LONG BON - AGM Information 2021 | FinancialReports.eu

TWSE:2514

Long Bon International CO., LTD.

2021 ANNUAL SHAREHOLDERS’ MEETING

MEETING AGENDA

Time : 9:00 AM,JUNE 30,2021

Place : 10F,No.50,Sec.1,Zhongxiao W. Rd., Zhongzheng Dist., Taipei City

Meeting Agenda

I. Announcing Meeting in Session .................................................................. 2 II. Welcome Speech by the Chairman ............................................................. 2 III. Reported Matters ....................................................................................... 2 IV. Acknowledged Matters ............................................................................. 3 V. Matters for Discussion ................................................................................ 5 VI. Extraordinary Motions .............................................................................. 6 VII. Adjournment ............................................................................................ 6

Attachments

2020 Business Report .................................................................................. 7 2. 2020 Audit Committee Review Report ..................................................... 13 3. 2020 Consolidated and Parent-Company Only Financial Statements ...... 14 4. Comparison Table for Amendments to Regulations for Loan of Funds to Others ..... 35

Appendix

Articles of Incorporation ........................................................................... 37 2. Operational Procedure for Loan of Funds to Others (Before Amendment) .............. 43 3. Rules of Procedure for Shareholders’ Meeting ......................................... 50 4. Shareholding by All Directors ................................................................... 54

Long Bon International Co., Ltd.

2021 General Shareholders’ Meeting Agenda

Time: June 30, 2021 (Wednesday) at 9:00AM

Location: 10F, No. 50, Sec. 1, Zhongxiao W. Rd, Zhongzheng Dist., Taipei City

(10F Meeting Room at Asia Plaza Building)
I. Announcing Meeting in Session (w/ number of shares represented by the attending shareholders reported ）
II. Welcome Speech by the Chairman
III. Reported Matters

Case 1: 2020 Business Report.

Case 2: Audit Committee Review on Final Accounts of 2020.

Case 3: 2020 Distribution of Employees’ and Directors’ Compensations.

IV. Acknowledged Matters

Case 1: 2020 Business Report and Financial Statements.

Case 2: 2020 Earnings Distribution.

V. Matters for Discussion

Case 1: To Amend “Operational Procedure for Loan of Funds to Others”.

VI. Extraordinary Motions

VII. Adjournment

I. Announcing Meeting in Session

II. Welcome Speech by the Chairman

III. Reported Matters

Case 1

。 Proposal: 2020 Business Report

Explanation: Please refer to Pages 7 to 12 herein for 2020 Business Report.

Case 2

。 Proposal: Audit Committee Review on Final Accounts of 2020

Explanation: Please refer to Page 13 herein for Audit Committee Review Report.

Case 3

Proposal: 2020 Distribution of Employees’ and Directors and Supervisors’ Compensations.

Explanation:

The Company’s profit before tax in 2020 after deduction of directors’ and employees’ compensations is NTD (same below) 1,172,466,883, and, in accordance with Article 31 of the Company’s Articles of Incorporation, 3.5% of such profit at NTD 41,036,341 will be set aside as directors’ compensation, and 1% of such profit at NTD 11,724,669 will be set aside as employees’ compensation. Both compensations will be distributed in cash.
Parties entitled to employees’ compensation will be limited to full-time employees of the Company. The distribution will be determined in its amounts and conducted by the Chairman under full authorization on basis of seniority, rank, work performance, overall contribution, etc.

IV. Acknowledged Matters

Case 1 Proposed by the Board of Director

Proposal: 2020 Business Report and Financial Statements. For your approval. Explanation:

The Company’s 2020 Business Report and Financial Statements (Consolidated and Parent-Company Only Financial Statements) have been audited and attested by CPAs Chang, Shu-Ying and Wu, Mei-Ping of KPMG Taiwan, and submitted along with Business Report to the Audit Committee for review.
The statements stated below are attached for your reference:
(1) Business Report (Please refer to Pages 7 to 12 herein).
(2)Consolidated Financial Statement (Please refer to Pages 14 to 24 herein).
(3)Parent-Company Only Financial Statement (Please refer to Pages 25 to 34 herein).

Resolution:

Case 2 Proposed by the Board of Director

Proposal: 2020 Earnings Distribution. For your review. Explanation:

The Company’s earnings distribution is proposed as follows.

Long Bon International Co., Ltd. Earning Distribution Table for the year 2020

Unit: NTD

Items Amount Undistributed Earnings from the Preceding Year 4,327,830,399 Add: After-Tax Profit of the Year 1,100,637,090 Less: Disposal of Equity Instruments Measured at (15,000,000) Fair Value through Other Comprehensive Gains/Losses Difference between Acquisition Price and (66,236,748) Book Value of subsidiaries’ stock rights Cancellation of Treasury Shares (29,390,541) Other Comprehensive Gains or Losses of the (41,748) Period Legal Reserve (98,996,805) Special Reserve (182,577,483) Distributable Earnings 5,036,224,164 Retained Earnings of the Year 5,036,224,164 Chairman: Managerial Officer: Accounting Manager: Liu, Wei-Long Liu, Wei-Long Li, Shu-Hui

As the Company is currently in phase of business expansion, it is proposed that no dividend will be distributed this year in consideration of the Group’s needs in operation funds.

Resolution:

V. Matters for Discussion

Case 1 Proposed by the Board of Director

Proposal: To “Operational Procedure for Loan of Funds to Others”. For your adoption.

Explanation:

In accordance with Question 39 (2) of the “Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies”
As per Article 3, paragraph 2 of the Regulations, in case of engagement in loan of funds, upon maturity of the 1-year period for the short-term financing facilities to others, such repayment shall not be done with unrightful payment flows, or, be deferred by extending the period of repayment as agreed by the Board of Directors of the Company; a violation against Article 3 of the Regulations may occur in case of such extension.
The Company with violation against Article 3 of the Regulations will be subject to penalties at NTD 240,000 to its responsible person in accordance with Articles 178 and 179 of the Securities and Exchange Act, followed by rectification of such violation by the Company within 1 month.
Amendments and deletions on zero date and interest rate limitations in Article 5 and dispositions upon maturity in Article 7 of the Operational Procedure for Loan of Funds to Others are proposed.
Please refer to Pages 35-36 herein for the comparison table for amendment.
It is proposed for your review.

Resolution:

VI. Extraordinary Motions:

VII. Adjournment

Business Report Attachment 1

1. 2020 Business Results

(1) Results of Operating Implementations

Albeit under the impact of COVID-19 in 2020, the Taiwanese housing market showed its strength in combatting the influences by such pandemic under the sufficient funds and lower interest rates. The Company sustains its great spirit of perseverance and continues in enhancing operating profits as well as taking the lead in stabilizing its foundation in the real estate investments, gradually acquiring lands for urban unsafe and old buildings in Wanhua and Xinyi Districts and contributing funds for integration of the updated urban pattern; meanwhile, with full effort in maximizing profits for the shareholders, we have made the urban renewal project on Xiyuan Rd. reaching an integration rate near 96%, while the building permit for Neihu land project has been acquired and is under intense planning on construction commencement matters, and the Huanhe S. Rd. project has obtained approval for reconstructions of unsafe and old buildings, thrusted filing for application of building permit by the end of the year; in addition, the Company has in recent years gradually expanded its reach in different business scopes via re-investments from the current construction business to core businesses engaging fields of construction, funeral service and professional investments, making a diversified development by gradually transforming into an industrial holding company at a stable pace. With the greatest endeavor of all colleagues, we cohere with the original intentions, continuously moving toward the management goal with firm growth in both revenue source and profitability.

(2) 2020 Financial Income and Profitability Analysis

In 2020, the Company has attained a consolidated operating income at NTD 10,776,324 thousand, up approx. 15.93% compared to that of 2019 at NTD 9,295,613 thousand; in terms of profitability, the profit attributable to the parent company is NTD 1,100,637 thousand, along with EPS after tax at NTD 3.05 and RoE at 28.59%.

2. Overview for 2021 Business Plans

Prospecting the year 2021, although the COVID-19 pandemic is under control in Taiwan, owing to continued outbreak of pandemic overseas without an ease combined with chaos in circumstances after US Presidential elections as well as escalated Sino-US Trade War, along with circumstances containing sustained low rate in short-term financing and easing of capital, real estate remains one of the main investment methods adopted by corporate capitals for hedging; however, in consideration of the ongoing rise of pandemic, tardy pace for opening of global economy and concerns of housing market by competent authorities, the housing market in 2021 remains in high degree of uncertainty and shall have prudence over all engagements.

The domestic office buildings market is expected to gain a ongoing and gentle growth, and, in terms of industrial plants, the product in greatest shortage on the market in recent years is the plants, especially the plants or industrial lands at a fair price, which may be utilized as a thrust for the Company in promoting the plant office in Neihu, as a majority of construction companies have gradually taken their comeback in the plant office market. The Company will, in combination with government policies, make investments and assessments over urban renewal and reconstruction of unsafe and old building projects with premium locations, adjacency to MRT stations or major constructions and high level of integration which are situated in north to Taichung, with development categories mainly in residences, plant offices and office buildings, while incorporating the business

opportunities in senior citizen demographics and extending the reach of management sectors to the concept of diversified management including construction, funeral services, Yin Zhai (residences with occurrence of non-natural deaths) development, senior citizen residences and recreation industry, etc., and integrate group resources for creation of a multi-win situation, furthermore going toward the management goal of stable growth in revenue and profits.

(1) 2021 Management Guidelines

The Company’s 2021 operation plans concerning business sectors including real estate rental and sales development and management and investment in real estate development the asset office, stock exchange market investment and re-investment management by finance office, Reiju Construction, Lobo Enterprise Life Services, Baohui Development (Donghua Golf Course), Longhui Development (Beihai Golf Course and funeral and interment lands), etc., are described as follows:

1. Business of Asset Office

(1) Property Sale Plans

It is expected that the Company will draft plans to rejuvenate the Company’s existing realties, with continued sale of remnant houses and parking spaces situated in Taichung and newly completed project of Changan Juan situated in Taipei, generating an expected annual revenue through sales at NTD 192,573 Thousand.

(2) Rental Plans

In 2021, rent revenue is expected to be heightened by the addition of rentals of office on Minquan E. Rd., façade advertisements at Huanhe S. Rd. project, Donghua Golf Course, etc. With other properties in full occupancy into consideration, the annual rent revenue is expected at NTD 80,275 Thousand, with forecasts of rent revenue distribution as shown in the following table:

Table for 2021 Rent Revenue Forecasts by Properties

Unit: NTD Thousands


Asset Details	Annual Total

TWTC International Trade Building	5,995
Dengfeng 21	6,337
Project at Ruihu St., Neihu	1,514
Daya Parking Spaces	3,075
Minquan E. Rd. Project	5,210
Xiyuan Rd. Project	840
Donghua Golf Course	57,154
Others (Park Lane, Advertisement of Huanhe S. Rd., etc.)	150
Total	80,275

(3) Domestic Real Estate Investment Plans
a. In response to needs orientations by the future real estate markets, it is expected that the Company will acquire land and realty in redevelopment areas, with adjacency to material transportation and construction projects or in areas with complete livelihood mechanisms within Taiwanese urban regions through investment, purchase or tender for development and construction of houses for sales.
b. In addition to purchase of lands for project constructions corresponding to self-construction purposes, concerning the cases in essential regions north to Central Taiwan including Taipei City, New Taipei City and Taichung City, the Company may make case-by-case investments or engage in expediting reconstruction of unsafe and old houses through investment or joint construction to obtain investment efficacy.
c. In response to diversified management in the future, the Company combines group resources and has planned to engage in recreation industry circle golf course operation, and intends to engage in Ying Zhai real estate investment or development market by seeking Ying Zhai areas or targets around the nation as well as conducting planning, development or integration.
(4) Investment Plans for Existing Real Estate
a. Urban Renewal of Xiyuan Rd., Wanhua Dist. Taipei City: The estimated total development schedule for this project is approx. 6.5 years, which involves operation matters for urban renewal business and contingency plans, as well as integrated execution matters on owners of properties within urban renewal scope.
b. Taichung Dakeng Project: In addition to effective control over the current condition of properties, the Company also cooperates with public sector in conducting the overall review and revision procedure for Specific District of Taiching Dakeng Scenic Area, while actively participating in communications upon amendments to relevant laws and regulations as well as review meetings, along with concurrent conduct of predecessor activities prior to obtaining of development permit and planning toward short-term activation strategies.
c. Urban Renewal Project in Chengde Rd., Datong Dist., Taipei City: the urban renewal plans for this project has been approved, and the Company will continue in conducting applications for subsequent demolition license and building permit following signings of joint-construction contracts, and will consider the pre-sale case by case in cooperation with the implementer when appropriate.
d. Taipei Neihu Land Project: the building permit has been acquired for this Project, and the Company will conduct relevant declarations on construction start procedures within the validity of building permit, and concurrently contact plant offices for potential investors.
e. Project of Reconstruction of Unsafe and Old Buildings at Huanhe S. Rd., Wanhua Dist., Taipei City: the letter of approval for the plan of reconstruction of unsafe and old buildings has been obtained, and the Company will subsequently apply for building permits within statutory period and declare the commencement of construction.
f. Pre-Sale of Taipei Changan Juan Project: The Company makes regular tracking over construction progress and review reports of building management companies, furthermore conducting sales after project completion.

