EnTie Bank - Proxy Solicitation & Information Statement 2021

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EnTie Commercial Bank Co., Ltd.

Notice of 2021 First Extraordinary General Meeting of Shareholders

(This translated meeting notice is prepared in accordance with the Chinese version and is for reference only. In the

event of any inconsistency between the Chinese version and English version, the Chinese version shall prevail.)

The First Extraordinary Meeting of Shareholders of EnTie Commercial Bank Co., Ltd. (the “Bank”) in 2021 will be convened on Thursday, December 2, 2021, at 9:00 a.m. at No. 11, Zhongshan S. Rd., Zhongzheng Dist.,Taipei City (CHANG YUNGFA FOUNDATION International Convention Center).

The proposed agenda is as follows:

(i) Reporting Items:

To note for record the Company’s Audit Committee’s review report on the share swap agreement between IBF Financial Holdings (hereinafter referred to as “IBF”) and the Company

(ii) Discussion Items:

To approve the share swap agreement the Bank signed with IBF Financial Holdings for a share swap, after which the Bank will become a wholly-owned subsidiary of IBF and submit an application to delist its securities from the Taiwan Stock Exchange in accordance with relevant laws and regulations, if the shareholders’ meeting passes the share swap proposal by resolution

(iii) Extemporaneous Motions

Any description of the main contents of agenda items listed in the cause(s) or subject(s) of a meeting of shareholders to be convened in accordance with Article 172 of the Company Act can be found in “reference materials for shareholders' meeting agenda items or agenda book and supplementary meeting materials”,” ticker symbols or years”, “annual reports and shareholders' meeting materials”, ”e-books”, and “summaries” on the Market Observation Post System website(https://mops.twse.com.tw/).
According to Article 165 of the Company Act, the book closure period will be from November 3, 2021 to December 2, 2021.
Enclosed are the notice of attendance and proxy form (one copy for each). A shareholder attending the Meeting in person shall sign or chop on the notice of attendance and bring along the signed/chopped notice to the meeting (no return of the notice by mail is needed if the shareholder is attending in person). A shareholder appointing a proxy to attend the meeting shall sign or

chop on the proxy form, fill out the name, address, signature or seal of the proxy, and deliver (by mail) such proxy form to the Bank’s shareholder services agent, Stock Affairs Division of Capital Securities Corporation (“Capital Securities”) no later than five (5) days before the meeting date. An attendance sign-in card will be produced and sent to the shareholder’s proxy holder by the shareholder services agent so that he/she can attend the shareholders' meeting with it.

If public solicitation of proxies for the shareholders' meeting is applicable, the Bank will upload relevant information to the website of the Securities and Futures Institute by November 16, 2021. For more information, investors may directly visit the website at http://free.sfib.org.tw, go to “Free Inquiry System on Announcement of Proxy Solicitation Related Information”, click on “Enter Proxy Solicitation and Meeting Information”, and key in the search terms.
Shareholders may exercise their voting power by way of electronic transmission upon receipt of the meeting notice from November 17, 2021 to November 29, 2021 by logging into the “Electronic Voting Platform for Shareholders” on the website of Taiwan Depository and Clearing Corporation (http://www.stockvote.com.tw) and following the instructions as described on the website.
The Stock Affairs Division of Capital Securities Corporation has been appointed to verify, consolidate and count the proxy forms during the shareholders' meeting.

III. Attachment:

Attachment 1

To: 1[st] Extraordinary Shareholders’ Meeting of EnTie Commercial Bank in 2021

Audit Committee’s Review Report on the Company’s Share Swap with IBF Financial Holdings Co., Ltd.

Pursuant to Article 6 of the Business Mergers and Acquisitions Act and Articles 2 and 6 of the Regulations Governing the Establishment and Related Matters of Special Committees of Public Companies for Merger/Consolidation and Acquisition, the Audit Committee (the “Committee”) shall exercise the powers of the special committee.
In accordance with the said regulations, the Committee has engaged CPA Shu-Chen Chang of BDO Taiwan as an independent expert to issue an opinion on the fairness of the transaction consideration. The independent expert used the comparable companies method in the market approach and the market price method and other valuation techniques to obtain the value range. Eventually, the independent expert used the market price method of the Level 1 valuation technique input to determine the reasonable range of the Company’s equity value per share on the valuation base date (i.e., October 14, 2021) which ranged from NT$17.04 to NT$18.67. In addition, the independent expert used the valuation technique of matrix pricing in the market approach and eventually concluded that the theoretical value of each share of the preferred shares issued by IBF Financial Holdings Co., Ltd. (“IBF”) ranges from NT$16.20 to NT$16.59. Moreover, it is deemed appropriate to have the issue price per share lower than the theoretical value. Given the Company’s current operation status and going-concern assumption, the independent expert, based on the foregoing results of the Transaction Consideration, thinks that if the Company adopts the share swap price (IBF pays 55% in cash and 45% in preferred share issued by IBF) within the said equity value range to carry out the Share Swap or the Company determines the Transaction Consideration based on the best interest of its shareholders, it is reasonable in terms of shareholders’ interests protection. In consideration of the Company’s market price, operating conditions, future development and other relevant factors, the transaction consideration is within the reasonable equity value range prescribed in the fairness opinion on the share swap price. The Company’s Share Swap Agreement negotiation with IBF has taken into account factors including the Company and IBF’s financials, businesses, overall operations and other relevant factors. Therefore, the terms of the proposed Share Swap shall be fair and reasonable. All of the attending Committee members unanimously agreed to pass the Share Swap and submit the review result to the Company’s board of directors and the shareholders’ meeting.

Issued by Philippe Espinasse, Convener of Audit Committee, October 14, 2021

Attachment 2

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

SHARE SWAP AGREEMENT

between

IBF Financial Holdings Co., Ltd.

and

Entie Commercial Bank Co., Ltd.

October 14, 2021

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Table of Content

		Table of Content
Article	1	Share Swap ......................................................................................................... 1
Article	2	Pre-Share Swap Amounts of Capital, Number and Types of Outstanding
		Shares ................................................................................................................. 2
Article	3	Share Swap Transaction Consideration, Share Swap Ratio, and
		Amendments to Articles of Incorporation ....................................................... 2
Article	4	Transaction Consideration Adjustment .......................................................... 4
Article	5	Share Swap Schedule ......................................................................................... 9
Article	6	Condition Precedents to the Share Swap ....................................................... 10
Article	7	Representations and Warranties .................................................................... 13
Article	8	Covenants ......................................................................................................... 22
Article	9	Handling of Dissenting Shares ........................................................................ 30
Article	10	Directors and Independent Directors of Entie Bank .................................... 30
Article	11	Protection of Rights and Interests of Employees of Entie Bank .................. 30
Article	12	Event of Default ............................................................................................... 31
Article	13	Termination ...................................................................................................... 31
Article	14	Taxes and Expenses ......................................................................................... 32
Article	15	Miscellaneous ................................................................................................... 32

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Share Swap Agreement

This share swap agreement (the “Agreement”) is entered into by and between the following parties on October 14, 2021 (the “Signing Date”):

(1) IBF Financial Holdings Co., Ltd. (“IBF Financial Holdings”) is a corporation duly established according to the laws and regulations of the Republic of China, and its address is 17[th] Floor, No. 126, 128, 130, 132, and 7[th] , 9[th] Floor, No. 128, Lecyun 3[rd] Rd., Zhongshan Dist., Taipei City.
(2) Entie Commercial Bank Co., Ltd. (“Entie Bank”) is a corporation duly established according to the laws and regulations of the Republic of China, and its address is 16[th] , 40[th] , 41[st] Floor, No. 7, Sec. 5, Xinyi Rd., Xicun Vil., Xinyi Dist., Taipei City.

(IBF Financial Holdings and Entie Bank, each referred to as a “Party”; collectively referred to as the “Parties”)

WHEREAS, to strengthen their competitiveness, both Parties plan to execute a share swap in accordance with the Financial Holding Company Act, the Business Mergers and Acquisitions Act, the Banking Act and the relevant laws, whereby IBF Financial Holdings will pay cash and issue preferred shares to the shareholders of Entie Bank pursuant to the Agreement as the consideration of obtaining all issued shares of Entie Bank (the “Matter” or the “Share Swap”). After the Share Swap is complete, Entie Bank will become a 100% wholly owned subsidiary of IBF Financial Holdings.

Based on the facts above, the Parties hereby enter into the Agreement and agree as follows:

Article 1 Share Swap

Both Parties agree to execute a share swap in accordance with the Financial Holding Company Act, the Business Mergers and Acquisitions Act, the Banking Act and relevant laws, whereby IBF Financial Holdings will pay cash and issue preferred shares listed on the Taiwan Stock Exchange Corporation (“TWSE”) (the “IBF Financial Holdings Preferred Share(s)”) on the Share Swap Record Date (as defined in Article 5.2 of the Agreement) to the shareholders of Entie Bank pursuant to the issuing terms listed in the Appendix as the consideration of obtaining all issued shares of Entie Bank. After the Share Swap is complete, Entie Bank will become a

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

100% wholly owned subsidiary of IBF Financial Holdings.

Article 2 Pre-Share Swap Amounts of Capital, Number and Types of Outstanding Shares

2.1. IBF Financial Holdings’ total authorized capital is NT$80,000,000,000, divided into 8,000,000,000 shares of par value NT$10 each. On the Signing Date, the total number of issued shares of IBF Financial Holdings is 2,896,481,695 shares (all are common shares, excluding 101,026,860 shares distributed as stock dividends in 2020), and its paid-in capital is NT$28,964,816,950. On the Signing Date, IBF Financial Holdings holds 10,000,000 treasury shares for transferring to its employees, and has no other issued and outstanding equity-type securities.
2.2. Entie Bank’s total authorized capital is NT$47,600,000,000, divided into 4,760,000,000 shares of par value NT$10 each. On the Signing Date, the total number of issued shares of Entie Bank is 1,957,910,050 shares (including 1,063,113,402 private placement shares), which are all common shares, and its paid-in capital is NT$19,579,100,500. On the Signing Date, Entie Bank does not hold treasury shares and has no other issued and outstanding equity-type securities.
2.3. In this Matter, the number of shares that Entie Bank’s shareholders plan to transfer to IBF Financial Holdings is based on the total number of actual issued common shares on the Share Swap Record Date, but the treasury shares of Entie Bank shall be deducted.

Article 3 Share Swap Transaction Consideration, Share Swap Ratio, and Amendments to Articles of Incorporation

3.1. The Parties agree that the consideration for IBF Financial Holdings to obtain each common share of Entie Bank is: (1) NT$9.466730 in cash (the “Cash Consideration”); (2) 0.493344 shares of IBF Financial Holdings Preferred Shares (0.493344 is the “Share Swap Ratio”; calculated by the planned issuance price of IBF Financial Holdings Preferred Shares, which is NT$15.70 per share (the “Planned Issue Price”), the share consideration shall be NT$7.745501 (the “Share Consideration”, collectively with the Cash Consideration, the “Transaction Consideration”)).
3.2. If the Condition Precedents set forth in Article 6 of the Agreement are all satisfied or have been waived, IBF Financial Holdings shall, on the Share Swap Record Date, pay the

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Transaction Consideration to all shareholders of Entie Bank registered in its shareholders’ roster on the Share Swap Record Date. However, if the Transaction Consideration shall be adjusted according to the Transaction Consideration Adjustment (as defined in Article 4.1 of the Agreement) as set forth in Article 4 of the Agreement, the actual Transaction Consideration to be paid by IBF Financial Holdings shall be calculated and paid according to the Transaction Consideration Adjustment as set forth in Article 4 of the Agreement. IBF Financial Holdings is expected to pay a total of NT$18,535,005,808 in cash and issue a total of 965,923,176 IBF Financial Holdings Preferred Shares to all shareholders of Entie Bank, but the actual total Cash Consideration and IBF Financial Holdings Preferred Shares that IBF Financial Holdings shall pay and issue, and the final issue price of IBF Financial Holdings Preferred Shares (as defined in Article 3.3 of the Agreement) are based on the total number of actual issued shares of Entie Bank as registered in its shareholders’ roster after deducting its treasury shares on the Share Swap Record Date, and are calculated and paid according to the Transaction Consideration Adjustment (if applicable) as provided in Article 4 of the Agreement.

