KYEC - AGM Information 2024 | FinancialReports.eu

Stock symbol: 2449

==> picture [414 x 79] intentionally omitted <==

2024Annual General Meeting Handbook

May 31, 2024

	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 ................................................................................ 12
III.	Annexes
	1.	Business Report (Annex 1) ....................................................................... 13
	2.	Audit Report by the Audit Committee (Annex 2) .................................... 18
	3.	Comparison Table before and after amendment of Rules and Procedures for
		Board of Directors Meetings (Annex 3) ................................................... 19
	4.	2023 Earnings Distribution (Annex 4) ..................................................... 21
	5.	Comparison Table before and after amendment of Articles of Incorporation
		(Annex 5) .................................................................................................. 22
	6.	CPA Audit Report and Financial Statements (Annex 6) ........................... 24
	7.	List of candidates of directors (Annex 7) ................................................. 44
IV.	Appendices
	1.	Rules of Procedure for Shareholders’ Meetings (Appendix 1) ................ 45
	2.	Rules Governing the Election of Directors (Appendix 2) ........................ 48
	3.	Articles of Incorporation (Appendix 3) .................................................... 51
	4.	Rules of Procedures for Board of Directors Meetings (Appendix 4) ....... 57
	5.	Number of Shares Held by All Directors and Minimum Number of Shares
		to be Held (Appendix 5) ........................................................................... 66
	6.	The Impact of Stock Dividend Issuance on Business Performance, EPS,
		and Shareholder’s Return on Investment (Appendix 6) ........................... 67

King Yuan Electronics Co., Ltd. 2024 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

-1-

King Yuan Electronics Co., Ltd.

2024 Annual General Meeting Agenda

Convention Method: Physical Convention of Annual General Meeting

Time: 9:00 a.m. on Friday, May 31, 2024

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 2023 Business Overview.
The Audit Committee’s Review of the Company’s 2023 Financial Report.
The Company’s 2023 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 2023 Business Report and Financial Statements.
The Company’s 2023 Distribution of Earnings.
V. Elections

By-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.
Request for review of the motion for amendment of Articles of Incorporation.

VII. Extraordinary Motions

VIII. Meeting Adjourned

-2-

Reporting Items

Report No. 1 Proposed by the Board of Directors Motion: The Company’s 2023 Business Overview.

Description: For the 2023 business report, please refer to page 13 (Annex 1).

-3-

Proposed by the Board of Directors

Report No. 2

Motion: The Audit Committee’s Review of the Company’s 2023 Financial Report. Description:

The Company’s 2023 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 18.
For the review report prepared by the CPA, please refer to Annex 6 on page 24.

-4-

Proposed by the Board of Directors

Report No. 3

Motion: The Company’s 2023 Distribution of Employee and Director Remuneration. Description:

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 2023 totaled NT$7,835,471,022 (i.e., earnings before tax less remuneration to employees and directors), 8% or NT$626,837,682 of which was allocated as remuneration to employees in cash and 0.8% or NT$62,683,768 as directors’ remuneration.

-5-

Proposed by the Board of Directors

Report No. 4

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

Description:

The Company has amended Articles 11, 12, and 13 of the Rules and Procedures for Board of Directors Meetings in accordance with amendments to Articles 12 and 13 of the Regulations Governing Procedure for Board of Directors Meetings of Public Companies as stated in Jin-Guan-Zheng-Fa No. 1120383996 issued by the Financial Supervisory Commission on January 11, 2024.
Please refer to Annex 3 on page 19 for the Comparison Table before and after amendments to the Company’s Rules and Procedures for Board of Directors Meetings.

-6-

Ratification Items

Ratification No. 1 Proposed by the Board of Directors

Motion: The Company’s 2023 Business Report and Financial Statements. Description:

The Company’s 2023 Business Report and Financial Statements have been approved in the 9th meeting of the 15th-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 13 and Annex 6 on page 24.

Resolution:

-7-

Ratification No. 2

Proposed by the Board of Directors

Motion: The Company’s 2023 Distribution of Earnings.

Description:

The Company’s 2023 distribution of earnings report has been approved in the 9th meeting of the 15th-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 2023 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:

-8-

Elections

Proposed by the Board of Directors

Motion: By-election of the 15th term of Board of Directors. Description:

In accordance with Article 13 of the Company's Articles of Incorporation, the Company’s 15th-term Board of Directors is composed of nine directors (including three independent directors). Because of a vacancy in the Board, a by-election will be held at the 2024 Shareholders’ Meetings to fill the vacancy. The new director’s term will begin on May 31, 2024 and end on May 29, 2026.
The Company shall adopt a candidate nomination system for election of directors. The shareholders shall elect the directors from among the nominees listed on the roster. Please refer to Annex 7 on page 44 for the education background, past work experience, and other relevant information of the director candidates.
Please proceed with by-election as proposed.

Election result:

-9-

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:

Because the Company will hold a by-election of directors at the shareholders' meeting on May 31, 2024 and the new director candidate is 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 the new director 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:
Gauss Chang, Director of King Long Technology (Suzhou) Ltd. and Suzhou Zhen Kun Technology Ltd.

Resolution:

-10-

Discussion No. 2 Proposed by the Board of Directors

Motion: Request for review of the motion for amendment of Articles of Incorporation.

Description:

The Company proposes to amend Articles 13, 15, and 22 of the Articles of Incorporation in accordance with Financial Supervisory Commission's (FSC) “Corporate Governance 3.0-Sustainable Development Roadmap” and “Sustainable Development Action Plans for TWSE- and TPEx-Listed Companies (2023)”; with TWSE Letter No. 11200147631 issued on August 23, 2023 concerning partial amendments to the “Operation Directions for Compliance with the Establishment of Board of Directors by TWSE Listed Companies”; and with FSC Jin-Guan-Zheng-Fa No. 1120383996 issued on January 11, 2024 concerning amendment to Article 13 of the “Regulations Governing Procedure for Board of Directors Meetings of Public Companies.”
Please refer to Annex 5 on page 22 for the Comparison Table before and after amendments to the Company’s Articles of Incorporation.

