Chang Type - AGM Information 2024

Ticker Symbol ： 1541

CHANG TYPE INDUSTRIAL CO., LTD.

Handbook for the 2024 Annual

Shareholders’ Meeting

Date: Friday, 21 June 2024

Location: No. 155-1, Xinsheng N. Rd., Fengyuan Dist., Taichung City 420020, Taiwan (R.O.C.)

(5-village joint community center of Fengyuan Dist.)

I.
Meeting Procedures．．．．．．．．．．．．．．．．．．．．．．．．
II.
Meeting Agenda．．．．．．．．．．．．．．．．．．．．．．．．．．
III.
Report Items．．．．．．．．．．．．．．．．．．．．．．．．．．．
IV.
Proposed Resolutions．．．．．．．．．．．．．．．．．．．．．．．．
V.
Matters for Discussion．．．．．．．．．．．．．．．．．．．．．．．
VI.
Extempore Motions．．．．．．．．．．．．．．．．．．．．．．．．
VII.
Attachment
1. 2023 Business Report．．．．．．．．．．．．．．．．．．．．．．．
2. 2023 Audit Committee’s Review Report．．．．．．．．．．．．．．．
3. Independent Auditors’ Report and 2023 Financial Statements．．．．．．．
4. Cross-Reference Table on Articles of the “Rules of Procedure for Board of
Directors Meetings”．．．．．．．．．．．．．．．．．．．．．．．．
5. Cross-Reference Table on Articles of the “Articles of Incorporation”．．．．．
6. Articles of Incorporation．．．．．．．．．．．．．．．．．．．．．．
7. Rules of Procedures for Shareholder Meetings．．．．．．．．．．．．．
8. Shareholding of Directors．．．．．．．．．．．．．．．．．．．．． Pages
2
3
3-4
5
6
6
7-9
10
11-31
32-37
38-39
40-51
52-57
58

CHANG TYPE INDUSTRIAL CO., LTD.

Meeting Procedures for the 2024 Annual Shareholders’ Meeting

I. Calling of Meeting to Order II. Chairman’s Address
III. Report Items
IV. Proposed Resolutions
V. Matters for Discussion
VI. Extempore Motions
VII.Adjournment

CHANG TYPE INDUSTRIAL CO., LTD.

Meeting Agenda for the 2024 Annual Shareholders’ Meeting

Time: Friday, 21 June 2024, at 9:00 a.m.

Location: No. 155-1, Xinsheng N. Rd., Fengyuan Dist., Taichung City 420020, Taiwan (R.O.C.) (5-village joint community center of Fengyuan Dist.)

Convening Way: Physical Shareholders’ Meeting

I. Call the Meeting to Order ＜ Announcement of total shares held by shareholders present in person or by proxy ＞
II. Chairman’s Address
III. Report Items
(1) 2023 Business Report
(2) 2023 Audit Committee’s Review Report
(3) Report on the Distribution of Compensation for Employees and Remuneration for Directors in 2023
(4) Amend and Add Part of the Articles of this Company’s “Corporate Social Responsibility Best Practice Principles”
(5) Amend and Add Part of the Articles of this Company’s “Rules of Procedure for Board of Directors Meetings”
(6) Report on the Distribution of Cash Dividends from Earnings in 2023
IV. Proposed Resolutions
(1) 2023 Business Report and Financial Statements.
(2) 2023 Earnings Distribution Case
V. Matters for Discussion
(1) Amend Part of the Articles of this Company’s “Articles of Incorporation”.
VI. Extempore Motions
VII. Adjournment

Report Items

I. 2023 Business Report

Explanatory Notes: Please refer to Attachment 1 for 2023 Business Report (p.7-9 of this handbook).

II. 2023 Audit Committee’s Review Report

Explanatory Notes: Please refer to Attachment 2 for Audit Committee’s Review Report (p.10 of this handbook).
III. Report on the Distribution of Compensation for Employees and Remuneration for Directors in 2023
Explanatory Notes: Following Article 30 of the Articles of Incorporation, the employees’ compensation and directors’ remuneration in 2023 are NT$4,124,632 and NT$3,299,706, respectively, both distributed in cash.

IV. Amend and Add Part of the Articles of this Company’s “Corporate Social Responsibility Best Practice Principles”

Explanatory Notes:

(1) In accordance with the partial text revision of the “Corporate Social Responsibility Best Practice Principles for TWSE/TPEx Listed Companies” amended by the TWSE on 7 December 2021, it is proposed to revise part of the Articles of the Company's “Corporate Social Responsibility Best Practice Principles” and rename the Principles as “Sustainable Development Best Practice Principles”.
(2) The cross-reference table on the Company's “Corporate Social Responsibility Best Practice Principles” before and after the revision is attached herewith (Please refer to Attachment 4, p.32-37 of this handbook).
V. Amend and Add Part of the Articles of this Company’s “Rules of Procedure for Board of Directors Meetings”

Explanatory Notes:

1. According to Article 7, Paragraph 1, Subparagraph 6 of the “Regulations Governing Procedure for Board of Directors Meetings of Public Companies”, if there is no managing director among the board of directors, the election or discharge of the chairman should be listed as an agenda item for discussion at the board meeting. It is proposed to amend certain articles of the Company's “Rules of Procedure for Board of Directors Meetings” accordingly.

2.The Company has established corporate governance supervisors on 13 March 2023. Therefore, certain articles are proposed to be amended accordingly.
The cross-reference table on the Company's “Rules of Procedure for Board of Directors Meetings” before and after the revision is attached herewith (Please refer to Attachment 5, p.38-39 of this handbook).

VI. Report on the Distribution of Cash Dividends from Earnings in 2023

Explanatory Notes: (1) The Board of Directors resolves to distribute cash dividends of NT$39,400,000 (NT$0.5 per share) from the 2023 earnings of the Company.
(2) The cash dividends are calculated on a pro-rata basis up to NT$1, with the amount below NT$1 being rounded off; for those total fractional amount of less than NT$1, the amount after the decimal point shall be adjusted in the sequence of the amount and the shareholders’ account number till the total distributed cash dividend amount is matched.
(3) The proposal has been approved by the Board of Directors and the Chairman was authorized to resolve the record date, dividend payment date, and other relevant issues. The Chairman is also authorized to make any subsequent changes in the payout ratio as a result of a change in the number of outstanding ordinary shares of the Company.

Proposed Resolutions

Proposal 1 (Proposed by the Board of Directors) Subject: Adoption of the Company’s 2023 Business Report and Financial Statements. Explanatory Notes: (1) The Company’s 2023 parent company only financial statements and consolidated financial statements were audited by independent auditors, Lo,Wen-Chen and Huang,Yu-Ting, of Ernst & Young with an unqualified audit report, along with the 2023 Business Report have been submitted to the Audit Committee for review and approval and a written auditor's report has been issued accordingly.

(2) For the Business Report, independent auditors’ audit report, and the abovementioned Financial Statements, please refer to Attachment 1 and 3 (p.7-9 and p.11-31 of this handbook.
(3) Please ratify the proposal.

Resolution:

Proposal 2 (Proposed by the Board of Directors) Subject: Adoption of the Company’s 2023 Earnings Distribution Explanatory Notes: (1) The 2023 Earnings Distribution Statement is presented as follows:

CHANG TYPE INDUSTRIAL CO., LTD. 2023 Earnings Distribution Statement

CHANG TYPE INDUSTRIAL CO., LTD. 2023 Earnings Distribution Statement	CHANG TYPE INDUSTRIAL CO., LTD. 2023 Earnings Distribution Statement
Unit: NT`＄`
Item	Amount
Beginning retained earnings (31 December 2022) Add: Net profit after tax of 2023 (Loss) gain from remeasurements of defined benefit plan for 2023	$683,633,680 115,190,286 (1,520,241)
Subtotal Less: Reversal of special reserve - debit balance of cumulative translation adjustments (Note 3) legal reserve	797,303,725 386,537 (11,367,005)
Distributable earnings Less: bonus shares to shareholders – cash(NT$0.50per share)	786,323,257 (39,400,000)
Endingretained earnings(31 December 2023)	746,923,257

Chairman: General Manager: Accounting Supervisor:

Remark:

The net profit of 2023 shall be distributed on a top-priority basis.
Actuarial gains or losses on defined benefit plans are recognized as retained earnings in the period when they occur.
Following the FSC’s letter No. 0950000507 issued on 27 January 2006, the special surplus reserves shall be appropriated and reversed to the "Net decrease in other equity" account.
(2) Please ratify the proposal.

Resolution:

Matters for Discussions

Proposal 1 (Proposed by the Board of Directors)

Subject: Amendment to Part of the Articles of this Company’s “Articles of Incorporation” Explanatory Notes:

In accordance with the amendments to the Company Act and the Company's “Articles of Incorporation”, it is proposed to revise certain articles of the Company's "Articles of Incorporation”.
For the cross-reference table of the “Articles of Incorporation” is attached herewith. (Please refer to Attachment 6, p.40-51 of this handbook)
Please proceed to discuss the proposal.

Resolution:

Extempore Motions

Adjournment

Attachment 1

CHANG TYPE INDUSTRIAL CO., LTD.

2023 Business Report

The consolidated revenue for 2023 was NT$3,378 million, representing a decline of 16.7%; the profit was NT$115 million and the EPS was NT$1.46, representing a decline of 57.7%. Due to the continued inventory backlog among distributors from the previous year, coupled with global challenges such as the pandemic, wars, inflation, shortages in energy and food supply, sustained decline in consumer demand, and liabilities from heavy industries, resulting in a significant decrease in revenue and profits in 2023.

The following is a report on the Company's consolidated results of operations for 2023 and business plan for 2024.

I. Consolidated Results of Operations for 2023
(I) The Outcome of Business Plan Implementation
- Since the beginning of this year, despite the easing of the pandemic, the global economy has been adversely affected by persistent high inflation from last year, the Russia-Ukraine conflict, interest rate hikes, and the strengthening of the US dollar. These factors have eroded consumer confidence and purchasing power, dampening demand and leading to a continuation of last year's sharp decline in demand. Facing crises of excess customer inventory and increased US sanctions on China, the pressure of global economic recession has intensified. Several industries have weakened, impacting manufacturers. Customer orders have significantly decreased since the second half of the previous year. In addition to cost-cutting measures in operations and encouraging staff to take leave, these circumstances have led to a decline in sales performance. Consolidated revenue has decreased by 16.7% to NT$3,378 million compared to last year .

In this period, our product performance continued to be significantly affected by a substantial decrease in sales orders. In the United States, the results of inflation control measures were notable, leading to a cessation of interest rate hikes. Starting from the fourth quarter, the US dollar weakened, with the New Taiwan Dollar depreciating by an average of 5.95% against the US dollar. This led to an increase in product gross profit margins, resulting in a 12% increase in product gross profit compared to the previous period. Operating expenses decreased, primarily due to reduced export, shipping, and sales warranty expenses corresponding to the decrease in sales. Additionally, subsidiary companies reduced expenses related to warehouse rental, personnel hiring, and equipment maintenance. Furthermore, there were no expenses related to product patent disputes from last year. As a result, consolidated operating profit increased by 67% to NT$285 million."

