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HG AGM Information 2021

Nov 11, 2021

52182_rns_2021-11-11_1fe936b0-fbcf-49a9-a8ea-eccf7e753904.pdf

AGM Information

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【Stock code：2702】

==> picture [159 x 95] intentionally omitted <==

Hotel Holiday Garden

Handbook for 2021 Annual meeting of shareholders

Time: June 16,2021 Venue:No. 279, Liuhe 2nd Road, Kaohsiung City (Forests Dynasty Room)

Table of Content

  1. Meeting procedures……..……………..……………………………………..... 1 2 . Meeting agenda………………………..……………………………………. 2 3. Management presentations………………………………………………….. 3 4. Acknowledgments…………………………………………………………. 11 5. Discussion……………………………………………………………… 11 6. Questions and motions……………………………………………………... 12 7. Adjournment……………………………………………………………….. 12 Attachments: 1.The audit report and financial statement of 2020 by the accountant………………….13 2.The audit report and consolidated financial statements of 2020 by the accountant .............24 3.Deficit Compensation Table……….…………………………...…………………..……...35 4.Amendments to the company's ethical behavior criteria…………………36 5.Amendment provisions of Procedure for Board of Directors Meetings……..……….…37 6.Amendment provisions of procedures for Election of Directors…………………………46 7.Amendment provisions of Procedure for Shareholders Meetings………………….50 8.Amendment provisions of Regulations Governing Loaning of Funds………...…………62 Appendices ： 1.Current Shareholding of Directors…….…………………............................63 2. Description of other matters…………………………………………………….……….64 3.The company's ethical behavior criteria……………………………………………65 4. Regulations Governing Procedure for Board of Directors Meetings……………………69 5. Procedures for Election of Directors………………………………………….……………77 6. Rules of Procedures for Shareholder Meetings………………………………….………84 7.Regulations Governing Loaning of Funds…………………………………...……………..85

  2. 0 -

Hotel Holiday Garden

The 2021Annual Meeting of Shareholders

1.Meeting procedures

2.Call the meeting to order

3.Speech by the Chairman

4.Management Presentation

5.Proposals

6.Discussion

7.Questions and motions

8.Adjournment

  • 1 -

Hotel Holiday Garden

The 2021Annual Meeting of Shareholders

2.Meeting agenda

Time ： June 16,2021 （ Wednesday ） 09:00

Place: Forests Dynasty Room, 1st Floor, No. 279, Liuho 2nd Road, Kaohsiung City

1.Call the meeting to order

2.Speech by the Chairman

3.Management presentations

  • (1) 2020 Business Report

  • (2) Report on the 2020 Financial Statements

  • (3) The 2020 Employees’ bonus and directors’ remuneration report

  • (4) Amendments to the company's ethical behavior criteria.

  • (5) Report on the handling of shareholders' proposals.

  • (6) Amendments to the company's rules of procedure.

  • (7) A subsidiary of HOLIDAY GARDEN U.S., reports on the improvement of

  • the excess balance of funds lent to others.

4.Acknowledgments

  • (1) Adoption of the 2020 Business Report and Financial Statements

  • (2) Adoption of the Proposal for Distribution of 2020 Profits and loss.

5.Discussions

  • (1) Amendment to the selection process of directors.

  • (2) Amendment to the Rules of Procedure for Shareholder Meetings.

  • (3) Amendment provisions of Regulations Governing Loaning of Funds.

  • (4) Kaohsiung City, the former gold district after the gold section of the real estate disposal case.

6.Proposals and motions

7.Adjournment

  • 2 -

3. Management Presentations

Report No.1: The 2020 Business report Explanation: Please refer to pages 5-9 of this handbook

。 Report No. 2:Audit committee ’s Review Report on the 2020 Financial Statements Explanation: Audit committee’s Review Report on the 2020 Financial Statements, please refer to page 10 of this handbook

Report No.3:The distribution of remuneration of the employees and directors.

  • Explanation:1.The estimated amount of employees' compensation and directors' compensation for the year ended December 31, 2020 was 0. Employees' compensation and directors' compensation are not intended to be distributed.

  • 2.Proposal is passed by the Board, and according to the law,the case is reported at the meeting of shareholders, and the procedures of distribution is assigned to the Chairman.

Report No. 4: Amendments to the Company's " Ethical behavior criteria ".

  • Explanation: The"Standards of Ethical Conduct" are proposed to be partially revised to conform to the amendments to the Act. Please refer to page 36 of this manual. (Annex IV)

Report No. 5: Report on proposals made by shareholders

  • Explanation: During the fixed period of April 12 to April 22, 2021 allocated for shareholders with more than 1% shares to make proposals,but none has been raised during this period. Please refer to page 64 of this handbook.

  • Report No.6: Amendments to the Company's "Regulations Governing Board Meetings".

  • Explanation: For the proposed new " Regulations Governing Procedure for Board of Directors Meetings" to comply with the amendment of the Act. Please refer to page 37 to 45 of this handbook. (Annex V)

  • Report No.7: HOLIDAY GARDEN U.S., a subsidiary of HOLIDAY GARDEN U.S., reports on the improvement of the excess balance of funds lent to others.

  • Explanation: 1.In accordance with the Financial Supervisory Commission's letter No. 1100340238 dated April 22, 2021.

  • The Company's overseas subsidiary, HOLIDAY GARDEN U.S., loaned funds to four overseas subsidiaries, including HOLIDAY

  • 3 -

GARDEN NW Corp, VC Corp, WC Corp and EV Corp, which are 100% owned by the Company, in excess of the aggregate amount in December 2009, in violation of Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies.

  1. In accordance with the letter No. 1100340238 dated April 22, 2021, the Company announced the improvement plan and the implementation status, and reported the implementation status in the shareholders' meeting.

  2. We have exceeded our capital borrowing limit due to the decrease in net assets of our subsidiary, HOLIDAY GARDEN U.S., in the fourth quarter of 2020. We will consider the impact of the change in net assets on the capital borrowing limit, propose an improvement plan and implement it, and report on the implementation at the shareholders' meeting.

  3. (1) Reduced quotas for Holiday Garden EV Corp.

  4. (2) The Board of Directors resolved to approve the submission of 110.6.16 to the General Meeting of Shareholders for approval to revise the limits of borrowing of funds for individuals and to others, taking into account the impact of changes in net assets on the limits of borrowing of funds.

  5. (3) We will continue to track and report to the Audit Committee and the Board of Directors on a quarterly basis to track improvements.

  6. 4 -

Hotel Holiday Garden Business report

Dear ladies and gentlemen:

Thank you for participating in the 2021annual meeting of the shareholders, and thank you for your support and trust in the company.

Under the great impact on the environment and keen competition, we thank all the directors and all the staff for their concerted efforts. Thank you for your hard work. This year, the company will continue to adhere to high service quality, improve software and hardware facilities, actively promotes various marketing activities, and develops diversified products through various sales channels to deepen and develop markets to create better performance.

Our current five hotel operations in the U.S. are not doing so well due to the general environment and the new coronavirus. Together with our executives, we will continue to work with all of our employees in the hope that we can weather the impact of this outbreak together and generate more profits for our shareholders.

  • 5 -

1.Business results

(1) Guest rooms

The room department received 89,363 passengers from January to December of 2020, compared the same period in 2019, a decrease of 64,189 from 153,552,a decline rate 41.80%;The Taiwanese accounted for 83.48% of all the guests, and guests from China accounted for 0.95%,guests from other regions accounted for 15.57%,Room occupancy rate is 38%,the revenue from room department is NT 62,141 thousand dollars, compared to the same period in 2019,NT107,910 thousand dollars,a decline of NT 45,769 thousand dollars, the decline was 42.41%.

(2) Food and beverage

The revenue from the food and beverage department for January to December 2020 was NT 33,726 thousand dollars, compared to the same period in 2019, NT 45,747 thousand dollar, a decline of 12,021 thousand dollars, a decline of 26.28%.

(3) Subsidiary

  1. The revenue from the guest room of the US subsidiary for January to December, 2020 was US 20,740 thousand dollars, compared to the same period in 2019, US 43,051 thousand dollars, a decline of US 22,311 thousand dollars, a decline of 51.82%.

  2. The revenue received from January to December, 2020 from Hua Yuan Development, the subsidiary in Taiwan, was NT 32,970 thousand dollars,compared to the same period in 2019,NT35,886 thousand dollars,the decline of NT2,916 thousand dollars,the decline of 8.13%.

  3. (4) The Group

The consolidated business revenue was NT741,703 thousand dollars, compared to the same period in 2019, NT1,520,242 thousands dollars, a decline of NT778,539 thousand dollars, a decline of 51.21%.

  • 6 -

2. Consolidated financial statements

(1) The net asset liabilities

As of December 31, 2020, the total assets of the Group were NT7,032,760 thousand dollars, out of which the total liabilities is 6,070,809 thousand dollars, accounted for 86.32%, the total net worth is 961,951 thousand dollars, which accounted for 13.68% of the total assets.

(2) Profits and losses:

The revenue received for the period of January to December, 2020 was NT741,703 thousand dollars, compared to the same period in 2019, NT1,520,242 thousand dollars, a decline of NT778,539 thousand dollars,a decrease of 51.21%. The operation cost was NT228,018 thousand dollars,operation expenses of NT713,111 thousand dollars, operating loss of NT199,426 thousand dollars. The net income from non-operating activities and expenses was NT294,434 thousand dollars, and the net loss before tax for the period was NT493,860 thousand dollars compared to the same period in 2019, NT28,292 thousand dollars, a decline of NT522,152 thousand dollars, decline by 1,845.58 % .

3. Budget and execution

The annual operating income in 2020 was NT741,703 thousand dollars, and the budget being NT1,670,217 thousand dollars, an non-achievement rate of 44.41%; the net loss before tax is NT493,860 thousand dollars,budget net profit before tax being NT171,080 thousand dollars, an non-achievement of 74.27%.

7

4. Analysis of Financial revenue and profitability

Unit: NT thousand dollars

The year
Items analyzed		 The year
Items analyzed		 The year
Items analyzed		 2020 2019
Financial
Revenue
and expense		 Net operating revenue 741,703 1,520,242
Gross profit 513,685 1,287,691
Net profit (207,309) (4,692)
Profitability Return of assets(%) (5.21) 2.28
Return of equity (%) (24.01) (0.36)
Operating Income to
Capital Stock to pre-tax
income to capital(%)		 Operating
profit		 (18.05) 19.88
Income
before tax		 (44.70) 2.56
Net profit margin(%) (36.44) (0.31)
Earnings per share (dollar) (2.45) (0.04)

5.Status of R&D: Not applicable

6. Summary of business plan for the current year

  • (1) Annual business policy

  • 1.Affordable food, and changes the image of the existing guest rooms

  • Cultivate marketing talents and increase exposure

  • Expand the company's business and develop new customers.

  • 4.Expand the overseas revenues,and flexible allocation of funds to stabilize the financial structure of the company.

  • 。

    1. Changes mode of purchase, reduction of operation cost

8

  • (2) Important sales strategy and future development strategy

    1. To establish a talent cultivation system and to improve the quality of service.

    2. In response to the continuous increasing international customers, the quality of catering services is to be raised to attract consumer groups, so as to increase the income sources of the company.

    3. Upgrade the existing rooms with advanced facilities and services, and expand business clients.

    4. Use on-line marketing to enhance advertising efficiency.

  • (3) Influenced by external competitive environment, regulations,overall business environment and COVID-19.

  • Considering the tourism market in 2020 , it is expected that the overall tourism industry will be very tough. The company upholds the principle of pragmatic stability and continuously adjust the business policy to respond to future market demand.

Chairperson of the Board: Chen Hai-ni Manager: Chen Hai-ni Accounting Director: Yu Su-ling

9

Hotel Holiday Garden

Audit Report from the Auditing Committee

The Board is expected to send the 2020 company's annual business report including the individual financial report, the consolidated financial report, and the proposal of surplus distribution. Upon the inspection of the Audit Committee, and no discrepancy found, and the report is prepared according to Article 14-4 of the Securities & Exchange Act and Article 219 of the Company Act, the aforementioned financial statements and documents are fairly presented as stated.

Regards

The 2021 Annual Meeting of Shareholders of Hotel Holiday Garden

Auditing Committee

GUO-YIN LU, Convener

March 24,2021

10

4.Proposals

Report No.1: (proposed by the Board)

Proposal: To acknowledge the company's 2020 financial statements

  • Explanation: The 2020 company’s personal financial report and consolidated financial report were completed by Wu,Chien-chih and Wang,Kuo-hua,accountant of PricewaterhouseCoopers Taiwan, who verified the reports.The business report is also completed and verified by the Audit Committee.Please refer to page 13-34 of the handbook.(Attachment 1 and 2). There is no discrepancy,and a verification report is issued.

Resolution:

Report No. 2 : (proposed by the Board)

Proposal: Adoption of the Proposal for Distribution of 2020 profits and losses.

Explanation:The distribution table of 2020 profits and losses are completed and approved

by the Auditing Committee, the distribution is as attached. Please refer to page 35 of this handbook(Attachment 3).

Resolution:

5. Discussion

Report No.1: (proposed by the Board)

  • Proposal ： Amendment to the Procedures for Election of Directors，Please proceed to discuss. Explanation: ： In order to conform to the amendments to related laws, the company hereby proposes to amend the Procedures for Election of Directors. Please refer to pages 46-49 of the handbook (Attachment 6)

Report No.2: (proposed by the Board)

  • Proposal ： Amendment to the Rules of Procedures for Shareholder Meetings，Please proceed to discuss.

  • Explanation: ： In order to conform to the amendments to related laws, the company hereby proposes to amend the Rules of Procedures for Shareholder Meetings. Please refer to pages 50-61 of the handbook (Attachment 7) 

~11~

  • Report No.3: (proposed by the Board)

  • Proposal ： Amendment to the Regulations Governing Loaning of Funds，Please proceed to discuss.

  • Explanation: ： In order to conform to the amendments to related laws, the company hereby proposes to amend the Regulations Governing Loaning of Funds. Please refer to pages 62 of the handbook (Attachment 8)

  • Report No.4: The real estate disposal case in the back section of Kaohsiung City's Qianjin District is submitted for discussion.

  • Explanation: (1) The Company intends to revitalize its assets and reduce liabilities in order to improve its financial structure and enhance long-term working capital in order to achieve the goal of maximizing shareholders' equity, and intends to dispose of the land and buildings in the Houjin section of the Qianjin District of Kaohsiung City at an appropriate price depending on its operating conditions.

  • (2) The Company commissioned China Real Estate Appraisal Firm and Jinmao Real Estate Appraisal Firm to complete the appraisal, which amounted to $2,347,453,921 and $2,446,509,019, respectively.

  • (3) After the approval of the shareholders' meeting, the Company authorized the Chairman to select a suitable buyer based on market conditions and the appraiser's appraisal report, with the total transaction amount not less than NT2.4 billion, and to operate and execute the contract in accordance with the Regulations Governing the Acquisition and Disposal of Assets by Public Companies.

  • (4) For matters not yet completed, we intend to authorize the chairman of the board of directors to act in accordance with the relevant laws and regulations.

6. Questions and motions

7. Adjournment

~12~

Attachment 1

The accountant's audit report and the financial statement of 2020 The accountant’s audit report

For Hotel Holiday Garden

(2021) Financial Review No. 20004341

Audit opinion

The individual balance sheets of Hotel Holiday Garden for the years of 2020 and December 31, 2019,and the individual comprehensive income statements for the years for 2020 and January 1 to December 31, 2019, Statement of changes in equity, individual Statements of Cash Flows, and individual financial statement (including the summary of major accounting policies), have been checked by the accountant.

In accordance with the opinion of the accountant, the above individual financial statements are prepared in line with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, which is sufficient to express the 2020 and December 31, 2019 individual financial status of Hotel Holiday Garden, and the 2020 and January 1 to December 31, 2019 individual financial performance and individual cash flow .

The basis of check opinion

The audit is carried out in accordance with the rules governing “Auditing and Certifications of Financial Statements by Certified Public Accountants” and the generally accepted auditing standards of the Republic of China. The responsibility of the accountants under these standards will be further explained in the accountability section of the accountant's audit of individual financial statements. In accordance with the professional ethics of the CPA accountant, it has maintained its detached independence from Hotel Holiday Garden and fulfil other responsibilities. The accountant believes that sufficient and appropriate evidence of the audit has been obtained as a basis for expression of the opinion.

Checking of Key items

The auditing of key matters refer to the most important matters of the audit of the 2020 individual financial statements of Hotel Holiday Garden in accordance with the professional judgment of the accountant. These matters have been dealt with in the process of auditing the overall individual financial statements and forming a review opinion. The accountant will not make a separate opinion.

The key check items for the 2020 individual financial statements of Hotel Holiday Garden are as follows: 

~13~

Intangible assets impairment evaluation

Description

For accounting policies of investment using the equity method, please refer to Note 4(12) of the consolidated financial statements. For the uncertainty of the accounting estimates and assumptions of the investment impairment assessment using the equity method, please refer to appendice 5 (2) of the individual financial statements. For the description of the equity method investment, please refer to appendice 6 (4) of the individual financial statements.

