HOLY STONE — AGM Information 2017

Jun 15, 2017

Holy Stone Enterprise Co., Ltd. （ ”Company” ） Minutes of 2017 Annual General Shareholders’ Meeting （Translation）

Time: 09:00 a.m., June 7, 2017

Place: Conference Room at 7[th] floor, No. 17（Chu Pao Building）, Lane 91, Sec. 1, NeiHu Road, Taipei

114, Taiwan

Shareholders Present: Total outstanding shares of the Company are 224,215,398 shares, and shares represented by shareholders present are 148,448,388 shares（including

47,833,472 shares casted electronically）, accounted for 66.2% of total shares issued.

Chairman: Jing-Rong Tang,

Recorder: Jui-Chiung Wang

Directors present: Jing-Rong Tang, Chyang Lo, Yu-Min Wu, Shih-Yun Sheng, Shao-Kuo Huang, Ken-Yi Cheng , Nai-Hua Wu, 100% of the Board of Directors

Supervisors present: Tan-Ming Wu, Chung-Yi Yang, 100% of Supervisors

Attendance (functional Committee): Ken-Yi Cheng and Nai-Hua Wu, 66.67% of the Salary Compensation Committee

Attendance: Ching-Sung Wang, CPA, KPMG

Fitch Shih, Attorney, STRing Law Firm

I.The aggregate shareholding of the shareholders present in person or casted electronically constituted a quorum. The Chairman called the meeting to order.

II.Chairman’s Address: (omitted)

III.Meeting Content:

A. Report Items

• (1) To report the business of 2016. (see attachment 1)

• Summary of shareholders’ Q&A: Shareholder account number 30739 and 124023 asked questions regarding operating performance. Questions were answered by Chairman, Accountant Manager, and CPA, Ching-Sung Wang, designated by Chairman.

• (2) To report Supervisor’s Review Report on the 2016 Financial Statements. (see attachment 2)

• Summary of shareholders’ Q&A: Shareholder account number 30739 and 124023 asked questions regarding financial statements and information transparency to Supervisors. Questions were answered by Supervisors, Chairman, and Accountant Manager designated by Chairman.

• (3) To report the distribution of 2016 employee bonus and Directors and Supervisor remuneration.

• (4) To report amendment to CSR Best Practices. (see attachment 3) Summary of shareholders’ Q&A: Shareholder account number 124023 asked question regarding amendment. Question was answered by Attorney, Fitch Shih, designated by

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Chairman.

• (5) To report amendment to Corporate Governance Best Practice Principles. (see attachment 4)

B. Acknowledgement Items

• (1) Subject: To accept 2016 Business Report and Financial Statements

Description:

• （ I ） 2016 Financial Statement of the Company has been audited, and the audit report has

been issued by Ching-Sung Wang and Pei-Chi Chen, CPA with KPMG.

• （ II ） The 2016 Financial Statements and Business Report are reviewed by Supervisors.

• （ III ） Attachments:

• i. Business Report (see attachment 1)

• ii. Auditors' Report. (see attachment 5 & 6)

• iii. Financial Statement (see attachment 5 & 6)

• iv. Supervisors’ Report (see attachment 2)

• （ IV ） Please accept

Voting Results: Shares represented at the time of voting: 148,448,388

*
Voting Results	% of the total represented share present
Votes in favor : 145,045,042 votes (44,465,012 votes)	97.70%
Votes against : 8,100 votes (8,100 votes)	0.00%
Votes invalid : 0 votes (0 votes)	0.00%
Votes abstained : 3,395,246 votes (3,360,360 votes)	2.28%

• *including votes casted electronically (numbers in brackets)

• RESOLVED, that the 2016 Business Report and Financial Statements were accepted as submitted.

Summary of shareholders’ Q&A: Shareholder account number 30739 and 124023 asked

questions regarding Financial Statements. Questions were answered by Accountant

Manager and CPA, Ching-Sung Wang, designated by Chairman.

• (2) Subject: To approve the proposal for distribution of 2016 profits

• Description:

• （ I ） To draft the distribution of earnings according to Articles of Company (see, attachment 7 ）

• （ II ） The distribution of earnings were reviewed by Supervisors (see, attachment 2 ）

• （ III ） Each shareholder will be entitled to a cash dividend of NT$2.0 per share.

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• （ IV ） Resolution at Shareholders’ Meeting shall authorize the Board of Directors to decide on the Distribution Record Date.

• （ V ） In the event of that the outstanding shares is affected by capital increase (reduction), buyback of treasury stock or, write-off and transfer of treasury stock, conversion of convertible bonds, conduct of ESO or any other factors, authorized Board of Directors shall resolved the total amount of the distribution of earning at the shareholders’ meeting. The distribution shall be adjusted in portion of outstanding shares on the distribution report date.

• （ VI ） Please accept

Voting Results: Shares represented at the time of voting: 148,448,388

*
Voting Results	% of the total represented share present
Votes in favor : 145,043,041 votes (44,463,011 votes)	97.70%
Votes against : 8,101 votes (8,101 votes)	0.02%
Votes invalid : 0 votes (0 votes)	0.00%
Votes abstained : 3,397,246 votes (3,362,360 votes)	2.28%

*including votes casted electronically (numbers in brackets)

RESOLVED, that the distribution of 2016 profits was approved as submitted.

C. Discussion Items

• （ 1 ） Subject: To approve distribution of cash dividend from APIC

Description:

• （ I ） To propose distribution of cash dividend from APIC of NT$ 112,107,699, and each shareholder will be entitled to receive a cash dividend of NT$0.5 per share according to shareholders’ register.

• （ II ） Cash dividend amount will be round off to nearest dollar, and fractional amount will be recognized as Other Income.

• （ III ） After the approval from the Shareholders' Meeting, the Board of Directors will set schedule and timeline for the record date of the capital reduction and that of issuance of new shares.

• （ IV ） In the event of that the outstanding shares is affected by capital increase (reduction), buyback of treasury stock or, write-off and transfer of treasury stock, conversion of convertible bonds, conduct of ESO or any other factors, authorized Board of Directors shall resolved the total amount of the distribution of earning at the shareholders’ meeting. The distribution shall be

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adjusted in portion of outstanding shares on the distribution report date. （ V ） Please jointly decide

Voting Results: Shares represented at the time of voting: 148,448,388

*
Voting Results	% of the total represented share present
Votes in favor : 145,042,731 votes (44,462,701 votes)	97.70%
Votes against : 9,112 votes (9,112 votes)	0.00%
Votes invalid : 0 votes (0 votes)	0.00%
Votes abstained : 3,396,545 votes (3,361,659 votes)	2.28%

• *including votes casted electronically (numbers in brackets)

RESOLVED, that the amendment was approved as proposed.

• （ 2 ） Subject: To approve capital reduction Description:

• （ I ） To reduce share capital and pay it back to shareholders with the aim of improving return on equity and other financial ratios

• （ II ） The amount of capital reduction is NT$ 672,646,190, and the current common capital is 2,242,153,980. The capital reduction ratio is estimated to be 30%, cancelled shares 67,264,619, and share capital after the capital reduction 1,569,507,790 (156,950,779 shares). The actual share capital and capital reduction ratio would be subject to total shares outstanding after the record date.

• （ III ） Total shares cancelled would be 67,264,619, which means 300 shares would be cancelled for every one thousand shares. Odd lots of shares can be put together as round lots after the last date to trade. The rest of the odd lots will be purchased at the closing price from the last date to trade by the authorized person.

• （ IV ） The new shares issued after the capital reduction would be non-physical, but the rights and obligations would be the same as physical ones.

• （ V ） After the approval of this capital reduction from the Shareholders' Meeting and the authorities, the Board of Directors will set schedule and timeline for the record date of the capital reduction and that of issuance of new shares.

• （ VI ） Before the record date, any changes to the capital reduction ratio and the amount returned per share caused by adjustment in regulations or request from the authorities, or in reponse to any other environmental factors, will be brought up at the Shareholders' Meeting and be dealt with by the Chairman of

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the Board.

（ VII ） Please jointly decide

Voting Results: Shares represented at the time of voting: 148,448,388

*
Voting Results	% of the total represented share present
Votes in favor : 144,989,120 votes (44,409,090 votes)	97.66%
Votes against : 56,835 votes (56,835 votes)	0.03%
Votes invalid : 0 votes (0 votes)	0.00%
Votes abstained : 3,402,433 votes (3,367,547 votes)	2.29%

• *including votes casted electronically (numbers in brackets)

RESOLVED, that the proposal was approved as proposed.

• （ 3 ） Subject: To approve the amendment to Guidelines for Handling Acquisition and Disposal of Assets

Description:

• （ I ） To comply with the revision of Guidelines for Handling Acquisition and Disposal of Assets for TWSE/GTSM Listed Companies made by the authorities, the Company made amendment to Guidelines for Handling Acquisition and Disposal of Assets.

• （ II ） Please refer to attachment 8.

• （ III ） Please jointly decide

Voting Results: Shares represented at the time of voting: 148,448,388

*
Voting Results	% of the total represented share present
Votes in favor : 145,007,156 votes (44,427,126 votes)	97.68%
Votes against : 37,444 votes (37,444votes)	0.02%
Votes invalid : 0 votes (0 votes)	0.00%
Votes abstained : 3,403,788 votes (3,368,902votes)	2.29%

• *including votes casted electronically (numbers in brackets)

RESOLVED, that the proposal was approved as proposed.

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D. Special Motion:

Shareholder account number 30739 made suggestion towards operation of the Company. No resolution to be discussed and resolved.

E. Adjournment: 10:39 a.m.

Chairman: Jing-Rong Tang Recorder: Jui-Chiung Wang

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【 Attachment 1 】

Holy Stone Enterprise Co., Ltd.

Business Report

The world economy has been slowing clawing its way forward even with the influence of the black swan events taken place in 2016, Holy Stone (“the Company”, “we”) is no exception; The Company has been proactively transforming itself, and the sales for automotive and industrial use took up over 30% of total revenue. The Company reported consolidated revenue of NT$13,167 million, and earnings after tax of NT$2.26 per share.

Overall Performance

The Company’s house-brand product – Multilayer Ceramic Capacitor (MLCC) has gained in popularity in both of domestic and global market as we have devoted significantly to developing high-end product application, and reached a breakthrough for high capacitance MLCC. Holy Stone house brand product, MLCC, has also achieved ISO/TS16949 certification in late 2016, and this is another milestone set for Holy Stone after AEC-Q200 production. New products of system and module also found their way to gain market share in portable device market of IoT application. Revenue of sales from MLCC and system and module involved in industrial and automotive sectors contributed 32% of total revenue of 2016. Following the trend, these two markets will also be the direction and momentum of future growth for the year to come.

The Company has published Corporate Social Responsibility Report since 2008, with the aim of facilitating effective communication with employees, shareholders, and all of stakeholders and increasing corporate information transparency at the same time. In 2016, the Company made it to Taiwan Stock Exchange top 35% in Corporate Governance Evaluation.

Corporate Development

Over the years, the Company has been devoting substantial R&D expense in niche market. We have been sharpening automatic processing skills and staying on top of competition. Throughout the years of professional accumulation, the Company has acquired a number of patents, aiming to keep up sustainability, core competence and global competitively toward corporate preeminence.

While pursuing technical development as well as profitability, we will keep putting corporate governance into practice, adopting environmentally friendly measures, and working closely with suppliers to fulfill social responsibility; We will keep abiding by corresponding laws to provide a safe

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working environment and Health, hygiene and safety management in order to build a green enterprise.

Holy Stone appreciates dedication from employees, as well as support from customers, supplies, and shareholders. We will keep the cornerstone in mind and hope to exceed expectation at the end of the road.

Chairman: Jing-Rong Tang President: Jing-Rong Tang Accountant Manager: Shu-Ying Chang

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【 Attachment 2 】

Holy Stone Enterprise Co., Ltd. Supervisors’ Report

The Board of Directors has prepared the Company's 2016 Business Report, Financial Statements, and proposal for allocation of profits. Both CPA Ching-Song Wang and Pei-Chi Chen with KPMG were retained to audit Holy Stone's Financial Statements and have issued an audit report relating to the Financial Statements. The Business Report, Financial Statements, and profit allocation proposal have been reviewed and determined to be correct and accurate by the undersigned, the supervisors of Holy Stone Enterprise Company Limited. According to Article 219 of the Company Act, we hereby submit this report.

Holy Stone’s Annual Shareholders’ Meeting, 2017

Supervisor: Tang-Ming Wu

Chung-Yi Yang

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【 Attachment 3 】

Holy Stone Enterprise Co., Ltd. （“ the Company ”） Comparison Table for CSR Best Practices

No. Post-Amendment

Article The directors of a TWSE/GTSM listed 7 company shall exercise the due care of good administrators to urge the company to perform its corporate social responsibility initiatives, examine the results of the implementation thereof from time to time and continually make adjustments so as to ensure the thorough implementation of its corporate social responsibility policies.

