DAVICOM — AGM Information 2022

Jul 6, 2022

DAVICOM Semiconductor, Inc.

Year 2022

Annual Shareholders’ Meeting Minutes

Time ： 9:00 a.m., Jun. 29, 2022 (Wednesday)

Venue ： Auditorium, DAVICOM Semiconductor, Inc.

(3F., No.6, Li-Hsin Rd.6, Science Park, Hsinchu, Taiwan)

The number of shares of attendance ：

Attending shareholders and proxy represented 44,461,270 shares, accounting for 54.40% of the Company’s total outstanding shares 81,717,089.

Chairman ： Mr. Ting Hao

Recorder ： Ms. Chu-Mei Lin

Others present ：

Independent Director ： Chang-Yue Ueng, Niang-Shou Wei, Jen- Jyh Hwang Director ： Wen-Chen Lin, Cheng- Feng Chiu PWC CPA ： Se-Kai Lin

I 、 Call Meeting to Order ：

The aggregate shareholding of the shareholders presents in person or by proxy constituted a quorum. The Chairman called the meeting to order.

II 、 Chairman’s Address ： Omitted.

III 、 Report Items ：

1. To report the business of 2021 and operating plan of 2022

• Explanatory Notes ：Please refer to the Chinese version of the 2022 Annual General Shareholders’ Meeting Handbook on Page 7-8.

2. Audit Committee’s review report of 2021

• Explanatory Notes ： Please refer to the Chinese version of the 2022 Annual General Shareholders’ Meeting Handbook on Page 9.

3. To report the directors’ remuneration policy and 2021 directors and employees’ compensation distribution

• Explanatory Notes ：

• (1) The directors’ remuneration policy: Please refer to the Chinese version of the 2022 Annual General Shareholders’ Meeting Handbook on Page 31.

• (2) The pre-tax profits of 2021 is NT$90,408,377 and according to the Company’s Articles of Incorporation, the Board has adopted a proposal for distribution of 2021 profit as follows: directors’ compensation is NT$1,808,167 and the profit to employees is NT$ 7,684,712; both shall be paid in cash.

• (3) The implementation of the distribution will be conducted after being approved by the shareholders’ meeting.

• (4) Please refer to the Chinese version of the 2022 Annual General Shareholders’ Meeting Handbook on Page 31.

4. To report Implementation Status of the Company’s Share Buyback Explanatory Notes ：

• (1) Implementation Status of the 2020 Company’s Share Buyback The Company purchased 1,400,000 shares common stock from Mar. 02, 2020 to May 01, 2020. Total monetary amount of shares buyback was NT$ 22,758,483. The ratio is 1.68% of cumulative number of own shares held during the buyback period to the total number of the Company’s issued shares.

• (2) On April 11, 2022, the board of directors approved the revision of the company's first repurchase of treasury shares in 2020 to transfer employees. Please refer to the Chinese version of the 2022 Annual General Shareholders’ Meeting Handbook on Page 32.

DAVICOM Semiconductor, Inc.｜Handbook for the 2021 Annual Shareholders’ Meeting

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IV 、 Approval and Discussion Item ：

Proposal 1 (Proposed by the Board of Directors)

Subject ： To accept 2021 Business Report and Financial Statements

Explanatory Notes ：

• (1) DAVICOM’s 2021 Business Report, Financial Statements, including Balance Sheets, Statement of Comprehensive Income, Statements of Changes in Equity, and Statements of Cash Flows, were audited by independent auditors, Mr. Se-Kai Lin and Mr. Chia-Hung Lin, of PricewaterhouseCoopers, Taiwan.

• (2) 2021 Business Report, Independent Auditors’ Report, and the aforementioned Financial Statements are attached hereto as Attachments. Please refer to the Chinese version of the 2022 Annual General Shareholders’ Meeting Handbook on Page 7-8 and Page 10-30.

