Stock Code: 6923

2025 Annual Report

中台資源科技股份有限公司

CHUNG TAI RESOURCE TECHNOLOGY CORP.

中台綠能循環經濟

創新研發中心

Chung Tai Ocean Primary & One Air Economy Innovation Center

The name, title, contact phone number and email address of the Company's spokesperson and deputy spokesperson:
Spokesperson: CHANG, CHI-TA
Title: President
Telephone: (02) 2397-5801
Email: [email protected]
Deputy spokesperson's name: Shih, Hsiu-Wei
Title: Chief Finance Officer
Telephone: (02)2397-5801
Email address: [email protected]
Address and telephone number of the headquarters and factory:
Factory address and telephone number:
Chung Tai Plant 1: No. 288, Datan S. Rd., Guanyin Dist., Taoyuan City 328451, Taiwan
Telephone: (03)473-7311
Chung Tai Plant 2: No. 328, Huanke Rd., Guanyin Dist., Taoyuan City 328451, Taiwan
Telephone: (03)473-0068
Chung Tai Plant 3: No. 326, Huanke Rd., Guanyin Dist., Taoyuan City 328451, Taiwan
Telephone: (03)473-0068
Taipei Office Address: 2F., No. 7, Sec. 2, Ren'ai Rd., Zhongzheng Dist., Taipei City 100026, Taiwan (R.O.C.)
Telephone: (02)2397-5801
Stock Transfer Agent:
Name: Stock Affair Department, Yuanta Securities Co., Ltd.
Address: B1, No. 67, Sec. 2, Dunhua S. Rd., Da'an Dist., Taipei City 106646, Taiwan (R.O.C.)
Telephone: (02)2586-5859
Website: http://www.yuanta.com.tw/
Name of the CPAs, Accounting Firm, Address, Website, and Telephone for the Most Recent Annual Financial Report:
Accounting Firm: Deloitte & Touche
CPAs: Chiu, Yung-Ming and Shih, Chin-Chuan
Address: 20F., No. 100, Songren Rd., Xinyi Dist., Taipei City 110421, Taiwan (R.O.C.)
Telephone: (02)2725-9988
Website: https://www2.deloitte.com/tw/tc.html
Name and Trading Venue of Overseas Securities Listed for Trading and Methods to Access Information on Such Overseas Securities: None.
Website of the Company: https://www.chinalab.com.tw/

I. Letter to Shareholders ... 5

II. Corporate Governance Report ... 10
1. Information on Directors, President, Vice Presidents, Assistant Managers, and Heads of Departments and Branches ... 10
2. Corporate Governance Operations ... 21
3. Certified Public Accountant Fee Information ... 61
4. Change of CPA information ... 61
5. The situation where the Company's Chairman, President, or Manager responsible for financial or accounting affairs has, within the past year, served at the certifying accounting firm or its affiliated enterprises. ... 61
6. Changes in Shareholding and Pledge of Shares by Directors, Supervisors, Managerial Officers, and Shareholders Holding More Than 10% of the Company's Shares in the Most Recent Year and as of the Date of the Annual Report ... 61
7. Information on the relationship between the top ten shareholders, whether they are related parties or spouses, relatives within the second degree of kinship ... 63
8. The shareholdings of the Company, its directors, supervisors, managerial officers, and enterprises directly or indirectly controlled by the Company in the same invested enterprises, and the calculation of comprehensive shareholding ratio ... 64

III. Funding Status ... 65
1. Capital and Shares ... 65
2. Status of corporate bonds issuance ... 70
3. Status of preferred stock issuance ... 70
4. Status of overseas depository receipts issuance ... 70
5. Status of employee stock options issuance ... 70
6. Status of restricted employee shares issuance. ... 70
7. Status of new shares issuance for merger or acquisition of other companies: ... 70
8. Status of implementation of capital allocation plans ... 70

IV. Operational Overview ... 73
1. Business Content ... 73
2. Market and Production/Sales Overview ... 97
3. Information on employees in the last two years and up to the printing date of the annual report ... 112
4. Environmental protection expenditure information ... 112

Labor-Management Relations ... 115
Information Security Management ... 119

V. Review and Analysis of Financial Status, Operating Results, and Risk Factors ... 122

Financial Status Comparative Analysis Table ... 122
Financial Performance Comparative Analysis Table ... 123
Cash Flow Comparison Analysis Table ... 125
Impact of Major Capital Expenditures in the Most Recent Year on Financial and Business Operations ... 126
Investment Policy in the Most Recent Year, Main Reasons for Profit or Loss, Improvement Plans, and Investment Plan for the Coming Year ... 126
Risk analysis and assessment for the most recent year up to the printing date of the annual report ... 128

VI. Special Recorded Items ... 134

Affiliated Enterprise Information: The most recent annual Consolidated Business Report of Affiliated Enterprises, Consolidated Financial Statements of Affiliated Enterprises, and Affiliation Report prepared in accordance with the "Regulations Governing the Preparation of Consolidated Business Reports of Affiliated Enterprises, Consolidated Financial Statements of Affiliated Enterprises, and Affiliation Reports" established by this Commission ... 134
For the most recent year and up to the printing date of the annual report, the status of private placement of securities ... 134
Other necessary supplementary information ... 134

VII. Significant Impact Events ... 134

I. Letter to Shareholders

Dear Shareholders:

As global climate action transitions from advocacy to implementation, the year 2025 represents a significant year for Chung Tai in which corporate value continues to deepen and tangible results are demonstrated. In an era of increasingly scarce resources and continuously rising environmental governance standards, the role of enterprises is no longer limited to the expansion of production capacity, but rather to serve as an important driving force for resource circulation and environmental sustainability within the industrial supply chain.

Guided by the management philosophy of "utilizing resources to benefit society," the Company has long been committed to transforming waste into valuable recycled resources. Over the past year, Chung Tai has integrated the technical strengths of its three Class A waste treatment facilities to progressively build an integrated resource circulation system spanning from upstream processing to downstream regeneration, enabling clients' waste to be transformed into reusable green assets. This not only fulfills the Company's commitment to environmental responsibility, but also establishes an important foundation for Chung Tai to continue creating long-term corporate value.

In fiscal year 2025, the Company adopted "SDG 12: Responsible Consumption and Production" as a key guiding principle for its operational development, and while continuing to drive growth in operational scale, also received recognition with the Gold Award at the TSAA Taiwan Sustainability Action Awards. Going forward, Chung Tai will continue to drive innovation through technological advancement and operational excellence, working hand in hand with customers and industry partners to promote the circular economy, thereby creating greater value for environmental sustainability and long-term corporate development.

Operational Results for 2025

The Company's consolidated operating revenue for FY2025 reached NT$1.15 billion, with after-tax net income of approximately NT$280 million and earnings per share of NT$3.03. Although revenue and net income were affected by the peak-cycle fluctuations in environmental engineering, the Company's core waste treatment business continued to demonstrate strong gross margin capability. The overall gross margin for FY2025 improved from 35% in FY2024 to 38%, with an operating net margin of approximately 31%, surpassing the industry average for the environmental and green energy sector. Net cash inflow from operating activities in FY2025 reached NT$418 million, representing a year-on-year growth of 43.15% and approximately 1.5 times the after-tax net income of NT$280 million for the same period, indicating that the decline in revenue did not erode the quality of cash flow.

In terms of revenue structure, incineration treatment and related services accounted for 55%, recycling and processing for 22%, sales of resource-recovered products such as copper powder for 19%, and environmental remediation engineering for 4%, with the most notable achievement being the improvement of Plant No. 1's capacity utilization rate and process efficiency to 65%. Gross margins by segment were 39% for the waste treatment and circular economy business, and 22% for the environmental remediation engineering business.

2. Industry Trends and Development Opportunities for 2026

Looking ahead to 2026, Taiwan's environmental protection industry is poised to benefit from the dual opportunities of the formal introduction of the carbon fee system and the deepened implementation of the Resource Circulation Promotion Act. The government's clearly defined pathway toward net-zero emissions has transformed the demand for carbon reduction and resource recycling from an "optional choice" to a "mandatory requirement" for industries.

Resource Circulation and Extended Producer Responsibility: The management logic shifts from 'end-of-pipe disposal' to 'full lifecycle responsibility'

The Ministry of Environment has initiated amendments to the 'Resource Circulation Dual Acts' (the Resource Recycling Act is proposed to be renamed the Resource Circulation Promotion Act, with concurrent amendments to the Waste Disposal Act). The policy focus is to extend governance from recycling and treatment to the entire process, including product design, reuse, quality of recycled materials, and flow tracking, while strengthening the cross-ministerial coordination framework. For Chung Tai, the future will bring an increase in 'emerging waste streams that can be incorporated into the responsibility chain,' along with a heightened importance of 'compliance, traceability, and quality standards,' which will favor operators with regulatory responsiveness, treatment capabilities, and a credible compliance track record.

Low-Carbon Transition and Resource Circulation Value in the Era of Carbon Pricing

As Taiwan's carbon fee system officially comes into effect and progressively aligns with international carbon pricing mechanisms, the urgency for enterprises to reduce Scope 3 emissions is increasingly pressing. Chung Tai not only serves as a waste treatment service provider but is also committed to becoming a key strategic partner for customers in driving their carbon reduction transformation. The Company continues to optimize the heat recovery power generation system at Plant No. 1, efficiently converting the thermal energy generated during waste treatment into electricity. This not only effectively enhances energy utilization efficiency but also further strengthens the overall value of resource circulation.

Looking ahead, the Company will continue to invest in research and development of low-carbon technologies and resource recovery applications, reducing dependence on virgin resources through circular utilization models while improving energy efficiency and environmental benefits throughout the treatment process. At the same time, by integrating heat recovery power generation with high-efficiency treatment technologies, the Company will assist customers in reducing their carbon footprint throughout the processes of waste resource recovery and energy recovery. In light of the industrial transformation trend driven by the era of carbon pricing, the Company will convert the challenges brought by policy into competitive advantages, continuing to create long-term and sustainable value for shareholders and the environment.

From Capacity Competition to Reliability Competition: The New Threshold in the Incineration Treatment Market

Municipal incinerators remain in a period of renovation and upgrading, but overall treatment capacity has gradually recovered. The competitive focus in the market is also shifting from 'whether treatment capacity is available' to 'who can provide stable, compliant, and low-risk treatment services.' The Ministry of Environment has indicated that the renovation period for municipal incineration facilities is expected to continue until 2031. During this period, the supply-and-demand structure of the general industrial waste treatment market will continue to adjust. In the short term, Chung Tai will manage its incineration lines through lean operations, treating them as high-fixed-cost operating leverage, with a focus on improving utilization rates, reducing unplanned shutdowns, and enhancing feedstock quality management. In the medium term, the Company will further establish 'compliance capability and operational reliability' as key thresholds for customers when selecting partners.

In terms of industry structure, the 'available capacity' of treatment facilities is affected by factors such as renovation progress, equipment aging, and increasingly stringent environmental regulatory standards. On the other hand, the volume of waste generated continues to face long-term upward pressure, lending a degree of resilience to the demand for outsourced treatment services. In recent years, the aging of local incineration facilities, insufficient treatment efficiency, and increasingly stringent pollution control standards have become structural issues of widespread concern in the industry. These challenges have also prompted localities to improve overall operational efficiency through equipment renewal, system upgrades, and operational management optimization, including digitalization and smart technologies.

As a result, when the market assesses processing capacity, it no longer relies solely on nominal design capacity, but places greater emphasis on 'effective capacity' — the capacity that can operate stably over the long term. The level of effective capacity will directly influence price formation and outsourcing allocation in the processing market. Based on official data and media reports, Taiwan's waste treatment sector is moving toward high-value utilization and resource recovery, while overall pressure on waste processing and disposal continues to persist. In an environment where supply and demand remain relatively tight, processing facilities with 'stable intake capacity' are often able to command a market premium; however, whether such a premium can truly translate into operational results still depends on operators' overall competencies in compliance management, processing quality, contractual performance, and cost control of by-product handling.

Future Development Strategies and Business Plans

To ensure long-term competitive advantages and maximize shareholder value, the Company will formally transition in 2026 from the previous 'throughput-oriented' model to a dual-driver framework of 'high value-added services' and 'engineering-based revenue,' with a focus on the following core strategies:

Core Business Transformation: Shifting from 'Capacity Expansion' to 'Unit Value Maximization'

(1) Plant No. 1 (incineration power generation, chemical treatment, solidification treatment, etc.): Implement 'differentiated type-based operations,' adjusting the facility objective from maximizing utilization rates to 'maximizing unit capacity value.' Through a rigorous pricing policy, prioritize the solicitation of high unit-price medical and chemical waste generators. Simultaneously advance the Phase 2 equipment engineering construction at Plant No. 1, laying the foundation for a long-term growth engine beyond 2028.

(2) Plant No. 2 (mercury and spent lamps, precious metal recovery and processing, etc.): Initiate a business transformation, upgrading from traditional 'end disposal' to 'circular material regeneration.' Create niche market growth opportunities for the Company through the research, development, and application of 'waste asbestos resource recycling and reuse technology.'

(3) Plant No. 3 (electronic waste recycling and processing, etc.): Continue to deepen collaboration with international clients, stabilize electronic waste generator sources, and maintain steady gross margin contributions in the resource recycling sector.

Environmental Remediation Engineering: Driving Scale Growth Through 'Lean Management'

Leveraging the Company's practical experience in major pollution remediation projects, the Company will continue to focus on larger-scale, technically demanding public engineering projects, and seek representative contract awards through robust project management capabilities, with the expectation of gradually expanding the contracted scale of large-scale engineering projects in 2026. In addition to enhancing the Company's technical visibility and market position in the environmental engineering sector, such projects can also provide the Company with a more stable source of engineering revenue, strengthening overall operational scale and long-term growth momentum.

In terms of operational management, the Company has established a precise monitoring mechanism for engineering projects, using 'construction progress, acceptance milestones, estimated total cost at completion, and days of collection' as core management indicators. Through lean management, the Company ensures contractual performance quality and cost control, while maintaining the reasonableness of engineering revenue recognition and cash flow stability. By strengthening project management and risk control capabilities, the Company aims to maintain sound profitability quality and capital efficiency while expanding the scale of its engineering business, thereby creating stable and sustainable long-term value for shareholders.

Capital Allocation Optimization: Maintaining a Sound Financial Structure and Shareholder Returns

(1) Structural Optimization: The debt ratio will be strictly controlled below 40%. In 2026, the Company will evaluate increasing the proportion of medium- and long-term borrowings and renegotiate financing terms to enhance operational flexibility of funds.

(2) Capital Discipline: Strengthen internal rate of return assessments for each capital expenditure item to ensure capital is deployed in high-return projects, and maintain a transparent and stable dividend policy as operational scale grows.

Sustainable and Innovative Business Model: Implementing Extended Producer Responsibility (EPR)

In conjunction with the letter of intent for heated tobacco product recycling cooperation signed with an internationally renowned brand, establish a full lifecycle management model for heating devices and tobacco sticks. Invest in research and development to strengthen technology integration, evaluate the recovery of cellulose acetate from tobacco sticks as chemical feedstock, and channel organic matter into biogas power generation to build a complete green energy circular system, thereby converting ESG compliance into tangible non-operating investment returns.

Conclusion

Looking ahead, amid the continuing global trend toward net-zero transition and growing demand for resource circularity, Chung-Tai will continue to deepen its core technological capabilities, strengthen operational resilience, and actively expand circular economy-related businesses in response to changes in the market and policy environment. At the same time, the Company will continue to enhance corporate governance and information transparency, ensuring long-term growth on the foundation of sound operations.

Chung-Tai believes that only by balancing environmental sustainability, corporate development, and social responsibility can true long-term corporate value be created. Going forward, the Company will continue to move ahead hand in hand with shareholders, employees, and partners from all sectors, advancing steadily along the path of resource circularity and green industry development.

In closing, on behalf of the management team, I would like to sincerely thank all shareholders for their long-standing trust and support.

Chung Tai Resource Technology Corp.

Chairman: Cheng, Kuang-Chieh

President: Chang, Chi-Ta

March 27, 2026

II. Corporate Governance Report

1. Information on Directors, President, Vice Presidents, Assistant Managers, and Heads of Departments and Branches

(1) Directors' Information

Names, Education/Experience, Shareholdings, and Nature of Directors

Title	Nationality or Place of Registration	Name	Gender Age	Date of Election (Appointment)	Term of Office	Date of First Appointment	Shares Held at Time of Appointment		Number of Shares Currently Held		Shares Currently Held by Spouse and Minor Children		Shares Held in the Name of Others		Major Experience (Education)	Current Positions Held in the Company and Other Companies	Managers, Directors, or Supervisors Who Are Spouses or Relatives Within the Second Degree of Kinship
							Number of shares	Shareholding ratio	Number of shares	Shareholding ratio	Number of shares	Shareholding ratio	Number of shares	Shareholding ratio			Title	Name	Relationship
Chairman	R.O.C	Cheng, Kuang-Chieh	Male 61~70	2025.6.26	7	2010.6.28	3,412,626	3.71%	3,429,626	3.75%	1,293,104	1.41%	0	0.00%	1. National Taipei University of Technology, Department of Business Management EMBA
2. President of CHINA ELECTRIC MFG. CORP.	1. Director of Chase Sustainability Technology CO., LTD.
2. Chairman of SMOKING ENVIRONMENTALLY FRIENDLY CORPORATION
3. Chairman 3.CHUNG TAI INVESTMENT CO., LTD (Samoa)	Plant Manager	Cheng, Jen-Chang	Second-degree Relative
Director	R.O.C	Chuang, Jui-Yuan	Male 51~60	2025.6.26	5	2016.6.22	0	0.00%	0	0.00%	0	0.00%	0	0.00%	Fu Jen Catholic University, Department of Physics	1. Director and President of JIIN YEEH DING ENTERPRISE CORP.
2. President of GRAND TONE ENTERPRISE COMPANY LIMITED
3. Chairman of YUAN LONG INVESTMENT LTD.
4. Director of YEEH DING CORP.
5. Director of HE RUI INVESTMENT CO., LTD.
6. Director 6.GOLD FINANCE LIMITED
7. Director of SU FONG ENTERPRISE CO., LTD.
8. Chairman of HONG WEI DEVELOPMENT CO., LTD.	-	-	-
Director	R.O.C	CLEANAWAY Co., Ltd.	-	2025.6.26	4	2019.6.10	16,447,000	17.90%	16,447,000	17.98%	0	0.00%	Note 1	Note 1	-	-	-	-	-
	R.O.C	Yang, Yung-Fa	Male 31~40	2025.6.26	4	2017.10.16	12,145,755	13.22%	12,120,755	13.25%	0	0.00%	Note 2	Note 2	1. Master's Degree in Brand Management, European Business School London
2. Ph.D. in Environmental Engineering, National Taiwan University	1. Director and President of Cleanaway Company Limited
2. Chairman of Da Yuan Company Limited
3. Chairman of Chase Sustainability Technology CO., LTD.
4. Chairman of QIAO ZHI YANG Co., Ltd.
5. Chairman and President of Da Zhao Circular Economy Co., Ltd.
6. Director of Top-Comment Resources Company Limited.
7. Director of ER CHENG INVESTMENT HOLDINGS CO., LTD.
8. Chairman and President of Da Cheng Recycling Company Limited
9. Director of Cowin Environmental Resources Limited
10. Director of HAO DA ENTERPRISE CO., LTD.
11. Director and President of Da Chuang Power Co., LTD.
12 Director of WEI HE ENTERPRISE CO., LTD.
13. Director and President of JI DING MATERIALS CO., LTD.
14. Director and President of Cleanaway Company Limited
15. Director and President of DA TSANG INDUSTRIAL COMPANY LIMITED
16. Director and President of JI WEI Co., Ltd.	Director	Chen, Yu-Hsien	Second-degree Relative

Title	Nationality or Place of Registration	Name	Gender Age	Date of Election (Appointment)	Term of Office	Date of First Appointment	Shares Held at Time of Appointment		Number of Shares Currently Held		Shares Currently Held by Spouse and Minor Children		Shares Held in the Name of Others		Major Experience (Education)	Current Positions Held in the Company and Other Companies	Managers, Directors, or Supervisors Who Are Spouses or Relatives Within the Second Degree of Kinship
							Number of shares	Shareholding ratio	Number of shares	Shareholding ratio	Number of shares	Shareholding ratio	Number of shares	Shareholding ratio			Title	Name	Relationship
																17. Director and President of Kang Lien Enterprise Company Limited
18. Director and President of Da Ning Co., Ltd.
19. Director and President of Cleanaway Investment Company Limited
20. Director and President of Da Chuang Green Energy CO., LTD.
21. Chairman and President of Kaohsiung Energy Vault Company Limited
22. Chairman of INNOCHANNEL Technology Company Limited
23. Chairman of Xinyun Co., Ltd.
24. Director of Er Cheng Investment Holdings Co., Ltd.
Director	R.O.C	CLEANAWAY Co., Ltd.	-	2025.6.26	4	2019.6.10	16,447,000	17.90%	16,447,000	17.98%	0	0.00%	Note 1	Note 1	-	-	-	-	-
	R.O.C	Chen, Yu-Hsien	Male 41~50	2025.6.26	4	2019.6.10	0	0.00%	0	0.00%	1,000,000	1.09%	0	0.00%	1. Ph.D. Candidate at Department of Environmental Engineering, National Taiwan University (Currently enrolled)
2. Master's degree from Department of Safety, Health and Environmental Engineering, National Kaohsiung University of Science and Technology
3. Bachelor's Degree, Department of Education and Department of History (Minor), Chinese Culture University	1. Chairman of Cleanaway Investment Company Limited
2. Chairman of Da Chuang Green Energy CO., LTD.
3. Director of Da Zhao Circular Economy Co., Ltd.
4. Director of Da Cheng Recycling Company Limited
5. Director of A KUI SI SPORT CULTURE CO., LTD.
6. Supervisor of HAO DA ENTERPRISE CO., LTD.
7. Supervisor of WEI HE ENTERPRISE CO., LTD.
8. Supervisor of QIAO ZHI YANG Co., Ltd.
9. Supervisor of JI JING Co., Ltd.
10. Chairman of Da Chuang Power Co., LTD.	Director	Yang, Yung-Fa	Second-degree Relative
Director	R.O.C	CLEANAWAY Co., Ltd.	-	2025.6.26	4	2019.6.10	16,447,000	17.90%	16,447,000	17.98%	0	0.00%	Note 1	Note 1	-	-	-	-	-
	R.O.C	Chen, Tsung-Tien	Male 61~70	2025.6.26	4	2019.6.10	0	0.00%	0	0.00%	300,000	0.33%	0	0.00%	1. National Chengchi University, Department of Public Finance
2. Chief Finance Officer of Cleanaway Company Limited	1. Director of Da Yuan Company Limited
2. Director of Cleanaway Zoucheng Holdings Co., Ltd.
3. Chairman of Top-Comment Resources Company Limited.
4. Supervisor of Da Chuang Power Co., LTD.
5. Supervisor of Cowin Environmental Resources Limited
6. Supervisor of Da Zhao Circular Economy Co., Ltd.
7. Supervisor of Da Cheng Recycling Company Limited
8. Supervisor of Da Chuang Green Energy CO., LTD.
9. Supervisor of ER CHENG INVESTMENT HOLDINGS CO., LTD.
10. President of Chase Sustainability Technology CO., LTD.
11. Chief Operation Officer of Cleanaway Company Limited
12. Chief Operation Officer of DA TSANG INDUSTRIAL COMPANY LIMITED
13. Chief Operation Officer of KANG LIEN	-	-	-

Title	Nationality or Place of Registration	Name	Gender Age	Date of Election (Appointment)	Term of Office	Date of First Appointment	Shares Held at Time of Appointment		Number of Shares Currently Held		Shares Currently Held by Spouse and Minor Children		Shares Held in the Name of Others		Major Experience (Education)	Current Positions Held in the Company and Other Companies	Managers, Directors, or Supervisors Who Are Spouses or Relatives Within the Second Degree of Kinship
							Number of shares	Shareholding ratio	Number of shares	Shareholding ratio	Number of shares	Shareholding ratio	Number of shares	Shareholding ratio			Title	Name	Relationship
																BRAMBLES COMPANY LIMITED
14. Chief Operation Officer of Kang Lien Enterprise Company Limited
15. Chief Operation Officer of JI WEI Co., Ltd.
16. Chief Operation Officer of Da Ning Co., Ltd.
17. Chief Operation Officer of Cleanaway Investment Company Limited
18. Director of Kaohsiung Energy Vault Company Limited
19. Chairman of Yunmeng Technology Co., Ltd.
20. Supervisor of Da Zhao Circular Economy Co., Ltd.
Director	R.O.C	Wu, Chun-I	Male 41~50	2025.6.26	2	2023.10.4	1,750,000	1.90%	1,750,000	1.91%	0	0.00%	0	0.00%	York university	1. Supervisor of JUN BAO CONSTRUCTION CO., LTD.
2. Chairman of JUN INVESTMENT INTERNATIONAL CO., LTD.
3. Director of JUNGROUP FASHION BOUTIQUE CO., LTD.
4. Chairman of EDORA PARK CO., LTD.
5. Director of MetaTech (AP) Inc.
6. Director of Locus Cell Co., Ltd.	-	-	-
Independent Director	R.O.C	Fang, Yao-Hua	Male 41~50	2025.6.26	2	2023.10.4	0	0.00%	0	0.00%	0	0.00%	0	0.00%	1. Master's Degree in Innovation and Entrepreneurship Management, National Taiwan University
2. Director of Operations for East Asia and Chief Finance Officer of NI Taiwan Corporation	1. Chairman and President of Universe Circular Technology Co. Ltd.
2. Chairman of YI TAI CAPITAL CO., LTD.
3. Director of Fang and Liu international Corp.
4. Director of JU RUI INTERNATIONAL LTD.
5. Supervisors of Deep Obverse Taiwan INC.
6. Supervisor of Taipei Metro Consulting Service CO., LTD.	-	-	-
Independent Director	R.O.C	Wei, Kuo-Yen	Male 71~80	2025.6.26	2	2022.12.2	0	0.00%	0	0.00%	0	0.00%	0	0.00%	1. Ph.D. in Oceanography, University of Rhode Island, USA
2. Master of Geology, National Taiwan University
3. Administrator of Environmental Protection Administration, Executive Yuan
4. Professor of Department of Geosciences, National Taiwan University	Chair Professor at Feng Chia University	-	-	-
Independent Director	R.O.C	Wang, Yu-Ling	Female 41~50	2025.6.26	2	2022.12.2	0	0.00%	0	0.00%	255,000	0.28%	0	0.00%	1. Master's Degree, Graduate Institute of Law, National Taiwan University
2. Presiding Judge and Judge of the Financial Court, Taiwan New Taipei District Court	1. CEO of Heng-Li Law Firm
2. Independent Director of HEC COMPUCASE Enterprise Co., Ltd.	-

Note 1: CLEANAWAY Co., Ltd. holds 1,064,000 shares (1.16%) of the Company through its subsidiaries Da Ning Co., Ltd. and Ji Wei Co., Ltd.

Note 2: Yang, Yung-Fa holds 270,000 shares (0.29% ownership) of the Company through QIAO ZHI YANG Co., Ltd.

Directors and Supervisors Who Are Institutional Shareholders, and the Major Shareholders of Those Institutions:

(1) Major Shareholders of the Institutional Shareholder March 29, 2026

Name of Institutional Shareholder	Major Shareholders of the Institutional Shareholder	Shareholding Ratio
CLEANAWAY Co., Ltd.	Er-Cheng Co., Ltd.	8.39%
	KANG LAN ENTERPRISE CO., LTD.	4.07%
	Capital Taiwan Select High Dividend ETF Fund Account	2.40%
	QIAO ZHI YANG Co., Ltd.	2.27%
	Yang, Ching-Hsiang	2.23%
	Taipei Fubon Commercial Bank Co., Ltd. in its capacity as Trustee and Custodian of Fuh Hwa Taiwan Technology Dividend ETF Securities Investment Trust Fund Account	2.22%
	Ho.Tsang Co., Ltd.	1.92%
	Chang Wah Electromaterials Inc.	1.11%
	WEI HE ENTERPRISE CO., LTD.	1.07%
	Hao Da Enterprise Co., Ltd.	1.07%

(2) Major Shareholders of the Legal Entities Listed in the Previous Table

March 29, 2026

Legal Entity Name	Major Shareholders of the Legal Entity	Shareholding Ratio
Er-Cheng Co., Ltd.	Yang, Ching-Hsiang	79.720%
	Yang, Li Pi-Lien	20.280%
KANG LAN ENTERPRISE CO., LTD.	Yang, Ching-Hsiang	61.707%
	Yang, Li Pi-Lien	19.902%
	Yang, Shu-Fen	15.659%
	WEI HE ENTERPRISE CO., LTD.	2.146%
QIAO ZHI YANG Co., Ltd.	Yang, Yung-Fa	99.997%
	Yang, Hsiu-Han	0.003%
Ho.Tsang Co., Ltd.	Yang, Li Pi-Lien	97.155%
	Yang, Ching-Hsiang	2.642%
	Yang, Shu-Fen	0.203%
Chang Wah Electromaterials Inc. (Stock Code: 8070)	Wah Lee Industrial Corp.	27.2725%
	Bei Si Jie Investment Co., Ltd.	2.9951%
WEI HE ENTERPRISE CO., LTD.	Yang, Hsiu-Han	99.997%
	Yang, Yu-Ching	0.003%
Hao Da Enterprise Co., Ltd.	Yang, Yu-Ching	99.997%
	Yang, Yung-Fa	0.003%

Disclosure of Information on Professional Knowledge, Diversity, and Independence of Directors

| Diversity
Director Name | Basic Composition | | | | Professional Knowledge and Skills | | | | | | Professional Capabilities and Experience | | | | | | | |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| | Nationality | Gender | Employee Status | Age | Marketing | Finance, Accounting & Taxation | Environmental Engineering | Operations Management | Circular Economy | Innovative Education | Operational Decision-Making and Business Development | Accounting and Financial Analysis | Business Management and Service Research & Development | Risk Management and Crisis Handling | Industry Knowledge | International Market Perspective | Leadership Decision-Making | Environmental Sustainability and Social Participation |
| Cheng, Kuang-Chieh Chairman | R.O.C | Male | None | 61~70 | | | | V | V | V | V | | V | V | V | | V | V |
| Chuang, Jui-Yuan Director | R.O.C | Male | None | 51~60 | | V | | V | V | | | V | V | V | V | | V | |
| Wu, Chun-I Director | R.O.C | Male | None | 41~50 | V | | | V | | | | | V | | | V | V | |
| Yang, Yung-Fa Director | R.O.C | Male | None | 31~40 | | | V | V | V | | V | | V | V | V | V | V | |
| Chen, Yu-Hsien Director | R.O.C | Male | None | 41~50 | | | V | V | V | | | | V | | V | | | V |
| Chen, Tsung-Tien Director | R.O.C | Male | None | 61~70 | V | V | | V | | | V | V | | V | V | | | |
| Fang, Yao-Hua Independent Director | R.O.C | Male | None | 41~50 | | V | | | V | | | V | | V | V | | | V |
| Wei, Kuo-Yen Independent Director | R.O.C | Male | None | 71~80 | | | V | V | V | V | | | | V | V | V | | V |
| Wang, Yu-Ling Independent Director | R.O.C | Female | None | 41~50 | | | | V | | V | V | | V | V | | V | | V |

(1) Considering the current 9 members of the Company's Board of Directors, they collectively possess diverse capabilities and experiences in business judgment and business development, accounting and financial analysis, business management and service research & development, risk management and crisis handling, industry knowledge, international market perspective, leadership decision-making, as well as environmental sustainability and social participation.

(2) All Board members are of domestic nationality; female members account for 11.11%; there are no directors with employee status; the age distribution of members includes 1 member aged 31-40, 4 members aged 41-50, 1 member aged 51-60, 2 member aged 61-70, and 1 member aged 71-80.

(3) The aspects of diversity, complementarity, and implementation of the Board of Directors already include the standards stipulated in Article 20 of the Company's "Corporate Governance Code"; in the future, the diversity policy will still be amended as appropriate based on the operation of the Board of Directors, business model, and development needs, including but not limited to standards in two major aspects: basic conditions and values, and professional knowledge and skills, to ensure that Board members generally possess the knowledge, skills, and literacy necessary to perform their duties.

(4) The achievement status of specific management objectives for the Board of Directors' diversity policy is as follows:

Management Objectives	Achievement Status
The number of directors concurrently serving as the Company's managerial officers should not exceed one-third of the Board seats	Achieved
The Board of Directors should include at least one female director	Achieved
The consecutive term of independent directors should not exceed three terms	Achieved

(5) Independence:

The Company's 3 independent directors (accounting for 33.3% of all Board members) meet the qualification requirements stipulated in the "Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies" issued by the Financial Supervisory Commission, both before and after taking office. The Company's Board of Directors consists of 9 directors, including 3 independent directors, 3 natural person directors, and 3 corporate representative directors. None of the directors concurrently serve as employees of the Company, which demonstrates the high independence of the Board of Directors.

