Stock Code ： 1905

Chung Hwa Pulp Corporation 2018 ANNUAL GENERAL Shareholders' Meeting

Meeting Handbook

Date: June 26, 2018

Venue: 3F, No.24, Sec. 1, Hangjhou S. Rd., Taipei City, GIS Convention Center This is a translation of the meeting handbook of the 2018 Annual General Shareholders’ Meeting of Chung Hwa Pulp Corporation. This translation is intended for reference only and nothing else, the company here by disclaims any and all liabilities whatsoever for the translation. The chinese text of the handbook shall govern any and matters related to the interpretation of the subject matter stated herein.

Contents

I. Meeting Agenda………………………………………………………………………………………1 II. Items to Report……………………………………………………………………………………….2 1. Report on business status for the year 2017…………………………………………………...2 2. Audit committee's review report on final accounting books and statements for the year 2017...2 3. Report on distribution of employees' compensation, and directors’ compensation for the year 2017………………………………………………………………………………………....2 4. Report on amendment to the Rules of Procedure for Board of Director Meetings…………….2 III. Items to Ratify………………………………………………………………………………………4 1. Proposal of final accounting books and statements for the year 2017…………………………4 2. Proposal of profit distribution for the year 2017………………………………………………4 IV. Discussion Items…………………………………………………………………………………….5 1. Proposal of amendment to the Articles of Incorporation.……………………………………...5 2. Proposal of amendment to the Company’s Procedures of Acquisition or Disposal of Assets....5 3. Proposal of amendment to the Company’s Procedures of Engaging in Derivatives Trading…..5 4. Proposal of amendment to the Company’s Operational Procedures for Lending Funds to Others………………………………………………………………………………………..5 V. Extraordinary Motions……………………………………………………………………………….6 VI. Appendices………………………………………………………………………………………….7 1. 2017 Business Report………………………………………………………………………..7 2. Consolidated Financial Statements and Independent Auditors’ Report………………………..9 3. Parent Company Only Financial Statements and Independent Auditors’ Report……………...18 4. Audit Committee’s Review Report…………………………………………………………...19 5. Earnings Distribution Statements…...………………………………………………………...20 6. Comparison table of Amended Provisions for Rules of Board Meetings……………………..21 7. Comparison table of Amended Provisions of the Articles of Incorporation………………….28 8. Comparison table of Amended Provisions of the Procedures for Acquisition or Disposal of Assets……………………………………………………………………………………….34 9. Comparison table of Amended Provisions of the Procedures for Engaging in Derivatives Trading……………………………………………………………………………………...42 10. Comparison table of Amended Provisions of the Operational Procedures for Lending Funds to Others………………………………………………………………………………………49 11. Rules of Procedure for the Shareholders Meetings………………………………………54 12. Articles of Incorporation…………………………………………………………………56 13. Name and Current Shareholding of Directors……………………………………………...61 (Complete financial reports available at: http://mops.twse.com.tw)

Chung Hwa Pulp Corporation Agenda for the 2018 Annual General Shareholders’ Meeting

I. Meeting Agenda

Date and Time: June 26, 2018 (Tuesday), 9 A.M. (Taipei Time)

Venue: 3F, No.24, Sec. 1, Hangzhou S. Rd., Taipei City.

GIS MOTC Convention Center

Meeting Order:

Call to order
Chairperson takes the chair
Chairperson’s remarks
Items to Report
Items to Ratify
Discussion Items
Extraordinary Motions
Adjournment

II. Items to Report

Report on the business status for the year 2017. Please review.

Explanation:

(1) The Company's consolidated operating revenue was NTD22,708,148 thousand for the year 2017. Gross profit was NTD2,311,773 thousand and net operating profit was NTD792, 055 thousand after deducting operating costs and operating expenses. Adding net income of NTD92,833 thousand for nonoperating items, the net income before tax was NTD884,888,000; after deducting income tax expense of NTD158,673 thousand, net income after tax was NTD726,215 thousand, in which net income of NTD618,582 thousand was the Company's owners' interests, and net income of NTD107,633 thousand was non-controlling interests. In addition to consolidated net income, other comprehensive loss NTD301,708thousand, resulting in a current comprehensive income gain of NTD424,507thousand, in which a net income of NTD363,366 thousand was the Company's owners' interests, and a net income of NTD61,141 thousand as non-controlling interests. Basic earnings per share was NTD0. 56.
(2) Please refer to Appendices 1 to 3 (p.7 to p. 18 ) for the business report and final accounting books and statements.
Audit Committee's review report on final accounting books and statements for the year 2017. Please review.

Proposed by the Audit Committee

Explanation:

(1) Please refer to Appendices 1 to 5 (p.7 to p.20 ) for the CPA-audited and attested consolidated and parent company only financial statements for the year 2017, together with the business report, profit distribution table, and Audit Committee's review report thereto.
(2) Invite the convener of Audit Committee to read out the review report.
Report on distribution of employees' compensation, and directors’ compensation for the year 2017. Please review.

Proposed by the Board

Explanation:

The Company allocated NTD8,000,000 for employees compensation and NTD7,000,000 for directors’ compensation for the year 2017. This matter was reviewed and approved in the fourth meeting of the third Remuneration Committee dated March 16, 2018, and further discussed, resolved, and put on record in the eighth meeting of the 17th Board dated March 22, 2018, and is submitted to this shareholder meeting pursuant to the Company's Articles of Incorporation.

Report on amendment to the “the Rules of Procedure for Board of Director Meetings ”. Please review.

Proposed by the Board

Explanation:

(1) According to the amended Regulations Governing Procedure for Board of Directors Meetings of Public Companies, the amendment to the Rules of Procedure for Meetings of Board of Directors was discussed and resolved in the sixth meeting of the 17th Board on

November 13, 2017.

(2) Please refer to Appendix 6 (p.21 to p.27 ) for the comparison chart and revised full text of the Rules of Procedure for Meetings of Board of Directors.

III. Items to Ratify

Proposal of final accounting books and statements for the year 2017. Please ratify.

Explanation:

Please refer to Appendices 1 to 4 ( p.7 to p.19 ) for the CPA-audited and attested financial statements for the year 2017, together with the business report and Audit Committee's review report thereto.

Resolution:

Proposal of profit distribution for the year 2017. Please ratify.

Proposed by the Board

Explanation:

(1) The Earning Distribution Statements for year 2017 is proposed in compliance with Articles 31, 31-1, and 32 of the Company's Articles of Incorporation. Wherein the net income after tax for the year 2017 of NTD618,581,996, plus undistributed earnings of NTD2,493,930,207 from previous years, less retained earnings of NTD4,671,492 from investment adjustments accounted for using the equity method, less NTD15,821,460 remeasurements of defined benefit plans in retained earnings, and setting aside NTD61,858,200 for legal reserve according the laws, the distributables amount to NTD3,030,161,051, of which NTD0.50 per share or NTD551,417,658 will be paid out as cash dividends of common stock, and the remainder, NTD2,478,743,393, will be retained as undistributed earnings at the end of the period.
(2) The current cash dividends are calculated pursuant to distribution ratio and rounded down to the whole dollar amounts; the fractional amounts are aggregated and recorded as other income of the Company.
(3) In case the Company's later buybacks affect number of outstanding shares hence distribution ratio is required to revise, the Board shall modify the current cash dividends as authorized.
(4) July 25 is the proposed distribution record date for cash dividends of common stock as adopted in the shareholder meeting.
(5) Please refer to Appendix 5 (p.20) for the Earning Distribution Statements for the year 2017.

Resolution:

IV. Discussion Items

Proposal of amendment to the Company’s "Articles of Incorporation". Please proceed to discuss.
Proposed by the Board

Explanation:

(1) A partial revision to the Company’s Articles of Incorporation is proposed in response to the Company's policy, which adds the Company's scope of business.
(2) Please refer to Appendix 7 (p.28 to p.33) for the comparison chart and revised full text of the Articles of Incorporation.

Resolution:

Proposal of amendment to the Company’s "Procedures for Acquisition and Disposal of Assets". Please proceed to discuss.

Proposed by the Board

Explanation:

(1) A partial revision to the Company's Procedures for Acquisition and Disposal of Assets is proposed in response to the Regulations Governing the Acquisition and Disposal of Assets by Public Companies promulgated by the Financial Supervisory Commission and the Company's current practice.
(2) Please refer to Appendix 8 (p.34 to p.41 ) for the comparison chart and revised full text of the Procedures for Acquisition and Disposal of Assets.
Resolution:
Proposal of amendment to the Company’s "Procedures for Engaging in Derivatives Trading". Please proceed to discuss.

Proposed by the Board

Explanation:

(1) A partial revision to the Company's Procedures for Engaging in Derivatives Trading is proposed in response to the Regulations Governing the Acquisition and Disposal of Assets by Public Companies promulgated by the Financial Supervisory Commission and the Company's current practice.
(2) Please refer to Appendix 9 (p.42 to p.48 ) for the comparison chart and revised full text of the Procedures for Engaging in Derivatives Trading.
Resolution:
Proposal of amendment to the Company’s "Operational Procedures for Lending Funds to Others". Please proceed to discuss.
- Proposed by the Board

Explanation:

(1) A partial revision to the Company’s Operational Procedures for Lending Funds to Others is proposed in response to the Regulations Governing Lending of Funds and Making of Endorsements/Guarantees by Public Companies promulgated by the Financial Supervisory Commission and the Company's current practice.
(2) Please refer to Appendix 10 (p.49 to p.53 ) for the comparison chart and revised full text of the Operational Procedures for Lending Funds to Others.
Resolution:

V. Extraordinary Motions

VI. Appendix Appendix 1

2017 Business Report

According to the latest forecast published by Chung-Hua Institution for Economic Research (CIER), Taiwan delivered a year-round rate of 2.53% for economic growth in 2017, an increase of 1.12 percentage points from 1.41% in 2016, while the annual economic growth of 2018 is forecasted to be 2.27%. In 2017, global economy rebounded. Performance in most countries was better than expected, promoting the growth of global commodity trade and affecting Taiwan’s performance as well. Net foreign demand in Taiwan contributed 1.36 percentage points in 2017, exceeding domestic demand of 1.17 percentage points. As a result, the domestic economy was highly affected by changes in global economy and trade, including the government of the U.S. led by Donald Trump and strict actions taken by China for environmental protection. Looking into 2018, the industry will continue to be variable due to significant fluctuations in prices of international crude oil, coal, and raw materials, especially increasing prices of wood and pulp, in addition to the Fed's rate increase period and the policies of major economies.

Since 2017, the global price of pulp has increased. The price of NBKP increased 55% from USD580/ton to USD900/ton; the price of LBKP also increased 60% from USD470/ton to USD760/ton. Such increase caused the production costs of the global paper industry continued to increase. As the environmental awareness rose internationally, many governments have responded. China has taken various actions, such as limited production, stricter emission standards, and import of waste paper. The Chinese paper industry is standing in the way of integration and reform, which leads to industry concentration and a tendency toward monopoly.

CHP's paper production in 2017 amounted to 444,889 metric tons, increasing 3,065 metric tons from 441,824 metric tons in 2016; total sales amounted to 502,404 metric tons, including domestic sales of 265,692 and export of 236,712 metric tons. For paperboard, year-round production in 2017 amounted to 117,204 metric tons, decreasing by 5,822 metric tons compared to 123,026 metric tons in 2016. Faced with pressure from imported paper, our company not only enhanced our product quality but also stabilized the source, price, and supply of raw materials. We continued to expand the application of our product and increase local services in order to lift our market share and competitiveness. The global price of pulp kept increasing. The price of pulp rose by 60%, but price of paper only rose slowly in 2017. We hope to reduce the pressure on the growth of pulp prices for the domestic cultural paper industry. Compared to the increase in cost, there is still a considerable gap in paper prices.

As the leader in the pulp and paper industry, CHP spares no effort in environmental protection and corporate social responsibility in addition to the development of Taiwan's cultural industry. With the core strategy of R[3] management (Recycle/Reclaim/Regenerate), CHP has strived to achieve the consistent production, from forests, pulp to paper products. In 2017, CHP participated in Taiwan Corporate Sustainability Awards organized by Taiwan Institute for Sustainable Energy for the first time and won Top 50 Corporate Sustainability Award - Traditional Manufacturing and a bronze award in CSR - Traditional Manufacturing. Taking into account both profitability and growth, CHP incorporated the idea of sustainable development into the business operation,

starting from source procurement. CHP has won green procurement award for consecutive years. The pulp and paper industry has a high affinity with nature, where resources can be recycled endlessly. Facing the increasing awareness of environmental protection and sustainable development worldwide, CHP responds actively and creates new niches based on green perspectives.

Facing the change of environment and times, CHP strives to transform from reading to life by viewing sustainable developments as a common factor in business operation. Aiming to reaching the environmental and social balance, CHP upholds the people-oriented core values covering corporate governance, ecology, circular economy, and social responsibility. Forest-pulp-paper is a new bio-economic model. The advantage lies in the high affinity with nature, where resources can be recycled endlessly and reflect the value of sustainability.