(2) Sales Forecast and Basis

With reference to growth of various businesses and expansion of market scale, the revenue forecasts for various businesses in 2021 are as follows:

Rental, sales and development of Asser Office: it is estimated that the total sales revenue from real estate will be NTD 192,573 thousand; the estimated total rent revenue from rental of real estate is NTD 80,275 thousand. The aggregate of the forecasted annual revenue from the preceding two projects is totaled at NTD 272,848 thousand.
(3) Important Production and Promotion Policies
Business of Asset Office

(1) Real Estate Rent and Sale Business

a. Make posts of properties intended for rental or sales utilizing the specialized websites for real estate rental and sales e.g. “591” rental website or bulletin boards at communities, with timely update and managements to increase exposure for inquiries and opportunities in rental or sales.
b. Facilitating deals of realties through referral by floor management personnel of projects and local realty agencies, or raising commission percentage of rentals.
(2) Domestic Real Estate Investments
a. The Company will obtain land projects or buildings for development or operation through proactive development, purchase by referencing information by realtors and landlords, or joint or case investments, as well as public tenders by governmental organs or other institutions.
b. Utilizing the niche as a public company, the Company obtains opportunities for land purchase, cooperation and joint construction through information or targets proactively provided by landlords, seeking real estate investments and profiting.
c. Combining the Group’s professional integration and management capabilities, the Company will make dual progression in Yang Zhai and Ying Zhai real estate markets, exerting the synergy of development or integration.

3. Future Company Development Strategies

The Company will center at businesses of real estate development and rental and sales managements for relevant properties, and engages in investment and finance, construction, Ying Zhai real estate businesses and operation of golf courses through re-investments; in the future, the Company will, through the development of aforesaid businesses, enable the future operation of the Company to attain the sustainable management goal with growth, stability and profiting; the development plans for related businesses are itemized as follows:

(1) Development of Real Estate Business
Conducting integration and coordination of lands within the scope of peripheral statutory scale and scope, attaining the efficacy of developing urban renewal land units or scope of unsafe and old buildings.
Investing in purchase or tendering of land and realty in redevelopment areas or in area with complete livelihood mechanism situated in Urban regions in Taiwan for use of developing and building houses for sale is expected.
Feasibility in promotion of investing in joint construction of projects in Greater Taipei.

Investing in urban renewal and reconstruction of unsafe and old buildings in focal and essential areas in Taipei City along with the obtaining of complete investment blocks integrated through the exerting of professional consultants to exert a high productivity and profits for urban renewal.
In response to diversified management in the future, the Company combines group resources and has planned to engage in recreation industry and golf course operation, and intends to engage in Ying Zhai real estate investment or development market by seeking Ying Zhai areas or targets around the nation as well as conducting planning, development or integration.
Assessing feasibilities of tender cases by public sectors and tendering to make successful obtaining of real estate for project promotion, generating operating revenue for the Group.

IV. Impacts and Countermeasures under Macroeconomy, Policies and Regulations, and Market Supply and Demand Circumstances

(1) Macroeconomy

Although Taiwan's overall economy was ravaged by COVID-19 in 2020, under effects of abundant funds and policy imposing low interest rates, the country demonstrated strong capabilities against the pandemic, netting an economic growth rate at 1.56% and CPI rate at -0.19%. Taiwan’s housing market is relatively stable internationally, with decent performance in terms of prices and capacity. As economies around the globe continue to lower their economic indicators and their unemployment rates continue to grow, it is evident that the global economy and prosperity will take longer to recover; on the contrary, owing to the booming demand of the technology manufacturing industry in response as the world enters into the 5G era, Taiwan’s ginormous semiconductor industry is inevitably benefitted directly, hence, numerous professional research institutions have made unanimous predictions that Taiwan’s economic growth rate in 2021 is expected to surpass 3%.

In addition, as the US-Sino Trade conflict escalates, causing the profound influences to global economic industry chain, many Taiwanese business owners have gradually returned to Taiwan, furthermore resulting in a significant increase in the volume of industrial land and commercial real estate transactions, becoming the main driving force in the housing market in H2 2020, and real estate prices have begun to rebound slowly.

(2) Policies and Regulations

In recent years, the government has endeavored to promote a sound housing market policy, including the formulation and amendment to policies on the reconstruction of the unsafe and old buildings and related laws and regulations. Through separate acts for expediting the renewal of old and unsafe buildings and the urban renewal process, establishment of a dedicated agency " National Housing and Urban Regeneration Center (HURC)" and the inauguration of the Financial Union Urban Renewal Service Center officially, the country has officially initiated the Urban Renewal 2.0 for facilitation of policy execution efficacies. The projects of reconstruction of unsafe and old houses and urban renewal have doubled year by year at an average of 40 projects per year, and reached a staggering number at 956 projects between January and August in 2020. The Company has proposed the three principles of "Easy Integration, Clear Rewards, and Accelerated Review" to attain a triple-win for the civilians, practitioners and the industry.

In addition, according to statistics from the Directorate General of Budget, Accounting and Statistics of the Executive Yuan, Taiwan has officially become an aging age society in 2019 and is expected to become a hyper-aging society in 2026. As a result, to solve the potential social issues derived from aging population, the government has launched Long-Term Care 2.0 in 2018 with extended service items, fees subsidized and eligible groups as a countermeasure, while providing project financing to encourage the industry to invest in long-term care funds. In 2019 years, the government took advanced

measures to lower the threshold of return on real estate investment in the life insurance industry to 1.095%, allowing the insurance industry to contribute to senior citizen residences and daycare of aged population beyond the scope of Institutional Long-Term Care Juridical Entities Act.

(3) Supply and Demand of Real Estate Market

Albeit the global economy has been hit by the COVID-19 pandemic, due to relatively successful pandemic prevention, and favorable factors of low-profit circumstances, domestic banks muscling for mortgage business opportunities as well as continued transfer of funds to the housing market, Taiwanese housing market, except for the sluggish transactions from January to July in 2020 due to the horrors over pandemic and the customs refraining from walk-through of houses in the Ghost Month, recorded an ongoing growth compared to 2019 in total sales and ownership transfers of houses in the Six Municipalities of Taiwan, and the total house ownership transfers of the entire year is expected to surpass the 300,000 houses recorded in the previous year, heading for the record-high transaction volume in the recent six years.

In terms of industrial land, plant offices, and commercial real estate markets, due to the intensification of the Sino-US Trade War and the return of Taiwanese business owners, construction companies or enterprises contribute to the significant growth in transaction volumes for their ongoing purchases of lands, plant offices and commercial real estate. In Q3 2020, a majority of the land transactions made are in Taichung and New Taipei City, with a total transaction value of US$31.4 billion, while a record-breaking US$68.4 billion in transaction volume has been achieved in commercial real estate dealings. The current price for office realties in Taipei is marked at an average of NTD 852 thousand per Ping, with a rent capitalization rate at 2.54%. Construction and life insurance companies remain the contending for lands with raised stakes, and numerous developers also involved in the craze for office building and plant office houses, which nearly 20 office buildings are expected to be completed in construction within the next seven years. The average price for Neihu Technology Park market falls at NTD 527 thousand per Ping, yielding a rent capitalization rate at 2.71%. Faced with scarce supply in office buildings and sustained backflow of production forces of advanced technology companies, as well as severe shortage in high-end office buildings at downtown, Neihu Technology Park and Nankang will become the popular destinations for relocating enterprises.

(4) Conclusion and Countermeasures

Even if the COVID-19 is under effective control in Taiwan, due to the ongoing outbreak of pandemic in other countries with no signs of mitigation accompanied by chaos in circumstances after US Presidential elections as well as escalated Sino-US Trade War, along with circumstances containing sustained low rate in short-term financing and easing of capital, real estate remains one of the main investment methods adopted by corporate capitals for hedging; however, in consideration of the ongoing rise of pandemic, tardy pace for opening of global economy and concerns of housing market by competent authorities, the housing market in 2021 remains in high degree of uncertainty and shall have prudence over all engagements.

Under a comprehensive consideration, the Company will, in combination with government policies, make investments and assessments over urban renewal and reconstruction of unsafe and old building projects with premium locations, adjacency to MRT stations or major constructions and high level of integration which are situated in north to Taichung, with development categories mainly in residences, plant offices and office buildings, while incorporating the business opportunities in senior citizen demographics and extending the reach of management sectors to the concept of diversified management including recreation industry and professional operations of golf courses, Yin Zhai development and senior citizen residences, etc., creating a multi-win situation for the Group.

Chairman: Liu, Wei-Long Managerial Officer: Liu, Wei-Long Accounting Manager: Li, Shu-Hui

Audit Committee Review Report Attachment 2

The Board of Directors has compiled and submitted the Company’s Business Report of 2020, Financial Statements and Proposals for Earnings Distribution; among which contains Financial Reports audited and attested by CPAs Chang, Shu-Ying and We, Mei-Ping of KPMG Taiwan, with financial statements with no qualified opinions issued; the aforesaid Business Report, Financial Statements and Proposals for Earnings Distribution have been reviewed and determined to be correct and accurate by the Audit Committee. In accordance with Article 219 of the Company Act, I hereby submit this report.

2021 Annual General Shareholders’ Meeting of the Company

Long Bon International Co., Ltd.

Convener of

Audit Committee: Ning,Guo-Hui

March 23, 2021

Consolidated Financial Statements For the Year Ended December 31, 2020 Attachment 3

Independent Auditors ’ Report

To the Board of Directors of Long Bon International Co., Ltd.:

Opinion

We have audited the consolidated financial statements of Long Bon International Co., Ltd. and its subsidiaries (“the Group”), which comprise the consolidated balance sheets as of December 31, 2020 and 2019, the consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and 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, 2020 and 2019, 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.

Acquisition, disposal and evaluation of financial assets

Refer to Note 4(g) “Financial instruments”, 6(b) and (c) “ Financial Assets” to the consolidated financial statements for the accounting policy and the details of the information.

Description of the key audit matter

The carrying amounts of "financial assets at fair value through profit or loss" and "financial assets at fair value through other comprehensive income" constitute 23% of total assets of the Group, which is significant for the financial statements as a whole. In addition, the Group’s recognized financial assets were evaluated at fair value. As for equity investment in unlisted companies, the fair value was obtained based on valuation technique or the quotation of the counterparty, and was recognized as "financial assets at fair value through other comprehensive income". Since the valuation result of financial assets involves the financial restriction clause of financial institutions loan agreement for financing, it further impacts working capital management. Therefore, the acquisition, disposal of financial assets and the testing of end-of-period valuation were determined to be a critical matter in our audit of Group’s consolidated financial reports.

