LOOP - Proxy Solicitation & Information Statement 2023


Stock Code: 3025

Loop Telecommunication International, Inc.

2023 Annual Shareholders’ Meeting

Handbook

Date: June 28, 2023

Venue: No.2, Prosperity Rd. 1, Hsinchu Science Park

(Meeting Room 201, the Allied Association for Science Park Industries)

Table of Contents

One. Meeting Procedure 2

Two. Meeting Agenda 3

I. Report 4

II. Ratification 4

III. Discussion 6

IV. Extempore Motion 7

V. Adjournment 7

Three. Attachment

I. 2022 Business Report 8

II. Audit Committee’s Review Report 11

III. 2022 Auditor’s Report and Consolidated Financial Statements 12

IV. 2022 Auditor’s Report and Parent Company Only Financial Statements 23

V. Table of Earning Distribution 34

VI. Comparison Table of the “Articles of Incorporation” of the Company 35

Four. Appendix

I. Articles of Incorporation 38

II. Rules of Procedure for Shareholders’ Meetings 44

III. Effect of stock grants on business performance, earnings per share of the Company, and return on investments 47

IV. Shareholding of Directors 48

Loop Telecommunication International, Inc.

Procedures for the 2023 Regular Shareholders’ Meeting

Call the meeting to order
Chairperson’s speech
Report
Ratification
Discussion
Extempore motions
Adjournment

Loop Telecommunication International, Inc.

Agenda of the 2023 Regular Shareholders’ Meeting

Time: 9:00 a.m. on June 28, 2023 (Wednesday)

Venue: No.2, Prosperity Rd. 1, Hsinchu Science Park (Meeting Room 201, the Allied Association for Science Park Industries)

One. Call the meeting to order

Two. Chairperson’s speech

Three. Report

I. The 2022 business report of the Company.

II. The 2022 Audit Committee’s review report of the Company.

III. Report on the distribution of remunerations of employees and Directors of the Company for 2022.

Four. Ratification

I. The 2022 business report, consolidated financial statements, and parent company only financial statements of the Company.

II. The proposal for earning distribution of the Company for 2022.

Five. Discussion.

I. The proposal for cash distribution from the capital reserve of the Company.

II. The proposal for the amendment to the “Articles of Incorporation" of the Company.

III. The proposal for the capital reduction in cash of the Company.

Six. Extempore motion

Seven. Adjournment

Report

I. The 2022 business report of the Company is proposed for examination.

Description: The 2022 business report of the Company. Please refer to page 8 (Attachment 1) of the Handbook.

II. The 2022 Audit Committee’s review report of the Company is proposed for examination.

Description: For the Audit Committee’s review report, Please refer to page 11 (Attachment 2) of the Handbook.

III. Report on the distribution of remunerations of employees and Directors of the Company for 2022 is proposed for examination.

Description: The Company recorded earnings in 2022. According to the requirements under Article 29 of the Articles of Incorporation, the Company shall appropriate no less than 10% and no more than 5% of the net profit of the period before deducting remuneration of employees and remuneration of Directors as the remuneration of employees and remuneration of Directors, respectively; however, if the Company has cumulative losses (including adjusted undistributed earnings), it shall preserve the compensation amount. The Company intends to appropriate 2% as the remuneration of Directors and 10% as the remuneration of employees in the amount of NT$1,895,535 and NT$9,477,674, respectively, fully distributed in cash.

Ratification

Proposal 1: (proposed by the Board)

Subject: The 2022 business report, consolidated financial statements, and parent company only financial statements of the Company.

Description: (1) The 2022 business report, consolidated financial statements, and parent company only financial statements of the Company have been prepared, and CPAs Huang Yu-Feng and Tseng Jian-Ming from Deloitte & Touche Taiwan have audited the abovementioned financial statements and issued an auditor’s report with an unqualified opinion. The Audit Committee have completed the review of the abovementioned financial statements and the business report and submitted them to the Board, and the Board has approved them after discussions.

(2) For the 2022 business report, auditor’s report, and the abovementioned financial statements, please refer to page 8 (Attachment 1) and pages 12 to 33 (Attachments 3 and 4) of the Handbook.

(3) Proposed for ratification.

Resolution:

Proposal 2: (proposed by the Board)

Subject: The proposal for earning distribution of the Company for 2022.

Description: (1) For the 2022 Table of Earning Distribution of the Company, please refer to page 34 (Attachment 5) of the Handbook.

(2) The proposal for earning distribution for 2022 intends to distribute cash dividends of NT$0.94 per share (totaling NT$66,665,317); the distribution of cash dividends is calculated pro rata in the unit of NT$1, with any amount below NT$1 rounded off, and any balance below NT$1 is included in other income of the Company. After the annual shareholders’ meeting approves the resolution, the Board is authorized for relevant ex-dividend data and distribution matters at full discretion.

(3) Subsequently, if the payout rate changes due to the effects on the number of outstanding shares resulting from the repurchase of the Company’s shares, transfer of treasury shares, or a capital increase in cash, the Company intends to propose to the annual shareholders’ meeting to authorize the Chairman for full discretion.

(4) Proposed for ratification.

Resolution:

Three. Discussion

Proposal 1: (proposed by the Board)

Subject: The proposal for cash distribution from the capital reserve of the Company.

Description: (1) According to the requirements under Article 241 of the Company Act, the Company intends to distribute cash dividends from the capital reserve arising from the premium of the issuance of ordinary shares at a price exceeding the par value in the amount of NT$4,255,233, with a distribution of NT$0.06 per share.

(2) Based on the shareholding recorded in the shareholders’ register on the base date of the cash distribution from the capital reserve, the amount distributed to shareholders is calculated in the unit of NT$1 (with any amount below NT$1 rounded off), and any balance below NT$1 is included in other income of the Company.

(3) Combining the cash distribution from the capital reserve of NT$0.06 per share under the proposal with the dividends distribution from earnings of the year of NT$0.94 per share, the Company distribute NT$1 per share in cash for the year in total.

(4) Proposed for discussion.

Resolution:

Proposal 2: (proposed by the Board)

Subject: The proposal for the amendment to the “Articles of Incorporation" of the Company.

Description: (1) To adjust the item code of the scope of business and the content of Articles, the Company intends to amend partial Articles of the “Articles of Incorporation” of the Company; the comparison table of Articles before and after the amendment is set out in Attachment 6.

(2) Proposed for discussion.

Resolution:

Proposal 3: (proposed by the Board)

Subject: The proposal for the capital reduction in cash of the Company.

Description: (1) Reason for the capital reduction in cash: To improve the return on investments of the Company, it intends to perform a capital reduction in cash and return the payments for shares to shareholders.

(2) Ratio of capital reduction in cash and amount:

At present, the paid-in capital of the Company is NT$709,205,500. The Company intends to perform a capital reduction in cash in the amount of NT$141,841,100, with 14,184,110 shares involved in the capital reduction. After the capital reduction, the total number of shares will become 56,736,440 shares, with a capital reduction ratio of 20%; a refund of NT$2 per share will be made to shareholders with the calculation made in the unit of NT$1 (with any amount below NT$1 rounded off), and the share capital reduced will be returned to shareholders in cash based on their shareholding.
Calculated based on the number of shares held recorded in the shareholders’ register on the “date of the capital reduction and share conversion,” 800 shares will be issued for every 1,000 shares for each shareholder, and non-physical issuance will be adopted for the shares after the capital reduction.
For fractional shares after the capital reduction, shareholders may make the application for board lot registration with the Company’s stock affairs agency five days prior to the book closure date of the capital reduction and share conversion to one day prior to the book closure date. Subsequently, if there are remaining fractional shares, such shares are converted to cash payment to shareholders based on the par value of shares with the calculation made in the unit of NT$1 (with any amount below NT$1 rounded off); the Chairman is authorized to negotiate with particular persons to make subscriptions at par value for fractional shares.
After the proposal is approved by the Board and submitted to and approved by the 2023 shareholders’ meeting as a resolution, the Company will report to the competent authority for approval, and the shareholders authorize the Board to otherwise establish the date for the capital reduction and share conversion and other relevant operations. If the shareholders’ capital reduction ratio changes arising from effects on the number of issued shares due to the changes in laws and regulations, adjustments made by the competent authority, repurchase or cancelation of treasury shares of the Company, or other reasons that affect changes in shares, the shareholders’ meeting also authorizes the Chairman to make adjustments according to the law.

