comply with the Articles of Incorporation to adopt a candidate nomination system for the election of the directors and supervisors. For the purpose of reviewing the qualifications, academic backgrounds and experiences of director and supervisor candidates and whether they are involved in any of the actions prescribed in Article 30 of the Company Act, the Company may not arbitrarily add the documentary proof of other qualifications. In addition, it shall publicize the results of the review to the shareholders for their reference, enabling them to select the competent directors and supervisors. Article 6 ： When an election begins, the chair shall appoint a number of persons to perform the respective duties of vote monitoring and counting personnel. Article 7 ： The ballots are prepared by the Company with attendance card numbers and corresponding voting rights printed on the them. A voter must enter the candidate’s account name and shareholder account number or ID card number in the “candidate” column of the ballot. However, when the candidate is a juristic person shareholder, the name of the juristic person shareholder shall be

entered in the column for the candidate’s account name in the ballot paper, or both the name of the juristic person shareholder and the name of its representative may be entered.

Article 8 ： A ballot is invalid under any of the following circumstances:
The ballot was not prepared by the Company.
A blank ballot is placed in the ballot box.
The writing is unclear and indecipherable or has been altered.
Other words or marks are entered in addition to the candidate’s account name and shareholder account number or identity card number and the number of voting rights allotted.
The name of the candidate entered in the ballot is identical to that of another shareholder, but no shareholder account number or ID card number is provided in the ballot to identify such individual.
Article 9 ： The voting rights shall be calculated on site immediately after the end of the poll, and the results of the calculation shall be announced by the chair or a delegated master of ceremony on the site.
Article 10 ： The Rules, and any amendments thereto, shall be implemented after being approval at the shareholders’ meeting.

Appendix 4: Procedure for Acquisition and Disposal of Assets (Before Amendments)

104 Corporation Procedure for Acquisition and Disposal of Assets

Article 1 `：` Purpose

The Procedures are enacted especially for guaranteeing investments, implementing information disclosure and strengthening the Company’s management of the acquisition or disposal of assets.

Article 2 `：` Basis

The Procedures are adopted in accordance with Article 36-1 of the Securities and Exchange Act and Article 7 of the “Regulations Governing the Acquisition and Disposal of Assets by Public Companies”.

Article 3 `：` Scale of Assets

The term “assets” as used in the Procedures includes the following:

Investments in stocks, government bonds, corporate bonds, financial bonds, securities representing interest in a fund, depositary receipts, call (put) warrants, beneficial interest securities, and asset-backed securities.
Real property (including land, houses and buildings, investment property, rights to use land, and construction enterprise inventory) and equipment.
Memberships.
Patents, copyrights, trademarks, franchise rights, and other intangible assets.
Claims of financial institutions (including receivables, bills purchased and discounted, loans, and overdue receivables).
Derivatives.
Assets acquired or disposed of in connection with mergers, demergers, acquisitions, or transfer of shares in accordance with law.
Other major assets.

Article 4 `：` Definition of Terms

Derivatives: Forward contracts, options contracts, futures contracts, leverage contracts, swap contracts, and compound contracts combining the above products, whose value is derived from assets, interest rates, foreign exchange rates, indexes, or other interests. The term "forward contracts" does not include insurance contracts, performance contracts, after-sales service contracts, long-term leasing contracts, or long-term purchase (sales) agreements.
Assets acquired or disposed through mergers, demergers, acquisitions, or transfers of shares in accordance with law: Refers to assets acquired or disposed through mergers, demergers, or acquisitions conducted under the Business Mergers and Acquisitions Act, Financial Holding Company Act, Financial Institution Merger Act, and other acts. This could also refer to the transfer of shares from another company through the issuance of new shares of its own as the consideration therefor (hereinafter “transfer of shares”) under Paragraph 8 of Article 156 of the Company Act.
Related party or subsidiary: As defined in the Regulations Governing the Preparation of Financial Reports by Securities Issuers.
Professional appraiser: Refers to a real property appraiser or other person duly authorized by law to engage in the value appraisal of real property or equipment.
Date of occurrence: Refers to the date of contract signing, date of payment, date of consignment trade, date of transfer, dates of boards of director resolutions, or other date that can confirm the counterpart and monetary amount of the transaction, whichever date is earlier. For investments for which approval of the competent authority is required, the earlier of the above date or the date of receipt of approval by the competent authority shall apply.
Mainland China area investment: Refers to investments in the mainland China area approved by, Ministry of Economic Affairs Investment Commission or conducted in accordance with the provisions of the Regulations Governing Permission for Investment or Technical Cooperation in the Mainland Area.

Article 5 `：` Exclusion of Related Parties

Professional appraisers and their officers, certified public accounts, attorneys, and securities underwriters that provide the Company with appraisal reports, certified public accountant’s opinions, attorney’s opinions, or underwriter's opinions shall not be a related party of any party to the transaction.

Article 6 `：` Scale and Limit of Investment

Real property and securities acquired by the Company for non-business use, other than bonds or bills traded under repurchase agreements, negotiable certificates of deposit and other financial instruments, shall be executed in accordance with the Company’s internal control system and the level of authority table. The limits thereof are as below:
The total amount of real property for non-business use shall not exceed 15% of the Company’s net worth for the previous year, audited by a certified public account.
The total amount of securities investment shall not exceed 40% of the Company’s net worth for the previous year, audited by a certified public account.
The limit on investments in individual securities shall not exceed 30% of the Company’s net worth for the previous year, audited by a certified public account.
The transaction amount of acquiring or disposing of memberships or intangible assets shall not exceed 15% of the Company’s net worth for the previous year, audited by a certified public account.

Article 7 `：` Appraisal and Operational Procedures for Assessment of Acquisition or Disposal of Assets

Determination Procedures for trading terms
(1) The means of price determination and supporting reference materials for acquiring or disposing of assets:
- i. Acquisition or disposal of securities
- (i) The price of securities traded in centralized securities exchanges or over-the-counter securities firms shall be decided by the market price of such securities at the time of the transaction.
- (ii) The price of securities not acquired or disposed of in a centralized securities exchange or over-the-counter securities firms shall be decided upon by taking into account the net worth per share, profitability, future development potential and referring to the trading price at the time of the transaction.
- ii. An acquisition or disposal of real property, equipment or memberships, or intangible assets shall be conducted by means of price comparison, price negotiation, invitation to tender, or other methods.
(2) The unit in charge shall abide by the Company’s Approval Authorization Table to conduct an acquisition or disposal of assets, and submit such to the unit in charge for deliberation.
Determination Procedures for authorized limits
(1) Acquisition or disposal of securities
- The Company shall abide by its level of authority Table to conduct an acquisition or disposal of short-term and long-term securities investments. It shall then submit such to the unit in charge for deliberation.
(2) Acquisition or disposal of real property, equipment or memberships, or intangible assets: The unit undertaking the operation shall arrange, according to the Company’s level of authority Table, reasons for the proposed acquisition or disposal, underlying assets, trading counter-party, transfer price, payment/receipt terms, and supporting reference materials for prices. The unit shall then submit such to the unit in charge for deliberation.
Article 8 ： Director or Independent Director’s Dissent with regard to the Acquisition or Disposal of Assets. With respect to the Company’s acquisition or disposal of assets that is subject to the approval of the Board of Directors under the Procedures, if a director expresses dissent and it is contained in the minutes or a written statement, the Company shall submit the director’s dissenting opinion to each supervisor.

