K LASER - AGM Information 2021 | FinancialReports.eu

K LASER TECHNOLOGY INC.

2021 Annual Shareholder’s Meeting Minutes

Time and Date: 9:00 a.m., July 2, 2021

Place: GIS HSP Convention Center

Edison, 2F, No.1, Gongye E. 2nd Rd., East Dist.,Hsinchu City 300, Taiwan

Total outstanding shares: 150,229,631 shares

Total shares represented by shareholders present in person or by proxy:84,787,435 shares Percentage of shares held by shareholders present in person or by proxy: 56.43%

Attendance: Bi-Xin Huang / Independent Director (Video conference)

Gen-Sen Chang-Hsieh/ Independent Director (Video conference)

Ren Liu/ Independent Director (Video conference)

Peggy Cheng / Deloitte & Touche (Video conference)

Grace Yu / Chen & Lin Attorneys -At- Law (Video conference)

Directors present: Alex Kuo, Daniel Kuo, Lisa Hsu

Chairman: Alex Kuo , the Chairman of the Board of Directors

Recorder: Mei Ling Ho

The aggregate shareholding of the shareholders present in person or by proxy constituted a quorum. The Chairman called the meeting to order.

A. Chairman Address (omitted)

B. Report Items

I. Reported the business of 2020 (see attachment).
II. Audit Committee’s review report (see attachment).
III. Reported 2020 employee’s profit sharing bonus and directors’ compensation.
In accordance with Article 32 of the Corporation Bylaws, if the company makes profit in this year, it shall allocate 4% to 8% of the net profit before tax as remuneration for employees and no more than 2% as remuneration for directors, and the board of directors shall decide to distribute the case and submit it to the shareholders' meeting for report. However, if the company still has accumulated losses, it shall reserve the compensation amount in advance, and then allocate the remuneration of employees and directors according to the proportion mentioned in the preceding paragraph.
Through the resolution of the Board of Directors, 8% of employees' remuneration accrued as NT$ 13,370 thousand in total and 2% of directors' remuneration accrued as NT$ 3,342 thousand in 2020, were paid in cash.
IV. Reported 2020 cash dividend.
The Corporation Bylaws of the Company authorize the board of directors to resolve to distribute profit in cash after the end of each quarter.
In the first 3 quarters of 2020, the Company did not distribute cash dividends. In the 4th quarter, the board of directors resolved that the cash dividends distributed to shareholders amounted to NT$ 144,220 thousand, that is, NT$ 0.96 per share.
Cash dividends have been paid out on June 30, 2021.

V. Reported the issuing of domestic secured convertible corporate bonds.

In order to repay the bank loans and strengthen the financial structure, the Company has issued NT$ 600 million in total, and the number of issued shares is 6000, NT$ 100,000 per share, which is issued at 101% of the face value. The 6th domestic secured convertible corporate bonds with an issue period of 5 years have been traded on the counter of securities firms since March 24, 2021

VI. Reported the execution status of treasure stocks in 2020.

Please see the table below.

Item	Purpose of buy-back	Expected shares of buy-back	Buy-back method	Price range	Buy-back period	Actual Shares of buy-back	Total amount of buy-back	Average cost of buy-back
27th	Treasure stocks transferred to staff	6,000 thousand	Buy-back form open market	NT$9.10~ NT$24.31	2020/03/16~ 2020/05/15	6,000 thousand	NT$77,891,133.	NT$12.98

C. Ratification Items

I. The 2020 Business Report and Financial Statements were submitted at the meeting for acceptance. (Proposed by the Board of Directors)

Description:

The Company's financial statements in 2020 have been approved by the Board of Directors and audited by CPA Huang Yimin and CPA Hsu Wenya of Deloitte & Touche. The above financial statements and business report have been submitted to the Audit Committee for checking and issuing an audit report for the record.
Please refer to Attachment for the documents mentioned above.
Resolution:

RESOLVED, that the above proposal be and hereby were accepted as submitted. Voting Results:

Share represented at the time of voting: 82,252,440 (23,898,656)

Voting Results*	Voting Results*	% of the total represented sharepresent
Votes in favor	75,409,749 (17,578,720)	91.68%
Votes against	18,433 (18,433)	0.02%
Votes invalid	-	-
Votes abstained	6,824,261 (6,301,503)	8.29%

including votes casted electronically (numbers in brackets)
II. The 2020 earnings distribution were submitted at the meeting for acceptance. (Proposed by the Board of Directors)

Description:

Please refer to Attachment for the Company's 2020 disposition of net profit.

Resolution:

RESOLVED, that the above proposal be and hereby were accepted as submitted.

Voting Results:

Share represented at the time of voting: 82,252,440 (23,898,656)

Voting Results*	Voting Results*	% of the total represented sharepresent
Votes in favor	75,465,744 (17,634,718)	91.74%
Votes against	18,434 (18,434)	0.02%
Votes invalid	-	-
Votes abstained	6,768,262 (6,245,504)	8.22%

including votes casted electronically (numbers in brackets)

D. Discussion Items

I. It was proposed to approve revision to the “ Corporation Bylaws” of the Company. (Proposed by the Board of Directors)

Description:

To cooperate with the practical needs of the Company, it is proposed to revise the Corporation Bylaws. Please refer to attachment for the Provision Comparison Table Before/After Revision of Corporation Bylaws.

Resolution:

RESOLVED, that the above proposal be and hereby was approved as proposed. Voting Results:

Share represented at the time of voting: 82,252,440 (23,898,656)

Voting Results*	Voting Results*	% of the total represented sharepresent
Votes in favor	75,460,883 (17,629,857)	91.74%
Votes against	18,465 (18,465)	0.02%
Votes invalid	-	-
Votes abstained	6,773,092 (6,250,334)	8.23%

including votes casted electronically (numbers in brackets)
II. It was proposed to approve the Rules of Procedure for Shareholders Meetings. (Proposed by the Board of Directors)

Description:

To cooperate with the practical needs of the Company, it is proposed to revise the Rules of Procedure for Shareholder Meeting. Please refer to attachment for the Provision Comparison Table Before/After Rules of Procedure for Shareholder Meeting.

Resolution:

RESOLVED, that the above proposal be and hereby was approved as proposed.

Voting Results:

Share represented at the time of voting: 82,252,440 (23,898,656)

Voting Results*	Voting Results*	% of the total represented sharepresent
Votes in favor	75,460,883 (17,629,857)	91.74%
Votes against	18,469 (18,469)	0.02%
Votes invalid	-	-
Votes abstained	6,773,088 (6,250,330)	8.23%

including votes casted electronically (numbers in brackets)
III. It was proposed to approve the Issuance of restricted employee shares.
(Proposed by the Board of Directors)

Description:

In order to retain and attract the professional talents required by the Company, motivate employees and enhance the centripetal force of employees, and create the common interests of the Company and shareholders, the Company plans to issue new shares with restricted employees' rights in 2021 in accordance with Article 267 of the Company Law and the "Guidelines for the Offering and Issuance of Securities by Publisher" issued by the Financial Supervisory Commission.
This time, it is planned to issue no more than 5,000,000 common shares, NT$ 10.00 per face value, and NT$ 50,000,000 in total, which will be issued free of charge. The board of directors of the company has decided to issue new shares that restrict the rights of employees. The relevant explanations are as follows:
2.1 An employee’s continuous employment with the Company through the vesting dates, no violation on any terms of the Company’s employment agreement, employee handbook, trust deed, Corporate Governance Best Practice Principles, Ethical Corporate Management Best Practice Principles, non-competition and PIM agreements, or the agreement of Restricted Stock Awards, and the achievement of the Company’s operational objectives during the Performance Period are required to receive the vested shares.
2.2 The employee have met the performance business objectives can be vested with on the vesting date each year:
- (1)First year: 15%
- (2)Second year: 15%
- (3)Third year: 20%
- (4)Fourth year: 20%
- (5)Fifth year: 30%
2.3 To protect shareholders’interests, the Company shall cautiously manage the Plan. Only the Company and its subsidiaries’ regular employees who are already employed on the date that Restricted Stock Awards are granted and meet certain performance requirements shall be eligible for the Plan. The awards will be further limited to employees who are:
- (1)highly related to the future strategy and development of the Company (2)key technical talents.
2.4 The number of granted shares shall be determined by seniority, position, performance, overall contribution, special contribution and other meaningful

factors in management. The results of shares distribution shall be reviewed by Chairman and obtain approval in the meeting of the Board of Directors. However, for employees who are managerial officers or the Board members, the award of such shares is subject to approval by the Compensation Committee.

2.5 Employees who possess over 10% of the Company common shares, all the members of the Compensation Committee, and members of the Board who are not employees of the Company shall not be eligible for the Plan.
2.6 The total number of shares granted to each employee shall be in accordance with the applicable laws and regulations in ffering Regulations.
2.7 Calculated expense amount:

The Company shall value the fair market value of shares and record expenses during the vesting period annually. The proposed number of Restricted Stock Awards in 2021 Annual Shareholders’ General Meeting shall not exceed 5,000,000 shares. The actual number of Restricted Stock Awards to be issued, under the estimated maximum expense of NT$99,250K will be calculated with reference to the share price before the issuance. The actual number of Restricted Stock Awards to be issued will be calculated with reference to the share price before the issuance and subject to the Board of Directors ’ approval in accordance with the applicable laws and regulations and further announced accordingly. The amortized expenses are estimated to be in the 、、、、 amount of NT$14,887K NT$14,888K NT$19,850K NT$19,850K NT$29,775K for 2021 、 2022 、 2023 、 2024 and 2025, respectively.

2.8 Dilution of the Company's earnings per share (EPS):
- Based on the calculation of the Company’s outstanding shares, the maximum dilution of the Company's EPS is estimated to be in the amount of NT$0.0991,NT$0.0991, NT$0.1321, NT$0.1321 and NT$0.1982 for 2021, 2022, 2023 , 2024 and 2025, respectively. There is a limited dilution of the Company’s future EPS, and there is no material impact on existing shareholders’ equity.
2.9 Other matters affecting shareholder's equity: NA
The issuance of new shares with restricted employees' rights, related restrictions and important agreed matters or matters not covered shall be handled in accordance with relevant laws and regulations and the issuance method formulated by the Company. Please refer to attachment for the issuance method of new shares with restricted employees' rights.
If the issuance of new shares restricting employees' rights is instructed by the competent authority, amended by relevant laws and regulations, or the objective environment needs to be revised or amended, it is proposed to authorize the chairman of the board to handle it with full authority.

Resolution:

RESOLVED, that the above proposal be and hereby was approved as proposed.

Voting Results:

Share represented at the time of voting: 82,252,440 (23,898,656)

Voting Results*	Voting Results*	% of the total represented sharepresent
Votes in favor	75,278,948 (17,447,922)	91.52%
Votes against	199,433 (199,433)	0.24%
Votes invalid	-	-
Votes abstained	6,774,059 (6,251,301)	8.23%

including votes casted electronically (numbers in brackets)

E. Extraordinary Motions: NA

F. meeting close (at 9:40 am on 7/2/2021)

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“Annex 1”

Business Report

To Shareholders Summary

For the full year 2020, the consolidated sales of K Laser Group grew 5% to 5.43 billion NT dollars. The annual gross profit margin was 24%, and the operating profit jumped more than six-fold to 229million NT dollars. Net profit of 2020 was 144million NT dollars, EPS 0.96.