3.3. For the fraction of less than one IBF Financial Holdings Preference Share resulting from the Share Swap to be obtained by Entie Bank’s shareholders, IBF Financial Holdings shall pay the value of fractional share(s) in cash to Entie Bank’s shareholders holding such fractional share(s); the value of the fractional share(s) shall be calculated proportionally in accordance with the issue price of IBF Financial Holdings Preferred Shares applicable on the Share Swap Record Date (i.e., the adjusted Planned Issue Price pursuant to Article 4 of the Agreement (if applicable), the “Final Issue Price of IBF Financial Holdings Preferred Shares”) (conversions will be rounded to the nearest NT dollar), and IBF Financial Holdings’ chairperson or any person designated by the chairperson will seek specific person(s) to purchase such fractional shares at the Final Issue Price of IBF Financial Holdings Preferred Shares. Each Entie Bank’s shareholder shall bear the remittance fees and/or the postage of mailing checks resulting from IBF Financial Holding’s payment of the total Cash Consideration and/or the cash amount calculated according the above provision, and such remittance fees and/or the postage of mailing checks shall be deducted from the amount of the Cash Consideration that IBF Financial Holding shall pay to each Entie Bank’s shareholder. The total amount of the Cash Consideration obtained by each Entie Bank’s shareholder arising from the Share Swap is calculated based on the number of shares held by such shareholder on the Share Swap Record Date; for the amount less than NT$1, it shall be rounded to the nearest NT dollar.
3.4. After the Share Swap is complete, IBF Financial Holdings’ actual paid-in capital and total

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

issued shares (including common shares and IBF Financial Holdings Preferred Shares) may increase or decrease due to the Transaction Consideration Adjustment as provided in Article 4 of the Agreement, the capital increase in cash by issuing common shares or the occurrence other matters as stated in the Agreement. If the contents of Article 3 have changed in accordance with the Agreement due to the above circumstances, IBF Financial Holdings shall provide information related to the actual issued shares, shares to be issued and paid-in capital to Entie Bank in connection with the results of such changes.
3.5. The Articles of Incorporation of Entie Bank shall not be amended prior to the Share Swap Record Date without the prior written consent of IBF Financial Holdings unless such amendments are for compliance of the laws and regulations; provided that IBF Financial Holdings shall not unreasonably withhold or delay in granting such consent. If there is any need for IBF Financial Holdings to amend its Articles of Incorporation prior to the Share Swap Record Date, IBF Financial Holdings shall discuss with Entie Bank, and shall not amend its Articles of Incorporation without the prior written consent of Entie Bank unless such amendments do not affect the execution of the Share Swap, the economic interests and voting rights of the Parties’ shareholders; provided that Entie Bank shall not unreasonably withhold or delay in granting such consent. This Article does not apply to IBF Financial Holdings’ need to change its authorized capital, total shares, and other related matters in its Articles of Incorporation due to the capital increase in cash by issuing common shares for payment of the Cash Consideration of the Share Swap.

Article 4 Transaction Consideration Adjustment

4.1. Both Parties agree that prior to the Share Swap Record Date, the Cash Consideration, Share Swap Ratio, Planned Issue Price, number of Preferred Shares to be issued, Share Consideration and Transaction Consideration shall not be changed unless the Cash Consideration, Share Swap Ratio, Planned Issue Price, number of Preferred Shares to be issued, Share Consideration and/or Transaction Consideration are adjusted according to Articles 4.2 or 4.3 of the Agreement (collectively, the “Transaction Consideration Adjustment”).
4.2. Each Party shall respectively seek for its shareholders’ meeting’s approval to authorize its board of directors to conduct the Transaction Consideration Adjustment according to this Article 4.2 if such Party distributes stock dividends and/or cash dividends from the Signing Date to the Share Swap Record Date; and convention of another shareholder meeting is not required. The following formulas shall apply for the Transaction Consideration

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Adjustment, with the calculations to be rounded to the nearest sixth decimal place. However, for the issuance price of IBF Financial Holdings Preferred Shares after calculation, it shall be rounded to the second decimal place:

4.2.1. The adjustment formula when distributing stock dividends and/or cash dividends:
A. If IBF Financial Holdings distributes cash dividends, the Share Swap Ratio, issue price of IBF Financial Holdings Preferred Shares and the number of IBF Financial Holdings Preferred Shares to be issued shall be adjusted according to the following formula:

Adjusted issue price of IBF Financial Holdings Preferred Shares = the applicable issue price of IBF Financial Holdings Preferred Shares prior to the adjustment according to this Paragraph – the cash dividend per share distributed by IBF Financial Holdings

Adjusted number of IBF Financial Holdings Preferred Shares to be issued

Share Consideration *EOS

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EOS: Entie Bank’s total number of issued shares at that time (excluding its treasury shares)

Adjusted Share Swap Ratio

Share Consideration

= Adjusted issue price of IBF Financial Holdings Preferred Shares

B. If IBF Financial Holdings distributes stock dividends, the Share Swap Ratio, issue price of IBF Financial Holdings Preferred Shares and the number of IBF Financial Holdings Preferred Shares to be issued shall be adjusted according to the following formula:

Adjusted issue price of IBF Financial Holdings Preferred Shares

the applicable issue price of IBF Financial Holdings Preferred Shares prior to the adjustment according to this Paragraph * IOS = （ IOS+ISDS ）

IOS: IBF Financial Holdings’ total number of issued shares at that time (excluding its total number of shares distributed as stock dividends at the time and its treasury shares)

ISDS: Total number of shares distributed by IBF Financial Holdings as stock dividends

Adjusted number of IBF Financial Holdings Preferred Shares to be issued

Share Consideration * EOS

= Adjusted issue price of IBF Financial Holdings Preferred Shares

EOS: Entie Bank’s total issued shares at that time (excluding its treasury shares)

Adjusted Share Swap Ratio

Share Consideration = Adjusted issue price of IBF Financial Holdings Preferred Shares

C. If Entie Bank distributes cash dividends, the Cash Consideration shall be adjusted according to the following formula:

Adjusted Cash Consideration =

Cash Consideration prior to this adjustment – cash dividend per share of Entie Bank

The Share Swap Ratio, issue price of IBF Financial Holdings Preferred Shares and the number of IBF Financial Holdings Preferred Shares will not be adjusted.

D. If Entie Bank distributes stock dividends, the Transaction Consideration and Share Swap Ratio shall be adjusted according to the following formula:

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Adjusted Transaction Consideration=[Transaction Consideration ][prior to this adjustment][* EOS] （ EOS+ESDS ）

EOS: Entie Bank’s total number of issued shares at that time (excluding its total number of shares distributed as stock dividends at that time and its treasury shares)

ESDS: Entie Bank’s total number of shares distributed as the stock dividends at the time

The adjusted Cash Consideration shall be 55 percent (55%) of the adjusted Transaction Consideration

Adjusted Share Swap Ratio

45 percent (45%) of the adjusted Transaction Consideration
= the applicable issue price of IBF Financial Holdings Preferred Shares prior to the adjustment according to this Paragraph

The issue price and number of IBF Financial Holdings Preferred Shares to be issued will not be adjusted

4.2.2. For the avoidance of doubt, (1) if multiple Paragraphs of Article 4.2.1 of the Agreement occurs simultaneously, the adjustment formulas shall apply on an accumulated basis. For instance, if IBF Financial Holdings resolves to distribute cash dividends as well as stock dividends in the same shareholders’ meeting, and the relevant ex-dividend dates are set on the date prior to the Share Swap Record Date, it shall be adjusted according to Paragraphs A first then Paragraph B. (2) If the relevant ex-dividend date of any dividends distribution as provided in Paragraphs A to D of Article 4.2.1 of the Agreement is set on the date after the Share Swap Record Date, the Transaction Consideration Adjustment shall not apply to such dividends distribution.
4.2.3. If any matter as provided in Paragraphs A to D of Article 4.2.1 of the Agreement occurs to either Party, such Party inform the other Party in writing of such matters and the results of the adjustment within 5 business days, and provide relevant information based on reasonable requests by the other Party. After the other Party

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

confirms in writing, both Parties shall issue public announcements pursuant to relevant laws as well as regulations and Article 8.8 of the Agreement and handle the procedures as provided in Article 4.5 of the Agreement accordingly.

4.3. Each Party shall seek for its shareholders’ meeting’s approval to authorize its board of directors that: if any of the following event (the “Price Adjustment Event”) occurs to either Party from the Signing Date to the Share Swap Record Date, unless otherwise provided in the Agreement, the other Party (the “Party Entitled of Adjustment”) may request for negotiation with such Party and both Parties shall jointly negotiate and conduct reasonable Transaction Consideration Adjustment in good faith; and both Parties’ boards of directors shall complete the adjustment within 20 business days after the occurrence of each matter or within the time as otherwise agreed to by both Parties, while convention of another shareholders’ meeting is not required. After both Parties complete the Transaction Consideration Adjustment in accordance with Article 4.3 of the Agreement, the Price Adjustment Event(s) shall not constitute the nonfulfillment of the Condition Precedents as provided in Articles 6.2.1, 6.2.2, 6.2.4, 6.3.1, 6.3.2 or 6.3.4 of the Agreement nor the breach of contract as provided in Article 12 of the Agreement. If both Parties are unable to reach a consensus in respect of the Transaction Consideration Adjustment in good faith within the said period, the Party Entitled of Adjustment may terminate the Agreement.
4.3.1 Conducting of cash capital increase (excluding IBF Financial Holdings’ cash capital increase by issuing common shares for payment of the Cash Consideration of the Share Swap), distribution of stock dividends without consideration (excluding distribution of stock dividends by IBF Financial Holdings or Entie Bank pursuant to Article 4.2.1 of the Agreement, where the Article 4.2 of the Agreement shall apply), issuance of convertible bonds, issuance of corporate bonds with warrants, issuance of share subscription warrants and/or other equity-type securities (excluding IBF Financial Holdings Preferred Shares), or capital reduction;
4.3.2 The occurrence of a material disaster, material loss or Force Majeure Event (as defined in Article 15.6 of the Agreement), each of which has a Material Adverse Effect on financial conditions, business, operations or shareholders’ equity;
4.3.3 Disposal of the company’s material assets which has a Material Adverse Effect on such company; or any other action which has a Material Adverse Effect on the company’s financial conditions or business;

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

4.3.4 Buyback of treasury shares pursuant to the laws or any other event of obtaining its own shares pursuant to the laws, except for, for the purpose of completing the Share Swap, buyback of Entie Bank’s shares from the Dissenting Shareholders (as defined in Article 9 of the Agreement) by Entie Bank according to Article 9 of the Agreement (“Entie Bank Dissenting Shares”) or buyback of IBF Financial Holdings’ shares from the Dissenting Shareholders by IBF Financial Holdings according to Article 9 of the Agreement (“IBF Financial Holdings Dissenting Shares”).
4.3.5 When it is necessary to conduct Transaction Consideration Adjustment either due to the relevant competent authorities’ direction or the written consent of both Parties in order to smoothly obtain relevant competent authorities’ approvals for the Share Swap (for the avoidance of doubt, if any event under this Paragraph occurs, both Parties are the Parties Entitled of Adjustment);
4.3.6 Either Party breaches Article 7 (Representations and Warranties) and Article 8 (Covenants of the Agreement), which has a Material Adverse Effect on such Party; or
4.3.7 Other events which results in or may result in the share dilution of such Party.
4.4. The “Material Adverse Effect” as provided in Article 4.3 of the Agreement means the occurrence of Price Adjustment Event(s) which, individually or in total, cause or are reasonably expected to cause the net value of either Party to cumulatively decrease by more than 10% compared with the net value of the audited consolidated financial statements dated June 30, 2021. In estimating the losses incurred from the said event, the unrealized losses on valuation of financial assets measured at fair value through other comprehensive income shall be excluded.
4.5. Both Parties, after conducting the Transaction Consideration Adjustment pursuant to Article 4 of the Agreement, shall apply for or modify the necessary approvals or permits with the competent authorities pursuant to laws and regulations.

Article 5 Share Swap Schedule

5.1. Unless otherwise agreed by both Parties, both Parties shall respectively convene

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

extraordinary shareholders’ meetings to resolve this Matter and the Agreement prior to December 15, 2021.

5.2. If the Condition Precedents as provided under Article 6 of the Agreement are all satisfied or have been waived, the Share Swap shall be completed on the Share Swap Record Date which is determined by both Parties’ boards of directors according to laws and regulations and this Article 5.2 (the “Share Swap Record Date”). Both Parties’ boards of directors or other persons authorized by the relevant board of directors shall determine the Share Swap Record Date by a resolution or other legitimate ways within 7 business days after obtaining the last Regulatory Approval (as defined in Article 6.1.5 of the Agreement).
5.3. If the Condition Precedents as provided in Article 6 of the Agreement are all satisfied or have been waived, IBF Financial Holdings will issue IBF Financial Holdings Preferred Shares to all shareholders of Entie Bank on the Share Swap Record Date in exchange for Entie Bank’s common shares held by such shareholders; Entie Bank will be delisted from the TWSE on the Share Swap Record Date. After this Matter is approved by resolutions of the shareholders’ meetings of both Parties, the Parties shall coordinate with each other , prepare all relevant documents and proceed with the application in order to obtain the Regulatory Approval as provided under Article 6.1.5 of the Agreement as soon as possible.
5.4. Both Parties shall implement the Share Swap according to the schedule as set forth in the Agreement. If the Parties are unable to complete the procedures of this Share Swap pursuant to Article 5.2 of the Agreement, unless otherwise provided in the Agreement, both Parties shall negotiate to revise the schedule through their boards of directors or any other persons authorized by the relevant board of directors for continuously implementing the Share Swap under the premise that it is practicable.

Article 6 Conditions Precedent to the Share Swap

6.1. The conditions precedent for both of IBF Financial Holdings and Entie Bank (or, as a condition precedent may be waived according to its nature, both Parties have agreed to waive such condition precedent) include:
6.1.1. The Matter and the Agreement have been approved by the resolutions of shareholders’ meetings of IBF Financial Holdings and Entie Bank.
6.1.2. For its capital increase in cash by issuing common shares for payment of the Cash

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Consideration of the Matter, IBF Financial Holdings has filed with the FSC for effective registration, the fundraising has been fulfilled and the payments for the shares have been fully paid.

