Acer Incorporated Agenda of 2014 General Shareholders’ Meeting

Held on June 18, 2014 www.acer-group.com

Place of the Meeting: 145, Section 3, Jen Ai Rd., Taipei (Taipei Air Force Activity Center)

Disclaimer

This is a translation of the 2014 General Shareholders’ Meeting Agenda of Acer Incorporated (the “Company”). The translation is intended for reference only and nothing else, the Company hereby disclaims any and all liabilities whatsoever for the translation. The Chinese text of the Agenda shall govern any and all matters related to the interpretation of the subject matter stated herein.

ACER INCORPORATED (THE "COMPANY") Regulations for the Conduct of Shareholders’ Meetings

These Regulations shall govern the conduct of Shareholders’ Meetings of the Company.
Shareholders in attendance, or their proxies, shall sign for their attendance on an attendance card. The number of shares in attendance shall be counted according to the number of shares represented by those attendance cards so submitted.
Attendance and votes of Shareholders’ Meetings shall be counted based upon the number of shares in attendance. The present shares shall be calculated in accordance with the attendance book or the attendance cards as submitted, plus the shares exercising voting right by the way of electronic transmission.
The location of Shareholders’ Meetings shall be either where the Company is located, or any other place deemed convenient for the shareholders to attend and proper for holding such meeting. The Shareholders’ Meetings shall be held no earlier than 9 a.m. and no later than 3 p.m. on the designated meeting date.
The Board of Directors shall call the Shareholders’ Meetings. The chairman of the Board of Directors shall preside over the meeting. If the chairman of the Board of Directors is not available for the meeting then the vice-chairman of the Board of Directors shall act on his/her behalf to preside over the meeting. If neither the chairman nor the vice-chairman of the Board of Directors is available for the meeting, the chairman shall designate a director of the Board of Directors to act on his/her behalf to preside over the meeting. The Board of Directors shall elect a director to act on the chairman’s behalf if the chairman appoints no designee. Other than the Board of Directors, a person entitled by law to call a Shareholders’ Meeting shall preside over the meeting, if and when such meeting is called.
The Company may designate legal attorneys, certified-public-accountants, and management officers to attend the meetings.
The Shareholders’ Meetings shall be recorded in their entirety by video or audio recording equipment, and such records shall be kept on file for one year following each of the meeting respectively.
The person who presides over the meeting shall call the meeting in session upon the designated time of the meeting. However, such person may announce postponement of the meeting if at the designated time shares in attendance fail to exceed half of the issued and outstanding shares of the Company. Postponement in a meeting shall be announced no more than two times with the total time up to one hour. If, after the second postponement in the meeting, shares in attendance are less than a quorum but more than one-thirds of the issued and outstanding shares, the shareholders may still proceed such meeting in accordance with Article 175 of the Company Law to adopt provisional resolutions. Before the meeting is adjourned, if shares in attendance have reached a required quorum, the person presiding over the meeting may, in accordance with Article 174 of the applicable Company Law, submit those provisional resolutions so adopted for a final resolution at the meeting.
If Shareholders’ Meeting is called by the Board of Directors, the Board of Directors shall set the agenda of the meeting. The meeting shall proceed in compliance with the agenda so set by the Board of Directors unless otherwise changed by resolution adopted by the meeting. During the meeting, the person presiding over the meeting may allocate an appropriate amount of time for recess. Unless otherwise adopted by a resolution, the person presiding over the meeting may not adjourn the meeting prior to the end of the proceedings (special proposal included) of the meeting. If the chairman declares the adjournment of the meeting in a manner in violation of such rules governing the proceedings of meetings, a new chairman of the meeting may be elected by a resolution to be adopted by a majority of the voting rights represented by the shareholders attending the said meeting to continue the proceedings of the meeting.
A shareholder in attendance who wishes to make an oral statement at the meeting shall first submit an oral statement form, in stating the main purpose of his/her statement, his/her name and shareholder’s account number, and the person to preside over the meeting shall determine the order of such oral statements to be made. Shareholder in attendance submitting an oral statement form but without making an actual oral statement shall be deemed as making no any oral statement. In the event of any conflict between the contents of the oral statement form and the actual oral statement, the actual oral statement shall prevail. Any other the shareholders shall not interfere in any way when a shareholder is making his/her oral statement. The person presiding over the meeting shall stop any such interference.

Unless otherwise approved by the person presiding over the meeting, each shareholder may make oral statements only twice for a same proposal or matter under deliberation; and each oral statement shall not exceed 5 minutes. Otherwise, the person presiding over the meeting may stop the shareholder from making further statements.
A legal entity acting as a proxy for a shareholder to attend the meeting may appoint only one representative to attend the meeting. If more than one representative is appointed to attend the meeting, only one person elected among them can make oral statements on each proposal respectively.
The person presiding over the meeting may reply to the oral statements, or may designate appropriate person to reply to the oral statements made by shareholders in attendance.
The person presiding over the meeting may announce conclusion of discussion of a proposal as he/she may deem appropriate and may submit the proposal for adopting a resolution.
The person presiding over the meeting shall appoint persons among the shareholders in attendance to audit the voting process. The person presiding over the meeting shall also appoint persons to count the votes. The result of the vote shall be announced immediately, and a record of the same shall be made accordingly.
Unless otherwise provided in the Company Law or the Company’s Articles of Incorporation, a proposal may be adopted as a resolution by a majority of the shares in attendance voting in favor thereof. A resolution shall be deemed adopted if no opposition is raised when the person presiding over the meeting makes an oral inquiry to the shareholders concerning the acceptance of the same, and such resolution shall have the same effect as a vote by ballot.
The person presiding over the meeting shall determine the order of voting on amendment proposals or substituted proposals accompanying with their original proposals. As soon as one of those proposals is adopted as a resolution, other proposals in conflict regarding the same matter shall be deemed denied and shall require no further vote.
The person presiding over the meeting may direct monitors (or security guards) to maintain order at the meeting. Monitors (or security guards) shall wear a badge marked “SECURITY” or “MONITOR” when performing their duties at the meetings.
In the event of force majeure, the person presiding over the meeting may suspend a meeting and may announce at a later time when the meeting shall be resumed as he/she deems appropriate; or the shareholders shall make a resolution at the meeting to resume the meeting within 5 days without the need to make any further written notices or published announcements to shareholders.
The applicable Company Law, its relevant regulations, and the Company’s Articles of Incorporation shall govern any matter not provided herein.
These Regulations, and any amendments thereto, shall become effective upon approval by the shareholders.
Approved by the General Shareholders’ Meeting held on May 15, 1990. First Amendment approved by the General Shareholders’ Meeting held on April 26, 1996. Second Amendment approved by the General Shareholders’ Meeting held on May 29, 1998. Third Amendment approved by the General Shareholders’ Meeting held on June 11, 2003. Fourth Amendment approved by the General Shareholders’ Meeting held on June 15, 2012.

INDEX

*NDEX*
A. Meeting Procedure	05
B. Meeting Agenda	06
1. Report Items	07
2. Proposed Resolutions (A)	08
3. Directors Election	09
4. Proposed Resolutions (B)	10
5. Extemporary Motion	16
C. Attachment	17
1. Business Report to Shareholders	17
2. Financial Statements for Year 2013	18
3. Comparison Table of Acer's Regulations Governing Procedure for Board of Directors Meetings	32
4. Comparison Table of Acer's Election Regulation of Directors and Supervisors	34
5. List of Director and Independent Director Candidates	36
6. Comparison Table of Acer's Articles of Incorporation	39
7. Comparison Table of Acer's Procedures of Acquiring or Disposing of Assets	40
8. Comparison Table of Acer's Foreign Exchange Risk Management Policy and Guidelines	48
9. Comparison Table of Acer's Procedures Governing Lending of Capital to Others	50
10. Comparison Table of Acer's Procedures Governing Endorsement and Guarantee	52
D. Appendix	55
1. Regulations Governing Procedure for Board of Directors Meetings	55
2. The Election Regulation of Directors and Supervisors (Before Amendments)	60
3. Articles of Incorporation of Acer Incorporated (Before Amendments)	62
4. Procedures for Acquiring or Disposing of Assets (Before Amendments)	67
5. Foreign Exchange Risk Management Policy and Guidelines (Before Amendments)	78
6. Procedures Governing Lending of Capital to Others (Before Amendments)	80
7. Procedures Governing Endorsement and Guarantee (Before Amendments)	84
8. Shares Held by Directors and Supervisors	88

A. Meeting Procedure

Call the Meeting to Order
Report Items
Proposed Resolutions (A)
Directors Election
Proposed Resolutions (B)
Extemporary Motion
Meeting Adjourned

B. Meeting Agenda

Time: 9:00 a.m., Wednesday, June 18, 2014

Place: 145, Section 3, Jen Ai Rd., Taipei (Taipei Air Force Activity Center)

1. Report Items

(1)To Report the Business of 2013

(2)To Report the Amendments to Regulations Governing Procedure for Board of Directors Meetings

(3)To Report the Impairment of Non-Financial Assets

(4)Supervisors’ Review Report

2. Proposed Resolutions (A)

(1)To Approve the Amendments to the Company’s “The Election Regulation of Directors and Supervisors”

3. Directors Election

To Elect All Directors (including Independent Directors) of the Company

4. Proposed Resolutions (B)

(2)To Accept 2013 Financial Statements and Business Report

(3)To Approve the Statement of Deficit Compensated for 2013

(4)To Approve Amendments to the Company’s Articles of Incorporation

(5)To Approve Amendments to the Company’s Following Internal Rules:
i. Procedures of Acquiring or Disposing of Assets
ii. Foreign Exchange Risk Management Policy and Guidelines

iii. Procedure Governing Lending of Capital to Others

iv. Procedures Governing Endorsement and Guarantee

(6)To Approve the Issuance of Restricted Stock Awards (“RSA”) to Key Employees

(7)To Release the Restrictions on Competitive Activities of Newly-Elected Directors and their Representatives

5. Extemporary Motion

6. Meeting Adjourned

1. Report Items

(1) To Report the Business of 2013 (Please refer to page 17 )

(2) To Report the Amendments to Regulations Governing Procedure for Board of Directors Meetings

In consideration of the establishment of the Company’s Audit Committee which will take the place of the Company’s existing Supervisor function, the Company’s “Regulations Governing Procedure for Board of Directors Meetings” were amended and approved by the BOD meeting on March 27, 2014 as Attachment 3. (Please refer to pages 32 to 33)

(3) To Report the Impairment of Non-Financial Assets
I. According to FSC’s (Financial Supervisory Commission) Order No. Financial-Supervisory-Securities-0940001669 and “Regulations Governing the Preparation of Financial Reports by Securities Issuers”, the Company must do the assets impairment test in accordance with No. 36 of International Accounting Standards (“IAS”).
II. Subject to IAS No. 36, the result of Assets Impairment test is summarized as follows:
- The impairment loss (the excess of the asset’s carrying amount over its recoverable amount) for intangible asset-Goodwill, trademark and Customer Relationship owned by Acer Incorporated and its subsidiaries amounted to NT$ 9,943M for the third quarter ended 30 September 2013.
(4) Supervisors’ Review Report
I. For the Consolidated Financial Report
To: The 2014 General Shareholders’ Meeting

The Board of Directors of the Company has prepared the 2013 consolidated financial report, including consolidated balance sheets, statements of comprehensive income, statements of changes in equity, and statements of cash flows. Huei-Chen Chang and Wei-Ming Shih, Certified Public Accountants of KPMG, have been retained by the Board of Directors of the Company to issue an audit report. The undersigned supervisors have reviewed the audit report and the aforesaid documents, which were made by the Board of Directors in compliance with Article 228 of the Company Law, and did not find any incompliance. In accordance with Article 219 of the Company Law, it is hereby submitted for your review and perusal.

Supervisor: George Huang

Supervisor: Carolyn Yeh

Dated: March 27, 2014

II. For the Non-Consolidated Financial Report

To: The 2014 General Shareholders’ Meeting

The Board of Directors of the Company has prepared the 2013 non-consolidated financial report, including non-consolidated balance sheets, statements of comprehensive income, statements of changes in equity, and statements of cash flows. Huei-Chen Chang and Wei-Ming Shih, Certified Public Accountants of KPMG, have been retained by the Board of Directors of the Company to issue an audit report. The undersigned supervisors have reviewed the audit report and the aforesaid documents, which were made by the Board of Directors in compliance with Article 228 of the Company Law, and did not find any incompliance. In accordance with Article 219 of the Company Law, it is hereby submitted for your review and perusal.

Supervisor: George Huang

Supervisor: Carolyn Yeh

Dated: March 27, 2014

2. Proposed Resolutions (A)

ITEM 1

Proposal: To Approve the Amendments to the Company’s “The Election Regulation of Directors and Supervisors” (Proposed by the Board of Directors)

Explanatory Notes:

(1)To strengthen corporate governance, comply with the Company Act and Securities and Exchange Act, and coordinate with the Audit Committee system and candidate nomination system for election of the directors (including independent directors) newly adopted by the Company’s Articles of Incorporation and relevant rules, it is proposed to amend the Company’s “The Election Regulation of Directors and Supervisors” as Attachment 4. (Please refer to pages 34 to 35)
(2) Please discuss .

Resolution:

3. Directors Election

Proposal: To Elect All Directors (including Independent Directors) of the Company (Proposed by the Board of Directors)

Explanatory Notes:

(1) The tenure of the Company’s directors (including independent directors) is being expired on June 2014 and the directors election is scheduled at 2014 General Shareholders' Meeting.
(2) To implement corporate governance, the Company has established the Audit Committee pursuant to Securities and Exchange Act and the Company Act. Further, according to the Company’s Articles of Incorporation, the board of directors resolves that the nine seats of directors (including three seats of independent directors) are to be elected for the new board.
(3) Nine Directors (including six directors and three independent directors) will be elected at 2014 General Shareholders’ Meeting; the tenure of newly elected directors shall commence on June 18, 2014 and expire on June 17, 2017, for three-year term and eligible for re-election. The Audit Committee will be constituted by all the independent directors.
(4) The candidate lists of Director and Independent Director were approved by the Board of Director on May 8, 2014 as Attachment 5. (Please refer to pages 36 to 38)

Voting Result:

4. Proposed Resolutions (B)

ITEM 2

Proposal:To Accept 2013 Financial Statements and Business Report (Proposed by the Board of Directors)

Explanatory Notes:

(1) The 2012 Financial Statements of Acer Incorporated (including the Balance Sheets, Statements of Comprehensive Income, Statements of Changes in Equity and Statements of Cash Flow) have been approved by the Board of Directors and reviewed by the supervisors, and hereby are submitted for acceptance. (Please refer to pages 17 to 31)
(2) Please discuss.

Resolution:

ITEM 3

Proposal: To Approve the Statement of Deficit Compensated for 2013 (Proposed by the Board of Directors)

Explanatory Notes:

(1) The beginning balance of the un-appropriated retained earnings of the Company in 2013 is NT$0. After deduct the net adjusted amount of IFRS conversion, the opening balance of 2013 after IFRS conversion becomes NT$(4,110,875,348). After plus the reversal of Special Reserve booked in IFRS opening of NT$2,666,131,469, the actuarial gain of defined benefit pension plan of NT$165,509,856, and the net loss after tax for 2013 of NT$20,519,428,168, the deficit to be compensated is NT$21,798,662,191. It is proposed to compensate the deficit by special reserve of NT$3,460,642,125, legal reserve of NT$10,012,168,695, and capital reserve of NT$8,325,851,371. After the appropriation, the ending balance of the un-appropriated retained earnings is NT$0, and the remaining balance of capital surplus is NT$35,381,875,824.
(2) It is proposed not to distribute dividend for 2013.
(3) The Statement of Deficit Compensated for 2013 is shown as follows:
(4) Please discuss.

Acer Incorporated 2013 Statement of Deficit Compensated

Beginning Balance of Un-appropriated Retained Earnings Deduct: Net Adjusted Amount of IFRS Conversion Opening Balance of 2013, after IFRS Conversion Plus : Reversal of Special Reserve in IFRS Opening Actuarial gain for the defined benefit pension plan Deduct: Net Loss after Tax for 2013 Deficit to be compensated Compensation Items: Special Reserve Legal Reserve Capital Surplus Ending Balance of Un-appropriated Retained Earnings Resolution:	Unit: NT$ 0 (4,110,875,348)
	(4,110,875,348) 2,666,131,469 165,509,856 (20,519,428,168)
	(21,798,662,191) 3,460,642,125 10,012,168,695 8,325,851,371
	0

ITEM 4

Proposal: To Approve Amendments to the Company's Articles of Incorporation (Proposed by the Board of Directors)

Explanatory Notes:

(1) Acer’s current authorized capital as specified in the Articles of Incorporation is NT$35 billion, an amount of NT$ 2.5 billion from the aforesaid total capital stock is reserved for exercising stock options. As of the date of this Meeting, the paid-in capital after stock cancellation of the First Buyback in Year 2011 from the date of May 26, 2014 is NT$28,061,078,280. To facilitate future operational requirements, it is proposed to appropriately increase the authorized capital to NT$40 billion.
(2) To facilitate Acer Audit Committee setting and practical requirements, it’s proposed to modify the number of directors (including independent directors) from Nine (9) ~ eleven (11) to seven (7) ~eleven (11).
(3) Therefore, it’s proposed amending Article 6, 12 and 22 of Acer’s Article of Incorporation; for details on the proposed revisions, please refer to Attachment 6 “Comparison Table of Acer’s Articles of Incorporation Before and After Revision.” (Please refer to page 39)
(4) Please discuss.

Resolution:

ITEM 5

Proposal: To Approve Amendments to the Company’s Following Internal Rules:

i. Procedures of Acquiring or Disposing of Assets
ii. Foreign Exchange Risk Management Policy and Guidelines
iii. Procedure Governing Lending of Capital to Others
iv. Procedures Governing Endorsement and Guarantee
(Proposed by the Board of Directors)

Explanatory Notes:

(1) To comply with the FSC amendments to “Regulations Governing the Acquisition and Disposal of Assets by Public Companies” and “Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies” and consider the Company’s establishment of Audit Committee based on the Company Act, Securities and Exchange Act, and the Company’s Articles of Incorporation, it is proposed to amend the following internal rules:
i. Procedures of Acquiring or Disposing of Assets;
ii. Foreign Exchange Risk Management Policy and Guidelines;
iii. Procedures Governing Lending of Capital to Others; and
iv. Procedures Governing Endorsement and Guarantee;

for details please see the comparison table of the aforesaid internal rules before and after revisions as Attachment 7 to 10. (Please refer to pages 40 to 54)

(2) Please discuss.

Resolution:

ITEM 6

Proposal: To Approve the Issuance of Restricted Stock Awards (“RSA”) to Key Employees (Proposed by the Board of Directors)

Explanatory Notes:

(1) In order to award outstanding employees and retain their talents, it is proposed to issue Restricted Stock Awards to eligible employees pursuant to Article 267 of the Company Act and the “Regulations Governing the Offering and Issuance of Securities by Securities Issuers” promulgated by the FSC.
(2) The issuance of RSA may be reported in one tranche or in installments to the competent authority for registration within one year after the resolution of the General Shareholders’ Meeting. In accordance with the actual needs, the Chairman of the Board shall set up the actual issue date(s) in one tranche or in installments within one year following the date of receipt of effective registration from the competent authority.
(3) The following matters are included for the issuance of RSA:
i. Issuance amount: not exceed 50,000 thousand shares.(Note)
ii. Issuance terms and conditions:
- (i). Issuance price: granted to employees for free or by subscription at NT$10 per share tentatively. Upon the approval at the General Shareholders’ Meeting, it is proposed that the Board of Directors is to be authorized to resolve the actual issue price on the issue date.
- (ii). Vesting condition: qualified with both of the time-based and performance-based requirements set by the issuance rules of the RSA.
- (iii). Type of shares: common share of the Company.
- (iv). Handling of the shares that employees obtain by inheritance or fail to meet the vesting condition: the Company shall redeem or buy back at issuance price and then cancel all of those RSA that fail to meet the vesting condition.
iii. Qualification for employees and stocks awarded
- (i). Qualification for employees: For those employees who are full-time and outstanding as of the issue date. The actual number of qualified employees shall be determined by seniority, position, performance, overall contribution and any other factors, with consideration given to the Company’s operational needs and business development strategy, pursuant to the issuance rules of the RSA set by the Company within the extent permitted by laws and regulations.
- (ii). Stocks awarded: number of restricted stocks plus number of employee stock options issued under Paragraph 1 of Article 56-1 of “Regulations Governing the Offering and Issuance of Securities by Securities Issuers” awarded to each employee shall not exceed 0.3% of the total number of the Company’s issued shares on the ended date of a year. Moreover, number of restricted stocks plus number of employee stock options issued under Paragraph 1 of Article 56 of “Regulations Governing the Offering and Issuance of Securities by Securities Issuers” awarded to each employee shall not exceed 1% of the total number of the Company’s issued shares on the ended date of a year.
iv. The reasons necessitating the issuance of RSA: to attract and retain talents, enhance employees’ cohesion and sense of belonging to the Company, increase competitiveness, and foster the best interests of the Company and its shareholders.
v. The estimated expense amount, dilution of the Company’s earning per shares (EPS) and other impacts on shareholders’ equity: the total number of the RSA issued shall not exceed 50,000 thousand shares. Based on the closing price of NT$18 on March 5, 2014 for the common shares of the Company, with assumption of the shares subscripted fully at NT$10 per share, in consideration of employees’ vesting period, stock price volatility and risk-free interest rate, etc., and then plugging into option pricing model, the yearly amortization of the expense amount for 2014, 2015, 2016, 2017 and 2018 is estimated to be NT$97.26M, NT$97.26M, NT$97.26M, NT$97.26M and NT$97.26M respectively, the dilution of the Company’s EPS is approximately NT$0.035, NT$0.035, NT$0.035, NT$0.035 and NT$0.035 respectively. If the RSA are granted for free, the yearly amortization of the expense amount for 2014, 2015, 2016, 2017 and 2018 is estimated to be NT$180M, NT$180M, NT$180M, NT$ 180M

and NT$180M respectively, the dilution of the Company’s EPS is approximately NT$0.065, NT$0.065 , NT$0.065, NT$0.065 and NT$0.065 respectively. There is a limited dilution of the Company’s future EPS, and there is no material impact on existing shareholders’ equity.

vi. If some revision or adjustment has to be made due to the competent authority’s instruction, amendment to the laws and regulations, financial market conditions or other objective circumstances, it is proposed that the General Shareholders’ Meeting authorizes the Board of Directors with full power and authority to handle all the issues regarding the issuance of RSA.
vii. The RSA issued may be held in a security trust account.
viii. With respect to the issuance of RSA, the relevant restrictions, important agreements and any other matters not set forth here shall be dealt with in accordance with the applicable laws and regulations and the issuance rules set by the Company.
Note: This 50,000 thousand shares account for 1.78 % of the total number of the Company’s issued shares of 2,806,107,828 shares after stock cancellation of the First Buyback in Year 2011 from the date of May 26, 2014.
(4) Please discuss.