How the matter was addressed in our audit

Our main audit procedures for the above key audit matter include testing of the relevant control of acquisition, disposal, valuation, and accounting in the investment cycle; sampling the acquisition and disposal of financial assets, and checking relevant documents; reviewing as well as adjusting the PSI table and general ledger entries; obtaining financial institution confirmation and looking into the TDCC passbook provided by our client; checking the closing market prices of each financial asset on the balance sheet date on the TWSE website, with a view to assess the appropriateness of the amounts recognized at the end of the year. We checked passbooks and bank statements in order to assess the reasonableness of the cash flow from the transaction of financial assets. In addition, for the assessment of financial assets at fair value through other comprehensive income, we obtained from management the appraisal reports about the fair values of the underlying financial assets which were appraised by external experts. Moreover, for the valuation of financial assets at fair value through other comprehensive income in unlisted companies, we conducted a stock share count at the end of the year and obtained bank confirmations, in order to ascertain their existence.

The fair values of net assets of subsidiaries acquired

Please refer to note 4(t), “Business combination” for the accounting policies for the fair value of net assets of subsidiaries acquired, note 5 “Significant accounting assumptions and judgments, and major sources of estimation uncertainty” for estimation and assumption uncertainty, and note 6(f) “Business combination” for related disclosure.

Description of the key audit matter

In 2020, the Group acquired 82.13% equity interest in North Bay Recreation Co., Ltd. (“North Bay”). With more than 50 percent equity interest held, the Group gained control over North Bay and made it a subsidiary. Under the IFRSs No. 3 "Business Combinations “, the Group is required to determine the fair value of the identifiable assets acquired and liabilities assumed of North Bay at the date of acquisition. As the amount of such acquisition transaction is significant and the fair value of its net assets at the date of acquisition involves accounting estimates, failure to present the amount appropriately would result in misrepresentation of the financial statements. Therefore, this account was determined to have material impact on the financial statements.

How the matter was addressed in our audit

For the purchase price allocation report issued by the independent expert appointed by the Group, the audit procedures performed among others include: Evaluating related experience, competence, and reputation of the independent professional appraiser appointed by management with the appraiser’s objectivity taken into consideration; interviewing the appraiser to ascertain the scope and approaches adopted were in conformity with evaluation standards and industry specifications. Our internal specialist probed into the document related to the purchase price allocation report, and the reasonableness of the evaluation methodology adopted, with a view to ascertaining whether the fair value of the identifiable net assets of the acquired company was appropriate.

3. Revenue Recognition of Construction Contract

Refer to note 4(q) “Revenue from contracts with customers” for the accounting policies for revenue recognition, note 5 “Significant accounting assumptions and judgments, and major sources of estimation uncertainty”, and 6(q) “Revenue from contracts with customers” for the detail of revenue recognition during the year.

Description of the key audit matter

The major business activities of the Group include construction contracts entered into with clients, contributing a significant proportion to operating revenue. Since the revenue from construction contracts is recognized by the percentage of completion method during the contract period, and the revenue recognition involves significant accounting estimates such as estimated total cost of work, completion level, and variable consideration.

When determining transaction price, consideration, which may change due to discounts, rebates, penalties, or other similar items, shall be taken into account. Besides, the extent of completion is calculated based on the percentage of the cost arising from each contract of the estimated total cost of that construction contract as of the reporting date. Moreover, both the aforesaid changes in consideration and the estimated total cost involving accounting estimate give rise to uncertainty and impact the recognition of revenue from construction contracts. Accordingly, the recognition of the profit or loss on construction contracts was identified as a matter of importance in our audit of the Group’s consolidated financial statements.

How the matter was addressed in our audit

Our audit procedures in this area included, among others: Testing the internal control of the timing and accuracy of the recognition of revenue and costs to ascertain its effectiveness; sampling significant contracts and interviewing management so as to understand the specific terms and risks of each construction contract; testing the evaluation document and procedure taken by management to evaluate total estimated costs, completion of construction, profitability of contracts, and variable consideration; checking the procedure of construction estimation, as well as juxtaposing and reconciling the estimates with the general ledger, and assessing whether the recognition of revenue and cost of construction contracts was consistent with pertinent accounting standards.

Other Matter

Long Bon International Co., Ltd. has additionally prepared its parent-company-only financial statements as of and for the years ended December 31, 2020 and 2019, on which we have issued an unmodified 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 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 Audit Committee) are responsible for overseeing the Group s financial reporting process.

Auditors ’ Responsibilities for the Audit of the Consolidated Financial Statements

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

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

Assess for purposes of identifying 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 determine 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 and 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.

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

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of 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 Shu-Ying Chang and Mei-Pin Wu.

KPMG

Taipei, Taiwan (Republic of China) March 23, 2021

Notes to Readers

The accompanying consolidated financial statements are intended only to present the consolidated statement of financial position, financial performance and its 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 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 auditors’ report and consolidated financial statements, the Chinese version shall prevail.

(English Translation of Consolidated Financial Statements and Report Originally Issued in Chinese)

LONG BON INTERNATIONAL CO., LTD. AND SUBSIDIARIES

Consolidated Balance Sheets

December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

December 31, 2020 Assets Amount % Current assets: 1100 Cash and cash equivalents (Note 6(a)) $ 1,911,545 8 1110 Current financial assets at fair value through profit or loss (Note 6(b) and 8) 5,195,794 21 1140 Current contract assets (Note 6(q) and 9) 2,835,103 12 1150 Notes receivable, net (Note 6(d) and (q)) 313,159 1 1170 Accounts receivable, net (Note 6(d), (q), 7 and 9) 425,050 2 1200 Other receivables, net (Note 6(t) and 9) 55,513 - 1260 Current tax assets 341 - 1320 Inventories (for construction business), net (Note 6(e), 7, 8 and 9) 3,896,762 16 1476 Other current financial assets (Note 6(s), 8 and 9) 1,156,308 5 1479 Other current assets (Note 7) 227,286 2 1480 Current assets recognised as incremental costs to obtain contract with customers 32,662 - 16,049,523 67 Non-current assets: 1517 Non-current financial assets at fair value through other comprehensive income (Note 6(c)) 479,694 2 1535 Non-current financial assets at amortized cost, net (Note 13) 80,624 - 1550 Investments accounted for using equity method, net 3,829 - 1600 Property, plant and equipment (Note 6(e), (g) and 8) 5,466,743 23 1760 Investment property, net (Note 6(h), 7 and 8) 1,049,766 4 1780 Intangible assets (Note 6(f)) 86,289 - 1840 Deferred tax assets (Note 6(n)) 107,011 - 1755 Right-of-use assets 13,588 - 1975 Net defined benefit asset, non-current 10,863 - 1980 Other non-current financial assets (Note 7 and 8) 579,974 3 1990 Other non-current assets (Note 7 abd 9) 302,516 1 8,180,897 33 Total assets $ 24,230,420 100	December 31, 2020 Assets Amount % Current assets: 1100 Cash and cash equivalents (Note 6(a)) $ 1,911,545 8 1110 Current financial assets at fair value through profit or loss (Note 6(b) and 8) 5,195,794 21 1140 Current contract assets (Note 6(q) and 9) 2,835,103 12 1150 Notes receivable, net (Note 6(d) and (q)) 313,159 1 1170 Accounts receivable, net (Note 6(d), (q), 7 and 9) 425,050 2 1200 Other receivables, net (Note 6(t) and 9) 55,513 - 1260 Current tax assets 341 - 1320 Inventories (for construction business), net (Note 6(e), 7, 8 and 9) 3,896,762 16 1476 Other current financial assets (Note 6(s), 8 and 9) 1,156,308 5 1479 Other current assets (Note 7) 227,286 2 1480 Current assets recognised as incremental costs to obtain contract with customers 32,662 - 16,049,523 67 Non-current assets: 1517 Non-current financial assets at fair value through other comprehensive income (Note 6(c)) 479,694 2 1535 Non-current financial assets at amortized cost, net (Note 13) 80,624 - 1550 Investments accounted for using equity method, net 3,829 - 1600 Property, plant and equipment (Note 6(e), (g) and 8) 5,466,743 23 1760 Investment property, net (Note 6(h), 7 and 8) 1,049,766 4 1780 Intangible assets (Note 6(f)) 86,289 - 1840 Deferred tax assets (Note 6(n)) 107,011 - 1755 Right-of-use assets 13,588 - 1975 Net defined benefit asset, non-current 10,863 - 1980 Other non-current financial assets (Note 7 and 8) 579,974 3 1990 Other non-current assets (Note 7 abd 9) 302,516 1 8,180,897 33 Total assets $ 24,230,420 100	December 31, 2019 Amount % 3,574,648 19 3,762,442 20 2,969,218 16 343,556 2 901,485 5 313,557 2 483 - 3,107,365 17 1,327,738 7 173,777 1 26,245 -
	16,049,523 67	16,500,514 89
	479,694 2 80,624 - 3,829 - 5,466,743 23 1,049,766 4 86,289 - 107,011 - 13,588 - 10,863 - 579,974 3 302,516 1	445,558 2 - - 3,123 - 204,849 1 718,664 4 83,133 - 103,142 1 41,875 - 10,440 - 576,607 3 24,600 -
	8,180,897 33	2,211,991 11
	$ 24,230,420 100	18,712,505 100

See accompanying notes to consolidated financial statements.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese)

LONG BON INTERNATIONAL CO., LTD. AND SUBSIDIARIES

Consolidated Balance Sheets (CONT’D)

December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

December 31, 2020	December 31, 2020	December 31, 2020
Amount	%	Amount
9,298,705 40 7,307,894 39
32,101 - 18,539 - 2,469,730 10 2,466,135 13 281,310 1 325,740 2 118,554 - - - 496,955 2 216 - 5,014 - 10,766 - 1,994,081 8 4,662 -
5,397,745 21 2,826,058 15
14,696,450 61 10,133,952 54
3,947,293 16 4,047,293 22 146,633 1 130,417 1 5,875,475 24 4,885,506 26 (26,076) - (70,795) - (681,835) (3) (681,835) (4)
9,261,490 38 8,310,586 45
272,480 1 267,967 1
9,533,970 39 8,578,553 46
$ 24,230,420 100 18,712,505 100

See accompanying notes to consolidated financial statements.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese)

LONG BON INTERNATIONAL CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

For the Years Ended December 31, 2020 and 2019

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

2020	% 100 93	2019	% 100 95
Amount $ 10,776,324 9,996,651		Amount 9,295,613 8,831,441
779,673	7	464,172	5
56,356 386,138 -	1 4 -	58,751 309,988 (11,518)	1 3 -
442,494	5	357,221	4
337,179	2	106,951	1
28,447 216,523 746,724 (112,282) (1,221) 16,150	- 2 7 (1) - -	41,247 184,109 874,367 (107,125) (2,798) 15,000	1 2 9 (1) - -
894,341	8	1,004,800	11
1,231,520 103,183	10 1	1,111,751 224,558	12 2
1,128,337	9	887,193	10
(46) 30,949 - -	- - - -	(1,228) 37,542 (12,528) -	- - - -
30,903	-	23,786	-
(195) - (27)	- - -	1,316 29,990 (5,760)	- - -
(222)	-	25,546	-
30,681	-	49,332	-
$ 1,159,018	9	936,525	10
$ 1,100,637 27,700	10 -	865,253 21,940	9 -
$ 1,128,337	10	887,193	9
$ 1,130,315 28,703	9 -	920,375 16,150	10 -
$ 1,159,018	9	936,525	10
$	3.05		1.87
$	3.05		1.86

See accompanying notes to consolidated financial statements.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese)

LONG BON INTERNATIONAL CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Changes in Equity For the Years Ended December 31, 2020 and 2019 (Expressed in Thousands of New Taiwan Dollars)

