LP — AGM Information 2021

Aug 27, 2021

Stock Code：1447

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LI PENG ENTERPRISE CORPORATION

Handbook of 2021 Annual General Shareholders’ Meeting

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Date: June 23, 2021 Place: No. 33, Gongye Road, Fangyuan Industrial Zone, Fangyuan Township, Changhua County (Nylon General Factory)

LI PENG ENTERPRISE CORPORATION

Handbook of 2021 Annual General Shareholders’ Meeting (Translation)

Table of Contents

Ⅰ. Meeting Procedures ----------------------------------------------------------------------------- 1 Ⅱ. Meeting Agenda --------------------------------------------------------------------------------- 2 Ⅲ. Report Items ------------------------------------------------------------------------------------- 3 Ⅳ. Matters for Ratification ------------------------------------------------------------------------- 8 Ⅴ. Matters for Discussion and Election ---------------------------------------------------------- 10 Ⅵ. Extemporary Motion ---------------------------------------------------------------------------- 13 Ⅶ. Attachments 1. The 2020 auditing report and financial statements --------------------------------------- 14 2. Comparative Table for the Current and Amended Articles of “Article of association” ------------------------------------------------------------------------------------ 32 3. Rules for the Election of Directors --------------------------------------------------------- 39 4. Rules of Procedure for Shareholders’ Meetings ------------------------------------------ 40 5. Shareholding of All Directors --------------------------------------------------------------- 43

Notice to readers

This is a translation of the Handbook of 2021 Annual General Shareholders’ Meeting. The translation is for reference only. If there is any discrepancy between the English version and Chinese version, the Chinese version shall prevail.

LI PENG ENTERPRISE CO., LTD.

2021 Annual General Shareholders’ Meeting Procedures

1. Commencement of Meeting

2. Chairman’s Statement

3. Report Items

4. Matters for Ratification

5. Matters for Discussion and Election

6. Extemporary Motion

7. Meeting Adjourned

8. 1 -

LI PENG ENTERPRISE CO., LTD.

2021 Annual General Shareholders’ Meeting Agenda

Time: 2021/ 06/ 23 (Wednesday), 9 a.m.

Place: No. 33, Gongye Road, Fangyuan Industrial Zone, Fangyuan Township, Changhua County (Nylon General Factory)

Meeting Procedures

1. Commencement of Meeting（Report on the number of attended shares）

2. Chairman’s Statement

3. Report Items:

4. (1) The 2020 business report

5. (2) The 2020 audit committee’s audit report

6. (3) Report on Allocation of 2020 Remuneration to Board of Directors and Employees.

7. Matters for Ratification

8. (1) The 2020 business reports and financial statements

9. (2) The 2020 proposals for surplus distribution or loss allowances

10. Matters for Discussion and Election:

11. (1) Amendment to “Article of association”

12. (2) Re-election of directors

13. (3) Removal of Non-Competition Restriction Against the Board of Directors and representatives

14. Extemporary Motion

15. Meeting Adjourned

16. 2 -

Report Items

Ⅰ. The 2020 business report

Explanatory Notes: The 2020 business report is as follows.

Business report

1. The 2020 operational performance

(1) Plan execution:

Due to the Covid-19 epidemic, many countries ’block down has significant impact on the global supply chain. This results in a sharp decline in revenue in the first half of 2020. Moreover, the price of CPL raw materials hit bottom in the third quarter, which also affected the price and sales of nylon chips and nylon yarn. Additionally, the material suppliers stop manufacturing for maintenance in the fourth quarter causing decreased market supply, which is expected to influence the price. In the third quarter, our company established a subsidiary, named Eton Petrochemical Co., Ltd, participating in chemicals trading sector, implementing diversification and vertical integration to supply to Polytex petrochemical companies. This on one hand contributes to company’s overall benefit. On the other hand, the company through Eton seizes potential opportunities in petrochemical industry, increasing the accuracy of the company's judgment on the supply and demand of the textile market and enhancing the effectiveness of operating strategy implementation.

The 2020 consolidated revenue is NT$13.559 bil, 7.00% lower than that of 2019. After tax income is NT$ -414 mil, 69.77% lower than that of 2019. Major products are nylon chips 119,178 tons, nylon yarn 27,452 tons, woven fabric 30,850 thousand yards 、 knit fabric 819 tons.

(2) Budget implementation ：

Not available. Our company only set the 2020 internal budget, and did not disclose financial forecasts to the public.

(3) Revenue, expenditure, and profitability analysis ：

The 2020 unconsolidated revenue of subsidiaries is NT$ 10.37 billion, after tax income is NT$ -412 mil, After tax profit margin is -3.97%, earnings per share is NT$ -0.48. Our company unconsolidated financial income and expense and profitability analysis are as below table.

Unit: Thousand NT$

				Unit: Thousand NT$
				Increase (Decrease)
	Item	2019	2020
				Amount and Ratio
	Operating income	14,452,347	10,369,775	-4,082,572
Financial
	Operating cost	14,091,788	10,168,838	-3,922,950
income and
	Before tax profit	-322,087	-533,806	-211,719
expense
	Net Income	-249,366	-412,009	-162,643
	Return on asset (%)	-1.11	-2.12	-1.01
	Return on equity (%)	-2.61	-4.39	-1.78
	Before tax income to paid-in capital
Profitability		-3.52	-5.83	-2.31
	ratio (%)
	Profit margin (%)	-1.72	-3.97	-2.25
	Earnings pershare (NT$)	-0.29	-0.48	-0.19

• 3 -

(4) Research and development ：

The company’s product R&D direction is still mainly to meet the customers’ demand. Beside diversifying high value-added products, we reach out of the textile area, moving toward industrial plastic area, expanding the application range of nylon.

Moreover, our product development also focuses on environmental protection and the concept of energy saving and carbon reduction. Environment friendly products contribute to reduction of energy consumption, greenhouse gas emission during the manufacturing process. The R&D has recently been focused on waste recycling, and gained positive outcomes. It has successfully converted environmental protection concepts into actual orders, achieving the economic goals. The company’s products which have been mass-produced are as following table:

Type	Application	Specifications
Elastic Nylon Chip/Yarn	Injection grade and fiber grade footwear textile industrial fiber, single fiber	Naturally elastic fiber, elasticity without processing
Modified/Functionalized Nylon Chip	Used for upgrading the physical properties of products such as injection grade and extrusion grade, replacing the customers; existing imported materials.	Increase nylon chips’ added value, also low gravity specification which are also in line with lightweight concepts and differentiation to the other suppliers.
Film grade Nylon Chip	Improving the physical properties of film products to enhance stability
Functionalized Monofilament from Nylon Chip	Extrusion grade and fiber grade monofilament, industrial fiber, monofilament	Increase nylon chips’ value added and differentiate with the other manufacturers
Transparent Nylon Chip	Injection grade and extruded product physical properties modification use
Brittle Polyether Chip	Modification of injection- grade and fiber-grade footwear fabric material, industrial fiber, single fiber, and recycled chips	High light transmittance, replacing PET differentiated products, high dyeing and finishing dispersion uniformity, high spinning yield Low viscosity attenuation rate during processing is in line with environmentally friendly recycling purposes
Low dye nylon fiber	High grade knit fabric, sports, leisure	Combined with normal nylon fibers to produce a two-tone nylon processed yarn
Antibacterial nylon yarn		Increase the antibacterial effectiveness after laundering and dyeing
Low moisture absorption nylon yarn		Low moisture absorption and high product size stability

• 4 -

Type	Application	Specifications
Nylon recycled yarn	Knit fabric textile, sport, leisure	GRS green recycling application
Flame retardant nylon yarn	touch fastener, tents	Flame retardant effect

2. The 2021 business plan summary

In terms of business strategy, the company defines this year as a leap year, with the overall spirit of “the whole company is of one mind, establishing a sustainable foundation, crossing the boundary, and breaking through international changes”.

The world has been continuously affected by Covid-19 pandemic. Taiwan has achieved such a good pandemic prevention thanks to the unity of the whole country. Also, our company with unity spirit turns risks into opportunities. In order to reduce plastic consumption, textile product application expands to 3C supporting products. With our strong R&D, sales and one stop production services, we are able to coordinate with brand owners’ R&D plan for product development, facilitating the penetration of textile products in electronic materials. We will also actively expand the market and seize business opportunities in 3C application field.

Nylon business unit: Carefully evaluate the supply and demand changes and price fluctuations of raw and auxiliary materials to effectively plan procurement strategies.

Nylon chips: Actively developing and selling products, expanding the scope of application; boosting sales in India, Central and South America, and developing new markets.

Nylon yarn ： Seeking for more stable quality and continue making differentiated products.

High-end textile business unit: Improving coloring accuracy, promptly responding to customer needs; developing environmentally friendly, functional, and high-value-added textile products, strengthening brand cooperation, and seeking for new customers.

3. The company’s future development strategy under impacts of external environment, legal environment, and overall business environment

With the rise of environmental awareness, in recent years, global brands such as home furniture, apparel, footwear materials, 3C, etc. have begun to set annual carbon reduction targets. Besides their own requirements, their supply chain manufacturers also need to join carbon reduction process in order to obtain a complete green product life. The RePET, Ecoya, and ReEcoya developed by our company, and waste recycled products, have been highly recognized, and the sales volume has been increasing year by year.

For gaining more global environmentally friendly product orders, aiming to green production goals, Libolon Energy Co. LTD was established with 70% investment from our company, preparing to invest in the green power field of wind power generation to provide the energy required for the group's production. In the future, the company will move towards the goal that 100% of the power for production is green energy.

In the face of the global economic downturn and instability, the company still strives to seek for innovation and change, showing its determination of sustainable operation. Finally, I would like to express my deepest gratitude to all shareholders and wish you all good health and all the best.