It is remarkable that we were able to grow our sales revenue and net profit when COVID-19 rages worldwide. Thanks to the fact that we had kept sufficient stock in our channels worldwide, we were able to keep our sales activities going without being disrupted by the pandemic while the improvement of productivity had offset the cost increase resulted from the surge of shipping rates. In addition, with the completion of organization restructuring and the implementation of strict expense control, the expense ratio had decreased 3%. All the above had contributed to the improvement in our financial performance in 2020.

Technology Development

Over the years, we have kept on improving our true-seamless and wide-web products to meet the market demands. We have also strived to drive customer stickiness, and ultimately elevate our overall profit margin through the following practices.

We have dedicated ourselves to improve our design and origination capabilities to provide various unique products with security functions and help customers to achieve desired outcome.
We have directed our research and development efforts to create products that are eco-friendly, resistant to high temperature and humidity, and have high abrasion and folding endurance.
We have continued to embrace the latest technologies to ensure our competitiveness in the security label market.

Our Strategy and Global Situation

Our research and development efforts are influenced by these noteworthy trends.

1.) The plastic waste reduction policy has spurred more and more customers to use eco-friendly materials for packaging.
2.) The plastic waste reduction policy has spurred more and more customers to use eco-friendly materials for packaging.
3.) The plastic waste reduction policy has spurred more and more customers to use eco-friendly materials for packaging.
4.) The plastic waste reduction policy has spurred more and more customers to use eco-friendly materials for packaging.

In response to the above trends, we already had our products qualified for digital printing by customers. We have also been adjusting our production to exploit the demand for environmentally friendly products, and enhancing our technology integration capabilities to satisfy the appetite for multi-featured security solutions. Making an inventory strategy to move sales quickly will be one of our focuses going forward.

In terms of global situation, there is a growing prospect for a strong recovery of world economy as vaccination gets popular across countries. However, the treacherous political- economic relations among countries that exert forms of sanction any time at will may impact our business operations unpredictably. At such a time, we must take advantage of our production establishments and sales channels across the globe to keep our business thriving. We plan to enhance the function of some overseas subsidiaries to turn them into regional headquarters and have them support each other to achieve the greatest benefits for the Group.

Finally, we would like to express our gratitude to our shareholders for your supports and our employees for their efforts. We will keep the great spirit of teamwork and continue to lead K Laser successfully in the future.

Sincerely,

Alex Kuo Chairman

Audit Report of Audit Committee

“Annex 2”

The Board of Directors prepared the Company's business report, financial

statements and earnings distribution plan for 2020, among which the financial statements were audited by Deloitte & Touche, and the audit report was issued.

The above-mentioned business report, financial statements and disposition of net profit have been checked by the Audit Committee, and it is found that there is no discrepancy. The report is as above according to Article 14-4 of the Securities Exchange Act and Article 219 of the Company Law, so please verify it.

K Laser Technology Inc.

Convenor of Audit Committee: Huang Bixing

March. 23, 2021

“Annex 3”

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Independent Auditors’ Report

Submitted to K Laser Technology Inc.

Opinion

We have audited the accompanying consolidated financial statements of K Laser Technology Inc. and its subsidiaries, which comprise the consolidated balance sheets as of December 31, 2020 and 2019, the consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and the notes to the consolidated financial statements (including a summary of significant accounting policies).

In our opinion, based on our audits and the report of other auditors (as referred to in the Other Matters section), the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of K Laser Technology Inc. and its subs idiaries as of December 31, 2020 and 2019 and their consolidated financial performance and consolidated cash flows for the years then ended in accordance with the 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 of the consolidated financial statements for the year ended December 31, 2020 in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and the auditing standards generally accepted in the Republic of China. We

conducted our audit of the consolidated financial statements for the year ended December 31, 2019 in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants, the approval letter with Ref. No. 1090360805 issued by the Financial Supervisory Commission of the Republic of China on February 25, 2020 and the auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit section of the auditors’ report. We are independent of K Laser Technology Inc. in accordance with the Norm of Professional Ethics for Certified Public Accountant of the Republic of China and have fulfilled our other responsibilities in accordance with the Norm. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of K Laser Technology Inc. and its subsidiaries for the year ended December 31, 2020. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Recognition of Sales Revenue

The sales revenue of K Laser Technology Inc. and its subsidiaries is mainly generated from the manufacture of laser films, anti-counterfeit labels, precision optical components and optical instruments, etc. The sales from the products sold during the year 2020 were significantly focused on one single customer. S ince the sales revenue and the verification thereof were significant to the consolidated financial statements, we therefore identified the sales revenue from the said customer as a key audit matter for the year. Refer to Note 4 to the consolidated financial statements for the details on accounting policies related to revenue recognition.

Our key audit procedures performed in respect of the aforementioned key audit matters included understanding of the internal control procedures relevant to sale transactions, and confirmation and assessment of the effectiveness of internal controls related to sale transactions. In addition, we also sampled the records of the transactions made with the major customers to review their external shipping

documents and export declaration forms and verify that the payment recipients were consistent with the entities to which products were sold. Other Matters

We did not audit the financial statements of some subsidiaries included in the consolidated financial statements of K Laser Technology Inc. and its subsidiaries, but such statements were instead audited by other auditors. Our opinion stated in the consolidated financial statements, insofar as it relates to the amounts included in the financial statements of some subsidiaries, is based solely on the report of other auditors. As of December 31, 2020 and 2019, the total assets of the aforementioned subsidiaries amounted to NT$439,989 thousand and NT$223,410 thousand, respectively, which accounted for 5.53% and 3.29% of the consolidated total assets, respectively. For the years ended December 31, 2020 and 2019, the net operating revenue of these subsidiaries were NT$285,507 thousand and NT$323,629 thousand, respectively, which accounted for 5.25% and 6.22% of the consolidated net operating revenue, respectively. The financial statements of some investee companies accounted for using the equity method were audited by other auditors. The amounts within the consolidated financial statements for those investee companies were based solely on the reports of other auditors. As of December 31, 2020 and 2019, investments of the aforementioned investee companies accounted for using the equity method were NT$123,089 thousand and NT$110,335 thousand, respectively, which accounted for 1.55% and 1.62% of the consolidated total assets, respectively. For the years ended December 31, 2020 and 2019, the amounts of investment gain recognized by the aforementioned investee companies and accounted for using the equity method were NT$13,315 thousand and NT$9,460 thousand, respectively, which accounted for 5.74% and (8.20)% of the consolidated net profit or loss before tax, respectively. Refer to Note 36 to the consolidated financial statements for relevant information of the above investee companies which we have not audited but were audited by other auditors.

We have also audited the financial statements of K Laser Technology Inc. as of and for the years ended December 31, 2020 and 2019 on which we have issued an unqualified opinion and the auditors’ report mentioned in the Other Matters section for reference.

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

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

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

Those charged with governance (including the audit committee) are responsible for overseeing the financial reporting process of K Laser Technology Inc. and its subsidiaries.

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

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

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

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit

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

Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal controls of K Laser Technology Inc. and its subsidiaries.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the ability of K Laser Technology Inc. and its subsidiaries to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause K Laser Technology Inc. and its subsidiaries to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements (including the disclosures) and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient and appropriate audit evidence regarding the financial information of the entities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit, and also responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit

findings (including any significant deficiencies in internal control that we identify during our audit).

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

From the matters communicated with those charged with governance, we determine that those matters of most significance in the audit of the consolidated financial statements for the year ended December 31, 2020 are the key audit matters. We describe these matters in our auditors’ report unless any law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Deloitte & Touche Huang Yi-Min, CPA

Hsu Wen-Ya, CPA

Financial Supervisory Commission Approval No.:

Jin-Guan-Zheng-Shen-Zi-1030024438

Securities and Futures Bureau Approval No.: Tai-Cai-Zheng-6-Zi-0920123784

March 23, 2021

K Laser Technology Inc. and its Subsidiaries

Consolidated Balance Sheet

December 31, 2020 and 2019

Code 1100 1110 1150 1170 1180 1200 1220 130X 1460 1470 11XX 1517 1550 1600 1755 1805 1821 1840 1990 15XX 1XXX Code 2100 2110 2150 2170 2180 2200 2220 2230 2280 2320 2399 21XX 2540 2580 2640 25XX 2XXX 3110 3200 3310 3320 3350 3410 3420 3500 31XX 36XX 3XXX	Assets Current assets Cash and cash equivalents (Notes 4 and 6) Financial assets at fair value through profit or loss - current (Notes 4 and 7) Notes receivable (Notes 4 and 8) Trade receivables (Notes 4 and 8) Trade receivables from related parties (Notes 4, 8 and 30) Other receivables (Note 30) Current tax assets (Notes 4 and 24) Inventories (Notes 4 and 9) Current assets held for sale (Notes 4 and 10) Other current assets (Notes 6 and 19) Total current assets Non-current assets Financial assets at fair value through other comprehensive income`－` non-current (Notes 4 and 11) Investments accounted for using the equity method (Notes 4 and 13) Property, plant and equipment (Notes 4 and 14) Right-of-use assets (Notes 4 and 15) Goodwill (Notes 4, 17 and 27) Other intangible assets (Notes 4 and 18) Deferred tax assets (Notes 4 and 24) Other non-current assets (Notes 6 and 19) Total non-current assets Total assets Liabilities and Equity Current liabilities Short-term borrowings (Note 20) Short-term notes and bills payable (Note 20) Notes payable Trade payables Trade payables to related parties (Note 30) Other payables Other payables to related parties (Note 30) Current tax liabilities (Notes 4 and 24) Lease liabilities`－`current (Notes 4 and 15) Current portion of long-term liabilities (Note 20) Other current liabilities Total current liabilities Non-current liabilities Long-term borrowings (Note 20) Lease liabilities`－`non-current (Notes 4 and 15) Net defined benefit liabilities`－`non-current (Notes 4 and 21) Total non-current liabilities Total liabilities Equity (Note 22) Share capital Ordinary shares Capital reserve Retained earnings Legal reserve Special reserve Unappropriated earnings Other equity Exchange differences on translation of foreign financial statements Unrealized gain on financial assets at fair value through other comprehensive income Treasury shares Total equity attributable to the Company Non-controlling interests Total equity Total liabilities and equity		Unit: In Thousands of New Taiwan Dollars December 31,2020 December 31,2019 Amount `％` Amount `％` $ 2,629,811 33 $ 1,588,179 23 27,150 - 201,777 3 35,457 1 105,839 2 855,955 11 910,058 13 670,406 8 473,652 7 58,048 1 36,358 1 7,552 - 11,512 - 993,440 13 914,826 14 28,154 - - - 188,677 2 162,723 2 5,494,650 69 4,404,924 65 118,244 2 102,466 1 591,940 7 600,010 9 1,131,375 14 1,189,677 18 263,580 3 249,659 4 85,752 1 85,752 1 44,672 1 48,465 1 21,094 - 27,887 - 208,183 3 77,624 1 2,464,840 31 2,381,540 35 $ 7,959,490 100 $ 6,786,464 100 $ 810,164 10 $ 801,147 12 299,917 4 169,943 2 257,027 3 158,715 2 507,491 7 442,698 7 43,535 1 48,468 1 415,897 5 367,623 5 1,753 - 12,054 - 13,559 - 22,463 - 51,244 1 38,882 1 100,000 1 10,000 - 24,509 - 70,297 1 2,525,096 32 2,142,290 31 1,250,000 16 1,180,000 18 199,582 2 195,155 3 18,888 - 25,498 - 1,468,470 18 1,400,653 21 3,993,566 50 3,542,943 52 1,593,246 20 1,593,246 23 585,347 7 551,531 8 213,042 3 213,042 3 200,987 2 201,090 3 384,752 5 255,807 4 (287,085) (4) (278,472) (4) ( 30,403 ) - ( 33,033 ) (1) (118,736) (1) (102,122) (1) 2,541,150 32 2,401,089 35 1,424,774 18 842,432 13 3,965,924 50 3,243,521 48 $ 7,959,490 100 $ 6,786,464 100
			Amount $ 2,629,811 27,150 35,457 855,955 670,406 58,048 7,552 993,440 28,154 188,677 5,494,650 118,244 591,940 1,131,375 263,580 85,752 44,672 21,094 208,183 2,464,840 $ 7,959,490 $ 810,164 299,917 257,027 507,491 43,535 415,897 1,753 13,559 51,244 100,000 24,509 2,525,096 1,250,000 199,582 18,888 1,468,470 3,993,566 1,593,246 585,347 213,042 200,987 384,752 (287,085) ( 30,403 ) (118,736) 2,541,150 1,424,774 3,965,924 $ 7,959,490

The accompanying notes are an integral part of the consolidated financial statements. (Please refer to the Deloitte & Touche auditors’ report dated March 23, 2021.)