The board of directors of a TWSE/GTSM listed company is advised to give full consideration to the interests of stakeholders, including the following matters, in the company's performance of its corporate social responsibility initiatives: 1. Identifying the company's corporate social responsibility mission or vision, and declaring its corporate social responsibility policy, systems or relevant management guidelines; 2. Making corporate social responsibility the guiding principle of the company's operations and development, and ratifying concrete promotional plans for corporate social responsibility initiatives; and 3. Enhancing the timeliness and accuracy of the

Pre-Amendment

The directors of a TWSE/GTSM listed company shall exercise the due care of good administrators to urge the company to perform its corporate social responsibility initiatives, examine the results of the implementation thereof from time to time and continually make adjustments so as to ensure the thorough implementation of its corporate social responsibility policies. The board of directors of a TWSE/GTSM listed company is advised to include the following matters in the company's performance of its corporate social responsibility initiatives: 1. Identifying the company's corporate social responsibility mission or vision, and declaring its corporate social responsibility policy, systems or relevant management guidelines; 2. Making corporate social responsibility the guiding principle of the company's operations and development, and ratifying concrete promotional plans for corporate social responsibility initiatives; and 3. Enhancing the timeliness and accuracy of the disclosure of corporate social responsibility information. The board of directors

Explanation According to the governing law and regulations

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No.	Post-Amendment	Pre-Amendment	Explanation
	disclosure of corporate social responsibility information. The board of directors shall appoint executive-level positions with responsibility for economic, environmental, and social issues resulting from the business operations of a TWSE/GTSM listed company, and to report the status of the handling to the board of directors. The handling procedures and the responsible person for each relevant issue shall be concrete and clear.	shall appoint executive-level positions with responsibility for economic, environmental, and social issues resulting from the business operations of a TWSE/GTSM listed company, and to report the status of the handling to the board of directors. The handling procedures and the responsible person for each relevant issue shall be concrete and clear.
Article 27	TWSE/GTSM listed companies shall evaluate the impact of their business operations on the community, and adequately employ personnel from the location of the business operations, to enhance community acceptance. TWSE/GTSM listed companies are advised to, through equity investment, commercial activities, endowments, volunteering service or other charitable professional services etc., dedicate resources to organizations that commercially resolve social or environmental issues, participate in events held by citizen organizations, charities and local government agencies relating to community development and community education to promote community development.	TWSE/GTSM listed companies shall evaluate the impact of their business operations on the community, and adequately employ personnel from the location of the business operations, to enhance community acceptance. TWSE/GTSM listed companies are advised to, through commercial activities, non-cash property endowments, volunteering service or other charitable professional services, participate in events held by citizen organizations, charities and local government agencies relating to community development and community education to promote community development.	According to the governing law and regulations
Article 32	CSR Best Practices was established on November 5,2014.	CSR Best Practices was established on November 5,2014.	Amending date

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No.	Post-Amendment	Pre-Amendment	Explanation
	The 1st amendments were made on March 18, 2015. The 2nd amendment was made on March 15,2017.	The 1st amendments were made on March 18, 2015.

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【 Attachment 4 】

Holy Stone Enterprise Co., Ltd. （“ the Company ”） Comparison Table for Corporate Governance Best Practice Principles

No.	Post-Amendment	Pre-Amendment	Explanation
Article 1	The Taiwan Stock Exchange Corporation (TWSE) and the Taipei Exchange (TPEx) hereby jointly adopt these Principles, to be followed by TWSE and TPEx listed companies, to assist them in establishing sound corporate governance systems and promote sound development of the securities market. TWSE/TPEx listed companies are advised to formulate their own corporate governance principles and establish an effective corporate governance framework with reference to these Principles and disclose them through the Market Observation Post System (MOPS).	The Taiwan Stock Exchange Corporation (TWSE) and the GreTai Securities Market (GTSM) hereby jointly adopt these Principles, to be followed by TWSE and GTSM listed companies, to assist them in establishing sound corporate governance systems and promote sound development of the securities market. TWSE/GTSM listed companies are advised to formulate their own corporate governance principles with reference to these Principles and disclose them through the Market Observatory Post System (MOPS).	According to the governing law and regulations
Article 2	When setting up the corporate governance system, in addition to complying with relevant laws, regulations, articles of incorporation, contracts signed with the TWSE or TPEx, and other relevant regulations, a TWSE/TPEx listed company shall follow the following principles: 1. Protect the rights and interests of shareholders. 2. Strengthen the powers of the board of directors. 3. Fulfill the function of supervisors. 4. Respect the rights and interests of stakeholders. 5.	When setting up the corporate governance system, in addition to complying with relevant laws, regulations, articles of incorporation, contracts signed with the TWSE or GTSM, and other relevant regulations, a TWSE/GTSM listed company shall follow the following principles: 1. Establish an effective corporate governance framework. 2. Protect the rights and interests of shareholders. 3.	According to the governing law and regulations

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No.	Post-Amendment	Pre-Amendment	Explanation
	Enhance information transparency.	Strengthen the powers of the board of directors. 4. Fulfill the function of supervisors. 5. Respect the rights and interests of stakeholders. 6. Enhance information transparency.
Article 3-1	(Personnel responsible for corporate governance affairs) A TWSE/TPEx listed company may set up a full- (or part-) time corporate governance unit or personnel to be in charge of corporate governance affairs and designate a senior officer to be in charge of supervision. Said officer shall be a qualified lawyer or accountant or have at least three years' management experience gained at a public company in handling legal affairs, financial affairs, stock affairs, etc. It is advisable that the corporate governance affairs mentioned in the preceding paragraph include at least the following items: 1. Handling corporate registration and amendment registration. 2. Handling matters relating to board meetings and shareholders meetings according to laws, and assisting the company with compliance with laws and regulations governing such meetings. 3. Producing minutes of board meetings and shareholders meetings. 4. Furnishing information required for business execution by directors and supervisors, and updating them on developments of laws and	New Article	According to the governing law and regulations
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No.	Post-Amendment	Pre-Amendment	Explanation
	regulations relating to the operation of the company in order to assist them with legal compliance. 5. Affairs relating to investor relations. 6. Other matters set out in the articles or corporation or contracts.
Article 4	The corporate governance system of a TWSE/TPEx listed company shall be designed to protect shareholders' rights and interests and treat all shareholders equitably. A TWSE/TPEx listed company shall establish a corporate governance system which ensures shareholders' rights of being fully informed of, participating in and making decisions over important matters of the company.	When implementing the corporate governance system, a TWSE/GTSM listed company shall take the protection of shareholders' rights and interests as its foremost goal and treat all shareholders fairly. A TWSE/GTSM listed company shall establish a corporate governance system which ensures shareholders' rights of being fully informed of, participating in and making decisions over important matters of the company.	According to the governing law and regulations
Article 6	The board of directors of a TWSE/TPEx listed company shall properly arrange the agenda items and procedures for shareholders meetings, and formulate the principles and procedures for shareholder nominations of directors and supervisors and submissions of shareholder proposals. The board shall also properly handle the proposals duly submitted by shareholders. Arrangements shall be made to hold shareholders meetings at a convenient location, with sufficient time allowed and sufficient numbers of suitable personnel assigned to handle attendance	The board of directors of a TWSE/GTSM listed company shall properly arrange the agenda items and procedures for shareholders meetings, and formulate the principles and procedures for shareholder nominations of directors and supervisors and submissions of shareholder proposals. The board shall also properly handle the proposals duly submitted by shareholders. Arrangements shall be made to hold shareholders meetings at a convenient location,	According to the governing law and regulations
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No.	Post-Amendment	Pre-Amendment	Explanation
	registrations. No arbitrary requirements shall be imposed on shareholders to provide additional evidentiary documents beyond those showing eligibility to attend. Shareholders shall be granted reasonable time to deliberate each proposal and an appropriate opportunity to make statements. For a shareholders meeting called by the board of directors, it is advisable that the board chairperson chair the meeting, that a majority of the directors (including at least one independent director) and at least one supervisor attend in person, and that at least one member of each functional committee attend as representative. Attendance details should be recorded in the shareholders meeting minutes.	with sufficient time allowed and sufficient numbers of suitable personnel assigned to handle attendance registrations. No arbitrary requirements shall be imposed on shareholders to provide additional evidentiary documents beyond those showing eligibility to attend. Shareholders shall be granted reasonable time to deliberate each proposal and an appropriate opportunity to make statements. For a shareholders meeting called by the board of directors, it is advisable that the board chairperson chair the meeting, that a majority of the directors and at least one supervisor attend in person, and that at least one member of each functional committee attend as representative. Attendance details should be recorded in the shareholders meetingminutes.
Article 7	A TWSE/TPEx listed company shall encourage its shareholders to actively participate in corporate governance. It is advisable that the company engage a professional shareholder services agent to handle shareholders meeting matters, so that shareholders meetings can proceed on a legal, effective and secure basis. A TWSE/TPEx listed company shall seek allways and means,	A TWSE/GTSM listed company shall encourage its shareholders to actively participate in corporate governance. It is advisable that the company engage a professional shareholder services agent to handle shareholders meeting matters, so that shareholders meetings can proceed on a legal,effective and	According to the governing law and regulations
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No.	Post-Amendment	Pre-Amendment	Explanation
	including fully exploiting technologies for information disclosure and casting votes, and is advised to upload notices, agendas and supplementary information of shareholders meetings in both Chinese and English concurrently in order to enhance shareholders' attendance rates at shareholders meetings and ensure their exercise of rights at such meetings in accordance with laws. A TWSE/TPEx listed company that employs electronic voting at a shareholders meeting is advised to avoid raising extraordinary motions and amendments to original proposals, and is advised to adopt a candidate nomination system for the election of directors and supervisors. TWSE/TPEx listed companies are advised to arrange for their shareholders to vote on each separate proposal in the shareholders meeting agenda, and following conclusion of the meeting, to enter the voting results the same day, namely the numbers of votes cast for and against and the number of abstentions, on the Market Observation Post System. If the company distributes souvenirs at its shareholders meeting, it shall not practice differential treatment or discrimination.	secure basis. A TWSE/GTSM listed company shall seek all ways and means, including fully exploiting technologies for information disclosure and casting votes, to enhance shareholders' attendance rates at shareholders meetings and ensure their exercise of rights at such meetings in accordance with law. A TWSE/GTSM listed company that employs electronic voting at a shareholders meeting is advised to avoid raising extraordinary motions and amendments to original proposals. TWSE/GTSM listed companies are advised to arrange for their shareholders to vote on each separate proposal in the shareholders meeting agenda, and following conclusion of the meeting, to enter the voting results the same day, namely the numbers of votes cast for and against and the number of abstentions, through the Internet information reporting system designated by the TWSE or the GTSM. If the company distributes souvenirs at its shareholders meeting, it shall not practice differential treatment or discrimination.

