HannsTouch - AGM Information 2022

HannsTouch Solution Incorporated

2022 Annual General Shareholders’ Meeting Meeting Handbook

Annual General Shareholders’ Meeting 2022 Stock ID: 3049 Type of meeting: In person Time: 9.00 a.m.., May 24, 2022 Venue: No. 7, Beiyuan 1st Road (Southern Taiwan Science Park), Shanhua District, Tainan City 74149

------Disclaimer----

This is a translation of the 2021 Annual General Shareholders’ Meeting Handbook of HannsTouch solution Inc.. The translation is for Reference only. If there is any discrepancy between the english version and chinese version, The chinese version shall prevail.

Meeting Procedure and Agenda .................................................................................................................. 1 Report Items ................................................................................................................................................ 2 Ratification and Discussion Items .............................................................................................................. 4 Extraordinary Motions .............................................................................................................................. 13 Appendices

I.	Business Report for 2021 ............................................................................................................. 14
	Consolidated Financial Statements and Independent Auditor's Report ..................................... 22
	Standalone Financial Statements and Independent Auditor's Report ......................................... 34
II.	Audit Committee’s Report ........................................................................................................... 46
III.	Remuneration of Individual Directors ......................................................................................... 47
IV.	Private Placement of Unsecured Ordinary Corporate Bonds ....................................................... 48
V.	Ethical Corporate Management Best Practice Principles ............................................................. 50
	Procedures for Ethical Management and Guidelines for Conduct ............................................... 57
VI.	Fund Utilization Plan, Progress and Expected Benefits for Cash Capital Increase ................... 65
VII.	Comparison Table of Amendments to Articles of Incorporation ................................................. 66
VIII.	Articles of Incorporation (Before Amendments) ......................................................................... 71
IX.	Comparison Table of the Regulations Governing the Acquisition and Disposal of Assets .......... 78
X.	Regulations Governing the Acquisition and Disposal of Assets (Before Amendments) ............. 92
XI.	Actions of Directors for Himself or on Behalf of Another Person that is Within the
	Scope of the Company's Business .............................................................................................. 114
XII.	Rules and Procedures of Shareholder Meetings......................................................................... 115
XIII.	Shareholdings of Directors and Independent Directors ............................................................. 123

HannsTouch Solution Incorporated

Meeting Procedure and Agenda of 2022 Annual General Shareholders’ Meeting

Time: 9.00 a.m., May 24, 2022 (Tuesday)

Venue: No. 7, Beiyuan 1st Road (Southern Taiwan Science Park), Shanhua District, Tainan City 74149 Meeting Procedure:

(I) Call Meeting to Order
(II) Chairperson’s Address
(III) Report Items:
Business Report for 2021.
Audit Committee’s Review Report of Audited Financial Statements for 2021.
Status Report on the Distributions of Employee Compensation and Director Remuneration for 2021.
Status Report on Earnings Distribution for 2021.
Status Report on Offering of Unsecured Ordinary Corporate Bonds.
Other Report Items.
(IV) Ratification and Discussion Items:
Ratification for Business Report and Financial Statements for 2021.
Ratification for earnings distribution for 2021.
Discussion of proposal to carry out a cash capital increase by issuing common shares through private placement, public offering, or a combination of both.
Discussion of amendments to the Articles of Incorporation.
Discussion of amendments to the Regulations Governing the Acquisition and Disposal of Assets.
Discussion of lift of non-competition restrictions for Directors.
(V) Extraordinary Motions
(VI) Adjournment

[Report Items]

I. 2021 business report

For Business Report for 2021, please see Attachment 1 on page 14 of the Handbook.

II. Audit Committee’s Review Report of Audited Financial Statements for 2021.

For Audit Committee’s review report, please see Attachment 2 on page 46 of the Handbook.

III. Status report on the distributions of employee compensation and Director remuneration for 2021.
In accordance with Articles of Incorporation, Article 29, if the Company is profitable for the year, it shall appropriate 0.001% to 15% of the profit as employee compensation and not more than 2% as Director remuneration. By resolution of the Board meeting on February 22, 2022, the earnings distribution of the Company for 2021 is as follows:

Item	Amount	Percentage over profit for the fiscalyear %
Employee compensation - cash	54,000,000	4.2%
Director Remuneration - Cash	19,600,000	1.5%

The remuneration policy, and content and amount of individual Directors:

The Director remuneration policy complies with the Company Act and Articles of Incorporation, and takes into account the annual performance assessment results (including the Director’s performance in the comprehension of the Company’s targets, missions and duties, the participation level of the management, fostering and communication of internal working relationship, professionalism and continuing education, internal control and other factors). The Remuneration Committee shall make the proposal pertaining to the Directors’ remuneration, which shall be executed after the resolution is passed by the Board of Directors. For remuneration of individual Directors, please see Attachment 3 on page 47 of the Handbook.

IV. Status Report on Earnings Distribution for 2021.
As per the Articles of Incorporation, Article 30, “The Company may distribute all or part of its dividends, profits, capital reserves or legal reserves in cash, provided that such decision is resolved in a board meeting with at least two-thirds of directors present, supported by more than half of attending directors, and reported during a shareholders’ meeting afterwards. These decisions do not

require the shareholders’ meeting resolution mentioned in the preceding Paragraph.” “The Company may distribute earnings or reimburse losses at the end of each half-year, subject to compliance with the Company Act.”, authorizing the Board of Directors to resolve the earnings distribution by cash at the end of each half-year. The half-year cash dividends for 2021 resolved by the Board of Directors are as follows:

Year	Date of resolution by the board (Year/month/day)	Cash dividend per share (NTD)	Total cash dividend (NTD)
First half of the year for 2021	(not distributed)	-	-
Second half of the year for 2021	February 22, 2022	0.35	282,431,985

For the cash dividend disbursement, the Chairperson shall be authorized to determine the exdividend and distribution dates. If the Company buys back the shares, or due to other factors, thus affecting the number of outstanding shares and causing a change in the cash distributed per share, the Chairperson shall be authorized to make adjustments according to the number of outstanding shares as at the ex-dividend date.

V. Status Report on Offering of Unsecured Ordinary Corporate Bonds.

For the first unsecured ordinary corporate bonds in 2017, as of December 31, 2021, the Company had redeemed and retired all of the bonds in advance. For more details on the first and second secured ordinary corporate bonds in 2021, please see Attachment 4 on page 48 in the Handbook.

VI. Other report items:

On July 26, 2021, the Annual General Shareholders’ Meeting passed a resolution, whereby for not exceeding 80 million shares, the Company shall “carry out a cash capital increase by issuing common shares through private placement, public offering, or a combination of both” to cater to the development of strategic alliances and the expansion of working capital. Considering the timing of issuance, the Company has yet to submit an application to the competent authority for the issuance. This is to inform that to provide flexibility to the Company in adjusting itself to the changes in the industry and economic climate. Another proposal shall be made for discussion. As

such, the original fundraising plan cannot be carried out within the remaining time period.

For the 2022 Annual General Shareholders’ Meeting, during the proposal acceptance period announced by the Company, no shareholder has submitted a written application for a proposal for discussion pursuant to the Company Act, Article 172-1 and 192-1.
By resolution of the Board meeting on November 5, 2021, the Company has established Ethical Corporate Management Best Practice Principles and Procedures for Ethical Management and Guidelines for Conduct. For more details, see Attachment 5 from pages 50 to 64 of the Handbook.

[Ratification and Discussion Items]

Proposal 1: Proposed by the Board of Directors

Item: Ratification for Business Report and Financial Statements for 2021.

Description:

The Financial Statements for 2021 of the Company have been audited by Ching-Chang Chen and Fu-Ming Liao from PwC Taiwan. The aforementioned Financial Statements and Business Reports have been ratified by the Board of Directors on February 22, 2022 and submitted to the Audit Committee for review.
For Business Report and Financial Statements for 2021, please see Attachment 1 from pages 14 to 45 of the Handbook.

Resolution:

Proposal 2: Proposed by the Board of Directors

Item: Ratification for earnings distribution for 2021.

Description:

The earnings distribution for 2021 proposed by the Company is as follows:

HannsTouch Solution Incorporated Earnings Distribution Table

HannsTouch Solution Incorporated Earnings Distribution Table
Year 2021,	unit: NT$
Item	Amount
Undistributed earnings at the beginning of the period (January 1, 2021) Net profit after tax for 2021 - first half of the year Net profit after tax for 2021 - second half of the year Appropriated as legal reserve (10%) Reversal of special reserve	$599,613,294 585,414,940 414,983,260 (100,039,820) $6,456,800
Undistributed earnings at the end of the period	$1,506,428,474
Distribution item First half of 2021: Shareholders- Cash dividend (not distributed) Second half of 2021: Shareholders - Cash dividend(NT$0.35per share)	0 (282,431,985)
Undistributed earnings at the end of theperiod(December 31,2021)	$1,223,996,489

(Note) The cash dividends will be calculated to the nearest NT dollar (rounded down). The total of fractional cash dividends less than NT$1 shall be transferred to the Company's other earnings.

Chairman: WeiHsin Ma President: Lien-Hsiang, Lien Head of Accounting: Ting-Xian Liu

The proposal was resolved by the Board on February 22, 2022 and submitted to the Audit Committee for review, which has since been completed.
After the proposal is approved by resolution in General Shareholders’ Meeting, the Chairperson shall be authorized to determine the ex-dividend and distribution dates. Subsequently, in the event that the Company buys back the shares, or due to other factors, thus affecting the number of outstanding shares and causing a change in the cash distributed per share, the Chairperson shall be authorized to make adjustments according to the number of outstanding shares as at the ex-dividend date.

Resolution:

Proposal 3: Proposed by the Board of Directors

Item: Discussion on the proposal to carry out a cash capital increase by issuing common shares through

private placement, public offering, or a combination of both.

Description:

I. To cater to the development of strategic alliances, the expansion of working capital and other capital needs, the Company proposes, not exceeding 80 million shares and with a face value of NT$10, to carry out a cash capital increase by issuing common shares through private placement, public offering, or a combination of both, or sponsoring issuance of overseas depositary receipt. The fund utilization plan and the expected benefits of capital increase has been made tentatively. Please see Attachment 6 on page 65 of the Handbook.
II. The Company proposes to request the Annual General Shareholders’ Meeting for 2022 to authorize the Board of Directors in selecting an option or a combination of options from the following methods and principles to raise funds:
(I) If the Company opts to carry out a cash capital increase by issuing common shares through private placement to raise capital: In accordance with the Securities and Exchange Act, Article 43-6, a private placement of common shares shall be carried out within one year from the date of the resolution of the Annual General Shareholders’ Meeting.
1. Reasons for private placement:
  - (1) Reasons for not selecting public offerings: The expediency and convenience of private placement in fulfilling the objectives of introducing strategic investors, as well as the restriction imposed on the transfer of securities of private placement within three years and the long-term cooperative relationship with strategic investors, are taken into consideration. Further, authorizing the Board of Directors to coordinate the private placement according to actual business needs would effectively increase the mobility and flexibility of the Company's fundraising activities.
  - (2) Amount of private placement: not exceeding 80 million common shares.
  - (3) Fund utilization and expected benefit of private placement:
    - A. Purpose of the funds: For the use of developing strategic alliances.
    - B. Expected benefits: To cater to the fast-changing industry environment, introducing strategic investors at a suitable time may strengthen the technologies, sales and marketing and supplies of key components that the Company needs for its business, thus enhancing its competitive advantages.
2. The basis and reasonableness of the price set: Considering the restriction imposed on the transfer of ownership, the principle of setting the issue price for the common shares is not to be lower than 80% of the higher of the following two calculations:
  - (1) The simple average closing price for either the one, three, or five business

days before the price determination date, after adjustment for any distribution of stock dividends, cash dividends or capital reduction.

(2) The simple average closing price for the 30 business days before the price determination date, after adjustment for any distribution of stock dividends, cash dividends, or capital reduction.

However, without violating the aforementioned principle, for the actual price-fixing date and issue price, it is proposed to the Annual General Shareholders’ Meeting to authorize the Board of Directors to set the price according to the market condition at the time, as well as the provision above. Based on the closing prices of the Company’s shares recently, the issue price may be lower than the par value of the common shares. Considering that the circulation of common shares issued through private placement is lower, the issue price is deemed reasonable as it is determined in accordance with “Directions for Public Companies Conducting Private Placements of Securities.”

Method for selecting the specific persons: Selection is made in accordance with the Securities and Exchange Act, Article 43-6.
The Company shall source placement from strategic investors that are able to strengthen the technologies, sales and marketing and supplies of key components that the Company needs in its business. The Board of Directors is authorized to review the qualification of potential appointees.

The objectives, necessity and expected benefits of selecting qualified strategic investors using the aforementioned method are to cater to the long-term development needs of the Company. The Company shall tap into the knowledge, technology, branding or distribution channels of the strategic investors to assist the Company in improving its technology, product quality, cost reduction, the stability of key component supplies, efficiency, and market expansion.

The rights and responsibilities for the common shares issued through the private placement are, in principle, the same as the common shares that the Company has issued previously. However, in accordance with the Securities and Exchange Act, for the common shares issued through the private placement, except for the parties as stipulated by the Securities and Exchange Act, Article 43-8, a three-year restriction is imposed on the transfer of the shares after issuance. Three years after issuance, in accordance with the Securities and Exchange Act, the Company shall apply for permission from the competent authority to publicly trade the common shares issued through the private placement.
(II) If the Company opts for carrying out a cash capital increase by issuing common shares through a public offering to raise capital:

The Company proposes to request the Annual General Shareholders’ Meeting for 2021 to authorize the Board of Directors to select an option or a combination of

options from the following methods and principles to raise funds. Depending on the Company's needs, the Board may undertake the issuance in single or multiple closings:

If the Company opts for carrying out a domestic cash capital increase by issuing common shares to raise capital:

The Company proposes to the Annual General Shareholders’ Meeting to authorize the Board of Directors to conduct the issuance by means of either book building or subscription.

(1) By means of book building: In accordance with the Company Act, Article 267, 10% to 15% of the new shares issued shall be reserved for subscription by employees of the Company. In accordance with the Securities and Exchange Act, Article 28-1, the remaining 85% to 90% of the new shares shall be offered publicly by means of book building. If there is an insufficient subscription by employees, the Chairperson is authorized to open the purchase of new shares to specific persons according to the issue price. In accordance with Taiwan Securities Association Regulations Governing the Self-Regulatory of Underwriters Advising Public Offering and Securities Issuance (hereafter, “Securities Association Self-Regulatory Regulations”), the issue price shall not be lower than 90% of the simple average closing price for either the one, three, or five business days before the price determination base date, after adjustment for any distribution of stock dividends, cash dividends (or capital reduction). For the actual issue price, subsequently to the book building period, the Chairperson is authorized to consult with the underwriter in taking into consideration the status of the book building and the condition of the issuance market and make a final decision afterward.
(2) By means of subscription: In accordance with the Company Act, Article 267, 10% to 15% of the new shares issued shall be reserved for subscription by employees of the Company. In accordance with the Securities and Exchange Act, Article 28-1, 10% of the new shares shall be publicly offered, while the remaining 75% to 80% of the new shares shall be offered for subscription to the existing shareholders (based on the shareholders’ register as at the base date of subscription) according to their shareholding percentage. If the subscription is less than one share or there is an insufficient subscription, the Chairperson is authorized to open the purchase of new shares to specific persons according to the issue price. In accordance with the Securities Association Self-Regulatory Regulations, the issue price shall not be lower than 70% of the simple average closing price for either the one, three, or five business days before the price determination base date, after adjustment for any distribution of stock dividends, cash dividends (or capital reduction). For the actual issue price and terms of issuance, the Chairperson is authorized

to consult with the underwriter to consider the condition of the market and make a final decision afterward.

If the Company opts for sponsoring issuance of overseas depositary receipts (hereafter, “GDR”) for cash capital increase:

The Company proposes to the Annual General Shareholders’ Meeting that depending on the market conditions and the capital needs of the Company, to carry out a cash capital increase by sponsoring the issuance of GDR in accordance with the Articles of Incorporation and the relevant law and regulations. In accordance with the Company Act, Article 267, 10% to 15% of the new shares issued shall be reserved for subscription by employees of the Company. In accordance with the Securities and Exchange Act, Article 28-1, the existing shareholders forfeit the subscription rights. All of the remaining new shares shall be publicly offered as the securities of the GDR issuance. For the subscription rights to new shares forfeited by employees, the Company proposes to authorize the Chairperson to open the purchase of new shares to specific persons, or depending on the market need, sponsor the issuance of GDR.

In accordance with the Securities Association Self-Regulatory Regulations, the issue price shall not be lower than 90% of the simple average closing price for either the one, three, or five business days before the price determination date, after adjustment for any distribution of stock dividends, cash dividends (or capital reduction). However, for the actual issue price, the Chairperson is authorized to consult with the underwriter in taking into consideration the condition of the market and make a final decision afterward.

To coordinate the issuance of GDR, the Company proposes to authorize the Chairperson or designate a representative to sign agreements or documentation pertaining to the sponsoring of GDR issuance and other relevant matters.

Pertaining to the proposal of cash capital increase by issuing common shares or issuance plan of GDR, terms and conditions of issuance, quantity, issue price, the total amount of funds to be raised, the purpose of the funds, project particulars, implementation schedule, expected benefits, the record date of the capital increase and other related matters, including amendments made in accordance with instructions from the competent authority or a change in market condition and environment, the Company shall propose to the Annual General Shareholders’ Meeting to authorize the Board of Meeting for the undertaking.
III. In response to market changes, giving rise to a necessity whereby the issue price fall lower than the par value, it is reasonable for the Company to opt not to raise funds via the issuance of bonds due to considerations for maintaining steady management and a secure financial structure. If the issue price is set to be lower than par value, the Company shall

comply with the regulations stipulated by the competent authority in determining the issue price. After the benefit of a capital increase is evident, the Company's financial structure shall improve substantially, which shall be beneficial to the Company's longterm growth. As such, it shall also be beneficial to the interest of the shareholders.

IV. If the ceiling of the number of new shares issued is set at 80 million shares, using the outstanding ordinary shares as of February 22, 2022, the maximum share dilution effect shall amount to 9.914%. Considering the funds raised are intended for the development of strategic alliances or the expansion of working capital, it is thus beneficial to the shareholders’ interest. As such, the issue of new shares shall not give rise to a significant share dilution effect.
V. For the issue price of the issuance (except for fixed price), terms and conditions of issuance, issuance method and other matters, such as the change in law and regulations, the opinion of the competent authority or the change in market conditions, the Company proposes to authorize the Board of Directors to take full charge in managing these matters as applicable.
VI. This proposal was resolved by the Board of Directors meeting on February 22, 2022.

Resolution:

Proposal 4: Proposed by the Board of Directors

Item: Discussion on the amendments to the Articles of Incorporation. Description:

In accordance with the Company Act, Article 172-2 and Article 356-8 amended on December 29, 2021, and Article 41 of Securities and Exchange Act, the Company has amended the Articles of Incorporation pursuant to the Corporate Governance Evaluation Indicators, etc.
For comparison table of Amendments to Articles of Incorporation, please see Attachment 7 on page 66 of the Handbook.
This proposal was resolved by the Board of Directors meeting on February 22, 2022.

Resolution:

Proposal 5: Proposed by the Board of Directors

Item: Discussion on the proposal of amendments to the Regulations Governing the Acquisition and Disposal of Assets.

Description:

In accordance with the Financial Supervisory Commission (FSC) per JGZFZ Document No.1110380465 dated January 28, 2022 on Regulations Governing the Acquisition and Disposal of Assets by Public Companies, the Company has made corresponding amendments to its own regulations.
For a comparison table of the Regulations Governing the Acquisition and Disposal of Assets, please see Attachment 9 on page 78 of the Handbook.
This proposal was resolved by the Board of Directors meeting on February 22, 2022.

Resolution:

Proposal 6: Proposed by the Board of Directors

Item: Discussion on lifting the non-competition restrictions for Directors. Description:

Pursuant to the Company Act, Article 209, Paragraph 1, “A director who does anything for himself or on behalf of another person that is within the scope of the company's business, shall explain to the meeting of shareholders the essential contents of such an act and secure its approval.”
For newly elected Directors who also assume concurrent director or manager positions in entities that engage in similar business activities as the Company, please see Attachment 11 on page 114 of the Handbook.
The Company proposes to the Annual General Shareholders’ Meeting to lift noncompetition restrictions for the Directors, and not to seek disgorgement payments from the Directors for the period since they start holding concurrent positions in other entities.

Resolution:

[Extraordinary Motions]

[Adjournment]

[Attachment 1]

HannsTouch Solution Incorporated

Business Report for 2021

I. 2021 business report
(I) Outcome of the business plan:

HannsTouch is a manufacturer of high-end AMOLED touch sensors dedicated to the development of new production technology, strengthening cost control capability, enhancement of production efficiency and management of delivery, product quality and yield, thus providing customers with the best technology and services.

For the first half of 2021, the global smart phone market made a strong rebound from the slump in 2020. However, in the second half, the COVID-19 pandemic deteriorated in many regions around the world. Compounded by chip shortage and inflation anxiety, the overall smartphone market for the year remained flat. However, international brands have consistently introduced the technology of AMOLED panels into their products. The trend of high-end mobile phones remains unchanged. The overall market share of AMOLED panels continues to grow. As the market demand continues to increase, the Company shall consistently refine its production yield, improve the utilization rate, and develop more advanced technologies to satisfy the future needs of customers.

The Company seeks to further enhance the operating performance and circular change of quarterly demand fluctuation, maintain a high utilization rate and therefore fully utilize the functions of new equipment, develop new production and product technologies consistently, establish a new product platform, increase operating effectiveness and realize long-term profitability goals.

In the first quarter of 2021, the Company successfully integrated HannsTouch’s backplane for electronic shelf label (ESL) display in design-in products for many customers. Starting from the second quarter, the effort translated into operating contribution. As the high demand for ESL is rapidly driven by many major merchandisers, in 2021, the Company made plans to invest NT$800 million for ESL production expansion project, whereby the production capacity shall grow twofold. The Company is expected to increase its yearly revenue by 10%. In February 2022, the Company was expected to complete installation and certification, and start production.

Hopefully, in 2022, with the ubiquity of vaccination keeping the pandemic under control, the Company can thus, increase its operating performance. With management that is based on the principle of stability and integrity, the Company seeks to achieve great performance by collaborating with customers and sharing its business results with the shareholders.

(II) Revenues, expenses, and profitability analysis:

	Assessment \ Year	2020	2021
Financial position (%)	Debt to assets ratio	44.29	34.12
	Long-term capital to property, plants and equipment	142.67	149.02
Solvency (%)	Current ratio	294.16	533.72
	Quick ratio	283.52	510.92
Profitability (%)	Return on assets	2.48	6.21
	Return on shareholders’ equity	3.62	9.69
	Net profit margin	11.34	26.49
	Earningsper share(NTD)	0.43	1.24

In 2021, the Company mainly engaged in the development, research, manufacturing and sales of touch sensors. The net operating revenue for 2021 amounted to NT$3,775,822 thousand. The operating costs amounted to NT$2,477,053 thousand. The gross profit amounted to NT$1,298,769 thousand. The gross profit margin amounted to 35%. The operating profit amounted to NT$1,003,305 thousand. The operating profit margin amounted to 27%. The total comprehensive income amounted to NT$1,272,158 thousand.

(III) Research and development:

HannsTouch Solution possesses the generation 5.5 OCTA touch sensor (1300x1500mm) manufacturing plant that can fabricate products that come in different sizes, such as smartwatches, smartphones, and notepads. In the meantime, via flexible design and production, it can satisfy the demands of different production lines of multiple generation AMOLED plants, creating optimal benefits. The main sizes of touch-control products manufactured correspond to the high-end smartphones and wearable products with AMOLED. It contains characteristics such as narrow linewidth, narrow bezel, and high transmittance. The Company shall continue to develop advanced Hole in Active Area (HIAA), full-screen display smartphones and Touch and Display Driver Integration (TDDI) and other technical applications on smartphones, collaborating with main customers in satisfying their requirements and developing touch-control products with low-impedance

Apart from OCTA touch-control glass sensing products, the Company targets the niche product market for application technology and develops the relevant technologies and products for the backplane for ESL display with thin-film transistors (TFT). For technology development wise, the Company has successfully utilized the high mobility technology, which can effectively improve TFTs' functions and is beneficial to the design of high-resolution products and give rise to a low energy consumption advantage. In terms of product development, taking advantage of the close packing design, ESL back panel products have been successfully introduced, making the best out of the optimal cutting rate of G5.5 (1300x1500mm). For industrial touch sensors not under the OCTA product line, the Company has developed several types of industrial computer application touch-control products. The mass production of this series of products has been quite stable. Moreover, the high-end aerial touch-control application products that the Company has ventured into will continue to be tested by the end customers, so as to increase the value-add of the

products.

Furthermore, with highly automated and precise equipment, in 2021, the Company has developed: (1) a new fabrication technology for flexible TFTs and backplane for ESL display, building a new generation of flexible products and technology platforms; (2) the TFT backplane for in-display optical fingerprint recognition sensor, thus increasing the diversified development of products.

II. Summary of 2022 business plan

Looking ahead, in 2022, with the ubiquity of vaccination, the COVID-19 pandemic shall be under control. Compounded by new 5G smartphones launched by many international brands that are foreseen to drive up purchases of new phones, the sales of OCTA products are expected to have much room for growth. In the ESL market, as the pandemic has expedited the willingness and speed of terminal end customers in changing devices, and the high demand for ESL has been rapidly driven by many major merchandisers, expediting the expansion project and maintaining high utilization rate shall be our focus.

In 2020, international brands were turning to set 5G smartphones as their flagship products, thus fortifying the 5G smartphone era. In 2021, the trend of the increasing market share of smartphones using AMOLED remained consistently unchanged. Apart from solidifying its position in the medium to the high-end smartphone market, Rigid AMOLED is also heading toward application in tablets and notebooks, increasing AMOLED's penetration rate in IT products and further enhancing the scope of product application of AMOLED. In 2022, the growth trend is expected to continue.

HannsTouch Solution has been deepening its effort in ESL display products for many years and thus, is able to secure customer orders. Via reducing production capacity that is subject to the cyclical effect of quarterly demand fluctuation, which in turn will affect the utilization rate, it is expected that the sales percentage of subsequent newly added product platforms can enable the optimization of production capacity and full utilization of equipment capacity, hence improving the Company’s sales, operating performance and profitability.

Further, for the application market of industrial and automobile professional display and touch-control solutions, the Company has also been working closely with customers in its endeavor in technology development. In 2021, its long-term revenue growth was evident, and the development diversity is promising. HannsTouch Solution shall consistently deepen its roots in technology and diversity developments.

(I) Operational guidelines:

The main product line of HannsTouch Solution comprises high-end AMOLED touch sensors. The Company shall continue to upgrade its product and technical specifications. Via the expansion of production capacity, the Company shall actively secure new market share. Furthermore, via its advantage in high precision equipment, the Company shall develop new production and product technologies, build new product lines, and increase and improve product application combinations, thus increasing the overall operating performance and the return on equity.

The Company has consistently developed the technologies and market of touch sensors and display products in professional sectors to enhance the technological value-add and business diversity of the Company.
With fulfilling customer satisfaction as its management philosophy, the Company provides a complete series of services and technologies for touch-control products, from development and design to fabrication. The Company is thus able to cater to customer needs in terms of production flexibility, steady supply, diversity in product series and cost competitiveness, therefore enhancing the Company’s competitive advantage in production.
Using TFT backplane technology as the new technology platform, the Company develops new related products, such as the backplane for ESL display and optical fingerprint on display, providing customers with more comprehensive solutions.
Building a business with sustainable and steady development for shareholders.
(II) Key production/sales policies:

Apart from supplying OCTA products to the existing AMOLED customers, the generation 5.5 production line also coordinates with the Company’s long-term development strategy in partially manufacturing TFT backplane products, satisfying the needs of new customers. In 2021, the Company will head toward diversifying its customer base and developing product applications so as to mitigate risks, adjust for quarterly demand change, stabilize revenue stream and continue to expand a higher share of major customers, as well as consistently developing the new scope of product applications.

Furthermore, in response to demand for new products, the Company has made plans to invest NT$800 million for ESL production expansion project this year. The production capacity is estimated to increase from 5,000 pieces per month to 10,000 pieces per month. The installation and certification are expected to be complete at year end, and in February 2022, mass production shall commence. The facility shall provide new application technologies, products and services, developing professional market demand and satisfying customer demand.