Resolution:

ITEM 7

Proposal: To Release the Restrictions on Competitive Activities of Newly-Elected Directors and their Representatives (Proposed by the Board of Directors)

Explanatory Notes:

(1) Pursuant to Article 209 of the Company Act, a director engaging, either for himself or on behalf of another person, in activities that are within the scope of the company's business, shall explain to the Shareholders' Meeting the essential contents of such activities and obtain its approval for conducting such activities.
(2) It is hereby proposed to request the 2014 General Shareholders’ Meeting to release the restriction on competitive activities for newly-elected directors or their corporate representatives, who participate in the operations of another company that engages in the same or similar business scope as the Company.
(3) Please discuss.

Resolution:

5. Extemporary Motion

6. Meeting Adjourned

C. Attachment Attachment 1

Business Report to Shareholders

The global ICT industry endured profound change in the past year, and obstacles within the company have resulted in our business underperformance. In fiscal year 2013, we reported consolidated revenues of NT$360.13 B, down 16.2% on year, loss after tax of NT$20.52B, and loss per share of NT$7.54. After adjustment due to compliance with the International Financial Reporting Standard (IFRS), our accumulated loss is NT$21.79B. We reported the above to all shareholders in accordance with laws (Article 211 of the Company Act) and regulations.

A main part of the loss was due to compliance with the IFRS to recognize NT$9.94B for the impairment of intangible assets in trademark rights etc. Other key factors of our loss were NT$3.18B for inventory write off and NT$1.02B for manpower reduction.

Consequently, our former chairman and president resigned to take responsibility. On November 5, I returned to Acer as chairman of the Transformation Committee. Then on November 21, I assumed the company chairmanship in order to transform and lead our company through during this important time.

I focused on re-engineering the organization culture and engraining the benevolent thinking of the Wangdao ideology, and hoped to combine the qualities of professionalism and entrepreneurship. I pushed for change in the company business strategy while restructuring the organization, and through extensive communication we reached the consensus to define the new corporate vision.

The consensus among all our employees was that a company without change cannot sustain! Following intensive internal communication, on December 18 we publicly announced Acer’s vision and basic direction for transformation, Build Your Own Cloud (BYOC™), a self-built cloud that will enable our customers to seamlessly integrate their PC and mobile devices to access their data — anytime, anywhere.

The vision is also about transforming from a hardware company into a "hardware + software + services" player as we prepare to embrace new opportunities in the era of cloud technology. Acer’s role in the future is to become the “enabler of BYOC,” and build in the BYOC angel into all Acer hardware and software. At the Computex Taipei international tradeshow in June we will showcase a wide range of BYOC services for all visitors to experience!

Finally, on January 1 this year, as Acer carried out a series of changes, I hired Jason Chen, former senior vice president of Worldwide Sales and Marketing at Taiwan Semiconductor Manufacturing Company (TSMC), as the new CEO and corporate president.

During this time, I held frequent in depth discussion with George Huang of the Transformation Committee and Jason on business management and strategy. An important conclusion we reached is the “5Cs” - Communication, Communication, Communication, Consensus, and Commitment – as Acer’s top-down management culture.

Through our efforts over the past few months our company has taken many new initiatives, and I feel assured that Acer is moving towards the right direction, as employee morale and confidence are gradually restored. The challenge that we face today was accumulated from long ago, therefore it cannot be expected for our operations to improve immediately. Time is needed for our efforts to reflect in the financial figures and I hope that you will have the patience.

I wish thank our shareholders over your long-term support for Acer. We truly appreciate your encouragement, and I hope you can uphold the original intention to continue supporting Acer.

Sincerely,

Stan Shih Chairman

Attachment 2

Independent Auditors’ Report

The Board of Directors Acer Incorporated:

We have audited the accompanying consolidated balance sheets of Acer Incorporated (the “Company”) and subsidiaries as of December 31, 2013 and 2012, and January 1, 2012, and the related consolidated statements of comprehensive income, changes in equity and cash flows for the years ended December 31, 2013 and 2012. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the “Regulations Governing Auditing and Certification of Financial Statements by Certified Public Accountants” and auditing standards generally accepted in the Republic of China. Those regulations and standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to in the first paragraph present fairly, in all material respects, the consolidated financial position of Acer Incorporated and subsidiaries as of December 31, 2013 and 2012 and January 1, 2012, and the results of their consolidated operations and their consolidated cash flows for the years then ended in conformity with the Guidelines Governing the Preparation of Financial Reports by Securities Issuers, the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations and SIC Interpretations endorsed by the Financial Supervisory Commission of the Republic of China.

We have also audited the non-consolidated statements of Acer Incorporated as of December 31, 2013, and 2012, and January 1, 2012, and the related statements of comprehensive income, change in equity, and cash flows for the years ended December 31, 2013 and 2012, on which we have issued an unqualified opinion.

Taipei, Taiwan (the Republic of China) March 27, 2014

Notes to Readers

The accompanying consolidated financial statements are intended only to present the financial position, results of operations, 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.

For the convenience of readers, the auditors’ report and the accompanying consolidated financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, the Chinese-language auditors’ report and separate financial statements shall prevail.

ACER INCORPORATED AND SUBSIDIARIES

Consolidated Balance Sheets

December 31, 2013, December 31, 2012 and January 1, 2012

(In thousands of New Taiwan dollars)

Assets Current assets: Cash and cash equivalents Financial assets at fair value through profit or loss－current Hedging derivative financial assets－current Available-for-sale financial assets－current Notes and accounts receivable, net Accounts receivables from related parties Other receivables Other receivables from related parties Current income tax assets Inventories Non-current assets held for sale Other current assets Total current assets Non-current assets: Available-for-sale financial assets－non-current Investments in associates Property, plant and equipment Investment property Intangible assets Deferred income tax assets Other non-current assets Other financial assets－non-current Total non-current assets Total assets		2013.12.31 42,983,663 246,295 12,161 123,130 62,081,029 22,712 1,701,702 17 1,272,678 35,566,324 - 3,079,144 147,088,855 2,900,334 176,334 6,133,729 1,590,433 28,720,088 1,903,883 820,243 1,165,811 43,410,855 190,499,710		2012.12.31 50,612,564 25,415 192,461 169,017 68,818,955 41,283 2,269,935 17 1,137,101 43,336,949 - 2,425,716 169,029,413 3,353,089 189,837 6,348,237 2,540,396 39,134,920 3,324,956 1,215,783 1,179,517 57,286,735 226,316,148		2012.1.1
	$ $					58,092,581 305,903 804,532 109,721 84,856,736 88,625 2,513,525 15,359 1,457,924 39,993,644 1,827,855 3,550,077 193,616,482 1,970,392 1,842,485 6,716,374 2,853,476 35,401,551 2,906,919 875,161 1,632,327 54,198,685 247,815,167

(Continued)

ACER INCORPORATED AND SUBSIDIARIES

Consolidated Balance Sheets

December 31, 2013, December 31, 2012 and January 1, 2012

(In thousands of New Taiwan dollars)

Liabilities and Equity Current liabilities: Short-term borrowings Financial liabilities at fair value through profit or loss－current Hedging derivative financial liabilities－current Notes and accounts payable Accounts payables to related parties Other payables Other payables to related parties Current income tax liabilities Provisions－current Current portion of bonds payable Current portion of long-term debt Other current liabilities Total current liabilities Non-current liabilities: Financial liabilities at fair value through profit or loss－non- current Bonds payable Long-term debt Provisions－non-current Deferred income tax liabilities Other non-current liabilities Total non-current liabilities Total liabilities Equity : Common stock Capital surplus Retained earnings: Legal reserve Special reserve Accumulated deficit Other reserves Treasury stock Equity attributable to shareholders of the Company Non-controlling interests Total equity Total liabilities and equity		2013.12.31 389,989 475,425 - 55,217,361 665 41,371,865 656 847,385 10,305,579 - 1,800,000 3,279,566 113,688,491 496,143 8,974,513 7,200,000 342,938 1,946,343 1,599,912 20,559,849 134,248,340 28,347,268 43,707,727 10,012,168 6,126,774 (24,464,794) (1,425,876) (6,054,286) 56,248,981 2,389 56,251,370 190,499,710		2012.12.31 349,974 411,313 1,149,400 71,638,728 - 39,934,153 1,914 2,326,966 11,000,810 4,783,589 9,000,000 2,232,140 142,828,987 653,583 3,948,504 - 192,055 3,086,843 1,402,156 9,283,141 152,112,128 28,347,268 43,403,533 12,607,933 6,126,774 (6,706,640) (3,522,896) (6,054,286) 74,201,686 2,334 74,204,020 226,316,148		2012.1.1
	$ $					358,120 56,212 179,685 77,096,776 7,256,885 43,593,577 184,975 2,589,758 10,042,398 - - 4,282,274 145,640,660 1,216,586 13,548,703 9,000,000 243,126 2,043,911 1,103,032 27,155,358 172,796,018 27,098,915 39,924,024 12,607,933 4,659,275 (2,697,535) (792,767) (5,783,104) 75,016,741 2,408 75,019,149 247,815,167

ACER INCORPORATED AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

For the years ended December 31, 2013 and 2012

(In thousands of New Taiwan dollars, except loss per share data)

Revenue $ Cost of sales Gross profit Operating expenses: Selling expenses Administrative expenses Research and development expenses Other expenses Total operating expenses Other operating income and loss – net Operating income (loss) Non-operating income and loss: Other income Other gains and losses Finance costs Share of profits of associates Impairment loss on property, plant, and equipment Impairment loss on intangible assets Impairment loss on investment property Total non-operating income and loss Loss before taxes Income tax Net loss Other comprehensive income: Exchange differences on translation of foreign operations Change in fair value of available-for-sale financial assets Change in fair value of cash flow hedges Actuarial gain (loss) from defined benefit plans Less: Income taxes related to components of other comprehensive income Other comprehensive income for the year, net of taxes Total comprehensive income for the year $ Net loss attributable to: Shareholders of the Company $ Non-controlling interests $ Total comprehensive income attributable to: Shareholders of the Company $ Non-controlling interests $ Loss per share (in New Taiwan dollars) : Basic loss per share $ Diluted loss per share $	2013 360,132,042 337,581,776 22,550,266 21,802,936 8,006,491 3,091,790 1,293,223 34,194,440 234,508 (11,409,666) 530,124 808,082 (909,476) 5,175 (143,102) (9,943,350) (1,523) (9,654,070) (21,063,736) 544,387 (20,519,349) 1,966,965 (274,147) 402,433 178,404 11,150 2,262,505 (18,256,844) (20,519,428) 79 (20,519,349) (18,256,899) 55 (18,256,844) (7.54) (7.54)	2012 429,627,192 394,405,154 35,222,038 25,590,482 5,843,110 2,875,809 288,051 34,597,452 313,911 938,497 670,568 411,841 (904,097) 108,406 - (3,496,114) - (3,209,396) (2,270,899) (190,059) (2,460,958) (2,042,400) (50,883) (637,375) (79,575) 618 (2,810,851) (5,271,809)
		(2,461,098) 140 (2,460,958) (5,271,735) (74) (5,271,809) (0.90) (0.90)

					Total equity	75,019,149		-		(219,106)	203,315		4,642,773		100,880	(271,182)	(2,460,958)	(2,810,851)	(5,271,809)	74,204,020			-			261,000	43,194	(20,519,349)	2,262,505	(18,256,844)	56,251,370
				Non-controlling	Total interests	75,016,741 2,408		- -		(219,106) -	203,315 -		4,642,773 -		100,880 -	(271,182) -	(2,461,098) 140	(2,810,637) (214)	(5,271,735) (74)	74,201,686 2,334			- -			261,000 -	43,194 -	(20,519,428) 79	2,262,529 (24)	(18,256,899) 55	56,248,981 2,389
					Treasury stock	(5,783,104)		-		-	-		-		-	(271,182)	-	-	-	(6,054,286)			-			-	-	-	-	-	(6,054,286)
					Total	(792,767)		-		-	-		-		-	-	-	(2,730,129)	(2,730,129)	(3,522,896)			-			-	-	-	2,097,020	2,097,020	(1,425,876)
Attributable to shareholders of the Company	Retained earnings Other reserves	Change in fair	Foreign currency value of Change in fair	Special Accumulated translation available-for-sale value of cash	Common stock Capital surplus Legal reserve reserve deficit Total differences financial assets flow hedges	$ 27,098,915 39,924,024 12,607,933 4,659,275 (2,697,535) 14,569,673 (189,094) (838,615) 234,942		- - - 1,467,499 (1,467,499) - - - -		- (219,106) - - - - - - -	- 203,315 - - - - - - -		1,221,782 3,420,991 - - - - - - -		26,571 74,309 - - - - - - -	- - - - - - - - -	- - - - (2,461,098) (2,461,098) - - -	- - - - (80,508) (80,508) (2,041,871) (50,883) (637,375)	- - - - (2,541,606) (2,541,606) (2,041,871_)_ (50,883) (637,375)	28,347,268 43,403,533 12,607,933 6,126,774 (6,706,640) 12,028,067 (2,230,965) (889,498) (402,433)			- - (2,595,765) - 2,595,765 - - - -			- 261,000 - - - - - - -	- 43,194 - - - - - - -	- - - - (20,519,428) (20,519,428) - - -	- - - - 165,509 165,509 1,968,734 (274,147) 402,433	- - - - (20,353,919) (20,353,919) 1,968,734 (274,147) 402,433	$ 28,347,268 43,707,727 10,012,168 6,126,774 (24,464,794) (8,325,852) (262,231) (1,163,645) -
						Balance at January 1, 2012	Appropriation approved by the stockholders:	Special reserve	Other changes in capital surplus:	Adjustments from investments in associates	Share-based compensation cost	Issuance of common shares for acquisition of a	subsidiary	Issuance of common stock from exercise of	employee stock options	Purchase of treasury stock	Net loss in 2012	Other comprehensive income in 2012	Total comprehensive income in 2012	Balance at December 31, 2012	Appropriation approved by the stockholders:	Decrease in legal reserve to offset accumulated	deficit	Other changes in capital surplus:	Conversion right from issuance of convertible	bonds	Share-based compensation cost	Net loss in 2013	Other comprehensive income in 2013	Total comprehensive income in 2013	Balance at December 31, 2013

ACER INCORPORATED AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the years ended December 31, 2013 and 2012

(In thousands of New Taiwan dollars)

Cash flows from operating activities: Loss before taxes Adjustments for: Non-cash profit and loss: Depreciation Amortization Share-based compensation cost Valuation loss (gain) on derivative financial assets and liabilities Interest expense Interest income Dividend income Effects of exchange rate changes on bonds payable Share of profits of associates Gain on disposal of property, plant and equipment, non-current assets held for sale and investment property, net Gain on disposal of available-for-sale financial assets Gain on disposal of investments in associates Impairment loss on non-financial assets Loss on purchase and redemption of bonds payable Other investment loss Total non-cash profit and loss Changes in operating assets and liabilities: Net changes in operating assets: Notes and accounts receivable Receivables from related parties Inventories Other receivables and other current assets Non-current accounts receivables Net changes in operating assets Net changes in operating liabilities: Notes and accounts payable Payables to related parties Other payables and other current liabilities Provisions Other non-current liabilities Net changes in operating liabilities Total changes in operating assets and liabilities Cash provided by (used in) operations Interest received Income taxes paid Net cash provided by (used in) operating activities	$	2013 (21,063,736) 947,566 1,751,961 306,597 (517,236) 909,476 (324,821) (205,303) 236,923 (5,175) (105,317) (227,722) - 10,087,975 73,972 38,995 12,967,891 6,737,926 18,571 7,710,531 (111,992) 16,569 14,371,605 (16,421,367) (593) 2,481,522 (544,348) 197,756 (14,287,030) 84,575 (8,011,270) 324,568 (964,282) (8,650,984)		2012 (2,270,899) 908,830 2,431,866 475,708 1,362,775 904,097 (503,021) (167,547) (408,723) (108,406) (775,222) (7,752) (475,312) 3,496,114 69,164 9,205 7,211,776 16,041,918 47,342 (3,426,365) 1,643,856 31,943 14,338,694 (5,458,048) (7,439,946) (5,895,492) 907,341 671,360 (17,214,785) (2,876,091) 2,064,786 503,038 (1,426,806)
				1,141,018

(Continued)

ACER INCORPORATED AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the years ended December 31, 2013 and 2012

(In thousands of New Taiwan dollars)

Cash flows from investing activities: Proceeds from sale of available-for-sale financial assets Purchase of investments in associates Proceeds from capital return of available-for-sale investment Additions to property, plant and equipment and investment property Proceeds from disposal of property, plant and equipment, non-current assets held for sale, and investment property Decrease in advances to related parties Additions to intangible assets Acquisition of a subsidiary, net of cash acquired Decrease (increase) in other non-current financial assets and other non- current assets Dividend received Net cash provided by (used in) investing activities Cash flows from financing activities: Increase (decrease) in short-term borrowings Issuance of bonds payable Purchase and redemption of bonds payable Proceeds from exercise of employee stock option Purchase of treasury stock Interest paid Net cash used in financing activities Effects of foreign exchange rate changes Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year $	2013 273,062 - 147,743 (377,087) 684,807 - (191,985) - (21,743) 213,269 728,066 40,015 6,000,000 (6,669,074) - - (396,800) (1,025,859) 1,319,876 (7,628,901) 50,612,564 42,983,663	2012 7,752 (5,577) 491,118 (812,619) 2,981,558 15,342 (180,353) (4,464,660) 71,451 175,646 (1,720,342) (8,146) - (5,283,113) 100,880 (271,182) (417,297) (5,878,858) (1,021,835) (7,480,017) 58,092,581 50,612,564

Independent Auditors’ Report

The Board of Directors Acer Incorporated:

We have audited the accompanying non-consolidated balance sheets of Acer Incorporated (the “Company”) as of December 31, 2013 and 2012 and January 1, 2012, the related non-consolidated statements of comprehensive income, changes in equity and cash flows for the years ended December 31, 2013 and 2012. These non-consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these non-consolidated financial statements based on our audits.

In our opinion, the non-consolidated financial statements referred to above present fairly, in all material respects, the non-consolidated financial position of Acer Incorporated as of December 31, 2013 and 2012 and January 1, 2012, and the results of its operations and its cash flows for the years then ended, in conformity with the Guidelines Governing the Preparation of Financial Reports by Securities Issuers.

Taipei, Taiwan (the Republic of China) March 27, 2014

Notes to Readers

ACER INCORPORATED

Balance Sheets

December 31, 2013, December 31, 2012 and January 1, 2012

(In thousands of New Taiwan dollars)

Assets Current assets: Cash and cash equivalents Financial assets at fair value through profit or loss－ current Hedging derivative financial assets－current Available-for-sale financial assets ‐current Notes and accounts receivable, net Accounts receivables from related parties Other receivables Other receivables from related parties Current income tax assets Inventories Other current assets Total current assets Non-current assets: Available-for-sale financial assets‐non-current Investments accounted for using equity method Property, plant and equipment Investment property Intangible assets Deferred income tax assets Other non-current assets Other financial assets‐non-current Total non-current assets Total assets		2013.12.31 20,960,475 12,067 - 77,684 4,958,635 19,554,304 1,091,173 332,234 127,792 12,436,092 805,314 60,355,770 2,164,512 72,923,024 1,703,498 1,699,264 781,218 - 387,871 483,684 80,143,071 140,498,841		2012.12.31 19,436,225 4,348 388 78,381 8,124,840 28,605,882 1,073,426 1,117,803 212,108 19,589,959 575,190 78,818,550 2,637,138 81,517,586 1,376,478 2,649,666 5,005,252 1,205,606 437,958 782,131 95,611,815 174,430,365		2012.1.1 30,769,328 39,221 650,104 66,446 9,103,502 43,467,442 996,129 366,019 287,111 15,567,695 661,561 101,974,558 1,398,461 75,551,633 1,560,967 2,858,742 8,460,029 997,989 445,726 1,035,234 92,308,781 194,283,339 (Continued)
	$ $

ACER INCORPORATED

Balance Sheets

December 31, 2013, December 31, 2012 and January 1, 2012

(In thousands of New Taiwan dollars)

Liabilities and Equity Current liabilities: Financial liabilities at fair value through profit or loss‐current Hedging derivative financial liabilities－current Notes and accounts payable Accounts payables to related parties Other payables Other payables to related parties Provisions‐current Current income tax liabilities Current portion of bonds payable Current portion of long-term debt Other current liabilities Total current liabilities Non-current liabilities: Financial liabilities at fair value through profit or loss‐non-current Bonds payable Long-term debt Deferred income tax liabilities Other non-current liabilities Total non-current liabilities Total liabilities Equity: Common stock Capital surplus Retained earnings: Legal reserve Special reserve Accumulated deficit Other reserves Treasury stock Total equity Total liabilities and equity		2013.12.31 265,663 - 44,620,889 138,933 17,657,290 230,465 1,474,168 195,970 - 1,800,000 323,790 66,707,168 496,143 8,974,513 7,200,000 252,063 619,973 17,542,692 84,249,860 28,347,268 43,707,727 10,012,168 6,126,774 (24,464,794) (1,425,876) (6,054,286) 56,248,981 140,498,841		2012.12.31 385,869 863,734 60,132,997 231,824 15,437,698 444,357 440,405 1,793,464 4,783,589 9,000,000 206,767 93,720,704 653,583 3,948,504 - 1,301,136 604,752 6,507,975 100,228,679 28,347,268 43,403,533 12,607,933 6,126,774 (6,706,640) (3,522,896) (6,054,286) 74,201,686 174,430,365		2012.1.1
	$ $					- 27,986 62,669,700 6,526,825 20,468,039 689,562 518,092 1,668,976 - - 325,198 92,894,378 1,216,586 13,548,703 9,000,000 2,063,112 543,819 26,372,220 119,266,598 27,098,915 39,924,024 12,607,933 4,659,275 (2,697,535) (792,767) (5,783,104) 75,016,741 194,283,339

ACER INCORPORATED

Statements of Comprehensive Income

For the years ended December 31, 2013 and 2012

(In thousands of New Taiwan dollars, except loss per share data)

Revenue Cost of sales Gross profit Less: Unrealized profit on intercompany sales Realized gross Profit Operating expenses: Selling expenses Administrative expenses Research and development expenses Other expenses Total operating expenses Other operating income and loss – net Operating income (loss) Non-operating income and loss: Other income Other gains and losses Finance costs Share of losses of subsidiaries and associates Impairment loss on investment property Impairment loss on intangible assets Total non-operating income and loss Loss before taxes Income tax benefit Net loss Other comprehensive income: Exchange differences on translation of foreign operations Change in fair value of available-for-sale financial assets Change in fair value of cash flow hedges Actuarial gain (loss) from defined benefit plans Share of other comprehensive income of subsidiaries and associates Less: Income tax expense (benefit) related to components of other comprehensive income Other comprehensive income for the year, net of tax Total comprehensive income for the year Loss per common share (in New Taiwan dollars): Basic loss per common share Diluted loss per common share		2013 273,910,017 270,721,685 3,188,332 25,146 3,163,186 5,481,642 2,167,633 1,937,028 82,000 9,668,303 88,928 (6,416,189) 96,724 1,066,020 (678,947) (11,693,557) (1,523) (4,025,173) (15,236,456) (21,652,645) (1,133,217) (20,519,428) 1,966,989 (318,799) 341,824 (536) 271,215 (1,836) 2,262,529 (18,256,899) (7.54) (7.54)		2012 359,944,584 350,838,850 9,105,734 30,177 9,075,557 5,101,248 1,145,364 1,741,657 - 7,988,269 119,938 1,207,226 154,141 (425,548) (691,406) (128,911) - (3,198,114)
	$ $ $ $