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No.	Post-Amendment	Pre-Amendment	Explanation
Article 12	In entering into material financial and business transactions such as acquisition or disposal of assets, lending funds, and making endorsements or providing guarantees, a TWSE/TPEx listed company shall proceed in accordance with the applicable laws and/or regulations and establish operating procedures in relation to these material financial and business transactions which shall be reported to and approved by the shareholders meeting so as to protect the interests of the shareholders. When a TWSE/TPEx listed company is involved in a merger, acquisition or public tender offer, in addition to proceeding in accordance with the applicable laws and/or regulations, it shall not only pay attention to the fairness, reasonableness, etc. of the plan and transaction of the merger, acquisition or public tender offer, , but information disclosure and the soundness of the company's financial structure thereafter. The relevant personnel of a TWSE/TPExlisted company handling the matters in the preceding paragraph shall pay attention to the occurrence of any conflicts of interest and the need for recusal.	In entering into material financial and business transactions such as acquisition or disposal of assets, lending funds, and making endorsements or providing guarantees, a TWSE/GTSM listed company shall proceed in accordance with the applicable laws and/or regulations and establish operating procedures in relation to these material financial and business transactions which shall be reported to and approved by the shareholders meeting so as to protect the interests of the shareholders. When a TWSE/GTSM listed company is involved in a management buyout, in addition to proceeding in accordance with the applicable laws and/or regulations, it is advisable to establish an objective and independent committee to review the reasonableness of the acquisition price and the acquisition plan, as well as pay attention to the regulations regarding the information disclosure. The relevant personnel of a TWSE/GTSM listed company handling the matters in the preceding paragraph shall pay attention to the occurrence of any	According to the governing law and regulations

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No.	Post-Amendment	Pre-Amendment	Explanation
		conflicts of interest and the need for recusal.
Chapter II Protection of Shareholders’ Rights and Interests Section 2 Corporate Governance Relationships Between the Company and Its Affiliated Enterprises		New Section
Article 13-1	(The board of directors is responsible for establishing a mechanism for interaction with shareholders) The board of directors of a TWSE/TPEx listed company is responsible for establishing a mechanism for interaction with shareholders to enhance mutual understanding of the development of company's objectives.	New Article	According to the governing law and regulations
Article 13-2	In addition to communicating with shareholders through shareholders meetings and encouraging shareholders to participate in such meetings, the board of directors of a TWSE/TPEx listed company together with officers and independent directors shall engage with shareholders in an efficient manner to ascertain shareholders' views and concerns, and expound company policies explicitly, in order to gain shareholders' support.	New Article	According to the governing law and regulations
Chapter II Protection of Shareholders’ Rights and Interests Section 3 Corporate Governance Relationships Between the Company and Its Affiliated Enterprises		Chapter II Protection of Shareholders’ Rights and Interests Section 2 Corporate Governance Relationships Between the Company and Its Affiliated Enterprises
Article	The board of directors of a TWSE/TPEx	The board of directors of a	According

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No.	Post-Amendment	Pre-Amendment	Explanation
20	listed company shall direct company strategies, supervise the management, and be responsible to the company and shareholders. The various procedures and arrangements of its corporate governance system shall ensure that, in exercising its authority, the board of directors complies with laws, regulations, its articles of incorporation, and the resolutions of its shareholders meetings. The structure of a TWSE/TPEx listed company's board of directors shall be determined by choosing an appropriate number of board members, not less than five, in consideration of its business scale, the shareholdings of its major shareholders, and practical operational needs. The composition of the board of directors shall be determined by taking diversity into consideration. It is advisable that directors concurrently serving as company officers not exceed one-third of the total number of the board members, and that an appropriate policy on diversity based on the company's business operations, operating dynamics, and development needs be formulated and include, without being limited to, the following two general standards: 1. Basic requirements and values: Gender, age, nationality, and culture. 2. Professional knowledge and skills: Aprofessional	TWSE/GTSM listed company shall be responsible to the shareholders meetings. The various procedures and arrangements of its corporate governance system shall ensure that, in exercising its authority, the board of directors complies with laws, regulations, its articles of incorporation, and the resolutions of its shareholders meetings. The structure of a TWSE/GTSM listed company's board of directors shall be determined by choosing an appropriate number of board members, not less than five, in consideration of its business scale, the shareholdings of its major shareholders, and practical operational needs. 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: 1. Basic requirements and values: Gender, age, nationality, and culture. 2. Professional knowledge and	to the governing law and regulations

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No.	Post-Amendment	Pre-Amendment	Explanation
	background (e.g., law, accounting, industry, finance, marketing, technology), professional skills, and industry experience. All members of the board shall have the knowledge, skills, and experience necessary to perform their duties. To achieve the ideal goal of corporate governance, the board of directors shall possess the following abilities: 1. Ability to make operational judgments. 2. Ability to perform accounting and financial analysis. 3. Ability to conduct management administration. 4. Ability to conduct crisis management. 5. Knowledge of the industry. 6. An international market perspective. 7. Ability to lead. 8. Ability to make policy decisions.	skills: A professional background (e.g., law, accounting, industry, finance, marketing, technology), professional skills, and industry experience. All members of the board shall have the knowledge, skills, and experience necessary to perform their duties. To achieve the ideal goal of corporate governance, the board of directors shall possess the following abilities: 1. Ability to make operational judgments. 2. Ability to perform accounting and financial analysis. 3. Ability to conduct management administration. 4. Ability to conduct crisis management. 5. Knowledge of the industry. 6. An international market perspective. 7. Ability to lead. 8. Ability to makepolicydecisions.
Article 21	A TWSE/TPEx listed company shall, according to the principles for the protection of shareholder rights and interests and equitable treatment of shareholders, establish a fair, just, and open procedure for the election of directors, encourage shareholder participation, and adopt the cumulative voting mechanism pursuant to the Company Act in order to fully reflect shareholders' views. Unless the competent authority otherwisegrants an approval,a spousal	A TWSE/GTSM listed company shall establish a fair, just, and open procedure for the election of directors, and shall adopt the cumulative voting mechanism pursuant to the Company Act in order to fully reflect shareholders' views. Unless the competent authority otherwise grants an approval, a spousal relationship or a familial relationship within the second degree of kinshipmaynot exist	According to the governing law and regulations
	~21~

No.	Post-Amendment	Pre-Amendment	Explanation
	relationship or a familial relationship within the second degree of kinship may not exist among more than half of the directors of a TWSE/TPEx listed company. When the number of directors falls below five due to the discharge of a director for any reason, the company shall hold a by-election for director at the following shareholders meeting. When the number of directors falls short by one-third of the total number prescribed by the articles of incorporation, the company shall convene a special shareholders meeting within 60 days of the occurrence of that fact for a by-election for director(s). The aggregate shareholding percentage of all of the directors of a TWSE/TPEx listed company shall comply with the laws and regulations. Restrictions on the share transfer of each director and the creation, release, or changes of any pledges over the shares held by each director shall be subject to the relevant laws and regulations, and the relevant information shall be fully disclosed.	among more than half of the directors of a TWSE/GTSM listed company. When the number of directors falls below five due to the discharge of a director for any reason, the company shall hold a by-election for director at the following shareholders meeting. When the number of directors falls short by one-third of the total number prescribed by the articles of incorporation, the company shall convene a special shareholders meeting within 60 days of the occurrence of that fact for a by-election for director(s). The aggregate shareholding percentage of all of the directors of a TWSE/GTSM listed company shall comply with the laws and regulations. Restrictions on the share transfer of each director and the creation, release, or changes of any pledges over the shares held by each director shall be subject to the relevant laws and regulations, and the relevant information shall be fully disclosed.
Article 22	A TWSE/TPEx listed company is advised to specify in its articles of incorporation that it adopts the candidate nomination system for elections of directorspursuant to the	A TWSE/GTSM listed company is advised to specify in its articles of incorporation that it adopts the candidate nomination system for elections of directorspursuant to	According to the governing law and regulations
	~22~

No.	Post-Amendment	Pre-Amendment	Explanation
	Company Act. It is advisable that the company review in advance 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 the director candidates recommended by shareholders or directors, and the company may not arbitrarily add requirements for documentation of other qualifications. It is advised to provide the results of the review to shareholders for their reference, so that qualified directors will be elected. The board of directors shall assess carefully the qualifications and other matters listed in the preceding paragraph and the willingness of a candidate to act as director after it is so elected, before proposing a roster of director candidates as required.	the Company Act. It is advisable that the company review in advance 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 the director candidates recommended by shareholders or directors, and the company may not arbitrarily add requirements for documentation of other qualifications. It is advised to provide the results of the review to shareholders for their reference, so that qualified directors will be elected.
Article 23	Clear distinctions shall be drawn between the responsibilities and duties of the chairperson of the board of a TWSE/TPEx listed company and those of its general manager. It is inappropriate for the chairperson to also act as the general manager. If the chairperson also acts as the general manager or the chairperson and general manager are spouses or relatives within one degree of consanguinity, it is advisable that the number of independent directors be increased.	Clear distinctions shall be drawn between the responsibilities and duties of the chairperson of the board of a TWSE/GTSM listed company and those of its general manager. It is inappropriate for the chairperson to also act as the general manager. If the chairperson also acts as the general manager or the chairperson and general manager are spouses or relativeswithin one	According to the governing law and regulations
	~23~

No.	Post-Amendment	Pre-Amendment	Explanation
	A TWSE/TPEx listed company with a functional committee shall clearly define the responsibilities and duties of the committee.	degree of consanguinity, it is advisable that the number of independent directors be increased. If it is necessary to set up a functional committee, the responsibilities and duties of the committee shall be clearly defined.
Article 24	A TWSE/TPEx listed company shall appoint independent directors in accordance with its articles of incorporation. They shall be not less than two in number and not less than one-fifth of the total number of directors. Independent directors shall possess professional knowledge and there shall be restrictions on their shareholdings. Applicable laws and regulations shall be observed and, in addition, it is not advisable for an independent director to hold office concurrently as a director (including independent director) or supervisor of more than five other TWSE/TPEx listed companies. Independent directors shall also maintain independence within the scope of their directorial duties, and may not have any direct or indirect interest in the company. (Omitted)	A TWSE/GTSM listed company shall appoint independent directors in accordance with its articles of incorporation. They shall be not less than two in number and not less than one-fifth of the total number of directors. Independent directors shall possess professional knowledge and there shall be restrictions on their shareholdings and the positions they may concurrently hold. They shall maintain independence within the scope of their directorial duties, and may not have any direct or indirect interest in the company. (Omitted)	According to the governing law and regulations
Article 26	A TWSE/TPEx listed company shall stipulate the scope of duties of the independent directors and empower them with manpower andphysical	A TWSE/GTSM listed company shall stipulate the scope of duties of the independent directors and empower them with manpower	According to the governing law and
	~24~

No.	Post-Amendment	Pre-Amendment	Explanation
	support related to the exercise of their power. The company or other board members shall not restrict or obstruct the performance of duties by the independent directors. A TWSE/TPEx listed company shall stipulate the remuneration of the directors according to applicable laws and regulations. The remuneration of the directors shall fully reflect the personal performance and the long-term management performance of the company, and shall also take the overall operational risks of the company into consideration. Different but reasonable remuneration from that of other directors may be set forth for the independent directors. When a TWSE/TPEx listed company, under its articles of incorporation, or by resolution of its shareholders meeting, or by order of the competent authority, sets aside a certain proportion of earnings as special reserve, such allocation shall be made after the allocation of legal reserve and before the distribution of director, supervisor, and employee compensations, and the company shall provide in the articles of incorporation the method to be adopted for distributing earnings when reversal of the special reserve is added into the undistributed earnings.	and physical support related to the exercise of their power. The company or other board members shall not restrict or obstruct the performance of duties by the independent directors. A TWSE/GTSM listed company shall stipulate the remuneration of the directors in its articles of incorporation or approve the same in a shareholders meeting. The remuneration of the directors shall fully reflect the personal performance and the long-term management performance of the company, and shall also take the overall operational risks of the company into consideration. Different but reasonable remuneration from that of other directors may be set forth for the independent directors. When a TWSE/GTSM listed company, under its articles of incorporation, or by resolution of its shareholders meeting, or by order of the competent authority, sets aside a certain proportion of earnings as special reserve, such allocation shall be made after the allocation of legal reserve and before the distribution of director and supervisor compensation and employee bonuses, and the companyshallprovide in the	regulations

~ 25 ~

No.	Post-Amendment	Pre-Amendment	Explanation
		articles of incorporation the method to be adopted for distributing earnings when reversal of the special reserve is added into the undistributed earnings.
Section 3 Functional Committees		Section 3 Audit Committee and Other FunctionalCommittees
Article 27	For the purpose of developing supervisory functions and strengthening management mechanisms, the board of directors of a TWSE/TPEx listed company, in consideration of the company's scale and type of operations and the number of its board members, may set up functional committees for auditing, remuneration, nomination, risk management or any other functions, and based on concepts of corporate social responsibility and sustainable operation, may set up environmental protection, corporate social responsibility, or other committees, and expressly provide for them in the articles of incorporation. (Omitted)	For the purpose of developing supervisory functions and strengthening management mechanisms, the board of directors of a TWSE/GTSM listed company, in consideration of the size of its board and the number of its independent directors, may set up functional committees for auditing, nomination, risk management or any other functions, and based on concepts of corporate social responsibility and sustainable operation, may set up environmental protection, corporate social responsibility, or other committees, and expressly provide for them in the articles of incorporation. (Omitted)	According to the governing law and regulations
Article 29	(Omitted) When performing the official powers of the preceding paragraph, the remuneration committee shall follow the principles listed below: 1. With respect to the performance assessments and remuneration of directors,	(Omitted) When performing the official powers of the preceding paragraph, the remuneration committee shall follow the principles listed below: 1. With respect to theperformance	According to the governing law and regulations
	~26~