Where the position of the independent director has been created in the Company, when a transaction involving the acquisition or disposal of assets is submitted for discussion by the Board of Directors pursuant to the preceding paragraph, the Board of Directors shall take into full consideration each independent director's opinions. If an independent director objects to or

expresses reservations about any matter, this shall be recorded in the minutes of the Board of Directors meeting.

Article 9 ： Appraisal Report for Acquiring or Disposing of Real Property or Equipment In acquiring or disposing of real property or equipment which meets the standard for
announcement and report, and where the transaction amount reaches 20 % of the Company’s paid-in capital or NT$300 million or more, the Company, unless transacting with a government agency, engaging others to build on its own land, engaging others to build on rented land, or acquiring or disposing of equipment for business use, shall obtain an appraisal report prior to the date of occurrence of the event from a professional appraiser and shall further comply with the following provisions:
Where due to special circumstance it is necessary to give a limited price, specific price, or special price as a reference basis for the transaction price, the transaction shall be submitted for approval by the Board of Directors in advance, and the same procedure shall be followed for any future changes to the in case the transaction terms and conditions of the transaction.
Where the transaction amount is over NT $1 billion or more, appraisals from two or more professional appraisers shall be obtained.
Where any one of the following circumstances applies with respect to the professional appraiser's appraisal results, unless all of the appraisal results for the assets to be acquired are higher than the transaction amount, or all the appraisal results for the assets to be disposed of are lower than the transaction amount, a certified public accountant shall be engaged to perform the appraisal in accordance with the provisions of Statement of Auditing Standards No. 20 published by the ROC Accounting Research and Development Foundation (the "ARDF")and render a specific opinion regarding the reason for the discrepancy and the appropriateness of the transaction price:
- (1) The discrepancy between the appraisal result and the transaction amount is 20% or more of the transaction amount.
- (2) The discrepancy between the appraisal results of two or more professional appraisers is 10% or more of the transaction amount.
No more than 3 months may elapse between the date of the appraisal report issued by a professional appraiser and the contract execution date. Where the publicly announced current value for the same period is used and not more than 6 months have elapsed, an opinion may still be issued by the original professional appraiser.
Where the Company acquires or disposes of assets through court auction procedures, the evidentiary documentation issued by the court may be substituted for the appraisal report or CPA's opinion.

Article 10 ： Appraisal report for Acquisition or Disposal of Securities and Memberships or Intangible Assets.

In acquiring or disposing of securities, the Company prior to the date of occurrence of the event, shall obtain the issuing company’s most recent audited or reviewed financial statement by a CPA for reference in appraising the transaction price. In the dollar amount of the transaction is 20% of the Company’s paid-in capital or NT $300 million or more, a CPA shall be engaged to provide an opinion regarding the reasonableness of the transaction price before the date of the occurrence of the event. If an expert’s opinion should be adopted by the CPA, this shall be carried out in accordance with the provisions of Statement of Auditing Standards No. 20 published by the ARDF. However, this requirement does not apply to publicly quoted prices of securities that have an active market, or where otherwise provided by regulations of Financial Supervisory Commission (FSC)
Where the Company acquires or disposes of memberships or intangible assets and the transaction amount reaches 20 % or more of the Company’s paid-in capital or NT$300 million or more, except in transactions with a government agency, the Company shall engage a certified public accountant prior to the date of occurrence of the event to render an opinion on the reasonableness of the transaction price. The CPA shall comply with the provisions of statement of the Auditing Standards No. 20published by the ARD DF.
Where the Company acquires or disposes of assets through court auction procedures, the evidentiary documentation issued by the court may be substituted for the appraisal report or CPA's opinion.

Article 11 ： Related Party transactions

The Company shall conduct the necessary resolution and appraise on the reasonableness of trading terms in accordance with the provisions under Articles 7 to 10 and the Article while acquiring or disposing of assets from or to a related party. Where the transaction amount reaches 10% or more of the Company’s total assets, it shall also obtain the appraisal report from by a professional appraiser or CPA's opinion pursuant to the preceding article. When judging whether a trading counter-party is a related party, in addition to legal formalities, the substance of the relationship shall also be considered.
When the Company intends to acquire real property from a related party, or when it intends to acquire or dispose of assets other than real property from or to a related party and the transaction amount reaches 20 % or more of the Company’s paid-in capital, 10 % or more of total assets, or NT$300 million or more, except in the trading of government bonds, bonds under repurchase and resale agreements, or subscription or redemption of money market funds issued by domestic securities investment trust enterprises, the Company may not proceed to enter into a transaction contract or make a payment until the following matters have been approved by the Board of Directors and recognized by the supervisors:
(1) The purpose, necessity and anticipated benefit of the acquisition or disposal of assets.
(2) The reason for choosing the related party as a trading counterparty.
(3) With respect to the acquisition of real property from a related party, information regarding appraisal of the reasonableness of the preliminary transaction terms in accordance with Paragraph 3, Paragraph 4, Paragraph 5, and Paragraph 6 under the Article.
(4) The date and price at which the related party originally acquired the real property, the original trading counter-party, and that trading counterparty’s relationship to the Company and the related party.
(5) Monthly cash flow forecasts for the year commencing from the anticipated month of signing of the contract, evaluation of the necessity of the transaction, and reasonableness of the funds utilization.
(6) An appraisal report from a professional appraiser or a CPA’s opinion in compliance with the preceding article.
(7) Restrictive covenants and other important stipulations associated with the transaction. Where the position of independent director has been created in the Company, when a matter is submitted for discussion by the Board of Directors pursuant to Paragraph 2, the Board of Directors shall take into full consideration each independent director's opinions. If an independent director objects to or expresses reservations about any matter, this shall be recorded in the minutes of the Board of Directors meeting.
The Company that acquires real property from a related party shall evaluate the reasonableness of the transaction costs by the following means (where land and structures thereupon are combined as a single property purchased in one transaction, the transaction costs for the land and the structures may be separately appraised in accordance with either of the means listed in the preceding paragraph):
(1) Based upon the related party's transaction price plus necessary interest on funding and the costs to be duly born by the buyer. “Necessary interest on funding” is imputed as the weighted average interest rate on borrowing in the year the Company purchases the property. This may not be higher than the maximum non-financial industry lending rate announced by the Ministry of Finance.
(2) Total loan value appraisal from a financial institution where the related party has previously created a mortgage on the property as security for a loan. The actual cumulative amount loaned by the financial institution shall have been 70% or more of the financial institution's appraised loan value of the property and the period of the loan shall have been one year or more. However, this shall not apply where the financial institution is a related party of one of the trading counterparties.
The Company that acquires real property from a related party and appraises the cost of the real property in accordance with Paragraph 3 shall also engage a CPA to check the appraisal and render a specific opinion.

