FPC - AGM Information 2022 | FinancialReports.eu

FORMOSA PLASTICS CORPORATION

2022 ANNUAL SHAREHOLDERS’ MEETING

MEETING HANDBOOK

(This English translation is prepared in accordance with the Chinese version and is for reference purposes only. If there are any inconsistency between the Chinese original and this translation, the Chinese version shall prevail.)

JUNE 9, 2022

Meeting Procedure……………..………………………………. page 1 Meeting Agenda……………….……………..………………… page 2 Report Items…………………………………………………… page 3 Ratification Items……………………………………………… page 22 Discussion Items….……..…………………………………….. page 24 Appendices………………………………………………..…… page 47

Independent Auditor’s Report
Articles of Incorporation of the Company
Rules of Procedure for Shareholders’ Meetings of the Company
Procedures for Acquisition or Disposal of Assets of the Company
Current Shareholdings of Directors of the Company
Information regarding the Proposed Employees and Directors’ Compensation approved by the Board of Directors of the Company
Effect upon Business Performance and Earnings per Share of the Company by the Stock Dividend Distribution Proposed at the 2022 Annual Shareholders’ Meeting

FORMOSA PLASTICS CORPORATION

2022 ANNUAL SHAREHOLDERS’ MEETING PROCEDURE

Call Meeting to Order
Chairman’s Address
Report Items
Ratification Items
Discussion Items
Extraordinary Motions
Meeting Adjourned

FORMOSA PLASTICS CORPORATION

2022 ANNUAL SHAREHOLDERS’ MEETING AGENDA

Time : 10:00 a.m., Thursday, June 9, 2022
Venue : Sunworld Dynasty Hotel, Taipei
(NO. 100, Dun Hua North Road, Taipei, Taiwan)

Means : Physical Shareholders’ Meeting

1. Report Items

(1) 2021 Business Report
(2) Audit Committee’ Review Report on the 2021 Financial Statements
(3) Distribution of 2021 Employees Compensation
(4) Issuance of 2021 Domestic Unsecured Ordinary Corporate Bonds

2. Ratification Items

(1) Please approve the 2021 Business Report and Financial Statements as required by the Company Act.
(2) Please approve the Proposal for Distribution of 2021 Profits as required by the Company Act.

3. Discussion Items

(1) Amendment to the Articles of Incorporation of the Company. Please discuss and resolve.
(2) Amendment to Procedures for Acquisition or Disposal of Assets of the Company. Please discuss and resolve.

Report Items

About the Company’s results of operation for fiscal year 2021, please refer to Business Report for further details (on page 5 of the Handbook.) which is hereby reported for record.
The Company’s Audit Committee members reviewed the 2021 Business Report and Financial Statements and issued their Review Report according to the applicable laws. Please refer to Audit Committee’s Review Report (on page 21 of the Handbook.)
The company has issued the report on compensation distributed to its employees for 2021. The pre-tax profit prior to deducting employees’ compensation distributable for 2021 is NTD 82,428,864,457. The Company has no accumulated losses. Adopted by the Board Meeting on March 10, 2022, 0.13% of the profit is allocated as employees’ compensation in accordance with Article 39 of the Articles of Incorporation. The total allocated amount is NTD 110,562,838 which shall be distributed in cash. The above is hereby reported for record.
Issuance of NTD 7.5 Billion Domestic Unsecured Ordinary Corporate Bonds in 2021
(1)To raise long-term funds to pay off loans, the Board of Directors resolved on December 17, 2020 to issue domestic unsecured ordinary corporate bonds of NTD 20 Billion in 2021. According to the capital needs, the Company issued the bonds of NTD 7.5 Billion on September 15, 2021, and the rest of unissued bonds of NTD 12.5 Billion was not applied for Taipei Exchange, which was reported to the Board of Directors on December 21, 2021.

(2)A summary of the major terms of the aforementioned bonds are as follows:

Tranche	Size (NTD billion)	Coupon Rate(%,fixed annual rate)	Tenor (Year)	Principal Repayment Year
A	4.3	0.46	5	Half of the principal shall be repaid upon the end of the fourth year and the fifth year, respective from the date of issue.
B	3.2	0.52	7	Half of the principal shall be repaid upon the end of the sixth year and the seventh year, respective from the date of issue.
Coupon Frequency	Annual. Interest shall be paid as simple interest rate.

The above is hereby reported for record.

Formosa Plastics Corporation 2021 Business Report

1. 2021 Business Report:

The Company (Formosa Plastics Corporation) generated consolidated sales of NTD 273.59bn in 2021, reaching 137% of its target of NTD 198.98bn and was up by 47% from NTD 185.81bn generated in 2020. Consolidated pre-tax profit came in at NTD 85.95bn in 2021, reaching 248% of its target of NTD 34.65bn and grew by 256% from NTD 24.16bn generated in 2020.

Because of the acceleration of COVID-19 vaccinations worldwide, the global economy rebounded strongly in 2021 with easing the pandemic restriction and launching expansionary fiscal and easy monetary policies continuously by countries to make the demand recovery for petrochemical products. On the back of recovering demand as well as the frequent occurrence of supply disruptions, caused by the force majeure from the US peers due to the snowstorm in February and hurricane in August in Texas, unexpected shutdown from the peers in the US and Europe, supply chain difficulty and energy policy in China, the imbalance of supply and demand triggered the price surge for petrochemical products. Especially, prices for polyvinyl chloride (PVC), ethylene vinyl acetate copolymer (EVA), N-butanol (NBA), acrylonitrile (AN) and epichlorohydrin (ECH) all achieved historical high levels in 2021.

Benefitting from the widening product spreads thanks to the larger increase in average price than that in raw materials prices, the Company’s operating profit of NTD 60.16bn climbed up by 252% or by NTD 43.06bn in 2021 from 2020. Despite the fact that dividend income of NTD 3bn in 2021 decreased by NTD 0.35bn from 2020, the Company’s investment income increased significantly by NTD 18.24bn to NTD 23.45bn from Formosa Petrochemical Corp. and FPC-USA, which led to its pre-tax income’s strong growth of 256% in 2021, hitting the record high levels since the Company was established in 1954.

Looking back into 2021, with the rising vaccination rate in major countries and the loosening COVID-19 prevention measures, global

economy has seen robust recovery since Q2 in 2021. However, in view of the highly contagious Delta variant, several economies re-implemented the prevention controls. Together with the supply chains difficulty, shortage of energy sources and surging energy prices, the pace of global recovery slowed down in H2 of 2021. In spite of impact from Taiwan government’s severe pandemic restrictions on Taiwan domestic consumption, Taiwan’s economy achieved the highest growth in 2021 in the last eleven years, thanks to resilient export order demand driven by the resumption of global trade activities, and the increasing enterprise investment triggered by easing monetary policies.

In order to mitigate the crisis of global warming and extreme weather, more than 130 countries have targeted to achieve “net-zero emission” by 2050 and speeded up to implement several carbon emission controlling measures, of which European Union has announced that the carbon emission data of certain imports goods would start being required to disclose in 2023. Furthermore, European Union will begin imposing carbon tariffs in 2026, in which China, the US, Japan and Canada have also shown intentions to follow. As Taiwan is formulating policies related to total carbon emission controls, carbon trading and carbon fee pricing, if those policies cannot meet international requirements regarding net-zero emission plan, carbon tariffs and reductions of carbon in supply chains, Taiwanese companies may be subject to double taxation and their international competitiveness will also be impacted.

Moreover, to attain net-zero emission goal by 2050 and promote “non-nuclear home”, Taiwan government has targeted to achieve “20% renewable energy power generation, 30% coal combustion, and 50% natural gas” in 2025 and guarantees the stability of energy supply. Despite Taiwan has independent power grids, the government completely discarded carbon-free nuclear energy as a mean of power generation and instead replace it with enlarged capacity of natural gas and renewable energy. However, for natural gas, Taiwan is highly depended on imports (98% from foreign countries) and there are problems of limited storage capabilities and transporting issues. For renewable energy, it is faced with

challenges of unstable power supply and delayed construction timelines. In light of the power outages in March 3, 2022 and two times of regional power outages in 2021, companies have become cautious of stability of power supply in Taiwan, which not only poses risk to the long-term industry development but also brings about more uncertainties for Taiwan to achieve the goal of net-zero emission by 2050.

In addition, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) has been formed, and Regional Comprehensive Economic Partnership Agreement (RCEP), which spans 15 countries, covers more than 2.2bn people, and accounts for about one-third of global GDP, has also officially taken effect starting from 2022. In the short term, RCEP’s impact to Taiwan is not too significant with low deduction of tariffs rate, long preferential period, exempt from tariffs about 70% of Taiwan’s exports to the ASEAN region and some of Taiwanese companies already having plants in ASEAN region. However, in the long term, due to Taiwan’s less than 10% covering of free trade agreement (FTA) with trades partners and the mounting tariff pressure, it may not only harm Taiwan’s international trade, but also force more companies to relocate production plants outside Taiwan and, therefore, result in the hollowing-out for industries, which will decelerate the growth momentum for the export-oriented Taiwan, especially for the sectors of petrochemical, steel and textile.

In light of low-carbon transformation trend and the increasingly challenging business environment, it’s recommended that government should not only develop a fair tax incentive scheme to encourage corporates’ commitments in carbon reduction mechanisms, but also develop carbon pricing related policies to eliminate the gap with international standards and strengthen capabilities of carbon management. It is also crucial to review and compare Taiwan’s current energy transformation policies with the practices of Europe, the US, Japan and other countries, and re-plan a more suitable power generation structure without sacrifice of any energy sources to ensure stable and sufficient power supply in Taiwan and make the manufactures operate without

concerns. Moreover, to offset the negative impact from RCEP on the industries, Taiwan is encouraged to cultivate a business environment with more clear and comprehensive business regulations, and actively promote to join CPTPP and have bilateral trade agreements with important international business partners. The collaboration between the government and the industries is highly encouraged to strengthen our economic and industrial advantages by providing more comprehensive business policies and regulations, improving carbon pricing mechanisms and incentive measures, ensuring stable power supply, and joining regional economic integration, so as to overcome the challenges ahead.

In response to the lingering effect from COVID outbreak, supply chain disruption, the petrochemical capacity additions from peers, the Company adheres to the two founders' philosophy of “stainable operation and contribution to society” and has benefitted from the more than 20-year developments in 5S management, energy conservation, carbon reduction, circular economy and artificial intelligence (AI). The Company has fully supported the supply of raw materials for medical masks and hygiene products since 2020, and in 2021, targeted to stop supplying disposable plastics for consumers by 2025. In addition, the success in developing anti-bacterial oyster shell powder, anti-fouling compound resin, biodegradable and green plastic and carbon capture technology are the fruitful results of realizing social responsibility and corporate citizenship missions.

The Company’s purpose is to make small breakthroughs through innovative R&D and product design to change human consumption behavior, thereby creating a huge positive impact on social well-being. Among them, the “P-Tex Biomimic Zwitterionic Anti-fouling Plastic” was developed in cooperation with the Company’s investee, PuriBlood Medical Co. Ltd., and was awarded the “Enterprise Innovation Award” in the 18th National Innovation Award in 2021.

Furthermore, the Company has been proactively engaging in the development of AI technology, to enhance operational efficiency in five aspects “optimization of production and sales, quality assurance,

intelligent maintenance, industrial safety and environmental protection and cost reduction”. In 2021, 113 out of 201 AI projects have been completed with an estimated annual benefit of NTD 460mn. Besides, the Company continues to select outstanding talents to train in Taiwan’s AI schools. As of the end of 2021, 76 talents have completed the training. In an effort to cultivate more high-end AI talents in order to build a solid foundation for digital transformation, the Company continues providing systematic training courses to employees, interacting with companies and academic institutions outside the Company, inviting domestic and foreign experts for speeches, building platforms to hold competitions, etc. Since 2021, the Company has also developed automatic machine learning and “Data lake” platform to ensure operational improvement.

Moreover, to satisfy the customers’ need, the Company evaluates the performance of production, selling and R&D regularly, and develop the new products and applications with mastering the international trend. To achieve the goal of customer-oriented digital transformation and the optimization in selling and production to improve the service quality and lower the working burden on its workers, the Company set up “FPC E-commerce Platform” which combined the Enterprise Resource Planning (ERP) information and AI technology and has been worked online. In addition, in order to provide total solutions to customers, the Company continued to promote product-integration marketing to develop business and create a win-win situation.

Furthermore, to pursue a reasonable profitability, strengthen business and reduce the negative impact from any business challenges, the Company implemented the improvement measures including circular economy development, project improvements promotion, the consumption of water, energy, and the utility usage volume per unit reduction. The Company accomplished 1,226 projects in 2021 with an annual benefit of NTD 1.59bn.

At the same time, the buildings, including the 2 founders' offices in the Kaohsiung plant, the birthplace of Formosa Plastics Group, were registered as monument by the Kaohsiung City Government. The

“ Kaohsiung Y.C. Wang and Y.T. Wang Brothers Park” will be established in the 2.5 hectares original site. The restoration and reuse project of the park is currently underway. The project is expected to complete by 2022 and will be opened to public by district.

The Company, its China Ningbo and the US subsidiaries mainly produce plastics and chemical fiber raw materials.

The sales volume of PVC in 2021 increased by 2% from 2020to 1,670K tons, given (1) the imbalance of supply and demand for global PVC market with supply disruptions from the US snowstorm in February and hurricanes in August 2021 as well as the ongoing shipping bottlenecks and (2) the benefit of more customers of the Company with long-term contract. The sales volume of caustic soda in 2021grew by 13% from 2020 to 1,520K tons, given (1) the growing demand for caustic soda driven by new capacity addition of alumina and nickel mines in Indonesia, (2) the decreased supply and raised PVC prices caused by unusual the US weather and (3) the increased production with the rising ethylene dichloride (EDC) prices and the favorable combined profits from the EDC and caustic soda.

The sales volume of High density polyethylene (HDPE) in 2021 decreased by 10% from 2020 to 474K tons, given (1) market was in oversupply situation with a continued capacity expansion globally, (2) sales volume was dragged down by the decreasing demand for disposable packaging film materials amid global trend of reduction in the usage of plastic materials, (3) the weak market buying impacted by energy policy and stricter controls on commodity prices in China, and (4) the decreasing supply and demand of the subsidiary of HDPE plant in the US affected by shortage of ethylene and limited capacity of delivery vehicles.

Despite the new capacity addition from China peers, the sales volume of polyethylene vinyl acetate (EVA) in 2021 increased by 2% to 294K tons from 2020, given (1) to promote packaging filming with the growing demand for the solar cell encapsulation film, and (2) to boost differentiated products, such as high VA foam material with the increased shoes materials demand. Despite aggressive expansion into Vietnam and Bangladesh market to increase sales volumes of differentiated products,

the sales volume of linear low density polyethylene (LLDPE) in 2021 decreased by 8% to 484K tons from 2020, given (1) a high competition in the LLDPE market owing to new capacity addition from global peers, and (2) the declining productions and sales volume from the US subsidiary’s HDPE plant.

The sales volume of acrylic esters (AE) in 2021 increased by 9% to 573K tons from 2020, given (1) the tight supply with the unexpected shut down from global peers, and (2) the market expansion to the US and Europe due to downstream customers raised inventories levels to prevent supply disruption impacted by unpredictable shipping delivery. The Company’s supply of N-butanol (NBA) is mainly for captive use by AE plants and sales volume in 2021 decreased by 11% to 213K tons from 2020 due to productions suspension for the replacement of catalyst. The sales volume of super absorbent polymer (SAP) in 2021 decreased by 9% to 168k tons from 2020 because of the decreasing shipments to the US and Europe markets on shortage of upstream materials, acrylic acid, and surging freight rate.

The sales volume of Polypropylene (PP) in 2021 decreased by 2% to 957K tons from 2020, because of the part of peers shutdown in the US due to the snowstorm in Texas and the imbalance PP supply and demand in Central and South America. The sales volume of AN in 2021 increased by 11% to 280K tons from 2020 given (1) less shipments from western countries due to unexpected shutdowns from the US and European peers, and (2) the strong demand from downstream ABS products due to the rising of stay-at-home economy. The sales volume of methyl methacrylate (MMA) in 2021 grew by 4% to 85K tons from 2020 as the Company engaged more in the spot market transaction during the unusual supply tightness in the US and Europe markets. The sales volume of epichlorohydrin (ECH) in 2021 decreased by 1% to 96K tons from 2020 due to the low inventory levels in the end of 2020, despite the booming of the wind energy and 5G industries to support demand for downstream product of epoxy.

In terms of capacity expansion, in order to strengthen the competitiveness, the Company aggressively expanded its capacities and conducted debottleneck projects. In Taiwan Complex, the debottleneck project of PP plant in Linyaun with new capacities by 10K tons to 484K tons per annum is expected to be completed by the H1 of 2022. The debottleneck project of PVC plant in Renwu, Linyaun and Mailiao with new capacities by 100K tons to 1,415K tons per annum is expected to be completed in the end of 2022. In addition, the Company has set up a medical material center in Renwu to produce medical-grade compound resin and natural antibacterial materials such as PVC, PE and PP. It is expected to complete and put into production in the end of 2022. The newly built aerogel new material plant in Renwu with an annual production capacity of 12 tons is expected to complete in H1 of 2023.

In Ningbo Complex, the new PDH plant with annual capacity of 600K tons propylene and the EVA debottleneck project with new capacity by 28K to 100K tons per annum is expected to complete and commence production in the end of 2022. In US Complex, the new Texas 1-hexene plant with capacity of 100K tons is planned to be completed in the end of 2025.

Furthermore, in Kaohsiung, the Company’s storage tank in Qianzhen District will be moved to the Phase II intercontinental petrochemical zone. The Company has rent the land and dock from Kaohsiung Taiwan International Ports Corporation for petrochemical usage and will build 12 storage tanks and 1 salt warehouse, which are expected to be completed gradually by the end of 2022.

In terms of equity investments, FPC-USA’s (22.66% owned by the Company) pre-tax income hit historical high at USD 1.37bn in 2021. Despite overall the US economic activities still impacted by pandemic, the rebound in FPC-USA’s earnings was supported by surging average prices of ethylene, propylene, PE, PP and PVC thanks to the rapid rollout of vaccines to drive recovery in business activities, stable increasing demand for petrochemical products and the Texas snowstorm in Q1 2021 to lead to declining supply of overall petrochemical products. Looking into 2022,

given acceleration in global vaccinations, ongoing increase in manufacturing output and the North American petrochemical players’ cost advantages in the procurements of natural gas and raw materials, the operating rate for olefin, PE, PP, PVC and other downstream plants is expected to remain stable while the product prices may correct from the high levels due to the increase in supply. As the equipment inspections has been completed in 2021, FPC-USA’s loss from maintenance shutdown and equipment inspections are expected to narrow significantly to support FPC-USA’s 2022 income achieving the same levels in 2021.

