KYEC — AGM Information 2023

Jun 7, 2023

Stock symbol: 2449

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2023 Annual General Meeting Handbook

May 30, 2023

Contents

	Contents	Contents
I.	Meeting Procedure ----------------------------------------------------------------------- 1
II.	Meeting Agenda -------------------------------------------------------------------------- 2
	1.	Reporting Items ------------------------------------------------------------------ 3
	2.	Ratification Items ---------------------------------------------------------------- 7
	3.	Elections --------------------------------------------------------------------------- 9
	4.	Discussion Items --------------------------------------------------------------- 10
	5.	Extraordinary Motions -------------------------------------------------------- 11
III.	Annexes
	1.	Business Report (Annex 1) --------------------------------------------------- 12
	2.	Audit Report by the Audit Committee (Annex 2) -------------------------- 17
	3.	Comparison Table before and after amendment of Rules and Procedures
		for Board of Directors Meetings (Annex 3) -------------------------------- 18
	4.	2022 Earnings Distribution (Annex 4) -------------------------------------- 21
	5.	CPA Audit Report and Financial Statements (Annex 5) ------------------ 22
	6.	List of candidates of directors (including independent directors) (Annex 6)
		------------------------------------------------------------------------------------ 42
IV.	Appendices
	1.	Rules of Procedure for Shareholders’ Meetings (Appendix 1) ----------- 44
	2.	Rules Governing the Election of Directors (Appendix 2) ---------------- 46
	3.	Articles of Incorporation (Appendix 3) ------------------------------------- 49
	4.	Rules of Procedures for Board of Directors Meetings (Appendix 4) ---- 55
	5.	Number of Shares Held by All Directors and Minimum Number of Shares
		to be Held (Appendix 5) ------------------------------------------------------- 63
	6.	The Impact of Stock Dividend Issuance on Business Performance, EPS,
		and Shareholder’s Return on Investment (Appendix 6) ------------------- 64

King Yuan Electronics Co., Ltd.

2023 Annual General Meeting Procedure

I. Call the Meeting to Order

II. Chairperson Remarks

III. Reporting Items

IV. Ratification Items

V. Elections

VI. Discussion Items

VII. Extraordinary Motions

VIII. Meeting Adjourned

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King Yuan Electronics Co., Ltd.

2023 Annual General Meeting Agenda

Convention Method: Physical Convention of Annual General Meeting

Time: 9 a.m. on Tuesday, May 30, 2023

Place: 2F., No. 6, Yule St., Toufen City, Miaoli County (Conference Room 205, Grand Royal Hotel)

Chair: Chairperson Chin-Kung Lee

• I. Call the Meeting to Order

• II. Chairperson Remarks

• III. Reporting Items

• The Company’s 2022 Business Overview.

• The Audit Committee’s Review of the Company’s 2022 Financial Report.

• The Company’s 2022 Distribution of Employee and Director Remuneration.

• The Company's amendment to the “Rules and Procedures for Board of Directors Meetings.”

• IV. Ratification Items

• The Company’s 2022 Business Report and Financial Statements.

• The Company’s 2022 Distribution of Earnings.

• V. Elections

Election of the 15th term of Board of Directors.

• VI. Discussion Items

• Request for review of the proposed removal of non-compete clause for the Company's directors.

VII. Extraordinary Motions

• VIII. Meeting Adjourned

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Reporting Items

Report No. 1 Proposed by the Board of Directors

Motion: The Company’s 2022 Business Overview. Description: For the 2022 business report, please refer to page 12 (Annex 1).

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Report No. 2 Proposed by the Board of Directors

Motion: The Audit Committee’s Review of the Company’s 2022 Financial Report.

• Description: 1. The Company’s 2022 final accounting reports have been reviewed and certified by accountants and the Audit Committee. A review report and audit report have been issued.

• For the audit report prepared by the Audit Committee, please refer to Annex 2 on page 17.

• For the review report prepared by the CPA, please refer to Annex 5 on page 22.

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Report No. 3

Proposed by the Board of Directors

Motion: The Company’s 2022 Distribution of Employee and Director Remuneration.

• Description: 1. According to Article 19, Paragraph 1 of the Company’s Articles of Incorporation: “Where there is a profit in the current year, the Company shall allocate 8–10 percent of the profit as the remuneration to employees, and no more than 1 percent thereof as directors’ remuneration. However, profits must first be taken to offset against cumulative losses if any.”

• The Company's profit in 2022 totaled NT$9,328,704,652 (i.e., earnings before tax less remuneration to employees and directors), 8 % thereof was allocated as the remuneration to employees in cash, i.e. NT$746,296,373, and 0.8 % thereof as the remuneration to directors, i.e. NT$74,629,637.

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Report No. 4

Proposed by the Board of Directors

Motion: The Company's amendment to the “Rules and Procedures for Board of Directors Meetings.”

• Description: 1. The Company has amended Articles 3, 7, and 19 of the “Regulations Governing Procedure for Board of Directors Meetings of Public Companies” in accordance with amendments to Articles 3, 7, and 19 of the “Regulations Governing Procedure for Board of Directors Meetings of Public Companies” as stated in Jin-Guan-Zheng-Fa No. 1110383263 issued by the Financial Supervisory Commission on August 5, 2022.

• Please refer to Annex 3 on page 18 for the Comparison Table before and after amendments to the Company’s “Rules and Procedures for Board of Directors Meetings.”

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Ratification Items

Ratification No. 1

Proposed by the Board of Directors

Motion: The Company’s 2022 Business Report and Financial Statements.

• Description: 1. The Company’s 2022 Business Report and Financial Statements have been approved in the 24th meeting of the 14th-term Board of Directors and were audited by the Audit Committee, and a written report of such audit has been issued.

• For the aforementioned Business Report and Financial Statements, please refer to Annex 1 on page 12 and Annex 5 on page 22.

Resolution:

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Ratification No. 2

Proposed by the Board of Directors

Motion: The Company’s 2022 Distribution of Earnings.

• Description: 1. The Company’s 2022 distribution of earnings report has been approved in the 24th meeting of the 14th-term Board of Directors and audited by the Audit Committee, and a written report of such audit has been issued.

• For the distribution of earnings report that was prepared in accordance with the provisions of the Company Act and the Company’s Articles of Incorporation, please refer to page 21 (Annex 4).

• If the Company made substantial investment using the undistributed earnings after the distribution of the 2022 earnings, the Company shall apply for reduction of the amounts of undistributed earnings or refund of excess payment under the preferential taxation provisions stipulated in Article 23-3 of the “Statute for Industrial Innovation.”

Resolution:

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Elections

Elections

Proposed by the Board of Directors

Motion: Election of the 15th term of Board of Directors.

• Description: 1. The Company’s 14th-term Board of Directors was set to expire on June 9, 2023; however, given the date of the shareholders’ meeting, the date of expiration will be brought forward to the day of election of the 15th term of Board of Directors.

• In accordance with Article 13 of the Company's Articles of Incorporation, nine directors (including three independent directors) will be elected at the 2023 Shareholders’ Meetings. The new board members will serve a term of three years, beginning on May 30, 2023 and ending on May 29, 2026.

• The Company shall adopt a candidate nomination system for election of and directors. The shareholders shall elect the directors from among the nominees listed on the roster. Please refer to Annex 6 on page 42 for the education background, past work experience, and other relevant information of the director candidates.

• Please elect as proposed.

Election result:

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Discussion Items

Discussion No. 1 Proposed by the Board of Directors

Motion: Request for review of the proposed removal of non-compete clause for the Company's directors.

• Description: 1. Because the Company’s new directors may be engaged in the investment or operation of a business entity whose scope of business is identical or similar to that of the Company and acts as a director thereof, we hereby propose to remove the non-compete clause for directors in accordance with Article 209 of the Company Act, provided that such removal will not infringe upon the interests of the Company.

• The list of directors proposed for the termination of non-completion restriction:

  • (1) Chin-Kung Lee, acting as the director of King Long Technology (Suzhou) Ltd. and Suzhou Zhen Kun Technology Ltd.

  • (2) An-Hsuan Liu, acting as the director of King Long Technology (Suzhou) Ltd. and Suzhou Zhen Kun Technology Ltd.

Resolution:

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Extraordinary Motions

Meeting Adjourned

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(Annex 1)

King Yuan Electronics Co., Ltd. Business Report

Business Plan Implementation Results

The consolidated operating revenue was NT$36.782 billion last year, up by 8.95%. Gross profit margin was 35.5%, an increase of 4.8% compared with previous year. Earnings per share (EPS) was NT$5.59, also up by NT$1.36 from previous year. The Company delivered favorable business performance in general.

A review of last year's performance up until Q3, customers have adjusted their inventories, which reflected the significant impact that the general political and economic environment has on demand. The establishment of economic recession resulted in low visibility, exposing the semiconductor industry to severe challenges. With the concerted efforts of our employees, the Company was able to further increase its operating revenue for the year, thanks to contributions in terms of automotive applications, industrial applications, servers, data center, network communication products, and increased production outsourcing by foreign customers. Our gross profit market increased considerably, which is attributable to increase in average unit price and improved cost management. Net income before tax also increased significantly owing to our adequate control of management and sales expenses. Over the years, the Company observed that recruiting talents is not easy. We have therefore continuously invested in resources to automate factory operations, adopt smart manufacturing practices, streamline processes, improve production efficiency, and reduce our reliance on labor work. Our investments have gradually come to fruition. The Company also continued making changes and improvements in the areas of production flexibility, technical know-how, quality standard, delivery speed, customer service satisfaction, information management, employee cultural literacy, ESG performance, and operational systems to unleash our powerful resilience in adapting to the fast-changing environment.

Financial income and profit analysis

With respect to financial and profit status in 2022, the Company saw a sound financial structure, with debt to total assets ratio of 50.31% down slightly by 1.4% from previous year, and long-term capital to fixed assets ratio of 133.53%, up 5.4% compared with last year. Current ratio and quick ratio increased by 48.92% and 47.22% from previous year, reaching 218.06% and 201.13%, respectively, which suggests favorable short-term liquidity. In terms of profitability, the Company’s return on assets (ROA), return on equity (ROE), net profit margin, and earnings per share were 10.13%, 19.44%, 18.98%, and NT$5.59, respectively, which increased by 1.88%, 3.14%, 3.48%, and NT$1.36 compared with previous year, demonstrating record-high performance.