Among the Company's 9 directors, except for YANG, YUNG-FA and CHEN, YU-HSIEN who are relatives by marriage within the second degree of kinship, the remaining directors do not have spousal relationships or relationships within the second degree of kinship, and there are no circumstances stipulated in Paragraphs 3 and 4 of Article 26-3 of the Securities and Exchange Act.

The Company's Board of Directors is committed to continuously evaluating the independence of directors, taking into consideration all relevant factors, including: whether the relevant directors can continue to raise constructive questions to management and other directors, whether the views expressed are independent from management or other directors, and whether their words and actions inside and outside the boardroom are appropriate. The Company's directors, under appropriate circumstances, are able to meet expectations and demonstrate the above qualities.

(2) President, Vice President, Assistant Manager and Information of Department and Branch Heads

March 31, 2025; Unit: Shares; %

Title	Nationality	Name	Gender	Date of Appointment	Shares Held		Shares held by spouse and minor children		Shares Held in the Name of Others		Major Experience (Education)	Current Positions Held at Other Companies	Managerial Officers Who Are Spouses or Within the Second Degree of Kinship			Status of Managerial Officers' Acquisition of Employee Stock Options	Notes
					Number of shares	Shareholding ratio	Number of shares	Shareholding ratio	Number of shares	Shareholding ratio			Title	Name	Relationship
President	R.O.C	Chang, Chi-Ta	Male	2019/5/1	80,000	0.08%	-	-	-	-	Institute of Natural Resources Management, National Taipei University Deputy Executive Director of Taiwan Green Productivity Foundation	None	-	-	-	-	-
Vice President	R.O.C	Li, Shu-Hua	Female	2001/5/9	224,263	0.24%	100,000	0.11%	-	-	Department of International Business, Ming Chuan University Planning Section Manager of CHINA ELECTRIC MFG. CORP.	None	-	-	-	-	-
Chief Plant Manager	R.O.C	Cheng, Jen-Chang	Male	2006/4/13	1,059,107	1.15%	14,068	0.01%	-	-	Department of Business Administration, National Cheng Kung University Section Manager of TYC BROTHER INDUSTRIAL CO, LTD.	None	-	-	-	-	-
Chief Finance Officer	R.O.C	Shih, Hsiu-Wei	Male	2019/3/4	-	-	-	-	-	-	Department of Accounting, National Chengchi University Manager, Audit Department, Deloitte & Touche	None	-	-	-	-	-

(3) Remuneration Paid to Directors, Supervisors, President and Vice Presidents in the Recent Year (2024)

Remuneration of Directors (Including Independent Directors)

December 31, 2025; Unit: NT$ thousand; %

Title	Name	Directors' Remuneration	Total of A, B, C and D, and the Ratio to Net Income After Tax	Remuneration for Concurrent Employment as Employees	Total Amount of A, B, C, D, E, F, and G as a Percentage of Net Income After Tax (%)	Remuneration Received from Invested Companies Other Than Subsidiaries or Parent Company
Compensation (A)	Severance Pay and Pensions (B)	Director's Remuneration (C)	Business Execution Expenses (D)	Salary, Bonuses, and Special Allowances, etc. (E)	Pension/Retirement Benefits (F)	Employee Compensation (G)
The Company	All Companies in the Financial Report	The Company	All Companies in the Financial Report	The Company	All Companies in the Financial Report	The Company
Chairman	Cheng, Kuang-Chieh	11,057	11,057	-	-	2,928
Director	Chuang, Jui-Yuan
Director	Wu, Chun-I
Director	Representative of Cleanaway Company Limited: Yang, Yung-Fa
Director	Representative of Cleanaway Company Limited: Chen, Yu-Hsien
Director	Representative of Cleanaway Company Limited: Chen, Tsung-Tien
Independent Director	Fang, Yao-Hua	1,296	1,296	-	-	-
Independent Director	Wei, Kuo-Yen
Independent Director	Wang, Yu-Ling

Note 1: Please explain the policy, system, standards, and structure for Independent Director compensation, and describe the relationship between the compensation amount and factors such as responsibilities, risks, and time commitment: Independent Director compensation is primarily determined by the Remuneration Committee in accordance with the Company's "Director and Functional Committee Compensation Regulations". Independent Directors who concurrently serve as members of functional committees do not receive compensation for these additional positions.
Note 2: In addition to what is disclosed in the above table, remuneration received by company directors in the most recent year for services provided (such as serving as non-employee consultants to the parent company/all companies in the financial report/invested businesses): None.

Remuneration Range Table

Remuneration Ranges Paid to Each Director of the Company	Director Name
	Total of First Four Items of Remuneration (A+B+C+D)		Total of First Seven Items of Remuneration (A+B+C+D+E+F+G)
	The Company	All Companies in the Financial Report	The Company	All Companies in the Financial Report
Less than NT$1,000,000	Chuang, Jui-Yuan, Wu, Chun-I, Representative of Cleanaway Company Limited: Yang, Yung-Fa, Representative of Cleanaway Company Limited: Chen, Yu-Hsien, Representative of Cleanaway Company Limited: Chen, Tsung-Tien, Fang, Yao-Hua, Wei, Kuo-Yen, Wang, Yu-Ling	Chuang, Jui-Yuan, Wu, Chun-I, Representative of Cleanaway Company Limited: Yang, Yung-Fa, Representative of Cleanaway Company Limited: Chen, Yu-Hsien, Representative of Cleanaway Company Limited: Chen, Tsung-Tien, Fang, Yao-Hua, Wei, Kuo-Yen, Wang, Yu-Ling	Chuang, Jui-Yuan, Wu, Chun-I, Representative of Cleanaway Company Limited: Yang, Yung-Fa, Representative of Cleanaway Company Limited: Chen, Yu-Hsien, Representative of Cleanaway Company Limited: Chen, Tsung-Tien, Fang, Yao-Hua, Wei, Kuo-Yen, Wang, Yu-Ling	Chuang, Jui-Yuan, Wu, Chun-I, Representative of Cleanaway Company Limited: Yang, Yung-Fa, Representative of Cleanaway Company Limited: Chen, Yu-Hsien, Representative of Cleanaway Company Limited: Chen, Tsung-Tien, Fang, Yao-Hua, Wei, Kuo-Yen, Wang, Yu-Ling
NT$1,000,000 (inclusive) ~ NT$2,000,000 (exclusive)	-	-	-	-
NT$2,000,000 (inclusive) ~ NT$3,500,000 (exclusive)	-	-	-	-
NT$3,500,000 (inclusive) ~ NT$5,000,000 (exclusive)	-	-	-	-
NT$5,000,000 (inclusive) ~ NT$10,000,000 (exclusive)	-	-	-	-
NT$10,000,000 (inclusive) ~ NT$15,000,000 (exclusive)	Cheng, Kuang-Chieh	Cheng, Kuang-Chieh	Cheng, Kuang-Chieh	Cheng, Kuang-Chieh
NT$15,000,000 (inclusive) ~ NT$30,000,000 (exclusive)	-	-	-	-
NT$30,000,000 (inclusive) ~ NT$50,000,000 (exclusive)	-	-	-	-
NT$50,000,000 (inclusive) ~ NT$100,000,000 (exclusive)	-	-	-	-
NT$100,000,000 or above	-	-	-	-
Total	Total of 9 people	Total of 9 people	Total of 9 people	Total of 9 people

Remuneration of supervisors: Not applicable.

December 31, 2025; Unit: NT$ thousand

3. Remuneration of President and Vice President

Title	Name	Salary (A)		Severance Pay and Pensions (B)		Bonuses and Allowances (C)		Employee Compensation Amount (D)				Total of A, B, C and D, and the Ratio to Net Income After Tax		Remuneration Received from Invested Companies Other Than Subsidiaries or Parent Company
		The Company	All Companies in the Financial Report	The Company	All Companies in the Financial Report	The Company	All Companies in the Financial Report	The Company		in the Financial Report All Companies		The Company	All Companies in the Financial Report
								Cash Amount	Stock Amount	Cash Amount	Stock Amount
President	Chang, Chi-Ta	4,875	4,875	378	378	4,357	4,357	300	-	300	-	9,910 (3.57%)	9,910 (3.57%)	-
Vice President	Li, Shu-Hua

Remuneration Range Table

Range of Remuneration Paid to Each President and Vice President of the Company	Name of President and Vice Presidents
	The Company	All Companies in the Financial Reports (E)
Less than NT$1,000,000	-	-
NT$1,000,000 (inclusive) ~ NT$2,000,000 (exclusive)	-	-
NT$2,000,000 (inclusive) ~ NT$3,500,000 (exclusive)	-	-
NT$3,500,000 (inclusive) ~ NT$5,000,000 (exclusive)	Li, Shu-Hua	Li, Shu-Hua
NT$5,000,000 (inclusive) ~ NT$10,000,000 (exclusive)	Chang, Chi-Ta	Chang, Chi-Ta
NT$10,000,000 (inclusive) ~ NT$15,000,000 (exclusive)	-	-
NT$15,000,000 (inclusive) ~ NT$30,000,000 (exclusive)	-	-
NT$30,000,000 (inclusive) ~ NT$50,000,000 (exclusive)	-	-
NT$50,000,000 (inclusive) ~ NT$100,000,000 (exclusive)	-	-
NT$100,000,000 or above	-	-
Total	Total of 2 people	Total of 2 people

Names of managerial officers and the distribution of employee compensation:

March 31, 2026; Unit: NT$ thousand

	Title	Name	Stock amount	Cash amount	Total	Ratio of total amount to net income after tax (%)
Managerial Officer:	President	Chang, Chi-Ta	-	600	600	0.22%
	Vice President	Li, Shu-Hua
	Chief Plant Manager	Cheng, Jen-Chang
	Chief Finance Officer	Shih, Hsiu-Wei

(4) Comparative analysis of the ratio of total compensation paid to the Directors, Supervisors, President, and Vice Presidents of the Company and all companies in the consolidated financial statements to net income after tax in the most recent two years, along with an explanation of the compensation policy, standards and combinations, the procedures for determining compensation, and its correlation with operating performance and future risks:

Analysis of the ratio of compensation paid to the Directors, Supervisors, President, and Vice Presidents of the Company to net income after tax in the most recent two years

Unit: NT$ thousand

	The Company		All Companies in the Financial Report
	Total compensation	Ratio to net income after tax	Total compensation	Ratio to net income after tax
2024	30,662	7.49%	30,662	7.49%
2025	25,694	9.24%	25,694	9.24%

The total compensation of the Directors, President and Vice President of the Company and all companies in the financial report as a ratio to net income after tax decreased by 1.75% in 2025 compared to 2024. The Company's compensation over the past 2 years has been distributed within the range of 7%~10% of after-tax profit or loss. Although the scale is affected by the Company's operational performance, the overall structure remains relatively fixed. Adjustments are mainly made considering inflation and project performance to ensure the compensation is reasonable and competitive in the market.

Policies, standards and composition of compensation payment, procedures for determining compensation, and its relationship with operating performance and future risks

The Company's compensation policy includes employee and director compensation stipulated in the Company's Articles of Incorporation, which is approved by the Board of Directors and reported to the shareholders' meeting. The payment methods for Directors and President compensation follow the Company's salary management regulations (including compensation regulations for Directors and functional committees, managerial officers' compensation management regulations, Board performance evaluation regulations, etc.) and reference industry salary levels. Based on performance compensation implementation guidelines, the Company considers overall operational performance, takes into account future operational risks, and references individual performance achievement rates and contributions to provide reasonable compensation.

Relationship between performance evaluation and compensation for Directors and managerial officers:

The proportion of compensation allocated to the Company's Directors and managerial officers follows Article 21 of the Company's Articles of Incorporation, which stipulates that if the Company makes a profit before tax for the year, no less than one percent shall be allocated as employee compensation, to be distributed in the form of stock or cash as resolved by the Board of Directors. The recipients include employees of subsidiaries who meet certain conditions. Of the total employee compensation, no less than fifteen percent shall be allocated to frontline employees. The Company may, from the aforementioned profit, allocate no more than five percent as compensation for Directors by resolution of the Board of Directors.

To regularly evaluate the compensation of Directors and managerial officers, their remuneration is based on their level of participation in the Company's operations and individual performance contributions. The Company assesses ethical risk events involving Directors and managerial officers or other risks that negatively impact the Company's image and reputation, internal management deficiencies, or personnel misconduct. The compensation ratio is calculated after comprehensive consideration of Directors' and managerial officers' target achievement rates, profitability, operational efficiency, and contributions, providing reasonable compensation. The Company also reviews the compensation system for Directors and managerial officers in a timely manner according to actual operational conditions and relevant regulations.

2. Corporate Governance Operations

(1) Board of Directors Operations

The Board of Directors of the Company held a total of 9 meetings in the most recent fiscal year (2025). The attendance of Directors and Independent Directors is as follows:

Title	Name	Actual Attendance (Presence) Count [B]	Number of Proxy Attendance	Actual Attendance (Presence) Rate (%) [B/A]	Notes
Chairman	Cheng, Kuang-Chieh	9	0	100.00	-
Director	Chuang, Jui-Yuan	9	0	100.00	-
Director	Wu, Chun-I	8	0	88.89
Corporate Director	CLEANAWAY Co., Ltd.
Representative: Yang, Yung-Fa	9	0	100.00	-
Corporate Director	CLEANAWAY Co., Ltd.
Representative: Chen, Yu-Hsien	8	0	88.89	-
Corporate Director	CLEANAWAY Co., Ltd.
Representative: Chen, Tsung-Tien	9	0	100.00	-
Independent Director	Fang, Yao-Hua	9	0	100.00
Independent Director	Wei, Kuo-Yen	7	0	77.78
Independent Director	Wang, Yu-Ling	7	0	77.78
Other matters to be recorded:
1. If any of the following circumstances occurs in the operation of the Board of Directors, the date and session of the Board meeting, the content of proposals, the opinions of all Independent Directors, and the company's handling of the Independent Directors' opinions shall be specified:
(1) The matters listed in Article 14-3 of the Securities and Exchange Act: The Company has established an Audit Committee, please refer to the "Operation of the Audit Committee".
(2) Other matters resolved by the Board of Directors, except for the aforementioned matters, which Independent Directors have objected to or expressed reservations about and for which there are records or written statements: None.
2. The implementation of recusal by Directors for proposals with conflicts of interest shall specify the name of the Director, the content of the proposal, the reason for recusal due to conflicts of interest, and the participation in voting:

Board Meeting Date	Director Name	Proposal Content	Reason for Recusal due to Conflicts of Interest	Participation in Voting
2025.03.11	Cheng, Kuang-Chieh, Chuang, Jui-Yuan, Chen, Tsung-Tien, Yang, Yung-Fa, Chen, Yu-Hsien, Wu, Chun-IWu, Chun-I	2024 Individual Compensation Distribution Case for Non-Independent Directors of the Company	Involved in personal remuneration, having a personal interest in this case	Recused from discussion and did not participate in voting
2025.06.26	Wu, Chun-I, Chen, Tsung-Tien, Yang, Yung-Fa, Chen, Yu-Hsien	Proposal to Invest in CLEANAWAY Co., Ltd.	Possible conflict of interest and personal interests due to job-related factors	Recused from discussion and did not participate in voting
2025.10.09	Cheng, Kuang-Chieh	Lending of Funds to SMOKING ENVIRONMENTALLY FRIENDLY CORPORATION	Concurrently serving as Chairman of SMOKING ENVIRONMENTALLY FRIENDLY CORPORATION, as the decision-making involves a conflict of interest,	Recused from discussion and did not participate in voting
2025.12.24	Fang, Yao-Hua, Wei, Kuo-Yen, Wang, Yu-Ling	2026 Independent Director Compensation Case	Involved in personal remuneration, having a personal interest in this case	Recused from discussion and did not participate in voting
2025.12.24	Cheng, Kuang-Chieh	2025 Year-End Bonus Case for Chairman and Managerial Officers	Involved in personal remuneration, having a personal interest in this case	Recused from discussion and did not participate in voting
2025.12.24	Cheng, Kuang-Chieh	2026 Compensation Case for Chairman and Managerial Officers	Involved in personal remuneration, having a personal interest in this case	Recused from discussion and did not participate in voting
2026.03.06	Cheng, Kuang-Chieh, Chuang, Jui-Yuan, Chen, Tsung-Tien, Yang, Yung-Fa, Chen, Yu-Hsien, Wu, Chun-IWu, Chun-I	Distribution of Individual Remuneration for the Company's Non-Independent Directors for the Year 2025	Involved in personal remuneration, having a personal interest in this case	Recused from discussion and did not participate in voting
2026.03.06	Cheng, Kuang-Chieh, Chen, Tsung-Tien, Yang, Yung-Fa, Chen, Yu-Hsien	Waiver of subscription rights for cash capital increase of ordinary shares of investee company Chase Sustainability	Due to personal or family members' shareholding in Chase Sustainability Technology, there is a conflict of interest	Recused from discussion and did not participate in voting

Listed companies should disclose information about the board of directors' self (or peer) evaluation cycle and period, evaluation scope, method, and evaluation content:

The Company has passed the "Performance Evaluation Measures for the Board of Directors and Functional Committees" at the board meeting on September 8, 2022, and implemented the annual performance evaluation of the board of directors in 2025. The evaluation scope, method, and content are as follows:

Evaluation Cycle	Evaluation Period	Evaluation Scope	Evaluation Method	Evaluation Content
Conducted once a year	2025/1/1~2025/12/31	Performance evaluation of the Board of Directors, individual directors, and functional committees (Remuneration and Audit Committees)	Internal self-evaluation of the Board of Directors, self-evaluation of individual directors, self-evaluation of functional committee members	Board of Directors Performance Evaluation: Including level of participation in company operations, quality of board decisions, board composition and structure, director selection and continuing education, internal control.
Individual Director Performance Evaluation: Including understanding of company goals and missions, awareness of director responsibilities, level of participation in company operations, internal relationship management and communication, director's expertise and continuing education, internal control.
Functional Committee Performance Evaluation: Level of participation in company operations, awareness of functional committee responsibilities, quality of functional committee decisions, functional committee composition and member selection, internal control.

Conducted once every three years	2025/1/1~2025/12/31	Board of Directors Performance Evaluation	Conducted by an external professional independent institution — Taiwan Association of Board Governance — using methods such as document review and on-site interviews	An in-depth review of the overall operation of the Board of Directors, individual members, and functional committees was conducted, with key focuses including: 1. Level of Operational Involvement: The degree to which Directors are engaged in the Company's operational strategy, internal controls, and risk management. 2. Quality of Decision-Making: Transparency and effectiveness in meeting agenda arrangements, discussion of relevant issues, and decision-making processes. 3. Succession Planning: The completeness of senior executive successor cultivation and succession plans. 4. Legal Compliance and ESG: Strengthening attention to regulatory compliance, information disclosure, and sustainability issues.

The Company has established the "Board of Directors Performance Evaluation Measures," with the scope of evaluation including the overall Board of Directors, functional committees' performance evaluation, and individual director evaluation. The evaluation methods include internal self-evaluation of the Board or other appropriate methods to conduct performance evaluation. According to these measures, performance evaluations are conducted regularly every year and completed before the end of the first quarter of the following year, to serve as a reference basis for the selection or nomination of directors and committee members.

The evaluation method may be determined based on the key focuses and objectives of the evaluation for the given year, and may be conducted through internal self-evaluation by the Board, self-evaluation by individual Directors, engagement of external professional institutions or experts, or other appropriate means. The Company conducts the Board of Directors performance evaluation through external engagement at least once every three years.

Goals and Implementation Status of Strengthening Board Functions for the Current and Recent Years:

The Company has established the "Board of Directors Meeting Regulations" to effectively establish a board governance system and strengthen its supervisory function. All important proposals are announced on the Market Observation Post System in accordance with the law to achieve full

information disclosure and protect shareholders' rights. In addition, the Company has appointed three Independent Directors, who collectively form the Audit Committee and the Remuneration Committee to implement the spirit of corporate governance. Members of the Board of Directors continue to participate in training courses related to corporate governance themes, enriching their knowledge and enhancing exchanges, in order to continuously improve the functions of the Board of Directors. To encourage continuous education for Directors, the Company regularly arranges corporate governance-related courses for Directors and provides information about courses offered by external training institutions for Directors' reference. The Company continues to maintain "Directors and Officers Liability Insurance" to reduce potential risks that may cause damage to the Company and its shareholders.

The Board of Directors performance self-evaluation for 2025 was completed by the end of January 2026 in accordance with the "Board of Directors and Functional Committees Performance Evaluation Measures." The evaluation scores for the Board of Directors, functional committees' performance, and directors' self-evaluation for 2025 reflect that their overall operations are satisfactory. In addition, the Board of Directors performance evaluation report for 2025 was commissioned to an external professional institution — Taiwan Association of Board Governance — and was completed on December 31, 2025. The evaluation recommendations and the Company's future responses are as follows:

The Company has achieved outstanding results in promoting its sustainability strategy. It is recommended that the Company include the outcomes of its sustainability initiatives in the shareholders' meeting report to highlight the effectiveness of the Company's fulfillment of sustainable operations.
It is recommended that the Company evaluate the establishment of succession plans for key management personnel, and regularly report the implementation results of such plans to the Board of Directors, in order to strengthen the Board's oversight of senior human resources and ensure the sustainable succession of talent pipelines.
The Audit Committee maintains smooth interaction with both internal and external auditors, and the communication details are disclosed in the annual report. It is recommended that, in addition to regular meetings, Independent Directors hold separate communication sessions with the Internal Audit Manager at least twice per year and maintain written records, in order to fulfill the Audit Committee's independent oversight function. The internal and external evaluation results for 2025 were submitted to the 7th Meeting of the 9th Board of Directors on March 6, 2026 for reporting.

(2) Operation of the Audit Committee

In the most recent fiscal year (2025), the Audit Committee held a total of 9 meetings [A], with Independent Directors' attendance as follows:

Title	Name	Number of Actual Attendance [B]	Number of Proxy Attendance	Actual Attendance Rate (%) [B/A]	Notes
Independent Director	Fang, Yao-Hua	9	0	100.00	-
Independent Director	Wang, Yu-Ling	8	0	88.89	-
Independent Director	Wei, Kuo-Yen	7	0	77.78	-
Other matters to be recorded:
1. If any of the following circumstances occur in the operation of the Audit Committee, the date of the Audit Committee meeting, session, proposal content, Independent Directors' objections, reservations or significant recommendations, the resolution results of the Audit Committee, and the company's response to the Audit Committee's opinions shall be specified:
(1) Matters listed in Article 14-5 of the Securities and Exchange Act
Audit Committee Date/Session	Proposal Content		Audit Committee Resolution Results	Company's Response to the Audit Committee's Opinions
The 13th meeting of the 1st term 2025.03.11	1. The Company's 2024 Business Report and Financial Statements
2. The Company's 2024 Earnings Distribution and Cash Distribution from Capital Surplus
3. Proposed amendment to the Company's "Internal Control System - Payroll Cycle"
4. "Statement of Internal Control System" for the year 2024		All attending committee members unanimously approved	All attending directors unanimously approved
The 14th meeting of the 1st term 2025.04.21	Selection of auditors and evaluation of audit quality indicators (AQIs) for auditor independence and competence for the Company's 2025 through first quarter of 2028		All attending committee members unanimously approved	All attending directors unanimously approved
The 15th meeting of the 1st term 2025.05.08	Review of the consolidated financial report for the first quarter of 2025		All attending committee members unanimously approved	All attending directors unanimously approved
The 1st meeting of the 2nd term 2025.06.26	Proposal to Invest in CLEANAWAY Co., Ltd.		All attending committee members unanimously approved	Except for Directors with conflicts of interest who recused themselves from discussion and voting, the remaining attending Directors unanimously approved

| The 2nd meeting of the 2nd term 2025.08.11 | 1. Consolidated financial report for the second quarter of 2025
2. Amendment to the Internal Control System – Administrative Control Operations (addition of management of treasury share buyback operations) and Internal Audit Implementation Guidelines (addition of management audit procedures for treasury share buyback operations) | All attending committee members unanimously approved | All attending directors unanimously approved |
| --- | --- | --- | --- |
| The 3rd meeting of the 2nd term 2025.08.28 | Increase investment in SMOKING ENVIRONMENTALLY FRIENDLY CORPORATION common shares and strategic cooperation case | All attending committee members unanimously approved | All attending directors unanimously approved |
| The 4th meeting of the 2nd term 2025.10.09 | 1. Proposal to lend funds to SMOKING ENVIRONMENTALLY FRIENDLY CORPORATION | All attending committee members unanimously approved | Except for Directors with conflicts of interest who recused themselves from discussion and voting, the remaining attending Directors unanimously approved |
| The 5th meeting of the 2nd term 2025.11.10 | Review of the consolidated financial report for the third quarter of 2025 | All attending committee members unanimously approved | All attending directors unanimously approved |
| The 6th meeting of the 2nd term 2025.12.24 | 1. Report items: Report on the management of significant related-party transactions for fiscal years 2025 to 2026.
2. Establishing the Company's 2026 Internal Audit Plan
3. Proposal to define the scope of applicability of the definition of "entry-level employees" of the Company
4. Proposed amendment to the Company's "Internal Control System - Payroll Cycle | All attending committee members unanimously approved | All attending directors unanimously approved |
| The 7th meeting of the 2nd term 2026.03.06 | 1. 2025 "Statement of Internal Control System"
2. 2025 Business Report and Financial Statements
3. The Company's 2025 Earnings Distribution and Cash Distribution from Capital Surplus
4. Review of internal rotation, independence, competence, and Audit Quality Indicators (AQIs) of the CPA firm engaged to certify the 2026 financial statements
5. Amendment of Certain Articles of the Company's Articles of Incorporation.
6. Proposal for the Company to waive subscription rights to the | All attending committee members unanimously approved | 1.~5.All attending directors unanimously approved
6. Except for Directors with conflicts of interest who recused themselves from discussion and voting, the remaining attending Directors unanimously approved |

	cash capital increase of ordinary shares of its investee company, Chase Sustainability Technology Co., Ltd., and to agree to sign a shareholder agreement
(2) Besides the aforementioned matters, other resolutions that were not approved by the Audit Committee but were approved by more than two-thirds of all directors: None.
2. Implementation of recusal by independent directors from proposals with conflicts of interest; the name of the independent director, the content of the proposal, the reason for recusal due to conflict of interest, and the status of voting participation shall be stated: None.
3. Communication between independent directors and the Internal Audit Manager and CPAs (including significant matters, methods, and results of communication regarding the Company's financial and business status)
1. The Company's Internal Audit Manager regularly provides audit reports to independent directors and, when necessary, may communicate via telephone, mail, or text messages at any time. The Internal Audit Manager also attends Audit Committee meetings to provide recommendations and explanations when committee members require relevant information.
After the Company's Internal Audit Manager has the audit reports and follow-up reports approved, the audit reports and follow-up reports are delivered to each Audit Committee member before the end of the month following the completion of the audit items, and are reported at the quarterly Audit Committee meetings, with smooth communication between both parties. The Company's Internal Audit Manager also maintains smooth communication channels with the CPAs, and in accordance with the regulations of the competent authority, a copy of the next year's audit plan, the implementation status of the previous year's annual audit plan, and the improvement status of internal control deficiencies and abnormal events during the year are sent to the CPAs for reference after the reporting procedure is completed. The most recent private communication between the Company's Internal Audit Manager and Independent Directors took place on March 6, 2026.
2. The Company's CPAs explain financial statement review or audit-related matters to independent directors through written or face-to-face communication. Independent directors may also provide opinions through the same methods and can communicate fully via telephone, mail, or text messages when necessary. During this period, the CPAs have assigned personnel to attend Board meetings to facilitate real-time communication with independent directors. In addition, the CPAs conducted independent communications with the Audit Committee on March 11, 2025 and December 24, 2025, respectively. The communication items included audit planning, audit results, Audit Quality Indicators (AQIs), etc., and management was recused during these processes.

(3) Information on the operations of the supervisors: Not applicable.

(4) The operational status of corporate governance and the differences from and reasons for variance with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies

Evaluation Item	Implementation Status			Differences from the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and Reasons
	Yes	No	Summary Description
1. Has the Company formulated and disclosed corporate governance principles based on the "Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies"?	v		The Company has established Corporate Governance Best Practice Principles with relevant regulations regarding the protection of shareholders' rights, strengthening the functions of the Board of Directors, respecting the rights of stakeholders, and enhancing information transparency.	No significant differences from the Corporate Governance Best Practice Principles.
2. Company Ownership Structure and Shareholders' Rights
(1) Has the Company established internal operating procedures to handle shareholder suggestions, concerns, disputes, and litigation matters, and are these procedures implemented accordingly?	v		The Company has established internal procedures for handling material information and has appointed a spokesperson and deputy spokesperson to handle shareholder suggestions or disputes.	No significant differences from the Corporate Governance Best Practice Principles.
(2) Does the Company maintain awareness of the list of major shareholders who actually control the Company and the ultimate controllers of these major shareholders?	v		The Company accurately tracks the shareholding status of major shareholders, directors, and managers based on the shareholder register provided by the stock affairs agency during book closure periods. In addition, changes in shareholdings of insiders (directors, managers, and shareholders holding more than ten percent of shares) are reported monthly to the Market Observation Post System designated by the competent authority.	No significant differences from the Corporate Governance Best Practice Principles.
(3) Has the Company established and implemented risk control and firewalls between itself and its affiliated enterprises?	v		The Company has established procedures for related party transactions and relevant management regulations, and handles them in accordance with relevant laws and regulations, which can effectively establish risk control.	No significant differences from the Corporate Governance Best Practice Principles.
(4) Has the Company established internal regulations prohibiting insiders from trading securities using undisclosed market information?	v		The Company has established "Procedures for Handling Material Inside Information" and "Code of Ethical Conduct," and has formulated "Procedures for Handling Material Inside Information" in accordance with laws and regulations, which prohibit insiders from trading securities using undisclosed market information. The Company also regularly	No significant differences from the Corporate Governance Best Practice Principles.

Evaluation Item	Implementation Status			Differences from the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and Reasons
	Yes	No	Summary Description
			educates insiders about the Securities and Exchange Act and related regulations concerning insider trading requirements. In addition, in accordance with Article 10, Paragraph 4 of the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies and the insider trading prohibition provisions under Article 157-1 of the Securities Exchange Act, the Company regularly reminds Board members, Managerial Officers, insiders, and their close relatives that trading in the Company's shares is prohibited during a specified period prior to the announcement of financial reports.
3. Composition and Responsibilities of the Board of Directors
(1) Has the Board of Directors formulated a diversity policy for its composition, specific management objectives, and implemented them?	v		Please refer to the annual report [Chapter 2, 1, (1), 3. Disclosure of Directors' Professional Knowledge, Diversity, and Independence] for information on the Company's Board of Directors diversity policy and its implementation.	No significant differences from the Corporate Governance Best Practice Principles.
(2) In addition to the statutorily required Remuneration Committee and Audit Committee, has the Company voluntarily established other types of functional committees?	v		The Company has established the Audit Committee and Remuneration Committee as required by regulations, with the Company's independent directors serving as committee members. For information on the operations of the Audit Committee and Remuneration Committee, please refer to the annual report [Chapter 2, 2, (2)] and [Chapter 2, 2, (5)]. In addition, the Company has also established a Sustainability Committee. In the future, other functional committees will be established as required by law or practical needs.	No significant differences from the Corporate Governance Best Practice Principles.
(3) Has the Company established a performance evaluation procedure for the Board of Directors and evaluation methods, conducted performance evaluations regularly each year, submitted the	v		To implement corporate governance and enhance the functions of the Company's Board of Directors, the Company conducts annual performance evaluations at the end of each year in accordance with the Board of Directors' performance evaluation measures and procedures approved by the Board. The evaluation results, along with directors' self-assessments, serve as reference for nominating directors and determining their remuneration.	No significant differences from the Corporate Governance Best Practice Principles.

Evaluation Item	Implementation Status			Differences from the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and Reasons
	Yes	No	Summary Description
evaluation results to the Board of Directors, and used them as reference for individual directors' remuneration and nomination for reappointment?
(4) Does the Company regularly assess the independence of its certified public accountants?	v		The Company regularly evaluates the independence and suitability of its certified public accountants each year with reference to the independence requirements in Article 47 of the Certified Public Accountant Act and Statement of Professional Ethics No. 10. The certified public accountants also provide declarations of independence. The evaluations for 2025 and 2026 were submitted to the Board of Directors and approved on May 8, 2025 and March 6, 2026, respectively.	No significant differences from the Corporate Governance Best Practice Principles.
4. Has the listed company assigned competent personnel in appropriate numbers to be in charge of corporate governance affairs, and designated a corporate governance officer to be responsible for corporate governance matters (including but not limited to providing directors and supervisors with the information needed for performing their duties, assisting directors and supervisors in complying with laws and regulations, handling matters related to board meetings and shareholders' meetings in accordance with the law, handling company registration and changes in registration,	v		The Company's Board of Directors passed a resolution on November 15, 2023, appointing Chief Finance Officer Shih, Hsiu-Wei to concurrently serve as the Corporate Governance Officer, responsible for corporate governance matters. His main responsibilities include handling matters related to board meetings and shareholders' meetings in accordance with the law, producing minutes of board meetings and shareholders' meetings, assisting directors with their appointments and continuing education, providing directors with the information needed for performing their duties, and assisting directors in complying with laws and regulations.	No significant differences from the Corporate Governance Best Practice Principles.