In addition, the loss of Fujian Fuxin Special Steel Co., Ltd. (29.16% owned by the Company) in 2021 has narrowed significantly from 2020 given the order shifting effect, the US and Europe’s easing monetary policies and supports for new infrastructure projects has led to strong growth in export of downstream household appliances and metal products, driving the demand and products prices for stainless steel. It is expected that in 2022, China's policies such as stabilizing the price and supply of commodities and imposing export tariffs will curb steel exports. Moreover, in order to promote carbon neutrality, China’s further implementations in energy policy and power restrictions will lead to more markets volatility. Fujian Fuxin expects to enhance the sales contribution of higher-profit nickel-free differentiated products, such as 400 series and super ferritic. Fujian Fuxin also aims to increase the OEM for hot rolling steel stainless steel and carbon steel and enhance the purchase of carbon steel from Formosa Ha Tinh Steel Corporation. The new cold rolling mill plant project with 300K tpa capacity was put into production from Q1 2022, which is expected to enlarge the synergy of vertical integration and enhance the competitiveness.

In view of the demand in advanced nodes from Taiwan’s semiconductor industry, Formosa Daikin Advanced Chemicals Co., Ltd. (50% owned by the Company) has built up new capacity for hydrofluoric acid by 13K tons to 43K tons annually in Dafa Industrial Park, and has commenced production in Q1 2022. Furthermore, Formosa Tokuyama Advanced Chemicals Co., Ltd. (50% owned by the Company) in Linyuan

with annual capacity of 30K tons of electronic-grade IPA has been put into production in H1 2022.

In terms of research and development, the Company spent NTD 2.7bn on R&D in 2021, accounted for 1% of the Company’s revenues. These R&D expenses were mainly spent on new formulation development, production process improvement, product quality upgrade, energy consumption saving, and human resources cultivation to increase added value and lower cost. In 2021, the Company completed 56 R&D projects with an annual benefit of NTD 210mn. Meanwhile, the Company conducted R&D on advanced production technique and to commercialize specialty products including zwitterionic anti-fouling compound resin, green plastic, environmental friendly plasticizer-free PVC, high-fluidity HDPE fiber material, electronic grade packaging EVA film, high-performance BOPE packaging material, TC780 modulus reinforced carbon fiber, dry-jet wet-spinning ultra-high-strength carbon fiber, low-odor high-fluid SAP, post-SAP neutralization process, biodegradable PP, anti-bacterial oyster shell powder PP and high fluidity and high rigidity PP automotive materials, which has achieved good results.

In order to enhance the competitiveness, the Company actively invested in the key technology development and applied for both domestic and international patent. In 2021, the Company received approval on 21 patents, and had a total of 207 effective patents as of the end of 2021. Laying on the foundation of continuingly improving R&D capabilities, the Company accelerates the development of scratch resistance, flame resistance, toughness, gas barrier, dielectric products through its new high-end equipment center in Mailiao, coupled with virtual laboratory and talents in production process simulation. Meanwhile, in response to the new normal post the pandemic, the Company set up medical materials center and continued to work with industry experts and academic area to specialize ultra-high-performance PP melt-blown filter materials and zwitterionic anti-fouling compound resin, as well as natural anti-bacterial and beauty-related green products.

Among them, the “Capture and Reuse of Flue Gas “, which was a joint project with academic research institutions, was qualified to receive the subsidy from Ministry of Economic Affairs in 2019. It was put into trial operation in October 2021 and expected to complete the testing project in H1 2022. At the same time, in order to support the development in 5G industry in Taiwan, the Company will cooperate with Industrial Technology Research Institute and downstream companies to form a 5G industry alliance. In addition, the Company was qualified for the innovative R&D of Materials program “Polyolefin Technology Development Plan for 5G Base Stations” by Ministry of Economic Affairs in June 2021, and will expand its R&D towards products such as 5G and 6G base station radomes, antenna elements and composite cables.

On the operational safety and environmental protection front, the Company always puts emphasis on industry developments and environmental protection equally. As of the end of 2021, the accumulated investments on operational safety, environmental protection, and firefighting reached NTD 26.8bn, which was mainly spent on controlling pollution, energy saving, waste and greenhouse gases reduction, and operational safety and firefighting improvement. The Company’s pollution treatment and emissions are better than national regulatory standards.

In 2021, there were 4 business units praised by competent authority. Among them, besides the fact that the carbon fiber plant in Mailiao was awarded the Excellent Manufacturer of Greenhouse Gas Reduction by the Industrial Development Bureau of the Ministry of Economic Affairs, Haifeng plant and Mailiao ECH plant were praised by Yunlin County for strong performance on occupational safety and health. In addition, the Company was also awarded as Green Purchasing Excellent Entity by the Taipei Environmental Protection Bureau.

In terms of water and energy conservation and greenhouse emissions reduction, in 2021, the Company accomplished 1,073 improvement projects. Total water saved amounted to 3,280 tons/day, while greenhouse gas emissions reduction reached 309K tons/year. Other ongoing 1,100 improvement projects would further conserve water by 9,687 tons/day and

reduce greenhouse gas emissions by 243K tons/year. According to the results announced by Carbon Disclosure Project (CDP) in 2021, the Company was ranked “A-” in climate change assessment and “A” in water resources assessment. Both achievements were among the top rankings within many well-known international chemical companies, which shows that the Company’s efforts in energy saving, emission reduction and circular economy in response to climate change have achieved considerable results.

Besides, in order to enhance operational safety, prevent occupational disasters, and ensure the safety and health of labors, the Company not only continued to conduct overall equipment inspection, implement Standard Operating Procedures (SOP), Management of Change (MOC) and Process Hazard Analysis (PHA) operations, and strengthen inspections of machinery and equipment for improvement, but also introduced AI such as Limited Space Image Recognition Technology to assist construction safety, implement daily safety and health inspections of the construction sites before, during and after construction to prevent workers’ unsafe operational behaviors, and digitalize the supervision documents to improve the quality and efficiency of sites management. Meanwhile, the Company has developed smart wearable devices to assist inspections and maintenance and monitor the health conditions of workers. The Company also introduced AI smart detection system for pipeline leakage at Renwu Complex to 24-hour monitor key production process areas and effectively detect the location of VCM and chlorine leaks. This detection system will be installed in all the other complexes to ensure the safety of employee and equipment, which are expected to help employees to work in a safe and healthy workplace and ensure the stable and zero-accident operation for the Company.

In view of the increasingly stringent environmental regulations, the Company continues to improve the elimination of white smoke from the chimneys of Renwu Complex and to promote carbon neutrality and zero discharge of wastewater in each Complex. At the same time, each plant is reducing volatile organic compounds (VOCs) and streamlining equipment

components to gradually replace the low-leakage equipment components. This is also supplemented by the application of infrared detector (GasFinder) to strengthen autonomous inspections for a friendly environment.

2. Business Performance:

The consolidated sales of NTD 273.59bn in 2021 increased by NTD 87.78bn from NTD 185.81bn in 2020. Operating income was NTD 60.16bn with a 22% of operating margin after deducting COGS of NTD197.43bn and of NTD 15.99bn. Plus operating expenses non-operating income of NTD 25.79bn (included equity investment income of NTD 23.45bn), the pre-tax profit of NTD 85.95bn in 2021 increased by 256% from 2020.

3. 2022 Business Performance Target and Outlook:

Looking into 2022, the global economic activities is expected to return to normal and sustain the same growth momentum in 2021 with the gradual normalization of COVID-19 prevention measures by countries, the rising vaccinations globally and the support of fiscal stimulus policies and infrastructures projects by the US, European countries, Japan and India. Nevertheless, the mounting pressure from ongoing inflations, gradually tighter monetary policies and higher possibility of rate hikes have been weighing on the global economy and slowing down the growth momentum in 2022 following the strong growth in 2021. According to the latest forecast by the International Monetary Fund (IMF), the global economy will grow by 3.6% in 2022, still above the average long-term growth trend.

However, the spread of the new variant COVID-19 virus has led to a more severely global pandemic. The resumption of COVID-19 control measures may weaken the rebound of economy growth. Besides, the risks from rising inflation, the impact on global economy from the monetary policies shifts in the US and Europe, supply chains bottlenecks, uncertainties from the follow-up of China-US trade tension, extreme weather, the impact on the energy price by the conflict between Russia and

Ukraine and geopolitical tensions are still need to be closely monitored in the future.

In terms of supply, IHS forecasts that the global ethylene capacity will increase around 13.49 million tons in 2022, and China and US in total account for 80% of the new capacity. In terms of demand, based on the global ethylene demand growth of 1.0x of GDP growth, incremental demand should only be 8.7 million tons in 2022. While polypropylene net capacity increase will be 9.69 million tons in 2022, mainly in China, by 7.3 million tons. Based on 1.2x of GDP growth, the incremental polypropylene demand should only be 7.1 million tons in 2022. The global ethylene and propylene market will be oversupplied.

Furthermore, after the last upcycle of petrochemical industry during 2015-2019, a large number of new capacities of ethylene, propylene and downstream derivatives in China and the US resulted in market oversupply in 2020. On top of this, the impact of COVID-19 in 2020 on business activities has weighed on demand and led to the decline in petrochemical industry. In 2021, the competition pressure from Asian low-cost coal-based petrochemical peers was eased thanks to the pandemic-triggered labor shortage, shipping bottlenecks, the surge in energy & commodity prices due to extreme weather and carbon neutrality trend, and the energy policy in China leading to decreasing supply of coal-based petrochemical products or lower outputs from several petrochemical producers affected by power-outage. Meanwhile, with the popularity of vaccination, sufficient supply of liquidity and economy recovery, strong demand for petrochemical products led to the historically prosperous year for the industry in 2021. Looking into 2022, the upcycle is expected to sustain on the back of resilient demand for petrochemical products and the ongoing supply disruptions due to COVID-19, shipping bottlenecks and increasing awareness on carbon neutrality in countries.

Moreover, in response to carbon peaking and carbon neutrality goals as well as the surging coal prices on supply shortage, China has disclosed action plans to control energy consumption intensity and total amount, and set control targets and review the effectiveness for each administrative area.

The implementation of electricity and production restrictions will not only limit the operating rate for coal-based petrochemical plants, reduce the outputs and exports of petrochemical products, but also push up the production cost and thus further support the pricing for petrochemical products in Asia market with the marketization of electricity prices and lingering shortage of energy supply. In the long term, to achieve carbon peaking and carbon neutrality goals, China will accelerate the pace to phase out inefficient petrochemical plants and industry consolidation. Together with the decreasing new capacity from the US peers and their preference to export to regions with higher ASPs, such as Central and South America and Europe market, the product sales of the Company are expected to benefit from the lesser pressure from competition.

In 2022, in view of carbon transition wave globally, countries have successively announced their commitments in carbon neutrality. In light of the inevitable trend of carbon management, the Company realized it has been increasingly important to respond to the decarbonization trend in time. For the development of sustainability, the Company will use AI technology to promote energy saving and carbon reduction, improvement in low-carbon productions, energy transition, circular economy and other ESG strategies. Meanwhile, the Company will engage more in the developments of carbon reductions, more R&D for environmentally friendly products such as plastic recycling, biodegradable and green plastics in order to create diversified values and lead the Company towards the goal of “carbon neutrality by 2050”, and join hands with upstream and downstream supply chains to create a zero-carbon future.

Meanwhile, the Company aims to focus on the development of AI and innovation through the acceleration in AI transformation and digitalization and build digital ecosystem for operation management to optimize process, improve output and quality, reduce raw material and energy consumption, and ensure workplace safety and environmental protection. Moreover, considering health care, technological innovation and new economy trend post the pandemic, the Company commits to developing innovative and high-value materials and processing

technologies, and exploring the applications of anti-bacterial oyster shell powder through the collaboration with investee, Puriblood Medical Co., Ltd. The partnership allows the Company to use zwitterionic anti-fouling technology to develop medical-grade compound resin, and further apply it

to the fields of consumer, medical and industrial supplies. This development is aimed not only to enhance the added value of products, but also to make contributions in the improvement of social well-being.

Moreover, there will be more days of maintenance shutdown for ethylene capacity in Taiwan in 2022 than which in 2021. The Company expects that the supply of ethylene and propylene feedstock will decrease, and will seek for imports to cover the shortfall in raw material, aiming to reach the target of “full production and sales”. Meanwhile, the Company will conduct deep-dive review on petrochemical plant management, and continue to promote a comprehensive inspection on equipment and the implementation of Process Safety Management (PSM), in order to manufacture under zero accidents. Besides, in response to the regionalization trend of the supply chain caused by COVID-19, the Company will not only continue to expand differentiated product markets, but also will accelerate digital transformation by using AI technology to optimize production & sales and introducing smart manufacturing, and through remote marketing to actively expand into new customers and new markets in an attempt to enhance the Company’s long-term competitiveness. The Company will also aggressively promote the capacity expansion and debottleneck projects in Taiwan and overseas. Through the efforts above, the Company expects to strengthen its business in preparation of any new challenge and threat, and to make another year of strong earnings performance.

Chairman: Jason Lin President: Jason Lin In-charge Accountant: Chia-Tse Chang

Formosa Plastics Corporation

Audit Committee’ Review Report

The Board of Directors has prepared the Company’s 2021 Business Report, Financial Statements, including Consolidated and Individual Financial Statement, and Proposal for Profits Distribution. The CPA firm of KPMG was retained to audit Formosa Plastics Corporation’s Financial Statements and has issued an audit report relating to Financial Statements. The Business Report, Financial Statements, and Proposal for Profits Distribution have been reviewed and determined to be correct and accurate by the Audit Committee members of Formosa Plastics Corporation. According to the Securities and Exchange Act and the Company Act, we hereby submit this report. Please be advised accordingly.

Formosa Plastics Corporation Chairman of the Audit Committee: Chi-Lin, Wei

March 10, 2022

Ratification Items Proposal 1

Proposal: For approval of the 2021 Business Report and Financial Statements as required by the Company Act.

Proposed by the Board of Directors

Explanation:

1.The preparation of the Company’s 2021 Consolidated and Individual Financial Statements were completed. The aforementioned Financial Statement were reviewed by the Audit Committee and approved by the Board Meeting on March 10, 2022, and audited by independent auditors, Mr. Astor Kou and Mr. Winston Yu, of KPMG. The aforesaid Financial Statements together with the Business Report were reviewed by the Audit Committee, which the Audit Committee’ Review Report is presented.
2.For the aforementioned Business Report, please refer to page 5 through page 20 of the Meeting Handbook. As for the Financial Statements, please refer to page 38 through page 45 of the Handbook. Please approve the Business Report and the Financial Statements.

Resolution:

Ratification Items Proposal 2

Proposal: For approval of the proposal for distribution of 2021 Profits as required by the Company Act.

Proposed by the Board of Directors

Attachment:

Please refer to page 46 of the Handbook for the Statement of Profits Distribution, which has been reviewed by the Audit Committee members of Formosa Plastics Corporation and approved by the Board of Directors on March 10, 2022.

Resolution:

Discussion Items Proposal 1

Proposal: Amendment to the Articles of Incorporation of the Company. Please discuss and resolve.

Proposed by the Board of Directors Explanation: To conform to the needs of commercial practice, certain Articles of Incorporation of the Company have been amended. The comparison table for articles before and after amendment is hereby attached. Please determine whether the amendments are reasonable.

Article	Current Article	Amended Article	Reason for Amendment
Article 20	The Board shall consist of elevento fifteen directors. The election of directors will be made by nomination. Shareholders may elect the directors from the candidates list. The total registered shares	The Board shall consist of nineto fifteen directors. The election of directors will be made by nomination. Shareholders may elect the directors from the candidates list. (below omitted)	To conform to the needs of commercial practice, the Company proposes to adjust the number of directors to increase flexibility and delete the regulation about the registered shares held by the directors.
	held by the directors shall not be less than a certain quorum of the company’s total shares. The calculation of quorum shall conform to the method instructed by the competent authority. (below omitted)
Article 21	The directors shall elect at least three from among themselves but not more than one third of all the directors to serve as the executive directors,	The directors shall elect at least three from among themselves but not more than one third of all the directors to serve as the executive directors,	To add the executive director election process, and the election of the Vice Chairman so as to conform to

	including one independent director. The executive directors shall elect one of them to become the Chairman of the Board and another person to be the Vice Chairman. (below omitted)	including one independent director, by a majority vote at a meeting	the needs of commercial practice.
		of the Board of Directors attended by over two-thirds of the directors.The executive directors shall elect one of them to become the Chairman of the Board andmay electanother person to be the Vice Chairmanin accordance with the same manner set
		forth in the preceding Paragraph. (below omitted)
Article 40	If there are any earnings after final account settlement, the Company shall pay off the applicable taxes, compensate the accrued deficit and retain 10% as legal reserve and an additional amount as special reserve before distributing dividends. If there are any remaining earnings of such year, the Board may, combining the undistributed earnings of previous years, propose a shareholder bonus plan andsubmit for the approval in a general	If there are any earnings after final account settlement, the Company shall pay off the applicable taxes, compensate the accrued deficit and retain 10% as legal reserve and an additional amount as special reserve before distributing dividends. If there are any remaining earnings of such year, the Board may, combining the undistributed earnings of previous years, propose a shareholder bonus plan, andis authorized to distribute	To conform to the needs of commercial practice, the Company proposes to amend the procedure of cash dividend distribution in compliance with Company Act.

	shareholders meeting. (below omitted)	dividends paid in cash after a resolution has been
		adopted by a majority vote at a meeting of the board of directors attended by over two-thirds of the directors; and in addition thereto a report of such distribution shall be submitted to the shareholders’meeting. The dividends paid in stock shall be submitted for the approval in a shareholders’meeting. (below omitted)
Article 42	(Omitted)	Add “sixty-fourth amendment on June 9, 2022” to the existing Article.	To amend the above articles, the Company encloses the date of the 64th amendment.

Resolution:

Discussion Items Proposal 2

Proposal: Amendment to Procedures for Acquisition or Disposal of Assets of the Company. Please discuss and resolve.

Proposed by the Board of Directors To comply with the requirements provided in the order Jin-Guan-Zheng-Fa-Zi No. 1110380465 dated January 28, 2022 by the Financial Supervisory Commission, certain articles of Procedures for Acquisition or Disposal of Assets of the Company have been amended. The comparison table for articles before and after amendment is hereby attached. Please determine whether the amendments are reasonable.