(3) Proposed for discussion.

Resolution:

Four. Extempore motion

Five. Adjournment

Attachment 1

Loop Telecommunication International, Inc.

2022 Business Report

In 2022, with uncertainties derived from the continuation of the war and geopolitics, there were material impacts on production capacity and operating income as the issues of lacking crucial parts and components, the delay in shipping schedule of different countries, lack of containers, and port congestion could not be solved effectively. Due to the US-China trade war and changes in the international environments, together with inflation, interest rate, and other macroeconomic factors, the communication industry was under effect; the growth recorded in the emerging market was not as expected, and the market turned to conservatism, affecting the operating income of the Company last year. Fortunately, Loop Telecommunication made appropriate responses and responded to the transformation of the industry pattern in advance, and our long-established brand was highly recognized. In recent years, we have promoted the use of MCC (Mission Critical Communication) in particular application fields, and there was a breakthrough reflected in our profit margin and overall performance. Facing the ever-changing market revolution, the Company will achieve the objective of low-cost and high performance through effective resource management and perform product transformation to become a contractor for value-added MCC solutions, which will have significant effects on the increase in subsequent operating income.

The consolidated revenue of the Company throughout the year was NT$438,242 thousand, representing a decrease of 15% from 2021; net income was NT$67,403 thousand, and earnings per share were NT$0.95. Profit margin of Loop Telecommunication has been maintained stably above 50%, which is a relatively outstanding performance in the network and communication industry. With the effects achieved through focusing on the market in Taiwan and the continual growth in different regions, Loop Telecommunication has adopted global sales and arrangements, and the regional ratio of the overall revenue will become more comprehensive. In addition, we maintained favorable performance in terms of financial structure, solvency, accounts receivable turnover, and other financial indicators.

Regarding our business, there were 52 countries having business dealings with the Company worldwide last year. Our export sales accounted for approximately 70% of the operating income throughout the year. In particular, we recorded growth in America, the EU, and Southeast Asia. For the market in Taiwan, the project has proceed to the next stage, and there has been a slight decrease for the Indian market. In terms of industry, electricity and governmental agencies account for 70% of our total revenue, and transportation and private corporate markets account for approximately 15%. In 2022, 80% of our operating income was from 13% of countries having dealings with us. Among all 32 product lines, 80% of the revenue was from 10% of the sales products. With the stabilization of the outbreak, it is likely to maintain the growth in the European and American region as in prior years, and the market in Southeast Asia also recovered. We continued to develop emerging markets to flexibly satisfy customers’ requirements. Loop Telecommunication has long been cooperating with large-scale international SI companies to develop new markets and promote the MCC market, which is deemed as the market driver under the trend of the new norms.

In 2013, Loop commenced its strategic transformation, strongly promoted mission-critical solutions, and successfully entered multiple domestic and foreign markets in recent years. As the bandwidth hungry applications in the mission-critical communication (MCC) network continued to increase, TDM-based network backbone is gradually replaced by Packet-based one. Facing the transition period from existing technologies to new technologies, the provision of the new generation packet transport network technologies and concurrently accessing the existing Legacy services have become the solutions most required by MCC users. Loop’s product line includes over 60 products, and it has been committed to the R&D of new products (i.e., G7860A, WDM1800, O9400-PTN10G, O9500-PTN10G, and other mixed service multiplexers for the abovementioned requirements. Meanwhile, it also upgraded the access service product line (AM3440-CCPB, IP6704A, and G7820) and developed Loop proprietary ultra-low latency and zero-packet-loss protection switching technologies to solve two major hindrances faced by MCC users in terms of the packet transport network. Combining the network management system with point-to-point circuit management capability.

The Loop-G7800 product line, the key development project of the Company for the year (2023), will be the highlight in the future. Loop-G7800 supports 100G optical transmission and possesses 400G exchange capacity, which significantly improves the backbone transmission bandwidth for customers. G7800 integrates Loop’s self-owned FPGA development capacity with various traditional TDM and the new generation L2/L2.5/L3 packet transport network technologies. Apart from being the backbone node, G7800 can also serve as the gateway for PDH/SDH/SONET/PTN network. The Nx64K nterface card used over the years for AM3440 and O9500 may be used on the G7800 system platform, and Loop has also developed over ten kinds of nterface cards for multiple speeds that support SDH/SONET/MPLS-TP/Carrier Ethernet. The comprehensive feature allows customers to have more flexibility for network planning in the future; regardless of phased budgeting projects increased based on requirements or the new era overall transmission network solutions that wish to be settled at one go, the Loop-G7800 product line will be able to satisfy such customers. At present, multiple partners have been actively inquiring about the formal launch of G7800. It is expected that the Loop-G7800 product line will become the next-generation star product to force into the MCC market.

Except for the major backbone and access network product series used worldwide, Loop has explored ISS, AI, corporate new era office network, corporate 5G private network, and other new technologies in recent years to expand into new markets of corporate and governmental information security network overall solution development. In recent years, due to frequent information security events, the requirements for information security of corporations and the government have been increasing. Loop has obtained the ISO27001 information security certification and performed a firmware upgrade for different products catering to the MCC market to support FIPS 140-3. Meanwhile, the Company also plans to launch the Loop-ISS2180 mission-critical network firewall and Loop-ISS2110 government configuration baseline network setting management system to assist customers in establishing the optimized MCC information security protection environment.

Looking into the year ahead, the Company will continue to launch the following products and services.

Primarily used in the MCC market
General access aggregation multiplexer
Cross connection and access multiplexer
SDH/SONET-MPLS mixed transmission equipment
L2/CE/L3/MPLS carrier grade packet-switching equipment
Solutions primarily used in the conversion from TDM transmission to packet switching transmission
TDM over Ethernet (TDMoE)
Solutions primarily used in exclusive MCC’s 5G for enterprises
MCC 5G-CPE and 5G CPE corporate core network service
Information security solutions primarily used in new-generation corporate offices
New era corporate LAN equipment
IIoT and video monitoring equipment
OT operating technology information security equipment

The MCC market is enormous, and it requires customized overall solutions. At present, many countries have initiated dedicated acts for infrastructure. For the strategies in the future market, Loop’s network transmission equipment and solutions are highly competitive, and it has become one of a few overall solution providers that can integrate optical communication, Ethernet transmission, multiprotocol label switching(MPLS) transmission, and dense wavelength division multiplexing(DWDM) worldwide with international partners and local system integration suppliers; it has successfully transformed into a communication and information system integration supplier and occupies a leading position in the MCC overall solution market. Next, the Company will expand its market development team and improve its income from vertical integration maintenance services. It will commit to becoming a one-stop MCC network solution provider and entering the global market through close cooperation with partners worldwide with continual growing momentum continues.

Regarding the marketing strategy for sharing the experience of the successful new backbone transmission case of Loop Telecommunication with the international society, it may develop new customers and spare no effort in creating critical new customer groups within three years; it is believed that the strategy will bring more orders and potential tenders for our layout. Combining the MCC networking product portfolio under the new business and the niche of various products, it is likely to become the growth focus for operations in the future. At present, Loop Telecommunication is one of the top three companies for MCC solutions around the world. Based on the existing foundation, the Company continues to reinforce its management and makes constant efforts by adhering to the philosophy of continuing to develop new products and explore new markets. In the future, the Company will become a leader, grasp business opportunities, create excellent performance, and continues to strive for the maximized operating performance for all shareholders.

Chairman: Yeh Maw-Lin

President: Yeh Maw-Lin

Chief Accountant: Chang Xiao-Ling

Attachment 2

Loop Telecommunication International, Inc.

Audit Committee’s Review Report

The Board has prepared the 2022 business report, financial statements (including consolidated financial statements), and the Table of Earning Distribution, in which Deloitte & Touche Taiwan, engaged by the Board, has audited the financial statements and issued an auditor’s report.

We have reviewed the abovementioned books and statements and consider that they comply with the requirements of the Company Act and relevant laws and regulations; therefore, we issue the review report as above according to the requirements under Article 219 of the Company Act.

Submitted for examination

The 2023 annual shareholders’ meeting of Loop Telecommunication International, Inc.

Convener of the Audit Committee: Ko Shu-Mei

March 28, 2023

Attachment 3

Independent Auditors’ Report Translated from Chinese

Shareholders and the Board of Directors of Loop Telecommunication International, Inc.,

Opinion

We have audited the accompanying consolidated balance sheet of Loop Telecommunication International, Inc. and its subsidiaries (the “Company”) as of December 31, 2022 and 2021, and the consolidated statement of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the consolidated financial statements (including a summary of significant accounting policies).