Evaluation Item	Implementation Status			Differences from the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and Reasons
	Yes	No	Summary Description
and producing minutes of board meetings and shareholders' meetings)?
5. Has the company established channels for communicating with stakeholders (including but not limited to shareholders, employees, customers, and suppliers), set up a stakeholder section on the company website, and appropriately responded to important corporate social responsibility issues of concern to stakeholders?	v		The Company has established a corporate governance section on its website (https://www.chinalab.com.tw/) and provided contact information for various positions, offering channels for stakeholders to contact the Company.	No significant differences from the Corporate Governance Best Practice Principles.
6. Has the company appointed a professional shareholder services agent to handle matters relating to shareholders' meetings?	v		The Company has appointed Stock Affair Department, Yuanta Securities Co., Ltd. to handle stock affairs and matters related to shareholders' meetings.	No significant differences from the Corporate Governance Best Practice Principles.
7. Information Disclosure
(1) Has the company established a website to disclose information regarding its financial status, business operations, and corporate governance?	v		The Company has established a website (https://www.chinalab.com.tw/) to disclose information regarding its financial status, business operations, and corporate governance.	No significant differences from the Corporate Governance Best Practice Principles.
(2) Has the company adopted other means of information disclosure (such as establishing an English website, designating personnel responsible for the collection and disclosure of	v		The Company has designated personnel responsible for the collection and disclosure of company information, and has implemented a spokesperson and deputy spokesperson system as required. Institutional investor conference presentations for each period are also promptly updated on the Market Observation Post System or the company's official YouTube channel for investors' reference.	No significant differences from the Corporate Governance Best Practice Principles.

Evaluation Item	Implementation Status			Differences from the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and Reasons
	Yes	No	Summary Description
company information, implementing a spokesperson system, posting institutional investor conference proceedings on the company website, etc.)?
(3) Has the company announced and filed its annual financial reports within two months after the end of the fiscal year, and announced and filed its first, second, and third quarter financial reports and monthly operating results before the required deadlines?		v	Although the Company has not announced and filed its financial reports within two months after the end of the fiscal year, it has announced and filed its quarterly financial reports and monthly operating results within the required deadlines.	No significant differences from the Corporate Governance Best Practice Principles.
8. Does the company have other important information that helps to understand the operation of corporate governance (including but not limited to employee rights, employee care, investor relations, supplier relations, rights of stakeholders, continuing education of directors and supervisors, implementation of risk management policies and risk measurement standards, implementation of customer policies, and purchase of liability insurance for directors and supervisors by the company, etc.)?	v		1. Employee rights: The Company values employee compensation and benefits, providing salary levels, leave systems, and retirement insurance that exceed legal requirements. Please refer to the explanation in [IV. 5. Labor Relations] of this annual report.
2. Employee care: The Company values employees' physical and mental balance, and has established an Employee Welfare Committee that organizes various recreational and cultural activities and promotes club activities, enabling employees to maintain a balance between health and life outside of work. To enhance employee health awareness, regular health examinations are conducted annually and health consultation services are provided to employees. Additionally, to ensure the well-being of female employees, the Company implements maternity leave allowances with job retention in accordance with local labor regulations, strengthens rights related to pregnancy care leave and family care leave. For pregnant female employees, health risk assessments are implemented and work	No significant differences from the Corporate Governance Best Practice Principles.

Evaluation Item	Implementation Status
	Yes	No	Summary Description
			adjustments are made as needed, creating a female-friendly work environment based on the principles of maternal protection and employment equality.
3. Investor relations, supplier and stakeholder rights: The Company has established diverse and smooth communication channels based on stakeholder attributes. For example, a stakeholder section has been set up on the company website to communicate and provide feedback on stakeholders' needs and expectations.
A. Employees: Communication channels have been established such as periodic employee care, health supervision, labor-management meetings, and employee welfare committee meetings.
B. Shareholders/Investors: The Company treats all shareholders based on principles of fairness and transparency. In addition to convening annual shareholders' meetings in accordance with the Company Act and relevant regulations, the Company encourages shareholders to actively participate in making proposals and asking questions at shareholders' meetings. The Company also holds two investor conferences annually.
C. Customers: Dedicated sales and customer service units respond promptly to customer needs, establishing a customer complaint feedback system to check the progress of issue resolution in real time; on-site customer audits and questionnaire responses; establishing quality management and customer satisfaction surveys.
D. Suppliers: Established procurement and supplier management interaction channels along with dedicated procurement and supplier management departments, holding periodic exchange meetings with suppliers, and providing an anti-corruption reporting mailbox.
E. Society (Communities, Media, Non-profit Organizations): Appointed dedicated spokespersons and deputy

Evaluation Item	Implementation Status
	Yes	No	Summary Description
			spokespersons to respond appropriately, periodically releasing press releases and statements, and holding press conferences, etc. Participate in seminars organized by non-governmental organizations to stay abreast of industry trends, which serves as a reference for policy planning, and collaborate with non-governmental organizations to implement projects supporting disadvantaged groups and promoting environmental awareness to strengthen two-way communication.
4. Director's Continuing Education: The Company's directors possess both professional backgrounds and practical experience. The Company arranges corporate governance continuing education courses for directors each year. For the directors' continuing education in the most recent year, please refer to Section [II, 2, (9), 1, "Directors' Continuing Education"] of this annual report.
5. Implementation of Risk Management Policies and Risk Measurement Standards: Various internal regulations have been established in accordance with the law to conduct risk management and assessment.
6. Implementation of Customer Policies: The Company places great importance on customer information confidentiality and privacy, and is committed to establishing information networks covering aspects such as facility setup, procurement, production, and sales. By comprehensively collecting intelligence and other means to optimize customer service, the Company deepens product competitiveness and customer dependency, achieving customer satisfaction. In addition, customer satisfaction analysis surveys are conducted to understand and meet customer needs. For customer feedback and opinions, regular reviews are conducted and appropriate improvement plans are proposed to continuously enhance the highest quality products and services.
7. Status of liability insurance purchased by the Company for its Directors: The Company

Evaluation Item	Implementation Status
	Yes	No	Summary Description
			has purchased liability insurance for its Directors for the past three consecutive years through Cathay Century Insurance. In order to implement the corporate governance system, the most recent insurance coverage amount was increased from the original NT$30 million to NT$42 million, covering the period from February 9, 2026 to February 9, 2027.
8. Please explain the improvements made based on the corporate governance evaluation results published by the Corporate Governance Center, TWSE in the most recent year, and propose priority items and measures for areas that have not yet been improved: Not applicable.

(5) Composition, Responsibilities, and Operation of the Remuneration Committee:

Information on the Operation of the Remuneration Committee

(1) The Remuneration Committee members are composed of the Company's three independent directors. For their years of service, professional qualifications, experience, and independence status, please refer to [Part II, 1, (1), 1. Directors' Names and Education/Experience, and 3. Disclosure of Directors' Professional Knowledge, Diversity, and Independence Information] in this annual report.

(2) The Company's Remuneration Committee consists of 3 members.

(3) During the most recent fiscal year (2025), the Remuneration Committee held 2 meetings [A]. The qualifications and attendance of the committee members are as follows:

Title	Name	Number of Actual Attendance [B]	Actual Attendance Rate (%) [B/A]
Independent Director Convener	Wei, Kuo-Yen	1	50.00
Independent Director Committee Member	Wang, Yu-Ling	2	100.00
Independent Director Committee Member	Fang, Yao-Hua	2	100.00

Other matters to be recorded:

Meeting information of the Directors' Remuneration Committee:

Remuneration Committee Meeting Date/Session	Proposal Content	Resolution Results
2025/3/11 The 9th meeting of the 1st term	1. Distribution of Employee and Director Compensation for the Company for the Year 2024
2. Distribution of Individual Compensation for Non-Independent Directors of the Company for the Year 2024	Approved by all attending committee members with the consent of the chairperson.	Submitted to the Board of Directors and approved by the resolution of other attending directors excluding directors who recused themselves due to conflicts of interest
2025/12/24 The 1st meeting of the 2nd term	1. Review of the Year-end Bonus for the Chairman and Managerial Officers for the Year 2025
2. Review of the Compensation for the Chairman and Managerial Officers for the Year 2026
3. Review of the Compensation for Independent Director Wei, Kuo-Yen for the Year 2026
4. Review of the Compensation for Independent Director Wang, Yu-Ling for the Year 2026
5. Review of the Compensation for Independent Director Fang, Yao-Hua for the Year 2026	Approved by all attending committee members with the consent of the chairperson.	Submitted to the Board of Directors and approved by the resolution of other attending directors excluding directors who recused themselves due to conflicts of interest
2026/3/6 The 2nd meeting of the 2nd term	1. Distribution of Employee and Director Compensation for the Company for the Year 2025
2. Distribution of Individual Compensation for Non-Independent Directors of the Company for the Year 2025	Approved by all attending committee members with the consent of the chairperson.	Submitted to the Board of Directors and approved by the resolution of other attending directors excluding directors who recused themselves due to conflicts of interest

If the Board of Directors does not adopt or modifies the recommendations of the Remuneration Committee, the date and term of the Board meeting, the content of the proposal, the resolution results of the Board, and the Company's handling of the Remuneration Committee's opinions should be specified (if the remuneration approved by the Board is better than the recommendation of the Remuneration Committee, the differences and reasons should be specified): No such situation occurred.
Regarding the resolutions of the Remuneration Committee, if members have objections or reservations with records or written statements, the date and term of the Remuneration Committee meeting, the content of the proposal, the opinions of all members, and the handling of these opinions should be specified: No such situation occurred.
Information and Operation of the Nomination Committee Members: The Company has not yet established a Nomination Committee.

(6) Status of Promoting Sustainable Development and Differences from and Reasons for Deviation from the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies

Initiatives	Implementation Status			Differences from and Reasons for Deviation from the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies
	Yes	No	Summary Description
1. Has the company established a governance structure to promote sustainable development, set up a dedicated (or part-time) unit to promote sustainable development, authorized senior management to handle it, and does the Board of Directors supervise the implementation?	v		The Company has established the "Corporate Social Responsibility Practice Principles," which was approved by the Board of Directors' resolution on September 16, 2022, and reported at the extraordinary shareholders' meeting on December 2, 2022. The Company approved the establishment of the "Sustainable Development Committee Charter" at the Board of Directors meeting on April 12, 2024, and on July 18, 2024, nominated and appointed members to the Sustainable Development Committee in accordance with the aforementioned charter to achieve the Company's sustainable development goals. The committee convener is the Company's Independent Director Fang, Yao-Hua, and the Company's President Chang, Chi-Ta serves concurrently as the Chief Sustainability Officer. Four subgroups have been established: "Corporate Governance," "Sustainable Environment," "Social Welfare," and "Sustainability Information Disclosure." Cross-departmental subgroups execute operations, compile implementation plans or other sustainability-related matters, which are consolidated by the Sustainable Development Committee and regularly reported to the Board of Directors on implementation results. The most recent Sustainability Report approved by the Board of Directors is the 2024 Sustainability Report, which was approved on August 12, 2025. The 2025 Sustainability Report is currently being prepared and is expected to be submitted to the Board of Directors for approval in the second half of 2026. In addition, the Company's 2025 sustainability promotion results and the 2026 sustainable development plans and strategies were discussed by the Sustainability Development Committee on December 24, 2025, and reported to the Board of Directors for oversight on the same day.	No significant difference.
2. Does the company conduct risk assessments on environmental, social, and corporate governance issues related to company operations in accordance with the	v		The scope of sustainability development promotion is consistent with the entities included in Chung Tai Resource Technology's consolidated financial statements. In accordance with the materiality principle, assessments are conducted to ensure that environmental, social, and corporate governance (ESG) issues related to company operations are adequately identified and managed. This involves collecting ESG issues relevant to the company, then analyzing the	No significant difference.

Initiatives	Implementation Status			Differences from and Reasons for Deviation from the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies
	Yes	No	Summary Description
materiality principle, and establish relevant risk management policies or strategies?			impact of each issue through four identification factors (degree of impact, scope of impact, reversibility, and probability of occurrence), and ranking them according to the magnitude of impact. The company conducts evaluations every 2-3 years to maintain sensitivity to risks and adjust strategies, allowing the company to establish appropriate risk management policies or strategies to effectively respond to and manage risks arising from important issues.
Through the material topic identification process and discussions by the "Sustainability Development Committee," the Company has compiled 26 sustainability-related issues and identified 6 material topics, which are, in order: "Air Quality," "Waste," "Employee Hiring and Retention," "Energy," "Water Use and Wastewater Discharge," "Labor-Management Communication"; In addition, considering the Company's operations and sustainability development strategic guidelines, "Greenhouse Gas Emissions" and "Occupational Safety and Health" were also included as material topics following discussions and resolutions approved by senior management.
3. Environmental issues
(1) Has the company established an appropriate environmental management system based on its industry characteristics?	v		The Company follows occupational safety, health, and environmental protection related regulations to actively implement occupational safety and health management systems and environmental management systems. The Company has passed the BSI certification audit and obtained the ISO 14001:2015 Environmental Management System certificate, covering Chung Tai Plant 1, Plant 2, and Plant 3, with a validity period from June 10, 2025 to June 9, 2028. The Company will continue to be committed to environmentally sustainable operations and system improvement.	No significant difference.
(2) Is the company dedicated to improving energy efficiency and using renewable materials with low environmental impact?	v		The Company has developed its own waste light source recycling and treatment equipment, which can recycle and reuse more than 95% of the derived materials. The recovered mercury can achieve a high recovery rate and high purity level, with technology leading the world. Using dry/wet crushing and water shaking table separation to produce high-purity copper powder and concrete admixture products, achieving the goal of full-cycle recycling with zero waste.
The Company promotes waste resource utilization and energy recovery, with the waste-to-energy facility at Plant One being an important practice to enhance energy recovery and reduce environmental impact. Recycled waste heat is converted into steam for power generation, supplying electricity for in-plant processes with excess	No significant difference.

Initiatives	Implementation Status
	Yes	No	Summary Description
			power sold to Taiwan Power Company.
The Company has passed the BSI certification audit and obtained the ISO 50001:2018 Energy Management System certificate, covering Chung Tai Plant 1, with a validity period from December 6, 2025 to December 5, 2028.
(3) Has the company assessed the potential risks and opportunities of climate change to the business now and in the future, and taken measures to address climate-related issues?	v		The Company refers to the international standard TCFD (Task Force on Climate-related Financial Disclosures) framework to identify and manage challenges and opportunities brought by climate change, and formulates relevant strategies to address these climate-related issues. This method helps enhance the company’s resilience and sustainability.
The Company refers to domestic and international technical reports, local regulatory standards, disclosure documents from peers both domestically and internationally, and convenes relevant departments while consulting external expert advisors. Risks and opportunities are scored based on "impact/benefit level" and "probability of occurrence." Based on these scores, risk and opportunity matrix diagrams are created to confirm the impact level and materiality of each item. Based on the above analysis results, the Company has identified relevant climate-related risks and opportunities, namely general environmental regulations, carbon tax, low-carbon technology transition, extreme weather events, participation in renewable energy projects and adoption of energy-saving measures, as well as development and/or expansion of low-carbon products and services, and discloses their actual and potential impacts on the organization.	No significant difference.
(4) Has the company compiled statistics on greenhouse gas emissions, water consumption, and total waste weight for the past two years, and formulated policies for energy conservation, carbon reduction, greenhouse gas reduction, water conservation, or other waste	v		Global warming and climate change have become important sustainability issues. The Company conducts greenhouse gas inventory operations to quantify and compile statistics on organizational greenhouse gas emissions. This systematic approach quantifies greenhouse gas emissions generated during production activities across three factory sites to evaluate reduction potential, promote carbon reduction control measures, improve equipment, and update and upgrade environmental protection equipment. These efforts aim to enhance energy efficiency and reduce greenhouse gas emissions.
Following the "Guidelines for Greenhouse Gas Emissions Inventory and Registration" issued by the Ministry of Environment, the Company’s self-inventory for 2025 shows direct greenhouse gas emissions (Scope 1) of 66,459.4 metric tons CO_{2}e/year, indirect greenhouse gas emissions (Scope 2) of 3,339.7 metric tons CO_{2}e/year, with total emissions of 69,799.1 metric tons CO_{2}e/year.	No significant difference.

Initiatives	Implementation Status			Differences from and Reasons for Deviation from the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies
	Yes	No	Summary Description
management?			The energy emission intensity for 2025 is 1.53 (metric tons CO_{2}e/metric ton). The primary source of the Company's greenhouse gas emissions is Scope 1. The Company will continue to introduce energy management systems to enhance energy use efficiency and emissions management, with the goal of gradually reducing emission intensity.
In 2025, water consumption was 109.285 million liters, with water consumption intensity of 0.0024 (million liters/metric ton) for processing each metric ton of waste. To reduce the impact of water shortages on plant operations, the Company carefully manages and recycles the water resources used for various activities across all plant areas. The Company has established wastewater treatment facilities and management measures in accordance with environmental protection regulations and to implement pollution prevention and source reduction principles. The Company's three plants use tap water, industrial water, and recycled rainwater as water sources for process water, domestic water, cooling water systems, and other uses (such as fire protection, landscape irrigation, etc.). Some of the recycled water can be reused in circulation, while wastewater is discharged through pipelines to the industrial park's wastewater treatment plant for processing.
In 2025, the total derived waste output was 12,390.7 metric tons, of which 30% was self-reused, 3% was outsourced for reuse, 5% was self-incinerated, 13% was self-solidified, 1.0% was outsourced for physical treatment, and 48% was outsourced for landfill disposal. Derived waste removal and treatment are all contracted to qualified removal and treatment institutions, with third-party verification of receipt conducted once a year. The above 2025 emission data and related statistics are still being inventoried and verified. Detailed information and subsequent correction results will be disclosed in the 2025 Sustainability Report.
4. Social Issues
(1) Has the company established relevant management policies and procedures in accordance with relevant regulations and international human rights	v		The Company has established relevant employee guidelines in accordance with national regulations such as the Labor Standards Act, Employment Service Act, and Gender Equality in Employment Act to protect employees' rights. The Company also establishes a corporate culture of equal opportunity based on international labor standards and local labor laws.	No significant difference.

Initiatives	Implementation Status			Differences from and Reasons for Deviation from the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies
	Yes	No	Summary Description
conventions?
(2) Has the company established and implemented reasonable employee welfare measures (including compensation, leave, and other benefits), and appropriately reflected business performance and results in employee compensation?	v		The Company provides employees with leave arrangements that balance work and life, holiday bonuses, group insurance, and also plans competitive salary levels in the market. In addition to considering the external competitiveness and internal fairness of compensation and benefits, the Company also takes into account its financial and operational status, industry annual salary adjustment strategies, and individual work performance to comprehensively plan and implement annual salary adjustments, as well as design and distribute incentive bonuses to motivate and retain outstanding talent. Please refer to the explanation in [IV. 5. Labor Relations] of this annual report.	No significant difference.
(3) Does the company provide employees with a safe and healthy work environment, and regularly implement safety and health education for employees?	v		The Company has dedicated safety and health management personnel responsible for formulating occupational safety and health management plans, promoting workplace environment and operational safety identification, assessment, and control, as well as various safety and health management matters. The Company has established an Occupational Safety and Health Committee in accordance with the law, which holds regular quarterly meetings to discuss occupational safety and health issues. Employees can also participate in discussions on occupational safety and health issues through labor representatives, allowing occupational safety and health policies to be implemented in a way that most closely meets the needs of on-site colleagues, in order to achieve the goal of safety and health for all employees. The Company’s three Class A waste treatment facilities have passed ISO 45001:2018 certification and are regularly audited and verified by an external third-party impartial body (BSI), with the latest validity period from September 5, 2023 to September 4, 2026. We will uphold the spirit of continuous improvement in occupational safety and health management systems, actively create a safe, healthy, comfortable, and friendly work environment, with “zero accidents” as our goal. In addition, all new and current employees of the Company must regularly undergo occupational safety and health education and training.	No significant difference.
(4) Has the company established an effective career	v		With “Benefiting Lives” as the main axis, we have incorporated “cognitive education” thinking to plan a sound certification development framework. Using	No significant difference.

Initiatives	Implementation Status			Differences from and Reasons for Deviation from the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies
	Yes	No	Summary Description
development and training program for employees?			professional competency and management competency certifications as the foundation, we vertically promote related courses and horizontally extend training to various departments. We also align with the company's operational strategy by providing internal and external training channels to enhance colleagues' professional knowledge and skills, thereby achieving the company's goals and organizational needs through diverse educational training pathways. Additionally, we offer digital transformation series courses based on learning blueprints for different audiences. Through collaboration with academic institutions, we provide diverse learning courses both online and in-person, with the aim of developing intelligent thinking among personnel and continuously strengthening the overall competitiveness of our staff and organization.
(5) Does the company comply with relevant regulations and international standards regarding customer health and safety, customer privacy, marketing and labeling issues related to products and services, and has it established relevant policies and grievance procedures to protect consumer or customer rights?	v		The Company has established a customer-oriented operational philosophy. Through telephone, E-Mail, and face-to-face meetings, we thoroughly understand customer needs, develop improvement strategies, and promptly respond to customers. The Company has also established customer service-related implementation procedures to ensure that customers' various needs receive appropriate responses.	No significant difference.
(6) Has the company established supplier management policies requiring suppliers to comply with relevant regulations on environmental protection,	v		The Company has established a Supplier Code of Conduct declaration, requiring suppliers to ensure their business practices in areas such as labor, health and safety, environment, business ethics, and management systems comply with this code, and to fully adhere to the laws and regulations of the countries/regions where they operate. At the same time, the Company conducts regular audits, and the audit results are also one of the important factors in the company's decision-making.	No significant difference.

Initiatives	Implementation Status			Differences from and Reasons for Deviation from the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies
	Yes	No	Summary Description
occupational safety and health, or labor rights, and what is the implementation status?
5. Has the company prepared sustainability reports or other reports disclosing non-financial information with reference to internationally accepted reporting standards or guidelines? Has the aforementioned report obtained assurance or verification opinion from a third-party verification unit?	v		The Company's Sustainability Report, with the first edition (for years 2019, 2020, and 2021) and the second edition (for years 2022 and 2023) being published every two years, will be prepared annually starting from the third edition (2024). The framework adopts the GRI 2021 Standards established by the Global Sustainability Standards Board (GSSB) and references the Sustainability Accounting Standards Board (SASB) standards to enhance information disclosure across environmental, social (human rights), and corporate governance (economic) dimensions. The third edition (for years 2022 and 2023) of the Sustainability Report was approved by the Board of Directors on August 12, 2025, and has received Type 1 certification under the AA1000 Assurance Standard v3 from the British Standards Institution (BSI), a third-party verification organization. The fourth edition (2025) of the Sustainability Report is currently being prepared and is expected to be approved by the Board of Directors in the second half of 2026.	No significant difference.
6. If the company has established its own sustainability development principles in accordance with the "Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies," please describe any differences between its operations and the established principles:
7. The Company has established the "Sustainable Development Best Practice Principles" in accordance with the "Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies." Information about its sustainability activities is disclosed on the Company's website and the Market Observation Post System. All employees and affiliated enterprises are required to comply with these principles. There are no significant differences between the Company's practices and the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies.
8. Other important information to help understand the implementation of sustainable development: The Company has established a "Corporate Sustainability Section" on its website to disclose relevant information. Website address: https://www.chinalab.com.tw/.

(7) Climate-related Information for Listed Companies

Implementation Status of Climate-related Information

Items	Implementation Status
1. Describe the supervision and governance of climate-related risks and opportunities by the board of directors and management.	Starting in 2025, the Board of Directors has formally incorporated climate issues into governance matters, and oversees them through quarterly reports at Sustainability and Occupational Safety and Health meetings. The Board of Directors will provide strategic guidance and resource support for the management progress of climate risks and opportunities, and support the Sustainability Development Committee in promoting related work, enabling the commitments of senior management to be transformed into concrete actions. In the future, the Board will also regularly review the progress of climate-related strategies and targets to ensure that the Company is moving toward sustainable transformation.
2. Describe how the identified climate risks and opportunities affect the company's business, strategy, and finances (short-term, medium-term, long-term).	We have preliminarily identified several climate change-related risks and opportunities. Among these, the physical risks of "extreme climate" (including heavy rainfall, drought, high temperatures, low temperatures, and typhoons) may lead to increased operational safety risks for employees and property damage in the short term. In the medium term, water resource tensions could affect the stable operation of incineration equipment at Plant 1 and PCB recycling equipment at Plant 3. If the frequency of extreme climate events continues to rise in the future, it will increase equipment maintenance and insurance costs, impacting operational resilience. On the other hand, the company also pays attention to opportunities brought by climate transition, including the promotion of low-carbon circular economy policies, increased application of renewable energy, and enhanced potential for waste resource recovery. In the medium to long term, the company will evaluate green electricity procurement, energy-saving retrofits, and carbon inventory mechanisms to expand its green business layout in line with net-zero trends, strengthen competitive advantages, and attract sustainability-oriented investors.
3. Describe the financial impact of extreme climate events and transition actions.	Extreme climate events such as heavy rainfall, drought, high temperatures, etc., may impact the Company's plant operations and infrastructure.

Items	Implementation Status
	For example, heavy rainfall may cause delays in waste collection, compressing processing time, equipment damage, and increased maintenance costs for disaster prevention facilities; drought may limit water use for recycling and incineration processes, requiring additional purchases of industrial water or temporary suspension of specific processes, increasing operational costs. High and low temperatures will also affect employee health and scheduling efficiency, causing fluctuations in labor productivity. On the climate transition front, with the advancement of domestic carbon fee systems and green procurement policies, the company may face carbon emission costs or customer carbon reduction requirements in the future. For example, if energy conservation and green electricity are not introduced early in energy use, operating costs may increase or certain government and large enterprise tenders may be lost. In the long term, the Company must plan capital expenditures in advance (such as in-plant energy-saving renovations, carbon capture, green electricity procurement, or carbon inventory system implementation) to control financial impacts during the transition process.
4. Explain how the climate risk identification, assessment, and management processes are integrated into the overall risk management system.	In 2025, the Company has screened and confirmed the following items as climate-related risks and opportunities: environmental regulations, carbon fees, low-carbon technology transition, extreme climate events, participation in renewable energy projects and adoption of energy-saving measures, and development and/or expansion of low-carbon products and services. These items are classified and managed according to their likelihood of occurrence and degree of impact. The company has planned to formally incorporate the climate risk management mechanism into the existing risk inventory process in 2026, and include it in the annual operational risk assessment and internal audit review mechanism. Risk items will be included in the risk reporting responsibilities of each department, with the Sustainability Development Committee coordinating integration and conducting regular reviews, to strengthen the resilience and forward-looking nature of the company's overall risk management system.

Items

Implementation Status

For example, heavy rainfall may cause delays in waste collection, compressing processing time, equipment damage, and increased maintenance costs for disaster prevention facilities; drought may limit water use for recycling and incineration processes, requiring additional purchases of industrial water or temporary suspension of specific processes, increasing operational costs. High and low temperatures will also affect employee health and scheduling efficiency, causing fluctuations in labor productivity. On the climate transition front, with the advancement of domestic carbon fee systems and green procurement policies, the company may face carbon emission costs or customer carbon reduction requirements in the future. For example, if energy conservation and green electricity are not introduced early in energy use, operating costs may increase or certain government and large enterprise tenders may be lost. In the long term, the Company must plan capital expenditures in advance (such as in-plant energy-saving renovations, carbon capture, green electricity procurement, or carbon inventory system implementation) to control financial impacts during the transition process.

4. Explain how the climate risk identification, assessment, and management processes are integrated into the overall risk management system.

In 2025, the Company has screened and confirmed the following items as climate-related risks and opportunities: environmental regulations, carbon fees, low-carbon technology transition, extreme climate events, participation in renewable energy projects and adoption of energy-saving measures, and development and/or expansion of low-carbon products and services. These items are classified and managed according to their likelihood of occurrence and degree of impact. The company has planned to formally incorporate the climate risk management mechanism into the existing risk inventory process in 2026, and include it in the annual operational risk assessment and internal audit review mechanism. Risk items will be included in the risk reporting responsibilities of each department, with the Sustainability Development Committee coordinating integration and conducting regular reviews, to strengthen the resilience and forward-looking nature of the company's overall risk management system.

Items	Implementation Status
5. If scenario analysis is used to assess resilience to climate change risks, the scenarios, parameters, assumptions, analysis factors, and main financial impacts used should be explained.	Currently, the Company has not yet implemented climate scenario analysis tools; however, we recognize that they are helpful for assessing operational risks and financial impacts under different future climate conditions. The company will continue to pay attention to the practical applications and guidance resources for this tool from peers, consultants, and government agencies, and will gradually evaluate the timing and methods of implementation based on actual needs and technical maturity.
We preliminarily plan to reference climate change trends published by government and international climate organizations (such as the UN's IPCC) to simulate and make simple projections of potential scenarios including extreme weather, water resources, operational interruptions, and rising carbon fees under future climate condition changes. In the future, if further modeling tools become available, they will be incorporated as reference bases for equipment investment, facility planning, and risk management, to strengthen the company's adaptive capacity in facing climate challenges.
6. If there is a transition plan for managing climate-related risks, explain the content of the plan, and the indicators and targets used to identify and manage physical risks and transition risks.	The Company has completed a preliminary identification of climate physical risks in 2025, confirming that extreme climate events (such as heavy rain, drought, high temperatures, and low temperatures) are the main risk sources. The Company has simultaneously expanded its inventory of transition risks, including scenarios such as general environmental regulations, carbon fees, and low-carbon technology transition. Climate management indicators and reduction targets have been completed in 2025, with preliminary planning carried out for greenhouse gas emissions, energy use efficiency, and water resource management. For short-term and medium-term targets, please refer to the 2024 Sustainability Report.
The Company is also simultaneously planning the direction of future indicator-based management. The preliminary concept is to adopt "operational stability" and "resource use efficiency" as the core management principles. Proposed evaluation indicators include: the number of equipment anomalies caused by extreme climate events, electricity/water use intensity per ton of waste treatment services, the

Items	Implementation Status
	establishment rate of backup water sources at plant sites, and the ratio of carbon fees or energy expenditures to operating costs. Depending on future actual climate conditions, the number of equipment anomalies caused by extreme climate events and the establishment rate of backup water sources at plant sites may also be incorporated as evaluation indicators. In the future, we will also gradually establish medium and long-term energy conservation and carbon reduction targets in accordance with government regulatory initiatives and industry trends, and incorporate them into the supervision mechanism of the Sustainability Development Committee and the performance management system for senior executives.
The Company aims to strengthen climate risk response capabilities and climate adaptation capabilities through the gradual introduction of data-driven management, laying the foundation for subsequent scenario analysis and indicator management.
7. If internal carbon pricing is used as a planning tool, the basis for price setting should be explained	The Company has not yet implemented an internal carbon pricing system, mainly because the company's operational model focuses on waste treatment and circular economy businesses, and there is currently no need for interdepartmental, cross-service/product internal allocation of carbon costs or investment evaluation requirements, making the practical implementation of limited significance. However, the company has been monitoring the development of carbon fee systems and related government regulatory processes. In the future, if carbon costs become more sensitive to business decisions, we will evaluate establishing an internal carbon price based on domestic carbon fee reference prices or international carbon market prices, to serve as a basis for financial feasibility analysis of projects such as equipment replacement, energy-saving investments, or green electricity procurement.
8. If climate-related targets have been set, information should be provided on the activities covered, greenhouse gas emission scopes, planned timelines, and annual progress toward achievement; if carbon offsets or Renewable Energy Certificates	The Company has completed the greenhouse gas emissions inventory for Scope 1 and Scope 2 for the year 2024, and Plant 1 introduced the ISO 50001 Energy Management System in 2025 as the foundation for strengthening energy management and promoting carbon reduction. Based on the results of the carbon inventory, and

Items	Implementation Status
(RECs) are used to achieve related targets, the source and quantity of carbon reduction credits being offset or the quantity of Renewable Energy Certificates (RECs) should be explained.	with comprehensive consideration of equipment emission characteristics and operational models, a management mechanism centered on indicators such as electricity consumption intensity, carbon emission density per unit of processing volume, energy efficiency improvement rate, and the proportion of green energy usage has been established as the basis for promoting energy conservation and carbon reduction.
In terms of carbon reduction strategy planning, the Company has set phased targets: focusing on equipment energy-saving optimization in the short term, emphasizing system integration and energy efficiency improvement in the medium term, and advancing toward the introduction of renewable energy and low-carbon transformation in the long term. Going forward, the Company will continue to deepen the application of the energy management system and, in alignment with the Financial Supervisory Commission's 'Sustainable Development Roadmap for TWSE/TPEx Listed Companies,' plans to complete the relevant assurance engagements by 2028.
In addition, the implementation of carbon reduction targets will be regularly supervised and tracked by the Sustainability Development Committee, and the introduction of an internal management platform will be evaluated to enhance cross-departmental collaboration efficiency and information transparency.
Currently, the Company has not adopted carbon offsets or Renewable Energy Certificates (RECs). In the future, the Company will evaluate the use of self-generation for own use or certificate procurement as supplementary mechanisms based on actual needs.
9. Greenhouse gas inventory and verification status, reduction targets, strategies, and specific action plans	Please refer to the explanation in this annual report [Part 2, Section 2, (7), 2, The Company's greenhouse gas inventory and verification status for the past two years].

