Table of Content

I.	Procedure of meeting ····························································· 1	Procedure of meeting ····························································· 1
II.	Meeting Agenda ··································································· 2
	1.	Report ········································································· 3
	2.	Ratification ·································································· 4
	3.	Discussion and Election ·················································· 6
	4.	Extemporary Motions ······················································ 10
III.	Appendix ··········································································· 11
	1.	Operation Highlight ························································ 12
	2.	Supervisor’s Review Report ·············································· 17
	3.	Auditor’s Report and Financial Statements of 2016`（`including
		consolidated financial statements`）`····································· 18
	4.	Articles of Incorporation ·················································· 38
	5.	Parliamentary Procedure of General Meeting
		(before amendment) ························································ 44
	6.	Regulation Governing Loaning of Funds ······························· 48
	7.	Procedure for Acquisition or Disposition of Assets ·················· 53
	8.	Regulation Governing Election of Directors and Supervisors
		(before amendment) ························································ 72
	9.	Regulation Governing Election of Directors and Supervisors
		(after amendment) ························································ 74
	10.	List of Nominees in the Election ······································· 79
	11.	Shareholding of all Directors and Supervisors ························ 80

Anderson Group

Procedure for Regular Session of 2017 General Meeting of Shareholders

I. Announcement of the session.
II. Message from the Chairman.
III. Report
IV. Ratification
V. Discussion and Election
VI. Extemporary Motions
VII. Adjournment of meeting
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Anderson Group Agenda for Regular Session of 2017 General Meeting

I Date and time: June 19 2017 (Monday), at AM 09:00.
II Place: 1F, No. 67~1, Dongyuan Road, Jhongli Industrial Park, Jhongli District, Taoyuan.
III Report on attendance and announcement of the session.
IV The address of the Chairman
V Report
(I) Operation Highlights of 2016.
(II) Financial Statements of 2016 reviewed by Supervisors.
(III) Endorsements, Guarantees, and Financing.
(IV) Remuneration to employees and Directors and Supervisors in 2016.
VI Ratification:
(I) Operation Highlight and Financial Statements of 2016.
(II) Proposal for Distribution of Earnings in 2016.
VII Discussion and Election
(I) Amendment to the “Articles of Incorporation” in part.
(II) Amendment to the “Procedure for General Meeting of Shareholders” in part.
(III) Amendment to the “Regulation Governing Financing” in part.
(IV) Amendment to the “Procedure for Acquisition and Disposition of Assets” in part.
(V) Capital reserve for distribution as cash dividend. (VI) Election of new Directors, Independent Directors, and Supervisors.
(VII) Lifting the ban on conflict of interest for the new Directors (including Independent Directors) and representatives..
(VIII) Amendment to the “Regulation Governing Election of Directors and Supervisors” in part.
IX Extemporary Motion.
X Adjournment of Meeting.
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Report

Motion No. 1

Cause of motion: Operation Result in 2016. Description: Refer to Operation Highlight 2016 (p. 12~16, Appendix I).

Motion No. 2

Cause of motion: Supervisor’s Review Report on 2016 account settlement. Description: Refer to Supervisor’s Review Report (p. 17, Appendix II).

Motion No. 3

Cause of motion: Status of Endorsement/Guarantee and Loaning of Funds. Description:

(I) The Company acted to guarantee the investees of the Anderson Group and Yude Technology Co., Ltd. for access to financing. The balance of loan guaranteed by the Company through endorsement amounted to EUR8,834,000, USD4,500,000 and NTD 520,000,000 as March 31, 2017.
(II) The total amount of endorsement/guarantee undertaken by the Company amounted to NTD942,972 thousand out of an overall limit for endorsement/ guarantee of 1,119,326 thousand and the upper limit for endorsement/guarantee to particular enterprise is 671,596 thousand, which is controlled within the limits. The detail is shown in the table below:

below:
Beneficiary	Amount of endorsement/guarantee			Loan balance		Remark
	Original currency:$	NTD: 1,000
Anderson Group (Anderson Europe) Yude Technology Co., Ltd. Sogotec Precision Co., Ltd. Anderson Group(Monforts) Matec Gmbh	EUR 370,000 US$ 1,000,000 NT$ 320,000,000 US$ 3,500,000 NT$ 200,000,000 EUR 3,464,000 EUR 5,000,000		11,999 30,330 320,000 106,155 200,000 112,338 162,150 942,972		- - 279,560 - 153,673 - - 433,233	CommerzBank Bank SinoPac Performance bond Performance bond

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(III) The total amount of loaning the others by the Company is NTD 301,066,000 out of and with an overall limit of 895,461 thousand and the upper limit of 447,730 thousand for particular enterprise, which is controlled within the limits. The details are as shown in the table below:

Beneficiary	Loaning limit	Loaning limit	Loaning limit	Balance of drawdown	Balance of drawdown	Remark
	Original currency:$	NTD: 1,000
Anderson Group Sogotec Precision Co., Ltd. Monforts GmbH	EUR 4,200,000 NT$ 100,000,000 EUR 2,000,000		136,206 100,000 64,860 301,066		18,809 - 29,187 47,996

Motion No. 4

Cause of motion: The remuneration to employees and Directors and Supervisors in 2016.

Description:

(I) Remuneration to employees and Directors and Supervisors in 2016 was made pursuant to Article 20 of the Articles of Incorporation of the Company.
(II) The Company planned to appropriate 1% of the earnings before taxation as remuneration to employees and Directors and Supervisors, which amounted to NTD1,227,335 to the employees and NTD1,227,335 to the Directors and Supervisors.
(III) This motion has been passed by the Remuneration Committee of the Company in a session held on March 16, 2017 and approved by the 3[rd] session of the 9[th] Board of Directors held on March 31, 2017.

Ratification

Motion No. 1: (presented by the Board)

Cause of motion: The 2016 Operation Highlight and Financial Statements are presented for ratification.

Description: The Financial Statements of the Company covering fiscal

year 2016 were audited by certified public accountants with the issuance of Auditor’s Report and passed by the Board. The 2016 Operation Highlight (p. 18~37 in Appendix III, and p. 12~16 in Appendix I) was also passed by the Board and referred to the Supervisors for review.

Resolution:

Motion No. 2: (presented by the Board)

Cause of motion: The proposal for the distribution of earnings in 2016 is presented for ratification.

Description: The Company had corporate earnings of NTD98,615,531 in 2016 and planned to distribute as specified in the table below, and presented for ratification.

Anderson Group Earnings Distribution Table FY 2016 Currency unit: NTD

and presented for ratification.
Anderson Group
Earnings Distribution Table
FY 2016
unit: NTD Currency

Undistributed earnings at beginning
Less: Reassessed defined benefit plan recognized as retained
earnings
Undistributed earnings after adjustment
Plus: earnings in 2016
Subtotal
Less: Appropriation of legal reserve
Less: Appropriation of special reserve
Earnings attributable to shareholders
Shareholder dividends:
Cash dividend: NT$0.20/share
Stock dividend: NT$0.00/share
Undistributed earnings at ending ＄2,799,375
( 605,463
)
2,193,912
98,615,531
100,809,443
( 9,861,553)
( 50,623,668
)
40,324,222
( 35,266,200)
-
$ 5,058,022

Chairman:
Liao Wen-Chia
Person in charge:
Lin Chi-chuan
Chief Accounting Office
Huang Yi-Hsien

and presented for ratification. Anderson Group Earnings Distribution Table FY 2016 unit: NTD	Currency
Undistributed earnings at beginning Less: Reassessed defined benefit plan recognized as retained earnings Undistributed earnings after adjustment Plus: earnings in 2016 Subtotal Less: Appropriation of legal reserve Less: Appropriation of special reserve Earnings attributable to shareholders Shareholder dividends: Cash dividend: NT$0.20/share Stock dividend: NT$0.00/share Undistributed earnings at ending	`＄`2,799,375 ( 605,463 ) 2,193,912 98,615,531 100,809,443 ( 9,861,553) ( 50,623,668 ) 40,324,222 ( 35,266,200) - $ 5,058,022
Chairman: Liao Wen-Chia Person in charge: Lin Chi-chuan Chief Accounting Office Huang Yi-Hsien

Resolution:

Discussion and Election

Motion No. 1: (presented by the Board)

Motion: Amendment to the “Articles of Incorporation in part” is presented for resolution.

Description:

(I) Amendment to the “Articles of Incorporation” of the Company in accordance with Financial Supervisory Commission (FSC) January 18, 2017, Letter Jin-Guan-Zheng-Jiao-Zi No. 1060000381 to make it relevant with the latest trend and spirit of corporate governance.
(II) The mapping of the clauses before and after the amendment is shown in the table below. For information on the “Articles of Incorporation” before amendment, refer to p.38~43 of Appendix IV.

Resolution:

Motion No. 2: (presented by the Board)

Cause of motion: Amendment to the “Parliamentary Procedure for General Meeting of Shareholders” in part is presented for resolution. Description: The amendment to the Articles of Incorporation of the Company dictated for parallel amendment to the “Parliamentary Procedure for the General Meeting of Shareholders”. The mapping of the clauses before and after the amendment is shown in the table below. The “Parliamentary Procedure for General Meeting of Shareholders” before the amendment is exhibited on p.44~47 in Appendix V.

Resolution:

Motion No. 3: (presented by the Board)

Cause of motion: Amendment to the “Regulation Governing Loaning of Funds” in part is presented for resolution.

Description:

The “Regulation Governing Loaning of Funds” of the Company is amended pursuant to Article 9, Section 3, of the “Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies”. The mapping of the clauses before and after the amendment is shown in the table below. The “Regulation Governing Loaning of Funds” before the amendment is exhibited on p. 48~52 in Appendix VI.

Resolution:

Motion No. 4: (presented by the Board)

Cause of motion: Amendment to the “Procedure for Acquisition or Disposition of Assets” in part is presented for resolution. Description: The “Procedure for Acquisition or Disposition of Assets” of the Company is amended in response to the amendment to the “Criteria for Acquisition and Disposition of Assets” under Financial Supervisory Commission Securities and Futures Bureau Letter Jin-Guan-Zheng-Fa-Zi no. 10600012965 dated February 9, 2017. The mapping of the clauses before and after the amendment is shown in the table below. The “Procedure for Acquisition or Disposition of Assets” before the amendment is exhibited on p. 53~71 of Appendix VII.

Resolution:

Motion No. 5: (presented by the Board)

Cause of motion: The proposal of the Company for the distribution of additional paid-in capital (APIC) as cash dividend is presented for resolution.

Description:

(I) The Company planned to distribute APIC from the issuance of stock at premium, which amounted to NTD17,633,100, as cash dividend to shareholders on the shareholders registry as of the dividend day. The
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cash dividend will be paid at NT$0.1/share round to the nearest NT Dollar.

(II) The quantity of outstanding share of the Company may be subject to change under the action of the competent authority, or, the raising of capital by the Company through issuing new shares, to the extent that the payment rate will be chanced accordingly, we asked the General Meeting to authorize the Board with full power of attorney to respond to any of the aforementioned situations.
(III) We asked the General Meeting to authorize the Board to set the dividend day.

Resolution:

Motion No. 6: (presented by the Board)

Cause of motion: The proposal for the election of new Directors, Independent Directors, and Supervisors is presented for resolution.

Description:

(I) According to the Articles of Incorporation of the Company, Directors and Supervisors shall each have tenure of 3 years. The 9[th] Board of Directors was elected and assumed office on June 6, 2014 and the term will expire on June 5, 2017. For the convention of the General Meeting in 2017 and the election of a new Board of Directors, the Directors and Supervisors of the 9[th] Board continue their term of office to June 19, 2017 pursuant to Article 195-2 of the Company Act until a new Board is elected by the regular session of the General Meeting of Shareholders which by then the Directors and Supervisors of the 9[th] Board shall be relieved from office.
(II) According to Article XIII of the Articles of Incorporation of the Company, there will be 7 seats of Directors (including 2 seats of Independent Directors) and 3 seats of Supervisors with term of 3 years. The new Board of Directors and Supervisors shall assume office immediately after being elected to the seats and each have tenure of 3 years. The term of office will start on June 19, 2017 and will expire on June 18, 2020. Information on the Regulation Governing the Election of Directors and Supervisors is shown on p.74~78 in Appendix IX.
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(III) The Company adopts the nomination of candidate system pursuant to Article XIII of the Articles of Incorporation and Article 5 of the “Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies”. The list of candidates of Independent Directors has been resolved by the 5[th] session of the 9[th] Board held on May 4, 2017. The profiles of the candidates including education, experience, and quantity of shareholding are exhibited on p. 79 in Appendix X.

Election Result:

Motion No. 7: (presented by the Board)

Cause of motion: Proposal to remove the prohibition of the conflict of interest on new Directors (including Independent Directors) and their representatives is presented for resolution.

Description:

(I) According to Article 209 of the Company Act, any act of the Directors within the scope of registered business of the Company for themselves or a third party shall be elaborated before and subject to the permission of the General Meeting of Shareholders.
(II) As dictated by the needs of the Company in business development and operation strategy, we moved to remove the prohibition of the conflict of interest for new Directors (including Independent Directors) and their representatives by this session of the General Meeting of Shareholders.

Resolution:

Motion No. 8: (presented by the Board)

Cause of motion: Amendment to the “Regulation Governing the Election of Directors and Supervisors” in part is presented for resolution.
Description: Inasmuch as the establishment of seats for Independent Directors, the company shall amend its “Regulation
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Governing the Election of Directors and Supervisors” in part. The mapping of the clauses before and after the amendment is shown in the table below. The “Regulation Governing the Election of Directors and Supervisors” before the amendment is exhibited on p.72~73 in Appendix VIII.

Resolution:

Extemporary Motions

Adjournment of meeting

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Appendix

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[Appendix I]

Anderson Group

Operation Highlight

I. Operation Results of 2016

The Company had revenue of NT$3,697,479,000 in 2016, which was an increase of NT$560,792,000, or 18%, from the same period of 2015. Gross profit in 2016 amounted to NT$1,234,498,000, an increase of NT$327,367,000, or 36%, from the same period of 2015.

The increase in operating expense is mainly caused by newly acquired subsidiary for holding in the whole year that made operating expense in 2016 amounted to NT$1,088,010,000, an increase of NT$113,936,000 from 2015. This ended up with an operating income of NT$146,488,000 or an increase of NT$213,431,000 from the same period of 2015. Due to the wide fluctuation of exchange rate in 2016, exchange gain was recognized that resulted in a decrease of non-operating income. Earnings before taxation for the Company in 2016 amounted to NT$140,047,000, which was an improvement from the profit level of 2015.