III. Future strategies, and impacts of the competitive environment, regulatory environment and the overall business environment

(I) Competitive advantages of HannsTouch Solution:
High quality automated professional production lines The Company is one of the few businesses globally that has fully automated production plants for manufacturing touch sensors. The building design of the production plants took into consideration accommodating the equipment capacity for fabricating high-end TFT and automated production lines so as to satisfy customer needs for high yield and quality in AMOLED touch sensors and TFT backplane, thus guaranteeing a reliable and steady supply to customers.

To cater to rapid demand change in technology and the market, the Company adopts AI to coordinate

production scheduling and quality enhancement system so as to increase the management capability of the production line. The Company also seeks to consistently improve the business information systems (BIS). From value-adding decision making system for new products to the e-commercialization of procurement, logistics and business management platform systems, and from full automation of production lines to smart monitoring systems, the Company consistently take on intellectualization challenges at all frontiers in hopes of utilizing minimally diversified, rapid and stable production model to increase the customer capability in responding to market changes.

Competitive advantage in cost reduction

Manufacturing high-quality products and constantly improving yield are fundamental commitments of HannsTouch Solution to its customers. Apart from consistently optimizing the parameters of production allocation and materials, the Company also expands its production capacity, and automates and intellectualizes production lines and procedures to advance the production efficiency and increase the overall competitive advantage.

In addition to the touch-control technology, the Company also seeks to develop the fabrication technology of TFT components superior to other foundries, allowing platforms of new generation flexible products and technology to gain more competitive advantages and secure new business opportunities in the application market.

The Company shall develop relationships with suppliers of new materials and implement certification standards for Authorized Economic Operator (AEO) to ensure diversification in high quality and steady supplies, reduce production cost and create better profitability. With more experience and better

capabilities in maintaining its own production facilities, the Company is able to achieve proper cost control.

High value-adding technology platform

Apart from generation 5.5 glass backplane with a thickness of 0.25mm, the Company has also managed to make use of narrow linewidth, narrow bezel, high transmittance technology for mass-producing OCTA, realizing the application of OCTA for high-end products. Currently, the Company is also providing customers with various verification platforms for new product technologies, assisting the technology development of verification to satisfy the need for product diversification, product specifications of different customers, and the glass of different generations to provide further production technology services.

Meanwhile, under the foundation of highly automated and precise equipment, in 2021, with the fabrication technology of TFT components and backplane for ESL display, the Company shall continue to develop the related flexible product technology platform, widening the product application.

High-efficiency operation management

The Company has gained years of experience working with many international mega brands and possesses the most professional fabrication technology and manufacturing management capabilities. The Company has been consistently engaging in quality improvement. Apart from complying with ISO 9001 regulations, the factory has implemented a fully automated functional testing in a scrupulous

manner and shall continue to add more testing equipment with functions strengthened, so as to ensure the utmost quality for the fabrication of products. In the future, the Company shall continue to strengthen smart management and preventive management. Via a consistent effort in optimization of production efficiency and cost reduction, the Company seeks to further improve the overall operation efficiency, and constantly pursue energy conservation along with carbon reduction as the Company works to achieve operating growth whilst contributing to environmental sustainability.

(II) Future business development strategy:

Operating model

With a steady customer group and demand, HannsTouch Solution is able to put in place equipment capacity that can cater to product lines of generations 4.5, 5.5 and 6. It strives to become a manufacturer of OCTA touch sensors that caters to professional sectors and the sole business that provides AMOLED production lines of multiple generations to customers, thus securing a key role in the supply chain of the OCTA market.

To lower the cyclical effect in quarterly demand fluctuation of the consumer smartphone market, increase operating performance and build a steady long-term profitability profile, under the foundation of highly automated and precise equipment, the Company shall develop new TFT components and their fabrication technology and build various new product platforms to add new value to customers. Furthermore, via internal and external resources and collaboration, the Company widens product applications, expands ESL display, industrial and automobile application markets, develops new application scopes for professional displays, and provides more diversified technologies, products and services, heads toward providing comprehensive solutions. The Company targets to become a supplier of professional sensors and display solutions, thus improving the value-add both internally and externally. Meanwhile, the Company invested in Glorystone Inc. to enter the hospitality industry. By moving closer to consumers, it develops a new business model that can complement other sectors in which the Group is in and therefore is able to foster a more valuable ecology.

Technology development

Apart from leading in the mass production of 0.25mm slimmed glass substrate and production capability of refined line width and narrow bezel products, HannsTouch Solution shall continue to develop advanced HIAA technology and full-screen display smartphones. TDDI and other smartphone technology applications have passed the customers’ verification and gone into mass production. The end product applications are adopted by the world’s main smartphone brands, thus becoming the leading supplier of touch-control products. For the backplane market for electronic ink label, the Company is on par with its industry counterparts in using a lower photomask fabrication method, and the products have passed the customers’ verification. Thus, the market share is expected to increase gradually.

Furthermore, under the foundation of highly automated and precise equipment, the Company has developed high mobility fabrication technology and product platform for TFT components and flexible

substrates. In 2022, the Company shall use the product platform and further apply the backplane for flexible TFT components and optical fingerprint in display sensors, thus adding value to products. In the future, the Company shall coordinate the aforementioned technologies to further develop new optical and medical sensor technology. The Company shall also deepen its research in the technological fields and diversify development to service a more diversified clientele.

Service model

To cater to product development diversification, the Company shall adjust its customer service system to strengthen customer relationships. In addition to shortening the delivery period and enhancing yield, the Company shall also focus on sales and marketing strategy, crystallize the direction of product development, and search for new niche markets to satisfy new operation strategy development. Further, the Company shall also expand the scope of technological service, determine the direction of technology development, add new value to the product platform for customers, and foster a more steadfast and trusting relationship with customers so as to increase the long-term operating performance of the Company.

By consistently improving BIS, the Company continues to optimize and intellectualize the product development process to cater to the needs for the diversification of product platforms, shorten the time for product development and delivery, satisfy the needs of customers in shortening the time for a fastpaced cyclical product launch and the design verification of end product brands, provide a comprehensive production profile and secure key parameters of production and products for quick retrospective tracing and feedback.

The Company shall seek to strengthen the professional in product management and professionalism of customer service. From improving product design development, mass production and after-sales service, to expediting the response to customers and execution of solutions to problems, and establishing a timely reporting mechanism, the Company aims to build a trusting and interactive rapport, understand the production problem facing customers and provide timely and necessary services. Meanwhile, via the collaborative processes, the Company can consistently improve its own capabilities and play key roles in the supply chain, and implement certification standards for AEO, in hopes of becoming a trusting business partner that can gain customers’ approval.

Chairman: WeiHsin Ma

President: Lien-Hsiang, Lien Head of Accounting: Ting-Xian Liu

HannsTouch Solution Incorporated

Declaration of Consolidated Financial Statements of Affiliated Enterprises

For the year ended December 31, 2021, pursuant to “Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises,” the Company that is required to be included in the consolidated financial statements of affiliates, is the same as the Company required to be included in the consolidated financial statements of parent and subsidiary companies under International Financial Reporting Standard No. 10. And if relevant information that should be disclosed in the consolidated financial statements of affiliates has all been disclosed in the consolidated financial statements of parent and subsidiary companies, it shall not be required to prepare separate consolidated financial statements of affiliates.

Hereby declare,

HannsTouch Solution Incorporated Representative: February 22, 2022

INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE

To the Board of Directors and Shareholders of HannsTouch Solution Incorporated

Opinion

We have audited the accompanying consolidated balance sheets of HannsTouch Solution Incorporated and subsidiaries (the “Group”) as at December 31, 2021 and 2020, and the related consolidated statements of comprehensive income, of changes in equity and of cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at December 31, 2021 and 2020, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission.

Basis for opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and generally accepted auditing standards 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 Norm of Professional Ethics for Certified Public Accountant of the Republic of China, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Group’s 2021 consolidated financial statements. These matters were addressed in the context of our audit of the consolidated financial statements as a whole and, in forming our opinion thereon, we do not provide a separate opinion on these matters.

Key audit matters for the Group’s 2021 consolidated financial statements are stated as follows:

Key Audit Matter – Appropriateness of cut-off of overseas warehouse operating revenue

Description

Refer to Note 4(31) for accounting policy on revenue recognition in the financial statements.

The Group stores inventories in the warehouses under the custody of foreign third parties. Such inventories are checked and accepted by the custodians in order to meet the requirements of overseas sales customers. The custodians regularly send inventory reports to the Group to verify the quantity, and the Group recognises operating revenue based on actual inventories used at customer side which are shown in the inventory report provided by the custodians.

As the process of revenue recognition arising from Group’s foreign warehouse involves numerous manual procedures, we considered the appropriateness of cut-off of overseas warehouse operating revenue recognition as a key audit matter.

How our audit addressed the matter:

We performed the following audit procedures on the above key audit matter:

Obtained an understanding of and evaluated the Group’s procedures on overseas warehouse operating revenue, and selected samples to check the accuracy of operating revenue recognition.
Performed cut-off procedures on sales revenue from distribution warehouse recognised during a specific period before and after the period-end, including verifying delivery schedule of distribution warehouse and ensuring the movements of inventories contained in the statements and cost of goods sold had been recognised in the appropriate period; and
Performed confirmation for significant warehouses.

Key audit matter- Impairment assessment on property, plant and equipment

Description

Refer to Notes 4(19), 5(2) and 6(8) for accounting policy applied on impairment of property, plant and equipment, accounting estimates and assumptions applied on the impairment assessment of tangible assets and details of impairment.

The Group has appointed appraisers to appraise the property, plant and equipment in Taipei and to value the recoverable amount as the basis for assessing the impairment of property, plant and equipment.

The recoverable amount is calculated through income approach and comparison method. The determination of the recoverable amount is subject to management judgement and uncertainty, which could have a significant impact in assessing whether there is any impairment loss on property, plant and equipment. Thus, we considered the impairment assessment of property, plant and equipment as a key

audit matter.

How our audit addressed the matter:

We understood the basis and process of management’s assessment and performed the following audit procedures in respect of the above key audit matter:

Assessed the expected future income used in the experts’ appraisal report and compared with local market price and forecast documents for the industry.
Assessed the discount rate used in the experts’ appraisal report and inspected the assumptions of cost of capital with return on similar assets in the market.
Examined the parameters of valuation model in the experts’ appraisal report and setting of formulas.

Other matter – Parent company only financial reports

We have audited and expressed an unqualified opinion on the parent company only financial statements of HannsTouch Solution Incorporated as at and for the years ended December 31, 2021 and 2020.

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 the Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission, 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.

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 generally accepted auditing standards 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 the generally accepted auditing standards 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 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.

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 auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Chen, Ching Chang Liao, Andy

For and on behalf of PricewaterhouseCoopers, Taiwan February 22, 2022

Chen, Ching Chang[Liao, Fu-Ming ]

For and on Behalf of PricewaterhouseCoopers, Taiwan April 11, 2022

The accompanying consolidated financial statements are not intended to present the financial position and results of operations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions other than the Republic of China. The standards, procedures and practices in the Republic of China governing the audit of such financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic of China. Accordingly, the accompanying consolidated financial statements and independent auditors’ report are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in the Republic of

China, and their applications in practice.

As the financial statements are the responsibility of the management, PricewaterhouseCoopers cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.

HANNSTOUCH SOLUTION INCORPORATED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

Assets	Notes 6(1) 6(2) 6(4) 6(5) 7 7 6(6) 6(11) 6(7) and 8 6(2) 6(3) 6(8) and 8 6(9) 6(25)	December 31, 2021 AMOUNT $ 1,843,653 71,107 2,255,907 328,325 184 10,335 1,074 204,452 - 44,957 26,103 4,786,097 96,109 778,137 10,549,981 293,534 15,189 96,277 2,950 11,832,177 $ 16,618,274	December 31, 2020
			AMOUNT
Current assets 1100 Cash and cash equivalents 1110 Financial assets at fair value through profit or loss - current 1136 Current financial assets at amortised cost, net 1170 Accounts receivable, net 1180 Accounts receivable - related parties 1200 Other receivables 1210 Other receivables - related parties 130X Inventory 1460 Non-current assets or disposal groups classified as held for sale, net 1476 Other current financial assets 1479 Other current assets 11XX Total current assets Non-current assets 1510 Non-current financial assets at fair value through profit or loss 1517 Non-current financial assets at fair value through other comprehensive income 1600 Property, plant and equipment 1755 Right-of-use assets 1780 Intangible assets 1840 Deferred income tax assets 1900 Other non-current assets 15XX Total non-current assets 1XXX Total assets			$ 1,789,028 55,505 664,832 252,068 16,894 32,560 - 198,729 2,575,574 59,390 39,350
			5,683,930
			- 193,411 10,862,154 335,723 17,377 333,480 3,398
			11,745,543
			$ 17,429,473

(Continued)

HANNSTOUCH SOLUTION INCORPORATED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

Liabilities and Equity	Notes 6(2) 7 6(13) 7 6(15) 7 6(14) and 7 6(15) 6(25) 6(17) 6(18) 6(19) 9 11	December 31, 2021 December 31, 2020 AMOUNT AMOUNT $ 8 $ 1 1,703 217 159,990 136,660 - 2,486 401,179 372,424 1,194 1,964 24,844 25,895 15,179 30,794 251,015 233,333 41,631 1,128,467 896,743 1,932,241 1,500,000 900,000 2,972,282 4,526,667 55 779 284,929 311,971 16,329 47,127 4,773,595 5,786,544 5,670,338 7,718,785 8,069,485 8,069,485 312,925 312,925 144,361 109,361 6,457 14,100 1,600,011 941,680 217,756 ( 6,457) 10,350,995 9,441,094 596,941 269,594 10,947,936 9,710,688 $ 16,618,274 $ 17,429,473	December 31, 2020
			AMOUNT
Current liabilities 2120 Financial liabilities at fair value through profit or loss - current 2150 Notes payable 2170 Accounts payable 2180 Accounts payable - related parties 2200 Other payables 2220 Other payables - related parties 2230 Current income tax liabilities 2280 Current lease liabilities 2320 Long-term liabilities, current portion 2399 Other current liabilities 21XX Total current liabilities Non-current liabilities 2530 Corporate bonds payable 2540 Long-term borrowings 2570 Deferred income tax liabilities 2580 Non-current lease liabilities 2670 Other non-current liabilities 25XX Total non-current liabilities 2XXX Total liabilities Equity Equity attributable to owners of parent Share capital 3110 Common stock Capital surplus 3200 Capital surplus Retained earnings 3310 Legal reserve 3320 Special reserve 3350 Unappropriated retained earnings Other equity interest 3400 Other equity interest 31XX Equity attributable to owners of the parent 36XX Non-controlling interest 3XXX Total equity Significant contingent liabilities and unrecognised contract commitments Significant events after the balance sheet date 3X2X Total liabilities and equity			$ 1 217 136,660 2,486 372,424 1,964 25,895 30,794 233,333 1,128,467
			1,932,241
			900,000 4,526,667 779 311,971 47,127
			5,786,544
			7,718,785
			9,441,094 269,594
			9,710,688
			$ 17,429,473

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

HANNSTOUCH SOLUTION INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

YEARS ENDED DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars, except for earnings per share amounts)

Items	Year ended December 31 2021 2020 Notes AMOUNT AMOUNT 6(20) and 7 $ 3,775,822 $ 3,086,399 6(6)(24) and 7 ( 2,477,053) ( 2,375,024) 1,298,769 711,375 6(24) and 7 ( 36,360) ( 27,311) ( 225,154) ( 224,588) ( 33,939) ( 40,679) ( 11) 45 ( 295,464) ( 292,533) 1,003,305 418,842 6(21) 10,371 3,463 6(22) 176,598 153,745 6(23) and 7 162,251 ( 16,183) 7 ( 70,540) ( 97,247) 278,680 43,778 1,281,985 462,620 6(25) ( 234,040) ( 102,874) $ 1,047,945 $ 359,746 6(3) $ 225,827 ( $ 8,071) 6(25) ( 1,614) 1,614 $ 1,272,158 $ 353,289 $ 1,000,398 $ 350,004 $ 47,547 $ 9,742 $ 1,224,611 $ 343,547 $ 47,547 $ 9,742 6(26) $ 1.24 $ 0.43 $ 1.23 $ 0.43
4000 Sales revenue 5000 Operating costs 5950 Net operating margin Operating expenses 6100 Selling expenses 6200 General and administrative expenses 6300 Research and development expenses 6450 (Impairment loss) impairment gain and reversal of impairment loss determined in accordance with IFRS 9 6000 Total operating expenses 6900 Operating profit Non-operating income and expenses 7100 Interest income 7010 Other income 7020 Other gains and losses 7050 Finance costs 7000 Total non-operating income and expenses 7900 Profit before income tax 7950 Income tax expense 8200 Profit for the year 8316 Unrealised gains (losses) from investments in equity instruments measured at fair value through other comprehensive income 8349 Income tax related to components of other comprehensive income that will not be reclassified to profit or loss 8500 Total comprehensive income for the year Profit attributable to: 8610 Owners of the parent 8620 Non-controlling interest Comprehensive income attributable to: 8710 Owners of the parent 8720 Non-controlling interest Basic earnings per share 9750 Basic earnings per share 9850 Diluted earnings per share

Items

Year ended December 31
2021
2020
Notes
AMOUNT
AMOUNT
6(20) and 7
$ 3,775,822
$ 3,086,399
6(6)(24) and 7
(
2,477,053) (
2,375,024)
1,298,769
711,375
6(24) and 7
(
36,360) (
27,311)
(
225,154) (
224,588)
(
33,939) (
40,679)
(
11)
45
(
295,464) (
292,533)
1,003,305
418,842
6(21)
10,371
3,463
6(22)
176,598
153,745
6(23) and 7
162,251 (
16,183)
7
(
70,540) (
97,247)
278,680
43,778
1,281,985
462,620
6(25)
(
234,040) (
102,874)
$ 1,047,945
$ 359,746
6(3)
$ 225,827 ( $ 8,071)
6(25)
(
1,614)
1,614
$ 1,272,158
$ 353,289
$ 1,000,398
$ 350,004
$ 47,547
$ 9,742
$ 1,224,611
$ 343,547
$ 47,547
$ 9,742
6(26)
$ 1.24
$ 0.43
$ 1.23
$ 0.43

4000
Sales revenue
5000
Operating costs
5950
Net operating margin
Operating expenses
6100
Selling expenses
6200
General and administrative
expenses
6300
Research and development
expenses
6450
(Impairment loss) impairment
gain and reversal of impairment
loss determined in accordance
with IFRS 9
6000
Total operating expenses
6900
Operating profit
Non-operating income and
expenses
7100
Interest income
7010
Other income
7020
Other gains and losses
7050
Finance costs
7000
Total non-operating income
and expenses
7900
Profit before income tax
7950
Income tax expense
8200
Profit for the year
8316
Unrealised gains (losses) from
investments in equity
instruments measured at fair
value through other
comprehensive income
8349
Income tax related to
components of other
comprehensive income that will
not be reclassified to profit or
loss
8500
Total comprehensive income for
the year
Profit attributable to:
8610
Owners of the parent
8620
Non-controlling interest
Comprehensive income attributable
to:
8710
Owners of the parent
8720
Non-controlling interest
Basic earnings per share
9750
Basic earnings per share
9850
Diluted earnings per share

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

HANNSTOUCH SOLUTION INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY YEARS ENDED DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

Notes					Equity attr	utable to owners o	ft	he parent							Non-controlling interest
	Share capital - common stock			Capital Reserves				Retained Earnings				Unrealised gains (losses) from financial assets measured at fair value through other comprehensive income		Total
		Total capital surplus, additional paid-in capital		Capital surplus, difference between consideration and carrying amount of subsidiaries acquired or disposed	Capital surplus, others	Legal reserve		Special reserve		Unappropriated retained earnings
6(19) 6(19) 6(29)	$ 8,069,485 - - - - - $ 8,069,485 $ 8,069,485 - - - - - - - $ 8,069,485		$ 309,035 - - - - - $ 309,035 $ 309,035 - - - - - - - $ 309,035	$ 919 - - - - - $ 919 $ 919 - - - - - - - $ 919	$ 2,971 - - - - - $ 2,971 $ 2,971 - - - - - - - $ 2,971	$ 12,398 - - - 96,963 - $ 109,361 $ 109,361 - - - 35,000 - - - $ 144,361	$ 14,100 - - - - - $ 14,100 $ 14,100 - - - - ( 7,643 ) - - $ 6,457		$ 971,071 350,004 - 350,004 ( 96,963 ) ( 282,432 ) $ 941,680 $ 941,680 1,000,398 - 1,000,398 ( 35,000 ) 7,643 ( 314,710 ) - $ 1,600,011		$ - - ( 6,457 ) ( 6,457 ) - - ($ 6,457 ) ($ 6,457 ) - 224,213 224,213 - - - - $ 217,756		$ 9,379,979 350,004 ( 6,457 ) 343,547 - ( 282,432 ) $ 9,441,094 $ 9,441,094 1,000,398 224,213 1,224,611 - - ( 314,710 ) - $ 10,350,995		$ 259,852 9,742 - 9,742 - - $ 269,594 $ 269,594 47,547 - 47,547 - - - 279,800 $ 596,941	$ 9,639,831 359,746 ( 6,457 ) 353,289 - ( 282,432 ) $ 9,710,688 $ 9,710,688 1,047,945 224,213 1,272,158 - - ( 314,710 ) 279,800 $ 10,947,936

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

HANNSTOUCH SOLUTION INCORPORATED AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM OPERATING ACTIVITIES
Profit before tax
Adjustments
Adjustments to reconcile profit (loss)
Depreciation

Expected credit loss (gain) on doubtful accounts
Amortisation

Interest expense
Interest income

Dividend income

(Gain) loss on disposals of property, plant and
equipment

Gain on disposal of non-current assets held for sale

Loss (gain) on financial assets at fair value through
profit or loss

Gain on lease modification

Reversal of impairment loss recognised in profit or
loss, non-financial assets
Gain on disposal subsidiaries

Other income-gain on pension settlement

Other income-gain on litigation settlement
Changes in operating assets and liabilities
Changes in operating assets
Financial assets at fair value through profit or loss -
current
Accounts receivable
Accounts receivable - related parties
Other receivables
Other receivables - related parties
Inventory
Other current assets
Changes in operating liabilities
Notes payable
Accounts payable
Accounts payable - related parties
Other payables
Other payables - related parties
Other current liabilities
Other non-current liabilities
Cash inflow generated from operations
Interest received
Cash dividends received
Interest paid
Income taxes paid
Net cash flows from operating activities

Year ended December 31
Notes
2021
2020
$ 1,281,985 $ 462,620
6(24)
815,766
985,385
11 (
45 )
6(24)
9,886
8,029
70,540
97,247
6(21)
(
10,371 ) (
3,463 )
6(22)
(
20,888 )
-
6(23)
(
114 )
10,634
6(23)
(
192,690 )
-
6(2)(23)
30,300 (
2,195 )
6(9)(23)
(
3,509 ) (
10 )
- (
28,698 )
6(23)
- (
3,741 )
6(22)
- (
2,339 )
- (
39,600 )
(
52,004 )
4,673
(
76,268 )
131,925
16,710 (
16,443 )
23,969 (
30,611 )
(
1,074 )
55,507
(
5,723 ) (
22,574 )
14,335
9,484
1,486 (
1,159 )
23,330 (
25,632 )
(
2,486 )
2,468
(
17,216 )
7,314
1,128
678
(
9,634 )
9,935
-
30,749
1,897,469
1,640,138
8,627
3,407
20,888
-
(
63,378 ) (
87,577 )
(
143 )
-
1,863,463
1,555,968

(Continued)

HANNSTOUCH SOLUTION INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM INVESTING ACTIVITIES
Increase in financial assets at fair value through profit or
loss - non-current
Increase in financial assets at fair value through other
comprehensive income
Increase in current financial assets at amortised cost
Acquisition of property, plant and equipment

Proceeds from disposal of property, plant and equipment
Proceeds from disposal of non-current assets held for sale
Acquisition of intangible assets
(Increase) decrease in other non-current assets
Proceeds from disposal of subsidiaries (less cash)
Advance receipts for the sale of property, plant and
equipment

Decrease in other current financial assets
Net cash flows (used in) from investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from short-term debt
Repayment of short-term debt
Repayment of long-term debt
Proceeds from long-term debt
Proceeds from corporate bonds payable

Repayment of corporate bonds payable
Repayment of lease liabilities

Increase in non-controlling interests
Cash dividends paid

Net cash flows used in financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of year

Cash and cash equivalents at end of year

Year ended December 31
Notes
2021
2020
( $ 90,000 ) $ -
(
358,899 ) (
201,482 )
(
1,591,075 ) (
508,769 )
6(27)
(
447,688 ) (
365,810 )
147
524
1,660,264
-
(
960 ) (
1,200 )
(
1,710 )
61,892
-
86,414
7
-
1,108,000
14,433
22,361
(
815,488 )
201,930
40,000
-
(
40,000 ) (
30,000 )
(
1,873,333 )
-
336,630
600,000
6(14)
1,500,000
-
(
900,000 ) (
600,000 )
6(28)
(
21,737 ) (
58,671 )
279,800
-
6(19)
(
314,710 ) (
282,432 )
(
993,350 ) (
371,103 )
54,625
1,386,795
6(1)
1,789,028
402,233
6(1)
$ 1,843,653 $ 1,789,028

INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE

To the Board of Directors and Shareholders of HannsTouch Solution Incorporated

Opinion

We have audited the accompanying parent company only balance sheets of HannsTouch Solution Incorporated as at December 31, 2021 and 2020, and the related parent company only statements of comprehensive income, of changes in equity and of cash flows for the years then ended, and notes to the parent company only financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying parent company only financial statements present fairly, in all material respects, the financial position of HannsTouch Solution Incorporated as at December 31, 2021 and 2020, and its financial performance and its cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for opinion

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

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of HannsTouch Solution Incorporated’s 2021 parent company only financial statements. These matters were addressed in the context of our audit of the parent company only financial statements as a whole and, in forming our opinion thereon, we do not provide a separate opinion on these matters.

Key audit matters for HannsTouch Solution Incorporated’s 2021 parent company only financial statements are stated as follows:

Key Audit Matter –Appropriateness of cut-off of overseas warehouse operating revenue

Description

Refer to Note 4(32) for a description of accounting policy on revenue recognition in the financial statements.

The Company stores inventories in the warehouses under the custody of foreign third parties. Such inventories are checked and accepted by the custodians in order to meet the requirements of overseas sales customers. The custodians regularly send inventory reports to the Company to verify the quantity, and the Company recognises operating revenue based on actual inventories used by the customers which are shown in the inventory report provided by the custodians.

As the process of revenue recognition arising from the Company’s foreign warehouse involves numerous manual procedures, we considered the appropriateness of cut-off of overseas warehouse operating revenue as a key audit matter.

How our audit addressed the matter:

We performed the following audit procedures on the above key audit matter:

Obtained an understanding and evaluated the Company’s procedures on overseas warehouse operating revenue, and selected samples to check the accuracy of operating revenue recognition.
Performed cut-off procedures on sales revenue from distribution warehouse recognised during a specific period before and after the period-end, including verifying delivery schedule of distribution warehouse and ensuring the movements of inventories contained in the statements and cost of goods sold had been recognised in the appropriate period; and
Performed confirmation for significant warehouses.

Key audit matter- Impairment assessment on investment property

(I) Description

Refer to Notes 4(20), 5(2) and 6(12) for accounting policy applied on impairment of investment property, accounting estimates and assumptions applied on the impairment assessment of tangible assets and details of impairment.

The Company has appointed appraisers to appraise the investment property in Taipei and to value the recoverable amount as the basis for assessing the impairment of investment property.

The recoverable amount is calculated through income approach and comparison method. The

determination of the recoverable amount is subject to management judgement and uncertainty, which could have a significant impact in assessing whether there is any impairment loss on investment property. Thus, we considered the impairment assessment of investment property as a key audit matter.