The Company's greenhouse gas inventory and verification status for the past two years: (1) Greenhouse gas inventory information (2) Greenhouse gas verification information (2) Greenhouse gas reduction targets, strategies, and specific action plans:

The Financial Supervisory Commission (FSC) issued the "Sustainable Development Roadmap for Listed Companies" on March 3, 2022, which progressively requires all listed companies to complete greenhouse gas inventory by 2027 and to complete verification of greenhouse gas inventory by 2029.

The Company has preliminarily conducted a self-inventory for Chung Tai Plant 1 in accordance with the 'Guidelines for Greenhouse Gas Emission Inventory and Registration' issued by the Ministry of Environment. The relevant data can be found in the 2025 Sustainability Report. According to the aforementioned roadmap, the Company has a capital of less than NT$5 billion and is subject to complete individual company inventory by 2026, complete consolidated statement scope inventory by 2027, complete individual company verification by 2028, and complete verification of subsidiaries within the consolidated statement scope by 2029. The Company will maintain a proactive attitude, continue to enhance the basic inventory data, and strive to complete the inventory and verification operations ahead of schedule, while further developing reasonable reduction targets and implementation pathways.

(8) Implementation of Ethical Corporate Management and Differences from the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies and the Reasons

Evaluation Item	Implementation Status
	Yes	No	Summary Description
1. Establishing Ethical Corporate Management Policies and Programs
(1) Has the company established an ethical corporate management policy approved by the Board of Directors, and clearly stated in its regulations and external documents the policies and	v		The Company has established "Ethical Corporate Management Best Practice Principles," "Procedures and Guidelines for Ethical Corporate Management," and "Code of Ethical Conduct," enabling the Directors and employees of the Company to understand the Company's ethical standards, and to engage in business activities based on the principles of fairness, honesty, trustworthiness, and transparency, effectively implementing ethical corporate management policies.
1. The scope of the "Ethical Corporate Management Best Practice Principles" and "Procedures and	No significant difference.

Evaluation Item	Implementation Status			Differences from the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies and the Reasons
	Yes	No	Summary Description
practices of ethical corporate management, as well as the commitment of the Board of Directors and senior management to actively implement the management policy?			Guidelines for Ethical Corporate Management" includes prohibitions on bribery and acceptance of bribes, illegal political contributions, improper charitable donations or activities, and improper acceptance of gifts or hospitality. The code also stipulates that Directors, supervisory units, and managerial officers should avoid conflicts of interest, and establishes a comprehensive internal control system for dishonest behaviors or high-risk business activities with potential risks.
2. The scope of the "Code of Ethical Conduct" includes avoiding conflicts of interest and improper benefits transfer, prohibition of seeking personal gain, implementing confidentiality of company and customer information, fair trading and truthful reporting of transactions, proper use and maintenance of company assets, etc.
Currently, the Chairman's Office is established as the dedicated unit responsible for the revision, implementation, interpretation, consultation services, registration and filing of reported content, and other related operations and supervision of this procedure and behavioral guidelines, and regularly reports to the Board of Directors.
Various internal regulations and external documents, such as the Employee Code of Conduct and Vendor Commitment Letter, clearly state the policies and practices of ethical corporate management, and strictly require company employees to fulfill the company's integrity policy.
(2) Has the company established a risk assessment mechanism for dishonest behavior, regularly analyzing and evaluating business activities with higher risks of dishonest behavior within the scope of operations, and accordingly formulating	v		The Company has established the Ethical Corporate Management Best Practice Principles, Procedures and Guidelines for Ethical Corporate Management, and Code of Ethical Conduct through Board of Directors resolutions. To prevent dishonest behavior, the Company has strengthened relevant preventive measures in its regulations and external documents targeting business activities with higher risks of dishonest behavior. In addition, the Company requires all employees to fully understand the aforementioned regulations, and publishes these regulations on the company's official website and internal platform for internal and external personnel to access at any time. The Company also continues to use regular educational training and diversified promotional methods to ensure employees clearly	No significant difference.

Evaluation Item	Implementation Status			Differences from the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies and the Reasons
	Yes	No	Summary Description
prevention programs against dishonest behavior, which at least cover the preventive measures for various behaviors specified in Paragraph 2, Article 7 of the "Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies"?			understand the regulations they should comply with, thereby reducing the occurrence of dishonest behavior.
(3) Has the company specified operational procedures, behavioral guidelines, disciplinary and grievance systems for violations in its program to prevent dishonest behavior, implemented them effectively, and regularly reviewed and revised the aforementioned program?	v		To prevent any dishonest behavior, the Company not only requires suppliers, contractors, or other partners to promise in writing that they will not engage in any illegal business activities and will not provide improper benefits or bribes to the Company's employees. When encountering vendors with higher risks of dishonest behavior, in addition to being able to terminate or dissolve the contract at any time, the Company will report serious cases to judicial authorities. The Company has established the "Corporate Ethical Management Best Practice Principles," which clearly defines operational procedures, behavioral guidelines, disciplinary and grievance systems for violations, and implements them effectively. When regulations are amended, the Company reviews whether the "Corporate Ethical Management Best Practice Principles" needs to be revised accordingly when presenting the annual implementation report on promoting corporate ethical management to the Board of Directors.	No significant difference.
2. Implementation of Ethical Management
(4) Does the company evaluate the integrity records of its business counterparts and clearly specify ethical behavior	v		The Company requires suppliers to sign and comply with the vendor commitment letter to jointly practice the Company's corporate culture of ethical management. In addition, the Company continues to promote policies to suppliers and customers, which not only conveys the Company's ethical management culture to suppliers and customers but also helps to	No significant difference.

Evaluation Item	Implementation Status			Differences from the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies and the Reasons
	Yes	No	Summary Description
clauses in the contracts signed with these counterparts?			understand whether any behaviors inconsistent with integrity and honesty have occurred.
(5) Does the company have a dedicated unit to promote corporate ethical management that reports directly to the Board of Directors, and does it regularly (at least once a year) report to the Board on its ethical management policies, measures to prevent dishonest conduct, and the supervision of implementation?	v		The Company's Chairman's Office serves as the dedicated unit to continuously promote various ethical management initiatives according to company policy and communicate integrity and ethical matters. Report annually to the Board of Directors on the ethical management policies, measures to prevent dishonest conduct, and the supervision of implementation. In case of any violations of integrity and ethics, the Company will take disciplinary actions against the violators.
The most recent report on ethical management and professional conduct presented to the Board of Directors by the Company was on December 24, 2025.	No significant difference.
(6) Has the company established policies to prevent conflicts of interest, provided appropriate channels for disclosure, and implemented them effectively?	v		The Company has established relevant regulations to prevent conflicts of interest in the Code of Ethical Conduct for Directors and Managerial Officers and the Code of Conduct for Employees. And requires all colleagues to proactively disclose and recuse themselves from any situations involving conflicts of interest. To implement the policy effectively, the Company also requires employees to complete questionnaires to proactively report whether there are any conflicts of interest.	No significant difference.
(7) Has the company established effective accounting systems and internal control systems to implement ethical management, and has the internal audit unit formulated relevant audit	v		The Company has established a complete and effective accounting system and internal control system, and continuously reviews and improves them to ensure the effectiveness of system design and implementation. The Company has an internal audit unit that formulates annual audit plans based on the results of unethical behavior risk assessments and conducts reviews of the implementation of various fraud prevention measures to ensure the adherence to and compliance with relevant systems.
In addition, the Company has engaged Deloitte & Touche to conduct the annual financial statement audit. The audit is conducted in accordance with	No significant difference.

Evaluation Item	Implementation Status			Differences from the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies and the Reasons
	Yes	No	Summary Description
plans based on the risk assessment results of dishonest behaviors, and accordingly checked the compliance with the program to prevent dishonest behaviors, or commissioned accountants to perform audits?			relevant auditing standards, with the primary purpose of expressing an opinion on whether the financial statements are fairly presented, rather than primarily for the purpose of detecting fraud. However, if any material irregularities or suspected improprieties are discovered during the audit process, the auditors will communicate with the Audit Committee in accordance with regulations to strengthen corporate governance and oversight mechanisms.
(8) Does the company regularly conduct internal and external education and training on ethical management?	v		Education and training is the most important component in implementing the Company's integrity policy. The Company continues to strengthen employees' awareness of legal compliance through ethical management education and training courses, while also promoting ethical management norms through the official website and other channels. The Company also regularly conducts internal education and training on anti-corruption and unlawful infringement policies. In addition, to ensure suppliers comply with the Company's ethical management policy, the Company has not only drafted Supplier Corporate Social Responsibility Code of Conduct for suppliers to follow, but has also published these regulations on the Company's official website for their reference at any time.	No significant difference.
3. The operation of the company's whistleblowing system
(1) Has the company established a specific whistleblowing and reward system, convenient reporting channels, and assigned appropriate dedicated	v		The Company has established a reporting mailbox and provides information on whistleblowing channels and handling procedures for internal and external personnel to use at any time. Additionally, this reporting channel information is disclosed in the Company's internal promotional posters and in the vendor commitment letters that suppliers must sign, allowing both internal and external parties to be aware of and fully utilize the reporting channels for making reports. The Company's Ethical Management Procedures and Behavioral Guidelines stipulate that all received	No significant difference.

Evaluation Item	Implementation Status
	Yes	No	Summary Description
personnel to handle reported cases?			reports are kept completely confidential and rigorously investigated, along with procedures for reporting investigation findings, and these are disclosed in the Corporate Sustainability section of the Company's website when it does not affect the Company's trade secrets. On the "Contact Us" page of the Company's website, in addition to providing contact information for stakeholders, there is also a "Reporting Channel for Violations of Business Ethics." Internal and external whistleblowers can contact the Company via telephone or email. The Company's audit supervisor is responsible for receiving and investigating reported cases, and reports the investigation results to the independent directors or the Board of Directors. The management level is also seriously required to review the internal control system and management rules to reduce unethical or illegal behaviors and issues related to organizational integrity. In addition, to prevent sexual harassment incidents, the Company has set up a dedicated mailbox, hotline, and email address for handling sexual harassment complaints in the workplace. A senior female executive who serves as the Administrative Vice President is responsible for receiving complaint cases. The Company believes that the Administrative Vice President will be able to handle any related sexual harassment incidents fairly.
(2) Has the Company established standard operating procedures for investigating reported matters, follow-up measures to be taken after the investigation is completed, and related confidentiality mechanisms?	v		For the investigation of reported cases, the Company conducts investigations with a confidential and rigorous attitude. Subsequently, the Company plans to establish "Corruption Incident Investigation and Management Operating Regulations" to detail the standard operating procedures for handling reported matters and related confidentiality mechanisms. After the investigation of a reported case is completed, the Company takes subsequent measures according to internal regulations based on the severity of the situation. If criminal liability is involved, the case is referred to judicial authorities for investigation.
(3) Has the Company adopted measures to protect whistleblowers	v		The Company strictly prohibits any form of retaliation. To protect whistleblowers, the Company has clearly stipulated in its internal regulations that the Company will protect whistleblowers from any

Evaluation Item	Implementation Status			Differences from the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies and the Reasons
	Yes	No	Summary Description
from improper treatment due to their reporting?			retaliation due to their reporting, and prohibits colleagues from taking any retaliatory measures in the company's internal rules. During the investigation process, the investigation team also strictly complies with the relevant regulations regarding the confidentiality of the whistleblower's identity and anonymous reporting, adheres to the standard operating procedures for investigating reported matters and related confidentiality mechanisms, and protects the confidentiality of the whistleblower's identity, ensuring that whistleblowers do not suffer improper treatment due to their reporting.
4. Enhance Information Disclosure
(1) Has the Company disclosed the content and promotion results of its established Ethical Corporate Management Best Practice Principles on its website and the Market Observation Post System?	v		The Company has planned to disclose the Ethical Corporate Management Best Practice Principles on the company website for easy reference at any time. In addition, the content and promotion results of the Ethical Corporate Management Best Practice Principles are also disclosed in detail in the annual report for shareholders' meetings.	No significant difference.
5. If the Company has established its own Ethical Corporate Management Best Practice Principles in accordance with the "Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies," please describe any differences between its operation and the established principles: The Company has established its Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies, and has disclosed them on the company website and the Market Observation Post System. All employees of the Company and its affiliated enterprises must comply with these regulations, and there are no significant differences from the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies.
6. Other important information that helps understand the Company's ethical corporate management operations (such as the Company's review and revision of its established Ethical Corporate Management Best Practice Principles):
(1) Strictly comply with business conduct regulations and other listing-related norms as the foundation for implementing ethical corporate management, and continuously conduct legal identification and updates to ensure regulatory implementation.
(2) The Company continues to conduct business ethics and regulatory risk assessments annually, implementing business ethics risk management through the internal control system.

(9) Other important information that helps enhance understanding of the Company's corporate governance operations may also be disclosed

Directors' continuing education in 2025:

Date	Course Topic	Course Name	Organizer	Hours	Directors Who Participated
2025/5/7	Corporate Governance Category	Corporate Integrity Management and Sustainable Governance Strategy	Taiwan Corporate Governance Association	3	Chuang, Jui-Yuan
2025/7/9	Corporate Sustainability Category	Cathay Sustainable Finance and Climate Change Summit Forum	Taiwan Stock Exchange Corporation	3	Wei, Kuo-Yen
2025/7/9	Corporate Governance Category	Corporate Governance and Securities Regulations (Part I) (Part II)	Taiwan Corporate Governance Association	6	Wu, Chun-I
2025/8/6	Law	Case Studies and Legal Liability Analysis of Greenwashing and False Sustainability Reports	Securities and Futures Institute	3	Yang, Yung-Fa, Chen, Yu-Hsien, Chen, Tsung-Tien, Cheng, Kuang-Chieh, Wei, Kuo-Yen, Fang, Yao-Hua, Wang, Yu-Ling
2025/11/5	Corporate Sustainability Category	The Importance of Corporate Artificial Intelligence Applications and Practical Cases	Securities and Futures Institute	3	Yang, Yung-Fa, Chen, Yu-Hsien, Chen, Tsung-Tien, Cheng, Kuang-Chieh, Fang, Yao-Hua, Wang, Yu-Ling

Corporate Governance Officer's continuing education in 2025:

Date	Course Topic	Course Name	Organizer	Hours	Continuing Education Officer
2025/7/9	Corporate Sustainability Category	Cathay Sustainable Finance and Climate Change Summit Forum	Taiwan Stock Exchange Corporation	6	Shih, Hsiu-Wei
2025/7/15	Corporate Sustainability and Net-Zero Strategy Course for Directors	Greenhouse Gas Management Practical Workshop and Sustainable Development Seminar – Taipei Session	Taiwan Corporate Governance Association	9	Shih, Hsiu-Wei
2025/7/16
2025/8/6	Law	Case Studies and Legal Liability Analysis of Greenwashing and False Sustainability Reports	Securities and Futures Institute	3	Shih, Hsiu-Wei
2025/11/5	Corporate Sustainability Category	The Importance of Corporate Artificial Intelligence Applications	Securities and Futures Institute	3	Shih, Hsiu-Wei

(10) The following items should be disclosed regarding the implementation status of the internal control system:

Internal Control Statement:
For the 2025 Internal Control System Statement, please refer to Market Observation Post System > Single Company > Corporate Governance > Company Regulations/Internal Control > Internal Control Statement Announcement, Website: https://mops.twse.com.tw/mops/#/web/t06sg20.
If a CPA has been commissioned to conduct a special audit of the internal control system, the CPA's audit report should be disclosed: Not applicable.

Important resolutions of the shareholders' meetings and board of directors' meetings in the most recent year and up to the date of the annual report's publication.

Important resolutions of the annual and extraordinary shareholders' meetings in the most recent year and up to the date of the annual report's publication, and their implementation status:

Date	Important Resolutions of Shareholders' Meetings	Implementation Status
2025/6/26
(Annual Shareholders' Meeting)	Business Report and Financial Statements for fiscal year 2024.	Approved Proposal
	Earnings Distribution for fiscal year 2024.	Approved Proposal
	Complete re-election of Directors	Successfully elected and convened the 9th Board of Directors
	Distribution of cash dividends from capital surplus	Approved as proposed and distributed
	Amendment of Certain Articles of the Company's Articles of Incorporation.	Approved as proposed
	Lifting the non-competition restrictions for newly elected directors.	Approved as proposed, and the non-competition restrictions for the Directors of the 9th Board were lifted

Important resolutions of the Board of Directors for the year 2025 and up to the date of printing of the annual report:

Date	Resolution Item:
2025/03/11	1. Distribution of Employees' and Directors' Compensation for 2024
	2. Distribution of Individual Compensation for Non-Independent Directors for 2024
	3. 2024 Business Report and Financial Statements
	4. 2024 Earnings Distribution and Cash Distribution from Capital Surplus
	5. Renewal of Credit Facility from Far Eastern International Bank
	6. Renewal of Credit Facility from Taiwan Cooperative Bank
	7. Amendment to the Company's "Internal Control System - Payroll Cycle
	8. "Statement of Internal Control System" for the year 2024
	9. Complete Re-election of Directors (including Independent Directors)
	10. Nomination of Director (including Independent Director) Candidates and Qualification Review
	11. Lifting the non-competition restrictions for newly elected directors.
	12. Convening Reasons for the 2025 Annual General Shareholders' Meeting
	13. Matters Related to Accepting Shareholder Proposals (Nominations) in 2025
2025/04/10	1. Proposed Repurchase of the Company's Common Shares
	2. Proposal to issue a Board of Directors declaration in accordance with the 'Regulations Governing Share Repurchase by Exchange-Listed and OTC-Listed Companies' promulgated by the Securities and Futures Bureau of the Financial Supervisory Commission
2025/05/08	1. Consolidated financial report for the first quarter of 2025
	2. Selection of auditors for the Company for 2025 through the first quarter of 2028, evaluation of Audit Quality Indicators (AQIs), and assessment of the independence and competence of the signing auditors
	3. Renewal of Credit Facility from Mega Bank
	4. Renewal of Credit Funding with CTBC Bank
	5. Proposal to formulate the 'Procedures for the Transfer of Repurchased Shares to Employees' in accordance with operational needs
2025/06/26	1. Election of the Chairman of the 9th term
	2. Proposal to Invest in CLEANAWAY Co., Ltd.
	3. Proposal to appoint members of the Remuneration Committee
2025/08/12	1. Consolidated financial report for the second quarter of 2025
	2. Proposal to publish the 2024 Sustainability Report of Chung Tai

Date	Resolution Item:
	3. Nomination and appointment of members of the Sustainability Development Committee
	4. Proposal to establish the "Management Procedures for Buyback of Treasury Shares"
	5. Amendment to the Internal Control System – Administrative Control Operations (addition of management of treasury share buyback operations) and Internal Audit Implementation Guidelines (addition of management audit procedures for treasury share buyback operations)
	6. Renewal of Credit Facility from Yuanta Bank
	7. Application for Credit Facility with Shin Kong Bank
2025/08/28	1. Proposal to increase investment in ordinary shares of SMOKING ENVIRONMENTALLY FRIENDLY CORPORATION and strategic cooperation
2025/10/09	1. Proposal to lend funds to SMOKING ENVIRONMENTALLY FRIENDLY CORPORATION
2025/11/10	1. Consolidated financial report for the third quarter of 2025
	2. Renewal of Credit Facility from Hua Nan Bank
2025/12/24	1. Proposal for the 2025 Corporate Value Enhancement Plan
	2. 2026 Annual Operating Plan and Business Budget
	3. Establishing the Company's 2026 Internal Audit Plan
	4. Proposal to define the scope of applicability of the definition of "entry-level employees" of the Company
	5. Proposed amendment to the Company's "Internal Control System - Payroll Cycle
	6. Renewal of Credit Facility from Cathay United Bank
	7. 2026 Independent Director Compensation Case
	8. 2025 Year-End Bonus Case for Chairman and Managerial Officers
	9. 2026 Compensation Case for Chairman and Managerial Officers
2026/03/06	1. Distribution of Employees' and Directors' Compensation for 2025
	2. Distribution of Individual Compensation for Non-Independent Directors for 2025
	3. 2025 "Statement of Internal Control System"
	4. 2025 Business Report and Financial Statements
	5. 2025 Earnings Distribution and Cash Distribution from Capital Surplus
	6. Renewal of Credit Facility from CTBC Bank
	7. Renewal of Credit Facility from Taiwan Cooperative Bank
	8. Amendment of Certain Articles of the Company's Articles of Incorporation.
	9. Convening Reasons for the 2026 Annual General Shareholders' Meeting

Date	Resolution Item:
	10. Matters Related to Accepting Shareholder Proposals in 2026
	11. Review of internal rotation, independence, competence, and Audit Quality Indicators (AQIs) of the CPA firm engaged to certify the 2026 financial statements
	12. Proposal for the Company to waive subscription rights to the cash capital increase of ordinary shares of its investee company, Chase Sustainability Technology Co., Ltd., and to agree to sign a shareholder agreement

(11) In the most recent year and up to the printing date of the annual report, there were no recorded or written statements of disagreement from directors or supervisors regarding important resolutions passed by the Board of Directors: Not applicable.

3. Certified Public Accountant Fee Information

(1) Payment amounts of audit fees and non-audit fees to the certified public accountant, their accounting firm, and affiliated enterprises, as well as the content of non-audit services:

Amount Unit: NT$ thousand

Name of Accounting Firm	CPA Name	Audit Period of the Accountant	Audit Fees	Non-Audit Fees (Note)	Total	Notes
Deloitte & Touche	Chiu, Yung-Ming, Shih, Chin-Chuan	2025/1/1-2025/12/31	1,790	340	2,130	None

Note: The non-audit service fees entrusted by the Company to Deloitte & Touche include "profit-seeking enterprise income tax certification," "provisional profit-seeking enterprise income tax certification," and "annual shareholders' meeting report review," among others.

(2) If the audit fees paid in the year when the accounting firm was changed are less than those paid in the year prior to the change: Not applicable.

(3) Audit fees decreased by 10% or more compared to the previous year: Not applicable.

4. Change of CPA information: Not applicable.

The situation where the Company's Chairman, President, or Manager responsible for financial or accounting affairs has, within the past year, served at the certifying accounting firm or its affiliated enterprises: Not applicable.
Changes in Shareholding and Pledge of Shares by Directors, Supervisors, Managerial Officers, and Shareholders Holding More Than 10% of the Company's Shares in the Most Recent Year and as of the Date of the Annual Report

(1) Changes in Shareholding and Pledge of Shares by Directors, Supervisors, Managerial Officers, and Shareholders Holding More Than 10% of the Company's Shares:

For information disclosure, please refer to

Shareholding transfer: Market Observation Post System > Single Company > Shareholding Changes/Securities Issuance > Shareholding Transfer Data Inquiry > Insiders' Shareholding Changes Post-reporting Form, website https://mops.twse.com.tw/mops/#/web/query6_1.
Changes in pledge of shares: Market Observation Post System > Single Company > Shareholding Changes/Securities Issuance > Insiders' Pledging and Releasing of Pledges > Announcement of Insiders' Pledging and Releasing of Pledges, website https://mopsov.twse.com.tw/mops/web/STAMAK03_1.

(2) Information regarding the transfer of shares by Directors, Supervisors, Managerial Officers, and Shareholders holding more than 10% of shares to related parties: Not applicable.

(3) Information regarding the pledge of shares by Directors, Supervisors, Managerial Officers, and Shareholders holding more than 10% of shares to related parties: Not applicable.

Information on the relationship between the top ten shareholders, whether they are related parties or spouses, relatives within the second degree of kinship

March 27, 2025; Unit: Shares; %

Name	Shares held by the person		Shares held by spouse and minor children		Shares held in the name of others		Names and relationships of the top ten shareholders who are related parties or are spouses, relatives within the second degree of kinship		Notes
	Number of shares	Shareholding ratio	Number of shares	Shareholding ratio	Number of shares	Shareholding ratio	Name (or full name)	Relationship
Cleanaway Company Limited	16,447,000	17.98%	-	-	1,064,000 (Note 1)	1.16% (Note 1)	-	-	-
Representative: Yang, Ching-Hsiang	-	-	-	-	-	-	Yang, Yung-Fa	Father-son	-
Yang, Yung-Fa	12,120,755	13.25%	-	-	270,000 (Note 2)	0.30% (Note 2)	Yang, Ching-Hsiang	Father-son	-
Cheng, Kuang-Chieh	3,439,626	3.76%	1,293,104	1.41%	-	-	Huang, Chen-Ying	Spouse	-
Jiin Yeeh Ding Enterprise Corp.	2,940,659	3.21%	-	-	-	-	-	-	-
Representative: Chuang, Ching-Chi	-	-	-	-	-	-	-	-	-
He Rui Investment Co., Ltd.	2,126,600	2.32%	-	-	-	-	-	-	-
Representative: Yen, Kan-Lin	-	-	-	-	-	-	-	-	-
Wu, Chun-I	1,750,000	1.91%	-	-	-	-	-	-	-
Zhuo Li Investment Co., Ltd.	1,340,000	1.46%	-	-	-	-	-	-	-
Representative: Lien, Ming-Jen	-	-	-	-	-	-	-	-	-

Name	Shares held by the person		Shares held by spouse and minor children		Shares held in the name of others		Names and relationships of the top ten shareholders who are related parties or are spouses, relatives within the second degree of kinship		Notes
	Number of shares	Shareholding ratio	Number of shares	Shareholding ratio	Number of shares	Shareholding ratio	Name (or full name)	Relationship
Kuo, Ya-Hui	1,254,000	1.36%	-	-	-	-	-	-	-
Huang, Chen-Ying	1,293,104	1.41%	3,439,626	3.76%	-	-	Cheng, Kuang-Chieh	Spouse	-
Cheng, Su-I	1,197,112	1.31%					Cheng, Kuang-Chieh	Brother and sister

Note 1: Cleanaway Co., Ltd. holds 1,064,000 shares (1.16% ownership) of the Company through its subsidiaries JI WEI Co., Ltd. and Da Ning Co., Ltd.
Note 2: Yang, Yung-Fa holds 270,000 shares (0.29% ownership) of the Company through QIAO ZHI YANG Co., Ltd.

The shareholdings of the Company, its directors, supervisors, managerial officers, and enterprises directly or indirectly controlled by the Company in the same invested enterprises, and the calculation of comprehensive shareholding ratio: Not applicable.

III. Funding Status

Capital and Shares

(1) Source and Types of Capital

March 31, 2026; Unit: NT$ thousand; thousand shares

Month/Year	Issue Price (NT$)	Authorized Capital		Paid-in Capital		Notes
		Number of Shares (thousand shares)	Amount (thousand NT$)	Number of Shares (thousand shares)	Amount (thousand NT$)	Source of Capital	Capital Contributions in Property Other Than Cash	Others
2001.05	10	10,000	100,000	5,000	50,000	Initial capital of NT$50,000 thousand	None	Note 1
2005.08	10	10,000	100,000	5,500	55,000	Earnings Transferred to Capital Increase NT$5,000 thousand	None	Note 2
2006.08	10	30,000	300,000	10,010	100,100	Earnings Transferred to Capital Increase NT$45,100 thousand	None	Note 3
2007.10	10	30,000	300,000	16,345	163,450	Earnings Transferred to Capital Increase NT$63,350 thousand	None	Note 4
2008.09	10	30,000	300,000	24,722	247,220	Earnings Transferred to Capital Increase NT$83,770 thousand	None	Note 5
2009.11	10	30,000	300,000	27,597	275,970	Earnings Transferred to Capital Increase NT$28,750 thousand	None	Note 6
2010.09	10	30,000	300,000	28,487	284,870	Earnings Transferred to Capital Increase NT$8,900 thousand	None	Note 7
2011.10	10	50,000	500,000	31,365	313,654	Earnings Transferred to Capital Increase NT$28,784 thousand	None	Note 8
2012.02	10	50,000	500,000	37,365	373,654	Cash Capital Increase NT$60,000 thousand	None	Note 9
2013.11	10	50,000	500,000	40,840	408,404	Earnings Transferred to Capital Increase NT$34,749 thousand	None	Note 10
2018.06	10	80,000	800,000	59,924	599,244	Earnings Transferred to Capital Increase NT$40,840 thousand Cash Capital Increase NT$150,000 thousand	None	Note 11
2019.03	24	80,000	800,000	77,924	779,244	Cash Capital Increase NT$180,000 thousand	None	Note 12
2021.09	25	160,000	1,600,000	81,124	811,244	Cash Capital Increase NT$32,000 thousand	None	Note 13
2023.01	85	160,000	1,600,000	82,624	826,244	Cash Capital Increase NT$15,000 thousand	None	Note 14
2024.09	80	160,000	1,600,000	91,888	918,880	Cash Capital Increase NT$92,636 thousand	None	Note 15
2025.10	-	160,000	1,600,000	91,488	914,880	Cancellation of Treasury Shares, Capital Reduction NT$400 Thousand	None	Note 16

Note 1: Taipei City Construction Industry Document No. 90278602, dated May 9, 2001.
Note 2: Municipal Industry and Commerce Document No. 09417026210, dated August 16, 2005.
Note 3: Municipal Industry and Commerce Document No. 09582685320, dated September 12, 2006.
Note 4: Municipal Industry and Commerce Document No. 09690513000, dated October 17, 2007.
Note 5: Municipal Industry and Commerce Document No. 09791367610, dated November 17, 2008.
Note 6: Municipal Industry and Commerce Document No. 09890396610, dated November 12, 2009
Note 7: Municipal Industry and Commerce Document No. 09990768120, dated January 11, 2011.
Note 8: Municipal Industry and Commerce Document No. 10088277400, dated October 7, 2011.
Note 9: Municipal Industry and Commerce Document No. 10180979810, dated February 17, 2012
Note 10: Municipal Industry and Commerce Document No. 10189424610, dated November 13, 2012
Note 11: Commercial Public Document No. 10701067700, dated June 27, 2018.
Note 12: Commercial Public Document No. 10801035230, dated April 2, 2019.
Note 13: Commercial Public Document No. 11001155280, dated September 1, 2021.
Note 14: Commercial Public Document No. 11230009550, authorized on February 9, 2023.
Note 15: Commercial Public Document No. 11330176330, authorized on October 15, 2024.
Note 16: Commercial Public Document No. 11430142720, authorized on October 20, 2025.

March 31, 2026; Unit: Shares

Type of Shares	Authorized Capital			Notes
	Outstanding Shares	Unissued Shares	Total
Common Shares	91,488,000	68,512,000	160,000,000	Listed Company Shares

(2) List of Major Shareholders

Shareholders who hold more than 5% of shares or are among the top ten shareholders in terms of shareholding percentage: names, number of shares held, and percentages:

March 27, 2025; Unit: Shares; %

Shares Name of Major Shareholders	Number of Shares Held	Shareholding Ratio
CLEANAWAY Co., Ltd.	16,447,000	17.98%
Yang, Yung-Fa	12,120,755	13.25%
Cheng, Kuang-Chieh	3,439,626	3.76%
JIIN YEEH DING ENTERPRISE CORP.	2,940,659	3.21%
HE RUI INVESTMENT CO., LTD.	2,126,600	2.32%
Wu, Chun-I	1,750,000	1.91%
ZHUO LI INVESTMENT CO., LTD.	1,340,000	1.46%
Kuo, Ya-Hui	1,321,000	1.44%
Huang, Chen-Ying	1,293,104	1.41%
Cheng, Su-I	1,197,112	1.31%
Total	43,975,856	48.07%

(3) Company Dividend Policy and Implementation Status

The dividend policy stipulated in the Company's Articles of Incorporation is as follows:

If the Company records a profit in its annual final accounts, it shall first pay taxes and offset accumulated losses, then allocate 10% as legal reserve, except when the legal reserve has reached the Company's paid-in capital. After that, the Company shall set aside or reverse special reserve in accordance with laws and regulations. If there is any remaining profit, along with the accumulated undistributed earnings, the Board of Directors shall prepare a proposal for profit distribution and submit it to the shareholders' meeting for resolution.