1. The outcome of business plan

he outcome of business plan	he outcome of business plan	he outcome of business plan
Consolidated Financial Statement Currency					unit: NTD1,000
	2016		2015		Change
	Amount	%	Amount	%	Amount	%
Net sale	3,697,479	100	3,136,687	100	560,792	18
Gross profit	1,234,498	33	907,131	29	327,367	36
Operating expense	1,088,010	29	974,074	31	113,936	12
Operating Income(loss)	146,488	4	(66,943)	(2)	213,431	319
Non-operating income (expense) - net	(6,441)	0	23,805	1	(30,246)	(127)
Earnings (loss) before taxation	140,047	4	(43,138)	(1)	183,185	425
Earnings (loss) in current period	97,025	3	(42,090)	(1)	139,115	331
Shareholders’ equity attributable to parent company	98,616	3	(41,201)	(1)	139,817	339

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2. Analysis of income position and profitability

			Currency unit: NTD1,000 2016 2015 146,488 (66,943) (6,441) 23,805 140,047 (43,138) 97,025 (42,090) 2.56 (0.50) 4.21 (1.81) 8.14 (3.78) 7.78 (2.44) 2.62 (1.44) 0.56 (0.24)	Currency unit: NTD1,000 2016 2015 146,488 (66,943) (6,441) 23,805 140,047 (43,138) 97,025 (42,090) 2.56 (0.50) 4.21 (1.81) 8.14 (3.78) 7.78 (2.44) 2.62 (1.44) 0.56 (0.24)
	Item		2016	2015
Income position	Operating income		146,488	(66,943)
	Non-operating income (loss) – net		(6,441)	23,805
	Earnings before taxation		140,047	(43,138)
	Earnings in	current period	97,025	(42,090)
Profitability	ROA%		2.56	(0.50)
	ROE%		4.21	(1.81)
	Ratio to paid-in capital	Operating income	8.14	(3.78)
		Earnings before taxation	7.78	(2.44)
	Net profit rate%		2.62	(1.44)
	EPS in NTD		0.56	(0.24)

R&D result

R&D projects completed in 2016:

(1). Development of through-type light processing machine
(2). Development of PTP3012 drilling machine
(3). Development of G448 machine
(4). Development of SpectraPlus core winder
(5). Development of Multiple-layer aluminum cutter.
(6). Development of KS4600 welting machine
(7). Development of HSK63FDC principal axis.
(8). Development of HSK40EDC principal axis.
(9). Development of HSK50EAC principal axis.
(10). Development of new version of SoCJetting main board.
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II. Production and sale policy and business objective in 2017

1. Precision machinery

The enhancement of the high precision of the five-axis linkage machinery in 2017 and the change in product design for getting closer to market needs allowed for the smooth launch of the technology to the application market such as aeronautics, defense, yacht, composite materials, and wood works. A professional team will be assigned to this area in 2017 for further development of five-axis product in depth and wider scope of application.

In the aspect of channeling, the augmentation of the furniture market in Mainland China is echoed with the ceaseless development of new industries that contributed to the formation of board market line incrementally. The Company will assign a sale and service team to selected locations for quick response to market needs and is seeking regional distributors in good standing for development of the product lines. Likewise, the production of products that fit the market needs in the market of China will be relocated from Houlong to Zhongde. In the Australian market, product differentiation will be the gravity of work with the addition of new functions to existing product lines and make operation of the products more convenient, complete, and integral for the users. In addition, new products will be developed to satisfy market needs. In the USA, further effort will be made to reinforce and expand in the markets of word and composite materials with the setup of a service team and distributors. The specifications of products will also be adjusted to aim at stable quality in production, short delivery lead-time, and quick response in service.

In 2016, 627 units of CNC precision processing centers were sold. It is expected that 724 units of this item will be sold in 2017 or at the growth rate of 15%.

2. Electronic Machine Plant (Sogotec)

The prime operation objective of the Company in 2017 is the development of a wider array of products and market. Further to maintaining the market share of drilling/forming machines, the Company also plans to extend to the automation of conventional industries. In responding to the hot issue of Industry 4.0, the Company will take automation of conventional industries as the driving force to provide a

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solution for customers in dealing with the problem of high cost and labor shortage.

The development of products featuring new applications of laser technology will include the continued promotion of UV soft panel laser drilling machine and different applications of laser technology in automation. In addition, the Company also seeks to develop multiple-function laser cutter for horizontal development of a whole laser product line.

Another integral part of its production and sale policy is the cross-industry alliance and ODM outsourcing, which will remain a vital task in 2017. Further to the manufacturing of high precision professional machinery platform in other countries, the Company will seek to work with international big firms for OEM orders.

In 2016, 226 units of electronic machines were sold. It is expected that 310 units will be sold in 2017 or at the growth rate of 37%.

3. Inkjet Printing Machine Plant

The Company will continue success of the latest KonicaMinolta jet nozzle introduced last year to the product line with in-depth product differentiation and segmentation. The low cost high quality models for small-scale operations will be advanced to high price-performance ration models for intermediate production capacity. This will be the main product lines in the two years ahead. Likewise, the models used in high-speed mass production of big enterprises will be matched with and linked to automation of production that pushes the performance of the high-speed mass production models to its entirety in production capacity.

For the sale in Mainland China, the objective will be the engagement in a joint venture with the biggest marketing channels of China in woodwork equipment, “Homag China Golden Field Limited” in 2017. In so doing, the application technology and equipment that has been deeply cultivated by the Company will be integrated with the business locations, channels, and exhibition centers of Homag and targets to the full-range cooperation for developing the big market of work furniture in China.

While developing the matching of high-speed models and automation equipment, the Company also explores the specification of the SinglePass application machinery for the wood industry in the future. The primary goal will be the panel sealing digital inkjet printing, which based on the success of the Hybrid model used by the customers in glass inkjet

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printing for replication to other related customers. In addition, the shoe making industry in Taiwan will not be neglected (most of the firms are in Taiwan). The Hybrid model on inventory will be digested by appropriate industries.

In 2016, 30 units of inkjet printing machines were sold. It is expected that 88 units will be sold in 2017 or at the growth rate of 193%.

III. The effect of external competitive environment, legal environment, and operation environment
The year 2017 will still be clouded by the uncertainties carried forward from 2016, which include Brexit, the new government in the USA and in Taiwan. These will increase the operation risk of the Company.
The economic cycle changed very quickly and purchase orders tended to be big with very short delivery lead-time. This will be a challenge to the supply chain management capacity and production adjustment capacity of the firms. Accordingly, inventory management becomes more difficult.
Due to the competitive nature and business practice for some products, it usually takes time to settle the accounts. In turn, the pressure of fund appropriation will be intensified.
IV. Development strategy in the future
Improvement of existing models for quality upgrade.
Development of human resources for international marketing and technical service teams for development of channels in the newly emerging markets.
Searching for strategic partners to intensify the vertical and horizontal integration of products.
Increase the proportion of self-manufactured key parts and components to reduce cost so as to upgrade the competitive power of products.
Development of new market for bringing in more revenue.

Chairman: Person in charge: Chief Accounting Liao Wen-Chia Lin Chi-Chuan Officer: Huang Yi-Hsien

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[Appendix II]

Anderson Group Supervisor’s Review Report

To: Regular Session of 2017 General Meeting of Shareholders

Date: March 31, 2017

The Board of Directors of Anderson Group has compiled the Operation Highlight, separated financial statements and consolidated financial statements, and the proposal for distribution of earrings for fiscal period of 2016. The separate and consolidated financial statements covering 2016 were audited and certified by certified public accountants of Deloitte Taiwan with the issuance of Auditor’s Report.

We have reviewed the aforementioned documents and statements and confirmed that they are prepared in conformity to the Company Act and other applicable laws. Pursuant to Article 219 of the Company Act, we hereby present this report for your reference.

Supervisor: Chu Yung-Ta Supervisor: Lee Huei-Chin

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[Appendix III] INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders Anderson Industrial Corporation

Opinion

We have audited the accompanying financial statements of Anderson Industrial Corporation (the “Corporation”), which comprise the balance sheets as of December 31, 2016 and 2015, and the statements of comprehensive income, changes in equity and cash flows for the years then ended, and the notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Corporation as of December 31, 2016 and 2015, and its financial performance and its cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements for the year ended December 31, 2016. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Key audit matters for the Corporation’s financial statements for year 2016 are stated as follows:

Inventory Provision

As of December 31, 2016, the balance of inventory held by the Corporation was $254,449 thousand, a significant amount representing 7% of total assets. Because assessment of net realizable value of inventory is an area of the Corporation’s significant judgement based on IAS 12 “Inventory”, we believe that inventory provision is one of key audit matters. Please refer to Notes 5 and 8 to the financial statements.

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Our primary audit procedures in respect of this area included understanding the appropriateness of inventory provisioning policy, assessing the reasonableness of net realizable value by performing tests of samples of sales, reviewing and implementing year-end inventory count, assessing the condition of the inventory and recalculating the amount of inventory provision.

Estimated Impairment of Accounts Receivable

As of December 31, 2016, the balance of accounts receivable held by the Corporation was $595,776 thousand, a significant amount representing 17% of total assets. The evaluation of accounts receivable provision for loss, credit risk and appropriateness of provisioning policy is an area of significant judgment; therefore, we believe that the estimated impairment of accounts receivable is a key audit matter. Please refer to Notes 5 and 7 to the financial statements.

Our primary audit procedures in respect of this area included assessing the appropriateness of accounts receivable provisioning policy, testing the validity of the aging reports, analyzing circumstances of accounts receivable movements and significant past due accounts receivable, assessing the reasonableness of individual accounts receivable impairment, confirming whether there is any sign of impairment or not at the end of the year. Recoverability was also tested by vouching cash receipts after the year end date.

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

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

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

Those charged with governance, including supervisors, are responsible for overseeing the Corporation’s financial reporting process.

Auditors’ Responsibilities for the Audit of the Financial Statements

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

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

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

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

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

20 -

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements for the year ended December 31, 2016 and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partners on the audit resulting in this independent auditors’ report are Yu Wei Fan and Hsin Wei Tai.

Deloitte & Touche Taipei, Taiwan Republic of China March 31, 2017

Notice to Readers

The accompanying financial statements are intended only to present the financial position, financial performance and cash flows in accordance with 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 applied in the Republic of China.

For the convenience of readers, the independent auditors’ report and the accompanying 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 independent auditors’ report and financial statements shall prevail.

21 -

ANDERSON INDUSTRIAL CORPORATION

BALANCE SHEETS DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS Cash and cash equivalents (Notes 4 and 6) Available-for-sale financial assets - current (Notes 4 and 22) Debt investments with no active market - current (Note 4) Notes receivable, net (Notes 4 and 7) Accounts receivable - third parties (Notes 4, 7, 22 and 24) Accounts receivable - related parties (Notes 7 and 23) Other receivables (Notes 4 and 23) Inventories (Notes 4 and 8) Prepayments (Note 23) Other current assets Total current assets NON-CURRENT ASSETS Investments accounted for using the equity method (Notes 4, 9 and 10) Property, plant and equipment (Notes 4, 10, 23 and 24) Intangible assets (Notes 4 and 11) Deferred tax assets (Notes 4 and 18) Long-term notes and accounts receivable (Notes 4, 7 and 24) Other non-current assets (Note 24) Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Notes 12 and 24) Notes payable Accounts payable (Note 23) Other payables (Notes 13 and 23) Provisions - current (Note 4) Current portion of long-term borrowings (Notes 12 and 24) Other current liabilities Total current liabilities NON-CURRENT LIABILITIES Long-term borrowings (Notes 12 and 24) Deferred tax liabilities (Note 18) Net defined benefit liabilities (Notes 4 and 14) Other non-current liabilities Total non-current liabilities Total liabilities EQUITY (Notes 4 and 15) Share capital Common stock Capital surplus Retained earnings Legal reserve Unappropriated earnings Total retained earnings Other equity Exchange differences on translating foreign operations Unrealized loss on available-for-sale financial assets Total other equity Treasury shares Total equity TOTAL		2016 Amount % $ 112,235 3 18,753 1 10,000 - 19,751 1 142,457 4 453,319 13 162,396 4 254,449 7 18,020 - 570 - 1,191,950 33 1,589,315 44 718,882 20 40,030 1 34,237 1 - - 51,210 1 2,433,674 67 $ 3,625,624 100 $ 260,000 7 2,331 - 217,117 6 101,730 3 13,075 1 150,875 4 30,683 1 775,811 22 471,611 13 13,912 - 66,106 2 344 - 551,973 15 1,327,784 37 1,800,000 50 319,573 9 163,053 4 100,810 3 263,863 7 (43,573) (2) (7,051 ) - (50,624 ) (2 ) (34,972 ) (1 ) 2,297,840 63 $ 3,625,624 100		2015
				Amount % $ 303,610 8 27,230 1 10,000 - 34,516 1 220,429 6 487,078 13 89,368 2 290,856 7 26,699 1 8,721 - 1,498,507 39 1,488,654 39 645,386 17 41,407 1 39,423 1 54,065 2 43,418 1 2,312,353 61 $ 3,810,860 100 $ 693,696 18 12,772 - 198,266 5 130,672 4 17,629 1 107,057 3 52,778 1 1,212,870 32 206,744 6 - - 129,751 3 40 - 336,535 9 1,549,405 41 1,800,000 47 337,206 9 163,053 4 2,800 - 165,853 4 (6,849) - (4,692 ) - (11,541 ) - (30,063 )(1 ) 2,261,455 59 $ 3,810,860 100

The accompanying notes are an integral part of the financial statements.