No.	Post-Amendment	Pre-Amendment	Explanation
	supervisors and managerial personnel of the company, it shall refer to the typical pay levels adopted by peer companies, and take into consideration the reasonableness of the correlation between remuneration and individual performance, the company's business performance, and future risk exposure. 2. It shall not produce an incentive for the directors or managerial officers to engage in activity to pursue remuneration exceeding the risks that the company may tolerate. 3. It shall take into consideration the characteristics of the industry and the nature of the company's business when determining the ratio of compensation for the short-term performance of its directors and senior management and the time at which the variable part of remuneration is paid.	assessments and remuneration of directors, supervisors and managerial personnel of the company, it shall refer to the typical pay levels adopted by peer companies, and take into consideration the reasonableness of the correlation between remuneration and individual performance, the company's business performance, and future risk exposure. 2. It shall not produce an incentive for the directors or managerial officers to engage in activity to pursue remuneration exceeding the risks that the company may tolerate. 3. It shall take into consideration the characteristics of the industry and the nature of the company's business when determining the ratio of bonuses for the short-term performance of its directors and senior management and the time at which the variable part of remuneration ispaid.
Article 30	A TWSE/TPEx listed company is advised to establish and announce channels for internal and external whistleblowers and have whistleblower protection mechanisms in place. The unit that handles whistleblowers' reporting shall be independent, provide encrypted protection for the files furnished by whistleblowers,and	A TWSE/GTSM listed company is advised to establish channels for anonymous whistleblowing and whistleblower protection mechanisms. The unit that handles complaints shall be independent, provide encrypted protection for the files furnished by whistleblowers,and appropriately	According to the governing law and regulations

~ 27 ~

No.	Post-Amendment	Pre-Amendment	Explanation
	appropriately restrict access to such files. It shall also formulate internal procedures and incorporate those procedures into the company's internal control system for management purposes.	restrict access to such files. It shall also formulate internal procedures and incorporate those procedures into the company's internal control system for managementpurposes.
Article 39	Members of the board of directors shall faithfully conduct corporate affairs and perform the duty of care of a good administrator. In conducting the affairs of the company, they shall exercise their powers with a high level of self-discipline and prudence. Unless matters are otherwise reserved by law for approval in shareholders meetings or in the articles of incorporation, they shall ensure that all matters are handled according to the resolutions of board of directors. Any resolution of the board of directors that involves the company's business development or a major policy direction shall be carefully considered and may not affect the implementation or effectiveness of corporate governance. It is advisable that a TWSE/TPEx listed company formulate rules and procedures for board of directors performance assessments, and that each year it conduct regularly scheduled performance assessments of the board of directors, functional committees, and individual directors through self-assessment, peer-to-peer assessments,engagingoutside	Members of the board of directors shall faithfully conduct corporate affairs and perform the duty of care of a good administrator. In conducting the affairs of the company, they shall exercise their powers with a high level of self-discipline and prudence. Unless matters are otherwise reserved by law for approval in shareholders meetings or in the articles of incorporation, they shall ensure that all matters are handled according to the resolutions of board of directors. Any resolution of the board of directors that involves the company's business development or a major policy direction shall be carefully considered and may not affect the implementation or effectiveness of corporate governance. Independent directors shall perform their duties in accordance with relevant laws, regulations and the company's articles of incorporation so as to protect the interests of the companyand	According to the governing law and regulations
	~28~

No.	Post-Amendment	Pre-Amendment	Explanation
	professional institutions, or in any other appropriate manner. It is advisable that the performance assessment of the board of directors (functional committees) include the following aspects, and that appropriate assessment indicators be developed in consideration of the company's needs: 1. The degree of participation in the company's operations. 2. Improvement in the quality of decision making by the board of directors. 3. The composition and structure of the board of directors. 4. The election of the directors and their continuing professional education. 5. Internal controls. It is advisable that performance assessments of board members (self-assessments or peer-to-peer assessments) include the following aspects, with appropriate adjustments made on the basis of the company's needs: 1. Their grasp of the company's goals and missions. 2. Their recognition of director's duties. 3. Their degree of participation in the company's operations. 4. Their management of internal relationships and communication. 5. Their professionalism and continuing professional education. 6. Internal controls. A TWSE/TPEx listed company's board of directors shall consider adjusting its composition based on the results of	shareholders. It is advisable that a TWSE/GTSM listed company formulate rules and procedures for board of directors performance assessments, and that each year it conduct regularly scheduled performance assessments of the board of directors, functional committees, and individual directors through self-assessment, peer-to-peer assessments, engaging outside professional institutions, or in any other appropriate manner. It is advisable that the performance assessment of the board of directors (functional committees) include the following aspects, and that appropriate assessment indicators be developed in consideration of the company's needs: 1. The degree of participation in the company's operations. 2. Improvement in the quality of decision making by the board of directors. 3. The composition and structure of the board of directors. 4. The election of the directors and their continuing professional education. 5. Internal controls. It is advisable that performance assessments of board members (self-assessments or peer-to-peer assessments)include the

~ 29 ~

No.	Post-Amendment	Pre-Amendment	Explanation
	performance assessments. A TWSE/GTSM listed company's board of directors shall consider adjusting its composition based on the results of performance assessments.	following aspects, with appropriate adjustments made on the basis of the company's needs: 1. Their grasp of the company's goals and missions. 2. Their recognition of director's duties. 3. Their degree of participation in the company's operations. 4. Their management of internal relationships and communication. 5. Their professionalism and continuing professional education. 6. Internal controls. A TWSE/GTSM listed company's board of directors shall consider adjusting its composition based on the results of performance assessments.
Article 42	A TWSE/TPEx listed company is advised to take out directors liability insurance with respect to liabilities resulting from exercising their duties during their terms of occupancy so as to reduce and spread the risk of material harm to the company and shareholders arising from the wrongdoings or negligence of a director. A TWSE/TPEx listed company is advised to report the insured amount, coverage, premium rate, and other major contents of the liability insurance it has taken out or renewed for directors, at the next board meeting.	According to the articles of incorporation or a resolution adopted in the shareholders meeting, a TWSE/GTSM listed company may take out liability insurance for directors with respect to liabilities resulting from exercising their duties during their terms of occupancy so as to reduce and spread the risk of material harm to the company and shareholders arising from the wrongdoings or negligence of a director.	According to the governing law and regulations
Article	A TWSE/TPEx listed companyis	A TWSE/GTSM listed company	According
	~30~

No.	Post-Amendment	Pre-Amendment	Explanation
45	advised to specify in its articles of incorporation that it adopts the candidate nomination system for elections of supervisors pursuant to the Company Act, and to review in advance 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 the supervisor candidates recommended by the shareholders or directors, and the company may not arbitrarily add requirements for documentation of other qualifications. It is advised to provide the results of the review to the shareholders for their reference, so that qualified supervisors will be elected. The board of directors shall assess carefully the qualifications and other matters listed in the preceding paragraph and the willingness of a candidate to act as supervisor after it is so elected, before proposing a roster of supervisor candidates as required.	is advised to specify in its articles of incorporation that it adopts the candidate nomination system for elections of supervisors pursuant to the Company Act, and to review in advance 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 the supervisor candidates recommended by the shareholders or directors, and the company may not arbitrarily add requirements for documentation of other qualifications. It is advised to provide the results of the review to the shareholders for their reference, so that qualified supervisors will be elected.	to the governing law and regulations
Article 52	A TWSE/TPEx listed company is advised to take out supervisors liability insurance with respect to liabilities resulting from the exercise of duties during their terms, so as to reduce and spread the risk of material harm to the company and shareholders arising from the wrongdoing or negligence of a supervisor. A TWSE/TPEx listed companyis	In accordance with the articles of incorporation or a resolution adopted at a shareholders meeting, a TWSE/GTSM listed company may take out liability insurance for supervisors with respect to liabilities resulting from the exercise of duties during their terms, so as to reduce and spread the risk of material harm to the	According to the governing law and regulations
	~31~

No.	Post-Amendment	Pre-Amendment	Explanation
	advised to report the insured amount, coverage, premium rate, and other major contents of the liability insurance it has taken out or renewed for supervisors,at the next board meeting.	company and shareholders arising from the wrongdoing or negligence of a supervisor.
Article 54	(A TWSE/TPEx listed company shall maintain communication with stakeholders and safeguard their rights and interests) A TWSE/TPEx listed company shall maintain channels of communication with its banks, other creditors, employees, consumers, suppliers, community, or other stakeholders of the company, respect and safeguard their legal rights and interests, and designate a stakeholders section on its website. When any of a stakeholder's legal rights or interests is harmed, the company shall handle the matter in a proper manner and in good faith.	A TWSE/GTSM listed company shall maintain channels of communication with its banks, other creditors, employees, consumers, suppliers, community, or other stakeholders, and shall respect and safeguard their legal rights. It is advisable for the company to designate a stakeholders section on its website. When a TWSE/GTSM listed company is involved in a management buyout, it shall monitor the subsequent soundness of the company's financial structure. When any of a stakeholder's legal rights or interests is harmed, the company shall handle the matter in a proper manner and in good faith.	According to the governing law and regulations
Article 61	A TWSE/TPEx listed company shall hold an investor conference in compliance with the regulations of the TWSE and TPEx, and shall keep an audio or video record of the meeting. The financial and business information disclosed in the investor conference shall be disclosed on the Market	A TWSE/GTSM listed company shall hold an investor conference in compliance with the regulations of the TWSE and GTSM, and shall keep an audio or video record of the meeting. The financial and business information disclosed in the investor	According to the governing law and regulations

~ 32 ~

No.	Post-Amendment	Pre-Amendment	Explanation
	Observation Post System and provided for inquiry through the website established by the company, or through other channels, in accordance with the TWSE or TPEx rules.	conference shall be disclosed on the designated Internet information posting system and provided for inquiry through the website established by the company, or through other channels, in accordance with the TWSE or GTSM rules.
Article 62	A TWSE/TPEx listed company shall disclose and update from time to time the following information regarding corporate governance in the fiscal year in accordance with laws and regulations and TWSE or TPEx rules (disclosure of supervisors' information is not required if the company has an audit committee): 1. Corporate governance framework and rules. 2. Ownership structure and the rights and interests of shareholders, including specific and explicit dividend policy). 3. Structure, professionalism and independence of the board of directors. 4. Responsibility of the board of directors and managerial officers. 5. Composition, duties and independence of the audit committee or supervisors. 6. Composition, duties and operation of the remuneration committee and other functional committees. 7. The remuneration paid to the directors, supervisors, general manager and vice general manager in the last two fiscal years, the analysis of the percentage of total remuneration to net profit after tax in theparent companyonlyfinancial	A TWSE/GTSM listed company shall disclose the following information regarding corporate governance in the fiscal year in accordance with laws and regulations and TWSE and GTSM rules: 1. Corporate governance framework and rules. 2. Ownership structure and the rights and interests of shareholders. 3. Structure and independence of the board of directors. 4. Responsibility of the board of directors and managerial officers. 5. Composition, duties and independence of the audit committee or supervisors. 6. Composition, duties and operation of the remuneration committee. 7. The remuneration paid to the directors, supervisors, general manager and vice general manager in the most recent fiscal year, the analysis of the percentage of total remuneration to net profit after tax, the policy, standard andpackage of	According to the governing law and regulations
	~33~

No.	Post-Amendment	Pre-Amendment	Explanation
	reports or individual financial reports, the policy, standard and package of remuneration payment, the procedure for determination of remuneration and the connection with the operation performance and future risk. Under special individual circumstances, remuneration of individual directors and supervisors shall be disclosed. 8. The progress of training of directors and supervisors. 9. The rights, relationships, avenues for complaint, concerns, and appropriate response mechanism regarding stakeholders. 10. Details of the events subject to information disclosure required by law and regulations. 11. The enforcement of corporate governance, differences between the corporate governance principles implemented by the company and these Principles, and the reason for the differences. 12. Other information regarding corporate governance. (Omitted)	remuneration payment, the procedure for determination of remuneration and the connection with the operation performance. Under special individual circumstances, remuneration of individual directors and supervisors shall be disclosed. 8. The progress of training of directors and supervisors. 9. The rights of and relationships between the stakeholders. 10. Details of the events subject to information disclosure required by law and regulations. 11. The enforcement of corporate governance, differences between the corporate governance principles implemented by the company and these Principles, and the reason for the differences. 12. Other information regarding corporate governance. (Omitted)
Article 65	Corporate Governance Best Practice Principles was established on November 5, 2014. The 1st amendments were made on March 18, 2015. The 2nd amendment was made on March 15,2017.	CSR Best Practices was established on November 5, 2014. The 1st amendments were made on March 18, 2015.	According to the governing law and regulations

~ 34 ~

Holy Stone Enterprise Co., Ltd. （“ the Company ”） Comparison Table for Amendment to the Company’s Articles of Association