Appendix 2

CHUNG HWA PULP CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2017 AND 2016
(In Thousands of New Taiwan Dollars)

`ASSETS`	`December 31 , 2016`	`December 31 , 2016`	`December 31 , 2015`	`December 31 , 2015`			`LIABILITIES AND EQUITY`	`December 31 , 2016`	`December 31 , 2016`	`December 31 , 2015`	`December 31 , 2015`
	`AMOUNT`	`％`	`AMOUNT`	`％`	`AMOUNT`	`％`		`AMOUNT`	`％`	`AMOUNT`	`％`	`AMOUNT`	`％`
`CURRENT ASSETS`	11,884,530	40	13,080,307	43	(1,195,777)	(9)	`CURRENT LIABILITIES`	7,416,126	25	7,770,394	25	(354,268)	(5)
Cash and cash equivalents	496,230	2	345,315	1	150,915	44	Short-term borrowings & billspayable	3,837,359	13	4,394,341	14	(556,982)	(13)
Financial assets at fair value throughprofit or loss	16,958	-	-	-	16,958	1	Current portion of long-term borrowings	108,000	-	-	-	108,000	1
Available-for-sale financial assets	651,792	2	640,580	2	11,212	2	Notes and accounts payable	2,754,854	9	2,832,630	9	(77,776)	(3)
Derivative financial assets for hedging- current	10,100	-	22,400	-	(12,300)	(55)	Other current liabilities	715,913	3	543,423	2	172,490	32
Notes and accounts receivable	3,939,962	13	4,064,150	14	(124,188)	(3)	`NON-CURRENT LIABILITIES`	4,177,440	14	3,553,031	12	624,409	-
Inventories	2,989,561	10	3,778,977	12	(789,416)	(21)	Long-term borrowings	1,841,765	6	1,240,000	4	601,765	49
Biological assets	3,275,503	11	3,622,184	12	(346,681)	(10)	Deferred tax liabilities	1,991,618	7	1,989,854	7	1,764	-
Other current assets	504,424	2	606,701	2	(102,277)	(17)	Net defined benefit liabilities	286,549	1	291,933	1	(5,384)	(2)
							Other non-current liabilities	57,508	-	31,244	-	26,264	84
`NON-CURRENT ASSETS`	17,768,363	60	17,345,832	57	422,531	2	`Total liabilities`	11,593,566	39	11,323,425	37	270,141	2
Available-for-sale financial assets	416,578	1	451,387	1	(34,809)	(8)	EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY
Debt investments with no active market - non-current	170,000	1	170,000	1	-	-	Share capital	11,028,353	37	11,028,353	36	-	-
Financial assets measured at cost	261,902	1	261,952	1	(50)	-	Capital surplus	34,403	-	27,286	-	7,117	26
Investments accounted for using the equitymethod	955,180	3	978,187	3	(23,007)	(2)	Retained earnings	4,186,649	14	4,507,038	15	(320,389)	(7)
Property, plant and equipment	14,560,196	49	13,741,408	45	818,788	6	Other equity	464,552	2	946,780	3	(482,228)	(51)
Investment properties	258,008	1	258,398	1	(390)	-	`Total equity attributable to` `owners of the Company`	15,713,957	53	16,509,457	54	(795,500)	(5)
Deferred tax assets	250,253	1	216,711	1	33,542	15	`NON-CONTROLLING INTERESTS`	2,345,370	8	2,593,257	9	(247,887)	(10)
Other non-current assets	896,246	3	1,267,789	4	(371,543)	(29)	`Total equity`	18,059,327	61	19,102,714	63	(1,043,387)	(5)
`Total`	29,652,893	100	30,426,139	100	(773,246)	(3)	`Total`	29,652,893	100	30,426,139	100	(773,246)	(3)

`CHUNG HWA PULP CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME`

FOR THE YEARS ENDED DECEMBER 31, 2017 AND 2016

(In Thousands of New Taiwan Dollars, Except Earnings Per Share)

`Item`	`2016`	`2016`	`2016`	`2015`	`2015`	`2015`	`comparision`	`comparision`
	`Subtotal`	`Total`	`％`	`Subtotal`	`Total`	`％`	`Amount`	`％`
`OPERATING REVENUE:`		22,001,536	100		20,990,843	100	1,010,693	5
Sales	21,941,245		100	20,914,775		100	1,026,470	5
Other operatingrevenue	60,291		-	76,068		-	(15,777)	(21)
`OPERATING COSTS:`		20,112,182	92		18,718,924	89	1,393,258	7
Cost ofgoods sold	20,074,078		92	18,675,122		89	1,398,956	7
Other operatingcost	38,104		-	43,802		-	(5,698)	(13)
`GROSS PROFIT`		1,889,354	8		2,271,919	11	(382,565)	(17)
`(LOSS) GAIN FROM CHANGES IN FAIR VALUE` `LESS COSTS TO SELL OF BIOLOGICAL` `ASSETS`		(13,295)	-		(740)	-	(12,555)	1,697
`OPERATING EXPENSES`		1,490,951	7		1,491,671	7	(720)	0
`PROFIT FROM OPERATIONS`		385,108	1		779,508	4	(394,400)	(51)
`NON-OPERATING INCOME AND EXPENSES`		(51,988)	-		80,947	-	(132,935)	164
Net finance costs	(40,430)		-	(34,315)		-	(6,115)	(18)
Other income or loss	(11,558)		-	115,262		-	(126,820)	(110)
`PROFIT BEFORE INCOME TAX`		333,120	1		860,455	4	(527,335)	(61)
`INCOME TAX(BENEFIT) EXPENSE`		16,598	-		(14,677)	-	31,275	213
`NET PROFIT FOR THE YEAR`		349,718	1		845,778	4	(496,060)	(59)
`OTHER COMPREHENSIVE LOSS`		(742,077)	(3)		(379,152)	(2)	(362,925)	96
`TOTAL COMPREHENSIVE INCOME FOR THE` `YEAR`		(392,359)	(2)		466,626	2	(858,985)	(184)
`NET PROFIT ATTRIBUTABLE TO:`
Owners of the Company		391,114	2		779,717	4	(388,603)	(50)
Non-controllinginterests		(41,396)	-		66,061	-	(107,457)	(163)
		349,718	2		845,778	4	(496,060)	(59)
`TOTAL COMPREHENSIVE INCOME` `ATTRIBUTABLE TO:`
Owners of the Company		(144,472)	(1)		478,369	2	(622,841)	(130)
Non-controllinginterests		(247,887)	(1)		(11,743)	-	(236,144)	2,011
		(392,359)	(2)		466,626	2	(858,985)	(184)
`EARNINGS PER SHARE`		0.35			0.66

`CHUNG HWA PULP CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY`

THE YEARS ENDED DECEMBER 31, 2017 AND 2016
(In Thousands of New Taiwan Dollars)

	`Equity Attributable to Owners of the Company`	`Equity Attributable to Owners of the Company`	`Equity Attributable to Owners of the Company`	`Equity Attributable to Owners of the Company`	`Equity Attributable to Owners of the Company`	`Equity Attributable to Owners of the Company`	`Equity Attributable to Owners of the Company`	`Equity Attributable to Owners of the Company`	`Equity Attributable to Owners of the Company`	`Equity Attributable to Owners of the Company`	`Equity Attributable to Owners of the Company`	`Equity Attributable to Owners of the Company`	`Non-` `controlling` `Interests`	`Total` `Equity`
	`Share Capital`		`Capital` `Surplus`	`Retained Earnings`				`Other Equity`			`Treasury` `Stock`	`Total`
	`Shares` `(Thousands)`	`Amount`		`Legal Reserve`	`Special` `Reserve`	`Unappropriated` `Earnings`	`Total`	`Exchange` `Differences` `on` `Translating` `Foreign` `Operations`	`Unrealized` `Gain (Loss) on` `Available-for-` `sale Financial` `Assets`	`Cash Flow` `Hedges`
`BALANCE AT JANUARY 1, 2015`	1,222,835	12,228,353	21,030	-	1,186,894	2,637,589	3,824,483	541,542	734,970	(3,097)	-	17,347,281	2,605,000	19,952,281
`Appropriation of the 2014 earnings`
`Legal reserve`	-	-	-	2,750	-	(2,750)	-	-	-	-	-	-	-	-
`Cash dividends distributed by the Company`	-	-	-	-	-	(122,283)	(122,283)	-	-	-	-	(122,283)	-	(122,283)
`Adjustments for the changes in equity of` `associates`	-	-	6,256	-	-	(166)	(166)	-	-	-	-	6,090	-	6,090
`Net profit for the year ended December 31,` `2015`	-	-	-	-	-	779,717	779,717	-	-	-	-	779,717	66,061	845,778
`Other comprehensive income for the year` `ended December 31, 2015, net of income` `tax`	-	-	-	-	-	25,287	25,287	(43,912)	(288,858)	6,135	-	(301,348)	(77,804)	(379,152)
`Total comprehensive income for the year` `ended December 31, 2015`	-	-	-	-	-	805,004	805,004	(43,912)	(288,858)	6,135	-	478,369	(11,743)	466,626
`Capital reduction by cash`	(120,000)	(1,200,000)	-	-	-	-	-	-	-	-	-	(1,200,000)	-	(1,200,000)
`BALANCE AT DECEMBER 31,2015`	1,102,835	11,028,353	27,286	2,750	1,186,894	3,317,394	4,507,038	497,630	446,112	3,038	-	16,509,457	2,593,257	19,102,714
`Appropriation of the 2015 earnings`
`Legal reserve`	-	-	-	77,971	-	(77,971)	-	-	-	-	-	-	-	-
`Cash dividends distributed by the Company`	-	-	-	-	-	(661,701)	(661,701)	-	-	-	-	(661,701)	-	(661,701)
`Adjustments for the changes in equity of` `associates`	-	-	7,117	-	-	3,556	3,556	-	-	-	-	10,673	-	10,673
`Net profit for the year ended December 31,` `2016`	-	-	-	-	-	391,114	391,114	-	-	-	-	391,114	(41,396)	349,718
`Other comprehensive income for the year` `ended December 31, 2016, net of income` `tax`	-	-	-	-	-	(53,358)	(53,358)	(366,081)	(101,759)	(14,388)	-	(535,586)	(206,491)	(742,077)
`Total comprehensive income for the year` `ended December 31, 2016`	-	-	-	-	-	337,756	337,756	(366,081)	(101,759)	(14,388)	-	(144,472)	(247,887)	(392,359)
`BALANCE AT DECEMBER 31,2016`	1,102,835	11,028,353	34,403	80,721	1,186,894	2,919,034	4,186,649	131,549	344,353	(11,350)	-	15,713,957	2,345,370	18,059,327

CHUNG HWA PULP CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS THE YEARS ENDED DECEMBER 31, 2017 AND 2016 (In Thousands of New Taiwan Dollars)

CONSOLIDATED STATEMENTS OF CASH FLOWS THE YEARS ENDED DECEMBER 31, 2017 AND 2016 (In Thousands of New Taiwan Dollars)
	`2016`	`2015`
`Share of profit of associates` `Dividend income` `Impairment loss recognized on accounts receivable` `Write-down (reversal of write-down) of inventories` `Interest income` `Finance costs` `Loss (gain) on disposal of property, plant and equipment` `(Loss) gain on changes in fair value less cost to sell of` `biological assets` `Notes and accounts receivable` Changes in operating assets and liabilities `Net gain on disposal of investments` `Net unrealized gain on foreign currency exchange` `Other payables` `Notes and accounts receivable from related parties` `Notes and accounts payable to related parties` `Biological assets` `CASH FLOWS FROM OPERATING ACTIVITIES` `Net loss on fair value change of financial instruments` `at fair value through profit or loss` `Income before income tax` `Depreciation and amortization expenses` `Adjustments for:` `Inventories` `Other current liabilities` `Other current assets` `Notes payable and accounts payable` Cash generated from operations `Net cashgenerated from operating activities` `Net defined benefit liabilities` Income tax paid Interest received Interest paid	333,120 964,535 2,860 13,692 74,222 (33,792) (30,393) (44,714) 1,604 (85) (5,038) (17,617) 13,295 (108,568) (194,941) 763,309 44,985 82,095 82,950 71,457 (52,190) 197,623 (69,476)	860,455 924,615 1,096 9,102 65,163 (30,848) (40,379) (19,763) 70 (439) 3,978 (7,243) 740 182,391 (160,698) 250,538 (706,479) (197,104) 119,455 56,825 139,822 172,282 (16,556)
	2,088,933 35,008 (76,257) (1,501)	1,607,023 30,976 (61,644) (16,594)
	2,046,183	1,559,761
	`(Continued)`

`Proceeds of short-term bills payable` Net cash used in investing activities `Increase (decrease) in short-term borrowings` `Purchase of financial instruments at fair value through profit` `or loss` `CASH FLOWS FROM INVESTING ACTIVITIES` Dividend received `Proceeds of the sale of available-for-sale financial assets` `Proceeds of capital reduction on financial assets measured at` `cost` `Proceeds of capital reduction on financial assets measured` `at cost` `Purchase of financial assets measured at cost` `Payments for property, plant and equipment` `Proceeds of the sale of financial instruments at fair value` `through profit or loss` `Proceeds of the sale of debt investments with no active market` `Purchase of debt investments with no active market` `Decrease (increase) in other receivables of related parties` `Cash dividends paid` `Capital reduction by cash` `Proceeds of long-term borrowings` `Increase in other non-current liabilities` `Increase in other non-current liabilities` `CASH FLOWS FROM FINANCING ACTIVITIES` `Proceeds of the disposal of property, plant and equipment` `Purchase of available-for-sale financial assets` `Increase in prepayments for equipment` `Decrease (increase) in other non-current assets` Net cash generated from financing activities `CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR` `EFFECTS OF EXCHANGE RATE CHANGES ON THE BALANCE` `OF CASH HELD IN FOREIGN CURRENCIES` `NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS` `CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR`	(1,915,779) 1,891,516 (48,023) - (20,100) 32,400 50 (16,112) 2,884 (1,971,325) - 295,203 (10,761) 306,060 53,261	(7,173,432) 7,162,375 - 4,646 (446,968) 476,285 13,950 - 4,851 (2,082,160) 2,156 852,655 179,770 (670,382) 66,805
	(1,400,726)	(1,609,449)
	(558,667) 1,685 3,259,765 (2,550,000) 29,608 - (660,279)	215,049 797,950 2,080,000 (1,760,000) 9,847 (1,200,000) (121,780)
	(477,888)	21,066
	(16,654)	(2,811)
	150,915 345,315	(31,433) 376,748
	496,230	345,315

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and the Shareholders Chung Hwa Pulp Corporation

Opinion

We have audited the accompanying consolidated financial statements of Chung Hwa Pulp Corporation and its subsidiaries (the Group) which comprise the consolidated balance sheets as of December 31, 2017 and 2016, and the consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and the notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2017 and 2016, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC) and SIC Interpretations (SIC) endorsed and issued into effect by the Financial Supervisory Commission (FSC) of the Republic of China.

Basis for Opinion

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements for the year ended December 31, 2017. 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.

The descriptions of the key audit matters of the consolidated financial statements for the year ended December 31, 2017 are as follows:

Volume Estimation in Biological Assets

The Group’s biological assets are eucalyptus trees planted in areas located in Guangdong Province, Zhaoqing City. The eucalyptus trees are mainly grown for the manufacture of paper products. The fair value of biological assets is based on the volume of eucalyptus trees and market price per ton. The volume of eucalyptus trees provided in the annual forest growth investigation report is estmiated based on the reckoning of samples of measurement areas and growth differences, weather conditions, and insect infestations. Since measuring the volume of biological assets involves significant estimation uncertainty, it has been identified as a key audit matter.

Our key audit procedures performed in respect of the above area included the following:

We obtained a copy of annual forest growth investigation report and verified the data against supporting documents.
We validated the consistency of the measurement adopted for estimating the volume of the biological assets and confirmed the authorized management’ s approval of the measurement.
We attended the annual inventory counts of the biological assets and performed sample counts.

Provision for Receivables

The notes and accounts receivables of the Group are material in amount. In consideration of the business volume and client condition, the recoverability of receivables is subject to management’s judgement. Therefore, the provision for receivables has been identified as a key audit matter.

Our key audit procedures performed in respect of the above area included the following:

We assessed the reasonableness of the assumptions used by the management in estimating provision for receivables. We evaluated the clients’ financial position and historical payment records, particularly on those with significant outstanding receivables and longer days of turnover.
We inquired if there is any client with significant amount of outstanding receivables that are known as having financial difficulties, and whether the management has adopted appropriate response to secure its receivables.
We assessed the collections of past due receivables and the adequacy of provisoin for bad debts.

Other Matter

We have also audited the parent company only financial statements of Chung Hwa Pulp Corporation as of and for the years ended December 31, 2017 and 2016, on which we have issued unqualified report.

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

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

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

Those charged with governance (including the audit committee) are responsible for overseeing the Group’s financial reporting process.

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

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

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

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

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant

deficiencies in internal control that we identify during our audit.

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements for the year ended December 31, 2017, and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partners on the audit resulting in this independent auditors’ report are Shu-Wan Lin and Shiow-Ming Shue.

Deloitte & Touche Taipei, Taiwan Republic of China

March 22, 2018

Notice to Readers

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

For the convenience of readers, the independent auditors’ report and the accompanying consolidated financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, the Chinese-language independent auditors’ report and consolidated financial statements shall prevail. Also, as state in Note 32 to the consolidated financial statements, the additional footnote disclosures that are not required under generally accepted accounting principles were not translated into English.