The Company offers diverse products and services, making it difficult to distinguish its growth stage. However, there are plans for significant production line expansion and capital requirements in the coming years. The Board of Directors will distribute shareholders' dividends after considering the current capital expenditure budget, financing funds and financial structure, operational needs, shareholders' interests, and balanced dividends. The distribution ratio shall not be less than ten percent of the distributable earnings for the current period. The Company's shareholder dividends may be distributed in the form of cash or stock, provided that the proportion of cash dividends shall not be less than ten percent of the total shareholder dividends.

Proposed Shareholder Dividend Distribution for This Year

The Company's profit distribution for fiscal year 2025 was approved by the Board of Directors on March 6, 2026. From the distributable earnings, NT$242,443,200 is proposed to be distributed to shareholders as cash dividends of NT$2.65 per share. Additionally, NT$32,020,800 from the capital surplus from the premium on issuance of common shares is proposed to be distributed to shareholders as cash of NT$0.35 per share. The total cash distribution amounts to NT$274,464,000, with a total cash distribution of NT$3.00 per share. This profit distribution proposal is scheduled to be submitted for approval at the Annual General Shareholders' Meeting on May 25, 2026.

Expected significant changes in dividend policy: No significant changes.

Except for the fiscal year 2020, when a portion of earnings was retained due to funding requirements for plant construction, the Company has adopted a cash-based earnings distribution policy in all other years, distributing earnings based on the profit of the respective year after setting aside the statutory surplus reserve (10%). The earnings per share for 2025 is NT$3.03. The Board of Directors has proposed a cash dividend per share and capital distribution totaling NT$3.0, continuing the consistent and prudent dividend policy, maintaining the cash dividend payout ratio at above 90%, and continuing to return value to shareholders while taking into account the Company's long-term capital planning needs.

(4) Impact of the proposed stock dividends on the Company's operating performance and earnings per share at this shareholders' meeting: Not applicable.

(5) Employee and Director Compensation:

Percentages or ranges of employee, director, and supervisor compensation as stipulated in the Company's Articles of Incorporation:

If the Company earns a pre-tax profit in a given fiscal year, no less than one percent (1%) thereof shall be allocated as employee compensation, to be distributed in the form of shares or cash as resolved by the Board of Directors. The recipients may include employees of subsidiaries meeting certain criteria. Furthermore, no less than fifteen percent (15%) of the employee compensation amount shall be distributed to frontline employees. The Company may, from the aforementioned profit amount, allocate no more than five percent (5%) as Director compensation, as resolved by the Board of Directors. The distribution of employee compensation and directors' compensation shall be reported to the shareholders' meeting. However, if the Company still has accumulated losses, it shall reserve the amount for covering the losses first, and then allocate employee compensation and directors' remuneration according to the ratio in the preceding paragraph.

Basis for estimating the amount of employee, director, and supervisor compensation for the current period, calculation basis for the number of shares for employee compensation distributed as stock, and accounting treatment if the actual distribution amount differs from the estimated amount:

The Company estimates the amount of employee and director compensation based on the pre-tax net profit before deducting employee compensation and director compensation, calculated according to the appropriation percentages specified in the Company's Articles of Incorporation, and recognizes it as salary expense. If the actual distribution amount differs from the estimated amount, it will be treated as a change in accounting estimate, and the difference will be recognized in the profit or loss of the following year.

The distribution of compensation approved by the Board of Directors:

(1) The amount of employee compensation and director and supervisor compensation distributed in cash or stock. If there is a difference from the estimated amount recognized as an expense for the year, the difference, reason, and handling situation should be disclosed:

The Company's Board of Directors passed the distribution of employee compensation and director compensation for fiscal year 2025 on March 6, 2026, with employee compensation and director compensation amounting to NT$9,107 thousand and NT$2,928 thousand respectively, all to be distributed in cash, with no difference in expense recognition.

35% of the aforementioned employee compensation is allocated to entry-level employees, amounting to NT$3,187,450. Entry-level employees as

defined for 2025 refer to employees who are not "Managerial Officers" and whose regular salary is below NT$63,000.

(2) The ratio of employee compensation distributed in stock to the sum of current after-tax net income and total employee compensation: The Company did not distribute employee compensation in stock for the year 2025, so this is not applicable.

The actual distribution of employee and director compensation for the previous year (including the number of shares distributed, amount, and share price), and if there is a difference from the recognized employee and director compensation, the difference, reason, and handling situation should be described:

The Company's Board of Directors resolved on March 11, 2025 to distribute employee compensation and director/supervisor compensation for fiscal year 2024 in cash amounting to NT$10,084 thousand and NT$2,600 thousand respectively, which is the same as the employee compensation and director/supervisor compensation recognized in the financial reports. The Company's employee compensation for the year 2024 was reported to the Annual General Meeting of Shareholders on June 26, 2025, with no changes to the distribution amounts of employee and director compensation.

(6) Status of Company's Share Repurchase:

The Company's Board of Directors resolved on April 10, 2025 to repurchase the Company's common shares on the centralized securities exchange market. The relevant information is as follows:

Repurchase period	First meeting of 2025 (approved by the Board of Directors on April 10, 2025)
Purpose of repurchase	To maintain the Company's credibility and shareholders' equity, repurchase and cancel shares
Repurchase period	From April 11, 2025 to June 10, 2025
Price range for repurchase	NTD 50 to 115.5 per share
Type and Number of shares of already repurchased	Ordinary shares 2,000 thousand shares
Amount of shares already repurchased	NTD 29,248,514
Type and Number of shares of already repurchased	Ordinary shares 400 thousand shares
Ratio of already repurchased quantity to the planned repurchase quantity	20.00%
Number of shares cancelled and transferred	Ordinary shares 400 thousand shares
Ratio of cumulative shares held in the Company to total issued shares	0.44%

Status of corporate bonds issuance: Not applicable.
Status of preferred stock issuance: Not applicable.
Status of overseas depository receipts issuance: Not applicable.
Status of employee stock options issuance: Not applicable.
Status of restricted employee shares issuance: Not applicable.
Status of new shares issuance for merger or acquisition of other companies: Not applicable.
Status of implementation of capital allocation plans

As of the quarter preceding the printing date of the annual report, the details and implementation status of any previous issuance or private placement of securities that have not been completed, or have been completed within the last three years but have not yet shown their planned benefits:

The previous cash capital increase plan involved a capital increase of NT$787,511 thousand in 2024. The details of the plan, its implementation status, and benefit analysis are as follows. Relevant public information can also be found at

For plan details, please refer to Market Observation Post System > Single Company > Equity Changes/Securities Issuance > Fundraising > Implementation of Fundraising Plans, website: https://mopsov.twse.com.tw/mops/web/bfhtm_q2.
For implementation status, please refer to Market Observation Post System > Single Company > Equity Changes/Securities Issuance > Fundraising > Implementation of Fundraising Plans, website: https://mopsov.twse.com.tw/mops/web/bfhtm_q2.

2024 Cash Capital Increase

1. Plan Details

(1) Date and reference number of approval from the competent authority: August 7, 2024, Taiwan Stock Exchange Corporation letter No. 1130014217
(2) Total amount of funds required for this plan: NT$787,511 thousand.
(3) Source of funds: This cash capital increase involves issuing 9,263,625 shares, each with a par value of NT$10. The minimum underwriting price for competitive auction is NT$67.80 per share, with priority given to bidders offering higher prices, and each successful bidder shall subscribe according to their bidding price. The public offering price is NT$87.33, calculated as the weighted average of the prices and quantities of all successful bids. However, since this average price is higher than 1.18 times the minimum underwriting price, the public subscription underwriting price is set at NT$80 per share, issued at a premium.

(4) Plan items and scheduled fund utilization progress

Unit: NT$ thousand

Plan Item	Expected Completion Date	Total Funds Required	Scheduled Fund Utilization Progress
			Q3 2024
Replenishment of Working Capital	Q3 2024	787,511	787,511

(5) Expected Potential Benefits:

The total amount of the current fundraising plan is NT$787,511 thousand, which will be entirely used to replenish working capital for future business development, to maintain the Company's competitiveness, ensure long-term stable operations, and provide positive benefits for business operations and financial structure optimization.

(6) Changes to the plan content, sources and uses of funds, reasons for changes, benefits before and after changes, and the date when the changed plan was submitted to the shareholders' meeting: Not applicable.

(7) Date of input into the information reporting website designated by the Financial Supervisory Commission: August 7, 2024.

Implementation Status

Unit: NT$ thousand

Plan Item	Implementation Status		Q3 2024	Reasons for Ahead of Schedule or Delay
Repayment of Bank Loans	Expenditure Amount	Expected	787,511	As Planned and On Schedule Completed
		Actual	787,511
	Implementation Progress	Expected	100%
		Actual	100%

Evaluation of Implementation Benefits

The purpose of this capital increase conducted by the Company is to strengthen working capital, with the expected benefit being to maintain stable operations and strengthen the financial structure. The Company has fully invested in strengthening working capital after completing the fundraising in September 2024, and has improved indicators such as debt ratio, long-term capital to property, plant and equipment ratio, current ratio, and quick ratio. Therefore, the actual achievement of this cash capital increase is consistent with the originally expected benefits, and there are no significant abnormalities.

Unit: NT$ thousand

| Itemst | | Year | September 30, 2024
(Q3 2024) | June 30, 2024
(Q2 2024) |
| --- | --- | --- | --- | --- |
| Basic Financial Information | Current Assets | | 1,255,490 | 848,540 |
| | Current Liabilities | | 633,093 | 986,974 |
| | Total Liabilities | | 1,829,562 | 2,290,493 |
| | Operating Revenue | | 1,401,003 | 999,296 |
| | Operating Net Income | | 417,877 | 262,848 |
| | Interest Expense | | 25,993 | 17,904 |
| | Earnings Per Share (NT$) | | 4.00 | 2.56 |
| Financial Structure | Debt to Asset Ratio | | 40.74% | 56.50% |
| | Long-term Capital to Property, Plant and Equipment Ratio | | 130.19% | 104.70% |
| Debt-Paying Ability | Current Ratio | | 198.31% | 85.97% |
| | Quick Ratio | | 192.11% | 81.62% |

Source: Financial reports reviewed by accountants.

IV. Operational Overview

1. Business Content

(1) Business Scope

Main contents of business operations:

The Company's main business items include comprehensive treatment of industrial waste incineration for power generation, recycling of mercury from mercury-containing waste, thermal pyrolysis treatment for recovering precious metals, recycling copper from waste printed circuit boards, and environmental remediation engineering. Through these technologies and green energy solutions, waste is transformed into useful resources, reducing negative environmental impacts.

Business Proportion of Main Products

Unit: NT$ thousand; %

| Year
Product Items | 2023 | | 2024 | | 2025 | |
| --- | --- | --- | --- | --- | --- | --- |
| | Amount | Proportion (%) | Amount | Proportion (%) | Amount | Proportion (%) |
| Waste Treatment Services | 919,926 | 72.29 | 978,288 | 56.99 | 890,841 | 77.10 |
| Copper Powder and Other Product Sales | 145,284 | 11.42 | 191,984 | 11.18 | 222,106 | 19.21 |
| Environmental Remediation Projects | 206,659 | 16.24 | 544,557 | 31.72 | 39,230 | 3.40 |
| Others (Note) | 588 | 0.05 | 1,916 | 0.11 | 3,331 | 0.29 |
| Total | 1,272,457 | 100.00 | 1,716,745 | 100.00 | 1,155,508 | 100.00 |

Note: Other income includes commission service income, environmental education income, etc.

Current Products (Services) Items

Service Items	Content
Industrial Waste Removal and Treatment	Industrial waste removal services, as well as incineration, physical, chemical, solidification, distillation, pyrolysis, and other treatment or recycling processes.
Recyclable Treatment	Waste Lighting Source Recycling and Treatment Services
Environmental Remediation Projects	Soil and groundwater remediation work for contaminated sites
By-product Sales	Sales of copper powder from mixed waste hardware, mixed metals containing precious metals, and other single metals, as well as CLSM and other recycled products.

Newly Developed Products (Services) in Planning

Project Classification	Newly Developed Products (Services) in Planning
Low-carbon circular economy, energy recovery, and resource recycling technologies	1. Improve heat recovery power generation efficiency and reduce external electricity consumption.
2. Promote the ISO 50001 Energy Management System and install energy-saving equipment.
3. Plan a wastewater recycling and treatment system to improve water recovery rates.
4. Combine chemical treatment and thermal treatment methods to develop waste asbestos reutilization technology solutions, enhancing resource recovery benefits and reducing environmental risks.
Development of Full-Cycle Zero-Waste and Critical Material Purification Technologies	1. Reduce the derived waste generation from waste lighting sources to below 5%;
2. Continue to improve the resource recycling and reuse rate of waste lighting sources to exceed 95%.
3. Maintain zero emissions in the full cycle of waste printed circuit board recycling and treatment;
4. Develop and test metallurgical technologies such as acid dissolution, electrolysis, and melting to enhance the copper purity of recycled waste printed circuit boards to over 99%.
5. Apply pyrolysis carbonization technology to thermally treat spent lithium batteries, separating organic electrolytes from electrode materials, and further extracting valuable metals such as lithium, cobalt, and nickel to improve resource recovery efficiency.
6. Establish modular dismantling and fine-sorting technologies for waste solar panels to separate glass, silicon wafers, and metallic materials, recover critical raw materials, and reintroduce them into industrial supply chains, promoting resource circular utilization.
Net-Zero Transition and Green Innovation	1. Continue to promote environmental education. As of February 2026, a cumulative total of 881 environmental education courses have been held, with over 14,800 participants, strengthening corporate sustainability impact and community engagement.
2. Plan and test fly ash water-washing detoxification and resource recovery facilities, incorporating chemical precipitation and activated carbon filtration processes to ensure effluent water quality complies with discharge control standards, and propose an optimized treatment process.
3. Invest in the construction of a pilot plant for carbon capture and reutilization from incineration flue gas, and obtain an invention patent for 'Carbonation-Based Carbon Fixation Reaction Method and Apparatus' (Application No.: 113116244).
4. Establish a lifecycle management and circular economy service model for heaters and tobacco sticks. Deepen R&D in back-end tobacco product processing technologies, including physical treatment of heaters, chemical raw material recovery from cellulose acetate, and organic matter biogas power generation, forming a complete resource circulation loop.

(2) Industry Overview

Current Status and Development of the Industry

The Company upholds the management philosophy of "Utilization for Public Welfare," transforming waste into useful resources and energy while reducing environmental damage. Established a comprehensive treatment center integrating incineration power generation, solidification, chemical, and other treatment mechanisms at Chung Tai Plant 1, combined with Chung Tai Plant 2's distillation recovery of mercury and thermal pyrolysis recovery of precious metals, as well as Chung Tai Plant 3's full-cycle zero-waste copper metal recycling, to build Chung Tai Resource Technology's "Energy Resource Integration Value Chain" system. This comprehensively recycles and processes waste resources from electronics-related industries, chemical industries, and other manufacturing industries, as well as medical and residential/commercial sectors, transforming them into resources and energy, providing all-round resource recovery solutions, and striving to become a model for the circular economy framework. The following is an explanation of the current status and development of industries related to the Company's business operations and services:

(1) Global Waste Treatment Industry Overview

According to the definition by the Organisation for Economic Co-operation and Development (OECD), waste management refers to the process of handling products from production to post-use residuals, including the control, supervision, and regulatory management of waste collection, transportation, treatment, and disposal processes. Since these are products of economic activity, factors such as population size, lifestyle, industry, and urbanization all affect the types and quantities of waste. If improperly handled and returned to the environment, waste will seriously threaten human health, therefore requiring strict management. On the other hand, if waste is effectively treated, recycled, and reused, it not only reduces harm to the environment and health but can also further extract valuable resources such as paper, plastic, and metals, thereby reducing the cost of remanufactured products and consumption of production materials. This process also creates many job opportunities, promoting sustainable development in economic, social, and environmental aspects.

According to the latest World Bank report, What a Waste 3.0 (2026), the global waste management industry is at a critical turning point, presenting investors with enormous infrastructure and climate finance opportunities. Rapid increases in global waste volumes and management costs are driving demand for infrastructure investment. According to the report, global municipal solid waste generation reached 2.56 billion tonnes in 2022, and without proactive reduction and management measures, total waste volumes are projected to increase by 50% to a staggering 3.86 billion tonnes by 2050. In terms of financial costs, the direct operational costs of global waste management

exceeded USD 250 billion per year in 2022, and are estimated to rise to USD 426 billion per year by 2050 under a business-as-usual scenario. However, the hidden economic losses caused by improperly managed waste—such as health damage, infrastructure destruction, and losses to the tourism industry—far exceed these figures. To address this crisis, it is estimated that between 2022 and 2050, global waste management infrastructure will require massive investment of USD 2.8 trillion to USD 3.4 trillion, a funding gap that will be heavily reliant on private sector participation and capital injection.

Climate change and carbon market mechanisms are injecting innovative financial returns into the waste industry; waste management has become one of the core industries in global climate change mitigation. In 2022, greenhouse gas emissions from global solid waste management activities reached 1.28 billion tonnes of $\mathrm{CO}_{2}$ equivalent per year, primarily methane generated from the decomposition of organic waste. Currently, 156 countries worldwide have incorporated waste management into the emission reduction targets of their Nationally Determined Contributions (NDCs) under the Paris Agreement. This enables advanced waste treatment enterprises to benefit significantly from global carbon market mechanisms (such as the Clean Development Mechanism (CDM) and Article 6 of the Paris Agreement). By collecting landfill gas, converting waste to energy, and improving recycling rates, companies can not only reduce greenhouse gas emissions but also convert emission reduction outcomes into Carbon Credits or emerging Plastic Credits for trading. This innovative business model combining climate finance will provide environmentally compliant treatment companies with stable and diversified additional revenue streams.

Due to their content of various hazardous substances and complex compositions, e-waste, if improperly handled, can cause significant impacts on environmental quality and public safety, particularly in regions with relatively limited resources and processing capacity, where the negative effects are even more pronounced. Compared to general waste, e-waste cannot be handled through conventional landfilling or simple disposal methods; it requires specialized treatment facilities capable of precision disassembly, chemical neutralization, and incineration. This has also driven the environmental industry to gradually develop toward higher technical barriers and professional specialization, stimulating market demand for e-waste recycling and metal resource recovery. Based on international trend observations, e-waste generation is highly positively correlated with a country's level of economic development; per capita generation is significantly higher in high-income countries, and e-waste has become an increasingly important component of municipal solid waste, indicating that future treatment demand will continue to rise. On the policy front, governments of various countries are also pushing for Extended Producer Responsibility (EPR) systems, shifting the responsibility for recycling and

disposal of electronic products throughout their full lifecycle back to manufacturers. E-waste has become one of the key regulated items under EPR frameworks. Overall, e-waste management is not only an important issue in environmental governance, but also a key driver for the development of the environmental protection industry and resource recycling.

Public-Private Partnerships (PPP) and integrated professional services are becoming the mainstream model of the future. Looking ahead, waste management has evolved from a simple public service into an innovation-driven, technology-intensive integrated service industry that relies on Public-Private Partnerships (PPP). Currently, approximately 50% of waste services worldwide are operated by private enterprises, and in the high-value-added field of 'treatment and disposal,' the participation rate of the private sector (including mixed operations) exceeds 50% (of which purely private operations account for 34% to 36%). As processing technologies advance toward automation and intelligence (such as IoT monitoring, optical sorting, and robotic sorting), governments and large enterprises will increasingly rely on professional environmental service providers with economies of scale and technological advantages. The continuously growing volume of waste and circular economy policies will enable waste management companies to focus on converting waste into high-value recycled materials or clean energy. This not only ensures robust growth in the global waste management market, but will also deliver investment returns that combine ESG sustainability value with long-term stable profitability for investors.

(2) Overview of Taiwan's Waste Treatment Industry

With the rise of environmental awareness, Taiwan has successively established various policies and measures for waste treatment. In 1984 and 1991, the "Urban Garbage Treatment Program" and "Garbage Treatment Program" were respectively formulated, establishing a waste treatment model primarily focused on incineration, with landfill as a supplementary method. According to Article 2, Paragraph 2 of the Waste Disposal Act, "industrial waste" refers to waste produced from business activities that is not generated from the daily lives of employees, including hazardous industrial waste and general industrial waste; "general waste" refers to waste other than industrial waste.

Pre-treatment includes compression processing, sorting, drying, and dewatering processes, with the aim of recycling valuable materials from waste to achieve reduction and resource recovery; intermediate treatment involves processing pre-treated waste through physical, chemical, biological, or thermal methods to make it stable, harmless, safe, and reduced in volume for storage, transportation, recycling, or disposal procedures; final treatment is the ultimate disposal of residual materials after pre-treatment and intermediate treatment, returning them to water bodies or land, including stable landfill, sanitary landfill, closed landfill, and ocean disposal.

In recent years, driven by net-zero transition and circular economy policies, the domestic environmental protection industry has continued to develop toward higher value-added and more specialized operations. The government has promoted the Resource Circulation Promotion Act and related regulatory amendments to strengthen waste management, resource reuse, and digital traceability mechanisms. It has also encouraged the domestic retention of rare metal recovery and the establishment of a complete circular economy industrial chain, driving steady growth in demand for waste treatment and resource regeneration. In addition, as the frequency of extreme climate events increases, the demand for post-disaster treatment of asbestos building materials, waste, and silt has risen significantly. The government has also continued to invest in post-disaster environmental restoration and the establishment of waste disposal systems, further expanding the market scale of environmental engineering and waste treatment.

On the policy front, through promoting waste-to-energy, resource recovery, and circular utilization, as well as establishing cross-ministerial resource circulation alliances and industry cooperation mechanisms, the government is fostering upgrades in environmental technology and innovation in business models, while also enhancing incentives for private enterprise participation. On the other hand, as national carbon reduction targets and carbon fee mechanisms are progressively implemented, corporate demand for low-carbon processing, waste reduction, and resource reuse is increasing, which will further strengthen the competitive position of treatment operators with compliance capabilities and technological advantages. Overall, driven by policy support, climate change, and resource circulation trends, the environmental protection industry possesses long-term growth momentum in market demand, and the industrial structure is also shifting toward high-barrier, technology-oriented, and integrated service development.

A. Industrial Waste Industry

As Taiwan's economic development is primarily driven by manufacturing and export processing industries, general industrial waste removal services account for the largest proportion of the waste management industry, reaching about 30%. Since 2019, under the trend of Taiwanese businesses returning home, industrial and commercial development has been rapid, with continuous innovation and research in high-tech products. The number of established businesses and economically active population has also increased. Benefiting from favorable factors such as the ongoing US-China trade war, significant domestic pandemic prevention results, and the global pandemic easing, Taiwan's manufacturing export orders have been booming. With the manufacturing industry thriving, the generation of industrial and general waste has grown accordingly. Domestic landfills can no longer accommodate the rapidly increasing amount of waste, and the hazardous and toxic nature of harmful industrial waste cannot be addressed

by traditional landfill methods. Therefore, it can be expected that the number of waste treatment service facilities and the tonnage of waste processed will increase daily due to growing demand.

According to the 2024 industrial waste declaration statistics report issued by the Ministry of Environment, Taiwan generated approximately 19.83 million tons of industrial waste domestically in 2024, including 18.22 million tons of general industrial waste, accounting for 91.86%, and 1.61 million tons of hazardous industrial waste, accounting for 8.14%. Over the past 5 years, incineration accounted for the highest proportion of industrial waste treatment in 2020, while physical treatment has risen to first place since 2021. From 2022 to 2024, the amount of industrial waste generated has shown a generally steady decreasing trend, with a reduction of 210,000 metric tons compared to 2023, indicating that domestic processing capacity is still sufficient. With the promotion of industrial resource recycling in recent years, industrial waste is now primarily handled through circular utilization methods, with the reuse rate rising from 75% in 2018 to 83% in 2024. In the future, the effective recycling and regeneration of resources will continue to be promoted to establish a society of sustainable resource utilization. According to data from the Industrial Waste Management and Resource Recovery Information Network, the 2025 reuse status and output value analysis shows that the resource recycling industry's output value reached NT$81.44 billion, indicating stable development of the industrial waste treatment industry focused on resource circular utilization.

Industrial Waste Treatment Status Over the Past Five Years

Unit: metric ton

Treatment Method Year	Amount Generated	Thermal Treatment (excluding incineration)	Incineration Treatment	Physical Treatment	Solidification Treatment	Chemical Treatment	Other Treatment	Landfill Treatment		Resource Reuse
								Self/Interim Treatment	Final Organization Treatment
2020	20,030,414	408,292	1,108,005	935,483	56,131	97,999	314,744	106,558	69,253	16,938,320
2021	21,950,312	421,600	1,021,338	1,049,614	67,386	142,809	318,836	75,698	81,950	18,741,702
2022	21,178,033	421,494	972,230	1,182,229	55,894	147,586	244,995	74,744	74,136	17,766,507
2023	20,038,745	393,719	935,35	1,402,597	44,853	140,302	141,920	133,999	47,440	17,112,427
2024	19,833,117	405,120	965,2611	1,651,710	42,029	161,888	175,838	70,481	40,913	16,482,500

Data Source: 2024 Industrial Waste Declaration Volume Statistical Report from the Ministry of Environment.

The declared volume of medical institution waste has shown an increasing trend over the years, with approximately 12% of medical institution waste being reused, while the remainder is primarily treated through incineration. In 2023, medical institutions generated approximately 140,000 metric tons of waste, of which about 66% (100,000 metric tons) was general waste and general industrial waste (with approximately 90,000 metric tons treated through incineration), and about 34% (40,000 metric tons) was hazardous

industrial waste in the form of biomedical waste (with approximately 30,000 metric tons treated through incineration).

As Taiwan officially enters a 'super-aged society' in 2026, the total volume of medical waste is expected to surpass the record of 140,000 metric tons set in 2023, showing a trend of continued and stable growth. General waste proportion: Continues to account for approximately 65–70%, including large quantities of single-use medical supplies, packaging, and administrative office waste. Biomedical waste: Due to the increase in precision medicine and invasive treatments, the volume of waste sharps and infectious waste handled remains at a high level.

In July 2025, the Ministry of Environment allocated a special budget of approximately NT$800 million specifically for the removal and disposal of approximately 15,000 tonnes of asbestos waste generated in the aftermath of typhoon disasters. This was implemented in parallel with regular subsidies, alongside the issuance of the 'Guidelines for the Removal and Treatment of Asbestos Building Material Waste After Natural Disasters,' reminding the public and cleanup personnel to observe protective measures. Local governments were also directed to establish dedicated asbestos waste storage areas for centralized temporary storage. Damaged asbestos tile waste was transported and processed by qualified contractors to reduce environmental and health risks, while illegal dumpers were strictly investigated and penalized in accordance with the Waste Disposal Act.

The United Nations Minamata Convention on Mercury officially came into effect on August 16, 2017. Although Taiwan is not a party to the convention, it has examined international mercury management and implementation status to plan its regulatory direction in alignment with the international convention's regulatory items and timeline. Through inter-ministerial cooperation, Taiwan jointly developed the "Implementation Plan for the United Nations Minamata Convention on Mercury" (approved by the Executive Yuan on June 27, 2016), establishing the division of responsibilities among ministries as the basis for promoting domestic mercury management. In 2023, the Ministry of Environment's Chemical Bureau completed the compilation of annual implementation results from various ministries and published them on the Minamata Convention on Mercury information website.

The Ministry of Environment actively promotes the appropriate application of inorganic recycled aggregates through various measures, including proper policy guidance, regulatory frameworks, technical research to improve quality, and economic incentives. These efforts maximize the circular value of aggregates and achieve resource recycling goals. The main reuse applications include road engineering, controlled low strength material (CLSM), cement raw materials, and port area filling.

To strengthen the management of Solid Recovered Fuel (SRF), the mercury content product standards have been made more stringent with reference to international ISO standards, and an SRF product classification system has been established. A product history control mechanism has been established to track product flow. Strengthening manufacturing plant reviews through three substantive review stages—document review, field inspection, and trial operation—as well as review by specialized technical teams to ensure that manufactured SRF complies with relevant regulations. Strengthening air pollution emission management for user facilities, regulating facilities that use SRF as fuel and the air pollution prevention equipment they should have, with the Ministry of Environment's Department of Air Quality Protection establishing air pollution emission standards for resource recycling fuels. The Ministry of Environment formed an "SRF Operation Inspection and Guidance Team" on June 17, 2024, and from mid-June conducted a comprehensive three-month inspection and guidance for all 66 manufacturing and user facilities nationwide (48 manufacturing plants and 18 user facilities). The guidance operation was completed on September 13, 2024, and the inspection report was published on October 9, 2024. The Ministry of Environment officially promulgated the 'Regulations Governing the Reuse Management of Common Industrial Waste as Raw Materials for Solid Recovered Fuel' on December 30, 2024. Manufacturers are now required to obtain a reuse permit or comply with the registered checklist requirements; otherwise, they will face penalties under the Waste Disposal Act.

Entering 2025, the policy focus has shifted toward the international alignment of emission controls and product standards. In January 2025, the Ministry of Environment officially implemented the amendments to the 'Six Air Pollution Control Acts,' tightening dioxin and heavy metal (lead, cadmium, and mercury) emission standards for boilers using SRF. In April 2025, the SRF White Paper was officially published, establishing a product grading system and the principle of 'matching materials to appropriate applications.' It requires manufacturers to conduct quality classification in accordance with the ISO 21640 standard, and explicitly outlines an industry phase-out mechanism and a 2030 transition roadmap, thereby establishing a credible regulatory environment for 'waste-to-energy.'

B. Waste Lighting Industry

The waste lighting recycling and processing business requires certification in waste lighting dismantling techniques and mercury recovery processing. It processes waste fluorescent tubes and light bulbs for resource recovery, achieving the goals of separation, detoxification, and resource recovery, while producing derivatives for resource reuse. These derivatives primarily include glass, fluorescent powder, various metals, and mercury.

According to the "Announced Recyclable Waste (Waste Lighting) Historical Recovery Data" from the Ministry of Environment's Resource Circulation Administration, Taiwan's waste lighting processing volume from 2018 to 2025 has shown a decreasing trend since 2019. This indicates that the market has gradually accepted more energy-efficient and durable LED lighting products. Additionally, as governments worldwide develop stricter energy-saving and environmental protection policies for lighting, the growth rate of energy-efficient LED lighting products will continue to increase, while the use of traditional fluorescent tubes has gradually declined. According to the Industrial Technology Research Institute's report on the rise of LED lighting, LED products have accounted for over 50% of the global lighting market since 2020, and are estimated to reach over 80% market share by 2026, while the proportion of waste incandescent bulbs and fluorescent tubes will decline year by year.

In recent years, due to the international trend of mercury limitation and the development of lighting sources toward energy conservation, traditional lighting has gradually been replaced by LEDs, resulting in reduced recycling volumes that make processing operations financially unsustainable. To facilitate recycling and processing channels, a revision to increase the subsidy rates for traditional lighting was announced on December 30, 2022, and implemented from January 1, 2023.

Data on Recyclable Waste (Waste Lighting) Recovery Volume for the Past Five Years

Unit: Kilogram

Year	2021	2022	2023	2024	2025
Waste Lighting Category	3,294,267	2,799,970	2,752,172	2,738,112	2,862,552

Source: Resource Recycling Network, Resource Circulation Administration, Ministry of Environment.

C. Waste Printed Circuit Board Industry

Taiwan is currently a global hub for electronic industry development. With the flourishing development of 5G, high-performance computing, cloud, IoT, automotive production capacity expansion and other industries, the replacement speed of electronic products is accelerating. Since all electronic devices contain one or more printed circuit boards, waste printed circuit boards account for a significant proportion of electronic waste. Improper handling of waste printed circuit boards may cause environmental pollution and biological health hazards. Therefore, the treatment of waste electronic products has become a focus of environmental protection policies in various countries. The optoelectronics and semiconductor industries are booming, and the government has listed the resource recycling industry as one of the top ten emerging industries.

From the recycling and processing of waste materials from major PCB manufacturers, valuable waste copper is the main component. The issue of copper metal recycling and reuse has gradually gained worldwide attention, driven by both market supply and demand. On the demand side, copper recycling and regeneration helps reduce energy consumption and lower carbon dioxide emissions. On the supply side, as the grade of natural copper mining gradually declines, the copper content in natural copper ore is only about 0.5% to 2.0%. In comparison, the copper content in common electronic waste is more efficient for smelting than natural mineral sources, prompting the industry to consider increasing the proportion of recycled copper usage. Therefore, copper recycling and regeneration has become an important global industrial trend.