Chairman: Kuo Wei-Wu

Manager: Kuo Wei-Wu

Accounting Manager: Hung Ya-Ching

15 -

K Laser Technology Inc. and its Subsidiaries Consolidated Statement of Comprehensive Income For the years ended December 31, 2020 and 2019

Unit: In Thousands of New Taiwan Dollars; Earnings (Loss) Per Share: In New Taiwan Dollars

C o d e 4000 Operating revenue (Notes 4 and 30) 5110 Cost of goods sold (Notes 9 and 30) 5950 Gross profit Operating expenses (Notes 8 and 30) 6100 Selling and marketing 6200 General and administrative 6300 Research and development 6450 Expected credit impairment loss 6000 Total operating expenses 6900 Profit from operations Non-operating income and expenses 7060 Share of profit or loss of associates accounted for using the equity method (Note 13) 7100 Interest income (Note 30) 7130 Dividend income 7190 Other income-others (Note 30) 7210 Gain (or loss) on disposal of property, plant and equipment 7230 Loss on foreign exchange 7235 Gain on financial assets (liabilities) at fair value through profit or loss 7510 Interest expense 7590 Miscellaneous expense 7625 Gain on disposal of investment 7670 Impairment loss 7000 Total non-operating income and expenses		2020	`％` 100 76 24 6 8 5 - 19 5 1 - - 1 - - - (1) (1) - - -		2019
		Amount $ 5,439,230 4,175,137 1,264,093 328,332 435,814 254,895 16,330 1,035,371 228,722 31,550 10,175 2,354 42,242 ( 2,212 ) ( 23,648 ) ( 31) ( 38,560 ) ( 32,425 ) 22,673 ( 8,739) 3,379			Amount $ 5,199,022 4,014,862 1,184,160 317,144 406,136 248,527 181,335 1,153,142 31,018 ( 103,825 ) 13,871 837 15,042 2,602 ( 11,795 ) 880 ( 40,634 ) ( 68,147 ) 49,298 ( 4,539) (146,410)	`％`
						100 77 23 6 8 5 3 22 1 ( 2) - - - - - - (1) (1) 1 - (3)

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Code 7900 Profit (loss) before tax 7950 Income tax expense (Notes 4 and 28) 8200 Profit (loss) for the year Other comprehensive income (loss) (Note 21) 8310 Items that will not be reclassified subsequently to profit or loss 8311 Remeasurement of defined benefit plans 8316 Unrealized loss on investments in equity instruments at fair value through other comprehensive income 8360 Items that may be reclassified subsequently to profit or loss 8361 Exchange differences on translation of foreign financial statements 8370 Share of other comprehensive loss of subsidiaries, associates and joint ventures accounted for using the equity method 8300 Total other comprehensive income (loss) 8500 Total comprehensive income (loss) for the year Net profit (loss) attributed to 8610 Owners of the company 8620 Non-controlling interests 8600 Total comprehensive income (loss) attributed to 8710 Owners of the company 8720 Non-controlling interests 8700 Earnings (loss) per share (Note 25) From continuing operations 9710 Basic 9810 Diluted		2020	`％` 5 (1) 4 - - - - - 4 3 1 4 3 1 4	2019
		Amount $ 232,101 (40,962) 191,139 236 12,617 ( 9,186 ) ( 1,872) 1,795 $ 192,934 $ 144,409 46,730 $ 191,139 $ 137,403 55,531 $ 192,934 $ 0.96 $ 0.95		Amount ($115,392) (43,317) (158,709) ( 4,228 ) ( 24,763 ) ( 88,238 ) ( 768) (117,997) ($276,706) ($119,835) (38,874) ($158,709) ($234,732) ( 41,974) ($276,706) ($ 0.79)	`％`
					(2) (1) (3) - - (2) - (2) (5) (2) (1) (3) (4) (1) (5)

The accompanying notes are an integral part of the consolidated financial statements. (Please refer to the Deloitte & Touche auditors’ report dated March 23, 2021.)

Chairman: Kuo Wei-Wu Manager: Kuo Wei-Wu Accounting Manager: Hung Ya-Ching

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K Laser Technology Inc. and its Subsidiaries Consolidated Statement of Changes in Equity For the years ended December 31, 2020 and 2019

Unit: In Thousands of New Taiwan Dollars

Equity Attributable to Shareholders of the Parent Company

	Retained earnings	Other equity Exchange differences on translation of financial statements of foreign operations Unrealized loss (gain) on financial assets at fair value through other comprehensive income ($ 195,571 ) ($ 5,574 ) - - - - - - - - ( 82,979 ) ( 27,690 ) - - - - - - 78 231 - - - - ( 278,472 ) ( 33,033 ) - - - - - - ( 8,874 ) 1,632 - - - - - - 261 998 - - - - - - ($287,085) ( $30,403)	Other equity Exchange differences on translation of financial statements of foreign operations Unrealized loss (gain) on financial assets at fair value through other comprehensive income ($ 195,571 ) ($ 5,574 ) - - - - - - - - ( 82,979 ) ( 27,690 ) - - - - - - 78 231 - - - - ( 278,472 ) ( 33,033 ) - - - - - - ( 8,874 ) 1,632 - - - - - - 261 998 - - - - - - ($287,085) ( $30,403)	Other equity Exchange differences on translation of financial statements of foreign operations Unrealized loss (gain) on financial assets at fair value through other comprehensive income ($ 195,571 ) ($ 5,574 ) - - - - - - - - ( 82,979 ) ( 27,690 ) - - - - - - 78 231 - - - - ( 278,472 ) ( 33,033 ) - - - - - - ( 8,874 ) 1,632 - - - - - - 261 998 - - - - - - ($287,085) ( $30,403)	Total equity
		Exchange differences on translation of financial statements of foreign operations ($ 195,571 ) - - - - ( 82,979 ) - - - 78 - - ( 278,472 ) - - - ( 8,874 ) - - - 261 - - - ($287,085)
Legal reserve $ 206,459 6,583 - - - - - - - - - - 213,042 - - - - - - - - - - - $ 213,042	Special reserve $ 162,918 - 38,226 - - - - - - ( 54 ) - - 201,090 - - - - - - - ( 103 ) - - - $ 200,987
			($ (	($ (	$ 3,388,220 - - ( 62,043 ) ( 158,709 ) ( 117,997 ) ( 17,422 ) ( 51,288 ) 52,263 289 ( 1,297 ) 211,505 3,243,521 - - 191,139 1,795 ( 77,812 ) 44,270 49,237 75,866 3,691 ( 4,500 ) 438,717 $ 3,965,924
			( (	(
			(	(

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

(Please refer to the Deloitte & Touche auditors’ report dated March 23, 2021.)

Chairman: Kuo Wei-Wu

Manager: Kuo Wei-Wu

Accounting Manager: Hung Ya -Ching

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K Laser Technology Inc. and its Subsidiaries Consolidated Statement of Cash Flows

For the years ended December 31, 2020 and 2019

Unit: In Thousands of New Taiwan Dollars

Code Cash flows from operating activities A10000 Profit (loss) before tax A20010 Income and expense adjustments A20100 Depreciation expense A20200 Amortization expense A20300 Expected credit impairment loss A20400 Net (gain) on financial assets at fair value through profit or loss A20900 Interest expense A21200 Interest income A21300 Dividend income A21900 Share-based compensation expense A22300 Share of (profit) loss of associates and joint ventures accounted for using the equity method A22500 Loss (gain) on disposal and write-down of property, plant and equipment A23100 Gain on disposal of investment A23700 Impairment loss recognized on non-financial asset A23800 Loss on inventory valuation and obsolescence A29900 Gain on lease modification A30000 Net change in operating assets and liabilities A31130 Notes receivable A31150 Trade receivables A31160 Trade receivables from related parties A31180 Other receivables A31200 Inventories A31240 Other current assets A31990 Other non-current assets A32130 Notes payable A32150 Trade payables A32160 Trade payables to related parties A32180 Other payables A32230 Other current liabilities A32240 Net defined benefit liabilities`－`non-current	2020 $ 232,101 231,574 5,028 16,330 31 38,560 ( 10,175 ) ( 2,354 ) 9,301 ( 31,550 ) 2,212 ( 22,673 ) 8,739 126 ( 246 ) 70,382 31,956 ( 201,462 ) ( 27,680 ) ( 78,740 ) ( 28,796 ) ( 7,383 ) 98,312 64,793 ( 4,933 ) 34,137 3,449 ( 6,374)	2019
		($ 115,392 ) 230,257 3,903 181,335 ( 880) 40,634 ( 13,871 ) ( 837 ) 23,002 103,825 ( 2,602 ) ( 49,298 ) 4,539 27,886 ( 5 ) ( 65,450 ) 239,889 ( 100,796 ) 19,313 50,017 50,890 ( 3,635 ) ( 70,047 ) ( 39,864 ) 3,725 38,860 ( 13,061 ) ( 1,092)