• Resolution ：The result is as follows

  • Approval votes：44,013,055., 99.10% of total votes 44,410,270. Disapproval votes：26,302., 0.05% of total votes 44,410,270. Abstention votes：370,913., 0.83% of total votes 44,410,270. The proposal was approved.

Proposal 2 (Proposed by the Board of Directors)

Subject ： To approve the proposal for distribution of 2021 earnings

Explanatory Notes ：

• (1) 2021 net profit after tax is NT$ 69,662,403. To make up the actuarial loss of the pension and to allocate 10% of the statutory surplus reserve, the proposed dividend to shareholders is NT$39,796,222. Each shareholder will be entitled to receive a cash dividend of NT$0.487 per share.

• (2) In the event of any change in the number of outstanding shares resulting from executing employee stock options or converting treasury stock to its employees, the dividend ratio must be adjusted. It is proposed to fully authorize the Chairman of Board of Directors of DAVICOM to adjust the dividend ratio and to proceed on the relevant matters.

• (3) Upon the approval of the Annual Meeting of Shareholders, it is proposed that the Board of Directors be authorized to resolve the ex-dividend date and other relevant issues.

• (4) Please refer to the Chinese version of the 2022 Annual General Shareholders’ Meeting Handbook on Page 33.

Resolution ：The result is as follows

• Approval votes：44,018,055., 99.11% of total votes 44,410,270. Disapproval votes：28,297., 0.06% of total votes 44,410,270 Abstention votes：363,918., 0.81% of total votes 44,410,270 The proposal was approved.

DAVICOM Semiconductor, Inc.｜Handbook for the 2021 Annual Shareholders’ Meeting

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V 、 Discussion Item ：

Proposal 1 (Proposed by the Board of Directors)

Subject ： To approve the proposal for additional cash distribution of 2021 from its reserved surplus earnings.

Explanatory Notes ：

• (1) Based on the profit allocation proposal, the Company intends to declare cash dividends in the amount of NT$41,920,867 at NT$0.513 per share from its distributable reserved surplus earnings for the year 2021.

• (2) In the event of any change in the number of outstanding shares resulting from executing employee stock options or converting treasury stock to its employees, the dividend ratio must be adjusted. It is proposed to fully authorize the Chairman of Board of Directors of DAVICOM to adjust the dividend ratio and to proceed on the relevant matters.

• (3) Upon the approval of the Annual Meeting of Shareholders, it is proposed that the Board of Directors be authorized to resolve the ex-dividend date and other relevant issues.

• Resolution: The result is as follows

  • Approval votes：44,027,006., 99.13% of total votes 44,410,270. Disapproval votes：13,346., 0.03% of total votes 44,410,270. Abstention votes：369,918 0.83% of total votes 44,410,270. The proposal was approved

Proposal 2 (Proposed by the Board of Directors)

Subject ： To approve amendments to partial provisions of Articles of Incorporation

Explanatory Notes ：

The revised Rules of Articles of Incorporation, please refer to please refer to the company’s Chinese version of the 2021 Annual General Shareholders’ Meeting Handbook p.39~42.

Resolution ：The result is as follows

• Approval votes：44,010,997., 99.10% of total votes 44,410,270.

• Disapproval votes：28,363., 0.06% of total votes 44,410,270. Abstention votes：370,910., 0.83% of total votes 44,410,270. The proposal was approved

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Proposal 3 (Proposed by the Board of Directors)

Subject ： To approve amendments to partial provisions of Operational

Procedures for Loaning Funds to Others and Operational Procedures for Endorsements/Guarantees

Explanatory Notes ：

• (1) The public company has established an Audit Committee in accordance with Article 14-5 of the Securities and Exchange Act of the terms of reference of the Audit Committee. The setting or revising of the Operational Procedures for Loaning Funds to Others and the Operational Procedures for Endorsements/Guarantees shall be approved by the Audit Committee.