Appendix 3

Chung Hwa Pulp Corp. Stand-alone Balance Sheets Chung Hwa Pulp Corp. Stand-alone Statement of Comprehensive Income Chung Hwa Pulp Corp. Stand-alone Statements of Changes In Stockholders' Equity Chung Hwa Pulp Corp. Stand-alone Statements of Cash Flows

The Stand-alone financial reports are provided on the MOPS website, please visit http://mops.twse.com.tw/mops/web/t163sb03 for the complete Stand-alone financial reports.

Appendix 4

Audit Committee’s Review Report

The Company’s 2017 business report, financial statements and proposal of earnings distribution have been reviewed and determined to be correct and accurate by the Audit Committee, so according to Article 14-4 of the Securities and Exchange Act and Article 219 of the Company Act, we hereby submit this report to the 2018 Annual General Meeting of shareholders of the Company.

Chung Hwa Pulp Corporation

Convener of the audit committee: Shih Kuan Chen

March 22, 2018

Appendix 5

Chung Hwa Pulp Corporation

2017 EARNINGS DISTRIBUTION STATEMENTS

UNIT: NTD

	UNIT: NTD
Item	Amount
I. Distributable retained earnings
A. Distributable retained earnings at beginning of the fiscal year	2,493,930,207
B. Net Profit for the year ended Dec 31st, 2017	618,581,996
C. Adjustment on retained earnings of changes in equities of investments	(4,671,492)
D. Remeasurement of defined benefit plans	(15,821,460)
Total	3,092,019,251

II. Items to be allocated
1. Legal Reserve	61,858,200
2. Cash dividends (NTD 0.50per share)	551,417,658
3. Unappropriated retained earnings	2,478,743,393
Total	3,092,019,251

Appendix 6

Chung Hwa Pulp Corporation

Comparison Table of Amended Provisions for the Rules of Board Meetings

Sequence number of the article		Amended article	Current article	Description
Article 12		The company shall submit the following items for discussion by the Board: I. Corporate business plan. II. Annual financial reports. III. Adoption or amendment of an internal control system pursuant to Article 14-1 of the Securities and Exchange Act (hereinafter the "Act"), and assessment of the effectiveness of the internal control system. IV. Adoption or amendment, pursuant to Article 36-1 of the Act, of handling procedures for financial or operational actions of material significance, such as acquisition or disposal of assets, derivatives trading, extension of monetary loans to others, and endorsements or guarantees for others. V. Offering, issuance, or private placement of any equity-type securities. VI. Appointments and dismissal of finance, accounting and internal audit managers VII A donation to a related party or a major donation to a non-related party, provided that a public-interest donation of disaster relief for a major natural disaster may be submitted to the following board of directors meeting for retroactive recognition. VIII. Any matter required by Article 14-3 of the Act or anyother law,	The company shall submit the following items for discussion by the Board: I. Corporate business plan. II. Annual financial reports. III. Adoption or amendment of an internal control system pursuant to Article 14-1 of the Securities and Exchange Act (hereinafter the "Act"). IV. Adoption or amendment, pursuant to Article 36-1 of the Act, of handling procedures for financial or operational actions of material significance, such as acquisition or disposal of assets, derivatives trading, extension of monetary loans to others, and endorsements or guarantees for others. V. Offering, issuance, or private placement of any equity-type securities. VI. Appointments and dismissal of finance, accounting and internal audit managers VII. A donation to a related party or a major donation to a non-related party, provided that a public-interest donation of disaster relief for a major natural disaster may be submitted to the following board of directors meeting for retroactive recognition. VIII. Any matter required by Article 14-3 of the Act or anyother law,	1.Considering the assessment of the effectiveness of the internal control system within the authority of the audit committee, as prescribed in the Securities and Exchange Act, is also a significant matter that shall be proposed to the Board for discussion. It is added to Subparagraph 3, Paragraph 1. 2.Expressions in Paragraphs 2 and 3 are slightly adjusted. 3.The paragraph is amended to clarify the authority of independent directors and further strengthen their participation in the Board.

regulation, or bylaw to be approved by resolution at a shareholders' meeting or Board meeting, or any such significant matter as may be prescribed by the competent authority.

The term "related party" in Subparagraph 7 of the preceding paragraph means a related party as defined in the Regulations Governing the Preparation of Financial Reports by Securities Issuers. The term "major donation to a non-related party" means any individual donation, or cumulative donations within a 1-year period to a single recipient, at an amount of NT$100 million or more, or at an amount equal to or greater than 1 percent of net operating revenue or 5 percent of paid-in capital as stated in the CPA-attested financial report for the most recent year.

The term "within a 1-year period" in the preceding paragraph means a period of 1 year calculated retroactively from the date on which the current board of director meeting is convened. Proposals already submitted to and passed by a resolution of the Board are exempted from inclusion in the calculation.

At least one independent director shall attend in person any meeting of the Board. With respect to a matter prescribed in Paragraph 1 that must be approved by resolution at a Board meeting, all independent directors shall attend the meeting in person or appoint another independent director to attend the meeting as a proxy If independent directors have opposing or reserved

regulation, or bylaw to be approved by resolution at a shareholders' meeting or Board meeting, or any such significant matter as may be prescribed by the competent authority.

The term "related party" in subparagraph 7 of the preceding paragraph means a related party as defined in the Regulations Governing the Preparation of Financial Reports by Securities Issuers. The term "major donation to a non-related party" means any individual donation, or cumulative donations within a 1-year period to a single recipient, at an amount of NT$100 million or more, or at an amount equal to or greater than 1 percent of net operating revenue or 5 percent of paid-in capital as stated in the CPA-attested financial report for the most recent year.

The term "within a 1-year period" in the preceding paragraph means a period of 1 year calculated retroactively from the date on which the current Board meeting is convened. Amounts already submitted to and passed by a resolution of the board are exempted from inclusion in the calculation.

Each independent director shall attend in person any meeting concerning a matter that requires a resolution by the Board under Article 14-3 of the Act, or shall appoint another independent director to attend as his or her proxy. If independent directors have opposing or reserved opinions, these opinions shall be recorded in the Board meeting

opinions, these opinions shall be recorded in the Board meeting records; if independent directors cannot personally attend Board meeting to express their opposing or reserved opinion, they shall give a written opinion before the meeting unless they have an appropriate reason and the opinion shall be recorded in the Board meeting records.

records; if independent directors cannot personally attend Board meeting to express their opposing or reserved opinion, they shall give a written opinion before the meeting unless they have an appropriate reason and the opinion shall be recorded in the Board meeting records.

Chung Hwa Pulp Corporation Rules of Board Meetings

Article 1.For the purpose of soundness of Board of Directors governance and function of supervision and management, the Rules of Procedure for Meetings of Board of Directors (hereinafter the "Board") are adopted pursuant to the Regulations Governing Procedure for Board of Directors Meetings of Public Companies.
Article 2.The main agenda items, operational procedures, required content of meeting minutes, public announcements, and other compliance requirements for Board meetings shall be handled in accordance with the these regulations herein.

Article 3.The Board of the Company meets once every quarter.

The reasons for calling a Board meeting shall be notified to each director at least seven days in advance. In emergency circumstances, however, a meeting may be called on shorter notice.
The notice set forth in the preceding paragraph may be effected by means of electronic transmission, after obtaining prior consent from the recipients thereof.
All matters set out in the subparagraphs of Article 12, paragraph 1, shall be specified in the notice of the reasons for calling a board of directors meeting; none of them may be raised by an extraordinary motion except in the case of an emergency or legitimate reason.
Article 4.The Board of the Company shall appoint Finance and Accounting Dept. as the agenda working group. The agenda working group shall prepare agenda items for Board meetings and provide comprehensive pre-meeting materials, to be sent together with the notice of the meeting.
A director of the opinion that the pre-meeting materials provided are insufficiently comprehensive may request the agenda working group to supplement the materials. If a director is of the opinion that materials concerning any proposal are insufficient in content, the deliberation of such proposal may be postponed by a resolution of the Board.
Article 5.When a meeting of the board of directors is held, an attendance book shall be made ready for signature by directors attending the meeting and thereafter made available for future reference.
All board directors shall attend board meetings in person; if attendance in person is not possible, they may, pursuant to the company's articles of incorporation, appoint another director to attend as their proxy. Attendance via tele- or video-conference is deemed as attendance in person.
When a director attends other directors to attend directors meeting by proxy, a letter of authorization shall be presented, and the scope of responsibilities and obligations based on the purpose of the meeting shall be stated.
A proxy under paragraph 2 may accept a proxy from one person only.
Article 6.A Board meeting shall be held at the location and during the business hours of the company, or at a place and time convenient to all directors and suitable for holding such a meeting.
Article 7.Meetings of the Board shall be called and chaired by the chairperson of the Board. However, the first meeting of each newly elected Board shall be called and chaired by the director who received votes representing the largest portion of voting rights at the shareholders' meeting in which the directors were elected; if there are two or more directors so entitled to call the meeting, they shall choose one person by and from among themselves to do so.
When the chairperson of the Board is on leave or for any reason is unable to exercise the powers of the chairperson, the vice chairperson shall do so in place of the chairperson, or, if there is no vice chairperson or the vice chairperson also is on leave or for any reason is unable to act, by a managing director designated by the chairperson, or, if there is no managing director, by a director designated thereby, or, if the chairperson does not make such a designation, by a managing director or director elected by and from among themselves.
Article 8.Upon calling of a Boarding meeting, the administration department (or the agenda working group

appointed by the Board) shall prepare comprehensive pre-meeting materials for directors' reference whenever necessary.

When holding a meeting of the board, the Company may, as necessary for the agenda items of the meeting, notify personnel of relevant departments or subsidiaries to attend the meeting as nonvoting participants. When necessary, the company may also invite certificated public accountants, attorneys, or other professionals to attend as nonvoting participants and to make explanatory statements, provided that they shall leave the meeting when deliberation or voting takes place.
When the time of a meeting has arrived and over one-half all Board directors are present, the meeting chair may announce convening of the meeting; when the time of a meeting has arrived and one-half all Board directors are not present, the meeting chair may announce postponement of the meeting time, provided that only two postponements may be made. If the quorum is still not met after two such delays, the chair shall re-call the meeting following the procedures provided in Article 3, paragraph 2.
The term "all Board directors" as used in the preceding paragraph and in Article 16, paragraph 2, subparagraph 2 shall be calculated as the number of directors then in office.
Article 9.The company shall record on audio or video tape the entire proceedings of a Board meeting, and preserve the recordings for at least five years, in electronic form or otherwise.
If before the end of the preservation period referred to in the preceding paragraph any litigation arises in connection with a resolution of a Board meeting, the relevant audio or video recordings shall continue to be preserved until the litigation is concluded.
Where a Board meeting is held via tele- or video conferencing, the audio and visual documentation of the meeting form a part of the meeting minutes and shall be well preserved during the existence of the company.
Article 10.Agenda items for regular Board meetings shall include at least the following: I. Reports
1. Minutes of the last meeting and action taken.
2. Reporting on important financial and business matters.
3. Reporting on internal audit report.
4. Other important matters to be reported.
II. Discussions
1. Items for continued discussion from the last meeting.
2. Items for discussion at this meeting.
III. Extraordinary Motions
Article 11.A Board meeting shall be conducted in accordance with the order of business on the agenda as specified in the meeting notice. However, the order may be changed with the approval of a majority of directors present at the meeting.
The meeting chair may not declare the meeting closed without the approval of a majority of directors present at the meeting.
If at any time during the proceeding of a Board meeting the directors sitting at the meeting are not over half of the directors present at the meeting, then upon motion by the directors sitting at the meeting, the chair shall declare a suspension of meeting, in which case paragraph 3 of Article 8 shall apply mutatis mutandis.

Article 12.The Company shall submit the following items for discussion by the Board:

I. Corporate business plan.
II. Annual financial reports.
III. Adoption or amendment of an internal control system pursuant to Article 14-1 of the Securities and Exchange Act (hereinafter the "Act"), and assessment of the effectiveness of the internal control system.
IV. Adoption or amendment, pursuant to Article 36-1 of the Act, of handling procedures for financial or operational actions of material significance, such as acquisition or disposal of assets, derivatives trading, extension of monetary loans to others, and endorsements or guarantees for others.
V. Offering, issuance, or private placement of any equity-type securities.
VI. Appointments and dismissal of finance, accounting and internal audit managers.

VII. A donation to a related party or a major donation to a non-related party, provided that a public-interest donation of disaster relief for a major natural disaster may be submitted to the following board of directors meeting for retroactive recognition.
VIII. Any matter required by Article 14-3 of the Act or any other law, regulation, or bylaw to be approved by resolution at a shareholders' meeting or Board meeting, or any such significant matter as may be prescribed by the competent authority.
The term "related party" in Subparagraph 7 of the preceding paragraph means a related party as defined in the Regulations Governing the Preparation of Financial Reports by Securities Issuers. The term "major donation to a non-related party" means any individual donation, or cumulative donations within a 1-year period to a single recipient, at an amount of NT$100 million or more, or at an amount equal to or greater than 1 percent of net operating revenue or 5 percent of paid-in capital as stated in the CPA-attested financial report for the most recent year.
The term "within a 1-year period" in the preceding paragraph means a period of 1 year calculated retroactively from the date on which the current board of director meeting is convened. Amounts already submitted to and passed by a resolution of the Board are exempted from inclusion in the calculation.
At least one independent director shall attend in person any meeting of the Board. With respect to a matter prescribed in Paragraph 1 that must be approved by resolution at a Board meeting, all independent directors shall attend the meeting in person or appoint another independent director to attend the meeting as a proxy If independent directors have opposing or reserved opinions, these opinions shall be recorded in the Board meeting records; if independent directors cannot personally attend Board meeting to express their opposing or reserved opinion, they shall give a written opinion before the meeting unless they have an appropriate reason and the opinion shall be recorded in the Board meeting records.
Article 13.When the chair at a Board meeting is of the opinion that a matter has been sufficiently discussed to a degree of putting to a vote, the chair may announce the discussion closed and bring the matter to vote. When a proposal comes to a vote at a Board meeting, if the chair puts the matter before all directors present at the meeting and none voices an objection, the matter is deemed approved. If a dissent is put forth upon inquiry made by the chair, the matter shall be brought to vote.
The method of voting shall be the chair's selection of either of the following; in case an attendee is of dissenting opinion, resolution shall be made upon opinion of a bigger proportion of the attendees.
I. A show of hands or a vote by voting machine..
II. A roll call vote.

III. A vote by ballot.

IV. A vote by a method selected at the Company's discretion.

The directors present at the meeting in the preceding two paragraphs do not include directors prohibited from exercising voting rights pursuant to Article 15, paragraph 1.

Article 14.Except as otherwise stated in the Act or in the Company Act, a resolution on a matter at a Board meeting requires the approval of a majority of the directors present at the meeting that shall be attended by a majority of all directors.
When there is an amendment or an alternative to same 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. If one of the proposals is approved by vote, the rest is deemed voted down, none of which requires re-vote.
Vote monitoring and counting is appointed by the chair when necessary, provided that scrutineer shall be a director.

