DE LICACY - AGM Information 2021 | FinancialReports.eu

Stock code ： 1464

DE LICACY INDUSTRIAL CO., LTD.

Shareholders’ Meeting in 2021 Meeting Agenda

June 10, 2021 No. 240, Sanshe, Xinshi Dist., Tainan City

DE LICACY INDUSTRIAL CO., LTD.

Table of Content of Meeting Agenda of Shareholders’ meeting in 2021 Meeting agenda

Announcements

Report on the allocation of Directors' remuneration and Employee bonus stock in 2020…………………………………………………………..…… 1 2. 2020 Annual Business Report……………………………………………… 2 3. Report of the 2020 final accounts reviewed by the Audit Committee………………………………………………………………..… 5 4. Report on investment in China………………………………………………………………….….… 6 5. Report of the company’s endorsements and guarantees…………………………………………………………………... 7 Acknowledgement 1. 2020 business report and proposals for ratification of individual financial statements and consolidated financial statements………………………….. 9 2. 2020 proposals for ratification of deficit compensated……………………………………………………………..… .30 Discussion matters 1. Amend the matters for deliberation of the "Rules of Procedures for Shareholders' Meetings" of the company…………………………………..31 2. Discussion of Capital reserve's cash distribution…………………………. 34 ……………………………………………………...…35 Extraordinary motions Articles Articles of incorporation……………………………………………………….…36 Rules of Procedure for Shareholders Meetings (Before amendment) ………….. 43 Appendix Impact of the Proposed Bonus Shares on the Company's Operating Performance and Earnings per Share …………………………………………………….……51 Shareholding of all directors …………………………………………………… 52

DE LICACY INDUSTRIAL CO., LTD. Meeting Agenda of Shareholders’ meeting in 2021

Time ： 9:00 am on Thursday, June 10, 2021

Location: No. 240, Sanshe, Xinshi Dist., Tainan City (The first floor of the company's employee activity center)

Meeting procedure:

Start of the meeting (report on the number of shareholders present)
Chairman's Statement

3. Announcements

(1).Report of the allocation of Directors' remuneration and Employee bonus stock in 2020
(2).2020 Annual Business Report
(3).Report of the 2020 final accounts reviewed by the Audit Committee
(4).Report of investment in China
(5).Report of the company’s endorsements and guarantees
Acknowledgement
(1).2020 business report and proposals for ratification of individual financial statements and consolidated financial statements
(2).2020 proposals for ratification of deficit compensated
Discussion matters
(1).Amend the matters for deliberation of the "Rules of Procedures for Shareholders' Meetings" of the company
(2).Discussion of Capital reserve's cash distribution
Extraordinary motions
Adjournment

Announcements

Case 1:

Cause of action: Report of the allocation of Directors' remuneration and Employee remuneration in 2020.

Explanation: 1. According to the articles of incorporation of the company: if the company makes profits for the year, it shall allocate no less than 4% as employee remuneration, which shall be distributed in stock or cash by the resolution of the board of directors, and the payment shall be paid to employees of subsidiary companies who meet certain conditions; The above-mentioned opening profit amount shall be allocated not more than 3% as director's remuneration by the resolution of the board of directors.
The company's net loss of NT$207,286,476 in 2020, therefore does not issue Employee bonus stock and Directors' remuneration.
This case was reviewed and approved by the third remuneration committee of the fourth session on March 15, 2021 and approved by the sixth meeting of the seventeenth session of the board of directors on March 15, 2021.

Case 2 ：

Cause of action: 2020 Annual Business Report

Explanation:

2020 Annual Business Report

1.Business report of the previous year (2020)

(1) Implementation results of the business plan:

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Unit: Thousand New Taiwan Dollars
Year
Increase
2020 2019 (decrease) The proportion
Item of changes%
amount
Net sales revenue 8,407,460 10,533,526 ( 2,126,066) (20.18)
Other operating income 187,199 386,198 ( 198,999) (51.53)
Total operating income 8,594,659 10,919,724 ( 2,325,065) (21.29)
Operating cost 7,350,952 8,865,307 ( 1,514,355) (17.08)
Operating margin 1,243,707 2,054,417 ( 810,710) (39.46)
Unrealized sales benefit ( 26) - ( 26) (100.00)
Realized operating margin 1,243,681 2,054,417 ( 810,736) (39.46)
Marketing cost 471,947 576,654 ( 104,707) (18.16)
Management cost 490,694 475,357 15,337 3.23
Research and development
208,459 231,949 ( 23,490) (10.13)
cost
Loss of expected credit
60,043 24,314 35,729 146.95
impairment
Total operating costs 1,231,143 1,308,274 ( 77,131) (5.90)
Other income and net
( 9,383) 55,618 ( 65,001) (116.87)
expenses
Operating profit 3,155 801,761 ( 798,606) (99.61)
Total non-operating income
( 294,957) ( 134,874) ( 160,083) (118.69)
and expenses
Net profit before tax (net
( 291,802) 666,887 ( 958,689) (143.76)
loss)
Income tax expense
( 85,169) 52,424 ( 137,593) (262.46)
(benefits)
Net profit (net loss) for the
( 206,633) 614,463 ( 821,096) (133.63)
year
Other comprehensive profit
( 17,771) ( 113,896) 96,125 84.40
and loss (net after tax)
Total comprehensive profit
( 224,404) 500,567 ( 724,971) (144.83)
and loss for the year
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Overview of production and sales:

① Production ： The production of spun fabric in 2020 is 12,771 thousand yards, a negative growth of 34.96% compared to 2019's 19,636 thousand yards. Filament

fabric is 121,748 thousand yards, which is a negative growth of 20.60% compared to 2019's 153,342 thousand yards.

② Sales ： In 2020, the sales of spun fabric was 12,439 thousand yards, which was a

negative growth of 33.29% compared to 2019's 18,647 thousand yards. Filament fabric was 112,305 thousand yards, which was a negative growth of 25.67% compared to 2019's 151,098 thousand yards.

(2) Budget execution status: Not applicable

(3) Analysis of financial income and expenditure and profitability:

Unit: ％

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Item 2020 2019
Debt-to-asset ratio（%） 69.44 66.63
Financial
The ratio of long-term funds to
structure 145.82 153.51
fixed assets（%）
Current ratio（%） 111.66 120.12
Solvency Quick ratio（%） 68.52 72.24
Interest coverage ratio (0.64) 4.24
Return on assets（%） (0.33) 4.43
Return on equity（%） (3.53) 10.70
Business
0.08 20.85
Percentage of paid-in interest
Profitability
capital（%） Net profit
(7.59) 17.34
before tax
Net profit rate（%） (2.40) 5.63
Earnings per share (NTD) (0.54) 1.61
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(4) R&D development status:

① .R&D expenses invested each year as of April 30, 2021 and recent years

	2020	The current year ends on April 30, 2021
Expense	208,459 thousand NTD	64,802thousand NTD
% Of turnover	2.43%	1.97%

② .Successfully developed products in 2020

(A) DOUBLE FACE FLEECE

(B) NYLON ATY WITH STRETCH PANTS

(D) EVOLUTION FLEECE 2.0

(E) YARN DYED PI TECH SHIRTS.

(F) NYLON ANTI-BACTERIAL FUNCTIONAL FIBER WITH STRETCH SHIRTS

(G) RECYCLE ANTI PILLING FLANNEL.

(H) 2-LAYER LAMINATION RE-TPU FILM

( I ) 3-LAYER LAMINATION RE-TPU CLEAR FILM

( J) NATURAL FIBER BLENDED FABRIC WITH OIL-WAX COATING AND PRINTING VINTAGE OUTLOOKS

2.Summary of this year's business plan (2021)

The business policy in 2021 is mainly to develop environmentally friendly, functional and

fashionable products that meet environmental requirements, and actively cooperate with upstream raw material manufacturers to develop new environmentally friendly materials and auxiliaries, and integrate our factory's false twist, weaving, dyeing and finishing processing and processing. Innovative technology for post-processing, laminating, coating, and other equipment to enhance product quality and added value. Efforts to transform the production technology, in terms of spun fabric: 1. Production of filament YD cloth. 2. Fine count cotton fabric. 3. Produce new spun and filament blended fabric. Functional products that combine fashion, leisure and comfort. In terms of filament fabric: Focus on high-tech innovation, and produce functional products that are lighter, thinner, more flexible, comfortable, and environmentally friendly.

(1).Business policies and important production and sales policies:
① . Strengthen the interaction with brand customers, and directly cooperate with final
buyers, increase business sales and single source stability, and actively grasp the main and potential customer groups.
- ② . The promotion of core products strengthens the control of the channels of garment factories.
- Filament product：Elastic shirt fabric, soluble yarn, fleece 。
- Spun product：Elastic shirt cloth,flannel,Interlacing dyed cloth。
- ③ . Deeply cultivate functional furnishing fabrics, clothing fabrics, SPORT fabrics and OUTDOOR fabrics. Furnishing fabrics focus on China, Northern Europe, and Italy, and focus on BVB yarn and woolen yarn. The clothing market focuses on the top brands in North America and Europe, with sports, casual and fashion.
④ Enhance R&D and innovation capabilities, strengthen product planning, improve quality and accelerate the development of differentiated products (especially in response to the exemption of garment tariffs from the seven ASEAN countries), and cultivate the rapid and flexible market response capabilities of business personnel and R&D personnel.
- ⑤ Committed to the research and development of leisure products and expanding the market in the field of sports and leisure, research and development of the latest materials such as: high elasticity and high resilience elastic processing yarn, Tencel cotton processing silk, embossed appearance fabric material, wool processing silk and so on.
- ⑥ The De Licacy factory in Vietnam mainly: (1) In order to cooperate with the Japanese market’s ASEAN exemption from customs duties, the main supplier UNIQLO focuses on leisure and home wear, supplemented by the +J series product designer joint models; (2) With Vietnamese clothing manufacturers Strengthen cooperation with Vietnamese companies, supply Vietnamese materials to Vietnamese garment factories, with shortened delivery time and fast service as the largest niche; (3) Technical cooperation with Japanese trading companies, the more Japanese companies send personnel to field technology & quality control, and the higher the level of follow-up Japanese customers have the same requirements.
(2).Expected sales quantity and its basis (the following expected sales volume is estimated by the business department based on the current economic situation):

Main product	Filament fabric	Spun fabric
Expected sales quantity this year	166,208 Thousand yards	19,580 Thousand yards

Person in charge: Ye Jiaming Manager: Ye Weili Accounting Supervisor: You Yineng

Case 3 ：

Cause of action: Report of the 2020 final accounts reviewed by the Audit Committee. Explanation: The company’s 2020 financial statements were approved by the board of directors and completed after the accountant’s review. Together with the business report and statements of deficit compensated, they were sent to the audit committee for review and a review report was submitted.

DE LICACY INDUSTRIAL CO., LTD.

Audit Committee Approval Report

The audit committee agreed and passed the resolutions of the board of directors of the company’s 2019 business report, financial statements, and loss compensation proposals, including financial statements (balance sheet, consolidated income statement, statement of changes in equity, cash flow statement) and consolidated financial statements. The report was issued by the board of directors of Deloitte Touche Tohmatsu Limited’s accountants Yang Chaoqin and Li Jizhen to audit the completion of the visa, and issued an unqualified opinion plus other paragraphs of the audit report. The Audit Committee is responsible for supervising the company's financial reporting process.

The certified accountant visas the company's 2020 financial statements and communicates with the audit committee on the following matters:

There are no major findings in the inspection scope and time planned by the certified public accountant.
The certified public accountant provided the audit committee with the personnel of the accounting firm's affiliated firm subject to independence regulations, and has complied with the statement of independence in the professional ethics of accountants, and has not found other relationships that may be considered to affect the independence of accountants and other matters.
The certified public accountant communicates with the audit committee on key audit matters, and the key audit matters that must be communicated in the audit report have been included in the audit report.

The company’s 2020 financial statements, business reports, and loss compensation proposals approved by the audit committee and approved by the board of directors are in compliance with relevant laws and regulations. A report is prepared in accordance with Article 219 of the Company Act.

Please verify Sincerely

DE LICACY INDUSTRIAL CO., LTD. 2021 shareholders meeting

Independent director: Huang Junren

Su Baicheng

Cai Qijun

March 15, 2021

Case 4:

Cause of action: Report of investment in China, for your honor's approval.

Explanation: 1.Approved by the 19th meeting of the 14th session of the Board of Directors on January 16, 2014, participating in the investment and establishment of overseas companies and indirect investment in China, the relevant details of this investment case authorized the chairman to be within the limit of RMB$220 million to take full responsibility.

The description of this investment case is as follows:

(1) Investment method:
Vantage Gain Holdings Limited (Poly Group Corporation Ltd.) was acquired by De Licacy (Samoa) Holdings Co., a 100%-owned
subsidiary of the company, holding 73.33% of the shares. Vantage Gain Holdings Limited reinvested in PERFECT STEP INVESTMENTS LIMITED, holding 20% of the shares. PERFECT STEP INVESTMENTS LIMITED indirectly invested in De Licacy
(Shanghai) Industrial Co., Ltd. through Shinyong International Co., Ltd., NEW HAO ENTERPRISE CO., LTD. and other legal entities, holding 100% of the shares.
(2) investment amount:
Investment funds remitted to PERFECT STEP INVESTMENTS
LIMITED
USD 1,650,000 (NTD 49,597,350) invested on June 20, 2014
USD 1,629,850 (NTD 48,732,515) invested on September 9, 2014 USD 3,572,400 (NTD 113,548,734) invested on December 24, 2014 USD 360,000 (NTD 11,435,400) invested on October 20, 2016 USD 356,575 (NTD 10,777,479) invested on August 7, 2017 USD 350,212 (NTD 10,712,985) invested on September 27, 2018 USD 440,000 (NTD 13,649,240) on September 23, 2019 USD 285,800 (NTD 8,609,725) invested on December 30, 2019 USD 217,200 (NTD 6,375,037) invested on September 9, 2020 USD 1,199,660 (NTD 34,082,341) invested on January 27, 2021
(3) This case was approved in principle by the No. 10400285270 Letter of Shen Er Zi No. 10400285270 on March 30, 2016 by the Investment Review Committee of the Ministry of Economic Affairs.
2.On March 15, 2021, the Sixth Session of the Seventeenth Board of Directors tentatively agreed that De Licacy (Samoa) Holdings Co., LTD., a subsidiary of the company's capital increase, would reinvest in BEST ALLIANCE INTERNATIONAL LIMITED, and then invest in Jiangsu Province, China, and set up 1-2 companies. This investment case is a new investment case due to Hangzhou DE LICACY INDUSTRIAL CO., LTD. and Zhejiang LUCKY UNIQUE ENT. CO., LTD.’s proposed demolition, relocation or name change. The relevant details of this investment case authorize the chairman to full processing within the USD 60 million quota.