• (2) In order to strengthen corporate governance, public companies that have established independent directors and audit committees shall notify independent directors and audit committees in writing of major violations of Loaning Funds or endorsement guarantees; Improvement plans should also be sent to independent directors and the audit committee.

• (3) Comparison Table of the Amendment to the Operational Procedures for Loaning Funds to Others and Operational Procedures for Endorsements/Guarantees, please refer to the company’s Chinese version of the 2022 Annual General Shareholders’ Meeting Handbook p.36~37.

• Resolution: The result is as follows

  • Approval votes：44,008,025., 99.09% of total votes 44,410,270. Disapproval votes：31,357., 0.07% of total votes 44,410,270. Abstention votes：370,888., 0.83% of total votes 44,410,270. The proposal was approved

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VI 、 Election Item ：

Proposal (Proposed by the Board of Directors)

Subject ： To elect the 10th board of directors (4) and independent directors (3). Explanatory Notes ：

• (1) The Shareholders’ Meeting will elect the 10th board of directors (4) and independent directors (3). The term of the newly elected board of directors is from 2022/06/29 to 2025/06/28 (3 years). The candidate’s nomination system of Company Act 192-1 is adopted by the company for the election of the directors of the company, and the shareholders shall elect the directors from among the nominees listed in the roster of director candidates. Please refer to the company’s Chinese version of the 2022 Annual General Shareholders’ Meeting Handbook p.38.for director candidates’ education and work experience.

• (2) The result of election：

==> picture [387 x 221] intentionally omitted <==

----- Start of picture text -----

Shareholder
Account No.
Title Name Votes
or
ID No.
Director 2 Ting Hao 52,988,628
Director 1770 Goodyears Investments Ltd. 47,813,066
Director 37760 Tzay Hua Ltd. 45,602,230
Director 32654 Yun-Ping Lin 43,813,041
Independent
1752 Chang-Yue Ueng 41,904,400
Director
Independent
1748 Jen-Jyh Hwang 37,915,878
Director
Independent
286 Niang-Shou Wei 36,439,983
Director
----- End of picture text -----

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VII 、 Other Discussion Item ：

Proposal (Proposed by the Board of Directors)

Subject ： The proposal of the release of the non-compete restrictions on the 10th new elected of directors and independent directors.

Explanatory Notes ：

• (1) The company would like to release the non-compete restrictions on the 10th new elected of directors and independent directors.

• (2) Please approve.

The list of release is as below：

Directors/Independent Directors	Name	Work Experience
The release of non- compete restrictions on the new elected of directors	Ting Hao	Independent Director of United Integrated Service Co. and MiTAC Holdings Corp.
	Goodyears Investments Ltd.	Director of the company’s 10th board of director
	Tzay Hua Ltd.	Director of the company’s 10th board of director
	Yun-Ping Lin	Director of the company’s 10~~th~~ board of director Owner of Sane Way Enterprises Co.. Ltd. Owner of CrownStar International Investment Co., Ltd.
The release of non- compete restrictions on the new elected of independent directors	Chang-Yue Ueng	Director of the company’s 10~~th~~ board of director Finance manager of Kwo Ger Metal Technology Inc.
	Jen-Jyh Hwang	Director of the company’s 10~~th~~ board of director Adjunct Associate Professor of Dept. of Mechanical and Electro Mechanical Engineering National Sun-Yatsen University Independent Director of JG Environmental Technology

Resolution ：The result is as follows

Approval votes：44,021,639., 99.01% of total votes 44,461,270. Disapproval votes：51,510., 0.11% of total votes 44,461,270. Abstention votes：388,121., 0.87% of total votes 44,461,270. The proposal was approved

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VIII 、 Motions ： None

IX 、 Adjournment ：

Time：09:41 a.m.

Please refer to the Chinese Version of the 2022 Annual General Shareholders’ Meeting Handbook for further information. http://www.davicom.com.tw/pdf/ir/irsbp4s03dl2-E.pdf

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