Chairman ： KUO SHAO YI Manager ： KUO SHAO YI Accounting head ： KO PEI CHUN

• 5 -

Ⅱ. The 2020 audit committee’s audit report:

Explanatory Notes: The audit committee’s audit review is as follows:

Audit committee’s audit report

The audit committee reviewed the business report, the proposal for surplus distribution or loss allowances and the 2020 financial statements which were prepared by the Board of Directors. The financial statements were audited by Deloitte’s accountants, Wu, Ker-Chang and Chiu, Ming-Yu and an audit report was issued. It is believed that there is no discrepancy, and they were submitted for revision in accordance with Article 14-4 of the Securities Exchange Act and Article 219 of the Article of association.

Regards,

The company’s 2021 regular shareholders’ meeting

LI PENG ENTERPRISE CO., LTD.

Audit committee convener ： Lin, Yao Chuan

Taiwan, March 29, 2021

• 6 -

Ⅲ. Report on Allocation of 2020 Remuneration to Board of Directors and Employees.

Explanatory Notes: Since 2020 saw a before tax loss, it is not necessary to allocate employee and director’s remuneration.

• 7 -

Matters for Ratification

Item 1

Proposed by the Board of Directors

Proposal: The 2020 business report and financial statements.

Explanatory Notes:

1. The 2020 financial statements audited by Deloitte’s accountants Wu, Ker-Chang and Chiu, Ming-Yu together with the business report reviewed by the audit committee with audit reports.

2. The business report, the accountant’s audit report and the above-mentioned financial statements are as Attachments 1, p.3 ～ 5 and p.14 ～ 31.

Resolution ：

• 8 -

Item 2

Proposed by the Board of Directors

Proposal: The 2020 proposals for surplus distribution or loss allowances

Explanatory Notes:

The 2020 net loss after tax income is NT$ 412,009,449. The 2020 proposals for surplus distribution or loss allowances is as follows

LI PENG ENTERPRISE CO.,LTD. Proposals for surplus distribution or loss allowances

R.O.C 2020

Unit: NT$

R.O.C	2020	2020	Unit: NT$
Item	Amount		Note
Loss to be made up at the beginning of the period After tax income Actuarial profit (loss) included in retained earnings Equity method recognition and disposal of equity instruments measured at fair value through other comprehensive income (loss) Net (loss) profit after tax plus non-net (loss) profit after tax items included in retained earnings Set aside the special surplus reserve according to law (Note)	(412,009,449) 13,239,886 (14,363,329)	(248,943,111) (413,132,892) 372,966,405
Loss to be made up at the end of period		(289,109,598)

Note: According to the Financial Supervision and Administration Commission of the Executive Yuan, financial management certificate No. 1010012865 letter regulates the difference between the special surplus reserve and the net deduction of other equity is reversed.

Chairman ： KUO SHAO YI

Manager ： KUO SHAO YI

Accounting Head ： KO PEI CHUN

Resolution ：

• 9 -

Matters for Discussion and Election

Item 1

Proposed by the Board of Directors

Proposal: Amendment of “Articles of Association”

Explanatory Notes:

In accordance to legal regulation, Comparative Table for the Current and Amended Articles of Association is as attachment 3, Handbook page 33~38.

Resolution ：

Item 2

Proposed by the Board of Directors

Proposal: Director re-election

Explanatory Notes:

1. The term of the 19th Board of Directors shall end on June 11, 2021. According to laws and regulations and the Article of association, it is proposed to cooperate with this regular shareholders’ meeting to re-elect directors.

2. Pursuant to the Article of association, article 15, there are 9 directors to be elected (including 3 independent directors) deploying the candidate nomination system, each term lasts three years, from June 23, 2021 to June 22, 2024, and the term of the directors ends when the current regular shareholders' meeting is finished.

3. Director candidate list (including independent directors) was approved by the Board of Directors on May 13, 2021, as follows:

Type	Candidate	Major education and experience background	Shareholding
Director	KUO SHAO YI I	National Taiwan University of Science and technology- EMBA- Management Institute – Business Administration Department Chairman -Li Peng Enterprise Co., Ltd. Chairman- Lealea Enterprise Co., Ltd Chairman - Lealea Technology Co., Ltd. Chairman - Li Ling Film, Co., Ltd. Chairman- Lea Jie Energy Co., Ltd. Chairman- Apex Fong Yi Technology Co., Ltd. Chairman- Tung Ting Investment Co., Ltd. Chairman- Libolon Energy Co., Ltd Chairman- Eton Petrochemical Co., Ltd. Chairman- Pt. Indonesia Libolon Fiber System Chairman- In Talent Investments Limited	9,584,819
Director	CHEN PING HUANG	Provincial Taipei Institute of Technology -Chemical Engineering Department Deputy General Manager -Li Peng Enterprise Co., Ltd. Supervisor - Lea Jie Energy Co., Ltd. Director- Fuli Express Co.,Ltd.	53,343
Director	KUO CHI KANG	The U.S California State Polytechic Univeristy, Pomona, Hotel management department Director/CEO- Rich Development Co., Ltd. Chairman-	400,644

• 10 -

Type	Candidate	Major education and experience background	Shareholding
		Yilan Lealea Development Holding Co. Ltd. Director- Ho Ching Enterprises Co., Ltd. Director- Forest Water Environmental Engineering Ltd. Director- Li Peng Enterprise Co., Ltd. Director- Lealea Enterprise Co.,Ltd
Director	LEALEA ENTERPRISE CO., LTD Representative： TUNG,MIN-HSIUNG	Feng Chia Univerity, Department of Textile Engineering Deputy general manager - Li Peng Enterprise Co., Ltd. Supervisor - Libolon Energy Co., Ltd.	145,353,853
Director	LI MOU INVESTMENT Representative： KUO SU JEN	Yale University- MBA & Master Public Health Chairman -Ho Ching Enterprise Co., Ltd. Chairman - Lea He Investment Co. Ltd. Chairman - Forest Water Environmental Engineering Ltd. Chairman -Rich Development Co., Ltd. Director- Li Peng Enterprise Co., Ltd. Director- Lealea Enterprise Co.,Ltd	34,177,995
Director	SHUN YU INVESTMENT CO., LTD Representative： KUO KO CHUNG	San Maring High School Director - Li Peng Enterprise Co., Ltd. Director- Lealea Enterprise Co., Ltd Director--Rich Development Co.,Ltd	11,991,397
Independent Director	LIN YAO CHUAN	National Taiwan University, Deparment of Law Judge of Taiwan Shilin district Court Partner -Li-Yanglaw firm	0
Independent Director	KAO CHENG SHANG	Master degree of Politics, Chinese Culture Univerisity, National Taiwan University, Department of Law First Chairman- The Taipei City Government’s Indigenous Peoples Commission Deputy Director- Executive Yuan’s Council of Indegious People Executive Director - Taiwan Agricultural Strategic Alliance Foundation, Deputy excetive director- Taiwan foundation for Democracy Chief Executive Officer- Eastern District Construction Center, Indigenous tribe sustainable Development Project Director - Legal Aid Foundation	0
Independent Director	LEE SU CHIN	National Taiwan University, Master degree Chief Accountant- Delta Eletronics Inc., Financial management deparment.	0

Resolution ：

• 11 -

Proposed by the Board of Directors

Item 3

• Proposal: Removal of Non-Competition Restriction Against the Board of Directors and representatives

Explanatory Notes:

1. According to Article 209 of the Article of association, members of Board of Directors who engage in activities that fall within the scope of the company's business, either on their own or on a third party's account shall explain their actions and obtain the permission in the shareholders’ meeting.

2. In order to take advantage of the professional and relevant experience of the directors, it is proposed for approval of Removal of Non-Competition Restriction Against the Board of Directors and representatives elected at this meeting of shareholders according to the law.

3. Removal of Non-Competition Restriction Against the Board of Directors and representatives is as follows:

is as follows:
Directors	Company name	Position
KUO SHAO YI I	Lealea Enterprise Co., Ltd. Lealea Technology Co., Ltd. Apex Fong Yi Technology Co., Ltd. Tung Ting Investment Co., Ltd. Pt. Indonesia Libolon Fiber System Lea Jie Energy Co., Ltd. Li Ling Film Co., Ltd Libolon Energy Co., Ltd. Eton Petrochemical Co., Ltd In Talent Investments Limited	Chairman Chairman Chairman Chairman Chairman Chairman-Lealea Enterprise Co., Ltd. Representative Chairman-Tung Ting Investment Co., Ltd Representative Chairman Chairman Director
KUO CHI KANG	Forest Water Environmental Engineering Ltd. Ho Ching Enterprises Co., Ltd Lealea Hotels Co., Ltd Rich Development Co., Ltd. Yilan Lealea Development Holding Co., Ltd Orient Forest Development Enterprise Co., Ltd. Green Forest Development Enterprise Co., Ltd. Lealea Wushih Marina & Resorts Co., Ltd LiJing Enterprise Co., Ltd Lealea Garden Hotel Co., Ltd	Director- Rich Development Co., Ltd. Representative Director- Rich Development Co., Ltd. Representative Director Director Chairman Director- Forest Water Environmental Engineering Ltd. Representative Director- Rich Development Co., Ltd. Representative Director -Rich Development Co., Ltd. Representative Director -Rich Development Co., Ltd. Representative Director- The Richforest Hotel Co., Ltd. Representative
CHEN PING HUANG	Fu Li Express Co., Ltd	Director
LEALEA ENTERPRISE CO., LTD	Li Hao Investment Co., Ltd. Li Zan Investment Co., Ltd. Lea Jie Energy Co., Ltd. Libolon Enterprise Co., Ltd.	Chairman Chairman Chairman Director