Case 5:

Cause of action: Report of the company’s endorsements and guarantees, for your honor's approval.

Explanation: 1. As of March 31, 2021, the company's overview of the endorsement guarantee:
(1) Objects of endorsement guarantee: CHADTEX INDUSTRIAL CO., LTD. is a 55.06%-owned subsidiary; Zhejiang LUCKY UNIQUE ENT. CO., LTD., TOTAL EXPRESS LIMITES and APEX (ANQING) TEXTILE CO., LTD. are comprehensively held 53.22 % Subsidiary; Victory Cayman Holdings Co., Ltd., Hangzhou DE LICACY INDUSTRIAL CO., LTD., EDEN ROAD TERNATIONAL LTD., Hong Kong EDEN ROAD INTERNATIONAL LTD., DE-FA INTERNATIONAL INDUSTRIAL CO., LTD., New Lake Co., Ltd. Eleven companies including the company and Vietnam DE LICACY INDUSTRIAL CO., LTD. are 100%-owned subsidiaries.
(2) The total amount of endorsement guarantee : NTD 4,611,344 thousand.
(3) Purpose of endorsement guarantee: to provide endorsement guarantee for subsidiary loans.
(4) Based on the net value of the financial statements on December 31, 2020, the total limit of the company's external endorsement guarantee and the limitof the single company's endorsement guarantee are NT$7,056,476 thousand and NT$2,352,159, respectively. The company's endorsement guarantees are handled in accordance with
the "Endorsement Guarantee Operation Procedures", and there is no case that exceeds the prescribed limit.

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Endorsement guarantee
amount
Item The name of the company endorsed
(New Taiwan Dollar in
Thousand)
1 CHADTEX INDUSTRIAL CO., LTD. 80,000
2 De Shen (Cayman) Holding Co., Ltd. 882,880
3 Hangzhou DE LICACY INDUSTRIAL CO., LTD. 452,060
4 EDEN ROAD INTERNATIONAL LTD. 455,680
5 [DE-FA INTERNATIONAL INDUSTRIAL CO., ] 278,360
LTD.
6 New Lake Co., Ltd. 1,011,040
7 Vietnam DE LICACY INDUSTRIAL CO., LTD. 959,080
8 Zhejiang LUCKY UNIQUE ENT. CO., LTD. 207,383
9 TOTAL EXPRESS LIMITED 27,491
10 [Hong Kong EDEN ROAD INTERNATIONAL ] 213,600
LTD.
11 APEX (ANQING) TEXTILE CO., LTD. 43,770
Total 4,611,344
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2.The company is the operating headquarters of the group. In recent years, with the rise of sports trends, the momentum for related
customers to place orders has increased. With the development of business and the continuous expansion of revenue scale, the capital
required for operations has increased relatively. The company’s share capital is only NTD$ 3.8 billion. With limited self-owned funds, it is necessary to borrow from the bank to meet the funding needs of daily operations and purchase of materials. However, if all subsidiaries of the group need to raise funds from financial institutions for working
capital, the company shall be responsible for joint guarantees, so that they can apply for short-term financing lines from banks. In anticipation that the funds required for future operations will continue to rise, the company will continue to provide Bank financing and borrowing methods to meet the required funds.
3.As of March 31, 2021, the subsidiary has no endorsement guarantee.

Acknowledgement

Case 1: Board of Directors

Cause of action: According to the company’s 2020 business report and individual financial statements and consolidated financial statements, please acknowledge it.
Explanation:1.The company’s 2020 financial statements were approved by the board of directors and completed after the accountant’s review. Together with the business report and statements of deficit compensated, they were sent to the audit committee for review and a review report was submitted.
2.For the 2020 business report, please refer to pages 2 to 4 of this meeting handbook, and for the accountant's audit report and financial statements, please refer to pages 10 to 29 of this meeting handbook.

Resolution:

Accountant's Audit Report

Dear the Board of Directors and Shareholders of De Licacy Industrial Co., Ltd.

Opinion

We have audited the accompanying financial statements of De Licacy Industrial Co., Ltd (the “De Licacy Group”), which comprise the individual balance sheets as of December 31, 2020 and 2019, and the individual statements of comprehensive income, individual statements of changes in equity and individual statements of cash flows for the years then ended, and the notes to the individual financial statements, including a summary of significant accounting policies.

In our opinion, which is based on our and other accountants’ auditing results (please refer other matters section) and accompanying financial statements present fairly, in all material respects, the financial position of the De Licacy Group as of December 31, 2020 and 2019, and its financial performance and its cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards (“IFRS”), International Accounting Standards (“IAS”), Interpretations of IFRS (“IFRIC”), and Interpretations of IAS (“SIC”) endorsed by the Financial Supervisory Commission (“FSC”) of Taiwan, the Republic of China (“ROC”).

Basis of Opinion

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

Key Audit Matter

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements for the year ended December 31, 2020. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. The descriptions of the key audit matter of the 2020 individual financial statements of the De Licacy Group are as follows:

As stated in Note 4-5 Inventories, Note 5 inventory obsolescence loss and Note 11 Inventories to the individual financial Statements, De Licacy inventories amounted to NT$1,371,756,000 as of December 31, 2020, which accounted for 10% of the total individual assets.

Due to the book value of inventory is significant to the overall individual financial reports, and the evaluation of dull and obsolete inventory involves significant judgment of the management, the evaluation of dull inventory is listed as a key audit item.

The accountants’ reasonable assessment of obsolete inventory is as follows:

1.Understand and evaluate the effectiveness of the design and implementation of the internal inventory control system.
2.Assess the year-and the inventory age, verify the accurancy of the inventory age classification, and then recalculate if it should include loss of obsolete inventory
3.Conduct stocktake at the end of the year and confirm and assess whether the stock is out of date or damaged.

Other Matters

The financial statements included in the individual financial statements of Deloitte Touche Tohmatsu, Inc. and its investee company. Accordingly, our opinion on the individual financial statements referred to above, which relates to the amount of the aforementioned investment and its comprehensive income and loss, was based on the audited reports of other auditors. The above investments accounted for by the equity method amounted to $46,459,000 and $96,773,000 as of December 31, 2020 and 2019 respectively, representing less than 1% and 1% of the total individual assets. The individual loss recognized under the equity method amounted to $50,314,000 and $28,489,000 for the years ended December 31, 2020 and 2019, respectively, which accounted for (21%) and (6%) of the individual total profit or loss.

Management's and Governance's Responsibility for the Individual Financial Statements

Management's responsibility is to prepare individual financial statements in conformity with the Guidelines Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards, International Accounting Standards, and Interpretations and Interpretations issued by the Financial Supervisory Commission, and to maintain such internal control relevant to the preparation of individual financial statements as is necessary to enable the preparation of individual financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the individual financial statements, management's responsibility also includes assessing the ability of the Group to continue as a going concern, the disclosure of related matters, and the adoption of the going concern basis of accounting, unless management intends to liquidate the Group or cease operations, or there is no practical alternative to liquidation or discontinuation of operations.

The governance unit (Audit Committee) of the Group has the responsibility for overseeing the financial reporting process.

Auditors’ Responsibilities for the Audit of the Financial Statements

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

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

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure, and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
6.We have obtained sufficient and appropriate auditing evidence of the financial information of the constited entities of the Company to express our opinions on the individual financial statements. We are responsible for the guidance, supervision and execution of the Company's audits and we are responsible for providing auditing opionions with the Company.

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

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the 2020 financial statements and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partners on the audit resulting in this independent auditors’ report are ChaoChin Yang and Chi-Jen Lee.

Financial Supervisory Commission Authorized No. Jin-Kuan-Chen-Sheni-Tzu No. 1060023872

Securities and Futures Commission Autnorized No. Tai-Tsai-Cheng-6-Tzu No. 0920123784

Date: 19 March 2021

Notice to Readers

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

For the convenience of readers, the independent auditors’ report and the accompanying financial statements have been translated into English from the original Chinese version prepared and used in the ROC. If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, the Chinese-language independent auditors’ report and financial statements shall prevail.

De Licacy Industrial Co., Ltd.

Individual Income Statement

For the Years Ended December 31 of 2020 and 2019

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(In Thousands of New Taiwan Dollars)
December 31 2020 December 31 2019
code Assets Amount ％ Amount ％
Current Assets
1100 Cash and Cash Equivalents(Notes 4 and 6) $ 341,357 3 $ 470,586 4
1110 Financial assets at fair value through profit and loss- current (Notes 4 and 7) 9,387 - 11,789 -
1136 Financial assets at amortized cost-current (Notes 4, 9 and 34) 2,689,686 20 2,107,673 16
1150 Notes receivable(Notes10 and 25) 26,432 - 41,203 -
1160 Notes receivable－ related parties(Notes 25 and 33) 25,152 - 23,568 -
1170 Net accounts receivable(Notes 4,10, and 25) 347,100 3 558,588 4
1180 Accounts receivable－related parties(Notes25 and 33) 116,894 1 98,226 1
1200 Other receivables 16,850 - 19,803 -
1210 Other receivables – related parties(Note 33) 556,912 4 214,220 2
130X Inventory(Notes 4,5, and 11) 1,371,756 10 1,294,317 10
1410 Prepayments(Notes 16 and 33) 24,549 - 30,928 -
1470 Other current assets(Notes17 and 27) 38,916 - 53,159 1
11XX Total current assets 5,564,991 41 4,924,060 38
Non-current assets
1517 Financial assets measured at fair value through other comprehensive gains and losses-
- -
non-current (Notes 4 and 8) 56,222 51,294
1550 Investments using the equity method (Notes 4 and 12) 6,847,702 50 6,917,644 53
1600 Property, plant and equipment(Notes4, 13, 33, and 34) 904,882 7 909,783 7
1755 Right-of-use assets(Notes4 and 14) 23,195 - 20,667 -
1780 Intangible assets(Notes4 and 15) - - 93 -
1840 Deferred income tax assets(Notes4 and 27) 247,413 2 139,601 1
1920 Deposited margin(Note4) 10,488 - 13,142 -
1915 Prepayment for equipment 20,325 - 70,736 1
1975 Net confirmed welfare assets(Notes 4 and 23) 14,522 - - -
15XX Total non-current assets 8,124,749 59 8,122,960 62
1XXX Total assets $ 13,689,740 100 $ 13,047,020 100
Code Liabilitities and Equity
Current liabilities
2100 Short-term loans (note 18 and 34) $ 4,611,976 34 $ 2,745,105 21
2110 Short-term notes payable (Note 18) 709,501 5 429,790 3
2120 Financial liabilities measured at fair value through profit and loss-current (notes 4 and 7) 18,919 - 2,462 -
2150 Notes payable (Note 19) 61,205 1 77,029 1
2160 Notes payable-related parties (Note 33) 32,206 - 26,092 -
2170 Accounts payable (Note 19) 94,909 1 112,254 1
2180 Notes payable-related parties (Note 33) 83,871 1 103,262 1
2200 Other payables (Note 20) 152,393 1 197,381 2
2220 Other payables-related parties (Note 33) 16,521 - 26,013 -
2230 Current income tax liabilities (Notes 4 and 27) 2,557 - - -
2280 Lease liabilities-current (Notes 4 and 14) 14,035 - 10,183 -
2313 Deferred income-current(Notes 4 and 21) 7,472 - - -
2322 Long-term loans due within one year(Notes 18 and 34) 273,158 2 1,168,000 9
2365 Refund liabilities-current(Notes 4 and 22) - - 2,789 -
2399 Other current liabilities 51,229 - 36,863 -
21XX Total current liabilities 6,129,952 45 4,937,223 38
Non-current liabilities
2541 Long-term bank loans(Notes18 and 34) 2,805,521 21 2,563,886 20
2570 Deferred income tax liabilities(Notes4 and 27) 36,823 - 35,949 -
2580 Lease liabilities-non-current(Notes4 and 14) 9,378 - 10,604 -
2630 Deferred income tax -non-crrent(Notes4 and 21) 1,422 - - -
2640 Net confirmed benefit liabilities-non-current(Notes 4 and 23) - - 22,233 -
2645 Deposit margin 2,327 - 4,011 -
25XX Total non-current liabilities 2,855,471 21 2,636,683 20
2XXX Total liabilities 8,985,423 66 7,573,906 58
Equity (Note 24)
3110 Common Sstocks 3,845,657 28 3,845,657 30
3200 Capital reserve 791,558 6 942,169 7
Retained surplus
3310 Legal surplus reserve 283,732 2 228,353 2
3320 Preferred surplus reserve 401,956 3 293,042 2
3350 Undistributed surplus ( 162,083 ) ( 1 ) 578,530 4
3300 Total retained earnings 523,605 4 1,099,925 8
3400 Other equities ( 456,503 ) ( 4 ) ( 401,956 ) ( 3 )
3500 Treasury stocks (Note 4) - - ( 12,681 ) -
3XXX Total equity 4,704,317 34 5,473,114 42
Total Liabilities and Equities $ 13,689,740 100 $ 13,047,020 100
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The accompanying notes are an integral part of the individual financial statements.