6.1.3. IBF Financial Holdings has obtained the consent or waiver to the Matter from Rakuten Bank, Ltd. (Japan) and Rakuten Card Co., Ltd. (Japan) in accordance with the agreement (the “Rakuten Consent”), and the Rakuten Consent is still effective on the Share Swap Record Date.
6.1.4. IBF Financial Holdings’ board of directors has approved to issue IBF Financial Holdings Preferred Shares to pay the Share Consideration.
6.1.5. The relevant permissions, consents, approvals from or effective registrations with the competent authorities required for the Matter have been obtained, including but not limited to, approval by the FSC according to Article 26 of the Financial Holding Company Act, the effective registration of issuance of IBF Financial Holdings Preferred Shares with the FSC (if applicable), the letter of consent from TWSE permitting the listing of IBF Financial Holdings Preferred Shares on the Share Swap Record Date, the letter from the Investment Commission of the Ministry of Economic Affairs permitting Entie Banks’s foreign shareholders, who previously have obtained the investment approval from such commission, to transfer their own Entie Bank’s shares and to obtain IBF Financial Holdings Preferred Shares through the Share Swap (if applicable), completion of the filing of transfer of shares by the shareholders holding more than 10% of Entie Bank’s total shares according to Article 22-2 of the Securities and Exchange Act (if applicable), and a letter of consent from TWSE allowing the delisting of Entie Bank on the Share Swap Record Date (collectively, “Regulatory Approval(s)”).
6.1.6. The completion of the Matter is not restricted or prohibited accoridng to temporary or permanent injunction or other orders issued by a court of competent jurisdiction or according to other laws.
6.1.7. The completion of the Matter is not materially restricted or prohibited by any currently effective laws, regulations or rules issued, prescribed, announced or executed by any competent authority.
6.2. The obligations of IBF Financial Holdings to complete this Matter are subject to the

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

following conditions precedent (or, as a condition precedent may be waived according to its nature and IBF Financial Holdings has given consent to waive such condition precedent):

6.2.1. The representations and warranties of Entie Bank set forth in the Agreement shall be true and correct in all material respects as of the Signing Date and the Share Swap Record Date. The foregoing shall be confirmed by a certificate issued by the authorized representative of Entie Bank on the Share Swap Record Date.
6.2.2. Entie Bank shall have performed in all material respects all the covenants and obligations that are required to be performed prior to the Share Swap Record Date pursuant to the Agreement.
6.2.3. All third party consents to the Matter required by the laws or contracts to be obtained by Entie Bank shall have been obtained by Entie Bank.
6.2.4. From the Signing Date to the Share Swap Record Date, no event has occurred to Entie Bank (including material punishments, sanctions or others imposed by the competent authorities) that may result in a material adverse effect on its business, financial conditions, properties, operations and shareholders’ equity; for evaluating the Material Adverse Effect as provided in this Article, it may refer to the relevant provisions in Articles 4.4 and 7.3.
6.2.5. From the Signing Date to the Share Swap Record Date, Entie Bank shall not have sought financing from the Central Bank or other financial institutions due to a rapid loss of the deposits it has received, nor do the competent authorities assign institutions or officials to take over, supervise or assist Entie Bank.
6.3. The obligations of Entie Bank to complete this Matter are subject to the following conditions precedent (or, as a condition precedent may be waived according to its nature and Entie Bank has given consent to waive such condition precedent):
6.3.1. The representations and warranties of IBF Financial Holdings set forth in the Agreement shall be true and correct in all material respects as of the Signing Date and the Share Swap Record Date. The foregoing shall be confirmed by a certificate issued by the authorized representative of IBF Financial Holdings on the Share Swap Record Date.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

6.3.2. IBF Financial Holdings shall have performed in all material respects all the covenants and obligations that are required to be performed prior to the Share Swap Record Date pursuant to the Agreement.
6.3.3. Besides the Rakuten Consent, all the other third parties’ consents required by the laws or contracts to be obtained by IBF Financial Holdings shall have been obtained by IBF Financial Holdings.
6.3.4. From the Signing Date to the Share Swap Record Date, no event has occurred to IBF Financial Holdings (including material punishments, sanctions or others imposed by the competent authorities) that may result in a Material Adverse Effect on its business, financial condition, properties, operation and the interests of the shareholders; for evaluating the material adverse effect as provided in this Article, it may refer to the relevant provisions in Articles 4.4 and 7.3.
6.4. The completion of this Matter is subject to the satisfaction or waiver (excluding any condition precedent that may not be waived according to its nature; for the avoidance of doubt, the Rakuten Consent shall be waived only by the consent of both Parties) of all conditions precedent listed in Articles 6.1 to 6.3 on or before October 13, 2022, or a later date agreed upon by both Parties in writing (the “Final Transaction Date”). Unless the conditions precedent listed in Article 6.1 to Article 6.3 of the Agreement are not satisfied or waived (excluding the condition precedent that may not be waived according to its nature) on or before the Final Transaction Date, either Party shall not hinder the completion of this Matter for any other reasons.

Article 7 Representations and Warranties

7.1. IBF Financial Holdings hereby represents and warrants to Entie Bank that, except those publicly disclosed pursuant to laws, disclosed on IBF Financial Holdings’ audited financial statements dated as of June 30, 2021, or disclosed in writing (including but not limited to, in the form of any electromagnetic records or emails) by the directors, managers, mandatories or agents of IBF Financial Holdings to Entie Bank prior to the Signing Date (including but not limited to, those disclosed in the virtual data room during the course of due diligence), to IBF Financial Holdings’ knowledge (however, this means to IBF Financial Holdings and its Major Subsidiaries’ knowledge when Article 7.1.6 of the Agreement applies), the following matters are true and correct on the Signing Date and the Share Swap Record Date:

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

7.1.1. The company’s legal establishment and existence: IBF Financial Holdings is a financial holding company registered and legally existing according to the Company Act of the Republic of China; IBF Financial Holdings and its Major Subsidiaries have all necessary capacity and authority to operate their business and have obtained all the necessary licenses, approvals, permissions and other licenses to engage in their business. IBF Financial Holdings’ issued shares are all legally authorized and issued, and the capital stock for the shares have been fully paid. The “Major Subsidiaries” as provided in the Agreement means International Bills Finance Corporation (“IBFC”), IBF Securities Co., Ltd., and IBF Venture Capital Co., Ltd.
7.1.2. Legal compliance: IBF Financial Holdings and its Major Subsidiaries have no material violations of laws and regulations, court judgements, orders or sanctions of the competent authorities, or the Articles of Incorporations and internal regulations (including but not limited to, the Company Act, Financial Holding Company Act, labor laws, tax laws or other relevant laws and regulations, or their regulations of internal audit and internal control) that have a Material Adverse Effect or affect IBF Financial Holdings’ ability to perform the obligations under the Agreement; nor have they been punished or sanctioned by the competent authorities due to any violation of laws and regulations which have a Material Adverse Effect on IBF Financial Holdings or its Major Subsidiaries.
7.1.3. Legality and validity of the Agreement: For the execution and performance of the Agreement, IBF Financial Holdings (1) does not violate current laws and regulations of the Republic of China; (2) does not violate the judgment, order or sanctions of the court or relevant competent authorities; (3) does not violate its Articles of Incorporation, internal regulations and/or rules, the resolutions by its board of directors or shareholders’ meetings; (4) does not violate any legally binding contracts, agreements, declarations, commitments, warranties, guarantees, promises or other obligations and such violation will affect the ability of IBF Financial Holdings to perform the Agreement; and (5) except for the Regulatory Approvals and the Rakuten Consent, there is no need to obtain any approval or consent from any competent authority or third party according to contracts or relevant laws. The execution and performance of the Agreement shall be based on IBF Financial Holdings’ legitimate and effective resolution and authorization. The Agreement constitutes a legitimate and legally binding obligation to IBF Financial Holdings. The terms in the Agreement are enforceable to IBF Financial Holdings.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

7.1.4. Financial statements and financial data: The financial statements provided to Entie Bank are prepared in accordance with applicable accounting principles and all important matters relating to IBF Financial Holdings have been fairly presented. The content does not contain any false statement, significant error or concealment. In addition to those disclosed to Entie Bank in writing, IBF Financial Holdings and its Major Subsidiaries have no significant liabilities such as direct, indirect or contingent liabilities that should have been disclosed in IBF Financial Holdings’ consolidated financial statements according to applicable accounting principles but were not shown in such statements or their notes.
7.1.5. No additional material debt: Except as necessary for ordinary business operation, since the audited financial statements dated as of June 30, 2021, IBF Financial Holdings and its Major Subsidiaries have not had any additional debts, duties, obligations or contingent liabilities; except that (1) each of such debt, duty, obligation or contingent liability’s amount is less than NT$[100,000,000]; or (2) such debts, duties, obligations or contingent liabilities does not have any Material Adverse Effect or are reasonably expected to have no Material Adverse Effect on IBF Financial Holdings and/or its Major Subsidiaries; or (3) such debts, duties, obligations or contingent liabilities arise from IBF Financial Holdings’ obligations of the buyback of its Dissenting Shares.
7.1.6. Dispute Events and investigation: IBF Financial Holdings and its Major Subsidiaries have no (1) ongoing or obviously possible litigation, non-contentious matter, dispute (collectively, “Dispute Events”) or investigation of which the results may lead to the dissolution, significant changes to its/their organization or capital, suspension of operations of IBF Financial Holdings and/or its Major Subsidiaries or restrictions or prohibitions on IBF Financial Holdings to perform the obligations under the Agreement; or (2) single Dispute Event or investigation (i) concerns an amount over NT$100,000,000, or (ii) has any Material Adverse Effect on IBF Financial Holdings and/or its Major Subsidiaries, except to the extent that such Dispute Event or investigation occurs after the Signing Date and IBF Financial Holdings has informed Entie Bank within 5 business days after it learns of such Dispute Event or investigation.
7.1.7. Capital composition: The composition of IBF Financial Holdings’ capital is as stated in Article 2.1 of the Agreement. IBF Financial Holdings and its Major Subsidiaries have no outstanding securities, warrants or stock options that may be

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

converted to or exchangeable for the equity interest of IBF Financial Holdings, nor have they granted other person rights to subscribe its shares or other equity-type securities. Unless otherwise provided in Article 9 of the Agreement, IBF Financial Holdings and its Major Subsidiaries have no obligations to buyback, redeem, purchase or acquire any shares of IBF Financial Holdings, securities with voting rights of IBF Financial Holdings, or any securities which may be converted to or exchangeable for shares of IBF Financial Holdings.
7.1.8. Independent judgement: Prior to the Signing Date, IBF Financial Holdings has conducted independent investigation and analysis. IBF Financial Holdings has considered the result of such independent investigation and analysis, the relevant terms and conditions of the Agreement and the representations and warranties made by Entie Bank in Article 7.2 of the Agreement, as the basis of its decision.
7.1.9. The Share Swap: IBF Financial Holdings does not receive any legal actions or procedures that may result in prohibiting or restricting IBF Financial Holdings from performing the obligations under the Agreement.
7.1.10. Tax return filing and payment: All tax returns that should be filed by IBF Financial Holdings and its Major Subsidiaries according to the laws have all been filed truthfully and within the statutory deadline, and all the taxes have been fully paid within the deadline for payment. There is no delayed filing, non-filing, underreporting, tax evasion or other actions that violate relevant tax laws, orders, or administrative interpretations that have a Material Adverse Effect on IBF Financial Holdings.
7.1.11. Assets and Liabilities: The assets in use and liabilities of IBF Financial Holdings and its Major Subsidiaries for their business operations have already been clearly listed in the financial statements provided to Entie Bank, and IBF Financial Holdings and its Major Subsidiaries have legitimate rights of the assets in use, except to the extent that the absence of legitimate rights of such assets in use has (or are reasonably expected to have) no Material Adverse Effect on IBF Financial Holdings and its Major Subsidiaries.
7.1.12. Intellectual Property: IBF Financial Holdings and its Major Subsidiaries own the legitimate trademarks for their business use, and own the legitimate ownership and rights to use the intellectual property and computer software necessary for their

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

  - business operations, except to the extent that the absence of legitimate rights of such intellectual property and computer software has (or are reasonably expected to has) no Material Adverse Effect on IBF Financial Holdings and its Major Subsidiaries. IBF Financial Holdings and its Major Subsidiaries have no infringements on any others’ trademarks or intellectual property, nor have they been informed of infringements of others’ trademarks or intellectual property, which have a Material Adverse Effect on IBF Financial Holdings and its Major Subsidiaries.

7.1.13. Labor-management relations: IBF Financial Holdings and its Major Subsidiaries have no material labor disputes or sanctions by the relevant labor authorities due to violations of labor laws, which have a Material Adverse Effect on IBF Financial Holdings and/or its Major Subsidiaries.
7.1.14. No breach of contract: IBF Financial Holdings and its Major Subsidiaries’ have no breach of contract on any fiduciary contract, mortgage contract, trust deed, loan agreement or other contracts of which they are the involved party, or bonded, or their property is the subject of such contract, which has a Material Adverse Effect on IBF Financial Holdings and its Major Subsidiaries and may result in affecting IBF Financial Holdings’ performance of the obligations under the Agreement.
7.1.15. Information related to the Agreement: The documents and information related to the Agreement provided by IBF Financial Holdings to Entie Bank are true and, in all material respects correct, without false statements or critical concealments.
7.2. Entie Bank hereby represents and warrants to IBF Financial Holdings that, except those publicly disclosed pursuant to laws, disclosed on Entie Bank’s audited financial statements dated as of June 30, 2021, or disclosed in writing (including but not limited to, in the form of any electromagnetic records or emails) by the directors, managers, mandatories or agents of Entie Bank to IBF Financial Holdings prior to the Signing Date (including but not limited to, those disclosed in the virtual data room during the course of due diligence), to Entie Bank’s knowledge, the following matters are true and correct on the Signing Date and the Share Swap Record Date:
7.2.1. The company’s legal establishment and existence: Entie Bank is a commercial bank registered and legally existing according to the Company Act of the Republic of China, having all necessary capacity and authority to operate its business and has

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

obtained all the necessary licenses, approvals, permissions and other licenses to engage in its business. Entie Bank’s issued shares are all legally authorized and issued, and the capital stock for the shares have been fully paid.