Resolution:

-11-

Extraordinary Motions

Meeting Adjourned

-12-

(Annex 1)

King Yuan Electronics Co., Ltd. Business Report

The year 2023 passed with anticipation for the economic recovery of the semiconductor industry and with the rise of artificial intelligence (AI) chips. Moreover, the global political and economic environment showed no clear signs of improvement and demand for consumer products stagnated. As a result, the Company's revenue and profits failed to achieve breakthrough growth. However, given the distribution of customer and testing product structures, the Company was not affected by this wave of economic adjustment compared with our peers. An overview of our last year's operational performance is described below.

Business Plan Implementation Results

The consolidated operating revenue was NT$33.025 billion in 2023, down 10.2%. Gross profit margin was 33.7%, a decrease of 1.7% compared with 35.4% last year. Earnings per share (EPS) was NT$4.78, a decrease of NT$0.81 compared with previous year. The Company delivered favorable business performance in general.

In 2023, the semiconductor industry entered a period of economic recession. Although urgent orders fluctuated mid-year and the global economic environment did not deteriorate further, China's economy did not rebound after the lifting of pandemic restrictions. Demand weakened for consumer products, network communication products, general servers, and computer products, and industrial and automotive products began to decline in Q4. Fortunately, the high-performance computing (HPC) chips for artificial intelligence (AI) had offset some of the factors that were unfavorable to the Company’s revenue, providing support to our business performance.

Because of the low visibility into clients’ inventory adjustments, the Company is committed to cost control: Fixed costs such as depreciation expense are stable; variable costs, such as direct and indirect materials and spare parts, decreased; and sales and management expenses did not increase. As a result, the Company’s annual operating gross profit margin and operating profit rate decreased only slightly compared with previous year, ridding us of the few waves of economic recession in the past and of the inevitable decline of the company's profitability.

In terms of manufacturing management, the Company has launched a number of smart factory improvement plans at Chu-Nan Factory and Tong-Luo Factory, with results gradually coming to fruition - including automated factory operations, adoption of smart manufacturing practices, streamlined processes, improved production efficiency, and reduced reliance on labor work. We also used AI technology to optimize internal factory operations in the areas of automated cargo loading, education and training, machine failure prevention/diagnosis, automated comparison for error reduction, quality management, operating procedure efficiency, production efficiency analysis, and database operation analysis.

In addition, the Company continues to fine-tune its machine capacity utilization rate, shortens the delivery time of important products, cares about customer service satisfaction, strengthens employees' task efficiency, and invests in improving ESG performance. In doing so, the Company

-13-

can continually improve its overall operating system and cultivate resilience to the fast-changing external environment.

Financial income and profit analysis

With respect to financial and profit status in 2023, the Company saw a sound financial structure, with debt to total assets ratio of 45.85% down by 4.46% from previous year, and long-term capital to fixed assets ratio of 141.88% up 8.35% compared with last year. Current ratio and quick ratio increased by 66.41% and 63.02% from previous year, reaching 284.47% and 264.15%, respectively, indicating further increase in short-term liquidity. In terms of the company’s profitability which was affected by the economic recession, our return on assets (ROA), return on equity (ROE), net profit margin, and earnings per share were 8.86%, 15.63%, 18.22%, and NT$4.78, respectively, which decreased by 1.27%, 3.81%, 0.76%, and NT$0.81 compared with previous year, suggesting satisfactory results for both financial income and profits.

R&D status

With respect to research and development, the Company's R&D center consolidates resources to not only provide customers with a comprehensive range of testing solutions - from adoption to mass production of new products - for technical problems encountered in the testing process. We are committed to creating a fully equipped testing environment that enables us to sort out problems related to product and component production, and also to automating production processes, making our factories smarter, and developing unparalleled testing service capabilities.

Because the company specializes in integrated circuit (IC) testing, we have gained an in-depth understanding of testing machines that form the core of the testing industry, and even developed testers and burn-in ovens in-house over the past two decades. The R&D blueprints for those testing devices have been increased and improved in terms of specifications, performance, and quantity to satisfy customer needs. Our other focuses include PCB designing, manufacturing, and simulation technology, as well as the designing and manufacturing of testing equipment adapters, testing accessories, probe cards, and substrate boards. We continue to integrate relevant testing systems, and introduce our in-house developed testing equipment to different product applications to keep pace with time and the changing market. Last year, we developed a wide range of equipment and key components, such as logic IC testing machines, image sensors, driver IC machines, microelectromechanical (MEMS) machines, and high power burn-in ovens.

In the area of testing software, as testing equipment and customer products become increasingly more sophisticated and automatic testing programs and conversion systems are being developed, we incorporate artificial intelligence to improve production efficiency and user convenience. We embrace the rapidly advancing technology by developing new testing technologies such as high-frequency, high-power, heterogeneous and advanced packaging, and silicon photonics to maintain our unique competitive edge in the field of semiconductor manufacturing and testing.

Overview of Current Business Plan

Looking forward to 2024, the economy of the semiconductor industry is projected to recover. We plan to develop our business by following our strategic directions to achieve breakthrough in

-14-

performance growth targets; by combining market structure with customer needs to improve equipment utilization rate and investment returns; and by promoting our machine development business through applications and strategic alliance with clients at the front end. Specifically, we will take the following actions: Improve customer services by focusing on key customer satisfaction, strengthening problem-solving capability, and strictly controlling customer complaints and the cost of quality failure; Improve production and manufacturing processes by fine-tuning the integration of automation and smart manufacturing, achieving further breakthrough in productivity, and improving our technical know-how; Enforce cost control by promoting diverse cost control practices, paying attention to the suitability of use of material, and improving inventory management; Engage in R&D innovation by building up our experience in using and maintaining our own equipment, working with production units to gain access to other platforms, strengthening our R&D capacity for core technologies and key components and equipment, and ensuring the quality of our intellectual properties and patents; and Enhance human resources by retaining high-caliber talents, recruiting employees, cultivating key competencies, training supervisors, and taking the initiative to create rotation plans for supervisors.