De Licacy Industrial Co., Ltd.

Individual Income Statements

For the Years Ended December 31 of 2020 and 2019

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

Code Operating income (Note 4, 25, and 33) 4100 Net sales revenue 4800 Other operating income 4000 Total operating income Operating costs(Notes11, 23, 26, and 33) 5110 Cost of goods sold 5900 Gross Operating Income 5910 Unrealized loss of subsidiary and associated companies (Note 4) 5920 Realized loss of subsidiary and associated companies (Note 4) 5950 Gross realized operating income Operating expenses(Notes10, 23, 26, and 33) 6100 Marketing expenses 6200 Management fees 6300 Research and development expenses 6450 Expected credit impairment loss (Reversal of benefits) 6000 Total operating expenses 6500 Net other income and expenses(Notes 26 and 33) 6900 Operating income(net loss) Non-operating income and expenses (Notes 4,7,26 and 33) 7100 Interest income 7010 Other income 7020 Other benefits and losses 7050 Financial costs 7070 Share of losses of affiliated companies using the equity method 7000 Total non-operating income and expenses 7900 Net profit before tax (net loss)		2020		％ 100 - 100 93 7 - - 7 6 4 4 1 15 - 8) 1 4 7 ) 3 ) 3 2) 10 )		2019
		Amount $ 3,002,049 3,591 3,005,640 2,807,286 198,354 6,405 3,815) 200,944 181,924 99,275 123,078 33,378 437,655 6 236,705) 40,280 121,553 215,109 ) 102,090 ) 93,887 61,479) 298,184 )				Amount $ 4,265,141 4,235 4,269,376 3,681,229 588,147 3,815 6,909) 585,053 225,631 144,454 108,789 676) 478,198 31,392 138,247 41,760 46,925 81,265 ) 93,329 ) 540,550 454,641 592,888		％
	( ( ( ( ( (		( ( ( ( (		( ( ( (		( (	100 - 100 87 13 - - 13 5 3 3 - 11 1 3 1 1 2 ) 2 ) 13 11 14

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2020 2019
Code Amount % Amount ％
7950 Income tax expense (benefit) (Notes 4 and
27) ( 90,898) 3 ( 34,867 ) ( 1 )
8200 Net profit (net loss) for the year ( 207,286 ) ( 7 ) 558,021 13
Other comprehensive loss(net)
8310 Items not reclassified to profit or loss
8311 Determine the remeasurement of the benefit
plan (note 23) 28,389 1 ( 6,144 ) -
8316 Unrealized appraisal gains and losses of
equity instrument investments measured at
fair value through other comprehensive gains
and losses (note 24) 8,894 - 30,547 1
8331 The equity method is used to recognize the
re-measurement of defined welfare plans of
subsidiaries and affiliated companies. 621 - 685 -
8336 The equity method is used to recognize the
unrealized gains and losses of subsidiaries
and related companies through other
comprehensive gains and losses to measure
equity instruments at fair value. (Note 24)
- -
8,109 17,628
8349 Income tax related to items not reclassified
- -
(Note 27) ( 5,678 ) 1,229
40,335 1 43,945 1
Items that may be reclassified to profit and
loss in the future
8361 Conversion difference in the conversion of
financial statements of foreign operating
institutions (Note 24) ( 88,840 ) ( 3 ) ( 192,082 ) ( 5 )
8380 Share of other comprehensive profits and
losses of subsidiaries and affiliates
- -
recognized using the equity method(Note 24) ( 3,362 ) ( 3,423 )
8399 Income tax related to items that may be
reclassified (Notes 24 and 27) 17,768 1 38,416 1
8360 ( 74,434 ) ( 2 ) ( 157,089 ) ( 4 )
8300 Total net comprehensive profit and loss for
the year (after tax) ( 34,099 ) ( 1 ) ( 113,144 ) ( 3 )
8500 Total comprehensive profit and loss for the
year ( $ 241,385 ) ( 8 ) $ 444,877 10
Earnings per share (net loss) (Note 28)
9710 Basic ( $ 0.54 ) $ 1.61
9810 Dilution ( $ 0.54 ) $ 1.60
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The accompanying notes are an integral part of the individual financial statements.

De Licacy Industrial Co., Ltd

Individual Statements of Changes in Equity

For the Years Ended December 31, 2020 and 2019

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

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Retained Earnings Other Equities
Unrealized gains or losses
Exchange differences from on financial assets at fair
the financial statements of value through other
Code Common Stock Capital Surplus Special surplus reserve Unappropriated Earnings foreign operating entitities comprehensive income Total Treasury Stocks Grand Total
A1 Balance at 1 January 2019 $ 3,345,657 $ 652,962 $ 208,137 $ 280,634 $ 241,374 ( $ 294,358 ) $ 1,316 ( $ 293,042 ) ( $ 12,681 ) $ 4,423,041
Appropriations of 2018 earninngs(Note 24)
B1 Leagal Reserve - - 20,216 - ( 20,216 ) - - - - -
B3 Preferred surplus reserve - - - 12,408 ( 12,408 ) - - - - -
B5 Cash dividends to shareholders – NT$ 0.55per share - - - - ( 184,011 ) - - - - ( 184,011 )
C15 Capital Surplus cash dividends to shareholders – NT$0.95
per share ( Note 24) . - ( 317,837 ) - - - - - - - ( 317,837 )
D1 Net income for the year ended December 31 2019 - - - - 558,021 - - - - 558,021
D3 Other comprehensive (loss) income after tax for the year
ended December 31, 2019 - - - - ( 4,230 ) ( 157,089 ) 48,175 ( 108,914 ) - ( 113,144 )
D5 Total comprehensive (loss) income fpr the year ended Dec.
31 2019 - - - - 553,791 ( 157,089 ) 48,175 ( 108,914 ) - 444,877
E1 Seasoned equity offering(Note 24) 500,000 597,987 - - - - - - - 1,097,987
M1 Dividends distributed to the subsidiary and adjust capital
surplus (Note 24) - 1,827 - - - - - - - 1,827
M5 Difference between actual acquisition of the subsidiary’s
equity price and book value difference - 8,710 - - - - - - - 8,710
M7 Changes equity to the Subsidiary ownership - ( 1,480 ) - - - - - - - ( 1,480 )
Z1 Balance at 31 December 2019 3,845,657 942,169 228,353 293,042 578,530 ( 451,447 ) 49,491 ( 401,956 ) ( 12,681 ) 5,473,114
Appropriations of 2019 earnings (Note 24)
B1 Legal Reserve - - 55,379 - ( 55,379 ) - - - - -
B3 Preferred Reserve - - - 108,914 ( 108,914 ) - - - - -
B5 Cash dividends to shareholders - NT$1.05 per share - - - - ( 403,794 ) - - - - ( 403,794 )
C15 Cash Dividends from Capital Sueplus to shareholders-
NT$0.45 per share(Note 24) - ( 173,055 ) - - - - - - - ( 173,055 )
D1 Net loss for the year ended December 31, 2020 - - - - ( 207,286 ) - - - - ( 207,286 )
D3 Other comprehensive (loss) income after tax for the year
ended December 31, 2020 - - - - 23,332 ( 74,434 ) 17,003 ( 57,431 ) - ( 34,099 )
D5 Total comprehensive (loss) income for the year ended
December 31, 2020 - - - - ( 183,954 ) ( 74,434 ) 17,003 ( 57,431 ) - ( 241,385 )
M3 The subsidiary on liquidation (Notes 24) - 7,459 - - - 12,788 - 12,788 12,681 32,928
M5 Difference between actual acquisition of the subsidiary’s
equity price and book value difference (Note 12) - 675 - - - - - - - 675
M7 Changes equity to the Subsidiary ownership (Note 24) - 14,310 - - - 422 1,102 1,524 - 15,834
Q1 Disposal of equity instruments measured at fair value through
other comprehensive income (Note 24) - - - - 11,428 - ( 11,428 ) ( 11,428 ) - -
Z1 Balance on 31 December 2020 $ 3,845,657 $ 791,558 $ 283,732 $ 401,956 ( $ 162,083 ) ( $ 512,671 ) $ 56,168 ( $ 456,503 ) $ - $ 4,704,317
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The accompanying notes are an integral part of the individual financial statements.

De Licacy Industrial Co., Ltd. Individual Cash Flows Statement

1 January to 31 December 2020 and 2019

		(in	thousands of New Taiwan Dollars)	thousands of New Taiwan Dollars)	thousands of New Taiwan Dollars)
Code			2020		2019
	Cash flow from operating activities
A10000	Income (loss) before tax this year	( $	298,184 )	$	592,888
	Adjustments for:
A20010	Income and expense:
A20100	Depreciation expenses		135,352		118,256
A20200	Amortization expenses		93		148
A20300	Expected credit impairment loss
	(Reversal of benefits)		33,378	(	676 )
A20400	Losses from financial assets and liabilities
	at fair value through profit or loss		17,623		3,734
A20900	Financial cost		102,090		93,329
A21200	Interest income	(	40,280 )	(	41,760 )
A21300	Dividend income		-	(	80 )
A21900	Share-based payment cost		-		737
A22300	Share of profits and losses of subsidiaries
	and affiliates using the equity method	(	93,887 )	(	540,550 )
A22500	Gains on disposal of Property, plant and
	equipment	(	6 )	(	31,392 )
A23700	Inventory Valuation and Obsolescence
	Losses		23,625		-
A23900	Unrealized subsidiaries and associated
	companies losses	(	6,405 )	(	3,815 )
A24000	Realized subsidiaries and associated
	companies losses		3,815		6,909
A24100	Unrealized foreign exchange losses		109,982		34,662
A29900	Benefits from liquidation of subsidiary
	using the equity method	(	9,154 )		-
A24500	Gains from lease amendment	(	10 )		-
A29900	Provision for (reversal) liabilities	(	2,789 )		781
A30000	Changes in operating assets and liabilities
A31130	Notes receivable		14,771		5,440
A31140	Notes receivable-related parties	(	1,584 )	(	13,403 )
A31150	Accounts receivable		178,110	(	102,074 )
A31160	Accounts receivable-related parties	(	18,668 )	(	47,554 )
A31180	Other receivables	(	1,998 )	(	5,352 )
A31190	Other receivables-related parties	(	2,300 )		86,337
A31200	Inventory	(	101,064 )	(	189,283 )
A31230	Prepayments		6,379		1,610
A31240	Other current assets		14,243	(	30,804 )
A32110	Decrease in financial liabilities held for
	trading	(	2,462 )	(	58 )
A32130	Notes payable	(	16,629 )	(	50,270 )
A32140	Notes payable-related parties		6,114	(	19,036 )
A32150	Accounts payable	(	17,345 )		27,691
A32160	Accounts payable-related parties	(	19,391 )	(	20,686 )
A32180	Other payables	(	45,283 )		29,189
A32190	Other payables-related parties	(	9,492 )	(	51,120 )
A32210	Deferred income-current and non-current		8,894		-
A32230	Other current liabilities		14,366		12,090
A32240	Net defined benefit liabilities-non-current	(	8,366)	(	8,911)
A33000	Cash used in operations	(	26,462)	(	143,023)
A33100	Interest received		32,404		41,760
A33200	Dividends received		39,147		56,635
A33300	Interest paid	(	101,686 )	(	90,203 )
A33500	Income tax paid	(	4,380)	(	58,267)
AAAA	Net cash used in operating activities	(	60,977)	(	193,098)

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code 2020 2019
Cash flow from investing activities
B00040 Acquisition of Amortized cost financial assets ( 10,158,528 ) ( 17,428,866 )
B00060 Gains (losses) from sale of amortized
cost financial assets Repayment at maturity 9,478,204 17,061,233
B00100 Acquisition for Fair value through other
comprehensive income financial assets ( 20,969 ) ( 19,539 )
B00200 Disposal for fair value through other
comprehensive income financial assets 23,942 10,038
B00010 Acquisition for Fair value through other
-
comprehensive income financial assets ( 7,959 )
B00020 Sales for Fair value through other comprehensive
income financial assets 11,925 -
B01800 Acquisition of Investments accounted for using
Equity Method ( 363,825 ) ( 598,530 )
B02300 Net Cash generated from disposal of subsidiaries 466,216 -
B02400 Return of shares in liquidation of investee
company in the method of equity - 88
B02700 Acquisition of property, plant and equipment ( 46,934 ) ( 123,727 )
B02800 Proceeds from disposal of property, plant and
equipment 9,414 26,370
B03700 Refundable Deposits increase ( 160 ) ( 4,597 )
B03800 Refundable Deposits decrease 2,814 2,160
B04300 Other receivables – related parties increase ( 566,293 ) ( 76,064 )
B04400 Other receivables – related parties decrease 76,064 77,067
B04500 Acquisition of intangible assets - ( 112 )
B05500 Disposal of investing real-estate 146,827 -
B07100 Prepayment for equipment increase ( 20,325 ) ( 70,736 )
BBBB Net cash used in investing activities ( 969,587 ) ( 1,145,215 )
CASH FLOWS FROM FINANCING ACTIVITIES
C00100 Short-term debt increase 20,296,772 14,977,805
C00200 Short-term debt decrease ( 18,429,901 ) ( 14,763,431 )
C00500 Short-term bills payable increase 3,898,627 3,578,715
C00600 Short-term bills payable decrease ( 3,618,916 ) ( 3,628,748 )
C01600 Payments of finance lease liabilities 1,334,900 2,983,850
C01700 Repayment of long-term debt ( 1,988,000 ) ( 2,005,325 )
C03000 Deposit received increase 5,649 9,345
C03100 Deposit received decrease ( 7,333 ) ( 7,360 )
C03700 Other payables- related parties increase - 35,000
C03800 Other payables – related parties decrease - ( 158,653 )
C04020 Repayment of the principal portion of lease
liabilities ( 13,614 ) ( 9,513 )
C04500 Ccash dividends ( 576,849 ) ( 501,848 )
C04600 seasoned equity offering - 1,097,250
CCCC Net cash generated from financing activities 901,335 1,607,087
EEEE NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS ( 129,229 ) 268,774
E00100 CASH AND CASH EQUIVALENTS AT THE
BEGINNING OF THE YEAR 470,586 201,812
E00200 CASH AND CASH EQUIVALENTS AT THE END
OF THE YEAR $ 341,357 $ 470,586
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The accompanying notes are an integral part of the individual financial statements.