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Code A33000 Cash generated from operations A33100 Interest received A33300 Interest paid A33500 Income tax paid AAAA Net cash generated from operating activities Cash flows from investing activities B00010 Acquisition of financial assets at fair value through other comprehensive income B00100 Acquisition of financial assets recognized initially at fair value through profit or loss B00200 Disposal of financial assets recognized initially at fair value through profit or loss B01800 Acquisition of long-term equity investment accounted for using the equity method B01900 Proceeds from disposal of long-term equity investment accounted for using the equity method B02000 Increase in prepayments for investment B02700 Purchase of property, plant and equipment B02800 Proceeds from disposal of property, plant and equipment B03700 Decrease (increase) in refundable deposits B04100 Decrease in other receivables B04500 Purchase of intangible assets B05000 Cash inflow due to merger B06600 Decrease (increase) in other financial assets B07600 Dividends received BBBB Net cash used in investing activities Cash flows from financing activities C00200 Increase (decrease) in short-term borrowings C00500 Increase in short-term notes and bills payable C01600 Long-term borrowings C01700 Repayments of Long-term borrowings C04500 Dividends paid to owners of the Company C04900 Payments for buy-back of treasury shares C05000 Disposal of treasury shares C05100 Purchase of treasury shares by employees C05400 Acquisition of interests in subsidiaries C05500 Proceeds from sale of investments in subsidiaries	2020 $ 424,665 10,175 ( 38,435) (39,114) 357,291 ( 3,000) ( 584,470) 764,621 ( 9,005) 19,762 - ( 137,993) 5,415 7,888 6,458 ( 1,235) - ( 128,028) 7,045 (52,542) 9,017 130,000 250,000 ( 90,000) - ( 77,812) 45,507 - ( 13,235) 44,925	2019
		$ 541,245 13,871 ( 40,859) (43,945) 470,312 - ( 878,342) 759,139 ( 76,906) 8,375 ( 21,375) ( 120,937) 69,143 ( 8,644) 8,944 ( 1,077) 142,360 631 5,042 (113,647) ( 120,006) 70,000 920,000 ( 770,000) ( 62,043) ( 17,422) - 81,141 ( 9,084) 10,455

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Code C05800 Changes in non-controlling interests C04020 Repayment of the principal portion of lease liabilities CCCC Net cash generated from financing activities DDDDEffects of exchange rate changes on the balance of cash and cash equivalents EEEEIncrease in cash and cash equivalents for the year E00100Cash and cash equivalents at the beginning of the year E00200Cash and cash equivalents at the end of the year
		$

The accompanying notes are an integral part of the consolidated financial statements. (Please refer to the Deloitte & Touche auditors’ report dated March 23, 2021.)

Chairman:Kuo Wei-Wu Manager: Kuo Wei-Wu Accounting Manager: Hung Ya-Ching

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“Annex 4”

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Independent Auditors’ Report

K Laser Technology Inc.

Opinion

We have audited the accompanying financial statements of K Laser Technology Inc., which comprise the balance sheets as of December 31, 2020 and 2019, the statements of comprehensive income, changes in equity and cash flows for the years then ended, and the notes to the financial statements (including a summary of significant accounting policies).

In our opinion, based on our audits and the report of other auditors (as referred to in the Other Matters section), the accompanying financial statements present fairly, in all material respects, the financial position of K Laser Technology Inc. as of December 31, 2020 and 2019 and its financial performance and cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

We conducted our audit of the financial statements for the year ended December 31, 2020 in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and the auditing standards generally accepted in the Republic of China. We conducted our audit of the financial statements for the year ended December 31 , 2019 in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants, the approval letter with Ref. No. 1090360805 issued by the Financial Supervisory Commission of the Republic of China on February 25, 2020 and the auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit section of the auditors’ report. We are independent of K Laser Technology Inc. in accordance with the Norm of Professional Ethics for Certified Public Accountant of the Republic of China and have fulfilled our other responsibilities in accordance with the Norm.

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We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of K Laser Technology Inc. for the year ended December 31, 2020. 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.

Recognition of Sales Revenue

The sales revenue of K Laser Technology Inc. is mainly generated from the manufacture of laser films, anti-counterfeit labels, laser paper, etc., which has been affected by increasingly saturated market and competition within the industry. In addition to developing new products in recent years, acquiring new customers is also a key operational strategy. To meet the demand for sales to customers in this year, inventories are stored in overseas shipping warehouse whereby warehouse custodian is responsible for the checking, acceptance and storage of inventories, as well as sending out shipment information to K Laser Technology Inc. for verification. K Laser Technology Inc. recognized sales revenue based on the shipment information provided by warehouse cust odian. Therefore, the validity of sales revenue transactions recognized from overseas shipping warehouse and timing of recognition were identified as key audit matters for the year ended December 31, 2020. Refer to Note 4 to the financial statements for the details on accounting policies related to revenue recognition. Our key audit procedure performed in respect of the aforementioned key audit matters comprised the following:

We understood the internal control procedures for the recognition of sales revenue from overseas shipping warehouse, tested and assessed the effectiveness of related internal controls.
We performed substantive tests of sales revenue transactions from overseas shipping warehouse.
We confirmed the ending inventories of overseas shipping warehouse by letter.

Other Matters

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The financial statements of some investee companies accounted for using the equity method for the years dated December 31, 2020 and 2019 were audited by other auditors. Thus in our opinion expressed in the aforementioned financial report, the amounts within the financial statements for those investee companies were based solely on the reports of other auditors. As of December 31, 2020 and 2019, the aforementioned investments accounted for using the equity met hod were NT$436,955 thousand and NT$252,995 thousand, respectively, which accounted for 8.88% and 5.77% of the total assets, respectively. For the years ended December 31, 2020 and 2019, the amounts of investment gain recognized by the aforementioned investee companies and accounted for using the equity method were NT$42,475 thousand and NT$14,863 thousand, respectively, which accounted for (28.24)% and (12.62)% of the profit (loss) before tax, respectively. Refer to Note 35 to the financial statements for relevant information on the above investee companies which we have not audited but were audited by other auditors.

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

Management is responsible for the preparation and fair presentation of the financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and for such internal control as management determines is necessary to enable the preparation of 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 ability of K Laser Technology Inc. to continue as a going concern, disclosing, as applicable, matters related to the going concern and using the going concern basis of accounting unless management either intends to liquidate K Laser Technology Inc. or to cease operations, or has no realistic alternative but to do so.

Those charged with governance (including the audit committee) are responsible for overseeing the financial reporting process of K Laser Technology Inc.

Auditors’ Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due

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

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal controls of K Laser Technology Inc.
3.Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made b y management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the ability of K Laser Technology Inc. to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause K Laser Technology Inc. to cease to continue as a going concern.
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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.
Obtain sufficient and appropriate audit evidence regarding the financial information of the segments within K Laser Technology Inc. to express an opinion on the financial statements. We are responsible for the direction, supervision and performance of the corporate audit, and als o 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 th at we identify during our audit).

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

From the matters communicated with those charged with governance, we determine that those matters of most significance in the audit of the financial statements for the year ended December 31, 2020 are the key audit matters. We describe these matters in our auditors’ report unless any law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. Deloitte & Touche

Huang Yi-Min, CPA

Hsu Wen-Ya, CPA

Financial Supervisory Commission Approval No.: Jin-Guan-Zheng-Shen-Zi1030024438 March 23, 2021

Securities and Futures Bureau Approval No.: Tai-Cai-Zheng-6-Zi-0920123784

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K Laser Technology Inc.

Balance Sheet

December 31, 2020 and 2019

Code 1100 1110 1150 1170 1180 1200 1220 130X 1460 1470 11XX 1517 1550 1600 1755 1760 1780 1840 1990 15XX 1XXX Code 2100 2110 2170 2180 2200 2280 2320 2399 21XX 2540 2635 2640 2650 2670 25XX 2XXX 3110 3200 3310 3320 3350 3410 3420 3500 3XXX	Assets Current assets Cash and cash equivalents (Notes 4 and 6) Financial assets at fair value through profit or loss`－`current (Notes 4 and 7) Notes receivable (Notes 4 and 8) Trade receivables (Notes 4 and 8) Trade receivables from related parties (Notes 4, 8 and 28) Other receivables (Note 28) Current tax assets (Notes 4 and 23) Inventories (Notes 4 and 9) Current assets held for sale (Notes 4 and 10) Other current assets (Note 17) Total current assets Non-current assets Financial assets at fair value through other comprehensive income`－`non-current (Notes 4 and 11) Investments accounted for using the equity method (Notes 4 and 12) Property, plant and equipment (Notes 4, 13 and 28) Right-of-use assets (Notes 4 and 14) Net investment property (Notes 4 and 15) Other intangible assets (Notes 4 and 16) Deferred tax assets (Notes 4 and 23) Other non-current assets (Notes 6 and 17) Total non-current assets Total assets Liabilities and Equity Current liabilities Short-term borrowings (Note 18) Short-term notes and bills payable (Note 18) Trade payables Trade payables to related parties (Note 28) Other payables (Notes 19 and 28) Lease liabilities`－`current (Notes 4 and 14) Current portion of long-term liabilities (Note 18) Other current liabilities Total current liabilities Non-current liabilities Long-term borrowings (Note 18) Lease liabilities`－`non-current (Notes 4 and 14) Net defined benefit liabilities (Notes 4 and 20) Credit balance for investments accounted for using the equity method (Notes 4 and 12) Other liabilities`－`others Total non-current liabilities Total liabilities Equity (Note 21) Share capital Ordinary shares Capital reserve Retained earnings Legal reserve Special reserve Unappropriated earnings Other equity Exchange differences on translation of foreign financial statements Unrealized gain on financial assets at fair value through other comprehensive income Treasury shares Total equity Total liabilities and equity		Unit: December 31,2020	Unit: December 31,2020	In Thousands of New Taiwan Dollars December 31,2019 `％` Amount `％` 7 $ 283,611 6 - 5,296 - - 3,233 - 1 26,184 1 2 82,343 2 - 13,444 - - 137 - 2 36,711 1 - - - 1 4,647 - 13 455,606 10 1 36,681 1 77 3,559,130 81 3 159,873 4 2 79,680 2 1 49,908 1 - 3,009 - - 17,800 - 3 22,440 1 87 3,928,521 90 100 $ 4,384,127 100 9 $ 234,000 5 6 149,966 4 1 21,049 1 1 59,549 1 2 52,905 1 - 6,227 - 2 - - - 53,003 1 21 576,699 13 26 1,120,000 25 1 73,993 2 - 25,498 1 - 185,906 4 - 942 - 27 1,406,339 32 48 1,983,038 45 32 1,593,246 36 12 551,531 13 4 213,042 5 4 201,090 4 8 255,807 6 6 ) ( 278,472 ) ( 6 ) - ( 33,033 ) ( 1 ) 2) ( 102,122) ( 2) 52 2,401,089 55 100 $ 4,384,127 100	In Thousands of New Taiwan Dollars December 31,2019 `％` Amount `％` 7 $ 283,611 6 - 5,296 - - 3,233 - 1 26,184 1 2 82,343 2 - 13,444 - - 137 - 2 36,711 1 - - - 1 4,647 - 13 455,606 10 1 36,681 1 77 3,559,130 81 3 159,873 4 2 79,680 2 1 49,908 1 - 3,009 - - 17,800 - 3 22,440 1 87 3,928,521 90 100 $ 4,384,127 100 9 $ 234,000 5 6 149,966 4 1 21,049 1 1 59,549 1 2 52,905 1 - 6,227 - 2 - - - 53,003 1 21 576,699 13 26 1,120,000 25 1 73,993 2 - 25,498 1 - 185,906 4 - 942 - 27 1,406,339 32 48 1,983,038 45 32 1,593,246 36 12 551,531 13 4 213,042 5 4 201,090 4 8 255,807 6 6 ) ( 278,472 ) ( 6 ) - ( 33,033 ) ( 1 ) 2) ( 102,122) ( 2) 52 2,401,089 55 100 $ 4,384,127 100	In Thousands of New Taiwan Dollars December 31,2019 `％` Amount `％` 7 $ 283,611 6 - 5,296 - - 3,233 - 1 26,184 1 2 82,343 2 - 13,444 - - 137 - 2 36,711 1 - - - 1 4,647 - 13 455,606 10 1 36,681 1 77 3,559,130 81 3 159,873 4 2 79,680 2 1 49,908 1 - 3,009 - - 17,800 - 3 22,440 1 87 3,928,521 90 100 $ 4,384,127 100 9 $ 234,000 5 6 149,966 4 1 21,049 1 1 59,549 1 2 52,905 1 - 6,227 - 2 - - - 53,003 1 21 576,699 13 26 1,120,000 25 1 73,993 2 - 25,498 1 - 185,906 4 - 942 - 27 1,406,339 32 48 1,983,038 45 32 1,593,246 36 12 551,531 13 4 213,042 5 4 201,090 4 8 255,807 6 6 ) ( 278,472 ) ( 6 ) - ( 33,033 ) ( 1 ) 2) ( 102,122) ( 2) 52 2,401,089 55 100 $ 4,384,127 100	In Thousands of New Taiwan Dollars December 31,2019 `％` Amount `％` 7 $ 283,611 6 - 5,296 - - 3,233 - 1 26,184 1 2 82,343 2 - 13,444 - - 137 - 2 36,711 1 - - - 1 4,647 - 13 455,606 10 1 36,681 1 77 3,559,130 81 3 159,873 4 2 79,680 2 1 49,908 1 - 3,009 - - 17,800 - 3 22,440 1 87 3,928,521 90 100 $ 4,384,127 100 9 $ 234,000 5 6 149,966 4 1 21,049 1 1 59,549 1 2 52,905 1 - 6,227 - 2 - - - 53,003 1 21 576,699 13 26 1,120,000 25 1 73,993 2 - 25,498 1 - 185,906 4 - 942 - 27 1,406,339 32 48 1,983,038 45 32 1,593,246 36 12 551,531 13 4 213,042 5 4 201,090 4 8 255,807 6 6 ) ( 278,472 ) ( 6 ) - ( 33,033 ) ( 1 ) 2) ( 102,122) ( 2) 52 2,401,089 55 100 $ 4,384,127 100	In Thousands of New Taiwan Dollars December 31,2019 `％` Amount `％` 7 $ 283,611 6 - 5,296 - - 3,233 - 1 26,184 1 2 82,343 2 - 13,444 - - 137 - 2 36,711 1 - - - 1 4,647 - 13 455,606 10 1 36,681 1 77 3,559,130 81 3 159,873 4 2 79,680 2 1 49,908 1 - 3,009 - - 17,800 - 3 22,440 1 87 3,928,521 90 100 $ 4,384,127 100 9 $ 234,000 5 6 149,966 4 1 21,049 1 1 59,549 1 2 52,905 1 - 6,227 - 2 - - - 53,003 1 21 576,699 13 26 1,120,000 25 1 73,993 2 - 25,498 1 - 185,906 4 - 942 - 27 1,406,339 32 48 1,983,038 45 32 1,593,246 36 12 551,531 13 4 213,042 5 4 201,090 4 8 255,807 6 6 ) ( 278,472 ) ( 6 ) - ( 33,033 ) ( 1 ) 2) ( 102,122) ( 2) 52 2,401,089 55 100 $ 4,384,127 100
			Amount $ 360,226 5,265 5,323 37,451 108,218 9,991 208 83,398 15,100 16,781 641,961 34,984 3,807,614 159,057 73,629 37,869 2,393 11,800 151,243 4,278,589 $ 4,920,550 $ 430,000 299,917 36,164 75,293 83,268 6,023 100,000 10,307 1,040,972 1,250,000 68,598 18,888 - 942 1,338,428 2,379,400 1,593,246 585,347 213,042 200,987 384,752 287,085 ) 30,403 ) 118,736) 2,541,150 $ 4,920,550				Amount $ 283,611 5,296 3,233 26,184 82,343 13,444 137 36,711 - 4,647 455,606 36,681 3,559,130 159,873 79,680 49,908 3,009 17,800 22,440 3,928,521 $ 4,384,127 $ 234,000 149,966 21,049 59,549 52,905 6,227 - 53,003 576,699 1,120,000 73,993 25,498 185,906 942 1,406,339 1,983,038 1,593,246 551,531 213,042 201,090 255,807 278,472 ) 33,033 ) 102,122) 2,401,089 $ 4,384,127		`％`
		( ( (		( (		( ( (		( ( (	6 - - 1 2 - - 1 - - 10 1 81 4 2 1 - - 1 90 100 5 4 1 1 1 - - 1 13 25 2 1 4 - 32 45 36 13 5 4 6 6 ) 1 ) 2) 55 100