• 12 -

Director Representative	Company Name	Position
KUO SU JEN	Forest Water Environmental Engineering Co., Ltd. Ho Ching Enterprises Co., Ltd Lealea hotels Co., Ltd Rich Development Co., Ltd. Li Peng Enterprise Co., Ltd. Lead Way Investments Group Ltd Orient Forest Development Enterprise Co., Ltd. Green Forest Development Enterprise Co., Ltd LiJing Enterprise Co., Ltd Lea Ming Construction Co., Ltd Lealea Wushih Marina & Resorts Co., Ltd Lealea Enterprise Co., Ltd. Taiwan Green Power Co., Ltd	Chairman- Rich Development Co., Ltd Representative Chairman- Rich Development Co., Ltd. Representative Director Chairman Chairman - Rich Development Co., Ltd. Representative Chairman Chairman - Forest Water Environmental Engineering co., Ltd. Representative Chairman- Forest Water Environmental Engineering co., Ltd. Representative Chairman - Rich Development Co., Ltd., Representative Chairman Director - Rich Development Co., Ltd., Representative Director -Li Peng Enterprise CO., LTD. Representative Chairman
KUO KO CHUNG	Lealea Enterprise Co.,Ltd. Rich Development Co., Ltd.	Director- Shun Yu Investment Co., Ltd. Representative Director - Shun Yu Investment Co., Ltd Representative

Resolution ：

Extemporary Motion

Meeting Adjourned

• 13 -

Attachments 1

Independent Auditor’s Report

To Li Peng Enterprise Company Limited

Opinion

We have audited the accompanying consolidated financial statements of Li Peng Enterprise Company Limited and its subsidiaries (the “Company”), which comprise the consolidated balance sheets as of December 31, 2020 and 2019, and the consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and the notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company 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 the 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 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 Company in accordance with The Norm of Professional Ethics for Certified Public Accountant 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 judgement, were of most significance in our audit of the consolidated financial statements for the year ended December 31, 2020. 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, 2020 are stated as follows:

The Actual Occurrence of Sales Revenue

The Company comprises of nylon department, weaving department, and trading department. The sales revenue of the nylon department is the highest among all. Nylon products are mainly traded as commodity and the sales condition varies from client to client. The overall sales revenue of nylon department has shown a decrease in the past year, however, the sales generated from some of the clients have increased. Thus, the auditor will report the transaction condition as non-added letters of credit, and list the sales revenue of nylon products as an item of

• 14 -

the key audit matters. Refer to Note 4 to the consolidated financial statements regarding revenue recognition principle.

Our audit procedures related to the evaluation of the above-mentioned key audit matter, include the understanding and sampling of selected internal control design with effectively execution to have identified the transaction of sales revenue.

Other Matter

The Company had repared the parent company only financial statements of 2019 and 2020 as for reference, provided with auditor’s report by the Company’s accountants with no further opinions on the matter.

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

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and 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’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.

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 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:

1. Identify and assess the risks of material misstatement of the consolidated financial statement, 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.

2. 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.

3. 15 -

4. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

5. 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.

6. 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.

7. Obtain sufficient 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 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 significant in the audit of the consolidated financial statements for the year ended December 31, 2020 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 Wu, Ker-Chang and Chiu, Ming-Yu

Deloitte & Touche Taipei, Taiwan Republic of China

Mar 31, 2021

Financial Supervisory Commission ROC vetted Document no. 1000028068

Financial Supervisory Commission ROC vetted Document no. 0930160267

• 16 -

Li Peng Enterprise Co Ltd and Subsidiaries

Consolidated Balance Sheets

Dec 31, 2019, 2020

Code 1100 1110 1150 1160 1170 1180 1210 130X 1410 1476 1479 11XX 1510 1517 1550 1600 1755 1780 1840 1915 1990 15XX 1XXX Code 2100 2110 2120 2150 2160 2170 2180 2219 2220 2230 2250 2280 2320 2399 21XX 2540 2570 2580 2640 2670 25XX 2XXX 3110 3200 3310 3320 3350 3300 3400 3500 31XX 36XX 3XXX	Assets Current Assets Cash and cash equivalents (Note 6） Financial assets at fair value through profit or loss - current（Note 7） Notes receivable, net（Note 8） Notes receivable from related parties, net（Note 28） Accounts receivable, net（Note 8） Accounts receivable from related parties, net（Note 28） Loan to related parties receivable（Note 28） Inventory（Note 9） Prepayments Other financial assets - current（Note 6） Other current assets Total current assets Non-current assets Financial assets at fair value through profit or loss－non-current（Note 7） Financial assets at fair value through other comprehensive income－non-current （Note 10） Investment adjustments for Using Equity Method（Note 12） Property, plant, equipment（Note 13） Right of use asset（Note 3 and 14） Other intangible assets（Note 15） Deferred tax assets（Note 22） Prepayment for equipment Other non-current assets Total non-current assets Total Assets Liability and Equity Current liability Short-term loan（Note 16） Short-term corporate bonds payable（Note 16） Financial liabilities at fair value through profit or loss（Note 7） Notes payable Notes payable – related parties（Note 28） Accounts payable Accounts payable－related parties（Note 28） Other accounts payable（Note 28） Loan to related parties payable（Note 28） Income tax payable in current period（Note 22） Liability preparation－current Lease liability－current（Note 3 and 14） Long-term loan due in a year（Note 17） Other current liability Total current liabilities Non-current liability Long-term loan（Note 17） Deferred income tax liability（Note 22） Lease liability－non-current（Note 3 and 14） Accrued pension liability, net－non-current（Note 18） Other non-current liability Total non-current liabilities Total liability Equity Attributable to Shareholders of the Parent（Note 19） Common stock Capital reserve Retained earning Legal reserve Special reserve Accrued loss Total retained earnings Other equity Treasury stock Total Equity to Shareholders of the Parent Non-controlling interests（Note 19） Total equity Total of Liability and Equity		Dec 31,2020	％ 8 3 - - 10 1 3 12 - 1 - 38 - 13 15 31 - - 2 1 - 62 100 11 6 - - - 5 1 3 1 - - - 1 1 29 11 1 - 1 - 13 42 51 1 3 4 ( 4) 3 1 ( 3) 53 5 58 100		Unit：Thous Dec 31,2019	ands of NTD
			Amount $ 1,359,763 491,974 33,170 52,264 1,782,834 161,759 552,800 2,080,015 56,927 174,551 5,868 6,751,925 11,825 2,358,662 2,613,301 5,550,279 934 8,055 365,958 169,784 14,084 11,092,882 $ 17,844,807 $ 2,044,000 1,120,000 - 54,765 8,705 961,089 97,135 472,257 85,000 2,803 20,372 107 155,000 135,187 5,156,420 1,875,000 146,650 541 235,805 1,176 2,259,172 7,415,592 9,144,872 134,620 525,527 602,637 662,075) 466,089 168,713 432,403) 9,481,891 947,324 10,429,215 $ 17,844,807			Amount $ 2,833,122 301,097 88,747 13,641 1,775,432 51,954 164,000 2,553,973 65,564 60,634 7,803 7,915,967 13,447 1,824,018 1,782,110 6,041,544 1,191 9,697 244,046 60,157 21,324 9,997,534 $ 17,913,501 $ 4,050,000 620,000 27,094 59,179 17,985 426,406 64,776 500,661 120,000 1,830 21,653 232 350,000 140,515 6,400,331 1,100,000 147,499 962 262,699 1,475 1,512,635 7,912,966 9,144,872 134,044 525,527 602,637 248,943) 879,221 456,101) 432,403) 9,269,633 730,902 10,000,535 $ 17,913,501	％
		( (			( ( (		16 2 1 - 10 - 1 14 - - - 44 - 10 10 34 - - 2 - - 56 100 23 4 - - - 2 - 3 1 - - - 2 1 36 6 1 - 1 - 8 44 51 1 3 3 ( 1 ) 5 ( 3 ) ( 2 ) 52 4 56 100

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

Chairman: Kuo, Shao-Yi

Manager ： Kuo, Shao-Yi

Head of Accounting ： Ko, Pei-Chun

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Li Peng Enterprise Co Ltd and Subsidiaries

Consolidated Statements of Comprehensive Income

Jan 1 to Dec 31, 2019, 2020

Unit ： Thousands of NTD Except loss per share

Code 4000 Operating revenue（Note 20, 28） 5000 Operating cost（Note 9, 28） 5900 Operating margin 5910 Unrealized profit on sales to associates 5920 Realized profit on sales to associates 5950 Realized operating margin Operating expense（Note 28） 6100 Sales expense 6200 Management expense 6300 R&D expense 6450 Expected credit gain on reversal of impairment loss 6000 Total operating expenses 6900 Operating net loss Non-operating income and expenses 7100 Interest income（Note 21, 28） 7010 Other income（Note 21, 28） 7020 Other profit and loss（Note 21, 28） 7050 Finance cost（Note 21） 7060 Share of profits of associates 7000 Total non-operating income and loss		2020		％ 100 98 2 - - 2 2 2 1 - 5 3) - 1 2 ) - - 1)		2019
		Amount $ 13,559,461 13,324,652 234,809 313 ) 72 234,568 287,097 195,625 112,090 3,508) 591,304 356,736) 45,307 124,861 306,966 ) 56,497 ) 17,172 176,123)				Amount $ 14,579,347 14,201,182 378,165 72 ) - 378,093 379,520 192,048 116,310 68 687,946 309,853) 65,248 125,177 105,917 ) 63,737 ) 23,665) 2,894)		％
	( ( ( ( ( (		( ( (		( ( ( ( ( (		( (	100 97 3 - - 3 3 1 1 - 5 2) - 1 1 ) - - -