The result of voting shall be reported on the spot and prepared in the minutes.

Article 15.If any director or a juristic person represented by a director is an interested party with respect to any agenda item, the director shall state the important aspects of the interested party relationship at the respective meeting. When the relationship is likely to prejudice the interests of the company, the director may not participate in discussion or voting on that agenda item, and further, shall enter recusal during discussion and voting on that item and may not act as another director's proxy to exercise voting rights on that matter.

The provisions of Article 180, paragraph 2 of the Company Act, as applied mutatis mutandis under Article 206, paragraph 3 of that Act, apply to resolutions of Board meetings when a Board director is prohibited by the preceding paragraph from exercising voting rights.

Article 16.Minutes shall be prepared of the discussions at Board meetings. The meeting minutes shall record the following.
I. Session (or year), time, and place of the meeting.
II. Name of the meeting chair.
III. Attendance of directors at the meeting, including the names and the number of directors present, excused, and absent.
IV. Names and titles of those attending the meeting as nonvoting participants.
V. Name of minutes taker.
VI. Matters reported at the meeting.
VII. Discussion items: the resolution method and the result for each proposal; a summary of the comments made by directors, experts, or other persons; an explanation of the important aspects of the relationship of interest as referred to in Paragraph 1 of the preceding article, the reasons for recusal and non-recusal, and the status of recusal; opinions expressing objections or reservations at the meeting that were included in records or stated in writing; and any opinion issued in writing by an independent director under Paragraph 4, Article 12.
VIII. Extraordinary motions: the name of the mover, the resolution method and the result for each motion; a summary of the comments made by directors, experts, or other persons; the name of any director that is an interested party as referred to in Paragraph 1 of the preceding article, an explanation of the important aspects of the relationship of interest, the reasons for recusal and non-recusal, and the status of their recusal; opinions expressing objections or reservations at the meeting that were included in records or stated in writing.
IX. Other matters required to be recorded.
Any of the following matters in relation to a resolution passed at a meeting of the Board shall be stated in the meeting minutes and within two days of the meeting be published on Market Observation System designated by Financial Supervisory Commission.
I. Any matter about which an independent director expresses an objection or reservation that has been included in records or stated in writing.
II. Any matter that has not been passed by the audit committee, but has been adopted with the approval of two-thirds or more of all Board directors.

The attendance book forms a part of the minutes for each Board meeting and shall be well preserved during the existence of the company.

The minutes of a Board meeting shall bear the signature or seal of both the meeting chair and the minute taker; a copy of the minutes shall be distributed to each director within 20 days after the meeting, and well preserved as important company records during the existence of the company. The production and distribution of the meeting minutes referred to in paragraph 1 may be done in electronic form.

Article 17.Apart from matters referred to in paragraph 1 of Article 12, which are required to be submitted for discussion by the Board, when the Board delegates any exercise of its powers pursuant to laws or regulations or the company's articles of incorporation, matters such as the level and substance of the delegation shall be concretely and specifically set out.
Article 18.The provisions of Article 2, paragraph 2 of Article 3, Articles 4 to 6, Article 8 to 11, and Articles 13 to 16 shall apply mutatis mutandis to the procedure for meetings of the managing directors of the Company, provided that if a meeting of managing directors is scheduled to be convened within seven days, the notice to each managing director may be made two days in advance.
Article 19.Adoption and amendment of these regulations shall be approved by the Board of the Company and submitted to Shareholders' meeting for reporting.

Appendix 7

Chung Hwa Pulp Corporation

Comparison table of Amended Provisions of the Articles of Incorporation

Sequence number of the article	Amended Article	Current Article	Description
Article 2	The scope of business operations of the Company is as below: 1. Production, merchandising, and dealership of pulp and papers. 2. Business related to paper pulp materials and by-products. 3. Business of lumbering, afforestation, wood making, wood processing. 4. Design, manufacturing, and merchandising of related machinery. 5. Business related to manufacturing and marketing of chemicals and by-products. 6. Commissioned construction of office buildings and public housing for lease and sale. 7. D101050 Cogeneration business. 8. C114010 Food additives manufacturing. 9. F121010 Wholesale of food additives. 10. F221010 Retail of food additives. 11. C805020 Plastic sheets & bags manufacturing. 12. F107190 Wholesale of plastic sheets & bags. 13. F207190 Retail sale of plastic sheets & bags.	The scope of business operations of the Company is as below: 1. Production, merchandising, and dealership of pulp and papers. 2. Business related to paper pulp materials and by-products. 3. Business of lumbering, afforestation, wood making, wood processing. 4. Design, manufacturing, and merchandising of related machinery. 5. Business related to manufacturing and marketing of chemicals and by-products. 6. Commissioned construction of office buildings and public housing for lease and sale. 7. D101050 Cogeneration business.	The scope of business is added due to business needs.

Article 3	The Company establishes its headquarters in Hualien County, Taiwan, and opens subsidiaries or branch offices and production/marketing units as needed.	The Company establishes its headquarters in Hualien County, TaiwanProvince ,and opens subsidiaries or branch offices and production/marketing units as needed.	Taiwan Province is deleted.
Article 35	These Articles were formulated on Jul 5, 1968 (followed by the 1st to the 43rd amendments, with dates omitted);and 44th amended on June 26, 2018 .	These Articles were formulated on Jul 5, 1968 (followed by the 1st to the 43rd amendments, with dates omitted).	The date of the 44th amendment is added.

Chung Hwa Pulp Corporation Articles of Incorporation (Revised)

Chapter I General Provisions

Article 1 The Company is organized pursuant to the stipulations of company limited by shares of the Company Act. The name of the Company is Chung Hwa Pulp Corporation.

Article 2 The scope of business operations of the Company is as below:

Production, merchandising, and dealership of pulp and papers.
Business related to paper pulp materials and by-products.
Business of lumbering, afforestation, wood making, wood processing.
Design, manufacturing, and merchandising of related machinery.
Business related to manufacturing and marketing of chemicals and by-products.
Commissioned construction of office buildings and public housing for lease and sale.
D101050 cogeneration business.
C114010 Food additives manufacturing.
F121010 Wholesale of food additives.
F221010 Retail of food additives.
C805020 Plastic sheets & bags manufacturing.
F107190 Wholesale of plastic sheets & bags.
F207190 Retail sale of plastic sheets & bags.
Article 3 The Company establishes its headquarters in Hualien County, Taiwan, and opens subsidiaries or branch offices and production/marketing units as needed.
Article 4 Public announcements of the Company are made pursuant to Article 28 of the Company Act.
Article 5 The Company can only engage in external guarantee and endorsement of notes with companies, and under circumstances provided in the following:
Operations necessary for the business of the Company and investees.
Guaranteeing transactions for another company in the same industry.
Article 6 The Company's investments in other enterprises is not be subject to the limit of 40% of its paid-in capital as imposed by Article 13 of the Company Act.

Chapter II Shares

Article 7 The total amount of capital of the Company is NTD 13 billion, being divided into 1.3 billion shares of par value NTD 10 per share, and authorizing the Board to issue in installments.

Article 8 The registered share certificates the Company adopts are affixed with signature or seal of three or more directors, indicating thereon the paragraphs of Article 162 of the Company Act, assigned with serial numbers, and duly certified or authenticated by the competent authority or a certifying institution appointed by the competent authority before issuance.
The Company may be exempted from printing the aforesaid share certificates provided that it shall appoint a centralized securities custody enterprise to make recordation of the issue of such shares.
Article 9 Upon opening a new account, the shareholder shall supply a specimen chop, where the specimen chop is registered, replaced, lost, destroyed, or upon transfer of stock certificates, registration of change, pledges, and lost reporting procedures, the Regulations Governing the Administration of Shareholder Services of Public Companies promulgated by competent authority shall apply.
Article 10 The original copies and application should be submitted to the Company for the renewal of soiled or mutilated stock certificates; however, when authenticity is beyond recognition, the preceding provision of lost share certificates applies, mutatis mutandis.
Article 11 Taiwan Depository & Clearing Corporation may request a large par value securities substitute by

means of consolidation, in which the costs are borne by the company.

Article 12 Where the Company processes a shareholder's application to issue replacement stocks due to splits and such split stocks do not exceed 1,000 shares, the company may charge a handling fee, except where the stocks were obtained through inheritance.
Article 13 The Company shall not handle any requests for transfers of shares within 60 days prior to the regular shareholders' meeting, 30 days prior to the special shareholders meeting, or 5 days prior to the record date for the distribution of dividends, bonuses or other interests.

Chapter 3 Shareholders’ Meeting

Article 14 Shareholders' meeting of the Company shall be of the following two kinds: regular meeting of shareholders and special meeting of shareholders.
Regular meeting of shareholders shall be convened within 6 months after close of each fiscal year.
Special meeting of shareholders is held when necessary pursuant to the Company Act.
Article 15 Convening of regular and special shareholder's meeting shall notify each registered shareholder 30 and 15 days prior to meeting date respectively.
Article 16 Resolutions at a shareholders' meeting shall, unless otherwise provided for in 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 Except in the circumstances set forth in Item 3, Article 157 of the Company, a shareholder shall have one voting power in respect of each share in his/her/its possession.
The shares shall have no voting power under any of the following circumstances:
The share(s) of a company that are held by the issuing company itself in accordance with the laws;
The shares of a holding company that are held by its subordinate company, where the total number of voting shares or total shares equity held by the holding company in such a subordinate company represents more than one half of the total number of voting shares or the total shares equity of such a subordinate company;
The shares of a holding company and its subordinate company(ies) that are held by another company, where the total number of the shares or total shares equity of that company held by the holding company and its subordinate company(ies) directly or indirectly represents more than one half of the total number of voting shares or the total share equity of such a company.
Article 17-1 The voting power at a shareholders' meeting shall be exercised by way of electronic transmission, and may in writing, provided that the method for exercising the voting power shall be described in the shareholders' meeting notice to be given to the shareholders if the voting power will be exercised in writing or by way of electronic transmission.

A shareholder who exercises his/her/its voting power at a shareholders meeting in writing or by way of electronic transmission as set forth in the preceding Paragraph shall be deemed to have attended the said shareholders' meeting in person, but shall be deemed to have waived his/her/its voting power in respective of any extemporary motion(s) and/or the amendment(s) to the contents of the original proposal(s) at the said shareholders' meeting.

Article 18 Where a shareholder is unable to do so in person, he or she may appoint a proxy to attend a shareholders' meeting in his/her/its behalf by executing a power of attorney printed by the company stating therein the scope of power authorized to the proxy. When a person who acts as the proxy for two or more shareholders, the number of voting power represented by him/her shall not exceed 3% of the total number of voting shares of the company. Otherwise, the portion of excessive voting power shall not be counted.
Article 19 The chairperson of the Board shall preside the shareholders' meeting unless the Company Act provides otherwise. In case the chairperson of the Board is absent for any cause, the chairperson shall designate one of the directors; in the absence of such a designation, the directors shall elect one from among

themselves to preside.

Article 20 Resolutions adopted at a shareholders' meeting shall be recorded in the minutes of the meeting, which shall be affixed with the signature or seal of the chair of the meeting; and shall be distributed to all shareholders of the company within 20 days after the close of the meeting. The preparation and distribution of the minutes of shareholders' meeting may be effected by means of electronic transmission. The aforesaid distribution of the minutes of shareholders' meeting may be effected by means of public notice. The minutes shall be kept persistently throughout the life of the company; the attendance list bearing the signatures of shareholders present at the meeting and the powers of attorney of the proxies shall be kept by the company for a minimum period of at least 1 year. However, if a lawsuit has been instituted by any shareholder in accordance with the provisions of Article 189 hereof, the minutes of the shareholders' meeting involved shall be kept by the company until the legal proceedings of the foregoing lawsuit have been concluded.

Chapter IV Directors

Article 21 The Company has 7 to 11 directors, of which the Board decides the number of directors to be elected within range, and adopts the candidate nomination system for shareholders' meeting to elect from among the nominees listed in the roster of director candidates pursuant to Article 198 of the Company Act.
In the aforesaid quota of directors, independent directors shall be at least 3, representing one fifth or more of all directors. Regulations governing the professional qualifications, restrictions on shareholdings and concurrent positions held, assessment of independence, method of nomination and selection, and other matters for compliance with respect to independent directors shall follow prescriptions of the securities competent authority.
Article 21-1 The Company already establishes audit committee starting from the 17th Board, including no less than 3 independent directors; among independent directors, 1 is convenor and at least 1 is required to have accounting or financial expertise. Audit committee's exercise of powers, organic regulations, and other matters for compliance shall follow applicable laws or corporate regulations.
Article 22 The total registered shares owned by all directors shall not be less than the minimum percentage of total issued shares specified in the Rules and Review Procedures for Director and Supervisor Share Ownership Ratios at Public Companies.
Article 23 When the number of vacancies equals to one third of the total number of directors, the Board shall call, within 30 days, a special meeting of shareholders to elect succeeding directors to fill the vacancies. A by-elected succeeding director's term of office is not exceeding the remainder of his or her predecessor.
Article 24 The directors form the Board to exercise power and authority and elect a chairperson of the Board from among themselves in accordance with the regulations; in case the chairperson is on leave or absent or cannot exercise his power and authority for any cause, he or she shall designate 1 director to act on his or her behalf. In the absence of such a designation, the directors shall elect from among themselves an acting chairperson.
Article 25 The Board may decide on pledge of property when financing facility is necessary for business operation.
Article 26 The notice of Board meeting may be effected by means of electronic transmission. Unless otherwise provided for in Company Act, resolutions of the Board shall be adopted by a majority of the directors at a meeting attended by a majority of the directors. A director may appoint another director as his/her proxy to attend the Board meetings.

In case a Board meeting is held by video conference, then the directors taking part in such a video conference shall be deemed to have attended the meeting in person.

Article 27 The remuneration of directors shall be determined by a meeting of shareholders. Employees' payroll shall be paid pursuant to ordinary standards regardless of profit and loss status of the Company.

Chapter V Managerial officers

Article 28 The Company may establish managerial personnel whose title, appointment, discharge and remuneration shall follow Article 29 of the Company Act.
Article 29 The general manager of the Company manages daily corporate operations pursuant to the Board resolutions, supported by vice general president and vice president.

Chapter VI Accounting

Article 30 The Company’s accounting period ends at the end of December. The Board of Directors shall prepare the following documents related to accounting affairs, and then present and acknowledge them at the shareholder meeting pursuant to related laws and regulations.

Business report
Financial statements
Earnings distribution or accumulated deficit offset proposal
Article 31 In profitable years, the Company shall allocate no less than 1% of profit of the current year as employees' compensation, while allocate no more than 2% as directors' compensation. However, the company's accumulated losses shall have been covered.

Compensation of directors is distributed by cash; compensation of employees, include employees of subsidiaries of the company meeting certain specific requirements, is distributed by cash or stock and authorizing the Board to decide on such requirements. Directors' ratio of compensation, employees' payment method and ratio of compensation shall be paid after a resolution has been adopted by a majority vote at a meeting of the board of directors attended by two-thirds of the total number of directors and shall report to the shareholders' meeting.

In calculating employees and directors' compensation, profit of the current year (i.e. pre-tax profit before distribution of employees and directors' compensation) shall first deduct accumulated deficit and the resulting balance is used for calculation of employees and directors' compensation.