Article	Current Article	Amended Article	Reason for Amendment
Article 7	In acquiring or disposing of real property, equipment, or right-of-use assets thereof where the transaction amount reaches 20 percent of the Company's paid-in capital or NTD 300 million or more, the Company, unless transacting with a domestic government institution, engaging others to build on its own land, engaging others to build on rented land, or acquiring or disposing of equipment or right-of-use assets thereof for business use, shall obtain an appraisal report prior to the date of occurrence of the event from a professional appraiser and shall further complywith the following	In acquiring or disposing of real property, equipment, or right-of-use assets thereof where the transaction amount reaches 20 percent of the Company's paid-in capital or NTD 300 million or more, the Company, unless transacting with a domestic government institution, engaging others to build on its own land, engaging others to build on rented land, or acquiring or disposing of equipment or right-of-use assets thereof for business use, shall obtain an appraisal report prior to the date of occurrence of the event from a professional appraiser and shall further complywith the following	Amended to comply with the order Jin-Guan-Zheng -Fa-Zi No. 1110380465 dated January 28, 2022 by the Financial Supervisory Commission.

provisions:

Where due to special circumstances it is necessary to give a limited price, specified price, or special price as a reference basis for the transaction price, the transaction shall be proposed for approval in advance by the Board of Directors; the same procedure shall also be followed for any subsequent changes to the terms and conditions of the transaction.
Where due to special circumstances it is necessary to give a limited price, specified price, or special price as a reference basis for the transaction price, the transaction shall be proposed for approval in advance by the Board of Directors; the same procedure shall also be followed for any subsequent changes to the terms and conditions of the transaction.
Where the transaction amount is NTD 1 billion or more, appraisals from two or more professional appraisers shall be obtained.
Where the transaction amount is NTD 1 billion or more, appraisals from two or more professional appraisers shall be obtained.
Where any one of the following circumstances applies with respect to the professional appraiser's appraisal results, unless all the appraisal results for the assets to be acquired are higher than the transaction amount, or all the appraisal results for the assets to be disposed of are lower than the transaction amount, a certified public accountant shall be engaged to perform
Where any one of the following circumstances applies with respect to the professional appraiser's appraisal results, unless all the appraisal results for the assets to be acquired are higher than the transaction amount, or all the appraisal results for the assets to be disposed of are lower than the transaction amount, a certified public accountant shall be engaged to perform

the appraisal in accordance the appraisal and render a with the provisions of specific opinion regarding Statement of Auditing the reason for the Standards No. 20 published discrepancy and the by the Accounting appropriateness of the Research and Development transaction price: Foundation of Republic of China (ARDF) and render a specific opinion regarding the reason for the discrepancy and the appropriateness of the transaction price: (1) The discrepancy (1) The discrepancy between the appraisal between the appraisal result and the result and the transaction amount is 20 transaction amount is 20 percent or more of the percent or more of the transaction amount. transaction amount. (2) The discrepancy (2) The discrepancy between the appraisal between the appraisal results of two or more results of two or more professional appraisers professional appraisers is 10 percent or more of is 10 percent or more of the transaction amount. the transaction amount. 4. No more than 3 months 4. No more than 3 months may elapse between the may elapse between the date of the appraisal report date of the appraisal report issued by a professional issued by a professional appraiser and the contract appraiser and the contract execution date; provided, execution date; provided, where the publicly where the publicly announced current value announced current value for the same period is used for the same period is used and not more than 6 and not more than 6 months have elapsed, an months have elapsed, an

	opinion may still be issued by the original professional appraiser.	opinion may still be issued by the original professional appraiser.
Article 8	The Company acquiring or disposing of securities shall, prior to the date of occurrence of the event, obtain financial statements of the issuing company for the most recent period, certified or reviewed by a certified public accountant, for reference in appraising the transaction price, and if the dollar amount of the transaction is 20 percent of the Company's paid-in capital or NTD 300 million or more, the Company shall additionally engage a certified public accountant prior to the date of occurrence of the event to provide an opinion regarding the reasonableness of the transaction price.If the CPA needs to use the report of an expert as evidence, the CPA shall do so in accordance with	The Company acquiring or disposing of securities shall, prior to the date of occurrence of the event, obtain financial statements of the issuing company for the most recent period, certified or reviewed by a certified public accountant, for reference in appraising the transaction price, and if the dollar amount of the transaction is 20 percent of the Company's paid-in capital or NTD 300 million or more, the Company shall additionally engage a certified public accountant prior to the date of occurrence of the event to provide an opinion regarding the reasonableness of the transaction price. This requirement does not apply, however, to publicly quoted prices of securities that have an active market, or where otherwise provided by regulations of the securities competent authority.	Amended to comply with the order Jin-Guan-Zhen g-Fa-Zi No. 1110380465 dated January 28, 2022 by the Financial Supervisory Commission.
	the provisions of Statement of
	Auditing Standards No. 20 published by the ARDF.This requirement does not apply, however, to publicly quoted prices of securities that have an active market, or where otherwiseprovided by

	regulations of the securities competent authority.
Article 9	In acquiring or disposing of intangible assets or right-of-use assets thereof or membership cards where the transaction amount reaches 20 percent or more of the company's paid-in capital or NTD 300 million or more, the Company, unless transacting with a domestic government institution, shall obtain a CPA’s opinion on the reasonableness of the transaction price prior to the date of occurrence of the event.The CPA shall comply with the provisions of Statement of Auditing Standards No. 20 published by the Accounting Research and Development Foundation.	In acquiring or disposing of intangible assets or right-of-use assets thereof or membership cards where the transaction amount reaches 20 percent or more of the company's paid-in capital or NTD 300 million or more, the Company, unless transacting with a domestic government institution, shall obtain a CPA’s opinion on the reasonableness of the transaction price prior to the date of occurrence of the event.	Amended to comply with the order Jin-Guan-Zhen g-Fa-Zi No. 1110380465 dated January 28, 2022 by the Financial Supervisory Commission.
Article 14	When the Company intends to acquire or dispose of real property or right-of-use assets thereof from or to a related party, or when it intends to acquire or dispose of assets other than real property or right-of-use assets thereof from or to a related party and the transaction amount reaches 20 percent or more of paid-in capital, 10 percent or more of the Company's total	When the Company intends to acquire or dispose of real property or right-of-use assets thereof from or to a related party, or when it intends to acquire or dispose of assets other than real property or right-of-use assets thereof from or to a related party and the transaction amount reaches 20 percent or more of paid-in capital, 10 percent or more of the Company's total	Amended to comply with the order Jin-Guan-Zhen g-Fa-Zi No. 1110380465 dated January 28, 2022 by the Financial Supervisory Commission.

	assets, or NTD 300 million or more, except in trading of domestic government bonds or bonds under repurchase and resale agreements, or subscription or repurchase of money market funds issued by domestic securities investment trust enterprises, the Company may not proceed to enter into a transaction contract or make a payment until the following matters have been approved by the Board of Directors: 1. The purpose, necessity and anticipated benefit of the acquisition or disposal of assets. 2. The reason for choosing the related party as a trading counterparty. 3. With respect to the acquisition of real property or right-of-use assets thereof from a related party, information regarding appraisal of the reasonableness of the preliminary transaction terms in accordance with Article 15 through 17. 4. The date and price at which the related party originally acquired the real property, the original trading	assets, or NTD 300 million or more, except in trading of domestic government bonds or bonds under repurchase and resale agreements, or subscription or repurchase of money market funds issued by domestic securities investment trust enterprises, the Company may not proceed to enter into a transaction contract or make a payment until the following matters have been approved by the Board of Directors: 1. The purpose, necessity and anticipated benefit of the acquisition or disposal of assets. 2. The reason for choosing the related party as a trading counterparty. 3. With respect to the acquisition of real property or right-of-use assets thereof from a related party, information regarding appraisal of the reasonableness of the preliminary transaction terms in accordance with Article 15 through 17. 4. The date and price at which the related party originally acquired the real property, the original trading

	counterparty, and that trading counterparty's relationship to the Company and the related party. 5. Monthly cash flow forecasts for the year commencing from the anticipated month of signing of the contract, and evaluation of the necessity of the transaction, and reasonableness of the funds utilization. 6. An appraisal report from a professional appraiser or a CPA's opinion obtained in compliance with the preceding article. 7. Restrictive covenants and other important stipulations associated with the transaction.	counterparty, and that trading counterparty's relationship to the Company and the related party. 5. Monthly cash flow forecasts for the year commencing from the anticipated month of signing of the contract, and evaluation of the necessity of the transaction, and reasonableness of the funds utilization. 6. An appraisal report from a professional appraiser or a CPA's opinion obtained in compliance with the preceding article. 7. Restrictive covenants and other important stipulations associated with the transaction. Where the transaction in paragraph 1 of the Company or any subsidiaries that are not public companies and the
		transaction amount reaches 10
		percent or more of the Company's total assets, the Company or any subsidiaries that are not public companies
		may not proceed to enter into
		a transaction contract or make
		a payment until the documents in paragraph 1

	The calculation of the transaction amounts referred to in the preceding paragraph shall be made in accordance with paragraph 2 of Article 28 herein, and "within the preceding year" as used herein refers to the year preceding the date of occurrence of the current transaction. Items that have been approved by the Board of Directors need not be counted toward the transaction amount. (below omitted)	have been submitted for the approval in the Shareholders’
		Meeting of the Company. However, this provision does
		not apply to the transaction between the Company and its
		parent or subsidiaries, or between its subsidiaries. The calculation of the transaction amounts referred to inparagraph 1 andthe preceding paragraph shall be made in accordance with paragraph 2 of Article 28 herein, and "within the preceding year" as used herein refers to the year preceding the date of occurrence of the current transaction. Items that have been approved bythe Shareholders’Meeting or the Board of Directors need not be counted toward the transaction amount. (below omitted)
Article 28	Under any of the following circumstances, the Company acquiring or disposing of assets shall publicly announce and report the relevant information on the securities competent authority's designated website in the appropriate format as prescribed byregulations	Under any of the following circumstances, the Company acquiring or disposing of assets shall publicly announce and report the relevant information on the securities competent authority's designated website in the appropriate format as prescribed byregulations	Amended to comply with the order Jin-Guan-Zhen g-Fa-Zi No. 1110380465 dated January 28, 2022 by the Financial Supervisory

within 2 days commencing immediately from the date of occurrence of the event:

Commission.

within 2 days commencing immediately from the date of occurrence of the event:

Acquisition or disposal of real property or right-of-use assets thereof from or to a related party, or acquisition or disposal of assets other than real property or right-of-use assets thereof from or to a related party where the transaction amount reaches 20 percent or more of paid-in capital, 10 percent or more of the Company's total assets, or NTD 300 million or more; provided, this shall not apply to trading of domestic government bonds or bonds under repurchase and resale agreements, or subscription or repurchase of money market funds issued by domestic securities investment trust enterprises.
Acquisition or disposal of real property or right-of-use assets thereof from or to a related party, or acquisition or disposal of assets other than real property or right-of-use assets thereof from or to a related party where the transaction amount reaches 20 percent or more of paid-in capital, 10 percent or more of the Company's total assets, or NTD 300 million or more; provided, this shall not apply to trading of domestic government bonds or bonds under repurchase and resale agreements, or subscription or repurchase of money market funds issued by domestic securities investment trust enterprises.
Merger, demerger, acquisition, or assignment of shares.
Merger, demerger, acquisition, or assignment of shares.
Losses from derivatives trading reaching the limits on aggregate losses or losses on individual contracts set out in the
Losses from derivatives trading reaching the limits on aggregate losses or losses on individual contracts set out in the

procedures adopted by the Company.

Where
Where

equipment/machinery or right-of-use assets thereof for business use are acquired or disposed of, and furthermore the trading counterparty is not a related party, and the transaction amount is more than NTD 1 billion.

Where land is acquired under an arrangement on engaging others to build on the company's own land, engaging others to build on rented land, joint construction and allocation of housing units, joint construction and allocation of ownership percentages, or joint construction and separate sale, and furthermore the trading counterparty is not a related party, and the amount the Company expects to invest in the transaction is more than NTD 500 million. 6. An asset transaction other than any of those referred to in the preceding five subparagraphs, a disposal of receivables by a financial institution, or an
Where land is acquired under an arrangement on engaging others to build on the company's own land, engaging others to build on rented land, joint construction and allocation of housing units, joint construction and allocation of ownership percentages, or joint construction and separate sale, and

furthermore the trading counterparty is not a related party, and the amount the Company expects to invest in the transaction is more than NTD 500 million.

An asset transaction other than any of those referred to in the preceding five subparagraphs, a disposal of receivables by a financial institution, or an

	investment in the mainland China area where the transaction amount reaches 20 percent or more of paid-in capital or NTD 300 million or more, provided this shall not apply to the following circumstances: (1) Trading of domestic government bonds. (2) Trading of bonds under repurchase/resale agreements or the subscription or repurchase of money market funds issued by domestic securities investment trust enterprises. (below omitted)	investment in the mainland China area where the transaction amount reaches 20 percent or more of paid-in capital or NTD 300 million or more, provided this shall not apply to the following circumstances: (1) Trading of domestic government bondsor foreign government bonds with a sovereign rating not lower than the sovereign rating of the R.O.C. (2) Trading of bonds under repurchase/resale agreements or the subscription or repurchase of money market funds issued by domestic securities investment trust enterprises. (below omitted)

Resolution:

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) FORMOSA PLASTICS CORPORATION AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars, Except for Earnings Per Common Share)

4000
Operating revenue (Notes 6(r) and 7)
5000
Operating costs (Notes 6(e)(g)(h)(n)(s) and 7)
Gross profit from operations
Operating expenses (Notes 6(c)(g)(h)(n)(s) and 7):
6100
Selling expenses
6200
Administrative expenses
6300
Research and development expenses
6450
Expected credit loss (gain)
Total operating expenses
Operating income
Non-operating income and expenses (Notes 6(f)(g)(m)(t) and 7):
7100
Interest income
7010
Other income
7020
Other gains and losses
7050
Finance costs
7060
Share of profit of associates and joint ventures accounted for using equity method
Total non-operating income and expenses
Profit from continuing operations before income tax
9300
Less: Income tax expenses (Note 6(o))
Profit(Loss)
8300
Other comprehensive income (loss): (Note 6(o)(p))
8310
Items that may not be reclassified subsequently to profit or loss:
8311
Losses on remeasurements of defined benefit plans
8316
Unrealized gains (losses) from investments in equity instruments measured at fair value
through other comprehensive income(loss)
8320
Share of other comprehensive income of associates and joint ventures accounted for using
equity method, components of other comprehensive income that will not be reclassified
8349
Income tax related to components of other comprehensive income that will not be reclassified
to profit or loss
8360
Items that may be reclassified subsequently to profit or loss:
8361
Exchange differences on translation of foreign financial statements
8370
Share of other comprehensive income of associates and joint ventures accounted for using
equity method, components of other comprehensive income that will be reclassified to
profit or loss
8399
Income tax related to components of other comprehensive income that will be reclassified to
profit or loss
Components of other comprehensive income that will be reclassified to profit or loss
8300
Other comprehensive income (loss)
8500
Total comprehensive income (loss)
Basic earnings per share(NT dollars) (Note 6(q))

2021

See accompanying notes to consolidated financial statements.

(English Translation of Financial Statements and Report Originally Issued in Chinese) FORMOSA PLASTICS CORPORATION

Statements of Comprehensive Income

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars , Except for Earnings Per Common Share)

4000
Operating revenue (Notes 6(r) and 7)
5000
Operating costs (Notes 6(e)(g)(h)(n)(s) and 7)
Gross profit from operations
5920
Less:Realized loss on from sales (note)
Gross profit from operations
Operating expenses (Notes 6(c)(g)(h)(n)(s) and 7):
6100
Selling expenses
6200
Administrative expenses
6300
Research and development expenses
6450
Expected credit loss (gain)
Total operating expenses
Operating income
Non-operating income and expenses (Notes 6(f)(n)(t) and 7):
7100
Total interest income
7010
Other income
7020
Other gains and losses
7050
Finance costs
7070
Share of profit of associates and joint ventures accounted for using equity
method
Total non-operating income and expenses
Profit from continuing operations before income tax
6400
Less: Income tax expenses (Note 6(o))
Profit
8300
Other comprehensive income (loss) (Note (n)(o)(p)):
8310
Items that may not be reclassified subsequently to profit or loss:
8311
Losses on remeasurements of defined benefit plans
8316
Unrealized gains (losses) from investments in equity instruments measured
at fair value through other comprehensive income
8330
Share of other comprehensive income of subsidiaries, associates and joint
ventures accounted for using equity method, components of other
comprehensive income that will not be reclassified
8349
Income tax related to components of other comprehensive income that will
not be reclassified to profit or loss
8360
Items that may be reclassified subsequently to profit or loss:
8361
Exchange differences on translation of foreign financial statements
8380
Share of other comprehensive income of subsidiaries, associates and joint
ventures accounted for using equity method, components of other
comprehensive income that will be reclassified to profit or loss
8399
Income tax related to components of other comprehensive income that will
be reclassified to profit or loss
8300
Other comprehensive income (loss)
Total comprehensive income (loss)
9710
Basic earnings per share (NT dollars) (Note 6(q))

2021

See accompanying notes to financial statements.