	No.	Post-Amendment	Pre-Amendment	Explanation
	Article 5.1	When the Company below the market price of the warrants issuance of employee stock options, should be represented more than half of total number of issued shares of the shareholders attending the shareholders' meeting, attended by more than two-thirds of the voting rights of the shareholders consent, may only issue. When the Company bought back shares for less than the actual average price of the transfer of treasury stock to employees, shall, prior to the transfer, drew the last representatives of the shareholders attending the issued shares of a majority of the total number of shareholders attending the shareholders voting rights of more than two-thirds agree.	New clause	According to the governing law and regulations
	Article 19	When allocating the profit for each fiscal year, before the annual tax reduction, the Company shall offset its losses in previous years（including adjusted earnings amount unallocated）,if any balance, the Company shall set aside not less than 7% as profit sharing bonuses to its employees, and not more than 3% as remuneration to its directors and supervisors. The decision of paying ratio and paying by shares or cash to employee bonuses,	The original article was deleted	According to the governing law and regulations

~ 35 ~

No.	Post-Amendment	Pre-Amendment	Explanation
	remuneration to directors and supervisors shall be made by the board of directors with more than a two-thirds majority of the directors present and agreed with more than half, and will report to the shareholders’ meeting. The remuneration to directors and supervisors should be in cash only. The employee compensation issue shares or cash is including compliance with certain conditions of subsidiaryemployees.
Article 20	The company’s annual profit after taxes, if any, are subject to distribute as follows: 1.Completing the accumulated deficit and losses（including adjustment of non-distribute earnings） 2. To set 10% legal reserve, unless the legal reserve has reached the total capital. 3. The remaining balance thereafter should be applied to have the special reserve appropriated or reversed lawfully. 4. The remaining balance thereafter should plus the accumulated unappropriated earnings, to be proposed by the Board of directors for the distribution of shareholder’s dividend in the shareholders meeting.	The company’s annual earnings, if any, are subject to distribute as follows: 1. Payment of taxes and dues. 2.. Completing the deficit and losses of previous years. 3. To set 10% legal reserve, unless the legal reserve has reached the total capital. 4. The remaining balance thereafter should be applied to have the special reserve appropriated or reversed lawfully. 5.The remaining balance thereafter should be allocated proportionally to directors, supervisors and employees. （I） Remuneration to directors and	According to the governing law and regulations

~ 36 ~

No.	Post-Amendment	Pre-Amendment	Explanation
	（Omitted , the rest of paragraph has no change.）	supervisors for less than 3%. （II）Bonus to employees for over 7%. The bonus to employees referred to above may include the employees of the subsidiaries that meet certain conditions, which are to be determined by the Board of Directors, or authorized representative. 6. The remaining balance thereafter should be proposed by the Board of directors for the distribution of shareholder’s dividend in the shareholders meeting. （Omitted , the rest of paragraph has no change.）
Article 22	The Company Article was established on May 6, 1981. The first ~ 25thamendments are omitted. The 26thamendment was made on June 7, 2016.	The Company Article was established on May 6, 1981. The first ~ 24thamendments are omitted. The 25thamendment was made onJune9,2015.	Amending date

~ 37 ~

【 Attachment 5 】

English Translations of Financial Statements Originally Issued in Chinese

Independent Auditors' Report

The Board of Directors and Shareholders

Holy Stone Enterprise Company Limited

Opinion

We have audited the financial statements of Holy Stone Enterprise Company Limited , which comprise the financial statements for the parent company. The financial statements for the parent company and its subsidiaries comprise the statement of financial position as at 31 December 2016, and 2015, the statement of income, the statement of comprehensive income, the statements of cash flows and changes in equity for the year then ended and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the financial statements of the parent company have been prepared in accordance with laws and regulations and present fairly, in all material respects, the financial position of the parent company as at 31 December 2016 and 2015 and their financial performance for the year then ended in accordance with Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

Basis for Opinion

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

Other Information

Part of Holy Stone Enterprise Company Limited’s investment that accounted under equity method was audited

~ 38 ~

by other accountants. Therefore, the amount of partial parent company financial statement among our opinion on these financial statements was according to other accountants’ auditor’s report. As of December 31, 2016 and 2015, the investment amounts accounted under equity method made up 2.61% and 2.44% of total assets, respectively; the gains or losses from subsidiaries using equity method for the year ended December 31, 2016 and 2015 made up 0.27% and 0.11% of Net income before tax, respectively.

Key Audit Matters

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

Revenue Recognition

Refer to the note 4.11 and 6.16 for more details on Unconsolidated Financial Statements.

The parent company’s revenue is primarily generated from the provision of multilayer ceramic capacitors, integrated circuits, modules, and other electronic components. We identified revenue recognition as a key audit matter because revenue is one of the key performance indicators of the parent company. We evaluated the design and execution of internal control system, revenue analysis of top 10 trading partners, key reconciliations to assess the completeness and accuracy of revenue, including testing the period in which it is reported.

Valuation of Accounts Receivable

Refer to the note 4.6.4, 5.1, and 6.5 for more details on Unconsolidated Financial Statements.

The parent company’s accounts receivable evaluation is based on collectability. Due to high volatility of the industry, it is uncertain to have enough of information of collectability before the Unconsolidated Financial Statements is reported. In addition, the evaluation of collectability involves professional judgment from the management. Therefore, we identified accounts receivable as a key audit matter.

Valuation of Inventories

Refer to the note 4.7, 5.2, and 6.6 for more details on Unconsolidated Financial Statements. Inventory is carried in the Financial Statements at the lower of cost and net realisable value. Sales in the electronic components industry can be extremely volatile with consumer demand changing significantly based on current trends. As a result there is a risk that the carrying value of inventory exceeds its net realisable value. Our audit procedures were designed to challenge the reasonableness of the parent company’s provisions against impairment of inventory, assessing the hypothesis of allowance for inventory valuation and obsolescence losses from previous years; check if the parent company adopts the valuation of inventories; check inventory age report

~ 39 ~

and analyze the pattern; look into the pattern of selling price and market value of inventories to evaluate the reasonableness of net realisable value; evaluate the legitimacy of the disclosure of allowance for inventory valuation.

Valuation of of investment using equity method

Refer to the note 4.8, 5.3, and 6.7 for more details on Unconsolidated Financial Statements. We identified Valuation of of investment using equity method as a key audit matter, as the ending balance of investment using equity method as of December 31st, 2016 made up 19% of consolidated total assets. Our audit procedures were designed to understand the internal control system of investment using equity method; check for discrepancy of the investment amount; check if the ownership ratio is correct; check for discrepancy of the cost and net value of stocks, and check if adequate procedures are taken to deal with any change of unrealized gain/loss and stockholders’ equity of the investee company; evaluate if there is any impairment occurred and the reasonableness of future discounted cash flow from investee company.

Responsibilities of management for the financial statements

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

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

Those charged with governance (including members of the Audit Committee) are responsible for overseeing the parent company’s financial reporting process.

Auditor’s responsibilities for the audit of the financial statements

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

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

~ 40 ~

1. identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;

2. obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control;

3. evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management;

4. conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the parent company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern;

5. evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

6. obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the parent company to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion

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

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public

~ 41 ~

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

KPMG

Accountants:

Taipei, Taiwan Republic of China March 15, 2017

~ 42 ~

English Translations of Financial Statements Originally Issued in Chinese HOLY STONE ENTERPRISE COMPANY LIMITED

Balance Sheets

December 31, 2016, 2015 (Expressed in Thousands of New Taiwan Dollars)

Assets Current Assets: 1100 Cash and Cash Equivalents (Note6.1) 1110 Financial Assets at Fair Value through Profit or Loss - Current (Note6.2) 1150 Notes and Accounts Receivable, net (Note6.5) 1180Account Receivable - Related Parties (Note6.4&7) 1200Other Receivables (Note6.5) 130X Inventories (Note6.6) 1410 Prepaid Expenses and Other Current Assets Total Current Assets Noncurrent Assets: 1523 Available-for-sale Financial Assets - Noncurrent (Note6.3) 1543 Financial Assets Carried at Cost - Noncurrent (Note6.4) 1550 Investments under Equity Method (Note6.7) 1600 Property, Plant and Equipment (Note6.8 & 7) 1840 Deferred Income Tax Assets (Note6.12) 1915 Prepaid Expense on Equipment 1990 Other Noncurrent Assets - Others (Note8) Total Noncurrent Assets Total Assets		2016.12.31		% 21 - 20 8 1 14 -		2015.12.31	% 15 4 20 7 - 13 - 59 - - 21 20 - - - 41 100 Liabilities and Equity Current Liabilities: 2100Short-term Loans (Note6.9) 2170Notes and Accounts Payable 2180Accounts Payable - Related Parties (Note7) 2200Other Receivables 2230Current Period Income Tax Liability Total Current Liabilities Noncurrent Liabilities: 2570Deferred Income Tax Liabilities (Note6.12) 2640Accrued Pension Liabilities (Note6.11) 2670Other Noncurrent Liabilities – Others Total Noncurrent Liabilities Total Liabilities Equity (Note6.10 & 6.11 & 6.13): 3110Common Stock 3200Capital Surplus Retained Earnings: 3310 Legal Reserve 3350 Unappropriated Earnings Total Retained Earnings Other Equity: 3410 Exchange Differences on Translation of Financial Statements of Foreign Operations 3425 Unrealized Gains and Losses on Available-for-sale Financial Assets Total Other Equity Total Equity Total Liabilities and Equity*		2016.12.31	% 14 9 - 4 -	2015.12.31 Amount % 1,260,187 11 917,803 8 50,821 - 432,600 4 70,628 1 2,732,039 24 45,711 - 56,774 1 16 - 102,501 1 2,834,540 25 2,242,154 20 3,608,244 32 1,161,732 11 1,150,743 11 2,312,475 22 45,807 - 156,047 1 201,854 1 8,364,727 75 11,199,267 100	2015.12.31 Amount % 1,260,187 11 917,803 8 50,821 - 432,600 4 70,628 1 2,732,039 24 45,711 - 56,774 1 16 - 102,501 1 2,834,540 25 2,242,154 20 3,608,244 32 1,161,732 11 1,150,743 11 2,312,475 22 45,807 - 156,047 1 201,854 1 8,364,727 75 11,199,267 100
		Amount $ 2,350,568 15,157 2,267,708 887,324 116,329 1,544,119 20,188				Amount 1,649,931 478,636 2,178,533 772,961 44,936 1,472,818 10,503			Amount $ 1,633,059 951,469 56,863 410,746 38,544		Amount 1,260,187 917,803 50,821 432,600 70,628
									3,090,681	27	2,732,039	24
									28,429 59,738 19	- 1 -	45,711 56,774 16	- 1 -
		7,201,393		64		6,608,318
		49,570 24,246 2,138,335 1,950,016 31,563 10,051 13,270		- - 19 17 - - -		30,272 24,246 2,343,030 2,131,464 28,660 18,057 15,220
									88,186	1	102,501	1
									3,178,867	28	2,834,540	25
									2,242,154	20	2,242,154	20
									3,567,070	31	3,608,244	32
									1,221,549 1,032,179	11 9	1,161,732 1,150,743	11 11
		4,217,051		36		4,590,949
									2,253,728	20	2,312,475	22
									13,280 163,345	- 1	45,807 156,047	- 1
									176,625	1	201,854	1
									8,239,577	72	8,364,727	75
		$ 11418444		100		11199267			$ 11,418,444	100	11,199,267	100

The accompanying notes are an integral part of the financial statements. Chairman: Jing-Rong Tang

Accountant Manager: Shu-Ying Chang

President: Jing-Rong Tang

~ 43 ~

English Translations of Financial Statements Originally Issued in Chinese

HOLY STONE ENTERPRISE COMPANY LIMITED

Statements of Income

For the years ended December 31, 2016, 2015

(Expressed in Thousands of New Taiwan dollars, except earnings per share)