Where the Company acquires real property from a related party and one of the following circumstances exists, the acquisition shall be conducted in accordance with Paragraph 2, and the preceding two paragraphs do not apply:
(1) The related party acquired the real property through inheritance or as a gift.
(2) More than five years will have elapsed from the time the related party signed the contract to obtain the real property and the signing date for the current transaction.
(3) The real property is acquired through the signing of a joint development contract with the related party or through engaging a related party to build real property, either on the Company's own land or on rented land.
When the results of the Company’s appraisal conducted in accordance with Paragraph 3 of the Article are uniformly lower than the transaction price for acquiring real property from the related party, the matter shall be handled in compliance with Paragraph 7. However, where the following circumstances exist, objective evidence has been submitted, and specific opinions on reasonableness have been obtained from a professional real property appraiser and a CPA, this restriction shall not apply:
(1) Where the related party acquired undeveloped land or leased land for development, it may submit proof of compliance with one of the following conditions:
- i. Where undeveloped land is appraised in accordance with the means in the preceding article, and structures according to the related party’s construction cost plus reasonable construction profit are valued in excess of the actual transaction price. The “reasonable construction profit” shall be deemed the average gross operating profit margin of the related party's construction division over the most recent three years or the gross profit margin for the construction industry for the most recent period as announced by the Ministry of Finance, whichever is lower.
- ii. Completed transactions by unrelated parties within the preceding year involving other floors of the same property or neighboring or closely valued parcels of land, where the land area and transaction terms are similar after calculation of reasonable price discrepancies in floor or area land prices in accordance with standard property market practices.
- iii.Completed leasing transactions by unrelated parties for other floors of the same property from within the preceding year, where the transaction terms are similar after calculation of reasonable price discrepancies among floors in accordance with standard property leasing market practices.
(2) Where the Company acquiring real property from a related party provides evidence that the terms of the transaction are similar to the terms of transactions completed for the acquisition of neighboring or closely valued parcels of land of a similar size by unrelated parties within the preceding year.
(3) Completed transactions for neighboring or closely valued parcels of land in (1) and (2), in principle, refers to parcels on the same or an adjacent block and within a distance of no more than 500 meters, or parcels close in publicly announced current value. Transactions for similarly sized parcels, in principle, refers to transactions completed by unrelated parties for parcels with a land area of no less than 50% of the property in the planned transaction. “Within the preceding year” refers to the year preceding the date of occurrence of the acquisition of the real property.
Where the Company acquires real property from a related party and the results of appraisals conducted in accordance with Paragraph 3 of this Article are uniformly lower than the transaction price, the following steps shall be taken:
(1) A special reserve shall be set aside in accordance with Paragraph 1 of Article 41 of the Securities and Exchange Act against the difference between the real property transaction price and the appraised cost, and it may not be distributed or used for capital increase or issuance of bonus shares. Where the Company uses the equity method to account for its investment in another public company, the special reserve called for pursuant to law shall be set aside pro rata in a proportion consistent with the share of the Company's equity stake in the other company.
(2) Supervisors shall comply with Article 218 of the Company Act.
(3) Actions taken pursuant to Subparagraph (1) and (2) shall be reported to a shareholders

  - meeting, and the details of the transaction shall be disclosed in the annual report and any investment prospectus.

(4) The Company that has set aside a special reserve under the preceding provisions may not utilize the special reserve until it has recognized a loss on decline in market value of the assets it purchased at a premium, they have been disposed of, adequate compensation has been made, or the status quo ante has been restored, or there is other evidence confirming that there was nothing unreasonable about the transaction, and the FSC has given its consent.
(5) The Company shall also comply with the preceding four subparagraphs if there is other evidence indicating that the acquisition was not an arm’s length transaction.
With respect to the acquisition or disposal of business-use equipment between the Company and its parent or subsidiaries, the Company shall make arrangements in accordance with the Approval Authorization Table and have the decisions deliberated by the unit in charge. Subsequently the finance unit shall submit the relevant data to be ratified by the next Board of Directors meeting.

Article 11-1: The calculation of the transaction amounts referred to in Article 9, Article 10 and Paragraph 1 of Article 11 shall be made in accordance with Paragraph 2 of Article 14 herein, and “within the preceding year” as used herein refers to the year preceding the date of occurrence of the current transaction. Items for which an appraisal report from a professional appraiser or a CPA’s opinion has been obtained need not be counted toward the transaction amount. The calculation of the transaction amounts referred to in Paragraph 2 of Article 11 shall be made in accordance with Paragraph 2 of Article 4 herein. “Within the preceding year” as used herein refers to the year preceding the date of occurrence of the current transaction. Items that have been approved by the Board of Directors and recognized by the supervisors need not be counted toward the transaction amount.

Article 12 `：` Engaging in Derivatives Trading

Business and hedging strategies

The purpose of engaging in derivatives trading shall be to avert risks, and the products selected for trading shall mainly enable the Company to avert the risk arising from business operations. The Company shall only select banks it has established business relations with to engage in transactions in order to avoid credit risks.

Delineation of duties
(1) Financial personnel
- i. Collection of market information, trend and risk analysis, familiarity with financial products, their applicable laws, and trading techniques. This includes engaging in derivatives trading according to the instruction and authorization by the supervisor in charge to avert the risk of market price volatility.
- ii. Periodic evaluation methods

iii.Periodic public announcement and reporting.

(2) Accountant
i. Providing information on risk-exposed positions.
ii. Bookkeeping and compiling financial statements according to TIFRS.

iii.Measurement, supervision and controlling of transaction risks.

Essentials of performance evaluation
(1)Hedging transactions shall be evaluated once on a biweekly basis, and the evaluation report should be submitted to the General Manager at the Head Office for ratification.
(2)In performance evaluations, a comparison between the current value and preset assessment benchmark shall be made on the date of evaluation to serve as a reference for future decisions.
Limits on transactions and upper limits on losses.
(1)The total contractual amount of transactions involving hedging positions denominated in a foreign currency, including foreign exchange (FX) forwards and other derivatives, shall not exceed the net foreign currency assets or liabilities held by the Company.
(2)With respect to hedging transactions such as FX trading and interest rate swaps, such transactions are made for the purpose of hedging. Thus, there is no upper limit on losses. Where exchange rates pose material adverse effect, the General Manager at the Head

Office shall gather the relevant personnel to discuss the countermeasures. The upper limit on losses from a singular contract involving other derivatives shall not exceed 10% of the transaction amount. Proposals may be dealt with by the Chairman first prior to being submitted to the Board of Directors for ratification when necessary.

Operating procedures:
(1) Confirmation of trading positions.
(2) Analysis and judgment of the relevant trends.
(3) Specific methods for determining hedging:
- i. Underlying assets.
- ii. Trading positions.
- iii.Target price and range.
- iv. Strategies and types of transactions.
(4) Acquisition of approval for transaction
(5) Execution of transaction
- i. Trading counter-party: Limited to domestic and foreign financial institutions. Otherwise, a proposal shall be submitted to the General Manager of the Head Office for approval.
- ii. Dealer: The Company's dealers who are allowed to perform derivatives trading shall be proposed to the General Manager of the Head Office for approval before the dealing commences. Subsequently, a notice stating that personnel other than the aforementioned dealers are not allowed to engage in trading shall be sent to the financial institutions having business relations with the Company.
(6) Confirmation of transaction: After a dealer makes a transaction, dealer shall fill out a transaction document and engage the personnel responsible for verification to confirm whether the trading terms are the same as those in the transaction document, dealer shall then submit such to be reviewed by the General Manager of the Head Office.
(7) Settlement: After a transaction is confirmed, the unit in charge of dispatching funds shall appoint a settlement personnel member to prepare the money and the relevant receipts and conduct the settlement based on the agreed price.
Authorized limit

An authorized limit on the Company’s engagement in hedging trading shall be carried out in accordance with the Company’s level of authority Table.