22 -

ANDERSON INDUSTRIAL CORPORATION

STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OPERATING REVENUE (Notes 4, 16 and 23) OPERATING COSTS (Notes 8, 17 and 23) GROSS PROFIT REALIZED GAIN ON TRANSACTIONS WITH SUBSIDIARIES REALIZED GROSS PROFIT OPERATING EXPENSES (Notes 4 and 17) Selling and marketing expenses General and administrative expenses Research and development expenses Total operating expenses LOSS FROM OPERATIONS NON-OPERATING INCOME AND EXPENSES (Notes 4 and 17) Other income (Note 23) Other gains and losses Finance costs Share of profits (losses) of subsidiaries and associates accounted for using the equity method (Note 9) Total non-operating income and expenses PROFIT (LOSS) BEFORE INCOME TAX INCOME TAX EXPENSE (Notes 4 and 18) NET PROFIT (LOSS) FOR THE YEAR		2016 Amount % $ 1,123,840 100 799,030 71 324,810 29 12,782 1 337,592 30 144,126 13 168,817 15 49,521 4 362,464 32 (24,872 ) (2 ) 72,008 7 (33,040) (3) (18,546) (2) 124,729 11 145,151 13 120,279 11 (21,663 ) (2 ) 98,616 9		2015
				Amount % $ 1,446,687 100 1,159,009 80 287,678 20 5,491 - 293,169 20 144,716 10 148,576 10 52,808 4 346,100 24 (52,931 ) (4 ) 43,819 3 14,588 1 (19,132) (1) (15,361 ) (1 ) 23,914 2 (29,017) (2) (12,184 ) (1 ) (41,201 ) (3 ) (Continued)

23 -

ANDERSON INDUSTRIAL CORPORATION

STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OTHER COMPREHENSIVE INCOME (LOSS) Items that will not be reclassified subsequently to profit or loss: Remeasurement of defined benefit plans Share of the other comprehensive income (loss) of subsidiaries and associates accounted for using the equity method Income tax relating to items that will not be reclassified subsequently to profit or loss Items that may be reclassified subsequently to profit or loss: Exchange differences on translating foreign operations Unrealized gain (loss) on available-for-sale financial assets Share of the other comprehensive income (loss) of subsidiaries and associates accounted for using the equity method Other comprehensive loss for the year, net of income tax TOTAL COMPREHENSIVE INCOME (LOSS) FOR THE YEAR EARNINGS (LOSS) PER SHARE (Note 19) Basic Diluted		2016 Amount % $ 298 - (853) - (51 ) - (606 ) - (36,724) (3) 1,523 - (3,882 ) (1 ) (39,083 ) (4 ) (39,689 ) (4 ) $ 58,927 5 $ 0.56 $ 0.56		2015
				Amount % $ (11,511) - (820) - 1,957 - (10,374 ) - (39,262) (3) (1,590) - (114 ) - (40,966 ) (3 ) (51,340 ) (3 ) $ (92,541 ) (6 ) $ (0.24 )




		$		$

The accompanying notes are an integral part of the financial statements. (Concluded)

24 -

ANDERSON INDUSTRIAL CORPORATION

STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars, Except Per Share Amount)

Common Stock Capital Surplus BALANCE AT JANUARY 1, 2015 $ 1,470,000 $ 304,206 Appropriation of 2014 earnings Legal reserve - - Cash dividends distributed by the Corporation - NT$0.1 per share - - Balance after appropriation 1,470,000 304,206 Net loss for the year ended December 31, 2015 - - Other comprehensive loss for the year ended December 31, 2015, net of income tax - - Total comprehensive loss for the year ended December 31, 2015 - - Issue of ordinary shares for cash 330,000 33,000 Buy-back of ordinary shares - - Adjustments from changes in percentage of ownership of subsidiaries - - BALANCE AT DECEMBER 31, 2015 1,800,000 337,206 Cash dividends distributed from capital surplus - (17,633) Net profit for the year ended December 31, 2016 - - Other comprehensive loss for the year ended December 31, 2016, net of income tax - - Total comprehensive income (loss) for the year ended December 31, 2016 - - Buy-back of ordinary shares - - BALANCE AT DECEMBER 31, 2016 $ 1,800,000 $ 319,573	Retained Earnings Legal Reserve Unappropriated Earnings $ 161,309 $ 74,123 1,744 (1,744) - (18,000 ) 163,053 54,379 - (41,201) - (10,374 ) - (51,575 ) - - - - - (4 ) 163,053 2,800 - - - 98,616 - (606 ) - 98,010 - - $ 163,053 $ 100,810	Other Equity Exchange Differences on Translating Unrealized Gain (Loss) on Available-for- Foreign Operations sale Financial Assets $ 32,413 $ (2,988) - - - - 32,413 (2,988) - - (39,262 ) (1,704 ) (39,262 ) (1,704 ) - - - - - - (6,849) (4,692) - - - - (36,724 ) (2,359 ) (36,724 ) (2,359 ) - - $ (43,573 ) $ (7,051 )	Treasury Shares $ - - - - - - - - (30,063) - (30,063) - - - - (4,909 ) $ (34,972 )	Total Equity $ 2,039,063 - (18,000 ) 2,021,063 (41,201) (51,340 ) (92,541 ) 363,000 (30,063) (4 ) 2,261,455 (17,633) 98,616 (39,689 ) 58,927 (4,909 ) $ 2,297,840

The accompanying notes are an integral part of the financial statements.

25 -

ANDERSON INDUSTRIAL CORPORATION

STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars)

CASH FLOWS FROM OPERATING ACTIVITIES
Profit (loss) before income tax

Adjustments for:
Depreciation expenses
Amortization expenses
Impairment loss recognized (reversal of impairment loss) on
accounts receivable
Finance costs
Interest income
Share of (profit) loss of subsidiaries and associates accounted for
using the equity method

Loss on disposal of property, plant and equipment, net
(Gain) loss on disposal of available-for-sale financial assets, net
Loss on disposal of investments accounted for using the equity
method
Reversal of impairment loss on non-financial assets
(Realized) unrealized profit with subsidiaries
Changes in operating assets and liabilities
Notes receivable
Accounts receivable (including - long-term receivables)
Accounts receivable - related parties (including - long-term
receivables)
Other receivables
Inventories
Prepayments
Other current assets
Notes payable
Accounts payable
Other payables
Provisions
Other current liabilities
Net defined benefit liabilities

Cash generated from operations
Interest received
Interest paid
Income tax paid

Net cash generated from operating activities

CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of available-for-sale financial assets
Proceeds from redemption of debt investments with no active market
Purchase of investments accounted for using the equity method

Proceeds from disposal of investment accounted for using the equity
method

2016
2015
$ 120,279
$ (29,017)
55,047
44,852
1,377
5,358
4,593
(11,795)
18,546
19,132
(1,297)
(1,136)
(124,729)
15,361
63
1,539
136
(757)
8
-
(826)
(12,115)
(12,782)
47,063
14,765
21,767
127,444
211,084
33,759
386,873
(73,028)
(60,576)
37,389
100,152
(14,071)
674
8,151
(7,881)
(10,441)
12,772
18,851
(61,308)
(28,893)
(61,958)
(4,554)
(5,703)
(21,791)
19,543

(63,348
)

(3,419
)
84,648
630,505
1,297
1,136
(18,595)
(18,321)

(2,616
)

(48,631
)

64,734

564,689
9,864
16,589
-
974
(409,202)
(373,416)
383,396
-
(Continued)

26 -

ANDERSON INDUSTRIAL CORPORATION

STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars)

Payments for property, plant and equipment Proceeds from disposal of property, plant and equipment Decrease (increase) in refundable deposits Increase in non-current assets Dividends received from subsidiaries Net cash used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES Increase (decrease) in short-term borrowings Proceeds from long-term borrowings Repayment of long-term borrowings Cash dividends paid Issue of ordinary shares for cash Payments for buy-back of ordinary shares Net cash used in financing activities NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR	2016 $ (106,076) 64 (1,186) (6,606) 21,190 (108,556 ) (433,696) 470,000 (161,315) (17,633) - (4,909 ) (147,553 ) (191,375) 303,610 $ 112,235	2015 $ (35,907) 33 8,111 (11,759) 20,000 (375,375 ) 373,696 - (698,909) (18,000) 363,000 (30,063 ) (10,276 ) 179,038 124,572 $ 303,610

The accompanying notes are an integral part of the financial statements.

(Concluded)

27 -

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders Anderson Industrial Corporation

Opinion

We have audited the accompanying consolidated financial statements of Anderson Industrial Corporation (the “Corporation”) and its subsidiaries (collectively, the “Group”) which comprises the consolidated balance sheet as of December 31, 2016 and 2015, and the consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and the notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2016 and 2015, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

Basis for Opinion

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements for the year ended December 31, 2016. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

28 -

Key audit matters for the Group’s consolidated financial statements for the year ended December 31, 2016 are stated as follows:

Inventory Provision

As of December 31, 2016, the balance of inventory held by the Group was $1,219,127 thousand, a significant amount representing 25% of total assets. Because assessment of net realizable value of inventory is an area of the Group’s significant judgement based on IAS 12 “Inventory”, we believe that inventory provision is one of key audit matters. Please refer to Notes 5 and 8 to the consolidated financial statements.

Estimated Impairment of Accounts Receivable

As of December 31, 2016, the balance of accounts receivable held by the Group was $1,110,750 thousand, a significant amount representing 23% of total assets. The evaluation of accounts receivable provision for loss, credit risk and appropriateness of provisioning policy is an area of significant judgment; therefore, we believe that the estimated impairment of accounts receivable is a key audit matter. Please refer to Notes 5 and 7 to the consolidated financial statements.

Other Matter

We have also audited the parent company only financial statements of Anderson Industrial Corporation as of and for the years ended December 31, 2016 and 2015 on which we have issued an unqualified and a modified unqualified opinion, respectively.

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

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

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

29 -

Those charged with governance, including the supervisors, are responsible for overseeing the Group’s financial reporting process.

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

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

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

30 -

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements for the year ended December 31, 2016 and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partners on the audit resulting in this independent auditors’ report are Yu Wei Fan and Hsin Wei Tai.

Deloitte & Touche Taipei, Taiwan Republic of China March 31, 2017

Notice to Readers

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

For the convenience of readers, the independent 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 consolidated financial statements shall prevail.

31 -

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars)

ASSETS CURRENT ASSETS Cash and cash equivalents (Notes 4 and 6) Financial assets at fair value through profit or loss - current (Note 4) Available-for-sale financial assets - current (Note 4) Debt investments with no active market - current (Note 4) Notes receivable, net (Notes 4, 7, 23 and 25) Accounts receivable, net (Notes 4, 7, 23 and 25) Other receivables (Note 4) Inventories (Notes 4 and 8) Prepayments Other current assets Total current assets NON-CURRENT ASSETS Financial assets measured at cost - non-current (Note 4) Property, plant and equipment (Notes 4, 11 and 25) Intangible assets (Notes 4 and 12) Deferred tax assets (Notes 4 and 19) Long-term notes and accounts receivable (Notes 4, 7 and 25) Other non-current assets (Note 25) Total non-current assets TOTAL LIABILITIES AND EQUITY CURRENT LIABILITIES Short-term borrowings (Notes 13 and 25) Notes payable Accounts payable Other payables (Note 14) Current tax liabilities (Notes 4 and 19) Provisions - current (Note 4) Current portion of long-term borrowings (Notes 13 and 25) Other current liabilities (Note 14) Total current liabilities NON-CURRENT LIABILITIES Long-term borrowings (Notes 13 and 25) Deferred tax liabilities (Notes 4 and 19) Net defined benefit liabilities (Notes 4 and 15) Other non-current liabilities Total non-current liabilities Total liabilities EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY (Notes 4 and 16) Share capital Common stock Capital surplus Retained earnings Legal reserve Unappropriated earnings Total retained earnings Other equity Exchange differences on translating foreign operations Unrealized loss on available-for-sale financial assets Total other equity Treasury shares NON-CONTROLLING INTERESTS Total equity TOTAL		2016 Amount % $ 536,998 11 64,638 1 157,311 3 25,968 1 182,072 4 1,110,750 23 72,994 2 1,219,127 25 76,887 2 14,218 - 3,460,963 72 26,747 1 1,017,650 21 145,008 3 49,327 1 16,187 - 87,923 2 1,342,842 28 $ 4,803,805 100 $ 629,345 13 4,622 - 388,867 8 243,963 5 5,156 - 40,836 1 175,643 4 419,199 9 1,907,631 40 481,867 10 13,912 - 73,840 2 5,722 - 575,341 12 2,482,972 52 1,800,000 37 319,573 7 163,053 4 100,810 2 263,863 6 (43,573) (1) (7,051 ) - (50,624 ) (1 ) (34,972 ) (1 ) 22,993 - 2,320,833 48 $ 4,803,805 100		2015
				Amount % $ 918,932 20 - - 84,122 2 10,008 - 202,099 4 730,582 16 95,856 2 1,217,128 26 59,558 1 18,609 1 3,336,894 72 26,747 1 959,280 21 157,583 3 59,158 1 59,194 1 57,765 1 1,319,727 28 $ 4,656,621 100 $ 977,178 21 15,383 - 267,030 6 254,435 6 5,036 - 49,705 1 107,057 2 344,040 7 2,019,864 43 206,744 5 679 - 136,623 3 9,710 - 353,756 8 2,373,620 51 1,800,000 39 337,206 7 163,053 4 2,800 - 165,853 4 (6,849) - (4,692 ) - (11,541 ) - (30,063 )(1 ) 21,546 - 2,283,001 49 $ 4,656,621 100

The accompanying notes are an integral part of the consolidated financial statements.