Dear the Board of Directors and Shareholders of De Licacy Industrial Co., Ltd.

Opinion

We have audited the accompanying financial statements of De Licacy Industrial Co., Ltd (the “De Licacy Group”), which comprise the consolidated balance sheets as of December 31, 2020 and 2019, and the consolidated statements of comprehensive income, consolidated changes in equity and consolidated cash flows for the years then ended, and the notes to the financial statements, including a summary of significant accounting policies.

In our opinion, which is based on our and other accountants’ auditing results (please refer other matters section) and accompanying consolidated financial statements present fairly, in all material respects, the financial position of the De Licacy Group as of December 31, 2020 and 2019, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards (“IFRS”), International Accounting Standards (“IAS”), Interpretations of IFRS (“IFRIC”), and Interpretations of IAS (“SIC”) endorsed by the Financial Supervisory Commission (“FSC”) of Taiwan, the Republic of China (“ROC”).

Basis of Opinion

Key Audit Matter

The descriptions of the key audit matter of the 2020 consolidated financial statements of the De Licacy Group are as follows:

As stated in Note 4.7 Inventories, Note 5 Impairment loss of Inventories, and Note 11 Inventories of the Consolidated Financial Statements, the amount of inventories as of December 31, 2020 amounted to NT$3,210,797,000 (hereinafter referred to as "Inventories"), accounting for 18% of the total consolidated assets.

Because the carrying amount of inventories is material to the consolidated financial statements, and the evaluation of doubtful and obsolete inventories involves significant management judgment, the evaluation of inventory doubtfulness is considered a critical review.

Due to the book value of inventory is significant to the overall consolidated financial reports, and the evaluation of dull and obsolete inventory involves significant judgment of the management, the evaluation of dull inventory is listed as a key audit item.

We have reviewed the reasonableness of the assessment of inventory obsolescence as follows.

(1) To understand and evaluate the effectiveness of the design and implementation of the inventory internal control system.
(2) To evaluate the aging of inventories at the end of the year and verify the correctness of the

ageing of inventories on a sample basis, and then recalculate the appropriateness of the provision for inventory doubtfulness loss.

(3.) Conduct inventory stocktaking at the end of the year to confirm and evaluate whether the inventory is obsolete or damaged.

Other Matters

The consolodated financial statements included in the consolidated financial statements of Deloitte Touche Tohmatsu, Inc. and its investment in ERA NOUVEAU INTERNATIONAL CO., LTD. Accordingly, our opinion on the consolidated financial statements referred to above, which relates to the amount of the aforementioned investment and its comprehensive income and loss, was based on the audited reports of other auditors. The above investments accounted for by the equity method amounted to $46,459,000 and $96,773,000 as of December 31, 2020 and 2019, respectively, representing less than 1% and 1% of the total consolidated assets The consolidated loss recognized under the equity method amounted to $50,314,000 and $28,489,000 for the years ended December 31, 2020 and 2019, respectively, which accounted for (22%) and (6%) of the consolidated total profit or loss.

De Licacy Industrial Co., Ltd. has prepared its individual financial statements for the years ended December 31, 2020 and 2019, and we have issued an unqualified audit report, with additional qualifications for refernce.

Management's and Governance's Responsibility for the Consolidated Financial Statements

Management's responsibility is to prepare consolidated financial statements in conformity with the Guidelines Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards, International Accounting Standards, and Interpretations and Interpretations issued by the Financial Supervisory Commission, and to maintain such internal control relevant to the preparation of consolidated financial statements as is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management's responsibility also includes assessing the ability of the Group to continue as a going concern, the disclosure of related matters, and the adoption of the going concern basis of accounting, unless management intends to liquidate the Group or cease operations, or there is no practical alternative to liquidation or discontinuation of operations.

The governance unit (Audit Committee) of the Group has the responsibility for overseeing the financial reporting process.

Auditors’ Responsibilities for the Audit of the Financial Statements

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

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks,

and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Corporation’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Corporation’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Corporation to cease to continue as a going concern.
Evaluate the overall presentation, structure, and content of the consolidated financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We have obtained sufficient and appropriate auditing evidence of the financial information of the constituent entities of the Group to express our opinions on the consolidated financial statements. We are responsible for the guidance, supervision and execution of the Group's audits and we are responsible for providing auditing opinions with the Group.

The engagement partners on the audit resulting in this independent auditors’ report are Chao-Chin Yang and Chi-Jen Lee.

Financial Supervisory Commission Authorized No. Jin-Kuan-Chen-Sheni-Tzu No. 1060023872

Securities and Futures Commission Autnorized No. Tai-Tsai-Cheng-6-Tzu No. 0920123784

Date: 19 March 2021

Notice to Readers

De Licacy Industrial Co., Ltd.and Subsidiaries Consolidated Balance Sheets The Years Ended December 31, 2020 and 2019

(In thousands of New Taiwan Dollars)

Code 1100 1110 1120 1136 1150 1160 1170 1180 1200 1210 130X 1410 1479 11XX 1517 1535 1550 1600 1755 1760 1805 1821 1840 1920 1975 1990 15XX 1XXX CODE 2100 2110 2120 2150 2160 2170 2180 2219 2220 2230 2280 2322 2365 2399 21XX 2541 2580 2570 2630 2640 2645 25XX 2XXX 3100 3110 3200 3310 3320 3350 3300 3400 3500 31XX 36XX 3XXX	Assets Current assets Cash and cash equivalents (Notes 4 and 6) Financial assets at fair value through profit and loss- (Notes 4 and 7) Financial assets at fair value through other comprehensive gains and losses-current (notes 4 and 8) Financial assets at amortized cost-current (Notes 4, 9 and 38) Notes receivable (Notes 4, 10 and 28) Notes receivable-related parties (Notes 4, 10, 28 and 37) Net accounts receivable (Notes 4, 10 and 28) Accounts receivable-net amount of related parties (Notes 4, 28 and 37) Other receivables (Note 10) Other receivables-related parties (Note 37) Inventory (Notes 4, 5 and 11) Prepayments (Note 19) Other current assets (Notes 20 and 30) Total current assets Non-current assets Financial assets measured at fair value through other comprehensive gains and losses-non-current (Notes 4 and 8) Financial assets measured at amortized cost-non-current (Notes 4 and 9) Investments using the equity method (Notes 4 and 13) Real estate, plant and equipment (Notes 4, 14, 37 and 38) Right-of-use assets (Notes 4, 15 and 38) Investment real estate (Notes 4, 16 and 38) Goodwill (Notes 4 and 17) Other intangible assets (Notes 4 and 18) Deferred income tax assets (Notes 4 and 30) Deposited margin (Note 4) Net confirmed welfare assets-non-current (Notes 4 and 26) Other non-current assets (note 20) Total non-current assets Total assets Liabilities and Equity Current liabilities Short-term loans (note 21 and 38) Short-term notes payable (Note 21) Financial liabilities measured at fair value through profit and loss-current (notes 4 and 7) Notes payable (Note 22) Notes payable-related parties (Note 37) Accounts payable (Note 22) Accounts payable-related parties (Note 37) Other payables (note 23) Other payables-related parties (Note 37) Current income tax liabilities (Notes 4 and 30) Lease liabilities-current (Notes 4 and 15) Long-term loans due within one year (Notes 21 and 38) Refund liabilities-current (notes 4 and 25) Other current liabilities (Note 28) Total current liabilities Non-current liabilities Long-term bank loans (Notes 21 and 38) Lease liabilities-non-current (Notes 4 and 15) Deferred income tax liabilities (Notes 4 and 30) Non-current deferred income (Notes 4 and 24) Net confirmed benefit liabilities-non-current (Notes 4 and 26) Deposit margin Total non-current liabilities Total liabilities Equity attribuSchedule to the owners of the company (Note 27) Stocks Common stocks Capital reserve Retained surplus Legal surplus reserve Preferred surplus reserve Undistributed surplus Total retained earnings Other equities Treasury stocks (note 4) Total equity of company owners Non-controlling interests (note 27) Total equity Total		December 31 2020		％ 7 - - 16 - - 9 1 1 1 18 1 3 57 1 - 5 33 2 - - - 2 - - - 43 100 36 4 - - - 4 - 3 1 - - 2 - 1 51 18 - - - - - 18 69 22 4 2 2 1 ) 3 2 ) - 27 4 31 100		December 31 2019
			Amount $ 1,223,480 64,704 38,979 2,816,902 79,586 24,845 1,614,862 147,303 116,078 114,870 3,210,797 156,743 561,533 10,170,682 120,056 27,725 793,054 5,922,156 370,567 65,071 12,996 15,423 283,407 17,082 5,476 43,735 7,676,748 $ 17,847,430 $ 6,400,957 709,501 20,927 72,165 32,206 650,938 98,596 498,196 183,505 5,814 27,739 282,952 3,705 121,343 9,108,544 3,181,005 14,435 36,823 49,376 - 2,464 3,284,103 12,392,647 3,845,657 791,558 283,732 401,956 162,083 ) 523,605 456,503 ) - 4,704,317 750,466 5,454,783 $ 17,847,430				Amount $ 1,343,347 61,908 - 2,449,905 177,969 - 1,801,429 159,252 204,263 257,459 3,350,147 200,598 728,140 10,734,417 111,010 25,229 727,795 6,279,836 451,968 64,716 12,444 17,294 175,568 21,643 - 161,728 8,049,231 $ 18,783,648 $ 5,270,282 429,790 2,462 145,447 - 651,628 139,678 669,316 248,464 14,758 46,679 1,174,746 6,523 136,918 8,936,691 3,372,293 58,701 53,135 34,853 55,544 4,250 3,578,776 12,515,467 3,845,657 942,169 228,353 293,042 578,530 1,099,925 401,956 ) 12,681 ) 5,473,114 795,067 6,268,181 $ 18,783,648		％
		( (		( (		( (		(	7 - - 13 1 - 10 1 1 1 18 1 4 57 1 - 4 34 2 - - - 1 - - 1 43 100 28 2 - 1 - 4 1 4 1 - - 6 - 1 48 18 1 - - - - 19 67 20 5 1 2 3 6 2 ) - 29 4 33 100

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

De Licacy Industrial Co., Ltd.and Subsidiaries Consolidated Income Statements For the Years Ended December 31 of 2020 and 2019

(In thousands of New Taiwan Dollars) (Except Earnings (net loss) Per Share)

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2020 2019
Code Amount ％ Amount ％
Operating income (Note 4, 28 and 37)
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4100 Net sales revenue 4800 Other operating income 4000 Total operating income Operating costs (Notes 11, 26, 29 and 37) 5110 Cost of goods sold 5900 Gross Operating Income 5910 Unrealized sales benefits (Note 4) ( 5950 Gross realized operating income Operating expenses (Note 10, 26 and 29) 6100 Marketing expenses 6200 Management fees 6300 Research and development expenses 6450 Expected credit impairment loss 6000 Total operating expenses 6500 Net other income and expenses (notes 29 and 37) ( 6900 Operating income Non-operating income and expenses (Notes 4, 7, 16, 29 and 37) 7100 Interest income 7190 Other income 7020 Other benefits and losses ( 7050 Financial costs ( 7060 Share of losses of affiliated companies using the equity method ( 7000 Total non-operating income and expenses ( 7900 Net profit before tax (net loss) ( 7950 Income tax expense (benefits) (Notes 4 and 30) ( 8200 Net profit (net loss) for the year (	$ 8,407,460 187,199 8,594,659 7,350,952 1,243,707 26) 1,243,681 471,947 490,694 208,459 60,043 1,231,143 9,383) 3,155 42,886 204,648 281,461 ) ( 177,717 ) ( 83,313) ( 294,957) ( 291,802 ) ( 85,169) ( 206,633) (	98 2 100 86 14 - 14 5 6 2 1 14 - - - 2 3 ) ( 2 ) ( 1) ( 4) ( 4 ) 1) 3)	$ 10,533,526 386,198 10,919,724 8,865,307 2,054,417 - 2,054,417 576,654 475,357 231,949 24,314 1,308,274 55,618 801,761 54,256 123,148 52,828 ) 206,066 ) ( 53,384) 134,874) ( 666,887 52,424 614,463	96 4 100 81 19 - 19 5 5 2 - 12 - 7 - 1 - 2 ) - 1) 6 - 6

(Continued)

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2020 2019
Code Amount ％ Amount ％
Other comprehensive income (net loss)
8310 Items not reclassified to profit or loss
8311 Determine the remeasurement of the benefit
- -
plan (note 26) 29,226 ( 4,956 )
8316 Unrealized appraisal gains and losses of
equity instrument investments measured at
fair value through other comprehensive
gains and losses (note 27) 29,573 1 65,232 1
8320 Share of other comprehensive profit and loss
of affiliates using the equity method (Note
- - -
27) ( 1,548 )
8349 Income tax related to items not reclassified
- -
(Note 30) ( 5,678 ) 1,038
51,573 1 61,314 1
Items that may be reclassified to profit and
loss in the future
8361 Conversion difference in the conversion of
financial statements of foreign operating
institutions (Note 27) ( 114,464 ) ( 1 ) ( 188,358 ) ( 2 )
8370 Share of other comprehensive profit and loss
of affiliates using the equity method (Note
- -
27) 26,815 ( 26,500 )
8399 Income tax related to items that may be
- -
reclassified (Notes 27 and 30) 18,305 39,648
8360 ( 69,344 ) ( 1 ) ( 175,210 ) ( 2 )
8300 Other comprehensive profit and loss for the
year (net after tax) ( 17,771 ) - ( 113,896 ) ( 1 )
8500 Total comprehensive profit and loss for the
year ( $ 224,404 ) ( 3 ) $ 500,567 5
8600 The net profit (net loss) is attribuSchedule
to:
8610 Owner of the company ( $ 207,286 ) ( 3 ) $ 558,021 5
8620 Non-controlling interests 653 - 56,442 1
( $ 206,633 ) ( 3 ) $ 614,463 6
8700 The total comprehensive profit and loss is
attribuSchedule to:
8710 Owner of the company ( $ 241,385 ) ( 3 ) $ 444,877 4
8720 Non-controlling interests 16,981 - 55,690 1
( $ 224,404 ) ( 3 ) $ 500,567 5
Earnings per share (net loss) (Note 31)
9710 Basic ( $ 0.54 ) $ 1.61
9810 Dilution ( $ 0.54 ) $ 1.60
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The accompanying notes are an integral part of the consolidated financial statements.