7.2.2. Legal compliance: Entie Bank has no material violations of laws and regulations, court judgements, orders or sanctions of the competent authorities, or the Articles of Incorporations and internal regulations (including but not limited to, the Company Act, Banking Act, labor laws, tax laws or other relevant laws and regulations, or its regulations of internal audit and internal control) that have a Material Adverse Effect or affect Entie Bank’s ability to perform the obligations under the Agreement; nor has it been punished or sanctioned by the competent authorities due to violation of laws and regulations which has a Material Adverse Effect.
7.2.3. Legality and validity of the Agreement: For the execution and performance of the Agreement, Entie Bank (1) does not violate current laws and regulations of the Republic of China; (2) does not violate the judgment, order or sanctions of the court or relevant competent authorities; (3) does not violate its Articles of Incorporation, internal regulations and/or rules, the resolutions by its board of directors or shareholders’ meetings; (4) does not violate any legally binding contracts, agreements, declarations, commitments, warranties, guarantees, promises or other obligations and such violation will affect the ability of Entie Bank to perform the Agreement; and (5) except for the Regulatory Approvals, there is no need to obtain any approval or consent from any competent authority or third party according to contracts or relevant laws. The execution and performance of the Agreement shall be based on Entie Bank’s legitimate and effective resolution and authorization. The Agreement constitutes a legitimate and legally binding obligation to Entie Bank. The terms in the Agreement are enforceable to Entie Bank.
7.2.4. Financial statements and financial data: The financial statements provided to IBF Financial Holdings are prepared in accordance with applicable accounting principles and all important matters relating to Entie Bank have been fairly presented. The content does not contain any false statement, significant error or concealment. In addition to those disclosed to IBF Financial Holdings in writing, Entie Bank has no significant liabilities such as direct, indirect or contingent liabilities that should have been disclosed in Entie Bank’s consolidated financial statements according to applicable accounting principles but were not shown in

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

such statements or their notes.

7.2.5. Internal audit and internal control: Entie Bank has organized, set up and maintained internal control systems and related personnel in accordance with relevant laws and regulations (including but not limited to the three lines of internal control such as self-checking system, legal compliance system and risk management mechanism and internal audit system etc.).
7.2.6. No additional material debt: Except as necessary for ordinary business operation, since the audited financial statements dated as of June 30, 2021, Entie Bank has not had any additional debts, duties, obligations or contingent liabilities; however, except that (i) each of such debt, duty, obligation or contingent liability’s amount is less than NT$[100,000,000] (2) such debts, duties, obligations or contingent liabilities does not have any Material Adverse Effect or are reasonably expected to have no Material Adverse Effect on Entie Bank.
7.2.7. Dispute Events and investigation: Entie Bank has no ongoing or obviously possible (1) Dispute Events or investigation of which the results may lead to the dissolution, significant changes to its organization, capital, suspension of operations of the company or restrictions or prohibitions on Entie Bank to perform the obligations under the Agreement; or (2) single Dispute Event or investigation (i) concerns an amount over NT$100,000,000, or (ii) has any Material Adverse Effect on Entie Bank, except to the extent that such Dispute Event or investigation occurs after the Signing Date and Entie Bank has informed IBF Financial Holdings within 5 business days after it learns of such dispute event or investigation process.
7.2.8. Employee: Except for the outstanding 9,110,000 units of equity linked certificates issued pursuant to its Virtual Stock Plan Implementation Guidelines (whether vested or unvested; the actual amount paid to employees for the sale of shares is calculated on the basis of 4,076,000 units; the “Employee Equity Linked Certificates”), Entie Bank does not make any commitment of any golden parachute or similar terms to its employees, nor has it provided Preferential Treatments (defined as below) which are not in accordance with commercial custom to its employees or managers; except to the extent that those required by laws and regulations or the existing internal regulations of Entie Bank, or with IBF Finanical Holdings’ written consent. The implementation of this Matter will not result in claims of any payment or benefit due to any change of control or early termination

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

or rescission of employment or appointment contracts by any employee or manager of Entie Bank (including but not limited to the implementation of employee retirement preference and/or severance plans, group agreements that are better than labor-related laws and regulations, or other measures or programs with similar nature that address employee rights and benefits; collectively, the “Preferential Treatments”); except that such Preferential Treatments are in accordance with relevant laws and regulations, required by the competent authorities, or with written consent by IBF Financial Holdings.
7.2.9. Material transactions or contracts: From the audited financial statements dated June 30, 2021 to the Signing Date, Entie Bank did not enter into material transactions or contracts with an amount exceeding NT$100,000,000 except for those necessary for the ordinary operations.
7.2.10. Capital composition: The composition of Entie Bank’s capital is as stated in Article 2.2 of the Agreement. Entie Bank has no outstanding securities, warrants or stock options that may be converted to or exchangeable for the equity interest of Entie Bank, nor has it granted other person rights to subscribe its shares or other equitytype securities. Unless otherwise provided in Article 9 of the Agreement, Entie Bank has no obligations to buyback, redeem, purchase or acquire any shares of Entie Bank, securities with voting rights of Entie Bank, or any securities which may be converted to or exchangeable for shares of Entie Bank.
7.2.11. Insurance: Entie Bank has purchased insurance from qualified insurance agents and/or insurance companies in accordance with relevant laws and regulations and contracts, including but not limited to the general liability insurance for the banking industry and the liability insurance for directors, supervisors and managers. There is no insured event that should be reported by Entie Bank in accordance with the “Scope and Application Procedures and Other Compliance Matters of Major Contingencies Notified by Financial Institutions”.
7.2.12. Independent judgement: Prior to the Signing Date, Entie Bank has conducted independent investigation and analysis. Entie Bank has considered the result of such independent investigation and analysis, the relevant terms and conditions of the Agreement and the representations and warranties made by IBF Financial Holdings in Article 7.1 of the Agreement, as the basis of its decision.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

7.2.13. The Share Swap: Entie Bank does not receive any legal actions or procedures that prohibit or restrict Entie Bank from performing the obligations under the Agreement.
7.2.14. Tax return filing and payment: All tax returns that should be filed by Entie Bank according to the laws have all been filed truthfully and within the statutory deadline, and all the taxes have been fully paid within the deadline for payment. There is no delayed filing, non-filing, under-reporting, tax evasion or other actions that violate relevant tax laws, orders, or administrative interpretations that have a Material Adverse Effect on Entie Bank, except to the extent that withholding taxes or filing taxes on behalf of its customers by Entie Bank in the course of its ordinary business operations may not fully comply with the laws and regulations
7.2.15. Assets and Liabilities: The assets in use and liabilities of Entie Bank for its business operations have already been clearly listed in the financial statements provided to IBF Financial Holdings, and Entie Bank has legitimate rights of the assets in use, except to the extent that the absence of legitimate rights of such assets in use has no (or are reasonably expected to have) no Material Adverse Effect on Entie Bank.
7.2.16. Intellectual Property: Entie Bank owns the legitimate trademarks for its business use, and owns the legitimate ownership and rights to use the intellectual property and computer software necessary for its business operation, except to the extent that the absence of legitimate rights of such intellectual property and computer software has (or are reasonably expected to has) no Material Adverse Effect on Entie Bank. Entie Bank has no infringements on any others’ trademarks or intellectual property, nor has it been informed of infringements of others’ trademarks or intellectual property, which have a Material Adverse Effect on Entie Bank.
7.2.17. Labor-management relations: Entie Bank has no material labor disputes or sanctions by the relevant labor authorities due to violations of labor laws, which have a Material Adverse Effect on Entie Bank.
7.2.18. No breach of contract: Entie Bank has no breach of contract on any fiduciary contract, mortgage contract, trust deed, loan agreement or other contract of which it is the involved party, or bonded, or its property is the subject of such contract,

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

which has a Material Adverse Effect on Entie Bank and may affect Entie Bank’s performance of the obligations of the Agreement.

7.2.19. Information related to the Agreement: The documents and information related to the Agreement provided by Entie Bank to IBF Financial Holdings are true and, in all material respects correct, without false statements or critical concealments.
7.3. The “Material Adverse Effect” as provided in Article 7 of the Agreement means the occurrence of the event as provided in Articles 7.1 or 7.2 hereof which, individually or in total, cause or are reasonably expected to cause the net value of either Party to cumulatively decrease by more than 10% compared with the net value of the audited consolidated financial statements dated June 30, 2021. In estimating the losses incurred from the said event, the unrealized losses on valuation of financial assets measured at fair value through other comprehensive income shall be excluded. If any Party has obtained a prior written consent from the other Party according to Article 8 of the Agreement and the abovementioned event occurs, such event shall not be deemed to have a Material Adverse Effect.

Article 8 Covenants

8.1. IBF Financial Holdings covenants to Entie Bank not to take the following actions during the period from the Signing Date to the Share Swap Record Date without prior written consent of Entie Bank (however, Entie Bank shall not unreasonably withhold or delay in granting its consent):
8.1.1. Capital increase, issuance of new shares, issuance of employee stock warrants, convertible corporate bonds, corporate bonds with warrants, preferred shares with warrants, depositary receipts, stock warrants or other equity-type securities unless otherwise provided in the Agreement or this Matter, or as necessary for ordinary business operations.
8.1.2. Except as necessary for ordinary business operations, IBF Financial Holdings or IBFC acquires or disposes of any asset with value exceeding NT$100,000,000 (excluding the renewal or extension of a lease, license, mortgage or pledge of an asset that has occurred as of the Signing Date), or incurs any liability, duty, obligation or contingent liability amounting to NT$100,000,000 or more. For the purpose of calculating foregoing amount shall include the amount of a single

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

transaction or the total amount of multiple homogeneous or related transactions for the same business purpose; in the case of multiple homogeneous or related transactions for the same business purpose, IBF Financial Holdings shall obtain prior written consent from Entie Bank if the single transaction to be executed by IBF Financial Holdings (or by IBFC, upon IBF Financial Holdings’ knowledge) cumulatively with other executed transactions will reach NT$100,000,000.

8.1.3. Except as in accordance with laws and regulations and the buyback of the IBF Financial Holdings Dissenting Shares, direct or indirect buyback of shares or equity securities already issued by itself or through a third party, reduction in capital, adoption of a resolution of dissolution, liquidation, applying for reorganization, execution of a settlement agreement or applying for bankruptcy.
8.1.4. Negotiation for or execution by IBF Financial Holdings and its Major Subsidiaries with any third party for the following: (1) a merger or share swap agreement; (2) entering into, amendment or termination of a contract that leases the whole business to others, delegates the management to others, or operates jointly with others on a regular basis; (3) a contract which assigns the whole or essential part of the business or property to others; (4) a contract which assumes the whole business or property from others and concerns a value exceeding NT$300,000,000; or (5) any contract, agreement, promise, letter of intent or memorandum of a transaction having similar effects as (1) to (4) above.
8.1.5. Except as necessary for ordinary business operations, waiving, renouncing or relinquishing any of its rights or failing to exercise any of its validly existing rights or benefits involving more than NT$50,000,000 by IBF Financial Holdings and its Major Subsidiaries, or entering into any settlement with any third party regarding the Dispute Events involving more than NT$50,000,000.
8.1.6. By IBF Financial Holdings and IBFC issuing equity linked certificates, increasing payrolls, benefits or other interests of their employees (including directors, supervisors, officers and advisors employed by the companies) or unduly employing a massive amount of employees, except to the extent that the annual promotions and salary adjustments for their employees are in accordance with the existing employee promotion and salary adjustment system or the existing practice.
8.1.7. (1) Any action or inaction taken by IBF Financial Holdings and its Major

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Subsidiaries reasonably expected to make the representations and warranties applicable under Article 7 of the Agreement untrue or inaccurate; (2) any action or inaction taken by IBF Financial Holdings and IBFC reasonably expected to cause substantial or essential changes to their business, or make the Condition Precedents set forth in Article 6 of the Agreement difficult or unable to be fulfilled.

8.2. IBF Financial Holdings undertakes that IBF Financial Holdings shall comply with the following matters from the Signing Date to the Share Swap Record Date:
8.2.1. Use its commercially reasonable efforts to maintain ordinary operations and customary operation practices, and operate its business with due care of good management.
8.2.2. If any of the following events occurs or is expected to occur to IBF Financial Holdings and its Major Subsidiaries (as applicable under the below Paragraph (1)), to the extent permitted by the relevant laws, regulations or orders, IBF Financial Holdings shall notify Entie Bank in writing within 5 business days, provide relevant information as reasonably requested by Entie Bank and conduct an assessment of the Transaction Consideration Adjustment in accordance with Articles 4.2 and/or 4.3 of the Agreement (if applicable):
- (1) IBF Financial Holdings and/or its Major Subsidiaries breach any of representations or warranties made under the Agreement, or fail to perform their covenants made under the Agreement;
- (2) Except as necessary for ordinary business operations, IBF Financial Holdings and IBFC enter into any contract with an amount or value exceeding NT$50,000,000 or enter into any material commitment with any third part, which would reasonably be expected to have a Material Adverse Effect on it; and
- (3) Occurrence of events to IBF Financial Holdings that the Transaction Consideration Adjustment as set forth in Article 4 of this Agreement may apply.
8.2.3. All statutory procedures applied to this Matter shall be processed in good faith and expeditiously, including but not limited to the approval for the Matter by the FSC,

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

the effective registration of the issue of new shares for this Matter and any approval from other competent authorities.