4000 Net Sales(Note6.16&7) 5000 Cost of Goods Sold(Note6.11&7&12) Gross Profit 5910 Unrealized Gains and Losses on Sales Gross Profit Operating Expense(Note6.11&7&12) 6100 Selling and Administrative 6300 Research and Development Total Operating Expense Operating Income Non-Operating Income and Expenses(Note6.10&7): 7020 Other Gains and Losses 7050 Financial Costs 7070 Gains of Losses from Subsidiary Using Equity Method 7100 Interest Income Total Non-Operating Income and Expenses 7900 Income before Income Tax 7950 Less: Income Tax Expense(Note6.12) Net Income for Current Period 8300 Other Comprehensive Gains and Losses: 8310 Revaluation income 8311 Defined benefit plan 8349 Income Tax incurred Total Revaluation income 8360 Revaluation income arising from reclassification 8361 Exchange Differences on Translation of Financial Statements of Foreign Operations 8362 Unrealized Valuation Gains (Loss) on Available-for-sale Financial Assets 8399 Income Tax related to reclassification Total Revaluation income arising from reclassification 8300 Other Comprehensive Income for Current Period (after tax) Total Comprehensive Income for Current Period Earnings per Share(Note 6.15) 9750 Basic Earnings per Share (Unit: NT Dollar) 9850 Diluted Earnings per Share (Unit: NT Dollar)***	2016	2015 ％ Amount 100 $ 12,154,324 (87) (10,553,722)	2015	％ 100 (87)
	Amount $ 11,546,400 (10,072,169)
	1,474,231 (5,751)	13 1,600,602 - 7,351		13 -
	1,468,480	13 1,607,953		13
	(630,385) (144,025)	(5) (601,899) (1) (119,551)		(5) (1)
	(774,410)	(6) (721,450)		(6)
	694,070	7 886,503		7
	29,341 (13,396) (107,142) 10,920	- 57,872 - (12,085) (1) (211,400) - 13,677		- - (1) -
	(80,277)	(1) (151,936)		(1)
	613,793 107,692	6 734,567 1 136,389		6 1
	506,101	5 598,178		5
	(4,310) -	- (1,911) - -		- -
	(4,310)	- (1,911)		-
	(41,909) 10,579 6,101	- 25,495 - (51,962) - (2,824)		- - -
	(25,229)	- (29,291)		-
	(29,539)	- (31,202)		-
	$ 476,562	5 $ 566,976		5
	$	2.26 $		2.67
	$	2.23 $		2.61

The accompanying notes are an integral part of the financial statements. Chairman: Jing-Rong Tang President: Jing-Rong Tang Accountant Manager: Shu-Ying Chang

~ 44 ~

HOLY STONE ENTERPRISE COMPANY LIMITED

Statements of Changes in Stockholders’ Equity

For the years ended December 31, 2016, 2015

(Expressed in Thousands of New Taiwan Dollars)

Beginning Balance, January 1, 2015 Net Income Other Comprehensive Income Total Comprehensive Income Appropriation of Retained Earnings Provision for Legal Reserve Cash Dividend for Common Stock Conversion of Convertible Bond Share of profit (loss) of associates and joint ventures accounted for using equity method Ending Balance, December 31, 2015 Net Income Other Comprehensive Income Total Comprehensive Income Appropriation of Retained Earnings Provision for Legal Reserve Cash Dividend for Common Stock Share of profit (loss) of associates and joint ventures accounted for using equity method Ending Balance, December 31, 2016			Equity Attributable to Stockholders of Parent Company	Equity Attributable to Stockholders of Parent Company	Equity Attributable to Stockholders of Parent Company	Equity Attributable to Stockholders of Parent Company
	Common Stock	Capital Surplus 3,588,009 - - - - - 20,100 135 3,608,244 - - - - - (41,174) 3,567,070	Retained Earnings Legal Reserve Unappropriated Earnings 1,071,291 1,382,626 - 598,178 - (1,911) - 596,267 90,441 (90,441) - (737,709) - - - - 1,161,732 1,150,743 - 506,101 - (4,310) - 501,791 59,817 (59,817) - (560,538) - - 1,221,549 1,032,179*		Other Equity Exchange Differences on Translation Unrealized Gain (Loss) on Of financial Statements of Foreign Operations Available-for-sale Financial Products 24,645 206,500 - - 21,162 (50,453) 21,162 (50,453) - - - - - - - - 45,807 156,047 - - (32,527) 7,298 (32,527) 7,298 - - - - - - 13,280 163,345		Total Equity 8,508,552 598,178 (31,202) 566,976 - (737,709) 26,773 135 8,364,727 506,101 (29,539) 476,562 - (560,538) (41,174) 8,239,577
						Unrealized Gain (Loss) on Available-for-sale Financial Products 206,500 - (50,453) (50,453) - - - - 156,047 - 7,298 7,298 - - - 163,345
				Unappropriated Earnings 1,382,626 598,178 (1,911) 596,267 (90,441) (737,709) - - 1,150,743 506,101 (4,310) 501,791 (59,817) (560,538) - 1,032,179*
	$ 2,235,481 - - - - - 6,673 - 2,242,154 - - - - - - $ 2,242,154

Note: Remuneration of directors and supervisors of NT$14,030, NT$16,790 and employee benefit of NT$73,655 and NT$88,148 as of 2016 and 2015, respectively, have been deducted from Comprehensive Income Statement

The accompanying notes are an integral part of the financial statements. Chairman: Jing-Rong Tang

President: Jing-Rong Tang

Accountant Manager: Shu-Ying Chang

~ 45 ~

English Translations of Financial Statements Originally Issued in Chinese HOLY STONE ENTERPRISE COMPANY LIMITED

Statements of Cash Flows

For the years ended December 31, 2016 and 2015

(Expressed in Thousands of New Taiwan Dollars)

Cash Flows generated from Operating activities: Income before Income Tax Adjusted Items: Incomes or Expenses Depreciation Bad Debt(Turnover) Interest Expense Interest Income Gains or Losses from Subsidiary Using Equity Method Gain or Losses on Disposal and Scrap of Property, Plant and Equipment Gain or Losses on Non-Financial Assets Unrealized Gains and Losses on Sales Total Incomes or Expenses Change in Assets and Liabilities related to Operating Activities: Change in Assets related to Operating Activities: Financial Assets at Fair Value through Profit or Loss - Current Account and Notes Payable Accounts Payable - Related Parties Other Receivables Inventory Prepaid Expenses and Other Current Assets Total Change in Liabilities related to Operating Activities: Accounts Payable Accounts Payable - Related Parties Other Payables Accrued Pension Liabilities Total Total Adjustment from Change in Assets and Liabilities related to Operating Activities Total Adjusted Items Cash Flow generated from Operations Interest Collected Dividends Collected Interest Paid Income Tax Paid Net Cash Flows generated from Operating activities Cash Flows generated from Investing Activities: Sale of Financial Assets carried at Cost Acquisition of Property and Equipments Sale of Property and Equipments Decrease in Other Noncurrent Assets Net Cash Flows generated from (used in) Investing Activities Cash Flows generated from Financing Activities: Increase (Decrease) in Short-term Loans Repayments on Corporate Bonds Increase (Decrease) in Other Noncurrent Liabilities Cash Dividend Distribution Net Cash Flows used in Financing Activities Increase (Decrease) in Cash and Cash in Banks of Current Period Cash and Cash in Banks at Beginning of the Period Cash and Cash in Banks at End of the Period	2016 $ 613,793	2015 734,567
	244,984 - 13,396 (10,920) 107,142 (7,657) 4,915 5,751	267,244 506 12,085 (13,677) 211,400 1,934 - (7,351)
	357,611	472,141
	463,479 (89,175) (114,363) (72,257) (71,301) (9,685)	39,107 507,919 (173,399) 10,951 338,481 2,518
	106,698	725,577
	33,666 6,042 (22,638) (1,346)	(115,532) 6,767 (24,699) (900)
	15,724	(134,364)
	122,422	591,213
	480,033	1,063,354
	1,093,826 11,784 - (12,612) (153,860)	1,797,921 14,575 15,250 (11,934) (176,395)
	939,138	1,639,417
	- (60,991) 8,203 1,950	(24,246) (64,240) 1,959 (56)
	(50,838)	(86,583)
	372,872 - 3 (560,538)	(496,687) (75,699) 1 (737,709)
	(187,663)	(1,310,094)
	700,637 1,649,931	242,740 1,407,191
	$ 2,350,568	1,649,931

The accompanying notes are an integral part of the financial statements. Chairman: Jing-Rong Tang President: Jing-Rong Tang

President: Jing-Rong Tang

Accountant Manager: Shu-Ying Chang

~ 46 ~

【 Attachment 6 】

English Translation of a Report Originally Issued in Chinese Independent Auditors' Report

The Board of Directors and Shareholders

Holy Stone Enterprise Company Limited

Opinion

We have audited the financial statements of Holy Stone Enterprise Company Limited , which comprise the financial statements for the parent company and its subsidiaries (“the Company”). The financial statements for the parent company and its subsidiaries comprise the statement of financial position as at 31 December 2016, and 2015, the statement of income, the statement of comprehensive income, the statements of cash flows and changes in equity for the year then ended and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the financial statements of the Company have been prepared in accordance with laws and regulations and present fairly, in all material respects, the financial position of the Company as at 31 December 2016 and 2015 and their financial performance for the year then ended in accordance with Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

Basis for Opinion

We conducted our audit in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with The Norm of professional Ethics for Certified Public Accountant of the Republic of China, and we have fulfilled our ethical responsibilities as required by law and regulations. We have also complied with our other ethical obligations in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Other Information

Part of Holy Stone Enterprise Company Limited’s investment that accounted under equity method was audited by other accountants. Therefore, the amount of partial Company financial statement among our opinion on these financial statements was according to other accountants’ auditor’s report. As of December

~ 47 ~

31, 2016 and 2015, the investment amounts accounted under equity method made up 2.61% and 2.44% of total assets, respectively; the gains or losses from subsidiaries accounted under equity method for the year ended December 31, 2016 and 2015 made up 0.27% and 0.11% of Net income before tax, respectively.

Key Audit Matters

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

Revenue Recognition

Refer to the note 4.11 and 6.16 for more details on Unconsolidated Financial Statements.

The Company’s revenue is primarily generated from the provision of multilayer ceramic capacitors, integrated circuits, modules, and other electronic components. We identified revenue recognition as a key audit matter because revenue is one of the key performance indicators of the Company. We evaluated the design and execution of internal control system, revenue analysis of top 10 trading partners, key reconciliations to assess the completeness and accuracy of revenue, including testing the period in which it is reported.

Valuation of Accounts Receivable

Refer to the note 4.6.4, 5.1, and 6.5 for more details on Unconsolidated Financial Statements. The Company’s accounts receivable evaluation is based on collectability. Due to high volatility of the industry, it is uncertain to have enough of information of collectability before the Unconsolidated Financial Statements is reported. In addition, the evaluation of collectability involves professional judgment from the management. Therefore, we identified accounts receivable as a key audit matter.

Valuation of Inventories

Refer to the note 4.7, 5.2, and 6.6 for more details on Unconsolidated Financial Statements. Inventory is carried in the Financial Statements at the lower of cost and net realisable value. Sales in the electronic components industry can be extremely volatile with consumer demand changing significantly based on current trends. As a result there is a risk that the carrying value of inventory exceeds its net realisable value.

Our audit procedures were designed to challenge the reasonableness of the Company’s provisions against impairment of inventory, assessing the hypothesis of allowance for inventory valuation and obsolescence losses from previous years; check if the Company adopts the valuation of inventories; check inventory age report and analyze the pattern; look into the pattern of selling price and market value of inventories to

~ 48 ~

evaluate the reasonableness of net realisable value; evaluate the legitimacy of the disclosure of allowance for inventory valuation.

Valuation of of investment using equity method

Refer to the note 4.8, 5.3, and 6.7 for more details on Unconsolidated Financial Statements.

We identified Valuation of of investment using equity method as a key audit matter, as the ending balance of investment using equity method as of December 31st, 2016 made up 19% of consolidated total assets. Our audit procedures were designed to understand the internal control system of investment using equity method; check for discrepancy of the investment amount; check if the ownership ratio is correct; check for discrepancy of the cost and net value of stocks, and check if adequate procedures are taken to deal with any change of unrealized gain/loss and stockholders’ equity of the investee company; evaluate if there is any impairment occurred and the reasonableness of future discounted cash flow from investee company.

Responsibilities of management for the financial statements

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

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

Those charged with governance (including members of the Audit Committee) are responsible for overseeing the Company’s financial reporting process.

Auditor’s responsibilities for the audit of the financial statements

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

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

1. identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that

~ 49 ~

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

1. obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control;

2. evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management;

3. conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern;

4. evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

5. obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion

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

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

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

~ 50 ~

reasonably be expected to outweigh the public interest benefits of such communication.