Accounting treatment method

The accounting treatment of derivatives trading is to recognize and evaluate transactions pursuant to TIFRS.

Internal control
(1) Risk management measurement
- i. Credit risk management: Trading counter-parties shall mainly be banks having business relations with the Company.
- ii. Market risk management: Limited to transactions in a public centralized securities exchange and over-the-counter markets.
- iii.Liquidity risk management: To ensure the liquidity, the Company shall confirm with the personnel in charge of dispatching funds whether the trading limit will cause insufficient liquidity before executing a transaction.
- iv. Cash flow risk management: To ensure that the Company maintains a stable level of operational funds, the Company shall only engage in derivative trading with its own funds, and the trading amount shall take into consideration the demand for funds based on the cash flow forecasts for the next three months.
- v. Operational risk management: The Company is required to comply with the authorized limits and operational procedures in order to avoid operational risks.
- vi. Legal risk management: Any document signed with banks shall be reviewed by legal affairs personnel prior to the official signing to avoid legal risks.
(2) Internal control
- i. Dealers may not serve concurrently in other operations, such as confirmations and settlements.
- ii. Dealers shall hand over trading slips or contracts to personnel in charge of the registry

for recordation.

  - iii.Personnel in charge of registry shall periodically perform reconciliations with or while making registrations for the trading counterparty.

  - iv. Personnel in charge of registry shall establish a log book in which the types and amounts of derivatives trading engaged in, approval dates by the Chairman or the Board of Directors, and the matters required to be carefully evaluated shall be recorded in detail.

  - v. Finance personnel shall be responsible for the measurement, supervision and control of trading risks, and they shall report such to the Board of Directors on a regular basis.

(3) Periodic evaluation
- i. A finance supervisor appointed by the Board of Directors shall pay attention to the supervision and control of risks arising from derivatives trading at all times. The finance supervisor shall also make periodic evaluations on whether the performance of the transaction complies with the existing business strategies and whether the risks undertaken fall within a tolerable scope.
- ii. The finance supervisor shall make periodic evaluations of whether existing risk management procedures are properly and realistically carried out in accordance with the Procedures.
- iii.Hedging transactions carried out based on business needs shall be evaluated every two weeks, and such evaluation reports shall be reported to the senior supervisor authorized by the Board of Directors.
- iv. When an irregularity occurs, the finance supervisor shall adopt necessary countermeasures and report to the Board of Directors instantly. If there are independent directors on the Board, the independent directors shall attend the Board of Director's meeting and give opinions.
- v. When the Company engages in derivatives trading, it shall authorize the relevant personnel to make arrangements pursuant to the provisions of the Procedures and subsequently report such to the next Board of Directors meeting.
Internal audit system
(1) Internal auditors shall, pursuant to the Procedures, understand the suitability of internal control for derivatives trading on a regular basis, audit the trading department’s compliance with the “Procedure for Acquisition and Disposal of Assets”, analyze the trading cycle on a monthly basis, and prepare an audit report. In the event of discoveries of material violations, a written notice shall be submitted to the supervisors.
(2) In accordance with the "Regulations Governing Establishment of Internal Control Systems by public companies the audit report in the preceding paragraph and the correction conditions of irregularities shall be reported to the FSC for recordation.
Article 13 ： Mergers, Demergers, Acquisitions, or Transfers of Shares
The Company that conducts a merger, demerger, acquisition, or transfer of shares, prior to convening the Board of Directors to resolve the matter, shall engage a CPA, attorney, or securities underwriter to give an opinion on the reasonableness of the share exchange ratio, acquisition price, or distribution of cash or other property to shareholders, and submit to the Board of Directors for deliberation and passage. However, the Company may be exempt from obtaining an aforesaid opinion on reasonableness issued by an expert. In the case of a merger by the Company of a subsidiary in the which it directly or indirectly holds 100% of the issued shares or authorized capital, and in the case of a merger between subsidiaries in which the Company holds 100% of percent of the respective subsidiaries’ issued shares or authorized capital.
The Company participating in a merger, demerger, acquisition, or transfer of shares shall prepare a public report to shareholders detailing important contractual content and matters relevant to the merger, demerger, or acquisition prior to the shareholder’s meeting, and include it along with the expert opinion referred to in the preceding subparagraph when sending shareholders notification of the shareholder’s meeting for reference in deciding whether to approve the merger, demerger, or acquisition. Provided Where a provision of another act exempts the Company from convening a shareholder’s meeting to approve the merger, demerger, or acquisition, this restriction shall not apply.

Where the shareholder’s meeting of any one of the companies participating in a merger, demerger, or acquisition fails to convene or pass a resolution due to of a lack of a quorum, insufficient votes, or other legal restriction, or the proposal is rejected by the shareholders meeting, the companies participating in the merger, demerger or acquisition shall immediately publicly explain the reason, the follow-up measures, and the preliminary date of the next shareholder’s meeting.
If the Company intends to participate in a merger, demerger, or acquisition, it shall convene a Board of Directors meeting and shareholder’s meeting on the day of the transaction to resolve matters relevant to the merger, demerger, or acquisition, unless another act provides otherwise or the FSC is notified in advance of extraordinary circumstances and grants consent. A company participating in a transfer of shares shall call a Board of Directors meeting on the day of the transaction, unless another act provides otherwise or the FSC is notified in advance of extraordinary circumstances and grants consent.

When participating in a merger, demerger, acquisition, or transfer of shares, the Company shall prepare a full written record of the following information and retain it for five years for reference:

(1) Basic identification data for personnel: Including the occupational titles, names, and national ID numbers (or passport numbers in the case of foreign nationals) of all persons involved in the planning or implementation of any merger, demerger, acquisition, or transfer of another company's shares prior to disclosure of the information.
(2) Dates of material events: Including the signing of any letter of intent or memorandum of understanding, the hiring of a financial or legal advisor, the execution of a contract, and the convening of a Board of Directors meeting.
(3) Important documents and minutes: Including merger, demerger, acquisition, and share transfer plans; any letter of intent or memorandum of understanding, material contracts, and minutes of the Board of Directors meetings.
- When participating in a merger, demerger, acquisition, or transfer of another company’s shares, the Company shall report such to the parent company as soon as the proposal is adopted by the Board of Directors. The parent company shall, within two days commencing immediately from the date of passage of a resolution by the Board of Directors, report the information set out in the preceding paragraph in the prescribed format and via the Internet-based information system to the FSC for recordation. Where any of the companies participating in a merger, demerger, acquisition, or transfer of another company's shares is neither listed on an exchange nor has its shares traded on an OTC market, the Company shall sign an agreement with such company whereby provisions set out in the above shall be carried out.
Every person participating in or privy to the Company’s plan for merger, demerger, acquisition, or transfer of shares shall issue a written undertaking of confidentiality and may not disclose the content of the plan prior to public disclosure of the information and may not trade, in their own name or under the name of another person, in any stock or other equity security of any company related to the plan for merger, demerger, acquisition, or transfer of shares.
The Company may not arbitrarily alter the share exchange ratio or acquisition price unless under the below-listed circumstances, and shall stipulate the circumstances permitting alteration in the contract for the merger, demerger, acquisition, or transfer of shares:
(1) Cash capital increase, issuance of convertible corporate bonds, issuance of bonus shares, issuance of corporate bonds with warrants, preferred shares with warrants, stock warrants, or other equity based securities.
(2) An action, such as a disposal of major assets, which affects the Company’s financial operations.
(3) An event, such as a major disaster or major change in technology, which affects the Company’s shareholder equity or share price.
(4) An adjustment where any of the companies participating in the merger, demerger, acquisition, or transfer of shares from another company, buys back treasury stocks.
(5) An increase or decrease in the number of entities or companies participating in the merger, demerger, acquisition, or transfer of shares.