De Licacy Industrial Co., Ltd.and Subsidiaries Consolidated Statements of Changes in Equity For the Years Ended December 31, 2020 and 2019

(In thousands of New Taiwan Dollars, Except Dividends per Share)

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Equity attribute to the Company’s owner
Retained Earnings Other Equities
Unrealized gains or
Exchange differences losses on financial
from the financial assets at fair value
Unappropriated statements of foreign through other
Code Common Stock Capital Surplus Special surplus reserve Earnings operating enteritis comprehensive income Total Treasury Stocks Grand Total Non-Controlled Equity Total Equity
A1 Balance at 1 January 2019 $ 3,345,657 $ 652,962 $ 208,137 $ 280,634 $ 241,374 ( $ 294,358 ) $ 1,316 ( $ 293,042 ) ( $ 12,681 ) $ 4,423,041 $ 798,168 $ 5,221,209
Appropriations of 2018 earnings (Note27)
B1 Legal Reserve - - 20,216 - ( 20,216 ) - - - - - - -
B3 Preferred surplus reserve - - - 12,408 ( 12,408 ) - - - - - - -
B5 Cash dividends to shareholders – NT$ 0.55per share - - - - ( 184,011 ) - - - - ( 184,011 ) - ( 184,011 )
C15 Capital Surplus cash dividends to shareholders – NT$0.95
per share ( Note 27) . - ( 317,837 ) - - - - - - - ( 317,837 ) - ( 317,837 )
D1 Net income for the year ended December 31 2019 - - - - 558,021 - - - - 558,021 56,442 614,463
D3 Other comprehensive (loss) income after tax for the year
ended December 31, 2019 - - - - ( 4,230 ) ( 157,089 ) 48,175 ( 108,914 ) - ( 113,144 ) ( 752 ) ( 113,896 )
D5 Total comprehensive (loss) income for the year ended Dec.
31 2019 - - - - 553,791 ( 157,089 ) 48,175 ( 108,914 ) - 444,877 55,690 500,567
E1 Seasoned equity offering(Note 27) 500,000 597,987 - - - - - - - 1,097,987 - 1,097,987
M1 Dividends distributed to the subsidiary and adjust capital
surplus (Note 27) - 1,827 - - - - - - - 1,827 - 1,827
M3 Subsidiary liquidation and returned shares (Note 27) - - - - - - - - - - ( 5,186 ) ( 5,186 )
M5 Difference between actual acquisition of the subsidiary
equity price and book value difference (Notes 12, 27, and
33) - 8,710 - - - - - - - 8,710 ( 105,324 ) ( 96,614 )
M7 Changes equity to the Subsidiary ownership (Notes 12, 27
and 33) - ( 1,480 ) - - - - - - - ( 1,480 ) 1,480 -
O1 Cash dividends from the Subsidiary (Note 27) - - - - - - - - - - ( 43,842 ) ( 43,842 )
T1 Non-controlled equity increase(Note 27) - - - - - - - - - - 94,081 94,081
Z1 Balance at 31 December 2019 3,845,657 942,169 228,353 293,042 578,530 ( 451,447 ) 49,491 ( 401,956 ) ( 12,681 ) 5,473,114 795,067 6,268,181
Appropriations of 2019 earnings (Note 27)
B1 Legal Reserve - - 55,379 - ( 55,379 ) - - - - - - -
B3 Preferred Reserve - - - 108,914 ( 108,914 ) - - - - - - -
B5 Cash dividends to shareholders - NT$1.05 per share - - - - ( 403,794 ) - - - - ( 403,794 ) - ( 403,794 )
C15 Cash Dividends from Capital Surplus to shareholders-
NT$0.45 per share(Note 27) - ( 173,055 ) - - - - - - - ( 173,055 ) - ( 173,055 )
D1 Net income for the year ended December 31, 2020 - - - - ( 207,286 ) - - - - ( 207,286 ) 653 ( 206,633 )
D3 Other comprehensive (loss) income after tax for the year
ended December 31, 2020 - - - - 23,332 ( 74,434 ) 17,003 ( 57,431 ) - ( 34,099 ) 16,328 ( 17,771 )
D5 Total comprehensive (loss) income for the year ended
December 31, 2020 - - - - ( 183,954 ) ( 74,434 ) 17,003 ( 57,431 ) - ( 241,385 ) 16,981 ( 224,404 )
M3 The subsidiary on liquidation (Notes 27 and 32) - 7,459 - - - 12,788 - 12,788 12,681 32,928 ( 189,185 ) ( 156,257 )
M5 Difference between actual acquisition of the subsidiaries
equity price and book value difference (Notes 12, 27, and
33) - 675 - - - - - - - 675 ( 22,004 ) ( 21,329 )
M7 Changes equity to the Subsidiary ownership (Notes 12, 27
and 33) - 22,394 - - - 422 1,102 1,524 - 23,918 ( 23,918 ) -
O1 Cash dividends from the Subsidiary (Note 27) - - - - - - - - - - ( 45,663 ) ( 45,663 )
Q1 Other comprehensive loss /income at fair value through
liquidation (Note 27)
- - - - 11,428 - ( 11,428 ) ( 11,428 ) - - - -
T1 Non-controlled equity increase(Note 27) - ( 8,084 ) - - - - - - - ( 8,084 ) 219,188 211,104
Z1 Balance on 31 December 2020 $ 3,845,657 $ 791,558 $ 283,732 $ 401,956 ( $ 162,083 ) ( $ 512,671 ) $ 56,168 ( $ 456,503 ) $ - $ 4,704,317 $ 750,466 $ 5,454,783
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The accompanying notes are an integral part of the consolidated financial statements

.De Licacy Industrial Co., Ltd.and Subsidiaries Consolidated Statements of Cash Flows For the years ended December 31 of 2020 and 2019

(In thousands of New Taiwan Dollars)

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Code 2020 2019
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CASH FLOWS FROM OPERATING ACTIVITIES A10000 Income (Loss) before tax ( A20000 Adjustments for: Revenues/Expenses A20100 Depreciation A20200 Amortization A20300 Impairment loss (impairment gain and reversal of impairment loss) determined in accordance with IFRS 9 A20400 Financial assets and liabilities at fair value through profit or loss A20900 Financial cost A21200 Interest income ( A21300 Dividend income ( A21900 Share-Based Payment cost A22300 Share of Loss of Associates & Joint Ventures Accounted for Using Equity Method A22500 Loss (income) from liquidation of property, plant and equipment A22700 Income from liquidation of fixed assets investment A23700 Inventory Valuation and Obsolescence Losses A23900 Unrealized sales income A24100 Unrealized foreign exchange losses A24500 Benefits from liquidation of subsidiary ( A29900 Allowance (reversal) for refund liability. ( A29900 Gains from lease amendment ( Changes in operating assets and liabilities A31130 Notes Receivable A31150 Accounts Receivable (include stakeholders) A31180 Other accounts receivable (include stakeholders) ( A31200 Inventory A31230 Prepayments A31240 Other current assets A32130 Notes payable ( A32150 Accounts payable A32160 Accounts payable - stakeholders ( A32180 Other payables ( A32190 Other payables - stakeholder A32230 Other current liabilities ( A32240 Net confirmed welfare liability (assets) – non- current ( A32990 Long-term differed income A33000 Cash generated from operations A33100 Interest received A33200 Dividends received A33300 Interest paid ( A33500 Income tax paid ( AAAA Cash generated from operations (net) CASH FLOWS FROM INVESTING ACTIVITIES B00010 Acquisition of financial assets - current at fair value through other comprehensive profit or loss ( B00020 Liquidation of financial assets - current at fair value through other comprehensive profit or loss B00100 Acquisition of financial assets at fair value through profit or loss ( B00200 Liquidation of financial assets at fair value through profit or loss B00040 Acquisition of financial assets at amortized cost (	$ 291,802 ) 615,814 2,073 60,043 9,740 ( 177,717 42,886 ) ( 1,487 ) ( - 83,313 9,383 ( - ( 42,628 26 95,539 9,154 ) 1,950 ) 10 ) 14,976 58,893 ( 56,839 ) 42,252 ( 37,655 ( 88,533 ( 1,367 ) ( 7,761 32,879 ) 122,455 ) 9,697 ( 19,993 ) 27,231 ) ( 22,829 ( 770,819 40,590 1,487 179,579 ) ( 30,296 ) ( 603,021 83,563 ) 63,635 21,277 ) ( 24,242 10,682,165 ) (	$ 666,887 542,728 2,224 24,314 33,621 ) 206,066 54,256 ) 1,602 ) 737 53,384 55,618 ) 14,409 ) 9,264 - 13,081 - 1,077 - 54,238 183,582 ) 24,955 518,876 ) 46,779 ) 158,562 ) 43,571 ) 33,756 139,678 143,169 10,332 ) 64,878 13,605 ) 2,193 ) 843,430 51,664 1,602 201,963 ) 90,745 ) 603,988 - - 24,569 ) 15,113 18,395,760 )

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code 2020 2019
B00060 Financial assets at amortized cost repayment of
principal upon maturity 9,900,763 18,038,738
B01800 Investments accounted for using equity method ( 6,375 ) ( 22,259 )
B02000 Increase in prepayments for investments ( 34,647 ) -
B02200 Net cash flows from subsidiary acquisition ( 1,225 ) -
B02300 Net cash flows from subsidiary liquidation ( 1,801 ) -
B02400 Net returned payments for share from subsidiary
-
liquidation ( 5,285 )
B02700 Acquisition of property, plant and equipment ( 438,271 ) ( 1,263,391 )
B02800 Proceeds from liquidation of property, plant and
equipment 263,177 362,256
B03700 Increase in refundable deposits ( 1,445 ) ( 16,796 )
B03800 Decrease in refundable deposits 2,928 12,381
B04300 Increase in other Accounts receivable – related parties ( 8,009 ) -
B04500 Acquisition of intangible assets ( 565 ) ( 1,430 )
B05350 Acquisition of the right-of-use assets - ( 1,629 )
B05500 Proceeds from disposal of real estate investments 43,030 -
B06700 Increase in prepayment for equipment ( 12,866 ) ( 117,386 )
B06800 Decrease in long-term receivables 1,355 1,798
B07600 Received dividends from associated companies 7,949 -
B09900 Subsidies from the right-of-use assets - 25,697
BBBB Net cash used in investing activities ( 985,130 ) ( 1,392,522 )
CASH FLOWS FROM FINANCING ACTIVITIES
C00100 Increase in short-term debts 29,164,154 27,027,237
C00200 Decrease in short-term debts ( 27,574,750 ) ( 26,836,058 )
C00500 Increase in short-term notes and bills payable 3,948,627 3,704,716
C00600 Decrease in short-term notes and bills payable ( 3,638,916 ) ( 3,767,743 )
C01600 Loan of long-term debt 5,023,231 12,974,615
C01700 Repayment of long-term debt ( 6,105,032 ) ( 11,911,926 )
C03000 Increase in deposits received 6,224 10,382
C03100 Decrease in deposits received ( 8,010 ) ( 8,273 )
C03600 Decrease in other payables - ( 44,500 )
C03700 Increase in other payables= related parties 175,660 203,842
C03800 Decrease in other payables= related parties ( 181,974 ) ( 481,156 )
C04020 Repayment of the principal portion of lease liabilities ( 47,391 ) ( 43,565 )
C04500 Net cash used in financing activities ( 622,512 ) ( 543,863 )
C04600 Issuance of common stock for cash - 1,097,250
C05400 Issuance of Subsidiary’s common stock for cash 211,104 94,081
C09900 Acquisition of ownership interests in subsidiaries ( 96,279 ) ( 21,664 )
CCCC Net cash generated from financing activities 254,136 1,453,375
DDDD EFFECTS OF EXCHANGE RATE CHANGES ON THE
BALANCE OF CASH HELD IN FOREIGN
CURRENCIES 8,106 ( 51,326 )
EEEE NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS ( 119,867 ) 613,515
E00100 CASH AND CASH EQUIVALENTS AT THE
BEGINNING OF THE YEAR 1,343,347 729,832
E00200 CASH AND CASH EQUIVALENTS AT THE END OF
THE YEAR $ 1,223,480 $ 1,343,347
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The accompanying notes are an integral part of the consolidated financial statements.