The accompanying notes are an integral part of the financial statements. (Please refer to the Deloitte & Touche auditors’ report dated March 23, 2021.)

Chairman: Kuo Wei-Wu

Manager: Kuo Wei-Wu Accounting Manager: Hung Ya-Ching

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K Laser Technology Inc. Statement of Comprehensive Income For the years ended December 31, 2020 and 2019

Unit: In Thousands of New Taiwan Dollars; Earnings (Loss) Per Share: In New Taiwan Dollar

Code 4100 Operating revenue (Notes 4 and 28) 5110 Cost of goods sold (Notes 9 and 28) 5900 Gross profit 5910 Unrealized sales profit 5920 Unrealized sales profit 5950 Gross profit Operating expenses (Note 28) 6100 Selling and marketing 6200 General and administrative 6300 Research and development 6450 Expected credit impairment (gain on reversal) loss 6000 Total operating expenses 6900 Loss from operations Non-operating income and expenses 7060 Share of profit or loss of subsidiaries and associates accounted for using the equity method (Note 12) 7100 Interest income (Note 28) 7190 Other income-others (Note 28) 7210 Loss on disposal of property, plant and equipment		2020

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C o d e 7230 Loss on foreign exchange 7235 Gain on financial assets (liabilities) at fair value through profit or loss 7510 Interest expense 7590 Miscellaneous expense 7625 Gain on disposal of investment 7670 Impairment loss 7000 Total non-operating income and expenses 7900 Profit (loss) before tax 7950 Income tax expense (Notes 4 and 23) 8200 Profit (loss) for the year Other comprehensive income (loss) (Notes 20 and 21) 8310 Items that will not be reclassified subsequently to profit or loss 8311 Actuarial gain (loss) on defined benefit plan 8316 Unrealized gain (loss) on investments in equity instruments at fair value through othecomprehensive income 8360 Items that may be reclassified subsequently to profit or loss 8361 Exchange differences on translation of foreign financial statements 8300 Total other comprehensive income (loss) 8500 Total comprehensive income (loss) for the year	2020	％ ( 1 ) - ( 3 ) ( 1 ) - - 26 19 ( 1) 18 - - ( 1) ( 1) 17	2019
	Amount ( $ 10,641 ) ( 31 ) ( 25,562 ) ( 7,590 ) 2,489 - 207,537 150,409 ( 6,000) 144,409 236 1,632 ( 8,874) ( 7,006) $ 137,403		Amount ( $ 3,646 ) 301 ( 21,406 ) ( 11,306 ) 45,383 ( 4,539) ( 44,661) ( 117,789 ) ( 2,046) (119,835) ( 4,228 ) ( 27,690 ) ( 82,979) (114,897) ($ 234,732)	％
				- - ( 3 ) ( 2 ) 7 ( 1) ( 7) ( 18 ) - (18) ( 1 ) ( 4 ) (13) (18) (36)

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Code Earnings (loss) per share (Note 24) From continuing operations 9710 Basic 9810 Diluted		2020	％		2019
		Amount $ 0.96 $ 0.95			Amount $ 0.79)	％
				(

The accompanying notes are an integral part of the financial statements. (Please refer to the Deloitte & Touche auditors’ report dated March 23, 2021.)

Chairman: Kuo Wei-Wu Manager: Kuo Wei-Wu Accounting Manager: Hung Ya-Ching

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K Laser Technology Inc. Statement of Changes in Equity For the years ended December 31, 2020 and 2019

Capital reserve $ 529,962 - - - - - - - 21,060 211 298 551,531 - - - ( 3,668 ) 22,969 3,691 - 10,824 $ 585,347		Retained earnings	Unappropriated earnings $ 488,494 ( 6,583 ) ( 38,226 ) ( 62,043 ) ( 119,835 ) ( 4,228 ) - - - ( 177 ) ( 1,595) 255,807 144,409 236 - - ( 11,200 ) - ( 4,500 ) - $ 384,752	Unit: In Other equity Exchange differences on translation of financial statements of foreign operations Unrealized loss (gain) on financial assets at fair value through other comprehensive income ( $ 195,571 ) ( $ 5,574 ) - - - - - - - - ( 82,979 ) ( 27,690 ) - - - - - - 78 231 - - ( 278,472 ) ( 33,033 ) - - ( 8,874 ) 1,632 - - - - 261 998 - - - - - - ($ 287,085) ($ 30,403)	Unit: In Other equity Exchange differences on translation of financial statements of foreign operations Unrealized loss (gain) on financial assets at fair value through other comprehensive income ( $ 195,571 ) ( $ 5,574 ) - - - - - - - - ( 82,979 ) ( 27,690 ) - - - - - - 78 231 - - ( 278,472 ) ( 33,033 ) - - ( 8,874 ) 1,632 - - - - 261 998 - - - - - - ($ 287,085) ($ 30,403)	Thousands of New Taiwan Dollars Transactions of Treasuryshares Total equity ( $ 93,118 ) $ 2,686,816 - - - - - ( 62,043 ) - ( 119,835 ) - ( 114,897 ) ( 17,422 ) ( 17,422 ) ( 22,785 ) ( 22,785 ) 31,203 52,263 - 289 - ( 1,297) ( 102,122 ) 2,401,089 - 144,409 - ( 7,006 ) ( 77,812 ) ( 77,812 ) 22,785 19,117 - 12,925 - 3,691 - ( 4,500 ) 38,413 49,237 ($ 118,736) $ 2,541,150
				Exchange differences on translation of financial statements of foreign operations ( $ 195,571 ) - - - - ( 82,979 ) - - - 78 - ( 278,472 ) - ( 8,874 ) - - 261 - - - ($ 287,085)
	Legal reserve $ 206,459 6,583 - - - - - - - - - 213,042 - - - - - - - - $ 213,042	Special reserve $ 162,918 - 38,226 - - - - - - ( 54 ) - 201,090 - - - - ( 103 ) - - - $ 200,987
(		( (	( ( ( ( ( ( ( ( (	( ( ( ( (	( ( ( (	( ( ( ( ( (

The accompanying notes are an integral part of the financial statements.

(Please refer to the Deloitte & Touche auditors ’ report dated March 23, 2021.)

Chairman: Kuo Wei-Wu

Manager: Kuo Wei-Wu

Accounting Manager: Hung Ya-Ching

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K Laser Technology Inc.