The carrying amount of intangible assets and class of property, plant and equipment as of December 31, 2020 of the Group US subsidiary is NT$3,916,723,000, accounting for 56% of the total amount of the total consolidated assets. The booming of a wide variety of hotels and accommodations and the fierce competition in the hospitality industry in recent years And as a result of the impact of the COVID-19 pneumonia outbreak, the management of the Company has identified property, plant and equipment and intangible assets of certain subsidiaries as having indications of possible impairment. and to use the estimated future cash flows of each subsidiary and an appropriate discount rate for discounting to measure the recoverable amount of each cash generating unit and to use this information for evaluating the impairment of intangible assets.

The experts appointed by management measure the recoverable amounts of property, plant and equipment and intangible assets at fair value less costs of disposal. As the aforementioned estimation of future cash flows and the appraisal report issued by the experts involve a number of assumptions that could result in a material impact on the measurement of recoverable amount, therefore, intangible asset impairment evaluation is chosen to be one of the key audit matter of this year.

Corresponding audit program

We have implemented the following audit program corresponding to the aforementioned audit matter:

  • 1.We have learned to understand and evaluate management's operating procedure for estimating the subsidiaries’ future cash flows and verified that their cash flows are consistent with the business plan approved by the Board of Directors.

  • 2.Evaluate the reasonableness of key assumptions used by management to estimate future cash flows. 

~14~

  • 3.We also evaluated the reasonableness by comparing the parameter and the discount rate of the recoverable amount.

  • 4.Obtain an appraisal report from an expert appointed by management and evaluate the independence, professional competence and suitability of the expert.

  • 5.Review the contents of the appraisal report to understand and assess the reasonableness of the sources of information, evaluation methods and conclusions used in the expert's report.

Responsibility of management and governing units regarding the consolidated financial statements

The management's responsibilities are based on the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” and maintain the necessary internal controls relating to the preparation of the individual financial statements to ensure that there are no significant misrepresentations of fraud or errors in the individual financial statement.

In the preparation of the consolidated financial statements, the management's responsibilities also including assessment of the ability of the Hotel Holiday Garden to continue its operations, the disclosure of related matters, and the adoption of the accounting basis for its continuing operation, unless the management intends to liquidate the Hotel Holiday Garden or cease its operations, or if there is no other options that are practical or feasible, but to liquidate or cease its operations.~19~

Those charged with governance(including the Supervisor) of Hotel Holiday Garden are responsible for overseeing the process of financial reporting.

The responsibility of the Accountant to audit the consolidated financial statements

The objectives of the Accountant auditing the consolidated financial statements are to obtain reasonable assurance about the financial statements as a whole are free from any material misrepresentation due to fraud or error and to issue an audit report. Reasonably assurance refers to a high level of assurance, but the verification work carried out in accordance with the generally accepted auditing standards of the Republic of China cannot guarantee that the significant misrepresentation of the consolidated financial statements can be detected. False expressions may be caused by fraud or errors. If the amount is misstated, individually or in aggregation, this would reasonably expected to affect the economic decision made by the consolidated financial statement users, and this will be considered to be significant impact. 

~15~

In accordance with the generally accepted auditing standards of the Republic of China, the Accountant exercised professional judgment and maintained professional skepticism. The accountant also performs the following tasks.

  • 1.We identified and assessed the significant misrepresentation of the consolidated financial statements due to fraud or error; designed and implemented appropriate response measures for the assessed risks and to obtain sufficient and appropriate evidence to check as the basis for the review. Because fraud may involve conspiracy, forgery, intentional omission, false statement or overstepping internal control, the risk of significant misrepresentation due to fraud not being detected is higher than the cause of the error.

  • We obtained the necessary understanding of the internal control of the audit to design an appropriate check procedure at the time, but the purpose is not to express an opinion on the effectiveness of the internal control of the Hotel Holiday Garden.

  • Assessment of the appropriateness of accounting policies adopted, and the rationality of accounting estimates and related disclosures made by the management.

  • 4.Conclusions are drawn on the basis of audit evidence obtained, whether the management adopts the appropriateness of the basis of continuing operations accounting and whether there are significant uncertainties in the events or circumstances that may cause significant doubts about the ability of the Hotel Holiday Garden to continue operation.

  • Evaluate the overall presentation, structure and contents of the consolidated financial statements (including related notes) and whether the individual financial statements represent the underlying transactions and events

  • Opinions expressed regarding the consolidated financial statements are based on sufficient and appropriate evidence obtained for the financial information of the entities of the Hotel Holiday Garden. The accountant is responsible for the guidance, supervision and execution of the audition and providing the audit opinions

Communication with those charged with governance regarding the planned scope and the timing of inspection, and major findings (including significant internal control shortcomings identified during the audit).

We have also provided those charged with governance the statement that the personnel of our accounting firm subject to the requirements of independence have complied with the requirements of independence of the code of professional ethics of certified public accountants of the Republic of China and communicate with those charged with governance relationships and other matters that may influence our independence (including related preventive measures). 

~16~

We described these matters in the accountant’s report, unless the laws and regulations prohibit such disclosure or under rare condition that we decide not to communicate a given matter because the negative impact from such communication may override its public benefits under reasonable assumption.

PwC Taiwan Wu,Chien-chih Independent accountant Wang,Kuo-hua

The committee of the Financial Supervisory Commission Approved Certificate Number:Financial Supervisory Commission Certificate No. 1030027246

Committee of the former Executive Yuan Financial and Supervisory Commission Approved certificate: (87) Taiwan Finance (VI) No. 68790 March 24, 2021 

~17~
Holiday Garden International Ltd. Holiday Garden International Ltd. Holiday Garden International Ltd. Holiday Garden International Ltd. Holiday Garden International Ltd.
Parent Company Only Balance Sheet
December 31 of 2020 and 2019
Unit: NT$1,000
D e c e m b e r 3 1 , 2 0 2 0 D e c e m b e r 3 1 , 2 0 1 9
Assets Notes A m
o		 u n
t		 % A m o u n
t		 %
Current assets
1100 Cash and cash equivalents 6(1) $ 60,874 2 $ 91,968 3
1136 Net notes receivable 8 973,505 31 998,986 29
1150 Net accounts receivable 6(2) - - 938 -
1170 Other accounts receivable 6(2) 4,099 - 6,428 -
1200 Tax assets 141 - 2,874 -
130X Advance payments 6(3) 925 - 993 -
1410 Other financial assets - current 2,586 - 2,306 -
1479 Other current assets - others 162 - 241 -
11XX Total current assets 1,042,292 33 1,104,734 32
Non-current assets
1550 Investments accounted for using the 6(4)
equity method 1,332,315 43 1,654,003 47
1600 Property, plants, and equipment 6(5) and 8 662,177 21 686,263 19
1755 Right-of-use asset 6(6) 3,396 - 1,957 -
1840 Deferred tax assets 6(21) 90,695 3 56,921 2
1920 Guarantee deposits paid 733 - 378 -
15XX Total non-current assets 2,089,316 67 2,399,522 68
1XXX Total Assets $ 3,131,608 100 $ 3,504,256 100

(Next page) 

~18~

Holiday Garden International Ltd. Parent Company Only Balance Sheet December 31 of 2020 and 2019

Liabilities and equity Unit: NT$1,000
D e c e m b e r 3 1 , 2 0 2 0
D e c e m b e r 3 1 , 2 0 1 9
Notes
A
m
o
u
n
t
%
A
m
o
u
n
t
%
6(7) and 8
$
1,609,599
51
$
1,530,000
44
6(8)
130,000
4
130,000
4
6(15)
8,506
-
8,196
-
-
-
322
-
3,140
-
2,519
-
15,183
1
15,663
-
66
-
1,370
-
1,287
-
586
-
6(9) and 8
18,597
1
52,196
2
2,667
-
2,529
-
1,789,045
57
1,743,381
50
6(9) and 8
13,948
-
56,010
1
6(21)
236,212
8
285,764
8
2,120
-
1,389
-
6(5)
127,577
4
127,577
4
755
-
870
-
380,612
12
471,610
13
2,169,657
69
2,214,991
63
6(11)(13)
1,104,856
35
1,104,856
32
6(12)

2,169
-
2,169
-
6(13)

82,561
3
82,561
2
71,161
2
71,161
2
(
182,800) (
6 )
87,509
3
6(14)
(
115,996) (
3) (
58,991) ( 2)
961,951
31
1,289,265
37
$
3,131,608
100 $
3,504,256
100
Current liabilities
2100
Short-term borrowings
2110
Short-term notes and bills payable
2130
Contractual liabilities - current
2150
Notes payable
2170
Accounts payable
2200
Other accounts payable
2230
Income tax liabilities
2280
Unearned receipts
2320
Long-term liabilities - current portion
2399
Other current liabilities - others
21XX
Total current liabilities
Non-current liabilities
2540
Long-term borrowings
2570
Deferred income tax liabilities
2580
Lease obligation -non current
2610
Long-term notes and accounts
payable
2645
Guarantee deposits received
25XX
Total non-current liabilities
2XXX
Total liabilities
Equity
Capital stock
3110
Common share capital
Capital surplus
3200
Capital surplus
Retained earnings
3310
Legal reserve
3320
Special reserve
3350
Retained earnings
Other equity
3400
Other equity
3XXX
Total equity
Major events after the reporting
period
3X2X
Total liabilities and equity		 
Please refer to notes of parent company only financial statements provided at the end, which is part of this parent
company only financial report.

Chairperson of the Board: Chen Hai-niManager: Chen Hai-niAccounting Director: Yu Su-ling

~19~
Holiday Garden International Ltd. Holiday Garden International Ltd. Holiday Garden International Ltd. Holiday Garden International Ltd. Holiday Garden International Ltd. Holiday Garden International Ltd.
Parent Company Only Statement of Comprehensive Income
January 1 to December 31 of 2020 and 2019
Unit: NT$1,000
(Except earnings (loss) per share, which is in NT$1.00)
2 0 2 0 2 0 1 9
Item Notes A m o u
n
t		 %
 A m o u n
t		 %
4000 Operating revenue 6(14) $ 95,867 100 $ 153,657 100
5000 Operating cost 6(3)(19)(20)
(		 41,621) ( 44) ( 51,762) ( 34)
5900 Operating gross profit 54,246 56 101,895 66
Operating expenses 6(19)(20)
6200 Management expense ( 94,578 ) ( 99) ( 106,647) ( 69)
6450 Expected credit impairment loss 12(2) ( 447) - ( 125) -
6000 Total operating expense ( 95,025) ( 99) ( 106,772) ( 69)
6900 Operating loss ( 40,779) ( 43) ( 4,877) ( 3)
Nonoperating income and
7100 Interest income 6(15) 12,381 13 21,077 14
7010 Other income 6(16)and7 13,178 14 3,078 2
7020 Other gains and losses 6(17) ( 52,755 ) ( 55) ( 31,595) ( 21)
7050 Financial cost 6(18) ( 21,832 ) ( 23) ( 21,375) ( 14)
7070 Share of profit or loss of 6(4) ( 250,432) ( 261) 34,605 23
7000 Total non-operating income ( 299,460) ( 312) 5,790 4
7900 Net profit (loss) before tax ( 340,239 ) ( 355) 913 1
7950 Income tax (expense) benefits 6(21) 69,930 73 ( 5,605) ( 4)
8200 Net profit (loss) ( $ 270,309) ( 282) ($ 4,692) ( 3)
Other comprehensive income
Items may be subsequently
8361 Exchange differences on 6(4) ( $ 71,256 )( 74) ($ 43,314) ( 28)
8399 Income tax of items that may be 6(21) 14,251 15 8,663 5
8300 Other comprehensive income ( $ 57,005) ( 59) ($ 34,651) ( 23)
8500 Total comprehensive income ( $ 327,314) ( 341) ($ 39,343) ( 26)
Earnings (loss) per share 6(22)
9750 Basic ( $ 2.45) ($ 0.04)
9850 dilution ( $ 2.45) ($ 0.04) 
Please refer to notes of parent company only financial statements provided at the end, which is part of this
parent company only financial report.

Chairperson of the Board: Chen Hai-ni Manager: Chen Hai-ni

Accounting Director : Yu Su-ling

~20~

Holiday Garden International Ltd.
Parent Company Only Statements of Changes in Equity
January 1 to December 31 of 2020 and 2019
2019 N o t e s
6(13)
6(13)		 Share capital -
c o m m o n s t o c k
$ 1,023,015
-
-
-
-
81,841
-
$ 1,104,856
$1,104,856
-
-
-
$ 1,104,856		 Additional paid In
c a p i t a l -
in excess of par
$2,169
-
-
-
-
-
-
$ 2,169
$2,169
-
-
-
$ 2,169		 R e
t
a
i
n		 e
d
e
a
r
n
i
n
g
s
p
e
c
i
a
l
e
s
e
r
v
e
R e t a i n e d
e a r n i n g s
$ 71,161
$ 215,768
-
(
4,692 )
-
-
-
(
4,692 )
-
(
21,266 )
-
(
81,841 )
-
(
20,460 )
$ 71,161
$ 87,509
$71,161
$87,509
-
(
270,309 )
-
-
-
(
270,309 )
$71,161
($ 182,800 )		 Unit: NT$1,000
E x c h a n g e
d i f f e r e n c e s
on translation
o f f o r e i g n
f i n a n c i a l
s t a t e m e n t s T
o
t
a
l
( $ 24,340 ) $ 1,349,068

- (
4,692 )
(
34,651 )(
34,651 )
( 34,651 )(
39,343 )

-
-

-
-

- (
20,460 )
( $ 58,991)$ 1,289,265
( $58,991 )
$1,289,265

- (
270,309 )
(
57,005 )(
57,005 )
(
57,005) (
327,314 )
($ 115,996 )$961,951		 Unit: NT$1,000
E x c h a n g e
d i f f e r e n c e s
on translation
o f f o r e i g n
f i n a n c i a l
s t a t e m e n t s T
o
t
a
l
( $ 24,340 ) $ 1,349,068

- (
4,692 )
(
34,651 )(
34,651 )
( 34,651 )(
39,343 )

-
-

-
-

- (
20,460 )
( $ 58,991)$ 1,289,265
( $58,991 )
$1,289,265

- (
270,309 )
(
57,005 )(
57,005 )
(
57,005) (
327,314 )
($ 115,996 )$961,951
L
r		 e
g
a
l
e
s
e
r
v
e
$ 61,295
-
-
-
21,266
-
-
$ 82,561
$82,561
-
-
-
$82,561		 S
r		 p
e
c
i
a
l
e
s
e
r
v
e
$ 71,161
-
-
-
-
-
-
$ 71,161
$71,161
-
-
-
$71,161
$ 1,349,068
(
4,692 )
(
34,651 )
(
39,343 )
-
-
(
20,460 )
$ 1,289,265

$1,289,265
(
270,309 )
(
57,005 )
(
327,314 )
$961,951
Balance, January 1, 2019
Net loss
Other comprehensive income
Total comprehensive income
2018 Appropriation and
distribution of retained earnings:
Legal reserve
Stock dividends
Cash dividends
Balance, December 31, 2019
2020
Balance, January 1, 2020
Net income
Other comprehensive income
Total comprehensive income
Balance, December 31, 2020		 
Please refer to notes of parent company only financial statements provided at the end, which is part of this parent company only financial report.