32 -

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

OPERATING REVENUE (Notes 4, 17 and 29) OPERATING COSTS (Notes 8 and 18) GROSS PROFIT OPERATING EXPENSES (Notes 4 and 18) Selling and marketing expenses General and administrative expenses Research and development expenses Total operating expenses PROFIT (LOSS) FROM OPERATIONS NON-OPERATING INCOME AND EXPENSES (Notes 4 and 18) Other income Other gains and losses Finance costs Share of profit of associates accounted for using the equity method Total non-operating income and expenses PROFIT (LOSS) BEFORE INCOME TAX INCOME TAX (EXPENSE) BENEFIT (Notes 4 and 19) NET PROFIT (LOSS) FOR THE YEAR OTHER COMPREHENSIVE INCOME (LOSS) Items that will not be reclassified subsequently to profit or loss: Remeasurement of defined benefit plans Income tax relating to items that will not be reclassified subsequently to profit or loss		2016 Amount % $ 3,697,479 100 2,462,981 67 1,234,498 33 550,806 15 461,830 12 75,374 2 1,088,010 29 146,488 4 60,611 2 (44,148) (1) (28,456) (1) 5,552 - (6,441 ) - 140,047 4 (43,022 ) (1 ) 97,025 3 (555) - (51 ) - (606 ) -		2015
				Amount % $ 3,136,687 100 2,229,556 71 907,131 29 591,618 19 306,446 10 76,010 2 974,074 31 (66,943 ) (2 ) 40,085 2 7,159 - (23,439) (1) - - 23,805 1 (43,138) (1) 1,048 - (42,090 ) (1 ) (12,337) (1) 1,957 - (10,380 ) (1 ) (Continued)

33 -

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

Items that may be reclassified subsequently to profit or loss: Exchange differences on translating foreign operations Unrealized loss on available-for-sale financial assets Other comprehensive income (loss) for the year, net of income tax TOTAL COMPREHENSIVE INCOME (LOSS) FOR THE YEAR NET PROFIT (LOSS) ATTRIBUTABLE TO: Owners of the Corporation Non-controlling interests TOTAL COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO: Owners of the Corporation Non-controlling interests EARNINGS (LOSS) PER SHARE (Note 19) Basic Diluted		2016 Amount % $ (37,885) (1) (2,359 ) - (40,244 ) (1 ) (40,850 ) (1 ) $ 56,175 2 $ 98,616 3 (1,591 ) - $ 97,025 3 $ 58,927 2 (2,752 ) - $ 56,175 2 $ 0.56 $ 0.56		2015
				Amount % $ (39,356) (1) (1,704 ) - (41,060 ) (1 ) (51,440 ) (2 ) $ (93,530 ) (3 ) $ (41,201) (1) (889 ) - $ (42,090 ) (1 ) $ (92,541) (3) (989 ) - $ (93,530 ) (3 ) $ (0.24 )


		$		$
		$		$
		$		$
		$		$
		$		$

The accompanying notes are an integral part of the consolidated financial statements.

(Concluded)

34 -

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars, Except Per Share Amounts)

BALANCE AT JANUARY 1, 2015 Appropriation of 2014 earnings Legal reserve Cash dividends distributed by the Corporation - NT$0.1 per share Balance after appropriation Net loss for the year ended December 31, 2015 Other comprehensive loss for the year ended December 31, 2015, net of income tax Total comprehensive loss for the year ended December 31, 2015 Issue of ordinary shares for cash Buy-back of ordinary shares Adjustments from changes in percentage of ownership of subsidiaries Issue of subsidiary's ordinary shares under employee share options Increase in non-controlling interests BALANCE AT DECEMBER 31, 2015 Cash dividends distributed from capital surplus Net profit (loss) for the year ended December 31, 2016 Other comprehensive loss for the year ended December 31, 2016, net of income tax Total comprehensive income (loss) for the year ended December 31, 2016 Buy-back of ordinary shares Increase in non-controlling interests BALANCE AT DECEMBER 31, 2016		Equity Attributable to Owners of the Company Other Equity Exchange Unrealized Gain Retained Earnings Differences on (Loss) on Unappropriated Translating Available-for-sale Non-controlling Legal Reserve Earnings Foreign Operations Financial Assets Treasury Shares Interests $ 161,309 $ 74,123 $ 32,413 $ (2,988) $ - $ (842) 1,744 (1,744) - - - - - (18,000 ) - - - - 163,053 54,379 32,413 (2,988) - (842) - (41,201) - - - (889) - (10,374 ) (39,262 ) (1,704 ) - (100 ) - (51,575 ) (39,262 ) (1,704 ) - (989 ) - - - - - - - - - - (30,063) - - (4) - - - - - - - - - 1,487 - - - - - 21,890 163,053 2,800 (6,849) (4,692) (30,063) 21,546 - - - - - - - 98,616 - - - (1,591) - (606 ) (36,724 ) (2,359 ) - (1,161 ) - 98,010 (36,724 ) (2,359 ) - (2,752 ) - - - - (4,909) - - - - - - 4,199 $ 163,053 $ 100,810 $ (43,573 ) $ (7,051 ) $ (34,972 ) $ 22,993	Total Equity $ 2,038,221 - (18,000 ) 2,020,221 (42,090) (51,440 ) (93,530 ) 363,000 (30,063) (4) 1,487 21,890 2,283,001 (17,633) 97,025 (40,850 ) 56,175 (4,909) 4,199 $ 2,320,833
	Common Stock Capital Surplus $ 1,470,000 $ 304,206 - - - - 1,470,000 304,206 - - - - - - 330,000 33,000 - - - - - - - - 1,800,000 337,206 - (17,633) - - - - - - - - - - $ 1,800,000 $ 319,573	Retained Earnings Unappropriated Legal Reserve Earnings $ 161,309 $ 74,123 1,744 (1,744) - (18,000 ) 163,053 54,379 - (41,201) - (10,374 ) - (51,575 ) - - - - - (4) - - - - 163,053 2,800 - - - 98,616 - (606 ) - 98,010 - - - - $ 163,053 $ 100,810

The accompanying notes are an integral part of the consolidated financial statements.

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ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015

(In Thousands of New Taiwan Dollars)

CASH FLOWS FROM OPERATING ACTIVITIES Profit (loss) before income tax Adjustments for: Depreciation expenses Amortization expenses Impairment loss recognized (reversal of impairment loss) on accounts receivable Finance costs Interest income Compensation cost of employee share options Share of profit of associates Loss on disposal of property, plant and equipment, net Gain on disposal of available-for-sale financial assets, net Gain on disposal of investments accounted for using the equity method Reversal of impairment loss on non-financial assets Changes in operating assets and liabilities Financial assets held for trading Notes receivable Accounts receivable (including - long-term receivables) Other receivables Inventories Prepayments Other current assets Notes payable Accounts payable Other payables Provisions Other current liabilities Net defined benefit liabilities Cash generated from operations Interest received Interest paid Income tax paid Net cash generated from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Purchase of available-for-sale financial assets Proceeds from sale of available-for-sale financial assets Purchase of debt investment with no active market Proceeds from redemption of debt investments with no active market Net cash outflow on acquisition of subsidiaries Proceeds from sale of investments accounted for using the equity method	2016 $ 140,047 87,101 6,997 8,631 28,456 (6,526) - (5,552) 24 (1,544) (4,259) (26,319) (64,638) 20,027 (358,806) 27,188 26,565 (40,079) 1,375 (10,761) 121,837 (10,573) (8,869) 97,107 (63,389 ) (35,960) 6,504 (28,355) (16,822 ) (74,633 ) (422,826) 339,393 (15,960) - (360,719) 370,530	2015 $ (43,138) 76,601 1,378 (19,104) 23,439 (1,561) 1,487 - 3,786 (3,641) - (23,173) - 31,646 308,695 (83,453) 98,075 (5,296) 10,921 12,324 (76,480) 9,814 15,967 154,395 (1,449 ) 491,233 1,541 (22,440) (67,146 ) 403,188 (113,237) 75,704 - 1,261 - -

(Continued)

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ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015

(In Thousands of New Taiwan Dollars)

Payments for property, plant and equipment Proceeds from disposal of property, plant and equipment Decrease (increase) in refundable deposits Payments for intangible assets Decrease (increase)in non-current assets Increase in prepayments for equipment Net cash used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES Increase (decrease) in short-term borrowings Proceeds from long-term borrowings Repayment of long-term borrowings Increase in guarantee deposits received Decrease in other non-current liabilities Cash dividends paid Issue of ordinary shares for cash Payments for buy-back of ordinary shares Increase (decrease) in non-controlling interests Net cash generated from (used in) financing activities EFFECTS OF EXCHANGE RATE CHANGES ON THE BALANCE OF CASH HELD IN FOREIGN CURRENCIES NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR	2016 $ (130,835) 1,939 (3,970) (1,134) (14,730) (7,478 ) (245,790 ) (347,833) 505,024 (156,930) 5,682 (9,670) (17,633) - (4,909) 4,199 (22,070 ) (39,441 ) (381,934) 918,932 $ 536,998	2015 $ (60,469) 4,952 19,382 (6,587) 3,846 (12,993 ) (88,141 ) 443,808 - (706,516) 40 - (18,000) 363,000 (30,063) 21,890 74,159 (37,607 ) 351,599 567,333 $ 918,932

The accompanying notes are an integral part of the consolidated financial statements.

(Concluded)

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[Appendix IV]

Anderson Group (before amendment)

Chapter I General Provision

Article I: The Company is duly incorporated in accordance with the Company Act and bears the title of Anderson Group.
Article II: The Company is engaged in the following business:
I. CB01010 Machinery and Equipment Manufacturing.
II. CB01990 Other Machinery Manufacturing Not Elsewhere Classified.
III. CN01010 Furniture and Fixtures Manufacturing.
IV. F113010 Wholesale of Machinery
V. F113990 Wholesale of Other Machinery and Equipment.
VI. F105050 Wholesale of Furniture, Bedclothes, Kitchen Equipment and Fixtures.
VII. F106010 Wholesale of Ironware.
VIII. F107200 Wholesale of Chemical Raw Material.
IX. F213080 Retail Sale of Machinery and Equipment.
X. F213990 Retail Sale of Other Machinery and Equipment.
XI. F205040 Retail Sale of Furniture, Bedclothes, Kitchen Equipment, and Fixtures.
XII. F206010 Retail Sale of Ironware.
XIII. F207200 Retail Sale of Chemical Raw Material.
XIV. E604010 Machinery Installation Construction.
XV. F401010 International Trade
XVI. JE01010 Rental and Leasing Business
XVII. C701010 Printing.
XVIII. ZZ99999 All business items that are not prohibited or restricted by law, except those that are subject to special approval.
Article III: In case the Company is a limited liability shareholders of another company, the total investment of which shall not be governed by Article 13 of the Company Act where total investment shall not exceed 40% of the paid-in capital.

Article III-I:

The Company may act as guarantor in favor of a third party.
Article IV: The Company is headquartered in Taipei, and may set up domestic and overseas
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branches at the resolutions of the Board where necessary. Article V: Deleted.

Chapter II Shares of Stock Article VI: The Company has stated capital of TWD3 billion and are evenly distributed into 300 million shares at TWD10/share. The shares will be issued by the Board in series under authorization. Article VII: The Company shall issue registered shares in digital form with registration at Taiwan Depository and Clearing Corporation. The Company may also prepare hard copy of share certificates on condition that each certificate shall be affixed with the authorized signatures or seals of at least three (3) Directors subject to the due process of certification before offering. Article VIII: The transfer of shares is prohibited in a period of 60 days prior to a scheduled regular session of the General Meeting of Shareholders, a period of 30 days prior to a scheduled special session of the General Meeting of Shareholders, or a period of five (5) days prior to the dividend and interest payment day or any other day set for benefit payment. Article VIII-I: Unless the Securities and Exchange Act provides otherwise, the assignment, succession, donation, pledge, missing, damage of shares or any other matters related to share registration and transfer, shall be governed by the Regulations Governing the Administration of Shareholder Services of Public Companies.

Chapter III General Meeting of Shareholders
Article IX: The General Meeting of Shareholders shall be convened in regular session and special session. Regular session shall be convened once a year within six (6) months after the end of the fiscal period. Special sessions may be convened at any time where necessary.
Article X: In case specific shareholder cannot attend the General Meeting of Shareholders in person, such shareholder may use the document prepared by the Company for authorization of agent to appoint a proxy to attend the meeting with specifying the scope of power of attorney. If particular party is appointed as the proxy of two (2) or more shareholders, the total votes cast by this proxy shall not exceed 3% of the votes representing the total quantity of outstanding shares unless the proxy is a share registrar approved by a trust firm or the competent authority of securities or the votes in excess of 3% of the votes representing the total outstanding shares will not be counted.
Article XI: Shareholders shall be entitled to one vote for each share in holding unless under the circumstances as prescribed in Article 179 of the Company Act.
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Article XII: Unless the Company Act provides otherwise, the resolution of the General Meeting of Shareholders shall be made by a session with the presence of shareholders representing more than half of the total outstanding shares and under a simple majority of shareholders in session.
Chapter IV Directors and Supervisors
Article XIII: The Company shall established five (5) to seven (7) seats of Directors and three (3) seats of Supervisors each with a term of office for three (3) years. Directors and Supervisors shall persons of legal competence and elected by the General Meeting of Shareholders, and may assume a second term of office if reelected. Of all the seats for Directors, at least two (2) shall be reserved for Independent Directors and the ratio of these seats shall not fall below one-fifth of the total seats for Directors. Independent Directors are elected from candidates under the nomination system. The professional qualification, limitation of shareholding and position in other business entities, determination of independence, method of nomination and election, and other matters of compliance shall be governed by the rules and regulations of the competent authority of securities.
Article XIV: Unless the Company Act provides otherwise, resolutions of the Board shall be made by a session with the presence of at least half of the Directors and a simple majority of the Directors in session. Directors who cannot attend the session of the Board in person may appoint another Director as proxy with the issuance of a power of attorney. Each Director may act as the proxy of only one other Director.
Article XV: The Directors shall organize into the Board of Directors and a Chairman shall be elected among the Directors in a session with the presence of at least two-thirds of the Directors and a simple majority of the Directors in session. The Chairman shall be the deputy agent of the Company externally.
Article XVI: In the absence of the Chairman or the Chairman is unable to perform its duties, one (1) Director shall be appointed by the Chairman as the proxy, or elected among the Directors as the proxy of the Chairman.
Article XVII: The remuneration to the Directors and Supervisors shall be determined by the Board under authorization, and shall commensurate with the level of participation of the Directors and Supervisors in the operation of the Company or the contribution value to the Company, with reference to industry standard at home and abroad.
Article XVII-I: The Board shall call for its regular session with seven (7) days of notice to all Directors and Supervisors or call for special session at any time in case of an emergency.

The notice of meeting shall be made in correspondence, e-mail or fax with the reason for the session specified therein.

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Chapter V Managers

Article XVIII: The Company shall establish the position for a General Manager and as number of positions of Deputy General Managers, and the appointment, dismissal, and remuneration of whom shall be governed by Article 29 of the Company Act.