(II) How our audit addressed the matter:

We understood the basis and process of management’s assessment and performed the following audit procedures in respect of the above key audit matter:

Assessed the expected future income used in the experts’ appraisal report and compared with local market price and forecast documents for the industry.
Assessed the discount rate used in the experts’ appraisal report and inspected the assumptions of cost of capital with return on similar assets in the market.
Examined the parameters of valuation model in the experts’ appraisal report and setting of formulas.

Responsibilities of management and those charged with governance for the parent company only financial statements

Management is responsible for the preparation and fair presentation of the parent company only financial statements in accordance with the 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 parent company only financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the parent company only financial statements, management is responsible for assessing HannsTouch Solution Incorporated’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 HannsTouch Solution Incorporated 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 HannsTouch Solution Incorporated’s financial reporting process.

Auditors’ responsibilities for the audit of the parent company only financial statements

Our objectives are to obtain reasonable assurance about whether the parent company only 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 generally accepted auditing standards 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 parent company only financial statements.

Identify and assess the risks of material misstatement of the parent company only 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 HannsTouch Solution Incorporated’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 HannsTouch Solution Incorporated’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 parent company only financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the parent company only financial statements, including the disclosures, and whether the parent company only financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within HannsTouch Solution Incorporated to express an opinion on the parent company only financial statements. We are responsible for the direction, supervision and performance of the audit. We remain solely responsible for our audit opinion.

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

Chen, Ching Chang Liao, Andy

For and on behalf of PricewaterhouseCoopers, Taiwan February 22, 2022

Chen, Ching Chang

[Lin, Chun-Yao ]

For and on Behalf of PricewaterhouseCoopers, Taiwan

April 11, 2022

------------------------------------------------------------------------------------------------------------------------------------------------The accompanying parent company only financial statements are not intended to present the financial position and results of operations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions other than the Republic of China. The standards, procedures and practices in the Republic of China governing the audit of such financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic of China. Accordingly, the accompanying parent company only financial statements and independent auditors’ report are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in the Republic of China, and their applications in practice.

HANNSTOUCH SOLUTION INCORPORATED PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

Assets	Notes 6(1) 6(2) 6(4) 6(5) 7 7 6(6) 6(13) 6(7) and 8 6(2) 6(3) 6(8) 6(9), 7 and 8 6(10) 6(12) and 8 6(26)	December 31, 2021 AMOUNT $ 1,546,639 64,887 1,571,000 320,278 52,848 2,173 2,285 203,248 - 44,957 29,503 3,837,818 96,109 778,137 732,018 4,383,563 285,527 5,762,387 14,229 94,443 569 12,146,982 $ 15,984,800	December 31, 2020
			AMOUNT
Current assets 1100 Cash and cash equivalents 1110 Financial assets at fair value through profit or loss - current 1136 Current financial assets at amortised cost 1170 Accounts receivable, net 1180 Accounts receivable - related parties 1200 Other receivables 1210 Other receivables - related parties 130X Inventory 1460 Non-current assets or disposal groups classified as held for sale, net 1476 Other current financial assets 1479 Other current assets 11XX Total current assets Non-current assets 1510 Non-current financial assets at fair value through profit or loss 1517 Non-current financial assets at fair value through other comprehensive income 1550 Investments accounted for under equity method 1600 Property, plant and equipment 1755 Right-of-use assets 1760 Investment property - net 1780 Intangible assets 1840 Deferred income tax assets 1900 Other non-current assets 15XX Total non-current assets 1XXX Total assets			$ 1,618,587 46,481 600,000 245,518 73,620 21,652 485 198,100 2,575,574 59,390 38,557
			5,477,964
			- 193,411 349,134 4,615,811 335,723 5,810,132 17,128 324,327 598
			11,646,264
			$ 17,124,228

(Continued)

HANNSTOUCH SOLUTION INCORPORATED PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

Liabilities and Equity	Notes 6(2) 7 6(14) 7 6(16) 7 6(15) and 7 6(16) and 8 6(26) 6(18) 6(19) 6(20) 9 11	December 31, 2021 December 31, 2020 AMOUNT AMOUNT $ 8 $ 1 1,703 217 158,052 134,500 - 2,486 378,461 342,864 1,150 2,615 24,844 25,895 14,034 30,794 251,015 233,333 38,072 1,123,886 867,339 1,896,591 1,500,000 900,000 2,972,282 4,526,667 55 779 277,801 311,971 16,328 47,126 4,766,466 5,786,543 5,633,805 7,683,134 8,069,485 8,069,485 312,925 312,925 144,361 109,361 6,457 14,100 1,600,011 941,680 217,756 ( 6,457 ) 10,350,995 9,441,094 $ 15,984,800 $ 17,124,228
Current liabilities 2120 Financial liabilities at fair value through profit or loss - current 2150 Notes payable 2170 Accounts payable 2180 Accounts payable - related parties 2200 Other payables 2220 Other payables - related parties 2230 Current income tax liabilities 2280 Current lease liabilities 2320 Long-term liabilities, current portion 2399 Other current liabilities 21XX Total current liabilities Non-current liabilities 2530 Corporate bonds payable 2540 Long-term borrowings 2570 Deferred income tax liabilities 2580 Non-current lease liabilities 2670 Other non-current liabilities 25XX Total non-current liabilities 2XXX Total liabilities Equity Share capital 3110 Common stock Capital surplus 3200 Capital surplus Retained earnings 3310 Legal reserve 3320 Special reserve 3350 Unappropriated retained earnings 3400 Other equity interest 3XXX Total equity Significant contingent liabilities and unrecognised contract commitments Significant events after the balance sheet date 3X2X Total liabilities and equity

The accompanying notes are an integral part of these parent company only financial statements.

HANNSTOUCH SOLUTION INCORPORATED

PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME YEARS ENDED DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars, except for earnings per share amounts)

Items	Year ended December 31 2021 2020 Notes AMOUNT AMOUNT 6(21) and 7 $ 3,556,043 $ 2,929,250 6(6)(25) and 7 ( 2,386,433) ( 2,294,305) 1,169,610 634,945 6(25) and 7 ( 32,839) ( 27,264) ( 170,371) ( 144,547) ( 33,939) ( 40,678) 12(2) ( 11) 48 ( 237,160) ( 212,441) 932,450 422,504 6(22) 9,208 2,630 6(23) 155,638 139,272 6(24) and 7 165,219 ( 18,002) 7 ( 70,507) ( 93,575) 6(8) 34,884 5,205 294,442 35,530 1,226,892 458,034 6(26) ( 226,494) ( 108,030) $ 1,000,398 $ 350,004 6(3) $ 225,827 ($ 8,071) 6(26) ( 1,614) 1,614 $ 224,213 ($ 6,457) $ 1,224,611 $ 343,547 6(27) $ 1.24 $ 0.43 $ 1.23 $ 0.43
4000 Sales revenue 5000 Operating costs 5950 Net operating margin Operating expenses 6100 Selling expenses 6200 General and administrative expenses 6300 Research and development expenses 6450 (Impairment loss) reversal of impairment loss determined in accordance with IFRS 9 6000 Total operating expenses 6900 Operating profit Non-operating income and expenses 7100 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, net 7000 Total non-operating income and expenses 7900 Profit before income tax 7950 Income tax expense 8200 Profit for the year Other comprehensive income Components of other comprehensive income that will not be reclassified to profit or loss 8316 Unrealised gains (losses) from investments in equity instruments measured at fair value through other comprehensive income 8349 Income tax related to components of other comprehensive income that will not be reclassified to profit or loss 8300 Other comprehensive income (loss) for the year 8500 Total comprehensive income for the year Earnings per share (in dollars) 9750 Basic earnings per share 9850 Diluted earnings per share

Items

Year ended December 31
2021
2020
Notes
AMOUNT
AMOUNT
6(21) and 7
$ 3,556,043
$ 2,929,250
6(6)(25) and 7
(
2,386,433) (
2,294,305)
1,169,610
634,945
6(25) and 7
(
32,839) (
27,264)
(
170,371) (
144,547)
(
33,939) (
40,678)
12(2)
(
11)
48
(
237,160) (
212,441)
932,450
422,504
6(22)
9,208
2,630
6(23)
155,638
139,272
6(24) and 7
165,219 (
18,002)
7
(
70,507) (
93,575)
6(8)
34,884
5,205
294,442
35,530
1,226,892
458,034
6(26)
(
226,494) (
108,030)
$ 1,000,398
$ 350,004
6(3)
$ 225,827 ($ 8,071)
6(26)
(
1,614)
1,614
$ 224,213 ($ 6,457)
$ 1,224,611
$ 343,547
6(27)
$ 1.24
$ 0.43
$ 1.23
$ 0.43

4000
Sales revenue
5000
Operating costs
5950
Net operating margin
Operating expenses
6100
Selling expenses
6200
General and administrative
expenses
6300
Research and development
expenses
6450
(Impairment loss) reversal of
impairment loss determined in
accordance with IFRS 9
6000
Total operating expenses
6900
Operating profit
Non-operating income and
expenses
7100
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, net
7000
Total non-operating income
and expenses
7900
Profit before income tax
7950
Income tax expense
8200
Profit for the year
Other comprehensive income
Components of other
comprehensive income that will
not be reclassified to profit or
loss
8316
Unrealised gains (losses) from
investments in equity
instruments measured at fair
value through other
comprehensive income
8349
Income tax related to
components of other
comprehensive income that will
not be reclassified to profit or
loss
8300
Other comprehensive income
(loss) for the year
8500
Total comprehensive income for
the year
Earnings per share (in dollars)
9750
Basic earnings per share
9850
Diluted earnings per share

The accompanying notes are an integral part of these parent company only financial statements.

HANNSTOUCH SOLUTION INCORPORATED

PARENT COMPANY ONLY STATEMENTS OF CHANGES IN EQUITY YEARS ENDED DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

Year ended December 31, 2020 Balance at January 1, 2020 Profit for the year Other comprehensive loss Total comprehensive income (loss) Appropriations of 2019 earnings: Legal reserve Cash dividends Balance at December 31, 2020 Year ended December 31, 2021 Balance at January 1, 2021 Profit for the year Other comprehensive income Total comprehensive income Appropriations of 2020 earnings: Legal reserve Special reserve Cash dividends Balance at December 31, 2021	Notes		Share capital - commonstock				Capital Reserves						RetainedEarnings				Unrealised gains (losses) from financial assets measured at fair value through other comprehensive income		Totalequity
				Total capital surplus, additional paid-incapital			Difference between the price for acquisition or disposal of subsidiaries and carrying amount		Capital surplus, others		Legal reserve		Special reserve		Unappropriated retained earnings
	6(20) 6(20)		$ 8,069,485 - - - - - $ 8,069,485 $ 8,069,485 - - - - - - $ 8,069,485		$ 309,035 - - - - - $ 309,035 $ 309,035 - - - - - - $ 309,035		$ 919 - - - - - $ 919 $ 919 - - - - - - $ 919		$ 2,971 - - - - - $ 2,971 $ 2,971 - - - - - - $ 2,971		$ 12,398 - - - 96,963 - $ 109,361 $ 109,361 - - - 35,000 - - $ 144,361	$ 14,100 - - - - - $ 14,100 $ 14,100 - - - - ( 7,643 ) - $ 6,457		$ 971,071 350,004 - 350,004 ( 96,963 ) ( 282,432 ) $ 941,680 $ 941,680 1,000,398 - 1,000,398 ( 35,000 ) 7,643 ( 314,710 ) $ 1,600,011		$ - - ( 6,457 ) ( 6,457 ) - - ($ 6,457 ) ($ 6,457 ) - 224,213 224,213 - - - $ 217,756		$ 9,379,979 350,004 ( 6,457 ) 343,547 - ( 282,432 ) $ 9,441,094 $ 9,441,094 1,000,398 224,213 1,224,611 - - ( 314,710 ) $ 10,350,995

The accompanying notes are an integral part of these parent company only financial statements.

HANNSTOUCH SOLUTION INCORPORATED

PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM OPERATING ACTIVITIES
Profit before tax
Adjustments
Adjustments to reconcile profit (loss)
Depreciation

Expected credit loss (gain) on doubtful accounts

Amortisation

Interest expense
Interest income

Dividend income

Loss (gain) on financial assets at fair value through
profit or loss

Share of profit or loss of associates and joint ventures
accounted for under equity method

(Gain) loss on disposals of property, plant and
equipment

Gain on disposal of non-current assets held for sale

Reversal of impairment loss recognised in profit or
loss, non-financial assets

Other income-gain on pension settlement

Other income-gain on litigation settlement

Gain from lease modification

Changes in operating assets and liabilities
Changes in operating assets
Financial assets at fair value through profit or loss
Accounts receivable
Accounts receivable - related parties
Other receivables
Other receivables - related parties
Inventory
Other current assets
Changes in operating liabilities
Notes payable
Accounts payable
Accounts payable - related parties
Other payables
Other payables - related parties
Other current liabilities
Other non-current liabilities
Cash inflow generated from operations
Interest received
Cash dividends received
Interest paid
Net cash flows from operating activities

Year ended December 31
Notes
2021
2020
$ 1,226,892 $ 458,034
6(25)
778,527
931,517
12(2)
11 (
48 )
6(25)
7,440
6,735
70,507
93,575
6(22)
(
9,208 ) (
2,630 )
6(23)
(
20,888 )
-
6(2)(24)
27,495 (
2,996 )
6(8)
(
34,884 ) (
5,205 )
6(24)
(
126 )
10,614
6(24)
(
192,690 )
-
6(24)
- (
28,698 )
6(23)
- (
2,339 )
6(23)
- (
39,600 )
6(24)
(
3,509 )
-
(
52,004 )
4,672
(
74,771 )
136,207
20,772 (
43,923 )
20,847 (
19,756 )
(
1,800 ) (
385 )
(
5,148 ) (
21,945 )
10,224 (
3,105 )
1,486 (
1,124 )
23,552 (
27,227 )
(
2,486 )
2,468
(
23,616 )
8,606
432
125
(
8,610 )
4,944
-
30,798
1,758,445
1,489,314
7,842
2,362
20,888
-
(
63,369 ) (
87,025 )
1,723,806
1,404,651

(Continued)

HANNSTOUCH SOLUTION INCORPORATED

PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2021 AND 2020

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM INVESTING ACTIVITIES
Increase in current financial assets at amortised cost
Acquisition of investments accounted for under equity
method

Acquisition of property, plant and equipment

Proceeds from disposal of property, plant and
equipment
Acquisition of investment property

Decrease in other non-current assets
Decrease in other current financial assets
Acquisition of financial assets at fair value through
other comprehensive income
Acquisition of financial assets at fair value through
profit or loss
Proceeds from disposal of non-current assets held for
sale
Dividends received

Advance receipts for the disposal of property, plant and
equipment

Net cash flows (used in) from investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Repayment of corporate bonds payable
Proceeds from long-term debt
Repayment of long-term debt
Issuance of corporate bonds payable

Repayment of lease liabilities

Cash dividends paid

Net cash flows used in financing activities
Net (decrease) increase in cash and cash equivalents
Cash and cash equivalents at beginning of year

Cash and cash equivalents at end of year

Year ended December 31
Notes
2021
2020
( $ 971,000 ) ( $ 599,211 )
6(8)
(
348,000 )
-
6(28)
(
388,749 ) (
73,470 )
134
524
6(28)
(
40,817 ) (
110,107 )
29
64,067
14,433
22,361
(
358,899 ) (
201,482 )
(
90,000 )
-
1,660,264
-
6(8)
-
3,264
7
-
1,108,000
(
522,605 )
213,946
(
900,000 ) (
600,000 )
336,630
600,000
(
1,873,333 )
-
6(15)
1,500,000
-
6(29)
(
21,736 ) (
37,968 )
6(20)
(
314,710 ) (
282,432 )
(
1,273,149 ) (
320,400 )
(
71,948 )
1,298,197
6(1)
1,618,587
320,390
6(1)
$ 1,546,639 $ 1,618,587

The accompanying notes are an integral part of these parent company only financial statements.

[Attachment 2]

HannsTouch Solution Incorporated

Audit Committee’s Review Report

We have reviewed the Company's 2021 business report, financial statements, and earnings appropriation proposal prepared by the board of directors. The financial statements have been audited by independent auditors, Ching-Chang Chen and Fu-Ming Liao of PriceWaterhouseCoopers Taiwan, to which the auditors have issued an independent auditor's report. The Audit Committee found no misstatement in the above Business Report, Financial Statements or Earnings Appropriation Proposal and hereby issues its report as presented above in accordance with the Securities and Exchange Act and the Company Act.

For

2022 annual general meeting

Audit Committee convener:

==> picture [158 x 62] intentionally omitted <==

February 22, 2022

[Attachment 3]

2021 Remuneration of Individual Directors of HannsTouch Solution Inc.

												December 31,2021;unit: NTD thousands	December 31,2021;unit: NTD thousands	December 31,2021;unit: NTD thousands	December 31,2021;unit: NTD thousands	December 31,2021;unit: NTD thousands	December 31,2021;unit: NTD thousands	December 31,2021;unit: NTD thousands	December 31,2021;unit: NTD thousands	December 31,2021;unit: NTD thousands	December 31,2021;unit: NTD thousands	December 31,2021;unit: NTD thousands
Title	Name (Note 1)	Directors' compensation								Sum of A, B, C and D as a percentage of net income (%)		Compensation received as employee								Sum of A, B, C, D, E, F, and G as a percentage of net income (%)		Compensation from the parent company or business investments other than subsidiaries
		Benefits (A)		Pension (B)		Director remuneration (C) (proposed)		Fees for services rendered (D)				Salaries, bonuses, special allowances etc. (E)		Severance payment and pension (F)		Employee compensation (G) (Proposed amount)
		The Company	All companies included in the financial statements	The Company	All companies included in the financial statements	The Company	All companies included in the financial statements	The Company	All companies included in the financial statements	The Company	All companies included in the financial statements	The Company	All companies included in the financial statements	The Company --	All companies included in the financial statements	The Company		All companies included in the financial statements		The Company	All companies included in the financial statements
																Amount paid in cash	Amount paid in shares	Amount paid in cash	Amount paid in shares
Chairman	WeiHsin, Ma	241	241	-	-	2,800	2,800	80	80	0.31		11,117	11,117	-	-	180		180	-	1.44	1.44	23,308
Director	Hua Li Investment	241	241	-	-	2,800	2,800	-	-	0.30		-	-	-	-	-	-	-	-	0.30	0.30	-
	Representative: YuChi, Chiao	-	-	-	-			70	70	0.01		-	-	-	-	-	-	-	-	0.01	0.01	81,773
Director	TsuKang, Yu	241	241	-	-	2,800	2,800	80	80	0.31		-	-	-	-	-	-	-	-	0.31	0.31	-
Director	Sean Tai (Discharged)	137	137	-	-			40	40	0.02		-	-	-	-	-	-	-	-	0.02	0.02	-
Director	ChihChung, Chou	104	104			2,800	2,800	40	40	0.29										0.29	0.29	-
Independent Director	TienShang, Chang	361	361	-	-	2,800	2,800	70	70	0.32		-	-	-	-	-	-	-	-	0.32	0.32	-
Independent Director	Daniel Shih (Discharged)	205	205	-	-			40	40	0.02		-	-	-	-	-	-	-	-	0.02	0.02	-
Independent Director	Tommy S. Chao (Discharged)	205	205	-	-			40	40	0.02		-	-	-	-	-	-	-	-	0.02	0.02	-
Independent Director	TingWong, Cheng	156	156			2,800	2,800	40	40	0.30										0.30	0.30	-
Independent Director	JinFu, Chang	156	156			2,800	2,800	40	40	0.30										0.30	0.30	-
Total		2,047	2,047	-	-	19,600	19,600	540	540	2.22	2.22	11,117	11,117	-	-	180	-	180	-	3.346	3.346	105,081
1. Please explain the policy, system, standards and structure by which independent director compensation is paid, and the association between the amount paid and independent directors' responsibilities, risks, and time committed: The Company has developed its Director (including Independent Director) compensation policy in accordance with the Company Act and Articles of Incorporation. A compensation package is proposed by the Remuneration Committee after taking into consideration the Company's operating strategies, profitability, future prospects, the industry environment, and performance of individual Directors, and executed with the approval of the Board of Directors. 2. Compensation received by the director for providing services (e.g. assuming consultant positions of non-employee nature in the parent company/any company included in the financial statements/investment companies) in the last year, except those disclosed in the above table: Nil. 3. The remuneration information disclosed in the table differs from the information produced for taxation purposes. Thus, the table serves disclosure purposes, and not taxation use. Note 1: List of seven newly elected Directors (the Ninth Board of Directors) is as follows: WeiHsin Ma, YuChi Chiao (representative of Hua Li Investment), TsuKang Yu, ChihChung Chou, TienShang Chang, TingWong Cheng and ChinFu Chang.

[Attachment 4]

HannsTouch Solution Incorporated

Private Placement of Unsecured Ordinary Corporate Bonds

Item	2017 first domestic private placement of unsecured ordinary corporate bonds Issue date: November 28,2017	2017 first domestic private placement of unsecured ordinary corporate bonds Issue date: November 28,2017	2017 first domestic private placement of unsecured ordinary corporate bonds Issue date: November 28,2017	2017 first domestic private placement of unsecured ordinary corporate bonds Issue date: November 28,2017	2017 first domestic private placement of unsecured ordinary corporate bonds Issue date: November 28,2017
Type ofprivately placed securities	Unsecured ordinary corporate bonds
Date of Board meeting and amount approved	Date approved by the Board: October 27, 2017 NT$1,800,000,000; distinguished between Tranche A, Tranche B, and Tranche C by coupon rate. Tranche A: Issued for a total of Three Hundred Million New Taiwan Dollars Tranche B: Issued for a total of Six Hundred Million New Taiwan Dollars Tranche C:Issuedfora totalofNineHundredMillionNewTaiwan Dollars
Pricing basis andrationality	Not applicable
Selectionofspecific subscribers	Proceeded as prescribedin Article43-6 ofthe Securities andExchangeAct
Reasonsforprivate placement	To ensure the timeliness andfeasibility ofthe Company'sfund-raising plan
Payment completiondate	November 28,2017
Subscriber	Place of private placement	Eligibility	Subscription amount (NTDthousand)	Relationship with the Company	Involvement in the Company's management
	HannStar Display Corporation	Securities and Exchange Act, Article 43-6, Paragraph 1, Sub- paragraph3	1,800,000	Related party	Major shareholder with 10% or higher ownership interest
Actual subscription (or conversion) price	Not applicable
Difference between the actual subscription (or conversion) price and thereference price	Not applicable
Impact of private placement on shareholders' equity	Not applicable
Implementation status of fund utilization plan	The plan has been fully executed to date.
Benefits of the private equity placement	Improving financial structure and expanding working capital in the medium term.
Outstanding principal	Tranches A, B and C were redeemed and retired prior to maturity in October 2019, August 2020 and April 2021 respectively).

HannsTouch Solution Incorporated

Issuance of Unsecured Ordinary Corporate Bonds

Name of bonds	2021 tranche A, B and C HannsTouch first secured ordinary corporate bonds	2021 HannsTouch second secured ordinary corporate bonds
Rationale of offering	Boost operational capital and repay bank loans.	Boost operational capital and repay bank loans.
Approval document no.	Taipei Exchange per Taipei Exchange-Bond (TEB) Document No. 11000062631 dated June 24, 2021 approved application. TEB Document No. 11000066332 dated June 30, 2021 approved OTC trading starting July 5, 2021.	Taipei Exchange per Taipei Exchange-Bond (TEB) Document No. 11000126981 dated November 17, 2021 approved application. TEB Document No. 11000134452 dated November 25, 2021 approved OTC trading starting November 26, 2021.
Abbreviation of bonds	P10 HannsTouch 1A P10 HannsTouch 1B P10 HannsTouch 1C	P10 HannsTouch 2
Listing of bonds	OTC	OTC
Total value of issuance	Tranche A: NT$300,000,000 Tranche B: NT$300,000,000 Tranche C: NT$300,000,000 Total: NT$900,000,000	NT$600,000,000
Duration of issuance	July 5, 2021 to July 5, 2026	November 26, 2021 to November 26, 2026
Coupon rate	Fixed rate at 0.51%	Annual fixed rate at 0.57%
Repayment of principal	Bullet payment at maturity	Bullet payment at maturity
Rationale of offering	Boost operational capital and repay bank loans.	Boost operational capital and repay bank loans.
Guarantor	Tranche A: Mega International Commercial Bank Co., Ltd. Tranche B: Hua Nan Bank Co., Ltd. Tranche C: Taishin International Bank	Shin Kong Bank Co., Ltd.
Trustee	Bank SinoPac	Taishin International Bank
Main underwriter	The Capital Securities Corp.	Masterlink Securities Co., Ltd.
Transfer agent	Share Administration Office, HannsTouch Solution Inc.	Share Administration Office, HannsTouch Solution Inc.
Trading target	Limited to professional investors subjecting to Taipei Exchange Rules Governing Management of Foreign Currency Denominated International Bonds	Limited to professional investors subjecting to Taipei Exchange Rules Governing Management of Foreign Currency Denominated International Bonds

[Attachment 5]

HannsTouch Solution Incorporated

Ethical Corporate Management Best Practice Principles

Article 1 Purpose and Scope Based on management principles of integrity, transparency and accountability, HannsTouch Solution Inc. (hereafter, the Company) shall establish a management policy that takes root in good faith, and foster a good corporate governance and risk control mechanism, so as to create a business environment of sustainable development. As such, by referring to the Corporate Governance Best-Practice Principles for TWSE/TPEX Listed Companies, the Company establishes the Ethical Corporate Management Best Practice Principles. The scope of application of these Principles extends to subsidiaries over which the Company has de facto control, the direct or indirect shareholding of more than 50%. Article 2 Prohibition of Unethical Conduct When engaging in commercial activities, Directors, Managers, employees, and mandataries of the Company or persons having substantial control over the Company (hereafter, "the Company’s personnel") shall not directly or indirectly offer, promise to offer, request or accept any improper benefits, nor commit unethical acts including breach of ethics, illegal acts, or breach of fiduciary duty (hereafter "unethical conduct") for purposes of acquiring or maintaining benefits. Parties referred to in the preceding paragraph include civil servants, political candidates, political parties or members of political parties, state-run or private-owned businesses or institutions, and their directors, managers, employees or substantial controllers or other stakeholders. Article 3 Types of Benefits "Benefits" in these Principles means any valuable things, including money, endowments, commissions, positions, services, preferential treatment or rebates of any type or in any name. Benefits received or occasionally given in accordance with accepted social customs and that do not adversely affect specific rights and obligations shall be excluded. Article 4 Statutory Compliance The Company shall comply with the Company Act, Securities and Exchange Act, Business Entity Accounting Act, Political Donations Act, Anti-Corruption Act, Government Procurement Act, Act on Recusal of Public Servants Due to Conflicts of Interest, TWSE/GTSM listing rules, or other law or regulations regarding commercial activities, as the underlying basic premise to facilitate ethical corporate management. Article 5 Policy Based on management principles of integrity, transparency and accountability, the Company shall establish a management policy that takes root in good faith, and foster a good corporate governance and risk control mechanism so as to create a business environment of sustainable development. Article 6 Preventive Measures The Company shall, in its own ethical management policy, definitively and thoroughly prescribe the specific ethical management practices and the measures to forestall unethical conduct ("preventive measures"),

including operational procedures, guidelines, and training.

When establishing the preventive measures, the Company shall comply with the relevant law and regulations of the territory where the Company and its business group are operating in. In the course of developing the preventive measures, the Company is advised to negotiate with employees, labor unions members, important trading counterparties, or other stakeholders. Article 7 Scope of Preventive Measures The Company shall establish the evaluation mechanism on the risk of unethical conduct, regularly analyzing and assessing business activities within their business scope that have a possibly higher risk of unethical conduct. The Company shall then formulate the preventive measures accordingly and regularly review their appropriateness and effectiveness.

The Company shall refer to widely adopted standards or guidelines, both domestic or abroad, in formulating the preventive measures. The measures shall at least cover the following behavior:

VII. Offering and accepting bribes.

VIII. Making illegal political donations.

IX. Making improper charitable donations or sponsorship.

X. Offering or accepting unreasonable presents or hospitality, or other improper benefits.

XI. Misappropriating trade secrets and infringing trademark rights, patent rights, copyrights, and other intellectual property rights.