8.3. IBF Financial Holdings covenants, after the completion of the Matter, to the extent permitted by law, to release any personnel who served as Entie Bank’s directors or were appointed by Entie Bank’s board of directors to perform their relevant duties at any time during the period commencing on July 1, 2012 and ending on the Share Swap Record Date ( “Entie Bank Management“) from any liability incurred or likely to be incurred by Entie Bank Management for actions, suits, merit of claims, claims, losses, demands, damages, and costs and expenses of any kind arising out of the performance of their duties. IBF Finanical Holdings shall, following the Share Swap Record Date and to the extent permitted by laws, assist Entie Bank in determining whether to hold harmless Entie Bank Management from and against the liabilities incurred from the aforesaid circumstances. However, this Article shall not apply to the liability of any of the aforementioned legal or natural persons arising from intentional or gross negligence or breach of their duty of care obligations under relevant laws and regulations that shall be complied with due to their positions and responsibilities or administrative sanctions imposed by competent authorities that are binding to them, or liability arising from conviction for a Felony (as defined below) and the right to claim compensation arising from the circumstances of such criminal offenses. “Felony” in this Article means a crime with criminal intent and a sentence of two years or more (including two years) of imprisonment. For the avoidance of doubt, if the application of the statute, rule, law or order of the Republic of China results in a reduction of the sentence pronounced (e.g., if the court informs both the pronounced sentence and reduced sentence in the main text of the judgment while ruling, and the pronounced sentence is thus reduced), the reduced sentence shall prevail, i.e., if the reduced sentence is still a sentence of two years or more (including two years), then the crime is a Felony under this Article.
8.4. IBF Financial Holdings covenants to insure the directors and managers of Entie Bank with directors’ and managers’ liability insurance in accordance with general custom after the Share Swap Record Date; the terms of such liability insurance shall be in accordance with general custom and the period of insurance shall be effective from the Share Swap Record Date.
8.5. Entie Bank covenants not to take the following actions during the period from the Execution Date through the Swap Record Date without prior written consent by IBF Financial Holdings in writing (however, IBF Financial Holdings shall not unreasonably

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

withhold or delay in granting its consent):

8.5.1. Capital increase, issuance of new shares, issuance of employee stock warrants, convertible corporate bonds, corporate bonds with warrants, preferred shares with warrants, depositary receipts, stock warrants or other equity-type securities other than provided in the Agreement.
8.5.2. Change of the credit authorization level or important credit policy, except for those changes due to changes in laws and regulations (including but not limited to the self-regulatory regulations issued by bank association to which Entie Bank belongs) or changes made in accordance with the requirements by the competent authorities.
8.5.3. Revaluation of assets, change of certified accountants, change of policies, practices, principles or evaluation methods related to accounting or liability reserves, unless such change is necessary due to changes in laws and regulations or in generally accepted accounting principles.
8.5.4. Except as necessary for ordinary business operations, acquisition or disposal of any assets with value exceeding NT$100,000,000 (excluding the renewal or extension of leases, licenses, mortgages or pledges of assets that has occurred as of the Signing Date), or any new liabilities, duties, obligations or contingent liabilities with an amount of NT$100,000,000 or more. For the purpose of calculating foregoing amount shall include the amount of a single transaction or the total amount of multiple homogeneous or related transactions for the same business purpose; in the case of multiple homogeneous or related transactions for the same business purpose, Entie Bank shall obtain prior written consent from IBF Financial Holdings if the single transaction to be executed by Entie Bank cumulatively with other executed transactions will reach NT$100,000,000. For the avoidance of doubt, both Parties hereby confirm that the leased premises (including but not limited to office space) are necessary for ordinary business operations.
8.5.5. Except in accordance with laws and regulations and the buyback of the Entie Bank Dissenting Shares, direct or indirect buyback of shares or equity securities already issued by itself or through a third party.
8.5.6. Abolishing existing branches or ceasing or terminating its operation, or undergoing capital reduction, resolution of dissolution, liquidation, application for

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

reorganization, settlement or bankruptcy.

8.5.7. Negotiation for or execution of any of the following matters with any third party: (1) a merger or share swap agreement; (2) entering into, amendment or termination of a contract that leases the whole business to others, delegates the management to others or operates jointly with others on a regular basis; (3) a contract which assigns the whole or essential part of the business or property to others; (4) a contract which assumes the whole business or property from others; or (5) any contract, agreement, promise, letter of intent or memorandum of a transaction having similar effects as (1) to (4) above.
8.5.8. Except as necessary for ordinary business operation, waiving, renouncing or relinquishing any of its rights or failing to exercise any of its validly existing rights or benefits involving more than NT$50,000,000, or entering into any settlement with any third party regarding the Dispute Events involving more than NT$50,000,000. However, the settlement of disputes arising from the sale of complex high-risk derivative financial instruments such as TRF (Target Redemption Forward) and DKO (Discrete Knock-Out Forward) (including cases in which bad debts have been written off) or the assignment or other disposition of bad debts in accordance with this Agreement shall be excluded.
8.5.9. Transfer or other disposal of bad debt with a single credit (for the avoidance of doubt, as defined in Article 33-3 of the Banking Act and the Regulations Governing the Authorization of Matters under Article 33-3 of the Banking Act, credit extended to the same person, the same related party or the same related enterprise shall be considered as a single credit case, hereinafter the same) whose principal amounts to NT$300,000,000 or more.
8.5.10. Except as necessary for ordinary business operations, entering into any contract excessing NT$50,000,000 in amount or value.
8.5.11. Issuing price linked certificates, increasing payrolls, benefits or other interests of its employees (including directors, officers and advisors employed by the company), propose or implement preferential retirement or severance plans, or unduly dismissing or employing a massive amount of employees, except to the extent that those are in accordance with laws and regulations or existing internal regulations of Entie Bank (including but not limited to established personnel system

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

or policies of Entie Bank such as employee promotion and salary adjustment system) and practical custom.

8.5.12. Any action or inaction reasonably expected to make (1) the representations and warranties under Article 7 of this Agreement untrue or inaccurate; (2) significant or essential changes to its business; or (3) the Condition Precedents set forth in Article 6 of this Agreement difficult or unable to be fulfilled.
8.6. Entie Bank undertakes that Entie Bank shall comply with the following matters from the Signing Date to the Share Swap Record Date:
8.6.1. Use its commercially reasonable efforts to maintain ordinary operation and customary operating practices, to operate its business with due care of good management, to comply with the provisions of laws and regulations, ruling, orders or disposition of courts or relevant competent authorities, comply with contracts to which Entie Bank is a party in material respects, and to maintain its existing business organization and branch offices.
8.6.2. If any of the following events occurs or is expected to occur to Entie Bank, to the extent permitted by the relevant laws, regulations or orders, Entie Bank shall notify IBF Financial Holdings in writing within 5 business days, provide relevant information as reasonably requested by IBF Financial Holdings and conduct an assessment of the Transaction Consideration Adjustment in accordance with Articles 4.2 and/or 4.3 of this Agreement (if applicable):
- (1) The single credit asset is overdue (for avoidance of doubt, it means the due but unrepaid debt as defined in such credit agreement) or the balance due to accelerated maturity is more than NT$300,000,000;
- (2) Write-off of bad debts with principal of more than NT$300,000,000 in a single credit case;
- (3) Breach of any representation or warranty made by it under the Agreement, or failure to perform any of its covenants under the Agreement;
- (4) Occurrence of the matters that the Transaction Consideration Adjustment as set forth in Article 4 of this Agreement may apply; and

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

  - (5) When other major contingency occurs that should be reported by Entie Bank in accordance with the “Scope and Application Procedures and Other Compliance Matters of Major Contingencies Notified by Financial Institutions”, Entie Bank shall immediately notify IBF Financial Holdings in addition to reporting to the competent authorities.

8.6.3. Complete all statutory procedures of this Matter shall be processed in good faith and expeditiously, including but not limited to the consent letter from TWSE to delist Entie Bank on Share Swap Record Date and approval from other competent authorities.
8.6.4. Labor leave and holidays shall be provided in accordance with relevant laws and regulations and the existing customary practices of Entie Bank at the time of the Signing Date.
8.6.5. Procure its shareholders in good faith to apply with Investment Commission of the Ministry of Economic Affairs for approval to dispose their shareholdings in Entie Bank through this Share Swap and to obtain the IBF Financial Holdings Preferred Shares (if applicable) as soon as possible.
8.6.6. At least monthly, provide IBF Financial Holdings with relevant financial information (including audited or reviewed financial statements as of Share Swap Record Date and other unaudited or reviewed interim self-statements) and risk management reports, including at least the important credit resolutions of Entie Bank and the status and progress of specific credit cases as requested by IBF Financial Holdings.
8.7. Both Parties agree to jointly negotiate the implementation details of the transition working group in good faith and expeditiously after the Signing Date (including but not limited to, the transition working group shall consist of respectively five representatives of each Party, the meeting schedule and methods of discussions and resolutions) in order to enable both Parties to establish the transition working group immediately after the approval of their extraordinary shareholders’ meetings to discuss matters relating to the operation, investment management, manpower planning, exchange of information, and performance of this Matter or this Agreement by the Parties..
8.8. Either Party who intends to publish, disclose or announce any information in respect of

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

this Agreement or the Share Swap shall obtain the prior written consent of the other Party (which shall not be unreasonably withheld or delayed); however, (1) such publication may be made in accordance with the requirements of the applicable laws and regulations or the TWSE, and the Party has used its commercially reasonable efforts to confirm the correctness of such information with the other Party prior to the publishment, disclosure or announcement of such information; and (2) the information disclosed or announced by Entie Bank for the purpose of explaining to its employees the protection of the rights and interests of its employees in connection with this Matter are not subject to this limitation.

Article 9 Handling of Dissenting Shares

If any of the shareholders of either Party objects to the Matter and requests such Party for buyback of its shares pursuant to law (the “Dissenting Shareholders”), such Party shall buy back the shares held by such dissenting shareholders pursuant to relevant laws and regulations. The shares bought back under this Article shall follow relevant laws and regulations to be sold or eliminated.

Article 10 Directors and Independent Directors of Entie Bank

The directors and independent directors of Entie Bank whose terms have not expired on the Share Swap Record Date shall not continue to serve their terms. On Share Swap Record Date, the directors and independent directors of Entie Bank shall be appointed by IBF Financial Holdings in accordance with the laws and regulations.

Article 11 Protection of Rights and Interests of Employees of Entie Bank

IBF Financial Holdings covenants to, after the Share Swap Record Date, comply with the Labor Standards Act and other relevant laws to ensure the labor conditions and rights of all employees of Entie Bank who remain in employment after the Share Swap Record Date (including managers, the “Retained Employees”), and to establish reasonable employee retention incentives or programs for the Retained Employees. Within the 36 months period after the Share Swap Record Date, except for material violations of Entie Bank personnel rules by Entie Bank employees for reasons attributable to themselves, IBF Financial Holdings shall protect the working rights of Entie Bank employees and shall not adversely change positions and labor conditions (including but not limited to the labor contracts, personnel rules, group agreements, salaries and benefits and others) of Entie Bank employees.

Article 12 Events of Default

12.1 In the event of any failure to perform or breach of any obligations, covenants, representations or warrants under this Agreement by a Party, where such non-performance or breach is curable in nature, it constitutes an event of default of this Agreement if the defaulting Party, upon receipt of written notice from the non-defaulting Party to cure within a reasonable period of 30 or less business days, fails to cure such non-performance or breach within the cure period set forth in such notice.
12.2 In case where an event of default occurs, in addition to the rights, remedies, clams for damages and termination or rescission hereof that the non-defaulting Party may seek as permitted by laws, the non-defaulting Party may claim the necessary fees and expenses arising from or in connection with the preparation of this Agreement and the performance of the transaction contemplated by this Agreement against the defaulting Party.

Article 13 Termination

13.1.This Agreement may be terminated prior to the Share Swap Record Date as follows:
13.1.1 By mutual consent of the Parties in writing.
13.1.2 By the Party Entitled of Adjustment, in accordance with Article 4.3 of this Agreement.
13.1.3 By the non-defaulting Party through giving written notice to the defaulting party, if breach or non-performance by a Party (1) will prevent the Condition Precedents set forth in Article 6 of the Agreement from being satisfied or from completing prior to and including the Final Transaction Date; and (2) is not waived by the nondefaulting Party.
13.1.4 By either Party in writing, if this Matter is prohibited by statute, court decision, ruling or order issued by a competent authority or by administrative disposition, and such prohibition or restriction is definitive and cannot be rectified by adjustment of the contents of this Agreement.
13.1.5 By either Party in writing, if this Matter and this Agreement are not approved by the resolution of the shareholders’ meeting of either Party, either Party may

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

terminate this Agreement in writing.