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R&D status

The Company’s R&D center is not only committed to helping customers solve technical problems in product testing but also spares no effort in following a R&D blueprint to develop and improve the functions and performance of testing equipment and key components. We constantly update the specifications of our testing machines to meet customer needs and requirements for high-tech product development, while also focusing on ensuring the conversion compatibility of testing equipment adapters and testing platforms. With respect to testing software, we respond to the increased complexity of testing equipment and customer products by devoting to the development of testing software and adoption of artificial intelligence to improve production efficiency and user convenience. In terms of testing system integration, we endeavor to improve the scalability and functional performance of self-developed testing machines and burn-in ovens, both of which are available in abundance (1800+ machines) at KYEC and its subsidiaries. In the areas of self-developed equipment applications, our testing platform encompasses a broad category of products, including System on Chip (SoC), image sensor chip, driver chip, microelectromechanical chip, memory chip, and biochip, etc. We stay ahead of technological advancements by developing new testing technologies such as high-frequency, high-power, high-order packaging and heterogeneous packaging technologies to maintain our unique competitive edge in the field of IC testing.

Current business plan overview

We planned to develop our business by achieving breakthrough in performance growth targets, accurately deploying new investments, and promoting our self-developed machine business. Specifically, we focused on the following actions: Improve customer services by taking the lead in customer satisfaction evaluations, preventing significant quality costs, taking response measures and performing monitoring; Improve production and manufacturing processes by reducing ineffective operations, enhancing production efficiency, expanding the scope of smart manufacturing and automation, and refining our professional competency and technical know-how; Enforce cost control by focusing on the costs of materials and accessories and adopting mechanisms that ensure reasonable use of materials and strengthened inventory management; Engage in R&D innovation with a focus on developing core technologies, expanding the applications of key equipment and components, and continuing to ensure the quality of our intellectual properties and patents; and Enhance human resources by retaining key talents, supporting management associates who show potential, and cultivating key technical competencies.

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Future development strategy

The environment of the semiconductor industry has changed in recent years, resulting in the concentration of high-end semiconductor manufacturing in Taiwan. The Company’s future development strategy will be focused on two aspects. The first focus is on customer service, where we aim to strengthen the core value of the manufacturing supply chain, improve the operational efficiency and performance of systems used in the lengthy manufacturing process, support customers' product launch, and grow together with customers as their trusted partner. The second focus is on leveraging the Company’s unique competitive advantages in the research and development of semiconductor testing to deepen customer adhesion toward our services.

We will also continue to expand the business of our fabless semiconductor design company in Europe, the United States, and Japan, cultivate potential customers, and increase the proportion of IDM outsourcing orders to strengthen and stabilize our profitability. Given the technological conflict between China and the United States and the fragmentation of the global semiconductor supply chain, the Company will, at all times, evaluate and adjust its supply chain plans in Taiwan and China to prepare for any possible changes in the environment.

The effect of external competition, the legal environment, and the overall business environment

According to Gartner, a research and consulting firm, worldwide semiconductor revenue increased 1.1% in 2022 to total $602 billion, and is projected to decrease 6.5% in 2023 to US$563 billion. The World Semiconductor Trade Statistics (WSTS) expected the worldwide semiconductor market to reach 4.4% growth or a value of US$580 billion in 2022, followed by a decline of 4% in 2023 to US$557 billion. Destocking of both memory and logic products remains prevalent in the first half of this year, while a new product inventory cycle will be established in the second half of the year. Most semiconductor operators were generally conservative about the annual growth of the worldwide semiconductor industry due to global overall economic and political uncertainties.

The IMF's global growth forecast for 2022 was at 3.2% while its projection for 2023 is lowered to 2.7%. The World Bank predicted that global GDP will grow by 2.9% in 2022 and slashed its estimates to 1.7% for 2023. This year's global economic growth is extremely concerning due to uncertainties from a mixture of factors such as inflation, interest rate, exchange rate, unemployment rate, consumer spending power, U.S. dollar liquidity, U.S. debt ceiling, and complex geopolitical issues.

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In terms of external competition, the node of worldwide semiconductor IC design and manufacturing has reached the limitations of Moore's Law, and advanced manufacturing and packaging technologies have been mass-produced for use by major international design companies. Taiwan dominates the outsourcing of semiconductor manufacturing, and much of that dominance comes down to only a handful of companies. KYEC has become the second largest manufacturer in the world in the field of semiconductor IC testing, making significant strides to stay ahead of its competitors. Taiwan accounts for 62% and 61.5% of the global wafer manufacturing marker and packaging and testing industry, both ranking No. 1 in the world. In the worldwide semiconductor manufacturing supply chain, Taiwan holds 97% of the share of packaging and testing capacity in the Asian market. The semiconductor industry has an extremely extensive and complex ecosystem consisting of tens of thousands of upstream and downstream suppliers that specialize in consumer demand, IC design, manufacturing, system combination, hardware sales, and product applications for different industrial sectors, which render cluster formation, migration, and replication difficult. Semiconductor OEMs in Taiwan have held strong advantages in terms of technology, cost, experience, talent, and efficiency. The formation of a semiconductor supply chain in China and the establishment of semiconductor fabrication plants in the United States, Japan, and Europe are undoubtedly a competition for Taiwanese manufacturers.

In terms of laws and the general business environment, the United States has in recent years clamped down on China's technology and semiconductor development by enforcing more stringent laws. China's semiconductor industry will become an integrated entity confined to the field of mature manufacturing products. In the United States, crack down on China and championing deglobalization will affect the restructuring of certain industry chains in various countries. Although in the semiconductor industry customers are making inquiries, the feasibility is still difficult to consider.

Last year, against the backdrop of rapid global inflation, U.S. interest hikes, and tightened monetary policy, the ripples of the economic shock have caused shrinking demand, GDP decline, and uncertain economic outlook. Governments around the world will have their own challenges to tackle in the future. This year, regardless of political interferences, the world remains situated in a highly uncertain environment characterized by high inflation, high unemployment rate, high interest rate, and low economic growth.

Looking forward to 2023, unfavorable factors are improving; for instance, pandemic restrictions have been lifted, the economy is recovering slowly, the alleviation of supply chain disruption has lifted tensions around semiconductor manufacturing, inflation and sharp interest hikes have eased; the resumption of the semiconductor business cycle is anticipated in the second half of the year following a year of supply–demand adjustments to address the destocking problem. Asian countries with high population density such as China and India may see faster growth opportunities.

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In light of science and technology advances, humans are working more efficiently in pursuit of more convenient and comfortable lifestyles; therefore, more functions and new applications for technological products and services will be developed. The rapid development of advanced semiconductor manufacturing processes and high-end advanced packaging technologies will make people’s dream come true through 5G, AI, IoT, HPC, Metaverse scenarios, and other everyday solutions. Because of the increasing complexity of the core SoC for advanced processes, the upgrading of peripheral mature process chip is promoted so as to increase the silicon content of end products. Base stations and network communication products have emerged as needed to keep pace with transmission bandwidth and speed in communication. Smart cars, smart homes, smart cities, smart health care, smart manufacturing, smart robots, smart stores, which are vigorously developed concepts, will create infinite possibilities and bright prospects for the development of worldwide semiconductor industry.

Chairman:

Manager:

Accounting Supervisor:

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(Annex 2)

King Yuan Electronics Co., Ltd. Audit Committee's audit report

With regard to the Company's 2022 business report, consolidated financial statement (including financial statements of individual entities), and distribution of earnings resolutions prepared and submitted by the Board, the consolidated financial statement (including financial statements of individual entities) has already been audited by Ernst & Young, which has submitted an audit report. The foregoing business report, consolidated financial statement (including financial statements of individual entities), and distribution of earnings resolution has been reviewed by the Audit Committee, which found no discrepancies. The foregoing report has been made pursuant to Article 14-4 of the Securities and Exchange Act and Article 219 of the Company Act, please check.

King Yuan Electronics Co., Ltd.

Convener of the Audit Committee: Hui-Chun Hsu

March 2, 2023

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(Annex 3)

King Yuan Electronics Co., Ltd.

Comparison Table before and after amendment of Rules and Procedures for Board of Directors Meetings

Provision	Provision After Amendment	Provisions Before Amendment	Reason for Amendment
Article 3	The Board of Directors of the Company shall meet at least quarterly. The reasons for calling a board of directors meeting shall be notified to each director and supervisor at least seven days in advance. In emergency circumstances, however, a meeting may be called on shorter notice. The notice to be given under the preceding paragraph may be effected by means of electronic transmission, after obtaining prior consent from the recipients thereof. All matters set out in the subparagraphs of Article 7, paragraph 1, shall be specified in the notice of the reasons for calling a board of directors meeting; none of them may be raised by an extraordinary motion.	The Board of Directors of the Company shall meet at least quarterly. The reasons for calling a board of directors meeting shall be notified to each director and supervisor at least seven days in advance. In emergency circumstances, however, a meeting may be called on shorter notice. The notice to be given under the preceding paragraph may be effected by means of electronic transmission, after obtaining prior consent from the recipients thereof. ~~Except in cases of emergency or~~ ~~d it td b~~	Amendment made in accordance with the laws
		~~uner crcumsances suppore y~~ ~~justifiable reasons,~~all matters set out in the subparagraphs of Article 7, paragraph 1, shall be specified in the notice of the reasons for calling a board of directors meeting; none of them may be raised by an extraordinary motion.

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	Article 7	The following issues shall be raised for discussion in board meetings: I. The Company's business plan. II. Matters required by Paragraph 4 of this Article. III.Donations to related parties or major donations to non-related parties. However, in the occurrence of a major natural disaster, emergency aids of charitable nature can be made first and acknowledged later during the next board meeting. IV. If the board of directors does not have managing directors, the election or discharge of the chairman of the board of directors. V.Any matter required by Article 14-3 of the Securities and Exchange Act or any other law, regulation, or bylaw to be approved by resolution at a shareholders' meeting or board of directors meeting, or any such significant matter as may be prescribed by the competent authority. (Omitted)	The following issues shall be raised for discussion in board meetings: I. The Company's business plan. II. Matters required by Paragraph 4 of this Article. III. Donations to related parties or major donations to non-related parties. However, in the occurrence of a major natural disaster, emergency aids of charitable nature can be made first and acknowledged later during the next board meeting. IV. Any matter required by Article 14-3 of the Securities and Exchange Act or any other law, regulation, or bylaw to be approved by resolution at a shareholders' meeting or board of directors meeting, or any such significant matter as may be prescribed by the competent authority. (Omitted)	Amendment made in accordance with the laws

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Article 19	If the board of directors has managing directors, the provisions of Article 2, paragraph 2 of Article 3, Articles 4 to 6, Article 9, and Articles 11 to theprecedingarticle shall apply mutatis mutandis to the procedure for meetings of the managing directors;and the provisions of paragraph 4 of Article 3 shall apply mutatis mutandis to the election or discharge of the chairman of the board of directors. However, if a meeting of managing directors is scheduled to be convened within seven days, the notice to each managing director may be made two days in advance.	If the board of directors has managing directors, the provisions of Article 2, paragraph 2 of Article 3, Articles 4 to 6, Article 9, and Articles 11 to~~Article 18~~ shall apply mutatis mutandis to the procedure for meetings of the managing directors; However, if a meeting of managing directors is scheduled to be convened within seven days, the notice to each managing director may be made two days in advance.	Amendment made in accordance with the laws