Article 31-1 Where the Company has final earnings in a year, except for income tax payable as required, it shall first cover its previous losses, then set aside 10% legal reserve and special reserve as required from the remainder, as well as necessary special reserve or retained earnings according to its judgement; the remaining may be paid as dividends of common shares and bonus according to the total amount of shares.
Article 32 In consideration of economic situation and long-term financial planning, and for the purpose of sustainable and stable development, the Company's dividend policy depends on its judgement based on capital budging for the coming years; need of funds is first financed by means of retained earnings, followed by necessary reserves for business operations, no less than 20% of remaining earnings is distributable as cash dividends, while the remainder is distributable as stock dividends. In case capital expenditure is necessary, the aforesaid surplus earnings may be distributed in full by means of stock dividends.

Chapter VII Supplemental provisions

Article 33 Organic regulations and operational regulations of the Company shall be developed separately.

Article 34 Matters unspecified in these Articles shall follow the Company Act and other relevant laws.

Article 35 Formulated on Jul 5, 1968; 1st amended on July 3, 1969; 2nd amended on Mar 5, 1970; 3rd amended on Mar 31, 1971; 4th amended on Mar 28, 1972; 5th amended on Mar 8, 1973; 6th amended on Mar 21, 1974; 7th amended on Mar 27, 1975; 8th amended on Mar 25, 1976; 9th amended on Jul 20, 1976; 10th amended on Mar 15, 1977; 11th amended on Mar 23, 1978; 12th amended on Mar 21, 1979; 13th amended on Mar 21, 1980; 14th amended on Nov 26, 1980; 15th amended on Mar 27, 1981; 16th amended on Sep 8, 1981; 17th amended on Mar 31, 1982; 18th amended on Mar 31, 1983; 19th amended on Mar 30, 1984; 20th amended on Mar 26, 1985; 21st amended on Mar 27, 1986; 22nd amended on Mar 24, 1987; 23rd amended on Mar 25, 1988; 24th amended on Mar 24,

1989; 25th amended on Mar 23, 1990; 26th amended on Mar 28, 1991; 27th amended on Jun 4, 1991; 28th amended on Mar 28, 1992; 29th amended on Mar 31, 1993; 30th amended on Mar 27, 1995; 31st amended on Mar 27, 1996; 32nd amended on May 8, 1997; 33rd amended on May 14, 1998; 34th amended on Apr 29, 1999; 35th amended on May 9, 2000; 36th amended on May 14, 2002; 37th amended on May 27, 2004; 38th amended on Jun 6, 2006; 39th amended on Jun 13, 2007; 40th amended on Jun 13, 2008; 41st amended on Jun 27, 2012; 42nd amended on Jun 25, 2013; 43rd amended on Jun 24, 2016; and 44th amended on June 26, 2018.

Appendix 8

Chung Hwa Pulp Corporation

Comparison table of Amended Provisions of the Procedures for Acquisition or Disposal of

Assets

		Assets
Sequence number of the article	Amended Article	Current Article	Description
Article 7	The Company shall handle the acquisition or disposal matters based on type of the assets in compliance with the procedures: I. Application: In acquiring or disposing of assets, the handling divisions shall evaluate the gain-/losses based on methods sufficient to assure the Company's interest of the investment, meeting with relevant divisions where necessary, and follow the corporate authorization for approval. Due to their extremely low risks of trading, the following assets are exempted from the evaluation before investment: 1. Trading of bonds under repurchase and resale agreements. 2. Subscription or redemption of money market funds issued by domestic securities investment trust enterprises. II. Value appraisal: ............	The Company shall handle the acquisition or disposal matters based on type of the assets in compliance with the procedures: I. Application: In acquiring or disposing of assets, the handling divisions shall evaluate the gain-/losses based on methods sufficient to assure the Company's interest of the investment, meeting with relevant divisions where necessary, and follow the corporate authorization for approval. II. Value appraisal: ............	This subparagraph clearly stipulates that conditional transactions and domestic money market funds are exempted from the evaluation before investment due to their extremely low risks of trading.
Article 12	Matters that are not specified herein shall proceed in compliance with the provisions of Regulations Governing the Acquisition and Disposal of Assets by Public Companies. Subsidiaries of the Company may formulate their own procedures for acquisition and disposal of assets based on their operational needs, or shall comply with these Procedures.	Matters that are not specified herein shall proceed in compliance with the provisions of Regulations Governing the Acquisition and Disposal of Assets by Public Companies.	The paragraph clearly stipulates the procedures that shall be followed by subsidiaries when trading assets.

Chung Hwa Pulp Corporation

Procedures for Acquisition or Disposal of Assets (Revised)

(Ground)

Article 1 The handling procedures are established pursuant to the provisions of Regulations Governing the Acquisition and Disposal of Assets by Public Companies.

(The scope of assets)

Article 2 The company that engages in any related party transaction, derivatives trading, or conducts a merger, demerger, acquisition, or transfer of shares of enterprises shall proceed in compliance with the provisions of respective applicable handling procedure. Other than such matters, the term "assets" as used herein include the following:
I. Investments in stocks, government bonds, corporate bonds, financial bonds, securities representing interest in a fund, depository receipts, call (put) warrants, beneficial interest securities, and asset-backed securities.
II.Real property (including land, houses and buildings, investment property, rights to use land, and construction enterprise inventory) and equipment.
III. Memberships.
IV. Patents, copyrights, trademarks, franchise rights, and other intangible assets.
V. Claims of financial institutions (including receivables, bills purchased and discounted, loans, and overdue receivables).
VI. Other major assets.

(Investment limits)

Article 3 The limits governing the investments undertaken by the Company are as follows:

I. Total amounts of real estate acquired for non-business use shall not exceed 10% of total assets.
II.The amount or proportion of Mainland China area investments shall not exceed the upper limit of such laid down by the competent authority.
III.Total amount of long-term securities investment abroad (including Mainland China area investment) shall not be subject to the restriction of 40% of the Company's paid-in capital in compliance with the Articles of Incorporation while among them, any single investment shall not exceed 75% of total assets, except where otherwise resolved by the shareholders' meeting.
IV. Total amount of short-term securities investments shall not exceed 100% of total assets any single investment shall not exceed 75% of total assets.

Total amount of acquirable real estate or securities of the Company's subsidiaries and the limits of any single securities among them shall be governed by the same with the parent company's.

(Application of public announcement)

Article 4 Under any of the following circumstances, the company acquiring or disposing of assets shall publicly

announce and report the relevant information on the competent authority's designated website in the appropriate format as prescribed by regulations within 2 days commencing immediately from the date of occurrence of the event:

I. Where the type of asset acquired or disposed is equipment/machinery for business use, the trading counterparty is not a related party, and the transaction amount is NT$1 billion or above.
II.Where the real estate acquired or disposed is for construction use, the trading counterparty is not a related party, and the transaction amount is NT$500 million or above.
III. Where real estate is acquired under an arrangement on engaging others to build on the company's own land, engaging others to build on rented land, joint construction and allocation of housing units, joint construction and allocation of ownership percentages, or joint construction and separate sale, and the amount the company expects to invest in the transaction is NT$500 million or above.
IV. Where an asset transaction or an investment in the mainland China area other than any of those referred to in the preceding three subparagraphs reaches 20 percent or more of paid-in capital or NT$300 million, provided, this shall not apply to the following circumstances:
Trading of government bonds.
Securities trading by investment professionals on foreign or domestic securities exchanges or over-the-counter markets, or subscription of ordinary corporate bonds and non-equity-linking financial bonds in the domestic primary market.
Trading of bonds under repurchase/resale agreements, or subscription or redemption of domestic money market funds.

The amount of transactions above shall be calculated as follows:

I. The amount of any individual transaction.
II.The cumulative transaction amount of acquisitions and disposals of the same type of underlying asset with the same trading counterparty within the preceding year.
III. The cumulative transaction amount of real property acquisitions and disposals (cumulative acquisitions and disposals, respectively) within the same development project within the preceding year.
IV. The cumulative transaction amount of acquisitions and disposals (cumulative acquisitions and disposals, respectively) of the same security within the preceding year.

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

(Non-NTD transactions)

Article 5 Where a transaction is denominated in a currency other than NTD, calculation of amount shall be based on US$ equivalents or other foreign currencies.

(Calculation of transaction amounts)

Article 6 Transaction amount refers to the agreed price upon acquiring or disposing of assets. All the necessary

expenses paid for prior to the status of use are not included in the calculation basis notwithstanding the accounting requirement of asset cost recording.

(Handling Procedures)

Article 7 In acquiring or disposing of assets, following handling procedures shall be adopted accordingly based on respective type of assets:

I. Application:

In acquiring or disposing of assets, the handling divisions shall evaluate the gain-/losses based on methods sufficient to assure the Company's interest of the investment, meeting with relevant divisions where necessary, and follow the corporate authorization for approval.

Due to their extremely low risks of trading, the following assets are exempted from the evaluation

before investment:

Trading of bonds under repurchase and resale agreements.
Subscription or redemption of money market funds issued by domestic securities investment trust enterprises.
II.Value appraisal:
In acquiring or disposing of real property or equipment where the transaction amount reaches 20 percent of the company's paid-in capital or NTD300 million or more, the company, unless transacting with a government agency, engaging others to build on its own land, engaging others to build on rented land, or acquiring or disposing of equipment for business use, shall obtain an appraisal report prior to the date of occurrence of the event from a professional appraiser and shall further comply with the following provisions:
(1). Where the discrepancy between the appraisal result and the transaction amount is 20% or more of the transaction amount, unless all the appraisal results for the assets to be acquired are higher than the transaction amount, or all the appraisal results for the assets to be disposed of are lower than the transaction amount, a certified public accountant shall be engaged to perform the appraisal in accordance with the provisions of Statement of Auditing Standards No. 20 published by the ROC Accounting Research and Development Foundation and render a specific opinion regarding the reason for the discrepancy and the appropriateness of the transaction price. The discrepancy between the appraisal results referred to shall be based on transaction amount.
(2). Where the transaction amount is NTD1 billion or more, appraisals from two or more professional appraisers shall be obtained; where the discrepancy between the appraisal results is 10% or more of the transaction amount, unless all the appraisal results for the assets to be acquired are higher than the transaction amount, or all the appraisal results for the assets to be disposed of are lower than the transaction amount, a certified public accountant shall be engaged to perform the appraisal in accordance with the provisions of Statement of Auditing Standards No. 20 published by the ROC Accounting Research and Development Foundation and render a specific opinion regarding the reason for the discrepancy and the appropriateness

of the transaction price.

(3). Where the appraisal is obtained prior to the contract execution date, no more than 3 months may elapse between the date of the appraisal report issued by a professional appraiser and such date, provided where the publicly announced current value for the same period is used and not more than 6 months have elapsed, an opinion may be issued for supplementation and correction by the original professional appraiser.
(4). In addition to employment of a limited price, specified price, or special price as the reference basis for the transaction price in acquiring or disposing of assets for construction use, if an appraisal report cannot be obtained in time and there is a legitimate reason for the delay, the report, and the certified public accountant's opinion on the paragraph 1&2, shall be obtained within 2 weeks commencing immediately from the date of occurrence.
The company acquiring or disposing of securities shall, prior to the date of occurrence of the event, obtain financial statements of the issuing company for the most recent period, certified or reviewed by a certified public accountant, for reference in appraising the transaction price, and if the dollar amount of the transaction is 20 percent of the company's paid-in capital or NT$300 million or more, the company shall additionally engage a certified public accountant prior to the date of occurrence of the event to provide an opinion regarding the reasonableness of the transaction price. If the CPA needs to use the report of an expert as evidence, the CPA shall do so in accordance with the provisions of Statement of Auditing Standards No. 20 published by the ROC Accounting Research and Development Foundation. Such requirement does not apply, however, to publicly quoted prices of securities that have an active market, or where otherwise provided by regulations of the securities competent authority.
Where the Company acquires or disposes of memberships or intangible assets and the transaction amount reaches 20 percent or more of paid-in capital or NT$300 million or more, except in transactions with a government agency, the company shall engage a certified public accountant prior to the date of occurrence of the event to render an opinion on the reasonableness of the transaction price; the CPA shall comply with the provisions of Statement of Auditing Standards No. 20 published by the ROC Accounting Research and Development Foundation.
Where the Company acquires or disposes of assets through court auction procedures, the evidentiary documentation issued by the court may be substituted for the appraisal report or CPA opinion.
Professional appraisers and their staff, certified public accounts, attorneys, and securities underwriters that provide the Companies with appraisal reports, certified public accountant's opinions, attorney's opinions, or underwriter's opinions shall not be a related party under the Regulations Governing the Preparation of Financial Reports by Securities Issuers.
The calculation of the transaction amounts shall be done in accordance with article 4 herein, and "within 1 year" as used herein refers to the year preceding the date of occurrence of the current transaction. Items for which an appraisal report from a professional appraiser or a CPA's opinion has been obtained as per procedures herein need not be counted toward the transaction amount.
III. Bidding, price comparison or negotiation:
After the assessment, department of asset administration shall set a base price and proceed in

compliance with bidding or price comparison; where bidding or price comparison is not possible in practice, negotiation may be adopted.

IV. Signing of contract

In entering into a contract with counterparty, the result of price comparison or negotiation shall be adopted and effort shall be made to assure the company rights and interests.

V.Public announcement and regulatory filing procedures.

Article 4 herein, the undertaking division shall notify financial and accounting dept. in the prescribed format based on its nature; financial and accounting dept. shall publicly announce and report the relevant information on the website designated by the competent authority within 2 days commencing immediately from the date of occurrence of the event.

Where at the time of public announcement an error or omission in an item required to be publicly announced is made and so is required to be corrected, all the items shall be again publicly announced and reported in their entirety within 2 days commencing immediately from the date of becoming aware of such fact.

In the wake of public report, where change, termination, or rescission of a contract signed in regard to the original transaction or change to the originally publicly announced and reported information occurs, a public report of relevant information shall be made on the website designated by the competent authority within 2 days commencing immediately from the date of occurrence of the event.

VI. Submission to the Board
Where due to special circumstances it is necessary to give a limited price, specified price, or special price as a reference basis for the transaction price, with amount meeting the criteria requiring a public announcement and filing set forth in article 4, the transaction shall be approved by more than half of all audit committee members and submitted for approval by the Board resolution; in the absence of approval of more than half of all audit committee members, approval of two thirds or more of all directors shall be obtained and resolution of audit committee shall be documented in the Board meeting minutes and resolution of audit committee shall be documented in the Board meeting minutes; in case any director expresses dissent and it is contained in the minutes or a written statement, the company shall submit the director's dissenting opinion to each supervisor in case; the same procedure shall be followed for any future changes to the terms and conditions of the transaction.
Except for the preceding provision, where amount of such transaction reaches the criteria requiring a public announcement and filing set forth in article 4, a reference shall be made to the Board after the acquisition or disposition.
Where the position of independent director has been created, when the procedures for the acquisition and disposal of assets are submitted for discussion by the Board pursuant to the regulation, independent director's opinions shall be fully considered. If an independent director objects to or expresses reservations about any matter, it shall be recorded in the minutes of the Board meeting.
VII.Acceptance or checking:

Acquisition and disposal of assets shall be accepted or checked term by term, according to schedule,

pursuant to details or conditions of respective contracts; if nonconformities are found, they shall be submitted for processing.