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Code 7900 Net loss before tax 7950 Income tax profit（Note 4, 22） 8200 Net loss of the year Other comprehensive income (net） 8310 Uncategorized items profit and loss： 8311 Measure on defined benefit plans 8316 Unrealized gain/(loss) on investments in equity instruments at fair value through other comprehensive income 8320 Share of other comprehensive gain of associates and joint ventures 8360 Items that may be reclassified subsequently to profit or loss： 8361 Exchange differences resulting from translation on foreign operations 8370 Shares of other comprehensive gain of associates 8300 Total other comprehensive income of the year 8500 Total comprehensive income of the year Net loss attributable to： 8610 Shareholder of the parent 8620 Non-controlling interests 8600 Comprehensive income attributable to： 8710 Shareholders of the parent 8720 Non-controlling interests 8700 Basic loss per share（Note 23） 9710 Basic		2020		％ 4 ) 1 3) - 5 1 - - 6 3 3 ) - 3) 2 1 3		2019
		Amount $ 532,859 ) 118,526 414,333) 8,963 703,868 125,153 7,112 ) - 830,872 $ 416,539 $ 412,009 ) 2,324) $ 414,333) $ 211,682 204,857 $ 416,539 $ 0.48)				Amount $ 312,747 ) 68,696 244,051) 21,024 ) 55,878 ) 45,164 ) 10,958 ) 3,985 129,039) $ 373,090) $ 249,366 ) 5,315 $ 244,051) $ 362,246 ) 10,844) $ 373,090) $ 0.29)		％
	( ( ( ( ( ( (		( ( ( (		( ( ( ( ( ( ( ( ( ( ( ( ( (		( ( ( ( ( ( ( ( (	2 ) - 2) - 1 ) - - - 1) 3) 2 ) - 2) 3 ) - 3)

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

Chairman: Kuo, Shao-Yi Manager ： Kuo, Shao-Yi Head of Accounting ： Ko, Pei-Chun

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Li Peng Enterprise Co Ltd and Subsidiaries

Consolidated Statements of Changes in Equity

Jan 1 to Dec 31, 2019, 2020

Code A1 Balance as of Jan 1, 2019 Appropriations of earnings in 2018 B1 Allowance of legal reserve B3 Allowance of special reserve B5 Cash dividends to the shareholders Changes to other capital reserve： C7 Change in associates using equity method M1 Cash dividends from parent company to subsidiary D1 Net loss in 2019 D3 Other comprehensive income in 2019 D5 Total comprehensive income in 2019 Z1 Balance as of Dec 31, 2019 Changes to other capital reserve： C7 Change in associates using equity method M7 Changes to equity ownership of subsidiary (Note 25) Q1 Subsidiary and associates’ disposal of equity tool through other comprehensive income D1 Profit and Loss in 2020 D3 Other comprehensive income in 2020 D5 Total comprehensive income in 2020 Z1 Balance as of Dec 31, 2020											Equ	ity Attributable to Sh	are	holders of the Parent										Total $ 9,797,748 - - 182,898 ) 293 16,736 249,366 ) 112,880) 362,246) 9,269,633 141 435 - 412,009 ) 623,691 211,682 $ 9,481,891		Unit： Non- Controlling interests $ 741,746 - - - - - 5,315 16,159) 10,844) 730,902 - 11,565 - 2,324 ) 207,181 204,857 $ 947,324	T	housands of NTD Total equity
		Share C	api	tal Amount $ 9,144,872 - - - - - - - - 9,144,872 - - - - - - $ 9,144,872		Capital Reserve $ 117,015 - - - 293 16,736 - - - 134,044 141 435 - - - - $ 134,620				RetainedEarning		Unappropriated Earnings （Unappropriated deficit） $ 546,762 16,195 ) 326,429 ) 182,898 ) - - 249,366 ) 20,817 ) 270,183 ) 248,943 ) - - 14,363 ) 412,009 ) 13,240 398,769 ) $ 662,075 )				Oth	ers			ets at come Using equity method Associates $ 184,390 ) - - - - - - 41,386 ) 41,386 ) 225,776 ) - - 20,479 - 120,876 120,876 $ 84,421 )		Treasury Stock $ 432,403 ) - - - - - - - - 432,403 ) - - - - - - $ 432,403 )
														Foreign Organization Financial Report Exchange difference $ 13,565 ) - - - - - - 10,958) 10,958) 24,523 ) - - - - 7,112) 7,112) $ 31,635)		Unrealize Fairvalu	d g e th	ain/loss on financial roughcomprehensive	ass in
								Legal Reserve $ 509,332 16,195 - - - - - - - 525,527 - - - - - - $ 525,527		Special Reserve $ 276,208 - 326,429 - - - - - - 602,637 - - - - - - $ 602,637						Parent company $ 143,169 - - - - - - 21,387 ) 21,387 ) 121,782 - - - - 261,635 261,635 $ 383,417		Using equity method Subsidiaries $ 309,252 ) - - - - - - 18,332 ) 18,332 ) 327,584 ) - - 6,116 ) - 235,052 235,052 $ 98,648 )
	S	hare（Thousands） 914,487 - - - - - - - - 914,487 - - - - - - 914,487
											( ( ( ( ( ( ( ( ( ( (		( ( ( ( ( ( (		( (		( ( ( ( ( (		( ( ( ( (		( ( (		( ( ( ( (		( ( (		( ( ( ( (	$ 10,539,494 - - 182,898 ) 293 16,736 244,051 ) 129,039) 373,090) 10,000,535 141 12,000 - 414,333 ) 830,872 416,539 $ 10,429,215

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

Chairman: Kuo, Shao-Yi

Manager ： Kuo, Shao-Yi

Head of Accounting ： Ko, Pei-Chun

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Li Peng Enterprise Co Ltd and Subsidiaries

Consolidated Statements of Cash Flows

Jan 1 to Dec 31, 2019, 2020

Unit ： Thousands of NTD

Code Cash Flows From Operating Activities A10000 Profit (loss) before income tax A20010 Provided by (used in) operating activities: A20100 Expected credit gain on reversal of impairment loss A20200 Depreciation A20300 Amortization A29900 Amortized prepayment A20400 Financial assets and liability at fair value through (profit) or loss A20900 Finance costs A21200 Interest income A21300 Dividend income A22300 Share of income to associates using equity method A22500 Loss (gain) on disposal or retirement of property, plant, equipment A23100 Gain on disposal of intangible assets A23200 Gain on disposal of investments accounted for using equity method, net A23800 Reversal of impairment loss on inventory A23900 Unrealized profit on sales to associates A24100 Net (gain) loss on foreign exchange Changes in operating assets and liabilities A31130 Notes receivable A31115 Collect financial assets at fair value through profit or loss A31150 Accounts receivable A31200 Inventory A31230 Prepayments A31240 Other current assets A31250 Other financial assets A32130 Notes payable A32150 Accounts payable A32180 Other accounts payable A32200 Liability preparation A32240 Accrued pension liabilities, net A32230 Other current liability A33000 Cash generated from operations A33100 Interest income A33200 Dividend income A33200 Dividend income from associates		2020 $ 532,859 ) 617,864 6,472 3,508 ) 71,701 29,449 ) 56,497 45,307 ) 1,738 ) 17,172 ) 668 ) 341 ) 51 ) 71,402 ) 241 11,910 ) 17,354 172,192 ) 67,397 ) 545,361 67,940 ) 1,945 113,027 ) 13,694 ) 571,015 15,161 ) 1,347 ) 17,931 ) 37,244) 668,112 47,131 1,738 41,872		2019
	( ( ( ( ( ( ( ( ( ( ( ( ( ( ( ( ( ( ( (		( ( ( ( ( ( ( ( ( ( (	$ 312,747 ) 614,156 9,011 68 94,388 9,694 63,737 65,248 ) 78,083 ) 23,665 1,307 791 ) - 370,509 ) 72 68,531 274,278 121,495 125,311 ) 1,303,561 59,873 ) 3,492 ) 19,079 223,888 ) 1,045,483 ) 56,530 3,730 27,253 ) 23,948 374,572 65,025 78,083 29,523

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Code 2020 2019 A33300 Interest payable ( $ 57,308 ) ( $ 63,950 ) A33500 Income tax payable ( 6,449) ( 13,811) AAAA Cash inflow from operating activities 695,096 469,442 Cash Flows from Investing Activities B00010 Acquisition of financial assets at fair value through other comprehensive income ( 49,361 ) ( 36,609 ) B00020 Acquisition or disposal of financial assets at fair value through other comprehensive income 218,584 - B01800 Acquisition of associates ( 758,415 ) ( 15,200 ) B01900 Disposal of associates 15,083 - B02200 Cash inflow from acquisition of subsidiary, net 392 - B05900 Decrease (increase) in loan to related parties receivable ( 404,500 ) 32,000 B02700 Acquisition of property, plant, equipment ( 245,335 ) ( 368,768 ) B02800 Disposal of property, plant, equipment 1,052 1,290 B03800 (Increase) decrease in refundable deposits ( 1 ) 677 B04500 Acquisition of intangible asset ( 3,193) ( 5,921) BBBB Cash outflow from investment activity ( 1,225,694) ( 392,531) Cash Flows From Financing Activities C00100 Increase (decrease) in short-term loan ( 2,006,000 ) 1,592,000 C00500 Proceeds from short-term bills payable 500,000 516,000 C01600 Lend long-term loan 875,000 - C01700 Repay long-term loan ( 295,000 ) ( 1,284,700 ) C04020 Lease principal repayment ( 463 ) ( 57 ) C03000 Increase (decrease) in refundable deposits ( 298 ) 688 C03700 Increase (decrease) in loan to related parties receivable ( 35,000 ) 7,000 C04500 Dividend payment to shareholders - ( 166,162 ) C05800 Changes to non-controlling interests 12,000 - CCCC Cash inflows (outflows) from financing activities ( 949,761) 664,769 DDDD Effect of exchange rate on cash or cash equivalents 7,000 ( 38,314) EEEE Net Increase (Decrease) in Cash and Cash Equivalents ( 1,473,359 ) 703,366 E00100 Balance of cash and cash equivalents, beginning of the year 2,833,122 2,129,756 E00200 Balance of cash and cash equivalents, end of the year $ 1,359,763 $ 2,833,122 The accompanying notes are an integral part of the consolidated financial statements.		2019