Non-operating expenses amounted to NT$139 million, primarily attributed to the depreciation of the exchange rate in the fourth quarter, resulting in a significant decrease in exchange gains by NT$285 million to NT$5.43 million. Additionally, there were mold service revenues of NT$12 million, financing and leasing interest expenses of NT$19 million, and provision for heavy indemnity expenses related to outsourced production and sales of parts amounting to NT$145 million. Compared to the previous period, net non-operating income decreased by NT$324 million, totaling NT$185 million. This was mainly due to decreased exchange gains of NT$290 million, financing and leasing interest expenses of NT$22 million, mold income of NT$21 million, and patent dispute indemnity expenses of NT$107 million. Consequently, the settlement of this period's pre-tax net profit was NT$146 million, a decrease of NT$210 million compared to the previous period's NT$356 million, representing a decline of 58.9%."

(II) Analysis of Receipts, Expenditures and Profitability

1. Analysis of Receipts and Expenditures

Consolidated Financial Statements			Unit: NTD	(in thousands)	Parent Company only Financial Statements			Unit: NTD (	in thousands)
Item	2023	2022	Increase	(Decrease)	Item	2023	2022	Increase	(Decrease)
			Amount	%				Amount	%
Operating revenue	3,378,030	4,057,447	(679,417)	(16.7)	Operating revenue	3,015,023	4,058,588	(1,043,565)	(25.7)
Gross profit	667,188	594,471	72,717	12.2	Gross profit	450,484	373,981	76,503	20.5
					Operating Income	302,398	172,423	129,975	75.4
Operating Income	285,183	170,758	114,425	67.0
Net profit before tax	146,179	355,966	(209,787)	(58.9)
					Net profit before tax	157,561	335,732	(178,171)	(53.1)
Net profit after tax	115,190	272,059	(156,869)	(57.7)
					Net profit after tax	115,190	272,059	(156,869)	(57.7)
Earnings per Share (NTD)	1.46	3.45	(1.99)	(57.7)
					Earnings per Share (NTD)	1.46	3.45	(1.99)	(57.7)

2. Profitability

	Consolidated Fin	ancial Statements
	It	em	2023	2022
Profitability	Retu	rn on Assets (%)	3.42	6.59
	Retur	n on Equity (%)	6.08	14.93
	Capital Adequacy Rate (%)	Operating Income	36.19	21.67
		Net Profit Before Tax	18.55	45.17
	Net P	rofit Margin(%)	3.41	6.71
	Earnings per Share(NTD)		1.46	3.45

Company Only Financial Statements	Company Only Financial Statements
Ite	m	2023	2022
Retu	rn on Assets (%)	3.52	6.85
Retur	n on Equity (%)	6.08	14.93
Capital Adequacy Rate (%)	Operating Income	38.38	21.88
	Net Profit Before Tax	20.00	42.61
Net P	rofit Margin(%)	3.82	6.70
Earnings per Share(NTD)		1.46	3.45

Budget Implementation in 2023: The company has not prepared a financial forecast for 2023 and has kept its expense budget within the 10% level or below.

(III) Research and Development Condition

In 2023, the company has invested NT$17.51 million in new product development, representing 1.0% of net revenue, and will continue to launch multiple updated models for sale in 2024.

II. Business Plan Summary for 2024

1. Business Policy

With the business philosophy of “Innovation, Efficiency, Quality, and Service”, we aim to provide products and services to our customers at the lowest possible cost, while creating advantages through attractive pricing, high quality, convenience, and other desirable features.

Business Plan
(1) Strengthening vertical integration of production to enhance competitiveness.
(2) Establishing core values to strengthen and enhance business performance.
Business Objectives
It is expected that the revenue in 2024 will continue to grow steadily, with the main sources of revenue coming from various types of circular saws, table saws, and other major products. In addition to cooperating with top international brands for OEM services, the company will continue to expand its own brand business. With the introduction of new product models and the strengthening of vertical integration of production, it is expected that both revenue and profits will continue to grow steadily.
Research and Development Plan
We will expand our product portfolio by venturing into new areas of OEM, brand product line development, brushless motor and control research and development, and the development of diversified tools. Despite the challenges posed by the difficult business environment, the company will continue to pursue steady and sustainable growth through a series of strategic measures and initiatives.
Expected Sales Volume: 550,000 units of electric tools and 595,000 units of components (parent company only information).

III. The Effect of External Competition, the Legal Environment, and the Overall Business Environment

External Competition Environment: Industry competition is inevitable and remains a benign interaction. The company continues to strengthen its competitive advantage and enhance core R&D technologies to meet consumer demand with stable product quality.
Legal Environment: All of the company's products are designed and developed while considering the regulations of each country and complying with their standards. The company will continue to monitor, update, and comply with possible changes in legal regulations in the future to ensure the maximum interests of the shareholders.
Overall Business Environment: Given the complex overall business environment, the company will consider the industry overview and observe the general economic trend when evaluating investments and business policies. Regarding the US consumer market, the continued clearance of the massive inventory accumulated during the pandemic period, coupled with the impact of high inflation and declining demand, has significantly affected the company. However, there has been some progress in inventory clearance. Nevertheless, the Company will continue to implement strategies such as reducing operational expenses to adapt to the situation .

Wishing all of our esteemed shareholders all the best.

CHANG TYPE INDUSTRIAL CO., LTD.

Chairman: CHANG, CHIN-CHIN

President: CHANG, CHIN-CHIN

Accounting Supervisor: CHANG, CHIN-HUA

Attachment 2

CHANG TYPE INDUSTRIAL CO., LTD. 2023 Audit Committee's Audit Report

The Board of Directors has prepared the Company's 2023 Consolidated Financial Statements and Parent Company Only Financial Statements, which have been audited by CPAs Lo,Wen-Chen and Huang,Yu-Ting of Ernst & Young Taiwan with an unqualified report. The Financial Statements together with the Business Report and Proposal for Distribution of Earnings have been reviewed and determined to be correct and accurate by the Audit Committee. According to the relevant requirements of Article 14-4 of the Securities and Exchange Act and Article 219 of the Company Act, we hereby submit this report for your review.

For the 2023 Annual Shareholder meeting

CHANG TYPE INDUSTRIAL CO., LTD.

Convener of Audit Committee: WANG, MING-JHIH

14 March 2024

Attachment 3

Independent Auditor’s Report

To Chang Type Industrial Co., Ltd.

Opinion

We have audited the accompanying parent company only balance sheets of Chang Type Industrial Co., Ltd. (the “Company”) as of 31 December 2023 and 2022, and the parent company only statements of comprehensive income, changes in equity and cash flows for the years ended 31 December 2023 and 2022, and notes to the parent company only financial statements, including the summary of material accounting policies.

In our opinion, the accompanying parent company only financial statements referred to above present fairly, in all material respects, the parent company only financial position of the Company as of 31 December 2023 and 2022, and its parent company only financial performance and cash flows for the years ended 31 December 2023 and 2022, in conformity with the requirements of the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Financial Statement Audit and Attestation Engagements of Certified Public Accountants and the Standards on Auditing of the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Parent Company Only Financial Statements section of our report. We are independent of the Company in accordance with the Norm of Professional Ethics for Certified Public Accountant of the Republic of China (the “Norm”), and we have fulfilled our other ethical responsibilities in accordance with the Norm. Best on the audits, 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 2023 the parent company only financial statements. These matters were addressed in the context of our audit of the parent company only financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Inventory valuation

As of 31 December 2023, the net inventories amounted to NT$427,867 thousand, accounting for 11% of the total assets. Because the amount was material to the Company’s financial statements, the sales were affected by the uncertainty due to market demand, and the valuation policy of the inventories involved a high level of management judgment, we determined this to be a key audit matter. Our audit procedures included, but were not limited to: performing simple test to assess the effectiveness of inventory internal control established by management; understanding the accounting policy around obsolete and slow-moving inventories; selecting important storage locations to observe inventory counts; sampling and testing the accuracy of inventory aging intervals to verify whether the aging reports were reasonable; in addition, in order to evaluate the reasonableness of inventories valuation, we also obtained inventory movement report, sampled and tested related certificates of purchases and sales, and verified the unit cost of inventories to access the net realizable value of inventories. We also assessed the adequacy of the disclosures related to inventories in Notes 5 and 6.

Provision for warranties

As of December 31, 2023, the provision for warranties amounted to NT$27,743 thousand. The management determined the estimate of the provision for warranties by the past experience of repairing consumers’ defective products. Because the estimates involved significant management judgment, we determined this to be a key audit matter. Our audit procedures included, but were not limited to: understanding the internal control of provision for warranties established by management; evaluating the reasonableness of accounting policy around provision for warranties and the accuracy of recalculating provision for warranties according to the accounting policy; analyzing the reasonableness of provision for warranties by comparing the amounts year over year. In addition, we obtained details of provision for warranties of the subsequent period to check the actual amounts or reversal of the provision for warranties of the subsequent period. We also assessed the adequacy of disclosures related to provision for warranties in Notes 5 and 6.

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

Management is responsible for the preparation and fair presentation of the parent company only financial statements in accordance with the requirements of 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 the parent company only financial statements that are free from material misstatement, whether due to fraud or error.

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

Those charged with governance, including audit committee or supervisors, are responsible for overseeing the financial reporting process of the Company.

Auditor’s Responsibilities for the Audit of the Parent Company Only Financial Statements

Our objectives are to obtain reasonable assurance about whether the parent company only financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s 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 Standards on Auditing of 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 parent company only financial statements.

As part of an audit in accordance with the Standards Auditing of the Republic of China, we exercise professional judgment and professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the parent company only 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 internal control of the Company.
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 ability to continue as a going concern of the Company. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the parent company only 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 auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure, and content of the parent company only financial statements, including the accompanying notes, and whether the parent company only 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 Company to express an opinion on the parent company only financial statements. We are responsible for the direction, supervision and performance of the group 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 the internal control that we identify during our audit.

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of 2023 the parent company only financial statements and are therefore, the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Lo,Wen-Chen Huang,Yu-Ting

Ernst & Young, Taiwan 14 March 2024

Notice to Readers

The accompanying parent company only financial statements are intended only to present the financial position, results of operations 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 parent company only financial statements are those generally accepted and applied in the Republic of China.

Accordingly, the accompanying parent company only financial statements and report of independent auditors are not intended for use by those who are not informed about the accounting principles or Standards on Auditing of the Republic of China, and their applications in practice. As the financial statements are the responsibility of the management, Ernst & Young cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation

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Independent Auditor’s Report

To Chang Type Industrial Co., Ltd.

Opinion

We have audited the accompanying consolidated balance sheets of Chang Type Industrial Co., Ltd. (the “Company”) and its subsidiary as of 31 December 2023 and 2022, and the related consolidated statements of comprehensive income, changes in equity and cash flows for the years ended 31 December 2023 and 2022, and notes to the consolidated financial statements, including the summary of material accounting policies.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of the Company and its subsidiary (the “Group”) as of 31 December 2023 and 2022, and their consolidated financial performance and cash flows for the years ended 31 December 2023 and 2022, in conformity with the requirements of the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards, International Accounting Standards, Interpretations developed by the International Financial Reporting Interpretations Committee or the former Standing Interpretations Committee as endorsed and became effective by Financial Supervisory Commission of the Republic of China.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Financial Statement Audit and Attestation Engagements of Certified Public Accountants and the Standards on Auditing of 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 Company and its subsidiary in accordance with the Norm of Professional Ethics for Certified Public Accountant of the Republic of China (the “Norm”), and we have fulfilled our other ethical responsibilities in accordance with the Norm. 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 2023 consolidated financial statements. 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.