December 31, 2021 December 31, 2020	Amount % Amount %	$ 4,484,676 1 15,356,724 3 2,099,824 - 16,996,824 4 7,768,898 1 6,012,635 1 8,201,747 1 7,102,565 1 10,352,387 2 3,481,665 1 15,789,544 3 1,705,923 - 23,879 - 21,452 - 9,395,685 2 2,898,401 1 - - 2,000,000 - 16,424,576 3 12,678,838 3 74,541,216 13 68,255,027 14 36,113,569 7 38,012,054 8 4,187,592 1 1,569,776 - 19,164,020 4 17,703,674 4 123,728 - 121,923 - - - 14,396,540 3 6,159,185 1 6,560,931 2 199,338 - 124,358 - 65,947,432 13 78,489,256 17 140,488,648 26 146,744,283 31 63,657,408 12 63,657,408 13 11,770,685 2 11,742,124 2 67,780,313 12 65,791,185 14 71,352,267 13 68,879,676 14 107,126,265 20 55,559,015 12 246,258,845 45 190,229,876 40 81,503,336 15 66,906,732 14 403,190,274 74 332,536,140 69 $ 543,678,922 100 479,280,423 100

Amount % Amount % Liabilities and Equity	Current liabilities:	13,715,454 3 14,145,110 3 2100 Short-term borrowings (Notes 6(i))	3,793,399 1 3,888,883 1 2110 Short-term notes and bills payable (Note 6(j))	2170 Accounts payable	109,316,870 20 102,218,948 21 2180 Accounts payable�related parties (Note 7)	5,806,161 1 2,148,261 1 2200 Other payables	15,109,576 3 10,372,878 2 2220 Other payables�related parties (Note 7)	4,688,703 1 3,439,213 1 2280 Current lease liabilities (Note 6(m))	1,365,955 - 936,148 - 2321 Current portion of bonds payable (Note 6(l))	7,362,620 1 6,499,202 1 2322 Current portion of long-term borrowings (Notes 6(k) and 8)	24,525,572 4 16,681,271 4 2399 Other current liabilities (Note 7)	3,577,911 1 5,305,846 1 Total current liabilities	189,262,221 35 165,635,760 35 Non-Current liabilities:	2530 Bonds payable (Note 6(l))	24,910,619 5 18,647,715 4 2540 Long-term borrowings (Note 6(k) and 8).	218,625,143 40 193,979,093 40 2570 Deferred income tax liabilities (Note 6(o))	97,343,039 18 86,785,954 18 2580 Non-current lease liabilities (Note 6(m))	1,133,986 - 1,147,126 - 2622 Long-term accounts payable to related parties (Note 7)	623,165 - 590,274 - 2640 Net defined benefit liabilities-non-current	1,962,887 - 2,859,857 1 2670 Other non-current liabilities (Note 6(f))	9,817,862 2 9,634,644 2 Total non-current liabilities	354,416,701 65 313,644,663 65 Total liabilities	543,678,922 100 479,280,423 100 Total liabilities and equity
		$																					$
Assets	Current assets:	Cash and cash equivalents (Note 6(a))	Current financial assets at fair value through profit or loss (Note 6(b))	Current financial assets at fair value through other comprehensive income (Note	6(b))	Notes receivable (Notes 6(c)(r))	Accounts receivable, net (Notes 6(c)(r))	Accounts receivable�related parties (Notes 6(c)(r) and 7)	Other receivables (Note 6(d))	Other receivables�related parties (Notes 6(d) and 7)	Inventories (Note 6(e))	Other current assets	Total current assets	Non-current assets:	Financial assets at fair value through other comprehensive income-non-current (Note 6(b))	Investments accounted for using equity method (Note 6(f))	Property, plant and equipment (Note 6(g), 7 and 8)	Right-of-use assets (Note 6(h))	Intangible assets (Note 6(o))	Deferred income tax assets	Other non-current assets (Note 8)	Total non-current assets	Total assets
		1100	1110	1120		1150	1170	1180	1200	1210	130X	1470			1517	1550	1600	1755	1780	1840	1900
													40

					December 31, 2020	Amount %		14,627,108 3	16,996,824 4	3,563,593 1	6,825,377 1	2,636,727 1	1,080,287 -	21,452 -	2,898,401 1	2,000,000 -	10,073,563 2	60,723,332 13		38,012,054 8	17,703,412 4	121,923 -	6,560,931 2	71,238 -	62,469,558 14	123,192,890 27		63,657,408 14	11,742,124 3		65,791,185 14	68,879,676 15	55,559,015 12	190,229,876 41	66,906,732 15	332,536,140 73	455,729,030 100
					December 31, 2021	Amount %		$ 4,484,676 1	2,099,824 -	4,253,157 1	7,994,840 1	9,380,901 2	1,228,772 -	23,879 -	9,395,685 2	- -	13,531,605 3	52,393,339 10		36,113,569 7	19,163,791 4	123,728 -	6,159,185 1	85,780 -	61,646,053 12	114,039,392 22		63,657,408 12	11,770,685 2		67,780,313 13	71,352,267 14	107,126,265 21	246,258,845 48	81,503,336 16	403,190,274 78	$ 517,229,666 100
(English Translation of Financial Statements and Report Originally Issued in Chinese)	FORMOSA PLASTICS CORPORATION	Balance Sheets	December 31, 2021 and 2020	(Expressed in Thousands of New Taiwan Dollars)	December 31, 2021 December 31, 2020	Amount % Amount % Liabilities and Equity	Current liabilities:	$ 5,946,231 1 3,768,327 1 2100 Short-term borrowings (Notes 6(i))	3,793,399 1 3,888,883 1 2110 Short-term notes and bills payable (Note 6(j))	109,316,870 21 102,218,948 22 2170 Accounts payable	2180 Accounts payable�related parties (Note 7)	11,430,079 2 7,398,424 2 2200 Other payables	6,295,311 1 4,377,266 1 2220 Other payables�related parties (Note 7)	1,333,041 - 909,517 - 2280 Current lease liabilities (Note 6(m))	5,117,317 1 7,355,148 2 2321 Current portion of bonds payable (Note 6(l))	14,317,296 3 9,730,081 2 2322 Current portion of long-term borrowings (Notes 6(k) and 8)	2,504,367 1 3,154,905 1 2399 Other current liabilities	160,053,911 31 142,801,499 32 Total current liabilities	Non-Current liabilities:	24,749,907 5 18,539,632 4 2530 Bonds payable (Note 6(l))	277,781,251 54 244,629,349 54 2570 Deferred income tax liabilities (Note 6(o))	46,142,880 9 41,804,267 9 2580 Non-current lease liabilities (Notes 6(m))	145,095 - 141,821 - 2640 Net defined benefit liabilities (Note 6(n))	124,762 - 124,762 - 2670 Other non-current liabilities	1,560,055 - 1,702,088 - Total non-current liabilities	6,671,805 1 5,985,612 1 Total liabilities	357,175,755 69 312,927,531 68 Equity (Notes 6(p)):	3110 Ordinary shares	3200 Capital surplus	Retained earnings:	3310 Legal reserve	3320 Special reserve	3350 Unappropriated retained earnings	Total retained earnings	3400 Other equity	Total equity	$ 517,229,666 100 455,729,030 100 Total liabilities and equity
						Assets	Current assets:	Cash and cash equivalents (Note 6(a))	Current financial assets at fair value through profit or loss (note 6(b))	Current financial assets at fair value through other comprehensive income	(Note 6(b))	Notes and accounts receivable, net (Notes 6(c))	Accounts receivable�related parties (Note 6(c) and 7)	Other receivables (Notes 6(d))	Other receivables�related parties (Note 6(d) and 7)	Inventories (note 6(e))	Other current assets	Total current assets	Non-current assets:	Financial assets at fair value through other comprehensive income-non- current (Note 6(b))	Investments accounted for using equity method (Note 6(f) and 7)	Property, plant and equipment (Notes 6(g), 7 and 8)	Right-of-use assets (Notes 6(h))	Intangible assets	Deferred income tax assets (Note 6(o))	Other non-current assets (Notes 8) Total non-current assets											Total assets
								1100	1110	1120		1170	1180	1200	1210	130X	1470			1510	1550	1600	1755	1780	1840	1900

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) FORMOSA PLASTICS CORPORATION AND SUBSIDIARIES Consolidated Statements of Changes in Equity For the years ended December 31, 2021 and 2020 (Expressed in Thousands of New Taiwan Dollars) Equity attributable to owners of parent Total other equity interest Share capital Retained earnings Ordinary shares Capital surplus Legal reserve Special reserve Unappropriate d retained earnings Exchange differences on translation of foreign financial statements Unrealized gains (losses) from financial assets measured at fair value through other comprehensive income Gains (losses) on hedging instruments Total equity Balance on January 1, 2020 $ 63,657,408 11,724,498 62,058,769 63,968,902 72,320,189 (5,278,250) 80,701,025 779 349,153,320 Profit for the year ended December 31, 2020 - - - - 20,036,199 - - - 20,036,199 Other comprehensive income for the year ended December 31, 2020 - - - - (92,181) (4,324,810) (4,229,221) 37,209 (8,609,003) Comprehensive income for the year ended December 31, 2020 - - - - 19,944,018 (4,324,810) (4,229,221) 37,209 11,427,196 Appropriation and distribution of retained earnings: Legal reserve appropriated - - 3,732,416 - (3,732,416) - - - - Special reserve appropriated - - - 4,910,774 (4,910,774) - - - - Cash dividends of ordinary share - - - - (28,009,259) - - - (28,009,259) Changes in equity of associates and joint ventures accounted for using equity method - - - - (52,743) - - - (52,743) Other changes in capital surplus: Changes in equity of associates and joint ventures accounted for using equity method - 5,407 - - - - - - 5,407 Other changes in capital surplus - 12,219 - - - - - - 12,219 Balance on December 31, 2020 63,657,408 11,742,124 65,791,185 68,879,676 55,559,015 (9,603,060) 76,471,804 37,988 332,536,140 Profit for the year ended December 31, 2021 - - - - 71,355,311 - - - 71,355,311 Other comprehensive income for the year ended December 31, 2021 - - - - (51,598) (3,135,343) 17,758,973 (27,026) 14,545,006 Comprehensive income for the year ended December 31, 2021 - - - - 71,303,713 (3,135,343) 17,758,973 (27,026) 85,900,317 Appropriation and distribution of retained earnings: Legal reserve appropriated - - 1,989,128 - (1,989,128) - - - - Special reserve appropriated - - - 2,472,591 (2,472,591) - - - - Cash dividends of ordinary share - - - - (15,277,778) - - - (15,277,778) Changes in equity of associates and joint ventures accounted for using equity method - - - - 3,034 - - - 3,034 Other changes in capital surplus: Changes in equity of associates and joint ventures accounted for using equity method - 527 - - - - - - 527 Other changes in capital surplus - 28,034 - - - - - - 28,034 Balance on December 31, 2021 $ 63,657,408 11,770,685 67,780,313 71,352,267 107,126,265 (12,738,403) 94,230,777 10,962 403,190,274	349,153,320	20,036,199 (8,609,003)	11,427,196	- - (28,009,259) (52,743) 5,407 12,219	332,536,140 71,355,311 14,545,006	85,900,317	- - (15,277,778) 3,034 527 28,034	403,190,274

														Total equity	349,153,320		20,036,199	(8,609,003)	11,427,196			-	-	(28,009,259)	(52,743)		5,407	12,219		332,536,140	71,355,311	14,545,006		85,900,317			-	-	(15,277,778)	3,034		527	28,034		403,190,274
(English Translation of Parent Company Only Financial Statements and Report Originally Issued in Chinese)	FORMOSA PLASTICS CORPORATION	Statements of Changes in Equity	For the years ended December 31, 2021 and 2020	(Expressed in Thousands of New Taiwan Dollars)	Total other equity interest	Share capital Retained earnings Unrealized	gains (losses)	from financial	Exchange assets measured	differences on at fair value		Unappropriated translation of through other Gains (losses)	Ordinary retained foreign financial comprehensive on hedging	shares Capital surplus Legal reserve Special reserve earnings statements income instruments	Balance on January 1, 2020 $ 63,657,408 11,724,498 62,058,769 63,968,902 72,320,189 (5,278,250) 80,701,025 779		Net Income for the period - - - - 20,036,199 - - -	Other comprehensive income (loss) for the period - - - - (92,181) (4,324,810) (4,229,221) 37,209	Total comprehensive income (loss) for the period - - - - 19,944,018 (4,324,810) (4,229,221) 37,209		Appropriation and distribution of retained earnings:	Legal reserve appropriated - - 3,732,416 - (3,732,416) - - -	Special reserve appropriated - - - 4,910,774 (4,910,774) - - -	Cash dividends of ordinary share - - - - (28,009,259) - - -	Changes in equity of associates and joint ventures accounted - - - - (52,743) - - -	Other changes in capital surplus:	Changes in equity of associates and joint ventures accounted for using equity method - 5,407 - - - - - -	Other changes in capital surplus - 12,219 - - - - - -		Balance on December 31, 2020 63,657,408 11,742,124 65,791,185 68,879,676 55,559,015 (9,603,060) 76,471,804 37,988	Net Income for the period - - - - 71,355,311 - - -	Other comprehensive income (loss) for the period - - - - (51,598) (3,135,343) 17,758,973 (27,026)		Total comprehensive income (loss) for the period - - - - 71,303,713 (3,135,343) 17,758,973 (27,026)		Appropriation and distribution of retained earnings:	Legal reserve appropriated - - 1,989,128 - (1,989,128) - - -	Special reserve appropriated - - - 2,472,591 (2,472,591) - - -	Cash dividends of ordinary share - - - - (15,277,778) - - -	Changes in equity of associates and joint ventures accounted - - - - 3,034 - - -	Other changes in capital surplus:	Changes in equity of associates and joint ventures accounted for using equity method - 527 - - - - - -	Other changes in capital surplus - 28,034 - - - - - -		Balance on December 31, 2021 $ 63,657,408 11,770,685 67,780,313 71,352,267 107,126,265 (12,738,403) 94,230,777 10,962

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) FORMOSA PLASTICS CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from (used in) operating activities: Profit before tax Adjustments: Adjustments to reconcile profit (loss): Depreciation expense Amortization expense Expected credit loss (gain) Net loss on financial assets or liabilities at fair value through profit Interest expense Interest revenue Dividend income Share of profit of associates and joint ventures accounted for using equity method Gain on disposal of property, plant and equipment Unrealized foreign exchange gain Total adjustments to reconcile (profit) loss Changes in operating assets and liabilities: Changes in operating assets: Notes receivable Accounts receivable Accounts receivable due from related parties Other receivables Other receivables due from related parties Inventories Other current assets Total changes in operating assets Changes in operating liabilities: Accounts payable Accounts payable to related parties Other payables Other payables to related parties Other current liabilities Net defined benefit liability Total changes in operating liabilities Total changes in operating assets and liabilities Total adjustments Cash inflow generated from operations Interest received Dividends received Interest paid Income taxes paid Net cash flows from operating activities Cash flows from (used in) investing activities: Acquisition of financial assets at fair value through other comprehensive income Proceeds from capital reduction of financial assets at fair value through other comprehensive income Acquisition of investments accounted for using equity method Proceeds from capital reduction of investments accounted for using equity method Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Acquisition of intangible assets (Increase)Decrease in other receivables due from related parties Increase in other non-current assets Net cash flows used in investing activities Cash flows from (used in) financing activities: Increase in short-term borrowings Decrease in short-term borrowings (Decrease)Increase in short-term notes and bills payable Proceeds from issuing bonds Repayments of bonds Proceeds from long-term borrowings Repayments of long-term borrowings Decrease in due to related parties (recognized as other payables�related parties) Payment of lease liabilities Decrease in other non-current liabilities Cash dividends paid Net cash flows (used in) from financing activities Effect of exchange rate changes on cash and cash equivalents Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period		2021 $ 85,956,814 7,307,919 1,036,461 80,616 95,484 790,439 (236,164) (2,999,580) (23,453,093) (17,476) (130,129) (17,525,523) (3,657,900) (4,687,166) (1,249,491) (457,132) 172,275 (8,202,010) 1,727,935 (16,353,489) 1,756,262 1,099,182 (42,512) 515,522 3,745,737 (790,433) 6,283,758 (10,069,731) (27,595,254) 58,361,560 177,341 5,259,139 (787,439) (5,151,258) 57,859,343 (91,000) - (1,387,981) 43,895 (18,196,657) 53,791 (84,637) (993,439) (1,164,820) (21,820,848) 193,773,116 (204,637,833) (14,900,000) 7,500,000 (2,900,000) 2,636,444 (2,000,000) (137,792) (30,766) (7,263) (15,282,289) (35,986,383) (481,768) (429,656) 14,145,110 $ 13,715,454	2020 24,166,667

			7,210,271 791,281 (1,565) 155,473 1,206,988 (374,256) (3,358,166) (5,212,882) (8,803) (45,042)
			363,299
			436,428 (2,934,044) 122,804 108,293 (204,072) 1,348,028 (1,837,435)
			(2,959,998)
			1,797,199 255,174 198,260 (553,117) (5,236) (408,019)
			1,284,261
			(1,675,737)
			(1,312,438)
			22,854,229 367,388 11,694,866 (1,201,708) (2,270,322)
			31,444,453
			- 12,500 (625,000) - (8,883,039) 19,808 (214,341) 8,499,835 (2,725,618)
			(3,915,855)
			333,456,117 (338,190,057) 2,000,000 8,350,000 - 1,536,598 (4,592,694) (6,131,284) (37,891) (98,896) (28,012,404)
			(31,720,511)
			171,071
			(4,020,842) 18,165,952
			14,145,110

See accompanying notes to consolidated financial statements.

(English Translation of and Report Originally Issued in Chinese) FORMOSA PLASTICS CORPORATION

Statements of Cash Flows

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from (used in) operating activities: Profit before tax Adjustments: Adjustments to reconcile profit (loss): Depreciation expense Amortization expense Expected credit loss(gain) Interest expense Net loss on financial assets at fair value through profit Interest revenue Dividend income Share of profit of associates and joint ventures accounted for using equity method Gain on disposal of property, plant and equipment Realized loss on from sales Unrealized foreign exchange gain Total adjustments to reconcile profit Changes in operating assets and liabilities: Changes in operating assets: Notes and accounts receivable Accounts receivable due from related parties Other receivable Other receivable due from related parties Inventories Other current assets Total changes in operating assets Changes in operating liabilities: Accounts payable Accounts payable to related parties Other payable Other payable to related parties Other current liabilities Net defined benefit liability Total changes in operating liabilities Total changes in operating assets and liabilities Total adjustments Cash inflow generated from operations Interest received Dividends received Interest paid Income taxes paid Net cash flows from operating activities Cash flows (used in) from investing activities: Acquisition of financial assets at fair value through other comprehensive income Proceeds from capital reduction of financial assets at fair value through other comprehensive income Liquidation of investments accounted for using equity method Acquisition of investments accounted for using equity method Proceeds from capital reduction of investments accounted for using equity method Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Acquisition of intangible assets Decrease in other receivables due from related parties Increase in other non-current assets Net cash flows used in investing activities Cash flows from (used in) financing activities: Increase in short-term borrowings Decrease in short-term borrowings (Decrease)increase in short-term notes and bills payable Proceeds from issuing bonds Repayments of bonds Repayments of long-term borrowings Payment of lease liabilities Increase (decrease) in other non-current liabilities Cash dividends paid Net cash flows used in financing activities Effect of exchange rate changes on cash and cash equivalents Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period		2021 $ 82,318,302 3,969,927 310,774 63,492 595,976 95,484 (62,838) (2,999,580) (32,444,780) (22,606) 12,640 (123,237) (30,604,748) (4,081,607) (1,918,046) (457,413) 618,030 (4,863,996) 650,539 (10,052,493) 692,286 1,169,463 24,704 148,486 2,038,898 (790,433) 3,283,404 (6,769,089) (37,373,837) 44,944,465 55,267 5,259,139 (603,419) (2,479,847) 47,175,605 (91,000) - - (1,387,981) 43,895 (8,013,993) 36,564 - 1,620,896 (986,387) (8,778,006) 193,642,107 (203,784,041) (14,900,000) 7,500,000 (2,900,000) (2,000,000) (30,766) 1,432,348 (15,282,289) (36,322,641) 102,946 2,177,904 3,768,327 $ 5,946,231	2020 23,278,277

			3,584,577 245,891 (1,687) 788,782 155,473 (229,622) (3,358,166) (6,869,606) (13,514) 59,955 (110,138)
			(5,748,055)
			(2,419,886) 917,230 90,816 (83,637) 712,341 (809,880)
			(1,593,016)
			779,444 81,950 (4,104) (18,717) 364,670 (408,019)
			795,224
			(797,792)
			(6,545,847)
			16,732,430 251,751 11,694,866 (756,578) (1,634,922)
			26,287,547
			- 12,500 236 (14,041,020) - (5,835,240) 19,702 (2,000) 8,632,355 (985,255)
			(12,198,722)
			326,554,054 (328,097,145) 2,000,000 8,350,000 - (3,433,333) (37,891) (11,298) (28,012,404)
			(22,688,017)
			66,262
			(8,532,930) 12,301,257
			3,768,327

See accompanying notes to financial statements.