XII. Engaging in unfair competitive practices.

XIII. Causing direct or indirect damage to the rights or interests, health, or safety of consumers in the course of research and development, procurement, manufacturing, or provision or sale of products and services. Article 8 Commitment and Implementation The Company shall require its Directors and top management to produce a declaration of compliance with ethical management policy. Furthermore, the Company shall stipulate the compliance with ethical management policy as a condition for employment.

The Company shall indicate definitively the ethical management policy and the commitment of the Board of Directors and top management in implementing such policies in its internal policies, external documents and on the company website. Moreover, the policies shall be implemented in internal management and commercial activities.

Pertaining to the first and second items on ethical management policy, declaration, commitment and implementation, the Company shall prepare the documentation and keep proper records. Article 9 Ethical Management in Commercial Activities

The Company shall engage in commercial activities in a fair and transparent manner based on the principle of ethical management.

Prior to any commercial transactions, the Company shall take into consideration the legality of its agents, suppliers, clients, or other trading counterparties and whether any of them are involved in unethical conduct. The Company shall avoid any dealings with persons so involved.

When entering into contracts with their agents, suppliers, clients, or other trading counterparties, the

Company shall include in such contracts terms requiring compliance with ethical corporate management policy. In the event that the trading counterparties are involved in unethical conduct, the Company may at any time terminate or rescind the contracts. Article 10 Prohibition of Offering and Accepting Bribes When conducting business, the Company’s personnel may not directly or indirectly offer, promise to offer, request, or accept any improper benefits in whatever form to or from clients, agents, contractors, suppliers, public servants or other stakeholders. Article 11 Prohibition of Illegal Political Donations When directly or indirectly offering a donation to political parties or organizations or individuals participating in political activities, the Company’s personnel shall comply with the law and regulations, and the Company’s own relevant internal operational procedures, and shall not make such donations in exchange for commercial gains or trading advantages. Article 12 Prohibition of Improper Charitable Donations or Sponsorship. When making or offering donations and sponsorship, the Company’s personnel shall comply with the relevant law and regulations and internal operational procedures, and shall not surreptitiously engage in bribery. Article 13 Prohibition of Offering or Accepting Unreasonable Presents or Hospitality, or Other Improper Benefits The Company’s personnel shall not directly or indirectly offer or accept any unreasonable presents, hospitality or other improper benefits to establish business relationships or influence commercial transactions. Article 14 Prohibition of Infringement of Intellectual Property Rights The Company’s personnel shall observe the relevant law and regulations, internal operational procedures of the Company and contractual provisions pertaining to intellectual property. Without prior consent of the intellectual property rights holder, the Company’s personnel may not use, leak, dispose, damage intellectual property or otherwise infringe intellectual property rights. Article 15 Prohibition of Engagement in Unfair Competitive Practices The Company shall engage in business activities in accordance with the relevant competition law and regulations, and may not fix prices, make rigged bids, establish output restrictions or quotas, or share or divide markets by allocating customers, suppliers, territories, or lines of commerce. Article 16 Prevention of Products and Services from Damaging the Interest of Stakeholders In the course of research and development, procurement, manufacture, provision, or sale of products and services, the Company’s personnel shall observe the applicable law and regulations and international standards to ensure the information transparency and safety of its products and services. It shall also establish and publish a policy on the protection of the rights and interests of consumers or other stakeholders, and implement the policy in its operations, so as to prevent its products and services from directly or indirectly damaging the rights and interests, health, and safety of consumers or other stakeholders. Where there is sufficient evidence supporting the fact that the Company's products or services are likely to pose any hazard to the safety and health of consumers or other stakeholders, the Company shall, in principle, recall those products or suspend the services immediately. Article 17 Organization and Responsibility

The Company’s personnel shall exercise due care of good administrators to compel the Company in preventing unethical conduct, always reviewing the implementation results of preventive measures and consistently making adjustments so as to ensure implementation of its ethical management policies.

To achieve sound ethical management and promotion, the Board of Directors shall authorize the Chairperson to take charge and establish a unit under the Chairperson with sufficient and qualified personnel. The unit shall be responsible for formulating and supervising the implementation of ethical management policies and preventive measures. The dedicated unit shall be in charge of the following matters, and shall report to the Board of Directors on a regular basis (at least once a year):

Assist in incorporating ethics and moral values into the Company's business strategy, and establish the appropriate preventive measures pertaining to ethical management in accordance with the law and regulations.
Analyze and evaluate the risk of unethical conduct on a regular basis, and formulate preventive measures to forestall unethical management, as well as establish the standard operating procedures and conduct guidelines for various measures with respect to the Company's operations and business.
Plan the internal organization, structure, and allocation of responsibilities. Establish mutual supervision mechanisms and checks and balances for business activities with a higher risk for unethical conduct within the business scope.
Promote and coordinate awareness and educational activities with respect to ethics policy.
Develop a whistle-blowing system and ensure its effectiveness in implementation.
Assist the Board of Directors and management in reviewing and assessing whether the preventive measures taken for the purpose of implementing ethical management are operating effectively. Perform regular assessments and prepare reports on compliance with ethical management in operating procedures.

Article 18 Compliance Requirements in Conducting Business

The Company’s personnel shall comply with law and regulations and the preventive measures when conducting business.

Article 19 Avoidance of Conflict of Interest

The Company shall adopt policies for preventing conflicts of interest from identifying, monitor, and manage risks possibly resulting from unethical conduct, and shall also offer appropriate means for Directors, Managers, and other stakeholders attending or sitting in Board meetings to voluntarily describe any potential conflict of interests with the Company.

When a proposal at a given Board of Directors meeting concerns personal interest or the interest of the juristic person represented, any of the Directors, Managers, and other stakeholders attending or present at Board meetings of the Company shall describe the important aspects of the relationship of interest at the given Board meeting. If his or her participation is likely to prejudice the interest of the Company, the concerned person may not participate in the discussion of or voting on the proposal and shall recuse himself or herself from the discussion or the voting, and may not exercise voting rights as a proxy for another Director. The Directors shall practice self-discipline and must not support one another in improper dealings.

The Company's personnel shall not take advantage of their positions or influence in the Company to obtain

improper benefits for themselves, their spouses, parents, children or any other person. Article 20 Accounting and Internal Control The Company shall establish effective accounting systems and internal control systems for business activities with a potentially higher risk of an unethical conduct occurrence, not keep under-the-table or secret accounts, and conduct regular reviews, so as to ensure the effectiveness of the design and enforcement of these systems. Based on the results of risk assessment on unethical conduct, the internal audit unit of the Company shall formulate the relevant audit plan, which shall prescribe the subjects, scope, items and frequency of audit. The audit plan shall serve as the base for examining compliance with the foregoing systems. The internal audit unit may engage a certified public accountant to carry out the audit, and may engage professionals to assist if necessary. The top management and the dedicated unit for ethical management shall be notified of the aforementioned audit results. An audit report detailing the audit results shall be prepared and submitted to the Chairperson. Article 21 Operating Procedures and Behavior Guideline The Company shall establish operating procedures and behavior guidelines in accordance with Article 6 hereof to prescribe precautions for the Company’s personnel in conducting business activities. The procedures and guidelines shall at least contain the following matters: 1. Standards for determining whether improper benefits have been offered or accepted. 2. Procedures for offering legitimate political donations.

Procedures and the standard rates for offering charitable donations or sponsorship.
Rules for avoiding work-related conflicts of interests and procedures for declaration and handling.
Rules for keeping confidential trade secrets and sensitive business information obtained in the ordinary course of business.
Regulations and procedures for handling suppliers, clients and business transaction counterparties suspected of unethical conduct.
Procedures for handling violations of these Principles.
Disciplinary measures against offenders. Article 22 Training and Performance Appraisal System The Chairperson, General Manager, or senior management of the Company shall communicate the importance of corporate ethics to its Directors, employees, and mandataries on a regular basis. The Company shall periodically organize training and awareness programs for Directors, Managers, employees, mandataries, and substantial controllers, and invite the Companies' commercial transaction counterparties to also participate in these programs, so that they understand the Company’s resolve in implementing ethical management, the related policies, preventive measures and the consequences of violating unethical conduct. The Company shall apply the policies of ethical management when creating its employee performance appraisal system and human resource policies to establish a definitive and effective reward and disciplinary system.

Article 23 Whistle-Blowing System

The Company shall adopt a concrete whistle-blowing system and scrupulously operate the system. The whistle-blowing system shall include at least the following:

Establish and publicly announce an independent mailbox and hotline, or engage an independent external institution to provide the mailbox and hotline for company insiders and outsiders to make reports.
Appoint personnel or unit to handle the whistle-blowing system. Any report involving a Director or Senior Manager shall be forwarded to the Independent Directors or Supervisors. Categories of reported misconduct shall be delineated and standard operating procedures for the investigation of each category shall be adopted.
Establish the subsequent measures according to the severity of the misconduct after the investigation of the report is concluded. If necessary, a formal report to the competent authority shall be filed and the case should be transferred to judicial authority for a formal investigation.
Prepare and keep a record of the documentation of case acceptance, investigation processes, investigation results, and relevant documents.
Maintain confidentiality of the identity of whistle-blowers and the content of reported cases.
Protect whistle-blowers from inappropriate disciplinary actions due to reporting misconduct.

Article 24 Disciplinary and Appeal system

The Company shall adopt and publish a well-defined disciplinary and appeal system for handling violations of the ethical management rules, and shall make immediate disclosure on the Company's internal website in respect of the title and name of the violator, the date and details of the violation, and the actions taken in response.

Article 25 Information Disclosure

The Company shall analyze and assess the effectiveness of the promotion of ethical management policy. It shall also disclose the measures taken for implementing ethical corporate management, the status of implementation and the effectiveness of promotion on company website, annual reports, and prospectuses, and shall disclose its ethical corporate management best practice principles on the Market Observation Post System.

Article 26 Ethical Corporate Management Policies and Measures for Better Implementation

The Company shall at all times monitor the development of relevant local and international regulations concerning ethical corporate management. It also encourages its Directors, Managers, and employees to make suggestions. Based on these suggestions, the Company reviews and improves the ethical corporate management policies adopted and measures taken so as to enhance the implementation of ethical management.

Article 27 Implementation

The Ethical Corporate Management Best Practice Principles of the Company shall be implemented after being approved by the Board of Directors and reported at the General Shareholders’ Meeting. The same procedure shall be followed for the amendments to these Principles.

When the Ethical Corporate Management Best Practice Principles are submitted for discussion by the Board of Directors pursuant to the preceding paragraph, the opinion of each Independent Director shall be taken into full consideration. Any objection or reservation of each Independent Director regarding any matter shall

be recorded in the minutes of the Board meeting. An Independent Director who is unable to attend the Board meeting in person to express objection or reservations shall provide a written opinion before the Board meeting, unless there is some legitimate reason to do otherwise, and the opinion shall be specified in the minutes of the Board meeting.

HannsTouch Solution Incorporated

Procedures for Ethical Management and Guidelines for Conduct

		Procedures for Ethical Management and Guidelines for Conduct
Article	1	Purpose and Scope
		The Company engages in commercial activities following the principles of fairness, honesty, faithfulness,
		and transparency. In order to fully implement the policy of ethical management and actively prevent unethical
		conduct, based on HannsTouch Solution Incorporated Ethical Corporate Management Best Practice
		Principles (hereafter, "Ethical Corporate Management Best Practice Principles") and the relevant law and
		regulations of the places where the Company and enterprises within its business groups and organizations
		operate, the Company has established these Procedures and Guidelines to provide the Company’s personnel
		definitive directions for performing duties.
		The scope of application of these Procedures and Guidelines extends to subsidiaries over which the Company
		has de facto control, or direct or indirect shareholding of more than 50%.
Article	2	Applicable Subjects
		For the purposes of these Procedures and Guidelines, the term "the Company’s personnel" refers to any
		Director, managerial officer, employee, mandatary or person having substantial control, of the Company and
		enterprises within its business groups and organization.
		Any provision, promise, request, or acceptance of improper benefits by any of the Company’s personnel
		through a third party will be presumed to be an act by the Company’s personnel.
Article	3	Unethical Conduct
		For the purposes of these Procedures and Guidelines, "unethical conduct" means that any of the Company’s
		personnel, in the course of their duties, directly or indirectly provides, promises, requests or accepts improper
		benefits or commits a breach of ethics, unlawful act, or breach of fiduciary duty for purposes of acquiring or
		maintaining benefits.
		Parties referred to in the preceding paragraph include civil servants, political candidates, political parties or
		members of political parties, state-run or private-owned businesses or institutions, and their directors,
		managers, employees or substantial controllers or other stakeholders.
Article	4	Types of Benefits
		For the purposes of these Procedures and Guidelines, the term "benefits" means any money, endowments,
		gift, commission, position, service, preferential treatment, rebate, facilitating payment, entertainment, dining,
		or any other item of value in whatever form or name.
Article	5	Designated Unit and Scope of Responsibility
		In accordance with Ethical Corporate Management Best Practice Principles, Article 17, the Company shall
		establish the ethical corporate management team (hereafter, "the designated unit") under the Chairperson, and
		provide it with sufficient and qualified personnel to take charge of the amendment, implementation,
		interpretation, and advisory services with respect to these Procedures and Guidelines, the documentation and
		filing of reports, and the monitoring of implementation. The designated unit shall be in charge of the following
		matters and also submit regular reports (at least once a year) to the Board of Directors:

Assist in incorporating ethics and moral values into the Company's business strategy, and establish the

appropriate preventive measures pertaining to ethical management in accordance with the law and regulations.

Analyze and evaluate the risk of unethical conduct on a regular basis, and formulate preventive measures to forestall unethical management, as well as establish the standard operating procedures and conduct guidelines for various measures with respect to the Company's operations and business.
Plan the internal organization, structure, and allocation of responsibilities. Establish mutual supervision mechanisms and checks and balances for business activities with a higher risk for unethical conduct within the business scope.
Promote and coordinate awareness and educational activities with respect to ethics policy.
Develop a whistle-blowing system and ensure its effectiveness in implementation.
Assist the Board of Directors and management in reviewing and assessing whether the preventive measures taken for the purpose of implementing ethical management are operating effectively. Perform regular assessments and prepare reports on compliance with ethical management in operating procedures.
Prepare and keep proper documentation of the ethical management policy and declaration of compliance, letter of commitment for implementation, as well as implementation records and other relevant documents.

Article 6 Prohibition of Providing or Accepting Improper Benefits

Except under any of the circumstances set forth in the following, when any of the Company’s personnel is provided with or are promised, either directly or indirectly, any benefits as specified in Article 4 by a third party, the matter shall be handled in accordance with the Ethical Corporate Management Best Practice Principles and these Procedures and Guidelines before proceeding:

Conduct undertaken to meet business needs and in accordance with local courtesy, convention, or custom during domestic (or foreign) visits, reception of guests, promotion of business, and communication and coordination.
Conduct based on ordinary social convention, commercial purposes, promotion of relationship fostering or invitation extended to other parties to take part in ordinary social activities.
Invitations extended to guests or received to attend commercial activities or pay factory visits in relation to business needs, where the method of fee payment, number of participants, class of accommodations, and the time period for the event or visit have been specified in advance.
Attendance at folk festivals that are open to and invite the attendance of the general public.
Provision of rewards, emergency assistance, condolence payments, or honorariums from the management.
Provision or receipt of money, object of value or other benefits which are worth less than NT$3,000. However, within the same year, the provision to or receipt of money, object of value or other benefits from a single party shall be restricted to NT$12,000.
Object of value received due to celebration of engagement, wedding, housewarming, promotion, retirement, resignation or tendering, or condolence payment due to illness of one’s spouse or immediate family, or passing shall be restricted to NT$3,000.

Other conduct that complies with the rules of the Company.
Article 7 Procedures for Handling the Acceptance of Improper Benefits Except under any of the circumstances set forth in the preceding articles, when any of the Company’s personnel is provided with or are promised, either directly or indirectly, any benefits as specified in Article 4 by a third party, the matter shall be handled in accordance with the following procedures:
If there is no relation of official duty interest between the party providing or offering the benefit and the Company's personnel, the personnel shall report to his or her immediate supervisor within three days from the acceptance of the benefit, and the designated unit shall also be notified if necessary.
If a relation of official duty interest does exist between the party providing or offering the benefit and the Company's personnel, the personnel shall return or refuse the benefit, and shall report to his or her immediate supervisor and notify the designated unit. When the benefit cannot be returned, then within three days from the acceptance of the benefit, the personnel shall refer the matter to the designated unit for further action.

The aforementioned “relation of official duty interest” refers to any of the following:

When the two parties have commercial dealings, a relationship of direction and supervision, or subsidies (or rewards) for expenses.
When a contracting, trading, or other contractual relationship is being sought or in progress, or has been established.
Other circumstances in which a decision regarding the Company's business activity, or the execution or non-execution of business activity, will result in a beneficial or adverse impact.

Based on the nature and value of the benefit under paragraph 1, the designated unit of the Company shall make a proposal to return, accept on payment, give to the public, donate to charity, or handle in another appropriate manner. The proposal shall be implemented after being reported and approved by the Chairperson.

Article 8 Prohibition of Facilitating Payments and the Corresponding Handling Procedures The Company shall neither provide nor promise any facilitating payment.

If any of the Company’s personnel provides or promises a facilitating payment under threat or intimidation, he or she shall submit a report to the immediate supervisor stating the facts and shall notify the designated unit.

Upon receipt of the report under the preceding paragraph, the designated unit shall take immediate action and undertake a review of relevant matters in order to minimize the risk of recurrence. In event of alleged illegality, the designated unit shall also immediately report to the relevant judicial agency.

Article 9 Procedures for Handling Political Donations, Charitable Donations or Sponsorships The Company shall make political donations, charitable donations or sponsorships in accordance with the relevant provisions of “Rules and Procedures of Board of Directors Meeting” and “Guidelines on Hierarchical Responsibility”.

Article 10 Avoidance of Conflict of Interest

meetings of the Company, shall describe the important aspects of the relationship of interest at the given Board meeting. If his or her participation is likely to prejudice the interest of the Company, the concerned person may not participate in the discussion of or voting on the proposal and shall recuse himself or herself from the discussion or the voting, and may not exercise voting rights as a proxy for another Director. The Directors shall practice self-discipline and must not support one another in improper dealings.

If the spouse or other relatives within two degrees of consanguinity of Director, or affiliated companies the Director deemed to have control form a conflict of interest pertaining to the aforementioned items of the meetings, the Director is deemed to have formed a conflict of interest thereof.

If in the course of conducting company business, the Company’s personnel discovers that a potential conflict of interest exists involving him or herself or the juristic person that he or she represents, or that him or herself, or his or her spouse, parents, children, or a person with whom he or she has a relationship of interest is likely to obtain improper benefits, the personnel shall report the relevant matters to both his or her immediate supervisor and the designated unit. The immediate supervisor shall provide the personnel with proper instructions.

None of the Company’s personnel may use company resources on commercial activities other than those of the Company, nor may any personnel's job performance be affected by his or her involvement in the commercial activities other than those of the Company.

Article 11 Organization and Responsibility for Confidentiality Mechanism

The Company shall set up a special unit charged with formulating and implementing procedures for managing, preserving, and maintaining the confidentiality of the Company's trade secrets, trademarks, patents, copyrights and other intellectual properties. It shall also conduct periodical reviews on the results of implementation to ensure the sustained effectiveness of the confidentiality procedures.

All of the Company’s personnel shall closely observe the aforementioned operational regulations pertaining to intellectual properties, and may not disclose to any other party any trade secrets, trademarks, patents, copyrights, and other intellectual properties of the Company of which they have learned. Furthermore, they may not make inquiries or collect any trade secrets, trademarks, patents, copyrights and other intellectual properties of the Company unrelated to their individual duties.

Article 12 Prohibition of Engagement in Unfair Competitive Practices

The Company shall engage in business activities in accordance with the Fair Trade Act and the relevant competition law and regulations, and may not fix prices, make rigged bids, establish output restrictions or quotas, or share or divide markets by allocating customers, suppliers, territories, or lines of commerce. Article 13 Prevention of Products and Services from Damaging the Interest of Stakeholders

The Company shall gather and understand the relevant law and regulations and international standards governing its products and services in which it shall observe. It shall also gather and publish all guidelines to facilitate the Company’s personnel in the course of their research and development, procurement, manufacture, provision, or sale of products and services, so as to ensure the information transparency and safety of the products and services.

The Company shall adopt and publish on its website the policy on the protection of rights and interests of

consumers or other stakeholders to prevent its products and services from directly or indirectly damaging the rights and interests, health, and safety of consumers or other stakeholders.

Where there are media reports or sufficient facts to determine that the Company's products or services are likely to pose any hazard to the safety and health of consumers or other stakeholders, the Company shall recall those products or suspend the services as soon as possible. The Company shall authenticate the facts, perform a review and provide an improvement plan.

The designated unit of the Company shall submit a report to the Chairperson on the event mentioned in the preceding paragraph, actions taken, subsequent reviews and corrective measures undertaken.

Article 14 Prevention of Insider Trading and Observation of Non-Disclosure Agreement

All of the Company’s personnel shall adhere to the provisions of the Securities and Exchange Act, and may not take advantage of undisclosed information which they have learned for insider trading. They are also prohibited from divulging undisclosed information to any other party to prevent other parties from using such information for insider trading.

Any organization or person outside of the Company involved in any merger, demerger, acquisition and share transfer, major memorandum of understanding, strategic alliance, other business partnership plan, or the signing of a major contract with the Company shall be required to sign a non-disclosure agreement, in which they commit not to divulge any trade secret or other material information of the Company acquired thereof to any other party, and that they may not use such information without the prior consent of the Company.

Article 15 Compliance and Declaration of Ethical Management

The Company shall require its Directors and top management to produce a declaration of compliance with ethical management policy. Furthermore, the Company shall stipulate the compliance with ethical management policy as a condition for employment.

The Company shall disclose its policy of ethical management in its internal rules, annual reports, on the company's websites, and in other promotional materials, and shall make timely announcements of the policy in external events, in order to make its suppliers, customers, and other business-related institutions and personnel fully aware of its principles and rules with respect to ethical management. Article 16 Ethical Management Evaluation prior to Establishing Commercial Relationships

Before establishing a commercial relationship with another party, such as an agent, supplier, customer, or other counterparty in commercial undertakings, the Company shall evaluate the legality and ethical management policy of the party. The Company shall also ascertain whether the party has a record of unethical conduct, in order to ensure that the counterparty conducts business in a fair and transparent manner and shall not request, offer, or take bribes.

When the Company carries out the evaluation under the preceding paragraph, it may adopt appropriate audit procedures to review the counterparty with which it will have commercial undertakings with respect to the following matters so as to gain a comprehensive knowledge of the counterparty’s ethical management:

The enterprise's nationality, location of business operations, organizational structure, and management policy, and locations where its payments shall be made.
Whether the enterprise has adopted an ethical management policy, and the status of its implementation.

Whether an enterprise's business operations are located in a country with a high risk of corruption.
Whether the business operated by the enterprise is in an industry with a high risk of bribery.
The long-term business condition and degree of goodwill of the enterprise.
Consultation with the enterprise's business partners on their opinion of the enterprise.
Whether the enterprise has a record of unethical conduct such as bribery or making illegal political contributions.

Article 17 Statement of Ethical Management Policy to Counterparties in Commercial Dealings

When engaging in commercial activities, the Company’s personnel shall inform the trading counterparties regarding the Company's ethical management policy and related rules, and definitively refuse to provide, promise, request, or accept directly or indirectly any improper benefit in whatever form or name.

Article 18 Avoidance of Commercial Undertakings with Unethical Operators

The Company’s personnel shall avoid engaging in business transactions with agents, suppliers, customers, or other commercial counterparties involved in unethical conduct. When a counterparty or partner in cooperation is found to have engaged in unethical conduct, the personnel shall immediately cease dealing with the counterparty and blacklist it for any further business interaction so as to effectively implement the Company's ethical management policy.

Article 19 Stipulation of Ethical Management in Contracts

Before entering into a contract with another party, the Company shall gain a thorough knowledge of the status of the other party's ethical management, and shall include observance of the Company’s ethical management policy as part of the terms and conditions of the contract, stipulating at the least the following matters:

When a party to the contract becomes aware that any personnel has violated the terms and conditions pertaining to the prohibition of acceptance of commissions, rebates, or other improper benefits, the party shall immediately notify the other party of the violator's identity, the manner in which the provision, promise, request, or acceptance was made, and the monetary amount or other improper benefits that have been or are intended to be provided or received. The party shall also provide evidence and assist in the investigation launched by the other party. If there has been resultant damage to either party, the party may make a claim from the other party.
Where a party is discovered to be engaging in unethical conduct in its commercial activities, the other party may terminate or rescind the contract unconditionally at any time.
Stipulate specific and reasonable payment terms, including the location and method of payment and the requirement for compliance with related tax laws and regulations.

Article 20 Handling of Unethical Conduct of the Company’s Personnel

As an incentive to insiders and outsiders for reporting unethical conduct or misbehavior, the Company will grant a reward depending on the severity of the circumstance concerned. Insiders having made a false report or malicious accusation shall be subject to disciplinary action or have their employment terminated if the circumstance concerned is grievous.

The Company shall establish and publicly announce on its website and the intranet an internal independent e-mail ([email protected]) and hotline for reporting unethical conduct. Alternatively, it may

engage an external independent agency to provide the e-mail and hotline for the use of insiders and outsiders.

A whistle-blower shall at least furnish the following information:

The whistle-blower’s name and I.D. number, or an address, telephone number and e-mail address where the anonymous whistle-blower can be reached.
The name or other information sufficient to identify the party being informed.
Specific facts available for investigation.

The Company’s personnel handling whistle-blowing matters shall represent in writing they will maintain the confidentiality of the whistle-blowers’ identity and contents of the report. The Company shall also commit to protecting the whistle-blowers from improper treatment due to their whistle-blowing.

The designated unit of The Company shall observe the following procedures:

If a report is made against a common employee, the report shall be forwarded to the supervisor of the internal audit department. If a report is made against a Director or a senior executive, the report shall be forwarded to the Chairperson.
The designated unit of The Company and the department head or personnel receiving the report in the preceding subparagraph shall immediately verify the facts. Where necessary, they shall seek assistance from legal compliance or other related departments.
If a person being informed on is confirmed to have indeed violated the applicable law and regulations or the Company's ethical management policy and regulations, the Company shall immediately require the violator to cease the misconduct and shall make an appropriate disposition. When necessary, the Company will institute legal proceedings and seek damages to safeguard its reputation, rights and interests.
Documentation of case acceptance, investigation processes and investigation results shall be retained for five years and may be retained electronically. In the event of a suit in respect of the whistleblowing case before the retention period expires, the relevant information shall continue to be retained until the conclusion of the litigation.
With respect to confirmed information, the Company shall charge relevant units with the task of reviewing the internal control system and relevant procedures and proposing corrective measures to prevent recurrence.
The designated unit of the Company shall report the event referred to in the preceding paragraph, actions taken, and subsequent reviews and corrective measures taken to the Chairperson.

Article 21 Actions Upon Event of Unethical Conduct by Others Toward the Company

If any of the Company’s personnel discovers that another party has engaged in unethical conduct towards The Company, and such unethical conduct involves alleged illegality, the Company shall report the relevant facts to the judicial and prosecutorial authorities; where a public service agency or public official is involved, the Company shall notify the governmental anti-corruption agency.

Article 22 Internal Awareness, and Establishment of Reward, Penalties, Complaint and Disciplinary Measures The designated unit shall arrange for an internal awareness promotion event at least once a year, whereby the Chairperson, General Manager, or senior management of the Company convey the importance of corporate

ethics to the Directors, employees, and mandataries.

The Company shall apply the policies of ethical management to the employee performance appraisal system and human resource policies to establish a definitive and effective reward and disciplinary system. For personnel who commits a severe violation of ethical conduct, the Company shall dismiss the personnel from his or her position or terminate his or her employment in accordance with the relevant law and regulations or the human resource procedures of the Company.

The Company shall disclose on its intranet the name and job title of the violator, the date and details of the violation, and the corresponding actions taken.

Article 23 Implementation

These Procedures and Guidelines, and any amendments hereto, shall be implemented after the resolution is passed by the Board of Directors, and reported to the Shareholders’ Meeting.