Chapter VI Accounting

Article XIX: The fiscal period of the Company starts on January 1 and ends on December 31 of each calendar year.
At the end of the fiscal period, the Board shall prepared (I) Operation Highlight; (II) Financial Statements; and (III) Proposal for Distribution of Earnings or Write-Off loss carryforward, and refers to the Supervisors for review before presenting before the General Meeting of Shareholders for ratification.
Article XX: The Company shall appropriate 1%~10% of its earnings before taxation and before the deduction for remuneration to employees and Directors and Supervisors as remuneration to employees and Directors and Supervisors as determined by the Board, which may be paid in stock or cash. The recipients shall include employees of subsidiaries meeting specific conditions. The Company may appropriate no more than 3% of the aforementioned amount of earnings as remuneration to Directors and Supervisors at the resolution of the Board and paid in cash only. The proposal for remuneration to employees and Directors and Supervisors shall be reported to the General Meeting of Shareholders. The Company shall appropriate the earnings for write-off loss carryforward, if applicable.
The Company shall consider the unpredictable and competitive environment of the industry in making its dividend policy. While the Company is at its stage of stable growth in the corporate life cycle, and in consideration of the capital requirement in the future and long-term financial planning, the Company determines to appropriate 10% of its surplus net of the payment of corporate income tax and appropriation for write-off loss carryforward as required by law as legal reserve, and the recognition or reversal of special reserve as required by the competent authority. If there is still a balance, the Company shall pool up with the undistributed earnings at beginning as distributable earnings payable at the proposal of the Board subject to the resolutions of the General Meeting of Shareholders.

Shareholder dividend may be paid in cash or stock while cash dividend shall not be released if falls below TWD0.1per share. Cash dividend shall account for 30% ~100% of the total dividend while stock dividend shall account for 0%~70% of total dividend. The ratio of the aforementioned earnings for distribution shall be subject to adjustment pending on the actual profit position and availability of funds

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at the resolution of the General Meeting of Shareholders.

	Chapter VII Miscellaneous
Article XXI:	Deleted.
Article XXII:	Anything not covered by the Articles of Incorporation shall be governed by the
	Company Act.
Article XXIII:	The Articles of Incorporation were instituted on July 6, 1972.
	Amendment of the 1stinstance was made on July 13, 1976.
	Amendment of the 2ndinstance was made on July 10, 1979.
	Amendment of the 3rdinstance was made on June 22, 1980.
	Amendment of the 4thinstance was made on April 6, 1984.
	Amendment of the 5thinstance was made on September 5, 1984.
	Amendment of the 6thinstance was made on April 6, 1985.
	Amendment of the 7thinstance was made on November 24, 1986.
	Amendment of the 8thinstance was made on September 25, 1992.
	Amendment of the 9thinstance was made on May 18, 1993.
	Amendment of the 10thinstance was made on February 1, 1994.
	Amendment of the 11thinstance was made on August 10, 1994.
	Amendment of the 12thinstance was made on April 28, 1995.
	Amendment of the 13thinstance was made on February 1, 1996.
	Amendment of the 14thinstance was made on May 5, 1996.
	Amendment of the 15thinstance was made on November 9, 1996.
	Amendment of the 16thinstance was made on May 2, 1998.
	Amendment of the 17thinstance was made on June 8, 1999.
	Amendment of the 18thinstance was made on June 17, 2000.
	Amendment of the 19thinstance was made on May 8, 2001.
	Amendment of the 20thinstance was made on June 20, 2002.
	Amendment of the 21stinstance was made on June 25, 2004.
	Amendment of the 22ndinstance was made on June 23, 2005.
	Amendment of the 23rdinstance was made on June 23, 2006.
	Amendment of the 24thinstance was made on June 19, 2008.

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Amendment of the 25[th] instance was made on June 25, 2010. Amendment of the 26[th] instance was made on June 24, 2011. Amendment of the 27[th] instance was made on June 25, 2013. Amendment of the 28[th] instance was made on June 30, 2015. Amendment of the 29[th] instance was made on June 6, 2016.

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[Appendix V]

Anderson Group

Parliamentary Procedure for General Meeting of Shareholders (before amendment)

Passed by the Regular Session of General Meeting of Shareholders

Held on June 20, 2002

Article I: The General Meeting of Shareholders shall be convened in accordance with This Procedure unless the law specified otherwise.
Article II: A registry shall be prepared for the shareholders to sign-in at the General Meeting of Shareholders, or, sign-in shall be replaced by the surrender of the attendance cards by the shareholders.
The representation of shares to the meeting shall be counted on the basis of the sign-in record or the attendance cards surrendered.
Article III: The attendance and decision of the General Meeting of Shareholders shall be based on the quantity of shares represented in the session.
Article IV: General Meeting of Shareholders shall be held at a location in the area where the principal place of business of the Company is located or a location convenient for the shareholders for commuting and suitable for such purpose. The time of meeting should preferably be 9:00 am or 03:00 pm.
Article V: The Chairman shall preside over the General Meeting of Shareholders if the meeting is called by the Board. In the absence of the Chairman or the Chairman is unable to perform its duties, the Vice Chairman shall act on behalf of and in the name of the Chairman. If no position of Vice Chairman is established, or in the absence of the Vice Chairman or the Vice Chairman is unable to perform its duties, the Chairman shall appoint one (1) Executive Director to preside over the meeting. If no seat of Executive Director is established, the Directors shall appoint one among themselves for such purpose. If the Chairman did not appoint a proxy, the Executive Directors or Directors shall appoint one (1) person among themselves to preside over the meeting.
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A session may be called for by a third party entitled to call for General Meeting of Shareholders other than the Board in which case such third party shall preside over the meeting.
Article VI: The legal attorney, certified public accountants retained by the Company or related personnel may attend the General Meeting of Shareholders as observers.
Administrative personnel of the General Meeting of Shareholders shall wear arm badge or ID badge on the scene of the meeting.
Article VII: The whole session shall be tracked on record by voice recording or videotaping and this record shall be kept for at least one (1) year.
Article VIII: The Chairman shall announce the General Meeting of Shareholders is in session at the exact time set for the session. However, the Chairman may announce the postponement of the session the shareholders who are present cannot represent more than half of the total outstanding shares and the session may be postponed twice and the total time lapse shall not exceed one (1) hour. The Chairman shall make provision resolution pursuant to Article 175 of the Company Act if the shareholders who are present in the session still cannot represent more than half of the total outstanding shares but exceeds more than one-third of the total outstanding shares.
If shareholders attending the session can represent more than half of the total outstanding shares before the session is adjourned, the Chairman shall refer the provisional resolutions previously made to the floor for a new round of decision pursuant to Article 174 of the Company Act.
Article IX: If the session of the General Meeting of Shareholders is convened by the Board, the Board shall prepare the agenda and proceed as scheduled in the agenda. The agenda cannot be change without the resolution of the General Meeting of Shareholders.
The preceding paragraph is applicable to a session called for by an entitled third party.
Before the end of the discussion and resolution of the motions as arranged in the agenda (including extemporary motions) as stated in the preceding two paragraphs,
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the Chairman cannot announce for the adjournment of the session without a resolution.

After the adjournment of the session, shareholders cannot appoint a chairman to hold another session at the original place of meeting or another venue unless the Chairman acts in violation of This Procedure in announcing for the adjournment of the session that the shareholders representing more than half of the outstanding shares in the session may appoint another person as the chairman to continue the session.

Article X: Shareholders are required to put down a brief summary of the opinion they wanted to express in the General Meeting of Shareholders and shareholder account number (or the attendance pass number) on the slip provided. The Chairman shall determine the order of the forum in the meeting.
If specific shareholders just put down a brief summary on the slip provided without presenting the opinion on the floor, it shall be deemed no opinion has ever been expressed. If the content of the opinion inscribed in the slip is not relevant with the content of opinion actually expressed, the latter shall stand.
No shareholders may interfere another shareholder speaking on the floor unless under the consent of the Chairman and the shareholder on the floor. The Chairman shall restrain any shareholder who violates this rule.
Article XI: Each shareholder may express opinion only twice on particular motion unless at the consent of the Chairman. The time for each instance of expression is limited to 5 minutes.
The Chairman shall restrain any shareholder who violates this rule.
Article XII: Institutional shareholder may appoint only one representative to attend the General Meeting of Shareholders. If two or more representatives were appointed to attend the meeting, only one representative may express opinion on particular motion.
Article XIII: The Chairman shall respond to the opinions expressed by shareholders in the General Meeting of Shareholders in person or appoint designated personnel to respond the opinions.
Article XIV: The Chairman may conclude the discussion on particular motion if it is high time
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that decision should be made, and proceed to voting for resolutions.

Article XV: The Chairman shall appoint designated personnel to observe and count the votes cast on each motion. The observers of balloting shall also be shareholders. The outcome of voting shall be announced on the scene and tracked on record.
Article XVI: The Chairman may announce for recess in the duration of the session. Article XVII: Resolutions of motions shall be made by a simple majority of the shareholders in session that represented more than half of the votes unless the Company Act or the Articles of Incorporation specified otherwise.
The Chairman may ask if there is any adverse opinion on particular motion, and such motion shall be deemed passed by balloting if no adverse opinion is expressed by the shareholders.
Article XVIII: The Chairman may determine the priority of balloting on specific motion with amendment or substitute. If either the original motion, or its amendment and substitute are being passed by the shareholders, it shall be deemed favorable action taken in favor of the original motion, the amended motion, or the substitute that the remainders shall be deemed vetoed and no further balloting will be necessary.
Article XIX: The Chairman may direct the prefects (or security guards) to maintain order of the venue for the meeting. The prefects (or security guards) shall wear an arm badge inscribed with the wording of “prefect” when performing their duties of maintaining order of the meeting venue.
Article XX: This Procedure shall come into full force at the resolution of the General Meeting of Shareholders. The same procedure is applicable to any amendment thereto.
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[Appendix VI]

Anderson Group

Procedure for Loaning of Funds (Before Amendment)

This Procedure was passed by the Board on December 24, 2013

Ratified by General Meeting in a regular session held on June 6, 2014 and effective on the same day

Article I: The loaning of funds to a third party by the Company shall be governed by This Procedure.
Article II: Pursuant to Article XV of the Company Act, the Company cannot finance its shareholders of any third party unless any of the following is applicable:
I. Companies or business entities trading with the Company.
II. Companies or business entities that have the needs of short-term financing.
Short-term as referred to shall mean a period of one (1) year. If the operation period of the Company is longer than one (1) year, the operation period shall stand.
Financing among foreign companies wholly-owned by the Company with 100% voting right shall not waived from the requirements in II but still be subject to the regulation of limit and the term as prescribed in Article IV and Article V.
Article III: Financing with business partners shall be governed by Article IV. Financing for short-term need shall be subject to the following conditions:
I. Companies where the Company directly or indirectly holds more than 50% of their shares with voting rights and which are in need for retirement of bank loans, procurement of equipment or as working capital.
II. Investees of the Company by direct or indirect holding of more than 20% of their stakes which are in need for retirement of bank loans, procurement of equipment or as working capital.
Article IV: The overall limit and limit for particular borrower in financing.
The overall limit of financing in favor of the others by the Company shall not - 48 -

exceed 40% of the net worth of the Company as stated in the audited or reviewed financial statements of the Company covering the most recent period. The limit for financing particular borrower shall be varied with the reasons of financing which are specified below:

I. The limit for business partners of the Company may not exceed the amount of sale or purchase in the previous year or in current year at the time of financing, whichever is higher.
II. The limit for short-term financing need to particular borrower may not exceed 20% of the net worth of the Company as stated in the audited or reviewed financial statements of the Company covering the most recent period.

The overall financing among foreign companies wholly-owned by the Company with 100% voting right and for particular borrower shall not exceed 100% of the net worth of the Company.

Net worth as referred to in This Procedure shall be the shareholders’ equity attributable to the parent company as stated in the balance sheet prepared in accordance with the Criteria for Compilation of Financial Statements by Securities Issuers.

Article V: The General Management of the Company shall conduct cautious review and assessment in financing the others and present an opinion, including:

I. The borrower, the amount, the reasons, the condition for discharge, and the term of financing.
II. Assess on the necessity and rationality of financing.
III. Assess the credit standing and operation status of the borrower.
IV. Assess the effect of financing on the operation risk, financial position, and shareholders’ equity of the Company.
V. The necessity of demand for collaterals, and appraisal of the collaterals.

The aforementioned opinions shall be presented to the General Manager for approval subject to the finalization of the Board. Decision in this matter cannot be

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made by an authorized person. In addition, the opinions from the Directors shall be considered. The opinions in agreement or disagreement shall be tracked as minutes of meeting of the Board on record.

The financing between the Company and subsidiaries, and among the subsidiaries, shall be subject to resolutions of the Board as mentioned in preceding paragraphs. The Chairman may be authorized to make decision for financing particular borrower at specific amount and credit limit for several drawdown or as revolving credit as determined by the Board.

Specific limit as referred to shall be the authorized limit for financing particular enterprise by the Company or a subsidiary, which shall not exceed 10% of the net worth of the Company or the subsidiary in the financial statement covering the most recent period, further to the requirement as stated in II of Article IV.

Each transaction of financing of direct or indirect wholly-owned foreign subsidiaries of the Company with 100% voting right shall not exceed a period of two (2) years.

Subsidiaries and parent company as referred to in This Procedure shall be determined by the definition stated in the Criteria for Compilation of Financial Statements by Securities Issuers.

Article VI: The General Management of the Company shall conduct routine assessment on the changes in the financial position, operation status, credit standing, and other conditions of the borrowers as well as the changes in the value of the collaterals after the drawdown. In case of significant change, report to the General Manager and related functional units of the Company at once for action.

When the borrowers retire the loans at maturity or before maturity, the principal and accrued interest shall be settled in lump sum before returning the promissory notes to the borrowers or removal of the lien on the collaterals.

Article VII: The interest for the loans shall be calculated at floating rate subject to adjustment in line with the change in the cost of capital to the Company. Interest may be adjusted as proposed by the General Management subject to the approval of the General Manager.

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Article VIII: The General Management of the Company shall declare the balance of outward loans of the Company and the subsidiaries of the month on or before the 10[th] day of the next month. If the balance of outward loans meets any of the following standards, declare within two (2) days after the day of deed:
I. The amount of financing of the Company and the subsidiaries to the others exceeds 20% of the net worth of the Company as stated in the financial statements of the Company covering the most recent period.
II. The financing balance of the Company and the subsidiaries to particular enterprise exceeds 10% of the net worth of the Company as stated in the financial statements of the Company covering the most recent period.
III. Additional amount of financing of the Company or the subsidiaries exceeds TWD 10 million and exceeds 2% of the net worth of the Company as stated in the financial statements covering the most recent period.

Declaration as mentioned shall be the entry of related information into the designated website of Financial Supervisory Commission, the “MOPS”.