Formosa Plastics Corporation Statement of Profits Distribution For the year of 2021

Formosa Plastics Corporation Statement of Profits Distribution For the year of 2021	Formosa Plastics Corporation Statement of Profits Distribution For the year of 2021
		Unit：NTD
Items		Amount
Available for Distribution: 1.Unappropriated retained earnings of previous years 2.Net profit after tax of current year 3.Other profit items adjusted to the current year’s undistributed earnings other than after-tax net income for the period Total Distribution Items: 1.Appropriation of legal reserve 2.Appropriation of special reserve 3.Distribution of dividends and bonus in cash ( $8.2 per share) 4.Unappropriated retained earnings carried forward to next year Total		35,819,897,455 71,355,310,849 -48,563,813
		107,126,644,491
		7,130,674,704 11,168,702,713 52,199,074,404 36,628,192,670
		107,126,644,491

Explanation	1. The Company plans to distribute dividends of $8.2 per share for current year (among which, $4.1 per share will be distributed as dividends and $4.1 per share will be distributed as bonus); all of which are cash dividends. 2. The Company distributes dividends and bonus for a total of $52,199,074,404; all of which are from net profit after tax of 2021. 3. Other comprehensive income transferred to unappropriated earnings of current year is due to a re-measurement of the actuarial pension adjustment 4. While the distribution of cash dividends to each individual shareholder is less than $1, the distribution will be rounded to the nearest dollar.

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KPMG

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Independent Auditors’ Report

To the Board of Directors of Formosa Plastics Corporation:

Opinion

We have audited the consolidated financial statements of Formosa Plastics Corporation (the "Company") and its subsidiaries (together referred to as the "Group"), which comprise the consolidated statements of financial position as of December 31, 2021 and 2020, and the consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, based on our audits and the reports of other auditors, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2021 and 2020, and its consolidated financial performance and its consolidated cash flows for the years ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and with the International Financial Reporting Standards (“IFRSs”), International Accounting Standards (“ IASs” ), Interpretations developed by the International Financial Reporting Interpretations Committee (“IFRIC”) or the former Standing Interpretations Committee (“SIC”) endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

Basis for Opinion

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

1. Revenue Recognition

As the control of products transfers at different points in time, it exposes the risk wherein revenue may not be recognized within the proper period. For this reason, revenue recognition is considered to be one of our key audit matters. The accounting policies and the related information for the revenue recognition were discussed in Notes 4(o) and 6(r) to the consolidated financial statements.

KPMG, a Taiwan partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee.

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The principal audit procedures we have performed to address the aforementioned key audit matter included assessing the rationality of accounting treatment for revenue recognition; vouching the original sales documents according to the transactions with the customers during a selected period of time before and after the balance sheet date to evaluate whether the revenue is recorded appropriately.

2. Valuation of Inventories

The Group measured the cost and net realizable value of inventory and recognized the loss on the balance sheet date according to IAS 2 (including loss on obsolescence of inventories); However, to determine whether or not the loss of inventories should be recognized depends on the subjective judgment of the management. For this reason, the valuation of inventories is considered to be one of the key audit matters. The accounting policies and the related information for the valuation of inventories were discussed in Notes 4(h), 5 and 6(e) to the consolidated financial statements.

The principal audit procedures we have performed to address the aforementioned key audit matter included assessing the appropriateness of the policy on inventory valuation and slack loss recognition; ensuring whether the process of inventory valuation is in conformity with the accounting policies, confirming the sales price adopted by the management and the changes in the market price of inventory in the period after the balance sheet date; and sampling procedures to assess the reasonableness of the net realizable value of inventory.

Other Matter

We did not audit the financial statements of certain investee companies under the equity method and the relevant information on the reinvestment business in Note 13 of the consolidated financial report has not been checked by this accountant, but is checked by other accountants. The Group's investments in the aforementioned investee companies constituted 31.06% and 31.12% of the consolidated total assets as of December 31, 2021 and 2020, respectively; and the recognized shares of profit of associates accounted for using equity method of these investee companies constituted 23.32% and 10.67% of the consolidated income before tax for the years ended December 31, 2021 and 2020, respectively. The consolidated financial statements of the aforementioned investee companies were audited by other auditors whose reports have been furnished to us, and our opinion, insofar as it relates to the amounts included for these investee companies, is based solely on the reports of other auditors.

We have also audited the parent company only financial statements of the Company as of and for the years ended December 31, 2021 and 2020, and have expressed an unmodified opinion thereon.

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

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

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

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

4-2

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

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

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

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

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

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

4-3

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

The engagement partners on the audit resulting in this independent auditors’ report are Hui-chih Kou and Chi-Lung Yu.

KPMG

Taipei, Taiwan (Republic of China) March 10, 2022

Notes to Readers

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

The independent auditors’ audit report and the accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ audit report and consolidated financial statements, the Chinese version shall prevail.

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KPMG

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Independent Auditors’ Report

To the Board of Directors of Formosa Plastics Corporation:

Opinion

We have audited the financial statements of Formosa Plastics Corporation (the “Company”) which comprise the balance sheets as of December 31, 2021 and 2020, and the statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, based on our audits and the reports of other auditors, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and its financial performance and its cash flows for the years ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuer.

Basis for Opinion

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Key audit matters for the Company's financial statements are stated as follows:

1. Revenue recognition

As the control of products transfers at different points in time, it exposes the risk wherein revenue may not be recognized within the proper period. For this reason, revenue recognition is considered to be one of our key audit matters. The accounting policies and the related information for revenue recognition were discussed in Notes 4(o) and 6(r) to the financial statements.

KPMG, a Taiwan partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. 51

3-1

Valuation of Inventories

The Group measured the cost and net realizable value of inventory and recognized a loss on the balance sheet date according to IAS 2 (including loss on obsolescence of inventories); however, to determine whether or not the loss of inventories should be recognized depends on the subjective judgment of the management. For this reason, the valuation of inventories is considered to be one of the key audit matters. The accounting policies and the related information for the valuation of inventories were discussed in Notes 4(g), 5 and 6(e) to the financial statements.

Other Matter

We did not audit the financial statements of certain investee companies under equity method and the relevant information on the reinvestment business in Note 13 of the financial report has not been checked by this accountant, but is checked by other accountants. The Company's investments in the aforementioned investee companies constituted 32.65% and 32.73% of the total assets as of December 31, 2021 and 2020, respectively; and the recognized shares of profit of associates accounted for using equity method of these investee companies constituted 24.35% and 11.08% of the income before tax for the years ended December 31, 2021 and 2020, respectively. The financial statements of the aforementioned investee companies were audited by other auditors whose reports have been furnished to us, and our opinion, insofar as it relates to the amounts included for these investee companies, is based solely on the reports of other auditors.

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

Management is responsible for the preparation and fair presentation of the financial statements in accordance with Regulations Governing the Preparation of Financial Reports by Securities Issuers and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

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

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

Auditors’ Responsibilities for the Audit of the Financial Statements

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

3-2

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

3-3

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

The engagement partners on the audit resulting in this independent auditors’ report are Hui-chih Kou and Chi-Lung Yu.

KPMG

Taipei, Taiwan (Republic of China) March 10,2022

Notes to Readers

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

The independent auditors’ audit report and the accompanying parent company only financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ audit report and parent company only financial statements, the Chinese version shall prevail.

Articles of Association of

Formosa Plastics Corporation

Amended and reinstated by General Shareholders Meeting on June 10, 2020

Chapter I General Provisions

Article 1: The Company is incorporated under the name of Fu-mao Plastics Corporation, a private company limited by shares, in accordance with Company Act. On January 14, 1957, the Company’s extraordinary shareholders meeting passed a resolution to change its name to Formosa Plastics Corporation, which has been given the effect by the approval of competent authority as of March 18, 1957.
Article 2: Scope of Business:
(1)B202010: Nonmetallic Mining
(2)C199990: Other Food Manufacturing Not Elsewhere Classified
(3)C801010: Basic Industrial Chemical Manufacturing
(4)C801020: Petrochemical Manufacturing
(5)C801100: Synthetic Resin & Plastic Manufacturing
(6)C801120: Manmade Fiber Manufacturing
(7)C801990: Other Chemical Materials Manufacturing
(8)C802120: Industrial Catalyst Manufacturing
(9)C802170: Poisonous Chemical Material Manufacturing
(10)C805020: Plastic Sheets & Bags Manufacturing
(11)C901070: Stone Products Manufacturing
(12)CB01010: Machinery and Equipment Manufacturing
(13)CC01080: Electronic Parts and Components Manufacturing
(14)D101050: Steam and Electricity Paragenesis
(15)D301010: Water Supply
(16)D401010: Heat Energy Supplying
(17)E603050: Cybernation Equipments Construction
(18)H701010: Residence and Buildings Lease Construction and Development
(19)H701040: Specialized Field Construction and Development
(20)ID01010: Metrological Instruments Identify
(21)IZ99990: Other Industry and Commerce Services Not Elsewhere

Classified

(22)J101050: Sanitary and Pollution Controlling Services
(23)ZZ99999: All business items that are not prohibited or restricted by law, except those that are subject to special approval
Article 3: The Company is headquartered in Kaohsiung City, ROC and may set up factories or branch offices in the country or at overseas locations when necessary. Such establishments, modifications and abolishment will be subject to the resolutions of the Meeting of Directors.
Article 4: The Company may provide endorsement for the related business. The total investment made by the Company may exceed forty percent (40%) of its paid-up capital.
Article 5: Notice of the Company will be published in a manner prescribed in Article 28 of Company Act.

Chapter II Shares

Article 6: The registered capital of the Company is sixty-three billion six hundred fifty-seven million four hundred seven thousand eight hundred ten New Taiwan dollars, divided into six billion three hundred sixty-five million seven hundred forty thousand seven hundred eighty-one full capital shares having a par value of ten New Taiwan dollars.
Article 7: The Company may exempt from printing share certificates but shall register with Central Securities Depository for each share issued.
Article 8: A shareholder shall provide his address and personal seal to receive or transfer any share.
Article 9: (Omitted)
Article 10: (Omitted)
Article 11: (Omitted)
Article 12: The registration of share transfer will be halted within sixty days prior to a general meeting, thirty days prior to an extraordinary meeting or five days prior to the closing date regarding a distribution of dividends and bonus or other interests.

Chapter III Shareholders Meeting

Article 13: A shareholders meeting can be a general meeting or an extraordinary meeting. The Company’s Board of Directors shall convene the annual

general meeting once every year within six month after the end of each fiscal year. The Board of Directors may convene an extraordinary meeting whenever necessary unless the Company Act suggests otherwise.

Article 14: The meeting notice shall be published and given to all shareholders at least thirty days prior to a general meeting and fifteen days prior to an extraordinary meeting. The notice shall specify the purpose of such meeting and may be made by electronic communication pursuant to the receiving party’s consent.
Article 15: The Chairman of the Board of Directors will preside the shareholders meeting. Where the Chairman is on leave or not able to perform his duty for any reason, the Vice Chairman shall act on his behalf. Where the Vice Chairman is also on leave or not able to perform his duty for any reason, the Chairman shall appoint one executive director to act on his behalf. If the Chairman has made no appointment, the executive directors shall elect among themselves one person to act as the deputy.
Article 16: Each share is entitled to cast one vote, unless otherwise deprived in accordance with Article 179 paragraph 2 of Company Act.
Article 17: A shareholder may appoint a proxy to attend a shareholders meeting by delivering the proxy form prepared by the Company five days prior to the shareholders meeting. The proxy vote shares held by one proxy representing two or more principals may not exceed three percent (3%) of the total shares issued by the company. Any votes exceeding such limit will not be counted.
Article 18: Unless otherwise stipulated in Company Act, any resolution of a shareholder meeting shall be decided by more than one-half the shareholders presenting at the shareholders meeting consisting of more than one-half the total voting shares.
Article 19: The meeting minutes shall be prepared for each shareholders meeting, recording any resolutions being made, the meeting dates, times, venue, the chairperson’s name, the voting procedures, the summary and the result of the process, and signed by the chairperson or stamped. Such meeting minutes shall be archived throughout the existence of the Company. The attendance books and proxies shall be retained for at least one year. The copies of the meeting minutes may be distributed in an

electronic manner.

The distribution of the foregoing meeting minutes may be made by posting a public announcement onto the Market Observation Post System.

Chapter IV Directors

Article 20: The Board shall consist of eleven to fifteen directors. The election of directors will be made by nomination. Shareholders may elect the directors from the candidates list. The total registered shares held by the directors shall not be less than a certain quorum of the company’s total shares. The calculation of quorum shall conform to the method instructed by the competent authority.
The foregoing numbers of directors shall include at least three independent directors, whose nominations and elections shall be processed in accordance with the Company Act and as required by the competent authority of securities and exchange.
The Company established the Audit Committee pursuant to Article 14-4 of the Securities and Exchange Act, where its members consist of all independent directors. The operation of the Audit Committee as well as the responsibilities and rights of the members shall be determined in accordance with the Securities and Exchange Act and other applicable laws.
Article 21: The directors shall elect at least three from among themselves but not more than one third of all the directors to serve as the executive directors, including one independent director. The five executive directors shall elect one of them to become the Chairman of the Board and another person to be the Vice Chairman. The Chairman represents the Company externally and is responsible for general business. When the Chairman is on leave or not able to perform his duty for any reason, the Vice Chairman shall act as the deputy. When the Vice Chairman is also on leave or not able to perform his duty, the Chairman shall appoint one executive director to act on his behalf.
Article 22: The Board will determine the Company’s operation strategies and other significant issues. The Board Meeting shall be convened and presided by the Chairman or by his deputy according to the preceding paragraph if

the Chairman is in absence.

The significant issues of the forgoing paragraph shall include the acquisition and disposal of the Company’s major assets and properties. The Board may empower the Chairman to act on behalf of the Board during the adjournment period. Unless otherwise required by laws or these articles, any issue concerning the major interest of the company or related party transaction shall not be decided without a Board resolution. The powers authorized include:

I. To approve any major contracts;
II. To approve any mortgage of property and loan proposal;
III. To approve the acquisition and disposal of the company’s general asset and property;
IV. To approve the appointment of directors and supervisors of a subsidiary;

To approve the closing date of capital increase/decrease and the distribution of cash dividends.

Article 23: Any resolution of the Board shall be determined by one-half of the directors presenting at the meeting consisting of one-half of the total directors.
Article 24: A director shall hold the office for a term of three years and may be reelected. If the election does not complete in time upon the expiration of any term of office, the director may continue to serve until his successor is elected.
Article 25: Any vacancy on the Board may be filled by immediate election, which may be postponed when the vacant directorship is less than one third of the total directors. The elected director in the place of a vacant directorship will serve for the remaining period of the previous director’s term of office.
Article 26: Any resolution made by the Board meeting shall be documented in the meeting minutes, which shall be signed by the chairperson or stamped and archived in the Company.
Article 27: The Directors shall present at the Board Meeting in person. If the Directors may not be present at the meeting for any reason, unless the Directors resides in oversea location as prescribed by the Company Act, he/she may submit a proxy form, enumerating the purpose of convening

such meeting, the scope of authorization, to appoint another director to attend the meeting. A proxy director may not act on behalf of more than one person.

If the Board Meeting is conducted by teleconference, directors who attend the meeting through video conference shall be deemed attending in person.

The Board shall specify the purposes of a Board Meeting and notify each director seven days in advance. Notwithstanding, the Board may convene a meeting where there is an urgency. The notice of Board Meeting may be served in writing, by email or facsimile.

Article 28: The Board shall have the power to determine the remuneration of directors based on how a director participates and contributes in the Company’s operation and with reference to the standards implemented by the other companies in the same industry.

The Company shall be held liable for any conduct by a director within his scope of duty during his terms of office and shall maintain valid director liability insurance to the extent required by the laws.

Chapter V (Omitted)

Article 29: (Omitted)

Article 30: (Omitted)

Article 31: (Omitted)

Article 32: (Omitted)
Article 33: (Omitted)
Article 34: (Omitted)
Article 35: (Omitted)

Chapter VI Manager

Article 36: The Company may have managers. The appointment, removal and compensation of a manager shall be determined in accordance with Article 29 of the Company Act.
Article 37: The manager may not serve the equivalent position of another company at the same time and shall refrain from any activities identical to the Company’s business whether by self-employment or for the benefit of

others unless otherwise permitted by the Board to the extent permitted by the laws.

Chapter VII Accounting

Article 38: The Company’s fiscal year starts from January 1 and ends on December 31 of each calendar year. The Board shall prepare the following reports for the ratification by the general shareholders meeting after the final settlement:
(I) Business Operation Report,
(II) Financial Statements, and
(III) Measures on profit distribution or deficit compensation.
Article 39: If the Company gains any profits in any year, the Company shall retain 0.05% to 0.5% of the pre-tax profit as employee compensation before deducting the employee compensation of such year; provided, however, that the Company shall reserve the amount for compensating the deficit, if any.
The determination of employee compensation shall be made in accordance with Article 235-1 of the Company Act.
Article 40: If there are any earnings after final account settlement, the Company shall pay off the applicable taxes, compensate the accrued deficit and retain 10% as legal reserve and an additional amount as special reserve before distributing dividends. If there are any remaining earnings of such year, the Board may, combining the undistributed earnings of previous years, propose a shareholder bonus plan and submit for the approval in a general shareholders meeting.