				(4,289,838) (3,082,612) (621,514) (2,461,098) (2,042,186) (144,759) (570,376) 19,500 (69,816) 3,000 (2,810,637) (5,271,735) (0.90) (0.90)

			Total equity of the	Company	75,016,741		-		(219,106)	(219,106)	203,315	4,642,773	100,880	(271,182)	(2,461,098)	(2,810,637)	(5,271,735)	74,201,686		-		261,000	43,194	(20,519,428)	2,262,529	(18,256,899)	56,248,981
				Treasury stock	(5,783,104)		-			-	-	-	-	(271,182)	-	-	-	(6,054,286)		-		-	-	-	-	-	(6,054,286)
				Total	(792,767)		-			-	-	-	-	-	-	(2,730,129)	(2,730,129)	(3,522,896)		-		-	-	-	2,097,020	2,097,020	(1,425,876)
Other reserves	Change in fair	value of Change in fair	available-for-sale value of cash	financial assets flow hedges	(838,615) 234,942		- -			- -	- -	- -	- -	- -	- -	(50,883) (637,375)	(50,883) (637,375)	(889,498) (402,433)		- -		- -	- -	- -	(274,147) 402,433	(274,147) 402,433	(1,163,645) -
	Foreign	currency	translation	differences	(189,094)		-			-	-	-	-	-	-	(2,041,871)	(2,041,871)	(2,230,965)		-		-	-	-	1,968,734	1,968,734	(262,231)
				Total	14,569,673		-			-	-	-	-	-	(2,461,098)	(80,508)	(2,541,606)	12,028,067		-		-	-	(20,519,428)	165,509	(20,353,919)	(8,325,852)
Retained earnings			Special Accumulated	Common stock Capital surplus Legal reserve reserve deficit	$ 27,098,915 39,924,024 12,607,933 4,659,275 (2,697,535)		- - - 1,467,499 (1,467,499)		- (219,106) - - -		- 203,315 - - -	1,221,782 3,420,991 - - -	26,571 74,309 - - -	- - - - -	- - - - (2,461,098)	- - - - (80,508)	- - - - (2,541,606)	28,347,268 43,403,533 12,607,933 6,126,774 (6,706,640)		- - (2,595,765) - 2,595,765		- 261,000 - - -	- 43,194 - - -	- - - - (20,519,428)	- - - - 165,509	- - - - (20,353,919)	$ 28,347,268 43,707,727 10,012,168 6,126,774 (24,464,794)
					Balance at January 1, 2012	Appropriation approved by the stockholders:	Special reserve	Other changes in capital surplus:	Adjustments from investments in associates		Share-based compensation cost	Issuance of common shares for acquisition of a subsidiary	Issuance of common stock from exercise of employee stock options	Purchase of treasury stock	Net loss in 2012	Other comprehensive income in 2012	Total comprehensive income in 2012	Balance at December 31, 2012	Appropriation approved by the stockholders:	Decrease in legal reserve to offset accumulated deficit	Other changes in capital surplus:	Conversion right from issuance of convertible bonds	Share-based compensation cost	Net loss in 2013	Other comprehensive income in 2013	Total comprehensive income in 2013	Balance at December 31, 2013

ACER INCORPORATED

Statements of Cash Flows

For the years ended December 31, 2013 and 2012

(In thousands of New Taiwan dollars)

Cash flows from operating activities: Loss before taxes $ Adjustments for: Non-cash profit and loss: Depreciation Amortization Share-based compensation cost Valuation loss (gain) on derivative financial assets and liabilities Interest expense Interest income Dividend income Effects of exchange rate changes on bonds payable Share of losses of subsidiaries and associates Gain on disposal of property, plant and equipment and investment property, net Gain on disposal of available-for-sale financial assets Impairment loss on non-financial assets Unrealized profit on intercompany sales Loss on purchase and redemption of bonds payable Other investment income Total non-cash profit and loss Changes in operating assets and liabilities: Net changes in operating assets: Notes and accounts receivable Receivables from related parties Inventories Other receivables and other current assets Net changes in operating assets Net changes in operating liabilities: Notes and accounts payable Payables to related parties Other payables and other current liabilities Provisions Other non-current liabilities Net changes in operating liabilities Total changes in operating assets and liabilities Cash provided by (used in) operations Interest received Income taxes paid Net cash provided by (used in) operating activities	2013 (21,652,645) 262,861 364,338 43,194 (440,247) 678,947 (16,703) (80,021) 236,923 11,693,557 (113,593) (121,691) 4,026,696 25,146 73,972 - 16,633,379 3,166,205 9,051,578 7,093,773 (247,488) 19,064,068 (15,512,108) (306,783) 2,337,006 1,033,763 (51,906) (12,500,028) 6,564,040 1,544,774 16,320 (221,592) 1,339,502	2012 (3,082,612) 257,997 415,958 203,315 1,118,605 691,406 (37,670) (116,471) (408,723) 128,911 (38,334) (231,776) 3,198,114 30,177 69,164 (115,680) 5,164,993 978,662 14,861,560 (4,105,324) 92,300 11,827,198 (2,536,703) (6,540,206) (5,091,167) (77,687) (3,556) (14,249,319) (2,422,121) (339,740) 37,732 (151,588) (453,596)

(Continued)

ACER INCORPORATED

Statements of Cash Flows

For the years ended December 31, 2013 and 2012

(In thousands of New Taiwan dollars)

Cash flows from investing activities: Proceeds from sale of available-for-sale financial assets Proceeds from capital return of available-for-sale financial assets Purchase of investments accounted for using equity method Proceeds from capital return or liquidation of investments Additions to property, plant and equipment and investment property Proceeds from disposal of property, plant and equipment and investment property Decrease (increase) in advances to related parties Additions to intangible assets Decrease (increase) in other non-current financial assets and other non-current assets Dividend received Net cash provided by (used in) investing activities Cash flows from financing activities: Issuance of bonds payable Purchase and redemption of bonds payable Proceeds from exercise of employee stock option Purchase of treasury stock Interest paid Net cash used in financing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year $	2013 167,031 109,183 (2,885,400) 291,000 (153,666) 667,311 1,037,564 (146,437) 82,439 1,855,075 1,024,100 6,000,000 (6,669,074) - - (170,278) (839,352) 1,524,250 19,436,225 20,960,475	2012 - 257,976 (5,500,020) 66,974 (64,710) 214,872 (499,784) (137,935) (23,150) 490,809 (5,194,968) - (5,283,113) 100,880 (271,182) (231,124) (5,684,539) (11,333,103) 30,769,328 19,436,225

Attachment 3

Comparison Table of Acer’s Regulations Governing Procedure for Board of Directors Meetings Before and After Revision

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Before Revision After Revision Purpose
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Before Revision	After Revision	Purpose

Article 3 The Board of Directors shall meet at least quarterly. The reasons for calling a Board meeting shall be notified to each director and supervisor at least seven days in advance. In emergency circumstances, however, a Board meeting may be called on shorter notice. The notice of Board meeting in this Article may be sent via electronic means with respective Board member’s consent.	Article 3 The Board of Directors shall meet at least quarterly. The reasons for calling a Board meeting shall be notified to each director~~and supervisor~~ at least seven days in advance. In emergency circumstances, however, a Board meeting may be called on shorter notice. The notice of Board meeting in this Article may be sent via electronic means with respective Board member’s consent.	In consideration of the establishment of the Company’s Audit Committee which will take the place of the Company’s existing Supervisor function
Article 17. I 1.Minutes shall be prepared of the discussions at Board meetings; the meeting minutes shall record the following factually in accordance with the applicable laws and regulations: (1) Session (or year), time, and place of meeting. (2) Name of the meeting chair. (3) Attendance of directors at the meeting, specifying the names and number of members present, excused, and absent. (4) Names and titles of those attending the meeting as nonvoting participants. (5) Name of minutes taker. (6) Matters reported on. (7) Agenda items: specify the resolution method and result for each proposal, the summary of the comments made by directors, supervisors, experts, or any others at the meeting, and the name of, and explanation to the key content of the personal interest of, the director(s) with personal interest as provided in Article 16, paragraph 1 above, the reason for recusal or non-recusal of such director(s) and the execution thereof, and specify any objections or reservations expressed by directors, supervisors, experts, or any others at the meeting that has been included in records or stated in writing, and any opinion issued in writing by an independent director under Article 7, paragraph 3.	Article 17. I 1. Minutes shall be prepared of the discussions at Board meetings; the meeting minutes shall record the following factually in accordance with the applicable laws and regulations: (1) Session (or year), time, and place of meeting. (2) Name of the meeting chair. (3) Attendance of directors at the meeting, specifying the names and number of members present, excused, and absent. (4) Names and titles of those attending the meeting as nonvoting participants. (5) Name of minutes taker. (6) Matters reported on. (7) Agenda items: specify the resolution method and result for each proposal, the summary of the comments made by director~~s,~~ ~~supervisors~~ , experts, or any others at the meeting, and the name of, and explanation to the key content of the personal interest of, the director(s) with personal interest as provided in Article 16, paragraph 1 above, the reason for recusal or non-recusal of such director(s) and the execution thereof, and specify any objections or reservations expressed by director~~s, supervisors~~ , experts, or any others at the meeting that has been included in records or stated in writing, and any opinion issued in writing by an independent director under Article 7, paragraph~~3~~ ~~5~~.	Same as above

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(8) Extraordinary motions: specify the name of the mover, the resolution method and result for each motion, the summary of the comments made by directors, supervisors, experts, or any others at the meeting, and the name of, and explanation to the key content of the personal interest of, the director(s) with personal interest as provided in Article 16, paragraph 1 above, the reason for recusal or non-recusal of such director(s) and the execution thereof, and specify any objections or reservations expressed by directors, supervisors, experts, or any others at the meeting that has been included in records or stated in writing. (9) Other matters required to be recorded.	(8) Extraordinary motions: specify the name of the mover, the resolution method and result for each motion, the summary of the comments made by directors,~~supervisors,~~ experts, or any others at the meeting, and the name of, and explanation to the key content of the personal interest of, the director(s) with personal interest as provided in Article 16, paragraph 1 above, the reason for recusal or non-recusal of such director(s) and the execution thereof, and specify any objections or reservations expressed by directors, ~~supervisors,~~ experts, or any others at the meeting that has been included in records or stated in writing. (9) Other matters required to be recorded.
Article 17. IV 4. The minutes of a Board meeting shall bear the signature or seal of both the meeting Chairman and the minutes taker; a copy of the minutes shall be distributed to each director and supervisor within 20 days after the meeting and well preserved as important company records during the existence of the Company.	Article 17. IV 4. The minutes of a Board meeting shall bear the signature or seal of both the meeting Chairman and the minutes taker; a copy of the minutes shall be distributed to each director~~and~~ ~~supervisor~~ within 20 days after the meeting and well preserved as important company records during the existence of the Company.	Same as above
Article 21 （Omitted）	Article 21 （Omitted） The third amendment was approved on March 27, 2014, and come into force upon the expiration of current supervisors’tenure in June, 2014.	Date of amendment and date of enforcement are added

Attachment 4

Comparison Table of Acer’s Election Regulation of Directors and Supervisors Before and After Revision

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Name of Regulation The Election Regulation of Directors and Supervisors	Name of Regulation The Election Regulation of Directors~~and~~ ~~Supervisors~~	To comply with the Company Act and Securities and Exchange Act, and coordinate with the Audit Committee system and candidate nomination system for election of the directors (including independent directors) newly adopted by the Company’s Articles of Incorporation and relevant rules
Article 1 Unless otherwise prescribed by the Company Law or the Company’s Articles of Incorporation, these Regulations shall govern the election of the Company’s directors and supervisors.	Article 1 Unless otherwise prescribed by the Company Law, relevant laws and regulations,or the Company’s Articles of Incorporation, these Regulations shall govern the election of the Company’s director~~s and supervisors~~ .	Same as above
Article 2 Company’s directors and supervisors shall be elected from those shareholders who are of full legal capacity under the law.	Article 2 Company’s directors~~and supervisors~~ shall be elected from those shareholders who are~~of full~~ ~~legal capacity under the law~~ on the candidate list for director positions announced by the Company by adopting the candidate nomination system.	Same as above
Article 3 Company’s directors and supervisors shall be elected through cumulative voting.	Article 3 Company’s director~~s and supervisors~~ shall be elected through cumulative voting.	Same as above
Article 4 When electing the Company’s directors and supervisors, each share shall be entitled to one vote for each director or supervisor to be elected. The holder of the shares may cast all votes for one candidate, or may distribute the votes among several candidates.	Article 4 When electing the Company’s directors~~and~~ ~~supervisors~~ , each share shall be entitled to one vote for each directo~~r or supervisor~~ to be elected. The holder of the shares may cast all votes for one candidate, or may distribute the votes among several candidates.	Same as above

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Article 5 The candidates who receive the most votes for the position of director or supervisor position shall win the election, and such number shall be in compliance with the number of positions for director or supervisor provided for in the Articles of Incorporation. In the event two or more candidates receive the same number of votes beyond a quota, the winner shall be determined by drawing lots. One lot may be drawn by the chairman for each of the absentees.	Article 5 The candidatesfor independent directors or non-independent directorswho receive the most votes for the position of director, with voting rights separately calculated for independent and non-independent director positions,~~or supervisor position~~ shall win the electionseparately,and such number shall be in compliance with the number of positions for directo~~r or supervisor~~ provided for in the Articles of Incorporation. In the event two or more candidates receive the same number of votes beyond a quota, the winner shall be determined by drawing lots. One lot may be drawn by the chairman for each of the absentees.	Same as above
Article 6 In the event a candidate is elected both director and supervisor for the same term, such candidate may choose either position but shall not accept both positions.	（Deleted）	Same as above
Article 14 These regulations were approved on February 17, 1993. （Omitted）	Article 14 These regulations were approved on February 17, 1993. （Omitted） The third amendment was approved on June 18, 2014.	Amendment date added

Attachment 5

LIST OF DIRECTOR CANDIDATES

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Academic Shareholdings
Name Experience Current Position
Background (Note 1)
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Name	Academic Background	Experience	Current Position	Shareholdings (Note 1)

Stan Shih (Shareholder's Acct. No.: 0000002)	BSEE, National Chiao Tung University, Taiwan	Co-Founder, Chairman President and CEO, Acer Group	1. Chairman, Acer 2. Independent Director, TSMC 3. Chairman, iD Branding Venture Inc. 4. Director, Wistron 5. Director, Nan Shan Life Insurance Co., ltd. 6. Director, Qisda 7. Director, Hung Rouan Investment Corp. 8. Director, Idealive International Co. Ltd. 9. Director, Egis Technology Inc. 10. Director, iD Branding Managerment Inc. 11. Director, iD Innovation Inc.	74,592,499 shares
George Huang (Shareholder's Acct. No.: 0000005)	MSEE, National Chiao Tung University, Taiwan	Co-Founder and CFO, Acer Group	1. Supervisor, Acer 2. Independent Director, PChome Online Inc. 3. Independent Director, Bio Net Corp. 4. Independent Director, Taiwan Taxi Co., LTD. 5. Independent Supervisor, InterServ International Inc. 6. Supervisor, Motech Industries Inc. 7. Supervisor, Les Enphants Co., Ltd. 8. Supervisor, Apacer Technology Inc.	8,261,844 shares
Hsin-I Lin (Shareholder's Acct. No.: 0620875)	Bachelor of Department of Mechanical Engineering, National Cheng- Kung University	1. Chairman, Industral Technology Research Institute 2. Vice Premier, Executive Yuan 3. Minister, Ministry of Economic Affairs	1. Director, Acer 2. Director, Yulon Motor Co., Ltd. 3. Director,China Motor Corp. 4. Independent Director, E.Sun Financial Holdings Co., Ltd. 5. Independent Director, Sinyi Realty Inc. 6. Chairman, Formosa Ha Tinh Steel Corp. 7. Chairman, Guang Yuan Investment Co., Ltd.	0 shares
Hung Rouan Investment Corp. Legal Representative: Carolyn Yeh (Shareholder's Acct. No.: 0005978)	Bachelor Degree, Fu Jen Catholic University	CAO, Acer	1. Supervisor, Acer 2. Independent Director, Capella Microsystems Inc., 3. Chairman, iDSoftcapotal Inc. 4. Chairman, Hung Rouan Investment Corp. 5. Director, AcoMo Technology Co., Ltd. 6. Director, IP Fund Six Co., Ltd. 7. Director, iD Innovation Inc. 8. Supervisor, Idealive International Co. Ltd. 9. Supervisor, ID Reengineering Fund Inc. 10. Supervisor, iD Branding Managerment Inc.	67,799,202 shares

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Academic Shareholdings
Name Experience Current Position
Background (Note 1)
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Name	Academic Background	Experience	Current Position	Shareholdings (Note 1)

Smart Capital Corp. Legal Representative: Philip Peng (Shareholder's Acct. No.: 0545878)	MBA, National Cheng Chi University	CFO, Acer	1. Director, Acer 2. Independent Director, AU Optronics Corp. 3. Chairman, Smart Capital Corp. 4. Director and President, iDSoftcapotal Inc. 5. Director, Wistron NeWeb Corporation 6. Director, Aopen Inc. 7. Director, Wistron Information & Services Corp. 8. Director, iD Branding Managerment Inc. 9. Director, ID Reengineering Fund Inc. 10. Supervisor, iD Innovation Inc.	11,260 shares
Jason C.S. Chen (Shareholder's Acct. No.: 0857788)	Master in Business Administration, Missouri-Columbia University, USA.	Senior Vice President of Worldwide Sales and Marketing, TSMC	1. CEO, Acer 2. Chairman, Mu-Jin Investment Co., Ltd.	50,000 shares (Note 2)

Note 1: The number of shares as of March 27, 2014. Note 2: Held by an investment company wholly owned by Mr. Jason C. S. Chen himself.

LIST OF INDEPENDENT DIRECTOR CANDIDATES

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F. C. Tseng (Shareholder's Acct. No.: 0771487)	Ph.D.in Electrical Engineering, National Cheng kung University	1. President, Vanguard International Semiconductor Corp. 2. Deputy CEO, TSMC	1. Independent Director, Acer 2. Chairman, Global Unichip Corp. 3. Vice Chairman, TSMC 4. Vice Chairman, Vanguard International Semiconductor Corp.
Ji-Ren Lee (Shareholder's Acct. No.: 0857786)	Doctoral Degree in Business Administration University, Illinois, USA	1. Vice Dean of Education and Resource Development , National Taiwan University College of Management 2. CEO, EMBA National Taiwan University	1. Professor, Department of International Business, National Taiwan University 2. Independent Director, E.Sun Financial Holdings Co., Ltd. 3. Independent Director, Wowprime Corp. 4. Outside Director, AVerMedia Technologies, Inc. 5. Chairman of Compensation Committee , Nien Hsing Textile Co., Ltd.
Chin-Cheng Wu (Shareholder's Acct. No.: 0857787)	Master Degree in Computer Science, Indiana University, USA	1. Co-founder and CEO, Azuki Systems 2. Chairman, Acopia Networks Inc.	1. VP & Technical Fellow, Ericsson 2. Independent Director, Vello Systems 3. Consultant of Innovation and Prospective Technology Project, Institute for Information Industry 4.Honorary Chairman, New England Chinese Information and Networking Association

Note: The number of shares as of March 27, 2014.

Attachment 6

Comparison Table of Acer’s Articles of Incorporation Before and After Revision

Before Revision After Revision Purpose Article 6 Article 6 To facilitate future operational The total amount of this Company capital stock The total amount of this Company capital stock is NT$ thirty-five billion divided into 3.5 billion is NT$ ~~thirty-five~~ forty billion divided into ~~3.5~~ 4 requirements. shares at par value of NT$10 per share, within billion shares at par value of NT$10 per share, which the board of directors is authorized to issue within which the board of directors is authorized shares in installments. NT$ two and half billion to issue shares in installments. NT$ two and half of the aforesaid total capital stock, divided into billion of the aforesaid total capital stock, divided 250 million shares each at a par value of NT$10, is into 250 million shares each at a par value of reserved for exercising stock options. NT$10, is reserved for exercising stock options. Article 12 Article 12 To facilitate Acer Audit This Company shall have nine (9) ~ eleven (11) This Company shall have ~~nine (9)~~ seven (7) ~ Committee setting and directors, to be elected from the nominees eleven (11) directors, to be elected from the practical requirements. listed in the roster of director with the candidate nominees listed in the roster of director with the nomination system. The term of office for candidate nomination system. The term of office directors and supervisors shall be three (3) years. for directors and supervisors shall be three (3) The directors are eligible for re-election. The years. The directors are eligible for re-election. total capital stock held by all directors shall not The total capital stock held by all directors shall be less than the percentage provided by the not be less than the percentage provided by the competent authority. The Company may buy the competent authority. The Company may buy the Responsibility Insurance for the Directors who Responsibility Insurance for the Director ~~s w~~ ho have to be responsible for the damages caused by have to be responsible for the damages caused by their duties. their duties. The Company shall establish three (3) or more The Company shall establish three (3) or more independent directors to be included in the independent directors to be included in the number of directors designated in the preceding number of directors designated in the preceding paragraph. The elections for independent paragraph. The elections for independent directors shall proceed with the candidate directors shall proceed with the candidate nomination system; the shareholders shall elect nomination system; the shareholders shall elect independent directors from among the nominees independent directors from among the nominees listed in the roster of independent director listed in the roster of independent director candidates. candidates. Article 22 Article 22 To increase the date of (ignored) (ignored) the amendment. - The forty second amendment was on June 18, 2014.