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(Annex 4)

King Yuan Electronics Co., Ltd. 2022 Earnings Distribution Statement

King Yuan Electronics Co., Ltd. 2022 Earnings Distribution Statement	King Yuan Electronics Co., Ltd. 2022 Earnings Distribution Statement	King Yuan Electronics Co., Ltd. 2022 Earnings Distribution Statement	King Yuan Electronics Co., Ltd. 2022 Earnings Distribution Statement
Unit:NT$
Item	Amount		Projected dividend yield
Unallocated earnings – beginning		6,432,521,333
Add: Netprofit after tax	6,836,609,104
Less: Confirmed actuarial gain/loss of welfare	(55,209,588)
The amount of net profit after tax for the period and the amount adjusted to the current year’s undistributed earnings		6,781,399,516
Less: Provision of 10% legal reserve		(678,139,952)
Allocable earnings		12,535,780,897
Scope of allocation
Dividends to shareholders – cash		4,279,607,728	NT$3.5per share
Total allocation		4,279,607,728
Unallocated earnings – ending		8,256,173,169
Note: 1. According to the Company’s distribution policy, the allocable earnings for 2022 shall be allocated as the first priority. The deficit, if any, shall be allocated from the allocable earnings accumulated for the previous year according to the first-in first-out policy in the order of the years in which the earnings were generated chronically. 2. The distribution yield is calculated based on the outstanding common stock totaling 1,222,745,065 shares when the board of directors’ meeting was held. 3. The cash dividend shall be rounded to the whole dollar amount according to the allocation rate. The total of the odd lots less than NT$1 included in the distribution shall be transferred to the employees’ welfare committee. 4. Should the Company encounter a change of share capital that changes the number of outstanding shares on a later date, the board of directors shall be fully authorized to make the necessary adjustments to the percentage of cash dividends allocated to shareholders. 5. The base date for allocation of cash dividends and matters thereto shall be set by the board of directors with authorization upon resolution bythegeneral shareholders’ meeting.

Chairman:

Manager:

Accounting Supervisor:

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(Annex 5)

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English Translation of Financial Statements Originally Issued in Chinese KING YUAN ELECTRONICS CO., LTD. PARENT COMPANY ONLY BALANCE SHEETS As of December 31, 2022 and 2021 (Amounts in thousands of New Taiwan Dollars)	%	10 - - 6 3 - 1 2 - - 22 10 13 54 1 - - - - 78 100	(continued) The accompanying notes are an integral part of the parent company only financial statements.
	December 31, 2021	$6,420,308 178,596 7,706 3,904,721 2,081,340 314,282 430,541 1,029,780 53,284 66,878 14,487,436 6,546,477 8,489,770 34,613,760 553,546 69,247 261,675 105,972 5,394 50,645,841 $65,133,277
	%	15 - - 5 3 - 1 2 - - 26 8 16 49 1 - - - - 74 100
	December 31, 2022	$10,006,747 143,710 7,218 3,491,838 1,782,489 395,412 414,497 1,119,883 82,389 54,930 17,499,113 4,794,451 10,494,138 32,335,080 457,148 35,832 296,256 146,462 5,395 48,564,762 $66,063,875
	Notes	4, 6(1) 4, 6(14), 6(15), 7 4, 6(3), 6(15) 4, 6(4), 6(15) 4, 6(4), 6(15), 7 4, 6(15) 4, 7 4, 6(5) 6(6) 4, 6(2) 4, 6(7) 4, 6(8), 7, 8 4, 6(16) 4, 6(9) 4, 6(20) 8
	ASSETS	Current assets Cash and cash equivalents Contract assets-current Notes receivable, net Accounts receivable, net Accounts receivable from related parties, net Other receivables Other receivables from related parties Inventories, net Prepayments Other current assets Total current assets Non-current assets Financial assets at fair value through other comprehensive income-non-current Investments accounted for using the equity method Property, plant and equipment Right-of-use asset Intangible assets Deferred tax assets Other financial assets-non-current Other non-current assets Total non-current assets Total assets

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KING YUAN ELECTRONICS CO., LTD. PARENT COMPANY ONLY BALANCE SHEETS As of December 31, 2022 and 2021 (Amounts in thousands of New Taiwan Dollars) English Translation of Financial Statements Originally Issued in Chinese	%	- 1 - 5 - 2 1 - 2 11 33 2 1 1 - 37 48 19 8 5 - 15 20 5 52 100
	December 31, 2021	$10,066 777,667 21,414 3,324,753 119,736 1,235,723 574,809 86,364 882,244 7,032,776 21,275,331 1,527,445 469,377 610,222 33,851 23,916,226 30,949,002 12,227,451 4,885,134 3,019,879 201,416 10,580,312 13,801,607 3,270,083 34,184,275 $65,133,277
	%	- 1 - 5 - 1 1 - 2 10 31 2 1 1 - 35 45 19 7 6 - 20 26 3 55 100
	December 31, 2022	$11,446 446,534 6,215 3,312,528 113,008 695,344 1,082,570 22,581 1,151,448 6,841,674 20,488,747 1,504,657 447,885 657,844 33,090 23,132,223 29,973,897 12,227,451 4,953,859 3,499,434 201,416 13,213,921 16,914,771 1,993,897 36,089,978 $66,063,875
	Notes	7 7 4, 6(20) 4, 6(16) 4, 6(10) 4, 6(11), 8 4, 6(20) 4, 6(16) 4, 6(12) 4, 6(13) 4, 6(7), 6(13) 4, 6(2), 6(13) 4, 6(13)
	LIABILITIES AND EQUITY	Current liabilities Notes payable Accounts payable Accounts payable to related parties Other payables Other payables to related parties Payables on equipment Current tax liabilities Lease liabilities-current Other current liabilities Total current liabilities Non-current liabilities Long-term loans Deferred tax liabilities Lease liabilities-non-current Net defined benefit liabilities Guarantee deposits Total non-current liabilities Total liabilities Equity Share capital Common stock Capital surplus Retained earnings Legal reserve Special reserve Undistributed earnings Total retained earnings Other equity Total equity Total liabilities and equity

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English Translation of Financial Statements Originally Issued in Chinese

KING YUAN ELECTRONICS CO., LTD.

PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME

For the years ended December 31, 2022 and 2021

(Amounts in thousands of New Taiwan Dollars, except for earnings per share)

Description	Notes	2022	%	2021	%
Net sales Operating costs Gross profit Operating expenses Selling expenses Administrative expenses Research and development expenses Total operating expenses Operating income Non-operating income and expenses Interest income Other income Other gains and losses Finance costs Share of profit of associates accounted for using the equity method Total non-operating income and expenses Net income before income tax Income tax expense Net income Other comprehensive income Items that will not be reclassified subsequently to profit or loss: Remeasurements of the defined benefit plan Unrealized gains and losses from equity instrument investments measured at fair value through other comprehensive income Income tax related to components of other comprehensive income that will not be reclassified to profit or loss Items that will be reclassified subsequently to profit or loss: Exchange differences resulting from translating the financial statements of foreign operations Income tax related to components of other comprehensive income that will be reclassified to profit or loss Other comprehensive income, net of tax Total comprehensive income Earnings per share (NT$) Basic Earnings Per Share Diluted Earnings Per Share	4, 6(14), 6(16), 7 4, 6(5), 6(8), 6(9), 6(12), 6(16), 6(17), 7 4, 6(8), 6(9), 6(12), 6(16), 6(17), 7 4, 6(7), 6(8), 6(18), 7 4, 6(20) 4, 6(19) 4, 6(21)	$27,619,107 (18,093,056) 9,526,051 (382,297) (1,680,801) (855,697) (2,918,795) 6,607,256 20,855 249,436 194,251 (348,836) 1,808,991 1,924,697 8,531,953 (1,695,344) 6,836,609 (55,210) (1,752,026) 369,890 132,437 (26,487) (1,331,396) $5,505,213 $5.59 $5.49	100 (66) 34 (1) (6) (3) (10) 24 - 1 - (1) 7 7 31 (6) 25 - (6) 1 - - (5) 20	$25,820,727 (18,476,736) 7,343,991 (345,629) (1,646,203) (846,846) (2,838,678) 4,505,313 4,872 193,414 105,488 (200,484) 1,901,485 2,004,775 6,510,088 (1,335,042) 5,175,046 (53,368) 2,101,279 (419,982) (42,240) 8,448 1,594,137 $6,769,183 $4.23 $4.18	100 (72) 28 (1) (6) (3) (10) 18 - 1 - (1) 7 7 25 (5) 20 - 8 (2) - - 6 26

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

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	Total Equity	$29,319,071 - (2,445,490) - 5,175,046 1,594,137 6,769,183 541,511 - $34,184,275 $34,184,275 - (3,668,235) 6,836,609 (1,331,396) 5,505,213 68,725 $36,089,978	The accompanying notes are an integral part of the parent company only financial statements.
Other equity	Unrealized gains (losses) from equity instrument investments measured at fair value through other comprehensive income	$1,653,489 - - - - 1,681,297 1,681,297 - 326,125 $3,660,911 $3,660,911 - - - (1,382,136) (1,382,136) - $2,278,775
	Exchange differences resulting from translating the financial statements of foreign operations	$(357,036) - - - - (33,792) (33,792) - - $(390,828) $(390,828) - - - 105,950 105,950 - $(284,878)
Retained earnings	Undistributed earnings	$8,147,631 (362,921) (2,200,941) 200,990 5,175,046 (53,368) 5,121,678 - (326,125) $10,580,312 $10,580,312 (479,555) (3,668,235) 6,836,609 (55,210) 6,781,399 - $13,213,921
	Special reserve	$402,406 - - (200,990) - - - - - $201,416 $201,416 - - - - - - $201,416
	Legal reserve	$2,656,958 362,921 - - - - - - - $3,019,879 $3,019,879 479,555 - - - - - $3,499,434
	Capital surplus	$4,588,172 - (244,549) - - - - 541,511 - $4,885,134 $4,885,134 - - - - 68,725 $4,953,859
	Common stock	$12,227,451 - - - - - - - - $12,227,451 $12,227,451 - - - - - - $12,227,451
	Description	Balance as of January 1, 2021 Appropriation and distribution of 2020 earnings : Legal reserve Cash dividends Reversal of special reserve Profit for the year ended December 31, 2021 Other comprehensive income for the year ended December 31, 2021 Total comprehensive income Changes in ownership interests in subsidiaries Disposal of equity instrument investments measured at fair value through other comprehensive income Balance as of December 31, 2021 Balance as of January 1, 2022 Appropriation and distribution of 2021 earnings : Legal reserve Cash dividends Profit for the year ended December 31, 2022 Other comprehensive income for the year ended December 31, 2022 Total comprehensive income Changes in ownership interests in subsidiaries Balance as of December 31, 2022