Chairperson of the Board: Chen Hai-ni

Manager: Chen Hai-ni Accounting Director: Yu Su-ling

~21~
Holiday Garden Hotel Co., Ltd. Garden Hotel Co., Ltd.
Parent Company Only Cash Flow Statement
January 1 to December 31 of 2020 and 2019
Unit: NT$1,000
Notes 2020 2019
Cash flows from operating activities
Net profit before tax ($ 340,239 ) $ 913
Adjustments:
Revenue/expenses
Provision for bad debt expense 12(2) 447 125
Depreciation expenses 6(5)(6)(19) 26,210 28,836
Profit on lease modification 6(6) ( 16) -
Interest expense 6(18) 21,832 21,375
Interest income 6(15) ( 12,381 ) ( 21,077 )
Share of profit of subsidiaries, associates, joint
 6(4)
ventures accounted for using equity method 250,432( 34,605 )
Loss on disposal and write-off of property,
 6(17)
plants, and equipment - ( 62 )
Changes in assets/liabilities related to operating
activities
Net changes in assets related to operating
activities
Notes receivable 938 ( 538 )
Accounts receivable 1882( 796 )
Inventories 68( 661 )
Advance payments ( 280) ( 118 )
Other current assets - others 79( 148 )
Net changes in liabilities related to operating
activities
Contractual liabilities - current 310 1,229
Notes payable ( 322) ( 1,044 )
Accounts payable 621( 2,922 )
Other accounts payable ( 726 ) 2,758
Unearned receipts 138 830
Operating cash inflows (outflows) ( 51,007 ) ( 5,905 )
Interests received 15,114 21,558
Interests paid ( 21,586 ) ( 21,387 )
Income taxes paid ( 449 ) ( 2,149 )
Net cash outflows from operating
activities ( 57,928) ( 7,883 )
Cash flows from investment activities
Acquired in amortised cost of a financial asset -( 409,760 )
Disposalin amortised cost of a financial asset 25,481 -
Acquisition of investments accounted for using the
 6(4)
equity method -( 400,000 )
Cash returned from capital reduction of investments
 6(4)
accounted for using the equity method - 605,915
Acquisition of property, plants, and equipment
 6(24) ( 1,599 ) ( 1,973 )
Disposal of property, plants, and equipment - 495
Increase (decrease) in guarantee deposits paid ( 355) 709
Net cash outflows from investmentactivities 23,527( 204,614 )
Cash flows from fundraising activities
Increase in short-term borrowings 6(25) 1,791,099 1,660,000
Decrease in short-term borrowings 6(25) ( 1,711,500 ) ( 1,334,500 )
Lease capital repayment 6(25) ( 516 ) ( 573 )
Long-term borrowings 6(25) - 20,000
Payments of long-term borrowings 6(25) ( 75,661 ) ( 51,086 )
Increase in guarantee deposits received ( 115 ) 115
Distribution of cash dividends 6(13) -( 20,460 )
Net cash inflows from fundraising
activities 3,307 273,496 
~22~
Holiday Garden Hotel Co., Ltd.
Parent Company Only Cash Flow Statement
January 1 to December 31 of 2019 and 2018
Notes
2020
Increase in cash and cash equivalents
(
31,094 )
Cash and cash equivalents, beginning of the period6(1)
91,968
Cash and cash equivalents, end of the period
6(1)
$
60,874		 Unit: NT$1,000
2019
60,999
30,969
$
91,968		 
Please refer to notes of parent company only financial statements provided at the end, which is part of this
parent company only financial report.。

Chairperson of the Board: Chen Hai-ni     Manager: Chen Hai-ni

Accounting Director : Yu Su-ling

~23~

Attachment 2

Independent auditor’s review report on the 2020 consolidated financial statements Independent accountant’s audit report

(2021) Tsai Shen Pao Tzu No. 20004468

For Hotel Holiday Garden

Opinion

We have audited the following financial statements of Hotel Holiday Garden and the subsidiaries (the “Group”): the consolidated balance sheets of December 31, 2019 and 2018, the consolidated statements of comprehensive income of January 1 to December 31 of 2019 and 2018, the consolidated statements of changes in equity, the consolidated statements of cash flows, and the notes to consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at December 31, 2019 and 2018 and its consolidated financial performance and its consolidated cash flows for the period from January 1 to December 31 of 2019 and 2018 of the Group in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and with the International Financial Standards (IFRs), the International Accounting Standards (IASs), and the related interpretations and interpretative bulletins endorsed by the Financial Supervisory Commission

Basis for opinion

The audit is carried out in accordance with the Regulations Governing the Auditing and Certification of Financial Statements by Certified Public Accountants and the generally recognized auditing standards of Republic of China. The responsibilities of the accountants under these standards will be further described in the responsibility section of the accountant's audit of the consolidated financial statements. The personnel of the accounting firm subject to the independent requirements have complied with the code of professional ethics of certified public accountants of the Republic of China, stayed fully independent of the Hotel Holiday Garden, and performed other responsibilities in accordance with the code

Audit of key matters

The key auditing matters, based on the professional judgment of the accountants, are the most important matters in the audit of the 2018 consolidated financial statement of Hotel Holiday Garden. These matters have been dealt with in the process of audition as a whole and a review opinion has been given. The accountant will not express a separate opinion on these matters.

The key audit matters of the consolidated financial statements of 2018 of the Group are determined as follows: 

~24~

Impairment assessment of property, plant and equipment and intangible assets

Explanation

For the accounting policy on impairment of non-financial assets, please refer to Note 4(17) of the consolidated financial statements. For the uncertainty of accounting estimates and assumptions for impairment assessment of real property, plant and equipment, and intangible assets, please refer to Note 5(2) of the consolidated financial statements. For the explanation of the accounting items for impairment of non-financial assets, please refer to Note 6(7) of the consolidated financial statements.

The carrying amount of intangible assets and class of property, plant and equipment as of December 31, 2020 of the Group US subsidiary is NT$3,916,723,000, accounting for 56% of the total amount of the total consolidated assets. The booming of a wide variety of hotels and accommodations and the fierce competition in the hospitality industry in recent years And as a result of the impact of the COVID-19 pneumonia outbreak, the management of the Company has identified property, plant and equipment and intangible assets of certain subsidiaries as having indications of possible impairment. and to use the estimated future cash flows of each subsidiary and an appropriate discount rate for discounting to measure the recoverable amount of each cash generating unit and to use this information for evaluating the impairment of intangible assets.

The experts appointed by management measure the recoverable amounts of property, plant and equipment and intangible assets at fair value less costs of disposal. As the aforementioned estimation of future cash flows and the appraisal report issued by the experts involve a number of assumptions that could result in a material impact on the measurement of recoverable amount, therefore, intangible asset impairment evaluation is chosen to be one of the key audit matter of this year.

Corresponding audit program

We have implemented the following audit program corresponding to the aforementioned audit matter:

  • 1.We have learned to understand and evaluate management's operating procedure for estimating the subsidiaries’ future cash flows and verified that their cash flows are consistent with the business plan approved by the Board of Directors. 
~25~

  • 2.Evaluate the reasonableness of key assumptions used by management to estimate future cash flows.

  • 3.We also evaluated the reasonableness by comparing the parameter and the discount rate of the recoverable amount.

  • 4.Obtain an appraisal report from an expert appointed by management and evaluate the independence, professional competence and suitability of the expert.

  • 5.Review the contents of the appraisal report to understand and assess the reasonableness of the sources of information, evaluation methods and conclusions used in the expert's report.

Other matters: Parent company only financial report

The Group has prepared the 2019 and 2018 parent company only financial statements, and we have issued an audit report with unmodified opinion. That report is available for reference.

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

The responsibilities of management is to prepare appropriately stated consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and with the International Financial Standards (IFRs), the international Accounting Standards (IASs), and the related interpretations and interpretative bulletins endorsed by the Financial Supervisory Commission of the Republic of China. Management is also responsible for maintaining necessary internal control relevant to the preparation of the consolidated financial statements to ensure that the consolidated financial statements are free from material misstatement by fraud or error.

Management when preparing consolidated financial statements is also responsible for evaluating the Group’s ability to continue as a going concern, disclosing relevant matters, and using the going concern basis of accounting unless management intends to liquidate the Group, to cease the operations, or to liquidate or to have no feasible alternatives but to do so.

Those charged with governance (including the supervisors) of Group are responsible for supervising the 

~26~

Group’s financial reporting procedure.

Account's responsibilities for the audit of consolidated financial statements

The objectives of the accountants for auditing the consolidated financial statements are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from any material misstatement due to fraud or errors and to issue an accountant’s report accordingly. Reasonable assurance refers to a high level of assurance, but there is no guarantee that an audit performed in accordance with the generally accepted auditing standards of the Republic of China can detect any material misstatement from the consolidated financial statements. Misstatements may arise from fraud or errors. A misstated dollar amount, individually or in the aggregate, that could be reasonable predicted to influence the economic decision of the user of the consolidated financial statements can be viewed as material.

In accordance with the generally accepted auditing standards of the Republic of China, we exercised professional judgment and maintained professional skepticism throughout the audit. We also performed the following tasks:

  • 1.We identified and assessed the risks of material misstatement of the consolidated financial statements, whether due to fraud or errors, designed and performed audit procedures according to those risks, and obtained audit evidence that can sufficiently and appropriately form the 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.

  • 2.We obtained an understanding of internal control relevant to the audit in order to design audit procedures suitable for the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.

3. We evaluated the appropriateness of accounting policies adopted and the reasonableness of accounting estimates and related disclosures made by management. 。

  • 4.We concluded on the appropriateness of management’s use of the going concern basis of accounting and 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 based on the audit evidence we have obtained. If we 
~27~

conclude that a material uncertainty exists, we will need to draw attention in our accountant’s report to the related disclosures in the consolidated financial statements or to modify our opinion if such disclosures are inadequate. Our conclusions are based on the audit evidence obtained up to the date of this accountant’s report. However, future events or conditions may cause the Group to cease to continue as a going concern.

  • 5.We evaluated the overall presentation, structure and content of the consolidated financial statements, including the attached notes, and whether the consolidated financial statements represent the underlying transactions and events in a fair manner.

  • 6.We obtained sufficient and appropriate audit evidence regarding the financial information of entities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision, and performance of group audits and are responsible for our audit opinion.

We have communicated with those charged with governance regarding the planned scope and the timing of the audit as well as material audit findings (including significant internal control shortcomings identified in the audit).

We determined the key audit matters of the consolidated financial statements of 2019 of the Group according to matters communicated with those charged with governance. We described these matters in the accountant’s report, unless the laws and regulations prohibit such disclosure or under rare condition that we decide not to communicate a given matter because the negative impact from such communication may override its public benefits under reasonable assumption.

PwC Taiwan Wu,Chien-chih Independent accountant Wang,Kuo-hua

The committee of the Financial Supervisory Commission Approved Certificate Number:Financial Supervisory Commission Certificate No. 1030027246

Committee of the former Executive Yuan Financial and Supervisory Commission Approved certificate: (87) Taiwan Finance (VI) No. 68790

March 24, 2021 

~28~

Holiday Garden International Ltd. and Subsidiaries Consolidated Balance Sheet December 31 of 2020 and 2019

Unit: NT$1,000 Unit: NT$1,000 Unit: NT$1,000
D e c e m b e r 3 1 2 0 2 0 D e c e m b e r 3 1 2 0 1 9
Assets Notes % Amount %
Amount
Current assets
1100 Cash and cash equivalents 6(1) $ 887,011 13 $ 1,139,837 15
1136 Financial assets available-for-sale - 8
current 973,505 14 998,986 13
1150 Net notes receivable 6(2) - - 1,438 -
1170 Net accounts receivable 6(2) 24,727 - 34,412 1
1200 Other accounts receivable 823 - 3,232 -
1220 Tax assets 69,938 1 25,283 -
130X Inventories 6(3) 1,029 - 1,096 -
1410 Advance payments 10,987 - 8,830 -
1479 Other current assets - others 194 - 292 -
11XX Total current assets 1,968,214 28 2,213,406 29
Non-current assets
1600 Property, plants, and equipment 6(4)(7)(25)及(8) 3,947,433 56 4,279,580 56
1755 Right if use asset 6(5) 112,412 2 118,349 2
1780 Intangible assets 6(6)(25) 664,991 9 750,664 10
1840 Deferred tax assets 6(23) 317,815 5 192,672 2
1915 Prepayments for equipment 11,663 - 83,278 1
1920 Guarantee deposits paid 10,040 - 8,273 -
1990 Other non-current assets - others 192 - 203 -
15XX Total non-current assets 5,064,546 72 5,433,019 71
1XXX Total assets $ 7,032,760 100 $ 7,646,425 100

(Next page) 

~29~

Holiday Garden International Ltd. and Subsidiaries Consolidated Balance Sheet

December 31 of 2020 and 2019
Unit: NT$1,000 Unit: NT$1,000 Unit: NT$1,000
D e c e m b e r 3 1 2 0 2 0 D e c e m b e r 3 1 2 0 1 9
Liabilities and equity Notes Amount % Amount %
Current liabilities
2100 Short-term borrowings 6(8)and 8 $ 1,609,599 23 $ 1,530,000 20
2110 Short-term notes and bills payable 6(9) 130,000 2 130,000 2
2130 Contractual liabilities - current 6(16) 11,090 - 18,310 -
2150 Notes payable - - 322 -
2170 Accounts payable 3,712 - 3,020 -
2200 Other accounts payable 6(10) 67,336 1 111,411 2
2230 Current income tax liabilities 18,949 - 1,370 -
2280 Current lease liabilities 6,451 - 5,664 -
2320 Long-term liabilities - current portion 6(11)and 8 718,775 10 1,153,308 15
2399 Other current liabilities: others 3,000 - 2,654 -
21XX Total current liabilities 2,568,912 36 2,956,059 39
Non-current liabilities
2540 Long-term borrowings 6(11)and 8 2,997,564 43 2,822,208 37
2570 Deferred income tax liabilities 6(23) 262,719 4 332,231 4
2580 Lease obligations-non-current 113,282 1 117,715 1
2610 Long-term notes and accounts 6(4)
payable 127,577 2 127,577 2
2645 Deposits received 755 - 1,370 -
25XX Total non-current liabilities 3,501,897 50 3,401,101 44
2XXX Total liabilities 6,070,809 86 6,357,160 83
Equity
Consolidated net income attributable
to owners of the parent company
Capital stock 6(13)
3110 Common share capital 1,104,856 16 1,104,856 15
Capital surplus 6(14)
3200 Capital surplus 2,169 - 2,169 -
Capital surplus 6(15)
3310 Legal reserve 82,561 1 82,561 1
3320 Special reserve 71,161 1 71,161 1
3350 Retained earnings ( 182,800) 2 87,509 1
Other equity
3400 Other equity ( 115,996)( 2 ) ( 58,991) ( 1)
31XX Total income attributable to the
owners of the parent company 961,951 14 1,289,265 17
3XXX Total equity 961,951 14 1,289,265 17
Significant contingent liabilities and 9
unrecognized contractual
commitments
3X2X Major events after the reporting
period $ 7,032,760 100 $ 7,646,425
 100 
Please refer to notes of consolidated financial statements provided at the end, which is part of this consolidated
financial report.

Chairperson of the Board: Chen Hai-niManager: Chen Hai-ni

Accounting Director: Yu Su-Ling

~30~

Holiday Garden International Ltd. and Subsidiaries Consolidated Statements of Comprehensive Income January 1 to December 31 of 2020 and 2019

Item Unit: NT$1,000
(Except earnings (loss) per share, which is in NT$1.00)
2
0
2
0
2
0
1
9
Notes
A
m
o
u
n
t
%
A
m
o
u
n
t
%
6(16)
$
741,703
100
$
1,520,242
100
6(3)(21)(22)
(
228,018)(
31) (
232,551) (
15)
513,685
69
1,287,691
85
6(6)(21)(22)

(
712,444 )(
96)(
1,067,687) (
70)
12(2)
(
667)
- (
354)
-
(
713,111)(
96) (
1,068,041) (
70)
(
199,426)(
27)
219,650
15
6(17)
15,983
3
37,413
2
6(18)
15,527
2
3,220
-
6(19)
(
185,729 ) (
25) (
31,609) (
2)
6(20)
(
140,215) (
19) (
200,382) (
13)
(
294,434) (
39) (
191,358) (
13)
(
493,860 ) (
66)
28,292
2
6(23)
223,551
30 (
32,984) (
3)
($
270,309) (
36) ($
4,692) (
1)
( $
71,256 ) (
10) ($
43,314) (
3)
6(23)
14,251
2
8,663
1
($
57,005) (
8) ($
34,651) (
2)
($
327,314) (
44) ($
39,343) (
3)
($
270,309) (
36) ($
4,692) (
1)
($
327,314) (
44) ($
39,343) (
3)
6(24)
($
2.45) ($
0.04)
( $
2.45) ($
0.04)
4000
Operating revenue
5000
Operating cost
5900
Operating gross profit
Operating expenses
6200
Management expense
6450
Expected impairment loss
6000
Total operating expenses
6900
Operating profit
Non-operating income and expenses
71100
Interest income
7010
Other income
7020
Other gains and losses
7050
Financial cost
7000
Total non-operating income and
expenses
7900
Net profit before tax
7950
Income tax expense
8200
Net profit (losses) for this year
Other comprehensive income
Components may be subsequently
reclassified to profit/loss
8361
Exchange differences on translation of
foreign financial statements
8399
Income tax of components that may be
reclassified
8300
Net amount other comprehensive income
(loss) after tax
8500
Total comprehensive income (loss)
Net income attributable to
8610
Owners of the parent company
Total comprehensive income (loss)
attributable to:
8710
Owners of the parent company
Earnings (loss) per share
9750
Basic
9850
dilution		 
Please refer to notes of consolidated financial statements provided at the end, which is part of the
consolidated financial statements.。

Chairperson of the Board: Chen Hai-ni

Manager: Chen Hai-ni

Accounting Director : Yu Su-ling

~31~

Holiday Garden International Ltd. and Subsidiaries Consolidated Statements of Changes in Equity January 1 to December 31 of 2020 and 2019