	Equityattributable to owners ofparent	Equityattributable to owners ofparent
Capital stock Common stock Capital surplus	Retained earnings	Other equityinterest Unrealized Exchange differences on translation of foreign financial statements gains (losses) on financial assets measured at fair value through other comprehensive income Total other equityinterest Treasury shares Total equity attributable to owners of parent
	Legal reserve Unappropriated retained earnings Total retained earnings
- - - 865,253 865,253 - - - - 865,253 21,940 887,193 - - - (1,107) (1,107) 25,638 30,591 56,229 - 55,122 (5,790) 49,332
- - - 864,146 864,146 25,638 30,591 56,229 - 920,375 16,150 936,525
- - 2,510 (2,510) - - - - - - - - - - - (126,478) (126,478) - - - - (126,478) - (126,478) - - - (13,649) (13,649) 11,748 13,649 25,397 - 11,748 - 11,748 - 11,440 - - - - - - - 11,440 - 11,440 (1,011,823) - - - - - - - 91,522 (920,301) - (920,301) - (85,675) - - - - - - - (85,675) (295,073) (380,748) - (146) - (510) (510) - - - - (656) 656 - - - - (50) (50) - - - (773,357) (773,407) 551,777 (221,630) - - - - - - - - - - (5,827) (5,827) - - - 242,348 242,348 - (242,348) (242,348) - - - -
4,047,293 130,417 471,151 4,414,355 4,885,506 14,712 (85,507) (70,795) (681,835) 8,310,586 267,967 8,578,553 - - - 1,100,637 1,100,637 - - - - 1,100,637 27,700 1,128,337 - - - (41) (41) (239) 29,958 29,719 - 29,678 1,003 30,681
- - - 1,100,596 1,100,596 (239) 29,958 29,719 - 1,130,315 28,703 1,159,018
- - 86,525 (86,525) - - - - - - - - - - - - - - - - - - (12,182) (12,182) - - - - - - - - - - 153,305 153,305 - - - - - - - - (129,788) (129,788) - (129,788) (100,000) (398) - (29,390) (29,390) - - - 129,788 - - - - 16,614 - (66,237) (66,237) - - - - (49,623) (181,291) (230,914) - - - - - - - - - - 17,588 17,588 - - - - - - - - - - (1,610) (1,610) - - - (15,000) (15,000) - 15,000 15,000 - - - -
$ 3,947,293 146,633 557,676 5,317,799 5,875,475 14,473 (40,549) (26,076) (681,835) 9,261,490 272,480 9,533,970

See accompanying notes to consolidated financial statements.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese)

LONG BON INTERNATIONAL CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the Years Ended December 31, 2020 and 2019 (Expressed in Thousands of New Taiwan Dollars)

Cash flows from operating activities: Profit before tax Adjustments: Adjustments to reconcile profit (loss): Depreciation expense Amortization expense Impairment gain and reversal of impairment loss determined in accordance with IFRS 9 Net (gain) loss on financial assets or liabilities at fair value through profit or loss Interest expense Interest income Dividend income Share of loss of associates and joint ventures accounted for using equity method Gain on disposal of property, plan and equipment Loss on disposal of investment properties Loss (gain) on disposal of investments Profit from lease modification Impairment loss Total adjustments to reconcile profit (loss) Changes in operating assets and liabilities: Financial assets at fair value through profit or loss Contract assets Notes receivable Accounts receivable Other receivables Inventories Net defined benefit assets Other current financial assets Other current assets Current assets recognized as incremental costs to obtain contract with customers Other non-current financial assets Contract liabilities Notes payable Accounts payable Other payable Provisions Other current liabilities Total adjustments Cash outflow generated from operations Interest received Dividends received Interest paid Income taxes paid Net cash outflows from operating activities	2020 $ 1,231,520 54,750 8,215 (16,150) (767,795) 112,282 (28,447) (193,788) 1,221 (461) 9,360 1,496 (3) 7,312	2019 1,111,751 51,449 6,591 (26,518) 127,334 107,125 (41,247) (161,749) 2,798 (12) - (1,101,425) - -
	(812,008)	(1,035,654)
	(675,096) 134,130 30,397 477,920 (1,863) (667,579) (469) (256,999) (58,445) (6,417) - (81,033) (388,012) (399,450) 96,906 (1,045) (5,201)	(1,313,341) (1,045,531) (102,850) (218,632) (34,266) (250,743) (661) (132,091) 15,529 (26,245) (5,146) (452,188) 699,403 1,230,217 129,300 29,614 (47,775)
	(2,614,264)	(2,561,060)
	(1,382,744) 28,724 193,788 (112,550) (237,348)	(1,449,309) 37,106 161,749 (100,612) (241,565)
	(1,510,130)	(1,592,631)

See accompanying notes to consolidated financial statements.

Cash flows from investing activities: Acquisition of financial assets at fair value through other comprehensive income Proceeds from disposal of financial assets at fair value through other comprehensive income Acquisition of financial assets at amortized cost Acquisition of investments accounted for using equity method Proceeds from disposal of investments accounted for using equity method Prepayments for land and buildings Acquisition of subsidiaries (net of cash received) Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Acquisition of investment properties Other receivables Acquisition of intangible assets Proceeds from disposal of investment properties Other current financial assets Other non-current financial assets Other non-current assets Net cash (outflows) inflows from investing activities Cash flows from financing activities: Increase in short-term loans Increase (decrease) in short-term notes and bills payable Proceeds from long-term debt Repayments of long-term debt Increase in guarantee deposits received Payment of lease liabilities Cash dividends paid Capital reduction Repurchase of treasury shares Cash dividends paid by subsidiaries Acquisition of ownership interests in subsidiaries Change in non-controlling interests Net cash inflows (outflows) from financing activities Effect of exchange rate changes on cash and cash equivalents Net (decrease) increase in cash and cash equivalents Cash and cash equivalents, beginning of period Cash and cash equivalents, end of period	(88,187) (3,298) 112,052 1,718,472 (79,980) - (3,900) - 4,235 2,617,316 (230,280) - (303,916) 600,091 (1,683,117) (18,979) 2,883 12 (296,067) (48,420) 248,733 (185,000) (6,563) (2,465) 93,402 - 87,372 (29,867) (756) 704,582 (8,324) 930
	(2,152,413) 5,353,374
	2,277,772 900,450 168,317 (469,911) 202,520 - (264,524) (120,300) 1,345 497 (30,720) (27,827) - (115,038) - (920,301) (129,788) - (12,182) - (230,914) (380,748) 17,588 (25,902)
	1,999,414 (1,159,080)
	26 (565) (1,663,103) 2,601,098 3,574,648 973,550
	$ 1,911,545 3,574,648

Parent Company Only Financial Statements For the Year Ended December 31, 2020

Independent Auditors ’ Report

To the Board of Directors of Long Bon International Co., Ltd.:

Opinion

We have audited the financial statements of Long Bon International Co., Ltd.(“the Company”), which comprise the balance sheets as of December 31, 2020 and 2019, the statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the 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, 2020 and 2019, 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.

Acquisition, disposal and evaluation of financial assets

Refer to Note 4(f) “Financial instruments”, 6(b) and (c) “ Financial Assets” to the parent company only financial statements for the accounting policy and the details of the information.

Description of the key audit matter

The carrying amounts of ”financial assets at fair value through profit or loss”and ”financial assets at fair value through other comprehensive income” constitute 33% of total assets of the Company, which is significant for the financial statements as a whole. In addition, the Company’s recognized financial assets were evaluated at fair value. As for equity investment in unlisted companies, the fair value was obtained based on valuation technique or the quotation of the counterparty, and was recognized as "financial assets at fair value through other comprehensive income". Since the valuation result of financial assets involves the financial restriction clause of financial institutions loan agreement for financing, it further impacts working capital management. Therefore, the acquisition, disposal of financial assets and the testing of end of period valuation were determined to be a critical matter in our audit of Company’s consolidated financial reports.

How the matter was addressed in our audit

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 Regulations Governing the Preparation of Financial Reports by Securities Issuers, and for such internal control as management determines is necessary to enable the preparation of 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 Audit Committee) are responsible for overseeing the Company’ s financial reporting process.

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

Assess for purposes of identifying the risks of material misstatement of the parent company only financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the 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 parent company only financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our 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 parent company only financial statements, including the disclosures, and whether the parent company only financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient and appropriate audit evidence regarding the financial information of the investment in other entities accounted for using the equity method to express an opinion on the parent company only financial statements. We are responsible for the direction, supervision and performance of the audit. We remain solely responsible for our audit opinion.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of 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 Shu-Ying Chang and Mei-Pin Wu.

KPMG

Taipei, Taiwan (Republic of China) March 23, 2021

Notes to Readers

The accompanying parent company only financial statements are intended only to present the statement of financial position, financial performance and its 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 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 auditors’ report and parent company only financial statements, the Chinese version shall prevail.

(English Translation of Parent Company Only Financial Statements and Report Originally Issued in Chinese)

LONG BON INTERNATIONAL CO., LTD.

Balance Sheets

December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

December 31, 2020 Assets Amount % Current assets: 1100 Cash and cash equivalents (Note 6(a)) $ 976,771 7 1110 Current financial assets at fair value through profit or loss (Note 6(b) and 8) 3,981,640 30 1150 Notes receivable, net (Note 6(n) and 7) 45 - 1170 Accounts receivable, net (Note 6(n) and 7) - - 1200 Other receivables, net (Note 6(c), (q), 7 and 13) - - 1320 Inventories (for construction business), net (Note 6(d), 7 and 8) 1,851,108 14 1476 Other current financial assets (Note 8) - - 1479 Other current assets (Note 7) 5,429 - 6,814,993 51 Non-current assets: 1517 Non-current financial assets at fair value through other comprehensive income (Note 6(c) and 8) 398,746 3 1550 Investments accounted for using equity method, net (Note 6(e), (f) and 7) 4,916,982 37 1600 Property, plant and equipment 18,828 - 1760 Investment property, net (Note 6(g), 7 and 8) 702,581 5 1780 Intangible assets 135 - 1755 Right-of-use assets (Note 7) 1,322 - 1840 Deferred tax assets (Note 6(k)) 6,490 - 1980 Other non-current financial assets (Note 8) 567,733 4 1990 Other non-current assets, others (Note 7) 1,073 - 6,613,890 49 Total assets $ 13,428,883 100	December 31, 2020 Assets Amount % Current assets: 1100 Cash and cash equivalents (Note 6(a)) $ 976,771 7 1110 Current financial assets at fair value through profit or loss (Note 6(b) and 8) 3,981,640 30 1150 Notes receivable, net (Note 6(n) and 7) 45 - 1170 Accounts receivable, net (Note 6(n) and 7) - - 1200 Other receivables, net (Note 6(c), (q), 7 and 13) - - 1320 Inventories (for construction business), net (Note 6(d), 7 and 8) 1,851,108 14 1476 Other current financial assets (Note 8) - - 1479 Other current assets (Note 7) 5,429 - 6,814,993 51 Non-current assets: 1517 Non-current financial assets at fair value through other comprehensive income (Note 6(c) and 8) 398,746 3 1550 Investments accounted for using equity method, net (Note 6(e), (f) and 7) 4,916,982 37 1600 Property, plant and equipment 18,828 - 1760 Investment property, net (Note 6(g), 7 and 8) 702,581 5 1780 Intangible assets 135 - 1755 Right-of-use assets (Note 7) 1,322 - 1840 Deferred tax assets (Note 6(k)) 6,490 - 1980 Other non-current financial assets (Note 8) 567,733 4 1990 Other non-current assets, others (Note 7) 1,073 - 6,613,890 49 Total assets $ 13,428,883 100	December 31, 2019 Amount % 1,188,749 10 2,584,632 22 73 - 3 - 1,140,811 10 1,760,501 15 190 - 2,732 -
	6,814,993 51	6,677,691 57
	398,746 3 4,916,982 37 18,828 - 702,581 5 135 - 1,322 - 6,490 - 567,733 4 1,073 -	338,014 3 3,727,030 32 21,572 - 443,753 4 1,096 - 7,054 - 2,155 - 568,163 4 929 -
	6,613,890 49	5,109,766 43
	$ 13,428,883 100	11,787,457 100

See accompanying notes to parent company only financial statements.

(English Translation of Parent Company Only Financial Statements and Report Originally Issued in Chinese)

LONG BON INTERNATIONAL CO., LTD.

Balance Sheets (CONT’D)

December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

December 31, 2020	December 31, 2020	December 31, 2020
Amount	%	Amount
1,692,198 13 1,004,757 9
2,469,730 18 2,466,135 22 - - 1,343 - 5,465 - 4,636 -
2,475,195 18 2,472,114 22
4,167,393 31 3,476,871 31
3,947,293 29 4,047,293 34 146,633 1 130,417 1 5,875,475 44 4,885,506 41 (26,076) - (70,795) (1) (681,835) (5) (681,835) (6)
9,261,490 69 8,310,586 69
$ 13,428,883 100 11,787,457 100

See accompanying notes to parent company only financial statements.