When these Procedures and Guidelines are submitted for discussion by the Board of Directors pursuant to the preceding paragraph, the opinion of each Independent Director shall be taken into full consideration. Any objection or reservation of each Independent Director regarding any matter shall be recorded in the minutes of the Board meeting. An Independent Director that cannot attend the Board meeting in person to express objection or reservations shall provide a written opinion before the board meeting, unless there is some legitimate reason to do otherwise, and the opinion shall be specified in the minutes of the Board meeting.

[Attachment 6]

HannsTouch Solution Incorporated

Fund Utilization Plan, Progress and Expected Benefits for Cash Capital Increase

I. Fund utilization plan and capital needed
To develop strategic alliances and expand working capital, the Company requires approximately NT$800 million.
II. Source of capital

Within the issuance limit of 80 million shares, the Company proposes to carry out a cash capital increase by issuing common shares through private placement, public offering, or a combination of both. The Company expects to raise approximately NT$800 million in funds.

III. Fund utilization progress

		Unit: NTD thousands	Unit: NTD thousands
Expected time of completion	Total capital needed	Expected fund utilization progress
		2022	2023
		Fourth quarter	First quarter
2023Q1	800,000	400,000	400,000

IV. Expected benefits

Using the average long-term loan interest rate of 1.176%, the Company is expected to save an interest expense of approximately NT$9,408 thousand.

[Attachment 7]

HannsTouch Solution Incorporated

Comparison Table of Amendments to Articles of Incorporation

	After Amendments	After Amendments	Before Amendments	Before Amendments	Description
Article 13	There are two types of Shareholders’ Meetings for the Company, namely the regular meeting and extraordinary meeting. Regular meetings shall be convened by the Board of Directors within six (6) months after the close of each fiscal year. The shareholders shall be notified 30 days prior to the regular meeting. Extraordinary meetings shall be convened when necessary. The shareholders shall be notified 15 days prior to the extraordinary meeting. For Shareholders’Meeting, the Company may hold by means of a visual communication network or other methods as promulgated by the central competent authority.		Article 13 There are two types of Shareholders’ Meetings for the Company, namely the regular meeting and extraordinary meeting. Regular meetings shall be convened by the Board of Directors within six (6) months after the close of each fiscal year. The shareholders shall be notified 30 days prior to the regular meeting. Extraordinary meetings shall be convened when necessary. The shareholders shall be notified 15 days prior to the extraordinary meeting.		Pursuant to the Company Act, Article 172-2, the means of visual communication network is open for holding the General Shareholders’ Meeting.
Section 4 Directorsand Functional Committees			Section 4 Directors
Article 19-1		The Company shall establish Audit Committee. The Audit Committee or its members shall undertake the duties of Supervisors, as prescribed in the Company Act, Securities and Exchange Act and other regulations.The composition, meeting calling, duties and meeting procedures shall be formulated and complied in accordance with the relevant law and regulations. The Board of Directors of the	Article 19-1	Since~~the election of the seventh~~ ~~Board of Directors, pursuant to the~~ ~~Securities and Exchange Act,~~ ~~Article 14-4,~~the Company has established the Audit Committee. ~~The Audit Committee shall be~~ ~~organized by Independent~~ ~~Directors.~~The Audit Committee or its members shall undertake the Supervisor's duties, as stipulated in the Company Act, Securities and Exchange Act and other regulations. ~~The Company established the~~	Transitional matters in the course of establishing the Audit Committee were deleted.

	After Amendments	Before Amendments	Before Amendments	Description
	Company shall also establish the Remuneration Committee, in which its qualification and duty performance of committee members, the establishment of committee charter and other matters shall be in compliance with the relevant law and regulations, and the Articles of Incorporation. The Board of Directors may establish other types of functional committees and their committee charters shall be formulated by the Board.		~~Audit Committee after the~~ ~~Annual General Shareholders’~~ ~~Meeting in 2015. The position of~~ ~~Supervisor was discharged after~~ ~~the establishment of the Audit~~ ~~Committee. The provisions of~~ ~~these Articles pertaining to the~~ ~~Supervisor shall be invalid.~~
Article 30 Earnings concluded in a year are first subject to taxation and reimbursement of previous losses, followed by a 10% provision for legal reserve. However, no further provision of legal reserve is required if the Company has accumulated legal reserve to an amount equal to the paid-up capital.Moreover, provision or reversal for special reserve shall be made in accordance with the regulations.Any earnings remaining shall be added to undistributed earnings carried from previous years and distributed as shareholder dividends or retained at the Board of Directors' proposal, subject to resolution in a Shareholders’ Meeting. Where the Company makes provision for special reserve, for provisions of “net accumulated other equity interest for previous periods”and“net increase in fair value of investment properties”		Article 30 Earnings concluded in a year are first subject to taxation and reimbursement of previous accumulated losses, followed by a 10% provision for legal reserves. However, no further provision of legal reserve is required if the Company has accumulated legal reserves to an amount equal to the paid-up capital. Any earnings remaining shall be added to undistributed earnings carried from previous years and distributed as shareholder dividends or retained at the Board of Directors' proposal, subject to resolution in a Shareholders’ Meeting. The Company may distribute all or part of its dividends, profits, capital reserves or legal reserves in cash, provided that such decision is resolved in a Board meeting with at least two-thirds of directors present, supported by more than half of the		In accordance with the Securities and Exchange Act, Article 41 (the regulation prescribes provision for special reserve) Article mandating provision or reversal of special reserve and the corresponding measures.

	After Amendments	Before Amendments	Description
	not met, prior to earnings distribution, the Company shall transfer an amount equivalent to special reserve from undistributed earnings of previous periods. If the amount still falls short, the Company shall make provisions from the total amount of after-tax net income for the period and other profit items adjusted to the current year’s undistributed earnings other than after- tax net income for the period. The Company may distribute all or part of its dividends, profits, capital reserves or legal reserves in cash, provided that such decision is resolved in a Board meeting with at least two- thirds of directors present, supported by more than half of the attending Directors, and reported during a Shareholders’ Meeting afterwards. These decisions do not require the Shareholders’ Meeting resolution mentioned in the preceding paragraph. The Company may distribute earnings or reimburse losses at the end of each half-year, subject to compliance with The Company Act. Before interim earnings distribution, the Company shall estimate and retain the amount of taxes payable, reimburse previous losses, and make provisions for legal reserve as required by law. However, this excludes circumstances where legal reserves have accumulated to an amount equal to the paid-up capital. Earnings distribution in cash is subject to the Board of Directors' approval;	attending Directors, and reported during a Shareholders’ Meeting afterwards. These decisions do not require the Shareholders’ Meeting resolution mentioned in the preceding paragraph. The Company may distribute earnings or reimburse losses at the end of each half-year, subject to compliance with The Company Act. Before interim earnings distribution, the Company shall estimate and retain the amount of taxes payable, reimburse previous losses, and make provisions for legal reserve as required by law. However, this excludes circumstances where legal reserves have accumulated to an amount equal to the paid-up capital. Earnings distribution in cash is subject to the Board of Directors' approval; distribution through the issuance of new shares is subject to shareholders' resolution.

	After Amendments		Before Amendments	Description
	distribution through the issuance of new shares is subject to shareholders' resolution.
Article 31	The Company shall adopta stable earnings distribution principleafter taking into account financial, business, and operational factors.Subsequent to reimbursement of previous accumulated losses, and provision of legal reserve and special reserve, from the remaining amount of the after-tax net income for the period, not less than 10% shall be allocated as dividends, which may be distributed in cash or stock. Of which, cash dividend shall not be lower than 50% of the total dividends.~~All earnings distribution for~~ ~~the period shall be disbursed in whole.~~ ~~Earnings can be distributed in the form~~ ~~of cash dividend, stock dividend, or a~~ ~~combination of both, provided that the~~ ~~cash portion amounts to no less than~~ ~~20% of total dividends (cash plus~~ ~~stock) in the current year.~~ The Company may capitalize all or part of its capital reserves into share capital, subject to compliance with the law and the authority's instructions, in situations where the Company has no earnings to distribute in the current year, or if the amount of earnings is far less than the amount distributed in the previous year, or for whatever financial, business, and operational concerns the Company may have.	Article 31	The Company may choose to distribute all distributable earnings of the current yearafter taking into account financial, business, and operational factors. Earnings can be distributed in the form of cash dividend, stock dividend, or a combination of both, provided that the cash portion amounts to no less than 20% of total dividends (cash plus stock) in the current year. The Company may capitalize all or part of its capital reserves into share capital, subject to compliance with the law and the authority's instructions, in situations where the Company has no earnings to distribute in the current year, or if the amount of earnings is far less than the amount distributed in the previous year, or for whatever financial, business, and operational concerns the Company may have.	Indicate the proportion of cash and stock in earnings distribution.

	After Amendments	Before Amendments	Description
Article 35	(The above omitted) The 19th amendment was made on June 12, 2019.The 20th amendment was made on May 24, 2022.	Article 35 (The above omitted) The 18th amendment was made on June 7, 2016. The 19th amendment was made on June 12, 2019.	Include the amended date of the current meeting.

[Attachment 8]

HannsTouch Solution Incorporated

Articles of Incorporation (Before Amendments)

Section 1 General Provisions

Article 1 The Company shall be incorporated under the Company Act and its Chinese name is “ 和鑫光電股份有限公司 .” (HannsTouch Solution Inc. in the English language).

Article 2 The scope of business of the Company shall be as follows:

C801030 Precision Chemical Material Manufacturing
CB01010 Mechanical Equipment Manufacturing
CC01080 Electronics Components Manufacturing
CC01090 Manufacturer of Batteries and Accumulators
CE01030 Optical Instruments Manufacturing (limited to offsite production operation)
E602011 Refrigeration and Air Conditioning Engineering (limited to offsite production operation)
F113010 Wholesale of Machinery (limited to offsite production operation)
F113020 Wholesale of Electrical Appliances (limited to offsite production operation)
F113030 Wholesale of Precision Instruments (limited to offsite production operation)
F113110 Wholesale of Batteries (limited to offsite production operation)
F119010 Wholesale of Electronic Materials (limited to offsite production operation)
F219010 Retail Sale of Electronic Materials (limited to offsite production operation)
F401010 International Trade
IG03010 Energy Technical Services
F213010 Retail Sale of Electrical Appliances (limited to offsite production operation)
H703100 Real Estate Leasing (limited to offsite production operation)
ZZ99999 All business items that are not prohibited or restricted by law, except those that are subject to special approval.

Researching, developing, producing, fabricating and selling the following products:

(1) Large-size color filters and the related raw material;
(2) Solar cell modules;
(3) Touch-control liquid-crystal display (LCD);
(4) International trading business related to the aforementioned products.

Article 3 The total investment of the Company in other companies is not restricted by the Company Act, Article 13, which stipulates that the total amount of its investments shall not exceed 40% of the amount of its own paid-up capital. The Company shall be allowed to provide a guarantee for an external party in the industry.

Article 4 The Company shall establish its head office in Southern Taiwan Science Park. Where necessary, the Company shall establish subsidiaries, offices or factories at appropriate locations within or without the territory of the Republic of China in accordance with the resolution passed by the Board of Directors.

Section 2 Shareholdings

Article	5	The total capital stock of the Company shall be in the amount of 20,000,000,000 New Taiwan Dollars,
		divided into 2,000,000,000 shares, at ten New Taiwan Dollars each. The Board of Directors is authorized
		to issue the unissued stocks in batches according to business needs. For the above total capital stock,
		1,300,000,000 New Taiwan Dollars shall be reserved for issuing employee stock options, for a total of
		130,000,000, at ten New Taiwan Dollars each. The Board of Directors is authorized to issue the unissued
		stocks in batches according to business needs.
Article	6	The Company shall be exempted from printing any share certificate for the shares issued. If, however, the
		Company decides to print share certificates for shares issued, they shall be name-bearing share certificates
		and the Company shall comply with relevant provisions of the Company Act and relevant rules and
		regulations for the issuance.
Article	7	(Deleted)
Article	8	For the transfer of shares, the transferor and transferee shall submit an application for the transfer to the
		Company.
Article	9	Assignment or transfer of shares shall not be set up as a defense against the issuing company unless the
		name or title and residence or domicile of the assignee or transferee have been recorded in the shareholder
		register.
Article	10	Unless otherwise provided, the Company shall conduct the stock matters in accordance with the law and
		regulations as stipulated by the competent authority.
Article	11	(Deleted)
Article	12	Registration for transfer of shares shall be suspended within sixty (60) days prior to a convening date of a
		regular shareholders’ meeting, or within thirty (30) days prior to a convening date of a special
		shareholders’ meeting, or within five (5) days prior to the record date scheduled by the Company for
		distribution of dividends, bonuses, or other benefits.

Section 3 Shareholders’ Meetings

Article	13	There are two types of shareholders’ meetings for the Company, namely: (1) regular meeting and (2)
		special meeting. Regular meetings shall be convened by the Board of Directors within six (6) months
		after the close of each fiscal year. The shareholders shall be notified 30 days prior to the regular meeting.
		Extraordinary meetings shall be convened when necessary. The shareholders shall be notified 15 days
		prior to the special meeting.

Article	13-1	For the shareholders’ meeting, a shareholder holding 1% or more of the total number of issued shares
		may submit to the Company a written proposal for discussion at a regular shareholders' meeting during
		the time period allowed as announced by the Company. The acceptance of shareholders’ proposals shall
		be conducted in accordance with the Company Act and other law and regulations.
Article	14	In event of the shareholder is unable to attend the shareholders’ meeting in person, he or she may appoint
		a proxy to attend on his or her behalf by conferring the power of attorney printed by the Company to the
		proxy, with the scope of authority well documented and in accordance with the Company Act and
		“Regulations Governing the Use of Proxies for Attendance at Shareholder Meetings of Public
		Companies.”
Article	15	The Chairperson of the Board of Directors shall preside at the meeting. When the Chairperson is unable
		to do so, he or she shall designate one of the Directors to preside over the meeting. If no Director is
		designated by the Chairperson, the Directors shall elect a person among themselves to preside at the
		meeting.
Article	16	Except as otherwise stipulated by the Company Act or the related law and regulations, a shareholder shall
		have one vote per share.
Article	16-1	At the shareholders’ meeting, the shareholders may cast their votes either in written or electronic form, as
		resolved by the Board of Directors’ meeting. The Board of Directors shall detail in the shareholders’
		meeting notice whether the voting method shall be conducted in written or electronic form. Other related
		procedures shall be conducted in accordance with the Company Act and other regulations.
Article	17	Except as otherwise provided in the related law and regulations, the resolutions of the shareholders’
		meeting shall be adopted if the meeting is attended by shareholders in person or by proxy representing
		more than one half of the total issued and outstanding capital stock of the Company, and the resolutions
		receiving the concurrence of a majority of the votes held by shareholders present at the meeting.
Article	18	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 chairperson of the meeting, and a copy shall be
		distributed to each shareholder within 20 days after the conclusion of the meeting. The Company may
		distribute the meeting minutes of the preceding paragraph by electronic public announcement.

Section 4 Directors

Article	19	The Company shall have five to nine Directors. The Board of Directors shall be authorized to determine
		the number of Directors. The number of independent Directors shall not be less than three persons or
		one-fifth of the total number of Directors.
		The shareholders with voting rights may provide the recommended director candidates as the reference
		for the next election of the Board of Directors. The Chairperson shall be elected among the Board of
		Directors by a majority in a meeting attended by over two-thirds of the Directors. The Chairperson shall

		have the authority to represent the Company externally. The Vice Chairperson shall be elected in the
		same manner.
Article	19-1	Since the election of the seventh Board of Directors, pursuant to the Securities and Exchange Act, Article
		14-4, the Company has established the Audit Committee. The Audit Committee shall be organized by
		Independent Directors. The Audit Committee or its members shall undertake the Supervisor's duties, as
		stipulated in the Company Act, Securities and Exchange Act and other regulations.
		The Company established the Audit Committee after the Annual General Shareholders’ Meeting in 2015.
		The position of Supervisor was discharged after the establishment of the Audit Committee. The
		provisions of these Articles pertaining to the Supervisor shall be invalid.
Article	20	The term of office for Directors shall be three (3) years, and all Directors shall be eligible for re-election.
Article	20-1	The election of Directors shall adopt the candidate nomination system stipulated in the Company Act,
		Article 192-1. Matters regarding the acceptance of nomination, public announcements et. cetera shall be
		conducted in accordance with the Company Act, Securities and Exchange Act and other regulations.
		The election of Directors shall be conducted in accordance with the Regulations Governing the Election
		of Directors and Independent Directors. Unless stated otherwise, as stipulated by the law and regulations,
		the election of both Directors and Independent Directors shall be conducted in the same election. The
		respective votes shall be separately calculated to determine the elected Independent Directors and non-
		Independent Directors.
		The number of shares held by the total Directors shall not be lower than the amount provided in the
		regulations as stipulated by the competent authority.
Article	21	When the number of Directors falls short by one-third of the total number of Directors, or all the
		Independent Directors are discharged, the Company shall call an extraordinary shareholders’ meeting
		within 60 days from the date of occurrence to hold a by-election to fill the vacancies. Unless all Directors
		are subject to re-election, the term of office of Director replaced through by-election shall fulfill the
		unexposed term of office of the predecessor.
Article	22	The guideline for management and other important matters of the Company shall be determined via
		resolutions that the Board of Directors passes. The Board meetings are convened and presided by the
		Chairperson, except for the first Board meeting of the newly elected Board of Directors, which is
		convened by the Director representing the highest numbers of voting rights. When the Chairperson is
		unable to perform his or her duties, the Vice Chairperson shall do so in the Chairperson’s place. If there
		is no Vice Chairperson or the Vice Chairperson is also unable to perform the duties, the Chairperson shall
		designate one of the Directors to do so in the Chairperson’s place. If no Director is designated by the
		Chairperson, the Directors shall elect a person among themselves to perform the duties in the
		Chairperson’s place.
Article	22-1	To convene the Board of Directors meeting, the Company shall state the purpose of convening the
		meeting definitively and notify the Directors seven (7) days before the meeting. In case of emergency,

the Company may convene the Board of Directors meeting at any time. Except as otherwise stipulated by the Company Act or these Articles, Directors shall attend the Board meetings in person. Any Director attending the meeting via video conference shall be deemed attending the meeting in person. The notification to the Directors for convening the Board of Directors meeting may be issued by written correspondences, facsimile or e-mails and other avenues.

Article 22-2 The Company shall purchase liability insurance for the Directors during their term of office and for the scope of their duties in accordance with the law and regulations to mitigate and diversify the risks of paying substantial damages facing the Company and Directors. The Board of Directors is authorized to determine the sum insured after taking reference to the domestic and foreign industry standard.

Article 23 Except as otherwise stipulated by the Company Act, Board meetings shall be attended by a majority of the Directors. In the event a Director is unable to attend the Board meeting in person, he or she may appoint a proxy to attend on his or her behalf by conferring the power of attorney that documents the scope of authority to the proxy. However, each Director may appoint only one proxy for any given Board meeting. The resolutions receiving the concurrence of a majority of the Directors present at the meeting shall be adopted.

Article 24 (Deleted) Article 25 The Company shall be authorized to appoint consultants with the concurrence of a majority of the Directors.

Section 5 Managers and Employees

Article 26 The Company shall appoint managers according to its operational needs.
Article 27 The appointment, termination and remuneration of Vice Presidents or above shall be undertaken in accordance with the provisions of the Company Act, Article 29.

Section 6 Earnings Distribution

Article 28 After the closing of each fiscal year, the following reports shall be prepared by the Board of Directors and submitted to the Audit Committee for review before submitting to the Annual General Shareholders’ Meeting for ratification:

I. Business Report.

II. Financial Statements.

III. Proposals Concerning the Distribution of Earnings or Covering of Losses.

Article 29 For a profitable fiscal year, the Company shall appropriate 0.001% to 15% of the profit as employee compensation and not more than 2% as Director remuneration. However, profits must first be used to offset cumulative losses, if any.

The distribution of the aforementioned employee compensation, whether in the form of stocks or cash, shall be determined by the resolution passed by the Board of Directors. The recipients of the employee compensation include eligible employees of the entities controlled by the Company or subordinate companies which have fulfilled certain criteria, as stipulated by the Board of Directors or the authorized personnel to set the said criteria. The above director's remuneration can only be paid in cash. The Board of Directors shall be authorized to determine the definition of “entities controlled by the Company or subordinate companies which have fulfilled certain criteria”; or the Board of Directors shall appoint the Chairperson to do so.

The Director(s) or shareholder(s) who is (are) designated to conduct the business operations of the Company shall authorize the Board of Directors to disburse salary or honorarium according to the industry standard, regardless of whether the Company is profitable or otherwise.

Article 30 Earnings concluded in a year are first subject to taxation and reimbursement of previous accumulated losses, followed by a 10% provision for legal reserves. However, no further provision of legal reserve is required if the Company has accumulated legal reserves to an amount equal to the paid-up capital. Any earnings remaining shall be added to undistributed earnings carried from previous years and distributed as shareholder dividends or retained at the Board of Directors' proposal, subject to resolution in a Shareholders’ Meeting. The Company may distribute all or part of its dividends, profits, capital reserves or legal reserves in cash, provided that such decision is resolved in a Board meeting with at least twothirds of directors present, supported by more than half of the attending Directors, and reported during a Shareholders’ Meeting afterwards. These decisions do not require the Shareholders’ Meeting resolution mentioned in the preceding paragraph. The Company may distribute earnings or reimburse losses at the end of each half-year, subject to compliance with The Company Act. Before interim earnings distribution, the Company shall estimate and retain the amount of taxes payable, reimburse previous losses, and make provisions for legal reserve as required by law. However, this excludes circumstances where legal reserves have accumulated to an amount equal to the paid-up capital. Earnings distribution in cash is subject to the Board of Directors' approval; distribution through the issuance of new shares is subject to shareholders' resolution. Article 31 The Company may choose to distribute all distributable earnings of the current year after taking into account financial, business, and operational factors. Earnings can be distributed in the form of cash dividend, stock dividend, or a combination of both, provided that the cash portion amounts to no less than 20% of total dividends (cash plus stock) in the current year. The Company may capitalize all or part of its capital reserves into share capital, subject to compliance with the law and the authority's instructions, in situations where the Company has no earnings to distribute in the current year, or if the amount of earnings is far less than the amount distributed in the previous year, or for whatever financial, business, and operational concerns the Company may have.

Section 7 Supplementary Provisions

Article 32 The Company shall undertake matters not stipulated by the Articles in accordance with the Company Act and other relevant laws and regulations.

Article 33 The policies, regulations and procedures of the Company shall be established separately by the Board of Directors. Article 34 The Articles shall be adopted after resolved by the shareholders’ meeting and registered with the administration. The same applies for the amendments to the Articles. Article 35 The Articles of Incorporation were established on September 8, 1999. The 1st amendment was made on October 22, 1999. The 2nd amendment was made on March 1, 2000. The 3rd amendment was made on May 3, 2001. The 4th amendment was made on April 8, 2002. The 5th amendment was made on July 11, 2002. The 6th amendment was made on April 24, 2003. The 7th amendment was made on April 23, 2004. The 8th amendment was made on April 28, 2005. The 9th amendment was made on June 15, 2006. The 10th amendment was made on June 15, 2007. The 11th amendment was made on June 13, 2008. The 12th amendment was made on June 16, 2009. The 13th amendment was made on June 15, 2010. The 14th amendment was made on June 15, 2011. The 15th amendment was made on June 18, 2012. The 16th amendment was made on May 30, 2014. The 17th amendment was made on June 3, 2015. The 18th amendment was made on June 7, 2016. The 19th amendment was made on June 12, 2019.

HannsTouch Solution Incorporated

Chairman WeiHsin Ma

[Attachment 9]

HannsTouch Solution Incorporated

Comparison Table of the Regulations Governing the Acquisition and Disposal of Assets

After Amendments	After Amendments		Before Amendments	Description
8.1 “Assets” used herein means: (1) equities, bonds, corporate bonds, bank indentures, security interest in funds, depository receipts, call (put) warrants, beneficiary securities, asset-based securities, short-term investments. (2) property (including investment propert~~y~~ ~~and inventories of construction developers)~~ plants and equipment. (3) memberships. (4) patents, copyrights, trademarks, franchise rights and other intangible assets; (5) right-of-use assets. (6) claims of financial institutions (including receivables, bills purchased and discounted, loans, and overdue receivables). (7) Derivatives. (8) Assets acquired or disposed of in connection with merger, demerger, acquisition, or transfer of shares in accordance with law. (9) Other major assets.		8.1	“Assets” used herein means: (1) equities, bonds, corporate bonds, bank indentures, security interest in funds, depository receipts, call (put) warrants, beneficiary securities, asset-based securities, short-term investments. (2) property (including investment property and inventories of construction developers) plants and equipment. (3) memberships. (4) patents, copyrights, trademarks, franchise rights and other intangible assets; (5) right-of-use assets. (6) claims of financial institutions (including receivables, bills purchased and discounted, loans, and overdue receivables). (7) Derivatives. (8) Assets acquired or disposed of in connection with merger, demerger, acquisition, or transfer of shares in accordance with law. (9) Other major assets.	Amended pursuant to the actual scope of business of the Company.
8.2	Any professional appraiser and their officers, certified public accountants, attorneys or securities underwriters from whom the Company has acquired appraisal reports and opinions, shall satisfy the requirements as set forth as follows: (1) May not have previously received a final and unappealable sentence to imprisonment for 1 year or longer for a violation of the Regulations Governing the Acquisition and Disposal of Assets by Public Companies, the Company Act, the Banking Act of The	8.2	Any professional appraiser and their officers, certified public accountants, attorneys or securities underwriters from whom the Company has acquired appraisal reports and opinions, shall satisfy the requirements as set forth as follows: (1) May not have previously received a final and unappealable sentence to imprisonment for 1 year or longer for a violation of the Regulations Governing the Acquisition and Disposal of Assets by Public Companies, the Company Act, the Banking Act of The	Amendments made as per JGZFZ Document No.111038046 5 dated January 28, 2022 on Regulations Governing the Acquisition and Disposal

After Amendments Before Amendments Description Republic of China, the Insurance Act, the Republic of China, the Insurance Act, the of Assets by Financial Holding Company Act, or the Financial Holding Company Act, or the Public Business Entity Accounting Act, or for fraud, Business Entity Accounting Act, or for fraud, Companies. breach of trust, embezzlement, forgery of breach of trust, embezzlement, forgery of documents, or occupational crime. documents, or occupational crime. However, this provision does not apply if However, this provision does not apply if three years have already passed since three years have already passed since completion of service of the sentence, since completion of service of the sentence, since expiration of the period of a suspended expiration of the period of a suspended sentence, or since a pardon was received. sentence, or since a pardon was received. (2) May not be a related party or de facto (2) May not be a related party or de facto related party of any party to the transaction. related party of any party to the transaction. (3) If the Company is required to obtain (3) If the Company is required to obtain appraisal reports from two or more appraisal reports from two or more professional appraisers, the professional professional appraisers, the professional appraisers or appraisal officers may not be appraisers or appraisal officers may not be related parties or de facto related parties of related parties or de facto related parties of each other. each other. When issuing an appraisal report or opinion, When issuing an appraisal report or opinion, the personnel referred to in the preceding the personnel referred to in the preceding paragraph shall comply with industry codes of comply with industry codes of paragraph shall comply with the following: trading associations and the following: he following: (1) Prior to accepting a case, they shall (1) Prior to accepting a case, they shall prudently assess their own professional prudently assess their own professional capabilities, practical experience, and capabilities, practical experience, and independence.

When issuing an appraisal report or opinion, the personnel referred to in the preceding paragraph shall comply with industry codes of comply with industry codes of trading associations and the following: he following: (1) Prior to accepting a case, they shall prudently assess their own professional capabilities, practical experience, and independence.