VIII.Property Registration:

The acquisition of real estate shall be reported to the competent authority within statutory period for registration; the same applies in the event of any changes.

IX. Relevant depepartments' transaction of insurance based on nature of assets and actual situation

(Date of occurrence)

Article 8 Date of occurrence in principle refers to the date of contract signing, date of payment, date of consignment trade, date of transfer, dates of Board resolutions, or other date that can confirm the counterpart and monetary amount of the transaction, whichever date is earlier; provided, for investment for which approval of the competent authority is required, the earlier of the above date or the date of receipt of approval by the competent authority shall apply.

(Public announcement of subsidiaries)

Article 9 Where information on acquisitions and disposals of assets by a subsidiary of the Company that is not itself a public company in Taiwan is required to be publicly announced and reported, the subsidiary shall notify the Company the date of occurrence of the event; the latter shall publicly announce and report the relevant information on the securities competent authority's designated website within 2 days commencing immediately from the date of occurrence of the event pursuant to the Procedure.
The term "subsidiary" as used herein shall be defined pursuant to the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

(Penalties against negligent employees)

Article 10 In acquiring or disposing assets, the employees violating these regulations shall be subject to penalties.

(Data retention)

Article 11 The company acquiring or disposing of assets shall keep all relevant contracts, meeting minutes, log books, appraisal reports and CPA, attorney, and securities underwriter opinions at the company, where they shall be retained for 5 years except where another act provides otherwise.

(Unspecified matters)

Article 12 Matters that are not specified herein shall proceed in compliance with the provisions of Regulations Governing the Acquisition and Disposal of Assets by Public Companies.

Subsidiaries of the Company may formulate their own procedures for acquisition and disposal of assets based on their operational needs, or shall comply with these Procedures.

(Supplementary provisions)

Article 13 Adoption or amendment of the Procedure shall be approved by more than half of all audit committee members, submitted to the Board for a resolution and submitted to shareholders' meeting for adoption; if any director expresses dissent and it is contained in the minutes or a written statement, such

director's dissenting opinion shall be submitted to audit committee. Any matter that has not been approved with the consent of one-half or more of the entire membership of the Audit Committee may be adopted with the consent of two-thirds or more of the entire board of directors, and the resolution of the Audit Committee shall be recorded in the board of directors meeting minutes.

All audit committee members and all directors as used herein shall be counted as the actual number of persons currently holding those positions.

Appendix 9

Chung Hwa Pulp Corporation

Comparison table of Amended Provisions of the Procedures for Engaging in Derivatives

Trading

		Trading
Sequence number of the article	Amended Article	Current Article	Description
II	Trading principles and strategies ............ iii. Segregation of duties 1.Financial unit 1) Collection of market data, conversance with derivatives, laws and regulations, and evaluation of risks. 2) Undertaking of transaction and risk management within degree of authority delegated. 3) Provision of adequate and timely information for the head of finance department, and regular review of profit-loss circumstances. 4) Preparation of log books in which details of the types and amounts of derivatives trading engaged in, Board approval dates, and the matters required to be carefully evaluated by the Board or head of finance department. 2.Accounting unit 1) Confirmation of transaction. 2) Understanding of product attributes, contractual and transactional types, and recording properly. 3) Evaluation of loss and profit of trading position at the end of per month. 4)Regular financial reports shall be	Trading principles and strategies ............ 3. Segregation of duties 1.Trading department 1) Collection of market data, conversance with derivatives, laws and regulations, and evaluation of risks. 2) Undertaking of transaction and risk management within degree of authority delegated. 3) Provision of adequate and timely information for the head of finance department, and regular review of profit-loss circumstances. 4) Preparation of log books in which details of the types and amounts of derivatives trading engaged in, Board approval dates, and the matters required to be carefully evaluated by the Board or head of finance department. 2.Finance and accounting department 1) Confirmation of transaction. 2) Understanding of product attributes, contractual and transactional types, and recording properly. 3) Evaluation of loss and profit of trading position at the end of per month.	1. Departments in charge of trading, settlement, and risk control are clearly stipulated. 2. This article is reorganized.

	... v. 1. 2. ...	prepared and fully disclosed pursuant to the No. 36 of the Financial Accounting Standards Gazette published by the ROC Accounting Research and Development Foundation. 5) Check with the financial unit for settlement 6) Measurement, supervision and control of risks, and reports to the Board or management not responsible for decision-making on trading or trading position. ......... Total amount of derivatives contracts that may be traded For non-trading purpose: hedging is undertaken based on risks the Company is associated with (e.g. the risks attributable to exchange rate, interest rate or project), where the total amount of hedging contracts shall not exceed the total amount of hedged contracts. For the purpose of trading:the financial unit engaging in trading pursuant to permission granted case by case. .........	4) Regular financial reports shall be prepared and fully disclosed pursuant to the No. 36 of the Financial Accounting Standards Gazette published by the ROC Accounting Research and Development Foundation. 3. Settlement department Upon receipt of trading division's notice, engaging with financial and accounting division to check and execute the delivery. ............ 5. Total amount of derivatives contracts that may be traded (1) For non-trading purpose: hedging is undertaken based on risks the Company is associated with (e.g. the risks attributable to exchange rate, interest rate or project), where the total amount of hedging contracts shall not exceed the total amount of hedged contracts. For the purpose of trading:personnel engaging in trading pursuant to permission granted case by case. ............
III	... 2.	......... Execution unit The financial unit carries out a trade within the above authorization or on an ad hoc approval basis.	............ 2. Execution unit Trading division carries out a trade within the above authorization or on an ad hoc approval basis.	Duties of each unit are clearly stipulated.
VI	Internal control system ............ 5. Operational risk management The functions of dealing, confirmation and settlement of derivatives tradingshall be		Internal control system ............ 5. Operational risk management 1) The functions of dealing, confirmation and settlement of derivatives tradingshall be	This article is reorganized.

	performed by different personnel. ............	......	2)	performed by different personnel. Risk assessment, monitoring and control shall be performed by personnel from division other than the above, and report to the Board or senior management irresponsible for trading or position decision-making. .
			.....
VII	Principles of Board supervision & management i. Principles of Board supervision 1`、` Head of financial and accounting shall at all times monitor and control risks of derivatives trading. 2`、` Each routine Board meeting shall conduct periodic evaluations over whetherthe parent company and subsidiaries in the consolidated financial statements perform derivative trading in compliance with established operational strategies and whether risk-taking is within a permitted scope. ............	Principles of Board supervision & management i. Principles of Board supervision 1`、` Head of financial and accounting shall at all times monitor and control risks of derivatives trading. 2`、` The Board conducts periodic evaluation over whether performance of derivative trading is in compliance with established operational strategies and whether risk-taking is within a permitted scope. ............			This subparagraph clearly stipulates the frequency of the Board's evaluations on performance of derivatives trading and companies covered in the evaluations.

Chung Hwa Pulp Corporation

Procedures of Engaging for Derivatives Trading (Revised)

I.Purpose

For establishment of risk management system regarding derivatives trading of the Company, the procedures herein are adopted pursuant to the Regulations Governing the Acquisition and Disposal of Assets by Public Companies.

II. Trading principles and strategies
i. Types of derivatives that may be traded
1. The term "derivative(s)" as used herein includes forward contracts, options contracts, futures contracts, leverage contracts, and swap contracts, and compound contracts combining the above products, whose value is derived from assets, interest rates, foreign exchange rates, indexes or other interests.
2. The term "forward contract(s)" does not include insurance contracts, performance contracts, after-sales service contracts, long-term leasing contracts, or long-term purchase (sales) agreements.

ii. Operating or hedging strategies

Trading or non-trading purpose shall be clearly defined, primarily to avert risk, and to establish a sound internal control system; selection of counterparties shall be amid the financial institutions that are well established or have business relationship with the Company.

iii. Segregation of duties

1. Financial unit

1) Collection of market data, conversance with derivatives, laws and regulations, and evaluation of risks.
2) Undertaking of transaction and risk management within degree of authority delegated.
3) Provision of adequate and timely information for head of financial and accounting division, and regular review of profit-loss circumstances.
4) Preparation of log books in which details of the types and amounts of derivatives trading engaged in, Board approval dates, and the matters required to be carefully evaluated by the Board or head of financial and accounting division.

2. Accounting unit

1) Confirmation of transaction.
2) Understanding of product attributes, contractual and transactional types, and recording properly.
3) Evaluation of loss and profit of trading position at the end of per month.
4) Regular financial reports shall be prepared and fully disclosed pursuant to the No. 36 of the Financial Accounting Standards Gazette published by the ROC Accounting Research and Development Foundation.

5) Check with the financial unit for settlement

6) Measurement, supervision and control of risks, and reports to the Board or management - not responsible for decision making on trading or trading position.

iv. Essence of performance evaluation

Regular review is performed based on reliable valuation model and principles of robustness and consistency, and reports are prepared for head of financial and accounting division for his or her reference and administration.

v. Total amount of derivatives contracts that my be traded
For non-trading purpose: hedging is undertaken based on risks the Company is associated with (e.g. the risks attributable to exchange rate, interest rate or project), where total amount of hedging contracts shall not exceed total amount of hedged contracts.
For the purpose of trading: the financial unit engaging in trading pursuant to permission granted case by case.
vi. Maximum loss limit
Losses on individual contracts are limited to 20% of individual contractual amount; net losses

on total contracts are limited to 10% of aggregate contractual amounts. In breach of loss limits, public announcement and filing shall be made in accordance with the procedures herein.

  2. For purpose of trading, in the event losses on contracts amount to loss limit, head of financial and accounting shall evaluate the market risk, and propose to address it accordingly. For purpose other than trading, when the consolidated losses of losses on contracts with loss/profits of the hedged position amount to the loss limit, head of financial and accounting shall then evaluate market risk and propose to address it accordingly.

III.Operating procedures
i. Authorized limits
1. Below are the authorized limits to derivatives trading for non-trading purpose. For the purpose of business development, or in response to change and extraordinary situation in the market, with Board approval, the authorized limits may not apply.

Unit: US$

Authorization holder	Amount of single trade	Daily trading volume
Chairman	Over5million	Over 10million
Chief financial officer	5 million or less	10 million or less

  2. The Company shall report to the soonest Board meeting after it authorizes relevant personnel to handle derivatives trading for non-trading purpose in accordance with the procedures.

  3. The Company shall report to the Board regarding its derivatives trading case for trading purpose for approval to proceed to trading.

ii.Execution unit
The financial unit carries out a trade within the above authorization or on an ad hoc approval basis.
IV. Procedure for public announcement and filing
i.The Company shall compile monthly reports on the status of derivatives trading engaged in (for trading and non-trading purpose) up to the end of the preceding month by itself and any subsidiaries that are not domestic public companies and enter the information in the prescribed format into the information reporting website designated by the FSC by the 10th day of each month; when at the time of public announcement an error or omission in an required item is publicly announced and so is required to be corrected, all the items shall be again publicly announced and reported in their entirety.
ii.Where the Company's losses from derivatives trading reach the limits on aggregate losses or losses on individual contracts set out in the procedures, a public report of relevant information shall be made on the information reporting website designated by the FSC within 2 days commencing immediately from the date of occurrence of the event.
V.Accounting processing method
i. Set-up of memorandum entries to log relevant information on derivatives trading.
ii.Set-up of separate account to clearly record loss and profit profile.
VI. Internal control system
i. Risk management measurement
1. Credit risk management

Selection of counterparties shall be well-established financial institutions; avoidance of over-concentration on single counterparty.

Market risk management
1) Authorization holder at all levels shall strictly obey the provisions of authorized limit and maximum loss.
2) Timely evaluation of potential loss amount and probability of loss event due to movements of interest rate and exchange rate to take measures properly.
Liquidity risk management
Attention is put in the size, depth, mobility of product market and trading capacity of financial institutions in order to keep liquid.

4. Cash flow risk management

Whether the company's operating cash flow is sufficient support settlement of derivatives shall be under strict control.

Operational risk management

The functions of dealing, confirmation and settlement of derivatives trading shall be performed by different personnel.

Legal risk management
- 1) Engaging with department of legal affairs regarding the contract contents
- 2) Confirmation of counterparties' validity and authorization to derivatives trading.
ii.Regular evaluation methods

Positions held in derivatives trading shall be assessed at least once weekly. For hedging trades held for business needs, assessment shall be undertaken at least twice monthly. The evaluation report shall be remitted to head of financial and accounting division.

VII. Principles of Board supervision & management

i. Principles of Board supervision
Head of financial and accounting shall at all times monitor and control risks of derivatives trading.
Each routine Board meeting shall conduct periodic evaluations over whether the parent company and subsidiaries in the consolidated financial statements perform derivative trading in compliance with established operational strategies and whether risk-taking are within a permitted scope.
ii.Principles of Board management
1 、 Head of financial and accounting division shall regularly evaluate its current risk management measures to identify whether provisions of Regulations Governing the Acquisition and Disposal of Assets by Public Companies and procedure for derivatives trading of the Company are followed.
2 、 Head of financial and accounting division shall supervise trading and loss-profit status; when irregular circumstances are found, appropriate measures shall be adopted and a report immediately made to the Board. Where the Company has independent directors, an independent director shall be present at the Board meeting and express an opinion.

VIII.Internal audit system

The Company's internal audit personnel shall periodically make a determination of the suitability of internal controls on derivatives and conduct a monthly audit of how derivatives trading by the trading division adheres to the procedures for engaging in derivatives trading, analyzing the trading cycle, and prepare an audit report. In the event of material violations, audit committee shall be notified in writing. IX. Date of occurrence

Date of occurrence in principle refers to the date of contract signing, date of payment, date of consignment trade, date of transfer, dates of Board resolutions, or other date that can confirm the counterpart and monetary amount of the derivatives trade, whichever date is earlier; provided, for investment for which approval of the competent authority is required, the earlier of the above date or the date of receipt of approval by the competent authority shall apply.

X. Controls and information disclosure on subsidiaries

The Company's subsidiary that intends to engage in derivatives trading shall not only follow its own requirements for derivatives trading but also pursuant to the procedure herein. Where the subsidiary that is not itself a public company in Taiwan, items on derivatives trading required to be publicly announced and reported shall be performed by the Company. The term "subsidiary" as used herein shall be defined pursuant to the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

XI. Penalties against negligent employees

When engaging in derivatives trading, personnel disobeying the procedures herein shall incur penalties. XII. Data retention

When engaging in derivatives trading, the Company shall keep all relevant contracts, meeting minutes, log books, appraisal reports and certified public accountant, attorney, and securities underwriter opinions at the Company, where they shall be retained for at least 5 years except where another act provides otherwise.

XIII. Other matters

When the procedures herein are adopted or amended they shall be approved by more than half of all audit committee members and submitted to the Board for a resolution and shareholders' meeting for approval. If any director expresses dissent and it is contained in the minutes or a written statement, the Company shall submit the director's dissenting opinion to the Audit Committee. Any matter that has not been approved with the consent of one-half or more of the entire membership of the Audit Committee may be adopted with the consent of two-thirds or more of the entire board of directors, and the resolution of the Audit Committee shall be recorded in the board of directors meeting minutes.