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese)

LONG BON INTERNATIONAL CO., LTD.

Statements of Comprehensive Income

For the Years Ended December 31, 2020 and 2019

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

2020	% 100 54	2019 Amount % 17,813 100 11,021 62	2019 Amount % 17,813 100 11,021 62
Amount $ 20,513 11,128		Amount 17,813 11,021
9,385	46	6,792	38
17,495 102,150	85 498	21,651 113,673	122 638
119,645	583	135,324	760
(110,260)	(537)	(128,532)	(722)
32,411 175,784 640,462 (80,507) 454,275 8,267	158 857 3,122 (392) 2,215 40	37,543 118,271 993,622 (77,402) 95,626 7,500	211 664 5,578 (435) 537 42
1,230,692	6,000	1,175,160	6,597
1,120,432 19,795	5,463 96	1,046,628 181,375	5,875 1,018
1,100,637	5,367	865,253	4,857
28,014 1,903 -	137 9 -	35,091 (5,607) -	197 (31) -
29,917	146	29,484	166
(215) (24)	(1) -	31,408 (5,770)	176 (32)
(239)	(1)	25,638	144
29,678	145	55,122	310
$ 1,130,315	5,512	920,375	5,167
$	3.05		1.87
$	3.05		1.86

See accompanying notes to parent company only financial statements.

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese)

LONG BON INTERNATIONAL CO., LTD.

Statements of Changes in Equity

For the Years Ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

Balance on January 1, 2019 Profit Other comprehensive income Total comprehensive income Appropriation and distribution of retained earnings: Legal reserve appropriated Cash dividends of ordinary share Capital reduction Adjustments of capital surplus for company's cash dividends received by subsidiaries Proceeds from disposal of subsidiaries or investments accounted for using equity method Difference between consideration and carrying amount of subsidiaries acquired or disposed of Due to business combination Changes in ownership interests in subsidiaries Disposal of investments in equity instruments at fair value through other comprehensive income Balance on December 31, 2019 Profit Other comprehensive income Total comprehensive income Appropriation and distribution of retained earnings: Legal reserve appropriated Cash dividends of ordinary share Purchase of treasury share Retirement of treasury share Difference between consideration and carrying amount of subsidiaries acquired or disposed of Disposal of investments in equity instruments at fair value through other comprehensive income Balance on December 31, 2020	Share capital Common stock Capital surplus	Retained earnings
		Legal reserve Unappropriate d retained earnings Total retained earnings
	- - - 865,253 865,253 - - - - 865,253 - - - (1,107) (1,107) 25,638 30,591 56,229 - 55,122
	- - - 864,146 864,146 25,638 30,591 56,229 - 920,375
	- - 2,510 (2,510) - - - - - - - - - (126,478) (126,478) - - - - (126,478) (1,011,823) - - - - - - - 91,522 (920,301) - 11,440 - - - - - - - 11,440 - - - (13,649) (13,649) 11,748 13,649 25,397 - 11,748 - (85,675) - - - - - - - (85,675) - - - (50) (50) - - - (773,357) (773,407) - (146) - (510) (510) - - - - (656) - - - 242,348 242,348 - (242,348) (242,348) - -
	4,047,293 130,417 471,151 4,414,355 4,885,506 14,712 (85,507) (70,795) (681,835) 8,310,586 - - - 1,100,637 1,100,637 - - - - 1,100,637 - - - (41) (41) (239) 29,958 29,719 - 29,678
	- - - 1,100,596 1,100,596 (239) 29,958 29,719 - 1,130,315
	- - 86,525 (86,525) - - - - - - - - - - - - - - - - - - - - - - - - (129,788) (129,788) (100,000) (398) - (29,390) (29,390) - - - 129,788 - - 16,614 - (66,237) (66,237) - - - - (49,623) - - - (15,000) (15,000) - 15,000 15,000 - -
	$ 3,947,293 146,633 557,676 5,317,799 5,875,475 14,473 (40,549) (26,076) (681,835) 9,261,490

See accompanying notes to parent company only financial statements.

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese)

LONG BON INTERNATIONAL CO., LTD.

Statements of Cash Flows

For the Years Ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from operating activities: Profit before tax Adjustments: Adjustments to reconcile profit (loss): Depreciation expense Amortization expense Expected credit loss (gain) / Provision (reversal of provision) for bad debt expense Net loss (gain) on financial assets or liabilities at fair value through profit or loss Interest expense Interest income Dividend income Share of loss (profit) of subsidiaries,associates and joint ventures accounted for using equity method Loss (gain) on disposal of property, plan and equipment Loss (gain) on disposal of investments Total adjustments to reconcile profit (loss) Changes in operating assets and liabilities: Changes in operating assets: Net loss (gain) on financial assets or liabilities at fair value through profit or loss Notes receivable Accounts receivable Other receivable In inventories Other current assets Total changes in operating assets Changes in operating liabilities: Accounts payable Other payable Other current liabilities Total changes in operating liabilities Total changes in operating assets and liabilities Total adjustments Cash inflow (outflow) generated from operations Interest received Dividends received Interest paid Income taxes refund (paid) Net cash flows from operating activities	2020 $ 1,120,432 14,954 1,026 (8,267) (644,797) 80,507 (32,411) (157,460) (454,275) (735) -	2019 1,046,628 15,085 1,791 (7,500) (2,681) 77,402 (37,543) (110,168) (95,626) - (1,085,707)
	(1,201,458)	(1,244,947)
	(761,750) 28 3 38,267 (90,607) (2,697)	(1,078,551) 189 49 (29,957) (52,475) (306)
	(816,756)	(1,161,051)
	- 13,659 62	(2,800) 48,191 (753)
	13,721	44,638
	(803,035)	(1,116,413)
	(2,004,493)	(2,361,360)
	(884,061) 36,169 254,021 (80,437) (96,328)	(1,314,732) 33,785 143,857 (73,733) (231,370)
	(770,636)	(1,442,193)

See accompanying notes to parent company only financial statements.

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Cash flows from investing activities: Acquisition of financial assets at fair value through other comprehensive income Proceeds from disposal of financial assets at fair value through other comprehensive income Acquisition of investments accounted for using equity method Proceeds from disposal of investments accounted for using equity method Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Increase in other receivables Acquisition of investment properties Proceeds from disposal of investment properties Increase in other financial assets Decrease in other financial assets Increase in other non-current assets Net cash flows from (used in) investing activities Cash flows from financing activities: Increase in short-term loans Decrease in short-term notes and bills payable Increase in guarantee deposits received Payment of lease liabilities Cash dividends paid Capital reduction payments to shareholders Payments to acquire treasury shares Net cash flows from 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	(75,218) - 69,552 1,678,696 (901,874) (1,275,915) - 2,321,547 (119) - 1,644 - 1,080,000 (1,072,500) (296,067) (161) 51,593 - 190 100,821 430 701,936 (209) -
	(70,078) 2,454,424
	664,000 784,000 99,406 (99,974) 829 683 (5,711) (5,860) - (126,478) - (1,011,823) (129,788) -
	628,736 (459,452)
	(211,978) 552,779 1,188,749 635,970
	$ 976,771 1,188,749

Long Bon International Co., Ltd. Attachment 4

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Comparison Table for Amendments to Operational Procedures for Loan of Funds to Others

	~~After Amendment~~		~~Before Amendment~~	Description
	Article 5: Deadline and Interest Calculation of Loans Deadline for each loan of funds shall be in principle no later than one year or one operating cycle from the date of first disbursement. Interests for the funds loaned from the Company are calculated by day, at the amount of sum of daily loan balance multiplied by its annual interest rate and divided by 365. Calculation and collection of interests accrued from loans from the Company shall be in principle paid once every month, with notices delivered to the borrower one week prior to the agreed interest payment date. Upon special circumstances, the agreed payment date may be adjusted in accordance with actual conditions under approval by the Board of Directors.		Article 5: Deadline and Interest Calculation of Loans Deadline for each loan of funds shall be in principle no later than one year or one operating cycle from the date of disbursement. The interest rate for loans of funds to others may not be lower than the highest interest rate for the short-term financing facilitations of the Company from financial institutions. Interests for the funds loaned from the Company are calculated by day, at the amount of sum of daily loan balance multiplied by its annual interest rate and divided by 365. Calculation and collection of interests accrued from loans from the Company shall be in principle paid once every month, with notices delivered to the borrower one week prior to the agreed interest payment date. Upon special circumstances, the agreed payment date may be adjusted in accordance with actual conditions under approval by the Board of Directors.	Deleted definitions of interest rate standards for loan of funds
	Article 7: Subsequent Control Measures for the Loaned Funds and Handling Procedure for Overdue Obligations After the loan is disbursed, the Company shall pay constant attention to the		Article 7: Subsequent Control Measures for the Loaned Funds and Handling Procedure for Overdue Obligations After the loan is disbursed, the Company shall pay constant attention to the	Amended methods for handling loans by borrowers upon expiration

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Borrower and Guarantor’s financial, business and relevant credibility status. Where a collateral is offered, the Company shall also notice the changes in its collateral value; in event of material changes, such change shall be notified to the Chairman and make handling as appropriate following instructions. In case the Borrower repays the loan upon or prior to maturity, the interest accrued shall be calculated and repaid along with the principle before the promissory note for loans is cancelled and returned to the Borrower or conducting collateral cancellation. In case of maturity of loans, the Borrower shall not repay the loan with unrightful payment flows or have such loan deferred by extending the period of repayment as agreed by the Board of Directors of the Company.		Borrower and Guarantor’s financial, business and relevant credibility status. Where a collateral is offered, the Company shall also notice the changes in its collateral value; in event of material changes, such change shall be notified to the Chairman and make handling as appropriate following instructions. In case the Borrower repays the loan upon or prior to maturity, the interest accrued shall be calculated and repaid along with the principle before the promissory note for loans is cancelled and returned to the Borrower or conducting collateral cancellation. In case of maturity of loans, the Borrower shall immediately repay the principle and interests of the loan. Where an extension is required due to failure of repayment, a request for such extension shall be made one month prior to the previous maturity and reported to the Board of Directors for approval. The extension shall not be more than three months and shall not be more than once. The Company may directly take disposal and recovery over the collateral or guarantor offered in accordance with relevant laws and regulations.

Long Bon International Co., Ltd. Appendix 1

Articles of Incorporation

[Chapter 1 General Provisions]

Article 1: The Company is incorporated in accordance with the Company Act and registered under the business name of “ 龍邦國際興業股份有公司 ” (Long Bon International Co., Ltd.)

Article 2: The Company’s scope of services is set out hereunder:

(1) J901020 Hotels and Motels

(2) E801010 Indoor Decoration

(3) F111090 Wholesale of Building Materials

(4) F113010 Wholesale of Machinery

(5) F211010 Retail Sale of Building Materials

(6) F213080 Retail Sale of Other Machinery and Equipment

(7) H701040 Specific Area Development

(8) H701060 New Towns, New Community Development

(9) I102010 Investment Consulting

(10) I103060 Management Consulting

(11) 1503010 Landscape and Interior Designing
(12) JD01010 Industrial and Commercial Credit Checking Service

(13) JE01010 Rental and Leasing

(14) H701010 Housing and Building Development and Rental
(15) H701020 Industrial Factory Development and Rental
(16) H703090 Real Estate Commerce
(17) H703100 Real Estate Leasing
(18) F301010 Department Stores
(19) F401010 International Trade
(20) 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 re-investments may be more than 40 percent of the paid-in capital.
Article 2-2: The Company may make guarantees externally as the needs of the business may require.
Article 3: The Company shall have its head office in Taipei City, the Republic of China, and may, pursuant to a resolution adopted at the meeting of the Board of Directors, set up branch offices within or outside the territory of the Republic of China when deemed necessary.
Article 4: (Deleted)

[Chapter 2 Shares]

Article 5: The total amount of the Company’s capital is NTD 7,200,000,000, which is divided into 720,000,000 shares, with a value per share of NTD 10, with the unissued shares to be issued by installments by the Board of Directors under authorization.
Article 6: The Company may be exempted from printing its share certificate, and shall register the issued shares with a centralized securities depositary enterprise.
Article 7: Stock affairs of the Company stocks shall be conducted in accordance with the “Regulations Governing the Administration of Shareholder Services of Public Companies” promulgated by competent authority and other relevant laws and regulations.
Article 8: Deleted.