Inventory valuation

As of 31 December 2023, the net inventories amounted to NT$1,127,187 thousand, accounting for 28% of the consolidated total assets. Because the amount was material to the Group’s financial statements, the sales were affected by the uncertainty due to market demand, and the valuation policy of the inventories involved a high level of management judgment, we determined this to be a key audit matter. Our audit procedures included, but were not limited to: performing simple test to assess the effectiveness of inventory internal control established by management; understanding the accounting policy around obsolete and slow-moving inventories; selecting important storage locations to observe inventory counts; sampling and testing the accuracy of inventory aging intervals to verify whether the aging reports were reasonable; in addition, in order to evaluate the reasonableness of inventories valuation, we also obtained inventory movement report, sampled and tested related certificates of purchases and sales, and verified the unit cost of inventories to access the net realizable value of inventories. We also assessed the adequacy of the disclosures related to inventories in Notes 5 and 6.

Provision for warranties

As of 31 December 2023, the provision for warranties amounted to NT$50,007 thousand. The management determined the estimate of the provision for warranties by the past experience of repairing consumers’ defective products. Because the estimates involved significant management judgment, we determined this to be a key audit matter. Our audit procedures included, but were not limited to: understanding the internal control of provision for warranties established by management; evaluating the reasonableness of accounting policy around provision for warranties and the accuracy of recalculating provision for warranties according to the accounting policy; analyzing the reasonableness of provision for warranties by comparing the amounts year over year. In addition, we obtained details of provision for warranties of the subsequent period to check the actual amounts or reversal of the provision for warranties of the subsequent period. We also assessed the adequacy of disclosures related to provision for warranties in Notes 5 and 6.

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 requirements of the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards, International Accounting Standards, Interpretations developed by the International Financial Reporting Interpretations Committee or the former Standing Interpretations Committee as endorsed by 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 ability to continue as a going concern of the Company and its subsidiary, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company and its subsidiary or to cease operations, or has no realistic alternative but to do so.

Those charged with governance, including audit committee or supervisors, are responsible for overseeing the financial reporting process of the Company and its subsidiary.

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 Standards on Auditing of 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.

As part of an audit in accordance with the Standards on Auditing of the Republic of China, we exercise professional judgment and professional skepticism throughout the audit. We also:

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 internal control of the Company and its subsidiary.
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 ability to continue as a going concern of the Company and its subsidiary. 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 auditor’s report. However, future events or conditions may cause the Company and its subsidiary to cease to continue as a going concern.
Evaluate the overall presentation, structure, and content of the consolidated financial statements, including the accompanying notes, and whether the consolidated 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 Company and its subsidiary 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.

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.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of 2023 consolidated financial statements 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.

Other

We have audited and expressed an unqualified opinion on the parent company only financial statements of the Company as of and for the years ended 31 December 2023 and 2022.

Lo,Wen-Chen Huang,Yu-Ting

Ernst & Young, Taiwan 14 March 2024

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Attachment 4

CHANG TYPE INDUSTRIAL CO., LTD.

Cross-Reference Table on Articles of the “Corporate Social Responsibility Best Practice Principles”

Articles	After the Amendment	Before the Amendment	Reason for amendment
Tittle	Sustainable DevelopmentBest Practice Principles	Corporate Social ResponsibilityBest Practice Principles	In accordance with the revised Corporate Social Responsibility Best Practice Principles by the TWSE, textual revisions have been made to the Company’s Corporate Social Responsibility Best Practices Principles.
Article 1	In order to implement the Company’s corporate social responsibility for fulfilling the purpose of sustainable development, the Company promulgates its “Sustainable Development Best Practice Principles” to manage economic, environmental, and social risks and impacts.	In order to implement the Company’s corporate social responsibility for fulfilling the purpose of corporate social responsibility, the Company promulgates its “Corporate Social Responsibility Best Practice Principles” to manage economic, environmental, and social risks and impacts.
Article 2	The Company actively fulfill its sustainable developmentin the course of its business operations so as to follow the international trend and to contribute to the economic development of the country, to improve the quality of life of employees, the community and society by acting as responsible corporate citizens, and to enhance competitive edges built onsustainable development.	The Principles applies to the Company and its business group. The Company actively fulfill its corporate social responsibility in the course of its business operations so as to follow the international trend and to contribute to the economic development of the country, to improve the quality of life of employees, the community and society by acting as responsible corporate citizens, and to enhance competitive edges built on corporate social responsibility.	Text modification
Article 3	In promotingsustainable development initiatives, the Company shall, in its corporate management guidelines and business operations, give due consideration to the rights and interests of stakeholders and, while pursuing sustainable operations and profits, also give due consideration to the environment, society and corporate governance. The Company shall, in accordance with the materiality principle,conduct risk assessments of	In promoting corporate social responsibility initiatives, the Company shall, in its corporate management guidelines and business operations, give due consideration to the rights and interests of stakeholders and, while pursuing sustainable operations and profits, also give due consideration to the environment, society and corporate governance. The Company shall, in accordance with the materiality principle, conduct risk assessments of environmental, social and corporate governance issues pertaining to	Text modification

	environmental, social and corporate governance issues pertaining to company operations and establish the relevant risk management policy or strategy.	environmental, social and corporate governance issues pertaining to company operations and establish the relevant risk management policy or strategy.	company operations and establish the relevant risk management policy or strategy.
Article 4	To implementsustainable development initiatives, the Company is advised to follow the principles below: 1. Exercise corporate governance. 2. Foster a sustainable environment. 3. Preserve public welfare. 4. Enhance disclosure ofsustainable developmentinformation.		To implement corporate social responsibility initiatives, the Company is advised to follow the principles below: 1. Exercise corporate governance. 2. Foster a sustainable environment. 3. Preserve public welfare. 4. Enhance disclosure of corporate social responsibility information.	Text modification
	1.
	2.
	3.
	4.	Enhance disclosure of


Article 5	TWSE/TPEx listed companies shall take into consideration the correlation between the development of domestic and internationalsustainable developmentissues and corporate core business operations, and the effect of the operation of individual companies and of their respective business groups as a whole on stakeholders, in establishing their policies, systems or relevant management guidelines, and concrete promotion plans forsustainable developmentprograms, which shall be approved by the board of directors and then reported to the shareholders meeting. When a shareholder proposes a motion involving sustainable development, the company's board of directors is advised to review and consider including it in the shareholders meeting agenda.		The Company shall take into consideration the correlation between the development of domestic and international corporate social responsibility issues and corporate core business operations, and the effect of the operation of individual companies and of its respective business groups as a whole on stakeholders, in establishing its policies, systems or relevant management guidelines, and concrete promotion plans for corporate social responsibility programs, which shall be proposed to the board of directors and then reported relevant performance to the shareholders meeting. Then, adjusting and adapting its promotion strategies in response to the current circumstances.	Text modification
Article 7	The board of directors of the Company shall exercise the due care of good administrators to urge the company to perform itssustainable developmentinitiatives, examine the results of the implementation thereof from time to time and continually make adjustments so as to ensure the thorough implementation of its sustainable developmentpolicies. The board of directors of the Company is advised to give full consideration to the interests of stakeholders, including the following matters, in the company'sfurtherance of its		The board of directors of the Company shall exercise the due care of good administrators to urge the company to perform its corporate social responsibility initiatives, examine the results of the implementation thereof from time to time and continually make adjustments so as to ensure the thorough implementation of its corporate social responsibility policies. The board of directors of the Company is advised to give full consideration to the interests of stakeholders, including the following matters, in the company's furtherance of its s corporate social	Text modification

	sustainable development objectives: 1. Identifying the company's sustainable developmentmission or vision, and declaring itssustainable developmentpolicy, systems or relevant management guidelines; 2. Makingsustainable developmentthe guiding principle of the company's operations and development, and ratifying concrete promotional plans forsustainable development initiatives; and 3. Enhancing the timeliness and accuracy of the disclosure of sustainable development information . The board of directors shall appoint executive-level positions with responsibility for economic, environmental, and social issues resulting from the business operations of the Company, and to report the status of the handling to the board of directors.	responsibilityobjectives: 1. Identifying the company's corporate social responsibility mission or vision, and declaring its corporate social responsibility policy, systems or relevant management guidelines; 2. Making corporate social responsibility the guiding principle of the company's operations and development, and ratifying concrete promotional plans for corporate social responsibility initiatives; and 3. Enhancing the timeliness and accuracy of the disclosure of corporate social responsibility information. The board of directors shall appoint executive-level positions with responsibility for economic, environmental, and social issues resulting from the business operations of the Company, and to report the status of the handling to the board of directors.
Article 8	The Company is advised to, on a regular basis, organize education and training on thepromotion of sustainable developmentinitiatives, including promotion of the matters prescribed in paragraph 2 of the precedingarticle.	The Company is advised to, on a regular basis, organize education and training on the promotion of corporate social responsibility initiatives, including promotion of the matters prescribed in paragraph 2 of the precedingarticle.	Text modification
Article 9	For the purpose of managing sustainable developmentinitiatives, the Company established an cross- departmental “Sustainable Development Administrative Committee” to be in charge of proposing and enforcing the sustainable developmentpolicies, systems, or relevant management guidelines, and concrete promotional plans and to report on the same to the board of directors on a periodic basis. The Company is advised to adopt reasonable remuneration policies, to ensure that remuneration arrangements support the strategic aims of the organization and align with the interests of stakeholders. It is advised that the employee performance evaluation system be combined withsustainable development policies, and that a clear and effective incentive and discipline system be established.	For the purpose of managing corporate social responsibility initiatives, the Administrative Department of the Company served as concurrent unit to be in charge of proposing and enforcing the corporate social responsibility policies, systems, or relevant management guidelines, and concrete promotional plans and to report on the same to the board of directors on a periodic basis. The Company is advised to adopt reasonable remuneration policies, to ensure that remuneration arrangements support the strategic aims of the organization and align with the interests of stakeholders. It is advised that the employee performance evaluation system be combined with corporate social responsibilitypolicies, and that a clear and effective incentive and discipline system be established.	Text modification

Article 10		The Company shall, based on respect for the rights and interests of stakeholders, identify stakeholders of the company, and establish a designated section for stakeholders on the company website; understand the reasonable expectations and demands of stakeholders through proper communication with them, and adequately respond to the important sustainable developmentissues which they are concerned about.	The Company shall, based on respect for the rights and interests of stakeholders, identify stakeholders of the company, and establish a designated section for stakeholders on the company website; understand the reasonable expectations and demands of stakeholders through proper communication with them, and adequately respond to the important corporate social responsibility issues which theyare concerned about.	Text modification
Article 12		The Company is advised to endeavor toutilize energymore efficientlyand use renewable materials which have a low impact on the environment to improve sustainability of natural resources.	The Company is advised to endeavor to utilize various resources more efficiently and use renewable materials which have a low impact on the environment to improve sustainability of natural resources.	Text modification
Article 17		The Company is advised to assess the current and future potential risks and opportunities that climate change may present to enterprises and to adopt related measures. The Company is advised to adopt standards or guidelines generally used in Taiwan and abroad to enforce corporate greenhouse gas inventory and to make disclosures thereof, the scope of which shall include the following: 1. Direct greenhouse gas emissions: emissions from operations that are owned or controlled by the company. 2. Indirect greenhouse gas emissions: emissions resulting from the utilization of energy such as importedelectricity, heating, or steam. 3. Other indirect emissions: emissions resulting from corporate activities that are not indirect emissions from energy, but are from other sources of emissions owned or controlled by the company. The Company is advised to compile statistics on greenhouse gas emissions, volume of water consumption and total weight of waste and to establish policies for energy conservation, carbon and greenhouse gas reduction, reduction of water consumption or management of other wastes and be promoted accordingly to minimize the impact of their business operations on climate change.	The Company is advised to assess the current and future potential risks and opportunities that climate change may present to enterprises and to adopt related measures. The Company is advised to adopt standards or guidelines generally used in Taiwan and abroad to enforce corporate greenhouse gas inventory and to make disclosures thereof, the scope of which shall include the following: 1. Direct greenhouse gas emissions: emissions from operations that are owned or controlled by the company. 2. Indirect greenhouse gas emissions: emissions resulting from the utilization of energy such as purchasedelectricity, heating, or steam. The Company is advised to compile statistics on greenhouse gas emissions, volume of water consumption and total weight of waste and to establish policies for energy conservation, carbon and greenhouse gas reduction, reduction of water consumption or management of other wastes and be promoted accordingly to minimize the impact of their business operations on climate change.	Text modification