All audit committee members and all directors as used herein shall be counted as the actual number of persons currently holding those positions.

Appendix 10

Chung Hwa Pulp Corporation

Comparison table of Amended Provisions of the Operational Procedures for Lending Funds to

Others

			Others
Sequence number of the article	Articles amended		The current article	Description
Article 8	............ The borrower shall pay off the principal and interest of the loan immediately at maturity. If the borrower fails to do so, the Company may dispose of or recover the loss from the collateral provided or the guarantee in accordance with the laws and regulations.		............ The borrower shall pay off the principal and interest of the loan immediately at maturity.If failing to repay the principal and interest of the loan at maturity, the borrower may request extension in advance, and may delay the repayment after the approval of the Board of Directors. If the borrower fails to do so, the Company may dispose of or recover the loss from the collateral provided or the guarantee in accordance with the laws and regulations.	The provision in conflict with the laws and regulations prescribed by the authority in charge is deleted.

Chung Hwa Pulp Corporation

Operational Procedures for Lending Funds to Others (Revised)

Article 1 To ensure that loans are collected safely, the Company establishes the Procedures in accordance with Article 15 of the Company Act and the Regulations Governing Lending of Funds and Making of Endorsements/Guarantees by Public Companies.

Article 2 The Company may lend funds to the following companies:

(1) A company or firm with which it does business.
(2) A company or firm, where short-term financing facility is necessary. The term "short-term" referred to herein shall mean one year or one operating cycle (whichever is longer).
Article 3 For a company or firm which has business dealings with the Company, the aggregate financing amount shall be limited to 40% of the Company's net worth in the previous year, and the amount lent to the single company or firm shall be limited to the total amount of purchase or sales between both parties in the previous year.
Article 4 Where the Company lends funds to another company or firm due to a need of short-term financing, it shall be subject to the following circumstances:
(1) A company in which the Company and its subsidiaries hold 20% of the shares, respectively or jointly, and having a need of short-term financing due to business needs.
(2) A company or firm having a need of short-term financing due to the purchase of materials or operating turnover.
(3) Other companies having a need of short-term financing as resolved by the Board of Directors.
Where the Company lends funds to another company or firm due to a need of short-term financing, the aggregate financing amount shall be limited to 40% of the Company's net worth in the previous year, and the amount lent to the single company or firm shall be limited to 40% of the Company's net worth.
Article 5 The aggregate financing amount shall be limited to 80% of the Company's net worth in the previous year, and the amount lent to a single company or firm shall be limited to 80% of the Company's net worth.
The restriction in Articles 2 through 4 and the preceding paragraph shall not apply to inter-company loans between foreign companies in which the Company holds, directly or indirectly, 100% of the voting shares; the aggregate financing amount for reasons of business dealings and due to a need of short-term financing shall be limited to twice the net worth of the Company at the end of the previous year, and the amount lent to a single entity shall be limited to twice the net worth of the Company. The duration of each loan shall be within a period not to exceed three years.
Article 6 Before lending funds to others, the Company shall review the borrowers and amounts in detail in accordance with the following procedures:
(1) Credit investigation

As to the laon, borrower shall apply to the Company for the financing amount in writing by providing required company and financial information.

After the Company accepts the application, related business departments of the Company shall investigate and evaluate the borrower's business, finance, solvency, credit, and profitability as well as

the purpose of the loan, and make an investigation report to be submitted to the legal and financial unit.

(2) Risk management

The related departments of the President Office of the Company shall review the impact of the loan on the Company's business operations, financial condition, and shareholders' equity.

(3) Security

When reviewing an application for a loan, the Company may request the borrower to provide a collateral recognized by the Company and to set the pledge on its chattel or real property whenever necessary, so as to ensure its claim. If a borrower provides an individual or company with considerable financial resources and credit as a replacement for a collateral, the Board of Directors may resolve in consideration of the credit investigation report. If a company is provided as a collateral, the company shall have a guarantee clause prescribed in its articles of incorporation.

(4) Ratification

After the Company conducts the credit investigation on the application for a loan, the application shall be submitted to the Chairman for approval and to the Board of Directors for resolution.

Loans of funds between the Company and its subsidiaries, or between subsidiaries, shall be submitted for a resolution to the Board of Directors pursuant to Subparagraph 4 in the preceding paragraph, and the Chairman may be authorized, for a specific borrowing counterparty, within a certain monetary limit resolved by the Board of Directors, and within a period not to exceed one year, to give loans in installments or to make a revolving credit line available for the counterparty to draw down.

The "certain monetary limit" mentioned in the preceding paragraph shall be in compliance with Paragraph 2, Article 5; that is, the limitation of the financing amount shall not apply to inter-company loans of funds between foreign companies in which the Company holds, directly or indirectly, 100% of the voting shares . In addition, the authorized limit on loans extended by the Company or any of its subsidiaries to any single entity shall not exceed 10% of the net worth on the most current financial statements of the lending company.

Article 7 The interest rate of each fund lent by the Company shall be calculated based on the market rate or cost of the fund.

Except as stipulated in Paragraph 2, Article 5, the duration of each loan shall be within one year (inclusive) or one operating cycle (whichever is longer).

Article 8 After appropriating a loan, the responsible employee shall always pay attention to the financial condition, business, and credit of the borrower and the guarantor. If a collateral is provided, the responsible employee shall be aware of any changes in the value of the collateral. In case of significant changes, the responsible employee shall report to the Chairman immediately and act according to his instructions.

When a borrower repays loans upon maturity, interests accrued shall be computed first. After the interests and principal are paid off altogether, the Company may return collateral to the borrower or cancel the mortgage.

The borrower shall pay off the principal and interest of the loan immediately at maturity. If the borrower

fails to do so, the Company may dispose of or recover the loss from the collateral provided or the guarantee in accordance with the laws and regulations.

Article 9 The Company shall prepare a memorandum book for its fund-Lending activities and truthfully record the following information: borrower, amount, date of approval by the Board of Directors, lending/borrowing date, and matters to be carefully evaluated according to the regulations. The Company shall also reserve sufficient allowance for bad debts, and shall adequately disclose relevant information in its financial reports and provide certified public accountants with relevant information for implementation of necessary auditing procedures.

The Company's internal auditors shall audit the Procedures and the implementation thereof no less frequently than quarterly and prepare written records accordingly. They shall promptly notify the members of the Audit Committee in writing of any material violation found, if any.

Article 10 If, as a result of a change in circumstances, an entity to which a fund is lent does not meet the requirements of the Procedures or the loan balance exceeds the limit, the Company shall adopt rectification plans and submit the rectification plans to the Audit Committee, and shall complete the rectification according to the schedule set out in the plan.
Article 11 The Company shall announce and report the previous month's loan balances of itself and its subsidiaries by the 10th day of each month.

The Company whose lending of funds reaches one of the following levels shall announce and report such an event within two days commencing immediately from the date of occurrence:

(1) The aggregate balance of loans to others by the Company and its subsidiaries reaches 20 percent or more of the Company's net worth as stated in its latest financial statements.
(2) The balance of loans by the Company and its subsidiaries to a single enterprise reaches 10 percent or more of the Company's net worth as stated in its latest financial statements.
(3) The amount of new lending of funds by the Company or its subsidiaries reaches NT$10 million or more, and reaches 2 percent or more of the Company's net worth as stated in its latest financial statements.

The Company shall announce and report on behalf of any subsidiary thereof that is not a public company of the Republic of China any matters that such a subsidiary is required to announce and report pursuant to Subparagraph 3 in the preceding paragraph.

"Subsidiary" and "parent company" referred to in the Procedures shall be as determined under the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

"Net worth" referred to in the Procedures shall mean the balance sheet equity attributable to the owners of the parent company under the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

"Date of occurrence" referred to in the Procedures shall mean the date of contract signing, date of payment, dates of Board of Directors' resolutions, or other dates that can confirm the counterpart and monetary amount of the transaction, whichever date is earlier.

The term "announce and report" referred to in the Procedures shall mean the process of entering data to the information reporting website designated by the Financial Supervisory Commission (FSC).

Article 12 Where a subsidiary of the Company intends to lend funds to others, it shall comply with its own procedures for lending funds to other parties and the Procedures.
Article 13 When managers and persons in charge of lending of funds to others violate the Procedures, they shall be punished.
Article 14 Matters not prescribed in the Procedures shall be governed by the Regulations Governing Lending of Funds and Making of Endorsements/Guarantees by Public Companies.
Article 15 The Procedures shall require approval by more than 1/2 of the Audit Committee, resolved by the Board of Directors and ratified in the shareholders' meeting. If any director expresses objection and it is recorded or presented in a written statement, the Company shall submit the dissenting opinions to the Audit Committee and also present it for discussion in a shareholder meeting. The same procedure shall apply to any amendments to the Procedures. Any matter that has not been approved with the consent of one-half or more of the entire membership of the Audit Committee may be adopted with the consent of two-thirds or more of the entire board of directors, and the resolution of the Audit Committee shall be recorded in the board of directors meeting minutes.
All audit committee members and all directors referred to herein shall be counted as the actual number of persons currently holding those positions.
When the Company submits the Procedures to the Board of Directors for discussion pursuant to the preceding paragraph, the Board of Directors shall take into full consideration each independent director's opinions; the independent directors' opinions specifically expressing assent or dissent and the reasons for dissent shall be included in the minutes of the board of director meeting.

Appendix 11

Chung Hwa Pulp Corporation

Rules of Procedure for the Shareholders Meetings

Unless otherwise provided in other specific regulations, the shareholder meeting of the Company shall be processed pursuant to the regulations herein.
Shareholder meetings shall present an attendance book for shareholders to sign in or hand in a sign-in card by proxy shareholders attending the meeting.

The number of shares in attendance shall be calculated according to the shares indicated by the attendance book and sign-in cards handed in plus the number of shares whose voting rights are exercised by correspondence or electronically.

The voting power at the Company's shareholder meetings shall be exercised by way of electronic transmission and may be exercised in writing, provided that the method for exercising the voting power shall be described in the shareholder meeting notice to be given to the shareholders if the voting power will be exercised in writing or by way of electronic transmission. A shareholder exercising voting rights by correspondence or electronic transmission will be deemed to have attended the meeting in person, provided that, his/her rights with respect to the extraordinary motions and amendments to original proposals of that meeting are deemed to have been waived.

A shareholder intending to exercise voting rights by correspondence or electronic transmission under the preceding paragraph shall deliver a written declaration of intent to the Company no less than two days before the date of the shareholder 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.

Attendance and voting right that may be exercised at shareholder meetings shall be calculated on the basis of the shares.

Shareholder meetings shall convene at the Company's registered office or a place convenient to attend and suitable for meeting; the meeting shall be called no earlier than 9 a.m. and no later than than 3 p.m.
When a shareholder meeting is convened by the Board, the chairperson of the Board is the chair of the meeting. In the case where the chairperson of the Board is on leave or absent or can not exercise his/her power and authority for any cause, the vice chairperson shall act on his/her behalf. In case there is no vice chairperson or the vice chairperson is also on leave or absent or unable to exercise his/her power and authority for any cause, the chairperson of the Board shall designate one of the managing directors, or where there are no managing directors, one of the directors to act on his/her behalf. In the absence of such a designation, the managing directors or the directors shall elect from among themselves an acting chairperson of the Board. When a shareholder meeting is convened by another person having the convening right, such person shall act as the chairperson of that meeting.
The appointed attorney, certified public accountant, or relevant personnel of the Company may attend the shareholder meetings.

Administrative staff in attendance at shareholder meetings shall wear an identification card or arm-band.

The entire proceedings of shareholder meetings shall be recorded on audio or video tapes and preserved for at least one year.
When the time of a meeting has arrived, the chair shall declare the meeting open immediately; in case one-half all board directors are not present, the chair may announce postponement of the meeting time, provided that only two postponements may be made and the total delay time shall not exceed one hour. When two such postponements have been made and the shares present still cannot represent sufficient outstanding shares but more than 1/3 of the total issued shares are in attendance, decisions may be made pursuant to Article 175 of the Company Act.

When, prior to the 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 shareholder meeting pursuant to Article 174 of the Company Act.

For a shareholder meeting convened by the Board, the agenda is specified by the Board; the meeting shall be conducted in accordance with the order on the agenda as specified and may not change without a Board

resolution.

The provisions of the preceding paragraph also apply to shareholder meetings convened by a party other than the Board of Directors with the power to convene.

The meeting chair may not declare the meeting closed prior to the conclusion of the last two agenda items (including extraordinary motions) without a resolution.

After a meeting is declared closed, shareholders may not elect another chair to continue the meeting at the same or a new place, provided that, if the chair declares the adjournment of the meeting in a manner in violation of rules governing the proceedings of meetings, a new chair may be elected by a resolution to be adopted by a majority of the voting rights represented by the shareholders attending said meeting to continue the proceeding of the meeting.

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.

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.

Unless the consent of the chair is obtained, each shareholder shall make no more than two speeches for an agenda item, and each speech shall not exceed five minutes. If a speaking shareholder violates the preceding regulation or digresses from the topic, the chair may stop his or her speech.
When appointing a juristic person to attend shareholder meetings, that juristic person may only designate one person as a representative.

If a corporate shareholder designates two or more representatives at a shareholder meeting, only one representative may speak on the same proposal.

In the wake of a shareholder speaking, the chair of the meeting may answer in person or designate relevant personnel to answer.
When the chair is of the opinion that a matter has been sufficiently discussed to the degree of putting to a vote, the chair may announce the discussion closed and bring the matter to vote.
When a proposal comes to a vote, vote monitoring and counting personnel are appointed by the chair, provided that vote monitoring personnel shall be shareholders. The result of voting shall be reported on the spot and included in the minutes.
During the proceeding of a meeting, the chair may declare a break according to his or her judgment.
Each shareholder shall have one vote per share, provided that, this shall not apply to shares having no voting rights or whose voting rights are unexercisable under Article 179, paragraph 2, and Article 197-1, paragraph 2.
Except as otherwise provided in the Company Act and in the Company's Articles of Association, the resolution of a proposal shall require an affirmative vote of a majority of the voting rights represented by the attending shareholders.
In the event that amendments or substitutions are provided for the same proposal, the chair may join the original proposal to decide the order of voting. When any one among them is passed, the other proposals will then be deemed rejected, and no further voting shall be required.
The chair may command order maintenance personnel (or security personnel) to maintain order at the meeting place. The order maintenance personnel (or security personnel) shall wear armbands with "order maintenance personnel" when trying to maintaining order.
These rules shall take force upon passage by resolution of a shareholder meeting; the same holds true for amendments hereto.

Appendix 12

Chung Hwa Pulp Corporation

Articles of Incorporation

The 43rd amendment dated June 24, 2016

Chapter I General Provisions

Article 1 The Company is organized pursuant to the stipulations of company limited by shares of the Company Act. The name of the Company is Chung Hwa Pulp Corporation.