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2022 and 2021, 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 International Financial Reporting Standards (IFRS), International Accounting Standards (IAS), IFRIC Interpretations (IFRIC), and SIC Interpretations (SIC) endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

Basis for opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and the Standards on Auditing of the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Company in accordance with the Norm of Professional Ethics for Certified Public Accountants of the Republic of China and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of the most significance in our audit of the consolidated financial statements of theCompany for the year ended December 31, 2022. 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.

Key audit matters for the Company’s consolidated financial statements for the year ended December 31, 2022 is stated as follows:

Revenue sources

The major of the Company includes the production and sales of user remote line disconnectors, high-speed network access equipment, smart network resource management selectors, and other relevant products. As revenue has material effects on the 2022 consolidated financial statements of Loop Telecommunication International, Inc., revenue recognition involves manual control operations, and there are risks related to sales counterparties and the authenticity of transactions due to the significant growth in the revenue from partial customers, we have identified the revenue recognition as a key audit matter. For the accounting policies of revenue recognition, please refer to Note 4.(12) to the consolidated financial statements.
In response to the abovementioned risks, we have performed the following audit procedures:

(1) Understand and test the internal control systems and procedures related to the cycle of sales transactions to identify and evaluate the effectiveness of the internal control procedures involved in making sales transactions.

(2) Sample whether internal orders are approved by the responsible supervisor.

(3) Sample whether external orders and transportation documents have been obtained for revenue recognition and whether the amount and the invoiced amount are consistent.

(4) Sample whether the amount of collection after the period for relevant sales income transactions, remittance certificates, and counterparties is consistent with the amount of revenue recognition and counterparties.

Other matters

We have also audited the parent company only financial statements of Loop Telecommunication International, Inc. as of and for the years ended December 31, 2022 and 2021 on which we have issued an unmodified opinion.

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

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

In preparing the consolidated financial statements, management is responsible for assessing the Company 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 members of the Audit Committee, are responsible for overseeing the Company financial reporting process.

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

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an 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 Standards on Auditing of the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

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

Identify and assess the risks of material misstatement of the consolidated financial statements ,whether due to fraud or error, design and perform audit procedures responsive to those risks and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the 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 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 Company 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 Company 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~~s~~ 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 determined those matters that were of most significance in the audit of the consolidated financial statements for the year ended December 31, 2022 and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Deloitte & Touche Taiwan


Accountant Huang Yu-Feng	Accountant Tseng Jian-Ming


Approval No. of the Securities and Futures Bureau Tai-Cai-Zheng-Liu-Zi No.0920123784	Approval No. of the Financial SupervisionCommission 　Jin-Guan-Shen-Zheng-Zi No.1100356048

March 28, 2023

Notice to Readers

The accompanying consolidated financial statements are intended only to present the consolidated financial position, financial performance and cash flows in accordance with accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to review such consolidated financial statements are those generally applied in the Republic of China.

For the convenience of readers, the independent auditors’ review report and the accompanying consolidated financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China.If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, the Chinese-language independent auditors’ review report and consolidated financial

statements shall prevail.

Loop Telecommunication International, Inc. and its subsidiaries

Consolidated Balance Sheet

December 31, 2022 and 2021

(In Thousands of New Taiwan Dollars)


	December 31, 2022		December 31, 2021
Assets	Amount	％	Amount	％
Current assets
Cash and cash equivalents (Notes 4 and 6)	$ 361,283	34	$ 119,623	12
Financial assets at fair value through profit or loss - current (Notes 4 and 7)	33,546	3	321	-
Financial assets at amortized cost - current (Notes 4 and 8)	15,773	1	14,120	2
Contract assets - current (Notes 4 and 21)	32,776	3	148,875	15
Net accounts receivable (Notes 4, 5, 9, and 21)	41,771	4	130,098	13
Other receivables (Notes 4 and 9)	1,150	-	1,170	-
Inventories (Notes 4, 5, and 10)	312,977	29	295,902	30
Other current assets (Note 16)	2,934	-	11,310	1
Total current assets	802,210	74	721,419	73

Non-current assets
Financial assets at amortized cost - non-current (Notes 4, 8, and 28)	12,026	1	12,018	1
Property, plant and equipment (Notes 4, 12, and 28)	146,206	14	155,782	16
Right-of-use assets (Notes 4, 5 and 13)	42,591	4	43,894	4
Investment property (Notes 4, 14, and 28)	31,858	3	32,968	3
Intangible assets (Notes 4 and 15)	8,638	1	5,499	1
Deferred income tax assets (Notes 4 and 23)	5,713	-	6,698	1
Refundable deposits (Note 28)	30,212	3	14,045	1
Total non-current assets	277,244	26	270,904	27

Total assets	$ 1,079,454	100	$ 992,323	100

Financial liabilities and equity
Current liabilities
Contract liabilities - current (Notes 4 and 21)	$ 3,002	-	$ 1,112	-
Accounts payable	29,638	3	45,443	5
Other payables (Note 18)	59,150	5	47,269	5
Income tax payable (Notes 4 and 23)	9,235	1	7,042	1
Lease liabilities - current (Notes 4 and 13)	1,159	-	2,327	-
Long-term liabilities - current portion (Notes 4, 17, and 28)	1,936	-	2,289	-
Other current liabilities (Note 18)	30,462	3	1,225	-
Total current liabilities	134,582	12	106,707	11

Non-current liabilities
Long-term borrowings (Notes 4, 17, and 28)	-	-	1,936	-
Deferred income tax liabilities (Notes 4 and 23)	3,455	-	-	-
Lease liabilities - non-current (Notes 4 and 13)	48,109	5	48,000	5
Net defined benefit liabilities - non-current (Notes 4 and 19)	16,731	2	28,148	3
Guarantee deposits	1,190	-	1,273	-
Non-current liabilities (Note 18)	23,304	2	-	-
Total non-current liabilities	92,789	9	79,357	8

Total liabilities	227,371	21	186,064	19

Equity (Note 20)
Common stock	709,206	66	709,206	71
Capital surplus	48,208	4	48,208	5
Retained earnings
Legal reserve	19,174	2	16,008	2
Special reserve	3,088	-	3,005	-
Unappropriated earnings	75,193	7	32,920	3
Total retained earnings	97,455	9	51,933	5
Other equity	( 2,786 )	-	( 3,088 )	-

Total equity	852,083	79	806,259	81

Total Liabilities and Equity	$ 1,079,454	100	$ 992,323	100

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

Loop Telecommunication International, Inc. and its subsidiaries

Consolidated Statement of Comprehensive Income

For the years ended December 31, 2022 and 2021

(In Thousands of New Taiwan Dollars, Except Earnings Per Share)


	2022		2021
	Amount	％	Amount	％
Net revenue (Notes 4, 21, and 32)	$ 438,242	100	$ 515,510	100

Cost of revenue (Notes 4, 10, and 22)	197,678	45	249,191	48

Gross profit	240,564	55	266,319	52

Operating expenses (Note 22)
Sales and marketing expenses	44,881	10	44,676	9
General and administrative expenses	46,459	11	40,915	8
Research and development expenses	134,715	31	140,729	27
Subtotal	226,055	52	226,320	44

Income from operations	14,509	3	39,999	8

Non-operating income and expenses (Note 22)
Interest income	4,029	1	196	-
Other income	36,119	8	4,648	1
Other gains and losses	29,994	7	( 3,661 )	( 1 )
Finance costs	( 1,248 )	-	( 1,337 )	-
Total non-operating income and expenses	68,894	16	( 154 )	-

Income before income tax	83,403	19	39,845	8

Income tax expenses (Notes 4 and 23)	16,000	4	6,819	2

Net income	67,403	15	33,026	6

(Cont’d)


	2022		2021
	Amount	％	Amount	％
Other comprehensive income (Notes 4, 19, and 20)
Items that will not be reclassified subsequently to profit or loss:
Remeasurements of defined benefit obligation	$ 6,487	2	( $ 1,361 )	-
Items that may be reclassified subsequently to profit or loss
Exchange differences arising on translation of foreign operations	302	-	( 83 )	-
Other comprehensive income, net of income tax	6,789	2	( 1,444 )	-