Attachment 7

Comparison Table of Acer’s Procedures of Acquiring or Disposing of Assets Before and After Revision

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Article 2 Scope of “assets” as used in these Procedures is as follows: 1. Investments in stocks, government bonds, corporate bonds, financial debentures, securities representing interest in a fund, depositary receipts, call (put) warrants, beneficial interest securities, and asset-backed securities, etc. 2. Real estate and other fixed assets. 3~7. (Omitted)	Article 2 Scope of “assets” as used in these Procedures is as follows: 1. Investments in stocks, government bonds, corporate bonds, financial debentures, securities representing interest in a fund, depositary receipts, call (put) warrants, beneficial interest securities, and asset-backed securities, etc. 2. Real estate(including land, houses and buildings, investment property, rights to use land, and construction enterprise inventory)andequipment ~~other fixed assets.~~ 3~7. (Omitted)	To comply with the FSC’s amendments to “Regulations Governing the Acquisition and Disposal of Assets by Public Companies”
Article 3 Definition Terms used in these Procedures are defined as follows: 1. “Derivative Products”: means forward contracts, options contracts, futures contracts, leverage contracts, and 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, fulfillment contracts, after-sales service contracts, long- term leasing contracts and long-term purchase (sale) contracts. 2. “Assets Acquired or Disposed Through Mergers, Splits, Acquisitions or Share transfer Pursuant to Laws”: means assets acquired or disposed through mergers, splits, acquisitions in accordance with the Business Mergers and Acquisitions Act, Financial Holding Company Act, Financial Institution Merger Act and other acts or, or to share transfer from another company through issuance of the Company’s new shares as the consideration therefor (hereinafter “share transfer”) under six paragraph of Article 156 of the Company Act. 3. “Related Party”: As used in these Procedures, means which is provided pursuant to No. 6 of the ROC Statements of Financial Accounting Standards promulgated by Accounting Research and Development Foundation of the Republic of China.	Article 3 Definition Terms used in these Procedures are defined as follows: 1. “Derivative Products”: means forward contracts, options contracts, futures contracts, leverage contracts, and 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, fulfillment contracts, after-sales service contracts, long-term leasing contracts and long- term purchase (sale) contracts. 2. “Assets Acquired or Disposed Through Mergers, Splits, Acquisitions or Share transfer Pursuant to Laws”: means assets acquired or disposed through mergers, splits, acquisitions in accordance with the Business Mergers and Acquisitions Act, Financial Holding Company Act, Financial Institution Merger Act and other acts or, or to share transfer from another company through issuance of the Company’s new shares as the consideration therefor (hereinafter “share transfer”) under~~six~~ paragraph 8 of Article 156 of Company Act. 3. “Related Party”and“Subsidiary”:As used in these Procedures, means which is provided pursuant to ~~No. 6 of the ROC Statements of Financial Accounting~~ ~~Standards promulgated by Accounting Research~~ ~~and Development Foundation of the Republic of~~ ~~China~~ ~~R~~egulations Governing the Preparation of Financial Reports by Securities Issuers.	Same as above

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4. “Date of occurrence of the event”: means the date of contract signing, date of payment, date of consignment trading, date of transfer, date of resolution of Board of Directors, or other date which can confirm the counterparty and trading amount (whichever date is earlier); provided, for investment 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. 5. “Professional appraiser”: refers to a real property appraiser or other person duly authorized by an act of law to engage in the value appraisal of real property or other fixed assets. 6. “Subsidiary”: As defined in Statements of Financial Accounting Standards Nos. 5 and 7 published by Accounting Research and Development Foundation of the Republic of China. 7. “Mainland area investment”: refers to investments in China approved by the 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.	4. “Date of occurrence of the event”: means the date of contract signing, date of payment, date of consignment trading, date of transfer, date of resolution of Board of Directors, or other date which can confirm the counterparty and trading amount (whichever date is earlier); provided, for investment 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. 5. “Professional appraiser”: refers to a real property appraiser or other person duly authorized by an act of law to engage in the value appraisal of real property or other fixed assets. ~~6.~~“~~Subsidiary~~”~~: As defined in Statements of Financial~~ ~~Accounting Standards Nos. 5 and 7 published by~~ ~~Accounting Research and Development Foundation~~ ~~of the Republic of China.~~ ~~7~~ 6.“Mainland area investment”: refers to investments in China approved by the 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 6 The Standards for Public Announcement 1. For acquisition or disposal of the Company’s assets as provided below, the Company shall announce the same at the website designated by the Competent Authority in a form stipulated by the Competent Authority based on its nature, within two days commencing immediately from the date of occurrence of said matter: (1) acquisition or disposal of real estate from related party; or the acquisition or disposal of other assets other than real estate from related party and the transaction amount reaches 20% of the Company’s paid-in capital, 10% of the Company’s total assets or NT$300 million or more; provided, however, that trading of government bonds or bonds under repurchase and resale agreements. (2) proceeding mergers, splits, acquisition or share transfer. (3) engaging in derivative products transactions and the loss reaching the maximum loss limit amount of the total or individual contract as provided in relevant procedures.	Article 6 The Standards for Public Announcement 1. For acquisition or disposal of the Company’s assets as provided below, the Company shall announce the same at the website designated by the Competent Authority in a form stipulated by the Competent Authority based on its nature, within two days commencing immediately from the date of occurrence of said matter: (1) acquisition or disposal of real estate from related party; or the acquisition or disposal of other assets other than real estate from related party and the transaction amount reaches 20% of the Company’s paid-in capital, 10% of the Company’s total assets or NT$300 million or more; provided, however, that trading of government bonds or bonds under repurchase and resale agreement~~s.~~ or subscription or redemption of domestic money market funds. (2) proceeding mergers, splits, acquisition or share transfer. (3) engaging in derivative products transactions and the loss reaching the maximum loss limit amount of the total or individual contract as provided in relevant procedures.	Same as above

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(4) asset transactions other than those provided in the preceding items (1), (2) and (3), or investment in Mainland China, the transaction amount reaches 20% of the Company’s paid-in capital or NT$300 million or more; provided, however, that the following situations are not applied: (a) purchase and sale of government bond. (b) trading of bonds under repurchase/resale agreements. (c) where the type of asset acquired or disposed is equipment/machinery for business use, the counterparty is not a related party, and the transaction amount is less than NT$500 million. (d) where land is acquired under an arrangement on engaging others to build on the company’s own land, engaging others to build on a leased 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 is less than NT$500 million. (Omitted)	(4) asset transactions other than those provided in the preceding items (1), (2) and (3), or investment in Mainland China, the transaction amount reaches 20% of the Company’s paid-in capital or NT$300 million or more; provided, however, that the following situations are not applied: (a) purchase and sale of government bond. (b) trading of bonds under repurchase/resale agreements, or subscription or redemption of domestic money market funds (c) where the type of asset acquired or disposed is equipmen~~t/machinery~~ for business use, the counterparty is not a related party, and the transaction amount is less than NT$500 million. (d) where land is acquired under an arrangement on engaging others to build on the company’s own land, engaging others to build on a leased 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 is less than NT$500 million. (Omitted)
Article 10 Appraisal Report from Professional Appraisal Institutions In acquiring or disposing of real estates or other fixed assets, where the transaction amount reaches 20% of the company’s paid-in capital or NT$300 million or more, the Company, unless otherwise transacted with a government agency, engaging others to build on its own land, engaging others to build on leased land, or acquiring or disposing of machines and equipment for business use, the Company shall obtain an appraisal report prior to the date of occurrence of the event from a professional appraisal institution and shall further comply with the following provisions: (Omitted)	Article 10 Appraisal Report from Professional Appraisal Institutions In acquiring or disposing of real estates or~~other fixed~~ ~~assets~~ equipment,where the transaction amount reaches 20% of the company’s paid-in capital or NT$300 million or more, the Company, unless otherwise transacted with a government agency, engaging others to build on its own land, engaging others to build on leased land, or acquiring or disposing of~~machines and~~ equipment for business use, the Company shall obtain an appraisal report prior to the date of occurrence of the event from a professional appraisal institution and shall further comply with the following provisions: (Omitted)	Same as above

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Article 11 Certified Public Accountant’s Opinions 1. The Company acquiring or disposing of securities shall, prior to the date of occurrence of the event, obtain financial statements of the issuing company for the most recent period, certified or reviewed by a certified public accountant, for reference in appraising the transaction price, and if the transaction amount reaches 20% of the Company’s paid-in capital or NT$300 million or more, a certified public accountant shall be retained prior to the date of occurrence of the event to provide an opinion regarding the reasonableness of the transaction price. If the CPA needs to use the report of an expert as evidence, the CPA shall do so in accordance with the provisions of Statement of Auditing Standards No. 20 published by Accounting Research and Development Foundation. This requirement does not apply, however, to publicly quoted prices of securities that have an active market, or where otherwise provided by regulations of the Competent Authority. 2. In acquiring or disposing membership certificate or intangible assets and the transaction amount reaches 20% of the Company’s paid-in capital or NT$300 million or more, 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 Accounting Research and Development Foundation. 3. (Omitted)	Article 11 Certified Public Accountant’s Opinions 1. The Company acquiring or disposing of securities shall, prior to the date of occurrence of the event, obtain financial statements of the issuing company for the most recent period, certified or reviewed by a certified public accountant, for reference in appraising the transaction price, and if the transaction amount reaches 20% of the Company’s paid-in capital or NT$300 million or more, a certified public accountant shall be retained prior to the date of occurrence of the event to provide an opinion regarding the reasonableness of the transaction price. If the CPA needs to use the report of an expert as evidence, the CPA shall do so in accordance with the provisions of Statement of Auditing Standards No. 20 published bythe ROCAccounting Research and Development Foundation. This requirement does not apply, however, to publicly quoted prices of securities that have an active market, or where otherwise provided by regulations of the Competent Authority. 2. In acquiring or disposing membership certificate or intangible assets and 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,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 bythe ROC Accounting Research and Development Foundation. 3. (Omitted)	Same as above
Paragraph 1 of Article 12 The acquisition or disposal of real estate from related parties, or the acquisition or disposal of other assets other than real estate from related party, and the transaction amount reaches 20% of the Company’s paid-in capital, 10% of the Company’s total assets or NT$300 million or more; provided, the Company shall submit information provided below to Board of Directors for approval and to supervisors for recognition before signing the contracts and payments: (Omitted)	Paragraph 1 of Article 12 The acquisition or disposal of real estate from related parties, or the acquisition or disposal of other assets other than real estate from related party, and the transaction amount reaches 20% of the Company’s paid-in capital, 10% of the Company’s total assets or NT$300 million or more; provided,unless trading of government bonds or bonds under repurchase and resale agreements. or subscription or redemption of domestic money market funds,the Company shall submit information provided below tothe audit committee for approval of more than half of all audit committee members and then submit the same to theBoard of Directors for furtherapproval ~~and to supervisors for recognition~~ before signing the contracts and payments: (Omitted)	To comply with the FSC’s amendments to “Regulations Governing the Acquisition and Disposal of Assets by Public Companies” and consider Acer’s establishment of Audit Committee

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Paragraph 2 of Article 12 The transaction amount in the preceding paragraph is calculated in accordance with Paragraph 2 of Article 6; “within one year” as used in these Procedures refers to the year preceding the date of occurrence of the current transaction. Items duly approved by the Board of Directors and recognized by supervisors in accordance with these Procedures need not be counted toward the transaction amount.	Paragraph 2 of Article 12 The transaction amount in the preceding paragraph is calculated in accordance with Paragraph 2 of Article 6; “within one year” as used in these Procedures refers to the year preceding the date of occurrence of the current transaction. Items duly approved bymore than half of all audit committee members and submit tothe Board of Directors for further approval~~and recognized~~ ~~by supervisors~~ in accordance with these Procedures need not be counted toward the transaction amount.	Same as above
Paragraph 5 of Article 13 1. 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 Article 12 and the preceding four paragraphs do not apply: (1) the related party acquires real estate through inheritance or as a gift. (2) more than 5 years will have elapsed from the time the related party signed the contract to obtain the real property to the signing date for the current transaction. (3) the real property is acquired through signing of a joint development contract with the related party.	Paragraph 5 of Article 13 1. 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 Article 12 and the preceding four paragraphs do not apply: (1) the related party acquires real estate through inheritance or as a gift. (2) more than 5 years will have elapsed from the time the related party signed the contract to obtain the real property to the signing date for the current transaction. (3) the real property is acquired through 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 leased land.	To comply with the FSC’s amendments to “Regulations Governing the Acquisition and Disposal of Assets by Public Companies”
Article 15 Where the Company acquires real property from a related party and the results of appraisals conducted in accordance with Articles 13 and 14 are all lower than the transaction price, the following steps shall be done: 1. a special reserve shall be set aside against the difference between the real property transaction price and the appraised cost. 2. the supervisors handling the matter pursuant to Article 218 of the Company Act. 3. actions taken pursuant to the preceding subparagraphs 1 and 2 shall be reported to a shareholders meeting, and the details of the transaction shall be disclosed in the annual report and prospectus. After setting aside a special reserve pursuant to the preceding paragraph, the Company 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, or the assets have been disposed of, 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 Competent Authority has given its consent.	Article 15 Where the Company acquires real property from a related party and the results of appraisals conducted in accordance with Articles 13 and 14 are all lower than the transaction priceor there are evidences showing that the aforesaid transaction is non-arm’s length transaction, the following items shall be done: 1. a special reserve shall be set aside against the difference between the real property transaction price and the appraised cost. 2. theaudit committee ~~supervisors~~ handling the matter pursuant to Article 218 of the Company Law 3. actions taken pursuant to the preceding subparagraphs 1 and 2 shall be reported to a shareholders meeting, and the details of the transaction shall be disclosed in the annual report and prospectus. After setting aside a special reserve pursuant to the preceding paragraph, the Company 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, or the assets have been disposed of, 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 Competent Authority has given its consent.	To comply with the FSC’s amendments to “Regulations Governing the Acquisition and Disposal of Assets by Public Companies” and consider Acer’s establishment of Audit Committee

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Article 18 (Omitted) The Principles of Supervision and Control of the High-Level Managers Authorized by the Board of Directors: 1. Periodically evaluate the risk management measures currently employed are appropriate and are faithfully conducted in accordance with these Procedures and the “Rules to Engage in the Transaction of Derivative Products” stipulated by the Company. 2. When irregular circumstances are found in the course of supervising trading and profit-loss circumstances, appropriate measures shall be adopted and a report immediately made to the Board of Directors; where the Company has independent directors, an independent director shall be present at the meeting and express an opinion. The Company shall report to the Board of Directors after it authorizes the relevant personnel to handle derivative trading in accordance with its Procedures for Engaging in Derivatives Trading.	Article 18 (Omitted) The Principles of Supervision and Control of the High- Level Managers Authorized by the Board of Directors: 1. Periodically evaluate the risk management measures currently employed are appropriate and are faithfully conducted in accordance with these Procedures and the “Rules to Engage in the Transaction of Derivative Products” stipulated by the Company. 2. When irregular circumstances are found in the course of supervising trading and profit-loss circumstances, appropriate measures shall be adopted and a report immediately made to the Board of Directors; where the Company has independent directors, an independent director shall be present at the meeting and express an opinion. The Company shall report to thenext meeting ofthe Board of Directors after it authorizes the relevant personnel to handle derivative trading in accordance with its Procedures for Engaging in Derivatives Trading.	To comply with the FSC’s amendments to “Regulations Governing the Acquisition and Disposal of Assets by Public Companies”
Paragraph 2 of Article 19 The Company’s internal auditors shall periodically check the suitability of internal controls on derivative transactions and conduct a monthly audit of compliance of the trading departments with the Procedures to Engage in the Transaction of Derivative Products, and prepare an audit report. If any material violation is discovered, each supervisor shall be notified in writing.	Paragraph 2 of Article 19 The Company’s internal auditors shall periodically check the suitability of internal controls on derivative transactions and conduct a monthly audit of compliance of the trading departments with the Procedures to Engage in the Transaction of Derivative Products, and prepare an audit report. If any material violation is discovered,~~each supervisor~~ the audit committeeshall be notified in writing.	To consider Acer’s establishment of Audit Committee

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Article 28 Others 1. Matters not provided herein shall be governed by the relevant laws and regulations and relevant internal rules of the Company. If the Procedures of Acquisition or Disposal of Assets in the original ruling is amended by the competent authority, the Company shall apply the provisions in the new ruling 2. These Procedures shall be approved by the Board of Directors, submitted to each supervisor and reported to the shareholders’ meeting for approval. The same procedures shall apply with any amendment hereto. If a director holds dissenting opinions of Company’s matters and there were records for it or in written stating, the Company shall submit materials of the director’s dissenting opinions to the each supervisor. 3. For the Company’s matters which shall be approved by the Board of Directors pursuant to these Procedures or other laws, where a director holds dissenting opinions on the Company’s matters and there were relevant records or made in writing, the Company shall submit materials of the director’s dissenting opinions to each supervisor. 4. When the Company reports the transaction of acquisition or disposal of assets pursuant to the preceding two paragraphs to the Board of Directors for discussion, in case the position of independent director is established in accordance with the law, the Board of Directors shall fully take each independent director’s opinions into consideration. If an independent director objects to or expresses reservations about any matter, it shall be recorded in the minutes of the board of directors meeting. 5. Where an audit committee is established in accordance with the law, these Procedures shall be adopted or amended by more than half of all audit committee members’ approval and submitted to the board of directors for a resolution. 6. If approval of more than half of all audit committee members as required in Paragraph 2 is not obtained, these Procedures may be implemented if approved by more than two- thirds of all directors, and the resolution of the audit committee shall be recorded in the minutes of the board of directors meeting.	Article 28 Others 1. Matters not provided herein shall be governed by the relevant laws and regulations and relevant internal rules of the Company. If the Procedures of Acquisition or Disposal of Assets in the original ruling is amended by the competent authority, the Company shall apply the provisions in the new ruling. 2. These Procedures shall be approved by more than half of all audit committee members and submitted tothe Board of Directorsfor further approva~~l, submitted to each supervisor~~ and reported to the shareholders’ meeting for approval. The same procedures shall apply with any amendment hereto. If a director holds dissenting opinions of Company’s matters and there were records for it or in written stating, the Company shall submit materials of the director’s dissenting opinions to~~each~~ ~~supervisor~~ audit committee. 3. For the Company’s matters which shall be approved by the Board of Directors pursuant to these Procedures or other laws, where a director holds dissenting opinions on the Company’s matters and there were relevant records or made in writing, the Company shall submit materials of the director’s dissenting opinions toaudit committee~~each supervisor~~ . 4. When the Company reports the transaction of acquisition or disposal of assets pursuant to the preceding two paragraphs to the Board of Directors for discussion, in case the position of independent director is established in accordance with the law, the Board of Directors shall fully take each independent director’s opinions into consideration. If an independent director objects to or expresses reservations about any matter, it shall be recorded in the minutes of the board of directors meeting. ~~5. Where an audit committee is established in~~ ~~accordance with the law, these Procedures~~ ~~shall be adopted or amended by more than~~ ~~half of all audit committee members~~’~~approval~~ ~~and submitted to the board of directors for a~~ ~~resolution.~~ ~~6~~ ~~5~~. If approval of more than half of all audit committee members as required in Paragraph 2 is not obtained, these Procedures may be implemented if approved by more than two- thirds of all directors, and the resolution of the audit committee shall be recorded in the minutes of the board of directors meeting.	To comply with the FSC’s amendments to “Regulations Governing the Acquisition and Disposal of Assets by Public Companies” and consider Acer’s establishment of Audit Committee

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7. The terms “all audit committee members” in paragraph 5 and “all directors” in the preceding paragraph shall be calculated as the actual number of persons currently holding those positions. 8. Where an audit committee is established in accordance with the law, the provisions set out in Subparagraph 2 of Paragraph 1 of Article 15 shall apply mutatis mutandis to the independent director as the member of audit committee; and the other the provisions regarding supervisors shall apply mutatis mutandis to the audit committee. 9. Another stricter management principles may be drafted by the Company’s Chairman in accordance with these Procedures and be effective after approval by the Board of Directors with two-thirds vote at a meeting attended by more than two-thirds of the directors. The same procedure shall apply to any amendment thereto. 10 Where foreign company’s share is no-par stock or its par value per share is not the NT$10, the transaction amount calculation related to 20% of the paid-in capital under Article 6, 8 and Article 10 to Article 12 shall be calculated by 10% of shareholders’ equity.	~~7~~ ~~6~~. The terms “all audit committee members” in~~paragraph 5~~ these Proceduresand “all directors” in the preceding paragraph shall be calculated as the actual number of persons currently holding those positions. ~~8~~ ~~7~~.Where an audit committee is established in accordance with the law, the provisions set out in Subparagraph 2 of Paragraph 1 of Article 15 shall apply mutatis mutandis to the independent director as the member of audit committee; and the other the provisions regarding supervisors shall apply mutatis mutandis to the audit committee. ~~9~~ ~~8~~.Another stricter management principles may be drafted by the Company’s Chairman in accordance with these Procedures and be effective after approval by the Board of Directors with two-thirds vote at a meeting attended by more than two-thirds of the directors. The same procedure shall apply to any amendment thereto. ~~10~~ ~~9~~.Wher~~e foreign~~ ~~t~~hecompany’s share is no-par stock or its par value per share is not the NT$10, the transaction amount calculation related to 20% of the paid-in capital under Articles6, 8 and Article 10 to Article 12 shall be calculated based on 10% of equity attributable to owners of the parent~~by 10% of shareholders~~’~~equity~~ . 10. For calculation of 10% of total assets under these Procedures, the total assets stated in the most recent parent company only financial report prepared in accordance with Regulations Governing the Preparation of Financial Reports by Securities Issuers shall be used.
Article 29 The Procedures were enacted on July 28, 1995. (Omitted)	Article 29 The Procedures were enacted on July 28, 1995. (Omitted) The sixth amendment was made on June 18, 2014.	Addition of amendment date

Attachment 8

Comparison Table of Acer’s Foreign Exchange Risk Management Policy and Guidelines Before and After Revision

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3-1-5 Loss Limit：	The losses limit authorization table of FX deals on aggregate and individual contract was set up according to the exposure. Authorization Losses limit % on aggregate or individual contract Chairman 20% President 15% CFO 10% Head of Treasury Dept. 5% If the loss amount reaches the above limit, the person with authority should be reported promptly and the authorized manager should give competent instruction; if the loss amount reach 25% and company should publicly announce by regulations and submit the relevant information to each supervisor and Board of Director.	The losses limit authorization table of FX deals on aggregate and individual contract was set up according to the exposure. Authorization Losses limit % on aggregate or individual contract Chairman 20% President 15% CFO 10% Head of Treasury Dept. 5% If the loss amount reaches the above limit, the person with authority should be reported promptly and the authorized manager should give competent instruction; if the loss amount reach 25% and company should publicly announce by regulations and submit the relevant information to audit committee ~~each~~ ~~supervisor~~ and Board of Director.	To consider Acer’s establishment of Audit Committee
3-6 Audit	Internal auditors should understand the appropriateness of the internal control, investigate whether the dealing procedure follow the “Procedures of acquiring or disposing of assets” or not and generate the auditing report. The report in writing should be submitted to each supervisor if any violation.	Internal auditors should understand the appropriateness of the internal control, investigate whether the dealing procedure follow the “Procedures of acquiring or disposing of assets” or not and generate the auditing report. The report in writing should be submitted to~~each supervisor~~ audit committee if any violation.	Same as above
3-7	The Policy and amendments shall come into force after resolved by the Board of Directors, be submitted to each supervisor and upon the consent of shareholders meeting.	The Policy and amendments shall~~come into~~ ~~force after resolved~~ be approvedbymore than half of all audit committee members and submitted to the Board of Directors for further approval, and reported to~~be submitted~~ ~~to each supervisor and upon the consent of~~ shareholders meetingfor approval. If a director holds dissenting opinions of Company’s matters and there were records for it or in written stating, the Company shall submit materials of the director’s dissenting opinions to audit committee. If approval of more than half of all audit committee members as required in the preceding paragraph is not obtained, the Policy may be implemented if approved by more than two-thirds of all directors, provided that the resolution of the audit committee is recorded in the minutes of the board of directors meeting. The terms“all audit committee members” in the preceding two paragraphs and“all directors”in the preceding paragraph shall be calculated as the actual number of persons currently holding those positions.	Same as above

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3-8	The Policy was enacted on March 26, 2003. (Omitted)	The Policy was enacted on March 26, 2003. (Omitted) The 2 ndamendment was made on June 18, 2014.	Addition of amendment date

Attachment 9

Comparison Table of Acer’s Procedures Governing Lending of Capital to Others Before and After Revision