The special reserve as described in the preceding paragraph includes

(1) any amount reserved for any particular purpose,
(2) investment profit and unused deductions for taxable income pursuant to equity methods,
(3) and other special reserve prescribed by applicable laws and regulations.

The Company is in a business of a mature industry and earns its annual profits on a stable basis. The Company adopts a dividend policy that allows the distribution to be made in either way of or a combination of cash dividends, earnings capitalization and capitalization of capital

reserve. At least fifty percent (50%) of the annual distributable earning remained after deducting the legal reserve and special reserve will be distributed, preferably in cash. The total percentage of the capitalization of retained earnings and capital reserve shall not be more than fifty percent (50%) of the total dividends distributed of such year.

Chapter VIII Miscellaneous

Article 41: The Company Act and other applicable laws rules shall govern any matter not prescribed herein.
Article 42: These articles of association are stipulated on July 20, 1954, and reinstated by first amendment on January 8, 1955, second amendment on January 14, 1957, third amendment on August 20, 1957, fourth amendment on July 10, 1958, fifth amendment on March 31, 1960, sixth amendment on September 7, 1960, seventh amendment on July 3, 1961, eighth amendment on December 31, 1963, ninth amendment on February 25, 1965, tenth amendment on March 25, 1965, eleventh amendment on August 20, 1966, twelfth amendment on March 25, 1967, thirteenth amendment on March 25, 1968, fourteenth amendment on April 21, 1969, fifteenth amendment on April 30, 1970, sixteenth amendment on April 20, 1971, seventeenth amendment on March 21, 1972, eighteenth amendment on March 20, 1973, nineteenth amendment on March 26, 1974, twentieth amendment on April 10, 1975, twenty-first amendment on April 15, 1976, twenty-second amendment on August 21, 1976, twenty-third amendment on April 15, 1977, twenty-fourth amendment on April 18, 1978, twenty-fifth amendment on April 16, 1979, twenty-sixth amendment on April 2, 1980, twenty-seventh amendment on April 2, 1981, twenty-eighth amendment on April 9, 1982, twenty-ninth amendment on April 18, 1983, thirtieth amendment on April 27, 1984, thirty-first amendment on April 29, 1985, thirty-second amendment on April 24, 1986, thirty-third amendment on April 15, 1977, thirty-fourth amendment on April 29, 1988, thirty-fifth amendment on April 28, 1989, thirty-sixth amendment on April 13, 1990, thirty-seventh amendment on April 16, 1991, thirty-eighth amendment on April 16, 1992, thirty-ninth amendment on April 16, 1993, forties amendment on April 26 1994, forty-first amendment on

April 14, 1995, forty-second amendment on April 19, 1996, forty-third amendment on May 6, 1997, forty-fourth amendment on May 8, 1998, forty-fifth amendment on May 20, 1999, forty-sixth amendment on May 17, 2000, forty-seventh amendment on May 17, 2001, forty-eighth amendment on May 24, 2002, forty-ninth amendment on May 23, 2003, fiftieth amendment on May 14, 2004, fifty-first amendment on May 23, 2005, fifty-second amendment on June 5, 2006, fifty-third amendment on June 14, 2007, fifty-fourth amendment on June 19, 2008, fifty-fifth amendment on June 5, 2009, fifty-sixth amendment on June 25, 2010, fifty-seventh amendment on June 20, 2011, fifty-eighth amendment on June 19, 2012, fifty-ninth amendment on June 14, 2013, sixtieth amendment on June 13, 2014 where the articles regarding the establishment of Audit Committee and the omission of articles regarding supervisors shall become effective at the time the terms of office of the supervisors elected by the general shareholder meeting on June 19, 2012 has expired, the sixty-first amendment on June 17, 2016, sixty-second amendment on June 20, 2018, and sixty-third amendment on June 10, 2020.

Rules of Procedure for Shareholders’ Meetings of Formosa Plastics Corporation

Amended by the Annual Shareholders’ Meeting on July 29, 2021

Article 1: To establish a strong governance system and sound supervisory capabilities for the Company's shareholders’ meetings, and to strengthen management capabilities, these Rules are adopted pursuant to the Corporate Governance Best Practice Principles for Taiwan Stock Exchange Corp (“TWSE”)/ Taipei Exchange (“TPEx”) Listed Companies.
Article 2: The rules of procedures for the Company's shareholders’ meetings, except as otherwise provided by law, regulation, or the Articles of Incorporation, shall be as provided in these Rules.
Article 3: Unless otherwise provided by law or regulation, the Company's Shareholders’ Meetings shall be convened by the Board of Directors. A notice to convene an annual shareholders’ meeting shall be given to each shareholder no later than 30 days prior to the scheduled meeting date; while a notice may be given to registered shareholders who own less than 1,000 shares of nominal stocks no later than 30 days prior to the scheduled meeting date in the form of a public announcement on the Market Observation Post System (MOPS) of the TWSE. A notice to convene a special shareholders’ meeting shall be given to each shareholders no later than 15 days prior to the scheduled meeting date. A public notice may be given to registered shareholders who own less than 1,000 shares of nominal stocks no later than 15 days prior to the scheduled meeting date in the form of a public announcement on the MOPS of the TWSE.
To convene a shareholders’ meeting, the Company shall prepare a meeting handbook. The Company shall prepare electronic versions of a shareholders’ meeting notice and proxy forms, and causes of and explanatory materials relating to all proposals, including proposals for ratification, matters for deliberation, or the election or dismissal of directors, and upload them to the MOPS no later than 30 days prior to the scheduled Annual Shareholders’ Meeting date or no later than 15 days prior to the scheduled Special Shareholders’ Meeting date. The

Company shall prepare electronic versions of a shareholders’ meeting handbook and supplemental meeting materials and upload them to the MOPS no later than 21 days prior to the scheduled Annual Shareholders’ Meeting date or no later than 15 days prior to the scheduled Special Shareholders’ Meeting date. In addition, the Company shall also have prepared a shareholders’ meeting handbook and supplemental meeting materials and made them available for review by shareholders at any time no later than 15 days prior to the scheduled Shareholders’ Meeting date. The Meeting Agenda and supplemental materials shall also be displayed at the Company and the professional shareholder services agent engaged by the Company as well as being distributed on-site at the meeting place.

The reasons for convening a shareholders’ meeting shall be specified in the meeting notice and public announcement. With the consent of the addressee, the meeting notice may be given in electronic form.

Election or dismissal of directors, amendments to the Articles of Incorporation, capital reduction, application to be delisted from public offering, lifting of non-competition restriction of directors, capital increase by retained earnings, capital increase by capital reserve, dissolution, merger, or demerger of the corporation, or any matter under Paragraph 1 of Article 185 of the Company Act, Articles 26-1 and 43-6 of the Securities Exchange Act, Articles 56-1 and 60-2 of the Regulations Governing the Offering and Issuance of Securities by Securities Issuers shall be set out in the notice of the reasons for convening the shareholders’ meeting. None of the above matters may be raised by an extraordinary motion.

Where the meeting agenda has specified general re-elections of the directors and the terms of the directors’ office, the terms of office of the directors shall not be altered by raising an extraordinary motion or any other method upon the completion of the general elections at the shareholders’ meeting.

A shareholder holding 1 percent or more of the total number of issued shares may submit to the Company a proposal for discussion at an annual shareholders’ meeting. Such proposals, however, are limited to one item only, and no proposal containing more than one item will be included in the Meeting Agenda. In addition, when the circumstances of

any subparagraph of paragraph 4 of Article 172-1 of the Company Act apply to a proposal put forward by a shareholder, the Board of Directors may exclude it from the Agenda. A shareholder may propose a recommendation for urging the corporation to promote public interests or fulfill social responsibilities, and the providing procedure shall be in accordance with Article 172-1 of the Company Act.

Prior to the book closure date before an annual shareholders’ meeting is held, the Company shall publicly announce that it will receive shareholder proposals, the method of receiving such proposals (whether written or in electronic form), and the location and time period for their submission; the period for submission of shareholder proposals may not be less than 10 days.

Shareholder-submitted proposals are limited to 300 words, and no proposal containing more than 300 words will be included in the meeting agenda. The shareholder making the proposal shall be present in person or by proxy at the Annual Shareholders’ Meeting and take part in discussion of the proposal.

Prior to the date for issuance of notice of a shareholders’ meeting, the Company shall inform the shareholders who submitted proposals of the proposal screening results, and shall list in the meeting notice the proposals that conform to the provisions of this article. At the Shareholders’ Meeting the Board of Directors shall explain the reasons for exclusion of any shareholder proposals not included in the agenda.

Article 4: For each shareholders’ meeting, a shareholder may appoint a proxy to attend the meeting by providing the proxy form issued by the Company and stating the scope of the power authorized to the proxy.

A shareholder may issue only one proxy form and appoint only one proxy for any given shareholders’ meeting, and shall deliver the proxy form to the Company no later than 5 days prior to the Shareholders’ Meeting date. When duplicate proxy forms are delivered, the one received earliest shall prevail unless a declaration is made to revoke the previous proxy appointment.

After a proxy form has been delivered to the Company, if the shareholder intends to attend the meeting in person or to exercise voting rights in writing or by way of electronic transmission, a written notice of

proxy rescission shall be submitted to the Company no later than 2 days prior to the meeting date. If the rescission notice is submitted after that time, votes cast at the meeting by the proxy shall prevail.

Article 5: The venue for a shareholders’ meeting shall be the premises of the Company, or a place easily accessible to shareholders and suitable for a shareholders’ meeting. The meeting may begin no earlier than 9 a.m. and no later than 3 p.m.
Article 6: The Company shall specify in its shareholders’ meeting notices the time during which shareholder attendance registrations will be accepted, the place to register for attendance, and other matters for attention.
The time during which shareholder attendance registrations will be accepted, as stated in the preceding paragraph, shall be at least 30 minutes prior to the time the meeting commences. The place at which attendance registrations are accepted shall be clearly marked and a sufficient number of suitable personnel assigned to handle the registrations.
The Company shall furnish attending shareholders with the meeting agenda book, annual report, attendance card, speaker's slips, voting slips, and other meeting materials. Where there is an election of directors, pre-printed ballots shall also be furnished.
Shareholders and their proxies (collectively, "shareholders") shall attend shareholders’ meetings based on attendance cards, sign-in cards, or other certificates of attendance. The Company shall not impose arbitrary requirements on shareholders to provide additional evidentiary documents beyond those showing eligibility to attend. Solicitors soliciting proxy forms shall also bring identification documents for verification.
When the government or a juristic person is a shareholder, it may be represented by more than one representative at a shareholders’ meeting. When a juristic person is appointed to attend as proxy, it may designate only one person to represent it in the meeting.
Article 7: If a shareholders’ meeting is convened by the Board of Directors, the meeting shall be chaired by the Chairman. When the Chairman is on leave or for any reason unable to exercise the powers of the Chairman, the Vice Chairman shall act in place of the Chairman; if there is no Vice

Chairman or the Vice Chairman also is on leave or for any reason unable to exercise the powers of the Vice Chairman, the Chairman shall appoint one of the Managing Directors to act as chair, or, if there are no Managing Directors, one of the Directors shall be appointed to act as chair. Where the Chairman does not make such a designation, the Managing Directors or the Directors shall select from among themselves one person to serve as chair.

When a Managing Director or a Director serves as chair, as referred to in the preceding paragraph, the Managing Director or Director shall be one who has held that position for 6 months or more and who understands the financial and business conditions of the Company. The same shall be true for a representative of a juristic person director that serves as chair.

It is advisable that shareholders’ meetings convened by the Board of Directors be chaired by the Chairman, that a majority of the Directors attend in person, and that at least one member of each functional committee attend as representative. Attendance details should be recorded in the Shareholders Meeting minutes. If a shareholders’ meeting is convened by a party having the convening right but other than the Board of Directors, the convening party shall chair the meeting. When there are two or more such convening parties, they shall mutually select a chair from among themselves.

The Company may appoint its attorneys, certified public accountants, or related persons retained by it to attend a shareholders’ meeting in a non-voting capacity.

Article 8: The Company, beginning from the time it accepts shareholder attendance registrations, shall make an uninterrupted audio and video recording of the registration procedure, the proceedings of the shareholders’ meeting, and the voting and vote counting procedures. The recorded materials of the preceding paragraph shall be retained for at least 1 year. If, however, a shareholder files a lawsuit pursuant to Article 189 of the Company Act, the recording shall be retained until the conclusion of the litigation.

Article 9: Quorum at shareholders’ meetings shall be calculated based on numbers of shares. The quorum shall be calculated according to the shares

indicated by the sign-in cards handed in plus the number of shares whose voting rights are exercised in writing or by way of electronic transmission.

The Chair shall call the meeting to order at the appointed meeting time, and meanwhile shall announce the related information about the total number of shares held by shareholders having no voting right and the total number of shares represented by the shareholders present at the meeting.

However, when the attending shareholders do not represent a majority of the total number of issued shares, the Chair may announce a postponement, provided that no more than two such postponements, for a combined total of no more than 1 hour, may be made. If the quorum is not met after two postponements and the attending shareholders still represent less than one third of the total number of issued shares, the Chair shall declare the meeting adjourned.

If the quorum is not met after two postponements as referred to in the preceding paragraph, but the attending shareholders represent one third or more of the total number of issued shares, a tentative resolution may be adopted pursuant to paragraph 1 of Article 175 of the Company Act; all shareholders shall be notified of the tentative resolution and another shareholders’ meeting shall be convened within 1 month.

When, prior to conclusion of the meeting, the attending shareholders represent a majority of the total number of issued shares, the Chair may resubmit the tentative resolution for a vote by the shareholders’ meeting pursuant to Article 174 of the Company Act.

Article 10: If a shareholders’ meeting is convened by the Board of Director, the meeting agenda shall be set by the Board of Directors. The relevant proposals (including extraordinary motions and amendment to original proposals) shall be decided by voting on a case-by-case basis. The meeting shall proceed in the order set by the agenda, which may not be changed without a resolution of the shareholders’ meeting.

The provisions of the preceding paragraph apply mutatis mutandis to a shareholders’ meeting convened by a party having the convening right that is not the Board of Directors.

The Chair may not declare the meeting adjourned prior to completion of

deliberation on the meeting agenda of the preceding two paragraphs (including extraordinary motions), except by a resolution of the shareholders’ meeting. If the Chair declares the meeting adjourned in violation of the rules of procedure, the other members of the Board of Directors shall promptly assist the attending shareholders in electing a new chair in accordance with statutory procedures, by a majority of the votes represented by the attending shareholders, and then continue the meeting.

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

Article 11: Before speaking, an attending shareholder must specify on a speaker's slip the subject of the speech, his/her shareholder account number (or attendance card number), and account name. The order in which shareholders speak will be set by the Chair.

A shareholder in attendance who has submitted a speaker's slip but does not actually speak shall be deemed to have not spoken. When the content of the speech does not correspond to the subject given on the speaker's slip, the spoken content shall prevail.

Except with the consent of the Chair, a shareholder may not speak more than twice on the same proposal, and a single speech may not exceed 5 minutes. If the shareholder's speech violates the rules or exceeds the scope of the agenda item, the Chair may terminate the speech.

When an attending shareholder is speaking, other shareholders may not speak or interrupt unless they have sought and obtained the consent of the Chair and the shareholder that has the floor; the Chair shall stop any violation.

When a juristic person shareholder appoints two or more representatives to attend a shareholders’ meeting, only one of the representatives so appointed may speak on the same proposal.

After an attending shareholder has spoken, the Chair may respond in person or direct relevant personnel to respond.

Article 12: Voting at a shareholders’ meeting shall be calculated based on the number of shares.

With respect to resolutions of shareholders’ meetings, the number of shares held by a shareholder with no voting rights shall not be calculated as part of the total number of issued shares.

When a shareholder is an interested party in relation to an agenda item, and there is the likelihood that such a relationship would prejudice the interests of the Company, that shareholder may not vote on that item, and may not exercise voting rights as proxy for any other shareholder.
In case a director of the Company has created a pledge on the Company’s shares more than half of the Company’s shares being held by him/her/it at the time he/she/it is elected, the voting power of the excessive portion of shares shall not be exercised.

The number of shares for which voting rights may not be exercised under the preceding two paragraphs shall not be calculated as part of the voting rights represented by attending shareholders.

With the exception of a trust enterprise or a stock agency approved by the competent securities authority, when one person is concurrently appointed as proxy by two or more shareholders, the voting rights represented by that proxy may not exceed 3 percent of the voting rights represented by the total number of voting shares, otherwise, the portion of excessive voting rights shall not be counted.
Article 13: A shareholder shall be entitled to one vote for each share held, except when the shares are restricted shares or are deemed non-voting shares under paragraph 2 of Article 179 of the Company Act.
When the Company convenes a shareholders’ meeting, shareholders shall exercise their voting rights by electronic means and may exercise their voting rights in writing. When voting rights are exercised in writing or by way of electronic transmission, the method for exercising the voting rights shall be specified in the shareholders’ meeting notice. A shareholder exercising voting rights in writing or by way of electronic transmission will be deemed to have attended the meeting in person, but to have waived his/her rights with respect to the extraordinary motions and amendments to original proposals of that meeting.

A shareholder intending to exercise voting rights in writing or by way of

electronic transmission under the preceding paragraph shall deliver a written declaration of intent to the Company no later than 2 days prior to the scheduled shareholders’ meeting date. When duplicate declarations of intent are delivered, the one received earliest by the Company shall prevail, except when a declaration is made to revoke the earlier declaration of intention.

After a shareholder has exercised voting rights in writing or by way of electronic transmission, in the event the shareholder intends to attend the shareholders’ meeting in person, a written declaration of intent to rescind the voting rights already exercised under the preceding paragraph shall be made known to the Company, by the same means by which the voting rights were exercised, no later than 2 days prior to the scheduled shareholders’ meeting date. If the notice of rescission is submitted after that time, the voting rights already exercised in writing or by way of electronic transmission shall prevail. When a shareholder has exercised voting rights both in writing or by way of electronic transmission and by appointing a proxy to attend a shareholders’ meeting, the voting rights exercised by the proxy in the meeting shall prevail.