Chairman: Kuo, Shao-Yi Manager ： Kuo, Shao-Yi Head of Accounting ： Ko, Pei-Chun

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Independent Auditors’ Report

Li Peng Enterprise Company Limited

Opinion

We have audited the accompanying parent company only financial statements of Li Peng Enterprise Company Limited (the “Company”), which comprise the parent company only balance sheets as of December 31, 2020 and 2019, and the parent company only statements of comprehensive income, changes in equity and cash flows for the years then ended, and the 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, 2020 and 2019, 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 and Attestation of Financial Statements by Certified Public Accountants and 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 Norm of Professional Ethics for Certified Public Accountant 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 judgement, were of most significance in our audit of the parent company only financial statements for the year ended December 31, 2020. 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 only financial statements for the year ended December 31, 2020 are stated as follows:

The Actual Occurrence of Sales Revenue

The Company comprises of nylon department, weaving department, and trading department. The sales revenue of the nylon department is the highest among all. Nylon products are mainly traded as commodity and the sales condition varies from client to client. The overall sales revenue of nylon department has shown a decrease in the past year, however, the sales generated from some of the clients have increased. Thus, the auditor will report the transaction condition as non-added letters of credit, and list the sales revenue of nylon products as an item of the key audit matters. Refer to Notes 4 to the parent company only financial statements regarding revenue recognition principle.

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Our audit procedures related to the evaluation of the above-mentioned key audit matter, include the understanding and sampling of selected internal control design with effectively execution to have identified the transaction of sales revenue.

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

Management is responsible for the preparation and fair presentation of the parent company only financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and 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.

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

Our objectives are to obtain reasonable assurance about whether the parent company only financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an 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 form fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these parent company only financial statements.

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

1. Identify and assess the risks of material misstatement of the parent company only financial statement, 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.

2. 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.

3. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

4. 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

5. 24 -

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.

1. 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.

2. Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion 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 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 significant in the audit of the parent company only financial statements for the year ended December 31, 2020 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 Wu, Ker-Chang and Chiu, Ming-Yu

Deloitte & Touche Taipei, Taiwan Republic of China

Mar 31, 2021

Financial Supervisory Commission ROC vetted Document no. 1000028068

Financial Supervisory Commission ROC vetted Document no. 0930160267

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Li Peng Enterprise Co Ltd

Parent Company Only Balance Sheets

December 31, 2019 to 2020

Code 1100 1110 1150 1160 1170 1180 1210 130X 1410 1476 1479 11XX 1510 1517 1550 1600 1755 1780 1840 1915 1990 15XX 1XXX Code 2100 2110 2120 2150 2160 2170 2180 2219 2280 2220 2250 2320 2399 21XX 2580 2540 2570 2640 2670 25XX 2XXX 3110 3200 3310 3320 3350 3300 3400 3500 3XXX	Assets Current Assets Cash and cash equivalents (Note 6) Financial assets at fair value through profit or loss (Note 7) Notes receivable（Note 8） Notes receivable – related parties（Note 28） Accounts receivable（Note 8） Accounts receivable – related parties（Note 28） Loan to related parties receivable（Note 28） Inventory（Note 9） Prepayments Other financial assets - current（Note 6, 28） Other current assets Total current assets Non-current assets Financial assets at fair value through profit or loss – non-current（Note 7） Financial assets at fair value through other comprehensive income- non-current（Note 10） Investment adjustments for Using Equity Method (Note 11） Property, plant, equipment（Note 12） Right of use asset（Note 13） Other intangible assets（Note 14） Net deferred tax assets（Note 22） Prepayment for equipment Other non-current assets Total non-current assets Total Assets Liability and Equity Current liability Short-term loan（Note 15） Short-term corporate bonds payable（Note 15） Financial liabilities at fair value through profit or loss – current（Note 7） Notes payable Notes payable－related parties（Note 28） Accounts payable Accounts payable－related parties（Note 28） Other account payable（Note 16, 28） Lease liability－current（Note 13） Loan to related parties payable（Note 28） Liability preparation－current Long-term loan due in a year（Note 17） Other current liability Total current liabilities Non-current liability Lease liability－non-current（Note 13） Long-term loan（Note 17） Deferred income tax liability（Note 22） Accrued pension liability－non-current（Note 18） Other non-current liability Total non-current liabilities Total Liability Equity（Note 19） Common stock Capital reserve Retained earning Legal reserve Special reserve Accrued loss Total retained earnings Other equity Treasury stock Total Equity Total of Liability and Equity		December 31, 20	20 ％ 5 - - - 8 4 4 12 - 3 - 36 - 6 23 32 - - 2 1 - 64 100 12 7 - - - 5 - 5 - 1 - 1 1 32 - 11 1 1 - 13 45 53 1 3 4 ( 4) 3 1 ( 3) 55 100		Unit：Thousa December 31, 20	nds of NTD 19
			Amount $ 926,455 55,979 33,170 52,264 1,301,064 611,603 597,329 1,994,434 51,630 458,987 5,827 6,088,742 11,825 947,010 3,979,609 5,518,193 720 8,055 365,891 169,784 3,318 11,004,405 $ 17,093,147 $ 2,044,000 1,120,000 - 54,765 8,705 789,047 56,451 752,603 107 230,000 20,372 155,000 121,505 5,352,555 541 1,875,000 146,650 235,805 705 2,258,701 7,611,256 9,144,872 134,620 525,527 602,637 662,075) 466,089 168,713 432,403) 9,481,891 $ 17,093,147			Amount $ 2,526,588 54,886 72,905 13,641 1,561,858 582,362 - 2,524,490 60,877 60,362 7,998 7,465,967 13,447 682,247 2,860,462 6,006,963 1,191 9,630 244,046 60,158 11,212 9,889,356 $ 17,355,323 $ 4,050,000 620,000 27,094 59,180 17,985 421,909 51,416 496,664 232 325,000 21,653 350,000 132,892 6,574,025 962 1,100,000 147,499 262,699 505 1,511,665 8,085,690 9,144,872 134,044 525,527 602,637 248,943) 879,221 456,101) 432,403) 9,269,633 $ 17,355,323	％
		( (			( ( (		15 - 1 - 9 3 - 15 - - - 43 - 4 17 35 - - 1 - - 57 100 23 4 - - - 3 - 3 - 2 - 2 1 38 - 6 1 2 - 9 47 53 1 3 3 ( 1) 5 ( 3) ( 3) 53 100

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

Chairman: Kuo, Shao-Yi Manager ： Kuo, Shao-Yi

Head of Accounting ： Ko, Pei-Chun

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Li Peng Enterprise Co Ltd

Parent Company Only Statements of Comprehensive Income

Jan 1 to Dec 31 2019, 2020

2020 Code Amount 4000 Operating revenue（Note 20, 28） $ 10,369,775 5000 Operating cost（Note 9, 28） 10,168,838 5900 Operating margin 200,937 5910 Unrealized sales (profit) loss ( 464 ) 5920 Realized sales (loss) profit ( 4,240) 5950 Realized operating margin 196,233 Operating expense（Note 28） 6100 Sales expense 279,412 6200 Management expense 167,451 6300 R&D expense 112,090 6450 Expected credit gain on reversal of impairment loss ( 2,752) 6000 Total operating expenses 556,201 6900 Operating net loss ( 359,968) Non-operating income and expenses 7100 Interest income（Note 21, 28） 31,529 7010 Other income（Note 21, 28） 121,994 7020 Other profit and loss（Note 21） ( 308,897 ) 7050 Finance cost（Note 21, 28）( 57,704 ) 7070 Share of profits of subsidiaries and associates 39,240 7000 Total non-operating income and loss ( 173,838)		2020

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Code 7900 Net loss before tax 7950 Income tax profit（Note 4, 22） 8200 Net loss of the year Other comprehensive income (net) 8310 Uncategorized items profit and loss: 8311 Measure on defined benefit plans 8316 Unrealized gain/(loss) on investments in equity instruments at fair value through other comprehensive income 8330 Share of other comprehensive gain of subsidiaries and associates 8360 Items that may be reclassified subsequently to profit or loss: 8361 Exchange differences resulting from translation on foreign operations 8380 Share of other comprehensive gain of subsidiaries and associates 8300 Total other comprehensive income of the year 8500 Total comprehensive income of the year Basic loss per share (Note 23） 9710 Basic	2020	％ ( 5 ) 1 ( 4) - 3 3 - - 6 2	2019
	Amount ( $ 533,806 ) 121,797 ( 412,009) 8,963 261,635 360,205 ( 7,112 ) - 623,691 $ 211,682 ($ 0.48)		Amount ( $ 322,087 ) 72,721 ( 249,366) ( 21,024 ) ( 21,387 ) ( 63,496 ) ( 10,958 ) 3,985 ( 112,880) ($ 362,246) ($ 0.29)	％
				( 2 ) - ( 2) - - ( 1 ) - - ( 1) ( 3)