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English Translation of Financial Statements Originally Issued in Chinese KING YUAN ELECTRONICS CO., LTD. PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS For the years ended December 31, 2022 and 2021 (Amounts in thousands of New Taiwan Dollars)	2021	$1,365 (10,199,072) 786,587 (1,897) (36,338) - 9,697 98,006 (9,341,652) 15,621,188 (12,688,419) 31,096 - (304,763) (2,445,490) (187,708) 25,904 1,309,524 5,110,784 $6,420,308	$1,365 (10,199,072) 786,587 (1,897) (36,338) - 9,697 98,006 (9,341,652) 15,621,188 (12,688,419) 31,096 - (304,763) (2,445,490) (187,708) 25,904 1,309,524 5,110,784 $6,420,308	$1,365 (10,199,072) 786,587 (1,897) (36,338) - 9,697 98,006 (9,341,652) 15,621,188 (12,688,419) 31,096 - (304,763) (2,445,490) (187,708) 25,904 1,309,524 5,110,784 $6,420,308	$1,365 (10,199,072) 786,587 (1,897) (36,338) - 9,697 98,006 (9,341,652) 15,621,188 (12,688,419) 31,096 - (304,763) (2,445,490) (187,708) 25,904 1,309,524 5,110,784 $6,420,308	$1,365 (10,199,072) 786,587 (1,897) (36,338) - 9,697 98,006 (9,341,652) 15,621,188 (12,688,419) 31,096 - (304,763) (2,445,490) (187,708) 25,904 1,309,524 5,110,784 $6,420,308	$1,365 (10,199,072) 786,587 (1,897) (36,338) - 9,697 98,006 (9,341,652) 15,621,188 (12,688,419) 31,096 - (304,763) (2,445,490) (187,708) 25,904 1,309,524 5,110,784 $6,420,308	$1,365 (10,199,072) 786,587 (1,897) (36,338) - 9,697 98,006 (9,341,652) 15,621,188 (12,688,419) 31,096 - (304,763) (2,445,490) (187,708) 25,904 1,309,524 5,110,784 $6,420,308	$1,365 (10,199,072) 786,587 (1,897) (36,338) - 9,697 98,006 (9,341,652) 15,621,188 (12,688,419) 31,096 - (304,763) (2,445,490) (187,708) 25,904 1,309,524 5,110,784 $6,420,308	$1,365 (10,199,072) 786,587 (1,897) (36,338) - 9,697 98,006 (9,341,652) 15,621,188 (12,688,419) 31,096 - (304,763) (2,445,490) (187,708) 25,904 1,309,524 5,110,784 $6,420,308	The accompanying notes are an integral part of the parent company only financial statements.
	2022	$- (6,578,542) 1,406,145 (1) (7,484) (40,490) - 109,278	(5,111,094)	15,785,329 (17,064,745) - (761) (85,762) (3,668,235) (291,680)	(5,325,854)	3,586,439 6,420,308			$10,006,747
	Description	Cash flows from investing activities : Proceeds from disposal of financial assets at fair value through other comprehensive income Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Increase in refundable deposits Acquisition of intangible assets Increase in other financial assets Decrease in other financial assets Dividend received Net cash used in investing activities Cash flows from financing activities : Borrowing in long-term loans Repayments of long-term loans Increase in deposits received Decrease in deposits received Cash payments for the principal portion of the lease liabilities Cash dividends Interest paid Net cash (used in) provided by financing activities Net increase in cash and cash equivalents Cash and cash equivalents at the beginning of the year Cash and cash equivalents at the end of the year
	2021	$6,510,088 7,102,275 47,250 200,484 (4,872) (85,016) (1,901,485) (96,761) 59,461 8,687 24,376 (4,657) (777,035) (331,662) (221,695) 92,839 (255,636) 7,618 (15,035) (11,590) 5,631 (12,727) 1,927 702,439 22,525 303,504 (9,602)					11,361,331	4,700 (740,759)	10,625,272
	2022	$8,531,953 7,103,467 40,899 348,836 (20,855) (96,288) (1,808,991) (75,405) - 476,200 34,886 488 412,883 298,851 (77,407) (36,124) (90,103) (8,456) 11,948 - 1,380 (331,133) (15,199) (53,328) (3,508) 269,204 (7,588)					14,906,610	18,326 (901,549)	14,023,387
	Description	Cash flows from operating activities : Profit before tax from continuing operations Adjustments for: The profit or loss items which did not affect cash flows: Depreciation Amortization Interest expenses Interest income Dividend income Investment gain accounted for using the equity method Gain on disposal of property, plant and equipment Impairment of non-financial assets Unrealized foreign exchange loss Changes in operating assets and liabilities� Contract assets Notes receivable Accounts receivable Accounts receivable from related parties Other receivables Other receivables from related parties Inventories Prepayments Other current assets Contract liabilities Notes payable Accounts payable Accounts payable to related parties Other payables Other payables to related parties Other current liabilities Accrued pension liabilities Cash generated from operating activities Interest received Income tax paid Net cash provided by operating activities

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English Translation of Financial Statements Originally Issued in Chinese KING YUAN ELECTRONICS CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS As of December 31, 2022 and 2021 (Amounts in thousands of New Taiwan Dollars)	%	12 - - 8 3 1 - - 2 - - - 26 10 - 63 1 - - - - 74 100	(continued) The accompanying notes are an integral part of the consolidated financial statements.
	December 31, 2021	$8,649,932 178,880 7,706 5,765,273 2,151,913 326,299 4,825 315 1,371,473 325,437 67,160 3 18,849,216 6,546,477 79,126 45,576,661 677,896 73,599 261,675 105,972 49,561 53,370,967 $72,220,183
	%	17 - - 8 2 1 - - 2 - - - 30 7 - 62 1 - - - - 70 100
	December 31, 2022	$12,816,115 153,753 7,218 5,382,077 1,753,148 408,138 28,582 - 1,368,626 366,144 55,126 4 22,338,931 4,794,451 91,048 45,991,445 651,296 39,235 296,256 146,462 9,859 52,020,052 $74,358,983
	Notes	4, 6(1) 4, 6(16), 6(17), 7 4, 6(3), 6(17) 4, 6(4), 6(17) 4, 6(4), 6(17), 7 4, 7 4, 6(5) 6(6) 8 4, 6(2) 4, 6(7) 4, 6(8), 7, 8 4, 6(18) 4, 6(9) 4, 6(21), 6(22) 8
	ASSETS	Current assets Cash and cash equivalents Contract assets-current Notes receivable, net Accounts receivable, net Accounts receivable from related parties, net Other receivables Other receivables from related parties Current tax assets Inventories, net Prepayments Other current assets Other financial assets-current Total current assets Non-current assets Financial assets at fair value through other comprehensive income-non-current Investments accounted for using the equity method Property, plant and equipment Right-of-use asset Intangible assets Deferred tax assets Other financial assets-non-current Other non-current assets Total non-current assets Total assets

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English Translation of Financial Statements Originally Issued in Chinese KING YUAN ELECTRONICS CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS As of December 31, 2022 and 2021 (Amounts in thousands of New Taiwan Dollars)	%	1 - - 2 - 5 - 3 1 - 3 1 16 32 2 1 - 1 - 36 52 17 7 4 - 15 19 4 47 1 48 100	The accompanying notes are an integral part of the consolidated financial statements.
	December 31, 2021	$566,856 157,024 10,066 1,119,144 21,414 3,731,749 98,930 1,778,300 666,596 92,050 2,017,322 884,648 11,144,099 23,517,245 1,527,445 492,615 16,538 610,222 33,851 26,197,916 37,342,015 12,227,451 4,885,134 3,019,879 201,416 10,580,312 13,801,607 3,270,083 34,184,275 693,893 34,878,168 $72,220,183
	%	1 - - 1 - 5 - 2 2 - 1 2 14 32 2 1 - 1 - 36 50 16 7 5 - 18 23 3 49 1 50 100
	December 31, 2022	$1,023,149 156,639 11,446 1,008,049 6,215 3,738,122 94,707 1,054,070 1,165,435 29,342 805,353 1,151,849 10,244,376 24,464,983 1,504,657 465,796 42,820 657,844 33,090 27,169,190 37,413,566 12,227,451 4,953,859 3,499,434 201,416 13,213,921 16,914,771 1,993,897 36,089,978 855,439 36,945,417 $74,358,983
	Notes	4, 6(10), 9 4, 6(16), 7 7 7 4, 6(22) 4, 6(18) 4, 6(12), 8, 9 6(11) 4, 6(12), 8, 9 4, 6(21), 6(22) 4, 6(18) 4, 6(13) 4, 6(14) 4, 6(14), 6(15), 6(24) 4, 6(2), 6(14) 4, 6(14) 4, 6(14), 6(24)
	LIABILITIES AND EQUITY	Current liabilities Short-term loans Contract liabilities-current Notes payable Accounts payable Accounts payable to related parties Other payables Other payables to related parties Payables on equipment Current tax liabilities Lease liabilities-current Current portion of long-term loans Other current liabilities Total current liabilities Non-current liabilities Long-term loans Deferred tax liabilities Lease liabilities-non-current Long-term deferred income Net defined benefit liabilities Guarantee deposits Total non-current liabilities Total liabilities Equity attributable to owners of the parent company Share capital Common stock Capital surplus Retained earnings Legal reserve Special reserve Undistributed earnings Total retained earnings Other equity Equity attributable to owners of the parent company Non-controlling interests Total equity Total liabilities and equity

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English Translation of Financial Statements Originally Issued in Chinese KING YUAN ELECTRONICS CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the years ended December 31, 2022 and 2021

(Amounts in thousands of New Taiwan Dollars, except for earnings per share)