(2) When reviewing a case, they shall appropriately plan and execute adequate working procedures, in order to produce a conclusion and use the conclusion as the basis for issuing the report or opinion. The related working procedures, data collected, and conclusion shall be fully and accurately specified in the case working papers. (3) They shall undertake an item-by-item evaluation of the comprehensiveness, accuracy, and reasonableness of the sources of data used, the parameters, and the

(2) When undertaking a case, they shall appropriately plan and execute adequate working procedures, in order to produce a conclusion and use the conclusion as the basis for issuing the report or opinion. The related working procedures, data collected, and conclusion shall be fully and accurately specified in the case working papers. (3) They shall undertake an item-by-item evaluation of the appropriateness, and reasonableness of the sources of data used, the

	After Amendments	Before Amendments	Before Amendments	Description
	parameters, and the information, as the basis for issuance of the appraisal report or the opinion. (4) They shall issue a statement attesting to the professional competence and independence of the personnel preparing the report or opinion, and that they have evaluated and found that the information used isappropriate andreasonable, and that they have complied with the applicable law and regulations. The preparation of information in the appraisal report shall take reference to the attachment of “Regulations Governing the Acquisition and Disposal of Assets by Public Companies” promulgated by the securities competent authority.	information, as the basis for issuance of the appraisal report or the opinion. (4) They shall issue a statement attesting to the professional competence and independence of the personnel preparing the report or opinion, and that they have evaluated and found that the information used is reasonableand accurate,and that they have complied with the applicable law and regulations. The preparation of information in the appraisal report shall take reference to the attachment of “Regulations Governing the Acquisition and Disposal of Assets by Public Companies” promulgated by the securities competent authority.
8.5	Property and related right-of-use assets thereof or security investments acquired for non-business use The individual transaction amount limits of property and related right-of-use assets thereof, or securities acquired by the Company and its subsidiaries for non- business use are as follows: (1) The total amount of property and related right-of-use assets thereof acquired for non- business purposes shall not exceed the shareholder equityof the Company or its individual subsidiaries in the latest financial statements. (2) The total amount of security investments acquired shall not exceed theshareholder equityof the Company or its individual subsidiaries in the latest financial statements. (3) The amount of investment in each individual security acquired shall not exceed	8.5	Property and related right-of-use assets thereof or security investments acquired for non-business use The individual transaction amount limits of property and related right-of-use assets thereof, or securities acquired by the Company and its subsidiaries for non- business use are as follows: (1) The total amount of property and related right-of-use assets thereof acquired for non- business purposes shall not exceed thenet worthof the Company or its individual subsidiaries in the latest financial statements. (2) The total amount of security investments acquired shall not exceed thenet worthof the Company or its individual subsidiaries in the latest financial statements. (3) The amount of investment in each individual security acquired shall not exceed 50% of thenet worthof the Company or its	Amend wordings

	After Amendments	Before Amendments	Description
50% ofshareholder equityof the Company or its individual subsidiaries in the latest financial statements. (4) The ceilings prescribed by the three preceding security investments are not applicable to strategic investments.		individual subsidiaries in the latest financial statements. (4) The ceilings prescribed by the three preceding security investments are not applicable to strategic investments.
8.6.3 Appraisal report Except for transactions with domestic government institutions, contracting third parties to construct on land owned or leased by the Company, or acquisition or disposal of equipment or related right-of-use assets thereof for business use, an appraisal report issued by a professional appraiser shall be obtained prior to the date of occurrence for any acquisition or disposal of property, equipment or related right-of-use assets thereof, for which the amount represents 20% of the Company’s paid-in capital or more than NT$300 million. Furthermore, the following provisions shall be complied with: (1) If for any special reason, restricted price, specific price, or special price must be used as a reference for the transaction price, the transaction shall be approved by the Board in advance. The above procedures shall also be followed in case the transaction terms are changed subsequently. (2) If the transaction price is over NT$1 billion, the Company shall retain at least two professional appraisers to perform the appraisal. (3) Where any one of the following circumstances applies with respect to the professional appraiser's appraisal results,		8.6.3 Appraisal report Except for transactions with domestic government institutions, contracting third parties to construct on land owned or leased by the Company, or acquisition or disposal of equipment or related right-of-use assets thereof for business use, an appraisal report issued by a professional appraiser shall be obtained prior to the date of occurrence for any acquisition or disposal of property, equipment or related right-of-use assets thereof, for which the amount represents 20% of the Company’s paid-in capital or more than NT$300 million. Furthermore, the following provisions shall be complied with: (1) If for any special reason, restricted price, specific price, or special price must be used as a reference for the transaction price, the transaction shall be approved by the Board in advance. The above procedures shall also be followed in case the transaction terms are changed subsequently. (2) If the transaction price is over NT$1 billion, the Company shall retain at least two professional appraisers to perform the appraisal. (3) Where any one of the following circumstances applies with respect to the professional appraiser's appraisal results,	As per 8.2. External experts have complied with industry codes of their trading associations, including certified public accountants who offer opinions have implemented the procedures. As such, the relevant provisions are omitted.

After Amendments		Before Amendments	Description
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 render a specific opinion regarding the reason for the discrepancy and the reasonableness of the transaction price: 1. The discrepancy between the appraisal result and the transaction amount exceeds 20% of the transaction amount. 2. The discrepancy between the appraisal results of two or more professional appraisers exceeds 10% of the transaction amount. (4) No more than three months may elapse between the date of the appraisal report issued by a professional appraiser and the contract execution date However, where the publicly announced current value for the same period is used and not more than six months have elapsed, an opinion may still be issued by the original professional appraiser. The computation of the transaction amount shall be made as per Article 8.13.1, Paragraph 2 of these Regulations. “Within the preceding year,” as used in the preceding paragraph, refers to one year preceding the date of the event of the subject acquisition or disposal of assets. Appraisal report provided by a professional appraiser or opinion offered by a certified public accountant shall be excluded.		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 render a specific opinion regarding the reason for the discrepancy and the reasonableness of the transaction price~~in~~ ~~accordance with the provisions of~~ ~~Statement of Auditing Standards No. 20~~ ~~published by the ROC Accounting~~ ~~Research and Development Foundation~~ ~~("ARDF"):~~ 1. The discrepancy between the appraisal result and the transaction amount exceeds 20% of the transaction amount. 2. The discrepancy between the appraisal results of two or more professional appraisers exceeds 10% of the transaction amount. (4) No more than three months may elapse between the date of the appraisal report issued by a professional appraiser and the contract execution date However, where the publicly announced current value for the same period is used and not more than six months have elapsed, an opinion may still be issued by the original professional appraiser. The computation of the transaction amount shall be made as per Article 8.13.1, Paragraph 2 of these Regulations. “Within the preceding year,” as used in the preceding paragraph, refers to one year preceding the date of the event of the subject acquisition or disposal of assets.

After Amendments		Before Amendments	Description
		Appraisal report provided by a professional appraiser or opinion offered by a certified public accountant shall be excluded.
8.7.3 Expert opinion Before the date of occurrence of the acquisition or disposal of securities, the latest financial statements of the target company audited or reviewed by a certified public accountant shall be obtained for the assessment and reference of the transaction price. Should the transaction price reach 20% of the Company’s paid-in capital or exceed NT$300 million, an opinion on the reasonableness of the transaction price issued by a certified public accountant shall be obtained before the date of occurrence of such acquisition or disposal of securities. However, these requirements are not applicable if such securities are quoted on an active market or if any of the following rules of the securities competent authority are met: (1) Securities acquired through cash contribution in incorporation by promotion or by public offering. (2) Participation in subscription to an issue of securities issued at face value by an issuing company. (3) Participation in subscription to securities issued by a 100-percent owned investee company that is carrying out a cash capital increase. (4) Securities listed and traded on the Taiwan Stock Exchange (TWSE) or on the GreTai Securities Market (GTSM) and emerging stocks. (5) Government bonds or bonds in	8.7.3	Expert opinion Before the date of occurrence of the acquisition or disposal of securities, the latest financial statements of the target company audited or reviewed by a certified public accountant shall be obtained for the assessment and reference of the transaction price. Should the transaction price reach 20% of the Company’s paid-in capital or exceed NT$300 million, an opinion on the reasonableness of the transaction price issued by a certified public accountant shall be obtained before the date of occurrence of such acquisition or disposal of securities.~~If~~ ~~the certified public accountant engaged~~ ~~adopts the report of an expert as evidence,~~ ~~such certified public accountant shall do so~~ ~~in accordance with the provisions of~~ ~~Auditing Standard No. 20~~. However, these requirements are not applicable if such securities are quoted on an active market or if any of the following rules of the securities competent authority are met: (1) Securities acquired through cash contribution in incorporation by promotion or by public offering. (2) Participation in subscription to an issue of securities issued at face value by an issuing company. (3) Participation in subscription to securities issued by a 100-percent owned investee company that is carrying out a cash capital increase. (4) Securities listed and traded on the	As above.

After Amendments	Before Amendments	Description
repurchase or reverse purchase agreements. (6) Domestic funds or overseas funds. (7) TWSE or GTSM listed securities acquired or disposed of in accordance with the TWSE or GTSM rules governing the purchase of listed securities by reverse auction or rules governing the auction of listed securities. (8) Participation in subscription to shares issued by a public company for a cash capital increase, with the further requirement that the securities acquired are not privately placed securities. (9) Subscription to fund shares before the establishment of the fund in accordance with Article 11, paragraph 1 of the Securities Investment Trust and Consulting Act and the Financial Supervisory Commission Order No. IV-0930005249 dated 1 November 2004. (10) Subscription or redemption of domestic private placement funds, provided that the trust agreement for the fund specifies an investment strategy in which, aside from securities margin transactions and open positions held in securities-related products, the investment scope of the remaining portion is the same as that of a publicly offered fund. The computation of the transaction amount shall be made as per Article 8.13.1, Paragraph 2 of these Regulations. “Within the preceding year,” as used in the preceding paragraph, refers to one year preceding the date of the event of the subject acquisition or disposal of assets. Appraisal report provided by a professional	Taiwan Stock Exchange (TWSE) or on the GreTai Securities Market (GTSM) and emerging stocks. (5) Government bonds or bonds in repurchase or reverse purchase agreements. (6) Domestic funds or overseas funds. (7) TWSE or GTSM listed securities acquired or disposed of in accordance with the TWSE or GTSM rules governing the purchase of listed securities by reverse auction or rules governing the auction of listed securities. (8) Participation in subscription to shares issued by a public company for a cash capital increase, with the further requirement that the securities acquired are not privately placed securities. (9) Subscription to fund shares before the establishment of the fund in accordance with Article 11, paragraph 1 of the Securities Investment Trust and Consulting Act and the Financial Supervisory Commission Order No. IV-0930005249 dated 1 November 2004. (10) Subscription or redemption of domestic private placement funds, provided that the trust agreement for the fund specifies an investment strategy in which, aside from securities margin transactions and open positions held in securities-related products, the investment scope of the remaining portion is the same as that of a publicly offered fund. The computation of the transaction amount shall be made as per Article 8.13.1, Paragraph 2 of these Regulations. “Within the preceding year,” as used in the

After Amendments	Before Amendments	Description
appraiser or opinion offered by a certified public accountant shall be excluded.	preceding paragraph, refers to one year preceding the date of the event of the subject acquisition or disposal of assets. Appraisal report provided by a professional appraiser or opinion offered by a certified public accountant shall be excluded.
8.8.3 Expert opinion Except for transactions with domestic government institutions, before the date of occurrence of the acquisition or disposal of intangible assets, related right-of-use assets thereof or membership, should the transaction price reach 20% of the Company’s paid-in capital or more than NT$300 million, an opinion on the reasonableness of the transaction price issued by a certified public accountant shall be obtained before the date of occurrence of such acquisition or disposal of securities.	8.8.3 Expert opinion Except for transactions with domestic government institutions, before the date of occurrence of the acquisition or disposal of intangible assets, related right-of-use assets thereof or membership, should the transaction price reach 20% of the Company’s paid-in capital or NT$300 million, an opinion on the reasonableness of the transaction price issued by a certified public accountant shall be obtained before the date of occurrence of such acquisition or disposal of securities.~~The certified~~ ~~public accountant engaged shall do so in~~ ~~accordance with the provisions of Auditing~~ ~~Standard No. 20.~~	As above.
8.9.1 Procedures for resolution passing and content of a proposal If the Company intends to acquire or dispose of property or related right-of-use assets thereof from or to a related party, or when it intends to acquire or dispose of assets other than property or related right- of-use assets thereof from or to a related party and the transaction amount reaches 20% of the Company’s paid-in capital, 10% of the Company’s total assets, or more than NT$300 million, (except for buying or selling domestic government bonds, bonds under repurchase and resale agreements and subscribing or redeeming money	8.9.1 Procedures for resolution passing and content of a proposal If the Company intends to acquire or dispose of property or related right-of-use assets thereof from or to a related party, or when it intends to acquire or dispose of assets other than property or related right- of-use assets thereof from or to a related party and the transaction amount reaches 20% of the Company’s paid-in capital, 10% of the Company’s total assets, or more than NT$300 million, (except for buying or selling domestic government bonds, bonds under repurchase and resale agreements and subscribing or redeeming money	As per 8.2. By referring to the regulations of the international capital market, apart from strengthening the management of related party transactions and amending parent-

After Amendments		Before Amendments	Description
market funds issued by domestic securities investment trusts), the Company shall submit the following information to the Audit Committee and Board for approval prior to entering into any transaction contract or making payment: (1) The purpose, necessity and anticipated benefit of the proposed acquisition or disposal of assets. (2) The rationale for choosing the related party as a trading counterparty. (3) Information regarding the evaluation of the reasonableness of the preliminary transaction terms in accordance with Articles 8.9.2 and 8.9.3 with respect to the acquisition of property or related right-of- use assets thereof from a related party. (4) The date and price at which the related party originally acquired the property, the original trading counterparty, and such trading counterparty’s relationship to the Company and such related party. (5) Monthly cash flow forecasts for the year commencing from the anticipated month of the signing of the contract, an evaluation of the necessity of the transaction, and reasonableness of the funds' utilization. (6) An appraisal report from a professional appraiser or an opinion by a certified public accountant obtained in compliance with Article 8.9. (7) Restrictive covenants and other important stipulations associated with the transaction. With respect to the following transactions between the Company and its parent		market funds issued by domestic securities investment trusts), the Company shall submit the following information to the Audit Committee and Board for approval prior to entering into any transaction contract or making payment: (1) The purpose, necessity and anticipated benefit of the proposed acquisition or disposal of assets. (2) The rationale for choosing the related party as a trading counterparty. (3) Information regarding the evaluation of the reasonableness of the preliminary transaction terms in accordance with Articles 8.9.2 and 8.9.3 with respect to the acquisition of property or related right-of- use assets thereof from a related party. (4) The date and price at which the related party originally acquired the property, the original trading counterparty, and such trading counterparty’s relationship to the Company and such related party. (5) Monthly cash flow forecasts for the year commencing from the anticipated month of the signing of the contract, an evaluation of the necessity of the transaction, and reasonableness of the funds' utilization. (6) An appraisal report from a professional appraiser or an opinion by a certified public accountant obtained in compliance with Article 8.9. (7) Restrictive covenants and other important stipulations associated with the transaction. The computation of transaction amount shall be made as per these Regulations,	subsidiary transactions, for the acquisition or disposal of assets by a related party exceeding 10% of the Company’s total assets, approval from the General Shareholders’ Meeting shall be obtained before proceeding with the execution.

After Amendments		Before Amendments	Description
company, subsidiaries, or between subsidiaries whose shares or capital are 100% owned, directly or indirectly, by the Company, the Board may based on “Guidelines on Hierarchical Responsibility”, delegate the Chairman to decide such matters when the transaction is within a certain amount in accordance with Article 8.6 of and submit such transaction for ratification by the Board in its next meeting. (1) Acquisition or disposal of equipment or related right-of-use assets thereof for business use. (2) Acquisition or disposal of right-of-use assets of property for business use. When a matter is submitted to the Board for discussion pursuant to Paragraph 1, the Board shall take into full consideration each Independent Director’s opinion. Any objections or reservations regarding any matter expressed by an Independent Director shall be recorded in the minutes of the Board meeting. If the Company intends to acquire or dispose of property or related right-of-use assets thereof from or to a related party, or when it intends to acquire or dispose of assets other than property or related right- of-use assets thereof from or to a related party, it shall obtain approval of more than half of all Audit Committee members, and then submitted to the Board for approval by resolution. If approval of more than half of all Audit Committee members as required in the preceding paragraph is not obtained, such		Article 8.13.1, Paragraph 2.“Within the preceding year”as used in the preceding paragraph refers to one year preceding the date of the event of the subject acquisition or disposal of assets. Appraisal report provided by a professional appraiser or opinion offered by a certified public accountant shall be excluded. With respect to the following transactions between the Company and its parent company, subsidiaries, or between subsidiaries whose shares or capital are 100% owned, directly or indirectly, by the Company, the Board may based on “Guidelines on Hierarchical Responsibility”, delegate the Chairman to decide such matters when the transaction is within a certain amount in accordance with Article 8.6 of and submit such transaction for ratification by the Board in its next meeting. (1) Acquisition or disposal of equipment or related right-of-use assets thereof for business use. (2) Acquisition or disposal of right-of-use assets of property for business use. When a matter is submitted to the Board for discussion pursuant to Paragraph 1, the Board shall take into full consideration each Independent Director’s opinion. Any objections or reservations regarding any matter expressed by an Independent Director shall be recorded in the minutes of the Board meeting. If the Company intends to acquire or dispose of property or related right-of-use assets thereof from or to a related party, or

	After Amendments	Before Amendments	Description
	asset transaction could be 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 meeting. The terms "all Audit Committee members" and "all Directors" in Paragraph 5 shall be counted as the actual number of persons currently holding those positions. For transactions per Paragraph 1 between the Company and any subsidiaries that are not domestic public companies, when the transaction amount reaches 10% or more of the Company's total assets, the Company shall submit various types of information prescribed in Paragraph 1 to the General Shareholders’Meeting for approval prior to entering into a transaction contract or making a payment. However, for transactions between public companies and their parent companies or subsidiaries, or transactions between their subsidiaries, this restriction shall not apply. The computation of transaction amount for Paragraph 1 or the preceding paragraph shall be made as per these Regulations, Article 8.13.1, Paragraph 2.“Within the preceding year”as used in the preceding paragraph refers to one year preceding the date of the event of the subject acquisition or disposal of assets. Items duly announced in accordance with these Regulations that have been reported to the General Shareholders’Meeting, approved by the Board of Directors and ratified by the Supervisors shall be excluded.	when it intends to acquire or dispose of assets other than property or related right- of-use assets thereof from or to a related party, it shall obtain approval of more than half of all Audit Committee members, and then submitted to the Board for approval by resolution. If approval of more than half of all Audit Committee members as required in the preceding paragraph is not obtained, such asset transaction could be 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 meeting. The terms "all Audit Committee members" and "all Directors" in Paragraph 5 shall be counted as the actual number of persons currently holding those positions.

After Amendments	Before Amendments	Description
8.13.1 Circumstances and conditions required to be announced or reported If any of the following conditions relate to the Company’s acquisition or disposal of assets, the relevant information shall be declared and reported on the website designated by the securities competent authority according to the characteristics and prescribed format within two days from the date of occurrence: Acquisition or disposal of property or related right-of-use assets thereof from or to a related party, or acquisition or disposal of assets other than property or related right- of-use assets thereof from or to a related party where the transaction amount reaches more than 20% of the paid-in capital, more than 10% of the Company's total assets, or more than NT$300 million. However, the restriction shall not be applied to the trading of government bonds or bonds under repurchase and resale agreements and subscribing or redeeming money market funds issued by domestic securities investment trusts. (2) Merger, demerger, acquisition or transfer of shares. (3) The loss of trading derivatives reaches the limit for all or a single contract set forth in these Regulations for financial derivatives transactions. (4) Acquisition or disposal of equipment or related right-of-use assets thereof for business use from or to a related party and the transaction amount meet one of the following rules: 1. Public companies with paid-up capital	8.13.1 Circumstances and conditions required to be announced or reported If any of the following conditions relate to the Company’s acquisition or disposal of assets, the relevant information shall be declared and reported on the website designated by the securities competent authority according to the characteristics and prescribed format within two days from the date of occurrence: Acquisition or disposal of property or related right-of-use assets thereof from or to a related party, or acquisition or disposal of assets other than property or related right- of-use assets thereof from or to a related party where the transaction amount reaches more than 20% of the paid-in capital, more than 10% of the Company's total assets, or more than NT$300 million. However, the restriction shall not be applied to the trading of government bonds or bonds under repurchase and resale agreements and subscribing or redeeming money market funds issued by domestic securities investment trusts. (2) Merger, demerger, acquisition or transfer of shares. (3) The loss of trading derivatives reaches the limit for all or a single contract set forth in these Regulations for financial derivatives transactions. (4) Acquisition or disposal of equipment or related right-of-use assets thereof for business use from or to a related party and the transaction amount meet one of the following rules: 1. Public companies with paid-up capital	As per 8.2. Grant approval for trading foreign government bonds with credit rating not lower than the credit rating of ROC government bonds.

	After Amendments	Before Amendments	Description
	lower than NT$10 billion and transaction amount higher than NT$500 million. 2. Public companies with paid-up capital higher than NT$10 billion and transaction amounts higher than NT$1 billion. (5) Property acquired by 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, in which the trading counterparty is a related party and the amount the Company expects to invest in the transaction is more than NT$500 million. (6) Apart from asset transaction, disposal of receivables to a financial institution, or an investment in mainland China area in the preceding five subparagraphs, transaction that reaches 20% of the Company’s paid-in capital or amounts to NT$300 million or more. However, this shall not apply to the following circumstances: 1. Trading of government bondsor foreign government bonds whose credit rating is not lower than the credit rating of ROC. 2. Bonds under repurchase and resale agreements and subscribing or redeeming money market funds issued by domestic securities investment trusts. The amount of transactions above shall be calculated as follows: (1) The amount of any individual transaction. (2) The cumulative transaction amount of acquisitions and disposals of the same type	lower than NT$10 billion and transaction amount higher than NT$500 million. 2. Public companies with paid-up capital higher than NT$10 billion and transaction amounts higher than NT$1 billion. (5) Property acquired by 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, in which the trading counterparty is a related party and the amount the Company expects to invest in the transaction is more than NT$500 million. (6) Apart from asset transaction, disposal of receivables to a financial institution, or an investment in mainland China area in the preceding five subparagraphs, transaction that reaches 20% of the Company’s paid-in capital or amounts to NT$300 million or more. However, this shall not apply to the following circumstances: 1. Trading of government bonds. 2. Bonds under repurchase and resale agreements and subscribing or redeeming money market funds issued by domestic securities investment trusts. The amount of transactions above shall be calculated as follows: (1) The amount of any individual transaction. (2) The cumulative transaction amount of acquisitions and disposals of the same type of underlying asset with the same trading counterparty within the preceding year.

After Amendments	Before Amendments	Description
of underlying asset with the same trading counterparty within the preceding year. (3) The cumulative transaction amount of acquisitions and disposals (cumulative acquisitions and disposals, respectively) of properties or related right-of-use assets thereof in the same development project within the preceding year. (4) 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 preceding paragraph refers to the year preceding the date of occurrence of the current transaction. Items duly announced in accordance with these Regulations need not be counted toward the transaction amount.	(3) The cumulative transaction amount of acquisitions and disposals (cumulative acquisitions and disposals, respectively) of properties or related right-of-use assets thereof in the same development project within the preceding year. (4) 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 preceding paragraph refers to the year preceding the date of occurrence of the current transaction. Items duly announced in accordance with these Regulations need not be counted toward the transaction amount.

[Attachment 10]

HannsTouch Solution Incorporated

Regulations Governing the Acquisition and Disposal of Assets (Before Amendments)

1.0 Purpose

These Regulations are established to strengthen asset management and compliance with regulations governing information disclosure, and acquire or dispose assets appropriately to obtain maximum economic benefits in conjunction with company policies and full utilization of resources.

2.0 Scope

These Regulations are applicable according to the business and financial status of the Company.

3.0 Definitions of terminology

I. Derivatives:
"Derivatives" refers to 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 variables; or hybrid contracts combining the above contracts; or hybrid contracts or structured products containing embedded derivatives. "Forward contracts" do not include insurance contracts, performance contracts, after-sales service contracts, long-term leasing contracts, or long-term purchase (sales) contracts.
II. Assets acquired or disposed of in connection with a merger, demerger, acquisition, or transfer of shares in accordance with law:

Refers to assets acquired or disposed through merger, demerger, or acquisition conducted under the Business Mergers and Acquisitions Act, Financial Holding Company Act, Financial Institutions Merger Act and other acts, or to transfer shares from another company through issuance of new shares of its own as the consideration therefor (hereinafter "transfer of shares") under Article 156-3 of the Company Act.

III. Related party or subsidiary:

As defined in the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

IV. Professional appraiser:

Refers to a property appraiser or other person duly authorized by the law to engage in the value appraisal of property, plant or equipment.

V. Date of occurrence:

Refers to the date of contract signing, date of payment, date of consignment trade, date of transfer, dates of Boards of Directors resolutions, or other dates that can confirm the counterparty and monetary amount of the transaction, whichever date is earlier. However, for investment for which approval of the competent authority is required, the earlier of the above dates or the date of receipt of approval by the competent authority shall apply.

VI. 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.

VII. Securities exchange: "Domestic securities exchange" refers to the Taiwan Stock Exchange Corporation; "foreign securities exchange" refers to any organized securities exchange market that is regulated by the competent securities authorities of the jurisdiction where it is located.
VIII. Over-the-counter venue ("OTC venue", "OTC"): "Domestic OTC venue" refers to a venue for OTC trading provided by a securities firm in accordance with the Regulations Governing Securities Trading on the Taipei Exchange; "foreign OTC venue" refers to a venue at a financial institution that is regulated by the foreign competent authority and permitted to conduct securities business.
IX. “Latest financial statements” used herein means the financial statements of the Company audited or examined by a certified public accountant which has been disclosed in accordance with applicable regulation before the subject acquisition or disposal of assets.

4.0 Authorities

The relevant units of the Company are the basic competent authorities that are subject to the governance of these Regulations.

5.0 Reference

Regulations Governing the Acquisition and Disposal of Assets by Public Companies, as provided by Securities and Exchange Act, Article 36-1, and amended by JGZFZ Document No. 1070341072 dated November 26, 2018 as promulgated by Financial Supervisory Commission (hereafter, the competent authority of securities).

6.0 Precautions

None

7.0 Process flow diagram

None

8.0 Description of process flow diagram
8.1 “Assets” used herein means:
- (1) equities, bonds, corporate bonds, bank indentures, security interest in funds, depository receipts, call
  - (put) warrants, beneficiary securities, asset-based securities, short-term investments.
- (2) property (including investment property and inventories of construction developers) plants and equipment.
- (3) memberships.
- (4) patents, copyrights, trademarks, franchise rights and other intangible assets;
- (5) right-of-use assets.
- (6) claims of financial institutions (including receivables, bills purchased and discounted, loans, and overdue receivables).
- (7) Derivatives.
- (8) Assets acquired or disposed of in connection with merger, demerger, acquisition, or transfer of shares in accordance with law.
- (9) Other major assets.
8.2 Any professional appraiser and their officers, certified public accountants, attorneys or securities underwriters

from whom the Company has acquired appraisal reports and opinions, shall satisfy the requirements as set forth as follows:

(1) May not have previously received a final and unappealable sentence to imprisonment for 1 year or longer for a violation of the Regulations Governing the Acquisition and Disposal of Assets by Public Companies, 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 three 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.
(2) May not be a related party or de facto related party of any party to the transaction.
(3) If the Company is required to obtain appraisal reports from two or more professional appraisers, the professional appraisers or appraisal officers may not be related parties or de facto related parties of each other.

When issuing an appraisal report or opinion, the personnel referred to in the preceding paragraph shall comply with the following:

(1) Prior to accepting a case, they shall prudently assess their own professional capabilities, practical experience, and independence.
(2) When reviewing a case, they shall appropriately plan and execute adequate working procedures, in order to produce a conclusion and use the conclusion as the basis for issuing the report or opinion. The related working procedures, data collected, and conclusion shall be fully and accurately specified in the case working papers.
(3) They shall undertake an item-by-item evaluation of the comprehensiveness, accuracy, and reasonableness of the sources of data used, the parameters, and the information, as the basis for issuance of the appraisal report or the opinion.
(4) They shall issue a statement attesting to the professional competence and independence of the personnel preparing the report or opinion, and that they have evaluated and found that the information used is reasonable and accurate, and that they have complied with the applicable law and regulations.
The preparation of information in the appraisal report shall take reference to the attachment of “Regulations Governing the Acquisition and Disposal of Assets by Public Companies” promulgated by the securities competent authority.
8.3 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.
8.4 When an acquisition or disposal of assets is submitted for discussion by the Board pursuant to the law and regulations, the Board shall take into full consideration each Independent Director’s opinions. If an Independent Director objects to or expresses reservations about any matter, it shall be recorded in the minutes of the Board meeting.