Article 9: Deleted.

Article 10: Deleted.

Article 11: Transfer of shares will not be altered within 60 days prior to the convening date of a regular shareholders' meeting, or within 30 days prior to the convening date of a special shareholders' meeting, or within 5 days prior to the target date fixed by the Company for distribution of dividends, bonus or other benefits.

[Chapter 3 Shareholders’ Meetings]

Article 12: Shareholders’ meetings of the Company are of two kinds: (1) regular meeting and (2) special meeting. Regular meetings shall be convened at least once a year by the Board of Directors according to the law within six months after close of each fiscal year. Notice for convening of a regular shareholders’ meeting shall be sent to each shareholder 30 days prior to the meeting. A special shareholders’ meeting may be convened in accordance with relevant laws and regulations when necessary.
Article 13: In case a shareholder cannot attend a shareholders’ meeting, the shareholder may appoint a proxy to attend the meeting by providing the proxy form issued by the Company and stating the scope of the proxy's authorization. Concerning the regulations for appointment by shareholders, in addition to the provision of Article 177 of the Company Act and Article 25-1 of the Securities and Exchange Act, the conducts shall be made in accordance with “Regulations Governing the Use of Proxies for Attendance at Shareholder Meetings of Public Companies” as promulgated by competent authorities.
Article 14: If a shareholders meeting is convened by the board of directors, the meeting shall be chaired by the chairperson of the board. When the chairperson of the board is on leave or for any reason unable to exercise the powers of the chairperson, the vice chairperson shall act in place of the chairperson; if the vice chairperson also is on leave or for any reason unable to exercise the powers of the vice chairperson, a managing directors shall act as chair, or, if the managing director also is on leave or for any reason unable to exercise the powers of the managing director, the directors shall select from among themselves one person to serve as chair; if a shareholders meeting is convened by a party with power to convene but other than the board of directors, the convening party shall chair the meeting. When there are two or more such convening parties, they shall mutually select a chair from among themselves.
Article 15: Except in the circumstances of restrictions or otherwise provided for in Article 179, Paragraph 2 of the Company Act concerning the shares without voting rights, a shareholder of the Company shall have one voting power in respect of each share in his/her/its possession.
Article 16: Except as otherwise provided in the Company Act, the passage of a proposal shall require an affirmative vote of a majority of the voting rights represented by the

attending shareholders.

Article 17: Resolutions adopted at a shareholders' meeting shall be recorded in the minutes of the meeting and shall be handled in accordance with Article 183 of the Company Act.

[Chapter 4 Directors and Audit Committee]

Article 18: The Company shall have 7 to 9 Directors, among which shall include not less than 2 independent director members, and not less than one-fifth of the director seats shall be held by independent directors, to be elected at the shareholders meeting from among the individuals of legal capacity, with the term of three years. All Directors shall be eligible for re-election. In the aforesaid number of directors of the Company.
A candidates nomination system is adopted by the Company for election of the directors of the Company, whose nomination handled in accordance with Article 192 of the Company Act.
Total number of registered shares of the Company as held by all directors shall be conducted in accordance with Article 26 of the Securities and Exchange Act. The Company may establish an audit committee constituted by all independent directors. Number of members, terms, duties and rules for meeting procedure of the audit committee shall be transacted in accordance with relevant laws and regulations or provisions under organic rules of the Company.
Compensation of all directors (including Chairman) shall be agreed to by the Board of Directors under authorization based on their degree of involvement in the operations of the Company and values contributed, with reference to general level as offered by other companies in the same industry.
The Company may, with assignments to the Board of Directors under authorization, obtain liability insurance for directors with respect to liabilities resulting from exercising their duties during their terms of directorship.
Article 19: When the number of directors falls below two-third of all directors, the Company shall call a special shareholders meeting within 60 days from such occurrence to hold a by-election to fill the vacancies, where the term of the elected directors shall be limited to unexposed term of office of the predecessor.
Article 20: In case no election of new directors is effected after expiration of the term of office of existing directors, the term of office of out-going directors shall be extended until the time new directors have been elected and assumed their office.
Article 21: A Board of Directors’ meeting shall have the Chairman of the Company elected via adoption by a majority of attending directors in a meeting attended by two-third of all directors; the Vice Chairman shall be elected among themselves when necessary.
The Chairman shall serve as the chair of shareholders’ meetings and the Board of Directors’ meetings internally and represent the Company externally. In case the Chairman is on leave or is unable to exercise his/her duties, his/her proxy shall be made in accordance with Article 208 of the Company Act.
Article 22: Management guidelines and other important matters of the Company shall be decided by the Board of Directors.
Except as the first meeting of each newly elected board of directors is called in accordance with Article 203 of the Company Act, where a Board of Directors’ meeting is called by the chairperson of the board, the meeting shall be chaired by the chairperson.
A Board of Directors’ meeting shall be convened at least once quarterly, and a notice with reasons for convening such meeting shall be sent to each director 7 days prior to the meeting date;

In the case of emergency, a Board of Directors’ meeting may be convened at any time without sending notices 7 days prior to the meeting date. The notice for calling a meeting of the directors may be effected by means of writing, electronic email or facsimile.

Article 23: The resolutions in a Board of Directors’ meeting shall be adopted by a majority of attending directors in the meeting attended by more than a majority of all directors, except as otherwise provided by the Company Act. In case a director unable to exercise his/her functional duties for any reason, he/she shall, in each time, issue a written proxy and state therein the scope of authority with reference to the subjects to be discussed at the meeting to appoints another director to attend a Board of Directors’ meeting on his/her behalf; however, a director may accept the appointment to act as the proxy of one other director only.
Where a Board of Directors’ meeting is convened, presidents, vice presidents and other personnel engaging in relevant businesses may be invited for attendance under non-voting rights. In case a Board of Directors’ meeting is proceeded via visual communication network, the directors taking part in such a visual communication meeting shall be deemed to have attended the meeting in person.
Article 24: Resolutions adopted at a Board of Directors' meeting shall be recorded in the minutes of the meeting, which shall be affixed with the signature or seal of the chairman of the meeting and shall be distributed to all shareholders of the company within twenty (20) days after the close of the meeting. The minutes of meeting shall record a summary of the essential points of the proceedings and the results of the meeting. The minutes shall be kept at the Company along with the attendance book signed by attending directors and power of attorney handed in by proxies.

Article 25: Deleted.

[Chapter 5 Managerial Officer]

Article 26: The Company may have one or more managerial officers. Appointment, discharge and the remuneration of the managerial officers shall be in compliance with Article 29 of the Company Act.
Article 27: The Company may, as resolved by the Board of Directors, employ consultants or important specialists after a resolution by the Board of Directors of the Company following Article 23 herein is adopted.
Article 28: In case a shareholder or a director take concurrent role as a managerial officer or an employee, such role may claim the salary as a generic employee without regards to the gain/loss of the Company, and shall not be entitled to any privileges without exception of the rights as bestowed in shareholders’ meetings.
Article 29: Deleted.

[Chapter 6 Final Statements]

Article 30: After the close of each fiscal year, the following reports and statements shall be prepared by the Board of Directors, and shall be submitted to the supervisors for review before submitting to the regular meeting of shareholders for acceptance 30 days prior to the meeting date of a regular shareholders’ meeting:
(1) Report on Operations.
(2) Financial Statements.
(3) Proposals Concerning Appropriation of Net Profits of Making Up.
Article 31: If there is profit at the end of each fiscal year, a ratio of no less than 1% shall be distributed as employees’ compensation and a ratio no less than 3.5% shall be distributed as directors’ compensation. However, the Company’s accumulated

losses shall have been covered first.

Parties entitled to receive shares or cash as employees’ compensation as mentioned in the preceding paragraph may include the employees of parents or subsidiaries of the Company meeting certain specific requirements, whose conditions and methods shall be adopted by special resolution by the Board of Directors and reported to the shareholders’ meeting.

Article 31-1: As the industry the Company is under is currently in maternity, and due to the Company’s development in diversification, in consideration of overall circumstances as well as the Company’s operation characteristics, dividend policy of the Company shall take into considerations of the Company’s needs for capital in mid- to long-term operation growth and the sound financial structure along with consideration of shareholders’ equity. Dividend distribution shall be in principle made in equity and cash, among which the cash dividend shall not be less than 10% of the total dividend; however, in case the cash dividend is below NTD 0.5 per share, the distribution may be made in stock dividend in lieu of cash dividend.

Article 31-2: Deleted.

Article 31-3: After closing of accounts, if there are earnings, the Company shall first pay the tax, make up the losses for the preceding years, and set aside a legal reserve of 10% of the net profit, however, this does not apply where the legal reserve reaches the Company’s paid-in capital; in addition, depending on the operation needs or allotment or reverse of special reserves, if there are still earnings, such earnings shall be combined with beginning undistributed earnings and distributed under the proposal of earnings distribution as proposed by the Board of Directors before submitted to the shareholders’ meeting for distribution.

[Chapter 7 Additions]

Article 32: The internal organizational and regulations governing conducts of the Company shall be set forth by the Board of Directors.

Article 33: In regard to all matters not provided for in these Articles of Incorporation, the Company Act and other relevant laws and regulations shall govern.

Article 34: These Articles of Incorporation are agreed to and signed on January 15, 1988;

1[st] Amendment was made on July 15, 1988;
2[nd] Amendment was made on July 16, 1989;
3[rd] Amendment was made on August 31, 1989;
4[th] Amendment was made on July 16, 1989;
5[th] Amendment was made on June 5, 1990;
6[th] Amendment was made on March 29, 1991;
7[th] Amendment was made on March 28, 1992;
8[th] Amendment was made on April 29, 1993;
9[th] Amendment was made on April 23, 1994;
10[th] Amendment was made on May 6, 1995;
11[th] Amendment was made on May 4, 1996;
12[th] Amendment was made on June 18, 1997;
13[th] Amendment was made on April 10, 1998; 14[th] Amendment was made on April 29, 1999; 15[th] Amendment was made on June 23, 2000;
16[th] Amendment was made on June 15, 2001; 17[th] Amendment was made on June 28, 2002; 18[th] Amendment was made on June 20; 2003; 19[th] Amendment was made on June 24, 2005;

20[th] Amendment was made on June 15, 2006; 21[st] Amendment was made on June 16, 2009; 22[nd] Amendment was made on May 6, 2010; 23[rd] Amendment was made on June 17, 2011; 24[th] Amendment was made on June 12, 2012; 25[th] Amendment was made on May 7, 2013; 26[th] Amendment was made on June 29, 2015; 27[th] Amendment was made on May 13, 2016; 28[th] Amendment was made on June 15, 2017; 29[th] Amendment was made on June 21, 2018; 30[th] Amendment was made on June 27, 2019; 31st Amendment was made on June 18, 2020.

Appendix 2

Long Bon International Co., Ltd.

Operational Procedure for Loan of Funds to Others

I. Purpose

There Procedures are set forth as basis of the Company’s operational procedure for loan of funds to others.