Day of deed as referred to in This Procedure shall be the transaction day, payment day, Board resolution day, or any other days on which the counterparty of trade and transaction amount could be determined, whichever comes first.

If the companies where the Company directly or indirectly holds more than 50% of their stakes with voting rights are not domestic public companies, declaration as stated in III shall be made by the Company.

Article IX: As per the requirement of the competent authority of securities, the General Management of the Company shall establish a record book for tracking the borrowers, the amount of loans, the Board resolution date or Chairman approval date, the day of drawdown, and other items for precaution in full detail for record.
Article X: The Company shall assess and recognize for sufficient provision for bad debts depending on the status of financing, and disclose in the financial statements. In addition, the Company shall also provide related information for the certified public accountants for necessary auditing so as to present appropriate auditor’s report.
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Article XI: The internal auditing function of the Company shall conduct routine audit and assess the implementation of the aforementioned requirements, and keep record on the findings in writing. If significant violations are discovered, report to the Supervisors in writing at once further to reporting to the Chairman for disciplinary action.
Article XII: For financing by companies that the Company directly and indirectly holds more than 50% of their stakes with voting rights in favor of the others, they shall institute the procedures for loaning of funds and shall conduct self-assessment on the amount of loan and the transactions to ensure compliance with This Procedure. The aforementioned self-assessment reports of the subsidiaries shall be subject to the review of the internal auditing function of the Company.
Article XIII: In the event of situation change, to the extent that the borrowers no longer meet the standard in This Procedure or the amount of loans exceeds the limits, prepare a plan for corrective action, and present the plan to the Supervisors and take action as planned.
Article XIV: This Procedure shall be passed by the Board and circulated to the Supervisors, and presented before the General Meeting of Shareholders for ratification so as to come into effect. The same procedure is applicable to any amendment thereto.
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[Appendix VII]

Anderson Group Procedure for Acquisition or Disposition of Assets (Before amendment)

This Procedure was passed by the Board in a session held on March 25, 2014. Ratified by the General Meeting of Shareholders in a regular session held on June 6, 2014 and was effective on the same day.

Article I: This Procedure is instituted pursuant to Article 36-1 of the Securities and Exchange Act and the requirements of Financial Supervisory Commission.
Article II: Scope of assets

This Procedure shall be applicable to assets falling within scope specified below:

I. Investment in stocks, government bonds, corporate bonds, bank debentures, fund securities, depository receipts, call (put) warrants, beneficiary certificates, and asset-back securities.
II. Property (including lands, housing and structures, investment property, right of land use, inventory of the construction industry) and equipment.
III. Membership cards.
IV. Patents, copyrights, trademarks, franchise, and other intangible assets.
V. Rights of debts to financial institutions (including receivables, discount and loan for inward remittance, and overdue loans).
VI. Derivatives.
VII. Assets from corporate merger, spinoff, acquisition, or acceptance of assigned shares under law.
VIII. Other major assets.

Article III: Assessment and operation procedure

I. In the assessment of assets for acquisition or disposition, consider the purpose, the subject matter, the counterparty, transfer price, terms, and conditions of payment, and reference price in the transaction of acquisition or disposition. Submit an analysis report with recommendation to the competent
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authority of the Company for approval.

II. The procedure for acquisition and disposition of assets shall be relevant with the requirements of the internal control system of the Company.

Article IV: Procedure for decision-making on the terms and conditions of trade

I. Determination of price and reference
(I) For the acquisition or disposition of securities traded at the centralized market or OTC market, decision is made because of the transaction price at the point of transaction.
(II) For the acquisition or disposition of securities not traded at the centralized market or OTC market, consider the net value per share, profitability, prospect, market interest rate, coupon rate of bonds, and credit standing of the debtors, and also the current transaction price when making decision.
(III) For the acquisition or disposition of property and other fixed assets, consider the announced present value, appraised present value, the transaction price of property in the immediate area, and through inquiry, comparison of offering, bargaining, or tender offer in making decision. If all other factors satisfy the standards in This Procedure, retain professional appraisers to conduct an appraisal.
II. Gate Approval
The Chairman is authorized to make decision of the acquisition or disposition of assets under TWD30 million. For acquisition of financial products, the Chairman shall report to the nearest session of the Board. If the amount exceeds TWD30 million, the prior approval of the Board is necessary. In addition, the opinions from the Independent Directors shall be considered fully. The opinions of Independent Directors in agreement or disagreements and the reasons shall be tracked as minutes of Board meeting on record.

Article V:

The Executor

The General Management shall be the executor of long and short-term securities investment. The users and General Management shall be the joint executor of

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property and other fixed assets.

Article VI: Acquisition of appraisal report on assets
I. The acquisition or disposition of property or equipment
- With the exception of transaction with government entities, commissioning of construction on proprietary land, commissioning of construction on leased lands, or, the acquisition or disposition of machinery and equipment for business purpose, any other transactions exceeding 20% of the paid-in capital or TWD300 million shall be accompanied by an appraisal report issued by professional appraisers before the day of deed and in conformity to the following:
- (I) If specific transaction shall be based on limited price, designated price or special price due to special reasons, the approval of the Board in advance will be necessary. The same procedure is applicable for any change in the condition of transaction in the future.
- (II) Transactions exceeding TWD1 billion shall be accompanied by the appraisal reports issued by at least two (2) professional appraisers.
- (III) If any of the following is applicable to the appraisal results of the professional appraisers, consult with a certified public accountant and proceed to the Statement of Auditing Standard No. 20 issued by the Accounting Research and Development Foundation (hereinafter referred to as “ARDF”), and present an opinion on the reason of the difference and the appropriateness of the transaction price in concrete term:
  1. The difference between the appraisal result and the transaction amount is greater than 20% of the transaction amount.
  2. The difference between the appraisal results from two (2) or more professional appraisers is greater than 10% of the transaction price.
(IV) The date of the appraisal reports issued by the professional appraisers and the contract signing date shall not fall apart for more than three (3) months. If the announced present value in the same period is applicable and the duration is
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less than six (6) months, the original professional appraisers shall express an opinion in writing.

The professional appraisers and their appraisal staff, the certified public accountants, legal attorneys or securities underwriters that presented the professional opinions shall not be related parties of the Company.

II. The acquisition or disposition of securities

In the acquisition or disposition of securities, the Company shall obtain the audited or reviewed financial statements of the target companies covering the most recent period before the day of deed as reference for assessing the transaction prices. If any of the following is applicable, and the transaction amount exceeds 20% of the paid-in capital of the Company or TWD300 million, consult a certified public accountant to present an opinion on the rationality of the price before the day of deed. If the certified public accountant elected to adopt the report of an expert, proceed to Statement of Auditing Standard No. 20 issued by ARDF unless the securities involved have open quotation in an active market, or the Financial Supervisory Commission required otherwise.

III. The acquisition or disposition of membership cards or intangible assets

In the acquisition or disposition of membership cards or intangible assets, if the transaction amount exceeds 20% of the paid-in capital of the Company or TWD300 million, consult a certified public accountant to present an opinion on the rationality of the price before the day of deed, and proceed to Statement of Auditing Standard No. 20 issued by ARDF unless the transaction is made with government entities.

IV. The acquisition or disposition of assets through court auction

In the acquisition or disposition of assets through court auction, the certification documents issued by the court may be used as a substitute for the appraisal report or opinion of the certified public accountant.

Article VI-I: The calculation of the transaction amount as stated in the preceding three (3) articles shall be based on the requirement inscribed in Article XVIII-II of This

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Procedure. The period of one (1) year as referred to shall be the duration from the day of deed moving backward for one (1) year in retrospect. The portion that does not require appraisal report from professional appraisers or the opinion of certified public accountant as stated in This Procedure could be excluded from calculation.

Article VII: For the acquisition or disposition of property between the Company and related parties, or the acquisition or disposition of other assets beyond property between the Company and related parties the transaction amount of which exceeds 20% of the paid-in capital, 10% of the total assets of the Company, or TWD300 million, forward the following information and materials to the Board for resolution and the ratification of the Supervisors before proceeding to entering into agreement and effecting payment except for the trading of government bonds, RP-RS bonds, the subscription or redemption of domestic money market funds:

I. The purpose, necessity, and expected result of acquisition or disposition.
II. The reason for choosing related parties as the counterparties of trade.
III. Information for supporting the rationality of the terms and conditions of trade in the assessment inscribed in Article XV and Article XVI.
IV. The original date and price of acquisition by the related party, the counterparty of trade, and the relation between the counterparty and the related party and the Company.
V. The projection of cash flow on a monthly basis in the year ahead from the month of entering into the agreement with assessment on the necessity of trade and the rationality of the use of fund.
VI. The appraisal reports issued by professional appraisers or the opinion from certified public accountant as stated in the previous article.
VII. The limitation and other important notice related to this transaction.

The calculation of the transaction amount shall be based on the requirement inscribed in Article XVIII-II of This Procedure. The period of one (1) year as referred to shall be the duration from the day of deed moving backward for one (1) year in retrospect. The portion that does not require appraisal report from

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professional appraisers or the opinion of certified public accountant as stated in This Procedure could be excluded from calculation.

For the acquisition or disposition of machinery and equipment for business purpose between the Company and the subsidiaries or between subsidiaries, the Chairman shall be authorized to make decision if the transaction amount falls below TWD30 million and shall report to the Board in the nearest session for ratification.

The acquisition or disposition of assets between the Company and related parties exceeding 10% of the total assets or the Company shall be supported by the appraisal reports issued by professional appraisers or the opinion of certified public accountant in advance is necessary further to the required procedure for decision-making and the assessment of the rationality of the terms and conditions of trade.

The calculation of transaction amount shall be made in accordance with Article XVIII-II of This Procedure.

Both the de jure and de facto relationship between the Company and related parties shall be considered in determining if the counterparty is a related party.

Article VIII:

In acquiring property from related parties, assess the rationality of the cost of transaction in the following methods:

I. Add necessary cost of capital and the cost to be borne by the buyer under law to the price for transaction with related parties. Necessary cost of capital is based on the weighted average interest rate for bank loans to the Company in the year of acquiring the asset up to the upper limit of interest rate for loans offered by non-financial institutions as announced by Ministry of Finance.
II. If the related party has pledged the subject asset to a financial institution as collateral for loan, it should be the total appraisal value on the subject asset for lending. If the actual drawdown from the financial institution on the subject assets exceeds 70% of the total appraisal value on an accumulative basis and the loan period is longer than one (1) year, or the financial
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institution is a related party to one side of the parties in the transaction, this provision shall be waived.

For joint procurement of the same subject land and premises, the cost of transaction could be assessed separately on lands and premises in any of the aforementioned methods.

The Company shall assess the cost of the property for acquiring property from related parties pursuant to Item I and II of this article, and shall consult a certified public accountant for review and express substantive opinion.

If any of the following is applicable to the acquisition of property from related parties, proceed to Article VII while the requirements of the preceding three (3) paragraphs could be waived:

I. The related parties acquired the property through succession or donation.
II. The time at which the related parties acquired the property is longer than five (5) years ago from the contract date.
III. Acquisition of property under an agreement with related parties for joint venture in construction, or commissioning of construction on proprietary lands, commissioning of construction on leased land with related parties.

Article VIII-I: If the appraisal result as stated in I and II of the previous article falls below the transaction price, proceed to Article VIII-II. If under any of the following circumstances with the presentation of objective evidence and opinions of the professional appraisers and certified public accountants on rationality of the transaction, this provision could be waived;

I. The related party acquired empty land or lease land for construction shall proof with evidence for meeting any of the following conditions:
(I) Empty land shall be subject to assessment under the aforementioned methods. Premises shall be assessed on the basis of adding reasonable profit for construction to the cost of construction of the related party and the sum of which exceeds the actual price of transaction. Reasonable profit for construction shall be the average gross margin of the construction segment of the related party in the last three (3) years
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or the gross margin for the construction industry recently announced by the Ministry of Finance, whichever is lower.

  - (II) Other cases of successful transactions on other stories of the same building or in the immediate area with non-related parties, with similar size by floor area, and the conditions of trade are relevant and justifiable for other stories of the same building or in the immediate area under the common practice and customs of real estate trade.

  - (III) Other cases of successful lease on other stories of the same building or in the immediate area with non-related parties, and the conditions are relevant and justifiable for other stories of the same building or in the immediate area for leasing under the common practice and customs.

II. The acquisition of property from related parties by the Company with conditions of trade relevant with other cases of successful transactions on other stories of the same building or in the immediate area with non-related parties with similar size by floor area.
- Successful cases in immediate area shall be the transactions in the same block or adjacent block and within 500 meter in perimeter from the subject asset or similar to the announced present value. Similar floor size shall be the successful cases of transactions with non-related parties with floor areas not falling below 50% of the subject asset. Within one (1) year shall be the duration of one (1) year from the day of acquiring the property moving backward for one (1) year in retrospect.
Article VIII-II: If the appraisal result falls below the transaction price, proceed to the following:
I. Recognize the difference between the transaction price of property and the estimated cost as special reserve pursuant to Article 41-1-(1) of the Securities and Exchange Act, and shall not distribute or capitalize the difference into new shares. If the investees of the Company accounted for under the equity method are public companies, recognize for special reserve in proportion to shareholding pursuant to Article 41-1 of the Securities and Exchange Act.
II. Supervisors shall proceed to Article 218 of the Company Act.
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III. Report the situations of I and II to the General Meeting of Shareholders with disclosure of the detail of transactions in the annual report and prospectus.
The aforementioned special reserve so recognized may be used on condition that the asset acquired has been recognized for impairment, or disposed, or appropriately compensated or recovery to original condition, or with other evidence for justifying the condition and at the consent of Financial Supervisory Commission.

If there is evidence implicating that the acquisition of property from related parties by the Company was conducted not in arm’s length, proceed to II of this article.

Article IX: The Company may engage in derivative trade with attention to risk management and auditing for control as specified below:
I. The principle and policy of trade:
- (I) Type of trade: the Company may engage in derivative trade including forwards contracts, option contracts, futures contracts, leverage contracts, swap contracts with underlying value deriving from assets, interest rate, exchange rate, index or other benefits, and the composite contracts of the aforementioned products.
- (II) Operation or hedge strategy: The Company earns its profit from normal operation and the engagement in the aforementioned derivative trade is solely for hedge off the exchange risk deriving from operation, and shall not engage in any form of trade in speculative nature. The foreign currencies on hand shall be relevant with the foreign exchange needs of the Company in import and export trade.
- (III) Segregation of authority and responsibility
  1. The General Management is responsible for mapping out the strategy for the overall foreign exchange operation of the Company.
  2. Determine the position of the Company in foreign exchange on the basis of the business value and estimated foreign exchange transactions and map out the limit for hedge in each period (monthly
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or quarterly) and propose the operation strategy in the future. Upon approval of the General Manager and Chairman, General Management shall pursue the strategy in the operation.