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Preamble All loans made by the Company shall comply with these Procedures. Matters not provided herein shall be governed by the relevant laws and regulations and the relevant regulations of the Company.	~~Preamble~~ ~~All loans made by the Company shall comply~~ ~~with these Procedures. Matters not provided~~ ~~herein shall be governed by the relevant laws~~ ~~and regulations and the relevant regulations~~ ~~of the Company.~~	Renumbering of clause
Article 2 The Standard for Lending Assessment 1~2. (Omitted)	Article 2 The Standard for Lending Assessment 1~2. (Omitted) 3.“Subsidiary”used in these Procedures means which is provided pursuant to Regulations Governing the Preparation of Financial Reports by Securities Issuers.	To comply with the FSC’s amendments to “Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies”

Article 3 Limits on Loan 1~3. (Omitted)	Article 3 Limits on Loan 1~3. (Omitted) 4.“net worth”in these Procedures means the balance sheet equity attributable to the owners of the parent company under the Regulations Governing the Preparation of Financial Reports by Securities Issuers.	Same as above

Article 7 1. (Omitted) 2. In the event that the loan amount provided by the Company and its subsidiaries reaches the following thresholds, the Company shall make a public announcement within two days after the occurrence of said lending: (Omitted)	Article 7 1. (Omitted) 2. In the event that the loan amount provided by the Company and its subsidiaries reaches the following thresholds, the Company shall make a public announcement within two dayscommencing immediately from~~after~~ thedate ofoccurrence of said lending (Omitted)	Same as above
Article 12 The internal audit personnel of the Company shall verify these Procedures and its implementation at least once every quarter and prepare a written report for record. If there is signifcant violation, the personnel shall inform the supervisors in writing immediately.	Article 12 The internal audit personnel of the Company shall verify these Procedures and its implementation at least once every quarter and prepare a written report for record. If there is signifcant violation, the personnel shall informaudit committee~~the supervisors~~ in writingimmediately.	To consider Acer’s establishment of Audit Committee
Article 14 (Omitted) Where the borrower becomes unqualifed under these Procedures or the loan amount exceeds the limit as a result of changes of condition, the Company shall adopt rectifcation plans and submit the same to all the supervisors, and complete the rectifcation in accordance with the schedule.	Article 14 (Omitted) Where the borrower becomes unqualifed under these Procedures or the loan amount exceeds the limit as a result of changes of condition, the Company shall adopt rectifcation plans and submit the same to ~~all the supervisors~~ audit committee,and complete the rectifcation in accordance with the schedule.	Same as above

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Article 15 These Procedures, as well as any revision thereto, shall be approved by the Chairman of the board and fled with the Board of Directors for approval and sent to each supervisor and submitted to the shareholder meeting for approval.	Article 15 These Procedures, as well as any revision thereto, shall be approved bymore than half of all audit committee members and submitted to ~~the Chairman of the board and fled with~~ the Board of Directors forfurtherapproval, and~~sent to each supervisor and~~ submitted to the shareholdersmeeting for approval. If a director holds dissenting opinions of Company’s matters and there were records for it or in written stating, the Company shall submit materials of the director’s dissenting opinions to audit committee. If approval of more than half of all audit committee members as required in the preceding paragraph is not obtained, these Procedures may be implemented if approved by more than two-thirds of all directors, provided that the resolution of the audit committee is recorded in the minutes of the board of directors meeting. The terms“all audit committee members” in the preceding two paragraphs and“all directors”in the preceding paragraph shall be calculated as the actual number of persons currently holding those positions.	Same as above
	(Addition) Article 17 All loans made by the Company shall comply with these Procedures. Matters not provided herein shall be governed by the relevant laws and regulations and the relevant regulations of the Company.	Renumbering of clause
Article 17 Approved by General Shareholder’s Meeting held on January 15, 1993; (Omitted)	Article~~17~~ 18 Approved by General Shareholder’s Meeting held on January 15, 1993; (Omitted) The 9thamendment was made on June 18, 2014.	Addition of amendment date

Attachment 10

Comparison Table of Acer’s Procedures Governing Endorsement and Guarantee Before and After Revision

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Preamble All endorsements and guarantees made by the Company shall comply with these Procedures. Matters not provided herein shall be governed by the relevant laws and regulations and the relevant regulations of the Company.	~~Preamble~~ ~~All endorsements and guarantees made by the~~ ~~Company shall comply with these Procedures.~~ ~~Matters not provided herein shall be governed by~~ ~~the relevant laws and regulations and the relevant~~ ~~regulations of the Company.~~	Addition of amendment date
Article 2 Applicability (Omitted)	Article 2 Applicability (Omitted) (Addition) “Subsidiary”used in these Procedures means which is provided pursuant to Regulations Governing the Preparation of Financial Reports by Securities Issuers.	To comply with the FSC’s amendments to “Regulations Governing Loaning of Funds and Making of Endorsements/ Guarantees by Public Companies”
Article 4 Limits on Endorsements and/or Guarantees 1~4. (Omitted)	Article 4 Limits on Endorsements and/or Guarantees 1~4. (Omitted) 5.“net worth”in these Procedures means the balance sheet equity attributable to the owners of the parent company under the Regulations Governing the Preparation of Financial Reports by Securities Issuers.	Same as above

Article 7 The Internal Control Procedure of the Company’s Subsidiaries 1~2. (Omitted)	Article 7 The Internal Control Procedure of the Company’s Subsidiaries 1~2. (Omitted) 3. In the case of a subsidiary with shares having no par value or a par value other than NT$10, the paid-in capital in the calculation under paragraph 1 of this Article shall be calculated based on the sum of the share capital plus paid- in capital in excess of par.	Same as above

Article 10 The Standards for Public Announcement 1. (Omitted) 2. Time Limits for and Contents of the Public Announcement In the event that the amount of endorsements and/or guarantees reaches the thresholds provided in the preceding Paragraph 1, the Company shall make a public announcement and report within two days after the occurrence of said endorsements and/or guarantees. (1)~(2) (Omitted)	Article 10 The Standards for Public Announcement 1. (Omitted) 2. Time Limits for and Contents of the Public Announcement In the event that the amount of endorsements and/or guarantees reaches the thresholds provided in the preceding Paragraph 1, the Company shall make a public announcement and report within two dayscommencing immediately from ~~after~~ thedate ofoccurrence of said endorsements and/or guarantees. (1)~(2) (Omitted) (3)“Date of occurrence”in these Procedures means the date of contract signing, date of payment, dates of boards of directors resolutions, or other date that can confrm the counterparty and monetary amount of the transaction, whichever date is earlier.	Same as above

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Article 13 1. The Company shall prepare a registry containing the subject of the endorsements/guarantees, the amount of the endorsements/ guarantees, the date of approval of the Board of Directors or the Company’s Chairman (as the case may be), the date of the endorsements/guarantees and all the evaluation issues according to these Procedures. 2. The internal audit personnel of the Company shall verify these Procedures and its implementation and make a report in writing for record. If there is any significant violation, the personnel shall inform the supervisors in writing.	Article 13 1. The Company shall prepare a registry containing the subject of the endorsements/guarantees, the amount of the endorsements/ guarantees, the date of approval of the Board of Directors or the Company’s Chairman (as the case may be), the date of the endorsements/guarantees and all the evaluation issues according to these Procedures. 2. The internal audit personnel of the Company shall verify these Procedures and its implementation and make a report in writing for record. If there is any significant violation, the personnel shall informaudit committee ~~the~~ ~~supervisors~~ in writing.	To consider Acer’s establishment of Audit Committee
Article 15 If the Company makes the endorsement and/or guarantee later becomes unqualifed under Article 2, or the endorsement and/or guarantee amount exceeds the limit under these Procedures due to the change of the calculation basis, the Company shall adopt plans and submit the plans to all the supervisors to discharge the endorsement and/or guarantee amount or the amount in excess within a designated period pursuant to relevant plan. The above timeframe shall be reported to the Board of Directors.	Article 15 If the Company makes the endorsement and/or guarantee later becomes unqualifed under Article 2, or the endorsement and/or guarantee amount exceeds the limit under these Procedures due to the change of the calculation basis, the Company shall adopt plans and submit the plans toaudit committee ~~all the supervisors~~ to discharge the endorsement and/or guarantee amount or the amount in excess within a designated period pursuant to relevant plan. The above timeframe shall be reported to the Board of Directors.	Same as above
Article 16 These Procedures, as well as any revision thereto, shall be approved by the resolution of the Board of Directors and sent to each supervisor and submitted to the shareholders meeting for approval.	Article 16 These Procedures, as well as any revision thereto, shall be approved bymore than half of all audit committee members and submitted to~~the resolution of~~ ~~t~~he Board of Directors for further approval,and~~sent to each supervisor~~ ~~and~~ ~~s~~ubmitted to the shareholders meeting for approval.If a director holds dissenting opinions of Company’s matters and there were records for it or in written stating, the Company shall submit materials of the director’s dissenting opinions to audit committee. If approval of more than half of all audit committee members as required in the preceding paragraph is not obtained, these Procedures may be implemented if approved by more than two- thirds of all directors, provided that the resolution of the audit committee is recorded in the minutes of the board of directors meeting. The terms“all audit committee members”in the preceding two paragraphs and“all directors”in the preceding paragraph shall be calculated as the actual number of persons currently holding those positions.	Same as above
	(Addition) Article 18 All endorsements and guarantees made by the Company shall comply with these Procedures. Matters not provided herein shall be governed by the relevant laws and regulations and the relevant regulations of the Company.	Renumbering of clause

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Article 18 Approved by General Shareholder’s Meeting held on January 15, 1993; (Omitted)	Article~~18~~ 19 Approved by General Shareholder’s Meeting held on January 15, 1993; (Omitted) The 9thamendment was made on June 18, 2014.	Addition of amendment date

D. Appendix Appendix 1

Acer Incorporated Regulations Governing Procedure for Board of Directors Meetings (English Translation)

Article 1

In order to establish a sound governance system, to promote the integrity of the supervising function and to strengthen the management power of the Company, these “Regulations Governing Procedure for Board of Directors Meetings” (these Regulations) are executed to be followed by the Company.

Article 2

The main agenda items, operational procedures, required content of meeting minutes, public announcements, and other compliance requirements for Board meetings of the Company shall be handled in accordance with these Regulations.

Article 3

The Board of Directors shall meet at least quarterly. The reasons for calling a Board meeting shall be notified to each director at least seven days in advance. In emergency circumstances, however, a Board meeting may be called on shorter notice. The notice of Board meeting in this Article may be sent via electronic means with respective Board member’s consent.

Article 4

A Board meeting shall be held at the location and during the business hours of the Company, or at a place and time convenient to all directors and suitable for holding such a meeting.

Article 5

The Board of Directors of the Company hereby appoints the “Secretary Office of the Board” (the “Secretary”) to be in charge of and handle the administrative affairs for the Board, including preparation of the Board meetings.
The Secretary shall prepare agenda items for the Board meetings and provide sufficient pre-meeting materials, to be sent together with the notice of the meeting.
The Secretary shall make appropriate and sufficient supplement at all time when requested by any one of the members of the Board with respect to any proposal, report, representation or other matters to be discussed by, reported to or presented before the Board meetings. By a resolution adopted by the Board, instituted by one member of the Board, for the cause of insufficiencies in the supporting documents and information pertaining to a proposal before the Board, the deliberation of s uch proposal may be deferred to the next Board meeting.

Article 6

Agenda items for Board meetings shall be in accordance with the applicable laws, regulations and the Company’s Articles of Incorporation; and agenda items for regular board of directors meetings shall include at least the following: 1. Reports:

(i) Minutes of the last meeting and actions arising.
(ii) Reporting on important financial and business matters.
(iii) Reporting on internal audit activities.
(iv) Other important matters to be reported.

Discussions:
(i) Items discussed and continued from the last meeting.
(ii) Items for discussion at this meeting.
Extraordinary motions.

Article 7

The Company shall submit the following items for discussion by the board of directors:
(1) Corporate business plan.
(2) Annual and semi-annual financial reports. However, half-year financial reports which are not required by law to be audited by accountants are excepted.
(3) Adoption or amendment of an internal control system pursuant to Article 14-1 of the Securities and Exchange Act.
(4) Adoption or amendment, pursuant to Article 36-1 of the Securities and Exchange Act, of handling procedures for financial or operational actions of material significance, such as acquisition or disposal of assets, derivatives trading, extension of monetary loans to others, and endorsements or guarantees for others.
(5) The offering, issuance, or private placement of any equity-type securities.
(6) The appointment or discharge of a financial, accounting, or internal audit officer.
(7) Donation to associated person or material donation to non-associated person; however, donations for charitable purposes in case of emergency arising from major natural disaster may be submitted for approval in the next Board meeting.
(8) Any matter required by Article 14-3 of the Securities and Exchange Act or any other law, regulation, or bylaw to be approved by resolution at a shareholders’ meeting or board of directors meeting, or any such significant matter as may be prescribed by the competent authority.
The “associated person” in paragraph (7) of the previous paragraph refers to the associated person as defined in the “Regulations Governing the Preparation of Financial Reports by Securities Issuers”. The material donation to non-associated person means donation on each account exceeding, or accumulated donation to one single person within one year exceeding, NT$100 million, or 1% of the net revenue or 5% of the paid-in capital in the latest audited financial reports.
The “one year” as set out in the previous paragraph means the one year period immediately preceding the date of the respective Board meeting; however, such one year period shall not apply to donation which has been approved by the Board.
The agenda items set out in the 1st paragraph shall be specified in the notice of the reasons for calling a Board meeting; none of them may be raised by an extraordinary motion except in the case of an emergency or legitimate reason.
Where there is an Independent Director appointed by the Company, the application of these Regulations shall be handled in accordance with the applicable laws and regulations when it is otherwise specified thereof; and each Independent Director shall attend in person any meeting concerning a matter that requires a resolution by the board of directors under Article 14-3 of the Securities and Exchange Act, or shall appoint another Independent Director to attend as his or her proxy. If an Independent Director objects to or expresses reservations about the matter, it shall be recorded in the board meeting minutes; an Independent Director intending to express objection or reservations but unable to attend the meeting in person shall, unless there is some legitimate reason to do otherwise, issue a written opinion in advance, which shall be recorded in the meeting minutes.

Article 8

Apart from matters referred to in paragraph 1 of the preceding article, which are required to be submitted for discussion by the board of directors, when the board of directors delegates any exercise of its powers pursuant to laws or regulations or the company’s articles of incorporation, matters such as the level and substance of the delegation shall be concretely and specifically set out.

Article 9

When a Board meeting is held, an attendance book shall be made ready for signature by directors attending the meeting and materials related to the Board meetings shall be made available for reference by the Secretary.
All Board directors shall attend Board meetings in person; if attendance in person is not possible, they may, in a manner compliant with the Company’s Articles of Incorporation, appoint another director to attend in their place. Attendance via tele- or video-conference is deemed as attendance in person.
A director appointing another director to attend a Board meeting in his or her place shall in each case give to that director a written proxy stating the scope of authorization with respect to the reasons for meeting.
A proxy under the preceding two paragraphs may accept a proxy from one person only.

Article 10

The Board meetings shall be called and chaired by the Chairman of the Board. However, the first meeting of each newly elected Board of Directors shall be called and chaired by the director who received votes representing the largest portion of voting rights at the shareholders’ meeting in which the directors were elected; if there are two or more directors so entitled to call the meeting, they shall choose one person by and from among themselves to do so.
When the Chairman of the Board is on leave or for any reason is unable to exercise the powers of the Chairman, a director designated by the Chairman shall do so in place of the Chairman, or, if there is no designated director, by a director elected by and from among themselves.

Article 11

When holding a Board meeting, the Company may, as necessary for the agenda items of the meeting, notify the staff from subsidiary(ies) to attend the meeting as nonvoting participants. When necessary, the Company may also invite certificated public accounts, attorneys, or other professionals to attend as nonvoting participants and give explanations. However, such nonvoting participants shall leave the Board meeting during discussion and voting process of the Board.

Article 12

When the time of a meeting has arrived and one-half all Board directors are not present, the meeting Chairman may announce postponement of the meeting time, provided that only two postponements, in combined total of not more than one hour, may be made. If the quorum is still not met after two such delays, the Chairman shall recall the meeting following the procedures provided in Article 3.
The term “all Board directors” as used in the preceding paragraph and in Article 17, paragraph 2, subparagraph (2) shall be calculated as the number of directors then in office.

Article 13

The proceedings of a Board meeting shall be conducted in a predetermined order of agenda items as stated in the meeting notice. However, the order may be changed with the approval of a majority of directors present at the meeting.
Before the predetermined agenda items under the preceding paragraph as well as extraordinary motions, the meeting Chairman may not declare the meeting closed unless with the approval of a majority of directors present at the meeting.
If at any time during the proceeding of a Board meeting the directors sitting at the meeting are not more than half of the directors present at the meeting, then upon motion by the directors sitting at the meeting, the Chairman shall declare a suspension of meeting, in which case the preceding article shall apply mutatis mutandis.

Article 14

When the Chairman at a Board meeting is of the opinion that a matter has been sufficiently discussed to a degree of putting to a vote, the Chairman may announce the discussion closed and bring the matter to vote.
Each director shall have one vote. The method of voting on matters at Board meetings will be designated by the Chairman. However, if directors sitting at the meeting disagree the designated method of voting, the Chairman shall inquire directors sitting at the meeting and designates the method of voting according to the majority opinion:

(1) to vote by a show of hands or to vote by voting implements.
(2) to vote by roll-call.
(3) to vote by a ballot.
(4) to vote by any other method.
When a matter comes to a vote at a Board meeting, if upon inquiry by the Chairman no director voices an objection, the matter is deemed approved, as if it has been approved by vote.
When necessary, persons for supervising the casting of votes and the counting for resolutions shall be designated by the Chairman, provided, however, that the person supervises the casting of vote shall be a director. The result of resolution(s) shall be announced in the meeting and recorded in the meeting minutes.

Article 15

Except as otherwise stated in the applicable laws and regulations, a resolution on a matter at a Board meeting requires the approval of a majority of the directors present at the meeting that shall be attended by a majority of all directors.
When the same resolutions have other revised or substituted resolution, the Chairman shall combine the revised or substituted resolution with the original one and decide the order to vote. If one of them has been resolved, other resolutions are deemed to vote and they are no needed to vote again.

Article 16

If a Board director or the juristic person which he/she represents has a personal interest in an agenda item, such director shall explain its key content in the respective Board meeting; if such personal interest is likely to prejudice the interest of the Company, such director is prohibited from participating in discussion of or voting on the relevant agenda item, and further, shall recuse himself/herself by leaving the meeting during discussion and voting on that item and may not act as another director’s proxy to exercise voting rights on that matter.
In passing a resolution at a Broad of Directors’ Meeting, where a Board director is prohibited by the preceding paragraph from exercising voting rights shall not be counted in the number of votes of directors present at the meeting.

Article 17

Minutes shall be prepared of the discussions at Board meetings; the meeting minutes shall record the following factually in accordance with the applicable laws and regulations:
(1) Session (or year), time, and place of meeting.
(2) Name of the meeting chair.
(3) Attendance of directors at the meeting, specifying the names and number of members present, excused, and absent.
(4) Names and titles of those attending the meeting as nonvoting participants.
(5) Name of minutes taker.
(6) Matters reported on.
(7) Agenda items: specify the resolution method and result for each proposal, the summary of the comments made by directors, experts, or any others at the meeting, and the name of, and explanation to the key content of the personal interest of, the director(s) with personal interest as provided in Article 16, paragraph 1 above, the reason for recusal or non-recusal of such director(s) and the execution thereof, and specify any objections or reservations expressed by directors, experts, or any others at the meeting that has been included in records or stated in writing, and any opinion issued in writing by an independent director under Article 7, paragraph 5.
(8) Extraordinary motions: specify the name of the mover, the resolution method and result for each motion, the summary of the comments made by directors, experts, or any others at the meeting, and the name of, and explanation to the key content of the personal interest of, the director(s) with personal interest as provided in Article 16, paragraph 1 above, the reason for recusal or non-recusal of such director(s) and the execution thereof, and specify any objections or reservations expressed by directors, experts, or any others at the meeting that has been included in records or stated in writing.

(9) Other matters required to be recorded.
In the event that the Company appoints independent directors or establishes an audit committee, any of the following matters in relation to a resolution passed at a Board meeting shall be stated in the meeting minutes and within two days of the meeting be published on an information reporting website designated by the competent authority:
(1) Any matter about which an independent director expresses an objection or reservation that has been included in records or stated in writing.
(2) Any matter adopted with the approval of two-thirds or more of all Board directors without having been passed by the audit committee.
The attendance book forms a part of the minutes for each Board meeting and shall be preserved permanently.
The minutes of a Board meeting shall bear the signature or seal of both the meeting Chairman and the minutes taker; a copy of the minutes shall be distributed to each director within 20 days after the meeting and well preserved as important company records during the existence of the Company.
The production and distribution of the meeting minutes may be done in electronic form.

Article 18

For the official record the Secretary shall take full record in either audio or video (with audio) formats of the entire proceedings, processes, and discussion of any and all Board meetings, and preserve and safe-keep such records, might be preserved in electronic forms, for at least five years.
If before the end of the preservation period referred to in the preceding paragraph a lawsuit arises with respect to a resolution of a Board meeting, the relevant audio or video recordings shall be preserved for a further period, in which case the preceding paragraph does not apply.
Where a Board meeting is held via tele- or video-conference, the audio or video recordings of the meeting form a part of the meeting minutes and shall be preserved permanently.

Article 19

The directors shall carry out fiduciary duty of loyalty as well as duty of due diligence; and shall, in compliance with the laws and the Incorporation, participate in the operations of the Board of Directors.

Article 20

These Regulations and amendments shall come into force after resolved by the Board of Directors.

Article 21

The Regulation was approved on December 29, 2006. The first amendment was approved on August 28, 2008.

The second amendment was approved on October 24, 2012.

The third amendment was approved on March 27, 2014, and come into force upon the expiration of current supervisors’ tenure in June, 2014.

Appendix 2 Acer Incorporated The Election Regulation of Directors and Supervisors (Before Amendments)

Article 1

Unless otherwise prescribed by the Company Law or the Company’s Articles of Incorporation, these Regulations shall govern the election of the Company’s directors and supervisors.

Article 2

Company’s directors and supervisors shall be elected from those shareholders who are of full legal capacity under the law.

Article 3

Company’s directors and supervisors shall be elected through cumulative voting.

Article 4

When electing the Company’s directors and supervisors, each share shall be entitled to one vote for each director or supervisor to be elected. The holder of the shares may cast all votes for one candidate, or may distribute the votes among several candidates.

Article 5

The candidates who receive the most votes for the position of director or supervisor position shall win the election, and such number shall be in compliance with the number of positions for director or supervisor provided for in the Articles of Incorporation. In the event two or more candidates receive the same number of votes beyond a quota, the winner shall be determined by drawing lots. One lot may be drawn by the chairman for each of the absentees.

Article 6

In the event a candidate is elected both director and supervisor for the same term, such candidate may choose either position but shall not accept both positions.

Article 7

The board of directors shall, upon preparing the ballots, have the ballots numbered in a series and enter the voting power on each ballot.

Article 8

During the election, the chairman shall appoint vote inspectors and vote counters from among the shareholders in attendance to take charge of inspecting and counting the votes.

Article 9

A ballot box shall be provided by the board of directors and shall be kept in public view by the monitor before the vote.

Article 10

Voters shall fill in candidate’s name and shareholder’s account number on the ballot, and if candidate is not a shareholder, the candidate’s ROC Identification Card Number (or for foreigner candidates, the candidate’s passport number); voters shall drop the ballots into the ballot box. In the event a legal entity is a candidate, both the full registered name of the legal entity and the name of its legal representative shall be entered on the ballot.