Statement of Cash Flows

For the years ended December 31, 2020 and 2019

Unit: In Thousands of New Taiwan Dollars

Code Cash flows from operating activities A10000 Profit (loss) before tax A20010 Incomes, expenses and losses not influencing cash flows A20100 Depreciation expense A20200 Amortization expense A20300 Expected credit (reversal) loss A20400 Net (gain) on financial assets at fair value through profit or loss A20900 Interest expense A21200 Interest income A21900 Share-based compensation expense A22300 Share of (profit) loss of subsidiaries and associates accounted for using the equity method A22500 Loss on disposal and write-down of property, plant and equipment A23100 Gain on disposal of investment A23700 Impairment loss recognized on financial assets A23800 Gain on inventory valuation and reversal A23900 Unrealized sales profit (loss) among associates A24000 Realized sales profit (loss) among associates A30000 Net change in operating assets and liabilities A31130 Notes receivable A31150 Trade receivables A31160 Trade receivables from related parties	2020 $ 150,409 33,113 764 ( 694 ) 31 25,562 ( 1,291 ) - ( 202,008 ) 19 ( 2,489 ) - ( 561 ) 13,202 ( 4,898 ) ( 2,032 ) 29,152 ( 25,181 )	2019
		( $ 117,789 ) 34,107 742 - ( 301 ) 21,406 ( 2,618 ) 20,359 105,154 157 ( 45,383 ) 4,539 ( 3,748 ) 13,622 ( 13,202 ) ( 433 ) 5,336 6,244

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A31180	Other receivables		3,452	(	4,019 )
A31200	Inventories		16,500		816
A31240	Other current assets	(	10,970 )		620
A31990	Other non-current assets		1,172	(	1,554 )
A32130	Notes payable	(	612 )		-
A32150	Trade payables	(	16,177 )	(	3,745 )
A32160	Trade payables to related parties		15,744		15,375
A32180	Other payables	(	6,457 )		2,467
A32230	Other current assets		5,897		2,078
A32240	Net defined benefit liabilities－
	current	(	6,374)	(	1,092)
A33000	Cash generated from operations		15,273		39,138
A33100	Interest received		1,291		2,618
A33300	Interest paid	(	24,844 )	(	19,886 )
A33500	Income tax paid	(	71)	(	5,563)
AAAA	Net cash generated from (used in)
	operating activities	(	8,351)		16,307

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Code Cash flows from investing activities B00010 Acquisition of financial assets at fair value through other comprehensive income B00100 Acquisition of financial assets recognized initially at fair value through profit or loss B01800 Acquisition of long-term equity investment accounted for using the B01900 Proceeds from disposal of long-term equity investment accounted for using the equity method B00200 Disposal of financial assets recognized initially at fair value through profit or loss B02200 Cash outflows from acquisition of subsidiaries B02300 Cash inflows from disposal of subsidiaries B02400 Refunds of share payment due to decrease in capital of investee companies accounted for using the equity method B02600 Proceeds from disposal of assets held for sale B02700 Purchase of property, plant and equipment B02800 Proceeds from disposal of property, plant and equipment B03700 Decrease (increase) in refundable deposits B04500 Purchase of intangible assets B05000 Cash and cash equivalents obtained the dissolved company due to business combination B06600 Increase in other financial assets	2020 ( $ 3,000 ) ( 3,015 ) ( 5,200 ) - 3,309 ( 246,557 ) 44,925 - 2,513 ( 10,505 ) 70 3,272 ( 149 ) 36,464 ( 128,445 )	2019
		$ - - ( 174,924 ) 18,830 - - - 138,054 - ( 8,620 ) 13,479 ( 463 ) - - -

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B07600	Dividends received from subsidiaries
	and associates		263,622		81,935
BBBB	Net cash generated from (used in)
	investing activities	(	42,696)		68,291
	Cash flows from financing activities
C00200	Decrease in Short-term borrowings	(	48,234 )	(	61,000 )
C00600	Increase in short-term notes and bills
	payable		100,018		50,000
C01600	Long-term borrowings		250,000		870,000
C01700	Repayments of Long-term borrowings	(	90,000 )	(	770,000 )
C04200	Repayment of principal portion of
	lease liabilities	(	6,310 )	(	6,189 )
C04500	Dividends paid		-	(	62,043 )
C04900	Payments for buy-back of treasury
	shares	(	77,812 )	(	17,422 )
C05100	Purchase of treasury shares by
	employees		-		81,141
CCCC	Net cash generated from
	financing activities		127,662		84,487
EEEE	Increase in cash and cash equivalents for
	the year		76,615		169,085
E00100	Cash and cash equivalents at the
	beginning of the year		283,611		114,526
E00200	Cash and cash equivalents at the end of
	the year		$ 360,226		$ 283,611

The accompanying notes are an integral part of the financial statements. (Please refer to the Deloitte & Touche auditors ’ report dated March 23, 2021.)

Chairman: Kuo Wei-Wu Manager: Kuo Wei-Wu Accounting Manager: Hung Ya-Ching

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“Annex 5”

K Laser Technology Inc. Disposition of Net Profit

2020

Item Undistributed profits at the beginning of period Profit after tax in 2020 Investment adjustment retained earnings using equity method Retain profits due to long-term equity investment adjustment Comprehensive income in 2020 Undistributed profits after adjustment List 10% of legal profit reserves according to law List special profit reserves according to law Distributable Profit Distribution Item Shareholders’ Bonus - Cash (Each share distribute NT$ 0.96) (Notes) Undistributed profits at the end of period	Unit: NT$ Amount	Unit: NT$ Amount
		255,806,804 144,408,982 (4,500,010) (11,200,343) 236,049
		384,751,482 (12,894,468) (116,500,976)
		255,356,038 (144,220,446)
		111,135,592

Note 1: Shareholders' bonus is based on 150,229,631 outstanding shares in March 2021.

If the Company subsequently repurchase the Company's shares or transfers, converts and cancels the treasury shares, the corporate bond creditors execute the conversion rights and the employees execute the share subscription rights according to the share subscription method of the share option certificate, etc., resulting in the change of the outstanding shares and the need to adjust the dividend rate, the Chairman shall be authorized to take full measures.

Note 2: Authorize the chairman to handle the ex-dividend base date.

Chairman: Kuo Wei-Wu Manager: Kuo Wei-Wu Accounting Supervisor: Hung Ya-Ching

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“Annex 6”

K Laser Technology Inc.

Provision Comparison Table Before/After Revision of Corporation Bylaws

	Provision After Revision	Original Provision	Revision Description
	Article 2: The businesses operated by the Company are as follows: CC01080Electronic Parts and Components Manufacturing CC01100Restrained Telecom Radio Frequency Equipments and Materials Manufacturing CE01030Photographic and Optical Equipment Manufacturing G903010 Telecommunications Enterprises I301010Software Design Services CA04010 Surface Treatments F401010 International Trade 1. Research, Development, Design, Producing, Manufacturing and Sales: (1) Hologram (2)LaserCD and OpticalDisk. (3) Photomagnetic Disk. (4) EmbossingMachine. (5) ElectroformingSystem, EquipmentandMaterial. (6) EmbossingMaterial (7) Electro-Optics ApparatusandInstrument. (8) PrecisionOpticalElementand Component (9) Optical Coating. (10) Smart Card, SecurityCardand Related Equipment. (11) LCOS Projection Engine (12) Projector, Smart Projector and Optical touch module (13) Digital wireless public address system 2. Import and export trade of the above-mentioned related products.	Article 2: The businesses operated by the Company are as follows: 1. Research, Development, Design, Producing, Manufacturing and Sales: (1) HOLOGRAM. (2) LASER CD and OPTICAL DISK. (3) Photomagnetic Disk. (4) EMBOSSING MACHINE (5) ELECTROFORMING SYSTEM, EQUIPMENT AND MATERIAL. (6) EMBOSSING MATERIAL. (7) ELECTRO-OPTICS APPARATUS AND INSTRUMENT. (8) PRECISION OPTICAL ELEMENT AND COMPONENT. (9) OPTICAL COATING. (10) SMART CARD, SECURITY CARD AND RELATED EQUIPMENT. (11) Electronic Parts and Components Manufacturing (12) Restrained Telecom Radio Frequency Equipments and Materials Manufacturing (13) Photographic and Optical Equipment Manufacturing (14) Restrained Telecom Radio Frequency Equipments and Materials Import (15) Software Design Services (16) LCOS Projection Engine (17) Projector, Smart Projector and Optical touch module (18) Digital wireless public address system 2. Import and export trade of the above-mentioned related products.	Revise according to practical needs

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Provision After Revision	Original Provision	Revision Description
Chapter 2 Share Article 5: The total capital of the Company is set at NT$ 3 billion, which is divided into 300 million shares, with amount of each share is NT$ 10.00, of which the unissued shares are authorized to be issued by the board of directors in several installments, and the shares with large face value may be issued due to business needs. Twenty million shares, accounting for NT$ 200 million, are retained in the total capital referred to in the preceding paragraph, and the equity security, special shares with warrants or corporate bonds with warrants are used for the exercise of stock options.	Chapter 2 Share Article 5: The total capital of the Company is set at NT$ 2 billion, which is divided into 200 million shares, with amount of each share is NT$ 10.00, of which the unissued shares are authorized to be issued by the board of directors in several installments, and the shares with large face value may be issued due to business needs. Twenty million shares, accounting for NT$ 200 million, are retained in the total capital referred to in the preceding paragraph, and the equity security, special shares with warrants or corporate bonds with warrants are used for the exercise of stock options.	Revise according to practical needs
Chapter 7 By-law (Ignored) The 25th revision on May.31, 2019. The 26th revision on May. 28, 2020. The 27th revision on July. 2, 2021	Chapter 7 By-law (Ignored) The 25th revision on May.31, 2019. The 26th revision on May. 28, 2020.	Add revision date

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“Annex 7”

K Laser Technology Inc.

Rules of Procedure for Shareholder Meeting Provision Comparision Table Before/After Revision