Description	Notes	2022	%	2021	%
Net sales Operating costs Gross profit Operating expenses Selling expenses Administrative expenses Research and development expenses Expected credit losses Total operating expenses Operating income Non-operating income and expenses Interest income Other income Other gains and losses Finance costs Share of profit of associates accounted for using the equity method Total non-operating income and expenses Net income before income tax Income tax expense Net income Other comprehensive income Items that will not be reclassified subsequently to profit or loss: Remeasurements of the defined benefit plan Unrealized gains from equity instrument investments measured at fair value through other comprehensive income Income tax related to components of other comprehensive income that will not be reclassified to profit or loss Items that will be reclassified subsequently to profit or loss: Exchange differences resulting from translating the financial statements of foreign operations Income tax related to components of other comprehensive income that will be reclassified to profit or loss Other comprehensive income, net of tax Total comprehensive income Net income attributable to : Owners of the parent company Non-controlling interests Total comprehensive income attributable to : Owners of the parent company Non-controlling interests Earnings per share (NT$) Basic Earnings Per Share Diluted Earnings Per Share	4, 6(16), 6(18), 7 4, 6(5), 6(8), 6(9), 6(13), 6(18), 6(19), 7 4, 6(8), 6(9), 6(13), 6(17), 6(18), 6(19), 7 4, 6(2), 6(7), 6(8), 6(20), 7 4, 6(22) 4, 6(13), 6(21) 4, 6(23)	$36,781,996 (23,709,003) 13,072,993 (377,820) (2,259,835) (1,267,045) (3,463) (3,908,163) 9,164,830 53,940 345,106 (67,736) (555,026) 24,912 (198,804) 8,966,026 (1,983,936) 6,982,090 (55,210) (1,752,026) 369,890 142,897 (26,487) (1,320,936) $5,661,154 $6,836,609 145,481 $6,982,090 $5,505,213 155,941 $5,661,154 5.59 5.49	100 (64) 36 (1) (6) (4) - (11) 25 - 1 - (2) - (1) 24 (5) 19 - (5) 1 - - (4) 15 19 - 19 15 - 15	$33,759,389 (23,407,322) 10,352,067 (363,529) (2,178,521) (1,202,856) (645) (3,745,551) 6,606,516 22,692 320,231 227,074 (343,526) 22,260 248,731 6,855,247 (1,621,005) 5,234,242 (53,368) 2,101,279 (419,982) (41,254) 8,448 1,595,123 $6,829,365 $5,175,046 59,196 $5,234,242 $6,769,183 60,182 $6,829,365 $4.23 $4.18	100 (69) 31 (1) (6) (4) - (11) 20 - 1 - (1) - - 20 (5) 15 - 6 (1) - - 5 20 15 - 15 20 - 20

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

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English Translation of Financial Statements Originally Issued in Chinese KING YUAN ELECTRONICS CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY For the years ended December 31, 2022 and 2021 (Amounts in thousands of New Taiwan Dollars)			Total Equity	$29,326,076 - (2,445,490) - 5,234,242 1,595,123	6,829,365	1,168,217 -	$34,878,168	$34,878,168 - (3,668,235) 6,982,090 (1,320,936)	5,661,154	74,330	$36,945,417		The accompanying notes are an integral part of the consolidated financial statements.
			Non-controlling interests	$7,005 - - - 59,196 986	60,182	626,706 -	$693,893	$693,893 - - 145,481 10,460	155,941	5,605	$855,439
	Equity attributable to owners of the parent company		Equity attributable to owners of the parent company	$29,319,071 - (2,445,490) - 5,175,046 1,594,137	6,769,183	541,511 -	$34,184,275	$34,184,275 - (3,668,235) 6,836,609 (1,331,396)	5,505,213	68,725	$36,089,978
		Other equity	Unrealized gains (losses) from equity instrument investments measured at fair value through other comprehensive income	$1,653,489 - - - - 1,681,297	1,681,297	- 326,125	$3,660,911	$3,660,911 - - - (1,382,136)	(1,382,136)	-	$2,278,775
			Exchange differences resulting from translating the financial statements of foreign operations	$(357,036) - - - - (33,792)	(33,792)	- -	$(390,828)	$(390,828) - - - 105,950	105,950	-	$(284,878)
		Retained earnings	Undistributed earnings	$8,147,631 (362,921) (2,200,941) 200,990 5,175,046 (53,368)	5,121,678	- (326,125)	$10,580,312	$10,580,312 (479,555) (3,668,235) 6,836,609 (55,210)	6,781,399	-	$13,213,921
			Special reserve	$402,406 - - (200,990) - -	-	- -	$201,416	$201,416 - - - -	-	-	$201,416
			Legal reserve	$2,656,958 362,921 - - - -	-	- -	$3,019,879	$3,019,879 479,555 - - -	-	-	$3,499,434
			Capital surplus	$4,588,172 - (244,549) - - -	-	541,511 -	$4,885,134	$4,885,134 - - - -	-	68,725	$4,953,859
			Common stock	$12,227,451 - - - - -	-	- -	$12,227,451	$12,227,451 - - - -	-	-	$12,227,451
			Description	Balance as of January 1, 2021 Appropriation and distribution of 2020 earnings: Legal reserve Cash dividends Reversal of special reserve Profit for the year ended December 31, 2021 Other comprehensive income for the year ended December 31, 2021 Total comprehensive income Changes in ownership interests in subsidiaries Disposal of equity instrument investments measured at fair value through other comprehensive income Balance as of December 31, 2021 Balance as of January 1, 2022 Appropriation and distribution of 2021 earnings: Legal reserve Cash dividends Profit for the year ended December 31, 2022 Other comprehensive income for the year ended December 31, 2022 Total comprehensive income Changes in ownership interests in subsidiaries Balance as of December 31, 2022

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English Translation of Financial Statements Originally Issued in Chinese KING YUAN ELECTRONICS CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS For the years ended December 31, 2022 and 2021 (Amounts in thousands of New Taiwan Dollars)	2021	$1,365 (13,963,127) 341,578 32,109 (36,793) - - 9,698 98,006 (13,517,164) 598,369 (131,812) 16,299,865 (14,433,360) 31,096 - (310,374) (2,445,490) (329,548) 1,147,767 426,513 8,999 641,402 8,008,530 $8,649,932	The accompanying notes are an integral part of the consolidated financial statements.
	2022	$- (10,391,637) 398,363 39,748 (8,875) (76,557) (40,491) - 109,278 (9,970,171) 1,597,599 (1,149,115) 20,058,327 (21,094,189) - (761) (91,698) (3,668,235) (501,253) - (4,849,325) (44,753) 4,166,183 8,649,932 $12,816,115
	Description	Cash flows from investing activities : Proceeds from disposal of financial assets at fair value through other comprehensive income Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Decrease in refundable deposits Acquisition of intangible assets Acquisition of right-of-use assets Increase in other financial assets Decrease in other financial assets Dividend received Net cash used in investing activities Cash flows from financing activities : Increase in short-term loans Decrease in short-term loans Borrowing in long-term loans Repayments of long-term loans Increase in deposits received Decrease in deposits received Cash payments for the principal portion of the lease liabilities Cash dividends Interest paid Change in non-controlling interests Net cash (used in) provided by financing activities Effect of changes in exchange rate on cash and cash equivalents Net increase in cash and cash equivalents Cash and cash equivalents at the beginning of the year Cash and cash equivalents at the end of the year
	2021	$6,855,247 9,162,765 49,593 645 343,526 (22,692) (85,016) 20,452 (22,260) (164,810) 59,461 (164,411) 24,092 (4,657) (1,600,926) (426,962) (228,799) 22,977 (390,504) 149,415 (15,317) (72,579) 5,631 1,189 1,927 820,074 18,225 303,792 (9,602) 16,538 14,647,014 24,861 (948,821) 13,723,054
	2022	$8,966,026 9,178,388 43,316 3,463 555,026 (53,940) (96,288) 74,414 (24,912) (58,161) - 755,197 25,127 488 379,969 398,765 (72,175) (22,491) 2,847 (19,702) 12,034 (385) 1,380 (111,095) (15,199) (22,052) (1,984) 267,201 (7,588) 26,282 20,183,951 45,229 (1,198,748) 19,030,432
	Description	Cash flows from operating activities : Profit before tax from continuing operations Adjustments for : The profit or loss items which did not affect cash flows: Depreciation Amortization Expected credit losses Interest expenses Interest income Dividend income Share-based payment expenses Investment gain accounted for using the equity method Gain on disposal of property, plant and equipment Impairment of non-financial assets Unrealized foreign exchange loss (gain) Changes in operating assets and liabilities : Contract assets Notes receivable Accounts receivable Accounts receivable from related parties Other receivables Other receivables from related parties Inventories Prepayments Other current assets Contract liabilities Notes payable Accounts payable Accounts payable to related parties Other payables Other payables to related parties Other current liabilities Accrued pension liabilities Other operating liabilities Cash generated from operating activities Interest received Income tax paid Net cash provided by operating activities

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(Annex 6)

King Yuan Electronics Co., Ltd.

2023 Annual General Meeting

List of candidates of directors (including independent directors)

No.	Type of Candidate	Name of Candidate	Education	Experience	Current Position	Shares held (Share)
1	Director	Chin-Kung Lee	Graduated from Department of Shipping and Transportation Management, National Taiwan Ocean University	President of KYEC	Chairman and CEO of KYEC Director of King Long Technology (Suzhou) Ltd. and Suzhou Zhen Kun Technology Ltd. Independent Director of Quang Viet Enterprise Co., Ltd.	34,100,941
2	Director	Chi-Chun Hsieh	Graduated from College of Medicine, Taipei Medical University	Supervisor of KYEC	Vice-Chairman of KYEC Physician	5,552,037
3	Director	An-Hsuan Liu	PhD in Mechanical Engineering, North Carolina State University	President of Intematix Technology Center Corporation	President and Director of KYEC Chairman of King Long Technology (Suzhou) Ltd. and Suzhou Zhen Kun Technology Ltd.	1,250,000
4	Director	Kao-Yu Liu	PhD in Architecture, Graduate School of Engineering, the University of Tokyo	Supervisor of KYEC	Director of KYEC Chairman of LC Architecture Realization Company, Inc. Chairman of Ji-Ze Construction Development Co., Ltd.	4,808,267
5	Director	Kuan-Hua Chen	Master’s in Financial Engineering, Carnegie Mellon University	Supervisor of Weikeng Industrial Co., Ltd.	Director of KYEC Director of Weikeng Industrial Co., Ltd.	3,168,574
6	Director	Yann Yuan Investment Co., Ltd. Representative: Ping-Kun Hung	Not applicable.	Not applicable.	Not applicable.	52,600,000
			Graduated from Department of Public Finance, National Chengchi University	Chairman of Hsun Chieh Investment Co.,Ltd. CFO of KYEC	Director of KYEC Director of Silicon Integrated Systems Corp.	0
7	Independent director	Shi-Jer Sheen	Graduated from Institute of Business Administration, Kyushu University, Japan	Independent Director of KYEC	Responsible person of Private Short-Term Busiban	0
8	Independent director	Dar-Yeh Hwang	PhD in Financial, New York University,ABD completed Master in Business Administration	Chair and Director of The Department of Finance, National Taiwan University	Independent Director of KYEC, Member of Audit Committee and Remuneration Committee Chairman of McBorter AFMA Chairman of Academy of Promoting Economic Legislation (APEL) Co-director of ZIBS China Banking Research Center, Zhejiang University	0

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			and PhD in Finance,Rutgers University Graduated from Peking University, Ph.D.	Independent director of DBS (Taiwan) Independent Director of Chailease Holding Distinguished Professor of International College of Renmin University of China (Suzhou Campus)
9	Independent director	Semi Wang	Graduated from Department of Aeronautics and Astronautics, NCKU	Chairman of Mingxiang Culture Co., Ltd. Director of Cheng Uei Precision Industry Co., Ltd. Supervisor of Glory Science Co., Ltd. Supervisor of Kuokuang Power Plant Co.,Ltd.	Independent Director of KYEC, Member of Audit Committee and Remuneration Committee Member of Homenema Technology Incorporation Compensation Committee Director of Mingxing Creative Management Consulting Co., Ltd. Independent Director of Creative Sensor Inc. Director of FIT Holding Co., Ltd.	10,000

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(Appendix 1)

King Yuan Electronics Co., Ltd.