Unit: NT$1,000
2019
Balance on January 1, 2019
Net loss
Other comprehensive income
Total current comprehensive income
2018Appropriation and distribution of retained
earnings:
Legal reserve
Stock dividends
Cash dividends
Balance on December 31, 2019
2020
Balance on January 1, 2020
Net loss
Other comprehensive income
Total current comprehensive income
Balance on December 31, 2020		 N o t e s
6(15)
6(15)
6(15)		 C o n s o l i d a t e d n e t i n c o m e a t t r i b u t a b l e C o n s o l i d a t e d n e t i n c o m e a t t r i b u t a b l e C o n s o l i d a t e d n e t i n c o m e a t t r i b u t a b l e C o n s o l i d a t e d n e t i n c o m e a t t r i b u t a b l e t o s t o c k h o l d e r s o f t h e c o m p a n y
r n i n g s O t h e r e q u i t y
R e t a i n e d
e a r n i n g s
E x c h a n g e
differences on
translation of
f o r e i g n
f i n a n c i a l
s t a t e m e n t s T
o
t
a
)
$215,768
(
$24,340 )
$1,349,068
(
4,692 )
-
(
4,692 )
-
(
34,651 ) (
34,651 )
(
4,692 ) (
34,651 ) (
39,343 )
(
21,266 )
-
-
(
81,841 )
-
-
(
20,.460 )
-
(
20,460 )
87,509
(
$58,991 )
1,289,265
$ 87,509
( $ 58,991 )
$ 1,289,265
(
270,309 )
-
(
270,309 )
-
(
57,005 ) (
57,005 )
(
270,309 ) (
57,005 ) (
327,314 )
$ 182,800
($ 115,996 ) $ 961,951		 t o s t o c k h o l d e r s o f t h e c o m p a n y
r n i n g s O t h e r e q u i t y
R e t a i n e d
e a r n i n g s
E x c h a n g e
differences on
translation of
f o r e i g n
f i n a n c i a l
s t a t e m e n t s T
o
t
a
)
$215,768
(
$24,340 )
$1,349,068
(
4,692 )
-
(
4,692 )
-
(
34,651 ) (
34,651 )
(
4,692 ) (
34,651 ) (
39,343 )
(
21,266 )
-
-
(
81,841 )
-
-
(
20,.460 )
-
(
20,460 )
87,509
(
$58,991 )
1,289,265
$ 87,509
( $ 58,991 )
$ 1,289,265
(
270,309 )
-
(
270,309 )
-
(
57,005 ) (
57,005 )
(
270,309 ) (
57,005 ) (
327,314 )
$ 182,800
($ 115,996 ) $ 961,951
O r d i n a r y
share capital
$ 1,023,015 )
-
-
-
-
81,.841
-
$ 1,104,856
$ 1,104,856-
-
-
-
$ 1,104,856
C a p i t a l
s u r p l u s -
A d di ti o na l
p a i d - i n
c a pi ta l i n
e x c e s s
$2,169.
-
-
-
-
-
$2,169
$ 2,169-
-
-
--
$ 2,169		 R e t a i n e d e a r n i n g s O t h e r
Legal reserve
$61,295
-
-
-
21,266
-
$82,561
$ 82,561
-
-
-
$ 82,561		 Special reserve
$71,161
-
-
-
-
-
$71,161
$ 71,161
-
-
-
$ 71,161		 R e t a i n e d
e a r n i n g s
$215,768
(
4,692 )
-
(
4,692 )
(
21,266 )
(
81,841 )
(
20,.460 )
87,509
$ 87,509
(
270,309 )
-
(
270,309 )
$ 182,800		 E x c h a n g e
differences on
translation of
f o r e i g n
f i n a n c i a l
s t a t e m e n t s
)
(
$24,340 )

-
(
34,651 )
(
34,651 )

-

-

-
(
$58,991 )
( $ 58,991 )

-
(
57,005 )
(
57,005 )
($ 115,996 )		 



















Please refer to notes of consolidated financial statements provided at the end, which is part of the consolidated financial statements.

Chairperson of the Board: Chen Hai-ni

Manager: Chen Hai-ni

Accounting Director: Yu Su-ling

~32~

Holiday Garden International Ltd. and Subsidiaries Consolidated Cash Flow Statements

January 1 to December 31 of 2020 and 2019

Unit: NT$1,000
Cash flows from operating activities
Net profit before tax
Adjustments:
Revenue/expenses not affecting the cash flows
Provision for bad debt expense

Depreciation

Amortization cost

Financial asset loss measured at fair value through
profit or loss

Interest expense

Interest income

Gain on disposal of available-for-sale group

Loss on disposal and write-off of property, plants,
and equipment

Changes in assets/liabilities related to operating
activities
Net changes in assets related to operating activities
Notes receivable
Accounts receivable
Inventories
Advance payments
Other current assets - others
Notes receivable
Net changes in liabilities related to operating
activities
Contractual liabilities - current
Notes payable
Accounts payable
Other accounts payable
Unearned receipts
Other current liabilities: others
Operating cash inflows
Interests received
Interests paid
Refund of income tax
Income taxes paid
Net cash inflows from operating activities
Cash flows from investment activities
Acquisition of financial assets available-for-sale

Proceeds from disposal of financial assets
available-for-sale
Decrease (increase) in other financial assets - current
Acquisition of property, plants, and equipment

Disposal of property, plants, and equipment

Cash and cash equivalents classified to the group
available for sale
Decrease (increase) in guarantee deposits paid

Decrease in other non-current assets - others
Net cash inflows (outflows) from investment
activities
Acquisition of financial assets available-for-sale
Proceeds from disposal of financial assets
available-for-sale
Cash flows from fundraising activities
Increase in short-term borrowings

Decrease in short-term borrowings

Increase in short-term notes and bills payable

Proceeds from long-term borrowings

Payments of long-term borrowings

Increase in guarantee deposits received
Distribution of cash dividends
 Note
2020
2019
( $ 493,860 ) $ 28,292


12(2)
667
354
6(4)(5)(21)
210,080
207,332
6(6)(21)
49,923
43,062
6(5)
(
16 )
-
6(20)
140,215
200,382
6(17)
(
15,983 ) (
37,413 )
6(19)
- (
62 )
6(7)(19)
132,975
-


1,438 (
638 )
7,928 (
1,819 )
(
355 ) (
358 )
67 (
752 )
(
2,157 ) (
830 )
98
6

(
7,084 )
8,193
(
322 ) (
1,150 )
692 (
2,872 )
(
36,839 )
16,012
346
877
(
12,187 )
458,616
18,716
37,403
(
142,725 ) (
196,006 )
5,187
-
(
18,635 )
(
131,009)
281,378

6(26)
$ -
49,196
- (
409,760 )
25,481
-
6(25)
- (
2,045,468 )
6(26)
(
3,464 ) (
8,595 )
-
495
6(6)
- (
1,804 )
(
105,227 ) (
83,278 )
(
2,111 ) (
1,367 )
11
4
(
85,310 ) (
2,500,577 )

6(27)
1,791,099
1,660,000
6(27)
(
1,711,500 ) (
1,334,500 )
6(27)
(
4,730 ) (
2,118 )
6(27)
1,060,660
1,441,860
6(27)
(
1,125,967 ) (
156,079 )
615 )
215
6(15)
- (
20,460 )		 
~33~

Holiday Garden International Ltd. and Subsidiaries Consolidated Cash Flow Statements January 1 to December 31 of 2019 and 2018

Unit: NT$1,000
Net cash inflows from fundraising activities
Effect of exchange rate changes
Increase (decrease) in cash and cash equivalents of the
current period
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period		 Note
2020
2019
8,947
1,588,918
(
45,454 ) (
31,030 )
(
252,826 ) (
661,311 )
6(1)
1,139,837
1,801,148
6(1)
$ 887,011$ 1,139,837

Please refer to notes of consolidated financial statements provided at the end, which is part of the consolidated financial statements.

Chairperson of the Board: Chen Hai-ni Manager: Chen Hai-ni Accounting Director: Yu Su-ling 

~34~

Attachment 3

Hotel Holiday Garden For the year 2020 Deficit Compensation Table

Unit: New Taiwan dollar

Unit: New Taiwan dollar Unit: New Taiwan dollar Unit: New Taiwan dollar
Items Amount
Sub-total Total
Retained earnings at the beginning
Less: Submit a 10% legal capital surplus
Deficit Compensation at the end

$ 87,508,942
(270,309,127)
$ (182,800,185

Note: According to the letter of 2012.04.06, the certificate No. 1010012865 issued by the Financial Supervisory Committee, due to the selection of the International Financial Reporting Standard No. 1 exemption project, the Company has not realized the revaluation and added value to the retained surplus portion, and proposed a special surplus reserve of NT 71,161 thousand dollars. The special surplus reserve is not able to bring forward to 2020.

Chairperson of the Board: Chen Hai-ni Manager: Chen Hai-ni Accounting Director: Yu Su-ling 

~35~

Attachment 4

Hotel Holiday Garden

Amendment Revisions of Codes of Ethical Conduct

Article Clause before amendment Clause after amendment Purpose of
amendment
Article 4 The Company's personnel shall
conduct their official duties in
an objective and efficient
manner, and in the event of a
conflict between their own
interests and those of the
Company, they shall give
priority to the Company's
interests and shall not use their
position with the Company to
improperly benefit themselves,
their spouses, parents, children
or relatives within the third
degree of consanguinity.
In the event that the Company
and the affiliates of the
aforementioned officers have
lending of funds or providing
guarantees for them, major asset
transactions, or operational
transactions, the relevant
Company officers shall take the
initiative to explain to the
Company whether there is any
potential conflict of interest
between them and the
Company, and shall follow the
Company's regulations in order
to prevent conflict of interest.		 The Company's personnel shall
conduct their official duties in an
objective and efficient manner,
and in the event of a conflict
between their own interests and
those of the Company, they shall
give priority to the Company's
interests and shall not use their
position with the Company to
improperly benefit themselves,
their spouses, within the second
degree of consanguinity.
In the event that the Company
and the affiliates of the
aforementioned officers have
lending of funds or providing
guarantees for them, major asset
transactions, or operational
transactions, the relevant
Company officers shall take the
initiative to explain to the
Company whether there is any
potential conflict of interest
between them and the Company,
and shall follow the Company's
regulations in order to prevent
conflict of interest.		 In consideration
of the fact that
both parents
and children are
relatives within
the second
degree of
consanguinity,
the text of two
(1) shall be
streamlined as
appropriate.		 
~36~

Attachment 5

Hotel Holiday Garden

Amendment Revisions of Board of Directors Meetings

June 16, 2021

Article Clause before amendment Clause after amendment Purpose of
amendment
Article 3 (Call of the Board of Directors
and Notice of Meeting)
Items 1 and 2 omitted
The notice set forth in the
preceding paragraph may be
effected by means of written
notification, electronic
transmission, FAX, after
obtaining prior consent from the
recipients thereof.
The followingomitted		 (Call of the Board of Directors
and Notice of Meeting)
Items 1 and 2 omitted
The notice set forth in the
preceding paragraph may be
effected by means of electronic
transmission, after obtaining prior
consent from the recipients
thereof.
The following omitted		 In order to
conform to
amendments to
related laws
Article 4 The board of directors of a
company appointan agenda
working group, which is Finance
Department.
The agenda working group shall
prepare agenda items for board
of directors meetings and
provide sufficient pre-meeting
materials, to be sent together
with the notice of the meeting.
A director of the opinion that the
pre-meeting materials provided
are insufficiently sufficient may
request the agenda group to
supplement the materials.
If a director is of the opinion that
materials concerning any
proposal are insufficient in
content, the deliberation of such
proposal may be postponed by a
resolution of the board of
directors.		 The board of directors of a
company appointan agenda
working group, which is Finance
Department.
The agenda working group shall
prepare agenda items for board of
directors meetings and provide
comprehensive pre-meeting
materials, to be sent together with
the notice of the meeting.
A director of the opinion that the
pre-meeting materials provided
are insufficiently comprehensive
may request the agenda working
group to supplement the materials.
If a director is of the opinion that
materials concerning any proposal
are insufficient in content, the
deliberation of such proposal may
be postponed by a resolution of
the board of directors.		 In order to
conform to
amendments to
related laws		 
~37~
Article Clause before amendment Clause after amendment Purpose of
amendment
Article 7 Where a meeting of the board of
directors is called by the
chairman of the board, the
meeting shall be chaired by the
chairperson. However, where the
first meeting of each newly
elected board of directors is
called by the director who
received votes representing the
largest portion of voting rights at
the shareholders' meeting in
which the directors were elected,
the meeting shall be chaired by
that director; if there are two or
more directors so entitled to call
the meeting, they shall choose
one person by and from among
themselves to chair the meeting.
The following omitted		 Where a meeting of the board of
directors is called by the chairman
of the board, the meeting have
chaired by the chairman.
However, where the first meeting
of each newly elected board of
directors is called by the director
who received votes representing
the largest portion of voting rights
at the shareholders' meeting in
which the directors were elected,
the meeting shall be chaired by
that director; if there are two or
more directors so entitled to call
the meeting, they shall choose one
person by and from among
themselves to chair the meeting.
Where a meeting of the board of
directors is called by a majority of
directors on their own initiative in
accordance with Article 203,
paragraph 4 or Article 203-1,
paragraph 3 of the Company Act,
the directors shall choose one
person by and from among
themselves to chair the meeting.
The following omitted		 In order to
conform to
amendments to
related laws		 
~38~
Article Clause before amendment Clause after amendment Purpose of
amendment
Article 9 Items 1 omitted
If before the end of the
preservation period referred to in
the preceding paragraph any
litigation arises in connection
with a resolution of a board of
directors meeting, the relevant
audio or video recordings shall
continue to be preserved, the
provisions of the preceding
paragraph shall are not
applicable.
The following omitted		 Items 1 omitted
If before the end of the
preservation period referred to in
the preceding paragraph any
litigation arises in connection with
a resolution of a board of directors
meeting, the relevant audio or
video recordings shall continue to
be preserved until the litigation is
concluded.
The following omitted		 In order to
conform to
amendments to
related laws
Article 12 A company shall submit the
following items for discussion by
the board of directors:
1.Corporate business plan.
2.Annual and semi-annual
financial reports, with the
exception of semi-annual
financial reports which, under
relevant laws and regulations.
3.Adoption or amendment of an
internal control system pursuant
to Article 14-1 of Securities and
Exchange Act, and an
assessment of the effectiveness
of the internal control system.
4.Adoption or amendment,
pursuant to Article 36-1 of
Securities and Exchange Act, of
handling procedures for financial
or operational actions of material
significance, such as acquisition
or disposal of assets, derivatives
trading, extension of monetary
loans to others, and
endorsements or guarantees for
others.
A company shall submit the
following items for discussion by
the board of directors:
1.Corporate business plan.
2.Annual and semi-annual
financial reports, with the
exception of semi-annual financial
reports which, under relevant laws
and regulations.
3.Adoption or amendment of an
internal control system pursuant to
Article 14-1 of Securities and
Exchange Act, and an assessment
of the effectiveness of the internal
control system.
4.Adoption or amendment,
pursuant to Article 36-1 of
Securities and Exchange Act, of
handling procedures for financial
or operational actions of material
significance, such as acquisition
or disposal of assets, derivatives
trading, extension of monetary
loans to others, and endorsements
or guarantees for others.
In order to
conform to
amendments to
related laws		 
~39~
Article Clause before amendment Clause after amendment Purpose of
amendment
Article 12 5.The offering, issuance, or
private placement of any
equity-type securities.
6.The appointment or discharge
of a financial, accounting, or
internal audit officer.
7.A donation to a related party or
a major donation to a non-related
party, provided that a
public-interest donation of
disaster relief for a major natural
disaster may be submitted to the
following board of directors
meeting for retroactive
recognition.
8.Any matter required by Article
14-3 of Securities and Exchange
Act, or any other law, regulation,
or bylaw to be approved by
resolution at a shareholders'
meeting or board of directors
meeting, or any such significant
matter as may be prescribed by
the competent authority.
The remuneration of directors
and officers shall be discussed
and decided by the Board of
Directors after the Compensation
Committee has made its
recommendations.
If the Board of Directors does not
adopt or revise the
recommendations of the
Compensation Committee
regarding the compensation of
directors and officers,
5.The offering, issuance, or private
placement of any equity-type
securities.
6.The appointment or discharge of
a financial, accounting, or internal
audit officer.
7.A donation to a related party or a
major donation to a non-related
party, provided that a
public-interest donation of disaster
relief for a major natural disaster
may be submitted to the following
board of directors meeting for
retroactive recognition.
8.Any matter required by Article
14-3 of Securities and Exchange
Act, or any other law, regulation,
or bylaw to be approved by
resolution at a shareholders'
meeting or board of directors
meeting, or any such significant
matter as may be prescribed by the
competent authority.
The term "related party" in
subparagraph 7 of the preceding
paragraph means a related party as
defined in the Regulations
Governing the Preparation of
Financial Reports by Securities
Issuers.
The term "major donation to a
non-related party" means any
individual donation, or cumulative
donations within a 1-year period to
a single recipient, at an amount of
NTD100 million or more,




In order to
conform to
amendments to
related laws		 
~40~
Article Clause before amendment Clause after amendment Purpose of
amendment
Article 12 the Board of Directors shall
require the presence of at least
two-thirds of all directors and the
approval of a majority of the
directors present,
and shall state in the resolution
whether the compensation
approved by the Board of
Directors is superior to the
recommendations of the
Compensation Committee. If the
remuneration approved by the
Board of Directors is superior to
the recommendation of the
Compensation Committee, the
circumstances and reasons for
the difference shall be set forth
in the minutes of the Board of
Directors' meeting and shall be
announced and reported within
two days from the date of
approval by the Board of
Directors.
The term "related party" in
subparagraph 7 of the preceding
paragraph means a related party
as defined in the Regulations
Governing the Preparation of
Financial Reports by Securities
Issuers. The term "major
donation to a non-related party"
means any individual donation,
or cumulative donations within a
1-year period to a single
recipient, at an amount of
NTD100 million or more, or at
an amount equal to or greater
than 1 percent of net operating
revenue or 5 percent of paid-in
capital as stated in the
or at an amount equal to or greater
than 1 percent of net operating
revenue or 5 percent of paid-in
capital as stated in the
CPA-attested financial report for
the most recent year.
The term "within a 1-year period"
in the preceding paragraph means a
period of 1 year calculated
retroactively from the date on
which the current board of
directors meeting is convened.
Amounts already submitted to and
passed by a resolution of the board
are exempted from inclusion in the
calculation.
For foreign companies whose stock
has no par value or a par value
other than NTD10, the "5 percent
of paid-in capital" in paragraph 2
above shall be calculated instead as
2.5 percent of shareholder equity.
If a company has an independent
director or directors, at least one
independent director shall attend
each meeting in person. In the case
of a meeting concerning any matter
required to be submitted for a
resolution by the board of directors
under paragraph 1, each
independent director shall attend in
person; if an independent director
is unable to attend in person, he or
she shall appoint another
independent director to attend as
his or her proxy.