KPMG

Accountants:

Taipei, Taiwan Republic of China March 15, 2017

~ 51 ~

English Translations of Consolidated Financial Statements Originally Issued in Chinese

HOLY STONE ENTERPRISE COMPANY LIMITED AND SUBSIDIARIES

Consolidated Balance Sheets

December 31, 2016, 2015

(Expressed in Thousands of New Taiwan Dollars)

Assets Current Assets: 1100Cash and Cash Equivalents (Note6.1) 1110Financial Assets at Fair Value through Profit or Loss - Current (Note6.2) 1150Notes and Accounts Receivable, net (Note6.5&7) 1200Other Receivables (Note6.5) 130XInventories (Note6.6) 1410Prepaid Expenses and Other Current Assets Total Current Assets Noncurrent Assets: 1523Available-for-sale Financial Assets - Noncurrent (Note6.3) 1543Financial Assets Carried at Cost - Noncurrent (Note6.4) 1600Property, Plant and Equipment (Note6.7&8) 1780 Intangible Assets (Note 6.8) 1840Deferred Income Tax Assets (Note6.13) 1915Prepaid Expense on Equipment 1990Other Noncurrent Assets - Others (Note 8) Total Noncurrent Assets Total Assets	2016.12.31 2015.12.31 Amount ％ Amount ％ $ 3,406,289 28 2,905,532 24 92,368 1 618,567 5 3,398,021 28 3,046,660 25 152,948 1 54,669 - 1,805,964 15 1,705,637 14 43,226 - 37,327 -
	8,898,816 73 8,368,392 68
	381,162 3 320,671 3 317,987 3 420,855 3 2,406,685 19 2,629,430 22 254,298 2 314,614 3 32,265 - 29,079 - 10,051 - 18,057 - 23,220 - 74,140 1
	3,425,668 27 3,806,846 32 $ 12,324,484 100 12,175,238 100

Liabilities and Equity Current Liabilities: 2100Short-term Loans (Note6.9) 2170Accounts Payable 2180Accounts Payable - Related Parties (Note7) 2200Other Payables 2230Current Portion Income Tax Liability 2322 Current Portion of Long-term Loans (Note 6.10&8) Total Current Liabilities Noncurrent Liabilities: 2540Long-term Loans (Note 6.10&8) 2570Deferred Income Tax Liabilities (Note 6.13) 2640Accrued Pension Liabilities-Noncurrent (Note6.12) 2670Other Noncurrent Liabilities – Others Total Noncurrent Liabilities Total Liabilities Equity Attributable to Parent Company (Note6.11, 6.12&6.14): 3110Common Stock 3200Capital Surplus Retained Earnings: 3310 Legal Reserve 3350 Unappropriated Earnings Total Retained Earnings Other Equity: 3410 Exchange Differences on Translation of Financial Statements of Foreign Operations 3425 Unrealized gains and losses on Available-for-sale Financial Assets Total Other Equity Total Equity to Parent Company 36XXNon-controlling Interest Total Equity Total Liabilities and Equity	2016.12.31 Amount % $ 1,663,059 14 1,064,785 9 26,411 - 581,749 5 45,301 - 2,171 -	2015.12.31 Amount % 1,300,187 11 1,052,056 9 19,701 - 599,627 5 75,485 2 2,122 -
	3,383,476 28	3,049,178 27
	17,058 - 28,464 - 59,738 - 2,868 -	19,240 - 45,752 - 56,774 - 2,301 -
	108,128 -	124,067 -
	3,491,604 28	3,173,245 27
	2,242,154 18	2,242,154 18
	3,567,070 29	3,608,244 30
	1,221,549 10 1,032,179 9	1,161,732 10 1,150,743 9
	2,253,728 19	2,312,475 19
	13,280 - 163,345 1	45,807 - 156,047 1
	176,625 1	201,854 1
	8,239,577 67	8,364,727 68
	593,303 5	637,266 5
	8,832,880 72	9,001,993 73
	$ 12,324,484 100	12,175,238 100

The accompanying notes are an integral part of the financial statements. Chairman: Jing-Rong Tang

Accountant Manager: Shu-Ying Chang

President: Jing-Rong Tang

~ 52 ~

English Translations of Consolidated Financial Statements Originally Issued in Chinese

HOLY STONE ENTERPRISE COMPANY LIMITED AND SUBSIDIARIES

Consolidated Statements of Income

For the years ended December 31, 2016, 2015

(Expressed in Thousands of New Taiwan Dollars, except earnings per share)

4000 Net Sales(Note6.17&7) 5000 Cost of Goods Sold(Note6.12&7) Gross Profit Operating Expense 6100 Selling and Administrative (Note 6.12) 6300 Research and Development (Note 6.12) Total Operating Expense Operating Income Non-Operating Income and Expenses 7020 Other Gains and Losses (Note 6.4, 6.8, 6.11, 6.19&12.2) 7050 Financial Costs (Note 6.11) 7100 Interest Income Total Non-Operating Income and Expenses 7900 Income before Income Tax 7950 Less: Income Tax Expense(Note6.13) Net Income for Current Period 8300 Other Comprehensive Gains and Losses: 8310 Revaluation income 8311 Defined benefit plan 8349 Income Tax incurred Total Revaluation income 8360 Revaluation income arising from reclassification 8361 Exchange Differences on Translation of Financial Statements of Foreign Operations 8362 Unrealized Valuation Gains (Loss) on Available-for-sale Financial Assets 8399 Income Tax related to reclassification Total Revaluation income arising from reclassification 8300 Other Comprehensive Income for Current Period (after tax) Total Comprehensive Income for Current Period Net Income attributed to 8610 Parent Company 8620 Non-controlling Interest Comprehensive Income attributed to 8610 Parent Company 8620 Non-controlling Interest Earnings per Share(Note 6.16) 9750 Basic Earnings per Share (Unit: NT Dollar) 9850 Diluted Earnings per Share (Unit: NT Dollar)**	2016		2015 Amount 13,595,819 11,629,937	％ 100 85 15 8 2 10 5 - - - - 5 (1) 4 - - - - (1) - (1) (1) 3 5 (1) 4 4 (1) 3
	Amount $ 13,166,572 11,261,662	％
		100 86
	1,904,910	14	1,965,882
	1,158,620 304,832	9 2	1,091,260 240,128
	1,463,452	11	1,331,388
	441,458	3	634,494
	11,940 (16,143) 17,668	- - -	(28,341) (15,859) 24,344
	13,465	-	(19,856)
	454,923 (116,802)	3 (1)	614,638 (142,852)
	338,121	2	471,786
	(4,310) -	- -	(1,911) -
	(4,310)	-	(1,911)
	(45,687) 9,117 6,101	- - -	27,819 (83,558) (2,824)
	(30,469)	-	(58,563)
	(34,779)	-	(60,474)
	$ 303,342	2	411,312
	$ 506,101 (167,980)	3 (1)	598,178 (126,392)
	$ 338,121	2	471,786
	$ 476,562 (173,220)	3 (1)	566,976 (155,664)
	$ 303,342	2	411,312
	$ 2.26		2.67
	$ 2.23		2.61

The accompanying notes are an integral part of the financial statements. Chairman: Jing-Rong Tang

Accountant Manager: Shu-Ying Chang

President: Jing-Rong Tang

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English Translations of Consolidated Financial Statements Originally Issued in Chinese

HOLY STONE ENTERPRISE COMPANY LIMITED AND SUBSIDIARIES

Consolidated Statements of Changes in Stockholders’ Equity

For the years ended December 31, 2016, 2015

(Expressed in Thousands of New Taiwan Dollars)

Beginning Balance, January 1, 2015 Net Income Other Comprehensive Income Total Comprehensive Income Appropriation of Retained Earnings Provision for Legal Reserve Cash Dividend for Common Stock Conversion of Convertible Bond Share of profit (loss) of associates and joint ventures accounted for using equity method Non-controlling Interest Ending Balance, December 31, 2015 Net Income Other Comprehensive Income Total Comprehensive Income Appropriation of Retained Earnings Provision for Legal Reserve Cash Dividend for Common Stock Share of profit (loss) of associates and joint ventures accounted for using equity method Change in Non-controlling Interest Ending Balance, December 31, 2016			Equity	Attributable to Stockholders	of Parent Company	of Parent Company	Total Equity Attributable to Stockholders of Parent Company Non-Controlling Equity*	Total Equity 9,315,221
	Common Stock	Capital Surplus	Retained	Earnings	Other Equity Exchange Differences on Translation Of financial Unrealized Gain (Loss) On Statements of Foreign Operations Available-for-sale Financial Products 24,645 206,500
						Unrealized Gain (Loss) On Available-for-sale Financial Products
			Legal Reserve	Unappropriated Earnings*
	$ 2,235,481	3,588,009	1,071,291	1,382,626 598,178 (1,911) 596,267 (90,441) (737,709) - - - 1,150,743 506,101 (4,310) 501,791 (59,817) (560,538) - - 1,032,179		206,500	8,508,552 806,669
	- -	- -	- -		- 21,162	- (50,453)	598,178 (126,392) (31,202) (29,272)	471,786 (60,474)
	-	-	-		21,162	(50,453)	566,976 (155,664)	411,312
	- - 6,673 - -	- - 20,100 135 -	90,441 - - - -		- - - - -	- - - - -	- - (737,709) - 26,773 - 135 - - (13,739)	- (737,709) 26,773 135 (13,739)
	2,242,154	3,608,244	1,161,732		45,807	156,047	8,364,727 637,266	9,001,993
	- -	- -	- -		- (32,527)	- 7,298	506,101 (167,980) (29,539) (5,240)	338,121 (34,779)
	-	-	-		(32,527)	7,298	476,562 (173,220)	303,342
	- - - -	- - (41,174) -	59,817 - - -		- - - -	- - - -	- - (560,538) - (41,174) - - 129,257	- (560,538) (41,174) 129,257
	$ 2,242,154	3,567,070	1,221,549		13,280	163,345	8,239,577 593,303	8,832,880

The accompanying notes are an integral part of the financial statements. Chairman: Jing-Rong Tang

Accountant Manager: Shu-Ying Chang

President: Jing-Rong Tang

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English Translations of Consolidated Financial Statements Originally Issued in Chinese

HOLY STONE ENTERPRISE COMPANY LIMITED AND SUBSIDIARIES

Consolidated Statement of Cash Flows

For the years ended December 31, 2016, 2015

(Expressed in Thousands of New Taiwan Dollars)

Cash Flows generated from Operating activities: Income before Tax Adjusted Items: Incomes or Expenses Depreciation Amortization Bad Debt(Turnover) Financial Assets at Fair Value through Profit or Loss Interest Expense Interest Income Dividend Income Gain or Losses on Disposal and Scrap of Property, Plant and Equipment Gain or Losses on Investments Gain or Losses on Non-Financial Assets Total Incomes or Expenses Change in Assets and Liabilities related to Operating Activities: Change in Assets related to Operating Activities: Financial Assets at Fair Value through Profit or Loss - Current Account and Notes Receivable Other Receivables Inventory Prepaid Expenses and Other Current Assets Total Change in Liabilities related to Operating Activities: Accounts Payable Accounts Payable - Related Parties Other Payables Accrued Pension Liabilities Total Total Adjustment from Change in Assets and Liabilities related to Operating Activities Total Adjusted Items Cash Flow generated from Operations Interest Collected Dividends Collected Interest Paid Income Tax Paid Net Cash Flows generated from Operating activities Cash Flows generated from Investing Activities: Sales of Financial Assets Available for Sale Acquisition of Financial Assets carried at Cost Sale of Financial Assets carried at Cost Return from Capital Reduction of Financial Assets carried at Cost Acquisition of Property and Equipments Sale of Property and Equipments Acquisition of Intangible Assets Decrease in Other Noncurrent Assets Net Cash Flows generated from (used in) Investing Activities Cash Flows generated from Financing Activities: Increase (Decrease) in Short-term Loans Repayments on Corporate Bonds Repayments on Long-Term Debts Increase (Decrease) in Non-Current Liabilities Cash Dividend Distribution Change in Non-Controlling Equity Net Cash Flows used in Financing Activities Foreign Exchange Impact on Cash and Cash Equivalents Increase (Decrease) in Cash and Cash in Banks of Current Period Cash and Cash in Banks at Beginning of the Period Cash and Cash in Banks at End of the Period	2016 $ 454,923	2015 614,638 307,786 3,418 (6,293) (36,167) 15,859 (24,344) (29,183) 2,335 (11,986) 175,192 396,617 284,355 377,074 13,410 347,539 11,312 1,033,690 (35,333) (8,635) (47,039) (900) (91,907) 941,783 1,338,400 1,953,038 25,319 29,183 (14,882) (229,672) 1,762,986 9,422 (53,953) 22,407 - (104,192) 2,425 (771) 30,180 (94,482) (516,687) (75,699) (2,081) (82) (737,709) (13,386) (1,345,644) 14,840 337,700 2,567,832 2,905,532
	285,733 3,310 (368) - 16,143 (17,668) (23,787) (7,642) - 56,535
	312,256
	526,199 (350,199) (98,385) (100,327) (5,899)
	(28,611)
	12,729 6,710 (18,675) (1,346)
	(582)
	(29,193)
	283,063
	737,986 17,774 23,787 (15,346) (161,359)
	602,842
	- (5,991) 15,000 42,340 (66,544) 8,209 (541) 49,573
	42,046
	362,872 - (2,133) 567 (560,538) 78,702
	(120,530)
	(23,601)
	500,757 2,905,532
	$ 3,406,289

The accompanying notes are an integral part of the financial statements. Chairman: Jing-Rong Tang

Accountant Manager: Shu-Ying Chang

President: Jing-Rong Tang

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【 Attachment 7 】

Holy Stone Enterprise Co., Ltd. Earnings Distribution Table

December 31, 2016

Unit: NT$

		Unit: NT$
Item	Amount	Total Amount
Net Income of 2016 Less：Legal Reserve Earning in 2016 Available for Distribution Beginning Unappropriated retained earnings Plus：Other comprehensive loss for current period Plus：Beginning Unappropriated retained earnings Total Earning in 2016 Available for Distribution Less：Distribution Item Cash Dividends Ending Unappropriated retained earnings	506,101,251 50,610,125	455,491,126 526,076,804
	530,386,941 ( 4,310,137 )
		981,567,930 448,430,796
		533,137,134

1.The outstanding shares are 224,215,398 shares which are based on February 28, 2017.