Taiwan produces a large amount of waste printed circuit boards (PCBs) every year, with sources including discarded circuit boards from electronic products and trim materials from the PCB manufacturing process. According to statistics, between 2017-2018, the total amount of formally recycled waste electronic equipment in Taiwan averaged about 135,000 tons annually, with a significant portion containing PCB components. Since PCBs contain abundant metals (such as copper, gold, silver, etc.), the main purpose of recycling and processing is to extract and reuse these valuable metals. In fact, recycling 1 ton of waste circuit boards can recover metals worth approximately NT$84,000, indicating that waste PCBs have considerable resource value. It is worth noting that the actual amount of electronic waste generated in Taiwan is far higher than the amount formally recycled. Some electronic products (such as mobile phones, etc.) are not included in legally mandated recycling items, resulting in some electronic waste containing PCBs potentially flowing into informal channels or being stored. Furthermore, with the widespread use of electronic devices, the generation of electronic waste shows an increasing trend year by year; research estimates that approximately 340,000 tons of electronic waste are generated annually.

Strengthening the recycling and processing of waste PCBs has become a focus of environmental protection departments, to prevent the loss of valuable metal resources and environmental pollution. Taiwan's waste PCB recycling and processing industry has already formed a considerable scale. The amount of waste electronic equipment (including PCBs) processed each year reaches hundreds of thousands of tons, supporting a market scale of several billion New Taiwan dollars (estimated from the value of recycled metals). Processing operators must all obtain government permits and follow environmental protection standards for processing, forming a legal recycling and processing system. Since PCBs contain harmful substances such as lead and cadmium, operators need to ensure proper pollution prevention (such as wastewater treatment, smoke and dust

collection) during the recycling process. In the early period, Taiwan lacked complete smelting facilities, and some PCB residues needed to be exported for processing or were illegally disposed of by unscrupulous operators; for example, between 2016 and 2019, there was a case in Pingtung where approximately 2,286 tons of crushed PCB fiberglass powder were illegally dumped, causing copper content in the soil to exceed standards. This incident highlights the importance of strengthening supervision and implementing legal processing. Taiwan has a policy and regulatory framework of the "Waste Disposal Act" for the management of waste PCBs, ensuring that the recycling and processing process meets environmental protection requirements.

In recent years, the Taiwan government has actively integrated the concept of circular economy into waste PCB management policies, promoting sustainable resource utilization. At the policy level, the Environmental Protection Administration and related ministries have launched the "Circular Economy Action Plan," encouraging manufacturers to strengthen research and development of waste resource recovery technologies. In addition to regulatory adjustments, the government also promotes industry-academia-research collaboration and innovation. The Environmental Protection Administration collaborates with colleges and universities, research institutions, and the industry to develop advanced electronic waste recycling technologies, in order to improve resource recovery efficiency and reduce environmental impact.

The recycled copper price has shown a long-term high correlation with international copper futures prices (such as the London Metal Exchange LME, New York Mercantile Exchange COMEX). In 2025, the international copper market experienced a pivotal year of transition from a 'cyclical upturn' to 'structural scarcity.' Driven by the expansion of AI data centers, large-scale upgrades to global power grids, and the continued rise in electric vehicle penetration rates, copper demand saw explosive growth. At the same time, supply shocks caused by production cuts at key mines and processing fees falling to negative values drove international copper prices above the previously anticipated threshold of USD 10,000 per tonne. The LME copper futures annual average price rose to a range of USD 10,000 to 12,000 per tonne, while COMEX copper prices also repeatedly reached the historic high of USD 5.5 per pound. Looking ahead to 2026, the market has entered a new normal driven by the twin engines of 'energy transition' and the 'wave of digitalization.' According to the latest forecasts from investment banks (March 2026), despite potential short-term volatility caused by high prices suppressing downstream restocking and geopolitical tariff variables, the copper concentrate supply deficit is expected to persist. J.P. Morgan and Goldman Sachs both estimate that the LME annual average price will

fluctuate between USD 12,000 and USD 13,500 per ton, with the potential to reach USD 15,000 in extreme scenarios.

The secondary copper market demonstrated unprecedented strategic value in 2025–2026. Secondary copper prices have risen in tandem with futures market trends, and as copper smelters have become significantly more reliant on secondary resources (recycled copper) due to extremely tight concentrate supply, the premium for secondary copper has remained elevated. Furthermore, driven by environmental regulations across various countries and growing demand for ‘low-carbon copper,’ recycling enterprises equipped with high-efficiency separation technologies (such as copper recovery from electronic waste) have become core components of the supply chain. It is expected that by 2026, secondary copper will no longer serve merely as a supplementary raw material, but will instead become an important strategic reserve for countering geopolitical supply risks.

D. Soil and Groundwater Environmental Remediation Engineering Industry

After the Soil and Groundwater Pollution Remediation Act (hereinafter referred to as the Soil Pollution Act) was amended in 2010, it significantly stimulated demand for land pollution-related services. In the bidding projects announced by the Environmental Protection Administration for investigating contaminated land in various regions, after investigation, contaminated land will be subject to administrative control, public announcement, and restrictions on land use (prohibited from development, establishment, and transfer), and relevant responsible parties will be compelled to carry out soil pollution remediation operations. For land where pollution remediation is not voluntarily implemented, the Soil and Groundwater Pollution Remediation Fund will invest resources, ultimately achieving the purpose of soil restoration and reuse. In response to the aforementioned soil pollution remediation processes, related demands for soil pollution remediation services have emerged, such as: soil pollution investigation and testing operations, soil pollution remediation and site management, soil restoration and resource-oriented reuse.

Compiling the accumulated number of controlled sites over the years, the number of delisted sites, and the current number of controlled sites, the number of sites under control in the current year has gradually decreased since 2017, while the accumulated number of delisted sites has shown an increasing growth rate since 2015, with the growth rate showing a slowdown in 2021 (the average annual number of delisted sites from 2015 to 2024 is 582).

Source: 2024 Annual Report on Soil and Groundwater Pollution Remediation

Sales Revenue of Pollution Remediation Industry in the Past Five Years
Unit: NTD 100 million

Year	2021	2022	2023	2024	2025
Pollution Remediation Industry	142.99	155.68	155.57	186.29	189.21

Data Source: Ministry of Finance Statistical Database.

According to the research report from the Industrial Economics Database of Taiwan Institute of Economic Research, pollution remediation companies have benefited from the recent expansion actions of domestic technology companies, which have increased the demand for land use in Taiwan, driving up the number of pollution site remediation projects. In order to control polluted soil and prevent it from flowing to unknown destinations, in the past, there was a tendency not to transport polluted soil off-site, instead using in-situ or on-site treatment methods; or if it was transported off-site, the polluted soil was treated as waste, undergoing removal, solidification, and landfilling, which was expensive and had no other added value. However, after years of remediation experience, it has been discovered that in-situ and on-site treatment of contaminated soil has limitations, high control costs, the treatment process easily causes secondary pollution, and there are various problems such as poor cooperation from landowners. Therefore, in recent years, the policy direction of the Environmental Protection Department has been to remove contaminated soil and transport it to soil rehabilitation plants for ex-situ treatment, and to reuse soil resources that meet various pollutant control standards after treatment.

Subsequently, these can be resold through the soil resource industry, deriving added value from soil pollution remediation. With the gradual increase in environmental awareness in Taiwan and the demand for land for urban development, the overall environmental protection market continues to rise. Recently, the demand for projects from related public tenders and private enterprises has been gradually increasing. In addition to the increase in the overall market case volume, there is also a growing trend in the amount of individual project cases.

Relationship between upstream, midstream, and downstream industries

The industry to which the Company belongs is the circular economy value chain. The relationship between upstream, midstream, and downstream industries is presented according to material sources, the Company's recycling and treatment technologies, and resource-converted products:

物料來源	高科技、化工、醫療等所產生廢棄物	廢棄照明(傳統螢光燈管、電子業曝光燈等)、含貴重金屬複合材料	電子零組件、半導體、印刷電路板業等所產生下腳料、邊框等)
回收處理技術	焚化、化學、洗淨、固化等處理	破碎、蒸餾、熱脫附、熱裂解等處理	乾、濕破碎、水搖床分選、改質
資源化產品	電力再生粉料CLSM水泥塊製品	高純度汞玻璃粒料品貴重金屬	高純度鋼粉混凝土掺料

Future development trends and competitive situation of products

(1) Removal and treatment of industrial waste

A. Development trend: After the "Paris Agreement" was signed and became international law, "energy conservation, emission reduction, and circular economy" have become a common international language. Under the inevitable depletion of limited Earth resources, the prices of new resources become more valuable due to their scarcity, creating pressure for continuously rising prices. In the future, environmental awareness will be highly accepted by countries worldwide. After reviewing the mature models of countries that have already implemented high-level environmental protection policies, the environmental protection industry will become an indispensable and important link in human life. The government has therefore actively strengthened the guidance of public and private waste disposal organizations, significantly simplified regulations, and increased incentives to encourage private institutions to invest in the waste treatment industry, with the aim of improving the proper treatment rate of domestic industrial waste.

B. Competitive situation: The number of established businesses and population continues to increase, leading to a relative growth in the generation of industrial waste and general waste. Domestic landfills can no longer accommodate the rapidly expanding quantity of waste. Among these, the hazardous and toxic industrial waste cannot be resolved through traditional landfilling. Therefore, it can be expected that the demand for waste treatment service facilities and processing tonnage will increase daily due to this need. Furthermore, given Taiwan's dense population and limited land resources, the high-efficiency and diversified treatment plants operated by the Company represent the current best and fastest solution to waste management problems.

(2) Treatment of recyclable materials

A. Development trend: The types of lighting sources used in our country can be divided with 2009 as a watershed. Development trend: Prior to 2009, traditional light sources were predominant, including fluorescent tubes (including T12/T9/T8/T5), energy-saving light bulbs, mercury lamps, metal halide lamps, high-pressure sodium lamps, etc. During this period, lighting products followed past lighting usage habits (where fixtures and light sources could be separated), so after installing a light fixture, if the light source was damaged, a replacement light source could be purchased. After 2009, LED lighting emerged, and our country's lighting market began to change. The rapid price drop and high-efficiency characteristics of LED lighting products have driven market growth, with some products already becoming mainstream in the market, causing the market share of traditional lighting products to gradually decline. In addition, integrated LED

lighting products have entered the market with advantages such as small size, long lifespan, and better energy-saving benefits. Examples include LED street lights, LED spotlights, LED recessed lights, and LED floodlights, all of which adopt an integrated design. When these types of products are damaged, the entire fixture must be replaced directly. Although this changes the habit of replacing light sources, due to their higher cost-performance ratio, they have gradually been accepted by the market and become mainstream (Industrial Technology Research Institute, 2021/1/15).

B. Competition situation: The Company's recycling and processing of waste lighting sources is currently an oligopolistic business in Taiwan. The Company has obtained qualified processing credentials in accordance with the "Management Measures for Recyclable Waste Recovery and Treatment Industry," the "Management Measures for Application and Review of Recyclable Waste Recovery, Removal, and Treatment Subsidies," and the "Operation Manual for Recyclable Waste Recovery, Removal, and Treatment Verification and Certification (Waste Lighting Sources Category). The recycling process of waste lighting sources aims to achieve the goals of separation, detoxification, and resource recovery, as well as producing various types of recovered materials. In 2025, the processing volume market share approached 50%. The Company will continue to increase the resource recycling and reuse ratio of waste lighting sources to over 95%, maximizing waste reuse.

The Company's second plant processes recyclable waste lighting sources and has obtained qualified processing credentials in accordance with the "Management Measures for Recyclable Waste Recovery and Treatment Industry," the "Management Measures for Application and Review of Recyclable Waste Recovery, Removal, and Treatment Subsidies," and the "Operation Manual for Recyclable Waste Recovery, Removal, and Treatment Verification and Certification (Waste Lighting Sources Category). The recycling process of waste lighting sources aims to achieve the goals of separation, detoxification, and resource recovery, as well as producing various types of recovered materials. The total processing volume from 2021 to 2025 was 9,685.9 metric tons. Through the resource recovery processing, materials such as mercury, glass, iron, and aluminum were produced, achieving a recycling rate of 90%.

(3) Mixed Waste Hardware Processing and Derivative Sales

A. Development Trend: Recycling and processing of scrap materials involves collecting excess materials, trimmings, etc. generated during the production process, which can be used for resource recovery. The larger the processing volume of mixed waste hardware, the greater the economic scale to effectively reduce costs; as the market demand for copper increases, the stability of raw material sources and processing to increase copper content will be favored by customers.

B. Competitive Situation: After the completion of the Company's third plant, it has obtained qualification as a Class A waste treatment facility, receiving copper-containing waste from domestic printed circuit board manufacturers. Using processes such as decomposition, dry crushing, wet crushing, and water table separation, the Company can recover copper powder with a purity of over 80%. The copper powder product is then resold to copper smelting manufacturers to be reprocessed into pure copper. The separated glass fiber resin is further processed through a modification procedure to produce "concrete admixture. The copper powder product is reprocessed into pure copper by copper smelting manufacturers, while the concrete admixture is used by the cement manufacturing industry, achieving the goal of complete recycling with zero waste. From 2023 to 2025, a total of 16,632 tons of waste printed circuit boards were processed; the recycled products of copper powder and concrete admixture totaled 24,746 tons, achieving a recycling ratio of approximately 100%. This business is one of the important sources of revenue for the Company; the selling price of copper powder is affected by international copper futures prices and exchange rates, so the Company adjusts the proportion of sales between domestic and foreign customers to diversify risk.

(4) Environmental Remediation Projects

A. Development Trend: The Company holds a professional environmental protection engineering construction license. After years of cultivation, in August 2023, we partnered with professional pollution remediation engineering company JABBO TECHNOLOGY CO., LTD. to jointly participate in the soil and groundwater pollution remediation project of the Kaohsiung CPC Refinery for the Kaohsiung City Government, with a contract amount of approximately NT$1 billion. After the completion of this soil and groundwater pollution remediation project, the land will be planned by the Kaohsiung City Government as an environmental protection facility site for an advanced semiconductor industry base. The Company and Jesper Co., Ltd. are working together to complete the site excavation project within 1 year, and to complete the on-site soil and groundwater pollution remediation project within the following year. The early completion of this project will help accelerate environmental improvement in Taiwan and meet the land requirements for the future semiconductor industry base ahead of schedule.

B. Competition Situation: The soil and groundwater environmental protection service business covers multiple fields from pollution investigation to subsequent improvement and remediation, including planning and design, on-site sampling, laboratory testing, equipment supply, on-site construction, engineer certification, and soil treatment facilities. There are several companies competing in each of these fields domestically.

(3) Technology and Research & Development Overview

Technology Level and Research Development of Business Operations

The Company is mainly engaged in domestic waste removal and treatment. In addition to focusing on technological capabilities for resource recovery and energy recovery processing, the Company also works with upstream and downstream operators to promote resource circular linkages, enabling recycled materials to smoothly flow downstream or return to the original manufacturing process in a closed-loop system. The Company continuously researches and develops higher-value materials for upcycling applications. The related business improvements are mainly implemented by site personnel based on actual existing conditions, with the President directly leading the R&D unit — "Circular Economy Innovation and Research Laboratory."

(1) Research and Development Personnel and Their Educational and Professional Background:

Unit: Number of People

Education	2024	2025	As of the end of March 2026
Doctorate	-	0	0
Master's Degree	1	1	1
College/University	1	1	0
High School (and below)	-	0	0
Total	2	2	1
Average Years of Service	10.5	11.0	17.7

(2) Research and development expenses invested annually in the past five years:

Unit: NT$ thousand; %

Items	2021	2022	2023	2024	2025
Research and Development Expenses	-	-	3,461	5,145	6,113
Net Operating Revenue	-	-	1,272,457	1,716,745	1,155,508
Percentage of Research and Development Expenses to Net Operating Revenue (%)	-	-	0.27	0.30	0.53

From 2021 to 2022, the Company focused on process improvements to provide new services to customers, but did not have a dedicated R&D budget or department, so no specific R&D expenses were allocated.

(3) Successfully developed technologies or products in the past five years

The Company's operational direction has expanded from the resource recycling of waste lighting sources, mercury-containing waste, and waste printed circuit boards to include the pyrolysis treatment of composite materials, comprehensive waste incineration, heat recovery power generation, and the reuse of incineration bottom ash. The Company continues to research and develop resource recycling technologies, develop processes that maximize resource recovery and reuse, and innovate green products and services to provide customers with comprehensive circular economy solutions.

Time	Important R&D Achievements	Description
2021	Optimal mix ratios for the application of incineration bottom ash in controlled low-strength materials (CLSM), recycled aggregates, and cement products	Commissioned the Taiwan Construction Research Institute to develop material recycling technology.
2022	Developing optimal mix ratios for the application of incineration bottom ash in CLSM, recycled aggregates, and cement products	Completed the optimal mix ratios for the application of incineration bottom ash in CLSM, recycled aggregates, and cement products.
2023	Sodium bicarbonate application in acid removal technology for exhaust gases	1. Established the optimal exhaust gas temperature range for sodium bicarbonate.
2. Set up sodium bicarbonate grinding and dosing equipment.
2024	Research, Analysis and Market Matching Plan for the Application of Industrial Waste Incineration Bottom Ash Recycled Aggregates	Analysis of recycled aggregate products applied as raw materials in engineering materials, and their reuse development as two products: "permeable bonding mortar" and "permeable bricks".
2025	Incineration Flue Gas Carbon Fixation System Upgrade and Transformation Plan	A flue gas carbon capture and utilization system was jointly developed with ITRI, and an invention patent for the 'Carbonation-Based Carbon Fixation Reaction Method and Device' was obtained (Application No.: 113116244).
Flue gas CO_{2} capture technology was developed and combined with fly ash washing liquid to produce light calcium carbonate, achieving the resource utilization of carbon dioxide.
	Water Resource Recycling and Reuse and Fly Ash Washing Water Treatment Process Testing	To reduce raw water demand and wastewater discharge, an inventory of various water use and drainage sources was conducted, and feasible recycling and reuse strategies were proposed to optimize the enterprise's water use processes, reduce treatment costs, and comply with the effluent standards of the environmental park.
For fly ash washing, given its characteristics of high salinity and heavy metal contamination, an optimized treatment process was proposed by integrating chemical precipitation and activated carbon filtration procedures.

(4) Long-term and short-term business development plans

Short-term business development plan

(1) Plant 1 Incineration Comprehensive Treatment Center Operations, Expanding the Company's Business Scale

In addition to actively pursuing the Company's original recycling and processing business for waste lighting sources, waste printed circuit boards, and composite material processing, the completion and commissioning of Plant One's incinerator in 2022 has added new treatment methods including incineration treatment, chemical treatment, and solidification treatment. These methods enable the Company to perform resource recovery processing according to the characteristics of various types of waste, expanding its service market and operational scale.

In response to the severe damage caused by Typhoon Danas to the Chianan region, the government launched an asbestos building material cleanup project. The Company participated in the downstream processing, driving new business in 2025, which is estimated to account for approximately 3.5% of revenue. Looking ahead to 2026, the Company will continue to deepen its professional capabilities in waste asbestos treatment, while simultaneously investing in waste asbestos resource recycling and reuse technologies, elevating the treatment process from 'end disposal' to 'circular material regeneration,' thereby increasing added value and long-term competitiveness. As of the end of March 2026, the revised reuse pilot plan review has been approved. Given the increasing frequency of extreme climate events and the rising intensity of relevant policies, waste asbestos project business in 2026 still presents opportunities for renewed growth.

(2) Strengthening Pollution Prevention and Improving Resource Recovery Efficiency

In response to the ongoing optimization of Plant 1's incineration treatment model, the Company has implemented comprehensive pollution prevention measures addressing environmental impacts such as derived waste, air pollution, wastewater, and noise, ensuring that all emissions comply with relevant regulatory standards and that environmental monitoring and proper treatment mechanisms are in place. Building on this foundation, the Company continues to invest in equipment upgrades and process formulation optimization to improve overall treatment efficiency and capacity, while deepening research and development in resource recovery technologies, promoting the high-value utilization of recovered products, enhancing the purity and added value of recycled copper, reducing the industry's reliance on imported raw materials, and further strengthening the Company's technological competitiveness and environmental performance.

(3) Improve financial structure and increase financing channels

To continuously generate stable operating funds and, in conjunction with diversified fundraising channels from financial institutions and capital markets, strengthen financial flexibility and market competitiveness.

(4) Deepening the Layout of Pollution Remediation Engineering and Expanding High-Barrier Market Opportunities

The Company continues to focus on the development of mercury-contaminated soil remediation projects, concentrating on long-term, large-scale public engineering projects with high technical barriers. In 2026, the Company will actively pursue large-scale pollution remediation contracts in accordance with the progress of policy-driven tenders. Chung-Tai integrates relevant resources and project management capabilities, and introduces relevant talent. The combination of high-level technical expertise with prior large-scale shooting range remediation experience helps Chung-Tai expand into public and private sector engineering markets and establish competitive advantages.

Long-term business development plan

(1) Monitor industry dynamics and keep abreast of domestic and international waste management policies.

As air pollution emission standards, regulations governing waste treatment by-products, and recycled materials become increasingly stringent, the industry has entered a phase of high-standard regulatory oversight; however, this has simultaneously driven growth in treatment demand and market scale. The Company will continue to monitor policy developments regarding new items designated for recycling and treatment by competent authorities, proactively invest in the research, development, and establishment of relevant treatment technologies, processes, and equipment, obtain treatment permits in a timely manner, and continuously expand its operational items and service scope.

In terms of international markets, as the global circular economy industrial chain integration accelerates, the Company will actively deepen cooperative relationships with international partners and expand its overseas market presence. Through collaborative development with strategic partners such as major Japanese refineries, the Company will progressively establish a cross-border professional division of labor system, enhance the added value of resource recovery and reuse, and strengthen long-term competitive advantages.

Overall, industry development will be driven by multiple factors including international metal price trends, the Extended Producer Responsibility (EPR) system, and Taiwan's 2050 net-zero and circular economy policies, which are expected to continue generating market opportunities. The Company will also simultaneously enhance its technical capabilities and environmental

standards to respond to the trend of increasingly stringent regulations and consolidate its competitive position in the industry.

(2) Continue to improve employee per capita contribution and enhance team cohesion

We plan regular employee training to enhance professional skills and work efficiency; additionally, we are gradually improving employee welfare systems and designing appropriate compensation mechanisms, adhering to the concept of sustainable operation, establishing corporate culture, and increasing employees' sense of identification with the company.

(3) Sound financial planning

The Company will continuously optimize its capital structure, actively expand sources of short- and long-term funding through the use of diversified financing instruments, so as to strengthen fund management capabilities and enhance financial flexibility. By appropriately balancing the allocation of debt and equity capital, the Company aims to reduce overall capital costs and enhance corporate value. At the same time, in alignment with the Company's long-term development strategy, various financing channels will be flexibly utilized to support operational growth and capital expenditure requirements. Under a prudent financial policy, the interests of shareholders, employees, and the general public are also taken into consideration, and the Company continues to share operating results with stakeholders through earnings distribution mechanisms.

(4) Long-Term Development Strategy and Phased Objectives

The Company continues to adopt "resource circulation and energy transition" as its core development focus, cultivating medium- to long-term growth momentum through strategic investments and technology deployment. In terms of investment, the Company has invested in Da Yuan Company Limited to promote the construction of a Solid Recovered Fuel (SRF) renewable energy power plant, which, combined with existing waste treatment operations, strengthens upstream and downstream integration benefits and generates operational synergies.

Regarding core competitiveness, the Company's existing treatment facilities have maintained excellent operational performance over the long term. Plant No. 2 and Plant No. 3 have been consecutively rated as Class A outstanding treatment facilities by local governments for multiple years, demonstrating the Company's stable and superior execution capabilities in pollution prevention, operational management, and regulatory compliance, which serve as an important foundation for expanding new businesses and undertaking large-scale projects.

In terms of technology development, the Company continues to collaborate with industry, government, and research institutions, investing in emerging waste recovery and treatment technologies with long-term market potential, including flue gas carbon capture technology development, spent lithium battery pre-treatment and material recovery, solar panel disassembly and material regeneration, as well as heated tobacco products and cigarette butt recycling and treatment, thereby enhancing both technical depth and breadth of application.

Overall, the aforementioned strategic deployments are all in growth markets driven by policy initiatives and the energy transition trend. The long-term objective is to continue advancing technology maturity verification, and upon meeting the conditions for scaling, to progressively introduce commercial operations, aligning with the trends of the resource circulation industry and forming a new wave of operational growth momentum for the Company.

2. Market and Production/Sales Overview

(1) Market Analysis

1. Main Product (Service) Sales (Provision) Regions

Unit: NT$ thousand; %

Year Sales Regions	2023		2024		2025
	Amount	Ratio (%)	Amount	Ratio (%	Amount	Ratio (%)
Domestic Sales (Taiwan)	1,158,372	91.03	1,560,111	90.88	1,027,003	88.88
Export Sales (Overseas)	114,085	8.97	156,634	9.12	128,505	11.12
Total	1,272,457	100.00	1,716,745	100.00	1,155,508	100.00

The Company's overseas sales business focuses on the Japanese market, with recycled copper as the main product.

2. Market Share

For the estimable waste treatment market, the Company's market share in the domestic market is disclosed as follows:

(1) Recycling and Treatment of Waste Lighting

After the Company's processing volume is audited by a third-party certification organization, the auditing certification body submits a processing certification volume report to the Environmental Protection Department, which the Company uses as the basis for requesting subsidy amounts. The processing volume from 2023 to 2025 totaled 4,897.6 metric tons, with a market share of approximately 50%. The market share in recent years has declined compared to the previous period, mainly because the rapid popularization of LED lighting has changed the market structure. The Company's second plant currently focuses on the processing of traditional fluorescent tubes. Based on business strategy considerations, it has not applied for a permit to recycle and process waste LED lights, which indirectly affects the overall market share performance.

Unit: metric ton

Items	2023	2024	2025
The Company's Recyclable Processing Volume	1,903.7	1,629.5	1,364.4
Total Nationally Certified Waste Lighting Source Processing Volume by the Environmental Protection Department	2,752	2,738	2,863
Market Share	70%	59%	48%

(2) Waste Printed Circuit Board Processing

The Company primarily processes Class E waste, including metal-containing printed circuit board waste and its dust, as well as waste printed circuit boards with attached components. Therefore, comparing the Company's recycling processing volume with the statistics reported by the Environmental Protection Department, the estimated market share is approximately 20% to 30%.

Unit: metric ton

Items	2023	2024	2025
The Company's Recycling Processing Volume	10,257	7,658	6,853
Reported Domestic Flow Volume of Industrial Waste (E-0221, E-0217, E-0222, E-0229)	32744	33391	34877
Market Share	31%	23%	20%

(3) Industrial Waste Incineration Treatment Process

The Company's First Plant is a comprehensive waste treatment center primarily focused on incineration treatment. The estimated market share based on the statistical report data on industrial waste declarations from the Ministry of Environment is as follows:

Unit: metric ton

Items	2023	2024	2025
The Company's Incineration Treatment Volume	25,676	27,854	Note 1
National General and Hazardous Industrial Waste Incineration Treatment Volume	935,340	965,261	Note 1
Market Share	2.7%	2.9%	Note 1

Note 1: The Ministry of Environment has not yet announced the incineration treatment statistical information for 2025.

Market's Future Supply and Demand Conditions and Growth Potential

Currently, our country's waste disposal policy is based on the governing principle of "Setting goals for resource sustainability, creating new opportunities through circular utilization," and has formulated resource recycling policy planning, moving toward sustainable resource utilization, advocating green production, green consumption, source reduction, resource recycling, reuse, and regenerative utilization methods to effectively circulate resources, gradually achieving the goals of complete waste recycling and zero waste. Taiwan currently has a high level of environmental awareness, and the industrial sector has already formed the concept of legal disposal of industrial waste. Coupled with the government's vigorous promotion of environmental protection work and increasingly improved environmental regulations, the situation of waste being casually buried without proper treatment will be greatly reduced. As the domestic industrial structure

consists mostly of small and medium-sized enterprises, most business units are unable to handle waste disposal on their own. Therefore, the waste they generate will inevitably need to be properly treated by professional waste disposal companies, and the market scale will further expand.

From the demand perspective, due to the current high environmental awareness, regardless of domestic or global environmental protection regulations becoming increasingly comprehensive, factory emission standards becoming more stringent, government's vigorous promotion of environmental protection, and businesses gradually emphasizing ESG, all contribute to the rising demand for waste treatment. Additionally, benefiting from the booming export orders in the manufacturing industry, the generation of industrial waste has also increased accordingly. Additionally, since 2019, Taiwanese businesses have been returning from mainland China to set up factories in Taiwan, ushering in an era of waste explosion that urgently requires qualified environmental treatment plants for assistance. Currently, there are only 113 companies in Taiwan with Class A treatment qualifications. Furthermore, with mountains of waste waiting to be processed and the serious problem of illegal industrial waste dumping causing environmental pollution and concerns about odor and air pollution, the waste treatment industry is experiencing a situation where demand exceeds supply.

From the supply perspective, due to regulatory restrictions, the treatment of general industrial and hazardous industrial waste requires obtaining permission from the competent authority and undergoing periodic reviews to execute related operations. Additionally, the timeline for license application certification is relatively lengthy, making the risk of supply surplus minimal.

Competitive Advantage

(1) Implementation of Smart Tools and Information Systems in Each Plant

Since the planning of its factories, the Company has gradually introduced the concept of information management and practically applied it to work processes, implementing comprehensive information management that complies with safety-oriented recycling and treatment technologies and procedures. This includes transportation, incineration, accounting management, material management, and report analysis, with the introduction of smart warehouse management methods that combine barcode technology and customized ERP systems to improve operational efficiency and quality. Additionally, we have established a high-specification laboratory to analyze the composition of waste materials, providing a basis for ingredient formulation and input, in order to achieve optimized treatment objectives. The plant is equipped with a central control room (CTV) and continuous emission monitoring systems (CEMS) to monitor the operational status of various systems during the incineration process, with feedback integration to laboratory information.

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01 高規格實驗室

中央控制室

02 ERP物料管理系統

導入數據倉儲管理方式，結合管區技術與客製化ERP系統，提高作業效率與品質

03 車輛軌跡監控圖台、行車視野輔助系統

有效掌握廢棄物流向；解決大貨車行車視野死角，避免交通事故

04 事業廢棄物清運處理平台

結合企業客戶、清運與處理業的策略聯盟，運用AI智能複合及大數據分析管理

(2) Continuous Improvement in Comprehensive Waste Treatment, Mercury-Containing Lamp and Waste PCB Recycling Technologies

Since the operation of the Company's Plant 1, which specializes in comprehensive incineration treatment of hazardous industrial waste, the Company has adopted automatic continuous monitoring and regular air pollution emission testing to control the potential environmental impact of waste treatment. The Company has voluntarily set "zero emission" and "zero waste" as its goals, and has invested in relevant research and development. Air pollution emission values already comply with the requirements of strict domestic and international environmental regulations. In the future, the Company will actively research carbon capture and reuse technologies, as well as fly ash detoxification techniques, with the determination to become a resource circulation zero-waste center that integrates energy and resource technologies, combining incineration power generation, solidification, and chemical treatment mechanisms.

The Company's Plant 2 utilizes dry physical treatment for waste lighting sources and mercury-containing waste, with dust collection filter bags, activated carbon adsorption, and scrubbing towers installed according to air pollution emission characteristics. Additionally, waste composite materials are treated by pyrolysis, equipped with post-combustion chambers, ceramic membrane filtration, dust collection filter bags, and activated carbon adsorption. In the future, the waste lighting source plant will continue to increase the resource recycling and reuse rate of waste lighting sources to over 95%.

The Company's Plant 3 employs crushing and sorting processes for waste printed circuit boards, with dust collection filter bag facilities installed for dust control. In the future, we will develop and implement metallurgical technologies such as acid dissolution, electrolysis, and smelting to increase the copper purity recovered from waste printed circuit boards to over 99%, recovering and producing high-purity copper materials to help reduce the industry's dependence on foreign imports. With core development focused on

feedstock conversion, material transformation, and energy recovery technologies, we are actively implementing circular economy principles and the United Nations Sustainable Development Goals (SDGs).

The Company's various plants separately process solid, liquid, and medical waste, and in response to the diverse and complex nature of industrial waste, we are licensed to receive 212 types of waste codes, making us the leading waste treatment center in northern Taiwan. The Company grasps development opportunities in the waste treatment and circular economy markets, continuously innovating and improving to enhance its core competitiveness, in order to realize the Company's founding mission of "Utilizing Resources for Public Welfare," and to continuously uphold the principle of "Innovating Technology to Drive the Economy, Cherishing Resources for Perpetual Circulation." Adhering to the ideal of resource circulation, the Company develops circular economy solutions encompassing "feedstock recovery, material recovery, and energy recovery." To establish the Company as "the best cooperative partner in the green supply chain for the industry," promoting resource circulation and utilization, and sustainable economic development.