Article 11

A ballot shall be null and void if such ballot: 1. Is not dropped into the ballot box,

Is not on a ballot prepared by the Company,
Is not filled out by voter and is blank,
Contains the name of a candidate who is a shareholder, but his or her shareholder’s account number and the name under which the shares are registered, do not comply with the register of shares,
Contains any words or notations other than the candidate’s name or the shareholder’s account number,
Contains any alteration to the candidate’s name, shareholder’s account number, and voting power,
Contains words or marks which are illegible or unrecognizable, or
Contains the name of a candidate, but fails to list the shareholder’s account number, or his or her ROC Identification Card Number (or Passport Number) so as to identify such person.

Article 12

The vote inspector and vote counter shall monitor the opening of the ballots, and the chairman shall announce the results immediately thereafter.

Article 13

These Regulations and any amendments hereto shall enter into force when approved by a resolution at a Shareholders’ Meeting.

Article 14

These regulations were approved on February 17, 1993. The first amendment was approved on December 17, 2001. The second amendment was approved on June 19, 2002.

Appendix 3 Articles of Incorporation of Acer Incorporated (Before Amendments)

Chapter I – General Provisions

Article 1

This Company shall be incorporated in accordance with the Company Law, and shall be called Acer Incorporated.

Article 2

The business purposes of this Company shall include the following:

F113050 To engage in the wholesale purchase and sale of computer, office machinery and equipment.
F213030 To engage in the retail of computer, office machinery and equipment.
F118010 To engage in the wholesale purchase and sale of information software.
I301010 To provide information software services.
I301020 To provide information management services.
G902011 To engage in the second category of the telecommunications industry.
F401010 To conduct international trade.
JA02010 To repair electrical appliances and electrical products.
JE01010 To engage in leasing and renting industry.
CC01030 To manufacture electrical appliances and audiovisual electrical products.
CC01070 To manufacture wireless communication machinery & equipment.
CC01110 To manufacture computer and its peripheral equipment.
CD01060 To manufacture aircraft and its components.
E701030 To install telecommunications control equipment.
F401021 To import telecommunications control equipment.
F113070 To engage in the wholesale purchase and sale of telecommunications equipment.
IZ13010 To engage in on-line certification business.
F108031 To engage in wholesale of medical apparatus and instruments.
F208031 To engage in retail of medical apparatus and instruments.
ZZ99999 All business items that are not prohibited or restricted by law, except those that are subject to special approval.

Article 3

This Company may, for its business operations or other investment matters, make endorsements or issue guarantees.

Article 4

The total amount of investment made by this Company shall be exempt from the restriction under Article 13 of the Company Law.

Article 5

The headquarters of this Company shall be located in Taipei City, Taiwan, R.O.C. If the Company considers it necessary, it may, by a resolution adopted at a meeting by the board of directors, set up branch offices in Taiwan or abroad.

Chapter II – Capital Stock

Article 6

The total amount of this Company capital stock is NT$ thirty-five billion divided into 3.5 billion shares at par value of NT$10 per share, within which the board of directors is authorized to issue shares in installments. NT$ two and half billion of the aforesaid total capital stock, divided into 250 million shares each at a par value of NT$10, is reserved for exercising stock options.

Article 6-1

To issue employee stock options that the exercise price may be lower than the closing price of this Company stocks as of the issue date, this Company must have obtained 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 repurchase price, this 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 7

After approval for registration, the share certificates of this Company shall be issued in registered form, signed by, and affixed with the seals of, at least three directors of this Company, and authenticated by the competent registrar.

Article 8

All matters concerning shares shall be handled in accordance with the regulations of the competent authority except as otherwise provided by law.

Chapter III – Shareholders’ Meetings

Article 9

Shareholders’ meetings of this Company are classified into (1) regular meetings and (2) special meetings. The board of directors shall convene regular meetings within six months after the close of each fiscal year. Special meetings shall be convened, whenever deemed necessary in accordance with the law.

Article 10

Where a shareholder is unable to attend a meeting; such shareholder may appoint a proxy by using the proxy form provided by this Company, which shall specify the scope of proxy and be signed and sealed by the shareholder. Where one person has been appointed to act as proxy for more than two shareholders, unless such person is engaged in the trust business, the votes exercised by such person which exceeding three percent (3%) of all the issued and outstanding capital stock of this Company shall not be counted.

The above-mentioned proxies shall be delivered to this Company five (5) days before the shareholders’ meeting. In such a case, only the proxy received earlier shall be effective.

Article 11

Except as otherwise provided by the Company Law, a resolution may be adopted by the holders of a simple majority of the votes of the issued and outstanding capital stock represented at a shareholders’ meeting at which the holders of a majority of issued and outstanding capital stock are present.

Chapter IV – Directors and Committee

Article 12

This Company shall have nine (9) ~ eleven (11) directors, to be elected from the nominees listed in the roster of director with the candidate nomination system. The term of office for directors and supervisors shall be three (3) years. The directors are eligible for re-election. The total capital stock held by all directors shall not be less than the percentage provided by the competent authority. The Company may buy the Responsibility Insurance for the Directors who have to be responsible for the damages caused by their duties.

The Company shall establish three (3) or more independent directors to be included in the number of directors designated in the preceding paragraph. The elections for independent directors shall proceed with the candidate nomination system; the shareholders shall elect independent directors from among the nominees listed in the roster of independent director candidates.

Article 12-1

The Company shall establish an Audit Committee, which shall consist of all independent directors. The Audit Committee or the members of Audit Committee shall be responsible for those responsibilities of Supervisors specified under the ROC Company Law, Securities and Exchange Act and other relevant laws and regulations.

Article 13

The Board of Directors shall consist of directors of the company, and the chairman of the Board of Directors shall be elected by a majority of directors in attendance at a meeting attended by over two-thirds of the Board of Directors. The chairman of the Board of Directors shall represent this Company in external matters. The Board of Directors shall place any kinds of committee includes and so on.

The meeting of the Board of Directors shall be convened in accordance with Article 204 of the Company Law; the notice of the meeting may be made by electronic mail or facsimile transmission.

Article 14

The Board of Directors shall have the following authority:

To audit and supervise annual operation plan,
To determine the budget and review final accounts,
To propose earnings appropriation or make up for loss,
To propose increase or decrease capital plan,
To consider significant capital expenditure plans,
To establish branch offices or terminate branch offices,
To propose and discuss amendments to the Articles of Incorporation,
To decide important contracts or other important matters,
To decide whether to invest in other business or whether to dispose of shares of investment business,
To review the major dealings between the Company its related partners (including affiliated companies),
To appoint or remove the president and/or the vice president,
To dispose of or purchase important property and approve the bylaws, and
Other authorities granted by shareholders or in accordance with the law.

Article 15

Where the chairman of the board of directors is on leave or cannot exercise his powers or perform his duties for any reason, an acting chairman shall be designated in accordance with Article 208 of the Company Law. Where a director is unable to attend the meeting of the board of directors, he may appoint another director as his proxy to attend the meeting by issuing a letter of proxy. Each director can act as a proxy for only one other director.

Article 16

Unless otherwise provided for in the Company Law, resolutions of the board of directors shall be adopted by one-half of the directors at a meeting attended by one-half of the directors.

Article 16-1

The Board of Directors is authorized to determine the compensation recommended by the Remuneration Committee for the directors, taking into account the extent and value of the services provided for the management of the Corporation and the standards of the industry within the R.O.C. and overseas, no matter whether the Company has profit or suffered loss.

Where this Company has earnings, the remuneration of directors shall be distributed in accordance with Article 20 of these Articles of Incorporation.

Chapter V – Managers

Article 17

This Company may have one CEO, several presidents and vice presidents. The appointment, removal, and compensation of the president and vice presidents shall be made in accordance with Article 29 of the Company Law.

Chapter VI – Accounting

Article 18

At the end of each business fiscal year, the following reports shall be prepared by the board of directors, and shall be submitted to the shareholders’ meeting for approval:

Business Report;
Financial Report;
Proposal of Appropriation of Net Profit or the Covering of Losses.

Article 19

As the industry prosperity and the trends rapidly changed, the dividends strategy of the Company depends on yearly earnings and external environments, therefore, cash dividends of this Company shall be distributed at least ten percent of yearly dividends for complying with related regulations.

Article 20

Where this Company has earnings at the end of the fiscal year, after paying all relevant taxes, making up losses of previous year, this Company shall first set aside ten percent (10%) of said earnings as legal reserve, except that such legal reserve amounts to the total authorized capital. Thereafter, this Company shall set aside or reverse a special reserve in accordance with the applicable laws and regulations. Any balance left over shall be distributed as follows:

Over Five percent (5 %) for bonuses to employees. When the employee bonuses will be paid in the form of share bonuses, the employees entitled to such share bonuses may include employees of subsidiaries of this Company satisfying certain criteria. The criteria shall be formulated by the board of directors;
Not more than one percent (1%) for remuneration of directors, the standard for distribution of remuneration will be recommended by Remuneration Committee and determined by the Board of Directors;

The remainder together with previous year amount, after an amount is reserved for operation needs, shall be allocated to shareholders as bonuses. Except distribution of reserve in accordance with competent laws and regulations, the Company shall not pay dividends or bonuses when there is no profit.

Above distribution ratio may be adjusted upon the consent of shareholders meeting. Chapter VII – Supplementary Provisions

Chapter VII – Supplementary Provisions

Article 21

The Company Law and related regulations shall govern any matter not provided in the Articles of Incorporation.

Article 22

These Articles of Incorporation were approved on June 19, 1979. The first amendment was approved on December 17, 1980. The second amendment was approved on September 10, 1981. The third amendment was approved on August 10, 1983. The fourth amendment was approved on September 2, 1983. The fifth Amendment was approved on May 10, 1985. The sixth amendment was approved on August 1, 1985. The seventh amendment was approved on October 1, 1986. The eighth amendment was approved on April 2, 1987. The ninth amendment was approved on November 15, 1987.

The tenth amendment was approved on March 15, 1989. The eleventh amendment was approved on April 26, 1989. The twelfth amendment was approved on October 15, 1989. The thirteenth amendment was approved on November 22, 1989. The fourteenth amendment was approved on February 23, 1990. The fifteenth amendment was approved on May 15, 1990. The sixteenth amendment was approved on August 1, 1990. The seventeenth amendment was approved on December 27, 1990. The eighteenth amendment was approved on June 22, 1991. The nineteenth amendment was approved on December 10, 1991. The twentieth amendment was approved on June 10, 1992. The twenty-first amendment was approved on October 23, 1992. The twenty-second amendment was approved on February 17, 1993. The twenty-third amendment was approved on May 31, 1993. The twenty-fourth amendment was approved on March 24, 1994. The twenty-fifth amendment was approved on April 26, 1996. The twenty-sixth amendment was approved on April 26, 1996. The twenty-seventh amendment was approved on June 25, 1997. The twenty-eighth amendment was approved on May 29, 1998. The twenty-ninth amendment was approved on May 28, 1999. The thirtieth amendment was approved on May 23, 2000. The thirty-first amendment was approved on May 17, 2001.

The thirty-second amendment was approved on December 17, 2001. The thirty-third amendment was approved on June 19, 2002. The thirty-fourth amendment was approved on June 17, 2004. The thirty-fifth amendment was on June 14, 2005.

The thirty-sixth amendment was on June 15, 2006. The thirty-seventh amendment was on June 14, 2007. The thirty-eighth amendment was on June 13, 2008. The thirty-ninth amendment was on June 18, 2010. The fortieth amendment was on June 15, 2012.

The forty-first amendment was on June 19, 2013. These amendments to Acer’s Articles of Incorporation shall be enforced and applied from June 2014 of expiration of the term currently being served by the Board of Directors or Supervisors.

Appendix 4 Acer Incorporated Procedures for Acquiring or Disposing of Assets (Before Amendments)

Article 1 Purpose and Legal Basis

To enhance the management of the Company’s “Procedures of Acquiring or Disposing of Assets,” these Procedures are adopted and amended in accordance with the Securities and Exchange Law, “Regulations Governing the Acquisition and Disposal of Assets by Public Companies” and relevant laws and regulations.

Article 2

Scope of “assets” as used in these Procedures is as follows:

Investments in stocks, government bonds, corporate bonds, financial debentures, securities representing interest in a fund, depositary receipts, call (put) warrants, beneficial interest securities, and asset-backed securities, etc.
Real estate and other fixed assets.
Membership certificates.
Intangible assets, such as patent right, copyright, trademark right, franchise, etc.
Derivative products.
Assets acquired or disposed by mergers, splits, acquisition or share transfer in accordance with laws.
Other major assets.

Article 3 Definition

Terms used in these Procedures are defined as follows:

“Derivative Products”: means forward contracts, options contracts, futures contracts, leverage contracts, and 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, fulfillment contracts, after-sales service contracts, long-term leasing contracts and longterm purchase (sale) contracts.
“Assets Acquired or Disposed Through Mergers, Splits, Acquisitions or Share transfer Pursuant to Laws”: means assets acquired or disposed through mergers, splits, acquisitions in accordance with the Business Mergers and Acquisitions Act, Financial Holding Company Act, Financial Institution Merger Act and other acts or, or to share transfer from another company through issuance of the Company’s new shares as the consideration therefor (hereinafter “share transfer”) under six paragraph of Article 156 of the Company Act.
Related Party”: As used in these Procedures, means which is provided pursuant to No. 6 of the ROC Statements of Financial Accounting Standards promulgated by Accounting Research and Development Foundation of the Republic of China.
“Date of occurrence of the event”: means the date of contract signing, date of payment, date of consignment trading, date of transfer, date of resolution of Board of Directors, or other date which can confirm the counterparty and trading amount (whichever date is earlier); provided, for investment 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.
“Professional appraiser”: refers to a real property appraiser or other person duly authorized by an act of law to engage in the value appraisal of real property or other fixed assets.
“Subsidiary”: As defined in Statements of Financial Accounting Standards Nos. 5 and 7 published by Accounting Research and Development Foundation of the Republic of China.
“Mainland area investment”: refers to investments in China approved by the 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 4 Procedures of Evaluation and Operation for the Acquisition or Disposal of Assets

Acquisition or Disposal of Securities
(1) For securities acquired or disposed of in the centralized exchange market or OTC exchange, the operating department shall submit items such as the reasons for the proposed acquisition or disposal, targeted assets, and price reference, etc. to the in-charge department for the decision.
(2) For securities not acquired or disposed of in the centralized exchange market or OTC exchange, the operating department shall submit items such as the reasons for the proposed acquisition or disposal, targeted assets, counterparties, price of transfer, receipt and payment terms, and price reference, etc. to the in-charge department for the decision.
For acquisition or disposal of real estates, other fixed assets, membership certificates, intangible assets, and assets acquired or disposed of by mergers, splits, acquisition or share transfer in accordance with laws, the operating department shall submit items such as the reasons for the proposed acquisition or disposal, targeted assets, counterparties, price of transfer, receipt and payment terms, and price reference, etc. to the in-charge department for the decision.
For evaluation of derivative products, the finance manager shall hold periodic meetings with relevant persons examining operational strategies and performances. In principle, trading position and performances shall be reported to the chief treasury officer weekly, reported to the chief financial officer monthly and reported to the general manager quarterly.
Relevant operations for acquisition or disposal of assets shall be handled in accordance with the Company’s regulations relating to the internal control system.

Article 5 Procedures for Approval of Acquisition or Disposal of Assets

Methods and the Reference Basis for the Decision on Price
(1) For securities purchased and sold in the centralized exchange market or OTC exchange, the price shall be determined according to market price at the time of transaction. For securities not acquired or disposed of in the centralized exchange market or OTC exchange, the price shall be determined by reference to net worth per share, profitability, potential for future development, and then transaction price.
(2) The acquisition or disposal of real estate and other fixed assets shall be carried out by price comparison, price negotiation, or bidding. As to the price of real estate, it shall be determined by reference to the publicly announced current value, appraised current value, and actual transaction price in the vicinity.
(3) For acquisition or disposal of membership certificate, the price shall be comprehensively evaluated by reference to future anticipated added-value and produced benefit.
(4) For acquisition of disposal of intangible assets such as patent right, copyright, trademark right, and franchise, the price shall be determined by reference to elements such as future anticipated profit, levels of technology development and innovation, legal protected conditions, circumstances of license and implementation, production cost or implementation cost, in addition thereto, the relevant elements of right owners and licensees shall also be overall considered.
Amount and Level of License

In-charge department of the Company shall decide within its authority on the acquisition and disposal of assets in the following situations; provided, however, that matters governed by Article 185 of the Company Act shall be approved by the shareholders’ meeting in advance:

(1) Unless otherwise provided below, the acquisition or disposal of securities shall be approved by the Board of Directors before its execution:
(a) the Company’s Chairman is authorized by the Board of Directors to decide and execute project of which amount is within NT$50 million, and said matter is brought up to and ratified by the Board of Directors later.
(b) for acquisition or disposal of securities purchased and sold in the centralized exchange market or OTC exchange, the Company’s Chairman is authorized by the Board of Directors to decide and execute project of which amount is within NT$300 million, and said matter is brought up to and ratified by the Board of Directors later.
(c) the finance manager is authorized to execute short-term idle fund to invest in short-term securities such

as government bond, domestic bond fund, financial debentures, and US Treasury Bond with each single transaction or the daily total amount not exceeding NT$300 million; the approval of vice president of finance is required for amount between NT300 million to 500 million; the approval of the chief financial officer is required for amount between NT$500 million and NT1 billion; and the approval of the Company’s Chairman is required for amount exceeding NT$1 billion.

(2) The acquisition or disposal of real estate shall be approved by the Board of Directors before its execution, except that the Company’s Chairman is authorized by the Board of Directors to execute project of which the amount is less than NT$50 million and be brought up to and ratified by the Board of Directors later.
(3) The acquisition or disposal of other fixed assets shall be decided by the Company’s Chairman before its execution, except that the transaction of which the amount is above NT$50 million shall be approved by the Board of Directors.
(4) The license of acquisition or disposal of derivative products is enacted in accordance with the Company’s development of turnover and variation of risk position and shall be effective after the approval of the general manager and general chief financial officer and shall be filed with the Board of Directors. Any amendment thereto shall be approved by the Company’s Chairman before its execution. The contents of the license amount shall be provided in a separate letter.
(5) The acquisition or disposal of patent rights, copyrights, trademark rights, franchise rights, and other intangible assets shall be decided by the Company’s Chairman before its execution, except that the transaction of which the amount is above NT$300 million shall be approved by the Board of Directors.
Operating Department

Finance department is the operating department for securities and derivative product investments; the using department and relevant in-charge departments are the operating departments for investments in real estate, other fixed assets, intangible assets, membership certificate and assets acquired or disposed of through mergers, splits, acquisition or share transfer.

Article 6 The Standards for Public Announcement

For acquisition or disposal of the Company’s assets as provided below, the Company shall announce the same at the website designated by the Competent Authority in a form stipulated by the Competent Authority based on its nature, within two days commencing immediately from the date of occurrence of said matter:
(1) acquisition or disposal of real estate from related party; or the acquisition or disposal of other assets other than real estate from related party and the transaction amount reaches 20% of the Company’s paid-in capital, 10% of the Company’s total assets or NT$300 million or more; provided, however, that trading of government bonds or bonds under repurchase and resale agreements.
(2) proceeding mergers, splits, acquisition or share transfer.
(3) engaging in derivative products transactions and the loss reaching the maximum loss limit amount of the total or individual contract as provided in relevant procedures.
(4) asset transactions other than those provided in the preceding items (1), (2) and (3), or investment in Mainland China, the transaction amount reaches 20% of the Company’s paid-in capital or NT$300 million or more; provided, however, that the following situations are not applied:
- (a) purchase and sale of government bond.
- (b) trading of bonds under repurchase/resale agreements.
- (c) where the type of asset acquired or disposed is equipment/machinery for business use, the counterparty is not a related party, and the transaction amount is less than NT$500 million.
- (d) where land is acquired under an arrangement on engaging others to build on the company’s own land, engaging others to build on a leased 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 is less than NT$500 million.
The transaction amount in the preceding paragraph is calculated in accordance with the methods provided below:
(1) the amount of any individual transaction.
(2) the transaction amount accumulated within one year with the same counterparty in the acquisition or disposal of the targeted assets of the same type.

(3) the amount accumulated (the transaction amount for acquisition and disposal are separately accumulated) within one year in the acquisition or disposal of real estate within the same development project.
(4) the amount accumulated (the transaction amount for acquisition and disposal are separately accumulated) within one year in the acquisition or disposal of the same securities.

“Within one year” as used in this paragraph refers to the year preceding the date of occurrence of the current transaction. Items duly announced in accordance with these Procedures need not be counted toward the transaction amount.

The Company shall monthly report the transaction of the derivative products engaged by it and its subsidiaries not categorized as domestic public companies up to the end of the previous month by entering the information in the stipulated form to the website designated by the Competent Authority for filing of information before the 10th date of each month.
Where there is an error or omission in an item required to be announced according to regulations at the time of announcement and correction is required, all the items shall be again publicly announced and reported in their entirety.
Unless otherwise provided by other laws, the Company acquiring or disposing assets shall retain all relevant contracts, meeting minutes, registry, appraisal reports, and opinions of accountants, attorneys and security underwriters for at least 5 years.
After announcing and filing the transaction in accordance with these Procedures, the Company shall make a public announcement of relevant information in the website designated by the Competent Authority within two days commencing immediately from the date of occurrence of said matter:
(1) The executed relevant contracts of the original transaction have been changed, terminated or ceased.
(2) Mergers, splits, acquisition or share transfer have not been completed in the anticipated timeframe as provided in the contracts.
(3) Any change in the content of the original announcement and filing.

Article 7 Scope and Amount of Acquisition or Disposal of Assets

Apart from acquisition of assets for business use, the Company may invest or purchase real estate and securities for non-business use, the limitations on amounts are set forth as follows:
(1) Total investment in real estate for non-business use shall not exceed 40% of the summation of shareholder’s equity and long-term liabilities of the Company as certified by the accountant.
(2) Total investment in securities shall not exceed the shareholder’s equity of the Company as certified by the accountant.
(3) Investment in a single security shall not exceed 40% of the shareholder’s equity of the Company as certified by the accountant.
As to the Company and subsidiaries which the Company integrally holds more than (including) 50% shares, the limitations on amounts of acquisition or disposal of assets shall not violate rules provided herein below:
(1) shall not purchase real estate for non-business use.
(2) total investment in securities shall not exceed 40% of the shareholder’s equity of the Company as certified by the accountant.
(3) investment in a single security shall not exceed 20% of the shareholder’s equity of the Company as certified by the accountant.

Article 8 Control Procedures for Acquisition or Disposal of Assets of the Company’s Subsidiaries

For the acquisition or disposal of assets by subsidiaries invested by the Company, either one of the following shall be processed in advance:
(1) The acquisition or disposal shall be approved and executed by the Company’s Board of Director and relevant departments of the Company in accordance with these Procedures, and the Company’s subsidiaries shall cooperate to handle relevant matters; or
(2) the subsidiaries’ “Procedures for Acquiring or Disposing of Assets” shall be enacted and executed in accordance with regulations; and filed with the Company’s Board of Director for approval. Any amendment thereto shall be subject to the same procedures.