In order to
conform to
amendments to
related laws		 
~41~
Article Clause before amendment Clause after amendment Purpose of
amendment
Article 12 CPA-attested financial report for
the most recent year.
The term "within a 1-year
period" in the preceding
paragraph means a period of 1
year calculated retroactively
from the date on which the
current board of directors
meeting is convened. Amounts
already submitted to and passed
by a resolution of the board are
exempted from inclusion in the
calculation.
For foreign companies whose
stock has no par value or a par
value other than NTD10, the "5
percent of paid-in capital" in
paragraph 2 above shall be
calculated instead as 2.5 percent
of shareholder equity.
If a company has an independent
director or directors, at least one
independent director shall attend
each meeting in person. In the
case of a meeting concerning any
matter required to be submitted
for a resolution by the board of
directors under paragraph 1, each
independent director shall attend
in person; if an independent
director is unable to attend in
person, he or she shall appoint
another independent director to
attend as his or her proxy.
If an independent director
expresses any objection or
reservation about a matter, it
shall be recorded in the board
meeting minutes.

If an independent director
expresses any objection or
reservation about a matter,
it shall be recorded in the board
meeting minutes. An independent
director intending to express an
objection or reservation but unable
to attend the meeting in person
shall, unless there is some
legitimate reason to do otherwise,
issue a written opinion in advance,
which shall be recorded in the
meeting minutes.
The following omitted

In order to
conform to
amendments to
related laws		 
~42~
Article Clause before amendment Clause after amendment Purpose of
amendment
Article 12 An independent director
intending to express an objection
or reservation but unable to
attend the meeting in person
shall, unless there is some
legitimate reason to do
otherwise, issue a written
opinion in advance, which shall
be recorded in the meeting
minutes.
The following omitted		 In order to
conform to
amendments to
related laws
Article 15 If any director or a juristic
person represented by a director
is an interested party with
respect to any agenda item, the
director shall state the important
aspects of the interested party
relationship at the respective
meeting. When the relationship
is likely to prejudice the interests
of the company, the director may
not participate in discussion or
voting on that agenda item, and
further, shall enter recusal during
discussion and voting on that
item and may not act as another
director's proxy to exercise
voting rights on that matter.
The following omitted		 If any director or a juristic person
represented by a director is an
interested party with respect to
any agenda item, the director
shall state the important aspects
of the interested party
relationship at the respective
meeting. When the relationship is
likely to prejudice the interests of
the company, the director may
not participate in discussion or
voting on that agenda item, and
further, shall enter recusal during
discussion and voting on that
item and may not act as another
director's proxy to exercise
voting rights on that matter.
Where the spouse or a blood
relative within the second degree
of kinship of a director, or a
company which has a controlling
or subordinate relation with a
director, is an interested party
with respect to an agenda item as
described in the preceding		 In order to
conform to
amendments to
related laws		 
~43~
Article Clause before amendment Clause after amendment Purpose of
amendment
Article 15 paragraph, such director shall be
deemed to be an interested party
with respect to that agenda item.
The following omitted		 In order to
conform to
amendments to
related laws
Article 16 (Meeting minutes and
Signatures)
paragraphs 1 to 8 in Items 1 are
omitted.
9. Other items to be recorded.
The board of directors' sign-in
book shall be part of the minutes
and shall be kept permanently.
The following omitted		 (Meeting minutes and Signatures)
paragraphs 1 to 8 in Items 1 are
omitted.
9. Other items to be recorded.
Any of the following matters in
relation to a resolution passed at a
meeting of the board of directors
shall be stated in the meeting
minutes and within two days of the
meeting be published on an
information reporting website
designated by the competent
authority:
1.Any matter about which an
independent director expresses an
objection or reservation that has
been included in records or stated
in writing.
2.If the company has an audit
committee, any matter that has not
been passed by the audit
committee, but has been adopted
with the approval of two-thirds or
more of all board directors without
having been passed by the audit
committee.
The board of directors' sign-in
book shall be part of the minutes
and shall be kept permanently.
The following omitted

In order to
conform to
amendments to
related laws		 
~44~
Article Clause before amendment Clause after amendment Purpose of
amendment
Article 18 The provisions of Article 2,
paragraph 2 of Article 3, Articles
4 to 6, Article 9, and Articles 11
to 18 shall apply mutatis
mutandis to the procedure for
meetings of the managing
directors.		 The provisions of Article 2,
paragraph 2 of Article 3, Articles 4
to 6, Article 9, and Articles 11 to
18 shall apply mutatis mutandis to
the procedure for meetings of the
managing directors, provided that
if a meeting of managing directors
is scheduled to be convened within
seven days, the notice to each
managing director may be made
two days in advance.

In order to
conform to
amendments to
related laws		 
~45~

Attachment 6

Hotel Holiday Garden Amendment Revisions of Procedures for Directors

June 16, 2021 June 16, 2021
Article Clause before amendment Clause after amendment Purpose of
amendment
title Procedures for Directors and
supervisors		 Procedures for Directors Cooperateing
with the
Financial
Supervisory
Commission
R.O.C.'s
issuance of
FSC Order No.
10703452331
on December
19, 2018,
Adjust the
name oftitle
Article 5 The election of directors of the
Company shall be conducted in
accordance with the procedures
of the nomination system for
candidates as set forth in Article
192-1 of the Company Act. The
Company shall examine the
qualifications of the candidates
for directors, their academic
background, and whether they
have any of the matters listed in
Article 30 of the Company Act,
and shall not arbitrarily add
other documents to prove their
qualifications.
If for any reason the number of
directors is less than seven, the
Company shall hold a
by-election at the most recent		 The election of directors of the
Company shall be conducted in
accordance with the procedures
of the candidate nomination
system set forth in Article 192-1
of the Company Act.
If, for any reason, the number of
directors is less than five, the
Company shall hold a
by-election at the most recent
shareholders' meeting. However,
if the number of director
vacancies reaches one-third of
the number of seats set forth in
the Articles of Incorporation, the
Company shall convene an
interim shareholders' meeting to
hold a by-election within 60 days
from the date of occurrence of		 To simplify
the
procedures
for
nominating
directors in
accordance
with the
amendment
to Article
192-1 of the
Company
Act.		 
~46~
shareholders' meeting to hold a
by-election within 60 days from		 the fact. If the number of
independent directors is
Article Clause before amendment Clause after amendment Purpose of
amendment
Article 5 occurrence. less than the first proviso of
Article 14-2
of the Securities and Exchange
Act, a by-election shall be held at
the latest shareholders' meeting;
if all independent directors are
dismissed, a by-election shall be
held at the shareholders' meeting
within 60 days from the date of
occurrence.		 
~47~
Article 11
An election ballot is invalid if
one of the following
circumstances occurs.
1 The ballot paper prepared by
the Board of Directors is not
used.
2 A blank ballot is placed in the
ballot box.
3 The handwriting is illegible or
altered.
4 If the name of the electee is a
shareholder, the name and
shareholder number of the
electee do not match with the
shareholder's register; if the
name of the electee is not a
shareholder, the name and
identification number of the
electee do not match with the
shareholder's register.
5If the name of the electee
(name) or the shareholder's
account number (identity
document number) and the
number of allocated election
rights are written in addition to
the name of the electee (name)
or the shareholder's account
number(identitydocument		 Article 10
An election ballot is invalid if
one of the following
circumstances occurs.
1 The ballot paper prepared by
convenors is not used.
2 A blank ballot is placed in the
ballot box.
3 The handwriting is illegible or
altered.
4 The list of candidates for
election does not match with the
list of candidates for director.
5 in addition to the Allocation of
Election Rightsrights is filled in,
and then other words are
included.		 In
conjunction
with the
deletion of
Article 10,
the
amendment
to the Article
and the
amendment
to the Act.
Article Clause before amendment Clause after amendment Purpose of
amendment
number).
6 The name of the person to be
elected is the same as that of
other shareholders, but the
shareholder account number or
identification document number
is not filled in for identification.		 
~48~
Article 12
Skip		 Article 11
Skip		 In
conjunction
with the
deletion of
Article 10,
the
amendment
to the Article.
Article 13
Skip		 Article 12
Skip		 In
conjunction
with the
deletion of
Article 10,
the
amendment
to the Article.
Article 14
Skip		 Article 13
Skip		 In
conjunction
with the
deletion of
Article 10,
the
amendment
to the Article.		 
~49~