Case 2 ： Board of Directors

Cause of action：According to the company’s 2020 Deficit Compensated Case, please acknowledge it.

Explanation ： (1) The company's 2020 statement of deficit compensated has been compiled as follows.

(2) Approved by the company's board of directors on March 15, 2021.

compiled as follows. (2) Approved by the company's board of directors on March 15, 2021.	compiled as follows. (2) Approved by the company's board of directors on March 15, 2021.	compiled as follows. (2) Approved by the company's board of directors on March 15, 2021.
DE LICACY INDUSTRIAL CO., LTD. statement of deficit compensated 2020 Unit: New Taiwan Dollar
Item	Amount
Undistributed surplus at the beginning of the period (loss to be made up)	﹩10,443,112
Add: Re-measurements of the defined benefit plans are recognized in retained earnings	22,711,594
Add: other comprehensive profit and loss components of long-term equity investment	620,639
Add: Dispose of equity instruments measured at fair value through other comprehensive gains and losses, and increase retained earnings	11,427,828

Adjusted undistributed surplus	45,203,173
2020 net loss after tax	( 207,286,476)
Legal reserve to make up for the loss		162,083,303
Distributable surplus for the currentperiod		﹩0

Person in charge: Ye Jiaming Manager: Ye Weili Accounting Supervisor: You Yineng

Resolution:

Discussion matters

Case 1 ： Board of Directors

Cause of action: The proposal to amend the "Rules of Procedures for Shareholders' Meetings" of the company, please referendum.

Explanation: 1.In accordance with the articles of Taiwan Stock Exchange Co., Ltd., Taiwan Securities Governance Zi No. 1100001446 on January 28, 2021, Articles 3, 8 and 11 of the "Rules of Procedures for Shareholders' Meetings" of the company have been amended.

2.The comparison table of revised articles is as follows:

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Article to be amended Current Article Explanation
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xplanation: 1.In accordance with the articles of Taiwan Stock Exchange Co., Ltd., Taiwan Securities Governance Zi No. 1100001446 on January 28, 2021, Articles 3, 8 and 11 of the "Rules of Procedures for Shareholders' Meetings" of the company have been amended. 2.The comparison table of revised articles is as follows:	xplanation: 1.In accordance with the articles of Taiwan Stock Exchange Co., Ltd., Taiwan Securities Governance Zi No. 1100001446 on January 28, 2021, Articles 3, 8 and 11 of the "Rules of Procedures for Shareholders' Meetings" of the company have been amended. 2.The comparison table of revised articles is as follows:	xplanation: 1.In accordance with the articles of Taiwan Stock Exchange Co., Ltd., Taiwan Securities Governance Zi No. 1100001446 on January 28, 2021, Articles 3, 8 and 11 of the "Rules of Procedures for Shareholders' Meetings" of the company have been amended. 2.The comparison table of revised articles is as follows:	xplanation: 1.In accordance with the articles of Taiwan Stock Exchange Co., Ltd., Taiwan Securities Governance Zi No. 1100001446 on January 28, 2021, Articles 3, 8 and 11 of the "Rules of Procedures for Shareholders' Meetings" of the company have been amended. 2.The comparison table of revised articles is as follows:
Article to be amended Current Article Explanation

	Article 3 1.Omitted. 2.Election or dismissal of directors or supervisors, amendments to the articles of incorporation, reduction of capital, application for the approval of ceasing its status as a public company, approval of competing with the company by directors, surplus profit distributed in the form of new shares, reserve distributed in the form of new shares, the dissolution, merger, or demerger of the corporation, or any matter under Article 185, paragraph 1,Article 26-1, Article 43-6 of the Securities Exchange Law,	Article 3 1.Omitted. 2.Election or dismissal of directors or supervisors, amendments to the articles of incorporation, reduction of capital, application for the approval of ceasing its status as a public company, approval of competing with the company by directors, surplus profit distributed in the form of new shares, reserve distributed in the form of new shares, the dissolution, merger, or demerger of the corporation, or any matter under Article 185, paragraph 1 shall be set out and the essential contents explained in the notice of the reasons for convening the shareholders meeting. None of the above matters may be raised by an extraordinary motion; the essential contents may be posted on the website designated by the competent authority in charge of securities affairs or the corporation, and such website shall be indicated in the above notice;The main content may be placed on the website designated by the securities authority or the company, and the website shall be included in the notice.Where re- election of all directors and supervisors as well as their	Adjust the announcement method in line with the articles.
	Article 56-1 and Article 60-2
	of the Regulations Governing
	the Offering and Issuance of
	Securities by Securities
	Issuersshall be set out and the essential contents explained in the notice of the reasons for convening the shareholders meeting. None of the above matters may be raised by an extraordinary motion; the essential contents may be posted on the website designated by the competent authority in charge of

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securities affairs or the inauguration date is stated in the
corporation, and such website notice of the reasons for
shall be indicated in the above convening the shareholders
notice. meeting, after the completion of
the re-election in said meeting
such inauguration date may not
The following is omitted. be altered by any extraordinary
motion or otherwise in the same
meeting.
The following is omitted.
Article 8 Article 8
1.Omitted. 1.Omitted.
2.The chair shall call the 2.The chair shall call the In order to improve
meeting to order at the meeting to order at the corporate governance and
appointed meeting time. At appointed meeting time. safeguard the rights and
interests of shareholders,
the same time, relevant However, when the attending
the second paragraph is
information such as the shareholders do not represent a
amended.
number of non-voting rights majority of the total number of
and the number of shares issued shares, the chair may
present will be announced. announce a postponement,
However, when the attending provided that no more than two
shareholders do not represent such postponements, for a
a majority of the total number combined total of no more than
of issued shares, the chair one hour, may be made. If the
may announce a quorum is not met after two
postponement, provided that postponements and the attending
no more than two such shareholders still represent less
postponements, for a than one third of the total
combined total of no more number of issued shares, the
than one hour, may be made. chair shall declare the meeting
If the quorum is not met after adjourned.
two postponements and the
attending shareholders still The following is omitted
represent less than one third
of the total number of issued
shares, the chair shall declare
the meeting adjourned.
The following is omitted.
Article 11 Article 11
1.The election of directors at 1.The election of directors at a In order to improve
a shareholders meeting shall shareholders meeting shall be corporate governance and
be held in accordance with held in accordance with the safeguard the rights and
interests of shareholders,
the applicable election and applicable election and
the first paragraph is
appointment rules adopted by appointment rules adopted by
amended.
this Corporation, and the this Corporation, and the voting
voting results shall be results shall be announced on-
announced on-site site immediately, including the
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immediately, including the names of those elected as names of those elected as directors and the numbers of directors and the numbers of votes with which they were votes with which they were elected. elected. 2.Omitted.

2.Omitted.

Resolution:

Case 2:

Cause of action: The company’s Capital reserve cash distribution case, please

referendum.

Explanation:1. In accordance with Article 241 of the Company Act, it is proposed to use the "surplus from the issuance of shares in excess of the par value"-Capital reserve for the issuance of stock premium, and shareholders will receive a cash dividend of NT$0.30 per share in proportion to their holdings, and the total amount is NT$115,369,696.
The base date for the allotment of cash dividends and related matters concerning the distribution of cash dividends shall be determined by the board of directors by authorizing the board of directors to decide upon the resolution of this case by the shareholders' meeting.
The calculation method is unconditionally rounded down if the cash dividend is less than NT$1, and the remaining cash dividend amount is transferred to the employee welfare committee of the company.
The number of cash dividend distribution is calculated based on the number of outstanding shares of 384,565,652 shares. If subsequent changes in the company’s share capital affect the number of outstanding shares, resulting in changes in the shareholder’s dividend rate, it is proposed to request the shareholders' meeting to authorize the chairman of the board to deal with them in full powers.
For allotment matters, such as changes in laws or regulations, amendments ordered by the competent authority, or amendments due to the objective circumstances, it is proposed to request the shareholders' meeting to authorize the chairman of the board to deal with them in full powers in accordance with the law.

Resolution:

Extraordinary motions

Articles of DE LICACY INDUSTRIAL CO., LTD.

Chapter 1 General Provisions

Article 1: The company is organized in accordance with the provisions of the Company Law and named as DE LICACY INDUSTRIAL CO., LTD.
Article 2: The businesses operated by the company are as follows:
Printing and dyeing, finishing, processing, manufacturing and trading business of Plisse’, blended fabric, jacquard, check, stretch fabric, chemical fabric, polyester staple fiber, Silk and other textiles.
2.The business of manufacturing, trading, processing and import and export trade of the products mentioned in the preceding paragraph and related yarn materials.
C802020 Manmade Fiber Manufacturing.
F104010 Wholesale of Fabrics.
F107020 Wholesale of Dyes and Pigments.
F113100 Wholesale of Pollution Controlling Equipment.
F204010 Retail sale of Fabrics.
H701040 Specific Area Development.
H701020 Industrial Factory Development and Rental.
C306010 Wearing Apparel.
ZZ99999 All business items that are not prohibited or restricted by law, except those that are subject to special approval.
Article 3: The company has a head office in Tainan City, and if necessary, the board of directors may decide to set up domestic or abroad branches.
Article 3-1: When the company reinvests in another company and becomes a limited liability shareholder, the total amount of investment shall not exceed 40% of the paid-in share capital as stipulated in Article 13 of the Company Act, but shall be determined by the board of directors for agreement.
Article 3-2: The company may endorse and guarantee externally for business needs, and its operations shall be handled in accordance with the company's Management of Endorsement and Guarantees.
Article 4: The company's announcement method shall be handled in accordance with Article 28 of the Company Act.

Chapter 2 Shares

Article 5: The total capital of the company is set at NT$4.8 billion, divided into 480 million shares, all of which are ordinary shares, and the board of

directors is authorized to issue them in installments as needed.

Article 6: The company’s stocks are all registered, signed or stamped by three or more directors, and issued after obtaining visas in accordance with the law. When the company issues new shares, it may print or exempt shares based on the total number of shares issued.

The shares issued by the company may be exempt from printing shares and should be registered with TDCC.

Article 7: The company's stock affairs are handled in accordance with "Regulations Governing the Administration of Shareholder Services of Public Companies", relevant laws and regulations, and the regulations of the competent authority.
Article 8: The period during which the company ceases stock transfer shall be handled in accordance with the provisions of the Company Act and other relevant laws and regulations.

Chapter 3 Shareholders’ meeting

Article 9: The company’s shareholders’ meeting is divided into the following two categories:
Regular shareholders' meeting: it is convened at least once a year, convened by the board of directors, and held within six months after the end of each fiscal year.
Temporary shareholders' meeting: convened when necessary in accordance with the provisions of the Company Act.
Article 10: The procedures for convening the shareholders' meeting of the company shall be handled in accordance with the provisions of the Company Act and other relevant laws and regulations.
Article 11: When the shareholders meeting is convened by the board of directors, the chairman of the board shall be the chairman. When the chairman of the board asks for leave or is unable to exercise his authority for some reason, his agency shall be handled in accordance with Article 208, Paragraph 3 of the Company Act.

When the shareholders' meeting is convened by a convening person other than the board of directors, the convening person shall be the chairman, and if there are two or more convening persons, one of the other persons shall be elected as the chairman.

Article 12: When a shareholder is unable to attend the shareholders meeting for some reason, it shall be handled in accordance with Article 177 of the Company Law and the "Regulations Governing the Use of Proxies for Attendance at Shareholder Meetings of Public Companies" issued by

the competent authority.

Article 13: The voting rights of shareholders shall be one right per share.

Article 14: Unless otherwise provided by relevant laws and regulations, the resolutions of the shareholders meeting shall be attended by shareholders representing more than half of the total number of issued shares, and shall be implemented with the approval of more than half of the voting rights of the shareholders present. According to the regulations of the competent authority, shareholders of the company can also exercise their voting rights electronically. Shareholders who exercise their voting rights electronically are deemed to be present in person, and related matters are handled in accordance with laws and regulations.
Article 15: The meeting minutes of the shareholders' meeting shall be signed or sealed by the chairman, and the minutes shall be distributed to all shareholders within 20 days after the meeting. The minutes are kept in the company together with the signature book of the shareholders present and the proxy attendance letter.

The meeting minutes may be produced and distributed in electronic form.

The meeting minutes shall accurately record the year, month, day, and place of the meeting, the chair's full name, the methods by which resolutions were adopted, and a summary of the deliberations and their voting results. The minutes shall be retained for the duration of the existence of this Corporation.

The retention period of the signature book of attending shareholders and the power of attorney for proxy attendance shall be at least one year unless otherwise provided by the Company Act.

The distribution of the minutes of the shareholders' meeting of the company can be done in the form of announcement.

Chapter 4 Directors and Audit Committee

Article 16: The company has five to nine directors, all of whom are elected by the shareholders' meeting who are capable of conduct. The term of office is three years, and they may be re-elected. The number of independent directors established in the number of directors in the preceding paragraph shall not be less than two, and shall not be less than one-fifth of the number of directors. The election of directors adopts the candidate nomination system in Article 192 of the Company Act, and the shareholders shall select from the list of candidates for directors. The method of accepting the nomination of director candidates, announcements and other related matters shall be handled in accordance with relevant laws and regulations of the Company Act and the Securities Exchange Law. However, the total number of registered shares held by all directors shall be handled in accordance with the " Rules and Review Procedures for Director and Supervisor Share

Ownership Ratios at Public Companies" issued by the competent authority.