13.1.6 The Agreement shall be automatically terminated if this Matter is not completed on or before the Final Transaction Date.
13.2.Upon termination of this Agreement, unless otherwise provided by laws and regulations, either Party may require the other Party to return or destroy documents, data, files, objects, plans, trade secrets and other tangible information obtained by the other Party pursuant to this Agreement within 7 business days after termination of this Agreement, except that duplicate documents and information may be retained as necessary to comply with the relevant provisions of law, provided that the custody and use of such retained documents and information shall still comply with Article 15.7 of this Agreement and relevant laws and regulations.
13.3.Unless otherwise agreed by the Parties, after the termination of this Agreement, other rights and obligations of the Parties under this Agreement shall cease forthwith; however, Articles 12.2, 13.2, 13.3, 14, 15.1, 15.2, 15.3, 15.7, 15.8 and 15.11 of this Agreement shall survive the termination of this Agreement. In addition, the termination of this Agreement shall not affect the rights and obligations that either Party had under this Agreement upon such termination.

Article 14 Taxes and Expenses

Unless otherwise provided in this Agreement, each of IBF Financial Holdings, Entie Bank and/or their shareholders shall bear all taxes and expenses arising out of or in connection with their negotiation, execution or performance of this Agreement (including but not limited to attorney, accountant and other advisor fees, taxes payable by either Party or its shareholders as well as other related fee).

Article 15 Miscellaneous

15.1.The interpretation, validity and performance of this Agreement shall be governed by the laws of the Republic of China. Any matters not covered in this Agreement shall be conducted in accordance with relevant laws and regulations. The headings used in each Article of this Agreement are for convenience and reference only and shall not be used as a basis for interpreting the contents of the provisions of this Agreement.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

15.2.Should any provisions hereof be in conflict with any relevant laws and/or regulations, only such provisions shall be rendered null and void, with other provisions remaining in full force and effect. In case that any terms of the Agreement as instructed by the competent authorities or required under the amendment of laws or regulations or the necessity to reflect the facts shall be amended, the boards of directors of the Parties shall make amendments based on instructions by the competent authorities without being approved in the respective shareholders’ meetings of the Parties.
15.3.Any dispute between the Parties arising from this Agreement shall be resolved via amicable negotiations in the first place. In case of any failure to reach an agreement 30 days after a Party has submitted a written request for negotiation, the Parties agree to refer such dispute to arbitration at the Arbitration Association of the Republic of China in Taipei in accordance with Arbitration Law of the Republic of China. The tribunal shall consist of three arbitrators, where each Party shall appoint one arbitrator and the two arbitrators jointly designate one chief arbitrator. The language used in the arbitration proceedings shall be Chinese.
15.4.Any amendment or change to this Agreement shall only be made upon the written consent of the Parties.
15.5.Without the prior written consent of the other Party, neither Party shall assign all or part of the rights under this Agreement to any third party, nor shall any third party assume all or part of the obligations under this Agreement.
15.6.Prior to the Share Swap Record Date, either Party that is prevented from or delays in performing the obligations under this Agreement due to any court judgment or order, order or official action of the relevant competent authorities, war, hostility, blockade, riot, revolution, shut down, nuclear disaster, fire, typhoon, earthquake, tsunami, plague, flood or other events not attributable to either Party or force majeure or other events with similar effect (“Force Majeure Event”) shall not be liable to the other Party. Notwithstanding, such Party shall notify the other Party of the occurrence of a Force Majeure Event within 5 business days after it becomes aware of such occurrence. This does not exempt any Party hereto from continuing to perform its obligations under this Agreement as soon as possible after such Force Majeure Event ends.
15.7.Unless otherwise provided in relevant laws or regulations, or unless otherwise provided in this Agreement or by the orders issued by the court or competent authority, the Parties

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

agree to keep in strict confidence any and all documents, data, files, articles, plans, trade secrets and other tangible and intangible information which is confidential in nature (“Confidential Information”) and transmitted by or gained from the other Party prior to the Share Swap Record Date for the purpose of this Transaction. The Party receiving the Confidential Information (“Recipient”) shall not distribute, divulge or provide Confidential Information to any third party in any manner or form without the prior written consent of the other Party providing the Confidential Information (“Provider”), except to the extent that the Confidential Information (1) becomes public other than as a result of a breach of this Agreement; (2) the Recipient demonstrates that it had knowledge of the Confidential Information prior to the provision of the Confidential Information by the Provider; or (3) the Recipient demonstrates that the Confidential Information was lawfully obtained by a third party from whom it had no obligation of confidentiality. For the avoidance of doubt, in the event that this Agreement subsequently cease to exist due to the rescission, cancellation, termination hereof or any other reasons, the effect of the confidentiality obligations herein shall remain unchanged and unaffected.
15.8.For any notice under this Agreement to be effective, it shall be made in writing and served to the addresses as follows by registered mail or personal delivery:

IBF Financial Holdings Co., Ltd.

Representative: Mr. Wei Chi-Lin, Chairman

Address: 17[th] Floor, No. 126, 128, 130, 132, and 7[th] , 9[th] Floor, No. 128, Lecyun 3[rd] Rd., Zhongshan Dist., Taipei City

Entie Commercial Bank Co., Ltd.

Representative: Yue Kang Ting, Chairman

Address: 16[th] , 40[th] , 41[st] Floor, No. 7, Sec. 5, Xinyi Rd., Xicun Vil., Xinyi Dist., Taipei City

Upon change of address, the Party changing its address shall notify the other Party of such change in writing, otherwise the Party changing its address may not use the change of address as a defense against the other Party.

15.9.All previous discussions, agreements and promises relating to the Matter shall be ineffective and superseded by this Agreement.
15.10. The appendix hereto shall constitute a part of this Agreement and have the same effect

as this Agreement.

15.11. The Agreement is executed in two counterparts, each of which is held by each Party.

15.12. The Agreement shall enter into effect after it is executed and delivered by the Parties.

The following Parties have agreed and executed on the said date as follows:

IBF Financial Holdings Co., Ltd. Entie Commercial Bank Co., Ltd.

(Name) (Name) (Position) (Position)

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Appendix

Terms of the issuance of class A convertible preferred shares of IBF Financial Holdings

In accordance with its Articles of Incorporation dated July 9, 2021 (the “Articles of Incorporation”), IBF Financial Holdings may issue 965,923,176 shares of Class A Perpetual Registered Preferred Shares (the “Class A Preferred Shares”) at a par value of NT$10 per share and an issue price of NT$15.70 per share, in several tranches, with the following rights and obligations and other material conditions of issuance (the “Issuance Conditions”):

I. Issue date: tentatively set on the Share Swap Record Date.
II. Expiration date: none.
III. Rights and obligations of the preferred shares:

(I) Dividends

The dividend on the Class A Preferred Shares is at a rate of 3.85% per annum (seven-year IRS 0.71% on the pricing record date (October 13, 2021) + fixed mark-up 3.14%) based on the issue price per share). The seven-year IRS rate will reset on the business day following the seventh year from the issue date and every seven years thereafter. Prior to the seven-year interest rate reset date, if IBF Financial Holdings, in consideration of the current market conditions at the time or other factors, can foresee that the reset rate per annum will exceed the relevant provisions in the applicable IBF Financial Holdings’ Articles of Incorporations on the interest rate reset date, IBF Financial Holdings shall, to the extent permitted by laws and regulations, convene a shareholders’ meeting to propose an amendment to the Articles of Incorporation as soon as possible. The interest rate reset record date is two business days for Taipei financial institution prior to the interest rate reset date. The interest rate index seven-year IRS is the arithmetic mean of Reuter’s “PYTWD” and “TAIFXIRS” seven-year interest rate swap quotes priced at 11:00 a.m. on the interest rate reset record date. If such quotes are not available on the interest rate reset record date, IBF Financial Holdings will decide in good faith and based on reasonable market quotations.

(II) Distribution of dividends
If IBF Financial Holdings has earning after the close of the fiscal year, in addition to paying all taxes in accordance with the law, such earnings shall be first used to make up for previous years’ losses, set aside the legal reserve and special reserve or reverse of the special reserve in accordance with Article 33 of this Articles of Incorporation; thereafter, the balance may be given priority to distribute the dividends of the Class A Preferred Shares in the current year.
IBF Financial Holdings has sole discretion on the distribution of dividends of Class A Preferred Shares. If no earnings are posted in the final accounts or earnings posted are insufficient to distribute of dividends of Class A Preferred Shares, or if dividend distribution of Class A Preferred Shares will cause the capital adequacy ratio of IBF Financial Holdings to fall below the minimum requirement stipulated by the law or the competent authorities, IBF Financial Holdings may resolve not to distribute dividends of Class A Preferred Shares without constituting an event of default. The preference share shareholders may not dissent.
Class A Preferred Shares are non-cumulative, and the undistributed dividends or the deficit of dividends will not be accumulated for deferred payment in the subsequent years where there are earnings. The dividend of the Class A Preferred Shares is paid annually in cash at once. The board of directors will decide the record date for the distribution of the preceding year’s dividend after the financial report is approved by the shareholders at the annual general meeting. The dividends paid in the year of issuance and in the year of redemption are calculated based on the actual number of outstanding days in that year. The distributed dividends will be recognized in the dividend statement.

(III) Excessive distribution of dividends

In addition to receiving the dividends in the Paragraph (I) of this Appendix, shareholders of Class A Preferred Shares shall not participate in the distribution for cash and capitalization of earnings and capital reserves for common shares.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

(IV) Redemption of Class A Preferred Shares

On the day following the expiration of seven years from the date of issuance, IBF Financial Holdings may, to the extent permitted by laws, redeem all or part of the preferred shares at the actual issue price by announcing and issuing a “preferred shares redemption notice” with a thirty-day effective period to the shareholders of preferred shares. The non-redeemed preferred shares shall continue to be subject to the rights and obligations of the aforementioned terms of issuance. If IBF Financial Holdings decides to pay dividends in the current year of the redemption of Class A Preferred Shares, the dividends payable as of the date of redemption are calculated based on the actual number of outstanding days in that year.

(V) Distribution of the residual assets

Shareholders of Class A Preferred Shares have priority over the shareholders of common shares in the distribution of the residual assets of IBF Financial Holdings. Shareholders of Class A Preferred Shares shall be paid in the same order as the shareholders of each preferred shares issued by IBF Financial Holdings but in the order second to the general creditors, with the distribution amount not exceeding the amount calculated at the issue price based on the issued and outstanding preferred shares at the time of the distribution.

(VI) Voting right and election right

Shareholders of Class A Preferred Shares do not have the right to vote or to elect, but have the right to vote at the preference shareholders’ meeting of Class A Preferred Shares or in matters concerning the rights and obligations of shareholders of Class A Preferred Shares. If any change in the Articles of Incorporation is detrimental to the rights of Class A Special Shareholders, a resolution of Class A preference shareholders’ meeting shall be adopted by a majority of the preference shareholders present who represent more than one-half of the total issued preferred shares.

(VII) Conversion terms

Conversion terms: Shareholders of Class A Preferred Shares may convert one Class A Preferred Shares of IBF Financial Holdings into one common share a year

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

after the date of issuance. After the convertible preferred shares are converted into common shares, their rights and obligations are the same as common shares.

(VIII) Conditions for recovery/redemption

There is no expiry date for Class A Preferred Shares. However, on the day following the seventh year of the issuance of Class A Preferred Shares, IBF Financial Holdings may redeem some or all of Class A Preferred Shares at the actual issuance price.

IV. The related issue procedures and operations, including but not limited to the determination or adjustment of the issue date, are authorized to the chairman or its authorized person to handle at his/her discretion to the extent complying with the IBF Financial Holdings’ Articles of Incorporation and the Issuance Conditions; the same will apply if there is necessary amendment or adjustment due to changes of the laws and regulations or the request of the competent authorities.

Attachment 3

Tel: +886 2 2564 3000 Fax: +886 2 2561 6123 www.bdo.com.tw

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BDO Taiwan 立本台灣聯合會計師事務所 10F., No.72, Sec. 2, Nanjing E. Rd., Taipei City 104, Taiwan (R.O.C.) 台北市南京東路二段72 號10 樓

IBF FINANCIAL HOLDINGS CO., LTD.’S INTENTION TO ACQUIRE THE SHARES OF ENTIE COMMERCIAL BANK CO., LTD.

INDEPENDENT EXPERT’S OPINION TOWARD THE FAIRNESS OF THE SHARE SWAP PRICE

To Entie Commercial Bank Co., Ltd.

Subject:

BDO Taiwan was engaged by EnTie Commercial Bank Co., Ltd. (“EnTie Bank”) to enable EnTie Bank to understand its own equity value of common shares (“equity value”) and the value of preferred shares issued by IBF Financial Holdings Co., Ltd. to exchange for EnTie Bank’s common shares (“preferred share value”) via performing the necessary calculation, analysis and evaluation procedures and to evaluate the fairness of swap price. The evaluation conclusion is as follows.

Illustration:

1. Transaction Background

In order to strengthen the competitiveness and exercise the operation synergies, EnTie Bank is contemplating the deal of share swap with IBF Financial Holdings (“IBF Financial Holdings”) . It’s expected that post transaction EnTie Bank will be more competitive operationally and globally be leveraging the resources of IBF Financial Holdings. IBF Financial Holdings offers to pay the swap price via 55% of cash and 45% of preferred shares (“Transaction”). The investment structure is shown below.