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

Chairman: Kuo, Shao-Yi Manager ： Kuo, Shao-Yi

Head of Accounting ： Ko, Pei-Chun

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Li Peng Enterprise Co Ltd

						Li Peng Enterprise Co Ltd	Li Peng Enterprise Co Ltd	Li Peng Enterprise Co Ltd	Li Peng Enterprise Co Ltd
Code A1 Balance as of Jan 1, 2019 Appropriations of earnings in 2018 B1 Allowance of legal reserve B3 Allowance of special reserve B5 Cash dividends to the shareholders Changes to other capital reserve： C7 Change in associates using equity method M1 Cash dividends from parent company to subsidiary D1 Net loss in 2019 D3 Other comprehensive income (loss) in 2019 D5 Total comprehensive income (loss) in 2019 Z1 Balance as of Dec 31, 2019 Changes to other capital reserve： C7 Change in associates using equity method M7 Changes to equity ownership of subsidiary Q1 Subsidiary and associates’ disposal of equity tool through other comprehensive income D1 Profit and Loss in 2020 D3 Other comprehensive income (loss) in 2020 D5 Total comprehensive income (loss) in 2020 Z1 Balance as of Dec 31, 2020	Share Capital Share（Thousands） Share Capital 914,487 9,144,872 - - - - - - - - - - - - - - - - 914,487 9,144,872 - - - - - - - - - - - - 914,487 $ 9,144,872			Capital Reserve 117,015 - - - 293 16,736 - - - 134,044 141 435 - - - - $ 134,620		Parent Company Only Statements of Changes in Equity Jan 1 to Dec 31, 2019, 2020 RetainedEarning Unappropriated Earnings Legal Reserve Special Reserve (Unappropriated deficit） 509,332 276,208 546,762 ( 16,195 - ( 16,195 ) - 326,429 ( 326,429 ) - - ( 182,898 ) - - - - - - - - ( 249,366 ) - - ( 20,817) ( - - ( 270,183) ( 525,527 602,637 ( 248,943 ) ( - - - - - - - - ( 14,363 ) - - ( 412,009 ) - - 13,240 ( - - ( 398,769) ( $ 525,527 $ 602,637 ( $ 662,075) (						Other Equity Items			ir value through Associates using Equity Method 184,390 ) - - - - - - 41,386 ) 41,386 ) 225,776 ) - - 20,479 - 120,876 120,876 $ 84,421 )		Unit: Treasury Stock 432,403 ) - - - - - - - - 432,403 ) - - - - - - $ 432,403)	Tho	usands of NTD Total
										Foreign Organization Financial report Exchange difference 13,565 ) - - - - - - 10,958 ) 10,958 ) 24,523 ) - - - - 7,112 ) 7,112 ) $ 31,635 )		Financial assets unre oth	alized profit and loss a ercomprehensiveinco	t fa me
						Legal Reserve 509,332 16,195 - - - - - - - 525,527 - - - - - - $ 525,527	Special Reserve 276,208 - 326,429 - - - - - - 602,637 - - - - - - $ 602,637					Parent Company 143,169 - - - - - - 21,387 ) 21,387 ) 121,782 - - - - 261,635 261,635 $ 383,417	Subsidiary using Equity Method ( 309,252 ) - - - - - - ( 18,332 ) ( 18,332 ) ( 327,584 ) - - ( 6,116 ) - 235,052 235,052 ( $ 98,648 )
	Share（Thousands） 914,487 - - - - - - - - 914,487 - - - - - - 914,487
								( ( ( ( ( ( ( ( ( ( (	( ( ( ( ( ( (		( (		( ( ( ( ( (	( ( ( ( (		( ( (		( ( ( ( (	9,797,748 - - 182,898 ) 293 16,736 249,366 ) 112,880) 362,246) 9,269,633 141 435 - 412,009 ) 623,691 211,682 $ 9,481,891

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

Chairman: Kuo, Shao-Yi

Manager ： Kuo, Shao-Yi

Head of Accounting ： Ko, Pei-Chun

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Li Peng Enterprise Co Ltd

Parent Company Only Statements of Cash Flows

Jan 1 to Dec 31, 2019 ,2020

Unit ： Thousands of NTD

Code 2020 Cash Flows From Operating Activities A10000 Profit (loss) before income tax ( $ 533,806 ) A20010 Provided by (used in) operating activities: A20300 Expected credit gain on reversal of impairment loss ( 2,752 ) A20100 Depreciation 614,708 A20200 Amortization 6,405 A29900 Amortized prepayment 71,701 A20400 Financial assets and liability at fair value through (profit) or loss ( 26,566 ) A20900 Finance costs 57,704 A21200 Interest income ( 31,529 ) A21300 Dividend income ( 1,555 ) A22400 Share of income to associates using equity method ( 39,240 ) A22500 Loss (gain) on disposal or retirement of property, plant, equipment ( 668 ) A23100 Gain on disposal of intangible assets, net - A23200 Gain on disposal of investments accounted for using equity method, net ( 51 ) A23800 Reversal of impairment loss on inventory ( 71,083 ) A23900 Unrealized loss on sales to subsidiaries and associates - A24000 Realized profit on sales to subsidiaries and associates 4,704 A24100 (Gain ) loss on foreign exchange, net ( 8,665 ) A30000 Changes in operating assets and liabilities A31115 Collect financial assets at fair value through profit or loss - A31130 Notes receivable 1,512 A31150 Accounts receivable 280,928 A31200 Inventory 601,139 A31230 Prepayment ( 67,341 ) A31240 Other current assets 2,192 A31250 Other financial assets ( 388,322 ) A32130 Notes payable ( 13,695 ) A32150 Accounts payable 374,405 A32180 Other payables 269,304 A32200 Liability preparation ( 1,347 ) A32240 Accrued pension liabilities ( 17,931 ) A32230 Other current liability ( 43,380)

2019

( $ 322,087 ) ( 314 ) 610,891 8,871 94,388 10,801 65,351 ( 40,349 ) ( 31,454 ) ( 33,566 ) 1,317 ( 756 ) - ( 367,741 ) ( 3,670 ) - 92,205 1,461 50,574 684,305 1,304,990 ( 62,069 ) ( 3,740 ) 28,733 ( 223,887 ) ( 1,015,764 ) 56,013 3,730 ( 27,253 ) 26,131

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Code A33000 Cash generated from operations A33100 Interest income AC0200 Dividend income A33200 Dividend income from associates A33300 Interest payable A33500 Income tax payable AAAA Cash inflow from operating activities Cash Flows From Investing Activities B00010 Acquisition of financial assets at fair value through other comprehensive income B01800 Acquisition of associates B01900 Acquisition or disposal of associates B02700 Acquisition of property, plant, equipment B02800 Disposal of property, plant, equipment B03800 Refundable deposit refunded B04500 Acquisition of intangible asset B04300 Increase in loan to related parties receivable BBBB Cash outflow from investment activity Cash Flows From Financing Activities C00100 (Decrease) increase in short-term loan C00500 Proceeds from short-term bills payable C01600 Lend long-term loan C01700 Repay long-term loan C04020 Lease principal repayment C03000 Increase in refundable deposits received C04500 Dividend payment to shareholders C03700 Loan payable to related parties (less) more CCCC Cash inflows (outflows) from financing activities DDDD Effect of exchange rate on cash or cash equivalents EEEE Net Increase (Decrease) in Cash and Cash Equivalents E00100 Balance of cash and cash equivalents, beginning of the year E00200 Balance of cash and cash equivalents, end of the year	2020 2019 $ 1,036,771 $ 907,111 33,262 38,941 1,555 31,454 41,872 29,523 ( 58,583 ) ( 65,514 ) ( 4,043) ( 12,630) 1,050,834 928,885 ( 3,127 ) - ( 787,965 ) ( 15,200 ) 15,083 - ( 244,580 ) ( 368,768 ) 1,052 1,280 - 674 ( 3,193 ) ( 5,921 ) ( 617,522) - ( 1,640,252) ( 387,935) ( 2,006,000 ) 1,592,000 500,000 516,000 875,000 - ( 295,000 ) ( 1,284,700 ) ( 236 ) ( 57 ) 200 200 - ( 182,898 ) ( 95,000) 70,000 ( 1,021,036) 710,545 10,321 ( 45,651) ($ 1,600,133) $ 1,205,844 2,526,588 1,320,744 $ 926,455 $ 2,526,588	2019

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

Chairman: Kuo, Shao-Yi

Manager ： Kuo, Shao-Yi

Head of Accounting ： Ko, Pei-Chun

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Attachments 2

LI PENG ENTERPRISE CO., LTD.

Comparative Table for the Current and Amended Articles of “Article of association”

Current Articles	Amended Articles	Amending Reasons
Article 7: The company’s stocks are registered stocks that are signed or sealed by three or more directors and issued after being issued with a visa from the issuing registration agency approved by the competent authority. The shares issued by the company may be exempted from printing stocks and should be registered with the securities centralized custodial institution.	Article 7: The stocks shall be issued through book entry system instead of issuing printing stocks according to laws and regulations; the same applies to the issuance of other securities.	Follow the regulation amendment
Article 31: This charter was established on August 11, 1975 The first amendment was made on March 28, 1976 ‧ ‧ ‧ The thirty-second amendment was made on June 18, 2020	Article 31: This Article was established on August 11, 1975 The first amendment was made on March 28, 1976 ‧ ‧ ‧ The thirty-third amendment was made on June 23, 2021	Add amendment date and number of amendment times

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LI PENG ENTERPRISE CO., LTD. Article of association

Chapter I General Principles

• Article 1 The company was organized in accordance with the provisions of the Company Act and was named LI PENG ENTERPRISE CO., LTD.

• Article 2 The Company's businesses are as follows： 1. A101020 Growing of Crops.

• A102060 Food Dealers.

• A401020 Raising of Iivestock and Poultry.

• C301010 Spinning of Yarn.

• C302010 Weaving of Textiles.

• C305010 Printing, Dyeing, and Finishing.

• C306010 Wearing Apparel.

• C399990 Other Textile and Products Manufacturing.

• C601990 Other Paper Products Manufacturing.

• C701010 Printing.

• C702010 Plate Making Industry.

• C801100 Synthetic Resin and Plastic Manufacturing.

• D101050 Combined Heat and Power.

• D101060 self-usage power generation equipment utilizing.

renewable energy industry.