Except as otherwise provided in the Company Act and in the Company's Articles of Incorporation, the adoption of a proposal shall require an affirmative vote of a majority of the voting rights represented by the attending shareholders. At the time of a vote, for each proposal, the Chair or a person designated by the Chair shall announce the total number of voting rights represented by the attending shareholders, followed by a poll of the shareholders. After the conclusion of the meeting, on the same day it is held, the results for each proposal, based on the numbers of votes for and against and the number of abstentions, shall be entered into the MOPS.

When there is an amendment or an alternative to a proposal, the Chair shall present the amended or alternative proposal together with the original proposal and decide the order in which they will be put to a vote. When any one among them is passed, the other proposals will then be deemed rejected, and no further voting shall be required.

In addition to the proposals on the meeting agenda, when a shareholder wishes to propose an extraordinary motion, the shareholder’s voting

rights shall represent at least 1% or more of the Company’s total issued shares.

Vote monitoring and counting personnel for the voting on a proposal shall be appointed by the Chair, provided that all monitoring personnel shall be shareholders of the Company. Vote counting for shareholders’ meeting proposals or elections shall be conducted in public at the place of the shareholders’ meeting. Immediately after vote counting has been completed, the results of the voting, including the statistical tallies of the numbers of votes, shall be announced on-site at the meeting, and a record made of the vote.

Article 14: The election of directors at a shareholders’ meeting shall be held in accordance with the applicable election and appointment rules adopted by the Company, and the voting results shall be announced on-site immediately, including the names of those elected and not elected as directors, and the numbers of votes with which they were elected and not elected.
The ballots for the election referred to in the preceding paragraph shall be sealed with the signatures of the monitoring personnel and kept in proper custody for at least 1 year. If, however, a shareholder files a lawsuit pursuant to Article 189 of the Company Act, the ballots shall be retained until the conclusion of the litigation.
Article 15: Matters relating to the resolutions of a shareholders’ meeting shall be recorded in the meeting minutes. The meeting minutes shall be signed or sealed by the Chair of the meeting and a copy distributed to each shareholder within 20 days after the conclusion of the meeting. The meeting minutes may be produced and distributed in electronic form. The Company may distribute the meeting minutes of the preceding paragraph by means of a public announcement made through the MOPS. The meeting minutes shall accurately record the year, month, day, and place of the meeting, the Chair's full name, the methods by which resolutions were adopted, and a summary of the deliberations and their results (including the weight of the votes), and the number of weighted votes each candidate received in case of a Directors' elections, and shall be retained for the duration of the existence of the Company.
Article 16: On the day of a shareholders’ meeting, the Company shall compile in

the prescribed format a statistical statement of the number of shares obtained by solicitors through solicitation and the number of shares represented by proxies, and shall make an express disclosure of the same at the place of the shareholders’ meeting.

If matters put to a resolution at a shareholders’ meeting constitute material information under applicable laws or regulations or under TWSE regulations, the Company shall upload the content of such resolution to the MOPS within the prescribed time period.
Article 17: Staff handling administrative affairs of a shareholders’ meeting shall wear identification cards or arm bands.
The Chair may direct the proctors or security personnel to help maintain order at the meeting place. When proctors or security personnel help maintain order at the meeting place, they shall wear an identification card or armband bearing the word "Proctor."
At the place of a shareholders’ meeting, if a shareholder attempts to speak through any device other than the public address equipment set up by the Company, the Chair may prevent the shareholder from so doing. When a shareholder violates the rules of procedure and defies the Chair's correction, obstructing the proceedings and refusing to heed calls to stop, the Chair may direct the proctors or security personnel to escort the shareholder from the meeting.
Article 18: When a meeting is in progress, the Chair may announce a break based on time considerations. If a force majeure event occurs, the Chair may rule the meeting temporarily suspended and announce a time when, in view of the circumstances, the meeting will be resumed.
If the meeting venue is no longer available for continued use and not all of the items (including extraordinary motions) on the meeting agenda have been addressed, the shareholders’ meeting may adopt a resolution to resume the meeting at another venue.
A resolution may be adopted at a shareholders’ meeting to postpone or resume the meeting within 5 days in accordance with Article 182 of the Company Act.
Article 19: These Rules, and any amendments hereto, shall be implemented after adoption by shareholders’ meetings.

Procedures for Acquisition or Disposal of Assets of Formosa Plastics Corporation

Amended by the Annual Shareholders’ Meeting on June 11, 2019

Chapter 1 General Principles

Article 1: When acquiring or disposing of the following assets, Formosa Plastics Corporation (hereinafter referred to as the “Company”) and its subsidiaries shall follow the Procedures for Acquisition or Disposal of Assets (hereinafter referred to as the “Procedures”):
Investments in stocks, government bonds, corporate bonds, bank debentures, securities representing interest in a fund, depositary receipts, call (put) warrants, beneficial interest securities, asset-backed securities, etc.
Real property (including land, houses and buildings, investment property) and equipment.
Memberships.
Patents, copyrights, trademarks, franchise rights, and other intangible assets.
Right-of-use assets.
Claims of financial institutions (including receivables, bills purchased and discounted, loans, and overdue receivables).
Derivatives.
Assets acquired or disposed through mergers, demergers, acquisitions, or assignment of shares in accordance with law.
Other major assets.
Article 2: The limit amount of investments for non-operating real property and right-of-use assets or securities (the original investment), by the Company and each subsidiary, shall not exceed 60% of the book value of total assets; for an individual securities investment, the limit amount shall not exceed 50% of the foresaid limit amount, i.e. 30% of the book value of total assets.
Article 3: Terms used in these Procedures are defined as follows:
Derivatives: Forward contracts, options contracts, futures contracts, leverage contracts, or swap contracts, whose value is derived from a specified interest rate, financial instrument price, commodity price,

foreign exchange rate, index of prices or rates, credit rating or credit index, or other variable; or hybrid contracts combining the above contracts; or hybrid contracts or structured products containing embedded derivatives. The term "forward contracts" does not include insurance contracts, performance contracts, post-sales service contracts, long-term leasing contracts, and long-term purchase (sales) contracts.

Assets acquired or disposed through mergers, demergers, acquisitions, or assignment of shares in accordance with law: Refers to assets acquired or disposed through mergers, demergers, or acquisitions conducted under the Business Mergers and Acquisitions Act, Financial Holding Company Act, Financial Institutions Merger Act and other acts, or to shares acquired from another company through issuance of new shares of its own as the consideration therefor (hereinafter "acquisition of shares") under Article 156-3 of the Company Act.
Related party or subsidiary: As defined in the Regulations Governing the Preparation of Financial Reports by Securities Issuers.
Professional appraiser: Refers to a real property appraiser or other person duly authorized by law to engage in the value appraisal of real property or equipment.
Date of occurrence: Refers to the date of contract signing, date of payment, date of consignment trade, date of transfer, dates of Board of Directors resolutions, or other date that can confirm the counterpart and monetary amount of the transaction, whichever date is earlier; provided, for investment for which approval of the competent authority is required, the earlier of the above date or the date of receipt of approval by the competent authority shall apply.
Mainland China area investment: Refers to investments in the Mainland China area approved by the Ministry of Economic Affairs Investment Commission or conducted in accordance with the provisions of the Regulations Governing Permission for Investment or Technical Cooperation in the Mainland Area.
Article 4: Professional appraisers and their officers, certified public accounts, attorneys, and securities underwriters that provide the Company with

appraisal reports, certified public accountant's opinions, attorney's opinions, or underwriter's opinions in relation to the assets acquired or disposed, shall meet the following requirements:

May not have previously received a final and unappealable sentence to imprisonment for 1 year or longer for a violation of the Act, the Company Act, the Banking Act of The Republic of China, the Insurance Act, the Financial Holding Company Act, or the Business Entity Accounting Act, or for fraud, breach of trust, embezzlement, forgery of documents, or occupational crime. However, this provision does not apply if 3 years have already passed since completion of service of the sentence, since expiration of the period of a suspended sentence, or since a pardon was received.
May not be a related party or de facto related party of the Company.
If the Company is required to obtain appraisal reports from two or more professional appraisers, the different professional appraisers or appraisal officers may not be related parties or de facto related parties of each other.
Article 5: The procedures for the assessment, determination of transaction terms and conditions, and price of acquiring or disposing of assets by the Company shall be in accordance with the following requirements:
Transactions relating to short-term securities investments and derivatives, which are mentioned in Article 1, should be evaluated and executed by the financial department; long-term securities investment should be assessed by the Company’s President Office (“President Office”) and executed by the financial department after the approval; except for the foresaid assets, the other asset transactions should be assessed by the Company’s President Office and executed by the related departments after the approval.
The price of transactions described in the preceding paragraph, except which are traded in the stock exchange or securities brokerage firms, shall be determined via public bidding, price bidding, or price negotiation based on reference to the market conditions.
Article 6: Where an acquisition or disposition of assets of the Company shall be approved by the Board of Directors according to the Procedures or other relevant laws, the independent directors' opinions specifically expressing

dissent or reservations about any matter shall be included in the minutes of the Board of Directors meeting.

A major asset transaction or a major derivatives transaction shall be approved by more than half of all audit committee members and submitted to the Board of Directors for a resolution. If approval of more than half of all audit committee members is not obtained, the procedures may be implemented if approved by more than two-thirds of all Directors, and the resolution of the Audit Committee shall be recorded in the minutes of the Board of Directors meeting.

Chapter 2 Acquisition or Disposal of Assets

Article 7: In acquiring or disposing of real property, equipment, or right-of-use assets thereof where the transaction amount reaches 20 percent of the Company's paid-in capital or NTD 300 million or more, the Company, unless transacting with a domestic government institution, engaging others to build on its own land, engaging others to build on rented land, or acquiring or disposing of equipment or right-of-use assets thereof for business use, shall obtain an appraisal report prior to the date of occurrence of the event from a professional appraiser and shall further comply with the following provisions:
Where due to special circumstances it is necessary to give a limited price, specified price, or special price as a reference basis for the transaction price, the transaction shall be proposed for approval in advance by the Board of Directors; the same procedure shall also be followed for any subsequent changes to the terms and conditions of the transaction.
Where the transaction amount is NTD 1 billion or more, appraisals from two or more professional appraisers shall be obtained.
Where any one of the following circumstances applies with respect to the professional appraiser's appraisal results, unless all the appraisal results for the assets to be acquired are higher than the transaction amount, or all the appraisal results for the assets to be disposed of are lower than the transaction amount, a certified public accountant shall be engaged to perform the appraisal in accordance with the provisions of Statement of Auditing Standards No. 20 published by the Accounting Research and Development Foundation of Republic of

China (ARDF) and render a specific opinion regarding the reason for the discrepancy and the appropriateness of the transaction price:

  - (1) The discrepancy between the appraisal result and the transaction amount is 20 percent or more of the transaction amount.

  - (2) The discrepancy between the appraisal results of two or more professional appraisers is 10 percent or more of the transaction amount.

No more than 3 months may elapse between the date of the appraisal report issued by a professional appraiser and the contract execution date; provided, where the publicly announced current value for the same period is used and not more than 6 months have elapsed, an opinion may still be issued by the original professional appraiser.
Article 8: The Company acquiring or disposing of securities shall, prior to the date of occurrence of the event, obtain financial statements of the issuing company for the most recent period, certified or reviewed by a certified public accountant, for reference in appraising the transaction price, and if the dollar amount of the transaction is 20 percent of the Company's paid-in capital or NTD 300 million or more, the Company shall additionally engage a certified public accountant prior to the date of occurrence of the event to provide an opinion regarding the reasonableness of the transaction price. If the CPA needs to use the report of an expert as evidence, the CPA shall do so in accordance with the provisions of Statement of Auditing Standards No. 20 published by the ARDF. This requirement does not apply, however, to publicly quoted prices of securities that have an active market, or where otherwise provided by regulations of the securities competent authority.
Article 9: In acquiring or disposing of intangible assets or right-of-use assets thereof or membership cards where the transaction amount reaches 20 percent or more of the company's paid-in capital or NTD 300 million or more, the Company, unless transacting with a domestic government institution, shall obtain a CPA’s opinion on the reasonableness of the transaction price prior to the date of occurrence of the event. The CPA shall comply with the provisions of Statement of Auditing Standards No. 20 published by the Accounting Research and Development Foundation.
Article 10: The calculation of the transaction amounts referred to in the preceding

three articles shall be done in accordance with paragraph 2 of Article 28, herein, and "within the preceding year" as used herein refers to the year preceding the date of occurrence of the current transaction. Items for which an appraisal report from a professional appraiser or a CPA's opinion has been obtained need not be counted toward the transaction amount.

Article 11: Where the Company acquires or disposes of assets through court auction procedures, the evidentiary documentation issued by the court may be substituted for the appraisal report or CPA opinion.
Article 12: Where the Company acquires or disposes of assets shall be conducted by the authorization to the Chairman by the Board of Directors in accordance with the authorization limits of the Company.

Chapter 3 Related Party Transactions

Article 13: When the Company engages in any acquisition or disposal of assets from or to a related party, in addition to ensuring that the necessary resolutions are adopted and the reasonableness of the transaction terms is appraised in compliance with the provisions of the Chapter 2 and this Chapter, if the transaction amount reaches 10 percent or more of the Company's total assets, the Company shall also obtain an appraisal report from a professional appraiser or a CPA's opinion in compliance with the provisions of Chapter 2.
The calculation of the transaction amount referred to in the preceding paragraph shall be made in accordance with Article 10.
Article 14: When the Company intends to acquire or dispose of real property or right-of-use assets thereof from or to a related party, or when it intends to acquire or dispose of assets other than real property or right-of-use assets thereof from or to a related party and the transaction amount reaches 20 percent or more of paid-in capital, 10 percent or more of the Company's total assets, or NTD 300 million or more, except in trading of domestic government bonds or bonds under repurchase and resale agreements, or subscription or repurchase of money market funds issued by domestic securities investment trust enterprises, the Company may not proceed to enter into a transaction contract or make a payment until the following matters have been approved by the Board of Directors:
The purpose, necessity and anticipated benefit of the acquisition or

disposal of assets.

The reason for choosing the related party as a trading counterparty.
With respect to the acquisition of real property or right-of-use assets thereof from a related party, information regarding appraisal of the reasonableness of the preliminary transaction terms in accordance with Article 15 through 17.
The date and price at which the related party originally acquired the real property, the original trading counterparty, and that trading counterparty's relationship to the Company and the related party.
Monthly cash flow forecasts for the year commencing from the anticipated month of signing of the contract, and evaluation of the necessity of the transaction, and reasonableness of the funds utilization.
An appraisal report from a professional appraiser or a CPA's opinion obtained in compliance with the preceding article.
Restrictive covenants and other important stipulations associated with the transaction.

The calculation of the transaction amounts referred to in the preceding paragraph shall be made in accordance with paragraph 2 of Article 28 herein, and "within the preceding year" as used herein refers to the year preceding the date of occurrence of the current transaction. Items that have been approved by the Board of Directors need not be counted toward the transaction amount.

With respect to the types of transactions listed below, when to be conducted between the Company and its parent or subsidiaries, or between its subsidiaries in which it directly or indirectly holds 100 percent of the issued shares or authorized capital, the Company's Board of Directors may pursuant to Article 12, delegate the Chairman to decide such matters when the transaction is within a certain amount and have the decisions subsequently proposed to and ratified by the next Board of Directors meeting:

Acquisition or disposal of equipment or right-of-use assets thereof held for business use.
Acquisition or disposal of real property right-of-use assets held for business use.

When a matter is proposed for discussion by the Board of Directors

pursuant to paragraph 1 of this Article, the independent Directors' opinions specifically expressing dissent or reservations about any matter shall be included in the minutes of the Board of Directors meeting.

The matters for which paragraph 1 requires submitted to the Board of Directors for a resolution shall first be approved by more than half of all audit committee members. If the approval by more than half of all audit committee members is not obtained, the aforesaid matter may be implemented if approved by more than two-thirds of all Directors, and the resolution of the Audit Committee shall be recorded in the minutes of the Board of Directors meeting.

Article 15: The Company shall evaluate the reasonableness of the transaction costs by the following means if it intends to acquire real property or right-of-use assets thereof from a related party:
Based upon the related party's transaction price plus necessary interest on funding and the costs to be duly borne by the buyer. "Necessary interest on funding" is imputed as the weighted average interest rate on borrowing in the year the company purchases the property; provided, it may not be higher than the maximum non-financial industry lending rate announced by the Ministry of Finance.
Total loan value appraisal from a financial institution where the related party has previously created a mortgage on the property as security for a loan; provided, the actual cumulative amount loaned by the financial institution shall have been 70 percent or more of the financial institution's appraised loan value of the property and the period of the loan shall have been 1 year or more. However, this shall not apply where the financial institution is a related party of one of the trading counterparties.

Where land and structures thereupon are combined as a single property purchased or leased in one transaction, the transaction costs for the land and the structures may be separately appraised in accordance with either of the means listed in the preceding paragraph.

When acquiring real property or right-of-use assets thereof from a related party, the Company shall evaluate the cost of the real property or right-of-use assets thereof in accordance with the preceding two paragraphs and shall also engage a CPA to review the evaluation and

render a specific opinion.

Article 16: Where the Company acquires real property or right-of-use assets thereof from a related party and one of the following circumstances exists, the acquisition shall be conducted in accordance with Article 14, and Article 15 does not apply:
The related party acquired the real property or right-of-use assets thereof through inheritance or as a gift.
More than 5 years have elapsed from the time the related party signed the contract to obtain the real property or right-of-use assets thereof to the signing date for the current transaction.
The real property is acquired through signing of a joint development contract with the related party, or through engaging a related party to build real property, either on the company's own land or on rented land.
The real property right-of-use assets for business use are acquired by the Company with its parent or subsidiaries, or by its subsidiaries in which it directly or indirectly holds 100 percent of the issued shares or authorized capital.
Article 17: When the results of the Company's appraisal conducted in accordance with paragraph 1 and paragraph 2 of Article 15 are uniformly lower than the transaction price, the matter shall be handled in compliance with Article 18. However, where the following circumstances exist, and objective evidence has been submitted and specific opinions on reasonableness have been obtained from a professional real property appraiser and a CPA, Article 16 shall not apply:
Where the related party acquired undeveloped land or leased land for development, it may submit proof of compliance with one of the following conditions:
- (1) Where undeveloped land is appraised in accordance with the means in the preceding two articles, and structures according to the related party's construction cost plus reasonable construction profit are valued in excess of the actual transaction price. The "Reasonable construction profit" shall be deemed the average gross operating profit margin of the related party's construction division over the most recent 3 years or the gross profit margin for

the construction industry for the most recent period as announced by the Ministry of Finance, whichever is lower.