Chapter 5	Enhancing Disclosure of DevelopmentInformation	Enhancing Disclosure ofCorporate Social ResponsibilityInformation	Text modification
Article 28	The Company disclose information according to relevant laws, regulations and the Corporate Governance Best Practice Principles for TWSE/TPEx listed Companies and fully disclose relevant and reliable information relating to their sustainable developmentinitiatives to improve information transparency. Relevant information relating to sustainable developmentshall disclose includes: 1.The sustainable development policies, systems, or related management guidelines, as well as specific implementation plans approved by the board of directors. 2. The implementation and promotion of corporate governance, sustainable development, and the maintenance of social welfare factors have implications for the operational and financial conditions of the company, influencing risks and impacts. 3. Goals and measures for promoting the sustainable development initiatives established by the companies, and performance in implementation. 4. Major stakeholders and their concerns. 5. Disclosure of information on major suppliers' management and performance with respect to major environmental and social issues. 6. Other information relating to sustainable development initiatives.	The Company disclose information according to relevant laws, regulations and the Corporate Governance Best Practice Principles for TWSE/TPEx listed Companies and fully disclose relevant and reliable information relating to their sustainable development initiatives to improve information transparency. Relevant information relating to sustainable development shall disclose includes: 1.The sustainable development policies, systems, or related management guidelines, as well as specific implementation plans approved by the board of directors. 2. The implementation and promotion of corporate governance, sustainable development, and the maintenance of social welfare factors have implications for the operational and financial conditions of the company, influencing risks and impacts. 3. Goals and measures for promoting the sustainable development initiatives established by the companies, and performance in implementation. 4. Major stakeholders and their concerns. 5. Disclosure of information on major suppliers' management and performance with respect to major environmental and social issues. 6. Other information relating to corporate social responsibility initiatives.	Text modification
Article 29	The Company shall adopt internationally widely recognized standards or guidelines when producingsustainability development reports, to disclose the status of their implementation of thesustainable developmentpolicy. It also is advisable to obtain a third-party assurance or verification for reports to enhance the reliability of the information in the reports. The reports are advised to include: 1. The policy, system, or relevant management guidelines and concrete promotion plans for implementing sustainable developmentinitiatives.	The Company shall adopt internationally widely recognized standards or guidelines when producing corporate social responsibility reports, to disclose the status of their implementation of the corporate social responsibility policy. It also is advisable to obtain a third-party assurance or verification for reports to enhance the reliability of the information in the reports. The reports are advised to include: 1. The policy, system, or relevant management guidelines and concrete promotion plans for implementing corporate social responsibility initiatives.	Text modification
	1.

		2. Major stakeholders and their concerns. 3. Results and a review of the exercising of corporate governance, fostering of a sustainable environment, preservation of public welfare and promotion of economic development. 4. Future improvements and goals.	2. Major stakeholders and their concerns. 3. Results and a review of the exercising of corporate governance, fostering of a sustainable environment, preservation of public welfare and promotion of economic development. 4. Future improvements and goals.
Article 30		The Company at all times monitor the development of domestic and foreign sustainable developmentstandards and the change of business environment so as to examine and improve their establishedsustainable developmentframework and to obtain better results from the promotion of thesustainable developmentpolicy.	The Company at all times monitor the development of domestic and foreign corporate social responsibility standards and the change of business environment so as to examine and improve their established corporate social responsibility framework and to obtain better results from the promotion of the corporate social responsibility policy.	Text modification
Article 31		The Sustainable Development Best Practice Principles shall be implemented after approval by the Board of Directors and shall be reported to the shareholders' meeting. The same applies when amendments are made. The Principles was approved on 4 November 2021. The first amendment to the Principles was made on 6 November 2023.	The Corporate Social Responsibility Best Practice Principles shall be implemented after approval by the Board of Directors and shall be reported to the shareholders' meeting. The same applies when amendments are made. The Principles was approved on 4 November 2021.	Addition of revision date and frequency.

Attachment 5

CHANG TYPE INDUSTRIAL CO., LTD.

Cross-Reference Table on Articles of the “Rules of Procedure for Shareholders Meetings”

Articles	After the Amendment	Before the Amendment	Reason for amendment
Article 12	The matters listed below as they relate to this Corporation shall be raised for discussion at a board meeting: 1. The Corporation's business plan. 2. Annual and semi-annual financial reports, with the exception of semi-annual financial reports that are not required under relevant laws and regulations to be audited and attested by a certified public accountant (CPA). 3. Adoption or amendment of an internal control system pursuant to Article 14-1 of the Securities and Exchange Act and assessment of the effectiveness of the internal control system. 4. Adoption or amendment, pursuant to Article 36-1 of the Securities and Exchange Act, of any handling procedures for material financial or business transactions, such as the acquisition or disposal of assets, derivatives trading, loans of funds to others, and endorsements or guarantees for others. 5. The offering, issuance, or private placement of equity-type securities. 6. If the board of directors does not have managing directors, the election or discharge of the chairman of the board of directors. `7.`The appointment or discharge of a financial, accounting, or internal audit officer. 8. A donation to a related party or a major donation to a non-related party, provided that a public-interest donation of disaster relief that is made for a major natural disaster may be submitted to the following board of directors meeting for retroactive recognition. 9. Any matter that, under Article 14-3 of the Securities and Exchange Act or any other law, regulation, or bylaw, must be approved by resolution at a shareholders meeting or board meeting, or any material matter as may be prescribed by the competent authority. (The followings remain the same)	The matters listed below as they relate to this Corporation shall be raised for discussion at a board meeting: 1. The Corporation's business plan. 2. Annual and semi-annual financial reports, with the exception of semi-annual financial reports that are not required under relevant laws and regulations to be audited and attested by a certified public accountant (CPA). 3. Adoption or amendment of an internal control system pursuant to Article 14-1 of the Securities and Exchange Act and assessment of the effectiveness of the internal control system. 4. Adoption or amendment, pursuant to Article 36-1 of the Securities and Exchange Act, of any handling procedures for material financial or business transactions, such as the acquisition or disposal of assets, derivatives trading, loans of funds to others, and endorsements or guarantees for others. 5. The offering, issuance, or private placement of equity-type securities. 6. The appointment or discharge of a financial, accounting, or internal audit officer. 7. A donation to a related party or a major donation to a non-related party, provided that a public-interest donation of disaster relief that is made for a major natural disaster may be submitted to the following board of directors meeting for retroactive recognition. 8. Any matter that, under Article 14-3 of the Securities and Exchange Act or any other law, regulation, or bylaw, must be approved by resolution at a shareholders meeting or board meeting, or any material matter as may be prescribed by the competent authority. (The followings remain the same)	Addition in accordance with Article 7, Paragraph 1, Subparagraph 6 of the Regulations Governing Procedure for Board of Directors Meetings of Public Companies

The Company has appointed a corporate governance officer, who is responsible for handling requests from directors. Operating on the principle of providing timely and effective assistance to directors in carrying out their Article 18 duties, the corporate governance supervisor will endeavor to process requests within ten days.

The Company hasn’t appointed a corporate The Company governance supervisor ( ~~General Manager’s~~ has appointed ~~Office)~~ , who is responsible for handling a corporate requests from directors. Operating on the governance principle of providing timely and effective supervisor as assistance to directors in carrying out their of 13 March duties, the corporate governance supervisor 2023, and the will endeavor to process requests within ten amendment is days made accordingly.

Attachment 6

CHANG TYPE INDUSTRIAL CO., LTD.

Cross-Reference Table on Articles of the “Articles of Incorporation”

Articles		After the Amendment	Before the Amendment	Reason for amendment
Article 12		Shareholders' meeting shall be of two kinds which are regular meeting of shareholders and special meeting of shareholders. Regular meeting of shareholders shall be held at least once every year and shall be convened within six months after close of each fiscal year. A notice to convene a regular meeting of shareholders shall be given to each shareholder no later than 30 days prior to the scheduled meeting date. Special meeting of shareholders shall be held when necessary and a notice to convene a special meeting of shareholders shall be given to each shareholder no later than 15 days prior to the scheduled meeting date. The notice of the shareholders’ meeting may be given by means of electronic transmission, after obtaining a prior consent from the recipient(s). The notice of the shareholders’ meeting to be given by an issuer to shareholders who own less than 1,000 shares of nominal stocks may be given in the form of a public announcement. The Company’s shareholders’ meeting can be held by means of visual communication network or other methods promulgated by the central competent authority.	Shareholders' meeting shall be of two kinds which are regular meeting of shareholders and special meeting of shareholders. Regular meeting of shareholders shall be held at least once every year and shall be convened within six months after close of each fiscal year. A notice to convene a regular meeting of shareholders shall be given to each shareholder no later than 30 days prior to the scheduled meeting date. Special meeting of shareholders shall be held when necessary and a notice to convene a special meeting of shareholders shall be given to each shareholder no later than 15 days prior to the scheduled meeting date. The notice of the shareholders’ meeting may be given by means of electronic transmission, after obtaining a prior consent from the recipient(s). The notice of the shareholders’ meeting to be given by an issuer to shareholders who own less than 1,000 shares of nominal stocks may be given in the form of a public announcement.	Addition of video conference convening.
Article 14		The shareholders’ meeting shall be convened by the board of directors, with the chairman of the board serving as the chairperson of the meeting, except as otherwise provided in the Company Act. In case the chairman of the board of directors is absent, the vice	The shareholders’ meeting shall be convened by the board of directors, with the chairman of the board serving as the chairperson of the meeting, except as otherwise provided in the Company Act. In case the chairman of the board of directors is absent, the chairman of the board of directors shall	Addition of vice chairman

		chairman shall act as the chairman. If both the chairman and vice chairman are absent,the chairman of the board of directors shall designate one of the directors. In the absence of such a designation, the directors shall elect from among themselves an acting chairperson of the board of directors. If the shareholders' meeting is convened by any other person than the board of directors, the election of chairperson of the meeting shall be handled in accordance with Article 182-1 of the CompanyAct.	designate one of the directors. In the absence of such a designation, the directors shall elect from among themselves an acting chairperson of the board of directors. If the shareholders' meeting is convened by any other person than the board of directors, the election of chairperson of the meeting shall be handled in accordance with Article 182-1 of the Company Act.
Chapter 4		Chapter 4 Directors	Chapter 4 Directors and Supervisors	In accordance with the amendments to the Securities and Exchange Act and text modification.
Article 18		The Company shall have 5 to 9 directors with the term of three years. A candidates nomination system is adopted for election of the directors of the company. The shareholders shall elect the directors from among thenominees listed in the roster of director candidates. The percentage of shareholdings of all the directors is subject to the provisions separately prescribed by the competent authorities of securities affairs. In accordance with Article 14-2 of the Securities and Exchange Act, the number of independent directors shall not be shall not be less than two and shall not be less than one-fifth of the total number of directors. Regulations governing the professional qualifications, restrictions on shareholdings and concurrent positions held, assessment of independence, method of nomination, and other matters for compliance with respect to independent directors shall be prescribed by the Securities and Exchange Act and relevant laws and regulations. The Company shall enroll the directors in liability insurance with respect to liabilities or claims for damages, resulting from exercising	The Company shall have 5 to 9 directors with the term of three years. A candidates nomination system is adopted for election of the directors of the company. The shareholders shall elect the directors from among the persons with disposing capacity. The percentage of shareholdings of all the directors is subject to the provisions separately prescribed by the competent authorities of securities affairs. In accordance with Article 14-2 of the Securities and Exchange Act, the number of independent directors shall not be shall not be less than two and shall not be less than one-fifth of the total number of directors. Regulations governing the professional qualifications, restrictions on shareholdings and concurrent positions held, assessment of independence, method of nomination, and other matters for compliance with respect to independent directors shall be prescribed by the Securities and Exchange Act and relevant laws and regulations. The Company shall enroll the directors in liability insurance with respect to liabilities or claims for damages, resulting from exercising their duties during their terms of office. The Company may establish an audit	In accordance with the amendments to the Company Act and text modification.