Total comprehensive income	$ 74,192	17	$ 31,582	6

Earnings per share (Note 24)
Basic	$ 0.95		$ 0.47
Diluted	$ 0.94		$ 0.46

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

Loop Telecommunication International, Inc. and its subsidiaries

Consolidated Statement of Changes in Equity

For the years ended December 31, 2022 and 2021

(In Thousands of New Taiwan Dollars; unless specified otherwise)


							Other Equity
							Exchange differences arising on translation of foreign operations
	Capital stock			Retained earnings
	Shares (1,000 shares)	Amount	Capital surplus	Legal reserve	Special reserve	Unappropriated earnings		Total equity
Balance on January 1, 2021	70,921	$ 709,206	$ 49,626	$ 8,283	$ 2,900	$ 78,588	( $ 3,005 )		$ 845,598

Earnings distribution and appropriation in 2020
Legal reserve	-	-	-	7,725	-	( 7,725 )	-		-
Special reserve	-	-	-	-	105	( 105 )	-		-
Cash dividends of shareholders	-	-	-	-	-	( 69,503 )	-		( 69,503 )

Cash distribution from the capital reserve	-	-	( 1,418 )	-	-	-	-		( 1,418 )

Net incomein 2021	-	-	-	-	-	33,026	-		33,026

Other comprehensive income, net of income tax in 2021	-	-	-	-	-	( 1,361 )	( 83 )		( 1,444 )

Total comprehensive income in 2021	-	-	-	-	-	31,665	( 83 )		31,582

Balance of December 31, 2021	70,921	709,206	48,208	16,008	3,005	32,920	( 3,088 )		806,259

Earnings distribution and appropriation in 2021
Legal reserve	-	-	-	3,166	-	( 3,166 )	-		-
Special reserve	-	-	-	-	83	( 83 )	-		-
Cash dividends of shareholders	-	-	-	-	-	( 28,368 )	-		( 28,368 )

Net incomein 2022	-	-	-	-	-	67,403	-		67,403

Other comprehensive income, net of income tax in 2022	-	-	-	-	-	6,487	302		6,789

Total comprehensive income in 2022	-	-	-	-	-	73,890	302		74,192

Balance of December 31, 2022	70,921	$ 709,206	$ 48,208	$ 19,174	$ 3,088	$ 75,193	( $ 2,786 )		$ 852,083

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

Loop Telecommunication International, Inc. and its subsidiaries

Consolidated Statement of Cash Flows

For the years ended December 31, 2022 and 2021

(In Thousands of New Taiwan Dollars)


	2022	2021
Cash flows from operating activities
Income before income tax	$ 83,403	$ 39,845
Item of profit or loss:
Depreciation expense	15,419	16,297
Amortization expense	3,658	2,414
Losses (gains) on financial assets and liabilities at fair value through profit or loss	508	( 100 )
Finance costs	1,248	1,337
Interest income	( 4,029 )	( 196 )
Dividend income	( 43 )	( 5 )
Losses of inventory write-down or obsolescence	3,876	-
Net gains on foreign exchange	( 25,165 )	( 165 )
Changes in operating assets and liabilities
Contract assets	116,099	( 48,181 )
Accounts receivables	88,855	114,572
Other receivables	869	( 678 )
Inventories	( 20,951 )	( 3,702 )
Other current assets	8,376	19,761
Contract liabilities	1,890	( 1,162 )
Accounts payable	( 15,098 )	( 9,217 )
Other payables	12,063	( 16,017 )
Other current liabilities	29,237	607
Net defined benefit liability	( 4,930 )	( 2,787 )
Other non-current liabilities	23,304	-
Cash from operations	318,589	112,623
Interest paid	( 1,248 )	( 1,337 )
Income tax paid	( 9,367 )	( 14,714 )
Net cash generated by operating activities	307,974	96,572

(Cont’d)


	2022	2021
Cash flows from investing activities
Acquisition of financial assets at amortized cost	( $ 335,426 )	( $ 40,989 )
Disposal of financial assets at amortized cost	333,765	46,861
Acquisition of financial assets at fair value through profit or loss	( 33,733 )	( 70,000 )
Disposal of financial assets at fair value through profit or loss	-	70,084
Acquisition of property, plant and equipment	( 2,267 )	( 3,978 )
Refundable deposits (paid) refunded	( 16,167 )	790
Acquisition of intangible assets	( 6,797 )	( 5,841 )
Interest received	3,180	220
Dividends received	43	5
Net cash used in investing activities	( 57,402 )	( 2,848 )

Cash flows from financing activities
Repayment of long-term debt	( 2,289 )	( 2,254 )
Guarantee deposits refunded	( 83 )	( 472 )
Repayment for the principal of lease liabilities	( 2,308 )	( 2,280 )
Cash dividends paid	( 28,368 )	( 70,921 )
Net cash used in financing activities	( 33,048 )	( 75,927 )

Effect of exchange rate changes on cash and cash equivalents	24,136	236

Net increase in cash and cash equivalents during the year	241,660	18,033

Cash and cash equivalents, beginning of year	119,623	101,590

Cash and cash equivalents, end of year	$ 361,283	$ 119,623

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

Attachment 4

Independent Auditors’ Report Translated from Chinese

Shareholders and the Board of Directors of Loop Telecommunication International, Inc.,

Opinion

We have audited the accompanying parent company only balance sheet of Loop Telecommunication International, Inc. (the “Company”) as of December 31, 2022 and 2021, and the parent company only statements of comprehensive income changes in equity and cash flows for the years then ended, and notes to the parent company only financial statements (including a summary of significant accounting policies).

In our opinion, the accompanying parent company only financial statements present fairly, in all material respects, the accompanying parent company only financial position of the Company as of December 31, 2022 and 2021, and its parent company only financial performance and its parent company only 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 audits in accordance with the Regulations Governing Auditing andAttestation of Financial Statements by Certified Public Accountants and the Standards on Auditing of the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the parent company only Financial Statements section of our report. We comply with the Norm of Professional Ethics for Certified Public Accountants of the Republic of China and independent of the Company We have also fulfilled our other ethical responsibilities in accordance with these requirements.We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the parent company only financial statements of the Company for the year ended December 31, 2022. 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.

Key audit matters for the Company’s parent company only financial statements for the year ended December 31, 2022 is stated as follows:

Revenue recognition

The major revenue sources of Company includes the production and sales of user remote line disconnectors, high-speed network access equipment, smart network resource management selectors, and other relevant products. As revenue has material effects on the 2022 parent company only financial statements of Loop Telecommunication International, Inc., revenue recognition involves manual control operations, and there are risks related to sales counterparties and the authenticity of transactions due to the significant growth in the revenue from partial customers, we have identified the revenue recognition as a key audit matter. For the accounting policies of revenue recognition, please refer to Note 4.(12) to the parent company only financial statements.
In response to the abovementioned risks, we have performed the following audit procedures:

(2) Sample whether internal orders are approved by the responsible supervisor.

(3) Sample whether external orders and transportation documents have been obtained for revenue recognition and whether the amount and the invoiced amount are consistent.

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

Management is responsible for the preparation and fair presentation of the parent company only financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and 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 members of 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 Standards on Auditing of the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate; they could reasonably be expected to influence the economic decisions of users taken on the basis of the parent company only financial statements.

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

Identify and assess the risks of material misstatement of the parent company only financial statements ,whether due to fraud or error, design and perform audit procedures responsive to those risks and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the 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 entities or business activities within the Company to express an opinions on the parent company only 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 relevantethical 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 parent company only financial statements for the year ended December 31, 2022 and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Deloitte & Touche Taiwan

Acountant Huang Yu-Feng Acountant Tseng Jian-Ming


Approval No. of the Securities and Futures Bureau Tai-Cai-Zheng-Liu-Zi No.0920123784		Approval No. of the Financial Supervision Commission 　Jin-Guan-Shen-Zheng-Zi No.1100356048

March 28, 2023

Notice to Readers

Loop Telecommunication International, Inc.