II. Contents
Article 1: Borrower: As per regulations of the Company Act, the Company shall not loan funds to any of its shareholders or any other person except under the following circumstances:
(1) Where an inter-company or inter-firm business transaction calls for a loan arrangement, in which the business transaction refers to companies having purchase or sales of goods with the Company.
- (2) Where an inter-company or inter-firm short-term financing facility is necessary, in which the term "short-term" as used means one year, or where the Company's operating cycle exceeds one year, one 。
- operating cycle
Article 2: The necessity of and reasonableness of extending loans to others Where funds are loaned for reasons of business dealings between the Company and other companies or firms, the transaction shall be made in accordance with the provisions of Article 3, Paragraph 2 herein; where an inter-company or inter-firm short-term financing facility is necessary, the loans shall be made with limitations as follows:
- (1) Where a short-term financing facility is necessary for a company with more than 20% of the shares held by the Company.
- (2) Where a short-term financing facility is necessary to the other companies or firms due to needs for material purchases or turnover.
- (3) Other loan of funds as agreed by the Board of Directors of the Company.
Article 3: Limits on the aggregate amount of such loans and on the amount of such loans permitted to a single borrower
1. Where the loan of funds is provided to the company or business which the Company makes business dealings, the aggregate amount of loans shall not exceed 40 percent of the Company’s net value; The amount of loan refers to cumulative balance of short-term financial facilitation made by the Company.
2. The amount of a single loan to the companies or businesses with who the Company does business shall not be more than the amount the company or business made business dealings with the Company. The business dealings refers to the purchases or sales to the company or business made to the Company, whichever is higher.
3. Where an inter-company or inter-firm short-term financing facility is necessary, provided that such financing amount shall not exceed 10 percent of the Company's net value.

Where a foreign company in which the Company directly and indirectly holds 100 percent of the voting shares makes loans to the Company, the aggregate of loans shall not be more than 80% of the Company’s net value.
"Net worth" in these Operational Procedure means the balance sheet equity attributable to the owners of the parent company under the Regulations Governing the Preparation of Financial Reports by Securities Issuers.

Article 4: Operational Procedure for Loaning

(1) Credit Status Check

Where the Company conducts matters concerning loan of funds, the borrower shall make application in writing with necessary information of itself and the financial information to the Company when applying for the line of credit of such loan.

Following the acceptance of such application, the Company shall assign its financial department to perform investigations and assessments based on the borrower’s scope of business, financial status, capability of repayment and credit, profitability and use of such loaning, etc., with reports prepared for reference.

The financial department shall make detailed appraisal and review based on the borrower, which the appraisal items shall at least include:

The necessity of and reasonableness of extending loans to others.
Measurement on the necessity of the amount of loaning based on the borrower’s financial condition.
Whether the cumulative amount for the loan of funds is still within the limit.
Impact on the Company's business operations, financial condition, and shareholders' equity.
Whether collateral must be obtained and appraisal of the value thereof.
Reflection on credit status examination and risk assessment records of the borrower.
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 Operational Procedure or the loan balance exceeds the limit, the Company shall adopt rectification plans and submit the rectification plans to the Audit Committee, and shall complete the rectification according to the timeframe set out in the plan.

(2) Security

Where the Company transact loaning of funds to others, the Company shall obtain a promissory note with a carrying value same as the loan, and shall conduct pledge of properties or real estate when necessary; for the guarantee of creditor’s rights as mentioned in the preceding paragraph, where the debtor provides individual or company with equivalent financial strength and

credibility in lieu of collateral, the Board of Directors may make transactions with reference to the financial department’s credit status report; where a guarantee is made with a company, the Company shall pay notices to its articles of incorporation for the provisions set forth concerning guarantees to others.

(3) Scope of Authorization
Transaction of loaning of funds by the Company shall be conducted after credit status check by the financial department of the Company, submission for approval by the President and reporting to the Board of Directors for resolution.
Loans of funds between the Company and its parent company or subsidiaries, or between its subsidiaries, shall be submitted for a resolution by the Board of Directors pursuant to the preceding paragraph, and the chairperson may be authorized, for a specific borrowing counterparty, within a certain monetary limit resolved by the Board of Directors, and within a period not to exceed one year, to give loans in installments or to make a revolving credit line available for the counterparty to draw down.
The "certain monetary limit" mentioned in the preceding paragraph on authorization for loans extended by the Company or any of its subsidiaries to any single entity shall not exceed 10% of the net worth on the most current financial statements of the lending company, except in cases of companies in compliance with Article 3, paragraph 4.
Where the Company has appointed independent directors, when it loans funds to others, it shall take into full consideration each independent director's opinions; independent directors' opinions specifically expressing assent or dissent and their reasons for dissent shall be included in the minutes of the Board of Directors' meeting.

Article 5: Deadline and Interest Calculation of Loans

Deadline for each loan of funds shall be in principle no later than one year or one operating cycle from the date of disbursement. The interest rate for loans of funds to others may not be lower than the highest interest rate for the short-term financing facilitations of the Company from financial institutions.

Interests for the funds loaned from the Company are calculated by day, at the amount of sum of daily loan balance multiplied by its annual interest rate and divided by 365.

Calculation and collection of interests accrued from loans from the Company shall be in principle paid once every month, with notices delivered to the borrower one week prior to the agreed interest payment date. Upon special circumstances, the agreed payment date may be adjusted in accordance with actual conditions under approval by the Board of Directors

Article 6: Review Procedure

(1) Application Procedure

The borrower shall provide basic information and financial information, and submit an application form stating usage of funds, loan duration and amount of loan to the Company’s transacting department.
Where funds are loaned for reasons of business dealings, the handling personnel from the financial department of the Company shall evaluate whether the amount of a loan is commensurate to the total amount of trading between the two companies; where short-term financing is needed, the reasons for and conditions of extending loans shall be enumerated, and an extra credit assessment shall be performed. After the relevant information and proposed loan terms are reported the supervisor of the financial department, the reported items shall be submitted to the Board of Directors for resolution
(2) Credit Status Examination
For the borrower making first loan, the borrower shall offer basic information and financial information for credit status examination.
For the borrowers continuing the loans, the credit status check is in principle re-examined upon claim of continuing the loans. Should it be of material case, examinations once every half a year shall be taken based on actual needs.
If the borrower is with good financial condition and the yearly financial statements whose financing certificate has been handled by an entrusted accountant, the borrower may use the examination report prepared in less than a year along with the certified report by an accountant from the same period as reference of loans.
When the Company performs credit status examination on the borrower, the impacts on the Company’s management risks, financial status and shareholders’ equity after making loans to the borrower shall also be evaluated.
(3) Approval of Loans and Notice
If, after credit status examination and evaluation, the Board of Directors has reached a resolution not to make loans, the handling personnel shall sign and approve the reasons of denial to the borrower as soon as possible.
If, after credit status examination and evaluation, the Board of Directors has reached a resolution to make loans, the handling personnel shall, as soon as possible, notify the borrower in writing stating borrowing conditions of the Company including credit, expiration date, interest rate, collateral and guarantor, etc., and ask the borrower to sign the contract before expiration date.
(4) Contract Signing and Identity Verification
Contract and provision of the borrowing case shall be proposed

by the handling personnel and shall be signed after review by the managing personnel and submission to the legal consultant for approval.

  2. Content of the contract shall match the loan conditions. After the contract has been signed by the borrower and surety, the identity verification shall be made by the handling personnel.

(5) Collateral Value Appraisal and Setting of Rights
- Where the loan of the Company requires collaterals, a pledge or mortgage shall be made, and the Company will also perform collateral value appraisal to ensure its rights.
(6) Insurance
1. Except land or negotiable securities, all collaterals shall be insured with fire insurance. The amount insured shall in principle not be lower than the value of mortgage, and the Company shall be noted on the insurance policy as beneficiary. Name of subject matter, quantity, storage location, insurance terms and insurance endorsement shall match the Company’s original loan funding terms.
2. The handling personnel shall notice the expiration of duration and notify the borrower to extend the insurance before expiration.
(7) Drawdown
- Where the lending/borrowing case is approved with its contract signed by the borrower and creation of the collateral’s mortgage (pledge) is properly handled, the drawdown can be performed if all the procedures are verified correct.
Article 7: Subsequent Control Measures for the Loaned Funds and Handling Procedure for Overdue Obligations
After the loan is disbursed, the Company shall pay constant attention to the Borrower and Guarantor’s financial, business and relevant credibility status. Where a collateral is offered, the Company shall also notice the changes in its collateral value; in event of material changes, such change shall be notified to the Chairman and make handling as appropriate following instructions.
In case the Borrower repays the loan upon or prior to maturity, the interest accrued shall be calculated and repaid along with the principle before the promissory note for loans is cancelled and returned to the Borrower or conducting collateral cancellation.
In case of maturity of loans, the Borrower shall immediately repay the principle and interests of the loan. Where an extension is required due to failure of repayment, a request for such extension shall be made one month prior to the previous maturity and reported to the Board of Directors for approval. The extension shall not be more than three months and shall not be more than once. The Company may directly take disposal and recovery over the collateral or guarantor offered in accordance with relevant laws and regulations.
Article 8: Registration and Custody of Cases
The Company shall prepare a memorandum book for its fund-loaning activities and truthfully record the following information: borrower,

amount, date of approval by the Board of Directors, lending/borrowing date, and matters to be carefully evaluated these Operational Procedure.

After drawdown, the handling personnel of the case shall, on the case handled itself, organize the contract, certificate of the obligatory claim , and collateral identification, insurance policy, business dealing documents in sequence before putting into the custody bag, and note items contained and client name before submitting to the supervisor for examination. If no error has been found in the examination, the bag shall be sealed promptly, seal on perforation with handling personnel and supervisor’s chop, and send to custody after registered on custody item register book.
Article 9: Procedures for controlling and managing loans of funds to others by subsidiaries
Where a subsidiary of the Company intends to make loans to others, the Company shall instruct it to formulate its Procedures for Loaning Funds to Others in accordance with “ Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies” and perform loans accordingly; however, the net value available for loans is calculated based on the subsidiary’s net value.
Subsidiaries shall announce and report the previous month's loan balances of its head office and subsidiaries before the 10th day of each month, with the report submitted to the Company.
The Company's internal auditors shall audit this Procedures and the implementation thereof no less frequently than quarterly and prepare written records accordingly. They shall promptly notify the audit committee in writing of any material violation found. The audit committee shall submit the information in writing to the Audit Committee.
When the Company’s audit personnel performs audit at the subsidiary following the annual audit plans, the personnel shall also examine the implementation of the subsidiary’s Procedures for Loaning of Fund to Others. If any deficiency is found, continual follow-ups shall be made and compile into a follow-up report submitted to President. (or the Chairman, depending on the affiliation of such audit unit)

Article 10: Information Disclosure

The Company shall announce and report the previous month's loan balance of itself and its subsidiaries by the 10th day of each month to MOPS.
Where the Company’s loan balance of funds reach one of the following levels, the Company shall announce and report such event to the M.O.P.S. within two days commencing immediately from the date of occurrence:
- (1) The aggregate loan balance to others by the Company and its subsidiaries reaches 20 percent or more of the public company's net worth as stated in its latest financial statement.
- (2) The loan balance by the Company and its subsidiaries to a

single enterprise reaches 10 percent or more of the Company's net worth as stated in its latest financial statement.

(3) The amount of new loans of funds by the Company or its subsidiaries reaches NTD 10 million or more, and reaches 2 percent or more of the public company's net worth as stated in its latest financial statement.
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 subparagraph 3 of the preceding paragraph. The ratio of a subsidiary’s balance of loan to the net value is calculated based on the ratio of subsidiary’s balance of loan to the net value of the Company.
The Company shall evaluate the status of its loans of funds and reserve sufficient allowance for bad debts, and shall adequately disclose relevant information in its financial reports and provide certified public accountants with relevant information for implementation of necessary auditing procedures.
“Date of occurrence” as mentioned in these Operational Procedures 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.

Article 11: Penal Provisions

When any manager and personnel of the Company violate these Operational Procedures, the penalty shall be handled in accordance with the rules of the Company’s regulations governing incentives and discipline for submission and examination and depending on the severity.

Article 12: These Operational Procedure are signed on and agreed to on June 20, 2003. 1st Amendment was made on June 16, 2009;

2nd Amendment was made on May 6, 2010;

3rd Amendment was made on May 7, 2013;

4th Amendment was made on June 15, 2017;

5th Amendment was made on June 27, 2019.

III. Enforcement and Amendments Hereto

These Operational Procedures shall be agreed by the audit committee and, after passage by the Board of Directors, submit for approval by the shareholders' meeting. Where there any director expresses dissent and it is contained in the minutes or a written statement, the company shall submit the dissenting opinions to each supervisor and for discussion by the shareholders' meeting. The same shall apply to any amendments to these Operational Procedures.