		their duties during their terms of office.	committee in lieu of a supervisor in accordance with Article 14-4 of the Securities and Exchange Act. In case a supervisor is appointed, he/she shall, ipso facto, be discharged from the office of supervisor and the provisions relating to the supervisor in this charter shall become invalid.
Article 21		The directors shall organize the board of directors. The board of directors shall elect a chairman and a vice chairman of the board directors from among the directors by a majority vote at a meeting attended by over two-thirds of the directors to execute all matters of the Company in accordance with applicable laws and regulations, the Articles of Incorporation, and resolutions of the shareholders' meetingand the board of directors.	The directors shall organize the board of directors. The board of directors shall elect a chairman of the board directors from among the directors by a majority vote at a meeting attended by over two- thirds of the directors to execute all matters of the Company in accordance with applicable laws and regulations, the Articles of Incorporation, and resolutions of the shareholders' meeting and the board of directors.	Adding one vice chairman.
Article 22		The operational guidelines and other important matters of the company shall be determined by the board of directors. Except for the first meeting of each term of the board of directors shall be convened in accordance with Article 203 of the Company Actand other regulations, the meetings of the board of directors shall be convened by the chairman of the board of directors. In case the chairman of the board of directors is on leave or absent or can not exercise his power and authority for any cause,the vice chairman shall act as the chairman. If the vice chairman is also unable to perform the duties, the chairman of the board of directors shall designate one of the directors. In the absence of such a designation, the directors shall elect from among themselves an acting chairperson of the board of directors. In calling a meeting of the board of directors, a notice shall be given to each director no later than 7 days prior to the scheduled meeting date. In the case of emergency, a meeting of the board of directors may be convened at anytime.	The operational guidelines and other important matters of the company shall be determined by the board of directors. Except for the first meeting of each term of the board of directors shall be convened in accordance with Article 203 of the Company Act, the meetings of the board of directors shall be convened by the chairman of the board of directors. In case the chairman of the board of directors is on leave or absent or can not exercise his power and authority for any cause, the chairman of the board of directors shall designate one of the directors. In the absence of such a designation, the directors shall elect from among themselves an acting chairperson of the board of directors. In calling a meeting of the board of directors, a notice shall be given to each director no later than 7 days prior to the scheduled meeting date. In the case of emergency, a meeting of the board of directors may be convened at any time.	Text modification and addition of vice chairman proxy duties.

The Company’s fiscal year is from 1 The Company’s fiscal year is from 1 January to 31 December. At the close January to 31 December. At the close of of each fiscal year, the Company each fiscal year, the Company shall shall prepare and present the prepare and present the following following statements and records to statements and records to the Board of the Board of Directors for approval Directors for approval and submitted to and submitted to the competent the competent authority for recordation: authority for recordation: 1. Business Report Text Article 29 1. Business Report 2. Financial Statements modification 2. Financial Statements 3. Surplus earning distribution or loss 3. Surplus earning distribution or off-setting proposals. loss off-setting proposals. The aforementioned financial The aforementioned reports shall be statements shall be submitted to the submitted to the Board of Directors Board of Directors for approval upon for approval upon approval of the approval of the Audit Committee. Audit Committee If the company has made profit in the If the company has made profit in the year, appropriate no less than 1% as year, appropriate no less than 1% as employees’ profit-sharing employees’ profit-sharing compensation, and no more than 5% compensation, and no more than 5% as as directors’ profit-sharing directors’ profit-sharing compensation. compensation. The company shall The company shall appropriate for appropriate for covering covering carryforward loss (including In accordance carryforward loss (including adjustment amount of retained with the adjustment amount of retained earnings), where applicable. Employees’ earnings), where applicable. compensation may be distributed in the amendments Article 30 Employees’ compensation may be form of stock or cash. Employees, to the distributed in the form of stock or including the employees of parents or Company Act cash. Employees, including the subsidiaries of the company meeting and text employees of parents or subsidiaries certain specific requirements, are modification. of the company meeting certain entitled to receive employees’ profitspecific requirements, are entitled to sharing compensation. receive employees’ profit-sharing Prior to the establishment of the audit compensation. committee, the remuneration of the supervisor shall be allocated according to the distribution ratio specified in paragraph 1. When allocating its surplus profits When allocating its surplus profits after after having paid all taxes and dues, having paid all taxes and dues, the the company’s accumulated losses company’s accumulated losses shall shall have been covered and the have been covered and the company company shall set aside 10% of said shall set aside 10% of said profits as profits as legal reserve. When the legal reserve. In addition, special legal reserve reaches the actual paidreserves shall be set aside or reversed in in capital of the company, the legal accordance with the competent reserve may not be appropriated. In authority. The remaining balance, addition, special reserves shall be set together with the accumulated aside or reversed in accordance with undistributed earnings, shall be Text Article 30-1 the need of competent authority. The formulated into a profit distribution remaining balance, together with the proposal by the board of directors, and modification accumulated undistributed earnings, submitted to the shareholders' meeting shall be formulated into a profit for resolution on the distribution of distribution proposal by the board of dividends to shareholders. directors, and submitted to the If the distribution of dividends to shareholders' meeting for resolution shareholders in the preceding paragraph, on the distribution of dividends to either in whole or in part, is to be shareholders. distributed in cash, it shall be a resolution adopted by a majority of the The preceding dividends or capital directors present who represent twosurplus or legal reserve (if the reserve thirds or more of the total number of

The preceding dividends or capital surplus or legal reserve (if the reserve - exceeds twenty five percent of the

actual paid-in capital), is to be directors of the company and shall be distributed in cash, it shall be a reported to the shareholders' meeting. resolution adopted by a majority of Where such legal reserve in the the directors present who represent preceding paragraph amounts to the total two-thirds or more of the total paid-in capital, the Company may. number of directors of the company The dividend policy of the company is and shall be reported to the determined by the Board of Directors shareholders' meeting. based on the operational plans, Where such legal reserve in the investment plans, capital budgeting, preceding paragraph amounts to the changes in the internal and external total paid-in capital, the Company environmental. The Company operates may. in a capital-intensive industry and is The dividend policy of the company currently in a stage of operational is determined by the Board of growth. It requires retained earnings to Directors based on the operational meet the funding needs for operational plans, investment plans, capital growth and investments. Therefore, the budgeting, changes in the internal Company adopts a residual dividend and external environmental. The policy at this stage. When distributing Company operates in a capitaldividends as mentioned above, the intensive industry and is currently in annual cash dividend paid to a stage of operational growth. It shareholders shall not be less than 5% of requires retained earnings to meet the the total cash and stock dividends funding needs for operational growth distributed in the current fiscal year. and investments. Therefore, the If the company suffers no loss, it may Company adopts a residual dividend distribute the entire or a portion of the policy at this stage. When paid-in capital as prescribed by the distributing dividends as mentioned above, the annual cash dividend paid Companies Act and legal reserve (in to shareholders shall not be less than excess of 25% of the paid-in capital) in 5% of the total cash and stock cash. This distribution shall be subject dividends distributed in the current to a resolution adopted by a majority of fiscal year. the directors present who represent twoIf the company suffers no loss, it may distribute the entire or a portion thirds or more of the total number of of the paid-in capital as prescribed directors of the company and shall be by the Companies Act and legal reported to the shareholders' meeting. reserve (in excess of 25% of the paid-in capital) in cash. This distribution shall be subject to a resolution adopted by a majority of the directors present who represent two-thirds or more of the total number of directors of the company and shall be reported to the shareholders' meeting. The Articles of Incorporation were The Articles of Incorporation were established on 14 December 1990. established on 14 December 1990. The first amendment was made on 22 The first amendment was made on 22 June 1992. June 1992. The second amendment was made on The second amendment was made on 14 14 May 1995. May 1995. Addition of Article 33 revision date The third amendment was made on The third amendment was made on 18 18 August 1997. August 1997. and frequency ……………… ……………… The eighteenth amendment was The seventeenth amendment was made made on 22 June 2012. on 25 June 2010. The nineteenth amendment was The eighteenth amendment was made on

	made on 28 June 2016. The twentieth amendment was made on 27 August 2019. The twenty-first amendment was made on 27 June 2022. The twenty-second amendment was made on 21 June 2024.	22 June 2012. The nineteenth amendment was made on 28 June 2016. The twentieth amendment was made on 27 August 2019. The twenty-first amendment was made on 27 June 2022.

Articles of Incorporation of CHANG TYPE INDUSTRIAL CO., LTD. Chapter 1 General Provisions

Article 1: The Company shall be incorporated under the Company Act of the Republic of China, and its name shall be CHANG TYPE INDUSTRIAL CO., LTD.

Article 2: The Company's business scope includes:

  1. Manufacturing and trading of hand tools, electrical machinery, motors, power tools, automated control systems, computer machinery, and electric testing instruments. (Excluding measuring devices)

  2. Design, manufacturing, and trading of various types of molds and fixtures.

  3. 3.Manufacturing, processing, and trading of woodworking machinery, machinery, and hardware components.

  4. F401010 International Trade.

  5. CD01030 Motor Vehicles and Parts Manufacturing.

  6. F114030 Wholesale of Motor Vehicle Parts and Motorcycle Parts, Accessories.

  7. CB01010 Mechanical Equipment Manufacturing.

  8. F113010 Wholesale of Machinery.

  9. CB01990 Other Machinery Manufacturing (Horticultural Machinery Parts).

  10. Import and export trading business related to the raw materials of the aforementioned products.

  11. ZZ99999 All business activities that are not prohibited or restricted by law, except those that are subject to special approval.