55% cash plus 45% preferred shares Shareholders of EnTie Bank IBF Financial Holdings Acquire 100% EnTie Bank of shares

BDO Taiwan, a joint accounting firm, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international

BDO network of independent member firms.

Tel: +886 2 2564 3000 Fax: +886 2 2561 6123 www.bdo.com.tw

BDO Taiwan 立本台灣聯合會計師事務所 10F., No.72, Sec. 2, Nanjing E. Rd., Taipei City 104, Taiwan (R.O.C.) 台北市南京東路二段72 號10 樓

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2. Companies Background[1]

EnTie Bank was established in June 1992 with operations started in April 1993. Stock of EnTie was traded on the over-the-counter market in December, 1995 and listed on the Taiwan Stock Exchange since September, 1999 with the ticker of 2849. In November 2007, EnTie Bank successfully closed a capital injection by a consortium led by a private equity fund, The Longreach Group, and recruited a new management team to transform the Bank into a customer-oriented modern financial services provider. In order to meet client’s various demands of financial services, EnTie Bank divided the organization into corporate banking and personal banking and provided the services of deposits, loans, financial transactions, wealth management, digital banking, etc. At present, EnTie Bank has 50 operating units across Taiwan.

IBF Financial Holdings was officially established by International Bills Finance Corp. (founded in January 1977) via the share swap with Concourse Securities Co., Ltd., (“Concourse Securities”) and Grand Orient Securities Corp. (“Grand Orient Securities”) on March 26, 2002 and went listed in Taiwan Stock Exchange with the ticker of 2889 as the only financial holding deriving from a bills finance corporation. In October of the same year, Concourse Securities, Grand Orient Securities and International Bills Union Securities Co., Ltd. were united and named as Waterland Securities Co., Ltd. IBF Financial Holdings is aimed to become a niche investment bank by focusing its resources on the businesses of bill financing, securities, investment advisory, future and venture capitals.

3. Purpose of Fairness Opinion

In order for EnTie Bank to understand the swap price as of the valuation date, October 14, 2021, and the value of preferred shares issued by IBF Financial Holdings to exchange for 45% of EnTie Bank’s common shares, according to Business Mergers And Acquisition Act, EnTie Bank engaged BDO Taiwan to perform necessary calculation, analysis and evaluation procedures to express opinion on the fairness of the equity value. The relevant evaluation has been completed by BDO Taiwan.

4. Disclaimer

On an objective and fair position without any biases toward EnTie Bank and IBF Financial Holdings, BDO Taiwan, based on the calculation, analysis and valuation, evaluated the fairness of swap price with due professional care and expressed opinion toward the fairness. The financial information contained in the opinion included the high-level

1 Source: websites of EnTie Bank and IBF Financial Holdings, 2020 Annual Reports, etc

BDO Taiwan, a joint accounting firm, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

Tel: +886 2 2564 3000 Fax: +886 2 2561 6123 www.bdo.com.tw

BDO Taiwan 立本台灣聯合會計師事務所 10F., No.72, Sec. 2, Nanjing E. Rd., Taipei City 104, Taiwan (R.O.C.) 台北市南京東路二段72 號10 樓

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financial due diligence report on IBF Financial Holdings and its subsidiaries, IBF Financial Holding’s audited and self-prepared financial statements as of June 30, 2021, the relevant financial information about the equity value and preferred share value and other public reference material either in hard/soft copy or online information, and was used for the evaluation according to Article 6 of Business Mergers And Acquisition Act. Regarding the definitions of completeness, correctness and reasonableness, they are in accordance with Article 19, 21 and 23 of valuation standard No.8 and No.298 explanatory letter issued by Accounting Research and Development Foundation. However, according to the scope of this engagement, BDO Taiwan did not perform audits in accordance with generally accepted audit standards on the above-mentioned data and did not expressed any opinion and provide any assurance.

5. Opinion on the fairness of swap price

The valuation date is October 14, 2021 tentatively. BDO Taiwan performed the necessary analysis and calculation in consideration of financial information about equity value and preferred share value to evaluate the range of swap price. The summary of fairness opinion is as follows.

5.1. Valuation Approach –

The commonly-used valuation approaches in practice include the following methods.

5.1.1. Market Approach -

Market approach is based on the comparable targets’ transaction price, considers the differences between the valuation target and comparable targets and uses appropriate value multiples to estimate the value of valuation target. The typical types of market approach are as follows.

a) Comparable companies method - referring to the companies with similar or the same business whose shares are frequently traded in open market. The transaction price, value multiples and relevant transaction information can determine the value of target. This method is suitable for valuation of enterprise or business.
b) Comparable transactions method - referring to the transaction prices of similar or same assets. The value multiples and relevant transaction information can determine the value of target. This method is suitable for valuation of enterprise, business, individual asset or individual liability.

BDO Taiwan, a joint accounting firm, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

Tel: +886 2 2564 3000 Fax: +886 2 2561 6123 www.bdo.com.tw

BDO Taiwan 立本台灣聯合會計師事務所 10F., No.72, Sec. 2, Nanjing E. Rd., Taipei City 104, Taiwan (R.O.C.) 台北市南京東路二段72 號10 樓

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5.1.2. Income Approach -

Income approach is based on the future income stream generated by the valuation target and turns the future income stream into the value of valuation target via capitalization or discount. When this approach is selected, the income stream should be defined and the corresponding discount rate or capitalization rate should also be used in consideration of whether the risk of valuation target is reasonably reflected.

5.1.3. Asset Approach -

This is a method of determining the value of enterprise or business by evaluating the total value of assets net of liabilities. Unless asset approach is appropriate due to specialties of valuation target, this approach cannot be the only method adopted for valuation. However, if the target is not assumed to be continuously going-concern or used, the asset approach is usually selected for the valuation of such target, i.e. the liquidation value. Balance sheet is the main base of this approach in consideration of off-balance-sheet assets and liabilities.

When the asset approach is adopted, the individual asset or asset group, individual liability or liability group or combination of both should be seen as separate valuation objects and be evaluated by proper approaches, including market approach and income approach, depending on the specific natures.

5.1.4. Market Price Method

The average transaction price of the valuation object traded in the open securities market is used for the basis of evaluating the valuation object.

5.2. Explanation about the issuance of the analysis on the equity value and preferred share value

BDO Taiwan understood and considered EnTie Bank’s current operation, status of assets and liabilities and the industry characters. After considering the specialties of equity value and preferred share value, limits on valuation approaches and appropriateness for the transaction, BDO Taiwan selected the following approaches with explanations.

BDO Taiwan, a joint accounting firm, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

Tel: +886 2 2564 3000 BDO Taiwan

Fax: +886 2 2561 6123 立本台灣聯合會計師事務所 www.bdo.com.tw 10F., No.72, Sec. 2, Nanjing E. Rd., Taipei City 104, Taiwan (R.O.C.) 台北市南京東路二段72 號10 樓

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5.2.1 Fairness evaluation on the equity value of EnTie Bank’s total common share

- a) Market Approach Comparable Companies Method

In order to reasonably estimate the equity value, the management of EnTie Bank provided to BDO Taiwan the list of 6 comparable listed companies in Taiwan with the same or similar business to EnTie Bank, including King's Town Bank (2809.TW), Taichung Commercial Bank Co., Ltd. (2812.TW), Union Bank of Taiwan (2838.TW), Far Eastern International Bank (2845.TW), EnTie Commercial Bank (2849.TW) and O-Bank Co., Ltd. (2897.TW). BDO Taiwan also inspected the revenues from related businesses in these companies and considered the industry characteristics. The financial information of these comparable companies is summarized in Table 1.

Table 1 Summary of the financial information of Comparable Companies

Unit: New Taiwan Dollars (“NTD”) in millions

Name	Period of financial statements	Market cap (P)	Company’s equity (B)	Net income (NI)
King's Town Bank	2020.7~2021.6	47,722	47,706	7,839
(2809.TW)
Taichung	2020.7~2021.6	50,200	59,909	4,461
Commercial Bank
(2812.TW)
Union Bank	2020.7~2021.6	38,654	63,964	4,324
(2838.TW)
Far Eastern Bank	2020.7~2021.6	37,319	48,782	2,353
(2845.TW)
EnTie Bank	2020.7~2021.6	31,761	34,140	2,209
(2849.TW)
O Bank (2897.TW)	2020.7~2021.6	21,115	35,750	1,666

Source: The financial information of comparable companies was obtained from Refinitiv and summarized by BDO Taiwan. Note: The above calculation was made by computer. Minor error came from the decimal adjustment.

BDO Taiwan adopted the market multiples and considered EnTie Bank’s current operation to calculate the equity value as of valuation date and generated the price range via the medians of the price to net income (“P/NI”) and the price to book value (“P/B”). Considering the impact of control over EnTie Bank on the equity value, BDO Taiwan used 9.80%, the median of control premium summarized from the industry in Taiwan for the last decade according to Business Valuation Resource ( “ BVR ” ) database as of valuation date, to reflect the effect. The results and adjustments can be found in Table 2 below.

BDO Taiwan, a joint accounting firm, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

Tel: +886 2 2564 3000 BDO Taiwan

Fax: +886 2 2561 6123 立本台灣聯合會計師事務所 www.bdo.com.tw 10F., No.72, Sec. 2, Nanjing E. Rd., Taipei City 104, Taiwan (R.O.C.) 台北市南京東路二段72 號10 樓

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Table 2 EnTie Bank – Value Per Share Adjustment and Conclusion of Comparable Companies Method

Unit: NTD in millions

Companies Method Unit: NTD in millions
Market Multiples	P/NI	P/B
Equity value of common shares before adjustment 26,415 30,384 Plus control premium 2,589 2,978 Equity value of common shares in consideration of control premium 29,004 33,362 Outstanding shares of EnTie Bank as of Oct.14, 2021 (thousand shares) 1,957,910 1,957,910 Equity value per share of common shares as of Oct.14, 2021 (NTD) 14.81 17.04

Source: The relevant multiples and financial numbers were from Refinitiv, and summarized by BDO Taiwan. Note:

The above calculation was made by computer. Minor calculation inconsistency came from the decimal adjustment.
The adopted multiples are calculated excluding outliers.

b) Market Price Method

Considering that EnTie is a listed company with objective trading price for reference which reacts to relevant information promptly, for market price method, BDO Taiwan selected the average closing prices of 1 consecutive transaction days, 3 consecutive transaction days, 5 consecutive transaction days, 30 consecutive transaction days, and 90 consecutive transaction days prior to October 14, 2021 (Valuation Date), the tentative valuation date, for reference. Please refer to the summary of calculation results for equity value per share in Table 3 below.

Table 3 EnTie Bank - Value Per Share Adjustment and Conclusion of Market Price Method

Unit: NTD; Unless otherwise specified

Transaction Days	1 day 3 days 5 days 30 days 90 days	1 day 3 days 5 days 30 days 90 days	1 day 3 days 5 days 30 days 90 days	1 day 3 days 5 days 30 days 90 days	1 day 3 days 5 days 30 days 90 days
Equity value per share of common shares Plus control premium Equity value of common shares in consideration of control premium Equity value per share of common shares as of Oct. 14, 2021	17.00 1.67 18.67 18.67	16.83 1.65 18.48 18.48	16.51 1.62 18.13 18.13	16.22 1.59 17.81 17.81	15.52 1.52 17.04 17.04

Source:

Equity value per share was from Refinitiv 。
The above calculation was made by computer. Minor calculation inconsistency came from the decimal adjustment.

BDO Taiwan, a joint accounting firm, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

Tel: +886 2 2564 3000 BDO Taiwan

Fax: +886 2 2561 6123 立本台灣聯合會計師事務所 www.bdo.com.tw 10F., No.72, Sec. 2, Nanjing E. Rd., Taipei City 104, Taiwan (R.O.C.) 台北市南京東路二段72 號10 樓

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c) Reasonable Value Range Per Share of EnTie Bank’s Common Shares

BDO Taiwan considered EnTie Bank’s operation status and adopted the abovementioned methodologies to reach a price range. The market price method using Level I valuation technical inputs was selected ultimately. The price of equity value per share ranged from NTD 17.04 to NTD 18.67.

5.2.2 Evaluation on the value of preferred shares to be issued by IBF Financial Holdings

In accordance with International Financial Reporting Standards No. 13, Fair Value Measurement, (“IFRS 13”) when measuring the fair value of financial instruments, the valuation techniques shall be applied. The three methodologies, market approach, cost approach and income approach[2] , are widely applied. In addition, Statements of Valuation Standards No. 12, Financial Instruments Valuation, (“SVS 12”) also stipulated that the above-mentioned three approaches are commonly used for financial instruments valuation[3] .

IFRS 13 and SVS 12 also explain that the valuation technical inputs for measuring financial instruments can be divided into three categories.

Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date.
Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. For example, quoted prices for similar assets or liabilities in active markets.
Level 3 inputs are unobservable inputs for the asset or liability.

The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1 inputs) and the lowest priority to unobservable inputs (Level 3 inputs).