In addition, where the Company has established the position of independent director, when these Operational Procedures are submitted for discussion by the Board of Directors under the preceding paragraph, the Board of Directors shall take into full consideration each independent director's opinion; independent directors' opinions specifically expressing assent or dissent and their reasons for dissent shall be included in the minutes of the Board of Directors' meeting.

Long Bon International Co., Ltd. Appendix 3

Rules of Procedure for Shareholders’ Meeting

Article 1. Scope of Application

The rules of procedures for the Company’s shareholders’ meetings shall be as provided in these Rules.
Article 2. Attendance and Sign-In
Shareholders and their proxies (collectively, "shareholders") shall attend shareholders’ meetings based on attendance cards, sign-in cards, or other certificates of attendance; solicitors soliciting proxy forms shall also bring identification documents for verification. The Company shall furnish the attending shareholders with an attendance book to sign, or attending shareholders may hand in a sign-in card in lieu of signing in.
Article 3. Calculation Basis for Attendance and Voting
Attendance and voting at shareholders meetings shall be calculated based on numbers of shares. The number of shares in attendance shall be calculated according to the shares indicated by the attendance book and sign-in cards handed in plus the number of shares whose voting rights are exercised by correspondence or electronically.

Article 4. Meeting Location and Time

The venue for a shareholders meeting shall be the premises of the Company, or a place easily accessible to shareholders and suitable for a shareholders meeting. The meeting may begin no earlier than 9 a.m. and no later than 3 p.m.

Article 5. Chair of Shareholders’ Meetings
<1> If a shareholders meeting is convened by the Board of Directors, the meeting shall be chaired by the chairperson of the board. When the chairperson of the board is on leave or for any reason unable to exercise the powers of the chairperson, the chairperson shall appoint one of the directors to act as chair, or, where the chairperson does not make such a designation, the directors shall select from among themselves one person to serve as chair.
<2> If a shareholders meeting is convened by a party with power to convene but other than the Board of Directors, the convening party shall chair the meeting.
Article 6. Other Persons in Attendance

The Company may appoint its attorneys, certified public accountants, or related persons retained by it to attend a shareholders meeting.

Article 7. Identification of Staff Handling Administrative Affairs
Staff handling administrative affairs of a shareholders meeting shall wear identification cards or arm bands.
Article 8. Documentation of a Shareholders Meeting
The Company shall make an uninterrupted audio and video recording of the proceedings
of the shareholders meeting. The recorded materials of the preceding paragraph shall be retained for at least one year.
Article 9. Rules of Proceedings

<1> The chair shall call the meeting to order at the appointed meeting time. However, when the attending shareholders do not represent a majority of the total number of issued shares, the chair may announce a postponement, provided that no more than two such postponements, for a combined total of no more than one hour, may be made. If the quorum is not met after two postponements, but the attending shareholders represent one third or more of the total number of issued shares, a tentative resolution may be adopted pursuant to Article 175, paragraph 1 of the Company Act; all shareholders shall be notified of the tentative resolution and another shareholders meeting shall be convened within one month.
<2> When, prior to conclusion of the meeting, the attending shareholders represent a majority of the total number of issued shares, the chair may resubmit the tentative resolution for a vote by the shareholders meeting pursuant to Article 174 of the Company Act.

Article 10. Decision on Agenda

<1> If a shareholders meeting is convened by the board of directors, the meeting agenda shall be set by the board of directors. The meeting shall proceed in the order set by the agenda, which may not be changed without a resolution of the shareholders meeting.
<2> The provisions of the preceding paragraph apply mutatis mutandis to a shareholders meeting convened by a party with the power to convene that is not the board of directors.
<3> The chair may not declare the meeting adjourned prior to completion of deliberation on the meeting agenda of the preceding two paragraphs (including extraordinary motions), except by a resolution of the shareholders meeting.
<4> After a shareholders’ meeting is adjourned, the shareholders may not adopt a resolution to elect another chair and resume the meeting at the same or another venue.

Article 11. Announcement of Recess

When a meeting is in progress, the chair may announce a break based on time considerations. If a force majeure event occurs, the chair may rule the meeting temporarily suspended and announce a time when, in view of the circumstances, the meeting will be resumed.

Article 12. Rules for Speaking

<1> Before speaking, an attending shareholder must specify on a speaker's slip the subject of the speech, his/her shareholder account number (or attendance card number), and account name. The order in which shareholders speak will be set by the chair.
<2> A shareholder in attendance who has submitted a speaker's slip but does not actually speak shall be deemed to have not spoken. When the content of the speech does not correspond to the subject given on the speaker's slip, the spoken content shall prevail.
<3> When an attending shareholder is speaking, other shareholders may not speak or interrupt unless they have sought and obtained the consent of the chair and the shareholder that has the floor; the chair shall stop any violation.

Article 13. Rules for Agenda

Discussion of proposals shall be made in order as set forth in agenda. If the shareholder's speech violates the rules or exceeds the scope of the agenda item, the chair may terminate the speech.

Article 14. Limitations to Speeches

<1> Except with the consent of the chair, a shareholder may not speak more than twice on the same proposal, and a single speech may not exceed 5 minutes.
<2> When a juristic person is appointed to attend as proxy, it may designate only one person to represent it in the meeting.
<3> When a juristic person shareholder appoints two or more representatives to attend a shareholders meeting, only one of the representatives so appointed may speak on the same proposal.

Article 15. Response to Speeches

After an attending shareholder has spoken, the chair may respond in person or direct relevant personnel to respond.

Article 16. Privilege of Chair

The chair shall announce a conclusion for discussion of proposals, announce the discussion closed when necessary, and call for a vote immediately.

Article 17. Rules for Voting Rights of Proposals

<1> Except as otherwise provided in the Company Act and in The Company's Articles of Incorporation, the passage of a proposal shall require an affirmative vote of a majority of the voting rights represented by the attending shareholders. At the time of a vote, for each proposal, the chair or a person designated by the chair shall first announce the total number of voting rights represented by the attending shareholders, followed by a poll of the shareholders. After the conclusion of the meeting, on the same day it is held, the results for each proposal, based on the numbers of votes for and against and the number of abstentions, shall be entered into the MOPS.
<2> When there is an amendment or an alternative to a proposal, the chair shall present the amended or alternative proposal together with the original proposal and decide the order in which they will be put to a vote. When any one among them is passed, the other proposals will then be deemed rejected, and no further voting shall be required.
<3> With the exception of a trust enterprise or a shareholder services agent approved by the competent securities authority, when one person is concurrently appointed as proxy by two or more shareholders, the voting rights represented by that proxy may not exceed three percent of the voting rights represented by the total number of issued shares. If that percentage is exceeded, the voting rights in excess of that percentage shall not be included in the calculation. When a shareholder is an interested party in relation to an agenda item, and there is the likelihood that such a relationship would prejudice the interests of this Corporation, that shareholder may not vote on that item, and may not exercise voting rights as proxy for any other shareholder.
<4> Vote monitoring and counting personnel for the voting on a proposal shall be appointed by the chair, provided that all monitoring personnel shall be shareholders of the Company. Immediately after vote counting has been completed, the results of the voting shall be announced on-site at the meeting, and a record made of the vote.
<5> A shareholder shall be entitled to one vote for each share held, except when the shares are restricted shares or are deemed non-voting shares under Article 179, paragraph 2 of the Company Act.

Article 18. Maintenance of Meeting Order

The chair may direct the proctors or security personnel to help maintain order at the meeting place. When proctors or security personnel help maintain order at the meeting place, they shall wear an identification card or armband bearing the word "Proctor."

Article 19. Unspecified Matters

Matters not attended herein shall be conducted in accordance with the Company act and other relevant laws and regulations.

Article 20. Enforcement and Amendments

These Rules shall take effect after having been submitted to and approved by a shareholders meeting. Subsequent amendments thereto shall be effected in the same manner.

Article 21. Amendment Dates

There Rules are signed on and agreed to on April 4, 1990; 1[st] Amendment was made on April 29, 1993; 2[nd] Amendment was made on April 10, 1998; 3[rd] Amendment was made on June 28, 2002; 4[th] Amendment was made on June 24, 2014; 5[th] Amendment was made on June 21, 2018.

Appendix 4

Long Bon International Co., Ltd. Shareholding by Directors and Supervisors

(1) The Company’s paid-in capital is NTD 3,947,292,780, with a total of 394,729,278 shares issued.
(2) The minimum statutory number of shares held and statement of number of shares held as stated on shareholders’ register is as follows:

Role	Statutory Number of Shares Held	Shares Held
Director	15,789,171 Shares	95,738,420 Shares

(3) Statement for Shareholding of Directors and Supervisors

Role	Name	Number of Shares Held
Director	FORTUNE BASE DEVELOPMENT CORP. LTD. Representative: Liu, Wei-Long	51,666,340 Shares
Director	GLOBAL FUNERAL SERVICES CO., LTD. Representative: Liu, Huang-Ji	44,072,080 Shares
Director	FORTUNE BASE DEVELOPMENT CORP. LTD. Representative: Chang, Zheng-Yue	51,666,340 Shares
Director	GLOBAL FUNERAL SERVICES CO., LTD. Representative: Shao, Ming-Bing	44,072,080 Shares
Independent Director	Yang, Gui-Hsiung	0 Shares
Independent Director	Ning, Guo-Hui	0 Shares
Independent Director	Chang, Cheng-Zhong	0 Shares
Total		95,738,420 Shares

Note: Book Closure Date: May 2, 2021.

AI assistant

LONG BON — AGM Information 2021

52135_rns_2021-09-08_aaa98c8e-20fd-4dc7-a957-3bb48af42562.pdf

Long Bon International CO., LTD.

2021 ANNUAL SHAREHOLDERS’ MEETING

MEETING AGENDA

Table of Contents

Meeting Agenda

Attachments

Appendix

Long Bon International Co., Ltd.

2021 General Shareholders’ Meeting Agenda

I. Announcing Meeting in Session

II. Welcome Speech by the Chairman

III. Reported Matters

IV. Acknowledged Matters

V. Matters for Discussion

VI. Extraordinary Motions:

VII. Adjournment

Business Report Attachment 1

1. 2020 Business Results

2. Overview for 2021 Business Plans

(1) 2021 Management Guidelines

1. Business of Asset Office

(1) Property Sale Plans

(2) Rental Plans

Table for 2021 Rent Revenue Forecasts by Properties

3. Future Company Development Strategies

IV. Impacts and Countermeasures under Macroeconomy, Policies and Regulations, and Market Supply and Demand Circumstances

(1) Macroeconomy

(2) Policies and Regulations

(4) Conclusion and Countermeasures

Audit Committee Review Report Attachment 2

Independent Auditors ’ Report

Opinion

Basis for Opinion

Key Audit Matters

Description of the key audit matter

How the matter was addressed in our audit

Description of the key audit matter

How the matter was addressed in our audit

3. Revenue Recognition of Construction Contract

Description of the 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

Auditors ’ Responsibilities for the Audit of the Consolidated Financial Statements

KPMG

Notes to Readers

LONG BON INTERNATIONAL CO., LTD. AND SUBSIDIARIES

Consolidated Balance Sheets

December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

LONG BON INTERNATIONAL CO., LTD. AND SUBSIDIARIES

Consolidated Balance Sheets (CONT’D)

December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

(English Translation of Consolidated Financial Statements Originally Issued in Chinese)

LONG BON INTERNATIONAL CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

For the Years Ended December 31, 2020 and 2019

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

(English Translation of Consolidated Financial Statements Originally Issued in Chinese)

LONG BON INTERNATIONAL CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Changes in Equity For the Years Ended December 31, 2020 and 2019 (Expressed in Thousands of New Taiwan Dollars)

LONG BON INTERNATIONAL CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the Years Ended December 31, 2020 and 2019 (Expressed in Thousands of New Taiwan Dollars)

Parent Company Only Financial Statements For the Year Ended December 31, 2020

Independent Auditors ’ Report

Opinion

Basis for Opinion

Key Audit Matters

Description of the key audit matter

How the matter was addressed in our audit

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

Auditors ’ Responsibilities for the Audit of the Parent Company Only Financial Statements

KPMG

Notes to Readers

LONG BON INTERNATIONAL CO., LTD.

LONG BON AGM Information 2021