Parent Company Only Balance Sheet

December 31, 2022 and 2021

(In Thousands of New Taiwan Dollars)


	December 31, 2022		December 31, 2021
Assets	Amount	％	Amount	％
Current assets
Cash and cash equivalents (Notes 4 and 6)	$ 355,599	33	$ 112,993	12
Financial assets at fair value through profit or loss - current (Notes 4 and 7)	33,546	3	321	-
Financial assets at amortized cost - current (Notes 4 and 8)	15,773	2	14,120	2
Contract assets - current (Notes 4 and 21)	32,776	3	148,875	15
Net accounts receivable (Notes 4, 5, 9, and 21)	41,771	4	129,573	13
Accounts receivable - related party (Notes 4, 5, 9, and 21)	201	-	58	-
Other receivables (Notes 4 and 9)	886	-	981	-
Other receivables - related party (Notes 4 and 27)	-	-	1,105	-
Inventories (Notes 4, 5, and 10)	310,379	29	295,512	30
Other current assets (Notes 16 and 27)	7,541	1	11,664	1
Total current assets	798,472	75	715,202	73

Non-current assets
Financial assets at amortized cost - non-current (Notes 4, 8, and 28)	12,026	1	12,018	1
Investments accounted for using equity method (Notes 4 and 11)	1,145	-	3,206	-
Property, plant and equipment (Notes 4, 12, and 28)	142,313	13	151,301	15
Right-of-use assets (Notes 4 and 13)	40,543	4	41,830	4
Investment property (Notes 4, 14, and 28)	31,858	3	32,968	3
Intangible assets (Notes 4 and 15)	8,638	1	5,499	1
Deferred income tax assets (Notes 4 and 23)	5,713	-	6,698	1
Refundable deposits (Note 28)	30,212	3	14,045	2
Total non-current assets	272,448	25	267,565	27

Total assets	$ 1,070,920	100	$ 982,767	100

Financial liabilities and equity
Current liabilities
Contract liabilities - current (Notes 4 and 21)	$ 3,002	-	$ 1,112	-
Accounts payable	29,581	3	44,897	5
Accounts payable - related party (Note 27)	1,775	-	597	-
Other payables (Note 18)	49,032	5	38,247	4
Income tax payable (Notes 4 and 23)	9,235	1	7,042	1
Lease liabilities - current (Notes 4 and 13)	1,159	-	2,327	-
Long-term liabilities - current portion (Notes 4, 17, and 28)	1,936	-	2,289	-
Other current liabilities (Note 18)	30,328	3	640	-
Total current liabilities	126,048	12	97,151	10

Non-current liabilities
Long-term borrowings (Notes 4, 17, and 28)	-	-	1,936	-
Deferred income tax liabilities (Notes 4 and 23)	3,455	-	-	-
Lease liabilities - non-current (Notes 4 and 13)	48,109	4	48,000	5
Net defined benefit liabilities - non-current (Notes 4 and 19)	16,731	2	28,148	3
Guarantee deposits	1,190	-	1,273	-
Other non-current liabilities (Note 18)	23,304	2	-	-
Total non-current liabilities	92,789	8	79,357	8

Total liabilities	218,837	20	176,508	18

Equity (Note 20)
Common stock	709,206	66	709,206	72
Capital surplus	48,208	5	48,208	5
Retained earnings
Legal reserve	19,174	2	16,008	2
Special reserve	3,088	-	3,005	-
Unappropriated earnings	75,193	7	32,920	3
Total retained earnings	97,455	9	51,933	5
Other equity	( 2,786 )	-	( 3,088 )	-

Total equity	852,083	80	806,259	82

Total Liabilities and Equity	$ 1,070,920	100	$ 982,767	100

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

Loop Telecommunication International, Inc.

Parent Company Only Statement of Comprehensive Income

For the years ended December 31, 2022 and 2021

(In Thousands of New Taiwan Dollars, Except Earnings Per Share)


	2022		2021
	Amount	％	Amount	％
Net revenue (Notes 4, 21, and 27)	$ 438,234	100	$ 515,380	100

Cost of revenue (Notes 4, 10, 22, and 27)	202,874	46	249,722	49

Gross profit	235,360	54	265,658	51

Unrealized gross profit on sales with subsidiaries (Note 4)	( 978 )	-	( 3 )	-

Realized gross profit	236,338	54	265,661	51

Operating expenses (Note 22)
Sales and marketing expenses	44,264	10	43,756	8
General and administrative expenses	40,509	9	39,433	8
Research and development expenses	134,715	31	140,729	27
Subtotal	219,488	50	223,918	43

Income from operations	16,850	4	41,743	8

Non-operating income and expenses (Note 22)
Interest income	4,016	1	185	-
Other income	35,576	8	4,621	1
Other gains and losses	31,530	7	( 3,647 )	( 1 )
Finance costs	( 1,228 )	-	( 1,308 )	-
Share of losses of subsidiaries accounted for using equity method (Note 4)	( 3,341 )	( 1 )	( 1,749 )	-
Total non-operating income and expenses	66,553	15	( 1,898 )	-

(Cont’d)


	2022		2021
	Amount	％	Amount	％
Income before income tax	$ 83,403	19	$ 39,845	8

Income tax expenses (Notes 4 and 23)	16,000	4	6,819	2

Net income	67,403	15	33,026	6

Other comprehensive income (Notes 4, 19, and 20)
Items that will not be reclassified subsequently to profit or loss:
Remeasurements of defined benefit obligation	6,487	2	( 1,361 )	-
Items that may be reclassified subsequently to profit or loss
Exchange differences arising on translation of foreign operations	302	-	( 83 )	-
Other comprehensive income, net of income tax	6,789	2	( 1,444 )	-

Total comprehensive income	$ 74,192	17	$ 31,582	6

Earnings per share (Note 24)
Basic	$ 0.95		$ 0.47
Diluted	$ 0.94		$ 0.46

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

Loop Telecommunication International, Inc.

Parent Company Only Statement of Changes in Equity

For the years ended December 31, 2022 and 2021

(In Thousands of New Taiwan Dollars; unless specified otherwise)


							Other Equity
							Exchange differences arising on translation of foreign operations
	Capital stock			Retained earnings
	Shares (1,000 shares)	Amount	Capital surplus	Legal reserve	Special reserve	Unappropriated earnings		Total equity
Balance on January 1, 2021	70,921	$ 709,206	$ 49,626	$ 8,283	$ 2,900	$ 78,588	( $ 3,005 )		$ 845,598

Earnings distribution and appropriation in 2020
Legal reserve	-	-	-	7,725	-	( 7,725 )	-		-
Special reserve	-	-	-	-	105	( 105 )	-		-
Cash dividends of shareholders	-	-	-	-	-	( 69,503 )	-		( 69,503 )

Cash distribution from the capital reserve	-	-	( 1,418 )	-	-	-	-		( 1,418 )

Net incomein 2021	-	-	-	-	-	33,026	-		33,026

Other comprehensive income, net of income tax in 2021	-	-	-	-	-	( 1,361 )	( 83 )		( 1,444 )

Total comprehensive income in 2021	-	-	-	-	-	31,665	( 83 )		31,582

Balance of December 31, 2021	70,921	709,206	48,208	16,008	3,005	32,920	( 3,088 )		806,259

Earnings distribution and appropriation in 2021
Legal reserve	-	-	-	3,166	-	( 3,166 )	-		-
Special reserve	-	-	-	-	83	( 83 )	-		-
Cash dividends of shareholders	-	-	-	-	-	( 28,368 )	-		( 28,368 )

Net incomein 2022	-	-	-	-	-	67,403	-		67,403

Other comprehensive income, net of income tax in 2022	-	-	-	-	-	6,487	302		6,789

Total comprehensive income in 2022	-	-	-	-	-	73,890	302		74,192

Balance of December 31, 2022	70,921	$ 709,206	$ 48,208	$ 19,174	$ 3,088	$ 75,193	( $ 2,786 )		$ 852,083

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

Loop Telecommunication International, Inc.