Future development strategy

In the midst of U.S.’s deglobalization movement and its containment of China’s technology and semiconductor industries, the global semiconductor supply chain has undergone restructuring, resulting in the concentration of high-end semiconductor manufacturing in Taiwan. Products contain high silicon content, which have increased both unit price and profits. The Company’s future development strategy will attach importance to customer services. Specifically, we aim to strengthen the core value provided to customers by the manufacturing supply chain, develop differentiating capabilities for our professional testing service, improve the operational efficiency of company systems used in the complex manufacturing process, support customers’ product launch, and grow together with customers as their trusted partner.

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 conflict of the U.S.–China technology competition and China's push for semiconductor independence, the Company will carefully evaluate and adjust the global development of its semiconductor manufacturing business and seize opportunities for strategic cooperation with upstream and downstream vendors to prepare for any environmental changes in the future.

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

According to Gartner, a research and consulting firm, worldwide semiconductor revenue decreased 10.9% in 2023 to $534 billion compared with 2022, and is projected to increase by 16.8% in 2024 to US$624 billion. In general, the semiconductor industry is expected to reach a healthy inventory level in 2024 in the IC design industry. 2024 will be a year of opportunities for the recovery of the semiconductor industry - attributable to increase in advanced chip manufacturing and advanced packaging production, rebuilding of IC inventory, increase in silicon content in

-15-

smartphones, recovery of demand for consumer, computer, and electric vehicle products, and exponential increase in demand for AI HPC and edge computing chips.

The IMF’s global growth forecast for 2024, published in January 2024, was at 3.1%, which was roughly the same as in 2023 but still below the historical average of 3.8%. According to the World Bank, global growth is projected to slow for the third year in a row—from 3% in 2022 and 2.6% in 2023 to 2.4% in 2024. Emerging markets - India and China are projected to have a stronger growth, followed by developed countries - United States and Spain, while Europe and Japan registered weaker growth. This year’s global economic growth requires continued observation of its recovery strength due to uncertainties from a mixture of factors such as interest rate, exchange rate, inflation, unemployment rate, consumer spending power, U.S. Dollar asset liquidity, U.S.’s budget deficit and debt spiral, and geopolitical issues.

In terms of external competition, the advent of 5G in 2019, the mass production of the 5nm node for advanced semiconductor processes, and improvements to advanced packaging structures have greatly enhanced the performance of IC SOC and SiP products. Since the global domination of the semiconductor industry, the concentration of upstream and downstream suppliers has created an oligopolistic phenomenon in which they become interdependent of one another. Consequently, the ability of OEM’s operating systems to deliver output becomes imperative. In other words, production capacity, technology, quality, service, technical support, production efficiency, price, information, finance, and corporate culture, among other aspects must be closely integrated to meet customers’ supply chain requirements. Therefore, semiconductor manufacturers and supply chain capabilities are concentrated in Asia, particularly in Taiwan and China. In recent years, the United States has been promoting the “China Plus One” (C+1) strategy - a practice of diversifying manufacturing operations by adding facilities in the US or outside of China. As a result, a distinction has been formed between China's supply chain, which relies on mature processes, and Taiwan's supply chain, which focuses on advanced manufacturing processes. Semiconductor manufacturers based in Taiwan have continuously established factories overseas, while packaging and testing OEMs are ramping up efforts to compete for OEM orders from world-class customers and each of them are developing their core businesses. KYEC views competition as a norm in that it not only enriches our professional testing capabilities and experience but also cultivates our unique competitive advantages for sustainable growth.

In terms of laws and the general business environment in 2023, the United States has continued to impose bans on China’s technology and semiconductor industries by frequently updating the restricted trade list and introducing export restrictions. In response, China has been working toward self-sufficiency in the semiconductor industry. Despite being limited by mature manufacturing processes, China’s semiconductor sector saw a drastic increase in the import of semiconductor equipment. The construction of many wafer fabs has been completed this year, releasing the production capacity of packaging and testing factories, which triggered a drop in OEM prices. Products manufactured using mature processes are adversely affected by China’s industrial growth and thus must not be overlooked.

Looking back on last year, in the midst of rapid global inflation, U.S. interest hikes, and the

-16-

subsequent effects of tightened monetary policy, economic growth has weakened and shrinking demand has delayed recovery. In addition, the chaos caused by the war between Ukraine and Russia, the war in the Middle East, and the geopolitical struggle between China and the United States have only added a multitude of uncertainties to the general business environment.

Looking forward to 2024, the semiconductor supply chain and market demand is poised to achieve balanced development, and accelerated recovery of demand is anticipated. However, the gap between expectations for interest rate cut and rapid decline in inflation and the decisions actually made has caused fluctuations in the investment environment. Moreover, the results of this year’s US political election will possibly exert an enormous impact on the global landscape in the areas of politics, economy, military, democracy, and centralization of authority.

Given this year’s US Consumer Electronics Show (CES) and the global development of technology products, there is a strong demand for advanced semiconductor manufacturing processes and advanced packaging and testing capability. The ecological prototypes of future technologies in various industries and sectors have emerged, with most of them revolving around AI, IOT, network communication transmission, edge computing, high-performance computing, and integration with software development in various aspects of smart living, such as smart health, smart medical care, smart homes, smart cities, smart factories, smart robots, and smart cars, among others. Generative and inferential AI have driven a substantial growth of personal mobile devices, transportation vehicles, enterprise and industrial metaverses, high-speed high-frequency transmission, and data center servers. The technological application of semiconductor IC components is focused on smartphones, automotive electronics, or traditional products such as personal computers, and AI will bring about a variety of business innovation opportunities, thus increasing the demand for silicon content in semiconductor products. In other words, there remains a significant potential for development in the future of semiconductor manufacturing.

Despite the slow economic recovery in the first half of 2024, the Company remains optimistic about opportunities for future business growth. We will continue to invest in talent development and equipment operations, expand production lines, build new factories, commit to customer services, and strive to work with suppliers in order to prosper together. As we prepare for the advent of the next economic prosperity, we pledge to make maximizing shareholders’ equity as our top priority.

Chairman:

Manager: Accounting Supervisor:

-17-

(Annex 2)

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

With regard to the Company's 2023 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: Semi Wang

February 23, 2024

-18-

(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 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 the aforementioned professionals	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.	Amendment made in accordance with the laws
	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 timeon the day of the meeting, 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, 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.	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, 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.	Amendment made in accordance with the laws

-19-

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. If at any time during the proceeding of a board	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.	Amendment made in accordance with the laws
	of directors meeting the chair is unable to chair
	a meeting due to any other reason or did not declare the meeting closed as stipulated in paragraph 2, the chair shall appoint a proxy to act on his/her behalf, in which case Article 10 paragraph 3 shall apply mutatis mutandis.

-20-

(Annex 4)

King Yuan Electronics Co., Ltd. 2023 Earnings Distribution Statement

King Yuan Electronics Co., Ltd. 2023 Earnings Distribution Statement	King Yuan Electronics Co., Ltd. 2023 Earnings Distribution Statement	King Yuan Electronics Co., Ltd. 2023 Earnings Distribution Statement	King Yuan Electronics Co., Ltd. 2023 Earnings Distribution Statement
Unit: NT$
Item	Amount		Projected dividend
Unallocated earnings – beginning		8,256,173,169
Add: Netprofit after tax	5,840,364,840
Add: Confirmed actuarialgain/loss of welfare	20,738,773
The amount of net profit after tax for the period and the amount adjusted to the current year’s undistributed earnings		5,861,103,613
Less: Provision of 10% legal reserve		(586,110,361)
Allocable earnings		13,531,166,421
Scope of allocation
Dividends to shareholders – cash		3,912,784,208	NT$3.2per share
Total allocation		3,912,784,208
Unallocated earnings – ending		9,618,382,213
Note: 1. According to the Company’s distribution policy, the allocable earnings for 2023 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 last-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 by the general shareholders’meeting.

Manager:

Accounting Supervisor:

Chairman:

-21-

(Annex 5)

King Yuan Electronics Co., Ltd. The comparison table before and after the amendment of the Articles of Incorporation

Provision	Provision After Amendment	Provisions Before Amendment	Reason for Amendment
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-third of the seats shall be held by directors.All independent directors may not serve more than three consecutive terms. 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.	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.	In accordance with regulatory amendments by TWSE.
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 Actand the Company’s Rules and Procedures for Board of	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.	In accordance with regulatory amendments by FSC.
	Directors Meetings.

-22-

Article 22	These Articles of Incorporation were established on May 2, 1987. First amendment was made on May 20, 1987. Second amendment was made on X,1988. ………………………………………… 36th amendment was made on August 3, 2021.37th amendment was made on May 31, 2024.	These Articles of Incorporation were established on May 2, 1987. First amendment was made on May 20, 1987. Second amendment was made on X,1988. ………………………………………… 36th amendment was made on August 3, 2021.37th amendment was made on May 31, 2024.	These Articles of Incorporation were established on May 2, 1987. First amendment was made on May 20, 1987. Second amendment was made on X,1988. ………………………………………… 36th amendment was made on August 3, 2021.	Amendment date was added.

-23-

(Annex 6)

==> picture [70 x 53] intentionally omitted <==

�� 30078 �� 1 � E-3 �� Tel: 886 3 688 5678 E-3, No. 1, Lixing 1st Rd., Hsinchu Science Park �� Fax: 886 3 688 6000 Hsinchu City, Taiwan, R.O.C. ey.com/zh_tw

English Translation of a Report Originally Issued in Chinese

Independent Auditors’ Report

To the Board of Directors and Shareholders of King Yuan Electronics Co., Ltd.

Opinion

We have audited the accompanying parent company only balance sheets of King Yuan Electronics Co., Ltd. as of December 31, 2023 and 2022, and the related parent company only statements of comprehensive income, changes in equity and cash flows for the years ended December 31, 2023 and 2022, and notes to the parent company only financial statements, including the summary of significant accounting policies (together “the financial statements”).

In our opinion, the parent company only financial statements referred to above present fairly, in all material respects, the financial position of King Yuan Electronics Co., Ltd. as of December 31, 2023 and 2022, and its financial performance and cash flows for the years ended December 31, 2023 and 2022, in conformity with the requirements of the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Financial Statement Audit and Attestation Engagements of Certified Public Accountants and the Standards on Auditing of the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are independent of King Yuan Electronics Co., Ltd. in accordance with the Norm of Professional Ethics for Certified Public Accountant of the Republic of China (the “Norm”), and we have fulfilled our other ethical responsibilities in accordance with the Norm. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

-24-

==> picture [70 x 52] intentionally omitted <==

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of 2023 parent company only financial statements. These matters were addressed in the context of our audit of the parent company only financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Revenue recognition

King Yuan Electronics Co., Ltd. recognized NT$24,005,557 thousand as net sales. Its main activities are providing testing and assembly services that represented 86.5%, or NT$20,752,854 thousand in the amount, of the net operating revenue.

Since the primary activities of King Yuan Electronics Co., Ltd. are providing testing and assembly services, and the services comprise various wafers/integrated circuits testing and assembly processing and rental of machinery, timing of revenue recognition may vary due to varied nature of revenue that increases the complexity of the revenue recognition. Therefore, we determined the matter to be a key audit matter.

Our audit procedures include (but are not limited to) assessing the appropriateness of the accounting policy for revenue recognition, evaluating and testing the effectiveness of internal control relating to the timing of revenue recognition, analyzing the reasonableness of gross margin by products, performing cutoff testing for a period before and after the balance sheet date on a sampling basis, performing test of details on selected samples, reviewing the significant terms of sales agreements and examining relevant delivery documents, and reviewing the selected samples of the quantity, specification, period and relevant documents of machinery services.

We also considered the appropriateness of the disclosures of sales. Please refer to Note 4 and Note 6 in notes to the financial statements.

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

Management is responsible for the preparation and fair presentation of the parent company only financial statements in accordance with the requirements of the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards, International Accounting Standards, Interpretations developed by the International Financial Reporting Interpretations Committee or the former Standing Interpretations Committee as endorsed by Financial Supervisory Commission of the Republic of China and for such internal control as management determines is necessary to enable the preparation of the financial statements that are free from material misstatement, whether due to fraud or error.

-25-

==> picture [70 x 52] intentionally omitted <==

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

Those charged with governance, including audit committee, are responsible for overseeing the financial reporting process of King Yuan Electronics Co., Ltd.

Auditor’s Responsibilities for the Audit of the Financial Statements

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

As part of an audit in accordance with the Standards on Auditing of the Republic of China, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the parent company only financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal control of King Yuan Electronics Co., Ltd.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

-26-

==> picture [71 x 54] intentionally omitted <==

Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the ability to continue as a going concern of King Yuan Electronics Co., Ltd. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the parent company only financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause King Yuan Electronics Co., Ltd. to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the parent company only financial statements, including the accompanying notes, and whether the parent company only financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the parent company only financial information of the entities or business activities within King Yuan Electronics Co., Ltd. to express an opinion on the financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

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

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of 2023 parent company only financial statements and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

-27-

==> picture [72 x 55] intentionally omitted <==

Kuo, Shao-Pin

Hsu, Hsin-Min

Ernst & Young, Taiwan February 23, 2024

Notice to Readers

The accompanying parent company only financial statements are intended only to present the financial position, results of operations and cash flows in accordance with accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to audit such financial statements are those generally accepted and applied in the Republic of China.
Accordingly, the accompanying parent company only financial statements and report of independent accountants are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in the Republic of China, and their applications in practice. As the financial statements are the responsibility of the management, Ernst & Young cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.

-28-

English Translation of Financial Statements Originally Issued in Chinese KING YUAN ELECTRONICS CO., LTD. PARENT COMPANY ONLY BALANCE SHEETS As of December 31, 2023 and 2022 (Amounts in thousands of New Taiwan Dollars)	%	15 - - 5 3 - 1 2 - - 26 8 16 49 1 - - - - 74 100	(continued) The accompanying notes are an integral part of the parent company only financial statements.
	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
	%	14 1 - 5 3 - - 1 - - 24 10 19 46 1 - - - - 76 100
	December 31, 2023	$8,882,025 414,846 - 3,312,182 1,890,418 133,265 118,170 893,393 111,898 62,568 15,818,765 6,541,681 12,146,191 30,253,819 438,829 11,732 302,946 147,333 5,300 49,847,831 $65,666,596
	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(19), 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 assets Intangible assets Deferred tax assets Other financial assets-non-current Other non-current assets Total non-current assets Total assets

-29-

KING YUAN ELECTRONICS CO., LTD. PARENT COMPANY ONLY BALANCE SHEETS As of December 31, 2023 and 2022 (Amounts in thousands of New Taiwan Dollars) English Translation of Financial Statements Originally Issued in Chinese	%	- 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
	%	- 1 - 5 - 1 - - 2 9 27 3 1 1 - 32 41 19 7 6 - 22 28 5 59 100
	December 31, 2023	$858 492,018 7,187 2,978,167 304,955 512,108 301,938 24,065 1,096,223 5,717,519 17,704,154 2,232,287 430,499 645,076 34,052 21,046,068 26,763,587 12,227,451 4,955,581 4,177,574 201,416 14,133,456 18,512,446 3,207,531 38,903,009 $65,666,596
	Notes	7 7 4, 6(20) 4, 6(16) 4, 6(10) 4, 6(11), 8, 9 4, 6(19), 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

-30-

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, 2023 and 2022

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

Description	Notes	2023	%	2022	%
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(9), 6(12), 6(16), 6(17), 7 4, 6(9), 6(12), 6(16), 6(17), 7 4, 6(2), 6(7), 6(18), 7 4, 6(20) 4, 6(19), 6(20) 4, 6(21)	$24,005,557 (16,076,305) 7,929,252 (400,767) (1,475,031) (811,514) (2,687,312) 5,241,940 64,519 263,493 195,477 (515,953) 1,918,303 1,925,839 7,167,779 (1,327,414) 5,840,365 20,738 1,747,230 (346,210) (214,008) 42,802 1,250,552 $7,090,917 $4.78 $4.74	100 (67) 33 (2) (6) (3) (11) 22 - 1 1 (2) 8 8 30 (6) 24 - 7 (1) (1) - 5 29	$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

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

-31-

	Total Equity	$34,184,275 - (3,668,235) 6,836,609 (1,331,396) 5,505,213 68,725 $36,089,978 $36,089,978 - (4,279,608) 5,840,365 1,250,552 7,090,917 1,722 - $38,903,009
Other equity	Unrealized gains (losses) from equity instrument investments measured at fair value through other comprehensive income	$3,660,911 - - - (1,382,136) (1,382,136) - $2,278,775 $2,278,775 - - - 1,401,020 1,401,020 - (16,180) $3,663,615
	Exchange differences resulting from translating the financial statements of foreign operations	$(390,828) - - - 105,950 105,950 - $(284,878) $(284,878) - - - (171,206) (171,206) - - $(456,084)
Retained earnings	Undistributed earnings	$10,580,312 (479,555) (3,668,235) 6,836,609 (55,210) 6,781,399 - $13,213,921 $13,213,921 (678,140) (4,279,608) 5,840,365 20,738 5,861,103 - 16,180 $14,133,456
	Special reserve	$201,416 - - - - - - $201,416 $201,416 - - - - - - - $201,416
	Legal reserve	$3,019,879 479,555 - - - - - $3,499,434 $3,499,434 678,140 - - - - - - $4,177,574
	Capital surplus	$4,885,134 - - - - - 68,725 $4,953,859 $4,953,859 - - - - - 1,722 - $4,955,581
	Common stock	$12,227,451 - - - - - - $12,227,451 $12,227,451 - - - - - - - $12,227,451
	Description	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 Balance as of January 1, 2023 Appropriation and distribution of 2022 earnings : Legal reserve Cash dividends Profit for the year ended December 31, 2023 Other comprehensive income for the year ended December 31, 2023 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, 2023

-32-

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	- (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	- (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	- (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	- (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	- (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	- (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	- (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
2023	68,954 (4,805,836) 752,538 - 95 (3,184) (871) 114,053	(3,874,251)	12,247,742 (14,715,957) 962 - (22,883) (4,279,608) (530,086)	(7,299,830)	(1,124,722) 10,006,747			$8,882,025
Description	Cash flows from investing activities : Proceeds from disposal of investments accounted for using the equity method Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Increase in refundable deposits Decrease in refundable deposits Acquisition of intangible assets Increase 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 financing activities Net (decrease) 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
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
2023	$7,167,779 6,610,001 27,284 515,953 (64,519) (99,233) (1,918,303) (114,436) 19 (327,775) (271,136) 7,218 179,656 (107,929) 259,988 (81,352) 226,490 (4,544) (7,638) (10,588) 45,484 972 (308,831) (2,269) (55,225) 7,970					11,675,036	64,837 (1,690,514)	10,049,359
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 Loss on disposal of other assets Unrealized foreign exchange (gains) losses 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 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

-33-

��

==> picture [71 x 55] intentionally omitted <==

30078 �� 1 � E-3 �� Tel: 886 3 688 5678 E-3, No. 1, Lixing 1st Rd., Hsinchu Science Park �� Fax: 886 3 688 6000 Hsinchu City, Taiwan, R.O.C. ey.com/zh_tw

English Translation of a Report Originally Issued in Chinese

Independent Auditors’ Report

To the Board of Directors and Shareholders of King Yuan Electronics Co., Ltd.

Opinion

We have audited the accompanying consolidated balance sheets of King Yuan Electronics Co., Ltd. and its subsidiaries as of December 31, 2023 and 2022, and the related consolidated statements of comprehensive income, changes in equity and cash flows for the years ended December 31, 2023 and 2022, and notes to the consolidated financial statements, including the summary of significant accounting policies (together “the consolidated financial statements”).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of King Yuan Electronics Co., Ltd. and its subsidiaries as of December 31, 2023 and 2022, and their consolidated financial performance and cash flows for the years ended December 31, 2023 and 2022, in conformity with the requirements of the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards, International Accounting Standards, Interpretations developed by the International Financial Reporting Interpretations Committee or the former Standing Interpretations Committee as endorsed and became effectively by Financial Supervisory Commission of the Republic of China.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Financial Statement Audit and Attestation Engagements of Certified Public Accountants and the Standards on Auditing of the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of King Yuan Electronics Co., Ltd. and its subsidiaries in accordance with the Norm of Professional Ethics for Certified Public Accountant of the Republic of China (the “Norm”), and we have fulfilled our other ethical responsibilities in accordance with the Norm. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

-34-

==> picture [70 x 52] intentionally omitted <==

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of 2023 consolidated financial statements. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Revenue recognition

King Yuan Electronics Co., Ltd. and its subsidiaries recognized NT$33,025,307 thousand as net sales. Its main activities are providing testing and assembly services that represented 85%, or NT$28,174,680 thousand in the amount, of the net operating revenue.

Since the primary activities of King Yuan Electronics Co., Ltd. and its subsidiaries are providing testing and assembly services, and the services comprise various wafers/integrated circuits testing and assembly processing and rental of machinery, timing of revenue recognition may vary due to varied nature of revenue that increases the complexity of the revenue recognition. Therefore, we determined the matter to be a key audit matter.

Our audit procedures include (but are not limited to) assessing the appropriateness of the accounting policy for revenue recognition, evaluating and testing the effectiveness of internal control relating to the timing of revenue recognition, analyzing the reasonableness of gross profit margin by products, performing cutoff testing for a period before and after the balance sheet date on a sampling basis, performing test of details on selected samples, reviewing the significant terms of sales agreements and examining relevant delivery documents, and reviewing the selected samples of the quantity, specification, period and relevant documents of machinery services.

We also considered the appropriateness of the disclosures of sales. Please refer to Note 4 and Note 6 in notes to the consolidated financial statements.

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

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the requirements of the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Financial Reporting Standards, International Accounting Standards, Interpretations developed by the International Financial Reporting Interpretations Committee or the former Standing Interpretations Committee as endorsed by Financial Supervisory Commission of the Republic of China and for such internal control as management determines is necessary to enable the preparation of the consolidated financial statements that are free from material misstatement, whether due to fraud or error.

-35-

==> picture [70 x 52] intentionally omitted <==

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

Those charged with governance, including audit committee, are responsible for overseeing the financial reporting process of King Yuan Electronics Co., Ltd. and its subsidiaries.

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements

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

As part of an audit in accordance with the Standards on Auditing of the Republic of China, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal control of King Yuan Electronics Co., Ltd. and its subsidiaries.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

-36-

==> picture [71 x 54] intentionally omitted <==

Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the ability to continue as a going concern of King Yuan Electronics Co., Ltd. and its subsidiaries. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause King Yuan Electronics Co., Ltd. and its subsidiaries to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements, including the accompanying notes, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within King Yuan Electronics Co., Ltd. and its subsidiaries to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of 2023 consolidated financial statements and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

-37-

==> picture [71 x 54] intentionally omitted <==

Others

We have audited and expressed an unqualified opinion on the parent company only financial statements of King Yuan Electronics Co., Ltd. as of and for the years ended December 31, 2023 and 2022.

Kuo, Shao-Pin

Hsu, Hsin-Min

Ernst & Young, Taiwan February 23, 2024

Notice to Readers

The accompanying consolidated financial statements are intended only to present the financial position, results of operations and cash flows in accordance with accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to audit such consolidated financial statements are those generally accepted and applied in the Republic of China.
Accordingly, the accompanying consolidated financial statements and report of independent accountants are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in the Republic of China, and their applications in practice. As the financial statements are the responsibility of the management, Ernst & Young cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.

-38-

English Translation of Financial Statements Originally Issued in Chinese KING YUAN ELECTRONICS CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS As of December 31, 2023 and 2022 (Amounts in thousands of New Taiwan Dollars)	%	17 - - 8 2 1 - 2 - - - 30 7 - 62 1 - - - - 70 100	(continued) The accompanying notes are an integral part of the consolidated financial statements.
	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
	%	17 1 - 7 3 - - 1 1 - - 30 9 - 60 1 - - - - 70 100
	December 31, 2023	$12,262,554 414,883 - 5,498,025 1,972,960 154,025 100,977 1,072,751 502,046 62,831 4 22,041,056 6,541,681 93,982 44,140,466 620,991 13,171 302,946 147,333 9,607 51,870,177 $73,911,233
	Notes	4, 6(1) 4, 6(16), 6(17), 7 4, 6(3), 6(17) 4, 6(4), 6(17) 4, 6(4), 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 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 assets Intangible assets Deferred tax assets Other financial assets-non-current Other non-current assets Total non-current assets Total assets

-39-

English Translation of Financial Statements Originally Issued in Chinese KING YUAN ELECTRONICS CO., LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS As of December 31, 2023 and 2022 (Amounts in thousands of New Taiwan Dollars)	%	1 - - 1 - 5 - 2 2 - 1 2 14 32 2 1 - 1 - 36 50 16 7 5 - 18 23 3 49 1 50 100	The accompanying notes are an integral part of the consolidated financial statements.
	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
	%	- - - 2 - 5 - 1 - - 1 1 10 31 3 1 - 1 - 36 46 16 7 6 - 19 25 4 52 2 54 100
	December 31, 2023	$220,133 9,365 858 1,154,413 7,154 3,424,447 69,979 752,648 406,759 30,876 574,528 1,096,832 7,747,992 22,601,096 2,345,260 441,190 70,017 645,076 34,052 26,136,691 33,884,683 12,227,451 4,955,581 4,177,574 201,416 14,133,456 18,512,446 3,207,531 38,903,009 1,123,541 40,026,550 $73,911,233
	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

-40-

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, 2023 and 2022

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

Description	Notes	2023	%	2022	%
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 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 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(9), 6(13), 6(18), 6(19), 7 4, 6(9), 6(13), 6(17), 6(18), 6(19), 7 4, 6(2), 6(7), 6(20), 7 4, 6(22) 4, 6(13), 6(21) 4, 6(23)	$33,025,307 (21,883,515) 11,141,792 (397,704) (2,080,568) (1,290,696) (9,295) (3,778,263) 7,363,529 134,498 488,495 169,393 (689,750) 17,754 120,390 7,483,919 (1,467,549) 6,016,370 20,738 1,747,230 (346,210) (231,435) 42,802 1,233,125 $7,249,495 $5,840,365 176,005 $6,016,370 $7,090,917 158,578 $7,249,495 $4.78 $4.74	100 (66) 34 (1) (7) (4) - (12) 22 - 1 1 (2) - - 22 (4) 18 - 6 (1) (1) - 4 22 17 1 18 21 1 22	$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

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

-41-

		Total Equity	$34,878,168 - (3,668,235) 6,982,090 (1,320,936)	5,661,154	74,330	$36,945,417	$36,945,417 - (4,279,608) 6,016,370 1,233,125	7,249,495	111,246 -	$40,026,550
		Non-controlling interests	$693,893 - - 145,481 10,460	155,941	5,605	$855,439	$855,439 - - 176,005 (17,427)	158,578	109,524 -	$1,123,541
Equity attributable to owners of the parent company		Equity attributable to owners of the parent company	$34,184,275 - (3,668,235) 6,836,609 (1,331,396)	5,505,213	68,725	$36,089,978	$36,089,978 - (4,279,608) 5,840,365 1,250,552	7,090,917	1,722 -	$38,903,009
	Other equity	Unrealized gains (losses) from equity instrument investments measured at fair value through other comprehensive income	$3,660,911 - - - (1,382,136)	(1,382,136)	-	$2,278,775	$2,278,775 - - - 1,401,020	1,401,020	- (16,180)	$3,663,615
		Exchange differences resulting from translating the financial statements of foreign operations	$(390,828) - - - 105,950	105,950	-	$(284,878)	$(284,878) - - - (171,206)	(171,206)	- -	$(456,084)
	Retained earnings	Undistributed earnings	$10,580,312 (479,555) (3,668,235) 6,836,609 (55,210)	6,781,399	-	$13,213,921	$13,213,921 (678,140) (4,279,608) 5,840,365 20,738	5,861,103	- 16,180	$14,133,456
		Special reserve	$201,416 - - - -	-	-	$201,416	$201,416 - - - -	-	- -	$201,416
		Legal reserve	$3,019,879 479,555 - - -	-	-	$3,499,434	$3,499,434 678,140 - - -	-	- -	$4,177,574
		Capital surplus	$4,885,134 - - - -	-	68,725	$4,953,859	$4,953,859 - - - -	-	1,722 -	$4,955,581
		Common stock	$12,227,451 - - - -	-	-	$12,227,451	$12,227,451 - - - -	-	- -	$12,227,451
		Description	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 Balance as of January 1, 2023 Appropriation and distribution of 2022 earnings: Legal reserve Cash dividends Profit for the year ended December 31, 2023 Other comprehensive income for the year ended December 31, 2023 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, 2023

-42-

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	(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	(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	(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	(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	(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	(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	(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
2023	(7,726,307) 345,278 252 (3,184) (2,400) (871) 114,053	(7,273,179)	221,830 (1,023,479) 13,974,312 (15,677,089) 962 - (29,663) (4,279,608) (706,544) 24,258	(7,495,021)	(45,692)		(553,561) 12,816,115	$12,262,554
Description	Cash flows from investing activities : 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 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 financing activities Effect of changes in exchange rate on cash and cash equivalents Net (decrease) 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
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
2023	$7,483,919 9,105,051 29,223 9,295 689,750 (134,498) (99,233) 86,529 (17,754) (78,514) 19 (405,089) (261,130) 7,218 (125,226) (219,812) 260,711 (74,727) 295,875 (386,298) (7,705) (147,274) (10,588) 146,364 939 (285,484) (11,718) (55,017) 7,970 27,197					15,829,993	126,058 (1,695,720)	14,260,331
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 Loss on disposal of other assets Unrealized foreign exchange (gains) losses 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

-43-

(Annex 7)

King Yuan Electronics Co., Ltd. 2024 Annual General Meeting List of candidates of directors

No.	Type of Candidate	Name of Candidate	Education	Experience	Current Position	Shares held
1	Director	Gauss Chang	Graduated from Department of Physics, NCKU Master of Business Administration form Saginaw Valley State University, USA	Executive Vice President of KYEC Senior Vice President of KYEC	President of KYEC Chairman of King Long Technology (Suzhou) Ltd. Chairman of Suzhou Zhen Kun Technology Ltd. Chairman of KYEC USA Corp. Chairman of KYEC SINGAPORE PTE. LTD. Chairman of KYEC Japan K.K.	3,051,294

-44-

(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:

  1. 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’ meeting, only

-45-

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

-46-

shareholders’ meeting.

Article 15: These Rules were established on August 20, 1997. First amendment was made on May 7, 2002.

-47-

(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

-48-

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 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:

The ballot was not prepared as stipulated in Article 5.
The number of candidates filled in the ballot exceeds the number of seats to be elected as stipulated in Article 4.
The total votes cast by the voter exceeds the total voting rights of that voter.
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.
The writing is unclear and indecipherable or has been altered.
The name of the candidate entered in the ballot is identical to that of another

-49-

shareholder, but no shareholder account number or identity card number is provided in the ballot to identify such individual.

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.
A blank ballot is placed in the ballot box.

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.

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.

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.

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.

Forth amendment was made on June 12, 2014.

-50-

(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 issued shares.

-51-

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.
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

-52-

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 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:

-53-

Review of management policies and mid- to long-term development plans.
Review and ensure implementation of annual business plans.
Review of budget and final accounts.
Review plans of capital increase or decrease.
Review proposals of earnings distribution or making up loss.
Review of important external contracts.
Review of articles of incorporation or make amendments.
Review of the Company’s organizational rules and important business rules.
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.
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.

-54-

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

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

-55-

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

-56-

(Appendix 4)

King Yuan Electronics Co., Ltd. Rules and Procedures for Board of Directors Meetings

Amended on November 4, 2022

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. 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.

-57-

(II) Reporting on important financial and business matters.
(III) Internal auditing operations.
(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. 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.

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:

-58-

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.
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

-59-

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 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,

-60-

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, 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

-61-

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 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

-62-

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. Discussion 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 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

-63-

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 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

-64-

of Article 3, Articles 4 to 6, Article 9, and Articles 11 to the preceding article 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.

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.

-65-

(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 2, 2024), 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	Kao-Yu Liu	4,808,267	0.39
Director	Kuan-Hua Chen	3,143,574	0.26
Director	Representative of Yann Yuan Investment Co., Ltd.: Ping-Kun Hung	52,600,000	4.30
Independent director	Semi Wang	10,000	0
Independent director	Dar-Yeh Hwang	0	0
Independent director	Shi-Jer Sheen	0	0
Number of shares held by all directors (excluding independent directors)		100,204,819	8.19

-66-

(Appendix 6)

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

-67-

==> picture [253 x 39] 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

AI assistant

KYEC — AGM Information 2024

52090_rns_2024-06-14_d13bcf4a-6c10-4b26-b3a1-5eb967c9122d.pdf

2024Annual General Meeting Handbook

Contents

King Yuan Electronics Co., Ltd. 2024 Annual General Meeting Procedure

King Yuan Electronics Co., Ltd.

2024 Annual General Meeting Agenda

IV. Ratification Items

VI. Discussion Items

Reporting Items

Ratification Items

Motion: The Company’s 2023 Distribution of Earnings.

Elections

Elections

Election result:

Discussion Items

Extraordinary Motions

Meeting Adjourned

King Yuan Electronics Co., Ltd. Business Report

Business Plan Implementation Results

Financial income and profit analysis

R&D status

Overview of Current Business Plan

Future development strategy

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

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

King Yuan Electronics Co., Ltd. Comparison Table before and after amendment of Rules and Procedures for Board of Directors Meetings

King Yuan Electronics Co., Ltd. 2023 Earnings Distribution Statement

King Yuan Electronics Co., Ltd. The comparison table before and after the amendment of the Articles of Incorporation

English Translation of a Report Originally Issued in Chinese

Independent Auditors’ Report

Opinion

Basis for Opinion

Key Audit Matters

Revenue recognition

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

Auditor’s Responsibilities for the Audit of the Financial Statements

Notice to Readers

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, 2023 and 2022

English Translation of a Report Originally Issued in Chinese

Independent Auditors’ Report

Opinion

Basis for Opinion

Key Audit Matters

Revenue recognition

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

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements

Others

Notice to Readers

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, 2023 and 2022

King Yuan Electronics Co., Ltd. 2024 Annual General Meeting List of candidates of directors

King Yuan Electronics Co., Ltd. Rules of Procedure for Shareholders’ Meetings

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

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

King Yuan Electronics Co., Ltd. Rules and Procedures for Board of Directors Meetings

King Yuan Electronics Co., Ltd. Number of Shares Held by All Shareholders and Minimum Number of Shares to Be Held

More from KYEC

KYEC AGM Information 2024