Where subsidiaries of the Company not categorized as domestic public companies whose acquisition or disposal of assets reach the thresholds of public announcement under these Procedures, the Company shall also make a public announcement with copies to relevant competent authorities in accordance with these Procedures.
The paid-in capital or total assets of the Company shall be the standard for determining whether or not a subsidiary under the preceding paragraph is subject to Paragraph 1 of Article 6 (in the event the type of transaction reaches 20% of paid-in capital or 10% of total assets).

Article 9 Punishment of Violation of the Procedure

If relevant employees and personnel of the Company violate these Procedures, they will be subject to Articles 37 and 38 of the Company’s “Personnel Administration Regulations”.

Article 10 Appraisal Report of Professional Appraisal Institutions

In acquiring or disposing of real estates or other fixed assets, where the transaction amount reaches 20% of the company’s paid-in capital or NT$300 million or more, the Company, unless otherwise transacted with a government agency, engaging others to build on its own land, engaging others to build on leased land, or acquiring or disposing of machines and equipment for business use, the Company shall obtain an appraisal report prior to the date of occurrence of the event from a professional appraisal institution and shall further comply with the following provisions:

Where due to special circumstances it is necessary to give a limited price, specified price, or special price as a reference basis for the transaction price, the transaction shall be submitted to the Board of Directors for approval in advance. The same procedure shall be followed for any future changes to the terms and conditions of the transaction.
Where the transaction amount is 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 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 CPA shall be engaged to 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 institution and execution date of the contract; provided, however, 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.

Article 11 Certified Public Accountant’s Opinions

The Company acquiring or disposing of securities shall, prior to the date of occurrence of the event, obtain financial statements of the issuing company for the most recent period, certified or reviewed by a certified public accountant, for reference in appraising the transaction price, and if the transaction amount reaches 20% of the Company’s paid-in capital or NT$300 million or more, a certified public accountant shall be retained prior to the date of occurrence of the event to provide an opinion regarding the reasonableness of the transaction price. If the CPA needs to use the report of an expert as evidence, the CPA shall do so in accordance with the provisions of Statement of Auditing Standards No. 20 published by Accounting Research and Development Foundation. This requirement does not apply, however, to publicly quoted prices of securities that have an active market, or where otherwise provided by regulations of the Competent Authority.
In acquiring or disposing membership certificate or intangible assets and the transaction amount reaches 20% of the Company’s paid-in capital or NT$300 million or more, 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 Accounting Research and Development Foundation.

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 opinion.

Article 11-1

In addition that handling of the acquisition or disposal of assets between the Company and related party shall proceed with relevant approval procedures and evaluate the reasonableness of terms of the transaction in accordance with these Procedures, where the transaction amount reaches 10% of the Company’s total assets or more, appraisal report or CPA’s opinion shall also be required in accordance with Articles 10 through the preceding Article.

When judging whether counterparty is a related party, in addition to legal formalities, the substance of the relationship shall also be considered.

Article 11-2

The transaction amount in the preceding three Articles are calculated in accordance to Paragraph 2 of Article 6; “within one year” as used refers to the year preceding the date of occurrence of the current transaction. Items duly obtained appraisal report or accountant opinion in accordance with these Procedures need not be counted toward the transaction amount.

Article 12

The acquisition or disposal of real estate from related parties, or the acquisition or disposal of other assets other than real estate from related party, and the transaction amount reaches 20% of the Company’s paid-in capital, 10% of the Company’s total assets or NT$300 million or more; provided, the Company shall submit information provided below to Board of Directors for approval and to supervisors for recognition before signing the contracts and payments: 1. the purpose, necessity and the anticipated benefit of the acquisition or disposal of assets.

reasons for choosing the related party as a trading counterparty.
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 Articles 13 and 14.
the date and price at which the related party originally acquired the real property, the original trading counterparty, and that trading counterparty’s relationship to the Company and the related party.
monthly cash flow forecasts for the year commencing from the anticipated month of signing of the contract, and evaluation of the necessity of the transaction, and reasonableness of the funds utilization.
An appraisal report from a professional appraiser or a CPA’s opinion obtained in accordance with these Procedures.
Restrictive covenants and other important stipulations associated with the transaction.

The transaction amount in the preceding paragraph is calculated in accordance with Paragraph 2 of Article 6; “within one year” as used in these Procedures refers to the year preceding the date of occurrence of the current transaction. Items duly approved by the Board of Directors and recognized by supervisors in accordance with these Procedures need not be counted toward the transaction amount.

Article 13

The Company purchases real estate from a related party shall comply with methods provided below to evaluate the reasonableness of the transaction cost:

Based on the transaction price of the related party plus necessary interest on funding and the cost to be borne by the buyer according to law. “Necessary interest on funding” shall be imputed based on the weighted average interest rate of the funding borrowed by the Company in the year of purchase of the asset.
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; provided, however, that 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 1 year or more. However, this shall not apply where the financial institution is a related party of one of the trading counterparties.
Where both the land and building on the property in question are purchased in one transaction, the cost of the transaction may be reached by respectively evaluating such land and building based on either of the methods described above.

The Company acquires real property from a related party and appraises the cost of the real property in accordance with the preceding Paragraphs 1, 2 and 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 Article 12 and the preceding four paragraphs do not apply:
(1) the related party acquires real estate through inheritance or as a gift.
(2) more than 5 years will have elapsed from the time the related party signed the contract to obtain the real property to the signing date for the current transaction.
(3) the real property is acquired through signing of a joint development contract with the related party.

Article 14

When the results evaluated by the Company in accordance with paragraphs 1, 2 and 3 of the preceding Article are all lower than the transaction price, the matter shall be handled in accordance with Article 15; provided, 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 have been obtained, this restriction shall not apply:

Where the related party acquired undeveloped land or leased land for development, it may submit proof of compliance with one of the following conditions:
(1) Where undeveloped land is appraised in accordance with the means in the preceding Article, and buildings 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 3 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.
(2) 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.
(3) Completed leasing transactions by unrelated parties for other floors of the same property 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.
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.

Completed transactions for neighboring or closely valued parcels of land in the preceding paragraph 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; transaction 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.

Article 15

Where the Company acquires real property from a related party and the results of appraisals conducted in accordance with Articles 13 and 14 are all lower than the transaction price, the following steps shall be done:

a special reserve shall be set aside against the difference between the real property transaction price and the appraised cost.
the supervisors handling the matter pursuant to Article 218 of the Company Act.
actions taken pursuant to the preceding subparagraphs 1 and 2 shall be reported to a shareholders meeting, and the details of the transaction shall be disclosed in the annual report and prospectus.

After setting aside a special reserve pursuant to the preceding paragraph, the Company 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, or the assets have been disposed of, 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 Competent Authority has given its consent.

Transaction of Derivative Products

Article 16

The Company engages in transactions of derivative products shall pay strict attention to control of the following important risk management and auditing matters, and incorporate them into their Procedures:

Trading principles and strategies: shall include the types of derivatives that may be traded, operating or hedging strategies, segregation of duties, essentials of performance evaluation, total amount of derivatives contracts that may be traded, and the maximum loss limit on total trading and for individual contracts.
Risk management measures.
Internal auditing system.
Regular evaluation methods and the handling of irregular circumstances.

Article 17

The Company engaging in derivatives trading shall adopt the following risk management measures:

The scope of risk management shall include the risk management of credit, market price, liquidity, cash flows, operation and legal risks.
Personnel engaged in derivatives trading may not serve concurrently in other operations such as confirmation and settlement.
Risk measurement, monitoring, and control personnel shall be assigned to a different department that the personnel in the preceding subparagraph and shall report to the Board of Directors or high-level managers with no responsibility for trading or position decision-making.
Derivatives trading positions held shall be evaluated at least once per week; however, positions for hedge trades required by business shall be evaluated at least twice per month. Evaluation reports shall be submitted to highlevel managers authorized by the Board of Directors.
Other important risk management measures.

Article 18

Principles of Supervision and Management of the Board of Directors:

Assign high-level managers to pay continuous attention to monitoring and controlling derivatives trading risk.
Periodically evaluate whether derivatives trading performance is consistent with established operational strategy and whether the risk undertaken is within the Company’s permitted scope of tolerance.

The Principles of Supervision and Control of the High-Level Managers Authorized by the Board of Directors:

Periodically evaluate the risk management measures currently employed are appropriate and are faithfully conducted in accordance with these Procedures and the “Rules to Engage in the Transaction of Derivative Products” stipulated by the Company.
When irregular circumstances are found in the course of supervising trading and profit-loss circumstances, appropriate measures shall be adopted and a report immediately made to the Board of Directors; where the Company has independent directors, an independent director shall be present at the meeting and express an opinion.

The Company shall report to the Board of Directors after it authorizes the relevant personnel to handle derivative trading in accordance with its Procedures for Engaging in Derivatives Trading.

Article 19

The Company shall establish a log book in which details of the types and amounts of derivatives trading engaged in, Board of Directors approval dates, and the matters required to be carefully evaluated under Subparagraph 4 of Article 17, Subparagraph 2 of Paragraph 1 and Subparagraph 1 of Paragraph 2 of Article 18 shall be recorded in detail.

The Company’s internal auditors shall periodically check the suitability of internal controls on derivative transactions and conduct a monthly audit of compliance of the trading departments with the Procedures to Engage in the Transaction of Derivative Products, and prepare an audit report. If any material violation is discovered, each supervisor shall be notified in writing.

Mergers, Splits, Acquisitions and Share Transfer among Enterprises

Article 20

Before convening the meeting for the Board of Directors for a resolution, the Company engaging in a merger, split,

acquisition or share transfer shall retain accountants, attorneys or securities underwriters to provide opinions on the reasonableness of the share conversion rates, acquisition price or the cash or other assets distributed to shareholders, and submit the opinions to the Board of Directors to discuss for approval.

Article 21

Prior to convening the shareholders’ meeting, the Company participating in a merger, split or acquisition shall prepare a public report to shareholders detailing important contractual content and matters relating to the merger, demerger, or acquisition and include it along with the expert opinion referred to in the preceding Article when sending shareholders notification of the shareholders meeting for reference in deciding whether to approve the merger, demerger, or acquisition. Provided, however, where another act exempts the Company from convening a shareholders meeting to approve the merger, demerger, or acquisition, this restriction shall not apply.

If the shareholders’ meeting of any company (including the Company) participating in the merger, split or acquisition fails to convene or pass a resolution due to lack of a quorum, insufficient votes, or other legal restriction, or the proposal is rejected by the shareholders meeting, the Company shall immediately make a public announcement explaining the reasons for such occurrence, the follow-up measures to be taken, and the anticipated date for convening of the next shareholders’ meeting(s).

Article 22

Unless otherwise provided by other laws or the Competent Authority is notified in advance of extraordinary circumstances and grants consent, the Company shall convene the board meetings and shareholders’ meetings and pass resolutions regarding merger, split or acquisition and relevant matters on the same day with companies participating in a merger, split, acquisition or share transfer.

When participating in a merger, split, acquisition, or transfer of another company’s shares, the Company shall prepare a full written record of the information requested by the Competent Authority and retain it for reference. When participating in a merger, split, acquisition, or transfer of another company’s shares, the Company shall, within 2 days commencing immediately from the date of passage of a resolution by the Board of Directors, report (in the prescribed format and via the Internet-based information system) the information requested by the Competent Authority for recordation.

Where any of the companies participating in a merger, split, 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 the latter is required to abide by Paragraphs 2 and 3 of Article 22.

Article 23

All persons participating in or knowing of plan of the Company’s merger, split, acquisition or share transfer shall issue a written undertaking of nondisclosure, 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 share transfer.

Article 24

In the Company’s participating in a merger, split, acquisition or share transfer, the share conversion rates or the acquisition price may not be arbitrarily changed unless under the following circumstances, and conditions for change shall be provided in the merger, split, acquisition or share transfer contract:

Cash capital increase, issuance of convertible corporate bonds, distribution of stock dividends, issuance of corporate bonds with warrants, preferred shares with warrants, stock warrants, or other equity based securities.
Acts affecting the Company’s finances or operations, such as disposal of major assets.
Occurrence of major disasters, major technological transformations, or other events affecting the Company’s shareholders’ equity or the Company’s securities prices.
An adjustment where any of the companies participating in the merger, demerger, acquisition, or transfer of shares from another company, buys back treasury stock according to laws.
Increase, decrease, or change in the entities, or number thereof, participating in the merger, split, acquisition or share transfer.
Other conditions for change have been provided in the contract and publicly disclosed.

Article 25

In the Company’s participation in a merger, split, acquisition or share transfer, the contract shall specify the rights and obligations of the companies participating in the merger, split, acquisition or share transfer and shall also specify the following particulars:

Handling of breach of agreement.
Principles for the handling of equity-type securities previously issued or treasury stock previously bought back by any company that is extinguished in a merger or that is demerged.
The amount of treasury stock 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.
The manner of handling changes in the number of participating entities or companies.
The scheduled timetable for execution of the plan, and scheduled timeframe for completion.
The relevant procedures for handling failure to complete within such timeframe, such as the anticipated date for convening of the shareholders’ meeting(s) pursuant to laws.

Article 26

Following public disclosure of information about the Company’s participating in merger, split, acquisition or share transfer, if the Company has an intention to undertake a further merger, split, acquisition or share transfer with another company, any procedures or legal actions already carried out by the Company under the original merger, split, acquisition or share transfer plan shall be carried out anew except conditions that the number of the participating companies decreases and the companies’ shareholders’ meeting has made a resolution and authorized the Board of Directors the right for modification, the Company is exempt from convening the shareholders’ meeting for another resolution.

Article 27

If the companies participating in the merger, split, acquisition or share transfer are categorized as non-public companies, the Company shall enter into an agreement with them whereby the latter is required to abide by Articles 22, 23 and 26.

Article 28 Others

Matters not provided herein shall be governed by the relevant laws and regulations and relevant internal rules of the Company. If the Procedures of Acquisition or Disposal of Assets in the original ruling is amended by the competent authority, the Company shall apply the provisions in the new ruling.
These Procedures shall be approved by the Board of Directors, submitted to each supervisor and reported to the shareholders’ meeting for approval. The same procedures shall apply with any amendment hereto. If a director holds dissenting opinions of Company’s matters and there were records for it or in written stating, the Company shall submit materials of the director’s dissenting opinions to the each supervisor.
For the Company’s matters which shall be approved by the Board of Directors pursuant to these Procedures or other laws, where a director holds dissenting opinions on the Company’s matters and there were relevant records or made in writing, the Company shall submit materials of the director’s dissenting opinions to each supervisor.
When the Company reports the transaction of acquisition or disposal of assets pursuant to the preceding two paragraphs to the Board of Directors for discussion, in case the position of independent director is established in accordance with the law, the Board of Directors shall fully take each independent director’s opinions into consideration. If an independent director objects to or expresses reservations about any matter, it shall be recorded in the minutes of the board of directors meeting.
Where an audit committee is established in accordance with the law, these Procedures shall be adopted or amended by more than half of all audit committee members’ approval and submitted to the board of directors for a resolution.
If approval of more than half of all audit committee members as required in Paragraph 2 is not obtained, these Procedures may be implemented if approved by more than two-thirds of all directors, and the resolution of the audit committee shall be recorded in the minutes of the board of directors meeting.
The terms “all audit committee members” in these Procedures and “all directors” in paragraph 5 shall be calculated as the actual number of persons currently holding those positions.
Where an audit committee is established in accordance with the law, the provisions set out in Subparagraph 2 of Paragraph 1 of Article 15 shall apply mutatis mutandis to the independent director as the member of audit committee; and the other the provisions regarding supervisors shall apply mutatis mutandis to the audit committee.

Another stricter management principles may be drafted by the Company’s Chairman in accordance with these Procedures and be effective after approval by the Board of Directors with two-thirds vote at a meeting attended by more than two-thirds of the directors. The same procedure shall apply to any amendment thereto.
Where foreign company’s share is no-par stock or its par value per share is not the NT$10, the transaction amount calculation related to 20% of the paid-in capital under Article 6, 8 and Article 10 to Article 12 shall be calculated by 10% of shareholders’ equity.

Article 29

The Procedures were enacted on July 28, 1995. The first amendment was made on October 27, 1995. The second amendment was made on November 18, 1999. The third amendment was made on June 11, 2003. The fourth amendment was made on June 13, 2008. The fifth amendment was made on June 15, 2012.

Appendix 5

Foreign Exchange Risk Management Policy and Guidelines (Before Amendments)

1. Purpose

To manage foreign currency receivable, payable, asset & liability; to hedge the risk due to FX fluctuation; and to achieve the target of no exchange gain & loss fluctuation.

2. Scope

2-1 Acer Inc.

2-2 Subsidiary (100% owned by Acer Inc.)

3. Policy Statement

3-1 Principal and Guideline

3-1-1 Products ：

The products limit to Spot, Forward, Option and FX Swap. Any exception needs the approval from BOD.

3-1-2 Strategy ：

For hedge purpose only, no speculation is allowed.

3-1-3 Responsibility ：

3-1-3-1 Business ： Exposure forecast.

3-1-3-2 Finance ： Market update 、 judgment for FX trend & risk, FX product knowledge, regulations, exposure, confirmation, reports, and information providing.

3-1-4 Amount ：

The hedge amount cannot exceed the net exposure of outstanding asset & liability plus the exposure for coming twelve months forecast. Any hedge amount exceeds six months forecast shall be approved by President and CFO. Any hedge amount exceeds twelve months forecast for special requirement shall be approved by President and CFO, and report to Chairman.

3-1-5 Loss Limit ：

The losses limit authorization table of FX deals on aggregate and individual contract was set up according to the exposure.

cording to the exposure.
Authorization	Losses limit % on aggregate or individual contract
Chairman	20%
President	15%
CFO	10%
Head of Treasury Dept.	5%

If the loss amount reaches the above limit, the person with authority should be reported promptly and the authorized manager should give competent instruction; if the loss amount reach 25% and company should publicly announce by regulations and submit the relevant information to each supervisor and Board of Director.

3-2 Procedure

3-2-1 Authorization ：

The authorization table was set up and approved by President and CFO, according to the turnover growth and the exposure changes as Attachment One to manage the FX hedge, handled set forth in Article 3-7 and so shall any revisions made.

3-2-2 Execution ：

The trading and risk management require professional knowledge so it should be responsible by Treasury Department - Risk Management Team.

3-3 Declaration Procedure (Taiwan Stock Exchange Commission)
3-3-1 For declaration, each subsidiary should submit previous monthend all FX contract details to HQ by the third business day of each month.

3-3-2 For declaration, HQ sh ould collect, verify and submit the details of all to Shareholders Service Office.

3-3-3 Shareholders Service Office should disclose those details by the tenth day of each month.

3-4 Accounting Policy

The accounting policy is based on the current financial accounting standard and regulation. The Company also provides necessary reports periodically and calculates realized and unrealized profit or loss for management’s review.

3-5 Internal Control

3-5-1 Risk Management

Dealing counterparties are limited to those banks that are selected after risk evaluation. The approval of CFO is required for amendment.
3-5-2 Internal Control
、
3-5-2-1 The persons in charge of dealing settlement and confirmation should be different.
3-5-2-2 The dealing person (Treasury – Risk Management team ) should submit the FX slip and contract to the person in charge of confirmation (Accounting Dept.) for record.
3-5-2-3 The person in charge of confirmation should check the details with counterparty banks periodically.

3-5-3 Evaluation

  - CFO should review the strategy and performance with relevant persons periodically. The hedge status and performance should be submitted to Head of Treasury Department weekly, and to CFO monthly and to President quarterly.

3-6 Audit
Internal auditors should understand the appropriateness of the internal control, investigate whether the dealing procedure follow the “Procedures of acquiring or disposing of assets” or not and generate the auditing report. The report in writing should be submitted to each supervisor if any violation.
3-7 The Policy and amendments shall come into force after resolved by the Board of Directors, be submitted to each supervisor and upon the consent of shareholders meeting.
3-8 The Policy was enacted on March 26, 2003.
The 1st amendment was made on June 13, 2008

Acer Inc.

The Authorization Table

(Attachment One)

This authorization table was set up according to Article 3-2-1 of “Foreign Exchange Risk Management Policy and Guidelines”.

1. FX Authorization:

X Authorization:
Chairman President CFO Head of Treasury Dept.	Daily Amount
	above USD400,000,000 USD400,000,000 USD250,000,000 USD150,000,000

The daily transaction amount should be approved by the person with authority. The transaction in the currency other than USD should be converted to USD and still follow the above table.

2. Others

The products limit to Spot, Forward , Option & FX Swap. Any exception needs the approval from BOD.

Appendix 6 Acer Incorporated Procedures Governing Lending of Capital to Others (Before Amendments)

All loans made by the Company shall comply with these Procedures. Matters not provided herein shall be governed by the relevant laws and regulations and the relevant regulations of the Company.

Article 1 Applicability

The Company shall not provide loans to others unless otherwise provided below:

The Company may provide loans to enterprises with which the Company has business relationship; where there is necessity of short-term financing, the Company may provide loans in accordance with these Procedures to subsidiaries in which the Company holds 50% or more of its total outstanding common shares, or enterprises in which the Company proposes to make equity investment.

Article 2 The Standard for Lending Assessment

For enterprises having business relationship with the Company apply funding from the Company, the aggregate amount of the loans provided by the Company shall not exceed the net worth of total trading amount between both parties in the most recent year. The net worth of total trading amount between both parties means the total amount of purchase or re-sale, whichever is higher.
For enterprises apply funding from the Company by reason of necessity to have short-term funding, those enterprises shall be limited to subsidiaries in which the Company holds 50% or more of its total outstanding common shares or enterprises in which the Company proposes to make equity investment.

Article 3 Limits on Loan

The aggregate amount of loans provided by the Company shall not exceed 50% of the net worth of the Company as shown in the latest financial report audited or reviewed by the CPA. Out of the aforesaid amount, the aggregate amount of loans for necessity of short-term funding shall not exceed 20% of the net worth of the Company as shown in the latest financial report audited or reviewed by the CPA.
By reason of business relations, the limits to lend to each single borrower shall be subject to the percentage provided below:
(1) For subsidiary that the Company holds 50% or more of its total outstanding common shares, the aggregate amount of loans shall not exceed 10% of the net worth of the Company.
(2) For enterprise that the Company holds less than 50% of its total outstanding common shares, the aggregate amount of loans shall not exceed 5% of the net worth of the Company, nor exceed 40% of the net worth of the enterprise.
(3) For other borrower, the aggregate amount of loans shall not exceed 3% of the net worth of the Company, nor exceed 25% of the net worth of the borrower.
By reason of necessity to have short-term funding from the Company, the limits to loan to each single borrower shall be subject to the percentage provided below:
(1) For subsidiary that the Company holds 50% or more of its total outstanding common shares, the aggregate amount of loans shall not exceed 10% of the net worth of the Company.
(2) For enterprise that the Company holds less than 50% of its total outstanding common shares, the aggregate amount of loans shall not exceed 5% of the net worth of the Company, nor exceed 40% of the net worth of the enterprise.
(3) For other borrower, the aggregate amount of loans shall not exceed 3% of the net worth of the Company, nor exceed 25% of the net worth of the borrower.

In the event the Company provides loans to enterprise in which the Company proposes to make equity investment and there is necessity of short-term funding, each application shall be submitted to the Board of Directors for approval and the aggregate amount shall not exceed the aforesaid limits.