Rules of Procedure for Shareholders’ Meetings

• Article 1 The rules of procedures for the Company’s shareholders’ meeting shall be as provided in these Rules.

• Article 2 Shareholders (or representatives) shall wear an attendance card when attending the meeting and submit a signature card as proof of attendance. The number of shares is calculated based on the number of shares shown on the signed card.

• Article 3 The Chair calls for the meeting to begin when the total number of shares represented reaches the authorized amount. If the authorized amount is not reached at the meeting time, the Chair may postpone the meeting twice (first postponement: 20 minutes; second postponement: 10 minutes). If the number of shareholders present does not constitute the quorum, but those present represent one-third or more of the total number of issued shares, a tentative resolution may be passed by a majority of those present in accordance with Article 175 of the Company Act. Prior to conducting a tentative resolution of the preceding paragraph, if the total number of shares of the shareholders present reaches the authorized amount, the meeting will officially be called to start, and the tentative resolution will be submitted to the meeting.

• Article 4 A shareholder wishing to speak in a shareholders’ meeting shall first fill out a slip, specifying number of attendance and his/her name, and the Chair shall determine his/her order of giving a speech.

• Article 5 Shareholders’ meetings shall be conducted according to the procedures stipulated in the agenda and its agenda shall be formulated based on the following:

• Annual General Meeting: formulated by the board of directors.

• Special shareholders’ meetings: formulated by the convener.

The Chair shall not adjourn a meeting without resolution adopted by shareholders if the motions (including extraordinary motions) covered in the proceedings so arranged in the above two paragraphs have not been resolved. After the close of the said meeting, shareholders shall not elect another Chair to hold another meeting at the same place or at any other place.

• Article 6 A shareholder shall not speak more than two times in one motion, unless he/she has obtained the prior consent from the Chair, and each speech shall not exceed 5 minutes. A corporate shareholder being entrusted to attend a shareholders’ meeting may designate only one representative to represent it in the meeting. If a corporate shareholder designates two or more representatives to represent it at the shareholders’

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meeting, only one of the representatives may speak on any one motion.

• Article 7 Except for the motions included in the agenda, other motions such as the motion of amendments or motions of alternatives proposed by shareholders shall be agreed upon by other shareholders, and the number of shares held by the shareholders who propose the motion, along with a representative among those who agree, shall reach 1 percent of the total number of issued common stocks.

• Article 8 If not a motion, it will not be discussed or resolved. When discussing a motion, it shall be discussed according to orders in the agenda. If a violation of procedures is found or the topic is not within the motion, the Chair may immediately stop the speaker. The Chair may announce the end of discussion at an appropriate time, and if necessary, may end the discussion.

• Article 9 For the discussion topics that have been terminated or stopped, the Chair shall immediately submit a voting. The voting rights of each shareholder shall be calculated in accordance with the Company’s Articles of Incorporation.

• Article 10 Unless otherwise specifically provided for in the Company Act, resolutions shall be adopted by a majority vote at a meeting attended by the shareholders. Those who express no objection when the Chair requires will be deemed to be approved, which serves the same effect as voting. Where there are any objections, the Chair may use a roll-call against the resolution which will be calculated based on the number of shares held by the shareholders who have expressed an objection or waived his/her voting power. After the calculation, if the number of shares does not impact the approval of the motion, the motion is deemed to have passed, which serves the same effect as voting.

• Article 11 Where a representative is appointed by the shareholder to attend the shareholders’ meeting, except for trust enterprises or stock agencies approved by the competent authority, when a person who acts as the proxy for two or more shareholders, the number of voting power represented by him/her shall not exceed 3 percent of the total number of voting shares of the company; otherwise, the portion of excessive voting power shall not be counted.

• Article 12 As the meeting is being processed, the Chair may announce a break at his/her discretion.

• Article 13 Matters for which these Rules make no provision shall be handled in accordance with the Articles of Incorporation, Company Act, and other applicable laws and regulations.

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

• Article 15 These Rules were established on August 20, 1997.

• First amended on May 7, 2002.

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(Appendix 2)

King Yuan Electronics Co., Ltd. Rules Governing the Election of Directors

• Article 1 Unless elsewhere regulated by law or the articles of incorporation, election of the company's directors shall be governed by these Rules.

• Article 2 The candidate nomination system and cumulative voting method shall be adopted for election of the Company’s directors. Each share shall have voting rights in number equal to the directors to be elected, and may be cast for a single candidate or split among multiple candidates.

• Article 3 The company shall, prior to the share transfer suspension date dedicated before the meeting date of a shareholders’ meeting, announce in a public notice, the period for accepting the nomination of director candidates, the quota of directors to be elected, the place designated for accepting the roster of director candidates nominated, and other necessary matters.

• The Company’s Board of Directors and any shareholder holding 1% or more of the total number of outstanding shares issued by the company may submit a roster of director candidates for the next term of Board of Directors in accordance with the Company Act and other applicable laws and regulations.

• The qualification of director candidates of the Company shall follow applicable laws and regulations.

• Article 4 The directors of the Company shall be elected during a shareholders’ meeting from among the nominees listed in the roster of director candidates. Those receiving ballots representing the highest numbers of voting rights will be elected sequentially as independent or non-independent director according to the number of directors to be elected as specified in the Articles of Incorporation and relevant announcements and the ballot count results. When two or more persons receive the same number of votes, thus exceeding the specified number of positions, they shall draw lots to determine the winner, with the chair drawing lots on behalf of any person not in attendance.

• Article 5 When preparing the ballots, the Company shall specify the attendance card numbers and the number of voting rights associated with each ballot.

• The directors shall be elected at the same time as the election of independent and non-independent directors, but the ballots shall be counted separately.

• Article 6 Before the election begins, the chair shall appoint a number of persons to perform the respective duties of vote monitoring and counting.

• Article 7 When a candidate is a shareholder, the name on the account and account number of the candidate must be indicated on the ballot. When the candidate is not a shareholder, the ID

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number and name of the candidate shall be indicated on the ballot. Where the candidate is a government agency or a juristic person and there is more than one representative, the name of the government agency or juristic person and name of all the representatives shall be listed separately on the ballot.

The shareholder may replace with a seal the candidate name (account name), account number, and National ID number provided on the ballot as prescribed in paragraph 1.

• Article 8 The ballot boxes shall be prepared by the company and shall be publicly checked by the vote monitoring personnel before voting commences.

After voting, the ballot box shall be opened by the vote monitoring personnel, and the vote counting process shall be monitored by the vote monitoring personnel.

Article 9 A ballot is invalid under any of the following circumstances:

1. The ballot was not prepared as stipulated in Article 5.

2. The number of candidates filled in the ballot exceeds the number of seats to be elected as stipulated in Article 4.

3. The total votes cast by the voter exceeds the total voting rights of that voter.

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

5. The writing is unclear and indecipherable or has been altered.

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

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

8. A blank ballot is placed in the ballot box.

9. Article 10 The vote monitoring personnel shall verify the validity of any ballot in question. Invalid ballots shall be indicated as invalid and affixed with a signature or seal at the end of the vote counting.

10. Article 11 Vote monitoring personnel shall check the sum of valid and invalid ballots upon completion of voting and then document the valid votes and number of voting rights. The results of the calculation shall be announced on site.

11. The election of the director shall be deemed invalid it does not conform to Article 26-3, paragraph 3 of the Securities and Exchange Act.

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• Article 12 The persons elected as directors shall personally sign the form “Consent to Act as Director” to facilitate company registration with the competent authority.

• Article 13 All matters not covered by these Rules shall be subject to applicable laws and regulations.

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

• Article 15 These Rules were established on August 20, 1997.

• First amendment was made on April 20, 1999.

• Second amendment was made on May 7, 2002.

• Third amendment was made on June 13, 2007.

• Fourth amendment was made on June 12, 2014.

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(Appendix 3)

King Yuan Electronics Co., Ltd. The Articles of Incorporation

Chapter 1. General Rules

• Article 1 The Company is organized by regulations of the Company Act and named King Yuan Electronics Co., Ltd. (KYEC)

Article 2 The Company’s business matters shall include:

• I. Designing, manufacturing, testing, accessories, processing, packaging, trading of various integrated circuits (IC).

• II. Different types of burn in equipment, and manufacturing, processing, and trading of its components.

III. As well as import/export trade of said products.

• IV.We also act as an agent for the quotation, bidding and distribution of different products for Taiwanese and foreign manufacturers.

• V. ZZ99999 All business items that are not prohibited or restricted by law, except those that are subject to special approval.

• Article 2-1 When the Company becomes a shareholder of limited liability in other companies, the total amount of its investments is not subject to Article 13 of the Company Act which states that the total amount of its investments in such other companies shall not exceed forty percent of the amount of its own paid-up capital.

• Article 2-2 The Company may provide guarantees to the external for business needs.

• Article 3 The Company shall have its head office in Hsinchu City, and when it is determined to be necessary, upon the resolution of the board of directors, branch offices may be established domestically or overseas.

Article 4 Deleted.

Chapter 2. Shares

• Article 5 The total capital of the Company shall be NT$15 billion, divided into 1.5 billion shares (including 30 million shares for employee stock option certificates) at a par value of NT$10 per share, and issued at discrete times. The board of directors has been authorized to issue the shares in installment according to business needs.

• Article 5-1 Where the price of employee stock option certificates of the Company is lower than the Company’s common share price closed on the date of issuance, the issuance of such employee stock option certificates shall only be made with the consents of attending shareholders representing more than two-thirds of the total voting rights in a shareholders’ meeting attended by shareholders representing a majority of the total

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issued shares.