Attachment 7

Hotel Holiday Garden

Amendment Revisions of Procedures for Procedure of Shareholders' Meetings

June 16, 2021 June 16, 2021
Article Clause before amendment Clause after amendment Purpose of
amendment
Article 2 Items 1 to 4 are omitted
The number of shares present is
calculated based on the sign-in
book or hand in the attendance
card . The number of shares for
which the voting rights are
exercised by written or
electronic means shall be added
to the calculation.		 Items 1 to 4 are omitted
The Company shall deliver to the
shareholders present at the
shareholders' meeting the
meeting manual, annual report,
attendance cards, speech slips,
voting tickets and other meeting
materials; if there is an election
of directors or supervisors, a
separate election ticket shall be
attached.
If the government or a legal
entity is a shareholder, there shall
be no more than one
representative attending the
shareholders' meeting.
The number of shares present is
calculated based on the sign-in
book or hand in the attendance
card . The number of shares for
which the voting rights are
exercised by written or electronic
means shall be added to the
calculation.
The number of shares acquired
by the requester and the number
of shares represented by proxy
shall be clearly disclosed in the
shareholders' meeting on the date
of the shareholders' meeting in
accordance with the statistical
tables prepared in the prescribed
format.
The Companyshall transmit to		 In order to
conform to
amendments
to related
laws		 
~50~
the Market Observation Post
System (MOPS), within the
prescribed time, any material
information regarding the
resolution of the shareholders'
meeting that is required by law
or the regulations of the Taiwan
Stock Exchange(Taipei
Exchange).
Article 3 Items 1 to 3 are omitted
The election or dismissal of
directors or supervisors, change
of articles of incorporation,
reduction of capital, application
for suspension of public
offering, permission for
directors to compete for
business, transfer of capital
from earnings to capital, transfer
of capital from reserves to
capital, dissolution, merger,
division, or any of the matters
set forth in Article 185,
Paragraph 1, shall be listed in
the cause of convocation and the
main contents thereof shall be
stated, and no motion shall be
made on an ad hoc basis.
The main content of the notice
may be placed on the website
designated by the securities
authority or the Company, and
the website address shall be
included in the notice.
After the completion of the
general election of directors and
supervisors and the date of their
appointment, the date of their
appointment may not be
changed at the same meeting by
temporary motion or other
means.		 Items 1 to 3 are omitted
The election or dismissal of
directors or supervisors, change
of articles of incorporation,
reduction of capital, application
for suspension of public offering,
permission for directors to
compete for business, transfer of
capital from earnings to capital,
transfer of capital from reserves
to capital, dissolution, merger,
division, or any of the matters set
forth in Article 185, Paragraph 1,
shall be listed in the cause of
convocation and the main
contents thereof shall be stated,
and no motion shall be made on
an ad hoc basis.
After the completion of the
general election of directors and
supervisors and the date of their
appointment, the date of their
appointment may not be changed
at the same meeting by
temporary motion or other
means.
Shareholders holding at least one
percent of the total number of
issued shares may propose to the
Company a motion for an
ordinary shareholders' meeting,
limited to one proposal, and any
proposal exceedingone shall		 In order to
conform to
amendments
to related
laws		 
~51~
Shareholders holdingat least
Article 3 one percent of the total number
of issued shares may propose to
the Company a motion for an
ordinary shareholders' meeting,
limited to one proposal, and any
proposal exceeding one shall
not be included in the motion.
However, the Board of
Directors may include a
proposal from a shareholder to
urge the Company to promote
public interest or fulfill its social
responsibility. In addition, the
Board of Directors may not
include a shareholder's proposal
in any of the circumstances set
forth in Article 172-1,
Paragraph 4 of the Company
Act.
The Company shall announce
the acceptance of the
shareholders' proposals, the
written or electronic means of
acceptance, the place of
acceptance, and the period of
acceptance no less than ten days
prior to the date of cessation of
stock transfer prior to the
shareholders' meeting; the
period of acceptance shall not
be less than ten days. A
shareholder's proposal shall be
limited to 300 words, and if the
proposal exceeds 300 words, the
proposal shall not be included in
the motion; the proposing attend
the shareholders' meeting in
person or by proxy and
participate in the discussion of
the proposal.		 not be included in the motion.
However, the Board of Directors
may include a proposal from a
shareholder to urge the Company
to promote public interest or
fulfill its social responsibility. In
addition, the Board of Directors
may not include a shareholder's
proposal in any of the
circumstances set forth in Article
172-1, Paragraph 4 of the
Company Act.
The Company shall announce the
acceptance of the shareholders'
proposals, the written or
electronic means of acceptance,
the place of acceptance, and the
period of acceptance no less than
ten days prior to the date of
cessation of stock transfer prior
to the shareholders' meeting; the
period of acceptance shall not be
less than ten days. A
shareholder's proposal shall be
limited to 300 words, and if the
proposal exceeds 300 words, the
proposal shall not be included in
the motion; the proposing
shareholder shall attend the
shareholders' meeting in person
or by proxy and participate in the
discussion of the proposal. The
Company shall notify the
proposing shareholder of the
results of the proceedings before
the date of the notice of the
shareholders' meeting, and shall
include in the notice of the
meeting those motions that
comply with the provisions of		 
~52~
Article 3 The Company shall notify the
proposing shareholder of the
results of the proceedings before
the date of the notice of the
shareholders' meeting, and shall
include in the notice of the
meeting those motions that
comply with the provisions of
this Article. The Board of
Directors shall state the reasons
for not including the proposal in
the shareholders' meeting.
Attendance and voting at
shareholders' meetings shall be
based on shares, if a shareholder
proposes a headcount, the
Chairman may not accept it.
The number of shares of
non-voting shareholders is not
included in the total number of
issued shares in the resolution of
the shareholders' meeting.
A shareholder may not vote at a
meeting if he or she has an
interest in the meeting that
would be detrimental to the
Company's interests, and may
not exercise his or her voting
rights on behalf of another.
The number of shares for which
the Company may not exercise
its voting rights as described
above shall not be counted as
the voting rights of the
shareholders present. Except for
trust companies or stock
agencies approved by the
securities authorities, if a person
is appointed by more than two
shareholders at the same time,		 this Article. The Board of
Directors shall state the reasons
for not including the proposal in
the shareholders' meeting.
Attendance and voting at
shareholders' meetings shall be
based on shares.
The number of shares of
non-voting shareholders is not
included in the total number of
issued shares in the resolution of
the shareholders' meeting.
A shareholder may not vote at a
meeting if he or she has an
interest in the meeting that would
be detrimental to the Company's
interests, and may not exercise
his or her voting rights on behalf
of another shareholder.
The number of shares for which
the Company may not exercise
its voting rights as described
above shall not be counted as the
voting rights of the shareholders
present.
Except for trust companies or
stock agencies approved by the
securities authorities, if a person
is appointed by more than two
shareholders at the same time,
the voting rights of the proxy
shall not exceed 3% of the total
number of issued shares, and the
voting rights in excess of that
shall not be counted.		 
~53~
Article 3 the voting rights of the proxy
shall not exceed 3% of the total
number of issued shares, and
the voting rights in excess of
that shall not be counted.
Article 4 The Company's shareholders'
meetings shall be held at the
place where the Company
operates or at a place convenient
for the shareholders to attend
and suitable for the
shareholders' meetings, and the
meetings shall commence no
earlier than 9:00 a.m. or later
than 3:00 p.m.		 The Company's shareholders'
meetings shall be held at the
place where the Company
operates or at a place convenient
for the shareholders to attend and
suitable for the shareholders'
meetings, and the meetings shall
commence no earlier than 9:00
a.m. or later than 3:00 p.m. The
venue and time of the meeting
shall take into full consideration
the opinions of the independent
directors.		 In order to
conform to
amendments
to related
laws
Article 5 The chairman of the
shareholders' meeting shall be
governed by Article 182-1 of the
Company Act.		 The chairman of the shareholders'
meeting shall be governed by
Article 182-1 of the Company
Act.
If the shareholders' meeting is
convened by the board of
directors, the chairman of the
meeting shall be the chairman of
the board of directors. If the
chairman of the board of
directors is absent from office or
is unable to exercise his or her
duties for any reason, the vice
chairman of the board of
directors shall act as his or her
proxy. The chairman of the board
of directors shall be appointed by
the chairman of the board of
directors.
If the chairman of the Board of
Directors is represented by a
managing director or a director,		 In order to
conform to
amendments
and addition
for related
laws		 
~54~
Article 5 a managing director or a director
who has been in office for at least
six months and understands the
financial condition of the
Company shall serve as the
chairman. The same applies if the
chairman is a representative of a
corporate director. The chairman
of the board of directors shall
preside in person at any
shareholders' meeting called by
the board of directors, and a
majority of the board of directors,
at least one supervisor shall be
present in person, and at least one
member of each functional
committee shall be present to
represent the board of directors,
and the attendance shall be
recorded in the minutes of the
shareholders' meeting.
If a shareholders' meeting is
convened by someone other than
the Board of Directors, the
chairman of the meeting shall be
the convener of the meeting, and
if there are more than two
conveners, one shall be elected
from among themselves.		 
~55~
Article 8 If the time for a meeting has
expired, the chairman shall
immediately announce the
meeting. However, if the
shareholders representing more
than one-half of the total
number of issued shares are not
present, the chairman may
announce an adjournment of the
meeting for a maximum of two
times, with the total time of the
adjournment not exceeding one
hour. If the second
postponement is still
insufficient, but the
shareholders representing
one-third or more of the total
number of issued shares are
present, a sham resolution may
be made in accordance with
Article 175(1) of the Company
Act.
The following is omitted		 If the time for a meeting has
expired, the chairman shall
immediately announce the
meeting. However, if the
shareholders representing more
than one-half of the total number
of issued shares are not present,
the chairman may announce an
adjournment of the meeting for a
maximum of two times, with the
total time of the adjournment not
exceeding one hour.
The number of non-voting rights
and the number of shares present
will be announced at the same
time.
If the second postponement is
still insufficient, but the
shareholders representing
one-third or more of the total
number of issued shares are
present, the meeting shall be
adjourned by the chairman. In
the event that there is a shortage
of shareholders representing at
least one-third of the total
number of issued shares after the
second postponement of the
preceding item, the meeting shall
be adjourned.
A sham resolution may be made
in accordance with Article
175(1) of the Company Act.
The shareholders will be notified
of the bogus resolution to
convene another shareholders'
meeting within one month.
The following is omitted		 In order to
conform to
amendments
to related
laws		 
~56~
Article 9 If a shareholders' meeting is
convened by the Board of
Directors, the agenda shall be
set by the Board of Directors
and the meeting shall be
conducted in accordance with
the scheduled agenda, which
may not be changed without a
resolution of the shareholders'
meeting.
The following is omitted		 If a shareholders' meeting is
convened by the Board of
Directors, the agenda shall be set
by the Board of Directors, the
relevant motions (including
provisional motions and
amendments to original motions)
should be voted on on a
case-by-case basis, and the
meeting shall be conducted in
accordance with the scheduled
agenda, which may not be
changed without a resolution of
the shareholders' meeting.
The followingis omitted		 In order to
conform to
amendments
to related
laws
Article 11 Each shareholder shall speak no
more than once on the same
motion, and each speech shall
not exceed three minutes,
without the consent of the
chairman. If a shareholder
speaks in violation of the
foregoing provisions or exceeds
the scope of the question, the
chairman may stop his or her
speech or make other
appropriate disposition.		 Each shareholder shall speak no
more than twice on the same
motion, and each speech shall
not exceed five minutes, without
the consent of the chairman. If a
shareholder speaks in violation
of the foregoing provisions or
exceeds the scope of the
question, the chairman may stop
his or her speech or make other
appropriate disposition.		 In order to
conform to
amendments
to related
laws
Article 14 No discussion or vote on the
matter reported or not as a
motion, if the chairman
considers that the discussion of
a motion has reached the level
of being ready for voting, he/she
may declare that the discussion
has been stopped and put to a
vote.		 The chairman shall give
sufficient opportunity to explain
and discuss the motions and the
amendments or temporary
motions proposed by the
shareholders, and may declare
the discussion closed and vote on
them when he/she considers that
they are ready to be voted on.
The chairman of the board of
directors shall give an		 In order to
conform to
amendments
to related
laws		 
~57~
Article 14 opportunity to explain and
discuss the proposed
amendments or provisional
motions and, if he/she deems that
they are ready to be voted on,
he/she may declare that the
discussion is closed and proceed
to vote.
Article 15 The chairman shall appoint the
scrutineers and vote-counters
for voting on motions or
election matters. However, the
scrutineers shall have the status
of shareholders.		 The chairman shall appoint the
scrutineers and vote-counters for
voting on motions or election
matters. However, the scrutineers
shall have the status of
shareholders.
The counting of votes for a
shareholders' meeting or an
election proposal shall be
conducted in an open place on
the floor of the shareholders'
meeting, and the voting results,
including the number of votes
counted, shall be announced and
recorded on the spot after the
counting of votes is completed.		 In order to
conform to
amendments
to related
laws
Article 16 During a meeting, the chairman
may announce a break at his
discretion. In the event of an
unavoidable situation, the
chairman may suspend the
meeting and announce the time
of resumption of the meeting as
appropriate.		 During a meeting, the chairman
may announce a break at his
discretion. In the event of an
unavoidable situation, the
chairman may suspend the
meeting and announce the time
of resumption of the meeting as
appropriate.
If the meeting venue cannot be
used before the end of the
meeting (including temporary
motions), the shareholders'
meeting may resolve to find
another venue to continue the
meeting.		 In order to
conform to
amendments
to related
laws		 
~58~
Article 16 In accordance with Article 182
of the Company Act, the
shareholders' meeting may
resolve to postpone or renew the
meetingwithin five days.
Article 17 Items 1 to 4 are omitted.
Except as otherwise provided in
the relevant laws and
regulations or the Company's
Articles of Incorporation, voting
on motions shall be by a
majority of the votes cast by the
shareholders present.
A motion shall be deemed to
have been passed if the
Chairman consults all
shareholders present and there is
no dissenting vote, and shall
have the same effect as a poll.		 Items 1 to 4 are omitted.
Except as otherwise provided in
the relevant laws and regulations
or the Company's Articles of
Incorporation, voting on motions
shall be by a majority of the
votes cast by the shareholders
present.
In the case of voting, the
chairman or his or her designee
shall announce the total number
of voting rights of shareholders
present on a case-by-case basis,
and then the shareholders shall
vote on each case, and on the day
after the shareholders' meeting,
the results of shareholders'
The results of the shareholders'
approval, disapproval and
abstention shall be entered into
the Market Observation Post
System on the day after the
shareholders' meeting.
In the event of an election of
directors and supervisors at a
shareholders' meeting, the
election results shall be
announced on the spot, including
the list of elected directors and
supervisors and the number of
their elected rights, as well as the
list of unsuccessful directors and
supervisors and the number of
election rights they received.
The election ballots for the		 In order to
conform to
amendments
and addition
for related
laws		 
~59~
Article 17 aforementioned election shall be
sealed and signed by the
scrutineers and kept in a safe
place for at least one year.
However, if a lawsuit is filed by
a shareholder in accordance with
Article 189 of the Company Act,
it shall be kept until the end of
the lawsuit.
The Company shall keep the
election ballots for at least one
year.
Article 18 If there are amendments or
substitutions to the same motion,
the Chairman shall determine
the order of voting on them
together with the original
motion. If one of the motions
has been passed, the other
motions shall be considered as
negatived and shall not be voted
on again.		 If there are amendments or
substitutions to the same motion,
the Chairman shall determine the
order of voting on them together
with the original motion. If one
of the motions has been passed,
the other motions shall be
considered as negatived and shall
not be voted on again.
The minutes of the shareholders'
meeting shall be prepared, signed
or sealed by the chairman, and
distributed to the shareholders
within 20 days after the meeting.
The minutes may be prepared
and distributed electronically.
The aforementioned minutes
may be distributed by means of
an announcement entered into
the Market Observation Post
System.
The Company shall record the
year, month, day, place, name of
the chairman, method of
resolution, main points of the
proceedings, and voting results
(including the number of votes)
of the meeting, and in the case		 In order to
conform to
amendments
and addition
for related
laws		 
~60~

of election of directors and Article 18 supervisors, the number of votes received by each candidate. The records shall be kept permanently for the duration of the Company's existence. 

~61~

Attachment 8

Hotel Holiday Garden

Amendment Revisions of Management of Loans to Others

June 16, 2021 June 16, 2021
Article Clause before amendment Clause after amendment Purpose of
amendment
Article 3 Total amount of funds lent and
the limits of individual objects.
Items 1 to 3:omitted
4. The Company shall not be
subject to the restrictions in the
preceding paragraph, but the
amount of individual loans
shall not exceed 7.5 times the
net worth of the lending
company, the total amount of
loans shall not exceed 15 times
the net worth of the lending
company, and the loan period
shall not exceed 15 years.		 Total amount of funds lent and
the limits of individual objects.
Items 1 to 3:omitted
4. The Company shall not be
subject to the restrictions in the
preceding paragraph, but the
amount of individual loans shall
not exceed 10 times the net
worth of the lending company,
the total amount of loans shall
not exceed 20 times the net
worth of the lending company,
and the loan period shall not
exceed 15 years.		 In order to
conform to
amendments
to related
laws		 
~62~

Appendix 1

The current shares holding of the directors and supervisors

April 18,2021

April 18,2021 April 18,2021
Job title Name Elect Date Term Initial
election date		 H o l d i n g s h a r e s
at the time of election
The shareholders' register as
of the book closure date
Record of shares held
Number of
shares		 Shareholding
ratio		 Number of
shares		 Shareholding
ratio
Chairman Representative of Yingchuan
International Enterprise Co., Ltd.:
Chen Hai-ni		 108.06.19 3 years 1965 19,840,164 19.39% 21,427,377 19.39%
Chairman Representative of Yingchuan
International Enterprise Co., Ltd.:
Lin Shu-hui		 108.06.19 3 years 1965 19,840,164 19.39% 21,427,377 19.39%
Chairman Representative of Yingchuan
International Enterprise Co., Ltd.:
Chen Shiyi		 108.06.19 3 years 1965 19,840,164 19.39% 21,427,377 19.39%
Chairman Li Baoshang 108.06.19 3 years 2007 79,602 0.08% 85,970 0.08%
Independent
director		 Lu Guoying 108.06.19 3 years 2019 14,765 0.01% 15,946 0.01%
Independent
director		 Li TeJu 108.06.19 3 years 2016 0 0% 0 0%
Independent
director		 Li Chingling 108.06.19 3 years 2019 0 0% 0 0%

  1. The paid-in capital of the company is NT$1,104,855,380 number of shares issued is 110,485,538

  2. 2.According to Article 26 of the Securities and Exchange Act, all directors shall hold a minimum of 8,000,000 shares, and all supervisors shall hold a minimum of 800,000 shares

3.The numbers of shares, which must reached the statutory standard, held by the directors and supervisors individually and by the entire bodies thereof respectively as recorded in the shareholders' register as of the book closure date for that shareholders' meeting. 

~63~

Appendix 2

Other matters

The shareholders meeting, the shareholders’ proposals and nominations and explanations:

Explanation:

  1. In accordance with Article 172 of the Company Act, holding more than one percent of the total number of issued shares, may submit written proposal, but limited to one proposal only, and the proposals are limited to 300 words.

  2. The company's shareholders' meeting this year accepts the application for shareholder proposal, from April 12, 2021 to April 22, 2021, and this is announced on the Market Observation Post System.

  3. 3.The company has not received any shareholder proposals as of the deadline of the proposal. 

~64~

before amendment

Appendix 3

Hotel Holiday Garden The company's ethical behavior criteria

Purpose

  • Article 1:For the purpose of encouraging company personnel to act in line with ethical standards, and helping interested parties better understand the ethical standards of the company, the code of ethical conduct is established with reference to the “Guidelines for the Adoption of Codes of Ethical Conduct for TWSE/GTSM Listed Companies”

Applicable objects

  • Article 2:This Code is applicable to “persons of the company”, including directors, supervisors, managers and all employees of the company.

Standards of Ethical Conduct

  • Article 3:Employees of the compan shall, when acting in their

  • respective capacities, adopt a positive and responsive attitude,avoid parochialism, promote the spirit of team work, and strictly comply with truthful and fiduciary duty.

  • Article 4:Employees of the companyshall perform their duties in an objective and efficient manners and shall be prohibited from taking advantage of their position in the comapny to obtain improper benefits for either themselves or their spouse, parents, children, or relatives within the third degree of kinship.

  • When aforementioned persons engage in loans of funds, provisions of guarantees and major asset transactions or the purchase or sale of goods involving the affiliated companies at which a director, supervisor, or managerial officer works, those directors, supervisors, and managerial officers shall voluntarily explain whether there is any potential conflict between them and the company.

  • Article 5:Employees of the company shall not engage in any of the following activities:

  • (1) attempt to obtain or obtain personal gain by using the company property of information or taking advantage of theirs positions.

  • (2) other company competing with the company, except for

    • Those who have been approved by the shareholders' meeting to remove the limt of competition.

  • (3)Behaviors prohibited by the company's code of ethics or other relevant regulations. 

~65~

Confidentiality

  • Article 6:Employees of the company shall be bound by the obligation to maintain the confidentiality of any information regarding the company itself or its suppliers and customers, except when authorized or required by law to disclose such information. Confidential information includes any undisclosed information that, if exploited by a competitor or disclosed, could result in damage to the company or the suppliers and customers.

Fair trade

  • Article 7:Employees of the company shall treat all suppliers and customers fairly, and may not obtain improper benefits through manipulation, nondisclosure, or misuse of the information learned by virtue of their positions, or through misrepresentation of important matters, or through other unfair trading practices.

  • The employees of the company, when acting in their respective capacities, shall not request, offer, deliver or receive gift, service, kickback, bribe or other improper benefits in any kind for themselves, the company or any other third parties, unless those gifts or service requested, offered, delivered, or received are in accordance with societal customs or permitted by the company.

  • Article 8:Employees of the company have the responsibility to safeguard company assets and to ensure that they can be effectively and lawfully used for official business purposes. On theother hand, all employees of the company shall be preventive any theft, negligence in care, or waste of the assets.

Legal Compliance

  • Article 9:Employees of the company shall act in compliance with the Company Act, the Securities and Exchange Act, and other applicable laws, regulations, and by law concerning the company business activities.

Report on illegal or unethical activities

  • Article 10:The company shall handle the education and promotion of this code for its personnel.

  • Employees to report to a company the company's directors, managerial officer, chief internal auditor, or other appropriate individual upon suspicion or discovery of any activity in violation of a law or regulation or the code of ethical conduct. The company shall ensure that information reported according to the preceding paragraph will be treated as confidential and take necessary measures to protect the safety of the good-faith informants. 

~66~

Disciplinary measures

  • Article 11:When employees of the company violates the code of ethical conduct, the company shall handle the matter in accordance with the disciplinary measures prescribed in the code, and shall without delay disclose on the Market Observation Post System (MOPS) the date of the violation by the violator, reasons for the violation, the provisions of the code violated, and the disciplinary actions taken. It is advisable that the company establish a relevant complaint system to provide the violator with remedies.

Procedures for exemption

  • Article 12:The code of ethical conduct adopted by a company must require that any exemption for employees of the company, from compliance with the code be adopted by a resolution of the board of directors, and that information on the date on which the board of directors adopted the resolution for exemption, objections or reservations of independent directors, and the period of, reasons for, and principles behind the application of the exemption be disclosed without delay on the MOPS, in order that the shareholders may evaluate the appropriateness of the board resolution to forestall any arbitrary or dubious exemption from the code, and to safeguard the interests of the company by ensuring appropriate mechanisms for controlling any circumstance under which such an exemption occurs.

Method of disclosure

  • Article 13:A TWSE or TPEx listed company shall disclose the code of ethical conduct it has adopted, and any amendments to it, on its company website, in its annual reports and prospectuses and on the MOPS.

Enforcement

  • Article 14.:This code will be announced and implemented after approval by the board of directors; the same applies when revised.

  • If the company has set up independent directors,the codes of ethical conductshall be discuss by Board of Directors.The Board of Directors 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 of directors meeting. If independent directors are unable to attend the board of directors in person that to express objections or reservations of they. They shall issue written opinions in advance and include them in the minutes of the board of directors unless they have legitimate reasons.

If the company establishes an audit committee, the regulations on supervisors in this Code shall be used by the audit committee mutatis mutandis. 

~67~

Established and revised date

Article 15 This code was established on March 20, 2019 

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Appendix 4 before amendment

Hotel Holiday Garden

Regulations Governing Procedure for Board of Directors Meetings

  • Article 1:To establish a strong governance system and sound supervisory capabilities for this Corporation's board of directors meetings, and to strengthen management capabilities, these Rules are adopted pursuant to Article 2 of the "Regulations Governing Procedure for Board of Directors Meetings of Public Companies".

  • Article 2:The procedure for board of directors meetings of this Corporation; the main agenda items, operational procedures, required content of meeting minutes, public announcements, and other compliance requirements for board meetings shall be handled in accordance with these Regulations.