Article 16-1: The company shall set up an audit committee in accordance with Article 14-4 of the Securities Exchange Act, and the audit committee shall be responsible for implementing the supervisory authority of the Company Act, the Securities Exchange Act and other laws. The audit committee shall be composed of all independent directors with no less than three persons, one of whom has accounting or financial expertise, and one of them shall be the convener. The resolution of the audit committee shall be approved by more than half of all members.
Article 17: When the vacancy of directors reaches one-third, the board of directors shall convene a by-election at an interim meeting of shareholders within 60 days.
Article 18: When the term of office of a director expires and is not time for reelection, his executive duties shall be extended until the time when the re-elected director takes office.

Article 19: The directors organize the board of directors. The board of directors shall, with the presence of more than two-thirds of the directors and the approval of more than half of the directors present, elect one of them as chairman, and may elect one of them as vice chairman according to actual needs.

The chairman of the board of directors performs all affairs of the company in accordance with laws, regulations, resolutions of the shareholders meeting or the board of directors.
Article 20: The company’s operating policies and other important matters shall be resolved by the board of directors. Except for the first meeting of the board of directors in accordance with Article 203 of the Company Act, the board of directors shall convene and serve as the chairman of the board of directors. When applying for leave or unable to exercise authority for some reason, the agency shall handle it in accordance with Article 208 of the Company Act.
Article 21: The board of directors of the company shall notify the directors of the meeting seven days before the meeting, and specify the time, place, and reason for the meeting. However, it must be called at any time in case of emergency. The convocation of the board of directors may be notified in writing, fax or e-mail.
Board meetings shall be attended by the directors in person. If the directors cannot attend in person, they may appoint other directors to act as agents. Unless otherwise stipulated by the Company Act, the resolution of the board of directors shall be attended by more than half of the directors and shall be carried out with the consent of more than half of the directors present.

Article 22: The minutes of the board of directors shall be prepared and signed or sealed by the chairman, and the minutes shall be distributed to all directors within 20 days after the meeting. The minutes shall record the essentials and results of the meetings. The minutes should be kept in the company together with the signature book of the directors present and the proxy attendance letter.
Article 23: Deleted.
Article 23-1: When the directors of the company perform their business, regardless of the company's business profit or loss, the payment of their remuneration shall be authorized by the board of directors to decide. The board of directors may agree on the extent of its participation in the company's operations and the value of its contribution within 15% of the highest-ranking salary stipulated in the company's salary assessment method. If there is a surplus, remuneration shall be distributed in accordance with the provisions of Article 26.

Chapter 5 Managers

Article 24: The company may appoint a manager. The appointment, dismissal and remuneration shall be made by the board of directors based on the presence of more than half of the directors and a resolution approved by more than half of the directors present.

Chapter 6 Accounting

Article 25: At the end of the fiscal year of the company, the board of directors shall prepare the following books and forms, which shall be submitted to the audit committee for verification 30 days before the meeting of the shareholders' meeting, and then submitted to the shareholders' meeting for recognition.
Business report.
Financial statements.
Proposals for surplus distribution or deficit compensated.

Article 26: (Employee bonus and director bonus)

If the company makes profits for the year, it shall contribute no less than 4% as employee bonus, which shall be distributed in stock or cash by the resolution of the board of directors. The employees of the affiliated company who meet certain conditions shall be granted; the company can increase the amount of profit. The director bonus shall be no more than 3% contributed by the resolution of the board of directors. The distribution of employee bonus and director bonus shall be reported to the shareholders meeting.

However, when the company still has accumulated losses, it shall reserve the compensation amount in advance, and then contribute the employee bonus and director bonus in proportion to the preceding paragraph.

Article 26-1: (Shareholder dividend + dividend policy)

If there is a surplus in the company’s annual final accounts, it should first pay taxes to make up for previous years’ losses. Ten percent of the second deposit is a legal reserve, but when the legal reserve has reached the company’s paid-in capital, it must no longer be reported. The rest shall be reported or reversed to the special reserve in accordance with the laws and regulations, and the balance shall be added to the accumulated undistributed surplus of the previous year as the distributable surplus, which shall be retained by the board of directors according to the operational needs.

Chapter 7 Supplementary Provisions

Article 27: Any matters not covered in this Articles of Association shall be handled in accordance with the provisions of the Company Act and relevant laws and regulations.

Article 28: This Articles of Association was established on June 18, 1982. The first amendment was made on August 10, 1983. The second amendment was on February 20, 1987. The third amendment was on September 10, 1988. The fourth amendment was on October 10, 1989. The fifth amendment was made on April 30, 1990. The sixth amendment was on June 20, 1990. The seventh amendment was on March 23, 1991. The eighth amendment was on November 4, 1991. The ninth amendment was on March 2, 1992. The tenth amendment was on March 27, 1993. The eleventh amendment was made on April 25, 1994. The twelfth amendment was made on April 29, 1996. The thirteenth amendment was on October 18, 1996. The fourteenth amendment was made on May 7, 1997. The fifteenth amendment took place on May 25, 1998. The sixteenth amendment was on May 27, 1999. The seventeenth amendment was on June 22, 2000. The eighteenth amendment was on June 21, 2002. The nineteenth amendment was on June 20, 2003. The twentieth revision was on June 10, 2005. The twenty-first revision was on June 22, 2007. The twenty-second revision was on June 6, 2008. The twenty-third revision was on June 16, 2009.

The twenty-fourth amendment was made on June 18, 2010. The twenty-fifth amendment was on June 20, 2012. The twenty-sixth amendment was on June 20, 2014. The twenty-seventh amendment was on June 18, 2015. The twenty-eighth amendment was made on June 17, 2016. The twenty-ninth amendment was on June 15, 2018. The thirtieth amendment was on June 21, 2019.

DE LICACY INDUSTRIAL CO., LTD.

Chairman: Ye Jiaming

DE LICACY INDUSTRIAL CO.,LTD. Rules of Procedure for Shareholders Meetings

Passed by the 2020 regular shareholders meeting (2020.06.11)

Article 1: The rules of procedures for this Corporation's shareholders’ meetings, except as otherwise provided by law, regulation, or the articles of incorporation, shall be as provided in these Rules.
Article 2: The preparation of documents such as the attendance book, meeting handbook and annual report
This Corporation shall furnish shareholders and their proxies (collectively, "shareholders") with an attendance book to sign, or attending shareholders may hand in a sign-in card in lieu of signing in.
This Corporation shall furnish attending shareholders with the meeting agenda book, annual report, attendance card, speaker's slips, voting slips, and other meeting materials. Where there is an election of directors, preprinted ballots shall also be furnished.
Shareholders shall attend shareholders’ meetings based on attendance cards, sign-in cards, or other certificates of attendance. Solicitors soliciting proxy forms shall also bring identification documents for verification.
Article 3: 1. The convening of shareholders’ meetings shall notify each shareholder before 30 days. For shareholders who hold the registered share, it may be done by means of a public announcement made through the MOPS before 30 days; The shareholder's temporary meeting should be notified before 15 days, and for shareholders who hold the registered share, it may be done by means of a public announcement made through the MOPS before 15 days
2.Election or dismissal of directors or supervisors, amendments to the articles of incorporation, reduction of capital, application for the approval of ceasing its status as a public company, approval of competing with the company by directors, surplus profit distributed in the form of new shares, reserve distributed in the form of new shares, the dissolution, merger, or demerger of the corporation, or any matter under Article 185, paragraph 1 shall be set out and the essential contents explained in the notice of the reasons for convening the shareholders meeting. None of the above matters may be raised by an extraordinary motion; the essential contents may be posted on the website designated by the competent authority in charge of securities affairs or the corporation, and such website shall be indicated in the above notice. Where re-election of all directors and supervisors as well as their inauguration date is stated in the notice of the reasons for convening the shareholders meeting, after the completion of the re-election in said meeting such inauguration date may not be altered by any extraordinary motion or otherwise in the same meeting.
3.A shareholder holding one percent or more of the total number of issued shares may submit to this Corporation a written proposal for discussion at a regular shareholders meeting. The number of items so proposed,

however, is limited to one only, and no proposal containing more than one item will be included in the meeting agenda, provided a shareholder proposal for urging the corporation to promote public interests or fulfill its social responsibilities may still be included in the agenda by the board of directors. In addition, when the circumstances of any subparagraph of Article 172-1, paragraph 4 of the Company Act apply to a proposal put forward by a shareholder, the board of directors may exclude it from the agenda.

4.Prior to the book closure date before a regular shareholders meeting is held, this Corporation shall publicly announce its acceptance of shareholder proposals in writing or electronically, and the location and time period for their submission; the period for submission of shareholder proposals may not be less than 10 days.
5.Shareholder-submitted proposals are limited to 300 words, and no proposal containing more than 300 words will be included in the meeting agenda. The shareholder making the proposal shall be present in person or by proxy at the regular shareholders meeting and take part in discussion of the proposal.
6.Prior to the date for issuance of notice of a shareholders meeting, this Corporation shall inform the shareholders who submitted proposals of the proposal screening results, and shall list in the meeting notice the proposals that conform to the provisions of this article. At the shareholders meeting the board of directors shall explain the reasons for exclusion of any shareholder proposals not included in the agenda.
Article 4: The principle of holding a shareholder meeting place and time The location of the Company's shareholder will be held in the place of the company or the place which is convenient for shareholders that is suitable for the shareholders' meeting. The beginning of the meeting shouldn't be earlier than 9 o'clock in the morning or after three pm.
Article 5: Chairman of the Shareholders, attendees
Unless otherwise provided by law or regulation, this Corporation's shareholders meetings shall be convened by the board of directors; If a shareholders meeting is convened by a party with power to convene but other than the board of directors, the convening party shall chair the meeting. When there are two or more such convening parties, they shall mutually select a chair from among themselves.
If a shareholders meeting is convened by the board of directors, the meeting shall be chaired by the chairperson of the board. When the chairperson of the board is on leave or for any reason unable to exercise the powers of the chairperson, its agent is handled in accordance with the third paragraph of Article 208 of the Company Act.
There should be more than over half of the directors to participate in the shareholders' meeting convened by the board of directors.
4.This Corporation may appoint its attorneys, certified public accountants, or related persons retained by it to attend a shareholders meeting in a non-voting capacity.

Article 6: 1. For each shareholders meeting, a shareholder may appoint a proxy to attend the meeting by providing the proxy form issued by this Corporation and stating the scope of the proxy's authorization.
2.A shareholder may issue only one proxy form and appoint only one proxy for any given shareholders meeting, and shall deliver the proxy form to this Corporation before five days before the date of the shareholders meeting. When duplicate proxy forms are delivered, the one received earliest shall prevail unless a declaration is made to cancel the previous proxy appointment.
3.After a proxy form has been delivered to this Corporation, if the shareholder intends to attend the meeting in person or to exercise voting rights by correspondence or electronically, a written notice of proxy cancellation shall be submitted to this Corporation before two business days before the meeting date. If the cancellation notice is submitted after that time, votes cast at the meeting by the proxy shall prevail.
4.When this Corporation holds a shareholder meeting, it shall adopt exercise of voting rights by electronic means and may adopt exercise of voting rights by correspondence. When voting rights are exercised by correspondence or electronic means, the method of exercise shall be specified in the shareholders meeting notice. A shareholder exercising voting rights by correspondence or electronic means will be deemed to have attended the meeting in person, but to have waived his/her rights with respect to the extraordinary motions and amendments to original proposals of that meeting; it is therefore advisable that this Corporation avoid the submission of extraordinary motions and amendments to original proposals.
5.A shareholder intending to exercise voting rights by correspondence or electronic means under the preceding paragraph shall deliver a written declaration of intent to this Corporation before two days before the date of the shareholders meeting. When duplicate declarations of intent are delivered, the one received earliest shall prevail, except when a declaration is made to cancel the earlier declaration of intent.
- After a shareholder has exercised voting rights by correspondence or electronic means, in the event the shareholder intends to attend the shareholders meeting in person, a written declaration of intent to retract the voting rights already exercised under the preceding paragraph shall be made known to this Corporation, by the same means by which the voting rights were exercised, before two business days before the date of the shareholders meeting. If the notice of retraction is submitted after that time, the voting rights already exercised by correspondence or electronic means shall prevail.
When a shareholder has exercised voting rights both by correspondence or electronic means and by appointing a proxy to attend a shareholders meeting, the voting rights exercised by the proxy in the meeting shall prevail.

Article 7: Documentation of a Shareholders Meeting by Audio or Video

This Corporation shall make an uninterrupted audio and video recording of the proceedings of the shareholders meeting. The recorded materials shall be

retained for at least one year. If, however, a shareholder files a lawsuit pursuant to Article 189 of the Company Act, the recording shall be retained until the conclusion of the litigation.

Article 8: 1. Attendance at shareholders’ meetings shall be calculated based on numbers of shares. The number of shares in attendance shall be calculated according to the shares indicated by the attendance book and sign-in cards.
he chair shall call the meeting to order at the appointed meeting time. However, when the attending shareholders do not represent a majority of the total number of issued shares, the chair may announce a postponement, provided that no more than two such postponements, for a combined total of no more than one hour, may be made. If the quorum is not met after two postponements and the attending shareholders still represent less than one third of the total number of issued shares, the chair shall declare the meeting adjourned.
If the quorum is not met after two postponements as referred to in the preceding paragraph, but the attending shareholders represent one third or more of the total number of issued shares, a tentative resolution may be adopted pursuant to Article 175, paragraph 1 of the Company Act; all shareholders shall be notified of the tentative resolution and another shareholders meeting shall be convened within one month.
When, prior to conclusion of the meeting, the attending shareholders represent a majority of the total number of issued shares, the chair may resubmit the tentative resolution for a vote by the shareholders meeting pursuant to Article 174 of the Company Act.