1. F104110 Wholesale of Cloths, Garments, Shoes, Hats, Umbrellas and Clothing Accessories.

2. F113010 Wholesale of Machinery.

3. F114010 Wholesale of Motor Vehicles.

4. F114030 Wholesale of Motor Vehicle Parts and Motorcycle Parts, Accessories.

5. F201010 Retail Sale of Agricultural Products.

6. F204110 Retail Sale of Cloths, Garments, Shoes, Hats, Umbrellas and Clothing Accessories.

7. F213080 Retail Sale of Machinery and Tools.

8. F214010 Retail Sale of Motor Vehicles.

9. F214030 Retail Sale of Motor Vehicle Parts and Motorcycle Parts, Accessories.

10. F301020 Supermarkets.

11. G202010 Parking Area Operators.

12. H701040 Specific Area Development.

13. H701060 New Towns, New Community Development.

14. I301010 Information Software Services.

15. I301030 Electronic Information Supply Services.

16. IZ99990 Other Industrial and Commercial Services.

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31. J701020Amusement Parks.

1. J701040 Recreational Activities Venue.

2. J801030 Athletics and Recreational Sports Stadium.

3. JA01010 Automobile Repair.

4. JE01010 Rental and Leasing.

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

6. Article 2-1 The company's investment in other businesses is not subject to the total investment restrictions of the Company Law.

7. Article 3 The company set up a head office in Taipei City, and if necessary, through the resolution of the board of directors, it may establish branches at home and abroad, and depending on the business or investment relationship or inter-industry needs, external guarantees.

8. Article 4 The company's announcement method shall be handled in accordance with Article 28 of the Company Law.

Chapter II Shares

• Article 5 The total capital is rated at twelve billion New Taiwan dollars, divided into 1.2 billion shares, each with a denomination of ten New Taiwan dollars per share, and is issued in multiples. Unissued shares are authorized to be issued by the board of directors based on actual needs.

• Article 6 The transfer to employees at a price lower than the average price of the actual shares bought back should be submitted to the latest shareholders meeting to represent more than half of the total issued shares before the transfer, and with more than two-thirds of the voting rights of present shareholders agree.

• Article 7 The company’s stocks are registered stocks that are signed or sealed by three or more directors and issued after being issued with a visa from the issuing registration agency approved by the competent authority. The shares issued by the company may be exempted from printing stocks and should be registered with the securities centralized custodial institution.

• Article 8 Changes to the record in the shareholder register shall not be made within 60 days before the regular shareholders meeting, 30 days before the extraordinary shareholders meeting, or within 5 days before the base date of the company's decision to distribute dividends, bonuses or other benefits.

Chapter III Shareholders' Meeting

• Article 9 The company’s shareholders meeting is divided into two types: The regular shareholders meeting is held within six months after the end of each fiscal year; The extraordinary shareholders meeting shall be convened in accordance with relevant laws and regulations when necessary.

• Article 9-1 The company’s shareholders meeting should be convened 30 days before, and the convening of the extraordinary shareholders meeting should be held 15 days before. The date, place and reason for the meeting should be notified to all shareholders and announced.

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The notice of the convening of the shareholders meeting may be carried out electronically if the shareholders agree.

• Article 10 When a shareholder is unable to attend the shareholders meeting for some reason, a letter of attorney issued by the company shall be issued, stating the scope of authorization, and signing and sealing to entrust an agent to attend the meeting.

• Article 10-1 The chairman of the shareholders meeting shall be the chairman of the board of directors. If the chairman is absent, the vice chairman shall act as the deputy chairman of the board of directors when there is a vice chairman; When the vice chairman is also absent for some reason, the chairman shall appoint a director to act as his agent; If the chairman of the board does not appoint a person, one of the directors will recommend each other as an agent; If it is convened by a convener other than the board of directors, the chairman shall be the convener. If there are two or more conveners, one of the other conveners shall be elected.

• Article 11 Shareholders of the company have one voting right per share; however, those who are restricted or have no voting rights listed in Paragraph 2, Article 179 of the Company Law shall not be subject to this restriction.

• Article 12 The resolutions of the shareholders' meeting shall be attended by shareholders representing more than half of the total number of shares issued, unless otherwise provided by relevant laws and regulations, and shall be executed with the approval of more than half of the voting rights of the shareholders present. When the number of shareholders present is less than the amount specified in the preceding paragraph, it is understood that the relevant provisions of the Company Law shall be followed.

• Article 13 The resolutions of the shareholders' meeting shall be recorded in the minutes, which shall be signed or sealed by the chairman, and the minutes shall be distributed to all shareholders within 20 days after the meeting.

The production and distribution of the proceedings can be done electronically, and the method of distribution can be announced.

• The minutes of the proceedings should record the year, month, day, venue, chairman's name and resolution method of the meeting, and should record the essentials and results of the proceedings.

The minutes of the proceedings, the attendance card of the attending shareholders, and the proxy attendance letter of attorney shall be properly kept in accordance with the regulations of the competent authority.

• Article 14 The shareholders' meeting may check the schedules and reports of the audit committee submitted by the board of directors, and decide on the distribution of surplus or compensation of losses.

Chapter IV Directors and Supervisors

• Article 15 There are nine directors (including three independent directors) with a term of three years, and they may be re-elected. The election of directors adopts a candidate nomination system, and the shareholders choose from the list of director candidates.

• Article 16 The directors organize the board of directors. Two-thirds or more of the directors present and more than half of the directors’ present agree to elect one of them as the

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chairman of the board, and a vice chairman may be appointed by the directors in the same way to perform all the affairs of the company. The president represents the company externally.

Article 17 When the vacancy of directors reaches one-third or all independent directors are dismissed, the board of directors shall convene an interim meeting of shareholders within 60 days to elect them.

Article 18 When the chairman of the board asks for leave or is unable to exercise his powers for some reason, his agency shall be handled in accordance with Article 208 of the Company Law.

When a director entrusts other directors to attend a meeting as an agent, he shall issue a power of attorney each time and list the authorized scope of the reason for the convening.

The notice of the convocation of the board of directors can be notified in writing, fax, e-mail, etc.

When the board of directors is meeting, if a video conference is used, the directors who participate in the meeting on the video screen shall be deemed to have attended the meeting in person.

• Article 19 The resolution of the board of directors, unless otherwise stipulated by the Company Law, should be attended by more than half of the directors, and more than half of the directors present should agree to it.

• Article 20 Delete Article 21 Delete Article 22 Delete Article 23 Delete Article 24 Delete Article 25 The remuneration of the chairman and directors shall be authorized by the board of directors to determine the extent of their participation in the operation of the company and the value of their contribution to the usual standards of the industry.

Chapter V Managers

• Article 26 The company may have one general manager and several managers, and their appointment, dismissal and remuneration shall be handled in accordance with the relevant provisions of the Company Law.

Chapter VI Accounting

• Article 27 At the end of each fiscal year, the board of directors shall prepare: (1) Business report (2) Financial statements (3) Proposals for surplus distribution or loss allowances, etc. After 30 days before the meeting of the regular shareholders meeting, it is submitted to the audit committee for verification, and then submitted to the regular shareholders meeting to request recognition.

• Article 28 If there is a profit in the year, at least 2% should be allocated for employee compensation, and no more than 5% for directors' compensation. However, when there are accumulated losses, the compensation amount shall be reserved, and then the

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remuneration of employees and directors shall be allocated in accordance with the aforementioned proportion. The remuneration of employees shall be determined by the board of directors in stock or cash, and the payment objects may include employees of affiliated companies who meet the conditions set by the board of directors.

Article 29 If there is a surplus in the annual final accounts, the accumulated losses shall be made up first, and then 10% shall be allocated as the statutory surplus reserve according to law; However, when the statutory surplus reserve has reached the total paid-in capital, it is exempted to continue to be listed. The special surplus reserve shall be allocated or transferred in the second time according to laws or regulations or regulations of the competent authority. If there is a balance, add the accumulated undistributed surplus at the beginning of the period as the distributable surplus, and allocate 0% to 100% of the distributable surplus, which shall be distributed after the board of directors drafts a distribution proposal and submits it to the shareholders meeting for resolution. Among the shareholder dividends decided by the board of directors, the cash dividend shall not be less than 5% of the total dividends. However, if the cash dividend per share does not reach 0.1 yuan, it may be paid as a stock dividend.

Due to the changeable industrial environment and the development of diversification, the board of directors may change the payment of stock dividends in accordance with the capital budget and capital status.

Chapter VII Supplementary Provisions

Article 30 Matters not stipulated in this Articles of Association shall be handled in accordance with the Company Law and relevant laws and regulations.

Article 31 This charter was established on August 11, 1975 The first amendment was made on March 28, 1976 The second amendment was made on December 6, 1976 The third amendment was on June 30, 1981 The fourth amendment was on July 26, 1981 The fifth amendment was on August 10, 1985 The sixth amendment was made on July 8, 1987 The seventh amendment was made on July 8, 1988 The eighth amendment was made on June 15, 1990 The ninth amendment was on April 18, 1991 The tenth amendment was on March 23, 1992 The eleventh amendment was made on May 20, 1993 The twelfth amendment was made on April 28, 1994 The thirteenth amendment was made on May 9, 1995 The fourteenth amendment was made on May 7, 1997 The fifteenth amendment was on April 23, 1998 The sixteenth amendment was made on May 27, 1999 The seventeenth amendment was made on April 26, 2000 The eighteenth amendment was on June 13, 2001 The nineteenth amendment was on June 12, 2002 The twentieth amendment was on June 3, 2004 The twenty-first amendment was made on June 10, 2005

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The twenty-second revision was made on June 14, 2006 The twenty-third revision was on June 15, 2007 The twenty-fourth amendment was made on June 15, 2007 The twenty-fifth amendment was made on June 17, 2010 The twenty-sixth amendment was on June 6, 2012 The twenty-seventh amendment was on June 13, 2000 The twenty-eighth amendment was on June 11, 2013 The twenty-ninth amendment was on June 10, 2015 The thirtieth amendment was on June 8, 2016 The thirty-first amendment was made on June 12, 2018 The thirty-second amendment was made on June 18, 2020.