Article 3: (Board convocation and meeting notice)

A board of directors shall meet at least quarterly.

The reasons for calling a board of directors meeting shall be notified to each director at least seven days in advance. In emergency circumstances, however, a meeting may be called on shorter notice.

The notice cna written form, by e-mail, or by fax.

All matters set out in the subparagraphs of Article 12, paragraph 1, shall be specified in the notice of the reasons for calling a board of directors meeting; none of them may be raised by an extraordinary motion except in the case of an emergency or legitimate reason.

Article 4: (Meeting notice and meeting materials)

The agenda working group designated by the Company is Financial Department.

The agenda working group shall prepare agenda items for board of directors meetings and provide comprehensive pre-meeting materials, to be sent together with the notice of the meeting. A director of the opinion that the pre-meeting materials provided are insufficiently comprehensive may request the agenda working group to supplement the materials. If a director is of the opinion that materials concerning any proposal are insufficient in content, the deliberation of such proposal may be postponed by a resolution of the board of directors.

  • Article 5: (Preparation of attendance book and other documents and entrusted attendance of directors)

When a meeting of the board of directors is held, an attendance book shall be made ready for signature by directors attending the meeting and thereafter made 

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available for future reference.

All board directors shall attend board meetings in person; if attendance in person is not possible, they may, pursuant to the company's articles of incorporation, appoint another director to attend as their proxy. Attendance via tele- or video-conference is deemed as attendance in person.

A director appointing another director to attend a board meeting in his or her place shall in each case give to that director a written proxy stating the scope of authorization with respect to the reasons for meeting.

A proxy under paragraph 2 may accept a proxy from one person only.

Article 6:(Principle of meeting place and time of the board of directors)

A board of directors meeting shall be held at the location and during the business hours of the Company, or at a place and time convenient to all directors and suitable for holding such a meeting.

Article 7:(Chairman of the Board and Deputy)

Where a meeting of the board of directors is called by the chairperson of the board, the meeting shall be chaired by the chairperson. However, where the first meeting of each newly elected board of directors is called by the director who received votes representing the largest portion of voting rights at the shareholders' meeting in which the directors were elected, the meeting shall be chaired by that director; if there are two or more directors so entitled to call the meeting, they shall choose one person by and from among themselves to chair the meeting.

When the chairperson of the board is on leave or for any reason is unable to exercise the powers of the chairperson, the vice chairperson shall do so in place of the chairperson, or, if there is no vice chairperson or the vice chairperson also is on leave or for any reason is unable to act, by a managing director designated by the chairperson, or, if there is no managing director, by a director designated thereby, or, if the chairperson does not make such a designation, by a managing director or director elected by and from among themselves.

Article 8:(board of directors meetings of relevant information, attendees)

When the board of directors of the Company holds a meeting, the Manager and Financial Department shall prepare relevant information for the directors' reference at the meeting.

When holding a meeting of the board of directors, the Company may, as necessary for the agenda items of the meeting, notify personnel of relevant departments or subsidiaries to attend the meeting participants.

When necessary, the Company may also invite accountant, attorneys, or other professionals to attend as nonvoting participants and to make explanatory statements, provided that they shall leave the meeting when deliberation or voting 

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takes place.

The chairman of the board of directors shall call the meeting to order when a majority of the directors are present at the time of the meeting. When the time of a meeting has arrived and one-half all board directors are not present, the meeting chair may announce postponement of the meeting time, provided that only two postponements may be made. Besideshe the total delay time cannot exceed one hour.If the quorum is still not met after two such delays, the chair shall re-call the meeting following the procedures provided in Article 3, paragraph 2.

The term "all board directors " as used in the preceding paragraph, paragraph 2, subparagraph 2 shall be calculated as the number of directors then in office

Article 9:(video recording of board meeting process)

A company shall record on audio or video tape the entire proceedings of a board of directors meeting, and preserve the recordings for at least five years, in electronic form or otherwise.

If before the end of the preservation period referred to in the preceding paragraph any litigation arises in connection with a resolution of a board of directors meeting, the relevant audio or video recordings shall continue to be preserved until the litigation is concluded.

Where a board of directors meeting is held via tele- or video conferencing, the audio and visual documentation of the meeting form a part of the meeting minutes and shall be well preserved during the existence of the company.

Article 10:(Contents of the meeting)

Agenda items for regular board of directors meetings shall include at least the following:

1.Reports:

(1)Minutes of the last meeting and actions arising.

(2)Reporting on important financial and business matters.

(3)Reporting on internal audit activities.

(4)Other important matters to be reported.

  • 2.Discussions:

(1)Items discussed and continued from the last meeting.

(2)Items for discussion at this meeting.

  • 3.Extraordinary motions. 
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Article 11:(discussion of meeting)

A board of directors meeting shall be conducted in accordance with the order of business on the agenda as specified in the meeting notice. However, the order may be changed with the approval of a majority of directors present at the meeting.

The meeting chair may not declare the meeting closed without the approval of a majority of directors present at the meeting.

If at any time during the proceeding of a board of directors meeting the directors sitting at the meeting are not more than half of the directors present at the meeting, then upon motion by the directors sitting at the meeting, the chair shall declare a suspension of meeting, in which case paragraph 3 of the preceding article 8 shall apply mutatis mutandis.

Article 12:(discussion by the board of directors)

A company shall submit the following items for discussion by the board of directors:

  • 1.Corporate business plan.

  • 2.Annual and semi-annual financial reports, with the exception of semi-annual financial reports which, under relevant laws and regulations, need not be audited and attested by a certified public accountant (CPA).

  • 3.Adoption or amendment of an internal control system pursuant to Article 14-1 of Securities and Exchange Act, and an assessment of the effectiveness of the internal control system.

  • 4.Adoption or amendment, pursuant to Article 36-1 of Securities and Exchange Act, of handling procedures for financial or operational actions of material significance, such as acquisition or disposal of assets, derivatives trading, extension of monetary loans to others, and endorsements or guarantees for others.

  • 5.The offering, issuance, or private placement of any equity-type securities.

  • 6.The appointment or discharge of a financial, accounting, or internal audit officer.

  • 7.A donation to a related party or a major donation to a non-related party, provided that a public-interest donation of disaster relief for a major natural disaster may be submitted to the following board of directors meeting for retroactive recognition.

  • 8.Any matter required by Article 14-3 of Securities and Exchange Act or any other law, regulation, or bylaw to be approved by resolution at a shareholders' meeting or board of directors meeting, or any such significant matter as may be prescribed by the competent authority. 

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  1. The remuneration of directors and managers shall be discussed and decided by the board of directors after the remuneration committee makes recommendations.

If the board of directors will decline to adopt, or will modify, a recommendation of the remuneration committee, it shall require the consent of a majority of the directors in attendance at a meeting attended by two-thirds or more of the entire board, which in its resolution shall give the comprehensive consideration under the preceding paragraph and shall specifically explain whether the remuneration passed by it exceeds in any way the recommendation of the remuneration committee.

If the remuneration passed by the board of directors exceeds the recommendation of the remuneration committee, the circumstances and cause for the difference shall be specified in the board meeting minutes, and shall be publicly announced and reported on the information reporting website designated by the competent authority within 2 days counting from the date of passage by the board of directors.

The term "related party" in subparagraph 7 of the preceding paragraph means a related party as defined in the Regulations Governing the Preparation of Financial Reports by Securities Issuers. The term "major donation to a non-related party" means any individual donation, or cumulative donations within a 1-year period to a single recipient, at an amount of NTD100 million or more, or at an amount equal to or greater than 1 percent of net operating revenue or 5 percent of paid-in capital as stated in the CPA-attested financial report for the most recent year.

The term "within a 1-year period" in the preceding paragraph means a period of 1 year calculated retroactively from the date on which the current board of directors meeting is convened. Amounts already submitted to and passed by a resolution of the board aren't included.

If a company has an independent director or directors, at least one independent director shall attend each meeting in person. In the case of a meeting concerning any matter required to be submitted for a resolution by the board of directors under paragraph 1, each independent director shall attend in person; if an independent director is unable to attend in person, he or she shall appoint another independent director to attend as his or her proxy. If an independent director expresses any objection or reservation about a matter, it shall be recorded in the board meeting minutes. An independent director intending to express an objection or reservation but unable to attend the meeting in person shall, unless there is some legitimate reason to do otherwise, issue a written opinion in advance, which shall be recorded in the meeting minutes. 

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Article 13:(voting)

When the chair at a board of directors meeting is of the opinion that a matter has been sufficiently discussed to a degree of putting to a vote, the chair may announce the discussion closed and bring the matter to vote.

When a proposal comes to a vote at a board of directors meeting, if the chair puts the matter before all directors present at the meeting and none voices an objection, the matter is deemed approved.

When there is any objection, a vote shall be held. The meeting chair shall choose one of the following voting methods, except that if there is any voice of objection in the meeting, the meeting chair shall seek a majority vote.

  1. Voting by show of hands or by electronic voting

  2. Roll-call voting

  3. Voting by ballot

  4. Voting at the Company's option

Article 14:(voting, way of scrutiny and counting)

Except as otherwise stated in Securities and Exchange Act or in the Company Act, a resolution on a matter at a board of directors meeting requires the approval of a majority of the directors present at the meeting that shall be attended by a majority of all directors.

If there is an amendment to or substitute for the same motion, the meeting chair shall determine the order of voting on the same motion together with the original motion. However, if one of the motions has been passed, the other motions shall be considered as rejected and need not be voted on again. If it is necessary to have a vote monitoring and vote counting personnel, the meeting chair shall designate such personnel, but the vote monitoring personnel shall also be a director. The results of voting shall be reported and recorded in the minutes.

Article 15:(Director’s benefit avoidance system)

If any director or a juristic person represented by a director is an interested party with respect to any agenda item, the director shall state the important aspects of the interested party relationship at the respective meeting. When the relationship is likely to prejudice the interests of the Company, the director may not participate in discussion or voting on that agenda item, and further, shall enter recusal during discussion and voting on that item and may not act as another director's proxy to exercise voting rights on that matter.

The provisions of Article 180, paragraph 2 of the Company Act, as applied mutatis mutandis under Article 206, paragraph 2 of that Act, apply to resolutions of board of directors meetings when a director is prohibited by the preceding two paragraphs from exercising voting rights. 

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Article 16:(Meeting discussions and signing matters)

  • Minutes shall be prepared of the discussions at board of directors meetings. The meeting minutes shall record the following:

  • 1.Session (or year), time, and place of meeting.

  • 2.Name of the meeting chair.

  • 3.Attendance of directors at the meeting, specifying the names and number of members present, excused, and absent.

  • 4.Names and titles of those attending the meeting as nonvoting participants.

  • 5.Name of minutes taker.

  • 6.Matters reported on.

  • 7.Agenda items: the method of resolution and the result for each proposal; a summary of the comments made by directors, supervisors, experts, or other persons; the name of any director that is an interested party as referred to in paragraph 1 of the preceding article, an explanation of the important aspects of the relationship of interest, the reasons why the director was required or not required to enter recusal, and the status of their recusal; opinions expressing objections or reservations at the meeting that were included in records or stated in writing; and any opinion issued in writing by an independent director under Article 12, paragraph 7.

  • 8.Extraordinary motions: the name of the mover; the method of resolution and the result for each motion; a summary of the comments made by directors, supervisors, experts, or other persons; the name of any director that is an interested party as referred to in paragraph 1 of the preceding article, an explanation of the important aspects of the relationship of interest, the reasons why the director was required or not required to enter recusal, and the status of their recusal; opinions expressing objections or reservations at the meeting that were included in records or stated in writing.

  • 9.Other matters required to be recorded.

  • The attendance book forms a part of the minutes for each board of directors meeting and shall be well preserved during the existence of the company.

  • The minutes of a board of directors meeting shall bear the signature or seal of both the meeting chair and the minutes taker; a copy of the minutes shall be distributed to each director and supervisor within 20 days after the meeting and well preserved as important company records during the existence of the company.

The production and distribution of the meeting minutes referred to in paragraph 1 may be done in electronic form. 

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Article 17:( The authorization principle of the board of directors)

  • In addition to the matters that shall be referred to the board of directors of the Company for discussion in the first paragraph of Article 12, where the board of directors is authorized to exercise the powers and functions of the board of directors in accordance with the law or the provisions of the Articles of Incorporation of the Company, the level and contents of such authorization shall be specific and clear, and the contents or matters of such authorization shall be as follows:

  • (1) The company shall report to the board of directors for ratification afterwards for regulations governing loaning of funds and endorsement and guarantees of subsidiaries.

  • (2) The company's loan to financial institutions shall be reported to the board of directors for ratification afterwards.

Article 18:( board of representative directors)

If there is one or more managing director on the board of directors, the provisions of Article 2, paragraph 2 of Article 3, Articles 4 to 6, Articles 8 to 11, and Article 13 to 16.

Article 19:These Regulations of Procedure shall be approved by the board of directors of the Company and reported to the shareholders meeting. Any future amendments shall be authorized to be approved by the board of directors. 

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Appendix 5 before amendment

Hotel Holiday Garden

Procedures for Election of Directors

Article 1:To ensure a just, fair, and open election of directors, these Procedures are adopted pursuant to Articles 21 and 41 of the Corporate Governance Best-Practice Principles for TWSE/GTSM Listed Companies.

  • Article 2:Except as otherwise provided by law and regulation or by this Corporation's articles of incorporation, elections of directors shall be conducted in accordance with these Procedures.

  • Article 3:The overall composition of the board of directors shall be taken into consideration in the selection of this Corporation's directors. The composition of the board of directors shall be determined by taking diversity into consideration and formulating an appropriate policy on diversity based on the company's business operations, operating dynamics, and development needs. It is advisable that the policy include, without being limited to, the following two general standards: Basic requirements and values: Gender, age, nationality, and culture. Professional knowledge and skills:A professional background (e.g., law, accounting, industry, finance, marketing, technology), professional skills, and industry experience.

Each board member shall have the necessary knowledge, skill, and experience to perform their duties; the abilities that must be present in the board as a whole are as follows:

  • 1.The ability to make judgments about operations.

  • 2.Accounting and financial analysis ability.

  • 3.Business management ability.

  • 4.Crisis management ability.

  • 5.Knowledge of the industry.

  • 6.An international market perspective.

  • 7.Leadership ability.

  • 8.Decision-making ability.

More than half of the directors shall be persons who have neither a spousal

relationship nor a relationship within the second degree of kinship with any other director.

The board of directors of this Corporation shall consider adjusting its composition based on the results of performance evaluation. 

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  • Article 4:The qualifications for the independent directors of this Corporation shall comply with Articles 2, 3, and 4 of the Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies. The election of independent directors of this Corporation shall comply with Articles 5, 6, 7, 8, and 9 of the Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies, and shall be conducted in accordance with Article 24 of the Corporate Governance Best-Practice Principles for TWSE/GTSM Listed Companies.

  • Article 5:Elections of both directors at the Company shall be conducted in accordance with the candidate nomination system and procedures set out in Article 192-1 of the Company Act.The Company shall review the qualifications, education, working experience, background, and the existence of any other matters set forth in Article 30 of the Company Act with respect to nominee directors and may not arbitrarily add requirements for documentation of other qualifications. It shall further provide the results of the review to shareholders for their reference, so that qualified directors and supervisors will be elected.

  • When the number of directors falls below seven due to the dismissal of a director for any reason, the Company shall hold a by-election to fill the vacancy at its next shareholders meeting. When the number of directors falls short by one third of the total number prescribed in the Company’s articles of incorporation, the Company shall call a special

  • shareholders meeting within 60 days from the date of occurrence to hold a by-election to fill the vacancies.

  • When the number of independent directors falls below that required under the proviso of Article 14-2, paragraph 1 of the Securities and Exchange Act, or the related provisions of the Taiwan Stock Exchange Corporation rules governing the review of listings, a by-election shall be held at the next shareholders meeting to fill the vacancy. When the independent directors are dismissed en masse, a special shareholders meeting shall be called within 60 days from the date of occurrence to hold a by-election to fill the vacancies.

  • Article 6:The cumulative voting method shall be used for election of the directors at this Corporation. Each share will have voting rights in number equal to the directors to be elected, and may be cast for a single candidate or split among multiple candidates.

  • Article 7:The board of directors shall prepare separate ballots for directors in numbers corresponding to the directors or supervisors to be elected. The number of voting rights associated with each ballot shall be specified on the ballots, which shall then be distributed to the attending shareholders at the shareholders meeting. 

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Attendance card numbers printed on the ballots may be used instead of recording the names of voting shareholders.

  • Article 8:The number of directors will be as specified in this Corporation's articles of incorporation, with voting rights separately calculated for independent and non-independent director positions. Those receiving ballots representing the highest numbers of voting rights will be elected sequentially according to their respective numbers of votes. When two or more persons receive the same number of votes, thus exceeding the specified number of positions, they shall draw lots to determine the winner, with the chair drawing lots on behalf of any person not in attendance.

  • Article 9:Before the election begins, the chair shall appoint a number of persons with shareholder status to perform the respective duties of vote monitoring and counting personnel. The ballot boxes shall be prepared by the board of directors and publicly checked by the vote monitoring personnel before voting commences.