(6) Other terms/conditions that the contract stipulates may be altered and that have been publicly disclosed.
The contract for participation by the Company in a merger, demerger, acquisition, or transfer of shares shall record the rights and obligations and it shall also record the following: (1) Handling of breach of contract.
(2) Principles for the handling of equity-type securities previously issued or treasury stocks previously bought back by any company that is extinguished in a merger or that is demerged.
(3) The amount of treasury stocks participating companies are permitted under law to buy back after the record date of calculation of the share exchange ratio, and the principles for handling thereof.
(4) The manner of handling changes in the number of participating entities or companies.
(5) Preliminary progress schedule for plan execution, and anticipated completion date.
(6) Scheduled date for convening the legally mandated shareholder’s meeting if the plan exceeds the deadline without completion, and relevant procedures.
After public disclosure of the information, if the Company participating in the merger, demerger, acquisition, or share transfer intends to further carry out a merger, demerger, acquisition, or share transfer with another company, participating Companies shall carry out anew the procedures or legal actions that had originally been completed toward the merger, demerger, acquisition, or share transfer. An exception to this is that where the number of participating companies is decreased and a participating company’s shareholder’s meeting has adopted a resolution authorizing the Board of Directors to alter the limits of authority, in these case, the Company may be exempted from calling another shareholder’s meeting to resolve on the matter anew.
Where any of the companies participating in a merger, demerger, acquisition, or transfer of shares is not a public company, the Company shall sign an agreement with the non-public company whereby the latter is required to abide by the provisions of Subparagraph 4, Subparagraph 5, and Subparagraph 8 under this Article.

Article 14 ： Procedures for Public Disclosure of Information

Under any of the following circumstances, the Company acquiring or disposing of assets shall publicly announce and report the relevant information on the FSC’s designated website in the appropriate format as prescribed by regulations within 2 days counting inclusively from the date of occurrence of the event:
(1) Acquisition or disposal of real property from or to a related party, or acquisition or disposal of assets other than real property from or to a related party where the transaction amount reaches 20 % or more of the Company’s paid-in capital, 10 % or more of total assets, or NT$300 million or more. This shall not apply to the trading of government bonds, bonds under repurchase and resale agreements, or subscription or redemption of money market funds issued by domestic securities investment trust enterprises.
(2) Merger, demerger, acquisition, or transfer of shares.
(3) Losses from derivatives trading reaching the limits on aggregate losses or losses on individual contracts set out in the Procedures.
(4) Where the type of assets acquired or disposed of is equipment for business use, the trading counter-party is not a related party, and the transaction amount meets any of the following criteria:
- i. For a public company whose paid-in capital less than NT$10 billion, the transaction amount reaches NT$500 million or higher.
- ii. For a public company whose a paid-in capital is NT$10 billion or more, and the transaction amount reaches NT$1 billion or more.
(5) Where land is acquired under an arrangement on engaging others to build on the Company’s own land, engaging others to build on rented land, joint construction and allocation of housing units, joint construction and allocation of ownership percentages, or joint construction and separate sale, and the amount the Company expects to invest in the transaction reaches NT$500 million.
(6) Where an asset transaction other than any of those referred to in the preceding five items, a disposal of receivables by a financial institution, or an investment in the Mainland China

area reaches 20 % or more of paid-in capital or NT$300 million. This shall not apply to the following circumstances:

     - i. Trading of government bonds.

     - ii. Trading of bonds, under repurchase and resale agreements, or subscription or repurchase of money market funds issued by domestic securities investment trust enterprises.

The amount of transactions above shall be calculated as follows:
- (1) The amount of any individual transaction.
- (2) The cumulative transaction amount of acquisitions and disposals of the same type of underlying asset with the same trading counterparty within the preceding year.
- (3) The cumulative transaction amount of real property acquisitions and disposals (cumulative acquisitions and disposals, respectively) within the same development project within the preceding year.
- (4) The cumulative transaction amount of acquisitions and disposals (cumulative acquisitions and disposals, respectively) of the same security within the preceding year.
“Within the preceding year”, as used in the preceding paragraph, refers to the year preceding the date of occurrence of the current transaction. Items duly announced in accordance with the Procedures need not be counted toward the transaction amount.
The Company shall compile monthly reports on the status of derivatives trading engaged in up to the end of the preceding month by itself and any subsidiaries that are not domestic public companies and enter the information in the prescribed format into the information reporting website designated by the FSC by the 10th day of each month.
When the Company at the time of public announcement makes an error or omission in an item required by regulations to be publicly announced and so is required to correct it, all the items shall be again publicly announced and report in their entirety within two days counting inclusively from the date of knowing of such error or mission.
When acquiring or disposing of assets, the Company shall keep all relevant contracts, meeting minutes, log books, appraisal reports and CPA, attorney, and securities underwriter opinions at the Company, where they shall be retained for at least five years, except where another act provides otherwise.
When any of the following circumstances occurs with respect to a transaction that the Company has already publicly announced in accordance with the regulations, a public report of relevant information shall be made on the website designated by the FSC within 2 days counting inclusively from the date of occurrence of the event:
- (1) Change, termination, or rescission of a contract signed in regards to the original transaction.
- (2) The merger, demerger, acquisition, or transfer of shares is not completed by the scheduled date set forth in the contract.
(3) Change to the originally publicly announced and reported information.
Article 15 ： Management of Subsidiaries
Where the Company's subsidiary is a public company, it shall establish the “Procedure for Acquisition and Disposal of Assets”. After the procedure have been approved by its Board of Directors and shareholder’s meeting, they shall be submitted to the Company's Board of Directors for reference. The same applied when the procedure are amended.
Where a subsidiary invested in by the Company is not a domestic public company, and when acquisitions and disposals of assets meet the standards for public announcements and reporting, the Company shall also make an announcement and reporting and send a copy. In accordance with the subsidiary’s standards for public announcements and reporting, “20 percent or more of the Company’s paid-in capital”, as used therein, shall be based on the Company's paid-in capital.
Article 16 ： For the calculation of 10 % of total assets under the Procedures, the total assets stated in the most recent parent company only financial statement or individual financial statement in conformity with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

In the case of the Company whose shares have no par value or a par value other than NT$10 per share, for the threshold of transaction amounts of 20 % of paid-in capital under the procedure

shall be replaced by 10 % of equity attributable to owners of the parent.
Article 17 ： When the relevant personnel violates the Procedures and applicable law, the Company may issue a warning, reprimand, demotion, suspension of duties or make other punishments based on the severity and use, such as internal review items.
Article 18 ： Items not dealt with in the Procedures will be executed in compliance with legal regulations and the Company's relevant articles. If the competent authority amends the originally publicized Order for the Regulations Governing the Acquisition and Disposal of Assets, the Company shall abide by the new order.
Article 19 ： The Procedures, and any amendments thereto, shall be submitted to the supervisors and reported to the Board of Directors for approval prior to implementation. If any director expresses dissent and it is contained in the minutes or a written statement, the Company shall submit the director's dissenting opinion to each supervisor.
Where the position of independent director has been created, if an independent director objects to or expresses reservations about any matter, this shall be recorded in the minutes of the Board of Directors meeting.
Article 20 ： The Procedures were established on June 10, 2003
The first amendment was on June 9, 2004
The second amendment was on June 12, 2006
The third amendment was on June 21, 2007 The fourth amendment was on June 15, 2012 The fifth amendment was on June 19, 2014 The sixth amendment was on June 8, 2017

Appendix 5: Procedure for Loaning of Funds and Making of Endorsements/Guarantees (Before Amendments)

104 Corporation Procedure for Loaning of Funds and Making of Endorsements/Guarantees

Article 1 ： Purpose

The Procedure is formulated in order to enhance management over the Company’s fund loaning and endorsement/guarantee operations.