(IV) Performance evaluation:
1. Performance evaluation shall be conducted based on the difference between the cost of exchange rate in book and the derivative trade.
2. The General Management shall assess the position of derivative trade at least once a week. For derivative trade for hedging, assessment shall be conducted at least twice a month. The assessment report shall be submitted to a senior office authorized by the Board.
(V) Total contract amount: the General Management shall keep track on the overall position of the Company to avoid transaction risk. Hedge trade shall not exceed the amount required for foreign exchange settlement in current period.
(VI) Set the upper limit of loss: the cut loss point for all derivative trade and particular contract shall be 10% of the total contract sum.
II. Operation procedure and control:
The Company may engage in derivative trade for hedge contract only.
The dealing, confirmation, and settlement of derivative trade shall be performed by different persons.
The dealing staff shall forward the “foreign exchange dealing slip” to the confirmation staff for registration.
The confirmation staff shall check with the service bank at regular intervals on the details and total amount of the transactions.
The dealing personnel shall pay close attention to the total amount of trade at any time to ensure the amount falls within the total contract amount as required under This Procedure.
Prepare a record book for tracking the type of derivative trade, the amount
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of trade, the date of Board resolutions and matters for precaution in full detail.

The accounting of derivative trade shall be based on the accounting principles generally accepted in Taiwan and in accordance with applicable laws. With proper source documents in bookkeeping and accounting record for the fair presentation of the process of trade and the result.

III. Risk management policy:

1. Credit risk management

The counterparties of trade are limited to the service banks of the Company or professional brokers to avoid default risks of the counterparties.

2. Market risk management

In the engagement of derivative trade, pay close attention to unfavorable price in market or price fluctuation that may affect the financial position of the Company.

Liquidity risk management
Choose only derivatives with high liquidity (that can be squared up in market at any time) to ensure liquidity in market. The bank and market must be able to provide sufficient information and the ability to conduct trade in any market at any time.
Operation risk management

Duly observe the authorized limit and operation procedure of the Company, and included as an items for internal audit to avoid operation risk.

5. Legal risk management

All the documents binding the banks and the Company shall be reviewed by professionals before signing to avoid legal risk.

The senior office authorized by the Board shall conduct regular review of the risk management policy currently in effect to ensure it is appropriate,
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and shall duly observe This Procedure and other procedures of the Company governing derivative trade.

  7. The senior officer authorized by the Board shall monitor the trade and the profit position. In the event of abnormality found in the trade, take necessary measure and report to the Board at once. If the Company has established seats for Independent Directors, the Independent Directors shall attend the session of the Board and express opinion.

IV. Internal audit:
- Internal auditors of public companies shall keep abreast of the internal control of derivative trade to ensure it is appropriated exercised, and shall conduct audit on the dealing department to ensure the compliance of the transaction procedure of derivative trade on a monthly trade. The findings from the audit shall be compiled into an audit report. In case of material breach of the procedure, notify the Supervisors in writing at once.
Article X: The Company may engage in corporate merger, spinoff, acquisition or acceptance of the assignment of shares, and, before calling for Board session for making decision, appoint a certified public accountant, legal attorney, or securities underwriter to express opinions on the rationality of the ratio of share swap, acquisition price, or payment in cash or other property to shareholders, and present related proposals to the Board for discussion and resolutions.
Article XI: In participation in corporate merger, spinoff, or acquisition, the Company shall prepare related documents on the content and agreements on the merger, spinoff, or acquisition for disclosure to the shareholders before the General Meeting of Shareholders is in session, and deliver these documents and the opinion from the experts as stated in the first section of the previous article to the shareholders for the meeting as reference for decision-making on the merger, spinoff, or acquisition. This requirement could be waived for merger, spinoff, or acquisition that does not require the resolution of the General Meeting of Shareholders. If any of the participating companies in the merger, spinoff, or acquisition cannot hold their General Meeting of Shareholders successfully due to the lack of a quorum, insufficient votes in balloting, or other legal restrictions, that resolutions cannot be
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made, or the proposals of merger, spinoff, or acquisition was vetoed by their shareholders, these participating companies shall present a public statement for an explanation, and proposition for subsequent action and the expected date of another session for the General Meeting of Shareholders.

Article XII: Unless the law specified otherwise, or the prior consent of Financial Supervisory Commission is necessary under special circumstance, the companies participating in the merger, spinoff, or acquisition shall hold the session of the Board and the General Meeting of Shareholders on the same day to make decision on the merger, spinoff, or acquisition. Unless the law specified otherwise, or the prior consent of Financial Supervisory Commission is necessary under special circumstance, companies participating in the acceptance of the assignment of shares shall call for their Board session on the same day.

Companies participating in the merger, spinoff, acquisition, or acceptance of the assignment of shares that are also TWSE/GTSM-listed companies, compile the following information into a complete record in writing and retain for five (5) years as reference.

I. Basic information on personnel: including the titles, names, ID number （passport numbers for foreign nationals）participating in or executors of the plans for merger, spinoff, acquisition or acceptance of the assignment of shares before related information is disclosed.
II. Date of important events: including the entering into statement of intent or MOU, appointment of financial or legal counsels, entering into agreements, and the session of the Board.
III. Important documents and minutes of meetings on record: including the plans of merger, spinoff, acquisition, or acceptance of the assignment of shares, the statement of intent or MOU, major agreements, and the minutes of Board meetings on record.

Companies participating in the merger, spinoff, acquisition, or acceptance of the assignment of shares, which are also TWSE/GTSM-listed companies, shall, within two (2) days from the resolutions of the Board, declare the information as stated in I and II of the previous section in designated format to FSC via the Internet.

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If some of the companies participating in the merger, spinoff, acquisition, or acceptance of the assignment of shares, which are not TWSE/GTSM-listed companies, other participating companies that are TWSE/GTSM-listed companies shall enter into agreements with the former and proceed to section three and section four.

Article XIII: All personnel participating in or acknowledging the plans of merger, spinoff, acquisition, or acceptance of the assignment of shares shall undertake confidentiality in writing thereby shall not disclose any of the information contained in the plans before public disclosure of such information, and shall not purchase the stocks issued by the companies participating in the merger, spinoff, acquisition, or the acceptance of the assignment of shares or any other equity securities in their own names or in the name of a third party.
Article XIV: In participating in the merger, spinoff, acquisition, or acceptance of assigned shares, the Company shall not change the ratio of share swap or acquisition unless under the following circumstances, and shall specify in the agreements on the merger, spinoff, acquisition, or acceptance of assigned shares that the ratio of share swap and acquisition price may be adjusted:
I. Proceed to raising capital by offering new shares, issuance of convertible bonds, distribution of stock dividends, issuance of corporate bonds with subscription warrant, preferred shares with subscription warrant, subscription warrant, and other equity securities.
II. Disposition of major assets of the Company that affect the financial position and operation of the Company.
III. Occurrence of severe disasters, significant technological change that significantly affected the shareholders’ equity or stock price of the Company.
IV. Any participant in the merger, spinoff, acquisition, or acceptance of assigned shares adjusts the repurchase of treasury shares under law.
V. Change in the number of participants in the merger, spinoff, acquisition, or acceptance of assigned shares.
VI. Terms and conditions for change were explicitly stated in the agreement and
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disclosed publicly.

Article XV:

In participating in the merger, spinoff, acquisition, or acceptance of assigned shares, the Company shall explicitly state the rights and obligations of the companies participating in the merger, spinoff, acquisition, or acceptance of assigned shares and the following in the agreement:
I. Action on breach of contract.
II. The principles for handling equity securities and repurchased treasury shares of the companies being acquired or spin-off in the merger.
III. The principle of handling the repurchase of treasury shares and the quantity for repurchase after the calculation day of the ratio for share swap of the participants.
IV. The method for handling the change in the number of participants.
V. The progress schedule of the plan and expected date of completion.
VI. If the plan cannot be completed on time, the procedure for calling for the session of the General Meeting of Shareholders and the expected date of meeting.
Article XVI: In case any of the participating companies elects to engage in merger, spinoff, acquisition or acceptance of assigned shares with other companies after the information on the merger, spinoff, acquisition, or acceptance of shares has been disclosed, all participants in the previous merger, spinoff, acquisition, or acceptance of assigned shares shall proceed to a new round of procedure or legal action already accomplished. That is unless in circumstances that the number of participants decrease and the Boards of these companies have already been authorized by their shareholders for making such changes that these companies can be exempted for holding a new round of meeting for the shareholders for resolution.
Article XVII: For participants in the merger, spinoff, acquisition, or acceptance of assigned shares, which are not public companies, the Company shall enter into agreements with these companies and proceed to Article XII, Article XIII, and Article XVI of This Procedure.
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Article XVIII: Criteria for announcement and declaration

In case any of the following is applicable to the acquisition or disposition of assets by the Company, the Company shall declare with the Financial Supervisory Commission at designated website in the required format by nature of the transaction within two (2) days after the day of deed:

I. Acquisition or disposition of property with related parties, or acquisition or disposition of other assets with related parties other than property and the transaction amount of which exceeds 20% of the paid-in capital or 10% of the total assets of the Company, or TWD300 million, except the trading of government bonds, or RP-RS bonds, subscription or redemption of domestic money market funds.
II. Proceed to merger, spinoff, acquisition, or acceptance of assigned shares.
III. Loss from derivative trade at the upper limit of overall loss or loss from particular contract in the procedure.
IV. Trading of assets, disposition of right to debts by financial institutions, or investment in Mainland China further than the transactions specified from I~III in this articles exceeding 20% of the paid-in capital of the Company or TWD300 million with the exception of the following:
(I) Trading of government bonds.
(II) Investment is a profession with engagement in trading of securities in the securities exchanges and OTC market of Taiwan and foreign countries, or subscription in the primary securities market by securities dealers or subscription of securities in conformity to requirements.
(III) Trading of RP-RS bonds, subscription, or redemption of domestic money market funds.
(IV) The types of assets involved in the acquisition or disposition are equipment for business use and the counterparties are not related parties and the amount falls below TWD500 million.
(V) If the real estate property for construction use that obtained or disposed by the Company in operating construction business and the transaction - 68 -

object is not related to the Company, the transaction amount falls below NTD500 million.

(VI) Acquisition of property through the commissioning of construction on proprietary lands, commissioning of construction on leased lands, joint venture in construction with sharing of finished premises, joint venture in construction with sharing of proceeds from sale of finished premises, and joint venture in construction with sharing of finished premises for selling with anticipated investment falling below TWD500 million.

The aforementioned amount of transaction shall be calculated in the methods specified below:

I. The amount of each transaction.
II. The amount of transaction with particular counterparty for the acquisition or disposition of the same kind of subject matter in the transaction in one (1) year accumulatively.
III. The amount of transaction from the acquisition or disposition (separate accumulation for acquisition and disposition) of the same project of property development in one (1) year accumulatively.
IV. The amount of transaction from the acquisition or disposition (separate accumulation for acquisition and disposition) of the same security in one (1) year accumulatively.

The period of one (1) year as mentioned in II shall be the duration of one (1) year from the day of deed moving backing for one (1) year in retrospect. The portion already declared could be excluded from the calculation.

The Company shall declare the status of derivative trade undertaken by the Company and subsidiaries that are not domestic public companies to the end of the previous month with Financial Supervisory Commission in the required format to designated website by the 10[th] day of the month.

In the event of error of missing content in the items required for declaration, a new round of declaration is required in making correction to the error or

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supplementation to the missing content.

In the acquisition or disposition of assets, the Company shall keep related agreements, minutes of meetings on record, registries, and appraisal reports, the written opinions of the certified public accountants, legal attorneys, and securities underwriters at the Company for record, and shall retain at least five (5) years unless the law provides otherwise.

If any of the following is applicable after the Company has declared for the transactions, declare with Financial Supervisory Commission on related information within two (2) days after the day of deed to designated website:

I. Alteration, termination, or discharge of related agreements already entered into.
II. The acquisition, spinoff, acquisition, or acceptance of assigned shares cannot be accomplished by the scheduled date.
III. Alteration of the content of previous declaration.

The Company shall make declaration for the subsidiaries that are not domestic public companies on matters required for declaration. The standard applicable to subsidiaries for declaration in “exceeding 20% of the paid-in capital or 10% of the total assets” shall be the paid-in capital or 10% of the total assets of the Company.

The requirement of 10% of the total assets shall be based on amount of the total assets stated in the separate financial statements compiled in accordance with the Criteria for Compilation of Financial Statements by Securities Issuers and covered the most recent fiscal period.

Article XIX: Subsidiaries of the Company shall institute their procedures for acquisition and disposition of assets and shall conduct self-assessment to ensure the acquisition or disposition of assets was carried out in accordance with the procedures. The reports of the subsidiaries on self-assessment shall be submitted to the internal auditing function of the Company for review.

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Article XX: Anything not covered by This Procedure shall be governed by applicable laws and related rules and regulations of the Company.
Article XXI: In case the managers and case officers of the Company take advantage of their positions in the Company to acquire or dispose assets illegally in the course of acquisition or disposition of assets for the Company, which is also a violation of This Procedure, the Company shall impose penalty in accordance with applicable rules and regulations.
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[Appendix VIII]

Anderson Group

Regulation Governing Election of Directors and Supervisors (before amendment)

This Regulation was passed by the Board in a session held on March 31, 2006 Ratified by the General Meeting of Shareholders in a regular session held on June 23, 2006 and was effective on the same day.