  • Article 10:If a candidate is a shareholder, a voter must enter the candidate's account name and shareholder account number in the "candidate" column of the ballot; for a nonshareholder, the voter shall enter the candidate's full name and identity card number.However, when the candidate is a governmental organization or juristic-person shareholder, the name of the governmental organization or juristic-person shareholder shall be entered in the column for the candidate's account name in the ballot paper, or both the name of the governmental organization or juristic-person shareholder and the name of its representative may be entered. When there are multiple representatives, the names of each respective representative shall be entered.

  • Article 11:A ballot is invalid under any of the following circumstances:

  • 1.The ballot was not prepared by the board of directors

  • 2.A blank ballot is placed in the ballot box

  • 3.The writing is unclear and indecipherable or has been altered

  • 4.The candidate whose name is entered in the ballot is a shareholder, but the candidate's account name and shareholder account number do not conform with those given in the shareholder register, or the candidate whose name is entered in the ballot is a non-shareholder, and a cross-check shows that the candidate's name and identity card number do not match

  • 5.Other words or marks are entered in addition to the candidate's account name or shareholder account number (or identity card number) and the number of voting rights allotted. 

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  • 6.The name of the candidate entered in the ballot is identical to that of another shareholder, but no shareholder account number or identity card number is provided in the ballot to identify such individual

  • Article 12:The voting rights shall be calculated on site immediately after the end of the poll, and the results of the calculation, including the list of persons elected as directors and the numbers of votes with which they were elected, shall be announced by the chair on the site.

  • The ballots for the election referred to in the preceding paragraph shall be sealed with the signatures of the monitoring personnel and kept in proper custody for at least one year. If, however, a shareholder files a lawsuit pursuant to Article 189 of the Company Act, the ballots shall be retained until the conclusion of the litigation.

  • Article 13:The board of directors of this Corporation shall issue notifications to the persons elected as directors.

  • Article 14:These Procedures, and any amendments hereto, shall be implemented after approval by a shareholders meeting. 

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Appendix 6 before amendment

Hotel Holiday Garden

Regulations of shareholders’meeting

  • Article 1: Unless otherwise provided by laws and regulations, shareholders’ meetings (the Meeting) of the Company shall be conducted in accordance with the Rules and Procedures of Shareholders’ Meetings (the Rules and Regulations) herein 。

  • Article 2: When the Company holds a shareholders’ meeting, it shall provide the attendance book for the shareholders to sign in, or the attending shareholders will submit the sign-in card instead of signing in. The number of attending shares will be calculated base on the signature book or the signed card.

  • Article 3: The attendance and voting of the shareholders' meeting shall be calculated based on the number of shares. If the shareholders propose to count the number of votes, the chairman shall not accept the case.

  • Article 4:The venue for a shareholders meeting shall be the premises of the Company, or a place easily accessible to shareholders and suitable for a shareholders meeting. The meeting may begin no earlier than 9 a.m. and no later than 3 p.m.

  • Article 5: The chairman of the shareholders' meeting is aware of the provisions of Article 182 of the Company Act.

  • Article 6: The company may assign company appointed lawyer, an accountant or relevant personnel to attend the shareholders' meeting. Staff handling administrative affairs of a shareholders meeting shall wear identification cards for identification.

  • Article 7: The Company shall tape or video record the entire process of the shareholders’ meeting, and keep it for at least a year.

  • Article 8:The chairman shall call the Meeting to order at the time scheduled for the Meeting. If the number of shares represented by the shareholders present at the Meeting has not yet constituted a majority at the time scheduled for the Meeting, the chairman may postpone the time for the Meeting. The postponement shall be limited to two times at the most and the total time of postponement shall not exceed one hour. If after two postponements no majority can yet be constituted but the shareholders present at the Meeting represent more than one-third of the total outstanding shares, tentative resolutions may be made in accordance with paragraph 1 of Article 175 of the Company Act, unless otherwise provided by other laws and regulations. 

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If during the process of the Meeting the number of outstanding shares represented by the shareholders present becomes sufficient to constitute a majority, the chairman may submit the tentative resolutions to the Meeting for approval in accordance with Article 174 of the Company Act.

  • Article 9: The Meeting agenda shall be set by the board of directors if the Meeting is convened by the board of directors.

  • Unless otherwise resolved at the meeting, the Meeting shall proceed in accordance with the agenda.

  • If the Meeting is convened by any other person(s), the person(s) shall set the agenda, and the preceding paragraph applies. Unless otherwise resolved at the Meeting,the chairman cannot announce adjournment of the Meeting before the proceedings on the agenda are resolved. In the event that the chairman adjourns the Meeting in violation of the Rules and Procedures, the shareholders may designate, by a majority of votes represented by shareholders attending the Meeting, one person as chairman to continue the Meeting.

  • After the meeting is adjourned, the shareholders may not elect another chairman to continue the meeting at the original site or at another location.

  • Article 10: When a shareholder present at the Meeting wishes to speak, a speech request form shall be filled out with a summary of the speech, the meeting attendance card number, and the name of the shareholder. The sequence of speeches by shareholders shall be decided by the chairman.

  • If any shareholder present at the Meeting submits a speech request form but does not speak, no speech shall be deemed to have been made by the shareholder. In case the contents of the speech of a shareholder are inconsistent with the contents of the speech request form, the contents of actual speech shall prevail.

  • Unless otherwise permitted by the chairman and the shareholder in speaking, no shareholder shall interrupt the speeches of the other shareholders, otherwise the chairman shall stop such interruption.

  • Shareholders’ speeches shall be simple and concise, a shareholder shall not speak more than one time for one motion without prior consent from the chairman, and each speech shall not exceed 3 minutes. 

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If a shareholder violates the preceding article or his or her speech exceeds the scope of the motion, the chairman may stop him or her from doing so or other appropriate disposition.

  • Article 11 ： Without chairman’s permission ,every shareholder couldn’t speak over one time ,either over three minutes.If the shareholder violate the regulation,the chairman can restrain the speech.

  • Article 12: Any legal entity designated as proxy by a shareholder(s) to be present at the Meeting may appoint only one representative to attend the Meeting. If a corporate shareholder designates two or more representatives to attend the Meeting, only one representative can speak for each discussion item

  • Article 13: After the speech of a shareholder, the chairman may respond himself/herself or appoint an appropriate person to respond.

  • Article 14: Reporting on matters not to be discussed or voted, the chairman may announce to end the discussion of any resolution and go into voting if the Chairman deems it appropriate.

  • Article 15: The person(s) to check and the person(s) to record the ballots or election matter during a vote by casting ballots shall be appointed by the chairman. The person(s) checking the ballots shall be a shareholder(s).

  • Article 16: During the Meeting, the chairman may, at his discretion, set time for intermission. In case of incident of force majeure, the chairman may decide to temporarily suspend the Meeting and announce, depending on the situation,when the Meeting will resume .

  • Article 17: Except otherwise specified in the related law or the Articles of Incorporation of the Company, a resolution shall be adopted by a majority of the votes represented by the shareholders present at the Meeting.

  • In the resolution, if the chairman of the meeting inquires and receives no objection, the motion is deemed passed, with equivalent force as a resolution by vote.

  • Article 18: If there is amendment to or substitute for a discussion item, the chairman shall decide the sequence of voting for such discussion item, the amendment or the substitute.

If any one of them has been adopted, the others shall be deemed vetoed and no further voting is necessary 。

  • Article 19: The chairman may conduct the disciplinary officers or the security guard to assist in keeping order of the Meeting place. Such disciplinary officers or 
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security guards shall wear badges or arm bands marked "Disciplinary Officers" for identification purpose. 。

Article 20: These Rules and Procedures shall be effective from the date it is approved by the Shareholders' Meeting. The same applies in case of revision. 

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Appendix 7 before amendment

Hotel Holiday Garden Regulations Governing Loaning of Funds

I. Subject ：

These Regulations are promulgated pursuant to Article 36-1 of the Securities and Exchange Act.

A public company shall comply with these Regulations when making loans to others; provided, where financial laws or regulations provide otherwise, such provisions shall govern.

Ⅱ. Content：

Article 1： Entities to which the company may loan funds：

  • (1) Companies that have a business relationship with the Company.

  • (2) Where an inter-company or inter-firm short-term financing facility is necessary, provided that such financing amount shall not exceed 40% of the lender's net worth.

The term "short-term" as used in the preceding paragraph is a time period of one year. Where the Company's operating cycle exceeds one year, the term of “short-term” means one operating cycle. The term "financing amount" as used in Subparagraph 2 of this Article means the cumulative balance of the Company's short-term financing.

The company's direct and indirect holding of 100% of the voting shares of foreign companies engaged in capital lending, or the company's direct and indirect holding of 100% of the voting shares of foreign companies engaged in capital lending to the company, is not subject to the restrictions of paragraph 2 of this Article.

When a responsible person of a company violates paragraph 1 or the proviso of the preceding paragraph, the responsible person shall bear joint and several liability with the borrower for repayment; if the company suffers damage, the responsible person also shall be liable for damages.

Article 2：The reason and necessity of lending funds to others：

Where funds are lent to a company or business with business relationships with the Company, such loans shall be granted in accordance with Paragraph 2 of Article 3. Loans may be granted due to short-term financing need only under one of the following circumstances: 

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1.A Subsidiary of the Company of which the Company holds 50% or more of its shares having a business need for short-term financing.

2.Where short-term financing is required for a company or business due to purchase of materials or operational needs.

3.Where the loan is approved by the Board of Directors of the Company.

  • Article 3：The aggregate amount of loans and the maximum amount permitted to a single borrower：

  • 1.The accumulated total of loans granted shall not exceed 40% of the net worth of the Company.

  • 2.The amount of an individual loan granted by the Company to a company or business with business relationship with the Company shall not exceed the business transaction amount between the parties. “Business transaction amount” refers to the amount of purchase or sale between the parties, whichever is higher.Where funds are lent to a company or business with business relationship, the accumulated amount of such loan shall not exceed 10% of the net worth of the Company.

  • 3.Where funds are lent to a company or business with a short-term financing need, the accumulated amount of such loans shall not exceed 20% of the net worth of the Company.

  • 4.Each inter-company loan of funds between foreign companies in which the Company holds, directly or indirectly, 100% of the voting shares shall not exceed 7.5 times of the net worth of the company.

  • The accumulated total of loans granted shall not exceed 15 times of the net worth of the company,y, and the loan period shall not exceed 15 years.

Article 4：Procedures for handling loans of funds：

  • 1.Credit Investigation：

To apply for loans, the borrower shall provide company information and financial information and apply to the Company for the loan by written form. Upon acceptance of the application, the finance department shall conduct an investigation, evaluating the borrower’s financial condition, debt-paying ability and credit, and earning power and purpose, and draft a report. The accounting department shall conduct an investigation against the borrower and do a thorough evaluation; assessments shall at least include the following:

  • (1)The necessity and reasonableness of extending loans to others.

  • (2)Whether the amount of loan to be extended is necessary considering the 

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financial status of the borrower.

  • (3)Whether the accumulated loan amount is within the limit.

  • (4)Impact on the Company’s operation, financial condition and shareholders’ equity.

  • (5)Whether collateral must be obtained and the appraised value thereof.

(6)Borrowers’ credit status and risk assessment record shall be attached

  1. Preservation：

When handling capital loans and matters, the company shall obtain a security note of the same amount and, if necessary, handle the mortgage setting of movable or immovable property. In the case of the prior claim guarantee, the debtor provides an individual or company that provides considerable capital and credit as a guarantee, the board of directors shall consider the credit report of the finance department. If the company is the guarantee, pay attention to whether its articles of association are stipulated may be a guarantee clause.

  1. The scope of authorization：

The Company handles capital loans and matters, then the company's finance department credit, and submit to the general manager for verification and to the board of directors for approval.The Company shall not empower any other person to make such a decision.

Lending between the Company and its subsidiaries, or between other subsidiaries, shall submit to the board of directors for approval. , and the Chairman shall be authorized to handle the matter within the specific amount of fund lending to the same party approved by the Board of Directors and the lending is authorized in installment or revolver within one year.

"Specific amount" as referred to above shall mean that the authorized amount of loans by the Company to an individual entity shall not exceed 20% of the Company’s net value in their most recent financial statement except loans between the Company's Subsidiaries outside of Taiwan of whom the Company directly or indirectly holds 100 percent of voting shares.

The Board of Directors shall take into full consideration each independent director's opinion; independent directors' opinions specifically expressing assent or dissent and their reasons for dissent shall be included in the minutes of the Board of Directors' meeting

Article 5：Duration of loans and calculation of interest:

  • 1.The term of each loan extended by the Company shall not exceed one year. Under any special circumstance, the term may be extended if approved by the board of directors in consideration of business needs. 
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  1. The interest rate shall not be lower than the short-term lending rate offered by the bank on the date the loan is borrowed. The calculation of the Company’s interest shall be collected once per month in principle.Under any special circumstance, the interest can be adjusted according to the actual situation after the approval of the board of directors.

  2. Article 6：Subsequent measures for management of loans, and procedures for handling delinquent creditor’s rights:

  3. After the advance of payment, the Company shall constantly pay attention to the financial status and business condition as well creditability of the borrower and its guarantor. If collateral is provided, the Company shall also pay attention to any changes to the value of such collateral. In case of major changes, the chairman of the board shall be notified immediately, and the instructions shall be dealt with appropriately.

  4. 2.Upon maturity of the loan, the borrower shall first calculate interest payable and repay together with the principal, before the Company may discharge the collateralized debt obligation of the promissory note and IOU and return to the borrower.

  5. 3.At maturity, the borrower shall repay the principal and interest. In the event the borrower is unable to repay and requires extension, such borrower shall submit its request in advance and the same shall submit to the board of directors for approval. The extension of each repayment shall not exceed three (3) months and shall be a one-time extension. In the event of violation, the Company may directly punish such Borrower and seek compensation.

Article 7：Internal control：

  • 1.Company shall establish and maintain a memorandum book for its fund-loaning activities and truthfully record the following information: borrower, amount, date of approval by the Board of Directors, lending/borrowing date, and matters to be carefully evaluated under the preceding Article.

  • 2.Internal auditors shall perform auditing on the Procedures and the implementation of the Procedures every quarter and produce written auditing reports. Should there be any violation found, a written report is needed to notify the Audit Committee and the Board of Directors.Should there be any violation found, the manager and organizer shall be punished according to the violation. 

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  • 3.Should a borrower no longer satisfy the criteria set forth in the relevant regulations and/or the Procedures or there be any excess over the lending limit due to unexpected changes of the Company, a corrective plan has to be provided to the Audit Committee, and the proposed correction actions should be implemented within the period specified in such plan.

Article 8：Announcement and Report：

  • 1.The Company shall announce and report the previous month's loan balances of its head office and Subsidiaries by the 10th day of each month.

  • 2.The Company whose loans of funds reach one of the following levels shall announce and report such event within two days commencing immediately from the date of occurrence of the fact:

  • (1)The aggregate balance of loans to others by the Company and its Subsidiaries reaches 20 percent or more of the Company's net worth as stated in its latest financial statement.

  • (2)The balance of loans by the Company and its Subsidiaries to a single enterprise reaches 10 percent or more of the Company's net worth as stated in its latest financial statement.

  • (3)The amount of new loans of funds by the Company or its Subsidiaries reaches NT$10 million or more, and reaches 2 percent or more of the Company's net worth as stated in its latest financial statement.

If there is any reporting and announcement required for the Company's

Subsidiary which is not a domestic public company, the Company will follow the requirement on behalf of its Subsidiary.

Article 9:

  • "Subsidiary" and "parent company" as referred to in the Procedures shall be as determined under the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

The company’s financial report is prepared in accordance with the International Financial Reporting Standards."Net worth" as referred to in the Procedures shall be equity attributable to owners of the parent company in the balance sheet.

Article 10:

The term "Announcement and Report" as used in the Procedures means the process of entering data to the information reporting website designated by the Financial Supervisory Commission of Taiwan.

The term "date of occurrence of the fact" as used in the Procedures refers to the date of contract signing, date of payment, dates of resolutions of the Board of 

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Directors, or other date that can confirm the counterpart and monetary amount of the transaction, whichever date is earlier.

Ⅲ. Others:

  • 1.Where a Subsidiary of the Company proposes to lend funds to a third party, the Company shall require the Subsidiary to establish procedures for lending funds in accordance with relevant regulations and the Procedures and shall conform to such procedures.

  • 2.The Company shall make sufficient provision based on the condition of its lending profile, adequately disclose information in the financial statements, and provide external auditors with necessary information for conducting due auditing.

  • Any other matters not set forth in the Procedures shall be dealt with in accordance with the applicable laws, rules, and regulations and the Company’s relevant regulations.

Ⅳ. Implementation and Revision：

The Procedures and any amendment thereof shall be effective upon approval by the Audit Committee first and then by Board of Directors,submit to the shareholders meeting for approval. Any objection by the Directors which is recorded or in writing shall be submitted to the Audit Committee and for discussion by the Shareholders' Meeting. The same shall apply to any amendments to the Procedures.

The Board of Directors 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 of directors meeting. 

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Hotel Holiday Garden Chairman of the Board: Chen Hai-ni

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