2.As a result of the cash capital increase, treasury shares buy back or to transfer and cancellation of treasury shares, convertible bonds creditor to perform the conversion rights, or employees by way of warrants execution rights, and or other factors, so that when the impact of the company's total outstanding number of shares, the Board of Directors under this resolution of the meeting of shareholders will adjust the distribution ratio, according to the actual number of outstanding shares of the distribution record date.

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【 Attachment 8 】

Holy Stone Enterprise Co., Ltd.

Comparison Table for Amendment to the Guidelines for Handling Acquisition and Disposal of

Assets.

No.	Post-Amendment	Pre-Amendment	Explanation
Article 6	The procedure for Handling Acquisition and Disposal of Assets： （1）The assessment: The Company acquires or disposes assets in accordance with the internal control system and the cyclic process of Property, Plant, and Equipment. (Omitted) (4) In acquiring or disposing of real property or equipment where the transaction amount reaches 20 percent of the company's paid-in capital or NT$300 million or more, the company, unless transacting with a government agency, engaging others to build on its own land, engaging others to build on rented land, or acquiring or disposing of equipment for business use, shall obtain an appraisal report prior to the date of occurrence of the event from a professional appraiser and shall further comply with the following provisions: (Omitted)	The procedure for Handling Acquisition and Disposal of Assets： （1）The assessment: The Company acquires or disposes assets in accordance with the internal control system and the cyclic process of Fixed Assets. (Omitted) (4)In acquiring or disposing of real property or equipment where the transaction amount reaches 20 percent of the company's paid-in capital or NT$300 million or more, the company, unless transacting with a government agency, engaging others to build on its own land, engaging others to build on rented land, or acquiring or disposing of equipment for business use, shall obtain an appraisal report prior to the date of occurrence of the event from a professional appraiser and shall further comply with the following provisions: (Omitted)	According to the governing law and regulations
Article 8	The procedure for Handling Acquisition and Disposal of loyalty card or intangible assets： （1）The assessment: The Company	The procedure for Handling Acquisition and Disposal of loyalty card or intangible assets： （1）The assessment: The Company	According to the governing law and

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No.	Post-Amendment	Pre-Amendment	Explanation
	acquires or disposes assets in accordance with the internal control system and the cyclic process of Property, Plant, and Equipment. (Omitted) (4)Assessment report loyalty card or intangible assets (a)In acquiring or disposing of intangible assets where the transaction amount reaches 20 percent of the company's paid-in capital or NT$300 million or more, the company, unless transacting with a government agency, engaging others to build on its own land, engaging others to build on rented land, or acquiring or disposing of equipment for business use, shall obtain an appraisal report prior to the date of occurrence of the event from a professional appraiser and shall further comply with the following provisions: (Omitted)	acquires or disposes assets in accordance with the internal control system and the cyclic process of Fixed Assets. (Omitted) (4)Assessment report loyalty card or intangible assets (a)In acquiring or disposing of intangible assets where the transaction amount reaches 20 percent of the company's paid-in capital or NT$300 million or more, the company, unless transacting with a government agency, engaging others to build on its own land, engaging others to build on rented land, or acquiring or disposing of equipment for business use, shall obtain an appraisal report prior to the date of occurrence of the event from a professional appraiser and shall further comply with the following provisions: (Omitted)	regulations
Article 9	The procedure for trading with related party： 1.When a public company intends to acquire or dispose of assets to a related party, except for complying with article 6, 7, and 8 to acquire or dispose of loyalty card or intangible assets,the Companyshall acquire	The procedure for trading with related party： 1.When a public company intends to acquire or dispose of assets to a related party, except for complying with article 6, 7, and 9 to acquire or dispose of loyalty card or intangible assets,the Companyshall acquire	According to the governing law and regulations

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No.	Post-Amendment	Pre-Amendment	Explanation
	assessment and CPA opinions according to article 6, 7, and 8. 2.When a public company intends to acquire or dispose of real property from or to a related party, or when it intends to acquire or dispose of assets other than real property from or to a related party and the transaction amount reaches 20 percent or more of paid-in capital, 10 percent or more of the company's total assets, or NT$300 million or more, except in trading of government bonds or bonds under repurchase and resale agreements, or subscription or redemption of domestic money market funds, the company may not proceed to enter into a transaction contract or make a payment until the following matters have been approved by the board of directors and recognized by the supervisors: (Omitted)	assessment and CPA opinions according to article 6, 7, and 9. 2.When a public company intends to acquire or dispose of real property from or to a related party, or when it intends to acquire or dispose of assets other than real property from or to a related party and the transaction amount reaches 20 percent or more of paid-in capital, 10 percent or more of the company's total assets, or NT$300 million or more, except in trading of government bonds or bonds under repurchase and resale agreements, or subscription or redemption of domestic money market funds, the company may not proceed to enter into a transaction contract or make a payment until the following matters have been approved by the board of directors and recognized by the supervisors: (Omitted)
Article 11	The procedure for merger, demerger, acquisition, or transfer of shares: 1.Assessment and procedure: The Company conducts a merger, demerger, acquisition, or transfer of shares, prior to convening the board of directors to resolve on the matter, shall engage a CPA, attorney, or securities underwriter to give an opinion on the reasonableness of the share exchange ratio,acquisition	The procedure for merger, demerger, acquisition, or transfer of shares: Assessment and procedure: The Company conducts a merger, demerger, acquisition, or transfer of shares, prior to convening the board of directors to resolve on the matter, engages a CPA, attorney, or securities underwriter to give an opinion on the reasonableness of the share exchange ratio, acquisition price,or distribution of cash or other	According to the governing law and regulations

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No.	Post-Amendment	Pre-Amendment	Explanation
	price, or distribution of cash or other property to shareholders, and submit it to the board of directors for deliberation and passage. The subsidiaries 100% owned directly or indirectly by the Company are exempt from the opinions above. (Omitted)	property to shareholders, and submit it to the board of directors for deliberation and passage. (Omitted)
Article 12	The procedure for disclosing information: 1.Public disclosure of information and its standard: (1)Acquisition or disposal of real property from or to a related party, or acquisition or disposal of assets other than real property from or to a related party where the transaction amount reaches 20 percent or more of paid-in capital, 10 percent or more of the company's total assets, or NT$300 million or more; provided, this shall not apply to trading of government bonds or bonds under repurchase and resale agreements, or subscription or redemption of domestic money market funds. (2)Merger, demerger, acquisition, or transfer of shares. (3)Losses from derivatives trading reaching the limits on aggregate losses or losses on individual contracts set out in the procedures adopted by the Company. (4)Where the type of asset acquired or	The procedure for disclosing information: 1.Public disclosure of information and its standard: (1)Acquisition or disposal of real property from or to a related party, or acquisition or disposal of assets other than real property from or to a related party where the transaction amount reaches 20 percent or more of paid-in capital, 10 percent or more of the company's total assets, or NT$300 million or more; provided, this shall not apply to trading of government bonds or bonds under repurchase and resale agreements, or subscription or redemption of domestic money market funds. (2)Merger, demerger, acquisition, or transfer of shares. (3)Losses from derivatives trading reaching the limits on aggregate losses or losses on individual contracts set out in the procedures adopted by the company. (4)Where an asset transaction other than	According to the governing law and regulations

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No.	Post-Amendment	Pre-Amendment	Explanation
	disposed is equipment/machinery for business use, the trading counterparty is not a related party, and the transaction amount is less than NT$500 million. (5)Where land is acquired under an arrangement on engaging others to build on the company's own land, engaging others to build on rented land, joint construction and allocation of housing units, joint construction and allocation of ownership percentages, or joint construction and separate sale, and the amount the company expects to invest in the transaction is less than NT$500 million. (6)Where an asset transaction other than any of those referred to in the preceding 5 items, a disposal of receivables by a financial institution, or an investment in the mainland China area reaches 20 percent or more of paid-in capital or NT$300 million; provided, this shall not apply to the following circumstances: (a)Trading of government bonds. (b)Trading of bonds under repurchase/resale agreements, or subscription or redemption of domestic money market funds. (7)"Within the preceding year" as used in the preceding 6 items refers to the yearprecedingthe date of	any of those referred to in the preceding 5 items, a disposal of receivables by a financial institution, or an investment in the mainland China area reaches 20 percent or more of paid-in capital or NT$300 million; provided, this shall not apply to the following circumstances: (a)Trading of government bonds. (b)Trading of bonds under repurchase/resale agreements, or subscription or redemption of domestic money market funds. (c)Where the type of asset acquired or disposed is equipment/machinery for business use, the trading counterparty is not a related party, and the transaction amount is less than NT$500 million. (d)Where land is acquired under an arrangement on engaging others to build on the Company's own land, engaging others to build on rented land, joint construction and allocation of housing units, joint construction and allocation of ownership percentages, or joint construction and separate sale, and the amount the Company expects to invest in the transaction is less than NT$500 million. (5)"Within the preceding year" as used in the preceding 4 items refers to the yearprecedingthe date of

~ 28 ~

No.	Post-Amendment	Pre-Amendment	Explanation
	occurrence of the current transaction. Items duly announced in accordance with these Regulations need not be counted toward the transaction amount. (a)The amount of any individual transaction. (b)The cumulative transaction amount of acquisitions and disposals of the same type of underlying asset with the same trading counterparty within the preceding year. (c)The cumulative transaction amount of real property acquisitions and disposals (cumulative acquisitions and disposals, respectively) within the same development project within the preceding year. (d)The cumulative transaction amount of acquisitions and disposals (cumulative acquisitions and disposals, respectively) of the same security within the preceding year. (Omitted) 3.Procedure for public disclosure: (1)The Company shall file for public disclosure to specified website. (2)The Company shall compile monthly reports on the status of derivatives trading engaged in up to the end of the preceding month by itself and any subsidiaries that are not domestic public companies and enter the information in the prescribed format into the	occurrence of the current transaction. Items duly announced in accordance with these Regulations need not be counted toward the transaction amount. (a)The amount of any individual transaction. (b)The cumulative transaction amount of acquisitions and disposals of the same type of underlying asset with the same trading counterparty within the preceding year. (c)The cumulative transaction amount of real property acquisitions and disposals (cumulative acquisitions and disposals, respectively) within the same development project within the preceding year. (d)The cumulative transaction amount of acquisitions and disposals (cumulative acquisitions and disposals, respectively) of the same security within the preceding year. (Omitted) 3.Procedure for public disclosure: (1)The Company shall file for public disclosure to specified website. (2)The Company shall compile monthly reports on the status of derivatives trading engaged in up to the end of the preceding month by itself and any subsidiaries that are not domestic public companies and enter the information in the prescribed format into the

~ 29 ~

No.	Post-Amendment	Pre-Amendment	Explanation
	information reporting website designated by the FSC by the 10th day of each month. (3)When a public company at the time of public announcement makes an error or omission in an item required by regulations to be publicly announced and so is required to correct it within 2 days, all the items shall be again publicly announced and reported in their entirety. (Omitted)	information reporting website designated by the FSC by the 10th day of each month. (3)When a public company at the time of public announcement makes an error or omission in an item required by regulations to be publicly announced and so is required to correct it, all the items shall be again publicly announced and reported in their entirety. (Omitted)
Article 16	Supplementary Provision 1. Any matters not set forth herein shall be governed by the applicable laws and regulations. 2. Guideline was established on November 5, 1998. (Omitted) The 6thamendment was made on June 11th, 2014. The 7thamendment was made on June 7th,2017	Supplementary Provision 1.Any matters not set forth herein shall be governed by the applicable laws and regulations. 2.Guideline was established on November 5, 1998. The 1st amendments to 5th (Omitted) The 6thamendment was made on June 11th, 2014.	Amending date

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