Parent Company Only Statement of Cash Flows

For the years ended December 31, 2022 and 2021

(In Thousands of New Taiwan Dollars)


	2022	2021
Cash flows from operating activities
Income before income tax	$ 83,403	$ 39,845
Item of profit or loss:
Depreciation expense	14,688	15,510
Amortization expense	3,658	2,414
Net losses (gains) on financial assets at fair value through profit or loss	508	( 100 )
Finance costs	1,228	1,308
Interest income	( 4,016 )	( 185 )
Dividend income	( 43 )	( 5 )
Losses of inventory write-down or obsolescence	3,876	-
Share of losses of subsidiaries accounted for using the equity method	3,341	1,749
Unrealized gains on sales with subsidiaries	( 978 )	( 3 )
Net gains on foreign exchange	( 25,977 )	( 11 )
Changes in operating assets and liabilities
Contract assets	116,099	( 48,181 )
Accounts receivable (including those from related parties)	88,190	115,018
Other receivables (including those from related parties)	2,585	( 971 )
Inventories	( 18,743 )	( 3,989 )
Other current assets	4,123	19,300
Contract liabilities	1,890	( 1,162 )
Accounts payable (including those to related parties)	( 13,377 )	( 9,510 )
Other payables	10,967	( 16,353 )
Other current liabilities	29,688	83
Net defined benefit liability	( 4,930 )	( 2,787 )
Other non-current liabilities	23,304	-
Cash from operations	319,484	111,970
Interest paid	( 1,228 )	( 1,308 )
Income tax paid	( 9,367 )	( 14,714 )
Net cash generated by operating activities	308,889	95,948

(Cont’d)


	2022	2021
Cash flows from investing activities
Acquisition of financial assets at amortized cost	( $ 335,426 )	( $ 40,989 )
Disposal of financial assets at amortized cost	333,765	46,861
Acquisition of financial assets at fair value through profit or loss	( 33,733 )	( 70,000 )
Disposal of financial assets at fair value through profit or loss	-	70,084
Acquisition of property, plant and equipment	( 2,236 )	( 3,775 )
Refundable deposits (paid) refunded	( 16,167 )	790
Acquisition of intangible assets	( 6,797 )	( 5,841 )
Interest received	3,180	220
Dividends received	43	5
Net cash used in investing activities	( 57,371 )	( 2,645 )

Cash flows from financing activities
Repayment of long-term debt	( 2,289 )	( 2,254 )
Guarantee deposits refunded	( 83 )	( 472 )
Repayment for the principal of lease liabilities	( 2,308 )	( 2,280 )
Cash dividends paid	( 28,368 )	( 70,921 )
Net cash used in financing activities	( 33,048 )	( 75,927 )

Effect of exchange rate changes on cash and cash equivalents	24,136	236

Net increase in cash and cash equivalents during the year	242,606	17,612

Cash and cash equivalents, beginning of year	112,993	95,381

Cash and cash equivalents, end of year	$ 355,599	$ 112,993

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

Attachment 5

Attachment 6

Comparison Table of the “Articles of Incorporation” of the Company

Amended	Current	Description
Article 2: The scope of business of the Company is as follows: CC01100 Controlled Telecommunications Radio-Frequency Devices and Materials Manufacturing I301010 Information Software Services CC01120 Data Storage Media Manufacturing and Duplicating	Article 2: The scope of business of the Company is as follows: F401021 Restrained Telecom Radio Frequency Equipments and Materials Import [limited to radio transmitters, radio transceivers, industrial, scientific, medical equipment with radio waves, and other electrical machinery that generates radio waves] CC01101 Controlled Telecommunications Radio-Frequency Devices and Materials Manufacturing [limited to radio transmitters, radio transceivers, industrial, scientific, and medical equipment with radio waves, and other electrical machinery that generates radio waves] I301010 Information Software Services CC01120 Data Storage Media Manufacturing and Duplicating	Amended relevant requirements in accordance with the amendments to the List of Codes of Business Activities of Companies, Firms, and Limited Partnerships published by the Ministry of Economic Affairs on August 12, 2020.
Article 3: The headquarters of the Company is located in Hsinchu Science Park, and it may establish domestic and foreign branches or branches when necessary based on the resolution of the Board.	Article 3: The headquarters of the Company is located in Hsinchu Science Park, and it may establish domestic and foreign branches or branches when necessary based on the resolution of the Board.	Amended relevant requirements due to the change in the name of Hsinchu Science Park.
Article 6: When issuing share certificates, share certificates of the Company are registered, signed or affixed with seals by Directors representing the Company, and numbered, and issued after being certified by the competent authority or an issuance registration institution it approved according to the law.	Article 6: When issuing share certificates, share certificates of the Company are registered, signed or affixed with seals by three Directors or above, and numbered, and issued after being certified by the competent authority or an issuance registration institution it approved according to the law.	Amended relevant requirements in accordance with the amendments to paragraph 1, Article 162 of the Company Act on November 1, 2018; the initial requirements of having signatures or seals of three Directors of share certificates was amended as only requiring the signatures or seals of Directors representing the Company.
Article 34: The Articles were established after receiving the consent of all founders on October 28, 1991. The first amendment was made on February 21, 1992. The second amendment was made on June 12, 1992. The third amendment was made on November 30, 1993. The fourth amendment was made on November 25, 1997. The fifth amendment was made on April 13, 1998. The sixth amendment was made on June 3, 1999. The seventh amendment was made on May 12, 2000. the eighth amendment was made on April 27, 2001. The ninth amendment was made on May 30, 2002. The tenth amendment was made on June 7, 2007. The eleventh amendment was made on June 27, 2008. The twelfth amendment was made on June 17, 2010. The thirteenth amendment was made on June 24, 2011. The fourteenth amendment was made on June 27, 2012. The fifteenth amendment was made on June 25, 2013. The sixteenth amendment was made on June 22, 2015. The seventeenth amendment was made on June 23, 2016. The eighteenth amendment was made on June 25, 2019. The nineteenth amendment was made on June 30, 2020. The twentieth amendment was made on June 29, 2022. The twenty-first amendment was made on June 28, 2023.	Article 34: The Articles were established after receiving the consent of all founders on October 28, 1991. The first amendment was made on February 21, 1992. The second amendment was made on June 12, 1992. The third amendment was made on November 30, 1993. The fourth amendment was made on November 25, 1997. The fifth amendment was made on April 13, 1998. The sixth amendment was made on June 3, 1999. The seventh amendment was made on May 12, 2000. the eighth amendment was made on April 27, 2001. The ninth amendment was made on May 30, 2002. The tenth amendment was made on June 7, 2007. The eleventh amendment was made on June 27, 2008. The twelfth amendment was made on June 17, 2010. The thirteenth amendment was made on June 24, 2011. The fourteenth amendment was made on June 27, 2012. The fifteenth amendment was made on June 25, 2013. The sixteenth amendment was made on June 22, 2015. The seventeenth amendment was made on June 23, 2016. The eighteenth amendment was made on June 25, 2019. The nineteenth amendment was made on June 30, 2020. The twentieth amendment was made on June 29, 2022.	Added the date of the amendment.

Appendix 1

Articles of Incorporation of Loop Telecommunication International, Inc.

Chapter 1 General

Article 1: The Company was organized according to the requirements of the Company Act and named Loop Telecommunication International, Inc..

Article 2: The scope of business of the Company is as follows:

F401021 Restrained Telecom Radio Frequency Equipments and Materials Import [limited to radio transmitters, radio transceivers, industrial, scientific, medical equipment with radio waves, and other electrical machinery that generates radio waves]

CC01101 Controlled Telecommunications Radio-Frequency Devices and Materials Manufacturing [limited to radio transmitters, radio transceivers, industrial, scientific, and medical equipment with radio waves, and other electrical machinery that generates radio waves]

I301010 Information Software Services

CC01120 Data Storage Media Manufacturing and Duplicating

Research, development, production, manufacturing, and sales of the following products
User remote line disconnectors, protectors and their components
Line reactors and their components
Subtitle phones and their components
Smart network resource management selectors

Network access equipment, including T1/E1, FT1/FE1 CSU, and CSU/DSU, and their components

Pulse code modulation carrier terminals and their components

64K/56Kbps transmission equipment, including DDS, and its components

High-speed digital user transmission systems and their components

DLC digital user loop carriers

LAN/WAN equipment, network management systems, their sub-systems, and their components
Overall service for digital network terminal connectors, their sub-systems, and their components
Convertors, remote controls for cable TVs, and their components
Communication system power supply units and their components
Radio communication systems and their components
Consultation, design, installation and repair related to the abovementioned businesses, and import/export trading operations related to the businesses of the Company

Article 3: The headquarters of the Company is located in Hsinchu Science Park, and it may establish domestic and foreign branches or branches when necessary based on the resolution of the Board.

Article 3-1: The Company may provide guarantees to external parties for its business requirements.

Article 3-2: The Company may make necessary investments in external parties, and the total investments are not subject to the restrictions related to investment limits stated under Article 13 of the Company Act; the Board is authorized to make business decisions on investments.

Article 4: Deleted.