Article 9: Discussion of Proposals

1.If a shareholders meeting is convened by the board of directors, the meeting agenda shall be set by the board of directors. Votes shall be cast on each separate proposal in the agenda (including extraordinary motions and amendments to the original proposals set out in the agenda). The meeting shall proceed in the order set by the agenda, which may not be changed without a resolution of the shareholders meeting.
2.The provisions of the preceding paragraph apply mutatis mutandis to a shareholders meeting convened by a party with the power to convene that is
not the board of directors.
3.The chair may not declare the meeting adjourned prior to completion of deliberation on the meeting agenda of the preceding two paragraphs (including extraordinary motions), except by a resolution of the shareholders meeting.
4.If the chair declares the meeting adjourned in violation of the rules of rocedure,
the other members of the board of directors shall electing a new chair, by agreement of a majority of the votes represented by the attending shareholders, and then continue the meeting.

Article 10: Shareholder speech

1.Before speaking, an attending shareholder must specify on a speaker's slip the subject of the speech, his/her shareholder account number (or attendance card number), and account name. The order in which shareholders speak

will be set by the chair.

2.A shareholder in attendance who has submitted a speaker's slip but does not actually speak shall be deemed to have not spoken. When the content of the
speech does not correspond to the subject given on the speaker's slip, the spoken content shall prevail.
3.Except with the consent of the chair, a shareholder may not speak more than twice on the same proposal, and a single speech may not exceed 5 minutes. If the shareholder's speech violates the rules or exceeds the scope of the agenda item, the chair may terminate the speech.
4.When an attending shareholder is speaking, other shareholders may not speak or interrupt unless they have sought and obtained the consent of the chair and the shareholder that has the floor; the chair shall stop any violation.
5.When the government or juristic person is a shareholder, its representative is not limited to one person. When the juristic person was attended by the shareholder meeting, the juristic person can only assign a representative of one person. When a juristic person shareholder appoints two or more representatives to attend a shareholders meeting, only one of the representatives so appointed may speak on the same proposal.
6.After an attending shareholder has spoken, the chair may respond in person
or direct relevant personnel to respond.

Article 11: Election of directors

1.The election of directors at a shareholders meeting shall be held in accordance with the applicable election and appointment rules adopted by this Corporation, and the voting results shall be announced on-site immediately.
2.The ballots for the election referred to in the preceding paragraph shall be sealed with the signatures of the monitoring personnel and kept in proper custody for at least one year. If, however, a shareholder files a lawsuit pursuant to Article 189 of the Company Act, the ballots shall be retained until the conclusion of the litigation.

Article 12: The Meeting Minutes

1.Matters relating to the resolutions of a shareholders meeting shall be recorded in the meeting minutes. The meeting minutes shall be signed or sealed by the chair of the meeting and a copy distributed to each shareholder within 20 days after the conclusion of the meeting. The meeting minutes may be produced and distributed in electronic form.
2.This Corporation may distribute the meeting minutes of the preceding paragraph by means of a public announcement made through the MOPS.
3.The meeting minutes shall accurately record the year, month, day, and place of the meeting, the chair's full name, the methods by which resolutions were adopted, and a summary of the deliberations and their voting results (including the number of voting rights), and disclose the number of voting rights won by each candidate in the event of an election of directors or supervisors. The minutes shall be retained for the duration of the existence of this Corporation.

4.The resolution method in the preceding paragraph is based on the chairman's consultation with shareholders. If the shareholders have no objection to the proposal, it should be stated that "Approved without objection after the chairman consulted all the shareholders present"; However, if shareholders disagree with the proposal and put it to the vote, the method of voting and the number of voting rights and the ratio of the number of voting rights should be stated.
5.The minutes of the shareholders' meeting shall be kept permanently during the company's existence, and the company should disclose it when the company has a website.

Article 13: Public disclosure

1.On the day of a shareholders meeting, this Corporation shall compile in the prescribed format a statistical statement of the number of shares obtained by solicitors through solicitation and the number of shares represented by proxies, and shall make an express disclosure of the same at the place of the shareholders meeting.
2.If matters put to a resolution at a shareholders meeting constitute material information under applicable laws or regulations or under Taiwan Stock Exchange Corporation regulations, this Corporation shall upload the content of such resolution to the MOPS within the prescribed time period.

Article 14: Discussion of proposals

The chair shall allow ample opportunity during the meeting for explanation and discussion of proposals and of amendments or extraordinary motions put forward by the shareholders; when the chair is of the opinion that a proposal has been discussed sufficiently to put it to a vote, the chair may announce the discussion closed, call for a vote, and schedule sufficient time for voting.

Article 15: Calculation of voting shares and recusal system

1.Voting at a shareholders meeting shall be calculated based on the number of shares.
2.With respect to resolutions of shareholders’ meetings, the number of shares held by a shareholder with no voting rights shall not be calculated as part of the total number of issued shares.
3.When a shareholder is an interested party in relation to an agenda item, and there is the likelihood that such a relationship would prejudice the interests of this Corporation, that shareholder may not vote on that item, and may not exercise voting rights as proxy for any other shareholder.
4.The number of shares for which voting rights may not be exercised under the preceding paragraph shall not be calculated as part of the voting rights represented by attending shareholders.
5.With the exception of a trust enterprise or a shareholder services agent approved by the competent securities authority, when one person is concurrently appointed as proxy by two or more shareholders, the voting rights represented by that proxy may not exceed three percent of the voting

rights represented by the total number of issued shares. If that percentage is exceeded, the voting rights in excess of that percentage shall not be included in the calculation.

Article 16: 1.A shareholder shall be entitled to one vote for each share held, except when the shares are restricted shares or are deemed non-voting shares under Article 179, paragraph 2 of the Company Act.
2.Vote monitoring and counting personnel for the voting on a proposal shall be appointed by the chair, provided that all monitoring personnel shall be shareholders of this Corporation. Vote counting shall be conducted in public at the place of the shareholders meeting. Immediately after vote counting has been completed, the results of the voting shall be announced on-site at the meeting, and a record made of the vote.

Article 17: Recess and resumption of a shareholders meeting

1.When a meeting is in progress, the chair may announce a break based on time considerations. If a force majeure event occurs, the chair may rule the meeting temporarily suspended and announce a time when, in view of the circumstances, the meeting will be resumed.
2.If the meeting venue is no longer available for continued use and not all of the items (including extraordinary motions) on the meeting agenda have
been addressed, the shareholders meeting may adopt a resolution to resume the meeting at another venue.
3.A resolution may be adopted at a shareholders meeting to defer or resume the meeting within five days in accordance with Article 182 of the Company
Act.
Article 18: 1. Except as otherwise provided in the Company Act and in this Corporation's articles of incorporation, the passage of a proposal shall require an affirmative vote of a majority of the voting rights represented by the attending shareholders. At the time of a vote, for each proposal, the chair or a person designated by the chair shall first announce the total number of voting rights represented by the attending shareholders.
2.The proposal is approved by the chairman in consultation with all shareholders present who have no objections, and its effect is the same as that passed by voting; if there are objections, the voting shall be adopted in accordance with the provisions of the preceding paragraph.
Article 19: When there is an amendment or an alternative to a proposal, the chair shall present the amended or alternative proposal together with the original proposal and decide the order in which they will be put to a vote. When any one among them is passed, the other proposals will then be deemed rejected, and no further voting shall be required.

Article 20: Maintaining order at the meeting place

Staff handling administrative affairs of a shareholders meeting shall wear identification cards or arm bands.
The chair may direct the proctors or security personnel to help maintain

order at the meeting place. When proctors or security personnel help maintain order at the meeting place, they shall wear an identification card or armband.

At the place of a shareholders meeting, if a shareholder attempts to speak through any device other than the public address equipment set up by this Corporation, the chair may prevent the shareholder from doing so.
When a shareholder violates the rules of procedure and defies the chair's correction, obstructing the proceedings and refusing to heed calls to stop, the chair may direct the proctors or security personnel to escort the shareholder from the meeting.
Article 21: For undecided matters in this rule, the company Act and the relevant rules of procedure promulgated by the competent authority shall apply.
Article 22: These Rules shall take effect after having been submitted to and approved by a shareholders meeting. Subsequent amendments thereto shall be effected in the same manner.

Effect upon business performance and earnings per share of any stock dividend distribution proposed or adopted at the most recent shareholders' meeting.

Effect upon business performance and earnings per share of any stock dividend distribution proposed or adopted at the most recent shareholders'meeting.	Effect upon business performance and earnings per share of any stock dividend distribution proposed or adopted at the most recent shareholders'meeting.	Effect upon business performance and earnings per share of any stock dividend distribution proposed or adopted at the most recent shareholders'meeting.
Item Year 2020
The amount of paid-in capital at the beginning of the period NTD$3,845,656,52 0
Dividend distribution this year	Cash dividend per share NTD$0
	Number of allotment shares per share for capital increase from earnings 0.30 shares
	Number of allotment shares per share for capital surplus transferred to common stock 0 shares
Changes in business performance
Pro forma earnings per share and price earnings i	If the surplus is changed to capital increase, the cash dividend will be found
	If there is not applied for capital reserve transferred to common stock
ratos	If the capital reserve has not been handled, and the surplus is transferred to capital increase, it will be paid by cash dividends	Proposed earnings per share

Note 1: As of the resolution of the 2021 regular shareholders meeting Note 2: According to the Taiwan Financial Certificate (1) Zi No. 00371 letter dated February 1, 2000 (2000) of the Securities and Futures Bureau, the company is not required to prepare and announce the 2020 financial forecast, so there is no need to disclose this information.

DE LICACY INDUSTRIAL CO., LTD. Directors’ shareholding

The company’s paid-in capital is NT 3,845,656,520, and the number of issued shares is 384,565,652 shares.
According to Article 26 of the Securities and Exchange Act, all directors (excluding independent directors) should hold a minimum of 15,382,626 shares.
The number of shares held by individual and all directors (including independent directors) as recorded in the shareholder register as of the closing date of the shareholders meeting is as follows:

==> picture [450 x 398] intentionally omitted <==

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

April 12, 2021
Title Name Number of shares Shareholding
held ratio
Chairman of
Ye Jiaming 3,288,181 0.86%
the board
Fuhua Investment (Stock)
director Company
Representative: Ye Jiahao
Fuhua Investment (Stock)
director Company
30,000,994 7.80%
Representative: Ye Weili
Fuhua Investment (Stock)
Company
director
Representative: Guo
Junxiong
Independent
Huang Junren 60,577 0.01%
director
Independent
Su Baicheng 12,762 0.00%
director
Independent
Cai Qijun 0 0.00%
director
Total number of shares held by non-
33,289,175 8.66%
independent directors
Number of shares held by all directors 33,362,514 8.67%
----- End of picture text -----

Note: The book closure date of this regular shareholder meeting is from 2021.04.12 to 2021.06.10.

AI assistant

DE LICACY — AGM Information 2021

51822_rns_2021-07-30_d5159f1e-e897-401e-956c-c39203991d89.pdf

Stock code ： 1464

DE LICACY INDUSTRIAL CO., LTD.

DE LICACY INDUSTRIAL CO., LTD.

Table of Content of Meeting Agenda of Shareholders’ meeting in 2021 Meeting agenda

Announcements

DE LICACY INDUSTRIAL CO., LTD. Meeting Agenda of Shareholders’ meeting in 2021

3. Announcements

Announcements

Case 1:

Case 2 ：

Cause of action: 2020 Annual Business Report

2020 Annual Business Report

1.Business report of the previous year (2020)

(1) Implementation results of the business plan:

Case 3 ：

Case 4:

Case 5:

Acknowledgement

Opinion

Basis of Opinion

Key Audit Matter

Other Matters

Management's and Governance's Responsibility for the Individual Financial Statements

Auditors’ Responsibilities for the Audit of the Financial Statements

Notice to Readers

De Licacy Industrial Co., Ltd.

Individual Income Statement

De Licacy Industrial Co., Ltd.

Individual Income Statements

De Licacy Industrial Co., Ltd

De Licacy Industrial Co., Ltd. Individual Cash Flows Statement

1 January to 31 December 2020 and 2019

Opinion

Basis of Opinion

Key Audit Matter

Other Matters

Management's and Governance's Responsibility for the Consolidated Financial Statements

Auditors’ Responsibilities for the Audit of the Financial Statements

Notice to Readers

De Licacy Industrial Co., Ltd.and Subsidiaries Consolidated Balance Sheets The Years Ended December 31, 2020 and 2019

De Licacy Industrial Co., Ltd.and Subsidiaries Consolidated Income Statements For the Years Ended December 31 of 2020 and 2019

(continued from the previous page)

De Licacy Industrial Co., Ltd.and Subsidiaries Consolidated Statements of Changes in Equity For the Years Ended December 31, 2020 and 2019

.De Licacy Industrial Co., Ltd.and Subsidiaries Consolidated Statements of Cash Flows For the years ended December 31 of 2020 and 2019

Discussion matters

2.The comparison table of revised articles is as follows:

Extraordinary motions

Articles of DE LICACY INDUSTRIAL CO., LTD.

Chapter 1 General Provisions

Chapter 2 Shares

Chapter 3 Shareholders’ meeting

Chapter 5 Managers

Chapter 6 Accounting

Article 26: (Employee bonus and director bonus)

Chapter 7 Supplementary Provisions

Passed by the 2020 regular shareholders meeting (2020.06.11)

Article 7: Documentation of a Shareholders Meeting by Audio or Video

Article 9: Discussion of Proposals

Article 10: Shareholder speech

Article 13: Public disclosure

Article 14: Discussion of proposals

Effect upon business performance and earnings per share of any stock dividend distribution proposed or adopted at the most recent shareholders' meeting.

DE LICACY INDUSTRIAL CO., LTD. Directors’ shareholding

More from DE LICACY

DE LICACY AGM Information 2021