For material asset or derivative transactions, the approval of one-half or more of all audit committee members shall be obtained before the transactions are submitted to the Board for resolution.

The terms "all Audit Committee members" and "all Directors" in Paragraph 3 shall be counted as the actual number of persons currently holding those positions.

8.5 Property and related right-of-use assets thereof or security investments acquired for non-business use The individual transaction amount limits of property and related right-of-use assets thereof, or securities acquired by the Company and its subsidiaries for non-business use are as follows:
(1) The total amount of property and right-of-use assets thereof acquired for non-business purposes shall not exceed the net worth of the Company or its individual subsidiaries in the latest financial statements.
(2) The total amount of security investments acquired shall not exceed the net worth of the Company or its individual subsidiaries in the latest financial statements.
(3) The amount of investment in each individual security acquired shall not exceed 50% of the net worth of the Company or its individual subsidiaries in the latest financial statements.
(4) The ceilings prescribed by the three preceding security investments are not applicable to strategic investments.
8.6 Procedures for acquisition or disposal of property, plant and equipment or related right-of-use assets thereof

8.6.1 Evaluation and handing process For the acquisition and disposal of property and related right-of-use assets thereof, the Company shall refer to publicly announced present value, assessed present value and actual sold price for the property in the neighborhood in determining the price, and terms and conditions of the transaction; for the acquisition and disposal of plant and equipment, and related right-of-use assets thereof, the Company shall select one of the avenues for valuation, namely making an inquiry about the price, or performing price comparison, or undertaking the bargain or tender process. The undertaking unit shall provide the rationale for acquisition or disposal, target asset, trading counterparty, terms and conditions of payment, transfer pricing and pricing reference in accordance with the relevant operating procedures prescribed by the internal control system of the Company. The Company shall submit the acquisition and disposal of property and related right-of-use assets thereof to the Chairperson for approval, and the Board of Directors for approval by resolution before proceeding. The acquisition or disposal of plant and equipment or related right-of-use assets thereof shall be authorized in accordance with the “Guidelines on Hierarchical Responsibility”. 8.6.2 Unit responsible The acquisition or disposal of property, plant, and equipment or related right-of-use assets thereof shall be undertaken in accordance with the aforementioned approval authorization and executed by the department using and managing the assets. 8.6.3 Appraisal report Except for transactions with domestic government institutions, contracting third parties to construct on land owned or leased by the Company, or acquisition or disposal of equipment or related right-of-

use assets thereof for business use, an appraisal report issued by a professional appraiser shall be obtained prior to the date of occurrence for any acquisition or disposal of property, equipment or related right-of-use assets thereof, for which the amount represents 20% of the Company’s paid-in capital or more than NT$300 million. Furthermore, the following provisions shall be complied with:

(1) If for any special reason, restricted price, specific price, or special price must be used as a reference for the transaction price, the transaction shall be approved by the Board in advance. The above procedures shall also be followed in case the transaction terms are changed subsequently.
(2) If the transaction price is over NT$1 billion, the Company shall retain at least two professional appraisers to perform the appraisal.
(3) 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 render a specific opinion regarding the reason for the discrepancy and the reasonableness of the transaction price in accordance with the provisions of Statement of Auditing Standards No. 20 published by the ROC Accounting Research and Development Foundation ("ARDF"):
The discrepancy between the appraisal result and the transaction amount exceeds 20% of the transaction amount.
The discrepancy between the appraisal results of two or more professional appraisers exceeds 10% of the transaction amount.
(4) No more than three months may elapse between the date of the appraisal report issued by a professional appraiser and the contract execution date However, where the publicly announced current value for the same period is used and not more than six months have elapsed, an opinion may still be issued by the original professional appraiser.

The computation of the transaction amount shall be made as per Article 8.13.1, Paragraph 2 of these Regulations. “Within the preceding year,” as used in the preceding paragraph, refers to one year preceding the date of the event of the subject acquisition or disposal of assets. Appraisal report provided by a professional appraiser or opinion offered by a certified public accountant shall be excluded.

8.7 Procedures for acquisition or disposal of securities
8.7.1 Evaluation and handing process

The acquisition or disposal of securities shall be undertaken in accordance with the operating procedures prescribed by the internal control system of the Company. Of which, the securities acquired or disposal via securities exchanges or OTC venues shall be determined by the then market prices. Whereas the securities acquired or disposal not via securities exchanges or OTC venues shall take into consideration the earnings per share, profitability and future development potential or market interest rate, bond coupon rate and credibility of creditors, as well as taking reference of securities expert opinion and the then transaction price negotiated.

The authorization limits and hierarchy for the acquisition or disposal of securities are as follows:

(1) Securities of capital movement and fund utilization nature:
1. For the acquisition or disposal of government bonds, short-term bills and conditional bond maturing within one year, the finance department is authorized to undertake the transactions.
2. For domestic and overseas bond funds and money market funds, the finance department shall refer to the supervisor of the finance and accounting center for authorization.
(2) For the remaining securities, not of capital movement and fund utilization nature, including government bonds, bank indentures, corporate bonds, depositary receipts, call and put warrants, beneficial interest securities, asset-backed securities and other equity securities, the Company shall submit to the Board of Directors for approval by resolution. If the acquisition or disposal caters to operating needs and is in compliance with the law and regulations, where the transaction amount is below NT$300 million (inclusive), the Chairperson may approve and proceed with the transaction, and submit such transaction for ratification by the Board subsequently.
8.7.2 Unit responsible

For the acquisition or disposal of securities, the undertaking unit shall obtain approval in accordance with authorization limits and the hierarchy prescribed by the preceding paragraphs. After obtaining approval, the finance department shall take charge of the execution.

8.7.3 Expert opinion

Before the date of the event of the acquisition or disposal of securities, the latest financial statements of the target company audited or reviewed by a certified public accountant, shall be obtained for the assessment and reference of the transaction price. Should the transaction price reach 20% of the Company’s paid-in capital or exceed NT$300 million, an opinion on the reasonableness of the transaction price issued by a certified public accountant shall be obtained before the date of the event of such acquisition or disposal of securities. If the certified public accountant engaged adopts the report of an expert as evidence, such certified public accountant shall do so in accordance with the provisions of Auditing Standard No. 20. However, these requirements are not applicable if such securities are quoted on an active market or if any of the following rules of the securities competent authority are met:

(1) Securities acquired through cash contribution in incorporation by promotion or by public offering.
(2) Participation in subscription to an issue of securities issued at face value by an issuing company.
(3) Participation in subscription to securities issued by a 100-percent owned investee company that is carrying out a cash capital increase.
(4) Securities listed and traded on the Taiwan Stock Exchange (TWSE) or on the GreTai Securities Market (GTSM) and emerging stocks.
(5) Government bonds or bonds in repurchase or reverse purchase agreements.
(6) Domestic funds or overseas funds.

(7) TWSE or GTSM listed securities acquired or disposed of in accordance with the TWSE or GTSM rules governing the purchase of listed securities by reverse auction or rules governing the auction of listed securities.
(8) Participation in subscription to shares issued by a public company for a cash capital increase, with the further requirement that the securities acquired are not privately placed securities.
(9) Subscription to fund shares before the establishment of the fund in accordance with Article 11, paragraph 1 of the Securities Investment Trust and Consulting Act and the Financial Supervisory Commission Order No. IV-0930005249 dated 1 November 2004.
(10) Subscription or redemption of domestic private placement funds, provided that the trust agreement for the fund specifies an investment strategy in which, aside from securities margin transactions and open positions held in securities-related products, the investment scope of the remaining portion is the same as that of a publicly offered fund.

8.8 Procedures for acquisition or disposal of intangible assets or related right-of-use assets thereof
8.8.1 Evaluation and handing process

The acquisition or disposal of membership, patents, copyrights, trademarks, franchise rights and other intangible assets or related right-of-use assets thereof shall be undertaken in accordance with the operating procedures prescribed by the internal control system of the Company. The acquisition or disposal of membership shall be restricted to the actual business needs. The transaction terms and price shall take into consideration the fair market value and the analytical report prepared shall be submitted to the Chairperson. For a single transaction below NT$5 million (inclusive), the Chairperson is authorized to make the decision. For a single transaction above NT$5 million, approval from the Board of Directors must be obtained before proceeding. The acquisition or disposal of intangible assets or related right-of-use assets thereof shall be restricted to the actual business needs. The transaction terms and price shall take into consideration the fair market value and the analytical report prepared shall be submitted to the Chairperson. For a single transaction below NT$20 million (inclusive), the Chairperson is authorized to make the decision. For a single transaction above NT$20 million, approval from the Board of Directors must be obtained before proceeding.

8.8.2 Unit responsible

For the acquisition or disposal of intangible assets or related right-of-use assets thereof or membership, the undertaking unit shall obtain approval in accordance with the approval authorization prescribed in the preceding paragraphs, and the legal department, finance department or administrative department shall take charge with the execution.

8.8.3 Expert opinion

Except for transactions with domestic government institutions, before the date of occurrence of the acquisition or disposal of intangible assets, related right-of-use assets thereof or membership, should the transaction price reach 20% of the Company’s paid-in capital or exceed NT$300 million, an opinion on the reasonableness of the transaction price issued by a certified public accountant shall be obtained before the date of occurrence of such acquisition or disposal of securities. The certified public accountant engaged shall do so in accordance with the provisions of Auditing Standard No. 20.

8.9 Procedures for related party transactions

For the acquisition or disposal of assets from or to a related party, apart from complying with procedures for resolution passing and evaluation of the reasonableness of the transaction terms prescribed in Articles 8.6, 8.7 and 8.8, the Company shall also comply with additional regulations thereof as follows: For transaction amounts exceeding 10% of the total assets of the Company, in accordance with Paragraphs 8.6.3, 8.7.3 and 8.8.3, the Company shall obtain an appraisal report provided by a professional appraiser or opinion offered by a certified public accountant.

The computation of transaction amount shall be made as per these Regulations, Article 8.13.1, Paragraph 2. “Within the preceding year” as used in the preceding paragraph refers to one year preceding the date of the event of the subject acquisition or disposal of assets. Appraisal report provided by a professional appraiser or opinion offered by a certified public accountant shall be excluded.

When determining whether a trading counterparty is a related party, in addition to legal formalities, the substance of the relationship shall also be considered.

8.9.1 Procedures for resolution passing and content of a proposal

If the Company intends to acquire or dispose of property or related right-of-use assets thereof from or to a related party, or when it intends to acquire or dispose of assets other than property or related right-of-use assets thereof from or to a related party and the transaction amount reaches 20% of the Company’s paid-in capital, 10% of the Company’s total assets, or more than NT$300 million, (except for buying or selling domestic government bonds, bonds under repurchase and resale agreements and subscribing or redeeming money market funds issued by domestic securities investment trusts), the Company shall submit the following information to the Audit Committee and Board for approval prior to entering into any transaction contract or making payment:

(1) The purpose, necessity and anticipated benefit of the proposed acquisition or disposal of assets.
(2) The rationale for choosing the related party as a trading counterparty.

(3) Information regarding the evaluation of the reasonableness of the preliminary transaction terms in accordance with Articles 8.9.2 and 8.9.3 with respect to the acquisition of property or related right-of-use assets thereof from a related party.

(4) The date and price at which the related party originally acquired the property, the original trading counterparty, and such trading counterparty’s relationship to the Company and such related party.

(5) Monthly cash flow forecasts for the year commencing from the anticipated month of the signing of the contract, an evaluation of the necessity of the transaction, and reasonableness of the funds' utilization.
(6) An appraisal report from a professional appraiser or an opinion by a certified public accountant obtained in compliance with Article 8.9.
(7) Restrictive covenants and other important stipulations associated with the transaction.

With respect to the following transactions between the Company and its parent company, subsidiaries, or between subsidiaries whose shares or capital are 100% owned, directly or indirectly, by the Company, the Board may based on “Guidelines on Hierarchical Responsibility”, delegate the Chairman to decide such matters when the transaction is within a certain amount in accordance with Article 8.6 of and submit such transaction for ratification by the Board in its next meeting.

(1) Acquisition or disposal of equipment or related right-of-use assets thereof for business use.

(2) Acquisition or disposal of right-of-use assets of property for business use.

When a matter is submitted to the Board for discussion pursuant to Paragraph 1, the Board shall take into full consideration each Independent Director’s opinion. Any objections or reservations regarding any matter expressed by an Independent Director shall be recorded in the minutes of the Board meeting.

If approval of more than half of all Audit Committee members as required in the preceding paragraph is not obtained, such asset transaction could be 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 meeting. The terms "all Audit Committee members" and "all Directors" in Paragraph 5 shall be counted as the actual number of persons currently holding those positions.

8.9.2 Evaluation of reasonableness on transaction costs

(1) When acquiring property or related right-of-use assets thereof from a related party, the Company shall evaluate the reasonableness of the transaction costs by the following means:
Based upon the related party's transaction price plus necessary interest on funding and the costs to be duly borne by the buyer in accordance with the law and regulations. "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-

100

financial industry lending rate announced by the Ministry of Finance.

  2. 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% or more of the financial institution's appraised loan value of the property and the period of the loan shall have been one year or more.  However, this shall not apply where the financial institution is a related party of one of the trading counterparties.

(2) Where land and structures thereupon are combined as a single property purchased 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.
(3) For the acquisition of property and related right-of-use assets thereof from a related party, the Company shall appraise the cost in accordance with the provisions of Article 8.9.2, Paragraphs 1 and 2, as well as engage a CPA to check the appraisal and render a specific opinion.
(4) For the acquisition of property or related right-of-use assets thereof from a related party, if one of the following circumstances is present, the transaction shall be undertaken in accordance with Article 8.9.1, whereas the Article 8.9.2, Paragraphs (1), (2) and (3) shall not be applicable:
1. The related party has acquired the property or related right-of-use assets thereof through inheritance or as a gift.
2. More than five years will have elapsed from the time the related party signed the contract to obtain the property or related right-of-use assets thereof to the signing date for the current transaction.
3. The property has been acquired through signing of a joint development contract with the related party, or through contract development with the related party as the developer to develop a land of the Company or leased from a third-party landowner.
4. The acquisition of the property or related right-of-use assets thereof is for business use and occurs between the Company and its parent company, subsidiaries, or between subsidiaries whose shares or capital are 100% owned, directly or indirectly, by the Company.
8.9.3 When the results of the Company's appraisal conducted in accordance with the provision of Article
8.9.2 for the acquisition of property or related right-of-use assets thereof from a related party are uniformly lower than the transaction price, the matter shall be handled as per the provisions of Article 8.9.4. However, where the following circumstances exist, objective evidence has been submitted and specific opinions on reasonableness have been obtained from a professional property appraiser and a CPA, this restriction shall not apply:
(1) 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 Article, 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

101

profit" shall be deemed the average gross operating profit margin of the related party's construction division over the most recent three 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.

Completed 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 practices or standard property leasing market practices.
(2) Where the Company acquiring property or leasing the related right-of-use of the property from a related party provides evidence that the terms of the transaction are similar to the terms of transactions completed for the acquisition of neighboring or closely valued parcels of land of a similar size by unrelated parties within the preceding year.

“Completed transactions for neighboring or closely valued parcels of land in the preceding

paragraph”, in principle, refers to transaction price or publicly announced current value of parcels on the same or an adjacent block and within a distance of no more than 500 meters; “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% of the property in the planned transaction; “within the preceding year “refers to the year preceding the actual date of acquisition of the property or related right-of-use assets thereof.

8.9.4 When the results of the Company's appraisal conducted in accordance with the provision of Articles 8.9.2 and 8.9.3 for the acquisition of property or related right-of-use assets thereof from a related party are uniformly lower than the transaction price, the matter shall be handled in compliance with the following provisions:
(1) A special reserve shall be set aside in accordance with the Securities and Exchange Act, Article 41, Paragraph 1 for the difference between the transaction price and the appraised cost of the property or related right-of-use assets thereof, and may not be distributed or used for capital increase or issuance of bonus shares. Where the investor using the equity method to account for its investment in the Company is a public company, then the special reserve shall be set aside pro rata in a proportion in accordance with the Exchange Act, Article 41, Paragraph 1.
(2) Where an Audit Committee has been established in accordance with the provisions of these Regulations, the preceding portion of this Subparagraph shall apply mutatis mutandis to the Independent Director members of the Audit Committee.
(3) Actions taken pursuant to the preceding two Subparagraphs shall be reported to the Shareholders’ Meeting, and the details of the transaction shall be disclosed in the annual report and any investment prospectus.
8.9.5 The Company that has set aside a special reserve under Article 8.9.4, Paragraph 1 may not utilize the special reserve until it has recognized a loss on decline in market value of the assets it purchased at a

102

premium or leased, or they have been disposed of, or the lease 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 is nothing unreasonable about the transaction, and has obtained the securities competent authority’s consent.

8.9.6 When the Company obtains property or related right-of-use assets thereof from a related party, it shall also comply with the provisions of Articles 8.9.4 and 8.9.5 if there is other evidence indicating that the acquisition was not an arm’s length transaction.
8.10 Procedures for acquisition or disposal of derivatives
8.10.1 Trading principles and strategies
- (1) Trading derivatives

The scope of derivatives acquired or disposed by the Company is mainly restricted to forward exchange, foreign exchange option, interest rate or foreign exchange swap. The Company shall seek the approval of the Chairperson before acquiring or disposing other derivatives.

(2) Hedging strategies

The acquisition or disposal of derivatives aims at mitigating the risks generated from the Company’s operation, especially hedging maturity periods, volume and net position after exposure netting from the receivables, payables or assets and liabilities generated from operation. Furthermore, the Company shall select companies with existing business ties as its trading counterparties to avoid credit risk. The transactions must be definitively distinguished as being non-hedging or financial for accounting purposes.

(3) Differentiation of transaction types
Hedging transactions:

Hedging transactions refer to derivative trading that the Company engages in mitigating foreign exchange or interest rate risks generated from operation, assets or liabilities.

Financial transactions:

Financial transactions refer to transactions other than hedging transactions above, where the purpose is to earn a profit from the spread.

(4) Division of duties and authority

For the acquisition or disposal of derivatives, the division of duties and authority are as follows:

Trading personnel:

Personnel who execute derivative transactions are responsible for preparing the relevant information on the derivatives, collecting regulatory provisions, designing hedging strategies, providing risk disclosure and producing hedging advice according to the operational strategy of the Company. Trading personnel are designated by the supervisor of the finance and accounting center. Furthermore, trading counterparties shall be informed prior to the appointment and discharge of trading personnel taking effect so as

103

to protect the Company’s interests.

Transaction confirmation personnel:

Transaction confirmation personnel are responsible for verifying transaction information with trading counterparties and informing the accounting department to process the booking.

Settlement personnel:

Settlement personnel are responsible for overseeing the settlement of derivative transactions and regularly reviewing the cash flow status to ensure the transaction agreement can be settled in a timely manner.

Accounting personnel:

Accounting personnel are responsible for processing accounting records and evaluation, and forward exchange transactions in accordance with International Financial Reporting Standards (IFRS). For other derivatives not governed by specific accounting standards, the processing shall be undertaken according to the opinion of CPA so as to accurately and fairly represent the gains and losses of the relevant transactions in the financial statements They shall also make a declaration in accordance with the provisions of the securities competent authority.

(5) Authorization limits and hierarchy:

The authorization limits and hierarchy are established according to the growth and changes of risks of the Company, and shall take effect after being approved by the Chairperson. The authorization limits and hierarchy are then reported to the Board of Directors for verification. Amendments shall be approved by the Chairperson before taking effect. To facilitate the trading counterparty in observing the supervision and management of the Company, the trading counterparty shall be informed of the authorization limits and hierarchy.

Authorization limits (equivalent in USD) and hierarchy for hedging transactions are as follows:

ollows:
Approval hierarchy	Single transaction amount	Weekly cumulative transaction amount
Head of finance and accounting center	US$5 million	US$10 million
Head of finance department	US$3 million	US$6 million
Authorization limits and hierarchy for non-hedging transactions are as follows:
Approval hierarchy	Single transaction amount	Weekly cumulative transaction amount
Head of finance and accounting center	US$5 million	US$10 million
Head of finance department	US$3 million	US$6 million

Authorization limits and hierarchy for non-hedging transactions are as follows:

(6) Contract amount and upper limit of losses

The total hedging contract amount shall be limited to the total of receivables, payables or net position of foreign currency assets and liabilities generated from operation in the next six months. The total non-hedging contract amount shall be limited to not more

104

than US$10 million. If the total contract amount exceeds US$10 million, approval from the Board of Directors shall be obtained before proceeding. However, derivative transaction contracts with actual positions or needs are not subject to restrictions. The upper limit of transaction losses for the acquisition or disposal of derivatives is as follows:

follows:
Upper limit of losses	All contracts	Single contract
Hedging transactions	15%	20%
Non-Hedging transactions	5%	10%

If the upper limit of all contracts or a single contract is breached, a written report shall

be submitted to the supervisor of the center and forwarded to the Board of Directors.

8.10.2 Risk management measures
(1) Credit risk: Select transaction counterparties that have transaction limits with the Company and are able to provide professional information. Avoid high concentration risk in transaction counterparty(ies).
(2) Market price risk: Closely monitor and control interest rate or foreign exchange fluctuation risks, or other risk factors causing fluctuation in the market price of derivatives.
(3) Liquidity risk: To ensure liquidity, the transaction counterparty must possess sufficient equipment, information, capital and trading capacity, and are able to trade in major international markets.
(4) Operational risk: Authorization limits and operating procedures must be closely observed to avoid operational risk.
(5) Legal risk: Any documents with the counterparties must be reviewed by the legal department of the legal consultant of the Company before signing to avoid legal risk.
(6) Financial product risk: The internal trading personnel must possess comprehensive and accurate professional knowledge of the financial products, and require the trading counterparties to fully disclosed the risks involved, so as to avoid losses due to misuse of financial products.
(7) Settlement risk: Apart from observing the rules prescribed in the authorization limits, the authorized trading personnel must pay attention to the cash flow of the Company regularly to ensure the Company has sufficient cash for settlement. Furthermore, the trading personnel shall also pay close attention to the credit status of the trading counterparties (banks) on a regular basis.
(8) The trading personnel shall not hold concurrent positions in transaction confirmation and settlement departments, and vice versa.
(9) For derivative transactions, the top management shall take charge of the measurement, supervision and control of risks, and report to the Board of Directors, or to top management personnel designated by the Board that is not in charge of the decision making of transaction or position. The aforementioned personnel who take charge of the measurement, supervision

105

and control of risks must not be from the transaction confirmation or settlement department.

8.10.3 Regular evaluation method and processing of anomalies
(1) The finance department shall make an evaluation on the derivative transaction position held by the Company at least once a week. However, for hedging transactions necessary for catering business needs, the finance department shall make two evaluations per month. The evaluation report shall be submitted to the top management personnel authorized by the Board.
(2) The top management personnel authorized by the Board shall regularly evaluate whether the performance of derivative transactions meets the existing management strategies and the risk is within the exposure limit of the Company. The personnel shall also regularly evaluate whether the risk management measures in use are compliant with the trading procedures established.
(3) The top management personnel authorized by the Board shall supervise the trading and monitor gains or losses of the Company. If any anomaly is found (e.g. the position breaches the upper limit of losses, etc.), the personnel must undertake the necessary countermeasures and report to the Board. If Independent Director positions have been established, the Independent Directors shall attend the Board meeting and express their opinion.
8.10.4 Internal audit
(1) Internal auditors shall regularly assess the reasonableness of the internal control measures on derivatives trading. On a monthly basis, internal auditors shall conduct an audit on the compliance of the trading department in procedures for engaging in derivatives trading, and thus prepare an audit report. If a material violation is found, a written notification shall be submitted to the Independent Directors.
(2) Internal auditors shall at the end of February of the following year, submit the audit report and annual internal audit report to the securities competent authority. No later than the end of May of the following year, internal auditors shall report the progress on improving anomalies to the securities competent authority for future reference.
8.10.5 Supervision and management principles of the Board of Directors
(1) For derivative trading, the Board shall undertake supervision and management in accordance with the following principles:
1. The designated top management shall pay close attention to the supervision and control of derivative trading risks.
2. The Board shall regularly evaluate whether the performance of derivative transactions meets the existing management strategies and the risk is within the exposure limit of the Company.
(2) In accordance with the following management principle of derivative trading, the top management personnel authorized by the Board shall:
1. regularly evaluate whether the risk management measures in use are compliant with

106

  - “Regulations Governing the Acquisition and Disposal of Assets by Public Companies” and these Regulations pertaining to the rules on derivatives trading.

  2. supervise the trading and monitor gains or losses of the Company. If any anomaly is found, the personnel must undertake the necessary countermeasures and report to the Board. If Independent Director positions have been established, the Independent Directors shall attend the Board meeting and express their opinion.

(3) The Company shall authorize relevant personnel to undertake derivative trading as prescribed by the relevant rules in these Regulations, and submit for ratification by the Board in its next meeting.
8.10.6 Establishment of log books

For derivative trading, the Company shall establish log books, listing the derivative types, amount, date of resolution passed by the Board and items prescribed in Article 8.10.3 (Subparagraph 1), Article 8.10.5 (Paragraph 1, Subparagraph 2) and Article 8.10.5 (Paragraph 2, Subparagraph 1) that require careful evaluation.

8.11 Procedures for undertaking merger, demerger, acquisition or transfer of shares
8.11.1 Evaluation and handing process
- (1) For merger, demerger, acquisition or transfer of shares, the Company shall engage lawyers, CPAs and underwriters to collectively determine the time schedule and organize a project team to execute the planning in accordance with legal procedures. Prior to convening the Board meeting, the Company shall engage CPAs, lawyers and underwriters to submit their opinion pertaining to the reasonableness of share exchange ratio, acquisition price or cash or other assets disbursed to shareholders for the deliberation and passage of the Board. However, the requirement of obtaining an aforesaid opinion on reasonableness issued by an expert may be exempted in the case of a merger by a public 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 public company directly or indirectly holds 100 percent of the respective subsidiaries' issued shares or authorized capital.
- (2) For merger, demerger, acquisition, or transfer of shares, the Company 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, and include the expert opinion referred to in Article 8.11.1, Paragraph 1 when sending shareholders the Shareholders’ Meeting Notice for their reference in deciding whether to approve the merger, demerger, or acquisition. However, where a provision of another act exempts the Company from convening a Shareholders’ Meeting to approve the merger, demerger, or acquisition, this restriction shall not apply. Furthermore, 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

107

proposal is rejected by the Shareholders’ Meeting, the companies participating in the merger, demerger or acquisition shall immediately publicly explain the reason, the follow-up measures, and the preliminary date of the next Shareholders’ Meeting.

8.11.2 Establishment and amendments to share exchange ratio and acquisition price:

Prior to the Board meetings of any one of the companies participating in a merger, demerger, acquisition or transfer of shares, the companies shall engage CPAs, lawyers and underwriters may submit their opinion pertaining to the reasonableness of share exchange ratio, acquisition price or cash or other assets disbursed to shareholders for the deliberation and passage of the Shareholders’ Meeting. In principle, the share exchange ratio or acquisition price shall not be subject to random change, except for other terms in the contract stipulating the conditions for alteration which have been publicly disclosed. Conditions for amendments to share exchange ratio and acquisition price:

(1) Cash capital increase, issuance of convertible corporate bonds, or the issuance of bonus shares, issuance of corporate bonds with warrants, preferred shares with warrants, stock warrants, or other equity based securities.
(2) An action, such as a disposal of major assets, that affects the Company's financial operations.
(3) An event, such as a major disaster or major change in technology, that affects shareholder equity or share price.
(4) An adjustment where any of the companies participating in the merger, demerger, acquisition, or transfer of shares from another company, buys back treasury stock.
(5) An increase or decrease in the number of entities or companies participating in the merger, demerger, acquisition, or transfer of shares.
(6) Other terms in the contract stipulating the conditions for alteration which have been publicly disclosed.

8.11.3 Content of contract

Apart from information prescribed in the Company Act, Article 317-1 and Business Mergers And Acquisitions Act, Article 22, the contract for participation in a merger, demerger, acquisition, or of shares shall also record the following:

(1) Handling of breach of contract.
(2) 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.
(3) The amount of treasury stock participating companies are permitted under law to buy back after the record date of share exchange ratio calculation, and the principles for handling thereof.
(4) The manner of handling changes in the number of participating entities or companies.
(5) Preliminary progress schedule for plan execution, and anticipated completion date.
(6) Scheduled date for convening the legally mandated shareholders meeting if the plan exceeds the deadline without completion, and relevant procedures.