Chapter 2 Shares

Article 5: The total capital of the Company is NT$1,280 million, divided into 128,000,000 shares with a par value of NT$10 per share; the Board is authorized to issue the unissued shares in batches. The total capital includes NT$200 million, divided into 20,000,000 shares with a par value of NT$10 per share, preserved for the conversion of convertible corporate bonds, and NT$100 million, divided into 10,000,000 shares with a par value of NT$10 per share, preserved for the exercise of options for stock warrant.

Article 5-1: For the declaration of the issuance of employee stock option certificate by the Company, when the subscription price is lower than the closing price on the issuance day, the exercise of options shall receive the consent of attending shareholders with over two-thirds of the voting rights at a meeting attended by shareholders representing over half of the total issued shares.

Article 5-2: If the Company transfer shares to employees at a price lower than the average price for the actual repurchase of shares, it shall receive the consent of attending shareholders with over two-thirds of the voting rights at the upcoming shareholders’ meeting attended by shareholders representing over half of the total issued shares.

Article 6: When issuing share certificates, share certificates of the Company are registered, signed or affixed with seals by three Directors or above, numbered, and issued after being certified by the competent authority or an issuance registration institution it approved according to the law.

Shares issued by the Company are exempted from printing share certificates; however, the Company shall register them with a centralized securities depository enterprise.

Article 7: Deleted.

Article 8: Deleted.

Article 9: The change in shareholders’ names shall be suspended 60 days, 30 days, and or 5 days before the regular shareholders’ meeting, an extraordinary shareholders’ meeting, or the base date on which the Company decides to distribute dividends and bonuses or other benefits.

Article 11: Stock affairs operations of the Company shall be subject to the “Regulations Governing the Administration of Shareholder Services of Public Companies” and relevant laws and regulations.

Chapter 3 Shareholders’ meetings

Article 12: Shareholders’ meetings of the Company are divided into the following:

I. Annual shareholders’ meetings are convened once a year within six months from the end of each fiscal year by the Board according to the law.

II. Extraordinary shareholders’ meetings are convened according to the law when necessary.

Article 13: For convening shareholders’ meetings, the Company shall announce and notify shareholders of the date, venue, and reason for the meeting 30 days or 15 days before an annual shareholders’ meeting or an extraordinary shareholders’ meeting, respectively. For shareholders holding registered share certificates of less than 1,000 shares, the meeting notice may be made by way of announcements.

Article 13-1: Shareholders’ meetings may be held by way of a video conference or other methods announced by the Ministry of Economic Affairs.

Article 14: Shareholders of the Company are entitled to one vote for each share held apart from circumstances stated under Article 179 of the Company Act.

rticle 14-1: Except for otherwise stated in the Company Act, resolutions made by the shareholders’ meeting shall receive the consent of attending shareholders with more than half of the voting rights at a meeting attended by shareholders representing more than half of the total number of shares.

Article 15: If a shareholder is unable to attend a shareholders’ meeting due to other causes, it may issue a proxy form, which is printed and distributed by the Company, and affix its seal that is kept with the Company to engage a proxy to attend the shareholders’ meeting on its behalf.

Article 16: The Chairman shall be the chairperson of shareholders’ meetings. If the Chairman is on leave or is unable to exercise its powers due to other causes, the Chairman shall designate a Director to act on its behalf; if the Chairman fails to make such designation, Directors shall elect one person among themselves to act on behalf of the Chairman.

Article 17: Matters relating to the resolutions of a shareholders’ meeting shall be recorded in the meeting minutes. The meeting minutes shall be signed or sealed by the chairperson of the meeting, and a copy distributed to each shareholder within 20 days after the conclusion of the meeting. The production and distribution of the meeting minutes may be done in electronic form. The Company may distribute the meeting minutes of the preceding paragraph by means of a public announcement. Meeting minutes, attendance book of attending shareholders and proxy forms to engage proxies shall be preserved together by the Company.

Directors, Audit Committee, and managers

Article 18: The Company has seven to 15 Directors, who shall be elected by the shareholders’ meeting from capable persons; the term of office is three years, and they may be re-elected and re-appointed. Total shares of Directors of the Company are subject to the requirements of the competent authority. A candidate nomination system is adopted for the election of the Company’s Directors, and the acceptance method for the nomination of candidates is subject to the requirements under Article 192-1 of the Company Act.

Where all Directors of the Company are re-elected at a shareholders’ meeting, prior to the expiration of the term of office of existing Directors, and in the absence of a resolution that existing Directors will not be discharged until the expiry of their present term of office, all existing directors shall be deemed discharged upon the completion of the re-election. In case no election of new Directors is effected after the 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. In the number of Directors above, the number of Independent Directors shall be no less than two persons and no less than one-fifth of the number of all Directors. The candidate nomination system is adopted for Independent Directors, and the shareholders shall elect them from the list of Independent Director candidates. The qualification, shareholding, restriction on concurrent position, nomination, election method, and other matters to be observed are subject to relevant requirements of the competent authority of securities.

Article 19: The Board is formed by the Directors, and the powers of the Board are subject to the requirements of the Company Act and relevant regulations.

Article 19-1: The Company may purchase liability insurance for Directors within the term of office for the compensation liability they assume according to laws within the scope of business execution.

Article 20: The Board shall be composed of the Directors. A Chairman shall be elected among the Directors by receiving the consent of more than half of the attending Directors at a meeting attended by two-thirds of the Directors; the Chairman represents the Company to external parties. If the Chairman is on leave or is unable to exercise its powers due to other causes, the Chairman shall designate a Director to act on its behalf; if the Chairman fails to make such designation, Directors shall elect one person among themselves to act on behalf of the Chairman.

Article 21: Resolutions at a Board meeting shall, unless otherwise stated in the Company Act and the Articles, be adopted by receiving the consent from more than half of the Directors at a meeting attended by more than half of the Directors. A Director who has a personal interest in the matter under discussion at a Board meeting shall explain to the Board meeting the essential contents of such personal interest.

Article 22: If the Director is unable to attend the meeting, it may engage another Director as its proxy; a Director may only be the proxy of one Director. If a video conference is adopted for a Board meeting, Directors who participate in the meeting via video calls shall be deemed as attending in person. The convening notice of Board meetings may be made by way of either correspondence, facsimile, or e-mail.

Article 23: Powers of the Audit Committee are subject to the requirements under the Company Act and relevant laws and regulations.

Article 24: The number of members of the Audit Committee, term of office, powers, rules of procedure, and resources to be provided by the Company when exercising powers shall be otherwise stated in the Charter of the Audit Committee.

Article 25: The Company has one President who is nominated by the Chairman and appointed after receiving consent from over two-thirds of the Directors. The President shall arrange corporate operations according to the resolutions of the Board.

Article 26: Deleted.

Chapter 5 Accounting

Article 27: The fiscal year of the Company is from January 1 to December 31. The final account shall be prepared at the end of each fiscal year. After the final annual account, the Board shall prepare forms and statements according to the requirements of the Company Act and submit them to the Audit Committee for review 30 days before the annual shareholders’ meeting and then propose to the shareholders’ meeting for ratification. The distribution of the books and statements above may be made by way of public announcements.

Article 28: Dividends are determined by the shareholders’ meeting based on the earnings of the Company; however, if there is no earning, dividends may not be appropriated from the share capital.

Article 29: The Company shall appropriate no less than 10% and no more than 5% of the net profit before the period before deducting remuneration of employees and remuneration of Directors as the remuneration of employees and remuneration of Directors, respectively; however, if the Company has cumulative losses (including adjusted undistributed earnings), it shall preserve the compensation amount.

Remuneration of employees in the preceding paragraph may be made in shares or cash, and the distribution targets may include employees, who fulfill certain conditions, of subordinated companies; remuneration of Directors in the preceding paragraph may only be made in cash.

The two paragraphs above shall be implemented according to the resolutions of the Board and reported to the shareholders’ meeting.

If the Company has net profit after tax for the period after the final account of the year, it shall compensate cumulative losses (including the adjustments to undistributed earnings), appropriate 10% as the legal reserve according to the law; however, this shall not apply when the legal reserve has reached the paid-in capital of the Company. Then, it shall appropriate or reverse the special reserve according to the requirements under laws and regulations and of the competent authority. Subsequently, for the remaining earnings, together with the undistributed earnings at the beginning of the period (including the adjustments to undistributed earnings), the Board shall prepare a proposal for earning distribution and submit it to the shareholders’ meeting for the resolution of shareholders’ dividends/bonuses distribution.