- Market Approach Matrix Pricing

The methodology adopted here is consistent with market approach, including matrix pricing. Matrix pricing is a mathematical technique mainly used for the valuation of certain

2 Paragraph 62 and B7, IFRS13

3 Article 22, SVS12

BDO Taiwan, a joint accounting firm, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

Tel: +886 2 2564 3000 BDO Taiwan

Fax: +886 2 2561 6123 立本台灣聯合會計師事務所 www.bdo.com.tw 10F., No.72, Sec. 2, Nanjing E. Rd., Taipei City 104, Taiwan (R.O.C.) 台北市南京東路二段72 號10 樓

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types of financial instruments, such as debt securities, without reliance on the quotation of a specific security but on the relation between the security to be valued and the indicative one with quotation[2] . Hence, the said methodology is suitable for the valuation of the preferred shares in this transaction provided that the price of preferred shares to be issued by IBF Financial Holdings is dependent on IBF Financial Holdings’ stock price and relevant issuing conditions.

Moreover, given the going-concern consideration, BDO Taiwan considered the possible scenarios of future operation and evaluated the corresponding possibilities to derive the preferred share value. The relevant conditions and valuation methodology are summarized below.

1. Contract terms

Par interest rate: 3.85%

Issuing period: Perpetuity Issuing price: 101% of the highest of IBF Financial Holdings’ share price 1 day, 3 days or 5 days prior to the valuation date

Redemption price: 100% of par value upon seven years after issuance Swap condition: upon one year after issuance Swap ratio: 1:1

Source: Contract terms are provided by EnTie Bank’s management and summarized by BDO Taiwan.

2. Introduction of Valuation Methodology

Step 1

Provided that the change in stock price of the acquiring company follows Brownian motion for 100 years

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among which

γ : interest rate

σ: volatility
T : term (the duration of 7 years in this transaction)
WT : Brownian motion 。

BDO Taiwan, a joint accounting firm, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

Tel: +886 2 2564 3000 BDO Taiwan

Fax: +886 2 2561 6123 立本台灣聯合會計師事務所 www.bdo.com.tw 10F., No.72, Sec. 2, Nanjing E. Rd., Taipei City 104, Taiwan (R.O.C.) 台北市南京東路二段72 號10 樓

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Step 2

Following Step 1 to simulate the stock prices for 100 years via Monte Carlo Method 。

Step 3 `：`

Using the least square Monte Carlo simulation and discounting the numbers from the 100[th] year to the valuation date, Backward Method. Between the 7[th] year and the 100[th] year, due to the redemption and the conversion, the preferred share value is Max (conversion value, redemption value). Between the 2[nd] year and the end of the 6[th] year, due to the conversion, the preferred share value is Max (conversion value, continuous holding value). By following the steps to backward estimate the value as of valuation date of each route, discount it by the risk discount rate (adjusted Capital Asset Pricing Model, “adjusted CAPM”) to the valuation date and get the average after adding up all these outputs, the preferred share expected value can be generated.

Table 4 Adjusted CAPM and Relevant Parameters

Table 4 Adjusted CAPM and Relevant Parameters
Dividend yield	3.85%
Risk-free interest rate (Rf)	0.41%
Beta	0.46
Market risk premium (Rm)	7.76%
Size risk premium (E)	1.37%
Company specific risk premium (F)	1.03%
Risk discount rate	6.41%
(CAPM=Rf+β*Rm+E+F)
Stock price volatility	15.52%

Source: Rf is the 7-year risk-free rate, adopted from Taipei exchange, Beta is from Refinitiv, Rm is from NYU Damodaran, Size risk premium is from Duff & Phelps, Company specific risk premium is the 7-year TWBBB bond rate given IBF Financial Holdings’ credit rating of BBB Note 2: The numbers and calculation above were made by computer. Minor calculation inconsistency came from the decimal adjustment.

Table 5 Summary for Theoretical Value of Preferred Shares

Unit: NTD; unless otherwise specified

Unit: NTD;unless otherwise specified
Valuation date Transaction days		2021/10/14
	1 day	3 days	5 days 30 days 90 days
Average of closing price of IBF Financial Holdings common shares (considering share dividend) Expected issuance price per share of preferred shares to be issued by IBF Financial Holdings (share price of common share + 1%) Theoretical value of preferred shares per share issued by IBF Financial Holdings as of Oct. 14, 2021	15.55 15.70 16.35	15.55 15.70 16.35	15.53 15.69 16.33	15.42 15.58 16.20	15.79 15.94
					16.59

Note: The above calculation was made by computer. Minor error came from the decimal adjustment.

BDO Taiwan, a joint accounting firm, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

Tel: +886 2 2564 3000 Fax: +886 2 2561 6123 www.bdo.com.tw

BDO Taiwan 立本台灣聯合會計師事務所 10F., No.72, Sec. 2, Nanjing E. Rd., Taipei City 104, Taiwan (R.O.C.) 台北市南京東路二段72 號10 樓

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Considering IBF Financial Holdings’ operation, BDO Taiwan adopted the above-mentioned valuation technique and concluded the range for theoretical value per share of preferred shares to be issued by IBF Financial Holdings from NTD 16.20 to NTD 16.59. Hence, the lower issuance price of preferred shares to be issued by IBF Financial Holdings than the theoretical 。 value of preferred shares is fair.

6. Illustration about Hypotheses

The Project was to be executed under the assumptions that from the valuation date to the report date external environment, like macro-economy condition, political and investment environments, and internal conditions, such as operation of EnTie Bank and IBF Financial Holdings, did not change significantly. In addition, equity value might vary significantly for different purposes, under different assumptions or as of different valuation date. Plus, the uncertainty of global economic development was further enhanced due to the pandemic of COVID-19 from late January of 2020. BDO Taiwan does not guarantee that the opinion is still valid if any of above-mentioned situations occurs.

7. Conclusion

The Project is performed in accordance with valuation standards. The standard of value is market value. BDO Taiwan obtained relevant financial information about the Project and, for the valuation approaches, basic assumptions, valuation estimates and other key factors regarding EnTie Bank’s common share equity value and the value of preferred shares to be exchanged, performed necessary analysis and calculation to evaluate the potential risks which may impact the equity value

Considering the operation status of EnTie Bank, BDO Taiwan adopted the abovementioned valuation techniques to generate the price range of equity value as of valuation date, NTD 17.04 to NTD 18.67.

Given EnTie Bank’s current operation status and going-concern assumption, BDO Taiwan, based on the above-stated results of transaction consideration, thinks that if EnTie Bank adopts the swap price (IBF Financial Holdings pays 55% in cash and 45% in preferred share issued by IBF Financial Holdings) within this range to carry out the potential transaction or EnTie Bank determines the transaction price based on the conservation principle in order for the best interest of shareholders, it’s reasonable in terms of shareholders’ interests protection.

BDO Taiwan, a joint accounting firm, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

Tel: +886 2 2564 3000 Fax: +886 2 2561 6123 www.bdo.com.tw

BDO Taiwan 立本台灣聯合會計師事務所 10F., No.72, Sec. 2, Nanjing E. Rd., Taipei City 104, Taiwan (R.O.C.) 台北市南京東路二段72 號10 樓

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Limits
8.1 The opinion pertained to the foregoing items only and was not further connected to the whole financial report of common share equity value and preferred share value.
8.2 BDO Taiwan, as an independent third party, evaluated whether the transaction price was proper without involving in the design and plan of transaction structure. The valuation date of fairness opinion was October 14, 2021. Therefore, this opinion did not consider any changes occurring after that. If the actual transaction differs from the previous explanation, the conclusion will vary accordingly. If the actual situation changes after the issuance of opinion, BDO Taiwan will not update the opinion unless BDO Taiwan is reengaged.

Shu-Chen Chang For and on behalf of BDO Taiwan October 14, 2021

Notice to Readers

For the convenience of readers, the fairness opinion has been translated into English from the original Chinese version prepared and used in the Republic of China. If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, the Chinese-language fairness opinion shall prevail.

BDO Taiwan, a joint accounting firm, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

Tel: +886 2 2564 3000 BDO Taiwan

Fax: +886 2 2561 6123 立本台灣聯合會計師事務所 www.bdo.com.tw 10F., No.72, Sec. 2, Nanjing E. Rd., Taipei City 104, Taiwan (R.O.C.) 台北市南京東路二段72 號10 樓

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REPRESENTATION OF INDEPENDENT EXPERT

I was engaged to issue the opinion on the fairness of swap price at which IBF Financial Holdings Co., Ltd. intends to acquire EnTie Commercial Bank Co., Ltd.’s common share. The engagement was performed in accordance with Business Mergers And Acquisition Act and relevant regulations with reference to Statements of Valuation Standards and selfdiscipline rules to issue an opinion toward fairness. I declared the statements below ：

I executed the foregoing engagement in accordance with Article 6, Business Mergers And Acquisition Act. The data sources, multiples and information utilized in the execution were complete, correct and reasonable and used as the basis of issuing this opinion. Regarding the definitions of completeness, correctness and reasonableness, they are in accordance with Article 19, 21 and 23 of valuation standard No.8 and No.298 explanatory letter issued by Accounting Research and Development Foundation.
Prior to the engagement, I have confirmed that I met the qualification of Item 1, Article 5, Regulations Governing the Acquisition and Disposal of Assets by Public Companies and cautiously evaluated my professional capability and practical experiences.
Upon executing the engagement, I have properly arranged and performed the procedures to reach a conclusion as the basis of issuing the opinion. Furthermore, the procedures I performed, data I collected and the conclusion were all noted in the working paper in detail.
I do not have the relations with related parties or related parties in substance with the above-mentioned companies. Plus, I performed the engagement independently and claimed that the conditions below did not exist.
4.1 I am the related party to the above-mentioned companies either in substance or formally according to the definition of International Accounting Standard No. 24.
4.2 My spouse or I is retained by the foregoing companies now, does common work for them and receives routine salary or act as their director or supervisor.

BDO Taiwan, a joint accounting firm, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

Tel: +886 2 2564 3000 Fax: +886 2 2561 6123 www.bdo.com.tw

BDO Taiwan 立本台灣聯合會計師事務所 10F., No.72, Sec. 2, Nanjing E. Rd., Taipei City 104, Taiwan (R.O.C.) 台北市南京東路二段72 號10 樓

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4.3 My spouse or I was director or supervisor or the manager or key employee relevant of the Project of the foregoing companies and was dismissed for less than two years.
4.4 The company my spouse or I are working for is related party to the foregoing companies.
4.5 The director, supervisor, manager or key employee relevant to the Project of the foregoing companies is my spouse or relative
4.6 My spouse or I significantly invest or shares benefits with related parties of the foregoing companies.
4.7 I am the auditor of the foregoing companies.
4.8 I am the relative or spouse to the director or supervisor of Taiwan Stock Exchange or Taipei Exchange.
4.9 The company myself or my spouse works for has business with the foregoing companies.

Shu-Chen Chang For and on behalf of BDO Taiwan October 14, 2021

BDO Taiwan, a joint accounting firm, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

Tel: +886 2 2564 3000 Fax: +886 2 2561 6123 www.bdo.com.tw

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BDO Taiwan 立本台灣聯合會計師事務所 10F., No.72, Sec. 2, Nanjing E. Rd., Taipei City 104, Taiwan (R.O.C.) 台北市南京東路二段72 號10 樓

RESUME OF THE INDEPENDENT EXPERT

Name Shu-Chen Chang License Taiwan CPA Current job Partner, BDO Taiwan Education Master of accountancy of Taipei University Bachelor of accountancy of Chung Yuan Christian University Experiences Member of corporate filing committee of CPA association in Taipei

BDO Taiwan, a joint accounting firm, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

AI assistant

EnTie Bank — Proxy Solicitation & Information Statement 2021

52205_rns_2021-12-14_0a9c0d03-66da-4f6e-a6b9-64d183dbff13.pdf

EnTie Commercial Bank Co., Ltd.

Notice of 2021 First Extraordinary General Meeting of Shareholders

(i) Reporting Items:

(iii) Extemporaneous Motions

III. Attachment:

Attachment 1

Audit Committee’s Review Report on the Company’s Share Swap with IBF Financial Holdings Co., Ltd.

SHARE SWAP AGREEMENT

and

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Table of Content

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Share Swap Agreement

Article 1 Share Swap

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Article 2 Pre-Share Swap Amounts of Capital, Number and Types of Outstanding Shares

Article 3 Share Swap Transaction Consideration, Share Swap Ratio, and Amendments to Articles of Incorporation

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Article 4 Transaction Consideration Adjustment

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Share Consideration *EOS

Share Consideration

Share Consideration * EOS

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Article 5 Share Swap Schedule

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Article 6 Conditions Precedent to the Share Swap

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Article 7 Representations and Warranties

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Article 8 Covenants

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Article 9 Handling of Dissenting Shares

Article 10 Directors and Independent Directors of Entie Bank

Article 11 Protection of Rights and Interests of Employees of Entie Bank

Article 12 Events of Default

Article 13 Termination

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Article 14 Taxes and Expenses

Article 15 Miscellaneous

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

Appendix

Terms of the issuance of class A convertible preferred shares of IBF Financial Holdings

(I) Dividends

(III) Excessive distribution of dividends

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

(IV) Redemption of Class A Preferred Shares

(V) Distribution of the residual assets

(VI) Voting right and election right

(VII) Conversion terms

The English translation is for reference purpose only. In the event there is any discrepancy or ambiguity between the English translation and the Chinese original, the Chinese original shall prevail.

(VIII) Conditions for recovery/redemption

INDEPENDENT EXPERT’S OPINION TOWARD THE FAIRNESS OF THE SHARE SWAP PRICE

Subject:

Illustration:

EnTie Bank Proxy Solicitation & Information Statement 2021

Step 3 `：`