108

8.11.4 Date of convening the Board of Directors Meeting and Shareholders’ Meeting:

A company participating in a merger, demerger, or acquisition shall convene a board of directors meeting and shareholders’ meeting on the day of the transaction 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. A company participating in a transfer of shares shall call a board of directors meeting on the day of the transaction, unless another act provides otherwise or the securities competent authority is notified in advance of extraordinary circumstances and grants consent.

(1) 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 transfer of another company's shares prior to disclosure of the information.

(2) Dates of material events:

Including the signing of any letter of intent or memorandum of understanding, the hiring of a financial or legal advisor, the execution of a contract, and the convening of a board of directors meeting.

(3) 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 the board of directors meeting.

When participating in a merger, demerger, acquisition, or transfer of another company's shares, a company that is listed on an exchange or has its shares traded on an OTC market shall, within 2 days counting inclusively from the date of passage of a resolution by the board of directors, report (in the prescribed format and via the Internet-based information system) the information set out in subparagraphs 1 and 2 of the preceding paragraph to the securities competent authority for recordation.

Where any of the companies participating in a merger, demerger, acquisition, or transfer of another company's shares is neither listed on an exchange nor has its shares traded on an OTC market, the company(s) so listed or traded shall sign an agreement with such company whereby the latter is required to abide by the provisions of the preceding two paragraphs.

8.11.5 Prior written undertaking of confidentiality

Every person participating in or privy to the plan for a merger, demerger, acquisition, or transfer 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

109

under the name of another person, in any stock or other equity security of any company related to the plan for a merger, demerger, acquisition, or transfer of shares.

8.11.6 Changes in the participating companies or entities:

After public disclosure of the information, if any company participating in the merger, demerger, acquisition, or share transfer intends further to carry out a merger, demerger, acquisition, or share transfer 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 share transfer; 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.

8.11.7 Where any of the companies participating in a merger, demerger, acquisition, or transfer of shares is not a public company, the Company shall sign an agreement with the non-public company whereby the latter is required to abide by the provisions of Articles 8.11.4, 8.11.5 and 8.11.6.
8.12 Procedures for handling the acquisition or disposal of claims of financial institutions
In principle, the Company does not engage in the acquisition or disposal of bank indentures. If it subsequently wishes to engage in the acquisition or disposal of bank indentures, the Company shall first establish the evaluation and handing procedures and submit them to the Board for approval by resolution before proceeding.
8.13 Procedures for information disclosure
8.13.1 Circumstances and conditions required to be announced or reported

If any of the following conditions relate to the Company’s acquisition or disposal of assets, the relevant information shall be declared and reported on the website designated by the securities competent authority according to the characteristics and prescribed format within two days from the date of occurrence:

(1) Acquisition or disposal of property or related right-of-use assets thereof from or to a related party, or acquisition or disposal of assets other than property or related right-of-use assets thereof from or to a related party where the transaction amount reaches more than 20% of the paid-in capital, more than 10% of the Company's total assets, or more than NT$300 million. However, the restriction shall not be applied to the trading of government bonds or bonds under repurchase and resale agreements and subscribing or redeeming money market funds issued by domestic securities investment trusts.
(2) Merger, demerger, acquisition or transfer of shares.
(3) The loss of trading derivatives reaches the limit for all or a single contract set forth in these Regulations for financial derivatives transactions.
(4) Acquisition or disposal of equipment or related right-of-use assets thereof for business use from or to a related party and the transaction amount meet one of the following rules:
Public companies with paid-up capital lower than NT$10 billion and transaction amount

110

higher than NT$500 million.

Public companies with paid-up capital higher than NT$10 billion and transaction amounts higher than NT$1 billion.
(5) Property acquired by 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, in which the trading counterparty is a related party and the amount the Company expects to invest in the transaction is more than NT$500 million.
(6) Apart from asset transaction, disposal of receivables to a financial institution, or an investment in mainland China area in the preceding five subparagraphs, transaction that reaches 20% of the Company’s paid-in capital or amounts to NT$300 million or more. However, this shall not apply to the following circumstances:
Trading of government bonds.
Bonds under repurchase and resale agreements and subscribing or redeeming money
market funds issued by domestic securities investment trusts.

The amount of transactions above shall be calculated as follows:

(1) The amount of any individual transaction.
(2) The cumulative transaction amount of acquisitions and disposals of the same type of underlying asset with the same trading counterparty within the preceding year.
(3) The cumulative transaction amount of acquisitions and disposals (cumulative acquisitions and disposals, respectively) of properties or related right-of-use assets thereof in the same development project within the preceding year.
(4) 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 preceding paragraph refers to the year preceding the date of occurrence of the current transaction. Items duly announced in accordance with these Regulations need not be counted toward the transaction amount.

8.13.2 Conditions publicly announced and declared transactions must re-undertake public disclosure and declaration:

If any of the following conditions relating to the Company’s transactions required to make public disclosure and declaration as prescribed in Article 8.13.1, the relevant information shall be declared and reported on the website designated by the securities competent authority within two days from the date of occurrence:

(1) Change, termination, or rescission of a contract signed in regard to the original transaction.
(2) The merger, demerger, acquisition, or transfer of shares is not completed by the scheduled date set forth in the contract.
(3) Change to the originally publicly announced and reported information.
8.13.3 Monthly reporting of derivatives trading:

111

The Company shall compile monthly reports on the status of derivatives trading engaged in up to the end of the preceding month by the Company and any subsidiaries that are not domestic public companies and enter the information in the prescribed format into the information reporting website designated by the securities competent authority by the 10th day of each month.

8.13.4 When the Company at the time of public disclosure 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 counting inclusively from the date of knowledge of such error or omission.
8.13.5 The Company acquiring or disposing of assets shall keep all relevant contracts, meeting minutes, logbooks, appraisal reports and CPA, attorney, and securities underwriter opinions at the company, where they shall be retained for 5 years except where another act provides otherwise.
8.13.6 The Company shall publicly announce and report the transaction information in accordance with the information disclosure procedures above. The format for public disclosure shall follow the attachment of “Regulations Governing the Acquisition and Disposal of Assets by Public Companies” promulgated by the securities competent authority, or the prescribed format on the information reporting website designated by the securities competent authority.
8.14 For the control procedures or information disclosure regulations of acquisition or disposal of assets undertaken by subsidiary:
(1) If the subsidiary of the Company is a public company, it shall establish the “Regulations Governing the Acquisition and Disposal of Assets” in accordance with the “Regulations Governing the Acquisition and Disposal of Assets by Public Companies”. Subsequent to the approval of the Board of Directors of the subsidiary, the regulations shall be submitted to supervisors/independent directors and reported to the shareholders’ meeting for approval. The same applies for amendments to the regulations.
(2) If the subsidiary of the Company is not a public company, it shall establish the “Regulations Governing the Acquisition and Disposal of Assets” in accordance with the “Regulations Governing the Acquisition and Disposal of Assets by Public Companies”. Subsequent to the approval of the board of directors of the subsidiary, the regulations shall be submitted to supervisors/independent directors. The same applies for amendments to the regulations.
(3) If the subsidiary of the Company is not a public company, the Company shall publicly disclose and report the information on the acquisition and disposal of assets in accordance with the “Regulations Governing the Acquisition and Disposal of Assets by Public Companies” on behalf on the subsidiary. The “paid-in capital or total assets” in the “Regulations Governing the Acquisition and Disposal of Assets by Public Companies”, the “information disclosure” section refers to the paid-in capital or total assets of the parent company (the Company).
8.15 Penalty

In the event of an employee violating these Regulations, the undertaking unit shall report to the human resource department. In accordance with the relevant regulations of the Company, the appropriate penalty should be imposed according to the severity of the violation.

112

8.16 Implementation and amendments

These Regulations shall be implemented after being approved by the Audit Committee and Board of Directors, and submitted to the General Shareholders’ Meeting for approval. The same procedure shall be followed for amendments to these Regulations.

When these Procedures are submitted for discussion to the Board pursuant to the aforementioned provisions, the Board shall take into full consideration each Independent Director’s opinions. Any objections or

reservations regarding any matter expressed by an Independent Director shall be recorded in the minutes of the Board meeting.

For the establishment or amendments to Regulations Governing the Acquisition and Disposal of Assets, the approval of one-half or more of all audit committee members shall be obtained before the transactions are submitted to the Board for resolution.

The terms "all Audit Committee members" and "all Directors" in Paragraph 3 shall be counted as the actual number of persons currently holding those positions.

9.0 Appendix

Any other matters not set forth in the Regulations shall be dealt with in accordance with the applicable law, rules,

and regulations.

113

[Attachment 11]

HannsTouch Solution Incorporated

Actions of Directors for Himself or on Behalf of Another Person that is Within the Scope of the

Company's Business

List of Directors	Titles and positions of other entities held concurrently	Same or similar business projects as the Company
WeiHsin Ma	Director of United Integrated Services	CB01010 Mechanical Equipment Manufacturing CC01080 Electronics Components Manufacturing E601010 Electric Appliance Construction E602011 Refrigeration and Air Conditioning Engineering F113010 Wholesale of Machinery F113030 Wholesale of Precision Instruments F119010 Wholesale of Electronic Materials IG03010 Energy Technical Services ZZ99999 All business items that are not prohibited or restricted by law, except those that are subject to special approval.
	Chairperson of Yin Wang Investment Corporation Chairperson of Golden Apple Investment Corporation Director of Walsin Lihwa Corporation	ZZ99999 All business items that are not prohibited or restricted by law, except those that are subject to special approval.
Hua Li Investment Corporation Representative: YuChi Chiao	Chairperson of Hanns Prosper Investment Corporation Chairperson of Main Lu Catering Co., Ltd. Chairperson of Hannshine Investment Corporation Chairperson of Yueh Ma First Investment Corporation	ZZ99999 All business items that are not prohibited or restricted by law, except those that are subject to special approval.

114

[Attachment 12]

HannsTouch Solution Incorporated Rules and Procedures of Shareholder Meetings

Article 1 (Basis of enactment) To establish a strong governance system and sound supervisory capabilities for the Company’s shareholders’ meetings, and to strengthen management capabilities, these Rules and Procedures are adopted pursuant to Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies, Article 5. Article 2 The rules of procedures for the Company’s shareholders’ meetings, except as otherwise provided by the law and regulations, or the Articles of Incorporation, shall be provided in these Rules and Procedures. Article 3 (Convening shareholders’ meetings and shareholders’ meeting notice) Unless otherwise provided by the law and regulations, the Company’s shareholders’ meetings shall be convened by the Board of Directors. The Company shall prepare electronic versions of the annual shareholders’ meeting notice and proxy forms, and the origins of and explanatory materials relating to all proposals, including proposals for ratification, matters for deliberation, or the election or discharge of Directors, and upload them to the Market Observation Post System (MOPS) 30 days before the date of an annual shareholders’ meeting or 15 days before the date of an extraordinary shareholders’ meeting. The Company shall prepare electronic versions of the shareholders’ meeting agenda handbook and supplemental meeting materials and upload them to the MOPS 21 days before the annual shareholders’ meeting or 15 days before the date of the extraordinary shareholders’ meeting. The shareholders’ meeting agenda handbook and supplemental materials shall also be made available for the shareholders’ perusal at the Company and the professional shareholder services agent designated thereby, and 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 sent in electronic form. Matters provided in the Company Act, Article 172, Paragraph 5, Securities and Exchange Act, Article 261, 43-6 and Regulations Governing the Offering and Issuance of Securities by Securities Issuers, Article 56-1 and 60-2 shall be specified under the reasons for convening the shareholders’ meeting in the meeting notice. None of the above matters may be raised as an extraordinary motion. The reasons for convening the shareholders’ meeting have specified the election of Directors and Supervisors and their appointment date. After the election is concluded in the shareholders’ meeting, their appointment date shall not be changed via an extraordinary motion or other methods. A shareholder holding 1% or more of the total number of issued shares may submit to the Company a proposal for discussion at a regular shareholders’ meeting. Such proposals are limited to one item only, and no proposal containing more than one item will be included in the meeting agenda. If, however, the shareholder’s proposal concerns recommendation advocating for the Company to promote public interest or fulfill social responsibilities, the Board of Directors shall include such proposal in the agenda. Further, if the shareholder’s proposal concerns circumstances provided in the Company Act, Article 172-1,

115

Paragraph 4, the Board of Directors shall not include such proposal in the agenda.

Prior to the book closure date before a regular shareholders’ meeting is held, the Company shall publicly announce that it will receive shareholder proposals, the method of acceptance for written or electronic proposals, and the location and time period for their submission; the period for accepting the submission of shareholder proposals may not be less than 10 days.

The proposals submitted by shareholders are limited to 300 words. A proposal exceeding 300 words will not be included in the meeting agenda. The shareholder making the proposal shall be present in person or by proxy at the General Shareholders’ Meeting and take part in the discussion of the proposal. Prior to the date for issuance of a notice of a shareholders’ meeting, the Company shall inform the shareholders who submitted proposals of the proposal screening results and 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 excluding any shareholder proposals on the agenda. Article 4 (Attendance by proxy and authorization)

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 proxy's authorization. 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 five days before the date of the shareholders’ meeting. When duplicate proxy forms are delivered, the one received earliest shall prevail, unless a declaration is made to cancel the previous proxy appointment.

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 by written or electronic form, a written notice of proxy cancellation shall be submitted to the Company two business days before the meeting date. If the cancellation notice is submitted after that time, votes cast at the meeting by the proxy shall prevail.

Article 5 (Principles determining the time and place of a shareholders’ meeting ) The venue for a Shareholders’ Meeting shall be at 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. Full consideration shall be given to the opinions of the Independent Directors with respect to the place and time of the meeting. Article 6 (Preparation of documents such as the attendance book ) The Company shall specify in the notice of the shareholders’ meeting 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 definitively marked, and a sufficient number of suitable personnel assigned to handle the registrations.

Shareholders and their proxies (collectively hereafter, "shareholders") shall attend shareholders’ meetings based on attendance cards, sign-in cards, or other certificates of attendance. Solicitors soliciting proxy

116

forms shall also bring identification documents for verification.

The Company shall furnish the attending shareholders with an attendance book to sign in, or attending shareholders may hand in a sign-in card in lieu of signing in.

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 (including Independent Directors), pre-printed ballots shall also be furnished.

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 a proxy, it may designate only one person to represent it in the meeting.

Article 7

(The chairperson and non-voting participants of a shareholders’ meeting )

If the shareholders’ meeting is convened by the Board of Directors, the meeting shall be presided by the Chairperson of the Board. When the Chairperson of the Board is on leave or for any reason unable to exercise the powers of the Chairperson, the Vice Chairperson shall act in place of the Chairperson; if there is no Vice Chairperson or the Vice Chairperson also is on leave or for any reason unable to exercise the powers of the Vice Chairperson, the Chairperson shall appoint one of the Managing Directors to act as the chairperson to preside at the meeting, or, if there are no Managing Directors, one of the Directors shall be appointed to act as chairperson. Where the Chairperson does not make such a designation, the Managing Directors or the Directors shall select one person among themselves to serve as chairperson to preside at the meeting.

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

It is advisable that shareholders’ meetings convened by the Board of Directors are attended by a majority of the Directors.

If a shareholders’ meeting is convened by a party with the power to convene but other than the Board of Directors, the convening party shall preside at the meeting. When there are two or more such convening parties, they shall mutually select a chairperson among themselves.

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

Article 8 (Documentation of a shareholders’ meeting by audio or video recording)

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 audio and visual records of the preceding paragraph shall be retained in proper custody for at least one year. If, however, a shareholder files a lawsuit pursuant to the Company Act, Article 189, the ballots shall be retained until the litigation concludes.

117

Article	9	(Computation of the number of shares in attendance and convening the meeting)
		Attendance at shareholders’ meetings shall be calculated based on the number of shares. The number of
		shares in attendance shall be calculated according to the shares indicated by the attendance book and
		sign-in cards handed in, plus the number of shares whose voting rights are exercised by written or
		electronic form.
		The chairperson shall call the meeting to order at the appointed meeting time and announce the number
		of shares without voting rights, shares present, and other relevant information. However, when the
		attending shareholders do not represent a majority of the total number of issued shares, the chairperson
		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
		chairperson 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 the Company Act, Article 175, Paragraph 1; all shareholders shall
		be notified of the tentative resolution, and another shareholders’ meeting shall be convened within 1
		month.
		When, prior to the meeting's conclusion, the attending shareholders represent a majority of the total
		number of issued shares, the chairperson may resubmit the tentative resolution for a vote by the
		shareholders’ meeting pursuant to the Company Act, Article 174.
Article	10	(Discussion of proposals)
		If the shareholders’ meeting is convened by the Board of Directors, the meeting agenda shall be set by the
		Board of Directors. The proposals (including extraordinary motions and amendments to original
		proposals) shall be voted on one by one. 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 with the power to convene that is not the Board of Directors.
		The chairperson 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 chairperson declares the meeting adjourned in violation of the Rules
		and Procedures, the other members of the Board of Directors shall promptly assist the attending
		shareholders in electing a new chairperson in accordance with the statutory procedures, by agreement of
		a majority of the votes represented by the attending shareholders, and then continue the meeting.
		The chairperson shall allow ample opportunity during the meeting for explanation and discussion of
		proposals and amendments or extraordinary motions put forward by the shareholders; when the
		chairperson is of the opinion that a proposal has been discussed sufficiently to put it to a vote, the
		chairperson may announce the discussion closed, call for a vote and arrange for sufficient time for the
		voting.

118

Article	11	(Shareholder speech)
		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 chairperson.
		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 speech's content does not correspond to the subject given on the
		speaker's slip, the spoken content shall prevail.
		Except with the chairperson's consent, 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 chairperson may suspend the speech.
		When an attending shareholder is speaking, other shareholders may not speak or interrupt unless they
		have sought and obtained the chairperson's consent and the shareholder that has the floor; the chairperson
		shall stop any violation.
		When a corporate shareholder appoints two or more representatives to attend a shareholders’ meeting,
		only one of the representatives appointed may speak on the same proposal.
		After an attending shareholder has spoken, the chairperson may respond in person or direct relevant
		personnel to respond.
Article	12	(Calculation of voting shares and recusal system)
		Voting at shareholders’ meetings 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 Company's interests, that shareholder may not vote on that item
		and may not exercise voting rights as a proxy for any other shareholder.
		The number of shares for which voting rights may not be exercised under the preceding paragraph shall
		not be calculated as part of the voting rights represented by attending shareholders.
		With the exception of a trust enterprise or a shareholder services agent approved by the competent
		securities authority, when one person is concurrently appointed as a proxy by two or more shareholders,
		the voting rights represented by that proxy may not exceed 3% of the voting rights represented by the
		total number of issued shares. If that percentage is exceeded, the voting rights in excess of that
		percentage shall not be included in the calculation.
Article	13	(Voting, monitoring and supervision of voting)
		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 the Company Act, Article 179, paragraph 2. Pursuant to
		the Company Act, Article 197-1, when a Director creates a pledge on the Company’s shares he or she
		holds, and the shares on pledge exceed 50% of the total shares held by the Director at the time of his or
		her appointment, the amount of shares exceeded shall not be counted as part of the voting rights
		represented by attending shareholders.

119

When the Company holds a shareholders’ meeting, it may allow the shareholders to exercise voting rights by written or electronic means; when voting rights are exercised by written or electronic means, the method of exercise shall be specified in the shareholders’ meeting notice. A shareholder exercising voting rights by written or electronic means will be deemed to have attended the meeting in person, but to have waived his/her rights with respect to the extraordinary motions and amendments to original proposals of that meeting; therefore, it is advisable that the Company avoid the submission of extraordinary motions and amendments to original proposals.

A shareholder intending to exercise voting rights by written or electronic means under the preceding paragraph shall deliver a written declaration of intent to the Company two days before the date of the shareholders’ meeting. When duplicate declarations of intent are delivered, the one received earliest shall prevail, except when a declaration is made to cancel the earlier declaration of intent.

After a shareholder has exercised voting rights by written or electronic means, in the event the shareholder intends to attend the shareholders’ meeting in person, a written declaration of intent to retract the voting rights already exercised under the preceding paragraph shall be made known to the Company two business days before the date of the shareholders’ meeting, by the same means by which the voting rights were exercised. If the notice of retraction is submitted after that time, the voting rights already exercised by written or electronic means shall prevail. When a shareholder has exercised voting rights both by written or electronic means and by appointing a proxy to attend a shareholders’ meeting, the voting rights exercised by the proxy in the meeting shall prevail.

Except as otherwise provided in the Company Act and the Company’s Articles of Incorporation, the passage of a proposal shall require an affirmative vote by a majority of the voting rights represented by the attending shareholders. At the time of a vote, for each proposal, the chairperson or a person designated by the chairperson shall first announce the total number of voting rights represented by the attending shareholders, followed by a poll of the shareholders. After the meeting's conclusion, 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 chairperson 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.

Vote monitoring and counting personnel for the voting on proposals shall be appointed by the chairperson, provided that all monitoring personnel shall be shareholders of the Company.

Vote counting for shareholders’ meeting proposals or elections shall be conducted publicly at the venue of the shareholders’ meeting. Immediately after vote counting is concluded, the voting results, including the statistical tallies of the numbers of votes, shall be announced on the spot at the meeting, and a record made of the vote.

120

Article 14 (Election of Directors) The election of Directors at a shareholders’ meeting shall be held in accordance with the applicable election and appointment rules adopted by the Company. The voting results shall be announced on-site immediately, including the names of those elected as Directors and the numbers of votes they received, and the names of those not elected as Directors and the numbers of votes they received. The ballots for the election referred to in the preceding paragraph shall be sealed with the signatures of the vote monitoring personnel and kept in proper custody for at least one year. If, however, a shareholder files a lawsuit pursuant to the Company Act, Article 189, the ballots shall be retained until the litigation concludes. Article 15 (Meeting minutes and signing matters) 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 chairperson of the meeting and a copy shall be distributed to each shareholder within 20 days after the conclusion of the meeting. 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 venue of the meeting, the chairperson's full name, the methods by which resolutions were adopted, and a summary of the deliberations and their results. If the election of Directors is held, the minutes shall disclose the votes received by each candidate. The minutes shall be retained for the duration of the existence of the Company. Article 16 (Public disclosure ) 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. It 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 the applicable law or regulations, or under Taiwan Stock Exchange Corporation regulations, the Company shall upload the content of such resolution to the MOPS within the prescribed time period. Article 17 (Maintaining order at the meeting place) Staff handling administrative affairs of a shareholders’ meeting shall wear identification cards or armbands. The chairperson 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 equipment prepared by the Company, the chairperson may intervene and prevent the shareholder from so doing.

121

When a shareholder violates the Rules and Procedures and defies the chairperson's instruction, obstructing the proceedings and refusing to heed calls to stop, the Chairperson may direct the proctors or security personnel to escort the shareholder from the meeting.

Article 18 (Recess and resumption of shareholders’ meeting) When a meeting is in progress, the chairperson may announce a break based on time considerations. If a force majeure event occurs, the chairperson 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 defer or resume the meeting within 5 days in accordance with the Company Act, Article 182.

Article 19 These Rules and Procedures, and any amendments hereto, shall be implemented after approval by a shareholders’ meeting.

122

[Attachment 13]

HannsTouch Solution Incorporated

Shareholdings of Directors and Independent Directors

I. The paid-up capital of the Company amounts to NT$8,069,485,290, and the issued stocks amount to 806,948,529 shares. Pursuant to the Securities and Exchange Act, Article 26, Paragraph 2 and the Rules and Review Procedures for Director and Supervisor Share Ownership Ratios at Public Companies, the minimum shares held by the Directors collectively amount to 25,822,352 shares.

II. As at March 26, 2022, the book closure date before the Annual General Shareholders’ Meeting, the shareholding of Directors and Independent Directors collectively amounts to 64,438,609 shares, or 7.99%% over the total number of shares. The shareholding of individual Directors is as follows:

		Shares held	Shareholding
Title	Name
		(shares)	percentage %

Chairman	WeiHsin, Ma	4,998,825	0.62%
Director	HUALI Investment Corp. Representative: YuChi, Chiao	59,439,784	7.37%
Director	TsuKang, Yu	-	-
Director	ChihChung, Chou	-	-
Independent Director	TienShang, Chang	-	-
Independent Director	TingWong, Cheng	-	-
Independent Director	JinFu, Chang	-	-

Note 1: Pursuant to the Rules and Review Procedures for Director and Supervisor Share Ownership Ratios at Public

Companies, Article 2: “if a public company has elected two or more independent directors, the share ownership figures calculated at the rates set forth in the preceding paragraph for all directors and supervisors other than the independent directors and shall be decreased by 20 percent.”

Note 2: The Company has established the Audit Committee in accordance with the law and regulations. As such, the

regulation governing the shareholding of the Supervisor is not applicable.

123

AI assistant

HannsTouch — AGM Information 2022

52281_rns_2022-06-02_eb668546-8c3e-4258-a9b7-a37e22a295ae.pdf

HannsTouch Solution Incorporated

2022 Annual General Shareholders’ Meeting Meeting Handbook

Table of Contents

HannsTouch Solution Incorporated

Meeting Procedure and Agenda of 2022 Annual General Shareholders’ Meeting

[Report Items]

V. Status Report on Offering of Unsecured Ordinary Corporate Bonds.

VI. Other report items:

[Ratification and Discussion Items]

Proposal 2: Proposed by the Board of Directors

Item: Ratification for earnings distribution for 2021.

HannsTouch Solution Incorporated Earnings Distribution Table

Proposal 4: Proposed by the Board of Directors

Proposal 5: Proposed by the Board of Directors

Proposal 6: Proposed by the Board of Directors

[Extraordinary Motions]

[Adjournment]

[Attachment 1]

HannsTouch Solution Incorporated

Business Report for 2021

(III) Research and development:

II. Summary of 2022 business plan

(I) Operational guidelines:

HannsTouch Solution Incorporated

INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE

Opinion

Basis for opinion

Key audit matters

Key Audit Matter – Appropriateness of cut-off of overseas warehouse operating revenue

Description

How our audit addressed the matter:

Key audit matter- Impairment assessment on property, plant and equipment

Description

How our audit addressed the matter:

Other matter – Parent company only financial reports

Responsibilities of management and those charged with governance for the consolidated financial statements

Auditors’ responsibilities for the audit of the consolidated financial statements

HANNSTOUCH SOLUTION INCORPORATED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

DECEMBER 31, 2021 AND 2020

HANNSTOUCH SOLUTION INCORPORATED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

DECEMBER 31, 2021 AND 2020

HANNSTOUCH SOLUTION INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

YEARS ENDED DECEMBER 31, 2021 AND 2020

HANNSTOUCH SOLUTION INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY YEARS ENDED DECEMBER 31, 2021 AND 2020

HANNSTOUCH SOLUTION INCORPORATED AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2021 AND 2020

HANNSTOUCH SOLUTION INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2021 AND 2020

INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE

Opinion

Basis for opinion

Key audit matters

Key Audit Matter –Appropriateness of cut-off of overseas warehouse operating revenue

Description

How our audit addressed the matter:

Key audit matter- Impairment assessment on investment property

(I) Description

(II) How our audit addressed the matter:

Responsibilities of management and those charged with governance for the parent company only financial statements

Auditors’ responsibilities for the audit of the parent company only financial statements

For and on Behalf of PricewaterhouseCoopers, Taiwan

April 11, 2022

HANNSTOUCH SOLUTION INCORPORATED PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2021 AND 2020

HANNSTOUCH SOLUTION INCORPORATED PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2021 AND 2020

HANNSTOUCH SOLUTION INCORPORATED

PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME YEARS ENDED DECEMBER 31, 2021 AND 2020

HANNSTOUCH SOLUTION INCORPORATED

PARENT COMPANY ONLY STATEMENTS OF CHANGES IN EQUITY YEARS ENDED DECEMBER 31, 2021 AND 2020

HANNSTOUCH SOLUTION INCORPORATED

PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2021 AND 2020

HANNSTOUCH SOLUTION INCORPORATED

PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2021 AND 2020

HannsTouch Solution Incorporated

Audit Committee’s Review Report

HannsTouch AGM Information 2022