Favorable and Unfavorable Factors Affecting the Company's Future Development Prospects and Response Strategies

(1) Favorable Factors

A. Environmental sustainability issues are receiving attention, and waste management regulations are becoming more stringent:

In Taiwan's early period, due to incomplete environmental protection laws, underdeveloped public environmental awareness, and lack of attention to environmental sustainability issues, there has been an increasing number of incidents where polluting industries illegally discharged wastewater/waste, or were heavily fined by government authorities or gradually shut down because they could not meet environmental regulatory standards. As environmental protection concepts become a global emerging trend, and with government promotion and increased knowledge levels, environmental awareness has been widely established, gradually building a positive image of the green energy and environmental protection industry in the minds of the Taiwanese people. The Environmental Protection Administration of the Executive Yuan also announced amendments to the "Regulations Governing the Reuse of Industrial Waste by the Environmental Protection Administration of the Executive Yuan" in 2022, clearly stipulating that public and private waste disposal organizations entrusted with removing reusable industrial waste must use vehicles approved by the issuing authority to carry out the removal, in order to achieve consistent management with public and private waste disposal organizations. In view of the increasingly strong environmental protection demands from the government and brand companies, the domestic needs for waste recycling and wastewater reuse have expanded further. For the

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environmental protection industry, which has already been developing steadily for a long time, this adds strong growth momentum, thus the industry outlook is expected to continue showing growth trends in the future.

B. Small and medium-sized enterprises lack the capacity to handle waste independently, and outsourcing waste management has become an industry trend in recent years

According to the "2025 White Paper on Small and Medium Enterprises" published by the Ministry of Economic Affairs, the number of SMEs in Taiwan exceeded 1.715 million in 2025, accounting for more than 98% of all enterprises. Since SMEs constitute the majority and generate relatively small amounts of waste, yet self-handling of waste treatment and transportation requires professional equipment setup, facilities, and trained technical operators, SMEs typically face challenges such as lack of economies of scale, processing space, technology, talent, and capital when attempting to manage waste independently, making it not cost-effective. In recent years, with the rise of the circular economy industry and sustainable regeneration trends, various businesses have gradually recognized the benefits of outsourcing to professional waste management service providers and the advantages generated by this professional division of labor. Therefore, outsourcing waste management has become increasingly common, which will help the Company's future business expansion and operational scale improvement. The Company regularly reports in accordance with environmental protection regulations and provides clients with comprehensive regulatory consultation, offering one-stop environmental protection services, which further enhances the Company's competitive advantage.

C. Good customer relationships and diverse client industries help to diversify risk

The Company is engaged in comprehensive treatment of industrial waste incineration for power generation, pollution remediation, treatment of mercury-containing waste, pyrolysis recovery of precious metals, and recycling copper from electronic waste printed circuit boards. Its main customers are spread throughout the northern region, and it also processes industrial waste from all over Taiwan through introductions and matchmaking by waste transportation companies. The Company has established high-quality business partnerships with customers and waste transportation companies over many years, demonstrating that its services have been recognized by customers. In the future, it will continue to strengthen business relationships with customers and respond to market demands through professional services and excellent processing results. In addition, the Company's clients come from various industries including electronics, construction, chemical industries, hotels, etc. This diversity of client industries also helps to disperse the concentration risk of a single industry.

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D. Regulatory Protection

Comprehensive domestic environmental protection regulations have increased the barriers to entry into this industry, and the Company regularly reports in accordance with environmental protection regulations and provides clients with comprehensive regulatory consultation, which further enhances the Company's competitive advantage.

E. Good management systems to reduce costs and enhance competitiveness

The Company has established various management systems and actively promotes and implements them, enabling each employee to understand their duties, relevant system regulations, and various welfare measures. The Company regularly conducts vocational training to instruct employees on the processing standards and recycling value of various wastes, with the aim of ensuring that all industrial waste collected by the Company receives the most appropriate treatment and achieves the highest recycling value.

(2) Unfavorable Factors and Countermeasures

A. Circular economy and carbon trading leading to a reduction in industrial waste

In response to the trend of circular economy, enterprises continue to promote source separation and waste reduction, use low-energy consumption machinery and equipment, collaborate with manufacturers to develop new waste recycling technologies, and strengthen the reuse of waste resources. The aim is to recycle waste generated during production activities or final products back into the supply chain, thereby achieving the goals of maximizing resource utilization and minimizing waste generation. In addition, the Taiwan Carbon Trading Exchange was inaugurated in Kaohsiung in August 2023. In the future, it will focus on three major trading items: domestic "voluntary reduction," "incremental offsetting," and international "carbon trading." For the entire industry or supply chain, through the carbon trading market, the price of carbon and the value of carbon credits will become more visible, increasing willingness to invest in carbon reduction projects, which will consequently affect the production volume of industrial waste in companies.

Response Strategies:

The Company's main business operations include the resource recovery treatment of waste lighting sources and waste printed circuit boards. We have also completed the construction of pyrolysis and incineration treatment facilities, as well as heat recovery power generation systems and bottom ash reuse facilities, providing comprehensive circular economy solutions. In the future, we will continue to research and develop high-value resource circulation technologies, develop processes that maximize resource recovery and reuse, and create innovative green products and services, striving to become the best partner in the green supply chain for the industry. In addition to maintaining close cooperative relationships with existing customers, we also continue to develop new customers. The

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Company is actively expanding into new business areas, including soil pollution remediation, waste lithium battery and waste solar panel recycling, flue gas carbon capture and reuse, and the production of solid recovered fuel. These initiatives will diversify the Company's waste treatment and recycling business, aligning with the trend of businesses choosing to commission resource recovery processing for their industrial waste, thereby continuously reducing operational risks.

B. PC Board Industry Fluctuations Affecting Raw Material Supply

As the Company's main source of raw materials is waste printed circuit boards generated from PC board manufacturing processes, we recover copper powder through resource recovery treatment of waste printed circuit boards produced by the electronics industry, which is then sold to copper smelters. If the PC board industry is affected by economic fluctuations, the capacity utilization rate of major technology manufacturers will influence the production volume of waste printed circuit boards, which directly affects the Company's raw material supply sources. This will consequently impact the processing volume of waste printed circuit boards, leading to idle or overloaded equipment capacity at the Company, thus affecting the Company's operational status.

Response Strategies:

The Company actively works through major transportation vendors to ensure stability of supply sources, deepening cooperation with major PC board manufacturers and transportation vendors while increasing added value, making the technical business cooperation model between both parties more closely integrated. We also continuously expand into new customer markets for product applications to inject new business capacity and balance dependence on existing customers. Furthermore, we enhance research and development capabilities to extend into new application areas, improving enterprise competitiveness and injecting new growth momentum for the company, with the aim of effectively reducing risks in raw material supply.

C. Copper Price Market Fluctuations Affecting Copper Powder Sales

The Company's Plant Three has obtained qualification as a Class A waste treatment facility. Waste printed circuit boards from PC board manufacturers undergo processing procedures including decomposition, dry crushing, wet crushing, and water table sorting, which can recover "copper powder" with a purity of over 80%. Additionally, the separated fiberglass resin undergoes a modification process to produce "concrete admixture". The Company sells recoverable copper powder to downstream businesses, so if international copper prices decline, it could adversely affect the Company's operations.

Response Strategies:

The Company employs dry/wet crushing and water table sorting to produce high-purity copper powder and concrete admixture products, achieving the

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goal of full recycling with zero waste. For future copper powder sales, we will adjust profit-sharing ratios with customers according to international copper price fluctuations, and ship products immediately to avoid inventory devaluation losses. Facing more uncertainties and challenges in the copper powder market, the Company will continuously make dynamic adjustments to its waste metal recycling and processing business model to address the profit impact caused by copper price fluctuations. In the future, we will collaborate with the Metal Industries Research & Development Centre on research for "Lithium Battery Recycling and Regeneration" and "Refining Copper Ingot Slag Smelting and Electrolytic Purification Technology." We hope to recover valuable resources (such as positive electrodes (black powder) and high-purity copper plates) through equipment improvements and innovative technologies, continuing to develop the Company's urban mining philosophy.

D. Difficulty in Acquiring Talent

In recent years, the Company's main business operations include comprehensive treatment of waste incineration for power generation, mercury recovery from mercury-containing waste, thermal pyrolysis treatment for precious metal recovery, copper recovery from waste printed circuit boards, and environmental remediation engineering, providing comprehensive resource recycling solutions. As the environmental protection industry market expands and labor demands increase, combined with the continuous rise in the price index over the past two years, waste treatment production lines require highly specialized technical talents in chemical engineering, electrical engineering, electronics, mechanics, materials, environmental engineering, occupational safety, and equipment operation. Furthermore, due to the relatively remote location and inconvenient transportation of industrial factory areas such as Guanyin in Taoyuan where we are situated, recruitment and acquisition of talent is comparatively difficult.

Response Strategies

To address the difficulty in talent recruitment, the Company continues to improve the work environment by providing excellent employee benefits and developing employee reward programs to enhance employee loyalty to the company. At the same time, through external training opportunities, we enrich employees' knowledge of the latest technologies and relevant regulations in the industry. We have also established a comprehensive annual training plan for operating and maintaining treatment facilities to strengthen employees' core professional skills. We continuously enhance employees' soft and hard capabilities to ensure that colleagues can balance career planning with achievement and growth in their work, thereby increasing retention willingness and creating higher work efficiency and workplace value. Additionally, through the capital market, we enhance the company's visibility and corporate image to attract outstanding talent.

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(2) Main Products' Important Uses and Production Processes

1. Important Uses of Main Products (Post-Treatment Derivatives)

The Company is part of the recycling industry, taking over at the waste stage of the product life cycle. Its main business model is "resource regeneration and recovery," which enables waste resources to be reborn and enter the manufacturing end for reuse or as recycled materials to replace virgin materials, as well as producing high-value materials or developing innovative products, providing "closed-loop," "upcycling," or "downcycling" uses.

2. Production Process

(1) Integrated Waste-to-Energy and Resource Recovery Treatment

Treatment methods include incineration, solidification, and chemical treatment, with heat recovery for power generation and bottom ash reuse, making it an integrated waste-to-energy and resource recovery treatment center.

(2) Resource Recovery Treatment for Waste Lighting Sources and Mercury-Containing Waste

Self-developed recycling equipment for waste lighting sources, achieving a resource recovery rate of over 90%, with mercury recovery reaching high recovery rates and high purity levels, leading the world in this technology.

(3) Resource Recovery Treatment for Waste Composite Materials

Using vacuum-based oxygen-free thermal pyrolysis technology to change the bonding structure of waste composite materials, making them easier to separate, while preserving valuable inorganic resources (such as precious metals) for subsequent purification processing. For waste materials that are difficult to treat through incineration and do not contain precious metals, this technology processes them into inorganic residues for resource recovery applications.

(4) Resource Recovery Treatment for Waste Printed Circuit Boards

Using dry/wet crushing and water shaking table separation to produce high-purity copper powder and concrete admixture products, achieving the goal of full-cycle recycling with zero waste.

(3) Current Supply Status of Main Raw Materials

The main raw materials are waste lighting tubes and waste electrical and electronic items provided by recycling companies and business organizations. We maintain long-term cooperative relationships with our main raw material suppliers, having collaborated for many years with good partnership relations, resulting in stable supply conditions. There have been no instances of supply shortages or material disruptions.

(4) Explanation of Significant Changes in Gross Margin by Major Product Category or Department Over the Past Two Years

Comparative Table of Gross Margin Changes Over the Past Two Years

Unit: NT$ thousand; %

Item	Year	2024	2025	Percentage Change
	Items	Gross Margin	Gross Margin
Waste Treatment Services		40%	40%	-
Copper Powder and Other Product Sales		40%	35%	-5%
Environmental Remediation Projects		23%	22%	-1%
Others		100%	100%	-
Total		35%	39%	+4%

Analysis of Gross Margin changes exceeding 20%: Not applicable.

(5) Major Suppliers and Customers List

Names of suppliers accounting for more than 10% of total purchases in either of the last two years, their purchase amounts and proportions, and explanation for changes

Unit: NT$ thousand; %

Items	2023				2024				2025
	Name	Amount	Percentage of Annual Net Purchases (%)	Relationship with the issuer	Name	Amount	Percentage of Annual Net Purchases (%)	Relationship with the issuer	Name	Amount	Percentage of Annual Net Purchases (%)	Relationship with the issuer
1	HG Company	166,933	32.08	None	HG Company	366,401	50.13	None	Unimicron Technology Corp.	78,859	18.65	None
2	Unimicron Technology Corp.	56,753	10.91	None	-	-	-	-	DF Company	52,580	12.43	None
3									JI WEI	45,411	10.74	(Note 1)
	Others	296,719	57.01	-	Others	364,557	49.87	-	Others	246,008	58.18	-
	Net purchase amount	520,405	100.00		Net purchase amount	730,958	100.00		Net purchase amount	422,858	100.00

(Note 1) Subsidiary of the investor with significant influence (CLEANAWAY)
(Note 2) As of the date of printing of this annual report, the Company's financial statements for the first quarter of 2026 have not yet been reviewed by an accountant and are therefore not disclosed.

Reasons for increases and decreases: The Company is primarily engaged in the treatment of waste lighting sources, recycling of waste printed circuit boards, and waste incineration treatment services. Major procurement items include waste electronic raw materials, waste lighting fixtures, chemical materials, as well as derived treatment fees, transportation fees, and related labor service expenditures. In 2023, the addition of environmental engineering services drove an increase in related labor and engineering

demand, causing the procurement proportion of certain engineering-type suppliers (such as Company HG) to rise, resulting in a phased change in the supplier structure. In 2025, as the environmental engineering business entered a transitional handover period, demand for engineering-related procurement declined, and the proportion of purchases from HG Company decreased accordingly. The supplier structure reverted to being primarily centered on core raw material procurement, with waste electronic material suppliers (such as Unimicron Technology Corp. and DF Company) once again becoming the main supply sources. In addition, the related party Jiwei is an important landfill cooperation partner of the Company, primarily responsible for the final disposal of fly ash solidification after incineration. Based on a long-term cooperative relationship and business complementarity, both parties have established a stable cooperation model. Overall, the Company's supply source structure has returned to normal, with a certain degree of diversification and stability.

Names of customers who have accounted for more than ten percent of the total sales in either of the last two years, along with their sales amounts and percentages, and an explanation of the reasons for any changes

Unit: NT$ thousand; %

Items	2023				2024				2025
	Name	Amount	Percentage of annual net sales (%)	Relationship with the issuer	Name	Amount	Percentage of annual net sales (%)	Relationship with the issuer	Name	Amount	Percentage of annual net sales (%)	Relationship with the issuer
1	Public Works Bureau of Kaohsiung City Government	206,659	16.24	None	Public Works Bureau of Kaohsiung City Government	544,557	31.72	None	Chase Sustainability Technology	195,517	16.92	Equity method recognized reinvestment
2	FP Group	198,164	15.57	None	-	-	-	-	Nissho Oguchi Electronics Co., Ltd.	127,827	11.06	None
3	Chase Sustainability Technology	135,153	10.62	Equity method recognized reinvestment	-	-	-	-	FP Group	120,539	10.43	None
	Others	732,481	57.57	-	Others	1,172,188	68.28	-	Others	711,625	61.59	-
	Net sales	1,272,457	100.00	-	Net sales	1,716,745	100.00	-	Net sales	1,155,508	100.00	-

(Note 1) As of the date of printing of this annual report, the Company's financial statements for the first quarter of 2026 have not yet been reviewed by an accountant and are therefore not disclosed.

Reasons for increases and decreases: The Company is primarily engaged in the processing of waste lighting sources, recycling of waste printed circuit boards, and waste incineration treatment. In 2023 and 2024, due to the contracting of soil and groundwater pollution remediation projects, the Public Works Bureau of Kaohsiung City Government became the Company's largest customer, resulting in a stage-specific concentration in the customer structure; however, such business is project-based in nature. In 2025, as the existing soil pollution remediation projects gradually came to an end, the Public Works Bureau of Kaohsiung City Government was no longer listed as a major customer, and the Company's customer structure reverted to being primarily centered on core waste treatment and resource recycling businesses. The top three customers in 2025 were Chase Sustainability Technology Co., Ltd., Nissho Oguchi Electronics Co., Ltd., and FP Group. Among them, Chase Sustainability Technology is an environmental matchmaking platform with the benefit of stably introducing customer sources; Nissho Oguchi Electronics of Japan is primarily a long-term cooperation customer for copper powder exports; and FP Group is mainly focused on the chemical industry. Overall, the Company's customer structure has returned to a normal state of diversity and diversification.

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3. Information on employees in the last two years and up to the printing date of the annual report

Unit: person

Year		End of 2024	End of 2025	March 31, 2026
Number of employees	Direct employees	120	121	125
	Indirect employees	68	66	66
	Total	188	187	191
Average age		39.08	39.87	39.97
Average years of service (years)		4.08	4.95	5.00
Education distribution ratio	Doctorate	0.00%	0.00%	0.00%
	Master's Degree	7.98%	9.09%	8.90%
	Bachelor's degree (specialized)	39.89%	37.43%	37.17%
	High school (and below)	52.13%	53.48%	53.93%

4. Environmental protection expenditure information

(1) According to legal requirements, explanation of the application, payment, or establishment status for those who should apply for pollution facility installation permits or pollution discharge permits, or should pay pollution prevention fees, or should establish dedicated environmental protection units and personnel:

In terms of waste treatment: According to the Waste Disposal Act, the Company has three Class A waste treatment plants. Plant 1 is a Comprehensive Energy Resource Recovery Treatment Center (treatment methods include: incineration, solidification, and chemical treatment), Plant 2 is a Mercury-Containing Waste and Composite Material Resource Recovery Treatment Center (treatment methods include: thermal treatment and physical treatment), and Plant 3 is a Waste Printed Circuit Board Resource Recovery Treatment Center (treatment method is physical treatment). According to legal requirements, the following relevant permits and licenses have been obtained:

Applying unit	Permit Type	Certificate Number	Valid Period
Taoyuan City Government	First Plant Class A Waste Treatment Facility	2025 Taoyuan City Waste Class A Treatment Certificate No. 0010	2028/11/28
Taoyuan City Government	Second Plant Class A Waste Treatment Facility	2024 Taoyuan City Waste Class A Treatment Certificate No. 0039	2029/07/07
Taoyuan City Government	Third Plant Class A Waste Treatment Facility	2024 Taoyuan City Waste Class A Treatment Certificate No. 0062	2029/10/22

Air Pollution Control Section: According to the Air Pollution Control Act, the Company has established control procedures for four fixed pollution sources. According to legal requirements, the following relevant permits and licenses have been obtained:

Applying unit	Permit Type	Certificate Number	Valid Period
Department of Environmental Protection, Taoyuan City Government	Plant 1 Waste Incineration Treatment Procedure (M01)	Environmental Air Operation Certificate No. H7008-03	2017/03/17
Department of Environmental Protection, Taoyuan City Government	Plant 1 Waste Solidification Treatment Procedure (M02)	Environmental Air Operation Certificate No. H7004-01	2017/03/10
Department of Environmental Protection, Taoyuan City Government	Plant 2 Mercury-Containing Waste Recycling Manufacturing Procedure (M01)	Environmental Air Operation Certificate No. H4747-08	2030/07/06
Department of Environmental Protection, Taoyuan City Government	Plant 2 Waste Thermal Treatment (Excluding Incineration) Procedure (M02)	Environmental Air Operation Certificate No. H6785-02	2030/08/30

Regarding water pollution prevention: All of the Company's processing plants are located within the technology park, and the wastewater generated is all connected to and treated by the park's wastewater treatment center.
During the operational phase, in addition to general domestic waste, general industrial waste and hazardous industrial waste may be generated after waste treatment. These can be handled by the Company's Plant 1 for in-house treatment. The incineration bottom ash after treatment is made into recycled products, while the incineration fly ash is solidified in the plant and then sent to qualified treatment facilities for landfill disposal.
In accordance with legal regulations, employees have obtained qualification certificates issued by the Ministry of Environment, including four Class A Waste Treatment Professional Technicians, two Class B Waste Treatment Professional Technicians, one Class A Air Pollution Control Specialist, one Class A Wastewater Treatment Specialist, and one Class A Toxic Chemical Substance Professional Management Technician.
Status of Pollution Prevention Fee Payments:

A. Air Pollution Control Fees: Pollution control fees are paid according to the Air Pollution Control Act and the concentration of pollutant emissions.

B. Soil Pollution Prevention Fund: The soil pollution prevention fund is paid based on the production volume of regulated recycled products.

(2) List of the Company's main investments in environmental pollution prevention equipment, their purposes, and potential benefits:

Details of Pollution Prevention Equipment

December 31, 2024 Unit: NT$ thousand

Equipment Name	Quantity	Acquisition Date	Investment Cost	Undepreciated Balance	Purpose and Expected Benefits
Exhaust Gas Treatment Equipment Activated Carbon Exhaust Gas Treatment Equipment Incinerator CEMS Project Dust Collection Equipment	One Batch	2022/4/1	135,610	112,791	Set up a post-combustion chamber for complete combustion of harmful substances, coupled with an air pollution prevention system to neutralize exhaust gases. The air pollution prevention system includes a desulfurization and acid removal system, denitrification system, selective catalytic reduction, bag dust collectors, Venturi scrubbers, and wet scrubbing towers to remove nitrogen oxides, particulate pollutants, heavy metals, and suppress dioxins from exhaust gases.
Wastewater Treatment Plant Equipment	One Batch	2022/4/1	33,700	25,462	Treatment facilities include various waste liquid collection ponds, pH adjustment tanks, reduction tanks, oxidation tanks, activated carbon reaction tanks, rapid mixing chambers, slow mixing basins, chemical precipitation tanks, chemical neutralization tanks, sludge concentration tanks, and press filter type sludge dewatering machines. The main purpose is to remove organic matter and heavy metals from wastewater, then neutralize and dilute before discharging to the industrial zone wastewater treatment plant through the sewer system.
Catalytic Filter Bag Set	One Batch	2023/3/1	23,027	15,994	Dust filtration can achieve 99.9% removal efficiency, and the special catalyst can remove nitrogen oxides and dioxins, reducing gaseous and particulate air pollutant emissions.
Sodium Bicarbonate Grinding System Engineering	One Batch	2023/3/23	6,410	5,442	Refinement of air pollution control materials, increasing gas contact rate, enhancing adsorption and removal of acidic gases, and reducing acidic gas emission concentrations.
dust collection equipment	One Batch	2021/7/1	1,530	689	Recycle suspended particulates in waste gas.

(3) Please indicate the losses suffered by the company due to environmental pollution for the year and up to the printing date of the annual report (including compensation and violations of environmental protection regulations resulting from environmental protection inspections, which should clearly state the date of disposition, disposition reference number, violated regulation articles, content of violation, and content of disposition), and disclose the current and future estimated amounts and countermeasures. If a reasonable estimate cannot be made, please explain the fact that it cannot be reasonably estimated:

Penalty Incident Due to Negligence in Waste Declaration Operations

When the Company carried out waste treatment declaration operations in 2025, an operational error resulted in incorrect entry of the manifest date, causing the data to show an abnormally long processing period that was inconsistent with general practical operations. The declaration was completed without the abnormality being detected in real time by the declaration system, resulting in non-compliance with relevant regulatory requirements. The Company was accordingly penalized NT$60,000 by the competent authority in accordance with the law, and the penalty has been paid in full.

Upon investigation, this case was determined to be an administrative entry error. The actual waste receipt and treatment operations were carried out in accordance with regulations, and no abnormalities in the treatment process or environmental risks were involved. The Company has conducted a comprehensive review of this incident, strengthened the reasonableness verification mechanism for declared data, and introduced multi-tier review procedures. Employee training and awareness of regulatory compliance have also been enhanced to reduce the risk of similar incidents occurring again.

In the future, the Company will continue to optimize internal control processes and pay attention to the reasonableness verification mechanism of external declaration systems to ensure the accuracy and timeliness of declared data, thereby enhancing the overall level of compliance management.

5. Labor-Management Relations

(1) List the company's various employee welfare measures, continuing education, training, retirement system and their implementation status, as well as the agreements between labor and management and the measures for protecting various employee rights and interests

Employee Welfare Measures and Implementation Status

(1) In addition to the Labor Insurance and National Health Insurance required by law, the Company also provides group insurance for employees.

(2) Dragon Boat Festival and Mid-Autumn Festival bonuses, and year-end bonuses are provided.

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(3) Factory employees undergo an annual health examination once a year; Taipei office employees undergo a health examination once every two years.

(4) The Company provides employees with free lunch boxes or meal subsidies, as well as milk, coffee, tea, and snacks to care for their daily needs.

(5) The Company's Employee Welfare Committee was established in 2019 and was approved and filed by the Taoyuan City Government under document No. 1080329025. The Company's Employee Welfare Committee coordinates various employee welfare and subsidy matters, arranges employee trips, health promotion activities, and provides opening ceremony gifts, May Day Labor Day gifts, birthday gifts, childbirth congratulatory gifts, wedding gifts, and funeral condolence payments.

(6) The Company has entered into a cooperation project with a kindergarten near the plant to assist employees in arranging nearby childcare for their children, improving the convenience of childcare and reducing the burden of family care on employees.

(7) Various incentive programs are offered, such as rewards for recommending outstanding talent.

(8) We value the physical and mental health of our employees, and have specially appointed professional occupational physicians and nurses to be stationed at the factory regularly to provide physical and mental health consultation services for employees. With the help of a professional team, employees can receive health assessments, psychological counseling, and healthcare recommendations during work hours, helping to detect and improve physical and mental stress or health issues early on, promoting workplace health and well-being, and creating a secure and friendly work environment.

Employee continuing education, training, and implementation status

The Company has established an education and training procedure to help new employees understand their job responsibilities and work environment, and provides relevant guidance to employees during their work, cultivating employees' professional knowledge and skills, enabling them to develop their competencies and increase work efficiency, providing employees with a good work environment for learning and growth.

Retirement system and implementation status

In accordance with the new labor pension system under the Labor Pension Act, the Company contributes 6% of employees' monthly total salary as retirement funds, which are deposited into individual retirement accounts at the Bureau of Labor Insurance. Foreign employees are subject to the old labor pension system. Retirement payments under the old defined benefit pension scheme are calculated based on years of service and the average salary for the six months prior to the approved retirement date. The Company contributes 2% of employees' monthly total salary as retirement funds, which are deposited by the Labor Retirement

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Reserve Supervisory Committee into a designated account at Bank of Taiwan in the name of the committee. Before the end of each fiscal year, if the estimated balance in the designated account is insufficient to cover the payments for employees expected to meet retirement conditions in the following year, the shortfall will be contributed in a lump sum before the end of March of the following year. The designated account is entrusted to the Bureau of Labor Funds, Ministry of Labor for management.

No employees retired in 2025. In 2025, the Company contributed NT$4,773 thousand in new pension scheme retirement funds; NT$540 thousand was accrued to the old pension scheme retirement fund account in 2025, and the balance of the old pension scheme retirement fund account at Bank of Taiwan as of the end of 2025 was NT$14,441 thousand.

4. Status of labor-management agreements

The Company's various regulations all comply with the Labor Standards Act as the guiding principle. The Company highly values employee opinions, adopts a two-way and open approach to communicate with employees, and regularly holds labor-management meetings, with the aim of maintaining a good and harmonious interactive relationship between labor and management. The Company has established a mechanism for regular communication with employees and provides reasonable notification to employees of operational activities that may have a significant impact. In 2025, the Company held a total of eight labor-management meetings based on work locations and operational sites, averaging two meetings per quarter.

5. Status of various employee rights protection measures

The Company has established relevant management measures and systems, which clearly stipulate employee rights and obligations, human rights promotion, and welfare items. The Company regularly reviews and revises welfare content to protect the rights of all employees. The Company has established employee grievance mechanisms and channels, and handles them appropriately. The Company has obtained ISO 45001:2018 Occupational Health and Safety Management System certification (Chung Tai Plant 1, Plant 2, and Plant 3, valid from September 5, 2023 to September 4, 2026), providing employees with a safe and healthy work environment, and regularly implements safety and health education for employees.

(2) In the most recent year and up to the printing date of this annual report, losses incurred by the Company due to labor disputes (including violations of the Labor Standards Act identified in labor inspections, which should specify the date of penalty, penalty reference number, violated provisions, content of violation, and penalty content), and disclosure of current and potential estimated amounts and response measures. If a reasonable estimate cannot be made, the fact that a reasonable estimate cannot be made should be stated.

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Unit	Penalty Date	Penalty Reference Number	Violated Provisions	Content of Violation	Penalty Content and Response Measures
Occupational Safety and Health Administration	2025/01/03	Occupational Safety and Health Administration Letter No. 1130208041	Article 104, Paragraph 1 and Article 107 of the Safety Standards for Machinery and Equipment, and Article 6, Paragraph 1 of the Occupational Safety and Health Act	The guards used on bench grinders and pedestal grinders were not equipped with tongue plates or other methods to adjust the gap between the periphery of the necessary grinding wheel part and the guard to less than ten millimeters; bench grinders or pedestal grinders did not have work rests that could be adjusted to maintain a gap of less than three millimeters between the grinding wheel and the work rest.	(Note 1)
Occupational Safety and Health Administration	2025/01/03	Occupational Safety and Health Administration Letter No. 1130208041A	Article 27, Paragraph 1, Subparagraphs 1, 2, and 3 of the Occupational Safety and Health Act	When working jointly with contractors where workers are employed separately, failed to establish a coordinating organization and designate a person in charge of the workplace for command, supervision, and coordination duties; failed to implement necessary measures for work communication and adjustment; and failed to conduct inspections of the workplace.	(Note 2)
Occupational Safety and Health Administration	2025/01/06	Occupational Safety and Health Administration Letter No. 1130207934	Article 6, Paragraph 1, Subparagraph 2 of the Regulations on Designation and Management of Priority Management Chemicals and Article 14, Paragraph 2 of the Occupational Safety and Health Act	Operators have failed to report the following priority management chemicals for reference as required by Article 14, Paragraph 2 of the Act: 1. ... 2. When operating priority management chemicals as specified in Article 2, Subparagraph 2, whose concentration and total annual operation volume for any operational activity reach the standards set forth in Appendix 2.	(Note 3)

(Note 1) The total fine amounted to NT$60,000. We have completed relevant tool and equipment adjustments as well as operational modifications. We have also strengthened equipment inspections and pre-use verifications by personnel to prevent similar incidents from occurring again.

(Note 2) The total fine amounted to NT$90,000. We have completed the establishment of a coordination organization, with the workplace supervisor taking charge of command, supervision, and coordination work. This ensures sufficient communication and adjustment of work matters between the Company and contractors, implements pre-operation coordination and during-operation inspection mechanisms, and strengthens on-site safety management.

(Note 3) The total fine amounted to NT$60,000. We have verified the operational status of relevant priority managed chemicals. For chemicals meeting reporting requirements, we have completed the filing and reporting in accordance with relevant regulations. We have also established an internal management mechanism to ensure timely and accurate reporting operations in the future.

6. Information Security Management

(1) Description of information security risk management structure, information security policies, specific management programs, and resources invested in information security management, etc.

To strengthen information security management, establish a secure and trustworthy electronic enterprise, and ensure the security of data, systems, equipment, and networks, the Company has established a dedicated Information Department. In accordance with relevant laws and regulations, this department conducts information security risk assessments, determines the security requirement levels for various information operations, and implements appropriate and sufficient information security measures. This ensures the security of information collection, processing, transmission, storage, and circulation both internally and externally. The information security policies and management approaches are as follows:

The Company's information security management structure is as follows:

The Company places great importance on information security management and has established a comprehensive information security governance framework. The Board of Directors oversees the promotion of cybersecurity matters, and the President serves as the dedicated information security officer, taking overall charge of information security strategy, risk control, and implementation mechanisms, and regularly reporting implementation progress and improvement results to the Board of Directors.

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Information Security Policies and Specific Management Programs

To effectively implement information security management, the Company's information security organization follows the Plan-Do-Check-Act (PDCA) approach for management execution. This involves reviewing the applicability of information security policies and protection measures, with the Information Security Emergency Response Team reporting on implementation effectiveness.

The "Planning Phase" focuses on information security risk management, establishing a comprehensive information security management system and reducing enterprise security threats from system, technical, and procedural perspectives. This establishes confidential information protection services that meet customer requirements at the highest standards.
The "Implementation Phase" establishes multi-layered security protection, continuously introducing and integrating security control mechanisms into daily operational processes such as software and hardware maintenance, supplier information security management, etc. It systematically monitors information security to maintain the confidentiality, integrity, and availability of the Company's important assets.
The "Checking Phase" actively monitors information security management and verifies implementation and effectiveness through periodic audits of related operations.
The "Action Phase" is based on review and continuous improvement, implementing supervision and audits to ensure the ongoing effectiveness of information security regulations. When employees violate relevant regulations and procedures, they are handled according to the information security violation process, and personnel actions are taken based on the severity of the violation (including impact on the employee's annual performance evaluation or necessary legal actions). Additionally, regular reviews and implementation of improvement measures including information security measures, education, training, and promotion are conducted to ensure that the Company's important confidential information is not leaked.
Resources Invested in Information Security Management

The Company regularly conducts information security and personal data protection education and training for all employees. Additionally, information security and personal data training courses are arranged for specialized work areas such as system administration, network management, program development, information security management, security testing, and personal data protection.