  - (2) Transactions by unrelated parties within the preceding year involving other floors of the same property or neighboring or closely valued parcels of land, where the land area and transaction terms are similar after calculation of reasonable price discrepancies in floor or area land prices in accordance with standard property market sale or leasing practices.

Where the Company acquiring real property, or obtaining real property right-of-use assets through leasing, from a related party provides evidence that the terms of the transaction are similar to the terms of transactions for the acquisition of neighboring or closely valued parcels of land of a similar size by unrelated parties within the preceding year.
Transactions for neighboring or closely valued parcels of land in the preceding paragraph in principle refers to parcels on the same or an adjacent block and within a distance of no more than 500 meters or parcels close in publicly announced current value; transaction for similarly sized parcels in principle refers to transactions completed by unrelated parties for parcels with a land area of no less than 50 percent of the property in the planned transaction; within the preceding year refers to the year preceding the date of occurrence of the acquisition of the real property or right-of-use assets thereof.
Article 18: Where the Company acquires real property or right-of-use assets thereof from a related party and the results of appraisals conducted in accordance with the preceding three Articles are uniformly lower than the transaction price, the following steps shall be taken:
A special earnings reserve shall be set aside in accordance with paragraph 1 of Article 41 of the Securities and Exchange Act against the difference between the real property or right-of-use assets thereof transaction price and the appraised cost, and such difference may not be distributed or used for capital increase by issuance of new shares. Where the Company uses the equity method to account for its investment in another company, then the special earnings reserve called for under paragraph 1 of Article 41 of the Securities and

Exchange Act shall be set aside pro rata in a proportion consistent with the share of public company's equity stake in the other company.

Audit Committee shall supervise the Company’s execution of the aforesaid matter.
Actions taken pursuant to the preceding two subparagraphs shall be reported to a shareholders meeting, and the details of the transaction shall be disclosed in the annual report and any investment prospectus.

The Company having set aside a special earnings reserve under the preceding paragraph may not utilize the special earnings reserve until it has recognized a loss on decline in market value of the assets it purchased or leased at a premium, or they have been disposed of, or the leasing contract has been terminated, or adequate compensation has been made, or the status quo ante has been restored, or there is other evidence confirming that there was nothing unreasonable about the transaction, and the securities competent authority has given its consent.

When the Company obtains real property or right-of-use assets thereof from a related party, it shall also comply with the preceding two paragraphs if there is other evidence indicating that the acquisition was not an arm’s length transaction.

Chapter 4 Engaging in Derivatives Trading

Article 19: Any derivatives trading of the Company shall be conducted in accordance with the “Procedures for Engaging in Derivatives Transactions” of the Company, and when doing so, the Company shall pay attention to issues of risk management and auditing to fulfill the Internal Control System of the Company.

Chapter 5 Mergers and Consolidations, Splits, Acquisitions, and Assignment of Shares

Article 20: The Company that conducts a merger, demerger, acquisition, or assignment of shares shall, prior to convening the Board of Directors to resolve on the matter, engage a CPA, attorney, or securities underwriter to give an opinion on the reasonableness of the share exchange ratio, acquisition price, or distribution of cash or other property to shareholders, and propose the opinion to the Board of Directors for deliberation and approval. However, the requirement of obtaining an aforesaid opinion on reasonableness issued by an expert may be

exempted in the case of a merger by the company of a subsidiary in which it directly or indirectly holds 100 percent of the issued shares or authorized capital, and in the case of a merger between subsidiaries in which the Company directly or indirectly holds 100 percent of the respective subsidiaries’ issued shares or authorized capital.

Article 21: The Company participating in a merger, demerger, or acquisition shall prepare a public report to shareholders detailing important contractual content and matters relevant to the merger, demerger, or acquisition prior to the shareholders meeting, together with the expert opinion referred to in Article 20 when sending notice of the shareholders meeting, for reference in deciding whether to approve the merger, demerger, or acquisition. Provided, where a provision of another act exempts a company from convening a shareholders meeting to approve the merger, demerger, or acquisition, this restriction shall not apply. Where the shareholders meeting of any one of the companies participating in a merger, demerger, or acquisition fails to convene or pass a resolution due to lack of a quorum, insufficient votes, or other legal restriction, or the proposal is rejected by the shareholders meeting, the Company shall immediately publicly explain the reason, the follow-up measures, and the preliminary date of the next shareholders meeting.
Article 22: When the Company participates in a merger, demerger, or acquisition, it shall convene a board of directors meeting and shareholders meeting on the same date on which the other companies participating in the merger, demerger, or acquisition convene their board of directors and shareholders meeting to resolve matters relevant to the merger, demerger, or acquisition, unless another act provides otherwise or the securities competent authority is notified in advance of extraordinary circumstances and grants consent.
The Company and other companies participating in an assignment of shares shall call their respective board of directors meeting on the same day, unless another act provides otherwise or the securities competent authority is notified in advance of extraordinary circumstances and grants consent.
When the Company participates in a merger, demerger, acquisition, or assignment of shares, it shall prepare a full written record of the

following information and retain the record for 5 years for reference. In addition, the information set out in the subparagraphs 1 and 2 of the following paragraph shall be reported in the prescribed format and via the Internet-based information system to the securities competent authority for recordation within two days commencing immediately from the date of passage of a resolution by the Board of Directors.

Basic identification data for personnel: Including the occupational titles, names, and national ID numbers (or passport numbers in the case of foreign nationals) of all persons involved in the planning or implementation of any merger, demerger, acquisition, or assignment of shares prior to disclosure of the information.
Dates of material events: Including the signing of any letter of intent or memorandum of understanding, the engagement of a financial or legal advisor, the execution of a contract, and the convening of a board of directors meeting.
Important documents and minutes: Including merger, demerger, acquisition, and share transfer plans, any letter of intent or memorandum of understanding, material contracts, and minutes of board of directors meetings.
Where the Company participating in a merger, demerger, acquisition, or assignment of shares is neither listed on an exchange nor has its shares traded on an OTC market, the Company shall enter into an agreement with such party and shall comply with the preceding paragraph of this Article.
Article 23: Every person participating in or privy to the plan for merger, demerger, acquisition, or assignment of shares shall issue a written undertaking of confidentiality and may not disclose the content of the plan prior to public disclosure of the information and may not trade, in their own name or under the name of another person, in any stock or other equity security of any company related to the plan for merger, demerger, acquisition, or assignment of shares.
Article 24: When participating in a merger, demerger, acquisition, or assignment of shares, the Company shall not arbitrarily alter the share exchange ratio or acquisition price unless under the below-listed circumstances, and shall stipulate the circumstances permitting alteration in the contract for

the merger, demerger, acquisition, or assignment of shares:

Capital increase by cash injection, issuance of convertible corporate bonds, or the issuance of stock dividend, issuance of corporate bonds with warrants, preferred shares with warrants, stock warrants, or other equity based securities.
An action, such as a disposal of major assets that affects the company's financial operations.
An event, such as a major disaster or major change in technology that affects shareholder equity or share price.
An adjustment where any of the companies participating in the merger, demerger, acquisition, or assignment of shares buys back treasury stock.
An increase or decrease in the number of entities or companies participating in the merger, demerger, acquisition, or assignment of shares.
Other terms/conditions that the contract stipulates may be altered and that have been publicly disclosed.
Article 25: The contract for participation by the Company in a merger, demerger, acquisition, or assignment of shares shall record the rights and obligations of the companies participating in the merger, demerger, acquisition, or assignment of shares, and shall also record the following: 1. Handling of breach of contract.
Principles for the handling of equity-type securities previously issued or treasury stock previously bought back by any company that is extinguished in a merger or that is demerged.
The amount of treasury stock participating companies are permitted under law to buy back after the record date of calculation of the share exchange ratio, and the principles for handling thereof.
The manner of handling changes in the number of participating entities or companies.
Preliminary progress schedule for plan execution, and anticipated completion date.
Scheduled date for convening the legally mandated shareholders meeting if the plan exceeds the deadline without completion, and relevant procedures.

Article 26: After public disclosure of the information, if the Company participating in the merger, demerger, acquisition, or assignment of shares intends further to carry out a merger, demerger, acquisition, or assignment of shares with another company, all of the participating companies shall carry out anew the procedures or legal actions that had originally been completed toward the merger, demerger, acquisition, or assignment of share ; except that where the number of participating companies is decreased and a participating company's shareholders meeting has adopted a resolution authorizing the Board of Directors to alter the limits of authority, such participating company may be exempted from calling another shareholders meeting to resolve on the matter anew.
Article 27: Where any of the companies participating in a merger, demerger, acquisition, or assignment of shares is not a public company, the Company shall sign an agreement with the non-public company in accordance with the provisions of Article 22, Article 23, and Article 26.

Chapter 6 Public Disclosure of Information

Article 28: Under any of the following circumstances, the Company acquiring or disposing of assets shall publicly announce and report the relevant information on the securities competent authority's designated website in the appropriate format as prescribed by regulations within 2 days commencing immediately from the date of occurrence of the event:
Acquisition or disposal of real property or right-of-use assets thereof from or to a related party, or acquisition or disposal of assets other than real property or right-of-use assets thereof from or to a related party where the transaction amount reaches 20 percent or more of paid-in capital, 10 percent or more of the Company's total assets, or NTD 300 million or more; provided, this shall not apply to trading of domestic government bonds or bonds under repurchase and resale agreements, or subscription or repurchase of money market funds issued by domestic securities investment trust enterprises.
Merger, demerger, acquisition, or assignment of shares.
Losses from derivatives trading reaching the limits on aggregate losses or losses on individual contracts set out in the procedures adopted by the Company.
Where equipment/machinery or right-of-use assets thereof for

business use are acquired or disposed of, and furthermore the trading counterparty is not a related party, and the transaction amount is more than NTD 1 billion.

Where land is acquired under an arrangement on engaging others to build on the company's own land, engaging others to build on rented land, joint construction and allocation of housing units, joint construction and allocation of ownership percentages, or joint construction and separate sale, and furthermore the trading counterparty is not a related party, and the amount the Company expects to invest in the transaction is more than NTD 500 million.
An asset transaction other than any of those referred to in the preceding five subparagraphs, a disposal of receivables by a financial institution, or an investment in the mainland China area where the transaction amount reaches 20 percent or more of paid-in capital or NTD 300 million or more, provided this shall not apply to the following circumstances:
(1) Trading of domestic government bonds.
(2) Trading of bonds under repurchase/resale agreements or the subscription or repurchase of money market funds issued by domestic securities investment trust enterprises.

The amount of transactions above shall be calculated as follows:

The amount of any individual transaction.
The cumulative transaction amount of acquisitions and disposals of the same type of underlying asset with the same trading counterparty within the preceding year.
The cumulative transaction amount of real property or right-of-use assets thereof acquisitions and disposals (cumulative acquisitions and disposals, respectively) within the same development project within the preceding year.
The cumulative transaction amount of acquisitions and disposals (cumulative acquisitions and disposals, respectively) of the same security within the preceding year.
"Within the preceding year" as used in the paragraph 2 refers to the year preceding the date of occurrence of the current transaction. Items duly announced in accordance with these Procedures need not be counted toward the transaction amount.

Article 29: When the Company at the time of public announcement makes an error or omission in an item required by regulations to be publicly announced and so is required to correct it, all the items shall be again publicly announced and reported in their entirety within two days from the date when is the Company becomes aware of the error or omission.
Article 30: The Company acquiring or disposing of assets shall keep all relevant contracts, meeting minutes, log books, appraisal reports and CPA, attorney, and securities underwriter opinions at the company headquarters, where they shall be retained for 5 years except where another act provides otherwise.
Article 31: Where any of the following circumstances occurs with respect to a transaction that the Company has already publicly announced and reported in accordance with the preceding three Articles, a public report of relevant information shall be made on the information reporting website designated by the securities competent authority within 2 days commencing immediately from the date of occurrence of the event:
Change, termination, or rescission of a contract signed in regard to the original transaction.
The merger, demerger, acquisition, or assignment of shares is not completed by the scheduled date set forth in the contract.
Change to the originally publicly announced and reported information.

Chapter 7 Additional Provisions

Article 32: Information required to be publicly announced and reported in accordance with the provisions of the preceding Chapter on acquisitions and disposals of assets by a subsidiary of the Company that is not a public company in Taiwan shall be reported by the Company.
The paid-in capital or total assets of the Company shall be the standard for determining whether or not a subsidiary referred to in the preceding paragraph is subject to the threshold requiring a public announcement and regulatory filing under paragraph 1 of Article 28.
Article 33: The Company’s controlling and monitoring procedures towards the acquisition or disposal of assets by its subsidiaries are as follows:
The Company shall urge its subsidiaries to establish and execute their own “Procedures for Acquisition of Disposal of Assets”.
If any material violation is found by the internal auditors of the

subsidiaries, the subsidiaries shall deliver a written notice to the Company of this kind of violation. The Company shall know the condition of dealing with the violation(s) and of the resulting improvements.

Article 34: Should there be any violation of the procedures when the persons-in-charge of the Company deal with acquisition or disposal of assets, subsequent penalization is subject to the relevant HR policies of the Company.
Article 35: For the calculation of 10 percent of total assets under this Procedures, the total assets stated in the most recent parent company only financial report or individual financial report prepared under the Regulations Governing the Preparation of Financial Reports by Securities Issuers shall be used.
Article 36: After the Procedures are approved by the Board of Directors, the Procedures shall be submitted to the Shareholders Meeting for approval before its implementation. Any amendment is subject to the same procedure. The independent directors' opinions specifically expressing dissent or reservations about any matter shall be included in the minutes of the Board of Directors meeting.
The matters for which paragraph 1 requires submitted to the Board of Directors for a resolution shall first be approved by more than half of all audit committee members. If the approval by more than half of all audit committee members is not obtained, the procedures may be implemented if approved by more than two-thirds of all Directors, and the resolution of the Audit Committee shall be recorded in the minutes of the Board of Directors meeting.

Formosa Plastics Corporation Current Shareholdings of Directors

Title	Name	Shareholding (share)
Chairman	Jason Lin	0
Managing Director	William Wong Representative of Formosa Chemicals & Fibre Corporation	486,978,694
Managing Director	Susan Wang Representative of Nan Ya Plastics Corporation	294,793,105
Managing Director	Wilfred Wang Representative of Formosa Petrochemical Corporation	131,460,365
Managing Director (Independent Director)	C. L. Wei	0
Independent Director	C. J. Wu	0
Independent Director	Yen-ShiangShih	0
Independent Director	Wen-Chyi Ong	0
Director	C. T. Lee	1,906,541
Director	Cher Wang	7,369,380
Director	K. H. Wu	134,537
Director	Ralph Ho	27,824,363
Director	Sang-Chi Lin	0
Director	JerryLin	0
Director	Cheng-ChungCheng	0

Note: According to Article 26 of Securities and Exchange Act, the minimum of the Directors are shareholdings Company’s 101,851,853 shares. As of April 11, 2022, the actual shareholdings of the Company’s Directors are 950,466,985 shares.

Information regarding the Proposed Employees and Directors’ Compensation to Adopted by the Board of Directors of the Com an p y:

Amounts of employees’ cash compensation, stock compensation, and Directors’ com ensation: p

Company:	Company:
1. Amounts of employees’ cash compensation, stock compensation, and Directors’ compensation:
Employees Cash Compensation	NTD 110,562,838
Employees Stock Compensation	NTD 0
Directors Cash Compensation	NTD 0
2. Share amount of the employees’ stock compensation and the percentage of the share amount to that of all stock dividends capitalization:
Share amount of employees’ stock compensation	0 share
Percentage of the share amount to that of all stock dividends capitalization	0%

The above-listed amount of employees’ cash compensation is consistent with the proposed amount adopted by the Board of Directors of the Company.

Effect upon Business Performance and Earnings Per Share of the Company by the Stock Dividend Distribution Proposed at the 2022 Annual Shareholders’ Meeting:

Not applicable since the Company does not propose the stock dividend distribution at the 2022 Annual Shareholders’ Meeting and does not required to prepare financial forecast information.

AI assistant

FPC — AGM Information 2022

51762_rns_2022-06-14_61081bb3-98fc-458f-8666-389cbd07a1d6.pdf

FORMOSA PLASTICS CORPORATION

2022 ANNUAL SHAREHOLDERS’ MEETING

MEETING HANDBOOK

Table of Contents

FORMOSA PLASTICS CORPORATION

2022 ANNUAL SHAREHOLDERS’ MEETING PROCEDURE

FORMOSA PLASTICS CORPORATION

2022 ANNUAL SHAREHOLDERS’ MEETING AGENDA

1. Report Items

2. Ratification Items

3. Discussion Items

Report Items

Formosa Plastics Corporation 2021 Business Report

1. 2021 Business Report:

2. Business Performance:

3. 2022 Business Performance Target and Outlook:

Formosa Plastics Corporation

Audit Committee’ Review Report

Ratification Items Proposal 1

Explanation:

Resolution:

Ratification Items Proposal 2

Attachment:

Resolution:

Discussion Items Proposal 1

Resolution:

Discussion Items Proposal 2

Resolution:

Consolidated Statements of Comprehensive Income

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars, Except for Earnings Per Common Share)

(English Translation of Financial Statements and Report Originally Issued in Chinese) FORMOSA PLASTICS CORPORATION

Statements of Comprehensive Income

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars , Except for Earnings Per Common Share)

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) FORMOSA PLASTICS CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the years ended December 31, 2021 and 2020

(English Translation of and Report Originally Issued in Chinese) FORMOSA PLASTICS CORPORATION

Statements of Cash Flows

For the years ended December 31, 2021 and 2020

Formosa Plastics Corporation Statement of Profits Distribution For the year of 2021

KPMG

Independent Auditors’ Report

Opinion

Basis for Opinion

Key Audit Matters

1. Revenue Recognition

2. Valuation of Inventories

Other Matter

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

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

KPMG

Notes to Readers

KPMG

Independent Auditors’ Report

Opinion

Basis for Opinion

Key Audit Matters

1. Revenue recognition

Other Matter

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

Auditors’ Responsibilities for the Audit of the Financial Statements

KPMG

Notes to Readers

Articles of Association of

Formosa Plastics Corporation

Chapter I General Provisions

Classified

Chapter II Shares

Chapter III Shareholders Meeting

Chapter IV Directors

Chapter V (Omitted)

Chapter VI Manager

Chapter VII Accounting

Chapter VIII Miscellaneous

Rules of Procedure for Shareholders’ Meetings of Formosa Plastics Corporation

FPC AGM Information 2022