Article 2 `：` Basis

The Procedures are adopted in accordance with Article 36-1 of the Securities and Exchange Act and the “Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Company” stipulated by Financial Supervisory Commission (FSC.)

Article 3 ： Entities to which the company may loan funds:
Where an inter-company or inter-firm business transaction calls for a loan arrangement; or
Where an inter-company or inter-firm short-term financing facility is necessary. The term “short term” as used in the preceding paragraph means one year, or where the company’s operating cycle exceeds one year, one operating cycle.
Loans may be granted due to short-term financing need only under one of the following circumstances:
(1) A company in which the Company directly and indirectly holds more than 50 percent of the voting shares, short-term financing facility is necessary.
(2) Where the loan is approved by the Board of Directors of the Company Directors.

Article 4 `：` Total Amount of Funds Lending and Limit for Each Recipient

When lending funds to other companies and enterprises with which the Company has business relations:
(1) Total Amount of Funds Lending: the amount lent shall no exceed 20 % of the Company’s net worth audited by an independent certified public accountant or as stated in the Company’s latest financial statements.
(2) Limit for Each Recipient: the amount lent to a single recipient shall no exceed the total transaction amount between the recipient and the Company in the most recent year and shall not exceed 10 % of the parent company’s net worth audited by an independent certified public accountant or as stated in the Company’s latest financial statements. The term “transaction amount” means the buying or selling price, whichever amount is higher.
Where an inter-company or inter-firm short-term financing facility is necessary.
(1) Total Amount of Funds Lending: the amount lent shall no exceed 20 % of the Company’s net worth audited by an independent certified public accountant or as stated in the Company’s latest financial statements.
(2) Limit for Each Recipient: the amount lent to a single recipient shall no exceed the total transaction amount between the recipient and the Company in the most recent year and shall not exceed 10 % of the parent company’s net worth audited by an independent certified public accountant or as stated in the Company’s latest financial statements. Except for the aggregate amount mentioned in preceding 2 Paragraphs, where an intercompany or inter-firm business transaction calls for such lending arrangement; or where an inter-company or inter-firm short-term financing facility is necessary provided that the amount of such financing facility shall not exceed 20 % of the amount of parent company net worth audited by an independent certified public accountant or stated in its latest financial statement.

Article 5 ： Term of Fund Lending and Calculation of Interest

The term of each individual loan or funding offered by the Company shall not exceed one year.
Calculation of Interest: Can be negotiated on a case-by-case basis in either fixed or floating rate, interest shall be calculated on a monthly basis. The interest rate for those prices denominated in New Taiwan Dollar shall not be lower than the sub-market interest rate of

the commercial promissory note on the day plus 1% when the Company grants a comparable period of credit. The prices denominated in US dollars shall not be lower than the TAIFX rate on the date plus 1% when the company grants a comparable period of credit. Those who are denominated in other currencies will be separately negotiated

Article 6 ： When lending funds to others, beside to reach the requirements mentioned in Article 3, the
Finance division shall audit a detailed review procedure and make evaluation result, including:
The necessity of and reasonableness of extending loans to others.
Borrower credit status and risk assessment: financial and operational condition, the recipient ability for repayment of indebtedness and its credit worthiness, profitability, intended usages of funds, the maximum amount that can be loaned, duration of loans and calculation of interest.
Impact on the company's business operations, financial condition, and shareholders' equity.
Whether collateral must be obtained and appraisal of the value thereof.
The above review proposal should be submitted to Board of Directors for approval.
The fund loaning between the Company and its Subsidiary or the Subsidiaries shall be submitted to Board of Directors for approval as preceding paragraph, and may authorize the Chairman to lend in installments or to revolve the credit facility when lending funds to the same party, within a certain amount resolved by the Board of Directors and within one year. The aforesaid “certain amount” means that the authorized amount of the loans extended by the Company or any of its subsidiaries to single entity shall not exceed 5% of the net worth on the most recent financial statements of the parent company.

Where the Company has established the position of independent director, when Loaning Funds to Others for discussion by the Board of Directors under the preceding paragraph, the Board of Directors shall take into full consideration each independent director's opinion; independent directors' opinions specifically expressing assent or dissent and their reasons for dissent shall be included in the minutes of the Board of Directors' meeting.

Article 7 ： Additional Guidelines of Lending Funds to Others

The Company shall use the corporate chop registered with the Ministry of Economic Affairs as the dedicated chop for signing financial contract, the Finance Division shall review the procedure of debt guarantor’s seal and signature.
The Finance Division of the Company shall list out the voucher for obtained collaterals or credit guarantee notes and set up a record book for recording the details of the entity to which the lending of funds is made, amount, date of approval by the Board of Directors, drawdown date, and matters to be carefully evaluated in accordance with the Article 6 after each lending f funds has been made.
The Company shall evaluate the status of its loans of funds and reserve sufficient allowance for bad debts, and shall adequately disclose relevant information in its financial reports and provide certified public accountants with relevant information for implementation of necessary auditing procedures.

Article 8 `：` Guidelines of Funds Lent

After each lending has been made, the Finance Division of the Company shall frequently monitor any changes in the borrowers’ and guarantors’ financial, business and related credit conditions, and any changes in the value of collaterals, and prepare written records of the monitoring results. If there is any significant change, the Finance Division of the Company shall promptly report to the Chairman and related divisions in charge for their timely actions.
When the borrower repays its borrowed amount on or before the due date, the relevant guarantee notes shall not be released or relevant liens shall not be cancelled until the borrower has repaid the full amount of principal together with interests accrued.
If repayment cannot be made on the due date, the Company may take enforcement action against the collaterals or guarantors in accordance of applicable laws for recovery.
If, as a result of a change in circumstances, an entity for which an endorsement/guarantee is made does not meet the requirements of Article 3 or the loan balance exceeds the limit, the Company shall adopt rectification plans and submit the rectification plans to all the supervisors, and shall complete the rectification according to the plan.