Article 3: The Company shall have its head office in Taichung City, the Republic of China, and may, pursuant to a resolution adopted at the meeting of the Board of Directors, set up branch offices within or outside the territory of the Republic of China when deemed necessary.
Article 4: Public announcements of the Company shall be made according to Article 28 of the Company Act.
Article 4-1: The total amount of investments may exceed forty percent of the amount of the paid-in capital and the board of directors is authorized to execute such investments.
Article 4-2: The Company may make endorsements/guarantees for others and the operation shall comply with the operational procedures for endorsements/guarantees established by the company.
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 - Chapter 2 Capital Stock
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Article 5: The total capital stock of the company shall be in the amount of NT$ 1.18 billion, divided into 118 million shares, at NT$ 10 each, to be issued in installment. The issuance of unissued shares shall be determined by the Board of Directors based on actual circumstances.
Article 5-1: An issuer is required to obtain the consent of at least two-thirds of the voting rights represented at a shareholders meeting attended by shareholders representing a majority of the total issued shares in buyback for transferring shares to its employees at a price lower than the actual repurchase average price or issuance of employee stock warrants at a price lower than the market price on the issuance date.
Article 6: The Company’s share certificate shall be affixed with the signatures or personal seals of the director representing the company and shall be duly certified or authenticated by competent authority under the laws before issuance thereof.
The Company may be exempted from printing any share certificate for the shares issued and shall register the issued shares with a centralized securities depositary enterprise and follow the regulations of that enterprise.

Article 7: Except as otherwise provided by laws and regulations governing securities, the handling of the company's stock affairs shall comply with the “Regulations Governing the Administration of Shareholder Services of Public Companies”.
Article 8: (Deleted)
Article 9: (Deleted)
Article 10: (Deleted)
Article 11: The share transfer registration shall be suspended within 60 days prior to the convening date of a regular shareholders' meeting, or within 30 days prior to the convening date of a special shareholders' meeting, or within 5 days prior to the target date fixed by the issuing company for distribution of dividends, bonus or other benefits.

Chapter 3 Shareholders' Meeting

Article 12: Shareholders' meeting shall be of two kinds which are regular meeting of shareholders and special meeting of shareholders. Regular meeting of shareholders shall be held at least once every year and shall be convened within six months after close of each fiscal year. A notice to convene a regular meeting of shareholders shall be given to each shareholder no later than 30 days prior to the scheduled meeting date. Special meeting of shareholders shall be held when necessary and a notice to convene a special meeting of shareholders shall be given to each shareholder no later than 15 days prior to the scheduled meeting date.

The notice of the shareholders’ meeting may be given by means of electronic transmission, after obtaining a prior consent from the recipient(s). The notice of the shareholders’ meeting to be given by an issuer to shareholders who own less than 1,000 shares of nominal stocks may be given in the form of a public announcement.

Article 13: A shareholder may, in accordance with the Company Act and the Regulations Governing the Use of Proxies for Attendance at Shareholder Meetings of Public Companies, appoint a proxy to attend a shareholders’ meeting in his/her/its behalf by executing a power of attorney if the shareholder is unable to do so in person for any cause.
Article 14: The shareholders’ meeting shall be convened by the board of directors, with the chairman of the board serving as the chairperson of the meeting, except as otherwise provided in the Company Act. In case the chairman of the board of directors is absent, the chairman of the board of directors shall designate one of the directors. In the absence of such a designation, the directors shall elect from among themselves an acting chairperson of the board of directors.

If the shareholders' meeting is convened by any other person than the board of directors, the election of chairperson of the meeting shall be handled in accordance with Article 182-1 of the Company Acr.

Article 15: Except for those that are restricted or in the circumstances otherwise provided for in paragraph 2 of Article 179 of the Company Act shall have no voting power, the shareholders of the company shall have one voting power in respect of each share in his/her/its possession.
Article 16: Resolutions at a shareholders' meeting shall, unless otherwise provided for by the Company Act, be adopted by a majority vote of the shareholders present, who represent more than one-half of the total number of voting shares.
Article 17: Resolutions adopted at a shareholders' meeting shall be recorded in the minutes of the meeting and

shall be handled in accordance with Article 183 of the Company Act.

Chapter 4 Directors and Supervisors

Article 18 :The Company shall have 5 to 9 directors with the term of three years. A candidates nomination system is adopted for election of the directors of the company. The shareholders shall elect the directors from among the nominees listed in the roster of director candidates. The percentage of shareholdings of all the directors is subject to the provisions separately prescribed by the competent authorities of securities affairs.

In accordance with Article 14-2 of the Securities and Exchange Act, the number of independent directors shall not be shall not be less than two and shall not be less than one-fifth of the total number of directors. Regulations governing the professional qualifications, restrictions on shareholdings and concurrent positions held, assessment of independence, method of nomination, and other matters for compliance with respect to independent directors shall be prescribed by the Securities and Exchange Act and relevant laws and regulations.

The Company shall enroll the directors in liability insurance with respect to liabilities or claims for damages, resulting from exercising their duties during their terms of office.

The Company may establish an audit committee in lieu of a supervisor in accordance with Article 14-4 of the Securities and Exchange Act. In case a supervisor is appointed, he/she shall, ipso facto, be discharged from the office of supervisor and the provisions relating to the supervisor in this charter shall become invalid.

Article 18-1: (Deleted)

Article 19: When the number of vacancies in the board of directors of a company equals to one third of the total number of directors or when all independent directors have been dismissed, the board of directors shall call, within 60 days, a special meeting of shareholders to elect succeeding directors to fill the vacancies for the remaining term of directorship. When an independent director is dismissed for any reason, resulting in a number of directors lower than that required under this charter, a by-election for independent director shall be held at the next following shareholders meeting. The term of office for an independent director elected to fill a vacancy shall be limited to the remaining term of the original independent director.

In case no election of new directors is effected after expiration of the term of office of existing directors, the term of office of out-going directors shall be extended until the time new directors have been elected and assumed their office. However, the competent authority may, ex officio, order the company to elect new directors within a given time limit; and if no re-election is effected after expiry of the given time limit, the out-going directors shall be discharged ipso facto from such expiration date.

Article 20: (Deleted)

Article 21: The directors shall organize the board of directors. The board of directors shall elect a chairman of the board directors from among the directors by a majority vote at a meeting attended by over two-thirds of the directors to execute all matters of the Company in accordance with applicable laws and regulations, the Articles of Incorporation, and resolutions of the shareholders' meeting and the board of directors.

Article 22: The operational guidelines and other important matters of the company shall be determined by the board of directors. Except for the first meeting of each term of the board of directors shall be convened in accordance with Article 203 of the Company Act, the meetings of the board of directors shall be convened by the chairman of the board of directors. In case the chairman of the board of directors is on leave or absent or can not exercise his power and authority for any cause, the chairman of the board of directors shall designate one of the directors. In the absence of such a designation, the directors shall elect from among themselves an acting chairperson of the board of directors.

In calling a meeting of the board of directors, a notice shall be given to each director no later than 7 days prior to the scheduled meeting date. In the case of emergency, a meeting of the board of directors may be convened at any time.

The notice in the preceding paragraph may be effected in writing, e-mail or fax.

Article 23: Unless otherwise provided for in the Company Act, resolutions of the Board of Directors shall be adopted by a majority of the directors at a meeting attended by a majority of the directors. In case a director appoints another director to attend a meeting of the board of directors in his/her behalf, he/she shall, in each time, issue a written proxy and state therein the scope of authority with reference to the subjects to be discussed at the meeting. A director may accept the appointment to act as the proxy referred of one other director only.

In case a meeting of the board of directors is proceeded via visual communication network, then the directors taking part in such a visual communication meeting shall be deemed to have attended the meeting in person.

Resolutions adopted at a board meeting shall be recorded in the minutes of the meeting and handled in accordance with the Rules of Procedure for Board of Directors Meetings established by the company.

Article 24: (Deleted)

Article 25: (Deleted)

Article 25-1: The remuneration and travel allowance of chairman and directors shall be determined by the board of directors based on the level of involvement and contribution to the operations of the company and may be paid at such level as generally adopted by the enterprises of the same industry.
Article 25-2: The Company may establish a remuneration committee or other functional committees in consideration of the business operation.
The Company has established an audit committee in accordance with Article 14-4 of the Securities Exchange Act. The audit committee shall be composed of the entire number of independent directors. The audit committee and its members shall be responsible for exercising powers of supervisors prescribed by the Company Act, the Securities Exchange Act and other applicable laws and regulations.

Chapter 5 Managers and Employees

Article 26: The Company may have one president and several vice presidents, assistant general manager, managers, factory directors and special assistant of the President’s Office. Appointment, discharge and the remuneration shall be adopted by a majority of the directors at a meeting attended by a majority of the directors.
Article 27: The Company may appoint consultants and key personnel upon resolution of the board meeting. Article 28: (Deleted)

Chapter 6 Accounting

Article 29: The Company’s fiscal year is from 1 January to 31 December. At the close of each fiscal year, the Company shall prepare and present the following statements and records to the Board of Directors for approval and submitted to the competent authority for recordation:
Business Report
Financial Statements
Surplus earning distribution or loss off-setting proposals.
The aforementioned financial statements shall be submitted to the Board of Directors for approval upon approval of the Audit Committee.
Article 30: If the company has made profit in the year, appropriate no less than 1% as employees’ profit-sharing compensation, and no more than 5% as directors’ profit-sharing compensation. The company shall appropriate for covering carryforward loss (including adjustment amount of retained earnings), where applicable. Employees’ compensation may be distributed in the form of stock or cash. Employees, including the employees of parents or subsidiaries of the company meeting certain specific requirements, are entitled to receive employees’ profit-sharing compensation.

The profit for the year referred to in the preceding paragraph shall refer to the profit before tax for the year before the distribution of employees’ compensation and remuneration to directors.

Prior to the establishment of the audit committee, the remuneration of the supervisor shall be allocated according to the distribution ratio specified in paragraph 1.

Article 30-1: When allocating its surplus profits after having paid all taxes and dues, the company’s accumulated losses shall have been covered and the company shall set aside 10% of said profits as legal reserve. In addition, special reserves shall be set aside or reversed in accordance with the competent authority. The remaining balance, together with the accumulated undistributed earnings, shall be formulated into a profit distribution proposal by the board of directors, and submitted to the shareholders' meeting for resolution on the distribution of dividends to shareholders.

If the distribution of dividends to shareholders in the preceding paragraph, either in whole or in part, is to be distributed in cash, it shall be a resolution adopted by a majority of the directors present who represent two-thirds or more of the total number of directors of the company and shall be reported to the shareholders' meeting.

Where such legal reserve in the preceding paragraph amounts to the total paid-in capital, the Company may.

The dividend policy of the company is determined by the Board of Directors based on the operational plans, investment plans, capital budgeting, changes in the internal and external environmental. The Company operates in a capital-intensive industry and is currently in a stage of operational growth. It requires retained earnings to meet the funding needs for operational growth and investments. Therefore, the Company adopts a residual dividend policy at this stage. When distributing dividends as mentioned above, the annual cash dividend paid to shareholders shall not be less than 5% of the total cash and stock dividends distributed in the current fiscal year.

If the company suffers no loss, it may distribute the entire or a portion of the paid-in capital as prescribed by the Companies Act and legal reserve (in excess of 25% of the paid-in capital) in cash. This distribution shall be subject to a resolution adopted by a majority of the directors present who represent two-thirds or more of the total number of directors of the company and shall be reported to the shareholders' meeting.

Chapter 7 Supplementary Provisions

Article 31: The organization and operational procedures of the company shall be determined separately by the Board of Directors.
Article 32: In regard to all matters not provided for in these Articles of Incorporation, the Company Act shall govern.