The Company has joined the Taiwan Computer Emergency Response Team/Coordination Center (TWCERT/CC) cybersecurity alliance, receiving real-time cybersecurity intelligence and threat notifications through the TWISAC platform. The Company has also established internal response and notification mechanisms to strengthen external intelligence integration capabilities and

cybersecurity incident response efficiency, thereby enhancing the overall level of cybersecurity protection.

(2) List any losses suffered due to major information security incidents in the last two years and up to the printing date of the annual report, their potential impacts, and response measures. If reasonable estimation is not possible, the fact of such inability should be stated: Not applicable.

Important Contracts

Nature of Contract	Parties	Contract Period	Main Content	Restrictive Clauses
Credit Facility Agreement (Capital Expenditure)	Hua Nan Bank, HSINSHENG BRANCH	2021.10.29~2036.10.29	Industrial Park Loan - Factory	Provide land and building as collateral; commitment not to grant any rights to other creditors on machinery and equipment (negative pledge).
Credit Facility Agreement (Capital Expenditure)	Hua Nan Bank, HSINSHENG BRANCH	2020.02.24~2030.02.24	SME Accelerated Investment Loan
Labor Service Contract	Construction Office Public Works Bureau, Kaohsiung City Government	2023.07.26-2025.07.25, subsequently extended to 2026.04.30	Accelerating Soil and Groundwater Pollution Remediation Work for Kaohsiung Refinery Areas 1, 2, 5, and 6 (North Area 1 Case)	None
Industrial Waste Treatment Contract	Companies under FP Group	2023.10.01~2025.09.30 Renewed for one year until 2026.09.30	Industrial Waste Treatment	None
Industrial Waste Disposal Agency Contract	JI WEI Co., Ltd.	2025.11.05~2026.04.30	Landfill of Solidified Material After Intermediate Treatment	None
Labor Engineering Contract	HG Co., Ltd.	2023.07.26~2025.07.25 then further extended to 2026.4.30	Pollution Remediation Excavation and Other Labor Services	None
Industrial Natural Gas Purchase and Sale Agreement	CPC Corporation, Taiwan	2021.04.06~2026.03.30	Natural Gas Supply	None
Qualified Cogeneration System Power Purchase and Sale Agreement	Taiwan Power Company	2023.8.16~2024.8.15, extended by one year upon expiration, and the same thereafter	Sale of electricity	None

V. Review and Analysis of Financial Status, Operating Results, and Risk Factors

Financial Status Comparative Analysis Table

Main reasons and impacts of significant changes in assets, liabilities, and equity over the past two years; if the impact is significant, future response plans should be explained:

Item	2024	2025	Difference
			Amount	%
Current Assets	1,098,814	541,995	-556,819	-50.67%
Property, Plant and Equipment	3,027,490	3,279,896	252,406	8.34%
Intangible Assets	690	494	-196	-28.41%
Other Assets	298,900	309,907	11,007	3.68%
Total Assets	4,425,894	4,132,292	-293,602	-6.63%
Current Liabilities	529,447	487,310	-42,137	-7.96%
Non-current Liabilities	1,160,269	1,047,370	-112,899	-9.73%
Total Liabilities	1,689,716	1,534,680	-155,036	-9.18%
Share Capital	918,880	914,880	-4,000	-0.44%
Capital Surplus	1,268,992	1,218,081	-50,911	-4.01%
Retained Earnings	571,114	508,092	-63,022	-11.03%
Other Equity	-22,808	43,441	-20,633	90.46%
Non-controlling Interests	-	-	-	-
Total Equity	2,736,178	2,597,612	-138,566	-5.06%

Explanation of significant changes (items with period-over-period changes of 20% or more and an absolute change amount of NT$10 million or more; or a difference amount of NT$100 million or more):

(1) Decrease in current assets: mainly due to a decrease in cash and cash equivalents, with operating activities generating cash inflows of NT$417,953 thousand, investing activities resulting in cash outflows of NT$439,266 thousand, and financing activities resulting in cash outflows of NT$492,273 thousand.

(2) Increase in property, plant and equipment: mainly due to higher capital expenditures invested in the construction of the second-phase plant at Chung Tai Plant 1.

(3) Decrease in total assets: mainly attributable to the decrease in current assets, as cash from certain current assets was converted into capital expenditures, followed by repayment of long-term bank loans and distribution of cash dividends.

(4) Decrease in non-current liabilities: mainly due to the Company's repayment of long-term bank loans.

(5) Decrease in total liabilities: mainly attributable to the decrease in non-current liabilities.

(6) Decrease in other equity: mainly due to the recognition of unrealized valuation losses on financial assets measured at fair value through other comprehensive income.

A. Inventory Turnover Ratio

Period	2024	2025
Inventory Turnover Ratio (times)	40.07	19.19
Average Days in Inventory	9.10	19.02

Mainly attributable to the combined effect of a decrease in cost of goods sold and an increase in average inventory balance. On one hand, the cost of goods sold for the current period decreased compared to the prior period due to a decline in environmental engineering business; on the other hand, based on a cautiously optimistic outlook for copper powder product sales momentum in Q1 of 2026, the Company strategically increased its finished goods inventory level at the end of 2025 to meet subsequent shipment demand, resulting in a higher average inventory balance.

B. Accounts Receivable Turnover Ratio

Period	2024	2025
Receivables Turnover Ratio (times)	10.14	6.17
Average Collection Days	35.99	59.15

The accounts receivable turnover ratio changed significantly in the current period compared to the prior period, mainly due to a decrease in operating revenue. Due to the project-based and volatile nature of the environmental remediation engineering business, 2024 represented a peak period for operations, while 2025 saw a relative decline in overall operating revenue as existing projects were progressively completed and newly contracted projects were still in the transition and handover stage. The reduction in revenue scale affected the performance of the accounts receivable turnover ratio, resulting in a significant change.

Future Response Plans for Significant Impacts:

The above changes do not have a significant adverse impact on the Company, and the Company's overall performance has no significant abnormalities, so there is no need to develop a response plan.

2. Financial Performance Comparative Analysis Table

The main reasons for significant changes in operating revenue, operating profit, and pre-tax profit for the most recent two years, the expected sales volume and its basis, the possible impact on the company's future financial and business operations, and the response plan:

(1) Analysis of Operating Results for the Most Recent Two Years

Unit: NT$ thousand; %

Item	2024	2025	Amount of Increase (Decrease)	Percentage of Change %
Operating Revenue	1,716,745	1,155,508	-561,237	-32.69%
Operating Costs	1,116,782	712,524	-404,258	-36.20%
Gross Profit from Operations	599,963	442,984	-156,979	-26.16%
Operating Net Income	514,539	357,632	-156,907	-30.49%
Non-operating Income and Expenses	-4,266	-14,964	-10,698	250.77%
Income Before Tax	510,273	342,668	-167,605	-32.85%
Net Income for the Period	408,955	277,947	-131,008	-32.03%
Total Comprehensive Income for the Period	393,829	257,882	-135,947	-34.52%

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Description of Significant Changes (Changes exceeding 20% between periods, and absolute change amount exceeding NT$10 million):

(7) The decrease in operating revenue and cost of goods sold in the current period compared to the prior period was mainly due to the environmental engineering business being in a project transition period, and the inherently cyclical and fluctuating nature of engineering-type businesses, resulting in a simultaneous decline in overall revenue and the corresponding costs.

(8) Affected by the adjustment in revenue scale, gross profit from operations and net profit from operations decreased accordingly. However, the overall gross profit structure remained relatively stable, reflecting that the core business still maintains a certain level of profitability.

(9) Non-operating income and expenses for the current period decreased compared to the prior period, primarily due to international exchange rate fluctuations in second quarter of 2025, which resulted in greater foreign exchange losses.

(10) Under the combined effect of the above factors, pre-tax net profit, net profit for the period, and total comprehensive income for the period declined compared to the prior period, with the magnitude of change broadly consistent with the trend in revenue changes.

In 2025, the Company's overall operations remained stable. Although revenue performance fluctuated slightly due to the transition period of environmental remediation project work, the core waste treatment business continued to demonstrate steady demand and strong profitability, driving an improvement in the overall gross profit margin. The Company continued to optimize production line efficiency and resource allocation, strengthen cash flow quality and financial structure, and maintain overall operational stability.

Depreciation, Amortization, and Interest Expenses
Unit: NT$ thousand

Period	2024	2025
Depreciation Expenses	137,627	129,322
Amortization Expenses	269	279
Interest Expense	33,726	27,856

The decrease in depreciation expenses was mainly attributable to the gradual completion of depreciation on existing plant and equipment. The decline in interest expenses reflected the effectiveness of the Company's continued loan repayments and financial structure optimization.

(2) Expected sales volume and its basis, possible impact on the company's future financial and business operations, and response plans:

The Company has not published future financial forecasts, therefore we do not intend to disclose expected sales volumes.

3. Cash Flow Comparison Analysis Table

(1) Analysis of Cash Flow Changes in the Most Recent Year

Unit: NT$ thousand

Item\Year	2024	2025	Amount of Increase (Decrease)	Change Ratio (%)
Cash Inflow (Outflow) from Operating Activities	291,966	471,953	179,987	61.65%
Cash Inflow (Outflow) from Investing Activities	(104,703)	(439,266)	(334,563)	319.54%
Cash Inflow (Outflow) from Financing Activities	174,576	(492,273)	(666,849)	-381.98%
Analysis of Cash Flow Changes: 1. Net cash inflows from operating activities for the current period increased significantly compared to the prior period, primarily due to improvements in working capital management and enhanced cash collection capabilities from core operations, demonstrating the strong cash generation capacity and operational quality of the Company's core business. 2. Cash outflows from investing activities increased during the current period, mainly as the Company continued to invest in property, plant, and equipment, actively positioning itself for future growth momentum on the basis of capacity expansion. 3. Cash flows from financing activities turned to a net outflow during the current period, primarily due to loan repayments, cash dividend distributions, and treasury stock plans, continuously optimizing the financial structure and returning value to shareholders.

(2) Improvement Plan for Insufficient Liquidity: The Company does not have any issues with insufficient liquidity.
(3) Analysis of Cash Liquidity for the Coming Year (2026) (Parent Company)

Unit: NT$ thousand

Beginning Cash Balance	Expected Net Cash Flow from Operating Activities for the Entire Year	Expected Net Cash Flow from Investing Activities for the Entire Year	Expected Net Cash Flow from Financing Activities for the Entire Year	Expected Cash Surplus (Deficit) Amount	Remedial Measures for Expected Cash Deficit
					Investment Plan	Financial Management Plan
78,447	593,648	(166,703)	(412,098)	93,294	-	-
Analysis and Explanation: 1. Analysis of Cash Flow Changes for the Coming Year: Operating Activities: Cash flows from operating activities over the next year are expected to increase compared to 2025, primarily driven by increased operating cash inflows resulting from the Company's continued optimization of profitability. As proceeds from existing large-scale government contracts are progressively collected, cash flows are expected to be further bolstered, and overall cash generation

capacity is anticipated to maintain steady growth.

Investing Activities: Cash outflows from investing activities are expected to continue increasing in the future, primarily in connection with equipment and related engineering investments for Plant 1 Phase 2, representing strategic capital expenditures for the Company's capacity expansion and long-term competitiveness enhancement.

Financing Activities: Cash flows from financing activities are expected to remain at a net outflow, primarily due to the continued repayment of bank loans and the distribution of cash dividends and cash from capital surplus in accordance with the Company's earnings distribution policy, reflecting the Company's prudent financial strategy and shareholder return mechanism.

Remedial Measures for Projected Cash Shortfall and Liquidity Analysis: There is no projected cash shortfall, so this is not applicable.

4. Impact of Major Capital Expenditures in the Most Recent Year on Financial and Business Operations

The Company's major capital expenditures in 2022-2023 were mainly for the production line upgrade at Chung Tai Plant 1, mostly funded by own capital or bank financing; the second phase of the first plant construction, launched in May 2024, has a budget of approximately NT$700 million, planned to be funded by a combination of own capital and bank loans.

The building for Plant 1 Phase 2 obtained its certificate of occupancy before the end of 2025. In response to increasingly stringent environmental regulations and ongoing adjustments required by regulatory authorities regarding operational plans, the revenue and profit contribution from Plant 1 Phase 2's retrofitted solid-liquid co-incineration capacity of 40 tonnes per day will be deferred from the originally planned schedule. An additional capital expenditure of approximately NT$300 million is expected to be invested, with a trial operation scheduled for 2028. After obtaining the necessary permits, the Company will seize the opportunity to shorten the construction period and capacity ramp-up phase, intensify equipment testing, process optimization, and customer order planning, positioning Plant 1 Phase 2 as a key growth engine in 2028 to sustainably enhance hazardous waste treatment capacity and operational efficiency.

5. Investment Policy in the Most Recent Year, Main Reasons for Profit or Loss, Improvement Plans, and Investment Plan for the Coming Year

(1) Investment Policy: The Company's investment policy is based on the principle of balancing the developmental needs of its main business and long-term strategic investments, rather than considering short-term financial investments. The relevant implementing departments follow the "Investment Cycle" and "Procedures for Acquisition or Disposal of Assets" of the internal control system. The "Subsidiary Management Regulations" serve as guidelines for business management, implementing supervision and management operations for invested enterprises. All the aforementioned measures or procedures have been discussed and approved by the Board of Directors or shareholders' meetings.

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(2) Main Reasons for Investment Profit or Loss in the Most Recent Year, Improvement Plans, and Investment Plan for the Coming Year:

Unit: NT$ thousand

| Items
Company Name | Shareholding Ratio | Investment Amount | Investee Company's Profit (Loss) for 2025 | Main Reasons for Profit or Loss | Improvement Plan | Investment Plan for the Coming Year |
| --- | --- | --- | --- | --- | --- | --- |
| SMOKING ENVIRONMENTALLY FRIENDLY CORPORATION | 49%
(Note 1) | 45,080 | 24,863 | Commenced sales of heated tobacco products and related merchandise starting from fourth quarter of 2025 | Operations are normal, therefore not applicable. | No plans to increase investment at the moment |
| Chase Sustainability Technology CO., LTD. | 14% | 12,000 | 50,436 | Mainly engaged in waste matching and sustainability services | Operations are normal, therefore not applicable. | No plans to increase investment at the moment |
| CHUNG TAI INVESTMENT CO., LTD (Somoa) | 100% | 8,737 | (24) | Holding investment company | Operations are normal, therefore not applicable. | No plans to increase investment at the moment |
| Da Yuan Company Limited (Note 2) | 15% | 238,550 | (51,947) | Development business is ongoing | In addition to the steady advancement of project-based business, the Company will accelerate the development of service-oriented businesses such as consulting and incineration operation outsourcing, with a view to expanding non-capital-intensive revenue streams, improving overall profit quality, and enhancing operational performance. | No plans to increase investment at the moment |

Note 1: Originally a wholly-owned subsidiary of the Company (100% shareholding). In September of 2025, the Company and other companies jointly invested to develop a merchandise distribution business, with the Company making an additional investment of NT$44,080 thousand. As of December 31, 2025, the Company's equity interest in SMOKING ENVIRONMENTALLY FRIENDLY decreased to 49%. SMOKING ENVIRONMENTALLY FRIENDLY has since been reclassified as a joint venture with another company, and the consolidated entity's interest in SMOKING ENVIRONMENTALLY FRIENDLY is recorded as an investment accounted for using the equity method.
Note 2: Formerly known as CLEANAWAY Co., Ltd. (renamed Da Yuan Company Limited in September of 2025), its Taoyuan development project encountered an administrative dispute in 2024 regarding the recognition of park entry procedures. After the company filed an administrative appeal in accordance with the law, the relevant disposition was revoked by the competent authority and the park entry qualification was reinstated. The disputed matter was fully resolved within 2024. The project is currently continuing to be promoted as planned, and the Company will continue to monitor relevant regulatory changes and respond prudently.

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6. Risk analysis and assessment for the most recent year up to the printing date of the annual report

(1) Impact of interest rate changes, exchange rate fluctuations, and inflation on the Company's profit and loss, and future response measures

Impact of interest rate changes on the Company's profit and loss, and future response measures

The Company's past operations were mainly funded by its own capital. However, recently, for the construction of Chung Tai Plant 1, in addition to raising cash through capital increases from shareholders, the Company has also arranged long-term and short-term loans from domestic banks. Most of the Company's long-term and short-term financial liabilities are at floating interest rates, so rising interest rates may generate higher interest expenses than expected. For the years 2025 and 2024, the net amount of interest income minus interest expenses was NT$(10,852) thousand and NT$(23,106) thousand, respectively.

Unit: NT$ thousand

	2024	2025
Interest income	10,620	9,004
Interest Expense	33,726	27,856

The Company borrows funds at fixed or floating interest rates, thereby creating interest rate exposure. Fixed-rate borrowings expose the Company to fair value interest rate risk; floating-rate borrowings expose the Company to cash flow interest rate risk. The Company's management regularly monitors interest rate risk, and if necessary, will consider taking necessary measures for significant interest rate risks to control the risks arising from market interest rate fluctuations. The carrying amounts of the Company's financial liabilities exposed to interest rate risk at the balance sheet date are as follows:

Unit: NT$ thousand

	2024	2025
With fair value interest rate risk
— Financial assets	561,065	36,475
With cash flow interest rate risk
— Financial assets	58,625	76,844
— Financial liabilities	1,311,019	1,216,886

The following sensitivity analysis is determined based on the interest rate exposure at the balance sheet date. For floating-rate assets and liabilities, the analysis assumes that the amounts of assets and liabilities outstanding at the balance sheet date were outstanding throughout the year. Furthermore, assessing the reasonable possible range of interest rate changes, if interest rates increase or decrease by 1%, with all other variables remaining constant, the Company's pretax net income for the years 2025 and 2024 will decrease or increase by NT$11,400 thousand and NT$12,524 thousand, respectively.

Additionally, the Company obtained qualification approval for the Ministry of Economic Affairs' SME Accelerated Investment Program on October 21, 2019. In February 2020, the Company signed an SME Accelerated Investment Equipment Loan agreement with Hua Nan Commercial Bank with a total limit of NT$762,400 thousand. The contract period is 10 years with a 3-year principal grace period. Upon expiry of the grace period, the loan is being repaid in equal monthly installments starting from March 2023. The Company will make good use of the government-subsidized loan interest preferential period to allocate funds to reduce the impact of interest rate fluctuations.

Impact of exchange rate fluctuations on the Company's profit and loss and future response measures

The Company engages in sales denominated in foreign currencies, which exposes the Company to exchange rate risks due to market exchange rate fluctuations. For exchange rate risk management, the Company regularly reviews its asset and liability positions affected by exchange rates and makes appropriate adjustments to control risks arising from foreign exchange fluctuations.

Sensitivity analysis

The Company is primarily affected by fluctuations in the US dollar exchange rate.

The table below details the Company's sensitivity analysis when the exchange rate of the New Taiwan Dollar (functional currency) increases and decreases by 1% against relevant foreign currencies. 1% is the sensitivity ratio used when reporting exchange rate risks to key management personnel, and also represents management's assessment of the reasonably possible range of foreign currency exchange rate fluctuations. The sensitivity analysis only includes outstanding foreign currency monetary items, and adjusts their translation at the end of the period by a 1% change in exchange rates. The scope of the sensitivity analysis includes items not denominated in the functional currency of the creditor or borrower. The positive numbers in the table below indicate the amount by which pre-tax net income would increase when the New Taiwan Dollar depreciates by 1% relative to each relevant currency; when the New Taiwan Dollar appreciates by 1% relative to each relevant foreign currency, the impact on pre-tax net income or equity would be a negative amount of the same value.

Unit: NT$ thousand

	2024	2025
Impact of US Dollar	1,635	159

*Primarily derived from the Company's outstanding US Dollar denominated cash and cash equivalents, notes and accounts receivable, refundable deposits, and equipment payables as of the balance sheet date.

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Impact of Inflation on the Company's Profit and Loss and Future Response Measures

The Company constantly monitors price changes in the recycling and raw materials markets to reduce the impact of cost fluctuations on the Company's profit and loss.

(2) Policy, Main Reasons for Profit or Loss, and Future Response Measures for Engaging in High-risk, High-leverage Investments, Lending of Funds to Others, Endorsements and Guarantees, and Derivative Transactions

The Company focuses on its core business operations and follows a stable, conservative financial policy. In the most recent fiscal year and up to the printing date of the annual report, the Company has not engaged in any high-risk or high-leverage investments. In addition, the Company has established "Procedures for Lending Funds to Other Parties and Endorsements/Guarantees" and "Procedures for Acquisition or Disposal of Assets," which have been approved by resolution of the shareholders' meeting and serve as the basis for the Company's execution of related transactions. In the most recent fiscal year and up to the printing date of the annual report, except for the explanation below, the Company has not provided endorsements or guarantees for others, nor engaged in derivative transactions.

The Company's Board of Directors resolved on December 18, 2024, to lend funds to CLEANAWAY ENERGY COMPANY LIMITED for its operational needs. The proposed lending amount is NT$250,000,000, with a loan period from January 1, 2025, to June 30, 2025. The loan interest rate is calculated at [Taipei Interbank Offered Rate (TAIBOR) one month +0.91%] per annum, with an interest rate range of approximately 2.3% to 2.7% (for example, as of the end of November 2024, the rate was 2.5019%). Interest will be collected quarterly. As of December 31, 2025, the lending limit has expired, and the principal and interest have been recovered as scheduled.

Pursuant to the resolution of the Company's Board of Directors on October 9, 2025, regarding the fund lending to SMOKING ENVIRONMENTALLY FRIENDLY CORPORATION for its operational needs as a subsidiary investment, the proposed fund lending limit is NT$280,000,000 in total, with the loan period from October 9, 2025 to December 31, 2025, and the loan interest rate calculated at an annual rate of [Taiwan Cooperative Bank's fixed deposit index monthly benchmark rate plus an annual premium of 0.61%], with the interest rate range approximately between 2.100% and 2.556%, with interest collected on a quarterly basis. As of December 31, 2025, the lending limit has expired, and the principal and interest have been recovered as scheduled.

For related regular information disclosure, please refer to the Public Information Observatory > Single Company > Business Overview > Endorsements and Guarantees/Fund Lending > Fund Lending and Endorsements and Guarantees Schedule Information, website: https://mops.twse.com.tw/mops/#/web/t65sb04.

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(3) Future Research and Development Plans and Estimated R&D Expenses

The Company's main business operations include the resource recovery treatment of waste lighting sources and waste printed circuit boards, and has established pyrolysis and incineration treatment facilities, as well as heat recovery power generation systems and bottom ash recycling facilities, providing comprehensive circular economy solutions. In the next three years, the Company plans to invest NT$10,000 to 15,000 thousand in research and development expenses to continuously develop high-value resource recycling technologies; develop processes that maximize resource recovery and reuse, as well as innovative green products and services, striving to become the best partner in the green supply chain for industries.

(4) Impacts and Response Measures for Significant Domestic and Foreign Policy and Legal Changes on the Company's Financial Operations

The Company conducts all operations in compliance with relevant domestic and foreign regulations, constantly monitoring policy development trends and regulatory changes both domestically and internationally. We consult with relevant professionals and collect pertinent information to provide reference for management decision-making, in order to fully grasp and respond to market environment changes, and adjust the Company's operational strategies in a timely manner. In the most recent fiscal year and up to the printing date of the annual report, there have been no significant domestic or foreign policy and legal changes that have had a material impact on the Company's financial operations.

(5) Technological Changes (Including Information Security Risks) and Industry Changes and Their Impact on the Company's Financial Operations and Response Measures

The Company is in the waste treatment industry and constantly monitors relevant technological changes in the industry, stays abreast of market trends to evaluate their impact on company operations, and makes appropriate operational adjustments. In the most recent fiscal year and up to the printing date of the annual report, there have been no significant technological changes or industry changes that have had a material impact on the Company's financial operations.

(6) Impact of Corporate Image Change on Corporate Crisis Management and Response Measures

Since its establishment, the Company has upheld the principles of sustainable operations, corporate social responsibility, and environmental responsibility. We strictly adhere to government regulations, continuously improve our management capabilities, and all colleagues strive to achieve profit targets to fulfill our responsibility to all shareholders. In the future, the Company will be dedicated to advancing toward the goals of circular economy and waste resource recovery. In the most recent fiscal year and up to the printing date of the annual report, there have been no changes in corporate image that have caused corporate crises for the Company.

131

(7) Expected Benefits, Potential Risks, and Response Measures for Mergers and Acquisitions

As of the printing date of the annual report, the Company has no plans to merge with or acquire other companies. In the future, if there are any merger or acquisition plans, they will be handled in accordance with the Company's "Procedures for Acquisition or Disposal of Assets" and will be conducted with a prudent evaluation attitude, fully considering the synergistic effects of the merger, to effectively protect shareholders' interests.

(8) Expected Benefits, Potential Risks, and Response Measures for Plant Expansion

Due to the continuously increasing demand for industrial waste treatment from customers, the Company considered in 2018 that the plant capacity and processing methods could no longer meet customer requirements. To meet medium and long-term operational planning needs, after thorough evaluation, the Company has planned to build a comprehensive industrial waste treatment plant (incineration/chemical/solidification). The Company, in principle, expands its plants and production capacity in phases and stages, with the minimum risk that is financially affordable, while simultaneously ensuring the Company's steady growth and meeting customers' capacity requirements. The newly constructed comprehensive waste treatment center obtained its operating permit in March 2022, and has been positively contributing to the Company's operations and financial performance since 2022. Considering the dynamics of the waste treatment market, the Company has planned to build the Phase 2 project of Plant 1 starting from 2024, transforming the liquid incineration production line into a mixed solid-liquid combustion system, aiming to increase solid waste incineration capacity; adding solid recovered fuel (SRF) preprocessing facilities to increase physical treatment capacity, where the produced solid recovered fuel can be used for generating steam in environmentally friendly boilers or for power generation in emerging power plants.

(9) Risks and Response Measures for Concentrated Procurement or Sales

Regarding procurement:

The Company has established long-term and stable cooperative relationships with its major suppliers, and continues to monitor changes in the supply and demand of raw material markets, actively developing diverse sources of supply to diversify procurement risks. In addition, the Company continues to strengthen its supply chain management mechanism to ensure the stability and flexibility of raw material supply, and the overall risk of purchase concentration remains manageable.

In fiscal year 2025, the top two suppliers were both vendors providing printed circuit board scrap containing metals, with procurement proportions of 18.65% and 12.43% respectively, and the degree of concentration remains within a reasonable range. The third-largest supplier is the related party JI WEI Co., Ltd., accounting for approximately 10.74%, primarily providing landfill-related services. Based on the long-term cooperative relationship and business complementarity, both parties have established a stable foundation for cooperation. Overall, the

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Company's supply sources are reasonably diversified, and there are no significant concentration risks.

Regarding sales:

From fiscal years 2021 to 2024, the Company's major sales targets were metal recycling companies, government agencies, large chemical groups, and waste removal brokerage intermediaries. Excluding the impact of environmental engineering business, the proportion of sales to any single customer relative to net sales was mostly between 10% and 20%, and there was no situation of sales being concentrated among a small number of customers. The Company also continues to maintain existing customer relationships and actively develops new customers. Furthermore, since the Plant 1 processing facility was put into operation in 2022, the scope of business has become more diversified, which helps to diversify customer sources and reduce operational risks.

During fiscal years 2023 to 2024, due to the undertaking of large-scale soil and groundwater pollution remediation projects (environmental engineering business), the largest customer was concentrated in the Public Works Bureau of Kaohsiung City Government; however, such business is project-based revenue with phased characteristics.

In 2025, as the relevant environmental engineering projects entered a transitional period, the Company's revenue structure has returned to being primarily based on routine waste treatment and resource recycling operations, and the distribution of major customers has become more dispersed. In 2025, the sales proportions of the top three customers were 16.92%, 11.06%, and 10.43% respectively, with no single customer accounting for a significantly disproportionate share, and the overall sales concentration remains reasonable and manageable.

(10) Impact, risks, and response measures regarding large-scale transfers or changes in shareholdings by directors, supervisors, or major shareholders holding more than ten percent of shares: None.

(11) Changes in management control and their impact, risks, and response measures: The Company has not experienced any changes in management control during the most recent fiscal year and up to the printing date of this annual report.

(12) Litigation or non-litigation events: The Company should disclose any material litigation, non-litigation, or administrative disputes that have been finalized by judgment or are still pending involving the Company, its directors, supervisors, president, de facto responsible persons, major shareholders with shareholding exceeding ten percent, and subsidiaries, where the outcome may have a significant impact on shareholders' equity or securities prices. Such disclosure should include the disputed facts, monetary amount involved, litigation commencement date, main parties involved, and the handling status up to the printing date of this annual report: There are no material litigation or non-litigation events whose outcomes may have a significant impact on shareholders' equity or securities prices.

(13) Other significant risks and response measures: None.

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VI. Special Recorded Items

Affiliated Enterprise Information: The most recent annual Consolidated Business Report of Affiliated Enterprises, Consolidated Financial Statements of Affiliated Enterprises, and Affiliation Report prepared in accordance with the "Regulations Governing the Preparation of Consolidated Business Reports of Affiliated Enterprises, Consolidated Financial Statements of Affiliated Enterprises, and Affiliation Reports" established by this Commission

Please refer to the Market Observation Post System > Single Company > Electronic Document Download > Affiliated Enterprise Documents Section, website https://mopsov.twse.com.tw/mops/web/t57sb01_q10.

For the most recent year and up to the printing date of the annual report, the status of private placement of securities: Not applicable.
Other necessary supplementary information: None.

VII. Significant Impact Events

For the most recent year and up to the printing date of the annual report, any matters specified in Paragraph 3, Subparagraph 2, Article 36 of the Securities and Exchange Act that might have a significant impact on shareholders' equity or securities prices: None.

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229

Chung Tai Resource Technology Corp.

Chairman: Cheng, Kuang-Chieh

AI assistant

ctrt — Annual Report 2025

52663_rns_2026-05-13_4f20e82f-9249-4000-b8ff-8c5b7f182374.pdf

2025 Annual Report

中台資源科技股份有限公司

CHUNG TAI RESOURCE TECHNOLOGY CORP.

CONTENTS

V. Review and Analysis of Financial Status, Operating Results, and Risk Factors ... 122

VI. Special Recorded Items ... 134

VII. Significant Impact Events ... 134

2. Industry Trends and Development Opportunities for 2026

II. Corporate Governance Report

1. Information on Directors, President, Vice Presidents, Assistant Managers, and Heads of Departments and Branches

(1) Directors' Information

3. Remuneration of President and Vice President

2. Corporate Governance Operations

(1) Board of Directors Operations

3. Certified Public Accountant Fee Information

4. Change of CPA information: Not applicable.

2024 Cash Capital Increase

1. Plan Details

IV. Operational Overview

1. Business Content

(1) Business Scope

A. Industrial Waste Industry

Industrial Waste Treatment Status Over the Past Five Years

B. Waste Lighting Industry

C. Waste Printed Circuit Board Industry

D. Soil and Groundwater Environmental Remediation Engineering Industry

2. Market and Production/Sales Overview

(1) Market Analysis

1. Main Product (Service) Sales (Provision) Regions

2. Market Share

(1) Recycling and Treatment of Waste Lighting

02 ERP物料管理系統

03 車輛軌跡監控圖台、行車視野輔助系統

04 事業廢棄物清運處理平台

B. PC Board Industry Fluctuations Affecting Raw Material Supply

Response Strategies:

C. Copper Price Market Fluctuations Affecting Copper Powder Sales

Response Strategies:

(2) Main Products' Important Uses and Production Processes

1. Important Uses of Main Products (Post-Treatment Derivatives)

2. Production Process

(1) Integrated Waste-to-Energy and Resource Recovery Treatment

3. Information on employees in the last two years and up to the printing date of the annual report

4. Environmental protection expenditure information

5. Labor-Management Relations

4. Status of labor-management agreements

5. Status of various employee rights protection measures

6. Information Security Management

2. Financial Performance Comparative Analysis Table

3. Cash Flow Comparison Analysis Table

4. Impact of Major Capital Expenditures in the Most Recent Year on Financial and Business Operations

5. Investment Policy in the Most Recent Year, Main Reasons for Profit or Loss, Improvement Plans, and Investment Plan for the Coming Year

6. Risk analysis and assessment for the most recent year up to the printing date of the annual report

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ctrt Annual Report 2025