Article 2 The scope of business operations of the Company is as below:

Production, merchandising, and dealership of pulp and papers.
Business related to paper pulp materials and by-products.
Business of lumbering, afforestation, wood making, wood processing.
Design, manufacturing, and merchandising of related machinery.
Business related to manufacturing and marketing of chemicals and by-products.
Commissioned construction of office buildings and public housing for lease and sale. 7. D101050 cogeneration business.
Article 3 The Company establishes its headquarters in Hualien County, Taiwan province, and opens subsidiaries or branch offices and production/marketing units as needed.
Article 4 Public announcements of the Company are made pursuant to Article 28 of the Company Act.
Article 5 The Company can only engage in external guarantee and endorsement of notes with companies, and under circumstances provided in the following:
Operations necessary for the business of the Company and investees.
Guaranteeing transactions for another company in the same industry.
Article 6 The Company's investments in other enterprises is not be subject to the limit of 40% of its paid-in capital as imposed by Article 13 of the Company Act.

Chapter II Shares

Article 7 The total amount of capital of the Company is NTD 13 billion, being divided into 1.3 billion shares of par value NTD 10 per share, and authorizing the Board to issue in installments.
Article 8 The registered share certificates the Company adopts are affixed with signature or seal of three or more directors, indicating thereon the paragraphs of Article 162 of the Company Act, assigned with serial numbers, and duly certified or authenticated by the competent authority or a certifying institution appointed by the competent authority before issuance.
The Company may be exempted from printing the aforesaid share certificates provided that it shall appoint a centralized securities custody enterprise to make recordation of the issue of such shares.
Article 9 Upon opening a new account, the shareholder shall supply a specimen chop, where the specimen chop is registered, replaced, lost, destroyed, or upon transfer of stock certificates, registration of change, pledges, and lost reporting procedures, the Regulations Governing the Administration of Shareholder Services of Public Companies promulgated by competent authority shall apply.
Article 10 The original copies and application should be submitted to the Company for the renewal of soiled or mutilated stock certificates; however, when authenticity is beyond recognition, the preceding provision of lost share certificates applies, mutatis mutandis.
Article 11 Taiwan Depository & Clearing Corporation may request a large par value securities substitute by means of consolidation, in which the costs are borne by the company.
Article 12 Where the Company processes a shareholder's application to issue replacement stocks due to splits and such split stocks do not exceed 1,000 shares, the company may charge a handling fee, except where the stocks were obtained through inheritance.

Article 13 The Company shall not handle any requests for transfers of shares within 60 days prior to the regular shareholders' meeting, 30 days prior to the special shareholders meeting, or 5 days prior to the record date for the distribution of dividends, bonuses or other interests.

Chapter 3 Shareholders’ Meeting

Article 14 Shareholders' meeting of the Company shall be of the following two kinds: regular meeting of shareholders and special meeting of shareholders.
Regular meeting of shareholders shall be convened within 6 months after close of each fiscal year.
Special meeting of shareholders is held when necessary pursuant to the Company Act.
Article 15 Convening of regular and special shareholder's meeting shall notify each registered shareholder 30 and 15 days prior to meeting date respectively.
Article 16 Resolutions at a shareholders' meeting shall, unless otherwise provided for in 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 Except in the circumstances set forth in Item 3, Article 157 of the Company, a shareholder shall have one voting power in respect of each share in his/her/its possession.
The shares shall have no voting power under any of the following circumstances:
The share(s) of a company that are held by the issuing company itself in accordance with the laws;
The shares of a holding company that are held by its subordinate company, where the total number of voting shares or total shares equity held by the holding company in such a subordinate company represents more than one half of the total number of voting shares or the total shares equity of such a subordinate company;
The shares of a holding company and its subordinate company(ies) that are held by another company, where the total number of the shares or total shares equity of that company held by the holding company and its subordinate company(ies) directly or indirectly represents more than one half of the total number of voting shares or the total share equity of such a company.
Article 17-1 The voting power at a shareholders' meeting shall be exercised by way of electronic transmission, and may in writing, provided that the method for exercising the voting power shall be described in the shareholders' meeting notice to be given to the shareholders if the voting power will be exercised in writing or by way of electronic transmission.
- A shareholder who exercises his/her/its voting power at a shareholders meeting in writing or by way of electronic transmission as set forth in the preceding Paragraph shall be deemed to have attended the said shareholders' meeting in person, but shall be deemed to have waived his/her/its voting power in respective of any extemporary motion(s) and/or the amendment(s) to the contents of the original proposal(s) at the said shareholders' meeting.
Article 18 Where a shareholder is unable to do so in person, he or she may appoint a proxy to attend a shareholders' meeting in his/her/its behalf by executing a power of attorney printed by the company stating therein the scope of power authorized to the proxy. When a person who acts as the proxy for two or more shareholders, the number of voting power represented by him/her shall not exceed 3% of the total number of voting shares of the company. Otherwise, the portion of excessive voting power shall not be counted.
Article 19 The chairperson of the Board shall preside the shareholders' meeting unless the Company Act provides otherwise. In case the chairperson of the Board is absent for any cause, the chairperson shall designate one of the directors; in the absence of such a designation, the directors shall elect one from among themselves to preside.
Article 20 Resolutions adopted at a shareholders' meeting shall be recorded in the minutes of the meeting, which shall be affixed with the signature or seal of the chair of the meeting; and shall be distributed to all shareholders of the company within 20 days after the close of the meeting. The preparation and

distribution of the minutes of shareholders' meeting may be effected by means of electronic transmission. The aforesaid distribution of the minutes of shareholders' meeting may be effected by means of public notice. The minutes shall be kept persistently throughout the life of the company; the attendance list bearing the signatures of shareholders present at the meeting and the powers of attorney of the proxies shall be kept by the company for a minimum period of at least 1 year. However, if a lawsuit has been instituted by any shareholder in accordance with the provisions of Article 189 hereof, the minutes of the shareholders' meeting involved shall be kept by the company until the legal proceedings of the foregoing lawsuit have been concluded.

Chapter IV Directors

Article 21 The Company has 7 to 11 directors, of which the Board decides the number of directors to be elected within range, and adopts the candidate nomination system for shareholders' meeting to elect from among the nominees listed in the roster of director candidates pursuant to Article 198 of the Company Act.
In the aforesaid quota of directors, independent directors shall be at least 3, representing one fifth or more of all directors. Regulations governing the professional qualifications, restrictions on shareholdings and concurrent positions held, assessment of independence, method of nomination and selection, and other matters for compliance with respect to independent directors shall follow prescriptions of the securities competent authority.
Article 21-1 The Company already establishes audit committee starting from the 17th Board, including no less than 3 independent directors; among independent directors, 1 is convenor and at least 1 is required to have accounting or financial expertise. Audit committee's exercise of powers, organic regulations, and other matters for compliance shall follow applicable laws or corporate regulations.
Article 22 The total registered shares owned by all directors shall not be less than the minimum percentage of total issued shares specified in the Rules and Review Procedures for Director and Supervisor Share Ownership Ratios at Public Companies.
Article 23 When the number of vacancies equals to one third of the total number of directors, the Board shall call, within 30 days, a special meeting of shareholders to elect succeeding directors to fill the vacancies. A by-elected succeeding director's term of office is not exceeding the remainder of his or her predecessor.
Article 24 The directors form the Board to exercise power and authority and elect a chairperson of the Board from among themselves in accordance with the regulations; in case the chairperson is on leave or absent or cannot exercise his power and authority for any cause, he or she shall designate 1 director to act on his or her behalf. In the absence of such a designation, the directors shall elect from among themselves an acting chairperson.
Article 25 The Board may decide on pledge of property when financing facility is necessary for business operation.
Article 26 The notice of Board meeting may be effected by means of electronic transmission. Unless otherwise provided for in Company Act, resolutions of the Board shall be adopted by a majority of the directors at a meeting attended by a majority of the directors. A director may appoint another director as his/her proxy to attend the Board meetings.

In case a Board meeting is held by video conference, then the directors taking part in such a video conference shall be deemed to have attended the meeting in person.

Article 27 The remuneration of directors shall be determined by a meeting of shareholders. Employees' payroll shall be paid pursuant to ordinary standards regardless of profit and loss status of the Company.

Chapter V Managerial officers

Article 28 The Company may establish managerial personnel whose title, appointment, discharge and remuneration shall follow Article 29 of the Company Act.

Article 29 The general manager of the Company manages daily corporate operations pursuant to the Board

resolutions, supported by vice general president and vice president.

Chapter VI Accounting

Business report
Financial statements
Earnings distribution or accumulated deficit offset proposal
Article 31 In profitable years, the Company shall allocate no less than 1% of profit of the current year as employees' compensation, while allocate no more than 2% as directors' compensation. However, the company's accumulated losses shall have been covered.

Article 31-1 Where the Company has final earnings in a year, except for income tax payable as required, it shall first cover its previous losses, then set aside 10% legal reserve and special reserve as required from the remainder, as well as necessary special reserve or retained earnings according to its judgement; the remaining may be paid as dividends of common shares and bonus according to the total amount of shares.
Article 32 In consideration of economic situation and long-term financial planning, and for the purpose of sustainable and stable development, the Company's dividend policy depends on its judgement based on capital budging for the coming years; need of funds is first financed by means of retained earnings, followed by necessary reserves for business operations, no less than 20% of remaining earnings is distributable as cash dividends, while the remainder is distributable as stock dividends. In case capital expenditure is necessary, the aforesaid surplus earnings may be distributed in full by means of stock dividends.

Chapter VII Supplemental provisions

Article 33 Organic regulations and operational regulations of the Company shall be developed separately.

Article 34 Matters unspecified in these Articles shall follow the Company Act and other relevant laws.

Article 35 Formulated on Jul 5, 1968; 1st amended on July 3, 1969; 2nd amended on Mar 5, 1970; 3rd amended on Mar 31, 1971; 4th amended on Mar 28, 1972; 5th amended on Mar 8, 1973; 6th amended on Mar 21, 1974; 7th amended on Mar 27, 1975; 8th amended on Mar 25, 1976; 9th amended on Jul 20, 1976; 10th amended on Mar 15, 1977; 11th amended on Mar 23, 1978; 12th amended on Mar 21, 1979; 13th amended on Mar 21, 1980; 14th amended on Nov 26, 1980; 15th amended on Mar 27, 1981; 16th amended on Sep 8, 1981; 17th amended on Mar 31, 1982; 18th amended on Mar 31, 1983; 19th amended on Mar 30, 1984; 20th amended on Mar 26, 1985; 21st amended on Mar 27, 1986; 22nd amended on Mar 24, 1987; 23rd amended on Mar 25, 1988; 24th amended on Mar 24, 1989; 25th amended on Mar 23, 1990; 26th amended on Mar 28, 1991; 27th amended on Jun 4, 1991; 28th amended on Mar 28, 1992; 29th amended on Mar 31, 1993; 30th amended on Mar 27, 1995; 31st amended on Mar 27, 1996; 32nd amended on May 8, 1997; 33rd amended on May 14, 1998; 34th amended on Apr 29, 1999; 35th amended on May 9, 2000; 36th amended on May 14,

2002; 37th amended on May 27, 2004; 38th amended on Jun 6, 2006; 39th amended on Jun 13, 2007; 40th amended on Jun 13, 2008; 41st amended on Jun 27, 2012; 42nd amended on Jun 25, 2013; 43rd amended on Jun 24, 2016.

Appendix 13

Chung Hwa Pulp Corporation

Name and Current Shareholding of Directors

Book closure date: April 28, 2018

Position	Name	Name	Date elected	Shareholding while elected	Shareholding while elected	Shareholding while elected	Current shareholding	Current shareholding	Current shareholding
				Type	Shares	ratio	Type	Shares	ratio
Chairman	Kirk Kwang	YFY Inc. Representative	6.24.2016	Common Shares	627,827,989	56.93%	Common Shares	627,827,989	56.93%
Director	Felix Ho
Director	Melody Chiu
Director	Chih-Cheng Huang	Lotus Ecoscings & Engineering Co., Ltd Representative	6.24.2016	Common Shares	117,247	0.01%	Common Shares	117,247	0.01%
Director	Guu-Fong Lin
Director	Ray Chen
Independent Director	Shi-Kuan Chen		6.24.2016	Common Shares	-	-	Common Shares	-	-
Independent Director	Donald Chang		6.24.2016	Common Shares	-	-	Common Shares	-	-
Independent Director	Shih-Lai Lu		6.24.2016	Common Shares	-	-	Common Shares	-	-
Total					627,945,236	56.94%		627,945,236	56.94%

Total issued shares: 1,102,835,316 shares on April 28, 2018

Note: All directors of the company shall hold the shares according to law: 32,000,000 shares As of April 28, 2018, all directors held: 627,945,236 shares

AI assistant

CHP — AGM Information 2018

51933_rns_2018-07-03_0a6ae264-e376-4aa2-8e28-230139534f44.pdf

Chung Hwa Pulp Corporation 2018 ANNUAL GENERAL Shareholders' Meeting

Meeting Handbook

I. Meeting Agenda

II. Items to Report

III. Items to Ratify

IV. Discussion Items

V. Extraordinary Motions

VI. Appendix Appendix 1

2017 Business Report

CHUNG HWA PULP CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

CHUNG HWA PULP CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

CHUNG HWA PULP CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS THE YEARS ENDED DECEMBER 31, 2017 AND 2016 (In Thousands of New Taiwan Dollars)

INDEPENDENT AUDITORS’ REPORT

Opinion

Basis for Opinion

Key Audit Matters

Volume Estimation in Biological Assets

Provision for Receivables

Other Matter

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

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

Notice to Readers

Audit Committee’s Review Report

Chung Hwa Pulp Corporation

2017 EARNINGS DISTRIBUTION STATEMENTS

Chung Hwa Pulp Corporation

Comparison Table of Amended Provisions for the Rules of Board Meetings

Chung Hwa Pulp Corporation Rules of Board Meetings

Chung Hwa Pulp Corporation

Comparison table of Amended Provisions of the Articles of Incorporation

Chung Hwa Pulp Corporation Articles of Incorporation (Revised)

Chapter I General Provisions

Chapter II Shares

Chapter IV Directors

Chung Hwa Pulp Corporation

Assets

Chung Hwa Pulp Corporation

Procedures for Acquisition or Disposal of Assets (Revised)

(Investment limits)

(Application of public announcement)

(Handling Procedures)

before investment:

IV. Signing of contract

Chung Hwa Pulp Corporation

Trading

Chung Hwa Pulp Corporation

Procedures of Engaging for Derivatives Trading (Revised)

I.Purpose

1. Financial unit

2. Accounting unit

5) Check with the financial unit for settlement

Unit: US$

4. Cash flow risk management

XIII. Other matters

Chung Hwa Pulp Corporation

Comparison table of Amended Provisions of the Operational Procedures for Lending Funds to

Others

Chung Hwa Pulp Corporation

Operational Procedures for Lending Funds to Others (Revised)

(3) Security

(4) Ratification

Chung Hwa Pulp Corporation

Rules of Procedure for the Shareholders Meetings

Chung Hwa Pulp Corporation

Articles of Incorporation

Chapter I General Provisions

Chapter II Shares

Chapter IV Directors

Chapter V Managerial officers

Chapter VI Accounting

Chapter VII Supplemental provisions

Chung Hwa Pulp Corporation

Name and Current Shareholding of Directors

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CHP AGM Information 2018

`CHUNG HWA PULP CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME`

`CHUNG HWA PULP CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY`