LARGAN - AGM Information 2022 | FinancialReports.eu

Ticker number: 3008TT

Largan Precision Co., Ltd

2022 Annual General Shareholders’ Meeting

Meeting Agenda Handbook

(Translation)

June 8, 2022

----Disclaimer----

This is a translation of the agenda for the 2022 Annual General Shareholders’ Meeting of Largan Precision Co., Ltd. The translation is for reference only. If there is any discrepancy between the English version and Chinese version, the Chinese version shall prevail.

		Table of Contents
		Page Number
1.	Meeting Procedures .................................................................................................................... 1
2.	General	Shareholders’ Meeting Agenda....................................................................................... 2
3.	Report Items ............................................................................................................................... 3
4.	Proposals .................................................................................................................................... 5
5.	Discussions and Elections ............................................................................................................ 6
6.	Extemporary Motions ................................................................................................................ 8
Attachments		....................................................................................................................................... 9
	I.	2021 Business Report ................................................................................................. 9
	II.	Supervisors' Review Report ..................................................................................... 10
	III.	2021 Independent Auditors' Report, Parent Company Only Financial Statements, and
		Consolidated Financial Statements .......................................................................... 11
	IV.	2021 Earnings Distribution Table ............................................................................... 27
	V.	Comparison Table of Revisions to the "Articles of Incorporation" ............................ 28
	VI.	Comparison Table of Revisions to the “Procedures for the Acquisition or Disposal of
		Assets” ...................................................................................................................... 33
	VII.	Comparison Table of Revisions to the “Procedures for Engaging in Derivatives
		Trading” .................................................................................................................... 41
	VIII.	Comparison Table of Revisions to the “Rules for Loaning of Funds” ..................... 43
	IX.	Comparison Table of Revisions to the “Rules for Endorsements/Guarantees” ........ 46
Appendices ....................................................................................................................................... 50
	I.	Articles of Incorporation (Before Revision) .............................................................. 50
	II.	Procedures for the Acquisition or Disposal of Assets (Before Revision) ................. 58
	III.	Procedures for Engaging in Derivatives Trading (Before Revision) ......................... 75
	IV.	Rules for Loaning of Funds (Before Revision) ........................................................ 79
	V.	Rules for Endorsements/Guarantees (Before Revision) ........................................... 84
	VI.	Rules and Procedures of Shareholders' Meeting ...................................................... 90
	VII.	Procedures for Election of Directors ........................................................................ 94
	VIII.	Shareholding of Directors and Supervisors .............................................................. 96

Largan Precision Co., Ltd. 2022 Annual General Shareholders' Meeting Procedures

Call Meeting to Order
Chairman's Address
Report Items
Proposals
Discussions and Elections
Extemporary Motions
Meeting Adjourned

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Largan Precision Co., Ltd. 2022 Annual General Shareholders' Meeting Agenda

Time: 9 a.m., June 8, 2022 (Wednesday)

Place: No. 300, Chenggong West Road, Wuri District, Taichung City (Nan Shan Life Insurance Company Ltd. Education & Training Center)

Method of Meeting: Physical Meeting

Call meeting to order (report number of shares in attendance)
Chairman's Address
Report Items
(1) 2021 Business Report
(2) 2021 Supervisors' Review Report
(3) 2021 Employee, Director and Supervisor Compensation Report
(4) 2021 Cash Dividend Earnings Distribution Report
(5) Report on Execution of the Company’s Share Repurchase Plan
Proposals
(1) 2021 Business Report and Financial Statements
(2) 2021 Earnings Distribution
Discussions
(1) Amendment to the "Articles of Incorporation"
(2) Amendment to the "Procedures for the Acquisition or Disposal of Assets", "Procedures for Engaging in Derivatives Trading", "Rules for Loaning of Funds" and "Rules for Endorsements/Guarantees".
(3) Election of the Company's 18th-term of Directors
(4) Release of newly appointed Directors of the Company from non-compete restrictions
Extemporary Motions
Meeting Adjourned

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Report Items

2021 Business Report
Explanation: Please refer to Attachment I on page 9 of the Handbook.
2021 Supervisors’ Review Report
Explanation: Please refer to Attachment II on page 10 of the Handbook.
2021 Employee, Director and Supervisor Compensation Report
Explanation: The Company's compensation for Directors, Supervisors and employees in 2021 are distributed in accordance with the Company's Articles of Incorporation. Directors and Supervisors compensation is NT$252,052,059, and employee compensation is NT$3,363,085,784. All compensation shall be distributed in cash.
2021 Cash Dividend Earnings Distribution Report
Explanation: According to the "Articles of Incorporation", the Board of Directors has been authorized to distribute half yearly cash dividends. 2021 cash dividend earnings distribution report is as follows:

	follows:
2021	Dividend Payout Date	Cash Dividend Per Share (Note) (NT$)	Total Cash Dividend (NT$)
FirstHalf	2022/02/10	31.15608212	4,158,346,107
SecondHalf	2022/04/15	39	5,205,259,683
Total		70.15608212	9,363,605,790

Note: Total cash dividend calculated based on total outstanding 133,468,197 shares after deduction of share repurchase.

Report on Execution of the Company’s Share Repurchase Plan
Explanation: The Company’s execution of share repurchase in 2021 is as follows:

Repurchase Plan	First Time
Purpose of Share Repurchase	For the Company's credit and shareholders' rights andinterests
Scheduledperiod for the repurchase	2021/10/26~2021/12/24
Price range	NT$2,025~3,300
Planned number of shares to be repurchased	1,342,000 shares
Number and type of shares repurchased	Common stocks 672,000 shares
Total amount repurchased	NT$1,400,985,000
Number of shares cancelled	0

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Cumulative number of the ' 672,000 shares Company s own shares held Cumulative number of the Company's own shares as a 0.50% percentage of the total number of the ' Company s issued shares

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Proposals

Adoption of 2021 Business Report and Financial Statements (Proposed by the Board of Directors)

Explanation:

  - (1) The Parent Company Only Financial Statements and Consolidated Financial Statements prepared and delivered by the Board of Directors have been audited by KPMG Taiwan. The Financial Statements, along with the Business Report and Earnings Distribution Table, have been reviewed and verified by the Supervisors.

(2) Please refer to Attachment I on page 9 of the Handbook and Attachment III on page 11-26 of the Handbook for the aforementioned Business Report, Independent Auditor's Report, and Financial Statements.
(3) The proposed reports and statements are submitted for adoption.
Resolution:
Adoption of 2021 Earnings Distribution (Proposed by the Board of Directors) Explanation: The Company's 2021 Earnings Distribution has been approved by the Board of Directors. Please refer to Attachment IV on page 27of the Handbook for the detailed distribution statement.

Resolution:

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Discussions and Elections

Discussion of amendments to the "Articles of Incorporation" (Proposed by the Board of Directors)
Explanation: The Company's Articles of Incorporation is amended in accordance with the Company's business requirements and establishment of the Audit Committee. Please refer to Attachment V on page 28 of the Handbook for the comparison table of revisions to the Articles of Incorporation.

Resolution:

Discussion of amendments to the "Procedures for the Acquisition or Disposal of Assets", "Procedures for Engaging in Derivatives Trading", "Rules for Loaning of Funds" and "Rules for Endorsements/Guarantees" (Proposed by the Board of Directors)

Explanation:

(1) The Company's "Procedures for the Acquisition or Disposal of Assets", "Procedures for Engaging in Derivatives Trading", "Rules for Loaning of Funds" and "Rules for Endorsements/Guarantees" is amended in accordance with the Company's business requirements and establishment of the Audit Committee.
(2) Please refer to Attachment VI to IX on page 33-49 of the Handbook for the comparison table of revisions to the "Procedures for the Acquisition or Disposal of Assets", "Procedures for Engaging in Derivatives Trading", "Rules for Loaning of Funds" and "Rules for Endorsements/Guarantees"

Resolution:

Election of the Company's 18th-term of Directors (Proposed by the Board of Directors)

Explanation:

(1) The term of office of the Company's current Directors and Supervisors will expire on June 11, 2022 and an election for Directors is called for at this annual general shareholders' meeting.
(2) In accordance with corporate governance and the Securities and Exchange Act, the Audit Committee will replace the role of Supervisors, and in accordance with the revised "Articles of Incorporation", Supervisors will not be elected at this meeting.
(3) According to Article 16 of the Company's Articles of Incorporation, the Company shall elect nine Directors (including three Independent Directors). The Directors shall be elected based on a candidate nomination system for a term of three years.
(4) The term of office of the newly elected Directors will be from June 8, 2022 to June 7, 2025. The term of the previous Directors and Supervisors shall expire upon the completion of the annual general shareholders' meeting.
(5) The list of candidates for the Directors (including Independent Directors)

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has been resolved in the meeting of the Board of Directors on April 25, 2022, and is provided below;

Director Candidate	1	2	3	4	5	6
Name	Mao Yu Commemorate Co., Ltd.: Representative: En-Chou Lin	Mao Yu Commemorate Co., Ltd. Representative: En-PingLin	Chung-Jen Liang	Ming-Yuan Hsieh	You-Chih Huang	Chun-Ming Chen
Number of shares held	18,910,616 shares	18,910,616 shares	2,098,721 shares	3,606,585 shares	94,228 shares	119,446 shares
Education	Tamkang University Degree in Insurance and Banking	Dominican University Master of Business Administration,	National Chengchi University Degree in Finance	Feng Chia University Degree in Applied Mathematics	National Tsing Hua University Masters in Mechanical Engineering	Ohio State University PhD in Computer Science
Experience/Current Position	Largan Precision Director/Chairman	Largan Precision Director/CEO	Largan Precision Supervisor	Largan Precision Director	Largan Precision CTO	Largan Precision Assistant Manager

Independent Director Candidate	1	2	3
Name	Shan-Chieh Yen	Ming-Hua Peng	Chun-Yi Lu
Numberofsharesheld	None	56,604shares	None
Education	Taichung Industrial High School Electrical Engineering,	Ming Chi Institute of Technology Mechanical Engineering	Kuang Hwa High School of Technology Electronic Communication
Experience/Current Position	Largan Precision Assistant Vice President/Independent Director	Largan Precision Assistant Vice President/Independent Director	Largan Digital Vice President/None

Results of the election:

Proposal to release newly appointed Directors from non-compete restrictions. (Proposed by the Board of Directors)

Explanation:

(1) Pursuant to Article 209 of the Company Act, a Director who does anything for himself or on behalf of another person that is within the scope of the Company's business, shall explain to the meeting of shareholders the essential contents of such an act and secure its approval.
(2) To make use of the expertise and related experience of the Company's newly appointed Directors, it is proposed to the shareholders' meeting to release the Company’s newly appointed Directors from non-compete restrictions.
(3) Related information on the release of non-compete restrictions is as follows:

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Position	Name	Otherpositions held
Representative of Corporate Director	En-Chou Lin	Director,Largan Health TechnologyInc.
		Supervisor,Mao Yu Commemorate Co.,Ltd.
Representative of Corporate Director	En-Ping Lin	Chairman,Largan Digital Co.,Ltd.
		Chairman,Largan Medical Co.,Ltd.
		Director,Alpha HoldingIncorporated
		Director,Beta International Limited
		Director,Largan Health TechnologyInc.
		Representative of Corporate Director, Largan Health TechnologyCo.,Ltd.
		Director,Largan Health AI-Tech Co.,Ltd.
		Director,Mao Yu Commemorate Co.,Ltd.
Director	Chung-Jen Liang	Supervisor,Largan Digital Co.,Ltd.
		Supervisor,Largan Medical Co.,Ltd.
Director	You-Chih Huang	Representative of Corporate Director, PhotonicoreTechnologiesCo.,Ltd.

Resolution:

Extemporary Motions

Meeting Adjourned

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Attachment I

Largan Precision Co., Ltd.

2021 Business Report

In 2021, the Company's consolidated revenue amounted to NT$46,962,402 thousand and the net profit after tax amounted to NT$18,671,230 thousand. Our 2021 business results and 2022 business plan are summarized below:

2021 Business Report
(1) Business results: Largan Precision's consolidated revenue in 2021 amounted to NT$46,962,402 thousand, which was a 16% decline over NT$55,944,489 thousand in 2020. The net profit after tax was NT$18,671,230 thousand, which was a 24% decline over NT$24,534,131 thousand in 2020. The net profit per share after tax was NT$139.28.
(2) Financial performance and profitability: Please refer to the financial statements in the attachment for the financial overview of 2021.
(3) Research and development: The Company invested a total of NT$3,601,890 thousand in research and development for the current year, which was a 5% decline over NT$$3,794,356 thousand in the previous year.
2022 Business Plan
(1) Business strategy: Largan Precision upholds the business philosophy of "innovation, professionalism, speed, and flexibility" and all employees continuously pursue discipline and growth in the face of a changing business environment as they commit themselves to product development and quality improvement to continuously create profit and growth.
(2) Production and sales forecast: The Company shall remain focused on the production and sales of mobile phone camera lenses and actively enhance manufacturing technology and output with the aim of maintaining the Company's advantages in production cost, and making overall production and sales more competitive.
(3) Research and development plans: The Company shall continue to conduct research and development in mobile phone camera lenses. We shall continue to expand our R&D team, product range, add new product lines, and improve the scale and quality of products. We shall also commit ourselves to the development of other product applications and improvement in manufacturing capabilities to maintain long-term competitiveness in the industry.

Largan Precision shall continue to work hard and adopt a spirit of constant innovation in the production of each product. We shall fully develop the Company's core expertise and continue to strengthen the Company's competitiveness in all respects to live up to the expectations of the shareholders and the general public. We hereby express our most sincere gratitude for the support of all our customers, suppliers, shareholders, and employees.

Chairman: En-Chou Lin Chief Executive Officer: En-Ping Lin Chief Accounting Officer: Hsing-Ju Tsao

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Attachment II

Largan Precision Co., Ltd. Supervisors' Review Report

We hereby approve

The Company's 2021 Financial Statements (Parent Company Only Financial Statements and Consolidated Financial Statements) prepared and delivered by the Board of Directors have been audited by KPMG Taiwan who found them to be reasonably expressed to present the financial status, business performance, and cash flow of the Company. The Supervisors have reviewed and verified the Financial Statements along with the Business Report and earnings distribution proposal and found them to be compliant with applicable regulations. We hereby produce this report in accordance with Article 219 of the Company Act for your review.

The above is respectfully submitted to

Largan Precision 2022 Annual General Shareholders' Meeting

Largan Precision Co., Ltd.

Supervisors: Chung-Jen Liang

Tsui-Ying Chiang

Date: February 21[st] , 2022

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Attachment III

Independent Auditors’ Report

To the Board of Directors of Largan Precision Co., Ltd.:

Opinion

We have audited the financial statements of Largan Precision Co., Ltd. (the ”Company”) which comprise the balance sheets as of December 31, 2021 and 2020, the statement of comprehensive income, changes in equity and cash flows for the years ended December 31, 2021 and 2020, and notes to the parent company only financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying parent company only financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and its financial performance and its cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Basis for Opinion

We conducted our audit in accordance with the Regulations Governing Auditing and Certification of Financial Statements by Certified Public Accountants and the auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the parent company only Financial Statements section of our report. We are independent of the Company in accordance with the Certified Public Accountants Code of Professional Ethics in Republic of China (“the Code”), and we have fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis of our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the parent company only financial statements of the current period. 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. We have determined the matters described below to be the key audit matters to be communicated in our report.

Inventory valuation

Please refer to Note 4(g), Note 5, and Note 6(f) for accounting policies, uncertainty of accounting estimates and assumptions, and related disclosures for inventory valuation.

Description of key audit matter:

Inventories are stated at the lower of cost or net realizable value. With the rapid development of technology, and significant changes in market demand, the severe volatility to sales may lead to risks, wherein the costs of inventories may exceed its net realizable values. Therefore, the valuation of inventories has been identified as one of the key audit matters.

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How the matter was addressed in our audit:

In relation to the key audit matter above, our principal audit procedures include obtaining an inventory aging report, analyzing the movement of inventory aging and evaluating the reasonableness of the Company’ s accounting policies, such as allowance for inventory valuation and obsolescence; performing a retrospective test of the Company’s historical accuracy of judgments with reference to inventory valuation and comparing with the current period to evaluate the appropriateness of the estimation and assumptions used; examining whether the valuation of inventories is in compliance with the accounting policies of the Company; understanding the basis of the selling price the management used to ensure the reasonableness of net realizable value of inventories; reviewing sales in the subsequent period, as well as assessing the basis of the net realizable value the Company used to determine the sufficiency of allowance of inventories and whether the related disclosures are appropriate.

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 Regulations Governing the Preparation of Financial Reports by Securities Issuers and with the IFRSs, IASs, IFRC, SIC endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China, and for such internal control as management determines is necessary to enable the preparation of parent company only financial statements that are free from material misstatement, whether due to fraud or error.

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

Those charged with governance (including the supervisors) are responsible for overseeing the Company’ s financial reporting process.

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Auditor’s Responsibilities for the Audit of the Parent Company Only 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 auditing standards generally accepted in the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these parent company only financial statements.

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

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient and appropriate audit evidence regarding the financial information on the investment in other entities accounted for using the equity method in order to express an opinion on this financial statements. We are responsible for the direction, supervision and performance of the 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.

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From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the parent company only financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors’ 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.

The engagement partners on the audit resulting in this independent auditors’ report are Shyh-Huar, Kuo and Chun-Yuan, Wu.

KPMG

Taipei, Taiwan (Republic of China) February 21, 2022

Notes to Readers

The accompanying parent company only financial statements are intended only to present the statement of financial position, financial performance and cash flows in accordance with the 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 parent company only financial statements are those generally accepted and applied in the Republic of China.

The independent auditors’ report and the accompanying parent company only financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ report and parent company only financial statements, the Chinese version shall prevail.

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				December 31, 2020	Amount %		249,535 -	873 -	1,454,301 1	715,194 -	21,811,109 13	- -	10,147 -	6,133,020 4	43,401 -	144,041 -	30,561,621 18		8,692 -	123,164 -	3,766 -	109,269 -	244,891 -	30,806,512 18		1,341,402 1	1,560,586 1	139,645,983 81	(1,745,813) (1)	- -	140,802,158 82	171,608,670 100
				December 31, 2021	Amount %		$ - -	1,557 -	1,291,834 1	1,261,921 1	22,033,619 13	4,158,346 2	7,561 -	4,383,648 2	46,555 -	91,308 -	33,276,349 19		15,131 -	108,024 -	3,630 -	99,993 -	226,778 -	33,503,127 19		1,341,402 1	1,562,914 1	141,877,661 81	(1,641,270) (1)	(1,400,985) (1)	141,739,722 81	$ 175,242,849 100
LARGAN PRECISION CO., LTD.	Balance Sheets	December 31, 2021 and 2020	(Expressed in Thousands of New Taiwan Dollars)	December 31, 2021 December 31, 2020	Assets Amount % Amount % Liabilities and Equity	Current assets: Current liabilities:	Cash and cash equivalents (Note 6(a) and (v)) $ 77,792,072 45 78,789,365 46 2100 Short-term borrowings (Note 6(l) and (v))	Current financial assets at fair value through profit or loss (Note 6(b) and (v)) 14,329,966 8 13,207,411 8 2150 Notes payable (Note 6(v))	Current financial assets at fair value through other comprehensive income 2170 Accounts payable (Note 6(v))	(Note 6(c) and (v)) 2,354,263 1 41,470 - 2180 Accounts payable to related parties (Note 6(v) and 7)	Notes receivable, net (Note 6(d) and (v)) - - 590 - 2200 Other payables (Note 6(p) and (v))	Accounts receivable, net (Note 6(d) and (v)) 5,126,249 3 3,180,333 2 2216 Dividends payable (Note 6(q) and (v))	Accounts receivable from related parties, net (Note 6(d), (v) and 7) 4,025,551 2 6,203,908 4 2220 Other payables to related parties (Note 6(v) and 7)	Other receivables (Note 6(e) and (v)) 286,304 - 263,429 - 2230 Current tax liabilities	Other receivables from related parties (Note 6(e), (v) and 7) 110,996 - 59,578 - 2280 Current lease liabilities (Note 6(m) and (v))	Inventories (Note 6(f)) 4,641,165 3 3,694,824 2 2300 Other current liabilities	Other current assets (Note6(k)) 222,479 - 1,012,857 -	Other current financial assets (Note 6(k), (v) and 8) 2,257,576 1 9,000 - Non-Current liabilities:	111,146,621 63 106,462,765 62 2570 Deferred tax liabilities (Note 6(o))	Non-current assets: 2580 Non-current lease liabilities (Note 6(m) and (v))	Non-current financial assets at fair value through other comprehensive income 2600 Other non-current liabilities (Note 6(v))	(Note 6(c) and (v)) 932,000 1 - - 2640 Net defined benefit liabilities (Note 6(n))	Investments accounted for using equity method (Note 6(g)) 14,453,422 8 13,802,157 8	Property, plant and equipment (Note 6(h) and 7) 34,650,808 20 33,542,417 20 Total liabilities	Right-of-use assets (Note 6(i)) 155,128 - 167,766 - Equity attributable to owners of parent: (Note 6(q))	Intangible assets (Note 6(j)) 69,799 - 112,794 - 3110 Share capital	Deferred tax assets (Note 6(o)) 762,515 - 509,269 - 3200 Capital surplus	Other non-current assets (Note 6(k), (v) and 8) 1,892,029 1 1,840,940 1 3300 Retained earnings	Other non-current financial assets (Note 6(k), (v) and 8) 11,180,527 7 15,170,562 9 3400 Other equity interest	64,096,228 37 65,145,905 38 3500 Treasury shares	Total assets $ 175,242,849 100 171,608,670 100 Total equity attributable to owners of parent Total liabilities and equity
							1100	1110	1120		1150	1170	1180	1200	1210	1310	1470	1476			1520		1550	1600	1755	1780	1840	1900	1980

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(English Translation of Parent Company Only Financial Statements and Report Originally Issued in Chinese) LARGAN PRECISION CO., LTD.

Statements of Comprehensive Income

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars , Except for Earnings Per Common Share)

4000 Operating revenues (Note 6(s) and 7) 5000 Operating costs (Note 6(f), (n), (t) and 7) 5910 Realized (unrealized) profit from sales 5900 Gross profit from operations 6000 Operating expenses (Note 6(n), (t) and 7): 6100 Selling expenses 6200 Administrative expenses 6300 Research and development expenses Total operating expenses 6900 Operating income 7000 Non-operating income and expenses: 7100 Interest income (Note 6(u)) 7010 Other income (Note 6(u) and 7) 7020 Other gains and losses (Note 6(u) and 7) 7050 Finance costs (Note 6(m) and (u)) 7060 Share of profit (losses) of associates accounted for using equity method 7900 Profit before income tax 7950 Less: Income tax expenses (Note 6(o)) Profit for the period 8300 Other comprehensive income: 8310 Components of other comprehensive income that will not be reclassified to profit or loss 8311 Remeasurements of defined benefit obligation 8316 Unrealized losses on investments in equity instruments measured at fair value through other comprehensive income 8349 Income tax related to components of other comprehensive income that will not be reclassified to profit or loss 8360 Components of other comprehensive income that will be reclassified to profit or loss 8361 Exchange differences on translation of foreign financial statements 8399 Income tax related to components of other comprehensive income that will be reclassified to profit or loss Other comprehensive income (loss) for the period, net of tax 8500 Total comprehensive income for the period Earnings per share (NT Dollars) (Note 6(r)) 9750 Basic earnings per share 9850 Diluted earnings per share	2021 Amount % $ 47,033,940 100 19,502,569 41 27,531,371 59 (465,441) (1) 27,065,930 58 306,624 1 1,008,281 2 3,598,488 8 4,913,393 11 22,152,537 47 827,408 2 50,975 - (1,267,144) (2) (1,909) - 1,079,876 2 689,206 2 22,841,743 49 4,170,513 9 18,671,230 40 (7,378) - 344,093 1 - - 336,715 1 (239,550) (1) - - (239,550) (1) 97,165 - $ 18,768,395 40 $ 139.28 $ 137.49	2020 Amount % 53,979,503 100 18,370,185 34 35,609,318 66 251,075 - 35,860,393 66 336,833 - 1,228,094 2 3,791,346 7 5,356,273 9 30,504,120 57 1,035,231 1 47,331 - (1,708,009) (3) (2,323) - 1,600,362 3 972,592 1 31,476,712 58 6,942,581 13 24,534,131 45 (6,134) - 160,404 - - - 154,270 - 314,394 1 - - 314,394 1 468,664 1 25,002,795 46 182.90 180.94

See accompanying notes to parent company only financial statements.

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														Total equity	126,393,911		-	-	(10,597,076)	(10,597,076)	2,528	24,534,131	468,664	25,002,795		-	140,802,158	140,802,158		-	-	(16,432,174)	(16,432,174)	2,328	18,671,230	97,165	18,768,395	(1,400,985)	141,739,722
													Treasury	shares	-		-	-	-	-	-	-	-	-		-	-	-		-	-	-	-	-	-	-	-	(1,400,985)	(1,400,985)
														Total	(2,141,576)		-	-	-	-	-	-	474,798	474,798		(79,035)	(1,745,813)	(1,745,813)		-	-	-	-	-	-	104,543	104,543	-	(1,641,270)
(English Translation of Parent Company Only Financial Statements and Report Originally Issued in Chinese)	LARGAN PRECISION CO., LTD.	Statements of Changes in Equity	For the years ended December 31, 2021 and 2020	(Expressed in Thousands of New Taiwan Dollars)	Other equity interest	Retained earnings Unrealized	gains	(losses) on	Exchange financial assets	differences on measured at	translation of fair value	Unappropriated foreign through other	Share Capital Legal Special retained financial comprehensive	Capital surplus reserve reserve earnings Total statements income	1,341,402 1,558,058 16,019,773 1,802,464 107,813,790 125,636,027 (2,061,631) (79,945)		- - 2,826,308 - (2,826,308) - - -	- - - 339,112 (339,112) - - -	- - - - (10,597,076) (10,597,076) - -	- - 2,826,308 339,112 (13,762,496) (10,597,076) - -	- 2,528 - - - - - -	- - - - 24,534,131 24,534,131 - -	- - - - (6,134) (6,134) 314,394 160,404	- - - - 24,527,997 24,527,997 314,394 160,404		- - - - 79,035 79,035 - (79,035)	1,341,402 1,560,586 18,846,081 2,141,576 118,658,326 139,645,983 (1,747,237) 1,424	1,341,402 1,560,586 18,846,081 2,141,576 118,658,326 139,645,983 (1,747,237) 1,424		- - 3,288,222 - (3,288,222) - - -	- - - (620,194) 620,194 - - -	- - - - (16,432,174) (16,432,174) - -	- - 3,288,222 (620,194) (19,100,202) (16,432,174) - -	- 2,328 - - - - - -	- - - - 18,671,230 18,671,230 - -	- - - - (7,378) (7,378) (239,550) 344,093	- - - - 18,663,852 18,663,852 (239,550) 344,093	- - - - - - - -	1,341,402 1,562,914 22,134,303 1,521,382 118,221,976 141,877,661 (1,986,787) 345,517
															$												$	$											$
															Balance at January 1, 2020	Appropriation and distribution of retained earnings:	Legal reserve	Special reserve	Cash dividends of common stock		Other changes in capital surplus	Profit for the period	Other comprehensive income for the period	Total comprehensive income for the period	Subsidiary disposes of investment in equity instruments measured	at fair value through other comprehensive income	Balance at December 31, 2020	Balance at January 1, 2021	Appropriation and distribution of retained earnings:	Legal reserve	Special reserve	Cash dividends of common stock		Other changers in capital surplus	Profit for the period	Other comprehensive income for the period	Total comprehensive income for the period	Purchase of treasury shares	Balance at December 31, 2021

-17-

(English Translation of Parent Company Only Financial Statements and Report Originally Issued in Chinese) LARGAN PRECISION CO., LTD.

Statements of Cash Flows

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from operating activities: Profit before income tax Adjustments: Adjustments to reconcile profit (loss): Depreciation expense Amortization expense Interest expense Interest income Share of profit of subsidiaries accounted for using equity method (Profit) losses on disposal of property, plant and equipment Unrealized (realized) profit from sales Unrealized foreign exchange loss Other Total adjustments to reconcile profit Changes in operating assets and liabilities: Changes in operating assets: Increase in financial assets mandatorily measured at fair value through profit or loss Decrease in notes receivable Decrease in accounts receivable (including from related parties) Increase in inventories Decrease (increase) in other current assets Total changes in operating assets Changes in operating liabilities: Increase in notes payable Increase (decrease) in accounts payable (including to related parties) Increase in other current liabilities Decrease in net defined benefit liabilities Total changes in operating liabilities Total changes in operating assets and liabilities Cash inflow generated from operations Interest received Interest paid Income taxes paid Net cash flows from operating activities Cash flows from investing activities: Acquisition of financial assets at fair value through other comprehensive income Acquisition of investments accounted for using equity method Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Decrease (increase) in refundable deposits (Increase) decrease in other non-current assets Acquisition of intangible assets Acquisition of right-of-use assets Decrease (increase) in other financial assets Dividends received Net cash flows used in investing activities Cash flows from financing activities: (Decrease) increase in short-term borrowings Decrease in guarantee deposits received Payment of lease liabilities Cash dividend paid Payments to acquire treasury shares Overdue dividend transferred to capital surplus Net cash flows used in financing activities Net (decrease) increase in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	2021 $ 22,841,743 4,600,159 95,046 1,909 (827,408) (1,079,876) (3,992) 465,441 3,504 (900) 3,253,883 (1,122,555) 590 232,441 (946,341) 706,898 (1,128,967) 684 384,260 315,718 (16,654) 684,008 (444,959) 25,650,667 837,976 (1,909) (6,181,930) 20,304,804 (2,916,273) (274,600) (5,844,120) 59,015 617,474 (668,563) (47,030) (410) 1,741,459 - (7,333,048) (252,007) (136) (44,421) (12,273,828) (1,400,985) 2,328 (13,969,049) (997,293) 78,789,365 $ 77,792,072	2020 31,476,712 4,205,548 85,266 2,323 (1,035,231) (1,600,362) 6,731 (251,075) 10,099 (1,460) 1,421,839 (6,139,558) 2,520 5,171,372 (494,076) (42,553) (1,502,295) 171 (109,385) 1,505,945 (2,714) 1,394,017 (108,278) 32,790,273 1,001,121 (2,323) (5,155,726) 28,633,345 - - (5,773,541) 1,551 (1,841) 326,030 (91,871) - (8,747,667) 12,117,060 (2,170,279) 23,619 (730) (40,734) (10,597,076) - 2,528 (10,612,393) 15,850,673 62,938,692 78,789,365

See accompanying notes to parent company only financial statements.

-18-

Independent Auditors’ Report

To the Board of Directors of Largan Precision Co., Ltd.:

Opinion

We have audited the consolidated financial statements of Largan Precision Co., Ltd. (the ”Company”) and its subsidiaries (the” Group”), which comprise the consolidated balance sheets as of December 31, 2021 and 2020, the consolidated statement of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2021 and 2020, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and with the International Financial Reporting Standards (“IFRSs”), International Accounting Standards (“IASs”), Interpretations developed by the International Financial Reporting Interpretations Committee (“IFRIC”) or the former Standing Interpretations Committee (“SIC”) endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

Basis for Opinion

We conducted our audit in accordance with the Regulations Governing Auditing and Certification of Financial Statements by Certified Public Accountants and the auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with the Certified Public Accountants Code of Professional Ethics in Republic of China (“ the Code”), and we have fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis of our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. 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. We have determined the matters described below to be the key audit matters to be communicated in our report.

Inventory valuation

Please refer to Note 4(h), Note 5, and Note 6(f) for accounting policies, uncertainty of accounting estimates and assumptions, and related disclosures for inventory valuation.

-19-

Description of key audit matter:

How the matter was addressed in our audit:

In relation to the key audit matter above, our principal audit procedures include obtaining an inventory aging report, analyzing the movement of inventory aging and evaluating the reasonableness of the Group’ s accounting policies, such as allowance for inventory valuation and obsolescence; performing a retrospective test of the Group’s historical accuracy of judgments with reference to inventory valuation and comparing with the current period to evaluate the appropriateness of the estimation and assumptions used; examining whether the valuation of inventories is in compliance with the accounting policies of the Group; understanding the basis of the selling price the management used to ensure the reasonableness of net realizable value of inventories; reviewing sales in the subsequent period, as well as assessing the basis of the net realizable value the Group used to determine the sufficiency of allowance of inventories and whether the related disclosures are appropriate.

Other Matter

The Company has additionally prepared its parent company only financial statements as of and for the years ended December 31, 2021 and 2020, on which we have issued an unqualified opinion.

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

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

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

Those charged with governance (including the supervisors) are responsible for overseeing the Group’s financial reporting process.

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 auditing standards generally accepted in the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

-20-

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

-21-

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors’ 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.

The engagement partners on the audit resulting in this independent auditors’ report are Shyh-Huar, Kuo and Chun-Yuan, Wu.

KPMG

Taipei, Taiwan (Republic of China) February 21, 2022

Notes to Readers

The accompanying consolidated financial statements are intended only to present the consolidated statement of financial position, financial performance and cash flows in accordance with the 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.

The independent auditors’ report and the accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ report and consolidated financial statements, the Chinese version shall prevail.

-22-

					December 31, 2020	Amount %		249,535 -	873 -	1,567,850 1	32,460 -	22,024,514 13	- -	9,331 -	6,156,182 4	43,401 -	145,035 -	30,229,181 18		8,692 -	123,164 -	3,766 -	109,269 -	244,891 -	30,474,072 18			1,341,402 1	1,560,586 1	139,645,983 81	(1,745,813) (1)	- -	140,802,158 82	171,276,230 100
					December 31, 2021	Amount %		$ - -	1,557 -	1,472,075 1	205,220 -	22,321,915 13	4,158,346 2	7,130 -	4,424,489 3	50,492 -	92,122 -	32,733,346 19		15,131 -	119,058 -	3,630 -	99,993 -	237,812 -	32,971,158 19			1,341,402 1	1,562,914 1	141,877,661 81	(1,641,270) (1)	(1,400,985) (1)	141,739,722 81	$ 174,710,880 100
(English Translation of Consolidated Financial Statements and Report Originally Issued in Chinese)	LARGAN PRECISION CO., LTD. AND SUBSIDIARIES	Consolidated Balance Sheets	December 31, 2021 and 2020	(Expressed in Thousands of New Taiwan Dollars)	December 31, 2021 December 31, 2020	Assets Amount % Amount % Liabilities and Equity	Current assets: Current liabilities:	Cash and cash equivalents (Note 6(a) and (v)) $ 89,149,294 51 89,621,272 52 2100 Short-term borrowings (Note 6(l) and (v))	Current financial assets at fair value through profit or loss(Note 6(b) and (v)) 14,369,966 8 13,207,411 8 2150 Notes payable (Note 6(v))	Current financial assets at fair value through other comprehensive income 2170 Accounts payable (Note 6(v))	(Note 6(c) and (v)) 2,354,263 2 41,470 - 2180 Accounts payable to related parties (Note 6(v) and 7)	Notes receivable, net (Note 6(d) and (v)) - - 9,345 - 2200 Other payables (Note 6(p) and (v))	Accounts receivable, net (Note 6(d) and (v)) 9,870,974 6 11,149,800 7 2216 Dividends payable (Note 6(q) and (v))	Accounts receivable from related parties, net (Note 6(d), (v) and 7) 67,449 - 6,960 - 2220 Other payables to related parties (Note 6 (v) and 7)	Other receivables (Note 6(e) and (v)) 315,421 - 285,842 - 2230 Current tax liabilities	Other receivables from related parties (Note 6(e), (v) and 7) 17,713 - 26,660 - 2280 Current lease liabilities (Note 6 (m) and (v))	Current tax assets 6 - - - 2300 Other current liabilities	Inventories (Note 6(f)) 5,707,545 3 4,026,420 2	Other current assets (Note 6 (k)) 225,673 - 1,015,091 1 Non-Current liabilities:	Other current financial assets(Note6(k), (v) and8) 2,258,576 1 9,000 - 2570 Deferred tax liabilities (Note 6(o))	124,336,880 71 119,399,271 70 2580 Non-current lease liabilities (Note 6(m) and (v))	Non-current assets: 2600 Other non-current liabilities (Note 6(v))	Non-current financial assets at fair value through other comprehensive 2640 Net defined benefit liabilities (Note 6(n))	income(Note 6(c) and (v)) 932,000 1 - -	Investments accounted for using equity method (Note 6(g)) 439,212 - 272,601 - Total liabilities	Property, plant and equipment (Note 6(h) and 7) 34,914,941 20 33,790,608 20 Equity:	Right-of-use assets (Note 6(i)) 181,939 - 180,185 - Equity attributable to owners of parent: (Note 6(q))	Intangible assets (Note 6(j)) 69,799 - 112,794 - 3110 Share capital	Deferred tax assets (Note 6(o)) 762,515 - 509,269 - 3200 Capital surplus	Other non-current assets (Note 6(k), (v) and 8) 1,893,067 1 1,840,940 1 3300 Retained earnings	Other non-current financial assets (Note 6(k), (v) and 8) 11,180,527 7 15,170,562 9 3400 Other equity interest	50,374,000 29 51,876,959 30 3500 Treasury shares	Total assets $ 174,710,880 100 171,276,230 100 Total equity attributable to owners of parent Total liabilities and equity
								1100	1110	1120		1150	1170	1180	1200	1210	1220	1310	1470	1476			1520		1550	1600	1755	1780	1840	1900	1980

-23-

(English Translation of Consolidated Financial Statements and Report Originally Issued in Chinese) LARGAN PRECISION CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars , Except for Earnings Per Common Share)

4000 Operating revenues (Note 6(s) and 7) 5000 Operating costs (Note 6(f), (n), (t) and 7) 5920 Realized profit from sales 5900 Gross profit from operations 6000 Operating expenses (Note 6(n), (t) and 7): 6100 Selling expenses 6200 Administrative expenses 6300 Research and development expenses Total operating expenses 6900 Operating income 7000 Non-operating income and expenses: 7100 Interest income (Note 6(u)) 7010 Other income (Note 6(u) and 7) 7020 Other gains and losses (Note 6(u) and 7) 7050 Finance costs (Note 6(m) and (u)) 7060 Share of profit (losses) of associates accounted for using equity method, net (Note 6(g)) 7900 Profit before income tax 7950 Less: Income tax expenses (Note 6(o)) Profit for the period 8300 Other comprehensive income: 8310 Components of other comprehensive income that will not be reclassified to profit or loss 8311 Remeasurements of defined benefit obligation 8316 Unrealized losses on investments in equity instruments measured at fair value through other comprehensive income 8349 Income tax related to components of other comprehensive income that will not be reclassified to profit or loss 8360 Components of other comprehensive income that will be reclassified to profit or loss 8361 Exchange differences on translation of foreign financial statements 8399 Income tax related to components of other comprehensive income that will be reclassified to profit or loss Other comprehensive income for the period, net of tax 8500 Total comprehensive income for the period Earnings per share (NT Dollars) (Note 6(r)) 9750 Basic earnings per share 9850 Diluted earnings per share	2021 Amount % $ 46,962,402 100 18,813,768 40 28,148,634 60 1,017 - 28,149,651 60 369,013 1 1,030,627 2 3,601,890 8 5,001,530 11 23,148,121 49 950,551 2 31,241 - (1,250,565) (2) (1,947) - 149,209 - (121,511) - 23,026,610 49 4,355,380 9 18,671,230 40 (7,378) - 344,093 1 - - 336,715 1 (239,550) (1) - - (239,550) (1) 97,165 - $ 18,768,395 40 $ 139.28 $ 137.49	2020 Amount % 55,944,489 100 18,476,853 33 37,467,636 67 4,598 - 37,472,234 67 399,738 1 1,246,022 2 3,794,356 7 5,440,116 10 32,032,118 57 1,304,977 3 27,394 - (1,708,987) (3) (2,323) - 40,588 - (338,351) - 31,693,767 57 7,159,636 13 24,534,131 44 (6,134) - 160,404 - - - 154,270 - 314,394 1 - - 314,394 1 468,664 1 25,002,795 45 182.90 180.94

See accompanying notes to consolidated financial statements.

-24-

												Total equity	attributable to	owners of	parent	126,393,911		-	-	(10,597,076)	(10,597,076)	2,528	24,534,131	468,664	25,002,795		-	140,802,158	140,802,158		-	-	(16,432,174)	(16,432,174)	2,328	18,671,230	97,165	18,768,395	(1,400,985)	141,739,722
														Treasury	shares	-		-	-	-	-	-	-	-	-		-	-	-		-	-	-	-	-	-	-	-	(1,400,985)	(1,400,985)
															Total	(2,141,576)		-	-	-	-	-	-	474,798	474,798		(79,035)	(1,745,813)	(1,745,813)		-	-	-	-	-	-	104,543	104,543	-	(1,641,270)
(English Translation of Consolidated Financial Statements and Report Originally Issued in Chinese)	LARGAN PRECISION CO., LTD. AND SUBSIDIARIES	Consolidated Statements of Changes in Equity	For the years ended December 31, 2021 and 2020	(Expressed in Thousands of New Taiwan Dollars)	Equity attributable to owners of parent	Other equity interest	Retained earnings Unrealized	gains	(losses) on	Exchange financial assets	differences on measured at	translation of fair value	Unappropriated foreign through other	Share Capital Legal Special retained financial comprehensive	Capital surplus reserve reserve earnings Total statements income	1,341,402 1,558,058 16,019,773 1,802,464 107,813,790 125,636,027 (2,061,631) (79,945)		- - 2,826,308 - (2,826,308) - - -	- - - 339,112 (339,112) - - -	- - - - (10,597,076) (10,597,076) - -	- - 2,826,308 339,112 (13,762,496) (10,597,076) - -	- 2,528 - - - - - -	- - - - 24,534,131 24,534,131 - -	- - - - (6,134) (6,134) 314,394 160,404	- - - - 24,527,997 24,527,997 314,394 160,404		- - - - 79,035 79,035 - (79,035)	1,341,402 1,560,586 18,846,081 2,141,576 118,658,326 139,645,983 (1,747,237) 1,424	1,341,402 1,560,586 18,846,081 2,141,576 118,658,326 139,645,983 (1,747,237) 1,424		- - 3,288,222 - (3,288,222) - - -	- - - (620,194) 620,194 - - -	- - - - (16,432,174) (16,432,174) - -	- - 3,288,222 (620,194) (19,100,202) (16,432,174) - -	- 2,328 - - - - - -	- - - - 18,671,230 18,671,230 - -	- - - - (7,378) (7,378) (239,550) 344,093	- - - - 18,663,852 18,663,852 (239,550) 344,093	- - - - - - - -	1,341,402 1,562,914 22,134,303 1,521,382 118,221,976 141,877,661 (1,986,787) 345,517
																$												$	$											$
																Balance at January 1, 2020	Appropriation and distribution of retained earnings:	Legal reserve	Special reserve	Cash dividends of common stock		Other changes in capital surplus	Profit for the period	Other comprehensive income for the period	Total comprehensive income for the period	Disposal of investments in equity instruments designated at fair	value through other comprehensive income	Balance at December 31, 2020	Balance at January 1, 2021	Appropriation and distribution of retained earnings:	Legal reserve	Special reserve	Cash dividends of common stock		Other changes in capital surplus	Profit for the period	Other comprehensive income for the period	Total comprehensive income for the period	Purchase of treasury share	Balance at December 31, 2021

-25-

(English Translation of Consolidated Financial Statements and Report Originally Issued in Chinese) LARGAN PRECISION CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

2021
Cash flows from operating activities:
Profit before income tax
$ 23,026,610
Adjustments:
Adjustments to reconcile profit (loss):
Depreciation expense
4,649,925
Amortization expense
95,046
Interest expense
1,947
Interest income
(950,551)
Share of profit of associates accounted for using equity method
(149,209)
(Profit) losses on disposal of property, plant and equipment
(3,992)
Unrealized foreign exchange loss
3,498
Realized profit from sales
(1,017)
Other
(900)
Total adjustments to reconcile profit
3,644,747
Changes in operating assets and liabilities:
Changes in operating assets:
Increase in financial assets mandatorily measured at fair value through profit or loss
(1,162,555)
Decrease in notes receivable
9,345
Decrease in accounts receivable (including from related parties)
1,218,337
Increase in inventories
(1,681,125)
Decrease (increase) in other current assets
762,674
Total changes in operating assets
(853,324)
Changes in operating liabilities:
Increase in notes payable
684
Increase in accounts payable (including to related parties)
76,985
Increase in other current liabilities
391,773
Decrease in net defined benefit liabilities
(16,654)
Total changes in operating liabilities
452,788
Total changes in operating assets and liabilities
(400,536)
Cash inflow generated from operations
26,270,821
Interest received
958,044
Interest paid
(1,947)
Income taxes paid
(6,349,124)
Net cash flows from operating activities
20,877,794
Cash flows from investing activities:
Acquisition of financial assets at fair value through other comprehensive income
(2,916,273)
Proceeds from disposal of financial assets at fair value through other comprehensive income
-
Acquisition of investments accounted for using equity method
(17,600)
Acquisition of property, plant and equipment
(5,909,190)
Proceeds from disposal of property, plant and equipment
59,015
Decrease (increase) in refundable deposits
616,436
(Increase) decrease in other non-current assets
(668,563)
Acquisition of intangible assets
(47,030)
Acquisition of right-of-use assets
(410)
Decrease (increase) in other financial assets
1,740,459
Net cash flows used in investing activities
(7,143,156)
Cash flows from financing activities:
(Decrease) increase in short-term borrowings
(252,007)
Decrease in guarantee deposits received
(136)
Payment of lease liabilities
(45,400)
Cash dividend paid
(12,273,828)
Payments to acquire treasury shares
(1,400,985)
Overdue dividend transferred to capital surplus
2,328
Net cash flows used in financing activities
(13,970,028)
Effect of exchange rate changes on cash and cash equivalents
(236,588)
Net (decrease) increase in cash and cash equivalents
(471,978)
Cash and cash equivalents at beginning of period
89,621,272
Cash and cash equivalents at end of period
$
89,149,294

2020
31,693,767
4,258,933
85,266
2,323
(1,304,977)
(40,588)
6,792
10,099
(4,598)
(1,460)
3,011,790
(6,139,558)
8,316
4,046,814
(395,318)
(684,632)
(3,164,378)
171
110,795
1,561,454
(2,714)
1,669,706
(1,494,672)
33,210,885
1,327,922
(2,323)
(5,485,787)
29,050,697
-
223,673
-
(5,770,667)
1,672
(1,841)
328,830
(91,871)
-
(8,747,667)
(14,057,871)
23,619
(730)
(40,734)
(10,597,076)
-
2,528
(10,612,393)
320,279
4,700,712
84,920,560
89,621,272

See accompanying notes to consolidated financial statements.

-26-

Attachment IV

Largan Precision Co., Ltd. 2021 Earnings Distribution Table

	Unit: NT$	Unit: NT$
Item	Amount
	Subtotal	Total
Opening balance		104,319,557,783
Less: Remeasurements of defined benefit plans	(7,377,713)
Plus: Reversal of special reserve
Reversal in first half of 2021	224,431,221
Difference for the year	(119,888,162)
Plus: Net income after tax for the current year	18,671,229,872
Earnings available for distribution
		123,087,953,001


Less: Appropriation for legal reserve
Amount appropriated in first half of 2021	(827,519,422)
Difference for the year	(1,038,865,794)
Distribution items:
Less: Shareholders’ dividends- cash (Note1)
Earnings distribution resolved for first half of 2021($31.15608212per share)	(4,158,346,107)
Earnings distribution resolved for second half of 2021($39per share)	(5,205,259,683)
Unappropriated retained earnings at the
		111,857,961,995
end of theperiod

Note1: Total cash dividend calculated based on total outstanding 133,468,197 shares after deduction of share repurchase.

Note2: The Company’s 2021 earnings shall be distributed first.

Chairman: En-Chou Lin Chief Executive Officer: En-Ping Lin Chief Accounting Officer: Hsing-Ju Tsao

-27-

Attachment V

Largan Precision Co., Ltd. Comparison Table of Revisions to the "Articles of Incorporation"

Before Revision	Before Revision	After Revision	After Revision	Explanation
Article 6: The Company's share certificates shall be name bearing, and registered, signed or sealed by the~~Chairman of the Board and~~ ~~at least two~~Directors. The share certificates~~shall be affixed with the~~ ~~Company's logo, numbered, and issued~~ ~~after certification by the competent~~ ~~authority.~~ (Omitted)		Article 6: The Company's share certificates shall be name bearing, and registered, signed or sealed by the Director representative of the Company. The share certificatesshall be issued after certification by banks competent to serve as attesters for the issuance of share certificates. (Omitted)		Revised in accordance with Article 162 of the Company Act.
Article 10 Shareholders’ meeting shall be of two types: general meetings and special meetings. General shareholders’ meetings are convened annually within six months after the end of each fiscal year. Special meetings shall be convened according to the law when necessary. The notice for convening a shareholders' meeting shall be given to each shareholders 30 days before a general meeting and 15 days before a special meeting. The date, location, and purpose of the meeting shall be notified to all shareholders. The notices for the shareholders' meeting prescribed in the preceding paragraph may be distributed in electronic form, subject to agreement by the recipient thereof.		Article 10 Shareholders’ meeting shall be of two types: general meetings and special meetings. General shareholders’ meetings are convened annually within six months after the end of each fiscal year. Special meetings shall be convened according to the law when necessary. The notice for convening a shareholders' meeting shall be given to each shareholders 30 days before a general meeting and 15 days before a special meeting. The date, location, and purpose of the meeting shall be notified to all shareholders. The notices for the shareholders' meeting prescribed in the preceding paragraph may be distributed in electronic form, subject to agreement by the recipient thereof. The Company’s shareholders’ meetings can be held by video conference or other methods announced by the central competent authority.		Revised in accordance with Article 172-2 of the Company Act.
		authority.
Chapter 4 Directors and	~~Supervisors~~	Chapter 4 Directors and Committee	Audit	Revised in accordance with establishment of the Audit Committee to replace the role of Supervisors.
Article 16 The Company shall have seven to nine Directors~~and two to three Supervisors~~		Article 16 The Company shall have seven to nine Directors. The term of office for		Revised in accordance with

-28-

Before Revision	After Revision	Explanation
~~elected at the shareholders' meeting from~~ ~~any individual with legal capacity~~. The term of office for Director~~s and~~ ~~Supervisors~~shall be three years and all shall be eligible for re-election. The total proportion of shares held by all Directors ~~and Supervisors o~~f the Company shall be subject to regulations prescribed by the securities authority. The Company shall have, among the aforementioned Directors, at leas~~t two~~ independent Director~~s, and the number of~~ ~~Independent Directors shall not be less~~ ~~than one-fifth of the total number of~~ ~~Directors~~. The Company's Directors~~and~~ ~~Supervisors s~~hall be elected by the shareholders from among the nominees listed in the roster of candidates based on a candidate nomination system. The "Directors" referred to in these Articles of Incorporation include Independent Directors. The candidate nomination system shall be implemented in accordance with Article 192-1~~and Article 216-1~~of the Company Act.	Directors shall be three years and all shall be eligible for re-election. The total proportion of shares held by all Directors of the Company shall be subject to regulations prescribed by the securities authority. The Company shall have, among the aforementioned Directors, at least threeindependent Directors. The Company's Directors shall be elected by the shareholders from among the nominees listed in the roster of candidates based on a candidate nomination system. The "Directors" referred to in these Articles of Incorporation include Independent Directors. The candidate nomination system shall be implemented in accordance with Article 192-1 of the Company Act.	establishment of the Audit Committee
Article 16-1 Meetings of the Board of Directors shall be convened quarterly and Directors~~and~~ ~~Supervisors~~shall be notified of the purpose of the meeting at least seven days in advance. A meeting may be convened at any time in case of urgent circumstances. The notice for a Board of Directors meeting may be made in writing, or by facsimile, email, or other methods.	Article 16-1 Meetings of the Board of Directors shall be convened quarterly and Directors shall be notified of the purpose of the meeting at least seven days in advance. A meeting may be convened at any time in case of urgent circumstances. The notice for a Board of Directors meeting may be made in writing, or by facsimile, email, or other methods.	Revised in accordance with establishment of the Audit Committee
Article 17 In the case that the number of vacancies on the Board of Directors reaches one-third of the total number of Directors,~~or that all~~ ~~Supervisors are discharged,~~then the Board of Directors shall convene, within 60 days, a special shareholders’ meeting to elect succeeding Directors or Supervisors to fill such vacancies; the term of office of the newly elected members shall be the same as remaining term of the predecessor.	Article 17 In the case that the number of vacancies on the Board of Directors reaches one-third of the total number of Directors, then the Board of Directors shall convene, within 60 days, a special shareholders’ meeting to elect succeeding Directors or Supervisors to fill such vacancies; the term of office of the newly elected members shall be the same as remainingterm of thepredecessor.	Revised in accordance with establishment of the Audit Committee
Article 18 In case election of the Board of Directors	Article 18 In case election of the Board of	Revised in accordance

-29-

Before Revision	After Revision	Explanation
cannot be completed before the expiration of the term of office, the term of office for the existing Directors~~and Supervisors~~ shall be extended until the new Directors ~~and Supervisors~~elect assume office.	Directors cannot be completed before the expiration of the term of office, the term of office for the existing Directors shall be extended until the new Directors elect assume office.	with establishment of the Audit Committee
Article 23 Supervisors of the Company shall exercise their right of supervision individually in accordance with applicable regulation. They may also attend the Board of Director meeting but are not eligible to vote.	Article 23 Deleted.	Revised in accordance with establishment of the Audit Committee
Article 23-1 Directors~~and Supervisors~~of the Company shall be entitled to remuneration for their duties regardless of profit or loss. The Board of Directors is authorized to determine the remuneration within the standards for maximum salaries established in the Company's Remuneration Policy based on the level of their participation in the Company's operations and the value of their contribution. The Board of Directors may pay transportation allowances to Directors ~~and Supervisors~~based on prevailing rates in the industry. Directors of the Company who work in the Company shall be entitled to monthly salaries in accordance with salary standards of regular managerial officers in addition to the Director~~or~~ ~~Supervisor c~~ompensation specified in Article 26 of these Articles of Incorporation.	Article 23-1 Directors of the Company shall be entitled to remuneration for their duties regardless of profit or loss. The Board of Directors is authorized to determine the remuneration within the standards for maximum salaries established in the Company's Remuneration Policy based on the level of their participation in the Company's operations and the value of their contribution. The Board of Directors may pay transportation allowances to Directors based on prevailing rates in the industry. Directors of the Company who work in the Company shall be entitled to monthly salaries in accordance with salary standards of regular managerial officers in addition to the Director compensation specified in Article 26 of these Articles of Incorporation.	Revised in accordance with establishment of the Audit Committee
Article 23-2 The Board of Directors is authorized to take out liability insurance for the Director~~s and Supervisors~~with respect to the liabilities resulting from exercising their duties during their term of office to reduce the risk of material damages to the Company and shareholders caused by illegal actions of its Directors~~or~~ ~~Supervisors.~~	Article 23-2 The Board of Directors is authorized to take out liability insurance for the Directors with respect to the liabilities resulting from exercising their duties during their term of office to reduce the risk of material damages to the Company and shareholders caused by illegal actions of its Directors.	Revised in accordance with establishment of the Audit Committee
Article 25 The Board of Directors of the Company shall prepare the following documents at the end of each fiscal year, to~~be presented~~ ~~to the Supervisors for audit and~~ ~~confirmation 30 days prior to the general~~ ~~shareholders' meeting, and submitted to~~	Article 25 The Board of Directors of the Company shall prepareand submitthe following documents at the end of each fiscal year to the general shareholders' meeting for adoption,in accordance with regulations:	Revised in accordance with establishment of the Audit Committee

-30-

Before Revision	After Revision	Explanation
the general shareholders' meeting for adoption: 1.Business report. 2.Financial statements. 3.Proposal Concerning Distribution of Earnings or Offset of Losses	1.Business report. 2.Financial statements. 3.Proposal Concerning Distribution of Earnings or Offset of Losses
Article 26 In the event the Company makes profits (i.e. profit before tax and before compensation distribution to the employees, Director~~s, and Supervisors)~~in any fiscal year, it shall set aside 1% to 30% of the profits as employee compensation and no higher than 5% of the profits as Directors~~and Supervisors~~ compensation. If there are cumulative losses, the Company shall reserve a sufficient amount to offset such losses. Employee and Directors~~and Supervisors~~ compensation shall be resolved by a majority vote at a Board of Director meeting attended by two thirds of the total number of Directors and shall be reported to the shareholders' meeting. The Board of Directors may resolve to distribute employee compensation in stocks or cash and the recipients may include employees of subsidiaries of the Company meeting certain requirements set by the Board of Directors.	Article 26 In the event the Company makes profits (i.e. profit before tax and before compensation distribution to the employeesandDirectors) in any fiscal year, it shall set aside 1% to 30% of the profits as employee compensation and no higher than 5% of the profits as Directors compensation. If there are cumulative losses, the Company shall reserve a sufficient amount to offset such losses. Employee and Directors compensation shall be resolved by a majority vote at a Board of Director meeting attended by two thirds of the total number of Directors and shall be reported to the shareholders' meeting. The Board of Directors may resolve to distribute employee compensation in stocks or cash and the recipients may include employees of subsidiaries of the Company meeting certain requirements set by the Board of Directors.	Revised in accordance with establishment of the Audit Committee
Article 26-1 The Company’s surplus earnings distribution or loss off-setting proposal may be proposed at the close of each half fiscal year. Where the Company has a profit at the end of each half fiscal year, the Company shall estimate and reserve the taxes to be paid, offset losses according to regulation, estimate and reserve employees and Directors’~~and Supervisors’~~compensation, and allocate 10% as legal reserve, unless accumulated legal reserve has reached the total paid-in capital. Then, set aside or reverse a special reserve in accordance with relevant regulations or as requested by the competent authorities. Omitted.	Article 26-1 The Company’s surplus earnings distribution or loss off-setting proposal may be proposed at the close of each half fiscal year. Where the Company has a profit at the end of each half fiscal year, the Company shall estimate and reserve the taxes to be paid, offset losses according to regulation, estimate and reserve employees and Directors’ compensation, and allocate 10% as legal reserve, unless accumulated legal reserve has reached the total paid-in capital. Then, set aside or reverse a special reserve in accordance with relevant regulations or as requested by the competent authorities. Omitted.	Revised in accordance with establishment of the Audit Committee

-31-

Before Revision		After Revision	Explanation
Article 29 Omitted The 37th amendment was made on June 12, 2018. The 38th amendment was made on June 12, 2019. The 39th amendment was made on August 25, 2021. These Articles of Incorporation shall be effective and implemented following approval from the shareholders' meeting.		Article 29 Omitted The 37th amendment was made on June 12, 2018. The 38th amendment was made on June 12, 2019. The 39th amendment was made on August 25, 2021. The 40th amendment was made on June 8, 2022. These Articles of Incorporation shall be effective and implemented following approval from the shareholders' meeting.	Addition of date of amendment.

-32-

Attachment VI

Largan Precision Co., Ltd. Comparison Table of Revisions to the "Procedures for the Acquisition or Disposal of Assets"


Article	Before Revision		After Revision			Explanation

	Article 6: Professional appraisers		Article 6: Professional appraisers			The Company
	and their officers, certified public		and their officers, certified			has amended
	accounts, attorneys, and securities		public accounts, attorneys, and			this Article in
	underwriters that provide the		securities underwriters that			accordance
	Company with appraisal reports,		provide the Company with			with the
	certified public accountant's		appraisal reports, certified			directive of
	opinions, attorney's opinions, or		public accountant's opinions,			Official Letter
	underwriter's opinions shall meet		attorney's opinions, or			No.
	the following requirements:		underwriter's opinions shall			11103804655
	(omitted)		meet the following			issued by the
	III. If the Company is required to		requirements:			Financial
	obtain appraisal reports from two or		(omitted)			Supervisory
	more professional appraisers, the		III. If the Company is required			Commission.
	different professional appraisers or		to obtain appraisal reports from
	appraisal officers may not be related		two or more professional
	parties or de facto related parties of		appraisers, the different
	each other. When issuing an		professional appraisers or
	appraisal report or opinion, the		appraisal officers may not be
	personnel referred to in the		related parties or de facto related
	preceding paragraph shall comply		parties of each other. When
	with the following:		issuing an appraisal report or
	(I) Prior to taking a case, they shall		opinion, the personnel referred
Article 6
	prudently assess their own		to in the preceding paragraph

	professional capabilities, practical		shall comply with		the industry
	experience, and independence.		codes of their respective trade
	(II) When	~~examining~~a case, they	associations of which they are
	shall appropriately plan and execute		members as well asthe
	adequate working procedures, in		following:
	order to produce a conclusion and		(I) Prior to taking a case, they
	use the conclusion as the basis for		shall prudently assess their own
	issuing the report or opinion. The		professional capabilities,
	related working procedures, data		practical experience, and
	collected, and conclusion shall be		independence.
	fully and accurately specified in the		(II) When	executinga case,
	case working papers.		they shall appropriately plan and
	(III) They shall undertake an		execute adequate working
	item-by-item evaluation of~~the~~		procedures, in order to produce a
	~~comprehensiveness, accuracy,~~and		conclusion and use the
	reasonableness of the sources of data		conclusion as the basis for
	used, the parameters, and the		issuing the report or opinion. The
	information, as the basis for issuance		related working procedures, data
	of the appraisal report or the		collected, and conclusion shall
	opinion.		be fully and accurately specified
	(IV) Theyshall issue a statement		in the case working papers.

-33-


Article	Before Revision					After Revision		Explanation

	attesting to the professional					(III) They shall undertake an
	competence and independence of the					item-by-item evaluation ofthe
	personnel who prepared the report or					appropriatenessand
	opinion, and that they have					reasonableness of the sources of
	evaluated and found that the					data used, the parameters, and
	information used is reasonable~~and~~					the information, as the basis for
	~~accurate~~, and that they have					issuance of the appraisal report
	complied with applicable laws and					or the opinion.
	regulations.					(IV) They shall issue a statement
						attesting to the professional
						competence and independence of
						the personnel who prepared the
						report or opinion, and that they
						have evaluated and found that
						the information used is
						appropriate andreasonable, and
						that they have complied with
						applicable laws and regulations.

Article 8	Article 8: Duties of the Board of					Article 8:Duties of the Board of		The Company
	Directors, Audit Committee,					Directors, Audit Committee,and		has established
	Independent Director~~s~~				~~, and~~	Independent Directors		the Audit
	~~Supervisors~~					I. With respect to any asset		Committee in
	I. With respect to any asset					acquisition or disposal that is		accordance
	acquisition or disposal that is subject					subject to the approval of the		with the
	to the approval of the Board of					Board of Directors in accordance		directive of
	Directors in accordance with the					with the Procedures or other		Official Letter
	Procedures or other laws or					laws or regulation, if any		No.
	regulation, if any Director expresses					Director expresses dissent and it		10703452331
	dissent and it is contained in the					is contained in the minutes or a		issued by the
	minutes or a written statement, the					written statement, the Company		Financial
	Company shall submit the Director's					shall submit the Director's		Supervisory
	dissenting opinion			~~to each~~		dissenting opinion	to the Audit	Commission.
	~~Supervisor.~~If there are any					Committee. If there are any		Therefore, in
	objections or reservations expressed					objections or reservations		accordance
	by an Independent Director, it shall					expressed by an Independent		with the
	be clearly recorded in the minutes of					Director, it shall be clearly		provisions of
	the board meeting.					recorded in the minutes of the		Articles 14-4
	II.	~~Where~~	~~Adit Citt h~~			board meeting.		and 14-5 of
			~~an u ommee as~~
	~~been established~~, any transactions					II. Any transactions involving		the Securities
	involving major assets or derivatives					major assets or derivatives shall		and Exchange
	shall be approved by over one-half					be approved by over one-half of		Act and the
	of all Audit Committee members					all Audit Committee members		current
	and submitted to the Board of					and submitted to the Board of		circumstances
	Directors for resolution. If the					Directors for resolution. If the		of the
	approval of at least one-half of all					approval of at least one-half of		Company, the
	members of the Audit Committee is					all members of the Audit		authority and
	not obtained, the Procedures may be					Committee is not obtained, the		responsibilitie
	implemented if approved by at least					Procedures may be implemented		s of the Audit
	two-thirds of all Directors,and the					if approved byat least		Committee are

-34-


Article	Before Revision	After Revision	Explanation

	resolution of the Audit Committee	two-thirds of all Directors, and	included.
	shall be recorded in the minutes of	the resolution of the Audit
	the Board of Directors meeting.	Committee shall be recorded in
		the minutes of the Board of
		Directors meeting.

Article 9 Subparagraph III	III. Where any one of the following circumstances applies with respect to the professional appraiser's appraisal results, unless all the appraisal results for the assets to be acquired are higher than the transaction amount, or all the appraisal results for the assets to be disposed of are lower than the transaction amount, a certified public accountant shall be engaged to perform the appraisal~~in~~ ~~accordance with the provisions of~~ ~~Sttt f Aditi Stdd N~~	III. Where any one of the	The Company
		following circumstances applies	has amended
		with respect to the professional	this Article in
		appraiser's appraisal results,	accordance
		unless all the appraisal results	with the
		for the assets to be acquired are	directive of
		higher than the transaction	Official Letter
		amount, or all the appraisal	No.
		results for the assets to be	11103804655
		disposed of are lower than the	issued by the
		transaction amount, a certified	Financial
		public accountant shall be	Supervisory
		engaged to perform the	Commission.
		appraisal and render a specific
	~~aemen o ung anars o.~~ ~~20 published by the ROC~~ ~~Accounting Research and~~ ~~Development Foundation (ARDF)~~ and render a specific opinion regarding the reason for the discrepancy and the appropriateness of the transaction price: (I) The discrepancy between the appraisal result and the transaction amount is 20% or more of the transaction amount. (II) The discrepancy between the appraisal results of two or more professional appraisers is 10% or more of the transaction amount.
		opinion regarding the reason for
		the discrepancy and the
		appropriateness of the
		transaction price:
		(I) The discrepancy between
		the appraisal result and the
		transaction amount is 20% or
		more of the transaction amount.
		(II) The discrepancy between
		the appraisal results of two or
		more professional appraisers is
		10% or more of the transaction
		amount.

Article 10:	Article 10: Appraisal of Securities Transactions Where the Company acquires or disposes of securities, it shall obtain the financial statements of the issuing company for the most recent period which shall be certified or reviewed by a certified public accountant (CPA) as reference for the appraisal of the transaction price. Where the transaction amount reaches 20% or more of paid-in capital or NT$300 million or more, the Company shall additionally engage a CPA prior to the date of occurrence of the event	Article 10: Appraisal of	The Company
		Securities Transactions Where	has amended
		the Company acquires or	the article in
		disposes of securities, it shall	accordance
		obtain the financial statements	with the
		of the issuing company for the	directive of
		most recent period which shall	Official Letter
		be certified or reviewed by a	No.
		certified public accountant	11103804655
		(CPA) as reference for the	issued by the
		appraisal of the transaction	Financial
		price. Where the transaction	Supervisory
		amount reaches 20% or more of	Commission.
		paid-in capital or NT$300
		million or more, the Company
		shall additionallyengage a CPA

-35-


Article		Before Revision	After Revision	Explanation

		to render an opinion on the reasonableness of the transaction price.~~Where the CPA requires the~~ ~~use of expert reports, it shall~~ ~~comply with the provisions of~~ ~~Statement of Auditing Standards~~ ~~No. 20 published by the ARDF.~~ This requirement does not apply, however, to securities with publicly quoted prices from an active market, or if it has been otherwise provided by the regulations of the FSC.	prior to the date of occurrence of
			the event to render an opinion
			on the reasonableness of the
			transaction price. This
			requirement does not apply,
			however, to securities with
			publicly quoted prices from an
			active market, or if it has been
			otherwise provided by the
			regulations of the FSC.

Article 14:	Article 14: Duties of the Board of Directors, Audit Committee, Independent Director~~s, and~~ ~~Supervisors~~ I. When the Company intends to acquire or dispose of real property or right-of-use assets thereof from or to a related party, or when it intends to acquire or dispose of assets other than real property or right-of-use assets thereof from or to a related party and the transaction amount reaches 20% or more of paid-in capital, 10% or more of the Company's total assets, or NT$300 million or more, except in trading of domestic government bonds or bonds under repurchase and resale agreements, or subscription or redemption of money market funds issued by domestic securities investment trust enterprises, the company may not proceed to enter		Article 14: Duties of the Board of Directors, Audit Committee, andIndependent Directors I.When the Company intends to acquire or dispose of real property or right-of-use assets thereof from or to a related party, or when it intends to acquire or dispose of assets other than real property or right-of-use assets thereof from or to a related party and the transaction amount reaches 20% or more of paid-in capital, 10% or more of the Company's total assets, or NT$300 million or more, except in trading of domestic government bonds or bonds under repurchase and resale agreements, or subscription or redemption of money market funds issued by domestic securities investment trust	1. The Company has established the Audit Committee in accordance with the directive of Official Letter No. 10703452331 issued by the Financial Supervisory Commission. Therefore, in accordance with the provisions of Articles 14-4 and 14-5 of the Securities and Exchange

-36-


Article	Before Revision	After Revision	Explanation

	into a transaction contract or make a payment until the following matters have been approved~~by the board of~~ ~~directors and recognized by the~~ ~~supervisors~~: (omitted) I. The calculation of the transaction amounts referred to in the preceding subsection shall be made in accordance with Article 28, Subsection 2 herein, and "within the preceding year" as used herein refers to the year preceding the date of occurrence of the current transaction. Items that have been approved~~by the Board of Directors~~ ~~and recognized by the Supervisors~~ need not be counted toward the transaction amount. ~~III.~~ With respect to the types of transactions listed below conducted between the Company and subsidiaries or between its subsidiaries in which the Company directly or indirectly holds 100% of the issued shares or authorized capital, the Company's Board of Directors may, pursuant to Article 12, delegate individuals to decide such matters when the transaction amount is under NT$300 million and have the decisions subsequently submitted to and ratified by the next Board of Directors meeting: (I) Acquisition or disposal of equipment or right-of-use assets thereof held for business use. (II)Acquisition or disposal of real property right-of-use assets held for business use. ~~IV.~~ When proposed for discussion by the Board of Directors, any objections or reservations expressed by Independent Directors shall be detailed in the meeting minutes of the Board of Directors.~~V. Where the~~ ~~Company has established an Audit~~ ~~Citt i d ith l~~	enterprises, the company may not proceed to enter into a transaction contract or make a payment until the following matters have been approvedby at least one-half of all members of the Audit Committee and then	Act and the current circumstance s of the Company, the former Subsections 2 and 5 have been revised and transferred to Subsections 3 and 4, respectively, in conjunction with the revision of the authority and responsibiliti es of the Audit Committee. 2. The Company has added Subsection 2 in accordance with the directive of Official Letter No. 11103804655 issued by the Financial Supervisory Commission. 3. 3. The former Subsections 3 and 4 has been transferred to Subsections 5 and 6, respectively.
		submitted to the Board of Directors for resolutions: (omitted) II. If the Company or a subsidiary which is not a domestic public company has made a transaction stipulated in Subsection 1, and the transaction
		amount is more than 10 percent of the Company's total assets, the
		Company shall submit the materials listed in the Subsection
		1 to the shareholders'meeting for
		approval before signing a transaction contract and making payments. However, the regulation does not apply in the transactions between the Company and its subsidiaries, or
		the transactions among its subsidiaries. III.The calculation of the transaction amounts referred to in theSubsections 1 and 2shall be made in accordance with Article 28, Subsection 2 herein, and "within the preceding year" as used herein refers to the year preceding the date of occurrence of the current transaction. Items that have beenresolved by the Board of Directors and approved
		by the shareholders'meeting need not be counted toward the transaction amount. IV.If the approval of at least one-half of all members of the Audit Committee is not obtained
		for Subsections 1 and 3, the Procedures may be implemented
		if approved by at least two-thirds
	~~ommee n accorance w aws,~~ ~~items subject to approval by the~~ ~~Supervisors in Subsection 1 of this~~
		of all Directors, and the resolution of the Audit

-37-


Article	Before Revision			After Revision	Explanation

	~~Article shall require the approval of~~ ~~a majority of one-half of the Audit~~ ~~Committee first and they shall be~~ ~~submitted to the Board of Directors~~ ~~for resolution. If the approval of at~~ ~~least one-half of all members of the~~ ~~Adit Citt i t btid th~~			Committee shall be recorded in the minutes of the Board of Directors meeting. V.With respect to the types of transactions listed below conducted between the Company and subsidiaries or between its subsidiaries in which the Company directly or indirectly holds 100% of the issued shares or authorized capital, the Company's Board of Directors may, pursuant to Article 12, delegate individuals to decide such matters when the transaction amount is under NT$300 million and have the decisions subsequently submitted to and ratified by the next Board of Directors meeting: (I) Acquisition or disposal of equipment or right-of-use assets thereof held for business use. (II) Acquisition or disposal of real property right-of-use assets held for business use. VI.When proposed for discussion by the Board of Directors, any objections or reservations expressed by Independent Directors shall be detailed in the meeting minutes of the Board of Directors.
	~~u ommee s no oane, e~~ ~~Procedures may be implemented if~~ ~~d b t lt tthid f ll~~
	~~approve y a eas wo-rs o a~~ ~~Directors, and the resolution of the~~ ~~Audit Committee shall be recorded~~ ~~in the minutes of the Board of~~ ~~Directors meeting.~~
	~~re~~
	(II)	~~The Supervisors~~shall comply		(II) Paragraphs 1 and 2 of Article 218 of the Company Act shall apply mutatis mutandis with regard to Independent Directors who are members of the Audit Committee pursuant to	Amended
	with	Article 218 of the Company Act			based on the
	and supervise the Company's				current
	execution of the actions specified in				circumstances
	the preceding item of this				of the
	subsection.		~~Where an Audit~~		Company.
Article 18
	~~Ci~~		~~has been established in~~	the provisions of Paragraph 4 of
Subparagraph	~~ommttee~~
	~~d~~		~~with the provisions of~~	Article 14-4 of the Securities and Exchange Act, and the Independent Directors shall supervise the Company's execution of the actions specified in the preceding item of this subsection.
Item 2	~~accorance~~
	~~the Act, the preceding part of this~~

	~~it hll l tti tdi t~~
	~~em sa appy muas muans o~~
	~~the Independent Director~~

Article 28:	(VI)Where an asset transaction other			(VI)Where an asset transaction	The Company
Subparagraph	than anyof those referred to in this			other than anyof those referred	has amended

-38-


Article	Before Revision			After Revision			Explanation

Item 6	subsection, a disposal of receivables			to in this subsection, a disposal			this Article in
	by a financial institution, or an			of receivables by a financial			accordance
	investment in the mainland China			institution, or an investment in			with the
	area reaches 20% or more of paid-in			the mainland China area reaches			directive of
	capital or NT$300 million; provided,			20% or more of paid-in capital			Official Letter
	this shall not apply to the following			or NT$300 million; provided,			No.
	circumstances:			this shall not apply to the			11103804655
	a.Trading of domestic government			following circumstances:			issued by the
	bonds.			a.Trading of domestic			Financial
	b.Trading of bonds under repurchase			government bonds		or foreign	Supervisory
	and resale agreements, or			government bonds		with the	Commission.
	subscription or redemption of money			credit rating not lower than the
	market funds issued by domestic			sovereign credit rating of
	securities investment trust			Taiwan.
	enterprises.			b.Trading of bonds under
				repurchase and resale
				agreements, or subscription or
				redemption of money market
				funds issued by domestic
				securities investment trust
				enterprises.
	Article 37: Implementation and			Article 37: Implementation			Amended
	revision				and revision		based on the
	I. The Procedures shall first be			I.	The Procedures shall first		current
	~~d b th Bd f Dit d~~			be	approved by at least one-half		circumstances
	~~passe y e oar o recors an~~
	~~delivered to all Supervisors~~before it			of	all members of the Audit		of the
	is submitted to the shareholders'			Committee and resolved by the			Company.
	meeting for approval and			Board of Directorsbefore it is
	implementation. The same shall			submitted to the shareholders'
	apply to any amendment. If a			meeting for approval and
	Director expresses objection and			implementation. The same shall
	records or written statements are			apply to any amendment. If a
	available, the information regarding			Director expresses objection and
	the Director's objection shall be			records or written statements are
	submitted		~~to the Supervisors.~~If there	available, the information
Article 37:	are any objections or reservations			regarding the Director's
	expressed by an Independent			objection shall be submittedto
	Director, it shall be clearly recorded			the Audit Committee. If there
	in the minutes of the board meeting.			are any objections or
	II	.~~Where an Audit Committee has~~		reservations expressed by an
	~~been established, the establishment~~			Independent Director, it shall be
	~~or revision of the Procedures shall~~			clearly recorded in the minutes
	~~first be approved by one-half of all~~			of the board meeting.
	~~Audit Committee members and it~~			II. If the approval of at least
	~~shall be submitted to the Board of~~			one-half of all members of the
	~~Directors for resolution. I~~f the			Audit Committee is not obtained
	approval of at least one-half of all			for the preceding subsection,the
	members of the Audit Committee is			Procedures may be implemented
	not obtained, the Procedures may be			if approved by at least
	implemented if approved byat least			two-thirds of all Directors,and

-39-


Article	Before Revision	After Revision	Explanation

	two-thirds of all Directors, and the	the resolution of the Audit
	resolution of the Audit Committee	Committee shall be recorded in
	shall be recorded in the minutes of	the minutes of the Board of
	the Board of Directors meeting.	Directors meeting.

-40-

Attachment VII

Largan Precision Co., Ltd. Comparison Table of Revisions to the "Procedures for Engaging in Derivatives Trading"

Article	Before Revision	After Revision	After Revision	After Revision	Explanation
	(None)	Article 9-1:	Major Derivatives		The Company
		Tradings			has established
		Major derivatives tradings shall be			the Audit
		approved by over one-half of all			Committee in
		Audit Committee members and			accordance with
		submitted to the Board of Directors			the directive of
		for resolution. If the approval of at			Official Letter
		least one-half of all members of the			No.
		Audit Committee is not obtained,			10703452331
		the Procedures may be implemented			issued by the
		if approved by at least two-thirds of			Financial
		all Directors, and the resolution of			Supervisory
		the Audit Committee shall be			Commission.
		recorded in the minutes of the Board			Therefore, in
Article 9-1		of Directors meeting.			accordance with
					the provisions
					of Articles 14-4
					and 14-5 of the
					Securities and
					Exchange Act
					and the current
					circumstances
					of the Company,
					the authority
					and
					responsibilities
					of the Audit
					Committee are
					added.
Article 14	Article 15: Internal audit	Article 14: Internal audit			The Company
	Internal audit personnel shall	Internal audit personnel shall			has established
	periodically make a	periodically make a determination			the Audit
	determination of the suitability	of the suitability of internal controls			Committee in
	of internal controls on	on derivatives and conduct a			accordance with
	derivatives and conduct a	monthly inspection of how faithfully			the directive of
	monthly inspection of how	derivatives trading by the trading			Official Letter
	faithfully derivatives trading by	department adheres to the			No.
	the trading department adheres	procedures for engaging in			10703452331
	to the procedures for engaging in	derivatives trading, and prepare an			issued by the
	derivatives trading, and prepare	audit report. If any material			Financial
	an audit report. If any material	violation is discovered,		the Audit	Supervisory
	violation is discovered,~~all~~	Committeeshall be notified in			Commission.

-41-

Article	Before Revision	Before Revision	Before Revision	After Revision	After Revision	After Revision	Explanation
	~~Supervisors and Independent~~			writing, and related personnel shall			Therefore, in
	~~Directors~~shall be notified in			be penalized commensurate with the			accordance with
	writing, and related personnel			violation.			the provisions
	shall be penalized commensurate						of Articles 14-4
	with the violation.						and 14-5 of the
							Securities and
							Exchange Act
							and the current
							circumstances
							of the Company,
							the authority
							and
							responsibilities
							of the Audit
							Committee are
							included.
Article 15	Article 16: Enforcement and			Article 15: Enforcement and			The Company
	amendment			amendment			has established
	The Procedures shall first be			The Procedures shall first be			the Audit
	passed	~~b th Bd f Dit~~		approved by at least one-half of all			Committee in
		~~y e oar o recors~~
	~~and delivered to all Supervisors~~			members of the Audit Committee			accordance with
	~~before it is submitted to the~~			and resolved by the Board of			the directive of
	~~shareholders' meeting for~~			Directorsbefore it is submitted to			Official Letter
	~~approval.~~The same shall apply			the shareholders' meeting for			No.
	to any amendment. If a Director			approval and implementation. The			10703452331
	expresses objection and records			same shall apply to any			issued by the
	or written statements are			amendment. If a Director expresses			Financial
	available, the Company shall			objection and records or written			Supervisory
	submit information regarding			statements are available, the			Commission.
	the Director's objectio~~n to~~			information regarding the Director's			Therefore, in
	~~Supervisors.~~			objection shall be submitted		to the	accordance with
	In addition, the opinions of			Audit Committee.			the provisions
	Independent Directors shall be			If the approval of at least one-half			of Articles 14-4
	taken into full consideration in			of all members of the Audit			and 14-5 of the
	discussions in the Board of			Committee is not obtained, the			Securities and
	Directors meeting on these			Procedures may be implemented if			Exchange Act
	Procedures		~~in accordance with~~	approved by at least two-thirds of			and the current
	~~the preceding paragraph.~~			all Directors, and the resolution of			circumstances
	Independent Directors’			the Audit Committee shall be			of the Company,
	assenting or dissenting opinions			recorded in the minutes of the			the authority
	and reasons of dissent shall be			Board of Directors meeting.			and
	included in the meeting minutes.			In addition, the opinions of			responsibilities
				Independent Directors shall be			of the Audit
				taken into full consideration in			Committee are
				discussions in the Board of			included.
				Directors meeting on these
				Proceduresin accordance with
				Paragraph	1. Independent Directors’
				assenting or dissenting opinions and
				reasons of dissent shall be included
				in the meetingminutes.

-42-

Attachment VIII

Largan Precision Co., Ltd. Comparison Table of Revisions to the "Rules for Loaning of Funds"

Article	Before Revision		After Revision	After Revision	Explanation
	(None)	IV.	Any major loaning of funds by		The Company
		the Company shall be approved by			has established
		over one-half of all Audit			the Audit
		Committee members and submitted			Committee in
		to the Board of Directors for			accordance with
		resolution. If the approval of at least			the directive of
		one-half of all members of the			Official Letter
		Audit Committee is not obtained,			No.
		the Procedures may be implemented			10703452331
		if approved by at least two-thirds of			issued by the
		all Directors, and the resolution of			Financial
		the Audit Committee shall be			Supervisory
		recorded in the minutes of the			Commission.
		Board of Directors meeting.			Therefore, in
Article 7					accordance with
Subparagraph					the provisions of
4					Articles 14-4
					and 14-5 of the
					Securities and
					Exchange Act
					and the current
					circumstances of
					the Company,
					the new
					Subsection 4,
					concerning the
					authority and
					responsibilities
					of the Audit
					Committee, is
					added.
	II. Where a change in the	II. Where a change in the			The Company
	Company causes the amount	Company causes the amount to			has established
	to exceed the limit, a	exceed the limit, a rectification plan			the Audit
	rectification plan shall be	shall be formulated and delivered to			Committee in
	formulated and delivered~~to~~	the Audit Committeeto enhance			accordance with
	~~the Supervisors and~~	internal control and management of			the directive of
Article 10:
	~~Independent Directors~~to	the Company.			Official Letter
Item 2 and 4
	enhance internal control and	IV. Where a change in the			No.

	management of the Company.	Company causes the borrower to be			10703452331
	IV. Where a change in the	incompatible with this Rules or			issued by the
	Company causes the	causes the amount to exceed the			Financial
	borrower to be incompatible	limit, a rectification plan shall be			Supervisory
	with this Rules or causes the	formulated,delivered		to the Audit	Commission.

-43-

Article	Before Revision	Before Revision	After Revision	Explanation
	amount to exceed the limit, a		Committee,reported to the Board of	Therefore, in
	rectification plan shall be		Directors, and implemented to	accordance with
	formulated, delivered	~~to the~~	complete rectification based on the	the provisions of
	~~Supervisors and Independent~~		timeframe set out in the plan.	Articles 14-4
	~~Directors,~~reported to the			and 14-5 of the
	Board of Directors, and			Securities and
	implemented to complete			Exchange Act
	rectification based on the			and the current
	timeframe set out in the plan.			circumstances of
				the Company,
				the authority
				and
				responsibilities
				of the Audit
				Committee are
				included.
	Article 11: Internal audit		Article 11: Internal audit	The Company
	The Company's internal		The Company's internal auditors	has established
	auditors shall audit the		shall audit the operation procedures	the Audit
	operation procedures of		of loaning funds to others and the	Committee in
	loaning funds to others and		implementation thereof no less	accordance with
	the implementation thereof		frequently than quarterly and	the directive of
	no less frequently than		prepare written records accordingly.	Official Letter
	quarterly and prepare written		They shall promptly notifythe	No.
	records accordingly. They		Audit Committeein writing of any	10703452331
	shall promptly notify~~the~~		material violation found, if any.	issued by the
	~~Supervisors and Independent~~			Financial
	~~Directors~~in writing of any			Supervisory
	material violation found, if			Commission.
	any.			Therefore, in
Article 11				accordance with
				the provisions of
				Articles 14-4
				and 14-5 of the
				Securities and
				Exchange Act
				and the current
				circumstances of
				the Company,
				the authority
				and
				responsibilities
				of the Audit
				Committee are
				included.

-44-

Article	Before Revision	Before Revision	After Revision	After Revision	After Revision	Explanation
Article 14	Article 14: Enforcement		Article 14: Enforcement and			The Company
	and amendment		amendment			has established
	Once this Rules are passed~~by~~		Once this Rules are	approved by at		the Audit
	~~the Board of Directors, they~~		least one-half of all	members of the		Committee in
	~~shall be submitted to the~~		Audit Committee and resolved by			accordance with
	~~Supervisors and reported to~~		the Board of Directors, they shall be			the directive of
	~~the shareholders' meeting for~~		reported to the shareholders'			Official Letter
	~~consent.~~If a Director		meeting for consent and then			No.
	expresses objection and		implemented.If a Director			10703452331
	records or written statements		expresses objection and records or			issued by the
	are available, information		written statements are available,			Financial
	regarding the Director's		information regarding the Director's			Supervisory
	objection shall be submitted		objection shall be submitted		to the	Commission.
	~~to Supervisors~~and to the		Audit Committeeand to the			Therefore, in
	shareholders' meeting for		shareholders' meeting for			accordance with
	discussion. The same shall		discussion. The same shall apply to			the provisions of
	apply to any revision.		any revision.			Articles 14-4
	When the Rules for Loaning		If the approval of at least one-half			and 14-5 of the
	of Funds is submitted to the		of all members of the Audit			Securities and
	Board of Directors for		Committee is not obtained, the			Exchange Act
	discussions	~~in accordance~~	Procedures may be implemented if			and the current
	~~with the preceding paragraph~~,		approved by at least two-thirds of			circumstances of
	the opinions of Independent		all Directors, and the resolution of			the Company,
	Directors shall be taken into		the Audit Committee shall be			the authority
	full consideration. If any		recorded in the minutes of the			and
	Independent Director has any		Board of Directors meeting.			responsibilities
	dissenting opinion or		When the Rules for Loaning of			of the Audit
	qualified opinion, it shall be		Funds is submitted to the Board of			Committee are
	noted in the minutes of the		Directors for discussionsin			included.
	Board of Directors meeting.		accordance with Paragraph 1, the
			opinions of Independent Directors
			shall be taken into full
			consideration. If any Independent
			Director has any dissenting opinion
			or qualified opinion, it shall be
			noted in the minutes of the Board of
			Directors meeting.

-45-

Attachment IX

Largan Precision Co., Ltd. Comparison Table of Revisions to the "Rules for Endorsements/Guarantees"

Article	Before Revision	After Revision	Explanation
	~~III.~~ Where a company in which the	III. Any major	1.The
	Company holds, directly or	endorsements/guarantees	Company has
	indirectly, more than 90% of the	involving the Company shall be	established the
	voting shares provides	approved by over one-half of all	Audit
	endorsements/guarantees in	Audit Committee members and	Committee in
	accordance with Article 3,	submitted to the Board of	accordance
	Subparagraph 2, it shall submit the	Directors for resolution. If the	with the
	proposal to the Board of Directors	approval of at least one-half of	directive of
	for approval before	all members of the Audit	Official Letter
	implementation, provided that this	Committee is not obtained, the	No.
	restriction shall not apply to	Procedures may be implemented	10703452331
	endorsements/guarantees made	if approved by at least two-thirds	issued by the
	between companies in which the	of all Directors, and the	Financial
	Company holds, directly or	resolution of the Audit	Supervisory
	indirectly, 100% of the voting	Committee shall be recorded in	Commission.
	shares.	the minutes of the Board of	Therefore, in
	~~IV.~~ Where the Company needs to	Directors meeting.	accordance
	exceed the limits set out in this	IV. Where a company in which	with the
	Rules to satisfy its business	the Company holds, directly or	provisions of
	requirements, and where the	indirectly, more than 90% of the	Articles 14-4
	conditions set out in this Rules are	voting shares provides	and 14-5 of the
Article 5:	complied with, it shall obtain	endorsements/guarantees in	Securities and
	approval from the Board of	accordance with Article 3,	Exchange Act
Item 3 to 4
	Directors and half or more of the	Subparagraph 2, it shall submit	and the current
	Directors shall act as joint	the proposal to the Board of	circumstances
	guarantors for any loss that may be	Directors for approval before	of the
	caused to the company by the	implementation, provided that	Company, the
	excess endorsement/guarantee. It	this restriction shall not apply to	new
	shall also amend the Rules for	endorsements/guarantees made	Subsection 3,
	Endorsements/Guarantees	between companies in which the	concerning the
	accordingly and submit the same to	Company holds, directly or	authority and
	the shareholders' meeting for	indirectly, 100% of the voting	responsibilities
	ratification after the fact. If the	shares.	of the Audit
	shareholders' meeting does not give	V.Where the Company needs to	Committee, is
	consent, the company shall adopt a	exceed the limits set out in this	added.
	plan to discharge the amount in	Rules to satisfy its business	2.The number
	excess within a given time limit.	requirements, and where the	of Subsections
	Where the Company has	conditions set out in this Rules	3 and 4 has
	established the position of	are complied with, it shall obtain	been altered.
	independent director, when it	approval from the Board of
	makes endorsements/guarantees for	Directors and half or more of the
	others, it shall take into full	Directors shall act as joint
	consideration the opinions of each	guarantors for any loss that may
	independent director; independent	be caused to the company by the
	directors' opinions specifically	excess endorsement/guarantee. It

-46-

Article	Before Revision	Before Revision	After Revision	After Revision	Explanation
	expressing assent or dissent and the		shall also amend the Rules for
	reasons for dissent shall be		Endorsements/Guarantees
	included in the minutes of the		accordingly and submit the same
	board of directors' meeting.		to the shareholders' meeting for
			ratification after the fact. If the
			shareholders' meeting does not
			give consent, the company shall
			adopt a plan to discharge the
			amount in excess within a given
			time limit. Where the Company
			has established the position of
			independent director, when it
			makes endorsements/guarantees
			for others, it shall take into full
			consideration the opinions of
			each independent director;
			independent directors' opinions
			specifically expressing assent or
			dissent and the reasons for
			dissent shall be included in the
			minutes of the board of directors'
			meeting.
	V. If, as a result of a change in		V. If, as a result of a change in		The Company
	circumstances, an entity for which		circumstances, an entity for		has established
	an endorsement/guarantee is made		which an		the Audit
	does not meet the requirements of		endorsement/guarantee is made		Committee in
	these Rules endorsement/guarantee		does not meet the requirements		accordance
	amount exceeds the limit, the		of these Rules		with the
	endorsement/guarantee amount or		endorsement/guarantee amount		directive of
	the portion that exceeds the limit		exceeds the limit, the		Official Letter
	for such entity shall be completely		endorsement/guarantee amount		No.
	terminated upon the expiry of the		or the portion that exceeds the		10703452331
	contract or within a specific		limit for such entity shall be		issued by the
	deadline based on the rectification		completely terminated upon the		Financial
	plan formulated by the Company.		expiry of the contract or within		Supervisory
Article 6	The related rectification plans shall		a specific deadline based on the		Commission.
	be delivered	~~to all Supervisors and~~	rectification plan formulated by		Therefore, in
Item 5
	~~Iddt~~	~~Directors a~~nd reported	the Company. The related		accordance
	~~nepenen~~
	to the Board	of Directors. The	rectification plans shall be		with the
	Company shall complete the		delivered	to the Audit	provisions of
	rectification according to the		Committee and reported to the		Articles 14-4
	timeframe set out in the plan.		Board of Directors. The		and 14-5 of the
			Company shall complete the		Securities and
			rectification according to the		Exchange Act
			timeframe set out in the plan.		and the current
					circumstances
					of the
					Company, the
					authority and
					responsibilities
					of the Audit

-47-

Article	Before Revision	Before Revision	After Revision	After Revision	After Revision	Explanation
						Committee are
						included.
Article 9	Article 9: Internal audit		Article 9: Internal audit			The Company
						has established
	The Company's internal auditors		The Company's internal auditors			the Audit
	shall audit the procedures for		shall audit the procedures for			Committee in
	making of endorsements/guarantees		making of			accordance
	and the implementation at least		endorsements/guarantees and the			with the
	once every quarter and prepare		implementation at least once			directive of
	written records accordingly. They		every quarter and prepare written			Official Letter
	shall promptly notify~~the~~		records accordingly. They shall			No.
	~~Supervisors and Independent~~		promptly notify	the Audit		10703452331
	~~Directors~~in writing of any material		Committeein writing of any			issued by the
	violation found.		material violation found.			Financial
						Supervisory
						Commission.
						Therefore, in
						accordance
						with the
						provisions of
						Articles 14-4
						and 14-5 of the
						Securities and
						Exchange Act
						and the current
						circumstances
						of the
						Company, the
						authority and
						responsibilities
						of the Audit
						Committee are
						included.
Article 13	Article 13: Enforcement and		Article 13: Enforcement and			The Company
	amendment		amendment			has established
	The Regulations shall first be		The Rules shall first be			the Audit
	~~passed by the Board of Directors~~		approved by at least one-half of			Committee in
	~~and delivered to all Supervisors~~		all members of the Audit			accordance
	~~before it is submitted to the~~		Committee and resolved by the			with the
	~~shareholders' meeting for consent.~~		Board of Directors before it is			directive of
	If a Director expresses an objection		submitted to the shareholders'			Official Letter
	and records or written statements		meeting for approval and			No.
	are available, the Company shall		implementation.If a Director			10703452331
	submit information	regarding the	expresses an objection and			issued by the
	Director's objection	~~to Supervisors~~	records or written statements are			Financial
	and to the shareholders' meeting for		available, the Company shall			Supervisory
	discussion. The same shall apply to		submit information regarding			Commission.
	any revision.		the Director's objection		to the	Therefore, in
	The opinions of Independent		Audit Committeeand to the			accordance
	Directors shall be taken into full		shareholders' meetingfor			with the

-48-

Before Revision	Before Revision	After Revision	After Revision	Explanation
consideration in discussions in the		discussion. The same shall apply		provisions of
Board of Directors meeting on the		to any revision.		Articles 14-4
Rules	~~in accordance with the~~	If the approval of at least		and 14-5 of the
~~preceding paragraph~~. If any		one-half of all members of the		Securities and
Independent Director expresses		Audit Committee is not		Exchange Act
dissenting opinions or qualified		obtained, the Procedures may be		and the current
opinions, they shall be noted in the		implemented if approved by at		circumstances
minutes of the Board of Directors		least two-thirds of all Directors,		of the
meeting.		and the resolution of the Audit		Company, the
		Committee shall be recorded in		authority and
		the minutes of the Board of		responsibilities
		Directors meeting.		of the Audit
		The opinions of Independent		Committee are
		Directors shall be taken into full		included.
		consideration in discussions in
		the Board of	Directors meeting
		on the Rules	in accordance with
		Paragraph 1.	If any Independent
		Director expresses dissenting
		opinions or qualified opinions,
		they shall be noted in the
		minutes of the Board of
		Directors meeting.

-49-

Appendix

Appendix I(Before Revision)

Largan Precision Co., Ltd. Articles of Incorporation

Chapter 1 General Provisions

Article 1: The Company is incorporated as a company limited by shares under the Company Act of the Republic of China, and its name is 大立光電股份有限公司. The Company's name in English is Largan Precision Co., Ltd.
Article 2: The Company engages in the following businesses:
CE01030 Photographic and optical equipment manufacturing.
CQ01010 Die manufacturing.
F601010 Intellectual property
F113030 Wholesale of precision instruments
F401010 International trade.
I501010 Product designing
CF01011 Medical materials and equipment manufacturing.
ZZ99999 All business items that are not prohibited or restricted by law, except those that are subject to special approval.
Article 2-1: The total amount of the Company's investments in other entities may exceed 40% of its paid-in capital, and is not subject to the restriction of total investment amount stipulated in Article 13 of the Company Act.
Article 2-2: The Company may provide guarantees for companies in the same industry specified above, and provide endorsement and guarantee for loans funded from government authorities and financial institutions when necessary for its operations.
Article 3: The Company's head office is established in Taichung City. When necessary, the Company may establish branch offices domestically or overseas, subject to resolution by its Board of Directors.
Article 4: The Company's public announcements shall be made pursuant to Article 28 of the Company Act.

Chapter 2 Shares

Article 5: The total capital stock of the Company is in the amount of two billion New Taiwan Dollars (NT$2,000,000,000) divided into 200 million (200,000,000) common shares, at a par value of Ten New Taiwan Dollars (NT$10) each. The Board of Directors is authorized to issue the shares in multiple installments.
A total of NT$100,000,000 totaling 10 million (10,000,000) shares of the aforementioned capital shall be reserved for the issuance of employee stock options at NT$10 per share, and may be issued in installments upon resolution by the Board of Directors.
Article 6: The Company's share certificates shall be name bearing, and registered, signed or

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sealed by the Chairman of the Board and at least two Directors. The share certificates shall be affixed with the Company's logo, numbered, and issued after certification by the competent authority.

The Company may be exempted from printing share certificates for the shares issued. The Company not printing its share certificate shall register the issued stock with the securities depository and custodian institution. Requirements in the two preceding paragraphs shall not apply.
Article 7: The Company shall administer all shareholder services in accordance with the "Regulations Governing the Administration of Shareholder Services of Public Companies" and related regulations.
Article 8: In the event of reissue of share certificates due to loss or damage, the Company may charge a fee to cover the cost and the applicable stamp duty.
Article 9: Share transfer registration shall be suspended 60 days prior to the convening date of a regular shareholders' meeting, or 30 days prior to the convening date of a special shareholders' meeting, or 5 days prior to the record date on which dividends, bonuses or other benefits are scheduled for distribution by the Company.
Article 9-1: Transfer of shares to employees at prices below the Company's actual average repurchase price or issue of employee stock options below the market price (net worth per share) are subject to a shareholders' meeting resolution and must be resolved with the presence of shareholders representing more than one- half of the total number of outstanding shares, and voted in favor by more than two-thirds of votes present.

Chapter 3 Shareholders’ Meeting

Article 10: Shareholders’ meeting shall be of two types: general meetings and special meetings. General shareholders’ meetings are convened annually within six months after the end of each fiscal year. Special meetings shall be convened according to the law when necessary. The notice for convening a shareholders' meeting shall be given to each shareholders 30 days before a general meeting and 15 days before a special meeting. The date, location, and purpose of the meeting shall be notified to all shareholders. The notices for the shareholders' meeting prescribed in the preceding paragraph may be distributed in electronic form, subject to agreement by the recipient thereof.
Article 11: A shareholder who cannot attend a shareholders' meeting may appoint a proxy to attend on his/her behalf by executing a power of attorney in accordance with Article 177 of the Company Act.
Article 12: Where a shareholders' meeting is convened by the Board of Directors, the meeting shall be presided over by the Chairman of the Board. In case of his absence, the Chairman shall designate a Director to act on his behalf. In the absence of such designation, the Directors shall elect one person from among themselves to serve as chairman of the meeting.
For shareholders' meetings convened by any other person having the convening right

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other than the Board of Directors, he/she will act as the chairman of that meeting, however, if there are two or more persons having the convening right, the chairman of the meeting shall by elected from among themselves.

Article 13: All shareholders are entitled to one vote for each share held, except for shares that have no voting power under the circumstances stipulated in Article 179 of the Company Act.
Article 14: Unless otherwise provided for in the Company Act, a resolution shall be adopted if voted in favor by a majority of votes by attending shareholders representing more than one-half of the total number of voting shares.
Article 15: Resolutions made during the shareholders' meeting shall be recorded in the minutes in accordance with Article 183 of the Company Act.

Chapter 4 Directors and Supervisors

Article 16: The Company shall have seven to nine Directors and two to three Supervisors elected at the shareholders' meeting from any individual with legal capacity. The term of office for Directors and Supervisors shall be three years and all shall be eligible for re-election. The total proportion of shares held by all Directors and Supervisors of the Company shall be subject to regulations prescribed by the securities authority.
The Company shall have, among the aforementioned Directors, at least two independent Directors, and the number of Independent Directors shall not be less than one-fifth of the total number of Directors. The Company's Directors and Supervisors shall be elected by the shareholders from among the nominees listed in the roster of candidates based on a candidate nomination system.
The "Directors" referred to in these Articles of Incorporation include Independent Directors.

The candidate nomination system shall be implemented in accordance with Article 192-1 and Article 216-1 of the Company Act.

Article 16-1: Meetings of the Board of Directors shall be convened quarterly and Directors and Supervisors shall be notified of the purpose of the meeting at least seven days in advance. A meeting may be convened at any time in case of urgent circumstances. The notice for a Board of Directors meeting may be made in writing, or by facsimile, email, or other methods.
Article 17: In the case that the number of vacancies on the Board of Directors reaches one-third of the total number of Directors, or that all Supervisors are discharged, then the Board of Directors shall convene, within 60 days, a special shareholders’ meeting to elect succeeding Directors or Supervisors to fill such vacancies; the term of office of the newly elected members shall be the same as remaining term of the predecessor.
Article 18: In case election of the Board of Directors cannot be completed before the expiration of the term of office, the term of office for the existing Directors and Supervisors shall

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be extended until the new Directors and Supervisors elect assume office. Article 19: The Board of Directors shall be formed by the Directors. The Chairman and Vice Chairman shall be elected by a majority of votes in a meeting attended by over two-thirds of the Directors. The Board of Directors shall execute all matters of the Company in accordance with applicable laws, regulations, these Articles of Incorporation, and resolutions adopted at shareholders' meeting and by the Board of Directors. Article 20: The Company's business strategies and other important matters shall be decided by resolutions adopted by the Board of Directors. The first meeting of the Board of Directors for each new term shall be convened in accordance with Article 203 of the Company Act. Other meetings shall be convened and presided over by the Chairman. If the Chairman is unable to perform his/her duties, the Vice Chairman shall act on the Chairman's behalf. If the Vice Chairman is also unavailable or unable to perform his/her duties, the Chairman shall designate one of the Directors to act on his/her behalf. In the absence of such a designation, the Directors shall elect from among themselves an acting Chairman of the Board of Directors. Article 21: Unless otherwise provided for in the Company Act, the adoption of a resolution at a Board of Directors meeting shall require a majority vote in favor of the resolution by more than one-half of the Directors in attendance of the meeting. If a Director is unable to attend a meeting, he/she may appoint another Director to attend the meeting on his/her behalf by completing the Company's proxy form, specifying the scope of authority with respect to the subjects to be discussed at the meeting. Each Director may act as a proxy for one other Director only. Article 22: Resolutions adopted at the meeting of the Board of Directors shall be recorded in the minutes and signed or sealed by the Chairman. The minutes shall be distributed to each Director within 20 days after the meeting. The minutes shall include a summary of the essential points of the proceedings and the results of the meeting. The minutes shall be kept by the Company along with the attendance list with signatures of the Directors in attendance and the proxy authorization forms for proxy attendees. Article 23: Supervisors of the Company shall exercise their right of supervision individually in accordance with applicable regulation. They may also attend the Board of Director meeting but are not eligible to vote.

Article 23-1: Directors and Supervisors of the Company shall be entitled to remuneration for their duties regardless of profit or loss. The Board of Directors is authorized to determine the remuneration within the standards for maximum salaries established in the Company's Remuneration Policy based on the level of their participation in the Company's operations and the value of their contribution. The Board of Directors may pay transportation allowances to Directors and Supervisors based on prevailing rates in the industry. Directors of the Company who work in the Company shall be entitled to monthly salaries in accordance with salary standards of regular managerial officers

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in addition to the Director or Supervisor compensation specified in Article 26 of these Articles of Incorporation.

Article 23-2: The Board of Directors is authorized to take out liability insurance for the Directors and Supervisors with respect to the liabilities resulting from exercising their duties during their term of office to reduce the risk of material damages to the Company and shareholders caused by illegal actions of its Directors or Supervisors.

Chapter 5 Managerial Officers and Staff

Article 24: The Company may appoint a number of managerial officers in accordance with applicable regulations. The appointment, dismissal and compensation of such managerial officers shall be governed by Article 29 of the Company Act.

Chapter 6 Final Accounts

Article 25: Article 25: The Board of Directors of the Company shall prepare the following documents at the end of each fiscal year, to be presented to the Supervisors for audit and confirmation 30 days prior to the general shareholders' meeting, and submitted to the general shareholders' meeting for adoption:
Business report.
Financial statements.
Proposal Concerning Distribution of Earnings or Offset of Losses
Article 26: In the event the Company makes profits (i.e. profit before tax and before compensation distribution to the employees, Directors, and Supervisors) in any fiscal year, it shall set aside 1% to 30% of the profits as employee compensation and no higher than 5% of the profits as Directors and Supervisors compensation. If there are cumulative losses, the Company shall reserve a sufficient amount to offset such losses. Employee and Directors and Supervisors compensation shall be resolved by a majority vote at a Board of Director meeting attended by two thirds of the total number of Directors and shall be reported to the shareholders' meeting. The Board of Directors may resolve to distribute employee compensation in stocks or cash and the recipients may include employees of subsidiaries of the Company meeting certain requirements set by the Board of Directors.
Article 26-1: The Company’s surplus earnings distribution or loss off-setting proposal may be proposed at the close of each half fiscal year.
Where the Company has a profit at the end of each half fiscal year, the Company shall estimate and reserve the taxes to be paid, offset losses according to regulation, estimate and reserve employees and Directors’ and Supervisors’ compensation, and allocate 10% as legal reserve, unless accumulated legal reserve has reached the total paid-in capital. Then, set aside or reverse a special reserve in accordance with relevant regulations or

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as requested by the competent authorities.

If a surplus remains, the balance combined with undistributed retained earnings from preceding periods shall be distributed according to the distribution plan proposed by the Board of Directors. If distributing in the form of new shares to be issued, the Company shall follow the provisions of Article 240 of the Company Act. If distributing in the form of cash, it shall be approved by the Board of Directors.’

Where there is a profit at the end of each fiscal year, besides payment of income tax and offset of losses in preceding years, the remaining shall be distributed as follows:

Allocate 10% as legal reserve, unless accumulated legal reserve has reached the total paid-in capital.
Where necessary, set aside or reverse a special reserve in accordance with relevant regulations.

If a surplus remains, the balance combined with undistributed retained earnings from preceding periods shall be distributed according to the distribution plan proposed by the Board of Directors.

If distributing in the form of new shares to be issued, the plan shall by submitted to the shareholders’ meeting for approval. If distributing in the form of cash, the Board of Directors shall adopt a resolution by a majority vote at a meeting attended by over two thirds of the Directors and report such distribution to the shareholders' meeting. Pursuant to Article 241 of Company Act, the Company may distribute its legal reserve and capital reserve, in whole or in part, by issuing new shares or by cash to its shareholders in proportion to the number of shares being held by each of them in the method specified above.

As the Company experiences constant changes in the business environment and is at a stage of stable growth, the Company’s dividend policy depends on factors such as future fund requirements, long-term financial plans, future capital expenditures and maximization of shareholder interests. The Company may retain a portion of earnings based on operational requirements and the remaining amount shall be distributed in cash and stock dividends. The amount of dividends distributed to shareholders shall be no less than 10% of distributable earnings of the current year, and no less than 30% of the shareholders’ dividends shall be in the form of cash.

Chapter 7 Supplemental Provisions

Article 27: The internal organizational rules and bylaws of the Company shall be established separately by the Board of Directors.
Article 28: Matters not addressed in these Articles of Incorporation shall be governed by the Company Act and other applicable regulations.
Article 29: These Articles of Incorporation were enacted and first amended on April 30, 1987. The 2nd amendment was made on March 22, 1989.
The 3rd amendment was made on August 30, 1990.

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The 4th amendment was made on January 15, 1992. The 5th amendment was made on July 29, 1992. The 6th amendment was made on September 29, 1992. The 7th amendment was made on October 29, 1992. The 8th amendment was made on May 10, 1993. The 9th amendment was made on May 22, 1993. The 10th amendment was made on July 3, 1993. The 11th amendment was made on March 2, 1994. The 12th amendment was made on April 20, 1997. The 13th amendment was made on June 6, 1997. The 14th amendment was made on July 15, 1997. The 15th amendment was made on October 15, 1997. The 16th amendment was made on February 10, 1998. The 17th amendment was made on June 10, 1998. The 18th amendment was made on June 30, 1998. The 19th amendment was made on May 15, 1999. The 20th amendment was made on July 15, 2000. The 21st amendment was made on September 23, 2000. The 22nd amendment was made on July 16, 2001. The 23rd amendment was made on November 9, 2001. The 24th amendment was made on June 28, 2002. The 25th amendment was made on June 9, 2003. The 26th amendment was made on June 11, 2004. The 27th amendment was made on June 14, 2005. The 28th amendment was made on June 14, 2006. The 29th amendment was made on June 15, 2007. The 30th amendment was made on June 13, 2008. The 31st amendment was made on June 10, 2009. The 32nd amendment was made on June 14, 2010. The 33rd amendment was made on June 9, 2011. The 34th amendment was made on June 18, 2012. The 35th amendment was made on June 10, 2015. The 36th amendment was made on June 8, 2016. The 37th amendment was made on June 12, 2018. The 38th amendment was made on June 12, 2019. The 39th amendment was made on August 25, 2021.

These Articles of Incorporation shall be effective and implemented following approval from the shareholders' meeting.

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Largan Precision Co., Ltd.

Chairman: En-Chou Lin

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Appendix II(Before Revision)

Largan Precision Co., Ltd.

"Procedures for the Acquisition or Disposal of Assets"

Chapter 1 General Provisions

Article 1 Purpose

To protect investments and implement information disclosure, the Company and its subsidiaries shall follow these Procedures in the acquisition or disposal of assets.

Article 2 Basis

The Procedures are established in accordance with Article 36-1 of the Securities and Exchange Act and (2002) Tai-Cai-Zheng (1) No. 0910006105 Letter of the Financial Supervisory Commission (hereinafter referred to as the FSC) dated December 10, 2002.

Article 3 The term “assets” as used in the Procedures includes the following:

I. Investments in stocks, government bonds, corporate bonds, financial bonds, securities representing interest in a fund, depositary receipts, call (put) warrants, beneficial interest securities, and asset-backed securities.
II. Real property (including land, houses and buildings, investment property, inventory in construction business) and equipment.
III. Memberships.
IV. Patents, copyrights, trademarks, franchise rights, and other intangible assets. V. Right-of-use assets.
VI. Derivatives.
VII. Assets acquired or disposed of in connection with mergers, demergers, acquisitions, or transfer of shares in accordance with law
VIII. Other major assets.

Article 4 Investment amount

The limits on the Company and its subsidiaries' acquisition of real property, right-of-use assets, or securities for non-business use shall be restricted to 60% of its total nominal assets (original investment amount). Investments in individual securities shall not exceed 50% of the aforementioned limit which equals 30% of total nominal assets.

Article 5 Terms used in the Procedures are defined as follows:

I. Derivatives: Forward contracts, options contracts, futures contracts, leverage contracts, or swap contracts, whose value is derived from a specified interest rate, financial instrument price, commodity price, foreign exchange rate, index of prices or rates, credit rating or credit index or other variable; or hybrid

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contracts combining the above contracts; or hybrid contracts or structured products containing embedded derivatives. The term "forward contracts" does not include insurance contracts, performance contracts, after-sales service contracts, long-term leasing contracts, or long-term purchase (sales) contracts.
II. Assets acquired or disposed of in connection with mergers, demergers, acquisitions, or transfer of shares in accordance with law: Refers to assets acquired or disposed through mergers, demergers, or acquisitions conducted under the Business Mergers and Acquisitions Act, Financial Holding Company Act, Financial Institution Merger Act and other acts, or to transfer of shares from another company through issuance of new shares of its own as the consideration therefor (hereinafter "transfer of shares") under Article 156-3 of the Company Act.
III. Related party and subsidiary: As defined in the Regulations Governing the Preparation of Financial Statements by Securities Issuers.
IV. Professional appraiser: Refers to a real property appraiser or other person duly authorized by law to engage in the value appraisal of real property or equipment.
V. Date of occurrence: Refers to the date of contract signing, date of payment, date of consignment trade, date of transfer, dates of Board of Directors resolutions, or other date that can confirm the counterpart and monetary amount of the transaction, whichever date is earlier; provided, for investment for which approval of the competent authority is required, the earlier of the above date or the date of receipt of approval by the competent authority shall apply.
VI. Mainland China area investment: Refers to investments in the mainland China area approved by the Ministry of Economic Affairs Investment Commission or conducted in accordance with the provisions of the Regulations Governing Permission for Investment or Technical Cooperation in the Mainland Area.
VII. Investment professional: Refers to financial holding companies, banks, insurance companies, bill finance companies, trust enterprises, securities firms operating proprietary trading or underwriting business, futures commission merchants operating proprietary trading business, securities investment trust enterprises, securities investment consulting enterprises, and fund management companies, that are lawfully incorporated and are regulated by the competent financial authorities of the jurisdiction where they are located.
VIII. Securities exchange: "Domestic securities exchange" refers to the Taiwan Stock Exchange Corporation; "foreign securities exchange" refers to any organized securities exchange market that is regulated by the competent securities authorities of the jurisdiction where it is located.
IX. Over-the-counter venue ("OTC venue", "OTC"): "Domestic OTC venue"

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refers to a venue for OTC trading provided by a securities firm in accordance with the Regulations Governing Securities Trading on the Taipei Exchange; "foreign OTC venue" refers to a venue at a financial institution that is regulated by the foreign competent authority and that is permitted to conduct securities business.

Article 6 Professional appraisers and their officers, certified public accounts, attorneys, and securities underwriters that provide the Company with appraisal reports, certified public accountant's opinions, attorney's opinions, or underwriter's opinions shall meet the following requirements:
I. May not have previously received a final and unappealable sentence to imprisonment for 1 year or longer for a violation of the Act, the Company Act, the Banking Act of The Republic of China, the Insurance Act, the Financial Holding Company Act, or the Business Entity Accounting Act, or for fraud, breach of trust, embezzlement, forgery of documents, or occupational crime. However, this provision does not apply if 3 years have already passed since completion of service of the sentence, since expiration of the period of a suspended sentence, or since a pardon was received.
II. May not be a related party or de facto related party of any party to the transaction.
III. If the Company is required to obtain appraisal reports from two or more professional appraisers, the different professional appraisers or appraisal officers may not be related parties or de facto related parties of each other. When issuing an appraisal report or opinion, the personnel referred to in the preceding paragraph shall comply with the following:
- (I) Prior to taking a case, they shall prudently assess their own professional capabilities, practical experience, and independence.
- (II) When examining a case, they shall appropriately plan and execute adequate working procedures, in order to produce a conclusion and use the conclusion as the basis for issuing the report or opinion. The related working procedures, data collected, and conclusion shall be fully and accurately specified in the case working papers.
- (III) They shall undertake an item-by-item evaluation of the comprehensiveness, accuracy, and reasonableness of the sources of data used, the parameters, and the information, as the basis for issuance of the appraisal report or the opinion.
- (IV) They shall issue a statement attesting to the professional competence and independence of the personnel who prepared the report or opinion, and that they have evaluated and found that the information used is reasonable and accurate, and that they have complied with applicable laws and regulations.

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Article 7 Operating procedures

The Company's assessments and decision making regarding the transaction conditions and prices for the acquisition or disposal of assets shall be conducted in accordance with the following regulations:
I. The Company's acquisition and disposal of assets specified in Article 3 of the Procedures for the Acquisition or Disposal of Assets that are long-term and short-term securities investments and derivatives shall be assessed and executed by the Finance Department; other assets other than those stated above shall be assessed and executed by relevant departments.
II. For securities other than those traded on Securities exchange or Over-the-counter venue, the transactions specified in the preceding paragraph shall be processed in accordance with the prevailing market prices and the price shall be determined through tenders, price comparison, or price negotiation.

Article 8 Duties of the Board of Directors, Audit Committee, Independent Directors and

Supervisors
I. With respect to any asset acquisition or disposal that is subject to the approval of the Board of Directors in accordance with the Procedures or other laws or regulation, if any Director expresses dissent and it is contained in the minutes or a written statement, the Company shall submit the Director's dissenting opinion to each Supervisor. If there are any objections or reservations expressed by an Independent Director, it shall be clearly recorded in the minutes of the board meeting.
II. Where an Audit Committee has been established, any transactions involving major assets or derivatives shall be approved by over one-half of all Audit Committee members and submitted to the Board of Directors for resolution. If approval of more than one-half of all Audit Committee members is not obtained, the approval by two-thirds or more of all Board of Directors members is required, and the resolution of the Audit Committee shall be recorded in the minutes of the Board of Directors meeting.
Chapter 2 Acquisition or Disposal of Assets

Article 9 Appraisal report

In acquiring or disposing of real property, equipment or right-of-use assets thereof where the transaction amount reaches 20% of the company's paid-in capital or NT$300 million or more, the Company, unless transacting with a domestic government agency, engaging others to build on its own land, engaging others to build on rented land, or acquiring or disposing of equipment held for business use, the Company shall obtain an

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appraisal report prior to the date of occurrence of the event from a professional appraiser and shall further comply with the following provisions:

I. Where it must adopt a limited price, designated price or special price as a reference basis for the transaction price due to extraordinary circumstances, the transaction shall be submitted for approval in advance by the Board of Directors; the same procedure shall also be followed whenever there is any subsequent to the terms and conditions of the transaction.
II. Where the transaction amount is NT$1 billion or more, appraisals from two or more professional appraisers are required.
III. Where any one of the following circumstances applies with respect to the professional appraiser's appraisal results, unless all the appraisal results for the assets to be acquired are higher than the transaction amount, or all the appraisal results for the assets to be disposed of are lower than the transaction amount, a certified public accountant shall be engaged to perform the appraisal in accordance with the provisions of Statement of Auditing Standards No. 20 published by the ROC Accounting Research and Development Foundation (ARDF) and render a specific opinion regarding the reason for the discrepancy and the appropriateness of the transaction price:
- (I) The discrepancy between the appraisal result and the transaction amount is 20% or more of the transaction amount.
- (II) The discrepancy between the appraisal results of two or more professional appraisers is 10% or more of the transaction amount.
IV. No more than three months may elapse between the date of the appraisal report issued by a professional appraiser and the contract execution date; provided, where the publicly announced current value for the same period is used and not more than six months have elapsed, an opinion may still be issued by the original professional appraiser.
Article 10 Evaluation of securities transactions
Where the Company acquires or disposes of securities, it shall obtain the financial statements of the issuing company for the most recent period which shall be certified or reviewed by a certified public accountant (CPA) as reference for the appraisal of the transaction price. Where the transaction amount reaches 20% or more of paid-in capital or NT$300 million or more, the Company shall additionally engage a CPA prior to the date of occurrence of the event to render an opinion on the reasonableness of the transaction price. Where the CPA requires the use of expert reports, it shall comply with the provisions of Statement of Auditing Standards No. 20 published by the ARDF. This requirement does not apply, however, to securities with publicly quoted prices from an active market, or if it has been otherwise provided by the regulations of the FSC.
Article 11 Where the Company acquires or disposes of assets through court auction procedures,

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the evidentiary documentation issued by the court may be used as a substitute for the appraisal report or CPA opinion.

Article 11-1 The calculation of the transaction amounts for the acquisition or disposal of assets shall be done in accordance with Article 28, Subsection 2 herein, and "within the preceding year" as used herein refers to the year preceding the date of occurrence of the current transaction. Items for which an appraisal report from a professional appraiser or a CPA's opinion has been obtained need not be counted toward the transaction amount.
Article 12 Level of Authority for the acquisition or disposal of assets The Board of Directors authorizes the Chairman to approve the Company's acquisition or disposal of assets; alternatively, the acquisition or disposal of assets may be conducted in accordance with the approved authority levels established by the Company.
Chapter 3 Related Party Transactions Article 13 When the Company engages in any acquisition or disposal of assets from or to a related party, in addition to ensuring that provisions in Chapter 2 and Chapter 3 of the Procedures and necessary resolutions are adopted and the reasonableness of the transaction terms is appraised, if the transaction amount reaches 10% or more of the Company's total assets, the Company shall also obtain an appraisal report from a professional appraiser or a CPA's opinion in accordance with provisions in Chapter 2. The calculation of the transaction amount referred to in the preceding paragraph shall be made in accordance with Article 11-1 herein.
Article 14 Duties of the Board of Directors, Audit Committee, Independent Directors, and Supervisors
I. When the Company intends to acquire or dispose of real property or right-of-use assets thereof from or to a related party, or when it intends to acquire or dispose of assets other than real property or right-of-use assets thereof from or to a related party and the transaction amount reaches 20% or more of paid-in capital, 10% or more of the Company's total assets, or NT$300 million or more, except in trading of domestic government bonds or bonds under repurchase and resale agreements, or subscription or redemption of money market funds issued by domestic securities investment trust enterprises, the company may not proceed to enter into a transaction contract or make a payment until the following matters have been approved by the board of directors and recognized by the supervisors:
- (I) The purpose, necessity and anticipated benefit of the acquisition or disposal of assets.
- (II) The reason for choosing the related party as a transaction counterparty.
- (III) With respect to the acquisition of real property or right-of-use assets

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thereof from a related party, information regarding appraisal of the reasonableness of the preliminary transaction terms in accordance with Article 15 and Article 16

(IV) The date and price at which the related party originally acquired the asset, the original transaction counterparty, and that transaction counterparty's relationship to the Company and the related party.
(V) Monthly cash flow forecasts for the year commencing from the anticipated month of signing of the contract, and evaluation of the necessity of the transaction, and reasonableness of the funds utilization.
(VI) An appraisal report from a professional appraiser or a CPA's opinion obtained in compliance with Article 13.
(VII) Restrictive covenants and other important stipulations associated with the transaction.
II. The calculation of the transaction amounts referred to in the preceding subsection shall be made in accordance with Article 28, Subsection 2 herein, and "within the preceding year" as used herein refers to the year preceding the date of occurrence of the current transaction. Items that have been approved by the Board of Directors and recognized by the Supervisors need not be counted toward the transaction amount.
III. With respect to the types of transactions listed below conducted between the Company and subsidiaries or between its subsidiaries in which the Company directly or indirectly holds 100% of the issued shares or authorized capital, the Company's Board of Directors may, pursuant to Article 12, delegate individuals to decide such matters when the transaction amount is under NT$300 million and have the decisions subsequently submitted to and ratified by the next Board of Directors meeting:
(I) Acquisition or disposal of equipment or right-of-use assets thereof held for business use.
(II) Acquisition or disposal of real property right-of-use assets held for business use.
IV. When proposed for discussion by the Board of Directors, any objections or reservations expressed by Independent Directors shall be detailed in the meeting minutes of the Board of Directors.
V. Where the Company has established an Audit Committee in accordance with laws, items subject to approval by the Supervisors in Subsection 1 of this Article shall require the approval of a majority of one-half of the Audit Committee first and they shall be submitted to the Board of Directors for resolution. If the approval of one-half of the Audit Committee members is not obtained, the Procedures may be implemented if approved by two-thirds or more of all Board of Directors members, and the resolution of the Audit

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Committee shall be recorded in the meeting minutes of the Board of Directors.

Article 15 Evaluation of transactions for acquiring real property or right-of-use assets from related parties
I. When the Company acquires real property or right-of-use assets thereof from a related party, it shall evaluate the reasonableness of the transaction costs by the following means:
(I) Based upon the related party's transaction price plus necessary interest on
funding and the costs to be duly borne by the buyer. "Necessary interest on funding" is imputed as the weighted average interest rate on borrowing in the year the Company purchases the property; provided, it may not be higher than the maximum non-financial industry lending rate announced by the Ministry of Finance.
- (II) If the related party has previously set up a mortgage on the property as security for a loan; provided, the actual cumulative amount loaned by the financial institution shall have been 70% or more of the financial institution's appraised loan value of the property and the period of the loan shall have been 1 year or more. However, this shall not apply where the financial institution is a related party of one of the transaction counterparties.
II. Where land and building thereupon are combined as a single property purchased or leased in one transaction, the transaction costs for the land and building may be separately appraised in accordance with either of the means listed in the preceding subsection.
III. Where the Company acquires real property or right-of-use assets thereof from a related party, the Company shall appraise the cost of the real property or right-of-use assets thereof in accordance with the two preceding subsections and engage a CPA to review the appraisal and render an opinion.
Article 16 Where the Company acquires real property or right-of-use assets thereof from a related party and one of the following circumstances exists, the acquisition shall be conducted in accordance with Article 14, and Article 15 shall not apply:
I. The related party acquired the real property thereof through inheritance or as a gift.
II. More than 5 years will have elapsed from the time the related party signed the contract to obtain the real property to the signing date for the current transaction.
III. The real property is acquired through signing of a joint development contract with the related party, or through engaging a related party to build real property, either on the company's own land or on rented land.

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IV. The real property right-of-use assets for business use are acquired by the Company or subsidiaries, or by its subsidiaries in which it directly or indirectly holds 100% of the issued shares or authorized capital.
Article 17 Exceptional cases where the transaction price does not comply with the normal course of operation
I. Where the results of appraisals conducted by the Company in accordance with Article 15, Subsection 1 and Subsection 2 are uniformly lower than the transaction price, the transaction shall be carried out in accordance with Article 18. However, where the following circumstances exist with objective evidence has been submitted and specific opinions on reasonableness have been obtained from a professional real property appraiser and a CPA, this restriction shall not apply:
- (I) Where the related party acquired undeveloped land or leased land for development, it may submit proof of compliance with one of the following conditions:
  - a. Where undeveloped land is appraised in accordance with the means in Article 15 and Article 16, and building is calculated according to the related party's construction cost plus reasonable construction profit, the combined amount in excess of the actual transaction price. The "reasonable construction profit" shall be deemed the average gross operating profit margin of the related party's construction division over the most recent 3 years or the gross profit margin for the construction industry for the most recent period as announced by the Ministry of Finance, whichever is lower.
  - b. Completed transactions by unrelated parties within the preceding year involving other floors of the same property or neighboring or closely valued parcels of land, where the land area and transaction terms are similar after calculation of reasonable price discrepancies in floor or area land prices in accordance with standard property market sale or leasing practices.
  - c. Leasing transactions by unrelated parties for other floors of the same property from within the preceding year, where the transaction terms are similar after calculation of reasonable price discrepancies among floors in accordance with standard property market sale or leasing market practices.
- (II) Where the Company acquiring real property, or obtaining real property right-of-use assets through leasing, from a related party provides evidence that the terms of the transaction are similar to the terms of completed transactions involving neighboring or closely valued parcels

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     - of land of a similar size by unrelated parties within the preceding year.

II. Transactions involving neighboring or closely valued parcels of land in principle refers to parcels on the same or an adjacent block and within a distance of no more than 500 meters or parcels close in publicly announced current value; transactions involving similarly sized parcels in principle refers to transactions between unrelated parties for parcels with a land area of no less than 50% of the property in the planned transaction; within the preceding year refers to the year preceding the date of occurrence of the acquisition of the real property or obtainment of the right-of-use assets thereof.
Article 18 Items to be processed if the transaction price does not comply with the normal course of operation
I. Where the Company acquires real property from a related party and the results of appraisals conducted in accordance with Article 15, Article 16, and Article 17 are uniformly lower than the transaction price, the following steps shall be taken:
- (I)A special reserve shall be set aside in accordance with Article 41, Paragraph 1 of the Securities and Exchange Act against the difference between the real property or right-of use asset transaction price and the appraised cost, and may not be distributed or used for capital increase or issuance of stock dividends. Where the Company uses the equity method to account for its investment in another company, then the special reserve called for under Article 41, Paragraph 1 of the Securities and Exchange Act shall be set aside pro rata in a proportion consistent with the share of the Company's equity stake in the other company if it meets transaction conditions specified in this item.
- (II) The Supervisors shall comply with Article 218 of the Company Act and supervise the Company's execution of the actions specified in the preceding item of this subsection. Where an Audit Committee has been established in accordance with the provisions of the Act, the preceding part of this item shall apply mutatis mutandis to the Independent Director
- (III) Actions taken pursuant to the preceding two items shall be reported to the shareholders' meeting and the details of the transaction shall be disclosed in the annual report and any investment prospectus.
II. If the Company has set aside a special reserve under the preceding subsection, it shall not draw on the reserve unless it has recognized the loss on decline in market value of the assets it purchased at a premium; terminated the lease contract; has disposed of the assets or made adequate compensation; or has restored the status quo ante; or there is other evidence confirming that there was nothing unreasonable about the transaction. Agreement from the

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competent authority of securities is also required.

III. The rules specified in the two preceding subsections shall also be followed if there is other evidence showing nonconformity with general business practices when the Company acquires real property or right-of-use assets thereof from a related party.

Chapter 4 Transaction in Derivatives

Article 19 The Company shall process derivatives trading in accordance with the Company's "Procedures for Engaging in Derivatives Trading". It shall also pay attention to risk management and auditing matters to implement the internal control system.
Chapter 5 Mergers and Consolidations, Demergers, Acquisitions, and Transfer of Shares
Article 20 When engaged in mergers, demergers, acquisitions or share transfers, the Company shall, before convening a Board of Directors meeting to approve such matter, engage a CPA, attorney or securities underwriter to provide opinions on the reasonableness of the share exchange ratio, acquisition price, the cash or other property to be distributed to shareholders, etc. The proposal shall be submitted to the Board of Directors for deliberation and approval. However, the requirement of obtaining an aforesaid opinion on reasonableness issued by an expert may be exempted in the case of the Company's merger of a subsidiary in which it directly or indirectly holds 100% of the issued shares or authorized capital, and in the case of a merger between subsidiaries in which the Company directly or indirectly holds 100% of the respective subsidiaries' issued shares or authorized capital.
Article 21 When the Company participates in a merger, demerger, or acquisition, it shall prepare a public report to shareholders detailing important contractual content and matters relevant to the merger, demerger, or acquisition prior to the shareholders' meeting and include it along with the expert opinion referred to in Article 20 when sending shareholders notification of the shareholders' meeting for reference in deciding whether to approve the merger, demerger, or acquisition. Provided, where a provision of another act exempts a company from convening a shareholders' meeting to approve the merger, demerger, or acquisition, this restriction shall not apply. Where the shareholders' meeting of any one of the companies participating in a merger, demerger, or acquisition fails to convene or pass a resolution due to lack of a quorum, insufficient votes, or other legal restriction, or the proposal is rejected by the shareholders' meeting, the Company shall immediately publicly explain the reason, the follow-up measures, and the preliminary date of the next shareholders' meeting.
Article 22 When participating in a merger, demerger, or acquisition, the Company shall convene a Board of Directors meeting and shareholders' meeting on the day of the transaction

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along with other participating companies to resolve matters relevant to the merger, demerger, or acquisition, unless another act provides otherwise or the competent authority of securities is notified in advance of extraordinary circumstances and grants consent. When participating in a transfer of shares, the Company shall call a Board of Directors meeting on the day of the transaction along with other participating companies, unless another act provides otherwise or the competent authority of securities is notified in advance of extraordinary circumstances and grants consent.

When participating in a merger, demerger, acquisition, or transfer of another company's shares, the Company shall prepare a full written record of the following information and retain it for 5 years for reference: The Company shall, within 2 days counting inclusively from the date of passage of a resolution by the Board of Directors, report the information set out in Subsection 1 and Subsection 2 below in the prescribed format and via the Internet-based information system to the FSC for recordation:

I. Basic identification data for personnel: Including the occupational titles, names, and ID numbers (or passport numbers in the case of foreigners) of all persons involved in the planning or implementation of any merger, demerger, acquisition, or transfer of another company's shares prior to disclosure of the information.
II. Dates of material events: Including the signing of any letter of intent or memorandum of understanding, the hiring of financial or legal advisor, the execution of a contract, and the convening of a Board of Directors meeting.
III. Important documents and minutes: Including merger, demerger, acquisition, and share transfer plans, any letter of intent or memorandum of understanding, material contracts, and minutes of Board of Directors meetings.
Where any of the transaction counterparties participating in a merger, demerger, acquisition, or transfer of another company's shares is neither listed on an exchange nor has its shares traded on an OTC market, the Company shall sign an agreement with such company whereby the latter is required to abide by the provisions of this Article.
Article 23 Every person participating in or privy to the plan for merger, demerger, acquisition, or transfer of shares shall issue a written undertaking of confidentiality and may not disclose the content of the plan prior to public disclosure of the information and may not trade, in their own name or under the name of another person, in any stock or other equity security of any company related to the plan for merger, demerger, acquisition, or transfer of shares.
Article 24 When participating in a merger, demerger, acquisition, or transfer of shares, the Company may not arbitrarily alter the share exchange ratio or acquisition price unless

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under the circumstances listed below, and shall stipulate the circumstances permitting alteration in the contract for the merger, demerger, acquisition, or transfer of shares:

I. Cash capital increase, issuance of convertible corporate bonds, or the issuance of bonus shares, issuance of corporate bonds with warrants, preferred shares with warrants, stock warrants, or other equity-based securities.
II. An action, such as a disposal of major assets, that affects the Company's financial operations.
III. An event, such as a major disaster or major change in technology, that affects shareholder equity or share price.
IV. An adjustment where any of the companies participating in the merger, demerger, acquisition, or transfer of shares from another company, buys back treasury stock.
V. An increase or decrease in the number of entities or companies participating in the merger, demerger, acquisition, or transfer of shares.
VI. Other terms/conditions that the contract stipulates may be altered and that have been publicly disclosed.
Article 25 The contract for participation by the Company in a merger, demerger, acquisition, or transfer of shares shall record the rights and obligations of the companies participating in the merger, demerger, acquisition, or transfer of shares, and shall also record the following:
I. Handling of breach of contract.
II. Principles for the handling of equity-type securities previously issued or treasury stock previously bought back by any company that is extinguished in a merger or that is demerged.
III. The amount of treasury stock participating companies is permitted under law to buy back after the record date of calculation of the share exchange ratio, and the principles for handling thereof.
IV. The manner of handling changes in the number of participating entities or companies.
V. Preliminary progress schedule for plan execution, and anticipated completion date.
VI. The relevant procedures of the expected convening dates of shareholders' meeting based on laws when a plan is overdue and still not completed.
Article 26 After public disclosure of the information, if the Company intends further to carry out a merger, demerger, acquisition, or transfer of shares with another company, all of the participating companies shall carry out anew the procedures or legal actions that had originally been completed toward the merger, demerger, acquisition, or transfer of shares; except that where the number of participating companies is decreased and a

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participating company's shareholders meeting has adopted a resolution authorizing the Board of Directors to alter the limits of authority, such participating company may be exempted from calling another shareholders meeting to resolve on the matter anew.

Article 27 Where any of the companies participating in a merger, demerger, acquisition, or transfer of shares is not a public company, the Company shall sign an agreement with the non-public company whereby the latter is required to abide by the provisions of Article 22, Article 23, and Article 26.

Chapter 6 Information Disclosure

Article 28 Items that require public announcement and regulatory filing

I. When acquiring or disposing of assets, the Company shall publicly announce and report the relevant information on the website designated by the competent authority of securities in the appropriate format as prescribed by regulations of the FSC within 2 days counting inclusively from the date of occurrence of the event under any of the following circumstances:
(I) Acquisition or disposal of real property or right-of-use assets thereof from or to a related party, or acquisition or disposal of assets other than real property or right-of-use assets thereof from or to a related party where the transaction amount reaches 20% or more of paid-in capital, 10% or more of the Company's total assets, or NT$300 million or more; provided, this shall not apply to trading of domestic government bonds or bonds under repurchase and resale agreements, or subscription or redemption of money market funds issued by domestic securities investment trust enterprises.
(II) Merger, demerger, acquisition, or transfer of shares.
(III) Losses from derivatives trading reaching the limits on aggregate losses or losses on individual contracts.
(IV) Where equipment or right-of-use assets thereof for business use are acquired or disposed with a transaction counterparty that is not a related party and the transaction amount reaches NT$500 million or more.
(V) Where land is acquired under an arrangement on engaging others to build on the company's own land, engaging others to build on rented land, joint construction and allocation of housing units, joint construction and allocation of ownership percentages, or joint construction and separate sale, and furthermore the transaction counterparty is not a related party, and the amount the company expects to invest in the transaction reaches NT$500 million or more.
(VI) Where an asset transaction other than any of those referred to in this subsection, a disposal of receivables by a financial institution, or an

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investment in the mainland China area reaches 20% or more of paid-in capital or NT$300 million; provided, this shall not apply to the following circumstances:

     - a. Trading of domestic government bonds.

     - b. Trading of bonds under repurchase and resale agreements, or subscription or redemption of money market funds issued by domestic securities investment trust enterprises.

II. The amount of transactions in the previous subsection shall be calculated as follows:
- (I) The amount of any individual transaction.
- (II)The cumulative transaction amount of acquisitions and disposals of the same type of underlying asset with the same trading counterparty within the preceding year.
- (III)The cumulative transaction amount of acquisitions and disposals (cumulative acquisitions and disposals, respectively) of real property or right-of-use assets thereof within the same development project within the preceding year.
- (IV)The cumulative transaction amount of acquisitions and disposals (cumulative acquisitions and disposals, respectively) of the same security within the preceding year.
- (V)The "within one year" mentioned in this subsection shall refer to the one year preceding the date of occurrence of the current transaction. Items duly announced in accordance with the Procedures need not be counted toward the transaction amount.
Article 29 When the Company at the time of public announcement of the acquisition or disposal of assets makes an error or omission in an item required by regulations to be publicly announced and so is required to correct it, all the items shall again be publicly announced and reported in their entirety within two days of learning the error or omission.
Article 30 When acquiring or disposing of assets, the Company shall keep at the Company all relevant contracts, meeting minutes, log files, appraisal reports and opinions of the certified public accountant, attorney and securities underwriter which they shall be retained for five years, except where another law provides otherwise.
Article 31 Where any of the following circumstances occurs with respect to a transaction that the Company has already publicly announced and reported in accordance with Article 28, Article 29, and Article 30, a public report of relevant information shall be made on the website designated by the competent authority of securities within two days counting

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inclusively from the date of occurrence of the event:

I. Change, termination, or rescission of a contract signed in regard to the original transaction.
II. The merger, demerger, acquisition, or transfer of shares is not completed by the scheduled date set forth in the contract.
III. Change to the originally publicly announced and reported information.

Article 32 Items to be disclosed in financial statements

Where the Company's acquisition or disposal of assets reaches criteria for public announcement and publication in accordance with Article 28 in the Procedures, and the counterparty to such transaction is a de facto related party, the Company shall disclose the published contents in the notes of the financial statements and report to the shareholders' meeting.

Chapter 7 Supplemental Provisions

Article 33 Items that require public announcement and regulatory filing by subsidiaries
I. In the event that a subsidiary is not a domestic publicly listed company, the Company shall, on behalf of the subsidiary, carry out relevant information announcement and reporting when the acquisition or disposal of assets by such subsidiary is within the scope of Chapter 6 herein.
II. With regard to the threshold for announcement or reporting by subsidiaries prescribed in Article 28, Subsection 1 regarding the 20% of paid-in capital or 10% of total assets, the calculation basis for the threshold shall be the paid-in capital or total assets of the Company.
Article 34 The Company shall ensure that subsidiaries establish and implement the "Procedures for the Acquisition or Disposal of Assets".
Article 35 Any employee of the Company who violates these Procedures shall be subject to disciplinary actions in accordance with the relevant human resources management policies of the Company.
Article 36 For the calculation of 10% of total assets under these Procedures, the total assets stated in the most recent parent company only financial statements or individual financial statements prepared under the Regulations Governing the Preparation of Financial Statements by Securities Issuers shall be used.

Article 37 Implementation and revision

I. The Procedures shall first be passed by the Board of Directors and delivered to all Supervisors before it is submitted to the shareholders' meeting for approval and

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implementation. The same shall apply to any amendment. If a Director expresses objection and records or written statements are available, the information regarding the Director's objection shall be submitted to the Supervisors. If there are any objections or reservations expressed by an Independent Director, it shall be clearly recorded in the minutes of the board meeting.

II. Where an Audit Committee has been established, the establishment or revision of the Procedures shall first be approved by one-half of all Audit Committee members and it shall be submitted to the Board of Directors for resolution. If the approval of at least one-half of all members of the Audit Committee is not obtained, the Procedures may be implemented if approved by at least two-thirds of all Directors, and the resolution of the Audit Committee shall be recorded in the minutes of the Board of Directors meeting.
Article 38 Any matters not set forth in these Procedures shall be handled in accordance with the related laws and regulations.

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Appendix III(Before Revision)

Largan Precision Co., Ltd.

"Procedures for Engaging in Derivatives Trading"

Article 1 Purpose and basis

To facilitate information disclosure and enhance the Company's risk management system for derivatives transactions, the Company established the Procedures in accordance with (2002) Tai-Cai-Zheng (1) No. 0910006105 Letter of the Securities and Futures Institute (hereinafter as SFI) of the Ministry of Finance dated December 10, 2002.

Article 2 Definitions and scope of application

I. The "derivatives" specified in these Procedures refer to forward contracts, options contracts, futures contracts, leverage contracts, or swap contracts, whose value is derived from a specified interest rate, financial instrument price, commodity price, foreign exchange rate, index of prices or rates, credit rating or credit index, or other variable; or hybrid contracts combining the above contracts; or hybrid contracts or structured products containing embedded derivatives.
II. The term "forward contracts" in these Procedures does not include insurance contracts, performance contracts, after-sales service contracts, long-term leasing contracts, or long-term purchase (sales) contracts.
III. Bond margin trading shall also be governed by these Procedures.
Article 3 Transaction categories
- Transactions related to interest rate, exchange rate, or other subjects including spot trading, forward contracts, options, packaged investment products, and other derivatives.

Article 4 Hedging strategy

The foreign exchange operations conducted through the products specified in the preceding article are only conducted to evade foreign exchange risks in operations and fund allocation. The Company may not conduct any opportunist transactions and the currencies held by the Company must meet the Company's actual foreign currency requirements for import/export.

Article 5 Division of powers and responsibilities

The finance planning team is responsible for formulating and executing strategies for derivatives transactions and regular assessments and reports on the Company's positions. The Board of Directors assigns senior management personnel from outside the finance planning team to take charge of the assessment, supervision, and control of related risks.

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Article 6 Performance evaluation guidelines

The finance planning team shall evaluate the operating performance every week based on market prices and it shall regularly report to the Chairman every month to review the hedging strategy it has adopted.

Article 7 Total contract value

The total value of forward foreign exchange transaction contracts shall not exceed the Company's total demand for foreign currencies in actual import/export operations. When a foreign currency option transaction is evaluated based on the market price, the total amount of the transaction contract for the exercise of the option that the Company may be required to perform shall not be more than US$10 million.

Article 8 Upper limit on losses for all individual contracts

Losses from derivatives transaction contracts shall not exceed 15% of the contract price. This restriction shall be applicable to any individual contract and all contracts.

Article 9 Amount and levels of authority delegated and unit responsible for implementation The finance planning team shall evaluate and select financial institutions with superior conditions and sign credit limit contracts after obtaining approval from the Chairman of the Board. It shall also perform derivatives transactions within the limit.

Article 10 Operating procedures

I. After the completion of a derivatives transaction and confirmation by the confirmation personnel, the settlement personnel shall be notified immediately.
II. The settlement personnel shall perform settlement procedures in accordance with the notice provided by the confirmation personnel.
III. The Company shall establish a log book for its derivatives transactions, which shall contain details for record about the type and amount of the derivative transactions and the date resolved by the Board of Directors, and also include other items to be evaluated in accordance with regulations.

Article 11 Public announcement and regulatory filing

After the completion of a derivatives transaction and confirmation by the confirmation personnel, the transaction shall be reported in accordance with related regulations. The Company shall compile monthly reports on the status of derivative transactions conducted up to the end of the preceding month by itself and any of its subsidiaries that are not publicly-listed companies in Taiwan. The information shall be transmitted to the information reporting website specified by the SFI before the 10th of each month using the required format.

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Article 12 Accounting procedures

I. The finance planning team shall immediately deliver cash income and expenditures derived from foreign exchange operations to the accounting unit of the Finance Department for accounting.
II. Unless otherwise specified in these Procedures, the Company's accounting methods for derivatives transactions shall be based on related regulations of the accounting system.

Article 13 Internal control

I. The personnel that deal with derivatives transaction, make confirmation of these transactions and make settlements of these transactions shall not be the same.
II. The scope of risk management shall include credit, market price, fluidity, cash flow volume, operations and legal risks. Risk measurement, monitoring, and control personnel shall be assigned to a different department that the personnel in the preceding paragraph and shall report to the Board of Directors or senior management personnel with no responsibility for trading or position decision-making.
III. The Company shall assess its derivative transaction positions at least once a week. Hedging transactions conducted to meet business requirements shall be assessed at least twice a month. Assessment reports shall be presented to the senior management personnel authorized by the Board of Directors.
IV. The senior management personnel authorized by the Board of Directors shall pay close attention to the supervision and control of risks in derivatives transactions at all times. They shall periodically assess whether the performance of derivatives transactions meet established management strategies and whether the undertaken risks are within the range acceptable to the Company. They shall also periodically evaluate whether the current risk management measures are appropriate and whether they have been carried out in accordance with related regulations in the Procedures.
V. When irregular circumstances are found in the course of supervising trading and profit-loss circumstances, appropriate measures shall be adopted and a report immediately made to the Board of Directors; and an Independent Director shall be present at the meeting and express an opinion.

Article 14 Internal audit

Internal audit personnel shall periodically make a determination of the suitability of internal controls on derivatives and conduct a monthly inspection of how faithfully derivatives trading by the trading department adheres to the procedures for engaging in derivatives trading, and prepare an audit report. If any material violation is discovered, all Supervisors and Independent Directors shall be notified in writing, and related personnel shall be penalized commensurate with the violation.

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Article 15 Enforcement and amendment

The Procedures shall first be passed by the Board of Directors and delivered to all Supervisors before it is submitted to the shareholders' meeting for approval. The same shall apply to any amendment. If a Director expresses objection and records or written statements are available, the Company shall submit information regarding the Director's objection to Supervisors.

In addition, the opinions of Independent Directors shall be taken into full consideration in discussions in the Board of Directors meeting on these Procedures in accordance with the preceding paragraph. Independent Directors’ assenting or dissenting opinions and reasons of dissent shall be included in the meeting minutes.

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Appendix IV(Before Revision)

Largan Precision Co., Ltd.

"Rules for Loaning of Funds"

Article 1 Purpose

To facilitate information disclosure and enhance the Company's risk management system for loaning funds to others, the Company's loans to others shall be processed in accordance with these Procedures.

Article 2 Eligible entities

According to Article 15 of the Company Act, the Company shall not loan funds to shareholders or any other person except under the following circumstances:
I.Entities that conduct business transactions with the Company.

II.Where an inter-company short-term financing facility with the Company is necessary. The term "short-term" as used means one year, or where the Company's operating cycle exceeds one year, one operating cycle.

III.Loans between foreign companies in which the Company holds, directly or indirectly, 100% of the voting shares or loans provided by foreign companies, in which the Company holds, directly or indirectly, 100% of the voting shares, to the Company.

Article 3 Evaluation standards for loaning funds to others

I. Where the Company provides loans to a company or firm with which it does business, the loans shall be provided in accordance with Article 4 paragraph 2.
II. Where a loan is provided due to short-term financing needs, it shall be restricted to the following circumstances:
- (1) Where it is necessary for foreign companies in which the Company holds, directly or indirectly, 100% of the voting shares to have a short-term financing loan.
- (2) A company or firm that requires short-term financing due to procurement of materials or operation turnover requirements.
- (3) Other situations where the Board of Directors of the Company agrees to the loan.
Article 4 Aggregate amount of loans and the maximum amount permitted to a single borrower
I. The Company's total loans shall not exceed 40% of the Company’s net worth.
II. Individual loans to a company or firm with which the Company does business shall be limited to the transaction amount between both parties. The transaction amount means the sales or purchasing amount between the parties, whichever is higher.
III. The restriction regarding 40% of the lender's net worth or the financing period of one year or one operating cycle shall not apply to inter-company loans of funds between

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foreign companies in which the Company holds, directly or indirectly, 100% of the voting shares if the loan is required for short-term financing purposes. The loan period shall be in accordance with Article 8 paragraph 1.

Article 5 Implementation and credit assessment procedures

I. In the Company's processing of loans, the borrower shall be required to submit necessary company information and financial information and file a written application to the Company for a loan limit.
II. After the Company receives the application, the Finance Department shall investigate and assess the business operated by the borrower, its financial position, solvency, credit, profitability, and purpose of the loan and prepare a report.
III. The Finance Department shall investigate and carefully assess the recipients of loans, and the evaluation shall include at least the following:
(1) Necessity and rationality for loans to others.
(2) Assessment of whether the loan and the amount are necessary based on the financial status of the borrower.
(3) Verification of whether the accrued loan amount is within the limit.
(4) Impact on the Company's business operations, financial status and shareholders' interest.
(5) Whether collateral must be obtained and appraisal of the value thereof.
(6) The borrower's credit assessment and risk evaluation.

Article 6 Security procedures

When the Company processes a loan, it shall obtain a guarantee note of equivalent value. When necessary, the Company shall obtain and record liens on chattel or real property. Where the borrower provides individuals or companies as proof of equivalent financial means and credit in lieu of collaterals for the aforementioned debt, the Board of Directors may consider the opinions of the Finance Department for implementation; where a company is used as a guarantee, the Company shall pay attention to whether provisions for guarantees are established in its articles of incorporation.

Article 7 Scope of authorization

I. In the Company's processing of loans, after the credit assessment by the Finance Department of the Company, the application shall be submitted to the Chairman for approval and submitted to the Board of Directors for resolution to be implemented and cannot be delegated to other individuals to determine such matters.
II. For funds loaning between the Company and its subsidiaries, or between the subsidiaries of the Company, the matter shall in accordance with the preceding paragraph be submitted to the Board of Directors for resolution. Additionally, the Chairman may be authorized to provide the loans in installment or revolver for a

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period of not more than one year to the same entity receiving the loan, provided that the amount of the loan is within the specific amount resolved upon by the Board of Directors.

III. The specific amount specified in the preceding paragraph shall meet requirements in Article 2 paragraph 3. In addition, the loan limit authorized by the Company or its subsidiaries to any single company shall not exceed 10% of the Company's net worth on its most current financial statements.

Article 8 Duration of loans and calculation of interest

I. As a principle, the duration of each loan shall not exceed 180 days. In the event of special circumstances, the duration of the loan may be extended, based on actual requirements, with the approval of the Board of Directors.
II. The loan interest rate shall not be lower than the Company's highest interest rate for short-term loans from financial institutions. As a principle, the calculation of loan interest shall be calculated on a monthly interest repayment basis. In the event of special circumstances, adjustments may be provided with the approval of the Board of Directors based on actual requirements.

Article 9 Post-loan management measures and overdue loan processing procedures

I. After the loans are allocated, the Company shall pay attention to the finance, business, and related credit status of the borrower and guarantor. Where collateral is provided, it shall pay attention to changes in the value of the collateral. In the event of material changes, it shall immediately report to the Chairman and follow instructions for handling the matter.
II. When the borrower repays the loan upon the expiry date or in advance, the payable interest shall be calculated and repaid along with the principal before the Company may rescind and return the promissory note to the borrower or release the liens.
III. The Borrower shall immediately repay the principal and interest on the expiry date of each loan. Where the loan cannot be repaid upon expiry, the borrower shall file a request in advance and the loan may be extended with the approval of the Board of Directors. The extension of each loan shall not exceed three months and only one extension may be granted. In the case of a violation, the Company may take actions in accordance with applicable laws to seek compensation from the collateral or guarantors provided by the borrower.

Article 10 Internal control

I. The Company shall establish log books for loans and register the borrower, the amount, the date of passage by the Board of Directors, the date of the loan, and the matters to be carefully evaluated in accordance with the rules.
II. Where a change in the Company causes the amount to exceed the limit, a rectification

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plan shall be formulated and delivered to the Supervisors and Independent Directors to enhance internal control and management of the Company.

III. The Company's loans to others shall be processed in accordance with the rules and procedures. In the event when a material violation is found, related personnel shall be penalized commensurate with the violation.
IV. Where a change in the Company causes the borrower to be incompatible with this Rules or causes the amount to exceed the limit, a rectification plan shall be formulated, delivered to the Supervisors and Independent Directors, reported to the Board of Directors, and implemented to complete rectification based on the timeframe set out in the plan.

Article 11 Internal audit

The Company's internal auditors shall audit the operation procedures of loaning funds to others and the implementation thereof no less frequently than quarterly and prepare written records accordingly. They shall promptly notify the Supervisors and Independent Directors in writing of any material violation found, if any.

Article 12 Public announcement and regulatory filing

I. The Company shall publicly announce and file the previous month's balance of the Company’s and its subsidiaries’ loans to others before the 10th day of each month.
II. Where the Company's balance of loans reaches one of the following levels, the Company shall announce and report such event within two days commencing immediately from the date of occurrence:
(1) The balance of loans to others reaches 20% or more of the Company's net worth as specified in the Company latest financial statements.
(2) The balance of loans for a single company reaches 10% or more of the Company's net worth as stated in the latest financial statements.
(3) The amount of new loans made by a public company or its subsidiaries reaches NT$10 million or more, and reaches 2% or more of the public company's net worth as stated in its latest financial statement.
(4) The Company shall announce and report on behalf of any subsidiary thereof that is not a public company of the Republic of China any matters that such subsidiary is required to announce and report pursuant to the preceding subsections.

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Article 13 Other items

I. The Company shall evaluate the conditions of the loans and set aside adequate reserve for bad debts. It shall also adequately disclose related information in its financial reports and provide related information to the certified public accountant for implementation of necessary auditing procedures and submission of a suitable audit report.
II. Any matters that are not addressed herein shall be governed by relevant laws and the Company's related regulations.

Article 14 Enforcement and amendment

Once this Rules are passed by the Board of Directors, they shall be submitted to the Supervisors and reported to the shareholders' meeting for consent. If a Director expresses objection and records or written statements are available, information regarding the Director's objection shall be submitted to Supervisors and to the shareholders' meeting for discussion. The same shall apply to any revision.

When the Rules for Loaning of Funds is submitted to the Board of Directors for discussions in accordance with the preceding paragraph, the opinions of Independent Directors shall be taken into full consideration. If any Independent Director has any dissenting opinion or qualified opinion, it shall be noted in the minutes of the Board of Directors meeting.

Article 15 Control and management procedures for subsidiaries' loans to others

I. Where a subsidiary of the Company intends to extend loans to other entities, the Company shall order the subsidiary to establish the Rules for Loaning of Funds in accordance with the "Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies" enacted by the competent authority and process loans in accordance with the operating procedures specified therein.
II. When a subsidiary extends loans to other entities, it shall provide related information to the parent company and consider the opinions of the parent company's related personnel before processing the loan.
III. After a subsidiary loans a fund, it shall regularly report the follow-up status of loaned funds to the parent company.

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Appendix V(Before Revision)

Largan Precision Co., Ltd.

"Rules for Endorsements/Guarantees"

Article 1 Purpose

To facilitate information disclosure and enhance the Company's risk management system for endorsements/guarantees, the Company's endorsements/guarantees shall be processed in accordance with these Rules.

Article 2 Definitions and scope of application

The term "endorsements/guarantees" or “endorsement/guarantee” as used in these Rules refers to the following:

I. Financing endorsements/guarantees.
(1) Bill discount financing.
(2) Endorsement/guarantee made to meet the financing needs of another company.
(3) Issuance of a separate negotiable instrument to a non-financial enterprise as security to meet the financing needs of the Company itself.
II. Customs duty guarantee refers to endorsement/guarantee for the Company itself or another company with respect to customs duty matters.
III. Other endorsements/guarantees that cannot be classified into the above items.
IV. Any creation by the Company of a pledge or mortgage on its chattel or real property as security for the loans of another company.

Article 3 Recipient of endorsement/guarantee

I. Besides cases where the Company fulfills its contractual obligations by providing mutual endorsements/guarantees for another company in the same industry for purposes of undertaking a business project or where all capital contributing shareholders make endorsements/guarantees for their jointly invested company in proportion to their shareholding percentages, other recipients of endorsements/guarantees shall be restricted to the following companies:
(1) A company with which it does business.
(2) A company in which the Company directly and indirectly holds more than 50% of the voting shares.
(3) A company that directly and indirectly holds more than 50% of the voting shares of the Company.
II. Endorsements/guarantees may be made between companies in which the Company holds, directly or indirectly, more than 90% of the voting shares. The amount may not exceed 10% of the net worth of the Company, provided that this restriction shall not

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apply to endorsements/guarantees made between companies in which the Company holds, directly or indirectly, 100% of the voting shares.

Article 4 Limits of endorsement/guarantee

I. The total amount of endorsements/guarantees provided by the Company shall not exceed 40% of the Company’s net worth. The maximum endorsements/guarantees for a single enterprise, except for companies in which the Company holds 100% of the voting shares, shall not exceed 10% of the Company’s net worth.
II. The Company and subsidiaries' total endorsements/guarantees for external entities shall not exceed 40% of the Company’s net worth. The maximum endorsements/guarantees for a single enterprise shall not exceed 10% of the Company’s net worth. The net worth shall be based on the most current financial statements audited or reviewed by the certified public accountants.
III. Where the Company provides endorsements/guarantees due to business transactions, besides the restrictions specified above, the amount shall further not exceed the transaction amount between the parties. The transaction amount means the sales or purchasing amount between the parties, whichever is higher.

Article 5 Decision-making and authorization level

I. The Company's endorsements/guarantees must be approved in a resolution of the Board of Directors before implementation. If the Company has established the position of Independent Director, the opinions of each Independent Director shall be taken into full consideration and Independent Director’s opinions specifically expressing assent or dissent and the reasons for dissent shall be included in the minutes of the Board of Directors' meeting.
II. The Board of Directors may authorize the Chairman to decide such matters for endorsements/guarantees within NT$20 million in accordance with related provisions herein and have the decisions subsequently submitted to the next Board of Directors meeting for ratification and reported to the shareholders' meeting for the record.
III.Where a company in which the Company holds, directly or indirectly, more than 90% of the voting shares provides endorsements/guarantees in accordance with Article 3, paragraph 2, it shall submit the proposal to the Board of Directors for approval before implementation, provided that this restriction shall not apply to endorsements/guarantees made between companies in which the Company holds, directly or indirectly, 100% of the voting shares.
IV.Where the Company needs to exceed the limits set out in this Rules to satisfy its business requirements, and where the conditions set out in this Rules are complied with, it shall obtain approval from the Board of Directors and half or more of the Directors shall act as joint guarantors for any loss that may be

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caused to the company by the excess endorsement/guarantee. It shall also amend the Rules for Endorsements/Guarantees accordingly and submit the same to the shareholders' meeting for ratification after the fact. If the shareholders' meeting does not give consent, the company shall adopt a plan to discharge the amount in excess within a given time limit. Where the Company has established the position of independent director, when it makes endorsements/guarantees for others, it shall take into full consideration the opinions of each independent director; independent directors' opinions specifically expressing assent or dissent and the reasons for dissent shall be included in the minutes of the board of directors' meeting.

Article 6 Implementation and credit investigation procedures

I. When the Company processes an endorsement/guarantee, the recipient of endorsement/guarantee shall submit an application form and file an application to the Finance Department of the Company. The Finance Department shall conduct a credit investigation on the recipient of endorsement/guarantee, evaluate the risks, and prepare evaluation records. Once they are reviewed, they shall be presented to the CEO and Chairman for approval. Where necessary, the Company shall be required to obtain collateral.
II. The Finance Department shall conduct a credit investigation and risk assessment on the recipient of endorsement/guarantee and the evaluation shall include the following:
(1) The necessity and rationality of endorsements/guarantees;
(2) Assessment of whether the endorsement/guarantee and the amount are necessary based on the financial status of the recipient of endorsement/guarantee.
(3) Verification of whether the accrued endorsement/guarantee amount is within the limit.
(4) Where the Company provides endorsements/guarantees due to business transactions, it shall assess whether the amount of the endorsements/guarantees is within the limit.
(5) Impact on the Company's business operations, financial status and shareholders' interest.
(6) Whether collateral must be obtained and appraisal of the value thereof.
(7) The records of the credit assessment and risk evaluation regarding the endorsement/guarantee, as a reference.
III. The Finance Department shall establish a log book for its endorsement/guarantee activities and record in detail the following information for the record: the entity for which the endorsement/guarantee is made, the amount, the date of passage by the Board of Directors, or the date of authorization by the Chairman of the Board, the date the endorsement/guarantee is made, and the matters to be carefully evaluated in the preceding paragraph.

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IV. The Finance Department of the Company shall evaluate or record the contingent loss for endorsements/guarantees and shall adequately disclose information on endorsements/guarantees in its financial reports. It shall provide related information to the certified public accountants for implementation of necessary audit procedures and submission of a suitable audit report.
V. If, as a result of a change in circumstances, an entity for which an endorsement/guarantee is made does not meet the requirements of these Rules endorsement/guarantee amount exceeds the limit, the endorsement/guarantee amount or the portion that exceeds the limit for such entity shall be completely terminated upon the expiry of the contract or within a specific deadline based on the rectification plan formulated by the Company. The related rectification plans shall be delivered to all Supervisors and Independent Directors and reported to the Board of Directors. The Company shall complete the rectification according to the timeframe set out in the plan.

Article 7 Discharge of guarantees and endorsements

I. Where related certificates or bills must be discharged due to the repayment or extension of a debt, the recipient of endorsement/guarantee shall issue a formal letter and deliver the certificates to the Finance Department of the Company which shall apply the "discharged" seal and return the certificates. The application letter shall be retained for record.
II. The Finance Department shall register the discharge of endorsements and guarantees into the endorsement/guarantee log book to reduce the endorsement/guarantee amount.

Article 8 Internal control

I. The Company's endorsements/guarantees to others shall be processed in accordance with the procedures herein. In the event when a material violation is found, related personnel shall be penalized commensurate with the violation.
II. If the recipient of the endorsement/guarantee is a subsidiary whose net worth is lower than half of its paid-in capital, the Company shall specify and establish subsequent related management and control measures.
III. In the case of a subsidiary with shares having no par value or a par value other than NT$10, the paid-in capital shall be calculated, in accordance with Article 8.2, as the sum of the share capital plus capital surplus – additional paid-in capital.

Article 9 Internal audit

The Company's internal auditors shall audit the procedures for making of endorsements/guarantees and the implementation at least once every quarter and prepare written records accordingly. They shall promptly notify the Supervisors and Independent

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Directors in writing of any material violation found.

Article 10 Specimen chop custody and usage procedures

I. The Company shall use the corporate chop registered with the Ministry of Economic Affairs as the dedicated chop for endorsements/guarantees. The chop and guarantee bills shall be kept in the custody of a designated person and they shall be used to seal or issue negotiable instruments only in prescribed procedures. The approval of the Board of Directors shall be required for the appointment, dismissal, or replacement of the person responsible for the custody of the chop.
II. When making a guarantee for a foreign company, guarantee agreement issued by the Company shall be signed by an individual with authorization from the Board of Directors.

Article 11 Public announcement and regulatory filing procedures

I. The Company shall publicly announce and file the previous month's balance of endorsements/guarantees of the Company and its subsidiaries before the 10th day of each month. Where the balance of endorsements/guarantees reach one of the following levels, the Company shall announce and report such event within two days commencing immediately from the date of occurrence:
(1) The balance of the Company’s and its subsidiary companies’ endorsements/guarantees reaches 50% or more of the Company’s net worth as stated in its latest financial statements.
(2) The balance of the Company’s and its subsidiary companies’ endorsements/guarantees to any single company reaches 20% or more of the Company’s net worth as stated in its latest financial statements.
(3) The balance of the Company’s and its subsidiaries' endorsements /guarantees to any single company reaches NT$10 million and the carrying amount of investments recognized under the equity method and the total balance of loans reach 30% or more of the Company's net worth as specified in the latest financial statements.
(4) The amount of new endorsements/guarantees made by the Company and its subsidiary companies reaches NT$30 million or more and 5% or more of the Company’s net worth as stated in its latest financial statements.
II. The Company shall announce and report on behalf of any subsidiary thereof that is not a public company of the Republic of China any matters that such subsidiary is required to announce and report pursuant to the preceding paragraph.

Article 12 Other items

I. The Company shall evaluate or record contingent loss for endorsements/guarantees and shall adequately disclose information on endorsements/guarantees in its financial

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reports. It shall provide related information to the certified public accountants for implementation of necessary audit procedures.

II. Any matters that are not addressed herein shall be governed by relevant laws and the Company's related regulations.

Article 13 Enforcement and amendment

The Regulations shall first be passed by the Board of Directors and delivered to all Supervisors before it is submitted to the shareholders' meeting for consent. If a Director expresses an objection and records or written statements are available, the Company shall submit information regarding the Director's objection to Supervisors and to the shareholders' meeting for discussion. The same shall apply to any revision.

The opinions of Independent Directors shall be taken into full consideration in discussions in the Board of Directors meeting on the Regulations in accordance with the preceding paragraph. If any Independent Director expresses dissenting opinions or qualified opinions, they shall be noted in the minutes of the Board of Directors meeting.

Article 14 Control and management procedures for endorsements/guarantees made

by subsidiary companies
I. Where a subsidiary of the Company intends to provide endorsements/guarantees to other entities, the Company shall order the subsidiary to establish the Rules for Making of Endorsements/Guarantees in accordance with the "Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies" and process endorsements/guarantees in accordance with the operating procedures specified therein.
II. When a subsidiary provides endorsements/guarantees to other entities, it shall provide related information to the parent company and consider the opinions of the parent company's related personnel before processing the endorsement/guarantee procedures.
III. The subsidiary shall regularly report the follow-up status of endorsements/guarantees to the parent company.
IV. Where a subsidiary in which the Company holds, directly or indirectly, more than 90% of the voting shares provides endorsements/guarantees in accordance with Article 3, Paragraph 2, it shall submit the proposal to the Company's Board of Directors for approval before implementation, provided that this restriction shall not apply to endorsements/guarantees made between companies in which the Company holds, directly or indirectly, 100% of the voting shares.

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Appendix VI

Largan Precision Co., Ltd.

Rules and Procedures of Shareholders' Meeting

Article 1: Unless otherwise provided for in applicable laws or regulation, shareholders' meetings of this Company (hereinafter referred to as the Company) shall be conducted in accordance with these Rules and Procedures.
Article 2: The Company shall provide attending shareholders with an attendance book to sign in, or attending shareholders may submit attendance cards in lieu of signing in. The number of attending shares shall be calculated according to the attendance book and the attendance cards submitted plus the number of shares exercised by correspondence or electronic means.
Article 3: Attendance and voting rights at shareholders’ meetings shall be calculated based on the numbers of shares represented.
Article 4: The venue of shareholders’ meetings shall be on the Company’s premises or at another place convenient for shareholders to attend and suitable for such a meeting. The meeting shall begin no earlier than 9 a.m. and no later than 3 p.m.
Article 5: If a shareholders' meeting is convened by the Board of Directors, the Chairman of the Board of Directors shall be the chairman presiding at the meeting. If the Chairman of the Board of Directors is on leave or unable to perform his duties for any other reason, the Vice Chairman shall preside at the meeting on the Chairman's behalf. If the Vice Chairman is also on leave or unable to perform his duties for any other reason, the Chairman of the Board of Directors shall appoint a Managing Director to act on his behalf. If there are no Managing Directors, the Chairman shall appoint a Director to act on his behalf. If the Chairman does not make such a designation, the Managing Directors or Directors shall select one person from among themselves to serve as chair.

If the shareholders' meeting is convened by any other person entitled to convene the meeting other than the Board of Directors, such person shall be the chair of the meeting.

Article 6: The Company may appoint designated counsel, certified public accountants or other relevant persons to attend the shareholders' meeting.

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Staff handling administrative affairs of a shareholders' meeting shall wear identification badges or armbands.

Article 7: The Company's shareholders’ meetings must be videotaped or audio recorded and kept for at least one year.

Article 8: The chair shall call the meeting to order at the appointed time. However, if the attending shareholders do not represent more than one-half of the total number of issued shares, the chair may postpone the meeting time. No more than two such postponements, for a combined total of no more than one hour shall be made. If after two postponements the attending shareholders still represent less than one-half of the total number of issued shares but represent more than one-third of the total issued shares, provisional resolutions may be adopted in accordance with Article 175, Paragraph 1 of the Company Act.

If during the process of the meeting the number of issued shares represented by the shareholders present becomes sufficient to constitute the quorum, the chair may submit the provisional resolutions to the meeting for approval in accordance with Article 174 of the Company Act.

Article 9: The agenda of the shareholders’ meeting shall be set by the Board of Directors if the meeting is convened by the Board of Directors. The meeting shall proceed in accordance with the agenda unless otherwise resolved at the meeting.

The provisions of the preceding paragraph apply mutatis mutandis to a shareholders’ meeting that is convened by any person other than the Board of Directors entitled to convene a meeting.

Unless otherwise resolved at the meeting, the chair cannot announce adjournment of the meeting before all the items (including extemporary motions) listed in the agenda are resolved.

The shareholders cannot designate any other person as chair and continue the meeting in the same or another place after the meeting is adjourned.

Article 10: When a shareholder presents at the meeting wishes to speak, a speaker’s slip shall be filled out with summary of the speech, the shareholder's number (or the number on their attendance card) and the name of the shareholder. The sequence of speeches by shareholders shall be decided by the chair.

If a shareholder present at the meeting submits a speaker’s slip but does not speak, the

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shareholder shall be deemed to have not spoken.

In case the contents of the speech of a shareholder are inconsistent with the contents of the speaker’s slip, the spoken content shall prevail.

Unless otherwise permitted by the chair and the speaking shareholder, no shareholder shall interrupt the speech of other shareholders, otherwise the chair shall stop such interruption.

Article 11: Unless otherwise permitted by the chair, each shareholder shall not speak more than twice on the same discussion item and each speech may not exceed five minutes. If a shareholder violates the rules outlined in the preceding paragraph or exceeds the scope of the discussion item, the chair may stop the shareholder’s speech.
Article 12: Any legal entity designated as proxy by a shareholder to be present at the meeting may appoint only one representative to attend the meeting.
If a legal entity is a shareholder and designates two or more representatives to attend the meeting, only one representative can speak for each discussion item.
Article 13: After the speech of a shareholder, the chair may respond in person or designate another person to respond.
Article 14: The chair may announce to end the discussion of any resolution and call for a vote if the chair deems it appropriate.
Article 15: The chair shall appoint persons responsible for monitoring and counting ballots e However, the persons responsible for monitoring ballots must be shareholders. The result of voting shall be announced on-site at the meeting and placed on record.
Article 16: During the meeting, the chair may, at his discretion, set time for intermission.
Article 17: A resolution shall be adopted by a majority of the votes represented by the shareholders present at the meeting. At the time of a vote, the chair or a person designated by the chair shall first announce the total number of voting rights represented by the attending shareholders for each proposal, followed by a poll of the shareholders. On the same day after the meeting, the results of each proposal, based on the numbers of votes for and against and the number of abstentions, shall be entered into the Market Observation Post System.
All shareholders are entitled to one vote for every share held, except for the circumstances stipulated in Article 179 of the Company Act where shares are not assigned voting rights. When one person is concurrently appointed as proxy by two or

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more shareholders, the voting rights represented by that proxy may not exceed 3% of the voting rights represented by the total number of issued shares. Any excess of that percentage shall not be included in the calculation.

Article 18: 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 sequence of voting. If any one of them has been adopted, the other proposals will then be deemed vetoed, and no further voting shall be required.
Article 19: The chair may instruct disciplinary officers (or security personnel) to help maintain order at the meeting place. Such disciplinary officers or security personnel shall wear arm bands which identify their roles as "Disciplinary Officer."
Article 20: These Rules and Procedures shall be implemented following approval by a shareholders' meeting. The same applies in the case of amendments.

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Appendix VII

Largan Precision Co., Ltd.

Procedures for Election of Directors

Article 1: The election of Company's Directors shall be conducted in accordance with these Procedures.
Article 2: The Company’s Directors shall be elected by a cumulative voting method. Each share will have voting rights in number equal to the Directors to be elected, and may be cast for a single candidate or split among multiple candidates.
Article 3: The number of Directors will be as specified in the Company's Articles of Incorporation, with voting rights separately calculated for Independent and non-Independent Director positions. Candidates receiving ballots representing the highest number of voting rights shall be elected sequentially according to their respective numbers of votes. When two or more persons receive the same number of votes, thus exceeding the specified number of positions, lots shall be drawn to decide who is elected. The chair shall draw lots on behalf of any person absent.
Article 4: Ballots shall be prepared and issued by persons entitled to convene the meeting and numbered based on the shareholder's account number or the attendance card number with the number of votes specified. Attendance card numbers may be printed on the ballot instead of using the names of voting shareholders.
Article 5: Before the election begins, the chair shall appoint persons responsible for monitoring and counting ballots to perform their respective duties. The ballot boxes shall be prepared by the Company and inspected in public by the ballot monitoring personnel before voting commences.
Article 6: The election of the Company's Directors shall be conducted in accordance with the candidate nomination system and procedures set out in Article 192-1 of the Company Act.
Article 7: The voter must specify the name of the candidate in the "candidate" field of the ballot. Article 8: A ballot is invalid under any of the following circumstances: 1. A ballot not prepared by the persons entitled to convene the meeting. 2. A blank ballot placed in the ballot box. 3. The writing unclear and illegible or altered.
Candidate entered in the ballot does not match the list of Director candidates.
Other words or markings entered in addition to the candidate's number of voting rights allotted.
The sum of voting rights cast by a voter exceeds the sum of voting rights held by the voter.

Article 9: The ballots shall be viewed and counted onsite after completion of voting and appointed personnel shall monitor the ballots. The results of the vote shall be announced by the chair onsite.

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Article 10: The Company shall issue notifications to the persons elected as Directors after the shareholders' meeting.

Article 11: Matters not provided herein shall be governed by the Company Act and other applicable laws and regulations.

Article 12: These Procedures shall be implemented following approval by a shareholders’ meeting. The same applies in the case of amendments.

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Appendix VIII

Largan Precision Co., Ltd.

Shareholding of Directors and Supervisors

			Book closure date: April 10,2022	Book closure date: April 10,2022	Book closure date: April 10,2022	Book closure date: April 10,2022
Position	Name	Date elected	Shares held at the time of election		Shareholding as recorded in the shareholder register on the book closure date
			Number of shares held	Percentage of shares held(%)	Number of shares held	Percentage of shares held(%)
Chairman Vice- Chairman Director	Mao Yu Commemorate Co., Ltd. Representatives: En-Chou Lin En-Ping Lin Yao-YingLin	2019.06.12	8,672,968	6.47%	18,910,616	14.10%
Director	Shih-ChingChen	2019.06.12	6,756,831	5.04%	6,756,831	5.04%
Director	Ming-Yuan Hsieh	2019.06.12	3,606,585	2.69%	3,606,585	2.69%
Independent Director	Ming-Hua Peng	2019.06.12	56,604	0.04%	56,604	0.04%
Independent Director	Shan-Chieh Yen	2019.06.12	No shares held	0%	No shares held	0%
Supervisor	Chung-Jen Liang	2019.06.12	2,091,721	1.56%	2,091,721	1.56%
Supervisor	Tsui-Ying Chiang	2019.06.12	6,625,569	4.94%	6,625,569	4.94%
Number andpercentage of shares held byall Directors					29,330,636	21.87%
Number andpercentage of shares held byall Supervisors					8,717,290	6.50%

The Company's total issued common shares: 134,140,197 shares
The Company has appointed two Independent Directors. According to Article 26 of the "Rules and Review Procedures for Director and Supervisor Share Ownership Ratios at Public Companies", if a public company has elected two or more Independent Directors, the share ownership standards for all Directors and Supervisors other than the Independent Directors shall be decreased by 20%.
The number of shares held by all Directors and Supervisors of the Company meet the legal percentage requirements.

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Thank You

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AI assistant

LARGAN — AGM Information 2022

52244_rns_2022-06-22_ee105f77-f644-4718-ac3b-dd9623056462.pdf

Largan Precision Co., Ltd

2022 Annual General Shareholders’ Meeting

Meeting Agenda Handbook

----Disclaimer----

Table of Contents

Largan Precision Co., Ltd. 2022 Annual General Shareholders' Meeting Procedures

Largan Precision Co., Ltd. 2022 Annual General Shareholders' Meeting Agenda

Report Items

Proposals

Discussions and Elections

Extemporary Motions

Meeting Adjourned

Largan Precision Co., Ltd.

2021 Business Report

Independent Auditors’ Report

To the Board of Directors of Largan Precision Co., Ltd.:

Opinion

Basis for Opinion

Key Audit Matters

Inventory valuation

Description of key audit matter:

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

Auditor’s Responsibilities for the Audit of the Parent Company Only Financial Statements

KPMG

Notes to Readers

(English Translation of Parent Company Only Financial Statements and Report Originally Issued in Chinese) LARGAN PRECISION CO., LTD.

Statements of Comprehensive Income

For the years ended December 31, 2021 and 2020

(English Translation of Parent Company Only Financial Statements and Report Originally Issued in Chinese) LARGAN PRECISION CO., LTD.

Statements of Cash Flows

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

Independent Auditors’ Report

Opinion

Basis for Opinion

Key Audit Matters

Inventory valuation

Description of key audit matter:

How the matter was addressed in our audit:

Other Matter

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

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

KPMG

Notes to Readers

(English Translation of Consolidated Financial Statements and Report Originally Issued in Chinese) LARGAN PRECISION CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

For the years ended December 31, 2021 and 2020

(English Translation of Consolidated Financial Statements and Report Originally Issued in Chinese) LARGAN PRECISION CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

Largan Precision Co., Ltd. 2021 Earnings Distribution Table

Largan Precision Co., Ltd. Comparison Table of Revisions to the "Procedures for the Acquisition or Disposal of Assets"

Largan Precision Co., Ltd. Comparison Table of Revisions to the "Procedures for Engaging in Derivatives Trading"

Largan Precision Co., Ltd. Comparison Table of Revisions to the "Rules for Loaning of Funds"

Largan Precision Co., Ltd. Comparison Table of Revisions to the "Rules for Endorsements/Guarantees"

Appendix

Appendix I(Before Revision)

Largan Precision Co., Ltd. Articles of Incorporation

Chapter 1 General Provisions

Chapter 3 Shareholders’ Meeting

Chapter 4 Directors and Supervisors

Chapter 7 Supplemental Provisions

Largan Precision Co., Ltd.

Chapter 1 General Provisions

Article 1 Purpose

Article 2 Basis

Article 4 Investment amount

Article 5 Terms used in the Procedures are defined as follows:

Article 7 Operating procedures

Article 9 Appraisal report

Chapter 7 Supplemental Provisions

Largan Precision Co., Ltd.

Article 1 Purpose and basis

Article 4 Hedging strategy

Article 6 Performance evaluation guidelines

Article 7 Total contract value

LARGAN AGM Information 2022