Article 9 ： The Company may make endorsements/guarantees for the following companies:
A company with which it does business.
A company in which the Company directly and indirectly holds more than 50% of the voting shares.
A company that directly and indirectly holds more than 50 percent of the voting shares in the Company.
Article 10 ： The term “endorsements/guarantees” as used in these Regulations refers to the following:
Financing endorsements/guarantees, including:
(1) Bill discount financing.
(2) Endorsement or guarantee made to meet the financing needs of another company.
(3) Issuance of a separate negotiable instrument to a non-financial enterprise as security to meet the financing needs of the Company itself.
Customs duty endorsement/guarantee, meaning an endorsement or guarantee for the Company itself or another company with respect to customs duty matters.
Other endorsements/guarantees, meaning endorsements or guarantees beyond the scope of the above two paragraphs.
Any creation by the Company of a pledge or mortgage on its chattel or real property as security for the loans of another company shall also comply with these Procedure.
Article 11 ： The aggregate amount of endorsement/guarantee
The Company’s aggregate endorsement/guarantee amount granted shall not exceed 40% of the net worth on the most current financial statements of the parent company; Where the Company’s amount of endorsement/guarantee for individual entity shall not exceed 10% of the net worth on the most current financial statements of the parent company.
The aggregate amount of endorsement/guarantee by the Company and its subsidiaries shall not exceed 40% of the net worth on the most current financial statements of the parent company; Where aggregate amount of endorsement/guarantee by the Company and its subsidiaries for individual entity shall not exceed 10% of the net worth on the most current financial statements of the parent company.
Where an endorsement/guarantee is made due to needs arising from business dealings, the amount lent to a single recipient shall not exceed the total transaction amount between the recipient and the Company in the most recent year and shall not exceed 10 % of the parent company’s net worth audited by an independent certified public accountant or as stated in the Company’s latest financial statements. The procedure shall not apply to the amount approved by Board of Directors due to special circumstances.
Article 11-1 ： Companies in which the Company holds, directly or indirectly, 90% or more of the voting shares may make endorsements/guarantees for each other, and the amount of endorsements/guarantees may not exceed 10% of the net worth of the parent company.
Article 12 ： Hierarchy of decision-making authority and delegation thereof of endorsements/guarantees
The Divisions shall make Endorsements/Guarantees to satisfy its business requirements only after proposal submitted to and resolved upon by the Board of Directors; but to meet the needs of limitation period, the Company may make an endorsement/guarantee approved by the chairman of the board, where empowered by the Board of Directors to grant endorsements/guarantees within a specific limit, for subsequent submission by the next board of directors' meeting, and submit a record for its endorsement/guarantee activities in detail.
Before making any endorsement/guarantee, a subsidiary in which the Company holds, directly or indirectly, 90% or more of the voting shares shall submit the proposed endorsement/guarantee to the public company’s board of directors for a resolution, provided that this restriction shall not apply to endorsements/guarantees made between companies in which the public company holds, directly or indirectly, 100% of the voting shares.
Where the Company needs to exceed the limits set out in the Article 11 of Operational Procedures for Endorsements/Guarantees to satisfy its business requirements, and where the conditions set out in the Operational Procedures for Endorsements/Guarantees are complied with, it shall obtain approval from the board of directors and half or more of the directors shall act as joint guarantors for any loss that may be caused to the company by the excess

endorsement/guarantee. It shall also amend the Operational Procedures for Endorsements/Guarantees accordingly and submit the same to the shareholders' meeting for ratification after the fact. If the shareholders' meeting does not give consent, the company shall adopt a plan to discharge the amount in excess within a given time limit.

Where the Company has established the position of independent director, when it submits its Operational Procedures for Loaning Funds to Others for discussion by the Board of Directors under the preceding 2 paragraphs, the board of directors shall take into full consideration each independent director's opinion; independent directors' opinions specifically expressing assent or dissent and their reasons for dissent shall be included in the minutes of the board of directors' meeting

Article 13 ： Procedures for handling endorsement/guarantee

Any endorsement/guarantee to be provided by the Company shall be examined, evaluated by the Finance Division to see whether its financial condition meet the procedure and analyze the necessity and rationality of endorsement, evaluate the credit and risks of endorsed parties, and the necessity to acquire collateral and appraisal of collateral. The evaluation result shall be submitted to the Chairperson of the board and to the Board of Directors for approval. A pre-determined limit may be delegated to the Chairperson by the Board of Directors if the endorsement/guarantee does not exceed the limit.
When the Company handles endorsement/guarantee, a memorandum book should be prepared. After the endorsement/guarantee is approved by Board of Directors, except for applying the seal in accordance with the procedure, the following information: the endorsement targets, name(s) of the endorsed company, results of risk assessment, amounts of endorsement, contents of collateral obtained and terms and conditions as well as dates to release endorsement details shall be record.
The Finance Division shall evaluate or record the contingent loss for endorsements/guarantees, and shall adequately disclose information on endorsements/guarantees in its monthly financial reports and provide certified public accountants with relevant information for implementation of necessary audit procedures.
For circumstances in which an entity for which the company makes any endorsement/guarantee is a subsidiary whose net worth is lower than half of its paid-in capital, the rectification plan shall be submitted and notified no less frequently than quarterly to Board of Directors.
Article 14 ： Where as a result of changes of condition the entity for which an endorsement/guarantee is made no longer meets the requirements of these Regulations, or the amount of endorsement/guarantee exceeds the limit, the Finance Division shall adopt rectification plans, which the chairman has approved to discharge the amount in excess within a given time limit, and submit the rectification plans to all the supervisors in Board of Directors, and shall complete the rectification according to the timeframe set out in the plan.
Article 15 ： Safekeeping and Procedures for Chop
The Company shall use the corporate chop registered with the Ministry of Economic Affairs as the dedicated chop for endorsements/guarantees. The chop shall be kept in the custody of a designated person approved by the board of directors and may be used to seal or issue negotiable instruments only in prescribed procedures. Engagement, discharge or modification of chop custodian shall be submitted to the Board for approval, the blank notes shall be kept by the Finance Division.

Article 16 `：` Procedures for Public Disclosure of Information

The Company shall announce and report previous month's loan balance and the balance amount of endorsements/guarantees on the FSC's designated website in the appropriate format by the 10th day of each month.
The company whose loans of funds reach one of the following levels shall announce and report such event on the FSC's designated website in the appropriate format within two days commencing immediately from the date of occurrence. “Date of occurrence” in these Regulations means the date of contract signing, date of payment, dates of boards of directors’ resolutions, or other date that can confirm the counterparty and monetary amount of the transaction, whichever date is earlier:

(1) The aggregate balance of loans to others by the Company and its subsidiaries reaches 20% or more of the parent company's net worth as stated in its latest financial statement.
(2) The balance of loans by the Company and its subsidiaries to a single enterprise reaches 10 percent or more of the parent company's net worth as stated in its latest financial statement.
(3) The amount of new loans of funds by the Company or its subsidiaries reaches NT$10 million or more, and reaches 2 percent or more of the parent company's net worth as stated in its latest financial statement.
The Company whose balance of endorsements/guarantees reaches one of the following levels shall announce and report such event on the FSC's designated website in the appropriate format within two days commencing immediately from the date of occurrence. “Date of occurrence” in these Regulations means the date of contract signing, date of payment, dates of board of director resolutions, or other date that can confirm the counterparty and monetary amount of the transaction, whichever date is earlier:
(1) The aggregate balance of endorsements/guarantees by the Company and its subsidiaries reaches 50% or more of the parent company's net worth as stated in its latest financial statement.
(2) The balance of endorsements/guarantees by the Company and its subsidiaries for a single enterprise reaches 20% or more of the parent company's net worth as stated in its latest financial statement.
(3) The balance of endorsements/guarantees by the Company and its subsidiaries for a single enterprise reaches NT$10 million or more and the aggregate amount of all endorsements/guarantees for, investment of a long-term nature in, and balance of loans to, such enterprise reaches 30% or more of parent company's net worth as stated in its latest financial statement.
(4) The amount of new endorsements/guarantees made by the Company or its subsidiaries reaches NT$30 million or more, and reaches 5% or more of the parent company's net worth as stated in its latest financial statement.