Article I: The election of Directors and Supervisors of the Company shall be governed by This Regulation.
Article II: Shareholders shall be entitled to the right of vote equivalent to the number of seats for the Directors and Supervisors to be elected for the holding of each share, which may be concentrated on particular candidates for distributed to different candidates.
Article III: The Board shall prepare the ballots equivalent to the number of seats for the Directors and Supervisors in the election and note down the number of votes.
Article IV: The Chairman shall appoint a number of observers and counters of the votes before the election to perform respective duties.
Article V: The Board shall prepare ballot boxes for the election of Directors and Supervisors, and shall open the boxes before balloting for inspection in front of the public.
Article VI: If the candidates of the election are also shareholders, they shall specify the account titles and account numbers in the field of “Candidate” of the ballot. If not, specify the ID card number in the same field of the ballot. If specific candidate is a government entity or an institution, fill in the name of the government entity or the name of the institution in the field of candidate or the name of the representative of the government entity or the institution. If there is more than one representative, fill in the names of all.
Article VII: A ballot is nullified if any of the following is applicable:
(I) Ballot not permitted to use under This Regulation.
(II) The use of blank ballot in voting.
(III) The handwriting on the ballot is blurred that cannot be identified, or the handwriting has been marked.
(IV) If the candidate is a shareholder, the account title and account number being marked on the ballot is not relevant with the account title and account number as inscribed in the shareholders registry. If the candidate is not a shareholder, the name and the ID card number as marked on the ballot is not

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relevant with the record of the registry.

(V) In addition to the account number (ID card number), account title (name) and the number of votes allocated, there is other wording on the ballot.
(VI) The account number (ID card number) and account title (name) of the candidate has not been marked on the ballot.
(VII) There are two more candidates put on the same ballot.
Article VIII: The Directors and Supervisors shall be elected by the General Meeting of Shareholders from persons with legal competence to fill the number of seats established under the Articles of Incorporation. Candidates who earned a larger share of the votes from balloting will be appointed to the seats as Directors or Supervisors.
If specific candidate is being elected as a Director and a Supervisor at the same time, such candidate shall determine to take the seat as Director or Supervisor with full discretion. If specific Director or Supervisor was found irrelevant with their personal information, or the result of election to the seat should be nullified by law after being elected, the vacancy shall be filled by the candidate who earned the next larger share of the votes. If there are two (2) or more candidates who won with the same number of votes, but there are no more seats for Directors and Supervisors, these candidates shall draw lots and the winner shall take the seat. The Chairman shall act on behalf of the candidate absent from the scene in drawing lots.
Article IX: The ballots shall be opened immediately after balloting. The Chairman shall announce the outcome of balloting on the scene.
Article X: Elections not carried out in accordance with Article 26-III- Paragraph 3, Section 4 of the Securities and Exchange Act shall be nullified. The Board shall deliver notice of election to office to Directors and Supervisors elected to office.
Article XI: Anything not covered by This Regulation shall be governed by the Company Act, the Articles of Incorporation, and other applicable laws.
Article XII: This Regulation shall be subject to the resolution of the General Meeting of Shareholders for causing into effect. The same procedure is applicable to any amendment thereto.

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[Appendix IX]

Anderson Group

Regulation Governing Election of Directors and Supervisors

Article I:

Purpose and legal reference

This Regulation is instituted in accordance with the “Company Act” and “Articles of Incorporation” of the Company and in consultation with Article 41 of the “Corporate Governance Best Practice Principle for TWSE/GTSM-listed Companies” and “Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies” for the election of Directors and Supervisors in fairness, equity, and transparency. The election of directors and supervisors of the Company shall be managed according to the provisions specified in this Regulation, unless otherwise specified in the laws or regulations or the "Articles of Incorporation".

Article II: The overall staffing of the Board shall be taken into consideration in holding election of Directors. The Board of Directors shall consist of a diversity of professionalism and specialization attuning to the function, the mode of operation, and development needs of the organization and shall include but not limit to the following two (2) major aspects:
I. Fundamental condition and value: gender, age, nationality, and culture.
II. Professional knowledge and skill: professional background (such as law, accounting, industry, finance, marketing, or technology), professional skill, and industry experience.

The members of the Board shall be disciplined with the kind of knowledge, skill, and insight necessary for the performance of assigned duties and the general capacity specified as follows:

I. Judgment of operation.
II. Accounting and financial analysis.
III. Corporate management.
IV. Crisis management.
V. Industry knowledge.
VI. International market perspective.
VII. Leadership.
VIII. Decision-making.

At least more than half of the Directors shall not be spouse or kindred within the

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2[nd] tier under the Civil Code to one another.

The Board shall consider the adjustment of its members based on performance evaluation results.

Article III: Supervisors of the Company shall be qualified with the following:

I. Integrity and pragmatism.
II. Fair judgment.
III. Professional knowledge.
IV. Wealth of experience.
V. Reading financial statements.

At least one seat of the Supervisor shall not be spouse or kindred within the 2[nd] tier under the Civil Code to a Director.

Supervisors cannot hold positions as Director, manager or employee of the Company and at least one of them shall have residence in Taiwan so as to perform the function of supervision at the time of need.

Article IV: In case the Company should establish the seats for Independent Directors, or elects to establish the seats for Independent Directors, the qualification of Independent Director shall be in compliance with Articles 2, 3, and 4 of the “Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies”.

The election of Independent Directors for the Company shall be held in compliance with Articles 5, 6, 7, 8, and 9 of the “Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies”, and also Article 24 of the “Corporate Governance Best Practice Principle for TWSE/GTSM-listed Companies”.

Article V: The election of Independent Directors for the Company shall be held under the nomination system as stated in Article 192-1 of the Company Act. For reviewing the qualification, education, and work experience of Independent Directors to ensure no violation of any of the conditions specified in Article 30 of the Company Act, additional listing of certification documents for proof of other qualifications is prohibited. The review result shall be made known to the shareholders as reference so that they could elect competent Independent Directors.

In case Directors are relieved from office for whatever reasons to the effect that there are less than 5 seats of Directors, the Company shall hold an election in the nearest session of the General Meeting of Shareholders to fill the vacancies. If there are more than one-third of the seats of Directors as stated in the Articles of Incorporation were left vacant, a special session of the General Meeting shall be

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called for within 60 days after the day of deed to elect Directors to fill the vacancies.

If the number of seats for Independent Directors falls below the requirements under the exclusionary clause specified in Article 14-II-1 of the Securities and Exchange Act, an election shall be held in the nearest session of the General Meeting of Shareholders to fill the vacancies. In the event of the relief of Independent Directors from office, a special session of the General Meeting shall be called for within 60 days after the day of deed to elect Independent Directors to fill the vacancies.

In case Supervisors are relieved from office for whatever reasons to the effect that the seats of Supervisors falls below the requirement as stated in the Articles of Incorporation, a special session of the General Meeting shall be called for within 60 days after the day of deed to elect Supervisors to fill the vacancies.

Article VI:

The cumulative voting system shall be adopted for the election of Directors and Supervisors. Shareholders shall be entitled to the right of vote equivalent to the number of seats for the Directors and Supervisors to be elected for the holding of each share, which may be concentrated on particular candidates for distributed to different candidates.

Article VII: The Board shall prepare the ballots equivalent to the number of seats for the Directors and Supervisors in the election and note down the number of votes.

Article VIII:

The votes for the election of Directors and Supervisors shall be counted separately to fill the seats as prescribed by the Articles of Incorporation. Candidates who earned a larger share of the votes from balloting will be appointed to the seats as Directors or Supervisors. If there are two (2) or more candidates who won with the same number of votes but there are no more seats for Directors and Supervisors, these candidates shall engage in drawing lots and the winner shall take the seat. The Chairman shall act on behalf of the candidate absent from the scene in drawing lots.

In case the Director elect and Supervisor elect was found in defiance of Article 26-III Paragraph 3 and 4 of the Securities and Exchange Act and have been proved irrelevant with their personal information or other applicable laws shall be nullified. Candidates who earned the next larger share of the votes shall fill the vacancies. While specific Director may declare to give up the seat before the Company petitioned with the competent authority for making change in registration, the candidate who earned the second larger share of the votes shall fill the vacancy.

Directors shall be elected to the seats on the basis of the outcome of balloting where candidates will be appointed to the seats by the quantity of votes being cast in descending order and the candidate who earned the next larger share of the

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votes will be at top priority to fill the vacancy left behind by the elected Directors relieved from office.

Article IX: The Chairman shall appoint a number of observers and counters of the votes before the election to perform respective duties. The Board shall prepare ballot box for the election and shall open the box before balloting for inspection in front of the public.
Article X: If the candidates of the election are also shareholders, they shall specify the account titles and account numbers in the field of “Candidate” of the ballot. If not, specify the ID card number in the same field of the ballot. If specific candidate is a government entity or an institution, fill in the name of the government entity or the name of the institution in the field of candidate or the name of the representative of the government entity or the institution. If there is more than one representative, fill in the names of all.
Article XI: A ballot is nullified if any of the following is applicable:
(I) Ballot not permitted to use under This Regulation.
(II) The use of blank ballot in voting.
(III) The handwriting on the ballot is blurred that cannot be identified, or the handwriting has been marked.
(IV) If the candidate is a shareholder, the account title and account number being marked on the ballot is not relevant with the account title and account number as inscribed in the shareholders registry. If the candidate is not a shareholder, the name and the ID card number as marked on the ballot is not relevant with the record of the registry.
(V) In addition to the account number (ID card number), account title (name) and the number of votes allocated, there is other wording on the ballot.
(VI) If the name of specific candidate being put on the ballot is identical with another shareholder, but no account title or ID number has been put down for differentiation and identification.
Article XII: The ballots shall be opened immediately after balloting. The Chairman shall announce the outcome of balloting and the Director elects and Supervisor elects on the scene.

The ballots of the aforementioned election shall be sealed by the observers with their authorized signatures affixed and shall be kept for at least one (1) year. If legal action is instituted by the shareholders pursuant to Article 189 of the Company Act, the ballots shall be kept until the case is closed.

Article XIII: The Board shall deliver notice of election to office to Directors and Supervisors elected to office.

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Article XIV: Anything not covered by This Regulation shall be governed by the Company Act, the Articles of Incorporation, and other applicable laws.
Article XV: This Regulation shall be subject to the resolution of the General Meeting of Shareholders for causing into effect. The same procedure is applicable to any amendment thereto.
Article XVI: This Regulation was instituted on March 31 2006. Amendment for the 1[st] instance was made on April 5 2017.

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[Appendix X]

Basic information on nominees of Independent Directors

Name	Lai Chun-Liang	Wu Ching-Sung
A/C number	-	-
Shareholding quantity	-	-
Education	Bachelor of Mechanical Engineering, Tatung Industrial College; Master of Mechanical Engineering, National Taiwan University; PhD, Mechanical and Aerospace Engineering, Case Western Reserve University, USA.	International DBA, UCLA, USA MBA, National Taiwan University Bachelor of Management Science, National Chiao Tung University
Experience in the last 5 years	Mechanical Engineering, NTU: Professor Emeritus (2016/8 to present); Dept of Mechanical Engineering, NTU: Professor (1991/8~2016/7); Dept of Mechanical Engineering, NTU: Associate Professor (1986/8 ~ 1991/7); NASA-Lewis Research Center (1984/8`～` 1986/7)	University of Chinese Culture: Professor (2014/8/1 to present); National Taiwan University: Professor (1993/8/1`～`2014/7/1`）`

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[Appendix XI]

Anderson Group Shareholding of all Directors and Supervisors

			Date: April 21 2017	Date: April 21 2017
Title	Name	Type	Quantity held	Proportion
Chairman	Liao Wen-Chia	Common share	2,000,000	1.11%
Director	Sheng Hai-Tien	Common share	451,494	0.25%
Director	Lee Chang-Feng	Common share	6,263	-
Director	Hsu Shan-Ko	Common share	-	-
Director	Yun Yung Investment Co., Ltd.	Common share	20,000,000	11.11%
Director	Ko Chang-Chu	Common share	9,934	0.01%
Director	Wang Chan-Hsiung	Common share	-	-
Total shareholder of Directors			22,467,691	12.48%
Supervisor	Chu Yung-Ta	Common share	786,000	0.44%
Supervisor	Lee Hui-Chin	Common share	565,000	0.31%
Total shareholder of Supervisors			1,351,000	0.75%

Note: All Directors of the Company shall hold 13,500,000 shares while the all Supervisors of the Company shall hold 1,350,000 shares as required by law.

The proportion of shareholding as shown in the above table is based on the total quantity of 180,000,000 outstanding shares as of the date transfer of shares is prohibited in preparation for the regular session of the General Meeting of Shareholders for this year.

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AI assistant

ANDERSON — AGM Information 2017

51851_rns_2017-07-26_b55d9603-7a00-4eb2-b271-68807d5661f4.pdf

Table of Content

Anderson Group

Procedure for Regular Session of 2017 General Meeting of Shareholders

Anderson Group Agenda for Regular Session of 2017 General Meeting

Report

Ratification

Discussion and Election

Motion No. 1: (presented by the Board)

Motion No. 2: (presented by the Board)

Motion No. 3: (presented by the Board)

Motion No. 4: (presented by the Board)

Motion No. 5: (presented by the Board)

Motion No. 6: (presented by the Board)

Motion No. 7: (presented by the Board)

Motion No. 8: (presented by the Board)

Extemporary Motions

Adjournment of meeting

Appendix

[Appendix I]

Anderson Group

Operation Highlight

1. The outcome of business plan

2. Analysis of income position and profitability

II. Production and sale policy and business objective in 2017

1. Precision machinery

2. Electronic Machine Plant (Sogotec)

3. Inkjet Printing Machine Plant

Anderson Group Supervisor’s Review Report

To: Regular Session of 2017 General Meeting of Shareholders

Opinion

Basis for Opinion

Key Audit Matters

Inventory Provision

Estimated Impairment of Accounts Receivable

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

Auditors’ Responsibilities for the Audit of the Financial Statements

Notice to Readers

ANDERSON INDUSTRIAL CORPORATION

BALANCE SHEETS DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars)

ANDERSON INDUSTRIAL CORPORATION

STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

ANDERSON INDUSTRIAL CORPORATION

STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

ANDERSON INDUSTRIAL CORPORATION

STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars, Except Per Share Amount)

ANDERSON INDUSTRIAL CORPORATION

STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars)

ANDERSON INDUSTRIAL CORPORATION

STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars)

Opinion

Basis for Opinion

Key Audit Matters

Inventory Provision

Estimated Impairment of Accounts Receivable

Other Matter

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

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

Notice to Readers

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars)

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015 (In Thousands of New Taiwan Dollars, Except Per Share Amounts)

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015

(In Thousands of New Taiwan Dollars)

ANDERSON INDUSTRIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015

(In Thousands of New Taiwan Dollars)

[Appendix IV]

Anderson Group (before amendment)

[Appendix V]

ANDERSON AGM Information 2017