Article 33: The Articles of Incorporation were established on 14 December 1990. The first amendment was made on 22 June 1992. The second amendment was made on 14 May 1995. The third amendment was made on 18 August 1997. The fourth amendment was made on 15 June 1998. The fifth amendment was made on 5 May 1999. The sixth amendment was made on 15 July 1999. The seventh amendment was made on 31 May 2000. The eighth amendment was made on 15 June 2001. The ninth amendment was made on 6 May 2002. The tenth amendment was made on 13 June 2003. The eleventh amendment was made on 11 June 2004. The twelfth amendment was made on 13 June 2005. The thirteenth amendment was made on 15 June 2006. The fourteenth amendment was made on 28 December 2006. The fifteenth amendment was made on 13 June 2008. The sixteenth amendment was made on 16 June 2009. The seventeenth amendment was made on 25 June 2010. The eighteenth amendment was made on 22 June 2012. The nineteenth amendment was made on 28 June 2016. The twentieth amendment was made on 27 August 2019. The twenty-first amendment was made on 27 June 2022.

CHANG TYPE INDUSTRIAL CO., LTD.

Chairman: CHANG, CHIN-CHIN

Attachment 7

CHANG TYPE INDUSTRIAL CO., LTD. Rules of Procedure for Shareholder Meetings

Amended on 27 June 2022 Amended on 27 August 2021 Amended on 29 June 2020

Article 1. To establish a strong governance system and sound supervisory capabilities for the Company's shareholders meetings, and to strengthen management capabilities, these Rules are adopted pursuant to the Corporate Governance Best-Practice Principles for TWSE/GTSM Listed Companies.
Article 2. The rules of procedures for the Company's shareholders meetings, except as otherwise provided by law, regulation, or the articles of incorporation, shall be as provided in these Rules.
Article 3. Unless otherwise provided by law or regulation, the Company's shareholders meetings shall be convened by the board of directors.

The Company shall prepare electronic versions of the shareholders meeting notice and proxy forms, and the origins of and explanatory materials relating to all proposals, including proposals for ratification, matters for deliberation, or the election or dismissal of directors or supervisors, and upload them to the Market Observation Post System (MOPS) before 30 days before the date of a regular shareholders meeting or before 15 days before the date of a special shareholders meeting. This Corporation shall prepare electronic versions of the shareholders meeting agenda and supplemental meeting materials and upload them to the MOPS before 21 days before the date of the regular shareholders meeting or before 15 days before the date of the special shareholders meeting. In addition, before 15 days before the date of the shareholders meeting, the Company shall also have prepared the shareholders meeting agenda and supplemental meeting materials and made them available for review by shareholders at any time. The meeting agenda and supplemental materials shall also be displayed at the company and distributed on-site at the meeting.

The reasons for convening a shareholders meeting shall be specified in the meeting notice and public announcement. With the consent of the addressee, the meeting notice may be given in electronic form. Election or dismissal of directors or supervisors, amendments to the articles of incorporation, reduction of capital, application for the approval of ceasing its status as a public company, approval of competing with the company by directors, surplus profit distributed in the form of new shares, reserve distributed in the form of new shares, the dissolution, merger, or demerger of the corporation, or any matter under Article 185, paragraph 1 of the Company Act, Articles 26-1 and 43-6 of the Securities Exchange Act, Articles 56-1 and 60-2 of the Regulations Governing the Offering and Issuance of Securities by Securities Issuers shall be set out and the essential contents explained in the notice of the reasons for convening the shareholders meeting. None of the above matters may be raised by an extraordinary motion.

Where re-election of all directors as well as their inauguration date is stated in the notice of the reasons for convening the shareholders meeting, after the completion of the re-election in said meeting such inauguration date may not be altered by any extraordinary motion or otherwise in the same meeting. A shareholder holding one percent or more of the total number of issued shares may submit to the Company a proposal for discussion at a regular shareholders meeting. The number of items so proposed is limited to one only, and no proposal containing more than one item will be included in the meeting agenda. When the circumstances of any subparagraph of Article 172-1, paragraph 4 of the Company Act apply to a proposal put forward by a shareholder, the board of directors may exclude it from the agenda. A shareholder may propose a recommendation for urging the corporation to promote public interests or fulfill its social responsibilities, provided procedurally the number of items so proposed is limited only to one in accordance with Article 172-1 of the Company Act, and no proposal containing more than one item will be included in the meeting agenda.

Prior to the book closure date before a regular shareholders meeting is held, the Company shall publicly announce its acceptance of shareholder proposals in writing or electronically, and the location and time period for their submission; the period for submission of shareholder proposals may not be less than 10 days.

Shareholder-submitted proposals are limited to 300 words, and no proposal containing more than 300 words will be included in the meeting agenda. The shareholder making the proposal shall be present in person or by proxy at the regular shareholders meeting and take part in discussion of the proposal. Prior to the date for issuance of notice of a shareholders meeting, the Company shall inform the shareholders who submitted proposals of the proposal screening results and shall list in the meeting notice the proposals that conform to the provisions of this article. At the shareholders meeting the board of directors shall explain the reasons for exclusion of any shareholder proposals not included in the agenda.

Article 4. For each shareholders meeting, a shareholder may appoint a proxy to attend the meeting by providing the proxy form issued by the Company and stating the scope of the proxy's authorization. Shareholder may issue only one proxy form and appoint only one proxy for any given shareholders meeting and shall deliver the proxy form to the Company before five days before the date of the shareholders meeting. When duplicate proxy forms are delivered, the one received earliest shall prevail unless a declaration is made to cancel the previous proxy appointment.
After a proxy form has been delivered to the Company, if the shareholder intends to attend the meeting in person or to exercise voting rights by correspondence or electronically, a written notice of proxy cancellation shall be submitted to the Company before two business days before the meeting date. If the cancellation notice is submitted after that time, votes cast at the meeting by the proxy shall prevail.
Article 5. The venue for a shareholders meeting shall be the premises of the Company, or a place easily accessible to shareholders and suitable for a shareholders meeting. The meeting may begin no earlier than 9 a.m. and no later than 3 p.m. Full consideration shall be given to the opinions of the independent directors with respect to the place and time of the meeting.
Article 6. The Company shall specify in its shareholders meeting notices the time during which attendance registrations for shareholders, solicitors and proxies (collectively "shareholders") will be accepted, the place to register for attendance, and other matters for attention.
The time during which shareholder attendance registrations will be accepted, as stated in the preceding paragraph, shall be at least 30 minutes prior to the time the meeting commences. The place at which attendance registrations are accepted shall be clearly marked and a sufficient number of suitable personnel assigned to handle the registrations. For virtual shareholders meetings, shareholders may begin to register on the virtual meeting platform 30 minutes before the meeting starts.
Shareholders, solicitors and proxies (collectively “ shareholders ” ) shall attend shareholders meetings based on attendance cards, sign-in cards, or other certificates of attendance. The Company may not arbitrarily add requirements for other documents beyond those showing eligibility to attend presented by shareholders. Solicitors soliciting proxy forms shall also bring identification documents for verification.

The Company shall furnish the attending shareholders with an attendance book to sign, or attending shareholders may hand in a sign-in card in lieu of signing in.

The Company shall furnish attending shareholders with the meeting agenda book, annual report, attendance card, speaker's slips, voting slips, and other meeting materials. Where there is an election of directors or supervisors, pre-printed ballots shall also be furnished.When the government or a juristic person is a shareholder, it may be represented by more than one representative at a shareholders meeting. When a juristic person is appointed to attend as proxy, it may designate only one person to represent it in the meeting.

Article 7. If a shareholders meeting is convened by the board of directors, the meeting shall be chaired by the chairman of the board. When the chairman of the board is on leave or for any reason unable to exercise the powers of the chairman, the vice chairman shall act in place of the chairman; if there is no vice chairman or the vice chairman also is on leave or for any reason unable to exercise the powers of the vice chairman, the chairman shall appoint one of the managing directors to act as chair, or, if there are no managing directors, one of the directors shall be appointed to act as chair. Where the chairman does not make such a designation, the directors shall select from among themselves one person to serve as chair.

When a director serves as chair, the director shall be one who has held that position for six months or more and who understands the financial and business conditions of the company. The same shall be true for a representative of a juristic person director that serves as chair.

It is advisable that shareholders meetings convened by the board of directors be chaired by the chairman of the board in person and attended by a majority of the directors, at least one independent director in person, and at least one member of each functional committee on behalf of the committee. The attendance shall be recorded in the meeting minutes.

If a shareholders meeting is convened by a party with power to convene but other than the board of directors, the convening party shall chair the meeting. When there are two or more such convening parties, they shall mutually select a chair from among themselves.

The Company may appoint its attorneys, CPAs, or related persons retained by it to attend a shareholders meeting in a non-voting capacity.
Article 8. The Company shall make an uninterrupted audio and video recording of the registration procedure, the proceedings of the shareholders meeting, and the voting and vote counting procedures. The recorded materials shall be retained for at least one year. If, however, a shareholder files a lawsuit pursuant to Article 189 of the Company Act, the recording shall be retained until the conclusion of the litigation.
Article 9. Attendance at shareholders meetings shall be calculated based on numbers of shares. The number of shares in attendance shall be calculated according to the shares indicated by the attendance book and sign-in cards handed in, and the shares checked in on the virtual meeting platform, plus the number of shares whose voting rights are exercised by correspondence or electronically.
The chair shall call the meeting to order at the appointed meeting time and disclose information concerning the number of nonvoting shares and number of shares represented by shareholders attending the meeting. However, when the attending shareholders do not represent a majority of the total number of issued shares, the chair may announce a postponement, provided that no more than two such postponements, for a combined total of no more than one hour, may be made. If the quorum is not met after two postponements and the attending shareholders still represent less than one-third of the total number of issued shares, the chair shall declare the meeting adjourned.
If the quorum is not met after two postponements as referred to in the preceding paragraph, but the attending shareholders represent one-third or more of the total number of issued shares, a tentative resolution may be adopted pursuant to Article 175, paragraph 1 of the Company Act. All shareholders shall be notified of the tentative resolution and another shareholders meeting shall be convened within one month.

When, prior to conclusion of the meeting, the attending shareholders represent a majority of the total number of issued shares, the chair may resubmit the tentative resolution for a vote by the shareholders meeting pursuant to Article 174 of the Company Act.

Article 10. If a shareholders meeting is convened by the board of directors, the meeting agenda shall be set by the board of directors. Votes shall be cast on each separate proposal in the agenda (including extraordinary motions and amendments to the original proposals set out in the agenda). The meeting shall proceed in the order set by the agenda, which may not be changed without a resolution of the shareholders meeting.
The provisions in the preceding paragraph apply mutatis mutandis to a shareholders meeting convened by a party with the power to convene that is not the board of directors.
The chair may not declare the meeting adjourned prior to completion of deliberation on the meeting agenda of the preceding two paragraphs (including extraordinary motions), except by a resolution of the shareholders meeting. If the chair declares the meeting adjourned in violation of the rules of procedure, the other members of the board of directors shall promptly assist the attending shareholders in electing a new chair in accordance with statutory procedures, by agreement of a majority of the votes represented by the attending shareholders, and then continue the meeting.
The chair shall allow ample opportunity during the meeting for explanation and discussion of proposals and of amendments or extraordinary motions put forward by the shareholders; when the chair is of the opinion that a proposal has been discussed sufficiently to put it to a vote, the chair may announce the discussion closed, call for a vote, and schedule sufficient time for voting.
Article 11. Before speaking, an attending shareholder must specify on a speaker's slip the subject of the speech, his/her shareholder account number (or attendance card number), and account name. The order in which shareholders speak will be set by the chair.
A shareholder in attendance who has submitted a speaker's slip but does not actually speak shall be deemed to have not spoken. When the content of the speech does not correspond to the subject given on the speaker's slip, the spoken content shall prevail.
Except with the consent of the chair, a shareholder may not speak more than twice on the same proposal, and a single speech may not exceed 5 minutes. If the shareholder's speech violates the rules or exceeds the scope of the agenda item, the chair may terminate the speech.
When an attending shareholder is speaking, other shareholders may not speak or interrupt unless they have sought and obtained the consent of the chair and the shareholder that has the floor; the chair shall stop any violation.
When a juristic person shareholder appoints two or more representatives to attend a shareholders meeting, only one of the representatives so appointed may speak on the same proposal. After an attending shareholder has spoken, the chair may respond in person or direct relevant personnel to respond.
Article 12. Voting at a shareholders meeting shall be calculated based the number of shares. With respect to resolutions of shareholders meetings, the number of shares held by a shareholder with no voting rights shall not be calculated as part of the total number of issued shares. When a shareholder is an interested party in relation to an agenda item, and there is the likelihood that such a relationship would prejudice the interests of the company, that shareholder may not vote on that item, and may not exercise voting rights as proxy for any other shareholder.
The number of shares for which voting rights may not be exercised under the preceding paragraph shall not be calculated as part of the voting rights represented by attending shareholders. With the exception of a trust enterprise or a shareholder services agent approved by the competent securities authority, when one person is concurrently appointed as proxy by two or more shareholders, the voting rights represented by that proxy may not exceed three percent of the voting rights represented by the total number of issued shares. If that percentage is exceeded, the voting rights in excess of that percentage shall not be included in the calculation.