To transfer shares to employees at less than the average actual share repurchase price, the Company must have obtained the consent of at least two-thirds of the voting rights present at the most recent shareholders’ meeting attended by shareholders representing a majority of total issued shares before the transfer of shares.

• Article 6 Deleted.

• Article 7 The share certificates of the Company shall be in registered form and shall be numbered, and shall be affixed with the signatures or personal seals of the director representing the company, and shall be duly certified or authenticated by the bank which is competent to certify shares under the laws before issuance thereof.

• The shares issued by the Company are exempted from printing any share certificate for the shares issued and shall register the issued shares with a centralized securities depository enterprise.

• Article 8 Any change and transfer registration of shares shall be prohibited within sixty days prior to the ordinary shareholders’ meeting, thirty days prior to the extraordinary shareholders’ meeting, or five days prior to the record date for the distribution of dividends and bonuses or other interests by the Company.

  • Chapter 3. Shareholders meeting

• Article 9 The shareholders’ meeting is classified into two types of the ordinary shareholders’ meeting and the extraordinary shareholders’ meeting. The ordinary shareholders’ meeting shall be convened once per year, and shall be convened by the board of directors according to the laws within six months after the close of each fiscal year. The extraordinary shareholders’ meeting shall be convened whenever necessary according to laws.

• Article 10 Where a shareholder for any reasons cannot attend the shareholders’ meeting in person, he/she/it may appoint a proxy to attend a shareholders’ meeting on his/her/its behalf by executing a power of attorney printed by the Company stating therein the scope of power authorized to the proxy.

• Article 11 The Company’s shareholders shall have one vote for each share, except for where the shares have no voting rights under Article 179 of the Company Act and the directors’ pledges under Article 197-1, Paragraph 2 of the Company Act.

• Article 12 Unless otherwise specified in the Company Act, any resolution at a shareholders’ meeting shall be adopted by a majority of the shareholders present, who are representing more than half of the total number of the Company’s outstanding shares, and shall be executed based on the majority of the voting rights of attending shareholders.

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• Article 12-1 The agenda of the Company’s shareholders’ meetings, except as otherwise provided by law, regulation, or the Articles of Incorporation, shall be as provided in the Rules of Procedures for Shareholders’ Meetings of the Company.

  • Chapter 4. Directors and Audit Committee

• Article 13 The Committee shall be composed of the entire number of 7 to 11 directors and shall serve a 3-year term. The candidate nomination system is adopted and directors shall be selected from a candidate list by the shareholders’ meeting and may be reelected to further terms. The Company shall take out liability insurance for the directors with respect to liabilities resulting from the performance of duties during their terms of office.

• Among the number of directors of the preceding paragraph, there shall be at least 3 independent directors, and not less than one-fifth of the seats shall be held by directors. Regulations governing the professional qualifications, restrictions on shareholdings and concurrent positions held, assessment of independence, method of nomination, and other matters for compliance with respect to independent directors shall be in compliance with the relevant regulations set out by the securities competent authorities.

• Article 13-1 The Company shall establish an audit committee pursuant to Article 14-4 of the Securities and Exchange Act. The audit committee shall be composed of the entire number of independent directors.

• The Audit Committee’s members, term of office, powers and authorities, rules of procedure, and resources provided by the company to facilitate its exercise of powers shall be in accordance with the regulations stipulated in the Audit Committee Charter.

• Article 14 The board of directors shall be formed by directors. A Chairman shall be elected among the directors during a board meeting attended by more than two-thirds of directors and with the consents of more than half of all attending directors. In addition, a Vice-Chairman may be elected from among the directors through the same method described above. The Chairman of the board of directors shall internally preside the shareholders’ meeting and the meeting of the board of directors, and shall externally represent the Company.

• Article 15 In case where the Chairman is on leave or absent or cannot exercise his power and authority for any cause, the proxy thereof shall be handled according to the regulation of Article 208 of the Company Act.

• Article 15-1 Directors shall attend board meetings in person. A director unable to attend in person may appoint another director to attend the meeting by presenting a power or attorney in order to act as a proxy for attending the meeting on his/her/its behalf. The proxy

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described in the preceding paragraph shall be limited to accept the appointment of one director only.

Article 15-2 The authorities of the board of directors are as follows:

• 1.Review of management policies and mid- to long-term development plans.

• 2.Review and ensure implementation of annual business plans. 3.Review of budget and final accounts.

• 4.Review plans of capital increase or decrease.

• 5.Review proposals of earnings distribution or making up loss.

• 6.Review of important external contracts.

• 7.Review of articles of incorporation or make amendments.

• 8.Review of the Company’s organizational rules and important business rules.

• 9.Agreement on establishment, reorganization or cancellation of branches.

• Review of major capital expenditure plans.

• Appointment and discharge of managerial offers.

• Implementation of the resolution by shareholders’ meetings.

• Review of matters proposed by managers.

• Convention of shareholders’ meeting and business report.

• Other operations that shall be handled in compliance with the law.

• Article 16 For the remuneration of all directors, the board of directors is authorized to reach a resolution on such remuneration based on their participation level and value of contribution to the operation of the Company along with the consideration of the common standard adopted in the same industry.

  • Chapter 5. Managers

• Article 17 The Company may appoint managers. The appointment, discharge and remuneration of the managerial officers shall comply with the provision of Article 29 of the Company Act and relevant laws and regulations.

  • Chapter 6. Accounting

• Article 18 At the end of each fiscal year of the Company, the board of directors shall prepare the reports and statements of 1. Business report, 2. Financial statements and 3. Proposal for distribution of surplus earnings or covering losses, for submission to the ordinary shareholder’s meeting according to the law in order to request approval thereof.

• Article 19 Where there is a profit in the current year, the Company shall allocate 8–10 percent of the profit as the remuneration to employees, and no more than 1 percent thereof as directors’ remuneration. However, if the Company has cumulative losses, an amount sufficient to make up losses shall be retained.

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Employees’ compensation is distributed in the form of shares or in cash. Those entitled for shares or cash, must be the Company’s employees.

“Profit sought for the current year” as referred in the first paragraph means current pre-tax benefit deducts the benefits before the distribution of compensation of employees and directors compensation.

The Company may, by a resolution adopted by a majority vote at a meeting of board of directors attended by two-thirds of the total number of directors, have the profit distributable as employees’ compensation and directors’ compensation, and in addition thereto, a report of such distribution shall be submitted to the shareholders’ meeting.

Article 20 If the Company's final statement for the year shows earnings, funds shall first be set aside for tax payments and to make up past losses, and another 10% shall be then be set aside as a statutory reserve; Furthermore, depending on the Company's operating needs and the requirements of laws and regulations, the Company may set aside or reverse a special reserve; if their are still earnings and undistributed earnings at the beginning of the period, the board may draft a proposed earnings distribution plan, which shall be presented to the shareholders meeting for resolution.

The Company's dividends distribution policy shall be determined on the basis of the Company's current and future investment environment, need for funds, state of domestic and foreign competition, and funds need budget, etc., and should also reflect shareholders' interests and strike a balance between dividends and the Company's long-term financial plans. In accordance with law, the Board shall draft an annual distribution plan, which shall be reported to the shareholders meeting. Since the industry in which the Company is situated is currently at the growth stage, and the Company expects to have future expansion plans and funding needs, with regard to the distribution of shareholders' dividends for the year, cash dividends shall comprise no less than 20% of all shareholders' dividends.

Chapter 7. Supplemental Provisions

Article 21 Any matter not specified in these Articles of Incorporation of the Company shall be handled in accordance with the regulations of the Company Act.

• Article 21-1 The Company’s various rules and procedures shall be further established separately. Article 22 These Rules were established on May 2, 1987

• 1st amendment was made on May 20, 1987

• 2nd amendment was made on November 22, 1988

• 3rd amendment was made on December 12, 1988

• 4th amendment was made on February 5, 1990

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5th amendment was made on May 3, 1990 6th amendment was made on June 7, 1992 7th amendment was made on April 28, 1994 8th amendment was made on December 28, 1994 9th amendment was made on July 21, 1995 10th amendment was made on September 13, 1995 11th amendment was made on August 2, 1996 12th amendment was made on September 25, 1996 13th amendment was made on March 14, 1997 14th amendment was made on August 20, 1997 15th amendment was made on April 30, 1998 16th amendment was made on April 20, 1999 17th amendment was made on April 10, 2000 18th amendment was made on March 12, 2001 19th amendment was made on May 7, 2002 20th amendment was made on December 19, 2002 21st amendment was made on June 9, 2003 22nd amendment was made on June 1, 2004 23rd amendment was made on June 1, 2004 24th amendment was made on June 13, 2005 25th amendment was made on June 13, 2005 26th amendment was made on June 12, 2006 27th amendment was made on June 12, 2006 28th amendment was made on June 13, 2007 29th amendment was made on June 13, 2008 30th amendment was made on June 10, 2009 31st amendment was made on June 15, 2010 32nd amendment was made on June 15, 2011 33rd amendment was made on June 15, 2012 34th amendment was made on June 12, 2014 35th amendment was made on June 8, 2016 36th amendment was made on August 3, 2021

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(Appendix 4)

King Yuan Electronics Co., Ltd.

Rules and Procedures for Board of Directors Meetings

Amended on March 13, 2020

• Article 1 These Rules and Procedures are adopted pursuant to Article 26-3, paragraph 8, of the Securities and Exchange Act and the Regulations Governing Procedure for Board of Directors Meetings of Public Companies.

• Article 2 The rules and procedures for the meetings of the Company’s Board of Directors, except as otherwise provided by law, regulation, or the articles of incorporation, shall be handled in accordance with these Rules.

• Article 3 The Board of Directors of the Company shall meet at least quarterly.

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

• The notice to be given under the preceding paragraph may be effected by means of electronic transmission, after obtaining prior consent from the recipients thereof.

• Except in cases of emergency or under circumstances supported by justifiable reasons, all matters set out in the subparagraphs of Article 7, paragraph 1, shall be specified in the notice of the reasons for calling a board of directors meeting; none of them may be raised by an extraordinary motion.

• Article 4 A board meeting shall be held at the premises and during the business hours of the Company, or at a place and time convenient for all directors to attend and suitable for holding board meetings.

• Article 5 The Department of Finance has been designated by the Company’s Board of Directors as the administrator of all board meeting affairs.

The unit responsible for board meetings shall draft agenda items and prepare sufficient meeting materials, and shall deliver them together with the notice of the meeting. Directors may request for supplemental information from the administrator of all board meeting affairs should they consider the existing information to be insufficient. Directors may resolve to postpone certain agendas if they consider the information presented to them to be inadequate.

Article 6 The following agendas shall be covered as the minimum during regular board meetings:

• I. Reporting Items:

• (I) Minutes of the last meeting and action taken.

• (II) Reporting on important financial and business matters.