The dividend policies of the Company respond to the current and future development plans, taking investment environments, capital requirements, and domestic and foreign competition status into account, with equal consideration given to shareholders’ benefits. The Board shall prepare the proposal for earning distribution, and the shareholders’ meeting shall make the resolution. Distribution of shareholders' dividends/bonuses may be made in shares or cash; however, in principle, the ratio of cash dividends to all dividends shall not be less than 10%.

Article 30: Deleted.

Article 31: The Board is authorized to determine the remuneration of a Chairman and Director based on their level of participation in the Company’s operation and the value of their contributions with reference to the domestic and foreign standards within the industry.

Chapter 6 Appendices

Article 32: The organizational rules and administrative regulations of the Company shall be otherwise established.

Article 33: Unaddressed matters in the Articles shall be subject to the requirements under the Company Act and other relevant laws and regulations.

Article 34: The Articles were established after receiving the consent of all founders on October 28, 1991. The first amendment was made on February 21, 1992. The second amendment was made on June 12, 1992. The third amendment was made on November 30, 1993. The fourth amendment was made on November 25, 1997. The fifth amendment was made on April 13, 1998. The sixth amendment was made on June 3, 1999. The seventh amendment was made on May 12, 2000. the eighth amendment was made on April 27, 2001. The ninth amendment was made on May 30, 2002. The tenth amendment was made on June 7, 2007. The eleventh amendment was made on June 27, 2008. The twelfth amendment was made on June 17, 2010. The thirteenth amendment was made on June 24, 2011. The fourteenth amendment was made on June 27, 2012. The fifteenth amendment was made on June 25, 2013. The sixteenth amendment was made on June 22, 2015. The seventeenth amendment was made on June 23, 2016. The eighteenth amendment was made on June 25, 2019. The nineteenth amendment was made on June 30, 2020. The twentieth amendment was made on June 29, 2022.

Loop Telecommunication International, Inc.

Appendix 2

Rules of Procedure for Shareholders’ Meetings

Except as otherwise provided by laws and regulations, shareholders’ meetings of Loop Telecommunication International, Inc. (the “Company”) shall be as provided in these Rules of Procedure.
The time during which shareholder attendance registrations will be accepted shall be at least 30 minutes prior to the time the meeting commences. The place at which attendance registrations are accepted shall be clearly marked with a sufficient number of suitable personnel assigned to handle the registrations. The attendance shall be calculated based on the attendance book or sign-in cards handed in. 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.
The votes at the shareholders’ meeting shall be calculated based on shares.
The venue for a shareholders’ meeting shall be the location 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.
If a shareholders’ meeting is called by the Board, the Chairman shall preside at the said shareholders’ meeting. In case the Chairman is on leave of absence or cannot exercise its powers and authority, the Vice Chairman shall act on its behalf. If there is no Vice Chairman or the Vice Chairman is also on leave of absence or cannot exercise its powers and authority, the Chairman shall designate a Managing Director or Director who has held that position for six months or more and understands the financial and business conditions of the Company to act on its behalf; if there is no Managing Director, the Chairman shall designate a Director to act on its behalf. If the Chairman does not designate a Director, the Managing Directors or Directors shall elect one from among themselves to act on behalf of the Chairman.

If a shareholders’ meeting is convened by a party with the power to convene but other than the Board, the convening party shall chair the meeting.

The Company may appoint its attorneys, CPAs, or related persons retained by it to attend a shareholders’ meeting in a non-voting capacity.
Staff handling administrative affairs of a shareholders’ meeting shall wear identification cards or armbands.
The Company, beginning from the time it accepts shareholder attendance registrations, shall make an uninterrupted audio and video recording of the registration procedure, the proceedings of the shareholders’ meeting, and the voting and vote counting procedures. The recorded materials of the preceding paragraph shall be retained for at least one year.
The chairperson 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 chairperson 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 paragraph 1, Article 175 of the Company Act. When, prior to the conclusion of the meeting, the attending shareholders represent a majority of the total number of issued shares, the chairperson may resubmit the tentative resolution for a vote by the shareholders’ meeting pursuant to Article 174 of the Company Act.
If a shareholders’ meeting is convened by the Board, the meeting agenda shall be set by the Board. The meeting shall proceed in the order set by the agenda, which may not be changed without a resolution of the shareholders’ meeting.

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. The chairperson may not declare the meeting adjourned prior to the completion of deliberation on the meeting agenda of the preceding two paragraphs (including extempore motions).

After the adjournment of the meeting, shareholders may not otherwise elect a chairperson to continue the meeting at the initial venue or another venue. However, if the chairperson declares the meeting adjourned in violation of the Rules of Procedure, the attending shareholders may elect a new chairperson in accordance with statutory procedures by agreement of a majority of the votes represented by the attending shareholders and then continue the meeting.

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 chairperson.

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.

When an attending shareholder is speaking, other shareholders may not speak or interrupt unless they have sought and obtained the consent of the chairperson and the shareholder that has the floor; the chairperson shall stop any violation.

Except with the consent of the chairperson, a shareholder may not speak more than twice on the same proposal, and a single speech may not exceed five minutes.
If the shareholder's speech violates the rules or exceeds the scope of the agenda item, the chairperson may terminate or suspend the speech.
When a corporation is appointed to attend as a proxy, it may designate only one person to represent it in the meeting. When a corporate shareholder appoints two or more representatives to attend a shareholders' meeting, only one of the representatives so appointed may speak on the same proposal.
XIV. After an attending shareholder has spoken, the chairperson may respond in person or direct relevant personnel to respond.
When the chairperson is of the opinion that a proposal has been discussed sufficiently to put it to a vote, the chairperson may announce the discussion closed, call for a vote.
Vote monitoring and counting personnel for the voting on a proposal shall be appointed by the chairperson, provided that all monitoring personnel shall be shareholders of the Company. The results of the votes shall be reported on-site, and minutes shall be made.
Matters relating to the resolutions of a shareholders’ meeting shall be recorded in the meeting minutes. The meeting minutes shall be signed or sealed by the chairperson of the meeting, and a copy distributed to each shareholder within 20 days after the conclusion of the meeting. The production and distribution of the meeting minutes may be done in electronic form.
When a meeting is in progress, the chairperson may announce a break based on time considerations.
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. For the vote, if the chairperson has made inquiries to attending shareholders and no dissenting opinion is raised, it shall be deemed approved by all shareholders. If there is any dissenting opinion, the chairperson may deem the number of votes of the attending shareholders less the number of votes of shareholders with dissenting opinions as the number of votes for the proposal, and if the number exceeds the number of votes required, the proposal shall be deemed as approved. The effects of the two voting methods above shall be equivalent to voting by ballots. The results of the votes shall be reported on-site, and minutes shall be made.
When there is an amendment or an alternative to a proposal, the chairperson shall present the amended or alternative proposal together with the original proposal and decide the order in which they will be put to the vote. When any among them is passed, the other proposals will then be deemed rejected, and no further voting shall be required.
The chairperson 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."
The Rules of Procedure were implemented after being approved by the annual shareholders’ meeting as a resolution, and the same shall apply upon any amendment.

The shareholders’ meeting approved the establishment on June 3, 1999.

The first amendment was made on May 30, 2002.

The second amendment was made on June 27, 2012.

The third amendment was made on June 25, 2013.

Appendix 3

Effect of stock grants on business performance, earnings per share of the Company, and return on investments: The Company has no stock grant during the year; therefore, this is not applicable.

Appendix 4

Loop Telecommunication International, Inc.

Shareholding of Directors

At present, the number of issued shares of the Company is 70,920,550 shares.
According to the requirements of the Rules and Review Procedures for Director and Supervisor Share Ownership Ratios at Public Companies, the minimum shareholding of the Directors shall be 5,673,644 shares.
As of April 29, 2023, the book closure date of the shareholders’ meeting, the shareholding of all Directors is as follows:


Title	Name	Shares held
Chairman	Yeh Maw-Lin	7,032,306
Director	Chen Hua-Ling	1,888,922
Director	Fan Zheng-Chun	243,000
Director	Chiu Dong-Sheng	370,607
Independent Director	Huang Yun-Ming	0
Independent Director	Chang Guo-Hua	0
Independent Director	Jiang Min-Shiung	0
Independent Director	Ko Shu-Mei	0
Directors in aggregate		9,534,835

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