Provision After Revision	Original Provision	Revision Description
Article 5: The shareholders' meeting of the Company shall be convened by the board of directors unless otherwise stipulated by laws and regulations. If the shareholders' meeting is convened by the board of directors, its chairman shall be the chairman. If the chairman takes leave or is unable to exercise his functions and powers for some reason, the chairman shall appoint one director to act for him. If the chairman fails to appoint an agent, the directors shall push one another to act for him. If the shareholders' meeting is convened by a convener other than the board of directors, its chairman shall be the convener. The Company shall, 30 days before the Annual General Meeting or 15 days before the temporary shareholders' meeting, make electronic files of the notice of shareholders' meeting, the paper of power of attorney, the case and explanatory materials of various proposals such as recognition cases, discussion cases, selection or dismissal of directors, etc., and send them to the public information observatory. In addition, 21 days before Annual General Meeting or 15 days before the temporary shareholders' meeting, the shareholders' meeting meetig handbook and meeting supplementary materials shall be made into electronic files and sent to the public information observatory. Fifteen days before the meeting of the shareholders' meeting, the minutes handbook and supplementary materials of the meeting shall be prepared for shareholders to consult at any time, and shall be displayed in the Company and the stock affairs agency appointed by the Company, and shall be distributed at the meeting site. The notice and announcement shall specify the reasons for convening; If the notification is approved by the opposite party, it can be made electronically. Selection or dismissal of directors, change of bylaws, capital reduction, application for suspension of public offering, non-competition permission of directors, transfer of profit to capital, transfer of reserve to capital, dissolution, merger, division of companies, or matters in paragraph 1 of Article 185 of theCompany Law, Articles 26-1, 43-6 of the Securities Exchange Act, Articles 56-1 and 60-2 of the Guidelines for Offering and Issuing Securities by Publishershall be listed in the convening reasons and their main contents shall be explained, without proposing by extempore motion. The reasons for convening the shareholders' meetinghave stated the overall re-election of	Article 5: The shareholders' meeting of the Company shall be convened by the board of directors unless otherwise stipulated by laws and regulations. If the shareholders' meeting is convened by the board of directors, its chairman shall be the chairman. If the chairman takes leave or is unable to exercise his functions and powers for some reason, the chairman shall appoint one director to act for him. If the chairman fails to appoint an agent, the directors shall push one another to act for him. If the shareholders' meeting is convened by a convener other than the board of directors, its chairman shall be the convener. The Company shall, 30 days before the Annual General Meeting or 15 days before the temporary shareholders' meeting, make electronic files of the notice of shareholders' meeting, the paper of power of attorney, the case and explanatory materials of various proposals such as recognition cases, discussion cases, selection or dismissal of directors, etc., and send them to the public information observatory. In addition, 21 days before Annual General Meeting or 15 days before the temporary shareholders' meeting, the shareholders' meeting meetig handbook and meeting supplementary materials shall be made into electronic files and sent to the public information observatory. Fifteen days before the meeting of the shareholders' meeting, the minutes handbook and supplementary materials of the meeting shall be prepared for shareholders to consult at any time, and shall be displayed in the Company and the stock affairs agency appointed by the Company, and shall be distributed at the meeting site. The notice and announcement shall specify the reasons for convening; If the notification is approved by the opposite party, it can be made electronically. Electing or dismissing directors, changing bylaws, reducing capital, applying to stop public offering, directors' non-competition permission, transferring profit to capital increase, transferring reserve to capital increase, company dissolution, merger, division, or various items in Item 1 of Article 185 shall be listed in the convening reasons and explain their main contents, and shall not be proposed by extempore motion; Its main contents may be placed on the website designated by the securities authority or the company, and its website address shall be stated in the notice.	According to the reference example of the revised "Rules of Procedure for the Shareholders' Meeting of oo Co., Ltd." issued by Taiwan Stock Exchange on January 28, 2021 (TZJGZZ No.1100014461), it is revised.

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Revision Provision After Revision Original Provision Description directors and the date of taking office. After the The reasons for convening the shareholders' re-election of the shareholders' meeting is meeting have stated the overall re-election of completed, the date of taking office may not be directors and the date of taking office. After the changed by temporary motion or other means at the re-election of the shareholders' meeting is same meeting. completed, the date of taking office may not be According to the Shareholders holding more than 1% of the total changed by temporary motion or other means at number of issued shares may submit a resolution of the same meeting. reference example of the the Annual General Meeting to the Company, with Shareholders holding more than 1% of the total revised "Rules of only one resolution. Any resolution with more than number of issued shares may submit a resolution Procedure for the one resolution shall not be included in the of the Annual General Meeting to the Company, Shareholders' Meeting of resolution. However, the shareholders' proposal is with only one resolution. Any resolution with oo Co., Ltd." issued by to urge the company to promote public interests or more than one resolution shall not be included in Taiwan Stock Exchange fulfill social responsibilities, and the board of the resolution. However, the shareholders' on January 28, 2021 directors may still include the proposal. In addition, proposal is to urge the company to promote public if the proposal put forward by shareholders falls interests or fulfill social responsibilities, and the (TZJGZZ into one of the situations in Item 4 of Article 172-1 board of directors may still include the proposal. No.1100014461), it is of the Company Law, the board of directors may In addition, if the proposal put forward by revised. not list it as a proposal. shareholders falls into one of the situations in The Company shall announce the acceptance of Item 4 of Article 172-1 of the Company Law, the shareholders' proposal, written or electronic board of directors may not list it as a proposal. acceptance method, acceptance place and The Company shall announce the acceptance of acceptance period before the stock transfer stop shareholders' proposal, written or electronic date before the shareholders' regular meeting; The acceptance method, acceptance place and acceptance period shall not be less than ten days. acceptance period before the stock transfer stop The proposal put forward by shareholders is limited date before the shareholders' regular meeting; The to 300 words, and if it exceeds 300 words, the acceptance period shall not be less than ten days. proposal will not be included in the resolution; The The proposal put forward by shareholders is shareholders of the proposal shall attend the limited to 300 words, and if it exceeds 300 words, shareholders' regular meeting in person or entrust the proposal will not be included in the resolution; others to participate in the discussion of the The shareholders of the proposal shall attend the resolution. shareholders' regular meeting in person or entrust The Company shall notify the proposer others to participate in the discussion of the shareholders of the processing results before the resolution. date of the notice of convening the shareholders' The Company shall notify the proposer meeting, and list the proposals in accordance with shareholders of the processing results before the the provisions of this Article in the notice of date of the notice of convening the shareholders' meeting. For shareholders' proposals that are not meeting, and list the proposals in accordance with included in the resolution, the board of directors the provisions of this Article in the notice of shall explain the reasons for not including them at meeting. For shareholders' proposals that are not the shareholders' meeting. included in the resolution, the board of directors shall explain the reasons for not including them at the shareholders' meeting.

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Provision After Revision	Original Provision	Revision Description
Article 8 When the meeting starts, the chairman shall announce the meeting to start immediately,and at the same time announce the relevant information such as non-voting rights and attending shares. However, if shareholders representing more than half of the total number of issued shares are not present, the chairman may announce the postponement of the meeting, and the times of postponements shall be limited to two, and the total postponement time shall not exceed one hour. If the delay for twice is still insufficient and shareholders representing more than 1/3 of the total issued shares are present, it may be deemed as a false resolution according to Item 1 of Article 175 of the Company Law. Before the end of the current meeting, if the number of shares represented by the shareholders present reaches more than half of the total issued shares, the chairman may make a false resolution and submit it to the General Assembly for voting in accordance with Article 174 of the Company Law.	Article 8 When the meeting starts, the chairman shall announce the meeting to start immediately. However, if shareholders representing more than half of the total number of issued shares are not present, the chairman may announce the postponement of the meeting, and the times of postponements shall be limited to two, and the total postponement time shall not exceed one hour. If the delay for twice is still insufficient and shareholders representing more than 1/3 of the total issued shares are present, it may be deemed as a false resolution according to Item 1 of Article 175 of the Company Law. Before the end of the current meeting, if the number of shares represented by the shareholders present reaches more than half of the total issued shares, the chairman may make a false resolution and submit it to the General Assembly for voting in accordance with Article 174 of the Company Law.	According to the reference example of the revised "Rules of Procedure for the Shareholders' Meeting of oo Co., Ltd." issued by Taiwan Stock Exchange on January 28, 2021 (TZJGZZ No.1100014461), it is revised.
Article 19 When there is a proposal to elect directors at the shareholders' meeting, it shall be handled in accordance with the relevant election standards set by the Company, and the election results shall be announced on the spot, including the list of elected directors and their election weights, and the list of unelected directors and supervisors and their obtained voting rights. The electoral votes for the electoral matters referred to in the preceding paragraph shall be sealed and signed by the scrutinizer, and shall be properly kept for at least one year. However, if the shareholder brings the lawsuit in accordance with Article 189 of the Company Law, it shall be kept until the end of the lawsuit.	Article 19 When there is resolution to elect directors in the shareholders' meeting, it shall be handled in accordance with the relevant selection standards set by the Company, and the election results shall be announced on the spot, including the list of elected directors and their election weights. The electoral votes for the electoral matters referred to in the preceding paragraph shall be sealed and signed by the scrutinizer, and shall be properly kept for at least one year. However, if the shareholder brings the lawsuit in accordance with Article 189 of the Company Law, it shall be kept until the end of the lawsuit.	According to the reference example of the revised "Rules of Procedure for the Shareholders' Meeting of oo Co., Ltd." issued by Taiwan Stock Exchange on January 28, 2021 (TZJGZZ No.1100014461), it is revised.
Article 24: By-laws Any matters not covered in this procedure shall be handled in accordance with relevant laws and regulations. This procedure was formulated on June. 21, 1998. The 1st revision on April.12, 2000. The 2nd revision on March. 28, 2001. The 3rd revision on May. 27, 2002. The 4th revision on May. 28, 2020. The 5th revision on July.2, 2021	Article 24: By-laws Any matters not covered in this procedure shall be handled in accordance with relevant laws and regulations. This procedure was formulated on June. 21, 1998. The 1st revision on April.12, 2000. The 2nd revision on March. 28, 2001. The 3rd revision on May. 27, 2002. The 4th revision on May. 28, 2020.	Add revision date.

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“Annex 8”

K Laser Technology Inc.

2021 Measures for the issuance of new shares restricting employees' rights

Revision date of Board of Directors is March 23, 2021

Chapter 1: Issuance Purpose

In order to attract and accept key talents and achieve the company's medium and long-term goals, the Company can encourage employees to go all out to achieve the Company's operational goals, create a higher profit for the Company and shareholders, and ensure the combination of the interests of employees and shareholders, in accordance with Article 267, Item 9, of the Company Law and the relevant provisions of the "Guidelines for the Offering and Issuance of Securities by Publishers" (hereinafter referred to as the "Guidelines for Offering and Issurance"), the Company's Measures for the issuance of new shares restricting employees' rights (hereinafter referred to as the "Measures") are formulated.

Article 2: Issuance Period

It shall be reported once or in installments within one year from the date of the resolution of the shareholders' meeting, and shall be issued once or in installments according to actual needs within one year from the date of arrival of the effective notice of approval of the declaration by the competent authority, and the actual issuance date shall be determined by the chairman authorized by the board of directors.

Article 3: Issuance Condition

(i) Issuance Price: Free issuance, issuance price per share is NT$ 0.
(ii) The types of shares issued and given to employees this time are ordinary shares and new shares, and their rights and obligations are the same as those of other common shares in circulation, except for the rights restricted before the vested conditions are met in accordance with Article 6.

(iii) Vesting Conditions

Employees are still in office on each vested day after being allocated new shares that restrict employees' rights, and during this period, the Company has determined that there has been no violation of the Company's labor contract, employee code of conduct, trust deed, corporate governance code of practice, code of good faith operation, working rules, code of non-competition and confidentiality, or contractual agreement with the Company, etc., and

42 -

achieved the following operational objectives set by the Company:

(1) The 1st Year Expiration: The operating revenue of each individual hologram increased by more than 10% (included) compared with the previous year.
(2) The 2nd Year Expiration: The operating revenue of each individual hologram increased by more than 15% (included) compared with the previous year.
(3) The 3rd Year Expiration: The operating revenue of each individual hologram increased by more than 16% (included) compared with the previous year.
(4) The 4th Year Expiration: The operating revenue of each individual hologram increased by more than 17% (included) compared with the previous year.
(5) The 5th Year Expiration: The operating revenue of each individual hologram increased by more than 17% (included) compared with the previous year.

The vested proportions on the vested days of each year are as follows. If the vesting conditions are not met, the Company will not take back the new shares with limited employee rights in that year and continue to deliver them to the trust for safekeeping. After the expiration of five years, when the employees meet the vesting conditions and the operating income of each individual in the fifth year expiration, it will be more than 100% (included) higher than that in 2020.