Article 4 Time Limits and Interest Rates

When a borrower gets a loan from the Company, the loan period shall not exceed one year. The Chairman of the board is authorized to decide the method for calculating interest.

Article 5 Procedures for Lending

The borrower shall apply in writing to the finance department of the Company for financing by submitting its Certificate of Profit Seeking Enterprise, relevant certificates of the enterprise, a photocopy of the identification of the enterprise’s representative, and other required financial information. The finance department shall make a credit investigation and submit the application to the Board of Directors for approval.
After the amount of loan has been approved, the borrower shall fill out a payment application form and submit to the finance department to withdraw the fund.
Where funds are loaned between the Company and its subsidiaries or between the Company’s subsidiaries, the Board of Directors of the lender may authorize the Company’s Chairman to appropriate funds in installments or as revolving funds to the same borrower within a specified amount approved by the Board of Directors and within one-year period. Except as funds are loaned in accordance with Clause 3 of Article 10, a loan amount for each enterprise shall not exceed ten (10%) percent of net worth of the borrower as shown in its latest financial report.

Article 6 Review Procedures for Lending

When a borrower applies for a loan from the Company, the borrower shall specify the purpose and the necessity of the loan and the finance department shall decide whether to accept the application or not.
The finance department shall truly proceed with credit check on borrower’s business operation situation. The personnel in charge shall prepare a report including credit check result, opinion and devise the criterion of the loan for cases with good credit reputation and justifiable purposes and then submit the same to the Board of Directors for approval.
In addition to credit check on the borrower, the finance department shall make an assessment of impact on operation risk, financial condition and shareholder’s rights that may result from said provision of loan, and submit its opinion statement together with credit check report to the Board of Directors for approval.
When the borrower applies for withdrawing the funding from the Company, the borrower shall provide the Company with the Banker’s acceptance or collateral of the same amount as security. The finance department shall evaluate and determine the value of the collateral.

Article 7 The Standards for Public Announcement

The Company shall enter the information regarding the loan amount provided by the Company and its subsidiaries in the most recent month into the Market Observation Post System on or before the 10th date of each month.
In the event that the loan amount provided by the Company and its subsidiaries reaches the following thresholds, the Company shall make a public announcement within two days after the occurrence of said lending:
(1) The aggregate amount of loans reaches twenty percent (20%) or more of the Company’s net worth as shown in its latest financial report audited or reviewed by the CPA.
(2) The aggregate amount of loan for any single enterprise reaches ten (10%) percent or more of the Company’s net worth as shown in its latest financial report audited or reviewed by the CPA.
(3) The aggregate amount of new loans reaches NT$10 million and reaches two percent (2%) or more of the Company’s net worth as shown in its latest financial report.
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 the preceding paragraph.

Article 8 Subsequent Measures for Control and Management of Loans, and Procedures for Handling Delinquent Claims

The finance department of the Company shall prepare a registry containing the basic information of the borrower, the date and amount for Board of Directors’ approval, the date of lending, the aggregate amount of loan, the content of the collateral, interest rate, the method and date for discharging the loan for verification conducted by the competent authorities and relevant personnel.

After providing of loans, the finance department shall closely observe the borrower and its guarantor’s financial, business and credit condition and if the loan is secured by collateral, the finance department shall pay attention to the collateral’s value variation. If there is any significant change, the finance department shall notify the Company’s Chairman and adopt proper steps to handle as instructed by the Company’s Chairman.
When the borrower would like to repay its loan on or before expiration date, the interest payable shall be calculated first, and the Banker’s acceptance shall not be returned nor collateral registration shall be cancelled until said interest plus the principal are repaid to the Company by the borrower.
The borrower shall repay the loan including the principle and interest upon expiration date. If the borrower fails to repay the loan upon expiration date and needs to file for extension, the borrower shall file a written application with the Board of Directors for approval in advance. The borrower is only allowed to file for extension twice for the same loan and the extension period cannot exceed three (3) months each time within the time limit provided in Article 4. In the event the borrower violates these Procedures, the Company may institute a legal action against the guarantor or dispose of the collateral pursuant to laws.

Article 9 Punishment of Violation of These Procedures

If relevant employees and personnel of the Company violate these Procedures, they will be subject to Articles 37 and 38 of the Company’s “Personnel Administration Regulations”.

Article 10 Control Procedures for the Company’s Subsidiaries

When the subsidiaries over which the Company has control propose to provide loans to others, the subsidiaries shall enact the “Procedures Governing Lending of Capital” and file with the Company’s Board of Directors for ratification. The said procedures of the subsidiaries shall be stipulated in accordance with these Procedures; provided, however, that the aggregate loan amount of the subsidiaries and the aggregate loan amount for each enterprise shall not exceed the following thresholds:

For the subsidiaries in which the Company directly or indirectly holds 100% of its total outstanding common shares, the aggregate loan amount and the aggregate loan amount for each enterprise shall be calculated based on the net worth of such subsidiary and its Procedures; provided, however, that if Clause 3 of this Article applies, the aforementioned threshold shall be calculated based on the Company’s net worth instead.
For the subsidiaries in which the Company did not directly or indirectly holds 100% of its total outstanding common shares, the aggregate loan amount and the aggregate loan amount for each enterprise shall be calculated based on the net worth of the subsidiaries and its Procedures.
Where funds are loaned between the overseas companies in which the Company directly and indirectly holds 100% voting shares or capital, such funds may be loaned free of the limitation of the aggregate amount of shortterm funding provided in Paragraph 1 of Article 3, the limits to each borrower provided in Paragraph 3 (1) of Article 3 and Article 4; provided, however, that the loan period shall not exceed three (3) years and the limit to lend to each borrower and the aggregate loan amount shall not exceed 50% of the Company’s net worth.

Article 11

The Company shall evaluate and identify the contingency loss from the lending. The Company shall also disclose the information regarding the lending in the financial report and provide the same to the CPA for his proceeding with the necessary audit procedure and issuing the proper audit report.

Article 12

The internal audit personnel of the Company shall verify these Procedures and its implementation at least once every quarter and prepare a written report for record. If there is significant violation, the personnel shall inform the supervisors in writing immediately.

Article 13

The opinion of each independent director shall be fully taken into consideration when the Board of Directors discusses these Procedures and provision of loans. Opinions of each independent director for and against the said matter and reasons against said matters shall be clearly recorded in the minutes.

Article 14

The loan made before the implementation of these Procedures shall be filed with the Board of Directors for ratification and handled in accordance with these Procedures. If there is any loan exceeded the amount limit, the excess portion shall be withdrawn by installment.

Where the borrower becomes unqualified under these Procedures or the loan amount exceeds the limit as a result of changes of condition, the Company shall adopt rectification plans and submit the same to all the supervisors, and complete the rectification in accordance with the schedule.

Article 15

These Procedures, as well as any revision thereto, shall be approved by the Chairman of the board and filed with the Board of Directors for approval and sent to each supervisor and submitted to the shareholder meeting for approval.

Article 16

Another stricter management principles may be drafted by the Company’s Chairman in accordance with these Procedures and be effective after approval by the Board of Directors with two-thirds vote at a meeting attended by more than two-thirds of the directors. The same procedure shall apply to any amendment thereto.

Article 17

Approved by General Shareholder’s Meeting held on January 15, 1993. The First amendment was made on March 24, 1995.

The Second amendment was made on February 14, 1996.

The Third amendment was made on August 23, 1996.

The Fourth amendment was made on March 11, 1997.

The Fifth amendment was made on April 29, 2002.

The Sixth amendment was made on May 31, 2002.

The Seventh amendment was made on October 28, 2002.

The Eighth amendment was made on June 11, 2003.

The Ninth amendment was made on June 19, 2009. The Tenth amendment was made on June 18, 2010. The Eleventh amendment was made on June 15, 2012.

Appendix 7 Acer Incorporated Procedures Governing Endorsement and Guarantee (Before Amendments)

All endorsements and guarantees made by the Company shall comply with these Procedures. Matters not provided herein shall be governed by the relevant laws and regulations and the relevant regulations of the Company.

Article 1

The term “endorsement and/or guarantee” used in these Procedures includes the following.

Financial endorsement and/or guarantee, including: discounted bill financing; endorsement or guarantee made for the financing needs of other companies, issuing negotiable instruments for the purpose of providing guarantee to obtain finance for its own businesses to an entity other than the financial institutions.
Custom duty endorsement and/or guarantee, which shall mean endorsement or guarantee for the Company itself or other companies in respect of the custom duty matters.
Other endorsement and/or guarantee, which shall mean other endorsement or guarantee which cannot be included in the above two categories.
The Company creates a pledge or mortgage on its chattel or real estate as collateral for the loans of another Company.

Article 2 Applicability

The Company may provide endorsement and/or guarantee for the following companies and if it is necessary, security shall be obtained:

The companies with which it has business relations.
Subsidiaries in which the Company holds more than 50% of its total outstanding common shares.
For companies that are jointly invested by the Company or through its subsidiary, and if all the respective shareholders of such companies make endorsements and/or guarantees in proportion to their respective shareholding. The above referred investment means the investment by the Company directly or indirectly through its subsidiaries in which the Company holds 100% voting share.

The endorsements and/or guarantees may be provided among or between the companies in which the Company directly or indirectly holds 100% voting shares or capital.

Article 3 The Standard for Endorsement and/or Guarantee Assessment

In the event that the Company provides endorsements and/or guarantees by reason of business relations, the aggregate amount of the endorsements and/or guarantees shall not exceed the net worth of total trading amount between the two companies in the most recent year. The net worth of total trading amount between two companies means the total amount of purchase or re-sale, whichever is higher.

Article 4 Limits on Endorsements and/or Guarantees

The aggregate amount of endorsements and/or guarantees of the Company shall not exceed the Company’s net worth as shown in the latest financial report audited or reviewed by CPA.
The amount of endorsements and/or guarantees to any single enterprise shall not exceed the 20% of the Company’s net worth as shown in the latest financial report audited or reviewed by CPA.
The amount of endorsements and/or guarantees to any subsidiaries in which the Company holds 50% or more of its total outstanding common shares shall also be subject to the limit provided in Article 4.2.
The maximum of the whole endorsements and/or guarantees of the Company and its subsidiaries shall be subject to the limits provided in Articles 4.1 and 4.2.

Article 5 Procedures for Processing Endorsements and/or Guarantees

Enterprises which intend to apply for an endorsement and/or guarantee from the Company shall file an endorsement and/or guarantee application form with the Company’s finance department for review, in which application

type of endorsement and/or guarantee, name of the requesting company, risks evaluation, amount of endorsement/guarantee, content of collateral, terms and conditions and date for discharging endorsement/guarantee liabilities shall be specified. The finance department will submit the application to the Company’s Chairman for approval and then report to the Board of Directors for ratification; provided, however, that prior approval of the Board of Directors is required if the amount of endorsement/guarantee exceeds the amount for which the Company’s Chairman is authorized to conduct.

Upon the expiration of endorsement and/or guarantee, the endorsement and/or guarantee shall be terminated automatically. Before the expiration date, the endorsed and/or guaranteed enterprise shall file a cancellation form in order to terminate the endorsement and/or guarantee earlier.

Article 6 Review Procedures

When an enterprise applies for an endorsement and/or guarantee from the Company, it shall submit concrete description of necessity and reasonableness and the finance department will determine whether to accept the application or not.
The finance department will be in charge of credit check and risk evaluation of the endorsed and/or guaranteed enterprise. For those cases with good credit and justifiable purposes, the personnel in charge shall prepare a credit check result and opinion report and devise the criterion of the endorsement and/or guarantee and file with the Board of Directors for approval.
In addition to credit check and risk evaluation of the endorsed and/or guaranteed enterprise, the finance department shall make an assessment of impact on operation risk, financial condition and shareholder’s rights that may result from said endorsement/guarantee, and submit its opinion statement together with credit check report to the Board of Directors for approval.
The Company may decide whether to request the endorsed or guaranteed enterprise to provide the same amount of Banker’s acceptance or secure a collateral equivalent to the endorsement and/or guarantee amount according to their credit check report. The finance department shall evaluate and determine the value of the collateral.

Article 7 Control Procedures for the Company’s Subsidiaries

When the net worth of the subsidiaries for which the Company provides endorsements/guarantees is less than one-half of its paid-in capital, the relevant finance department shall re-estimate the risk of the principal debt at least every six months. In case there is the real risk that the principal debt will default, the finance department shall submit an improvement plan to the Company’s Chairman for approval and implement the same.
When any subsidiaries in which the Company holds 50% or more of its total outstanding common shares provide endorsements and/or guarantees to other companies, the subsidiaries shall enact the “Procedures Governing Endorsement and Guarantee” in accordance with these Procedures and the proposal shall be submitted to the Company’s Chairman for approval and filed with the Board of Directors of the Company for recordation. The Company shall make a public announcement in accordance with these Procedures.

Article 8 Procedures for Safekeeping and Use of the Corporate Chop

The Company shall use the Corporate Chop registered with the Ministry of Economic Affairs for the use of endorsements and/or guarantees (hereinafter, the “Chop”). The Chop shall be under the safekeeping of special personnel appointed by the Company’s Chairman and submit to the Board of Director for approval. The re-appointment of the special personnel shall follow the same procedure. The Chop may be used or to issue negotiable instruments only in accordance with internal procedures.
When the Company provides guarantees to a foreign company, the guarantee agreement shall be signed by the personnel authorized by the Board of Directors.

Article 9 Decision Making and Authorization

The approval of endorsements and/or guarantees shall be made by the Board of Directors after evaluating the risk in accordance with Article 5; provided, however, that the Board of Directors may authorize the Company’s Chairman to decide such matters within a specified amount and then submit the same to the Board of Directors for ratification.

Article 10 The Standards for Public Announcement

The Company shall make a public announcement on the amount of the Company and its subsidiaries endorsements and/or guarantees on or before the 10th date of each month. In addition, in the event that the amount reaches any of the following thresholds, the Company shall make a separate public announcement:
(1) The total amount of endorsements and/or guarantees reaches fifty percent (50%) or more of the Company’s net worth as shown in its latest financial report.
(2) The amount of endorsement and/or guarantee to any single enterprise reaches twenty percent (20%) or more of the Company’s net worth as shown in its latest financial report.
(3) The amount of endorsement and/or guarantee for any single enterprise reaches NT$10 million, and the aggregate amount of the endorsements and/or guarantees, long-term investment, and loans to that enterprise reaches thirty percent (30%) or more of the Company’s net worth as shown in its latest financial report.
(4) The aggregate amount of new endorsement and/or guarantee made reaches NT$30 million and five percent (5%) or more of the Company’s net worth as shown in its latest financial report.

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 this Paragraph.

Time Limits for and Contents of the Public Announcement
In the event that the amount of endorsements and/or guarantees reaches the thresholds provided in the preceding Paragraph 1, the Company shall make a public announcement and report within two days after the occurrence of said endorsements and/or guarantees.
(1) In the event that the aggregate amount of endorsements and/or guarantees reaches the thresholds set forth in Item (1) of Paragraph 1 of Article 10, the Company shall make a public announcement specifying the following:
- (a) The names of the enterprises for which the endorsement and/or guarantee was made and the amount of the endorsements and/or guarantees reaches NT$100 million or five percent (5%) or more of the Company’s net worth as shown in the Company’s latest financial report; its relationship with the Company; the maximum amount the Company is permitted to make endorsements and/or guarantees; the amount of and the reason for endorsement and/or guarantee as of the date of occurrence of the event.
- (b) As of the date of occurrence of the event, the ratio of the amount of endorsements and/or guarantees to the Company’s net worth as shown in its latest financial report.
(2) The Company shall make a public announcement including the following items when its endorsement and/or guarantee amount to a single enterprise reaches the thresholds set forth in Items (1), (2), (3), or (4) of Paragraph 1 of Article 10 (hereinafter “Event”):
- (a) The names of the enterprises for which the endorsement and/or guarantee was made, its relationship with the Company, the maximum amount the Company is permitted to make endorsements and/or guarantees, the endorsements and/or guarantees amount prior to the Event, and the amount and reason for such newadded endorsement and/or guarantee.
- (b) The content and value of the collateral provided by the endorsee and or guarantee.
- (c) The capital and accumulated profit/loss of the party for whom the endorsement and/or guarantee was made as shown in its latest financial report.
- (d) The terms and conditions or date of discharging the Company liabilities of endorsements and/or guarantees.
- (e) The ratio of the amount of endorsements and/or guarantees to the Company’s net worth as shown in the latest financial report as of the date of occurrence of the event.
- (f) The ratio of the amount of endorsements and/or guarantees to the business transaction amount between the Company and the endorsee and/or guarantee Company within the most recent year as of the date of occurrence of the event.
- (g) The ratio of the aggregate amount of the long term investment, endorsements/guarantees amount, and the loans to others to the Company’s net worth as shown in its latest financial report.

Article 11 Punishment of Violation of These Procedures

If relevant employees and personnel of the Company violate these Procedures, they will be subject to Articles 37 and 38 of the Company’s “Personnel Administration Regulations”.

Article 12

The Company shall evaluate the contingency loss from the endorsements and/or guarantees and disclose the information in the financial report appropriately and provide the same to the CPA for his proceeding with the necessary audit procedure and issuing the proper audit report.

Article 13

The Company shall prepare a registry containing the subject of the endorsements/guarantees, the amount of the endorsements/ guarantees, the date of approval of the Board of Directors or the Company’s Chairman (as the case may be), the date of the endorsements/guarantees and all the evaluation issues according to these Procedures.
The internal audit personnel of the Company shall verify these Procedures and its implementation and make a report in writing for record. If there is any significant violation, the personnel shall inform the supervisors in writing.

Article 14

Due to business relations, where the aggregate amount of endorsements and/or guarantees of the Company will exceed the limited amount specified in these Procedures, and the applicants are qualified for other requirements provided in these Procedures, such endorsements/guarantees shall be approved by the Board of Directors with majority of the board members sign as guarantors for the contingency loss resulting therefrom, and these Procedures shall be modified and then submitted to the shareholder meeting for ratification. If the aforesaid endorsement/guarantee is not approved by the shareholders’ meeting, the Company shall make a plan to eliminate such exceeding amount within a specific period of time.
The opinion of each independent director shall be fully taken into consideration when the Board of Directors discusses the above issue. Opinions of each independent director for and against the endorsement/guarantee and reasons against said matter shall be clearly recorded in the minutes.
When the Company submits the making of endorsements and/or guarantees for the Board of Directors’ approval, the board shall fully take each individual director’s opinions into consideration and record each director’s reasons for pros and cons in the minutes.

Article 15

If the Company makes the endorsement and/or guarantee later becomes unqualified under Article 2, or the endorsement and/or guarantee amount exceeds the limit under these Procedures due to the change of the calculation basis, the Company shall adopt plans and submit the plans to all the supervisors to discharge the endorsement and/or guarantee amount or the amount in excess within a designated period pursuant to relevant plan. The above timeframe shall be reported to the Board of Directors.

Article 16

These Procedures, as well as any revision thereto, shall be approved by the resolution of the Board of Directors and sent to each supervisor and submitted to the shareholders meeting for approval.

Article 17

Another stricter management principles may be drafted by the Company’s Chairman in accordance with these Procedures and put into effect after approved by the Board of Directors with two-thirds vote at a meeting attended by more than two-thirds of the directors. The same procedure shall apply to any amendment thereto.

Article 18

Approved by General Shareholder’s Meeting held on January 15, 1993. The First amendment was made on July 28, 1995. The Second amendment was made on April 28, 1997. The Third amendment was made on December 17, 2001. The Fourth amendment was made on June 11, 2003.

The Fifth amendment was made on June 17, 2004.

The Sixth amendment was made on June 15, 2006. The Seventh amendment was made on June 19, 2009. The Eighth amendment was made on June 18, 2010.

Appendix 8 Shares Held by Directors and Supervisors as of April 20, 2014

Directors

Name of Director	Legal Representative	Number of Shares
Stan Shih		74,592,499
Hsin-I Lin		0
Hung Rouan Investment Corp.		67,799,202
Smart Capital Corp.	Philip Peng	11,260
F.C. Tseng		0
Julian Michael Horn-Smith		0
TOTAL		142,402,961

Supervisors

Name of Supervisor	Legal Representative	Number of Shares
George Huang		8,261,844
Carolyn Yeh		17,493,157
TOTAL		25,755,001

The current number of issued shares in the Company is 2,834,726,828 shares. The Company’s directors shall hold at least 68,033,443 shares and the Company’s supervisors shall hold at least of 6,803,344 shares to comply with the “Rules and Review Procedures for Director and Supervisor Share Ownership Ratios at Public Companies”.

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ACER — AGM Information 2014

10414_rns_2014-07-07_5ea84a51-4108-432f-8993-376299d6e504.pdf

Disclaimer

ACER INCORPORATED (THE "COMPANY") Regulations for the Conduct of Shareholders’ Meetings

INDEX

A. Meeting Procedure

B. Meeting Agenda

Time: 9:00 a.m., Wednesday, June 18, 2014

1. Report Items

2. Proposed Resolutions (A)

3. Directors Election

4. Proposed Resolutions (B)

5. Extemporary Motion

6. Meeting Adjourned

1. Report Items

(1) To Report the Business of 2013 (Please refer to page 17 )

II. For the Non-Consolidated Financial Report

Supervisor: George Huang

2. Proposed Resolutions (A)

ITEM 1

3. Directors Election

4. Proposed Resolutions (B)

ITEM 2

ITEM 3

Acer Incorporated 2013 Statement of Deficit Compensated

ITEM 4

ITEM 5

Explanatory Notes:

ITEM 6

ITEM 7

5. Extemporary Motion

6. Meeting Adjourned

C. Attachment Attachment 1

Business Report to Shareholders

Attachment 2

Independent Auditors’ Report

Notes to Readers

ACER INCORPORATED AND SUBSIDIARIES

Consolidated Balance Sheets

December 31, 2013, December 31, 2012 and January 1, 2012

(In thousands of New Taiwan dollars)

ACER INCORPORATED AND SUBSIDIARIES

Consolidated Balance Sheets

December 31, 2013, December 31, 2012 and January 1, 2012

(In thousands of New Taiwan dollars)

ACER INCORPORATED AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

For the years ended December 31, 2013 and 2012

(In thousands of New Taiwan dollars, except loss per share data)

ACER INCORPORATED AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the years ended December 31, 2013 and 2012

(In thousands of New Taiwan dollars)

ACER INCORPORATED AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the years ended December 31, 2013 and 2012

(In thousands of New Taiwan dollars)

Independent Auditors’ Report

Notes to Readers

ACER INCORPORATED

Balance Sheets

December 31, 2013, December 31, 2012 and January 1, 2012

(In thousands of New Taiwan dollars)

ACER INCORPORATED

Balance Sheets

December 31, 2013, December 31, 2012 and January 1, 2012

(In thousands of New Taiwan dollars)

ACER INCORPORATED

Statements of Comprehensive Income

For the years ended December 31, 2013 and 2012

(In thousands of New Taiwan dollars, except loss per share data)

ACER INCORPORATED

Statements of Cash Flows

For the years ended December 31, 2013 and 2012

(In thousands of New Taiwan dollars)

ACER INCORPORATED

Statements of Cash Flows

For the years ended December 31, 2013 and 2012

(In thousands of New Taiwan dollars)

ACER AGM Information 2014