Article 13. A shareholder shall be entitled to one vote for each share held, except when the shares are restricted shares or are deemed non-voting shares under Article 179, paragraph 2 of the Company Act. When the company holds a shareholder meeting, it shall adopt exercise of voting rights by electronic means and may adopt exercise of voting rights by correspondence. When voting rights are exercised by correspondence or electronic means, the method of exercise shall be specified in the shareholders meeting notice. A shareholder exercising voting rights by correspondence or electronic means will be deemed to have attended the meeting in person, but to have waived his/her rights with respect to the extraordinary motions and amendments to original proposals of that meeting; it is therefore advisable that the company avoid the submission of extraordinary motions and amendments to original proposals.

A shareholder intending to exercise voting rights by correspondence or electronic means under the preceding paragraph shall deliver a written declaration of intent to the company before two days before the date of the shareholders meeting. When duplicate declarations of intent are delivered, the one received earliest shall prevail, except when a declaration is made to cancel the earlier declaration of intent.

After a shareholder has exercised voting rights by correspondence or electronic means, in the event the shareholder intends to attend the shareholders meeting in person or online, a written declaration of intent to retract the voting rights already exercised under Article 6.11.2 shall be made known to the Company, by the same means by which the voting rights were exercised, before two business days before the date of the shareholders meeting. If the notice of retraction is submitted after that time, the voting rights already exercised by correspondence or electronic means shall prevail. When a shareholder has exercised voting rights both by correspondence or electronic means and by appointing a proxy to attend a shareholders meeting, the voting rights exercised by the proxy in the meeting shall prevail.

Except as otherwise provided in the Company Act and in the Company's articles of incorporation, the passage of a proposal shall require an affirmative vote of a majority of the voting rights represented by the attending shareholders. At the time of a vote, for each proposal, the chair or a person designated by the chair shall first announce the total number of voting rights represented by the attending shareholders, followed by a poll of the shareholders. After the conclusion of the meeting, on the same day it is held, the results for each proposal, based on the numbers of votes for and against and the number of abstentions, shall be entered into the MOPS.

When there is an amendment or an alternative to a proposal, the chair shall present the amended or alternative proposal together with the original proposal and decide the order in which they will be put to a vote. When any one among them is passed, the other proposals will then be deemed rejected, and no further voting shall be required.

Vote monitoring and counting personnel for the voting on a proposal shall be appointed by the chair, provided that all monitoring personnel shall be shareholders of the Company. Vote counting for shareholders meeting proposals or elections shall be conducted in public at the place of the shareholders meeting. Immediately after vote counting has been completed, the results of the voting, including the statistical tallies of the numbers of votes, shall be announced on-site at the meeting, and a record made of the vote.

Article 14. The election of directors at a shareholders meeting shall be held in accordance with the applicable election and appointment rules adopted by the Company, and the voting results shall be announced on-site immediately, including the names of those elected as directors and the numbers of votes with which they were elected, and the names of directors not elected and number of votes they received. The ballots for the election referred to in the preceding paragraph shall be sealed with the signatures of the monitoring personnel and kept in proper custody for at least one year. If, however, a shareholder files a lawsuit pursuant to Article 189 of the Company Act, the ballots shall be retained until the conclusion of the litigation.

Article 15. Matters relating to the resolutions of a shareholders meeting shall be recorded in the meeting minutes. The meeting minutes shall be signed or sealed by the chair of the meeting and a copy distributed to each shareholder within 20 days after the conclusion of the meeting. The meeting minutes may be produced and distributed in electronic form.

The Company may distribute the meeting minutes of the preceding paragraph by means of a public announcement made through the MOPS.

The meeting minutes shall accurately record the year, month, day, and place of the meeting, the chair's full name, the methods by which resolutions were adopted, and a summary of the deliberations and their voting results (including the number of voting rights), and disclose the number of voting rights won by each candidate in the event of an election of directors or supervisors. The minutes shall be retained for the duration of the existence of the Company.

Article 16. On the day of a shareholders meeting, the Company shall compile in the prescribed format a statistical statement of the number of shares obtained by solicitors through solicitation and shall make an express disclosure of the same at the place of the shareholders meeting.
If matters put to a resolution at a shareholders meeting constitute material information under applicable laws or regulations or under Taiwan Stock Exchange Corporation (or Taipei Exchange Market) regulations, the Company shall upload the content of such resolution to the MOPS within the prescribed time period.
Article 17. Staff handling administrative affairs of a shareholders meeting shall wear identification cards or arm bands.

The chair may direct the proctors or security personnel to help maintain order at the meeting place. When proctors or security personnel help maintain order at the meeting place, they shall wear an identification card or armband bearing the word “Proctor”.

At the place of a shareholders meeting, if a shareholder attempts to speak through any device other than the public address equipment set up by the Company, the chair may prevent the shareholder from so doing.

When a shareholder violates the rules of procedure and defies the chair's correction, obstructing the proceedings and refusing to heed calls to stop, the chair may direct the proctors or security personnel to escort the shareholder from the meeting.

Article 18. When a shareholder violates the rules of procedure and defies the chair's correction, obstructing the proceedings and refusing to heed calls to stop, the chair may direct the proctors or security personnel to escort the shareholder from the meeting.

If the meeting venue is no longer available for continued use and not all of the items (including extraordinary motions) on the meeting agenda have been addressed, the shareholders meeting may adopt a resolution to resume the meeting at another venue.

A resolution may be adopted at a shareholders meeting to defer or resume the meeting within five days in accordance with Article 182 of the Company Act.
Article 19. These Rules shall take effect after having been submitted to and approved by a shareholders meeting. Subsequent amendments thereto shall be effected in the same manner.

Attachment 8

CHANG TYPE INDUSTRIAL CO., LTD. Shareholding of directors

Record date for suspension of share transfer: 23 April 2024	Record date for suspension of share transfer: 23 April 2024	Record date for suspension of share transfer: 23 April 2024	Record date for suspension of share transfer: 23 April 2024	Record date for suspension of share transfer: 23 April 2024	Record date for suspension of share transfer: 23 April 2024
Title	Name	Date of appointment	Term of office	Number of shares held as recorded in the shareholder register on the record date for suspension of share transfer.
				Number of shares held (share)	%
Chairman	CHANG, CHIN-CHIN	27 June 2022	3 years	18,080,201	22.94
Director	CHANG, HSIANG-I	27 June 2022	3 years	7,090,569	9.00
Director	LUO, SHU-DUAN	27 June 2022	3 years	22,400	0.03
Independent Director	LIN, SIOU-MEI	27 June 2022	3 years	1,225	0
Independent Director	CHEN, YONG-YAO	27 June 2022	3 years	-	-
Independent Director	KO, CHEN-EN	27 June 2022	3 years	-	-
Independent Director	WANG, MING-JHIH	27 June 2022	3 years	-	-
Total				25,194,395	31.97

Note:1. The paid-in capital of the company's common stock is NTD788,000,000 with 78,800,000 shares in issue.
In accordance with Article 26 of the Securities and Exchange Act, the minimum number of shares required to be held by all directors is as follows:
- － Statutory minimum number of shares required to be held by all directors: 6,304,000
- shares
The number of shares held by all directors and supervisors has reached the required percentage.
In accordance with Article 2 of the “Rules and Review Procedures for Director and Supervisor Share Ownership Ratios at Public Companies”, if a public company has elected two or more independent directors, the share ownership figures calculated for all directors other than the independent directors and shall be decreased by 80 percent.

AI assistant

Chang Type — AGM Information 2024

51863_rns_2024-06-26_75ae8d1c-547a-44ac-9b45-61b62c02684b.pdf

CHANG TYPE INDUSTRIAL CO., LTD.

Handbook for the 2024 Annual

Shareholders’ Meeting

Table of Contents

CHANG TYPE INDUSTRIAL CO., LTD.

CHANG TYPE INDUSTRIAL CO., LTD.

Meeting Agenda for the 2024 Annual Shareholders’ Meeting

Report Items

II. 2023 Audit Committee’s Review Report

VI. Report on the Distribution of Cash Dividends from Earnings in 2023

Proposed Resolutions

CHANG TYPE INDUSTRIAL CO., LTD. 2023 Earnings Distribution Statement

Matters for Discussions

Extempore Motions

Adjournment

CHANG TYPE INDUSTRIAL CO., LTD.

2023 Business Report

(II) Analysis of Receipts, Expenditures and Profitability

1. Analysis of Receipts and Expenditures

2. Profitability

(III) Research and Development Condition

II. Business Plan Summary for 2024

1. Business Policy

Attachment 2

CHANG TYPE INDUSTRIAL CO., LTD. 2023 Audit Committee's Audit Report

Attachment 3

Opinion

Basis for Opinion

Key Audit Matters

Inventory valuation

Provision for warranties

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

Auditor’s Responsibilities for the Audit of the Parent Company Only Financial Statements

Notice to Readers

Independent Auditor’s Report

Opinion

Basis for Opinion

Key Audit Matters

Inventory valuation

Provision for warranties

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

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

Other

Notice to Readers

Attachment 4

CHANG TYPE INDUSTRIAL CO., LTD.

Cross-Reference Table on Articles of the “Corporate Social Responsibility Best Practice Principles”

CHANG TYPE INDUSTRIAL CO., LTD.

Cross-Reference Table on Articles of the “Rules of Procedure for Shareholders Meetings”

Attachment 6

CHANG TYPE INDUSTRIAL CO., LTD.

Cross-Reference Table on Articles of the “Articles of Incorporation”

Articles of Incorporation of CHANG TYPE INDUSTRIAL CO., LTD. Chapter 1 General Provisions

Chapter 3 Shareholders' Meeting

Chapter 4 Directors and Supervisors

Chapter 5 Managers and Employees

Chapter 6 Accounting

Chapter 7 Supplementary Provisions

CHANG TYPE INDUSTRIAL CO., LTD.

Chairman: CHANG, CHIN-CHIN

CHANG TYPE INDUSTRIAL CO., LTD. Shareholding of directors

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Chang Type AGM Information 2024