The Company shall announce and report on behalf of any subsidiary thereof that is not a public company of the Republic of China any matters that such subsidiary is required to announce and report pursuant to Paragraph 2-3 and Paragraph 3-4 of the preceding paragraph. Article 17 ： Management of Subsidiaries

The Subsidiary shall announce and report the previous month's loan amount, endorsements/guarantees, counterparty, and the durations by the 5th day of each month. The Company shall submit the status of first 2 quarter’s loan amount and endorsements/guarantees and relevant information to Board of Directors.
Where a subsidiary of a public company, or not a public company but intends to make loans or make endorsements or guarantees for others, the Company shall instruct it to formulate its own “Procedure for Loaning of Funds and Making of Endorsements/Guarantees” to others in compliance with the “Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies,” and it shall comply with the Procedures.

Article 18 ： The internal auditors shall audit the Operational Procedures for Loaning Funds to Others and the implementation thereof no less frequently than quarterly and prepare written records accordingly. They shall promptly notify all the supervisors in writing of any material violation found.

Article 19 ： When the relevant personnel violates the Procedures and applicable law, the Company may issue a warning, reprimand, demotion, suspension of duties or make other punishments based on the severity and use, such as internal review items.
Article 20 ： Items not dealt with in the Procedures will be executed in compliance with legal regulations and the Company's relevant articles. If the competent authority amends the originally publicized Order for the Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees, the Company shall abide by the new order.
Article 21 ： The Company shall formulate its Operational Procedures for Endorsements/Guarantees in compliance with these Regulations, and, after passage by the Board of Directors, submit the same to each supervisor and for approval by the shareholders' meeting. Where there any director expresses dissent and it is contained in the minutes or a written statement, the company shall

submit the dissenting opinions to each supervisor and for discussion by the shareholders' meeting. The same shall apply to any amendments to the Procedures.

Article 22 ： The Procedures were established on June 10,2003
The first amendment was on June 9, 2004

The second amendment was on June 12, 2006 The third amendment was on June 21, 2007 The fourth amendment was on June 11, 2008 The fifth amendment was on June 10, 2009 The sixth amendment was on June 17, 2010 The seventh amendment was on June 9, 2011 The eighth amendment was on June 15, 2012 The ninth amendment was on June 28, 2013

Appendix 6: Shareholdings of Directors and Supervisors

104 Corporation

Shareholdings of Directors and Supervisors

Minimum shares required to be held by the entirety of the directors: 3,600,000 shares Minimum shares required to be held by the entirety of the supervisors: 360,000 shares

				March 31, 2019	March 31, 2019
Job Title	Name	Date of election	Term of office	Shares held as registered in the shareholder’s roster during the book closure period
				Number of Shares	Percentage
Chairman	Rocky Yang	May 30, 2018	3 Year	4,495,402	13.54%
Director	Steven Su	May 30, 2018	3 Year	247,896	0.75%
Director	Simon Juan	May 30, 2018	3 Year	132,240	0.40%
Director	Mark Chang	May 30, 2018	3 Year	0	0.00%
Independent Director	Chin-Li Lin	May 30, 2018	3 Year	0	0.00%
Independent Director	Sean Lien	May 30, 2018	3 Year	0	0.00%
Total of all directors				4,875,538	14.69%
Supervisor	Askforce Corporation: Representative`：` Mei-Fang Hsu	May 30, 2018	3 Year	2,427,344	7.31%
Supervisor	Zan-Syong Cai	May 30, 2018	3 Year	0	0.00%
Total of all supervisors				2, 427,344	7.31%

Note: As of March 31, 2019, the Company has issued 33,191,700 shares.

AI assistant

104 — AGM Information 2019

52296_rns_2019-06-12_1942c4b4-9a5a-4924-9358-e03a92a6f35b.pdf

104 Corporation Table of Contents

Meeting Procedure

104 Corporation

2019 Annual Shareholders’ Meeting Procedure

Meeting Agenda

104 Corporation

2019 Annual Shareholders ’ Meeting Agenda

Place ： 104 Corporation Headquarters

I. Matters for Report

2. Supervisor’s Review Report on the 2018 Financial Statements.

II. Matters for Ratification

III. Matters for Discussion

IV. Extemporary Motions

V. Adjournment

Attachment

104 Corporation Business Report

I. 2018 Business Report

(1) Career Mission

(2) Elderly Mission

(3) Children Mission

2. Financial Performance

3. Research and Development Results

II. The Company’s Development Strategies and Future Prospects

1. The Company’s Development Strategies

2. Future Prospects

104 Corporation Supervisor’s Review Report

Independent Auditors’ Report

Opinion

Basis for Opinion

Key Audit Matters

Revenue recognition

Description of key audit matter:

Responsibilities of Management and Those Charged with Governance for the Financial Statements

Auditors’ Responsibilities for the Audit of the Financial Statements

KPMG

Note to Readers

Balance Sheets

December 31, 2018 and 2017

(English Translation of Financial Statements and Report Originally Issued in Chinese) 104 CORPORATION

Statements of Comprehensive Income

For the years ended December 31, 2018 and 2017

(Expressed in Thousands of New Taiwan Dollars, Except for Earnings Per Common Share)

(English Translation of Financial Statements and Report Originally Issued in Chinese) 104 CORPORATION

Statements of Changes in Equity

For the years ended December 31, 2018 and 2017

(Expressed in Thousands of New Taiwan Dollars)

(English Translation of Financial Statements and Report Originally Issued in Chinese) 104 CORPORATION

Statements of Cash Flows

For the years ended December 31, 2018 and 2017

(Expressed in Thousands of New Taiwan Dollars)

Independent Auditors' Report

Opinion

Basis for Opinion

Key Audit Matters

Revenue recognition

Other Matter

Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements

Auditors' Responsibilities for the Audit of the Consolidated Financial Statements

KPMG

Note to Readers

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) 104 CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets

December 31, 2018 and 2017

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) 104 CORPORATION AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

For the years ended December 31, 2018 and 2017

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) 104 CORPORATION AND SUBSIDIARIES

Consolidated Statements of Changes in Equity

For the years ended December 31, 2018 and 2017

(Expressed in Thousands of New Taiwan Dollars)

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) 104 CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the years ended December 31, 2018 and 2017

(Expressed in Thousands of New Taiwan Dollars)

104 Corporation Earnings Distribution Proposal

104 Corporation

Amended Articles

104 AGM Information 2019

Place `：` 104 Corporation Headquarters

Article 1 `：` Purpose

Article 2 `：` Basis

Article 3 `：` Scale of Assets

Article 4 `：` Definition of Terms

Article 5 `：` Exclusion of Related Parties

Article 6 `：` Scale and Limit of Investment

Article 7 `：` Appraisal and Operational Procedures for Assessment of Acquisition or Disposal of Assets

Article 12 `：` Engaging in Derivatives Trading

Article 2 `：` Basis

Article 4 `：` Total Amount of Funds Lending and Limit for Each Recipient

Article 8 `：` Guidelines of Funds Lent

Article 16 `：` Procedures for Public Disclosure of Information