LI PENG ENTERPRISE CO., LTD. Chairman KUO, SHAO-YI

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Attachments 3

LI PENG ENTERPRISE CO., LTD.

Director election method

  - 2015.03.23 (Amended)

• Article 1: The election and appointment of directors shall be handled in accordance with these Measures, unless otherwise provided by laws or regulations or articles of association.

• Article 2: Directors shall be elected by persons with capacity in the shareholders meeting, and in accordance with the number of positions specified in the company's articles of association, the votes obtained shall represent the greater number of voting rights, and shall be elected in turn.

• Article 3: A cumulative voting system is adopted. The ballot should be prepared by the company and indicate its weight.

• Article 4: Each share has the same voting rights as the number of directors to be elected, and one person may be elected collectively or several persons may be distributed.

• Article 5: Independent directors and non-independent directors shall be elected together, and votes shall be counted separately. When two or more people have the same number of votes and exceed the prescribed number of votes, the person with the same number of votes shall draw lots. For those who are not present, the chairman shall draw lots on their behalf.

• Article 6: The chairman shall appoint a scrutineer and the teller to handle the matters of scrutiny and count, and the scrutineer shall be a shareholder.

• Article 7: The ballot boxes provided shall be inspected by the scrutineers before voting.

• Article 8: If the electee is a shareholder, the elector must fill in the electee’s account name and shareholder account number in the electee column of the ballot; Those who are not shareholders shall fill in the name of the electee and the uniform number of the identity card. However, when a government or legal person shareholder is an elected person, the name of the government or legal person should be entered in the account of the electee in the ballot, and the name of the representative may also be added; When there are several representatives, the names of the representatives should be added separately.

• Article 9: The ballot paper is invalid if one of the following circumstances occurs:

• Those who are not the votes specified in these Measures.

• Those who put blank ballots into the ballot box.

• The handwriting is illegible or unrecognizable due to alteration.

• The same ballot is filled with two or more electees.

• Fail to fill in the items specified in Article 8 or fill in incompletely.

• In addition to the items specified in Article 8, other words or signs are mixed.

• The name of the electee filled in is the same as that of other shareholders, but the shareholder account number or the uniform number of the identity card is not filled in for identification.

• The total number of voting rights voted by the elector exceeds the total number of voting rights held by the elector.

Article 10: Ballots shall be opened at the end of the voting time. After the scrutineers have confirmed that they are correct, the chairman shall announce the list of elections on the spot.

• Article 11: This method shall be implemented after being approved by the shareholders' meeting, and it shall be the same at the time of revision.

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Attachments 4

LI PENG ENTERPRISE CO., LTD. Rules of Procedure for Shareholders Meetings

Amended on 2021.03.29

• Article 1 The company’s shareholders’ meeting is conducted in accordance with these rules. Article 2 The “shareholders” mentioned in these rules refer to the shareholders themselves and their agents and solicitors as regulated by the “Regulations Governing the Use of Proxies for Attendance at Shareholder Meetings of Public Companies”.

• Article 3 Shareholders attending the shareholders meeting should present their attendance sign card or other attendance certificates to complete the procedures for attending the shareholders meeting; and should bring the original identification documents or other certification documents approved by the company, so that the staff can check it when necessary before going through the attendance. The number of attending shares shall be calculated based on the attendance card or other attendance certificates that have completed attendance procedures, plus the number of shares exercising voting rights electronically.

• Article 4 The place of the shareholders meeting shall be at the place where the company operates and suitable for the meeting of shareholders. The start time of the meeting shall not be earlier than nine o'clock in the morning or later than three o'clock in the afternoon. The registration area should be clearly marked, and there should be adequate staff at the venue, and the attendance procedures for shareholders should be handled at least 30 minutes before the start of the meeting; However, in the event of sudden force majeure, it is not subject to this limitation, and the situation should be eliminated as soon as possible, or other countermeasures should be adopted to accept shareholders to attend the shareholders meeting.

• Relevant personnel who need to participate in and assist in the convening of the shareholders' meeting, if they are shareholders, may not be restricted by the announced time for attendance procedures.

• Article 5 Unless otherwise provided by law or regulation, this Corporation's shareholders meetings shall be convened by the board of directors.

• 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 there is no vice chairperson or the vice chairperson also is on leave or for any reason unable to exercise the powers of the vice chairperson, the chairperson shall appoint one of the directors to act as chair, or, if there are no directors, one of the directors shall be appointed to act as chair. Where the chairperson does not make such a designation, the directors or the directors shall select from among themselves one person to serve as chair.

• Article 6 This Corporation may appoint its attorneys, certified public accountants, or related persons retained by it to attend a shareholders meeting in a non-voting capacity.

• Article 7 Regarding the process of the shareholders meeting, the company shall record or record the entire process and keep it for at least one year.

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• Article 8 At the appointed meeting time, with the attendance of shareholders representing more than half of the total issued shares, the chair shall call the meeting to order. If the meeting time has passed but no shareholders representing more than half of the total issued shares are present, the chairman may announce the postponement. If the quorum is not met after two postponements but with 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 of the Company Act with the approval of more than half of the voting rights of the shareholders present.

When the shareholders' meeting being a tentative resolution in the preceding paragraph, if the total number of shares represented by the shareholders present is sufficient to represent more than half of the total number of issued shares, the chairman may declare a formal meeting at any time and submit the tentative resolutions that have been made to the meeting again for voting.

• Article 9 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. After reaching the time for the announced shareholders' meeting, it cannot 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 of directors.

• Article 10 When this Corporation holds a shareholder meeting, it shall adopt exercise of voting rights by electronic means.

• A shareholder exercising voting rights by electronic means will be deemed to have attended the meeting in person, but to have waived his/her rights with respect to the extraordinary motions and amendments to original proposals of that meeting.

• Shareholders who exercise their voting rights electronically and have not revoked their expressions of intent two days before the shareholders' meeting can still attend the shareholders' meeting to participate in the proposal and voting of the interim motion, but they cannot propose amendments to the original proposal and can no longer exercise their voting rights.

• Article 11 Before speaking, an attending shareholder must specify on a speaker's slip the shareholder account number and name , and his/her subject of the speech. The order in which shareholders speak will be set by the chair.

• 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 chair and the shareholder that has the floor; the chair shall stop any violation.

• Article 12 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. If the shareholder's speech violates the rules or exceeds the scope of the agenda item, the chair may terminate the speech.

• Article 13 When a legal person is entrusted to attend the shareholders meeting, the legal person may only appoint one representative to attend.

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Article 14 After an attending shareholder has spoken, the chair may respond in person or direct relevant personnel to respond.

• Article 15 When the chairman considers that the discussion of the proposal has reached the point where it can be voted, he may announce the cessation of the discussion and put it to the vote.

• Article 16 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 this Corporation. The results of the voting shall be announced on-site at the meeting, and with a record made of the vote.

• Article 17 When a meeting is in progress, the chair may announce a break based on time considerations.

• Article 18 The voting of the proposal shall be passed with the approval of more than half of the voting rights.

• 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 19 Shareholders may not participate in the voting when they have their own interests in matters of the meeting that may be harmful to the interests of the company and shall not act on behalf of other shareholders to exercise their voting rights.

• Article 20 The resolutions of the shareholders' meeting shall not be included in the total number of issued shares for the number of shares of non-voting shareholders. The number of shares for which voting rights cannot be exercised in the preceding article shall not be counted as the number of voting rights of shareholders present.

• Article 21 When there are amendments or alternatives to the same motion, the chairman shall determine the order of voting in accordance with the original motion. If one of the bills has been passed, the other bills are deemed to be rejected and there is no need to vote again.

• Article 22 The chairman may direct pickets, security personnel or staff to help maintain order in the venue.

• Article 23 The resolutions of the shareholders' meeting shall be recorded in the minutes, signed or stamped by the chairman, and distributed to all shareholders within 20 days after the meeting. The distribution of the minutes shall be made by public announcement.

• The minutes of the proceedings should record the year, month, day, venue, chairman's name and resolution method of the meeting, and should record the essentials and results of the proceedings.

The minutes of the proceedings, the attendance card of the attending shareholders, and the proxy attendance letter of attorney shall be properly kept in accordance with the regulations of the competent authority.

• Article 24 These Rules, and any amendments hereto, shall be implemented after adoption by Board of Directors.

Matters not stipulated in this rule shall be handled in accordance with the company law.

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Attachments 5

Li Peng Enterprise Co., Ltd all directors’ shareholdings

As of the closing date: 2021, April 25

Position	Name	Shareholding by the closing date	Explanation
Chairman	KUO SHAO YI	9,584,819	1. The total number of issued shares of the company as of the closing date is 914,487,242 shares. 2. Pursuant to Article 26, the Securities and Exchange Act, and “The regulation of publicly revealing equity percentage of the company’s directors, supervisors and implementation inspection, the total number of directors’ shareholding must be at least 29,263,591 shares. 3.All directors of the company actually hold 201,562,051 shares, which has reached the regulated threshold.
Director	LEALEA ENTERPRISE CO., LTD Representative: TUNG MIN HSIUNG	145,353,853
Director	LI MOU INVESTMENT CO., LTD Representative: KUO SU JEN	34,177,995
Director	SHUN YU INVESTMENT CO., LTD Representative: KUO KO CHUNG	11,991,397
Director	CHEN PING HUANG	53,343
Director	KUO CHI KANG	400,644
Independent Director	LIN YAO CHUAN	0
Independent Director	KAO CHENG SHANG	0
Independent Director	LEE SU CHIN	0
TOTAL		201,562,051

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