• (III) Internal auditing operations.

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• (IV) Reports on other important issues.

• II. Discussion Items:

• (I) Matters for continued discussion from the last meeting.

• (II) Items scheduled for discussion at this meeting.

• III. Extraordinary Motions.

Article 7 The following items shall be raised for discussion in the Company’s board meetings:

• I. The Company’s business plan.

• II. Matters required by Paragraph 4 of this Article.

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

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

The term “related party” in subparagraph 3 of the preceding paragraph means a related party as defined in the Regulations Governing the Preparation of Financial Reports by Securities Issuers. The term “major donation to a non-related party” means any individual donation, or cumulative donations within a 1-year period to a single recipient, at an amount of NTD100 million or more, or at an amount equal to or greater than 1% of net operating revenue or 5% of paid-in capital as stated in the CPA-attested financial report for the most recent year.

The term “within a 1-year period” in the preceding paragraph means a period of 1 year calculated retroactively from the date on which the current board of directors meeting is convened. Amounts already submitted to and passed by a resolution of the board are exempted from inclusion in the calculation.

The following items shall be approved by at least one half of the Audit Committee members and submitted to the Board of Directors for resolution:

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

• II. Assessment of the effectiveness of the internal control system.

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

• IV. Matters bearing on the personal interest of a director.

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• V. Asset transactions or derivatives trading of a material nature.

• VI. Loans of funds, endorsements, or provision of guarantees of a material nature.

• VII. Offering, issuance, or private placement of equity-type securities.

• VIII. Appointment, dismissal of, or remuneration of certified public accountants.

• IX. Appointment or discharge of a financial, accounting, or internal audit officer.

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

• XI. Other material matters as may be required by the Company or by the competent authority.

With the exception of subparagraph 10, any matter under a subparagraph of the preceding paragraph that has not been approved with the consent of one-half or more of all audit committee members may be undertaken upon the consent of two-thirds or more of all directors, without regard to the restrictions of the preceding paragraph, and the resolution of the audit committee shall be recorded in the minutes of the directors meeting.

“All audit committee members” as used in paragraph 4 and “all directors” as used in the preceding paragraph, shall mean the actual number of persons currently holding those positions.

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

• Article 8 Apart from matters referred to in paragraph 1 of Article 7, which are required to be submitted for discussion by the board of directors, when the board of directors delegates any exercise of its powers pursuant to laws or regulations or the company’s articles of incorporation, matters such as the level and substance of the delegation shall be concretely and specifically set out.

• Article 9 When a meeting of the board of directors is held, an attendance book shall be made ready for signature by directors attending the meeting.

All board directors shall attend board meetings in person; if attendance in person is not

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possible, they may, pursuant to the company's articles of incorporation, appoint another director to attend as their proxy. Attendance via tele- or video-conference is deemed as attendance in person.

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

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

Article 10 Where a meeting of the board of directors is called by the chairperson of the board, the meeting shall be chaired by the chairperson. However, where the first meeting of each newly elected board of directors is called by the director who received votes representing the largest portion of voting rights at the shareholders’ meeting in which the directors were elected, the meeting shall be chaired by that director; if there are two or more directors so entitled to call the meeting, they shall choose one person by and from among themselves to chair the meeting.

Where a meeting of the board of directors is called by a majority of directors on their own initiative in accordance with Article 203, paragraph 4 or Article 203-1, paragraph 3 of the Company Act, the directors shall choose one person by and from among themselves to chair the meeting.

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

Article 11 When holding a meeting of the board of directors, the Company may, as necessary for the agenda items of the meeting, notify personnel of relevant departments or subsidiaries to attend the meeting as nonvoting participants.

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

Article 12 The chair shall call the board meeting to order at the appointed meeting time and when more than one-half of all the directors are in attendance.

If one-half of all the directors are not in attendance at the appointed meeting time, the chair may announce postponement of the meeting time, provided that no more than two such postponements may be made. If the quorum is still not met after two postponements, the chair shall reconvene the meeting in accordance with the procedures in Article 3,

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paragraph 2.

The term “all directors” as used in the preceding paragraph and in Article 17, paragraph 2, subparagraph 2, shall be counted as the number of directors then actually in office.

Article 13 The Company’s board of directors meeting shall be conducted in accordance with the order of business on the agenda as specified in the meeting notice. However, the order may be changed with the approval of a majority of directors present at the meeting.

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

If at any time during the proceeding of a board of directors meeting the directors sitting at the meeting are not more than half of the directors present at the meeting, then upon motion by the directors sitting at the meeting, the chair shall declare a suspension of meeting, in which case Article 12, paragraph 2 shall apply mutatis mutandis.

Article 14 When the chair at a board of directors meeting is of the opinion that a matter has been sufficiently discussed to a degree of putting to a vote, the chair may announce the discussion closed and bring the matter to vote.

When a proposal comes to a vote at a board of directors meeting, if the chair puts the matter before all directors present at the meeting and none voices an objection, the matter is deemed approved. If there is an objection following an inquiry by the chair, the proposal shall be brought to a vote.

One voting method for proposals at a board meeting shall be selected by the chair from among those below, provided that when an attending director has an objection, the chair shall seek the opinion of the majority to make a decision:

• I. A show of hands or a vote by voting machine.

• II. A roll call vote.

III. A vote by ballot.

Except for the case of unanimous consent of all directors present at the meeting upon inquiry, the method of voting on matters at board of directors meetings and the methods of vote monitoring and counting shall also be specified. The method of voting on matters at board of directors meetings shall be specified in the meeting minutes.

“All directors present at the meeting” in the preceding two paragraphs shall not include directors prohibited from exercising voting rights pursuant to Article 16, paragraph 1.

Article 15 Except as otherwise stated in the Securities and Exchange Act or in the Company Act, a

resolution on a matter at a board of directors meeting shall require the approval of a majority of the directors in attendance at a board of directors meeting attended by a majority of all directors.

When there is an amendment or an alternative to a proposal, the chair shall present the

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

If a vote on a proposal requires monitoring and counting personnel, the chair shall appoint such personnel, providing that all monitoring personnel shall be directors.

Voting results shall be made known on-site immediately and recorded in writing.

• Article 16 If a director or a juristic person that the director represents is an interested party in relation to an agenda item, the director shall state the important aspects of the interested party relationship at the respective meeting. When the relationship is likely to prejudice the interest of the company, that director may not participate in discussion or voting on that agenda item and shall recuse himself or herself from the discussion or the voting on the item, and may not exercise voting rights as proxy for another director. If a director violates the aforesaid rule and participates in voting on that agenda item that requires him or her to enter recusal, the voting rights exercised by said director shall be invalid.

• Where the spouse, a blood relative within the second degree of kinship of a director, or any company which has a controlling or subordinate relation with a director has interests in the matters under discussion in the meeting of the preceding paragraph, such director shall be deemed to have a personal interest in the matter.

The provisions of Article 180, paragraph 2 of the Company Act, as applied mutatis mutandis under Article 206, paragraph 4 of that Act, apply to resolutions of board of directors meetings when a director is prohibited by the preceding two paragraphs from exercising voting rights.

Article 17 Minutes shall be prepared of the discussions at board of directors meetings. The meeting minutes shall record the following:

• I. Session, time, and place of meeting.

• II. Name of the meeting chair.

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

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

• V. Name of minutes taker.

• VI. Reporting Items.

• VII. Agenda items: the method of resolution and the result for each proposal; a summary of the comments made by directors, experts, or other persons; the name of any director that is an interested party as referred to in paragraph 1 of the preceding article, an explanation of the important aspects of the relationship of interest, the reasons why the director was required or not required to enter

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recusal, and the status of their recusal; opinions expressing objections or reservations at the meeting that were included in records or stated in writing; and any opinion issued in writing by an independent director under Article 7, paragraph 7.

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

IX. Other items to be stated.

Any of the following matters in relation to a resolution passed at a meeting of the board of directors shall be stated in the meeting minutes and within two days of the meeting be published on an information reporting website designated by the competent authority:

• I. Any matter about which an independent director expresses an objection or reservation that has been included in records or stated in writing.

• II. Any matter that has not been passed by more than one-half of the audit committee members, but has been adopted with the approval of two-thirds or more of all board directors.

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

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

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

Article 18 The Company shall record on audio or video tape the entire proceedings of a board of directors meeting, and preserve the recordings for at least five years, in electronic form or otherwise.

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

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concluded.

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

Article 19 If the board of directors has managing directors, the provisions of Article 2, paragraph 2 of Article 3, Articles 4 to 6, Article 9, and Articles 11 to Article 18 shall apply mutatis mutandis to the procedure for meetings of the managing directors; However, if a meeting of managing directors is scheduled to be convened within seven days, the notice to each managing director may be made two days in advance.

Article 20 These Rules shall be adopted by the approval of meeting of the Board of Directors and shall be reported to the shareholders’ meeting. The same procedures shall apply for future amendments.

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(Appendix 5)

King Yuan Electronics Co., Ltd.

Number of Shares Held by All Shareholders and Minimum Number of Shares to Be Held

• I. The number of common stocks of the Company: 1,222,745,065 shares

• II. The minimum number of authorized shares that all directors shall hold: 32,000,000 shares

• III. As of the closing date of the shareholders’ meeting (April 1, 2023), the number of shares held by

• all directors is as follows:

Title	Name	Number of shares held on closing date	Number of shares held on closing date
		Shares	Shares held (%)
Chairman	Chin-Kung Lee	34,100,941	2.79
Vice-Chairman	Chi-Chun Hsieh	5,552,037	0.45
Director	An-Hsuan Liu	1,250,000	0.10
Director	Kao-Yu Liu	4,808,267	0.39
Director	Kuan-Hua Chen	3,168,574	0.26
Director	Representative of Yann Yuan Investment Co.,Ltd.: Ping-Kun Hung	52,600,000	4.30
Independent director	Hui-Chun Hsu	0	0
Independent director	Dar-Yeh Hwang	0	0
Independent director	Semi Wang	10,000	0
Number of shares held by all directors (excluding independent directors)		101,479,819	8.30

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(Appendix 6)

The Impact of Stock dividend Issuance on Business Performance, EPS, and Shareholder’s Return on Investment: N/A.

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==> picture [200 x 48] intentionally omitted <==

■ Headquarters：300046 No.81,Sec.2,Gongdaowu Rd.,Hsin-Chu,Taiwan,R.O.C. TEL：886-3-5751888

■ Chu-NanBranch：350021 No.118,Chung-Hua Rd.,Chu-Nan,Miao-Li,Taiwan,R.O.C. TEL：886-37-595666

■ TongluoBranch：366003 No.8,Tongke N. Rd., Tongluo Township,Miao-Li,Taiwan,R.O.C. TEL：886-37-980188