  - (1) The expiration of 1 year: 15%

  - (2) The expiration of 2 years: 15%

  - (3) The expiration of 3 years: 20%

  - (4) The expiration of 4 years: 20%

  - (5) The expiration of 5 years: 30%

(iv) Treatment of employees failing to reach vesting conditions
If an employee fails to meet the personal performance evaluation index and the company's operation target after being allocated with new shares restricting employees' rights, if he/she is absent from work on a vested day, violates the circumstances listed in Paragraph 1, Item 3, Article 3, etc., he/she will return the new shares restricting employees' rights without compensation and cancel them.
During the vested period, if an employee voluntarily leaves his position, dismisses or is laid off, the Company will take back the shares he/she has not vested without compensation and cancel them.
(v) When the following reasons occur, the new shares that have not been vested to restrict employees' rights shall be handled in the following ways:
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Temporary leave without salary:

The rights and obligations of new shares that have not yet been vested to restrict employees' rights are not affected, but still need to be determined in accordance with these Measures; However, in addition to the vesting conditions stipulated in these Measures, the actual shares vested in each year shall be calculated according to the proportion of employees' actual working months in each operating target year. On the vested date, if it is in a state of temporary leave without salary, it will be deemed that the vesting conditions have not been met, and the Company will take back the new shares restricting employees' rights free of charge and cancel them.

Transfer related enterprise:

If a related enterprise is transferred upon its own request, the Company will take back the new shares which have not yet been vested and which restrict the rights of employees without compensation. If, due to the operational needs of the Company, it is approved by the Company to be transferred to a related enterprise, the rights and obligations of the new shares that have not yet been vested to restrict the rights of employees will not be affected, but still need to be determined in accordance with these Measures; The Company's operating objectives are calculated based on the achievement of the company's operating objectives, but the personal performance objectives need to be re-measured by the performance standards after being transferred to related enterprises; In addition, it is necessary to continue to work for related enterprises or the Company on the existing day, otherwise, it will be deemed that the vesting conditions are not met, and our company will take back the new shares that have not been vested and restrict the rights of employees without compensation and cancel them.

Retirement

The rights and obligations of new shares that have not yet been vested to restrict employees' rights are not affected, and still need to be determined in accordance with these Measures; However, in addition to the vesting conditions stipulated in these Measures, the actual shares vested in each year shall be calculated according to the proportion of employees' actual working months in each operating target year.

Unable to continue to hold office due to physical disability caused by occupational disaster: New shares with limited employee rights that have not yet been vested can be vested on the date of departure, but for the vested years in which the Company's operation and personal performance goals have been confirmed, the actual shares vested in each year shall be calculated according to the vesting conditions stipulated in these Measures; For vested years
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when it is impossible to confirm the degree of achievement of the Company's operation and personal performance objectives, all the new shares that have not yet been vested and restrict employees' rights can be vested.

Common death or death due to occupational disaster:
- When an employee dies, he has not vested new shares that restrict employee rights, and the heirs can apply to receive the shares they should inherit or the rights and interests that have been disposed of after completing the necessary legal procedures and providing relevant supporting documents. However, if an employee dies, the actual shares that can be acquired in each vested year for which the degree of achievement of the Company's operation and personal performance goals has been confirmed shall be calculated according to the acquired conditions set out in these Measures; For vested years when it is impossible to confirm the degree of achievement of the company's operation and personal performance objectives, all the new shares that have not yet been acquired and restrict employees' rights can be vested.
If the company makes organizational adjustment according to the M&A law, it has not already restricted its employee’s rights new shares shall be regarded as having achieved the vesting conditions or failing to reach the vesting conditions and the ratio of the vesting conditions to the vested ones, and shall be approved by the board of directors.
In case of special circumstances, such as outstanding contributions of employees to the Company, when the employment relationship is terminated, the new shares that have not yet been vested to restrict employees' rights shall be deemed to have reached the vesting conditions or failed to reach the vesting conditions and the vested ratio, and the chairman shall be authorized to make individual approval according to the actual conditions, but the manager shall first obtain the approval of the remuneration committee.
(vi) The Company will cancel the new shares with restricted employees' rights which are recovered by the Company free of charge.

Article 4: Total Amount of Issuance

A total of 5,000,000 new shares of common stock were issued and granted to employees this time, with face value of NT$ 10.00, and total amount of NT$ 50,000,000.

Article 5: Qualification Condition of Employee

(i) The full-time employees of the Company and controlled or subordinate companies that meet certain conditions have achieved certain performance and met the following principles on each vested day after being allocated new shares with limited employee rights:
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It is highly related to the Company's future strategic development
Core Key Technical Talent
(ii) The number of new shares that can be allocated to restrict employees' rights shall be approved based on work years, position level, position, work performance, overall contribution, special achievement or other reference to management and other factors, by the chairman of the board of directors and then reported to the board of directors for approval. However, employees who are directors and managers should first obtain the approval of the Remuneration Committee.
(iii) Individuals holding more than 10% of the issued common shares of the Company are not eligible for issuance. Remuneration Committee members and board members without employee status are not eligible for payment.
(iv) The cumulative number of shares acquired by a single employee to restrict employees' rights plus the cumulative number of subscribed shares issued with employee stock options issued by the Company in accordance with Paragraph 1 of Article 56-1 of the Offering Standards shall not exceed three thousandth of the total issued shares of the Company, and the cumulative number of subscribed shares issued with employee stock options issued by the Company in accordance with Paragraph 1 of Article 56 of the Offering Standards shall not exceed one percent of the total issued shares of the Company. If the project is approved by the competent authority of each central purpose enterprise, the total number of employees' share option certificates and new shares that restrict employees' rights obtained by a single employee may not be restricted by the preceding proportion. If the competent authority updates the relevant regulations, it shall comply with the updated laws and regulations of the competent authority.
Article 6: The rights restricted before the vesting conditions are met after the allocation of new shares
(i) The employee shall not sell, pledge, transfer, give to others, set up, or divide the new shares that restrict the employee's rights in other ways, except for inheritance, before the vesting conditions are reached after being allocated with new shares.
(ii) The rights of attending, proposing, speaking, voting and election rights of the shareholders' meeting are the same as those of the issued common shares of the Company, and shall be implemented in accordance with the trust custody contract.
(iii) Before the vested conditions are met, the new shares allocated to employees in accordance with these Measures will not have the right to distribute profit (including but not limited to dividends, dividends, statutory reserves and the right to allocate capital reserves) and the right to cash capital increase.
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(iv) If it is returned to the present due to the capital reduction of the company during the vested period, the capital reduction refund that has not been vested due to the allocation shall be delivered to the trust, and when the vesting conditions and deadlines are reached, it shall be delivered to the employees without interest together with the vested shares; However, when the expiry date fails to meet the acquired conditions, the Company will recover the cash.
(v) The transfer stop date of the company's free share allotment, cash dividend, cash capital increase and subscription, the transfer stop period of shareholders' meeting as stipulated in Paragraph 3, Article 165 of the Company Law, or other legal transfer stop period occurring according to the facts until the base date of rights distribution. For employees who meet the vested conditions during this period, the time and procedures for lifting the restrictions on their vested shares shall be implemented in accordance with the trust custody contract or relevant laws and regulations.

Article 7: Other Appointed Matters

(i) After the issuance of new shares that restrict employees' rights, stock trust custody shall be handled. And before the vesting conditions are fulfilled, the employee shall not request the trustee to return the new shares that restrict the employee's rights for any reason or manner.
(ii) During the period when the new shares with restricted employees' rights are delivered to the trust custody, the Company or the person designated by the Company shall have full authority to negotiate, sign, revise, extend, dissolve and terminate the trust custody contract with the stock trust custody institution, and give instructions on the delivery, use and disposition of the trust custody property.

Article 8: Signing Contract and Confidentiality

(i) Employees who are allocated new shares with restricted employees' rights shall be deemed to have obtained new shares with restricted employees' rights only after signing the "Acceptance Agreement for New Shares with Restricted Employees' Rights" and handling relevant trust custody procedures according to the notice of the organizer of the company. If the signing of relevant documents is not completed according to regulations, it shall be deemed as giving up new shares restricting employees' rights.
(ii) Employees and any owners who have obtained new shares and derivative rights that restrict employees' rights through these Measures shall abide by the provisions of these Measures and the "Consent for Receiving New Shares that Restrict Employees' Rights", and offenders shall be deemed to have failed to meet the vested conditions; In addition, the Company shall abide by
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the salary confidentiality regulations of the Company, and shall not inquire about others or disclose the relevant contents and quantity of the granted new shares with limited employee rights, or inform others of the relevant contents and personal rights of this case. In case of any violation, the Company has the right to recover and cancel the new shares with limited employee rights that have not yet reached the vested conditions without compensation.

Article 9: Tax

The taxes related to the new shares with restricted employee rights allocated in accordance with these Measures shall be handled in accordance with the regulations of the then ROC.

Article 10: Other Important Matters

(i) These Measures shall come into effect after being attended by more than two-thirds of the directors of the board of directors and approved by more than one-half of the directors present, and reported to the competent authority after passing the resolution of the shareholders' meeting. If it is necessary to amend the regulations due to the revision of laws and regulations, the audit requirements of the competent authority and other factors, the chairman of the board of directors shall be authorized to amend the regulations, and then the regulations shall be submitted to the board of directors for ratification before issuance.
(ii) If there are any matters not covered in these Measures, unless otherwise provided by laws and regulations, the board of directors or its authorized person shall be fully authorized to amend or implement them in accordance with relevant laws and regulations.
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K LASER — AGM Information 2021

52100_rns_2021-07-09_b7c082a0-cca5-40a0-82b4-1a510555b9d3.pdf

2021 Annual Shareholder’s Meeting Minutes

A. Chairman Address (omitted)

B. Report Items

C. Ratification Items

D. Discussion Items

Voting Results:

E. Extraordinary Motions: NA

Business Report

To Shareholders Summary

Technology Development

Our Strategy and Global Situation

Independent Auditors’ Report

Opinion

Basis for Opinion

Key Audit Matters

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

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

K Laser Technology Inc. and its Subsidiaries

Consolidated Balance Sheet

December 31, 2020 and 2019

K Laser Technology Inc. and its Subsidiaries Consolidated Statement of Changes in Equity For the years ended December 31, 2020 and 2019

Equity Attributable to Shareholders of the Parent Company

K Laser Technology Inc. and its Subsidiaries Consolidated Statement of Cash Flows

For the years ended December 31, 2020 and 2019

Unit: In Thousands of New Taiwan Dollars

Independent Auditors’ Report

Opinion

Basis for Opinion

Key Audit Matters

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

Auditors’ Responsibilities for the Audit of the Financial Statements

K Laser Technology Inc.

Balance Sheet

K Laser Technology Inc. Statement of Comprehensive Income For the years ended December 31, 2020 and 2019

K Laser Technology Inc. Statement of Changes in Equity For the years ended December 31, 2020 and 2019

K Laser Technology Inc.

Statement of Cash Flows

K Laser Technology Inc. Disposition of Net Profit

2020

K Laser Technology Inc.

K Laser Technology Inc.

Rules of Procedure for Shareholder Meeting Provision Comparision Table Before/After Revision

K Laser Technology Inc.

2021 Measures for the issuance of new shares restricting employees' rights

Chapter 1: Issuance Purpose

Article 2: Issuance Period

Article 3: Issuance Condition

(iii) Vesting Conditions

Article 4: Total Amount of Issuance

Article 5: Qualification Condition of Employee

Article 7: Other Appointed Matters

Article 9: Tax

More from K LASER

K LASER AGM Information 2021